Document:

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                                                                    EXHIBIT 10.1

                                                   Westpac Securitisation Trusts
                                                             Servicing Agreement

                                                     Westpac Banking Corporation
                                                                       (Westpac)

                                       Westpac Securities Administration Limited
                                                                       (Trustee)

                                   Westpac Securitisation Management Pty Limited
                                                                 (Trust Manager)

                                                               The Chifley Tower
                                                                2 Chifley Square
                                                                 Sydney NSW 2000
                                                                       Australia
                                                             Tel  61 2 9230 4000
                                                             Fax  61 2 9230 5333
                                                                  www.aar.com.au

                                       (C) Copyright Allens Arthur Robinson 2001
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Westpac Securitisation Trusts Servicing                                       +
Agreement                                                Allens Arthur Robinson

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Table of Contents

1.    Definitions and interpretation                                         1
      1.1      Definitions                                                   1
      1.2      Interpretation                                                3
      1.3      Limitation of Trustee's Liability                             4
      1.4      Series Notice                                                 5

2.    Appointment of Servicer                                                5
      2.1      Appointment                                                   5
      2.2      General duties and standard of care                           5
      2.3      Powers                                                        5
      2.4      Records                                                       6
      2.5      Servicer's power to delegate                                  6
      2.6      Servicer's power to subcontract                               6
      2.7      Servicer's power to appoint advisers                          7
      2.8      Legal title                                                   7
      2.9      License to enter Premises                                     7

3.    Duties and responsibilities of the Servicer as custodian               7
      3.1      General                                                       7
      3.2      Locate and Access                                             8
      3.3      Audit                                                         8
      3.4      Transfer of Custody                                           9

4.    Undertakings                                                           9
      4.1      Servicing Undertakings                                        9
      4.2      Westpac Undertakings                                         11
      4.3      Westpac's power to delegate                                  13
      4.4      Adverse Effect                                               13

5.    Procedures manual                                                     13
      5.1      Trustee bound by acts of Servicer                            13
      5.2      No liability for compliance                                  14
      5.3      Amendments to Procedures Manual                              14

6.    Collection and remittance of moneys                                   14
      6.1      Collection of moneys                                         14
      6.2      Remittances                                                  15
      6.3      Remittances to Trustee                                       15
      6.4      Payments and Computations, etc.                              15
      6.5      Report by Servicer                                           16
      6.6      No Right of Set-Off                                          16

7.    Servicer fees                                                         16
      7.1      Fee                                                          16
      7.2      Expenses of Servicer and Westpac                             16

8.    Termination                                                           17
      8.1      Expiry of Term                                               17

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      8.2      Servicer Transfer Event                                      17
      8.3      Resignation                                                  17
      8.4      Survival                                                     17
      8.5      Release of outgoing Servicer                                 18
      8.6      New Servicer to execute deed                                 18
      8.7      Settlement and discharge                                     18

9.    Indemnity                                                             18
      9.1      Indemnity                                                    18
      9.2      Limitation of liability                                      19
      9.3      No liability for acts of certain persons                     19
      9.4      No liability for loss etc                                    19
      9.5      Method of claiming under indemnity                           19
      9.6      Time of Payment                                              20

10.   Representations and warranties                                        20
      10.1     Representations and Warranties                               20
      10.2     Reliance                                                     20
      10.3     Survival of Representations and Indemnities                  20

11.   Westpac and the Servicer may act as banker                            20

12.   Administrative provisions                                             20
      12.1     Notices                                                      20
      12.2     Governing Law and Jurisdiction                               21
      12.3     Assignment                                                   21
      12.4     Amendment                                                    21
      12.5     Severability Clause                                          21
      12.6     Costs and Expenses                                           21
      12.7     Waivers:  Remedies Cumulative                                21

Schedule 1                                                                  25
      RECEIVABLES REGISTER INFORMATION                                      25

SCHEDULE 2                                                                  26
      AUDIT                                                                 26

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Date                                                          2001
-------------
Parties
-------------

     1.   WESTPAC BANKING CORPORATION (ARBN 007 457 141) incorporated in New
          South Wales of 60 Martin Place, Sydney in its capacity as an Approved
          Seller (Westpac);

     2.   WESTPAC SECURITIES ADMINISTRATION LIMITED (ACN 000 049 472)
          incorporated in New South Wales of Level 9, 66 Pitt Street, Sydney
          (the Trustee); and

     3.   WESTPAC SECURITISATION MANAGEMENT PTY LIMITED (ACN 081 709 211)
          incorporated in the Australian Capital Territory, of Level 25, 60
          Martin Place, Sydney, NSW (the Trust Manager).

Recitals
-------------

     A    The Trustee wants to retain the services of the Servicer to manage the
          Receivables in relation to certain Trusts and provide custodial
          services in relation to the Relevant Documents.

     B    The Trustee wants Westpac, in its capacity as an Approved Seller, to
          undertake various matters in relation to the Receivables and
          Receivable Rights that it sells to the Trustee for so long as Westpac
          holds legal title to those Receivables and Receivable Rights.

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It is agreed as follows.

1.   Definitions and interpretation
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1.1  Definitions

     In this agreement, terms defined in the Master Trust Deed or a Series
     Notice in relation to a Relevant Trust have the same meaning and the
     following definitions apply unless a different meaning is given in a Series
     Notice in relation to a Relevant Trust or the context otherwise requires.

     Audit Date means a date not later than the first anniversary of the date of
     this agreement and every 12 months after that date during the Term.

     Custody Transfer Trigger means any of the following events:

     (a)  a Further Audit resulting in an adverse report;

     (b)  a Servicer Downgrade; or

     (c)  the Servicer is in default under a servicing agreement between it and
          any other person, and by reason of the default that other person
          removes any documents in the Servicer's custody under the servicing
          agreement where that person would otherwise not have been entitled to
          do so.

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     Eligible Servicer means any suitably qualified person whose appointment by
     the Trustee as Servicer under this agreement will not materially prejudice
     the interests of the Noteholders.

     Further Audit has the meaning given in Clause 3.3(c).

     Law means any statute, rule, regulation, ordinance, order or decree of any
     Governmental Agency, and includes, without limitation the Consumer Credit
     Code and the Code of Banking Practice.

     Master Trust Deed means the Master Trust Deed between the Trustee and The
     Mortgage Company Pty Limited dated 14 February 1997.

     Material Default means, with respect to a Receivable:

     (a)  a failure by an Obligor to pay any amount pursuant to the relevant
          Receivable which failure causes the Receivable to be in Arrears and
          which failure to pay continues for a period of 90 days; or

     (b)  the occurrence of an event of default, howsoever described (other than
          a failure by an Obligor to pay an amount under the relevant
          Receivable) under that Receivable or Receivable Security unless the
          Servicer reasonably determines that such event of default is of a
          minor or technical nature and will not result in an Adverse Effect.

     Premises means the Mortgage Processing Centre at 25 Pierson Street,
     Lockleys, South Australia or such other premises as the Servicer proposes,
     and the Trustee agrees to in writing (such agreement not to be unreasonably
     withheld where the proposed premises are to be used as a document vault,
     and those premises have security to a standard at least equal to the
     Mortgage Processing Centre).

     Procedures Manual means, in relation to a Portfolio of Receivables, those
     policies and procedures of Westpac or the Servicer (as the case may be)
     relating to the origination, management and enforcement of those
     Receivables, Receivable Securities and Related Securities as those policies
     and procedures are amended in accordance with this agreement, and applied
     from time to time in Westpac's or the Servicer's ordinary course of
     business (as the case may be).

     Receivable has the meaning in the Master Trust Deed, but relates only to
     Receivables held by the Trustee under a Relevant Trust.

     Receivable Securities has the meaning in the Master Trust Deed, but relates
     only to Receivable Securities held by the Trustee under a Relevant Trust.

     Receivables Register means a register of Receivables for each Trust and
     Warehouse Trust maintained by the Servicer and stored on computer disk or
     other electronic form. In relation to Mortgages it shall contain the
     information in respect of each Mortgage set out in Schedule 1.

     Record of Movements has the meaning given in Clause 3.1(c).

     Relevant Trust means a Trust in relation to which the Servicer has been
     appointed, and has agreed to act, as Servicer under Clause 2.1(a) and a
     Series Notice.

     Security Packet means, in relation to a Receivable, each packet of Relevant
     Documents relating to that Receivable.

     Security Packet Audit means, at any time, an inventory of Security Packets
     conducted by the Servicer to verify location of the Security Packets.

     Security Vault means any security document vault located on the Premises in
     which any Security Packets or Relevant Documents are stored.

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     Servicer means Westpac or any other person who accedes to the position of
     Servicer under clause 8.6.

     Services means the services provided or to be provided by the Servicer
     under this agreement.

     Servicer Transfer Event means the occurrence of any of the following:

     (a)  an Insolvency Event occurs with respect to the Servicer;

     (b)  the Servicer fails to pay any amount in accordance with any
          Transaction Document within 5 Business Days of receipt of a notice to
          do so from either the Trustee or Trust Manager;

     (c)  the Servicer fails to comply with any of its other obligations under
          any Transaction Document and such action has had, or, if continued
          will have, an Adverse Effect (as determined by the Trustee) and the
          Servicer does not remedy that failure within 30 days after the
          Servicer becomes aware of that failure by receipt of a notice from
          either the Trustee or the Trust Manager;

     (d)  any representation, warranty or certification made by the Servicer is
          incorrect when made and is not waived by the Trustee or remedied to
          the Trustee's reasonable satisfaction within 90 days after notice from
          the Trustee, and the Trustee determines that breach would have an
          Adverse Effect; or

     (e)  if it is unlawful for the Servicer to perform the Services.

     Term means the period from the date of this agreement until the earlier of:

     (a)  the date on which this agreement is terminated pursuant to Clause 8.2;

     (b)  the date which is one month after the Notes in relation to each
          Relevant Trust have been redeemed in full in accordance with the
          Transaction Documents and the Trustee ceases to have any obligations
          to any Creditor in relation to any Trust;

     (c)  the date on which the Trustee replaces the Servicer with an Eligible
          Servicer; and

     (d)  the date on which the Servicer is replaced after resigning under
          Clause 8.3.

1.2  Interpretation

          The provisions of clause 1.2 of the Master Trust Deed apply to this
          agreement, as if set out in full, and on the basis that a reference in
          Clause 1.2(e) or (f) to "this Deed" is a reference to this agreement.

1.3  Limitation of Trustee's Liability

     (a)  Clause 33 of the Master Trust Deed applies to the obligations and
          liabilities of the Trustee under this agreement.

     (b)  The Trustee enters into this agreement only in its capacity as trustee
          of each Relevant Trust and in no other capacity. A liability arising
          under or in connection with this agreement can be enforced against the
          Trustee only to the extent to which it can be satisfied out of
          property of the Relevant Trust out of which the Trustee is actually
          indemnified for the liability. This limitation of the Trustee's
          liability applies despite any other provision of this agreement (other
          than Clause 1.3(d)) and extends to all liabilities and obligations of
          the Trustee in any way connected with any representation, warranty,
          conduct, omission, agreement or transaction related to this agreement.

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     (c)  The parties other than the Trustee may not sue the Trustee personally
          or seek the appointment of a liquidator, administrator, receiver or
          similar person to the Trustee or prove in any liquidation,
          administration or arrangement of or affecting the Trustee.

     (d)  The provisions of this Clause 1.3 shall not apply to any obligation or
          liability of the Trustee to the extent that obligation or liability is
          not satisfied because:

          (i)  under the trust deed establishing the Trust; or

          (ii) by operation of law,

          there is a reduction in the extent, or extinguishment, of the
          Trustee's indemnification out of the assets of the Relevant Trust, as
          a result of the Trustee's fraud, negligence or breach of trust.

     (e)  It is acknowledged that the Trust Manager of the Relevant Trust is
          responsible under the Master Trust Deed and the Series Notice for the
          Relevant Trust for a variety of obligations relating to the Trust,
          including under this agreement. No act or omission of the Trustee
          (including any related failure to satisfy its obligations under this
          agreement) will be considered fraud, negligence or breach of trust of
          the Trustee for the purpose of Clause 1.3(d) to the extent to which
          the act or omission was caused or contributed to by any failure by the
          Trust Manager or the Servicer or any other person properly appointed
          by the Trustee, the Trust Manager or the Servicer to fulfil its
          obligations relating to the Relevant Trust or by any other act or
          omission of the any other person properly appointed by the Trustee,
          the Trust Manager or the Servicer.

     (f)  No attorney, agent, receiver or receiver and manager appointed in
          accordance with this agreement has authority to act on behalf of the
          Trustee in a way which exposes the Trustee to any personal liability
          and no act or omission of any such person will be considered fraud,
          negligence or breach of trust of the Trustee for the purpose of Clause
          1.3(d).

1.4  Series Notice

     This agreement is subject to the Series Notice for each Relevant Trust. In
     case of any inconsistency, the Series Notice shall prevail.

2.   Appointment of Servicer

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2.1  Appointment

     The Trustee appoints the Servicer to perform the Services during the Term
     for each Trust in relation to which the Servicer is specified as, and
     agrees to act as, the Servicer in the relevant Series Notice. By executing
     a Series Notice, the Servicer shall be taken to have accepted that
     appointment, and agreed to perform the Services in relation to that Trust
     in accordance with this agreement.

2.2  General duties and standard of care

     The Servicer shall manage and service the Receivables:

     (a)  in accordance with this agreement;

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     (b)  to the extent not provided in this agreement, in accordance with the
          applicable Procedures Manual as that is interpreted and applied by the
          Servicer in the ordinary course of its business; and

     (c)  to the extent not covered by Clauses 2.2(a) and (b), by exercising the
          degree of diligence and care expected of an appropriately qualified
          servicer of the relevant financial products and custodian of
          documents.

2.3  Powers

     Subject to Clauses 2.2, 4.1(g) and 4.4, the Servicer has the express power,
     among other things, to the extent such action will not cause an Adverse
     Effect (that is, an event which will materially and adversely affect the
     amount of any payment to be made to any Noteholder, or will materially and
     adversely affect the timing of such payment):

     (a)  to waive any fees and break costs which may be collected in the
          ordinary course of servicing the Receivables or arrange the
          rescheduling of interest due and unpaid following a default under any
          Receivables;

     (b)  in its discretion, to waive any right in respect of any Receivables
          and Receivable Securities in the ordinary course of servicing the
          Receivables and Receivable Securities (including in accordance with
          its normal collection procedures); and

     (c)  to grant an extension of maturity beyond 30 years from the date any
          Receivable that relates to a mortgage loan was made, when required to
          do so by Law or a Government Agency. The restriction on granting
          extensions that will not have an Adverse Effect shall not apply where
          the extension is required by Law or a Governmental Agency.

2.4  Records

     (a)  The Servicer will maintain the Data Base used by it as a master record
          of Receivables and Receivable Securities in relation to each Relevant
          Trust.

     (b)  Each Receivable will be electronically tagged so that all related
          Collections and performance statistics (the nature of which shall be
          as mutually agreed from time to time by the Servicer, the Trust
          Manager and the Trustee) for that Receivable can be readily
          identified.

2.5  Servicer's power to delegate

     Without in any way affecting the generality of the above, the Servicer may
     in carrying out and performing its duties and obligations contained in this
     agreement:

     (a)  (delegate to employees agent) delegate to any of its officers and
          employees all Services (whether or not requiring or involving the
          Servicer's judgment or discretion);

     (b)  (appoint attorneys or subcontract) appoint any person to be its
          attorney or agent or delegate to any person for such purposes and with
          such powers, authorities and discretions (not exceeding those vested
          in the Servicer) as the Servicer thinks fit, including with:

          (i)  power for the attorney or agent to sub-delegate any such powers,
               authorities or discretions;

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            (ii)  power to authorise the issue in the name of the Servicer of
                  documents bearing facsimile signatures of the Servicer or of
                  the attorney, agent or delegate (either with or without proper
                  manuscript signatures of their officers); and

            (iii) provisions for the protection and convenience of those dealing
                  with any such attorney, agent or delegate as they may think
                  fit; and

      (c)   (suspend agents and sub-agents) supersede or suspend any such
            attorney, agent or delegate for such cause or reason as the Servicer
            may in its sole discretion think sufficient with or without
            assigning any cause or reason and either absolutely or for such time
            as it may think proper,

      but despite any delegation or appointment under the above paragraphs of
      this clause, the Servicer shall remain liable for the performance of the
      Services in accordance with this agreement and for the acts or omissions
      of any officer, employee, attorney, agent, delegate, sub-delegate or
      sub-agent and shall be solely responsible for the fees and expenses of
      such officer, employee, attorney, agent, delegate, sub-delegate or
      sub-agent.

2.6   Servicer's power to subcontract

      Without in any way affecting the generality of the above, the Servicer may
      subcontract with any person for such purposes as the Servicer thinks fit.
      In particular, the Trustee and Trust Manager acknowledge that the Servicer
      may engage EDS (Business Process Administration) Pty Limited (ABN 81 095
      806 125) as a subcontractor in relation to all or some of the Servicer's
      duties and obligations under this agreement. Despite any subcontracting
      under this clause, the Servicer shall remain liable for the performance of
      the Services in accordance with this agreement and shall be solely
      responsible for the fees of any subcontractor engaged.

2.7   Servicer's power to appoint advisers

      In accordance with its ordinary course of business, the Servicer may
      appoint and engage and act upon the opinion, advice or information
      obtained from any valuers, solicitors, barristers, accountants, surveyors,
      property managers, real estate agents, contractors, qualified advisers and
      such other persons as may be necessary, usual or desirable for the purpose
      of enabling the Servicer properly to exercise and perform its duties and
      obligations under this agreement.

2.8   Legal title

      The Servicer agrees that upon being directed to do so by the Trustee
      following a Title Perfection Event for a Relevant Trust, it will promptly
      take all action to perfect the Trustee's legal title to the relevant
      Receivables and Receivable Securities by:

      (a)   giving written notice of the Trustee's interest to any Obligor or
            Mortgagor;

      (b)   registering any Transfer of Receivable Security;

      (c)   taking any other action required or permitted by law to perfect such
            legal title; and

      (d)   delivering all Relevant Documents for that Trust to the Trustee. If
            the Servicer has not done so within 10 Business Days (or such longer
            period as the Trustee permits) the Trustee may enter any premises
            where those Relevant Documents are kept, take possession of and
            remove those Relevant Documents. The Servicer shall assist the
            Trustee in doing so.

