Document:

EXHIBIT 4.4

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                                    INDENTURE

                                      among

                               FOSTER WHEELER LTD.

                                 As the Company

                               FOSTER WHEELER LLC

                                As the Guarantor

                                       and

                           BNY MIDWEST TRUST COMPANY,

                                   as Trustee

                  6.50% CONVERTIBLE SUBORDINATED NOTES DUE 2007

                            Dated as of May 31, 2001

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                             CROSS-REFERENCE TABLE*

Trust Indenture                                                       Indenture
Act Section                                                            Section
-----------                                                          -----------
310(a)(1)........................................................           5.11
     (a)(2)......................................................           5.11
     (a)(3)......................................................            N/a
     (a)(4)......................................................            N/a
     (a)(5)......................................................           5.11
     (b)......................................................... 5.3; 5.5; 5.11
     (c).........................................................            N/a
311(a)...........................................................           5.12
     (b).........................................................           5.12
     (c).........................................................            N/a
312(a)...........................................................           2.10
     (b).........................................................           15.3
     (c).........................................................           15.3
313(a)...........................................................            5.7
     (b)(1)......................................................            n/a
     (b)(2)......................................................            5.7
     (c).........................................................      5.7; 15.2
     (d).........................................................            5.7
314(a)(1), (2), (3)..............................................      9.4; 15.6
     (a)(4)...................................................... 9.4; 9.5; 15.6
     (b).........................................................            N/a
     (c)(1)......................................................           13.5
     (c)(2)......................................................           13.5
     (c)(3)......................................................            N/a
     (d).........................................................            N/a
     (e).........................................................           15.6
     (f).........................................................            N/a
315(a)...........................................................         5.1(a)
     (b).........................................................      5.6; 15.2
     (c).........................................................         5.1(b)
     (d).........................................................         5.1(c)
     (e).........................................................           4.14
316(a)(last sentence)............................................           2.13
     (a)(1)(A)...................................................            4.5
     (a)(1)(B)...................................................            4.4

                                        i

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     (a)(2)......................................................            N/a
     (b).........................................................            4.7
     (c).........................................................            7.4
317(a)(1)........................................................            4.8
     (a)(2)......................................................            4.9
     (b).........................................................            2.5
318(a)...........................................................           15.1
     (b).........................................................            N/a
     (c).........................................................           15.1
------------------
"n/a" means not applicable.

*     This Cross-Reference  Table shall not, for any purpose, be deemed to be a
part of the Indenture.

                                       ii

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                                TABLE OF CONTENTS

                                                                           Page

Article I  DEFINITIONS AND INCORPORATION BY REFERENCE..........................1
   Section 1.1    Definitions..................................................1
   Section 1.2    Incorporation by Reference of Trust Indenture Act...........14
   Section 1.3    Rules of Construction.......................................15

Article II  THE SECURITIES....................................................15
   Section 2.1    Title and Terms.............................................15
   Section 2.2    Form of Securities..........................................17
   Section 2.3    Legends.....................................................17
   Section 2.4    Execution, Authentication, Delivery and
                    Dating of the Securities..................................23
   Section 2.5    Registrar and Paying Agent..................................23
   Section 2.6    Paying Agent to Hold Assets in Trust........................24
   Section 2.7    General Provisions Relating to Transfer and Exchange........24
   Section 2.8    Book-Entry Provisions for the Global Securities.............25
   Section 2.9    Special Transfer Provisions.................................27
   Section 2.10   Holder Lists................................................29
   Section 2.11   Persons Deemed Owners.......................................29
   Section 2.12   Mutilated, Destroyed, Lost or Stolen Securities.............29
   Section 2.13   Treasury Securities.........................................30
   Section 2.14   Temporary Securities........................................30
   Section 2.15   Cancellation................................................31
   Section 2.16   CUSIP Numbers...............................................31
   Section 2.17   Defaulted Interest..........................................31

Article III  SATISFACTION AND DISCHARGE.......................................32
   Section 3.1    Satisfaction and Discharge of Indenture.....................32
   Section 3.2    Deposited Monies to be Held in Trust........................33
   Section 3.3    Return of Unclaimed Monies..................................33

Article IV  DEFAULTS AND REMEDIES.............................................34
   Section 4.1    Events of Default...........................................34
   Section 4.2    Acceleration of Maturity; Rescission and Annulment..........35
   Section 4.3    Other Remedies..............................................36
   Section 4.4    Waiver of Past Defaults.....................................36
   Section 4.5    Control by Majority.........................................37
   Section 4.6    Limitation on Suit..........................................37
   Section 4.7    Unconditional Rights of Holders to Receive
                    Payment and to Convert....................................38
   Section 4.8    Collection of Indebtedness and Suits for
                    Enforcement by the Trustee................................38
   Section 4.9    Trustee May File Proofs of Claim............................38
   Section 4.10   Restoration of Rights and Remedies..........................39
   Section 4.11   Rights and Remedies Cumulative..............................39
   Section 4.12   Delay or Omission Not Waiver................................40
   Section 4.13   Application of Money Collected..............................40
   Section 4.14   Undertaking for Costs.......................................40

                                       iii

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                                                                            Page

   Section 4.15   Waiver of Stay or Extension Laws............................41

Article V  THE TRUSTEE....................................................... 41
   Section 5.1    Certain Duties and Responsibilities.........................41
   Section 5.2    Certain Rights of Trustee...................................43
   Section 5.3    Individual Rights of Trustee................................44
   Section 5.4    Money Held in Trust.........................................44
   Section 5.5    Trustee's Disclaimer........................................44
   Section 5.6    Notice of Defaults..........................................44
   Section 5.7    Reports by Trustee to Holders...............................44
   Section 5.8    Compensation and Indemnification............................45
   Section 5.9    Replacement of Trustee......................................45
   Section 5.10   Successor Trustee by Merger, Etc............................46
   Section 5.11   Corporate Trustee Required; Eligibility.....................46
   Section 5.12   Collection of Claims Against the Company....................47

Article VI  CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE..............47
   Section 6.1    Company and Guarantor May Consolidate, Etc.,
                    Only on Certain Terms.....................................47
   Section 6.2    Successor Corporation Substituted...........................48

Article VII  AMENDMENTS, SUPPLEMENTS AND WAIVERS..............................49
   Section 7.1    Without Consent of Holders of Securities....................49
   Section 7.2    With Consent of Holders of Securities.......................50
   Section 7.3    Compliance with Trust Indenture Act.........................51
   Section 7.4    Revocation of Consents and Effect of Consents or Votes......51
   Section 7.5    Notation on or Exchange of Securities.......................51
   Section 7.6    Trustee to Sign Amendment, Etc..............................52

Article VIII  MEETING OF HOLDERS OF SECURITIES................................52
   Section 8.1    Purposes for Which Meetings May Be Called...................52
   Section 8.2    Call Notice and Place of Meetings...........................52
   Section 8.3    Persons Entitled to Vote at Meetings........................53
   Section 8.4    Quorum; Action..............................................53
   Section 8.5    Determination of Voting Rights; Conduct and
                    Adjournment of Meetings...................................54
   Section 8.6    Counting Votes and Recording Action of Meetings.............54

Article IX  COVENANTS.........................................................55
   Section 9.1    Payment of Principal, Premium and Interest..................55
   Section 9.2    Maintenance of Offices or Agencies..........................55
   Section 9.3    Corporate Existence.........................................56
   Section 9.4    Reports.....................................................56
   Section 9.5    Compliance Certificate......................................56
   Section 9.6    Resale of Certain Securities................................57

Article X  REDEMPTION OF SECURITIES...........................................57
   Section 10.1   Optional Redemption.........................................57
   Section 10.2   Notice to Trustee...........................................58
   Section 10.3   Selection of Securities to Be Redeemed......................58

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                                                                            Page

   Section 10.4   Notice of Redemption........................................58
   Section 10.5   Effect of Notice of Redemption..............................59
   Section 10.6   Deposit of Redemption Price.................................60
   Section 10.7   Securities Redeemed in Part.................................60

Article XI  REPURCHASE AT THE OPTION OF A HOLDER..............................60
   Section 11.1   Repurchase Rights...........................................60
   Section 11.2   Notices; Method of Exercising Repurchase Right, Etc.........61

Article XII  CONVERSION OF SECURITIES.........................................63
   Section 12.1   Conversion Right and Conversion Price.......................63
   Section 12.2   Exercise of Conversion Right................................64
   Section 12.3   Fractions of Common Shares..................................65
   Section 12.4   Adjustment of Conversion Price..............................65
   Section 12.5   Notice of Adjustments of Conversion Price...................74
   Section 12.6   Notice Prior to Certain Actions.............................74
   Section 12.7   Company to Reserve Common Shares............................75
   Section 12.8   Covenant as to Common Shares................................75
   Section 12.9   Taxes on Conversions........................................75
   Section 12.10  Cancellation of Converted Securities........................76
   Section 12.11  Effect of Reclassification, Consolidation, Merger or Sale...76
   Section 12.12  Responsibility of Trustee for Conversion Provisions.........77

Article XIII  GUARANTEE.......................................................77
   Section 13.1   Guarantee...................................................78
   Section 13.2   Execution and Delivery of Guarantee.........................79
   Section 13.3   Guarantee Obligations Subordinated to
                  Guarantor Senior Debt.......................................80
   Section 13.4     Payment Over of Proceeds upon Dissolution, etc.,
                  of the Guarantor............................................80
   Section 13.5     Suspension of Guarantee Obligations When
                  Guarantor Senior Debt in Default............................81
   Section 13.6   Waiver of Subrogation.......................................82
   Section 13.7   Guarantee Subordination Provisions Solely To
                    Define Relative Rights....................................82
   Section 13.8   Trustee To Effectuate Subordination of
                    Guarantee Obligations.....................................83
   Section 13.9   No Waiver of Guarantee Subordination Provisions.............83
   Section 13.10  Guarantor To Give Notice to Trustee.........................84
   Section 13.11  Reliance on Judicial Order or Certificate of Liquidating
                    Agent Regarding Dissolution, etc., of Guarantor...........85
   Section 13.12  Rights of Trustee as a Holder of Guarantor Senior Debt;
                    Preservation of Trustee's Rights..........................85
   Section 13.13  Article Thirteen Applicable to Paying Agents................85
   Section 13.14  No Suspension of Remedies Subject to Rights of
                    Holders of Guarantor Senior Debt..........................85

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                                                                            Page

   Section 13.15  Trustee's Relation to Guarantor Senior Debt.................86
   Section 13.16  Subrogation.................................................86

Article XIV  SUBORDINATION OF NOTES...........................................87
   Section 14.1   Notes Subordinate to Senior Debt............................87
   Section 14.2   Payment Over of Proceeds upon Dissolution, etc..............87
   Section 14.3   Suspension of Payment When Designated Senior Debt
                    is in Default.............................................88
   Section 14.4   Trustee's Relation to Senior Debt...........................89
   Section 14.5   Subrogation to Rights of Holders of Senior Debt.............89
   Section 14.6   Provisions Solely To Define Relative Rights.................90
   Section 14.7   Trustee To Effectuate Subordination.........................90
   Section 14.8   No Waiver of Subordination Provisions.......................91
   Section 14.9   Notice to Trustee...........................................91
   Section 14.10  Reliance on Judicial Order or Certificate of
                    Liquidating Agent.........................................92
   Section 14.11  Rights of Trustee as a Holder of Senior Debt;
                    Preservation of Trustee's Rights..........................92
   Section 14.12  Article Applicable to Paying Agents.........................92
   Section 14.13  No Suspension of Remedies...................................93

Article XV  OTHER PROVISIONS OF GENERAL APPLICATION...........................93
   Section 15.1   Trust Indenture Act Controls................................93
   Section 15.2   Notices.....................................................93
   Section 15.3   Communication by Holders with Other Holders.................94
   Section 15.4   Acts of Holders of Securities...............................94
   Section 15.5   Certificate and Opinion as to Conditions Precedent..........95
   Section 15.6   Statements Required in Certificate or Opinion...............96
   Section 15.7   Effect of Headings and Table of Contents....................96
   Section 15.8   Successors and Assigns......................................96
   Section 15.9   Separability Clause.........................................96
   Section 15.10  Benefits of Indenture.......................................96
   Section 15.11  Section Governing Law.......................................96
   Section 15.12  Submission to Jurisdiction; Consent to Service; Waivers.....97
   Section 15.13  Counterparts................................................97
   Section 15.14  Legal Holidays..............................................97
   Section 15.15  Recourse Against Others.....................................97

                                       vi

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EXHIBITS

EXHIBIT A:.............................................Form of Security      A-1
EXHIBIT B:.............................................Form of Guarantee     B-1

                                      vii

<PAGE>

          INDENTURE,  dated as of May 31, 2001, among (i) Foster Wheeler Ltd., a
company  duly  organized  and  existing  under the laws of  Bermuda,  having its
principal office at Perryville  Corporate Park,  Clinton,  New Jersey 08809-4000
(the "Company"),  (ii) Foster Wheeler LLC, a Delaware limited  liability company
having its principal office at Perryville  Corporate Park,  Clinton,  New Jersey
08809-4000 (the "Guarantor"),  and (iii) BNY Midwest Trust Company,  an Illinois
banking  corporation,  not in its individual capacity but solely as Trustee (the
"Trustee"),  having its  principal  corporate  trust office at  Corporate  Trust
Division 2 North  LaSalle  Street,  Chicago,  IL 60602,  attn:  Corporate  Trust
Administration.

                             RECITALS OF THE COMPANY

          The Company has duly  authorized the creation of an issue of its 6.50%
Convertible  Subordinated  Notes due 2007 (herein  called the  "Securities")  of
substantially  the  tenor and  amount  hereinafter  set  forth,  and to  provide
therefor  the Company has duly  authorized  the  execution  and delivery of this
Indenture.

          All things  necessary to make the Securities,  when the Securities are
executed by the Company  and  authenticated  and  delivered  hereunder  and duly
issued by the Company,  the valid  obligations of the Company,  and to make this
Indenture a valid and legally  binding  agreement of the Company,  in accordance
with their and its terms, have been done.

                            RECITALS OF THE GUARANTOR

          The Guarantor has duly  authorized  the execution and delivery of this
Indenture  to provide,  with  respect to each  Security  issued  hereunder,  the
Guarantee provided for herein.

          All things  necessary to constitute  this  Indenture and the Guarantee
herein a valid and legally  binding  agreement of the  Guarantor,  in accordance
with their terms, have been done.

                   NOW, THEREFORE, THIS INDENTURE WITNESSETH:

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

                                    Article I

                   DEFINITIONS AND INCORPORATION BY REFERENCE

     Section 1.1  Definitions.

                                       1

<PAGE>

          For all purposes of this Indenture and the  Securities,  the following
terms are defined as follows:

          "Act",  when used with  respect to any Holder of a  Security,  has the
     meaning specified in Section 15.4(a).

          "Additional  Amounts" means all amounts,  if any,  payable pursuant to
     Section 3 of the Registration Rights Agreement.

          "Adjusted Interest Rate" means, with respect to any Reset Transaction,
     the rate per annum that is the  arithmetic  average of the rates  quoted by
     two Reference Dealers selected by the Company as the rate at which interest
     on the Securities should accrue so that the fair market value, expressed in
     dollars, of a Security immediately after the later of:

               (1) the public announcement of such Reset Transaction; or

               (2) the public  announcement  of a change in  dividend  policy in
          connection with such Reset Transaction;

     will equal the average  Trading Price of a Security for the 20 Trading Days
     preceding the date of such public announcement;  provided that the Adjusted
     Interest Rate shall not be less than 6.50% per annum.

          "Affiliate" of any specified Person means any other Person directly or
     indirectly  controlling or controlled by or under direct or indirect common
     control with such specified  Person.  For the purposes of this  definition,
     "control",  when used with respect to any specified Person, means the power
     to  direct  the  management  and  policies  of  such  Person,  directly  or
     indirectly, whether through the ownership of voting securities, by contract
     or otherwise;  and the terms  "controlling"  and "controlled" have meanings
     correlative to the foregoing.

          "Agent Members" has the meaning stated in Section 2.8.

          "Bankruptcy  Law" means  Chapter  11 of Title 11 of the United  States
     Code or any similar federal or state law for the relief of debtors.

          "Board of Directors" means the board of managers of the Company or any
     committee  of that  board  empowered  to act for it  with  respect  to this
     Indenture.

          "Board  Resolution"  means a  resolution  duly  adopted  by a Board of
     Directors  or such  committee  of the Board of Directors as officers of the
     Company to which  authority to act on behalf of the Board of Directors  has
     been delegated, a copy of which, certified by the Secretary or an Assistant
     Secretary  of the  Company,  to be in full  force and effect on the date of
     such certification, shall have been delivered to the Trustee.

          "Business  Day", when used with respect to (i) any Place of Payment or
     Place of Conversion,  means each Monday, Tuesday,  Wednesday,  Thursday and
     Friday which is not

                                       2

<PAGE>

     a day on which  banking  institutions  in that Place of Payment or Place of
     Conversion,  as the case may be,  are  authorized  or  obligated  by law to
     close, and (ii) the Trustee, each Monday, Tuesday, Wednesday,  Thursday and
     Friday  which is not a day on which  banking  institutions  in the city and
     state in which the Corporate  Trust Office is located are authorized by law
     to close.

          "Change of Control" means the occurrence of any of the following after
     the original issuance of the Securities:

               (3) the  acquisition  by any Person,  including  any syndicate or
          group deemed to be a "person"  under Section  13(d)(3) of the Exchange
          Act,  of  beneficial  ownership,  directly  or  indirectly,  through a
          purchase,  merger  or  other  acquisition  transaction  or  series  of
          transactions  of shares of the Company's  capital stock entitling that
          Person to exercise 50% or more of the total voting power of all shares
          of the Company's capital stock entitled to vote generally in elections
          of directors,  other than any  acquisition by the Company,  any of its
          subsidiaries,  or any of its employee  benefit plans (except that such
          Person shall be deemed to have beneficial  ownership of all securities
          that such  Person  has the right to  acquire,  whether  such  right is
          currently  exercisable or is exercisable only upon the occurrence of a
          subsequent condition); or

               (4) the first day on which a majority of the members of the board
          of directors of the Company are not continuing  directors or directors
          nominated by continuing directors; or

               (5) any  consolidation  or merger of the Company with or into any
          other Person,  any merger of another  Person into the Company,  or any
          conveyance,  transfer,  sale,  lease  or other  disposition  of all or
          substantially  all of the  properties  and  assets of the  Company  to
          another Person,  other than in each case (i) any such  transaction (x)
          that does not result in any reclassification,  conversion, exchange or
          cancellation of outstanding shares of capital stock of the Company and
          (y)  pursuant  to  which  holders  of  capital  stock  of the  Company
          immediately   prior  to  such  transaction  have  the  entitlement  to
          exercise,  directly  or  indirectly,  50% or more of the total  voting
          power of all shares of capital  stock of the Company  entitled to vote
          generally in the election of directors of the  continuing or surviving
          Person  immediately after such transaction;  or (ii) any merger solely
          for the purpose of changing  the  jurisdiction  of  incorporation  and
          resulting in a reclassification, conversion or exchange of outstanding
          shares of common  shares  solely into  shares of common  shares of the
          surviving entity.

     provided,  however,  that a Change of  Control  shall not be deemed to have
     occurred if (A) at least 90% of the  consideration  in the  transaction  or
     transactions constituting a Change of Control consists of securities traded
     or to be traded  immediately  following  such  Change of  Control on a U.S.
     national securities exchange or the Nasdaq National Market and, as a result
     of such  transaction or  transactions,  the Securities  become  convertible
     solely into such  securities;  or (B) the Trading Price per share of Common

                                       3

<PAGE>

     Shares  for any five  Trading  Days  within  the  period of 10  consecutive
     Trading Days ending immediately after the later of the Change of Control or
     the public  announcement of the Change of Control,  in the case of a Change
     of Control described in clause (1) of this definition of Change of Control,
     or the period of 10 consecutive  Trading Days ending immediately before the
     Change of Control,  in the case of a Change of Control  described in clause
     (2) of this definition of Change of Control,  shall equal or exceed 110% of
     the Conversion Price of the Securities in effect on each such Trading Day.

     As used in this definition,  the term "beneficial ownership" shall have the
     same  meaning as such term has in Rule 13d-3  promulgated  by the SEC under
     the Exchange  Act, and the term  "Person"  shall  include any  syndicate or
     group which would be deemed to be a "person" under Section  13(d)(3) of the
     Exchange Act.

          "Clearstream"  means  Clearstream  Banking,  societe anonyme (formerly
     Cedelbank).

          "Closing  Date"  means May 31,  2001 or such  later  date on which the
     Securities may be delivered pursuant to the Purchase Agreement.

          "Common  Shares"  means any and all equity  securities of any class of
     the Company  which has no  preference in respect of dividends or of amounts
     payable  in  the  event  of  any  voluntary  or  involuntary   liquidation,
     dissolution  or  winding  up of the  Company  and which is not  subject  to
     redemption  by the  Company;  provided,  however,  that shares  issuable on
     conversion of Securities shall include only common shares, $1.00 par value,
     of the  Company  or  shares  of any  class or  classes  resulting  from any
     reclassification or reclassifications  thereof and which have no preference
     in respect of dividends or of amounts payable in the event of any voluntary
     or  involuntary  liquidation,  dissolution or winding up of the Company and
     which are not subject to redemption by the Company; provided, however, that
     if at any time  there  shall be more  than one such  resulting  class,  the
     shares of each such class then so issuable  shall be  substantially  in the
     proportion  which the total number of shares of such class  resulting  from
     all such reclassifications  bears to the total number of shares of all such
     classes resulting from all such reclassifications.

          "Company"  means  the  Person  named  as the  "Company"  in the  first
     paragraph of this Indenture until a successor Person shall have become such
     pursuant to the  applicable  provisions of this  Indenture,  and thereafter
     "Company" shall mean such successor Person.

          "Company Notice" has the meaning specified in Section 11.2.

          "Company  Order"  means a  written  order  signed  in the  name of the
     Company by both (1) the Chairman of the Board, the Chief Executive Officer,
     the  President or a Vice  President  and (2) so long as not the same as the
     officer signing  pursuant to clause (1), the Chief Financial  Officer,  the
     Treasurer,   any  Assistant  Treasurer,  the  Secretary  or  the  Assistant
     Secretary of the Company, and delivered to the Trustee.

                                       4

<PAGE>

          "Conversion  Agent"  means any  Person  authorized  by the  Company to
     convert Securities in accordance with Article 12.

          "Conversion Price" has the meaning specified in Section 12.1.

          "Corporate  Trust  Office"  means  for  purposes  of  presentation  or
     surrender of Securities for payment,  registration,  transfer,  exchange or
     conversion or for service of notices or demands upon the Company or for any
     other  purpose  of this  Indenture,  the office of the  Trustee  located in
     Chicago,  Illinois  at which at any  particular  time its  corporate  trust
     business  shall be  administered  (which at the date of this  Indenture  is
     located at Chicago, Illinois).

          "corporation"  means  corporations,  associations,  limited  liability
     companies, companies and business trusts.

          "Current Market Price" has the meaning set forth in Section 12.4(g).

          "Custodian"  means  any  receiver,   trustee,  assignee,   liquidator,
     sequestrator or similar official under any Bankruptcy Law.

          "Default" means an event which is, or after notice or lapse of time or
     both would be, an Event of Default.

          "Defaulted Interest" has the meaning specified in Section 2.17.

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

          "Designated  Guarantor  Senior  Debt"  means the Senior  Bank Debt and
     other Guarantor  Senior Debt permitted to be incurred the principal  amount
     of which is $25  million  or more at the  time of the  designation  of such
     Senior Debt as  "Designated  Guarantor  Senior Debt" by the  Guarantor in a
     written instrument delivered to the Trustee.

          "Designated Senior Debt" means Senior Debt of the Company permitted to
     be  incurred  the  principal  amount of which is $25 million or more at the
     time of the designation of such Senior Debt as "Designated  Senior Debt" by
     the Company in a written instrument delivered to the Trustee.

          "Dividend  Yield" on any security  for any period means the  dividends
     paid or proposed to be paid  pursuant to an  announced  dividend  policy on
     such security for such period divided by, if with respect to dividends paid
     on such security,  the average  Trading Price of such security  during such
     period  and,  if with  respect  to  dividends  proposed  to be paid on such
     security,  the Trading Price of such security on the effective  date of the
     related Reset Transaction.

                                       5

<PAGE>

          "Dollar," "U.S. Dollar" or "U.S. $" means a dollar or other equivalent
     unit in such coin or currency of the United  States as at the time shall be
     legal tender for the payment of public and private debts.

          "Euroclear"  means  Euroclear  Bank  S.A/N.V.,   as  operator  of  the
     Euroclear System.

          "Event of Default" has the meaning specified in Section 4.1.

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

          "Expiration Time" has the meaning specified in Section 12.4(f).

          "fair market value" has the meaning set forth in Section 12.4(g).

          "Global Security" has the meaning specified in Section 2.2(b).

          "Guarantee"  means the  guarantee  of the  Guarantor  endorsed  on the
     Securities and shall include the guarantee set forth in Section 13.1.

          "Guarantor"  means the Person  named as the  "Guarantor"  in the first
     paragraph of this instrument.

          "Guarantor  Senior  Debt" means the  principal  of,  premium,  if any,
     interest (including all interest accruing subsequent to the commencement of
     any  bankruptcy  or  similar  proceeding,   whether  or  not  a  claim  for
     post-petition  interest is allowable as a claim in any such proceeding) and
     rent payable on or  termination  payment  with respect to or in  connection
     with, and all fees, costs,  expenses and other amounts accrued or due on or
     in connection  with, the Indebtedness of the Guarantor,  including  without
     limitation  Indebtedness  under (i) the  Senior  Bank  Debt,  (ii)  Robbins
     Facility Debt; and (iii) the Senior Notes,  whether outstanding on the date
     of this Indenture or subsequently created, incurred, assumed, guaranteed or
     in effect guaranteed by the Guarantor  (including all deferrals,  renewals,
     extensions or refundings  of, or amendments,  modifications  or supplements
     to, the foregoing), unless in the case of any particular Indebtedness,  the
     instrument  creating or evidencing  such  Indebtedness or the assumption or
     guarantee  thereof  expressly  provides that the Indebtedness  shall not be
     senior in right of payment to the  Securities  or expressly  provides  that
     such  Indebtedness  ranks  pari  passu  with or junior  to the  Securities;
     provided,  however,  the term "Guarantor  Senior Debt" does not include (i)
     the  Indebtedness  of the Guarantor to any of its  Subsidiaries,  including
     without  limitation,  Indebtedness  pursuant to those  certain 9.00% junior
     subordinated  notes  due  January  15,  2029;  (ii)  the  guarantee  of the
     Guarantor  in respect of the 9.00%  Preferred  Securities  of FW  Preferred
     Capital Trust I; or (iii) any other Indebtedness of the Guarantor, which by
     its terms ranks junior to or pari passu with the Guarantee.

          "Holder", when used with respect to any Security, including any Global
     Security,  means the Person in whose name the Security is registered in the
     Register.

                                       6

<PAGE>

          "Indebtedness" of any Person means, without duplication:

          (1)  all indebtedness,  obligations and other liabilities  (contingent
               or  otherwise)  of that  Person  for  borrowed  money  (including
               obligations in respect of overdrafts, foreign exchange contracts,
               currency   exchange   agreements,    interest   rate   protection
               agreements,  and any loans or advances from banks, whether or not
               evidenced by notes or similar instruments) or evidenced by bonds,
               notes,  notes or other  instruments  for the payment of money, or
               incurred in  connection  with the  acquisition  of any  property,
               services or assets  (whether or not the recourse of the lender is
               to the whole of the  assets  of such  Person or to only a portion
               thereof), other than any account payable or other accrued current
               liability  or  obligation  to  trade  creditors  incurred  in the
               ordinary  course of business in connection  with the obtaining of
               materials or services;

          (2)  all reimbursement  obligations and other liabilities  (contingent
               or  otherwise)  of that Person with respect to letters of credit,
               bank guarantees,  bankers' acceptances, surety bonds, performance
               bonds or other guaranty of contractual performance;

          (3)  all  obligations  and  liabilities  (contingent  or otherwise) in
               respect of (A) leases of such Person required, in conformity with
               generally accepted accounting principles,  to be accounted for as
               capitalized  lease  obligations  on the  balance  sheet  of  such
               Person,  and (B) any  lease or  related  documents  (including  a
               purchase agreement) in connection with the lease of real property
               which  provides  that such Person is  contractually  obligated to
               purchase or cause a third party to purchase  the leased  property
               and  thereby  guarantee  a minimum  residual  value of the leased
               property to the landlord and the obligations of such Person under
               such lease or related  document  to  purchase or to cause a third
               party to purchase the leased property;

          (4)  all  obligations of such Person  (contingent  or otherwise)  with
               respect  to an  interest  rate  or  other  swap,  cap  or  collar
               agreement  or other  similar  instrument  or agreement or foreign
               currency  hedge,  exchange,  purchase  or similar  instrument  or
               agreement;

          (5)  all direct or indirect  guaranties or similar  agreements by that
               Person in respect of, and obligations or liabilities  (contingent
               or otherwise) of that Person to purchase or otherwise  acquire or
               otherwise   assure  a  creditor   against  loss  in  respect  of,
               indebtedness, obligations or liabilities of another Person of the
               kind described in clauses (1) through (4);

          (6)  any  indebtedness or other  obligations  described in clauses (1)
               through  (4)  secured  by any  mortgage,  pledge,  lien or  other
               encumbrance  existing on property  which is owned or held by such
               Person,   regardless  of  whether  the

                                       7

<PAGE>

               indebtedness or other obligation  secured thereby shall have been
               assumed by such Person; and

          (7)  any and all deferrals, renewals, extensions and refundings of, or
               amendments,  modifications  or supplements to, any  indebtedness,
               obligation  or  liability  of the kind  described  in clauses (1)
               through (6).

          "Indemnitees" has the meaning specified in Section 5.8.

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

          "Initial  Purchasers"  mean  Lehman  Brothers  Inc.,  Banc of  America
     Securities LLC, and First Union Securities, Inc.

          "Interest  Payment  Date"  means  June 1 and  December 1 of each year;
     provided,  however,  that if any  such  date  is not a  Business  Day,  the
     Interest Payment Date shall be the next succeeding Business Day.

          "Interest  Rate"  means,  (a)  prior to the  occurrence  of any  Reset
     Transaction,  6.50% per annum,  and (b) following the occurrence of a Reset
     Transaction,  the Adjusted  Interest Rate related to such Reset Transaction
     to,  but  not  including  the  effective  date  of  any  succeeding   Reset
     Transaction.

          "Internal  Revenue  Code" means the Internal  Revenue Code of 1986, as
     amended.

          "Maturity" means the date on which the principal of a Security becomes
     due and  payable  as  therein  or herein  provided,  whether  at the Stated
     Maturity or by acceleration, conversion, call for redemption, exercise of a
     Repurchase Right or otherwise.

          "Nasdaq National Market" means the National  Association of Securities
     Dealers  Automated  Quotation  National  Market or any  successor  national
     securities  exchange or automated  over-the-counter  trading  market in the
     United States.

          "Non-payment  Default" means, for purposes of Article Fourteen hereof,
     any default  (other than a Payment  Default) with respect to any Designated
     Senior Debt of the Company or the Guarantor  pursuant to which the maturity
     thereof may be accelerated.

          "Officer"  means,  with  respect to any  Person.  the  Chairman of the
     Board,  the President,  the Chief  Financial  Officer,  the Treasurer,  any
     Assistant  Treasurer,  any Vice  President,  the Secretary or any Assistant
     Secretary or any other officer designated by the Board of Directors serving
     in a similar capacity.

          "Officers'   Certificate"  means,  with  respect  to  the  Company,  a
     certificate  signed by both (1) the Chairman of the Board, the President or
     a Vice  President  and (2) so long as not the same as the  officer  signing
     pursuant to clause (1), the Chief  Financial  Officer,  the

                                       8

<PAGE>

     Treasurer,   any  Assistant  Treasurer,  the  Secretary  or  any  Assistant
     Secretary of the Company, and delivered to the Trustee.

          "Opinion of Counsel"  means a written  opinion of counsel,  who may be
     counsel to the  Company  (and may include  directors  or  employees  of the
     Company).

          "Outstanding",  when used with respect to Securities, means, as of the
     date  of  determination,   all  Securities  theretofore  authenticated  and
     delivered under this Indenture, except Securities:

               (6)  previously  canceled  by the  Trustee  or  delivered  to the
          Trustee for cancellation;

               (7) for the payment or redemption of which money in the necessary
          amount has been  previously  deposited  with the Trustee or any Paying
          Agent (other than the Company) in trust or set aside and segregated in
          trust by the  Company  (if the  Company  shall  act as its own  Paying
          Agent) for the Holders of such Securities;  provided, however, that if
          such Securities are to be redeemed, notice of such redemption has been
          duly given pursuant to this Indenture;

               (8) in  exchange  for or in lieu of which other  Securities  have
          been  authenticated  and delivered  pursuant to this Indenture,  other
          than any such  Securities  in respect of which  there  shall have been
          presented to the Trustee proof satisfactory to it that such Securities
          are held by a bona fide  purchaser in whose hands such  Securities are
          valid obligations of the Company; and

               (4) converted into Common Shares in accordance with Section 12.2.

     provided, however, that in determining whether the Holders of the requisite
     principal  amount of  Outstanding  Securities  are  present at a meeting of
     Holders of Securities for quorum  purposes or have consented to or voted in
     favor of any request, demand,  authorization,  direction,  notice, consent,
     waiver,  amendment  or  modification  hereunder,  Securities  held  for the
     account of the Company or of any of its affiliates shall be disregarded and
     deemed  not to be  Outstanding,  except  that in  determining  whether  the
     Trustee shall be protected in making such a  determination  or relying upon
     any such  quorum,  consent or vote,  only  Securities  which a  Responsible
     Officer  of  the  Trustee  actually  knows  to  be  so  owned  shall  be so
     disregarded.  Securities  so owned that have been pledged in good faith may
     be regarded as Outstanding if the pledgee  establishes to the  satisfaction
     of  the  Trustee  the  pledgee's  right  so to act  with  respect  to  such
     Securities  and that the pledgee is not the Company or any Affiliate of the
     Company.

          "Paying Agent" has the meaning specified in Section 2.5.

          "Payment  Default"  means any default in the payment when due (whether
     at Stated Maturity,  by acceleration or otherwise) of principal or interest
     on,  or of  unreimbursed  amounts  under  drawn  letters  of credit or fees
     relating to letters of credit  constituting,  any Senior Debt or  Guarantor
     Senior Debt, as applicable, of the Company or the Guarantor.

                                       9

<PAGE>

          "Person"  means  any  individual,   corporation,   partnership,  joint
     venture, joint-stock company, trust, estate, unincorporated organization or
     government or any agency or political subdivision thereof.

          "Physical  Securities"  means Securities  issued in definitive,  fully
     registered  form without  interest  coupons,  substantially  in the form of
     Exhibit A hereto, with the applicable legends as provided in Section 2.3.

          "Place of Conversion"  means any city in which any Conversion Agent is
     located.

          "Place  of  Payment"  means  any city in  which  any  Paying  Agent is
     located.

          "Predecessor Security" of any particular Security means every previous
     Security  evidencing all or a portion of the same debt as that evidenced by
     such particular  Security;  and, for the purposes of this  definition,  any
     Security  authenticated and delivered under Section 2.12 in exchange for or
     in lieu of a mutilated,  destroyed, lost or stolen Security shall be deemed
     to  evidence  the same  debt as the  mutilated,  destroyed,  lost or stolen
     Security.

          "Purchase Agreement" means the Purchase Agreement, dated as of May 22,
     2001, between the Company and the Initial Purchasers.

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

          "Record Date" means either a Regular  Record Date or a Special  Record
     Date,  as the case may be;  provided  that,  for purposes of Section  12.4,
     Record Date has the meaning specified in 12.4(g).

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

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

          "Reference   Dealer"  means  a  dealer   engaged  in  the  trading  of
     convertible securities.

          "Reference Period" has the meaning set forth in Section 12.4(d).

          "Register" has the meaning specified in Section 2.5.

          "Registrar" has the meaning specified in Section 2.5.

          "Registration   Rights   Agreement"  means  the  Registration   Rights
     Agreement  dated as of May 31, 2001,  among the Company,  the Guarantor and
     the Initial Purchasers.

          "Regular  Record Date" for the interest on the  Securities  (including
     Additional  Amounts,  if any)  payable  means the May 15  (whether or not a
     Business Day) next

                                       10

<PAGE>

     preceding  an  Interest  Payment  Date on the  June 1 and the  November  15
     (whether or not a Business Day) next preceding an Interest  Payment Date on
     December 1.

          "Regulation S" means  Regulation S under the Securities Act (including
     any successor regulation thereof),  as the same may be amended from time to
     time.

          "Repurchase Date" has the meaning specified in Section 11.1.

          "Repurchase Price" has the meaning specified in Section 11.1.

          "Repurchase Right" has the meaning specified in Section 11.7.

          "Reset  Transaction" means a merger,  consolidation or statutory share
     exchange to which the issuer of the shares of Common  Shares into which the
     Securities are then  convertible is a party, a sale of all or substantially
     all the assets of that entity, a recapitalization of those shares of Common
     Shares or a distribution  described in Section 12.4(d), after the effective
     date  of  which   transaction  or  distribution  the  Securities  would  be
     convertible into:

               (9) shares of an entity the common shares of which had a Dividend
          Yield  for  the  four  fiscal  quarters  of  such  entity  immediately
          preceding the public  announcement of such transaction or distribution
          that was more than 2.5  percentage  points  higher  then the  Dividend
          Yield on the Common Shares for the four fiscal quarters  preceding the
          public announcement of such transaction or distribution; or

               (10) shares of an entity that  announces a dividend  policy prior
          to the  effective  date  of such  transaction  or  distribution  which
          policy,  if  implemented,  would  result in a  Dividend  Yield on such
          entity's  Common  Shares for the next four fiscal  quarters that would
          result in such a 2.5 percentage points increase.

          "Responsible Officer" when used with respect to the Trustee, means any
     officer assigned by it to administer  corporate trust matters and who shall
     have the direct responsibility for the administration of this Indenture.

          "Restricted  Securities"  means  the  Securities  defined  as  such in
     Section 2.3.

          "Restricted  Securities  Legend"  has the meaning set forth in Section
     2.3.

          "Robbins Facility Debt" means Indebtedness of the Guarantor under that
     certain Exit Funding Agreement dated as of October 15, 1999.

          "Rule 144"  means Rule 144 under the  Securities  Act  (including  any
     successor rule thereof), as the same may be amended from time to time.

          "Rule 144A" means Rule 144A as  promulgated  under the  Securities Act
     (including  any successor  rule  thereof),  as the same may be amended from
     time to time.

                                       11

<PAGE>

          "SEC" means the Securities and Exchange Commission.

          "Securities"  has the meaning  ascribed  to it in the first  paragraph
     under the caption "Recitals of the Company".

          "Senior  Bank  Debt"  means  Indebtedness  of the  Company  under that
     certain Second Amended and Restated  Revolving Credit Agreement dated as of
     May 25, 2001, among Foster Wheeler  Corporation,  the Guarantors  signatory
     thereto,  the Lenders  signatory  thereto,  and Bank of America,  N.A.,  as
     administrative agent, as amended from time to time.

          "Senior  Debt"  means the  principal  of,  premium,  if any,  interest
     (including  all interest  accruing  subsequent to the  commencement  of any
     bankruptcy or similar  proceeding,  whether or not a claim for postpetition
     interest is allowable as a claim in any such  proceeding)  and rent payable
     on or  termination  payment with respect to or in connection  with, and all
     fees, costs,  expenses and other amounts accrued or due on or in connection
     with,  the  Indebtedness  of the  Company,  including  without  limitation,
     Indebtedness  under (i) its  guarantees in respect of the Senior Bank Debt;
     and (ii) its guarantee in respect of the Senior Notes,  whether outstanding
     on the date of this Indenture or subsequently created,  incurred,  assumed,
     guaranteed or in effect guaranteed by the Company (including all deferrals,
     renewals,  extensions or refundings  of, or  amendments,  modifications  or
     supplements  to,  the  foregoing),  unless  in the  case of any  particular
     Indebtedness,  the instrument  creating or evidencing such  Indebtedness or
     the   assumption  or  guarantee   thereof   expressly   provides  that  the
     Indebtedness  shall not be senior in right of payment to the  Securities or
     expressly  provides that such Indebtedness  ranks pari passu with or junior
     to the Securities. However, the term "Senior Debt" does not include (i) the
     Indebtedness  of  the  Company  to any of its  subsidiaries;  or  (ii)  any
     Indebtedness  of the  Company  which by its terms  ranks  junior to or pari
     passu with the Securities.

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

          "Shelf  Registration  Statement"  has  the  meaning  specified  in the
     Registration Rights Agreement.

          "Senior  Notes" means those  certain 6.75% Notes due November 15, 2005
     issued  pursuant to that certain  indenture,  dated as of November 15, 1995
     between Foster Wheeler Corporation and Harris Trust and Savings Bank.

          "Special Record Date" for the payment of any Defaulted  Interest means
     a date fixed by the Trustee pursuant to Section 2.17.

          "Stated  Maturity"  means the date  specified  in any  Security as the
     fixed date for the  payment of  principal  on such  Security or on which an
     installment  of interest  (including  Additional  Amounts,  if any) on such
     Security is due and payable.

                                       12

<PAGE>

          "Subsidiary"  means a  corporation  more  than 50% of the  outstanding
     voting stock of which is owned,  directly or indirectly,  by the Company or
     by one or more other Subsidiaries,  or by the Company and one or more other
     Subsidiaries.  For the purposes of this  definition  only,  "voting  stock"
     means  stock  which  ordinarily  has  voting  power  for  the  election  of
     directors, whether at all times or only so long as no senior class of stock
     has such voting power by reason of any contingency.

          "TIA" means the Trust  Indenture Act of 1939, as amended (15 U.S. Code
     Section  77aaa-77bbbb),  as in  effect  on  the  date  of  this  Indenture;
     provided,  however,  that in the event the TIA is amended  after such date,
     "TIA" means,  to the extent such amendment is applicable to this Indenture,
     the Trust Indenture Act of 1939, as so amended, or any successor statute.

          "Trading Day" means:

               (11) if the applicable security is listed or admitted for trading
          on the New York  Stock  Exchange,  a day on which  the New York  Stock
          Exchange is open for business;

               (12) if the  applicable  security is not listed or  admitted  for
          trading  on the New York  Stock  Exchange  but is quoted on the Nasdaq
          National  Market,  a day on  which  trades  may be made on the  Nasdaq
          National Market;

               (13) if the applicable  security is not so listed or admitted for
          trading  on the New York Stock  Exchange  and not quoted on the Nasdaq
          National Market, a day on which the principal U.S. securities exchange
          on which the securities are listed is open for business; or

               (14) if the  applicable  security is not so listed,  admitted for
          trading or quoted, any day other than a Saturday or Sunday or a day on
          which banking  institutions in the State of New York are authorized or
          obligated by law or executive order to close.

          "Trading Price" of a security on any date of determination means:

               (15) the  closing  sale  price (or,  if no closing  sale price is
          reported, the last reported sale price) of that security (regular way)
          on the New York Stock Exchange on that date;

               (16)  if that  security  is not  listed  on the  New  York  Stock
          Exchange on that date, the closing sale price as reported on that date
          in the  composite  transactions  for  the  principal  U.S.  securities
          exchange on which that security is listed;

               (17) if that  security  is not so  listed on a U.S.  national  or
          regional  securities  exchange,  the closing sale price as reported on
          that date by the Nasdaq National Market;

                                       13

<PAGE>

               (18) if that  security is not so reported,  the last price quoted
          by Interactive  Data Corporation for that security on that date or, if
          Interactive  Data  Corporation  is not quoting  such price,  a similar
          quotation service selected by the Company;

               (19)  if that  security  is not so  quoted,  the  average  of the
          mid-point  of the last bid and ask  prices for that  security  on that
          date from at least two dealers  recognized as  market-makers  for that
          security selected by the Company for this purpose; or

               (20) if that security is not so quoted,  the average of that last
          bid and ask  prices  for  that  security  on that  date  from a dealer
          engaged  in the  trading of  convertible  securities  selected  by the
          Company for this purpose.

          "Transfer  Agent"  means any  Person,  which may be the  Company  or a
     Subsidiary,  authorized by the Company to exchange or register the transfer
     of Securities.

