Document:

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                                                                     EXHIBIT 4.3

THIS INDENTURE dated as of October 11, 2001

BETWEEN:

(1)  AEGON Funding Corp., a corporation duly organized and existing under the
     laws of the State of Delaware ("AEGON Funding");

(2)  AEGON Funding Corp. II, a corporation duly organized and existing under the
     laws of the State of Delaware ("AEGON Funding II");

(3)  AEGON N.V., a corporation duly organized and existing under the laws of The
     Netherlands, having its principal office at Mariahoeveplein 50, 2591 TV,
     The Hague, The Netherlands ("AEGON N.V."); and

(4)  CITIBANK, N.A., a national banking association duly organized and existing
     under the laws of the United States of America, as Trustee (the "Trustee").

RECITALS

Each of AEGON N.V., AEGON Funding and AEGON Funding II has duly authorized the
execution and delivery of this Indenture to provide for the issuance from time
to time of its unsecured debentures, notes or other evidences of indebtedness
(herein called the "Securities"), to be issued in one or more series as in this
Indenture provided.

AEGON N.V. indirectly owns beneficially and of record 100% of the share capital
of AEGON Funding and AEGON Funding II; AEGON N.V. has duly authorized the
execution and delivery of this Indenture to provide for the Parent Guarantee (as
defined herein) with respect to the Securities of AEGON Funding and AEGON
Funding II set forth in this Indenture.  For purposes of this Indenture, the
"Company" means either AEGON N.V., AEGON Funding or AEGON Funding II, as the
case may be, in its capacity as issuer of the Securities. For the purposes of
this Indenture, "Parent Guarantor" means AEGON N.V. in its capacity as issuer of
the Parent Guarantee.

All things necessary to make this Indenture a valid and legally binding
agreement of AEGON N.V., AEGON Funding and AEGON Funding II, in accordance with
its terms, have been done.

NOW, THEREFORE:

The parties hereto hereby agree as follows, for the equal and proportionate
benefit of all Holders of the Securities or of series thereof:

            DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

101. Definitions

     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 other terms used herein which are defined in the Trust Indenture
          Act, either
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          directly or by reference therein, have the meanings assigned to them
          therein;

     (3)  all accounting terms not otherwise defined herein have the meanings
          assigned to them in accordance with generally accepted accounting
          principles, and, except as otherwise herein expressly provided, the
          term "generally accepted accounting principles" with respect to any
          computation required or permitted hereunder shall mean such accounting
          principles as are generally accepted as consistently applied by AEGON
          N.V. at the date of this instrument;

     (4)  unless the context otherwise requires, any reference to an "Article"
          or a "Section" refers to an Article or a Section, as the case may be,
          of this Indenture; and

     (5)  the word "including" means "including, without limitation"; and

     (6)  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.

     "Act", when used with respect to any Holder, has the meaning specified in
     Section 104.

     "Additional Amounts" has the meaning specified in Section 1006.

     "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.

     "Authenticating Agent" means any Person authorized by the Trustee pursuant
     to Section 614 to act on behalf of the Trustee to authenticate Securities
     of one or more series.

     "Average Price Per Share" means (a) for New York Shares for any day the
     average of the opening and closing prices per Common Share (i) on the New
     York Stock Exchange as reported on the composite tape, or, if the New York
     Shares are not listed or admitted to trading on the New York Stock
     Exchange, on the principal (as determined by AEGON N.V.'s Board of
     Directors) U.S. national securities exchange on which the New York Shares
     are listed or admitted to trading, or (ii) if not listed or admitted to
     trading on any national securities exchange on the National Association of
     Securities Dealers Automated Quotations National Market System, or, if the
     New York Shares are not listed or admitted to trading on any national
     securities exchange or quoted on such National Market System, the average
     of the opening and closing bid and asked prices in the over-the-counter
     market as furnished by any New York Stock Exchange member firm selected
     from time to time by AEGON N.V. for that purpose, and (b) for Ordinary
     Shares for any day the average of the first and last sale prices per Common
     Share on Euronext Amsterdam or, in the event that the Ordinary Shares are
     quoted on Euronext Amsterdam on one or more lines, the average of the first
     and last reported sale prices on all such lines, in each case as reported
     in the Officiele Prijscourant for that date, or in the absence of such
     price, as certified by ABN AMRO Bank N.V. or such other reputable
     independent bank in Amsterdam as selected by AEGON N.V. or (c) for either
     New York Shares or Ordinary Shares such other average as may be specified
     with respect to a given series of Securities pursuant to Section 301.

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     "Board of Directors" means either the board of directors of AEGON Funding
     or AEGON Funding II or the Executive Board of AEGON N.V., as applicable, or
     any duly authorized committee thereof or nominated thereby.

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

     "Business Day", when used with respect to any Place of Payment, means each
     Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
     banking institutions in that Place of Payment are authorized or obligated
     by law or executive order to close.

     "Cash Dividend" has the meaning specified in Section 1504.

     "Cash Option" means the option of AEGON N.V., upon notice of conversion, to
     pay Holders the Cash Option Amount in lieu of delivering Common Shares.

     "Cash Option Amount" means an amount in U.S. dollars, or any other currency
     or currencies as specified pursuant to Section 301, equal to the Average
     Price per Share on, unless otherwise specified pursuant to Section 301, the
     five Stock Exchange Trading Days up to and including the Conversion Date
     multiplied by the number of Common Shares the Holder would have been
     entitled to upon conversion had AEGON N.V. not exercised its Cash Option.

     "Closing Price" on any day means the official closing price per Common
     Share quoted on the  New York Stock Exchange for such day.

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

     "Common Shares" means the common shares, par value 0.12 euros per common
     share, of AEGON N.V., as designated on the date hereof, and all shares
     resulting from any reclassification of such common shares.

     "Company" means each Person named as the "Company" in the recitals to this
     instrument 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 Request" or "Company Order" means a written request or order
     signed in the name of the Company by its Chairman of the Board of
     Directors, its Vice Chairman of the Board of Directors, its President or a
     Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary
     or an Assistant Secretary, and delivered to the Trustee.

     "Conversion Agent" has the meaning specified in Section 1002.

     "Conversion Date" has the meaning specified in Section 1503.

     "Conversion Price" means the price at which the Convertible Securities
     shall be convertible into Common Shares, such price to be established
     pursuant to Section 301 and to be subject to adjustment as provided in
     Section 1504.

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     "Conversion Shares" has the meaning specified in Article Fifteen.

     "Convertible Securities" means any series of Securities of AEGON N.V.
     designated as convertible or exchangeable pursuant to Section 301.

     "Corporate Trust Office" means the principal office of the Trustee in New
     York, NY at which at any particular time its corporate trust business shall
     be administered.

     "corporation" means a corporation, association, company, joint-stock
     company or business trust.

     "Covenant Defeasance" has the meaning specified in Section 1303.

     "Defaulted Interest" has the meaning specified in Section 307.

     "Defeasance" has the meaning specified in Section 1302.

     "Depositary" means, with respect to Securities of any series issuable in
     whole or in part in the form of one or more Global Securities, a clearing
     agency registered under the Exchange Act that is designated to act as
     Depositary for such Securities as contemplated by Section 301.

     "Effective Date" means (i) in the case of a dividend or distribution on
     Common Shares in the form of Common Shares which dividend or distribution
     permits the recipient to elect between cash and Common Shares, the date on
     which the Common Shares are issued in connection with such dividend or
     distribution, (ii)  the date on which Common Shares will trade on the New
     York Stock Exchange excluding the relevant right or entitlement relating to
     an event giving rise to an adjustment of the Conversion Price, (iii) if (i)
     and (ii) are not applicable, the date on which the relevant event is
     announced by the Company or, if no such announcement is made, the date the
     relevant issue is made.

     "Event of Default" has the meaning specified in Section 501.

     "Exchange Act" means the Securities Exchange Act of 1934 and any statute
     successor thereto, in each case as amended from time to time.

     "Expiration Date" has the meaning specified in Section 104.

     "Global Security" means a Security that evidences all or part of the
     Securities of any series and bears the legend set forth in Section 204 (or
     such legend as may be specified as contemplated by Section 301 for such
     Securities).

     "Holder" means a Person in whose name a Security is registered in the
     Security Register.

     "Indebtedness" means all indebtedness for money borrowed that is created,
     assumed, incurred or guaranteed in any manner or for which the Company is
     otherwise responsible or liable.

     "Indenture" means this instrument as originally executed and 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, including, for all purposes of this instrument and any such
     supplemental indenture, the provisions of the Trust Indenture Act that are
     deemed to be a part of and govern this instrument and any such supplemental
     indenture, respectively.

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     The term "Indenture" shall also include the terms of particular series of
     Securities established as contemplated by Section 301.

     "interest", when used with respect to an Original Issue Discount Security
     which by its terms bears interest only after Maturity, means interest
     payable after Maturity.

     "Interest Payment Date", when used with respect to any Security, means the
     Stated Maturity of an installment of interest on such Security.

     "Investment Company Act" means the Investment Company Act of 1940 and any
     statute successor thereto, in each case as amended from time to time.

     "Market Price" on any day means the Average Price Per Share for the ten
     consecutive Stock Exchange Trading Days ending on the earlier of such day
     and the Stock Exchange Trading Day immediately preceding the Effective
     Date.

     "Maturity", when used with respect to any Security, means the date, if any,
     on which the principal of such Security or an installment of principal
     becomes due and payable as therein or herein provided, whether at the
     Stated Maturity or by declaration of acceleration, call for redemption or
     otherwise.

     "Notice of Default" means a written notice of the kind specified in Section
     501(4) or 501(5).

     "New York Shares" means Common Shares registered on AEGON N.V.'s share
     registry in New York.

     "Officers' Certificate" means a certificate signed by the Chairman of the
     Board of Directors, a Vice Chairman of the Board of Directors, the
     President or a Vice President, and by the Treasurer, an Assistant
     Treasurer, the Secretary or an Assistant Secretary, of the Company, and
     delivered to the Trustee.  One of the officers signing an Officers'
     Certificate given pursuant to Section 1004 shall be the principal
     executive, financial or accounting officer of the Company.

     "Opinion of Counsel" means a written opinion of counsel, who may be an
     employee for counsel for the Company.

     "Ordinary Shares" means Common Shares in bearer form or Common Shares
     registered on AEGON N.V.'s share registry in the Netherlands.

     "Original Issue Discount Security" means any Security which provides for an
     amount less than the principal amount thereof to be due and payable upon a
     declaration of acceleration of the Maturity thereof pursuant to Section
     502.

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

     (1)  Securities theretofore cancelled by the Trustee or delivered to the
          Trustee for cancellation;

     (2)  Securities for whose payment or redemption money in the necessary
          amount has been theretofore 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 that, if such

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          Securities are to be redeemed, notice of such redemption has been duly
          given pursuant to this Indenture or provision therefor satisfactory to
          the Trustee has been made;

     (3)  Securities as to which Defeasance has been effected pursuant to
          Section 1302; and

     (4)  Securities which have been paid pursuant to Section 306 or 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;

     provided, however, that in determining whether the Holders of the requisite
     principal amount of the Outstanding Securities have given, made or taken
     any request, demand, authorization, direction, notice, consent, waiver or
     other action hereunder as of any date, (A) the principal amount of an
     Original Issue Discount Security which shall be deemed to be Outstanding
     shall be the amount of the principal thereof which would be due and payable
     as of such date upon acceleration of the Maturity thereof to such date
     pursuant to Section 502, (B) if, as of such date, the principal amount
     payable at the Stated Maturity of a Security is not determinable, the
     principal amount of such Security which shall be deemed to be Outstanding
     shall be the amount as specified or determined as contemplated by Section
     301, (C) the principal amount of a Security denominated in one or more
     foreign currencies or currency units which shall be deemed to be
     Outstanding shall be the U.S. dollar equivalent, determined as of such date
     in the manner provided as contemplated by Section 301, of the principal
     amount of such Security (or, in the case of a Security described in Clause
     (A) or (B) above, of the amount determined as provided in such Clause), and
     (D) Securities owned by the Company or any other obligor upon the
     Securities or any Affiliate of the Company or of such other obligor shall
     be disregarded and deemed not to be Outstanding, except that, in
     determining whether the Trustee shall be protected in relying upon any such
     request, demand, authorization, direction, notice, consent, waiver or other
     action, only Securities which a Responsible Officer of the Trustee actually
     knows to be so owned shall be so disregarded. Securities so owned which
     have been pledged in good faith may be regarded as Outstanding if the
     pledgee establishes to the satisfaction of the Trustee the pledgee's right
     so to act with respect to such Securities and that the pledgee is not the
     Company or any other obligor upon the Securities or any Affiliate of the
     Company or of such other obligor.

     "Parent Guarantee" means the guarantee of the Parent Guarantor endorsed on
     a Security issued by AEGON Funding or AEGON Funding II and authenticated
     and delivered pursuant to this Indenture which guarantee shall be made as
     and to the extent provided in Article Sixteen.

     "Paying Agent" means any Person authorized by the Company to pay the
     principal of or any premium or interest on any Securities on behalf of the
     Company.

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

     "Place of Payment", when used with respect to the Securities of any series,
     means the place or places where the principal of and any premium and
     interest on the Securities of that series are payable as specified as
     contemplated by Section 301.

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     "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 306 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.

     "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 it is to be redeemed pursuant to this Indenture.

     "Regular Record Date" for the interest payable on any Interest Payment Date
     on the Securities of any series means the date specified for that purpose
     as contemplated by Section 301.

     "Responsible Officer", when used with respect to the Trustee, means any
     vice president, any trust officer or any other officer of the Trustee
     customarily performing functions similar to those performed by any of the
     above designated officers and also means, with respect to a particular
     corporate trust matter, any other officer to whom such matter is referred
     because of his knowledge of and familiarity with the particular subject and
     who shall have direct responsibility for the administration of this
     Indenture.

     "Securities" has the meaning stated in the recital to this Indenture and
     more particularly means any Securities authenticated and delivered under
     this Indenture.

     "Securities Act" means the Securities Act of 1933 and any statute successor
     thereto, in each case as amended from time to time.

     "Security Register" and "Security Registrar" have the respective meanings
     specified in Section 305.

     "Senior Debt" means the principal of (and premium, if any) and interest on
     any Indebtedness of the Company currently outstanding or to be issued
     hereafter unless such Indebtedness by the terms of the instrument by which
     it is created or evidenced, is Subordinated Indebtedness.

     "Special Record Date" for the payment of any Defaulted Interest means a
     date fixed by the Trustee pursuant to Section 307.

     "Stated Maturity", when used with respect to any Security or any
     installment of principal thereof or interest thereon, means the date
     specified in such Security as the fixed date on which the principal of such
     Security or such installment of principal or interest is due and payable.

     "Stock Exchange Trading Day" means a day that the New York Stock Exchange
     and the Euronext Amsterdam exchange are open for trading.

     "Subordinated Indebtedness" means any Indebtedness of the Company the right
     to payment of which is, or is expressed to be, or is required by any
     present or future agreement of the Company to be, subordinated to other
     indebtedness in the event of bankruptcy, dissolution, winding-up or
     liquidation of the Company.

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     "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, "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.

     "Total Current Dividend" has the meaning specified in Section 1504.

     "Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
     the date as of which this instrument was executed; provided, however, that
     in the event the Trust Indenture Act of 1939 is amended after such date,
     "Trust Indenture Act" means, to the extent required by any such amendment,
     the Trust Indenture Act of 1939 as so amended.

     "Trustee" means the Person named as the "Trustee" in the first paragraph of
     this instrument until a successor Trustee shall have become such pursuant
     to the applicable provisions of this Indenture, and thereafter "Trustee"
     shall mean or include each Person who is then a Trustee hereunder, and if
     at any time there is more than one such Person, "Trustee" as used with
     respect to the Securities of any series shall mean the Trustee with respect
     to Securities of that series.

     "U.S. Government Obligation" has the meaning specified in Section 1304.

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

102. Compliance Certificates and Opinions

     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 such certificates and opinions as may be required under the
     Trust Indenture Act. Each such certificate or opinion shall be given in the
     form of an Officers' Certificate, if to be given by an officer of the
     Company, or an Opinion of Counsel, if to be given by counsel, and shall
     comply with the requirements of the Trust Indenture Act and any other
     requirements set forth in this Indenture.

     Every certificate or opinion with respect to compliance with a condition or
     covenant provided for in this Indenture (except for certificates provided
     for in Section 1004) shall include:

     (1)  a statement that each individual signing such certificate or opinion
          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.

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103. Form of Documents Delivered to Trustee.

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

104. Acts of Holders; Record Dates

     Any request, demand, authorization, direction, notice, consent, waiver or
     other action provided or permitted by this Indenture to be given, made or
     taken by Holders may be embodied in and evidenced by one or more
     instruments of substantially similar tenor signed by such Holders in person
     or by an agent duly appointed in writing; and, except as otherwise
     expressly provided herein, such action shall become effective when such
     instrument or instruments are delivered to the Trustee and, where it is
     hereby expressly required, to the Company. Such instrument or instruments
     (and the action embodied therein and evidenced thereby) are herein
     sometimes referred to as the "Act" of the Holders signing such instrument
     or instruments. Proof of execution of any such instrument or of a writing
     appointing any such agent shall be sufficient for any purpose of this
     Indenture and (subject to Section 601) conclusive in favor of the Trustee
     and the Company, if made in the manner provided in this Section.

     The fact and date of the execution by any Person of any such instrument or
     writing may be proved by the affidavit of a witness of such execution or by
     a certificate of a notary public or other officer authorized by law to take
     acknowledgments of deeds, certifying that the individual signing such
     instrument or writing acknowledged to him the execution thereof. Where such
     execution is by a signer acting in a capacity other than his individual
     capacity, such certificate or affidavit shall also constitute sufficient
     proof of his authority. The fact and date of the execution of any such
     instrument or writing, or the authority of the Person executing the same,
     may also be proved in any other manner which the Trustee deems sufficient.

     The ownership of registered Securities shall be proved by the Security
     Register, and the ownership of unregistered Securities, if any, shall be
     determined in the manner set forth in the Board Resolution or supplemental
     indenture relating to any series of unregistered Securities.

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     Any request, demand, authorization, direction, notice, consent, waiver or
     other Act of the Holder 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.

     The Company may set any day as a record date for the purpose of determining
     the Holders of Outstanding Securities of any series entitled to give, make
     or take any request, demand, authorization, direction, notice, consent,
     waiver or other action provided or permitted by this Indenture to be given,
     made or taken by Holders of Securities of such series, provided that the
     Company may not set a record date for, and the provisions of this paragraph
     shall not apply with respect to, the giving or making of any notice,
     declaration, request or direction referred to in the next paragraph.  If
     any record date is set pursuant to this paragraph, the Holders of
     Outstanding Securities of the relevant series on such record date, and no
     other Holders, shall be entitled to take the relevant action, whether or
     not such Holders remain Holders after such record date; provided that no
     such action shall be effective hereunder unless taken on or prior to the
     applicable Expiration Date by Holders of the requisite principal amount of
     Outstanding Securities of such series on such record date. Nothing in this
     paragraph shall be construed to prevent the Company from setting a new
     record date for any action for which a record date has previously been set
     pursuant to this paragraph (whereupon the record date previously set shall
     automatically and with no action by any Person be cancelled and of no
     effect), and nothing in this paragraph shall be construed to render
     ineffective any action taken by Holders of the requisite principal amount
     of Outstanding Securities of the relevant series on the date such action is
     taken. Promptly after any record date is set pursuant to this paragraph,
     the Company shall cause notice of such record date, the proposed action and
     the applicable Expiration Date to be given to the Trustee in writing and to
     each Holder of Securities of the relevant series in the manner set forth in
     Section 106.

     The Trustee may set any day as a record date for the purpose of determining
     the Holders of Outstanding Securities of any series entitled to join in the
     giving or making of (i) any Notice of Default, (ii) any declaration of
     acceleration referred to in Section 502, (iii) any request to institute
     proceedings referred to in Section 507(2) or (iv) any direction referred to
     in Section 512, in each case with respect to Securities of such series. If
     any record date is set pursuant to this paragraph, the Holders of
     Outstanding Securities of such series on such record date, and no other
     Holders, shall be entitled to join in such notice, declaration, request or
     direction, whether or not such Holders remain Holders after such record
     date; provided that no such action shall be effective hereunder unless
     taken on or prior to the applicable Expiration Date by Holders of the
     requisite principal amount of Outstanding Securities of such series on such
     record date. Nothing in this paragraph shall be construed to prevent the
     Trustee from setting a new record date for any action for which a record
     date has previously been set pursuant to this paragraph (whereupon the
     record date previously set shall automatically and with no action by any
     Person be cancelled and of no effect), and nothing in this paragraph shall
     be construed to render ineffective any action taken by Holders of the
     requisite principal amount of Outstanding Securities of the relevant series
     on the date such action is taken. Promptly after any record date is set
     pursuant to this paragraph, the Trustee shall cause notice of such record
     date, the proposed action and the applicable Expiration Date to be given to
     the Company in writing and to each Holder of Securities of the relevant
     series in the manner set forth in Section 106.

     With respect to any record date set pursuant to this Section, the party
     hereto which sets such record dates may designate any day as the
     "Expiration Date" and from time to time may change the Expiration Date to
     any earlier or later day; provided that no such change shall be

                                      10
<PAGE>

     effective unless notice of the proposed new Expiration Date is given to the
     other party hereto in writing, and to each Holder of Securities of the
     relevant series in the manner set forth in Section 106, on or prior to the
     existing Expiration Date. If an Expiration Date is not designated with
     respect to any record date set pursuant to this Section, the party hereto
     which set such record date shall be deemed to have initially designated the
     180th day after such record date as the Expiration Date with respect
     thereto, subject to its right to change the Expiration Date as provided in
     this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
     later than the 180th day after the applicable record date.

     Without limiting the foregoing, a Holder entitled to take any action
     hereunder with regard to any particular Security may do so with regard to
     all or any part of the principal amount of such Security or by one or more
     duly appointed agents each of which may do so pursuant to such appointment
     with regard to all or any part of such principal amount.

105. Notices, Etc., to Trustee and Company

     Any request, demand, authorization, direction, notice, consent, waiver or
     Act of Holders or other document provided or permitted by this Indenture to
     be made upon, given or furnished to, or filed with:

     (1)  the Trustee by any Holder or by the Company or the Parent Guarantor
          shall be sufficient for every purpose hereunder if made, given,
          furnished or filed in writing (which may be via fax or electronic
          mail) to or with the Trustee at its Corporate Trust Office, Attention:
          Citibank Agency & Trust, or

     (2)  the Company or the Parent Guarantor by the Trustee or by any Holder
          shall be sufficient for every purpose hereunder (unless otherwise
          herein expressly provided) if in writing and mailed, first-class
          postage prepaid, to the Company or the Parent Guarantor, as the case
          may be, addressed to it at the address of its principal office or at
          any other address specified for that purpose previously furnished in
          writing to the Trustee by the Company or the Parent Guarantor, as the
          case may be, and not theretofore superceded.

106. Notice to Holders; Waiver

     Where this Indenture provides for notice to Holders of any event, such
     notice shall be sufficiently given (unless otherwise herein expressly
     provided) if in writing and mailed, first-class postage prepaid, to each
     Holder affected by such event, at his address as it appears in the Security
     Register, not later than the latest date (if any), and not earlier than the
     earliest date (if any), prescribed for the giving of such notice. In any
     case where notice to Holders is given by mail, neither the failure to mail
     such notice, nor any defect in any notice so mailed, to any particular
     Holder shall affect the sufficiency of such notice with respect to other
     Holders. Where this Indenture provides for notice in any manner, such
     notice may be waived in writing by the Person entitled to receive such
     notice, either before or after the event, and such waiver shall be the
     equivalent of such notice. Waivers of notice by Holders shall be filed with
     the Trustee, but such filing shall not be a condition precedent to the
     validity of any action taken in reliance upon such waiver.

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

                                       11
<PAGE>

107. Conflict with Trust Indenture Act

     If any provision hereof limits, qualifies or conflicts with a provision of
     the Trust Indenture Act which is required under such Act to be a part of
     and govern this Indenture, the latter provision shall control. If any
     provision of this Indenture modifies or excludes any provision of the Trust
     Indenture Act which may be so modified or excluded, the latter provision
     shall be deemed to apply to this Indenture as so modified or to be
     excluded, as the case may be.

108. 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.

109. Successors and Assigns

     All covenants and agreements in this Indenture by the Company, and, if
     applicable, the Parent Guarantor, shall bind its and their successors and
     assigns, whether so expressed or not.

110. Separability Clause

     In case any provision in this Indenture or in 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.

111. Benefits of Indenture

     Nothing 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, any benefit or any legal or equitable right,
     remedy or claim under this Indenture.

112. Governing Law.

     This Indenture and the Securities shall be governed by and construed in
     accordance with the law of the State of New York.

113. Legal Holidays.

     In any case where any Interest Payment Date, Redemption Date or Stated
     Maturity of any Security shall not be a Business Day at any Place of
     Payment, then (notwithstanding any other provision of this Indenture or of
     the Securities (other than a provision of any Security which specifically
     states that such provision shall apply in lieu of this Section)) payment of
     interest or principal (and premium, if any) need not be made at such Place
     of Payment on such date, but may be made on the next succeeding Business
     Day at such Place of Payment with the same force and effect (and without
     accrual or payment of additional interest) as if made on the Interest
     Payment Date or Redemption Date, or at the Stated Maturity.

114. Agent for Service; Submission to Jurisdiction; Waiver of Immunities.

     By the execution and delivery of this Indenture, the Parent Guarantor (i)
     acknowledges that it has, by separate written instrument, irrevocably
     designated and appointed the Company as its authorized agent upon which
     process may be served in any suit or proceeding arising out of or relating
     to the Securities, the Parent Guarantees or this Indenture that may be
     instituted in the Federal or State court in the Borough of Manhattan, The
     City of New York or brought under

                                       12
<PAGE>

     Federal or State securities laws or brought by the Trustee (whether in its
     individual capacity or in its capacity as a trustee hereunder), and
     acknowledges that the Company has accepted such designation, (ii) submits
     to the jurisdiction of any such court in any such suit or proceeding, and
     (iii) agrees that service of process upon the Company and written notice of
     said service to it (mailed or delivered to its Secretary at the address
     specified in the most recent address furnished in writing to the Trustee
     expressly for this purpose) shall be deemed in every respect effective
     service of process upon it in any such suit or proceeding.

     To the extent that the Parent Guarantor has or hereafter may acquire
     immunity from jurisdiction of any court or from any legal process (whether
     through service of notice, attachment prior to judgment, attachment in aid
     of execution, execution, or otherwise) with respect to itself or its
     property, the Parent Guarantor hereby waives such immunity in respect of
     its respective obligations under this Indenture, the Securities and the
     Parent Guarantees to the fullest extent permitted by law.

                                SECURITY FORMS

201. Forms Generally

     The Securities of each series, the Parent Guarantees, if applicable, to be
     endorsed thereon and the Trustee's certificates of authentication shall be
     in substantially the forms set forth in this Article or in one or more
     indentures supplemental hereto, or, in the case of the Securities, in such
     other form as shall be established by or pursuant to a Board Resolution, in
     each case with such appropriate insertions, omissions, substitutions and
     other variations as are required or permitted by this Indenture, and may
     have such letters, numbers or other marks of identification and such
     legends or endorsements placed thereon as may be required to comply with
     the rules of any securities exchange or Depositary therefor or as may,
     consistently herewith, be determined by the officers executing such
     Securities or Parent Guarantees, as evidenced by their execution thereof.
     If the form of Securities of any series is established by action taken
     pursuant to a Board Resolution, a copy of an appropriate record of such
     action shall be certified by the Secretary or an Assistant Secretary of the
     Company and delivered to the Trustee at or prior to the delivery of the
     Company Order contemplated by Section 303 for the authentication and
     delivery of such Securities.

     The definitive Securities and Parent Guarantees, if applicable, to be
     endorsed thereon shall be printed, lithographed or engraved on steel
     engraved borders or may be produced in any other manner, all as determined
     by the officers executing such Securities or Parent Guarantees, as
     evidenced by their execution of such Securities or Parent Guarantees, as
     the case may be.

     In the case of Convertible Securities of any series that are convertible at
     the option of Holders into Common Shares, the form of election to convert
     shall be substantially in the form set forth in Section 301, or in such
     other form as shall be established by or pursuant to a Resolution or in one
     of more indentures supplemental hereto, in each case with such appropriate
     insertions, omissions, substitutions and other variations as are required
     or permitted by this Indenture and may be imprinted or otherwise reproduced
     on the Convertible Securities of such series.

202. Form of Face of Security.

     [Insert any legend required by the Internal Revenue Code and the
     regulations thereunder.]

     ......................................

                                       13
<PAGE>

     ......................................

     CUSIP No. .........  [$] ........

     [.], a corporation duly organized and existing under the laws of [.]
     (herein called the "Company", which term includes any successor Person
     under the Indenture hereinafter referred to), for value received, hereby
     promises to pay to [.], or registered assigns, [if the Security is not
     perpetual, insert: the principal sum of [.] on [.]] [if the Security is to
     bear interest prior to Maturity, insert: and to pay interest thereon from
     [.] or from the most recent Interest Payment Date to which interest has
     been paid or duly provided for, [insert as applicable: annually, semi-
     annually or quarterly] on [insert appropriate interest payment dates: [.]
     and [.]] in each year, commencing [.], at the rate of [.]% per annum, until
     the principal hereof is paid or made available for payment. The interest so
     payable, and punctually paid or duly provided for, on any Interest Payment
     Date will, as provided in such Indenture, be paid to the Person in whose
     name this Security (or one or more Predecessor Securities) is registered at
     the close of business on the Regular Record Date for such interest, which
     shall be the [.] or [.] (whether or not a Business Day), as the case may
     be, next preceding such Interest Payment Date. Any such interest not so
     punctually paid or duly provided for will forthwith cease to be payable to
     the Holder on such Regular Record Date and may either be paid to the Person
     in whose name this Security (or one or more Predecessor Securities) is
     registered at the close of business on a Special Record Date for the
     payment of such Defaulted Interest to be fixed by the Trustee, notice
     whereof shall be given to Holders of Securities of this series not less
     than 10 days prior to such Special Record Date, or be paid at any time in
     any other lawful manner not inconsistent with the requirements of any
     securities exchange on which the Securities of this series may be listed,
     and upon such notice as may be required by such exchange, all as more fully
     provided in said Indenture.

     Payment of the principal of (and premium, if any) and interest, if any, on
     this Security will be made at the office or agency of the Company
     maintained for that purpose in [insert the places of payment] [.] in
     [insert the currency or currencies of payment] such coin or currency of the
     United States of America as at the time of payment is legal tender for
     payment of public and private debts [if applicable, insert: provided,
     however, that at the option of the Company payment of interest may be made
     by check mailed to the address of the Person entitled thereto as such
     address shall appear in the Security Register].

     All payments in respect of the Security, including without limitation,
     payments of principal, [if the security is to bear interest prior to
     maturity insert: interest, if any,] and  premium, if any, shall be made by
     the Company, or by the Parent Guarantor, as the case may be, without
     withholding or deduction for or on account of any present or future taxes,
     duties, levies, or other governmental charges of whatever nature in effect
     on the date of the Indenture or imposed or established in the future by or
     on behalf of The Netherlands or the United States or any authority thereof
     (respectively, a "Netherlands Tax"  and "United States Tax").  In the event
     that any such Netherlands Tax or United States Tax is so imposed or
     established, the Company or the Parent Guarantor shall pay such additional
     amounts ("Additional Amounts") as may be necessary in order that the net
     amounts receivable by each Holder after any payment, withholding or
     deduction in respect of such Netherlands Tax or United States Tax shall
     equal the respective amounts of principal [if the Security is to bear
     interest prior to maturity insert: , interest and] premium, if any, which
     would have been receivable in respect of the Security in the absence of
     such payment, withholding or deduction; provided, however, that (a) the
     amounts with respect to the Netherlands Tax shall be payable only to
     Holders that are not residents in The Netherlands for purposes of its tax;
     and (b) amount with respect to United States Tax shall be payable only to a
     Holder that is, for United States tax purposes, a nonresident alien
     individual, a foreign corporation, or an estate or trust not subject to tax
     on a

                                       14
<PAGE>

     net income basis with respect to income on the Securities (a "United States
     Alien"), and provided further, that the issuer or guarantor shall not be
     required to make any payment of Additional Amounts for or account of:

     (1)  any tax, assessment or other governmental charge which would not have
          been imposed but for the existence of any present or former connection
          between such Holder (or between a fiduciary, settlor, beneficiary,
          member or shareholder of, or possessor of a power over such Holder, if
          such Holder is an estate, trust, partnership or corporation) and The
          Netherlands or the United States (in the case of a Netherlands Tax or
          a United States Tax, respectively), or any political subdivision or
          territory or possession thereof or therein or area subject to its
          jurisdiction, including, without limitation, such Holder (or such
          fiduciary, settlor, beneficiary, member, shareholder or possessor)
          being or having been a citizen or resident thereof or treated as a
          resident thereof or being or having been present or engaged in a trade
          or business therein or having or having had a permanent establishment
          therein;

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

     (3)  any tax, assessment or other governmental charge which is payable
          other than by withholding from payments of (or in respect of)
          principal of, premium, if any, or any interest on, the Securities;

     (4)  with respect to any United States Tax, any such tax imposed by reason
          of the Holder's past or present status as a personal holding company,
          foreign personal holding company or foreign private foundation or
          similar tax-exempt organization with respect to the United States or
          as a corporation which accumulates earnings to avoid United States
          Federal income tax;

     (5)  with respect to any United States Tax, any such Tax imposed by reason
          of such Holder's past or present status as (i) the actual or
          constructive owner of 10% or more of the total combined voting power
          of all classes of stock of AEGON Funding or AEGON Funding II or (ii) a
          controlled foreign corporation that is related to AEGON Funding or
          AEGON Funding II through stock ownership;

     (6)  any tax, assessment or other governmental charge required to be
          withheld by any Paying Agent from any payment of principal of,
          premium, if any, or any interest on, any Security, if such payment can
          be made without such withholding by any other paying agent;

     (7)  any tax, assessment or other governmental charge which would not have
          been imposed or withheld if such Holder had made a declaration of
          nonresidence or other similar claim for exemption or presented any
          applicable form of certificate, upon the making or presentation of
          which that Holder would either have been able to avoid such tax,
          assessment or charge or to obtain a refund of such tax, assessment or
          charge, including, with respect to any United States Tax,
          certification or documentation to the effect that such Holder or
          beneficial owner is a United States Alien and lacks other connections
          with the United States;

     (8)  any tax, assessment or other governmental charge which would not have
          been imposed but for the presentation of a Security (where
          presentations is required) for payment on the date more than 30 days
          after the date on which such payment became due and payable or the
          date on which payment thereof was duly provided for, whichever
          occurred later; or

                                       15
<PAGE>

     (9)  any combination of items above;

     nor shall Additional Amounts be paid with respect to any payment of the
     principal of, or premium, if any, or any interest on any Security to any
     such Holder who is a fiduciary or a partnership or a beneficial owner who
     is other than the sole beneficial owner of such payment to the extent a
     beneficiary or settlor with respect to such fiduciary or a member of such
     partnership or a beneficial owner would not have been entitled to such
     Additional Amount had it been the Holder of the Security.

     Whenever in this Security or in the Indenture there is a reference, in any
     context, to the payment of the principal of [if the Security is to bear
     interest prior to maturity, insert: or interest on], or in respect of, any
     Security, such payment shall be deemed to include the payment of Additional
     Amounts to the extent that, in such context, Additional Amounts are, were
     or would be payable in respect of such payment pursuant to the provisions
     hereof or thereof and express mention of the payment of Additional Amounts
     (if applicable) in any provision hereof shall not be construed as excluding
     Additional Amounts in those provisions hereof where such express mention is
     not made.

     [If the Security is an extendible security, insert: The Securities of this
     series are subject to repayment on [insert provisions with respect to
     repayment date or dates] at the option of the Holders thereof exercisable
     on or before [.], but not prior to the [.] preceding such [.], at a
     repayment price equal to the principal amount thereof to be repaid,
     together with interest payable thereon to the repayment date, as described
     on the reverse side hereof.]

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

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

In Witness Whereof, the Company has caused this instrument to be duly executed.
Dated:

 .......................................

By.....................................

Attest:

 .......................................

203. Form of Reverse of Security.

     This Security is one of a duly authorized issue of securities of the
     Company (herein called the "Securities"),  issued and to be issued in one
     or more series under an Indenture, dated as of [.] (herein called the
     "Indenture", which term shall have the meaning assigned to it in such
     instrument), between the Company [if applicable, insert:  , AEGON N.V., as
     Parent Guarantor (herein called the "Parent Guarantor"),] and [.], as
     Trustee (herein called the "Trustee", which term includes any successor
     trustee under the Indenture), and reference is hereby made to the Indenture
     for a statement of the respective rights, limitations of rights,

                                       16
<PAGE>

     duties and immunities thereunder of the Company [if applicable, insert: ,
     the Parent Guarantor,] the Trustee [, the holders of Senior Debt] and the
     Holders of the Securities and of the terms upon which the Securities and
     [if applicable, insert: the Parent Guarantees endorsed thereon] are, and
     are to be, authenticated and delivered. This Security is one of the series
     designated on the face hereof [if applicable, insert: limited in aggregate
     principal amount to [.]].

     [If applicable insert: If at any time subsequent to the issuance of the
     Securities of this series as a result of any change in, or amendment to,
     the laws or regulations or rulings of The Netherlands or of any political
     subdivision thereof or any authority therein or thereof having power to tax
     or as a result of any regulations or rulings or any amendment to or change
     in the application or official interpretation of such laws, regulations or
     rulings, the Company, or the Parent Guarantor, as the case may be, becomes,
     or will become, obligated to pay any Additional Amounts and such
     obligations cannot be avoided by the Company or, if applicable, the Parent
     Guarantor taking reasonable measures available to it, the Securities of
     this series will be redeemable as a whole (but not in part), at the option
     of the Company or the Parent Guarantor, at any time upon not less than
     thirty (30) nor more than sixty (60) days' notice given to the Holders at
     their principal amount [if the Security is to bear interest prior to
     maturity, insert: together with accrued interest thereon, if any,] [if the
     Security is an Original Issue Discount Security, insert appropriate
     provision] (and any Additional Amounts payable with respect thereto) to the
     date fixed for redemption (the "Tax Redemption Date").  In order to effect
     a redemption of Securities of this series as described in this paragraph,
     the Company or, if applicable, the Parent Guarantor shall deliver to the
     Trustee at least forty-five (45) days prior to the Tax Redemption Date: (i)
     a written notice stating that the Securities of this series are to be
     redeemed as a whole and (ii) an opinion of independent legal counsel of
     recognized standing to the effect that the Company or, if applicable, the
     Parent Guarantor has or will become obligated to pay Additional Amounts as
     a result of such change or amendment.  No notice of redemption may be given
     earlier than sixty (60) days prior to the earliest date on which the
     Company or, if applicable, the Parent Guarantor would be obligated to pay
     such Additional Amounts were a payment in respect of the Securities of this
     series then due.  The notice shall additionally specify the Tax Redemption
     Date and all other information necessary to the publication and mailing by
     the Trustee of notices of such redemption.  The Trustee shall be entitled
     to rely conclusively upon the information so furnished by the Company or,
     if applicable, the Parent Guarantor in such notice and shall be under no
     duty to check the accuracy or completeness thereof.  Such notice shall be
     irrevocable and upon its delivery the Company or, if applicable, the Parent
     Guarantor shall be obligated to make the payment or payments referred to
     therein to the Trustee.]

     [If applicable, insert: The Securities of this series are subject to
     redemption upon not less than 30 days' notice by mail, [if applicable,
     insert: (1) on [.] in any year commencing with the year 20[.] and ending
     with the year 20[.] through operation of the sinking fund for this series
     at a Redemption Price equal to 100% of the principal amount, and (2)] at
     any time [if applicable, insert: on or after, [.], 20[.], as a whole or in
     part, at the election of the Company, at the following Redemption Prices
     (expressed as percentages of the principal amount): If redeemed [if
     applicable, insert: on or before. [.], [.]%, and if redeemed] during the
     12-month period beginning [.] of the years indicated,

<TABLE>
<CAPTION>
Year            Redemption              Year               Redemption
                Price                                      Price
<S>             <C>                     <C>                <C>
</TABLE>

                                       17
<PAGE>

     and thereafter at a Redemption Price equal to [.]% of the principal amount,
     together in the case of any such redemption [if applicable, insert:
     (whether through operation of the sinking fund or otherwise)] with accrued
     interest to the Redemption Date, but interest installments whose Stated
     Maturity is on or prior to such Redemption Date will be payable to the
     Holders of such Securities, or one or more Predecessor Securities, of
     record at the close of business on the relevant Record Dates referred to on
     the face hereof, all as provided in the Indenture.]

     [If applicable, insert:    The Securities of this series are subject to
     redemption upon not less than 30 days' notice by mail, (1) on [.] in any
     year commencing with the year 20[.] and ending with the year 20[.] through
     operation of the sinking fund for this series at the Redemption Prices for
     redemption through operation of the sinking fund (expressed as percentages
     of the principal amount) set forth in the table below, and (2) at any time
     [if applicable, insert:  on or after, [.]], as a whole or in part, at the
     election of the Company, at the Redemption Prices for redemption otherwise
     than through operation of the sinking fund (expressed as percentages of the
     principal amount) set forth in the table below:  If redeemed during the 12-
     month period beginning [.] of the years indicated,

<TABLE>
<CAPTION>
Year                Redemption Price                  Redemption Price For
                    For Redemption                    Redemption Otherwise
                    Through Operation                 Than Through Operation
                    of the Sinking Fund               of the Sinking Fund
<S>                 <C>                               <C>
</TABLE>

     and thereafter at a Redemption Price equal to [.]% of the principal amount,
     together in the case of any such redemption (whether through operation of
     the sinking fund or otherwise) with accrued interest to the Redemption
     Date, but interest installments whose Stated Maturity is on or prior to
     such Redemption Date will be payable to the Holders of such Securities, or
     one or more Predecessor Securities, of record at the close of business on
     the relevant Record Dates referred to on the face hereof, all as provided
     in the Indenture.]

     [If applicable, insert:  Notwithstanding the foregoing, the Company may
     not, prior to [.], redeem any Securities of this series as contemplated by
     [if applicable, insert:  Clause (2) of] the preceding paragraph as a part
     of, or in anticipation of, any refunding operation by the application,
     directly or indirectly, of moneys borrowed having an interest cost to the
     Company (calculated in accordance with generally accepted financial
     practice) of less than [.]% per annum.]

     [If applicable, insert: The sinking fund for this series provides for the
     redemption on [.] in each year beginning with the year 20[.] and ending
     with the year 20[.] of [if applicable, insert: not less than [.]
     ("mandatory sinking fund") and not more than] [.] aggregate principal
     amount of Securities of this series. Securities of this series acquired or
     redeemed by the Company otherwise than through [if applicable, insert:
     mandatory] sinking fund payments may be credited against subsequent [if
     applicable, insert: mandatory] sinking fund payments otherwise required to
     be made [if applicable, insert: , in the inverse order in which they become
     due].]

     [If the Security is subject to redemption of any kind, insert: In the event
     of redemption of this Security in part only, a new Security or Securities
     of this series and of like tenor for the unredeemed portion hereof will be
     issued in the name of the Holder hereof upon the cancellation hereof.]

     [If applicable, insert paragraph regarding subordination of the Security.]

                                       18
<PAGE>

     [If applicable, insert:  The Indenture contains provisions for defeasance
     at any time of [the entire indebtedness of this Security] [or] [certain
     restrictive covenants and Events of Default with respect to this Security]
     [, in each case] upon compliance with certain conditions set forth in the
     Indenture.]

     [If the Security is a Convertible Security convertible at the option of the
     Holder, insert:  Subject to the provisions of the Indenture, the Holder
     hereof has the right, at his option at any time until 11:59 p.m. New York
     time on the fifth Business Day preceding the maturity date hereof (except
     that, in case this Convertible Security shall be called for redemption
     before maturity, such right shall terminate in respect of this Convertible
     Security at 11:59 p.m. New York time on the fifth Business Day preceding
     the date fixed for redemption of this Security unless AEGON N.V. shall
     default on payment due upon such redemption), to convert this Convertible
     Security (or any portion hereof which is $1,000 or an integral multiple
     thereof) into fully paid and nonassessable Common Shares of AEGON N.V. at
     the initial Conversion Price of [.] per Common Share, subject to such
     adjustment, if any, to the Conversion Price and the securities or other
     property issuable upon conversion as may be required by the provisions of
     the Indenture, but only upon surrender of this Convertible Security to the
     Trustee or to the Conversion Agent for surrender to AEGON N.V. in
     accordance with the instructions on file with the Conversion Agent,
     accompanied by a written notice of election to convert, which shall be
     substantially in the Form of Election to Convert contained in the
     Indenture, and (if required by AEGON N.V.) by an instrument or instruments
     of transfer, in form satisfactory to AEGON N.V. and the Conversion Agent,
     duly executed by the Holder or by his attorney duly authorized in writing.]

