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                                                                    Exhibit 4.18

                   GUARANTEED MINIMUM WITHDRAWAL BENEFIT RIDER
                                   SINGLE LIFE
                                SECURESOURCE(SM)

This rider is made a part of the contract to which it is attached. Except where
this rider provides otherwise, it is subject to all of the conditions and
limitations of the contract. THIS RIDER CANNOT BE TERMINATED EITHER BY YOU OR US
PRIOR TO THE CONTRACT'S SETTLEMENT DATE EXCEPT AS PROVIDED IN THE TERMINATION OF
THE RIDER PROVISION.

This rider requires participation in our asset allocation program. There is no
additional charge to participate in this program. Your Initial Asset Allocation
Model is shown under Contract Data. Contracts issued with initial purchase
payments over the Maximum Purchase Payments Permitted (shown under Contract
Data) require corporate officer approval and may require limitation of the
number of models available for selection.

If you selected this Guaranteed Minimum Withdrawal Benefit Rider option, it will
be indicated under Contract Data.

The additional charge for this rider is described below.

Tax-qualified annuities have minimum distribution rules that govern the timing
and amount of distributions from the annuity contract. If you have a
tax-qualified annuity, you may be required to take a minimum distribution that
is greater than your Remaining Benefit Payment (RBP) or your Remaining Annual
Lifetime Payment (RALP) on the most recent rider anniversary. In most
situations, these required minimum distributions will not result in excess
withdrawal processing. However, in limited circumstances, an excess withdrawal
due to a required distribution would be subject to the Guaranteed Benefit Amount
(GBA) excess withdrawal processing, the RBA excess withdrawal processing, and/or
the ALP excess withdrawal processing.

DEFINITIONS

CONTRACT DATE, CONTRACT ANNIVERSARY, RIDER ANNIVERSARY

Your contract date is shown under Contract Data. It is the date from which
contract anniversaries, contract years, and contract months are determined. Your
contract anniversary is the same day and month as the contract date each year
that the contract remains in force. Your rider anniversary is the same as your
contract anniversary unless the rider is issued after the contract date. It is
the same day and month as the rider effective date each year that the rider
remains in force.

RIDER EFFECTIVE DATE

This rider is effective as of the contract date of this contract unless
otherwise provided.

WAITING PERIOD

The Waiting Period, as shown under Contract Data, is the number of years,
starting on the rider effective date, that your ability to utilize both Step-ups
and withdrawals is limited. During the Waiting Period, Step-ups are not
available if a withdrawal is taken. The end of the Waiting Period is the day
prior to the anniversary.

WITHDRAWAL

For purposes of this rider, the term "withdrawal" is equal to the term
"surrender" in your contract and any other riders. A withdrawal is the amount by
which your contract value is reduced as a result of your surrender request. It
may differ from the amount of your request due to any surrender charge.

GUARANTEED BENEFIT AMOUNT (GBA)

The Guaranteed Benefit Amount (GBA) is equal to the total cumulative withdrawals
guaranteed by this rider. The GBA cannot be withdrawn and is not payable as a
death benefit. The GBA is used to calculate the Guaranteed Benefit Payment.

REMAINING BENEFIT AMOUNT (RBA)

As you make withdrawals, they reduce the amount of GBA that is guaranteed by
this rider as future withdrawals. At any point in time, the Remaining Benefit
Amount (RBA) equals the amount of GBA that remains.

GUARANTEED BENEFIT PAYMENT (GBP)

At any time, the Guaranteed Benefit Payment (GBP) is the amount that the rider
guarantees will be available for withdrawal each contract year after the Waiting
Period, until the earlier of the termination of the rider or the RBA is reduced
to zero. During the Waiting Period, the annual withdrawal amount guaranteed by
the rider may be less than the GBP due to the limitations the Waiting Period
imposes on your ability to utilize both Step-ups and withdrawals. The annual
withdrawal amount guaranteed by the rider during the Waiting Period is equal to
the Remaining

139476-SG                                                               (6/2007)

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Benefit Payment at the beginning of the contract year as described below.

REMAINING BENEFIT PAYMENT (RBP)

As you make withdrawals during a contract year, the remaining amount that the
rider guarantees will be available for withdrawal that year is reduced. At any
point in time, the Remaining Benefit Payment (RBP) equals the amount that the
rider guarantees will be available for withdrawal during the remainder of the
current contract year. During the Waiting Period, when the amount that the rider
guarantees to be available for withdrawal may be less than the GBP, the RBP will
be the amount that is actually guaranteed. Withdrawing more than the RBP will
subject the RBA and GBA to the excess withdrawal processing described later in
this rider. When determining if a withdrawal will result in the application of
the RBA and GBA excess withdrawal processing, we use the RBP amount on the date
of (but prior to) the current withdrawal.

COVERED PERSON

The Covered Person is the person whose life is used to determine when the Annual
Lifetime Payment (ALP) is established and the duration of the ALP payments. The
Covered Person is the oldest owner unless otherwise specified under Contract
Data. The Covered Person may change if there is a spousal continuation or a
change of ownership. If the owner is a non-natural person (i.e., a trust or
corporation), the Covered Person is the oldest annuitant.

ANNUAL LIFETIME PAYMENT ATTAINED AGE (ALPAA)

The Annual Lifetime Payment Attained Age (ALPAA), as shown under Contract Data,
is the age at which the lifetime benefit is established.

ANNUAL LIFETIME PAYMENT (ALP)

At any time after the rider effective date, or the rider anniversary following
the date the Covered Person reaches the ALPAA if later, the Annual Lifetime
Payment (ALP) is the amount that the rider guarantees will be available for
withdrawal each contract year after the Waiting Period, until death (see Death
Benefit Before the Settlement Date) or termination of the rider, without the
possibility of reducing the guarantee provided by this rider. During the Waiting
Period, the annual withdrawal amount guaranteed by the rider may be less than
the ALP due to the limitations the Waiting Period imposes on your ability to
utilize both Step-ups and withdrawals. The annual withdrawal amount guaranteed
by the rider during the Waiting Period is equal to the Remaining Annual Lifetime
Payment at the beginning of the contract year as described below.

REMAINING ANNUAL LIFETIME PAYMENT (RALP)

As you make withdrawals during a contract year, the remaining amount that the
rider guarantees will be available for withdrawal that year is reduced. At any
point in time after the establishment of the ALP, the Remaining Annual Lifetime
Payment (RALP) equals the amount that the rider guarantees will be available for
withdrawal during the remainder of the current contract year. During the Waiting
Period, when the amount that the rider guarantees to be available for withdrawal
may be less than the ALP, the RALP will be the amount that is actually
guaranteed. Withdrawing more than the RALP will subject the ALP to the excess
withdrawal processing described later in this rider. When determining if a
withdrawal will result in the application of the ALP excess withdrawal
processing, we use the RALP amount on the date of (but prior to) the current
withdrawal.

STEP-UP DATE

The rider anniversary date if the Annual Step-up is processed automatically (see
"Annual Step-up" below). If not, the valuation date we receive your written
request to Step-up if we receive your request before the close of business on
that day, otherwise the next valuation date.

GUARANTEED MINIMUM WITHDRAWAL BENEFIT

The Guaranteed Minimum Withdrawal Benefit guarantees that regardless of
investment performance you may take withdrawals each contract year until the
earlier of:

     i)   termination of the rider or

     ii)  the later of death (as determined in Death Benefit Before the
          Settlement Date), or the RBA is depleted.

