Document:

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                                                                    EXHIBIT 10.1

                           PURCHASE AND SALE AGREEMENT

                                 BY AND BETWEEN

                             100 COLLEGE ROAD, LLC,
                      A DELAWARE LIMITED LIABILITY COMPANY

                                    AS SELLER

                                       AND

                             NEW VALLEY CORPORATION,
                             A DELAWARE CORPORATION

                                  AS PURCHASER

                                    PROPERTY:

                      100/150 COLLEGE ROAD OFFICE BUILDINGS
                            100/150 COLLEGE ROAD WEST
                           PRINCETON, NEW JERSEY 08540

                          DATED AS OF NOVEMBER 27, 2002

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                           PURCHASE AND SALE AGREEMENT

         THIS PURCHASE AND SALE AGREEMENT (this "AGREEMENT") dated as of the
27th day of November, 2002, is made by and between 100 COLLEGE ROAD, LLC, a
Delaware limited liability company ("SELLER") with an office at 1980 Post Oak
Boulevard, Suite 1600, Houston, Texas 77056 and NEW VALLEY CORPORATION, a
Delaware corporation ("PURCHASER"), with an office at 100 S.E. Second Street,
32nd Floor, Miama, Florida 33131.

                                R E C I T A L S :
                                - - - - - - - -

         Seller desires to sell those two (2) certain tracts of improved real
property commonly known as the 100 College Road Office Building located at 100
College Road West, Princeton, Plainsboro Township, Middlesex County, New Jersey
08540 (the "100 COLLEGE ROAD BUILDING") and the 150 College Road Office Building
located at 150 College Road West, Princeton, Plainsboro Township, Middlesex
County, New Jersey 08540 (the "150 COLLEGE ROAD BUILDING"), along with all
related personal and intangible property, and Purchaser desires to purchase such
real, personal and intangible property (the 100 College Road Building and the
150 College Road Building are collectively referred to herein as the
"BUILDINGS").

         NOW, THEREFORE, in consideration of the foregoing, of the covenants,
promises and undertakings set forth herein, and for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Seller and Purchaser agree as follows:

1.       THE PROPERTY.

         1.1 DESCRIPTION. Subject to the terms and conditions of this Agreement,
and for the consideration herein set forth, Seller agrees to sell and transfer,
and Purchaser agrees to purchase and acquire, all of Seller's right, title, and
interest in and to the following (collectively, the "PROPERTY"):

                  (a) That certain land ("100 COLLEGE ROAD LAND") located in
Princeton, Plainsboro Township, Middlesex County, New Jersey and more
specifically described in EXHIBIT A-1 attached hereto and that certain land
("150 COLLEGE ROAD LAND") located in Princeton, Plainsboro Township, Middlesex
County, New Jersey and more specifically described in EXHIBIT A-2 attached
hereto (the 100 College Road Land and the 150 College Road Land are collectively
referred to herein as the "LAND");

                  (b) The 100 College Road Building, parking areas, if any, all
other improvements, and fixtures now and at the Closing (as hereinafter defined)
situated on the 100 College Road Land (the "100 COLLEGE ROAD IMPROVEMENTS") and
the 150 College Road Building, parking areas, if any, all other improvements,
and fixtures now and at the Closing situated on the 150 College Road Land (the
"150 COLLEGE ROAD IMPROVEMENTS") (the 100 College Road Improvements and the 150
College Road Improvements are collectively referred to herein as the
"IMPROVEMENTS");

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                  (c) All furniture, personal property, machinery, systems,
apparatus, and equipment and other personal property owned by Seller and DLM
Leasing, LLC and currently and at the Closing used in the operation, repair and
maintenance of the Land and the Improvements and situated thereon (collectively,
the "PERSONAL PROPERTY"), which Personal Property is listed on EXHIBIT B
attached hereto. The Personal Property shall not include any personal property
owned by Seller's property manager and located within Suite 150 of the 150
College Road Building. The Personal Property to be conveyed is subject to
depletions, replacements and additions in the ordinary course of business;

                  (d) All easements, hereditaments, and appurtenances belonging
to or inuring to the benefit of Seller and pertaining to the Land and the
Improvements, if any;

                  (e) Any street or road abutting the Land to the center lines
thereof;

                  (f) Those certain space leases, licenses and occupancy
agreements in effect on the date of this Agreement which are identified on the
Schedule of Leases attached hereto as EXHIBIT C, and any new space leases
entered into pursuant to Section 4.4, which as of the Closing (as hereinafter
defined) affect all or any portion of the Land or the Improvements
(collectively, "LEASES"), and any security deposits (in the form of cash or
letters of credit or otherwise) actually held by Seller (or Seller's mortgagee)
as of the Closing with respect to any such Leases;

                  (g) All intangible personal property owned by Seller and used
or useful in connection with the Land, the Improvements and/or the Personal
Property including, without limitation, any trademarks, trade names and
copyrights, plans and specifications prepared in connection with the
construction of the Improvements, certificates of occupancy and any other
certificates of operation, floor plans, booklets and manuals relating to the
operation of the Improvements and the Personal Property, advertising materials,
contract rights, licenses and permits now and at the Closing in effect with
respect to the Improvements and the Personal Property (collectively, the
"INTANGIBLE PERSONAL PROPERTY"), to the extent such Intangible Personal Property
may be assignable or otherwise transferable by law;

                  (h) Subject to Section 3.4, all assignable contracts and
agreements relating to the operation, repair or maintenance of the Land, the
Improvements or the Personal Property the terms of which extend beyond midnight
of the day preceding the Closing Date (as hereinafter defined);

                  (i) Assignable warranties and guaranties issued in connection
with the Improvements or the Personal Property; and

                  (j) All transferable consents, applications, authorizations,
variances or waivers, licenses, permits and approvals from any governmental or
quasi-governmental agency, department, board, commission, bureau or other entity
or instrumentality solely in respect of the Land or the Improvements
(collectively, "APPROVALS").

         1.2 "AS-IS" PURCHASE. Except for the representations and warranties
expressly set forth in this Agreement, the Property is being sold in an "AS IS"
condition and "WITH ALL FAULTS" as of the date of this Agreement and, subject to

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reasonable wear and tear, as of the Closing Date. Except as expressly set forth
in this Agreement, no representations or warranties have been made or are made
and no responsibility has been or is assumed by Seller or by any partner,
officer, person, firm, agent or representative acting or purporting to act on
behalf of Seller as to the condition or repair of the Property or the value,
expense of operation, or income potential thereof or as to any other fact or
condition which has or might affect the Property or the condition, repair,
value, expense of operation or income potential of the Property or any portion
thereof, including, without limitation, (i) matters of title, (ii) environmental
matters relating to the Property or any portion thereof, (iii) geological
conditions, including, without limitation, subsurface conditions, (iv) drainage,
(v) soil conditions, including the existence of instability, past soil repairs,
soil additions or conditions of soil fill, or the sufficiency of any
undershoring, (vi) the availability of any utilities to the Property or any
portion thereof including, without limitation, water, sewage, gas and electric,
(vii) zoning to which the Property or any portion thereof may be subject, (viii)
usages of adjoining property, (ix) access to the Property or any portion
thereof, (x) the value, compliance with the plans and specifications, size,
location, age, use, design, quality, description, suitability, structural
integrity, operation, title to, or physical or financial condition of the
Property or any portion thereof, (xi) the existence or non-existence of
underground storage tanks, (xii) tax consequences or (xiii) the merchantability
of the Property or fitness of the Property for any particular purpose. The
parties agree that all understandings and agreements heretofore made between
them or their respective agents or representatives are merged in this Agreement,
other than the Confidentiality and Inspection Agreement (as hereinafter defined)
referred to in Section 3.1 hereof, and the Exhibits attached hereto, which alone
fully and completely express their agreement, and that this Agreement has been
entered into after full investigation, or with the parties satisfied with the
opportunity heretofore and hereafter afforded for investigation, neither party
relying upon any statement or representation by the other unless such statement
or representation is specifically embodied in this Agreement or the Exhibits
attached hereto. Except for the representations and warranties expressly set
forth in this Agreement, Seller makes no representations or warranties as to
whether the Property contains asbestos or harmful or toxic substances or
pertaining to the extent, location or nature of same. Further, to the extent
that Seller has provided or hereafter may provide to Purchaser information from
any inspection, engineering or environmental reports concerning asbestos,
dieldrin or harmful or toxic substances, Seller makes no representations or
warranties with respect to the accuracy or completeness, methodology of
preparation or otherwise concerning the contents of such reports, except for the
representations and warranties expressly set forth in this Agreement. Purchaser
acknowledges that Seller has requested Purchaser to inspect fully the Property
and investigate all matters relevant thereto and, except for the representations
and warranties expressly set forth in this Agreement, to rely solely upon the
results of Purchaser's own inspections or other information obtained or
otherwise available to Purchaser, rather than any information that may have been

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provided by Seller to Purchaser. The risk that adverse physical and
environmental conditions may not have been revealed or discovered and may not be
discoverable by such investigations shall be upon and with Purchaser. Purchaser
hereby waives and releases Seller from any present or future claims arising from
or relating to the presence or alleged presence of asbestos, dieldrin or harmful
or toxic substances in, on, under or about the Property including, without
limitation, any claims under or on account of (i) any federal, state or local
statute, law, rule, regulation, ordinance, code, guide, written policy,
directive and rule of common law in effect applicable to the Property and in
each case as amended, and any judicial or administrative order, consent decree
or judgment, relating to (x) the environment or natural resources, (y) any
petroleum or petroleum products, radioactive materials, asbestos in any form,
dieldrin, polycholorinated biphenyls, and, to the extent only it exists at
levels considered hazardous to human health, radon gas or (z) any chemicals,
materials or substances defined as or included in the definition of "hazardous
substances", hazardous waste", "hazardous materials", "extremely hazardous
substances", "toxic substances", "toxic pollutants", "contaminants" or
"pollutants" under any applicable environmental laws including, without
limitation, the Comprehensive Environmental Response, Compensation and Liability
Act, 42 U.S.C. ss. 9601 et seq.; Solid Waste Disposal Act, 42 U.S.C. ss. 6901 et
seq.; the Federal Water Pollution Control Act, 33 U.S.C. ss. 1251 et seq.; the
Toxic Substances Control Act, 15 U.S.C. ss. 7401 et seq.; the Clean Air Act, 42
U.S.C. ss. 7401 et seq.; the Safe Drinking Water Act, 42 U.S.C. ss. 3803 et
seq.; the Oil Pollution Act of 1990, 33 U.S.C. ss. 2701 et seq.; Federal
Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. ss. 136 et seq., and the
regulations promulgated pursuant thereto and any state and local counterparts or
substantial equivalents thereof, (ii) this Agreement or (iii) the common law.
Purchaser acknowledges that the Purchase Price (as hereinafter defined) reflects
the "as-is" nature of this sale and any faults, liabilities, defects or other
adverse matters that may be associated with the Property. Purchaser has fully
reviewed the disclaimers and waivers set forth in this Agreement with its
counsel and understands the significance and effect thereof. The terms and
provisions of this Section 1.2 shall survive the Closing or any termination of
this Agreement.

         1.3 AGREEMENT TO CONVEY. Seller agrees to convey, and Purchaser agrees
to accept, title to the Land and Improvements by special or limited warranty
deed and title to the Personal Property, by bill of sale, with warranty as to
the title and without warranty as to the condition of such personalty.

2.       PRICE AND PAYMENT.

         2.1. PURCHASE PRICE. The purchase price for the Property ("PURCHASE
PRICE") is FIFTY-FOUR MILLION AND/NO DOLLARS ($54,000,000.00). The parties
acknowledge and agree that no portion of the Purchase Price is for or allocated
to the Personal Property.

         2.2. PAYMENT. Payment of the Purchase Price is to be made as follows:

                  (a) Within two (2) business days after the Effective Date (as
hereinafter defined), Purchaser shall deliver an earnest money deposit of ONE
MILLION AND/NO DOLLARS ($1,000,000.00) (the "DEPOSIT") by wire transfer of
Federal funds credited to the account of First American Title Insurance Company,
633 Third Avenue, New York, New York 10017, Attention: Jeffrey S. Mitzner (the
"LEAD TITLE COMPANY"). Lead Title Company and any other title company which is
co-insuring title to the Property are collectively referred to herein as the
"TITLE COMPANY". The Deposit will be placed and held in escrow by Lead Title
Company in an interest-bearing account at a mutually acceptable banking
institution. All interest earned on the Deposit shall be considered as part of
the Deposit. Except as otherwise provided in this Agreement, the Deposit will be
applied to the Purchase Price at the Closing. As used herein , the term

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"EFFECTIVE DATE" shall mean the date that this Agreement is executed and
exchanged by Seller and Purchaser (or their counsel), as identified on the
signature page of this Agreement. Notwithstanding anything else contained herein
to the contrary, Purchaser shall have the right to substitute another title
company as "Lead Title Company" by providing written notice of such substitution
to Seller prior to December 1, 2002; provided, however, such substitute title
company must be acceptable to Seller, in Seller's reasonable discretion. Upon
Seller's approval of such substitute title company, the substitute title company
shall assume, in writing, all of the obligations and duties of Lead Title
Company under this Agreement and the existing Lead Title Company shall then
transfer the Deposit to such substitute title company, which funds shall be held
by such substitute title company in accordance with the terms and provisions of
this Agreement.

                  (b) At the Closing, the Purchaser shall pay to Seller the
balance of the Purchase Price (the "BALANCE OF THE PURCHASE PRICE") and Lead
Title Company shall pay to Seller the Deposit, which collectively shall be
subject to adjustments as provided herein, such payments to be made to a bank
account designated in writing at least two (2) business days prior to Closing by
Seller by wire transfer of Federal funds.

         2.3. CLOSING. Payment of the Purchase Price and the closing hereunder
(the "CLOSING") will take place pursuant to a "New York style" closing in escrow
at the offices of the Title Company at 10:00 a.m. E.S.T. on or before December
16, 2002; provided, however, Purchaser shall have the right to extend such date
until December 20, 2002 by delivering written notice of such extension to Seller
on or before December 12, 2002 (the aforesaid date, or such other agreed date,
being referred to in this Agreement as the "CLOSING DATE"). Buyer and Seller
shall use reasonable efforts to close this transaction at the earliest possible
date, but in any event prior to December 16, 2002 and Seller and Buyer shall
cooperate in all reasonable respects in order to accomplish an earlier closing.

3.       INSPECTIONS AND APPROVALS.

         3.1. INSPECTIONS. (a) Pursuant to the Confidentiality and Inspection
Agreement, a copy of which is attached hereto as EXHIBIT D, previously entered
into by Seller and Purchaser (the "CONFIDENTIALITY AND INSPECTION AGREEMENT"),
Seller has allowed and will continue to allow Purchaser and the Representatives
(as defined in the Confidentiality and Inspection Agreement) reasonable access
to the Property (during business hours) for purposes of physical engineering
inspection ("ENGINEERING INSPECTION") or environmental inspection
("ENVIRONMENTAL INSPECTION") of the Property (including an inspection of the
Property for the presence of lead-based paint or lead-based paint hazards) in
accordance with the terms of the Confidentiality and Inspection Agreement.
Purchaser shall continue to have the right to continue its review of the
Evaluation Materials (as defined in the Confidentiality and Inspection
Agreement) as provided in the Confidentiality and Inspection Agreement.

                  (b) Except for the representations and warranties expressly
set forth in this Agreement, Seller makes no representations or warranties as to
the truth, accuracy or completeness of the Evaluation Materials (E.G., that the
Evaluation Materials are complete, accurate or the final version thereof, or
that all similar Evaluation Materials are in Seller's possession). It is the

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parties' express understanding and agreement that the Evaluation Materials are
provided only for Purchaser's convenience in making its own examination and
determination as to whether it wishes to purchase the Property, and, in doing
so, except for the representations and warranties expressly set forth in this
Agreement, Purchaser has relied exclusively on its own independent investigation
and evaluation of every aspect of the Property and not on any materials supplied
by Seller. Purchaser expressly disclaims any intent to rely on the Evaluation
Materials in connection with its inspection and agrees that, except for the
representations and warranties expressly set forth in this Agreement, it shall
rely solely on its own independently developed or verified information.

         3.2. ENVIRONMENTAL REPORTS/STUDIES. Prior to or contemporaneously with
execution of this Agreement, Seller has caused to be delivered to Purchaser the
environmental reports/studies identified on EXHIBIT E attached hereto
(collectively, the "ENVIRONMENTAL REPORTS").

         3.3. TITLE AND SURVEY. Prior to the execution of this Agreement, Seller
has caused to be delivered to Purchaser (i) a commitment for title insurance
("TITLE COMMITMENT") for an owner's title insurance policy insuring Seller's
interest in the Land and the Improvements, together with copies of all items
shown as exceptions to title therein, issued by the Lead Title Company and
identified as Commitment No. ST02-34657 a copy of which Title Commitment
(excluding copies of all items shown as exceptions therein) is attached hereto
as EXHIBIT F, (ii) a survey ("100 COLLEGE ROAD SURVEY") of the 100 College Road
Land dated September 7, 1999, last updated May 3, 2001, prepared by Copeland
Surveying, Inc. and (iii) a survey ("150 COLLEGE ROAD SURVEY") of the 150
College Road Land dated January 5, 2002, last updated February 5, 2002, prepared
by Schoor DePalma (the 100 College Road Survey and the 150 College Road Survey
are collectively referred to herein as the "SURVEYS"). By its execution of this
Agreement, Purchaser acknowledges and agrees that Purchaser shall take title to
the Property subject to the matters (the "PERMITTED ENCUMBRANCES") shown on
EXHIBIT G attached hereto.

         3.4 CONTRACTS. On or before December 6, 2002, Purchaser shall notify
Seller in writing if Purchaser elects not to assume at the Closing any of the
terminable service, maintenance, supply or other contracts relating to the
operation of the Property which are identified on EXHIBIT H attached hereto.
Seller shall give notice of termination of such disapproved contract(s);
PROVIDED, if by the terms of the disapproved contract(s) Seller has no right to
terminate same on or prior to the Closing, or if any fee or other compensation
is due by the terms of the disapproved contract(s) as a result of such
termination, Purchaser shall be required at the Closing to assume all
obligations thereunder until the effective date of the termination and to assume
the obligation to pay or to reimburse Seller for the payment of the termination
related charge. Without limiting the generality of the foregoing, Purchaser
shall, subject to the proration adjustments set forth in Section 6.3 below, be
required to assume the contracts relating to the operation of the Property which
are identified on EXHIBIT I attached hereto and in the event Purchaser after the
Closing terminates any such contract it shall pay any compensation payable under
or in respect of any such contract. The provisions of this Section 3.4 shall
survive the Closing.

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         3.5 INTENTIONALLY DELETED.

         3.6 CONFIDENTIALITY. Unless Seller otherwise agrees in writing,
Purchaser agrees that all information regarding the Property of whatsoever
nature made available to it by Seller or its agents or representatives
("PROPRIETARY INFORMATION") is confidential and shall be governed by the terms
of the Confidentiality and Inspection Agreement. Purchaser acknowledges and
agrees that the terms of the Confidentiality and Inspection Agreement shall
survive (to the extent specifically and expressly provided in the
Confidentiality and Inspection Agreement) any termination of this Agreement.

4.       PRIOR TO CLOSING.

         Until the Closing, Seller shall:

                  4.1. INSURANCE. Keep the Property insured against fire and
other hazards covered by an all risk policy and comprehensive public liability
insurance against claims for bodily injury, death and property damage occurring
in, on or about the Property at the same levels currently in effect.

                  4.2. OPERATION. Operate and maintain the Property in a good
and businesslike manner and substantially in accordance with Seller's past and
current practices with respect to the Property, and make any and all repairs and
replacements reasonably required to deliver the Property to Purchaser at the
Closing in its condition as of the date of this Agreement, normal wear and tear
excepted, provided that in the event of any loss or damage to the Property,
Seller's obligation to Purchaser to repair the Property shall be as provided in
Section 7 hereof.

                  4.3. NEW CONTRACTS. Enter into only those third party
contracts which are necessary to carry out its obligations under Section 4.2 and
which shall be cancelable on thirty (30) days' written notice without premium or
penalty. If Seller enters into any such contract, it shall promptly provide
written notice and a copy thereof to Purchaser and unless Purchaser, within
seven (7) days after receipt thereof, notifies Seller in writing of its
intention to assume such contract, it shall be treated as a contract disapproved
by Purchaser under Section 3.4 hereof.

                  4.4. NEW LEASES. Continue the present rental program and
efforts at the Property to rent vacant space, provided that: (a) except for the
pending lease amendment with Novo Nordisk Pharmaceuticals, Inc. (the "NOVO
AMENDMENT") and the pending lease termination with Broadbeam Corporation (the
"BROADBEAM TERMINATION"), both as identified on EXHIBIT J attached hereto, after
the Effective Date, Seller will not execute any new space leases, occupancy
agreements or licenses or amend, terminate or accept the surrender of any
existing tenancies or approve any space sub-leases without the prior written
consent of Purchaser, which consent may be withheld by Purchaser, in Purchaser's
sole discretion, except that the Seller is authorized to accept the termination
of leases, occupancy agreements and licenses at the end of their existing terms;
and (b) at Closing, Purchaser shall reimburse Seller for $18,716.81 of the
leasing commissions paid by Seller in connection with the Novo Amendment. Seller

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shall retain the right to receive the payment of the termination fee payable by
Broadbeam Corporation in connection with the Broadbeam Termination. Failure of
Purchaser to consent or expressly withhold its consent stating with specificity
the basis of its objection within two (2) business days after its receipt of
written request for such consent shall be deemed to constitute Purchaser's
withholding of consent.

         4.5. FIRE SUPPRESSION SYSTEM. Use its diligent efforts to obtain
written confirmation from Novo Nordisk Pharmaceuticals, Inc. ("NOVO") that the
existing violation identified on EXHIBIT N attached hereto with regard to the
non-compliance of the fire suppression system located within Novo's leased
premises is the responsibility of Novo as tenant under its Lease.

5.       REPRESENTATIONS AND WARRANTIES; BROKERAGE; CONDITIONS PRECEDENT.

         5.1. BY SELLER. Seller represents and warrants to Purchaser that:

                  (a) ORGANIZATION AND AUTHORIZATION. Seller is a limited
liability company duly organized, validly existing and in good standing under
the laws of the State of Delaware, is duly authorized to do business in the
State of New Jersey has duly authorized the execution and performance of this
Agreement, and such execution and performance will not violate any material term
of its limited liability company agreement, nor contravene any judgment, order,
decree, writ or injunction, or any provision of any existing law or regulation
or other agreement by which Seller is bound.

                  (b) VALIDITY AND ENFORCEABILITY. Assuming that this Agreement
constitutes a legal, valid and binding obligation of Purchaser, this Agreement
constitutes, and all documents executed by Seller hereunder or in connection
herewith will each constitute, the legal, valid and binding obligations of
Seller, enforceable in accordance with their respective terms, covenants and
conditions, subject to bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditor's rights generally, and
except as may be limited by applicable laws, general equitable principles or
judicial decisions which may qualify, limit or preclude certain rights, remedies
or provisions contained in this Agreement and/or any documents executed by
Seller hereunder.

                  (c) CONSENTS AND APPROVALS. No consent, approval,
authorization, license or order of, registration or filing with, or notice to,
any governmental entity or any other person is necessary to be obtained, made or
given by Seller in connection with the execution and delivery of this Agreement,
the performance by Seller of its obligations hereunder or the consummation by
Seller of the transactions contemplated hereby.

                  (d) LEGAL PROCEEDINGS. Except as may be specifically disclosed
in the Evaluation Materials and referred to on EXHIBIT K attached hereto, there
is no action, suit, claim, proceeding or other investigation pending, or to the
actual knowledge of Seller, threatened against Seller before any court, other
governmental entity or arbitrator that affects any portion of the Property or
that would otherwise affect the ability of Seller to perform its obligations
under this Agreement.

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                  (e) BANKRUPTCY. No petition in bankruptcy (voluntary or
otherwise), assignment for the benefit of creditors, or petition seeking
reorganization or arrangement or other action under federal or state bankruptcy
laws is pending against or contemplated by Seller.

                  (f) RENT ROLL. To Seller's knowledge, all information set
forth on the rent rolls attached hereto as EXHIBIT L is true and correct in all
material respects as of its date.

                  (g) LEASES. To Seller's knowledge, there are no leases,
licenses, tenancies, subleases, subtenancies or occupancy agreements of kind of
any space in the Property except as set forth on the list of Leases attached
hereto as EXHIBIT C. Seller has furnished true, correct and complete copies of
all of the Leases and modifications and amendments thereof to Purchaser.

                  (h) OPERATING STATEMENTS. To Seller's knowledge, the operating
statements for the Property for calendar years 2001 and year-to-date 2002,
copies of which are attached hereto as EXHIBIT M, are true, correct and complete
in all material respects.

                  (i) ENVIRONMENTAL. The Environmental Reports listed on EXHIBIT
E are all of the environmental reports in Seller's possession or control
relating to the Property. Seller has no knowledge of any condition at the
Property which would constitute a violation of Environmental Laws (as
hereinafter defined) related to the Property or the presence or release of
Hazardous Materials on or from the Property except as disclosed in the
Environmental Reports and the Evaluation Materials.

                  (j) WITHHOLDING OBLIGATION. Seller's sale of the Property is
not subject to any federal, state or local withholding obligation of Purchaser
under the tax laws applicable to Seller or the Property.

                  (k) VIOLATIONS. To Seller's knowledge, except as set forth on
EXHIBIT N attached hereto, Seller has not received written notice of any uncured
violation of any federal, state or local law relating to the use or operation of
the Property and Seller has no knowledge of any condition at the Property which
would constitute a violation of any federal, state or local law relating to the
use or operation of the Property.

                  (l) CONDEMNATION. There are no condemnation proceedings
pending against the Property or any portion thereof, and Seller has not received
written notice of any threatened condemnation of all or any part of the
Property.

                  (m) NON-FOREIGN PERSON. Seller is not a "foreign person"
within the meaning of Section 1445 of the Internal Revenue Code of 1986, as
amended, and the regulations promulgated thereunder.

                  (n) All of the Leases are in force and effect.

                  (o) EXHIBIT O attached hereto sets forth the insurance
coverage currently maintained by Seller with respect to the Property.

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                  (p) There is no property assessment appeal proceeding pending
for a reduction of the real estate taxes assessed against the Property.

                  (q) To Seller's knowledge, Seller has not received any written
notice that any of the certificates of occupancy issued in connection with the
ownership, use and occupancy of the Property has been suspended or revoked.

                  (r) The only written agreements for the payment of leasing
brokerage commissions in connection with the Leases are listed on EXHIBIT P
attached hereto (the "BROKERAGE AGREEMENTS"). To Seller's knowledge, Seller has
delivered to Purchaser true and correct copies of the Brokerage Agreements. All
leasing commissions payable by Seller, as the landlord under the Leases, with
respect to the current lease terms under the Leases have been fully paid by
Seller; provided, however, to the extent the Novo Amendment is executed prior to
Closing, the leasing commissions due with respect to the Novo Amendment shall
not be due and payable until the effective date of the Novo Amendment.