          "Trigger Event" has the meaning specified in Section 12.4(d).

          "Trustee"  means  the  Person  named  as the  "Trustee"  in the  first
     paragraph of this Indenture,  not in its individual  capacity but solely as
     Trustee  hereunder,  until a  successor  Trustee  shall  have  become  such
     pursuant to the  applicable  provisions of this  Indenture,  and thereafter
     "Trustee" shall mean such successor Trustee.

          "U.S.  Government  Obligations"  means  securities that are (i) direct
     obligations  of the U.S. for the payment of which its full faith and credit
     is pledged or (ii) obligations of a Person  controlled or supervised by and
     acting as an agency or  instrumentality  of the U.S. the timely  payment of
     which is  unconditionally  guaranteed as a full faith and credit obligation
     by the U.S.,  that,  in  either  case  under  clause  (i) or (ii),  are not
     callable or redeemable at the option of the issuer thereof.

          "Vice  President",  when used with respect to the  Company,  means any
     vice  president,  whether or not  designated by a number or a word or words
     added before or after the title "vice president".

          Section  1.2  Incorporation  by  Reference  of  Trust  Indenture  Act.

          Whenever  this  Indenture  refers  to a  provision  of  the  TIA,  the
provision is incorporated by reference in and made a part of this Indenture.

          The  following  TIA terms used in this  Indenture  have the  following
meanings:

          "indenture securities" means the Securities;

          "indenture security holder" means a Holder;

          "indenture to be qualified" means this Indenture;

                                       14

<PAGE>

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

          "obligor" on the Securities means the Company.

          All other TIA terms  used in this  Indenture  that are  defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.

          Section 1.3 Rules of Construction.

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

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

          (2) all  accounting  terms  not  otherwise  defined  herein  have  the
     meanings  assigned  to  them  in  accordance  with  accounting   principles
     generally  accepted  in the  United  States  prevailing  at the time of any
     relevant computation hereunder; and

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

                                   Article II

                                 THE SECURITIES

     Section 2.1 Title and Terms.

          (a) The  Securities  shall  be  known  and  designated  as the  "6.50%
Convertible Subordinated Notes due 2007" of the Company. The aggregate principal
amount of  Securities  which  may be  authenticated  and  delivered  under  this
Indenture is limited to $240,000,000,  except for Securities  authenticated  and
delivered upon  registration  of, transfer of, or in exchange for, or in lieu of
other  Securities  pursuant to Section 2.7, 2.8, 2.9, 2.12,  7.5, 10.7,  11.1 or
Securities converted into Common Shares pursuant to Section 12.2. The Securities
shall be issuable in denominations of $1,000 or integral multiples thereof.

          (b) The  Securities  shall  mature  on June 1,  2007,  unless  earlier
redeemed at the option of the Company pursuant to Article 10, repurchased by the
Company at the option of the Holder  pursuant to Article 11 or  converted by the
Holder pursuant to Article 12.

          (c) Interest on the  Securities  shall accrue from May 31, 2001 at the
Interest  Rate until the principal of the  Securities is paid or made  available
for payment.  Interest shall be payable semiannually in arrears on each Interest
Payment Date.

                                       15

<PAGE>

          (d)  Interest on the  Securities  shall be  computed  (i) for any full
semi-annual  period for which a particular  Interest Rate is applicable,  on the
basis of a 360-day  year of twelve  30-day  months  and (ii) for any  period for
which a particular  Interest Rate is applicable for less than a full  semiannual
period for which interest is calculated, on the basis of a 30-day month and, for
such  periods of less than a month,  the actual  number of days  elapsed  over a
30-day month.  For purposes of  determining  the Interest  Rate, the Trustee may
assume that a Reset Transaction has not occurred unless the Trustee has received
an  Officers'  Certificate  stating  that a Reset  Transaction  has occurred and
specifying the Adjusted Interest Rate then in effect.

          (e) A Holder of any Security at the Registrar's close of business on a
Regular Record Date shall be entitled to receive interest (including  Additional
Amounts, if any) on such Security on the corresponding  Interest Payment Date. A
Holder of any  Security  which is  converted  after the close of  business  on a
Regular Record Date and prior to the corresponding  Interest Payment Date (other
than any Security whose  Maturity is prior to such Interest  Payment Date) shall
be entitled to receive interest  (including  Additional  Amounts, if any) on the
principal  amount  of such  Security,  notwithstanding  the  conversion  of such
Security  prior to such Interest  Payment Date.  However,  any such Holder which
surrenders any such Security for conversion  during the period  beginning at the
Registrar's  close of business on such  Regular  Record Date and ending with the
opening of business on the corresponding Interest Payment Date shall be required
to pay the  Company  an  amount  equal  to the  interest  (including  Additional
Amounts, if any) on the principal amount of such Security so converted, which is
payable by the Company to such Holder on such Interest Payment Date, at the time
such  Holder  surrenders  such  Security  for  conversion.  Notwithstanding  the
foregoing,  any such Holder which  surrenders  for conversion any Security which
has been called for redemption by the Company in a notice of redemption given by
the Company  pursuant to Section  10.4 shall be entitled to receive (and retain)
such  interest  (including  Additional  Amounts,  if any)  and  need not pay the
Company an amount equal to the interest  (including  Additional Amounts, if any)
on the  principal  amount of such  Security so converted at the time such Holder
surrenders such Security for conversion.

          (f)  Principal  of, and  premium,  if any,  and  interest  on,  Global
Securities shall be payable to the Depositary in immediately available funds.

          (g) Principal  and premium,  if any, on Physical  Securities  shall be
payable  at the office or agency of the  Company  maintained  for such  purpose,
initially  the  Corporate  Trust  Office  of the  Trustee.  Interest  (including
Additional  Amounts,  if any) on Physical Securities will be payable by (i) U.S.
Dollar  check  drawn on a bank in The City of New York  mailed to the address of
the Person  entitled  thereto as such address shall appear in the  Register,  or
(ii) upon  application to the Registrar not later than the relevant  Record Date
by a Holder  of an  aggregate  principal  amount  of  Securities  in  excess  of
$5,000,000,  wire transfer in immediately  available  funds,  which  application
shall remain in effect until the Holder notifies,  in writing,  the Registrar to
the contrary.

          (h) The Securities shall be redeemable at the option of the Company as
provided in Article 10.

          (i) The  Securities  shall be  repurchaseable  by the  Company  at the
option of Holders as provided in Article 11.

                                       16

<PAGE>

          (j) The  Securities  shall be convertible at the option of the Holders
as provided in Article 12.

     Section 2.2  Form of Securities.

          (a) Except as  otherwise  provided  pursuant to this  Section 2.2, the
Securities   are  issuable  in  fully   registered   form  without   coupons  in
substantially the form of Exhibit A hereto,  with such applicable legends as are
provided for in Section 2.3. The Securities are not issuable in bearer form. The
terms and provisions contained in the form of Security shall constitute, and are
hereby  expressly  made, a part of this Indenture and to the extent  applicable,
the Company and the Trustee,  by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby. Any of the
Securities may have such letters,  numbers or other marks of identification  and
such notations,  legends and endorsements as the officers executing the same may
approve  (execution  thereof to be conclusive  evidence of such approval) and as
are  not  inconsistent  with  the  provisions  of this  Indenture,  or as may be
required to comply  with any law or with any rule or  regulation  made  pursuant
thereto or with any rule or regulation of any  securities  exchange or automated
quotation  system  on which the  Securities  may be  listed  or  designated  for
issuance, or to conform to usage.

          (b) The Securities are being offered and sold by the Company  pursuant
to the Purchase Agreement. Securities offered and sold (i) to QIBs in accordance
with Rule 144A and (ii) in  reliance  on  Regulation  S, each as provided in the
Purchase  Agreement,  shall  be  issued  initially  in the  form  of one or more
permanent global  Securities in fully registered form without interest  coupons,
substantially  in the form of Exhibit A hereto,  with the applicable  legends as
provided in Section 2.3 (each a "Global  Security" and  collectively the "Global
Securities").  Each Global  Security  shall be duly  executed by the Company and
authenticated and delivered by the Trustee,  and shall be registered in the name
of the Depositary or its nominee and retained by the Trustee,  as Custodian,  at
its  Corporate  Trust  Office,  for credit to the accounts of the Agent  Members
holding the Securities  evidenced thereby (or in the case of Securities held for
purchasers  who acquired  such  Securities  in  accordance  with  Regulation  S,
registered  with the  Depositary for credit to the accounts of the Agent Members
then holding such Securities on behalf of Euroclear or Clearstream,  as the case
may be). The aggregate  principal amount of the Global  Securities may from time
to time be  increased or  decreased  by  adjustments  made on the records of the
Trustee,  as Custodian,  and of the  Depositary or its nominee,  as  hereinafter
provided.

          Physical  Securities  acquired by QIBs in accordance with Rule 144A or
in reliance on Regulation S may be exchanged for interests in Global  Securities
pursuant to Section 2.9(a).

     Section 2.3  Legends.

          (a) Restricted Securities Legends.

          Each Security issued hereunder shall,  upon issuance,  bear the legend
set forth in Section 2.3(a)(i),  and each certificate representing Common Shares
issued upon conversion of any Security issued  hereunder,  shall, upon issuance,
bear the legend set forth in Section 2.3(a)(ii) (each such legend, a "Restricted
Securities Legend"),  and such legend shall not be removed

                                       17

<PAGE>

except as  provided  in  Section  2.3(a)(iii).  Each  Security  that bears or is
required to bear the Restricted Securities Legend set forth in Section 2.3(a)(i)
(together  with  each  certificate   representing   Common  Shares  issued  upon
conversion  of such  Security  that bears or is required to bear the  Restricted
Securities Legend set forth in Section 2.3(a)(ii), collectively, the "Restricted
Securities")  shall be subject to the restrictions on transfer set forth in this
Section 2.3(a) (including the Restricted Securities Legend set forth below), and
the  Holder  of each  such  Restricted  Security,  by such  Holder's  acceptance
thereof,  shall be deemed to have agreed to be bound by all such restrictions on
transfer.

          As used in Section 2.3(a),  the term "transfer"  encompasses any sale,
pledge, transfer or other disposition whatsoever of any Restricted Security.

          (i) Restricted Securities Legend for Securities.

          Except as provided in Section  2.3(a)(iii),  until two years after the
original issuance date of any Security, any certificate evidencing such Security
(and all Securities issued in exchange therefor or substitution  thereof,  other
than  certificates  representing  Common Shares,  if any, issued upon conversion
thereof  which  shall  bear the  legend  set  forth in  Section  2.3(a)(ii),  if
applicable)  shall bear a  Restricted  Securities  Legend in  substantially  the
following form:

          THE SECURITY  EVIDENCED BY THIS  CERTIFICATE  HAS NOT BEEN  REGISTERED
     UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
     STATE  SECURITIES  LAWS,  AND MAY NOT BE OFFERED OR SOLD  WITHIN THE UNITED
     STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.  PERSONS EXCEPT AS SET
     FORTH IN THE FOLLOWING SENTENCE.  BY ACQUISITION HEREOF, THE HOLDER (1) (A)
     REPRESENTS THAT IT IS A "QUALIFIED  INSTITUTIONAL BUYER" AS DEFINED IN RULE
     144A  UNDER  THE  SECURITIES  ACT OR (B)  REPRESENTS  THAT IT IS NOT A U.S.
     PERSON  AND IS  OUTSIDE  THE UNITED  STATES  WITHIN  THE  MEANING OF (OR AN
     ACCOUNT  SATISFYING THE  REQUIREMENTS  OF) PARAGRAPH  (K)(2) OF RULE 902 OF
     REGULATION S UNDER THE  SECURITIES  ACT; (2) AGREES THAT IT WILL NOT WITHIN
     TWO YEARS AFTER THE ORIGINAL  ISSUANCE OF THIS SECURITY RESELL OR OTHERWISE
     TRANSFER THE SECURITY  EVIDENCED  HEREBY OR THE COMMON SHARES ISSUABLE UPON
     CONVERSION  OF SUCH  SECURITY  EXCEPT  (A) TO FOSTER  WHEELER  LTD.  OR ANY
     SUBSIDIARY  THEREOF,  (B) TO A QUALIFIED  INSTITUTIONAL BUYER IN COMPLIANCE
     WITH RULE 144A UNDER THE SECURITIES ACT, (C) IN AN OFFSHORE  TRANSACTION IN
     ACCORDANCE  WITH RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES  ACT,
     (D) PURSUANT TO THE EXEMPTION FROM REGISTRATION  PROVIDED BY RULE 144 UNDER
     THE  SECURITIES  ACT  (IF  AVAILABLE)  OR (E)  PURSUANT  TO A  REGISTRATION
     STATEMENT  WHICH HAS BEEN DECLARED  EFFECTIVE  UNDER THE SECURITIES ACT AND
     WHICH  CONTINUES  TO BE  EFFECTIVE  AT THE TIME OF SUCH  TRANSFER;  AND (3)
     AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE  SECURITY  EVIDENCED
     HEREBY IS TRANSFERRED (OTHER THAN A

                                       18

<PAGE>

     TRANSFER  PURSUANT  TO CLAUSE  2(D)  ABOVE) A NOTICE  SUBSTANTIALLY  TO THE
     EFFECT OF THIS  LEGEND.  IN  CONNECTION  WITH ANY  TRANSFER OF THE SECURITY
     EVIDENCED  HEREBY  WITHIN TWO YEARS  AFTER THE  ORIGINAL  ISSUANCE  OF SUCH
     SECURITY (OTHER THAN A TRANSFER PURSUANT TO CLAUSE 2(D) ABOVE),  THE HOLDER
     MUST CHECK THE  APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO
     THE MANNER OF SUCH TRANSFER AND SUBMIT THIS  CERTIFICATE TO THE TRUSTEE (OR
     ANY SUCCESSOR TRUSTEE, AS APPLICABLE). IF THE PROPOSED TRANSFER IS PURSUANT
     TO CLAUSE 2(C) ABOVE, THE HOLDER MUST,  PRIOR TO SUCH TRANSFER,  FURNISH TO
     THE TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE) SUCH  CERTIFICATIONS,
     LEGAL  OPINIONS OR OTHER  INFORMATION AS FOSTER WHEELER LTD. MAY REASONABLY
     REQUIRE  TO  CONFIRM  THAT  SUCH  TRANSFER  IS BEING  MADE  PURSUANT  TO AN
     EXEMPTION  FROM,  OR IN A  TRANSACTION  NOT  SUBJECT  TO, THE  REGISTRATION
     REQUIREMENTS  OF THE  SECURITIES  ACT. THIS LEGEND WILL BE REMOVED UPON THE
     EARLIER OF THE TRANSFER OF THE SECURITY EVIDENCED HEREBY PURSUANT TO CLAUSE
     2(D) ABOVE OR THE EXPIRATION OF TWO YEARS FROM THE ORIGINAL ISSUANCE OF THE
     SECURITY  EVIDENCED HEREBY.  AS USED HEREIN,  THE TERMS "UNITED STATES" AND
     "U.S.  PERSON"  HAVE THE MEANINGS  GIVEN TO THEM BY  REGULATION S UNDER THE
     SECURITIES ACT.

         (ii) Restricted   Securities  Legend  for  Common  Shares  Issued  Upon
     Conversion of the Securities.

          Until two years after the original issuance date of any Security, each
certificate  representing  Common Shares issued upon conversion of such Security
shall bear a Restricted Securities Legend in substantially the following form:

          THE  SECURITY  EVIDENCED  HEREBY  HAS NOT BEEN  REGISTERED  UNDER  THE
     SECURITIES  ACT OF 1933, AS AMENDED (THE  "SECURITIES  ACT"),  OR ANY STATE
     SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR
     TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.  PERSONS  EXCEPT AS SET FORTH IN
     THE FOLLOWING SENTENCE.  THE HOLDER HEREOF AGREES THAT UNTIL THE EXPIRATION
     OF TWO  YEARS  AFTER  THE  ORIGINAL  ISSUANCE  OF  THE  SECURITY  UPON  THE
     CONVERSION OF WHICH THE COMMON SHARES EVIDENCED  HEREBY WAS ISSUED,  (1) IT
     WILL NOT RESELL OR OTHERWISE  TRANSFER  THE  SECURITY  EXCEPT (A) TO FOSTER
     WHEELER LTD. OR ANY SUBSIDIARY THEREOF,  (B) PURSUANT TO THE EXEMPTION FROM
     REGISTRATION  PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE),
     (C) IN AN  OFFSHORE  TRANSACTION  IN  ACCORDANCE  WITH  RULE  903

                                       19

<PAGE>

     OR 904 OF  REGULATION  S UNDER  THE  SECURITIES  ACT OR (D)  PURSUANT  TO A
     REGISTRATION   STATEMENT  WHICH  HAS  BEEN  DECLARED  EFFECTIVE  UNDER  THE
     SECURITIES  ACT AND WHICH  CONTINUES  TO BE  EFFECTIVE  AT THE TIME OF SUCH
     TRANSFER;  (2) PRIOR TO ANY SUCH TRANSFER OTHER THAN A TRANSFER PURSUANT TO
     CLAUSE l(C) ABOVE, IT WILL FURNISH TO SUCH TRANSFER AGENT (OR ANY SUCCESSOR
     TRANSFER AGENT, AS APPLICABLE) SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER
     INFORMATION AS FOSTER  WHEELER LTD. MAY REASONABLY  REQUIRE TO CONFIRM THAT
     SUCH  TRANSFER  IS  BEING  MADE  PURSUANT  TO AN  EXEMPTION  FROM,  OR IN A
     TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
     ACT;  AND (3) IT WILL  DELIVER  TO EACH  PERSON TO WHOM THE  COMMON  SHARES
     EVIDENCED HEREBY IS TRANSFERRED  (OTHER THAN A TRANSFER  PURSUANT TO CLAUSE
     1(C)  ABOVE) A NOTICE  SUBSTANTIALLY  TO THE  EFFECT OF THIS  LEGEND.  THIS
     LEGEND  WILL BE  REMOVED  UPON THE  EARLIER OF THE  TRANSFER  OF THE COMMON
     SHARES  EVIDENCED HEREBY PURSUANT TO CLAUSE 1(C) ABOVE OR THE EXPIRATION OF
     TWO YEARS FROM THE ORIGINAL ISSUANCE OF THE SECURITY UPON THE CONVERSION OF
     WHICH THE COMMON SHARES  EVIDENCED HEREBY WAS ISSUED.  AS USED HEREIN,  THE
     TERMS "UNITED STATES" AND "U.S.  PERSON" HAVE THE MEANINGS GIVEN TO THEM BY
     REGULATION S UNDER THE SECURITIES ACT.

     IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY WITHIN TWO
     YEARS AFTER THE ORIGINAL  ISSUANCE OF SUCH SECURITY  (OTHER THAN A TRANSFER
     PURSUANT TO CLAUSE (2)(E) ABOVE), THE HOLDER MUST CHECK THE APPROPRIATE BOX
     SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND
     SUBMIT  THIS  CERTIFICATE  TO THE  TRUSTEE (OR ANY  SUCCESSOR  TRUSTEE,  AS
     APPLICABLE).  IF THE  PROPOSED  TRANSFER IS PURSUANT TO CLAUSE 2(C) OR 2(D)
     ABOVE, THE HOLDER MUST, PRIOR TO SUCH TRANSFER,  FURNISH TO THE TRUSTEE (OR
     ANY SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH CERTIFICATIONS,  LEGAL OPINIONS
     OR OTHER INFORMATION AS THE COMPANY MAY REASONABLY  REQUIRE TO CONFIRM THAT
     SUCH  TRANSFER  IS  BEING  MADE  PURSUANT  TO AN  EXEMPTION  FROM,  OR IN A
     TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
     ACT.

     THIS  LEGEND  WILL BE  REMOVED  UPON THE  EARLIER  OF THE  TRANSFER  OF THE
     SECURITY EVIDENCED HEREBY PURSUANT TO CLAUSE (2)(E) ABOVE OR THE EXPIRATION
     OF TWO YEARS FROM THE ORIGINAL  ISSUANCE OF THE SECURITY  EVIDENCED HEREBY.
     AS USED  HEREIN,  THE TERMS  "UNITED  STATES"  AND "U.S.  PERSON"  HAVE THE

                                       20

<PAGE>

     MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT."

          (iii) Removal of the Restricted Securities Legends.

          Each Security and certificate  representing  Common Shares issued upon
conversion of any Security (other than a certificate  representing Common Shares
issued upon conversion of a Security that previously has been sold pursuant to a
registration statement that has been declared effective under the Securities Act
and which  continues  to be  effective  at the time of such sale) shall bear the
applicable  Restricted  Securities  Legend  set forth in  Section  2.3(a)(i)  or
2.3(a)(ii), as the case may be, until the earlier of:

               (1) the date which is two years after the original  issuance date
          of such Security; and

               (2) the date such  Security or such  Common  Shares has been sold
          pursuant to a registration  statement that has been declared effective
          under the Securities  Act (and which  continues to be effective at the
          time of such sale).

The Holder must give notice  thereof to the  Trustee or any  Depositary  for the
Common Shares, as applicable.

          In the event Rule 144(k) as  promulgated  under the  Securities Act is
amended to shorten the two-year  period under Rule 144(k),  then, the references
in  the  restrictive  legends  set  forth  above  to  "TWO  YEARS",  and  in the
corresponding  transfer  restrictions  described  above,  the Securities and the
Common  Shares will be deemed to refer to such  shorter  period,  from and after
receipt  by the  Trustee  of both an  Officers'  Certificate  and an  Opinion of
Counsel  in  accordance  with the  sentence  immediately  following.  As soon as
practicable  after the Company knows of the  effectiveness of any such amendment
to shorten the  two-year  period under Rule  144(k),  unless such changes  would
otherwise  be  prohibited  by,  or  would  cause a  violation  of,  the  federal
securities  laws applicable at the time, the Company will provide to the Trustee
an Officers'  Certificate and an Opinion of Counsel as to the  effectiveness  of
such amendment and the  effectiveness of such change to the restrictive  legends
and transfer restrictions.

          Notwithstanding the foregoing, the Restricted Securities Legend may be
removed from any Security or any certificate  representing  Common Shares issued
upon  conversion  of any  Security if there is  delivered  to the  Company  such
satisfactory  evidence,  which may include an opinion of independent counsel, as
may be  reasonably  required by the  Company,  that  neither such legend nor the
restrictions on transfer set forth therein are required to ensure that transfers
of such Security or Common Shares issued upon  conversion of Securities,  as the
case may be, will not violate the  registration  requirements  of the Securities
Act. Upon provision of such satisfactory  evidence,  at the written direction of
the Company,  (i) in the case of a Security,  the Trustee shall authenticate and
deliver in exchange for such Security another  Security or Securities  having an
equal aggregate  principal  amount that does not bear such legend or (ii) in the
case of a certificate  representing  Common Shares, the Company's transfer agent
for  the  Common  Shares  shall  deliver  in  exchange  for the  certificate  or
certificates  representing  such Common Shares bearing such

                                       21

<PAGE>

legend,  one or more new  certificates  representing a like aggregate  number of
shares  of  Common  Shares  that do not  bear  such  legend.  If the  Restricted
Securities Legend has been removed from a Security or certificates  representing
Common Shares issued upon conversion of any Security as provided above, no other
Security issued in exchange for all or any part of such Security or certificates
representing  Common Shares issued upon  conversion of such Security  shall bear
such legend,  unless the Company has reasonable cause to believe that such other
Security is a  "restricted  security"  (or such Common  Shares is a  "restricted
security")  within the meaning of Rule 144 or  Regulation  S and  instructs  the
Trustee in writing to cause a Restricted Securities Legend to appear thereon.

          Any Security (or Security issued in exchange or substitution therefor)
as to which such  restrictions on transfer shall have expired in accordance with
their  terms  or as to  which  the  conditions  for  removal  of the  Restricted
Securities  Legend set forth in Section 2.3(a)(i) as set forth therein have been
satisfied  may, upon surrender of such Security for exchange to the Registrar in
accordance  with the  provisions of Section 2.7, be exchanged for a new Security
or Securities,  of like tenor and aggregate  principal  amount,  which shall not
bear the Restricted Securities Legend required by Section 2.3(a)(i).

          Any certificate  representing  Common Shares issued upon conversion of
any  Security as to which such  restrictions  on transfer  shall have expired in
accordance  with their  terms or as to which the  conditions  for removal of the
Restricted  Securities  Legend  set  forth in  Section  2.3(a)(ii)  as set forth
therein have been satisfied may, upon surrender of the certificates representing
such  Common  Shares for  exchange  in  accordance  with the  procedures  of the
Company's  transfer  agent  for  the  Common  Shares,  be  exchanged  for  a new
certificate or  certificates  representing a like aggregate  number of shares of
Common Shares, which shall not bear the Restricted Securities Legend required by
Section 2.3(a)(ii).

          (b) Global Security Legend.

          Each Global Security shall also bear the following  legend on the face
thereof:

THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE  REFERRED
TO HEREIN.  BENEFICIAL  INTERESTS IN THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED
EXCEPT IN ACCORDANCE WITH THE INDENTURE.

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

                                       22

<PAGE>

IN AS MUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

     Section  2.4  Execution,  Authentication,   Delivery  and  Dating  of  the
Securities.

          An Officer of the Company  shall  execute the  Securities on behalf of
the Company by manual or facsimile signature.  If the Officer whose signature is
on a  Security  no  longer  holds  that  office  at the  time  the  Security  is
authenticated, the Security shall be valid nevertheless.

          At any time and from time to time after the  execution and delivery of
this Indenture,  the Company may deliver  Securities  executed by the Company to
the  Trustee  for  authentication,   together  with  a  Company  Order  for  the
authentication  and delivery of such  Securities,  and the Trustee in accordance
with such Company  Order shall  authenticate  and deliver such  Securities as in
this Indenture provided and not otherwise.

          Each Security shall be dated the date of its authentication.

          No Security shall be entitled to any benefit under this Indenture,  or
be valid or obligatory for any purpose,  unless there appears on such Security a
certificate  of  authentication  substantially  in the form  provided for herein
executed  by or  on  behalf  of  the  Trustee  by  manual  signature,  and  such
certificate  upon  any  Security  shall  be  conclusive  evidence,  and the only
evidence,   that  such  Security  has  been  duly  authenticated  and  delivered
hereunder.

          The Trustee may appoint an  authenticating  agent or agents reasonably
acceptable to the Company with respect to the Securities.  Unless limited by the
terms of such appointment,  an authenticating agent may authenticate  Securities
whenever  the  Trustee  may  do  so.  Each   reference  in  this   Indenture  to
authentication by the Trustee includes authentication by such agent.

     Section 2.5 Registrar and Paying Agent.

          The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange (the  "Registrar") and an
office or agency  where  Securities  may be  presented  for payment (the "Paying
Agent").  The Registrar shall keep a register of the Securities (the "Register")
and of  their  transfer  and  exchange.  The  Company  may  appoint  one or more
co-Registrars and one or more additional  Paying Agents for the Securities.  The
term  "Paying  Agent"  includes  any  additional   paying  agent  and  the  term
"Registrar" includes any additional registrar. The Company may change any Paying
Agent or Registrar without prior notice to any Holder.

          The Company  will cause each Paying  Agent (other than the Trustee) to
execute  and  deliver to the Trustee an  instrument  in which such Paying  Agent
shall agree with the Trustee,  subject to the  provisions of this Section,  that
such Paying Agent will:

               (1) hold all sums held by it for the payment of the  principal of
          and premium,  if any, or interest  (including  Additional  Amounts, if
          any) on  Securities  in trust for the benefit of the Persons  entitled
          thereto  until  such sums shall be paid to such  Persons or  otherwise
          disposed of as provided in this Indenture;

                                       23

<PAGE>

               (2) give the Trustee  notice of any Default by the Company in the
          making of any payment of principal  and  premium,  if any, or interest
          (including Additional Amounts, if any); and

               (3) at any time during the continuance of any such Default,  upon
          the written  request of the Trustee,  forthwith pay to the Trustee all
          sums so held in trust by such Paying Agent.

          The  Company  shall give prompt  written  notice to the Trustee of the
name and  address  of any  Agent  who is not a party to this  Indenture.  If the
Company  fails to appoint or  maintain  another  entity as  Registrar  or Paying
Agent,  the  Trustee  shall act as such.  The  Company or any  Affiliate  of the
Company may act as Paying Agent or Registrar;  provided,  however,  that none of
the Company, its subsidiaries or the Affiliates of the foregoing shall act:

               (4) as Paying Agent in  connection  with  redemptions,  offers to
          purchase  and  discharges,  except  as  otherwise  specified  in  this
          Indenture, and

               (5) as Paying Agent or Registrar if a Default or Event of Default
          has occurred and is continuing.

          The Company  hereby  initially  appoints the Trustee as Registrar  and
Paying Agent for the Securities.

     Section 2.6 Paying Agent to Hold Assets in Trust.

          Not later than 10:00 a.m. (New York City time) on each due date of the
principal,  premium, if any, and interest (including Additional Amounts, if any)
on any  Securities,  the Company  shall  deposit with one or more Paying  Agents
money in immediately  available funds in an aggregate  amount  sufficient to pay
the principal,  premium, if any, and interest (including  Additional Amounts, if
any) due on such date. The Company at any time may require a Paying Agent to pay
all money held by it to the  Trustee.  Upon  payment  over to the  Trustee,  the
Paying Agent (if other than the Company) shall have no further liability for the
money so paid over to the Trustee.

          If the Company shall act as a Paying Agent,  it shall,  prior to or on
each due date of the  principal of and premium,  if any, or interest  (including
Additional  Amounts,  if any) on any of the  Securities,  segregate  and hold in
trust for the  benefit of the Holders a sum  sufficient  with monies held by all
other Paying  Agents,  to pay the  principal  and  premium,  if any, or interest
(including  Additional Amounts, if any) so becoming due until such sums shall be
paid to such Persons or otherwise disposed of as provided in this Indenture, and
shall promptly notify the Trustee of its action or failure to act.

     Section 2.7 General Provisions Relating to Transfer and Exchange.

          The  Securities  are issuable  only in  registered  form. A Holder may
transfer a Security only by written  application  to the  Registrar  stating the
name of the proposed  transferee and otherwise  complying with the terms of this
Indenture.  No such transfer shall be effected until,

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<PAGE>

and such  transferee  shall  succeed to the rights of a Holder only upon,  final
acceptance  and  registration  of the transfer by the Registrar in the Register.
Furthermore, any Holder of a Global Security shall, by acceptance of such Global
Security,  agree that transfers of beneficial  interests in such Global Security
may be effected  only through a book-entry  system  maintained  by the Holder of
such Global Security (or its agent) and that ownership of a beneficial  interest
in the Global  Security  shall be  required  to be  reflected  in a  book-entry.
Notwithstanding  the  foregoing,  in  the  case  of  a  Restricted  Security,  a
beneficial  interest in a Global  Security  being  transferred in reliance on an
exemption from the registration requirements of the Securities Act other than in
accordance with Rule 144,  Regulation S or Rule 144A may be transferred only for
a Physical Security.

          When  Securities  are  presented  to the  Registrar  with a request to
register  the  transfer or to  exchange  them for an equal  aggregate  principal
amount of  Securities of other  authorized  denominations,  the Registrar  shall
register the  transfer or make the  exchange as  requested  if the  requirements
hereunder for such transactions are met (including that such Securities are duly
endorsed or accompanied by a written instrument of transfer duly executed by the
Holder  thereof or by an attorney who is  authorized in writing to act on behalf
of the Holder). Subject to Section 2.4, to permit registrations of transfers and
exchanges,  the  Company  shall  execute  and  the  Trustee  shall  authenticate
Securities at the Registrar's  request.  No service charge shall be made for any
registration  of transfer or exchange or redemption of the  Securities,  but the
Company may require  payment of a sum  sufficient  to cover any  transfer tax or
similar governmental charge payable in connection therewith (other than any such
transfer  taxes or other  similar  governmental  charge  payable upon  exchanges
pursuant to Section 2.14, 7.5 or 10.7).

          Neither the Company nor the Registrar shall be required to exchange or
register a transfer of any Securities:

               (1) for a  period  of 15  Business  Days  prior to the day of any
          selection of Securities for redemption under Article 10;

               (2) so selected for  redemption  or, if a portion of any Security
          is  selected  for  redemption,   the  portion  thereof   selected  for
          redemption; or

               (3)  surrendered  for conversion or, if a portion of any Security
          is surrendered  for conversion,  the portion  thereof  surrendered for
          conversion.

          The Trustee shall have no obligation or duty to monitor,  determine or
inquire as to compliance with any  restrictions  on transfer  imposed under this
Indenture or under  applicable  law with respect to any transfer of any interest
in any  Security  (including  any  transfers  between or among Agent  Members or
beneficial  owners of  interests in any Global  Security)  other than to require
delivery  of such  certificates  and  other  documentation  or  evidence  as are
expressly  required by, and to do so if and when expressly required by the terms
of, this Indenture,  and to examine the same to determine substantial compliance
as to form with the express requirements hereof.

     Section 2.8  Book-Entry Provisions for the Global Securities.

          (a) The Global Securities initially shall:

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<PAGE>

               (1) be  registered  in the name of the  Depositary  (or a nominee
          thereof);

               (2) be delivered to the Trustee as custodian for such Depositary;
          and

               (3) bear the  Restricted  Securities  Legend set forth in Section
          2.3(a)(i).

          Members of, or participants in, the Depositary ("Agent Members") shall
have no rights under this Indenture with respect to any Global  Security held on
their behalf by the Depositary,  or the Trustee as its custodian,  or under such
Global Security,  and the Depositary may be treated by the Company,  the Trustee
and any agent of the Company or the Trustee as the absolute owner of such Global
Security for all purposes  whatsoever.  Notwithstanding  the foregoing,  nothing
contained  herein  shall  prevent the  Company,  the Trustee or any agent of the
Company or Trustee  from giving  effect to any written  certification,  proxy or
other  authorization  furnished  by the  Depositary  or impair,  as between  the
Depositary and the Agent Members, the operation of customary practices governing
the  exercise  of the rights of a Holder of any  Security.  With  respect to any
Global  Security  deposited  on behalf  of the  subscribers  for the  Securities
represented  thereby with the Trustee as custodian for the Depositary for credit
to their  respective  accounts (or to such other accounts as they may direct) at
Euroclear or  Clearstream,  the provisions of the  "Operating  Procedures of the
Euroclear System" and the "Terms and Conditions  Governing Use of Euroclear" and
the "Management  Regulations" and "Instructions to Participants" of Clearstream,
respectively, shall be applicable to the Global Securities.

          (b) The Holder of a Global  Security may grant  proxies and  otherwise
authorize  any Person,  including  DTC  Participants  and Persons  that may hold
interests  through  DTC  Participants,  to take any  action  which a  Holder  is
entitled to take under this Indenture or the Securities.

          (c) A Global Security may not be transferred,  in whole or in part, to
any  Person  other  than the  Depositary  (or a  nominee  thereof),  and no such
transfer to any such other Person may be registered.  Beneficial  interests in a
Global  Security may be transferred in accordance  with the rules and procedures
of the Depositary and the provisions of Section 2.9.

          (d) If at any time:

               (1) the Depositary  notifies the Company in writing that it is no
          longer willing or able to continue to act as Depositary for the Global
          Securities,  or  the  Depositary  ceases  to  be a  "clearing  agency"
          registered  under the Exchange Act and a successor  depositary for the
          Global  Securities is not  appointed by the Company  within 90 days of
          such notice or cessation;

               (2) the Company,  at its option,  notifies the Trustee in writing
          that it elects to cause the issuance of the Physical  Securities under
          this  Indenture  in  exchange  for all or any  part of the  Securities
          represented by a Global Security or Global Securities; or

                                       26

<PAGE>

               (3) an Event of Default has  occurred and is  continuing  and the
          Registrar has received a request from the  Depositary for the issuance
          of Physical  Securities in exchange for such Global Security or Global
          Securities;

the Depositary shall surrender such Global Security or Global  Securities to the
Trustee for  cancellation and the Company shall execute,  and the Trustee,  upon
receipt of an Officers' Certificate and Company Order for the authentication and
delivery of  Securities,  shall  authenticate  and deliver in exchange  for such
Global  Security  or Global  Securities,  Physical  Securities  in an  aggregate
principal amount equal to the aggregate principal amount of such Global Security
or Global Securities. Such Physical Securities shall be registered in such names
as the  Depositary  shall  identify in writing as the  beneficial  owners of the
Securities  represented  by such Global  Security or Global  Securities  (or any
nominee thereof).

          (e) Notwithstanding the foregoing,  in connection with any transfer of
beneficial  interests  in a Global  Security to the  beneficial  owners  thereof
pursuant to Section 2.8(d), the Registrar shall reflect on its books and records
the date and a decrease in the  principal  amount of such Global  Security in an
amount equal to the principal amount of the beneficial  interests in such Global
Security to be transferred.

     Section 2.9  Special Transfer Provisions.

          Unless a Security is (i) transferred after the time period referred to
in Rule 144(k) under the  Securities Act or (ii) sold pursuant to a registration
statement that has been declared  effective  under the Securities Act (and which
continues to be effective at the time of such sale),  the  following  provisions
shall apply to any sale, pledge or other transfer of Securities:

          (a)  Transfer  of  Securities  to a QIB  or to a  Non-U.S.  Person  in
               Accordance with Regulation S.

          The following  provisions shall apply with respect to the registration
of any proposed transfer of Securities to (x) a QIB or (y) a Non-U.S.  Person in
Accordance with Regulation S:

          (i)  If the  Securities  to be  transferred  consist  of a  beneficial
     interest in the Global  Securities,  the  transfer of such  interest may be
     effected only through the  book-entry  systems  maintained by Euroclear and
     Clearstream, if applicable, and the Depositary.

          (ii)  If  the  Securities  to  be  transferred   consist  of  Physical
     Securities,  the Registrar  shall register the transfer if such transfer is
     being made by a proposed transferor who has checked the box provided for on
     the form of Security stating (or has otherwise  advised the Company and the
     Registrar in writing) that the sale has been made:

          (A) in compliance with the provisions of Rule 144A to a transferee who
     has signed the  certification  provided for on the form of Security stating
     or has otherwise advised the Company and the Registrar in writing that:

                                       27

<PAGE>

               (1) it is  purchasing  the  Securities  for its own account or an
          account with respect to which it exercises sole investment discretion,
          in each case for investment and not with a view to distribution;

               (2) it and any such  account is a QIB within the  meaning of Rule
          144A;

               (3) it is aware that the sale to it is being made in  reliance on
          Rule 144A;

               (4)  it  acknowledges  that  it  has  received  such  information
          regarding the Company as it has requested pursuant to Rule 144A or has
          determined not to request such information; and

               (5) it is aware that the transferor is relying upon its foregoing
          representations  in order to claim  the  exemption  from  registration
          provided by Rule 144A, or

          (B) in compliance  with  Regulation S to a transferee who has signed a
     certification  provided  for  on the  form  of  Security  stating  (or  has
     otherwise  advised the Company and the Registrar in writing) that it is not
     a "U.S. person" as defined in Regulation S.

          In addition,  the Registrar shall reflect on its books and records the
date and an  increase in the  principal  amount of the Global  Securities  in an
amount equal to the aggregate  principal amount of the Physical Securities to be
transferred,   and  the  Trustee   shall  cancel  the  Physical   Securities  so
transferred.

          (b)  Other Exchanges.

          In the event that Global  Securities  are exchanged for  Securities in
     definitive   registered   form   pursuant  to  Section  2.8  prior  to  the
     effectiveness  of a  Shelf  Registration  Statement  with  respect  to such
     Securities,  such  Securities may be exchanged only in accordance  with the
     provisions of clause (a) above  (including the  certification  requirements
     intended to ensure that such transfers  comply with Rule 144A or Regulation
     S, as the case may be) and such other  procedures  as may from time to time
     be adopted by the Company.

          (c)  General.

          By its acceptance of any Security  bearing the  Restricted  Securities
     Legend,  each Holder of such a Security  acknowledges  the  restrictions on
     transfer of such  Security set forth in this  Indenture  and agrees that it
     will  transfer  such  Security  only as  provided  in this  Indenture.  The
     Registrar  shall not  register  a  transfer  of any  Security  unless  such
     transfer  complies with the  restrictions  on transfer of such Security set
     forth in this  Indenture.  The  Registrar  shall be entitled to receive and
     conclusively  rely on written  instructions from the Company verifying that
     such transfer  complies with such  restrictions on transfer.  In connection
     with any transfer of  Securities,  each Holder agrees by its  acceptance of
     the Securities to furnish the Registrar or the Company such certifications,
     legal  opinions  or

                                       28

<PAGE>

     other information as either of them may reasonably  require to confirm that
     such transfer is being made pursuant to an exemption from, or a transaction
     not  subject  to, the  registration  requirements  of the  Securities  Act;
     provided  that the  Registrar  shall not be required to determine  (but may
     conclusively  rely on a determination  made by the Company with respect to)
     the  sufficiency  of any  such  certifications,  legal  opinions  or  other
     information.

          The  Registrar  shall retain  copies of all  certifications,  letters,
notices and other written communications received pursuant to Section 2.8 hereof
or  this  Section  2.9 in  accordance  with  its  customary  procedures  for the
retention of records  relating to the transfer of securities.  The Company shall
have the right to inspect and make copies of all such  certifications,  letters,
notices or other written  communications  at any reasonable time upon the giving
of reasonable prior written notice to the Registrar.

     Section 2.10  Holder Lists.

          The  Trustee  shall  preserve  in as  current a form as is  reasonably
practicable  the most recent list  available to it of the names and addresses of
Holders  and shall  otherwise  comply  with  Section  312(a) of the TIA.  If the
Trustee is not the Registrar,  the Company shall furnish to the Trustee prior to
or on each  Interest  Payment  Date and at such other  times as the  Trustee may
request  in writing a list in such form and as of such date as the  Trustee  may
reasonably  require  of the names and  addresses  of  Holders  relating  to such
Interest Payment Date or request, as the case may be.

     Section 2.11  Persons Deemed Owners.

          The  Company,  the Trustee and any agent of the Company or the Trustee
may treat the Holder as the owner of such  Security for the purpose of receiving
payment of principal of and premium, if any, and interest (including  Additional
Amounts, if any) on such Security and for all other purposes whatsoever, whether
or not such Security be overdue,  and notwithstanding any notice of ownership or
writing  thereon,  or any  notice of  previous  loss or theft or other  interest
therein.

     Section 2.12  Mutilated, Destroyed, Lost or Stolen Securities.

          If any mutilated  Security is surrendered to the Trustee,  the Company
shall  execute  and the  Trustee  shall  authenticate  and  deliver in  exchange
therefor a new Security of like tenor and principal  amount and bearing a number
not contemporaneously outstanding.

          If there is delivered to the Company and the Trustee:

               (1) evidence to their  satisfaction of the  destruction,  loss or
          theft of any Security, and

               (2) such security or indemnity as may be required by them to save
          each of them and any agent of either of them  harmless,  then,  in the
          absence

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<PAGE>

          of actual  notice to the Company that such  Security has been acquired
          by a bona fide purchaser,  the Company shall execute and, upon written
          request and in the absence of actual notice of a  Responsible  Officer
          of the Trustee  that such  Security  has been  acquired by a bona fide
          purchaser,  the Trustee shall authenticate and deliver, in lieu of any
          such destroyed,  lost or stolen Security, a new Security of like tenor
          and  principal  amount  and  bearing  a number  not  contemporaneously
          outstanding.

          In case any such  mutilated,  destroyed,  lost or stolen  Security has
become or is about to become due and payable, the Company in its discretion, but
subject to any conversion  rights,  may, instead of issuing a new Security,  pay
such  Security,  upon  satisfaction  of the condition set forth in the preceding
paragraph.

          Upon the issuance of any new Security under this Section,  the Company
may  require  the  payment  of a sum  sufficient  to  cover  any  tax  or  other
governmental  charge  that may be  imposed  in  relation  thereto  and any other
expenses (including the fees and expenses of the Trustee) connected therewith.

          Every new Security issued pursuant to this Section 2.12 in lieu of any
mutilated,  destroyed,  lost or stolen  Security  shall  constitute  an original
additional contractual obligation of the Company,  whether or not the mutilated,
destroyed,  lost or stolen Security shall be at any time  enforceable by anyone,
and such new Security  shall be entitled to all the  benefits of this  Indenture
equally  and  proportionately  with any and all  other  Securities  duly  issued
hereunder.