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2.9   License to enter Premises

      Westpac irrevocably licenses the Trustee to enter onto the Premises for
      the purpose of taking possession of, and removing, the Relevant Documents
      in accordance with this agreement.

3.    Duties and responsibilities of the Servicer as custodian
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3.1   General

      The Servicer's duties and responsibilities (in its capacity as custodian
      under this agreement) are to:

      (a)   hold as custodian under this agreement at the direction of the
            Trustee each Relevant Document that it may receive on behalf of the
            Trustee (or its agent or nominee) pursuant to a Transaction Document
            in accordance with its standard safekeeping practices;

      (b)   ensure that each Relevant Document is capable of identification and
            is kept in a Security Packet which is kept together with other
            Security Packets relating to the Receivables of that Trust in a
            security vault, and separate from other documents held by the
            Servicer for another Trust or otherwise;

      (c)   in relation to each Relevant Trust, open and maintain in safe
            custody a record of physical movement from the Premises and between
            each Relevant Trust of any Relevant Document held by it from time to
            time pursuant to this agreement (the Record of Movements);

      (d)   update the Receivables Register and give a copy to the Trustee:

            (i)   within 3 months of the Closing Date for each Relevant Trust;

            (ii)  if either it or its holding company (if any) has a short term
                  rating from the Designated Rating Agency of not less than A-,
                  not later than the last Business Day of each calendar year
                  during the Term;

            (iii) if neither it nor its holding company (if any) has such a
                  rating; on the last Business Day of each calendar quarter
                  during the Term;

            (iv)  within 30 days of a written request by the Trustee if the
                  Trustee (in its discretion, but acting reasonably) believes
                  that the Servicer or Westpac is breaching its obligations
                  under this agreement or any other Relevant Document; and

      (e)   at all times during the currency of this agreement do all acts,
            matters and things which may reasonably be required of the Servicer
            by the Trustee for the purposes of, or as contemplated by, this
            agreement.

3.2   Locate and Access

      (a)   The Servicer shall ensure that at all times it shall be able to
            locate each Security Packet by way of a periodic Security Packet
            Audit.

      (b)   Unless the Servicer requires a Relevant Document to perform its
            duties as Servicer in relation to the related Receivable, or
            otherwise comply with its obligations under the Transaction
            Documents, each Relevant Document shall be kept within the Security
            Vault.

      (c)   Other than the Servicer requiring a Relevant Document under Clause
            3.2(b), or for an audit by Westpac's or the Servicer's internal or
            external auditor, or by the Auditor under Clause

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            3.3 of this agreement, a Relevant Document may only be removed from
            the Security Vault with the Trustee's written approval and for the
            following purposes:

            (i)   inspection by the Trustee; or

            (ii)  such other purpose approved in writing by the Trustee.

3.3   Audit

      (a)   The Trust Manager or the Trustee (in default of action by the Trust
            Manager) shall on each Audit Date request an independent auditor to
            conduct an audit of the Servicer's custodial role with respect to
            the Relevant Documents for any Relevant Trust by considering the
            matters set out in Schedule 2.

      (b)   The terms of the instruction of that auditor must require delivery,
            within one month of an Audit Date, of a certificate addressed to the
            Trustee, the Servicer and the Designated Rating Agency stating
            whether or not the Servicer has complied with the matters set out in
            Schedule 2.

      (c)   Where a certificate referred to in Clause 3.3(b) (the Audit
            Certificate) gives an "Adverse" finding (as set out in Schedule 2),
            the Trustee must direct that auditor to conduct a further audit (the
            Further Audit) on a similar basis to the audit to which the Audit
            Certificate related. The Further Audit shall be conducted no later
            than one month after the date of the Audit Certificate. That auditor
            shall then issue a new certificate with respect to the Further Audit
            in the form required by Clause 3.3(b) no later than one month after
            the date on which the Further Audit commenced.

      (d)   Subject to any bona fide confidentiality restrictions, the Servicer
            shall give each auditor full access to all relevant information and
            the Relevant Documents for the purpose of conducting each audit
            under Clause 3.3.

      (e)   The Trustee shall pay the reasonable fees and expenses of the
            auditor with respect to any audit under this Clause 3.3.

      (f)   The auditor instructed under this Clause must be instructed to give
            written reasons supporting any "Adverse" finding.

      (g)   The Servicer shall take all reasonable steps to cure any non
            compliance identified by an audit.

3.4   Transfer of Custody

      If:

      (a)   a Servicer Transfer Event occurs and is subsisting; or

      (b)   a Custody Transfer Trigger occurs,

      the Servicer must deliver the Relevant Documents to the Trustee, or as it
      directs. If the Servicer has not done so within 10 Business Days (or such
      longer period as the Trustee permits) the Trustee must enter any premises
      where the Relevant Documents are kept, take possession of and remove the
      Relevant Documents. The Servicer shall assist in doing so. If the Trustee
      does not have possession of the Relevant Documents within that period it
      must, to the extent that it has information available to it to do so,
      lodge caveats in relation to and/or take all other action it considers
      necessary to protect

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      its interests in the Receivables and Receivable Securities for which it
      does not hold the Relevant Documents.

4.    Undertakings

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4.1   Servicing Undertakings

      [The Servicer undertakes that at all times during the Term it will:

      (a)   (notice of default) give notice in writing to the Trustee and the
            Designated Rating Agency of it becoming aware of the occurrence of
            any Servicer Transfer Event;

      (b)   (compliance with law)

            (i)   maintain in effect all qualifications, consents, licences,
                  permits, approvals, exemptions, filings and registrations as
                  may be required under any applicable law in order properly to
                  service the Receivables and Receivable Securities and to
                  perform or comply with its obligations under this agreement;
                  and

            (ii)  comply with all Laws in connection with servicing the
                  Receivables and Receivable Securities where failure to do so
                  would have an Adverse Effect;

      (c)   (Collections):

            (i)   in relation to Receivables of which Westpac is the legal
                  owner, on request from Westpac, assist Westpac to collect all
                  moneys due under those Receivables and the Receivable
                  Securities; and

            (ii)  in relation to Receivables of which the Trustee is the legal
                  owner, collect all moneys due under those Receivables and
                  Receivables Securities,

                  in accordance with the standards specified in Clause 2.2, and
                  pay them into the relevant Collections Account not later than
                  the time that Westpac, in its capacity as an Approved Seller,
                  would be required to do so under Clause 6;

      (d)   (Material Default) if a Material Default occurs in respect to a
            Receivable, take such action in accordance with the Servicer's
            normal enforcement procedures to enforce the relevant Receivable and
            the Receivable Security to the extent that the Servicer determines
            that enforcement procedures should be taken;

      (e)   (Insurance Policies)

            (i)   act in accordance with the terms of any Mortgage Insurance
                  Policies;

            (ii)  not do or omit to do anything which could be reasonably
                  expected to prejudicially affect or limit its rights or the
                  rights of the Trustee under or in respect of a Mortgage
                  Insurance Policy to the extent those rights relate to a
                  Receivable and the Receivable Security;

            (iii) promptly make a claim under any Mortgage Insurance Policy when
                  it is entitled to do so; and

            (iv)  promptly notify the Trust Manager when each such a claim is
                  made;

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      (f)   (no Security Interests) not consent to the creation or existence of
            any Security Interest in favour of a third party in relation to any
            Mortgaged Property in connection with a Receivable and the
            Receivable Security:

            (i)   without limiting paragraph (f)(ii), unless priority
                  arrangements are entered into with that third party under
                  which the third party acknowledges that the Receivable and
                  Receivable Security ranks ahead in priority to the third party
                  Security Interest on enforcement for an amount not less than
                  the Unpaid Balance of the Receivable plus such other amount as
                  the Servicer determines in accordance with the Procedures
                  Manual or its ordinary course of business; or

            (ii)  which would rank before or pari passu with the relevant
                  Receivable and Receivable Security;

      (g)   (release of debt or vary terms) not, except as required by Law,
            release an Obligor from any amount owing in respect of a Receivable
            or otherwise vary or discharge any Receivable or Receivable Security
            or enter into any agreement or arrangement which has the effect of
            altering the amount payable in respect of a Receivable or Receivable
            Security where it would have an Adverse Effect;

      (h)   (binding provisions and orders of a competent authority) release any
            Receivable or Receivable Security, reduce the amount outstanding
            under or vary the terms of any Receivable or grant other relief to
            an Obligor, if required to do so by any Law or if ordered to do so
            by a court, tribunal, authority, ombudsman or other entity whose
            decisions are binding on the Servicer. If the order is due to the
            Servicer breaching any applicable Law then the Servicer must
            indemnify the Trustee for any loss the Trustee may suffer by reason
            of the order. The amount of the loss is to be determined by
            agreement with the Trustee or failing this, by the Servicer's
            external auditors;

      (i)   (other miscellaneous things) attend to the stamping and registration
            of all Relevant Documents for each Relevant Trust (including
            documents which became Relevant Documents) following any amendment,
            consolidation or other action, and in the case of any registration
            of any Mortgage that registration must result in the Mortgage having
            the ranking referred to in the relevant eligibility criteria in the
            Series Notice. In relation to any Mortgage that is not registered at
            the relevant Closing Date, the Servicer shall ensure that it is
            lodged for registration not later than 120 days after that Closing
            Date;

      (j)   (setting the Interest Rate)

            (i)   the Servicer shall set the interest rate on the Receivables
                  for a Relevant Trust in accordance with the requirements of
                  the Series Notice for that Relevant Trust; and

            (ii)  subject to the Series Notice for that Relevant Trust, if the
                  Trustee has perfected its title to the Receivables or
                  Receivable Securities and the Trustee is entitled to vary the
                  interest rate in accordance with the terms of the Receivables,
                  the Servicer shall, in accordance with the terms of the
                  Receivables, set and maintain the interest rate on the
                  relevant Receivables at or above the relevant Threshold Rate
                  as advised by the Trust Manager in accordance with the Master
                  Trust Deed and the Series Notice for that Relevant Trust and
                  promptly notify the relevant Obligors;

      (k)   (notification) notify:

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            (i)   the Trustee and the Trust Manager of any event which it
                  reasonably believes is likely to have an Adverse Effect
                  promptly after becoming aware of such event; and

            (ii)  the Trust Manager of anything else which the Trust Manager
                  reasonably requires regarding any proposed modification to any
                  Receivable or Receivable Security.

      (l)   (provide information and access on request) provide information
            reasonably requested by the Trustee or the Trust Manager, with
            respect to all matters relating to each Relevant Trust and the
            assets of the relevant Trust, and the Trustee or the Trust Manager
            believes reasonably necessary for it to perform its obligations
            under the relevant Transaction Documents, and upon reasonable notice
            and at reasonable times permit the Trustee to enter the Premises and
            inspect the Data Base in relation to each Relevant Trust and the
            Relevant Documents;

      (m)   (comply with other obligations) comply with all its obligations
            under any Transaction Document to which it is a party, where a
            failure to do so would result in an Adverse Effect;

      (n)   (pay taxes) subject to receiving payment from, or being reimbursed
            by, the relevant Obligor or being indemnified by the Trustee, pay
            all Taxes that relate to the Services (other than any Tax on the
            income of a Trust) or ensure those Taxes are paid or where such
            Taxes are incurred due to the default or breach of duty by the
            Servicer;

      (o)   (not claim) not claim any Security Interest over any Asset;

      (p)   (availability of Data Base) make the Data Base that relates to the
            Services available for inspection by the Trustee at any reasonable
            time;

      (q)   (comply with Series Notice) comply with any undertaking specified as
            an additional Servicer undertaking in a relevant Series Notice,
            including, without limitation, providing the Trust Manager with any
            information referred to in that Series Notice;

      (r)   (insurances) ensure that the Premises are appropriately insured for
            fire and public risks, and that it has appropriate directors and
            officers insurance;

      (s)   (additional amounts) notify Westpac and the Trust Manager
            immediately of each request by an Obligor to borrow further moneys
            under or in relation to a Receivable or Receivable Security which is
            a "top-up" and which the Servicer has approved; and

      (t)   (comply with Trust Back) apply any moneys it receives in relation to
            any Other Secured Liability in accordance with the relevant Trust
            Back in accordance with the directions of the Trustee.]

4.2   Westpac Undertakings

      Westpac, in its capacity as an Approved Seller, undertakes that at all
      times during the Term, and for so long as it is the legal owner of any
      Receivable or Receivable Security, it will:

      (a)   (compliance with law)

            (i)   maintain in effect all qualifications, consents, licences,
                  permits, approvals, exemptions, filings and registrations as
                  may be required under any applicable Law in relation to its
                  ownership of any Receivable or Receivable Security and to
                  perform or comply with its obligations under this agreement;
                  and

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            (ii)  comply with all Laws in connection with its ownership of any
                  Receivables and Receivable Securities where failure to do so
                  would have an Adverse Effect;

      (b)   (co-operate with the Servicer) if Westpac is not the Servicer,
            co-operate with the Servicer in relation to the performance by the
            Servicer of the Services including, without limitation, in relation
            to the enforcement of any Receivable or Receivable Security;

      (c)   (comply with Series Notice) comply with any undertaking specified in
            relation to it in a relevant Series Notice, including, without
            limitation, providing the Trust Manager with any information
            referred to in that Series Notice;

      (d)   (Material Default) if a Material Default occurs in respect to a
            Receivable, take such action as the Servicer directs it to take in
            accordance with this agreement (or, if Westpac is the Servicer, such
            action as Westpac determines in accordance with its ordinary course
            of business);

      (e)   (Insurance Policies) act in accordance with the terms of any
            Mortgage Insurance Policies, and not do or omit to do anything which
            could be reasonably expected to prejudicially affect or limit the
            rights of the Trustee under or in respect of a Mortgage Insurance
            Policy to the extent those rights relate to a Receivable and the
            Receivable Security;

      (f)   (no Security Interests) not consent to the creation or existence of
            any Security Interest in favour of a third party in relation to any
            Mortgaged Property in connection with a Receivable and the
            Receivable Security:

            (i)   without limiting paragraph (f)(ii), unless priority
                  arrangements are entered in to with that third party under
                  which the third party acknowledges that the Receivable and
                  Receivable Security ranks ahead in priority to the third party
                  Security Interest on enforcement for an amount not less than
                  the Unpaid Balance of the Receivable plus such other amount as
                  the Servicer determines in accordance with the Procedures
                  Manual or its ordinary course of business; or

            (ii)  which would rank before or pari passu with the relevant
                  Receivable and Receivable Security;

      (g)   (release of debt or vary terms) not, except as required by Law,
            release an Obligor from any amount owing in respect of a Receivable
            or otherwise vary or discharge any Receivable or Receivable Security
            or enter into any agreement or arrangement which has the effect of
            altering the amount payable in respect of a Receivable or Receivable
            Security where it would have an Adverse Effect;

      (h)   (binding provisions and orders of a competent authority) release any
            Receivable or Receivable Security, reduce the amount outstanding
            under or vary the terms of any Receivable or grant other relief to
            an Obligor, if required to do so by any Law or if ordered to do so
            by a court, tribunal, authority, ombudsman or other entity whose
            decisions are binding on Westpac. If the order is due to Westpac
            breaching any applicable Law then Westpac must indemnify the Trustee
            for any loss the Trustee may suffer by reason of the order. The
            amount of the loss is to be determined by agreement with the Trustee
            or failing this, by Westpac's external auditors;

      (i)   (not claim) not claim any Security Interest over any Asset; and

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      (j)   (additional amounts) notify the Servicer immediately of each request
            by an Obligor to borrow further moneys under or in relation to a
            Receivable or Receivable Security.

4.3   Westpac's power to delegate

      (a)   For so long as Westpac is the legal owner of any Receivables and is
            not the Servicer, and Westpac is required by Law (including, without
            limitation, the Consumer Credit Code) to do, or refrain from doing,
            certain things in relation to those Receivables or the Receivable
            Securities:

            (i)   Westpac appoints the Servicer to do those things on its
                  behalf, except as specified in the Procedures Manual;

            (ii)  Westpac directs the Servicer to perform the Services in a
                  manner that is consistent with any obligation of Westpac under
                  any Law;

            (iii) Westpac authorises the Servicer to conduct correspondence with
                  Obligors and other persons as if it had been appointed to
                  perform the Services by Westpac as legal owner of those
                  Receivables and Receivable Securities, but this authorisation
                  is subject to any restriction imposed on the Servicer in any
                  power of attorney or the Procedures Manual; and

            (iv)  the Servicer accepts that appointment and direction and agrees
                  to perform the Services in accordance with this agreement.

      (b)   Despite any delegation under this Clause, Westpac shall remain
            liable in relation to any obligation it delegates to the Servicer,
            and for the acts, omissions, fees and expenses of the Servicer as
            its delegate.

4.4   Adverse Effect

      (a)   In performing the Services the Servicer shall have regard to whether
            what it does, or does not do, will have any Adverse Effect.

      (b)   The Servicer may ask the Trustee or the Trust Manager if any action
            or inaction on its part is reasonably likely to, or will, have an
            Adverse Effect.

      (c)   The Servicer may rely upon any statement by the Trustee or the Trust
            Manager that any action or inaction by the Servicer is reasonably
            likely to, or will, have an Adverse Effect.

      (d)   Subject to paragraph (a), the Servicer shall not be liable for a
            breach of this agreement, or be liable under any indemnity, in
            relation to any action or inaction on its part, where it has been
            notified by the Trustee or the Trust Manager that the action or
            inaction is not reasonably likely to, or will not have an Adverse
            Effect.

5.    Procedures manual

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5.1   Trustee bound by acts of Servicer

      All acts of the Servicer in servicing the Receivables in accordance with
      the relevant Procedures Manual are binding on the Trustee.

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5.2   No liability for compliance

      (a)   The Servicer is not in breach of its duties under this agreement or
            otherwise liable to the Trustee if it complies strictly with the
            relevant Procedures Manual unless:

            (i)   the relevant Procedures Manual does not materially comply with
                  any Law; or

            (ii)  the Servicer is not otherwise complying with Clauses 2.2 and 4
                  in relation to the relevant matter or duty.

      (b)   If the Servicer becomes aware that any Procedures Manual does not
            materially comply with any Law, it shall notify the Trustee within
            10 Business Days and take all reasonable steps to rectify that
            non-compliance.

5.3   Amendments to Procedures Manual

      The Servicer shall not amend the relevant Procedures Manual in any way
      that would reasonably be expected to result in an Adverse Effect, unless
      it must do so to ensure compliance with Law. The Servicer shall notify the
      Trustee, the Trust Manager and the Designated Rating Agency of any
      material amendment to the relevant Procedures Manual.