                  (s) The Personal Property is owned by Seller or DLM Leasing,
LLC, as the case may be, free and clear of any conditional bills of sale,
chattel mortgages, security agreements, pledge agreements, financing statements
or other security interests, and any liens or encumbrances of any kind, except
for those financing statements and security interests of Fleet Bank, which are
to be released as of the Closing.

                  (t) To Seller's knowledge, Seller has not received written
notice of any general or special assessment against the Property for public
improvements constructed prior to the date hereof, except such as have
heretofore been paid.

                  (u) Seller does not have any employees and Seller is not a
party to any union contracts affecting the Property, other than the janitorial
contract with Allan Industries.

                  (v) To Seller's knowledge, no person, firm or entity has any
right of first refusal or any other preferential right to acquire the Property
or any part thereof, other than the purchase right of The Trustees of Princeton
University (the "TRUSTEES") as set forth in the Amended and Restated Declaration
of Easements, Covenants, Conditions and Restrictions of the Initial Village
South Parcel (Block 3, Lot 1.61) and the Amended and Restated Declaration of
Easements, Covenants, Conditions and Restrictions of the Village South Parcel II
(Block 3, Lot 1.62), which purchase right has been waived by The Trustees as to
this transaction pursuant to that certain letter from Seller to the Trustees
dated October 3, 2002.

         5.2. BY PURCHASER. Purchaser represents and warrants to Seller that:

                  (a) ORGANIZATION AND AUTHORIZATION. Purchaser is a Delaware
corporation, duly organized, validly existing and in good standing under the
laws of such State, has duly authorized the execution and performance of this
Agreement, and such execution and performance will not violate any material term
of any of its constitutive documents; nor violate any other agreement by which
Purchaser is bound; nor contravene any judgment, decree, writ or injunction, or

                                      -10-
<PAGE>

any provision of any exiting law or regulation. Purchaser is acting as principal
in this transaction with authority to close the transaction.

                  (b) BANKRUPTCY. No petition in bankruptcy (voluntary or
otherwise), assignment for the benefit of creditors, or petition seeking
reorganization or arrangement or other action under federal or state bankruptcy
laws is pending against or contemplated by Purchaser.

                  (c) VALIDITY AND ENFORCEABILITY. Assuming that this Agreement
constitutes a legal, valid and binding obligation of Seller, this Agreement
constitutes, and all documents executed by Purchaser hereunder or in connection
herewith will each constitute, the legal, valid and binding obligations of
Purchaser, enforceable in accordance with their respective terms, covenants and
conditions, subject to bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditor's rights generally, and
except as may be limited by applicable laws, general equitable principles or
judicial decisions which may qualify, limit or preclude certain rights, remedies
or provisions contained in this Agreement and/or any documents executed by
Purchaser hereunder.

                  (d) CONSENTS AND APPROVALS. No consent, approval,
authorization, license or order of, registration or filing (other than the press
release or public disclosure contemplated under Section 11.8) with, or notice
to, any governmental entity or any other person is necessary to be obtained,
made or given by Purchaser in connection with the execution and delivery of this
Agreement, the performance by Purchaser of its obligations hereunder or the
consummation by Purchaser of the transactions contemplated hereby.

                  (e) LEGAL PROCEEDINGS. Except as may be specifically disclosed
herein, there is no action, suit, claim, proceeding or other investigation
pending, or to the actual knowledge of Purchaser, threatened against Purchaser
before any court, other governmental entity or arbitrator that would affect the
ability of Purchaser to perform its obligations under this Agreement.

                  (f) SOPHISTICATION OF PURCHASER. Purchaser has knowledge and
experience in financial and business matters and is capable of evaluating the
merits and risks of the transactions contemplated by this Agreement.

All of the representations, warranties and agreements of Purchaser set forth in
this Agreement will survive the Closing. The acceptance of the Deed by Purchaser
shall be deemed an acknowledgement by Purchaser that Seller has fully performed,
discharged and complied with all of Seller's obligations, representations,
warranties, covenants and agreements hereunder, that Seller is discharged
therefrom and that Seller shall have no further liability with respect thereof,
except for (i) the post-closing adjustments, if any required by Section 6.3
hereof and (ii) those, if any, which are herein specifically stated in this
Agreement to survive the Closing.

         5.3. BROKERAGE. Seller, on the one hand, and Purchaser, on the other
hand, represent to the other that it has had no dealings, negotiations, or
consultations with any broker, finder, representative, agent or other
intermediary except Crimson Financial Services, LLC ("CRIMSON") and Cushman &
Wakefield ("C&W") in connection with this Agreement or the sale of the Property.
Seller and Purchaser agree that each will indemnify, defend and hold the other

                                      -11-
<PAGE>

free and harmless from the claims of any other broker(s), representative(s),
employee(s), agent(s) or other intermediary(ies) claiming to have represented
Seller or Purchaser, respectively, or otherwise to be entitled to compensation
in connection with this Agreement or in connection with the sale of the
Property. Seller agrees to pay any fee, brokerage commission or other
compensation due to Crimson and C&W pursuant to a separate agreement between
Seller, Crimson and C&W. The provisions of this Section 5.3 shall survive the
termination of this Agreement or the Closing.

         5.4. CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS. Seller's obligations
hereunder are subject to the satisfaction of the following conditions precedent
which may be waived in whole or in part by Seller:

                  (a) Purchaser shall have paid the Balance of the Purchase
Price pursuant to the terms hereof.

                  (b) Purchaser shall have delivered to or for the benefit of
Seller, on or before the Closing Date, all of the documents and items required
of the Purchaser pursuant to Section 9.2 hereof, and Purchaser shall have
performed in all material respects the material covenants and obligations
required to be performed by Purchaser under this Agreement through the Closing
Date.

                  (c) All of Purchaser's representations and warranties made in
this Agreement shall be true and correct in all material respects as of the date
hereof and as of the Closing Date as if then made (except where such
representations and warranties were expressly meant to be true as of an earlier
date).

         5.5. CONDITIONS PRECEDENT TO PURCHASER'S OBLIGATIONS. Purchaser's
obligations hereunder are subject to the satisfaction of the following
conditions precedent which may be waived in whole or in part by Purchaser:

                  (a) Seller shall have delivered to or for the benefit of
Purchaser, on or before the Closing Date, all of the documents and items
required of the Seller pursuant to Section 9.1 hereof, and Seller shall have
performed in all material respects the material covenants and obligations
required to be performed by Seller under this Agreement through the Closing
Date.

                  (b) All of Seller's representations and warranties made in
this Agreement shall be true and correct in all material respects as of the date
hereof and as of the Closing Date as if then made (except where such
representations and warranties were expressly meant to be true as of an earlier
date).

6.       COSTS AND PRORATIONS.

         6.1. PURCHASER'S COSTS. Purchaser will pay the following costs of
closing this transaction:

                                      -12-
<PAGE>

                  (a) the fees and disbursements of its counsel, mortgage
broker, inspecting architect, engineer and environmental consultant, if any, and
any other party retained by Purchaser;

                  (b) any sales or use taxes relating to the transfer of
personal property to Purchaser;

                  (c) the cost of an ALTA owner's title insurance policy (and
any commitment relating thereto) and any mortgagee's title insurance policy,
issued in connection with this transaction, whether pursuant to the Title
Commitments or otherwise including, any additional premium charge(s) for
endorsements and/or deletion(s) of exception items and any cancellation
charge(s) imposed by any title company in the event a title insurance policy is
not issued, unless caused by willful default of Seller hereunder;

                  (d) the costs of any survey work or changes or additions to
the Surveys requested by Purchaser to the extent the survey work or the Surveys
made available by the Seller are not acceptable to the Purchaser, and/or the
costs of any new survey desired by Purchaser;

                  (e) $18,716.81 of the leasing commissions payable by Seller in
connection with the Novo Amendment pursuant to Section 4.4(b) above;

                  (f) any other expense(s) incurred by Purchaser or its
representatives in inspecting or evaluating the Property or closing this
transaction; and

                  (g) all other charges customarily paid by purchasers in the
jurisdiction where the Property is located, except to the extent Seller is
obligated in Section 6.2 hereof to pay such charges.

         6.2. SELLER'S COSTS. Seller will pay the following costs of closing
this transaction:

                  (a) transfer, stamp or documentary tax(es) or similar
conveyance fees;

                  (b) the fees and disbursements of its counsel;

                  (c) the fee to Crimson and C&W to the extent any such fee is
payable pursuant to Seller's separate agreements with Crimson and C&W;and

                  (d) all other charges customarily paid by sellers in the
jurisdiction where the Property is located, except to the extent Purchaser is
obligated in Section 6.1 hereof to pay such charges.

         6.3. APPORTIONMENTS. (a) The following are to be apportioned between
Seller and Purchaser as of 11:59 p.m. E.S.T. on the date immediately preceding
the Closing Date (except as otherwise expressly provided below) and the net
amount thereof shall (a) if owed to Seller, be paid by Purchaser to Seller or
(b) if owed to Purchaser, be credited by Seller against the Balance of the
Purchase Price, as the case may be, at the Closing:

                                      -13-
<PAGE>

                  (i)      real property taxes; provided that if, on the Closing
                           Date, the Land and/or the Building or any part
                           thereof shall be affected by any real property taxes
                           or other assessments which are payable in
                           installments, then installments payable prior to the
                           Closing Date shall be paid by Seller (subject to
                           apportionment as provided for herein), and
                           installments payable after the Closing Date shall be
                           paid by Purchaser (subject to apportionment as
                           provided herein) and provided further that any
                           assessment which can be paid by either a single lump
                           sum payment or in installments shall be deemed
                           payable in installments;

                  (iii)    water rates and charges;

                  (iv)     sewer taxes and rents;

                  (v)      vault taxes or fees;

                  (vi)     charges and payments under any service, maintenance,
                           supply or other contracts entered into by Seller
                           which Purchaser has elected to assume as provided in
                           Section 3.4;

                  (vii)    annual permit, license and inspection fees, if any,
                           on the basis of the fiscal year for which levied, if
                           rights thereunder with respect thereto are
                           transferable to Purchaser;

                  (viii)   electricity, fuel, steam and all other utilities
                           (with credit to Seller by Purchaser for the amount of
                           any assignable deposits, together with any interest
                           earned thereon and not previously paid to Seller with
                           respect to the period prior to the Closing, with
                           utility companies which shall not be refunded to
                           Seller on or after the Closing and which shall
                           benefit Purchaser);

                  (ix)     brokerage commission obligations in respect of the
                           Leases, which obligations shall be apportioned and
                           assigned in accordance with the terms of this
                           Agreement; it being acknowledged and agreed by Seller
                           and Purchaser that Section 4.4 provides that certain
                           brokerage commission obligations shall be assumed by
                           Purchaser even though such obligations have been
                           incurred by Seller prior to the Closing Date;

                  (x)      base rent, additional rent, license fees and other
                           amounts due to landlord under the Leases
                           (collectively, the "RENT"), on the basis that the
                           portion of the Rent actually ---- received consisting
                           of additional rent, escalation rent or license fees
                           which are based on a percentage of revenue shall be
                           apportioned on a calendar year or fiscal year basis
                           (depending upon which is appropriate under each
                           Lease) so that the amount thereof under any of the
                           Leases to which Seller shall be entitled shall be an
                           amount which bears the same ratio to the base rent,

                                      -14-
<PAGE>

                           additional rent and escalation rents due thereunder
                           for the current period as the number of days in said
                           period which shall have elapsed prior to the Closing
                           Date bears to the total number of days in said period
                           (E.G., if the current period for which such
                           additional and escalation rents are ---- to be paid
                           runs from January 1, 2002 through December 31, 2002,
                           Seller shall be entitled to the number of days from
                           and including January 1, 2002 to the Closing Date,
                           divided by 365 and multiplied by the total additional
                           and escalation rents due for such period);

                  (xi)     itemized supplies on hand in unopened cartons, at
                           Seller's cost plus applicable sales taxes, but in no
                           event in excess of $5,000; and

                  (xii)    all other items customarily apportioned in connection
                           with sales of similar properties similarly located.

                  (b) If the Closing Date shall occur before the real property
taxes, water rates and charges and sewer taxes and rents are finally fixed, the
apportionments thereof made at the Closing shall be upon the basis of the tax or
water rates for the preceding year applied to the latest assessed valuation, but
after the real property taxes, water rates and charges and sewer taxes and rents
are finally fixed, Seller and Purchaser shall promptly make a recalculation of
the apportionment of same, and Seller or Purchaser, as the case may be, shall
thereafter promptly make an appropriate payment to (or at the direction of) the
other based on such recalculation.

                  (c) If water meters are located on the Property, Seller shall
furnish readings to a date not more than fifteen (15) days prior to the Closing
Date, and the unfixed water rates and charges, sewer taxes and rent, if any,
based thereon for the intervening time, shall, subject to post-closing
adjustment, be apportioned on the basis of such last readings.

                  (d) Seller shall furnish a final reading of all master utility
meters (including steam, gas, oil, electricity and water and any derivative
sewer charges based on meters) to a date not more than fifteen (15) days prior
to the Closing Date. Purchaser shall execute a notice to each of such utility
companies substantially in the form of EXHIBIT Q attached hereto, advising such
utility companies of the termination of Seller's responsibility for such charges
for utilities furnished to the Property from and after the Closing Date. If a
bill is obtained from any of such utility companies before the Closing Date,
Seller shall pay such bill on or before the Closing and deliver proof of payment
thereof to Purchaser. If such bill shall not have been obtained before the
Closing, Seller shall pay all such utility, water and sewer charges which relate
solely to the period prior to the Closing Date and Purchaser shall pay all such
utility, water and sewer charges which relate solely to the period on or after
the Closing Date. Any bill which shall be rendered after the Closing and covers
a period both before and after the Closing Date shall be apportioned between
Purchaser and Seller as of the Closing Date as herein provided, but such bill
shall be paid by Purchaser. Seller shall be entitled to the return of any
deposit(s) posted with any utility company (unless credited as provided above).

                  (e) The value of any fuel oil owned by Seller and available to
the Buildings on the date as of which adjustments shall be made, shall be
adjusted at the cost price thereof to Seller, as reflected in Seller's last

                                      -15-
<PAGE>

bill, plus tax. The amount of fuel oil is to be estimated in writing by the fuel
company presently supplying fuel to the Buildings, as of the Closing Date.

                  (f) If, after the Closing Date, Seller receives any Rent not
specifically designated as being for any period prior to the Closing Date,
Seller shall forthwith remit to Purchaser the amount of such Rent less any
amounts to which Seller shall be entitled as hereinafter provided. If, after the
Closing Date, Seller receives Rent which is specifically designated as being for
any period prior to the Closing Date, Seller shall be entitled to retain
therefrom such past-due or accrued Rent with respect to the period prior to the
Closing Date for which Seller has not received a credit therefor at the Closing
and Seller shall forthwith remit to Purchaser any remaining portion of such
payments. If, after the Closing Date, Purchaser receives Rent which is not
specifically designated as being for any period subsequent to the Closing Date,
such Rent shall first be applied to such charges as are then due and then
applied in their reverse order of accrual until applied in full and Seller shall
remit to Purchaser within thirty (30) days after receipt any remaining portion
of such Rent that is due to Seller. Nothing herein contained shall preclude
Seller from asserting separate and independent non-possessory claims against any
Tenants including, but not limited to, the institution of such non-possessory
actions or proceedings as Seller shall deem necessary or advisable for the
purpose of collecting such past-due Rent not credited to Seller at the Closing,
the right (but not the obligation) to do any of which is hereby reserved by
Seller.

                  (g) Subject to the provisions of this Section 6.3, to the
extent that Rent cannot be determined on the Closing Date, or is collected after
the Closing Date for any period prior thereto, the amount of such Rent for the
period ending on the Closing Date, and all accountings showing the calculations
thereof, shall be paid and furnished to Seller by Purchaser, or to Purchaser by
Seller, as the case may be, as and when received after the Closing Date,
PROVIDED, HOWEVER, the amount of such Rent and such accountings shall not be
paid and so furnished more often than monthly and provided further that the
parties agree that a final payment and accounting shall occur no later than on
the one (1) year anniversary of the Closing Date.

                  (h) At the Closing, Purchaser shall receive a credit against
the Balance of the Purchase Price in the aggregate amount of the cash Security
Deposits and any interest required to be paid thereon, if any.

                  (i) If there are any liens or encumbrances which Seller is
obligated to pay and discharge pursuant to the terms of this Agreement, Seller
may use any remaining portion of the Balance of the Purchase Price to satisfy
the same, provided that Seller, at the Closing, delivers to Purchaser
instruments in recordable form and sufficient to satisfy of record such liens
and encumbrances, together with a check for the cost of recording or filing such
instruments, and/or directs Purchaser, at least five (5) business days prior to
the Closing, to deposit with the Lead Title Company and any co-insurer at the
Closing such amount of money as may be sufficient to induce the Lead Title
Company to omit same as an exception to title to the Property. Purchaser, if
request is made at least five (5) business days prior to the Closing, agrees to

                                      -16-
<PAGE>

provide Seller at the Closing with available funds, in an aggregate amount not
exceeding the sum of (i) the Balance of the Purchase Price (less the aggregate
amount of any credits against the Balance of the Purchase Price provided for
herein) and (ii) any other amounts due by Purchaser to Seller pursuant to this
Agreement, to facilitate the satisfaction of any of the aforesaid taxes,
assessments, water rates and charges, sewer taxes and rents, liens and
encumbrances.

                  (k) Notwithstanding anything contained herein to the contrary,
if there are any other item(s) to be apportioned in accordance with this Section
6.3 which Seller is obligated to pay pursuant to the terms of this Agreement,
Seller may use any remaining portion of the Balance of the Purchase Price to
satisfy the same, provided that Seller, at the Closing, delivers to Purchaser
official bills therefor, with interest and penalties thereon, if any.

                  (l) In the event any portion of the tenant improvement
allowance (the "AMERICAN-RE ALLOWANCE") payable to American Re-Insurance Company
("AMERICAN-RE") under the terms of the Lease Agreement by and between Seller and
American-Re, as identified on the schedule of Leases attached hereto as EXHIBIT
C and made a part hereof for all purposes, has not been fully advanced by Seller
to American-Re on or prior to Closing, then Purchaser shall be entitled to a
credit against the Purchase Price in an amount equal to the unadvanced portion
of the American-Re Allowance.

                  (m) Except as is otherwise specifically provided herein, the
customs and prevailing practice for similar transactions in the jurisdiction
where the Property is located shall apply to the apportionments and other
matters herein mentioned. The parties hereto agree that any errors or omissions
in computing apportionments at the Closing shall be corrected promptly after
their discovery. The provisions of this Section 6.3 shall survive the Closing.

         6.4. PURPOSE AND INTENT. Except as expressly provided herein, the
purpose and intent as to the provisions of this Agreement relating to
prorations, adjustments and apportionments is that Seller shall bear all
expenses of ownership and operation of the Property and shall receive all income
therefrom accruing through midnight at the end of the day preceding the Closing
and Purchaser shall bear all such expenses and receive all such income accruing
thereafter.

7.       DAMAGE, DESTRUCTION OR CONDEMNATION.

         7.1. CASUALTY. The risk of any loss or damage to the Property prior to
the Closing Date shall remain upon Seller. If, prior to the Closing, all or any
portion of the Property is destroyed or damaged as a result of fire or any other
cause whatsoever, Seller shall give written notice thereof promptly to
Purchaser. If, as a result of such damage or destruction, either (i) fifteen
percent (15%) or more of the net rentable area of the Buildings is rendered
untenantable or (ii) any portion of the Property having a material and
beneficial affect on the use of the Property (including ingress, egress and
parking spaces) is substantially damaged or destroyed, Purchaser shall have the
right to terminate this Agreement by giving written notice of its election to
Seller within fourteen (14) days after receiving notice of such destruction. If
Purchaser fails to give such written termination notice within such fourteen
(14) day period, or if prior to the Closing, less than fifteen percent (15%) of
the net rentable area of the Buildings is rendered untenantable and no portion
of the Property having a material and beneficial affect on the use of the
Property (including ingress, egress and parking spaces) is substantially damaged

                                      -17-
<PAGE>

or destroyed, this transaction shall be consummated on the date and at the
Purchase Price provided for in Section 2, and Seller will assign to Purchaser at
the Closing the physical damage proceeds of any insurance policies payable to
Seller, up to the amount of the Purchase Price, and Purchaser shall receive as a
credit against the Purchase Price the amount of any deductibles under the
policies of insurance covering such loss or damage, and except for such credit,
there shall be no reduction in the Purchase Price.

         7.2. CONDEMNATION. If between the date of this Agreement and the
Closing Date, either (i) fifteen percent (15%) or more of the net rentable area
of the Buildings or (ii) any portion of the Property having a material and
beneficial affect on the use of Property (including ingress, egress and parking
spaces) is taken by any governmental entity as a result of the exercise of the
power of eminent domain, Seller shall give written notice thereof promptly to
Purchaser, and Purchaser, at its election, may terminate this Agreement by
giving written notice of its election to Seller within fourteen (14) days after
receiving notice of such taking. If Purchaser fails to give such written
termination notice within such fourteen (14) day period, or if prior to the
Closing, less than fifteen percent (15%) of the net rentable area of the
Buildings and no portion of the Property having a material and beneficial affect
on the use of the Property (including ingress, egress and parking spaces) is
taken as aforesaid, this transaction shall be consummated on the date and at the
Purchase Price provided for in Section 2, and Seller will assign to Purchaser
Seller's portion of any condemnation award up to the amount of the Purchase
Price, less any reasonable attorney's fees, if any, and out of pocket expenses
incurred by Seller in connection with the recovery of such condemnation award.

         7.3. RESTORATION. After the Effective Date, Seller shall not settle any
insurance or condemnation claim or commence or perform any work to restore the
Property in connection with any casualty or condemnation without obtaining the
prior written consent of Purchaser as to such settlement and/or restoration.

         7.4. TERMINATION AND RETURN OF DEPOSIT. If Purchaser elects to
terminate this Agreement pursuant to this Section 7, Seller shall promptly
direct the Title Company to return the Deposit to Purchaser, and all rights and
obligations of Seller and Purchaser hereunder (except those set forth in this
Agreement which expressly survive a termination of this Agreement) shall
terminate immediately.

8.       NOTICES. Any notice required or permitted to be given hereunder shall
be deemed to be given when hand delivered or one (1) business day after pickup
by Federal Express, or similar overnight express service, or when delivered by
facsimile transmission with written acknowledgment of receipt, in any case
addressed to the parties at their respective addresses referenced below:

                                      -18-
<PAGE>

         If to Seller:                 c/o Patrinely Group, LLC
                                       1980 Post Oak Boulevard, Suite 1600
                                       Houston, Texas  77056
                                       Attention:  C. Dean Patrinely
                                       Fax:  (713) 840-2705

         With a copy to:               Patrinely Group, LLC
                                       7475 Wisconsin Avenue, Suite 1150
                                       Bethesda, Maryland  20814
                                       Attention:  William S. Glading
                                       Fax:  (301) 968-4001

         With a copy to:               Andrews & Kurth L.L.P.
                                       600 Travis, Suite 4200
                                       Houston, Texas  77002
                                       Attention:  Michael A. Boyd
                                       Fax:  (713) 238-7138

         If to Purchaser:              New Valley Corporation
                                       100 S.E. Second Street
                                       32nd Floor
                                       Miami, Florida  33131
                                       Attention:  Richard J. Lampen
                                       Fax:  (305) 579-8009

         With a copy to:               New Valley Corporation
                                       712 Fifth Avenue
                                       52nd Floor
                                       New York, New York  10019
                                       Attention:  Bennett P. Borko
                                       Fax:  (212) 409-2869

         With a copy to:               Fischbeino Badilloo Wagnero Harding
                                       909 Third Avenue, 17th Floor
                                       New York, New York  10022
                                       Attention:  Gerald N. Schrager, P.C.,
                                                   of counsel
                                       Fax:  (212) 755-3447

         If to Lead Title Company:     First American Title Insurance Company
                                       633 Third Avenue
                                       New, York  10017
                                       Attention:  Jeffrey S. Mitzner
                                       Fax:  (212) 331-1514

                                      -19-
<PAGE>

or, in each case, to such other address as either party may from time to time
designate by giving notice in writing to the other party. Telephone and
facsimile numbers are for informational purposes only. Effective notice will be
deemed given only as provided above.

9.       CLOSING MATTERS.

         9.1. SELLER'S DELIVERIES. Seller shall deliver either at the Closing or
by making available at the Property, as appropriate, the following original
documents, each duly executed and, as applicable, acknowledged:

                  (a) a special or limited warranty deed to the Property in the
form attached hereto as EXHIBIT R.

                  (b) a bill of sale in the form attached hereto as EXHIBIT S
conveying the Personal Property.

                  (c) the Leases described in Section 1.1(f) which are still in
effect as of the Closing and any new leases entered into pursuant to Section
4.4; all cash security deposits delivered by Tenants pursuant to the terms of
Leases (to be transferred as provided in Section 6.3(h)) together with any
interest payable thereon and which have not been applied in accordance with the
terms of the Leases; the letter of credit in the initial amount of $1,298,572.60
(the "PHYSIOME LC"), issued by Citibank North America, Inc. in connection with
the Lease with Physiome Sciences, Inc. (the "PHYSIOME LEASE"), which has not
been applied in accordance with the terms of the Leases; PROVIDED, HOWEVER, that
Seller shall be responsible for any fees or other costs associated with the
transfer of the Physiome LC; any advance rentals previously delivered by any
Tenants; and an assignment of the Leases, deposits, and prepaid rents by way of
an assignment and assumption in the form attached hereto as EXHIBIT T. Seller
shall take all necessary action to transfer the Physiome LC to Purchaser as of
the Closing Date; provided, however, if the transfer of the Physiome LC to
Purchaser has not been completed by the Closing Date, then Seller shall escrow
funds with the Title Company pursuant to an escrow agreement reasonably
acceptable to Seller, Purchaser and the Title Company (the "PHYSIOME LC
ESCROW"), which funds shall be in an amount equal to the then outstanding
balance that may be drawn under the Physiome LC. Upon completion of the transfer
of the Physiome LC to Purchaser, all funds held in the Physiome LC Escrow shall
be immediately released to Seller. Seller shall, until the transfer
documentation is duly issued (which issuance Purchaser and Seller agree to
pursue diligently after the Closing) and delivered in favor of Purchaser or
Purchaser's lender, as identified to Seller by December 6, 2002, take all
reasonable action and use its reasonable and diligent efforts to cause Fleet
Bank to take all reasonable action, as and if directed by Purchaser and without
obligation to incur any expense which is not reimbursed or advanced by
Purchaser, in connection with the presentment of such letters of credit for
payment as permitted under the terms of the Physiome Lease, and in consideration
of Seller's agreement as aforesaid, Purchaser shall indemnify and hold Seller
harmless from any loss, claim, damage, liability or expense, including without
limitation reasonable attorneys' fees, court costs and disbursements, arising
out of or resulting from Seller's actions relating to such letter of credit
after the Closing Date. The obligations set forth in this provision shall
survive the Closing.

