Document:

Exhibit 10.19

             Panther(TM) Drive System Product and Services Agreement

Introduction and Purpose.  This Product and Services Agreement  ("Agreement") is
entered  into as of  _________  (the  "Effective  Date")  by and  between  Enova
Systems,  Inc., a California  corporation  ("Enova") with its principal place of
business  located at 19850 S. Magellan Drive,  Torrance,  California  90502, and
("Customer"),  an  _________Company  ("Purchaser")  with its principal  place of
business located at ________________________.

Enova  manufactures  and sells certain  proprietary  vehicle drive  systems,  as
further described in Appendix 1 (the "Panther(TM) Drive Systems").

Purchaser  manufactures  and sells  certain  vehicles  listed in  Appendix 2 and
wishes to incorporate the Panther(TM)  Drive Systems as an integral drive system
in those vehicles.

Purchaser  wishes to obtain Enova's  assistance in the initial  incorporation of
the Enova Drive  Systems into its  vehicles  and Enova  wishes to provide  joint
development assistance to Purchaser.

Purchaser and Enova wish to address marketing  opportunities and provide for the
purchase of Panther(TM) Drive Systems for incorporation Purchaser's vehicles and
sale in the  event  that the  joint  development  efforts  are  successful.  The
Purchaser  products listed in Appendix 2 developed and  manufactured  under this
Agreement incorporating  Panther(TM) Drive Systems are referred to herein as the
"Products."

     1.4 Agreement.  This Agreement  consists of the body of the Agreement,  the
Appendices,  and  any  purchase  order  issued  and  accepted  pursuant  to  the
provisions  of  this  Agreement.  Section  2  shall  only  apply  if  there  are
Development  Efforts (defined below in Section 2) and Sections 3 through 7 shall
only apply if there is Commercial  Production  (defined below in Section 3). The
terms,  conditions  and  provisions  of this  Agreement  shall be construed in a
manner that gives effect to the entire agreement to the extent  practicable.  To
the extent that any provisions  conflict,  the Agreement and Appendices  control
over any  inconsistent  purchase order terms,  Appendix 9 (Additional  Terms for
Development   Efforts)   controls  over  any  inconsistent   terms  relating  to
Development Efforts and Appendix 10 (Additional Terms for Commercial  Production
and  Additional  General  Terms)  controls  over  any  inconsistent  term in the
Agreement other than those relating to the Development Efforts.

Joint Technical Development and Grant of Rights

Intention.  Purchaser  intends to  integrate a  Panther(TM)  Drive System into a
prototype vehicle (the  "Prototype"),  and as part of such efforts will endeavor
to combine Panther(TM) Drive System with products from manufacturers, suppliers,
and  developers  other than  Enova.  All  efforts by  Purchaser  to combine  the
Panther(TM) Drive System with other

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products or otherwise integrate  Panther(TM) Drive System into the Prototype are
referred to herein as "Development  Efforts." Without limiting the generality of
the  foregoing,  Development  Efforts shall include those  development  projects
undertaken by Enova in direct response to a Development Effort.

Development  Effort Scope.  The parties shall  perform the  Development  Efforts
described  on  Appendix  3. Each  party  shall pay for  expenses  and make other
payments  associated with the Development  Efforts as provided in Appendix 3 and
Appendix 9. Any legal terms that are applicable only to the Development  Efforts
are specified in Appendix 9.

Out-of-Scope  Efforts.  The parties  shall  endeavor in good faith to  establish
their respective rights and duties in any Development  Effort that is not within
the Development  Effort scope defined in Appendix 3. These rights and duties may
include, but are not limited to, assignment of intellectual property and payment
for  additional  hardware  or  services  delivered.  Unless  the  parties  agree
otherwise in writing,  an  out-of-scope  Development  Effort that results in new
technology or  improvement to existing  technology  will be owned as provided in
Attachment 9.

Prototype Hardware  Restrictions.  The Prototype shall be considered a prototype
product  until such time as both parties  mutually  agree  otherwise in writing.
Enova and  Purchaser  agree that neither party shall  publicly  display at trade
shows or otherwise  promote,  market,  or sell any prototype  Purchaser  Product
without the other party's prior written approval.

Commercial  Production.  Promptly  following the date (the Acceptance  Date") on
which Enova and  Purchaser  mutually  agree that  successful  completion  of the
development  and testing of Purchaser  Product has occurred as  contemplated  by
Appendix 3, then  Purchaser  shall  engage in  commercial  production,  sale and
support of Products ("Commercial Production").

Purchase and Sale of Products. If Commercial Production commences,  Enova agrees
to sell and Purchaser agrees to purchase  Panther(TM)  Drive Systems pursuant to
the terms, conditions and provisions of this Agreement.

Purpose.  Purchaser may purchase the Panther(TM) Drive Systems and related spare
and  replacement  parts  for the sole  purpose  of  incorporating  them into the
Purchaser  products  listed in Appendix 2 to create  Products and as replacement
parts for the  Products.  Purchaser  may use the  resulting  Products or sell or
lease them,  either  directly to purchasers  or  indirectly  through one or more
levels of distribution.

Nonexclusivity.   Enova  reserves  the  right  to  select  and  authorize  other
businesses  to sell and service Enova  products and parts,  to sell products and
parts directly to direct  accounts of Enova, to sell products and parts to other
purchasers or original  equipment  manufacturers  for use as an integral part of
assembled equipment, or to any other customers.

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Trained Sales Staff. Purchaser shall maintain a staff of trained sales personnel
in order to ensure maximum market penetration and fulfillment of sales potential
of the Products.

Promotion of Products.  Following the Acceptance Date, Purchaser shall develop a
market and promote  the sale of the  Products  actively,  and  advertise  with a
program  of  advertising  to  create  awareness  of  Enova  products  and  their
associated value proposition. Such promotion and advertising may include, but is
not limited  to,  participation  in trade  shows,  presentations  at seminars or
industry  meetings,  direct mailings to key customer groups and market segments,
direct sales calls,  and other  appropriate  means.  Enova reserves the right to
review and disapprove all advertising  that contains Enova's name or products as
to form and substance.  Purchaser shall deliver to Enova prior to its use a copy
(translated   into   English  if  the   original  is  not  in  English)  of  any
advertisement,  promotion,  trademark listing,  or display with respect to Enova
products, and Enova shall have the right to review and approve or disapprove the
form and substance of each.

Sales  Literature.  Enova shall  provide  Purchaser  with an adequate  supply of
Panther(TM)  Drive  System sales  literature  ("Promotional  Materials")  at the
prevailing  price.  Enova shall have no  obligation  to provide any  Promotional
Materials or other materials or documentation to Purchaser in any language other
than  English.  Enova  grants to  Purchaser  the right to  translate  or to have
translated  into other  languages any materials or  documentation  received from
Enova and  relating to the Enova  products  (including,  but not limited to, the
Promotional  Materials).   Purchaser  may  use,  reproduce,   and/or  sell  such
translations,  but only to the extent  necessary to support and market Products.
Enova shall not be responsible  or liable for the accuracy of such  translations
and  Purchaser  shall  indemnify  Enova and hold it harmless  from all  damages,
expenses and liabilities resulting from any translation inaccuracies.

Press Releases.  The relationship  established by this Agreement is one that the
parties hereto will want to announce,  either jointly or  independently,  in the
form of press  releases,  the  contents,  format,  and  timing of which  will be
subject to the prior written approval of Purchaser and Enova. Such approval will
not  unreasonably  be withheld by either party.  No such prior written  approval
shall be required  for  disclosure  reports and  filings,  which either party is
required to make as a matter of law.

Professional Standards.  Purchaser shall ensure that all of its personnel comply
with  professional  sales standards of conduct typical of a well run business in
order to maintain  and promote  responsible  and ethical  conduct on the part of
such  personnel and thereby  enhance and support the  reputation and goodwill of
Enova products.

Records. Purchaser shall keep records of the incorporation of all Enova products
and parts into Purchaser products.

Inspection. Enova shall have the right during normal business hours, at its cost
with reasonable prior written notice, to inspect all of Purchaser's  facilities,
written  policies and  procedures,  and books and  records,  which relate to the
fulfillment of Purchaser's

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duties  hereunder.  Purchaser  shall  cooperate,  and  cause  its  personnel  to
cooperate, with any such inspection.

Service and Support.

Qualified Service Provider Appointment.  Enova appoints Purchaser as a Qualified
Service Provider ("QSP") with the rights and responsibilities  described in this
Section 4.

Description of QSP Services. Purchaser shall provide services in any location in
which a Product is maintained,  used, leased, or sold by Purchaser.  Services to
be provided by Purchaser shall include, but are not limited to:

providing to end users  operating and maintenance  instructions  and advice with
respect to Panther(TM) Drive Systems. Upon request,  Purchaser shall provide the
location and the use of each unit to Enova. Upon commissioning,  Purchaser shall
explain the  provisions of Enova's  warranty to the end user, and shall instruct
the  end  user  in  the  proper  operation  of  the  Panther(TM)   Drive  System
incorporated into the Product.

providing  services at such times following  installation  of Panther(TM)  Drive
Systems as may be necessary to ensure  proper and efficient  operation  thereof,
including but not limited to commissioning the Panther(TM) Drive System,  making
installation  inspections  and necessary  adjustments,  and performing all other
services reasonably necessary at the time of delivery thereof.

providing warranty services with respect to Panther(TM) Drive Systems consistent
with Enova's Warranty Policy and Procedures.

providing  adequate  service  facilities  and vehicles and providing an adequate
staff of trained  service  personnel in order to provide service for those Enova
products in a professional and timely manner.

Service  Certification.  Purchaser  shall  cause  a  sufficient  number  of  its
qualified  employees  to obtain and maintain  QSP  certification  to provide the
services  described  above.  Purchaser shall send such employees,  at reasonable
intervals,  to Enova's  QSP  certification  seminars  in  Torrance,  California.
Thereafter,  Purchaser  shall send all such employees to periodic  refresher and
new Enova certification seminars so that such employees may maintain their Enova
QSP  Certifications.  Enova shall bear the cost of  preparing  such  courses and
Purchaser  shall bear all travel,  lodging,  and related  costs for sending such
employees  to attend  such  seminars,  including  a fee to Enova for each course
attended.  At Purchaser's  request,  Enova shall, subject to availability and at
such time upon which the Parties mutually agree, send Enova personnel to present
training  seminars  for  Purchaser's  employees at a location to be specified by
Purchaser, provided that Purchaser shall pay all documented travel, lodging, and
related costs, plus a fee to Enova for each course taught.

Service Parts.  Purchaser shall purchase and maintain a sufficient  inventory of
service  parts as  prescribed  by  Enova  according  to  Enova's  uniform  parts
inventory stocking guidelines in effect from time to time and based on the field
population of Products to be

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serviced by Purchaser, so as to be able to fulfill its service  responsibilities
in a timely and professional  manner.  Purchaser may sell or deliver Enova parts
only to end users who purchased Products from Purchaser or to another Enova QSP.
Under no circumstances  shall Purchaser sell,  lease,  distribute,  deliver,  or
transfer Enova parts unless done in connection with a specific Panther(TM) Drive
System warranty repair or replacement.

Parts.  In  providing  services  on Enova  products,  Purchaser  shall  use only
authorized Enova parts, unless Enova agrees otherwise in writing.

Service Part  Discount.  The discount from list price for all service parts will
be 10%.

Service Facilities, Prices. All services billable to end users or submitted as a
warranty  claim to Enova  shall be provided  at the same  rates.  Service  parts
prices  charged  by  Purchaser  shall not  exceed  the Enova  list  price,  plus
applicable freight or taxes in the location of service.

Purchaser's  Basic Warranty  Service  Obligation.  Purchaser's  primary warranty
service  duty as a QSP is to  identify  and replace  malfunctioning  parts under
warranty  promptly and efficiently in accordance with Enova's  technical service
policies and parts stocking guide in effect from time to time.  Purchaser  shall
make reasonable  efforts to determine  whether the end user has a valid warranty
claim. Purchaser shall not recondition or retrofit any product or part and shall
keep in a central  location for Enova's  inspection all defective Enova products
and parts. At Enova's direction and expense,  Purchaser shall return promptly to
Enova all such defective products and parts. Purchaser shall not instruct an end
user to return any Enova product or part directly to Enova.

Compensation for Warranty Repairs. Enova shall compensate Purchaser for services
associated  with warranty  repairs upon receipt and approval of a valid warranty
claim form pursuant to Enova's Warranty Procedure. As part of the warranty claim
procedure,  Purchaser comply with Enova's warranty acceptance  criteria,  as set
forth in  Appendix 4 and submit to Enova the  information  required  by Enova to
demonstrate  compliance with the warranty acceptance criteria.  Enova shall have
no obligation to provide  warranty support under this Agreement or pay Purchaser
for warranty  repairs until Enova is satisfied  that Purchaser has complied with
the applicable warranty acceptance  criteria.  Enova shall pay Purchaser for its
labor on the Enova flat rate  schedule  attached  as  Appendix 5 for removal and
replacement of serviceable  components.  Enova shall reimburse Purchaser for the
price of service parts owned and used by Purchaser to provide  warranty  service
at the rate of 10% below  list  price.  Enova  reserves  the right to verify any
claims that a  Panther(TM)  Drive System  requires  warranty  service  under the
product warranty.  If Enova determines that any Panther(TM) Drive System is free
from defects or otherwise  conforms to Enova's  obligations and warranties under
this Agreement,  Purchaser shall pay all reasonable costs of such determination,
including any labor, travel,  transportation and shipping expenses. In the event
that Enova  determines that the service or repair is not covered under the terms
of the warranty,  Enova shall not be required to reimburse  Purchaser for labor,
parts, or other costs incurred in such service or repair.