6.    Collection and remittance of moneys

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

6.1   Collection of moneys

      (a)   Westpac, in its capacity as an Approved Seller, shall on behalf of
            the Trustee collect and receive the Collections in respect of
            Receivables in relation to which Westpac is the legal owner.

      (b)   In collecting and receiving the Collections for Receivables in
            relation to which it is the legal owner, Westpac shall:

            (i)   act in accordance with the standards and practices applied by
                  Westpac to other assets which it owns in the ordinary course
                  of its business and in accordance with the Procedures Manual;
                  and

            (ii)  exercise the degree of diligence and care expected of an
                  appropriately qualified lender in relation to the relevant
                  financial products.

      (c)   Westpac may, from time to time if it is not the Servicer, delegate
            to the Servicer the collection and receipt of the Collections
            referred to in paragraph (a). Westpac may revoke that delegation.
            Westpac shall remain liable under paragraph (a) despite any
            delegation under this paragraph (c). If Westpac so delegates to the
            Servicer the collection and receipt of any Collections, the Servicer
            must not deposit any Collections in its own account, and shall
            deposit them in the relevant Collections Account not later than the
            time that Westpac would have been required to deposit them under
            this agreement.

      (d)   Following the perfection of title to any Receivable and Receivable
            Rights, the Servicer shall assist the Trustee in relation to the
            collection and receipt of Collections in respect of those
            Receivables and Receivable Rights.

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6.2   Remittances

      (a)   If Westpac has a Westpac Remittance Rating or otherwise satisfies
            the requirements of each Designated Rating Agency so that any rating
            given by any Designated Rating Agency in respect of any relevant
            Notes will not be adversely affected, Westpac, in its capacity as an
            Approved Seller, must pay the Collections it receives during a
            Collection Period on the Remittance Date for that Collection Period
            into the relevant Collection Account.

      (b)   Subject to the terms of the relevant Series Notice, on that
            Remittance Date, Westpac, in its capacity as an Approved Seller,
            must pay into the relevant Collection Account an amount equal to the
            aggregate of:

            (i)   the Collections received during the Collection Period relating
                  to that Remittance Date; and

            (ii)  an amount equal to the interest that would have been earned on
                  such Collections received by it if they had been deposited
                  into the relevant Collection Account five Business Days
                  following receipt by the Servicer,

            less an amount equal to any Taxes payable in relation to those
            Collections and any other amount Westpac may retain in accordance
            with any relevant Series Notice.

      (c)   If Westpac does not have a Westpac Remittance Rating or otherwise
            does not satisfy the requirements of each of those Designated Rating
            Agencies so that the rating given by any Designated Rating Agency in
            respect of any relevant Notes will be adversely affected, then
            Westpac, in its capacity as an Approved Seller, shall pay all
            Collections in its possession or control into the relevant
            Collection Account no later than five Business Days following
            receipt.

      (d)   If a Collection Account is not maintained with Westpac, or a
            subsidiary of Westpac, all Collections in relation to the relevant
            Trust must be deposited into that Collection Account no later than
            two Business Days following receipt of them by Westpac.

6.3   Remittances to Trustee

      (a)   (Transfer of funds to Trustee) Westpac, in its capacity as an
            Approved Seller, shall pay to the relevant Collection Account all
            funds required to be paid to the Trustee in accordance with this
            Clause 6 by wire transfer or as otherwise instructed by the Trustee
            in same day funds.

      (b)   (Payment dishonoured) If Westpac pays funds relating to any payment
            in respect of Receivables and Receivable Securities to the Trustee
            and the related Obligor's payment for the payment is, or is
            returned, dishonoured, Westpac shall be entitled to a return of the
            amount remitted to the Trustee for which Westpac did not receive
            funds from the Obligor. Westpac may withhold that amount from funds
            subsequently remitted to the Trustee in relation to the Relevant
            Trust.

6.4   Payments and Computations, etc.

      (a)   Subject to the terms of any relevant Series Notice, Westpac, in its
            capacity as an Approved Seller, shall make all payments to the
            Trustee under a Transaction Document:

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            (i)   without set off or counterclaim and without deduction, except
                  in relation to any deductions that may be made in accordance
                  with this Clause; and

            (ii)  by paying or depositing it in accordance with the terms of the
                  relevant Transaction Document no later than 4.00 pm on the day
                  when due in same day funds.

      (b)   If any payment is due on a day which is not a Business Day, the due
            date will be the next Business Day.

6.5   Report by Servicer

      On or before each Determination Date for each Relevant Trust the Servicer
      will prepare and submit to the Trust Manager a report on Collections, and
      provide such other information as the Trust Manager reasonably requires to
      prepare its report under Clause 18.15 of the Master Trust Deed.

6.6   No Right of Set-Off

      Notwithstanding any term of any other document, whether relating to the
      establishment of a Collection Account or otherwise, if a Collection
      Account is maintained with Westpac, Westpac agrees that it shall have no
      right of set-off, banker's lien, right of combination of accounts, right
      to deduct moneys or any other analogous right or security in or against
      any funds held in the Collection Account for any amount owed to Westpac.

7.    Servicer fees

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

7.1   Fee

      The Trustee shall in accordance with, and subject to the relevant Series
      Notice pay to the Servicer a fee for providing its services under this
      agreement in relation to each Trust.

7.2   Expenses of Servicer and Westpac

      (a)   The Trustee must reimburse the Servicer and Westpac, in its capacity
            as an Approved Seller, for all legal and selling expenses relating
            to the enforcement and recovery of the Receivables, including legal
            expenses, valuations, premiums on force - placed insurance policies
            where the relevant Obligor has cancelled or let lapse an insurance
            policy, rates and taxes, any amount repaid to a liquidator or
            trustee in bankruptcy under any applicable law, binding code, order
            or decision of a court, tribunal or the like or based on the advice
            of the Servicer's legal advisers, and other reasonable amounts which
            the Servicer or Westpac, in its capacity as an Approved Seller,
            reasonably spends or incurs in relation to the enforcement or sale,
            provided that where the consent of an insurer under a Mortgage
            Insurance Policy is required in order for an expense to be
            reimbursable by that insurer, the Servicer or Westpac, in its
            capacity as an Approved Seller, will only be reimbursed where it has
            obtained that consent. This right of reimbursement to Westpac, in
            its capacity as an Approved Seller, is subject to the terms of any
            relevant Trust Back under the Master Trust Deed.

      (b)   The Servicer will invoice the Trustee monthly on each Determination
            Date in relation to each Relevant Trust for the costs and expenses
            under paragraph (a), and shall provide reasonable details and
            supporting documentation in relation to amounts to be reimbursed.

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      (c)   This reimbursement shall be in accordance with the relevant Series
            Notice.

      (d)   The Trustee must, in accordance with the Master Trust Deed, on the
            recommendation of the Trust Manager, reimburse the Servicer for all
            costs and expenses incurred by the Servicer in complying with Clause
            2.7.

      (e)   Except as provided in this Clause, the Servicer shall be responsible
            for all other costs and expenses of servicing the Receivables.

      (f)   Westpac, in its capacity as an Approved Seller, and the Servicer
            shall determine between themselves who will incur the liabilities
            referred to in paragraph (a). They will inform the Trustee and the
            Trust Manager on request of the arrangements that they make.

8.    Termination

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

8.1   Expiry of Term

      This agreement shall continue until the expiry of the Term.

8.2   Servicer Transfer Event

      (a)   If a Servicer Transfer Event occurs, the Trustee must terminate this
            agreement with immediate effect. The Trustee must promptly give
            notice of that termination to the Trust Manager, the Approved
            Seller, the Servicer and the Designated Rating Agencies.

      (b)   Following such action:

            (i)   Clause 3.4 shall apply; and

            (ii)  the Servicer must promptly transfer at its own cost to the
                  Trustee or as the Trustee directs the relevant information in
                  the Data Base held or maintained by the Servicer in relation
                  to this agreement, the Receivables or Receivable Securities.

      (c)   The Trustee will not appoint any other person to perform all or part
            of the obligations the Servicer has undertaken to perform under this
            agreement or to service any of the Receivables unless:

            (i)   the Trustee has terminated this agreement in accordance with
                  the provisions of paragraph (a); or

            (ii)  the Servicer has resigned in accordance with clause 8.3.

      (d)   [If this agreement is terminated in accordance with this clause 8.2,
            then until the Trustee appoints an Eligible Servicer to be the
            Servicer, and that Eligible Servicer agrees to act as Servicer, the
            Trust Manager shall act as Servicer and is entitled to the fee
            payable under clause 7 while so acting.]

8.3   Resignation

      The Servicer shall not resign without first giving 3 months' notice to the
      Designated Rating Agency, the Trust Manager and the Trustee. If the
      Trustee has not appointed an Eligible Servicer to be the Servicer, which
      Eligible Servicer has agreed to act as Servicer, by the expiration of that
      notice period, the Servicer shall continue to act as Servicer and be
      entitled to the fee payable under Clause 7 while so acting, provided that:

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      (a)   the Trust Manager and the Trustee shall use all reasonable efforts
            to appoint an Eligible Servicer to be the Servicer; and

      (b)   if, after 5 months from the date on which the Servicer gave notice
            of its resignation, no Eligible Servicer has been appointed and has
            agreed to act as Servicer, then the Servicer shall be entitled to
            select an Eligible Servicer and, on behalf of the Trustee and the
            Trust Manager, appoint that Eligible Servicer to be the Servicer.
            Each of the Trustee and Trust Manager irrevocably authorises the
            Servicer to make that appointment on its behalf. Upon that Eligible
            Servicer being appointed and agreeing to act as Servicer, the
            Servicer shall be released from its obligations under this agreement
            in accordance with clause 8.5.

8.4   Survival

      The obligations of the Servicer under Clause 8 survive the termination of
      this agreement.

8.5   Release of outgoing Servicer

      Except as provided in Clause 8.4, upon retirement or removal and provided
      there has been payment to the Trustee of all sums due to it by the
      outgoing Servicer under this agreement at that date, the outgoing Servicer
      shall be released from all further obligations under this agreement but no
      release under this clause shall extend to any existing or antecedent
      fraud, negligence or wilful default on the part of the outgoing Servicer
      or its officers, employees, agents or delegates.

8.6   New Servicer to execute deed

      (a)   A new Servicer shall execute a deed in such form as the Trustee may
            reasonably require under which the new Servicer shall undertake to
            the Trustee and other relevant parties to be bound by all the
            covenants on the part of the Servicer under the Transaction
            Documents from the date of execution of the new deed on the same
            terms contained in the Transaction Documents.

      (b)   On and from the date of execution of the new deed, the new Servicer
            shall and may afterwards exercise all the powers, enjoy all the
            rights and shall be subject to all the duties and obligations of the
            Servicer under the Transaction Documents as fully as though the new
            Servicer had been originally named as a party to it.

8.7   Settlement and discharge

      The Trustee shall settle with the outgoing Servicer the amount of any sums
      payable by the outgoing Servicer to the Trustee or by the Trustee to the
      outgoing Servicer and shall give to or accept from the outgoing Servicer a
      discharge in respect of those sums which shall be conclusive and binding
      as between the Trustee, the outgoing Servicer, the new Servicer, the Trust
      Manager, the Beneficiaries and the Noteholders.

9.    Indemnity

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

9.1   Indemnity

      Subject to the succeeding provision of this clause, the Servicer fully
      indemnifies the Trustee from and against any expense, loss, damage or
      liability which the Trustee may incur as a consequence of a Servicer
      Transfer Event, or a failure by the Servicer to perform its duties under
      this agreement,

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      including, without limitation, a failure to deliver the Relevant Documents
      to the Trustee when it is required to do so or to keep the Receivables
      Register in accordance with this agreement.

9.2   Limitation of liability

      The Servicer is not liable:

      (a)   in connection with anything done by it in good faith in reliance
            upon any document, form or list provided by or on behalf of the
            Trustee except when it has actual knowledge, or ought reasonably
            know, that the document, form or list is not genuine;

      (b)   if it fails to do anything because it is prevented or hindered from
            doing it by any Law; or

      (c)   subject to the Corporations Act, if a person (other than a delegate
            or agent of the Servicer) fails to carry out an agreement with the
            Trustee or the Servicer in connection with the Services (except when
            the failure is due to the Servicer's own neglect or default).

9.3   No liability for acts of certain persons

      If the Servicer relies in good faith on an opinion, advice, information or
      statement given to it, by a person the Servicer is not liable for any
      misconduct, mistake, oversight, error of judgment, forgetfulness or want
      of prudence on the part of that person, except:

      (a)   when the person is not independent from the Servicer; or

      (b)   it would not be reasonable to rely upon the opinion, advice,
            information or statement from the person who gives it; or

      (c)   where that person is a delegate or agent of the Servicer.

      A person will be regarded as independent notwithstanding that the person
      acts or has acted as adviser to the Servicer so long as separate
      instructions are given by the Servicer to that person.

9.4   No liability for loss etc

      The Servicer is not liable:

      (a)   for any loss, cost, liability or expense arising out of the exercise
            or non-exercise of a discretion by the Trustee or the Trust Manager
            or the act or omission of the Trustee or the Trust Manager except to
            the extent that it is caused by the Servicer's own fraud, negligence
            or breach of duty or contract; or

      (b)   for any loss, cost, liability or expense caused by its failure to
            check any information, document, form or list supplied or purported
            to be supplied to it by the Trustee or the Trust Manager except to
            the extent that the loss is caused by the Servicer's own fraud,
            negligence or breach of duty or contract.

9.5   Method of claiming under indemnity

      The Servicer shall not be obliged to pay any indemnity under this
      agreement, unless:

      (a)   the Trustee first establishes that there has been a breach that has
            caused loss;

      (b)   the indemnity claimed represents no more than the loss incurred as a
            result of the breach; and

      (c)   the Trustee first gives the Servicer a written notice specifying:

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            (i)   the quantum of the claim; and

            (ii)  the basis of the claim.

9.6   Time of Payment

      The Servicer shall pay any amount it is required to pay under this Clause
      within 7 Business Days of receipt of notice under Clause 9.5.

10.   Representations and warranties

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

10.1  Representations and Warranties

      [Each of Westpac, in its capacity as an Approved Seller, and the Servicer
      makes the representations and warranties in Clause 32 of the Master Trust
      Deed in relation to itself for the benefit of the Trustee.]

10.2  Reliance

      The Servicer acknowledges that the Trustee has entered into this agreement
      in reliance on the representations and warranties in Clause 10.1.

10.3  Survival of Representations and Indemnities

      (a)   All representations and warranties in a Transaction Document survive
            the execution and delivery of the Transaction Documents.

      (b)   Each indemnity in this agreement:

            (i)   is a continuing obligation;

            (ii)  is a separate and independent obligation; and

            (iii) survives termination or discharge of this agreement.

11.   Westpac and the Servicer may act as banker

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

      Each of Westpac and the Servicer may (without having to account to the
      Trustee) engage in any kind of banking, finance, trust or other business
      permitted under any law with any Obligor as if, in the case of Westpac, it
      did not have obligations under this agreement, and, in the case of the
      Servicer, it were not the Servicer. Neither Westpac, in its capacity as an
      Approved Seller, nor the Servicer shall not be required to account to the
      Trustee for any moneys received by it on any account that is unrelated to
      Receivables and Receivable Securities or the Services.

12.   Administrative provisions

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

12.1  Notices

      All notices, requests, demands, consents, approvals or agreements to or by
      a party to this agreement:

      (a)   must be in writing;

      (b)   must be signed by an Authorised Signatory of the sender; and

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      (c)   will be taken to be duly given or made (in the case of delivery in
            person or by post or facsimile transmission) when delivered,
            received or left at the address of the recipient shown in this
            agreement or to any other address which it may have notified the
            sender, but if delivery or receipt is on a day on which business is
            not generally carried on in the place to which the communication is
            sent or is later than 4 pm (local time), it will be taken to have
            been duly given or made at the commencement of business on the next
            day on which business is generally carried on in that place.

12.2  Governing Law and Jurisdiction

      This agreement is governed by the laws of the Australian Capital
      Territory. Each of the Servicer and the Trustee submits to the
      non-exclusive jurisdiction of courts exercising jurisdiction there.

12.3  Assignment

      No party may assign its rights under this agreement.

12.4  Amendment

      This agreement can only be amended in writing, and provided prior notice
      of any proposed amendment is given to the Designated Rating Agency.

12.5  Severability Clause

      Any provisions of any Transaction Document which are prohibited or
      unenforceable in any jurisdiction are ineffective to the extent of the
      prohibition or unenforceability. That does not invalidate the remaining
      provisions of that Transaction Document nor affect the validity or
      enforceability of that provision in any other jurisdiction.

12.6  Costs and Expenses

      (a)   (Trustees costs and expenses) On demand each of Westpac, in its
            capacity as an Approved Seller, and the Servicer shall reimburse the
            Trustee for the reasonable expenses of the Trustee (as applicable)
            in relation to any enforcement of this agreement against it
            including in each case legal costs and expenses on a full indemnity
            basis and each party shall bear their own costs (other than legal
            costs) relating to the preparation execution and completion of this
            agreement;

      (b)   (Stamp duty) In addition, the Servicer shall pay all stamp and
            registration Taxes (including fines and penalties) which may be
            payable or determined to be payable in relation to the execution,
            delivery, performance or enforcement of this agreement.

      (c)   (Services costs and expenses) In accordance with the Series Notice,
            the Trustee shall reimburse the Servicer for the reasonable expenses
            of the Servicer (as applicable) in relation to any enforcement of
            this agreement including in each case legal costs and expenses on a
            full indemnity basis.

12.7  Waivers: Remedies Cumulative

      (a)   No failure on the part of a party to exercise and no delay in
            exercising any right, power or remedy under any Transaction Document
            operates as a waiver. Nor does any single or

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            partial exercise of any right, power or remedy preclude any other or
            further exercise of that or any other right, power or remedy.

      (b)   The rights, powers and remedies provided to the Trustee in the
            Transaction Documents are in addition to any right, power or remedy
            provided by law.

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Executed in Canberra

Each attorney executing this agreement states that he has no notice of
revocation or suspension of his power of attorney.