                                      -20-
<PAGE>

                  (d) estoppel certificates ("ESTOPPEL CERTIFICATES") dated not
earlier than thirty (30) days prior to the Closing and substantially in the form
attached hereto as EXHIBIT U, without material alterations thereto, executed by
the following tenants (the "REQUIRED TENANTS"): (A) Novo Nordisk
Pharmaceuticals, Inc., ZS Associates, Inc., Physiome Sciences, Inc., American
Re-Insurance Company and Patrinely Group, LLC (each an "ANCHOR TENANT", and
collectively, the "ANCHOR TENANTS") and (B) either Duane, Morris & Heckscher, LP
or Broadbeam Corporation. It shall be a condition precedent to Purchaser's
obligation to close that Seller provide the Estoppel Certificates as required
under this section not later than the Closing Date; PROVIDED, HOWEVER,
notwithstanding anything to the contrary contained in this Agreement (y) in the
event Seller shall be unable to obtain an Estoppel Certificate from any Tenant,
Purchaser may, at its option and in lieu of the Estoppel Certificate from any
Tenant, require Seller to deliver to Purchaser at the Closing a certificate (a
"SELLER'S CERTIFICATE") executed by Seller, certifying that the information set
forth in the Estoppel Certificate prepared for such Tenant is true and correct
in all material respects and (z) Seller's failure to provide any such Estoppel
Certificate from the Required Tenants shall not be deemed a default hereunder
and Purchaser's sole remedy shall be to terminate this Agreement upon written
notice to Seller, in which event the Deposit shall be refunded to Purchaser and
this Agreement shall be of no further force and effect (except for any
provisions contained herein which survive expressly by their terms). Seller
shall be released from any liability to Purchaser with respect to any Seller's
Certificate delivered by Seller, upon the delivery to Purchaser of a properly
completed Estoppel Certificate from the applicable Tenant for whom Seller has
delivered such Seller's Certificate. Notwithstanding anything in this Agreement
to the contrary, in the event that any Estoppel Certificate required to be
delivered under this Agreement contains a material and adverse change from the
form provided to the Tenant or discloses a material default by Seller under such
Lease or a previously undisclosed material obligation of Seller (and Seller is
unable, prior to the Closing Date, to get such estoppel certificate reissued
without such change or disclosure), Purchaser, as its sole remedy, may terminate
this Agreement by written notice to Seller, in which event the Deposit shall be
refunded to Purchaser and this Agreement shall be of no further force and effect
(except for any provisions of this Agreement that are expressly stated to
survive any termination of this Agreement).

                  (e) copies of all contracts relating to the Property which
Purchaser has elected to assume or which are not terminable by Seller on or
before the Closing Date; an assignment of such contracts to Purchaser, in the
form attached hereto as EXHIBIT V; and notices to the contractors under such
contracts, with respect to the assumption by Purchaser of all obligations
thereunder, which notices Purchaser shall be obligated to deliver to the
contractors.

                  (f) an assignment of all transferable warranties and
guarantees then in effect, if any, with respect to the improvements located on
the Property or any repairs or renovations to such improvements and Personal
Property being conveyed hereunder, which assignment shall be in the form
attached hereto as EXHIBIT W.

                  (g) an assignment and assumption of certain brokerage and
listing agreements relating to the Leases and/or the Buildings which assignment
and assumption agreement shall be in the form attached hereto as EXHIBIT X.

                                      -21-
<PAGE>

                  (h) current unpaid real estate tax, water and sewer bills.

                  (i) the books and records for the two (2) calendar years prior
to the year in which the Closing occurs, and all books and records for the
calendar year in which the Closing occurs, maintained at the Property or held by
or for the account of Seller, together with all plans and specifications
relating to the Property and lease applications, as available.

                  (j) an affidavit pursuant to the Foreign Investment and Real
Property Tax Act in the form attached hereto as EXHIBIT Y.

                  (k) a certificate of the member of Seller certifying the due
authorization of the transaction contemplated by this Agreement, as well as any
other evidence of authority and good standing as the Lead Title Company or any
co-insurer shall reasonably require in order to issue the Title Policy
hereunder.

                  (l) to the extent in possession, custody or control of Seller,
all Intangible Personal Property, together with an assignment and assumption
thereof substantially in the form of EXHIBIT Z attached hereto.

                  (m) notices to Tenants, including new notice addresses for the
landlord and payment instructions, which notices Purchaser shall prepare and
cause to be delivered to the Tenants, at Purchaser's sole cost and expense, as
required by their respective Leases.

                  (n) notices to the utility companies, as provided in Section
6.3(d).

                  (o) a designation agreement (the "DESIGNATION AGREEMENT") in
the form attached hereto as EXHIBIT AA.

                  (p) a property management agreement (the "PROPERTY MANAGEMENT
AGREEMENT"), whereby Purchaser engages Crimson Corporate Services, LLC to manage
the Property. The Property Management Agreement shall be in a form reasonably
acceptable to both Seller and Purchaser. The Property Management Agreement shall
provide for (i) a three percent (3%) management fee, and (ii) an obligation for
Property Manager to carry a fidelity bond and O&E insurance in the amount of
$1,000,000.

                  (q) transfer, stamp or documentary tax returns, as may be
customary in the jurisdictions having authority over this transaction or
otherwise required hereunder.

                  (r) all keys and/or access cards in Seller's possession to all
entrance doors to, and any equipment and utility rooms located in, the
Buildings.

                  (s) deliver to Purchaser a certificate executed by Seller
updating the representations and warranties of Seller in Section 5.1; provided
that, in the event that any representation or warranty of Seller set forth in
Section 5.1 hereof needs to be modified due to changes since the Effective Date,
such certificate shall state that such representation or warranty is not, or no
longer is, true and correct and shall explain the state of facts giving rise to
the change. In no event shall Seller be liable to Purchaser for, or be deemed to
be in default hereunder by reason of, any breach of representation or warranty
set forth in Section 5.1 which results from any change that both (i) occurs

                                      -22-
<PAGE>

between the Effective Date and the Closing Date and (ii) is expressly permitted
under the terms of this Agreement or is beyond the reasonable control of Seller
to prevent; provided, however, that the occurrence of a change which is
permitted hereunder or is beyond the reasonable control of Seller to prevent
shall, if materially adverse to Purchaser, constitute the non-fulfillment of the
condition set forth in Section 5.5(b) hereof; if, despite such changes or other
matters described in such certificate, the Closing occurs, Seller's
representations and warranties set forth in this Agreement shall be deemed to
have been modified by all statements made in such certificate.

                  (t) a closing statement setting forth all credits, adjustments
and prorations made in accordance with the terms of this Agreement in form and
content reasonably satisfactory to Purchaser and Seller (the "CLOSING
STATEMENT").

                  (u) a letter addressed to and agreed to in writing by the Lead
Title Company (the "ESCROW DISBURSEMENT LETTER") directing the Lead Title
Company to hold in escrow and, upon satisfaction of the conditions set forth
therein, to date and otherwise complete (where applicable) and deliver out of
escrow, the Deed and other closing documents and to disburse the Deposits, the
Balance of the Purchase Price (after credits, adjustments and prorations in
accordance with Closing Statement), as well as any other payments as provided
for in this Agreement.

                  (v) a letter in standard form from the New Jersey Department
of Environmental Protection stating that the provisions of the Industrial Site
Recovery Act ("ISRA") are not applicable to the Property, or evidence reasonably
satisfactory to Purchaser of compliance with the provisions of ISRA.

                  (w) a rent roll for the Property (certified to Seller's
knowledge) dated not earlier than seven (7) days before the Closing Date (in the
same form as the Rent Roll attached as EXHIBIT L).

                  (x) evidence of the termination of the Equipment Lease dated
June 28, 2002, by and between Seller, as lessee, and DLM Leasing, LLC, as
lessee, together with evidence of the due exercise and consummation of the
"Purchase Option (as defined therein).

                  (y) other documents and affidavits (including a "gap indemnity
and hold harmless agreement" to the Title Company) as may reasonably be
requested by Purchaser or Title Company for a transaction of this type.

                  (aa) a guaranty by Apollo Real Estate Investment Fund III,
L.P. ("Apollo") and Crimson Capital, Ltd. ("Crimson"), in the form attached
hereto as EXHIBIT BB, whereby such parties guaranty (i) payment of any
post-closing reconciliations of income and operating expenses of the Property
pursuant to Section 6.3 hereof and (ii) any post-closing obligations of Seller

                                      -23-
<PAGE>

with respect to the representations and warranties of Seller contained in
Section 5.1 and Section 5.3; provided, however, that the aggregate liability of
Apollo and Crimson under such guaranty for all post-Closing obligations shall be
limited to Two Million Two Hundred Fifty Thousand and No/100 Dollars
($2,250,000.00).

                  (bb) a guaranty by Apollo, in the form attached hereto as
EXHIBIT CC, whereby Apollo guarantees Seller's representations and warranties
contained in Section 5.1(f) and Section 5.1(g).

         9.2. PURCHASER'S DELIVERIES. At the Closing, Purchaser shall deliver
the following original documents, each duly executed and, as applicable,
acknowledged:

                  (a) the Designation Agreement, the Property Management
Agreement, all assignments and assumptions of any Leases, contracts, Personal
Property, Intangible Personal Property, security deposits, brokerage and listing
obligations and other assets and intangibles assigned to Purchaser hereunder.

                  (b) copies of any notices to Tenants, utility companies and
contractors required pursuant to this Agreement.

                  (c) transfer, stamp or documentary tax returns as may be
customary in the jurisdictions having authority over this transaction or
otherwise required hereunder.

                  (d) The Closing Statement.

                  (e) The Escrow Disbursement Letter.

                  (f) such other documents as may reasonably be requested by
Seller or Title Company for a transaction of this type.

         9.3. POSSESSION. Purchaser shall be entitled to possession of the
Property upon conclusion of the Closing.

         9.4. INSURANCE. Seller shall terminate its policies of insurance as of
noon on the Closing Date and Purchaser shall be responsible for obtaining its
own insurance thereafter.

         9.5. NOTICE LETTERS. Subsequent to and/or at the Closing, to the extent
requested by Purchaser, Seller shall execute and deliver to Purchaser copies of
form letters (prepared by Purchaser and reasonably approved by Seller) to
contractors, any taxing authorities and any other parties serving the Property
and not separately notified, advising them of the sale of the Property to
Purchaser and directing to Purchaser all bills for the services provided to the
Property on and after the Closing Date.

         9.6. LETTERS OF CREDIT. Seller has posted two (2) separate letters of
credit with Plainsboro Township, New Jersey. The first letter of credit is
Standby Letter of Credit No. RS 1339554 dated July 15, 2002 in the amount of
$32,710.05 (the "MAINTENANCE LC"), which was posted in connection with a
requisite two (2) year maintenance guaranty with regard to certain off-site
improvements related to the Property and the roadways adjacent to the Property.

                                      -24-
<PAGE>

The second letter of credit is Standby Letter of Credit No. 1339556 dated July
15, 2002 in the amount of $712,735.28 (the "SITE LC"), which was posted in
connection with the obligations associated with, inter alia, certain unfinished
landscaping on the Property. The parties anticipate that, prior to Closing, the
Township of Plainsboro will authorize a two-year maintenance guarantee in the
form of a bond or letter of credit in the amount of $395,964.05 (the
"REPLACEMENT LC") in lieu of the Site LC. At Closing, Purchaser shall substitute
its own letter of credit or bond for the Maintenance LC; PROVIDED, HOWEVER, if
Purchaser has not then substituted its own bond or letter of credit for the
Maintenance LC, then Purchaser shall escrow $32,710.05 with the Title Company
pursuant to an escrow agreement reasonably acceptable to Seller, Purchaser and
the Title Company (the "MAINTENANCE LC ESCROW"). Upon Purchaser's substitution
of its own bond or letter of credit for the Maintenance LC, and the return to
Seller of the Maintenance LC, all funds held in the Maintenance LC Escrow shall
be immediately released to Purchaser. If, prior to Closing, the Township of
Plainsboro has not authorized the replacement of the Site LC solely upon tender
of the Replacement LC, then Seller shall maintain the Site LC in place until
such time as the Township of Plainsboro so authorizes such replacement. If,
prior to Closing, the Township of Plainsboro has authorized the replacement of
the Site LC solely upon the tender of the Replacement LC, then, at Closing,
Purchaser shall provide its own letter of credit or bond for the Replacement LC.
If, at Closing, Purchaser has not substituted its own Replacement LC for the
Site LC, then Purchaser shall escrow $395,964.05 with the Title Company pursuant
to an escrow agreement reasonably acceptable to Seller, Purchaser and the Title
Company (the "REPLACEMENT LC ESCROW"). Upon Purchaser's substitution of its own
Replacement LC for the Site LC, and the return to Seller of the Site LC, all
funds held in the Replacement LC Escrow shall be immediately released to
Purchaser. Purchaser and Seller shall cooperate and assist each other, in all
reasonable respects, in promptly obtaining a release of the Maintenance LC and
the Site LC or Replacement LC, as applicable, that have previously been posted
with Plainsboro Township, New Jersey by Seller. Seller shall be solely
responsible for completion of all conditions required by Plainsboro Township
(other than Purchaser's tender of the Replacement LC) in order to allow the Site
LC to be returned to Seller. After Closing, Purchaser shall be solely
responsible for all obligations associated with the requirements imposed by
Plainsboro Township, New Jersey related to the site improvement and landscaping
maintenance obligations guaranteed by the Maintenance LC and the Replacement LC.
The provisions of this Section 9.6 shall survive the Closing.

10.      DEFAULT; DEFECTS.

         10.1. PURCHASER DEFAULT. If Purchaser shall refuse or fail to purchase
the Property as herein provided for any reason other than (i) a default by
Seller, or (ii) any other provision of this Agreement which permits Purchaser to
terminate this Agreement or otherwise relieves Purchaser of the obligation to
acquire the Property, the Deposit shall be retained by Seller as liquidated
damages as and for its sole and exclusive remedy, and both parties shall be
relieved of and released from any further liability hereunder except for any
obligation which is expressly provided in this Agreement to survive any

                                      -25-
<PAGE>

termination of this Agreement. Seller and Purchaser agree that the Deposit is a
fair and reasonable amount to be retained by Sellers as agreed upon liquidated
damages in light of Seller's removal of the Property from the market and the
costs incurred by Seller and shall not constitute a penalty or a forfeiture.

         10.2. SELLER DEFAULT. If Seller shall refuse or fail to convey the
Property as herein provided for any reason other than (i) a material default by
Purchaser, or (ii) any other provision of this Agreement which permits Seller to
terminate this Agreement or otherwise relieves Seller of the obligation to
convey the Property, Purchaser shall elect as its sole and exclusive remedy
hereunder either to terminate the Agreement and recover the Deposit or to seek
specific performance of Seller's obligations to convey the Property, provided
that no such action in specific performance shall seek to require the Seller to:
(a) change the condition of the Property or restore the same after any fire or
other casualty; (b) subject to Section 10.3 below, expend money or post a bond
to remove a title encumbrance or defect or correct any matter shown on the
Surveys; or (c) secure any permit, approval, or consent with respect to the
Property or Seller's conveyance of the Property. Failure to file suit for
specific performance within ninety (90) days after the scheduled Closing Date
shall be deemed Purchaser's election to waive any right to sue for specific
performance.

         10.3. DEFECTS. If, prior to the Closing, Seller discloses to Purchaser
or Purchaser discovers that any representation or warranty of Seller contained
in this Agreement is or, as of the Closing Date, will be untrue, then Purchaser
shall promptly give Seller written notice of its objection thereto. The parties
acknowledge and agree that Seller shall have no obligation to cure any such
objections of Purchaser. If Purchaser fails to waive the objection within two
(2) business days after notice from Seller that Seller is unable or unwilling to
cure such objections by Purchaser, then this Agreement will terminate
automatically and Seller shall promptly direct the Lead Title Company to return
the Deposit to Purchaser, provided that Purchaser shall not be in material
default hereunder, and neither party shall have any liability to the other
except for Purchaser's indemnity obligations set forth in this Agreement and the
Confidentiality and Inspection Agreement.

         10.4 Notwithstanding anything in this Agreement to the contrary,
Purchaser acknowledges that any inconsistency between (i) any representation or
warranty by Seller in this Agreement or any certificate delivered at the Closing
in connection therewith and (ii) the Evaluation Materials available for review
by Purchaser or its representatives prior to the Closing, shall be controlled by
the terms of such Evaluation Materials and that any inconsistency shall not
constitute an objection to title or a breach by Seller of any representation or
warranty made by Seller in this Agreement.

         10.5 Notwithstanding anything in this Agreement to the contrary,
Purchaser may provide written notice (each a "TITLE NOTICE") to Seller on or
before the Closing Date of any matters shown by updates (whether by current
title searches, visual inspections or otherwise) of the Title Commitment and/or
the Surveys (collectively, the "REVIEW MATERIALS") which materially deviate from
the matters disclosed by the Review Materials and which are not otherwise a
Permitted Encumbrance under this Agreement (each an "OBJECTION", and
collectively, "OBJECTIONS") and which specify the reason such Objections are not
satisfactory and the curative steps necessary to remove the Objections by the
Closing Date; provided, however, the Title Notice must be delivered by Purchaser
to Seller within five (5) Business Days after Purchaser becomes aware of such
Objections. Prior to Closing, Seller shall use its good faith, diligent efforts

                                      -26-
<PAGE>

to cure any Objections that (i) would prevent the current use and operation of
the Property, (ii) would represent a claim of fee ownership of the Property, or
(iii) is a monetary lien (other than the Seller Mortgages) against the Property
created by Seller; provided, however, Seller shall not be obligated to expend
more than Fifty Thousand and No/100 Dollars ($50,000.00) in the aggregate to
cure all of such Objections that meet the requirements set forth in items (i),
(ii) or (iii) above. Seller agrees, without the need for notice from Purchaser,
that the Seller Mortgages will be satisfied by Seller on or prior to the Closing
Date or, if not so satisfied, shall be satisfied at Closing out of the Balance
of the Purchase Price otherwise payable to Seller. As used herein, the "SELLER
MORTGAGES" shall mean the financing documents described in the Title Commitment
and any other liens voluntarily created by Seller. Except as otherwise set forth
in this Section 10.5, the parties acknowledge and agree that Seller shall have
no other obligation to cure any Objections. In the event that Seller does not
cure the Objections, Purchaser shall have the option, by written notice to
Seller, to either (a) terminate this Agreement and recover the Deposit or (b)
waive its disapproval of such Objections without any reduction to the Purchase
Price; provided, however, if such Objections meet the requirements set forth in
items (i), (ii) or (iii) above, then Purchaser shall be entitled to a reduction
in the Purchase Price equal to Fifty Thousand and No/100 Dollars ($50,000.00)
less any amounts actually expended by Seller in attempting to cure the
Objections. For the purposes of this Agreement, any Objection shall be deemed
cured if Lead Title Company and any co-insurer or another title company
reasonably acceptable to Purchaser and authorized to do business in the
jurisdiction where the Property is located will agree to issue an ALTA owner's
title insurance policy to Purchaser for the Purchase Price, which policy takes
no exception for such Objection and is issued for no additional premium or for
an additional premium if Seller agrees to pay such additional premium.

11.      MISCELLANEOUS.

         11.1. ENTIRE AGREEMENT. This Agreement, together with (i) the Exhibits
attached hereto, all of which are incorporated by reference and (ii) the
Confidentiality and Inspection Agreement are the entire agreement between the
parties with respect to the subject matter thereof, and no alteration,
modification or interpretation hereof shall be binding unless in writing and
signed by the parties thereto.

         11.2. SEVERABILITY. If any provision of this Agreement or application
to any party or circumstances shall be determined by any court of competent
jurisdiction to be invalid and unenforceable to any extent, the remainder of
this Agreement or the application of such provision to such person or
circumstances, other than those as to which it is so determined invalid or
unenforceable, shall not be affected thereby, and each provision hereof shall be
valid and shall be enforced to the fullest extent permitted by law.

         11.3. APPLICABLE LAW. This Agreement shall be construed and enforced in
accordance with the laws of the State of New Jersey.

                                      -27-
<PAGE>

         11.4. ASSIGNABILITY. Purchaser may not assign this Agreement without
first obtaining Seller's written consent, which Seller shall grant or withhold
in its sole discretion. Any assignment in contravention of this provision shall
be void. No assignment, whether or not permitted, shall release the Purchaser
herein named from any obligation or liability under this Agreement. The
Purchaser herein named and any permitted assignee shall be jointly and severally
liable for all such obligations and liabilities. Any permitted assignee shall be
deemed to have made any and all representations and warranties made by Purchaser
hereunder, as if the assignee were the original signatory hereto. If Purchaser
requests Seller's written consent to any assignment, Purchaser shall (i) notify
Seller in writing of the proposed assignment; (ii) provide Seller with the name
and address of the proposed assignee; (iii) provide Seller with financial
information including financial statements of the proposed assignee; and (iv)
provide Seller with a copy of the proposed assignment instrument.
Notwithstanding the foregoing, Purchaser may assign this Agreement without the
consent of Seller to a partnership of which Purchaser is the managing or sole
general partner, or to any entity directly or indirectly controlled by, under
common control with, or controlling Purchaser, provided (x) Purchaser gives
Seller written notice of such assignment, (y) such assignment does not delay the
Closing, and (z) such assignment shall not release the Purchaser named herein
from its liabilities and obligations hereunder. For the purposes of the
preceding sentence, the term "CONTROL" shall mean and refer to the power to
direct the management and policies of such entity, directly or indirectly,
whether through the ownership of voting securities or other beneficial interest,
by contract or otherwise, provided that the ownership of fifty percent (50%) or
more of the equity interest of such entity shall be deemed to constitute
"control" hereunder; and the terms "CONTROLLING" and "CONTROLLED" shall have the
meanings correlative to the foregoing.

         11.5. SUCCESSORS BOUND. This Agreement shall be binding upon and inure
to the benefit of Purchaser and Seller and their respective successors and (and,
in the case of Purchaser, permitted) assigns.

         11.6. INTENTIONALLY DELETED.

         11.7. WAIVER. The failure of either party to insist in any one or more
instance upon the strict performance of any one or more of the obligations under
this Agreement, or to exercise any election herein contained, shall not be
construed as a waiver or relinquishment for the future of the performance of
such one or more obligations of this Agreement or of the right to exercise such
election, but the same shall continue and remain in full force and effect with
respect to any subsequent breach or omission.

         11.8. NO PUBLIC DISCLOSURE. Purchaser shall make no public disclosure
of the terms of this transaction without the prior written consent of Seller,
and shall remain bound by the terms of the Confidentiality and Inspection
Agreement. Notwithstanding anything else contained in this Agreement and/or the
Confidentiality and Inspection Agreement, Purchaser may issue a press release or
public disclosure; provided, however, the information contained in such press
release and/or public disclosure relating to this transaction shall be limited

                                      -28-
<PAGE>

to the following: (a) an identification of Seller and Purchaser, (b) a
description of the identity, address, location and square footage contained
within the Buildings, (c) the Purchase Price, and (d) a description of
Purchaser's proposed acquisition financing, including, the right to file this
Agreement as a part of any such press release or public disclosure. This
provision shall not survive the Closing of the transaction contemplated
hereunder.

         11.9. CAPTIONS. The captions in this Agreement are inserted only as a
matter of convenience and for reference and in no way define, limit or describe
the scope of this Agreement or the scope or content of any of its provisions.

         11.10. ATTORNEYS' FEES. In the event of any litigation arising out of
this Agreement, the prevailing party shall be entitled to recover its reasonable
attorneys' fees, disbursements and court costs from the other party.

         11.11. NO PARTNERSHIP. Nothing contained in this Agreement shall be
construed to create a partnership or joint venture between the parties or their
successors in interest.

         11.12. TIME OF ESSENCE. Time is of the essence for all purposes of this
Agreement.

         11.13. COUNTERPARTS. This Agreement may be executed and delivered in
any number of counterparts, each of which so executed and delivered shall be
deemed to be an original and all of which shall constitute one and the same
instrument.

         11.14. RECORDATION. Except for any lis pendens filed by Purchaser in
order to enforce the specific performance of Seller's obligations under this
Contract, Purchaser and Seller agree not to record this Agreement or any
memorandum hereof. To the extent that such filing is made in violation of this
Agreement, Purchaser shall indemnify Seller against any damages incurred by
Seller in connection therewith. The provisions of this Section 11.14 shall
survive the termination of this Agreement.

         11.15. PROPER EXECUTION. The submission by Seller to Purchaser of this
Agreement in unsigned form shall be deemed to be a submission solely for
Purchaser's consideration and not for acceptance and execution. Such submission
shall have no binding force and effect, shall not constitute an offer, and shall
not confer any rights upon Purchaser or impose any obligations upon Seller
irrespective of any reliance thereon, change of position or partial performance.
The submission by Purchaser to Seller of this Agreement in unsigned form shall
be deemed to be a submission solely for Seller's consideration and not for
acceptance and execution. Such submission shall have no binding force and
effect, shall not constitute an offer, and shall not confer any rights upon
Seller or impose any obligations upon Purchaser irrespective of any reliance
thereon, change of position or partial performance. The submission by Seller of
this Agreement for execution by Purchaser and the actual execution and delivery
thereof by Purchaser to Seller shall similarly have no binding force and effect
on Seller unless and until Seller shall have executed this Agreement and the
Deposit shall have been received by the Title Company and a counterpart thereof
shall have been delivered to Purchaser. The submission by Purchaser of this
Agreement for execution by Seller and the actual execution and delivery thereof

                                      -29-
<PAGE>

by Seller to Purchaser shall similarly have no binding force and effect on
Purchaser unless and until Purchaser shall have executed this Agreement and the
Deposit shall have been received by the Title Company and a counterpart thereof
shall have been delivered to Seller. The use of telecopied signatures in place
of original signatures on this Agreement is expressly allowed. Seller and
Purchaser intend to be bound by the signatures on the telecopied document, are
aware that the other parties will rely on the telecopied signatures, and hereby
waive any defenses to the enforcement of the terms of this Agreement based on
the form of signature.

         11.16. ACTUAL KNOWLEDGE; RECEIVED WRITTEN NOTICE. (a) Whenever a
representation, warranty or other statement is made in this Agreement or in any
document or instrument to be delivered at the Closing pursuant to this
Agreement, on the basis of the knowledge of Seller, or is qualified by Seller
having received written notice, such representation, warranty or other statement
is made with the exclusion of any facts disclosed in writing to or otherwise
actually known by Purchaser, and is made solely on the basis of the actual, as
distinguished from implied, imputed and constructive, knowledge on the date that
such representation or warranty is made, without inquiry or investigation or
duty thereof, of C. Dean Patrinely, Leonard J. O'Donnell, William S. Glading and
Philip Benjamin, without attribution to such specific officers of facts and
matters otherwise within the personal knowledge of any other officers or
employees of Seller or third parties, including but not limited to tenants and
property managers of the Property, and excluding, whether or not actually known
by such specific officers, any matter actually known to Purchaser or its agents
at the time of the Closing.