          The  provisions of this Section 2.12 are exclusive and shall  preclude
(to the  extent  lawful)  all other  rights  and  remedies  with  respect to the
replacement  or  payment of  mutilated,  destroyed,  lost or stolen  Securities.
Securities  so owned that have been  pledged in good  faith may be  regarded  as
Outstanding if the pledgee  establishes to the  satisfaction  of the Trustee the
pledgee's  right so to act with respect to such  Securities and that the pledgee
is not the Company or any Affiliate of the Company.

     Section 2.13  Treasury Securities.

          In determining  whether the Holders of the requisite  principal amount
of  Outstanding  Securities  are  present  at a meeting  of  Holders  for quorum
purposes or have given any request, demand,  authorization,  direction,  notice,
consent or waiver hereunder, Securities owned by the Company or any Affiliate of
the Company shall be disregarded and deemed not to be Outstanding,  except that,
in  determining  whether the Trustee shall be protected in relying upon any such
determination  as to the presence of a quorum or upon any such request,  demand,
authorization,  direction,  notice,  consent or waiver,  only such Securities of
which a Responsible  Officer of the Trustee has actually received written notice
and are so owned shall be so disregarded.

     Section 2.14  Temporary Securities.

          Pending the preparation of Securities in definitive  form, the Company
may  execute  and the  Trustee  shall,  upon  written  request  of the  Company,
authenticate  and  deliver  temporary   Securities  (printed  or  lithographed).
Temporary  Securities  shall be issuable  in any  authorized  denomination,  and
substantially  in the form of the  Securities in  definitive  form but with such

                                       30

<PAGE>

omissions,  insertions  and  variations  as may  be  appropriate  for  temporary
Securities,  all as may be  determined  by the  Company.  Every  such  temporary
Security shall be executed by the Company and  authenticated by the Trustee upon
the same  conditions  and in  substantially  the same manner,  and with the same
effect, as the Securities in definitive form.  Without  unreasonable  delay, the
Company will execute and deliver to the Trustee  Securities in  definitive  form
(other than in the case of  Securities  in global form) and thereupon any or all
temporary  Securities  (other than any such  Securities  in global  form) may be
surrendered  in exchange  therefor,  at each office or agency  maintained by the
Company  pursuant to Section 9.3 and the Trustee shall  authenticate and deliver
in exchange for such temporary Securities an equal aggregate principal amount of
Securities in definitive form. Such exchange shall be made by the Company at its
own expense and without any charge therefor.  Until so exchanged,  the temporary
Securities shall in all respects be entitled to the same benefits and subject to
the same  limitations  under this  Indenture as Securities  in  definitive  form
authenticated and delivered hereunder.

     Section 2.15  Cancellation.

          All  securities  surrendered  for  payment,  redemption,   repurchase,
conversion,  registration  of transfer or exchange  shall, if surrendered to any
Person other than the Trustee,  be delivered to the Trustee.  All  Securities so
delivered shall be canceled promptly by the Trustee,  and no Securities shall be
issued in lieu thereof except as expressly permitted by any of the provisions of
this  Indenture.  Upon written  instructions  of the Company,  the Trustee shall
dispose  of  canceled  Securities  in  accordance  with its  procedures  for the
disposition of cancelled securities in effect as of the date of such disposition
and, after such disposition,  shall deliver a certificate of such disposition to
the  Company.  If  the  Company  shall  acquire  any  of  the  Securities,  such
acquisition   shall  not  operate  as  a  redemption  or   satisfaction  of  the
Indebtedness represented by such Securities unless the same are delivered to the
Trustee for cancellation.

     Section 2.16  CUSIP Numbers.

          The Company in issuing the Securities may use "CUSIP" numbers (if then
generally  in use),  and the  Trustee  shall use CUSIP  numbers  in  notices  of
redemption  or exchange as a  convenience  to  Holders;  provided  that any such
notice shall state that no  representation is made as to the correctness of such
numbers  either as printed on the  Securities or as contained in any such notice
and that reliance may be placed only on the other identification numbers printed
on the Securities,  and any such redemption  shall not be affected by any defect
in or omission of such numbers. The Company shall promptly notify the Trustee of
any change in the CUSIP numbers.

     Section 2.17  Defaulted Interest.

          If  the  Company  fails  to  make a  payment  of  interest  (including
Additional  Amounts,  if any) on any Security  when due and payable  ("Defaulted
Interest"), it shall pay such Defaulted Interest plus (to the extent lawful) any
interest payable on the Defaulted  Interest,  in any lawful manner. It may elect
to pay such  Defaulted  Interest,  plus any such interest  payable on it, to the
Persons who are  Holders of such  Securities  on which the  interest is due on a
subsequent  Special Record Date. The Company shall notify the Trustee in writing
of the amount of Defaulted

                                       31

<PAGE>

Interest  proposed to be paid on each such  Security.  The Company shall fix any
such  Special  Record Date and payment date for such  payment.  At least 15 days
before any such Special Record Date, the Company shall mail to Holders  affected
thereby a notice that states the Special Record Date, the Interest Payment Date,
and amount of such interest (and such Additional Amounts, if any) to be paid.

                                   Article III

                           SATISFACTION AND DISCHARGE

     Section 3.1  Satisfaction and Discharge of Indenture.

         When:

          (a) the Company  shall  deliver to the Trustee  for  cancellation  all
Securities  previously  authenticated (other than any Securities which have been
mutilated,  destroyed,  lost or stolen  and in lieu of, or in  substitution  for
which,  other  Securities shall have been  authenticated  and delivered) and not
previously canceled;

         or

          (b) (i) all the Securities not previously canceled or delivered to the
Trustee  for  cancellation  shall have become due and  payable,  or are by their
terms  to  become  due and  payable  within  one  year or are to be  called  for
redemption  within one year under  arrangements  satisfactory to the Trustee for
the giving of notice of redemption;

          (i)  the Company  shall  deposit with the Trustee,  in trust,  cash in
               U.S. dollars and/or U.S. Government Obligations which through the
               payment  of  interest  and  principal  in  respect  thereof,   in
               accordance   with  their   terms,   will   provide  (and  without
               reinvestment  and  assuming no tax  liability  will be imposed on
               such  Trustee),  not later than one  Business  Day before the due
               date of any payment of money, an amount in cash,  sufficient,  in
               the opinion of a firm of independent public accountants expressed
               in a written  certification  thereof delivered to the Trustee, to
               pay  principal  of,  premium,  if  any,  or  interest  (including
               Additional  Amounts, if any) on all of the Securities (other than
               any Securities which shall have been mutilated,  destroyed,  lost
               or  stolen  and in lieu of or in  substitution  for  which  other
               Securities  shall  have been  authenticated  and  delivered)  not
               previously canceled or delivered to the Trustee for cancellation,
               on the dates such  payments  of  principal,  premium,  if any, or
               interest  (including  Additional Amounts, if any) are due to such
               date of maturity or redemption, as the case may be;

          (ii) the Company  shall have  delivered  to the  Trustee an  Officers'
               Certificate  and an Opinion of  Counsel,  each  stating  that all
               conditions   precedent   in  this   Indenture   relating  to  the
               satisfaction  and discharge of the  Indenture  have been complied
               with; and

                                       32

<PAGE>

         (iii) the Company  shall pay or cause to be paid all other sums payable
               hereunder by the Company;

then this Indenture shall cease to be of further effect (except as to:

               (1)  remaining  rights of registration of transfer,  substitution
                    and exchange and conversion of Securities;

               (2)  rights hereunder of Holders to receive payments of principal
                    of and premium, if any, and interest  (including  Additional
                    Amounts,  if any) on, the  Securities  and the other rights,
                    duties and obligations of Holders,  as beneficiaries  hereof
                    with respect to the amounts,  if any, so deposited  with the
                    Trustee; and

               (3)  the  rights,  obligations  and  immunities  of  the  Trustee
                    hereunder)

and  the  Trustee,  on  demand  of  the  Company  accompanied  by  an  Officers'
Certificate  and an  Opinion  of  Counsel  and at the  cost and  expense  of the
Company, shall execute instruments acknowledging satisfaction of and discharging
this Indenture;  provided, however, that the Company shall reimburse the Trustee
for all amounts due the Trustee  under Section 5.8 and for any costs or expenses
thereafter  reasonably incurred by the Trustee and to compensate the Trustee for
any services  thereafter  reasonably  rendered by the Trustee in connection with
this Indenture or the Securities.

     Section 3.2     Deposited Monies to be Held in Trust.

          Subject to Section 3.3, all monies deposited with the Trustee pursuant
to  Section  3.1  shall  be held in  trust  and  applied  by it to the  payment,
notwithstanding  the  provisions of Article 13,  either  directly or through any
Paying Agent  (including the Company if acting as its own Paying Agent),  to the
Holders of the particular Securities for the payment or redemption of which such
monies have been deposited  with the Trustee,  of all sums due and to become due
thereon for  principal,  premium,  if any,  and interest  (including  Additional
Amounts,  if any). All monies deposited with the Trustee pursuant to Section 3.1
(and held by it or any Paying Agent) for the payment of Securities  subsequently
converted shall be returned to the Company upon written request of the Company.

          The Company shall pay and  indemnify the Trustee  against any tax, fee
or other charges imposed on or assessed against the U.S. Government  Obligations
deposited  pursuant to Section 3.1 or the  principal  and  interest  received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of Outstanding Securities.

     Section 3.3  Return of Unclaimed Monies.

          The  Trustee  and the Paying  Agent shall pay to the Company any money
held by them for the  payment of  principal  or  premium,  if any,  or  interest
(including  Additional Amounts, if any) that remains unclaimed for 2 years after
the date upon which such  payment  shall have become due.  After  payment to the
Company,  Holders  entitled to the money must look to the Company for payment as
general creditors unless an applicable abandoned property law

                                       33

<PAGE>

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

                                   Article IV

                              DEFAULTS AND REMEDIES

     Section 4.1  Events of Default.

          An "Event of Default" with respect to the  Securities  occurs when any
of the  following  occurs  (whatever  the reason  for such Event of Default  and
whether it be  voluntary  or  involuntary  or be effected by operation of law or
pursuant  to any  judgment,  decree or order of any court or any order,  rule or
regulation of any administrative or governmental body):

          (a)  the  Company  defaults  in the  payment  of the  principal  of or
premium,  if any,  on any of the  Securities  when it becomes due and payable at
Maturity,  upon  redemption  or exercise  of a  Repurchase  Right or  otherwise,
whether or not such payment  prohibited by the subordination  provisions of this
Indenture; or

          (b)  the  Company  defaults  in the  payment  of  interest  (including
Additional  Amounts,  if any) on any of the  Securities  when it becomes due and
payable and such default  continues for a period of 30 day,  whether or not such
payment prohibited by the subordination provisions of this Indentures; or

          (c) the Company  fails to perform or observe any other term,  covenant
or  agreement  contained in the  Securities  or this  Indenture  and the default
continues  for a  period  of 60 days  after  written  notice  of  such  failure,
requiring  the Company to remedy the same,  shall have been given to the Company
by the  Trustee or to the Company and the Trustee by the Holders of at least 25%
in aggregate principal amount of the Outstanding Securities; or

          (d) the Company or the Guarantor fails to make any payment (whether of
principal or interest and  regardless of amount) in respect of any  Indebtedness
aggregating  $15,000,000  or more,  when and as the same  shall  become  due and
payable (beyond any applicable grace period expressly set forth in the governing
documents),  unless such  Indebtedness is discharged;  or any event or condition
occurs that results in any such Indebtedness becoming due prior to its scheduled
maturity or that enables or permits  (with or without the giving of notice,  the
lapse of time or both) the  holder or holders  of any such  Indebtedness  or any
trustee or agent on its or their behalf to cause any such Indebtedness to become
due, or to require the prepayment, repurchase, redemption or defeasance thereof,
prior to its scheduled  maturity,  unless such  acceleration  is waived,  cured,
rescinded  or  annulled,  and such  failure  or such  event or  condition  shall
continue for a period of 30 days after written notice of such failure shall have
been given to the  Company by the  Trustee or to the  Company and the Trustee by
the Holders of at least 25% in  aggregate  principal  amount of the  Outstanding
Securities; or

          (e) the entry by a court having  jurisdiction in the premises of (i) a
decree or order for  relief in respect of the  Company or the  Guarantor,  in an
involuntary  case or  proceeding  under

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<PAGE>

any applicable U.S. federal or state bankruptcy,  insolvency,  reorganization or
other similar law or (ii) a decree or order adjudging the Company or, a bankrupt
or insolvent,  or approving as properly filed a petition seeking reorganization,
arrangement,  adjustment or  composition  of or in respect of the Company or the
Guarantor,  under any  applicable  U.S.  federal or state law, or  appointing  a
custodian,  receiver,  liquidator,  assignee,  trustee,  sequestrator  or  other
similar official of the Company or the Guarantor,  or of any substantial part of
its property,  or ordering the winding up or liquidation of its affairs, and the
continuance  of any such decree or order for relief or any such other  decree or
order unstayed and in effect for a period of 60 consecutive days; or

          (f) the  commencement by the Company or the Guarantor,  of a voluntary
case or  proceeding  under any  applicable  U.S.  federal  or state  bankruptcy,
insolvency,  reorganization  or  other  similar  law or of  any  other  case  or
proceeding  to be  adjudicated  a bankrupt or  insolvent,  or the consent by the
Company to the entry of a decree or order for  relief in respect of the  Company
in an involuntary  case or proceeding under any applicable U.S. federal or state
bankruptcy,   insolvency,   reorganization  or  other  similar  law  or  to  the
commencement  of any  bankruptcy  or insolvency  case or proceeding  against the
Company  or the  Guarantor,  or the filing by the  Company  the  Guarantor  of a
petition  or answer  or  consent  seeking  reorganization  or  relief  under any
applicable  U.S.  federal or state  law,  or the  consent by the  Company or the
Guarantor, to the filing of such petition or to the appointment of or the taking
possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator
or other  similar  official  of the  Company or of any  substantial  part of its
property,  or the making by the Company or the  Guarantor,  of an assignment for
the benefit of  creditors,  or the  admission by the Company or the Guarantor in
writing of its  inability to pay its debts  generally as they become due, or the
taking of corporate  action by the Company  expressly in furtherance of any such
action; or

          (g) the Guarantee ceases to be in full force and effect (other than as
expressly  provided for under this  Indenture)  or is declared null and void, or
the Guarantor denies that it has any further  liability under the Guarantee,  or
gives  notice  to such  effect  (other  than by reason  of  termination  of this
Indenture or release of the Guarantee in accordance with this Indenture).

     Section 4.2  Acceleration of Maturity; Rescission and Annulment.

          If an Event of Default with respect to Outstanding  Securities  (other
than an Event of Default  specified in Section  4.1(e) or 4.1(f))  occurs and is
continuing,  the Trustee or the Holders of at least 25% in  aggregate  principal
amount of the  Outstanding  Securities,  by written  notice to the Company,  may
declare  due  and  payable  100%  of the  principal  amount  of all  Outstanding
Securities plus any accrued and unpaid interest  (including  Additional Amounts,
if any)  to the  date of  payment.  Upon a  declaration  of  acceleration,  such
principal and accrued and unpaid interest (including Additional Amounts, if any)
to the date of payment shall be immediately due and payable.

          If an Event of Default  specified in Section  4.1(e) or 4.1(f) occurs,
all unpaid  principal  and accrued  and unpaid  interest  (including  Additional
Amounts,  if any) on the Outstanding  Securities shall become and be immediately
due and payable, without any declaration or other act on the part of the Trustee
or any Holder.

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<PAGE>

          The Holders  either (a) through  written  notice to the Trustee of not
less  than  a  majority  in  aggregate   principal  amount  of  the  Outstanding
Securities,  or (b) by the adoption of a resolution,  at a meeting of Holders of
the  Outstanding  Securities at which a quorum is present,  by the Holders of at
least a majority in aggregate  principal  amount of the  Outstanding  Securities
represented  at such  meeting,  may,  on  behalf  of the  Holders  of all of the
Securities, rescind and annul an acceleration and its consequences if:

               (1) all existing Events of Default,  other than the nonpayment of
          principal  of or  interest  on the  Securities  which have  become due
          solely  because  of the  acceleration,  have been  remedied,  cured or
          waived, and

               (2) the rescission would not conflict with any judgment or decree
          of a court of competent jurisdiction.

     Section 4.3  Other Remedies.

          If an Event of Default with respect to Outstanding  Securities  occurs
and is continuing,  the Trustee may pursue any available remedy by proceeding at
law or in equity to collect  the  payment of  principal  of or  interest  on the
Securities or to enforce the performance of any provision of the Securities.

          The Trustee may maintain a proceeding  in which it may  prosecute  and
enforce all rights of action and claims under this Indenture or the  Securities,
even if it does not  possess  any of the  Securities  or does not produce any of
them in the proceeding.

     Section 4.4  Waiver of Past Defaults.

          The Holders, either (a) through the written consent of not less than a
majority in aggregate principal amount of the Outstanding Securities,  or (b) by
the  adoption  of a  resolution,  at a meeting  of  Holders  of the  Outstanding
Securities  at which a quorum is present,  by the Holders of at least a majority
in aggregate principal amount of the Outstanding  Securities represented at such
meeting,  may,  on  behalf of the  Holders  of all of the  Securities,  waive an
existing Default or Event of Default, except a Default or Event of Default:

               (1) in the payment of the  principal  of or  premium,  if any, or
          interest  (including  Additional  Amounts,  if  any)  on any  Security
          (provided,  however,  that  subject to Section  4.7,  the Holders of a
          majority in aggregate  principal amount of the Outstanding  Securities
          may  rescind  an  acceleration  and its  consequences,  including  any
          related payment default that resulted from such acceleration); or

               (2) in respect of a covenant or  provision  hereof  which,  under
          Section 7.2,  cannot be modified or amended without the consent of the
          Holders of each Outstanding Security affected.

Upon any such  waiver,  such  Default  shall  cease to  exist,  and any Event of
Default arising  therefrom shall be deemed to have been cured, for every purpose
of this Indenture;  provided,

                                       36

<PAGE>

however,  that no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.

     Section 4.5  Control by Majority.

          The  Holders  of a  majority  in  aggregate  principal  amount  of the
Outstanding  Securities  (or such lesser amount as shall have acted at a meeting
pursuant to the provisions of this Indenture) shall have the right to direct the
time,  method and place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred on the Trustee.  However,
the Trustee may refuse to follow any direction that:

               (1) conflicts with any law or with this Indenture;

               (2) the  Trustee  determines  may be  unduly  prejudicial  to the
          rights of the Holders not joining therein; or

               (3) may expose the Trustee to personal liability.

          The Trustee  may take any other  action  deemed  proper by the Trustee
which is not inconsistent with such direction.

     Section 4.6  Limitation on Suit.

          No Holder of any  Security  shall  have any right to pursue any remedy
with respect to this Indenture or the  Securities  (including,  instituting  any
proceeding,  judicial or  otherwise,  with respect to this  Indenture or for the
appointment of a receiver or trustee) unless:

               (1) such  Holder  has  previously  given  written  notice  to the
          Trustee of an Event of Default that is continuing;

               (2) the Holders of at least 25% in aggregate  principal amount of
          the  Outstanding  Securities  shall have made  written  request to the
          Trustee to pursue the remedy;

               (3) such Holder or Holders have offered to the Trustee  indemnity
          satisfactory  to  it  against  any  costs,  expenses  and  liabilities
          incurred in complying with such request;

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

               (5) during such 60-day  period,  no direction  inconsistent  with
          such written request has been given to the Trustee by the Holders of a
          majority in aggregate  principal amount of the Outstanding  Securities
          (or such  amount  as shall  have  acted at a meeting  pursuant  to the
          provisions of this Indenture);

                                       37

<PAGE>

provided, however, that no one or more of such Holders may use this Indenture to
prejudice the rights of another Holder or to obtain preference or priority over
another Holder.

     Section  4.7  Unconditional  Rights of Holders to  Receive  Payment  and to
Convert.

          Notwithstanding  any other provision in this Indenture,  the Holder of
any  Security  shall have the right,  which is absolute  and  unconditional,  to
receive payment of the principal of and premium, if any, and interest (including
Additional Amounts, if any) on such Security on the Stated Maturity expressed in
such Security (or, in the case of redemption,  on the Redemption Date, or in the
case of the  exercise of a  Repurchase  Right,  on the  Repurchase  Date) and to
convert such Security in accordance  with Article 12, and to bring an action for
the enforcement of any such payment on or after such  respective  dates and such
right to convert,  and such rights shall not be impaired or affected without the
consent of such Holder.

     Section 4.8 Collection of Indebtedness and Suits for Enforcement by
the Trustee.

          The  Company  covenants  that if an  Event  of  Default  described  in
Sections  4.1(a) or 4.1(b)  occurs with respect to any  Securities,  the Company
will,  upon demand of the Trustee,  pay to it, for the benefit of the Holders of
such Securities,  the whole amount then due and payable (as expressed therein or
as a result  of any  acceleration  effected  pursuant  to  Section  4.2) on such
Securities for principal and premium, if any, and interest (including Additional
Amounts,  if any) and,  to the extent  that  payment of such  interest  shall be
legally enforceable,  interest on any overdue principal and premium, if any, and
on any overdue interest (including Additional Amounts, if any), calculated using
the Interest  Rate,  and, in addition  thereto,  such further amount as shall be
sufficient  to cover  the  costs  and  expenses  of  collection,  including  the
reasonable  compensation,  expenses,  disbursements and advances of the Trustee,
its agents and counsel.

          If the Company fails to pay such amounts  forthwith  upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial  proceeding  for the  collection  of the  sums so due and  unpaid,  may
prosecute  such  proceeding to judgment or final decree and may enforce the same
against the Company and collect the monies  adjudged or decreed to be payable in
the  manner  provided  by law  out  of the  property  of the  Company,  wherever
situated.

          If an Event of Default  occurs and is  continuing,  the Trustee may in
its  discretion  proceed to protect and enforce its rights and the rights of the
Holders of Securities by such  appropriate  judicial  proceedings as the Trustee
shall deem  necessary  to protect and enforce any such  rights,  whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid of
the exercise of any power granted herein, or to enforce any other proper remedy.

     Section 4.9  Trustee May File Proofs of Claim.

          In case of the pendency of any receivership,  insolvency, liquidation,
bankruptcy,  reorganization,   arrangement,  adjustment,  composition  or  other
judicial  proceeding  relative to the

                                       38

<PAGE>

Company  or  the  property  of  the  Company  or  its  creditors,   the  Trustee
(irrespective  of whether the principal of the Securities  shall then be due and
payable as therein  expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand on the Company for the payment of
overdue principal or interest  (including  Additional Amounts, if any)) shall be
entitled and empowered, by intervention in such proceeding or otherwise:

               (1) to file and prove a claim for the whole  amount of  principal
          and premium,  if any, and interest  (including  Additional Amounts, if
          any) owing and unpaid in  respect of the  Securities  and to file such
          other papers or documents as may be necessary or advisable in order to
          have the claims of the Trustee (including any claim for the reasonable
          compensation,  expenses, disbursements,  advances and indemnification,
          of the  Trustee,  its  agents  and  counsel)  and of  the  Holders  of
          Securities allowed in such judicial proceeding; and

               (2) to collect and receive any monies or other  property  payable
          or deliverable on any such claim and to distribute the same;

and any custodian,  receiver,  assignee,  trustee,  liquidator,  sequestrator or
other similar official in any such judicial  proceedings is hereby authorized by
each Holder of Securities to make such payments to the Trustee and, in the event
that the Trustee shall  consent to the making of such  payments  directly to the
Holders  of  Securities,  to pay to the  Trustee  any  amount  due to it for the
reasonable  compensation,  expenses,  disbursements and advances of the Trustee,
its agents and counsel and any other amounts due the Trustee under Section 5.8.

          Nothing  contained  herein shall be deemed to authorize the Trustee to
authorize  or  consent  to or  accept,  or adopt on  behalf  of any  Holder of a
Security,  any plan of  reorganization,  arrangement,  adjustment or composition
affecting the Securities or the rights of any Holder thereof or to authorize the
Trustee to vote in respect of the claim of any Holder of a Security  in any such
proceeding.

     Section 4.10  Restoration of Rights and Remedies.

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

     Section 4.11  Rights and Remedies Cumulative.

          Except as  otherwise  provided  with  respect  to the  replacement  or
payment of mutilated, destroyed, lost or stolen Securities in the last paragraph
of Section 2.12, no right or remedy conferred in this Indenture upon or reserved
to the Trustee or to the Holders of  Securities  is intended to be  exclusive of
any other  right or  remedy,  and every  right and remedy  shall,  to the extent

                                       39

<PAGE>

permitted by law, be cumulative  and in addition to every other right and remedy
given  hereunder or  hereafter  existing at law or in equity or  otherwise.  The
assertion or employment of any right or remedy  hereunder,  or otherwise,  shall
not prevent the  concurrent  assertion or  employment  of any other  appropriate
right or remedy.

     Section 4.12  Delay or Omission Not Waiver.

          No delay or omission  of the Trustee or of any Holder of any  Security
to exercise any right or remedy  accruing upon any Event of Default shall impair
any such right or remedy or  constitute a waiver of any such Event of Default or
any acquiescence therein. Every right and remedy given by this Article or by law
to the Trustee or to the Holders of  Securities  may be  exercised  from time to
time, and as often as may be deemed expedient,  by the Trustee or by the Holders
of Securities, as the case may be.

     Section 4.13  Application of Money Collected.

          Any money  collected by the Trustee  pursuant to this Article shall be
applied in the following  order,  at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal or premium, if
any, or interest  (including  Additional  Amounts, if any), upon presentation of
the  Securities  and the notation  thereon of the payment if only partially paid
and upon surrender thereof if fully paid:

          FIRST: To the payment of all amounts due the Trustee;

          SECOND:  To the  payment  of the  amounts  then  due  and  unpaid  for
          principal of and premium, if any, and interest  (including  Additional
          Amounts,  if any) on the Securities,  ratably,  without  preference or
          priority of any kind, according to the amounts due and payable on such
          Securities for principal and premium,  if any, and interest (including
          Additional Amounts, if any), respectively; and

          THIRD: Any remaining amounts shall be repaid to the Company.

     Section IV.14  Undertaking for Costs.

          The parties to this Indenture  agree,  and each Holder of any Security
by such Holder's  acceptance  thereof  shall be deemed to have agreed,  that any
court may in its  discretion  require,  in any suit for the  enforcement  of any
right or remedy under this Indenture, or in any suit against the Trustee for any
action  taken,  suffered  or omitted by it as  Trustee,  the filing by any party
litigant in such suit of an  undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs,  including  reasonable
attorneys'  fees and expenses,  against any party litigant in such suit,  having
due regard to the merits and good faith of the claims or  defenses  made by such
party  litigant;  but the provisions of this Section shall not apply to any suit
instituted by the Company,  to any suit  instituted by the Trustee,  to any suit
instituted by any Holder,  or group of Holders,  holding in the  aggregate  more
than 10% in aggregate principal amount of the Outstanding Securities,  or to any
suit instituted by any Holder of any Security for the enforcement of the payment
of the  principal  of or  premium,  if any, or  interest  (including  Additional
Amounts,  if any) on any Security on or after the Stated  Maturity  expressed in

                                       40

<PAGE>

such Security (or, in the case of redemption,  on the Redemption Date, or in the
case of the exercise of a Repurchase  Right, on or after the Repurchase Date) or
for the  enforcement  of the right to convert any  Security in  accordance  with
Article 12. For avoidance of doubt, the parties to this Indenture hereby confirm
that this Section 4.14 shall be of no force and effect as against the Trustee.

     Section 4.15  Waiver of Stay or Extension Laws.

          The Company  covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
to take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time  hereafter  in force,  which may affect the  covenants or the
performance  of this  Indenture;  and the  Company  (to the  extent  that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and  covenants  that it will not hinder,  delay or impede the  execution  of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.

                                    Article V

                                   THE TRUSTEE

     Section 5.1  Certain Duties and Responsibilities.

          (a) The Trustee undertakes to perform such duties and only such duties
as are  specifically  set forth in this  Indenture  or the TIA,  and no  implied
covenants or obligations shall be read into this Indenture against the Trustee.

          (b)  In the  absence  of  bad  faith  on its  part,  the  Trustee  may
conclusively  rely, as to the truth of the statements and the correctness of the
opinions  expressed  therein,  upon  certificates  or opinions  furnished to the
Trustee and conforming to the requirements of this Indenture; provided, however,
that in the case of any such  certificates  or opinions  which by any  provision
hereof are  specifically  required to be furnished  to the Trustee,  the Trustee
shall examine the certificates or opinions to determine whether or not, on their
face,  they  conform  to the  requirements  to  this  Indenture  (but  need  not
investigate or confirm the accuracy of any facts stated therein).

          (c) In case an  Event  of  Default  actually  known  to a  Responsible
Officer of the  Trustee  has  occurred  and is  continuing,  the  Trustee  shall
exercise  such of the rights and powers  vested in it by this  Indenture and use
the same degree of care and skill in their  exercise as a prudent  person  would
exercise  or use under the  circumstances  in the conduct of such  person's  own
affairs.

          (d) No provision of this  Indenture  shall be construed to relieve the
Trustee from liability for its own negligent  action,  its own negligent failure
to act, or its own willful misconduct, except that:

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<PAGE>

               (1) This paragraph (c) shall not be construed to limit the effect
          of paragraph (a) or (b) of this Section 5.1;

               (2) The  Trustee  shall not be liable  for any error of  judgment
          made in good faith by a Responsible Officer, unless it shall be proved
          that the Trustee was negligent in  ascertaining  the pertinent  facts;
          and

               (3) The Trustee  shall not be liable  with  respect to any action
          taken or omitted to be taken by it in good faith in accordance  with a
          direction  received by it of the  Holders of a majority  in  principal
          amount of the  Outstanding  Securities (or such lesser amount as shall
          have acted at a meeting  pursuant to the provisions of this Indenture)
          relating to the time,  method and place of conducting  any  proceeding
          for any remedy  available to the Trustee,  or exercising  any trust or
          power conferred upon the Trustee, under this Indenture.

          (e) Whether or not herein  expressly so provided,  every  provision of
this  Indenture  relating  to the  conduct  or  affecting  the  liability  of or
affording  protection to the Trustee shall be subject to the  provisions of this
Section 5.1.

          (f) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any liability in the performance of any
of its duties hereunder,  or in the exercise of any of its rights or powers. The
Trustee may refuse to perform any duty or exercise  any right or power,  whether
requested by the Company,  the Holders or any other  Person,  unless it receives
indemnity  satisfactory  to it  against  any loss,  liability,  cost or  expense
(including, without limitation, reasonable fees of counsel).

          (g) The Trustee shall not be obligated to pay interest on any money or
other assets received by it unless otherwise agreed in writing with the Company.
Assets  held in trust by the  Trustee  need not be  segregated  from other funds
except to the extent required by law.

          (h) The Trustee shall not be bound to make any investigation  into the
facts or matters stated in any resolution,  certificate,  statement, instrument,
opinion,  report, notice, request,  direction,  consent, order, bond, debenture,
note, coupon, other evidence of Indebtedness or other paper or document, but the
Trustee, in its discretion,  may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall  determine to
make such further inquiry or investigation,  it shall be entitled to examine the
books,  records and premises of the Company,  personally or by agent or attorney
at the sole cost of the  Company  and shall  incur no  liability  or  additional
liability of any kind by reason of such inquiry or investigation.

          (i) The Trustee shall not be deemed to have notice or actual knowledge
of any Event of Default  unless a Responsible  Officer of the Trustee has actual
knowledge  thereof  or unless  written  notice  of any event  which is in fact a
Default is  received by the  Trustee  pursuant  to Section  15.2 and such notice
references the Securities and this Indenture.

          (j) The rights, privileges, protections, immunities and benefits given
to the  Trustee  hereunder,  including,  without  limitation,  its  right  to be
indemnified,  are extended to, and

                                       42

<PAGE>
shall be enforceable  by, the Trustee in each of its capacities  hereunder,  and
each Paying Agent,  authenticating  agent,  Conversion Agent or Registrar acting
hereunder.

          (k) The  Trustee may request  that the  Company  deliver an  Officers'
Certificate  setting  forth the names of  individuals  and/or titles of officers
authorized at such time to take specified  actions  pursuant to this  Indenture,
which Officers'  Certificate  may be signed by any person  authorized to sign an
Officers'  Certificate,  including any person  specified as so authorized in any
such certificate previously delivered and not superseded.

     Section 5.2  Certain Rights of Trustee.

          Subject to the provisions of Section 5.1 and subject to Section 315(a)
through (d) of the TIA:

               (1) The Trustee may conclusively rely on any document believed by
          it to be genuine  and to have been signed or  presented  by the proper
          person.  The Trustee need not investigate any fact or matter stated in
          the document.

               (2) Before the  Trustee  acts or  refrains  from  acting,  it may
          require an Officers'  Certificate  or an Opinion of Counsel,  or both.
          The  Trustee  shall not be liable  for any action it takes or omits to
          take in good faith in reliance on the Officers' Certificate or Opinion
          of Counsel.

               (3) The Trustee may act  through  attorneys  and agents and shall
          not be responsible for the misconduct or negligence of any attorney or
          agent appointed with due care.

               (4) The  Trustee  shall not be  liable  for any  action  taken or
          omitted  to be  taken by it in good  faith  which  it  believed  to be
          authorized or within the discretion or rights or powers conferred upon
          it  by  this  Indenture,  unless  the  Trustee's  conduct  constitutes
          negligence.

               (5) The Trustee may consult with counsel of its selection and the
          advice of such counsel  shall be full and complete  authorization  and
          protection in respect of any action  taken,  omitted or suffered by it
          hereunder in good faith and in  accordance  with the advice or opinion
          of such counsel.

               (6) Unless otherwise specifically provided in this Indenture, any
          demand,  request,  direction  or  notice  from  the  Company  shall be
          sufficient if signed by an Officer of the Company.

               (7) The permissive  rights of the Trustee to do things enumerated
          in this Indenture shall not be construed as a duty unless so specified
          herein.

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<PAGE>

     Section 5.3  Individual Rights of Trustee.

          The Trustee in its  individual  or any other  capacity  may become the
owner or pledgee of Securities  and may  otherwise  deal with the Company or any
Affiliate  of the  Company  with the same  rights  it would  have if it were not
Trustee.  However,  in the  event  that the  Trustee  acquires  any  conflicting
interest  (as such term is  defined  in  Section  310(b)  of the  TIA),  it must
eliminate  such  conflict  within 90 days,  apply to the SEC for  permission  to
continue as trustee (to the extent permitted under Section 310(b) of the TIA) or
resign.  Any agent may do the same with like rights and  duties.  The Trustee is
also  subject  to  Sections  5.11 and 5.12.

     Section  V.4  Money  Held in Trust.

          Money held by the Trustee in trust  hereunder  need not be  segregated
from other  funds  except to the extent  required by law.  The Trustee  shall be
under no liability for interest on any money received by it hereunder  except as
otherwise expressly agreed with the Company.

     Section 5.5  Trustee's Disclaimer.

          The recitals  contained herein and in the Securities (except for those
in the  certificate of  authentication)  shall be taken as the statements of the
Company,  and the Trustee assumes no responsibility for their  correctness.  The
Trustee makes no representations as to the validity,  sufficiency or priority of
this Indenture or of the  Securities.  The Trustee shall not be accountable  for
the use or application by the Company of Securities or the proceeds thereof.

     Section 5.6  Notice of Defaults.

          Within 90 days after the occurrence of any Default or Event of Default
hereunder of which a  Responsible  Officer of the Trustee has  received  written
notice,  the  Trustee  shall give notice to Holders  pursuant  to Section  15.2,
unless  such  Default  or Event of  Default  shall  have been  cured or  waived;
provided,  however, that, except in the case of a Default or Event of Default in
the  payment of the  principal  of or premium,  if any,  or interest  (including
Additional  Amounts,  if any), or in the payment of any redemption or repurchase
obligation on any Security,  the Trustee shall be protected in withholding  such
notice if and so long as  Responsible  Officers  of the  Trustee  in good  faith
determine that the withholding of such notice is in the interest of the Holders.

     Section 5.7  Reports by Trustee to Holders.

          The Trustee  shall  transmit to Holders  such reports  concerning  the
Trustee and its actions  under this  Indenture as may be required by Section 313
of the TIA at the times and in the manner provided by the TIA.

          A copy of each report at the time of its  mailing to Holders  shall be
filed with the SEC, if required,  and each stock exchange,  if any, on which the
Securities  are listed.  The Company  shall  promptly  notify the Trustee if the
Securities become listed on any stock exchange or delisted therefrom.

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<PAGE>

     Section 5.8  Compensation and Indemnification.

          The Company  covenants  and agrees to pay to the Trustee  from time to
time, and the Trustee shall be entitled to, such compensation as the Company and
the Trustee shall from time to time agree in writing (which shall not be limited
by any provision of law in regard to the compensation of a trustee of an express
trust) and the Company covenants and agrees to pay or reimburse the Trustee upon
its request for all reasonable expenses,  disbursements and advances incurred or
made by or on  behalf of it in  accordance  with any of the  provisions  of this
Indenture   (including  the  reasonable   compensation   and  the  expenses  and
disbursements  of its counsel and of all agents and other  persons not regularly
in its  employ),  except to the extent that any such  expense,  disbursement  or
advance is due to its negligence or bad faith.  When the Trustee incurs expenses
or renders services in connection with an Event of Default  specified in Section
4.1, the expenses (including the reasonable charges and expenses of its counsel)
and the  compensation  for the services are intended to  constitute  expenses of
administration under any bankruptcy law. The Company also covenants to indemnify
the Trustee and its officers, directors, employees and agents (collectively, the
"Indemnitees")  for,  and to hold  such  Persons  harmless  against,  any  loss,
liability or expense incurred by them,  arising out of or in connection with the
acceptance or  administration  of this Indenture or the trusts  hereunder or the
performance  of their  duties  hereunder,  including  the costs and  expenses of
defending  themselves  against or  investigating  any claim of  liability in the
premises,  except to the extent that any such loss, liability or expense was due
to the negligence or willful  misconduct of the Indemnitees.  The obligations of
the Company under this Section 5.8 to compensate  and indemnify the  Indemnitees
and to pay or reimburse  such Persons for expenses,  disbursements  and advances
shall  constitute  additional  Indebtedness  hereunder  and  shall  survive  the
satisfaction  and  discharge  of this  Indenture or the earlier  resignation  or
removal of the Trustee.  Such additional  Indebtedness  shall be a lien prior to
that of the  Securities  upon all  property  and funds held or  collected by the
Trustee as such,  except  funds held in trust for the  benefit of the Holders of
particular Securities, and the Securities are hereby subordinated to such senior
claim.  "Trustee" for purposes of this Section 5.8 shall include any predecessor
Trustee,  but the  negligence  or willful  misconduct  of any Trustee  shall not
affect the indemnification of any other Trustee.

     Section 5.9  Replacement of Trustee.

          A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor  Trustee's  acceptance of
appointment as provided in this Section 5.9.

          The Trustee may resign and be discharged from the trust hereby created
by so  notifying  the Company in writing.  The Holders of at least a majority in
aggregate  principal amount of Outstanding  Securities may remove the Trustee by
so notifying the Trustee and the Company in writing. The Company must remove the
Trustee if:

          (i)  the Trustee  fails to comply with  Section 5.10 or Section 310 of
               the TIA;

         (ii)  the Trustee becomes incapable of acting;

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<PAGE>

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

         (iv)  Custodian  or public  officer  takes charge of the Trustee or its
               property.

          If the  Trustee  resigns or is  removed or if a vacancy  exists in the
office of the Trustee  for any reason,  the  Company  shall  promptly  appoint a
successor  Trustee.  The  Trustee  shall be  entitled to payment of its fees and
reimbursement of its expenses while acting as Trustee. Within one year after the
successor Trustee takes office,  the Holders of at least a majority in aggregate
principal  amount of Outstanding  Securities may appoint a successor  Trustee to
replace the successor Trustee appointed by the Company.

          Any Holder may petition any court of  competent  jurisdiction  for the
removal of the Trustee and the appointment of a successor Trustee if the Trustee
fails to comply with Section 5.10.

          If an instrument  of acceptance by a successor  Trustee shall not have
been  delivered to the Trustee within 30 days after the giving of such notice of
resignation or removal,  the resigning or removed  Trustee,  as the case may be,
may petition, at the expense of the Company, any court of competent jurisdiction
for the appointment of a successor Trustee.

          A  successor  Trustee  shall  deliver  a  written  acceptance  of  its
appointment  to  the  retiring  Trustee  and  to  the  Company.   Thereupon  the
resignation or removal of the retiring Trustee shall become  effective,  and the
successor  Trustee  shall have all the rights,  powers and duties of the Trustee
under  this  Indenture.  The  Company  shall  issue a  notice  of the  successor
Trustee's  succession to the Holders.  Upon payment of its charges, the retiring
Trustee  shall  promptly  transfer  all  property  held by it as  Trustee to the
successor  Trustee,  subject  nevertheless to its lien, if any,  provided for in
Section 5.8. Notwithstanding replacement of the Trustee pursuant to this Section
5.9, the Company's  obligations under Section 5.8 shall continue for the benefit
of the  retiring  Trustee  with  respect to  expenses,  losses  and  liabilities
incurred by it prior to such replacement.

     Section 5.10  Successor Trustee by Merger, Etc.

          Subject to Section 5.11, if the Trustee  consolidates  with, merges or
converts  into, or transfers  all or  substantially  all of its corporate  trust
business to, another Person,  corporation or national banking  association,  the
successor  entity  without any further act shall be the successor  Trustee as to
the Securities.

     Section 5.11  Corporate Trustee Required; Eligibility.

          The Trustee  shall at all times  satisfy the  requirements  of Section
310(a)(1),  (2) and (5) of the TIA. The Trustee  shall at all times have (or, in
the case of a corporation included in a bank holding company system, the related
bank holding company shall at all times have), a combined capital and surplus of
at least $25 million as set forth in its (or its related bank holding company's)
most recent  published  annual  report of  condition.  The Trustee is subject to
Section 310(b) of the TIA.

                                       46

<PAGE>

     Section 5.12  Collection of Claims Against the Company.

          The  Trustee is subject to Section  311(a) of the TIA,  excluding  any
creditor  relationship  listed in Section  311(b) of the TIA. A Trustee  who has
resigned or been  removed  shall be subject to Section  311(a) of the TIA to the
extent indicated therein.

                                   Article VI

              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

     Section 6.1 Company and Guarantor May  Consolidate,  Etc.,  Only on Certain
Terms.

          (a)  Without  the  consent  of the  Holders,  the  Company  shall  not
consolidate with or merge into any other Person or convey, transfer or lease its
properties and assets substantially as an entirety to any Person, unless:

               (1) the  Person  formed by such  consolidation  or into which the
          Company  is merged or the  Person  which  acquires  by  conveyance  or
          transfer,  or which leases,  the  properties and assets of the Company
          substantially  as an entirety shall be a  corporation,  partnership or
          trust organized and validly  existing under the laws of (i) the United
          States of  America,  (ii) any State  thereof  (iii)  the  District  of
          Columbia or (iv) Bermuda;

               (2) in the event that the entity  surviving  such  transaction or
          transferee  entity is not the Company,  such  surviving or  transferee
          entity shall expressly  assume, by an indenture  supplemental  hereto,
          executed and delivered to the Trustee, in form reasonably satisfactory
          to the Trustee,  the due and punctual  payment of the principal of and
          premium, if any and interest  (including  Additional Amounts, if any),
          on all the  Securities  and the  performance of every covenant of this
          Indenture  on the part of the Company to be  performed or observed and
          shall have provided for conversion  rights in accordance  with Section
          12.11;

               (3) at the time of consummation of such transaction,  no Event of
          Default,  and no event  which,  after notice or lapse of time or both,
          would  become  an  Event  of  Default,  shall  have  happened  and  be
          continuing; and

               (4) the Company shall have  delivered to the Trustee an Officers'
          Certificate  and  an  Opinion  of  Counsel,  each  stating  that  such
          consolidation,  merger,  conveyance,  transfer  or  lease  and,  if  a
          supplemental   indenture   is   required  in   connection   with  such
          transaction, such supplemental indenture, comply with this Article and
          that all  conditions  precedent  herein  provided for relating to such
          transaction have been complied with.