     [If the Security is a Convertible Security subject to mandatory conversion
     or conversion at the option of AEGON N.V., insert applicable provisions.]

     [If the Security is a Convertible Security convertible into Common Shares,
     insert: No payment or adjustment is to be made on conversion of this
     Convertible Security for interest accrued hereon or for dividends on Common
     Shares issued on conversion; provided, however, that if this Convertible
     Security is surrendered for conversion after the Regular Record Date for a
     payment of interest and on or before the Interest Payment Date, then,
     notwithstanding such conversion, the interest falling due to such Interest
     Payment Date will be paid to the person in whose name this Convertible
     Security is registered at the close of business on such Regular Record Date
     and any Convertible 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 must be accompanied by
     payment of an amount equal to the interest payable on such Interest Payment
     Date.  No fractional Common Shares shall be issuable upon any conversion,
     but in lieu thereof AEGON N.V. shall make an adjustment therefor in cash as
     provided in the Indenture.] [If the Cash Option applies, insert:  AEGON
     N.V. may elect to pay a Cash Option Amount in lieu of delivering Common
     Shares.]

     [If the Security is not an Original Issue Discount Security, insert:  If an
     Event of Default with respect to Securities of this series shall occur and
     be continuing, the principal of the Securities of this series may be
     declared due and payable in the manner and with the effect provided in the
     Indenture.]

     [If the Security is an Original Issue Discount Security, insert: If an
     Event of Default with respect to Securities of this series shall occur and
     be continuing, an amount of principal of the Securities of this series may
     be declared due and payable in the manner and with the effect provided in
     the Indenture. Such amount shall be equal to [insert formula for
     determining the

                                       19
<PAGE>

     amount.] Upon payment (i) of the amount of principal so declared due and
     payable and (ii) of interest on any overdue principal, premium and interest
     (in each case to the extent that the payment of such interest shall be
     legally enforceable), all of the Company's obligations in respect of the
     payment of the principal of and premium and interest, if any, on the
     Securities of this series shall terminate.]

     The Indenture permits, with certain exceptions as therein provided, the
     amendment thereof and the modification of the rights and obligations of the
     Company and, if applicable, the Parent Guarantor and the rights of the
     Holders of the Securities of each series to be affected under the Indenture
     at any time by the Company, the Parent Guarantor, if applicable, and the
     Trustee with the consent of the Holders of [a majority] in principal amount
     of the Securities at the time Outstanding of each series to be affected.
     The Indenture also contains provisions permitting the Holders of specified
     percentages in principal amount of the Securities of each series at the
     time Outstanding, on behalf of the Holders of all Securities of such
     series, to waive compliance by the Company and, if applicable, the Parent
     Guarantor 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 Security shall be conclusive and binding upon
     such Holder and upon all future Holders of this Security and of any
     Security issued upon the 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.

     As provided in and subject to the provisions of the Indenture, the Holder
     of this Security shall not have the right to institute any proceeding with
     respect to the Indenture or for the appointment of a receiver or trustee or
     for any other remedy thereunder, unless such Holder shall have previously
     given the Trustee written notice of a continuing Event of Default with
     respect to the Securities of this series, the Holders of not less than 25%
     in principal amount of the Securities of this series at the time
     Outstanding shall have made written request to the Trustee to institute
     proceedings in respect of such Event of Default as Trustee and offered the
     Trustee reasonable indemnity, and the Trustee shall not have received from
     the Holders of a majority in principal amount of Securities of this series
     at the time Outstanding a direction inconsistent with such request, and
     shall have failed to institute any such proceeding, for 60 days after
     receipt of such notice, request and offer of indemnity. The foregoing shall
     not apply to any suit instituted by the Holder of this Security for the
     enforcement of any payment of principal hereof or any premium or interest
     hereon on or after the respective due dates expressed herein.

     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 any premium and
     interest on this Security at the times, place and rate, and in the coin or
     currency, herein prescribed.

     As provided in the Indenture and subject to certain limitations set forth
     therein, the transfer of this Security is registrable in the Security
     Register, upon surrender of this Security for registration of transfer at
     the office or agency of the Company in any place where the principal of and
     any premium and interest on this Security are payable, duly endorsed by or
     accompanied by a written instrument of transfer in form satisfactory to the
     Company and the Security Registrar duly executed by the Holder hereof or
     his attorney duly authorized in writing, and thereupon one or more new
     Securities of this series and of like tenor, of authorized denominations
     and for the same aggregate principal amount, will be issued to the
     designated transferee or transferees.

     The Securities of this series are issuable [if applicable, insert:  only]
     in registered form without coupons [if applicable, insert:  or in bearer
     form] in denominations of [$1,000] and

                                       20
<PAGE>

     any integral multiple thereof. As provided in the Indenture and subject to
     certain limitations therein set forth, Securities of this series are
     exchangeable for a like aggregate principal amount of Securities of this
     series and of like tenor of a different authorized denomination, as
     requested by the Holder surrendering the same.

     No service charge shall be made for any such registration of transfer or
     exchange, but the Company may require payment of a sum sufficient to cover
     any tax or other governmental charge payable in connection therewith.

     Prior to due presentment of this Security for registration of transfer, the
     Company, the Trustee and any agent of the Company, the Parent Guarantor, if
     applicable, or the Trustee may treat the Person in whose name this Security
     is registered as the owner hereof for all purposes, whether or not this
     Security be overdue, and neither the Company, the Parent Guarantor, if
     applicable, the Trustee nor any such agent shall be affected by notice to
     the contrary.

     All terms used in this Security which are defined in the Indenture shall
     have the meanings assigned to them in the Indenture.

204. Form of Legend for Global Securities.

     Unless otherwise specified as contemplated by Section 301 for the
     Securities evidenced thereby, every Global Security authenticated and
     delivered hereunder shall bear a legend in substantially the following
     form:

     This Security is a Global Security within the meaning of the Indenture
     hereinafter referred to and is registered in the name of a Depositary or a
     nominee thereof. This Security may not be exchanged in whole or in part for
     a registered Security, and no transfer of this Security in whole or in part
     may be registered, in the name of any Person other than such Depositary or
     a nominee thereof, except in the limited circumstances described in the
     Indenture.

205. Form of Trustee's Certificate of Authentication.

     The Trustee's certificates of authentication shall be in substantially the
     following form:

     This is one of the Securities of the series designated therein referred to
     in the within mentioned Indenture.

Citibank, N.A.
As Trustee

By...............................
Authorized Signatory

Dated:...........................

206. Form of Election to Convert.

     The notice of conversion to be delivered by a Holder to the Conversion
     Agent in connection with the conversion of Convertible Securities of any
     series that are convertible into Common Shares shall be in substantially
     the following form, with such appropriate insertions,

                                       21
<PAGE>

     omissions, substitutions and other variations as are deemed necessary or
     appropriate by AEGON N.V. or the Trustee:

     Notice of Conversion

     The undersigned Holder of the Convertible Securities specified below hereby
     irrevocably exercises the option to convert such Convertible Securities, or
     the aggregate principal amount thereof specified below, into Common Shares
     of AEGON N.V., as indicated below, in accordance with the terms of the
     Convertible Securities and the Indenture dated as of  October 11, 2001 (the
     "Indenture") between AEGON N.V.,  AEGON Funding Corp., AEGON Funding Corp.
     II and [.], as Trustee, and directs that (i) the Common Shares issuable and
     deliverable upon conversion be issued in the name of and delivered to the
     undersigned unless a different name has been indicated below or (ii) the
     Cash Option Amount be delivered if AEGON N.V. elects to exercise its Cash
     Option.  AEGON N.V. shall cause any amounts due to the Holder to be paid as
     promptly as practicable.  If Common Shares are to be issued in the name of
     a Person other than the undersigned, the undersigned has paid all transfer
     taxes payable with respect thereto. All capitalized terms used herein and
     not defined herein shall have the meanings specified in the Indenture.

Dated:

 .......................................
Signature (for Conversion only)

Title of Convertible Securities:

Certificate Number(s)
(if applicable):

Aggregate Principal Amount Represented: (1)
Principal Amount to be Converted: (2)

(1)  Unless otherwise specified, a Holder will be deemed to be converting the
     entire principal amount of the Convertible Securities delivered.

(2)  Certificate registered in the name of the Holder will be issued in the
     principal amount of the Convertible Securities not converted, unless
     otherwise provided.

If Common Shares are to be received and are to be issued otherwise than to
Holder:

 .......................................
Please print name and address

If check for fractional Common Shares to be issued otherwise than to Holder:

 .......................................
Please print name and address

If AEGON N.V. elects the Cash Option, payment should be made in accordance with
the following instructions:

                                       22
<PAGE>

Payment to: ...........................
Please print name and address

For Account: ..........................

Please print name and address of Holder

 .......................................

 .......................................

Signature Guarantee: ..................

207. Form of Parent Guarantee.

     Parent Guarantee

     For value received, the Parent Guarantor hereby unconditionally guarantees,
     to the Holder of the Security upon which this Parent Guarantee is endorsed,
     and to the Trustee on behalf of such Holder, the due and punctual payment
     of the principal of (and premium, if any) and interest on such Security
     when and as the same shall become due and payable, whether at the Stated
     Maturity, by acceleration, call for redemption or otherwise, according to
     the terms thereof and of the Indenture referred to therein.  In case of the
     failure of the Company punctually to make any such payment, the Parent
     Guarantor hereby agrees to cause such payment to be made punctually when
     and as the same shall become due and payable, whether at the Stated
     Maturity or by acceleration, call for redemption or otherwise, and as if
     such payment were made by the Company.

     The Parent Guarantor hereby agrees that its obligations hereunder shall be
     absolute and unconditional, irrespective of any invalidity, irregularity or
     unenforceability of this Security or the Indenture, the absence of any
     action to enforce the same or any release or amendment or waiver of any
     term of any other guarantee of, all or of any of the Securities, any waiver
     or consent by the Holder of such Security or by the Trustee or either of
     them with respect to any provisions thereof or of the Indenture, the
     obtaining of any judgment against the Company or any action to enforce the
     same or any other circumstances which might otherwise constitute a legal or
     equitable discharge or defense of a guarantor; provided, however, that
     notwithstanding the foregoing, no such release, amendment, waiver, consent
     or judgment shall, without the consent of the Parent Guarantor, increase
     the principal amount of such Security or increase the rate or rates of
     interest thereon, or increase any premium payable upon redemption thereof,
     or alter the stated maturity thereof or increase the principal amount of
     any Original Issue Discount Security that would be due and payable upon a
     declaration of acceleration of maturity thereof.  The Parent Guarantor
     hereby waives the benefits of diligence, presentment, demand of payment,
     any requirement that the Trustee or any of the Holders exhaust any right or
     take any action against the Company or any other Person, filing of claims
     with a court in the event of insolvency or bankruptcy of the Company,
     protest or notice with respect to such Security or the indebtedness
     evidenced thereby, and covenants that this Parent Guarantee will not be
     discharged except by complete performance of the obligations contained in
     such Security and in this Parent Guarantee; provided, however, that the
     Parent Guarantor receives prompt written notice of any failure by the
     Company to make any payment of principal, premium, if any, or interest or
     any sinking fund or analogous payment.  The Parent Guarantor hereby agrees
     that, in the event of a default in payment of principal (or premium, if
     any) or interest on such Security, whether at their Stated Maturity,

                                       23
<PAGE>

     by acceleration, call for redemption, purchase or otherwise, legal
     proceedings may be instituted by the Trustee on behalf of, or by, the
     Holder of such Security, subject to the terms and conditions set forth in
     the Indenture, directly against the Parent Guarantor to enforce this Parent
     Guarantee without first proceeding against the Company.

     No reference herein to the Indenture and no provision of this Parent
     Guarantee or of the Indenture shall alter or impair the guarantee of the
     Parent Guarantor, which is absolute and unconditional, of the due and
     punctual payment of the principal (and premium, if any) and interest on the
     Security upon which this Parent Guarantee is endorsed.

     This Parent Guarantee shall remain in full force and effect and continue to
     be effective should any petition be filed by or against the Company for
     liquidation or reorganization, should the Company become insolvent or make
     an assignment for the benefit of creditors or should a receiver or trustee
     be appointed for all or any significant part of the Company's assets, and
     shall, to the fullest extent permitted by law, continue to be effective or
     be reinstated, as the case may be, if at any time payment and performance
     of the Securities is, pursuant to applicable law, rescinded or reduced in
     amount, or must otherwise be restored or returned by any obligee on the
     Securities, whether as a "voidable preference," "fraudulent transfer," or
     otherwise, all as though such payment or performance had not been made.  In
     the event that any payment, or any part thereof, is rescinded, reduced,
     restored or returned, the Securities shall, to the fullest extent permitted
     by law, be reinstated and deemed reduced only by such amount paid and not
     so rescinded, reduced, restored or returned.

     [If applicable, insert relevant subordination language in accordance with
     Article Fourteen.]

     All terms used in this Parent Guarantee which are defined in the Indenture
     referred to in the Security upon which this Parent Guarantee is endorsed
     shall have the meanings assigned to them in such Indenture.

     This Parent Guarantee shall not be valid or obligatory for any purpose
     until the certificate of authentication on the Security upon which this
     Parent Guarantee is endorsed shall have been executed by the Trustee under
     the Indenture by manual signature.

IN WITNESS WHEREOF, the Parent Guarantor has caused this Parent Guarantee to be
duly executed.

Dated:

 ......................................

By....................................

Attest:

 ......................................

                                THE SECURITIES

301. Amount Unlimited; Issuable in Series.

     The aggregate principal amount of Securities which may be authenticated and
     delivered under this Indenture is unlimited.

                                       24
<PAGE>

     Each Company may issue Securities in one or more series. For each Security
     or series thereof, there shall be established in or pursuant to a Board
     Resolution by the Company issuing such Security or series thereof and,
     subject to Section 303, set forth, or determined in the manner provided, in
     an Officers' Certificate, or established in one or more indentures
     supplemental hereto, prior to the issuance thereof:

     (1)  the issuer and title of the Securities of the series (which shall
          distinguish the Securities of the series from Securities of any other
          series);

     (2)  any limit upon the aggregate principal amount of the Securities of the
          series which may be authenticated and delivered under this Indenture
          (except for Securities authenticated and delivered upon registration
          of transfer of, or in exchange for, or in lieu of, other Securities of
          the series pursuant to Section 304, 305, 306, 906 or 1107 and except
          for any Securities which, pursuant to Section 303, are deemed never to
          have been authenticated and delivered hereunder);

     (3)  the Person to whom any interest on a Security of the series shall be
          payable, if other than 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;

     (4)  the date or dates, if any, on which the principal of any Securities of
          the series is payable;

     (5)  the rate or rates at which any Securities of the series shall bear
          interest, if any, the date or dates from which any such interest shall
          accrue, the Interest Payment Dates on which any such interest shall be
          payable and the Regular Record Date for any such interest payable on
          any Interest Payment Date;

     (6)  the place or places where the principal of and any premium and
          interest on any Securities of the series shall be payable;

     (7)  the period or periods within which, the price or prices at which and
          the terms and conditions upon which any Securities of the series may
          be redeemed, in whole or in part, at the option of the Company and, if
          other than by a Board Resolution, the manner in which any election by
          the Company to redeem the Securities shall be evidenced;

     (8)  the obligation, if any, of the Company to redeem or purchase any
          Securities of the series pursuant to any sinking fund or analogous
          provisions or at the option of the Holder thereof and the period or
          periods within which, the price or prices at which and the terms and
          conditions upon which any Securities of the series shall be redeemed
          or purchased, in whole or in part, pursuant to such obligation;

     (9)  if other than denominations of $1,000 and any integral multiple
          thereof, the denominations in which any Securities of the series shall
          be issuable;

     (10) if the amount of principal of or any premium or interest on any
          Securities of the series may be determined with reference to an index
          or pursuant to a formula, the manner in which such amounts shall be
          determined;

     (11) if other than the currency of the United States of America, the
          currency, currencies or currency units in which the principal of or
          any premium or interest on any Securities of the series shall be
          payable and the manner of determining the equivalent thereof in

                                       25
<PAGE>

          the currency of the United States of America for any purpose,
          including for purposes of the definition of "Outstanding" in Section
          101;

     (12) if the principal of or any premium or interest on any Securities of
          the series is to be payable, at the election of the Company or the
          Holder thereof, in one or more currencies or currency units other than
          that or those in which such Securities are stated to be payable, the
          currency, currencies or currency units in which the principal of or
          any premium or interest on such Securities as to which such election
          is made shall be payable, the periods within which and the terms and
          conditions upon which such election is to be made and the amount so
          payable (or the manner in which such amount shall be determined);

     (13) if other than the entire principal amount thereof, the portion of the
          principal amount of any Securities of the series which shall be
          payable upon declaration of acceleration of the Maturity thereof
          pursuant to Section 502;

     (14) if the principal amount payable at the Stated Maturity of any
          Securities of the series will not be determinable as of any one or
          more dates prior to the Stated Maturity, the amount which shall be
          deemed to be the principal amount of such Securities as of any such
          date for any purpose thereunder or hereunder, including the principal
          amount thereof which shall be due and payable upon any Maturity other
          than the Stated Maturity or which shall be deemed to be Outstanding as
          of any date prior to the Stated Maturity (or, in any such case, the
          manner in which such amount deemed to be the principal amount shall be
          determined);

     (15) if applicable, that the Securities of the series, in whole or any
          specified part, shall be defeasible pursuant to Section 1302 or
          Section 1303 or both such Sections and, if other than by a Board
          Resolution, the manner in which any election by the Company to defease
          such Securities shall be evidenced;

     (16) if applicable, that any Securities of the series shall be issuable in
          whole or in part in registered form, bearer form or in the form of one
          or more Global Securities and, in such case, the respective
          Depositaries for such Global Securities, the form of any legend or
          legends which shall be borne by any such Global Security in addition
          to or in lieu of that set forth in Section 204 and any circumstances
          in addition to or in lieu of those set forth in Clause (2) of the last
          paragraph of Section 305 in which any such Global Security may be
          exchanged in whole or in part for Securities registered, and any
          transfer of such Global Security in whole or in part may be
          registered, in the name or names of Persons other than the Depositary
          for such Global Security or a nominee thereof;

     (17) if the Securities of the series are Convertible Securities, the period
          or periods within which, the Conversion Price or Prices at which (and
          the adjustments to be made thereto, if otherwise than as provided in
          Section 1504) and the terms and conditions upon which the Convertible
          Securities of the series may be converted, in whole or in part,
          whether such conversion is mandatory, at the option of the Holders of
          the Convertible Securities of the series or at the option of AEGON
          N.V., whether the Common Shares issuable upon conversion will be New
          York Shares or Ordinary Shares or either New York Shares or Ordinary
          Shares at the option of the Holder or at the option of AEGON N.V.,
          whether the Cash Option applies and the identity of any Conversion
          Agent for Convertible Securities of the series if other than or in
          addition to the Trustee;

     (18) any addition to or change in the Events of Default, including any
          grace periods, which

                                       26
<PAGE>

          applies to any Securities of the series and any change in the right of
          the Trustee or the requisite Holders of such Securities to declare the
          principal amount thereof due and payable pursuant to Section 502;

     (19) if applicable, that the Securities of the series and, if applicable,
          the Parent Guarantee shall be subordinated in right of payment to
          Senior Debt as provided in Article Fourteen;

     (20) any addition to or change in the covenants set forth in Article Ten
          which applies to Securities of the series; and

     (21) any other terms of the Security or series thereof (which terms shall
          not be inconsistent with the provisions of this Indenture, except as
          permitted by Section 901(5)).

     All Securities of any one series shall be substantially identical except as
     to denomination and except as may otherwise be provided in or pursuant to
     the Board Resolution referred to above and (subject to Section 303) set
     forth, or determined in the manner provided, in the Officers' Certificate
     referred to above or in any such indenture supplemental hereto.  All
     Securities to be issued by AEGON Funding or AEGON Funding II shall have
     endorsed thereon a Parent Guarantee as provided in Section 205.

     If any of the terms of the series are established by action taken pursuant
     to a Board Resolution, a copy of an appropriate record of such action shall
     be delivered to the Trustee at or prior to the delivery of the Officers'
     Certificate setting forth the terms of the series.

302. Denominations.

     Unless otherwise set forth in a Board Resolution pursuant to Section 301,
     the Securities of each series shall be issuable only in registered form
     without coupons and only in such denominations as shall be specified as
     contemplated by Section 301.  In the absence of any such specified
     denomination with respect to the Securities of any series, the Securities
     of such series shall be issuable in denominations of $1,000 and any
     integral multiple thereof.

303. Execution, Authentication, Delivery and Dating.

     Securities shall be executed on behalf of the Company issuing such
     Securities by its Chairman of the Board of Directors, its Vice Chairman of
     the Board of Directors, its President or one of its Vice Presidents.  The
     signature of any of these officers on the Securities may be manual or
     facsimile.

     Securities bearing the manual or facsimile signatures of individuals who
     were at any time the proper officers of the Company shall bind the Company,
     notwithstanding that such individuals or any of them have ceased to hold
     such offices prior to the authentication and delivery of such Securities or
     did not hold such offices at the date of such Securities.

     At any time and from time to time after the execution and delivery of this
     Indenture, the Company may deliver Securities of any series executed by the
     Company and, if applicable, having endorsed thereon the Parent Guarantee
     executed by the Parent Guarantor to the Trustee for authentication,
     together with a Company Order for the authentication and delivery of such
     Securities, if applicable with the Parent Guarantee of the Parent Guarantor
     endorsed thereon, and the Trustee in accordance with the Company Order
     shall authenticate and deliver such Securities, if applicable with the
     Parent Guarantee of the Parent Guarantor endorsed thereon, as in this
     Indenture provided and not otherwise. If the form or terms of the
     Securities of the series have been established by or pursuant to one or
     more Board Resolutions as

                                       27
<PAGE>

     permitted by Sections 201 and 301, in authenticating such Securities, and
     accepting the additional responsibilities under this Indenture in relation
     to such Securities, the Trustee shall be entitled to receive, and (subject
     to Section 601) shall be fully protected in relying upon, an Opinion of
     Counsel stating:

     (1)  if the form of such Securities has been established by or pursuant to
          a Board Resolution as permitted by Section 201, that such form has
          been established in conformity with the provisions of this Indenture;

     (2)  if the terms of such Securities have been established by or pursuant
          to a Board Resolution as permitted by Section 301, that such terms
          have been established in conformity with the provisions of this
          Indenture; and

     (3)  that such Securities, when authenticated and delivered by the Trustee
          and issued by the Company in the manner and subject to any conditions
          specified in such Opinion of Counsel, will constitute valid and
          legally binding obligations of the Company enforceable in accordance
          with their terms, subject to bankruptcy, insolvency, fraudulent
          transfer, reorganization, moratorium and similar laws of general
          applicability relating to or affecting creditors' rights and to
          general equity principles.

     If such form or terms have been so established, the Trustee shall not be
     required to authenticate such Securities if the issue of such Securities
     pursuant to this Indenture will affect the Trustee's own rights, duties or
     immunities under the Securities and this Indenture or otherwise in a manner
     which is not reasonably acceptable to the Trustee.

     Notwithstanding the provisions of Section 301 and of the preceding
     paragraph, if all Securities of a series are not to be originally issued at
     one time, it shall not be necessary to deliver the Officers' Certificate
     otherwise required pursuant to Section 301 or the Company Order and Opinion
     of Counsel otherwise required pursuant to such preceding paragraph at or
     prior to the authentication of each Security of such series if such
     documents are delivered at or prior to the authentication upon original
     issuance of the first Security of such series to be issued.

     Each Security shall be dated the date of its authentication.

     No Security or Parent Guarantee endorsed thereon 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 the Trustee by
     manual signature, and such certificate upon any Security shall be
     conclusive evidence, and the only evidence, that such Security and the
     Parent Guarantee endorsed thereon has been duly authenticated and delivered
     hereunder. Notwithstanding the foregoing, if any Security shall have been
     authenticated and delivered hereunder but never issued and sold by the
     Company, and the Company shall deliver such Security to the Trustee for
     cancellation as provided in Section 309, for all purposes of this Indenture
     such Security shall be deemed never to have been authenticated and
     delivered hereunder and shall never be entitled to the benefits of this
     Indenture.

304. Temporary Securities.

     Pending the preparation of definitive Securities of any series, the Company
     may execute, and upon Company Order the Trustee shall authenticate and
     deliver, temporary Securities which are printed, lithographed, typewritten,
     mimeographed or otherwise produced, in any authorized denomination,
     substantially of the tenor of the definitive Securities in lieu of which

                                       28
<PAGE>

     they are issued and, if applicable, having endorsed thereon the Parent
     Guarantees substantially of the tenor of the definitive Parent Guarantees
     in lieu of which they are issued duly executed by the Parent Guarantor and
     with such appropriate insertions, omissions, substitutions and other
     variations as the officers executing such Securities and, if applicable,
     the Parent Guarantees may determine, as evidenced by their execution of
     such Securities and, if applicable, Parent Guarantees.

     If temporary Securities of any series are issued, the Company will cause
     definitive Securities of that series to be prepared without unreasonable
     delay. After the preparation of definitive Securities of such series, the
     temporary Securities of such series shall be exchangeable for definitive
     Securities of such series upon surrender of the temporary Securities of
     such series at the office or agency of the Company in a Place of Payment
     for that series, without charge to the Holder. Upon surrender for
     cancellation of any one or more temporary Securities of any series, the
     Company shall execute and the Trustee shall authenticate and deliver in
     exchange therefor one or more definitive Securities of the same series, of
     any authorized denominations and of like tenor and aggregate principal
     amount, and, if applicable, having endorsed thereon Parent Guarantees
     executed by the Parent Guarantor. Until so exchanged, the temporary
     Securities of any series shall in all respects be entitled to the same
     benefits under this Indenture as definitive Securities of such series and
     tenor.

305. Registration, Registration of Transfer and Exchange.

     The Company shall cause to be kept a register (the register maintained in
     such office and in any other office or agency of the Company in a Place of
     Payment being herein sometimes collectively referred to as the "Security
     Register") in which, subject to such reasonable regulations as it may
     prescribe, the Company shall provide for the registration of Securities and
     of transfers of Securities. The Company may act as "Security Registrar" or
     appoint the Trustee or one or more agents to register and transfer
     Securities.

     Upon surrender for registration of transfer of any Security of a series at
     the office or agency of the Security Registrar in a Place of Payment for
     that series, the Company shall execute, and the Trustee shall authenticate
     and deliver, in the name of the designated transferee or transferees, one
     or more new Securities of the same series, of any authorized denominations
     and of like tenor and aggregate principal amount, each such Security having
     endorsed, if applicable, thereon the Parent Guarantee of the Parent
     Guarantor.

     At the option of the Holder, Securities of any series may be exchanged for
     other Securities of the same series, of any authorized denominations and of
     like tenor and aggregate principal amount, and, if applicable, having the
     Parent Guarantee of the Parent Guarantor endorsed thereon executed by the
     Parent Guarantor, upon surrender of the Securities to be exchanged at such
     office or agency. Whenever any Securities are so surrendered for exchange,
     the Company shall execute, the Parent Guarantor shall execute the Parent
     Guarantee endorsed thereon, if applicable, and the Trustee shall
     authenticate and deliver, the Securities which the Holder making the
     exchange is entitled to receive.

     All Securities and any Parent Guarantees endorsed thereon issued upon any
     registration of transfer or exchange of Securities shall be the valid
     obligations of the Company and the Parent Guarantor, evidencing the same
     debt, and entitled to the same benefits under this Indenture, as the
     Securities and Parent Guarantees endorsed thereon surrendered upon such
     registration of transfer or exchange.

     Every Security presented or surrendered for registration of transfer or for
     exchange shall (if so required by the Company or the Trustee) be duly
     endorsed, or be accompanied by a written

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<PAGE>

     instrument of transfer in form satisfactory to the Company and the Security
     Registrar duly executed, by the Holder thereof or his attorney duly
     authorized in writing.

     No service charge shall be made for any registration of transfer or
     exchange of Securities, but the Company may require payment of a sum
     sufficient to cover any tax or other governmental charge that may be
     imposed in connection with any registration of transfer or exchange of
     Securities, other than exchanges pursuant to Section 304, 906 or 1107 not
     involving any transfer.

     If the Securities of any series (or of any series and specified tenor) are
     to be redeemed in part, the Company shall not be required (A) to issue,
     register the transfer of or exchange any Securities of that series (or of
     that series and specified tenor, as the case may be) during a period
     beginning at the opening of business 15 days before the day of the mailing
     of a notice of redemption of any such Securities selected for redemption
     under Section 1103 and ending at the close of business on the day of such
     mailing, or (B) to register the transfer of or exchange any Security so
     selected for redemption in whole or in part, except the unredeemed portion
     of any Security being redeemed in part.

     The provisions of Clauses (1), (2), (3) and (4) below shall apply only to
     Global Securities:

     (1)  Each Global Security authenticated under this Indenture shall be
          registered in the name of the Depositary designated for such Global
          Security or a nominee thereof and delivered to such Depositary or a
          nominee thereof or custodian therefor, and each such Global Security
          shall constitute a single Security for all purposes of this Indenture.

     (2)  Notwithstanding any other provision in this Indenture, no Global
          Security may be exchanged in whole or in part for Securities
          registered, and no transfer of a Global Security in whole or in part
          may be registered, in the name of any Person other than the Depositary
          for such Global Security or a nominee thereof unless: (A) such
          Depositary (i) has notified the Company that it is unwilling or unable
          to continue as Depositary for such Global Security or (ii) has ceased
          to be a clearing agency registered under the Exchange Act, (B) there
          shall have occurred and be continuing an Event of Default with respect
          to such Global Security or (C) there shall exist such circumstances,
          if any, in addition to or in lieu of the foregoing as have been
          specified for this purpose as contemplated by Section 301.

     (3)  Subject to Clause (2) above, any exchange of a Global Security for
          other Securities may be made in whole or in part, and all Securities
          issued in exchange for a Global Security or any portion thereof shall
          be registered in such names as the Depositary for such Global Security
          shall direct.

     (4)  Every Security authenticated and delivered upon registration of
          transfer of, or in exchange for or in lieu of, a Global Security or
          any portion thereof, whether pursuant to this Section, Section 304,
          306, 906 or 1107 or otherwise, shall be authenticated and delivered in
          the form of, and shall be, a Global Security, unless such Security is
          registered in the name of a Person other than the Depositary for such
          Global Security or a nominee thereof.

306. Mutilated, Destroyed, Lost and Stolen Securities.

     If any mutilated Security is surrendered to the Trustee or the Security
     Registrar, the Company shall execute, if applicable the Parent Guarantor
     shall execute its Parent Guarantee endorsed

                                       30
<PAGE>

      thereon, and the Trustee shall authenticate and deliver in exchange
      therefor a new Security of the same series and of like tenor and principal
      amount and bearing a number not contemporaneously outstanding.

      If there shall be delivered to the Company and the Trustee (i) evidence to
      their satisfaction of the destruction, loss or theft of any Security and
      (ii) such security or indemnity as may be required by them to save each of
      them, if applicable the Parent Guarantor and any agent of any of them
      harmless, then, in the absence of notice to the Company or the Trustee
      that such Security has been acquired by a bona fide purchaser, the Company
      shall execute and the Trustee shall authenticate and deliver, in lieu of
      any such destroyed, lost or stolen Security, a new Security of the same
      series and 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 may,
      instead of issuing a new Security, pay such Security.

      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 of any series issued pursuant to this Section in lieu
      of any destroyed, lost or stolen Security, and, if applicable, the Parent
      Guarantee endorsed thereon, shall constitute an original additional
      contractual obligation of the Company and, if applicable, the Parent
      Guarantor, whether or not the destroyed, lost or stolen Security shall be
      at any time enforceable by anyone, and shall be entitled to all the
      benefits of this Indenture equally and proportionately with any and all
      other Securities of that series duly issued hereunder.

      The provisions of this Section 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.

307.  Payment of Interest; Interest Rights Preserved.

      Except as otherwise provided as contemplated by Section 301 with respect
      to any series of Securities, 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.

      Any interest on any Security of any series which is payable, but is not
      punctually paid or duly provided for, on any Interest Payment Date (herein
      called "Defaulted Interest") shall forthwith cease to be payable to the
      Holder on the relevant Regular Record Date by virtue of having been such
      Holder, and such Defaulted Interest may be paid by the Company, at its
      election in each case, as provided in Clause (1) or (2) below:

      (1)  The Company may elect to make payment of any Defaulted Interest to
           the Persons in whose names the Securities of such series (or their
           respective Predecessor Securities) are registered at the close of
           business on a Special Record Date for the payment of such Defaulted
           Interest, which shall be fixed in the following manner. The Company
           shall notify the Trustee in writing of the amount of Defaulted
           Interest proposed to be paid on each Security of such series and the
           date of the proposed payment, and at the

                                       31
<PAGE>

           same time the Company shall deposit with the Trustee an amount of
           money equal to the aggregate amount proposed to be paid in respect of
           such Defaulted Interest or shall make arrangements satisfactory to
           the Trustee for such deposit prior to the date of the proposed
           payment, such money when deposited to be held in trust for the
           benefit of the Persons entitled to such Defaulted Interest as in this
           Clause provided. Thereupon the Trustee shall fix a Special Record
           Date for the payment of such Defaulted Interest which shall be not
           more than 15 days and not less than 10 days prior to the date of the
           proposed payment and not less than 10 days after the receipt by the
           Trustee of the notice of the proposed payment. The Trustee shall
           promptly notify the Company of such Special Record Date and, in the
           name and at the expense of the Company, shall cause notice of the
           proposed payment of such Defaulted Interest and the Special Record
           Date therefor to be given to each Holder of Securities of such series
           in the manner set forth in Section 106, not less than 10 days prior
           to such Special Record Date. Notice of the proposed payment of such
           Defaulted Interest and the Special Record Date therefor having been
           so mailed, such Defaulted Interest shall be paid to the Persons in
           whose names the Securities of such series (or their respective
           Predecessor Securities) are registered at the close of business on
           such Special Record Date and shall no longer be payable pursuant to
           the following Clause (2).

      (2)  The Company may make payment of any Defaulted Interest on the
           Securities of any series in any other lawful manner not inconsistent
           with the requirements of any securities exchange on which such
           Securities may be listed, and upon such notice as may be required by
           such exchange, if, after notice given by the Company to the Trustee
           of the proposed payment pursuant to this Clause, such manner of
           payment shall be deemed practicable by the Trustee.

      Subject to the foregoing provisions of this Section, each Security
      delivered under this Indenture upon registration of transfer of or in
      exchange for or in lieu of any other Security shall carry the rights to
      interest accrued and unpaid, and to accrue, which were carried by such
      other Security.

308.  Persons Deemed Owners.

      Prior to due presentment of a Security for registration of transfer, the
      Company, the Trustee and any agent of the Company, the Parent Guarantor,
      if applicable, or the Trustee may treat the Person in whose name such
      Security is registered as the owner of such Security for the purpose of
      receiving payment of principal of and any premium and (subject to Section
      307) any interest on such Security and for all other purposes whatsoever,
      whether or not such Security be overdue, and neither the Company, the
      Parent Guarantor, if applicable, the Trustee nor any agent of any of them
      shall be affected by notice to the contrary.

309.  Cancellation.

      All Securities surrendered for payment, redemption, registration of
      transfer or exchange or for credit against any sinking fund payment shall,
      if surrendered to any Person other than the Trustee, be delivered to the
      Trustee and shall be promptly cancelled by the Trustee. The Company may at
      any time deliver to the Trustee for cancellation any Securities previously
      authenticated and delivered hereunder which the Company may have acquired
      in any manner whatsoever, and may deliver to the Trustee (or to any other
      Person for delivery to the Trustee) for cancellation any Securities
      previously authenticated hereunder which the Company has not issued and
      sold, and all Securities so delivered shall be promptly cancelled by the
      Trustee. No Securities shall be authenticated in lieu of or in exchange
      for any Securities cancelled as

                                       32
<PAGE>

      provided in this Section, except as expressly permitted by this Indenture.
      All cancelled Securities held by the Trustee shall be disposed of as
      directed by a Company Order.

310.  Computation of Interest.

      Except as otherwise specified as contemplated by Section 301 for
      Securities of any series, interest on the Securities of each series shall
      be computed on the basis of a 360-day year of twelve 30-day months.

                          SATISFACTION AND DISCHARGE

401.  Satisfaction and Discharge of Indenture.

      This Indenture shall upon Company Request cease to be of further effect
      (except as to any surviving rights of registration of transfer or exchange
      of Securities herein expressly provided for), and the Trustee, at the
      expense of the Company, shall execute proper instruments acknowledging
      satisfaction and discharge of this Indenture, when

      (1)  either:

           (A)  all Securities theretofore authenticated and delivered (other
                than (i) Securities which have been destroyed, lost or stolen
                and which have been replaced or paid as provided in Section 306
                and (ii) Securities for whose payment money has theretofore been
                deposited in trust or segregated and held in trust by the
                Company and thereafter repaid to the Company or discharged from
                such trust, as provided in Section 1003) have been delivered to
                the Trustee for cancellation; or

           (B)  all such Securities not theretofore delivered to the Trustee for
                cancellation:

                (i)   have become due and payable, or

                (ii)  will become due and payable at their Stated Maturity
                      within one year, or

                (iii) are to be called for redemption within one year under
                      arrangements satisfactory to the Trustee for the giving of
                      notice of redemption by the Trustee in the name, and at
                      the expense, of the Company,

           and the Company, or, if applicable, the Parent Guarantor, in the case
           of (i), (ii) or (iii) above, has deposited or caused to be deposited
           with the Trustee as trust funds in trust for the purpose money in an
           amount sufficient to pay and discharge the entire indebtedness on
           such Securities not theretofore delivered to the Trustee for
           cancellation, for principal and any premium and interest to the date
           of such deposit (in the case of Securities which have become due and
           payable) or to the Stated Maturity or Redemption Date, as the case
           may be;

      (2)  the Company or, if applicable, the Parent Guarantor has paid or
           caused to be paid all other sums payable hereunder by the Company and
           the Parent Guarantor; and

      (3)  the Company has delivered to the Trustee an Officers' Certificate and
           an Opinion of Counsel, each stating that all conditions precedent
           herein provided for relating to the satisfaction and discharge of
           this Indenture have been complied with.

                                       33
<PAGE>

      Notwithstanding the satisfaction and discharge of this Indenture, the
      obligations of the Company to the Trustee under Section 607, the
      obligations of the Trustee to any Authenticating Agent under Section 614,
      the conversion rights, if any, of Holders of Outstanding Securities of
      such series and the Company's obligations, if any, under Article Fifteen
      and, if money shall have been deposited with the Trustee pursuant to
      subclause (B) of Clause (1) of this Section, the obligations of the
      Trustee under Section 402 and the last paragraph of Section 1003 shall
      survive such satisfaction and discharge.

402.  Application of Trust Money.

      Subject to the provisions of the last paragraph of Section 1003, all money
      deposited with the Trustee pursuant to Section 401 shall be held in trust
      and applied by it, in accordance with the provisions of the Securities and
      this Indenture, to the payment, either directly or through any Paying
      Agent (including the Company acting as its own Paying Agent) as the
      Trustee may determine, to the Persons entitled thereto, of the principal
      and any premium and interest for whose payment such money has been
      deposited with the Trustee.

                                   REMEDIES

501.  Events of Default.

      "Event of Default", wherever used herein with respect to Securities of any
      series, means any one of the following events (whatever the reason for
      such Event of Default and whether it shall 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):

      (1)  default in the payment of any interest upon any Security of that
           series when it becomes due and payable, and continuance of such
           default for a period of 30 days or such longer grace period as may be
           established therefor pursuant to Section 301; or

      (2)  default in the payment of the principal of or any premium on any
           Security of that series at its Maturity and continuance of such
           default for any grace period established therefor pursuant to Section
           301; or

      (3)  default in the deposit of any sinking fund payment, when and as due
           by the terms of a Security of that series and continuance of such
           default for any grace period established therefor pursuant to Section
           301; or

      (4)  default in the performance, or breach, of any covenant or warranty of
           the Company in this Indenture (other than a covenant or warranty a
           default in whose performance or whose breach is elsewhere in this
           Section specifically dealt with or which has expressly been included
           in this Indenture solely for the benefit of a series of Securities
           other than that series), and continuance of such default or breach
           for a period of 90 days after there has been given, by registered or
           certified mail, to the Company and the Parent Guarantor, if
           applicable, by the Trustee or to the Company and the Parent
           Guarantor, if applicable, and the Trustee by the Holders of at least
           25% in principal amount of the Outstanding Securities of that series
           a written notice specifying such default or breach and requiring it
           to be remedied and stating that such notice is a "Notice of Default"
           hereunder; or

      (5)  the entry by a court having jurisdiction in the premises of (A) a
           decree or order for relief in respect of the Company or, if
           applicable, the Parent Guarantor in an

                                       34
<PAGE>

           involuntary case or proceeding under any applicable Federal or State
           bankruptcy, insolvency, reorganization or other similar law or (B) a
           decree or order adjudging the Company or, if applicable, the Parent
           Guarantor 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, if applicable, the
           Parent Guarantor under any applicable Federal or State law, or
           appointing a custodian, receiver, liquidator, assignee, trustee,
           sequestrator or other similar official of the Company or, if
           applicable, the Parent Guarantor or of any substantial part of the
           property of the Company or, if applicable, the Parent Guarantor, or
           ordering the winding up or liquidation of the affairs of the Company
           or, if applicable, the Parent Guarantor, 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

      (6)  the commencement by the Company or, if applicable, the Parent
           Guarantor of a voluntary case or proceeding under any applicable
           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 it to the entry of a decree
           or order for relief in respect of the Company or, if applicable, the
           Parent Guarantor in an involuntary case or proceeding under any
           applicable Federal or State bankruptcy, insolvency, reorganization or
           other similar law or to the commencement of any bankruptcy or
           insolvency case or proceeding against it, or the filing by it of a
           petition or answer or consent seeking reorganization or relief under
           any applicable Federal or State law, or the consent by it to the
           filing of such petition or to the appointment of or taking possession
           by a custodian, receiver, liquidator, assignee, trustee, sequestrator
           or other similar official of the Company or, if applicable, the
           Parent Guarantor or of any substantial part of the property of either
           of them, or the making by the Company or, if applicable, the Parent
           Guarantor of an assignment for the benefit of creditors, or the
           admission by either the Company or, if applicable, the Parent
           Guarantor in writing of an inability to pay its debts generally as
           they become due, or the taking of corporate action by the Company or,
           if applicable, the Parent Guarantor in furtherance of any such
           action; or

      (7)  any other Event of Default specified with respect to Securities of
           that series in a Board Resolution specified as contemplated by
           Section 301.

502.  Acceleration of Maturity; Rescission and Annulment.

      If an Event of Default with respect to Securities of any series at the
      time Outstanding occurs and is continuing, then in every such case the
      Trustee or the Holders of not less than 25% in principal amount of the
      Outstanding Securities of that series may declare the principal amount of
      all the Securities of that series (or, if any Securities of that series
      are Original Issue Discount Securities, such portion of the principal
      amount of such Securities as may be specified by the terms thereof) to be
      due and payable immediately, by a notice in writing to the Company (and to
      the Trustee if given by Holders), and upon any such declaration such
      principal amount (or specified amount) shall become immediately due and
      payable.

                                       35
<PAGE>

      At any time after such a declaration of acceleration with respect to
      Securities of any series has been made and before a judgment or decree for
      payment of the money due has been obtained by the Trustee as hereinafter
      in this Article provided, the Holders of a majority in principal amount of
      the Outstanding Securities of that series, by written notice to the
      Company and the Trustee, may rescind and annul such declaration and its
      consequences if:

      (1)  the Company has paid or deposited with the Trustee a sum sufficient
           to pay

           (A)  all overdue interest on all Securities of that series,

           (B)  the principal of (and premium, if any, on) any Securities of
                that series which have become due otherwise than by such
                declaration of acceleration and any interest thereon at the rate
                or rates prescribed therefor in such Securities,

           (C)  to the extent that payment of such interest is lawful, interest
                upon overdue interest at the rate or rates prescribed therefor
                in such Securities, and

           (D)  all sums paid or advanced by the Trustee hereunder and the
                reasonable compensation, expenses, disbursements and advances of
                the Trustee, its agents and counsel;

           and:

      (2)  all Events of Default with respect to Securities of that series,
           other than the non-payment of the principal of Securities of that
           series which have become due solely by such declaration of
           acceleration, have been cured or waived as provided in Section 513.

      No such rescission shall affect any subsequent default or impair any right
      consequent thereon.

