Document:

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                                                                     EXHIBIT 4.3

                             SOLECTRON CORPORATION

                                      AND

            STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A.,

                           AS PURCHASE CONTRACT AGENT

                           PURCHASE CONTRACT AGREEMENT

                          DATED AS OF DECEMBER 27, 2001

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                                TABLE OF CONTENTS

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ARTICLE I DEFINITIONS AND OTHER PROVISIONS  OF GENERAL APPLICATION...................      1

   SECTION 1.1 Definitions...........................................................      1

   SECTION 1.2 Compliance Certificates and Opinions..................................     14

   SECTION 1.3 Form of Documents Delivered to Agent..................................     15

   SECTION 1.4 Acts of Holders; Record Dates.........................................     15

   SECTION 1.5 Notices...............................................................     17

   SECTION 1.6 Notice to Holders; Waiver.............................................     18

   SECTION 1.7 Effect of Headings and Table of Contents..............................     18

   SECTION 1.8 Successors and Assigns................................................     18

   SECTION 1.9 Separability Clause...................................................     19

   SECTION 1.10 Benefits of Agreement................................................     19

   SECTION 1.11 Governing Law........................................................     19

   SECTION 1.12 Legal Holidays.......................................................     19

   SECTION 1.13 Counterparts.........................................................     19

   SECTION 1.14 Inspection of Agreement..............................................     20

ARTICLE II CERTIFICATE FORMS.........................................................     20

   SECTION 2.1 Forms of Certificates Generally.......................................     20

   SECTION 2.2 Form of Agent's Certificate of Authentication.........................     21

ARTICLE III THE UNITS................................................................     21

   SECTION 3.1 Title and Terms; Denominations........................................     21

   SECTION 3.2 Rights and Obligations Evidenced by the Certificates..................     22

   SECTION 3.3 Execution, Authentication, Delivery and Dating........................     22

   SECTION 3.4 Temporary Certificates................................................     23

   SECTION 3.5 Registration; Registration of Transfer And Exchange...................     24

   SECTION 3.6 Book-Entry Interests..................................................     26
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   SECTION 3.7 Notices to Holders....................................................     26

   SECTION 3.8 Appointment of Successor Clearing Agency..............................     27

   SECTION 3.9 Definitive Certificates...............................................     27

   SECTION 3.10 Mutilated, Destroyed, Lost and Stolen Certificates...................     27

   SECTION 3.11 Persons Deemed Owners................................................     28

   SECTION 3.12 Cancellation.........................................................     29

   SECTION 3.13 Establishment of Stripped Units......................................     30

   SECTION 3.14 Reestablishment of Normal Units......................................     31

   SECTION 3.15 Transfer of Collateral upon Occurrence of Termination Event..........     32

   SECTION 3.16 No Consent to Assumption.............................................     33

ARTICLE IV THE DEBENTURES............................................................     33

   SECTION 4.1 Payment of INTEREST; Rights to interest
               payments Preserved; Notice............................................     33

   SECTION 4.2 Notice and Voting.....................................................     34

   SECTION 4.3 Tax Event Redemption..................................................     35

ARTICLE V THE PURCHASE CONTRACTS; THE REMARKETING....................................     36

   SECTION 5.1 Purchase of Shares of Common Stock....................................     36

   SECTION 5.2 Payment of Purchase Price; Remarketing................................     37

   SECTION 5.3 Issuance of Shares of Common Stock....................................     42

   SECTION 5.4 Adjustment of Settlement Rate.........................................     42

   SECTION 5.5 Notice of Adjustments and Certain Other Events........................     50

   SECTION 5.6 Termination Event; Notice.............................................     50

   SECTION 5.7 Early Settlement......................................................     51

   SECTION 5.8 Early Settlement Upon Merger..........................................     52

   SECTION 5.9 Charges and Taxes.....................................................     55

   SECTION 5.10 No Fractional Shares.................................................     55

ARTICLE VI REMEDIES..................................................................     55

   SECTION 6.1 Unconditional Right of Holders to Purchase Common Stock...............     55

   SECTION 6.2 Restoration of Rights and Remedies....................................     56

   SECTION 6.3 Rights and Remedies Cumulative........................................     56
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   SECTION 6.4 Delay or Omission Not Waiver..........................................     56

   SECTION 6.5 Undertaking for Costs.................................................     56

   SECTION 6.6 Waiver of Stay or Extension Laws......................................     57

ARTICLE VII THE AGENT................................................................     57

   SECTION 7.1 Certain Duties and Responsibilities...................................     57

   SECTION 7.2 Notice of Default.....................................................     58

   SECTION 7.3 Certain Rights of Agent...............................................     58

   SECTION 7.4 Not Responsible for Recitals or Issuance of Units.....................     60

   SECTION 7.5 May Hold Units........................................................     60

   SECTION 7.6 Money Held in Custody.................................................     60

   SECTION 7.7 Compensation and Reimbursement........................................     60

   SECTION 7.8 Corporate Agent Required; Eligibility.................................     61

   SECTION 7.9 Resignation and Removal; Appointment of Successor.....................     61

   SECTION 7.10 Acceptance of Appointment by Successor...............................     63

   SECTION 7.11 Merger, Conversion, Consolidation or Succession to Business..........     63

   SECTION 7.12 Preservation of Information; Communications to Holders...............     64

   SECTION 7.13 No Obligations of Agent..............................................     64

   SECTION 7.14 Tax Compliance.......................................................     64

ARTICLE VIII SUPPLEMENTAL AGREEMENTS.................................................     65

   SECTION 8.1 Supplemental Agreements Without Consent of Holders....................     65

   SECTION 8.2 Supplemental Agreements with Consent of Holders.......................     66

   SECTION 8.3 Execution of Supplemental Agreements..................................     67

   SECTION 8.4 Effect of Supplemental Agreements.....................................     67

   SECTION 8.5 Reference to Supplemental Agreements..................................     67

ARTICLE IX CONSOLIDATION, MERGER, SALE OR CONVEYANCE.................................     68

   SECTION 9.1 Covenant Not to Merge, Consolidate, Sell or Convey Property
               Except Under Certain Conditions.......................................     68

   SECTION 9.2 Rights and Duties of Successor Corporation............................     68

   SECTION 9.3 Opinion of Counsel Given to Agent.....................................     69

ARTICLE X COVENANTS..................................................................     69
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   SECTION 10.1 Performance Under Purchase Contracts.................................     69

   SECTION 10.2 Maintenance of Office or Agency......................................     69

   SECTION 10.3 Company to Reserve Common Stock......................................     70

   SECTION 10.4 Covenants as to Common Stock.........................................     70

   SECTION 10.5 Statements of Officer of the Company as to Default...................     70
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EXHIBITS

EXHIBIT A  Form of Normal Units Certificate
EXHIBIT B  Form of Stripped Units Certificate
EXHIBIT C  Instruction from Purchase Contract Agent to Collateral Agent
EXHIBIT D  Instruction to Purchase Contract Agent

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              PURCHASE CONTRACT AGREEMENT, dated as of December 27, 2001,
between Solectron Corporation, a Delaware corporation (the "Company"), and State
Street Bank and Trust Company of California, N.A., a national banking
association, acting as purchase contract agent for the Holders of Units from
time to time (the "Agent").

                                    RECITALS

              The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the Units.

              All things necessary to make the Purchase Contracts, when the
Certificates are executed by the Company and authenticated, executed on behalf
of the Holders and delivered by the Agent, as provided in this Agreement, the
valid obligations of the Company, and to constitute this Agreement a valid
agreement of the Company, in accordance with its terms, have been done.

                                   WITNESSETH:

              For and in consideration of the premises and the purchase of the
Units by the Holders thereof, it is mutually agreed as follows:

                                    ARTICLE I

                        DEFINITIONS AND OTHER PROVISIONS
                             OF GENERAL APPLICATION

       SECTION 1.1 DEFINITIONS.

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

              (a) the terms defined in this Article have the meanings assigned
       to them in this Article and include the plural as well as the singular,
       and nouns and pronouns of the masculine gender include the feminine and
       neuter genders;

              (b) all accounting terms not otherwise defined herein have the
       meanings assigned to them in accordance with generally accepted
       accounting principles in the United States as of the date hereof;

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

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

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

              "Affiliate" has the same meaning as given to that term in Rule 405
       of the Securities Act or any successor rule thereunder.

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

              "Agent-purchased Treasury Consideration" has the meaning specified
       in Section 5.2(b)(i).

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

              "Applicable Market Value" has the meaning specified in Section
       5.1.

              "Applicants" has the meaning specified in Section 7.12(b).

              "Bankruptcy Code" means Title 11 of the United States Code, or any
       other law of the United States that from time to time provides a uniform
       system of bankruptcy laws.

              "Beneficial Owner" means, with respect to a Book-Entry Interest, a
       Person who is the beneficial owner of such Book-Entry Interest as
       reflected on the books of the Clearing Agency or on the books of a Person
       maintaining an account with such Clearing Agency (directly as a Clearing
       Agency Participant or as an indirect participant, in each case in
       accordance with the rules of such Clearing Agency).

              "Board of Directors" means either the Board of Directors of the
       Company or the Pricing Committee of such Board or any other committee of
       such Board duly authorized to act generally or in any particular respect
       for the Board hereunder.

              "Board Resolution" means (i) a copy of a resolution certified by
       the Secretary or the Assistant Secretary of the Company to have been duly
       adopted by the Board of Directors, the Pricing Committee or any other
       duly authorized committee of the Board of Directors and to be in full
       force and effect on the date of such certification, (ii) a copy of a
       unanimous written consent of the Board of Directors, the Pricing
       Committee or any other duly authorized committee of the

                                       2
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       Board of Directors or (iii) a certificate signed by the authorized
       officer or officers to whom the Board of Directors has delegated its
       authority, and in each case, delivered to the Agent.

              "Book-Entry Interest" means a beneficial interest in a Global
       Certificate, ownership and transfers of which shall be maintained and
       made through book entries by a Clearing Agency as described in Section
       3.6.

              "Business Day" means any day that is not a Saturday, Sunday or day
       on which banking institutions and trust companies in The City of New York
       or at a place of payment are authorized or required by law, regulation or
       executive order to close.

              "Capital Stock" means any and all shares, interests, rights to
       purchase, warrants, options, participations or other equivalents of or
       interests in (however designated, whether voting or non-voting) corporate
       stock or similar interests in other types of entities.

              "Cash Merger" has the meaning set forth in Section 5.8.

              "Certificate" means a Normal Units Certificate or a Stripped Units
       Certificate.

              "Clearing Agency" means an organization registered as a "clearing
       agency" pursuant to Section 17A of the Exchange Act that is acting as a
       depositary for the Units and in whose name, or in the name of a nominee
       of that organization, shall be registered a Global Certificate and which
       shall undertake to effect book-entry transfers and pledges of the Units.

              "Clearing Agency Participant" means a broker, dealer, bank, other
       financial institution or other Person for whom from time to time the
       Clearing Agency effects book-entry transfers and pledges of securities
       deposited with the Clearing Agency.

              "Closing Price" has the meaning specified in Section 5.1.

              "Collateral" has the meaning specified in Section 2.1 of the
       Pledge Agreement.

              "Collateral Agent" means U.S. Bank, N. A., a national banking
       association, as Collateral Agent under the Pledge Agreement until a
       successor Collateral Agent shall have become such pursuant to the
       applicable provisions of the Pledge Agreement, and thereafter "Collateral
       Agent" shall mean the Person who is then the Collateral Agent thereunder.

              "Collateral Substitution" has the meaning specified in Section
       3.13.

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              "Common Stock" means the Common Stock, par value $0.001 per share,
       of the Company.

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

              "Constituent Person" has the meaning specified in Section 5.4(b).

              "Corporate Trust Office" means the corporate trust office of the
       Agent at which, at any particular time, the relationship created by this
       Agreement shall be administered, which office at the date hereof is
       located at 633 West 5th Street, 12th Floor, Los Angeles, CA 90071.

              "Coupon Rate" means the percentage rate per annum at which each
       Debenture will bear interest initially.

              "Current Market Price" has the meaning specified in Section
       5.4(a)(8).

              "Custodial Agent" means U.S. Bank. N.A., a national banking
       association, as Custodial Agent under the Pledge Agreement until a
       successor Custodial Agent shall have become such pursuant to the
       applicable provisions of the Pledge Agreement, and thereafter "Custodial
       Agent" shall mean the Person who is then the Custodial Agent thereunder.

              "Debentures" means the series of subordinated debt securities of
       the Company designated the 7.25% Subordinated Debentures due 2006, to be
       issued under the First Supplemental Indenture.

              "Depositary" means, initially, DTC, until another Clearing Agency
       becomes its successor.

              "DTC" means The Depository Trust Company, the initial Clearing
       Agency.

              "Early Settlement" has the meaning specified in Section 5.7(a).

              "Early Settlement Amount" has the meaning specified in Section
       5.7(a).

              "Early Settlement Date" has the meaning specified in Section
       5.7(a).

              "Early Settlement Rate" has the meaning specified in Section
       5.7(b).

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

                                       4
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              "Expiration Date" has the meaning specified in Section 1.4.

              "Expiration Time" has the meaning specified in Section 5.4(a)(6).

              "Failed Remarketing" has the meaning specified in Section
       5.2(b)(ii).

              "Fair Market Value" with respect to securities distributed in a
       Spin-Off means (a) in the case of any Spin-Off that is effected
       simultaneously with an Initial Public Offering of such securities, the
       initial public offering price of those securities, (b) in the case of any
       other Spin-Off, (i) the average of the Sale Price of those securities
       over the first 10 Trading Days after the effective date of such Spin-Off,
       or (ii) if the Sale Price is required to be defined without regard to the
       price on any Trading Days, the Sale Price as of the effective date of
       such Spin-Off.

              "First Supplemental Indenture" means the First Supplemental
       Indenture, dated as of December 27, 2001, between the Company and the
       Trustee.

              "Global Certificate" means a Certificate that evidences all or
       part of the Units and is registered in the name of a Depositary or a
       nominee thereof.

              "Holder" means the Person in whose name the Unit evidenced by a
       Normal Units Certificate and/or a Stripped Units Certificate is
       registered in the related Normal Units Register and/or the Stripped Units
       Register, as the case may be.

              "Indenture" means the Base Indenture, dated as of December 27,
       2001, between the Company and the Trustee, as supplemented by the First
       Supplemental Indenture.