Before the establishment of the ALP, the annual withdrawal amount guaranteed by
the rider is equal to the RBP from the beginning of the contract year.

After the establishment of the ALP, the rider guarantees that you have the
option each contract year to cumulatively withdraw an amount up to the RALP or
the RBP from the beginning of the

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contract year, but the rider does not guarantee withdrawal of both the RALP and
the RBP in a contract year.

After the establishment of the ALP, if you withdraw an amount larger than the
RALP, the ALP may be reduced in accordance with the excess withdrawal processing
as described below (see ALP - When a withdrawal is made).

At any time, as long as your withdrawal does not exceed the greater of the RBP
or the RALP, you will not be assessed a surrender charge. If you withdraw an
amount larger than the greater of the RBP or the RALP, the amount in excess of
the greater of the RBP or the RALP will be assessed any applicable surrender
charges, and the GBA, RBA and ALP may be reduced in accordance with the excess
withdrawal processing as described below. (See GBA and RBA - When a withdrawal
is made. Also, see ALP - When a withdrawal is made.) At any time you may
withdraw any amount up to your entire surrender value, subject to the excess
withdrawal processing under the rider.

Certain values used to compute amounts available for withdrawal under the terms
of this rider can be increased if your contract value has increased at the
specified intervals (see Annual Step-Up). We will modify the charge for this
rider if you elect the Annual Step-up (see Annual Rider Charge) and the then
current charge for the asset allocation model at the time of the Step-up is
higher. If you take withdrawals during the Waiting Period, any previously
applied Annual Step-ups will be reversed and the Annual Step-up will not be
available until the rider anniversary following the Waiting Period. You may take
withdrawals after the end of the Waiting Period without reversal of previously
applied Annual Step-ups.

GUARANTEED BENEFIT AMOUNT (GBA) AND REMAINING BENEFIT AMOUNT (RBA)

Your GBA and RBA are determined at the following times and are subject to a
maximum amount as shown under Contract Data:

1.   AT RIDER EFFECTIVE DATE

     If the rider is effective on the contract date, the GBA and RBA are set
     equal to the initial purchase payment plus any purchase payment credit (if
     applicable).

     If the rider is effective on a contract anniversary date, the GBA and RBA
     are set equal to the contract value on the later of that anniversary and
     the valuation date we receive your written request to add the rider if we
     receive your request before the close of business on that day, otherwise
     the contract value on the next valuation date.

2.   WHEN A SUBSEQUENT PURCHASE PAYMENT IS MADE

     Each additional purchase payment will have its own GBA and RBA established
     equal to the amount of the purchase payment plus any purchase payment
     credit. Upon each subsequent purchase payment:

     (A)  the total RBA is recalculated to equal the sum of the individual RBAs
          immediately prior to the receipt of the additional purchase payment,
          plus the RBA associated with the additional purchase payment.

     (B)  the total GBA is recalculated to equal the sum of the individual GBAs
          immediately prior to the receipt of the additional purchase payment,
          plus the GBA associated with the additional purchase payment.

3.   WHEN A WITHDRAWAL IS MADE ON OR AFTER THE RIDER ANNIVERSARY FOLLOWING THE
     WAITING PERIOD

     Whenever such a withdrawal is made the total GBA and total RBA will be
     equal to the amount in either (A) or (B) as follows:

     (A)  If the current withdrawal is less than or equal to the RBP, the total
          RBA is reduced by the amount of the withdrawal and the total GBA is
          unchanged.

     (B)  If the current withdrawal exceeds the RBP, excess withdrawal
          processing will occur as follows:

          (i)  the total GBA will be reset to the lesser of its current value or
               the contract value immediately following the withdrawal; and

          (ii) the total RBA will be reset to the lesser of its current value
               less the amount of the withdrawal or the contract value
               immediately following the withdrawal.

4.   WHEN A WITHDRAWAL IS MADE DURING THE WAITING PERIOD

     Upon the first such withdrawal, any previously applied Annual Step-ups will
     be reversed. Step-up reversal means that the GBA and RBA associated with
     each purchase payment will be reset to the amount of that

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     purchase payment plus any purchase payment credit. The total GBA and total
     RBA will be recalculated to equal the sum of the individual GBAs and RBAs.
     The GBP will also be recalculated as described below (see Guaranteed
     Benefit Payment). These recalculated values are then used in the following
     calculations.

     Whenever such a withdrawal is made, and after reversal of any previously
     applied Annual Step-ups has been completed, the total GBA and total RBA
     will be equal to the amount in either (A) or (B) as follows:

     (A)  If the current withdrawal is less than or equal to the RBP, the total
          RBA is reduced by the amount of the withdrawal and the total GBA is
          unchanged.

     (B)  If the current withdrawal exceeds the RBP, excess withdrawal
          processing will occur as follows:

          (i)  the total GBA will be reset to the lesser of its current value or
               the contract value immediately following the withdrawal; and

          (ii) the total RBA will be reset to the lesser of its current value
               less the amount of the withdrawal or the contract value
               immediately following the withdrawal.

5.   WHENEVER AN INDIVIDUAL RBA IS DEPLETED

     Whenever an RBA is depleted by a withdrawal, the GBA associated with that
     RBA will also be set to zero.

6.   UPON ANNUAL STEP-UP AS DESCRIBED BELOW.

GUARANTEED BENEFIT PAYMENT (GBP)

At any point in time, the GBP is calculated as follows:

1.   Determine the lesser of (A) or (B) for each purchase payment where:

          (A)  is the individual GBA multiplied by the GBP Percentage shown
               under Contract Data, and

          (B)  is the individual RBA.

2.   Add the results of Step 1 for each purchase payment to obtain the current
     total GBP.

If you withdraw less than the GBP in a contract year, there is no carry over to
the next contract year.

REMAINING BENEFIT PAYMENT (RBP)

At the beginning of each contract year during the Waiting Period and prior to
any withdrawal, the RBP for each purchase payment is set equal to that purchase
payment plus any purchase payment credit multiplied by the GBP Percentage shown
under Contract Data.

At the beginning of any other contract year, each individual RBP is set equal to
each individual GBP.

Each additional purchase payment will have its own RBP established equal to that
payment's GBP. The total RBP is equal to the sum of the individual RBPs.

Whenever a withdrawal is made, the total RBP equals the total RBP immediately
prior to the withdrawal less the amount of the withdrawal, but not less than
zero.

ANNUAL LIFETIME PAYMENT (ALP)

Your ALP is determined at the following times and is subject to a maximum amount
as shown under Contract Data:

1.   INITIAL ESTABLISHMENT

     On the rider effective date, or the rider anniversary following the date
     the Covered Person reaches the ALPAA if later, the ALP is set equal to the
     total RBA multiplied by the ALP Percentage shown under Contract Data.

2.   WHEN A SUBSEQUENT PURCHASE PAYMENT IS MADE

     Each purchase payment made subsequent to the establishment of the ALP
     increases the ALP by the amount of the purchase payment and any purchase
     payment credit multiplied by the ALP percentage shown under Contract Data.

3    WHEN A WITHDRAWAL IS MADE ON OR AFTER THE RIDER ANNIVERSARY FOLLOWING THE
     WAITING PERIOD

     Whenever such a withdrawal is made after the establishment of the ALP, the
     ALP will be equal to the amount in either (A) or (B) as follows:

     (A)  If the current withdrawal is less than or equal to the RALP, the ALP
          is unchanged.