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System  Upgrades.  Enova may change the design of the  Panther(TM)  Drive System
from time to time and, at its sole discretion, provide upgraded parts, including
without limitation  hardware,  firmware and software,  for the Panther(TM) Drive
Systems  (collectively,  "Upgrades") shipped to Purchaser but which have not yet
been  incorporated  in Products  and shipped to an end user.  In the event Enova
decides to provide such an Upgrade,  Enova will notify Purchaser of the Upgrade,
and Enova and Purchaser  will  mutually  agree upon a time for the Upgrade to be
installed and the party or parties who will do the installation.

Availability  of Parts.  During the term of this  Agreement  and for a period of
five (5) years thereafter, Enova shall maintain the capability to manufacture or
otherwise  provide to Purchaser  spare parts for the  Panther(TM)  Drive Systems
that it purchases hereunder,  except to the extent that Enova is unable to do so
due to unavailability of parts from its suppliers;  provided that in response to
a request by Purchaser to supply such spare parts during this period, Enova may,
at its option,  instead provide to Purchaser all necessary information to enable
Purchaser to acquire each spare part from component suppliers.  At any time that
Enova is still  manufacturing  or otherwise  providing  spare parts to Purchaser
under this Agreement,  Enova may, at its option, make substitutions in the spare
parts it provides so long as the substitute  part has equivalent or better form,
fit and function.

Support  Documentation.  Enova will make  available  for  purchase by  Purchaser
comprehensive  training,  repair, and service manuals for use in maintaining and
servicing the Panther(TM) Drive Systems.

Manufacturer Support.

Scope of  Support.  Enova  will use  reasonable  commercial  efforts to make its
technical  personnel  available as  reasonably  necessary to provide  after-sale
assistance  to Purchaser  technical and service  personnel to resolve  technical
support  issues.  Such support shall consist  principally of making  appropriate
Enova  technical  personnel  available to Purchaser by telephone  during Enova's
normal business hours. To the extent that technical issues cannot be resolved by
telephone,  Enova will provide  on-site support at Purchaser's  facility.  Enova
will  endeavor to respond to  Purchaser  inquiries  within one (1)  business day
after  receipt and will  endeavor to assist  Purchaser  in  resolving  technical
support issues as soon as practicable  through the exercise of diligent efforts.
Enova will provide such  support to Purchaser  personnel  only and shall have no
obligation to provide any support whatsoever directly to any Purchaser customer.

Fees and  Expenses.  Enova will provide up to 8 hours of telephone  consultation
per month at no  additional  cost to  Purchaser.  Hours in excess of that amount
shall be billed at  Enova's  standard  consulting  rate as in effect at the time
services are rendered.  Except for on-site visits,  if any, that Enova personnel
make in connection  with the performance of warranty  services,  Purchaser shall
reimburse  Enova for expenses  that its personnel  incur in  performing  on-site
support and shall, in addition,  pay Enova's

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standard  consulting  rate for such  personnel as in effect at the time services
are rendered.

Order, Delivery and Payment.

Prices. The prices of all Enova goods and services to be delivered hereunder for
Development Efforts shall be as set forth on Appendix 3. The prices of all Enova
goods and services to be delivered hereunder for Commercial  Production purposes
shall be as set forth on Appendix 7. In addition,  and except to the extent that
Purchaser may provide proper exemption  certificates,  Purchaser shall reimburse
Enova in the amount of any federal,  state or local excise, sales, use and other
taxes,  duties,  tariffs or other governmental fees withheld and/or payable with
respect to the  manufacture,  transportation,  use, or sale of each  Panther(TM)
Drive  System or  component  that  Purchaser  purchases,  whether such taxes are
imposed on Purchaser  or required to be collected by Enova,  or imposed on Enova
products, Enova, or Purchaser in connection with the sale of Enova products, and
whether such taxes are on receipts and gross income or are  occupation or excise
taxes; provided, however, that Purchaser shall not be responsible for taxes upon
the  income  that  Enova  receives  for its sale of Enova  products,  parts  and
services to Purchaser hereunder.  Whenever possible,  such tax or taxes shall be
added to the invoice for the applicable  Enova products as a separate  charge or
invoiced separately.

Rolling  Forecast.  With respect to Panther(TM)  Drive Systems and related spare
parts,  Purchaser  shall deliver to Enova,  quarterly on a rolling  basis,  good
faith  projections of Purchaser's  anticipated  quantity  requirements  for such
Enova  products by month for the  following 12 months.  Forecasts  shall reflect
Purchaser's good faith  expectations of end user demand, and Purchaser shall act
in a  commercially  reasonable  manner  to avoid  creating  production  capacity
problems for Enova.

Calculation  of Annual  Volume  Pricing.  In each 12 month period  following the
Effective Date during the term of this  Agreement,  Enova shall sell products to
Purchaser  at prices that reflect the discount  rate  associated  with the total
volume  forecast  for that 12 month  period,  as set forth in Appendix 7. In the
quarter prior to the  anniversary of the Effective Date, the parties will confer
and mutually agree upon production volumes for the following year. At the end of
each 12 month  period in which  Purchaser  does not  release  for  shipment  the
forecasted  amounts,  Enova will invoice  Purchaser the  difference  between the
invoiced  amounts for Enova  products based on the  forecasted  volume  discount
rates and the  payments  that  would have been  charged  for  Panther(TM)  Drive
Systems based on actual sales volume achieved.

Purchase  Orders and Shipment  Terms.  Purchaser  shall order and release  Enova
products  and  services for  delivery by  delivering  to Enova a purchase  order
("Purchase Order").  This Agreement will apply to every Purchase Order for Enova
products  issued to Enova by  Purchaser  unless the parties  expressly  agree in
writing that this Agreement does not apply.  Subject to the following  sentence,
each  Purchase  Order  accepted by Enova,  together with this  Agreement,  shall
constitute the entire agreement  between Purchaser and Enova with respect to the
purchase,  sale and delivery of the Enova  products  described in such  Purchase
Order. Any terms or conditions  stated in any

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Purchase  Order,  acknowledgment  or  invoice  (except  for  details  of  price,
quantity,  delivery  schedule  and  other  details  of  delivery  which  are not
inconsistent  with the terms of this Agreement) shall be of no force and effect,
and no course of  dealing,  usage of trade,  or course of  performance  shall be
relevant to explain or modify any term expressed in the Agreement.

Procedures.  From time to time during the term of this Agreement,  Purchaser may
order  quantities of Enova products from Enova by submitting to Enova,  at least
the number of days in advance  of the  requested  delivery  dates  specified  in
Appendix 7 hereto as the required "Lead Time," a written  Purchase Order stating
the items and quantities of Enova products  which  Purchaser  wishes to purchase
from Enova and the requested  delivery dates for such items. As permitted below,
Purchaser  may also request  adjustments  to the delivery  dates in a previously
accepted Purchase Order by submitting a new Purchase Order (a "Modified Purchase
Order") specifying the requested changes.  Enova shall accept any Purchase Order
issued by Purchaser  within the scope of the most recent  forecast  submitted to
Enova  pursuant to Section 5.2 above and in  conformance  with the terms of this
Agreement,  including  the  provision  of adequate  Lead  Times.  Lead Times are
estimates and are subject to change,  except with respect to any Purchase  Order
previously  accepted by Enova.  Unless  canceled or deferred as permitted  below
(via a Modified  Purchase  Order),  Purchaser shall be obligated to purchase the
quantities  of Enova  products on the schedule  specified in any Purchase  Order
accepted by Enova. Enova shall acknowledge in writing each Purchase Order within
three (3)  business  days of receipt,  and such  Purchase  Order shall be deemed
accepted  by Enova  unless,  within ten (10) days of  receipt  of such  Purchase
Order,  Enova  submits to  Purchaser,  in writing,  an objection to the Purchase
Order  based upon the failure of  Purchaser  to comply  with this  Agreement  in
submitting the Purchase Order (including,  without limitation, the obligation to
submit monthly rolling forecasts in accordance with Section 5.2 above). If Enova
so objects to any Purchase  Order,  such Purchase  Order shall not be binding on
either  party until a compliant  Purchase  Order is  submitted  by  Purchaser to
Enova. A Purchase Order becomes a part of this Agreement in accordance with this
Section 5 only after it is accepted in writing by Enova or is deemed accepted in
accordance with the above provisions.

Reschedule/Cancellation.   Purchaser  and  Enova  acknowledge  that  substantial
lead-times  are involved in the  manufacture  and delivery of the Enova products
and that Enova would likely suffer  significant loss in the event that Purchaser
seeks to  cancel  an  order  for  Enova  products  within  such  lead-times.  In
recognition of these factors, any initial Purchase Order accepted by Enova shall
be subject to the terms regarding  cancellation or deferral of delivery of Enova
products by Purchaser set forth in Appendix 7.

Delivery.  All deliveries of Enova products shall be made FOB Enova's  Torrance,
California facility or such other facility as Enova may designate ("FOB Point").
In the  absence of written  shipping  instructions  from  Purchaser,  Enova will
select the carrier and use best ground  transportation and ensure that the Enova
products are adequately insured. In the event Enova pays any shipping,  freight,
or insurance charges on behalf of Purchaser,  Purchaser shall promptly reimburse
Enova for all such shipping,  freight or

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insurance  charges  incurred  on behalf of  Purchaser.  If shipment of any Enova
products is delayed at Purchaser's request,  Purchaser shall bear all reasonable
and  necessary  transportation  and/or  storage  related  costs of holding  such
Product,  and Enova may invoice  Purchaser  for such Enova  products on the date
when Enova is prepared to make shipment.

Title And Risk Of Loss.  Title and risk of loss or damage to the Enova  products
shall pass to  Purchaser  upon  Enova's  delivery  of the Enova  products to the
carrier at the FOB Point.

Inspection;  Acceptance.  Purchaser  shall  inspect  and may  reject  all  Enova
products  that  are  defective  within  fifteen  (15)  days  after  the  date of
Purchaser's  receipt thereof. If Purchaser fails to effectively reject any Enova
products in a written  document  delivered to Enova  within such 15-day  period,
Purchaser shall be deemed  conclusively to have accepted such Enova products and
any  defects  (other  than  those  described  in  the  following  sentence  must
thereafter  be  remedied  through the  product  warranty  in  Appendix  6). This
provision  shall in no way impair  Purchaser's  rights with respect to latent or
other defects which would not have been readily ascertainable upon inspection of
the Enova products within such 15-day period.

Payment Terms.  Enova will invoice  Purchaser for Enova products  purchased upon
delivery of such  products to the FOB Point,  and  Purchaser  shall pay all such
invoices  by check or wire  transfer  within  thirty (30) days after the invoice
date.  Enova reserves the right to require  reasonable  assurances of payment by
Purchaser (for example, the issuance of a letter of credit from a reputable bank
provided by  Purchaser  to Enova not later than  fifteen  (15) days prior to the
scheduled  delivery date).  Enova may, from time to time,  evaluate  Purchaser's
credit  standing  and, on that basis,  establish a credit  limit to  accommodate
Purchaser's  issuance of Purchase  Orders as herein  provided.  Purchaser  shall
provide any reasonable assistance requested by Enova to make such evaluation.

Late  Payments.  Regardless of what payment  terms apply to any Purchase  Order,
Purchaser  shall pay to Enova a late  charge on any past due amounts at the rate
of one and  one-half  percent  (1.5%) per month or part  thereof or the  maximum
amount permitted by law, whichever is less.  Purchaser hereby agrees to make all
payments when due for the purchase of any and all Products accepted by Purchaser
regardless of any offset or claim which Purchaser might otherwise be entitled to
assert. Such agreement shall be without prejudice to Purchaser's right to pursue
any claim or remedy  except as an offset  against any payment  owed by Purchaser
under this Agreement.

     1.1 Changes.  Enova  expects to be able to provide  Purchaser  with advance
notice regarding  changes in the design of any Enova products.  Enova shall have
the right, however, to change the design of Enova products at the same time that
Enova provides  notice to Purchaser and shall have the right at any time to make
changes in materials and to improve Enova products,  provided that the resulting
modified  product

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meets or exceeds any  applicable  specifications  under this  Agreement for such
product  and the  modifications  do not  materially  affect  the form,  fit,  or
function of such products.

Warranties to End Users.