503.  Collection of Indebtedness and Suits for Enforcement by Trustee.

      The Company covenants that if:

      (1)  default is made in the payment of any interest on any Security when
           such interest becomes due and payable and such default continues for
           a period of 30 days or such longer grace period as may be established
           therefor pursuant to section 301, or

      (2)  default is made in the payment of the principal of (or premium, if
           any, on) any Security at the Maturity thereof and such default
           continues for any grace period established therefor pursuant to
           Section 301,

      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
      on such Securities for principal and any premium and interest and, to the
      extent that payment of such interest shall be legally enforceable,
      interest on any overdue principal and premium and on any overdue interest,
      at the rate or rates prescribed therefor in such Securities, and, in
      addition thereto, such further amount as shall be sufficient to cover the
      costs and expenses of collection, including the reasonable compensation,
      expenses, disbursements and advances of the Trustee, its agents and
      counsel.

      If an Event of Default with respect to Securities of any series occurs and
      is continuing, the Trustee may in its discretion proceed to protect and
      enforce its rights and the rights of the

                                       36
<PAGE>

      Holders of Securities of such series by such appropriate judicial
      proceedings as the Trustee shall deem most effectual 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.

504.  Trustee May File Proofs of Claim.

      In case of any judicial proceeding relative to the Company, the Parent
      Guarantor, if applicable, or any other obligor upon the Securities, its
      property or its creditors, the Trustee shall be entitled and empowered, by
      intervention in such proceeding or otherwise, to take any and all actions
      authorized under the Trust Indenture Act in order to have claims of the
      Holders and the Trustee allowed in any such proceeding. In particular, the
      Trustee shall be authorized to collect and receive any moneys or other
      property payable or deliverable on any such claims and to distribute the
      same; and any custodian, receiver, assignee, trustee, liquidator,
      sequestrator or other similar official in any such judicial proceeding is
      hereby authorized by each Holder to make such payments to the Trustee and,
      in the event that the Trustee shall consent to the making of such payments
      directly to the Holders, to pay to the Trustee any amount due 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 607.

      No provision of this Indenture shall be deemed to authorize the Trustee to
      authorize or consent to accept or adopt on behalf of any Holder 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 in any such proceeding;
      provided, however, that the Trustee may, on behalf of the Holders, vote
      for the election of a trustee in bankruptcy or similar official and be a
      member of a creditors' or other similar committee.

505.  Trustee May Enforce Claims Without Possession of Securities.

      All rights of action and claims under this Indenture or the Securities may
      be prosecuted and enforced by the Trustee without the possession of any of
      the Securities or the production thereof in any proceeding relating
      thereto, and any such proceeding instituted by the Trustee shall be
      brought in its own name as trustee of an express trust, and any recovery
      of judgment shall, after provision for the payment of the reasonable
      compensation, expenses, disbursements and advances of the Trustee, its
      agents and counsel, be for the ratable benefit of the Holders of the
      Securities in respect of which such judgment has been recovered.

506.  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
      any premium or interest, 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 under Section 607;

      SECOND:  Subject to Article Fourteen, to payment of Senior Debt;

      THIRD:   Subject to Article Fourteen, to the payment of the amounts then
               due and unpaid for principal of and any premium and interest on
               the Securities in respect of which or for the benefit of which
               such money has been collected, ratably, without preference or
               priority of any kind, according to the amounts

                                       37
<PAGE>

               due and payable on such Securities for principal and any premium
               and interest, respectively; and

      FOURTH:  To the Company.

507.  Limitation on Suits.

      No Holder of any Security of any series shall have any right to institute
      any proceeding, judicial or otherwise, with respect to this Indenture, or
      for the appointment of a receiver or trustee, or for any other remedy
      hereunder, unless:

      (1)  such Holder has previously given written notice to the Trustee of a
           continuing Event of Default with respect to the Securities of that
           series;

      (2)  the Holders of not less than 25% in aggregate principal amount of the
           Outstanding Securities of that series shall have made written request
           to the Trustee to institute proceedings in respect of such Event of
           Default in its own name as Trustee hereunder;

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

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

      (5)  no direction inconsistent with such written request has been given to
           the Trustee during such 60-day period by the Holders of a majority
           aggregate in principal amount of the Outstanding Securities of that
           series;

      it being understood and intended that no one or more of such Holders shall
      have any right in any manner whatever by virtue of, or by availing of, any
      provision of this Indenture to affect, disturb or prejudice the rights of
      any other of such Holders, or to obtain or to seek to obtain priority or
      preference over any other of such Holders or to enforce any right under
      this Indenture, except in the manner herein provided and for the equal and
      ratable benefit of all of such Holders.

508.  Unconditional Right of Holders to Receive Principal Premium and Interest.

      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 any premium and (subject to
      Section 307) interest on such Security on the respective Stated Maturities
      expressed in such Security (or, in the case of redemption, on the
      Redemption Date) and to institute suit for the enforcement of any such
      payment, and such rights shall not be impaired without the consent of such
      Holder.

509.  Restoration of Rights and Remedies.

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

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<PAGE>

510.  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 306, no right or remedy herein conferred upon or reserved to the
      Trustee or to the Holders is intended to be exclusive of any other right
      or remedy, and every right and remedy shall, to the extent permitted by
      law, be cumulative and in addition to every other right and remedy given
      hereunder or now or hereafter existing at law or in equity or otherwise.
      The assertion or employment of any right or remedy hereunder, or
      otherwise, shall not prevent the concurrent assertion or employment of any
      other appropriate right or remedy.

511.  Delay or Omission Not Waiver.

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

512.  Control by Holders.

      The Holders of a majority in principal amount of the Outstanding
      Securities of any series 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, with
      respect to the Securities of such series, provided that:

      (1)  such direction shall not be in conflict with any rule of law or with
           this Indenture, and

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

513.  Waiver of Past Defaults.

      The Holders of not less than a majority in principal amount of the
      Outstanding Securities of any series may on behalf of the Holders of all
      the Securities of such series waive any past default hereunder with
      respect to such series and its consequences, except a default

      (1)  in the payment of the principal of or any premium or interest on any
           Security of such series, or

      (2)  in respect of a covenant or provision hereof which under Article Nine
           cannot be modified or amended without the consent of the Holder of
           each Outstanding Security of such series affected.

      Upon any such waiver, such default shall cease to exist, and any Event of
      Default arising therefrom shall be deemed to have been cured, for every
      purpose of this Indenture; but no such waiver shall extend to any
      subsequent or other default or impair any right consequent thereon.

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<PAGE>

514.  Undertaking for Costs.

      In any suit for the enforcement of any right or remedy under this
      Indenture, or in any suit against the Trustee for any action taken,
      suffered or omitted by it as Trustee, a court may require any party
      litigant in such suit to file an undertaking to pay the costs of such
      suit, and may assess costs against any such party litigant, including
      reasonable attorneys' fees and expenses, in each case in the manner and to
      the extent provided in the Trust Indenture Act; provided, however, that
      neither this Section nor the Trust Indenture Act shall be deemed to
      authorize any court to require such an undertaking or to make such an
      assessment in any suit instituted by the Company or the Parent Guarantor,
      if applicable.

515.  Waiver of Usury, 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 or take the benefit or advantage of, any usury, 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.

                                  THE TRUSTEE

601.  Certain Duties and Responsibilities.

      The duties and responsibilities of the Trustee shall be as provided by the
      Trust Indenture Act. Notwithstanding the foregoing, no provision of this
      Indenture shall require the Trustee to expend or risk its own funds or
      otherwise incur any financial liability in the performance of any of its
      duties hereunder, or in the exercise of any of its rights or powers.
      Whether or not therein expressly so provided, every provision of this
      Indenture relating to the conduct or affecting the liability of or
      affording protection to the Trustee shall be subject to the provisions of
      this Section.

602.  Notice of Defaults.

      If a default occurs hereunder with respect to Securities of any series,
      the Trustee shall give the Holders of Securities of such series notice of
      such default as and to the extent provided by the Trust Indenture Act;
      provided, however, that in the case of any default of the character
      specified in Section 501(4) with respect to Securities of such series, no
      such notice to Holders shall be given until at least 30 days after the
      occurrence thereof. For the purpose of this Section, the term "default"
      means any event which is, or after notice or lapse of time or both would
      become, an Event of Default with respect to Securities of such series.

603.  Certain Rights of Trustee.

      Subject to the provisions of Section 601:

      (1)  the Trustee may conclusively rely and shall be fully protected in
           acting or refraining from acting upon any resolution, certificate,
           statement, instrument, opinion, report, notice, request, direction,
           consent, order, bond, debenture, note, other evidence of indebtedness
           or other paper or document (whether in its original or facsimile
           form) believed by it to be genuine and to have been signed or
           presented by the proper party or parties;

                                       40
<PAGE>

(2)  any request or direction of the Company mentioned herein shall be
     sufficiently evidenced by a Company Request or Company Order, and any
     resolution of the Board of Directors shall be sufficiently evidenced by a
     Board Resolution;

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

(4)  the Trustee may consult with counsel of its own selection and the advice of
     such counsel or any Opinion of Counsel shall be full and complete
     authorization and protection in respect of any action taken, suffered or
     omitted by it hereunder in good faith and in reliance thereon;

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

(6)  the Trustee shall not be bound to make any investigation into the facts or
     matters stated in any resolution, certificate, statement, instrument,
     opinion, report, notice, request, direction, consent, order, bond,
     debenture, note, other evidence of indebtedness or other paper or document,
     but the Trustee, in its discretion, may make such further inquiry or
     investigation into such facts or matters as it may see fit, and, if the
     Trustee shall determine to make such further inquiry or investigation, it
     shall be entitled to examine, personally or by agent or attorney, the
     books, records and premises of the Company during normal business hours on
     a business day with reasonable prior notice at the reasonable expense of
     the Company and shall incur no liability of any kind by reason of such
     inquiry or investigation, unless such liability shall be determined to have
     arisen from its gross negligence, bad faith or willful misconduct, provided
     that the Trustee shall not be entitled to such information which the
     Company is prevented from disclosing as a matter of law or contract;

(7)  the Trustee may execute any of the trusts or powers hereunder or perform
     any duties hereunder either directly or by or through agents or attorneys
     and the Trustee shall not be responsible for any misconduct or negligence
     on the part of any agent or attorney appointed with due care by it
     hereunder;

(8)  the Trustee shall not be liable for any action taken, suffered, or omitted
     to be taken by it in good faith and reasonably believed by it to be
     authorized or within the discretion or rights or powers conferred upon it
     by this Indenture;

(9)  the Trustee shall not be deemed to have notice of any Default or 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 such a
     default is received by the Trustee at the Corporate Trust Office of the
     Trustee, and such notice references the Securities and this Indenture; and

(10) the rights, privileges, protections, immunities and benefits given to the
     Trustee, including, without limitation, its right to be indemnified, are
     extended to, and shall be enforceable by, the Trustee in each of its
     capacities hereunder.

                                       41
<PAGE>

604.  Not Responsible for Recitals or Issuance of Securities.

      The recitals contained herein and in the Securities and the Parent
      Guarantees endorsed thereon, if any, except the Trustee's certificates of
      authentication, shall be taken as the statements of the Company or the
      Parent Guarantor, as the case may be, and neither the Trustee nor any
      Authenticating Agent assumes any responsibility for their correctness. The
      Trustee makes no representations as to the validity or sufficiency of this
      Indenture or of the Securities or of the Parent Guarantees endorsed
      thereon, if any. Neither the Trustee nor any Authenticating Agent shall be
      accountable for the use or application by the Company of Securities or the
      proceeds thereof.

605.  May Hold Securities.

      The Trustee, any Authenticating Agent, any Paying Agent, any Security
      Registrar or any other agent of the Company, in its individual or any
      other capacity, may become the owner or pledgee of Securities and, subject
      to Sections 608 and 613, may otherwise deal with the Company with the same
      rights it would have if it were not Trustee, Authenticating Agent, Paying
      Agent, Security Registrar or such other agent.

606.  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 agreed with the Company or the Parent Guarantor, if
      applicable.

607.  Compensation and Reimbursement.

      Each of the Company and the Parent Guarantor, jointly and severally,
      agrees:

      (1)  to pay to the Trustee as agreed upon in writing from time to time
           reasonable compensation for all services rendered by it hereunder
           (which compensation shall not be limited by any provision of law in
           regard to the compensation of a trustee of an express trust);

      (2)  except as otherwise expressly provided herein, to reimburse the
           Trustee upon its request for all reasonable expenses, disbursements
           and advances incurred or made by the Trustee in accordance with any
           provision of this Indenture (including the reasonable compensation
           and the expenses and disbursements of its agents and counsel), except
           any such expense, disbursement or advance determined to have been
           caused by its own negligence, bad faith or willful misconduct; and

      (3)  to indemnify fully the Trustee (and any predecessor Trustee) for, and
           to hold it harmless against, any and all loss, liability, claim,
           damage or expense (including reasonable attorneys' fees and expenses)
           incurred without negligence, bad faith or willful misconduct on its
           part, arising out of or in connection with the acceptance or
           administration of the trust or trusts hereunder, including the costs
           and expenses of defending itself against any claim or liability in
           connection with the exercise or performance of any of its powers or
           duties hereunder.

608.  Conflicting Interests.

      If the Trustee has or shall acquire a conflicting interest within the
      meaning of the Trust Indenture Act, the Trustee shall either eliminate
      such interest or resign, to the extent and in

                                       42
<PAGE>

      the manner provided by, and subject to the provisions of, the Trust
      Indenture Act and this Indenture. To the extent permitted by such Act, the
      Trustee shall not be deemed to have a conflicting interest by virtue of
      being a trustee under this Indenture with respect to Securities of more
      than one series or a trustee under any existing indentures in effect
      between the Company and the Trustee, if applicable.

609.  Corporate Trustee Required; Eligibility.

      There shall at all times be one (and only one) Trustee hereunder with
      respect to the Securities of each series, which may be Trustee hereunder
      for Securities of one or more other series. Each Trustee shall be a Person
      that is eligible pursuant to the Trust Indenture Act to act as such, has a
      combined capital and surplus of at least $50,000,000 and has its Corporate
      Trust Office in the Borough of Manhattan, the City of New York. If any
      such Person publishes reports of condition at least annually, pursuant to
      law or to the requirements of its supervising or examining authority, then
      for the purposes of this Section and to the extent permitted by the Trust
      Indenture Act, the combined capital and surplus of such Person shall be
      deemed to be its combined capital and surplus as set forth in its most
      recent report of condition so published. If at any time the Trustee with
      respect to the Securities of any series shall cease to be eligible in
      accordance with the provisions of this Section, it shall resign
      immediately in the manner and with the effect hereinafter specified in
      this Article.

610.  Resignation and Removal; Appointment of Successor.

      No resignation or removal of the Trustee and no appointment of a successor
      Trustee pursuant to this Article shall become effective until the
      acceptance of appointment by the successor Trustee in accordance with the
      applicable requirements of Section 611.

      The Trustee may resign at any time with respect to the Securities of one
      or more series by giving written notice thereof to the Company and, if
      applicable, the Parent Guarantor. If the instrument of acceptance by a
      successor Trustee required by Section 611 shall not have been delivered to
      the Trustee within 30 days after the giving of such notice of resignation,
      the resigning Trustee may petition at the expense of the Company any court
      of competent jurisdiction for the appointment of a successor Trustee with
      respect to the Securities of such series.

      The Trustee may be removed at any time with respect to the Securities of
      any series by Act of the Holders of a majority in principal amount of the
      Outstanding Securities of such series, delivered to the Trustee and to the
      Company and, if applicable, the Parent Guarantor. If the instrument of
      acceptance by a successor Trustee required by Section 611 shall not have
      been delivered to the Trustee within 30 days following such removal, the
      Trustee may petition at the expense of the Company any court of competent
      jurisdiction for the appointment of a successor Trustee with respect to
      the Securities of such series.

      If at any time:

      (1)  the Trustee shall fail to comply with Section 608 after written
           request therefor by the Company or by any Holder who has been a bona
           fide Holder of a Security for at least six months, or

      (2)  the Trustee shall cease to be eligible under Section 609 and shall
           fail to resign after written request therefor by the Company or by
           any such Holder, or

      (3)  the Trustee shall become incapable of acting or shall be adjudged a
           bankrupt or

                                       43
<PAGE>

           insolvent or a receiver of the Trustee or of its property shall be
           appointed or any public officer shall take charge or control of the
           Trustee or of its property or affairs for the purpose of
           rehabilitation, conservation or liquidation,

      then, in any such case, (A) the Company by a Board Resolution may remove
      the Trustee with respect to all Securities, or (B) subject to Section 514,
      any Holder who has been a bona fide Holder of a Security for at least six
      months may, on behalf of himself and all others similarly situated,
      petition any court of competent jurisdiction for the removal of the
      Trustee with respect to all Securities and the appointment of a successor
      Trustee or Trustees.

      If the Trustee shall resign, be removed or become incapable of acting, or
      if a vacancy shall occur in the office of Trustee for any cause, with
      respect to the Securities of one or more series, the Company, by a Board
      Resolution, shall promptly appoint a successor Trustee or Trustees with
      respect to the Securities of that or those series (it being understood
      that any such successor Trustee may be appointed with respect to the
      Securities of one or more or all of such series and that at any time there
      shall be only one Trustee with respect to the Securities of any particular
      series) and shall comply with the applicable requirements of Section 611.
      If, within one year after such resignation, removal or incapability, or
      the occurrence of such vacancy, a successor Trustee with respect to the
      Securities of any series shall be appointed by Act of the Holders of a
      majority in principal amount of the Outstanding Securities of such series
      delivered to the Company, the Parent Guarantor, if applicable, and the
      retiring Trustee, the successor Trustee so appointed shall, forthwith upon
      its acceptance of such appointment in accordance with the applicable
      requirements of Section 611, become the successor Trustee with respect to
      the Securities of such series and to that extent supersede the successor
      Trustee appointed by the Company. If no successor Trustee with respect to
      the Securities of any series shall have been so appointed by the Company
      or the Holders and accepted appointment in the manner required by Section
      611, any Holder who has been a bona fide Holder of a Security of such
      series for at least six months may, on behalf of himself and all others
      similarly situated, petition any court of competent jurisdiction for the
      appointment of a successor Trustee with respect to the Securities of such
      series.

      The Company shall give notice of each resignation and each removal of the
      Trustee with respect to the Securities of any series and each appointment
      of a successor Trustee with respect to the Securities of any series to all
      Holders of Securities of such series in the manner provided in Section
      106. Each notice shall include the name of the successor Trustee with
      respect to the Securities of such series and the address of its Corporate
      Trust Office.

611.  Acceptance of Appointment by Successor.

      In case of the appointment hereunder of a successor Trustee with respect
      to all Securities, every such successor Trustee so appointed shall
      execute, acknowledge and deliver to the Company and to the retiring
      Trustee an instrument accepting such appointment, and thereupon the
      resignation or removal of the retiring Trustee shall become effective and
      such successor Trustee, without any further act, deed or conveyance, shall
      become vested with all the rights, powers, trusts and duties of the
      retiring Trustee; but, on the request of the Company or the Parent
      Guarantor, if applicable, or the successor Trustee, such retiring Trustee
      shall, upon payment of its charges, execute and deliver an instrument
      transferring to such successor Trustee all the rights, powers and trusts
      of the retiring Trustee and shall duly assign, transfer and deliver to
      such successor Trustee all property and money held by such retiring
      Trustee hereunder.

      In case of the appointment hereunder of a successor Trustee with respect
      to the Securities of one or more (but not all) series, the Company, the
      Parent Guarantor, if applicable, the retiring

                                       44
<PAGE>

      Trustee and each successor Trustee with respect to the Securities of one
      or more series shall execute and deliver an indenture supplemental hereto
      wherein each successor Trustee shall accept such appointment and which (1)
      shall contain such provisions as shall be necessary or desirable to
      transfer and confirm to, and to vest in, each successor Trustee all the
      rights, powers, trusts and duties of the retiring Trustee with respect to
      the Securities of that or those series to which the appointment of such
      successor Trustee relates, (2) if the retiring Trustee is not retiring
      with respect to all Securities, shall contain such provisions as shall be
      deemed necessary or desirable to confirm that all the rights, powers,
      trusts and duties of the retiring Trustee with respect to the Securities
      of that or those series as to which the retiring Trustee is not retiring
      shall continue to be vested in the retiring Trustee, and (3) shall add to
      or change any of the provisions of this Indenture as shall be necessary to
      provide for or facilitate the administration of the trusts hereunder by
      more than one Trustee, it being understood that nothing herein or in such
      supplemental indenture shall constitute such Trustees co-trustees of the
      same trust and that each such Trustee shall be trustee of a trust or
      trusts hereunder separate and apart from any trust or trusts hereunder
      administered by any other such Trustee; and upon the execution and
      delivery of such supplemental indenture the resignation or removal of the
      retiring Trustee shall become effective to the extent provided therein and
      each such successor Trustee, without any further act, deed or conveyance,
      shall become vested with all the rights, powers, trusts and duties of the
      retiring Trustee with respect to the Securities of that or those series to
      which the appointment of such successor Trustee relates; but, on request
      of the Company or the Parent Guarantor, if applicable, or any successor
      Trustee, such retiring Trustee shall duly assign, transfer and deliver to
      such successor Trustee all property and money held by such retiring
      Trustee hereunder with respect to the Securities of that or those series
      to which the appointment of such successor Trustee relates.

      Upon request of any such successor Trustee, the Company and, if
      applicable, the Parent Guarantor shall execute any and all instruments for
      more fully and certainly vesting in and confirming to such successor
      Trustee all such rights, powers and trusts referred to in the first or
      second preceding paragraph, as the case may be.

      No successor Trustee shall accept its appointment unless at the time of
      such acceptance such successor Trustee shall be qualified and eligible
      under this Article.

612.  Merger, Conversion, Consolidation or Succession to Business.

      Any corporation into which the Trustee may be merged or converted or with
      which it may be consolidated, or any corporation resulting from any
      merger, conversion or consolidation to which the Trustee shall be a party,
      or any corporation succeeding to all or substantially all the corporate
      trust business of the Trustee, shall be the successor of the Trustee
      hereunder, provided that such corporation shall be otherwise qualified and
      eligible under this Article, without the execution or filing of any paper
      or any further act on the part of any of the parties hereto. In the event
      that any Securities shall have been authenticated, but not delivered, by
      the Trustee then in office, any successor by merger, conversion or
      consolidation to such authenticating Trustee may adopt such authentication
      and deliver the Securities so authenticated with the same effect as if
      such successor Trustee had itself authenticated such Securities.

613.  Preferential Collection of Claims Against Company.

      If and when the Trustee shall be or become a creditor of the Company, the
      Parent Guarantor, if applicable, or any other obligor upon the Securities,
      the Trustee shall be subject to the provisions of the Trust Indenture Act
      regarding the collection of claims against the Company, the Parent
      Guarantor, if applicable, or any such other obligor.

                                       45
<PAGE>

614.  Appointment of Authenticating Agent.

      The Trustee may appoint an Authenticating Agent or Agents with respect to
      one or more series of Securities which shall be authorized to act on
      behalf of the Trustee to authenticate Securities of such series issued
      upon original issue and upon exchange, registration of transfer or partial
      redemption thereof or pursuant to Section 306, and Securities so
      authenticated shall be entitled to the benefits of this Indenture and
      shall be valid and obligatory for all purposes as if authenticated by the
      Trustee hereunder. Wherever reference is made in this Indenture to the
      authentication and delivery of Securities by the Trustee or the Trustee's
      certificate of authentication, such reference shall be deemed to include
      authentication and delivery on behalf of the Trustee by an Authenticating
      Agent and a certificate of authentication executed on behalf of the
      Trustee by an Authenticating Agent. Each Authenticating Agent shall be
      acceptable to the Company and shall at all times be a corporation
      organized and doing business under the laws of the United States of
      America, any State thereof or the District of Columbia, authorized under
      such laws to act as Authenticating Agent, having a combined capital and
      surplus of not less than $50,000,000 and subject to supervision or
      examination by Federal or State authority. If such Authenticating Agent
      publishes reports of condition at least annually, pursuant to law or to
      the requirements of said supervising or examining authority, then for the
      purposes of this Section, the combined capital and surplus of such
      Authenticating Agent shall be deemed to be its combined capital and
      surplus as set forth in its most recent report of condition so published.
      If at any time an Authenticating Agent shall cease to be eligible in
      accordance with the provisions of this Section, such Authenticating Agent
      shall resign immediately in the manner and with the effect specified in
      this Section.

      Any corporation into which an Authenticating Agent may be merged or
      converted or with which it may be consolidated, or any corporation
      resulting from any merger, conversion or consolidation to which such
      Authenticating Agent shall be a party, or any corporation succeeding to
      the corporate agency or corporate trust business of an Authenticating
      Agent, shall continue to be an Authenticating Agent, provided that such
      corporation shall be otherwise eligible under this Section, without the
      execution or filing of any paper or any further act on the part of the
      Trustee or the Authenticating Agent.

      An Authenticating Agent may resign at any time by giving written notice
      thereof to the Trustee and to the Company and the Parent Guarantor, if
      applicable. The Trustee may at any time terminate the agency of an
      Authenticating Agent by giving written notice thereof to such
      Authenticating Agent and to the Company and the Parent Guarantor, if
      applicable. Upon receiving such a notice of resignation or upon such a
      termination, or in the event that such Authenticating Agent shall cease to
      be eligible in accordance with the provisions of this Section at any time,
      the Trustee may appoint a successor Authenticating Agent which shall be
      acceptable to the Company and shall give notice of such appointment in the
      manner provided in Section 106 to all Holders of Securities of the series
      with respect to which such Authenticating Agent will serve. Any successor
      Authenticating Agent, upon acceptance of its appointment hereunder, shall
      become vested with all the rights, powers and duties of its predecessor
      hereunder, with like effect as if originally named as an Authenticating
      Agent. No successor Authenticating Agent shall be appointed unless
      eligible under the provisions of this Section.

      The Trustee agrees to pay to each Authenticating Agent from time to time
      reasonable compensation for its services under this Section, and the
      Trustee shall be entitled to be reimbursed for such payments, subject to
      the provisions of Section 607.

                                       46
<PAGE>

      If an appointment with respect to one or more series is made pursuant to
      this Section, the Securities of such series may have endorsed thereon, in
      addition to the Trustee's certificate of authentication, an alternative
      certificate of authentication in the following form:

      This is one of the Securities of the series designated therein referred to
      in the within mentioned Indenture.

,,........................................,
As Trustee

By......................................,
As Authenticating Agent

By........................................
Authorized Officer

               HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY

701.  Company to Furnish Trustee Names and Addresses of Holders.

      The Company will furnish or cause to be furnished to the Trustee

      (1)  semi-annually, not later than January 15 and July 15 in each year, a
           list, in such form as the Trustee may reasonably require, of the
           names and addresses of the Holders of Securities of each series as of
           the preceding January 15 or July 15, as the case may be; and

      (2)  at such other times as the Trustee may request in writing, within 30
           days after the receipt by the Company of any such request, a list of
           similar form and content as of a date not more than 15 days prior to
           the time such list is furnished;

      excluding from any such list names and addresses received by the Trustee
      in its capacity as Security Registrar.

702.  Preservation of Information; Communications to Holders.

      The Trustee shall preserve, in as current a form as is reasonably
      practicable, the names and addresses of Holders contained in the most
      recent list furnished to the Trustee as provided in Section 701 and the
      names and addresses of Holders received by the Trustee in its capacity as
      Security Registrar. The Trustee may destroy any list furnished to it as
      provided in Section 701 upon receipt of a new list so furnished.

      The rights of Holders to communicate with other Holders with respect to
      their rights under this Indenture or under the Securities, and the
      corresponding rights and privileges of the Trustee, shall be as provided
      by the Trust Indenture Act.

                                       47
<PAGE>

      Every Holder of Securities, by receiving and holding the same, agrees with
      the Company, the Parent Guarantor, if applicable, and the Trustee that
      neither the Company, the Parent Guarantor, if applicable, nor the Trustee
      nor any agent of any of them shall be held accountable by reason of any
      disclosure of information as to names and addresses of Holders made
      pursuant to the Trust Indenture Act.

703.  Reports by Trustee.

      The Trustee shall transmit to Holders such reports concerning the Trustee
      and its actions under this Indenture as may be required pursuant to the
      Trust Indenture Act at the times and in the manner provided pursuant
      thereto.

      Reports so required to be transmitted at stated intervals of not more than
      12 months shall be transmitted no later than June 15 in each calendar year
      following the date hereof, so long as any Securities are Outstanding
      hereunder, and shall be dated as of a date convenient to the Trustee no
      more than 60 nor less than 45 days prior thereto.

      A copy of each such report shall, at the time of such transmission to
      Holders, be filed by the Trustee with each stock exchange upon which any
      Securities are listed, with the Commission, with the Company and, if
      applicable, the Parent Guarantor. The Company will notify the Trustee when
      any Securities are listed on any stock exchange or delisted therefrom.

704.  Reports by Company.

      The Company and, if applicable, the Parent Guarantor shall file with the
      Trustee and the Commission, and transmit to Holders, such information,
      documents and other reports, and such summaries thereof, if any, as may be
      required pursuant to the Trust Indenture Act at the times and in the
      manner provided pursuant to such Act; provided that any such information,
      documents or reports required to be filed with the Commission pursuant to
      Section 13 or 15(d) of the Exchange Act shall be filed with the Trustee
      within 15 days after the same is so required to be filed with the
      Commission. 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).

             CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

801.  Company or, if Applicable, Parent Guarantor May Consolidate, Etc., Only on
      Certain Terms.

      Each of the Parent Guarantor, if applicable, and 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)  if applicable, in case the Parent Guarantor shall consolidate with or
           merge into another Person or convey, transfer or lease its properties
           and assets substantially as an entirety to any Person, the Person
           formed by such consolidation or into which the Parent Guarantor is
           merged or the Person which acquires by conveyance or transfer, or
           which leases, the properties and assets of the Parent Guarantor
           substantially as an entirety (for purposes of this Article Eight, a
           "Successor Parent") shall expressly assume, by an indenture
           supplemental hereto executed and delivered to the Trustee, in

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<PAGE>

           form reasonably satisfactory to the Trustee, the Parent Guarantor's
           obligations under this Indenture and the performance or observance of
           every covenant of this Indenture on the part of the Parent Guarantor
           to be performed or observed; and

      (2)  in case the Company shall consolidate with or merge into another
           Person or convey, transfer or lease its properties and assets
           substantially as an entirety to any Person, 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 (for purposes
           of this Article Eight, a "Successor Company") shall (a) 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 any premium and
           interest on all the Securities and the performance or observance of
           every covenant of this Indenture on the part of the Company to be
           performed or observed and (b) if any such Person is incorporated
           under the laws of any jurisdiction other than The Netherlands, agree
           to pay any Additional Amounts with respect to the Securities; and

      (3)  immediately after giving effect to such transaction and treating any
           indebtedness which becomes an obligation of the Company, or, if
           applicable, the Parent Guarantor or any Subsidiary as a result of
           such transaction as having been incurred by the Company or such
           Subsidiary at the time 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.

802.  Successor Substituted.

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

                            SUPPLEMENTAL INDENTURES

901.  Supplemental Indentures Without Consent of Holders.

      Without the consent of any Holders, the Company and the Parent Guarantor,
      when authorized by respective Board Resolutions, and the Trustee, at any
      time and from time to time, may enter into one or more indentures
      supplemental hereto, in form satisfactory to the Trustee, for any of the
      following purposes:

      (1)  to evidence the succession of another Person to the Company and the
           assumption by any such successor of the covenants of the Company
           herein and in the Securities; or

      (2)  to evidence the succession of another Person to the Parent Guarantor,
           if applicable, and the assumption by any such successor of the
           covenants of the Parent Guarantor herein and in the Parent
           Guarantees; or

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<PAGE>

      (3)  to add to the covenants of the Company or the Parent Guarantor, if
           applicable, for the benefit of the Holders of all or any series of
           Securities (and if such covenants are to be for the benefit of less
           than all series of Securities, stating that such covenants are
           expressly being included solely for the benefit of such series) or to
           surrender any right or power herein conferred upon the Company or the
           Parent Guarantor; or

      (4)  to add any additional Events of Default for the benefit of the
           Holders of all or any series of Securities (and if such additional
           Events of Default are to be for the benefit of less than all series
           of Securities, stating that such additional Events of Default are
           expressly being included solely for the benefit of such series); or

      (5)  to add to or change any of the provisions of this Indenture to such
           extent as shall be necessary to permit or facilitate the issuance of
           Securities in bearer form, registrable or not registrable as to
           principal, and with or without interest coupons, or to permit or
           facilitate the issuance of Securities in uncertificated form; or

      (6)  to add to, change or eliminate any of the provisions of this
           Indenture in respect of one or more series of Securities, provided
           that any such addition, change or elimination (A) shall neither (i)
           apply to any Security of any series created prior to the execution of
           such supplemental indenture and entitled to the benefit of such
           provision nor (ii) modify the rights of the Holder of any such
           Security with respect to such provision or (B) shall become effective
           only when there is no such Security Outstanding; or

      (7)  to establish the form or terms of Securities of any series as
           permitted by Sections 201 and 301; or

      (8)  to evidence and provide for the acceptance of appointment hereunder
           by a successor Trustee with respect to the Securities of one or more
           series and to add to or change any of the provisions of this
           Indenture as shall be necessary to provide for or facilitate the
           administration of the trusts hereunder by more than one Trustee,
           pursuant to the requirements of Section 611; or

      (9)  to cure any ambiguity, to correct or supplement any provision herein
           which may be defective or inconsistent with any other provision
           herein, or to make any other provisions with respect to matters or
           questions arising under this Indenture or any supplemental Indenture,
           provided that such action pursuant to this Clause (9) shall not
           adversely affect the interests of the Holders of Securities of any
           series in any material respect.

902.  Supplemental Indentures With Consent of Holders.

      With the consent of the Holders of not less than a majority in principal
      amount of the Outstanding Securities of each series affected by such
      supplemental indenture, by Act of said Holders delivered to the Company,
      the Parent Guarantor, if applicable, and the Trustee, the Company and, if
      applicable, the Parent Guarantor, when authorized by respective Board
      Resolutions, and the Trustee may enter into an indenture or indentures
      supplemental hereto for the purpose of adding any provisions to or
      changing in any manner or eliminating any of the provisions of this
      Indenture or of modifying in any manner the rights of the Holders of
      Securities of such series under this Indenture; provided, however, that no
      such supplemental indenture shall, without the consent of the Holder of
      each Outstanding Security affected thereby,

      (1)  change the Stated Maturity of the principal of, or any installment of
           principal of or

                                       50
<PAGE>

           interest on, any Security, or reduce the principal amount thereof or
           the rate of interest thereon or any premium payable upon the
           redemption thereof, or reduce the amount of the principal of an
           Original Issue Discount Security or any other Security which would be
           due and payable upon a declaration of acceleration of the Maturity
           thereof pursuant to Section 502, or change any Place of Payment
           where, or the coin or currency in which, any Security or any premium
           or interest thereon is payable, or impair the right to institute suit
           for the enforcement of any such payment on or after the Stated
           Maturity thereof (or, in the case of redemption, on or after the
           Redemption Date), or modify the provisions of this Indenture with
           respect to the subordination of the Securities in a manner adverse to
           the Holder, or

      (2)  reduce the percentage in principal amount of the Outstanding
           Securities of any series, the consent of whose Holders is required
           for any such supplemental indenture, or the consent of whose Holders
           is required for any waiver (of compliance with certain provisions of
           this Indenture or certain defaults hereunder and their consequences)
           provided for in this Indenture, or

      (3)  modify any of the provisions of this Section, Section 513 or Section
           1007, except to increase any such percentage or to provide that
           certain other provisions of this Indenture cannot be modified or
           waived without the consent of the Holder of each Outstanding Security
           affected thereby; provided, however, that this clause shall not be
           deemed to require the consent of any Holder with respect to changes
           in the references to "the Trustee" and concomitant changes in this
           Section and Section 1007, or the deletion of this proviso, in
           accordance with the requirements of Sections 611 and 901(6).

      A supplemental indenture which changes or eliminates any covenant or other
      provision of this Indenture which has expressly been included solely for
      the benefit of one or more particular series of Securities, or which
      modifies the rights of the Holders of Securities of such series with
      respect to such covenant or other provision, shall be deemed not to affect
      the rights under this Indenture of the Holders of Securities of any other
      series.

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

903.  Execution of Supplemental Indentures.

      In executing, or accepting the additional trusts created by, any
      supplemental indenture permitted by this Article or the modifications
      thereby of the trusts created by this Indenture, the Trustee may receive,
      and (subject to Section 601) shall be fully protected in relying upon, an
      Opinion of Counsel stating that the execution of such supplemental
      indenture is authorized or permitted by this Indenture. The Trustee may,
      but shall not be obligated to, enter into any such supplemental indenture
      which affects the Trustee's own rights, duties or immunities under this
      Indenture or otherwise.

904.  Effect of Supplemental Indentures.

      Upon the execution of any supplemental indenture under this Article, this
      Indenture shall be modified in accordance therewith, and such supplemental
      indenture shall form a part of this Indenture for all purposes; and every
      Holder of Securities theretofore or thereafter authenticated and delivered
      hereunder shall be bound thereby.

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<PAGE>

905.   Conformity with Trust Indenture Act.

       Every supplemental indenture executed pursuant to this Article shall
       conform to the requirements of the Trust Indenture Act.

906.   Reference in Securities to Supplemental Indentures.

       Securities of any series authenticated and delivered after the execution
       of any supplemental indenture pursuant to this Article may, and shall if
       required by the Trustee, bear a notation in form approved by the Trustee
       as to any matter provided for in such supplemental indenture. If the
       Company and the Parent Guarantor, if applicable, shall so determine, new
       Securities and the Parent Guarantees, if applicable, endorsed thereon of
       any series so modified as to conform, in the opinion of the Trustee and
       the Company, to any such supplemental indenture may be prepared and
       executed by the Company and authenticated and delivered by the Trustee in
       exchange for Outstanding Securities of such series.

                                   COVENANTS

1001.  Payment of Principal, Premium and Interest.

       The Company covenants and agrees for the benefit of each series of
       Securities that it will duly and punctually pay the principal of and any
       premium and interest on the Securities of that series in accordance with
       the terms of the Securities and this Indenture.

1002.  Maintenance of Office or Agency.

       So long as the Securities remain Outstanding, the Company will maintain
       in each Place of Payment for any series of Securities an office or agency
       where Securities of that series may be presented or surrendered for
       payment, where Securities of that series may be surrendered for
       registration of transfer or exchange, where Convertible Securities may be
       presented for conversion into shares, if applicable (hereinafter the
       "Conversion Agent", which term shall include any additional Conversion
       Agents as may be appointed by the Company), and where notices and demands
       to or upon the Company and the Parent Guarantor in respect of the
       Securities of that series, and any Parent Guarantee, if applicable,
       endorsed on the Securities and this Indenture may be served. The Company
       will give written notice to the Trustee of the location, and any change
       in the location, of such office or agency. If at any time the Company
       shall fail to maintain any such required office or agency or shall fail
       to furnish the Trustee with the address thereof, such presentations,
       surrenders, notices and demands may be made or served at the Corporate
       Trust Office of the Trustee.

       The Company may also from time to time designate one or more other
       offices or agencies where the Securities of one or more series may be
       presented or surrendered for any or all such purposes and may from time
       to time rescind such designations; provided, however, that no such
       designation or rescission shall relieve the Company or, if applicable,
       the Parent Guarantor of its obligation to maintain an office or agency in
       each Place of Payment for Securities of any series for such purposes. The
       Company or the Parent Guarantor, as the case may be, will give written
       notice to the Trustee of any such designation or rescission and of any
       change in the location of any such other office or agency.

1003.  Money for Securities Payments to Be Held in Trust; Paying Agent.

       If the Company shall at any time act as its own Paying Agent with respect
       to any series of Securities, it will, on or before each due date of the
       principal of or any premium or interest on any of the Securities of that
       series, segregate and hold in trust for the benefit of the Persons

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<PAGE>

       entitled thereto a sum sufficient to pay the principal and any premium
       and interest so becoming due until such sums shall be paid to such
       Persons or otherwise disposed of as herein provided and will promptly
       notify the Trustee of its action or failure so to act.

       Whenever the Company shall have one or more Paying Agents for any series
       of Securities, it will, prior to each due date of the principal of or any
       premium or interest on any Securities of that series, deposit with a
       Paying Agent a sum sufficient to pay such amount, such sum to be held as
       provided by the Trust Indenture Act, and (unless such Paying Agent is the
       Trustee) the Company will promptly notify the Trustee of its action or
       failure so to act.

       The Company will cause each Paying Agent for any series of Securities
       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) comply with the provisions of the Trust Indenture Act applicable to
       it as a Paying Agent and (2) during the continuance of any default by the
       Company (or any other obligor upon the Securities of that series) in the
       making of any payment in respect of the Securities of that series, upon
       the written request of the Trustee, forthwith pay to the Trustee all sums
       held in trust by such Paying Agent for payment in respect of the
       Securities of that series.

       The Company may at any time, for the purpose of obtaining the
       satisfaction and discharge of this Indenture or for any other purpose,
       pay, or by Company Order direct any Paying Agent to pay, to the Trustee
       all sums held in trust by the Company or such Paying Agent, such sums to
       be held by the Trustee upon the same trusts as those upon which such sums
       were held by the Company or such Paying Agent; and, upon such payment by
       the Company or any Paying Agent to the Trustee, the Company or such
       Paying Agent shall be released from all further liability with respect to
       such money.

       Any money deposited with the Trustee or any Paying Agent, or then held by
       the Company, in trust for the payment of the principal of or any premium
       or interest on any Security of any series and remaining unclaimed for two
       years after such principal, premium or interest has become due and
       payable shall be paid to the Company on Company Request, or (if then held
       by the Company) shall be discharged from such trust; and the Holder of
       such Security shall thereafter, as an unsecured general creditor, look
       only to the Company for payment thereof, and all liability of the Trustee
       or such Paying Agent with respect to such trust money, and all liability
       of the Company as trustee thereof, shall thereupon cease.

1004.  Statement by Officers as to Default.

       The Company will deliver to the Trustee, within 120 days after the end of
       each fiscal year of the Company ending after the date hereof, an
       Officers' Certificate, stating whether or not to the best knowledge of
       the signers thereof the Company is in default in the performance and
       observance of any of the terms, provisions and conditions of this Article
       and whether an Event of Default has occurred and, if the Company shall be
       in default, specifying all such defaults and the nature and status
       thereof of which they may have knowledge. The Company shall deliver to
       the Trustee, as soon as possible and in any event within 10 business 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 Officer's Certificate setting forth
       details of such Event of Default or default and actions which the Company
       proposes to take with respect thereto.

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<PAGE>

1005.  Existence.

       Subject to Article Eight, each of the Company and, if applicable, the
       Parent Guarantor will do or cause to be done all things necessary to
       preserve and keep in full force and effect its and their corporate
       existence.

1006.  Payments of Additional Amounts.

       All payments in respect of the Securities, including without limitation,
       payments of principal interest, if any, and premium, if any, shall be
       made by the Company, or by the Parent Guarantor, if applicable, without
       withholding or deduction for or on account of any present or future
       taxes, duties, levies, or other governmental charges of whatever nature
       in effect on the date of the Indenture or imposed or established in the
       future by or on behalf of The Netherlands or the United States or any
       authority thereof (respectively, a "Netherlands Tax" and an "United
       States Tax"). In the event any such Netherlands Tax and United States Tax
       is so imposed or established, the Company or the Parent Guarantor shall
       pay such additional amounts ("Additional Amounts") as may be necessary in
       order that the net amounts receivable by each Holder after any payment,
       withholding or deduction in respect of such Netherlands Tax and United
       States Tax shall equal the respective amounts of principal, interest if
       any, and premium, if any, which would have been receivable in respect of
       the Security in the absence of such payment, withholding or deduction;
       provided, however, that (a) the amounts with respect to the Netherlands
       Tax shall be payable only to Holders that are not residents in The
       Netherlands for purposes of its tax; and (b) amount with respect to
       United States Tax shall be payable only to a Holder that is, for United
       States tax purposes, a nonresident alien individual, a foreign
       corporation, or an estate or trust not subject to tax on a net income
       basis with respect to income on the Securities (a "United States Alien");
       and provided further, that the issuer or guarantor shall not be required
       to make any payment of Additional Amounts for or account of:

       (1)  any tax, assessment or other governmental charge which would not
            have been imposed but for the existence of any present or former
            connection between such Holder (or between a fiduciary, settlor,
            beneficiary, member or shareholder of, or possessor of a power over
            such Holder, if such Holder is an estate, trust, partnership or
            corporation) and The Netherlands or the United States (in the case
            of a Netherlands Tax or a United States Tax, respectively), or any
            political subdivision or territory or possession thereof or therein
            or area subject to its jurisdiction, including, without limitation,
            such Holder (or such fiduciary, settlor, beneficiary, member,
            shareholder or possessor) being or having been a citizen or resident
            thereof or treated as a resident thereof or being or having been
            present or engaged in trade or business therein or having or having
            had a permanent establishment therein;

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

       (3)  any tax, assessment or other governmental charge which is payable
            other than by withholding from payments of (or in respect of)
            principal of or any premium or interest on the Securities;

       (4)  with respect to any United States Tax, any such tax imposed by
            reason of the Holder's past or present status as a personal holding
            company, foreign personal holding company or foreign private
            foundation or similar tax-exempt organization with respect to the
            United States or as a corporation which accumulates earnings to
            avoid United States Federal income tax;

                                       54
<PAGE>

       (5)  with respect to any United States Tax, any such Tax imposed by
            reason of such Holder's past or present status as (i) the actual or
            constructive owner of 10% or more of the total combined voting power
            of all classes of stock of AEGON Funding or AEGON Funding II or (ii)
            a controlled foreign corporation that is related to AEGON Funding or
            AEGON Funding II through stock ownership;

       (6)  any tax, assessment or other governmental charge required to be
            withheld by any Paying Agent from any payment of principal of,
            premium, if any, or any interest on, any Security, if such payment
            can be made without such withholding by any other paying agent;

       (7)  any tax, assessment or other governmental charge which would not
            have been imposed or withheld if such Holder had made a declaration
            of nonresidence or other similar claim for exemption or presented
            any applicable form of certificate, upon the making or presentation
            of which that Holder would either have been able to avoid such tax,
            assessment or charge or to obtain a refund of such tax, assessment
            or charge, including, with respect to any United States Tax,
            certification or documentation to the effect that such Holder or
            beneficial owner is a United States Alien and lacks other
            connections with the United States;

       (8)  any tax, assessment or other governmental charge which would not
            have been imposed but for the presentation of a Security (where
            presentations is required) for payment on the date more than 30 days
            after the date on which such payment became due and payable or the
            date on which payment thereof was duly provided for, whichever
            occurred later; or

       (9)  any combination of items above;

       nor shall Additional Amounts be paid with respect to any payment of the
       principal of, premium, if any, or any interest on any Security to any
       such Holder who is a fiduciary or a partnership or a beneficial owner who
       is other than the sole beneficial owner of such payment to the extent a
       beneficiary or settlor with respect to such fiduciary or a member of such
       partnership or a beneficial owner would not have been entitled to such
       Additional Amount had it been the Holder of the Security.