              "Initial Public Offering" with respect to a Spin-Off means the
       first time securities of the same class or type as the securities being
       distributed in such Spin-Off are bona fide offered to the public for cash
       in an offering registered under the Securities Act.

              "Issuer Order" or "Issuer Request" means a written order or
       request signed in the name of the Company by the Chief Executive Officer,
       the Chief Financial Officer, the President, any Vice-President, the
       Treasurer, any Assistant Treasurer, the Secretary or any Assistant
       Secretary (or other officer performing similar functions) of the Company
       and delivered to the Agent.

              "Last Failed Remarketing" has the meaning specified in Section
       5.2(b)(ii).

              "Merger Early Settlement" has the meaning specified in Section
       5.8.

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              "Merger Early Settlement Amount" has the meaning specified in
       Section 5.8.

              "Merger Early Settlement Date" has the meaning specified in
       Section 5.8.

              "Non-electing Share" has the meaning specified in Section 5.4(b).

              "Normal Unit" means the collective rights and obligations of a
       Holder of a Normal Units Certificate in respect of a Debenture or the
       appropriate Treasury Consideration, as the case may be, subject in each
       case to the Pledge thereof, and the related Purchase Contract.

              "Normal Units Certificate" means a certificate evidencing the
       rights and obligations of a Holder in respect of the number of Normal
       Units specified on such certificate, substantially in the form of Exhibit
       A hereto.

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

              "NYSE" has the meaning specified in Section 5.1.

              "Officers' Certificate" means a certificate signed by the Chief
       Executive Officer, the Chief Financial Officer, the President or any
       Vice-President, and by the Treasurer, any Assistant Treasurer, the
       Secretary or any Assistant Secretary (or other officer performing similar
       functions) of the Company and delivered to the Agent.

              "Opinion of Counsel" means an opinion in writing signed by legal
       counsel, who may be an employee of or counsel to the Company or an
       Affiliate and who shall be reasonably acceptable to the Agent.

              "Opt-out Treasury Consideration" has meaning specified in Section
       5.2(b)(iv).

              "Outstanding Units" means, as of the date of determination, all
       Normal Units or Stripped Units evidenced by Certificates theretofore
       authenticated, executed and delivered under this Agreement, except:

                     (i) If a Termination Event has occurred, (A) Stripped Units
              and (B) Normal Units for which the related Debenture or the
              appropriate Treasury Consideration, as the case may be, has been
              theretofore deposited with the Agent in trust for the Holders of
              such Normal Units;

                     (ii) Normal Units and Stripped Units evidenced by
              Certificates theretofore cancelled by the Agent or delivered to
              the Agent for

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              cancellation or deemed cancelled pursuant to the provisions of
              this Agreement; and

                     (iii) Normal Units and Stripped Units evidenced by
              Certificates in exchange for or in lieu of which other
              Certificates have been authenticated, executed on behalf of the
              Holder and delivered pursuant to this Agreement, other than any
              such Certificate in respect of which there shall have been
              presented to the Agent proof satisfactory to it that such
              Certificate is held by a bona fide purchaser in whose hands the
              Normal Units or Stripped Units evidenced by such Certificate are
              valid obligations of the Company;

       provided, that in determining whether the Holders of the requisite number
       of the Normal Units or Stripped Units have given any request, demand,
       authorization, direction, notice, consent or waiver hereunder, Normal
       Units or Stripped Units owned by the Company or any Affiliate of the
       Company shall be disregarded and deemed not to be outstanding, except
       that, in determining whether the Agent shall be protected in relying upon
       any such request, demand, authorization, direction, notice, consent or
       waiver, only Normal Units or Stripped Units which a Responsible Officer
       of the Agent knows to be so owned shall be so disregarded. Normal Units
       or Stripped Units so owned which have been pledged in good faith may be
       regarded as Outstanding Units if the pledgee establishes to the
       satisfaction of the Agent the pledgee's right so to act with respect to
       such Normal Units or Stripped Units and that the pledgee is not the
       Company or any Affiliate of the Company.

              "Payment Date" means each February 15, May 15, August 15 and
       November 15, commencing February 15, 2002.

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

              "Pledge" means the pledge under the Pledge Agreement of the
       Debentures, the Treasury Securities or the appropriate Treasury
       Consideration, in each case constituting a part of the Units, property,
       cash, securities, financial assets and security entitlements of the
       Collateral Account (as defined in the Pledge Agreement) and any proceeds
       of any of the foregoing.

              "Pledge Agreement" means the Pledge Agreement, dated as of the
       date hereof, by and among the Company, the Collateral Agent, the
       Custodial Agent, the Securities Intermediary and the Agent, on its own
       behalf and as attorney-in-fact for the Holders from time to time of the
       Units.

              "Pledged Debentures" has the meaning set forth in the Pledge
       Agreement.

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<PAGE>

              "Pledged Treasury Consideration" has the meaning set forth in the
       Pledge Agreement.

              "Pledged Treasury Securities" has the meaning set forth in the
       Pledge Agreement.

              "Predecessor Certificate" means a Predecessor Normal Units
       Certificate or a Predecessor Stripped Units Certificate.

              "Predecessor Normal Units Certificate" of any particular Normal
       Units Certificate means every previous Normal Units Certificate
       evidencing all or a portion of the rights and obligations of the Company
       and the Holder under the Normal Units evidenced thereby; and, for the
       purposes of this definition, any Normal Units Certificate authenticated
       and delivered under Section 3.10 in exchange for or in lieu of a
       mutilated, destroyed, lost or stolen Normal Units Certificate shall be
       deemed to evidence the same rights and obligations of the Company and the
       Holder as the mutilated, destroyed, lost or stolen Normal Units
       Certificate.

              "Predecessor Stripped Units Certificate" of any particular
       Stripped Units Certificate means every previous Stripped Units
       Certificate evidencing all or a portion of the rights and obligations of
       the Company and the Holder under the Stripped Units evidenced thereby;
       and, for the purposes of this definition, any Stripped Units Certificate
       authenticated and delivered under Section 3.10 in exchange for or in lieu
       of a mutilated, destroyed, lost or stolen Stripped Units Certificate
       shall be deemed to evidence the same rights and obligations of the
       Company and the Holder as the mutilated, destroyed, lost or stolen
       Stripped Units Certificate.

              "Purchase Contract," when used with respect to any Unit, means the
       contract forming a part of such Unit and obligating the Company to sell
       and the Holder of such Unit to purchase Common Stock on the terms and
       subject to the conditions set forth in Article Five.

              "Purchase Contract Settlement Fund" has the meaning specified in
       Section 5.3.

              "Purchase Price" has the meaning specified in Section 5.1.

              "Purchased Shares" has the meaning specified in Section 5.4(a)(6).

              "Quotation Agent" means the primary U.S. government securities
       dealer located in New York City and retained by the Company in order to
       determine the price of the Redemption Treasury Portfolio. The Company
       shall retain Goldman, Sachs, & Co. or a successor as the Quotation Agent;
       provided that if Goldman, Sachs, & Co. ceases to be a primary government
       securities dealer or does not wish

                                       8
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       to perform the services of the Quotation Agent under the First
       Supplemental Indenture, the Company shall retain another primary U.S.
       government securities dealer as quotation agent.

              "Record Date" for the distribution payable on any Payment Date
       means, as to any Global Certificate, the Business Day next preceding such
       Payment Date, and as to any other Certificate, a day selected by the
       Company which shall be more than one Business Day but less than 60
       Business Days prior to such Payment Date.

              "Redemption Amount" means, for each Debenture, the product of (i)
       the principal amount of such Debenture and (ii) a fraction whose
       numerator is the applicable Redemption Treasury Portfolio Purchase Price
       and whose denominator is the applicable Redemption Principal Amount.

              "Redemption Price" means the redemption price per Debenture equal
       to the Redemption Amount plus any accrued and unpaid interest on such
       Debenture to the date of redemption.

              "Redemption Principal Amount" means either (i) if the Tax Event
       Redemption Date occurs prior to the successful remarketing of the
       Debentures pursuant to the provisions of Section 5.2 of this Agreement,
       the aggregate principal amount of the Debentures which are components of
       Normal Units on the Tax Event Redemption Date or (ii) if the Tax Event
       Redemption Date occurs on or after a successful remarketing of the
       Debentures pursuant to the terms of Section 5.2 of this Agreement, the
       aggregate principal amount of the Debentures outstanding on such Tax
       Event Redemption Date.

              "Redemption Treasury Portfolio" means (a) if the Tax Event
       Redemption Date occurs prior to the successful remarketing of the
       Debentures pursuant to the provisions of Section 5.2 of this Agreement, a
       portfolio of zero-coupon U.S. Treasury securities consisting of (i)
       principal or interest strips of U.S. Treasury securities which mature on
       or prior to the Stock Purchase Date in an aggregate amount equal to the
       applicable Redemption Principal Amount and (ii) with respect to each
       scheduled interest payment date on the Debentures that occurs after the
       Tax Event Redemption Date and on or before the Stock Purchase Date,
       principal or interest strips of U.S. Treasury securities which mature on
       or prior to such date in an aggregate amount equal to the aggregate
       interest payment that would be due on the applicable Redemption Principal
       Amount of the Debentures on such date, assuming that the Interest Rate on
       the Debentures were not reset on the applicable Reset Date, and (b) if
       the Tax Event Redemption Date occurs after successful remarketing of the
       Debentures in pursuant to the terms of Section 5.2 of this Agreement, a
       portfolio of zero-coupon U.S. Treasury securities consisting of (i)
       principal or interest strips of U.S. Treasury securities which mature on
       or prior to November 15, 2006 in an aggregate amount equal to the
       applicable

                                       9
<PAGE>

       Redemption Principal Amount and (ii) with respect to each scheduled
       interest payment date on the Debentures that occurs after the Tax Event
       Redemption Date, principal or interest strips of such U.S. Treasury
       securities which mature on or prior to such date in an aggregate amount
       equal to the aggregate interest payment that would be due on the
       applicable Redemption Principal Amount of the Debentures on such date.

              "Redemption Treasury Portfolio Purchase Price" means the lowest
       aggregate price solicited by the Quotation Agent and quoted by a primary
       U.S. government securities dealer for the Redemption Treasury Portfolio
       on the third Business Day before the Tax Event Redemption Date for
       settlement on the Tax Event Redemption Date.

              "Register" means the Normal Units Register and the Stripped Units
       Register, as applicable.

              "Registrar" means the Normal Units Registrar and the Stripped
       Units Registrar, as applicable.

              "Remarketing Agent" has the meaning specified in Section
       5.2(b)(i).

              "Remarketing Agreement" means the Remarketing Agreement to be
       entered into by and among the Company, the Remarketing Agent and the
       Agent prior to the Remarketing Date.

              "Remarketing Date" means August 15, 2004.

              "Remarketing Fee" has the meaning specified in Section 5.2(b)(i).

              "Remarketing Value" means the sum of

                     (i) the value at the Remarketing Date or the Subsequent
              Remarketing Date, as the case may be, of U.S. Treasury securities
              that will pay, on or prior to the Payment Date falling on the
              Stock Purchase Date, an amount of cash equal to the aggregate
              interest that is scheduled to be payable on that Payment Date, on
              (1) the Debentures which are included in Normal Units and (2) the
              Separate Debentures, in each case, which are participating in the
              remarketing, assuming for that purpose that the interest rate on
              the Debentures is equal to the Coupon Rate, and

                     (ii) the value at the Remarketing Date or the Subsequent
              Remarketing Date, as the case may be, of U.S. Treasury securities
              that will pay, on or prior to the Stock Purchase Date, an amount
              of cash equal to the Stated Amount of (1) such Debentures that are
              included in Normal Units and (2) the Separate Debentures, in each
              case, which are participating in the remarketing;

                                       10
<PAGE>

       provided that for purposes of clauses (i) and (ii) above, the Remarketing
       Value shall be calculated based on (x) U.S. Treasury securities that are
       highly liquid and mature on or within 35 days prior to the Stock Purchase
       Date, as determined in good faith by the Remarketing Agent in a manner
       intended to minimize the Remarketing Value, and (y) U.S. Treasury
       securities that are valued based on the ask-side price of such U.S.
       Treasury securities at a time between 9:00 a.m. and 11:00 a.m., New York
       City time, selected by the Remarketing Agent, on the Remarketing Date or
       Subsequent Remarketing Date, as the case may be, as determined on a
       third-day settlement basis by a reasonably and customary means selected
       in good faith by the Remarketing Agent, plus accrued interest to that
       date.

              "Reorganization Event" has the meaning specified in Section
       5.4(b).

              "Reset Date" means the date of the successful remarketing of the
       Debentures pursuant to the provisions of Section 5.2 of this Agreement.

              "Responsible Officer" means, when used with respect to the Agent,
       any officer within the Corporate Trust Administration unit of the Agent
       (or any successor unit or department of the Agent) located at the
       Corporate Trust Office of the Agent who has direct responsibility for the
       administration of this Agreement and, for the purposes of Section
       7.1(b)(2), shall also include any officer of the Agent to whom any
       corporate trust matter is referred because of such person's knowledge of
       and familiarity with the particular subject.

              "Sale Price" of any securities distributed in a Spin-Off on any
       Trading Day means the closing sale price per share (or if no closing
       price is reported, the average of the bid and asked prices or, if more
       than one in either case, the average of the average bid and average asked
       prices) on such Trading Day as reported in composite transactions for the
       principal U.S. securities exchange on which such securities are traded
       or, if the securities are not listed on a U.S. national or regional
       securities exchange, as reported by Nasdaq or, if the securities are not
       so reported, the last quoted bid price for the securities in the
       over-the-counter market as reported by the National Quotation Bureau or
       similar organization, or, if such bid price is not available, the market
       value of the securities on such date as determined by a nationally
       recognized independent investment banking firm retained for this purpose
       by the Company.

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

              "Securities Intermediary" means U.S. Bank, N. A., a national
       banking association, in its capacity as Securities Intermediary under the
       Pledge Agreement, together with its successors in such capacity.

              "Separate Debentures" has the meaning set forth in the Pledge
       Agreement.

                                       11
<PAGE>

              "Settlement Date" means any Early Settlement Date or Merger Early
       Settlement Date or the Stock Purchase Date.

              "Settlement Rate" has the meaning specified in Section 5.1.

              "Spin-Off" means a dividend or other distribution on the Common
       Stock of shares of Capital Stock of any class or series, or similar
       equity interests, of or relating to a subsidiary or other business unit
       of the Company.