Enova's End User Product  Warranty.  Purchaser  shall  include  Enova's End User
Product  Warranty in each  agreement for sale or lease of the products and parts
entered into by Purchaser  with end users and Purchaser  shall furnish a copy of
such End User Product  Warranty to the end user upon  delivery of each  product.
Enova's End User Product Warranty in effect on the Effective Date is attached as
Appendix  6. Enova  reserves  the right to modify,  change or revise the product
warranty at any time upon notice to Purchaser, with such modifications,  changes
or revisions  applicable  for any  products or parts that are ordered  after the
revision  date.  If  any  such  modification  substantially  changes  any of the
discussions  or  agreements  Purchaser  may have had  with its then  current  or
prospective  customers,  Enova and  Purchaser  will discuss and determine how to
resolve such modifications.

Any Additional Purchaser Warranties. Enova shall have no obligation with respect
to, and Purchaser  shall be solely  responsible for and shall indemnify and hold
harmless Enova with respect to, any  warranties  beyond Enova's End User License
and Warranty that Purchaser may provide with respect to any product or part.

Trademarks and Branding.

License to Use Enova Trademarks.  Purchaser acknowledges that Enova is the owner
of all right,  title,  and  interest in and to Enova  trademarks.  Enova  hereby
grants to Purchaser a license,  for so long as this Agreement remains in effect,
to use Enova  trademarks,  provided  that  Purchaser  uses the Enova  trademarks
solely in  marketing,  distributing,  and selling  Panther(TM)  Drive Systems as
integrated in Products  under the terms and  conditions of this Agreement and in
accordance  with the  specifications  as to style,  color,  and typeface for the
Enova trademarks.  Upon termination of this Agreement,  Purchaser shall take all
action  necessary to transfer and assign to Enova or Enova's  nominee any right,
title,  or  interest  in or to any  Enova  trademarks  that  Purchaser  may have
acquired  in any manner as a result of the  marketing,  distribution,  sale,  or
resale  of any  Enova  product,  and  Purchaser  shall  cease  using  any  Enova
trademarks.

Branding. Purchaser shall prominently display on the Products, as well as on all
promotional and other  collateral  materials  relating to, and all packaging for
Products, such trademarks,  trade names, service marks,  designations that Enova
may  adopt  to  identify  it or  any  Enova  products,  or  any  patent,  patent
application,  or other  proprietary  markings  in the size and manner that Enova
designates from time to time. Under no circumstances  shall Purchaser remove any
such  proprietary  notice or marking  affixed to any Enova  product,  parts,  or
related materials.

Term and Termination

                                      S-13

<PAGE>

Term:  This Agreement  shall commence on the Effective Date and continue in full
force and  effect  for a period of five (5) years.  Thereafter,  this  Agreement
automatically  shall renew for subsequent terms of one year each,  unless either
party  provides the other party with notice of its  intention  not to renew this
Agreement  no fewer than 90 calendar  days prior to the end of the  then-current
term.

Termination by Either Party: Each party may terminate this Agreement immediately
by delivering to the other party written notice of such termination in the event
of any of the following:

failure of the Prototype or the Panther(TM) Drive System provided as part of the
Development Efforts to pass acceptance test criteria as outlined in Appendix 3;

a material  breach of this Agreement by the other party that  continues  uncured
for  thirty  (30)  calendar  days  following  written  notice  thereof  from the
non-breaching party;

a material breach of  confidentiality  or nondisclosure  agreements by the other
party, including, without limitation, Section 9 below;

the other party's failure to pay when due any indebtedness  owed by Purchaser to
Enova for Enova products or parts;

the execution by the other party of an assignment  for the benefit of creditors,
or the  commencement  by or against the other party of voluntary or  involuntary
proceedings  (which  are not  dismissed  within  60  calendar  days)  under  any
bankruptcy, reorganization, or similar laws of any jurisdiction, or if any order
shall be made or any  resolution  passed  for the  winding  up,  liquidation  or
dissolution  of the other party,  if a receiver be  appointed  for it for all or
substantially  all of its assets,  or if a  substantial  portion of its goods or
properties shall be taken in execution; or

the other party  ceases to do  business or  otherwise  terminates  its  business
operations relevant to this Agreement.

Termination by Enova.  In addition to the grounds for  termination  set forth in
Section 8.2, Enova may terminate this Agreement upon

Any attempted or actual transfer or assignment of this Agreement or any right or
obligation  hereunder  by  Purchaser,  whether by  operation  of law,  change of
control or otherwise, without the prior written approval of Enova; or if

Purchaser merges into any entity, or the Sale of a Controlling Stock Interest in
Purchaser  occurs,  in each case other than in a transaction in which the person
or persons  controlling the surviving,  continuing or acquiring person after the
transaction  is  or  are  substantially  identical  to  the  person  or  persons
controlling  Purchaser  before  the  transaction;  provided  that,  "Sale  of  a
Controlling  Stock  Interest" of Purchaser means the acquisition by any "person"
or "group," as such terms are defined under the Securities Exchange Act of 1934,
of 50% or more of the voting securities of Purchaser.

                                      S-14

<PAGE>

Termination  of Purchase  Orders.  Either party may  terminate a Purchase  Order
under this Agreement under the same  circumstances as would give rise to a right
to terminate this Agreement.

Payment.  Any termination of this Agreement shall not release Purchaser or Enova
from paying any amount that it may then owe to the other party.  In the event of
termination  of this  Agreement,  all of  Purchaser's  debt to Enova  and all of
Enova's  obligations  to  Purchaser  pursuant  to this  Agreement  shall  become
immediately  due and payable on the date of  termination.  Termination  does not
relieve  Purchaser of the  obligation to pay for Enova products or parts ordered
but not shipped prior to termination.

Survival  of  Obligations.  In  addition  to any  provisions  that  survive  the
termination  of this  Agreement by their express terms and any  provisions  that
would be necessary or useful to the parties in enforcing their respective rights
under the Agreement,  the following  provisions shall survive the termination of
this Agreement:  3.8, 3.9, 4.8 (for a period of five years), 5.10, 5.11, 6, 8.5,
8.6, 9, 10-15, and Sections 4.0 and 5.0 in Appendix 3.

Confidential Information and Intellectual Property.

Confidential  Information.  Confidential  information  shall be  governed by the
standard Enova  Nondisclosure  Agreement,  pursuant to Appendix 8, the terms and
provisions of which are  incorporated  herein by this reference and binding upon
the parties hereto.

Intellectual  Property.  The sale of Enova products to Purchaser does not convey
to Purchaser any intellectual property rights in such Enova products,  including
but not limited to any rights under any patent,  trademark,  copyright, or trade
secret. Except as expressly provided in Section 9.3 of this Agreement, Purchaser
may not use or sell any  Enova  product,  alone  or in  combination  with  other
products,  without a separate  license from Enova under all applicable  patents,
copyrights and trademarks.  Purchaser's use and sale of any Enova products shall
be solely in accordance with the terms and conditions of this Agreement. Neither
the sale of any Enova  Product  nor any  provision  of this  Agreement  shall be
construed to grant to Purchaser,  either expressly,  by implication or by way of
estoppel, any license under any patents or other intellectual property rights of
Enova covering or relating to any other product or invention or any  combination
of Enova products with any other product. Purchaser shall use the Enova products
furnished by Enova solely in accordance  with the terms of this  Agreement,  and
Purchaser shall not,  directly or indirectly,  disassemble,  decompile,  reverse
engineer,  or analyze the physical construction of any of the Enova products for
any purpose.

License Grant. Enova hereby grants to Purchaser a nonexclusive, nontransferable,
worldwide,  royalty-free license under Enova's  intellectual  property rights to
use the  Panther(TM)  Drive  Systems and any  hardware,  firmware,  and software
embodied therein,  in combination with Purchaser  products and/or the technology
of a third person for the specific purpose of providing primary propulsion power
in Products as listed in Appendix 2.

Legal Compliance.

                                      S-15

<PAGE>

Compliance with  Applicable Law.  Purchaser shall ensure that all Enova products
and parts,  and  Purchaser's  services with respect to them,  including  without
limitation the sale, leasing, rental,  installation,  commissioning and warranty
service,  comply with all  applicable  laws,  rules,  regulations  and standards
within the sales  territory.  Purchaser  shall obtain and maintain,  at its sole
expense, any and all certifications, licenses, other authorizations, ratings and
approvals  required  or  advisable  under  the laws of the sales  territory  and
elsewhere in connection with Purchaser's integration,  distribution,  sales, and
provision  of  services  for Enova  products  and parts.  Without  limiting  the
generality of the  foregoing,  Purchaser  shall (a) supply and fit all signs and
safety  notices to the Enova units and provide all manuals and  instructions  so
that they comply with all applicable  laws and  regulations,  and (b) obtain all
necessary  governmental  approvals  and licenses.  Enova shall assist  Purchaser
where possible in obtaining such approvals and compliance.

Improper Payments.  Purchaser and Enova represent and warrant that they have not
made,  or promised to make,  any payment to any public  official in violation of
the United  States  Foreign  Corrupt  Practices  Act or other  applicable  laws.
Purchaser and Enova  represent and warrant that they are aware of the applicable
United States regulations  governing bribery,  agency, and government  purchases
and any other  relevant  regulations  and that they shall comply with such rules
and  regulations.  Each party hereto agrees to hold the other  harmless from and
against the consequences of a violation by it of this provision.

Export  Regulations.  Purchaser  represents  and  warrants  that it has and will
comply in all material  respects  with all  provisions  of United  States export
regulations and laws.  Purchaser  acknowledges  that it has read and is familiar
with  these  regulations  and laws and  shall,  for a period of at least two (2)
years after the  expiration  or earlier  termination  of this  Agreement,  fully
comply  with all  provisions  of these  regulations  and  shall  permit  Enova's
representatives  and/or  representatives  of the  United  States  government  to
inspect all such records as may be required.  Purchaser  represents and warrants
that it shall  provide  Enova,  upon  Enova's  request,  with copies of bills of
lading and other  shipping  documentation  in order to  demonstrate  Purchaser's
compliance with the foregoing.  Purchaser  represents and warrants that it shall
obtain written  assurance from end users of the  Panther(TM)  Drive Systems that
they are not intended to be used for any purposes  prohibited  by United  States
export laws and  regulations  and shall provide Enova with such  information and
documentation as Enova  reasonably  requests in order to verify that Purchaser's
export of the Panther(TM)  Drive Systems complies with applicable  United States
export regulations and laws.

DISCLAIMER.  EXCEPT FOR THE LIMITED WARRANTY GIVEN ONLY TO END USERS PURSUANT TO
ENOVA'S END USER LICENSE AND WARRANTY, ENOVA GIVES NO WARRANTIES REGARDING ENOVA
AND THIRD-PARTY PRODUCTS, PARTS, AND SERVICES THAT ENOVA PROVIDES HEREUNDER AND,
TO THE EXTENT  PERMITTED BY LAW,  DISCLAIMS  ALL EXPRESS,  IMPLIED AND STATUTORY
WARRANTIES,   INCLUDING,   BUT  NOT  LIMITED   TO,  ANY   IMPLIED   WARRANTY  OF
MERCHANTABILITY,   FITNESS  FOR  A  PARTICULAR  PURPOSE,

                                      S-16

<PAGE>

AND NONINFRINGEMENT.  SPECIFICALLY,  BUT WITHOUT LIMITING THE APPLICATION OF THE
FOREGOING  DISCLAIMER,  THE PARTIES  RECOGNIZE AND AGREE THAT THE ENOVA PRODUCTS
AND PARTS MAY  ENCOUNTER  OPERATIONAL  DIFFICULTIES.  ENOVA DOES NOT WARRANT (I)
THAT THE ENOVA  PRODUCTS  AND  PARTS  WILL MEET  PURCHASER'S  OR THE END  USERS'
REQUIREMENTS,  (II)  THAT THE  ENOVA  PRODUCTS  AND PARTS  WILL  OPERATE  IN THE
COMBINATIONS  WHICH THE END USER MAY SELECT FOR USE, (III) THAT THE OPERATION OF
THE ENOVA PRODUCTS AND PARTS WILL BE UNINTERRUPTED  OR ERROR-FREE,  OR (IV) THAT
MALFUNCTIONS  IN THE  ENOVA  PRODUCTS  AND PARTS CAN BE  CORRECTED.  EXCEPT  FOR
ACTIONS FOR NONPAYMENT OR BREACH OF CONFIDENTIALITY OR IP RIGHTS, ANY ACTION FOR
AN ALLEGED  BREACH OF ANY  CONTRACT  OF SALE OR OF  WARRANTY  MUST BE  COMMENCED
WITHIN ONE (1) YEAR AFTER THE DATE ON WHICH THE CAUSE OF ACTION ACCRUES.