       Whenever in this Security or in the Indenture there is a reference, in
       any context, to the payment of the principal of interest, if any, on, or
       in respect of, any Security, such payment shall be deemed to include the
       payment of Additional Amounts to the extent that, in such context,
       Additional Amounts are, were or would be payable in respect of such
       payment pursuant to the provisions hereof or thereof and express mention
       of the payment of Additional Amounts (if applicable) in any provision
       hereof shall not be construed as excluding Additional Amounts in those
       provisions hereof where such express mention is not made.

1007.  Waiver of Certain Covenants.

       Except as otherwise specified as contemplated by Section 301 for
       Securities of such series, the Company may, with respect to the
       Securities of any series, omit in any particular instance to comply with
       any term, provision or condition set forth in any covenant provided
       pursuant to Section 301(20), 901(3) or 901(7) for the benefit of the
       Holders of such series or in any of Sections 1001 to 1006, inclusive, if
       before the time for such compliance the Holders of at least a majority in
       principal amount of the Outstanding Securities of such series shall, by
       Act of such Holders, either waive such compliance in such instance or
       generally waive compliance with such term, provision or condition, but no
       such waiver shall extend to or affect such term, provision or condition
       except to the extent so expressly waived, and, until

                                       55
<PAGE>

       such waiver shall become effective, the obligations of the Company and
       the duties of the Trustee in respect of any such term, provision or
       condition shall remain in full force and effect.

1008.  Calculation of Original Issue Discount.

       Upon the written request of the Trustee, the Company shall provide to the
       Trustee on a timely basis such information as the Trustee reasonably
       requires to enable the Trustee to prepare and file any form required to
       be submitted by the Company to the Internal Revenue Service and the
       Holders of the Securities relating to original issue discount.

1009.  Limitation on Liens

       The provisions of this Section shall be applicable only to the Securities
       of any series that is designated, as contemplated by Section 301, as a
       series for the benefit of which this Section shall apply.

       So long as any of the Securities to which this Section applies remain
       Outstanding, no Indebtedness in respect of borrowed moneys having an
       original maturity of more than two years, in each case now or hereafter
       existing, shall be secured by the Company or its Subsidiaries or by the
       Parent Guarantor or its Subsidiaries, if applicable, upon any of the
       present or future assets or revenues of the Company or any of its
       Subsidiaries or the Parent Guarantor or any of its Subsidiaries, if
       applicable, unless it shall, simultaneously with or prior to the creation
       of such security, effectively provide that the same or equal and ratable
       security (or other security acceptable to the Trustee) is accorded to all
       such Securities for so long as such Indebtedness is so secured, except
       that the foregoing shall not apply to (i) security created over any
       shares in, assets of or securities owned by any Subsidiaries that are not
       principally engaged in the business of life insurance and that do not
       contribute more than 10% of AEGON N.V.'s total aggregate consolidated
       gross premium income as indicated on AEGON N.V.'s most recent annual
       audited consolidated income statement, (ii) security created in the
       normal course of the insurance business carried on in a manner consistent
       with generally accepted insurance practice for such insurance business,
       (iii) security or preference arising by operation of any law, (iv)
       security over real property to secure borrowings to finance the purchase
       or improvement of such real property, (v) security over assets existing
       at the time of acquisition thereof, and (vi) security not otherwise
       permitted by the foregoing clauses securing borrowed money in an
       aggregate principal amount not exceeding 50% of AEGON N.V.'s total
       aggregate consolidated Indebtedness with an original maturity of more
       than two years.

                           REDEMPTION OF SECURITIES

1101.  Applicability of Article.

       Securities of any series that are redeemable before their Stated Maturity
       shall be redeemable in accordance with their terms and (except as
       otherwise specified as contemplated by Section 301 for such Securities)
       in accordance with this Article.

1102.  Election to Redeem; Notice to Trustee.

       The election of the Company to redeem any Securities shall be evidenced
       by a Board Resolution or Company Order or in another manner specified as
       contemplated by Section 301 for such Securities. In case of any
       redemption at the election of the Company of less than all the Securities
       of any series (including any such redemption affecting only a single
       Security),

                                       56
<PAGE>

       the Company shall, not more than 60 nor less than 30 days prior to the
       Redemption Date fixed by the Company (unless a shorter notice shall be
       satisfactory to the Trustee), notify the Trustee of such Redemption Date,
       of the principal amount of Securities of such series to be redeemed and,
       if applicable, of the tenor of the Securities to be redeemed. In the case
       of any redemption of Securities prior to the expiration of any
       restriction on such redemption provided in the terms of such Securities
       or elsewhere in this Indenture, the Company shall furnish the Trustee
       with an Officers' Certificate evidencing compliance with such
       restriction.

1103.  Selection by Trustee of Securities to Be Redeemed.

       If less than all the Securities of any series are to be redeemed (unless
       all the Securities of such series and of a specified tenor are to be
       redeemed or unless such redemption affects only a single Security), the
       particular Securities to be redeemed shall be selected not more than 60
       nor less than 30 days prior to the Redemption Date by the Trustee, from
       the Outstanding Securities of such series not previously called for
       redemption, by such method as the Trustee shall deem appropriate and
       which may provide for the selection for redemption of a portion of the
       principal amount of any Security of such series, provided that the
       unredeemed portion of the principal amount of any Security shall be in an
       authorized denomination (which shall not be less than the minimum
       authorized denomination) for such Security. If less than all the
       Securities of such series and of a specified tenor are to be redeemed
       (unless such redemption affects only a single Security), the particular
       Securities to be redeemed shall be selected not more than 60 nor less
       than 30 days prior to the Redemption Date by the Trustee, from the
       Outstanding Securities of such series and specified tenor not previously
       called for redemption in accordance with the preceding sentence.

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

       The provisions of the two preceding paragraphs shall not apply with
       respect to any redemption affecting only a single Security, whether such
       Security is to be redeemed in whole or in part. In the case of any such
       redemption in part, the unredeemed portion of the principal amount of the
       Security shall be in an authorized denomination (which shall not be less
       than the minimum authorized denomination) for such Security.

       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.

1104.  Notice of Redemption.

       Notice of redemption shall be given by first-class mail, postage prepaid,
       mailed not less than 15 nor more than 60 days prior to the Redemption
       Date, to each Holder of Securities to be redeemed, at his last address
       appearing in the Security Register. Any notice which is mailed in the
       manner provided herein shall be conclusively presumed to have been duly
       given, whether or not the Holder receives such notice. Failure to give
       notice by mail, or any defect in the notice to the Holder of any security
       of a series designated for redemption as a whole or in part shall not
       affect the validity of the proceedings for the redemption of any other
       security of such series.

       All notices of redemption shall state:

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       (1)  the Redemption Date,

       (2)  the Redemption Price and premium, if any,

       (3)  if less than all the Outstanding Securities of any series consisting
            of more than a single Security are to be redeemed, the
            identification (and, in the case of partial redemption of any such
            Securities, the principal amounts) of the particular Securities to
            be redeemed and, if less than all the Outstanding Securities of any
            series consisting of a single Security are to be redeemed, the
            principal amount of the particular Security to be redeemed,

       (4)  that on the Redemption Date the Redemption Price will become due and
            payable upon each such Security to be redeemed and, if applicable,
            that interest thereon will cease to accrue on and after said date,

       (5)  the place or places where each such Security is to be surrendered
            for payment of the Redemption Price,

       (6)  if the Securities of such series are Convertible Securities
            convertible at the option of the Holder into Common Shares, the
            Conversion Price, the place or places of conversion, whether or not
            AEGON N.V. may elect to exercise its Cash Option, if applicable,
            that, unless otherwise provided pursuant to Section 301 for
            Convertible Securities of such series, Convertible Securities called
            for redemption may be converted at any time before the close of
            business on the fifth Business Day prior to the Redemption Date and
            if not converted prior to the close of business on such date, the
            right of conversion will be lost and that Holders who want to
            convert Convertible Securities must satisfy the requirements set
            forth in the terms thereof,

       (7)  that the redemption is for a sinking fund, if such is the case, and

       (8)  applicable CUSIP numbers.

       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 request, by
       the Trustee in the name and at the expense of the Company and shall be
       irrevocable.

1105.  Deposit of Redemption Price.

       Prior to any Redemption Date, the Company shall deposit with the Trustee
       or with a Paying Agent (or, if the Company is acting as its own Paying
       Agent, segregate and hold in trust as provided in Section 1003) an amount
       of money sufficient to pay the Redemption Price of and (except if the
       Redemption Date shall be an Interest Payment Date) accrued interest on,
       all the Securities which are to be redeemed on that date.

1106.  Securities Payable on Redemption Date.

       Notice of redemption having been given as aforesaid, the Securities so to
       be redeemed shall, on the Redemption Date, become due and payable at the
       Redemption Price therein specified, and from and after such date such
       Securities shall cease to bear interest. Upon surrender of any such
       Security for redemption in accordance with said notice, such Security
       shall be paid by the Company at the Redemption Price, together with
       accrued interest to the Redemption Date; provided, however, that, unless
       otherwise specified as contemplated by Section 301, installments of
       interest whose Stated Maturity is on or prior to the Redemption Date will
       be payable to the Holders of such Securities, or one or more Predecessor
       Securities, registered as

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       such at the close of business on the relevant Record Dates according to
       their terms and the provisions of Section 307.

       If any Security called for redemption shall not be so paid upon surrender
       thereof for redemption, the principal and any premium shall, until paid,
       bear interest from the Redemption Date at the rate and in the manner
       prescribed therefor in the Security.

1107.  Securities Redeemed in Part.

       Any Security which is to be redeemed only in part shall be surrendered at
       a Place of Payment therefor (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 deliver to the
       Holder of such Security without service charge, a new Security or
       Securities of the same series and of like tenor, 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.

1108.  Conversion Arrangement on Call for Redemption.

       If in connection with any redemption of Securities of any series with
       respect to which the Holders have the right to convert such Securities
       into Common Shares, the Holders thereof do not elect to convert such
       Securities, the Company may arrange for the purchase and conversion of
       such Securities by an agreement with one or more investment banking firms
       or other purchasers to purchase such Securities by paying to the Trustee
       in trust for the Holders, not later than the close of three Business Days
       prior to the Redemption Date, an amount not less than the applicable
       Redemption Price, together with interest accrued to the Redemption Date,
       of such Securities. Notwithstanding anything to the contrary contained in
       this Article Eleven, the obligation of the Company to pay the Redemption
       Price of such Securities, together with interest accrued to the
       Redemption Date, shall be deemed to be satisfied and discharged to the
       extent such amount is so paid by such purchasers to the Trustee in trust
       for the Holders. If such an agreement is made, any Securities not duly
       surrendered for conversion by the Holders thereof may, at the option of
       the Company, be deemed to the fullest extent permitted by law, to have
       been acquired by such purchasers from such Holders and (notwithstanding
       anything to the contrary contained in Article Fifteen) surrendered by
       such purchasers for conversion, all as of immediately prior to the close
       of business on the Redemption Date, subject to payment by the purchasers
       as specified above. The Trustee shall hold and dispose of any such amount
       paid to it in the same manner as it would moneys deposited with it by the
       Company for the redemption of the Securities. Without the Trustee's prior
       written consent, no arrangement between the Company and such purchasers
       for the purchase and conversion of any Securities shall increase or
       otherwise affect any of the powers, duties, responsibilities or
       obligations of the Trustee as set forth in this Indenture.

1109.  Redemption for Tax Reasons.

       If at any time subsequent to the issuance of Securities of any series as
       a result of any change in, or amendment to, the laws or regulations or
       rulings of The Netherlands or the United States or any other nation or
       government or of any political subdivision thereof or any authority
       therein or thereof having power to tax or as a result of any regulations
       or rulings or any amendment to or change in the application or official
       interpretation of such laws, regulations or rulings, the Company, or the
       Parent Guarantor, as the case may be, becomes, or will become, obligated
       to pay any Additional Amounts and such obligations cannot be avoided by
       the Company or, if applicable, the Parent Guarantor taking reasonable
       measures

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       available to it, the Securities of any such series shall be redeemable as
       a whole (but not in part), at the option of the Company or, if
       applicable, the Parent Guarantor, at any time upon not less than 30 nor
       more than 60 days' notice given to the Holders at the principal amount of
       such Securities together with accrued interest thereon (of, if any such
       Securities are Original Issue Discount Securities, such portion of the
       principal amount of such Securities as may be specified by the terms
       thereof) to the date fixed for redemption (the "Tax Redemption Date").
       The Company or the Parent Guarantor, if applicable, will also pay to the
       Holders of Securities of such series on the Tax Redemption Date any
       Additional Amounts which would otherwise be payable. In order to effect a
       redemption of Securities of this series as described in this paragraph,
       the Company or the Parent Guarantor, if applicable, shall deliver to the
       Trustee not more than 60 nor less than 30 days prior to the Tax
       Redemption Date: (i) a written notice stating that the Securities of this
       series are to be redeemed as a whole and (ii) an opinion of independent
       legal counsel of recognized standing selected by the Company to the
       effect that the Company or the Parent Guarantor, as the case may be, has
       or will become obligated to pay Additional Amounts as a result of such
       change or amendment. The notice shall additionally specify the Tax
       Redemption Date. The Trustee shall be entitled to rely conclusively upon
       the information so furnished by the Company or the Parent Guarantor in
       such notice and shall be under no duty to check the accuracy or
       completeness thereof.

                                 SINKING FUNDS

1201.  Applicability of Article.

       The provisions of this Article shall be applicable to any sinking fund
       for the retirement of Securities of any series except as otherwise
       specified as contemplated by Section 301 for such Securities.

       The minimum amount of any sinking fund payment provided for by the terms
       of any Securities is herein referred to as a "mandatory sinking fund
       payment", and any payment in excess of such minimum amount provided for
       by the terms of such Securities is herein referred to as an "optional
       sinking fund payment". If provided for by the terms of any Securities,
       the cash amount of any sinking fund payment may be subject to reduction
       as provided in Section 1202. Each sinking fund payment shall be applied
       to the redemption of Securities as provided for by the terms of such
       Securities.

1202.  Satisfaction of Sinking Fund Payments with Securities.

       The Company: (1) may deliver Outstanding Securities of a series (other
       than any previously called for redemption), (2) may apply as a credit
       Securities of a series which have been redeemed either at the election of
       the Company pursuant to the terms of such Securities or through the
       application of permitted optional sinking fund payments pursuant to the
       terms of such Securities and (3) may apply as a credit Securities of such
       series that have been surrendered to the Company for conversion, in each
       case in satisfaction of all or any part of any sinking fund payment with
       respect to any Securities of such series required to be made pursuant to
       the terms of such Securities as and to the extent provided for by the
       terms of such Securities; provided that the Securities to be so credited
       have not been previously so credited. The Securities to be so credited
       shall be received and credited for such purpose by the Trustee at the
       Redemption Price, as specified in the Securities so to be redeemed, for
       redemption through operation of the sinking fund and the amount of such
       sinking fund payment shall be reduced accordingly.

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1203.  Redemption of Securities for Sinking Fund.

       Not less than 45 days prior to each sinking fund payment date for any
       Securities, the Company shall deliver to the Trustee or written statement
       specifying the amount of the next ensuing sinking fund payment for such
       Securities pursuant to the terms of such Securities, the portion thereof,
       if any, which is to be satisfied by payment of cash and the portion
       thereof, if any, which is to be satisfied by delivering and crediting
       Securities pursuant to Section 1202, and shall also deliver to the
       Trustee any Securities to be so delivered. Not less than 15 days prior to
       each such sinking fund payment date, the Trustee shall select the
       Securities to be redeemed upon such sinking fund payment date in the
       manner specified in Section 1103 and cause notice of the redemption
       thereof to be given in the manner provided in Section 1104. Such notice
       having been duly given, the redemption of such Securities shall be made
       upon the terms and in the manner stated in Sections 1106 and 1107.
       Failure of the Company, on or before any such sixtieth day, to deliver
       such written statement and Securities specified in this Section 1203, if
       any, shall not constitute a default, but shall constitute, on and as of
       such date, the irrevocable election if the Company (i) that the mandatory
       sinking fund payment for such series due on the next succeeding sinking
       fund payment date shall be paid entirely in cash without the option to
       deliver or credit Securities of such series in respect thereof and (ii)
       that the Company will make no optional sinking fund payment with respect
       to such series as provided for by the terms of the Securities.

                      DEFEASANCE AND COVENANT DEFEASANCE

1301.  Company's Option to Effect Defeasance or Covenant Defeasance.

       The Company may elect, at its option at any time, to have Section 1302 or
       Section 1303 applied to any Securities or any series of Securities, as
       the case may be, designated pursuant to Section 301 as being defeasible
       pursuant to such Section 1302 or 1303, in accordance with any applicable
       requirements provided pursuant to Section 301 and upon compliance with
       the conditions set forth below in this Article Thirteen. Any such
       election shall be evidenced by a Board Resolution or a Company Order or
       in another manner specified as contemplated by Section 301 for such
       Securities.

1302.  Defeasance and Discharge.

       Upon the Company's exercise of its option (if any) to have this Section
       applied to any Securities or any series of Securities, as the case may
       be, the Company shall be deemed to have been discharged from its
       obligations, and, if applicable, the provisions of Article Fourteen shall
       cease to be effective, with respect to such Securities as provided in
       this Section on and after the date the conditions set forth in Section
       1304 are satisfied (hereinafter called "Defeasance"). For this purpose,
       such Defeasance means that the Company shall be deemed to have paid and
       discharged the entire indebtedness represented by such Securities and to
       have satisfied all its other obligations under such Securities and this
       Indenture insofar as such Securities are concerned (and the Trustee shall
       execute proper instruments acknowledging the same), subject to the
       following which shall survive until otherwise terminated or discharged
       hereunder: (1) the rights of Holders of such Securities to receive,
       solely from the trust fund described in Section 1304 and as more fully
       set forth in such Section, payments in respect of the principal of and
       any premium and interest on such Securities when payments are due, (2)
       the Company's obligations with respect to such Securities under Sections
       304, 305, 306, 1002 and 1003, (3) the rights, powers, trusts, duties and
       immunities of the Trustee hereunder, (4) the conversion rights, if any,
       of Holders of Outstanding Securities of such series and the Company's
       obligations, if any, with respect thereto under Article Fifteen and (5)
       this Article. Subject to compliance with this Article, the Company may
       exercise its option (if any) to have

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<PAGE>

       this Section applied to any Securities notwithstanding the prior exercise
       of its option (if any) to have Section 1303 applied to such Securities.

1303.  Covenant Defeasance.

       Upon the Company's exercise of its option (if any) to have this Section
       applied to any Securities or any series of Securities, as the case may
       be, (1) the Company shall be released from its obligations under any
       covenants provided pursuant to Section 301(20), 901(3) or 901(7) for the
       benefit of the Holders of such Securities, (2) the occurrence of any
       event specified in Sections 501(4) (with respect to any such covenants
       provided pursuant to Section 301(20), 901(3) or 901(7) and 501(7) shall
       be deemed not to be or result in an Event of Default and (3) the
       provisions of Article Fourteen, if applicable, shall cease to be
       effective, in each case with respect to such Securities as provided in
       this Section on and after the date the conditions set forth in Section
       1304 are satisfied (hereinafter called "Covenant Defeasance"). For this
       purpose, such Covenant Defeasance means that, with respect to such
       Securities, the Company may omit to comply with and shall have no
       liability in respect of any term, condition or limitation set forth in
       any such specified Section (to the extent so specified in the case of
       Section 501(4)) or Article Fourteen, if applicable, whether directly or
       indirectly by reason of any reference elsewhere herein to any such
       Section or Article or by reason of any reference in any such Section or
       Article to any other provision herein or in any other document, but the
       remainder of this Indenture and such Securities shall be unaffected
       thereby.

1304.  Conditions to Defeasance or Covenant Defeasance.

       The following shall be the conditions to the application of Section 1302
       or Section 1303 to any Securities or any series of Securities, as the
       case may be:

       (1)  The Company shall irrevocably have deposited or caused to be
            deposited with the Trustee (or another trustee which satisfies the
            requirements contemplated by Section 609 and agrees to comply with
            the provisions of this Article applicable to it) as trust funds in
            trust for the purpose of making the following payments, specifically
            pledged as security for, and dedicated solely to, the benefits of
            the Holders of such Securities, (A) money in an amount, or (B) U.S.
            Government Obligations which through the scheduled payment of
            principal and interest in respect thereof in accordance with their
            terms will provide, not later than one day before the due date of
            any payment, money in an amount, or (C) a combination thereof, in
            each case sufficient, in the opinion of a nationally recognized firm
            of independent public accountants expressed in a written
            certification thereof delivered to the Trustee, to pay and
            discharge, and which shall be applied by the Trustee (or any such
            other qualifying trustee) to pay and discharge, the principal of and
            any premium and interest on such Securities on the respective Stated
            Maturities, in accordance with the terms of this Indenture and such
            Securities. As used herein, "U.S. Government Obligation" means (x)
            any security which is (i) a direct obligation of the United States
            of America for the payment of which the full faith and credit of the
            United States of America is pledged or (ii) an obligation of a
            Person controlled or supervised by and acting as an agency or
            instrumentality of the United States of America the payment of which
            is unconditionally guaranteed as a full faith and credit obligation
            by the United States of America, which, in either case (i) or (ii),
            is not callable or redeemable at the option of the issuer thereof,
            and (y) any depositary receipt issued by a bank (as defined in
            Section 3(a)(2) of the Securities Act) as custodian with respect to
            any U.S. Government

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          Obligation which is specified in Clause (x) above and held by such
          bank for the account of the holder of such depositary receipt, or with
          respect to any specific payment of principal of or interest on any
          U.S. Government Obligation which is so specified and held, provided
          that (except as required by law) such custodian is not authorized to
          make any deduction from the amount payable to the holder of such
          depositary receipt from any amount received by the custodian in
          respect of the U.S. Government Obligation or the specific payment of
          principal or interest evidenced by such depositary receipt.

     (2)  In the event of an election to have Section 1302 apply to any
          Securities or any series of Securities, as the case may be, the
          Company shall have delivered to the Trustee an Opinion of Counsel
          stating that (A) the Company has received from, or there has been
          published by, the Internal Revenue Service a ruling or (B) since the
          date of this instrument, there has been a change in the applicable
          Federal income tax law, in either case (A) or (B) to the effect that,
          and based thereon such opinion shall confirm that, the Holders of such
          Securities will not recognize gain or loss for Federal income tax
          purposes as a result of the deposit, Defeasance and discharge to be
          effected with respect to such Securities and will be subject to
          Federal income tax on the same amount, in the same manner and at the
          same times as would be the case if such deposit, Defeasance and
          discharge were not to occur.

     (3)  In the event of an election to have Section 1303 apply to any
          Securities or any series of Securities, as the case may be, the
          Company shall have delivered to the Trustee an Opinion of Counsel to
          the effect that the Holders of such Securities will not recognize gain
          or loss for Federal income tax purposes as a result of the deposit and
          Covenant Defeasance to be effected with respect to such Securities and
          will be subject to Federal income tax on the same amount, in the same
          manner and at the same times as would be the case if such deposit and
          Covenant Defeasance were not to occur.

     (4)  The Company shall have delivered to the Trustee an Officer's
          Certificate to the effect that neither such Securities nor any other
          Securities of the same series, if then listed on any securities
          exchange, will be delisted as a result of such deposit.

     (5)  No event which is, or after notice or lapse of time or both would
          become, an Event of Default with respect to such Securities or any
          other Securities shall have occurred and be continuing at the time of
          such deposit or, with regard to any such event specified in Section
          501(5), at any time on or prior to the 90th day after the date of such
          deposit (it being understood that this condition shall not be deemed
          satisfied until after such 90th day).

     (6)  Such Defeasance or Covenant Defeasance shall not cause the Trustee to
          have a conflicting interest within the meaning of the Trust Indenture
          Act (assuming all Securities are in default within the meaning of such
          Act).

     (7)  Such Defeasance or Covenant Defeasance shall not result in a breach or
          violation of, or constitute a default under, any other agreement or
          instrument to which the Company is a party or by which it is bound.

     (8)  Such Defeasance or Covenant Defeasance shall not result in the trust
          arising from such deposit constituting an investment company within
          the meaning of the Investment Company Act unless such trust shall be
          registered under such Act or exempt from registration thereunder.

     (9)  If Article Fourteen is applicable to such Securities, at the time of
          such deposit, (A) no default in the payment of any principal of or
          premium or interest on any Senior Debt shall have occurred and be
          continuing, (B) no event of default with respect to any Senior Debt
          shall have resulted in such Senior Debt becoming, and continuing to
          be,

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           due and payable prior to the date on which it would otherwise have
           become due and payable (unless payment of such Senior Debt has been
           made or duly provided for), and (C) no other event of default with
           respect to any Senior Debt shall have occurred and be continuing
           permitting (after notice or lapse of time or both) the holders of
           such Senior Debt (or a trustee on behalf of such holders) to declare
           such Senior Debt due and payable prior to the date on which it would
           otherwise have become due and payable.

      (10) The Company shall have delivered to the Trustee an Officer's
           Certificate and an Opinion of Counsel, each stating that all
           conditions precedent with respect to such Defeasance or Covenant
           Defeasance have been complied with.

1305. Deposited Money and U.S. Government Obligations to Be Held in Trust;
      Miscellaneous Provisions.

      Subject to the provisions of the last paragraph of Section 1003, all money
      and U.S. Government Obligations (including the proceeds thereof) deposited
      with the Trustee or other qualifying trustee (solely for purposes of this
      Section and Section 1306, the Trustee and any such other trustee are
      referred to collectively as the "Trustee") pursuant to Section 1304 in
      respect of any Securities shall be held in trust and applied by the
      Trustee, in accordance with the provisions of such Securities and this
      Indenture, to the payment, either directly or through any such Paying
      Agent (including the Company acting as its own Paying Agent) as the
      Trustee may determine, to the Holders of such Securities, of all sums due
      and to become due thereon in respect of principal and any premium and
      interest, but money so held in trust need not be segregated from other
      funds except to the extent required by law. Money and U.S. Government
      Obligations so held in trust shall not be subject to the provisions of
      Article Fourteen.

      The Company shall pay and indemnify the Trustee against any tax, fee or
      other charge imposed on or assessed against the U.S. Government
      Obligations deposited pursuant to Section 1304 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.

      Anything in this Article to the contrary notwithstanding, the Trustee
      shall deliver or pay to the Company from time to time upon Company Request
      any money or U.S. Government Obligations held by it as provided in Section
      1304 with respect to any Securities which, in the opinion of a nationally
      recognized firm of independent public accountants expressed in a written
      certification thereof delivered to the Trustee, are in excess of the
      amount thereof which would then be required to be deposited to effect the
      Defeasance or Covenant Defeasance, as the case may be, with respect to
      such Securities.

1306. Reinstatement.

      If the Trustee or the Paying Agent is unable to apply any money in
      accordance with this Article with respect to any Securities by reason of
      any order or judgment of any court or governmental authority enjoining,
      restraining or otherwise prohibiting such application, then the
      obligations under this Indenture and such Securities from which the
      Company has been discharged or released pursuant to Section 1302 or 1303
      shall be revived and reinstated as though no deposit had occurred pursuant
      to this Article with respect to such Securities, until such time as the
      Trustee or Paying Agent is permitted to apply all money held in trust
      pursuant to Section 1305 with respect to such Securities in accordance
      with this Article; provided, however, that if the Company makes any
      payment of principal of or any premium or interest on any such Security
      following such reinstatement of its obligations, the Company

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      shall be subrogated to the rights (if any) of the Holders of such
      Securities to receive such payment from the money so held in trust.

                          SUBORDINATION OF SECURITIES

1401. Applicability of Article.

      The provisions of this Article shall be applicable to the Securities of
      any series and, if applicable, to any Parent Guarantee specified as
      subordinated as contemplated by Section 301 for Securities of such series.

1402. Securities and, if applicable, Parent Guarantee Subordinate to Senior
      Debt.

      The Company, and if applicable the Parent Guarantor, covenants and agrees,
      and each Holder of a Security, by his acceptance thereof, likewise
      covenants and agrees, that, to the extent and in the manner hereinafter
      set forth in this Article, the indebtedness represented by the Securities
      and the payment of the principal of (and premium, if any) and interest on
      each and all of the Securities are hereby expressly made subordinate and
      subject in right of payment to the prior payment in full of all Senior
      Debt.

1403. Payment Over of Proceeds Upon Dissolution, Etc.

      In the event of (a) any insolvency or bankruptcy, or any receivership,
      liquidation, reorganization or other similar case or proceeding in
      connection therewith, relative to the Company, or, if applicable, to the
      Parent Guarantor, (b) any liquidation, dissolution or other winding up of
      the Company or, if applicable, the Parent Guarantor whether voluntary or
      involuntary, or (c) any general assignment for the benefit of creditors or
      any other marshalling of assets and liabilities of the Company or, if
      applicable, the Parent Guarantor, then and in any such event the holders
      of Senior Debt shall be entitled to receive payment in full of all amounts
      due or to become due on or in respect of all Senior Debt, or provision
      shall be made for such payment in cash or U.S. Government Obligations
      before the Holders of the Securities are entitled to receive any payment
      on account of principal of (or premium, if any) or interest on the
      Securities, including any payment in respect of the Parent Guarantee, and
      to that end the holders of Senior Debt shall be entitled to receive, for
      application to the payment thereof, any payment or distribution of any
      kind or character, whether in cash, property or securities, including any
      such payment or distribution which may be payable or deliverable by reason
      of the payment of any other indebtedness of the Company or, if applicable,
      the Parent Guarantor being subordinated to the payment of the Securities
      or, if applicable, the Parent Guarantee, which may be payable or
      deliverable in respect of the Securities or, if applicable, the Parent
      Guarantee in any such insolvency, bankruptcy, receivership, liquidation,
      reorganization, dissolution or other winding up event.

      In the event that, notwithstanding the foregoing provisions of this
      Section, the Trustee or the Holder of any Security shall have received any
      payment or distribution of assets of the Company or, if applicable, the
      Parent Guarantor of any kind or character, whether in cash, property or
      securities, including any such payment or distribution which may be
      payable or deliverable by reason of the payment of any other indebtedness
      of the Company being subordinated to the payment of the Securities or, if
      applicable, the Parent Guarantee, before all Senior Debt is paid in full
      or payment thereof provided for, and if such fact shall, at or prior to
      the time of such payment or distribution, have been made known to the
      Trustee or, as the case may be, such Holder, 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

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      Company or, if applicable, the Parent Guarantor for application to the
      payment of all Senior Debt remaining unpaid, to the extent necessary to
      pay all Senior Debt in full, after giving effect to any concurrent payment
      or distribution to or for the holders of Senior Debt.

      For purposes of this Article only, the words "cash, property or
      securities" shall not be deemed to include shares of equity of the Company
      or, if applicable, the Parent Guarantor as reorganized or readjusted, or
      securities of the Company or, if applicable, the Parent Guarantor or any
      other corporation provided for by a plan of reorganization or readjustment
      which are subordinated in right of payment to all Senior Debt which may at
      the time be outstanding to substantially the same extent as, or to a
      greater extent than, the Securities or, if applicable, the Parent
      Guarantee are so subordinated as provided in this Article. The
      consolidation of the Company or, if applicable, the Parent Guarantor with,
      or the merger of the Company or, if applicable, the Parent Guarantor into,
      another Person or the liquidation or dissolution of the Company following
      the conveyance or transfer of its properties and assets substantially as
      an entirety to another Person upon the terms and conditions set forth in
      Article Eight 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 or, if applicable, the Parent
      Guarantor for the purposes of this Section if the Person formed by such
      consolidation or into which the Company or, if applicable, the Parent
      Guarantor is merged or which acquires by conveyance or transfer such
      properties and assets substantially as an entirety, as the case may be,
      shall, as a part of such consolidation, merger, conveyance or transfer,
      comply with the conditions set forth in Article Eight.

1404. Prior Payment to Senior Debt Upon Acceleration of Securities.

      In the event that any Securities are declared due and payable before their
      Stated Maturity, then and in such event the holders of Senior Debt shall
      be entitled to receive payment in full of all amounts due or to become due
      on or in respect of such Senior Debt , or provision shall be made for such
      payment in cash or U.S. Government Obligations, before the Holders of the
      Securities are entitled to receive any payment (including any payment
      which may be payable by reason of the payment of any other indebtedness of
      the Company or, if applicable, the Parent Guarantor being subordinated to
      the payment of the Securities or, if applicable, the Parent Guarantee) by
      the Company or, if applicable, the Parent Guarantor on account of the
      principal of (or premium, if any) or interest on the Securities or on
      account of the purchase or other acquisition of Securities; provided,
      however, that nothing in this Section shall prevent the satisfaction of
      any sinking fund payment in accordance with Article Twelve by delivering
      and crediting pursuant to Section 1202 Securities which have been acquired
      (upon redemption or otherwise) prior to such declaration of acceleration
      or which have been converted pursuant to Article Fifteen.

      In the event that, notwithstanding the foregoing, the Company or, if
      applicable, the Parent Guarantor shall make any payment to the Trustee or
      the Holder of any Security prohibited by the foregoing provisions of this
      Section, and if such fact shall, at or prior to the time of such payment,
      have been made known to the Trustee or, as the case may be, such Holder,
      then and in such event such payment shall be paid over and delivered
      forthwith to the Company or, if applicable, the Parent Guarantor.

      The provisions of this Section shall not apply to any payment with respect
      to which Section 1403 would be applicable.

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1405. No Payment When Senior Debt in Default.

      (a) In the event and during the continuation of any default in the payment
      of principal of (or premium, if any) or interest on any Senior Debt beyond
      any applicable grace period with respect thereto, or in the event that any
      event of default with respect to any Senior Debt shall have occurred and
      be continuing, unless and until such event of default shall have been
      cured or waived or shall have ceased to exist, or (b) in the event any
      judicial proceeding shall be pending with respect to any such default,
      then no payment (including any payment which may be payable by reason of
      the payment of any other indebtedness of the Company or, if applicable,
      the Parent Guarantor being subordinated to the payment of the Securities
      or, if applicable, the Parent Guarantee) shall be made by the Company or,
      if applicable, the Parent Guarantor on account of principal of (or
      premium, if any) or interest on the Securities or on account of the
      purchase or other acquisition of Securities; provided, however, that
      nothing in this Section shall prevent the satisfaction of any sinking fund
      payment in accordance with Article Twelve by delivering and crediting
      pursuant to Section 1202 Securities which have been acquired (upon
      redemption or otherwise) prior to such default or which have been
      converted pursuant to Article Fifteen.

      In the event that, notwithstanding the foregoing, the Company or, if
      applicable, the Parent Guarantor shall make any payment to the Trustee or
      the Holder of any Security prohibited by the foregoing provisions of this
      Section, and if such fact shall, at or prior to the time of such payment,
      have been made known to the Trustee or, as the case may be, such Holder,
      then and in such event such payment shall be paid over and delivered
      forthwith to the Company or, if applicable, the Parent Guarantor.

      The provisions of this Section shall not apply to any payment with respect
      to which Section 1403 would be applicable.

1406. Payment Permitted If No Default.

      Nothing contained in this Article or elsewhere in this Indenture or in any
      of the Securities shall prevent (a) the Company or, if applicable, the
      Parent Guarantor, at any time except during the pendency of 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 or, if applicable, the Parent Guarantor referred to in Section
      1403 or under the conditions described in Section 1404 or 1405, from
      making payments at any time of principal of (and premium, if any) or
      interest on the Securities, or (b) the application by the Trustee of any
      money deposited with it hereunder to the payment of or on account of the
      principal of (and premium, if any) or interest on the Securities or the
      retention of such payment by the Holders, if, at the time of such
      application by the Trustee, it did not have knowledge that such payment
      would have been prohibited by the provisions of this Article.

1407. Subrogation to Rights of Holders of Senior Debt.

      Subject to the payment in full of all Senior Debt, the Holders of the
      Securities 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
      premium, if any) and interest on the Securities shall be paid in full. For
      purposes of such subrogation, no payments or distributions to the holders
      of the Senior Debt of any cash, property or securities to which the
      Holders of the Securities 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
      Securities or the Trustee, shall, as among the Company or, if applicable,
      the Parent Guarantor, its creditors other than holders of

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<PAGE>

      Senior Debt and the Holders of the Securities, be deemed to be a payment
      or distribution by the Company or, if applicable, the Parent Guarantor to
      or on account of the Senior Debt.

1408. Provisions Solely to Define Relative Rights.

      The provisions of this Article are and are intended solely for the purpose
      of defining the relative rights of the Holders of the Securities on the
      one hand and the holders of Senior Debt on the other hand. Nothing
      contained in this Article or elsewhere in this Indenture or in the
      Securities is intended to or shall (a) impair, as among the Company or, if
      applicable, the Parent Guarantor, its creditors other than holders of
      Senior Debt and the Holders of the Securities, the obligation of the
      Company or, if applicable, the Parent Guarantor, which is absolute and
      unconditional, to pay to the Holders of the Securities the principal of
      (and premium, if any) and interest on the Securities as and when the same
      shall become due and payable in accordance with their terms; or (b) affect
      the relative rights against the Company or, if applicable, the Parent
      Guarantor of the Holders of the Securities and creditors of the Company
      or, if applicable, the Parent Guarantor other than the holders of Senior
      Debt; or (c) prevent the Trustee or the Holder of any Security from
      exercising all remedies otherwise permitted by applicable law upon default
      under this Indenture, subject to the rights, if any, under this Article of
      the holders of Senior Debt to receive cash, property and securities
      otherwise payable or deliverable to the Trustee or such Holder.

1409. Trustee to Effectuate Subordination.

      Each holder of a Security 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 and
      appoints the Trustee his attorney-in-fact for any and all such purposes.

1410. No Waiver of Subordination Provisions.

      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, if applicable, the Parent 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, if applicable, the Parent 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.

      Without in any way limiting the generality of the foregoing paragraph, 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 Securities,
      without incurring responsibility to the Holders of the Securities and
      without impairing or releasing the subordination provided in this Article
      or the obligations hereunder of the Holders of the Securities to the
      holders of Senior Debt, do any one or more of the following: (i) change
      the manner, place or terms of payment or extend the time of payment of, or
      renew or alter, Senior Debt, or otherwise amend or supplement in any
      manner Senior Debt or any instrument evidencing the same or any agreement
      under which Senior Debt is outstanding; (ii) sell, exchange, release or
      otherwise deal with any property pledged, mortgaged or otherwise securing
      Senior Debt; (iii) release any Person liable in any manner for the
      collection of Senior Debt; and (iv) exercise or refrain from exercising
      any rights against the Company or, if applicable, the Parent Guarantor and
      any other Person.

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1411. Notice to Trustee

      The Company or, if applicable, the Parent Guarantor shall give prompt
      written notice to the Trustee of any fact known to the Company or, if
      applicable, the Parent Guarantor which would prohibit the making of any
      payment to or by the Trustee in respect of the Securities or, if
      applicable, the Parent Guarantee. Notwithstanding the 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
      Securities or, if applicable, the Parent Guarantee, unless and until the
      Trustee shall have received written notice thereof from the Company or, if
      applicable, the Parent Guarantor or a holder of Senior Debt or from any
      trustee therefor; and, prior to the receipt of any such written notice,
      the Trustee, subject to the provisions of Section 601, shall be entitled
      in all respects to assume that no such facts exist.

      Subject to the provisions of Section 601, the Trustee shall be entitled to
      rely on the delivery to it of a written notice by a Person representing
      himself to be a holder of Senior Debt (or a trustee therefor) to establish
      that such notice has been given by a holder of Senior Debt (or a trustee
      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, 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, 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.

1412. Reliance on Judicial Order or Certificate of Liquidating Agent.

      Upon any payment or distribution of assets of the Company or, if
      applicable, the Parent Guarantor referred to in this Article, the Trustee,
      subject to the provisions of Section 601, and the Holders of the
      Securities 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 of Securities,
      for the purpose of ascertaining the Persons entitled to participate in
      such payment or distribution, the holders of the Senior Debt and other
      indebtedness of the Company or, if applicable, the Parent 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.

1413. Trustee Not Fiduciary for Holders of Senior Debt.

      The Trustee shall not be deemed to owe any fiduciary duty to the holders
      of Senior Debt and shall not be liable to any such holders if it shall in
      good faith mistakenly pay over or distribute to Holders of Securities or
      to the Company or, if applicable, the Parent Guarantor or to any other
      Person cash, property or securities to which any holders of Senior Debt
      shall be entitled by virtue of this Article or otherwise.

1414. Rights of Trustee as 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 with respect to any Senior Debt which may at any
      time be held by it, to the same extent as any

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<PAGE>

      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 shall apply to claims of, or payments to, the
      Trustee under or pursuant to Section 607.

1415. Article Applicable to Paying Agents.

      In the event that, 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 shall (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 in addition to or in place of the
      Trustee; provided, however, that Section 1414 shall not apply to the
      Company or any Affiliate of the Company if it or such Affiliate acts as
      Paying Agent.

1416. Certain Conversions Deemed Payment.

      For the purposes of this Article only, (1) the issuance and delivery of
      junior securities upon conversion of Securities in accordance with Article
      Fifteen shall not be deemed to constitute a payment or distribution on
      account of the principal of or any premium or interest on Securities or on
      account of the purchase or other acquisition of Securities, and (2) the
      payment, issuance or delivery of cash, property or securities (other than
      junior securities) upon conversion of a Security shall be deemed to
      constitute payment on account of the principal of such Security. For the
      purposes of this Section, the term "junior securities" means (a) shares of
      any equity securities of any class of AEGON N.V. and (b) securities of the
      Company which are subordinated in right of payment to all Senior Debt
      which may be outstanding at the time of issuance or delivery of such
      securities to substantially the same extent as, or to a greater extent
      than, the Securities are so subordinated as provided in this Article.
      Nothing contained in this Article or elsewhere in this Indenture or in the
      Securities is intended to or shall impair, as among the Company or, if
      applicable, the Parent Guarantor, its creditors other than holders of
      Senior Debt and the Holders of the Securities, the right, which is
      absolute and unconditional, of the Holder of any Security to convert such
      Security in accordance with Article Fifteen.

                     CONVERSION OF CONVERTIBLE SECURITIES

1501. Applicability of Article.

      The provisions of this Article shall be applicable to any series of
      Securities of AEGON N.V. designated as "convertible" or "exchangeable"
      pursuant to Section 301 (for the purposes of this Article, "Convertible
      Securities"). For purposes of this Indenture, "convertible" shall mean
      convertible or exchangeable, as the case may be, and "convert,"
      "conversion" and words of like import shall mean convert or exchange,
      conversion or exchange and words of like import.

1502. Conversion of Convertible Securities.

      In connection with Convertible Securities of any series that are
      convertible into Common Shares, each such Convertible Security (or any
      portion thereof which is, unless otherwise specified as contemplated by
      Section 301 for Convertible Securities of any series, $1,000 or an
      integral multiple thereof) shall be convertible into Common Shares in
      accordance with the terms of Convertible Securities of such series and
      (except as otherwise specified pursuant to

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       Section 301 for Convertible Securities of such series) in accordance with
       this Article Fifteen at any time until 11:59 p.m. New York time on the
       fifth Business Day preceding the maturity date of the Convertible
       Securities of such series or in case such Convertible Security shall have
       been called for redemption, then in respect of such Convertible Security
       until (unless AEGON N.V. shall default in payment due upon the redemption
       thereof) 11:59 p.m. New York time on the fifth Business Day preceding the
       date fixed for redemption, unless otherwise specified as contemplated by
       Section 301 for Convertible Securities of such series.