              "Stated Amount" means, with respect to any one Debenture, Normal
       Unit or Stripped Unit, $25.

              "Stock Purchase Date" means November 15, 2004.

              "Stripped Unit" means the collective rights and obligations of a
       holder of a Stripped Units Certificate in respect of a 1/40 undivided
       beneficial interest in a Treasury Security, subject in each case to the
       Pledge thereof, and the related Purchase Contract.

              "Stripped Units Certificate" means a certificate evidencing the
       rights and obligations of a Holder in respect of the number of Stripped
       Units specified on such certificate, substantially in the form of Exhibit
       B hereto.

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

              "Subsequent Remarketing" has the meaning specified in Section
       5.2(b)(ii).

              "Subsequent Remarketing Date" means any date on which the
       Remarketing Agent attempts a Subsequent Remarketing in accordance with
       Section 5.2 hereof.

              "Tax Event" means the receipt by the Company of an opinion of
       Wilson Sonsini Goodrich & Rosati, Professional Corporation, or other
       independent counsel having a nationally-recognized tax practice to the
       effect that, as a result of (i) any amendment to, change in, or announced
       proposed change in, the laws (or any regulations thereunder) of the
       United States or any political subdivision or taxing authority thereof or
       therein affecting taxation, (ii) any amendment to or change in an
       official interpretation or application of any such laws or regulations by
       any legislative body, court, governmental agency or regulatory authority
       or (iii) any official interpretation or pronouncement that provides for a
       position with respect to any such laws or regulations that differs from
       the generally accepted position on December 20, 2001, which amendment,
       change or proposed change is effective or which interpretation or
       pronouncement is announced on or after December 20, 2001, there is more
       than an insubstantial risk that interest or

                                       12
<PAGE>

       original issue discount on the Debentures would not be deductible, in
       whole or in part, by the Company for United States federal income tax
       purposes.

              "Tax Event Redemption" means the redemption by the Company, at its
       option, if a Tax Event has occurred and is continuing, of all, but not
       less than all, the Debentures then outstanding upon not less than 30 but
       no more than 60 days' notice to the Holders of the Debentures.

              "Tax Event Redemption Date" has the meaning specified in the First
       Supplemental Indenture.

              "Termination Date" means the date, if any, on which a Termination
       Event occurs.

              "Termination Event" means the occurrence of any of the following
       events:

                     (i) at any time on or prior to the Stock Purchase Date, a
              judgment, decree or court order shall have been entered granting
              relief under the Bankruptcy Code or any other similar Federal or
              state law, adjudicating the Company to be insolvent, or approving
              as properly filed a petition seeking reorganization or liquidation
              of the Company, and, unless such judgment, decree or order shall
              have been entered within 60 days prior to the Stock Purchase Date,
              such decree or order shall have continued undischarged and
              unstayed for a period of 60 days;

                     (ii) a judgment, decree or court order for the appointment
              of a receiver or liquidator or trustee or assignee in bankruptcy
              or insolvency of the Company or of its property, or for the
              winding up or liquidation of its affairs, shall have been entered,
              and, unless such judgment, decree or order shall have been entered
              within 60 days prior to the Stock Purchase Date, such judgment,
              decree or order shall have continued undischarged and unstayed for
              a period of 60 days; or

                     (iii) at any time on or prior to the Stock Purchase Date
              the Company shall file a petition for relief under the Bankruptcy
              Code or any other similar federal or state law, or shall consent
              to the filing of a bankruptcy proceeding against it, or shall seek
              reorganization or liquidation under the Bankruptcy Code or any
              other similar federal or state law, or shall consent to the filing
              of any such petition, or shall consent to the appointment of a
              receiver or liquidator or trustee or assignee in bankruptcy or
              insolvency of it or of its property, or shall make an assignment
              for the benefit of creditors, or shall admit in writing its
              inability to pay its debts generally as they become due.

              "Threshold Appreciation Price" has the meaning specified in
       Section 5.1.

                                       13
<PAGE>

              "Trading Day" has the meaning specified in Section 5.1.

              "Treasury Consideration" means the Agent-purchased Treasury
       Consideration, the Opt-out Treasury Consideration, or the Redemption
       Treasury Portfolio, as the case may be.

              "Treasury Security" means a zero coupon U.S. Treasury security
       (CUSIP Number 912803AB9) maturing on November 15, 2004 that will pay
       $1,000 on such maturity date.

              "Trustee" means State Street Bank and Trust Company of California,
       N.A., a national banking association, as trustee under the Indenture and
       the First Supplemental Indenture, or any successor thereto.

              "Underwriting Agreement" means the Underwriting Agreement relating
       to the Units dated December 20, 2001 among the Company and the
       underwriters named therein.

              "Unit" means a Normal Unit or a Stripped Unit.

              "Vice-President" means any vice-president, whether or not
       designated by a number or a word or words added before or after the title
       "vice-president."

       SECTION 1.2 COMPLIANCE CERTIFICATES AND OPINIONS.

              Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Agent to take any action under any
provision of this Agreement, the Company shall furnish to the Agent an Officers'
Certificate stating that all conditions precedent, if any, provided for in this
Agreement relating to the proposed action have been complied with and, if
requested by the Agent, 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
Agreement 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 Agreement shall include:

              (a) a statement that the 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;

                                       14
<PAGE>

              (c) a statement that, in the opinion of such individual, he or she
       has made such examination or investigation as is necessary to enable such
       individual 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 such individual,
       such condition or covenant has been complied with.

       SECTION 1.3 FORM OF DOCUMENTS DELIVERED TO AGENT.

              (a) 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.

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

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

       SECTION 1.4 ACTS OF HOLDERS; RECORD DATES.

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

                                       15
<PAGE>

       writing appointing any such agent shall be sufficient for any purpose of
       this Agreement and (subject to Section 7.1) conclusive in favor of the
       Agent 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 in any manner which the Agent deems
       sufficient.

              (c) The ownership of Units shall be proved by the Normal Units
       Register or the Stripped Units Register, as the case may be.

              (d) Any request, demand, authorization, direction, notice,
       consent, waiver or other Act of the Holder of any Certificate shall bind
       every future Holder of the same Certificate and the Holder of every
       Certificate 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 Agent or the Company in reliance thereon,
       whether or not notation of such action is made upon such Certificate.

              (e) The Company may set any day as a record date for the purpose
       of determining the Holders of Outstanding Units entitled to give, make or
       take any request, demand, authorization, direction, notice, consent,
       waiver or other action provided or permitted by this Agreement to be
       given, made or taken by Holders of Units. If any record date is set
       pursuant to this paragraph, the Holders of the Outstanding Normal Units
       and the Outstanding Stripped Units, as the case may be, on such record
       date, and no other Holders, shall be entitled to take the relevant action
       with respect to the Normal Units or the Stripped Units, as the case may
       be, whether or not such Holders remain Holders after such record date;
       provided that no such action shall be effective hereunder unless taken on
       or prior to the applicable Expiration Date by Holders of the requisite
       number of Outstanding Units on such record date. Nothing in this
       paragraph shall be construed to prevent the Company from setting a new
       record date for any action for which a record date has previously been
       set pursuant to this paragraph (whereupon the record date previously set
       shall automatically and with no action by any Person be cancelled and of
       no effect), and nothing in this paragraph shall be construed to render
       ineffective any action taken by Holders of the requisite number of
       Outstanding Units on the date such action is taken. Promptly after any
       record date is set pursuant to this paragraph, the Company, at its own
       expense, shall cause notice of such record date, the proposed action by
       Holders and the applicable Expiration Date to be given to the Agent in
       writing and to each Holder of Units in the manner set forth in Section
       1.6.

              (f) With respect to any record date set pursuant to this Section,
       the Company may designate any date as the "Expiration Date" and from time
       to time may change the Expiration Date to any earlier or later day;
       provided that no such

                                       16
<PAGE>

       change shall be effective unless notice of the proposed new Expiration
       Date is given to the Agent in writing, and to each Holder of Units in the
       manner set forth in Section 1.6, on or prior to the existing Expiration
       Date. If an Expiration Date is not designated with respect to any record
       date set pursuant to this Section, the Company shall be deemed to have
       initially designated the 180th day after such record date as the
       Expiration Date with respect thereto, subject to its right to change the
       Expiration Date as provided in this paragraph. Notwithstanding the
       foregoing, no Expiration Date shall be later than the 180th day after the
       applicable record date.

       SECTION 1.5 NOTICES.

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

              (a) the Agent by any Holder or by the Company shall be sufficient
       for every purpose hereunder (unless otherwise herein expressly provided)
       if made, given, furnished or filed in writing and personally delivered,
       mailed, first-class postage prepaid, telecopied or delivered by overnight
       air courier guaranteeing next day delivery, addressed to and received by
       the Agent at 633 West 5th Street, 12th Floor, Los Angeles, CA, 90071,
       Attention: Corporate Trust Administration (Solectron Corporation 2001
       Purchase Contract Agreement), telecopy: (213) 362-7357, with telephonic
       confirmation to (213) 362-7345, or at any other address furnished in
       writing by the Agent to the Holders and the Company; or

              (b) the Company by the Agent or by any Holder shall be sufficient
       for every purpose hereunder (unless otherwise herein expressly provided)
       if made, given, furnished or filed in writing and personally delivered,
       mailed, first-class postage prepaid, telecopied or delivered by overnight
       air courier guaranteeing next day delivery, addressed to and received by
       the Company at 777 Gibraltar Drive, Milpitas, CA, Attention: Chief
       Financial Officer, telecopy: (408) 957-2855, or at any other address
       furnished in writing to the Agent by the Company; or

              (c) the Collateral Agent by the Agent, the Company or any Holder
       shall be sufficient for every purpose hereunder (unless otherwise herein
       expressly provided) if made, given, furnished or filed in writing and
       personally delivered, mailed, first-class postage prepaid, telecopied or
       delivered by overnight air courier guaranteeing next day delivery,
       addressed to and received by the Collateral Agent at 180 East Fifth
       Street, St. Paul, MN 55101, Attn: Corporate Trust Services/Frank Leslie,
       telecopy: (651) 244-0711, or at any other address furnished in writing by
       the Collateral Agent to the Agent, the Company and the Holders; or

                                       17
<PAGE>

              (d) the Trustee by the Company shall be sufficient for every
       purpose hereunder (unless otherwise herein expressly provided) if made,
       given, furnished or filed in writing and personally delivered, mailed,
       first-class postage prepaid, telecopied or delivered by overnight air
       courier guaranteeing next day delivery, addressed to and received by the
       Trustee at 633 West 5th Street, 12th Floor, Los Angeles, CA, 90071,
       Attention: Corporate Trust Administration (Solectron Corporation 2001
       Purchase Contract Agreement), telecopy: (213) 362-7357, with telephonic
       confirmation to (213) 362-7345, or at any other address furnished in
       writing by the Trustee to the Company.

       SECTION 1.6 NOTICE TO HOLDERS; WAIVER.

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

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

       SECTION 1.7 EFFECT OF HEADINGS AND TABLE OF CONTENTS.

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

       SECTION 1.8 SUCCESSORS AND ASSIGNS.

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

                                       18
<PAGE>

       SECTION 1.9 SEPARABILITY CLAUSE.

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

       SECTION 1.10 BENEFITS OF AGREEMENT.

              Nothing in this Agreement or in the Units, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and, to the extent provided hereby, the Holders, any benefits or any
legal or equitable right, remedy or claim under this Agreement. The Holders from
time to time shall be beneficiaries of this Agreement and shall be bound by all
of the terms and conditions hereof and of the Units evidenced by their
Certificates by their acceptance of delivery of such Certificates.

       SECTION 1.11 GOVERNING LAW.

              This Agreement and the Units shall be governed by and construed in
accordance with the laws of the State of New York, without regard to principles
of conflicts of law.

       SECTION 1.12 LEGAL HOLIDAYS.

              (a) In any case where any Payment Date shall not be a Business
       Day, then (notwithstanding any other provision of this Agreement or the
       Normal Units Certificates) payments on the Debentures shall not be made
       on such date, but such payments shall be made on the next succeeding
       Business Day with the same force and effect as if made on such Payment
       Date, provided that no interest shall accrue or be payable by the Company
       for the period from and after any such Payment Date, except that if such
       next succeeding Business Day is in the next succeeding calendar year,
       such payment shall be made on the immediately preceding Business Day with
       the same force and effect as if made on such Payment Date.

              (b) In any case where the Stock Purchase Date shall not be a
       Business Day, then (notwithstanding any other provision of this Agreement
       or the Certificates), the Purchase Contracts shall not be performed on
       such date, but the Purchase Contracts shall be performed on the
       immediately following Business Day with the same force and effect as if
       performed on the Stock Purchase Date.

       SECTION 1.13 COUNTERPARTS.

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

                                       19
<PAGE>

       SECTION 1.14 INSPECTION OF AGREEMENT.

              A copy of this Agreement shall be available at all reasonable
times during normal business hours at the Corporate Trust Office for inspection
by any Holder.

                                   ARTICLE II

                                CERTIFICATE FORMS

       SECTION 2.1 FORMS OF CERTIFICATES GENERALLY.

              (a) The Normal Units Certificates (including the form of Purchase
       Contract forming part of the Normal Units evidenced thereby) shall be in
       substantially the form set forth in Exhibit A hereto, with such letters,
       numbers or other marks of identification or designation and such legends
       or endorsements printed, lithographed or engraved thereon as may be
       required by the rules of any securities exchange or quotation system on
       which the Normal Units are listed or quoted for trading or any depositary
       therefor, or as may, consistently herewith, be determined by the officers
       of the Company executing such Normal Units Certificates, as evidenced by
       their execution of the Normal Units Certificates.

              (b) The definitive Normal Units Certificates shall be printed,
       lithographed or engraved on steel engraved borders or may be produced in
       any other manner, all as determined by the officers of the Company
       executing such Normal Units Certificates, consistent with the provisions
       of this Agreement, as evidenced by their execution thereof.

              (c) The Stripped Units Certificates (including the form of
       Purchase Contracts forming part of the Stripped Units evidenced thereby)
       shall be in substantially the form set forth in Exhibit B hereto, with
       such letters, numbers or other marks of identification or designation and
       such legends or endorsements printed, lithographed or engraved thereon as
       may be required by the rules of any securities exchange or the quotation
       system on which the Stripped Units may be listed or quoted for trading or
       any depositary therefor, or as may, consistently herewith, be determined
       by the officers of the Company executing such Stripped Units
       Certificates, as evidenced by their execution of the Stripped Units
       Certificates.