     (B)  If the current withdrawal exceeds the RALP, excess withdrawal
          processing will occur and the ALP will be reset to the lesser of:

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          (i)  the ALP immediately prior to the withdrawal; or

          (ii) the contract value immediately following the withdrawal
               multiplied by the ALP percentage shown under Contract Data.

     If you withdraw less than the ALP in a contract year, there is no carry
     over to the next contract year.

4.   WHEN A WITHDRAWAL IS MADE DURING THE WAITING PERIOD

     If the ALP has been established upon the first such withdrawal, any
     previously applied Annual Step-ups will be reversed. Step-up reversal means
     that the ALP will be reset to equal total purchase payments plus any
     purchase payment credits multiplied by the ALP Percentage shown under
     Contract Data. The recalculated value is then used in the following
     calculations.

     Whenever such a withdrawal is made, and after the reversal of any
     previously applied Annual Step-ups has been completed, the ALP will be
     equal to the amount in either (A) or (B) as follows:

     (A)  If the current withdrawal is less than or equal to the RALP, the ALP
          is unchanged.

     (B)  If the current withdrawal exceeds the RALP, excess withdrawal
          processing will occur and the ALP will be reset to the lesser of:

          (i)  the ALP immediately prior to the withdrawal; or

          (ii) the contract value immediately following the withdrawal
               multiplied by the ALP percentage shown under Contract Data.

5.   UPON ANNUAL STEP-UP AS DESCRIBED BELOW.

6.   UPON SPOUSAL CONTINUATION OR CHANGE OF OWNERSHIP AS DESCRIBED LATER IN THE
     RIDER.

REMAINING ANNUAL LIFETIME PAYMENT (RALP)

The RALP is established at the same time as the ALP.

At the beginning of each contract year during the Waiting Period and prior to
any withdrawal, the RALP is set equal to total purchase payments plus any
purchase payment credits multiplied by the ALP Percentage shown under Contract
Data.

At the beginning of any other contract year, the RALP is set equal to the ALP.

Whenever a subsequent purchase payment is made, the RALP is increased by the
amount of that purchase payment plus any purchase payment credits multiplied by
the ALP Percentage shown under Contract Data.

Whenever a withdrawal is made, the RALP equals the RALP immediately prior to the
withdrawal less the amount of the withdrawal, but not less than zero.

EXCESS WITHDRAWAL PROCESSING

Here is a simplified example of how the Guaranteed Benefit Amount (GBA), the
Remaining Benefit Amount (RBA), the Guaranteed Benefit Payment (GBP), and the
Annual Lifetime Payment (ALP) change when withdrawals exceed the annual limits
and when withdrawals don't exceed the annual limits.

EXAMPLE ASSUMES

-    No withdrawals have ever been made

-    GBA = $100,000

-    RBA = $100,000

-    The contract value before the withdrawal is $70,000

-    Current annual withdrawal limit is $6,000 for the ALP and $7,000 for the
     GBP

$6,000 WITHDRAWAL

     RBA after withdrawal = $94,000 = $100,000 - $6,000

     GBA after withdrawal = $100,000

     ALP after withdrawal = $6,000

     GBP after withdrawal = $7,000

$7,000 WITHDRAWAL

     RBA after withdrawal = $93,000 = $100,000 - $7,000

     GBA after withdrawal = $100,000

     ALP after withdrawal = $3,780 = lesser of ($6,000) or (6% * ($70,000 -
     $7,000))

     GBP after withdrawal = $7,000

$8,000 WITHDRAWAL

     RBA after withdrawal = $62,000 = lesser of ($100,000 - $8,000) or ($70,000
     - $8,000)

     GBA after withdrawal = $62,000 = lesser of ($100,000) or ($70,000 - $8,000)

     ALP after withdrawal = $3,720 = lesser of ($6,000) or (6% * ($70,000 -
     $8,000))

     GBP after withdrawal = $4,340 = 7% * $62,000

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REQUIRED MINIMUM DISTRIBUTIONS

Notwithstanding the excess withdrawal processing provisions above, if you are
taking required minimum distributions ("RMD") from this contract and the RMD is
greater than the RALP or RBP on the most recent rider anniversary, the portion
of the RMD that exceeds the RALP or RBP on the most recent rider anniversary
will not be treated as an excess withdrawal provided:

1.   the RMD is for this contract alone, and

2.   the RMD is based on your recalculated life expectancy taken from the
     Uniform Lifetime Table under the Code, and

3.   the RMD amount is otherwise based on the requirements of the Code Section
     401(a)(9), related Code provisions, and regulations thereunder that were in
     effect on the effective date of this rider.

Withdrawal amounts greater than the RALP or RBP on the most recent rider
anniversary that do not meet these conditions will result in excess withdrawal
processing.

ANNUAL STEP-UP

Beginning with the first rider anniversary, an Annual Step-up may be available.
If you take any withdrawals during the Waiting Period, any previously applied
Annual Step-ups will be reversed and the Annual Step-up will not be available
until the rider anniversary following the Waiting Period.

The Annual Step-up will be effective on the Step-up Date. Only one Annual
Step-up will be allowed each contract year.

Other than the exception described above, the Annual Step-up will be available
as described below.

-    On any rider anniversary where the RBA or, if established, the ALP would
     increase and the annual rider charge would not increase as a result of the
     Annual Step-up, we will execute the Annual Step-up automatically on the
     Step-up Date.

-    If the Annual Step-Up would result in an increase of the annual rider
     charge, we do not execute the Annual Step-Up automatically and you will be
     notified. You then have the option to elect the Annual Step-up, with the
     resulting charge increase, anytime within the 30 days following that rider
     anniversary as long as the contract value is greater than the total RBA or
     the contract value multiplied by the ALP Percentage shown under Contract
     Data is greater than the ALP, if established, on the Step-up Date.

If the Annual Step-up is executed, the total RBA, total GBA, GBP, RBP, ALP, and
RALP will be adjusted as follows:

RBA STEP-UP

Subject to the maximum RBA shown under Contract Data, the total RBA will be
increased to the greater of (A) or (B) where:

     (A)  is the total RBA immediately prior to the Annual Step-up; and

     (B)  is the contract value on the Step-up Date.

GBA STEP-UP

Subject to the maximum GBA shown under Contract Data, the total GBA will be
increased to the greater of (A) or (B) where:

     (A)  is the total GBA immediately prior to the Annual Step-up; and

     (B)  is the contract value on the Step-up Date.

GBP STEP-UP

The GBP will be calculated as described earlier, based on the increased GBA and
RBA.

RBP STEP-UP

Prior to any withdrawals during the Waiting Period, the RBP for each purchase
payment will be calculated as that purchase payment plus any purchase payment
credit multiplied by the GBP Percentage shown under Contract Data. The total RBP
is equal to the sum of the individual RBPs.

At any other time, the RBP will be calculated as the GBP after the Annual
Step-up less all prior withdrawals made during the current contract year, but
will never be less than zero.

ALP STEP-UP

After the establishment of the ALP, subject to the maximum ALP shown under
Contract Data, the ALP will be increased to the greater of (A) and (B) where:

     (A)  is the ALP immediately prior to the Annual Step-up; and

     (B)  is the contract value on the Step-up Date multiplied by the ALP
          Percentage shown under Contract Data.

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RALP STEP-UP

After the establishment of the ALP, and prior to any withdrawals during the
Waiting Period, the RALP will be calculated as total purchase payments plus any
purchase payment credits multiplied by the ALP Percentage shown under Contract
Data.