       The initial Conversion Price at which a Convertible Security of any
       series is convertible shall be set forth in or established pursuant to a
       Board Resolution, Company Order or supplemental indenture, as
       contemplated by Section 301.

       Any such Convertible Security that is convertible at the option of the
       Holder thereof shall be so converted upon surrender to the Trustee or the
       Conversion Agent for surrender to AEGON N.V. in accordance with the
       instructions on file with the Trustee and the Conversion Agent, at any
       time specified for such series as contemplated by Section 301 at the
       office or agency to be maintained by AEGON N.V. in accordance with the
       provisions of Section 1002, accompanied by a written notice of election
       to convert as provided in Section 1503 and, if so required by AEGON N.V.,
       by a written instrument or instruments of transfer in form satisfactory
       to AEGON N.V. and the Conversion Agent duly executed by the Holder or his
       attorney duly authorized in writing. Any such Convertible Security that
       is convertible otherwise than at the option of the Holder thereof shall
       be so converted as specified pursuant to Section 301 for Convertible
       Securities of such series. AEGON N.V. covenants to effect such conversion
       by procuring the issuance of Common Shares or, if applicable, the Cash
       Option Amount, and payment of cash in lieu of fractional shares in
       exchange for and in consideration of delivery to them of the Convertible
       Securities. For convenience, the conversion of principal of any
       Convertible Security or Convertible Securities pursuant to this Article
       Fifteen is hereinafter sometimes referred to as the conversion of such
       Convertible Security or Convertible Securities. All Convertible
       Securities surrendered for conversion shall, if surrendered to AEGON N.V.
       or the Conversion Agent, be delivered to the Trustee for cancellation and
       canceled by it as provided in Section 306 (except as otherwise provided
       therein). Any Convertible Security surrendered for conversion shall not
       thereafter be convertible.

1503.  Issuance of Common Shares on Conversion.

       Unless AEGON N.V. elects to exercise its Cash Option, if any, specified
       pursuant to Section 301 with respect to any series of Convertible
       Securities, as promptly as practicable after the surrender as herein
       provided of any Convertible Security or Convertible Securities for
       conversion, AEGON N.V shall deliver or cause to be delivered to or upon
       the written order of the Holder of the Convertible Security or
       Convertible Securities so surrendered the number of duly authorized,
       validly issued, fully paid and nonassessable Common Shares into which
       such Convertible Security or Convertible Securities may be converted in
       accordance with the provisions of this Article Fifteen (such Common
       Shares being referred to in this Article Fifteen as the "Conversion
       Shares"). If AEGON N.V. elects to exercise its Cash Option, if any, it
       shall comply with the provisions of Section 1509. Prior to delivery of
       such Conversion Shares upon conversion of a Convertible Security at the
       option of a Holder, AEGON N.V. shall require a written notice, which
       shall be substantially in the Form of Election to Convert as provided for
       in Section 206, to be delivered to its office or agency from the Holder
       of the Convertible Security or Convertible Securities so surrendered
       stating that the Holder irrevocably elects to convert such Convertible
       Security or Convertible Securities for Common Shares, as specified in
       such notice. Such conversion notice once given shall be irrevocable and
       may not be withdrawn without the consent in writing of AEGON N.V.. AEGON
       N.V. or any Conversion Agent on its behalf, may reject any incomplete or
       incorrect conversion notice.

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       All costs and expenses incurred or caused by an incomplete or incorrect
       notice shall be for the account of the relevant Holder.

       Such conversion shall be deemed to have been made at the close of
       business on the Conversion Date, and the rights of the Holder of such
       Convertible Security as a Holder shall cease at such time. The Person or
       Persons entitled to receive the Conversion Shares upon conversion of such
       Convertible Security or Convertible Securities shall be treated for all
       purposes as having become the holder or holders of such Conversion Shares
       at such time and such conversion shall be at the Conversion Price for
       such series of Convertible Securities in effect at such time. For the
       purposes of this Article, the conversion date (the "Conversion Date")
       shall be the date on which the Convertible Securities shall have been
       duly surrendered for conversion and the duly signed and completed
       conversion notice shall have been delivered in accordance with the terms
       of this Article.

       Upon conversion of any Convertible Security which is converted in part
       only, AEGON N.V. shall execute and the Trustee shall authenticate and
       make available for delivery to or on the order of the Holder thereof a
       new Security or Security of authorized denominations in a principal
       amount equal to the unconverted portion of such Convertible Security.

1504.  No Adjustment for Interest or Dividends.

       No payment or adjustment in respect of interest on the Convertible
       Securities or dividends on the Conversion Shares shall be made upon the
       conversion of any Convertible Security or Convertible Securities;
       provided, however, that if a Convertible Security or Convertible
       Securities or any portion thereof shall be converted subsequent to any
       record date and on or prior to the next succeeding interest payment date,
       the interest falling due on such interest payment date shall be payable
       on such interest payment date notwithstanding such conversion, and such
       interest (whether or not punctually paid or duly provided for) shall be
       paid to the Person in whose name such Convertible Security is registered
       at the close of business on such record date and Convertible Securities
       surrendered for conversion during the period from the close of business
       on any record date to the opening of business on the corresponding
       interest payment date must be accompanied by payment of any amount equal
       to the interest payable on such interest payment date.

1505.  Adjustment of Conversion Price.

       Except as may otherwise be established pursuant to Section 301 with
       respect to a particular series of Convertible Securities, the Conversion
       Price in effect at any time for any series of Convertible Securities that
       is convertible into Common Shares shall be subject to adjustment as
       follows:

       (a)  If AEGON N.V. shall, after the original issue date of such series of
            Convertible Securities, (i) pay a dividend or make a distribution on
            its Common Shares in the form of Common Shares (other than a
            dividend or distribution that permits the recipient to elect between
            cash and Common Shares), (ii) split its outstanding Common Shares
            into a greater number of Common Shares or (iii) consolidate its
            outstanding Common Shares into a lesser number of Common Shares, the
            Conversion Price shall be adjusted (with effect from the Effective
            Date of such event) in accordance with the following formula:

                                       P x X
                                   A = -----
                                         Y

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          where:

          "A" shall mean the adjusted Conversion Price;

          "P" shall mean the Conversion Price prior to the adjustment;

          "X" shall mean the number of Common Shares outstanding immediately
          prior to the happening of the relevant event; and

          "Y" shall mean the number of Common Shares outstanding immediately
          after the happening of the relevant event.

     (b)  If AEGON N.V. shall, after the original issue date of such Convertible
          Securities, issue to all or substantially all holders of Common
          Shares, any rights to purchase or subscribe for Common Shares or other
          securities which are convertible into Common Shares or warrants or
          other rights to purchase or subscribe for Common Shares; and the
          purchase, subscription, conversion  or other issue price per Common
          Share (taking into account the consideration, if any, received by
          AEGON N.V.) is below the Market Price on the date of announcement of
          such issuance, the Conversion Price shall be adjusted (with effect
          from the Effective Date of such event) in accordance with the
          following formula:

                                     P x (S + f)
                                 A = -----------
                                       (S + a)

          where:

          "A" and "P" shall have the same meanings as in paragraph (a) of this
          Section 1504;

          "S" shall mean the number of Common Shares outstanding on the date of
          the announcement of such event;

          "f" shall mean the number of additional Common Shares which the
          aggregate purchase, subscription, conversion or other price (taking
          into account the consideration, if any, received by AEGON N.V.) would
          purchase at the Market Price; and

          "a" shall mean the number of additional Common Shares which are issued
          or are initially issuable pursuant to the other securities or rights
          that are the subject of the issue.

     (c)  In case AEGON N.V. shall issue or distribute, as the case may be,
          after the original issue date of such series of Convertible
          Securities, to all or substantially all holders of Common Shares any
          securities (other than as described in paragraph (a) or (b) above) or
          assets (other than cash dividends or dividends in kind in accordance
          with applicable laws) in each case declared and paid other than in the
          ordinary course of AEGON N.V.'s operations (other than as described in
          paragraph (a) or (b) above) or any rights to acquire such securities
          or assets, the Conversion Price shall be adjusted (with effect from
          the Effective Date of such event) in accordance with the following
          formula:

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<PAGE>

                                    P x (M - d)
                                A = -----------
                                         M

          where:

          "A" and "P" shall have the same meanings as in paragraph (a) of this
          Section 1504;

          "M" shall mean the Market Price on the date on which such issue or
          distribution, as the case may be, shall be made; and

          "d" shall mean the fair market value (as determined by the Board of
          Directors which determination shall be conclusive as of the date on
          which such issue or distribution, as the case may be, shall be made)
          of such portion of securities or assets or rights to acquire any of
          the foregoing as is attributable to one Common Share.

     (d)  If AEGON N.V. determines that an adjustment should be made to the
          Conversion Price, AEGON N.V. shall, if the effect of the adjustment is
          to reduce the Conversion Price, make such adjustments as it determines
          is fair and reasonable.

     (e)  Notwithstanding anything in this Section 1504 to the contrary, the
          Conversion Price may not be reduced so that, on conversion, Common
          Shares would be issued at a discount to their par value

     (f)  Except as otherwise may be specified for any series of Convertible
          Securities pursuant to Section 301, all calculations under this
          Section 1504 shall be made to the nearest cent or to the nearest one-
          hundredth of a Common Share, as the case may be.  If any doubt shall
          arise as to the appropriate adjustment to the Conversion Price, a
          certificate of the auditors of AEGON N.V. at the time shall be
          conclusive and binding on all concerned save in the case of manifest
          error.

     (g)  No adjustment in the Conversion Price shall be required unless such
          adjustment would require a change of at least 1% in the Conversion
          Price then in effect; provided, however, that any adjustments which by
          reason of this paragraph are not required to be made and any amount by
          which the Conversion Price shall be rounded shall be carried forward
          and taken into account in any subsequent adjustment.

     (h)  No adjustment in the Conversion Price shall be required for a change
          in the par value of the Common Shares.

     (i)  Notwithstanding anything herein to the contrary, no adjustment will be
          made to the Conversion Price where Common Shares or other securities
          or options, warrants or other rights to subscribe for or purchase
          Common Shares or other securities are issued to employees,
          consultants, producers, agents, dealers or marketers (including
          directors) of AEGON N.V. or of any Subsidiary or associated company of
          AEGON N.V. pursuant to any share option or share award programs or
          similar arrangements for any such persons.

     (j)  If a Conversion Date shall fall prior to the Effective Date of an
          event requiring adjustment of the Conversion Price in circumstances
          where the delivery of Common Shares in respect of the exercise of the
          relevant conversion right falls on or after such Effective Date, AEGON
          N.V. shall issue to the relevant Holder such additional number of
          Common Shares to which such Holder would have been entitled had the
          relevant Conversion Date fallen immediately following such Effective
          Date.

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       (k)  Whenever the Conversion Price of any series is adjusted, as herein
            provided, AEGON N.V. shall promptly file with the Trustee and with
            the Conversion Agent an Officer's Certificate setting forth the
            Conversion Price after such adjustment and setting forth a brief
            statement of the facts requiring such adjustment and a computation
            thereof. Such certificate shall be conclusive evidence of the
            correctness of such adjustment. Neither the Trustee nor any
            Conversion Agent shall be under any duty or responsibility with
            respect to any such certificate or any facts or computations set
            forth therein, except to exhibit said certificate from time to time
            to any Holder of Convertible Securities desiring to inspect the
            same. The Trustee, at the expense of AEGON N.V., shall cause written
            notice setting forth the adjusted Conversion Price to be provided to
            each Holder of Convertible Securities of such series.

1506.  No Fractional Conversion Shares To Be Issued.

       No fractional Conversion Shares shall be issued upon conversions of
       Convertible Securities. If more than one Convertible Security of any
       series shall be surrendered for conversion at one time by the same
       Holder, the number of full shares which shall be issuable upon conversion
       thereof shall be computed on the basis of the aggregate principal amount
       of the Convertible Securities of such series so surrendered. Instead of a
       fraction of a Conversion Share which would otherwise be issuable upon
       conversion of any Convertible Security or Convertible Securities (or
       specified portions thereof), AEGON N.V. shall pay a cash adjustment in
       respect of such fraction of a share in an amount equal to the same
       fractional interest of the Closing Price of Common Shares on the Stock
       Exchange Trading Day next preceding the day of conversion.

1507.  Preservation of Conversion Rights upon Consolidation, Merger, Sale or
       Similar Event.

       In the event that AEGON N.V. shall be a party to (i) any consolidation of
       AEGON N.V. with, or merger of AEGON N.V. into, any other Person, any
       merger of another Person into AEGON N.V. (other than a consolidation or
       merger which does not result in a conversion or cancellation of
       outstanding Common Shares of AEGON N.V.) or (ii) any sale or transfer of
       assets of AEGON N.V. or similar event which, in any such case will result
       in a reclassification or change of the Common Shares (other than a change
       in the par or nominal value or by a split or consolidation of Common
       Shares), the corporation or Person formed by such consolidation or
       resulting from such merger or which shall have acquired such assets, as
       the case may be, shall execute and deliver to the Trustee a supplemental
       indenture providing that the Holder of each Convertible Security then
       Outstanding shall have the right thereafter to convert such Convertible
       Security into the kind and amount of Common Shares, other securities,
       cash and other assets receivable upon such consolidation, merger, sale or
       similar event by a holder of the number of Common Shares into which such
       Convertible Security might have been converted immediately prior to such
       consolidation, merger, sale or similar event. In any such event, the
       Conversion Price shall be appropriately allocated to such Common Shares,
       other securities cash or other assets. Such supplemental indenture shall
       provide for adjustments which shall be as nearly equivalent as may be
       practicable to the adjustments provided for in this Article Fifteen.
       Neither the Trustee nor any Conversion Agent shall be under any
       responsibility to determine the correctness of any provision contained in
       any such supplemental indenture relating either to the kind or amount of
       shares or other securities or property receivable by Holders of
       Convertible Securities upon the conversion of their Convertible
       Securities after any such consolidation, merger, sale or transfer, or to
       any adjustment to be made with respect thereto and may accept the signing
       of such supplemental indenture by such corporation or Person as
       conclusive evidence of the

                                       75
<PAGE>

       correctness of any such provisions. The above provisions of this Section
       1506 shall similarly apply to any successive consolidation, merger, sale
       or similar event.

1508.  Covenant to Reserve Common Shares for Issuance on Conversion of
       Convertible Securities.

       AEGON N.V. covenants that it will at all times reserve and keep
       available, in the case of Convertible Securities of any series that are
       convertible into Common Shares, out of the aggregate of its authorized
       but unissued Common Shares and its issued Common Shares held in its
       treasury for the purpose of issue upon conversion of Convertible
       Securities as herein provided, such number of Common Shares as shall then
       be issuable upon the conversion of all Outstanding Convertible Securities
       of such series. AEGON N.V. shall from time to time, in accordance with
       the laws of The Netherlands, increase the authorized amount of its Common
       Shares if at any time the aggregate of the authorized amount of its
       Common Shares remaining unissued and its issued shares of Common Shares
       held in its treasury shall not be sufficient to permit the conversion of
       all Convertible Securities of such series at the time Outstanding and
       currently convertible.

1509.  Exercise of Cash Option.

       Unless otherwise specified pursuant to Section 301, AEGON N.V. may elect
       to exercise a Cash Option with respect to each series of Convertible
       Securities. If AEGON N.V. elects to pay Holders of Convertible Securities
       a Cash Option Amount in lieu of delivering Common Shares pursuant to
       Section 1503 it shall (i). notify the Conversion Agent thereof and (ii)
       as promptly as practical, on or after the Conversion Date, cause the Cash
       Option Amount to be delivered to or upon the written order of the Holder
       in the manner specified in the conversion notice, as set forth in Section
       206.

                               PARENT GUARANTEE

1601.  Parent Guarantee.

       The Parent Guarantor hereby fully and unconditionally guarantees, to each
       Holder of a Security issued by AEGON Funding, AEGON Funding II and
       authenticated and delivered by the Trustee, and to the Trustee for itself
       and on behalf of such Holder, the due and punctual payment of the
       principal of, premium, if any, and interest, if any, on such Security
       when and as the same shall become due and payable, whether at the Stated
       Maturity, by acceleration, call for redemption or otherwise, in
       accordance with the terms of such Security and of this Indenture and all
       other obligations of the Company under this Indenture. In case of the
       failure of the Company punctually to make any such payment, the Parent
       Guarantor hereby agrees to cause such payment to be made punctually when
       and as the same shall become due and payable, whether at the Stated
       Maturity or by acceleration, call for redemption or otherwise, and as if
       such payment were made by the Company.

       The Parent Guarantor hereby agrees that its obligations hereunder shall
       be absolute and unconditional, irrespective of any invalidity,
       irregularity or unenforceability of such Security or this Indenture, the
       absence of any action to enforce the same, any release or amendment or
       waiver of any term or any other guarantee of all or any of the
       Securities, any waiver or consent by the Holder of such Security or by
       the Trustee with respect to any provisions thereof or of this Indenture,
       the obtaining of any judgment against the Company or any action to
       enforce the same or any other circumstances which might otherwise
       constitute a legal or equitable discharge or defense of a guarantor,
       provided, however, that, notwithstanding the foregoing, no such release,
       amendment, waiver, consent or judgment shall, without the

                                       76
<PAGE>

       consent of the Parent Guarantor, increase the principal amount of such
       Security or increase the rate or rates or interest thereon, or increase
       any premium payable upon redemption thereof, or alter the stated maturity
       thereof or increase the principal amount or any Original Issue Discount
       Security that would be due and payable upon a declaration of acceleration
       of maturity thereof. The Parent Guarantor hereby waives the benefits of
       diligence, presentment, demand of payment, any requirement that the
       Trustee or any of the Holders exhaust any right or take any action
       against the Company or any other Person, filing of claims with a court in
       the event of insolvency or bankruptcy of the Company, protest or notice
       with respect to such Security or the debt evidenced thereby, and
       covenants that the Parent Guarantee will not be discharged in respect of
       such Security except by complete performance of the obligations contained
       in such Security and in the Parent Guarantee.; provided, however, that
       the Parent Guarantor receives prompt written notice of any failure by the
       Company to make any payment of principal, premium, if any, or interest or
       sinking fund or analogous payment, if any. The Parent Guarantor hereby
       agrees that, in the event of a default in payment of principal, premium,
       if any, or interest, if any, on such Security, whether at their Stated
       Maturity, by acceleration, call for redemption, purchase or otherwise,
       legal proceedings may be instituted by the Trustee on behalf of, or by,
       the Holder of such Security, subject to the terms and conditions set
       forth in this Indenture, directly against the Parent Guarantor to enforce
       the Parent Guarantee without first proceeding against the Company.

       Each Parent Guarantee shall remain in full force and effect and continue
       to be effective should any petition be filed by or against the Company
       for liquidation or reorganization, should the Company become insolvent or
       make an assignment for the benefit of creditors or should a receiver or
       trustee be appointed for all or any significant part of the Company's
       assets, and shall to the fullest extent permitted by law, continue to be
       effective or be reinstated, as the case may be, if at any time payment
       and performance of the Securities is, pursuant to applicable law,
       rescinded or reduced in amount, or must otherwise be restored or returned
       by any obligee on the Securities, whether as a "voidable preference,"
       "fraudulent transfer," or otherwise, all as though such payment or
       performance had not been made. In the event that any payment, or any part
       thereof, is rescinded, reduced, restored or returned, the Securities
       shall, to the fullest extent permitted by law, be reinstated and deemed
       reduced only by such amount paid and not so rescinded, reduced, restored
       or returned.

       Notwithstanding anything herein to the contrary, any Parent Guarantee
       related to any Security that is designated as subordinated shall be
       subordinated to the extent and in the manner provided in Article
       Fourteen.

1602.  Execution and Delivery of Parent Guarantees.

       The Parent Guarantee to be endorsed on the Securities shall include the
       terms of the Parent Guarantee set forth in Section 1601 and any other
       terms that may be set forth in the form established pursuant to Article
       Two. The Parent Guarantor hereby agrees to execute its Parent Guarantee,
       in the form established pursuant to Article Two, to be endorsed on each
       Security authenticated and delivered by the Trustee.

       The Parent Guarantees shall be executed on behalf of the Parent Guarantor
       by any one of the Parent Guarantor's Chairman of the Board, Vice Chairman
       of the Board, President or Vice Presidents, attested by its Secretary or
       any Assistant Secretary. The signature of any or all of these officers on
       the Parent Guarantee may be manual or facsimile.

       A Parent Guarantee bearing the manual or facsimile signatures of
       individuals who were at any time the proper officers of the Parent
       Guarantor shall bind the Parent Guarantor, notwithstanding that such
       individuals or any of them have ceased to hold such offices prior to

                                       77
<PAGE>

     the authentication and delivery of the Security on which such Parent
     Guarantee is endorsed or did not hold such offices at the date of such
     Parent Guarantee.

     The delivery of any Security by the Trustee, after the authentication
     thereof hereunder, shall constitute due delivery of the Parent Guarantee
     endorsed thereon on behalf of the Parent Guarantor.  The Parent Guarantor
     agrees that its Parent Guarantee set forth in this Section 1601 shall
     remain in full force and effect notwithstanding any failure to endorse a
     Parent Guarantee on any Security.

                                       78
<PAGE>

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

In Witness Whereof, the parties hereto have caused this Indenture to be duly
executed as of the day and year first above written.

---------------------------                           --------------------------
AEGON N.V.                                            AEGON Funding Corp.

By: /s/ C.M. VAN KATWIJK                              By: /s/ C.M. VAN KATWIJK
    -----------------------                               ----------------------

---------------------------                           --------------------------
AEGON Funding Corp. II                                Citibank, N.A., as Trustee

By: /s/ C.M. VAN KATWIJK                              By: /s/ JOHN J. BYRNES
    -----------------------                               ----------------------

                                       79
<PAGE>

                               TABLE OF CONTENTS*

<TABLE>
<CAPTION>
                                                                            Page
<S>                                                                         <C>
Definitions and Other Provisions of General Application                        1
101. Definitions...........................................................    1
     Act...................................................................    2
     Additional Amounts....................................................    2
     Affiliate.............................................................    2
     Authenticating Agent..................................................    2
     Average Price Per Share...............................................    2
     Board of Directors....................................................    3
     Board Resolution......................................................    3
     Business Day..........................................................    3
     Cash Dividend.........................................................    3
     Cash Option...........................................................    3
     Cash Option Amount....................................................    3
     Closing Price.........................................................    3
     Commission............................................................    3
     Common Shares.........................................................    3
     Company...............................................................    3
     Company Request; Company Order........................................    3
     Conversion Agent......................................................    3
     Conversion Date.......................................................    3
     Conversion Price......................................................    3
     Conversion Shares.....................................................    4
     Convertibel Securities................................................    4
     Corporate Trust Office................................................    4
     corporation...........................................................    4
     Covenant Defeasance...................................................    4
     Defaulted Interest....................................................    4
     Defeasance............................................................    4
     Depositary............................................................    4
     Effective Date........................................................    4
     Event of Default......................................................    4
     Exchange Act..........................................................    4
     Expiration Date.......................................................    4
     Global Security.......................................................    4
     Holder................................................................    4
     Indebtedness..........................................................    4
     Indenture.............................................................    4
     interest..............................................................    5
     Interest Payment Date.................................................    5
     Investment Company Act................................................    5
     Market Price..........................................................    5
     Maturity..............................................................    5
     Notice of Default.....................................................    5
     New York Shares.......................................................    5
     Officers' Certificate.................................................    5
     Opinion of Counsel....................................................    5
     Ordinary Shares.......................................................    5
</TABLE>

__________________________________

*NOTE: This table of contents shall not, for any purpose, be deemed to be part
       of the Indenture.

                                       80
<PAGE>

<TABLE>
<S>                                                                         <C>
     Original Issue Discount Security......................................    5
     Outstanding...........................................................    5
     Parent Guarantee......................................................    6
     Paying Agent..........................................................    6
     Person................................................................    6
     Place of Payment......................................................    6
     Predecessor Security..................................................    7
     Redemption Date.......................................................    7
     Redemption Price......................................................    7
     Regular Record Date...................................................    7
     Responsible Officer...................................................    7
     Securities............................................................    7
     Securities Act........................................................    7
     Security Register.....................................................    7
     Senior Debt...........................................................    7
     Special Record Date...................................................    7
     Stated Maturity.......................................................    7
     Stock Exchange Trading Day............................................    7
     Subordinated Indebtedness.............................................    7
     Subsidiary............................................................    8
     Total Current Dividend................................................    8
     Trust Indenture Act...................................................    8
     Trustee...............................................................    8
     U.S. Government Obligation............................................    8
     Vice President........................................................    8
102. Compliance Certificates and Opinions..................................    8
103. Form of Documents Delivered to Trustee................................    9
104. Acts of Holders; Record Dates.........................................    9
105. Notices, Etc., to Trustee and Company.................................   11
106. Notice to Holders; Waiver.............................................   11
107. Conflict with Trust Indenture Act.....................................   12
108. Effect of Headings and Table of Contents..............................   12
109. Successors and Assigns................................................   12
110. Separability Clause...................................................   12
111. Benefits of Indenture.................................................   12
112. Governing Law.........................................................   12
113. Legal Holidays........................................................   12
114. Agent for Service; Submission to Jurisdiction; Waiver of Immunities...   12

Security Forms.............................................................   13
201. Forms Generally.......................................................   13
202. Form of Face of Security..............................................   13
203. Form of Reverse of Security...........................................   16
204. Form of Legend for Global Securities..................................   21
205. Form of Trustee's Certificate of Authentication.......................   21
206. Form of Election to Convert...........................................   21
207. Form of Parent Guarantee..............................................   23

The Securities.............................................................   24
301. Amount Unlimited; Issuable in Series..................................   24
302. Denominations.........................................................   27
303. Execution, Authentication, Delivery and Dating........................   27
304. Temporary Securities..................................................   28
</TABLE>

                                       81
<PAGE>

<TABLE>
<S>                                                                                                       <C>
305. Registration, Registration of Transfer and Exchange................................................  29
306. Mutilated, Destroyed, Lost and Stolen Securities...................................................  30
307. Payment of Interest; Interest Rights Preserved.....................................................  31
308. Persons Deemed Owners..............................................................................  32
309. Cancellation.......................................................................................  32
310. Computation of Interest............................................................................  33

Satisfaction and Discharge..............................................................................  33
401. Satisfaction and Discharge of Indenture............................................................  33
402. Application of Trust Money.........................................................................  34

Remedies................................................................................................  34
501. Events of Default..................................................................................  34
502. Acceleration of Maturity; Rescission and Annulment.................................................  35
503. Collection of Indebtedness and Suits for Enforcement by Trustee....................................  36
504. Trustee May File Proofs of Claim...................................................................  37
505. Trustee May Enforce Claims Without Possession of Securities........................................  37
506. Application of Money Collected.....................................................................  37
507. Limitation on Suits................................................................................  38
508. Unconditional Right of Holders to Receive Principal Premium and interest...........................  38
509. Restoration of Rights and Remedies.................................................................  38
510. Rights and Remedies Cumulative.....................................................................  39
511. Delay or Omission Not Waiver.......................................................................  39
512. Control by Holders.................................................................................  39
513. Waiver of Past Defaults............................................................................  39
514. Undertaking for Costs..............................................................................  40
515. Waiver of Usury, Stay or Extension Laws............................................................  40

The Trustee.............................................................................................  40
601. Certain Duties and Responsibilities................................................................  40
602. Notice of Defaults.................................................................................  40
603. Certain Rights of Trustee..........................................................................  40
604. Not Responsible for Recitals or Issuance of Securities.............................................  42
605. May Hold Securities................................................................................  42
606. Money Held in Trust................................................................................  42
607. Compensation and Reimbursement.....................................................................  42
608. Conflicting Interests..............................................................................  42
609. Corporate Trustee Required; Eligibility............................................................  43
610. Resignation and Removal; Appointment of Successor..................................................  43
611. Acceptance of Appointment by Successor.............................................................  44
612. Merger, Conversion, Consolidation or Succession to Business........................................  45
613. Preferential Collection of Claims Against Company..................................................  45
614. Appointment of Authenticating Agent................................................................  46

Holders' Lists and Reports by Trustee and Company.......................................................  47
701. Company to Furnish Trustee Names and Addresses of Holders..........................................  47
702. Preservation of Information; Communications to Holders.............................................  47
703. Reports by Trustee.................................................................................  48
704. Reports by Company.................................................................................  48

Consolidation, Merger, Conveyance, Transfer or Lease....................................................  48
801. Company or, if Applicable, Parent Guarantor and Company May Consolidate, Etc., Only on Certain
     Terms..............................................................................................  48
</TABLE>

                                       82
<PAGE>

<TABLE>
<S>                                                                                                        <C>
802.  Successor Substituted..............................................................................  49

Supplemental Indentures..................................................................................  49
901.  Supplemental Indentures Without Consent of Holders.................................................  49
902.  Supplemental Indentures With Consent of Holders....................................................  50
903.  Execution of Supplemental Indentures...............................................................  51
904.  Effect of Supplemental Indentures..................................................................  51
905.  Conformity with Trust Indenture Act................................................................  52
906.  Reference in Securities to Supplemental Indentures.................................................  52

Covenants................................................................................................  52
1001. Payment of Principal, Premium and Interest.........................................................  52
1002. Maintenance of Office or Agency....................................................................  52
1003. Money for Securities Payments to Be Held in Trust..................................................  52
1004. Statement by Officers as to Default................................................................  53
1005. Existence..........................................................................................  54
1006. Payments of Additional Amounts.....................................................................  54
1007. Waiver of Certain Covenants........................................................................  55
1008. Calculation of Original Issue Discount.............................................................  56
1009. Limitation on Liens................................................................................  56

Redemption of Securities.................................................................................  56
1101. Applicability of Article...........................................................................  56
1102. Election to Redeem; Notice to Trustee..............................................................  56
1103. Selection by Trustee of Securities to Be Redeemed..................................................  57
1104. Notice of Redemption...............................................................................  57
1105. Deposit of Redemption Price........................................................................  58
1106. Securities Payable on Redemption Date..............................................................  58
1107. Securities Redeemed in Part........................................................................  59
1108. Conversion Arrangement on Call for Redemption......................................................  59
1109. Redemption for Tax Reasons.........................................................................  59

Sinking Funds............................................................................................  60
1201. Applicability of Article...........................................................................  60
1202. Satisfaction of Sinking Fund Payments with Securities..............................................  60
1203. Redemption of Securities for Sinking Fund..........................................................  61

Defeasance and Covenant Defeasance.......................................................................  61
1301. Company's Option to Effect Defeasance or Covenant Defeasance.......................................  61
1302. Defeasance and Discharge...........................................................................  61
1303. Covenant Defeasance................................................................................  62
1304. Conditions to Defeasance or Covenant Defeasance....................................................  62
1305. Deposited Money and U.S. Government Obligations to Be Held in Trust; Miscellaneous Provisions......  64
1306. Reinstatement......................................................................................  64

Subordination of Securities..............................................................................  65
1401. Applicability of Article...........................................................................  65
1402. Securities and, if applicable, Parent Guarantee Subordinate to Senior Debt.........................  65
1403. Payment Over Proceeds Upon Dissolution, Etc........................................................  65
1404. Prior Payment to Senior Debt Upon Acceleration of Securities.......................................  66
1405. No Payment When Senior Debt in Default.............................................................  67
1406. Payment Permitted if No Default....................................................................  67
1407. Subrogation to Rights of Holders of Senior Debt....................................................  67
</TABLE>

                                       83
<PAGE>

<TABLE>
<S>                                                                                                       <C>
1408. Provisions Solely to Define Relative Rights........................................................  68
1409. Trustee to Effectuate Subordination................................................................  68
1410. No Waiver of Subordination Provisions..............................................................  68
1411. Notice to Trustee..................................................................................  69
1412. Reliance on Judicial Order or Certificate of Liquidating Agent.....................................  69
1413. Trustee Not Fiduciary for Holders of Senior Debt...................................................  69
1414. Rights of Trustee as Holder of Senior Debt; Preservation of Trustee's Rights.......................  69
1415. Article Applicable to Paying Agents................................................................  70
1416. Certain Conversions Deemed Payment.................................................................  70

Conversion of Convertible Securities.....................................................................  70
1501. Applicability of Article...........................................................................  70
1502. Conversion of Securities...........................................................................  70
1503. Issuance of Common Shares on Conversion............................................................  71
1504. No Adjustment for Interest or Dividends............................................................  72
1505. Adjustment of Conversion Price.....................................................................  72
1506. No Fractional Conversion Shares To Be Issued.......................................................  75
1507. Preservation of Conversion Rights upon Consolidation, Merger, Sale or Similar Event................  75
1508. Covenant to Reserve Common Shares for Issuance on Conversion of Securities.........................  76
1509. Exercise of Cash Option............................................................................  76

Parent Guarantee.........................................................................................  76
1601. Parent Guarantee...................................................................................  76
1602. Execution and Delivery of Parent Guarantees........................................................  77
SIGNATURES...............................................................................................  79
</TABLE>
                                       84
<PAGE>

    Certain Sections of this Indenture relating to Sections 310 through 318,
                 inclusive, of the Trust Indenture Act of 1939:

<TABLE>
<CAPTION>

Trust Indenture
 Act Section                                                    Indenture Section

<S>                                                             <C>
    (S) 310(a)(1)............................................       609
           (a)(2)............................................       609
           (a)(3)............................................    Not Applicable
           (a)(4)............................................    Not Applicable
           (b)   ............................................       608
                                                                    610
    (S) 311(a)   ............................................       613
           (b)   ............................................       613
    (S) 312(a)   ............................................       701
                                                                    702
           (b)   ............................................       702
           (c)   ............................................       702
    (S) 313(a)   ............................................       703
           (b)   ............................................       703
           (c)   ............................................       703
           (d)   ............................................       703
    (S) 314(a)   ............................................       704
           (a)(4)............................................       101
                                                                    1004
           (b)   ............................................    Not Applicable
           (c)(1)............................................       102
           (c)(2)............................................       102
           (c)(3)............................................    Not Applicable
           (d)   ............................................    Not Applicable
           (e)   ............................................       102
    (S) 315(a)   ............................................       601
           (b)   ............................................       602
           (c)   ............................................       601
           (d)   ............................................       601
           (e)   ............................................       514
    (S) 316(a)   ............................................       101
           (a)(1)(A).........................................       502
                                                                    512
           (a)(1)(B).........................................       513
           (a)(2)............................................    Not Applicable
           (b)   ............................................       508
           (c)   ............................................       104
    (S) 317(a)(1)............................................       503
           (a)(2)............................................       504
           (b)   ............................................       1003
    (S) 318(a)   ............................................       107

</TABLE>
-------------------

Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture

                                      85
<PAGE>

                          Dated as of October 11, 2001

          AEGON N.V., AEGON Funding Corp. and AEGON Funding Corp. II

                                      and

                                 Citibank, N.A.

            ________________________________________________________

                                   INDENTURE

            _______________________________________________________

                                 ALLEN & OVERY
                                    London
                                 ICM:544683.5<PAGE>

                                                                     Exhibit 4.1

                     _____________________________________

                          THIRD SUPPLEMENTAL INDENTURE

                          DATED AS OF OCTOBER 10, 2001

                                     BETWEEN

                       ELECTRONIC DATA SYSTEMS CORPORATION

                                    AS ISSUER

                                       AND

                            THE CHASE MANHATTAN BANK

                                   AS TRUSTEE

                     _____________________________________

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                      Page
<S>                                                                                                                   <C>
                                                ARTICLE I

                                               DEFINITIONS

Section 1.1  Definition of Terms ...................................................................................    1

                                                 ARTICLE II

                                  GENERAL TERMS AND CONDITIONS OF THE NOTES

Section 2.1  Designation and Principal Amount ......................................................................    8
Section 2.2  Maturity ..............................................................................................    8
Section 2.3  Form ..................................................................................................    8
Section 2.4  Global Securities .....................................................................................    8

                                                ARTICLE III

                                       REDEMPTION AND CONVERSIONS

Section 3.1  Optional Redemption by the Company ....................................................................    8
Section 3.2  Purchase at Option of the Holder upon a Fundamental Change ............................................   10
Section 3.3  Purchase of Notes at the Option of the Holder; Payment of Purchase Price in Stock .....................   12
Section 3.4  Deposit of Purchase Price or Fundamental Change Purchase Price ........................................   18
Section 3.5  Further Conditions for Purchase at the Option of Holders upon a
                Fundamental Change and Purchase of Notes at the Option of the Holder................................   18
Section 3.6  Conversion of Notes ...................................................................................   20
Section 3.7  Adjustments to Conversion Rate ........................................................................   23
Section 3.8  Miscellaneous Provisions Relating to Conversion .......................................................   26
Section 3.9  Optional Conversion to Semi-Annual Cash Pay Notes upon Tax Event ......................................   29
Section 3.10 Calculation and Reporting of Original Issue Discount for U.S. Federal  Income Tax Purposes ............   30
Section 3.11 Payment of Interest ...................................................................................   31

                                                ARTICLE IV

                                                 NOTICE

Section 4.1  Notice by the Company .................................................................................   33

                                                ARTICLE V

                                            EVENTS OF DEFAULT

Section 5.1  Events of Default .....................................................................................   33
</TABLE>

                                       i

<PAGE>

<TABLE>
<S>                                                                                                    <C>
                                                ARTICLE VI

                                               MODIFICATION

Section 6.1 Purposes for Which Supplemental Indenture May Be Entered Into Without
                Consent of Holders..................................................................    36
Section 6.2 Modification of Indenture with Consent of Holders of Notes..............................    36

                                                ARTICLE VII

                                         AMENDMENT OF CERTAIN OTHER
                                      PROVISIONS OF THE BASE INDENTURE

Section 7.1 Amendments Relating to the Notes .......................................................    38
Section 7.2 Interpretation of Base Indenture .......................................................    40

                                                ARTICLE VIII

                                                MISCELLANEOUS

Section 8.1 Ratification of Indenture ..............................................................    40
Section 8.2 Trustee Not Responsible for Recitals ...................................................    41
Section 8.3 New York Law to Govern .................................................................    41
Section 8.4 Separability ...........................................................................    41
Section 8.5 Counterparts ...........................................................................    41

EXHIBITS

Exhibit A - Form of Global Security ................................................................   A-1
Exhibit B - Projected Payment Schedule .............................................................   B-1
</TABLE>

                                       ii

<PAGE>

          THIRD SUPPLEMENTAL INDENTURE, dated as of October 10, 2001 (the "Third
Supplemental Indenture"), between Electronic Data Systems Corporation, a
corporation duly organized and existing under the laws of the State of Delaware
(the "Company"), and The Chase Manhattan Bank (formerly Chase Bank of Texas,
      -------
National Association and Texas Commerce Bank, National Association), as trustee
(the "Trustee").
      -------

          WHEREAS, the Company executed and delivered the Indenture dated as of
August 12, 1996 (the "Base Indenture") to the Trustee to provide for the
                      --------------
issuance of the Company's debentures, notes, bonds or other evidence of
indebtedness (the "Debt Securities"), to be issued from time to time in one or
                   ---------------
more series as might be determined by the Company pursuant to the Base
Indenture; and

          WHEREAS, pursuant to the terms of the Base Indenture, the
Company desires to provide for the establishment of a new series of its Debt
Securities to be known as its Zero-Coupon Convertible Senior Notes Due October
10, 2021 (the "Notes"), the form and terms of such Notes and the terms,
               -----
provisions and conditions thereof to be set forth as provided in the Base
Indenture and this Third Supplemental Indenture (together, the "Indenture"); and
                                                                ---------

          WHEREAS, the Company has requested that the Trustee execute and
deliver this Third Supplemental Indenture and all requirements necessary to make
this Third Supplemental Indenture a valid, binding and enforceable instrument in
accordance with its terms, and to make the Notes, when executed, authenticated
and delivered by the Company, the valid, binding and enforceable obligations of
the Company, have been done and performed, and the execution and delivery of
this Third Supplemental Indenture has been duly authorized in all respects.

          NOW THEREFORE, in consideration of the purchase and acceptance of the
Notes by the Holders thereof, and for the purpose of setting forth, as provided
in the Base Indenture, the form and terms of the Notes, the Company covenants
and agrees with the Trustee as follows:

                                   ARTICLE I

                                   DEFINITIONS

          Section 1.1  Definition of Terms.  Unless the context otherwise
                       -------------------
          requires:

          (a) a term defined in the Base Indenture has the same meaning when
used in this Third Supplemental Indenture;

          (b) a term defined anywhere in this Third Supplemental Indenture has
the same meaning throughout;

          (c) the singular includes the plural and vice versa;

          (d) headings are for convenience of reference only and do not affect
interpretation;

          (e) the following terms have the meanings given to them in this
Section 1.1(e):

<PAGE>

          "Accreted Conversion Price" as of any date means the price determined
           -------------------------
by dividing (x) the Accreted Value at such date, by (y) the Conversion Rate at
such date.

          "Accreted Value" means, at any date of determination, (1) prior to
           --------------
such time as the Notes are converted to Cash Pay Notes, the sum of (x) the Issue
Price of each Note and (y) the portion of the excess of the Principal Amount of
each Note over the Issue Price ("Original Issue Discount") which shall have been
                                 -----------------------
amortized by the Company in accordance with GAAP through such date, such amount
to be so amortized on a daily basis and compounded semi-annually on each October
10 and April 10 at the rate of 1.25% per annum from the Issue Date through the
date of determination computed on the basis of a 360-day year of twelve 30-day
months and (2) at or after such time as the Notes are converted to Cash Pay
Notes, the Restated Principal Amount.

          "Bid Agent" means a bid solicitation agent appointed by the Company to
           ---------
act in such capacity pursuant to paragraph 3 of the Notes.

          "Capital Stock" means, with respect to any Person, any and all shares,
           -------------
interests, participations or other equivalents (however designated) of or in
such Person's capital stock or other equity interests, and options, rights or
warrants to purchase such capital stock or other equity interests, whether now
outstanding or issued after the Issue Date, including, without limitation, all
Preferred Stock.

          "Cash" has the meaning provided in Section 3.3(c).
           ----

          "Cash Dividends" has the meaning assigned thereto in Exhibit A hereto.
           --------------

          "Cash Pay Notes" means the Notes, after they have been converted to
           --------------
semi-annual cash pay Notes following the occurrence of a Tax Event.

          "Common Equity" of any Person means Capital Stock of such Person that
           -------------
is generally entitled to (1) vote in the election of directors of such Person or
(2) if such Person is not a corporation, vote or otherwise participate in the
selection of the governing body, partners, managers or others that will control
the management or policies of such Person.

          "Common Stock" means the common stock of the Company, par value $0.01
           ------------
per share, as it exists on the Issue Date and any shares of any class or classes
of Capital Stock of the Company 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 on
conversion of Notes 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 such
reclassifications.

          "Common Stock Record Date" means, with respect to any dividend,
           ------------------------
distribution or other transaction or event in which the holders of Common Stock
have the right to receive any cash, securities or other property or in which the
Common Stock (or other applicable security) is

                                       2

<PAGE>

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).

          "Company Notice" has the meaning provided in Section 3.3(f).
           --------------

          "Company Notice Date" has the meaning provided in Section 3.3(f).
           -------------------

          "Continuing Director" means a director who either was a member of the
           -------------------
Board of Directors of the Company on October 4, 2001 or who became a director of
the Company subsequent to such date and whose election, or nomination for
election by the Company's stockholders, was duly approved by a majority of the
Continuing Directors on the Board of Directors of the Company at the time of
such approval, either by a specific vote or by approval of the proxy statement
issued by the Company on behalf of the entire Board of Directors of the Company
in which such individual is named as nominee for director.

          "Conversion Agent" means the office or agency designated by the
           ----------------
Company where Notes may be presented for conversion.

          "Conversion Date" has the meaning provided in Section 3.6(b).
           ---------------

          "Conversion Rate" has the meaning provided in Section 3.6(a).
           ---------------

          "Defaulted Interest" has the meaning specified in Section
           ------------------
3.11(c)(ii).

          "Distributed Securities" has the meaning provided in Section 3.7(c).
           ----------------------

          "Exchange Act" means the Securities Exchange Act of 1934, as amended
           ------------
and the rules and regulations promulgated thereunder.

          "Fair Market Value" means, with respect to any asset, the price (after
           -----------------
taking into account any liabilities relating to such assets) that would be
negotiated in an arm's-length transaction for cash between a willing seller and
a willing and able buyer, neither of which is under any compulsion to complete
the transaction, as such price is determined in good faith by the Board of
Directors of the Company or a duly authorized committee thereof, as evidenced by
a resolution of such Board or committee.