              (d) The definitive Stripped Units Certificates shall be printed,
       lithographed or engraved on steel engraved borders or may be produced in
       any other manner, all as determined by the officers of the Company
       executing such Stripped Units Certificates, consistent with the
       provisions of this Agreement, as evidenced by their execution thereof.

                                       20
<PAGE>

              (e) Every Global Certificate authenticated, executed on behalf of
       the Holders and delivered hereunder shall bear a legend in substantially
       the following form:

              "THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF
              THE PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS
              REGISTERED IN THE NAME OF THE CLEARING AGENCY OR A NOMINEE
              THEREOF. THIS CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART
              FOR A CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE
              IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON
              OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN
              THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
              AGREEMENT."

       SECTION 2.2 FORM OF AGENT'S CERTIFICATE OF AUTHENTICATION.

              (a) The form of the Agent's certificate of authentication of the
       Normal Units shall be in substantially the form set forth on the form of
       the Normal Units Certificates.

              (b) The form of the Agent's certificate of authentication of the
       Stripped Units shall be in substantially the form set forth on the form
       of the Stripped Units Certificates.

                                   ARTICLE III

                                    THE UNITS

       SECTION 3.1 TITLE AND TERMS; DENOMINATIONS.

              (a) The aggregate number of Normal Units and Stripped Units, if
       any, evidenced by Certificates authenticated, executed on behalf of the
       Holders and delivered hereunder is limited to 40,000,000 (44,000,000 if
       the Underwriters' over-allotment option pursuant to the Underwriting
       Agreement is exercised in full), except for Certificates authenticated,
       executed and delivered upon registration of transfer of, in exchange for,
       or in lieu of, other Certificates pursuant to Section 3.4, 3.5, 3.10,
       3.13, 3.14, 5.7, 5.8 or 8.5.

              (b) The Certificates shall be issuable only in registered form and
       only in denominations of a single Unit and any integral multiple thereof.

                                       21
<PAGE>

       SECTION 3.2 RIGHTS AND OBLIGATIONS EVIDENCED BY THE CERTIFICATES.

              (a) Each Normal Units Certificate shall evidence the number of
       Normal Units specified therein, with each such Normal Unit representing
       the ownership by the Holder thereof of a beneficial interest in a
       Debenture or the appropriate Treasury Consideration, as the case may be,
       subject to the Pledge of such Debenture or such Treasury Consideration,
       as the case may be, by such Holder pursuant to the Pledge Agreement, and
       the rights and obligations of the Holder thereof and the Company under
       one Purchase Contract. The Agent as attorney-in-fact for, and on behalf
       of, the Holder of each Normal Unit shall pledge, pursuant to the Pledge
       Agreement, the Debenture or the appropriate Treasury Consideration, as
       the case may be, forming a part of such Normal Unit, to the Collateral
       Agent and grant to the Collateral Agent a security interest in the right,
       title, and interest of such Holder in such Debenture or such Treasury
       Consideration, as the case may be, for the benefit of the Company, to
       secure the obligation of such Holder under the related Purchase Contract
       to purchase the Common Stock of the Company. Prior to the purchase of
       shares of Common Stock under each Purchase Contract, such Purchase
       Contract shall not entitle the Holder of the related Normal Units
       Certificates to any of the rights of a holder of shares of Common Stock,
       including, without limitation, the right to vote or receive any dividends
       or other payments or to consent or to receive notice as stockholders in
       respect of the meetings of stockholders or for the election of directors
       of the Company or for any other matter, or any other rights whatsoever as
       stockholders of the Company.

              (b) Each Stripped Units Certificate shall evidence the number of
       Stripped Units specified therein, with each such Stripped Unit
       representing the ownership by the Holder thereof of a 1/40 undivided
       beneficial interest in a Treasury Security, subject to the Pledge of such
       interest in such Treasury Security by such Holder pursuant to the Pledge
       Agreement, and the rights and obligations of the Holder thereof and the
       Company under one Purchase Contract. Prior to the purchase of shares of
       Common Stock under each Purchase Contract, such Purchase Contract shall
       not entitle the Holder of the related Stripped Units Certificates to any
       of the rights of a holder of shares of Common Stock, including, without
       limitation, the right to vote or receive any dividends or other payments
       or to consent or to receive notice as stockholders in respect of the
       meetings of stockholders or for the election of directors of the Company
       or for any other matter, or any other rights whatsoever as stockholders
       of the Company.

       SECTION 3.3 EXECUTION, AUTHENTICATION, DELIVERY AND DATING.

              (a) Subject to the provisions of Sections 3.13 and 3.14, upon the
       execution and delivery of this Agreement, and at any time and from time
       to time

                                       22
<PAGE>

       thereafter, the Company may deliver Certificates executed by the Company
       to the Agent for authentication, execution on behalf of the Holders and
       delivery, together with its Issuer Order for authentication of such
       Certificates, and the Agent in accordance with such Issuer Order shall
       authenticate, execute on behalf of the Holders and deliver such
       Certificates.

              (b) The Certificates shall be executed on behalf of the Company by
       the Chief Executive Officer, the Chief Financial Officer, the President,
       any Vice-President, the Treasurer, any Assistant Treasurer, the Secretary
       or any Assistant Secretary (or other officer performing similar
       functions) of the Company and delivered to the Agent. The signature of
       any of these officers on the Certificates may be manual or facsimile.

              (c) Certificates 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 Certificates or did not hold such offices at the date of such
       Certificates.

              (d) No Purchase Contract evidenced by a Certificate shall be valid
       until such Certificate has been executed on behalf of the Holder by the
       manual signature of an authorized signatory of the Agent, as such
       Holder's attorney-in-fact. Such signature by an authorized signatory of
       the Agent shall be conclusive evidence that the Holder of such
       Certificate has entered into the Purchase Contract or Purchase Contracts
       evidenced by such Certificate.

              (e) Each Certificate shall be dated the date of its
       authentication.

              (f) No Certificate shall be entitled to any benefit under this
       Agreement or be valid or obligatory for any purpose unless there appears
       on such Certificate a certificate of authentication substantially in the
       form provided for herein executed by an authorized signatory of the Agent
       by manual signature, and such certificate upon any Certificate shall be
       conclusive evidence, and the only evidence, that such Certificate has
       been duly authenticated and delivered hereunder.

       SECTION 3.4 TEMPORARY CERTIFICATES.

              (a) Pending the preparation of definitive Certificates, the
       Company shall execute and deliver to the Agent, and the Agent shall
       authenticate, execute on behalf of the Holders, and deliver, in lieu of
       such definitive Certificates, temporary Certificates which are in
       substantially the form set forth in Exhibit A or Exhibit B hereto, as the
       case may be, with such letters, numbers or other marks of identification
       or designation and such legends or endorsements printed, lithographed or
       engraved thereon as may be required by the rules of any securities
       exchange on which the Normal Units or Stripped Units, as the case may be,
       are

                                       23
<PAGE>

       listed, or as may, consistent herewith, be determined by the officers of
       the Company executing such Certificates, as evidenced by their execution
       of the Certificates.

              (b) If temporary Certificates are issued, the Company will cause
       definitive Certificates to be prepared without unreasonable delay. After
       the preparation of definitive Certificates, the temporary Certificates
       shall be exchangeable for definitive Certificates upon surrender of the
       temporary Certificates at the Corporate Trust Office, at the expense of
       the Company and without charge to the Holder. Upon surrender for
       cancellation of any one or more temporary Certificates, the Company shall
       execute and deliver to the Agent, and the Agent shall authenticate,
       execute on behalf of the Holder, and deliver in exchange therefor, one or
       more definitive Certificates of like tenor and denominations and
       evidencing a like number of Normal Units or Stripped Units, as the case
       may be, as the temporary Certificate or Certificates so surrendered.
       Until so exchanged, the temporary Certificates shall in all respects
       evidence the same benefits and the same obligations with respect to the
       Normal Units or Stripped Units, as the case may be, evidenced thereby as
       definitive Certificates.

       SECTION 3.5 REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE.

              (a) The Agent shall keep at the Corporate Trust Office a register
       (the "Normal Units Register") in which, subject to such reasonable
       regulations as it may prescribe, the Agent shall provide for the
       registration of Normal Units Certificates and of transfers of Normal
       Units Certificates (the Agent, in such capacity, the "Normal Units
       Registrar") and a register (the "Stripped Units Register") in which,
       subject to such reasonable regulations as it may prescribe, the Agent
       shall provide for the registration of the Stripped Units Certificates and
       transfers of Stripped Units Certificates (the Agent, in such capacity,
       the "Stripped Units Registrar").

              (b) Upon surrender for registration of transfer of any Certificate
       at the Corporate Trust Office, the Company shall execute and deliver to
       the Agent, and the Agent shall authenticate, execute on behalf of the
       designated transferee or transferees, and deliver, in the name of the
       designated transferee or transferees, one or more new Certificates of
       like tenor and denominations, and evidencing a like number of Normal
       Units or Stripped Units, as the case may be.

              (c) At the option of the Holder, Certificates may be exchanged for
       other Certificates, of like tenor and denominations and evidencing a like
       number of Normal Units or Stripped Units, as the case may be, upon
       surrender of the Certificates to be exchanged at the Corporate Trust
       Office. Whenever any Certificates are so surrendered for exchange, the
       Company shall execute and deliver to the Agent, and the Agent shall
       authenticate, execute on behalf of the

                                       24
<PAGE>

       Holder, and deliver the Certificates which the Holder making the exchange
       is entitled to receive.

              (d) All Certificates issued upon any registration of transfer or
       exchange of a Certificate shall evidence the ownership of the same number
       of Normal Units or Stripped Units, as the case may be, and be entitled to
       the same benefits and subject to the same obligations, under this
       Agreement as the Normal Units or Stripped Units, as the case may be,
       evidenced by the Certificate surrendered upon such registration of
       transfer or exchange.

              (e) Every Certificate presented or surrendered for registration of
       transfer or for exchange shall (if so required by the Agent) be duly
       endorsed, or be accompanied by a written instrument of transfer in form
       satisfactory to the Company and the Agent duly executed, by the Holder
       thereof or its attorney duly authorized in writing.

              (f) No service charge shall be made for any registration of
       transfer or exchange of a Certificate, but the Company and the Agent may
       require payment from the Holder 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 Certificates, other than any
       exchanges pursuant to Sections 3.6, 3.9 and 8.5 not involving any
       transfer.

              (g) Notwithstanding the foregoing, the Company shall not be
       obligated to execute and deliver to the Agent, and the Agent shall not be
       obligated to authenticate, execute on behalf of the Holder and deliver
       any Certificate presented or surrendered for registration of transfer or
       for exchange on or after the third Business Day immediately preceding the
       earlier of the Stock Purchase Date or the Termination Date. In lieu of
       delivery of a new Certificate, upon satisfaction of the applicable
       conditions specified above in this Section and receipt of appropriate
       registration or transfer instructions from such Holder, the Agent shall,

                     (i) if the Stock Purchase Date has occurred, deliver the
              shares of Common Stock issuable in respect of the Purchase
              Contracts forming a part of the Units evidenced by such
              Certificate to the Holder,

                     (ii) in the case of Normal Units, if a Termination Event
              shall have occurred prior to the Stock Purchase Date, transfer the
              Debentures or the appropriate Treasury Consideration, as
              applicable, relating to such Normal Units to the Holder, or

                     (iii) in the case of Stripped Units, if a Termination Event
              shall have occurred prior to the Stock Purchase Date, transfer the
              Treasury Securities relating to such Stripped Units to the Holder,

                                       25
<PAGE>

       in each case subject to the applicable conditions and in accordance with
       the applicable provisions of Article V.

       SECTION 3.6 BOOK-ENTRY INTERESTS.

              The Certificates, on original issuance, will be issued in the form
of one or more, fully registered Global Certificates, to be delivered to the
Depositary by, or on behalf of, the Company. Such Global Certificate shall
initially be registered on the books and records of the Company in the name of
Cede & Co., the nominee of the Depositary, and no Beneficial Owner will receive
a definitive Certificate representing such Beneficial Owner's interest in such
Global Certificate, except as provided in Section 3.9. The Agent shall enter
into an agreement with the Depositary if so requested by the Company. Unless and
until definitive, fully registered Certificates have been issued to Beneficial
Owners pursuant to Section 3.9:

              (a) the provisions of this Section 3.6 shall be in full force and
       effect;

              (b) the Company and the Agent shall be entitled to deal with the
       Registered Holder for all purposes of this Agreement (including receiving
       approvals, votes or consents hereunder) as the Holder of the Units and
       the sole holder of the Global Certificate(s) and shall have no obligation
       to the Beneficial Owners;

              (c) to the extent that the provisions of this Section 3.6 conflict
       with any other provisions of this Agreement, the provisions of this
       Section 3.6 shall control; and

              (d) the rights of the Beneficial Owners shall be exercised only
       through the Clearing Agency and shall be limited to those established by
       law and agreements between such Beneficial Owners and the Clearing Agency
       and/or the Clearing Agency Participants. The Clearing Agency will make
       book-entry transfers among Clearing Agency Participants.

       SECTION 3.7 NOTICES TO HOLDERS.

              Whenever a notice or other communication to the Holders is
required to be given under this Agreement, the Company or the Company's agent
shall give such notices and communications to the Holders and, with respect to
any Units registered in the name of a Clearing Agency or the nominee of a
Clearing Agency, the Company or the Company's agent shall, except as set forth
herein, have no obligations to the Beneficial Owners.

                                       26
<PAGE>

       SECTION 3.8 APPOINTMENT OF SUCCESSOR CLEARING AGENCY.

              If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Units, the Company may, in its sole
discretion, appoint a successor Clearing Agency with respect to the Units.

       SECTION 3.9 DEFINITIVE CERTIFICATES.

              If

                     (i) a Clearing Agency elects to discontinue its services as
              securities depositary with respect to the Units and a successor
              Clearing Agency is not appointed within 90 days after such
              discontinuance pursuant to Section 3.8,

                     (ii) the Company elects to terminate the book-entry system
              arrangements through the Clearing Agency with respect to the
              Units, or

                     (iii) there shall have occurred and be continuing a default
              by the Company in respect of its obligations under one or more
              Purchase Contracts,

              then upon surrender of the Global Certificates representing the
              Book-Entry Interests with respect to the Units by the Clearing
              Agency, accompanied by registration instructions, the Company
              shall cause definitive Certificates to be delivered to Beneficial
              Owners in accordance with the instructions of the Clearing Agency.
              The Company shall not be liable for any delay in delivery of such
              instructions and may conclusively rely on and shall be protected
              in relying on, such instructions.