At any other time after the establishment of the ALP, the RALP will be
calculated as the ALP after the Annual Step-up less all prior withdrawals made
during the current contract year, but will never be less than zero.

ASSET ALLOCATION PROGRAM

This rider requires participation in our asset allocation program. At time of
application you choose an asset allocation model from any available model
ranging from the conservative category to the aggressive category. If your
contract was issued with initial purchase payments over the Maximum Purchase
Payments Permitted (shown under Contract Data) requiring corporate officer
approval, there may be a limitation of the number of models available for
selection.

Because this rider requires that your contract value be invested in one of the
asset allocation models for the life of the contract, and you CANNOT TERMINATE
THIS RIDER ONCE YOU HAVE SELECTED IT, if you later decide you do not want to
participate in any of the asset allocation models, you must terminate your
contract by requesting a full surrender. Surrender charges and tax penalties may
then apply.

You can allocate your contract value to any available asset allocation model (1)
prior to your first withdrawal and (2) following a benefit reset as described
below but prior to any subsequent withdrawal. During these accumulation phases,
you may request to change your asset allocation model to any available asset
allocation model.

Immediately following a withdrawal your contract value will be reallocated to
the Target Model shown under Contract Data if your current asset allocation
model is more aggressive than the Target Model. After you have taken a
withdrawal and prior to any benefit reset as described below, you are in a
withdrawal phase. During withdrawal phases you may request to change your asset
allocation model to the Target Model or any asset allocation model that is more
conservative without a benefit reset as described below.

If you are in a withdrawal phase and you choose to allocate your contract value
to an asset allocation model that is more aggressive than the Target Model, your
rider benefit will be reset as follows:

     (A)  the total GBA will be reset to the lesser of its current value or the
          contract value; and

     (B)  the total RBA will be reset to the lesser of its current value or the
          contract value; and

     (C)  the ALP, if established, will be reset to the lesser of:

          i)   its current value or

          ii)  the contract value multiplied by the ALP Percentage shown under
               Contract Data; and

     (D)  the GBP will be recalculated as described earlier, based on the reset
          GBA and RBA; and

     (E)  the RBP will be recalculated as the reset GBP less all prior
          withdrawals made during the current contract year, but it will never
          be less than zero; and

     (F)  the RALP will be recalculated as the reset ALP less all prior
          withdrawals made during the current contract year, but it will never
          be less than zero.

You may request to change your asset allocation model by written request on an
authorized form or by another method agreed to by us. The number of elective
asset allocation model changes permitted per contract year is shown under
Contract Data. Additionally, we reserve the right to limit the number of model
changes permitted if required to comply with the written instructions of a fund.

We reserve the right to change the Target Model to an asset allocation model
that is more aggressive after 30 days written notice.

We reserve the right to cancel required participation in the asset allocation
program after 30 days written notice. If asset allocation models are not
required, you may allocate your contract value and additional purchase payments
as provided in the contract.

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REMAINING BENEFIT AMOUNT (RBA) PAYOUT OPTION

As an alternative to the annuity payment plans available under the contract, a
fixed payout option is available under this rider.

Under this option, the amount payable each year will be equal to the remaining
schedule of GBPs but the total amount paid over the life of the annuity will not
exceed the total RBA at the time you begin this fixed payout option. These
annualized amounts will be paid in the frequency that you elect. The frequencies
will be among those offered by us at that time but will be no less frequently
than annually. If, at the death of the owner, payments have been made for less
than the total RBA, the remaining payments will be made to the beneficiary.

This option may not be available if the contract is issued to qualify under
Section 403 or 408 of the Code, as amended. For such contracts, this option will
be available only if the number of years it will take to deplete the RBA by
paying the GBP each year is less than the life expectancy of the owner at the
time the option becomes effective. Such life expectancy will be computed using a
life expectancy table published by the IRS.

This payout option may be elected as a settlement option by the beneficiary of
the contract subject to the Payments to Beneficiary section of the contract.
Whenever multiple beneficiaries are designated under the contract, each such
beneficiary's share of the proceeds, if they elect this option, will be in
proportion to their applicable designated beneficiary percentage.

We reserve the right to adjust the remaining schedule of GBPs if necessary to
comply with the Code.

CONTRACT PROVISION MODIFICATIONS

Because of the addition of this rider to your contract, several contract
provisions are modified as described above and as further described below.

PAYMENT LIMITS PROVISION

We may restrict cumulative subsequent purchase payments to $100,000 on a
non-discriminatory basis.

ALLOCATION OF PURCHASE PAYMENTS

Because this rider requires participation in our asset allocation program,
allocation of purchase payments shall be determined by the asset allocation
model.

TRANSFERS OF CONTRACT VALUES PROVISION

Because this rider requires participation in our asset allocation program,
transfer privileges granted under the contract are suspended other than: 1)
transfers among the available asset allocation models as described above, 2)
transfers necessary to adjust contract value allocations to match the allocation
percentages utilized in your asset allocation model, or 3) transfers as
otherwise agreed to by us. Transfers made by you into and out of the same
subaccount within a five business day period (or vice versa) may be to the
disadvantage of other contract owners and are prohibited.

RULES FOR SURRENDER PROVISION

For surrenders, the surrender will be made from the variable subaccounts and
Regular Fixed Account in the same proportion as your interest in each bears to
the contract value less amounts in any Special DCA fixed account. You cannot
specify from which accounts the surrender is to be made.

If the contract value falls to zero and the total RBA is greater than zero, the
following will occur:

(A)  If the Covered Person has not reached the ALPAA and the contract value is
     reduced to zero as a result of fees or charges, or a withdrawal that is
     less than or equal to the RBP, the owner must choose to receive either the
     remaining schedule of GBPs until the total RBA equals zero, or wait until
     the rider anniversary following the date the Covered Person reaches the
     ALPAA and receive the ALP annually until the later of:

     (i)  the death of the Covered Person; or

     (ii) the total RBA is reduced to zero.

     We will notify you of this option. If no election is made, the ALP will be
     paid.

(B)  If the Covered Person has reached the ALPAA and the contract value is
     reduced to zero as a result of fees or charges, or a withdrawal that is
     less than or equal to both the RBP and the

                                     Page 8

<PAGE>

     RALP, the owner must choose to receive either the remaining schedule of
     GBPs until the total RBA equals zero, or the ALP which will be paid
     annually until the later of:

     (i)  the death of the Covered Person; or

     (ii) the total RBA is reduced to zero.

     We will notify you of this option. If no election is made, the ALP will be
     paid.

(C)  If the Covered Person has reached the ALPAA and the contract value is
     reduced to zero as a result of a withdrawal that is greater than the RALP,
     but less than or equal to the RBP, the remaining schedule of GBPs will be
     paid until the total RBA equals zero.

(D)  If the Covered Person has reached the ALPAA and the contract value is
     reduced to zero as a result of a withdrawal that is greater than the RBP
     but less than or equal to the RALP, the ALP will be paid annually until the
     death of the Covered Person.

In (A), (B), (C) and (D) above:

-    These annualized amounts will be paid in the frequency that you elect. The
     frequencies will be among those offered by us at that time but will be no
     less frequently than annually.

-    We will no longer accept subsequent purchase payments.

-    No more charges will be collected for the rider.

-    The death benefit becomes the remaining payments, if any, until the RBA is
     reduced to zero.

If the contract value is reduced to zero as a result of a withdrawal that is
greater than the RALP but less than or equal to the RBP, and the total RBA is
reduced to zero, this rider and the contract will terminate.