                                       47

<PAGE>

          (b)  Without  the  consent of the  Holders,  the  Guarantor  shall not
consolidate with or merge into any other Person or convey, transfer or lease its
properties and assets substantially as an entirety to any Person, unless:

               (1) the  Person  formed by such  consolidation  or into which the
          Guarantor  is merged or the Person  which  acquires by  conveyance  or
          transfer,  or which leases, the properties and assets of the Guarantor
          substantially  as an entirety shall be a  corporation,  partnership or
          trust organized and validly  existing under the laws of (i) the United
          States of  America,  (ii) any State  thereof  (iii)  the  District  of
          Columbia or (iv) Bermuda;

               (2) in the event that the entity  surviving  such  transaction or
          transferee  entity is not the Guarantor,  such surviving or transferee
          entity shall expressly  assume, by an indenture  supplemental  hereto,
          executed and delivered to the Trustee, in form reasonably satisfactory
          to the Trustee,  the due and punctual  payment of the principal of and
          premium, if any and interest  (including  Additional Amounts, if any),
          on all the  Securities  and the  performance of every covenant of this
          Indenture on the part of the Guarantor to be performed or observed;

               (3) at the time of consummation of such transaction,  no Event of
          Default,  and no event  which,  after notice or lapse of time or both,
          would  become  an  Event  of  Default,  shall  have  happened  and  be
          continuing; and

               (4)  the  Guarantor  shall  have  delivered  to  the  Trustee  an
          Officers'  Certificate  and an Opinion of Counsel,  each  stating that
          such consolidation,  merger,  conveyance,  transfer or lease and, if a
          supplemental   indenture   is   required  in   connection   with  such
          transaction, such supplemental indenture, comply with this Article and
          that all  conditions  precedent  herein  provided for relating to such
          transaction have been complied with.

         Section 6.12  Successor Corporation Substituted.

          Upon any  consolidation or merger by the Company or the Guarantor with
or into  any  other  corporation  or any  conveyance,  transfer  or lease of the
properties  and  assets of the  Company  or the  Guarantor  substantially  as an
entirety  to  any  Person,   in  accordance  with  Section  6.1,  the  successor
corporation  formed by such consolidation or into which the Company or Guarantor
is merged or to which such  conveyance,  transfer or lease is made shall succeed
to, and be  substituted  for,  and may  exercise  every  right and power of, the
Company or the Guarantor  under this  Indenture  with the same effect as if such
successor  corporation  had been named as the Company or Guarantor  herein,  and
thereafter,  except in the case of a lease to another  Person,  the  predecessor
corporation  shall be  relieved  of all  obligations  and  covenants  under this
Indenture and the Securities.

                                       48

<PAGE>

                                   Article VII

                       AMENDMENTS, SUPPLEMENTS AND WAIVERS

     Section 7.1   Without    Consent   of   Holders   of   Securities.

          Without the consent of any Holders of  Securities,  the Company,  when
authorized by a Board Resolution,  and the Trustee, at any time and from time to
time, may jointly amend this Indenture and the Securities to:

          (a) add to the covenants of the Company for the benefit of the Holders
of Securities;

          (b) surrender any right or power herein conferred upon the Company;

          (c)  provide  for the  conversion  rights  of  Holders  of  Securities
pursuant to Article 12 if any reclassification or change of the Common Shares or
any  consolidation,  merger or sale of all or substantially all of the Company's
assets occurs;

          (d) provide for the  assumption  of the Company's  obligations  to the
Holders  of  Securities  in the  case of a  merger,  consolidation,  conveyance,
transfer or lease pursuant to Article 6;

          (e)  reduce  the  Conversion  Price;  provided,   however,  that  such
reduction in the Conversion Price shall not adversely affect the interest of the
Holders of Securities  (after taking into account tax and other  consequences of
such reduction);

          (f)  comply  with the  requirements  of the SEC in order to  effect or
maintain the qualification of this Indenture under the TIA;

          (g) make any changes or modifications  to this Indenture  necessary in
connection with the  registration of any Securities  under the Securities Act as
contemplated in the Registration Rights Agreement;  provided, however, that such
action  pursuant to this  clause (g) does not, in the good faith  opinion of the
Board of Directors of the Company (as evidenced by a Board  Resolution)  and the
Trustee,  adversely  affect the  interests of the Holders of  Securities  in any
material respect;

          (h) cure any ambiguity,  to correct or supplement any provision herein
which may be inconsistent  with any other provision herein or which is otherwise
defective,  or to make any other provisions with respect to matters or questions
arising  under  this  Indenture  which  the  Company  and the  Trustee  may deem
necessary or desirable and which shall not be  inconsistent  with the provisions
of this Indenture;  provided,  however, that such action pursuant to this clause
(h) does not, in the good faith opinion of the Board of Directors of the Company
(as  evidenced  by a Board  Resolution)  and the Trustee,  adversely  affect the
interests of the Holders of Securities in any material respect; or

                                       49

<PAGE>

          (i) add or modify  any other  provisions  with  respect  to matters or
questions  arising  under this  Indenture  which the Company and the Trustee may
deem  necessary  or  desirable  and  which  shall not be  inconsistent  with the
provisions of this Indenture;  provided,  however,  that such action pursuant to
this clause (i) does not, in the good faith opinion of the Board of Directors of
the Company (as  evidenced by a Board  Resolution)  and the  Trustee,  adversely
affect the interests of the Holders of Securities in any material respect.

     Section 7.2  With Consent of Holders of Securities.

          Except as provided  below in this Section 7.2,  this  Indenture or the
Securities may be amended or supplemented,  and  noncompliance in any particular
instance with any provision of this  Indenture or the  Securities may be waived,
in each case (i) with the written  consent of the Holders of at least a majority
in  aggregate  principal  amount of the  Outstanding  Securities  or (ii) by the
adoption of a resolution,  at a meeting of Holders of the Outstanding Securities
at  which a quorum  is  present,  by the  Holders  of a  majority  in  aggregate
principal amount of the Outstanding Securities represented at such meeting.

          Without the written consent or the affirmative  vote of each Holder of
Securities  affected thereby,  an amendment or waiver under this Section 7.2 may
not:

               (A) change the Maturity of the principal  of, or any  installment
          of interest (including Additional Amounts, if any) on, any Security;

               (B) reduce the  principal  amount of, or premium,  if any, on any
          Security;

               (C) reduce the Interest  Rate or interest  (including  Additional
          Amounts, if any) on any Security;

               (D) change the currency of payment of principal of,  premium,  if
          any,  or  interest  (including  Additional  Amounts,  if  any)  on any
          Security;

               (E)  impair  the right of any  Holder to  institute  suit for the
          enforcement of any payment on or with respect to any Security;

               (F) modify the obligation of the Company to maintain an office or
          agency in The City of New York pursuant to Section 9.2;

               (G) except as permitted by Section  12.11,  adversely  affect the
          Repurchase  Right or the right to convert any  Security as provided in
          Article 12;

               (H)  modify  the   provisions  in  Article  10  relating  to  the
          redemption  of the  Securities  in a manner  adverse to the Holders of
          Securities;

               (I) modify the provisions in Article 13 relating to the Guarantee
          in a manner adverse to the Holders of Securities;

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<PAGE>

               (J)  modify  the   provisions  in  Article  14  relating  to  the
          subordination  provisions of the Securities in a manner adverse to the
          Holders of Securities;

               (K) modify any of the  provisions of this  Section,  Section 4.4,
          Section  15.11 or Section  15.12,  except to increase  any  percentage
          contained   herein  or  therein  or  to  provide  that  certain  other
          provisions of this Indenture  cannot be modified or waived without the
          consent of the Holder of each Outstanding  Security  affected thereby;
          or

               (L) reduce the  requirements of Section 8.4 for quorum or voting,
          or  reduce  the  percentage  in  aggregate  principal  amount  of  the
          Outstanding  Securities  the consent of whose  Holders is required for
          any such  supplemental  indenture  or the consent of whose  Holders is
          required for any waiver provided for in this Indenture.

          It shall not be necessary for any Act of Holders of  Securities  under
this Section 7.2 to approve the  particular  form of any  proposed  supplemental
indenture,  but it shall be  sufficient  if such Act shall approve the substance
thereof.

     Section 7.3  Compliance with Trust Indenture Act.

          Every amendment to this Indenture or the Securities shall be set forth
in a supplemental indenture that complies with the TIA as then in effect.

     Section 7.4  Revocation of Consents and Effect of Consents or Votes.

          Until an amendment,  supplement or waiver becomes effective, a written
consent  to it by a Holder  is a  continuing  consent  by the  Holder  and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security, even if notation of the consent is not
made on any Security;  provided,  however,  that unless a record date shall have
been established, any such Holder or subsequent Holder may revoke the consent as
to its Security or portion of a Security if the Trustee  receives written notice
of  revocation  before  the date the  amendment,  supplement  or waiver  becomes
effective.

          An amendment, supplement or waiver becomes effective on receipt by the
Trustee of written  consents from or  affirmative  votes by, as the case may be,
the Holders of the  requisite  percentage of aggregate  principal  amount of the
Outstanding  Securities,  and thereafter  shall bind every Holder of Securities;
provided,  however,  if the  amendment,  supplement  or  waiver  makes a  change
described in any of the clauses (a) through (j) of Section  7.2, the  amendment,
supplement  or  waiver  shall  bind only each  Holder  of a  Security  which has
consented to it or voted for it, as the case may be, and every subsequent Holder
of a Security or portion of a Security that evidences the same  Indebtedness  as
the Security of the consenting or affirmatively  voting Holder,  as the case may
be.

     Section 7.5  Notation on or Exchange of Securities.

          If an amendment, supplement or waiver changes the terms of a Security:

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<PAGE>

          (A) the Trustee  may require the Holder of a Security to deliver  such
     Securities to the Trustee, the Trustee may place an appropriate notation on
     the  Security  about the changed  terms and return it to the Holder and the
     Trustee  may  place an  appropriate  notation  on any  Security  thereafter
     authenticated; or

          (B) if the Company so  determines,  the  Company in  exchange  for the
     Security shall issue and the Trustee shall authenticate a new Security that
     reflects the changed terms.

          Failure to make the appropriate notation or issue a new Security shall
not affect the validity and effect of such amendment, supplement or waiver.

     Section 7.6  Trustee to Sign Amendment, Etc.

          The  Trustee  shall sign any  amendment  authorized  pursuant  to this
Article 7 if the amendment does not adversely affect in any material respect the
rights, duties,  liabilities or immunities of the Trustee. If the amendment does
adversely  affect in any material  respect the rights,  duties,  liabilities  or
immunities of the Trustee,  the Trustee may but need not sign the amendment.  In
signing or refusing  to sign such  amendment,  the Trustee  shall be entitled to
receive and shall be fully  protected in relying  upon an Officers'  Certificate
and an  Opinion  of  Counsel  as  conclusive  evidence  that such  amendment  is
authorized or permitted by this Indenture.

                                  Article VIII

                        MEETING OF HOLDERS OF SECURITIES

     Section 8.1  Purposes for Which Meetings May Be Called.

          A meeting of Holders of Securities  may be called at any time and from
time to time pursuant to this Article to make, give or take any request, demand,
authorization,  direction,  notice,  consent, waiver or other action provided by
this Indenture to be made, given or taken by Holders of Securities.

     Section 8.2  Call Notice and Place of Meetings.

          (a)  The  Trustee  may at  any  time  call a  meeting  of  Holders  of
Securities for any purpose specified in Section 8.1, to be held at such time and
at such place in The City of New York as may be  specified  in  accordance  with
this Section 8.2(a).  Notice of every meeting of Holders of Securities,  setting
forth the time and the place of such  meeting  and in  general  terms the action
proposed to be taken at such meeting,  shall be given, in the manner provided in
Section  15.2,  not less than 21 nor more than 180 days  prior to the date fixed
for the meeting.

          (b) In case at any time the Company,  pursuant to a Board  Resolution,
or the Holders of at least 10% in principal amount of the Outstanding Securities
shall have  requested the Trustee to call a meeting of the Holders of Securities
for any purpose  specified in Section 8.1, by written  request  setting forth in
reasonable  detail  the  action  proposed  to be taken at the  meeting,  and the
Trustee shall not have made the first  publication of the notice of such meeting
within 21

                                       52

<PAGE>

days after receipt of such request or shall not thereafter  proceed to cause the
meeting  to be held as  provided  herein,  then the  Company  or the  Holders of
Securities in the amount  specified,  as the case may be, may determine the time
and the place in The City of New York for such meeting and may call such meeting
for such purposes by giving notice  thereof as provided in paragraph (a) of this
Section 8.2.

     Section 8.3  Persons Entitled to Vote at Meetings.

          To be  entitled  to vote at any  meeting of Holders of  Securities,  a
Person  shall be (a) a Holder of one or more  Outstanding  Securities,  or (b) a
Person appointed by an instrument in writing as proxy for a Holder or Holders of
one or more Outstanding  Securities by such Holder or Holders.  The only Persons
who shall be entitled to be present or to speak at any meeting of Holders  shall
be the  Persons  entitled  to  vote at  such  meeting  and  their  counsel,  any
representatives  of the Trustee and its counsel and any  representatives  of the
Company and its counsel.

     Section 8.4  Quorum; Action.

          The Persons  entitled to vote a majority  in  principal  amount of the
Outstanding  Securities  shall  constitute a quorum.  In the absence of a quorum
within 30 minutes of the time appointed for any such meeting, the meeting shall,
if convened at the request of Holders of Securities,  be dissolved. In any other
case,  the  meeting  may be  adjourned  for a period of not less than 10 days as
determined  by the  chairman of the  meeting  prior to the  adjournment  of such
meeting.  In the  absence  of a  quorum  at any  such  adjourned  meeting,  such
adjourned meeting may be further adjourned for a period of not less than 10 days
as determined by the chairman of the meeting  prior to the  adjournment  of such
adjourned  meeting.  Notice of the reconvening of any adjourned meeting shall be
given as provided in Section 8.2(a),  except that such notice need be given only
once and not less  than  five days  prior to the date on which  the  meeting  is
scheduled to be reconvened.  Notice of the  reconvening of an adjourned  meeting
shall state expressly the percentage of the principal  amount of the Outstanding
Securities which shall constitute a quorum.

          Subject to the foregoing,  at the reconvening of any meeting adjourned
for a lack of a quorum,  the Persons entitled to vote 25% in principal amount of
the Outstanding  Securities at the time shall constitute a quorum for the taking
of any action set forth in the notice of the original meeting.

          At a meeting or an adjourned  meeting duly  reconvened  and at which a
quorum is  present as  aforesaid,  any  resolution  and all  matters  (except as
limited by the proviso to Section 7.2) shall be  effectively  passed and decided
if passed or decided by the Persons entitled to vote not less than a majority in
principal  amount  of  Outstanding  Securities  represented  and  voting at such
meeting.

          Any resolution  passed or decisions taken at any meeting of Holders of
Securities duly held in accordance with this Section shall be binding on all the
Holders of Securities, whether or not present or represented at the meeting.

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     Section 8.5  Determination  of Voting  Rights;  Conduct and  Adjournment of
Meetings.

          (a)  Notwithstanding  any  other  provisions  of this  Indenture,  the
Trustee may make such  reasonable  regulations  as it may deem advisable for any
meeting of Holders of Securities in regard to proof of the holding of Securities
and of the appointment of proxies and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates and
other  evidence  of the right to vote,  and such other  matters  concerning  the
conduct  of the  meeting  as it shall  deem  appropriate.  Except  as  otherwise
permitted or required by any such  regulations,  the holding of Securities shall
be proved in the manner  specified  in Section 15.4 and the  appointment  of any
proxy shall be proved in the manner  specified in Section 15.4. Such regulations
may provide that written instruments appointing proxies,  regular on their face,
may be presumed valid and genuine without the proof specified in Section 15.4 or
other proof.

          (b)  The  Trustee  shall,  by an  instrument  in  writing,  appoint  a
temporary chairman (which may be the Trustee) of the meeting, unless the meeting
shall have been called by the Company or by Holders of Securities as provided in
Section 8.2(b),  in which case the Company or the Holders of Securities  calling
the  meeting,  as the case may be,  shall in like  manner  appoint  a  temporary
chairman. A permanent chairman and a permanent secretary of the meeting shall be
elected by vote of the Persons  entitled to vote a majority in principal  amount
of the Outstanding Securities represented at the meeting.

          (c) At any  meeting,  each  Holder  of a  Security  or proxy  shall be
entitled  to one vote for each $1,000  principal  amount of  Securities  held or
represented by him; provided,  however, that no vote shall be cast or counted at
any meeting in respect of any Security  challenged as not  Outstanding and ruled
by the  chairman  of the  meeting to be not  Outstanding.  The  chairman  of the
meeting shall have no right to vote, except as a Holder of a Security or proxy.

          (d) Any  meeting of Holders of  Securities  duly  called  pursuant  to
Section 8.2 at which a quorum is present may be  adjourned  from time to time by
Persons  entitled  to vote a majority  in  principal  amount of the  Outstanding
Securities  represented  at the  meeting,  and  the  meeting  may be  held as so
adjourned without further notice.

     Section 8.6  Counting Votes and Recording Action of Meetings.

          The vote upon any  resolution  submitted  to any meeting of Holders of
Securities  shall be by  written  ballots  on  which  shall  be  subscribed  the
signatures of the Holders of Securities or of their representatives by proxy and
the principal  amounts and serial numbers of the Outstanding  Securities held or
represented  by them.  The  permanent  chairman of the meeting shall appoint two
inspectors of votes who shall count all votes cast at the meeting for or against
any  resolution  and who shall make and file with the  secretary  of the meeting
their verified written reports in duplicate of all votes cast at the meeting.  A
record, at least in duplicate,  of the proceedings of each meeting of Holders of
Securities  shall be prepared by the secretary of the meeting and there shall be
attached to said record the original  reports of the  inspectors of votes on any
vote by ballot  taken  thereat  and  affidavits  by one or more  Persons  having
knowledge  of the facts  setting  forth a copy of the notice of the  meeting and
showing  that  said  notice

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<PAGE>

was given as provided in Section 8.2 and, if applicable,  Section 8.4. Each copy
shall be signed and verified by the  affidavits  of the  permanent  chairman and
secretary of the meeting and one such copy shall be delivered to the Company and
another  to the  Trustee  to be  preserved  by the  Trustee,  the latter to have
attached  thereto the  ballots  voted at the  meeting.  Any record so signed and
verified shall be conclusive evidence of the matters therein stated.

                                   Article IX

                                    COVENANTS

          Section 9.1  Payment of Principal, Premium and Interest.

          The Company will duly and punctually pay the principal of and premium,
if any, and interest  (including  Additional  Amounts, if any) in respect of the
Securities in accordance  with the terms of the Securities  and this  Indenture.
The Company will  deposit or cause to be deposited  with the Trustee as directed
by the Trustee,  no later than the day of the Stated Maturity of any Security or
installment of interest (including  Additional Amounts, if any), all payments so
due.

     Section 9.2  Maintenance of Offices or Agencies.

          The Company hereby appoints the Trustee's  Corporate Trust Office,  or
the office or agency of the Trustee's  correspondent in The City of New York, as
its office in The City of New York, where Securities may be:

          (i) presented or surrendered for payment;

         (ii) surrendered for registration of transfer or exchange;

        (iii) surrendered for conversion;

and  where  notices  and  demands  to or upon  the  Company  in  respect  of the
Securities and this Indenture may be served.

          The  Company  may at any time and from time to time vary or  terminate
the appointment of any such office or appoint any additional  offices for any or
all of such purposes;  provided,  however, that until all of the Securities have
been delivered to the Trustee for cancellation,  or monies sufficient to pay the
principal of and premium, if any, and interest (including Additional Amounts, if
any) on the  Securities  have been made available for payment and either paid or
returned to the Company  pursuant to the  provisions of Section 3.3, the Company
will maintain in The City of New York, an office or agency where  Securities may
be presented or surrendered for payment, where Securities may be surrendered for
registration  of transfer or exchange,  where  Securities may be surrendered for
conversion  and where  notices  and demands to or upon the Company in respect of
the Securities  and this  Indenture may be served.  The Company will give prompt
written  notice to the  Trustee,  and notice to the Holders in  accordance  with
Section 15.2, of the  appointment  or  termination of any such agents and of the
location and any change in the location of any such office or agency.

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<PAGE>

          If at any time the Company  shall fail to maintain  any such  required
office or agency in The City of New York,  or shall fail to furnish  the Trustee
with the  address  thereof,  presentations  and  surrenders  may be made at, and
notices and demands may be served on, the Corporate Trust Office of the Trustee,
or the office or agency of the Trustee's correspondent in New York City.

     Section 9.3  Corporate Existence.

          Subject  to  Article  6, the  Company  will do or cause to be done all
things  necessary  to preserve  and keep in full force and effect its  corporate
existence,  rights  (charter and statutory) and franchises;  provided,  however,
that the Company  shall not be required to preserve  any such right or franchise
if the Company  determines that the preservation  thereof is no longer desirable
in the conduct of the  business of the Company and that the loss  thereof is not
disadvantageous in any material respect to the Holders.

     Section 9.4  Reports.

          (a) The Company shall  deliver to the Trustee  within 15 days after it
files  them with the SEC copies of the annual  reports  and of the  information,
documents, and other reports (or copies of such portions of any of the foregoing
as the SEC may by rules and regulations prescribe) which the Company is required
to file  with the SEC  pursuant  to  Section  13 or 15(d) of the  Exchange  Act;
provided,  however,  the Company shall not be required to deliver to the Trustee
any  materials  for which the  Company  has  sought  and  received  confidential
treatment by the SEC. The Company also shall comply with the other provisions of
Section 314(a) of the TIA.

          Delivery of such reports,  information and documents to the Trustee is
for  informational  purposes  only and the  Trustee's  receipt of such shall not
constitute   constructive  notice  of  any  information   contained  therein  or
determinable  from  information  contained  therein,   including  the  Company's
compliance  with any of its  covenants  hereunder  (as to which the  Trustee  is
entitled to rely exclusively on Officers' Certificates).

          (b) If at any time the  Company is not  subject to Section 13 or 15(d)
of the  Exchange  Act,  upon the request of a Holder of a Security,  the Company
will  promptly  furnish  or  cause  to  be  furnished  to  such  Holder  or to a
prospective  purchaser of such Security  designated by such Holder,  as the case
may be, the information, if any, required to be delivered by it pursuant to Rule
144A(d)(4)  under  the  Securities  Act to permit  compliance  with Rule 144A in
connection with the resale of such Security; provided, however, that the Company
shall not be required to furnish such information in connection with any request
made on or after  the date  which is two  years  from the later of the date such
security was last acquired from the Company or an "affiliate"  (as defined under
Rule 144 under the Securities Act) of the Company.

     Section 9.5  Compliance Certificate.

          The Company  shall  deliver to the Trustee,  within 120 days after the
end of each fiscal year of the Company  (which as of the date hereof is December
31), an Officers'  Certificate  stating that in the course of the performance by
the signers of their duties as Officers of the

                                       56

<PAGE>

Company,  they would  normally  have  knowledge of any failure by the Company to
comply with all  conditions,  or any Default by the Company  with respect to any
covenants,  under this  Indenture,  and further stating whether or not they have
knowledge  of any such  failure  or Default  and,  if so,  specifying  each such
failure or Default and the nature thereof.

          The Company shall  deliver to the Trustee,  as soon as possible and in
any event within five days after the Company  becomes aware of the occurrence of
any Event of  Default  or an event  which,  with  notice or the lapse of time or
both, would  constitute an Event of Default,  an Officers'  Certificate  setting
forth the details of such Event of Default or default  and the action  which the
Company proposes to take with respect thereto.

     Section 9.6  Resale of Certain Securities.

          During  the  period  of two  years  after  the last  date of  original
issuance of any  Securities,  the Company shall not, and shall not permit any of
its "affiliates" (as defined under Rule 144 under the Securities Act) to, resell
any  Securities,  or Common Shares  issuable upon  conversion of the Securities,
which constitute  "restricted  securities"  under Rule 144, that are acquired by
any of them,  within  the  United  States or to "U.S.  persons"  (as  defined in
Regulation S) except pursuant to an effective  registration  statement under the
Securities Act or an applicable exemption  therefrom.  The Trustee shall have no
responsibility  or  liability  in respect of the  Company's  performance  of its
agreement in the preceding sentence.

                                    Article X

                            REDEMPTION OF SECURITIES

     Section 10.1  Optional Redemption.

          At any time on or after June 1, 2004,  the Company  may, at its option
and so long as the Trading Price of the Common Shares (multiplied by 100) equals
or exceeds 120% of the then prevailing  Conversion  Price (as defined in Section
12.1) for at least 20 Trading Days in any  consecutive  30-day  trading  period,
including the last Trading Day of such 30-day period,  ending on the Trading Day
prior to the issuance of the Notice of  Redemption  announcing  such  redemption
referred to in Section 10.4, redeem the Securities in whole or from time to time
in part,  on any date  prior to  maturity,  upon  notice as set forth in Section
10.4, at the Redemption Price (expressed as percentages of the principal amount)
set forth below if redeemed on a Redemption  Date occurring  during the 12-month
period  beginning  June  1 of  the  years  indicated  and  ending  May 31 of the
following year:

               During the Twelve Months Commencing          Redemption Price
               -----------------------------------          ----------------
                          June 1, 2004                           103.90%
                          June 1, 2005                           102.60%
                          June 1, 2006                           101.30%

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<PAGE>

plus any interest (including Additional Amounts, if any) accrued and unpaid to,
but excluding, the Redemption Date.

     Section 10.2.  Notice to Trustee.

          If the Company elects to redeem Securities  pursuant to the provisions
of  Section  10.1,  it shall  notify  the  Trustee at least 30 days prior to the
intended  Redemption  Date  of (i)  such  intended  Redemption  Date,  (ii)  the
principal amount of Securities to be redeemed and (iii) the CUSIP numbers of the
Securities to be redeemed.

     Section 10.3.  Selection of Securities to Be Redeemed.

          If fewer than all the Securities are to be redeemed, the Trustee shall
select the particular Securities to be redeemed from the Outstanding  Securities
by a method that  complies  with the  requirements  of any exchange on which the
Securities are listed, or, if the Securities are not listed on an exchange, on a
pro rata basis or by lot or in  accordance  with any other  method  the  Trustee
considers fair and appropriate. Securities and portions thereof that the Trustee
selects shall be in amounts equal to the minimum  authorized  denominations  for
Securities to be redeemed or any integral multiple thereof.

          If any  Security  selected  for partial  redemption  is  converted  or
elected to be repurchased in part before  termination of the conversion right or
repurchase  right with respect to the portion of the  Security so selected,  the
converted  or  repurchased  portion of such  Security  shall be deemed to be the
portion  selected for  redemption;  provided,  however,  that the Holder of such
Security  so  converted  and  deemed  redeemed  shall  not  be  entitled  to any
additional  interest  payment as a result of such  deemed  redemption  than such
Holder would have  otherwise  been  entitled to receive upon  conversion of such
Security.  Securities which have been converted during a selection of Securities
to be redeemed may be treated by the Trustee as  Outstanding  for the purpose of
such selection.

          The Trustee  shall  promptly  notify the Company and the  Registrar in
writing  of the  Securities  selected  for  redemption  and,  in the case of any
Securities selected for partial  redemption,  the principal amount thereof to be
redeemed.

          For all  purposes  of this  Indenture,  unless the  context  otherwise
requires,  all provisions relating to the redemption of Securities shall relate,
in the case of any  Securities  redeemed or to be redeemed  only in part, to the
portion of the principal  amount of such  Securities  which has been or is to be
redeemed.

     Section 10.4.  Notice of Redemption.

          Notice of redemption  shall be given in the manner provided in Section
15.2 to the Holders of Securities to be redeemed. Such notice shall be given not
less than 20 nor more than 60 days prior to the intended Redemption Date.

          All notices of redemption shall state:

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<PAGE>

          (A) such intended Redemption Date;

               (1) the  Redemption  Price  and  interest  (including  Additional
          Amounts, if any) accrued and unpaid to, but excluding,  the Redemption
          Date, if any;

               (2) if  fewer  than  all  the  Outstanding  Securities  are to be
          redeemed,  the aggregate principal amount of Securities to be redeemed
          and  the  aggregate  principal  amount  of  Securities  which  will be
          Outstanding after such partial redemption;

               (3) that on the Redemption Date the Redemption Price and interest
          accrued and unpaid to, but  excluding,  the  Redemption  Date, if any,
          will become due and payable  upon each such  Security to be  redeemed,
          and that interest (including Additional Amounts, if any) thereon shall
          cease to accrue on and after such date;

               (4) the Conversion  Price, the date on which the right to convert
          the principal of the  Securities to be redeemed will terminate and the
          places where such Securities may be surrendered for conversion;

               (5)  the  place  or  places  where  such  Securities  are  to  be
          surrendered for payment of the Redemption Price and accrued and unpaid
          interest, if any; and

               (6) the CUSIP number of the Securities.

          The notice  given shall  specify the last date on which  exchanges  or
transfers of  Securities  may be made pursuant to Section 2.7, and shall specify
the serial numbers of Securities and the portions thereof called for redemption.

          Notice of  redemption  of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's  written  request
delivered  at least 15 days  prior to the  date of the  mailing  of such  Notice
(unless a shorter period shall be acceptable to the Trustee),  by the Trustee in
the name of and at the expense of the Company.

     Section 10.5  Effect of Notice of Redemption.

          Notice of  redemption  having been given as provided in Section  10.4,
the  Securities to be redeemed  shall,  on the Redemption  Date,  become due and
payable at the Redemption  Price therein  specified and from and after such date
(unless the Company  shall  default in the payment of the  Redemption  Price and
accrued and unpaid interest) such Securities shall cease to bear interest.  Upon
surrender of any such Security for  redemption  in accordance  with such notice,
such Security  shall be paid by the Company at the Redemption  Price;  provided,
however,  the  installments  of interest on Securities  whose Stated Maturity is
prior to or on the  Redemption  Date  shall be  payable  to the  Holders of such
Securities,  or one or more  Predecessor  Securities,  registered as such on the
relevant Record Date according to their terms and the provisions of Section 2.7.

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<PAGE>

          If any  Security  called  for  redemption  shall  not be so paid  upon
surrender  thereof for  redemption,  the principal and premium,  if any,  shall,
until paid, bear interest from the Redemption Date at the Interest Rate.

     Section 10.6  Deposit of Redemption Price.

          Prior to or on any Redemption Date, the Company shall deposit with the
Trustee  or with a  Paying  Agent  an  amount  of  money  sufficient  to pay the
Redemption Price and accrued and unpaid interest (including  Additional Amounts,
if any),  in respect of all the  Securities  to be redeemed  on that  Redemption
Date,  other than any  Securities  called for redemption on that date which have
been converted prior to the date of such deposit.

          If  any  Security  called  for  redemption  is  converted,  any  money
deposited  with the Trustee or with a Paying Agent or so segregated  and held in
trust for the  redemption  of such Security  shall  (subject to any right of the
Holder of such  Security  or any  Predecessor  Security  to receive  interest as
provided in Section  2.1(e)) be paid to the Company  upon request by the Company
or, if then held by the Company, shall be discharged from such trust.

     Section 10.7  Securities Redeemed in Part.

          Any Security which is to be redeemed only in part shall be surrendered
at an office or agency of the Company  designated  for that purpose  pursuant to
Section 9.2 (with,  if the Company or the Trustee so requires,  due  endorsement
by, or a written  instrument of transfer in form satisfactory to the Company and
the Trustee duly executed by, the Holder  thereof or the Holder's  attorney duly
authorized  in writing),  and the Company shall  execute,  and the Trustee shall
authenticate  and deliver to the Holder of such Security without service charge,
a new Security or Securities of any authorized denomination as requested by such
Holder in aggregate principal amount equal to and in exchange for the unredeemed
portion of the principal of the Security so surrendered.

                                   Article XI

                      REPURCHASE AT THE OPTION OF A HOLDER

     Section 11.1  Repurchase Rights.

          (a) In the event that a Change in Control  shall  occur,  each  Holder
shall  have the right (the  "Repurchase  Right"),  at the  Holder's  option,  to
require  the  Company to  repurchase,  and upon the  exercise  of such right the
Company shall repurchase, all of such Holder's Securities not theretofore called
for redemption,  or any portion of the principal amount thereof that is equal to
any  integral  multiple  of  $1,000  (provided  that no single  Security  may be
repurchased in part unless the portion of the principal  amount of such Security
to be  Outstanding  after such  repurchase  is equal to an integral  multiple of
$1,000),  on the date (the "Repurchase  Date") that is 45 days after the date of
the Company Notice given pursuant to Section 11.2 in connection with such Change
of  Control  at the  100%  of the  principal  amount  of  the  Securities  to be
repurchased  (the  "Repurchase  Price"),  plus  interest  (including  Additional
Amounts,  if any) accrued and unpaid

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<PAGE>

to, but excluding, the Repurchase Date; provided,  however, that installments of
interest on Securities  whose Stated  Maturity is prior to or on the  Repurchase
Date  shall  be  payable  to the  Holders  of  such  Securities,  or one or more
Predecessor Securities, registered as such on the relevant Record Date according
to their terms and the provisions of Section 2.1.

          (b) Whenever in this  Indenture  (including  Sections 2.1,  4.1(a) and
4.7) or Exhibit A annexed  hereto there is a reference,  in any context,  to the
principal  of any  Security as of any time,  such  reference  shall be deemed to
include reference to the Repurchase Price payable in respect to such Security to
the  extent  that such  Repurchase  Price is, was or would be so payable at such
time,  and express  mention of the  Repurchase  Price in any  provision  of this
Indenture  shall not be  construed as excluding  the  Repurchase  Price in those
provisions of this Indenture when such express mention is not made.

     Section 11.2  Notices; Method of Exercising Repurchase Right, Etc.

          (a) Unless the Company shall have  theretofore  called for  redemption
all of the  Outstanding  Securities,  prior  to or on the  30th  day  after  the
occurrence of a Change in Control,  the Company,  or, at the written request and
expense of the Company  prior to or on the 30th day after such  occurrence,  the
Trustee,  shall give to all Holders of Securities notice, in the manner provided
in  Section  15.2,  of  the  occurrence  of the  Change  of  Control  and of the
Repurchase  Right set forth herein  arising as a result  thereof  (the  "Company
Notice").  The Company  shall also deliver a copy of such Company  Notice of the
Repurchase Right to the Trustee. Each Company Notice of a Repurchase Right shall
state:

               (1) the applicable Repurchase Date;

               (2) the date by which the Repurchase Right must be exercised;

               (3)  the  Repurchase   Price  and  accrued  and  unpaid  interest
          (including Additional Amounts, if any);

               (4) a description of the procedure  which a Holder must follow to
          exercise  its  Repurchase  Right,  and the place or places  where such
          Securities are to be surrendered  for payment of the Repurchase  Price
          and accrued and unpaid interest;

               (5) that on the applicable  Repurchase Date the Repurchase  Price
          and accrued and unpaid  interest,  will become due and payable in cash
          upon each such Security  designated  by the Holder to be  repurchased,
          and that  interest  thereon  shall  cease to accrue on and after  said
          date;

               (6) the  Conversion  Rate then in  effect,  the date on which the
          right  to  convert  the  principal  amount  of  the  Securities  to be
          repurchased  will terminate and the place where such Securities may be
          surrendered for conversion, and

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<PAGE>

               (7) the place or places where such Securities,  together with the
          Option to Elect  Repayment  certificate  included in Exhibit A annexed
          hereto are to be  delivered  for payment of the  Repurchase  Price and
          accrued and unpaid interest.

          No failure  of the  Company  to give the  foregoing  notices or defect
therein shall limit any Holder's right to exercise a Repurchase  Right or affect
the validity of the proceedings for the repurchase of Securities.

          If any of the foregoing provisions or other provisions of this Article
11 are inconsistent with applicable law, such law shall govern.

          (b) To exercise its  Repurchase  Right,  a Holder shall deliver to the
Trustee on or prior to the close of business  on the  Business  Day  immediately
preceding the Repurchase Date:

               (1) written notice of the Holder's exercise of such right,  which
          notice shall set forth the name of the Holder; the certificate numbers
          of the Securities to be delivered for  repurchase;  the portion of the
          principal  amount of the Securities to be  repurchased,  which portion
          must be $1,000 or an integral multiple of $1,000; that such Securities
          are  to be  repurchased  by the  Company  pursuant  to the  applicable
          provisions  of the  Securities;  and a  statement  that an election to
          exercise the applicable Repurchase Right is being made thereby; and

               (2) the Securities with respect to which the Repurchase  Right is
          being  exercised  (and, if any Security is to be  repurchased in part,
          the serial number  thereof,  and the portion of the  principal  amount
          thereof to be repurchased).

The right of the  Holder to convert  the  Securities  with  respect to which the
Repurchase  Right is being  exercised shall continue until the close of business
on the Business Day immediately  preceding the Repurchase  Date.

          (c) Each Holder may withdraw a repurchase  notice by delivering to the
Paying  Agent a notice  (the  "Notice  of  Withdrawal")  prior  to the  close of
business on the Business Day  immediately  preceding the  Repurchase  Date.  The
notice of withdrawal must state:

               (1) the  portion  of the  principal  amount of  Securities  being
          withdrawn;

               (2) the certificate  numbers of the Securities  being  withdrawn;
          and

               (3)  the  portion  of  the  principal  amount,  if  any,  of  the
          Securities that remains subject to the Repurchase Right.

          (d) In the event the Repurchase Right shall be exercised in accordance
with the terms hereof,  the Company shall pay or cause to be paid to the Trustee
the Repurchase  Price in cash, as provided  above,  for payment to the Holder on
the  Repurchase  Date,  together  with  accrued  and  unpaid  interest  to,  but
excluding, the Repurchase Date payable in cash with respect to the Securities as
to which  the  Repurchase  Right has been  exercised;  provided,  however,  that
installments of interest that mature prior to or on the Repurchase Date shall be
payable in cash to

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<PAGE>

the  Holders  of  such  Securities,  or  one  or  more  Predecessor  Securities,
registered as such at the close of business on the relevant Regular Record Date.

          (e) If any Security (or portion  thereof)  surrendered  for repurchase
shall  not be so paid on the  Repurchase  Date,  the  principal  amount  of such
Security  (or  portion  thereof,  as the case may be) shall,  until  paid,  bear
interest to the extent  permitted by applicable law from the Repurchase  Date at
the Interest Rate, and each Security shall remain convertible into Common Shares
until the  principal of such Security (or portion  thereof,  as the case may be)
shall have been paid or duly provided for.

          (f) Any  Security  which is to be  repurchased  only in part  shall be
surrendered to the Trustee (with, if the Company or the Trustee so requires, due
endorsement by, or a written  instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by the Holder thereof or his attorney duly
authorized  in writing),  and the Company shall  execute,  and the Trustee shall
authenticate  and make  available  for  delivery to the Holder of such  Security
without service charge, a new Security or Securities, containing identical terms
and conditions, each in an authorized denomination in aggregate principal amount
equal to and in exchange for the  unrepurchased  portion of the principal of the
Security so surrendered.

          (g) All Securities  delivered for repurchase shall be delivered to the
Trustee to be canceled at the  direction of the Trustee,  which shall dispose of
the same as provided in Section 2.15.

                                   Article XII

                            CONVERSION OF SECURITIES

     Section 12.1  Conversion Right and Conversion Price.

          Subject to and upon compliance with the provisions of this Article, at
the option of the Holder  thereof,  any Security or any portion of the principal
amount  thereof  which is a whole  multiple  of $1,000 may be  converted  at the
principal  amount thereof,  or of such portion  thereof,  into duly  authorized,
fully paid and  nonassessable  shares of Common Shares, at the Conversion Price,
determined as hereinafter  provided,  in effect at the time of conversion.  Such
conversion  right  shall  expire at the close of business  on the  Business  Day
immediately preceding June 1, 2007.

          In case a Security or portion thereof is called for  redemption,  such
conversion  right in respect of the  Security  or the  portion so called,  shall
expire at the  close of  business  on the  second  Business  Day  preceding  the
Redemption  Date,  unless the  Company  defaults  in making the payment due upon
redemption.  In the case of a Change of Control  for which the Holder  exercises
its  Repurchase  Right  with  respect to a Security  or  portion  thereof,  such
conversion  right in respect of the Security or portion  thereof shall expire at
the close of business on the Business Day  immediately  preceding the Repurchase
Date.

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          The price at which the shares of Common Shares shall be delivered upon
conversion  (the  "Conversion  Price")  shall be  initially  equal to $16.05 per
share. The Conversion  Price shall be adjusted in certain  instances as provided
in paragraphs (a), (b), (c), (d), (e), (f), and (h) of Section 12.4.

     Section 12.2 Exercise of Conversion Right.

          To exercise  the  conversion  right,  the Holder of any Security to be
converted shall surrender such Security duly endorsed or assigned to the Company
or in  blank,  at the  office of any  Conversion  Agent,  accompanied  by a duly
completed and signed conversion notice substantially in the form attached to the
Security (or a facsimile  thereof) to the Company stating that the Holder elects
to convert such Security or, if less than the entire principal amount thereof is
to be  converted,  the  portion  thereof  to be  converted  and pay all taxes or
duties, if any, described in Section 12.9.

          Securities surrendered for conversion during the period from the close
of business  on any  Regular  Record Date to the opening of business on the next
succeeding  Interest  Payment  Date  (except in the case of any  Security  whose
Maturity is prior to such Interest Payment Date) shall be accompanied by payment
in New York Clearing House funds or other funds  acceptable to the Company of an
amount equal to the interest to be received on such Interest Payment Date on the
principal amount of Securities being surrendered for conversion.

          Securities shall be deemed to have been converted immediately prior to
the close of business on the day of surrender of such  Securities for conversion
in accordance with the foregoing provisions,  and at such time the rights of the
Holders of such  Securities  as Holders  shall cease,  and the Person or Persons
entitled to receive the Common Shares issuable upon conversion  shall be treated
for all purposes as the record  holder or holders of such Common  Shares at such
time. As promptly as practicable  on or after the  conversion  date, the Company
shall cause to be issued and delivered to such Conversion Agent a certificate or
certificates  representing  the number of shares of Common Shares  issuable upon
conversion of such Securities,  together with payment in lieu of any fraction of
a share as provided in Section 12.3.

          In the case of any Security which is converted in part only, upon such
conversion  the Company  shall execute and the Trustee  shall  authenticate  and
deliver to the Holder thereof,  at the expense of the Company, a new Security or
Securities of authorized  denominations  in aggregate  principal amount equal to
the unconverted portion of the principal amount of such Securities.

          If  Common  Shares  to  be  issued  upon  conversion  of a  Restricted
Security, or Securities to be issued upon conversion of a Restricted Security in
part only,  are to be registered in a name other than that of the Holder of such
Restricted  Security,  such  Holder  must  deliver  to the  Conversion  Agent  a
certificate  in  substantially  the form set forth in the form of  Security  set
forth  in  Exhibit  A  annexed  hereto,  dated  the  date of  surrender  of such
Restricted  Security  and  signed  by such  Holder,  as to  compliance  with the
restrictions  on transfer  applicable to such Restricted  Security.  Neither the
Trustee nor any Conversion Agent,  Registrar or Transfer Agent shall be required
to  register  in a name other  than that of the  Holder of any Common Shares or

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Securities  issued  upon  conversion  of any  such  Restricted  Security  not so
accompanied by a properly completed certificate.

          The Company  hereby  initially  appoints the Trustee as the Conversion
Agent.

     Section 12.3  Fractions of Common Shares.

          No fractional  shares of Common Shares shall be issued upon conversion
of any Security or  Securities.  If more than one Security  shall be surrendered
for  conversion  at one time by the same  Holder,  the number of full  shares of
Common Shares which shall be issued upon conversion thereof shall be computed on
the basis of the  aggregate  principal  amount of the  Securities  (or specified
portions  thereof) so surrendered.  Instead of any fractional shares which would
otherwise be issued upon  conversion of any Security or Securities (or specified
portions  thereof),  the Company shall pay a cash  adjustment in respect of such
fraction  (calculated to the nearest one-100th of a share) in an amount equal to
the same  fraction of the Trading  Price of the Common  Shares as of the Trading
Day preceding the date of conversion.

     Section 12.4  Adjustment of Conversion Price.

          The Conversion Price shall be subject to adjustment, calculated by the
Company, from time to time as follows:

          (a) In case the  Company  shall  hereafter  pay a  dividend  or make a
distribution to all holders of the  outstanding  Common Shares in Common Shares,
the Conversion  Price in effect at the opening of business on the date following
the date fixed for the  determination  of stockholders  entitled to receive such
dividend or other  distribution  shall be reduced by multiplying such Conversion
Price by a fraction:

               (1) the  numerator  of which  shall be the  number  of  shares of
          Common Shares  outstanding at the close of business on the Record Date
          (as defined in Section 12.4(g)) fixed for such determination; and

               (2) the  denominator  of which shall be the sum of such number of
          shares and the total number of shares  constituting  such  dividend or
          other distribution.