Intellectual  Property Infringement  Protection.  Enova shall have the liability
expressed in this  paragraph  with  respect to a claim that an Enova  product or
part  infringes any  intellectual  property  right of any third party,  provided
that:  (a) Purchaser or its end user, as  applicable,  notifies Enova in writing
within ten days of the receipt of any such claim;  (b) Enova has sole control of
the defense of such claim and all related settlement negotiations; (c) Purchaser
and its end user make no  admission of any such  alleged  infringement;  and (d)
Purchaser  and its end user,  as  applicable,  provide  Enova  with  assistance,
information  and  authority  necessary  to  perform  Enova's  duties  under this
paragraph. In no event shall Enova be liable for any claim of infringement based
on the use of any Enova product altered in whole or in part by Purchaser  and/or
its end user or used in  connection  with  absolutely  any  equipment,  process,
software or technology other than that necessary for use of the Enova product in
the Product pursuant to specifications  expressly approved by Enova. If an Enova
product or part is held, or believed by Enova, to infringe, Enova shall have the
sole  option in its sole  discretion  and at its sole  expense to (a) modify the
Enova product or part to cause the same to be noninfringing;  (b) obtain for the
authorized  end user a license to continue  using the Enova  product or part; or
(c)  refund  the fees paid for the  Enova  product  or part upon  return of such
product or part to Enova at its expense. Enova shall have the right to refuse to
supply additional Enova products or parts subject to a claim or threatened claim
of infringement.  THE FOREGOING STATES THE SOLE AND EXCLUSIVE  LIABLITY OF ENOVA
FOR INFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS UNDER THIS AGREEMENT, AND IS IN
LIEU OF ALL WARRANTIES,  EXPRESS, IMPLIED OR STATUTORY IN REGARD TO THOSE ITEMS,
INCLUDING WITHOUT LIMITATION THE WARRANTY AGAINST INFRINGEMENT  SPECIFIED IN THE
UNIFORM COMMERCIAL CODE.

Limitation of Liability In General.  Independent  of,  severable from, and to be
enforced  independently of any other  enforceable or unenforceable  provision of
this  Agreement,  ENOVA  SHALL  NOT BE  LIABLE  FOR  INCIDENTAL,  CONSEQUENTIAL,
INDIRECT,  SPECIAL,  PUNITIVE, OR EXEMPLARY DAMAGES OF ANY KIND - INCLUDING LOST
GOODWILL,  LOST PROFITS,  LOST BUSINESS, OR OTHER INDIRECT ECONOMIC DAMAGES, AND
FURTHER INCLUDING INJURY TO PROPERTY,

                                      S-17

<PAGE>

WHETHER SUCH CLAIM IS BASED ON THEORIES OF CONTRACT, NEGLIGENCE, TORT (INCLUDING
STRICT  LIABILITY) OR OTHERWISE - AS A RESULT OF BREACH OF ANY WARRANTY OR OTHER
TERM OF THIS  AGREEMENT,  REGARDLESS  OF WHETHER  ENOVA WAS  ADVISED,  HAD OTHER
REASON TO KNOW, OR IN FACT KNEW OF THE  POSSIBILITY  OF SUCH DAMAGES.  Purchaser
shall   indemnify,   defend,   and  hold  harmless   Enova  and  its  directors,
shareholders,  officers,  agents,  employees,  successors,  and assigns from and
against any and all claims  arising from, in connection  with, or related in any
way,  directly or  indirectly,  to  Purchaser's  or end user's  improper  use or
operation  of the  Panther(TM)  Drive  Systems  or any other  products  provided
hereunder, including without limitation, all damages resulting from any products
liability claim.

Dispute  Resolution:  All  disputes,  controversies,  claims  for  temporary  or
permanent  redress or relief  arising out of or with reference to this Agreement
and  relating  to  the  ownership,  licensing,  use,  sublicensing,   violation,
infringement  or  performance  hereunder with respect to  intellectual  property
rights  shall be  brought  by either  party in a state or  federal  court in Los
Angeles County,  California or other court of competent jurisdiction.  All other
disputes,  controversies,  claims for  temporary or permanent  redress or relief
arising  out of or  with  reference  to  this  Agreement  shall  be  settled  by
arbitration by a panel of three  arbitrators  under the  commercial  arbitration
rules  of the  American  Arbitration  Association,  Endispute  or  the  Judicial
Arbitration and Mediation Service.  The location of the arbitration shall be Los
Angeles,  California.  Such arbitration shall be conducted by three arbitrators,
one chosen by Enova,  one chosen by Purchaser and a third,  neutral  arbitrator,
selected  by the  first  two.  The award of the  arbitrators  shall be final and
binding and the parties consent to the exclusive  jurisdiction of any federal or
state court in Los Angeles  County for purposes of enforcing any decision of the
arbitration  panel. By this Agreement,  the parties do not intend to deprive any
court  of its  jurisdiction  to  issue  a  prearbitral  injunction,  prearbitral
attachment or other order in aid of arbitration  proceedings  and enforcement of
the award, including without limitation, injunctive relief for the protection of
intellectual property rights.

Miscellaneous:

Governing  Law. This  Agreement  will be governed in all respects by the laws of
the State of California as such laws are applied to contracts between California
residents  entered  into  and to be  performed  entirely  within  the  State  of
California.  The parties agree to exclude entirely the application of the United
Nations  Convention on Contracts for the  International  Sale of Goods from this
Agreement and from any agreement or transaction  that may be executed or carried
out pursuant to this Agreement.

Entire and Sole Agreement.  This document,  together with the attached  exhibits
specifically referenced in this document, constitutes the complete and exclusive
statement of the mutual understanding of the parties with respect to its subject
matter.  This  Agreement   supersedes  any  and  all  prior  or  contemporaneous
understandings,  representations,  or other communication between the parties of
any sort, whether written or oral, with respect to its subject matter. The terms
of this Agreement shall supersede any  inconsistent  terms and conditions of any
Purchase  Order,  regardless  of

                                      S-18

<PAGE>

form,  issued by Purchaser  to Enova.  In any  proceeding  brought to enforce or
interpret the terms of this Agreement,  the nonprevailing party shall pay to the
prevailing party the prevailing party's attorneys' fees and costs incurred.

Assignment.  Neither party shall assign this  Agreement or any right or interest
under this  Agreement or delegate  any  obligation  to be  performed  under this
Agreement  without the other party's prior written consent,  which consent shall
not be unreasonably withheld, and any attempt to do so shall be void.

Force  Majeure.  Each  party's  performance  under this  Agreement  (i) shall be
suspended  (other than the  obligation to pay monies already due to either party
or becoming due as a result of filling  orders  placed and accepted) for so long
as such performance is hindered or prevented by events or occurrences beyond its
reasonable control ("Force Majeure"),  such as, but not limited to, riots, labor
disputes of a general  nature,  national or civil wars (declared or undeclared),
insurrections,   rebellions,  terrorist  acts,  embargoes,  civil  disturbances,
dispositions  or orders of  governmental  authority  (whether such  authority be
actual or assumed), acts of civil or military authority,  fires, strikes, delays
in transportation, inability to obtain necessary labor, manufacturing facilities
or materials  from usual  sources and acts of God and (ii) any delays  resulting
from any such cause shall extend the time for performance correspondingly.  If a
failure  to  perform  results  from  a  governmental   law,  rule,   regulation,
disposition or order and the affected  party is unable to perform,  after making
reasonable  efforts to comply with such law,  rule,  regulation,  disposition or
order,  the matter  shall be deemed a Force  Majeure.  IN NO EVENT SHALL  EITHER
PARTY BE LIABLE TO THE OTHER FOR  GENERAL,  CONSEQUENTIAL,  INDIRECT  OR SPECIAL
DAMAGES DUE TO ANY FORCE MAJEURE.

Counterparts.  This  Agreement  may be  executed  and  delivered  in one or more
counterparts  and by  facsimile  transmission,  each of which shall be deemed an
original,  but  all  of  which  together  shall  constitute  one  and  the  same
instrument.

Severability. In the event any provision of this Agreement is held to be invalid
or  unenforceable,  the  remaining  provisions  shall  remain in full  force and
effect.

Relationship  of the  Parties.  Purchaser  shall  conduct  its  business  in the
purchase,  distribution,   marketing,  sale,  installation,   commissioning  and
provision of services with respect to Enova  products  hereunder as a principal,
for its own account and at its own expense and risk.  Nothing  contained in this
Agreement shall be construed as creating a joint venture,  partnership,  agency,
or  employment  relationship  between the parties  hereto nor shall either party
have the right, power, or authority to create any obligation or duty, express or
implied,  on behalf of the other  party.  Purchaser  shall not act or  represent
itself,  either directly or by  implication,  as an agent for Enova and will not
attempt to create  any  obligation,  or make any  representation,  warranty,  or
covenant that Enova has not specifically  authorized in working on behalf, or in
the name, of Enova.

No Third Party Beneficiaries. Unless otherwise expressly provided, no provisions
of this  Agreement  are intended or shall be construed to confer upon or give to
any person or

                                      S-19

<PAGE>

entity other than Enova or  Purchaser,  any rights,  remedies or other  benefits
under or by reason of this Agreement.

Notices. All notices or other communications that shall or may be given pursuant
to this Agreement, shall be in writing, shall be sent by certified or registered
air mail with postage prepaid, return receipt requested,  by facsimile,  e-mail,
reputable  overnight or other rapid  courier with tracking  capabilities,  or by
hand delivery;  provided,  however,  that if a notice or other  communication is
sent via facsimile or e-mail,  such notice or  communication  shall also sent by
one of the other  means of  transmittal  (with the  exception  of  facsimile  or
e-mail,  as the case may be).  Such  communications  shall be  deemed  given and
received upon delivery if sent by overnight  courier or hand  delivered,  within
three  business days of mailing,  if sent by certified or registered  mail,  and
within the time period set forth above for such method  other than  facsimile or
e-mail if sent by facsimile or e-mail,  and shall be addressed to the Parties as
set forth in the  preamble  to this  Agreement  or such other  addresses  as the
Parties  may  designate  and provide  notice of in writing  from time to time in
accordance with this Section.

Waiver.  No  waiver  of any  provision  of this  Agreement  or of any  rights or
obligations of either party hereunder  shall be effective  unless in writing and
signed by the party waiving  compliance,  and any such waiver shall be effective
only in the  specific  instance  and for the  specific  purpose  stated  in such
writing.

Amendments. This Agreement shall not be modified, amended, or in any way altered
except by an instrument in writing signed by the parties hereto.

                                      S-20

<PAGE>

IN WITNESS  WHEREOF,  the parties  have  entered  into this  Agreement as of the
Effective Date.

ENOVA SYSTEMS, INC.                            PURCHASER

By:  ______________________________            By:  ____________________________

                                               Name:
Name: Carl Dean Perry
                                               Title:  President
Title:  President & CEO

                                      S-21FACE OF SECURITY
                             Fixed Rate Senior Note

REGISTERED                                                     REGISTERED
No. FXR - 18                                                   $5,000,000
                                                               CUSIP: 00079FAU6

     Unless this certificate is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York, New York) to the
issuer or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or such other name
as requested by an authorized representative of The Depository Trust Company
and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered
owner hereof, Cede & Co., has an interest herein.

<PAGE>

                               ABN AMRO BANK N.V.

                    SENIOR GLOBAL MEDIUM-TERM NOTE, SERIES A

                                  (Fixed Rate)

            11.50% Reverse Exchangeable Securities due May 22, 2003
             linked to common stock of Verizon Communications Inc.

<TABLE>
<S>                          <C>                        <C>                        <C>
================================================================================================================
ORIGINAL ISSUE DATE:         INITIAL REDEMPTION         INTEREST RATE:             MATURITY DATE:
  May 22, 2002                 DATE: N/A                  11.50% per annum           May 22, 2003
----------------------------------------------------------------------------------------------------------------
INTEREST ACCRUAL             INITIAL REDEMPTION         INTEREST PAYMENT           OPTIONAL REPAYMENT
  DATE: May 22, 2002           PERCENTAGE: N/A            DATES: November 22,         DATE: N/A
                                                          2002 and May 22, 2003
----------------------------------------------------------------------------------------------------------------
SPECIFIED CURRENCY:          ANNUAL REDEMPTION          INTEREST PAYMENT PERIOD:   APPLICABILITY OF
U.S. Dollars                   PERCENTAGE                 Semi-annually              MODIFIED
                               REDUCTION: N/A                                        PAYMENT UPON
                                                                                     ACCELERATION:
                                                                                     N/A (But see "Alternate
                                                                                     Exchange Calculation in
                                                                                     case of an Event of
                                                                                     Default")
----------------------------------------------------------------------------------------------------------------
IF SPECIFIED CURRENCY        REDEMPTION NOTICE          APPLICABILITY OF           If yes, state Issue
  OTHER THAN U.S.              PERIOD: N/A                ANNUAL INTEREST            Price: N/A
  DOLLARS, OPTION TO                                      PAYMENTS: N/A
  ELECT PAYMENT IN
  U.S. DOLLARS: N/A
----------------------------------------------------------------------------------------------------------------
EXCHANGE RATE AGENT:                                                               ORIGINAL YIELD TO
  N/A                                                                              MATURITY: N/A
----------------------------------------------------------------------------------------------------------------
OTHER PROVISIONS:
  (see below)
----------------------------------------------------------------------------------------------------------------

================================================================================================================
</TABLE>

                                       2
<PAGE>

Initial Price.........................  $43.14 per Underlying Share divided by
                                        the Exchange Factor.