WESTPAC

SIGNED on behalf of              )
WESTPAC BANKING CORPORATION      )
                                 )
by its attorney                  )
in the presence of:              )
                                         ---------------------------------------
                                         Signature

----------------------------------       ---------------------------------------
Witness                                  Print name

----------------------------------
Print name

TRUSTEE

SIGNED on behalf of              )
WESTPAC SECURITIES               )
ADMINISTRATION LIMITED           )
by its attorney                  )
in the presence of:              )
                                         ---------------------------------------
                                         Signature

----------------------------------       ---------------------------------------
Witness                                  Print name

----------------------------------
Print name

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                                                                         Page 23
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TRUST MANAGER

SIGNED on behalf of              )
WESTPAC SECURITISATION           )
MANAGEMENT PTY LIMITED           )
by its attorney                  )
in the presence of:              )
                                         ---------------------------------------
                                         Signature

----------------------------------       ---------------------------------------
Witness                                  Print name

----------------------------------
Print name

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                                                                         Page 24
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Schedule 1

RECEIVABLES REGISTER INFORMATION
--------------------------------------------------------------------------------

The Receivables Register shall contain the following information in relation to
each Mortgage.

1.    Name and address of the relevant Obligor(s).

2.    Account/reference number of the loan under the relevant loan document,
      letter of offer or terms and conditions.

3.    The title reference for the relevant Mortgaged Property.

4.    Such other information as the Servicer and the Trustee may agree from time
      to time.

5.    The registered dealing number of that Mortgage from the relevant Land
      Titles Office together with:

      (a)   in respect of Mortgaged Property in New South Wales, the volume and
            folio number(s) for the Mortgaged Property;

      (b)   in respect of Mortgaged Property in Queensland, a description of the
            lot, county, parish and title reference(s) of the Mortgaged
            Property;

      (c)   in respect of Mortgaged Property in Western Australia:

            (i)   lot and diagram/plan/strata plan number(s) or location name
                  and number(s); and

            (ii)  volume and folio number(s) or crown lease number(s);

      (d)   in respect of Mortgaged Property in South Australia, the volume and
            folio number(s) for the Mortgaged Property;

      (e)   in respect of Mortgaged Property in Tasmania, the volume and folio
            number(s) for the Mortgaged Property;

      (f)   in respect of Mortgaged Property in the Australian Capital Territory
            district/division, section, block, unit, volume and folio number(s)
            for the Mortgaged Property;

      (g)   in respect of Mortgaged Property in the Northern Territory, the
            Receivables Register, volume, folio, location, parcel, plan and unit
            for the Mortgaged Property;

      (h)   in respect of Mortgaged Property in Victoria, the volume and folio
            number(s) for the Mortgaged Property.

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                                                                         Page 25
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SCHEDULE 2

AUDIT
--------------------------------------------------------------------------------

1.    Each audit referred to in Clause 3.3 shall involve a review of the
      following:

      (a)   the custodial procedures adopted by the Servicer;

      (b)   that the Relevant Documents are capable of identification,
            segregated by reference to the relevant Portfolio of Receivables and
            from other mortgage title documents held by the Servicer;

      (c)   that controls exist such that the Relevant Documents may not be
            removed or tampered with except with appropriate authorisation; and

      (d)   that an appropriate tracking system is in place such that the
            location of the Relevant Documents can be detected at any time.

2.    The Auditor will review a sample of the Security Packets and confirm that
      those Security Packets contain the Relevant Documents which the Series
      Notice for the Relevant Trust indicates that they should (including, as a
      minimum, the Receivable Security documents, and any Certificate of Title
      if issued).

3.    The Auditor's certificate referred to in Clause 3.3 will set out whether
      any errors detected by the Auditor in the relevant audit were the result
      of isolated non-compliance with the control system established by the
      Servicer under this agreement or result from a weakness in that control
      system.

4.    The Auditor's certificate referred to in Clause 3.3 will grade the
      custodial performance of the Servicer under this agreement based on the
      following grades.

      (A)   Good - All control procedures and accuracy of information in respect
            of Relevant Documents completed without exception, other than
            immaterial and occasional variances.

      (B)   Satisfactory - Minor exceptions to compliance with control
            procedures and accuracy of information in respect of Relevant
            Documents

      (C)   Improvement required - Base internal controls are in place but a
            number of issues were identified that need to be resolved for
            controls to be considered adequate; and testing of the relevant
            information in respect of Relevant Documents identified a number of
            minor exceptions to compliance which are the result of
            non-compliance with the control system

      (D)   Adverse - Major deficiencies in internal controls and the relevant
            information in respect of the Relevant Documents were identified.

--------------------------------------------------------------------------------
                                                                         Page 26EXHIBIT 4(Y)

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

                                 FPL GROUP, INC.

                               -----------------,
                      as Collateral Agent, Custodial Agent
                           and Securities Intermediary

                                       AND

                            ------------------------
                           as Purchase Contract Agent

                                PLEDGE AGREEMENT

                       DATED AS OF ____________ __, ______

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

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

RECITALS      .................................................................1
ARTICLE I. Definitions.........................................................2
ARTICLE II. Pledge; Control and Perfection.....................................5
SECTION 2.1   The Pledge.......................................................5
SECTION 2.2   Control and Perfection...........................................7
ARTICLE III. Distributions on Pledged Collateral...............................8
ARTICLE IV. Substitution, Release, Repledge and Settlement of Debentures.......9
SECTION 4.1   Substitution for Debentures and the Creation of
              Type B Securities................................................9
SECTION 4.2   Substitution of Treasury Securities and the Creation of
              Type A Securities...............................................10
SECTION 4.3   Termination Event...............................................11
SECTION 4.4   Cash Settlement.................................................12
SECTION 4.5   Early Settlement................................................13
SECTION 4.6   Application of Proceeds Settlement..............................13
ARTICLE V.  Voting Rights-- Debentures........................................15
ARTICLE VI. Rights and Remedies; Distribution of the Debentures;  Tax
              Event Redemption................................................16
SECTION 6.1   Rights and Remedies of the Collateral Agent.....................16
SECTION 6.2   Tax Event Redemption............................................17
SECTION 6.3   Substitutions...................................................17
ARTICLE VII. Representations and Warranties; Covenants........................17
SECTION 7.1   Representations and Warranties..................................17
SECTION 7.2   Covenants.......................................................18
ARTICLE VIII. The Collateral Agent............................................19
SECTION 8.1   Appointment, Powers and Immunities..............................19
SECTION 8.2   Instructions of the Company.....................................20
SECTION 8.3   Reliance........................................................20
SECTION 8.4   Rights in Other Capacities......................................20
SECTION 8.5   Non-Reliance....................................................21
SECTION 8.6   Compensation and Indemnity......................................21
SECTION 8.7   Failure to Act..................................................21
SECTION 8.8   Resignation of Collateral Agent.................................22
SECTION 8.9   Right to Appoint Agent or Advisor...............................23
SECTION 8.10  Survival........................................................23
SECTION 8.11  Exculpation.....................................................23
ARTICLE IX. Amendment ........................................................23
SECTION 9.1   Amendment Without Consent of Holders............................23
SECTION 9.2   Amendment with Consent of Holders...............................24
SECTION 9.3   Execution of Amendments.........................................25
SECTION 9.4   Effect of Amendments............................................25
SECTION 9.5   Reference to Amendments.........................................25

<PAGE>

ARTICLE X. Miscellaneous .....................................................26
SECTION 10.1  No Waiver.......................................................26
SECTION 10.2  Governing Law...................................................26
SECTION 10.3  Notices.........................................................26
SECTION 10.4  Successors and Assigns..........................................27
SECTION 10.5  Counterparts....................................................27
SECTION 10.6  Severability....................................................27
SECTION 10.7  Expenses, etc...................................................27
SECTION 10.8  Security Interest Absolute......................................27

EXHIBIT A     Instruction From Purchase Contract Agent To Collateral Agent...A-1
EXHIBIT B     Instruction To Purchase Contract Agent.........................B-1
EXHIBIT C     Instruction To Custodial Agent Regarding Remarketing...........C-1
EXHIBIT D     Instruction To Custodial Agent Regarding Withdrawal
              From Remarketing...............................................D-1

                                       ii
<PAGE>

     PLEDGE AGREEMENT, dated as of _________, ________ (this "Agreement"), by
and among FPL Group, Inc., a Florida corporation (the "Company"), as pledgee,
___________, not individually but solely as collateral agent (in such capacity,
together with its successors in such capacity, the "Collateral Agent"), as
custodial agent (in such capacity, together with its successors in such
capacity, the "Custodial Agent") and as a "securities intermediary" as defined
in Section 8-102(a)(14) of the Code (as defined herein) (in such capacity,
together with its successors in such capacity, the "Securities Intermediary"),
and ___________, not individually but solely as purchase contract agent and as
attorney-in-fact of the Holders (as defined in the Purchase Contract Agreement)
from time to time of the Securities (as hereinafter defined) (in such capacity,
together with its successors in such capacity, the "Purchase Contract Agent")
under the Purchase Contract Agreement (as hereinafter defined).

                                    RECITALS

     The Company and the Purchase Contract Agent are parties to the Purchase
Contract Agreement, dated as of the date hereof (as modified and supplemented
and in effect from time to time, the "Purchase Contract Agreement"), pursuant to
which there may be issued up to __________ new securities (the "New Securities")
of the Company, having a stated amount of $____ (the "Stated Amount") per New
Security.

     The New Securities will initially consist of (A) _______ units (referred to
as "Type A Securities") with a face amount, per Type A Security, equal to the
Stated Amount and (B) _________ units (referred to as "Type B Securities" and,
together with the Type A Securities, the "Securities") with a face amount, per
Type B Security, equal to the Stated Amount. Each Type A Security will initially
be comprised of (a) a stock purchase contract (as modified and supplemented and
in effect from time to time, a "Purchase Contract") under which (i) the Holder
will purchase from the Company on _________ (the "Purchase Contract Settlement
Date"), for an amount of cash equal to the Stated Amount, a number of newly
issued shares of common stock, $.01 par value per share (the "Common Stock"), of
the Company equal to the applicable Settlement Rate (as defined in the Purchase
Contract Agreement), and (ii) the Company will pay the Holder Contract
Adjustment Payments (as defined below) at the rate of __% of the Stated Amount
per annum, and (b) either beneficial ownership of a Debenture (as defined below)
or following the occurrence of a Tax Event Redemption, the Applicable Ownership
Interest in the Treasury Portfolio (as defined in the Purchase Contract
Agreement). Each Type B Security will initially be comprised of (a) a Purchase
Contract under which (i) the Holder will purchase from the Company on the
Purchase Contract Settlement Date, for an amount in cash equal to the Stated
Amount, a number of newly issued shares of Common Stock of the Company, equal to
the applicable Settlement Rate, and (ii) the Company will pay the Holder
Contract Adjustment Payments (as defined below) at the rate of __% of the Stated
Amount per annum, and (b) a ____ undivided beneficial interest in a zero-coupon
U.S. Treasury Security having a principal amount at maturity equal to [$1,000]
and maturing on ________ (CUSIP No. ________) (the "Treasury Securities").

     Pursuant to the terms of the Indenture (as defined below), FPL Group
Capital Inc, a Florida corporation and wholly-owned subsidiary of the Company
("FPL Group Capital"), will

<PAGE>

issue _____ ____ Debentures, Series due _______ (the "Debentures") in an
aggregate principal amount equal to the aggregate Stated Amount of all Type A
Securities.

     Pursuant to the terms of the Purchase Contract Agreement and the Purchase
Contracts, the Holders, from time to time, of the Securities have irrevocably
authorized the Purchase Contract Agent, as attorney-in-fact of such Holders,
among other things, to execute and deliver this Agreement on behalf of such
Holders and to grant the pledge provided hereby of the Debentures, any
Applicable Ownership Interest in the Treasury Portfolio and any Treasury
Securities to secure each Holder's obligations under the related Purchase
Contract, as provided herein and subject to the terms hereof. Upon such pledge,
the Debentures will be beneficially owned by the Holders but will be owned of
record by the Purchase Contract Agent subject to the Pledge hereunder, and the
Type B Securities (and the appropriate Applicable Ownership Interest in the
Treasury Portfolio) will be beneficially owned by the Holders but will be held
in book-entry form by the Securities Intermediary subject to the pledge
hereunder.

     Accordingly, the Company, the Collateral Agent, the Securities
Intermediary, the Custodial Agent and the Purchase Contract Agent, on its own
behalf and as attorney-in-fact of the Holders from time to time of the
Securities, agree as follows:

                                   ARTICLE I

                                   DEFINITIONS

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

          (a) the terms defined in this Article have the meanings assigned to
     them in this Article and include the plural as well as the singular;

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

          (c) terms not otherwise defined herein are used herein with the
     meaning ascribed to them in the Purchase Contract Agreement.

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

     "BANKRUPTCY CODE" means title 11 of the United States Code, or any other
law of the United States that from time to time provides a uniform system of
bankruptcy laws.

     "BUSINESS DAY" means any day other than a Saturday, a Sunday or any other
day on which banking institutions in The City of New York (in the State of New
York) are permitted or required by any applicable law to close.

                                       2
<PAGE>

     "CASH" means any coin or currency of the United States as at the time shall
be legal tender for payment of public and private debts.

     "CODE" has the meaning specified in Section 6.1 hereof.

     "COLLATERAL" has the meaning specified in Section 2.1 hereof.

     "COLLATERAL ACCOUNT" means the securities account (number _____) maintained
at ____________ in the name "__________,"as Purchase Contract Agent on behalf of
the Holders of Securities subject to the security interest of __________ as
Collateral Agent under the Agreement, for the benefit of FPL Group, Inc., as
pledgee and any successor account.

     "COLLATERAL AGENT" has the meaning specified in the first paragraph of this
Agreement.

     "COMMON STOCK" has the meaning specified in the Recitals.

     "COMPANY" means the Person named as the "Company" in the first paragraph of
this Agreement until a successor shall have become such, and thereafter
"Company" shall mean such successor.

     "CUSTODIAL AGENT" has the meaning specified in the first paragraph of this
Agreement.

     "DEBENTURES" has the meaning specified in the Recitals.

     "FPL GROUP CAPITAL" has the meaning specified in the Recitals.

     "INDENTURE" means the Indenture (For Unsecured Debt Securities), dated as
of June 1, 1999, between FPL Group Capital and the Indenture Trustee pursuant to
which the Debentures are to be issued, as originally executed and delivered and
as it may from time to time be supplemented or amended by one or more indentures
supplemental thereto entered into pursuant to the applicable provisions thereof
and shall include the terms of a particular series of securities established as
contemplated by Section 301 thereof.

     "INDENTURE TRUSTEE" means The Bank of New York, as trustee under the
Indenture until a successor is appointed thereunder, and thereafter means such
successor trustee.

     "INTERMEDIARY" means any entity that in the ordinary course of its business
maintains securities accounts for others and is acting in that capacity.

     "PERMITTED INVESTMENTS" means any one of the following which shall mature
not later than the next succeeding Business Day (i) any evidence of indebtedness
with an original maturity of 365 days or less issued, or directly and fully
guaranteed or insured, by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof or such indebtedness constitutes
a general obligation of it); (ii) deposits, certificates of deposit or
acceptances with an original maturity of 365 days or less of any institution
which is a member of the Federal Reserve System having combined capital and
surplus and undivided profits of not less than U.S. $200 million at the time of
deposit; (iii) investments with an original maturity of 365 days or less of any
Person that is

                                       3
<PAGE>

fully and unconditionally guaranteed by a bank referred to in clause (ii); (iv)
investments in commercial paper, other than commercial paper issued by the
Company or its affiliates, of any corporation incorporated under the laws of the
United States or any State thereof, which commercial paper has a rating at the
time of purchase at least equal to "A-1" by Standard & Poor's Ratings Group, a
division of McGraw-Hill Companies, Inc. ("S&P"), or at least equal to "P-1" by
Moody's Investors Service, Inc. ("Moody's"); and (v) investments in money market
funds registered under the Investment Company Act of 1940, as amended, rated in
the highest applicable rating category by S&P or Moody's.

     "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.

     "PLEDGE" has the meaning specified in Section 2.1 hereof.

     "PLEDGED DEBENTURES" has the meaning specified in Section 2.1 hereof.

     "PLEDGED SECURITIES" has the meaning specified in Section 2.1 hereof.

     "PLEDGED TREASURY SECURITIES" has the meaning specified in Section 2.1
hereof.

     "PROCEEDS" means all interest, dividends, cash, instruments, securities,
financial assets (as defined in Section 8-102(a)(9) of the Code) and other
property from time to time received, receivable or otherwise distributed upon
the sale, exchange, collection or disposition of the Collateral or any proceeds
thereof.

     "PURCHASE CONTRACT" has the meaning specified in the Recitals.

     "PURCHASE CONTRACT AGENT" has the meaning specified in the first paragraph
of this Agreement.

     "PURCHASE CONTRACT AGREEMENT" has the meaning specified in the Recitals.

     "REMAINING STATED AMOUNT" means $_____.

     "SECURITIES" has the meaning specified in the Recitals.

     "SECURITIES INTERMEDIARY" has the meaning specified in the first paragraph
of this Agreement.

     "SECURITY ENTITLEMENT" has the meaning set forth in Section 8-102(a)(17) of
the Code.

     "SEPARATE DEBENTURES" means any Debentures that are not Pledged Debentures.

     "STATED AMOUNT" has the meaning specified in the Recitals.

     "TRADES" means the Treasury/Reserve Automated Debt Entry System maintained
by the Federal Reserve Bank of New York pursuant to the TRADES Regulations.

                                       4
<PAGE>

     "TRADES REGULATIONS" means the regulations of the United States Department
of the Treasury, published at 31 C.F.R. Part 357, as amended from time to time.
Unless otherwise defined herein, all terms defined in the TRADES Regulations are
used herein as therein defined.

     "TRANSFER" means, with respect to the Collateral and in accordance with the
instructions of the Collateral Agent, the Purchase Contract Agent or the Holder,
as applicable:

          (i)  except as otherwise provided in Section 2.1 hereof, in the case
               of Collateral consisting of securities which cannot be delivered
               by book-entry or which the parties agree are to be delivered in
               physical form, delivery in appropriate physical form to the
               recipient accompanied by any duly executed instruments of
               transfer, assignments in blank, transfer tax stamps and any other
               documents necessary to constitute a legally valid transfer to the
               recipient; and

          (ii) in the case of Collateral consisting of securities maintained in
               book-entry form by causing a "securities intermediary" (as
               defined in Section 8-102(a)(14) of the Code) to (i) credit a
               "security entitlement" (as defined in Section 8-102(a)(17) of the
               Code) with respect to such securities to a "securities account"
               (as defined in Section 8-501(a) of the Code) maintained by or on
               behalf of the recipient and (ii) to issue a confirmation to the
               recipient with respect to such credit. In the case of Collateral
               to be delivered to the Collateral Agent, the securities
               intermediary shall be the Securities Intermediary and the
               securities account shall be the Collateral Account.