Such reduction shall become effective  immediately after the opening of business
on the day  following the Record Date.  If any dividend or  distribution  of the
type described in this Section  12.4(a) is declared but not so paid or made, the
Conversion  Price shall again be  adjusted to the  Conversion  Price which would
then be in effect if such dividend or distribution had not been declared.

          (b) In case the  outstanding  Common Shares shall be subdivided into a
greater  number of  shares,  the  Conversion  Price in effect at the  opening of
business  on the day  following  the day upon  which  such  subdivision  becomes
effective shall be proportionately reduced, and conversely,  in case outstanding
Common Shares shall be combined into a smaller number of shares,  the Conversion
Price in effect at the  opening of business  on the day  following  the day upon
which such combination  becomes  effective shall be  proportionately  increased,

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<PAGE>

such reduction or increase,  as the case may be, to become effective immediately
after the  opening  of  business  on the day  following  the day upon which such
subdivision or combination becomes effective.

          (c) In case the Company shall issue rights or warrants (other than any
rights  or  warrants  referred  to in  Section  12.4(d)  to all  holders  of its
outstanding  Common Shares  entitling  them to subscribe for or purchase  Common
Shares (or securities  convertible  into Common Shares) at a price per share (or
having a  conversion  price per share)  less than the Current  Market  Price (as
defined in Section  12.4(g)) on the Record Date fixed for the  determination  of
stockholders  entitled to receive such rights or warrants,  the Conversion Price
shall  be  adjusted  so that  the same  shall  equal  the  price  determined  by
multiplying  the  Conversion  Price in effect at the  opening of business on the
date after such Record Date by a fraction:

               (1) the  numerator  of which  shall be the  number  of  shares of
          Common Shares outstanding at the close of business on the Record Date,
          plus the number of shares which the  aggregate  offering  price of the
          total number of shares so offered for subscription or purchase (or the
          aggregate  conversion price of the convertible  securities so offered)
          would purchase at such Current Market Price; and

               (2) the  denominator  of which  shall be the  number of shares of
          Common Shares outstanding on the close of business on the Record Date,
          plus the total number of additional shares so offered for subscription
          or purchase (or into which the  convertible  securities so offered are
          convertible).

          Such adjustment shall become effective  immediately  after the opening
of business on the day  following  the Record  Date fixed for  determination  of
stockholders  entitled to receive  such rights or  warrants.  To the extent that
Common Shares (or  securities  convertible  into Common Shares) is not delivered
pursuant to such rights or warrants,  upon the expiration or termination of such
rights or warrants,  the Conversion  Price shall be readjusted to the Conversion
Price which would then be in effect had the  adjustments  made upon the issuance
of such  rights or warrants  been made on the basis of the  delivery of only the
number of  shares  (or  securities  convertible  into  Common  Shares)  actually
delivered.  In the event that such  rights or  warrants  are not so issued,  the
Conversion  Price shall again be adjusted to be the Conversion Price which would
then be in effect  if such date  fixed  for the  determination  of  stockholders
entitled to receive such rights or warrants had not been fixed.  In  determining
whether any rights or warrants  entitle the holders to subscribe for or purchase
Common Shares at less than such Current  Market Price,  and in  determining  the
aggregate  offering  price of such  Common  Shares,  there  shall be taken  into
account any  consideration  received for such rights or  warrants,  the value of
such  consideration  if  other  than  cash,  to be  determined  by the  Board of
Directors.

          (d) In case the Company shall, by dividend or otherwise, distribute to
all  holders of its Common  Shares of any class of capital  stock of the Company
(other than any dividends or  distributions to which Section 12.4(a) applies) or
evidences of its Indebtedness,  cash or other assets, including securities,  but
excluding  (1) any  rights or  warrants  referred  to in  Section  12.4(c),  (2)
dividends or  distributions  of stock,  securities  or other  property or assets
(including  cash)  in  connection  with  a  reclassification,   change,  merger,
consolidation,  statutory  share

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<PAGE>

exchange,  combination, sale or conveyance to which Section 12.11 applies or (3)
any dividends and  distributions  paid  exclusively in cash (such capital stock,
evidence of its Indebtedness, cash, other assets or securities being distributed
hereinafter in this Section 12.4(d) called the "distributed  assets"),  then, in
each such  case,  subject  to the third  succeeding  paragraph  of this  Section
12.4(d),  the Conversion  Price shall be reduced so that the same shall be equal
to  the  price   determined  by  multiplying  the  Conversion  Price  in  effect
immediately  prior to the close of  business  on the Record  Date (as defined in
Section 12.4(g)) with respect to such distribution by a fraction:

               (1) the  numerator  of which  shall be the Current  Market  Price
          (determined  as  provided in Section  12.4(g)) on such date,  less the
          fair market  value (as  determined  by the Board of  Directors,  whose
          determination shall be conclusive and set forth in a Board Resolution)
          on such date of the portion of the  distributed  assets so distributed
          applicable to one share of Common Shares  (determined  on the basis of
          the number of shares outstanding on the Record Date); and

               (2) the denominator of which shall be such Current Market Price.

Such  reduction  shall  become  effective  immediately  prior to the  opening of
business on the day  following the Record Date.  However,  in the event that the
then fair market  value (as so  determined)  of the  portion of the  distributed
assets so  distributed  applicable  to one share of Common Shares is equal to or
greater  than the  Current  Market  Price  on the  Record  Date,  in lieu of the
foregoing adjustment, adequate provision shall be made so that each Holder shall
have the right to receive upon conversion of a Security (or any portion thereof)
the amount of distributed assets such Holder would have received had such Holder
converted such Security (or portion  thereof)  immediately  prior to such Record
Date.  In the event that such dividend or  distribution  is not so paid or made,
the Conversion  Price shall again be adjusted to be the  Conversion  Price which
would then be in effect if such dividend or distribution had not been declared.

          If the Board of  Directors  determines  the fair  market  value of any
distribution  for purposes of this Section 12.4(d) by reference to the actual or
when issued trading market for any distributed  assets comprising all or part of
such  distribution,  it must in doing so consider the prices in such market over
the same period (the  "Reference  Period") used in computing the Current  Market
Price pursuant to Section  12.4(g) to the extent  possible,  unless the Board of
Directors in a Board  Resolution  determines in good faith that  determining the
fair market value during the Reference  Period would not be in the best interest
of the Holders.

          In the event any such distribution consists of shares of capital stock
of, or similar equity interests in, one or more of the Company's Subsidiaries or
other business units (a "Spin-Off"),  the fair market value of the securities to
be distributed shall equal the average of Trading Prices of those securities for
the five  consecutive  Trading Days commencing on and including the sixth day of
trading of those  securities after the  effectiveness  of the Spin-Off,  and the
Current  Market  Price  shall be  measured  for the same  period.  In the event,
however,  that an underwritten  initial public offering

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<PAGE>

of the securities in the Spin-Off occurs  simultaneously with the Spin-Off,  the
fair market value of the  securities  distributed in the Spin-Off shall mean the
initial public  offering  price of such  securities and the Current Market Price
shall mean the Trading Price for the Common Shares on the same Trading Day

          Rights or warrants distributed by the Company to all holders of Common
Shares  entitling the holders thereof to subscribe for or purchase shares of the
Company's capital stock (either initially or under certain circumstances), which
rights  or  warrants,  until  the  occurrence  of a  specified  event or  events
("Trigger Event"):

               (3) are deemed to be transferred with such Common Shares;

               (4) are not exercisable; and

               (5) are also  issued in  respect  of future  issuances  of Common
          Shares;

shall be deemed  not to have  been  distributed  for  purposes  of this  Section
12.4(d) (and no adjustment to the  Conversion  Price under this Section  12.4(d)
will be required)  until the occurrence of the earliest  Trigger Event.  If such
right or warrant is subject to subsequent  events,  upon the occurrence of which
such right or warrant shall become exercisable to purchase different distributed
assets,  evidences  of  Indebtedness  or other  assets or entitle  the holder to
purchase a different number or amount of the foregoing or to purchase any of the
foregoing at a different  purchase price, then the occurrence of each such event
shall be deemed to be the date of issuance and record date with respect to a new
right or warrant (and a  termination  or  expiration  of the  existing  right or
warrant without  exercise by the holder thereof).  In addition,  in the event of
any distribution (or deemed distribution) of rights or warrants,  or any Trigger
Event or other event (of the type  described  in the  preceding  sentence)  with
respect  thereto,  that resulted in an adjustment to the Conversion  Price under
this Section 12.4(d):

               (6) in the case of any such  rights or  warrants  which shall all
          have been  redeemed  or  repurchased  without  exercise by any holders
          thereof,  the  Conversion  Price shall be  readjusted  upon such final
          redemption  or  repurchase  to give  effect  to such  distribution  or
          Trigger  Event,  as  the  case  may  be,  as  though  it  were  a cash
          distribution,  equal to the per share  redemption or repurchase  price
          received by a holder of Common  Shares with  respect to such rights or
          warrants  (assuming such holder had retained such rights or warrants),
          made to all holders of Common Shares as of the date of such redemption
          or repurchase; and

               (7) in the case of such  rights  or  warrants  which  shall  have
          expired or been  terminated  without  exercise,  the Conversion  Price
          shall be  readjusted  as if such  rights and  warrants  had never been
          issued.

          For purposes of this Section 12.4(d) and Sections 12.4(a), 12.4(b) and
          12.4(c), any dividend or distribution to which this Section 12.4(d) is
          applicable  that  also  includes  Common  Shares,   a  subdivision  or
          combination  of Common Shares to which  Section  12.4(b)  applies,  or
          rights or warrants to subscribe for or purchase Common Shares to which
          Section 12.4(c) applies (or any combination thereof),  shall be deemed
          instead to be:

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<PAGE>

               (8) a dividend or distribution of the evidences of  Indebtedness,
          assets,  shares of capital stock, rights or warrants,  other than such
          Common  Shares,  such  subdivision  or  combination  or such rights or
          warrants  to  which  Sections  12.4(a),  12.4(b)  and  12.4(c)  apply,
          respectively  (and any  Conversion  Price  reduction  required by this
          Section  12.4(d) with respect to such dividend or  distribution  shall
          then be made), immediately followed by

               (9) a  dividend  or  distribution  of such  Common  Shares,  such
          subdivision or combination or such rights or warrants (and any further
          Conversion Price reduction  required by Sections 12.4(a),  12.4(b) and
          12.4(c) with respect to such  dividend or  distribution  shall then be
          made), except:

          (A)  the  Record  Date of  such  dividend  or  distribution  shall  be
     substituted as (x) "the date fixed for the  determination  of  stockholders
     entitled to receive  such  dividend or other  distribution",  "Record  Date
     fixed for such  determinations"  and  "Record  Date"  within the meaning of
     Section  12.4(a),   (y)  "the  day  upon  which  such  subdivision  becomes
     effective"  and "the day upon which  such  combination  becomes  effective"
     within the meaning of Section  12.4(b),  and (z) as "the date fixed for the
     determination of stockholders entitled to receive such rights or warrants",
     "the Record Date fixed for the  determination of the stockholders  entitled
     to receive  such rights or  warrants"  and such  "Record  Date"  within the
     meaning of Section 12.4(c); and

          (B) any Common Shares included in such dividend or distribution  shall
     not be deemed  "outstanding  at the close of business on the date fixed for
     such determination" within the meaning of Section 12.4(a) and any reduction
     or increase in the number of shares of Common  Shares  resulting  from such
     subdivision  or combination  shall be  disregarded in connection  with such
     dividend or distribution.

          (e) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Shares cash  (excluding  any cash that is  distributed
upon  a  reclassification,   change,  merger,  consolidation,   statutory  share
exchange,  combination,  sale or conveyance to which Section 12.11 applies or as
part of a distribution  referred to in Section 12.4(d)),  in an aggregate amount
that, combined together with:

               (1) the aggregate  amount of any other such  distributions to all
          holders of Common Shares made exclusively in cash within the 12 months
          preceding the date of payment of such distribution,  and in respect of
          which no  adjustment  pursuant to this Section  12.4(e) has been made;
          plus

               (2) the  aggregate  of any cash  plus the fair  market  value (as
          determined by the Board of  Directors,  whose  determination  shall be
          conclusive  and set  forth  in a Board  Resolution)  of  consideration
          payable in respect  of any tender  offer by the  Company or any of its
          subsidiaries  for all or any  portion of the Common  Shares  concluded
          within the 12 months preceding the date of such  distribution,  and in
          respect of which no  adjustment  pursuant to Section  12.4(f) has been
          made;

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<PAGE>

exceeds  15% of the  product of the Current  Market  Price of the Common  Shares
(determined  as provided in Section  12.4(g)) on the Record Date with respect to
such  distribution  times the number of shares of Common Shares  outstanding  on
such date, then and in each such case,  immediately  after the close of business
on such date, the Conversion Price shall be reduced so that the same shall equal
the price determined by multiplying the Conversion  Price in effect  immediately
prior to the close of business on such Record Date by a fraction:

               (3) the  numerator of which shall be equal to the Current  Market
          Price on the Record Date less an amount  equal to the  quotient of (x)
          the excess of such combined amount over such 15% and (y) the number of
          shares of Common Shares outstanding on the Record Date, and

               (4) the denominator of which shall be equal to the Current Market
          Price on such date.

However,  in the event that the then fair market value (as so determined) of the
portion of cash and other securities,  if any, so distributed  applicable to one
share of Common  Shares is equal to or greater than the Current  Market Price on
the Record Date, in lieu of the foregoing  adjustment,  adequate provision shall
be made so that each Holder shall have the right to receive upon conversion of a
Security (or any portion  thereof) the amount of cash in excess of such 15% such
Holder would have received had such Holder  converted  such Security (or portion
thereof)  immediately prior to such Record Date. In the event that such dividend
or  distribution  is not so paid or made,  the  Conversion  Price shall again be
adjusted  to be the  Conversion  Price  which  would  then be in  effect if such
dividend or distribution had not been declared.

          (f)  In  case  a  tender  offer  made  by  the  Company  or any of its
subsidiaries  for all or any portion of the Common  Shares shall expire and such
tender offer (as amended upon the expiration  thereof) shall require the payment
to  stockholders  (based on the acceptance  (up to any maximum  specified in the
terms of the  tender  offer) of  Purchased  Shares  (as  defined  below))  of an
aggregate  consideration  having a fair market value (as determined by the Board
of Directors,  whose  determination shall be conclusive and set forth in a Board
Resolution) that combined together with:

               (1) the  aggregate  of the cash  plus the fair  market  value (as
          determined by the Board of  Directors,  whose  determination  shall be
          conclusive and set forth in a Board Resolution),  as of the expiration
          of such tender offer, of consideration payable in respect of any other
          tender offers,  by the Company or any of its  subsidiaries  for all or
          any  portion  of the  Common  Shares  expiring  within  the 12  months
          preceding the  expiration of such tender offer and in respect of which
          no adjustment pursuant to this Section 12.4(f) has been made; plus

               (2) the aggregate  amount of any  distributions to all holders of
          the Common Shares made  exclusively in cash within 12 months preceding
          the  expiration  of such  tender  offer  and in  respect  of  which no
          adjustment pursuant to Section 12.4(e) has been made;

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<PAGE>

exceeds  15% of the  product of the Current  Market  Price of the Common  Shares
(determined as provided in Section 12.4(g)) as of the last time (the "Expiration
Time")  tenders could have been made pursuant to such tender offer (as it may be
amended) times the number of shares of Common Shares outstanding  (including any
tendered  shares) at the  Expiration  Time (such excess,  the "Excess  Amount"),
then, and in each such case, immediately prior to the opening of business on the
day  after  the date of the  Expiration  Time,  the  Conversion  Price  shall be
adjusted so that the same shall equal the price  determined by  multiplying  the
Conversion Price in effect immediately prior to close of business on the date of
the Expiration Time by a fraction:

               (3) the  numerator  of which  shall be (x) the product of (1) the
          number of shares of Common Shares outstanding  (including any tendered
          shares) at the Expiration Time and (2) the Current Market Price of the
          Common Shares at the Expiration Time less (y) the Excess Amount; and

               (4) the denominator  shall be the product of the number of shares
          of Common Shares  outstanding  (including any tendered  shares) at the
          Expiration  Time and the Current  Market Price of the Common Shares at
          the Expiration Time.

Such reduction (if any) shall become effective  immediately prior to the opening
of business on the day  following  the  Expiration  Time.  In the event that the
Company is obligated to purchase shares  pursuant to any such tender offer,  but
the Company is  permanently  prevented by applicable law from effecting any such
purchases or all or a portion of such  purchases are  rescinded,  the Conversion
Price shall again be adjusted to be the Conversion  Price which would then be in
effect if such (or such portion of the) tender  offer had not been made.  If the
application  of this  Section  12.4(f) to any tender  offer  would  result in an
increase in the Conversion  Price,  no adjustment  shall be made for such tender
offer under this Section 12.4(f).

          (g) For purposes of this Section 12.4, the following  terms shall have
the meanings indicated:

               (1) "Current Market Price" of a share of Common Shares shall mean
          the average of the daily Trading Prices per share of Common Shares for
          the ten  consecutive  Trading  Days  immediately  prior to the date in
          question,  minus the fair market  value per share of Common  Shares of
          any property (cash or otherwise) then held by the Depositary on behalf
          of the existing  Company  Common  Shares  holders,  then  dividing the
          resulting  value by the number of shares of Common  Shares;  provided,
          however, that if:

          (i)  the "ex" date (as hereinafter  defined) for any event (other than
               the issuance or  distribution  requiring such  computation)  that
               requires  an  adjustment  to the  Conversion  Price  pursuant  to
               Section 12.4(a), (b), (c), (d), (e) or (f) occurs during such ten
               consecutive  Trading Days, the Trading Price for each Trading Day
               prior to the "ex" date for such other  event shall be adjusted by
               multiplying  such Trading Price by the same fraction by which the
               Conversion  Price is so  required  to be  adjusted as a result of
               such other event;

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<PAGE>

          (ii) the  "ex"  date  for  any  event  (other  than  the  issuance  or
               distribution   requiring  such   computation)  that  requires  an
               adjustment to the Conversion  Price pursuant to Section  12.4(a),
               (b),  (c),  (d),  (e) or (f) occurs on or after the "ex" date for
               the issuance or distribution requiring such computation and prior
               to the day in question, the Trading Price for each Trading Day on
               and after the "ex" date for such other event shall be adjusted by
               multiplying  such Trading Price by the reciprocal of the fraction
               by which the Conversion  Price is so required to be adjusted as a
               result of such other event; and

         (iii) the "ex" date for the  issuance or  distribution  requiring  such
               computation  is prior to the day in  question,  after taking into
               account any adjustment required pursuant to clause (i) or (ii) of
               this proviso,  the Trading Price for each Trading Day on or after
               such "ex" date shall be adjusted by adding  thereto the amount of
               any cash and the fair market value (as determined by the Board of
               Directors in a manner  consistent with any  determination of such
               value for purposes of Section 12.4(d) or (f), whose determination
               shall be conclusive  and set forth in a Board  Resolution) of the
               evidences  of  Indebtedness,  shares of  capital  stock or assets
               being distributed  applicable to one share of Common Shares as of
               the close of business on the day before such "ex" date.

For purposes of any computation under Section 12.4(f),  if the "ex" date for any
event (other than the tender offer requiring such  computation) that requires an
adjustment to the Conversion Price pursuant to Section  12.4(a),  (b), (c), (d),
(e) or (f) occurs on or after the  Expiration  Time for the  tender or  exchange
offer requiring such  computation and prior to the day in question,  the Trading
Price for each Trading Day on and after the "ex" date for such other event shall
be adjusted by multiplying  such Trading Price by the reciprocal of the fraction
by which the Conversion  Price is so required to be adjusted as a result of such
other event. For purposes of this paragraph, the term "ex" date, when used:

               (A) with respect to any issuance or distribution, means the first
          date on which the Common  Shares  trades  regular way on the  relevant
          exchange or in the  relevant  market from which the Trading  Price was
          obtained without the right to receive such issuance or distribution;

               (B) with  respect to any  subdivision  or  combination  of Common
          Shares, means the first date on which the Common Shares trades regular
          way on such  exchange or in such  market  after the time at which such
          subdivision or combination becomes effective; and

               (C) with respect to any tender or exchange offer, means the first
          date on which the Common Shares trades regular way on such exchange or
          in such market after the Expiration Time of such offer.

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Notwithstanding the foregoing, whenever successive adjustments to the Conversion
Price are called for pursuant to this Section 12.4,  such  adjustments  shall be
made  to the  Current  Market  Price  as  may be  necessary  or  appropriate  to
effectuate  the intent of this Section  12.4 and to avoid unjust or  inequitable
results as determined in good faith by the Board of Directors.

               (1) "fair  market  value"  shall mean the amount  which a willing
          buyer  would pay a  willing  seller  in an arm's  length  transaction,
          which, in the absence or a current market for such transaction,  shall
          be as determined in good faith by the Board of Directors.

               (2)  "Record  Date"  shall mean,  with  respect to any  dividend,
          distribution  or other  transaction  or event in which the  holders of
          Common Shares have the right to receive any cash,  securities or other
          property or in which the Common Shares (or other applicable  security)
          is exchanged for or converted into any combination of cash, securities
          or other property,  the date fixed for  determination  of stockholders
          entitled to receive such cash,  securities or other property  (whether
          such date is fixed by the Board of Directors  or by statute,  contract
          or otherwise).

          (h) To the extent  permitted by applicable  law, the Company from time
to time may reduce the Conversion  Price by any amount for any period of time if
the  period is at least 20 days and the  reduction  is  irrevocable  during  the
period and the Board of Directors  determines in good faith that such  reduction
would be in the best  interests of the  Holders,  which  determination  shall be
conclusive and set forth in a Board Resolution. Whenever the Conversion Price is
reduced  pursuant  to the  preceding  sentence,  the  Company  shall mail to the
Trustee  and each  Holder at the  address  of such  Holder as it  appears in the
Register  a notice  of the  reduction  at  least  15 days  prior to the date the
reduced  Conversion Price takes effect,  and such notice shall state the reduced
Conversion Price and the period during which it will be in effect.

          (i) No adjustment  in the  Conversion  Price shall be required  unless
such  adjustment  would  require an  increase or decrease of at least 1% in such
price;  provided,  however, that any adjustments which by reason of this Section
12.4(i)  are not  required  to be made shall be carried  forward  and taken into
account in any subsequent  adjustment.  All  calculations  under this Article 12
shall be made by the  Company  and shall be made to the  nearest  cent or to the
nearest one hundredth of a share, as the case may be. No adjustment need be made
for a change in the par value or no par value of the Common Shares.

          (j) In any case in which this Section 12.4 provides that an adjustment
shall become effective immediately after a Record Date for an event, the Company
may defer  until the  occurrence  of such event (i) issuing to the Holder of any
Security  converted  after such  Record Date and before the  occurrence  of such
event the additional  shares of Common Shares  issuable upon such  conversion by
reason of the  adjustment  required  by such  event over and above the shares of
Common  Shares  issuable  upon  such  conversion  before  giving  effect to such
adjustment  and (ii)  paying to such  holder  any  amount in cash in lieu of any
fraction pursuant to Section 12.3.

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          (k) For purposes of this Section 12.4,  the number of shares of Common
Shares at any time outstanding  shall not include shares held in the treasury of
the Company but shall include shares issuable in respect of certificates  issued
in lieu of fractions of shares of Common Shares.

          (l) If the distribution  date for the rights provided in the Company's
rights agreement, if any, occurs prior to the date a Security is converted,  the
Holder of the Security who converts such Security after the distribution date is
not entitled to receive the rights that would otherwise be attached (but for the
date  of  conversion)  to the  Common  Shares  received  upon  such  conversion;
provided,  however,  that an adjustment  shall be made to the  Conversion  Price
pursuant  to clause  12.4(b) as if the  rights  were  being  distributed  to the
holders of the Common Shares  immediately  prior to such conversion.  If such an
adjustment is made and the rights are later redeemed, invalidated or terminated,
then a corresponding reversing adjustment shall be made to the Conversion Price,
on an equitable basis, to take account of such event.

     Section 12.5  Notice of Adjustments of Conversion Price.

          Whenever the Conversion  Price is adjusted as herein  provided  (other
than in the case of an  adjustment  pursuant to the second  paragraph of Section
12.4(h) for which the notice required by such paragraph has been provided),  the
Company shall promptly file with the Trustee and any Conversion Agent other than
the Trustee an Officers' Certificate setting forth the adjusted Conversion Price
and showing in reasonable  detail the facts upon which such adjustment is based.
Promptly after delivery of such Officers' Certificate, the Company shall prepare
a notice stating that the  Conversion  Price has been adjusted and setting forth
the  adjusted  Conversion  Price and the date on which each  adjustment  becomes
effective,  and shall  mail such  notice to each  Holder at the  address of such
Holder as it appears in the  Register  within 20 days of the  effective  date of
such adjustment. Failure to deliver such notice shall not affect the legality or
validity of any such adjustment.

     Section XII.6 Notice Prior to Certain Actions.

          In case at any time after the date hereof:

          (1) the Company shall  declare a dividend (or any other  distribution)
     on its Common  Shares  payable  otherwise  than in cash out of its  capital
     surplus or its consolidated retained earnings;

          (2) the Company  shall  authorize  the  granting to the holders of its
     Common Shares of rights or warrants to subscribe for or purchase any shares
     of capital stock of any class (or of securities  convertible into shares of
     capital stock of any class) or of any other rights;

          (3) there shall occur any reclassification of the Common Shares (other
     than a subdivision  or  combination of its  outstanding  Common  Shares,  a
     change in par  value,  a change  from par value to no par value or a change
     from no par value to par value),  or any merger,  consolidation,  statutory
     share exchange or

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<PAGE>
     combination  to which the Company is a party and for which  approval of any
     shareholders  of  the  Company  is  required,  or  the  sale,  transfer  or
     conveyance of all or substantially all of the assets of the Company; or

          (4)  there  shall  occur the  voluntary  or  involuntary  dissolution,
     liquidation or winding up of the Company;

the Company shall cause to be filed at each office or agency  maintained for the
purpose of conversion of securities  pursuant to Section 9.3, and shall cause to
be provided to the Trustee and all Holders in  accordance  with Section 15.2, at
least 20 days (or 10 days in any case  specified  in  clause  (1) or (2)  above)
prior to the applicable record or effective date hereinafter specified, a notice
stating:

          (A) the date on which a record is to be taken for the  purpose of such
     dividend,  distribution,  rights or warrants,  or, if a record is not to be
     taken,  the date as of which the  holders of record of Common  Shares to be
     entitled  to such  dividend,  distribution,  rights or  warrants  are to be
     determined; or

          (B) the date on which such  reclassification,  merger,  consolidation,
     statutory  share  exchange,   combination,   sale,  transfer,   conveyance,
     dissolution, liquidation or winding up is expected to become effective, and
     the date as of which it is expected that holders of record of Common Shares
     shall be entitled to exchange their Common Shares for  securities,  cash or
     other   property   deliverable   upon   such   reclassification,    merger,
     consolidation,  statutory  share  exchange,  sale,  transfer,  dissolution,
     liquidation or winding up.

          Neither the failure to give such notice nor any defect  therein  shall
affect the  legality or  validity of the  proceedings  or actions  described  in
clauses (1) through (4) of this Section 12.6.

     Section 12.7   Company to Reserve Common Shares.

          The  Company  shall at all times use its best  efforts to reserve  and
keep available,  free from preemptive rights, out of its authorized but unissued
Common Shares,  for the purpose of effecting the  conversion of Securities,  the
full number of shares of fully paid and  nonassessable  shares of Common  Shares
then issuable upon the conversion of all Outstanding Securities.

     Section 12.8  Covenant as to Common Shares.

          The Company  covenants  that all shares of Common  Shares which may be
issued  upon  conversion  of  Securities  will  upon  issue  be  fully  paid and
nonassessable  and, except as provided in Section 12.9, the Company will pay all
taxes, liens and charges with respect to the issue thereof.

      Section 12.9  Taxes on Conversions.

          A Holder or Person  delivering a Security for conversion  shall not be
liable  for and  will be not be  required  to pay any tax or duty  which  may be
payable in respect of the issue or

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<PAGE>

delivery of Common Shares on conversion of Securities  pursuant  hereto,  unless
such  issuance  and  delivery  is on behalf of a Holder but in another  Person's
name.

     Section 12.10  Cancellation of Converted Securities.

          All  Securities  delivered  for  conversion  shall be delivered to the
Trustee to be  canceled  by or at the  direction  of the  Trustee,  which  shall
dispose of the same as provided in Section 2.17.

     Section 12.11  Effect of Reclassification, Consolidation, Merger or Sale.

          If any of following events occur, namely:

               (1) any  reclassification  or  change of the  outstanding  Common
          Shares (other than a change in par value,  or from par value to no par
          value,  or  from  no par  value  to par  value,  or as a  result  of a
          subdivision or combination);

               (2)  any  merger,  consolidation,  statutory  share  exchange  or
          combination  of the Company  with another  corporation  as a result of
          which  holders of Common  Shares  shall be entitled to receive  stock,
          securities or other property or assets  (including  cash) with respect
          to or in exchange for such Common Shares; or

               (3) any sale or  conveyance of the  properties  and assets of the
          Company as, or substantially  as, an entirety to any other corporation
          as a result of which  holders of Common  Shares  shall be  entitled to
          receive stock, securities or other property or assets (including cash)
          with respect to or in exchange for such Common Shares;

the Company or the  successor  or  purchasing  corporation,  as the case may be,
shall execute with the Trustee a supplemental indenture (which shall comply with
the TIA as in force at the date of execution of such  supplemental  indenture if
such  supplemental  indenture is then required to so comply) providing that such
Security  shall be  convertible  into the kind and amount of shares of stock and
other securities or property or assets  (including cash) which such Holder would
have been  entitled  to  receive  upon such  reclassification,  change,  merger,
consolidation,  statutory  share exchange,  combination,  sale or conveyance had
such  Securities  been  converted into Common Shares  immediately  prior to such
reclassification,  change,  merger,  consolidation,  statutory  share  exchange,
combination,  sale or  conveyance  assuming such holder of Common Shares did not
exercise its rights of election, if any, as to the kind or amount of securities,
cash or other property  receivable  upon such merger,  consolidation,  statutory
share  exchange,  sale or  conveyance  (provided  that, if the kind or amount of
securities,  cash or other property receivable upon such merger,  consolidation,
statutory share  exchange,  sale or conveyance is not the same for each share of
Common  Shares in respect of which such rights of  election  shall not have been
exercised  ("Non-Electing  Share"),  then for the purposes of this Section 12.11
the kind and amount of securities,  cash or other property  receivable upon such
merger,  consolidation,  statutory share  exchange,  sale or conveyance for each
Non-Electing  Share shall be deemed to be the kind and amount so receivable  per
share by a plurality of the Non-Electing  Shares).  Such supplemental  indenture

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<PAGE>

shall  provide for  adjustments  which shall be as nearly  equivalent  as may be
practicable to the adjustments  provided for in this Article 12. If, in the case
of any such  reclassification,  change, merger,  consolidation,  statutory share
exchange,  combination,  sale or conveyance,  the stock or other  securities and
assets  receivable  thereupon by a holder of Common  Shares  includes  shares of
stock or other  securities and assets of a corporation  other than the successor
or purchasing corporation, as the case may be, in such reclassification, change,
merger,   consolidation,   statutory  share  exchange,   combination,   sale  or
conveyance,  then such  supplemental  indenture  shall also be  executed by such
other  corporation and shall contain such  additional  provisions to protect the
interests  of the  Holders of the  Securities  as the Board of  Directors  shall
reasonably  consider  necessary  by reason of the  foregoing,  including  to the
extent practicable the provisions  providing for the Repurchase Rights set forth
in Article 11.

          The Company shall cause notice of the  execution of such  supplemental
indenture  to be mailed to each  Holder,  at the  address  of such  Holder as it
appears on the  Register,  within 20 days after  execution  thereof.  Failure to
deliver  such  notice  shall  not  affect  the  legality  or  validity  of  such
supplemental indenture.

          The  above  provisions  of  this  Section  shall  similarly  apply  to
successive   reclassifications,   mergers,   consolidations,   statutory   share
exchanges, combinations, sales and conveyances.

          If this Section 12.11 applies to any event or occurrence, Section 12.4
shall not apply.

     Section 12.12  Responsibility of Trustee for Conversion Provisions.

          The  Trustee,  subject  to the  provisions  of  Section  5.1,  and any
Conversion  Agent shall not at any time be under any duty or  responsibility  to
any Holder of Securities to determine  whether any facts exist which may require
any adjustment of the Conversion  Price, or with respect to the nature or intent
of any such adjustments  when made, or with respect to the method  employed,  or
herein or in any supplemental  indenture provided to be employed,  in making the
same.  Neither the Trustee,  subject to the  provisions  of Section 5.1, nor any
Conversion  Agent shall be accountable with respect to the validity or value (of
the kind or  amount) of any  Common  Shares,  which may at any time be issued or
delivered  upon the  conversion of any Security;  and it or they do not make any
representation  with  respect  thereto.  Neither  the  Trustee,  subject  to the
provisions of Section 5.1, nor any Conversion Agent shall be responsible for any
failure of the Company to make any cash payment or to issue, transfer or deliver
any shares of stock or share  certificates or other  securities or property upon
the  surrender of any Security for the purpose of  conversion;  and the Trustee,
subject to the provisions of Section 5.1, and any Conversion  Agent shall not be
responsible  or liable for any  failure of the Company to comply with any of the
covenants of the Company contained in this Article.

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                                  Article XIII

                                    GUARANTEE

     Section 13.1    Guarantee.

          The  Guarantor,   for  consideration  received,   unconditionally  and
irrevocably guarantees to each Holder, and to the Trustee on behalf of each such
Holder,  the due and punctual  payment of amounts payable at Maturity,  Adjusted
Interest Rate, Redemption Price, Change in Control Purchase Price,  interest, if
any,  in respect  of the  foregoing,  when and as the same shall  become due and
payable,  according to the terms of the Notes and of this Indenture.  In case of
the failure of the Company or any successors  thereto punctually to pay any such
amount,  the Guarantor hereby agrees to cause such payment to be made punctually
when and as the same shall become due and payable,  as if such payment were made
by the Company.

          In  addition,   the  Guarantor  hereby  fully,   unconditionally   and
irrevocably  guarantees  to each  Holder,  and to the  Trustee for itself and on
behalf of each such Holder:

          (1) the performance of:

          (a) each of the covenants and agreements of the Company  hereunder and
     in the Securities not described in the preceding paragraph or in clause (b)
     below, in each case, in accordance with the terms thereof and hereof; and

          (b) to the  extent it is  permitted  by  applicable  law to do so, the
     delivery of Common Shares upon any exchange of Securities, according to the
     terms thereof and of this Indenture; and

          (c) if, and to the extent, but only to, the extent, that the foregoing
     guarantee  of the  obligations  described  in  clause  (1)(b)  above is not
     enforceable  in  accordance  with its  terms  under  applicable  law  which
     restricts or prohibits the Guarantor from  guaranteeing the delivery of the
     Common  Shares upon any  exchange  of  Securities,  according  to the terms
     thereof and of this Indenture,  or the Guarantor is otherwise not permitted
     to  guarantee  the  performance  of  such  obligations  or  to  honor  such
     guarantee,  the Company shall pay to the Holders an amount in Dollars equal
     to the value of the Common Shares such Holders would  otherwise be entitled
     to receive  hereunder and under the Securities in accordance with the terms
     thereof,  and the Guarantor  hereby  guarantees  such payment in accordance
     with the provisions of the first paragraph of this Section 13.1.

          In  case  of the  failure  of the  Company  or any  successor  thereto
punctually  to comply with any  covenant or  agreement  described  in clause (1)
above,  to the extent it is permitted by  applicable  law to do so the Guarantor
hereby agrees to cause such covenant or agreement to be performed as and when it
shall be provided to be  performed  hereunder or in the  Securities,  as if such
performance were performed by the Company.

          In  all  respects,  the  Guarantor  hereby  further  agrees  that  its
respective   obligations   hereunder   shall  be  absolute  and   unconditional,
irrespective  of, and shall be unaffected by, any  invalidity,  irregularity  or
unenforceability  of any such  Security  or this  Indenture,  the absence of any
action to enforce the same,  the granting of any waiver or consent by any Holder
with respect to any provisions thereof, the recovery of any judgment against the
Company or any action to

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<PAGE>

enforce the same, or any other circumstance  which might otherwise  constitute a
legal or equitable discharge or defense of the Guarantor.

          The Guarantor hereby waives diligence, presentment, demand of payment,
filing of  claims  with a court in the  event of  merger  or  bankruptcy  of the
Company,  any right to require a  proceeding  first  against  the  Company,  the
benefit of  discussion,  protest or notice with respect to any such Security and
all demands  whatsoever and covenants that this Guarantee will not be discharged
except by complete performance of the obligations contained in any such Security
and in this Guarantee.

          If the Trustee or any Holder is required by any court or  otherwise to
return to the Company or the Guarantor or any custodian,  receiver,  liquidator,
trustee,  or other  similar  official  acting in  relation to the Company or the
Guarantor,  any  amount  paid to the  Trustee  or such  Holder in  respect  of a
Security, this Guarantee, to the extent theretofore discharged by the payment of
such amount, shall be reinstated in full force and effect. The Guarantor further
agrees that, as between the Guarantor,  on the one hand, and the Holders and the
Trustee,  on the other  hand,  (i) the  maturity of the  obligations  guaranteed
hereby may be accelerated as provided in Article Four hereof for the purposes of
this Guarantee, and (ii) in the event of any declaration of acceleration of such
obligations as provided in Article Four hereof, such obligations (whether or not
due and payable) shall forthwith become due and payable by the Guarantor for the
purpose of this Guarantee.

          The  Guarantor  shall be subrogated to all rights of the Holder of any
Securities  and the Trustee  against the Company  pursuant to the  provisions of
this  Guarantee;  provided,  however,  that  until  the  payment  in full of all
obligations and all other amounts  payable under this  Guarantee,  the Guarantor
hereby  irrevocably  waives any claim or other rights which they each may now or
hereafter  acquire against the Company that arises from the existence,  payment,
performance or enforcement of the Guarantor's  obligations under this Guarantee,
including,   without  limitation,  any  right  of  subrogation,   reimbursement,
exoneration,  contribution,  indemnification,  any right to  participate  in any
claim or remedy of any Holder and the Trustee on behalf of such  Holder  against
the Company or any collateral  which any such Holder or the Trustee on behalf of
such  Holder  hereafter  acquires,  whether or not such  claim,  remedy or right
arises in equity, or under contract,  statute or common law, including,  without
limitation,  the  right  to  take or  receive  from  the  Company,  directly  or
indirectly,  in cash or other  property  or by set-off  or in any other  manner,
payment or  security  on account  of such claim or other  rights.  If any amount
shall be paid to the  Guarantor in violation  of the  preceding  sentence at any
time  prior to the  payment  in full of all  obligations  and all other  amounts
payable under this  Guarantee,  such amount shall be deemed to have been paid to
the  Guarantor  for the  benefit  of, and held in trust for the  benefit of, any
Holder and the Trustee on behalf of such Holder,  and shall forthwith be paid to
the Trustee for the benefit of such Holder to be credited  and applied upon such
guaranteed  obligations,  whether  matured or unmatured,  in accordance with the
terms of this Indenture. The Guarantor acknowledges that the waiver set forth in
this Section 13.1 is knowingly made.

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     Section 13.2  Execution and Delivery of Guarantee.

          To evidence its Guarantee provided in this Article XIII, the Guarantor
hereby agrees to execute the Guarantee,  substantially  in the form of Exhibit B
and which shall be endorsed on each Security  authenticated and delivered by the
Trustee after such Guarantee is executed by either manual or facsimile signature
of an Officer of the Guarantor. The validity and enforceability of the Guarantee
shall not be affected by the fact that it is not affixed to the Note.

          If the Officer  whose  signature is on a Security no longer holds that
office at the time the Security is  authenticated,  the Security  shall be valid
nevertheless.

          The   delivery  of  any   Securities   by  the   Trustee,   after  the
authentication thereof hereunder, shall constitute due delivery of the Guarantee
endorsed  thereon on behalf of the Guarantor.  The Guarantor  hereby agrees that
its  Guarantee  set forth in this  Article  XIII shall  remain in full force and
effect  notwithstanding  any  failure to endorse on each  Security a notation of
such Guarantee.

     Section 13.3  Guarantee Obligations Subordinated to Guarantor Senior Debt.

          The Guarantor  covenants and agrees, and each Holder of a Note, by its
acceptance thereof, likewise covenants and agrees, that all payments pursuant to
the Guarantee  made by or on behalf of the Guarantor are hereby  expressly  made
subordinate and subject in right of payment as provided in this Article Thirteen
to the prior  payment in full in cash of all amounts  payable under all existing
and future Guarantor Senior Debt.

          This Section 13.3 and the  following  Sections  13.4 through  13.16 of
this Article Thirteen shall constitute a continuing offer to all persons who, in
reliance upon such provisions,  become holders of, or continue to hold Guarantor
Senior  Debt  and,  to the  extent  set forth in  Section  13.5(b),  holders  of
Designated  Senior  Debt;  and such  provisions  are made for the benefit of the
holders  of  Guarantor  Senior  Debt and,  to the  extent  set forth in  Section
13.5(b),  holders of Designated  Senior Debt;  and such holders (to such extent)
are  made  obligees  hereunder  and  they  or  each of  them  may  enforce  such
provisions.

     Section  13.4  Payment  Over of Proceeds  upon  Dissolution,  etc.,  of the
Guarantor.

          In the event of (a) any  insolvency or bankruptcy  case or proceeding,
or any  receivership,  liquidation,  reorganization  or  other  similar  case or
proceeding  in  connection  therewith,  relative  to  the  Guarantor  or to  its
creditors,  as such, or to its assets,  or (b) any  liquidation,  dissolution or
other winding-up of the Guarantor,  whether voluntary or involuntary and whether
or not involving insolvency or bankruptcy, or (c) any assignment for the benefit
of creditors or any other marshalling of assets or liabilities of the Guarantor,
then and in any such event:

               (1) the holders of all Guarantor Senior Debt shall be entitled to
          receive  payment in full in cash or, as  acceptable  to the holders of
          such Guarantor  Senior Debt, in any other manner of all amounts due on
          or in respect of all such Guarantor Senior Debt, or provision shall be
          made for such payment, before the Holders of the Notes are entitled to
          receive,  pursuant to this  Guarantee,  any

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<PAGE>

          payment or  distribution  of any kind or  character by or on behalf of
          the  Guarantor  on account of the  Guarantor's  obligations  under the
          Notes; and

               (2) any payment or distribution of assets of the Guarantor of the
          kind or character, whether in cash, property or securities, by set-off
          or  otherwise,  to which the Holders or the Trustee  would be entitled
          but for the subordination provisions of this Article Thirteen shall be
          paid by the  liquidating  trustee or agent or other person making such
          payment or distribution,  whether a trustee in bankruptcy,  a receiver
          or  liquidating  trustee  or  otherwise,  directly  to the  holders of
          Guarantor Senior Debt or its  representative or  representatives or to
          the  trustee  or  trustees   under  any  indenture   under  which  any
          instruments  evidencing any of the Guarantor Senior Debt may have been
          issued, ratably according to the aggregate amounts remaining unpaid on
          account of the Guarantor  Senior Debt held or  represented by each, to
          the  extent  necessary  to  make  payment  in  full in cash of all the
          Guarantor  Senior Debt  remaining  unpaid,  after giving effect to any
          concurrent  payment or  distribution  to the holders of the  Guarantor
          Senior Debt; and

               (3) in the event that,  notwithstanding the foregoing  provisions
          of this Section 13.4, the Trustee or the Holder of any Note shall have
          received any payment or distribution of assets of the Guarantor of any
          kind or character, whether in cash, property or securities, in respect
          of any obligations of such Guarantor  under this Guarantee  before all
          Guarantor  Senior  Debt is paid  in  full in cash or  payment  thereof
          provided  for,  then and in such  event such  payment or  distribution
          shall be paid over or delivered forthwith to the Senior Representative
          for  application  to the  payment  of all the  Guarantor  Senior  Debt
          remaining  unpaid, to the extent necessary to pay all of the Guarantor
          Senior Debt in full in cash,  after  giving  effect to any  concurrent
          payment or distribution to or for the holders of the Guarantor  Senior
          Debt.  Any such  payment or  distribution  of assets  received  by the
          Trustee,   which  is   required   to  be  paid  over  to  the   Senior
          Representative,  will be held in trust by the  Trustee for the benefit
          of the holders of the Guarantor Senior Debt.