       SECTION 3.10 MUTILATED, DESTROYED, LOST AND STOLEN CERTIFICATES.

              (a) If any mutilated Certificate is surrendered to the Agent, the
       Company shall execute and deliver to the Agent, and the Agent shall
       authenticate, execute on behalf of the Holder, and deliver in exchange
       therefor, a new Certificate at the cost of the Holder, evidencing the
       same number of Normal Units or Stripped Units, as the case may be, and
       bearing a Certificate number not contemporaneously outstanding.

              (b) If there shall be delivered to the Company and the Agent (i)
       evidence to their satisfaction of the destruction, loss or theft of any
       Certificate, and (ii) such security or indemnity at the cost of the
       Holder as may be required by them to hold each of them and any agent of
       any of them harmless, then, in the absence of notice to the Company or to
       a Responsible Officer of the Agent that such Certificate has been
       acquired by a bona fide purchaser, the Company shall

                                       27
<PAGE>

       execute and deliver to the Agent, and the Agent shall authenticate,
       execute on behalf of the Holder, and deliver to the Holder, in lieu of
       any such destroyed, lost or stolen Certificate, a new Certificate,
       evidencing the same number of Normal Units or Stripped Units, as the case
       may be, and bearing a Certificate number not contemporaneously
       outstanding.

              (c) Notwithstanding the foregoing, the Company shall not be
       obligated to execute and deliver to the Agent, and the Agent shall not be
       obligated to authenticate, execute on behalf of the Holder, and deliver
       to the Holder, a Certificate on or after the third Business Day
       immediately preceding the earlier of the Stock Purchase Date or the
       Termination Date. In lieu of delivery of a new Certificate, upon
       satisfaction of the applicable conditions specified above in this Section
       and receipt of appropriate registration or transfer instructions from
       such Holder, the Agent shall (i) if the Stock Purchase Date has occurred,
       deliver to the Holder the shares of Common Stock issuable in respect of
       the Purchase Contracts forming a part of the Units evidenced by such
       Certificate, or (ii) if a Termination Event shall have occurred prior to
       the Stock Purchase Date, transfer to the Holder the Debentures, the
       appropriate Treasury Consideration or the Treasury Securities, as the
       case may be, evidenced thereby, in each case subject to the applicable
       conditions and in accordance with the applicable provisions of Article
       Five.

              (d) Upon the issuance of any new Certificate under this Section,
       the Company and the Agent may require the payment by the Holder 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 Agent) connected therewith.

              (e) Every new Certificate issued pursuant to this Section in lieu
       of any destroyed, lost or stolen Certificate shall constitute an original
       additional contractual obligation of the Company and of the Holder in
       respect of the Unit evidenced thereby, whether or not the destroyed, lost
       or stolen Certificate (and the Units evidenced thereby) shall be at any
       time enforceable by anyone, and shall be entitled to all the benefits and
       be subject to all the obligations of this Agreement equally and
       proportionately with any and all other Certificates delivered hereunder.

              (f) 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 Certificates.

       SECTION 3.11 PERSONS DEEMED OWNERS.

              (a) Prior to due presentment of a Certificate for registration of
       transfer, the Company and the Agent, and any agent of the Company or the
       Agent, may

                                       28
<PAGE>

       treat the Person in whose name such Certificate is registered as the
       owner of the Units evidenced thereby, for the purpose of receiving
       interest payments on the Debentures, performance of the Purchase
       Contracts and for all other purposes whatsoever, whether or not any such
       payments shall be overdue and notwithstanding any notice to the contrary,
       and neither the Company nor the Agent, nor any agent of the Company or
       the Agent, shall be affected by notice to the contrary.

              (b) Notwithstanding the foregoing, with respect to any Global
       Certificate, nothing herein shall prevent the Company, the Agent or any
       agent of the Company or the Agent, from giving effect to any written
       certification, proxy or other authorization furnished by any Clearing
       Agency (or its nominee), as a Holder, with respect to such Global
       Certificate or impair, as between such Clearing Agency and owners of
       beneficial interests in such Global Certificate, the operation of
       customary practices governing the exercise of rights of such Clearing
       Agency (or its nominee) as Holder of such Global Certificate.

       SECTION 3.12 CANCELLATION.

              (a) All Certificates surrendered (i) for delivery of shares of
       Common Stock on or after any Settlement Date; (ii) upon the transfer of
       Debentures, the appropriate Treasury Consideration or Treasury
       Securities, as the case may be, after the occurrence of a Termination
       Event or pursuant to an Early Settlement or Merger Early Settlement, or a
       Collateral Substitution or an establishment or re-establishment of a
       Normal Unit; or (iii) upon the registration of a transfer or exchange of
       a Unit shall, if surrendered to any Person other than the Agent, be
       delivered to the Agent and, if not already cancelled, shall be promptly
       cancelled by it. The Company may at any time deliver to the Agent for
       cancellation any Certificates previously authenticated, executed and
       delivered hereunder which the Company may have acquired in any manner
       whatsoever, and all Certificates so delivered shall, upon Issuer Order,
       be promptly cancelled by the Agent. No Certificates shall be
       authenticated, executed on behalf of the Holder and delivered in lieu of
       or in exchange for any Certificates cancelled as provided in this
       Section, except as expressly permitted by this Agreement. All cancelled
       Certificates held by the Agent shall be disposed of by the Agent in
       accordance with its then customary procedures.

              (b) If the Company or any Affiliate of the Company shall acquire
       any Certificate, such acquisition shall not operate as a cancellation of
       such Certificate unless and until such Certificate is delivered to the
       Agent cancelled or for cancellation.

                                       29
<PAGE>

       SECTION 3.13 ESTABLISHMENT OF STRIPPED UNITS.

              (a) A Holder may separate the Pledged Debentures or Pledged
       Treasury Consideration, as applicable, from the related Purchase
       Contracts in respect of the Normal Units held by such Holder by
       substituting for such Pledged Debentures or Pledged Treasury
       Consideration, as the case may be, Treasury Securities that will pay at
       maturity an amount equal to the aggregate Stated Amount of such Normal
       Units (a "Collateral Substitution"), at any time from and after the date
       of this Agreement and on or prior to the fourth Business Day immediately
       preceding the Stock Purchase Date, by (i) depositing with the Collateral
       Agent Treasury Securities having an aggregate principal amount equal to
       the aggregate Stated Amount of such Normal Units, and (ii) transferring
       the related Normal Units to the Agent accompanied by a notice to the
       Agent, substantially in the form of Exhibit D hereto, stating that the
       Holder has transferred the relevant amount of Treasury Securities to the
       Collateral Agent and requesting that the Agent instruct the Collateral
       Agent to release the Pledged Debentures or Pledged Treasury
       Consideration, as the case may be, underlying such Normal Units,
       whereupon the Agent shall promptly give such instruction to the
       Collateral Agent, substantially in the form of Exhibit C hereto.
       Notwithstanding the foregoing, a Holder may not separate the Pledged
       Debentures or Pledged Treasury Consideration, as the case may be, from
       the related Purchase Contracts in respect of the Normal Units held by
       such Holder during the periods beginning on the fourth Business Day prior
       to the Remarketing Date or any Subsequent Remarketing Date, as the case
       may be, and ending on the third Business Day following such dates. Upon
       receipt of the Treasury Securities described in clause (i) above and the
       instruction described in clause (ii) above, in accordance with the terms
       of the Pledge Agreement, the Collateral Agent will release to the Agent,
       on behalf of the Holder, such Pledged Debentures or Pledged Treasury
       Consideration, as the case may be, from the Pledge, free and clear of the
       Company's security interest therein, and upon receipt thereof the Agent
       shall promptly:

                     (x) cancel the related Normal Units;

                     (y) transfer the Pledged Debentures or Pledged Treasury
              Consideration, as the case may be, to the Holder; and

                     (z) authenticate, execute on behalf of such Holder and
              deliver a Stripped Units Certificate executed by the Company in
              accordance with Section 3.3 evidencing the same number of Purchase
              Contracts as were evidenced by the cancelled Normal Units.

              (b) Holders who elect to separate the Pledged Debentures or
       Pledged Treasury Consideration, as the case may be, from the related
       Purchase Contract and to substitute Treasury Securities for such Pledged
       Debentures or Pledged

                                       30
<PAGE>

       Treasury Consideration, as the case may be, shall be responsible for any
       fees or expenses payable to the Collateral Agent for its services as
       Collateral Agent in respect of the substitution, and the Company shall
       not be responsible for any such fees or expenses.

              (c) Holders may make Collateral Substitutions (i) if Treasury
       Securities are being substituted for Pledged Debentures, only in integral
       multiples of 40 Normal Units, or (ii) if the Collateral Substitutions
       occur after a Tax Event Redemption or a successful remarketing of the
       Debentures pursuant to the terms of Section 5.2 of this Agreement, as the
       case may be, only in integral multiples of Normal Units such that the
       Treasury Securities to be deposited and the Treasury Consideration to be
       released are in integral multiples of $1,000.

              (d) In the event a Holder making a Collateral Substitution
       pursuant to this Section 3.13 fails to effect a book-entry transfer of
       the Normal Units or fails to deliver a Normal Units Certificate to the
       Agent after depositing Treasury Securities with the Collateral Agent, the
       Pledged Debentures or Pledged Treasury Consideration, as the case may be,
       constituting a part of such Normal Units, and any distributions on such
       Pledged Debentures or Pledged Treasury Consideration, as the case may be,
       shall be held in the name of the Agent or its nominee in trust for the
       benefit of such Holder, until such Normal Units are so transferred or the
       Normal Units Certificate is so delivered, as the case may be, or, with
       respect to a Normal Units Certificate, such Holder provides evidence
       satisfactory to the Company and the Agent that such Normal Units
       Certificate has been destroyed, lost or stolen, together with any
       indemnity that may be required by the Agent and the Company.

              (e) Except as described in this Section 3.13, for so long as the
       Purchase Contract underlying a Normal Unit remains in effect, such Normal
       Unit shall not be separable into its constituent parts, and the rights
       and obligations of the Holder of such Normal Unit in respect of the
       Debenture or the appropriate Treasury Consideration, as the case may be,
       and the Purchase Contract comprising such Normal Unit may be acquired,
       and may be transferred and exchanged, only as a Normal Unit.

       SECTION 3.14 REESTABLISHMENT OF NORMAL UNITS.

              (a) A Holder of Stripped Units may reestablish Normal Units at any
       time from and after the date of this Agreement and on or prior to the
       fourth Business Day immediately preceding the Stock Purchase Date, by (i)
       depositing with the Collateral Agent the Debentures or the appropriate
       Treasury Consideration (identified and calculated by reference to the
       Treasury Consideration then comprising Normal Units), as the case may be,
       then comprising such number of Normal Units as is equal to the number of
       such Stripped Units and (ii) transferring such Stripped Units to the
       Agent accompanied

                                       31
<PAGE>

       by a notice to the Agent, substantially in the form of Exhibit D hereto,
       stating that the Holder has transferred the relevant amount of Debentures
       or the appropriate Treasury Consideration, as the case may be, to the
       Collateral Agent and requesting that the Agent instruct the Collateral
       Agent to release the Pledged Treasury Securities underlying such Stripped
       Unit, whereupon the Agent shall promptly give such instruction to the
       Collateral Agent, substantially in the form of Exhibit C hereto.
       Notwithstanding the foregoing, a Holder may not reestablish Normal Units
       during the periods beginning on the fourth Business Day prior to the
       Remarketing Date or any Subsequent Remarketing Date, as the case may be,
       and ending on the third Business Day following such dates. Upon receipt
       of the Debentures or the appropriate Treasury Consideration, as the case
       may be, described in clause (i) above and the instruction described in
       clause (ii) above, in accordance with the terms of the Pledge Agreement,
       the Collateral Agent will release to the Agent, on behalf of the Holder,
       such Pledged Treasury Securities from the Pledge, free and clear of the
       Company's security interest therein, and upon receipt thereof the Agent
       shall promptly:

                     (x) cancel the related Stripped Units;

                     (y) transfer the Pledged Treasury Securities to the Holder;
              and

                     (z) authenticate, execute on behalf of such Holder and
              deliver a Normal Units Certificate executed by the Company in
              accordance with Section 3.3 evidencing the same number of Purchase
              Contracts as were evidenced by the cancelled Stripped Units.

              (b) Holders of Stripped Units may reestablish Normal Units (i)
       only in integral multiples of 40 Stripped Units for 40 Normal Units or
       (ii) if the reestablishment occurs after a Tax Event Redemption or a
       successful remarketing of the Debentures pursuant to Section 5.2 of this
       Agreement, only in integral multiples of Stripped Units such that the
       Treasury Consideration to be deposited and the Treasury Securities to be
       released are in integral multiples of $1,000.

              (c) Except as provided in this Section 3.14, for so long as the
       Purchase Contract underlying a Stripped Unit remains in effect, such
       Stripped Unit shall not be separable into its constituent parts, and the
       rights and obligations of the Holder of such Stripped Unit in respect of
       the Treasury Security and Purchase Contract comprising such Stripped Unit
       may be acquired, and may be transferred and exchanged, only as a Stripped
       Unit.

       SECTION 3.15 TRANSFER OF COLLATERAL UPON OCCURRENCE OF TERMINATION EVENT.

              Upon the occurrence of a Termination Event and the transfer to the
Agent of the Debentures, the appropriate Treasury Consideration or the Treasury
Securities, as the case may be, underlying the Normal Units and the Stripped
Units pursuant to the

                                       32
<PAGE>

terms of the Pledge Agreement, the Agent shall request transfer instructions
with respect to such Debentures or the appropriate Treasury Consideration or
Treasury Securities, as the case may be, from each Holder by written request
mailed to such Holder at its address as it appears in the Normal Units Register
or the Stripped Units Register, as the case may be. Upon book-entry transfer of
the Normal Units or Stripped Units or delivery of a Normal Units Certificate or
Stripped Units Certificate to the Agent with such transfer instructions, the
Agent shall transfer the Debentures, the appropriate Treasury Consideration or
Treasury Securities, as the case may be, underlying such Normal Units or
Stripped Units, as the case may be, to such Holder by book-entry transfer, or
other appropriate procedures, in accordance with such instructions. In the event
a Holder of Normal Units or Stripped Units fails to effect such transfer or
delivery, the Debentures, the appropriate Treasury Consideration or Treasury
Securities, as the case may be, underlying such Normal Units or Stripped Units,
as the case may be, and any distributions thereon, shall be held in the name of
the Agent or its nominee in trust for the benefit of such Holder, until such
Normal Units or Stripped Units are transferred or the Normal Units Certificate
or Stripped Units Certificate is surrendered or such Holder provides
satisfactory evidence that such Normal Units Certificate or Stripped Units
Certificate has been destroyed, lost or stolen, together with any indemnity that
may be required by the Agent and the Company.