     "TREASURY SECURITY" has the meaning specified in the Recitals.

     "VALUE" with respect to any item of Collateral on any date means, as to (i)
Debentures, the aggregate principal amount thereof, (ii) Cash, the face amount
thereof and (iii) Treasury Securities, the aggregate principal amount thereof at
maturity.

                                   ARTICLE II

                         PLEDGE; CONTROL AND PERFECTION

SECTION 2.1   THE PLEDGE

     The Holders from time to time acting through the Purchase Contract Agent,
as their attorney-in-fact, and the Purchase Contract Agent, as such
attorney-in-fact, hereby pledge and grant to the Collateral Agent, for the
benefit of the Company, as collateral security for the

                                       5
<PAGE>

performance when due by such Holders of their respective obligations under the
related Purchase Contracts, a security interest in all of the right, title and
interest of such Holders and the Purchase Contract Agent (a) in the Debentures
and Treasury Securities constituting a part of the Securities and any Treasury
Securities delivered in exchange for any Debentures, and any Debentures
delivered in exchange for any Treasury Securities, in accordance with Article IV
hereof, in each case that have been Transferred to or received by the Collateral
Agent and not released by the Collateral Agent to such Holders under the
provisions of this Agreement; (b) in payments made by Holders pursuant to
Section 4.4; (c) in the Collateral Account and all securities, financial assets,
Cash and other property credited thereto and all Security Entitlements related
thereto; (d) in the Applicable Ownership Interest in the Treasury Portfolio
purchased on behalf of the Holders of Type A Securities by the Collateral Agent
upon the occurrence of a Tax Event Redemption as provided in Section 6.2 and (e)
all Proceeds of the foregoing (all of the foregoing, collectively, the
"Collateral"). Prior to or concurrently with the execution and delivery of this
Agreement, the Purchase Contract Agent, on behalf of the initial Holders of the
Securities, shall cause the Debentures comprising a part of the Type A
Securities, and the Treasury Securities comprising a part of the Type B
Securities, to be Transferred to the Collateral Agent for the benefit of the
Company. Such Debentures shall be Transferred by physically delivering such
Debentures to the Collateral Agent endorsed in blank. Treasury Securities and
the Treasury Portfolio, as applicable, shall be Transferred to the Collateral
Account maintained by the Collateral Agent at the Securities Intermediary by
book-entry transfer to the Collateral Account in accordance with the TRADES
Regulations and other applicable law and by the notation by the Securities
Intermediary on its books that a Security Entitlement with respect to such
Treasury Securities or Treasury Portfolio, has been credited to the Collateral
Account. For purposes of perfecting the Pledge under applicable law, including,
to the extent applicable, the TRADES Regulations or the Uniform Commercial Code
as adopted and in effect in any applicable jurisdiction, the Collateral Agent
shall be the agent of the Company as provided herein. The pledge provided in
this Section 2.1 is herein referred to as the "Pledge" and the Debentures,
Treasury Securities or Treasury Portfolio subject to the Pledge, excluding any
Debentures or Treasury Securities or interest in the Treasury Portfolio released
from the Pledge as provided in Article IV hereof, are hereinafter referred to as
"Pledged Debentures", the "Pledged Treasury Securities," or "Pledged Applicable
Ownership Interest in the Treasury Portfolio," respectively, and collectively,
the "Pledged Securities." Subject to the Pledge and the provisions of Section
2.2 hereof, the Holders from time to time shall have full beneficial ownership
of the Collateral. The Collateral Agent shall have the right to have the
Debentures or any other Securities held in physical form reregistered in its
name or in the name of its agent or the Securities Intermediary and credited to
the Collateral Account.

     Except as may be required in order to release Debentures (or if a Tax Event
Redemption has occurred, the Applicable Ownership Interest in the Treasury
Portfolio) or Treasury Securities in connection with a Holder's election to
convert its investment from Type A Securities to Type B Securities, or from Type
B Securities to Type A Securities, as the case may be, or except as otherwise
required to release Pledged Securities as specified herein, neither the
Collateral Agent nor the Securities Intermediary shall relinquish physical
possession of any certificate evidencing Debentures (or if a Tax Event
Redemption has occurred, the Applicable Ownership Interest in the Treasury
Portfolio) or Treasury Securities prior to the termination of this Agreement. If
it becomes necessary for the Collateral Agent to relinquish physical possession
of a certificate in order to release a portion of the Debentures evidenced
thereby from the Pledge,

                                       6
<PAGE>

the Collateral Agent shall use its best efforts to obtain physical possession of
a replacement certificate evidencing any Debentures remaining subject to the
Pledge hereunder registered to it or endorsed in blank within ten days of the
date it relinquished possession. The Collateral Agent shall promptly notify the
Company of its failure to obtain possession of any such replacement certificate
as required hereby.

SECTION 2.2   CONTROL AND PERFECTION

          (a)  In connection with the Pledge granted in Section 2.1, and subject
to the other provisions of this Agreement, the Holders from time to time acting
through the Purchase Contract Agent, as their attorney-in-fact, hereby authorize
and direct the Securities Intermediary (without the necessity of obtaining the
further consent of the Purchase Contract Agent or any of the Holders), and the
Securities Intermediary agrees, to comply with and follow any instructions and
entitlement orders (as defined in Section 8-102(a)(8) of the Code) that the
Collateral Agent on behalf of the Company may give in writing with respect to
the Collateral Account, the Collateral credited thereto and any Security
Entitlements with respect to any thereof. Such instructions and entitlement
orders may, without limitation, direct the Securities Intermediary to transfer,
redeem, sell, liquidate, assign, deliver or otherwise dispose of the Debentures,
the Treasury Securities, the Treasury Portfolio and any Security Entitlements
with respect thereto and to pay and deliver any income, proceeds or other funds
derived therefrom to the Company. The Purchase Contract Agent and the Holders
from time to time, acting through the Purchase Contract Agent, each hereby
further authorize and direct the Collateral Agent, as Agent of the Company, to
itself issue instructions and entitlement orders, and to otherwise take action,
with respect to the Collateral Account, the Collateral credited thereto and any
Security Entitlements with respect thereto, pursuant to the terms and provisions
hereof, all without the necessity of obtaining the further consent of the
Purchase Contract Agent or any of the Holders. The Collateral Agent shall be the
Agent of the Company and shall act as directed in writing by the Company.
Without limiting the generality of the foregoing, the Collateral Agent shall
issue entitlement orders to the Securities Intermediary when and as directed by
the Company.

          (b)  The Securities Intermediary hereby confirms and agrees that:
(i) all securities or other property underlying any financial assets credited to
the Collateral Account shall be registered in the name of the Securities
Intermediary, indorsed to the Securities Intermediary or in blank or credited to
another Collateral Account maintained in the name of the Securities Intermediary
and in no case will any financial asset credited to the Collateral Account be
registered in the name of the Purchase Contract Agent, the Company or any
Holder, payable to the order of, or specially indorsed to, the Purchase Contract
Agent, the Collateral Agent, the Company or any Holder except to the extent the
foregoing have been specially indorsed to the Securities Intermediary or in
blank; (ii) all property delivered to the Securities Intermediary pursuant to
this Pledge Agreement (including, without limitation, any Debentures, the
Treasury Portfolio or Treasury Securities) will be promptly credited to the
Collateral Account; (iii) the Collateral Account is an account to which
financial assets are or may be credited, and the Securities Intermediary shall,
subject to the terms of this Agreement, treat the Purchase Contract Agent as
entitled to exercise the rights of any financial asset credited to the
Collateral Account; (iv) the Securities Intermediary has not entered into, and
until the termination of the this Agreement will not enter into, any agreement
with any other Person relating to the Collateral Account and/or any financial
assets credited thereto pursuant to which it has agreed to comply

                                       7
<PAGE>

with entitlement orders (as defined in Section 8-102(a)(8) of the Code) of such
other Person; and (v) the Securities Intermediary has not entered into, and
until the termination of this Agreement will not enter into, any agreement with
the Company, the Collateral Agent, the Purchase Contract Agent or the Holders of
the Securities purporting to limit or condition the obligation of the Securities
Intermediary to comply with entitlement orders as set forth in this Section 2.2.

          (c)  The Securities Intermediary hereby agrees that each item of
property (whether investment property, financial asset, security, instrument or
Cash) credited to the Collateral Account shall be treated as a "financial asset"
within the meaning of Section 8-102(a)(9) of the Code.

          (d)  In the event of any conflict between this Agreement (or any
portion thereof) and any other agreement now existing or hereafter entered into,
the terms of this Agreement shall prevail.

          (e)  The Purchase Contract Agent hereby irrevocably constitutes and
appoints the Collateral Agent and the Company, and each of them severally, with
full power of substitution, as the Purchase Contract Agent's attorney-in-fact to
take on behalf of, and in the name, place and stead of the Purchase Contract
Agent and the Holders, any action necessary or desirable to perfect and to keep
perfected the security interest in the Collateral referred to in Section 2.1.
The grant of such power-of-attorney shall not be deemed to require of the
Collateral Agent any specific duties or obligations not otherwise assumed by the
Collateral Agent hereunder.

                                  ARTICLE III.

                       DISTRIBUTIONS ON PLEDGED COLLATERAL

     So long as the Purchase Contract Agent is the registered owner of the
Pledged Debentures, it shall receive all payments thereon. If the Pledged
Debentures are reregistered, such that the Collateral Agent becomes the
registered holder, all payments of principal or interest on such Pledged
Debentures, together with any payments of principal or interest or cash
distributions in respect of any other Pledged Securities received by the
Collateral Agent that are properly payable hereunder shall be paid by the
Collateral Agent by wire transfer in same day funds:

               (i)  In the case of (A) payment of interest with respect to the
Pledged Debentures or cash distributions on the appropriate Pledged Applicable
Ownership Interest in the Treasury Portfolio (as specified in clause ___________
of the term "_________" in the Purchase Contract Agreement), as the case may be,
and (B) any payments of principal with respect to any Debentures or the
appropriate Applicable Ownership Interest (as specified in clause _______ of the
definition of such term) in the Treasury Portfolio, as the case may be, that
have been released from the Pledge pursuant to Section 4.3 hereof, to the
Purchase Contract Agent, for the benefit of the relevant Holders of Type A
Securities, to the account designated by the Purchase Contract Agent for such
purpose, no later than 2:00 p.m., New York City time, on the Business Day such
payment is received by the Collateral Agent (provided that in the event such
payment is received by the Collateral Agent on a day that is not a Business Day
or after 12:30 p.m., New York City

                                       8
<PAGE>

time, on a Business Day, then such payment shall be made no later than
10:30 a.m., New York City time, on the next succeeding Business Day);

               (ii)  In the case of any principal payments with respect to any
Treasury Securities that have been released from the Pledge pursuant to Section
4.3 hereof, to the Holders of the Type B Securities to the accounts designated
by them in writing for such purpose no later than 2:00 p.m., New York City time,
on the Business Day such payment is received by the Collateral Agent (provided
that in the event such payment is received by the Collateral Agent on a day that
is not a Business Day or after 12:30 p.m., New York City time, on a Business
Day, then such payment shall be made no later than 10:30 a.m., New York City
time, on the next succeeding Business Day); and

               (iii)  In the case of payments of the principal of any Pledged
Debentures or on the appropriate Pledged Applicable Ownership Interest (as
specified in clause ________ of the definition of such term) in the Treasury
Portfolio, as the case may be, or the principal of any Pledged Treasury
Securities, to the Company on the Purchase Contract Settlement Date in
accordance with the procedure set forth in Section 4.6(a) or 4.6(b) hereof, in
full satisfaction of the respective obligations of the Holders under the related
Purchase Contracts.

All payments received by the Purchase Contract Agent as provided herein shall be
applied by the Purchase Contract Agent pursuant to the provisions of the
Purchase Contract Agreement. If, notwithstanding the foregoing, the Purchase
Contract Agent shall receive any payments of principal on account of any
Debenture or, if applicable, the appropriate Applicable Ownership Interest (as
specified in clause _________ of the definition of such term) in the Treasury
Portfolio that, at the time of such payment, is a Pledged Debenture or the
appropriate Pledged Applicable Ownership Interest in the Treasury Portfolio, as
the case may be, or a Holder of Type B Securities shall receive any payments of
principal on account of any Treasury Securities that, at the time of such
payment, are Pledged Treasury Securities, the Purchase Contract Agent or such
Holder, as the case may be, shall transfer the Proceeds of such payment of
principal on such Pledged Debenture, appropriate Pledged Applicable Ownership
Interest in the Treasury Portfolio, or Pledged Treasury Securities, as the case
may be, to the Collateral Agent and the Collateral Agent shall hold such
Proceeds for the benefit of the Company as Collateral for the performance when
due by such Holder of its obligations under the related Purchase Contracts.

                                  ARTICLE IV.

          SUBSTITUTION, RELEASE, REPLEDGE AND SETTLEMENT OF DEBENTURES

SECTION 4.1   SUBSTITUTION FOR DEBENTURES AND THE CREATION OF TYPE B SECURITIES

     At any time on or prior to the fifth Business Day immediately preceding the
Purchase Contract Settlement Date (unless a Tax Event Redemption has occurred),
a Holder of Type A Securities shall have the right to substitute Treasury
Securities for the Pledged Debentures securing such Holder's obligations under
the Purchase Contract(s) comprising a part of its Type A Securities in integral
multiples of [20] by (a) Transferring to the Collateral Agent Treasury
Securities having a Value equal to the aggregate principal amount of the Pledged
Debentures to be released and (b)(i) in the event that Contract Adjustment
Payments are at a

                                       9
<PAGE>

higher rate for Type B Securities than for Type A Securities, delivering to the
Purchase Contract Agent Cash in an amount equal to the excess of the Contract
Adjustment Payments that would have accrued since the last Payment Date through
the date of substitution on the Type B Securities being created by the Holder,
over the Contract Adjustment Payments that have accrued over the same time
period on the related Type A Securities, which amount the Purchase Contract
Agent shall promptly remit to the Company, and (ii) delivering the related Type
A Securities to the Purchase Contract Agent, accompanied by a notice,
substantially in the form of Exhibit B hereto, to the Purchase Contract Agent
stating that such Holder has Transferred Treasury Securities to the Collateral
Agent pursuant to clause (a) above (stating the Value of the Treasury Securities
Transferred by such Holder) and requesting that the Purchase Contract Agent
instruct the Collateral Agent to release from the Pledge the Pledged Debentures
related to such Type A Securities. The Purchase Contract Agent shall instruct
the Collateral Agent in the form provided in Exhibit A; provided, however, that
if a Tax Event Redemption has occurred and the Treasury Portfolio has become a
component of the Type A Securities, Holders of Type A Securities may make such
substitution only in integral multiples of [20] at any time on or prior to the
second Business Day immediately preceding the Purchase Contract Settlement Date.

     Upon receipt of the Treasury Securities from a Holder of and the related
instruction from the Purchase Contract Agent, the Collateral Agent shall release
the Pledged Debentures or the appropriate Pledged Applicable Ownership Interest
in the Treasury Portfolio, as the case may be, and shall promptly Transfer such
Pledged Debentures or the appropriate Pledged Applicable Ownership Interest in
the Treasury Portfolio, as the case may be, free and clear of any lien, pledge
or security interest created hereby, to the Purchase Contract Agent.

SECTION 4.2   SUBSTITUTION OF TREASURY SECURITIES AND THE CREATION OF
              TYPE A SECURITIES

     At any time on or prior to the fifth Business Day immediately preceding the
Purchase Contract Settlement Date (unless a Tax Event Redemption has occurred),
a Holder of Type B Securities shall have the right to establish or reestablish
Type A Securities consisting of the Purchase Contracts and Debentures in
integral multiples of [20] Type A Securities by (a) Transferring to the
Collateral Agent Debentures having a Value equal to the Value of the Pledged
Treasury Securities to be released and (b) delivering the related Type B
Securities to the Purchase Contract Agent accompanied by a notice, substantially
in the form of Exhibit B hereto, stating that the Holder has transferred
Debentures to the Collateral Agent pursuant to clause (a) above and requesting
that the Purchase Contract Agent instruct the Collateral Agent to release from
the Pledge the Pledged Treasury Securities related to such Type B Securities.
The Purchase Contract Agent shall instruct the Collateral Agent in the form
provided in Exhibit A; provided, however, that if a Tax Event Redemption has
occurred and the Treasury Portfolio has become a component of the Type A
Securities, Holders of Type B Securities may make such substitution only in
integral multiples of [20] Type B Securities, at any time on or prior to the
second Business Day immediately preceding the Purchase Contract Settlement Date
by (a) Transferring to the Collateral Agent the appropriate Applicable Ownership
Interest in the Treasury Portfolio having a Value equal to the Value of the
Pledged Treasury Securities to be released and (b) delivering the related Type B
Securities to the Purchase Contract Agent accompanied by a notice, substantially
in the form of Exhibit B hereto, stating that the Holder has transferred the
Applicable Ownership Interest in the Treasury Portfolio to the Collateral Agent
pursuant to

                                       10
<PAGE>

clause (a) above and requesting that the Purchase Contract Agent instruct the
Collateral Agent to release from the Pledge the Pledged Treasury Securities
related to such Type B Securities. Upon receipt of the Debentures or the
appropriate Applicable Ownership Interest in the Treasury Portfolio, as the case
may be, from such Holder and the instruction from the Purchase Contract Agent,
the Collateral Agent shall release the Treasury Securities and shall promptly
Transfer such Treasury Securities, free and clear of any lien, pledge or
security interest created hereby, to the Purchase Contract Agent.

SECTION 4.3   TERMINATION EVENT

     Upon receipt by the Collateral Agent of written notice from the Company or
the Purchase Contract Agent that there has occurred a Termination Event, the
Collateral Agent shall release all Collateral from the Pledge and shall promptly
Transfer any Pledged Debentures (or the appropriate Pledged Applicable Ownership
Interest in the Treasury Portfolio if a Tax Event Redemption has occurred) and
Pledged Treasury Securities to the Purchase Contract Agent for the benefit of
the Holders of the Type A Securities and the Type B Securities, respectively,
free and clear of any lien, pledge or security interest or other interest
created hereby.