If the contract value is reduced to zero as a result of a withdrawal that is
greater than both the RBP and the RALP, this rider and the contract will
terminate.

DEATH BENEFIT BEFORE THE SETTLEMENT DATE

If the contract value is greater than zero when the death benefit becomes
payable, the beneficiary may: 1) elect to take the death benefit under the terms
of the contract, 2) take the fixed payout option available under this rider, or
3) continue the contract under the spousal continuation provision below.

If the contract value equals zero and the death benefit becomes payable, the
following will occur:

(A)  If the RBA is greater than zero and the owner had been receiving the GBP
     each year, the GBP will continue to be paid to the beneficiary until the
     RBA is depleted.

(B)  If the Covered Person dies and the RBA is greater than zero and the owner
     had been receiving the ALP each year, the ALP will continue to be paid to
     the beneficiary until the RBA is depleted.

(C)  If the Covered Person is still alive and the RBA is greater than zero and
     the owner had been receiving the ALP each year, the ALP will continue to be
     paid to the beneficiary until the later of the death of the Covered Person
     or the RBA is depleted.

(D)  If the Covered Person is still alive and the RBA equals zero and the owner
     had been receiving the ALP each year, the ALP will continue to be paid to
     the beneficiary until the death of the Covered Person.

(E)  If the Covered Person dies and the RBA equals zero, the benefit terminates.
     No further payments are made.

SPOUSE OPTION TO CONTINUE CONTRACT UPON OWNER'S DEATH

If a surviving spouse chooses to continue the contract under the spousal
continuation provision, the following provisions apply:

1.   The rider continues as part of the contract.

2.   The Waiting Period is cancelled and any Waiting Period limitations on
     withdrawals and Step-ups terminate.

3.   The Covered Person will be redetermined for the continued rider and is the
     Covered Person referred to below. The GBA, RBA, and GBP remain unchanged.
     The RBP will be reset equal to the GBP less all prior withdrawals made
     during the current contract year but not less than zero. The ALP and RALP
     will be reset as follows:

     (A)  If the ALP has been established and the Covered Person has reached the
          ALPAA as of the date of the continuation, the ALP is reset to the
          lesser of:

          i)   the ALP prior to continuation or

          ii)  the contract value upon continuation multiplied by the ALP
               Percentage shown under Contract Data.

          The RALP is reset to the ALP less all prior withdrawals made during
          the current

                                     Page 9

<PAGE>

          contract year, but will never be less than zero.

     (B)  If the ALP has been established but the Covered Person has not reached
          the ALPAA as of the date of the continuation, the ALP and RALP are
          reset to zero from the date of continuation until the rider
          anniversary following the date the Covered Person reaches the ALPAA.
          At that time, the ALP is reset to the ALP Percentage shown under
          Contract Data multiplied by the lesser of the RBA or that anniversary
          contract value, and the RALP is set equal to the ALP.

     (C)  If the ALP has not been established but the Covered Person has reached
          the ALPAA as of the date of the continuation, the ALP is established
          on the date of continuation as the ALP Percentage shown under Contract
          Data multiplied by the lesser of the RBA or the contract value. The
          RALP is established equal to the ALP less all prior withdrawals made
          during the current contract year, but will never be less than zero.

     (D)  If the ALP has not been established and the Covered Person has not
          reached the ALPAA as of the date of the continuation, the ALP will be
          established on the rider anniversary following the date the Covered
          Person reaches the ALPAA as the ALP Percentage shown under Contract
          Data multiplied by the lesser of the RBA or that anniversary contract
          value. The RALP is established equal to the ALP.

4.   At the time of spousal continuation, a Step-up will be available if A) your
     contract value is greater than the RBA and/or B) the ALP Percentage shown
     under Contract Data times your contract value is greater than the ALP. All
     Annual Step-up rules, other than those that apply to the Waiting Period,
     also apply to the spousal continuation Step-up. If the spousal continuation
     Step-up is processed automatically, the Step-up date is the valuation date
     spousal continuation is effective. If not, the Step-up date is the
     valuation date we receive the spouse's written request to Step-up if we
     receive the request by the close of business on that day, otherwise the
     next valuation date.

CHANGE OF OWNERSHIP

If there is a change of ownership, the Covered Person will be redetermined and
is the Covered Person referred to below. The GBA, RBA, GBP, and RBP values will
remain unchanged. The ALP and RALP will be reset as follows:

(A)  If the ALP has been established and the Covered Person has reached the
     ALPAA as of the date of the ownership change, the ALP is reset to the
     lesser of:

     i)   the current ALP or

     ii)  the current contract value multiplied by the ALP Percentage shown
          under Contract Data.

     If the ownership change occurs prior to a withdrawal during the Waiting
     Period, the RALP is reset to the lesser of:

     i)   the ALP or

     ii)  total purchase payments plus any purchase payment credits multiplied
          by the ALP Percentage shown under Contract Data.

     If the ownership change occurs at any other time, the RALP is reset to the
     ALP less all prior withdrawals made during the current contract year, but
     will never be less than zero.

(B)  If the ALP has been established and the Covered Person has not reached the
     ALPAA as of the date of the ownership change, the ALP and RALP are reset to
     zero from the date of the ownership change until the rider anniversary
     following the date the Covered Person reaches the ALPAA. At that time, the
     ALP is reset to the ALP Percentage shown under Contract Data multiplied by
     the lesser of the RBA or that anniversary contract value. If that
     anniversary is prior to a withdrawal during the Waiting Period, the RALP is
     set on that anniversary equal to the lesser of:

     i)   the ALP or

     ii)  total purchase payments plus any purchase payment credits multiplied
          by the ALP Percentage shown under Contract Data.

     At any other time, the RALP is set on that anniversary equal to the ALP.

(C)  If the ALP has not been established but the Covered Person has reached the
     ALPAA as of the date of the ownership change, the ALP is established on the
     date of the ownership change as the ALP Percentage shown under Contract
     Data multiplied by the lesser of the RBA or the contract value. If the
     ownership change occurs prior to a withdrawal during the Waiting Period,
     the RALP is established on the date of the ownership change equal to the
     lesser of:

     i)   the ALP or

     ii)  total purchase payments plus any purchase payment credits multiplied
          by the ALP Percentage shown under Contract Data.

                                    Page 10

<PAGE>

     If the ownership change occurs at any other time, the RALP is established
     on the date of the ownership change equal to the ALP less all prior
     withdrawals made during the current contract year but will never be less
     than zero.

(D)  If the ALP has not been established and the Covered Person has not reached
     the ALPAA as of the date of the ownership change, the ALP will be
     established on the rider anniversary following the date the Covered Person
     reaches the ALPAA as the ALP Percentage shown under Contract Data
     multiplied by the lesser of the RBA or that anniversary contract value. If
     that anniversary is prior to a withdrawal during the Waiting Period, the
     RALP is established on that anniversary equal to the lesser of:

     i)   the ALP or

     ii)  total purchase payments plus any purchase payment credits multiplied
          by the ALP Percentage shown under Contract Data.

At any other time, the RALP is established on that anniversary equal to the ALP.

ANNUAL RIDER CHARGE

We deduct the charge on a pro-rata basis among the variable subaccounts, but not
the Fixed Account, in the same proportion your value in each bears to your total
variable account contract value. We deduct the charge (or the entire variable
account contract value if less) 60 days after each contract anniversary.

The fee is calculated 60 days after your contract anniversary by multiplying the
Annual Rider Charge by the greater of the contract value or the total RBA on
that date. This charge may vary with your asset allocation model.