     Section 13.5 Suspension of Guarantee Obligations When Guarantor Senior Debt
in Default.

          (a) Unless Section 13.4 shall be applicable, after the occurrence of a
Payment  Default  with  respect  to any  Guarantor  Senior  Debt no  payment  or
distribution  of any assets of the  Guarantor of any kind or character  shall be
made by or on behalf of the Guarantor on account of the Guarantor's  obligations
pursuant to the Notes or on account of the purchase,  redemption,  defeasance or
other acquisition of the obligations  pursuant to the Notes or on account of any
other  obligations of the Guarantor  under this Guarantee  unless and until such
Payment Default shall have been cured or waived or shall have ceased to exist or
the Guarantor  Senior Debt as to which such Payment  Default  relates shall have
been  discharged or paid in full in cash,  after which,  subject to Section 13.4
(if applicable), the Guarantor shall resume making any and all required payments
in respect of its obligations under this Guarantee.

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          (b) Unless  Section  13.4  shall be  applicable,  during  any  Payment
Blockage Period with respect to any Designated Guarantor Senior Debt, no payment
or distribution of any assets of the Guarantor of any kind or character shall be
made by or on behalf of the Guarantor on account of the Guarantor's  obligations
on the Notes or on  account of the  purchase,  redemption,  defeasance  or other
acquisition of the Guarantor's  obligations on the Notes or on account of any of
the other  obligations of the Guarantor under this Guarantee;  provided that the
foregoing  prohibition  shall not apply unless such Payment  Blockage Period has
been  instituted  under Section  14.3(b) by a Senior  Representative  acting for
holders of Designated  Senior Debt which also constitutes  Designated  Guarantor
Senior Debt. Upon the  termination of any Payment  Blockage  Period,  subject to
Section 13.5 (if  applicable),  the  Guarantor  shall resume  making any and all
required payments in respect of its obligations under this Guarantee.

          (c) In the event that,  notwithstanding the foregoing,  the Trustee or
the  Holder of any Note shall  have  received  any  payment  from the  Guarantor
prohibited  by the foregoing  provisions of this Section 13.5,  then and in such
event such  payment  shall be paid over and  delivered  forthwith  to the Senior
Representative initiating the Payment Blockage Period, in trust for distribution
to the  holders  of  Guarantor  Senior  Debt or, if no  amounts  are then due in
respect of Guarantor Senior Debt, prompt return to the Guarantor,  or as a court
of competent jurisdiction shall direct.

     Section 13.6   Waiver of Subrogation.

          The  Guarantor  hereby  irrevocably  waives any claim or other  rights
which it may now or  hereafter  acquire  against the Company that arise from the
existence,  payment,  performance or enforcement of the Guarantor's  obligations
under this Guarantee and this  Indenture,  including,  without  limitation,  any
right of subrogation, reimbursement, exoneration, indemnification, and any right
to  participate  in any  claim or  remedy of any  Holder  of Notes  against  the
Company,  whether or not such claim,  remedy or right arises in equity, or under
contract,  statute or common law, including,  without  limitation,  the right to
take or receive  from the  Company,  directly  or  indirectly,  in cash or other
property or by set-off or in any other manner, payment or security on account of
such claim or other  rights.  If any amount  shall be paid to the  Guarantor  in
violation  of the  preceding  sentence and the Notes shall not have been paid in
full,  such amount shall have been deemed to have been paid to the Guarantor for
the  benefit of, and held in trust for the benefit of, the Holders of the Notes,
and shall, subject to the subordination  provisions of this Article Thirteen and
to Article  Fourteen,  forthwith  be paid to the Trustee for the benefit of such
Holders to be credited and applied upon the Notes, whether matured or unmatured,
in accordance with the terms of this Indenture.  The Guarantor acknowledges that
it will receive  direct and indirect  benefits from the  financing  arrangements
contemplated  by this  Indenture  and that the waiver set forth in this  Section
13.6 is knowingly made in contemplation of such benefits.

     Section 13.7  Guarantee Subordination Provisions Solely To Define Relative
Rights.

          The  subordination  provisions  of this  Article are and are  intended
solely for the purpose of  defining  the  relative  rights of the Holders of the
Notes on the one hand and the  holders  of  Guarantor  Senior  Debt and,  to the
extent set forth in Section 13.5, holders of Designated

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Senior Debt on the other hand.  Nothing  contained in this  Article  Thirteen or
elsewhere in this  Indenture or in the Notes is intended to or shall (a) impair,
as among the Guarantor, its creditors other than holders of its Guarantor Senior
Debt and the Holders of the Notes,  the  obligation of the  Guarantor,  which is
absolute and  unconditional,  to make  payments to the Holders in respect of its
obligations  under  this  Guarantee  as and when the same  shall  become due and
payable in  accordance  with their  terms;  or (b)  affect the  relative  rights
against the Guarantor of the Holders of the Notes and creditors of the Guarantor
other than the holders of the Guarantor  Senior Debt; or (c) prevent the Trustee
or the Holder of any Note from  exercising all remedies  otherwise  permitted by
applicable law upon Default or an Event of Default under this Indenture, subject
to the  rights,  if any,  under the  subordination  provisions  of this  Article
Thirteen of the holders of  Guarantor  Senior  Debt,  to the extent set forth in
Section  13.5,  holders of Designated  Senior Debt (1) in any case,  proceeding,
dissolution,  liquidation  or other  winding-up,  assignment  for the benefit of
creditors  or other  marshaling  of  assets  and  liabilities  of the  Guarantor
referred to in Section 13.4, to receive, pursuant to and in accordance with such
Section,  cash, property and securities  otherwise payable or deliverable to the
Trustee or such Holder,  or (2) under the conditions  specified in Section 13.5,
to prevent  any  payment  prohibited  by such  Section or enforce  their  rights
pursuant to Section 13.5(c).

          The  failure  by the  Guarantor  to make a payment  in  respect of its
obligations  under this  Guarantee  by reason of any  provision  of this Article
Thirteen  shall not be construed as preventing the occurrence of a Default or an
Event of Default hereunder.

     Section 13.8  Trustee To Effectuate Subordination of Guarantee Obligations.

          Each Holder of a Note by his acceptance thereof authorizes and directs
the Trustee on his behalf to take such action as may be necessary or appropriate
to effectuate the  subordination  provided in this Article Thirteen and appoints
the Trustee his  attorney-in-fact for any and all such purposes,  including,  in
the event of any dissolution,  winding-up,  liquidation or reorganization of the
Guarantor  whether  in  bankruptcy,  insolvency,  receivership  proceedings,  or
otherwise,  the  timely  filing  of a  claim  for  the  unpaid  balance  of  the
Indebtedness  of the Guarantor owing to such Holder in the form required in such
proceedings  and the causing of such claim to be  approved.  If the Trustee does
not file such a claim prior to 30 days before the expiration of the time to file
such a claim, the holders of Guarantor Senior Debt, or any  representative,  may
file such a claim on behalf of Holders of the Notes.

     Section 13.9  No Waiver of Guarantee Subordination Provisions.

          (a) No right of any present or future holder of the  Guarantor  Senior
Debt or Designated Senior Debt to enforce subordination as herein provided shall
at any time in any way be prejudiced or impaired by any act or failure to act on
the part of the  Company or the  Guarantor  or by any act or failure to act,  in
good faith, by any such holder,  or by any  non-compliance by the Company or the
Guarantor with the terms, provisions and covenants of this Indenture, regardless
of any knowledge thereof any such holder may have or be otherwise charged with.

          (b) Without  limiting the generality of subsection (a) of this Section
13.9,  the  holders of  Guarantor  Senior Debt may, at any time and from time to
time,  without  the  consent of

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or  notice  to the  Trustee  or the  Holders  of the  Notes,  without  incurring
responsibility  to the Holders of the Notes and without  impairing  or releasing
the subordination provided in this Article Thirteen or the obligations hereunder
of the Holders of the Notes to the holders of such Guarantor Senior Debt, do any
one or more of the following:  (1) change the manner,  place or terms of payment
or extend the time of payment of, or renew or alter,  such Guarantor Senior Debt
or any  Senior  Debt as to which  such  Guarantor  Senior  Debt  relates  or any
instrument  evidencing  the same or any  agreement  under  which such  Guarantor
Senior Debt or such Senior Debt is outstanding;  (2) sell, exchange,  release or
otherwise deal with any property pledged,  mortgaged or otherwise  securing such
Guarantor  Senior Debt or any Senior Debt as to which such Guarantor Senior Debt
relates;  (3)  release  any person  liable in any manner for the  collection  or
payment  of such  Guarantor  Senior  Debt or any  Senior  Debt as to which  such
Guarantor  Senior Debt relates;  and (4) exercise or refrain from exercising any
rights  against the Guarantor  and any other  person;  provided that in no event
shall any such  actions  limit the right of the Holders of the Notes to take any
action to accelerate  the maturity of the Notes  pursuant to Article Four hereof
or to pursue any rights or remedies  hereunder or under  applicable  laws if the
taking of such action does not otherwise violate the terms of this Indenture.

     Section 13.10  Guarantor To Give Notice to Trustee.

          (a) The Company and the Guarantor  shall give prompt written notice to
the Trustee of any fact known to the Guarantor  which would  prohibit the making
of any payment to or by the Trustee in respect of the Notes. Notwithstanding the
subordination  provisions  of  this  Article  or any  other  provision  of  this
Indenture,  the Trustee shall not be charged with  knowledge of the existence of
any facts which would prohibit the making of any payment to or by the Trustee in
respect of the Notes,  unless and until the Trustee shall have received  written
notice thereof at its Corporate Trust Office from the Company,  the Guarantor or
a holder of its  Guarantor  Senior Debt or from any trustee,  fiduciary or agent
therefor;  and,  prior to the receipt of any such written  notice,  the Trustee,
subject to the  provisions  of this  Section  13.10,  shall be  entitled  in all
respects to assume that no such facts exist;  provided that if the Trustee shall
not have  received the notice  provided  for in this Section  13.10 at least two
Business  Days  prior to the date upon  which by the terms  hereof any money may
become  payable  for  any  purpose  under  this  Indenture  (including,  without
limitation,  the payment of the  principal  of or  interest on any Note),  then,
anything herein contained to the contrary  notwithstanding  but without limiting
the rights and  remedies  of the  holders of such  Guarantor  Senior Debt or any
trustee,  fiduciary  or agent  thereof,  the  Trustee  shall have full power and
authority  to receive  such money and to apply the same to the purpose for which
such money was  received and shall not be affected by any notice to the contrary
which may be received  by it within two  Business  Days prior to such date;  nor
shall the Trustee be charged with knowledge of the curing of any such default or
the  elimination of the act or condition  preventing any such payment unless and
until  the  Trustee  shall  have  received  an  Officers'  Certificate  from the
Guarantor to such effect.

          (b) Subject to the  provisions  of Section 5.1,  the Trustee  shall be
entitled to rely on the delivery to it of a written notice to the Trustee,  by a
person  representing  himself  to be a holder  of  Guarantor  Senior  Debt (or a
trustee,  fiduciary or agent therefor). In the event that the Trustee determines
in good faith that further evidence is required with respect to the right of any
person as a holder of  Guarantor  Senior Debt to  participate  in any payment or
distribution  pursuant to this

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Article Thirteen, the Trustee may request such person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Guarantor Senior Debt
held by such person,  the extent to which such person is entitled to participate
in such payment or  distribution  and any other facts pertinent to the rights of
such person under this Article Thirteen,  and if such evidence is not furnished,
the Trustee may defer any payment to such person pending judicial  determination
as to the right of such person to receive such payment.

     Section 13.11  Reliance on Judicial  Order or  Certificate  of  Liquidating
Agent Regarding Dissolution, etc., of Guarantor.

          Upon any payment or distribution  of assets of the Guarantor  referred
to in this Article Thirteen,  the Trustee,  subject to the provisions of Section
5.1, and the Holders shall be entitled to rely upon any order or decree  entered
by any court of competent  jurisdiction  in which such  insolvency,  bankruptcy,
receivership,  liquidation,  reorganization,  dissolution, winding-up or similar
case or proceeding is pending,  or a certificate  of the trustee in  bankruptcy,
receiver, liquidating trustee, custodian, assignee for the benefit of creditors,
agent or other  person  making such  payment or  distribution,  delivered to the
Trustee or to the Holders,  for the purpose of ascertaining the persons entitled
to participate in such payment or distribution,  the holders of Guarantor Senior
Debt and other  Indebtedness  of the  Guarantor,  the amount  thereof or payable
thereon,  the amount or amounts paid or distributed  thereon and all other facts
pertinent thereto or to this Article Thirteen; provided that the foregoing shall
apply only if such  court has been  fully  apprised  of the  provisions  of this
Article Thirteen.

     Section 13.12 Rights of Trustee as a Holder of Guarantor Senior Debt;
Preservation of Trustee's Rights.

          The Trustee in its  individual  capacity  shall be entitled to all the
rights set forth in this Article  Thirteen with respect to any Guarantor  Senior
Debt  which may at any time be held by the  Trustee,  to the same  extent as the
other holder of such Guarantor  Senior Debt, and nothing in this Indenture shall
deprive the Trustee of any of its rights as such holder.

     Section 13.13   Article Thirteen Applicable to Paying Agents.

          In case at any time any Paying Agent other than the Trustee shall have
been appointed by the Company and be then acting  hereunder,  the term "Trustee"
as used  in this  Article  Thirteen  shall  in such  case  (unless  the  context
otherwise requires) be construed as extending to and including such Paying Agent
within its meaning as fully for all intents and purposes as if such Paying Agent
were named in this  Article  Thirteen in addition to or in place of the Trustee;
provided  that Section  13.12 shall not apply to the Company or any Affiliate of
the Company if it or such Affiliate acts as Paying Agent.

     Section 14.14 No Suspension of Remedies Subject to Rights of Holders
of Guarantor Senior Debt.

          Nothing  contained in this Article  Thirteen  shall limit the right of
the  Trustee  or the  Holders  of Notes to take any  action  to  accelerate  the
maturity  of the Notes  pursuant  to

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<PAGE>

Article Four or to pursue any rights or remedies  hereunder or under  applicable
law, subject to the rights,  if any, under this Article Thirteen of the holders,
from time to time, of Guarantor Senior Debt.

     Section 13.15   Trustee's Relation to Guarantor Senior Debt.

          With  respect to the holders of  Guarantor  Senior  Debt,  the Trustee
undertakes to perform or to observe only such of its  covenants and  obligations
as are  specifically set forth in this Article Thirteen (and in Article Fourteen
with  respect to Senior  Debt),  and no implied  covenants or  obligations  with
respect  to the  holders  of  Guarantor  Senior  Debt  shall be read  into  this
Indenture  against  the  Trustee.  The  Trustee  shall  not be deemed to owe any
fiduciary duty to the holders of Guarantor Senior Debt and the Trustee shall not
be liable to any holder of Guarantor Senior Debt if it shall mistakenly pay over
or deliver to Holders, the Company or any other person moneys or assets to which
any holder of Guarantor  Senior Debt shall be entitled by virtue of this Article
Thirteen or otherwise.

     Section 13.16   Subrogation.

          Upon the  payment in full in cash of all amounts  payable  under or in
respect of  Guarantor  Senior  Debt and of all Senior Debt of the  Company,  the
Holders  shall be  subrogated  to the rights of the  holders  of such  Guarantor
Senior Debt to receive payments or distributions of assets of the Guarantor made
on such Guarantor Senior Debt until all amounts due under the Guarantee shall be
paid  in  full;  and for  the  purposes  of such  subrogation,  no  payments  or
distributions to holders of such Guarantor Senior Debt of any cash,  property or
securities  to which  Holders  of the Notes  would be  entitled  except  for the
provisions of this Article  Thirteen,  and no payment pursuant to the provisions
of this  Article  Thirteen  to  holders  of such  Guarantor  Senior  Debt by the
Holders,  shall,  as between the Guarantor,  its creditors other than holders of
such  Guarantor  Senior Debt and the Holders,  be deemed to be a payment by such
Guarantor to or on account of such Guarantor  Senior Debt, its being  understood
that the  provisions  of this  Article  Thirteen  are solely for the  purpose of
defining the relative  rights of the holders of such  Guarantor  Senior Debt, on
the one hand, and the Holders, on the other hand.

          If any payment or  distribution  to which the Holders would  otherwise
have been entitled but for the  provisions of this Article  Thirteen  shall have
been  applied,  pursuant to the  provisions  of this  Article  Thirteen,  to the
payment of all amounts payable under the Guarantor Senior Debt, then and in such
case,  the  Holders  shall be  entitled  to  receive  from the  holders  of such
Guarantor  Senior Debt at the time  outstanding  any  payments or  distributions
received  by such  holders  of  Guarantor  Senior  Debt in excess of the  amount
sufficient  to pay all  amounts  payable  under or in respect of such  Guarantor
Senior Debt in full.

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                                   Article XIV

                             SUBORDINATION OF NOTES

     Section 14.1  Notes Subordinate to Senior Debt.

          The Company  covenants  and agrees,  and each Holder of a Note, by his
acceptance  thereof,  likewise covenants and agrees,  that, to the extent and in
the manner  hereinafter  set forth in this Article  Fourteen,  the  Indebtedness
represented by the Notes are hereby  expressly made  subordinate  and subject in
right of payment as  provided  in this  Article to the prior  payment in full in
cash of all amounts payable under all existing and future Senior Debt.

          This Article  Fourteen  shall  constitute  a  continuing  offer to all
persons who, in reliance upon such provisions, become holders of, or continue to
hold Senior Debt; and such provisions are made for the benefit of the holders of
Senior Debt;  and such holders are made  obligees  hereunder and they or each of
them individually or through their representative may enforce such provisions.

     Section 14.2  Payment Over of Proceeds upon Dissolution, etc.

          In the event of (a) any  insolvency or bankruptcy  case or proceeding,
or any  receivership,  liquidation,  reorganization  or  other  similar  case or
proceeding in connection therewith, relating to the Company or to its creditors,
as  such,  or to its  assets,  or (b)  any  liquidation,  dissolution  or  other
winding-up of the Company,  whether  voluntary or involuntary and whether or not
involving insolvency or bankruptcy, then and in any such event:

               (1) the  holders of all Senior  Debt shall be entitled to receive
          payment  in full in cash of all  obligations  due in  respect  of such
          Senior Debt  before the  Holders of the Notes are  entitled to receive
          any payment or distribution of any kind or character on account of the
          Notes; and

               (2) any payment or  distribution  of assets of the Company of any
          kind or character, whether in cash, property or securities, by set-off
          or  otherwise,  to which the Holders or the Trustee  would be entitled
          but  for  the  provisions  of  this  Article  shall  be  paid  by  the
          liquidating  trustee or agent or other  person  making such payment or
          distribution,   whether  a  trustee  in  bankruptcy,   a  receiver  or
          liquidating  trustee or  otherwise,  directly to the holders of Senior
          Debt or their  representative or  representatives or to the trustee or
          trustees under any indenture  under which any  instruments  evidencing
          any of such Senior Debt may have been issued, ratably according to the
          aggregate  amounts remaining unpaid on account of the Senior Debt held
          or  represented  by each,  to the extent  necessary to make payment in
          full in cash of all Senior Debt remaining unpaid,  after giving effect
          to any  concurrent  payment  or  distribution  to the  holders of such
          Senior Debt; and

               (3) in the event that,  notwithstanding the foregoing  provisions
          of this Section 14.2, the Trustee or the Holder of any Note shall have
          received any

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          payment or  distribution of properties or assets of the Company of any
          kind or character, whether in cash, property or securities, by set off
          or otherwise in respect of the Notes before all Senior Debt is paid or
          provided  for in full in cash,  then and in such event such payment or
          distribution shall be paid over or delivered  forthwith to the trustee
          in bankruptcy,  receiver,  liquidating trustee,  custodian,  assignee,
          agent or other person making payment or  distribution of assets of the
          Company for  application  to the payment of all Senior Debt  remaining
          unpaid,  to the extent  necessary  to pay all  Senior  Debt in full in
          cash, after giving effect to any concurrent payment or distribution to
          or for the holders of Senior Debt. Any such payment or distribution of
          the assets received by the Trustee,  which is required to be paid over
          to the Senior Representative, will be held in trust by the Trustee for
          the benefit of the holders of the Senior Debt.

          The  consolidation  of the Company  with, or the merger of the Company
with or into,  another  person or the  liquidation or dissolution of the Company
following  the  conveyance,  transfer  or lease  of its  properties  and  assets
substantially as an entirety to another person upon the terms and conditions set
forth in Article  Five  hereof  shall not be deemed a  dissolution,  winding-up,
liquidation,  reorganization,   assignment  for  the  benefit  of  creditors  or
marshalling  of assets and  liabilities  of the Company for the purposes of this
Article if the person formed by such  consolidation  or the surviving  entity of
such merger or the person which acquires by  conveyance,  transfer or lease such
properties and assets  substantially as an entirety,  as the case may be, shall,
as a part of such consolidation,  merger, conveyance,  transfer or lease, comply
with the conditions set forth in such Article Five.

     Section  14.3  Suspension  of Payment  When  Designated  Senior  Debt is in
Default.

          (a) Unless Section 14.2 shall be applicable,  upon the occurrence of a
Payment Default,  no direct or indirect payment or distribution of any assets of
the  Company  of any  kind or  character  shall be made by or on  behalf  of the
Company on account of the Notes unless and until such Payment Default shall have
been cured or waived or shall have otherwise ceased to exist or such Senior Debt
shall have been  discharged  or paid in full in cash,  after  which,  subject to
Section  14.2 (if  applicable),  the  Company  shall  resume  making any and all
required payments in respect of the Notes, including any missed payments.

          (b) Unless Section 14.2 shall be  applicable,  upon (1) the occurrence
of a Non-payment Default and (2) receipt by the Trustee from the representatives
of any holders of Designated Senior Debt of written notice of such occurrence (a
"Payment Blockage  Notice") stating that a Non-Payment  Default has occurred and
is  continuing  pursuant  to Section  14.3(b) of this  Indenture,  no payment or
distribution of any assets of the Company of any kind or character shall be made
by or on behalf of the  Company on  account of the Notes for a period  ("Payment
Blockage  Period")  commencing  on the date of  receipt  by the  Trustee of such
notice unless and until the earlier to occur of the following events (subject to
any  blockage  of  payments  that may then be in effect  under  Section  14.2 or
subsection  (a) of this Section  14.3) (x) 179 days shall have elapsed since the
Payment  Blockage  Notice was  received  by the  Trustee,  (y) such  Non-payment
Default shall have been cured or waived or shall have ceased to exist  (provided
that no other Payment  Default or  Non-payment  Default has occurred and is then
continuing  after  giving  effect

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<PAGE>

to such cure or  waiver) or (z) such  Payment  Blockage  Period  shall have been
terminated   by  written   notice  to  the  Company  or  the  Trustee  from  the
representatives initiating such Payment Blockage Period, after which, subject to
Section 14.2 (if  applicable),  the Company shall promptly resume making any and
all required  payments in respect of the Notes,  including any missed  payments.
Notwithstanding  any other provision of this  Indenture,  during any consecutive
365-day period,  the aggregate number of days in which payments due on the Notes
may not be made as a result of  nonpayment  defaults on  Designated  Senior Debt
shall  not  exceed  179  days,  and  there  shall  be a period  of at least  186
consecutive days in each  consecutive  365-day period when such payments are not
prohibited. No event or circumstance that creates a default under any Designated
Senior Debt that (i) gives rise to the commencement of a Payment Blockage Period
or (ii)  exists at the  commencement  of or during any Payment  Blockage  Period
shall be made the basis for the commencement of any subsequent  Payment Blockage
Period  unless  such  default  has been cured or waived for a period of not less
than 90  consecutive  days  following the  commencement  of the initial  Payment
Blockage Period.

          (c) In the event that,  notwithstanding the foregoing,  the Trustee or
the  Holder  of any  Note  shall  have  received  any  payment  or  distribution
prohibited  by the foregoing  provisions of this Section 14.3,  then and in such
event such payment or distribution shall be paid over and delivered forthwith to
representatives  of the Holders or as a court of  competent  jurisdiction  shall
direct for  application to the payment of any due and unpaid Senior Debt, to the
extent  necessary  to pay all such due and  unpaid  Senior  Debt in cash,  after
giving effect to any concurrent payment to or for the holders of Senior Debt.

     Section 14.4  Trustee's Relation to Senior Debt.

          With respect to the holders of Senior Debt, the Trustee  undertakes to
perform  or to  observe  only  such  of its  covenants  and  obligations  as are
specifically  set forth in this Article  Fourteen (and in Article  Thirteen with
respect to existing and future Guarantor Senior Debt), and no implied  covenants
or  obligations  with  respect to the  holders of Senior Debt shall be read into
this Indenture  against the Trustee.  The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt and the Trustee shall not be liable
to any  holder of Senior  Debt if it shall  mistakenly  pay over or  deliver  to
Holders,  the Company,  the  Guarantor  or any other person  moneys or assets to
which any holder of Senior  Debt  shall be  entitled  by virtue of this  Article
Fourteen or otherwise.

     Section 14.5  Subrogation to Rights of Holders of Senior Debt.

          Upon the  payment in full in cash of all Senior  Debt,  the Holders of
the Notes shall be  subrogated  to the rights of the holders of such Senior Debt
to  receive  payments  and  distributions  of  cash,   property  and  securities
applicable  to the Senior Debt until the  principal of and interest on the Notes
shall  be  paid in full in  cash  or  cash  equivalents.  For  purposes  of such
subrogation,  no payments or  distributions to the holders of Senior Debt of any
cash,  property or  securities  to which the Holders of the Notes or the Trustee
would be entitled  except for the  provisions of this  Article,  and no payments
over pursuant to the provisions of this Article to the holders of Senior Debt by
Holders of the Notes or the Trustee shall,  as among the Company,  its creditors

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other than holders of Senior Debt, and the Holders of the Notes, be deemed to be
a payment or distribution by the Company to or on account of the Senior Debt.

          If any payment or  distribution  to which the Holders would  otherwise
have been entitled but for the  provisions of this Article  Fourteen  shall have
been  applied,  pursuant to the  provisions  of this  Article  Fourteen,  to the
payment of all amounts payable under the Senior Debt of the Company, then and in
such case the  Holders  shall be  entitled  to receive  from the holders of such
Senior Debt at the time  outstanding any payments or  distributions  received by
such holders of such Senior Debt in excess of the amount  sufficient  to pay all
amounts  payable under or in respect of such Senior Debt in full in cash or cash
equivalents.

     Section 14.6  Provisions Solely To Define Relative Rights.

          The  provisions of this Article  Fourteen are and are intended  solely
for the purpose of defining the  relative  rights of the Holders of the Notes on
the one hand and the holders of Senior Debt on the other hand. Nothing contained
in this  Article  Fourteen or  elsewhere  in this  Indenture  or in the Notes is
intended to or shall (a) impair, as among the Company,  its creditors other than
holders  of Senior  Debt and the  Holders of the Notes,  the  obligation  of the
Company, which is absolute and unconditional, to pay to the Holders of the Notes
the  principal  of,  premium,  if any, and interest on the Notes as and when the
same shall become due and payable in accordance  with their terms; or (b) affect
the  relative  rights  against  the  Company  of the  Holders  of the  Notes and
creditors of the Company  other than the holders of Senior Debt;  or (c) prevent
the Trustee or the Holder of any Note from  exercising  all  remedies  otherwise
permitted  by  applicable  law upon a Default or an Event of Default  under this
Indenture,  subject to the rights,  if any,  under this Article  Fourteen of the
holders of Senior Debt (1) in any case, proceeding, dissolution,  liquidation or
other winding up,  assignment for the benefit of creditors or other  marshalling
of assets  and  liabilities  of the  Company  referred  to in Section  14.2,  to
receive,  pursuant to and in accordance  with such Section,  cash,  property and
securities  otherwise  payable or deliverable to the Trustee or such Holder,  or
(2) under the  conditions  specified  in Section  14.3,  to prevent  any payment
prohibited by such Section or enforce their rights pursuant to Section 14.3(c).

          The failure to make a payment on the Notes by reason of any  provision
of this Article  Fourteen shall not be construed as preventing the occurrence of
a Default or an Event of Default hereunder.

     Section 14.7  Trustee To Effectuate Subordination.

          Each Holder of a Note by his acceptance thereof authorizes and directs
the Trustee on his behalf to take such action as may be necessary or appropriate
to effectuate the  subordination  provided in this Article Fourteen and appoints
the Trustee his  attorney-in-fact for any and all such purposes,  including,  in
the event of any dissolution,  winding-up,  liquidation or reorganization of the
Company  whether  in  bankruptcy,   insolvency,   receivership  proceedings,  or
otherwise,  the  timely  filing  of a  claim  for  the  unpaid  balance  of  the
Indebtedness  of the Company  owing to such Holder in the form  required in such
proceedings  and the causing of such claim to be  approved.  If the Trustee does
not file such a claim prior to 30 days before the expiration of the time to file

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<PAGE>

such a claim, the holders of Senior Debt, or any Senior Representative, may file
such a claim on behalf of Holders of the Notes.

     Section 14.8  No Waiver of Subordination Provisions.

          (a) No right of any  present or future  holder of any  Senior  Debt to
enforce  subordination  as  herein  provided  shall  at any  time  in any way be
prejudiced  or  impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith,  by any such  holder,  or by any
non-compliance  by the Company with the terms,  provisions and covenants of this
Indenture,  regardless of any  knowledge  thereof any such holder may have or be
otherwise charged with.

          (b) Without  limiting the generality of subsection (a) of this Section
14.8, the holders of Senior Debt may, at any time and from time to time, without
the  consent of or notice to the  Trustee or the  Holders of the Notes,  without
incurring  responsibility  to the Holders of the Notes and without  impairing or
releasing the subordination provided in this Article Fourteen or the obligations
hereunder of the Holders of the Notes to the holders of Senior Debt,  do any one
or more of the  following:  (1) change the manner,  place or terms of payment or
extend the time of payment of, or renew or alter,  Senior Debt or any instrument
evidencing the same or any agreement under which Senior Debt is outstanding; (2)
sell, exchange,  release or otherwise deal with any property pledged,  mortgaged
or otherwise  securing  Senior Debt; (3) release any person liable in any manner
for the  collection or payment of Senior Debt;  and (4) exercise or refrain from
exercising any rights against the Company and any other person; provided that in
no event shall any such  actions  limit the right of the Holders of the Notes to
take any action to accelerate the maturity of the Notes pursuant to Article Five
hereof or to pursue any rights or remedies hereunder or under applicable laws if
the  taking  of such  action  does  not  otherwise  violate  the  terms  of this
Indenture.

     Section 14.9  Notice to Trustee.

          (a) The Company shall give prompt written notice to the Trustee of any
fact known to the Company  which would  prohibit the making of any payment to or
by the Trustee in respect of the Notes.  Notwithstanding  the provisions of this
Article Fourteen or any other provision of this Indenture, the Trustee shall not
be charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the  Trustee in respect of the Notes,  unless and
until the Trustee shall have received written notice thereof from the Company or
a holder of Senior Debt or from any trustee,  fiduciary or agent therefor;  and,
prior to the receipt of any such written  notice,  the  Trustee,  subject to the
provisions  of this  Section  14.9,  shall be entitled in all respects to assume
that no such facts exist;  provided  that if the Trustee shall not have received
the notice provided for in this Section 14.9 at least two Business Days prior to
the date upon which by the terms  hereof any money may  become  payable  for any
purpose under this Indenture (including,  without limitation, the payment of the
principal of or interest on any Note),  then,  anything herein  contained to the
contrary  notwithstanding  but without  limiting  the rights and remedies of the
holders of Senior Debt or any trustee,  fiduciary or agent thereof,  the Trustee
shall have full power and  authority to receive such money and to apply the same
to the  purpose for which such money was  received  and shall not be affected by
any notice to the contrary  which may be received

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<PAGE>

by it within two  Business  Days prior to such  date;  nor shall the  Trustee be
charged with  knowledge of the curing of any such default or the  elimination of
the act or condition  preventing  any such payment  unless and until the Trustee
shall have received an Officers' Certificate to such effect.

          (b) Subject to the  provisions  of Section 5.1,  the Trustee  shall be
entitled to rely on the  delivery to it of a written  notice to the Trustee by a
person  representing  himself  to be a holder  of  Senior  Debt  (or a  trustee,
fiduciary or agent  therefor) to establish  that such notice has been given by a
holder of Senior Debt (or a trustee,  fiduciary or agent therefor). In the event
that the Trustee determines in good faith that further evidence is required with
respect to the right of any person as a holder of Senior Debt to  participate in
any payment or distribution  pursuant to this Article Fourteen,  the Trustee may
request such person to furnish  evidence to the reasonable  satisfaction  of the
Trustee as to the amount of Senior Debt held by such person, the extent to which
such person is entitled to participate in such payment or  distribution  and any
other facts pertinent to the rights of such person under this Article  Fourteen,
and if such evidence is not furnished, the Trustee may defer any payment to such
person pending judicial  determination as to the right of such person to receive
such payment.

     Section 14.10  Reliance on Judicial  Order or  Certificate  of  Liquidating
Agent.

          Upon any payment or distribution of assets of the Company  referred to
in this Article Fourteen, the Trustee, subject to the provisions of Section 5.1,
and the Holders,  shall be entitled to rely upon any order or decree  entered by
any  court of  competent  jurisdiction  in which  such  insolvency,  bankruptcy,
receivership,  liquidation,  reorganization,  dissolution, winding-up or similar
case or proceeding is pending,  or a certificate  of the trustee in  bankruptcy,
receiver, liquidating trustee, custodian, assignee for the benefit of creditors,
agent or other  person  making such  payment or  distribution,  delivered to the
Trustee or to the Holders,  for the purpose of ascertaining the persons entitled
to participate in such payment or  distribution,  the holders of Senior Debt and
other  Indebtedness of the Company,  the amount thereof or payable thereon,  the
amount or amounts  paid or  distributed  thereon and all other  facts  pertinent
thereto or to this Article; provided that the foregoing shall apply only if such
court has been fully apprised of the provisions of this Article Fourteen.

     Section 14.11 Rights of Trustee as a Holder of Senior Debt; Preservation of
Trustee's Rights.

          The Trustee in its  individual  capacity  shall be entitled to all the
rights set forth in this Article  Fourteen with respect to any Senior Debt which
may at any time be held by it, to the same extent as any other  holder of Senior
Debt,  and  nothing in this  Indenture  shall  deprive the Trustee of any of its
rights as such holder.  Nothing in this Article  Fourteen  shall apply to claims
of, or payments to, the Trustee under or pursuant to Section 6.7.

     Section 14.12  Article Applicable to Paying Agents.

          In case at any time any Paying Agent other than the Trustee shall have
been appointed by the Company and be then acting  hereunder,  the term "Trustee"
as used in this

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<PAGE>

Article shall in such case (unless the context otherwise  requires) be construed
as extending to and including  such Paying Agent within its meaning as fully for
all intents and  purposes  as if such  Paying  Agent were named in this  Article
Fourteen in addition to or in place of the  Trustee;  provided  that Section 3.1
shall not apply to the  Company or any  Affiliate  of the  Company if it or such
Affiliate acts as Paying Agent.

     Section 14.13  No Suspension of Remedies.

          Nothing  contained in this Article  Fourteen  shall limit the right of
the  Trustee  or the  Holders  of Notes to take any  action  to  accelerate  the
maturity  of the Notes  pursuant  to  Article  Four or to pursue  any  rights or
remedies hereunder or under applicable law, subject to the rights, if any, under
this Article Fourteen of the holders, from time to time, of Senior Debt.

                                   Article XV

                     OTHER PROVISIONS OF GENERAL APPLICATION

     Section 15.1  Trust Indenture Act Controls.

          This  Indenture  is  subject  to the  provisions  of the TIA which are
required to be part of this Indenture and shall,  to the extent  applicable,  be
governed by such provisions.

     Section 15.2   Notices.

          Any notice or  communication  to the  Company  or the  Trustee is duly
given if in writing  (which may be by facsimile with the original to follow) and
delivered  in  person or mailed by  first-class  mail to the  address  set forth
below:

          (a)  if to the Company:

          Foster Wheeler Ltd.
          Perryville Corporate Park
          Clinton, New Jersey  08809-4000

          with a copy to:

          White & Case LLP
          1155 Avenue of the Americas
          New York, NY 10036-2787
          Attn.:  Timothy B. Goodell, Esq.
          Fax:    (212) 354-8113

          (b)  if to the Trustee:

          BNY Midwest Trust Company
          Corporate Trust Division
          2 North La Salle Street
          Chicago, Illinois  60602
          Attn: Corporate Trust Administration

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<PAGE>

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

          Any notice or communication to a Holder shall be mailed by first-class
mail to his address shown on the Register kept by the Registrar. Failure to mail
a  notice  or  communication  to a  Holder  or any  defect  in  such  notice  or
communication shall not affect its sufficiency with respect to other Holders.

          If a notice or  communication is mailed or sent in the manner provided
above within the time prescribed,  it is duly given as of the date it is mailed,
whether or not the  addressee  receives  it,  except  that notice to the Trustee
shall be effective only upon receipt thereof by the Trustee.

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

     Section 15.3   Communication by Holders with Other Holders.

          Holders may  communicate  pursuant  to Section  312(b) of the TIA with
other  Holders  with  respect  to their  rights  under  the  Securities  or this
Indenture.  The Company,  the Trustee,  the Registrar and anyone else shall have
the protection of Section 312(c) of the TIA.

     Section 15.4  Acts of Holders of Securities.

          (a) Any request, demand,  authorization,  direction,  notice, consent,
waiver  or  other  action  provided  by this  Indenture  to be given or taken by
Holders of Securities may be embodied in and evidenced by:

               (1) one or more instruments of substantially similar tenor signed
          by such  Holders  in person  or by agent or proxy  duly  appointed  in
          writing;

               (2) the record of Holders of Securities  voting in favor thereof,
          either in person or by  proxies  duly  appointed  in  writing,  at any
          meeting of Holders of  Securities  duly called and held in  accordance
          with the provisions of Article 8; or

               (3) a combination of such instruments and any such record.

Except  as  herein  otherwise  expressly  provided,  such  action  shall  become
effective when such instrument or instruments or record or both are delivered to
the Trustee and, where it is hereby  expressly  required,  to the Company.  Such
instrument  or  instruments  and record  (and the action  embodied  therein  and
evidenced  thereby) are herein sometimes referred to as the "Act" of the Holders
of  Securities  signing such  instrument  or  instruments  and so voting at such
meeting.  Proof of execution of any such  instrument or of a writing  appointing
any such agent or proxy, or of the holding by any Person of a Security, shall be
sufficient  for any  purpose of this  Indenture  and

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<PAGE>

(subject to Section 5.1)  conclusive  in favor of the Trustee and the Company if
made in the  manner  provided  in this  Section.  The  record of any  meeting of
Holders of Securities shall be proved in the manner provided in Section 8.6.

          (b) The fact  and  date of the  execution  by any  Person  of any such
instrument or writing may be provided in any manner which the Trustee reasonably
deems sufficient.

          (c) The principal  amount and serial numbers of Securities held by any
Person,  and the date of such Person  holding  the same,  shall be proved by the
Register.

          (d) Any request, demand,  authorization,  direction,  notice, consent,
election,  waiver or other Act of the Holders of any  Security  shall bind every
future Holder of the same Security and the Holder of every Security  issued upon
the registration of transfer thereof or in exchange  therefor or in lieu thereof
in respect of  anything  done,  omitted or suffered to be done by the Trustee or
the Company in reliance thereon,  whether or not notation of such action is made
upon such Security.

     Section 15.5  Certificate and Opinion as to Conditions Precedent.

          In any case where several  matters are required to be certified by, or
covered by an opinion of, any specified  Person,  it is not  necessary  that all
such  matters  be  certified  by, or covered by the  opinion  of,  only one such
Person,  or that they be so certified or covered by only one  document,  but one
such Person may certify or give an opinion  with respect to some matters and one
or more other such Persons as to other matters,  and any such Person may certify
or give an opinion as to such matters in one or several documents.

          Any  certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon an Opinion of Counsel,  unless such
officer  knows,  or in the exercise of  reasonable  care should  know,  that the
Opinion of Counsel with respect to the matters  upon which such  certificate  or
opinion is based is erroneous. Any such Opinion of Counsel may be based, insofar
as it relates to factual matters,  upon a certificate or  representations  by an
officer or officers of the Company stating that the information  with respect to
such factual  matters is in the  possession  of the Company  unless such counsel
knows,  or in the exercise of reasonable  care should know, that the certificate
or representations with respect to such matters are erroneous.

          Where any Person is  required  to make,  give or  execute  two or more
applications,  requests, consents,  certificates,  statements, opinions or other
instruments  under this Indenture,  they may, but need not, be consolidated  and
form one instrument.

          Upon any  application or request by the Company to the Trustee to take
any action under any provision of this  Indenture,  the Company shall furnish to
the Trustee an Officers' Certificate stating that all conditions  precedent,  if
any,  provided for in this Indenture  relating to the proposed  action have been
complied  with and an  Opinion of Counsel  stating  that in the  opinion of such
Counsel all such conditions  precedent,  if any, have been complied with, except
that in the case of any such  application  or request as to which the furnishing
of such  documents is

                                       95

<PAGE>

specifically  required  by any  provision  of this  Indenture  relating  to such
particular  application or request, no additional certificate or opinion need be
furnished.

     Section  15.6   Statements   Required  in   Certificate   or  Opinion.

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

               (1) a statement that each individual  signing such certificate or
          opinion on behalf of the Company has read such  covenant or  condition
          and the definitions herein relating thereto;

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

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

               (4) a  statement  as to  whether,  in the  opinion  of each  such
          individual, such condition or covenant has been complied with.

     Section 15.7   Effect of Headings and Table of Contents.

          The Article and Section  headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.

     Section 15.8   Successors and Assigns.

          All  covenants and  agreements in this  Indenture by the Company shall
bind its respective successors and assigns, whether so expressed or not.

     Section 15.9  Separability Clause.

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

     Section 15.10   Benefits of Indenture.

          Nothing  contained in this Indenture or in the Securities,  express or
implied,  shall  give to any  Person,  other than the  parties  hereto and their
successors  hereunder  and the  Holders of  Securities,  any benefit or legal or
equitable right, remedy or claim under this Indenture.

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<PAGE>

     Section 15.11   Section Governing Law.

          THIS INDENTURE AND THE SECURITIES  SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

     Section 15.12   Submission to Jurisdiction; Consent to Service; Waivers.

          Each of the Company and Guarantor  agrees that any legal suit,  action
or  proceeding  against it arising out of or based upon this  Agreement,  may be
instituted  in any  United  States or New York  State  court in the  Borough  of
Manhattan, The City of New York, New York, and waives any objection which it may
now or hereafter have to the laying of venue of any such proceeding, and submits
to the  non-exclusive  jurisdiction  of such courts in any such suit,  action or
proceeding. Each of the Company and Guarantor hereby agrees to accept service of
process at the  address  set forth in Section  15.2 upon  which  process  may be
served in any such action arising out of or based on this Agreement which may be
instituted  in any  United  States or New York  State  court in the  Borough  of
Manhattan,  the City of New  York,  New  York,  and  expressly  consents  to the
jurisdiction  of any such  court,  but only in respect of any such  action,  and
waives any other  requirements  of or objections to personal  jurisdiction  with
respect thereto.

     Section 15.13   Counterparts.

          This instrument may be executed in any number of counterparts, each of
which  when  so  executed  shall  be  deemed  to be an  original  but  all  such
counterparts shall together constitute but one and the same instrument.

     Section 15.14    Legal Holidays.

          In  any  case  where  any  Interest  Payment  Date,  Redemption  Date,
Repurchase  Date or Stated  Maturity of any  Security or the last day on which a
Holder  of a  Security  has a right to  convert  such  Security  shall  not be a
Business   Day  at  any  Place  of   Payment  or  Place  of   Conversion,   then
(notwithstanding  any other  provision of this  Indenture or of the  Securities)
payment of interest  (including  Additional  Amounts,  if any) or  principal  or
premium, if any, or conversion of the Securities, need not be made at such Place
of  Payment  or Place of  Conversion  on such  day,  but may be made on the next
succeeding Business Day at such Place of Payment or Place of Conversion with the
same force and effect as if made on the Interest Payment Date,  Redemption Date,
Repurchase  Date or at the Stated  Maturity or on such last day for  conversion;
provided,  however,  that in the case that  payment  is made on such  succeeding
Business  Day, no interest  shall accrue on the amount so payable for the period
from and after such Interest Payment Date,  Redemption Date,  Repurchase Date or
Stated Maturity, as the case may be.