                  (b) Whenever a representation, warranty or other statement is
made in this Agreement or in any document or instrument to be delivered at the
Closing pursuant to this Agreement, on the basis of the actual of knowledge of
Purchaser, or is qualified by Purchaser having received written notice, such
representation, warranty or other statement is made with the exclusion of any
facts disclosed in writing to or otherwise actually known by Seller, and is made
solely on the basis of the actual, as distinguished from implied, imputed and
constructive, knowledge on the date that such representation or warranty is
made, without inquiry or investigation or duty thereof, of Bennett P. Borko,
without attribution to such specific officers of facts and matters otherwise
within the personal knowledge of any other officers or employees of Purchaser or
third parties, and excluding, whether or not actually known by such specific
officers, any matter actually known to Seller or its agents at the time of the
Closing.

         11.17. INTENTIONALLY DELETED.

         11.18. SURVIVAL AND LIMITATION. Except and to the extent specifically
set forth in this Agreement, no representation, warranty, covenant or other
obligation under this Agreement shall survive the Closing or sooner termination
of this Agreement. Notwithstanding the above, the representations and warranties
of Seller set forth in Sections 5.1 and 5.3 shall survive the Closing, but
written notification of any claim arising therefrom must be received by Seller
within six (6) months after the Closing Date and an action shall have been
commenced by Purchaser against Seller within one (1) year following Closing or
such claim shall be forever barred and Seller shall have no liability with
respect thereto. No claim for a breach of any representation or warranty of
Seller set forth in this Agreement shall be actionable or payable if the breach
in question results from or is based on a condition or state of facts actually
known to Purchaser prior to Closing. The aggregate liability of Seller with

                                      -30-
<PAGE>

respect to all claims relating to Sections 5.1 and 5.3 hereof (other than
Seller's obligation to pay Crimson and C&W as required under Section 5.3) shall
not exceed Two Million Two Hundred Fifty Thousand and No/100 DOLLARS
($2,250,000.00).

         11.19. LIMITED LIABILITY OF SELLER. The liability of Seller for damages
or otherwise shall be limited to Seller's equity interest in the Property and
the net proceeds from the sale thereof (net of all expenses of Seller in
connection with such sale). Seller shall have no personal liability beyond
Seller's equity interest in the Property and the net proceeds from the sale
thereof (net of all expenses of Seller in connection with such sale), and no
other property or assets of Seller shall be subject to levy, execution or other
enforcement procedure for the satisfaction of Purchaser's claims or any
judgments or others against Seller. Notwithstanding anything to the contrary
contained in this Agreement, Seller's shareholders, partners, directors,
members, agents, attorneys and employees shall not have any liability whatsoever
under this Agreement.

         11.20. INTENTIONALLY DELETED.

         11.21. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY
WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF
OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

         11.22. FURTHER ASSURANCES. Each party agrees that it will execute and
deliver such other documents and take such other action, whether prior or
subsequent to Closing, as may be reasonably requested by the other party or by
Purchaser's lender to consummate the transaction contemplated by this Agreement,
so long as the execution of such other documents or any such other action does
not increase or decrease the liability of either party under the terms of this
Agreement. The provisions of this Section 11.22 shall survive Closing.

         11.23. CALCULATION OF TIME PERIODS. Unless otherwise specified, in
computing any period of time described herein, the day of the act or event after
which the designated period of time begins to run is not to be included and the
last day of the period so computed is to be included, unless such last day is a
Saturday, Sunday or legal holiday for national banks in the location where the
Property is located, in which event the period shall run until the end of the
next day which is neither a Saturday, Sunday or legal holiday. The last day of
any period of time described herein and the time during any day by which an
event must occur shall be deemed to end at 5:00 p.m., according to the time at
the location of the Property.

         11.24. INCONSISTENCIES WITH CONFIDENTIALITY AND INSPECTION AGREEMENT.
The terms of this Agreement shall control over any conflicts or inconsistencies
between the terms of this Agreement and the terms of the Confidentiality and
Inspection Agreement.

12.      ESCROW PROVISIONS. The Deposit shall be held in escrow by Lead Title
Company upon the following terms:

                  (a) The Deposit shall be deposited in a special
interest-bearing commercial bank reasonably acceptable to both Purchaser and
Seller or, at the request of Purchaser, may be invested by Lead Title Company in
such interest-bearing notes, bonds, bills or other obligations as may from time
to time be requested in writing by Purchaser, provided only that such notes,

                                      -31-
<PAGE>

bonds, bills or other obligations are regularly traded on a recognized public
securities market. All interest earned on the Deposit shall be the property of
the party ultimately receiving payment of the Deposit and shall be paid to such
party at the earlier to occur of (i) the Closing or (ii) the date upon which the
Deposit is paid to Seller or Purchaser, as the case may be, in accordance with
the terms of this Agreement.

                  (b) Lead Title Company shall deliver the Deposit (including
interest earned thereon) to Seller or Purchaser, as the case may be, on the
following conditions:

                  (i)      to Seller, upon receipt of a notice signed by the
                           parties hereto stating that the Closing has been
                           consummated;

                  (ii)     to Seller, upon receipt of demand therefor signed by
                           Seller stating that Purchaser has defaulted in the
                           performance of its obligations under this Agreement;
                           PROVIDED, however, that Lead Title Company shall not
                           honor such demand until at least fifteen (15) days
                           after the date on which Lead Title Company shall have
                           sent to Purchaser a copy of such demand, nor
                           thereafter following such 15-day period if Lead Title
                           Company shall have received a notice of objection,
                           within such 15-day period, from Purchaser given in
                           accordance with the provisions of Sections 12(c) and
                           (d) hereof;

                  (iii)    to Purchaser, upon receipt of demand therefor signed
                           by Purchaser stating that either Seller has defaulted
                           in the performance of its obligations under this
                           Agreement or that Purchaser is otherwise entitled to
                           the refund of the Deposit pursuant to the terms of
                           this Agreement; PROVIDED, HOWEVER, that Lead Title
                           Company shall not honor such demand until at least
                           fifteen (15) days after the date on which Lead Title
                           Company shall have sent to Seller a copy of such
                           demand, nor thereafter following such 15-day period
                           if Lead Title Company shall have received a notice of
                           objection, within such 15-day period, from Seller
                           given in accordance with the provisions of Sections
                           12(c) and (d) hereof.

                  (c) Any notice to or demand upon Lead Title Company shall be
in writing and shall be sufficient only if received by Lead Title Company within
the applicable time periods set forth herein, if any. Notices to or demands upon
Lead Title Company shall be (1) sent by overnight courier (with receipt
requested), to Lead Title Company at the address set forth in Section 8 hereof
or at such other address as Lead Title Company shall have last designated by
notice to Seller and Purchaser, or (2) served personally upon Lead Title Company
with receipt acknowledged in writing by Lead Title Company. Notices from Lead
Title Company to Seller or Purchaser shall be (1) sent by overnight courier
(with receipt requested) to their respective addresses set forth in Section 8
hereof or at such other address as the party in question shall have last
designated by notice to Lead Title Company, or (2) served personally with
receipt acknowledged in writing by the addressee.

                                      -32-
<PAGE>

                  (d) Upon receipt of a demand for the Deposit made by Seller or
Purchaser pursuant to Section 12(b)(ii) or (iii), Lead Title Company shall
promptly send a copy thereof to the other party hereto. Such other party shall
have the right to object to the delivery of the Deposit by sending to Lead Title
Company notice of objection within fifteen (15) days after the date on which
Lead Title Company shall have sent such copy to such party, but not thereafter.
Upon receipt of such notice of objection, Lead Title Company shall promptly send
a copy thereof to the party who made the written demand.

                  (e) If (i) Lead Title Company shall have received a notice of
objection as provided for in Section 12(d) hereof within the time therefor
prescribed or (ii) any other disagreement or dispute shall arise between the
parties hereto or any other persons resulting in adverse claims and demands
being made for the Deposit, whether or not litigation has been instituted, then
and in any such event Lead Title Company shall refuse to comply with any claims
or demands on it, and shall continue to hold the Deposit until Lead Title
Company receives either (x) a written notice signed by both parties hereto
directing the disbursement of the Deposit or (y) a final order of a court of
competent jurisdiction, entered in an action, suit or proceeding to which Seller
and Purchaser are parties, directing the disbursement of the Deposit, in either
of which events Lead Title Company shall then disburse the Deposit in accordance
with such direction. Lead Title Company shall not be or become liable in any way
or to any person for its refusal to comply with any such claims and demands
unless and until it has received such direction. Upon compliance with such
direction, Lead Title Company is hereby absolved of and released from any and
all liability hereunder.

                  (f) Notwithstanding the foregoing, Lead Title Company may at
any time, on notice to the parties, deposit the Deposit (together with any
interest earned or accrued thereon) with a court of competent jurisdiction and,
if desired by Lead Title Company, commence an impleader action against any party
hereto not theretofore before such court or an interpleader action against both
parties hereto. Upon the taking by Lead Title Company of any action described in
this Section 12(f), Lead Title Company is hereby absolved of and released from
any and all liability hereunder.

                  (g) Except as otherwise provided herein, the parties shall
reimburse Lead Title Company in equal shares for all reasonable costs and
expenses incurred in performing its duties as escrow holder including, but not
limited to, reasonable attorneys' fees, disbursements and court costs, either
paid to retained attorneys or in an amount representing the fair value of legal
services rendered to itself, disbursements and court costs. Lead Title Company
is acting hereunder as a depository only and is not responsible or liable in any
manner whatsoever for the sufficiency, correctness, genuineness or validity of
any instrument deposited with it or any notice or demand given to it or for the
form or execution of any such instrument, notice or demand, or for the
identification, authority or rights of any person executing, depositing or
giving the same or for the terms and conditions of any instrument pursuant to
which the parties may act.

                  (h) Lead Title Company is acting solely as a stakeholder with
respect to the Deposit. Lead Title Company shall not have any duties or
responsibilities, except those set forth in this Section 12, and shall not incur
any liability (i) in acting upon any signature, notice, demand, request, waiver,

                                      -33-
<PAGE>

consent, receipt or other paper or document believed by Lead Title Company to be
genuine and Lead Title Company may assume that any person purporting to give it
any notice on behalf of any party in accordance with the provisions hereof has
been duly authorized to do so or (ii) in otherwise acting or failing to act
under this Section 12 except in the case of Lead Title Company's bad faith.
Seller and Purchaser each hereby release Lead Title Company from any act done or
omitted to be done by Lead Title Company in good faith in the performance of its
duties hereunder.

                  (i) Lead Title Company has executed this Agreement for the
sole purpose of confirming its agreements contained in this Section 12.

                  (j) Seller's Federal tax identification number is 76-0615936.
Purchaser's Federal tax identification number is 13-5482050.

                  (k) The provisions of this Section 12 shall survive the
Closing or the termination of this Agreement.

                  [REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]

                                      -34-
<PAGE>

         IN WITNESS WHEREOF, Seller and Purchaser have executed this Agreement
as of the date set forth above.

         SELLER:                     100 COLLEGE ROAD, LLC,
                                     a Delaware limited liability company

                                     By: /s/ C. DEAN PATRINELY
                                         --------------------------------------
                                               C. Dean Patrinely, President

         PURCHASER:                  NEW VALLEY CORPORATION,
                                     a Delaware corporation

                                     By: /s/ BENNETT P. BORKO
                                         --------------------------------------
                                              Bennett P. Borko,
                                              Assistant Secretary

         An original, fully executed copy of this Agreement, together with the
Deposit, has been received by the Lead Title Company this 2nd day of December,
2002, and by execution hereof the Lead Title Company hereby covenants and agrees
to be bound by the terms of Section 12 of this Agreement and hereby covenants
and agrees to enter into a designation agreement in the form attached hereto as
EXHIBIT AA.

                                     FIRST AMERICAN TITLE INSURANCE
                                     COMPANY

                                     By:  /s/ CHRISTOPHER W. BURDICK
                                          -------------------------------------
                                     Name:    CHRISTOPHER W. BURDICK
                                          -------------------------------------
                                     Its:     ASSISTANT VICE PRESIDENT
                                         --------------------------------------

                                      -35-<PAGE>
                                                                     EXHIBIT 4.2

         THIS INDENTURE, dated as of May 8, 2001, by and between REPUBLIC
BANCSHARES, INC., a corporation duly organized and existing under the laws of
the State of Florida (the "Company"), and U.S. BANK TRUST NATIONAL ASSOCIATION
(the "Trustee").

                             RECITALS OF THE COMPANY

         The Company has duly authorized the creation, execution and delivery of
its debentures, to be known as 7% Convertible Subordinated Debentures Due 2011
(the "Debentures"), the amount and terms of which are as hereinafter provided;
and, to provide the terms and conditions upon which the Debentures are to be
authenticated, issued and delivered, the Company has duly authorized the
execution and delivery of this Indenture.

         All acts and things necessary to make the Debentures, when executed by
the Company and authenticated and delivered by the Trustee as in this Indenture
provided, the valid, binding and legal obligations of the Company, and to
constitute these presents as a valid indenture and agreement according to its
terms, have been done and performed, and the execution of this Indenture and the
issue hereunder of the Debentures have in all respects been duly authorized, and
the Company, in the exercise of the legal right and power vested in it, executes
this Indenture and proposes to make, execute, and deliver the Debentures.

                   NOW, THEREFORE, THIS INDENTURE WITNESSETH:

     Each party agrees as follows for the benefit of the other party and for the
equal and proportionate benefit of the Debentureholders (as hereinafter
defined):

                                    ARTICLE I

             Definitions and Other Provisions of General Application

SECTION 1.1.               Definitions.

     For all purposes of this Indenture and of any indenture supplemental
hereto, 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) the term "this Indenture" means this instrument as
         originally executed or as it may from time to time be supplemented or
         amended by one or more indentures supplemental hereto entered into
         pursuant to the applicable provisions hereof;

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

                                       1
<PAGE>

                  (4) all accounting terms not otherwise defined herein have the
         meanings assigned to them in accordance with generally accepted
         accounting principles in effect on the date of execution of this
         Indenture; and

                  (5) all references in this instrument to "Articles",
         "Sections" and other subdivisions are to the designated Articles,
         Sections and other subdivisions of this instrument as originally
         executed; 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;

         Certain terms used principally in Article Seven are defined in that
Article.

         "Act" when used with respect to any Debentureholder has the meaning
specified in Section 1.4.

         "Affiliate" of any specified Person means any other Person directly or
indirectly controlling, 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.

         "Authorized Newspaper" means a newspaper of general circulation in the
relevant area (e.g., in the Place of Payment as provided in Sections 3.7 and
4.3) printed in the English language and customarily published on each Business
Day, whether or not published on Saturdays, Sundays or holidays. Whenever
successive weekly publications in an Authorized Newspaper are required hereunder
they may be made (unless otherwise expressly provided herein) on the same or
different days of the week and in the same or different Authorized Newspapers.

         "Bank Capital Stock" means any and all shares, interests, participation
rights or other equivalents (however designated and whether common, preferred or
other) of the corporate stock of Republic Bank, a Subsidiary of the Company,
together with any and all other securities of Republic Bank convertible or
exchangeable, with or without additional consideration, into the corporate stock
of Republic Bank.

         "Board of Directors" means either the board of directors of the Company
or any duly authorized committee of that board.

         "Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company 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.

                                       2
<PAGE>

         "Business Day" means each day which is neither a Saturday, Sunday nor
other day on which banking institutions in the Place of Payment are authorized
by law or required by executive order to close.

         "Capitalized Lease Obligation" means any lease obligation of a Person
incurred with respect to any property (whether real, personal or mixed) acquired
or leased by such Person and used in its business that is required to be
recorded as a capitalized lease in accordance with generally accepted accounting
principles.

         "Capital Stock" means any and all shares, interests, participation
rights or other equivalents (however designated and whether common, preferred or
other) of corporate stock.

         "Closing Price" means the closing bid price per share of Common Stock
on the Nasdaq National Market or, if then traded on a national securities
exchange, the closing price on that exchange or the highest bid quotation on an
automated quotation system, or if the Common Stock shall not then be listed on
the Nasdaq National Market or on an exchange or included on an automated
quotation system, as reported by the National Quotation Bureau, Inc. or similar
reporting service.

         "Commission" means the Securities and Exchange Commission, as 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 on such date.

         "Common Stock" means the class of stock which, at the date of this
Indenture, is designated as Common Stock, par value $2.00 per share, of the
Company and the class or classes of stock, if any, into which such Common Stock
may thereafter be changed or reclassified.

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

         "Company Request", "Company Order" and "Company Consent" mean,
respectively, a written request, order or consent signed in the name of the
Company by its Chairman of the Board of Directors, President or a Vice
President, and delivered to the Trustee.

         "Conversion Price" means the price per share of Common Stock from time
to time in effect at which Debentures may be converted into Common Stock
pursuant to Article Thirteen.

         "Debentures" means the debentures authenticated and delivered under
this Indenture.

         "Debentureholder" or "Holder" means a Person in whose name a Debenture
is registered in the Debenture Register.

                                       3
<PAGE>

         "Debenture Register" and "Debenture Registrar" have the respective
meanings specified in Section 3.5.

         "Debenture Registration Statement" has the meaning specified in Section
15.2.
         "Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.

         "Defaulted Interest" has the meaning specified in Section 3.7.

         "Depositary" means, if any Depositary is designated by the Company, The
Depositary Trust Company or any other clearing agency registered under the
Exchange Act subsequently designated as Depositary by the Company.

         "Event of Default" has the meaning specified in Section 6.1.

         "Exchange Act" means the Securities Exchange Act of 1934 (15 U.S.C.
ss.ss.78a-78jj), as in force at the date as of which this instrument was
executed, or as hereafter amended.

         "Indebtedness" means (i) all Obligations of the Company for borrowed
money (whether or not the recourse of the lender is to the whole of the assets
of the Company or only to a portion thereof), (ii) all indebtedness of the
Company which is evidenced by a note, debenture, bond or other similar
instrument, including Capitalized Lease Obligations, (iii) all indebtedness of
the Company representing the unpaid balance of the purchase price of any goods
or other property or balance owed for any services rendered, (iv) all
indebtedness of the Company, including Capitalized Lease Obligations incurred,
assumed or given in an acquisition (whether by way of purchase, merger or
otherwise) of any business, real property or other assets, (v) any indebtedness
of others described in the preceding clauses (i), (ii), (iii) and (iv) that the
Company has guaranteed or for which it is otherwise liable and (vi) any
amendment, renewal, extension, deferral, modification, restructuring or
refunding of any such indebtedness, obligation or guarantee.

         "Interest Payment Date" means the Stated Maturity of an installment of
interest on the Debentures.

         "Junior Debt" means the Company's 9.10% Junior Subordinated Debentures
issued under an Indenture dated July 31, 1997, and the Company's 7% Convertible
Subordinated Debentures issued under an Indenture dated September 17, 1999 and
any other Indebtedness of the Company which, by the terms creating or evidencing
the same, it is provided that such Indebtedness is subordinated to the
Debentures.

                                       4
<PAGE>

         "Maturity" when used with respect to any Debenture means the date on
which the principal of and interest on such Debenture becomes due and payable as
therein or herein provided, whether at the Stated Maturity or by declaration of
acceleration or otherwise.

         "Obligations" means, with respect to any Indebtedness, any principal,
premium, interest, penalties, fees and other liabilities payable from time to
time and obligations performable under the documentation governing such
Indebtedness.

         "Officers' Certificate" means a certificate signed by the Chairman of
the Board of Directors, the President or a Vice President, and by the Chief
Financial Officer, the Treasurer, an Assistant Treasurer, the Controller, an
Assistant Controller, the Secretary or an Assistant Secretary of the Company,
and delivered to the Trustee.

         "Opinion of Counsel" means a written opinion of counsel, who may,
except as otherwise expressly provided in this Indenture, be counsel for the
Company.

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

                  (i) Debentures theretofore cancelled by the Trustee or
         delivered to the Trustee for cancellation;

                  (ii) Debentures for whose payment money in the necessary
         amount has been theretofore deposited with the Trustee or any Paying
         Agent in trust for the Holders of such Debentures;

                  (iii) Debentures in exchange for or in lieu of which other
         Debentures have been authenticated and delivered pursuant to this
         Indenture; and

                  (iv) Debentures which have been surrendered for conversion
         pursuant to Article Thirteen;

provided, however, that in determining whether the Holders of the requisite
principal amount of Debentures Outstanding have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Debentures owned
by the Company or any other obligor upon the Debentures or any Affiliate of the
Company or 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 or waiver, only Debentures which the Trustee knows to be so owned shall
be so disregarded. Debentures 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

                                       5
<PAGE>

Debentures and that the pledgee is not the Company or any other obligor upon the
Debentures or any Affiliate of the Company or such other obligor.

         "Paying Agent" means any Person authorized by the Company to pay the
principal of or interest on any Debentures on behalf of the Company. The Company
or any of its subsidiaries may act as Paying Agent.

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

         "Place of Payment" means a city or political subdivision thereof
designated as such by the Company in accordance with the terms of this
Indenture.

         "Predecessor Debentures" of any particular Debenture means every
previous Debenture evidencing all or a portion of the same debt as that
evidenced by such particular Debenture; and, for the purposes of this
definition, any Debenture authenticated and delivered under Section 3.6 in lieu
of a mutilated, lost, destroyed or stolen Debenture shall be deemed to evidence
the same debt as the mutilated, lost, destroyed or stolen Debenture.

         "Principal Corporate Trust Office" means the principal corporate trust
office of the Trustee at the location set forth in Section 1.5 or at such other
location as the Trustee may from time to time designate by written notice to the
Company.

         "Regular Record Date" for the interest payable on any Interest Payment
Date means the close of business on the 15th day of the calendar month
immediately preceding the calendar month in which such Interest Payment Date
occurs, whether or not a Business Day.

         "Responsible Officer" when used with respect to the Trustee means the
chairman or the vice chairman of the board of directors, the chairman or vice
chairman of the executive committee of the board of directors, the president,
any vice-president, the secretary, any assistant secretary, the treasurer, any
assistant treasurer, the cashier, any assistant cashier, any trust officer or
assistant trust officer, the controller and any assistant controller 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.

         "Responsible Officer of the Company" shall mean the Chairman or Vice
Chairman of the Board of Directors, the President, any Vice-President, the Chief
Financial Officer, the Treasurer, the Controller or the Secretary of the
Company.

                                       6
<PAGE>

         "Securities Act" means the Securities Act of 1933 (15 U.S.C.
ss.ss.77a-77aa), as in force at the date as of which this instrument was
executed, or as hereafter amended.

         "Senior Indebtedness" means any and all Indebtedness of the Company,
except any particular Indebtedness, the instrument creating or evidencing the
same or pursuant to which the same is outstanding expressly provides that such
Indebtedness shall be subordinate or shall rank pari passu in right of payment
to the Debentures. The Company's Junior Debt is not Senior Indebtedness.

         "Special Payment Date" has the meaning specified in Section 3.7.

         "Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.7.

         "Stated Maturity" when used with respect to any Debenture means the
date specified in such Debenture as the fixed date on which the principal of and
the interest on such Debenture is due and payable.

         "Subsidiary" means, with respect to the Company, any corporation,
association or other business entity of which more than fifty percent (50%) of
the total voting power of shares of Capital Stock entitled (without regard to
the occurrence of any contingency) to vote in the election of directors,
officers or trustees thereof is at the time owned in the aggregate, directly or
indirectly, by the Company and its Subsidiaries.

         "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 such successor Trustee.

         "Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939
(15 U.S.C. ss.ss.77aaa-77bbbb), as in force at the date as of which this
instrument was executed, except as provided in Section 8.5.

         "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".

         "U.S. Government Obligations" means direct obligations of the United
States of America for the payment of which the full faith and credit of the
United States of America is pledged.

SECTION 1.2.               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 an Officers' Certificate

                                       7
<PAGE>

stating that all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with and, to the extent
requested by the Trustee, an Opinion of Counsel stating that in the opinion of
such counsel all such conditions precedent, if any, have been complied with,
except that in the case of any such application or request as to which the
furnishing of such documents is specifically required by any provision of this
Indenture relating to such particular application or request, no additional
certificate or opinion need be furnished.

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

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

                  (b) 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;

                  (c) 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

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

SECTION 1.3.               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 such counsel's 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 such certificate or opinion or representations are erroneous.

                                       8
<PAGE>

         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.

SECTION 1.4.               Action by Debentureholders.

         (a)      Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken
by Debentureholders may be embodied in and evidenced by (i) one or more
instruments of substantially similar tenor signed by such Debentureholders in
person or by agent or proxy duly appointed in writing. Except as herein
otherwise expressly provided, 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 Debentureholders 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
Sections 7.1 and 7.3) conclusive in favor of the Trustee and the Company, if
made in the manner provided in this Section.

         (b)      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 the certificate of any 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 an officer of a corporation or association or a member of a
partnership or an employee of a public or governmental agency on behalf of such
corporation, association, partnership or agency, or by an agent or fiduciary,
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.

         (c)      The ownership of Debentures shall be proved by the Debenture
Register or by a certificate of the Debenture Registrar thereof.

         (d)      At any time prior to the taking of any action by the Holders
of the percentage in aggregate principal amount of the Debentures specified in
this Indenture in connection with such action, any Holder which has consented to
such action may, by filing written notice with the Trustee at its Principal
Corporate Trust Office and upon proof of holding as provided in this Section
1.4, revoke such action so far as concerns such Debenture. Except as aforesaid,
any request, demand, authorization, direction, notice, consent, waiver or other
action by the Holder of any Debenture shall be conclusive and binding upon such
Holder and upon all future Holders of such Debenture and of every Debenture
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

                                       9
<PAGE>

made upon such Debenture. Any action taken by the Holders of the percentage in
aggregate principal amount of the Debentures specified in the Indenture in
connection with such action shall be conclusive and binding upon the Company,
the Trustee and the Holders of all of the Debentures.

         (e)      If the Company shall solicit from the Holders any request,
demand, authorization, direction, notice, consent, waiver or other action, the
Company may, at its option, by or pursuant to a Board Resolution, fix in advance
a record date for the determination of Holders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or other action, but
the Company shall have no obligation to do so. If such a record date is fixed,
such request, demand, authorization, direction, notice, consent, waiver or other
action may be given before or after such record date, but only Holders of record
at the close of business on such record date shall be deemed to be the Holders
for the purposes of determining whether Holders of the requisite proportion of
Outstanding Debentures have authorized or agreed or consented to such request,
demand, authorization, direction, notice, consent, waiver or other action, and
for that purpose the Outstanding Debentures shall be computed as of such record
date; provided that no such authorization, agreement or consent by the Holders
on such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than six months after the
record date.

SECTION 1.5.               Notices, etc., to Trustee and Company.

         Any request, demand, authorization, direction, notice, consent, waiver
or Act of Debentureholders 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 Debentureholder or by the Company
         shall be sufficient for every purpose hereunder if and only if made,
         given, furnished or filed in writing to or with the Corporate Trust
         Department of the Trustee at the Principal Corporate Trust Office which
         at the date of this Indenture is 500 West Cypress Creek Road, Suite
         560, Fort Lauderdale, Florida 33309, or

                  (2)      the Company by the Trustee or by any Debentureholder
         shall be sufficient for every purpose hereunder if in writing and
         mailed, first-class, postage prepaid, to the Company addressed to it at
         111 Second Avenue N.E., Suite 300, St. Petersburg, Florida 33701, to
         the attention of the Corporate Secretary, or at any other address
         furnished in writing to the Trustee by the Company.