Underlying Shares ....................  Common stock of the Underlying Company,
                                        par value $0.10 per share.

Underlying Company ...................  Verizon Communications Inc.

Minimum Denominations.................  $1,000 and integral multiples thereof.

Payment at Maturity:..................  At maturity, the Issuer shall pay or
                                        deliver for each $1,000 principal
                                        amount of Notes, either (i) a cash
                                        payment equal to $1,000, if the
                                        Determination Price on the
                                        Determination Date of the Underlying
                                        Shares is at or above the Initial
                                        Price, or (ii) the number of Underlying
                                        Shares equal to the Stock Redemption
                                        Amount, if the Determination Price on
                                        the Determination Date of the
                                        Underlying Shares is lower than the
                                        Initial Price. The Issuer shall pay
                                        cash in lieu of delivering fractional
                                        Underlying Shares in an amount equal to
                                        the corresponding fractional Closing
                                        Price of the Underlying Shares as
                                        determined by the Calculation Agent on
                                        the Determination Date. If the Issuer
                                        is required to deliver Underlying
                                        Shares pursuant to the terms of the
                                        Notes, it shall, or cause the
                                        Calculation Agent to, provide written
                                        notice to the Trustee at its New York
                                        office, on which notice the Trustee may
                                        conclusively rely, of the Stock
                                        Redemption Amount, on or prior to the
                                        Issuer Notice Date. The Issuer shall,
                                        or shall cause the Calculation Agent
                                        to, deliver such Underlying Shares
                                        (and/or Exchange Property, if
                                        applicable) to the Trustee for delivery
                                        to the Holders.

Stock Redemption Amount:..............  The Calculation Agent shall determine
                                        the Stock Redemption Amount for each
                                        $1,000 principal amount of Notes on the
                                        Determination Date by dividing $1,000
                                        by the Initial Price.

                                        The number of Underlying Shares to be
                                        delivered at maturity shall be subject
                                        to any applicable adjustments (i) to
                                        the Exchange Factor and (ii) in the
                                        Exchange Property, as

                                       3
<PAGE>

                                        defined in paragraph 5 under
                                        "Adjustment Events" below, to be
                                        delivered instead of, or in addition
                                        to, such Underlying Shares in each case
                                        as a result of any corporate event
                                        described under "Adjustment Events"
                                        below.

Determination Date:...................  The third Business Day prior to the
                                        Maturity Date, or if such day is not a
                                        Trading Day, the immediately succeeding
                                        Trading Day; provided that the
                                        Determination Date shall be no later
                                        than the second scheduled Trading Day
                                        preceding the Maturity Date,
                                        notwithstanding the occurrence of a
                                        Market Disruption Event on such second
                                        scheduled Trading Day.

Determination Price:..................  The Closing Price per Underlying Share
                                        on the Determination Date, as
                                        determined by the Calculation Agent.

Closing Price.........................  If the Underlying Shares (or any other
                                        security for which a Closing Price must
                                        be determined) are listed on a U.S.
                                        securities exchange registered under
                                        the Exchange Act is a security of The
                                        Nasdaq National Market or is included
                                        in the OTC Bulletin Board Service (the
                                        "OTC Bulletin Board"), operated by the
                                        National Association of Securities
                                        Dealers, Inc., the Closing Price for
                                        one Underlying Share (or one unit of
                                        any such other security) on any Trading
                                        Day means (i) the last reported sale
                                        price, regular way, in the principal
                                        trading session on such day on the
                                        principal securities exchange on which
                                        the Underlying Shares (or any such
                                        other security) are listed or admitted
                                        to trading or (ii) if not listed or
                                        admitted to trading on any such
                                        securities exchange or if such last
                                        reported sale price is not obtainable
                                        (even if the Underlying Shares (or
                                        other such security) are listed or
                                        admitted to trading on such securities
                                        exchange), the last reported sale price
                                        in the principal trading session on the
                                        over-the-counter market as reported on
                                        The Nasdaq National Market or OTC
                                        Bulletin Board on such day. If the last
                                        reported sale price is not available
                                        pursuant to clause (i) or (ii) of the
                                        preceding

                                       4
<PAGE>

                                        sentence, the Closing Price for any
                                        Trading Day shall be the mean, as
                                        determined by the Calculation Agent, of
                                        the bid prices for the Underlying
                                        Shares (or any such other security)
                                        obtained from as many dealers in such
                                        security (which may include AAI or any
                                        of the Issuer's other subsidiaries or
                                        affiliates), but not exceeding three,
                                        as will make such bid prices available
                                        to the Calculation Agent. A "security
                                        of The Nasdaq National Market" shall
                                        include a security included in any
                                        successor to such system and the term
                                        "OTC Bulletin Board Service" shall
                                        include any successor service thereto.

Issuer Notice Date....................  The Business Day immediately succeeding
                                        the Determination Date; provided that
                                        the Issuer Notice Date shall be no
                                        later than the second scheduled Trading
                                        Day preceding the Maturity Date,
                                        notwithstanding the occurrence of a
                                        Market Disruption Event on such
                                        scheduled Trading Day.

Trading Day:..........................  A day, as determined by the Calculation
                                        Agent, on which trading is generally
                                        conducted on the New York Stock
                                        Exchange, the American Stock Exchange
                                        Inc., the Nasdaq National Market, the
                                        Chicago Mercantile Exchange, and the
                                        Chicago Board of Options Exchange and
                                        in the over-the-counter market for
                                        equity securities in the United States
                                        and on which a Market Disruption Event
                                        has not occurred.

Market Disruption Event:..............  Means, with respect to the Underlying
                                        Shares:

                                              (i) a suspension, absence or
                                            material limitation of trading of
                                            the Underlying Shares on the
                                            primary market for the Underlying
                                            Shares for more than two hours of
                                            trading or during the one-half hour
                                            period preceding the close of
                                            trading in such market; or a
                                            breakdown or failure in the price
                                            and trade reporting systems of the
                                            primary market for the Underlying
                                            Shares that is, in the sole
                                            discretion of the Calculation
                                            Agent, material;

                                       5
<PAGE>

                                            or the suspension, absence or
                                            material limitation on the primary
                                            market for trading in futures or
                                            options contracts related to the
                                            Underlying Shares, if available,
                                            during the one-half hour period
                                            preceding the close of trading in
                                            the applicable market, in each case
                                            as determined by the Calculation
                                            Agent in its sole discretion; and

                                              (ii) a determination by the
                                            Calculation Agent in its sole
                                            discretion that the event described
                                            in clause (i) above materially
                                            interfered with the Issuer's
                                            ability or the ability of any of
                                            the Issuer's affiliates to unwind
                                            or adjust all or a material portion
                                            of the hedge with respect to the
                                            Notes.

                                        For purposes of determining whether a
                                        Market Disruption Event has occurred:
                                        (1) a limitation on the hours or number
                                        of days of trading will not constitute
                                        a Market Disruption Event if it results
                                        from an announced change in the regular
                                        business hours of the relevant
                                        exchange; (2) a decision to permanently
                                        discontinue trading in the relevant
                                        futures or options contract will not
                                        constitute a Market Disruption Event;
                                        (3) limitations pursuant to New York
                                        Stock Exchange Inc. Rule 80A (or any
                                        applicable rule or regulation enacted
                                        or promulgated by the New York Stock
                                        Exchange Inc., any other
                                        self-regulatory organization or the
                                        Commission of similar scope as
                                        determined by the Calculation Agent) on
                                        trading during significant market
                                        fluctuations shall constitute a
                                        suspension, absence or material
                                        limitation of trading; (4) a suspension
                                        of trading in futures or options
                                        contracts on the Underlying Shares by
                                        the primary securities market trading
                                        in such futures or options, if
                                        available, by reason of (x) a price
                                        change exceeding limits set by such
                                        securities exchange or market, (y) an
                                        imbalance of orders relating to such
                                        contracts or (z) a disparity in bid and
                                        ask quotes relating to such contracts
                                        will constitute a suspension, absence
                                        or material

                                       6
<PAGE>

                                        limitation of trading in futures or
                                        options contracts related to the
                                        Underlying Shares; and (5) a
                                        suspension, absence or material
                                        limitation of trading on the primary
                                        securities market on which futures or
                                        options contracts related to the
                                        Underlying Shares are traded will not
                                        include any time when such securities
                                        market is itself closed for trading
                                        under ordinary circumstances.

                                        The Calculation Agent shall as soon as
                                        reasonably practicable under the
                                        circumstances notify the Issuer, the
                                        Trustee, the Depository Trust Company
                                        and the Agents of the existence or
                                        occurrence of a Market Disruption Event
                                        on any day that but for the occurrence
                                        or existence of a Market Disruption
                                        Event would have been the Determination
                                        Date.

Exchange Factor.......................  The Exchange Factor shall initially be
                                        1.0, but shall be subject to adjustment
                                        by the Calculation Agent upon the
                                        occurrence of certain corporate events
                                        affecting the Underlying Shares though
                                        and including the Determination Date.
                                        See "Adjustment Events" below.

Adjustment Events:....................  The Exchange Factor or the amount paid
                                        at maturity (in the case of paragraph 5
                                        below) shall be adjusted as follows:

                                        1. If the Underlying Shares are subject
                                        to a stock split or reverse stock
                                        split, then once such split has become
                                        effective, the Exchange Factor shall be
                                        adjusted to equal the product of the
                                        prior Exchange Factor and the number of
                                        shares issued in such stock split or
                                        reverse stock split with respect to one
                                        Underlying Share.

                                        2. If the Underlying Shares are subject
                                        (i) to a stock dividend (issuance of
                                        additional Underlying Shares) that is
                                        given ratably to all holders of
                                        Underlying Shares or (ii) to a
                                        distribution of the Underlying Shares
                                        as a result of the triggering of any
                                        provision of the corporate charter of
                                        the Underlying Company, in each case
                                        other than a stock split described in
                                        paragraph 1, then once the dividend has
                                        become

                                       7
<PAGE>

                                        effective and the Underlying Shares are
                                        trading ex-dividend, the Exchange
                                        Factor shall be adjusted so that the
                                        new Exchange Factor shall equal the
                                        prior Exchange Factor plus the product
                                        of (i) the number of shares issued with
                                        respect to one Underlying Share and
                                        (ii) the prior Exchange Factor.

                                        3. There shall be no adjustments to the
                                        Exchange Factor to reflect cash
                                        dividends or other distributions paid
                                        with respect to the Underlying Shares
                                        other than Extraordinary Dividends as
                                        described below (except that
                                        distributions described in paragraph 2
                                        above shall not be subject to this
                                        paragraph). A cash dividend or other
                                        distribution with respect to the
                                        Underlying Shares shall be deemed to be
                                        an "Extraordinary Dividend" if such
                                        dividend or other distribution exceeds
                                        the immediately preceding
                                        non-Extraordinary Dividend for the
                                        Underlying Shares by an amount equal to
                                        at least 10% of the closing price of
                                        the Underlying Shares (as adjusted for
                                        any subsequent corporate event
                                        requiring an adjustment hereunder, such
                                        as a stock split or reverse stock
                                        split) on the Trading Day preceding the
                                        ex-dividend date for the payment of
                                        such Extraordinary Dividend (the
                                        "ex-dividend date"). If an
                                        Extraordinary Dividend occurs with
                                        respect to the Underlying Shares, the
                                        Exchange Factor with respect to the
                                        Underlying Shares will be adjusted on
                                        the ex-dividend date with respect to
                                        such Extraordinary Dividend so that the
                                        new Exchange Factor will equal the
                                        product of (i) the then current
                                        Exchange Factor and (ii) a fraction,
                                        the numerator of which is the Closing
                                        Price on the Trading Day preceding the
                                        ex-dividend date, and the denominator
                                        of which is the amount by which the
                                        Closing Price on the Trading Day
                                        preceding the ex-dividend date exceeds
                                        the Extraordinary Dividend Amount. The
                                        "Extraordinary Dividend Amount" with
                                        respect to an Extraordinary Dividend
                                        for the Underlying Shares shall equal
                                        (i) in the case of cash

                                       8
<PAGE>

                                        dividends or other distributions that
                                        constitute regular dividends, the
                                        amount per share of such Extraordinary
                                        Dividend minus the amount per share of
                                        the immediately preceding
                                        non-Extraordinary Dividend for the
                                        Underlying Shares or (ii) in the case
                                        of cash dividends or other
                                        distributions that do not constitute
                                        regular dividends, the amount per share
                                        of such Extraordinary Dividend. To the
                                        extent an Extraordinary Dividend is not
                                        paid in cash, the value of the non-cash
                                        component will be determined by the
                                        Calculation Agent, whose determination
                                        shall be conclusive. A distribution on
                                        the Underlying Shares described in
                                        clause (i), clause (iv) or clause (v)
                                        of paragraph 5 below that also
                                        constitutes an Extraordinary Dividend
                                        shall not cause an adjustment to the
                                        Exchange Factor pursuant to this
                                        paragraph 3.