     If such Termination Event shall result from the Company's becoming a debtor
under the Bankruptcy Code, and if the Collateral Agent shall for any reason fail
promptly to effectuate the release and Transfer of all Pledged Debentures, the
appropriate Pledged Applicable Ownership in the Treasury Portfolio or the
Pledged Treasury Securities, as the case may be, as provided by this Section
4.3, any Holder may, and the Purchase Contract Agent shall, upon receipt from
the Holders of reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by the Purchase Contract Agent in compliance
with this paragraph, (i) use its reasonable best efforts to obtain an opinion of
a nationally recognized law firm reasonably acceptable to the Collateral Agent
to the effect that, as a result of the Company's being the debtor in such a
bankruptcy case, the Collateral Agent will not be prohibited from releasing or
Transferring the Collateral as provided in this Section 4.3, and shall deliver
such opinion to the Collateral Agent within ten days after the occurrence of
such Termination Event, and if (y) any such Holder or the Purchase Contract
Agent shall be unable to obtain such opinion within ten days after the
occurrence of such Termination Event or (z) the Collateral Agent shall continue,
after delivery of such opinion, to refuse to effectuate the release and Transfer
of all Pledged Debentures, the appropriate Pledged Applicable Ownership in the
Treasury Portfolio or the Pledged Treasury Securities, as the case may be, as
provided in this Section 4.3, then any Holder may, and the Purchase Contract
Agent shall within fifteen days after the occurrence of such Termination Event
commence an action or proceeding in the court with jurisdiction of the Company's
case under the Bankruptcy Code seeking an order requiring the Collateral Agent
to effectuate the release and transfer of all Pledged Debentures, the
appropriate Pledged Applicable Ownership in the Treasury Portfolio or of the
Pledged Treasury Securities, as the case may be, as provided by this Section 4.3
or (ii) commence an action or proceeding in the court with jurisdiction of the
Company's case under the Bankruptcy Code like that described in subsection
(i)(z) hereof within ten days after the occurrence of such Termination Event.

                                       11
<PAGE>

SECTION 4.4   CASH SETTLEMENT

          (a)  Upon receipt by the Collateral Agent of (i) a notice from the
Purchase Contract Agent promptly after the receipt by the Purchase Contract
Agent of such notice that a Holder of an Type A Securities or Type B Securities
has elected, in accordance with the procedures specified in Section 5.4(a)(i) or
(d)(i) of the Purchase Contract Agreement, respectively, to settle its Purchase
Contract with Cash and (ii) payment by such Holder of the amount required to
settle the Purchase Contract on or prior to 11:00 a.m., New York City time, on
the Business Day immediately preceding the Purchase Contract Settlement Date in
lawful money of the United States by certified or cashiers' check or wire
transfer in immediately available funds payable to or upon the order of the
Company, then the Collateral Agent shall promptly invest any Cash received from
a Holder in connection with a Cash Settlement in Permitted Investments. Upon
receipt of the proceeds upon the maturity of the Permitted Investments on the
Purchase Contract Settlement Date, the Collateral Agent shall pay the portion of
such proceeds and deliver any certified or cashiers' checks received, in an
aggregate amount equal to the Purchase Price, to the Company on the Purchase
Contract Settlement Date, and shall distribute any funds in respect of the
interest earned from the Permitted Investments to the Purchase Contract Agent
for payment to the relevant Holder.

          (b)  If a Holder of Type A Securities fails to notify the Purchase
Contract Agent of its intention to make a Cash Settlement in accordance with
Section 5.4(a)(i) of the Purchase Contract Agreement, such failure shall
constitute a default under the Purchase Contract Agreement and hereunder, and
the Holder shall be deemed to have consented to the disposition of the Pledged
Debentures pursuant to the remarketing as described in Section 5.4(b) of the
Purchase Contract Agreement, which is incorporated herein by reference. If a
Holder of Type A Securities does notify the Agent as provided in
Section 5.4(a)(i) of the Purchase Contract Agreement of its intention to make a
Cash Settlement, but fails to make such payment as required by
Section 5.4(a)(ii) of the Purchase Contract Agreement, such failure shall
constitute a default under the Purchase Contract and hereunder, and the pledged
Debentures of such a Holder will not be remarketed but instead the Collateral
Agent, for the benefit of the Company, will exercise its rights as a secured
party with respect to such Debentures at the direction of the Company to retain
or dispose of the Collateral in accordance with applicable law. In addition, in
the event of a Failed Remarketing as described in Section 5.4(b) of the Purchase
Contract Agreement, such Failed Remarketing shall constitute a default hereunder
by such Holder, and the Collateral Agent, for the benefit of the Company, will
also exercise its rights as a secured party with respect to such Debentures at
the direction of the Company to retain or dispose of the Collateral in
accordance with applicable law.

          (c)  If a Holder of a Type B Securities fails to notify the Purchase
Contract Agent of such Holder's intention to make a Cash Settlement in
accordance with Section 5.4(d)(i) of the Purchase Contract Agreement, or if a
Holder of a Type B Securities does notify the Agent as provided in
paragraph 5.4(d)(i) of the Purchase Contract Agreement of its intention to make
a Cash Settlement, but fails to make such payment as required by
paragraph 5.4(d)(ii) of the Purchase Contract Agreement, such failure shall
constitute a default under the Purchase Contract and hereunder by such Holder
and upon the maturity of any Pledged Treasury Securities or the Pledged
Applicable Ownership Interest in the Treasury Portfolio, if any, held by the
Collateral Agent on the Business Day immediately preceding the Purchase Contract
Settlement Date, the

                                       12
<PAGE>

principal amount of the Pledged Treasury Securities or the appropriate Pledged
Applicable Ownership Interest in the Treasury Portfolio received by the
Collateral Agent shall, upon written direction of the Company, be invested
promptly in Permitted Investments. On the Purchase Contract Settlement Date, an
amount equal to the Purchase Price will be remitted to the Company as payment
thereof. In the event the sum of the proceeds from the related Pledged Treasury
Securities or the appropriate Pledged Ownership Interest in the Treasury
Portfolio, as the case may be, and the investment earnings earned from such
investments is in excess of the aggregate Purchase Price of the Purchase
Contracts being settled thereby, the Collateral Agent will distribute such
excess to the Purchase Contract Agent for the benefit of the Holder of the
related Type B Securities or Type A Securities when received.

SECTION 4.5   EARLY SETTLEMENT

     Upon written notice to the Collateral Agent by the Purchase Contract Agent
that a Holder of a Security has elected to effect Early Settlement of its entire
obligation under the Purchase Contract forming a part of such Security in
accordance with the terms of the Purchase Contract and the Purchase Contract
Agreement, and that the Purchase Contract Agent has received from such Holder,
and paid to the Company as confirmed in writing by the Company, the related
Early Settlement Amount pursuant to the terms of the Purchase Contract and the
Purchase Contract Agreement and that all conditions to such Early Settlement
have been satisfied, then the Collateral Agent shall release from the Pledge,
(a) the Pledged Debentures or the appropriate Pledged Applicable Ownership
Interest in the Treasury Portfolio in the case of a Holder of Type A Securities
or (b) Pledged Treasury Securities in the case of a Holder of Type B Securities,
in each case that had been components of such security, and shall transfer such
Pledged Debentures or the appropriate Pledged Applicable Ownership Interest in
the Treasury Portfolio or Pledged Treasury Securities, as the case may be, free
and clear of the Pledge created hereby, to the Purchase Contract Agent for the
benefit of such Holder.

SECTION 4.6   APPLICATION OF PROCEEDS SETTLEMENT

          (a)  In connection with the Purchase Contract Settlement Date, in the
event a Holder of Type A Securities (if a Tax Event Redemption has not occurred)
has not elected to make an effective Cash Settlement by notifying the Purchase
Contract Agent in the manner provided for in paragraph 5.4(a)(i) in the Purchase
Contract Agreement or has not made an Early Settlement of the Purchase
Contract(s) underlying its Type A Securities, such Holder shall be deemed to
have elected to pay for the shares of Common Stock to be issued under such
Purchase Contract(s) from the Proceeds of the related Pledged Debentures. The
Collateral Agent shall, by 10:00 a.m., New York City time, on the fourth
Business Day immediately preceding the Purchase Contract Settlement Date,
without any instruction from such Holder of Type A Securities, present the
related Pledged Debentures to the Remarketing Agent for remarketing. Upon
receiving such Pledged Debentures, the Remarketing Agent, pursuant to the terms
of the Remarketing Agreement, will use its reasonable efforts to remarket such
Pledged Debentures on such date at a price of approximately ___% (but not less
than ___%) of the aggregate Value of such Pledged Debentures, plus accrued and
unpaid interest, if any, thereon. After deducting as the Remarketing Fee an
amount not exceeding ___ basis points (.__%) of the aggregate Value of the
Pledged Debentures from any amount of such Proceeds in excess of the aggregate
Value, plus such accrued and unpaid interest of the remarketed Pledged
Debentures, the Remarketing

                                       13
<PAGE>

Agent will remit the entire amount of the Proceeds of such remarketing to the
Collateral Agent. On the Purchase Contract Settlement Date, the Collateral Agent
shall apply that portion of the Proceeds from such remarketing equal to the
aggregate Value, to satisfy in full the obligations of such Holders of Type A
Securities to pay the Purchase Price to purchase the Common Stock under the
related Purchase Contracts. The remaining portion of such Proceeds, if any,
shall be distributed by the Collateral Agent to the Purchase Contract Agent for
payment to the Holders. If the Remarketing Agent advises the Collateral Agent in
writing that it cannot remarket the related Pledged Debentures of such Holders
of Type A Securities at a price not less than ___% of the aggregate Value of
such Pledged Debentures plus any accrued and unpaid interest, thus resulting in
a Failed Remarketing, the Collateral Agent, for the benefit of the Company will,
at the written direction of the Company, retain or dispose of the Pledged
Debentures in accordance with applicable law and satisfy in full, from any such
disposition or retention, such Holder's obligation to pay the Purchase Price for
the Common Stock.

          (b)  In the event a Holder of Type B Securities or Type A Securities
(if a Tax Event Redemption has occurred) has not made an Early Settlement of the
Purchase Contract(s) underlying its Type B Securities or Type A Securities, such
Holder shall be deemed to have elected to pay for the shares of Common Stock to
be issued under such Purchase Contract(s) from the Proceeds of the related
Pledged Treasury Securities or the Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be. On the Business Day immediately prior to
the Purchase Contract Settlement Date, the Collateral Agent shall, at the
written direction of the Purchase Contract Agent, invest the Cash proceeds of
the maturing Pledged Treasury Securities or the Pledged Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, in overnight Permitted
Investments. Without receiving any instruction from any such Holder of Type B
Securities or Type A Securities, the Collateral Agent shall apply the Proceeds
of the related Pledged Treasury Securities or Pledged Applicable Ownership
Interest in the Treasury Portfolio to the settlement of such Purchase Contracts
on the Purchase Contract Settlement Date.

     In the event the sum of the Proceeds from the related Pledged Treasury
Securities or related appropriate Pledged Applicable Ownership Interest in the
Treasury Portfolio and the investment earnings from the investment in overnight
Permitted Investments is in excess of the aggregate Purchase Price of the
Purchase Contracts being settled thereby, the Collateral Agent shall distribute
such excess, when received, to the Purchase Contract Agent for the benefit of
the Holders.

     Unless a Holder has made an Early Settlement, the Company shall not be
obligated to issue any shares of Common Stock in respect of the Purchase
Contract(s) or deliver any certificate therefor to the Holder unless it shall
have received payment in full of the Purchase Price for the shares of Common
Stock to be purchased thereunder.

          (c)  Pursuant to the Remarketing Agreement, on or prior to the fifth
Business Day immediately preceding the Purchase Contract Settlement Date, but no
earlier than the Payment Date immediately preceding the Purchase Contract
Settlement Date, holders of Separate Debentures may elect to have their Separate
Debentures remarketed by delivering their Separate Debentures, together with a
notice of such election, substantially in the form of Exhibit C hereto, to the
Custodial Agent. The Custodial Agent will hold such Separate Debentures in an
account

                                       14
<PAGE>

separate from the Collateral Account. A holder of Separate Debentures electing
to have its Separate Debentures remarketed will also have the right to withdraw
such election by written notice to the Custodial Agent, substantially in the
form of Exhibit D hereto, on or prior to the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, upon which notice the Custodial
Agent will return such Separate Debentures to such holder. On the fourth
Business Day immediately preceding the Purchase Contract Settlement Date, the
Custodial Agent will deliver to the Remarketing Agent for remarketing all
Separate Debentures delivered to the Custodial Agent pursuant to this Section
4.6(c) and not withdrawn pursuant to the terms hereof prior to such date. The
portion of the proceeds from such remarketing equal to the aggregate Value of
such Separate Debentures will automatically be remitted by the Remarketing Agent
to the Custodial Agent for the benefit of the holders of such Separate
Debentures. In addition, after deducting as the Remarketing Fee an amount not
exceeding ___ basis points (.___%) of the Value of the remarketed Separate
Debentures, from any amount of such proceeds in excess of the aggregate Value of
the remarketed Separate Debentures plus any accrued and unpaid interest, the
Remarketing Agent will remit to the Custodial Agent the remaining portion of the
proceeds, if any, for the benefit of such holders. If, despite using its
reasonable efforts, the Remarketing Agent advises the Custodial Agent in writing
that it cannot remarket the related Separate Debentures of such holders at a
price not less than ___% of the aggregate Value of such Separate Debentures plus
accrued and unpaid interest and thus resulting in a Failed Remarketing, the
Remarketing Agent will promptly return such Separate Debentures to the Custodial
Agent for redelivery to such holders.

                                   ARTICLE V.

                           VOTING RIGHTS -- DEBENTURES

     The Purchase Contract Agent may exercise, or refrain from exercising, any
and all voting and other consensual rights pertaining to the Pledged Debentures
or any part thereof for any purpose not inconsistent with the terms of this
Agreement and in accordance with the terms of the Purchase Contract Agreement;
provided, that the Purchase Contract Agent shall not exercise or, as the case
may be, shall not refrain from exercising such right if, in the judgment of the
Company, such action would impair or otherwise have a material adverse effect on
the value of all or any of the Pledged Debentures; and provided, further, that
the Purchase Contract Agent shall give the Company and the Collateral Agent at
least five days' prior written notice of the manner in which it intends to
exercise, or its reasons for refraining from exercising, any such right. Upon
receipt of any notices and other communications in respect of any Pledged
Debentures, including notice of any meeting at which holders of Debentures are
entitled to vote or solicitation of consents, waivers or proxies of holders of
Debentures, the Collateral Agent shall use reasonable efforts to send promptly
to the Purchase Contract Agent such notice or communication, and as soon as
reasonably practicable after receipt of a written request therefor from the
Purchase Contract Agent, execute and deliver to the Purchase Contract Agent such
proxies and other instruments in respect of such Pledged Debentures (in form and
substance satisfactory to the Collateral Agent) as are prepared by the Purchase
Contract Agent with respect to the Pledged Debentures.

                                       15
<PAGE>

                                  ARTICLE VI.

              RIGHTS AND REMEDIES; DISTRIBUTION OF THE DEBENTURES;
                              TAX EVENT REDEMPTION

SECTION 6.1   RIGHTS AND REMEDIES OF THE COLLATERAL AGENT

          (a)  In addition to the rights and remedies specified in Section 4.4
hereof or otherwise available at law or in equity, after a default hereunder,
the Collateral Agent shall have all of the rights and remedies with respect to
the Collateral of a secured party under the Uniform Commercial Code (or any
successor thereto) as in effect in the State of New York from time to time (the
"Code") (whether or not the Code is in effect in the jurisdiction where the
rights and remedies are asserted) and the TRADES Regulations and such additional
rights and remedies to which a secured party is entitled under the laws in
effect in any jurisdiction where any rights and remedies hereunder may be
asserted. Wherever reference is made in this Agreement to any section of the
Code, such reference shall be deemed to include a reference to any provision of
the Code which is a successor to, or amendment of, such section. Without
limiting the generality of the foregoing, such remedies may include, to the
extent permitted by applicable law, (i) retention of the Pledged Debentures or
other Collateral in full satisfaction of the Holders' obligations under the
Purchase Contracts or (ii) sale of the Pledged Debentures or other Collateral in
one or more public or private sales and application of the proceeds in full
satisfaction of the Holders' obligations under the Purchase Contracts.

          (b)  Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, in the event the Collateral Agent is unable
to make payments to the Company on account of the appropriate Applicable
Ownership Interest (as specified in clause ________ of the definition of such
term) of the Treasury Portfolio or on account of principal payments of any
Pledged Treasury Securities as provided in Article III hereof in satisfaction of
the obligations of the Holder of the Securities of which such Pledged Treasury
Securities, or the appropriate Pledged Applicable Ownership Interest (as
specified in clause ________ of the definition of such term) of the Treasury
Portfolio, as applicable, is a part under the related Purchase Contracts, the
inability to make such payments shall constitute a default hereunder and the
Collateral Agent shall have and may exercise, with reference to such Pledged
Treasury Securities, or such appropriate Pledged Applicable Ownership Interest
(as specified in clause _____ of the definition of such term) of the Treasury
Portfolio, as applicable, and such obligations of such Holder, any and all of
the rights and remedies available to a secured party under the Code and the
TRADES Regulations after default by a debtor, and as otherwise granted herein or
under any other law.

          (c)  Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, the Collateral Agent is hereby irrevocably
authorized to receive and collect all payments of (i) principal of, or interest
on, the Pledged Debentures, (ii) the principal amount of the Pledged Treasury
Securities, or (iii) the appropriate Pledged Applicable Ownership Interest in
the Treasury Portfolio, subject, in each case, to the provisions of Article III,
and as otherwise granted herein.

          (d)  The Purchase Contract Agent individually and as attorney-in-fact
for each Holder of Securities, in the event such Holder becomes the Holder of
Type A Securities or Type B Securities, agrees that, from time to time, upon the
written request of the Collateral

                                       16
<PAGE>

Agent, the Purchase Contract Agent or such Holder shall execute and deliver such
further documents and do such other acts and things as the Collateral Agent may
reasonably request in order to maintain the Pledge, and the perfection and
priority thereof, and to confirm the rights of the Collateral Agent hereunder.
The Purchase Contract Agent shall have no liability to any Holder for executing
any documents or taking any such acts requested by the Collateral Agent
hereunder, except for liability for its own negligent act, its own negligent
failure to act or its own willful misconduct.