     Section 15.15   Recourse Against Others.

          No recourse for the payment of the principal of or premium, if any, or
interest  (including  Additional  Amounts,  if any) on any Securities or for any
claim based  thereon or otherwise in respect  thereof,  shall be had against any
incorporator,  shareholder,  officer or  director  or  manager,  as such,  past,
present or future,  of the Company or of any  successor  entity to the  Company,
whether  by  virtue  of  any  constitution,  statute  or  rule  of law or by the

                                       97

<PAGE>

enforcement of any assessment or penalty or otherwise, all such liability being,
by the  acceptance  thereof  and as part  of the  consideration  for  the  issue
thereof, expressly waived and released.

                                       98

<PAGE>

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

                                       FOSTER WHEELER LTD.

                                       By:  /s/  Lisa Fries Gardner
                                          --------------------------
                                          Name:  Lisa Fries Gardner
                                          Title:   Vice President and Secretary

                                        FOSTER WHEELER LLC

                                       By: /s/ Robert Iseman
                                          ---------------------------
                                          Name:    Robert Iseman
                                          Title:   Vice President

                                       BNY MIDWEST TRUST COMPANY

                                       By: /s/ Carolyn Potter
                                          ---------------------------
                                          Name:    Carolyn Potter
                                          Title:   Assistant Vice President

<PAGE>

                                                                      EXHIBIT A

                                FORM OF SECURITY

                               [FACE OF SECURITY]

[THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE REFERRED
TO HEREIN.  BENEFICIAL  INTERESTS IN THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED
EXCEPT IN ACCORDANCE WITH THE INDENTURE.

UNLESS THIS  CERTIFICATE  IS PRESENTED BY AN  AUTHORIZED  REPRESENTATIVE  OF THE
DEPOSITORY TRUST COMPANY ("DTC"), A NEW YORK CORPORATION, TO FOSTER WHEELER LTD.
(THE "COMPANY") OR ITS AGENT FOR REGISTRATION OF TRANSFER,  EXCHANGE OR PAYMENT,
AND ANY  CERTIFICATE  ISSUED IS  REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER  NAME AS IS  REQUESTED  BY AN  AUTHORIZED  REPRESENTATIVE  OF DTC (AND ANY
PAYMENT  IS MADE TO CEDE & CO. OR TO SUCH  OTHER  ENTITY AS IS  REQUESTED  BY AN
AUTHORIZED  REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL IN AS MUCH AS THE  REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]1/

[THE SECURITY  EVIDENCED BY THIS  CERTIFICATE HAS NOT BEEN REGISTERED  UNDER THE
SECURITIES  ACT OF  1933,  AS  AMENDED  (THE  "SECURITIES  ACT"),  OR ANY  STATE
SECURITIES  LAWS, AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO,
OR FOR THE  ACCOUNT  OR  BENEFIT  OF,  U.S.  PERSONS  EXCEPT AS SET FORTH IN THE
FOLLOWING SENTENCE. BY ACQUISITION HEREOF, THE HOLDER (1) (A) REPRESENTS THAT IT
IS A  "QUALIFIED  INSTITUTIONAL  BUYER"  AS  DEFINED  IN  RULE  144A  UNDER  THE
SECURITIES ACT OR (B) REPRESENTS THAT IT IS NOT A U.S. PERSON AND IS OUTSIDE THE
UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT  SATISFYING THE  REQUIREMENTS
OF) PARAGRAPH  (K)(2) OF RULE 902 OF REGULATION S UNDER THE SECURITIES  ACT; (2)
AGREES  THAT IT WILL NOT WITHIN TWO YEARS  AFTER THE  ORIGINAL  ISSUANCE OF THIS
SECURITY  RESELL OR  OTHERWISE  TRANSFER THE  SECURITY  EVIDENCED  HEREBY OR THE
COMMON  SHARES  ISSUABLE UPON  CONVERSION OF SUCH SECURITY  EXCEPT (A) TO FOSTER
WHEELER LTD. OR ANY SUBSIDIARY THEREOF,  (B) TO A QUALIFIED  INSTITUTIONAL BUYER
IN  COMPLIANCE  WITH RULE 144A  UNDER THE  SECURITIES  ACT,  (C) IN AN  OFFSHORE
TRANSACTION  IN  ACCORDANCE  WITH  RULE  903 OR 904 OF  REGULATION  S UNDER  THE
SECURITIES ACT, (D) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE
144 UNDER THE  SECURITIES  ACT (IF  AVAILABLE) OR (E) PURSUANT TO A REGISTRATION
STATEMENT  WHICH HAS BEEN DECLARED  EFFECTIVE UNDER THE SECURITIES ACT AND WHICH
CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH  TRANSFER;  AND (3) AGREES THAT IT
WILL DELIVER TO EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY IS TRANSFERRED
(OTHER THAN A TRANSFER PURSUANT TO CLAUSE 2(D)

                                       A-1

<PAGE>

ABOVE) A NOTICE  SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.  IN CONNECTION WITH
ANY  TRANSFER  OF THE  SECURITY  EVIDENCED  HEREBY  WITHIN  TWO YEARS  AFTER THE
ORIGINAL  ISSUANCE OF SUCH  SECURITY  (OTHER THAN A TRANSFER  PURSUANT TO CLAUSE
2(D) ABOVE),  THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE
HEREOF  RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS  CERTIFICATE  TO
THE TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE).  IF THE PROPOSED TRANSFER
IS  PURSUANT  TO CLAUSE 2(C) ABOVE,  THE HOLDER  MUST,  PRIOR TO SUCH  TRANSFER,
FURNISH  TO  THE  TRUSTEE  (OR  ANY  SUCCESSOR  TRUSTEE,   AS  APPLICABLE)  SUCH
CERTIFICATIONS,  LEGAL OPINIONS OR OTHER  INFORMATION AS FOSTER WHEELER LTD. MAY
REASONABLY  REQUIRE TO CONFIRM THAT SUCH  TRANSFER IS BEING MADE  PURSUANT TO AN
EXEMPTION  FROM,  OR  IN  A  TRANSACTION   NOT  SUBJECT  TO,  THE   REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED UPON THE EARLIER
OF THE TRANSFER OF THE SECURITY  EVIDENCED  HEREBY PURSUANT TO CLAUSE 2(D) ABOVE
OR THE  EXPIRATION  OF TWO YEARS  FROM THE  ORIGINAL  ISSUANCE  OF THE  SECURITY
EVIDENCED  HEREBY. AS USED HEREIN,  THE TERMS "UNITED STATES" AND "U.S.  PERSON"
HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.

THIS LEGEND WILL BE REMOVED  UPON THE  EARLIER OF THE  TRANSFER OF THE  SECURITY
EVIDENCED  HEREBY PURSUANT TO CLAUSE (2)(E) ABOVE OR THE EXPIRATION OF TWO YEARS
FROM THE ORIGINAL ISSUANCE OF THE SECURITY EVIDENCED HEREBY. AS USED HEREIN, THE
TERMS  "UNITED  STATES" AND "U.S.  PERSON"  HAVE THE  MEANINGS  GIVEN TO THEM BY
REGULATION S UNDER THE SECURITIES ACT.] 2/

                                      A-2

<PAGE>

                               FOSTER WHEELER LTD.

                  6.50% Convertible Subordinated Notes due 2007
                                  (the "Notes")

                                                              No. A-1

Original principal balance of all Note             Initial principal balance of
(including this Note): $200,000,000                this Note: $200,000,000

CUSIP:

          FOSTER  WHEELER  LTD., a Bermuda  Company (the  "Company",  which term
includes any successor corporation under the Indenture hereinafter referred to),
for value received,  hereby promises to pay to [ ] 3/ or its registered assigns,
the principal sum of TWO HUNDRED MILLION U.S. Dollars  ($200,000,000) on June 1,
2007.

          Interest Payment Dates: June 1 and December 1, commencing  December 1,
2001

          Regular Record Dates: May 15 and November 15

          Reference is hereby made to the further  provisions  of this  Security
set forth on the attached "Terms of Notes",  which further  provisions shall for
all purposes have the same effect as if set forth at this place.

                                      A-3

<PAGE>

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

Dated:  May 31, 2001

                                          FOSTER WHEELER LTD.

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

Trustee's Certificate of Authentication

This is one of the 6.50% Convertible
Subordinated Notes due 2007 described in
the within-named Indenture.

BNY MIDWEST TRUST COMPANY,
not in its individual capacity but solely as Trustee

By:
   ---------------------------------------
   Authorized Signatory

Dated:   May 31, 2001

                                      A-4

<PAGE>

                                 Terms of Notes

                              FOSTER WHEELER LTD.

                  6.50% Convertible Subordinated Notes due 2007

          Capitalized  terms used herein but not defined shall have the meanings
assigned to them in the Indenture referred to below unless otherwise indicated.

1.       Principal and Interest.

          Foster Wheeler Ltd., a Bermuda  company (the  "Company"),  promises to
pay interest on the principal  amount of this Security at the Interest Rate from
May 31, 2001 until repayment at Maturity,  redemption or repurchase. The Company
will  pay  interest  on this  Security  semiannually  in  arrears  on June 1 and
December 1 of each year (each an "Interest Payment Date"),  commencing  December
1, 2001.

          Interest  on the  Securities  shall  be  computed  (i)  for  any  full
semiannual  period for which a particular  Interest  Rate is  applicable  on the
basis of a 360-day  year of twelve  30-day  months  and (ii) for any  period for
which a particular  Interest Rate is applicable  shorter than a full  semiannual
period for which interest is calculated, on the basis of a 30-day month and, for
such  periods of less than a month,  the actual  number of days  elapsed  over a
30-day month.

          A Holder of any Security at the close of business on a Regular  Record
Date shall be entitled to receive interest on such Security on the corresponding
Interest  Payment  Date. A Holder of any Security  which is converted  after the
close of  business  on a  Regular  Record  Date and  prior to the  corresponding
Interest  Payment Date (other than any Security  whose Maturity is prior to such
Interest  Payment  Date) shall be entitled to receive  interest on the principal
amount of such Security,  notwithstanding  the conversion of such Security prior
to such Interest  Payment Date.  However,  any such Holder which  surrenders any
such Security for conversion  during the period between the close of business on
such  Regular  Record  Date and  ending  with the  opening  of  business  on the
corresponding  Interest  Payment  Date shall be  required  to pay the Company an
amount  equal to the  interest,  including  Additional  Amounts,  if any, on the
principal amount of such Security so converted,  which is payable by the Company
to such Holder on such Interest Payment Date, at the time such Holder surrenders
such Security for  conversion.  Notwithstanding  the foregoing,  any such Holder
which  surrenders  for  conversion  any  Security  which  has  been  called  for
redemption  by the  Company  in a notice  of  redemption  given  by the  Company
pursuant to Section  10.4 of the  Indenture  shall be  entitled to receive  (and
retain) such interest,  including  Additional  Amounts, if any, and need not pay
the Company an amount equal to the interest,  including  Additional  Amounts, if
any, on the  principal  amount of such  Security so  converted  at the time such
Holder surrenders such Security for conversion.

          In accordance  with the terms of the  Registration  Rights  Agreement,
dated as of May 31,  2001  (the  "Registration  Rights  Agreement"),  among  the
Company, the Guarantor and Lehman Brothers Inc., Banc of America Securities LLC,
and  First  Union  Securities,  Inc.,  during  the  first  60 days  following  a

                                       A-5

<PAGE>

Registration  Default (as defined in the  Registration  Rights  Agreement),  the
Interest Rate borne by the Securities shall be increased by 0.25% on:

               (A) August 30,  2001,  if the Shelf  Registration  Statement  (as
          defined in the Registration Rights Agreement) is not filed prior to or
          on August 29, 2001;

               (B) November 29, 2001 if the Shelf Registration  Statement is not
          declared effective by the Securities and Exchange  Commission prior to
          or on November 28, 2001;

               (C) Except during any period that the prospectus contained in the
          Shelf  Registration  Statement has been  suspended,  the day after the
          fifth Business Day after the Shelf Registration Statement,  previously
          declared effective, ceases to be effective or fails to be usable, if a
          post-effective  amendment  (or report  filed  pursuant to the Exchange
          Act) that cures the Shelf Registration Statement is not filed with the
          Securities  and  Exchange  Commission  during such five  Business  Day
          period; or

               (D) the day  following  the 45th or 60th day, as the case may be,
          of any period that the prospectus  contained in the Shelf Registration
          Statement  has  been  suspended,  if  such  suspension  has  not  been
          terminated.

From and after the 61st day following such  Registration  Default,  the Interest
Rate borne by the Securities  shall be increased by 0.50%. In no event shall the
Interest Rate borne by the Securities be increased by more than 0.50%.

          Any   amount  of   additional   interest   will  be  payable  in  cash
semiannually, in arrears, on each Interest Payment Date and will cease to accrue
on the date the  Registration  Default is cured.  The Holder of this Security is
entitled to the benefits of the Registration Rights Agreement.

2.   Guarantee

          This Note is entitled to that certain subordinated  Guarantee made for
the benefit of the Holders.  Reference is hereby made to Article Thirteen of the
Indenture for the terms relating to the Guarantee.

3.   Subordination

          The  Indebtedness  evidenced by the Notes is, to the extent and manner
provided in the  Indenture,  subordinate  and subject in right of payment to the
prior  payment in full in cash of all  existing  and future  Senior  Debt.  Each
Holder of this Note, by accepting the same,  (a) agrees to and shall be bound by
such  provisions,  (b)  authorizes  and directs the  Trustee,  on behalf of such
Holder, to take such action as may be necessary or appropriate to effectuate the
subordination  as  provided  in the  Indenture  and  (c)  appoints  the  Trustee
attorney-in-fact of such Holder for such purpose; provided that the Indebtedness
evidenced by this Note shall cease to be so subordinate  and subject in right of
payment upon any defeasance of this Note referred to in Paragraph 7 below.

                                       A-6

<PAGE>

4.   Method of Payment.

          Interest on any Security which is payable,  and is punctually  paid or
duly provided  for, on any Interest  Payment Date shall be paid to the person in
whose name that Security (or one or more  Predecessor  Securities) is registered
at the close of business on the Regular Record Date for such interest.

          Principal of, and premium, if any, and interest (including  Additional
Amounts,  if any) on,  Global  Securities  will be payable to the  Depositary in
immediately available funds.

          Principal and premium,  if any, on Physical Securities will be payable
at the office or agency of the Company  maintained  for such purpose,  initially
the  Corporate  Trust  Office of the  Trustee.  Interest  (including  Additional
Amounts, if any) on Physical Securities will be payable by (i) U.S. Dollar check
drawn on a bank in The City of New York  mailed  to the  address  of the  Person
entitled  thereto as such  address  shall appear in the  Register,  or (ii) upon
application to the Registrar not later than the relevant Record Date by a Holder
of an  aggregate  principal  amount in excess of  $5,000,000,  wire  transfer in
immediately  available funds, which application shall remain in effect until the
Holder notifies, in writing, the Registrar to the contrary.

5.   Paying Agent and Registrar.

          Initially, BNY Midwest Trust Company, the Trustee under the Indenture,
will act as Paying Agent and Registrar.  The Company may change the Paying Agent
or Registrar without notice to any Holder.

6.   Indenture.

          The Company issued this Security  under an Indenture,  dated as of May
29, 2001 (the "Indenture"),  among the Company and BNY Midwest Trust Company, as
trustee (the  "Trustee").  The terms of the Security include those stated in the
Indenture  and  those  made  part of the  Indenture  by  reference  to the Trust
Indenture Act of 1939, as amended ("TIA").  This Security is subject to all such
terms,  and Holders are referred to the Indenture and the TIA for a statement of
all such terms.  To the extent  permitted by applicable law, in the event of any
inconsistency between the terms of this Security and the terms of the Indenture,
the terms of the Indenture shall control.

7.   Defeasance.

          The Indenture  contains  provisions  (which  provisions  apply to this
Note) for defeasance at any time of (a) the entire  Indebtedness  of the Company
on this Note and (b) certain  restrictive  covenants  and related  Defaults  and
Events of Default,  in each case upon  compliance  by the Company  with  certain
conditions set forth therein.

                                       A-7

<PAGE>

8.   Optional Redemption.

          At any time on or after June 1, 2004,  the Company  may, at its option
and so long as the Trading Price of the Common Shares (multiplied by 100) equals
or exceeds 120% of the then prevailing  Conversion Price for at least 20 Trading
Days in any consecutive 30-day trading period, including the last Trading Day of
such  30-day  period,  ending on the  Trading  Day prior to the  issuance of the
Notice of Redemption  announcing such redemption  referred to in Section 10.4 of
the  Indenture,  redeem the Securities in whole at any time or in part from time
to time,  on any date  prior to  maturity,  upon  notice as set forth in Section
10.4, at the Redemption Price (expressed as percentages of the principal amount)
set forth below if redeemed on a Redemption  Date occurring  during the 12-month
period  beginning  June  1 of  the  years  indicated  and  ending  May 31 of the
following year.

                    During the Twelve Months Commencing         Redemption Price
                    -----------------------------------         ----------------

                              June 1, 2004                          103.90%
                              June 1, 2005                          102.60%
                              June 1, 2006                          101.30%

9.   General.

          Securities  in  original  denominations  larger  than  $1,000  may  be
redeemed in part. If any Security  selected for partial  redemption is converted
or repurchased in part before  termination of the conversion or repurchase right
with  respect to the  portion of the  Security so  selected,  the  converted  or
repurchased  portion of such Security shall be deemed to be the portion selected
for redemption (provided, however, that the Holder of such Security so converted
or  repurchased  and deemed  redeemed  shall not be entitled  to any  additional
interest  payment as a result of such deemed  redemption  than such Holder would
have  otherwise  been  entitled to receive upon  conversion  of such  Security).
Securities  which have been  converted  or  repurchased  during a  selection  of
Securities to be redeemed may be treated by the Trustee as  Outstanding  for the
purpose of such selection.

          On and after the  Redemption  Date,  interest shall cease to accrue on
Securities or portions of Securities  called for redemption,  unless the Company
defaults in the payment of the Redemption Price.

          Notice of  redemption  will be given by the  Company to the Holders as
provided in the Indenture.

10.  Repurchase Right Upon a Change of Control.

          If a Change  of  Control  occurs,  the  Holder of  Securities,  at the
Holder's option,  shall have the right, in accordance with the provisions of the
Indenture,  to require the Company to repurchase  the Securities (or any portion
of the principal amount hereof that is at least an integral  multiple of $1,000,
provided  that the  portion  of the  principal  amount  of this  Security  to be
Outstanding  after such  repurchase  is at least equal to $1,000) at 100% of the
principal amount of the Securities,  plus any interest accrued and unpaid to the
Repurchase Date.

                                       A-8

<PAGE>

          No  fractional  shares of Company  Common  Shares  will be issued upon
repurchase  of any  Securities.  Instead of any  fractional  share  which  would
otherwise be issued upon conversion of such Securities,  the Company shall pay a
cash adjustment as provided in the Indenture.

          A  Company  Notice  will be given by the  Company  to the  Holders  as
provided in the Indenture. To exercise a repurchase Right, a Holder must deliver
to the Trustee a written notice as provided in the Indenture.

11.  Conversion Rights.

          Subject to and upon  compliance  with the provisions of the Indenture,
the Holder of  Securities  is entitled,  at such  Holder's  option,  at any time
before the close of business on the Business Day  immediately  preceding June 1,
2007 to convert the Holder's  Securities (or any portion of the principal amount
hereof which is an integral multiple of $1,000), at the principal amount thereof
or of such portion, into duly authorized, fully paid and nonassessable shares of
Common  Shares of the Company at the  Conversion  Price in effect at the time of
conversion.

          In  the  case  of  a  Security  (or  a  portion  thereof)  called  for
redemption,  such  conversion  right in respect of the Security (or such portion
thereof) so called, shall expire at the close of business on the second Business
Day preceding the  Redemption  Date,  unless the Company  defaults in making the
payment  due upon  redemption.  In the case of a Change of Control for which the
Holder  exercises its Repurchase  Right with respect to a Security (or a portion
thereof),  such conversion right in respect of the Security (or portion thereof)
shall  expire  at the  close of  business  on the  Business  Day  preceding  the
Repurchase Date.

          The Conversion  Price shall be initially  equal to $16.05 per share of
Common   Shares.   The   Conversion   Price  shall  be  adjusted  under  certain
circumstances as provided in the Indenture.

          To  exercise  the  conversion  right,  the Holder must  surrender  the
Security  (or portion  thereof)  duly  endorsed or assigned to the Company or in
blank,  at the office of the  Conversion  Agent,  accompanied  by a duly  signed
conversion notice to the Company. Any Security surrendered for conversion during
the period from the close of business on any Regular  Record Date to the opening
of business on the corresponding  Interest Payment Date (other than any Security
whose  Maturity  is  prior  to  such  Interest  Payment  Date),  shall  also  be
accompanied  by  payment  in New  York  Clearing  House  funds  or  other  funds
acceptable  to the Company of an amount  equal to the  interest  payable on such
Interest   Payment  Date  on  the  principal  amount  of  the  Securities  being
surrendered for conversion.

          No fractional  shares of Common Shares will be issued upon  conversion
of any  Securities.  Instead of any fractional  shares which would  otherwise be
issued  upon  conversion  of  such  Securities,  the  Company  shall  pay a cash
adjustment as provided in the Indenture.

12.  Denominations; Transfer; Exchange.

          The Securities are issuable in registered form,  without  coupons,  in
denominations  of $1,000 and integral  multiples of $1,000 in excess thereof.  A
Holder may register the transfer or exchange of Securities  in  accordance  with
the  Indenture.  The  Registrar  may require a Holder,

                                       A-9

<PAGE>

among other things, to furnish  appropriate  endorsements and transfer documents
and the Company  may require a Holder to pay any taxes and fees  required by law
or permitted by the Indenture.

          In the event of a redemption in part, the Company will not be required
(a) to register the transfer of, or exchange, Securities for a period of 15 days
immediately preceding the date notice is given identifying the serial numbers of
the Securities  called for such redemption,  or (b) to register the transfer of,
or exchange, any such Securities, or portion thereof, called for redemption.

          In the event of redemption, conversion or repurchase of the Securities
in part only, a new Security or Securities  for the  unredeemed,  unconverted or
unrepurchased portion thereof will be issued in the name of the Holder hereof.

13.  Persons Deemed Owners.

          The  registered  Holder of this Security shall be treated as its owner
for all purposes.

14.  Unclaimed Money.

          The  Trustee  and the Paying  Agent shall pay to the Company any money
held by them for the payment of  principal,  premium,  if any, or interest  that
remains  unclaimed  for 18 months after the date upon which such  payment  shall
have become due.  After  payment to the Company,  Holders  entitled to the money
must look to the Company for payment as general  creditors  unless an applicable
abandoned  property law  designates  another  Person,  and all  liability of the
Trustee and such Paying Agent with respect to such money shall cease.

15.  Discharge Prior to Redemption or Maturity.

          Subject to certain conditions contained in the Indenture,  the Company
may discharge its obligations  under the Securities and the Indenture if (1) (a)
all of the  Outstanding  Securities  shall  become  due  and  payable  at  their
scheduled Maturity within one year or (b) all of the Outstanding  Securities are
scheduled  for  redemption  within  one year,  and (2) the  Company  shall  have
deposited with the Trustee money and/or U.S. Government  Obligations  sufficient
to pay the  principal  of, and  premium,  if any,  and  interest  on, all of the
Outstanding  Securities on the date of Maturity or  redemption,  as the case may
be.

16.  Amendment; Supplement; Waiver.

          The Indenture  permits,  with certain  exceptions as therein provided,
the amendment  thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the  Securities  under the Indenture at
any time by the  Company  and the  Trustee  with the consent of the Holders of a
majority in aggregate  principal  amount of the Outstanding  Securities (or such
lesser amount as shall have acted at a meeting pursuant to the provisions of the
Indenture).  The Indenture  also contains  provisions  permitting the Holders of
specified  percentages  in  principal  amount  of the  Securities  at  the  time
Outstanding, on behalf of the Holders of all the Securities, to waive compliance
by the Company  with  certain  provisions  of the  Indenture  and  certain  past
defaults under the Indenture and their consequences.  Any such consent or waiver
by the Holder of this

                                       A-10

<PAGE>

Security  shall be  conclusive  and binding upon such Holder and upon all future
Holders  of this  Security  and of any  Security  issued  upon  registration  of
transfer  hereof  or in  exchange  herefor  or in lieu  hereof,  whether  or not
notation  of such  consent  or waiver is made upon this  Security  or such other
Security.

          No reference herein to the Indenture and no provision of this Security
or of the Indenture  shall alter or impair the obligation of the Company,  which
is absolute and unconditional,  to pay the principal of and premium, if any, and
interest  (including  Additional Amounts, if any) on this Security at the times,
places and rate,  and in the coin or currency,  herein  prescribed or to convert
this Security (or pay cash in lieu of conversion) as provided in the Indenture.

17.  Defaults and Remedies.

          The Indenture  contains  provisions  (which  provisions  apply to this
Note) for defeasance at any time of (a) the entire  Indebtedness  of the Company
on this Note and (b) certain  restrictive  covenants  and related  Defaults  and
Events of Default,  in each case upon  compliance  by the Company  with  certain
conditions set forth therein.

18.  Authentication.

          This Security shall not be valid until the Trustee (or  authenticating
agent)  executes the  certificate  of  authentication  on the other side of this
Security.

19.  Abbreviations.

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

20.  Additional Rights of Holders of Transfer Restricted Securities.

          In addition to the rights  provided  to Holders  under the  Indenture,
Holders of Transfer Restricted Securities shall have all the rights set forth in
the Registration Rights Agreement.

21.  CUSIP Numbers.

          Pursuant to a  recommendation  promulgated by the Committee on Uniform
Security Identification  Procedures,  the Company has caused CUSIP numbers to be
printed on this  Security  and the Trustee  may use CUSIP  numbers in notices of
redemption  as a convenience  to Holders.  No  representation  is made as to the
accuracy of such numbers  either as printed on this  Security or as contained in
any  notice  of  redemption  and  reliance  may be  placed  only  on  the  other
identification numbers placed thereon.

22.  Governing Law.

          The Indenture and this Security shall be governed by, and construed in
accordance with, the law of the State of New York.

                                       A-11

<PAGE>

23.  Successor Corporation.

          In the event a successor  corporation  assumes all the  obligations of
the  Company  under  this  Security,  pursuant  to the terms  hereof  and of the
Indenture, the Company will be released from all such obligations.

                                      A-12

<PAGE>

                               [FORM OF GUARANTEE]

                             SUBORDINATED GUARANTEE

          For value received, the undersigned hereby unconditionally  guarantees
to the Holder of this Note the payments of principal  of,  premium,  if any, and
interest on this Note in the  amounts  and at the time when due and  interest on
the overdue principal,  premium, if any, and interest,  if any, of this Note, if
lawful,  and the payment or performance of all other  obligations of the Company
under the  Indenture  or the Notes,  to the Holder of this Note and the Trustee,
all in accordance  with and subject to the terms and  limitations  of this Note,
Article Thirteen of the Indenture and this Guarantee. This Guarantee will become
effective in  accordance  with Article  Thirteen of the  Indenture and its terms
shall be evidenced therein.  The validity and enforceability the Guarantee shall
not be affected by the fact that it is not affixed to any particular Note.

          The  obligations of the undersigned to the Holders of Notes and to the
Trustee  pursuant to the  Guarantee and the Indenture are expressly set forth in
Article  Thirteen of the Indenture and reference is hereby made to the Indenture
for the precise terms of the  Guarantee  and all of the other  provisions of the
Indenture to which this Guarantee  relates.  The Indebtedness  evidenced by this
Guarantee  is,  to the  extent  and in the  manner  provided  in the  Indenture,
subordinate and subject in right of payment to the prior payment in full in cash
of all Guarantor Senior Debt as defined in the Indenture,  and this Guarantee is
issued subject to such provisions. Each Holder of a Note, by accepting the same,
(a) agrees to and shall be bound by such provisions,  (b) authorizes and directs
the Trustee,  on behalf of such Holder,  to take such action as may be necessary
or appropriate to effectuate the  subordination as provided in the Indenture and
(c)  appoints  the Trustee  attorney-in-fact  of such  Holder for such  purpose;
provided  that such  subordination  provisions  shall  cease to  affect  amounts
deposited in accordance with the defeasance provisions of the Indenture upon the
terms and conditions set forth therein.

                                   FOSTER WHEELER LLC

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

                                      A-13

<PAGE>

                                 ASSIGNMENT FORM

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

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

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

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

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

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

Dated:                                       Your Name:
      ---------------------------                      -------------------------
                                             (Print  your  name  exactly  as  it
                                             appears   on  the   face   of  this
                                             Security)

                                             Your Signature:
                                                            --------------------
                                             (Sign  exactly as your name appears
                                             on the face of this Security)

                                            Signature Guarantee*:
                                                                 ---------------

         * Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).

                                      A-14

<PAGE>

In  connection  with any transfer of this Security  occurring  prior to the date
which is the earlier of the end of the period  referred to in Rule 144(k)  under
the Securities Act of 1933, as amended (the  "Securities  Act"), the undersigned
confirms that without utilizing any general  solicitation or general advertising
that:

                           [Check One]

[  ] (a)  this Security is being  transferred  in compliance  with the exemption
          from  registration  under the  Securities  Act  provided  by Rule 144A
          thereunder, and that the transfer has been effected pursuant to and in
          accordance  with Rule 144A under the Securities Act and,  accordingly,
          the  undersigned  does hereby further  certify that the Securities are
          being  transferred  to a transferee  that the  undersigned  reasonably
          believes is purchasing the Securities for its own account,  or for one
          or more accounts with respect to which such transferee  exercises sole
          investment discretion,  and such transferee and each such account is a
          "qualified  institutional  buyer"  within the meaning of Rule 144A, in
          each case in a transaction  meeting the  requirements of Rule 144A and
          in accordance with any applicable  securities laws of any state of the
          United States.

                           or

[  ] (b)  this Security is being  transferred  in compliance  with the exemption
          from  registration  under the  Securities Act provided by Regulation S
          thereunder,  and (A) the  offer  of the  Securities  was not made to a
          person in the United States; (B) either: (i) at the time the buy order
          was  originated,  the  transferee was outside the United States or the
          Transferor  and any person  acting on its behalf  reasonably  believed
          that  the  transferee  was  outside  the  United  States,  or (ii) the
          transaction  was  executed  in,  on or  through  the  facilities  of a
          designated  offshore  securities market and neither the Transferor nor
          any  person  acting  on its  behalf  knows  that the  transaction  was
          pre-arranged  with a  buyer  in the  United  States;  (C) no  directed
          selling efforts have been made in contravention of the requirements of
          Rule  903(b) or 904(b) of  Regulation  S, as  applicable;  and (D) the
          transaction is not part of a plan or scheme to evade the  registration
          requirements of the Securities Act.

                           or

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

                                      A-15

<PAGE>

If none of the foregoing boxes is checked,  the Trustee or other Registrar shall
not be obligated to register  this Security in the name of any Person other than
the Holder hereof unless the conditions to any such transfer of registration set
forth herein and in Sections 2.7, 2.8 and 2.9 of the  Indenture  shall have been
satisfied.

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

                                             Signature Guarantee:

                                             -----------------------------------
                                             Signature  must be  guaranteed by a
                                             participant    in   a    recognized
                                             signature     guaranty    medallion
                                             program    or    other    signature
                                             guarantor    acceptable    to   the
                                             Trustee.

                                      A-16

<PAGE>

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

          The  undersigned  represents  and warrants  that: (a) it is purchasing
this  Security  for its own  account  or an  account  with  respect  to which it
exercises sole investment discretion, in each case for investment and not with a
view to distribution;  (b) it and any such account is a "Qualified Institutional
Buyer" within the meaning of Rule 144A under the  Securities Act of 1933; (c) it
is aware that the sale to it is being  made in  reliance  on Rule  144A;  (d) it
acknowledges that it has received such information  regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such  information;  and (e) it is aware that the  transferor is relying upon the
undersigned's  foregoing  representations  in order to claim the exemption  from
registration provided by Rule 144A.

Dated:
      ----------------------------          ------------------------------------
                                             NOTICE:   To  be   executed  by  an
                                             executive officer

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

          The  undersigned  represents  and warrants that it is  purchasing  the
Securities  for its own account or an account with respect to which it exercises
sole  investment  discretion  and that it and any  such  account  are not  "U.S.
persons" as defined in Regulation S under the Securities Act.

Dated:
      ----------------------------          ------------------------------------
                                             NOTICE:   To  be   executed  by  an
                                             executive officer

                                      A-17

<PAGE>

                                CONVERSION NOTICE

TO:      FOSTER WHEELER LTD.
         Perryville Corporate Park
         Clinton, New Jersey  08809-4000

          The undersigned  registered owner of this Security hereby  irrevocably
exercises  the option to convert  this  Security,  or the  portion  hereof  (the
principal amount of which is an integral  multiple of $1,000) below  designated,
into Common Shares of the Company in accordance  with the terms of the Indenture
referred to in this Security,  and directs that the Common Shares of the Company
issuable  and  deliverable  upon  such  conversion,  together  with any check in
payment for fractional shares of Common Shares of the Company and any Securities
representing any unconverted principal amount hereof, be issued and delivered to
the registered  holder hereof unless a different name has been indicated  below.
The  undersigned  agrees to pay all  transfer  taxes  payable  in respect of the
conversion.  Any amount  required  to be paid to the  undersigned  on account of
interest (including Additional Amounts, if any) accompanies this Security.

Dated:                             Your Name:
      ----------------------                 -----------------------------------
                                   (Print your name exactly as it appears on the
                                   face of this Security)

                                   Your Signature:
                                                  ------------------------------
                                   (Sign  exactly  as your name  appears  on the
                                   face of this Security)

                                   Signature Guarantee*:
                                                        ------------------------

                                   Social    Security    or    other    Taxpayer
                                   Identification Number:
                                                         -----------------------

     Principal amount to be converted (if less than all): $

______________________

         * Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).

                                      A-18

<PAGE>

Fill in for registration of Common Shares of the Company (if to be issued) and
Securities (if to be delivered) other than to and in the name of the registered
holder:

                  -------------------------------------------------------------
                  (Name)

                  -------------------------------------------------------------
                  (Street Address)

                  -------------------------------------------------------------
                  (City, State and Zip Code)

                                      A-19

<PAGE>

                     NOTICE OF EXERCISE OF REPURCHASE RIGHT

TO:      FOSTER WHEELER LTD.
         Perryville Corporate Park
         Clinton, New Jersey  08809-4000

          The undersigned  registered owner of this Security hereby  irrevocably
acknowledges  receipt of a notice from Foster Wheeler Ltd. (the "Company") as to
the  occurrence  of a Change of Control with respect to the Company and requests
and instructs the Company to repay the entire principal amount of this Security,
or the portion thereof (the principal amount of which is an integral multiple of
$1,000) below designated, in accordance with the terms of the Indenture referred
to in this Security,  together with interest  (including  Additional Amounts, if
any) accrued and unpaid to, but excluding,  such date, to the registered  holder
hereof, in cash.

Dated:                             Your Name:
      ----------------------                 -----------------------------------
                                   (Print your name exactly as it appears on the
                                   face of this Security)

                                   Your Signature:
                                                  ------------------------------
                                   (Sign  exactly  as your name  appears  on the
                                   face of this Security)

                                   Signature Guarantee*:
                                                        ------------------------

                                   Social    Security    or    other    Taxpayer
                                   Identification Number:
                                                         -----------------------

     Principal amount to be converted (if less than all): $

____________________

     * Participant in a recognized  Signature  Guarantee  Medallion  Program (or
other signature guarantor acceptable to the Trustee).

                                      A-20

<PAGE>

                 SCHEDULE OF EXCHANGES FOR PHYSICAL SECURITIES1

          The following exchanges of a part of this Global Security for Physical
Securities have been made:

<TABLE>

<S>                     <C>                       <C>                        <C>                       <C>

                                                                             Principal Amount
                                                                             of this Global
                        Amount of decrease in     Amount of increase in      Security following        Signature of
                        Principal Amount of       Principal Amount of        such decrease             Authorized officer
   Date of Exchange     this Global Security      this Global Security       (or increase)             of Trustee
   ----------------     --------------------      --------------------       ----------------          ------------------

</TABLE>

____________________

     1  This  schedule  should be  included  only if the  Security  is issued in
        global form.

                                      A-21

<PAGE>

     1/   Insert if the Security is a Global Security.

     2/   Insert if the Security is a Restricted Security.

     3/   Insert "Cede & Co." if the Security is a Global Security.

                                      A-22EXHIBIT 4.6

                          Registration Rights Agreement

                                      among

                               FOSTER WHEELER LTD.

                               FOSTER WHEELER LLC

                                       and

                              Lehman Brothers Inc.
                         Banc of America Securities LLC
                          First Union Securities, Inc.

                            DATED AS OF MAY 31, 2001

<PAGE>

          REGISTRATION RIGHTS AGREEMENT,  dated as of May 31, 2001, among Foster
Wheeler  Ltd.,  a company  organized  under the laws of Bermuda  ("FW Ltd.") and
Foster Wheeler LLC, a Delaware Limited  Liability Company ("FW LLC" and together
with FW Ltd.,  the "FW  Parties")  and  Lehman  Brothers  Inc.,  Banc of America
Securities  LLC and First Union  Securities,  Inc.  (collectively,  the "Initial
Purchasers").

          Pursuant to the Purchase  Agreement,  dated May 24, 2001, among Lehman
Brothers Inc. for  themselves  and the other Initial  Purchasers  (the "Purchase
Agreement"),  the Initial Purchasers have agreed to purchase from the FW Ltd. up
to  $200,000,000  ($240,000,000  if the Initial  Purchasers  exercise the option
pursuant  to Section  2(b) of the  Purchase  Agreement  to  purchase  additional
securities in full) in aggregate principal amount of FW Ltd.'s 6.50% Convertible
Subordinated  Notes due 2007 (the "Notes").  The Notes will be convertible  into
fully paid, nonassessable common shares (the "Common Shares") of FW Ltd., on the
terms,  and subject to the  conditions,  set forth in the  Indenture (as defined
herein).  To induce the Initial Purchasers to purchase the Notes, the FW Parties
have agreed to provide the registration rights set forth in this Agreement.

          The parties hereby agree as follows:

          1. Definitions.  As used in this Agreement,  the following capitalized
terms shall have the following meanings:

          Advice: As defined in Section 4(c)(ii) hereof.

          Additional Amounts: As defined in Section 3(a) hereof.

          Affiliate:  As such term is defined  in Rule 405 under the  Securities
     Act.

          Agreement: This Registration Rights Agreement.

          Blue Sky Application: As defined in Section 6(a) hereof.

          Broker-Dealer: Any broker or dealer registered under the Exchange Act.

          Business  Day: A day other than a  Saturday  or Sunday or any  federal
     holiday in the United States.

          Commission: Securities and Exchange Commission.

          Common Shares: As defined in the preamble hereto.

          Damages Payment Date: Each Interest Payment Date. For purposes of this
     Agreement,  if no Notes are outstanding,  "Damages Payment Date" shall mean
     each date that would otherwise be an Interest Payment Date.

          Effectiveness Period: As defined in Section 2(a)(iii) hereof.

          Effectiveness Target Date: As defined in Section 2(a)(ii) hereof.

<PAGE>

          Exchange Act: Securities Exchange Act of 1934, as amended.

          Holder:  A  Person  who  owns,  beneficially  or  otherwise,  Transfer
     Restricted Securities.

          Indemnified Holder: As defined in Section 6(a) hereof.

          Indenture:  The  Indenture,  dated as of May 29,  2001,  among  the FW
     Parties and BNY Midwest Trust Company, as trustee (the "Trustee"), pursuant
     to which the Notes are to be issued, as such Indenture is amended, modified
     or supplemented from time to time in accordance with the terms thereof.

          Initial Purchasers: As defined in the preamble hereto.

          Interest Payment Date: As defined in the Indenture.

          Majority  of  Holders:  Holders  holding  more  than 50% in  aggregate
     principal  amount of the Notes  outstanding at the time of determination of
     the  Majority of Holders;  provided,  however,  that,  for purposes of this
     definition, a holder of Common Shares which constitutes Transfer Restricted
     Securities  that were  previously  issued upon conversion of Notes shall be
     deemed to hold an aggregate  principal  amount of Notes (in addition to the
     principal  amount of Notes held by such holder) equal to the product of (x)
     the number of such shares of Common  Shares held by such holder and (y) the
     prevailing  conversion price, such prevailing  conversion price as adjusted
     in accordance with Section 12.4 of the Indenture.

          NASD: National Association of Securities Dealers, Inc.

          Notes: As defined in the preamble hereto.

          Person:  An  individual,  partnership,   corporation,   unincorporated
     organization,   limited  liability  company,  trust,  joint  venture  or  a
     government or agency or political subdivision thereof.

          Prospectus: The prospectus included in a Shelf Registration Statement,
     as amended or  supplemented  by any prospectus  supplement and by all other
     amendments thereto,  including post-effective  amendments, and all material
     incorporated by reference into such Prospectus.

          Questionnaire Deadline: As defined in Section 2(b) hereof.

          Record Holder:  With respect to any Damages  Payment Date, each Person
     who is a Holder on the record  date with  respect to the  Interest  Payment
     Date on which such Damages Payment Date shall occur.

          Registration Default: As defined in Section 3(a) hereof.

                                      2

<PAGE>

          Sale Notice: As defined in Section 4(e) hereof.

          Securities Act: Securities Act of 1933, as amended.

          Shelf Filing Deadline: As defined in Section 2(a)(i) hereof.

          Shelf Registration Statement: As defined in Section 2(a)(i) hereof.

          Suspension Period. As defined in Section 4(b)(i) hereof.

          TIA:  Trust  Indenture  Act of  1939,  as in  effect  on the  date the
     Indenture is qualified under the TIA.

          Transfer  Restricted  Securities:  Each Note and each  share of Common
     Shares issued upon conversion of Notes until the earliest to occur of:

               (i) the date on which such Note or such Common Shares issued upon
          conversion has been  effectively  registered  under the Securities Act
          and disposed of in accordance with the Shelf Registration Statement;

               (ii) the date on which  such Note or such  Common  Shares  issued
          upon  conversion (A) has been  transferred in compliance with Rule 144
          under the Securities Act or (B) may be sold or transferred pursuant to
          Rule 144  under  the  Securities  Act  without  regard  to the  volume
          limitations  thereof (or any other similar  provision  then in force);
          and

               (iii) the date on which such Note or such  Common  Shares  issued
          upon  conversion  ceases  to be  outstanding  (whether  as a result of
          redemption, repurchase and cancellation, conversion or otherwise).

          Underwritten  Registration or Underwritten Offering: A registration in
     which the Notes or the Common Shares  received upon conversion of the Notes
     are sold to an underwriter for reoffering to the public; provided, however,
     that such  registration  or  offering  shall be made no more than two times
     under this Agreement and shall be for an offering of at least $40,000,000.

          2. Shelf Registration.

          (a) The FW Parties shall:

               (i) not later than 90 days after the  earliest  date of  original
          issuance of any of the Notes (the "Shelf  Filing  Deadline"),  cause a
          registration  statement  to be filed  pursuant  to Rule 415  under the
          Securities  Act (the  "Shelf  Registration  Statement"),  which  Shelf
          Registration  Statement  shall  provide  for  resales of all  Transfer
          Restricted   Securities   held  by  Holders  that  have  provided  the
          information required pursuant to the terms of Section 2(b) hereof;

                                       3

<PAGE>

               (ii) use their reasonable efforts to cause the Shelf Registration
          Statement to be declared effective by the Commission as promptly as is
          practicable  but in no event  later than 180 days  after the  earliest
          date of  original  issuance  of any of the Notes  (the  "Effectiveness
          Target Date"); and

               (iii) use their reasonable efforts to keep the Shelf Registration
          Statement continuously effective, supplemented and amended as required
          by the  provisions  of Section 4(b) hereof to the extent  necessary to
          ensure  that:  (A) it is  available  for  resales  by the  Holders  of
          Transfer  Restricted  Securities  entitled  to  the  benefit  of  this
          Agreement and (B) it conforms with the  requirements of this Agreement
          and the Securities Act and the rules and regulations of the Commission
          promulgated  thereunder as announced  from time to time,  for a period
          (the "Effectiveness Period") until the earliest of:

                    (1) two years  following the last date of original  issuance
               of any of the Notes; or

                    (2) the date when the  Holders  of the Notes and the  common
               shares issuable upon conversion of the Notes are able to sell all
               such securities  immediately without restriction  pursuant to the
               volume  limitation  provisions  of Rule 144 under the  Securities
               Act; or

                    (3) the date when all of the Notes and  Common  Shares  into
               which the Notes are convertible that are owned by the Holders who
               complete   and   deliver   in  a  timely   manner   the   selling
               securityholder  election  and  questionnaire  attached  hereto as
               Exhibit A are ---------  registered under the Shelf  Registration
               Statement and sold in accordance with it.