                                        4. If the Underlying Company issues
                                        rights or warrants to all holders of
                                        the Underlying Shares to subscribe for
                                        or purchase Underlying Shares at an
                                        exercise price per share less than the
                                        Closing Price of the Underlying Shares
                                        on both (i) the date the exercise price
                                        of such rights or warrants is
                                        determined and (ii) the expiration date
                                        of such rights or warrants, and if the
                                        expiration date of such rights or
                                        warrants precedes the maturity of this
                                        Note, then the Exchange Factor shall be
                                        adjusted to equal the product of the
                                        prior Exchange Factor and a fraction,
                                        the numerator of which shall be the
                                        number of Underlying Shares outstanding
                                        immediately prior to the issuance of
                                        such rights or warrants plus the number
                                        of additional Underlying Shares offered
                                        for subscription or purchase pursuant
                                        to such rights or warrants and the
                                        denominator of which shall be the
                                        number of Underlying Shares outstanding
                                        immediately prior to the issuance of
                                        such rights or warrants plus the number
                                        of additional Underlying Shares which
                                        the aggregate offering price of the
                                        total number of shares of the
                                        Underlying Shares

                                       9
<PAGE>

                                        so offered for subscription or purchase
                                        pursuant to such rights or warrants
                                        would purchase at the Closing Price on
                                        the expiration date of such rights or
                                        warrants, which shall be determined by
                                        multiplying such total number of shares
                                        offered by the exercise price of such
                                        rights or warrants and dividing the
                                        product so obtained by such Closing
                                        Price.

                                        5. If a Reorganization Event (as
                                        defined below) occurs, each holder of
                                        Notes will receive at maturity, in
                                        respect of each $1,000 principal amount
                                        of each Note, the lesser of: (i) $1,000
                                        in cash or (ii) Exchange Property (as
                                        defined below) in an amount with a
                                        value equal to the product of the stock
                                        redemption amount times the Transaction
                                        Value (as defined below). In the case
                                        of a Reorganization Event that is the
                                        result of any issuance of tracking
                                        stock by the Underlying Company or a
                                        Spin-off Event (as defined below), the
                                        Issuer may, at its sole option, in lieu
                                        of clause (ii) above, elect to deliver
                                        Exchange Property consisting solely of
                                        the reclassified Underlying Shares (in
                                        the case of an issuance of tracking
                                        stock) or the Underlying Shares with
                                        respect to which the spun-off security
                                        was issued (in the case of a Spin-off
                                        Event) and pay the cash value of such
                                        tracking stock or spun-off security as
                                        of the determination date. If the
                                        Issuer elects to deliver cash pursuant
                                        to the immediately preceding sentence,
                                        the Issuer will provide notice to
                                        holders of Notes as soon as practicable
                                        after the date of such Reorganization
                                        Event.

                                          "Reorganization Event" means (i)
                                            there has occurred any
                                            reclassification or change with
                                            respect to the Underlying Shares,
                                            including, without limitation, as a
                                            result of the issuance of any
                                            tracking stock by the Underlying
                                            Company; (ii) the Underlying
                                            Company or any surviving entity or
                                            subsequent surviving entity of the
                                            Underlying Company (an "Underlying

                                      10
<PAGE>

                                            Company Successor") has been
                                            subject to a merger, combination or
                                            consolidation and is not the
                                            surviving entity; (iii) any
                                            statutory exchange of securities of
                                            the Underlying Company or any
                                            Underlying Company Successor with
                                            another corporation occurs (other
                                            than pursuant to clause (ii)
                                            above); (iv) the Underlying Company
                                            is liquidated; (v) the Underlying
                                            Company issues to all of its
                                            shareholders equity securities of
                                            an issuer other than the Underlying
                                            Company (other than in a
                                            transaction described in clauses
                                            (ii), (iii) or (iv) above) (a
                                            "Spin-off Event"); or (vi) a tender
                                            or exchange offer or going-private
                                            transaction is consummated for all
                                            the outstanding Underlying Shares.

                                          "Exchange Property" means
                                            securities, cash or any other
                                            assets distributed to holders of
                                            the Underlying Shares in any
                                            Reorganization Event, including, in
                                            the case of the issuance of
                                            tracking stock, the reclassified
                                            Underlying Shares and, in the case
                                            of a Spin-off Event, the Underlying
                                            Shares with respect to which the
                                            spun-off security was issued.

                                          "Transaction Value", at any date,
                                            means (i) for any cash received in
                                            any such Reorganization Event, the
                                            amount of cash received per
                                            Underlying Share; (ii) for any
                                            property other than cash or
                                            securities received in any such
                                            Reorganization Event, the market
                                            value, as determined by the
                                            calculation agent, as of the date
                                            of receipt, of such Exchange
                                            Property received for each
                                            Underlying Share; and (iii) for any
                                            security received in any such
                                            Reorganization Event (including in
                                            the case of the issuance of
                                            tracking stock, the reclassified
                                            Underlying Shares and, in the case
                                            of a Spin-off Event, the Underlying

                                      11
<PAGE>

                                            Shares with respect to which the
                                            spun-off security was issued), an
                                            amount equal to the closing price,
                                            as of the determination date, per
                                            share of such security multiplied
                                            by the quantity of such security
                                            received for each Underlying Share.

                                          If Exchange Property consists of more
                                          than one type of property, holders of
                                          Notes will receive at maturity a pro
                                          rata share of each such type of
                                          Exchange Property in proportion to
                                          the quantity of such Exchange
                                          Property received in respect of each
                                          Underlying Share. If Exchange
                                          Property includes a cash component,
                                          holders will not receive any interest
                                          accrued on such cash component. In
                                          the event Exchange Property consists
                                          of securities, those securities will,
                                          in turn, be subject to the
                                          antidilution adjustments set forth in
                                          paragraphs 1 through 5.

                                          For purposes of this paragraph 5, in
                                          the case of a consummated tender or
                                          exchange offer or going-private
                                          transaction involving Exchange
                                          Property of a particular type,
                                          Exchange Property shall be deemed to
                                          include the amount of cash or other
                                          property paid by the offeror in the
                                          tender or exchange offer with respect
                                          to such Exchange Property (in an
                                          amount determined on the basis of the
                                          rate of exchange in such tender or
                                          exchange offer or going-private
                                          transaction). In the event of a
                                          tender or exchange offer or a
                                          going-private transaction with
                                          respect to Exchange Property in which
                                          an offeree may elect to receive cash
                                          or other property, Exchange Property
                                          shall be deemed to include the kind
                                          and amount of cash and other property
                                          received by offerees who elect to
                                          receive cash.

                                        No adjustments to the Exchange Factor
                                        shall be

                                      12
<PAGE>

                                        required unless such adjustment would
                                        require a change of at least 0.1% in
                                        the Exchange Factor then in effect. The
                                        Exchange Factor resulting from any of
                                        the adjustments specified above shall
                                        be rounded to the nearest one
                                        hundred-thousandth with five
                                        one-millionths being rounded upward.

                                        No adjustments to the Exchange Factor
                                        or method of calculating the Exchange
                                        Factor shall be required other than
                                        those specified above. However, the
                                        Issuer may, at its sole discretion,
                                        cause the Calculation Agent to make
                                        additional changes to the Exchange
                                        Factor upon the occurrence of corporate
                                        or other similar events that affect or
                                        could potentially affect market prices
                                        of, or shareholders' rights in, the
                                        Underlying Shares (or other Exchange
                                        Property) but only to reflect such
                                        changes, and not with the aim of
                                        changing relative investment risk. The
                                        adjustments specified above do not
                                        cover all events that could affect the
                                        market price or the Closing Price of
                                        the Underlying Shares, including,
                                        without limitation, a partial tender or
                                        partial exchange offer for the
                                        Underlying Shares.

                                        The Calculation Agent shall be solely
                                        responsible for the determination and
                                        calculation of any adjustments to the
                                        Exchange Factor or method of
                                        calculating the Exchange Factor and of
                                        any related determinations and
                                        calculations with respect to any
                                        distributions of stock, other
                                        securities or other property or assets
                                        (including cash) in connection with any
                                        Reorganization Event described in
                                        paragraph 5 above, and its
                                        determinations and calculations with
                                        respect thereto shall be conclusive.

                                        The Calculation Agent will provide
                                        information as to any adjustments to
                                        the Exchange Factor or method of
                                        calculating the Exchange Factor upon
                                        written request by any Holder of this
                                        Note.

Alternate Exchange Calculation in
case of an Event of Default...........  In case an Event of Default with
                                        respect to this

                                      13
<PAGE>

                                        Note shall have occurred and be
                                        continuing, the amount declared due and
                                        payable upon any acceleration of this
                                        Note shall be determined by the
                                        Calculation Agent, and shall be equal
                                        to the principal amount of this Note
                                        plus any accrued interest to but not
                                        including the date of acceleration.

Calculation Agent.....................  ABN AMRO Incorporated ("AAI"). All
                                        determinations made by the Calculation
                                        Agent will be at the sole discretion of
                                        the Calculation Agent and shall, in the
                                        absence of manifest error, be
                                        conclusive for all purposes and binding
                                        on the Holders and on the Issuer.

Additional Amounts....................  The Issuer shall, subject to certain
                                        exceptions and limitations set forth
                                        below, pay such additional amounts (the
                                        "Additional Amounts") to each holder of
                                        this Note as may be necessary in order
                                        that the net payment of the principal
                                        of this Note and any other amounts
                                        payable on this Note, after withholding
                                        for or on account of any present or
                                        future tax, assessment or governmental
                                        charge imposed upon or as a result of
                                        such payment by The Netherlands (or any
                                        political subdivision or taxing
                                        authority thereof or therein) or the
                                        jurisdiction of residence or
                                        incorporation of any successor
                                        corporation or any jurisdiction from or
                                        through which any amount is paid by the
                                        Issuer or a successor corporation, will
                                        not be less than the amount provided
                                        for in this Note to be then due and
                                        payable. The Issuer shall not, however,
                                        be required to make any payment of
                                        Additional Amounts to any such holder
                                        for or on account of:

                                      14
<PAGE>

                                        (a)   any such tax, assessment or other
                                              governmental charge that would not
                                              have been so imposed but for (i)
                                              the existence of any present or
                                              former connection between such
                                              holder (or between a fiduciary,
                                              settlor, beneficiary, member or
                                              shareholder of such holder, if
                                              such holder is an estate, a trust,
                                              a partnership or a corporation)
                                              and The Netherlands and its
                                              possessions, including, without
                                              limitation, such holder (or such
                                              fiduciary, settlor, beneficiary,
                                              member or shareholder) being or
                                              having been a citizen or resident
                                              thereof or being or having been
                                              engaged in a trade or business or
                                              present therein or having, or
                                              having had, a permanent
                                              establishment therein or (ii) the
                                              presentation, where presentation
                                              is required, by the holder of this
                                              Note for payment on a date more
                                              than 30 days after the date on
                                              which such payment became due and
                                              payable or the date on which
                                              payment thereof is duly provided
                                              for, whichever occurs later;

                                        (b)   any estate, inheritance, gift,
                                              sales, transfer or personal
                                              property tax or any similar tax,
                                              assessment or governmental charge;

                                        (c)   any tax, assessment or other
                                              governmental charge that is
                                              payable otherwise than by
                                              withholding from payments on or in
                                              respect of this Note;

                                        (d)   any tax, assessment or other
                                              governmental charge required to be
                                              withheld by any paying agent from
                                              any payment of principal of, or
                                              supplemental redemption amount on,
                                              this Note, if such payment can be
                                              made without such withholding by
                                              presentation of this Note to any
                                              other paying agent;

                                         15
<PAGE>

                                        (e)   any tax, assessment or other
                                              governmental charge that would not
                                              have been imposed but for a
                                              holder's failure to comply with a
                                              request addressed to the holder
                                              or, if different, the beneficiary
                                              of the payment, to comply with
                                              certification, information or
                                              other reporting requirements
                                              concerning the nationality,
                                              residence or identity of the
                                              holder or beneficial owner of this
                                              Note, if such compliance is
                                              required by statute or by
                                              regulation of The Netherlands (or
                                              other relevant jurisdiction), or
                                              of any political subdivision or
                                              taxing authority thereof or
                                              therein, as a precondition to
                                              relief or exemption from such tax,
                                              assessment or other governmental
                                              charge; or

                                        (f)   any combination of items (a), (b),
                                              (c), (d) or (e);

                                        nor shall Additional Amounts be paid
                                        with respect to any payment on this
                                        Note to a holder who is a fiduciary or
                                        partnership or other than the sole
                                        beneficial owner of such payment to the
                                        extent such payment would be required
                                        by the laws of The Netherlands (or
                                        other relevant jurisdiction), or any
                                        political subdivision thereof, to be
                                        included in the income, for tax
                                        purposes, of a beneficiary or settlor
                                        with respect to such fiduciary or a
                                        member of such partnership or a
                                        beneficial owner who would not have
                                        been entitled to the Additional Amounts
                                        had such beneficiary, settlor, member
                                        or beneficial owner been the holder of
                                        this Note.