Notwithstanding the foregoing, the Debentures first presented to the Trustee for
authentication after the execution and delivery of this Indenture may be
delivered by the Company for authentication, together with a Company Order of
the authentication and delivery of such Debentures, at Atlanta, Georgia, or at
such other place as may be determined by the Company and reasonably acceptable
to the Trustee.

                                       10
<PAGE>

SECTION 1.6.               Notices to Debentureholders; Waiver.

         Where this Indenture provides for notice to Debentureholders 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 Debentureholder affected by such event, at his address as it appears on the
Debenture Register, not later than the latest date, and not earlier than the
earliest date, prescribed for the giving of such notice. In any case where
notice to Debentureholders is given by mail, neither the failure to mail such
notice, nor any defect in any notice so mailed, to any particular
Debentureholder shall affect the sufficiency of such notice with respect to
other Debentureholders. 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 equivalent of
such notice. Waivers of notice by Debentureholders 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 or irregularities in regular
mail service, it shall be impractical to mail notice of any event to
Debentureholders when such notice is required to be given pursuant to any
provision of this Indenture, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice.

         In case, by reason of the suspension of publication of any Authorized
Newspaper, or by reason of any other cause, it shall be impossible to make
publication of any notice in an Authorized Newspaper or Authorized Newspapers as
required by this Indenture, then such method of publication or notification as
shall be made with the approval of the Trustee shall constitute a sufficient
publication of such notice.

SECTION 1.7.               Conflict with Trust Indenture Act.

         This Indenture is prepared as if subject to the TIA, but without formal
qualification thereunder, and if any provision hereof limits, qualifies or
conflicts with another provision hereof that is required to be included in this
Indenture by any of the provisions of TIA, such TIA-required provision shall
control.

SECTION 1.8.               Effect of Headings and Table of Contents.

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

SECTION 1.9.               Successors and Assigns.

                                       11
<PAGE>

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

SECTION 1.10.     Separability Clause.

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

SECTION 1.11.     Benefits of Indenture.

         Nothing in this Indenture or in the Debentures, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder, the holders of Senior Indebtedness and the Debentureholders, any
benefit or any legal or equitable right, remedy or claim under this Indenture.

SECTION 1.12.     Legal Holidays.

         In any case where the date of an Interest Payment Date or the Stated
Maturity of any Debenture shall not be a Business Day, then (notwithstanding any
other provision of the Debentures or this Indenture) payment of the principal
of, or interest on, any Debentures need not be made on such date, but may be
made on the next succeeding Business Day with the same force and effect as if
made on the nominal date of any such Interest Payment Date or Stated Maturity.

SECTION 1.13.     Governing Law.

         This Indenture and the Debentures issued hereunder shall be controlled,
construed and enforced in accordance with the laws of the State of Florida
applicable to contracts made and to be performed entirely in that State.

                                   ARTICLE II

                                 Debenture Forms

SECTION 2.1.               Forms Generally.

         The Debentures and the certificates of authentication thereon shall be
in substantially the forms set forth in this Article, 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 as may,
consistent herewith, be determined

                                       12
<PAGE>

by the officers executing such Debentures, as evidenced by their execution of
the Debentures. Any portion of the text of any Debenture may be set forth on the
reverse thereof, with an appropriate reference thereto on the face of the
Debenture.

         The definitive Debentures shall be printed, lithographed or engraved on
steel engaged borders or may be produced in any other manner, all as determined
by the officers executing such Debentures as evidenced by their execution of
such Debentures.

SECTION 2.2.               Debentures in Global Form.

         The Debentures may be issued in whole or in part in global form and any
such Debenture in global form may provide that it shall represent the aggregate
or specified amount of Outstanding Debentures from time to time endorsed thereon
and may also provide that the aggregate amount of Outstanding Debentures
represented thereby may from time to time be reduced to reflect exchanges. Any
endorsement of a Debenture in global form to reflect the amount, or any increase
or decrease in the amount or changes in the rights of Holders of Outstanding
Debentures represented thereby, shall be made in such manner and by such Person
or Persons as shall be specified therein. Any instructions by the Company with
respect to a Debenture in global form shall be in writing but, to the extent not
relevant, need not comply with Section 314(c) of the Trust Indenture Act.

SECTION 2.3.               Form of Debenture.

         The Debentures shall include one or more legends required in the
judgment of the Company by applicable securities laws. Each Holder shall be
deemed to have agreed to the imposition of such legends by acceptance of a
Debenture or shares of Common Stock issued upon conversion thereof, and to have
agreed that so long as any of such legends remain on the certificates evidencing
such securities, prior to any transfer (including the sale, assignment, pledge,
hypothecation, gift or other transfer) of any of the same, to comply in all
respects with such legend requirements. Each certificate evidencing the
Debentures and the shares of Common Stock issued upon conversion of a Debenture
shall, upon any such transfer, bear such legends unless, immediately following
such transfer, such securities are no longer subject to restriction on transfer
under any applicable securities laws.

                                       13
<PAGE>

                           [FORM OF FACE OF DEBENTURE]
                            REPUBLIC BANCSHARES, INC.
                     7% Convertible Subordinated Debentures
                                    Due 2011

                             [CUSIP NO. 759929 AD 4]

         THIS IS NOT A DEPOSIT, SAVINGS ACCOUNT OR OTHER OBLIGATION OF ANY BANK
         OR SAVINGS INSTITUTION, AND IS NOT INSURED BY THE BANK INSURANCE FUND
         OR THE SAVINGS ASSOCIATION INSURANCE FUND OF THE FEDERAL DEPOSIT
         INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.

         THIS DEBENTURE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
         1933, AS AMENDED, AND MAY NOT BE OFFERED, SOLD, PLEDGED, HYPOTHECATED,
         EXCHANGED, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER
         THAT ACT AND ANY APPLICABLE STATE SECURITIES OR "BLUE SKY" LAWS, OR AN
         OPINION OF COUNSEL SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT
         SUCH REGISTRATION IS NOT NECESSARY HAS BEEN DELIVERED TO THE COMPANY
         AND THE TRUSTEE.

No.                                                                         $
   ---------------------------

                                       14
<PAGE>

         REPUBLIC BANCSHARES, INC.

promises to pay to ________________, or registered assigns, the principal sum of
______________Dollars ($_______) on April 1, 2011.

Interest Payment Dates:    April 1 and October 1

Record Dates:              March 15 and September 15 (whether or not a Business
                           Day)

                                        Dated:                            , 2001
                                              ---------------------------

                                        REPUBLIC BANCSHARES, INC.,
                                        a Florida corporation

                                        By:

                                        By:

                                        (SEAL)

This is one of the Debentures
referred to in the within-
mentioned Indenture:

U.S. Bank Trust National Association, as Trustee

By:
         Vice President

                                       15
<PAGE>

                            REPUBLIC BANCSHARES, INC.

                     7% Convertible Subordinated Debentures
                                    Due 2011

         1.       Interest. Republic Bancshares, Inc., a corporation duly
organized and existing under the laws of the State of Florida (the "Company"),
promises to pay simple interest on the principal amount of this Debenture at the
rate per annum shown above from the date of issuance until maturity. The Company
will pay interest semi-annually on each April 1 and October 1 of each year, or
if any such day is not a Business Day (as defined in the Indenture), on the next
succeeding Business Day (each an "Interest Payment Date").

         Interest on the Debentures will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the date of
issuance; provided, that if there is no existing Default in the payment of
interest, and if this Debenture is authenticated between a record date referred
to on the face hereof and the next succeeding Interest Payment Date, interest
shall accrue from such next succeeding Interest Payment Date; provided further,
that the first Interest Payment Date shall be October 1, 2001. The Company shall
pay interest on overdue principal at the then applicable interest rate on the
Debentures; it shall pay interest on overdue installments of interest (without
regard to any applicable grace periods) at the same rate to the extent lawful.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.

         2.       Method of Payment. The Company will pay interest on the
Debentures (except defaulted interest) to the Persons who are registered Holders
of Debentures at the close of business on the record date next preceding the
Interest Payment Date, even if such Debentures are cancelled after such record
date and on or before such Interest Payment Date. The Holder must surrender this
Debenture to a Paying Agent to collect principal payments. The Company will pay
principal and interest in money of the United States that at the time of payment
is legal tender for payment of public and private debts. The Company, however,
may pay principal and interest by check payable in such money. It may mail an
interest check to a Holder's registered address.

         3.       Paying Agent and Registrar. Initially, the Trustee will act as
Paying Agent and Debenture Registrar. The Company may change any Paying Agent,
Debenture Registrar or co-registrar without notice to any Debentureholder. The
Company may act in any such capacity.

         4.       Indenture. This Debenture is one of a duly authorized issue of
Debentures of the Company issued under and pursuant to an Indenture dated as of
May 8, 2001 and all indentures supplemental thereto (herein referred to as the
"Indenture") between the Company and the Trustee. The terms of the Debentures
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939 (15 U.S.C. ss.ss. 77aaa-77bbbb) as
in effect on the date of the Indenture. The Debentures are subject to all such
terms, and Debentureholders are referred to the Indenture and such Act for a
statement of such terms. The Debentures are

                                       16
<PAGE>

limited to $15,000,000 in aggregate principal amount. Capitalized terms used in
this Debenture and not defined in this Debenture shall have the meanings set
forth in the Indenture.

         5.       Optional Redemption. The Debentures shall be redeemable at the
option of the Company, in whole or in part, on not less than thirty (30) days
notice, but not more than sixty (60) days prior to the date fixed for
redemption, under the circumstances described herein. Under each of these
circumstances, amounts required to be paid on redemption shall include accrued
interest, if any, to the redemption date.

         First, the Company may redeem all or any of the Debentures at any time,
or from time to time, after April 1, 2006, at the following redemption prices
(expressed as percentages of principal amount), when redeemed during the
12-month periods indicated below:

<TABLE>
<CAPTION>
         April 1      through       March 31
         -------                    --------
         <S>                        <C>
           2006                       2007 ...................................106%
           2007                       2008 ...................................104.5%
           2008                       2009 ...................................103%
           2009                       2010 ...................................101.5%
           2010 and thereafter             ...................................100%
</TABLE>

         Second, the Company may redeem all or any of the Debentures at any time
after April 1, 2003, or from time to time thereafter, without the payment of any
premium, after the Closing Price (as defined in the Indenture) of the Common
Stock for not less than twenty (20) consecutive trading days equals or exceeds
130% of the Conversion Price then in effect.

If the redemption date is subsequent to a record date with respect to any
Interest Payment Date, and on or prior to such Interest Payment Date the Holder
of such Debenture transfers the Debenture, then such accrued interest, if any,
shall be paid to the person who surrenders the Debenture for redemption (and not
the Holder as of the record date with respect to such Interest Payment Date),
and no other interest shall be payable thereon.

         6.       Mandatory Redemption. The Company shall have no mandatory
redemption or sinking fund obligations with respect to the Debentures.

         7.       Notice of Redemption. Notice of redemption shall be mailed at
least thirty (30) days but not more than sixty (60) days before the redemption
date, to each Holder of Debentures to be redeemed at its registered address.
Debentures may be redeemed in part but only in whole multiples of $5,000, unless
all of the Debentures held by a Holder are to be redeemed. On and after the
redemption date, interest ceases to accrue on Debentures or portions of them
called for redemption.

         8.       Registration under Securities Act. At the expense of the
Company, the Debentures, and shares of Common Stock issued or issuable upon
conversion thereof, shall be entitled to registration under applicable
securities laws to the extent set forth in the Indenture.

                                       17
<PAGE>

         9.       Conversion of Debenture. Subject to the provisions of the
Indenture, the Holder of this Debenture is entitled, at his option, at any time
prior to maturity, to convert each $5,000 principal amount of each authorized
$5,000 denomination of this Debenture (in increments of $5,000 or whole
multiples thereof) into 320.5128 shares of Common Stock of the Company (a
Conversion Price of $15.60 principal amount of Debentures for each share of such
Common Stock), or at the adjusted Conversion Price in effect at the date of
conversion determined as provided in the Indenture, as said shares of Common
Stock of the Company shall be constituted at the date of conversion, except
that, in case this Debenture or any portion thereof shall be called for
redemption, such conversion right shall terminate with respect to this Debenture
or portion thereof, as the case may be, so called for redemption at the close of
business on the third (3rd) business day next preceding the date fixed for
redemption as provided in the Indenture. Subject to the foregoing, conversion
may be effected upon surrender of this Debenture to the Debenture Registrar
accompanied by written notice of election to convert, and (if new Debentures for
the unconverted portion of any Debenture shall be registered in a name other
than that of the Holder) by instruments of transfer, in form satisfactory to the
Debenture Registrar, duly executed by the registered Holder or by his duly
authorized attorney. Such surrender shall, if made during the period from the
close of business on the record date preceding an Interest Payment Date to the
opening of business on such Interest Payment Date (unless this Debenture or the
portion being converted shall have been called for redemption), also be
accompanied by payment in funds acceptable to the Company of an amount equal to
the interest payable on such Interest Payment Date on the principal amount of
this Debenture then being converted. Subject to the foregoing, no adjustment is
to be made on conversion for interest accrued hereon (unless this Debenture or
the portion thereof being converted shall have been called for redemption) or
for dividends on Common Stock issued on conversion. The Company is not required
to issue fractional shares upon any such conversion, but shall make adjustment
therefor in cash on the basis of the current market value of such fractional
interest as provided in the Indenture.

         10.      Denominations, Transfer, Exchange. The Debentures are in
registered form without coupons and only in denominations of $5,000 and integral
multiples thereof. As provided in the Indenture, and subject to certain
limitations therein set forth, Debentures may be surrendered for exchange or
transfer for a like aggregate principal amount of Debentures of the same or
different authorized denominations, as requested by the Holder surrendering the
same. The Debenture Registrar and the Trustee may require the Holder to furnish
appropriate endorsements and transfer documents and to pay a sum sufficient to
cover any tax or other governmental charges that may be imposed in connection
with the requested exchange or transfer. The Debenture Registrar need not
exchange or register the transfer of any Debentures or portion of a Debenture
selected for redemption. Also, it need not exchange or register the transfer of
any Debentures for a period of fifteen (15) days before a selection of
Debentures to be redeemed or during the period between a record date and the
next succeeding Interest Payment Date.

         11.      Persons Deemed Owners. Prior to due presentment to the Trustee
for registration of the transfer of this Debenture, the Company, the Trustee and
their respective agents may deem and treat the person in whose name this
Debenture is registered as the absolute owner hereof,

                                       18
<PAGE>

whether or not this Debenture shall be overdue and notwithstanding any notation
of ownership or other writing hereon, for the purpose of receiving payment of or
on account of the principal hereof and interest hereon, and for all other
purposes, and neither the Company, the Trustee, nor their agents shall be
affected by any notice to the contrary. The registered Holder of a Debenture
shall be treated as its owner for all purposes.

         12.      Amendments and Waivers. Subject to certain exceptions, the
Indenture or the Debentures may be amended with the consent of the Holders of at
least 662/3% in principal amount of the then outstanding Debentures, and any
existing default (except a payment default) may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding
Debentures. Without the consent of any Debentureholder, the Indenture or the
Debentures may be amended to cure any ambiguity, defect or inconsistency, to
provide for assumption of Company obligations to Debentureholders, to provide
for uncertificated Debentures in addition to certificated Debentures, or to make
any change that does not adversely affect the rights of any Debentureholder.

         13.      Defaults and Remedies. Events of Default include: default in
payment of interest on the Debentures for thirty (30) days; default in payment
of principal on the Debentures at maturity, upon acceleration, redemption or
otherwise; failure by the Company for the period specified in the Indenture
after notice to it to perform certain covenants and to comply with any of its
other agreements in the Indenture or the Debentures; certain final judgments
which remain undischarged; and certain events of bankruptcy of the Company. If
an Event of Default resulting from such events of bankruptcy of the Company
occurs and is continuing, the Trustee or the Holders of at least 30% in
principal amount of the then outstanding Debentures may declare all the
Debentures to be due and payable immediately. If other Events of Default under
the Indenture shall have occurred and be continuing, the Trustee may, in its
discretion and subject to the indemnity provisions referenced hereinafter,
proceed to protect and enforce its rights and the rights of the Holders by such
appropriate judicial proceedings as the Trustee shall deem most effectual under
the circumstances. Debentureholders may not enforce the Indenture or the
Debentures except as provided in the Indenture. The Trustee may require
indemnity satisfactory to it before it enforces the Indenture or the Debentures.
Subject to certain limitations (including the indemnity referenced in the
foregoing sentence), Holders of a majority in principal amount of the then
outstanding Debentures may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Debentureholders notice of any continuing
default (except a default in payment of principal or interest) if it determines
that withholding notice is in their interests. The Company must furnish an
annual compliance certificate to the Trustee.

         14.      Trustee Dealings with the Company. 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.

         15.      Ranking; Subordination. The indebtedness evidenced by the
Debentures is senior in right of payment to the Junior Debt. The indebtedness
evidenced by the Debentures is, to the

                                       19
<PAGE>

extent provided in the Indenture, subordinate and subject in right of payment to
the prior payment in full of all Senior Indebtedness of the Company whether
outstanding on the date of the Indenture or thereafter created, incurred,
assumed or guaranteed, and is not secured by any collateral, neither the assets
of the Company nor any of its Affiliates or Subsidiaries. Each Holder, by
acceptance hereof, agrees to and shall be bound by all provisions of the
Indenture. Further, each Holder authorizes and directs the Trustee to take such
action on its behalf as may be necessary or appropriate to acknowledge or
effectuate, as between such Holder and the holders of Senior Indebtedness, the
subordination of this Debenture as provided in the Indenture, and appoints the
Trustee its attorney-in-fact for any and all such purposes.

         16.      No Recourse Against Others. No recourse shall be had for the
payment of the principal of or the interest on this Debenture, or for any claim
based hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture against any Affiliate, stockholder, officer, director, or employee, as
such, past, present or future, of the Company, its Subsidiaries, or any
predecessor or successor corporations, or entities, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise, all such liability being, by the acceptance hereof and as
part of the consideration for the issue hereof, expressly waived and released.

         17.      Authentication. This Debenture shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.

         18.      Abbreviations. Customary abbreviations may be used in the name
of a Debentureholder 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), U/G/M/A (=
Uniform Gifts to Minors Act) and U/T/M/A (= Uniform Transfers to Minors Act).

     The Company will furnish to any Debentureholder upon written request and
without charge a copy of the Indenture. Request may be made to:

                  Republic Bancshares, Inc.
                  111 Second Avenue N.E., Suite 300
                  St. Petersburg, Florida 33701
                  Attention:  Corporate Secretary

                                       20
<PAGE>

                                 ASSIGNMENT FORM

         To assign this Debenture, fill in the form below: (I) or (we) assign
and transfer this Debenture to

                  (Insert assignee's soc. sec. or tax I.D. no.)

         (Print or type assignee's name, address and zip code) and irrevocably
appoint ___________________________________ agent to transfer this Debenture 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 face
                                of this Debenture)

Signature Guarantee:

                                       21
<PAGE>

                           [FORM OF CONVERSION NOTICE]

                            REPUBLIC BANCSHARES, INC.

         The undersigned owner of this Debenture hereby irrevocably exercises
the option to convert this Debenture, or the portion hereof (which is $5,000 or
a whole multiple thereof) below designated, into shares of Common Stock of
Republic Bancshares, Inc. in accordance with the terms of the Indenture referred
to in this Debenture, and directs that the shares issuable and deliverable upon
the conversion, together with any check in payment for fractional shares and any
Debentures representing any unconverted principal amount hereof, be issuable and
delivered to the registered holder hereof unless a different name has been
indicated below. If shares are to be issued in the name of a person other than
the undersigned, the undersigned will pay all transfer taxes payable with
respect thereto. Any amount required to be paid by the undersigned on account of
interest accompanies this Debenture.

$
Principal Amount to be Converted
(in a whole multiple of $5,000
if less than all)

Fill in for registration of shares of Common Stock and Debentures if to be
issued otherwise than to the registered holder.

-----------------------
Name                                  Other person's Social Security or other
                                      taxpayer identifying number

Address

Please print your name and address including zip code:

                                      Date:
-------------------------------
Signature

Signature Guaranteed:

                                       22
<PAGE>

                                   ARTICLE III

                                 The Debentures

SECTION 3.1.               General Title; General Limitations; Terms of
                           Debenture.

         The Debentures shall be known and designated as the "7% Convertible
Subordinated Debentures Due 2011" of the Company. Their Stated Maturity shall be
April 1, 2011, and they shall bear simple interest at the rate of 7% per annum
commencing upon the date of issuance until Maturity. Interest on each Debenture
shall be payable on the dates specified in the form of Debenture set forth in
Section 2.3. The aggregate principal amount of Debentures which may be
authenticated and delivered under this Indenture is limited to $15,000,000,
except for Debentures authenticated and delivered upon registration for transfer
of or in exchange for or in lieu of other Debentures, as provided herein.

         The Person in whose name any Debenture is registered on the Regular
Record Date with respect to an Interest Payment Date will be entitled to receive
the interest payable on such Interest Payment Date, notwithstanding the
cancellation of such Debenture upon any registration of transfer or exchange or
conversion thereof subsequent to such Regular Record Date and prior to such
Interest Payment Date.

         The principal of and interest on the Debentures shall be payable in
such coin or currency of the United States of America as at the time of payment
is legal tender for public and private debts. Unless other arrangements are made
with the Debentureholders of record, interest payments shall be made by check
mailed to the Persons entitled thereto at their addresses last appearing on the
Debenture Register. Holders of Debentures must surrender Debentures at the
office or agency of the Company in the Place of Payment to collect the principal
payment on the Debentures.

         The indebtedness evidenced by the Debentures is senior in right of
payment to the Junior Debt. The Debentures shall be subordinated in right of
payment to Senior Indebtedness of the Company as provided in Article Eleven.

SECTION 3.2.               Denominations.

         The Debentures shall be issuable only in fully registered form and
without coupons in denominations of $5,000 and any integral multiples thereof.

SECTION 3.3.               Execution, Authentication and Delivery.

         The Debentures shall be executed on behalf of the Company by its
Chairman of the Board of Directors, its President or one of its Vice Presidents
under its corporate seal, which may be in facsimile form and may be imprinted or
otherwise reproduced thereon and attested by its Secretary or its Assistant
Secretary. The signature of any of these officers on the Debentures may be
manual or facsimile.

                                       23
<PAGE>

         Debentures 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 Debentures or did not
hold such offices at the date of such Debentures.

         At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Debentures executed by the Company to
the Trustee for authentication, together with a Company Order of the
authentication and delivery of such Debentures; and the Trustee shall
authenticate and deliver such Debentures as in this Indenture provided and not
otherwise. All Debentures shall be dated the date of their authentication.

         Notwithstanding the foregoing, if the Debentures are to be issued in
whole or in part in global form, then the Company shall execute and the Trustee
shall, in accordance with this Section and the Company Order with respect to
such Debentures, authenticate and make available for delivery one or more
Debentures in global form that (i) shall represent and shall be denominated in
an amount equal to the aggregate principal amount of the Outstanding Debentures,
(ii) shall be registered in the name of the Depositary, if any, for such
Debentures or the nominee of such Depositary, (iii) shall be delivered by the
Trustee to such Depositary, if any, or pursuant to such Depositary's instruction
and (iv) shall bear a legend substantially to the following effect: "Unless and
until it is exchanged in whole or in part for Debentures in certificated form,
this Debenture may not be transferred except as a whole by the Depositary to a
nominee of the Depositary or by a nominee of the Depositary to the Depositary or
another nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary" or to such other
effect as such Depositary, if any, and the Trustee may agree.

         Each Depositary, if any, for a Book-Entry Debenture must, at the time
of its designation and at all times while it serves as Depositary, be a clearing
agency registered under the Exchange Act and any other applicable statute or
regulation. The Trustee shall have no responsibility to determine if the
Depositary is so registered. Each Depositary, if any, shall enter into an
agreement with the Trustee governing its respective rights with regard to
Book-Entry Debentures.

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

SECTION 3.4.               Temporary Debentures.

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

                                       24
<PAGE>

issued and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Debentures may determine, as evidenced
by their execution of such Debentures.

         Except in the case of temporary Debentures in global form, which shall
be exchanged in accordance with the provisions hereof, if temporary Debentures
are issued, the Company will cause definitive Debentures to be prepared without
unreasonable delay. After the preparation of definitive Debentures, the
temporary Debentures shall be exchangeable for definitive Debentures upon
surrender of the temporary Debentures at the office or agency of the Company in
the Place of Payment, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Debentures, the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor a like
principal amount of definitive Debentures of authorized denominations. Until so
exchanged, the temporary Debentures shall in all respects be entitled to the
same benefits under this Indenture as definitive Debentures.

SECTION 3.5.               Registration, Registration of Transfer and Exchange.

         The Company shall cause to be kept at the Principal Corporate Trust
Office a register (herein referred to as the "Debenture Register") in which,
subject to such reasonable regulations as it may prescribe, the Company shall
provide for the registration of Debentures and the registration of transfers of
Debentures. Any such register shall be in written form or in any other form
capable of being converted into written form within a reasonable time. The
Trustee is hereby appointed "Debenture Registrar" for the purpose of registering
Debentures and transfers of Debentures as herein provided.

         Prior to the effectiveness of the Debenture Registration Statement as
contemplated by Section 15.2, or the removal by the Company pursuant to Section
15.6 of legends restricting transfer and stop transfer instructions, each
certificate representing a Debenture (whether upon original issuance or issuance
upon any transfer) shall contain one or more legends as contemplated by Section
2.3. One of such legends shall be substantially as follows:

         THIS DEBENTURE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
         1933, AS AMENDED, AND MAY NOT BE OFFERED, SOLD, PLEDGED, HYPOTHECATED,
         EXCHANGED, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER
         THAT ACT AND ANY APPLICABLE STATE SECURITIES OR "BLUE SKY" LAWS, OR AN
         OPINION OF COUNSEL SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT
         SUCH REGISTRATION IS NOT NECESSARY HAS BEEN DELIVERED TO THE COMPANY
         AND THE TRUSTEE.

Accordingly, prior to the effectiveness of the Debenture Registration Statement,
or such removal of legends and stop transfer instructions, Debentures shall not
in any event be transferred by the Debenture Registrar in the absence of a
Company Order to the effect that the Holder requesting the registration of a
transfer has complied with the applicable legend requirements with respect to
such requested transfer. Such Company Order as furnished to the Debenture
Registrar shall be accompanied by a copy of the documentation [e.g., an opinion
of counsel, "accredited investor" and/or "qualified institutional buyer" (as
defined in Rule 501 and Rule 144A, respectively, within the regulations of the
Commission) representations, and investment representations] which the Company
determined to be satisfactory to establish compliance with such legend
requirements.

                                       25
<PAGE>

         Upon presentation or surrender of a Debenture for registration of
transfer or exchange accompanied by a Company Order, if required, at the office
or agency of the Company in the Place of Payment, the Company shall execute, and
the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Debentures of any authorized
denominations, of a like aggregate principal amount. Every presented or
surrendered Debenture shall be duly endorsed, or be accompanied by a written
instrument of transfer duly executed, by the Holder thereof or his attorney duly
authorized in writing in form satisfactory to the Company or the Debenture
Registrar.