          (b) Not less than 30 calendar days prior to the  effectiveness  of the
Shelf   Registration   Statement,   the  FW  Parties  shall  mail  the  form  of
questionnaire  attached  hereto as  Exhibit A to each  Holder,  and no Holder of
Transfer  Restricted  Securities  may  include  any of its  Transfer  Restricted
Securities in the Shelf Registration Statement pursuant to this Agreement unless
such  Holder  furnishes  to the FW Parties in  writing,  prior to or on the 20th
calendar day after receipt of a request therefor (the "Questionnaire Deadline"),
such information as the FW Parties may reasonably  request for use in connection
with the Shelf  Registration  Statement or Prospectus or preliminary  Prospectus
included  therein  and in any  application  to be  filed  with  or  under  state
securities  laws. In  connection  with all such  requests for  information  from
Holders of Transfer  Restricted  Securities,  the FW Parties  shall  notify such
Holders of the  requirements set forth in the preceding  sentence.  No Holder of
Transfer Restricted  Securities shall be entitled to Additional Amounts pursuant
to Section 3 hereof unless such Holder shall have  provided all such  reasonably
requested information prior to or on the Questionnaire  Deadline. Each Holder as
to which the Shelf  Registration  Statement is being effected  agrees to furnish
promptly to the FW Parties all information  required to be disclosed in order to
make  information  previously  furnished  to the FW Parties  by such  Holder not
materially misleading.

                                       4

<PAGE>

          3. Additional Amounts.

          (a) If:

               (i) the  Shelf  Registration  Statement  is not  filed  with  the
          Commission prior to or on the Shelf Filing Deadline;

               (ii) the  Shelf  Registration  Statement  has not  been  declared
          effective by the Commission  prior to or on the  Effectiveness  Target
          Date;

               (iii) subject to the provisions of Section  4(b)(i)  hereof,  the
          Shelf  Registration  Statement  is filed and declared  effective  but,
          during  the  Effectiveness   Period,  shall  thereafter  cease  to  be
          effective or fail to be usable for its intended  purpose without being
          succeeded  within ten Business Days by a  post-effective  amendment to
          the Shelf Registration Statement or a report filed with the Commission
          pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act that
          cures such failure and, in the case of a post-effective  amendment, is
          itself immediately declared effective; or

               (iv) prior to or on the 45th or 60th day,  as the case may be, of
          any Suspension Period, such suspension has not been terminated,

(each  such  event  referred  to  in  foregoing  clauses  (i)  through  (iv),  a
"Registration  Default"),  the FW Parties hereby jointly and severally  agree to
pay the following additional amounts ("Additional  Amounts") with respect to the
Transfer  Restricted  Securities for which the Holders thereof have provided the
information  under the terms of Section 2(b) hereof,  from and including the day
following  the  Registration  Default up to but  excluding  the day on which the
Registration Default has been cured:

                    (A) in respect of the Notes,  to each  holder of Notes,  (x)
               with  respect  to  the  first  60-day   period   during  which  a
               Registration Default shall have occurred and be continuing, in an
               amount per year  equal to an  additional  0.25% of the  principal
               amount  of  the  Notes,  and  (y)  with  respect  to  the  period
               commencing  on the 61st day  following  the day the  Registration
               Default shall have occurred and be  continuing,  in an amount per
               year equal to an additional  0.50% of the principal amount of the
               Notes;  provided that in no event shall Additional Amounts accrue
               at a rate per year exceeding 0.50% of the principal amount of the
               Notes; and

                    (B) in respect of any Common Shares  issued upon  conversion
               of Notes, to each holder of such Common Shares,  (x) with respect
               to the first 60-day period in which a Registration  Default shall
               have occurred and be  continuing,  in an amount per year equal to
               0.25% of the principal  amount of the Notes  converted  into such
               Common Shares,  and (y) with respect to the period commencing the
               61st day  following the day the  Registration  Default shall have
               occurred and be continuing,  in an amount per year equal

                                       5

<PAGE>

               to 0.50% of the principal amount of the Notes converted into such
               Common  Shares;  provided,   however,  that  in  no  event  shall
               Additional  Amounts accrue at a rate per year exceeding  0.50% of
               the  principal  amount of the Notes  converted  into such  Common
               Shares.

          (b) All accrued  Additional Amounts shall be paid in arrears to Record
Holders by the FW Parties on each  Damages  Payment  Date in the same  manner as
interest  is  payable  pursuant  to  the  Notes.   Following  the  cure  of  all
Registration  Defaults  relating to any particular  Note or Common Shares issued
upon conversion of Notes, the accrual of Additional Amounts with respect to such
Note or such Common Shares shall cease.

          All  obligations  of the FW Parties  set forth in this  Section 3 with
respect to any Transfer  Restricted Security at the time such security ceases to
be a Transfer  Restricted  Security  shall  survive  until such time as all such
obligations  with respect to such Transfer  Restricted  Security shall have been
satisfied in full.

          The Additional  Amounts set forth above shall be the exclusive  remedy
available  to the Holders of Transfer  Restricted  Securities  for  Registration
Defaults.

          4. Registration Procedures.

          (a) In  connection  with  the  Shelf  Registration  Statement,  the FW
Parties  shall comply with all the  provisions  of Section 4(b) hereof and shall
use their reasonable  efforts to effect such  registration to permit the sale of
the Transfer Restricted Securities being sold thereunder,  and pursuant thereto,
shall as  expeditiously  as  practicable  prepare and file with the Commission a
Shelf  Registration  Statement  relating to the  registration on any appropriate
form under the Securities Act.

          (b) In  connection  with  the  Shelf  Registration  Statement  and any
Prospectus  required by this  Agreement to permit the sale or resale of Transfer
Restricted Securities, the FW Parties shall:

               (i)  Subject to any notice by the FW Parties in  accordance  with
          this  Section  4(b) of the  existence of any fact or event of the kind
          described in Section  4(b)(iii)(C),  use their  reasonable  efforts to
          keep the Shelf Registration  Statement  continuously  effective during
          the Effectiveness  Period; upon the occurrence of any event that would
          cause the Shelf  Registration  Statement or the  Prospectus  contained
          therein (A) to contain a material  misstatement or omission or (B) not
          be  effective  and  usable  for  the  resale  of  Transfer  Restricted
          Securities during the Effectiveness  Period, the FW Parties shall file
          promptly an appropriate amendment to the Shelf Registration  Statement
          or a report  filed with the  Commission  pursuant  to  Section  13(a),
          13(c),  14 or 15(d) of the  Exchange  Act,  in the case of clause (A),
          correcting  any such  misstatement  or  omission,  and, in the case of
          either clause (A) or (B), use their  reasonable  efforts to cause such
          amendment  to  be  declared   effective  and  the  Shelf  Registration
          Statement  and the  related  Prospectus  to  become  usable  for their
          intended purposes as soon as practicable  thereafter.

                                       6

<PAGE>

          Notwithstanding  the  foregoing,   the  FW  Parties  may  suspend  the
          effectiveness of the Shelf Registration Statement by written notice to
          the Holders for a period not to exceed an  aggregate of 45 days in any
          90-day period (each such period, a "Suspension Period") if:

                    (x) an event occurs and is  continuing  as a result of which
               the  Shelf  Registration  Statement  would,  in the  FW  Parties'
               reasonable  judgment,  contain an untrue  statement of a material
               fact or omit to  state a  material  fact  required  to be  stated
               therein  or  necessary  to  make  the   statements   therein  not
               misleading; and

                    (y) the FW Parties reasonably  determine that the disclosure
               of such event at such time would have a material  adverse  effect
               on the  business  of FW Ltd.  (and its  subsidiaries,  taken as a
               whole);

          provided,  however,  that in the event  the  disclosure  relates  to a
          previously   undisclosed   proposed  or  pending   material   business
          transaction,  the  disclosure  of which  would  impede the FW Parties'
          ability to consummate  such  transaction,  the FW Parties may extend a
          Suspension  Period from 45 days to 60 days;  provided,  however,  that
          Suspension  Periods  shall not exceed an  aggregate of 120 days in any
          360-day period.

               (ii) Except during a Suspension  Period, (A) use their reasonable
          efforts to prepare and file with the  Commission  such  amendments and
          post-effective  amendments to the Shelf Registration  Statement as may
          be necessary to keep the Shelf Registration Statement effective during
          the Effectiveness  Period; (B) cause the Prospectus to be supplemented
          by any required  Prospectus  supplement,  and as so supplemented to be
          filed  pursuant to Rule 424 under the  Securities  Act,  and to comply
          fully with the  applicable  provisions of Rules 424 and 430A under the
          Securities Act in a timely manner;  and (C) comply with the provisions
          of  the  Securities  Act  with  respect  to  the  disposition  of  all
          securities  covered  by the Shelf  Registration  Statement  during the
          applicable period in accordance with the intended method or methods of
          distribution   by  the   sellers   thereof  set  forth  in  the  Shelf
          Registration Statement or supplement to the Prospectus.

               (iii)  Advise the  underwriter(s),  if any,  and selling  Holders
          promptly  (but  in any  event  within  five  Business  Days)  and,  if
          requested by such Persons, to confirm such advice in writing:

                    (A) when the  Prospectus  or any  Prospectus  supplement  or
               post-effective amendment has been filed, and, with respect to the
               Shelf  Registration  Statement  or any  post-effective  amendment
               thereto, when the same has become effective,

                    (B) of the  issuance  by the  Commission  of any stop  order
               suspending the effectiveness of the Shelf Registration  Statement
               under  the

                                       7

<PAGE>

               Securities  Act or of the  suspension  by  any  state  securities
               commission  of  the  qualification  of  the  Transfer  Restricted
               Securities  for  offering  or  sale in any  jurisdiction,  or the
               initiation of any proceeding  for any of the preceding  purposes,
               or

                    (C) except during a Suspension  Period,  of the existence of
               any fact or the happening of any event,  during the Effectiveness
               Period,  that makes any  statement of a material fact made in the
               Shelf Registration  Statement,  the Prospectus,  any amendment or
               supplement  thereto,  or any document  incorporated  by reference
               therein  untrue,  or that requires the making of any additions to
               or changes in the Shelf Registration  Statement or the Prospectus
               in order to make the statements therein not misleading.

               (iv) If at any time the  Commission  shall  issue any stop  order
          suspending the effectiveness of the Shelf Registration  Statement,  or
          any state securities  commission or other  regulatory  authority shall
          issue  an  order  suspending  the   qualification  or  exemption  from
          qualification  of  the  Transfer  Restricted  Securities  under  state
          securities or Blue Sky laws,  use their  reasonable  efforts to obtain
          the withdrawal or lifting of such order at the earliest possible time.

               (v) Furnish to each of the selling  Holders  upon request by such
          selling  Holders  and to each of the  underwriter(s),  if any,  before
          filing with the Commission, a copy of the Shelf Registration Statement
          and copies of any  Prospectus  included  therein or any  amendments or
          supplements to the Shelf  Registration  Statement or Prospectus (other
          than documents  incorporated  by reference after the initial filing of
          the Shelf Registration Statement),  which documents will be subject to
          the review of such Holders and underwriter(s), if any, for a period of
          at least three  Business  Days after the receipt  thereof,  and the FW
          Parties will not file the Shelf  Registration  Statement or Prospectus
          or any amendment or supplement to the Shelf Registration  Statement or
          Prospectus (other than documents incorporated by reference) to which a
          selling Holder of Transfer Restricted  Securities covered by the Shelf
          Registration Statement or the underwriter(s), if any, shall reasonably
          object  within  three  Business  Days after the receipt  thereof.  The
          objection of a selling Holder or underwriter,  if any, shall be deemed
          to be  reasonable  if the  Shelf  Registration  Statement,  amendment,
          Prospectus  or  supplement,  as  applicable,  as proposed to be filed,
          contains a material  misstatement  or  omission  required to be stated
          therein or necessary to make the  statements  therein,  in the case of
          the  Prospectus  in light of the  circumstances  under which they were
          made, not misleading.

               (vi)  If  reasonably  requested  by any  selling  Holders  or the
          underwriter(s),  if any,  within ten business days  incorporate in the
          Shelf Registration  Statement or Prospectus,  pursuant to a supplement
          or  post-effective  amendment if necessary,  such  information as such
          selling  Holders  and  underwriter(s),  if any,  may from time to time
          reasonably  request  to  have  included  therein,  including,  without
          limitation:   (A)   information   concerning   such   Holder  and  the
          underwriter(s),   if  any,  and  the

                                       8

<PAGE>

          distribution of the Transfer Restricted  Securities of such Holders or
          underwriters(s),  if any;  (B)  information  relating  to the "Plan of
          Distribution" of the Transfer Restricted  Securities;  (C) information
          with  respect  to the  principal  amount  of Notes or number of shares
          Common  Shares  being sold to such  underwriter(s);  (D) the  purchase
          price being paid therefor;  and (E) any other terms of the offering of
          the Transfer  Restricted  Securities to be sold in such offering,  and
          make  all  required   filings  of  such   Prospectus   supplement   or
          post-effective  amendment as soon as reasonably  practicable after the
          FW Parties  are  notified of the  matters to be  incorporated  in such
          Prospectus supplement or post-effective amendment.

               (vii)   Furnish   to  each   selling   Holder  and  each  of  the
          underwriter(s), if any, without charge, at least one copy of the Shelf
          Registration  Statement,  as first filed with the  Commission,  and of
          each  amendment  thereto (and as such Person may request any documents
          incorporated  by  reference  therein or exhibits  thereto (or exhibits
          incorporated in such exhibits by reference)).

               (viii)   Deliver  to  each   selling   Holder  and  each  of  the
          underwriter(s),  if  any,  without  charge,  as  many  copies  of  the
          Prospectus  (including each preliminary  prospectus) and any amendment
          or supplement thereto as such Persons reasonably may request;  subject
          to any notice by the FW Parties in  accordance  with this Section 4(b)
          of the existence of any fact or event of the kind described in Section
          4(b)(iii)(C),  the  FW  Parties  hereby  consent  to  the  use  of the
          Prospectus  and any  amendment  or  supplement  thereto by each of the
          selling Holders and each of the underwriter(s),  if any, in connection
          with the offering and the sale of the Transfer  Restricted  Securities
          covered by the Prospectus or any amendment or supplement thereto.

               (ix)  If an  underwriting  agreement  is  entered  into  and  the
          registration is an Underwritten Registration, the FW Parties shall:

                    (A) upon  request,  furnish to each selling  Holder and each
               underwriter,  if any,  in such  substance  and  scope as they may
               reasonably  request  and as are  customarily  made by  issuers to
               underwriters in primary underwritten offerings,  upon the date of
               closing  of any  sale of  Transfer  Restricted  Securities  in an
               Underwritten Registration:

                         (1) a  certificate,  dated  the  date of such  closing,
                    signed by a Chief Executive  Officer and the Chief Financial
                    Officer of FW Ltd.  confirming,  as of the date thereof, the
                    matters set forth in Section 8(j) of the Purchase Agreement;

                         (2) opinions,  each dated the date of such closing,  of
                    counsel to the FW Parties  covering  such of the  matters as
                    are customarily covered in legal opinions to underwriters in
                    connection   with   primary   underwritten    offerings   of
                    securities;

                                       9

<PAGE>

                         (3) customary  comfort letters,  dated the date of such
                    closing,  from the  independent  accountants of FW Ltd. (and
                    from any other  accountants  whose  report is  contained  or
                    incorporated   by  reference   in  the  Shelf   Registration
                    Statement),  in the customary  form and covering  matters of
                    the  type   customarily   covered  in  comfort   letters  to
                    underwriters   in  connection   with  primary   underwritten
                    offerings of securities; and

                         (4) a  certificate  of the Chief  Financial  Officer of
                    Foster   Wheeler   Corporation,   in  form   and   substance
                    satisfactory  to such selling Holder  containing  statements
                    and  information  of the type  satisfactory  to such selling
                    with respect to "backlog" numbers in the Prospectus.

                    (B) set forth in full in the underwriting agreement, if any,
               indemnification provisions and procedures which provide rights no
               less  protective  than those set forth in  Section 6 hereof  with
               respect to all parties to be indemnified; and

                    (C) deliver such other documents and  certificates as may be
               reasonably  requested by such parties to evidence compliance with
               clause (A) above and with any customary  conditions  contained in
               the underwriting agreement or other agreement entered into by the
               selling Holders pursuant to this clause (x).

               (x) Before any public offering of Transfer Restricted Securities,
          cooperate with the selling Holders,  the  underwriter(s),  if any, and
          their  respective  counsel in  connection  with the  registration  and
          qualification  of  the  Transfer   Restricted   Securities  under  the
          securities  or Blue  Sky  laws of such  jurisdictions  as the  selling
          Holders or  underwriter(s),  if any, may reasonably request and do any
          and all other  acts or things  necessary  or  advisable  to enable the
          disposition  in  such   jurisdictions   of  the  Transfer   Restricted
          Securities  covered  by the Shelf  Registration  Statement;  provided,
          however,  that the FW Parties shall not be required (A) to register or
          qualify as a foreign  corporation or a dealer of securities where they
          are not now so qualified or to take any action that would subject them
          to the service of process in any  jurisdiction  where they are not now
          so  subject  or (B) to  subject  themselves  to  taxation  in any such
          jurisdiction if they are not now so subject.

               (xi) Cooperate with the selling  Holders and the  underwriter(s),
          if  any,  to  facilitate  the  timely   preparation  and  delivery  of
          certificates  representing  Transfer Restricted  Securities to be sold
          and not bearing any restrictive legends (unless required by applicable
          securities laws) and enable such Transfer Restricted  Securities to be
          in such  denominations  and registered in such names as the Holders or
          the  underwriter(s),  if any, may request at least two  Business  Days
          before  any  sale  of  Transfer  Restricted  Securities  made  by such
          underwriter(s).

                                       10

<PAGE>

               (xii)  Use  their  reasonable   efforts  to  cause  the  Transfer
          Restricted  Securities covered by the Shelf Registration  Statement to
          be  registered  with or  approved  by  such  other  U.S.  governmental
          agencies or  authorities  as may be  necessary to enable the seller or
          sellers  thereof or the  underwriter(s),  if any,  to  consummate  the
          disposition of such Transfer Restricted Securities.

               (xiii) Subject to Section  4(b)(i)  hereof,  if any fact or event
          contemplated  by  Section  4(b)(iii)(C)  hereof  shall  exist  or have
          occurred,  use their  reasonable  efforts to prepare a  supplement  or
          post-effective  amendment  to  the  Shelf  Registration  Statement  or
          related Prospectus or any document  incorporated  therein by reference
          or file any other required  document so that, as thereafter  delivered
          to the purchasers of Transfer  Restricted  Securities,  the Prospectus
          will not  contain an untrue  statement  of a material  fact or omit to
          state any material fact required to be stated  therein or necessary to
          make the statements therein not misleading.

               (xiv)  Provide   CUSIP   numbers  for  all  Transfer   Restricted
          Securities not later than the effective date of the Shelf Registration
          Statement   and  provide  the  Trustee   under  the   Indenture   with
          certificates  for the Notes that are in a form  eligible  for  deposit
          with The Depository Trust Company.

               (xv) Cooperate and assist in any filings required to be made with
          the NASD and in the performance of any due diligence  investigation by
          any underwriter that is required to be retained in accordance with the
          rules and regulations of the NASD.

               (xvi) Otherwise use their  reasonable  efforts to comply with all
          applicable  rules and  regulations of the Commission and all reporting
          requirements under the rules and regulations of the Exchange Act.

               (xvii)  Cause the  Indenture  to be  qualified  under the TIA not
          later  than the  effective  date of the Shelf  Registration  Statement
          required by this Agreement,  and, in connection  therewith,  cooperate
          with the Trustee  and the  holders of Notes to effect such  changes to
          the Indenture as may be required for such Indenture to be so qualified
          in  accordance  with the terms of the TIA,  and  execute and use their
          reasonable  efforts to cause the  Trustee  thereunder  to execute  all
          documents  that may be required  to effect such  changes and all other
          forms and documents required to be filed with the Commission to enable
          such Indenture to be so qualified in a timely manner.

               (xviii) Cause all Common Shares  issuable upon the  conversion of
          the Transfer  Restricted  Securities covered by the Shelf Registration
          Statement  to be  listed  or  quoted,  as the  case  may  be,  on each
          securities  exchange or automated  quotation  system on which  similar
          securities issued by any of the FW Parties are then listed or quoted.

                                       11

<PAGE>

               (xix) Provide  promptly to each Holder upon written  request each
          document filed with the  Commission  pursuant to the  requirements  of
          Section 13 and Section 15 of the Exchange Act after the effective date
          of the Shelf Registration Statement.

               (xx) In connection with an Underwritten  Offering,  if reasonably
          requested by the  underwriters,  make  appropriate  officers of the FW
          Parties  reasonably  available to the  underwriters  for meetings with
          prospective  purchasers  of the  Transfer  Restricted  Securities  and
          prepare  and  present to  potential  investors  customary  "road show"
          material  in a manner  consistent  with other new  issuances  of other
          securities similar to the Transfer Restricted Securities.

          (c)  Each  Holder  agrees  by  acquisition  of a  Transfer  Restricted
Security  that,  upon receipt of any notice from the FW Parties of the existence
of any fact of the kind described in Section  4(b)(iii)(C)  hereof,  such Holder
will,  and will use its  reasonable  efforts to cause any  underwriter(s)  in an
Underwritten  Offering  to,  (A) hold  any such  notice  in  confidence  and (B)
forthwith discontinue  disposition of Transfer Restricted Securities pursuant to
the Shelf Registration Statement until:

               (i) such  Holder  has  received  copies  of the  supplemented  or
          amended Prospectus contemplated by Section 4(b)(xiii) hereof; or

               (ii) such Holder is advised in writing  (the  "Advice") by the FW
          Parties  that  the  use of the  Prospectus  may be  resumed,  and  has
          received  copies of any  additional or  supplemental  filings that are
          incorporated by reference in the Prospectus.

If so directed by the FW Parties, each Holder will deliver to the FW Parties (at
the FW Parties'  expense) all copies,  other than  permanent file copies then in
such Holder's  possession,  of the Prospectus  covering such Transfer Restricted
Securities that was current at the time of receipt of such notice of suspension.

          (d) Each  Holder who  intends  to be named as a selling  Holder in the
Shelf Registration Statement shall furnish to the FW Parties in writing,  within
20  Business  Days  after  receipt  of a  request  therefor  as set  forth  in a
questionnaire,   such  information   regarding  such  Holder  and  the  proposed
distribution  by such Holder of its  Transfer  Restricted  Securities  as the FW
Parties may reasonably request for use in connection with the Shelf Registration
Statement or Prospectus or preliminary Prospectus included therein. (The form of
the questionnaire is attached hereto as Exhibit A.) Holders that do not complete
the questionnaire and deliver it to the FW Parties shall not be named as selling
securityholders  in the  Prospectus or  preliminary  Prospectus  included in the
Shelf  Registration  Statement and therefore  shall not be permitted to sell any
Transfer  Restricted  Securities  pursuant to the Shelf Registration  Statement.
Each  Holder  who  intends  to  be  named  as a  selling  Holder  in  the  Shelf
Registration  Statement shall promptly furnish to the FW Parties in writing such
other information as the FW Parties may from time to time reasonably  request in
writing.

                                       12

<PAGE>

          (e) Upon the effectiveness of the Shelf Registration  Statement,  each
Holder  shall  notify the FW Parties at least three  Business  Days prior to any
intended  distribution of Transfer  Restricted  Securities pursuant to the Shelf
Registration  Statement (a "Sale  Notice"),  which notice shall be effective for
five Business Days. Each Holder of this Security,  by accepting the same, agrees
to hold any  communication  by the FW Parties in  response  to a Sale  Notice in
confidence.

          5. Registration Expenses.

          (a)  All  expenses  incident  to the  FW  Parties'  performance  of or
compliance  with this Agreement  shall be borne by the FW Parties  regardless of
whether a Shelf  Registration  Statement becomes effective,  including,  without
limitation:

               (i) all  registration  and filing  fees and  expenses  (including
          filings made by any Initial Purchasers or Holders with the NASD);

               (ii) all fees and expenses of compliance with federal  securities
          and state Blue Sky or securities laws;

               (iii)  all   expenses   of   printing   (including   printing  of
          Prospectuses  and  certificates  for Common  Shares to be issued  upon
          conversion  of  the  Notes),   messenger  and  delivery  services  and
          telephone;

               (iv) all fees and disbursements of counsel to the FW Parties and;

               (v) all  application  and filing fees in connection  with listing
          (or  authorizing  for  quotation)  the  Common  Shares  on a  national
          securities  exchange or  automated  quotation  system  pursuant to the
          requirements hereof; and

               (vi) all fees and  disbursements of independent  certified public
          accountants  of the FW Parties  (including the expenses of any special
          audit  and   comfort   letters   required   by  or  incident  to  such
          performance).

          (b) The FW  Parties  shall bear their  internal  expenses  (including,
without  limitation,  all salaries and expenses of their  officers and employees
performing legal,  accounting or other duties), the expenses of any annual audit
and the fees and expenses of any Person, including special experts,  retained by
the FW Parties.  Nothing  herein shall mean that the FW Parties are  responsible
for the payment of any fees or commissions of the  underwriters or underwriters'
counsel in connection with an Underwritten Offering.

          6. Indemnification and Contribution.

          (a) The FW Parties shall,  jointly and  severally,  indemnify and hold
harmless each Holder,  such Holder's  officers and employees and each person, if
any, who controls such Holder within the meaning of the Securities Act (each, an
"Indemnified  Holder"),  from and against any loss, claim,  damage or liability,
joint or several, or any action in respect thereof  (including,  but not limited
to, any loss,  claim,  damage,  liability  or action  relating to resales of the
Transfer  Restricted

                                       13

<PAGE>

Securities), to which such Indemnified Holder may become subject, insofar as any
such loss, claim, damage, liability or action arises out of, or is based upon:

               (i)  any  untrue  statement  or  alleged  untrue  statement  of a
          material  fact  contained  in  the  Shelf  Registration  Statement  or
          Prospectus or any amendment or supplement thereto; or

               (ii) the  omission  or  alleged  omission  to state  therein  any
          material fact  required to be stated  therein or necessary to make the
          statements  therein,  in light of the  circumstances  under which they
          were made, not misleading,

and shall reimburse each  Indemnified  Holder promptly upon demand for any legal
or other expenses  reasonably  incurred by such Indemnified Holder in connection
with  investigating  or defending or preparing to defend  against any such loss,
claim,  damage,  liability or action as such  expenses are  incurred;  provided,
however,  that the FW Parties shall not be liable in any such case to the extent
that any such loss,  claim,  damage,  liability  or action  arises out of, or is
based upon,  any untrue  statement  or alleged  untrue  statement or omission or
alleged  omission  made in the Shelf  Registration  Statement or  Prospectus  or
amendment or supplement  thereto in reliance upon and in conformity with written
information  furnished  to the FW  Parties by or on behalf of any Holder (or its
related  Indemnified  Holder)   specifically  for  use  therein.  The  foregoing
indemnity  agreement  is in addition to any  liability  which the FW Parties may
otherwise have to any Indemnified Holder.

          (b) Each Holder,  severally and not jointly,  shall indemnify and hold
harmless the FW Parties and their  officers,  directors,  managers and employees
and each person,  if any, who controls any of the FW Parties  within the meaning
of the Securities  Act, from and against any loss,  claim,  damage or liability,
joint or several,  or any action in respect thereof,  to which the FW Parties or
any such officer,  director,  manager, employee or controlling person may become
subject,  insofar as any such loss, claim,  damage or liability or action arises
out of, or is based upon:

               (i) any untrue  statement  or  alleged  untrue  statement  of any
          material  fact  contained  in  the  Shelf  Registration  Statement  or
          Prospectus or any amendment or supplement thereto; or

               (ii) the  omission or the alleged  omission to state  therein any
          material fact  required to be stated  therein or necessary to make the
          statements  therein,  in light of the  circumstances  under which they
          were made, not misleading,

but in each case only to the extent that such untrue statement or alleged untrue
statement  or omission  or alleged  omission  was made in  reliance  upon and in
conformity with written information  furnished to the FW Parties by or on behalf
of such Holder (or its related Indemnified Holder) specifically for use therein,
and shall  reimburse  the FW Parties and any such  officer,  director,  manager,
employee  or  controlling  person  promptly  upon  demand for any legal or other
expenses  reasonably  incurred by the FW Parties or any such officer,  director,
manager,  employee or controlling  person in connection  with  investigating  or
defending or preparing to defend against

                                       14

<PAGE>

any such loss, claim, damage, liability or action as such expenses are incurred.
The  foregoing  indemnity  agreement is in addition to any  liability  which any
Holder may  otherwise  have to the FW Parties  and any such  officer,  director,
manager, employee or controlling person.

          (c) Promptly after receipt by an indemnified  party under this Section
6 of notice of any claim or the  commencement  of any  action,  the  indemnified
party  shall,  if a  claim  in  respect  thereof  is  to  be  made  against  the
indemnifying  party  under this  Section 6,  notify  the  indemnifying  party in
writing of the claim or the commencement of that action; provided, however, that
the  failure  to notify the  indemnifying  party  shall not  relieve it from any
liability  which it may have  under  this  Section 6 except to the extent it has
been  materially  prejudiced by such failure;  and provided,  further,  that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified  party  otherwise than under this Section 6.
If any such claim or action shall be brought against an indemnified  party,  and
it shall notify the indemnifying party thereof,  the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes,  jointly with
any other similarly notified  indemnifying  party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice from
the  indemnifying  party to the indemnified  party of its election to assume the
defense of such claim or action,  the indemnifying  party shall not be liable to
the  indemnified  party  under  this  Section 6 for any legal or other  expenses
subsequently  incurred by the  indemnified  party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that if
a Majority of Holders shall have  reasonably  concluded that there may be one or
more legal defenses available to them and their respective  officers,  employees
and controlling persons that are different from or additional to those available
to the FW  Parties  and  their  officers,  directors,  managers,  employees  and
controlling  persons,  the  reasonable  fees and  expenses of a single  separate
counsel shall be paid by the FW Parties. No indemnifying party shall:

               (i) without the prior written consent of the indemnified  parties
          (which consent shall not be  unreasonably  withheld or delayed) settle
          or  compromise or consent to the entry of any judgment with respect to
          any pending or threatened claim, action, suit or proceeding in respect
          of which  indemnification  or  contribution  may be  sought  hereunder
          (whether  or not the  indemnified  parties  are  actual  or  potential
          parties to such claim or action) unless such settlement, compromise or
          consent  includes an unconditional  release of each indemnified  party
          from  all  liability  arising  out of  such  claim,  action,  suit  or
          proceeding,  or

               (ii) be liable for any  settlement  of any such  action  effected
          without its written  consent (which consent shall not be  unreasonably
          withheld or delayed),  but if settled  with its written  consent or if
          there be a final  judgment for the  plaintiff in any such action,  the
          indemnifying   party  agrees  to  indemnify   and  hold  harmless  any
          indemnified  party from and against any loss or liability by reason of
          such settlement or judgment.

          (d) If the  indemnification  provided  for in this Section 6 shall for
any reason be unavailable or insufficient to hold harmless an indemnified  party
under  Section 6(a) or 6(b) in respect of any loss,  claim,  damage or liability
(or action in respect  thereof)  referred to therein,  each  indemnifying  party
shall, in lieu of indemnifying such indemnified party,  contribute to the

                                       15

<PAGE>

amount  paid or  payable  by such  indemnified  party as a result of such  loss,
claim, damage or liability (or action in respect thereof):

               (i) in such  proportion as is appropriate to reflect the relative
          benefits  received by the FW Parties from the offering and sale of the
          Transfer  Restricted  Securities  on the one hand  and a  Holder  with
          respect  to  the  sale  by  such  Holder  of the  Transfer  Restricted
          Securities on the other, or

               (ii)  if the  allocation  provided  by  clause  (6)(d)(i)  is not
          permitted by applicable  law, in such  proportion as is appropriate to
          reflect not only the relative  benefits  referred to in clause 6(d)(i)
          but also the relative  fault of the FW Parties on the one hand and the
          Holder on the other in connection  with the statements or omissions or
          alleged  statements or alleged  omissions  that resulted in such loss,
          claim, damage or liability (or action in respect thereof),  as well as
          any other relevant equitable considerations.

The relative benefits received by the FW Parties on the one hand and a Holder on
the other with  respect to such  offering and such sale shall be deemed to be in
the same  proportion  as the total net  proceeds  from the offering of the Notes
purchased under the Purchase  Agreement (before deducting  expenses) received by
the FW Parties,  on the one hand,  bear to the total  proceeds  received by such
Holder  with  respect  to its  sale  or  proposed  sale of  Transfer  Restricted
Securities on the other.  The relative  fault of the parties shall be determined
by  reference  to whether the untrue or alleged  untrue  statement of a material
fact or the  omission or alleged  omission to state a material  fact  relates to
information  supplied  by the FW Parties  on the one hand or the  Holders on the
other,  the  intent of the  parties  and  their  relative  knowledge,  access to
information  and  opportunity  to correct or prevent such statement or omission.
Each of the FW  Parties  and each  Holder  agree  that it would  not be just and
equitable  if the amount of  contribution  pursuant  to this  Section  6(d) were
determined by pro rata allocation or by any other method of allocation that does
not take into  account  the  equitable  considerations  referred to in the first
sentence of this  paragraph  (d).  The amount paid or payable by an  indemnified
party as a result of the loss, claim, damage or liability,  or action in respect
thereof,  referred to above in this  Section 6 shall be deemed to  include,  for
purposes of this Section 6, any legal or other expenses  reasonably  incurred by
such  indemnified  party  in  connection  with  investigating  or  defending  or
preparing to defend any such action or claim.  Notwithstanding the provisions of
this Section 6, no Holder shall be required to  contribute  any amount in excess
of the  amount  by  which  the  total  price at which  the  Transfer  Restricted
Securities  purchased by it were resold  exceeds the amount of any damages which
such  Holder  has  otherwise  been  required  to pay by reason of any  untrue or
alleged untrue  statement or omission or alleged  omission.  No person guilty of
fraudulent  misrepresentation  (within  the  meaning  of  Section  11(f)  of the
Securities  Act) shall be entitled to  contribution  from any person who was not
guilty  of  such  fraudulent  misrepresentation.  The  Holders'  obligations  to
contribute as provided in this Section 6(d) are several and not joint.

          7. Rule 144A.  In the event  neither  FW Ltd.  or FW LLC is subject to
Section 13 or 15(d) of the Exchange  Act, each of them hereby  covenants  agrees
with each  Holder,  for so long as any  Transfer  Restricted  Securities  remain
outstanding,  to make  available to any Holder or  beneficial  owner of Transfer
Restricted  Securities in connection  with any sale thereof and any

                                       16

<PAGE>

prospective purchaser of such Transfer Restricted Securities from such Holder or
beneficial  owner,  the  information  required  by  Rule  144A(d)(4)  under  the
Securities Act in order to permit resales of such Transfer Restricted Securities
pursuant to Rule 144A.

          8.  Participation  in  Underwritten   Registrations.   No  Holder  may
participate in any  Underwritten  Registration  hereunder unless at least 20% of
the Holders of the Transfer Restricted Securities outstanding at the time of the
Underwritten Registration participate in such Underwritten Registration and such
Holder:

               (i) agrees to sell such Holder's Transfer  Restricted  Securities
          on the basis provided in any underwriting arrangements approved by the
          Persons entitled hereunder to approve such arrangements; and

               (ii) completes and executes all reasonable questionnaires, powers
          of attorney, indemnities, underwriting agreements, lock-up letters and
          other  documents   required  under  the  terms  of  such  underwriting
          arrangements.

          9.  Selection  of  Underwriters.  The Holders of  Transfer  Restricted
Securities covered by the Shelf  Registration  Statement who desire to do so may
sell such Transfer  Restricted  Securities in an Underwritten  Offering.  In any
such  Underwritten  Offering,  the investment  banker or investment  bankers and
manager or managers  that will  administer  the  offering  will be selected by a
Majority of Holders whose  Transfer  Restricted  Securities are included in such
offering;  provided,  however, that such investment bankers and managers must be
reasonably satisfactory to the FW Parties.

          10. Miscellaneous.

          (a) Remedies. The FW Parties acknowledge and agree that any failure by
the FW  Parties  to comply  with their  obligations  under  Section 2 hereof may
result in  material  irreparable  injury to the  Holders  for which  there is no
adequate remedy at law, that it will not be possible to measure damages for such
injuries  precisely and that,  in the event of any such failure,  any Holder may
obtain such relief as may be  required to  specifically  enforce the FW Parties'
obligations under Section 2 hereof.

          (b)  Adjustments  Affecting  Transfer  Restricted  Securities.  The FW
Parties shall not,  directly or indirectly,  take any action with respect to the
Transfer  Restricted  Securities  as a class  that  would  adversely  affect the
ability of the  Holders  of  Transfer  Restricted  Securities  to  include  such
Transfer  Restricted  Securities in a registration  undertaken  pursuant to this
Agreement.

          (c) No Inconsistent Agreements.  The FW Parties shall not, on or after
the date of this  Agreement,  enter  into any  agreement  with  respect to their
securities that is  inconsistent  with the rights granted to the Holders in this
Agreement or otherwise conflicts with the provisions hereof. In addition, the FW
Parties shall not grant to any of their security holders (other than the holders
of Transfer Restricted  Securities in such capacity) the right to include any of
their  securities  in the  Shelf  Registration  Statement  provided  for in this
Agreement other than the

                                       17

<PAGE>

Transfer Restricted  Securities.  Except as described in the Offering Memorandum
dated May 24, 2001 relating to the Notes and in the Purchase Agreement,  none of
the FW Parties have previously entered into any agreement (which has not expired
or been  terminated)  granting  any  registration  rights with  respect to their
securities to any Person, which rights conflict with the provisions hereof.

          (d)  Amendments  and  Waivers.  This  Agreement  may  not be  amended,
modified or  supplemented,  and waivers or  consents to or  departures  from the
provisions  hereof may not be given,  unless the FW Parties  have  obtained  the
written consent of a Majority of Holders.

          (e)  Notices.  All notices and other  communications  provided  for or
permitted hereunder shall be made in writing by hand-delivery,  first-class mail
(registered or certified,  return receipt requested),  telex, telecopier, or air
courier guaranteeing overnight delivery:

               (i) if to a Holder,  at the  address  set forth on the records of
          the  registrar  under the  Indenture or the  transfer  agent of Common
          Shares, as the case may be; and

               (ii) if to FW Ltd. or FW LLC:

                    1 Perryville Corporate Park
                    Clinton, New Jersey 08809-4000
                    Attn: Thomas R. O'Brien, Esq.
                    Fax: (908) 730-5300

                    with a copy to:

                    White & Case LLP
                    1155 Avenue of the Americas
                    New York, New York 10036-2787
                    Attention: Timothy Goodell, Esq.
                    Fax: 212-354-8113

          All such notices and communications  shall be deemed to have been duly
given at: the time  delivered by hand,  if personally  delivered;  five Business
Days after  being  deposited  in the mail,  postage  prepaid,  if  mailed;  when
answered back, if telexed; when receipt acknowledged,  if telecopied; and on the
next Business Day, if timely delivered to an air courier guaranteeing  overnight
delivery.

          (f) Successors and Assigns.  This Agreement shall inure to the benefit
of and be  binding  upon the  successors  and  assigns  of each of the  parties,
including  without  limitation  and without the need for an express  assignment,
subsequent Holders of Transfer Restricted  Securities;  provided,  however, that
(i) this  Agreement  shall  not inure to the  benefit  of or be  binding  upon a
successor  or assign of a Holder  unless and to the  extent  such  successor  or
assign acquired Transfer Restricted Securities from such Holder and (ii) nothing
contained  herein  shall be deemed to permit any  assignment,  transfer or other
disposition of Transfer  Restricted  Securities in violation of the terms of the
Purchase  Agreement  or the  Indenture.  If any  transferee  of any

                                       18

<PAGE>

Holder shall acquire Transfer Restricted  Securities,  in any manner, whether by
operation of law or otherwise, such Transfer Restricted Securities shall be held
subject to all of the terms of this  Agreement,  and by taking and holding  such
Transfer Restricted  Securities such person shall be conclusively deemed to have
agreed to be bound by and to  perform  all of the terms and  provisions  of this
Agreement.

          (g)  Counterparts.  This  Agreement  may be  executed in any number of
counterparts and by the parties hereto in separate  counterparts,  each of which
when so  executed  shall be  deemed  to be an  original  and all of which  taken
together shall constitute one and the same agreement.

          (h) Securities  Held by the FW Parties or Their  Affiliates.  Whenever
the  consent or  approval  of  Holders of a  specified  percentage  of  Transfer
Restricted Securities is required hereunder, Transfer Restricted Securities held
by the FW  Parties  or their  Affiliates  shall not be  counted  in  determining
whether  such  consent or  approval  was given by the  Holders of such  required
percentage.

          (i) Headings.  The headings in this  Agreement are for  convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

          (j) Governing Law. This Agreement  shall be governed by, and construed
in accordance with, the laws of the State of New York.

          (k)  Severability.  If any  one or more  of the  provisions  contained
herein, or the application thereof in any circumstance, is held invalid, illegal
or  unenforceable,  the  validity,  legality  and  enforceability  of  any  such
provision  in every other  respect  and of the  remaining  provisions  contained
herein shall not be affected or impaired thereby.

          (l) Entire  Agreement.  This Agreement is intended by the parties as a
final  expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the  subject  matter  contained  herein.  There are no  restrictions,  promises,
warranties  or  undertakings,  other than those set forth or referred to herein,
with respect to the  registration  rights granted by the FW Parties with respect
to the Transfer  Restricted  Securities.  This  Agreement  supersedes  all prior
agreements and  understandings  between the parties with respect to such subject
matter.

          (m) Submission to  Jurisdiction.  FW Ltd.  agrees that any legal suit,
action or proceeding against it arising out of or based upon this Agreement, may
be instituted in any United States Federal or state court sitting in the Borough
of Manhattan, The City of New York, and waives any objection which it may now or
hereafter have to the laying of venue of any such proceeding, and submits to the
non-exclusive   jurisdiction  of  such  courts  in  any  such  suit,  action  or
proceeding. FW Ltd. hereby agrees that service in any such action arising out of
or based on this  Agreement  which may be instituted in any United States or New
York State court in the Borough of  Manhattan,  the City of New York,  New York,
may be served on it at the following  address:  Foster Wheeler Ltd.,  Perryville
Corporate  Park,  Service  Road  East,  173,  Clinton,  New  Jersey  08809-4000,
Attention:  General Counsel,  and expressly  consents to the jurisdiction of any
such

                                       19

<PAGE>

court, but only in respect of any such action, and waives any other requirements
of or objections to personal  jurisdiction with respect thereto. With respect to
any such  action in any United  States or New York State court in the Borough of
Manhattan,  The City of New York, New York, service of process on FW Ltd. at the
address set forth above and written  notice of such service to FW Ltd.  shall be
deemed, in every respect, effective service of process upon FW Ltd.

                                       20

<PAGE>

          IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.

                                     Foster Wheeler Ltd.

                                     By /s/ Lisa Fries Gardner
                                        ----------------------------------------
                                        Name:  Lisa Fries Gardner
                                        Title: Vice President and Secretary

                                     Foster Wheeler LLC

                                     By /s/ Robert Iseman
                                        ----------------------------------------
                                        Name:  Robert Iseman
                                        Title: Vice President

                                     Lehman Brothers Inc.
                                     Banc of America Securities LLC
                                     First Union Securities, Inc.

                                     By: Lehman Brothers Inc.

                                     By /s/  Steve Hellman
                                        ----------------------------------------
                                        Name:  Steve Hellman
                                        Title: Authorized Representative

                                       21

<PAGE>

                                                                     Exhibit A

             Form of Selling Securityholder Notice and Questionnaire

                                      A-1

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