SECTION 6.2   TAX EVENT REDEMPTION

     Upon the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, the Collateral Agent will, upon the written
instruction of the Company and the Purchase Contract Agent, deliver the
Applicable Principal Amount of Pledged Debentures to the Indenture Trustee for
payment of the Redemption Price. The Collateral Agent shall, or in the event the
Pledged Debentures are registered in the name of the Purchase Contract Agent,
the Purchase Contract Agent shall, direct the Indenture Trustee to pay the
Redemption Price therefor payable on the Tax Event Redemption Date on or prior
to 12:30 p.m., New York City time, such Redemption Price to be paid by check or
wire transfer in immediately available funds at such place and to such account
as may be designated by the Collateral Agent. In the event the Collateral Agent
receives such Redemption Price, the Collateral Agent will, at the written
direction of the Company, apply an amount equal to the Redemption Amount of such
Redemption Price to purchase from the Quotation Agent, the Treasury Portfolio
and promptly remit the remaining portion of such Redemption Price to the
Purchase Contract Agent for payment to the Holders of Type A Securities. The
Collateral Agent shall Transfer the Treasury Portfolio to the Collateral Account
in the manner specified herein for Pledged Debentures to secure the obligation
of all Holders of Type A Securities to purchase Common Stock of the Company
under the Purchase Contracts constituting a part of such Type A Securities, in
substitution for the Pledged Debentures. Thereafter the Collateral Agent shall
have such security interests, rights and obligations with respect to the
Treasury Portfolio as it had in respect of the Pledged Debentures, as provided
in Articles II, III, IV, V and VI, and any reference herein to the Pledged
Debentures shall be deemed to be a reference to such Treasury Portfolio.

SECTION 6.3   SUBSTITUTIONS

     Whenever a Holder has the right to substitute Treasury Securities,
Debentures or the appropriate Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, for Collateral held by the Collateral Agent, such
substitution shall not constitute a novation of the security interest created
hereby.

                                  ARTICLE VII.

                    REPRESENTATIONS AND WARRANTIES; COVENANTS

SECTION 7.1   REPRESENTATIONS AND WARRANTIES

     The Holders from time to time, acting through the Purchase Contract Agent
as their attorney-in-fact (it being understood that the Purchase Contract Agent
shall not be liable for any

                                       17
<PAGE>

representation or warranty made by or on behalf of a
Holder), hereby represent and warrant to the Collateral Agent, which
representations and warranties shall be deemed repeated on each day a Holder
Transfers Collateral that:

                    (a)  such Holder has the power to grant a security
                         interest in and lien on the Collateral;

                    (b)  such Holder is the sole beneficial owner of the
                         Collateral and, in the case of Collateral
                         delivered in physical form, is the sole holder of
                         such Collateral and is the sole beneficial owner
                         of, or has the right to Transfer, the Collateral
                         it Transfers to the Collateral Agent, free and
                         clear of any security interest, lien, encumbrance,
                         call, liability to pay money or other restriction
                         other than the security interest and lien granted
                         under Article II hereof;

                    (c)  upon the Transfer of the Collateral to the
                         Collateral Account or physical delivery of the
                         Debentures to the Collateral Agent, the Collateral
                         Agent, for the benefit of the Company, will have a
                         valid and perfected first priority security
                         interest therein (assuming that any central
                         clearing operation or any Intermediary or other
                         entity not within the control of the Holder
                         involved in the Transfer of the Collateral,
                         including the Collateral Agent, gives the notices
                         and takes the action required of it hereunder and
                         under applicable law for perfection of that
                         interest and assuming the establishment and
                         exercise of control pursuant to Section 2.2
                         hereof); and

                    (d)  the execution and performance by the Holder of its
                         obligations under this Agreement will not result
                         in the creation of any security interest, lien or
                         other encumbrance on the Collateral other than the
                         security interest and lien granted under Article
                         II hereof or violate any provision of any existing
                         law or regulation applicable to it or of any
                         mortgage, charge, pledge, indenture, contract or
                         undertaking to which it is a party or which is
                         binding on it or any of its assets.

SECTION 7.2   COVENANTS

     The Holders from time to time, acting through the Purchase Contract Agent
as their attorney-in-fact (it being understood that the Purchase Contract Agent
shall not be liable for any

                                       18
<PAGE>

covenant made by or on behalf of a Holder), hereby covenant to the Collateral
Agent that for so long as the Collateral remains subject to the Pledge:

                    (a)  neither the Purchase Contract Agent nor such
                         Holders will create or purport to create or allow
                         to subsist any mortgage, charge, lien, pledge or
                         any other security interest whatsoever over the
                         Collateral or any part of it other than pursuant
                         to this Agreement; and

                    (b)  neither the Purchase Contract Agent nor such
                         Holders will sell or otherwise dispose (or attempt
                         to dispose) of the Collateral or any part of it
                         except for the beneficial interest therein,
                         subject to the pledge hereunder, transferred in
                         connection with the Transfer of the Securities.

                                 ARTICLE VIII.

                              THE COLLATERAL AGENT

     It is hereby agreed as follows:

SECTION 8.1   APPOINTMENT, POWERS AND IMMUNITIES

     The Collateral Agent shall act as agent for the Company hereunder with such
powers as are specifically vested in the Collateral Agent by the terms of this
Agreement, together with such other powers as are reasonably incidental thereto.
Each of the Collateral Agent, the Custodial Agent and the Securities
Intermediary: (a) shall have no duties or responsibilities except those
expressly set forth or incorporated in this Agreement and no implied covenants
or obligations shall be inferred from this Agreement against any of them, nor
shall any of them be bound by the provisions of any agreement by any party
hereto beyond the specific or incorporated terms hereof; (b) shall not be
responsible for any recitals contained in this Agreement, or in any certificate
or other document referred to or provided for in, or received by it under, this
Agreement, the Securities or the Purchase Contract Agreement (except as
specifically incorporated by reference herein), or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement
(other than as against the Collateral Agent, the Custodial Agent or the Security
Interest Intermediary), the Securities or the Purchase Contract Agreement or any
other document referred to or provided for herein (except as specifically
incorporated by reference herein) or therein or for any failure by the Company
or any other Person (except the Collateral Agent, the Custodial Agent or the
Securities Intermediary, as the case may be) to perform any of its obligations
hereunder or thereunder or for the perfection, priority or, except as expressly
required hereby, maintenance of any security interest created hereunder;
(c) shall not be required to initiate or conduct any litigation or collection
proceedings hereunder (except in the case of the Collateral Agent, pursuant to
directions furnished under Section 8.2 hereof, subject to Section 8.6 hereof);
(d) shall not be responsible for any action taken or omitted to be taken by it
hereunder or under any other document or instrument referred

                                       19
<PAGE>

to or provided for herein or in connection herewith or therewith, except for its
own negligence or willful misconduct; and (e) shall not be required to advise
any party as to selling or retaining, or taking or refraining from taking any
action with respect to, the Securities or other property deposited hereunder in
accordance with the terms hereof. Subject to the foregoing, during the term of
this Agreement, the Collateral Agent shall take all reasonable action in
connection with the safekeeping and preservation of the Collateral hereunder.

     No provision of this Agreement shall require the Collateral Agent, the
Custodial Agent or the Securities Intermediary to expend or risk its own funds
or otherwise incur any financial liability in the performance of any of its
duties hereunder. In no event shall the Collateral Agent, the Custodial Agent or
the Securities Intermediary be liable for any amount in excess of the Value of
the Collateral. Notwithstanding the foregoing, the Collateral Agent, the
Custodial Agent and Securities Intermediary, each in its individual capacity,
hereby waive any right of setoff, bankers lien, liens or perfection rights as
Securities Intermediary or any counterclaim with respect to any of the
Collateral.

SECTION 8.2   INSTRUCTIONS OF THE COMPANY

     The Company shall have the right, by one or more instruments in writing
executed and delivered to the Collateral Agent, the Custodial Agent or the
Securities Intermediary, as the case may be, to direct the time, method and
place of conducting any proceeding for the realization of any right or remedy
available to the Collateral Agent, or of exercising any power conferred on the
Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be, or to direct the taking or refraining from taking of any action
authorized by this Agreement; provided, however, that (i) such direction shall
not conflict with the provisions of any law or of this Agreement and (ii) the
Collateral Agent, the Custodial Agent and the Securities Intermediary shall be
adequately indemnified as provided herein. Nothing in this Section 8.2 shall
impair the right of the Collateral Agent in its discretion to take any action or
omit to take any action which it deems proper and which is not inconsistent with
such direction.

SECTION 8.3   RELIANCE

     Each of the Securities Intermediary, the Custodial Agent and the Collateral
Agent shall be entitled conclusively to rely upon any certification, order,
judgment, opinion, notice or other communication (including, without limitation,
any thereof by telephone, telecopy, telex or facsimile) believed by it to be
genuine and correct and to have been signed or sent by or on behalf of the
proper Person or Persons (without being required to determine the correctness of
any fact stated therein), and upon advice and statements of legal counsel and
other experts selected by the Collateral Agent, the Custodial Agent or the
Securities Intermediary, as the case may be. As to any matters not expressly
provided for by this Agreement, the Collateral Agent, the Custodial Agent and
the Securities Intermediary shall in all cases be fully protected in acting, or
in refraining from acting, hereunder in accordance with instructions given by
the Company in accordance with this Agreement.

                                       20
<PAGE>

SECTION 8.4   RIGHTS IN OTHER CAPACITIES

     The Collateral Agent, the Custodial Agent and the Securities Intermediary
and their affiliates may (without having to account therefor to the Company)
accept deposits from, lend money to, make their investments in and generally
engage in any kind of banking, trust or other business with the Purchase
Contract Agent and any Holder of Securities (and any of their respective
subsidiaries or affiliates) as if it were not acting as the Collateral Agent,
the Custodial Agent or the Securities Intermediary, as the case may be, and the
Collateral Agent, the Custodial Agent and the Securities Intermediary and their
affiliates may accept fees and other consideration from the Purchase Contract
Agent and any Holder of Securities without having to account for the same to the
Company; provided that each of the Securities Intermediary, the Custodial Agent
and the Collateral Agent covenants and agrees with the Company that it shall not
accept, receive or permit there to be created in favor of itself and shall take
no affirmative action to permit there to be created in favor of any other
Person, any security interest, lien or other encumbrance of any kind in or upon
the Collateral.

SECTION 8.5   NON-RELIANCE

     None of the Securities Intermediary, the Custodial Agent or the Collateral
Agent shall be required to keep itself informed as to the performance or
observance by the Purchase Contract Agent or any Holder of Securities of this
Agreement, the Purchase Contract Agreement, the Securities or any other document
referred to or provided for herein or therein or to inspect the properties or
books of the Purchase Contract Agent or any Holder of Securities. The Collateral
Agent, the Custodial Agent and the Securities Intermediary shall not have any
duty or responsibility to provide the Company with any credit or other
information concerning the affairs, financial condition or business of the
Purchase Contract Agent or any Holder of Securities (or any of their respective
affiliates) that may come into the possession of the Collateral Agent, the
Custodial Agent or the Securities Intermediary or any of their respective
affiliates.

SECTION 8.6   COMPENSATION AND INDEMNITY

     The Company agrees: (i) to pay each of the Collateral Agent and the
Custodial Agent from time to time such compensation as shall be agreed in
writing between the Company and the Collateral Agent or the Custodial Agent, as
the case may be, for all services rendered by each of them hereunder and (ii) to
indemnify the Collateral Agent, the Custodial Agent and the Securities
Intermediary for, and to hold each of them harmless from and against, any loss,
liability or reasonable out-of-pocket expense incurred without negligence,
willful misconduct or bad faith on its part, arising out of or in connection
with the acceptance or administration of its powers and duties under this
Agreement, including the reasonable out-of-pocket costs and expenses (including
reasonable fees and expenses of counsel) of defending itself against any claim
or liability in connection with the exercise or performance of such powers and
duties. The Collateral Agent, the Custodial Agent and the Securities
Intermediary shall each promptly notify the Company of any third party claim
which may give rise to indemnity hereunder and give the Company the opportunity
to participate in the defense of such claim with counsel reasonably satisfactory
to the indemnified party, and no such claim shall be settled without the written
consent of the Company, which consent shall not be unreasonably withheld.

                                       21
<PAGE>

SECTION 8.7   FAILURE TO ACT

     In the event of any ambiguity in the provisions of this Agreement or any
dispute between or conflicting claims by or among the parties hereto or any
other Person with respect to any funds or property deposited hereunder, the
Collateral Agent and the Custodial Agent shall be entitled, after prompt notice
to the Company and the Purchase Contract Agent, at its sole option, to refuse to
comply with any and all claims, demands or instructions with respect to such
property or funds so long as such dispute or conflict shall continue, and
neither the Collateral Agent nor the Custodial Agent shall be or become liable
in any way to any of the parties hereto for its failure or refusal to comply
with such conflicting claims, demands or instructions. The Collateral Agent and
the Custodial Agent shall be entitled to refuse to act until either (i) such
conflicting or adverse claims or demands shall have been finally determined by a
court of competent jurisdiction or settled by agreement between the conflicting
parties as evidenced in a writing, satisfactory to the Collateral Agent or the
Custodial Agent, as the case may be, or (ii) the Collateral Agent or the
Custodial Agent, as the case may be, shall have received security or an
indemnity satisfactory to the Collateral Agent or the Custodial Agent, as the
case may be, sufficient to save the Collateral Agent or the Custodial Agent, as
the case may be, harmless from and against any and all loss, liability or
reasonable out-of-pocket expense which the Collateral Agent or the Custodial
Agent, as the case may be, may without negligence, willful misconduct, or bad
faith on its part incur by reason of its acting. The Collateral Agent or the
Custodial Agent may in addition elect to commence an interpleader action or seek
other judicial relief or orders as the Collateral Agent or the Custodial Agent,
as the case may be, may deem necessary. Notwithstanding anything contained
herein to the contrary, neither the Collateral Agent nor the Custodial Agent
shall be required to take any action that is in its opinion contrary to law or
to the terms of this Agreement, or which would in its opinion subject it or any
of its officers, employees or directors to liability.

SECTION 8.8   RESIGNATION OF COLLATERAL AGENT

     Subject to the appointment and acceptance of a successor Collateral Agent
or Custodial Agent as provided below, (a) the Collateral Agent and the Custodial
Agent may resign at any time by giving notice thereof to the Company and the
Purchase Contract Agent as attorney-in-fact for the Holders of Securities, (b)
the Collateral Agent and the Custodial Agent may be removed at any time by the
Company and (c) if the Collateral Agent or the Custodial Agent fails to perform
any of its material obligations hereunder in any material respect for a period
of not less than 20 days after receiving written notice of such failure by the
Purchase Contract Agent and such failure shall be continuing, the Collateral
Agent or the Custodial Agent may be removed by the Purchase Contract Agent. The
Purchase Contract Agent shall promptly notify the Company of any removal of the
Collateral Agent pursuant to clause (c) of the immediately preceding sentence.
Upon any such resignation or removal, the Company shall have the right to
appoint a successor Collateral Agent or Custodial Agent, as the case may be. If
no successor Collateral Agent or Custodial Agent, as the case may be, shall have
been so appointed and shall have accepted such appointment within 30 days after
the retiring Collateral Agent's or Custodial Agent's giving of notice of
resignation or such removal, then the retiring Collateral Agent or Custodial
Agent, as the case may be, may petition any court of competent jurisdiction for
the appointment of a successor Collateral Agent or Custodial Agent, as the case
may be. Each of the Collateral Agent and the Custodial Agent shall be a bank
which has an office in New York, New York with a combined capital and surplus of
at least $75,000,000. Upon the acceptance of any appointment as Collateral Agent
or Custodial Agent, as the case may

                                       22
<PAGE>

be, hereunder by a successor Collateral Agent or Custodial Agent, as the case
may be, such successor shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Collateral Agent or
Custodial Agent, as the case may be, and the retiring Collateral Agent or
Custodial Agent, as the case may be, shall take all appropriate action to
transfer any money and property held by it hereunder (including the Collateral)
to such successor. The retiring Collateral Agent or Custodial Agent shall, upon
such succession, be discharged from its duties and obligations as Collateral
Agent or Custodial Agent hereunder. After any retiring Collateral Agent's or
Custodial Agent's resignation hereunder as Collateral Agent or Custodial Agent,
the provisions of this Article VIII shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting as
the Collateral Agent or Custodial Agent. Any resignation or removal of the
Collateral Agent hereunder shall be deemed for all purposes of this Agreement as
the simultaneous resignation or removal of the Custodial Agent and the
Securities Intermediary.

SECTION 8.9   RIGHT TO APPOINT AGENT OR ADVISOR

     The Collateral Agent shall have the right to appoint agents or advisors in
connection with any of its duties hereunder, and the Collateral Agent shall not
be liable for any action taken or omitted by, or in reliance upon the advice of,
such agents or advisors selected in good faith. The appointment of agents
pursuant to this Section 8.9 shall be subject to prior consent of the Company,
which consent shall not be unreasonably withheld.

SECTION 8.10  SURVIVAL

     The provisions of this Article VIII shall survive termination of this
Agreement and the resignation or removal of the Collateral Agent or the
Custodial Agent.

SECTION 8.11  EXCULPATION

     Anything in this Agreement to the contrary notwithstanding, in no event
shall any of the Collateral Agent, the Custodial Agent or the Securities
Intermediary or their officers, employees or agents be liable under this
Agreement to any third party for indirect, special, punitive, or consequential
loss or damage of any kind whatsoever, including lost profits, whether or not
the likelihood of such loss or damage was known to the Collateral Agent, the
Custodial Agent or the Securities Intermediary, or any of them, incurred without
any act or deed that is found to be attributable to negligence or willful
misconduct on the part of the Collateral Agent, the Custodial Agent or the
Securities Intermediary.

                                  ARTICLE IX.

                                    AMENDMENT

SECTION 9.1   AMENDMENT WITHOUT CONSENT OF HOLDERS

     Without the consent of any Holders or the holders of any Separate
Debentures, the Company, the Collateral Agent, the Custodial Agent, the
Securities Intermediary and the Purchase Contract Agent, at any time and from
time to time, may amend this Agreement, in form

                                       23
<PAGE>

satisfactory to the Company, the Collateral Agent, the Custodial Agent, the
Securities Intermediary and the Purchase Contract Agent, for any of the
following purposes:

                    (a)  to evidence the succession of another Person to
                         the Company, and the assumption by any such
                         successor of the covenants of the Company; or

                    (b)  to add to the covenants of the Company for the
                         benefit of the Holders, or to surrender any right
                         or power herein conferred upon the Company so long
                         as such covenants or such surrender do not
                         adversely affect the validity, perfection or
                         priority of the security interests granted or
                         created hereunder; or

                    (c)  to evidence and provide for the acceptance of
                         appointment hereunder by a successor Collateral
                         Agent, Custodial Agent, Securities Intermediary or
                         Purchase Contract Agent; or

                    (d)  to cure any ambiguity, to correct or supplement
                         any provisions herein which may be inconsistent
                         with any other such provisions herein, or to make
                         any other provisions with respect to such matters
                         or questions arising under this Agreement,
                         provided such action shall not adversely affect
                         the interests of the Holders.