         At the option of the Holder, Debentures (except a Book-Entry Debenture
representing all or a portion of the Debentures) may be exchanged for other
Debentures of any authorized denominations, of a like aggregate principal amount
upon surrender of the Debentures to be exchanged at such office or agency.
Whenever any Debentures are so surrendered for exchange, the Company shall
execute, and the Trustee shall authenticate and deliver, the Debentures which
the Debentureholder making the exchange is entitled to receive.

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

         The Company shall not be required (i) to issue, to register the
transfer of or to exchange Debentures during a period beginning at the opening
of business on a Business Day fifteen (15) days before the day of any selection
of Debentures for redemption under Section 12.4 and ending at the close of
business on the day of selection or (ii) to register the transfer of or exchange
of any Debentures so selected for redemption in whole or in part, except the
unredeemed portion of any Debentures being redeemed in part.

         No service charge shall be made for any registration of transfer or
exchange of Debentures, 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 Debentures, other than
exchanges pursuant to Sections 3.4 or 8.6 not involving any transfer.

         Notwithstanding any other provision of this Section, unless and until
it is exchanged in whole or in part for Debentures in certificated form, a
Book-Entry Debenture, if any, may not be transferred except as a whole by any
Depositary to a nominee of such Depositary or by a nominee of such Depositary to
such Depositary or another nominee of any such Depositary or by any such
Depositary or any such nominee to a successor Depositary or a nominee of any
such successor Depositary.

         If at any time the Depositary, if any, notifies the Company that it is
unwilling or unable to continue as Depositary or if at any time the Depositary,
if any, ceases to be a clearing agency registered under the Exchange Act, the
Company shall appoint such a successor Depositary. If a successor Depositary is
not appointed by the Company within ninety (90) days after the Company

                                       26
<PAGE>

receives such notice or becomes aware of such ineligibility, the Company shall
execute, and the Trustee, upon receipt of a Company Order for the authentication
and delivery of certificated Debentures, shall authenticate and make available
for delivery Debentures in certificated form in an aggregate principal amount
equal to the principal amount of the Book-Entry Debenture or Debentures in
exchange for such Book-Entry Debenture or Debentures.

         The Company may at any time and in its sole discretion, and the Trustee
shall following any Event of Default, determine that the Debentures issued in
the form of one or more global Debentures shall no longer be represented by such
Book-Entry Debentures. In such event the Company shall execute, and the Trustee,
upon receipt of a Company Order for the authentication and delivery of
certificated Debentures, shall authenticate and make available for delivery,
Debentures in certificated form and in an aggregate principal amount equal to
the principal amount of the Debenture or Debentures in global form in exchange
for such Debenture or Debentures in global form.

         In any exchange provided for in any of the preceding two paragraphs,
the Company shall execute and the Trustee shall authenticate and make available
for delivery Debentures in certificated form in authorized denominations.

         Upon the exchange of a Book-Entry Debenture, if any, for Debentures in
certificated form, such Book-Entry Debentures shall be cancelled by the Trustee.
Debentures issued in exchange for a Book-Entry Debenture pursuant to this
Section shall be registered in such names and in such authorized denominations
as the Depositary, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee. The Trustee shall make
available for delivery such Debentures to the Persons in whose names such
Debentures are so registered.

SECTION 3.6.               Mutilated, Destroyed, Lost and Stolen Debentures.

         If (i) any mutilated Debenture is surrendered to the Trustee, or if the
Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Debenture, and (ii) there is delivered to the
Company and the Trustee such security or indemnity as may be required by them to
save each of them harmless, then, in the absence of notice to the Company or the
Trustee that such Debenture has been acquired by a bona fide purchaser, the
Company shall execute and upon its request the Trustee shall authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Debenture, a new Debenture of like tenor and principal amount, bearing a
number not contemporaneously outstanding.

         In case any such mutilated, destroyed, lost or stolen Debenture has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Debenture, pay or authorize the payment of such
Debenture (without surrender thereof except in the case of a mutilated
Debenture) if the applicant for such payment shall furnish to the Company (and
to the Trustee, if the Trustee is acting at the time as Paying Agent) such
security or indemnity as it may require to save it harmless and, in the case of
destruction, loss or theft, evidence to the satisfaction of the Company of the
destruction, loss or theft of such Debenture and of the ownership thereof.

                                       27
<PAGE>

         Upon the issuance of any new Debenture 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 Debenture issued pursuant to this Section in lieu of any
mutilated, destroyed, lost or stolen Debenture shall constitute an original
additional contractual obligation of the Company, whether or not the mutilated,
destroyed, lost or stolen Debenture 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 Debentures 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 Debentures.

SECTION 3.7.               Payment of Interest; Interest Rights Preserved.

         Interest on any Debenture 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 Debenture (or one or more Predecessor Debentures) is registered
at the close of business on the Regular Record Date for such interest payment.

         Any interest on any Debenture 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 registered
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 Clause (2) below:

                  (1)      The Company may elect to make payment of any
         Defaulted Interest to the Persons in whose names the Debentures (or
         their respective Predecessor Debentures) 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 Debenture and the date of the proposed
         payment (the "Special Payment Date"), and at the same time the Company
         shall deposit with the Trustee or the Paying Agent (or, if the Company
         is acting as its own Paying Agent, segregate and hold in trust as
         provided in Section 4.3), 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 Special Payment Date, 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 fifteen (15) nor less than ten (10) days prior
         to the Special Payment Date and not less than ten (10) days after the
         receipt by the Trustee

                                       28
<PAGE>

         of the notice of the proposed payment. The Trustee shall promptly
         notify the Company of such Special Record Date and 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 Debentureholder at his address as it appears in the Debenture
         Register, not less than ten (10) days prior to such Special Record
         Date. The Trustee may, in its discretion, in the name and at the
         expense of the Company, cause a similar notice to be published at least
         once in an Authorized Newspaper in the Place of Payment, but such
         publication shall not be a condition precedent to the establishment of
         such Special Record Date. Notice of the proposed payment of such
         Defaulted Interest and the Special Record Date therefor having been
         given as aforesaid, such Defaulted Interest shall be paid on the
         Special Payment Date to the Persons in whose names the Debentures (or
         their respective Predecessor Debentures) 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 in any other lawful manner not inconsistent with the
         requirements of any securities exchange on which the Debentures 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.

SECTION 3.8.               Persons Deemed Owners.

         The Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name any Debenture is registered as the absolute
owner of such Debenture for the purpose of receiving payment of principal of,
premium (if any) on, and, subject to Section 3.7, interest on, such Debenture
and for all other purposes whatsoever, whether or not such Debenture be overdue
and notwithstanding any notation of ownership or other writing thereon, and
neither the Company, the Trustee nor any agent of the Company or the Trustee
shall be affected by notice to the contrary.

SECTION 3.9.               Cancellation.

         All Debentures surrendered for payment, registration of transfer or
exchange or conversion shall, if surrendered to any person other than the
Trustee, be delivered to the Trustee and, if not already cancelled, shall be
promptly cancelled by it. The Company may at any time deliver to the Trustee for
cancellation any Debentures previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and all Debentures
so delivered shall be promptly cancelled by the Trustee. No Debentures shall be
authenticated in lieu of or in exchange for any Debentures cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Debentures held by the Trustee shall be destroyed and the Trustee shall deliver
a certificate of destruction to the Company.

SECTION 3.10.     Computation of Interest.

                                       29
<PAGE>

         Interest on the Debentures shall be computed on the basis of a 360-day
year of twelve 30-day months.

                                   ARTICLE IV

                                    Covenants

SECTION 4.1.               Payment of Principal and Interest.

         The Company will duly and punctually pay the principal of and interest
on the Debentures in accordance with the terms of the Debentures and this
Indenture. If at the applicable time the Trustee is acting as Paying Agent, then
not less than five (5) Business Days prior (if by check) and one (1) Business
Day prior (if by wire transfer) to an Interest Payment Date, the Company shall
deposit with the Trustee money sufficient for such payments.

SECTION 4.2.               Maintenance of Office or Agency.

         The Company will maintain an office or agency in the Place of Payment
where Debentures may be presented or surrendered for payment, where Debentures
may be surrendered for registration of transfer or for exchange or conversion
and where notices and demands to or upon the Company in respect of the
Debentures and this Indenture may be served. The Company will give prompt
written notice to the Trustee of the location, and of any change in the
location, of such office or agency. If at any time the Company shall fail to
maintain such 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 Principal Corporate Trust Office of the Trustee, and the
Company hereby appoints the Trustee its agent to receive all such presentations,
surrenders, notices and demands.

SECTION 4.3.               Money for Debenture Payments to be Held in Trust.

         If the Company shall assume the duties of Paying Agent, it will, on or
before each due date of the principal of or interest or premium, if any, on any
of the Debentures, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal or interest or premium,
if any, 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 to so act.

         Whenever the Company is not acting as its own Paying Agent, it will,
prior to each due date of the principal of or interest on any of the Debentures,
deposit with the Paying Agent a sum sufficient to pay the principal or interest
or premium, if any, so becoming due, such sum to be held in trust for the
benefit of the Persons entitled to such sums, and (unless such Paying Agent is
the Trustee) the Company will promptly notify the Trustee of its action or
failure so to act.

                                       30
<PAGE>

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

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

                  (2)      give the Trustee notice of any default by the Company
         (or any other obligor upon the Debentures) in the making of any payment
         of principal or interest or premium, if any; and

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

         The Company 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 the 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 terms as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
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 interest or
premium, if any, on any Debenture and remaining unclaimed for two (2) years
after such principal or interest or premium, if any, has become due and payable,
shall be paid to the Company upon Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Debenture
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, including any interest thereon, and all liability
of the Company as trustee thereof, shall thereupon cease; provided, however,
that the Trustee or such Paying Agent, before being required to make any such
repayment, shall at the expense of the Company cause to be published once, in an
Authorized Newspaper in the Place of Payment, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than
thirty (30) days from the date of such publication, any unclaimed balance of
such money then remaining will be repaid to the Company.

         The Trustee and the Paying Agent shall promptly pay to the Company upon
Company Request any excess money or securities held by them at any time.

SECTION 4.4.               Payment of Taxes and Other Claims.

         The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, all material taxes, assessments and
governmental charges levied or imposed

                                       31
<PAGE>

upon it or upon its income, profits or property; provided, however, that the
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment or charge whose amount, applicability or
validity is being contested in good faith by appropriate proceedings.

SECTION 4.5.               Maintenance of Properties.

         The Company will, in all material respects, cause all its properties
and the properties of its Subsidiaries used or useful in the conduct of the
business of the Company and its Subsidiaries to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Company may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section shall prevent the Company or a Subsidiary from
discontinuing the operation and maintenance of any of its properties if such
discontinuance is, in the judgment of the Company, desirable in the conduct of
its business and is not disadvantageous in any material respect to the
Debentureholders.

SECTION 4.6.               Statement as to Compliance.

         The Company will deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company, a written statement signed by the Chairman
of the Board of Directors, the President or a Vice President and by the Chief
Financial Officer, the Treasurer, an Assistant Treasurer, the Controller or an
Assistant Controller of the Company, stating, as to each signatory thereof,
that:

                  (1)      a review of the activities of the Company during such
         year and of performance under this Indenture has been made under his
         supervision, and

                  (2)      to the best of his or her knowledge, based on such
         review, the Company has performed and fulfilled all of its obligations
         under this Indenture throughout such year, or, if an Event of Default
         shall have occurred, specifying each such Event of Default known to him
         and the nature and status thereof.

         The Company will, so long as any of the Debentures are Outstanding,
deliver to the Trustee, forthwith upon becoming aware of any Event of Default,
an Officer's Certificate specifying such Event of Default.

SECTION 4.7.               Corporate Existence.

         Subject to Article Nine, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect the corporate
existence, rights (charter and statutory) and franchises of the Company and its
Subsidiaries; provided, however, that the Company shall not be required to
preserve any right or franchise of the Company or its Subsidiaries if the Board
of

                                       32
<PAGE>

Directors shall determine that the preservation thereof is no longer desirable
in the conduct of the business of the Company or its Subsidiaries and that the
loss thereof is not disadvantageous in any material respect to the
Debentureholders.

SECTION 4.8.               Restrictions on Dividends, Redemptions and Other
                           Payments.

         The Company shall not declare or pay any dividends on, or purchase,
redeem or otherwise acquire for value, any of its Capital Stock now or hereafter
outstanding (other than redemption or repurchase of the Debentures in accordance
with the terms of this Indenture) or return any capital to holders of its
Capital Stock as such, or make any distribution of assets to holders of its
Capital Stock as such, unless, from and after the date of any such dividend
declaration (a "Declaration Date") or the date of any such purchase, redemption,
payment or distribution specified above (a "Redemption Date"), the Company
retains cash, cash equivalents (as determined in accordance with generally
accepted accounting principles) or marketable securities (with a market value as
measured on the applicable Declaration Date or Redemption Date) in an amount not
less than the aggregate amount of the two consecutive semi-annual interest
payments that will be due and payable on the Debentures following such
Declaration Date or Redemption Date, as the case may be; provided, however, that
the amount of each semiannual interest payment made by the Company with respect
to the Debentures following such Declaration Date or Redemption Date, as
applicable, shall be deducted from the aggregate amount of cash or cash
equivalents which the Company shall be required to retain pursuant to the
foregoing provision.

SECTION 4.9.               Restrictions on Pledge of Bank Capital Stock.

         From and after the date of this Indenture, and until this Indenture
shall be satisfied and discharged as provided in Section 10.1 and/or the
Debentures have been Discharged (as defined below) as provided in Section 10.3,
the Company may not pledge more than 20% of the outstanding Bank Capital Stock;
provided that, notwithstanding the foregoing, the pledge of Bank Capital Stock
on the date of this Indenture in favor of SunTrust Bank, N.A., shall be
permitted, but only for such reasonably limited period of time as may be
necessary to obtain a release of such pledge in connection with the repayment of
the related Company Indebtedness with proceeds from the issuance of the
Debentures. The term "Pledge" (in any tense) as used in this Section is used in
its broadest sense to include pledge (both negative and affirmative),
hypothecation and any and all other forms of any deposit of property as
security.

                                    ARTICLE V

                   Debentureholders' Lists and Reports by the
                             Trustee and the Company

SECTION 5.1.               Company to Furnish Trustee Names and Addresses of
                           Debentureholders.

         The Company will furnish or cause to be furnished to the Trustee not
more than five (5) days after each Regular Record Date, a list, in such form as
the Trustee may reasonably require, of

                                       33
<PAGE>

the names and addresses of the Holders of Debentures as of such Regular Record
Date; provided, however, that the Company shall not be required to furnish the
Trustee the names and addresses of the Holders of Debentures if the Trustee
receives such names and addresses of the Holders of Debentures in its capacity
as Debenture Registrar.

SECTION 5.2.               Preservation of Information; Communications to
                           Debentureholders.

         (a)      The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders of Debentures
contained in the most recent list furnished to the Trustee as provided in
Section 5.1 and the names and addresses of Holders of Debentures received by the
Trustee at any time that it is acting as Debenture Registrar (if so acting). The
Trustee may destroy any list furnished to it as provided in Section 5.1 upon
receipt of a new list so furnished.

         (b)      The Trustee shall comply with Section 312(b) of the TIA. The
Trustee, the Company, and any other Person shall have the protection of Section
312(c) of the TIA.

SECTION 5.3.               Reports by Trustee.

         (a)      So long as the Debentures are Outstanding, within sixty (60)
days after May 15 of each year (the "Reporting Date"), the Trustee shall, if
required by Section 313(a) of the TIA, transmit by mail to the Company and all
Debentureholders, as their names and addresses appear in the Debenture Register,
a brief report dated as of such Reporting Date that complies with Section 313(a)
of the TIA.

         (b)      A copy of each such report shall, at the time of such
transmission to the Company and the Debentureholders, be filed by the Trustee
with each securities exchange upon which the Debentures are listed, and also
with the Commission. The Company will notify the Trustee in writing when and if
the Debentures are listed on any securities exchange.

SECTION 5.4.               Reports by Company.

         The Company will:

                  (1)      file with the Trustee, within thirty (30) days after
the Company is required to file the same with the Commission, copies of the
annual reports and of the information, documents and other reports (or copies of
such portions of any of the foregoing as the Commission may from time to time by
rules and regulations prescribe) which the Company may be required to file with
the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act; or,
if the Company is not required to file information, documents or reports
pursuant to either of such sections, then it will file with the Trustee and the
Commission, in accordance with rules and regulations prescribed from time to
time by the Commission, such of the supplementary and periodic information,
documents and reports which may be required pursuant to Section 13 of the
Exchange Act in respect of a security listed and registered on a national
securities exchange as may be prescribed from time to time in such rules and
regulations;

                                       34
<PAGE>

                  (2)      file with the Trustee and the Commission, in
accordance with rules and regulations prescribed from time to time by the
Commission, such additional information, documents and reports, if any, with
respect to compliance by the Company with the conditions and covenants of this
Indenture as may be required from time to time by such rules and regulations;

                  (3)      transmit by mail to all Debentureholders as their
names and addresses appear in the Debenture Register, such summaries of any
information, documents and reports required to be filed by the Company pursuant
to paragraphs (1) and (2) of this Section as may be required by rules and
regulations prescribed from time to time by the Commission; and

                  (4)      furnish to the Trustee, not less often than annually,
a brief certificate from the principal executive officer, principal financial
officer or principal accounting officer as to his or her knowledge of the
Company's compliance with all conditions and covenants set forth in Article Four
of this Indenture. For purposes of this paragraph, such compliance shall be
determined without regard to any period of grace or requirement of notice
provided under the Indenture.

                                   ARTICLE VI

                                    Remedies

SECTION 6.1.               Events of Default.

         "Event of Default", wherever used herein, means any one of the
following events, continued for the period of time, if any, and after the giving
of the notice, if any, therein designated (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law 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
         Debenture when it becomes due and payable, and continuance of such
         default for a period of thirty (30) days; or

                  (2)      default in the payment of the principal of any
         Debenture at its Maturity; or

                  (3)      default in the performance, or breach, of any
         material covenant or warranty of the Company in this Indenture (other
         than a covenant or warranty a default in the performance or the breach
         of which is elsewhere in this Section specifically dealt with), and
         continuance of such default or breach for a period of sixty (60) days
         after there has been given, by registered or certified mail, to the
         Company by the Trustee or to the

                                       35
<PAGE>

         Company and the Trustee by the Holders of at least twenty-five percent
         (25%) in aggregate principal amount of the Debentures then Outstanding,
         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

                  (4)      the entry of a decree or order by a court having
         jurisdiction in the premises adjudging the Company a bankrupt, or
         approving as properly filed a petition seeking liquidation,
         reorganization, arrangement, adjustment or composition of or in respect
         of the Company under the Federal Bankruptcy Act or any other applicable
         Federal or State law, and the continuance of any such decree or order
         unstayed and in effect for a period of ninety (90) consecutive days, or
         the institution by the Company of proceedings to be adjudicated a
         bankrupt, or the consent by it to the institution of bankruptcy
         proceedings against it, or the filing by it of a petition or answer or
         consent seeking liquidation, reorganization or relief under the Federal
         Bankruptcy Act or any other similar applicable Federal or State law, or
         the taking of corporate action by the Company in furtherance of any
         such action; or

                  (5)      the entry of a decree or order by a court having
         jurisdiction in the premises appointing a receiver, liquidator,
         assignee, trustee, sequestrator (or other similar official) of the
         Company or of any substantial part of its property, or ordering the
         winding up or liquidation of its affairs, and the continuance of any
         such decree or order unstayed and in effect for a period of ninety (90)
         consecutive days, or the consent by the Company to the appointment of a
         receiver, liquidator, assignee, trustee, sequestrator (or other similar
         official) of the Company or of any substantial part of its property, or
         the making by it of an assignment for the benefit of creditors, or the
         admission by it in writing of its inability to pay its debts generally
         as they become due, or the taking of corporate action by the Company in
         furtherance of any such action.

SECTION 6.2.               Acceleration of Maturity; Rescission and Annulment.

         If an Event of Default described in paragraph (4) of Section 6.1 occurs
and is continuing, then the Trustee or the Holders of not less than thirty
percent (30%) in aggregate principal amount of the Debentures then Outstanding
may declare the principal of all the Debentures to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if given
by the Debentureholders), and upon any such declaration, such principal shall
become immediately due and payable.

         At any time after such a declaration of acceleration 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 Debentures then Outstanding, 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:

                                       36
<PAGE>

                           (a)      all overdue interest on all Debentures;

                           (b)      the principal of any Debentures which have

                  become due otherwise than by such declaration of acceleration
                  and interest thereon at the rate borne by the Debentures; and

                           (c)      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, other than the non-payment of
                  the principal of Debentures which have become due solely by
                  such acceleration, have been cured or waived as provided in
                  Section 6.13.

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

SECTION 6.3.               Suits for Enforcement by Trustee.

         If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Debentureholders 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.

SECTION 6.4.               Trustee May File Proofs of Claim.

         In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company, or any other obligor upon the
Debentures or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Debentures
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise,

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

                                       37
<PAGE>

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

and any receiver, assignee, trustee, liquidator, sequestrator (or other similar
official) in any such judicial proceeding is hereby authorized by each
Debentureholder 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
Debentureholders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.7.

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

SECTION 6.5.               Trustee May Enforce Claims Without Possession of
                           Debentures.

         All rights of action and claims under this Indenture or the Debentures
may be prosecuted and enforced by the Trustee without the possession of any of
the Debentures 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 Debentures in respect of which such
judgment has been recovered.

SECTION 6.6.               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 interest, upon
presentation of the Debentures and the notation thereon of the payment if only
partially paid and upon surrender thereof if fully paid:

         First: To the Trustee for amounts due under Section 7.7;

         Second: To the Debentureholders for amounts then due and unpaid upon
the Debentures for principal and interest, 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 due and payable on such
Debentures for principal and interest, respectively; and

         Third: To the Company.

SECTION 6.7.               Limitation on Suits.

                                       38
<PAGE>

         No Holder of any Debenture 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 and the Company of a continuing Event of Default;

                  (2)      the Holders of not less than thirty percent (30%) in
         aggregate principal amount of the Outstanding Debentures 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 against the costs, expenses and liabilities to be
         incurred in compliance with such request;

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

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

it being understood and intended that no one or more Holders of Debentures 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 Holders or to obtain or to seek to obtain priority or preference over any
other Holders or to enforce any right under this Indenture, except in the manner
herein provided and for the equal and ratable benefit of all the Holders of
Debentures.

SECTION 6.8.               Unconditional Right of Debentureholders to Receive
                           Principal and Interest.

         Notwithstanding any other provision in this Indenture, the Holder of
any Debenture shall have the right which is absolute and unconditional to
receive payment of the principal of and interest on such Debenture on the Stated
Maturity expressed in such Debenture, and to institute suit for the enforcement
of any such payment, and such right shall not be impaired without the consent of
such Holder.

SECTION 6.9.               Restoration of Rights and Remedies.

         If the Trustee or any Debentureholder 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 Debentureholder, then and in every such case the Company,
the Trustee and the Debentureholders shall, subject to any determination in such
proceeding, be restored severally and respectively to their former positions

                                       39
<PAGE>

hereunder, and thereafter all rights and remedies of the Trustee and the
Debentureholders shall continue as though no such proceeding had been
instituted.

SECTION 6.10.     Rights and Remedies Cumulative.

         Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Debentures in the last paragraph of
Section 3.6, no right or remedy herein conferred upon or reserved to the Trustee
or to the Debentureholders 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.

SECTION 6.11.     Delay or Omission Not A Waiver.

         No delay or omission of the Trustee or of any Holder of any Debenture
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 Debentureholders may be exercised from time to time,
and as often as may be deemed expedient, by the Trustee or by the
Debentureholders, as the case may be.

SECTION 6.12.     Control by Debentureholders.

         The Holders of a majority in principal amount of the Outstanding
Debentures 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, 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.

SECTION 6.13.     Waiver of Past Defaults.

         The Holders of a majority in principal amount of the Outstanding
Debentures may, on behalf of the Holders of all the Debentures, waive any past
default hereunder and its consequences, except a default:

                  (1)      in the payment of the principal of or interest on any
         Debenture, or

                                       40
<PAGE>

                  (2)      in respect of a covenant or provision hereof which
         under Article Eight cannot be modified or amended without the consent
         of the Holders of each Outstanding Debenture 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.

SECTION 6.14.     Undertaking for Costs.

         All parties to this Indenture agree, and each Holder of any Debenture
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any negligent
action taken or negligent failure to act as Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Debentureholder, or group of
Debentureholders, holding in the aggregate more than ten percent (10%) in
principal amount of the Outstanding Debentures, or to any suit instituted by any
Debentureholder for the enforcement of the payment of the principal of, or
interest on, any Debenture on or after the Stated Maturity expressed in such
Debenture.

SECTION 6.15.     Waiver of Stay or Extension Laws.

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

                                   ARTICLE VII

                                   The Trustee

SECTION 7.1.               Certain Duties and Responsibilities.

         (a)      Except during the continuance of an Event of Default,

                                       41
<PAGE>

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

                  (2) in the absence of bad faith on its part, the Trustee may
         conclusively rely, as to the truth of the statements and the
         correctness of the opinions expressed therein, upon certificates or
         opinions furnished to the Trustee and conforming to the requirements of
         this Indenture; but in the case of any such certificates or opinions
         which by any provision hereof are specifically required to be furnished
         to the Trustee, the Trustee shall be under a duty to examine the same
         to determine whether or not they conform to the requirements of this
         Indenture.

         (b)      In case an Event of Default has occurred and is continuing,
the Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.

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

                  (1)      this Subsection shall not be construed to limit the
         effect of Subsection (a) of this Section;

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

                  (3)      the Trustee shall not be liable to any Holder or to
         the Company with respect to any action taken or omitted to be taken by
         it in good faith in accordance with the direction of the Holders of not
         less than a majority in principal amount of the Outstanding Debentures
         relating to the time, method and place of conducting any proceeding for
         any remedy available to the Trustee, or exercising any trust or power
         conferred upon the Trustee, under this Indenture; and

                  (4)      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, if it shall have
         reasonable grounds for believing that repayment of such funds or
         adequate indemnity against such risk or liability is not reasonably
         assured to it.

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<PAGE>

         (d)      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.

SECTION 7.2.               Notice of Defaults.

         Within ninety (90) days after the occurrence of any default hereunder,
the Trustee shall transmit by mail to all Debentureholders, as their names and
addresses appear in the Debenture Register, notice of such default hereunder
known to the Trustee, unless such default shall have been cured or waived;
provided, however, that, except in the case of any default of the character
specified in Section 6.1(1) or (2), the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee or a trust committee of directors or Responsible Officers of the
Trustee in good faith determine that the withholding of such notice is in the
interests of the Debentureholders; and provided, further, that in the case of
any default of the character specified in Section 6.1(3), no such notice to
Debentureholders shall be given until at least sixty (60) days after the
occurrence thereof. For the purpose of this Section, "default" means any event
which is, or after notice or lapse of time or both would become, an Event of
Default.