       SECTION 3.16 NO CONSENT TO ASSUMPTION.

              Each Holder of a Unit, by acceptance thereof, shall be deemed
expressly to have withheld any consent to the assumption, under Section 365 of
the Bankruptcy Code or otherwise, of the Purchase Contract by the Company, any
receiver, liquidator or person or entity performing similar functions or its
trustee in the event that the Company becomes the debtor under the Bankruptcy
Code or subject to other similar state or federal law providing for
reorganization or liquidation.

                                   ARTICLE IV

                                 THE DEBENTURES

       SECTION 4.1 PAYMENT OF INTEREST; RIGHTS TO INTEREST PAYMENTS PRESERVED;
                   NOTICE.

              (a) A payment on any Debenture or Treasury Consideration, as the
       case may be, which is paid on any Payment Date shall, subject to receipt
       thereof by the Agent from the Collateral Agent as provided by the terms
       of the Pledge Agreement, be paid to the Person in whose name the Normal
       Units Certificate (or one or more Predecessor Normal Units Certificates)
       of which such Debenture or the appropriate Treasury Consideration, as the
       case may be, is a part is registered at the close of business on the
       Record Date for such Payment Date.

                                       33
<PAGE>

              (b) Each Normal Units Certificate evidencing Debentures delivered
       under this Agreement upon registration of transfer of or in exchange for
       or in lieu of any other Normal Units Certificate shall carry the rights
       to interest accrued and unpaid, which were carried by the Debentures
       underlying such other Normal Units Certificate.

              (c) In the case of any Normal Unit with respect to which Early
       Settlement of the underlying Purchase Contract is effected on an Early
       Settlement Date, or with respect to which Merger Early Settlement of the
       underlying Purchase Contract is effected on a Merger Early Settlement
       Date, or with respect to which a Collateral Substitution is effected, in
       each case on a date that is after any Record Date and on or prior to the
       next succeeding Payment Date, payments on the Debenture or the
       appropriate Treasury Consideration, as the case may be, underlying such
       Normal Unit otherwise payable on such Payment Date shall be payable on
       such Payment Date notwithstanding such Early Settlement, Merger Early
       Settlement or Collateral Substitution, as the case may be, and such
       payments shall, subject to receipt thereof by the Agent, be payable to
       the Person in whose name the Normal Units Certificate (or one or more
       Predecessor Normal Unit Certificates) was registered at the close of
       business on such Record Date. Except as otherwise expressly provided in
       the immediately preceding sentence, in the case of any Normal Unit with
       respect to which Early Settlement or Merger Early Settlement of the
       underlying Purchase Contract is effected, or with respect to which a
       Collateral Substitution has been effected, payments on the related
       Debentures or payments on the appropriate Treasury Consideration, as the
       case may be, that would otherwise be payable after the applicable
       Settlement Date or after such Collateral Substitution, as the case may
       be, shall not be payable hereunder to the Holder of such Normal Unit;
       provided, that to the extent that such Holder continues to hold the
       separated Debentures that formerly comprised a part of such Holder's
       Normal Units, such Holder shall be entitled to receive any payments on
       such separated Debentures.

       SECTION 4.2 NOTICE AND VOTING.

              Under the terms of the Pledge Agreement, the Agent will be
entitled to exercise the voting and any other consensual rights pertaining to
the Pledged Debentures but only to the extent instructed by the Holders as
described below. Upon receipt of notice of any meeting at which holders of
Debentures are entitled to vote or upon any solicitation of consents, waivers or
proxies of holders of Debentures, the Agent shall, as soon as practicable
thereafter, mail to the Holders of Normal Units a notice (a) containing such
information as is contained in the notice or solicitation, (b) stating that each
Holder on the record date set by the Agent therefor (which, to the extent
possible, shall be the same date as the record date for determining the holders
of Debentures entitled to vote) shall be entitled to instruct the Agent as to
the exercise of the voting rights pertaining to the Pledged Debentures
underlying their Normal Units and (c) stating the manner in which such
instructions may be given. Upon the written request of the Holders of Normal

                                       34
<PAGE>

Units on such record date, the Agent shall endeavor insofar as practicable to
vote or cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of Pledged Debentures as to which any particular
voting instructions are received. In the absence of specific instructions from
the Holder of a Normal Unit, the Agent shall abstain from voting the Pledged
Debenture underlying such Normal Unit. The Company hereby agrees, if applicable,
to solicit Holders of Normal Units to timely instruct the Agent in order to
enable the Agent to vote such Pledged Debentures.

       SECTION 4.3 TAX EVENT REDEMPTION.

              Upon the occurrence of a Tax Event Redemption prior to the
successful remarketing of the Debentures pursuant to the provisions of Section
5.2 of this Agreement, pursuant to the terms of the Pledge Agreement, the
Collateral Agent will apply out of the aggregate Redemption Price for the
Debentures that are components of the Normal Units, an amount equal to the
aggregate Redemption Amount for the Debentures that are components of the Normal
Units to purchase on behalf of the Holders of Normal Units, on a pro rata basis,
the Redemption Treasury Portfolio and promptly remit the remaining portion of
such Redemption Price, if any, to the Agent for payment to the Holders of such
Normal Units on a pro rata basis. The Redemption Treasury Portfolio will be
substituted for the Pledged Debentures, and will be held by the Collateral Agent
in accordance with the terms of the Pledge Agreement to secure the obligation of
each Holder of a Normal Unit to purchase the Common Stock of the Company under
the Purchase Contract constituting a part of such Normal Unit. Following the
occurrence of a Tax Event Redemption prior to the successful remarketing of the
Debentures pursuant to the provisions of Section 5.2 of this Agreement, the
Holders of Normal Units and the Collateral Agent shall have such security
interests, rights and obligations with respect to the Redemption Treasury
Portfolio as the Holder of Normal Units and the Collateral Agent had in respect
of the Debentures subject to the Pledge thereof as provided in Articles II, III,
IV, V, and VI of the Pledge Agreement, and any reference herein or in the
Certificates to the Debentures shall be deemed to be reference to such
Redemption Treasury Portfolio and any reference herein or in the Certificates to
interest on the Debentures shall be deemed to be reference to corresponding
distributions on the Redemption Treasury Portfolio. The Company may cause to be
made in any Normal Unit Certificates thereafter to be issued such change in
phraseology and form (but not in substance) as may be appropriate to reflect the
substitution of the Redemption Treasury Portfolio for Debentures as collateral.

                                       35
<PAGE>

                                    ARTICLE V

                     THE PURCHASE CONTRACTS; THE REMARKETING

       SECTION 5.1 PURCHASE OF SHARES OF COMMON STOCK.

              (a) Each Purchase Contract shall, unless an Early Settlement has
       occurred in accordance with Section 5.7, or a Merger Early Settlement has
       occurred in accordance with Section 5.8, obligate the Holder of the
       related Unit to purchase, and the Company to sell, on the Stock Purchase
       Date at a price equal to $25 (the "Purchase Price"), a number of newly
       issued shares of Common Stock equal to the Settlement Rate unless, on or
       prior to the Stock Purchase Date, there shall have occurred a Termination
       Event with respect to the Unit of which such Purchase Contract is a part.
       The "Settlement Rate" is equal to,

                     (i) if the Applicable Market Value (as defined below) is
              equal to or greater than $11.58 (the "Threshold Appreciation
              Price"), 2.1597 shares of Common Stock per Purchase Contract,

                     (ii) if the Applicable Market Value is less than the
              Threshold Appreciation Price, but is greater than $9.81, the
              number of shares of Common Stock per Purchase Contract equal to
              the Stated Amount of the related Unit divided by the Applicable
              Market Value, and

                     (iii) if the Applicable Market Value is equal to or less
              than $9.81, 2.5484 shares of Common Stock per Purchase Contract,

       in each case subject to adjustment as provided in Section 5.4 (and in
       each case rounded upward or downward to the nearest 1/10,000th of a
       share).

              (b) The "Applicable Market Value" means the average of the Closing
       Price per share of Common Stock on, if applicable, each of the 20
       consecutive Trading Days ending on the third Trading Day immediately
       preceding the Stock Purchase Date (or, in the event of a Cash Merger
       contemplated by Section 5.8, ending on the third Trading Day immediately
       preceding the date of the consummation of the Cash Merger). The "Closing
       Price" of the Common Stock on any date of determination means the closing
       sale price (or, if no closing price is reported, the last reported sale
       price) of the Common Stock on the New York Stock Exchange (the "NYSE") on
       such date or, if the Common Stock is not listed for trading on the NYSE
       on any such date, as reported in the composite transactions for the
       principal United States securities exchange on which the Common Stock is
       so listed, or if the Common Stock is not so listed on a United States
       national or regional securities exchange, as reported by The Nasdaq Stock
       Market, or, if the Common Stock is not so reported, the last quoted bid
       price for the Common Stock in the over-the-counter market as reported by
       the National Quotation Bureau or similar organization, or, if such bid
       price is not available, the

                                       36
<PAGE>

       market value of the Common Stock on such date as determined by a
       nationally recognized independent investment banking firm retained for
       this purpose by the Company. A "Trading Day" means a day on which the
       Common Stock (A) is not suspended from trading on any national or
       regional securities exchange or association or over-the-counter market at
       the close of business and (B) has traded at least once on the national or
       regional securities exchange or association or over-the-counter market
       that is the primary market for the trading of the Common Stock.

              (c) Each Holder of a Unit, by its acceptance thereof, irrevocably
       authorizes the Agent to enter into and perform the related Purchase
       Contract on its behalf as its attorney-in-fact (including the execution
       of Certificates on behalf of such Holder), agrees to be bound by the
       terms and provisions thereof, covenants and agrees to perform its
       obligations under such Purchase Contracts, and consents to the provisions
       hereof, irrevocably authorizes the Agent as its attorney-in-fact to enter
       into and perform the Pledge Agreement on its behalf as its
       attorney-in-fact, and consents to and agrees to be bound by the Pledge of
       the Debentures, the appropriate Treasury Consideration or the Treasury
       Securities pursuant to the Pledge Agreement; provided that upon a
       Termination Event, the rights of the Holder of such Unit under the
       Purchase Contract may be enforced without regard to any other rights or
       obligations. Each Holder of a Unit, by its acceptance thereof, further
       covenants and agrees, that, to the extent and in the manner provided in
       Section 5.2 and the Pledge Agreement, but subject to the terms thereof,
       payments in respect of the Debentures, the appropriate Treasury
       Consideration or the Treasury Securities to be paid upon settlement of
       such Holder's obligations to purchase Common Stock under the Purchase
       Contract, shall be paid on the Stock Purchase Date by the Collateral
       Agent to the Company in satisfaction of such Holder's obligations under
       such Purchase Contract.

                     (i) Upon registration of transfer of a Certificate, the
              transferee shall be bound (without the necessity of any other
              action on the part of such transferee) under the terms of this
              Agreement, the Purchase Contracts underlying such Certificate and
              the Pledge Agreement, and the transferor shall be released from
              the obligations under this Agreement, the Purchase Contracts
              underlying the Certificates so transferred and the Pledge
              Agreement. The Company covenants and agrees, and each Holder of a
              Certificate, by its acceptance thereof, likewise covenants and
              agrees, to be bound by the provisions of this paragraph.

       SECTION 5.2 PAYMENT OF PURCHASE PRICE; REMARKETING.

              (a) Unless a Tax Event Redemption or a Termination Event has
       occurred or a Holder of a Unit has settled the underlying Purchase
       Contract through an Early Settlement pursuant to Section 5.7 or a Merger
       Early Settlement

                                       37
<PAGE>

       pursuant to Section 5.8, the settlement of the Purchase Contract
       underlying a Unit will be made in accordance with this Section 5.2.

              (b) (i) The Company shall engage a nationally recognized
       investment bank (the "Remarketing Agent") pursuant to a Remarketing
       Agreement to be mutually agreed on by the Company, the Agent and the
       Remarketing Agent, but providing for remarketing procedures substantially
       as set forth below to sell the Debentures of Holders of Normal Units,
       other than Holders that have elected not to participate in the
       remarketing pursuant to clause (iv) below, and holders of Separate
       Debentures that have elected to participate in the remarketing. On the
       seventh day prior to August 15, 2004, the Company shall give Holders of
       Normal Units and holders of Separate Debentures notice of the remarketing
       in a daily newspaper in the English language of general circulation in
       The City of New York (which shall be The Wall Street Journal, if such
       newspaper is then so published) and the Agent shall give to Holders of
       Normal Units and holders of Separate Debentures notice of the remarketing
       through the facilities of DTC. Such notice shall include the specific
       U.S. Treasury security or securities (including the CUSIP number and/or
       the principal terms of such Treasury security or securities) described in
       clause (iv) below, that must be delivered by Holders of Normal Units that
       elect not to participate in the remarketing pursuant to clause (iv) below
       no later than 10:00 a.m. on the fourth Business Day preceding the
       Remarketing Date. The Agent shall notify, by 10:00 a.m., New York City
       time, on the third Business Day preceding the Remarketing Date, the
       Remarketing Agent and the Collateral Agent of the aggregate number of
       Debentures of Normal Unit Holders to be remarketed. On the third Business
       Day preceding the Remarketing Date, no later than by 10:00 a.m. New York
       City time, pursuant to the terms of the Pledge Agreement, the Custodial
       Agent will notify the Remarketing Agent of the aggregate number of
       Separate Debentures to be remarketed. On the Business Day immediately
       preceding the Remarketing Date, the Collateral Agent and the Custodial
       Agent, pursuant to the terms of the Pledge Agreement, will deliver for
       remarketing to the Remarketing Agent all Debentures to be remarketed.
       Upon receipt of such notice from the Agent and the Custodial Agent and
       such Debentures from the Collateral Agent and the Custodial Agent, the
       Remarketing Agent will, on the Remarketing Date, use its commercially
       reasonable best efforts to sell such Debentures on such date at a price
       equal to 100.5% of the Remarketing Value. The Remarketing Agent will use
       the proceeds from a successful remarketing to purchase the appropriate
       U.S. Treasury securities (the "Agent-purchased Treasury Consideration")
       with the CUSIP numbers, if any, selected by the Remarketing Agent,
       described in clauses (i)(1) and (ii)(1) of the definition of Remarketing
       Value related to the Debentures of Holders of Normal Units that were
       remarketed. On or prior to the third Business Day following the
       Remarketing Date, the Remarketing Agent shall deliver such
       Agent-purchased Treasury Consideration to the Agent, which shall
       thereupon deliver such Agent-purchased Treasury Consideration to the
       Collateral Agent. The Collateral Agent, for the benefit of the Company,
       will thereupon apply such

                                       38
<PAGE>

       Agent-purchased Treasury Consideration, in accordance with the Pledge
       Agreement, to secure such Holders' obligations under the Purchase
       Contracts. The Remarketing Agent will deduct as a remarketing fee an
       amount not exceeding 50 basis points (.50%) of the total proceeds from
       the remarketing (the "Remarketing Fee"). The Remarketing Agent will remit
       (1) the portion of the proceeds from the remarketing attributable to the
       Separate Debentures to the holders of Separate Debentures that were
       remarketed and (2) the remaining portion of the proceeds, less those
       proceeds used to purchase the Agent-purchased Treasury Consideration, to
       the Agent for the benefit of the Holders of the Normal Units that were
       remarketed, all determined on a pro rata basis, in each case, on or prior
       to the third Business Day following the Remarketing Date. Holders whose
       Debentures are so remarketed will not otherwise be responsible for the
       payment of any Remarketing Fee in connection therewith.