The Initial Annual Rider Charge associated with your initial asset allocation
model is shown on your Contract Data page. This charge will increase if:

(A)  you elect to change your asset allocation model and the Annual Rider Charge
     for the new asset allocation model is higher; or

(B)  you elect the Annual Step-up or spousal continuation Step-up and the then
     current Annual Rider Charge for the asset allocation model at the time of
     the Step-up has increased.

The new charge will be the charge in effect on the valuation date we receive
your written request to change your asset allocation model or Step-up if we
receive your request before the close of business on that day, otherwise the
charge in effect on the next valuation date.

There is no increase in the Annual Rider Charge for automatic Annual Step-ups,
automatic spousal continuation Step-ups, or for any required reallocation of
your contract value to the Target Model following a withdrawal.

The Annual Rider Charge is subject to the Maximum Annual Rider Charge shown
under Contract Data.

If the rider charge changes during a contract year, we will calculate an average
rider charge, for that contract year only, that reflects the various different
charges that were in effect that year, adjusted for the number of calendar days
each charge was in effect.

If your contract or rider is terminated for any reason, the rider charge will be
deducted, adjusted for the number of calendar days since the last charge was
taken.

TERMINATION OF THE RIDER

This rider cannot be terminated either by you or us except as follows:

1.   After the death benefit is payable, continuation of the contract by any one
     other than your spouse will terminate the rider.

2.   Settlement of the contract under an annuity payment plan will terminate the
     rider.

3.   Termination of the contract for any reason will terminate the rider.

################################################################################

ABCD

Secretary

                                     Page 11

<PAGE>

Guaranteed Minimum Withdrawal Benefit Rider   Effective 05-15-2007

<TABLE>
<S>                                                 <C>
Covered Person                                      John Doe
Initial Annual Rider Charge                         .65%
Maximum Annual Rider Charge                         1.50%
Maximum RBA and GBA                                 $5,000,000
Maximum ALP                                         $300,000
GBP Percentage                                      7%
ALP Percentage                                      6%
Waiting Period                                      3 Years
Annual Lifetime Payment Attained Age                Age 68
Initial Asset Allocation Model Selection            Moderately Aggressive
Target Model                                        Moderate
Number of Model Changes Allowed Per Contract Year   2
</TABLE>

-    This Guaranteed Minimum Withdrawal Benefit rider requires participation in
     our Asset Allocation Program containing certain variable subaccounts and
     the fixed account, if applicable. There is no additional charge for such
     participation.

-    Because the rider requires that your contract value be invested in one of
     the asset allocation models for the life of the contract, and you cannot
     terminate the rider once you have selected it, you must terminate your
     contract by requesting a full surrender if you do not want to participate
     in any of the asset allocation models. Surrender charges and tax penalties
     may apply. Therefore, you should not select the rider if you do not intend
     to continue participating in one of the asset allocation models for the
     life of the rider.

-    Rider charges may vary by model selection and will change if you change
     your asset allocation model to one for which the price is higher at the
     time of the change. Rider charges will change if you elect to Step-up the
     Remaining Benefit Amount (RBA) and/or the Annual Lifetime Payment (ALP) and
     the then current charge for the asset allocation model at the time of the
     Step-up is higher. Rider charges will never exceed the Maximum Annual
     Charge shown above.

-    If you take a withdrawal and you are invested more aggressively than the
     Target Model, your contract value will be automatically reallocated to the
     Target Model. After a withdrawal, you can only allocate your contract value
     to the Target Model or less aggressive asset allocation models without
     affecting your guarantees.

-    Contracts issued with an initial purchase payment higher than the Maximum
     Purchase Payments Permitted require corporate officer approval and may
     require limitation of the number of models available for selection.

For tax-qualified contracts: You may be required to take a minimum distribution
that is greater than your Remaining Benefit Payment (RBP) or your Remaining
Annual Lifetime Payment (RALP) on the most recent rider anniversary. In many
situations, these required minimum distributions will not result in excess
withdrawal processing. However, in some circumstances, an excess withdrawal due
to a required distribution would be subject to the Guaranteed Benefit Amount
(GBA) excess withdrawal processing, the RBA excess withdrawal processing, and/or
the ALP excess withdrawal processing. And, if your tax-qualified contract is a
tax sheltered annuity (TSA) as described in Section 403(b) of the Code, the
contractual right to withdrawals is restricted. If you plan to exercise the
benefit before or after your required minimum distribution date, or if your
tax-qualified contract is a TSA, you should consult your tax advisor to consider
whether the benefit is appropriate for your circumstances.

DP139476-SGexv4w1

 

Exhibit 4.1

     UNLESS THIS GLOBAL NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO NISOURCE FINANCE CORP. AND NISOURCE
INC. OR THEIR AGENT OR AGENTS FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY GLOBAL
NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN.

     TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH
IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.

			
	 	 	 
	No.: ___

CUSIP No.: 65473QAS2

ISIN No.: US65473QAS21
	 	$___

6.40% Notes due 2018

          NiSource Finance Corp., an Indiana corporation, promises to pay to Cede & Co, or registered
assigns, the principal sum of $___ Dollars on March 15, 2018.

          Interest Payment Dates: March 15 and September 15, Commencing March 15, 2008

          Record Dates: March 1 and September 1

1

 

          Additional provisions of this Note are set forth on the other side of this Note.

Dated: August 31, 2007

	 	 	 	 	 
	 	 	NISOURCE FINANCE CORP.
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 

TRUSTEE’S CERTIFICATE OF

AUTHENTICATION

This is one of the Notes of the series

referred to in the within-mentioned Indenture.

THE BANK OF NEW YORK,

as Trustee

	 	 	 	 	 
	By:

	 	 

	 	 
	 

	 	 

Authorized Officer
	 	 

2

 

6.40% Notes due 2018

1. Interest

     NiSource Finance Corp., an Indiana corporation (such corporation, and its successors and
assigns under the Indenture hereinafter referred to, being herein called the “Company”), promises
to pay interest on the principal amount of this Note at the rate per annum shown above. The
Company will pay interest semiannually on March 15 and September 15 of each year, commencing March
15, 2008. Interest on the Notes will accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from August 31, 2007. Interest will be computed on the
basis of a 360-day year of twelve 30-day months. The Company will pay interest on overdue
principal and premium at the above rate and will pay interest on overdue installments of interest
at such rate to the extent lawful.

2. Method of Payment

     The Company will pay interest on the Notes (except defaulted interest) to the Persons who are
registered Holders of Notes at the close of business on the March 1 or September 1 next preceding
the Interest Payment Date even if Notes are canceled after the Record Date and on or before the
Interest Payment Date. Holders must surrender Notes 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. Payments in respect of
the Notes represented by a Global Note (including principal, premium, if any, and interest) will be
made by wire transfer of immediately available funds to the accounts specified by The Depository
Trust Company.

3. Guarantee

     NiSource Inc., a Delaware corporation and parent of the Company, will fully and
unconditionally guarantee to each Holder of the Notes and to The Bank of New York (as successor to
JPMorgan Chase Bank, N.A., formerly known as The Chase Manhattan Bank), as Trustee (the “Trustee”)
under the Indenture (as defined below) and its successors all the Obligations of the Company under
the Notes, including the due and punctual payment of the principal of, premium, if any, and
interest, if any, on the Notes (the “Security Guarantee”). The Security Guarantee applies whether
the payment is due at Stated Maturity, on an Interest Payment Date or as a result of acceleration,
redemption or otherwise. The Security Guarantee includes payment of interest on the overdue
principal of, premium, if any, and interest, if any, on the Notes (if lawful) and all other
Obligations of the Company under the Indenture. The Security Guarantee will remain valid even if
the Indenture is found to be invalid. NiSource Inc. is obligated under the Security Guarantee to
pay any guaranteed amount immediately after the Company’s failure to do so.