SECTION 7.3.               Certain Rights of Trustee.

         Except as otherwise provided in Section 7.1:

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

                  (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 and the written
         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

                                       43
<PAGE>

         Debentureholders pursuant to this Indenture, unless such
         Debentureholders shall have offered to the Trustee reasonable security
         or indemnity 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 or other paper or document
         but the Trustee, in its discretion, may make such further inquiry or
         investigation into such facts or matters as it may see fit, and, if the
         Trustee shall determine to make such further inquiry or investigation,
         it shall be entitled to examine the books, records and premises of the
         Company, personally or by agent or attorney;

                  (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; and

                  (8)      except with respect to Section 4.1 herein, the
         Trustee shall have no duty to inquire as to the performance of the
         Company's covenants in Article Four. In addition, the Trustee shall not
         be deemed to have knowledge of any Event of Default except (i) any
         Event of Default occurring pursuant to Sections 6.1(1) and 6.1(2) or
         (ii) any Event of Default of which the Trustee shall have received
         written notification or obtained actual knowledge.

SECTION 7.4.               Not Responsible for Recitals or Issuance of
                           Debentures.

         The recitals contained herein and in the Debentures, except the
certificates of authentication, shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for their correctness. The Trustee
makes no representations as to the validity or sufficiency of this Indenture or
of the Debentures, or with respect to any disclosure or offering materials used
in the sale of the Debentures. The Trustee shall not be accountable for the use
or application by the Company of Debentures or the proceeds thereof.

SECTION 7.5.               May Hold Debentures.

         The Trustee, any Paying Agent, Debenture Registrar or any other agent
of the Company, in its individual or any other capacity, may become the owner or
pledgee of Debentures and, subject to Sections 7.8 and 7.12, if operative, may
otherwise deal with the Company with the same rights it would have if it were
not Trustee, Paying Agent, Debenture Registrar or such other agent.

SECTION 7.6.               Money Held in Trust.

         Money held by the Trustee in trust hereunder shall be held in a
separate interest-bearing account and invested as directed by the Company, and
such funds shall at all times be segregated

                                       44
<PAGE>

from all other funds and assets owned or held by the Trustee. Any interest on
any money received by the Trustee hereunder shall be for the benefit of the
Company and shall be paid to the Company upon Company Request.

SECTION 7.7.               Compensation and Reimbursement.

         The Company agrees:

                  (1)      to pay to the Trustee 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
         as may be attributable to its negligence or bad faith; and

                  (3)      to indemnify the Trustee for, and to hold it harmless
         against, any loss, liability or expense incurred without negligence or
         bad faith on its part, arising out of or in connection with the
         acceptance or administration of this trust, 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.

Subject to the provisions of Section 7.12, the Trustee shall have a first
charge, prior in right to the Holders, against any funds held by it, or
otherwise coming into its hands, following an Event of Default.

SECTION 7.8.               Corporate Trustee Required; Eligibility;
                           Disqualification.

         There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America or of any State or Territory or of the District of Columbia or a
corporation or other person permitted to act as Trustee by the Commission,
authorized under such laws to exercise corporate trust powers, having a combined
capital and surplus of at least $25,000,000, and subject to supervision or
examination by Federal or State, Territorial or District of Columbia authority.
If such corporation publishes reports of condition at least annually, pursuant
to law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
Neither the Company nor any of its Affiliates shall serve as Trustee hereunder.
The Trustee shall be subject to the provisions of Section 310(b) of the Trust
Indenture Act. This Indenture shall always have a Trustee who satisfies the
requirements of Section 310(a)(1) of the Trust Indenture Act.

                                       45
<PAGE>

         If at any time the Trustee 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. SECTION 7.9.
Resignation and Removal; Appointment of Successor.

         (a)      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 under Section 7.10.

         (b)      The Trustee may resign at any time by giving written notice
thereof to the Company. If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Trustee within thirty (30) days after the
giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.

         (c)      The Trustee may be removed at any time by Act of the Holders
of a majority in principal amount of the Outstanding Debentures, delivered to
the Trustee and to the Company.

         (d)      If at any time:

                  (1)      the Trustee shall fail to comply with the provisions
         of Section 310(b) of the Trust Indenture Act after written request
         therefor by the Company or by any Debentureholder who has been a bona
         fide Holder of a Debenture or Debentures for at least six (6) months;
         or

                  (2)      the Trustee shall cease to be eligible under Section
         310(a) of the Trust Indenture Act and shall fail to resign after
         written request therefor by the Company or by any such Debentureholder;
         or

                  (3)      the Trustee shall become incapable of acting, or
         shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee
         or of its property shall be appointed, or any public officer shall take
         charge or control of the Trustee or of its property or affairs for the
         purpose of rehabilitation, conservation or liquidation,

then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee and appoint a successor trustee, or (ii) subject to the provisions of
Section 6.14, any Debentureholder who has been a bona fide Holder of a Debenture
for at least six (6) months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor trustee.

         (e)      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, the
Company, by a Board Resolution, shall promptly appoint a successor Trustee. If,
within one (1) year after such resignation, removal

                                       46
<PAGE>

or incapability, or the occurrence of such vacancy, a successor Trustee shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Debentures delivered to the Company and the retiring Trustee, the
successor Trustee so appointed shall, forthwith upon its acceptance of such
appointment, become successor Trustee and supersede the successor Trustee
appointed by the Company. If no successor Trustee shall have been so appointed
by the Company or the Debentureholders and accepted appointment in the manner
hereinafter provided, any Debentureholder who has been a bona fide Holder of a
Debenture for at least six (6) months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee.

         (f)      The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee by mailing
written notice of such event by first-class mail, postage prepaid, to the
Holders of Debentures as their names and addresses appear in the Debenture
Register. Each notice shall indicate the name of the successor Trustee and the
address of its Principal Corporate Trust Office.

SECTION 7.10.     Acceptance of Appointment by Successor.

         Every successor Trustee appointed hereunder shall execute, acknowledge
and deliver to the Company and to the retiring Trustee an instrument accepting
such appointment, and thereupon the registration 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 request of the Company 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, subject nevertheless to its lien, if any,
provided for in Section 7.7. Upon request of any such successor Trustee, the
Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Trustee all of such rights, power
and trusts.

         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.

SECTION 7.11.     Merger, Conversion, Consolidation or Succession to Business of
                  Trustee.

         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 of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided 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 case any Debentures 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

                                       47
<PAGE>

authentication and deliver the Debentures so authenticated with the same effect
as if the successor Trustee had itself authenticated such Debentures.

SECTION 7.12.     Preferential Collection of Claims against Company.

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

                                  ARTICLE VIII

                             Supplemental Indentures

SECTION 8.1.               Supplemental Indentures Without Consent of
                           Debentureholders.

         Without the consent of the Holders of any Debentures, the Company, when
authorized by a Board Resolution, 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 corporation to
         the Company, and the assumption by any such successor of the covenants
         of the Company herein and in the Debentures contained; or

                  (2)      to add to the covenants of the Company, for the
         benefit of the Holders of the Debentures, or to surrender any right or
         power herein conferred upon the Company; or

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

                  (4)      to convey, transfer, assign, mortgage or pledge to or
         with the Trustee any property or assets which the Company may desire to
         convey, transfer, assign, mortgage or pledge; 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 Debentures in bearer form, registrable or not
         registrable as to principal, and with or without interest coupons.

         The Trustee is hereby authorized to join with the Company in the
execution of any such supplemental indenture, to make any further appropriate
agreements and stipulations which may be therein contained and to accept the
conveyance, transfer, assignment, mortgage or pledge of any

                                       48
<PAGE>

property thereunder, but the Trustee shall not be obligated to, but may in its
discretion, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.

         Any supplemental indenture authorized by the provisions of this Section
8.1 may be executed by the Company and the Trustee without the consent of the
Holders of any of the Debentures at the time Outstanding, notwithstanding any of
the provisions of Section 8.2.

SECTION 8.2.               Supplemental Indentures With Consent of
                           Debentureholders.

         With the consent of the Holders of not less than sixty-six and two
thirds percent (662/3%) in principal amount of the Outstanding Debentures, by
Act of said Holders delivered to the Company and the Trustee, the Company, when
authorized by a Board Resolution, and the Trustee may amend this Indenture or
the Debentures and 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 the Debentures under this Indenture; provided, however, that
no such amendment or supplemental indenture shall, without the consent of the
Holders of each Outstanding Debenture affected thereby:

                  (1)      change the Stated Maturity of the principal of, or
         interest on, any Debenture, or reduce the principal amount thereof, the
         rate of interest or premium, if any, thereon or change any Place of
         Payment where, or the coin or currency in which, any Debentures or the
         interest or premium, if any, 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

                  (2)      except as otherwise permitted or contemplated in
         Article Thirteen, increase the Conversion Price of any Debenture; or

                  (3)      make any change in Section 6.8; or

                  (4)      reduce the percentage in principal amount of the
         Outstanding Debentures, 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

                  (5)      modify any of the provisions of this Section or
         Section 6.13, 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 Debenture affected thereby.

                                       49
<PAGE>

         It shall not be necessary for any Act of Debentureholders 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.

SECTION 8.3.               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 shall be entitled to receive,
and (subject to Section 7.1) 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.

SECTION 8.4.               Effect of Supplemental Indentures.

         Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and the respective
rights, limitations of rights, obligations, duties and immunities under this
Indenture of the Trustee, the Company and the Holders of Debentures shall
thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and such supplemental indenture
shall form a part of this Indenture for any and all purposes; and every Holder
of Debentures theretofore or thereafter authenticated and delivered thereunder
shall be bound thereby.

SECTION 8.5.               Conformity with Trust Indenture Act.

         Every supplemental indenture executed pursuant to this Article shall be
prepared as if subject to the requirements of the TIA as then in effect.

SECTION 8.6.               Reference in Debentures to Supplemental Indentures.

         Debentures 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 shall so determine,
new Debentures so modified as to conform, in the opinion of the Trustee and the
Board of Directors, to any such supplemental indenture, may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Debentures.

SECTION 8.7.               Subordination Unimpaired.

         No supplemental indenture executed pursuant to this Article shall
affect the superior position of the holders of Senior Indebtedness with respect
to such Debentures.

                                   ARTICLE IX

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<PAGE>

              Consolidation, Merger, Conveyance, Transfer or Lease

SECTION 9.1.               Company May Consolidate, etc., Only on Certain Terms.

         The Company shall not consolidate with or merge into any other
corporation or convey or transfer its property and assets substantially as an
entirety to any Person, unless:

                  (1)      the corporation formed by such consolidation or into
         which the Company is merged or the Person which acquires by conveyance
         or transfer the properties and assets of the Company substantially as
         an entirety shall be a corporation organized and existing under the
         laws of the United States of America or any State or the District of
         Columbia, and shall expressly assume, by an indenture supplemental
         hereto, executed and delivered to the Trustee, in form satisfactory to
         the Trustee, the due and punctual payment of the principal of and
         interest on all the Debentures and the performance of every covenant of
         this Indenture on the part of the Company to be performed or observed;

                  (2)      immediately after giving effect to such transaction,
         no Event of Default, and no event which, after notice or lapse of time
         or both, would become an Event of Default, shall have happened and be
         continuing; and

                  (3)      the Company shall have delivered to the Trustee an
         Officers' Certificate stating that such consolidation, merger,
         conveyance or transfer and such supplemental indenture comply with this
         Article and that all conditions precedent herein provided for relating
         to such transaction have been complied with.

SECTION 9.2.               Successor Corporation Substituted.

         Upon any consolidation or merger of the Company into another entity, or
any conveyance or transfer of the properties and assets of the Company
substantially as an entirety in accordance with Section 9.1, the successor
corporation formed by such consolidation or into which the Company is merged or
to which such conveyance or transfer is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor corporation had been
named as the Company herein.

SECTION 9.3.               Limitation on Lease of Properties as Entirety.

         The Company shall not lease its properties and assets substantially as
an entirety to any Person.

                                    ARTICLE X

                     Satisfaction, Discharge and Defeasance

                                       51
<PAGE>

SECTION 10.1.     Satisfaction and Discharge of Indenture.

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

                  (1)      either:

                           (a)      all Debentures theretofore authenticated and
         delivered (other than (i) Debentures which have been destroyed, lost or
         stolen and which have been replaced or paid as provided in Section 3.6
         and (ii) Debentures 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 4.3) have been delivered to the Trustee cancelled
         or for cancellation at any time after the Distribution Date; or

                           (b)      all such Debentures not theretofore
         delivered to the Trustee cancelled or for cancellation

                                    (i)     have become due and payable, or

                                    (ii)    will become due and payable at their
                                            Stated Maturity within one (1) year,

and the Company, in the case of (i) or (ii) above, has deposited or caused to be
deposited with the Trustee, as trust funds in trust for the purpose, an amount
in money or noncallable U.S. Government Obligations sufficient to pay and
discharge the entire indebtedness on such Debentures not theretofore delivered
to the Trustee cancelled or for cancellation, for principal and interest to the
date of such deposit (in the case of Debentures which have become due and
payable) or to the date of redemption or the Stated Maturity;

                  (2)      the Company has paid or caused to be paid all other
         sums payable hereunder by the Company; 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.

However, the obligations in Article Thirteen shall survive until the Debentures
are no longer outstanding. Thereafter, notwithstanding the satisfaction and
discharge of this Indenture, the obligations of the Company to the Trustee under
Section 7.7 shall survive.

SECTION 10.2.     Application of Trust Money.

                                       52
<PAGE>

         All money deposited with the Trustee pursuant to Section 10.1 shall be
held in trust and applied by it, in accordance with the provisions of the
Debentures 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
interest for whose payment such money has been deposited with the Trustee. Money
held by the Trustee in trust hereunder shall be held in a separate interest
bearing account and such funds shall at all times be segregated from all other
funds and assets owned or held by the Trustee. Any interest on any money
received by the Trustee hereunder shall be for the benefit of the Company and
shall be paid to the Company on Company Request.

         Any money deposited with the Trustee in trust for the payment of the
principal of and interest on any Debenture pursuant to Section 10.1 and
remaining unclaimed for two (2) years after such principal or interest has
become due and payable, shall be paid to the Company on Company Request; and the
Holder of such Debenture shall thereafter, as an unsecured general creditor,
look to the Company for payment thereof, and all liability of the Trustee with
respect to such trust money and any interest accrued thereon shall thereupon
cease; provided, however, that the Trustee, before being required to make any
such repayment, may at the expense of the Company cause to be published once, in
an Authorized Newspaper in the Place of Payment, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than
thirty (30) days from the date of such publication, any unclaimed balance of
such money then remaining will be repaid to the Company.

         The Trustee shall promptly pay to the Company upon Company Request any
excess money or securities held by it at any time.

SECTION 10.3.     Satisfaction, Discharge and Defeasance of Debentures.

         (a)      The Company will be deemed to have been Discharged (as defined
below) from its obligations with respect to the Debentures; or

         (b)      The Company will cease to be under any obligation to comply
with any term, provision or condition set forth in (i) Article Nine or (ii) the
terms, provisions or conditions of the Debentures (provided, however, that the
Company may not cease to comply with any obligations as to which it may not be
Discharged pursuant to the definition of "Discharged"), if, in the case of (a)
and (b), with respect to the Debentures on the 91st day after the applicable
conditions set forth below in (x) and (y) have been satisfied:

                           (x)(1) the Company has paid or caused to be paid all
         other sums payable with respect to the Outstanding Debentures (in
         addition to any required under (y)); and

                              (2)  the Company has delivered to the Trustee an
         Officers' Certificate stating that all conditions precedent herein
         provided for relating to the satisfaction and

                                       53
<PAGE>

         discharge of the entire indebtedness on all Outstanding Debentures have
         been complied with;

                           (y)(l) the Company shall have deposited or caused to
         be deposited irrevocably with the Trustee as a trust fund specifically
         pledged as security for, and dedicated solely to, the benefit of the
         Holders of the Debentures (i) an amount in the coin or currency of the
         United States of America as at the time of such deposit is legal tender
         for the payment of public and private debts or (ii) non-callable U.S.
         Government Obligations which through the payment of interest and
         principal in respect thereof in accordance with their terms will
         provide, not later than the due date of any payment of principal and
         interest under the Debentures, money in an amount or (iii) a
         combination of (i) and (ii) sufficient (in the opinion with respect to
         (ii) and (iii) of a nationally recognized firm of independent public
         accountants expressed in a written certification thereof delivered to
         the Trustee) to pay and discharge each installment of principal of, and
         interest on, the outstanding Debentures on the dates such installments
         of interest or principal are due;

                              (2)(i) no Event of Default or event (including
         such deposit) which with notice or lapse of time or both would become
         an Event of Default shall have occurred and be continuing on the date
         of such deposit, (ii) no Event of Default as defined in clause (4) or
         (5) of Section 6.1, or event which with notice or lapse of time or both
         would become an Event of Default under either such clause, shall have
         occurred within ninety (90) days after the date of such deposit and
         (iii) such deposit and the related intended consequence under (a) or
         (b) will not result in any default or event of default under any
         material indenture, agreement or other instrument binding upon the
         Company or any Subsidiary or any of their properties; and

                              (3)  the Company shall have delivered to the
         Trustee an Opinion of Counsel to the effect that Holders of the
         Debentures will not recognize income, gain or loss for Federal income
         tax purposes as a result of the Company's exercise of its option under
         this Section 10.3 and will be subject to Federal income tax in the same
         amount, in the same manner and at the same times as would have been the
         case if such option had not been exercised.

                  Any deposits with the Trustee referred to in clause (y)(1)
above will be made under the terms of an escrow trust agreement in form and
substance satisfactory to the Trustee and the Company.

                  "Discharged" means that the Company will be deemed to have
paid and discharged the entire indebtedness represented by, and obligations
under, the Debentures and to have satisfied all the obligations under this
Indenture relating to the Debentures (and the Trustee, at the expense of the
Company, will execute proper instruments acknowledging the same), except (A) the
rights of Holders thereof to receive, from the trust fund described in clause
(y)(1) above, payments of the principal of and the interest on the Debentures
when such payments are due, (B) the Company's obligations with respect to the
Debentures under Sections 3.5, 3.6., 10.2, 4.2, 4.3 (penultimate

                                       54
<PAGE>

paragraph only) and Article Thirteen and the Company's obligations to the
Trustee under Sections 7.7 and 7.9, and (C) the rights, powers, trusts, duties
and immunities of the Trustee hereunder, will survive such discharge. The
Company will reimburse the trust fund for any loss suffered by it as a result of
any tax, fee or other charge imposed on or assessed against deposited U.S.
Government Obligations or any principal, premium or interest paid on such U.S.
Government Obligations, and, subject to the provisions of Section 7.7, will
indemnify the Trustee against any claims made against the Trustee in connection
with any such loss.

                                   ARTICLE XI

                      Ranking; Subordination of Debentures

SECTION 11.1.     Ranking; Subordination.

         The indebtedness evidenced by the Debentures is senior in right of
payment to the Junior Debt. The Company covenants and agrees, and each Holder of
Debentures, by his acceptance thereof, likewise covenants and agrees, that the
indebtedness represented by the Debentures and the payment of the principal of,
interest and premium, if any, on each and all of the Debentures is expressly
subordinated, to the extent and in the manner hereinafter set forth, in right of
payment to the prior payment in full of all Senior Indebtedness, and that the
subordination is for the benefit of the holder of Senior Indebtedness.

SECTION 11.2.     Distribution of Assets, etc.

         No payment on account of principal of or interest on the Debentures
shall be made, and no Debentures shall be purchased or otherwise acquired, and
no funds shall be set aside for the purchase of any Debentures, either directly
or indirectly, by the Company, if a default in the payment of the principal of
or premium, if any, or interest on any Senior Indebtedness shall have occurred
and continued beyond any applicable period of grace so as to entitle the holder
of such Senior Indebtedness to accelerate its maturity, unless and until such
default shall have been cured or waived or shall have ceased to exist or moneys
for the payment thereof shall have been duly set aside.

         In the event of any distribution of assets of the Company upon any
dissolution, winding up, total or partial liquidation, or reorganization of the
Company, whether in bankruptcy, insolvency or receivership proceedings, or upon
any assignment for the benefit of creditors or any other marshalling of the
assets and liabilities of the Company, or otherwise,

                  (1)      all of the principal of and premium, if any, and
         interest on all Senior Indebtedness shall first be paid in full or
         moneys for the full payment thereof shall have been duly set aside
         before any payment is made upon the principal of or interest on any
         Debenture, and

                                       55
<PAGE>

                  (2)      any payment or distribution of assets or securities
         of the Company of any kind or character, whether in cash, property or
         securities (other than securities of the Company as reorganized or
         readjusted, or securities of the Company or of any other corporation
         provided for by a plan of reorganization or readjustment, the payment
         of which is subordinated to the payment of all principal of and
         premium, if any, and interest on such Senior Indebtedness as may at the
         time be outstanding and to any securities issued in respect thereof
         under any such plan of reorganization or readjustment, provided that
         the obligations represented by all notes or other evidences of Senior
         Indebtedness are assumed by the new corporation, if any, resulting from
         any such reorganization or readjustment and provided further that the
         rights of the holders of Senior Indebtedness are not, without the
         consent of such holders, altered by such reorganization or
         readjustment), to which the Debentureholders would be entitled except
         for the provisions of this Article, shall be paid by the liquidating
         trustee or agent or other Person making such payment or distribution,
         whether a trustee in bankruptcy, a receiver or liquidating trustee or
         otherwise, to the holders of Senior Indebtedness (pro rata to each such
         holder on the basis of the respective amounts of Senior Indebtedness
         held by such holder) or their representatives, to the extent necessary
         to pay the principal of and premium, if any, and interest on all Senior
         Indebtedness in full, after giving effect to any concurrent payment or
         distribution to the holders of Senior Indebtedness, before any payment
         or distribution is made to the Debentureholders or to the Trustee.

         If the payment of principal of and any interest on the Debentures is
accelerated because of an Event of Default, no payment on account of principal
of or interest on the Debentures shall be made until all of the principal of and
premium, if any, and interest on all Senior Indebtedness has been paid in full
or due provision has been made for such payment.

         In the event that, notwithstanding the foregoing, any payment or
distribution of any character or any security, whether in cash, securities or
other property (other than securities of the Company as reorganized or
readjusted, or securities of the Company or of any other corporation provided
for by a plan of reorganization or readjustment, the payment of which is
subordinated to the payment of all principal of and premium, if any, and
interest on such Senior Indebtedness as may at the time be outstanding and to
any securities issued in respect thereof under any such plan of reorganization
or readjustment provided that the obligations represented by all notes or other
evidences of Senior Indebtedness are assumed by the new corporation, if any,
resulting from any such reorganization or readjustment and provided further that
the rights of the holders of Senior Indebtedness are not, without the consent of
such holders, altered by such reorganization or readjustment), shall be received
by the Trustee or any Holder in contravention of any of the terms hereof, such
payment or distribution or security shall be received in trust for the benefit
of, and shall be paid over or delivered and transferred to, the holders of the
Senior Indebtedness at the time outstanding in accordance with priorities then
existing among such holders for application to the payment of all Senior
Indebtedness remaining unpaid, to the extent necessary to pay all such Senior
Indebtedness in full. In the event of the failure of the Trustees or any Holder
to endorse or assign any such payment, distribution or security, each holder of
Senior Indebtedness is hereby irrevocably authorized to endorse or assign the
same.

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<PAGE>

SECTION 11.3.     Subrogation.

         Subject to the payment in full of all Senior Indebtedness, the
Debentureholders shall be subrogated (equally and ratably with the holders of
all other indebtedness of the Company which, by its express terms, ranks on a
parity with the Debentures and is entitled to like rights of subrogation) to the
rights of the holders of Senior Indebtedness to receive payments or
distributions of cash, property or securities of the Company applicable to the
Senior Indebtedness until all amounts owing on the Debentures shall be paid in
full, and, as between the Company, its creditors other than holders of Senior
Indebtedness, and the Debentureholders, no such payment or distribution made to
the holders of Senior Indebtedness by virtue of this Article which otherwise
would have been made to the Debentureholders, shall be deemed to be a payment by
the Company on account of the Senior Indebtedness, it being understood that the
provisions of this Article are and are intended solely for the purpose of
defining the relative rights of the Debentureholders, on the one hand, and the
holders of the Senior Indebtedness, on the other hand.

SECTION 11.4.     Obligation of the Company Unconditional.

         Nothing contained in this Article or elsewhere in this Indenture or in
the Debentures is intended to or shall impair, as between the Company, its
creditors other than the holders of Senior Indebtedness, and the
Debentureholders, the obligation of the Company, which is absolute and
unconditional, to pay to the Debentureholders the principal of and interest on
the Debentures as and when the same shall become due and payable in accordance
with their terms, or affect the relative rights of the Debentureholders and
creditors of the Company other than the holders of Senior Indebtedness, nor
shall anything herein or therein prevent the Trustee or any Debentureholder from
exercising all remedies otherwise permitted by applicable law upon an Event of
Default under this Indenture, subject to the rights, if any, under this Article
of the holders of Senior Indebtedness in respect of cash, property or securities
of the Company received upon the exercise of any such remedy.

         Upon any payment or distribution of assets of the Company referred to
in this Article, the Trustee and the Debentureholders shall be entitled to rely
upon any order or decree made by any court of competent jurisdiction in which
any such dissolution, winding up, liquidation or reorganization proceeding
affecting the affairs of the Company is pending and the Trustee, subject to the
provisions of Section 7.1, and the Debentureholders shall be entitled to rely
upon a certificate of the liquidating trustee or agent or other person making
any payment or distribution to the Trustee or to the Debentureholders for the
purpose of ascertaining the persons entitled to participate in such payment or
distribution, the holders of Senior Indebtedness and other indebtedness of the
Company, the amount thereof or payable thereon, the amount paid or distributed
thereon, and all other facts pertinent thereto or to this Article.

SECTION 11.5.     Payments on Debentures Permitted.

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<PAGE>

         Nothing contained in this Article or elsewhere in this Indenture or in
any of the Debentures shall affect the obligation of the Company to make, or
prevent the Company from making, payment of the principal of or interest on the
Debentures in accordance with the provisions hereof, except as otherwise
provided in this Article.

SECTION 11.6.     Effectuation of Subordination by Trustee.

         Each Holder of Debentures, by his acceptance thereof, authorizes and
directs the Trustee on his behalf to take such action at the request of the
Company 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.

SECTION 11.7.     Knowledge of Trustee.

         Notwithstanding the provisions of this Article or any other provisions
of this Indenture, but subject to the provisions of Section 7.1, the Trustee
shall not be charged with knowledge of the existence of any facts which would
prohibit the making of any payment of moneys to or by the Trustee, or the taking
of any other action by the Trustee under this Article Eleven, unless and until
the Trustee shall have received written notice thereof, in the manner required
by Section 1.5, from the Company, any Debentureholder, any Paying Agent, any
Debenture Registrar, or the holder or representative of any class of Senior
Indebtedness.

SECTION 11.8.     Trustee May Hold Senior Indebtedness.