                     (ii) If, in spite of using its commercially reasonable best
              efforts, the Remarketing Agent cannot remarket the Debentures
              included in the remarketing at a price equal to at least 100.5% of
              the Remarketing Value, the remarketing will be deemed to have
              failed (a "Failed Remarketing"). If a Failed Remarketing occurs,
              within three Business Days following the Remarketing Date, the
              Remarketing Agent shall return any Debentures delivered to it to
              the Collateral Agent and the Custodial Agent, as applicable. The
              Remarketing Agent may make attempts to remarket the Debentures on
              each of the four consecutive Business Days ending on October 1,
              2004 and on the third Business Day immediately preceding the Stock
              Purchase Date (each a "Subsequent Remarketing") in accordance with
              the procedures set forth in this Section 5.2(b) and the
              Remarketing Agreement, provided that (i) the notice of any
              Subsequent Remarketing cannot be given until the Failed
              Remarketing notice (referred to below) has been published in
              respect of any immediately preceding Failed Remarketing and (ii)
              the settlement date in respect of any Subsequent Remarketing must
              fall no later than on the Business Day immediately preceding the
              Stock Purchase Date. If by 4:00 p.m., New York City time, on the
              third Business Day immediately preceding the Stock Purchase Date,
              the Remarketing Agent, in spite of using its commercially
              reasonable best efforts, has failed to remarket the Debentures at
              100.5% of the Remarketing Value in accordance with the terms of
              the Pledge Agreement, the "Last Failed Remarketing" will be deemed
              to have occurred. In this case, within three Business Days
              following the date of the Last Failed Remarketing, the Remarketing
              Agent shall return any Debentures delivered to it to the
              Collateral Agent. The Collateral Agent, for the benefit of the
              Company, may exercise its rights as a secured party with respect
              to such Debentures, including those actions specified in (b) (iii)
              below; provided, that if upon the Last Failed Remarketing, the
              Collateral Agent exercises such rights for the benefit of the
              Company with respect to such Debentures, any accumulated and

                                       39
<PAGE>

              unpaid interest on such Debentures will become payable by the
              Company to the Agent for payment to the Holders of the Normal
              Units to which such Debentures relate. Such payment will be made
              by the Company on or prior to 11:00 a.m., New York City time, on
              the Stock Purchase Date in lawful money of the United States by
              certified or cashier's check or wire transfer in immediately
              available funds payable to or upon the order of the Agent. The
              Company will cause a notice of any Failed Remarketing and of the
              Last Failed Remarketing to be published on the second Business Day
              following the Remarketing Date, each of the four consecutive
              Business Days ending on October 1, 2004 and the date of the Last
              Failed Remarketing, as the case may be, in a daily newspaper in
              the English language of general circulation in The City of New
              York, which shall be The Wall Street Journal, if such newspaper is
              then so published.

                     (iii) With respect to any Debentures which constitute part
              of Normal Units which are subject to the Last Failed Remarketing,
              the Collateral Agent for the benefit of the Company reserves all
              of its rights as a secured party with respect thereto and, subject
              to applicable law and Section 5.2 (e) below, may, among other
              things, (A) retain such Debentures in full satisfaction of the
              Holders' obligations under the Purchase Contracts or (B) sell such
              Debentures in one or more public or private sales or otherwise.

                     (iv) A Holder of Normal Units may elect not to participate
              in the remarketing and retain the Debentures underlying such Units
              by notifying the Agent of such election and delivering the
              specific U.S. Treasury security or securities (including the CUSIP
              number and/or the principal terms of such security or securities)
              identified by the Agent (as having been based solely on the
              identification that the Remarketing Agent shall have advised the
              Agent) that constitute the U.S. Treasury securities described in
              clauses (i) and (ii) of the definition of Remarketing Value
              relating to the retained Debentures (as if only such Debentures
              were being remarketed) (the "Opt-out Treasury Consideration") to
              the Agent not later than 10:00 a.m. on the fourth Business Day
              prior to the Remarketing Date (or, in the case of a Failed
              Remarketing, not later than 10:00 a.m. on the fourth Business Day
              immediately prior to the Subsequent Remarketing Date). Upon
              receipt thereof by the Agent, the Agent shall deliver such Opt-out
              Treasury Consideration to the Collateral Agent, which will, for
              the benefit of the Company, thereupon apply such Opt-out Treasury
              Consideration to secure such Holder's obligations under the
              Purchase Contracts. On the first Business Day immediately
              preceding the Remarketing Date or any Subsequent Remarketing Date,
              as applicable, the Collateral Agent, pursuant to the terms of the
              Pledge Agreement, will deliver the Pledged Debentures of such
              Holder to the Agent. Within three Business Days following the
              Remarketing Date or any Subsequent

                                       40
<PAGE>

              Remarketing Date, as applicable, (A) if the remarketing was
              successful, the Agent shall distribute such Debentures to the
              Holders thereof, and (B) if there was a Failed Remarketing on such
              date, the Agent will deliver such Debentures to the Collateral
              Agent, which will, for the benefit of the Company, thereupon apply
              such Debentures to secure such Holders' obligations under the
              Purchase Contract and return the Opt-out Treasury Consideration
              delivered by such Holders to such Holders. A Holder that does not
              so deliver the Opt-out Treasury Consideration pursuant to this
              clause (iv) shall be deemed to have elected to participate in the
              remarketing.

              (c) Upon the maturity of the Pledged Treasury Securities
       underlying the Stripped Units and the Pledged Treasury Consideration
       underlying the Normal Units, on the Stock Purchase Date, the Collateral
       Agent shall remit to the Company an amount equal to the aggregate
       Purchase Price applicable to such Units, as payment for the Common Stock
       issuable upon settlement thereof without needing to receive any
       instructions from the Holders of such Units. In the event the payments in
       respect of the Pledged Treasury Securities or the Pledged Treasury
       Consideration underlying a Unit is in excess of the Purchase Price of the
       Purchase Contract being settled thereby, the Collateral Agent will
       distribute such excess to the Agent for the benefit of the Holder of such
       Unit when received.

              (d) Any distribution to Holders of excess funds and interest
       described in Section 5.2 (b) and (c) above shall be payable at the office
       of the Agent in The City of New York maintained for that purpose or, at
       the option of the Holder or the holder of Separate Debentures, as
       applicable, by check mailed to the address of the Person entitled thereto
       at such address as it appears on the Register or by wire transfer to an
       account specified by the Holder or the holder of Separate Debentures, as
       applicable.

              (e) The obligations of each Holder to pay the Purchase Price are
       non-recourse obligations and, except to the extent paid by Early
       Settlement or Merger Early Settlement, are payable solely out of the
       proceeds of any Collateral pledged to secure the obligations of the
       Holders and in no event will Holders be liable for any deficiency between
       such payments and the Purchase Price.

              (f) Notwithstanding anything to the contrary herein, the Company
       shall not be obligated to issue any Common Stock in respect of a Purchase
       Contract or deliver any certificates therefor to the Holder of the
       related Unit unless the Company shall have received payment in full of
       the aggregate Purchase Price for the shares of Common Stock to be
       purchased thereunder by such Holder in the manner herein set forth;
       provided that the foregoing is not applicable if the Debentures are not
       successfully remarketed pursuant to this Section 5.2 and provided further
       that nothing is this paragraph (f) (including the preceding

                                       41
<PAGE>

       proviso) shall in any respect limit or impair the rights reserved to the
       Company pursuant to Section 5(b)(iii).

       SECTION 5.3 ISSUANCE OF SHARES OF COMMON STOCK.

              Unless a Termination Event shall have occurred on or prior to the
Stock Purchase Date or an Early Settlement or a Merger Early Settlement shall
have occurred, on the Stock Purchase Date, upon its receipt of payment in full
of the Purchase Price for the shares of Common Stock purchased by the Holders
pursuant to the foregoing provisions of this Article and subject to Section
5.4(b), the Company shall issue and deposit with the Agent, for the benefit of
the Holders of the Outstanding Units, one or more certificates representing the
newly issued shares of Common Stock, registered in the name of the Agent (or its
nominee) as custodian for the Holders (such certificates for shares of Common
Stock, together with any dividends or distributions for which a record date and
payment date for such dividend or distribution has occurred after the Stock
Purchase Date, being hereinafter referred to as the "Purchase Contract
Settlement Fund"), to which the Holders are entitled hereunder. Subject to the
foregoing, upon surrender of a Certificate to the Agent on or after the Stock
Purchase Date, together with settlement instructions thereon duly completed and
executed, the Holder of such Certificate shall be entitled to receive in
exchange therefor a certificate representing that number of whole shares of
Common Stock which such Holder is entitled to receive pursuant to the provisions
of this Article V (after taking into account all Units then held by such Holder)
together with cash in lieu of fractional shares as provided in Section 5.10 and
any dividends or distributions with respect to such shares constituting part of
the Purchase Contract Settlement Fund, but without any interest thereon, and the
Certificate so surrendered shall forthwith be cancelled. Such shares shall be
registered in the name of the Holder or the Holder's designee as specified in
the settlement instructions provided by the Holder to the Agent. If any shares
of Common Stock issued in respect of a Purchase Contract are to be registered to
a Person other than the Person in whose name the Certificate evidencing such
Purchase Contract is registered, no such registration shall be made unless the
Person requesting such registration has paid any transfer and other taxes
required by reason of such registration in a name other than that of the
registered Holder of such Certificate or has established to the satisfaction of
the Company that such tax either has been paid or is not payable.

       SECTION 5.4 ADJUSTMENT OF SETTLEMENT RATE.

              (a) Adjustments for Dividends, Distributions, Stock Splits, Etc.

                     (1) Stock Dividends. In case the Company shall pay or make
              a dividend or other distribution on the Common Stock in Common
              Stock, the Settlement Rate, as in effect at the opening of
              business on the day following the date fixed for the determination
              of stockholders entitled to receive such dividend or other
              distribution shall be increased by dividing such Settlement Rate
              by a fraction of which the numerator shall be the

                                       42
<PAGE>

              number of shares of Common Stock outstanding at the close of
              business on the date fixed for such determination and the
              denominator shall be the sum of such number of shares and the
              total number of shares constituting such dividend or other
              distribution, such increase to become effective immediately after
              the opening of business on the day following the date fixed for
              such determination. For the purposes of this paragraph (1), the
              number of shares of Common Stock at the time outstanding shall not
              include shares held in the treasury of the Company but shall
              include any shares issuable in respect of any scrip certificates
              issued in lieu of fractions of shares of Common Stock. The Company
              will not pay any dividend or make any distribution on shares of
              Common Stock held in the treasury of the Company.

                     (2) Stock Purchase Rights. In case the Company shall issue
              rights, options or warrants to all holders of its Common Stock
              (not being available on an equivalent basis to Holders of the
              Units upon settlement of the Purchase Contracts underlying such
              Units) entitling them, for a period expiring within 45 days after
              the record date for the determination of stockholders entitled to
              receive such rights, options or warrants, to subscribe for or
              purchase shares of Common Stock at a price per share less than the
              Current Market Price per share of the Common Stock on the date
              fixed for the determination of stockholders entitled to receive
              such rights, options or warrants (other than pursuant to a
              dividend reinvestment or share purchase or similar plan), the
              Settlement Rate in effect at the opening of business on the day
              following the date fixed for such determination shall be increased
              by dividing such Settlement Rate by a fraction, the numerator of
              which shall be the number of shares of Common Stock outstanding at
              the close of business on the date fixed for such determination
              plus the number of shares of Common Stock which the aggregate of
              the offering price of the total number of shares of Common Stock
              so offered for subscription or purchase would purchase at such
              Current Market Price and the denominator of which shall be the
              number of shares of Common Stock outstanding at the close of
              business on the date fixed for such determination plus the number
              of shares of Common Stock so offered for subscription or purchase,
              such increase to become effective immediately after the opening of
              business on the day following the date fixed for such
              determination. For the purposes of this paragraph (2), the number
              of shares of Common Stock at any time outstanding shall not
              include shares held in the treasury of the Company but shall
              include any shares issuable in respect of any scrip certificates
              issued in lieu of fractions of shares of Common Stock. The Company
              shall not issue any such rights, options or warrants in respect of
              shares of Common Stock held in the treasury of the Company.

                                       43
<PAGE>

                     (3) Stock Splits; Reverse Splits. In case outstanding
              shares of Common Stock shall be subdivided or split into a greater
              number of shares of Common Stock, the Settlement Rate in effect at
              the opening of business on the day following the day upon which
              such subdivision or split becomes effective shall be
              proportionately increased, and, conversely, in case outstanding
              shares of Common Stock shall each be combined into a smaller
              number of shares of Common Stock, the Settlement Rate in effect at
              the opening of business on the day following the day upon which
              such combination becomes effective shall be proportionately
              reduced, such increase or reduction, as the case may be, to become
              effective immediately after the opening of business on the day
              following the day upon which such subdivision, split or
              combination becomes effective.