3

 

4. Paying Agent and Security Registrar

     Initially, the Trustee will act as Paying Agent and Security Registrar. The Company may
appoint and change any Paying Agent or Security Registrar without notice to the Holders. The
Company may act as Paying Agent or Security Registrar.

5. Indenture

     The Company issued the Notes under an Indenture dated as of November 14, 2000, among the
Company, NiSource Inc. and the Trustee (as supplemented, the “Indenture”) and pursuant to an
Officers’ Certificate of the Company dated August 31, 2007 (the “Officer’s Certificate”). The
terms of the Notes include those stated in the Indenture and the Officer’s Certificate and those
made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. sections
77aaa-77bbbb) as in effect on the date of the Officer’s Certificate (the “Act”). Capitalized terms
used herein and defined in the Indenture but not defined herein have the meanings ascribed thereto
in the Indenture. The Notes are subject to all such terms, and Holders of Notes are referred to
the Indenture and the Act for a statement of those terms.

     The Notes are senior unsecured obligations of the Company. The Notes issued on the Issue Date
will be treated as a single class for all purposes under the Indenture. The Indenture contains
covenants that limit the ability of the Company, NiSource Inc. and their Subsidiaries (other than
Utilities) to incur additional indebtedness and create liens on assets unless the total amount of
all the secured debt would not exceed 10% of Consolidated Net Tangible Assets. These covenants are
subject to important exceptions and qualifications.

6. Optional Redemption

     The Company may redeem all or part of the Notes at any time at its option at a redemption
price equal to the greater of (1) 100% of the principal amount of the Notes being redeemed plus accrued
interest to the Redemption Date or (2) the Make-Whole Amount for the Notes being redeemed. For
purposes of this provision:

     “Make-Whole Amount” means the sum, as determined by a Quotation Agent, of the present values
of the principal amount of the Notes to be redeemed, together with scheduled payments of interest
(exclusive of interest to the Redemption Date) from the Redemption Date to the Stated Maturity of
the Notes, in each case discounted to the Redemption Date on a semi-annual basis, assuming a
360-day year consisting of twelve 30-day months, at the Adjusted Treasury Rate, plus accrued
interest on the principal amount of the Notes being redeemed to the Redemption Date.

     “Adjusted Treasury Rate” means, with respect to any Redemption Date, (i) the yield, under the
heading which represents the average for the immediately preceding week, appearing in the most
recently published statistical release designated “H.15 (519)” or any successor publication which
is published weekly by the Board of Governors of the Federal Reserve System and which establishes
yields on actively traded United States Treasury securities adjusted to constant maturity under the
caption “Treasury Constant

4

 

Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity
is within three months before or after the remaining term of the Notes, yields for the two
published maturities most closely corresponding to the Comparable Treasury Issue shall be
determined and the Adjusted Treasury Rate shall be interpolated or extrapolated from such yields on
a straight line basis, rounding to the nearest month) or (ii) if such release (or any successor
release) is not published during the week preceding the calculation date or does not contain such
yields, the rate per year equal to the semi-annual equivalent yield to maturity of the Comparable
Treasury Issue assuming a price for the Comparable Treasury Issue (expressed as a percentage of its
principal amount) equal to the Comparable Treasury Price for such Redemption Date, in each case
calculated on the third Business Day preceding the Redemption Date, plus 0.30%.

     “Comparable Treasury Issue” means the United States Treasury security selected by the
Quotation Agent as having a maturity comparable to the remaining term from the Redemption Date to
the Stated Maturity of the Notes that would be utilized, at the time of selection and in accordance
with customary financial practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of the Notes.

     “Comparable Treasury Price” means, with respect to any Redemption Date, if clause (ii) of the
definition of Adjusted Treasury Rate is applicable, the average of three, or such lesser number as
is obtained by the Trustee, Reference Treasury Dealer Quotations for such Redemption Date.

     “Quotation Agent” means the Reference Treasury Dealer selected by the Trustee after
consultation with the Company.

     “Reference Treasury Dealer” means a primary U.S. Government securities dealer selected by the
Company.

     “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any Redemption Date, the average, as determined by a Reference Treasury Dealer, of the bid and
asked prices for the Comparable Treasury Issue, expressed in each case as a percentage of its
principal amount, quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m.,
New York City time, on the third Business Day preceding such Redemption Date.

7. Notice of Redemption

     If the Company is redeeming less than all the Notes at any time, the Trustee will select the
Notes to be redeemed using a method it considers fair and appropriate. Notice of redemption will
be mailed at least 30 days but not more than 60 days before the Redemption Date to each Holder of
Notes to be redeemed in accordance with Section 106 of the Indenture. Notes in denominations
larger than $1,000 principal amount may be redeemed in part but only in integral multiples of
$1,000. The Company will not know the exact Redemption Price until three Business Days before the
Redemption Date. Therefore, the notice of redemption will only describe how the

5

 

Redemption Price will be calculated. If money sufficient to pay the Redemption Price of and
accrued interest on all Notes (or portions thereof) to be redeemed on the Redemption Date is
deposited with the Paying Agent on or before the Redemption Date and certain other conditions are
satisfied, on and after such Redemption Date interest will cease to accrue on such Notes (or such
portions thereof) called for redemption.

8. Additional Notes

     The Company may, without the consent of the Holders of the Notes, create and issue Additional
Notes ranking equally with the Notes in all respects, including having the same CUSIP number, so
that such Additional Notes shall be consolidated and form a single series with the Notes and shall
have the same terms as to status, redemption or otherwise as the Notes. No Additional Notes may be
issued if an Event of Default has occurred and is continuing with respect to the Notes.

9. Denominations; Transfer; Exchange

     The Notes are in registered form without coupons in denominations of $1,000 principal amount
and integral multiples of $1,000. A Holder may transfer or exchange Notes in accordance with the
Indenture. The Security Registrar may require a Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Security Registrar need not register the transfer or exchange of any Notes
selected for redemption (except, in the case of a Note to be redeemed in part, the portion of the
Note not to be redeemed) for a period of 15 days before a selection of Notes to be redeemed.

10. Persons Deemed Owners

     The registered Holder of this Note may be treated as the owner of it for all purposes.

11. Unclaimed Money

     If money for the payment of principal or interest remains unclaimed for two years, the Trustee
or Paying Agent shall pay the money back to the Company at its request. After any such payment,
Holders entitled to the money must look only to the Company and not to the Trustee, the Paying
Agent or NiSource Inc., as guarantor, for payment.

12. Satisfaction and Discharge

     Under the Indenture, the Company can terminate its obligations with respect to the Notes not
previously delivered to the Trustee for cancellation when those Notes have become due and payable
or will become due and payable at their Stated Maturity within one year or are to be called for
redemption within one year under arrangements satisfactory to the Trustee for giving notice of
redemption. The Company may terminate its obligations with respect to the Notes by depositing with
the Trustee, as funds in trust dedicated solely for that purpose, an amount sufficient to pay and
discharge

6

 

the entire indebtedness on the Notes. In that case, the Indenture will cease to be of further
effect and the Company’s obligations will be satisfied and discharged with respect to the Notes
(except as to the Company’s obligations to pay all other amounts due under the Indenture and to
provide certain Officers’ Certificates and Opinions of Counsel to the Trustee). At the expense of
the Company, the Trustee will execute proper instruments acknowledging the satisfaction and
discharge.