          "Five-Day Period" has the meaning assigned thereto in Exhibit A
           ---------------
hereto.

          "Fundamental Change" will be deemed to have occurred at such time
           ------------------
after the Issue Date as any of the following occurs:

          (1) any sale, lease or other transfer (in one transaction or a series
     of transactions) of all or substantially all of the consolidated assets of
     the Company and its Subsidiaries to any Person (other than a Subsidiary);
     provided, however, that a transaction where the holders of all classes of
     Common Equity of the Company immediately prior to such transaction own,
     directly or indirectly, more than 50% of all

                                       3

<PAGE>
         classes of Common Equity of such Person immediately after such
         transaction shall not be a Fundamental Change;

               (2) a "person" or "group" (within the meaning of Section 13(d) of
         the Exchange Act) (other than the Company) becomes the "beneficial
         owner" (as defined in Rule 13d-3 under the Exchange Act) of Common
         Equity of the Company representing more than 50% of the voting power of
         the Common Equity of the Company;

               (3) Continuing Directors cease to constitute at least a majority
         of the Board of Directors of the Company; or

               (4) the stockholders of the Company approve any plan or proposal
         for the liquidation or dissolution of the Company; provided, however,
         that a liquidation or dissolution of the Company which is part of a
         transaction that does not constitute a Fundamental Change under the
         proviso contained in clause (1) above shall not constitute a
         Fundamental Change.

               A Fundamental Change will not be deemed to have occurred,
however, if either:

                   (I)  the Sale Price of the Common Stock for (a) any 10
               Trading Days within the 20 consecutive Trading Days ending
               immediately before the Fundamental Change, and (b) at least
               five-Trading-Days within the 10 consecutive Trading Days ending
               immediately before the Fundamental Change, shall equal or exceed
               105% of the Accreted Value, divided by the Conversion Rate, or

                   (II) both:

                        (a) at least 90% of the consideration (excluding cash
                   payments for fractional shares) in the transaction or
                   transactions constituting the Fundamental Change consists of
                   shares of Common Equity traded on a national securities
                   exchange or quoted on the Nasdaq Stock Market (or which will
                   be so traded or quoted when issued or exchanged in
                   connection with such Fundamental Change) (such securities
                   being referred to as "Publicly Traded Securities") and as a
                                         --------------------------
                  result of such transaction or transactions the Notes become
                   convertible solely into such Publicly Traded Securities
                   (excluding cash payments for fractional shares); and

                        (b) the consideration to be received per share of Common
                   Stock in the transaction or transactions constituting the
                   Fundamental Change consists of cash, Publicly Traded
                   Securities or a combination of cash and Publicly Traded
                   Securities with an aggregate fair market value (which, in the
                   case of Publicly Traded Securities, shall be equal to the
                   average closing price of such Publicly Traded Securities
                   during the five consecutive Trading Days commencing with the
                   Trading Day following consummation of the transaction or
                   transactions constituting the Fundamental Change) of at least
                   105% of the Accreted Value, divided by the Conversion Rate.

                                       4

<PAGE>

          "Fundamental Change Purchase Date" has the meaning provided in Section
           --------------------------------
3.2(a).

          "Fundamental Change Notice" has the meaning provided in Section
           -------------------------
3.2(b).

          "Fundamental Change Purchase Notice" has the meaning provided in
           ----------------------------------
Section 3.2(c).

          "Fundamental Change Purchase Price" has the meaning provided in
           ---------------------------------
Section 3.2(a).

          "GAAP" means generally accepted accounting principles set forth in the
           ----
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession of the United States, as in effect on the date of this Supplemental
Indenture.

          "Holder" means the Person in whose name a Note is registered in the
           ------
books of the Registrar for the Notes.

          "Interest Payment Date" has the meaning specified in Section 3.9.
           ---------------------

          "Investment Grade" shall mean BBB- or higher by S&P or Baa3 or higher
           ----------------
by Moody's or the equivalent of such ratings by S&P or Moody's.

          "Issue Date" means the date on which the Notes that constitute the
           ----------
Initial Securities (as defined in the Underwriting Agreement) are originally
issued under this Third Supplemental Indenture. The Issue Date for the Option
Securities (as defined in the Underwriting Agreement) shall be deemed to be the
same as the Issue Date of the Initial Securities.

          "Issue Price" of the Notes means, in connection with the original
           -----------
issuance of the Notes, the initial issue price at which the Notes were issued as
set forth on the face of the Notes.

          "Original Issue Discount" has the meaning specified in the definition
           -----------------------
of "Accreted Value."

          "Market Price" means, on any date, the average of the Sale Prices of
           ------------
the Common Stock for the 20 Trading Day period ending on the third business day
(if the third business day prior to the applicable date is a Trading Day or, if
not, then on the last Trading Day prior to such third business day) prior to
such date, appropriately adjusted to take into account the occurrence, during
the period commencing on the first of such Trading Days during such 20 Trading
Day period and ending on such date, of certain events with respect to the Common
Stock that would result in an adjustment of the Conversion Rate under this Third
Supplemental Indenture.

          "Maturity or Maturity Date" means October 10, 2021.
           --------    -------------

                                        5

<PAGE>

     "Moody's" means Moody's Investors Service, Inc. or any successor to its
      -------
debt rating business.

     "Note Price" has the meaning assigned thereto in Exhibit A hereto.
      ----------

     "Option Exercise Date" has the meaning specified in Section 3.9.
      --------------------

     "Paying Agent" means the Trustee or any successor paying agent.
      ------------

     "Preferred Stock" of any Person means all Capital Stock of such Person
      ---------------
which has a preference in liquidation or with respect to the payment of
dividends.

     "Principal Amount" of a Note means the principal amount of such Note at
      ----------------
Maturity.

     "Publicly Traded Securities" has the meaning provided in the definition of
      --------------------------
"Fundamental Change."

     "Purchase Date" has the meaning specified in Section 3.3(a).
      -------------

     "Purchase Notice" has the meaning provided in Section 3.3(a)(1).
      ---------------

     "Purchase Price" has the meaning provided in Section 3.3(a).
      --------------

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

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

     "Regular Record Date" has the meaning specified in Section 3.9.
      -------------------

     "Restated Principal Amount" has the meaning specified in Section 3.9.
      -------------------------

     "S&P" means Standard and Poor's Ratings Services or any successor to its
      ---
debt rating business.

     "Sale Price" of the Common Stock on any date means the closing sale price
      ----------
per share (or, if no closing sale price is reported, the average of the bid and
ask prices or, if more than one in either case, the average of the average bid
and average ask prices) on such date as reported in the composite transactions
for the principal United States securities exchange on which the Common Stock is
traded or, if the Common Stock is not listed on a United States national or
regional securities exchange, as reported by the Nasdaq Stock Market.

     "Special Record Date" has the meaning specified in Section 3.11(c)(ii)(A).
      -------------------

     "Stated Maturity", when used with respect to any Note or any installment of
      ---------------
semi-annual or contingent interest thereon, means the date specified in such
Note as the fixed date on

                                        6

<PAGE>

which an amount equal to the Principal Amount of such Note or such installment
of semi-annual or contingent interest is due and payable.

          "Tax Event" means that the Company shall have received an opinion from
           ---------
independent tax counsel experienced in such matters to the effect that, on or
after October 4, 2001, as a result of:

          (1) any amendment to, or change (including any announced prospective
     change) in, the laws, rules or regulations thereunder of the United States
     or any political subdivision or taxing authority thereof or therein, or

          (2) any amendment to, or change in, an interpretation or application
     of such laws, rules or regulations by any legislative body, court,
     governmental agency or regulatory authority,

in each case which amendment or change is enacted, promulgated, issued or
announced or which interpretation is issued or announced or which action is
taken, on or after October 4, 2001, there is more than an insubstantial risk
that interest (including Original Issue Discount or contingent interest, if any)
payable on the Notes either (i) would not be deductible on a current accrual
basis, or (ii) would not be deductible under any other method, in either case in
whole or in part, by the Company (by reason of deferral, disallowance, or
otherwise) for U.S. federal income tax purposes.

          "Tax Event Date" has the meaning specified in Section 3.9.
           --------------

          "Third Supplemental Indenture" has the meaning provided in the
           ----------------------------
Preamble.

          "Trading Day" means (x) if the applicable security is listed or
           -----------
admitted for trading on the New York Stock Exchange or another national
securities exchange, a day on which the New York Stock Exchange or other
national securities exchange is open for business or (y) if the applicable
security is quoted on the Nasdaq National Market, a day on which trades may be
made thereon or (z) 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.

          "Trustee" means the party named as such above until a successor
           -------
replaces such party in accordance with the applicable provisions of the
Indenture and thereafter means the successor serving thereunder.

          "Underwriting Agreement" means that certain underwriting agreement
           ----------------------
relating to the Notes by and among the Company, Credit Suisse First Boston
Corporation and Salomon Smith Barney Inc. dated as of October 4, 2001.

          The terms "Indenture," "Base Indenture," and "Notes" shall have the
                     ---------    --------------        -----
respective meanings set forth in the Recitals to this Third Supplemental
Indenture.

                                        7

<PAGE>

                                   ARTICLE II

                    GENERAL TERMS AND CONDITIONS OF THE NOTES

          Section 2.1 Designation and Principal Amount. There is hereby
                      --------------------------------
authorized a series of Debt Securities designated the Zero-Coupon Convertible
Senior Notes Due October 10, 2021, limited (except as otherwise provided in
Article II of the Base Indenture) in aggregate Principal Amount to
$1,000,756,000. The Notes may be issued from time to time upon written order of
the Company for the authentication and delivery of Notes pursuant to Section
2.05 of the Base Indenture.

          Section 2.2 Maturity. The date upon which the Notes shall become due
                      --------
and payable at final maturity, together with unpaid interest is October 10,
2021.

          Section 2.3 Form. The Notes shall be Registered Securities. The
                      ----
certificates for the Notes shall be in substantially the form attached hereto as
Exhibit A. The Notes are being offered and sold by the Company pursuant to the
Underwriting Agreement.

          Section 2.4 Global Securities. (a) The Notes will be issued initially
                      -----------------
in the form of one or more Global Securities registered in the name of the
Depositary or its nominee.

                                  ARTICLE III

                           REDEMPTION AND CONVERSIONS

          Section 3.1 Optional Redemption by the Company. (a) Right to Redeem;
                      ----------------------------------      ---------------
Notice to Trustee. The Company, at its option, may redeem the Notes in
-----------------
accordance with the provisions of paragraphs 6 and 8 of the Notes. If the
Company elects to redeem Notes pursuant to paragraph 6 of the Notes, it shall
notify the Trustee in writing of the Redemption Date, the Principal Amount of
Notes to be redeemed, the Redemption Price and the amount of contingent
interest, if any, payable on the Redemption Date. The Company shall give the
notice to the Trustee provided for in this Section 3.1(a) at least 45 days
before the Redemption Date.

          (b) Selection of Notes to Be Redeemed. If any Note selected for
              ---------------------------------
partial redemption is thereafter surrendered for conversion in part before
termination of the conversion right with respect to the portion of the Note so
selected, the converted portion of such Note shall be deemed (so far as may be),
solely for purposes of determining the aggregate Principal Amount of Notes to be
redeemed by the Company, to be the portion selected for redemption. Notes which
have been converted during a selection of Notes to be redeemed may be treated by
the Trustee as outstanding for the purpose of such selection. Nothing in this
Section 3.1(b) shall affect the right of any Holder to convert any Note pursuant
to Sections 3.5, 3.6 and 3.7 before the termination of the conversion right with
respect thereto.

          (c) Notice of Redemption. At least 30 days but not more than 60 days
              --------------------
before a Redemption Date, the Company shall provide notice of redemption to each
Holder of Notes to be redeemed.

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

                                        8

<PAGE>

          (i)    the Redemption Date;

          (ii)   the Redemption Price and, to the extent known at the time of
     such notice, the amount of contingent interest, if any, payable on the
     Redemption Date;

          (iii)  the then current Conversion Rate;

          (iv)   the name and address of the Paying Agent and the Conversion
     Agent;

          (v)    that Notes called for redemption must be presented and
     surrendered to the Paying Agent to collect the Redemption Price and
     contingent interest, if any;

          (vi)   that the Notes called for redemption may be converted at any
     time before the close of business on the Redemption Date;

          (vii)  that Holders who wish to convert Notes must comply with the
     procedures in paragraph 9 of the Notes;

          (viii) that, unless the Company defaults in making payment of such
     Redemption Price and contingent interest, if any, Original Issue Discount
     and interest (including contingent interest), if any, on the Notes called
     for redemption will cease to accrue on and after the Redemption Date and
     the only remaining right of the Holder will be to receive payment of the
     Redemption Price upon presentation and surrender to the Paying Agent of the
     Notes;

          (ix)   if fewer than all the outstanding Notes are to be redeemed, the
     certificate number and Principal Amounts of the particular Notes to be
     redeemed;

          (x)    the CUSIP number or numbers for the Notes called for
     redemption; and

          (xi)   the election of the Company (which, subject to the provisions
     of Sections 3.6, 3.7 and 3.8, shall be irrevocable) to deliver shares of
     Common Stock or to pay cash in lieu of delivery of such shares with respect
     to any Notes that may converted after the mailing of such notice and prior
     to the Redemption Date.

          At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense.

          (d) Effect of Notice of Redemption. Once notice of redemption is
              ------------------------------
given, Notes called for redemption become due and payable on the Redemption Date
and at the Redemption Price (together with accrued and unpaid contingent
interest, if any) stated in the notice, except for Notes that are converted in
accordance with the provisions of Sections 3.6, 3.7 and 3.8. Upon presentation
and surrender to the Paying Agent, Notes called for redemption shall be paid at
the Redemption Price (together with accrued and unpaid contingent interest, if
any).

          (e) Sinking Fund. There shall be no sinking fund provided for the
              ------------
Notes.

                                       9

<PAGE>

          (f) Deposit of Redemption Price. On or before 11:00 a.m. (New York
                     ---------------------------
City time) on the Redemption Date, the Company shall deposit with the Trustee or
with the Paying Agent (or, if the Company or an Affiliate of the Company is
acting as the Paying Agent, shall segregate and hold in trust) an amount of
money sufficient to pay the aggregate Redemption Price of, and any accrued and
unpaid contingent interest with respect to, all the Notes to be redeemed on that
date other than the Notes or portions thereof called for redemption which on or
prior thereto have been delivered by the Company to the Trustee for cancellation
or have been converted. The Trustee and the Paying Agent shall, as promptly as
practicable, return to the Company any money not required for that purpose
because of conversion of the Notes in accordance with the provisions of Sections
3.6, 3.7 and 3.8. If such money is then held by the Company or a Subsidiary in
trust and is not required for such purpose, it shall be discharged from such
trust.

          Section 3.2 Purchase at Option of the Holder upon a Fundamental
                      ---------------------------------------------------
Change. (a) If a Fundamental Change shall occur at any time prior to October 10,
------
2003, each Holder of Notes shall have the right, at such Holder's option, to
require the Company to purchase such Holder's Notes on the date (the
"Fundamental Change Purchase Date") (or if such date is not a business day, the
 --------------------------------
next succeeding business day) that is 35 business days after the date of the
Fundamental Change. The Notes shall be purchased in integral multiples of $1,000
of Principal Amount. The Company shall purchase such Notes for Cash at a price
per Note (the "Fundamental Change Purchase Price") equal to the Accreted Value
               ---------------------------------
on the Fundamental Change Purchase Date as set forth in Section 3.4. No Notes
may be purchased at the option of the Holders due to a Fundamental Change if
there has occurred and is continuing an Event of Default other than an Event of
Default that is cured by the payment of the Purchase Price of all such Notes.

          (b) The Company, or at its request (which must be received by the
Trustee at least three business days (or such lesser period as agreed to by the
Trustee) prior to the date the Trustee is requested to give such notice as
described below) the Trustee in the name of and at the expense of the Company,
shall mail to all Holders of record of the Notes a notice (a "Fundamental Change
                                                              ------------------
Notice") of the occurrence of a Fundamental Change and of the purchase right
------
arising as a result thereof, on or before the 20/th/ business day after the
occurrence of such Fundamental Change.

          The Fundamental Change Notice shall state:

          1.  briefly, the events causing a Fundamental Change and the date of
              such Fundamental Change;

          2.  the date by which the Fundamental Change Purchase Notice pursuant
              to this Section 3.2 must be given;

          3.  the Fundamental Change Purchase Date;

          4.  the Fundamental Change Purchase Price;

          5.  the name and address of the Paying Agent and the Conversion
              Agent;

                                       10

<PAGE>

     6.   the Conversion Rate and any adjustments thereto applicable on the
          Fundamental Change Notice Date;

     7.   that Notes as to which a Fundamental Change Purchase Notice has been
          given may be converted pursuant to Sections 3.6, 3.7 and 3.8 of the
          Third Supplemental Indenture only if the applicable Fundamental Change
          Purchase Notice has been withdrawn in accordance with the terms of
          this Indenture;

     8.   that Notes must be surrendered to the Paying Agent for cancellation to
          collect payment of the Fundamental Change Purchase Price;

     9.   that the Fundamental Change Purchase Price for any Note as to which a
          Fundamental Change Purchase Notice has been duly given and not
          withdrawn will be paid promptly following the later of the Fundamental
          Change Purchase Date and the time of surrender of such Note as
          described in (8);

     10.  briefly, the procedures the Holder must follow to exercise rights
          under this Section 3.2;

     11.  briefly, the conversion rights of the Notes;

     12.  the procedures for withdrawing a Fundamental Change Purchase Notice;

     13.  that, unless the Company defaults in making payment of such
          Fundamental Change Purchase Price, Original Issue Discount and
          interest, if any, on Notes covered by any Fundamental Change Purchase
          Notice (or interest, if the Notes have been converted into Cash Pay
          notes pursuant to Section 3.9 of this Third supplemental Indenture, if
          any) will cease to accrue on and after the Fundamental Change Purchase
          Date; and

     14.  the CUSIP number or ISIN number of the Notes; and

     15.  the procedures for withdrawing a Fundamental Change Purchase Notice.

     The Company shall promptly furnish to the Trustee a copy of such notice.

     (c) For a Note to be so purchased at the option of the Holder, the Paying
Agent must receive such Note duly endorsed for transfer, together with the form
entitled "Fundamental Change Purchase Notice" (the "Fundamental Change Purchase
                                                    ---------------------------
Notice") on the reverse thereof duly completed, prior to the close of business
------
on the Fundamental Change Purchase Date; provided, however, if the Notes are in
book-entry form such transfer shall be made in accordance with the customary
practices of the Depositary.

     All questions as to the validity, eligibility (including time of receipt)
and acceptance of any Note for purchase shall be determined by the Company,
whose determination shall be final and binding.

                                       11

<PAGE>
                  The Company shall purchase from the Holder thereof, pursuant
to this Section 3.2, a portion of a Note if the Principal Amount of such portion
is $1,000 or a multiple of $1,000 if so requested by the Holder. Provisions of
this Third Supplemental Indenture that apply to the purchase of all of a Note
also apply to the purchase of such portion of such Note.

                  Any purchase by the Company contemplated pursuant to the
provisions of this Section 3.2 shall be consummated by the delivery of the
consideration to be received by the Holder promptly following the later of the
Fundamental Change Purchase Date and the time of delivery or book-entry transfer
of the Note.

                  Notwithstanding anything herein to the contrary, any Holder
delivering to the Paying Agent the Fundamental Change Purchase Notice
contemplated by this Section 3.2 shall have the right at any time prior to the
close of business on the Fundamental Change Purchase Date to withdraw such
Fundamental Change Purchase Notice (in whole or in part) by delivery of a
written notice of withdrawal to the Paying Agent in accordance with Section
3.5(a).

                  The Paying Agent shall promptly notify the Company of the
receipt by it of any Fundamental Change Purchase Notice or written notice of
withdrawal thereof.

                  Section 3.3 Purchase of Notes at the Option of the Holder;
                              ----------------------------------------------
Payment of Purchase Price in Stock.
-----------------------------------

                  (a) Purchase of Notes at the Option of the Holder. A Holder
                      ---------------------------------------------
of Notes shall have the option to require the Company to purchase any of such
Holder's Notes, on each of October 10, 2003, October 10, 2004, October 10, 2006,
October 10, 2011 and October 10, 2016 (each, a "Purchase Date"), at the purchase
                                                -------------
price specified in paragraph 7 of the Notes (each, a "Purchase Price"), upon:
                                                      --------------

                  (1) delivery to the Paying Agent by the Holder of a written
         notice of purchase (a "Purchase Notice") at any time from the opening
                                ---------------
         of business on the date that is 30 business days prior to a Purchase
         Date until the close of business on such Purchase Date, stating:

                      (i)     if certificated, the certificate numbers of the
                  Notes which the Holder shall deliver to be purchased;

                      (ii)    the portion of the Principal Amount of the Notes
                  which the Holder shall deliver to be purchased, which portion
                  must be $1,000 in Principal Amount or a multiple thereof;

                      (iii)   that such Notes shall be purchased as of the
                  Purchase Date pursuant to the terms and conditions specified
                  in paragraph 7 of the Notes and in this Third Supplemental
                  Indenture; and

                      (iv)    if the Company elects, pursuant to a Company
                  Notice, to pay the Purchase Price to be paid as of such
                  Purchase Date, in whole or in part, in Common Stock but such
                  portion of the Purchase Price shall ultimately be payable to
                  such Holder in Cash because any of the conditions to the
                  payment of the

                                       12

<PAGE>
     Purchase Price in Common Stock are not satisfied prior to or on the
     Purchase Date, as set forth in Section 3.3(e), whether such Holder elects
     (x) to withdraw such Purchase Notice as to some or all of the Notes to
     which such Purchase Notice relates (stating the Principal Amount and
     certificate numbers, if the Notes are in certificated form, of the Notes as
     to which such withdrawal shall relate), or (y) to receive Cash in respect
     of the entire Purchase Price for all Notes (or portions thereof) to which
     such Purchase Notice relates; and

     (2) delivery or book-entry transfer of such Note to the Paying
  Agent prior to, on or after the Purchase Date (together with all necessary
  endorsements) at the offices of the Paying Agent, such delivery or transfer
  being a condition to receipt by the Holder of the Purchase Price therefor;
  provided, however, that such Purchase Price shall be so paid pursuant to this
  Section 3.3 only if the Note so delivered or transferred to the Paying Agent
  shall conform in all respects to the description thereof in the related
  Purchase Notice.

     (b) Procedures. (a) If a Holder, in such Holder's Purchase Notice (and in
         ----------
any written notice of withdrawal of a portion of a Holder's Notes previously
submitted for purchase pursuant to a Purchase Notice, the portion that remains
subject to the Purchase Notice), fails to indicate such Holder's choice with
respect to the election regarding a conditional withdrawal pursuant to the terms
of clause (iv) of Section 3.3(a)(1), such Holder shall be deemed to have elected
to receive Cash in respect of all Notes subject to such Purchase Notice in the
circumstances set forth in such clause (iv).

     The Company shall purchase from the Holder thereof, pursuant to this
Section 3.3, a portion of a Note if the Principal Amount of such portion is
$1,000 or a multiple of $1,000 if so requested by the Holder. Provisions of
this Third Supplemental Indenture that apply to the purchase of all of a Note
also apply to the purchase of such portion of such Note.

     Any purchase by the Company contemplated pursuant to the provisions of this
Section 3.3 shall be consummated by the delivery of them consideration to be
received by the Holder (together with accrued and unpaid contingent interest, if
any) promptly following the later of the Purchase Date and the time of delivery
or book-entry transfer of the Note.

     Notwithstanding anything herein to the contrary, any Holder delivering to
the Paying Agent the Purchase Notice contemplated by this Section 3.3(b) shall
have the right at any time prior to the close of business on the Purchase Date
to withdraw such Purchase Notice (in whole or in part) by delivery of a written
notice of withdrawal to the Paying Agent in accordance with Section 3.5(a).

     The Paying Agent shall promptly notify the Company of the receipt by it of
any Purchase Notice or written notice of withdrawal thereof.

     (c) Company's Right to Elect Manner of Payment of Purchase Price.  The
         ------------------------------------------------------------
Company may elect with respect to any Purchase Date to pay the Purchase Price in
respect of the Notes to be purchased pursuant to Section 3.3(a) as of such
Purchase Date, in U.S. legal tender ("Cash") or Common Stock, or in any
                                      ----
combination of Cash and Common Stock, subject to the

                                       13

<PAGE>

conditions set forth in Section 3.3(d) and (e); provided, however, that any
Purchase Price paid on October 10, 2003 pursuant to Section 3.3(a) must be paid
fully in Cash. The Company shall designate, in the Company Notice delivered
pursuant to Section 3.3(f), whether the Company shall purchase the Notes for
Cash or Common Stock, or, if a combination thereof, the percentages of the
Purchase Price of Notes in respect of which it shall pay in Cash and/or Common
Stock; provided that the Company shall pay Cash for fractional interests in
Common Stock. For purposes of determining the existence of potential fractional
interests, all Notes subject to purchase by the Company held by a Holder shall
be considered together (no matter how many separate certificates are to be
presented). Each Holder whose Notes are purchased pursuant to this Section 3.3
shall receive the same percentage of Cash and/or Common Stock in payment of the
Purchase Price for such Notes, except (i) as provided in Section 3.3(e) with
regard to the payment of Cash in lieu of fractional interests in Common Stock
and (ii) in the event that the Company is unable to purchase the Notes of a
Holder or Holders for Common Stock because any necessary qualifications or
registrations of the Common Stock under applicable federal or state securities
laws cannot be obtained, the Company may purchase the Notes of such Holder or
Holders for Cash. Once the Company has given its Company Notice to Holders, the
Company may not change its election with respect to the consideration (or
components or percentages of components thereof) to be paid except pursuant to
this Section 3.3(c) or Section 3.3(e).

                  At least five business days before the Company Notice Date,
the Company shall deliver an Officers' Certificate to the Trustee specifying:

                  (i)      the manner of payment selected by the Company;

                  (ii)     the information required by Section 3.3(f);

                  (iii)    if the Company elects to pay the Purchase Price, or a
         specified percentage thereof, in Common Stock, that the conditions to
         such manner of payment set forth in Section 3.3(e) have been or shall
         be complied with; and

                  (iv)     whether the Company desires the Trustee to give the
         Company Notice required by Section 3.3(f).

                  (d)      Purchase with Cash. On the initial Purchase Date, the
                           ------------------
Purchase Price of all Notes in respect of which a Purchase Notice pursuant to
Section 3.3(a) has been given shall be paid by the Company with cash equal to
the aggregate Purchase Price of such Notes. On each other Purchase Date, at the
option of the Company, the Purchase Price in respect of which a Purchase Notice
pursuant to Section 3.3(a) has been given, or a specified percentage thereof,
may be paid by the Company with Cash equal to the aggregate Purchase Price, or
such specified percentage thereof, as the case may be, of such Notes.

                  (e)      Payment by Issuance of Common Stock. On each Purchase
                           -----------------------------------
Date other than initial one, at the option of the Company, subject to Section
3.3(c), the Purchase Price of Notes in respect of which a Purchase Notice
pursuant to Section 3.3(a) has been given, or a specified percentage thereof,
may be paid by the Company by the issuance of a number of shares of Common Stock
equal to the quotient obtained by dividing (x) the amount of Cash to which the

                                       14

<PAGE>
Holders would have been entitled had the Company elected to pay all or such
specified percentage, as the case may be, of the Purchase Price of such Notes in
Cash by (y) the Market Price of a share of Common Stock, subject to the next
succeeding paragraph.

     The Company shall not issue a fractional share of Common Stock in payment
of the Purchase Price. Instead the Company shall pay Cash for the current market
value of the fractional share. The current market value of a fraction of a share
shall be determined by multiplying the Market Price by such fraction and
rounding the product to the nearest whole cent. It is understood that if a
Holder elects to have more than one Note purchased, the number of shares of
Common Stock shall be based on the aggregate amount of Notes to be purchased.

     The Company's right to exercise its election to purchase the Notes pursuant
to Section 3.3 through the issuance of shares of Common Stock shall be
conditioned upon:

          (i)   the Company having given timely notice in accordance with
     Section 3.3(f) of its election to purchase all or a specified percentage of
     the Notes with Common Stock as provided herein;

          (ii)  the shares of Common Stock having been admitted for listing or
     admitted for listing subject to notice of issuance on the United States
     national securities exchange on which the Common Stock is then listed on
     or, if the Common Stock is not then listed on a national securities
     exchange, having been approved for trading on the Nasdaq National Market;

          (iii) (A)(1) the registration of the shares of Common Stock to be
     issued in respect of the payment of the specified percentage of the
     Purchase Price under the Securities Act of 1933 or (2) the issuanceof the
     shares of Common Stock in a transaction which is exempt from the
     registration requirements of the Securities Act of 1933 and which will not
     result in such shares of Common Stock being deemed "restricted securities"
     under the Securities Act of 1933 or otherwise and (B) the registration of
     the shares of Common Stock under the Exchange Act, to the extent required
     thereby;

          (iv)  any necessary qualification or registration under applicable
     state securities laws or the availability of an exemption from such
     qualification and registration; and

          (v)   the receipt by the Trustee of an Officers' Certificate and an
     Opinion of Counsel each stating that (A) the terms of the issuance of the
     Common Stock are in conformity with this Third Supplemental Indenture and
     (B) the shares of Common Stock to be issued by the Company in payment of
     the specified percentage of the Purchase Price in respect of Notes have
     been duly authorized and, when issued and delivered pursuant to the terms
     of this Third Supplemental Indenture in payment of the specified percentage
     of the Purchase Price in respect of Notes, shall be validly issued, fully
     paid and nonassessable, and, to the best of such counsel's knowledge, free
     from preemptive rights, and in the case of such Officers' Certificate,
     stating that conditions (i), (ii), (iii) and (iv) above have been

                                       15

<PAGE>

          satisfied and, in the case of such Opinion of Counsel, stating that
          condition (iii) has been satisfied.

          Such Officers' Certificate shall also set forth the number of shares
of Common Stock to be issued for each $1,000 Principal Amount of Notes and the
Sale Price of a share of Common Stock on each Trading Day during the period
during which the Market Price is calculated and ending on the Purchase Date. The
Company may elect to pay the Purchase Price (or any portion thereof) in Common
Stock only if the information necessary to calculate the Market Price is
publicly reported. If any of the conditions set forth in this Section 3.3(e) are
not satisfied with respect to a Holder or Holders prior to or on the Purchase
Date and the Company elected to purchase the Notes to be purchased as of such
Purchase Date pursuant to this Section 3.3 through the issuance of shares of
Common Stock, the Company shall pay the entire Purchase Price in respect of such
Notes of such Holder or Holders in Cash.

          Upon determination of the actual number of shares of Common Stock
which the Holder of each $1,000 Principal Amount of the Notes shall receive, the
Company shall provide notice of such determination.

          (f)  Notice of Election. The Company's notices of election to purchase
               ------------------
with Cash or Common Stock, or any combination thereof (each, a "Company
                                                                -------
Notice"), shall be sent to the Holders (and to beneficial owners if required by
------
applicable law) at their addresses shown in the Note register maintained by the
Registrar, and delivered to the Trustee, not less than 30 business days prior to
the Purchase Date (the "Company Notice Date"). Such Company Notices shall state
                        -------------------
the manner of payment elected and shall contain the following information.

          In the event the Company has elected to pay a Purchase Price (or a
specified percentage thereof) with Common Stock, the Company Notice shall:

               (i)   state that each Holder shall receive Common Stock in
          respect of the specified percentage of the Purchase Price of the Notes
          held by such Holder (except any Cash amount to be paid in lieu of
          fractional shares);

               (ii)  state that the total number of shares of Common Stock to be
          issued to Holders will be equal to the quotient obtained by dividing
          (x) the amount of cash to which the Holders would have been entitled
          had the Company elected to pay all or such specified percentage, as
          the case may be, of the Purchase Price of such Notes in cash by (y)
          the Market Price of a share of Common Stock;

               (iii) set forth the method of calculating the Market Price of
          the Common Stock; and

               (iv)  state that because the Market Price of Common Stock will be
          determined prior to the Purchase Date, Holders will bear the market
          risk with respect to the value of the Common Stock to be received from
          the date such Market Price is determined to the Purchase Date.

          In any case, each Company Notice shall include a form of Purchase
Notice to be completed by a Holder and shall state:

                                       16

<PAGE>

          (i)    the Purchase Price, the Conversion Rate and, to the extent
     known at the time of such notice, the amount of contingent interest, if
     any, that will be payable with respect to the Notes on the Purchase Date;

          (ii)   the name and address of the Paying Agent and the Conversion
     Agent;

          (iii)  that Notes as to which a Purchase Notice has been given may be
     converted only if the applicable Purchase Notice has been withdrawn in
     accordance with the terms of this Third Supplemental Indenture;

          (iv)   that Notes must be surrendered to the Paying Agent to collect
     payment of the Purchase Price and contingent interest, if any;

          (v)    that the Purchase Price for any Note as to which a Purchase
     Notice has been given and not withdrawn, together with any accrued
     contingent interest payable with respect thereto, shall be paid promptly
     following the later of the Purchase Date and the time of surrender of such
     Note as described in (iv);

          (vi)   the procedures the Holder must follow under Section 3.3;

          (vii)  briefly, the conversion rights of the Notes;

          (viii) that, unless the Company defaults in making payment of such
     Purchase Price and contingent interest, if any, Original Issue Discount and
     interest (including contingent interest), if any, on Notes covered by any
     Purchase Notice (or interest, if the Notes have been converted into Cash
     Pay Notes pursuant to Section 3.9 of this Third Supplemental Indenture, if
     any) will cease to accrue on and after the Purchase Date;

          (ix)   the CUSIP or ISIN number of the Notes; and

          (x)    the procedures for withdrawing a Purchase Notice (including,
     without limitation, for a conditional withdrawal pursuant to the terms of
     Section 3.3(a)(1)(iv).

     At the Company's request and at the Company's expense, the Trustee shall
give the Company Notice in the Company's name; provided, however, that, in all
cases, the text of the Company Notice shall be prepared by the Company.

     (g)  Covenants of the Company. All shares of Common Stock delivered upon
          ------------------------
conversion or purchase of the Notes shall be newly issued shares or treasury
shares, shall be fully paid and nonassessable and shall be free from preemptive
rights and free of any lien or adverse claim.

     The Company shall cause to have listed or quoted all such shares of Common
Stock on each United States national securities exchange or over-the-counter or
other domestic market on which the Common Stock is then listed or quoted.

                                       17

<PAGE>

          (h) Taxes. If a Holder of a Note is paid in Common Stock, the Company
              -----
shall pay any documentary, stamp or similar issue or transfer tax due on such
issue of shares of Common Stock. However, the Holder shall pay any such tax
which is due because the Holder requests the shares of Common Stock to be issued
in a name other than the Holder's name. The Paying Agent may refuse to deliver
the certificates representing the Common Stock being issued in a name other than
the Holder's name until the Paying Agent receives a sum sufficient to pay any
tax which shall be due because the shares of Common Stock are to be issued in a
name other than the Holder's name. Nothing herein shall preclude any income tax
withholding required by law or regulations.

          Section 3.4 Deposit of Purchase Price or Fundamental Change Purchase
                      --------------------------------------------------------
Price. On or before 11:00 a.m. (New York City time) on the Purchase Date or
-----
Fundamental Change Purchase Date, the Company shall deposit with the Trustee or
with the Paying Agent Cash (or, if the Company or an Affiliate of the Company is
acting as Paying Agent, shall segregate and hold in trust an amount of Cash) in
respect of a Cash purchase under Section 3.3(d) or for fractional interests or
contingent interest, as applicable, or shares of Common Stock, or a combination
thereof, as applicable, sufficient to pay the aggregate Purchase Price or
Fundamental Change Purchase Price of, and any accrued and unpaid interest with
respect to, all Notes or portions thereof to be purchased pursuant to Section
3.2 or 3.3. Payment of the Purchase Price or Fundamental Change Purchase Price
for such Note shall be made as soon as practicable following the later of the
Purchase Date or Fundamental Change Purchase Date or the time of book-entry
transfer or delivery of such Note. If the Company is delivering Common Stock,
the Company shall deliver to each Holder entitled to receive Common Stock,
through the Paying Agent, a certificate for the number of full shares of Common
Stock, as applicable, issuable in payment of such Purchase Price and Cash in
lieu of any fractional interests. The Person in whose name the certificate for
Common Stock is registered shall be treated as a holder of record following the
Purchase Date. Subject to Section 3.3(e), no payment or adjustment shall be made
for dividends on the Common Stock in respect of a Common Stock Record Date for
which occurred on or prior to the Purchase Date. If the Paying Agent holds, in
accordance with the terms of the Indenture, money or securities sufficient to
pay the Purchase Price or Fundamental Change Purchase Price of such Note on the
business day following the Purchase Date or Fundamental Change Purchase Date,
then, on and after such date, such Note shall cease to be outstanding and
Original Issue Discount on such Note shall cease to accrue, whether or not
book-entry transfer of such Note is made or such Note is delivered to the Paying
Agent, and all other rights of the Holder shall terminate (other than the right
to receive the Purchase Price or Fundamental Change Purchase Price upon delivery
or transfer of the Note).

          Section 3.5 Further Conditions for Purchase at the Option of Holders
                      --------------------------------------------------------
upon a Fundamental Change and Purchase of Notes at the Option of the Holder.
---------------------------------------------------------------------------

          (a) Effect of Purchase Notice or Fundamental Change Purchase Notice.
              ---------------------------------------------------------------
Upon receipt by the Company of the Purchase Notice or Fundamental Change
Purchase Notice specified in Section 3.3(a) or Section 3.2(b), as applicable,
the Holder of the Note in respect of which such Purchase Notice or Fundamental
Change Purchase Notice, as the case may be, was given shall (unless such
Purchase Notice or Fundamental Change Purchase Notice is withdrawn as specified
in the following two paragraphs) thereafter be entitled to receive solely the
Purchase Price or Fundamental Change Purchase Price, as the case may be, and any
accrued and unpaid

                                       18

<PAGE>

contingent interest, if any, with respect to such Note. Such Purchase Price or
Fundamental Change Purchase Price and contingent interest, if any, shall be paid
to such Holder promptly following the later of (x) the Purchase Date or the
Fundamental Change Purchase Date, as the case may be, with respect to such Note
(provided the conditions in Section 3.3(a) or Section 3.2(c), as applicable,
have been satisfied) and (y) the time of delivery or book-entry transfer of such
Note to the Paying Agent by the Holder thereof in the manner required by Section
3.3(a) or Section 3.2(c), as applicable. Notes in respect of which a Purchase
Notice or Fundamental Change Purchase Notice, as the case may be, has been given
by the Holder thereof may not be converted for shares of Common Stock on or
after the date of the delivery of such Purchase Notice (or Fundamental Change
Purchase Notice, as the case may be), unless such Purchase Notice (or
Fundamental Change Purchase Notice, as the case may be) has first been validly
withdrawn as specified in the following two paragraphs.

          A Purchase Notice or Fundamental Change Purchase Notice, as the case
may be, may be withdrawn by means of a written notice of withdrawal delivered to
the office of the Paying Agent at any time prior to the close of business on the
Purchase Date or the Fundamental Change Purchase Date, as the case may be, to
which it relates specifying:

          (a) if certificated, the certificate number of the Notes in respect of
     which such notice of withdrawal is being submitted;

          (b) the Principal Amount of the Notes with respect to which such
     notice of withdrawal is being submitted; and

          (c) the Principal Amount, if any, of the Notes which remain subject to
     the original Purchase Notice or Fundamental Change Purchase Notice, as the
     case may be, and which has been or shall be delivered for purchase by the
     Company.

          A written notice of withdrawal of a Purchase Notice or Fundamental
Change Purchase Notice may be in the form of (i) a conditional withdrawal
contained in a Purchase Notice pursuant to the terms of Section 3.3(a)(1)(iv) or
(ii) a conditional withdrawal containing the information set forth in the
preceding paragraph and contained in a written notice of withdrawal delivered to
the Paying Agent as set forth in the preceding paragraph.

          There shall be no purchase of any Notes pursuant to Section 3.2 or
Section 3.3 (other than through the issuance of Common Stock in payment of the
Purchase Price, including Cash in lieu of any fractional shares) if there has
occurred prior to, on or after, as the case may be, the giving, by the Holders
of such Notes, of the required Purchase Notice (or Fundamental Change Purchase
Notice, as the case may be) and is continuing an Event of Default (other than an
Event of Default that is cured by the payment of the Purchase Price or
Fundamental Change Purchase Price, as the case may be, and any accrued and
unpaid contingent interest with respect to such Notes). The Paying Agent will
promptly return to the respective Holders thereof any Notes (x) with respect to
which a Purchase Notice or Fundamental Change Purchase Notice, as the case may
be, has been withdrawn in compliance with this Third Supplemental Indenture, or
(y) held by it during the continuance of an Event of Default (other than an
Event of Default that is cured by the payment of the Purchase Price or
Fundamental Change Purchase Price, as the case may be, and any accrued and
unpaid contingent interest with respect to such Notes) in

                                       19

<PAGE>

which case, upon such return, the Purchase Notice or Fundamental Change Purchase
Notice with respect thereto shall be deemed to have been withdrawn.

          (b) Notes Purchased in Part. Any Note that is to be purchased only in
              -----------------------
part shall be surrendered at the office of the Paying Agent (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 such Holder's attorney duly authorized in writing) and
the Company shall execute and the Trustee shall authenticate and deliver to the
Holder of such Note, without service charge, a new Note or Notes, of any
authorized denomination as requested by such Holder in aggregate Principal
Amount equal to, and in exchange for, the portion of the Principal Amount of the
Note so surrendered which is not purchased.

          (c) Covenant to Comply with Securities Laws upon Purchase of Notes. In
              --------------------------------------------------------------
connection with any offer to purchase Notes under Section 3.2 or 3.3, the
Company shall (i) comply with Rules 13e-4 and 14e-1 (which terms, as used
herein, include any successor provision thereto) under the Exchange Act, if
applicable; (ii) file the related Schedule TO (or any successor schedule, form
or report) under the Exchange Act, if applicable; and (iii) otherwise comply
with all federal and state securities laws so as to permit the rights and
obligations under Sections 3.2 and 3.3 to be exercised in the time and in the
manner specified in Sections 3.2 and 3.3.

          (d) Repayment to the Company. The Trustee and the Paying Agent shall
              ------------------------
return to the Company any Cash or shares of Common Stock that remain unclaimed
as provided in paragraph 14 of the Notes, together with interest that the
Trustee has agreed to pay, if any, or dividends, if any, paid thereon while such
shares are held by the Trustee or the Paying Agent, held by them for the payment
of a Purchase Price or Fundamental Change Purchase Price, as the case may be, or
contingent interest, if any; provided, however, that to the extent that the
aggregate amount of Cash or shares of Common Stock deposited by the Company
pursuant to Section 3.4 exceeds the aggregate Purchase Price or Fundamental
Change Purchase Price, as the case may be, of, and any accrued and unpaid
contingent interest with respect to, the Notes or portions thereof which the
Company is obligated to purchase as of the Purchase Date or Fundamental Change
Purchase Date, as the case may be, then promptly after the business day
following the Purchase Date or Fundamental Change Purchase Date, as the case may
be, the Trustee and the Paying Agent shall return any such excess to the Company
together with interest that the Trustee has agreed to pay, if any, or dividends,
if any, paid thereon while such Cash or shares are held by the Trustee or the
Paying Agent.

          Section 3.6 Conversion of Notes. (a) Right to Convert. A Holder of
                      -------------------      ----------------
a Note may convert such Note into Common Stock at any time during which the
conditions stated in paragraph 9 of the Notes are met. The number of shares of
Common Stock issuable upon conversion of a Note per $1,000 of Principal Amount
(the "Conversion Rate") shall be that set forth in paragraph 9 in the Notes,
      ---------------
subject to adjustment as herein set forth.

          A Holder may convert a portion of the Principal Amount of a Note if
the portion is $1,000 or a multiple of $1,000. Provisions of this Third
Supplemental Indenture that apply to conversion of all of a Note also apply to
conversion of a portion of a Note.

                                       20

<PAGE>

          The Holders' right to convert Notes into shares of Common Stock is
subject to the Company's right to elect instead to pay such Holder the amount of
cash set forth in this Section 3.6(b), in lieu of delivering such shares of
Common Stock; provided, however, that if an Event of Default (other than a
default in a cash payment upon conversion of the Notes) shall have occurred
(prior to, on or after, as the case may be, the Conversion Date or the date on
which the Company delivers its notice of whether such Note shall be converted
into shares of Common Stock or cash pursuant to Section 3.6(b and be continuing,
the Company shall deliver shares of Common Stock (and cash in lieu of fractional
shares of Common Stock) in accordance with this Article III, whether or not the
Company has delivered a notice pursuant to Section 3.1(c) or this Section 3.6(b)
to the effect that the Notes would be paid in cash. The amount of cash to be
paid pursuant to this Section 3.6(b) hereof for each $1,000 of principal amount
of a Note upon conversion shall be equal to the average Sale Price of the Common
Stock for the five consecutive Trading Days immediately following (i) the date
of the Company's notice of its election to deliver cash upon conversion, if the
Company shall not have given a notice of redemption pursuant to Section 3.1(c),
or (ii) the Conversion Date, in the case of a conversion following such a notice
of redemption specifying an intent to deliver cash upon conversion, in either
case multiplied by the Conversion Rate in effect on such Conversion Date.