     ABN AMRO Bank N.V., a public limited liability company incorporated under
the laws of The Netherlands and with corporate seat in Amsterdam (together with
its successors and assigns, the "Issuer"), for value received, hereby promises
to pay to CEDE & CO., or registered assignees, the principal sum of U.S.
$5,000,000 (UNITED STATES DOLLARS FIVE MILLION), on the Maturity Date specified
above (except to the extent redeemed or repaid prior to maturity) and to pay
interest

                                      16
<PAGE>

thereon at the Interest Rate per annum specified above, from and including the
Interest Accrual Date specified above until the principal hereof is paid or
duly made available for payment weekly, monthly, quarterly, semiannually or
annually in arrears as specified above as the Interest Payment Period on each
Interest Payment Date (as specified above), commencing on the Interest Payment
Date next succeeding the Interest Accrual Date specified above, and at maturity
(or on any redemption or repayment date); provided, however, that if the
Interest Accrual Date occurs between a Record Date, as defined below, and the
next succeeding Interest Payment Date, interest payments will commence on the
second Interest Payment Date succeeding the Interest Accrual Date to the
registered holder of this Note on the Record Date with respect to such second
Interest Payment Date; and provided, further, that if this Note is subject to
"Annual Interest Payments," interest payments shall be made annually in arrears
and the term "Interest Payment Date" shall be deemed to mean the first day of
March in each year.

     Interest on this Note will accrue from and including the most recent date
to which interest has been paid or duly provided for, or, if no interest has
been paid or duly provided for, from and including the Interest Accrual Date,
until, but excluding the date the principal hereof has been paid or duly made
available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, subject to certain exceptions
described herein, be paid to the person in whose name this Note (or one or more
predecessor Notes) is registered at the close of business on the date 15
calendar days prior to such Interest Payment Date (whether or not a Business
Day (as defined below)) (each such date a "Record Date"); provided, however,
that interest payable at maturity (or any redemption or repayment date) will be
payable to the person to whom the principal hereof shall be payable. As used
herein, "Business Day" means any day, other than a Saturday or Sunday, (a) that
is neither a legal holiday nor a day on which banking institutions are
authorized or required by law or regulation to close (x) in The City of New
York or (y) if this Note is denominated in a Specified Currency other than U.S.
dollars, Australian dollars or euro, in the principal financial center of the
country of the Specified Currency, or (z) if this Note is denominated in
Australian dollars, in Sydney and (b) if this Note is denominated in euro, that
is also a day on which the Trans-European Automated Real-time Gross Settlement
Express Transfer System ("TARGET") is operating (a "TARGET Settlement Day").

     Payment of the principal of this Note, any premium and the interest due at
maturity (or any redemption or repayment date), unless this Note is denominated
in a Specified Currency other than U.S. dollars and is to be paid in whole or
in part in such Specified Currency, will be made in immediately available funds
upon surrender of this Note at the office or agency of the Paying Agent, as
defined on the reverse hereof, maintained for that purpose in the Borough of
Manhattan, The City of New York, or at such other paying agency as the Issuer
may determine, in U.S. dollars. U.S. dollar payments of interest, other than
interest due at maturity or on any date of redemption or repayment, will be
made by U.S. dollar check mailed to the address of the person entitled thereto
as such address shall appear in the Note register. A holder of U.S. $10,000,000
(or the equivalent in a Specified Currency) or more in aggregate principal
amount of Notes having the same Interest Payment Date, the interest on which is
payable in U.S. dollars, shall be entitled to receive payments of interest,
other than interest due at maturity or on any date of redemption or repayment,
by wire

                                      17
<PAGE>

transfer of immediately available funds if appropriate wire transfer
instructions have been received by the Paying Agent in writing not less than 15
calendar days prior to the applicable Interest Payment Date.

     If this Note is denominated in a Specified Currency other than U.S.
dollars, and the holder does not elect (in whole or in part) to receive payment
in U.S. dollars pursuant to the next succeeding paragraph, payments of
interest, principal or any premium with regard to this Note will be made by
wire transfer of immediately available funds to an account maintained by the
holder hereof with a bank located outside the United States if appropriate wire
transfer instructions have been received by the Paying Agent in writing, with
respect to payments of interest, on or prior to the fifth Business Day after
the applicable Record Date and, with respect to payments of principal or any
premium, at least ten Business Days prior to the Maturity Date or any
redemption or repayment date, as the case may be; provided that, if payment of
interest, principal or any premium with regard to this Note is payable in euro,
the account must be a euro account in a country for which the euro is the
lawful currency, provided, further, that if such wire transfer instructions are
not received, such payments will be made by check payable in such Specified
Currency mailed to the address of the person entitled thereto as such address
shall appear in the Note register; and provided, further, that payment of the
principal of this Note, any premium and the interest due at maturity (or on any
redemption or repayment date) will be made upon surrender of this Note at the
office or agency referred to in the preceding paragraph.

     If so indicated on the face hereof, the holder of this Note, if
denominated in a Specified Currency other than U.S. dollars, may elect to
receive all or a portion of payments on this Note in U.S. dollars by
transmitting a written request to the Paying Agent, on or prior to the fifth
Business Day after such Record Date or at least ten Business Days prior to the
Maturity Date or any redemption or repayment date, as the case may be. Such
election shall remain in effect unless such request is revoked by written
notice to the Paying Agent as to all or a portion of payments on this Note at
least five Business Days prior to such Record Date, for payments of interest,
or at least ten days prior to the Maturity Date or any redemption or repayment
date, for payments of principal, as the case may be.

     If the holder elects to receive all or a portion of payments of principal
of and any premium and interest on this Note, if denominated in a Specified
Currency other than U.S. dollars, in U.S. dollars, the Exchange Rate Agent (as
defined on the reverse hereof) will convert such payments into U.S. dollars. In
the event of such an election, payment in respect of this Note will be based
upon the exchange rate as determined by the Exchange Rate Agent based on the
highest bid quotation in The City of New York received by such Exchange Rate
Agent at approximately 11:00 a.m., New York City time, on the second Business
Day preceding the applicable payment date from three recognized foreign
exchange dealers (one of which may be the Exchange Rate Agent unless such
Exchange Rate Agent is an affiliate of the Issuer) for the purchase by the
quoting dealer of U.S. dollars for the Specified Currency for settlement on
such payment date in the amount of the Specified Currency payable in the
absence of such an election to such holder and at which the applicable dealer
commits to execute a contract. If such bid quotations are not available, such
payment will be made in the

                                      18
<PAGE>

Specified Currency. All currency exchange costs will be borne by the holder of
this Note by deductions from such payments.

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

     Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Note shall
not be entitled to any benefit under the Indenture, as defined on the reverse
hereof, or be valid or obligatory for any purpose.

                                      19
<PAGE>

     IN WITNESS WHEREOF, the Issuer has caused this Note to be duly executed.

DATED:                                     ABN AMRO BANK N.V.

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

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

TRUSTEE'S CERTIFICATE
      OF AUTHENTICATION

This is one of the Notes referred
   to in the within-mentioned
   Indenture.

JPMORGAN CHASE BANK,
   as Trustee

By:
   ---------------------------------
   Authorized Officer

<PAGE>

                              REVERSE OF SECURITY

     This Note is one of a duly authorized issue of Global Medium-Term Notes,
Series A, having maturities more than nine months from the date of issue (the
"Notes") of the Issuer. The Notes are issuable under an Indenture, dated as of
November 27, 2000, between the Issuer and JPMorgan Chase Bank, as Trustee (the
"Trustee," which term includes any successor trustee under the Indenture) (as
may be amended or supplemented from time to time, the "Indenture"), to which
Indenture and all indentures supplemental thereto reference is hereby made for
a statement of the respective rights, limitations of rights, duties and
immunities of the Issuer, the Trustee and holders of the Notes and the terms
upon which the Notes are, and are to be, authenticated and delivered. The
Issuer has appointed JPMorgan Chase Bank at its corporate trust office in The
City of New York as the paying agent (the "Paying Agent," which term includes
any additional or successor Paying Agent appointed by the Issuer) with respect
to the Notes. The terms of individual Notes may vary with respect to interest
rates, interest rate formulas, issue dates, maturity dates, or otherwise, all
as provided in the Indenture. To the extent not inconsistent herewith, the
terms of the Indenture are hereby incorporated by reference herein.

     Unless otherwise indicated on the face hereof, this Note will not be
subject to any sinking fund and, unless otherwise provided on the face hereof
in accordance with the provisions of the following two paragraphs, will not be
redeemable or subject to repayment at the option of the holder prior to
maturity.

     If so indicated on the face hereof, this Note may be redeemed in whole or
in part at the option of the Issuer on or after the Initial Redemption Date
specified on the face hereof on the terms set forth on the face hereof,
together with interest accrued and unpaid hereon to the date of redemption. If
this Note is subject to "Annual Redemption Percentage Reduction," the Initial
Redemption Percentage indicated on the face hereof will be reduced on each
anniversary of the Initial Redemption Date by the Annual Redemption Percentage
Reduction specified on the face hereof until the redemption price of this Note
is 100% of the principal amount hereof, together with interest accrued and
unpaid hereon to the date of redemption. Notice of redemption shall be mailed
to the registered holders of the Notes designated for redemption at their
addresses as the same shall appear on the Note register not less than 30 nor
more than 60 days prior to the date fixed for redemption or within the
Redemption Notice Period specified on the face hereof, subject to all the
conditions and provisions of the Indenture. In the event of redemption of this
Note in part only, a new Note or Notes for the amount of the unredeemed portion
hereof shall be issued in the name of the holder hereof upon the cancellation
hereof.

     If so indicated on the face of this Note, this Note will be subject to
repayment at the option of the holder on the Optional Repayment Date or Dates
specified on the face hereof on the terms set forth herein. On any Optional
Repayment Date, this Note will be repayable in whole or in part in increments
of $1,000 or, if this Note is denominated in a Specified Currency other than
U.S. dollars, in increments of 1,000 units of such Specified Currency (provided
that any remaining principal amount hereof shall not be less than the minimum
authorized denomination hereof) at the option of

<PAGE>

the holder hereof at a price equal to 100% of the principal amount to be
repaid, together with interest accrued and unpaid hereon to the date of
repayment. For this Note to be repaid at the option of the holder hereof, the
Paying Agent must receive at its corporate trust office in the Borough of
Manhattan, The City of New York, at least 15 but not more than 30 days prior to
the date of repayment, (i) this Note with the form entitled "Option to Elect
Repayment" below duly completed or (ii) a telegram, telex, facsimile
transmission or a letter from a member of a national securities exchange or the
National Association of Securities Dealers, Inc. or a commercial bank or a
trust company in the United States setting forth the name of the holder of this
Note, the principal amount hereof, the certificate number of this Note or a
description of this Note's tenor and terms, the principal amount hereof to be
repaid, a statement that the option to elect repayment is being exercised
thereby and a guarantee that this Note, together with the form entitled "Option
to Elect Repayment" duly completed, will be received by the Paying Agent not
later than the fifth Business Day after the date of such telegram, telex,
facsimile transmission or letter; provided, that such telegram, telex,
facsimile transmission or letter shall only be effective if this Note and form
duly completed are received by the Paying Agent by such fifth Business Day.
Exercise of such repayment option by the holder hereof shall be irrevocable. In
the event of repayment of this Note in part only, a new Note or Notes for the
amount of the unpaid portion hereof shall be issued in the name of the holder
hereof upon the cancellation hereof.

     Interest payments on this Note will include interest accrued to but
excluding the Interest Payment Dates or the Maturity Date (or any earlier
redemption or repayment date), as the case may be. Unless otherwise provided on
the face hereof, interest payments for this Note will be computed and paid on
the basis of a 360-day year of twelve 30-day months.

     In the case where the Interest Payment Date or the Maturity Date (or any
redemption or repayment date) does not fall on a Business Day, payment of
interest, premium, if any, or principal otherwise payable on such date need not
be made on such date, but may be made on the next succeeding Business Day with
the same force and effect as if made on the Interest Payment Date or on the
Maturity Date (or any redemption or repayment date), and no interest on such
payment shall accrue for the period from and after the Interest Payment Date or
the Maturity Date (or any redemption or repayment date) to such next succeeding
Business Day.

     This Note and all the obligations of the Issuer hereunder are direct,
unsecured obligations of the Issuer and rank without preference or priority
among themselves and pari passu with all other existing and future unsecured
and unsubordinated indebtedness of the Issuer, subject to certain statutory
exceptions in the event of liquidation upon insolvency.

     This Note, and any Note or Notes issued upon transfer or exchange hereof,
is issuable only in fully registered form, without coupons, and, if denominated
in U.S. dollars, unless otherwise stated above, is issuable only in
denominations of U.S. $1,000 and any integral multiple of U.S. $1,000 in excess
thereof. If this Note is denominated in a Specified Currency other than U.S.
dollars, then, unless a higher minimum denomination is required by applicable
law, it is issuable only in denominations of the equivalent of U.S. $1,000
(rounded to an integral multiple of 1,000 units of

<PAGE>

such Specified Currency), or any amount in excess thereof which is an integral
multiple of 1,000 units of such Specified Currency, as determined by reference
to the noon dollar buying rate in The City of New York for cable transfers of
such Specified Currency published by the Federal Reserve Bank of New York (the
"Market Exchange Rate") on the Business Day immediately preceding the date of
issuance.