SECTION 9.2   AMENDMENT WITH CONSENT OF HOLDERS

     With the consent of the Holders of not less than a majority of the Purchase
Contracts at the time outstanding, by Act of said Holders delivered to the
Company, the Purchase Contract Agent or the Collateral Agent, as the case may
be, the Company, the Purchase Contract Agent, the Collateral Agent, the
Custodial Agent and the Securities Intermediary may amend this Agreement for the
purpose of modifying in any manner the provisions of this Agreement or the
rights of the Holders in respect of the Securities; provided, however, that no
such supplemental agreement shall, without the consent of the Holder of each
Outstanding Security adversely affected thereby,

                    (a)  change the amount or type of Collateral underlying
                         a Security (except for the rights of holders of
                         Type A Securities to substitute the Treasury
                         Securities for the Pledged Debentures or the
                         appropriate Pledged Applicable Ownership Interest
                         in the Treasury Portfolio, as the case may be, or
                         the rights of Holders of Type B Securities to
                         substitute Debentures or the appropriate
                         Applicable

                                       24
<PAGE>

                         Ownership Interest in the Treasury Portfolio, as
                         applicable, for the Pledged Treasury Securities),
                         impair the right of the Holder of any Security to
                         receive distributions on the underlying Collateral
                         or otherwise adversely affect the Holder's rights
                         in or to such Collateral; or

                    (b)  otherwise effect any action that would require the
                         consent of the Holder of each Outstanding Security
                         affected thereby pursuant to the Purchase Contract
                         Agreement if such action were effected by an
                         agreement supplemental thereto; or

                    (c)  reduce the percentage of Purchase Contracts the
                         consent of whose Holders is required for any such
                         amendment.

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

SECTION 9.3   EXECUTION OF AMENDMENTS

     In executing any amendment permitted by this Section, the Collateral Agent,
the Custodial Agent, the Securities Intermediary and the Purchase Contract Agent
shall be entitled to receive and (subject to Section 6.1 hereof, with respect to
the Collateral Agent, and Section 7.1 of the Purchase Contract Agreement, with
respect to the Purchase Contract Agent) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement and that all conditions precedent, if
any, to the execution and delivery of such amendment have been satisfied.

SECTION 9.4   EFFECT OF AMENDMENTS

     Upon the execution of any amendment under this Article IX, this Agreement
shall be modified in accordance therewith, and such amendment shall form a part
of this Agreement for all purposes; and every Holder of Certificates theretofore
or thereafter authenticated, executed on behalf of the Holders and delivered
under the Purchase Contract Agreement shall be bound thereby.

SECTION 9.5   REFERENCE TO AMENDMENTS

     Security Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any amendment pursuant to this Section may, and
shall if required by the Collateral Agent or the Purchase Contract Agent, bear a
notation in form approved by the Purchase Contract Agent and the Collateral
Agent as to any matter provided for in such amendment. If the Company shall so
determine, new Security Certificates so modified as to conform, in the opinion
of the Collateral Agent, the Purchase Contract Agent and the Company, to any
such amendment may be prepared and executed by the Company and authenticated,

                                       25
<PAGE>

executed on behalf of the Holders and delivered by the Purchase Contract Agent
in accordance with the Purchase Contract Agreement in exchange for Outstanding
Security Certificates.

                                   ARTICLE X.

                                  MISCELLANEOUS

SECTION 10.1  NO WAIVER

     No failure on the part of the Collateral Agent or any of its agents to
exercise, and no course of dealing with respect to, and no delay in exercising,
any right, power or remedy hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise by the Collateral Agent or any of its
agents of any right, power or remedy hereunder preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. The
remedies herein are cumulative and are not exclusive of any remedies provided by
law.

SECTION 10.2  GOVERNING LAW

     THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES
THEREUNDER, EXCEPT TO THE EXTENT THAT THE LAWS OF ANY OTHER JURISDICTION SHALL
BE MANDATORILY APPLICABLE. Without limiting the foregoing, the above choice of
law is expressly agreed to by the Company, the Securities Intermediary, the
Custodial Agent, the Collateral Agent and the Holders from time to time acting
through the Purchase Contract Agent, as their attorney-in-fact, in connection
with the establishment and maintenance of the Collateral Account. The Company,
the Collateral Agent and the Holders from time to time of the Securities, acting
through the Purchase Contract Agent as their attorney-in-fact, hereby submit to
the nonexclusive jurisdiction of the United States District Court for the
Southern District of New York and of any New York state court sitting in New
York City for the purposes of all legal proceedings arising out of or relating
to this Agreement or the transactions contemplated hereby. The Company, the
Collateral Agent and the Holders from time to time of the Securities, acting
through the Purchase Contract Agent as their attorney-in-fact, irrevocably
waive, to the fullest extent permitted by applicable law, any objection which
they may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient forum.

SECTION 10.3  NOTICES

     All notices, requests, consents and other communications provided for
herein (including, without limitation, any modifications of, or waivers or
consents under, this Agreement) shall be given or made in writing (including,
without limitation, by telecopy) delivered to the intended recipient at the
"Address for Notices" specified below its name on the signature pages hereof (or
in the case of Holders, may be made and deemed given as provided in Sections 1.5
and 1.6 of the Purchase Contract Agreement) or, as to any party, at such other
address as shall be designated by such party in a notice to the other parties.
Except as otherwise provided in this Agreement, all such communications shall be
deemed to have been duly given when transmitted by telecopier or

                                       26
<PAGE>

personally delivered or, in the case of a mailed notice, upon receipt, in each
case given or addressed as aforesaid (except as aforesaid).

SECTION 10.4  SUCCESSORS AND ASSIGNS

     This Agreement shall be binding upon and inure to the benefit of the
respective successors and assigns of the Company, the Collateral Agent, the
Custodial Agent, the Securities Intermediary and the Purchase Contract Agent,
and the Holders from time to time of the Securities, by their acceptance of the
same, shall be deemed to have agreed to be bound by the provisions hereof and to
have ratified the agreements of, and the grant of the Pledge hereunder by, the
Purchase Contract Agent.

SECTION 10.5  COUNTERPARTS

     This Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one and the same instrument, and any of the
parties hereto may execute this Agreement by signing any such counterpart.

SECTION 10.6  SEVERABILITY

     If any provision hereof is invalid and unenforceable in any jurisdiction,
then, to the fullest extent permitted by law, (i) the other provisions hereof
shall remain in full force and effect in such jurisdiction and shall be
liberally construed in order to carry out the intentions of the parties hereto
as nearly as may be possible and (ii) the invalidity or unenforceability of any
provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction.

SECTION 10.7  EXPENSES, ETC.

     The Company agrees to reimburse the Collateral Agent and the Custodial
Agent for: (a) all reasonable out-of-pocket costs and expenses of the Collateral
Agent and the Custodial Agent (including, without limitation, the reasonable
fees and expenses of the necessary services of a Securities Intermediary and of
counsel to the Collateral Agent and the Custodial Agent), in connection with
(i) the negotiation, preparation, execution and delivery or performance of this
Agreement and (ii) any modification, supplement or waiver of any of the terms of
this Agreement; (b) all reasonable costs and expenses of the Collateral Agent
(including, without limitation, reasonable fees and expenses of counsel) in
connection with (i) any enforcement or proceedings resulting or incurred in
connection with causing any Holder of Securities to satisfy its obligations
under the Purchase Contracts forming a part of the Securities and (ii) the
enforcement of this Section 10.7; and (c) all transfer, stamp, documentary or
other similar taxes, assessments or charges levied by any governmental or
revenue authority in respect of this Agreement or any other document referred to
herein and all costs, expenses, taxes, assessments and other charges incurred in
connection with any filing, registration, recording or perfection of any
security interest contemplated hereby.

                                       27
<PAGE>

SECTION 10.8  SECURITY INTEREST ABSOLUTE

     All rights of the Collateral Agent and security interests hereunder, and
all obligations of the Holders from time to time hereunder, shall be absolute
and unconditional irrespective of:

          (a)  any lack of validity or enforceability of any provision of the
     Purchase Contracts or the Securities or any other agreement or instrument
     relating thereto;

          (b)  any change in the time, manner or place of payment of, or any
     other term of, or any increase in the amount of, all or any of the
     obligations of Holders of Securities under the related Purchase Contracts,
     or any other amendment or waiver of any term of, or any consent to any
     departure from any requirement of, the Purchase Contract Agreement or any
     Purchase Contract or any other agreement or instrument relating thereto; or

          (c)  any other circumstance which might otherwise constitute a defense
     available to, or discharge of, a borrower, a guarantor or a pledgor.

                                       28
<PAGE>

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

                                         FPL GROUP, INC.

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

                                         Address for Notices:

                                         FPL Group, Inc.
                                         700 Universe Boulevard

                                         Juno Beach, Florida 33408
                                         Attention:
                                                     ---------------------------
                                         Telecopy:

                                         --------------------------------------,
                                         as Purchase Contract Agent and as
                                         attorney-in-fact of the Holders from
                                         time to time of the Securities

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

                                         Address for Notices:

                                         --------------------------------------,
                                         as Collateral Agent, Custodial
                                         Agent and as Securities Intermediary

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

                                         Address for Notices:

<PAGE>

                                                                       EXHIBIT A

          INSTRUCTION FROM PURCHASE CONTRACT AGENT TO COLLATERAL AGENT

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

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

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

                Re:  Securities of FPL Group, Inc. (the "Company")

     We hereby notify you in accordance with Section [4.1] [4.2] of the Pledge
Agreement, dated as of __________, ______, (the "Pledge Agreement") among the
Company, yourselves, as Collateral Agent, Custodial Agent and Securities
Intermediary and ourselves, as Purchase Contract Agent and as attorney-in-fact
for the Holders of [Type A Securities] [Type B Securities] from time to time,
that the Holder of Securities listed below (the "Holder") has elected to
substitute [$_____ principal amount of Treasury Securities] [$_______ principal
amount of Debentures or Stated Amount of the appropriate Applicable Ownership
Interest in the Treasury Portfolio] in exchange for an equal Value of [Pledged
Debentures or the appropriate Pledged Applicable Ownership Interest in the
Treasury Portfolio] [Pledged Treasury Securities] held by you in accordance with
the Pledge Agreement and has delivered to us a notice stating that the Holder
has Transferred [Treasury Securities] [Debentures or the appropriate Applicable
Ownership Interest in the Treasury Portfolio] to you, as Collateral Agent. We
hereby instruct you, upon receipt of such [Pledged Treasury Securities] [Pledged
Debentures or the appropriate Pledged Applicable Ownership Interest in the
Treasury Portfolio], to release the [Debentures or the appropriate Applicable
Ownership Interest in the Treasury Portfolio] [Treasury Securities] related to
such [Type A Securities] [Type B Securities] to us in accordance with the
Holder's instructions. Capitalized terms used herein but not defined shall have
the meaning set forth or incorporated by reference in the Pledge Agreement.

Date:
     --------------------------------    ---------------------------------------

                                         By:
                                            ------------------------------------
                                            Name:
                                            Title:
                                            Signature Guarantee:
                                                                ----------------

                                      A-1
<PAGE>

Please print name and address of registered Holder electing to substitute
[Treasury Securities] [Debentures or the appropriate Applicable Ownership
Interest in the Treasury Portfolio] for [Pledged Debentures or appropriate
Pledged Applicable Ownership Interest in the Treasury Portfolio] [Pledged
Treasury Securities]:

------------------------------              ---------------------------------
             Name                           Social Security or other Taxpayer
                                            Identification Number, if any

            Address

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

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

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

                                      A-2
<PAGE>

                                                                       EXHIBIT B

                     INSTRUCTION TO PURCHASE CONTRACT AGENT

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

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

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

                Re: Securities of FPL Group, Inc. (the "Company")

     The undersigned Holder hereby notifies you that it has delivered to
_________________________, as Collateral Agent, [$_______ principal amount at
maturity of Treasury Securities] [$_______ principal amount of Debentures or
Stated Amount of the appropriate Applicable Ownership Interest in the Treasury
Portfolio] in exchange for an equal Value of [Pledged Debentures or the
appropriate Pledged Applicable Ownership Interest in the Treasury Portfolio]
[Pledged Treasury Securities] held by the Collateral Agent, in accordance with
Section [4.1][4.2] of the Pledge Agreement, dated ________, _____ (the "Pledge
Agreement"), among you, the Company and the Collateral Agent. The undersigned
Holder hereby instructs you to instruct the Collateral Agent to release to you
on behalf of the undersigned Holder the [Pledged Debentures or the appropriate
Pledged Applicable Ownership Interest in the Treasury Portfolio] [Pledged
Treasury Securities] related to such [Type A Securities] [Type B Securities].
Capitalized terms used herein but not defined shall have the meaning set forth
or incorporated by reference in the Pledge Agreement.

Dated:________________________              ____________________________________
                                            Signature

                                            Signature Guarantee:________________

                                      B-1
<PAGE>

Please print name and address of Registered Holder:

-------------------------------             ---------------------------------
             Name                           Social Security or other Taxpayer
                                            Identification Number, if any

Address

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

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

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

                                      B-2
<PAGE>

                                                                       EXHIBIT C

              INSTRUCTION TO CUSTODIAL AGENT REGARDING REMARKETING

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

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

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

             Re:  Securities of FPL Group Capital Inc (the "Company")

     The undersigned hereby notifies you in accordance with Section 4.6(c) of
the Pledge Agreement, dated as of ________, _____ (the "Pledge Agreement"),
among the Company, yourselves, as Collateral Agent, Securities Intermediary and
Custodial Agent, and ______________, as Purchase Contract Agent and as
attorney-in-fact for the Holders of Type A Securities and Type B Securities from
time to time, that the undersigned elects to deliver $________ principal amount
of Debentures for delivery to the Remarketing Agent on the fourth Business Day
immediately preceding the Purchase Contract Settlement Date for remarketing
pursuant to Section 4.6(c) of the Pledge Agreement. The undersigned will, upon
request of the Remarketing Agent, execute and deliver any additional documents
deemed by the Remarketing Agent or by the Company to be necessary or desirable
to complete the sale, assignment and transfer of the Debentures tendered hereby.

     The undersigned hereby instructs you, upon receipt of the Proceeds of such
remarketing from the Remarketing Agent to deliver such Proceeds to the
undersigned in accordance with the instructions indicated herein under
"A. Payment Instructions". The undersigned hereby instructs you, in the event of
Failed Remarketing, upon receipt of the Debentures tendered herewith from the
Remarketing Agent, to deliver such Debentures to the person(s) and the
address(es) indicated herein under "B. Delivery Instructions."

     With this notice, the undersigned hereby (i) represents and warrants that
the undersigned has full power and authority to tender, sell, assign and
transfer the Debentures tendered hereby and that the undersigned is the record
owner of any Debentures tendered herewith in physical form or a participant in
The Depositary Trust Company ("DTC") and the beneficial owner of any Debentures
tendered herewith by book-entry transfer to your account at DTC and (ii) agrees
to be bound by the terms and conditions of Section 4.6(c) of the Pledge
Agreement. Capitalized terms used herein but not defined shall have the meaning
set forth or incorporated by reference in the Pledge Agreement.

Date:
     ---------------------------         ---------------------------------------

                                         By:
                                            ------------------------------------
                                            Name:
                                            Title:
                                            Signature Guarantee:
                                                                ----------------

                                      C-1
<PAGE>

Please print name and address:

----------------------------------          ---------------------------------
              Name                          Social Security or other Taxpayer
                                            Identification Number, if any

            Address

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

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

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

                                      C-2
<PAGE>

A.  PAYMENT INSTRUCTIONS                 B. DELIVERY INSTRUCTIONS

Proceeds of the remarketing should be    In the event of a Failed Remarketing,
paid by check in the name of the         Debentures which are in physical form
person(s) set forth below and mailed     should be delivered tothe person(s) set
to the address set forth below.          forth below and mailed to the address
                                         set forth below.
Name(s)

------------------------------------     Name(s)
           (Please Print)
                                         ---------------------------------------
                                                   (Please Print)
Address

------------------------------------      Address

                                         ---------------------------------------
------------------------------------
              (Please Print)             ---------------------------------------
                                                       (Please Print)
------------------------------------
              (Zip Code)                 ---------------------------------------
                                                       (Zip Code)
------------------------------------
    (Tax Identification or Social        ---------------------------------------
          Security Number)                (Tax Identification or Social
                                                Security Number)

                                         In the event of a Failed Remarketing,
                                         Debentures which are in book-entry form
                                         should be credited to the account at
                                         The Depositary Trust Company set forth
                                         below.

                                                  ------------------------------
                                                    DTC Account Number

                                         Name of Account
                                           Party:
                                                 -------------------------------

                                      C-3
<PAGE>

                                                                       EXHIBIT D

                    INSTRUCTION TO CUSTODIAL AGENT REGARDING
                           WITHDRAWAL FROM REMARKETING

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

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

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

             Re: Securities of FPL Group Capital Inc (the "Company")

     The undersigned hereby notifies you in accordance with Section 4.6(c) of
the Pledge Agreement, dated as of _________, _____ (the "Pledge Agreement")
among the Company, yourselves, as Collateral Agent, Securities Intermediary and
Custodial Agent and __________, as Purchase Contract Agent and as
attorney-in-fact for the Holders of Type A Securities and Type B Securities from
time to time, that the undersigned elects to withdraw the $_____ principal
amount of Debentures delivered to the Custodial Agent on ____________ for
remarketing pursuant to Section 4.6(c) of the Pledge Agreement. The undersigned
hereby instructs you to return such Debentures to the undersigned in accordance
with the undersigned's instructions. With this notice, the Undersigned hereby
agrees to be bound by the terms and conditions of Section 4.6(c) of the Pledge
Agreement. Capitalized terms used herein but not defined shall have the meaning
set forth or incorporated in the Pledge Agreement.

Date:
     ---------------------------         ---------------------------------------

                                         By:
                                            ------------------------------------
                                            Name:
                                            Title:
                                            Signature Guarantee:
                                                                ----------------

                                      D-1
<PAGE>

Please print name and address:

------------------------------------        ------------------------------------
               Name                         Social Security or other Taxpayer
                                            Identification Number, if any

Address

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

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

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

                                      D-2

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