          (b)   Conversion Procedures. To convert a Note a Holder must satisfy
                ---------------------
the requirements in paragraph 9 of the Notes. The date on which the Holder of
Notes satisfies all those requirements is the conversion date (the "Conversion
                                                                    ----------
Date"). The Conversion Agent shall notify the Company of the Conversion Date
----
within one business day of the Conversion Date. Within two business days
following the Conversion Date, the Company shall deliver to the Holder, through
the Conversion Agent, written notice of whether such Note shall be converted
into shares of Common Stock or paid in cash, unless the Company shall have
delivered such notice previously pursuant to Section 3.1(c). If the Company
shall have notified the Holder that all of such Note shall be converted into
shares of Common Stock, the Company shall deliver to the Holder through the
Conversion Agent, as promptly as practicable but in any event no later than the
fifth business day following the date of the Company's notice of its election to
deliver shares of Common Stock, a certificate for the number of full shares of
Common Stock deliverable upon the conversion and cash in lieu of any fractional
share determined pursuant to Section 3.6(c) hereof. Except as provided in the
last sentence in the second paragraph of Section 3.6(a) hereof, if the Company
shall have notified the Holder that all or a portion of such Note shall be paid
in cash, the Company shall deliver to the Holder surrendering such Note the
amount of cash payable with respect to such Note no later than the tenth
business day following such Conversion Date, together with a certificate for the
number of full shares of Common Stock deliverable upon the conversion and cash
in lieu of any fractional share determined pursuant to Section 3.6(c) hereof.
Except as provided in the last sentence in the second paragraph of Section
3.6(a) hereof, the Company may not change its election with respect to the
consideration to be delivered upon conversion of a Note once the Company has
notified the Holder in accordance with this paragraph. If shares of Common Stock
are delivered as consideration, then the Person in whose name the certificate
representing such shares is registered shall be treated as a stockholder of
record on and after the Conversion Date; provided, however, that no surrender of
a Note on any date when the stock transfer books of shall be closed shall be
effective to constitute the Person or Persons entitled to receive the shares of
Common Stock upon such conversion as the record holder or holders of such shares
of Common Stock on such date, but such surrender shall be effective to
constitute the Person or Persons entitled to receive such

                                       21

<PAGE>

shares of Common Stock as the record holder or holders thereof for all purposes
at the close of business on the next succeeding day on which such stock transfer
books are open; such conversion shall be at the Conversion Rate in effect on the
date that such Note shall have been surrendered for conversion, as if the stock
transfer books of had not been closed. Upon conversion of a Note, such Person
shall no longer be a Holder of such Note and such Note shall be cancelled and no
longer Outstanding.

          No payment or adjustment shall be made for dividends on or other
distributions with respect to any Common Stock except as provided in Section
3.7. On conversion of a Note, that portion of Accreted Value (or interest, if
the Company has exercised its option to convert the Notes to Cash Pay Notes
pursuant to Section 3.9) attributable to the period from the Issue Date of the
Note to the Conversion Date and accrued contingent interest with respect to the
converted Note shall not be canceled, extinguished or forfeited, but rather
shall be deemed to be paid in full to the Holder thereof through delivery of the
Common Stock (together with the Cash payment, if any, in lieu of fractional
shares) in exchange for the Note being converted.

          If a Holder converts more than one Note at the same time, the number
of shares of Common Stock issuable upon the conversion shall be based on the
total Principal Amount of the Notes converted.

          Upon surrender of a Note that is converted in part, the Company shall
execute, and the Trustee shall authenticate and deliver to the Holder, a new
Note in an authorized denomination equal in Principal Amount (or the Restated
Principal Amount, if applicable) to the unconverted portion of the Note
surrendered.

          If the last day on which a Note may be converted is a legal holiday in
a place where a Conversion Agent is located, the Note may be surrendered to that
Conversion Agent on the next succeeding day that it is not a legal holiday.

          (c)   Cash Payments in Lieu of Fractional Shares. The Company shall
                ------------------------------------------
not issue a fractional share of Common Stock upon conversion of a Note. Instead
the Company shall deliver Cash for the current market value of the fractional
share. The current market value of a fractional share shall be determined to the
nearest 1/10,000th of a share by multiplying the Sale Price of a full share of
Common Stock on the Trading Day immediately preceding the Conversion Date by the
fractional amount and rounding the product to the nearest whole cent.

          (d)   Taxes on Conversion. If a Holder converts a Note, the Company
                -------------------
shall pay any documentary, stamp or similar issue or transfer tax due on the
issue of shares of Common Stock upon the conversion. However, the Holder shall
pay any such tax which is due because the Holder requests the shares to be
issued in a name other than the Holder's name. The Conversion Agent may refuse
to deliver the certificates representing the Common Stock being issued in a name
other than the Holder's name until the Conversion Agent receives a sum
sufficient to pay any tax which shall be due because the shares are to be issued
in a name other than the Holder's name. Nothing herein shall preclude any tax
withholding required by law or regulations.

                                       22

<PAGE>

          (e)   Company to Provide Stock. The Company shall, prior to issuance
                ------------------------
of any Notes hereunder, and from time to time as may be necessary, reserve out
of its authorized but unissued Common Stock a sufficient number of shares of
Common Stock to permit the conversion of the Notes.

          All shares of Common Stock delivered upon conversion of the Notes
shall be newly issued shares or treasury shares, shall be duly and validly
issued and fully paid and nonassessable and shall be free from preemptive rights
and free of any lien or adverse claim.

          The Company shall endeavor promptly to comply with all federal and
state securities laws regulating the order and delivery of shares of Common
Stock upon the conversion of Notes, if any, and shall cause to have listed or
quoted all such shares of Common Stock on each United States national securities
exchange or over-the-counter or other domestic market on which the Common Stock
is then listed or quoted.

          Section 3.7   Adjustments to Conversion Rate.  The Conversion Rate
                        ------------------------------
shall be adjusted from time to time by the Company as follows:

          (a)   In case the Company shall (i) pay a dividend, or make a
     distribution, in shares of Common Stock or other Capital Stock, on Common
     Stock; (ii) subdivide its outstanding Common Stock into a greater number of
     shares; or (iii) combine its outstanding Common Stock into a smaller number
     of shares, the Conversion Rate in effect immediately prior thereto shall be
     adjusted so that the holder of any Note thereafter surrendered for
     conversion shall be entitled to receive the number of shares of Common
     Stock which such holder would have owned or have been entitled to receive
     after the happening of any of the events described above had such Note been
     converted immediately prior to the happening of such event. An adjustment
     made pursuant to this Section 3.7 shall become effective immediately after
     the Common Stock Record Date in the case of a dividend or distribution and
     shall become effective immediately after the effective date in the case of
     subdivision, combination or reclassification. If any dividend or
     distribution of the type described in clause (i) above is not so paid or
     made, the Conversion Rate shall again be adjusted to the Conversion Rate
     which would then be in effect if such dividend, distribution had not been
     declared.

           (b)   In case the Company shall issue rights or warrants to all
     holders of its Common Stock entitling them (for a period expiring within 60
     days after the date fixed for determination of stockholders entitled to
     receive such rights or warrants) to subscribe for or purchase Common Stock
     at a price per share less than the Sale Price per share of Common Stock on
     the day preceding the date of announcement of the Common Stock Record Date
     for the determination of stockholders entitled to receive such rights or
     warrants, the Conversion Rate in effect immediately prior thereto shall be
     adjusted so that the same shall equal the Conversion Rate determined by
     multiplying the Conversion Rate in effect immediately prior to the date of
     the issuance of such rights or warrants by a fraction of which the
     numerator shall be the number of shares of Common Stock outstanding on the
     date of issuance of such rights or warrants plus the number of additional
     shares of Common Stock offered for subscription or purchase, and of which
     the denominator shall be the number of shares of Common Stock outstanding
     on the date

                                       23

<PAGE>

of issuance of such rights or warrants plus the number of shares which the
aggregate offering price of the total number of shares so offered would purchase
at such Sale Price. Such adjustment shall be made successively whenever any such
rights or warrants are issued, and shall become effective immediately after the
opening of business on the day following the Common Stock Record Date for the
determination of the stockholders entitled to receive such rights or warrants.
To the extent that shares of Common Stock are not delivered after the expiration
of such rights or warrants, the Conversion Rate shall be readjusted to the
Conversion Rate which would then be in effect had the adjustments made upon the
issuance of such rights or warrants been made on the basis of delivery of only
the number of shares of Common Stock actually delivered. If such rights or
warrants are not so issued, the Conversion Rate shall again be adjusted to be
the Conversion Rate which would then be in effect if such Common Stock Record
Date 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 shares of Common Stock at less
than such Sale Price, and in determining the aggregate offering price of such
shares of Common Stock, there shall be taken into account any consideration
received by the Company for such rights or warrants, the value of such
consideration, if other than cash, to be determined by the Board of Directors.

      (c)  In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock (excluding any distribution in connection with
the liquidation, dissolution or winding up of the Company, whether voluntary or
involuntary) any evidences of its indebtedness or assets (other than Cash) or
rights or warrants to subscribe for or purchase any of its securities (excluding
those referred to in Section 3.7(b)) (any of the foregoing hereinafter in this
Section 3.7 called the "Distributed Securities"), then, the Conversion Rate
                        ----------- ----------
shall be adjusted so that the same shall equal the Conversion Rate determined by
multiplying the Conversion Rate in effect immediately prior to the date of such
distribution by a fraction of which the numerator shall be the Market Price per
share of the Common Stock on the Common Stock Record Date mentioned below, and
the denominator shall be the Sale Price per share of the Common Stock on such
Common Stock Record Date less the Fair Market Value on such Common Stock Record
Date (as determined by the Board of Directors, whose determination shall be
conclusive, and described in a certificate filed with the Trustee) of the
Distributed Securities so distributed applicable to one share of Common Stock.
Such adjustment shall become effective immediately after the Common Stock Record
Date for the determination of stockholders entitled to receive such
distribution. Notwithstanding the foregoing, in the event (a) the then Fair
Market Value (as so determined) of the portion of the Distributed Securities so
distributed applicable to one share of Common Stock is equal to or greater than
the Market Price of the Common Stock on the Common Stock Record Date or (b) such
Market Price exceeds the Fair Market Value of such Distributed Securities by
less than $1.00, in lieu of the foregoing adjustment, adequate provision shall
be made so that each Holder shall have the right to receive upon conversion the
amount of Distributed Securities such Holder would have received had such Holder
converted each Note immediately prior to such Common Stock Record Date. In the
event that such distribution is not so paid or made, the Conversion Rate shall
again be adjusted to the Conversion Rate which would then be in effect if such
distribution had not been declared. If the Board of Directors determines the
fair market value of any distribution for purposes

                                       24

<PAGE>

of this Section 3.7(c) by reference to the actual or when issued trading market
for any securities, it must in doing so consider the prices in such market on
the same day used in computing the Sale Price of the Common Stock.

      Notwithstanding the foregoing provisions of this Section 3.7,
no adjustment shall be made thereunder for any distribution of Distributed
Securities if the Company makes proper provision so that each Holder of a Note
who converts such Note (or any portion thereof) after the Common Stock Record
Date for such distribution shall be entitled to receive upon such conversion, in
addition to the shares of Common Stock issuable upon such conversion, the amount
and kind of Distributed Securities that such Holder would have been entitled to
receive if such Holder had, immediately prior to such Common Stock Record Date,
converted such Note into Common Stock; provided that, with respect to any
Distributed Securities that are convertible, exchangeable or exercisable, the
foregoing provision shall only apply to the extent (and so long as) the
Distributed Securities receivable upon conversion of such Note would be
convertible, exchangeable or exercisable, as applicable, without any loss of
rights or privileges for a period of at least 60 days following conversion of
such Note.

      Upon conversion of the Notes the Holders shall receive, in addition to the
Common Stock issuable upon such conversion, any rights issued under any existing
or future stockholder rights plan the Company implements (notwithstanding the
occurrence of an event causing such rights to separate from the Common Stock at
or prior to the time of conversion).

      (d)    In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock Cash (excluding any Cash that is distributed
upon a merger or consolidation to which Section 3.8(f) applies) in an aggregate
amount that, combined together with the aggregate amount of any other such
distributions to all holders of its Common Stock 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 3.7 has been made, exceeds on a
per share basis 15% of the Sale Price on the day preceding the date of
declaration of such dividend or distribution, then, and in each such case,
immediately after the close of business on such date, the Conversion Rate shall
be increased so that the same shall equal the Conversion Rate determined by
multiplying the Conversion Rate in effect immediately prior to the Common Stock
Record Date by a fraction of which the numerator shall be such Sale Price of the
Common Stock and the denominator shall be such Sale Price of the Common Stock
less the amount of Cash and the Fair Market Value (as so determined) of such
other consideration so distributed (and not excluded as provided above)
applicable to one share of Common Stock, such increase to be effective
immediately prior to the opening of business on the day following the Common
Stock Record Date; provided, however, that no adjustment will be made in respect
of any such dividends and distributions that are paid during any period for
which we are paying contingent interest to Holders; provided, further, that, if
the portion of the Cash so distributed applicable to one share of Common Stock
is equal to or greater than the Market Price of the Common Stock on the day
preceding the date of declaration of such dividend or distribution then, in lieu
of the foregoing adjustment, adequate provision shall be made so that each
Holder shall have the right to receive upon conversion, in

                                       25

<PAGE>

          addition to the shares of Common Stock, Cash and other consideration
          the Holder would have received had such Holder converted such Note
          immediately prior to such Common Stock Record Date. If such dividend
          or distribution is not so paid or made, the Conversion Rate shall
          again be adjusted to be the Conversion Rate which would then be in
          effect if such dividend or distribution had not been declared. If any
          adjustment is required to be made as set forth in this Section 3.7(d)
          as a result of a distribution that is a quarterly dividend, such
          adjustment shall be based upon the amount by which such distribution
          exceeds the amount of the quarterly cash dividend permitted to be
          excluded pursuant hereto. If an adjustment is required to be made as
          set forth in this Section 3.7(d) above as a result of a distribution
          that is not a quarterly dividend, such adjustment shall be based upon
          the full amount of the distribution.

               (e) For purposes of this Section 3.7, the number of shares of
          Common Stock at any time outstanding shall not include shares held in
          the treasury of the Company but shall include shares issuable in
          respect of scrip certificates issued in lieu of fractions of shares of
          Common Stock. The Company shall not pay any dividend or make any
          distribution on shares of Common Stock held in the treasury of the
          Company.

               Section 3.8 Miscellaneous Provisions Relating to Conversion(a).
                           --------------------------------------------------
When Adjustment May Be Deferred. No adjustment in the Conversion Rate need be
-------------------------------
made unless the adjustment would require an increase or decrease of at least 1%
in the Conversion Rate then in effect; provided that any adjustment that would
otherwise be required to be made shall be carried forward and taken into account
in any subsequent adjustment. Except as stated in Section 3.7, the Conversion
Rate will not be adjusted for the issuance of Common Stock or any securities
convertible into or exchangeable for Common Stock or carrying the right to
purchase any of the foregoing. Any adjustments that are made shall be carried
forward and taken into account any subsequent adjustment. All calculations under
Sections 3.6, 3.7 and 3.8 shall be made to the nearest cent or to the nearest
1/10,000th of a share, as the case may be.

               (b) When No Adjustment Required. No adjustment need be made for
                   ---------------------------
rights to purchase Common Stock pursuant to a Company plan for reinvestment of
dividends or interest. No adjustment need be made for a change in the par value
or no par value of the Common Stock. To the extent the Notes become convertible
into cash, assets, property or securities (other than Capital Stock of the
Company), no adjustment need be made thereafter as to the cash, assets, property
or such securities subject to Section 3.8(f). Interest shall not accrue on the
Cash.

               No adjustment need be made for a transaction referred to in
Section 3.7(a), (b), (c) or (d) if Holders are to participate in the transaction
without conversion on a basis and with notice that the Board of Directors
determines to be fair and appropriate in light of the basis and notice on which
holders of Common Stock participate in the transaction and the Holder is not
economically harmed by such transaction and the failure to make an adjustment.
Such participation by Holders may include participation in the transaction upon
conversion of their Note by the Holder provided that an adjustment shall be made
at such time as the Holder is not entitled to participate on the basis described
in the prior sentence.

                                       26

<PAGE>

               (c)   Notice of Adjustment. Whenever the Conversion Rate is
                     --------------------
adjusted, the Company shall promptly provide to Holders a notice of the
adjustment. The Company shall file with the Trustee and the Conversion Agent
such notice. The certificate shall, absent manifest error, be conclusive
evidence that the adjustment is correct. Neither the Trustee nor any Conversion
Agent shall be under any duty or responsibility with respect to any such
certificate except to exhibit the same to any Holder desiring inspection
thereof.

               (d)   Voluntary Increase. The Company may make such increases in
                     ------------------
the Conversion Rate, in addition to those required by Section 3.7, as the Board
of Directors considers to be advisable to avoid or diminish any income tax to
holders of Common Stock or rights to purchase Common Stock resulting from any
dividend or distribution of stock (or rights to acquire stock) or from any event
treated as such for income tax purposes. To the extent permitted by applicable
law, the Company may from time to time increase the Conversion Rate by any
amount for any period of time if the period is at least 20 days, the increase is
irrevocable during the period and the Board of Directors shall have made a
determination that such increase would be in the best interests of the Company,
which determination shall be conclusive. Whenever the Conversion Rate is so
increased, the Company shall mail to Holders and file with the Trustee and the
Conversion Agent a notice of such increase. Neither the Trustee nor any
Conversion Agent shall be under any duty or responsibility with respect to any
such certificate except to exhibit the same to any holder desiring inspection
thereof. The Company shall mail the notice at least 15 days before the date the
increased Conversion Rate takes affect. The notice shall state the increased
Conversion Rate and the period it shall be in effect.

               (e)   Notice to Holders Prior to Certain Actions. In case:
                     ------------------------------------------

               (i)   the Company shall declare a dividend (or any other
     distribution) on its Common Stock that would require an adjustment in the
     Conversion Rate pursuant to Section 3.7;

               (ii)  the Company shall authorize the granting to all or
     substantially all the Holders of its Common Stock of rights or warrants to
     subscribe for or purchase any Common Stock;

               (iii) of any reclassification or reorganization of the Common
     Stock of the Company (other than a subdivision or combination of its
     outstanding Common Stock, or a change in par value, or from par value to no
     par value, or from no par value to par value), or of any consolidation or
     merger to which the Company is a party and for which approval of any
     stockholders of the Company is required, or of the sale or transfer of all
     or substantially all of the assets of the Company; or

               (iv)  of the voluntary or involuntary dissolution, liquidation or
     winding-up of the Company.

the Company shall cause to be filed with the Trustee and to be provided to
Holders of Notes, as promptly as possible but in any event at least 15 days
prior to the applicable date hereinafter specified, a notice stating (x) the
date on which a record is to be taken for the purpose of such dividend,
distribution or rights or warrants, or, if a record is not to be taken, the date
as of which

                                       27

<PAGE>

the holders of Common Stock of record to be entitled to such dividend,
distribution, or rights or warrants are to be determined or (y) the date on
which such reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding-up is expected to become effective or occur, and the date
as of which it is expected that holders of Common Stock of record shall be
entitled to exchange their Common Stock for securities or other property
deliverable upon such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up. Failure to give such notice, or any
defect therein, shall not affect the legality or validity of such dividend,
distribution, reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up.

     (f) Effect of Reclassification, Consolidation, Merger or Sale. If any of
         ---------------------------------------------------------
the following events occur, namely (i) any reclassification or change of
outstanding shares of Common Stock (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); (ii) any consolidation, merger or combination of
the Company with another corporation as a result of which holders of Common
Stock shall be entitled to receive stock, securities or other property or assets
(including Cash) with respect to or in exchange for such Common Stock; or (iii)
any sale conveyance of or other transfer of all, or substantially all, of the
properties and assets of the Company to any other corporation as a result of
which holders of Common Stock shall be entitled to receive stock, securities or
other property or assets (including Cash) with respect to or in exchange for
such Common Stock, then the Company or the successor or purchasing corporation,
as the case may be, shall execute with the Trustee a supplemental indenture,
providing that each Note shall be convertible into the kind and amount of shares
of stock and other securities or property or assets (including Cash) receivable
upon such reclassification, change, consolidation, merger, combination, sale,
conveyance or transfer by a holder of a number of shares of Common Stock
issuable upon conversion of such Notes immediately prior to such
reclassification, change, consolidation, merger, combination, sale, conveyance
or transfer. Such supplemental indenture shall provide for adjustments which
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Section 3.8(f).

     The Company shall cause notice of the execution of such supplemental
indenture to be provided to Holders of Notes, 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, changes, consolidations, mergers, combinations, sales and
conveyances.

     If this Section 3.8(f) applies to any event or occurrence, Section 3.7
shall not apply.

     (g) Responsibility of Trustee. The Trustee and any other Conversion Agent
         -------------------------
shall not at any time be under any duty or responsibility to any Holder of Notes
to either calculate the Conversion Rate or determine whether any facts exist
which may require any adjustment of the Conversion Rate, or with respect to the
nature or extent or calculation of any such adjustment when made, or with
respect to the method employed, or herein or in any supplemental indenture
provided to be employed, in making the same and shall be protected in relying
upon an Officer's Certificate with respect to the same. The Trustee and any
other

                                       28

<PAGE>

Conversion Agent shall not be accountable with respect to the validity or value
(or the kind or amount) of any shares of Common Stock, or of any securities or
property, which may at any time be issued or delivered upon the conversion of
any Note and the Trustee and any other Conversion Agent make no representations
with respect thereto. Subject to the provisions of Article Five of the Base
Indenture, neither the Trustee nor any Conversion Agent shall be responsible for
any failure of the Company to issue, transfer or deliver any shares of Common
Stock or stock certificates or other securities or property or Cash upon the
surrender of any Note for the purpose of conversion or to comply with any of the
duties, responsibilities or covenants of the Company contained in this Section.
Without limiting the generality of the foregoing, neither the Trustee nor any
Conversion Agent shall be under any responsibility to determine the correctness
of any provisions contained in any supplemental indenture entered into pursuant
to Section 3.8(f) relating either to the kind or amount of shares of stock or
securities or property (including Cash) receivable by Holders upon the
conversion of their Notes after any event referred to in such Section 3.8(f) or
to any adjustment to be made with respect thereto, but, subject to the
provisions of Article Five of the Base Indenture, may accept as conclusive
evidence of the correctness of any such provisions, and shall be protected in
relying upon, the Officer's Certificate (which the Company shall be obligated to
file with the Trustee prior to the execution of any such supplemental indenture)
with respect thereto.

     (h) Simultaneous Adjustments. In the event that Sections 3.6, 3.7 or 3.8
         ------------------------
require adjustments to the Conversion Rate under more than one of Section
3.7(a), (b), (c) or (d), and the Common Stock Record Dates for the distributions
giving rise to such adjustments shall occur on the same date, then such
adjustments shall be made by applying, first, the provisions of Section 3.7(c),
second, the provisions of Section 3.7(d), third, the provisions of Section
3.7(a), and fourth, the provisions of Section 3.7(b).

     (i) Successive Adjustments. After an adjustment to the Conversion Rate
         ----------------------
under Sections 3.6, 3.7 or 3.8, any subsequent event requiring an adjustment
under Sections 3.6, 3.7 or 3.8 shall cause an adjustment to the Conversion Rate
as so adjusted.

     (j) General Considerations. Whenever successive adjustments to the
         ----------------------
Conversion Rate are called for pursuant to Sections 3.6, 3.7 or 3.8, such
adjustments shall be made to the Sale Price or Market Price as may be necessary
or appropriate to effectuate the intent of Sections 3.6, 3.7 or 3.8 and to avoid
unjust or inequitable results as determined in good faith by the Board of
Directors.

     Section 3.9 Optional Conversion to Semi-Annual Cash Pay Notes upon Tax
                 ----------------------------------------------------------
Event. From and after (i) the date (the "Tax Event Date") of the occurrence of a
-----                                    --------------
Tax Event and (ii) the date the Company exercises its option set forth in this
Section 3.9, whichever is later (the "Option Exercise Date"), at the option of
                                      --------------------
the Company, cash interest in lieu of future Accreted Value shall accrue at the
rate of 1.25% per annum on a restated principal amount per $1,000 original
Principal Amount (the "Restated Principal Amount") equal to its Accreted Value
                       -------------------------
on the Option Exercise Date and shall be payable semi-annually on October 10 and
April 10 of each year (each, an "Interest Payment Date") to holders of record at
                                 ---------------------
the close of business on September 25 and March 26 (each, a "Regular Record
                                                             --------------
Date") immediately preceding such Interest Payment Date. Interest will be
----
computed on the basis of a 360-day year comprised of twelve 30-day months and
will accrue from the most recent date on which interest has been paid

                                       29

<PAGE>

or, if no interest has been paid, from the Option Exercise Date. Within 15 days
of the occurrence of a Tax Event, the Company shall deliver a written notice of
such Tax Event by facsimile and first-class mail to the Trustee and within 15
days of their exercise of such option the Company shall deliver a written notice
of the Option Exercise Date by facsimile and first-class mail to the Trustee and
provide notice to the Holders of the Notes. From and after the Option Exercise
Date, (i) the Company shall be obligated to pay at Maturity or upon a Redemption
Date, Purchase Date or Fundamental Change Purchase Date, in lieu of the
Principal Amount or Accreted Value, as applicable, of a Note, the Restated
Principal Amount thereof plus accrued and unpaid interest and (ii) contingent
interest shall cease to accrue on the Notes. Notes authenticated and delivered
after the Option Exercise Date may, and shall if required by the Trustee, bear a
notation in a form approved by the Trustee as to the conversion of the Notes to
Cash Pay Notes.

     Section 3.10 Calculation and Reporting of Original Issue Discount for U.S.
                  -------------------------------------------------------------
Federal Income Tax Purposes. The Company agrees, and each Holder and any
---------------------------
beneficial holder of a Note by its purchase thereof shall be deemed to agree, to
treat (in the absence of an administrative determination or judicial ruling to
the contrary), for United States federal income tax purposes, the Notes as debt
instruments that are subject to Section 1.1275-4(b) of the Treasury Regulations.
For United States federal income tax purposes, the Company shall accrue interest
with respect to outstanding Notes as original issue discount according to the
"noncontingent bond method," set forth in Section 1.1275-4(b) of the Treasury
Regulations, based on a comparable yield of 5.32% compounded semiannually and
the projected payment schedule attached hereto as Exhibit B.

     The Trustee, on its own behalf and on behalf of the Company, will comply
with all applicable certification, information reporting and withholding
(including "backup" withholding) requirements imposed by applicable tax laws,
regulations or administrative practice with respect to (a) any payments or
accruals of interest and original issue discount with respect to the Notes or
(b) the issuance, delivery, holding, transfer, redemption, conversion, or
exercise of rights under the Notes. Such compliance shall include, without
limitation, (i) preparing, timely filing with the applicable taxing authority,
and (to the extent required under applicable tax laws) timely furnishing Holders
with copies of, all tax reports or statements with respect to payments or
accruals of interest and original issue discount on, or redemptions or
conversions of, the Notes which are required to be prepared, filed, and
furnished under applicable tax laws, (ii) withholding and paying over to the
applicable taxing authorities any tax withholdings that are required to be made
with respect to payments or accruals of interest and original issue discount on,
or redemptions or conversions of, the Notes under applicable tax laws, and (iii)
making reasonable efforts to obtain from Holders all IRS Forms (and similar
forms under applicable state, local, and foreign tax law) and other
documentation required under applicable tax laws in order to establish
exemptions from or reductions in withholding taxes. The Trustee shall also
maintain all appropriate records documenting compliance with such requirements
until such time as all applicable periods of limitation for assessing or
collecting any taxes or penalties for failure to fully comply with such
requirements have expired, and shall make such records available, on written
request, to the Company or its authorized representative within a reasonable
period of time after receipt of such request. The Trustee shall comply with any
direction received from the Company with respect to the foregoing or in other
particular circumstances, and may rely on any

                                       30

<PAGE>

such direction or upon an Opinion of Counsel in accordance with the provisions
of Article VII of the Base Indenture.

          The Company acknowledges and agrees, and each Holder and any
beneficial holder of a Note by its purchase thereof shall be deemed to
acknowledge and agree, that (i) the comparable yield means the annual yield the
Company would pay, as of the Issue Date, on a fixed-rate cash pay nonconvertible
debt security with no contingent payments, but with terms and conditions
otherwise comparable to those of the Notes, but the comparable yield may not be
less than the "applicable Federal Rate" within the meaning of United States
Treasury Regulation 1.275-4(b)(4)(i)(A); (ii) the schedule of projected payments
attached hereto as Exhibit B is determined on the basis of the comparable yield
and an assumption of linear growth of the stock price and a constant dividend
yield; (iii) the comparable yield and the schedule of projected payments are not
determined for any purpose other than for the determination of interest accruals
and adjustments thereof in respect of the Notes for United States federal income
tax purposes; and (iv) the comparable yield and the schedule of projected
payments do not constitute a projection or representation regarding the future
stock price or the amounts payable on the Notes.

          Section 3.11  Payment of Interest
                        -------------------

          (a)  Paying Agent to Hold Money in Trust. Prior to 11:00 a.m. (New
               -----------------------------------
York City time) on any applicable payment date, the Company shall deposit with
the Paying Agent (or if the Company or a Subsidiary is acting as Paying Agent,
segregate and hold in trust for the benefit of the Persons entitled thereto) a
sum sufficient to pay semi-annual or contingent interest when due. The Company
shall require each Paying Agent (other than the Trustee) to agree in writing
that the Paying Agent shall hold in trust for the benefit of Holders or the
Trustee all money held by the Paying Agent for the payment of principal or
interest on the Notes and shall notify the Trustee of any default by the Company
in making any such payment. If the Company or a Subsidiary acts as Paying Agent,
it shall segregate the money held by it as Paying Agent and hold it as a
separate trust fund. The Company at any time may require a Paying Agent to pay
all money held by it to the Trustee and to account for any funds disbursed by
the Paying Agent. Upon complying with this Section, the Paying Agent shall have
no further liability for the money delivered to the Trustee.

          (b)  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. If the Trustee is not the Registrar, the Company shall
furnish, or cause the Registrar to furnish, to the Trustee, in writing at least
five business days before 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.

          (c)  Payment of Interest; Interest Rights Preserved. (i) Semi-annual
               ----------------------------------------------
or contingent interest on any Note that is payable, and is punctually paid or
duly provided for, on any applicable payment date shall be paid to the Person in
whose name that Note is registered at the close of business on the Regular
Record Date or accrual date, as the case may be, for such interest at the office
or agency of the Company maintained for such purpose. Each installment of
semi-annual or contingent interest on any Note shall be paid in same-day funds
by transfer to an account maintained by the payee located inside the United
States. In the case of a Global

                                       31

<PAGE>

Security, semi-annual or contingent interest payable on any applicable payment
date will be paid to the Depositary, with respect to that portion of such Global
Security held for its account by Cede & Co. for the purpose of permitting such
party to credit the interest received by it in respect of such Global Security
to the accounts of the beneficial owners thereof.

          (ii)   Except as otherwise specified with respect to the Notes, any
     semi-annual or contingent interest on any Note that is payable, but is not
     punctually paid or duly provided for, within 30 days following any
     applicable payment date (herein called "Defaulted Interest", which term
                                             ------------------
     shall include any accrued and unpaid interest that has accrued on such
     defaulted amount in accordance with paragraph 1 of the Notes), shall
     forthwith cease to be payable to the registered Holder thereof on the
     relevant Regular Record Date or accrual date, as the case may be, by virtue
     of having been such Holder, and such Defaulted Interest may be paid by the
     Company, at its election in each case, as provided in clause (A) or (B)
     below.

                 (A)    The Company may elect to make payment of any Defaulted
          Interest to the Persons in whose names the Notes are registered at the
          close of business on a date for the payment of such Defaulted
          Interest, which shall be fixed in the following manner: The Company
          shall notify the Trustee in writing of the amount of Defaulted
          Interest proposed to be paid on each Note and the date of the proposed
          payment (which shall not be less than 20 days after such notice is
          received by the Trustee), and at the same time the Company shall
          deposit with the Trustee an amount of money equal to the aggregate
          amount proposed to be paid in respect of such Defaulted Interest or
          shall make arrangements satisfactory to the Trustee for such deposit
          on or prior to the date of the proposed payment, such money when
          deposited to be held in trust for the benefit of the Persons entitled
          to such Defaulted Interest as in this clause provided. Thereupon the
          Trustee shall fix a special record date for the payment of such
          Defaulted Interest which shall be not more than 15 days and not less
          than 10 days prior to the date of the proposed payment and not less
          than 10 days after the receipt by the Trustee of the notice of the
          proposed payment (the "Special Record Date"). The Trustee shall
                                 -------------------
          promptly notify the Company of such Special Record Date and, in the
          name and at the expense of the Company, shall cause Notice of the
          proposed payment of such Defaulted Interest and the Special Record
          Date therefor to be mailed, first-class postage prepaid, to each
          Holder of Notes at his address as it appears on the list of Holders
          maintained pursuant to the Indenture not less than 10 days prior to
          such Special Record Date. Notice of the proposed payment of such
          Defaulted Interest and the Special Record Date therefor having been
          mailed as aforesaid, such Defaulted Interest shall be paid to the
          Persons in whose names the Notes are registered at the close of
          business on such Special Record Date and shall no longer be payable
          pursuant to the following clause (B).

                 (B)    Alternatively, the Company may make payment of any
          Defaulted Interest on the Notes in any other lawful manner not
          inconsistent with the requirements of any Notes exchange on which such
          Notes may be listed, and upon such Notice as may be required by such
          exchange, if, after notice given by the

                                       32

<PAGE>
         Company to the Trustee of the proposed payment pursuant to this clause,
         such manner of payment shall be deemed practicable by the Trustee.

         Subject to the foregoing provisions of this Section 3.11, each Note
delivered under this Third Supplemental Indenture upon registration of
transfer of or in exchange for or in lieu of any other Note shall carry the
rights to semi-annual or contingent interest accrued and unpaid to, and to
accrue, which were carried by such other Note.

                                   ARTICLE IV

                                     NOTICE

         Section 4.1 Notice by the Company. The Company shall give prompt
                     ---------------------
written notice to a responsible officer of the Trustee of any fact known to the
Company that would prohibit the making of any payment of monies to or by the
Trustee in respect of the Notes. Notwithstanding any of the provisions of the
Base Indenture and this Third Supplemental Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts that would prohibit the
making of any payment of monies to or by the Trustee in respect of the Notes;
provided, however, that if the Trustee shall not have received the notice
provided for in this Section 4.1 at least two business days prior to the date
upon which by the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of (or premium, if
any) or interest on any Note), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive such
money and to apply the same to the purposes for which they were received, and
shall not be affected by any notice to the contrary that may be received by it
within two business days prior to such date.

                                   ARTICLE V

                                EVENTS OF DEFAULT

         Section 5.1 Events of Default. For the sole benefit of the holders of
the Notes, Section 6.01 of the Base Indenture is hereby deleted in its entirety
and replaced by the following Section 6.01:

         "SECTION 6.01. If any one or more of the following shall have
occurred and be continuing (each of the following, an "Event of Default"):
                                                       ----------------

         (a)      default in the payment of the Principal Amount (or if the
     Notes have been converted to Cash Pay Notes following a Tax Event pursuant
     to Section 3.9, the Restated Principal Amount), Issue Price plus accrued
     Original Issue Discount, Redemption Price, Purchase Price or Fundamental
     Change Purchase Price with respect to any Notes, when such amount becomes
     due and payable at Maturity, upon redemption, upon declaration, when due
     for purchase by the Company or otherwise; or

         (b)      if contingent interest is payable or the Notes have been
     converted to Cash Pay Notes following a Tax Event pursuant to Section 3.9,
     the failure to pay such interest due within 30 days of the due date; or

                                       33

<PAGE>
     (c)   default in the performance, or breach, of any covenant of the Company
in this Indenture, including failure on the part of the Company to comply with
Article Ten (other than a covenant or a default in whose performance or whose
breach is elsewhere in this Section specifically dealt with or which has
expressly been included in this Indenture solely for the benefit of a series of
Debt Securities other than the Notes), and continuance of such default or breach
for a period of 90 days after the date on which written notice specifying such
failure, stating that such notice is a "notice of default" hereunder, and
requiring the Company to remedy the same shall have been given, by registered or
certified mail, 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 Notes at the
time Outstanding; or

     (d)   if an event of default as defined in any mortgage, indenture, bonds,
debentures, notes or instrument under which there may be issued, or by which
there may be secured or evidenced, any indebtedness of the Company for money
borrowed, whether such indebtedness now exists or shall hereafter be created,
shall happen and shall result in more than $50,000,000 (or its equivalent in any
other currency) in principal amount of such indebtedness becoming or being
declared due and payable before the date on which it would otherwise become due
and payable, and that acceleration shall not be rescinded or annulled, or that
indebtedness shall not have been discharged, within a period of 10 days after
there has been given, by registered or certified mail, 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 Notes at the time Outstanding a written notice
specifying the event of default and requiring the Company to cause the
acceleration to be rescinded or annulled or to cause that indebtedness to be
discharged and stating that such notice is a "notice of default" hereunder; or

     (e)   the Company shall (i) voluntarily commence any proceeding or file any
petition seeking relief under Title 11 of the United States Code or any other
Federal or State bankruptcy, insolvency or similar law, (ii) consent to the
institution of, or fail to controvert within the time and in the manner
prescribed by law, any such proceeding or the filing of any such petition, (iii)
apply for or consent to the appointment of a receiver, trustee, custodian,
sequestrator or similar official for the Company or for a substantial part of
its property, (iv) file an answer admitting the material allegations of a
petition filed against it in any such proceeding, (v) make a general assignment
for the benefit of creditors, (vi) admit in writing its inability or fail
generally to pay its debts as they become due, (vii) take corporate action for
the purpose of effecting any of the foregoing, or (viii) take any comparable
action under any foreign laws relating to insolvency; or

     (f)   the entry of an order or decree by a court having competent
jurisdiction in the premises for (i) relief in respect of the Company or a
substantial part of any of its property under Title 11 of the United States Code
or any other Federal or State bankruptcy, insolvency or similar law, (ii) the
appointment of a receiver, trustee, custodian, sequestrator or similar official
for the Company or for a substantial part of any of its property or (iii) the
winding-up or liquidation of the Company, and such order or decree shall
continue unstayed and in effect for 60 consecutive days; or any similar relief

                                       34

<PAGE>

     is granted under any foreign laws and the order or decree stays in effect
     for 60 consecutive days;

then and in each and every case that an Event of Default described in clause
(a), (b), (c) or (d) occurs and is continuing, either the Trustee or the Holders
of not less than 25% in aggregate Principal Amount of the Notes then Outstanding
hereunder, by notice in writing to the Company (and to the Trustee if given by
Holders), may declare the Issue Price plus the Original Issue Discount accrued
through the date of such declaration, and any accrued and unpaid contingent
interest through the date of such declaration, on all the Notes to be due and
payable immediately, and upon any such declaration the same shall become and
shall be immediately due and payable, anything in this Indenture or in the Notes
appertaining thereto contained to the contrary notwithstanding. If an Event of
Default described in clause (e) or (f) occurs, then and in each and every such
case, the Issue Price plus the Original Issue Discount accrued through the
occurrence of the event described in clause (e) or (f) and any accrued and
unpaid contingent interest through the date of such event on all the Notes then
Outstanding hereunder shall ipso facto become and be immediately due and payable
without any declaration or other act on the part of the Trustee or any Holders,
anything in this Indenture or in the Notes contained to the contrary
notwithstanding.

          If the Notes have been converted to Cash Pay Notes following the
occurrence of a Tax Event, the amount due on an acceleration will be the
Restated Principal Amount plus accrued and unpaid interest.

          In case the Trustee or any Holder shall have proceeded to enforce any
right under this Indenture and such proceedings shall have been discontinued or
abandoned because of such rescission or annulment or for any other reason or
shall have been determined adversely to the Trustee or such Holder, then and in
every such case the parties hereto shall be restored respectively to their
several positions and rights hereunder, and all rights, remedies and powers of
the parties hereto shall continue as though no such proceeding had been taken.

          The Holders of a majority in aggregate Principal Amount of the Notes
at the time Outstanding by notice to the Trustee and without notice to any other
Holder may rescind an acceleration and its consequences if the rescission would
not conflict with any judgment or decree already rendered and if all existing
Events of Default have been cured or waived except nonpayment of the Issue Price
plus accrued Original Issue Discount and accrued and unpaid contingent interest,
if any, that has become due solely because of acceleration. Upon any such
rescission, the parties hereto shall be restored respectively to their several
positions and rights hereunder, and all rights, remedies and powers of the
parties hereto shall continue as though no such proceeding had been taken. The
foregoing Events of Default shall constitute Events of Default whatever the
reason for any such Event of Default and whether it is voluntary or involuntary
or is 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.

          The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any event which with the giving of notice and the lapse of time would become an
Event of Default under clause (d), (e) or (f) indicating its status and what
action the Company is taking or proposes to take with respect thereto."

                                       35

<PAGE>

                                   ARTICLE VI

                                  MODIFICATION

          Section 6.1 Purposes for Which Supplemental Indenture May Be Entered
                      --------------------------------------------------------
Into Without Consent of Holders. For the sole benefit of the Holders of the
-------------------------------
Notes, Section 9.01 of the Base Indenture is modified by deleting paragraph (e)
in its entirety.

          Section 6.2 Modification of Indenture with Consent of Holders of
                      ----------------------------------------------------
Notes. For the sole benefit of the Holders of the Notes, Section 9.02 of the
-----
Base Indenture is hereby deleted in its entirety and replaced by the following
Section 9.02:

          "SECTION 9.02. Modification of Indenture with Consent of Holders of
                         ----------------------------------------------------
Notes. Without notice to any Holder but with the consent (evidenced as provided
-----
in Section 8.01 of the Base Indenture) of the Holders of not less than a
majority in aggregate Principal Amount of the Outstanding Notes, the Company,
when authorized by a resolution of the Board of Directors, and the Trustee may
from time to time and at any time enter into an Indenture or Indentures
supplemental hereto (which shall conform to the provisions of the Trust
Indenture Act as in force at the date of execution thereof) for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of any supplemental indenture or of modifying in
any manner the rights of the Holders of the Notes; provided that no such
supplemental indenture, without the consent of the Holders of each Note so
affected, shall:

          (i)    reduce the percentage in Principal Amount of Notes whose
Holders must consent to an amendment;

          (ii)   reduce the Principal Amount, Restated Principal Amount or Issue
Price or extend the Maturity of any Note;

          (iii)  reduce the Redemption Price, Purchase Price or Fundamental
Change Purchase Price of any Note;

          (iv)   make any change that adversely affects the rights of Holders to
convert their Notes;

          (v)    make any change in the manner of calculation or rate of accrual
of, or that adversely affects the right to receive, Original Issue Discount or
interest, in respect of any Note; reduce the rate of interest referred to in
paragraph 1 of the Notes; reduce the rate of interest referred to in Section 3.9
upon the occurrence of a Tax Event, or extend the time for payment of Original
Issue Discount, contingent interest or interest, if any, on any Notes.

          (vi)   make any change that adversely affects the right to require the
Company to purchase the Notes.

          (vii)  make any Note payable in Currency other than that stated in the
Note;

          (viii) release any security that may have been granted in respect of
the Notes;

                                       36

<PAGE>

          (ix)    make any change in Section 6.06 of the Base Indenture or the
     second sentence of this Section 9.02;

          (x)     impair the right to institute suit for the enforcement of
     any payment with respect to, or a conversion of, the Notes; or

          (xi)    modify any of the provisions of this Section 9.02, Section
     4.09 of the Base Indenture or Section 6.06 of the Base Indenture, except to
     increase any such percentage or to provide that certain other provisions of
     this Indenture cannot be modified or waived without the consent of the
     Holder of each Outstanding Note affected thereby, provided, however, that
     this Section 9.02 shall not be deemed to require the consent of any Holder
     with respect to changes in the references to "the Trustee" and concomitant
     changes in this Section 9.02, Section 4.09 or the deletion of this proviso,
     in accordance with the requirements of Section 7.08 of the Base Indenture
     and Section 9.01(j) of the Base Indenture.

          A supplemental indenture which changes or eliminates any covenant or
other provision of this Indenture which has been expressly included solely for
the benefit of one or more particular series of debt securities and coupons, if
any, or which modifies the rights of the Holders of debt securities and coupons
of such series with respect to such covenant or other provision, shall be deemed
not to affect the rights under this Indenture of the Holders of the Notes of any
other series.