         The Trustee shall be entitled to all the rights set forth in this
Article with respect to any Senior Indebtedness at the time held by it, to the
same extent as any other holder of Senior Indebtedness, and nothing in Section
7.12 or elsewhere in this Indenture shall deprive the Trustee of any of its
rights as such holder.

SECTION 11.9.     Rights of Holders of Senior Indebtedness Not Impaired.

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

SECTION 11.10.    Alteration of Senior Indebtedness.

         The Holders of any Senior Indebtedness may extend, renew, modify or
amend the terms of such Senior Indebtedness or any security therefor and may
release, sell or exchange such security and otherwise deal freely with the
Company, all without notice to or consent of the Debentureholders and without
affecting the liabilities and obligations of the Company, the Trustee or the
Debentureholders under this Indenture or the Debentures.

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<PAGE>

SECTION 11.11.    Article Applicable to Paying Agents.

         In case at any time any Paying Agent other than the Trustee shall have
been appointed by the Company and be then acting hereunder, the term "Trustee"
as used in this Article shall in such case (unless the context shall otherwise
require) 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 Sections 11.7, 11.8, and 11.10 shall not apply to the Company if it acts as
Paying Agent.

SECTION 11.12.    Trustee Not Fiduciary for Holders of Senior Indebtedness.

         The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness and shall not be liable to any such holders if
the Trustee shall in good faith mistakenly pay over or distribute to Holders of
Debentures or to the Company or to any other person cash, property or securities
to which any holders of Senior Indebtedness shall be entitled by virtue of this
Article Eleven or otherwise.

                                   ARTICLE XII

                                   Redemption

SECTION 12.1.     Mandatory Redemption.

         The Company shall have no mandatory redemption or sinking fund
obligations with respect to the Debentures.

SECTION 12.2.     Optional Redemption.

         The Company may redeem all or any portion of the Debentures at any time
and from time to time under the circumstances, upon the terms, and at the
redemption prices, set forth in the form of Debenture included in Section 2.3.
Any redemption pursuant to this Section 12.2 shall be made pursuant to the
provisions of Sections 12.3 through 12.8. Notwithstanding the other provisions
hereof, the Company may not redeem all or any portion of the Debentures unless
the Debenture Registration Statement shall have been declared effective, except
under the circumstances contemplated by Section 15.6.

SECTION 12.3.     Notices to Trustee.

         If the Company elects to redeem Debentures pursuant to the optional
redemption provisions of Section 12.2, it shall furnish to the Trustee, at least
thirty-five (35) days but not more than sixty (60) days before a redemption
date, an Officers' Certificate setting forth the redemption date, the principal
amount of Debentures to be redeemed, the redemption price, and that any

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<PAGE>

condition to such redemption set forth in Section 12.2 has been satisfied or
waived, or is inapplicable.

SECTION 12.4.     Selection of Debentures to be Redeemed.

         If less than all of the Debentures are to be redeemed, the Trustee
shall select the Debentures to be redeemed among the Holders of the Debentures
pro rata or in accordance with a method the Trustee considers fair and
appropriate (and in such manner as complies with applicable legal and stock
exchange requirements, if any). In the event of partial redemption by lot, the
particular Debentures to be redeemed shall be selected, unless otherwise
provided herein, not less than thirty (30) nor more than sixty (60) days prior
to the redemption date by the Trustee from the outstanding Debentures not
previously called for redemption.

         The Trustee shall promptly notify the Company in writing of the
Debentures selected for redemption and, in the case of any Debenture selected
for partial redemption, the principal amount thereof to be redeemed. Debentures
and portions of them selected shall be in amounts of $5,000 or whole multiples
of $5,000; except that if all of the Debentures of a Holder are to be redeemed,
the entire outstanding amount of Debentures held by such Holder shall be
redeemed. Except as provided in the preceding sentence, provisions of this
Indenture that apply to Debentures called for redemption also apply to portions
of Debentures called for redemption.

SECTION 12.5.     Notice of Redemption.

         At least thirty (30) days but not more than sixty (60) days before a
redemption date, the Company shall mail a notice of redemption to each Holder
whose Debentures are to be redeemed.

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

                  (1)      the redemption date;

                  (2)      the redemption price;

                  (3)      if any Debenture is being redeemed in part, the
portion of the principal amount of such Debenture to be redeemed and that, after
the redemption date, upon surrender of such Debenture, a new Debenture or
Debentures in principal amount equal to the unredeemed portion will be issued;

                  (4)      the name and address of the Paying Agent;

                  (5)      that Debentures called for redemption must be
surrendered to the Paying Agent to collect the redemption price; and

                  (6)      that interest on Debentures called for redemption
ceases to accrue on and after the redemption date.

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<PAGE>

         At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company shall deliver to the Trustee, at least thirty-five (35) days prior to
the redemption date, an Officers' Certificate requesting that the Trustee give
such notice and setting forth the information to be stated in such notice as
provided in the preceding paragraph.

SECTION 12.6.     Effect of Notice of Redemption.

         Once notice of redemption is mailed, Debentures called for redemption
and not converted into Common Stock pursuant to Article Thirteen become due and
payable on the redemption date at the redemption price.

SECTION 12.7.     Deposit of Redemption Price.

         At least three (3) Business Days (if by check) and one (1) Business Day
(if by wire transfer) prior to the redemption date, the Company shall deposit
with the Trustee or with the Paying Agent money sufficient to pay the redemption
price of and accrued interest on all Debentures to be redeemed on that date. The
Trustee or the Paying Agent shall return to the Company any money not required
for that purpose.

         If the Company complies with the preceding paragraph, interest on the
Debentures to be redeemed will cease to accrue on the applicable redemption
date, whether or not such Debentures are presented for payment. If any Debenture
called for redemption shall not be so paid upon surrender for redemption because
of the failure of the Company to comply with the preceding paragraph, interest
will be paid on the unpaid principal, from the redemption date until such
principal is paid, and on any interest not paid on such unpaid principal, in
each case at the rate provided in the Debentures and in Section 4.1.

SECTION 12.8.     Debentures Redeemed in Part.

         Upon surrender of a Debenture that is redeemed in part, the Company
shall issue and the Trustee shall authenticate for the Holder at the expense of
the Company a new Debenture equal in principal amount to the unredeemed portion
of the Debenture surrendered.

SECTION 12.9.     Repurchasing of Debentures.

         Nothing herein shall prohibit the Company from repurchasing from time
to time all or any portion of the Debentures in the open market or in privately
negotiated transactions.

                                  ARTICLE XIII

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                            Conversion of Debentures

SECTION 13.1.     Conversion Privilege.

         Subject to and upon compliance with the provisions of this Article
Thirteen and the terms of the form of Debenture set forth in Section 2.3, at the
option of the Holder, any Debenture or any portion of the principal amount
thereof which is $1,000 or a whole multiple thereof, may, at any time on or
before April 1, 2011, or in case such Debenture or some portion thereof shall be
called for redemption prior to such date, then, with respect to such Debenture
or portion thereof, until and including, but not after, the close of business on
the third (3rd) business day next preceding the date fixed for such redemption,
be converted at the principal amount thereof into Common Stock at the Conversion
Price in effect at the date of conversion.

SECTION 13.2.     Manner of Exercise of Conversion Privilege.

         To exercise the conversion privilege, the Holder shall surrender such
Debenture to the Debenture Registrar, together with a duly executed conversion
notice in the form provided on the Debenture, and the Debenture shall also be
accompanied by proper assignments thereof to the Company or in blank for
transfer and any requisite Federal and state transfer tax stamps. The Debenture
Registrar will immediately notify the Company of each such conversion election.
Debentures surrendered for conversion during the period from the close of
business on the record date preceding an Interest Payment Date to the opening of
business on such Interest Payment Date shall (unless any such Debenture or the
portion thereof being converted shall have been called for redemption) also be
accompanied by payment in funds in cash or by certified bank cashier's check of
an amount equal to the interest payable on such Interest Payment Date on the
principal amount of such Debenture then being converted. As promptly as
practicable after the surrender of Debenture for conversion, the Company shall
issue and shall deliver to the Debenture Registrar for delivery to such Holder,
or his designee, a certificate or certificates for the number of full shares of
Common Stock issuable upon the conversion of such Debenture or portion thereof
and a check or cash in respect of any fraction of a share of Common Stock
issuable upon such conversion, all as provided in this Section 13.2, together
with a Debenture or Debentures in principal amount equal to the unconverted and
unredeemed portion, if any, of the Debenture so converted. Conversion shall be
deemed to have been effected on the date on which notice (and payment, if
required) shall have been received at the Debenture Registrar's office and such
Debenture shall have been surrendered to the Debenture Registrar, and at that
time the rights of the holder as a Holder shall cease as to that portion of the
Debenture converted, and the person or persons in whose name or names any
certificate or certificates for shares of Common Stock shall be issuable upon
such conversion shall be deemed to have become on said date the holder or
holders of record of the shares represented thereby; provided, however, that in
the event any such conversion occurs on any date when the stock transfer books
of the Company are closed, the person or persons in whose name or names the
certificates for shares of Common Stock are to be issued will be deemed the
record holder or holders thereof for all purposes on the next succeeding day on
which such stock transfer books are open, and the conversion shall be at the
Conversion Price in effect on such next

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<PAGE>

succeeding day on which such transfer books are open. Subject to the foregoing,
no adjustment shall be made for interest accrued on any Debenture that shall be
converted (unless any such Debenture or the portion thereof being converted
shall have been called for redemption) or for dividends on any Common Stock that
shall be issued upon the conversion of such Debenture.

SECTION 13.3.     Cash Adjustment Upon Conversion.

         The Company shall not be required to issue fractions of shares of
Common Stock upon conversion of Debentures. If more than one Debenture shall be
surrendered for conversion at any time by the same holder, the number of full
shares of Common Stock which shall be issuable upon conversion thereof shall be
computed on the basis of the aggregate principal amount of the Debentures so
surrendered. If any fractional interest in a share of Common Stock would be
deliverable upon the conversion of any Debenture or Debentures, the Company
shall make an adjustment therefor in cash equal to the current market value of
such fractional interest computed to the nearest thousandth of a share at the
closing price on the Nasdaq National Market or, if then traded on a national
securities exchange, the closing price on such exchange or the highest bid
quotation on an automated quotation system on the last business day prior to the
date of conversion, or if the Common Stock shall not then be listed on the
Nasdaq National Market or on an exchange or included on an automated quotation
system, as reported by the National Quotation Bureau, Inc. or similar reporting
service.

SECTION 13.4.     Conversion Price.

         The Conversion Price shall be as specified in the form of Debenture set
forth in Section 2.3 or, after adjustment as provided in this Section 13, the
Conversion Price as so adjusted.

SECTION 13.5.     Adjustment of Conversion Price.

         The Conversion Price shall be adjusted from time to time as follows:

                  (a)      In case the Company shall, at any time or from time
         to time while any of the Debentures are outstanding, (i) issue any
         shares of its capital stock as a dividend (or other distribution) on
         its Common Stock; (ii) subdivide its outstanding shares of Common Stock
         into a greater number of shares; (iii) combine its outstanding shares
         of Common Stock into a smaller number of shares, or (iv) issue by
         reclassification of its Common Stock any shares of stock of the
         Company, the Conversion Price in effect immediately prior thereto shall
         be adjusted so that any Debentureholder who thereafter converts his
         Debenture shall be entitled to receive the number of shares of capital
         stock of the Company which he would have owned or have been entitled to
         receive after the happening of any of the events described above, had
         such Debenture been converted immediately prior to the happening of
         such event. Any adjustment made pursuant to this subdivision (a) shall
         become effective, in the case of a dividend, on the payment date
         retroactively to immediately after the opening of business on the day
         following the record date for the determination of shareholders
         entitled to receive such dividend, subject to the provisions of
         subdivision (f)

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<PAGE>

         of this Section 13.5, and shall become effective in the case of a
         subdivision, combination or reclassification immediately after the
         opening of business on the day following the day when such subdivision,
         combination or reclassification, as the case may be, becomes effective.

                  (b)      In case the Company shall, at any time or from time
         to time while any of the Debentures are outstanding, issue rights or
         warrants entitling anyone to subscribe for or purchase shares of Common
         Stock at a price per share less than the then current market price per
         share of Common Stock (as defined in subdivision (d) below) at the
         Measurement Date (as defined below), the Conversion Price in effect
         immediately prior to the issuance of such rights or warrants shall be
         adjusted as follows: the number of shares of Common Stock into which
         each $1,000 principal amount of each authorized $5,000 denomination of
         Debentures was theretofore convertible shall be multiplied by a
         fraction, the numerator of which shall be the number of shares of
         Common Stock outstanding immediately prior to such issuance plus the
         number of additional shares of Common Stock offered for subscription or
         purchase, and the denominator of which shall be the number of shares of
         Common Stock outstanding immediately prior to such issuance plus the
         number of shares which the aggregate offering price of the total number
         of shares so offered would purchase at such current market price; and
         the Conversion Price shall be adjusted by dividing $1,000 by the new
         number of shares into which each $1,000 principal amount of each
         authorized $5,000 denomination of Debentures shall be convertible as
         aforesaid. The term "Measurement Date" shall mean, with respect to
         determining current market price in connection with the issuance of
         rights or warrants to purchase Common Stock, the earlier of (i) the
         date upon which the Company enters into a bona fide and binding
         agreement for the issuance of such rights or warrants and (ii) the
         issuance or grant thereof. Such adjustment shall become effective on
         the date of such issuance, all as determined by the independent
         certified public accountants then regularly auditing the accounts of
         the Company, whose determination shall be conclusive, subject to the
         provisions of subdivision (f) of this Section 13.5.

                  (c)      In case the Company shall, at any time or from time
         to time while any of the Debentures are outstanding, distribute to all
         holders of shares of Common Stock evidences of its indebtedness or
         securities or assets (excluding cash dividends or cash distributions
         payable out of retained earnings, or distributions payable in shares of
         Common Stock) or rights to subscribe for same (excluding those referred
         to in subdivision (b) above), the Conversion Price in effect
         immediately prior to such distribution shall be adjusted as follows:
         the number of shares of Common Stock into which each $1,000 principal
         amount of each authorized $5,000 denomination of Debentures was
         theretofore convertible shall be multiplied by a fraction, the
         numerator of which shall be the current market price per share of
         Common Stock (as defined in subdivision (d) below) on the record date
         for such distribution, and the denominator of which shall be such
         current market price per share of the Common Stock, less the then fair
         market value (as determined by the Board of Directors of the Company,
         whose determination shall be conclusive) of the portion of the assets
         or Securities or evidences of indebtedness so distributed or of such
         subscription

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<PAGE>

         rights applicable to one share of Common Stock; and the Conversion
         Price shall be adjusted by dividing $1,000 by the new number of shares
         into which each $1,000 principal amount of each authorized $5,000
         denomination of Debentures shall be convertible as aforesaid. Such
         adjustment shall become effective on the date of such distribution
         retroactively to immediately after the opening of business on the day
         following the record date for the determination of shareholders
         entitled to receive such distribution, subject to the provisions of
         subdivision (f) of this Section 13.5. For the purposes of this
         subdivision (c), retained earnings shall be computed by adding thereto
         all charges against retained earnings on account of dividends paid in
         shares of Common Stock in respect of which the Conversion Price has
         been adjusted, all as determined by the independent certified public
         accountants then regularly auditing the accounts of the Company, whose
         determination shall be conclusive.

                  (d)      For the purpose of any computation under subdivision
         (b) and (c) above, the current market price per share of Common Stock
         at any date shall be deemed to be the average of the market values of
         the Common Stock for the ten (10) consecutive business days immediately
         preceding the day in question. The market value of the Common Stock for
         each day shall be determined as provided in Section 13.3.

                  (e)      Except as herein otherwise provided, no adjustment in
         the Conversion Price shall be made by reason of the issuance in
         exchange for cash, property or services, of shares of Common Stock, or
         any securities convertible into or exchangeable for shares of Common
         Stock, or carrying the right to purchase any of the foregoing.

                  (f)      If the Company shall take a record of the holders of
         Common Stock for the purpose of entitling them to receive any dividend,
         for any subscription or purchase rights or any distribution and shall,
         thereafter and before the distribution to stockholders of any such
         dividend, subscription or purchase rights or distribution, abandons its
         plan to pay or deliver such dividend, subscription or purchase rights
         or distribution, then no adjustment of the Conversion Price shall be
         required by reason of the taking of such record.

                  (g)      No adjustment in the Conversion Price shall be
         required unless such adjustment would require an increase or decrease
         of at least one percent (1%) in such price; provided, however, that any
         adjustments which by reason of this subdivision (g) are not required to
         be made shall be carried forward and taken into account in any
         subsequent adjustment. All calculations under this Section 13.5 shall
         be made to the nearest cent or to the nearest one-thousandth of a
         share, as the case may be.

                  (h)      Whenever the Conversion Price is adjusted as herein
         provided, the Company shall (i) forthwith place on file at the
         corporate trust office of the Trustee and the Debenture Registrar a
         statement signed by the Chairman of the Board, the President or an
         Executive Vice President of the Company, and by its Chief Financial
         Officer, Treasurer or an Assistant Treasurer showing in detail the
         facts requiring such adjustment and the Conversion Price after such
         adjustment and the statement of the Company's independent

                                       65
<PAGE>

         certified public accountants confirming the Conversion Price after such
         adjustment, and the Trustee and Debenture Registrar shall exhibit the
         same from time to time to any Holder desiring to inspect such
         certificate during normal business hours, and (ii) cause a notice
         stating that such adjustment has been effective and the adjusted
         Conversion Price to be mailed to the Holders of Debentures at their
         last addresses as they shall appear on the books of the Debenture
         Registrar.

SECTION 13.6.     Effect of Reclassifications, Consolidations, Mergers or Sales
                  on Conversion Privileges.

         In case of any reclassification or change of outstanding shares of
Common Stock issuable upon conversion of the Debentures (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), or in case of any consolidation
of the Company with one or more other corporations (other than a consolidation
in which the Company is the continuing corporation and which does not result in
any reclassification or change of outstanding shares of Common Stock issuable
upon conversion of the Debentures), or in case of the merger of the Company into
another corporation, or in case of any sale or conveyance to another corporation
of the property of the Company as an entirety or substantially as an entirety,
the Company, or such successor or purchasing corporation, as the case may be,
shall execute with the Trustee a supplemental indenture which shall be prepared
as if subject to the TIA as then in effect, providing that each Holder shall
have the right to convert their outstanding Debenture into the kind and amount
of shares of stock and other securities and property receivable upon such
reclassification, change, consolidation, merger, sale or conveyance by a holder
of the number of shares of Common Stock into which such Debenture might have
been converted immediately prior to such reclassification, change,
consolidation, merger, sale or conveyance. 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 Thirteen and any
such adjustments which shall be approved by the Board of Directors and set forth
in such supplemental indenture shall be conclusive for all purposes of this
Section 13.6, and the Trustee shall not be under any responsibility to determine
the correctness of any provision contained in such supplemental indenture
relating to either the kind or amount of shares of stock or securities or
property receivable by Debentureholders upon the conversion of their Debentures
after any such reclassification, change, consolidation, merger, sale or
conveyance.

         The above provisions of this Section 13.6 shall similarly apply to
successive reclassifications, changes, consolidations, mergers, sales and
conveyances.

SECTION 13.7.     Taxes on Conversions.

         The issue of stock certificates on conversion of Debentures shall be
made without charge to the converting Debentureholder for any issue tax in
respect of the issue thereof. The Company shall not, however, be required to pay
any tax which may be payable in respect of any transfer involved in the issue
and delivery of shares of Common Stock (or other security) in any name other
than that of the Holder of any Debenture converted, and the Company shall be not
required to issue

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<PAGE>

or deliver any such stock certificate unless and until the person or persons
requesting the issue thereof shall have paid to the Company the amount of such
tax or shall have established to the satisfaction of the Company that such tax
has been paid.

SECTION 13.8.     Company to Reserve Stock.

         The Company shall at all times reserve and keep available out of its
authorized but unissued shares of Common Stock, for the purpose of effecting the
conversion of the Debentures, such number of its duly authorized shares of
Common Stock as shall from time to time be sufficient to effect the conversion
of all outstanding Debentures.

         The Company covenants that all shares of Common Stock which may be
issuable upon conversion of Debentures shall upon issue be fully paid and
non-assessable and free from all taxes, liens and charges with respect to the
issue thereof.

SECTION 13.9.     Disclaimer by Trustee of Responsibility for Certain Matters.

         Neither the Trustee nor any conversion agent shall at any time be under
any duty or responsibility to any Holder to determine whether any facts exist
which may require any adjustment of the Conversion Price, or with respect to the
nature or extent of any such adjustment when made, or with respect to the method
employed, or provided to be employed, herein or in any supplemental indenture in
making such adjustment. Neither the Trustee nor any conversion agent shall 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 Debenture; and neither the
Trustee nor any conversion agent makes any representation with respect thereto.
Neither the Trustee nor any conversion agent shall be responsible for any
failure of the Company to make any cash payment or to issue, register the
transfer of or deliver any shares of Common Stock or stock certificates or other
securities or property upon the surrender of any Debenture for the purpose of
conversion or to comply with any of the covenants of the Company contained in
this Article Thirteen.

SECTION 13.10.    Company to Give Notice of Certain Events.

         In the event that the Company shall:

                  (1)      pay any dividend or make any distribution to the
         holders of Common Stock otherwise than in cash out of its retained
         earnings; or

                  (2)      offer for subscription, pro rata, to the holders of
         Common Stock any additional shares of stock of any class or any other
         right; or

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<PAGE>

                  (3)      effect any reclassification or change of outstanding
         shares of Common Stock issuable upon the conversion of the Debentures
         (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), or any consolidation of the Company with, or merger of
         the Company into, another corporation (other than a consolidation in
         which the Company is the continuing corporation and which does not
         result in any reclassification or change of outstanding shares of
         Common Stock issuable upon conversion of the Debentures), or any sale
         or conveyance to another corporation of the property of the Company as
         an entirety or substantially as an entirety; then, and in any one or
         more of such events, the Company will give a Responsible Officer of the
         Trustee and the Debenture Registrar written notice thereof at least two
         (2) business days prior to (i) the record date fixed with respect to
         any of the events specified in (1) and (2) above, and (ii) the
         effective date of any of the events specified in (3) above; and shall
         mail a copy of such notice to Holders at their last addressees, as they
         appear upon the books of the Debenture Registrar.

                                   ARTICLE XIV

           Immunity of Directors, Officers, Employees and Stockholders

SECTION 14.1.     Exemption from Individual Liability.

         No Affiliate, officer, director, employee or stockholder, as such, of
the Company, or its Subsidiaries, shall have any liability for any obligations
of the Company under the Debenture or this Indenture, or for any claim based on,
in respect of or by reason of such obligations or their creation. Each
Debentureholder by accepting a Debenture hereby expressly waives and releases
all such liability. The waiver and release are part of the consideration for the
issue of the Debentures.

                                   ARTICLE XV

                        Registration Under Securities Act

SECTION 15.1.     Debentures Entitled to Registration.

         The Debentures and the shares of Common Stock issued or issuable upon
conversion of the Debentures shall be entitled to the registration rights set
forth in this Article 15.

SECTION 15.2.     Debenture Registration Statement.

         The Company shall, at its expense, cause a registration statement on
the appropriate form to be filed with the Commission covering the registration
of the Debentures and the shares of Common Stock issued or issuable upon
conversion of the Debentures (the "Debenture Registration Statement") within the
time required by Section 15.3. Upon and after any such filing, the Company shall
take all reasonable steps necessary to promptly cause the Debenture Registration
Statement to be declared effective by the Commission. The Company shall give
prompt written

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notice of the declaration of effectiveness of the Debenture Registration
Statement to each Debentureholder whose securities are included therein, and
thereafter shall supply at its expense such reasonable number of copies of the
applicable prospectus as may be requested in writing by such Debentureholders.
The Trustee shall have no obligation to file the Debenture Registration
Statement.

SECTION 15.3.     Timing of Filing Debenture Registration Statement.

         (a)      Unless the Debenture Registration Statement shall have earlier
been declared effective under the circumstances contemplated by Section 15.3(b),
the Debenture Registration Statement shall be filed with the Commission on the
earlier of the first filing after the date of this Indenture of a registration
statement with the Commission by the Company for any other purpose, or December
31, 2002.

         (b)      Unless the Debenture Registration Statement shall have earlier
been declared effective under either of the two circumstances contemplated by
Section 15.3(a), the Company shall not redeem all or any portion of the
Debentures unless the Debenture Registration Statement shall have been declared
effective or unless Section 15.6 shall be applicable.

SECTION 15.4.     Period of Effectiveness; State Law Requirements.

         Following the effectiveness of the Debenture Registration Statement,
the Company shall use its best efforts to keep it continuously effective and
current until the expiration of one (1) year following the commencement of the
first holding period under the Commission's Rule 144 with respect to the
Debentures and the underlying shares of Common Stock. The Company shall
contemporaneously take at its expense those steps necessary to assist Holders in
their compliance with state securities laws' registration or qualification
requirements that may be applicable to re-sales of the Debentures and such
shares of Common Stock in jurisdictions where the Debentures were originally
offered and sold by the Company.

SECTION 15.5.     Debentureholder to Supply Information.

         Each Holder, by acceptance of a Debenture or the Common Stock issued on
conversion thereof, shall be deemed to have agreed to provide the Company with
all information regarding the Holder, including the nature and amount of
beneficial ownership by the Holder of Debentures and Common Stock, that the
Company may reasonably request to include the Holder's Debentures and related
shares of Common Stock in the Debenture Registration Statement. The request from
the Company shall be sent to each Debentureholder at his address as it appears
on the Debenture Register. The requested information shall be mailed by the
Debentureholders to the Company at its address set forth herein or pursuant
hereto within not more than five (5) Business Days of the Debentureholders'
receipt of the request from the Company.

SECTION 15.6.     Exception to Requirements.

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<PAGE>

         Notwithstanding the other provisions hereof, the Company shall not be
required to file and pursue the effectiveness of the Debenture Registration
Statement if at the applicable time the Company shall reasonably believe the
Debentures and the underlying shares of Common Stock are no longer subject to
restriction on transfer under applicable securities laws as a result of the
issuance of those securities in a transaction under Section 4(2) of the
Securities Act or Rule 506 of Regulation D thereunder. In this event, the
Company shall, at its expense, promptly take all reasonable steps necessary to
remove legends from each certificate representing the securities and to remove
all stop transfer instructions that may have been issued to the Debenture
Registrar or any transfer agent for the Common Stock.

*    *    *    *    *    *    *    *    *    *    *    *    *    *    *    *

         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 have caused this Indenture to be duly
executed and attested, all as of the day and year first above written.

Attest:                               REPUBLIC BANCSHARES, INC.

By:      /s/ Christopher M. Hunter    By:   /s/ William R. Falzone
    ------------------------------        ------------------------------------
         Christopher M. Hunter,             William R. Falzone, Vice President
         Corporate Secretary                and Chief Financial Officer

Attest:                               U.S. BANK TRUST, NATIONAL ASSOCIATION

By:      /s/ April Lipscomb           By:    /s/ Mary Willis
    ------------------------------        -------------------------------------
         Authorized Signatory                Mary Willis,
                                             Assistant Vice President

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