     The Trustee has been appointed registrar for the Notes, and the Trustee
will maintain at its office in The City of New York a register for the
registration and transfer of Notes. This Note may be transferred at the
aforesaid office of the Trustee by surrendering this Note for cancellation,
accompanied by a written instrument of transfer in form satisfactory to the
Trustee and duly executed by the registered holder hereof in person or by the
holder's attorney duly authorized in writing, and thereupon the Trustee shall
issue in the name of the transferee or transferees, in exchange herefor, a new
Note or Notes having identical terms and provisions and having a like aggregate
principal amount in authorized denominations, subject to the terms and
conditions set forth herein; provided, however, that the Trustee will not be
required (i) to register the transfer of or exchange any Note that has been
called for redemption in whole or in part, except the unredeemed portion of
Notes being redeemed in part, (ii) to register the transfer of or exchange any
Note if the holder thereof has exercised his right, if any, to require the
Issuer to repurchase such Note in whole or in part, except the portion of such
Note not required to be repurchased, or (iii) to register the transfer of or
exchange Notes to the extent and during the period so provided in the Indenture
with respect to the redemption of Notes. Notes are exchangeable at said office
for other Notes of other authorized denominations of equal aggregate principal
amount having identical terms and provisions. All such exchanges and transfers
of Notes will be free of charge, but the Issuer may require payment of a sum
sufficient to cover any tax or other governmental charge in connection
therewith. All Notes surrendered for exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Trustee and executed by the
registered holder in person or by the holder's attorney duly authorized in
writing. The date of registration of any Note delivered upon any exchange or
transfer of Notes shall be such that no gain or loss of interest results from
such exchange or transfer.

     In case this Note shall at any time become mutilated, defaced or be
destroyed, lost or stolen and this Note or evidence of the loss, theft or
destruction thereof (together with the indemnity hereinafter referred to and
such other documents or proof as may be required in the premises) shall be
delivered to the Trustee, the Issuer in its discretion may execute a new Note
of like tenor in exchange for this Note, but, if this Note is destroyed, lost
or stolen, only upon receipt of evidence satisfactory to the Trustee and the
Issuer that this Note was destroyed or lost or stolen and, if required, upon
receipt also of indemnity satisfactory to each of them. All expenses and
reasonable charges associated with procuring such indemnity and with the
preparation, authentication and delivery of a new Note shall be borne by the
owner of the Note mutilated, defaced, destroyed, lost or stolen.

     The Indenture provides that (a) if an Event of Default (as defined in the
Indenture) due to the default in payment of principal of, premium, if any, or
interest on, any series of debt securities issued under the Indenture,
including the series of Medium-Term Notes of which this Note forms a part,

<PAGE>

or due to the default in the performance or breach of any other covenant or
warranty of the Issuer applicable to the debt securities of such series but not
applicable to all outstanding debt securities issued under the Indenture shall
have occurred and be continuing, either the Trustee or the holders of not less
than 25% in principal amount of the debt securities of each affected series
(voting as a single class) may then declare the principal of all debt
securities of all such series and interest accrued thereon to be due and
payable immediately and (b) if an Event of Default due to a default in the
performance of any other of the covenants or agreements in the Indenture
applicable to all outstanding debt securities issued thereunder, including this
Note, or due to certain events of bankruptcy or insolvency of the Issuer, shall
have occurred and be continuing, either the Trustee or the holders of not less
than 25% in principal amount of all debt securities issued under the Indenture
then outstanding (treated as one class) may declare the principal of all such
debt securities and interest accrued thereon to be due and payable immediately,
but upon certain conditions such declarations may be annulled and past defaults
may be waived (except a continuing default in payment of principal (or premium,
if any) or interest on such debt securities) by the holders of a majority in
principal amount of the debt securities of all affected series then
outstanding.

     If the face hereof indicates that this Note is subject to "Modified
Payment upon Acceleration," then (i) if the principal hereof is declared to be
due and payable as described in the preceding paragraph, the amount of
principal due and payable with respect to this Note shall be limited to the
aggregate principal amount hereof multiplied by the sum of the Issue Price
specified on the face hereof (expressed as a percentage of the aggregate
principal amount) plus the original issue discount amortized from the Interest
Accrual Date to the date of declaration, which amortization shall be calculated
using the "interest method" (computed in accordance with generally accepted
accounting principles in effect on the date of declaration), (ii) for the
purpose of any vote of securityholders taken pursuant to the Indenture prior to
the acceleration of payment of this Note, the principal amount hereof shall
equal the amount that would be due and payable hereon, calculated as set forth
in clause (i) above, if this Note were declared to be due and payable on the
date of any such vote and (iii) for the purpose of any vote of securityholders
taken pursuant to the Indenture following the acceleration of payment of this
Note, the principal amount hereof shall equal the amount of principal due and
payable with respect to this Note, calculated as set forth in clause (i) above.

     The Indenture permits the Issuer and the Trustee, with the consent of the
holders of not less than a majority in aggregate principal amount of the debt
securities of all series issued under the Indenture then outstanding and
affected (voting as one class), to execute supplemental indentures adding any
provisions to or changing in any manner the rights of the holders of each
series so affected; provided that the Issuer and the Trustee may not, without
the consent of the holder of each outstanding debt security affected thereby,
(a) extend the final maturity of any such debt security, or reduce the
principal amount thereof, or reduce the rate or extend the time of payment of
interest thereon, or reduce any amount payable on redemption or repayment
thereof, or change the currency of payment thereof, or modify or amend the
provisions for conversion of any currency into any other currency, or modify or
amend the provisions for conversion or exchange of the debt security for
securities of the Issuer or other entities (other than as provided in the
antidilution provisions or other

<PAGE>

similar adjustment provisions of the debt securities or otherwise in accordance
with the terms thereof), or impair or affect the rights of any holder to
institute suit for the payment thereof without the consent of the holder of
each debt security so affected or (b) reduce the aforesaid percentage in
principal amount of debt securities the consent of the holders of which is
required for any such supplemental indenture.

     Except as set forth below, if the principal of, premium, if any, or
interest on, this Note is payable in a Specified Currency other than U.S.
dollars and such Specified Currency is not available to the Issuer for making
payments hereon due to the imposition of exchange controls or other
circumstances beyond the control of the Issuer or is no longer used by the
government of the country issuing such currency or for the settlement of
transactions by public institutions within the international banking community,
then the Issuer will be entitled to satisfy its obligations to the holder of
this Note by making such payments in U.S. dollars on the basis of the Market
Exchange Rate on the date of such payment or, if the Market Exchange Rate is
not available on such date, as of the most recent practicable date; provided,
however, that if the euro has been substituted for such Specified Currency, the
Issuer may at its option (or shall, if so required by applicable law) without
the consent of the holder of this Note effect the payment of principal of,
premium, if any, or interest on, any Note denominated in such Specified
Currency in euro in lieu of such Specified Currency in conformity with legally
applicable measures taken pursuant to, or by virtue of, the treaty establishing
the European Community (the "EC"), as amended by the treaty on European Union
(as so amended, the "Treaty"). Any payment made under such circumstances in
U.S. dollars or euro where the required payment is in an unavailable Specified
Currency will not constitute an Event of Default. If such Market Exchange Rate
is not then available to the Issuer or is not published for a particular
Specified Currency, the Market Exchange Rate will be based on the highest bid
quotation in The City of New York received by the Exchange Rate Agent at
approximately 11:00 a.m., New York City time, on the second Business Day
preceding the date of such payment from three recognized foreign exchange
dealers (the "Exchange Dealers") for the purchase by the quoting Exchange
Dealer of the Specified Currency for U.S. dollars for settlement on the payment
date, in the aggregate amount of the Specified Currency payable to those
holders or beneficial owners of Notes and at which the applicable Exchange
Dealer commits to execute a contract. One of the Exchange Dealers providing
quotations may be the Exchange Rate Agent unless the Exchange Rate Agent is an
affiliate of the Issuer. If those bid quotations are not available, the
Exchange Rate Agent shall determine the market exchange rate at its sole
discretion.

     The "Exchange Rate Agent," if any, shall be indicated on the face hereof.

     All determinations referred to above made by, or on behalf of, the Issuer
or by, or on behalf of, the Exchange Rate Agent shall be at such entity's sole
discretion and shall, in the absence of manifest error, be conclusive for all
purposes and binding on holders of Notes and coupons.

     So long as this Note shall be outstanding, the Issuer will cause to be
maintained an office or agency for the payment of the principal of and premium,
if any, and interest on this Note as herein provided in the Borough of
Manhattan, The City of New York, and an office or agency in said

<PAGE>

Borough of Manhattan for the registration, transfer and exchange as aforesaid
of the Notes. The Issuer may designate other agencies for the payment of said
principal, premium and interest at such place or places (subject to applicable
laws and regulations) as the Issuer may decide. So long as there shall be such
an agency, the Issuer shall keep the Trustee advised of the names and locations
of such agencies, if any are so designated.

     With respect to moneys paid by the Issuer and held by the Trustee or any
Paying Agent for payment of the principal of or interest or premium, if any, on
any Notes that remain unclaimed at the end of two years after such principal,
interest or premium shall have become due and payable (whether at maturity or
upon call for redemption or otherwise), (i) the Trustee or such Paying Agent
shall notify the holders of such Notes that such moneys shall be repaid to the
Issuer and any person claiming such moneys shall thereafter look only to the
Issuer for payment thereof and (ii) such moneys shall be so repaid to the
Issuer. Upon such repayment all liability of the Trustee or such Paying Agent
with respect to such moneys shall thereupon cease, without, however, limiting
in any way any obligation that the Issuer may have to pay the principal of or
interest or premium, if any, on this Note as the same shall become due.

     No provision of this Note or of the Indenture shall alter or impair the
obligation of the Issuer, which is absolute and unconditional, to pay the
principal of, premium, if any, and interest on this Note at the time, place,
and rate, and in the coin or currency, herein prescribed unless otherwise
agreed between the Issuer and the registered holder of this Note.

     Prior to due presentment of this Note for registration of transfer, the
Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the
holder in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and none of the Issuer, the
Trustee or any such agent shall be affected by notice to the contrary.

     No recourse shall be had for the payment of the principal of, premium, if
any, or the interest on this Note, for any claim based hereon, or otherwise in
respect hereof, or based on or in respect of the Indenture or any indenture
supplemental thereto, against any incorporator, shareholder, officer or
director, as such, past, present or future, of the Issuer or of any successor
corporation, either directly or through the Issuer or any successor
corporation, whether by virtue of any constitution, statute or rule of law or
by the enforcement of any assessment or penalty or otherwise, all such
liability being, by the acceptance hereof and as part of the consideration for
the issue hereof, expressly waived and released.

     This Note shall for all purposes be governed by, and construed in
accordance with, the laws of the State of New York.

     All terms used in this Note which are defined in the Indenture and not
otherwise defined herein shall have the meanings assigned to them in the
Indenture.

<PAGE>

                                 ABBREVIATIONS

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

            TEN COM  -  as tenants in common
            TEN ENT  -  as tenants by the entireties
            JT TEN   -  as joint tenants with right of survivorship and not
                        as tenants in common

      UNIF GIFT MIN ACT - ____________________ Custodian _____________________
                                 (Minor)                        (Cust)

      Under Uniform Gifts to Minors Act _________________________________
                                                    (State)

       Additional abbreviations may also be used though not in the above list.

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

<PAGE>

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

----------------------------------------
[PLEASE INSERT SOCIAL SECURITY OR OTHER
   IDENTIFYING NUMBER OF ASSIGNEE]

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

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

-------------------------------------------------------------------------------
[PLEASE PRINT OR TYPE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE]

the within Note and all rights thereunder, hereby irrevocably constituting and
appointing such person attorney to transfer such note on the books of the
Issuer, with full power of substitution in the premises.

Dated:
      ----------------------------

NOTICE: The signature to this assignment must correspond with the name as
        written upon the face of the within Note in every particular without
        alteration or enlargement or any change whatsoever.

<PAGE>

                           OPTION TO ELECT REPAYMENT

The undersigned hereby irrevocably requests and instructs the Issuer to repay
the within Note (or portion thereof specified below) pursuant to its terms at a
price equal to the principal amount thereof, together with interest to the
Optional Repayment Date, to the undersigned at

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

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

-------------------------------------------------------------------------------
        (Please print or typewrite name and address of the undersigned)

     If less than the entire principal amount of the within Note is to be
repaid, specify the portion thereof which the holder elects to have repaid: ;
and specify the denomination or denominations (which shall not be less than the
minimum authorized denomination) of the Notes to be issued to the holder for
the portion of the within Note not being repaid (in the absence of any such
specification, one such Note will be issued for the portion not being
repaid):_________________.

Dated:
      ------------------------          ---------------------------------------
                                        NOTICE: The signature on this Option to
                                        Elect Repayment must correspond with
                                        the name as written upon the face of
                                        the within instrument in every
                                        particular without alteration or
                                        enlargement.

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