          Upon the request of the Company, accompanied by a copy of a resolution
of the Board of Directors authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence of the consent of
Holders as aforesaid, the Trustee shall join with the Company in the execution
of such supplemental indenture unless such supplemental indenture affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise, in
which case the Trustee may in its discretion but shall not be obligated to enter
into such supplemental indenture. The Trustee shall be entitled to receive, and
shall be fully protected in relying upon (subject to Section 7.01 of the Base
Indenture), an Officers' Certificate and an Opinion of Counsel stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture.

          It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.

          After an amendment under this Section 9.02 becomes effective, the
Company shall mail to Holders of the Notes affected thereby a notice briefly
describing such amendment. The failure to give such notice to all such Holders,
or any defect therein, shall not impair or affect the validity of an amendment
under this Section 9.02."

                                       37

<PAGE>

                                  ARTICLE VII

                           AMENDMENT OF CERTAIN OTHER

                        PROVISIONS OF THE BASE INDENTURE

          Section 7.1 Amendments Relating to the Notes. The Base Indenture is
                      --------------------------------
hereby further amended, solely with respect to the Notes, as follows:

          (a) Section 2.08 of the Base Indenture is hereby amended by replacing
the words therein "principal amount" with "Principal Amount."

          (b) Section 2.09 of the Base Indenture is hereby amended by replacing
the words therein "principal amount" with "Principal Amount" and "bona fide
purchaser" with "protected purchaser."

          (c) Section 4.01 of the Base Indenture is hereby amended by replacing
it in its entirety with the following:

          "Section 4.01. Payment of Notes. The Company shall promptly make all
                         ----------------
payments in respect of the Notes on the dates and in the manner provided in the
Notes or pursuant to this Indenture or the Third Supplemental Indenture. Any
amounts to be given to the Trustee or Paying Agent, shall be deposited with the
Trustee or Paying Agent by 10:00 a.m., New York City time, by the Company.
Principal Amount, Restated Principal Amount, Issue Price plus accrued Original
Issue Discount, Redemption Price, Purchase Price, Fundamental Change Purchase
Price and cash interest shall be considered paid on the applicable date due if
on such date (or, in the case of a Purchase Price or Fundamental Change Purchase
Price, on the business day following the applicable Purchase Date or Fundamental
Change Purchase Date, as the case may be) the Trustee or the Paying Agent holds,
in accordance with this Indenture or the Third Supplemental Indenture, money or
securities, if permitted hereunder, sufficient to pay all such amounts then due.

          The Company shall, to the extent permitted by law, pay cash interest
on overdue amounts at the rate per annum set forth in paragraph 1 of the Notes,
compounded semiannually, which interest shall accrue from the date such overdue
amount was originally due to the date payment of such amount, including interest
thereon, has been made or duly provided for. All such interest shall be payable
on demand. The accrual of such interest on overdue amounts shall be in lieu of,
and not in addition to, the continued accrual of Original Issue Discount."

          (d) Section 4.04 of the Base Indenture is hereby amended as follows:

          i. Section 4.04(a)(i) of the Base Indenture is hereby amended by
     replacing the phrase therein "payment of the principal of, and premium, if
     any, or interest on," with "payment in respect of."

          ii. Section 4.04(a)(ii) of the Base Indenture is hereby amended by
     replacing the phrase therein "payment of the principal of, and premium, if
     any, or interest on," with "payment in respect of."

                                       38

<PAGE>

          iii. Section 4.04(b) of the Base Indenture is hereby amended by (i)
     replacing the phrase on the second line therein "the principal of, and
     premium, if any, or interest on," with "payments in respect of", (ii)
     replacing the phrase on the fifth line therein "pay such principal,
     premium, if any, or interest" with "make such payments" and (iii) replacing
     the phrase on the seventh line therein "any payment of the principal of,
     and premium, if any, or interest on," with "any payment in respect of."

          iv.  Section 4.04(d) of the Base Indenture is hereby amended by (i)
     replacing the phrase on the third line therein "the principal of, and
     premium, if any, or interest on," with "payments in respect of" and (ii)
     replacing the phrase on the fourth line therein "pay the principal, premium
     or interest" with "make such payments."

          (e)  Section 4.09 of the Base Indenture is hereby amended by replacing
the words therein "principal amount" with "Principal Amount."

          (f)  Section 6.04 of the Base Indenture is hereby amended by replacing
the words therein "principal amount" with "Principal Amount" and "payment of the
principal of, and premium, if any, or interest on," with "payment in respect
of."

          (g)  Section 6.06 of the Base Indenture is hereby amended by replacing
the words "principal amount" with "Principal Amount."

          (h)  Section 6.07 of the Base Indenture is hereby amended by replacing
the phrase therein "payment of the principal of, and premium, if any, or
interest on," with "payment in respect of."

          (i)  Section 6.08 of the Base Indenture is hereby amended by replacing
the phrase therein "payment of the principal of, and premium, if any, or
interest on," with "payment in respect of."

          (j)  Section 7.01(d) of the Base Indenture is hereby amended by
replacing the words therein "principal amount" with "Principal Amount."

          (k)  Section 7.02(g) of the Base Indenture is hereby amended by
replacing the words therein "principal amount" with "Principal Amount."

          (l)  Section 7.08 of the Base Indenture is hereby amended by replacing
the words in the first and second paragraphs therein "principal amount" with
"Principal Amount."

          (m)  Section 8.01 of the Base Indenture is hereby amended by replacing
the words therein "principal amount" with "Principal Amount."

          (n)  Section 8.03 of the Base Indenture is hereby amended by replacing
the phrase therein "payment of or on account of the principal of and premium, if
any, and (subject to Section 2.03) interest on" with "payments in respect of."

          (o)  Section 8.04 of the Base Indenture is hereby amended by replacing
the words therein "principal amount" with "Principal Amount."

                                       39

<PAGE>

          (p) Section 9.01(b) of the Base Indenture is hereby amended by
replacing the words therein "principal amount" with "Principal Amount."

          (q) Article XI of the Base Indenture is hereby amended by replacing it
in its entirety with the following:

                                   "ARTICLE XI

                             DISCHARGE OF INDENTURE

          SECTION 11.01. Discharge of Liability on Notes. When (i) the Company
                         -------------------------------
delivers to the Trustee all Outstanding Notes (other than Notes replaced
pursuant to Section 2.09) for cancellation or (ii) all Outstanding Notes have
become due and payable and the Company deposits with the Trustee cash or, if
expressly permitted by the terms of the Notes, Common Stock sufficient to pay
all amounts due and owing on all outstanding Notes (other than Notes replaced
pursuant to Section 2.09 of this Indenture), and if in either case the Company
pays all other sums payable hereunder by the Company, then this Indenture and
the Third Supplemental Indenture shall, subject to Section 7.06 of this
Indenture, cease to be of further effect with respect to the Notes. The Trustee
shall join in the execution of a document prepared by the Company acknowledging
satisfaction and discharge of this Indenture and the Third Supplemental
Indenture on demand of the Company accompanied by an Officers' Certificate and
Opinion of Counsel and at the cost and expense of the Company.

          SECTION 11.02. Repayment to the Company. The Trustee and the Paying
                         ------------------------
Agent shall return to the Company upon written request any money or securities
held by them for the payment of any amount with respect to the Notes that
remains unclaimed for two years, subject to applicable unclaimed property law.
After return to the Company, Holders entitled to the money or securities must
look to the Company for payment as general creditors unless an applicable
abandoned property law designates another person and the Trustee and the Paying
Agent shall have no further liability to the Holders with respect to such money
or securities for that period commencing after the return thereof."

          Section 7.2 Interpretation of Base Indenture. Except as otherwise
                      --------------------------------
specifically provided in this Third Supplemental Indenture, whenever in the Base
Indenture there is mentioned, in any context, the principal of or principal
amount of any Debt Security of any series or a percentage in principal amount of
the Outstanding Debt Securities of any series, such mention shall be deemed to
be, solely with respect to the Notes, the Principal Amount of the Notes or such
percentage of the aggregate Principal Amount of the Notes at the time
Outstanding.

                                  ARTICLE VIII

                                  MISCELLANEOUS

          Section 8.1 Ratification of Indenture. The Indenture as supplemented
                      -------------------------
by this Third Supplemental Indenture, is in all respects ratified and confirmed,
and this Third

                                       40

<PAGE>

          Supplemental Indenture shall be deemed part of the Indenture in the
manner and to the extent herein and therein provided.

          Section 8.2 Trustee Not Responsible for Recitals. The recitals herein
                      ------------------------------------
contained are made by the Company and not by the Trustee, and the Trustee
assumes no responsibility for the correctness thereof. The Trustee makes no
representation as to the validity or sufficiency of this Third Supplemental
Indenture.

          Section 8.3 New York Law to Govern. THIS THIRD SUPPLEMENTAL INDENTURE,
                      ----------------------
EACH NOTE AND EACH COUPON SHALL BE DEEMED TO BE NEW YORK CONTRACTS, AND FOR ALL
PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID STATE (WITHOUT
REFERENCE TO PRINCIPLES OF CONFLICTS OF LAW).

          Section 8.4 Separability. In case any one or more of the provisions
                      ------------
contained in this Third Supplemental Indenture or in the Notes shall for any
reason be held to be invalid, illegal or unenforceable in any respect, then, to
the extent permitted by law, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Third Supplemental Indenture or of
the Notes, but this Third Supplemental Indenture and the Notes shall be
construed as if such invalid or illegal or unenforceable provision had never
been contained herein or therein.

          Section 8.5 Counterparts. This Third Supplemental Indenture may be
                      ------------
executed in any number of counterparts each of which shall be an original, but
such counterparts shall together constitute but one and the same instrument.

                                       41

<PAGE>

          IN WITNESS WHEREOF, the parties hereto have caused this Third
Supplemental Indenture to be duly executed by their respective officers
thereunto duly authorized, on the date or dates indicated in the acknowledgments
and as of the day and year first above written.

                                        ELECTRONIC DATA SYSTEMS CORPORATION,
                                        as Issuer

                                        By: /s/ D. Gilbert Friedlander
                                           _____________________________________
                                           Name: D. Gilbert Friedlander
                                           Title: Senior Vice President

Attest:

By: /s/ David B. Hollander
   ______________________________________
   Name: David B. Hollander
   Title: Assistant Secretary

                                        THE CHASE MANHATTAN BANK,
                                        as Trustee

                                        By: /s/ Kalvin R. Dickson
                                           _____________________________________
                                           Name: Kalvin R. Dickson
                                           Title: Vice President

<PAGE>

                                                                      EXHIBIT A

                        [FORM OF FACE OF GLOBAL SECURITY]

          THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY. THIS SECURITY IS NOT
EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF THIS
SECURITY AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A
NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE
DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE INDENTURE.

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

                                       A-1

<PAGE>
                       ELECTRONIC DATA SYSTEMS CORPORATION

            ZERO-COUPON CONVERTIBLE SENIOR NOTE DUE OCTOBER 10, 2021

No. __________                              CUSIP:
                                            ISIN:

Issue Date:  October 10, 2001                  Original Issue Discount: $220.59
Issue Price: $779.41                           (for each $1,000 Principal Amount
(for each $1,000 Principal                     at Final Maturity)
Amount at Maturity)

          Electronic Data Systems Corporation, a Delaware corporation, promises
to pay to __________ or registered assigns, on October 10, 2021 the Principal
Amount of __________ Dollars ($__________).

          This Note shall not bear periodic interest except as specified on the
other side of this instrument. This Note shall accrete as specified on the other
side of this Note. This Note is convertible as specified on the other side of
this Note.

          Additional provisions of this Note are set forth on the other side of
this Note.

                                       A-2

<PAGE>

          IN WITNESS WHEREOF, Electronic Data Systems Corporation has caused
this instrument to be duly executed.

Dated:  October 10, 2001                     ELECTRONIC DATA SYSTEMS CORPORATION

                                             By:________________________________
                                                Name:
                                                Title:

Attest:

By:________________________________________
   Name:
   Title:

The Chase Manhattan Bank, as Trustee, certifies that this is
one of the Securities referred to in the within
mentioned Indenture.

By:________________________________________
   Name:
   Title: Authorized Signatory

Dated:  October 10, 2001

                                       A-3

<PAGE>

                    [FORM OF REVERSE SIDE OF GLOBAL SECURITY]

                       ELECTRONIC DATA SYSTEMS CORPORATION

            ZERO-COUPON CONVERTIBLE SENIOR NOTE DUE OCTOBER 10, 2021

          1.       INTEREST

          This Note shall not bear periodic interest, except as specified in
this paragraph and in paragraphs 5 and 10 hereof. If the Principal Amount hereof
or any portion of such Principal Amount is not paid when due (whether upon
acceleration pursuant to the Indenture, upon the date set for payment of the
Redemption Price pursuant to paragraph 6 hereof, upon the date set for payment
of a Purchase Price or Fundamental Change Purchase Price pursuant to paragraph 7
hereof or upon the Maturity Date of this Note) or if interest (including
semi-annual contingent interest, if any) due hereon or any portion of such
interest is not paid when due in accordance with paragraph 5 or 10 hereof, then
in each such case the overdue amount shall bear interest at the rate of 1.25%
per annum, compounded semiannually (to the extent that the payment of such
interest shall be legally enforceable), which interest shall accrue from the
date such overdue amount was due to the date payment of such amount, including
interest thereon, has been made or duly provided for. All such interest shall be
payable on demand. The accrual of such interest on overdue amounts shall be in
lieu of, and not in addition to, the continued accretion.

          The Notes shall increase in Accreted Value commencing on the Issue
Date.

          "Accreted Value" means, at any date of determination, (1) prior to
           --------------
such time as this Note is converted to a Cash Pay Note, the sum of (x) the Issue
Price of this Note and (y) the portion of the excess of the Principal Amount of
this Note over the Issue Price ("Original Issue Discount") which shall have been
amortized by the Company in accordance with GAAP through such date, such amount
to be so amortized on a daily basis and compounded semiannually on each April 10
and October 10 at the rate of 1.25% per annum from the Issue Date through the
date of determination compounded on the basis of a 360-day year and twelve
30-day months and (2) at or after such time as this Note is converted to a Cash
Pay Note, its Restated Principal Amount.

          2.       METHOD OF PAYMENT

          Subject to the terms and conditions of the Indenture, the Company
shall make payments in respect of the Notes to the Persons who are registered
Holders of Notes at the close of business on the business day preceding the
Redemption Date or Maturity Date, as the case may be, or at the close of
business on a Purchase Date or Fundamental Change Purchase Date, as the case may
be. Holders must surrender Notes to a Paying Agent to collect such payments in
respect of the Notes. The Company shall pay cash amounts in money of the United
States that at the time of payment is legal tender for payment of public and
private debts. However, the Company may make such cash payments by check payable
in such money.

                                       A-4

<PAGE>
          3. PAYING AGENT, CONVERSION AGENT, BID AGENT AND REGISTRAR

          Initially, The Chase Manhattan Bank (the "Trustee"), shall act as
                                                    -------
Paying Agent, Conversion Agent, Bid Agent and Registrar. The Company may appoint
and change any Paying Agent, Conversion Agent, Bid Agent, Registrar or
co-registrar without notice, other than notice to the Trustee except that the
Company will maintain at least one Paying Agent in the State of New York, The
City of New York, Borough of Manhattan, which shall initially be an office or
agency of the Trustee. The Company or any of its Subsidiaries or any of their
Affiliates may act as Paying Agent, Conversion Agent, Registrar or co-registrar.
None of the Company or any of its Subsidiaries or any of these Affiliates shall
act as Bid Agent.

          4. INDENTURE

          The Company issued the Notes under an Indenture dated as of August 12,
1996 between the Company and Trustee, as supplemented by a Third Supplemental
Indenture relating to the Notes between the Company and Trustee dated October
10, 2001 (together, the "Indenture"). The terms of the Notes include those
                         ---------
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 ("TIA") as in effect on the date of the Indenture.
                              ---
The Notes are subject to all such terms, and Holders are referred to the
Indenture and the Act for a statement of them. Capitalized terms not defined
herein have the meanings given to those terms in the Indenture.

          The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to: Electronic Data
Systems Corporation, 5400 Legacy Drive, Plano, TX 75204, Attention: Investor
Relations.

          5. CONTINGENT INTEREST

          Subject to the accrual and Common Stock Record Date provisions
specified in this paragraph 5, the Company shall pay contingent interest to the
Holders during any six-month period (a "Contingent Interest Period") from
                                        --------------------------
October 10 to April 9 and from April 10 to October 9, commencing October 10,
2004, if the average Note Price for the Five-Day Period with respect to such
Contingent Interest Period equals 120% or more of the Accreted Value of such
Note to the day immediately preceding the first day of the relevant Contingent
Interest Period.

          The amount of contingent interest payable per $1,000 Principal Amount
hereof in respect of any Contingent Interest Period shall equal the greater of
(x) Cash Dividends paid by the Company per share of Common Stock during that
Contingent Interest Period multiplied by the number of shares of Common Stock
into which $1,000 Principal Amount hereof is convertible pursuant to paragraph 9
hereof as of the accrual date for such contingent interest and (y) 0.125% of the
average Note Price for the Five-Day Period with respect to such Contingent
Interest Period.

          Contingent interest, if any, will accrue and be payable to Holders as
of the Common Stock Record Date for the related Cash Dividend or, if no Cash
Dividend is paid by the Company during a quarter within the relevant Contingent
Interest Period, to Holders as of the

                                       A-5

<PAGE>

15th day preceding the last day of the relevant Contingent Interest Period. Such
payments shall be paid on the payment date of the related Cash Dividend or, if
no Cash Dividend is paid by the Company during a quarter within the relevant
Contingent Interest Period, on the last day of the relevant Contingent Interest
Period. In addition, on any Purchase Date, Fundamental Change Purchase Date or
Redemption Date that occurs during a Contingent Interest Period for which a
Holder is entitled to contingent interest pursuant to clause (y) of the
preceding paragraph, contingent interest will be payable to such Holder in an
amount equal to the amount that would have been otherwise payable to such Holder
on the last day of such Contingent Interest Period divided by the actual number
of days from the first day of such Contingent Interest Date to the Purchase
Date, Fundamental Change Purchase Date or Redemption Date, as the case may be,
using a 360-day year composed of twelve 30-day months.

        "Five-Day Period" means, with respect to any Contingent Interest Period,
         ---------------
the five Trading Days ending on the second Trading Day immediately preceding the
first day of such Contingent Interest Period; provided, however, if the Company
shall have declared a Cash Dividend on its Common Stock that is payable during
such Contingent Interest Period but for which the Common Stock Record Date for
determining stockholders entitled thereto precedes the first day of such
Contingent Interest Period, then "Five-Day Period" means, with respect to such
Contingent Interest Period, the five Trading Days ending on the second Trading
Day immediately preceding such Common Stock Record Date.

        "Cash Dividends" means all cash dividends on the Common Stock (whether
         --------------
regular, periodic, extraordinary, special, nonrecurring or otherwise) as
declared by the Company's Board of Directors as part of its cash dividend
payment practices.

        "Note Price" means, as of any date of determination, the average of the
         ----------
secondary market bid quotations per $1,000 Principal Amount obtained by the Bid
Agent for $10 million Principal Amount of Notes at approximately 4:00 p.m. (New
York City time) on such determination date from three recognized securities
dealers in The City of New York (none of which shall be an Affiliate of the
Company) selected by the Company; provided, however, if (a) at least three such
bids are not obtained by the Bid Agent or (b) in the Company's reasonable
judgment, the bid quotations are not indicative of the secondary market value of
the Notes as of such determination date, then the Note Price for such
determination date shall equal (i) the Conversion Rate in effect as of such
determination date multiplied by (ii) the average Sale Price of Common Stock for
the five Trading Days ending on such determination date, appropriately adjusted
to take into account the occurrence, during the period commencing on the first
of such Trading Days during such five Trading Day period and ending on such
determination date, of any event described in Section 3.7(a), 3.7(b), 3.7(c) or
3.7(d) (subject to the conditions set forth in Sections 3.8(a) and 3.8(b)) of
the Indenture.

        Upon determination that Holders will be entitled to receive contingent
interest which may become payable during a Contingent Interest Period, on or
prior to the first day of such Contingent Interest Period, the Company shall
issue a press release and publish such information on its web site on the World
Wide Web or through such other similar public medium, if any, as the Company may
use at that time.

                                       A-6

<PAGE>

        6.   REDEMPTION AT THE OPTION OF THE COMPANY

        No sinking fund is provided for the Notes. Beginning on October 10,
2004, the Company may redeem the Notes for cash, in whole, or from time to time
in part, at a redemption price equal to the Accreted Value. The Company will
give holders not less than 30-days' nor more than 60-days' notice of redemption.

        The table below shows what the Accreted Value of a Note per $1,000
Principal Amount would be on October 10, 2004, and at specified dates thereafter
prior to maturity and at Maturity Date. The Accreted Value, in dollars, of a
Note per $1,000 Principal Amount redeemed between such dates shall include an
additional amount reflecting the increase in Accreted Value since the next
preceding date in the table to but excluding the actual Redemption Date.

                                                     Increase
                                                        in
                                                     Accreted
                                        Issue        Value at     Redemption
Redemption Date                        Price(1)      1.25%(2)     Price (1/2)
---------------                        --------      ---------    -----------
October 10, 2004.....................  $779.41       $   29.69    $    809.10
October 10, 2005.....................  $779.41       $   39.83    $    819.24
October 10, 2006.....................  $779.41       $   50.11    $    829.52
October 10, 2007.....................  $779.41       $   60.51    $    839.92
October 10, 2008.....................  $779.41       $   71.04    $    850.45
October 10, 2009.....................  $779.41       $   81.70    $    861.11
October 10, 2010.....................  $779.41       $   92.50    $    871.91
October 10, 2011.....................  $779.41       $  103.43    $    882.84
October 10, 2012.....................  $779.41       $  114.50    $    893.91
October 10, 2013.....................  $779.41       $  125.71    $    905.12
October 10, 2014.....................  $779.41       $  137.06    $    916.47
October 10, 2015.....................  $779.41       $  148.55    $    927.96
October 10, 2016.....................  $779.41       $  160.19    $    939.60
October 10, 2017.....................  $779.41       $  171.97    $    951.38
October 10, 2018.....................  $779.41       $  183.90    $    963.31
October 10, 2019.....................  $779.41       $  195.98    $    975.39
October 10, 2020.....................  $779.41       $  208.21    $    987.62
October 10, 2021.....................  $779.41       $  220.59    $  1,000.00

             If this Note has been converted to a Cash Pay Note, the
Redemption Price will be equal to the Restated Principal Amount plus accrued and
unpaid interest from the date of such conversion to the Redemption Date; but in
no event will this Note be redeemable before October 10, 2004.

             In addition to the Redemption Price payable with respect to all
Notes or portions thereof to be redeemed as of a Redemption Date, the Holders of
such Notes (or portions thereof) shall be entitled to receive accrued and unpaid
contingent interest, if any, with respect thereto, which contingent interest
shall be paid in cash on the Redemption Date.

                                       A-7

<PAGE>

        7.   PURCHASE BY THE COMPANY AT THE OPTION OF THE HOLDER; PURCHASE AT
             THE OPTION OF THE HOLDER UPON A FUNDAMENTAL CHANGE

        Subject to the terms and conditions of the Indenture, a Holder of Notes
shall have the option to require the Company to purchase the Notes held by such
Holder on the following Purchase Dates and at the following Purchase Prices per
$1,000 Principal Amount, upon delivery of a Purchase Notice containing the
information set forth in the Indenture, from the opening of business on the date
that is 30 business days prior to such Purchase Date until the close of business
on such Purchase Date and upon delivery of the Notes to the Paying Agent by the
Holder as set forth in the Indenture. For any Purchase Date after October 10,
2003, such Purchase Prices may be paid, at the option of the Company, in cash or
by the issuance and delivery of shares of Common Stock, or in any combination
thereof. The Company will pay the Purchase Price for any purchase on October 10,
2003 only in cash.

        The purchase price of a Note will be:

        .    $799.08 per Note on October 10, 2003;

        .    $809.10 per Note on October 10, 2004;

        .    $829.52 per Note on October 10, 2006;

        .    $882.84 per Note on October 10, 2011; and

        .    $939.60 per Note on October 10, 2016.

        Notes in denominations larger than $1,000 of Principal Amount may be
purchased in part, but only in multiples of $1,000 of Principal Amount.

        If prior to a Purchase Date this Note has been converted to a Cash Pay
Note, the Purchase Price will be equal to the Restated Principal Amount plus
accrued and unpaid interest from the date of conversion to the Purchase Date.

        In addition to the Purchase Price payable with respect to all Notes or
portions thereof to be purchased as of the Purchase Date, the Holders of such
Notes (or portions thereof) shall be entitled to receive accrued and unpaid
contingent interest, if any, with respect thereto, which contingent interest
shall be paid in cash promptly following the later of the Purchase Date and the
time of delivery of such Notes to the Paying Agent pursuant to the Indenture.

        If a Fundamental Change shall occur at any time prior to October 10,
2003, each Holder shall have the right, at such Holder's option and subject to
the terms and conditions of the Indenture, to require the Company to purchase
such Holder's Notes on a date no later than 35 business days after the date of
the Fundamental Change, for a Fundamental Change Purchase Price equal to the
Accreted Value on the Fundamental Change Purchase Date. The Fundamental Change
Purchase Price shall be paid in cash. If, prior to the Fundamental Change
Purchase Date, this Note was converted to a Cash Pay Note the Fundamental Change
Purchase Price will be equal to the Restated Principal Amount plus accrued and
unpaid interest from the date of

                                       A-8

<PAGE>

conversion to the Fundamental Change Purchase Date. Notes in denominations
larger than $1,000 of Principal Amount may be surrendered for purchase in part
in connection with a Fundamental Change, but only in multiples of $1,000 of
Principal Amount.

          Holders have the right to withdraw any Purchase Notice or
Fundamental Change Purchase Notice, as the case may be, by delivery to the
Paying Agent of a written notice of withdrawal in accordance with the provisions
of the Indenture.

          8.   NOTICE OF REDEMPTION AT THE OPTION OF THE COMPANY

          Notice of redemption at the option of the Company shall be mailed at
least 30 days but not more than 60 days before the Redemption Date to each
Holder of Notes to be redeemed at the Holder's registered address. If money
sufficient to pay the Redemption Price of, together with any accrued and unpaid
contingent interest with respect to, all Notes (or portions thereof) to be
redeemed on the Redemption Date is deposited with the Paying Agent prior to or
on the Redemption Date, on and after such date Original Issue Discount and
interest (including contingent interest), if any, on the Notes (or portions
thereof) called for redemption will cease to accrue (or portions thereof). Notes
in denominations larger than $1,000 Principal Amount may be redeemed in part but
only in multiples of $1,000 or Principal Amount.

          9.   CONVERSION

          A Holder of a Note may convert this Note into Common Stock at any time
on or before the close of business on October 10, 2021 if at least one of the
following conditions is satisfied:

               (a)  the Twenty-Day Average Price on the Conversion Date is at
     least a specified percentage of the Accreted Conversion Price, such
     percentage beginning at 120% for the first year following the Issue Date
     and declining 1/2% on October 10 each year thereafter, declining to 110% at
     Maturity Date;

               (b)  the long-term credit rating assigned to the Notes by either
     Moody's or S&P is reduced to below Investment Grade, or any one of these
     rating services withdraws its long-term credit rating assigned to the
     Notes;

               (c)  the Notes have been called for redemption by the Company; or

               (d)  the Company elects (i) to distribute to all holders of
Common Stock rights entitling them to purchase, for a period expiring within 60
days after the date of such distribution, Common Stock at a purchase price less
than the Sale Price at the time of such distribution, (ii) to distribute to all
holders of Common Stock assets, debt, securities or rights to purchase
securities of the Company, which distribution has a per share value as
determined by the Company's Board of Directors exceeding 15% of the Sale Price
of the Common Stock on the day preceding the declaration date for such
distribution, or (iii) in the event the Company is a party to a consolidation,
merger or binding share exchange pursuant to which the Common Stock would be
converted into cash, securities or other property, at any time from and after
the date which is 15 days

                                       A-9

<PAGE>

          prior to the anticipated effective date for the transaction until 15
          days after the actual effective date of such transaction.

              For purposes of the foregoing, "Twenty Day Average Price" means
the average of the Sale Price of the Common Stock for each Trading Day in the 20
Trading Day period ending on the last Trading Day prior to the applicable
Conversion Date, appropriately adjusted to take into account the occurrence,
during such 20 Trading Day period, of any event requiring adjustment of the
Conversion Rate under this Third Supplemental Indenture.

              In the case of the foregoing clauses (d)(i) and (ii), the Company
must notify the Holders of Notes at least 20 days prior to the ex-dividend date
for such distribution. Once the Company has given such Notice, Holders may
surrender their Notes for conversion at any time thereafter until the earlier of
the close of business on the business day prior to the ex-dividend date or the
Company's announcement that such distribution will not take place.

              If this Note is called for redemption, the Holder may convert it
at any time before the close of business on the last business day prior to the
Redemption Date. A Note in respect of which a Holder has delivered a notice of
exercise of the option to require the Company to purchase such Note or to
purchase such Note in the event of a Fundamental Change may be converted only if
the notice of exercise is withdrawn in accordance with the terms of the
Indenture.

              A Holder's right to convert Notes into shares of Common Stock is
also subject to the Company's right to elect to pay such Holder the amount of
cash set forth in the next succeeding sentence in lieu of delivering all or part
of such shares of Common Stock; provided, however, that if such payment of cash
is not permitted pursuant to the provisions of the Indenture, the Company shall
deliver shares of Common Stock (and cash in lieu of fractional shares of Common
Stock) in accordance with the Indenture, whether or not the Company has
delivered a notice pursuant to the Indenture to the effect that the Notes will
be paid in cash. The amount of cash to be paid for each $1,000 Principal Amount
of a Note shall be equal to the average Sale Price of a share of Common Stock
for the five consecutive Trading Days immediately following (i) the date of the
Company's notice of its election to deliver cash upon conversion, if the Company
shall not have given a notice of redemption pursuant to the Indenture, or (ii)
the Conversion Date, in the case of an conversion following such a notice of
redemption specifying an intent to deliver cash upon conversion, in either case
multiplied by the Conversion Rate in effect on such Conversion Date. If the
Company shall elect to make such payment wholly in shares of Common Stock, then
such shares shall be delivered through the Conversion Agent to Holders
surrendering Notes as promptly as practicable but in any event no later than the
fifth business day following the date of the Company's notice of its election to
deliver shares upon conversion. If, however, the Company shall elect to make any
portion of such payment in cash, then the payment, including any delivery of
Common Stock, shall be made to Holders surrendering Notes no later than the
tenth business day following the Conversion Date.

              The Company may not pay cash in lieu of delivering all or part of
such shares of Common Stock upon the conversion of any Note pursuant to the
terms of the Indenture (other than cash in lieu of fractional shares) if there
has occurred (prior to, on or after, as the case may

                                       A-10

<PAGE>

be, the Conversion Date or the date on which the Company delivers its notice
specifying whether each Note shall be converted into shares of Common Stock or
cash) and is continuing an Event of Default (other than a default in such
payment on such Notes).

          The initial Conversion Rate is 9.7294 shares of Common Stock per Note
with a $1,000 Principal Amount, subject to adjustment in certain events
described in the Indenture. The Company shall deliver cash or a check in lieu of
any fractional share of Common Stock.

          In the event the Company exercises its option pursuant to Section 3.9
of the Indenture to convert the Notes to Cash Pay Notes, the Holder will be
entitled on conversion to receive the same number of shares of Common Stock such
Holder would have received if the Company had not exercised such option. If the
Company exercises such option, Notes surrendered for conversion during the
period from the close of business on any Regular Record Date next preceding any
Interest Payment Date to the opening of business of such Interest Payment Date
(except Notes with respect to which the Company has mailed a notice of
redemption) must be accompanied by payment of an amount equal to the interest
thereon that the registered Holder is to receive. Except where Notes surrendered
for conversion are so surrendered after a Regular Record Date but prior to the
opening of business on the corresponding Interest Payment Date (in which case
such converting Holder shall receive a final interest payment on such Interest
Payment Date, which interest payment may be repayable to the Company upon
conversion as described in this paragraph), no interest on converted Notes will
be payable by the Company on any Interest Payment Date subsequent to the date of
conversion.

          Notes surrendered for conversion during the period from the close of
business on any date on which contingent interest accrues to the opening of
business on the date on which such contingent interest is payable (except Notes
with respect to which the Company has mailed a notice of redemption) must be
accompanied by payment of an amount equal to the contingent interest with
respect thereto that the registered Holder is to receive. Except where Notes
surrendered for conversion are so surrendered during the period from the close
of business on any date on which contingent interest accrues to the opening of
business on the date on which such contingent interest is payable (in which case
such converting Holder shall receive a final contingent interest payment on the
date such contingent interest is payable, which contingent interest payment may
been repayable to the Company upon conversion as described in this paragraph),
no contingent interest on converted Notes will accrue after the date of
conversion.

          To convert this Note a Holder must (1) complete and manually sign the
conversion notice on the back of this Note (or complete and manually sign a
facsimile of such notice) and deliver such notice to the Conversion Agent at the
office maintained by the Conversion Agent for such purpose, (2) surrender this
Note to the Conversion Agent, (3) furnish appropriate endorsements and transfer
documents if required by the Conversion Agent, the Company or the Trustee and
(4) pay any transfer or similar tax, if required.

          A Holder may convert a portion of this Note only if the Principal
Amount of such portion is $1,000 or a multiple of $1,000. No payment or
adjustment shall be made for dividends on the Common Stock except as provided in
the Indenture. On conversion of this Note, that portion of Accreted Value (or,
interest, if the Company has exercised its option provided for in paragraph 10
hereof) attributable to the period from the Issue Date (or, if the Company has

                                      A-11

<PAGE>

exercised the option referred to in paragraph 10 hereof, the later of (x) the
date of such exercise and (y) the date on which interest was last paid) to the
Conversion Date and (except as provided below) accrued contingent interest with
respect to the converted portion of this Note shall not be canceled,
extinguished or forfeited, but rather shall be deemed to be paid in full to the
Holder thereof through the delivery of the Common Stock (together with any cash
payment in lieu of fractional shares) in exchange for the portion of this Note
being converted pursuant to the terms hereof; and the fair market value of such
shares of Common Stock (together with any such cash payment in lieu of
fractional shares) shall be treated as issued, to the extent thereof, first in
exchange for Original Issue Discount accrued through the Conversion Date and
accrued contingent interest, and the balance, if any, of such fair market value
of such Common Stock (and any such cash payment) shall be treated as issued in
exchange for the Issue Price of the Note being converted pursuant to the
provisions hereof.

             10. TAX EVENT

                 (a) From and after (i) the date (the "Tax Event Date") of the
                                                       --------------
          occurrence of a Tax Event and (ii) the date the Company exercises such
          option, whichever is later (the "Option Exercise Date"), at the option
                                           --------------------
          of the Company, all of the Notes will cease to accrete, and cash
          interest shall accrue at the rate of 1.25% per annum on the restated
          principal amount (the "Restated Principal Amount"), equal to the
                                 -------------------------
          Accreted Value on the Option Exercise Date, and shall be payable
          semi-annually on October 10 and April 10 of each year (each an
          "Interest Payment Date") to holders of record at the close of business
           ---------------------
          on September 25 or March 26 (each a "Regular Record Date") immediately
                                               -------------------
          preceding such Interest Payment Date. Interest will be computed on the
          basis of a 360-day year comprised of twelve 30-day months and will
          accrue from the most recent date to which interest has been paid or,
          if no interest has been paid, from the Option Exercise Date.

                 (b) Interest on any Note that 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 Note is registered at the close of
          business on the Regular Record Date for such interest at the office or
          agency of the Company maintained for such purpose. Each installment of
          interest on any Note shall be paid in same-day funds by transfer to an
          account maintained by the payee located inside the United States.

                 (c) From and after the Option Exercise Date, contingent
          interest provided for in paragraph 5 hereof shall cease to accrue on
          this Note.

             11. DEFAULTED INTEREST

             Except as otherwise specified with respect to the Notes, any
          Defaulted Interest on any Note shall forthwith cease to be payable to
          the registered Holder thereof on the relevant Regular Record Date or
          accrual date, as the case may be, by virtue of having been such
          Holder, and such Defaulted Interest may be paid by the Company as
          provided for in Section 3.11(c)(ii) of the Indenture.

             12. DENOMINATIONS; TRANSFER; EXCHANGE

                                      A-12

<PAGE>

     The Notes are in registered form, without coupons, in denominations of
$1,000 of Principal Amount and multiplies of $1,000. A Holder may transfer or
convert Notes in accordance with the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not transfer or exchange any Notes selected for
redemption (except, in the case of a Note to be redeemed in part, the portion of
the Note not to be redeemed) or any Notes in respect of which a Purchase Notice
or Fundamental Change Purchase Notice has been given and not withdrawn (except,
in the case of a Note to be purchased in part, the portion of the Note not to be
purchased) or any Notes for a period of 15 days before any selection of Notes to
be redeemed.

     13. PERSONS DEEMED OWNERS

     The registered Holder of this Note may be treated as the owner of this Note
for all purposes.

     14. UNCLAIMED MONEY OR PROPERTY

     If money for the payment of principal or interest remains unclaimed for two
years, the Trustee or Paying Agent will pay the money back to the Company at its
request. After that, Holders entitled to the money must look to the Company for
payment unless an abandoned property law designates another person.

     15. AMENDMENT; SUPPLEMENT; WAIVER

     Subject to certain exceptions, the Indenture or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in Principal
Amount of the Outstanding Notes and any past default or compliance with any
provision relating to the Notes may be waived in a particular instance with the
consent of the Holders of a majority in Principal Amount of the Outstanding
Notes. Without the consent of any Holder, the Company and the Trustee may amend
or supplement the Indenture or the Notes to cure any ambiguity, defect or
inconsistency, to provide for uncertificated Notes in addition to or in place of
certificated Notes, to create a Series and establish its terms, or to make any
other change, provided such action does not adversely affect the rights of any
Holder.

     16. SUCCESSOR CORPORATION

     When a successor corporation assumes all the obligations of its predecessor
under the Notes and the Indenture, the predecessor corporation will be released
from those obligations.

     17. TRUSTEE DEALINGS WITH THE COMPANY

     The Chase Manhattan Bank, the Trustee under the Indenture, in its
individual or any other capacity, may make loans to, accept deposits from, and
perform services for the Company or its affiliates, and may otherwise deal with
the Company or its affiliates, as if it were not Trustee.

     18. NO RECOURSE AGAINST OTHERS

                                      A-13

<PAGE>

     A director, officer, employee or stockholder, as such, of the Company shall
not have any liability for any obligations of the Company under the Notes or the
Indenture or for any claim based on, in respect of or by reason of, such
obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for the issue of the Notes.

     19.      AUTHENTICATION

     This Note shall not be valid until the Trustee signs the certificate of
authentication on the other side of this Note.

     20.      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 Gift to Minors Act).

                                      A-14

<PAGE>
                            FORM OF CONVERSION NOTICE

To:  Electronic Data Systems Corporation

          The undersigned registered holder of this Note hereby exercises the
option to convert this Note, or portion hereof (which is $1,000 Principal Amount
or a multiple thereof) designated below, for shares of Common Stock of
Electronic Data Systems Corporation in accordance with the terms of the
Indenture referred to in this Note, and directs that the shares, if any,
issuable and deliverable upon such conversion, together with any check for cash
deliverable upon such conversion, and any Notes representing any unconverted
Principal Amount hereof, be issued and delivered to the registered holder hereof
unless a different name has been indicated below. If shares or any portion of
this Note not converted are to be issued in the name of a Person other than the
undersigned, the undersigned shall pay all transfer taxes payable with respect
thereto.

          This notice shall be deemed to be an irrevocable exercise of the
option to convert this Note.

Dated:____________________________

      ____________________________
               Signature(s)

Fill in for registration of shares if
to be delivered, and Notes if to
be issued other than to and in the
name of registered holder:

Principal Amount
to be converted (if less than all):

      ____________________________
         (Name)

      ____________________________
         (Street Address)

      ____________________________    Social Security or
         (City, state and zip code)   Other Taxpayer Number______________

      Please print name and address

                                      A-15

<PAGE>

                   FORM OF FUNDAMENTAL CHANGE PURCHASE NOTICE

To:  Electronic Data Systems Corporation

     The undersigned registered holder of this Note hereby acknowledges receipt
of a notice from Electronic Data Systems Corporation (the "Company") as to the
                                                           -------
occurrence of a Fundamental Change with respect to the Company and requests and
instructs the Company to purchase this Note, or the portion hereof (which is
$1,000 Principal Amount or a multiple thereof) designated below, in accordance
with the terms of the Indenture referred to in this Note and directs that the
check in payment for this Note or the portion thereof and any Notes representing
any unpurchased Principal Amount hereof, be issued and delivered to the
registered holder hereof unless a different name has been indicated below. If
any portion of this Note not repurchased is to be issued in the name of a Person
other than the undersigned, the undersigned shall pay all transfer taxes payable
with respect thereto.

Dated:

       _______________________________
                 Signature(s)

     Fill in for registration of shares if to be delivered, and Notes if to be
issued other than to and In the name of registered holder:

       _______________________________
                  (Name)

       _______________________________
              (Street Address)

       _______________________________
         (City, state and zip code)

        Please print name and address

                                           Principal Amount to be purchased (if
                                           less than all): $__,000

                                      A-16

<PAGE>

                                 ASSIGNMENT FORM

     If you the Holder want to assign this Note, fill in the form below:

I or we assign and transfer this Note to

__________________________________________________________

__________________________________________________________
(Insert assignee's social security or tax ID number)

__________________________________________________________

__________________________________________________________

__________________________________________________________
(Print or type assignee's name, address, and zip code)

and irrevocably appoint

__________________________________________________________

agent to transfer this Note on the books of the Company.
The agent may substitute another to act for him.

__________________________________________________________

Date: ______________   Your signature: _________________________________________
                                       (Sign exactly as your name appears on the
                                       other side of this Note)

Signature Guarantee: ___________________________________________________________
                     Signature must be guaranteed by participant in a recognized
                     Signature Guarantee Medallion Program (or other signature
                     guarantor program reasonably acceptable to the Trustee

                                      A-17

<PAGE>

                                                                       EXHIBIT B

                          PROJECTED PAYMENT SCHEDULE*

                      Period Ending                     Payment
                      -------------                     -------

                      October 10, 2001                  $0.0000
                      April 10, 2002                    $0.0000
                      October 10, 2002                  $0.0000
                      April 10, 2003                    $0.0000
                      October 10, 3003                  $0.0000
                      April 10, 2004                    $0.0000
                      October 10, 2004                  $0.0000
                      April 10, 2005                    $0.0000
                      October 10, 2005                  $0.0000
                      April 10, 2006                    $0.0000
                      October 10, 2006                  $0.0000
                      April 10, 2007                    $0.0000
                      October 10, 2007                  $0.0000
                      April 10, 2008                    $2.9188
                      October 10, 2008                  $2.9188
                      April 10, 2009                    $2.9188
                      October 10, 2009                  $2.9188
                      April 10, 2010                    $2.9188
                      October 10, 2010                  $2.9188
                      April 10, 2011                    $2.9188
                      October 10, 2011                  $2.9188
                      April 10, 2012                    $2.9188
                      October 10, 2012                  $2.9188
                      April 10, 2013                    $2.9188
                      October 10, 2013                  $2.9188
                      April 10, 2014                    $2.9188
                      October 10, 2014                  $2.9188
                      April 10, 2015                    $2.9188
                      October 10, 2015                  $2.9188
                      April 10, 2016                    $2.9705
                      October 10, 2016                  $3.1191
                      April 10, 2017                    $3.2750

___________________________

*        The comparable yield means the annual yield the Company would pay, as
         of the Issue Date, on a fixed-rate cash-pay nonconvertible debt
         security with no contingent payments but with terms and conditions
         otherwise comparable to those of the Notes, but the comparable yield
         may not be less than the "applicable Federal rate" within the meaning
         of United States Treasury regulation Section 1.275-4(b)(4)(i)(A). The
         schedule of projected payments is determined on the basis of the
         comparable yield and an assumption of linear growth of the Company's
         stock price and a constant dividend yield. The comparable yield and the
         schedule of projected payments are not determined for any purpose other
         than for the determination of interest accruals and adjustment thereof
         in respect of the Notes for United States federal income tax purposes.
         The comparable yield and the schedule of projected payments do not
         constitute a projection or representation regarding the future stock
         price or the amounts payable on the Notes.

                                       B-1

<PAGE>

                      Period Ending                Payment
                      -------------                -------

                      October 10, 2017             $    3.4388
                      April 10, 2018               $    3.6107
                      October 10, 2018             $    3.7912
                      April 10, 2019               $    3.9808
                      October 10, 2019             $    4.1798
                      April 10, 2020               $    4.3888
                      October 10, 2020             $    4.6083
                      April 10, 2021               $    4.8387
                      October 10, 2021             $2,100.0606

                                       B-2

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