13. Amendment, Waiver

     Subject to certain exceptions set forth in the Indenture, (i) the Indenture and the Notes may
be amended with the written consent of the Holders of at least a majority in principal amount
outstanding of the Notes and (ii) any default or noncompliance with any provision may be waived
with the written consent of the Holders of a majority in principal amount outstanding of the Notes.
Subject to certain exceptions set forth in the Indenture, without the consent of any Holder, the
Company and the Trustee shall be entitled to amend the Indenture to cure any ambiguity, omission,
defect or inconsistency, or to evidence the succession of another Person as obligor under the
Indenture, or to add to the Company’s or NiSource Inc.’s covenants or to surrender any right or
power conferred on the Company or NiSource Inc. under the Indenture, or to add events of default,
or to secure the Notes, or to evidence or provide for the acceptance or appointment by a successor
Trustee or facilitate the administration of the trusts under the Indenture by more than one
trustee, or to effect assumption by NiSource Inc. or one of its Subsidiaries of the Company’s
obligations under the Indenture, or to conform the Indenture to any amendment of the Trust
Indenture Act.

14. Defaults and Remedies

     Under the Indenture, Events of Default include: (i) default by the Company in the payment of
any interest upon any Note and the continuance of such default for 60 days; (ii) default by the
Company in the payment of principal of or any premium on any Note when due at Stated Maturity, on
redemption, by declaration or otherwise, and the continuance of such default for three Business
Days; (iii) default by the Company or NiSource Inc. in the performance of or breach of any covenant
or warranty in the Indenture and continuance of such default for 90 days after written notice to
the Company or NiSource Inc. from the Trustee or to the Company, NiSource Inc. and the Trustee from
the Holders of at least 33% in principal amount of the Outstanding Notes; (iv) default by the
Company or NiSource Capital Markets, Inc. under any bond, debenture, note or other evidence of
indebtedness for money borrowed by the Company or NiSource Capital Markets, Inc., or the Company or
NiSource Capital Markets, Inc. defaults under any mortgage, indenture or instrument under which
there may be issued, secured or evidenced indebtedness constituting a failure to pay in excess of
$50,000,000 of the principal or interest when due and payable, subject to certain cure rights; (v)
the guarantee by NiSource Inc. ceases to be in full force and effect or is disaffirmed or denied
(other than according to its terms), or is found to be unenforceable or invalid; or (vi) certain
events of bankruptcy, insolvency or reorganization of the Company, NiSource Capital Markets, Inc.
or NiSource Inc. If an Event of Default occurs and is continuing,

7

 

the Trustee or the Holders of at least 33% in principal amount of the Notes may declare all
the Notes to be due and payable immediately.

     Holders may not enforce the Indenture or the Notes except as provided in the Indenture. The
Trustee may refuse to enforce the Indenture or the Notes unless it receives indemnity or security
satisfactory to it. Subject to certain limitations, Holders of a majority in principal amount of
the Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold
from Holders notice of any continuing default (except a default in payment of principal or
interest) if it determines that withholding notice is in the interest of the Holders.

15. Trustee Dealings with the Company

     Subject to certain limitations imposed by the Act, the Trustee under the Indenture, in its
individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal
with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal
with the Company or its Affiliates with the same rights it would have if it were not Trustee.

16. No Recourse Against Others

     A director, officer, employee or stockholder, as such, of the Company, NiSource Inc. or the
Trustee shall not have any liability for any obligations of the Company under the Notes or the
Indenture, or any obligations of NiSource Inc. under the Security Guarantee or the Indenture, or
for any claim based on, in respect of or by reason of such obligations or their creation. By
accepting a Note, each Holder waives and releases all such liability. The waiver and release are
part of the consideration for the issue of the Notes and the Security Guarantee.

17. Authentication

     This Note shall not be valid until an authorized signatory of the Trustee (or an
Authenticating Agent) manually signs the certificate of authentication on the other side of this
Note.

18. Abbreviations

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

19. CUSIP, ISIN and Common Code Numbers

     Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused CUSIP numbers to be printed on the Notes and has directed the
Trustee to use CUSIP numbers in notices of redemption as a convenience to Holders. To the extent
such numbers have been issued,

8

 

the Company has caused ISIN and Common Code numbers to be similarly printed on the Notes and
has similarly instructed the Trustee. No representation is made as to the accuracy of such numbers
either as printed on the Notes or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.

20. Governing Law.

     THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE
OF NEW YORK, WITHOUT GIVING EFFECT TO CONTRARY CONFLICT OF LAWS OR CHOICE OF LAWS PROVISIONS OF THE
STATE OF NEW YORK OR ANY OTHER JURISDICTION.

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

NiSource Finance Corp.

801 East 86th Avenue

Merrillville, Indiana 46410

Attention: Secretary

9

 

ASSIGNMENT FORM

To assign this Note, fill in the form below:

I or we assign and transfer this Note to

 

 

(Print or type assignee’s name, address and zip code)

 

(Insert assignee’s soc. sec. or tax I.D. No.)

     and irrevocably appoint                                          agent to transfer this Note on the books of the Company. The agent
may substitute another to act for him.

			
	 	 	 
	Date:                     
	 	Your Signature:                                                             

	 	 	 
	 

	 	 

Sign exactly as your name appears on the
other side of this Note.

Signature Guarantee:

			
	 	 	 
	 

Signature must be guaranteed
	 	 

Signature

Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of
the Security Registrar, which requirements include membership or participation in the Security
Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be
determined by the Security Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.

10

 

SECURITY GUARANTEE

     NiSource Inc. irrevocably and unconditionally guarantees the Obligations of NiSource Finance
Corp., an Indiana corporation (the “Company”) under the 6.40% Notes due 2018 (the “Notes”) of the
Company, including that (i) the principal of, premium, if any, and interest on the Notes shall be
promptly paid in full when due, whether at Stated Maturity, by acceleration, redemption or
otherwise, and interest on the overdue principal of, premium, if any, and interest on the Notes, if
lawful, and all other Obligations of the Company to the Holders or the Trustee shall be promptly
paid in full or performed, and (ii) in case of any extension of time of payment or renewal of any
Notes or any such other Obligations, that the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at Stated Maturity, by
acceleration or otherwise. Failing payment when due of any amount so guaranteed or any performance
so guaranteed, NiSource Inc. shall be obligated to pay or perform the same immediately.

     The obligations of NiSource Inc. to the Holders and to the Trustee pursuant to this Security
Guarantee and the Indenture are expressly set forth in Article Fifteen of the Indenture, and
reference is hereby made to such Indenture for the precise terms of this Security Guarantee.

     No stockholder, employee, officer, director or incorporator, as such, past, present or future,
of NiSource Inc. shall have any liability under this Security Guarantee by reason of his or its
status as such stockholder, employee, officer, director or incorporator.

     This Security Guarantee shall remain in full force and effect and continue notwithstanding any
petition filed by or against the Company for liquidation or reorganization.

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

     THE TERMS OF ARTICLE FIFTEEN OF THE INDENTURE ARE INCORPORATED HEREIN BY REFERENCE.

11

 

     Capitalized terms used herein have the same meanings given in the Indenture unless otherwise
indicated.

	 	 	 	 	 
	 	 	NISOURCE INC.
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 

12

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