                     (4) Debt or Asset Distributions. (i) In case the Company
              shall, by dividend or otherwise, distribute to all holders of its
              Common Stock evidences of its indebtedness or assets (including
              securities, but excluding (a) any rights, options or warrants
              referred to in paragraph (2) of this Section, (b) any dividend or
              distribution paid exclusively in cash, (c) any distribution on the
              Common Stock of shares of Capital Stock of any class or series, or
              similar equity interests, of or relating to a subsidiary or other
              business unit in the case of a Spin-Off referred to in clause (ii)
              of this paragraph, and (d) any dividend or distribution referred
              to in paragraph (1) of this Section), the Settlement Rate shall be
              adjusted so that the same shall equal the rate, if positive,
              determined by dividing the Settlement Rate in effect immediately
              prior to the close of business on the date fixed for the
              determination of stockholders entitled to receive such
              distribution by a fraction, the numerator of which shall be the
              Current Market Price per share of the Common Stock on the date
              fixed for such determination less the then fair market value (as
              determined by the Board of Directors, whose determination shall be
              conclusive and described in a Board Resolution filed with the
              Agent) of the portion of the assets or evidences of indebtedness
              so distributed applicable to one share of Common Stock and the
              denominator of which shall be such Current Market Price per share
              of the Common Stock, such adjustment to become effective
              immediately prior to the opening of business on the day following
              the date fixed for the determination of stockholders entitled to
              receive such distribution. In any case in which this paragraph (4)
              is applicable, paragraphs (1) and (2) of this Section shall not be
              applicable.

                     (ii) In the case of a Spin-Off, the Settlement Rate in
              effect immediately before the close of business on the record date
              fixed for determination of stockholders entitled to receive that
              distribution will be increased by multiplying the Settlement Rate
              by a fraction, the numerator of which is the Current Market Price
              per share of the Common Stock plus the Fair Market Value of the
              portion of those shares of Capital Stock or

                                       44
<PAGE>

              similar equity interests so distributed applicable to one share of
              Common Stock and the denominator of which is the Current Market
              Price per share of the Common Stock. Any adjustment to the
              Settlement Rate under this paragraph 4(ii) will be determined at
              the earlier of (1) the tenth Trading Day from, and including, the
              effective date of the Spin-Off (or, if the Settlement Rate is
              required to be adjusted without regard to Trading Days, the
              effective date of such Spin-Off ) and (2) the date of the Initial
              Public Offering of the securities subject of the Spin-Off, if that
              Initial Public Offering is effected simultaneously with the
              Spin-Off, and shall be given retroactive effect to the opening of
              business on the day following the date fixed for determination of
              stockholders entitled to receive the Spin-Off Distribution.

                     (5) Cash Distributions. In case the Company shall, (i) by
              dividend or otherwise, distribute to all holders of its Common
              Stock cash (excluding any cash that is distributed in a
              Reorganization Event to which Section 5.4(b) applies or as part of
              a distribution referred to in paragraph (4) of this Section) in an
              aggregate amount that, combined together with (ii) the aggregate
              amount of any other distributions to all holders of its Common
              Stock made exclusively in cash within the 12 months preceding the
              date of payment of such distribution and in respect of which no
              adjustment pursuant to this paragraph (5) or paragraph (6) of this
              Section has been made and (iii) the aggregate of any cash plus the
              fair market value (as determined by the Board of Directors, whose
              determination shall be conclusive and described in a Board
              Resolution filed with the Agent) of consideration payable in
              respect of any tender or exchange offer by the Company or any of
              its subsidiaries for all or any portion of the Common Stock
              concluded within the 12 months preceding the date of payment of
              the distribution described in clause (i) above and in respect of
              which no adjustment pursuant to this paragraph (5) or paragraph
              (6) of this Section has been made, exceeds 15% of the product of
              the Current Market Price per share of the Common Stock on the date
              for the determination of holders of shares of Common Stock
              entitled to receive such distribution times the number of shares
              of Common Stock outstanding on such date, then, and in each such
              case, immediately after the close of business on such date for
              determination, the Settlement Rate shall be increased so that the
              same shall equal the rate determined by dividing the Settlement
              Rate in effect immediately prior to the close of business on the
              date fixed for determination of the stockholders entitled to
              receive such distribution by a fraction (A) the numerator of which
              shall be equal to the Current Market Price per share of the Common
              Stock on the date fixed for such determination less an amount
              equal to the quotient of (x) the combined amount distributed or
              payable in the transactions described in clauses (i), (ii) and
              (iii) above and (y) the number of shares of Common Stock
              outstanding on such date for determination and (B) the denominator
              of

                                       45
<PAGE>

              which shall be equal to the Current Market Price per share of the
              Common Stock on such date for determination.

                     (6) Tender Offers. In case (i) a tender or exchange offer
              made by the Company or any subsidiary of the Company for all or
              any portion of the Common Stock shall expire and such tender or
              exchange offer (as amended upon the expiration thereof) shall
              require the payment to stockholders (based on the acceptance (up
              to any maximum specified in the terms of the tender or exchange
              offer) of Purchased Shares) of an aggregate consideration having a
              fair market value (as determined by the Board of Directors, whose
              determination shall be conclusive and described in a Board
              Resolution filed with the Agent) that combined together with (ii)
              the aggregate of the cash plus the fair market value (as
              determined by the Board of Directors, whose determination shall be
              conclusive and described in a Board Resolution filed with the
              Agent), as of the expiration of such tender or exchange offer, of
              consideration payable in respect of any other tender or exchange
              offer, by the Company or any subsidiary of the Company for all or
              any portion of the Common Stock expiring within the 12 months
              preceding the expiration of such tender or exchange offer and in
              respect of which no adjustment pursuant to paragraph (5) of this
              Section or this paragraph (6) has been made and (iii) the
              aggregate amount of any distributions to all holders of the
              Company's Common Stock made exclusively in cash within the 12
              months preceding the expiration of such tender or exchange offer
              and in respect of which no adjustment pursuant to paragraph (5) of
              this Section or this paragraph (6) has been made, exceeds 15% of
              the product of the Current Market Price per share of the Common
              Stock as of the last time (the "Expiration Time") tenders could
              have been made pursuant to such tender or exchange offer (as it
              may be amended) times the number of shares of Common Stock
              outstanding (including any tendered shares) on the Expiration
              Time, then, and in each such case, immediately prior to the
              opening of business on the day after the date of the Expiration
              Time, the Settlement Rate shall be adjusted so that the same shall
              equal the rate, if positive, determined by dividing the Settlement
              Rate immediately prior to the close of business on the date of the
              Expiration Time by a fraction (A) the numerator of which shall be
              equal to (x) the product of (I) the Current Market Price per share
              of the Common Stock on the date of the Expiration Time and (II)
              the number of shares of Common Stock outstanding (including any
              tendered shares) on the Expiration Time less (y) the amount of
              cash plus the fair market value (determined as aforesaid) of the
              aggregate consideration payable to stockholders based on the
              transactions described in clauses (i), (ii) and (iii) above
              (assuming in the case of clause (i) the acceptance, up to any
              maximum specified in the terms of the tender or exchange offer, of
              Purchased Shares), and (B) the denominator of which shall be equal
              to the product of (x) the Current Market Price per share of the
              Common Stock as of the Expiration Time

                                       46
<PAGE>

              and (y) (i) the number of shares of Common Stock outstanding
              (including any tendered shares) as of the Expiration Time less
              (ii) the number of all shares validly tendered and not withdrawn
              as of the Expiration Time (the shares deemed so accepted, up to
              any such maximum, being referred to as the "Purchased Shares").

                     (7) Reclassification. The reclassification of Common Stock
              into securities including securities other than Common Stock
              (other than any reclassification upon a Reorganization Event to
              which Section 5.4(b) applies) shall be deemed to involve (i) a
              distribution of such securities other than Common Stock to all
              holders of Common Stock (and the effective date of such
              reclassification shall be deemed to be "the date fixed for the
              determination of stockholders entitled to receive such
              distribution" and the "date fixed for such determination" within
              the meaning of paragraph (4) of this Section), and (ii) a
              subdivision, split or combination, as the case may be, of the
              number of shares of Common Stock outstanding immediately prior to
              such reclassification into the number of shares of Common Stock
              outstanding immediately thereafter (and the effective date of such
              reclassification shall be deemed to be "the day upon which such
              subdivision or split becomes effective" or "the day upon which
              such combination becomes effective," as the case may be, and "the
              day upon which such subdivision, split or combination becomes
              effective" within the meaning of paragraph (3) of this Section).

                     (8) "Current Market Price". The "Current Market Price" per
              share of Common Stock on any day means (a) the average of the Sale
              Price for the 5 consecutive Trading Days preceding the earlier of
              the day preceding the day in question and the day before the "ex
              date" with respect to the issuance or distribution requiring
              computation, (b) in the case of any Spin-Off that is effected
              simultaneously with an Initial Public Offering of the securities
              being distributed in the Spin-Off, the Sale Price of the Common
              Stock on the Trading Day on which the initial public offering
              price of the securities being distributed in the Spin-Off is
              determined, and (c) in the case of any other Spin-Off, the average
              of the Sale Price of the Common Stock over the first 10 Trading
              Days after the effective date of such Spin-Off; provided, in each
              case, that if the Sale Price is required to be determined without
              regard to Trading Days, the effective date of such Spin-Off . For
              purposes of this paragraph, the term "ex date," when used with
              respect to any issuance or distribution, shall mean the first date
              on which the Common Stock trades regular way on such exchange or
              in such market without the right to receive such issuance or
              distribution.

                     (9) Calculation of Adjustments. All adjustments to the
              Settlement Rate shall be calculated to the nearest 1/10,000th of a
              share of

                                       47
<PAGE>

              Common Stock (or if there is not a nearest 1/10,000th of a share
              to the next lower 1/10,000th of a share). No adjustment in the
              Settlement Rate shall be required unless such adjustment would
              require an increase or decrease of at least one percent therein;
              provided, that any adjustments which by reason of this
              subparagraph are not required to be made shall be carried forward
              and taken into account in any subsequent adjustment. If an
              adjustment is made to the Settlement Rate pursuant to paragraph
              (1), (2), (3), (4), (5), (6), (7) or (10) of this Section 5.4(a),
              an adjustment shall also be made to the Applicable Market Value
              solely to determine which of clauses (i), (ii) or (iii) of the
              definition of Settlement Rate in Section 5.1(a) will apply on the
              Stock Purchase Date. Such adjustment shall be made by multiplying
              the Applicable Market Value by a fraction, the numerator of which
              shall be the Settlement Rate immediately after such adjustment
              pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of
              this Section 5.4(a) and the denominator of which shall be the
              Settlement Rate immediately before such adjustment; provided, that
              if such adjustment to the Settlement Rate is required to be made
              pursuant to the occurrence of any of the events contemplated by
              paragraph (1), (2), (3), (4), (5), (7) or (10) of this Section
              5.4(a) during the period taken into consideration for determining
              the Applicable Market Value, appropriate and customary adjustments
              shall be made to the Settlement Rate.

                     (10) Increase of Settlement Rate. The Company may make such
              increases in the Settlement Rate, in addition to those required by
              this Section, as it considers to be advisable in order to avoid or
              diminish any income tax to any holders of shares of Common Stock
              resulting from any dividend or distribution of stock or issuance
              of rights or warrants to purchase or subscribe for stock or from
              any event treated as such for income tax purposes or for any other
              reasons.

              (b) Adjustment for Consolidation, Merger or Other Reorganization
       Event.

              In the event of

                     (1) any consolidation or merger of the Company with or into
              another Person (other than a merger or consolidation in which the
              Company is the continuing entity and in which the Common Stock
              outstanding immediately prior to the merger or consolidation is
              not exchanged for cash, securities or other property of the
              Company or another corporation),

                     (2) any sale, transfer, lease or conveyance to another
              Person of the property of the Company as an entirety or
              substantially as an entirety,

                                       48
<PAGE>

                     (3) any statutory exchange of securities of the Company
              with another Person (other than in connection with a merger or
              acquisition), or

                     (4) any liquidation, dissolution or winding up of the
              Company other than as a result of or after the occurrence of a
              Termination Event (any such event, a "Reorganization Event"),

the Settlement Rate will be adjusted to provide that each Holder of Units will
receive on the Stock Purchase Date with respect to each Purchase Contract
forming a part thereof, the kind and amount of securities, cash and other
property receivable upon such Reorganization Event (without any interest
thereon, and without any right to dividends or distribution thereon which have a
record date that is prior to the Stock Purchase Date) by a Holder of the number
of shares of Common Stock issuable on account of each Purchase Contract if the
Stock Purchase Date had occurred immediately prior to such Reorganization Event
assuming such Holder of Common Stock is not a Person with which the Company
consolidated or into which the Company merged or which merged into the Company
or to which such sale or transfer was made, as the case may be (any such Person,
a "Constituent Person"), or an Affiliate of a Constituent Person to the extent
such Reorganization Event provides for different treatment of Common Stock held
by Affiliates of the Company and non-Affiliates, and such Holder failed to
exercise his rights of election, if any, as to the kind or amount of securities,
cash and other property receivable upon such Reorganization Event (provided that
if the kind or amount of securities, cash and other property receivable upon
such Reorganization Event is not the same for each share of Common Stock held
immediately prior to such Reorganization Event by other than a Constituent
Person or an Affiliate thereof and in respect of which such rights of election
shall not have been exercised ("Non-electing Share"), then for the purpose of
this Section the kind and amount of securities, cash and other property
receivable upon such Reorganization Event by each Non-electing Share shall be
deemed to be the kind and amount so receivable per share by a plurality of the
Non-electing Shares).

              In the event of such a Reorganization Event, the Person formed by
such consolidation, merger or exchange or the Person which acquires the assets
of the Company or, in the event of a liquidation or dissolution of the Company,
the Company or a liquidating trust created in connection therewith, shall
execute and deliver to the Agent an agreement supplemental hereto providing that
the Holder of each Outstanding Unit shall have the rights provided by this
Section 5.4. Such supplemental agreement shall provide for adjustments which,
for events subsequent to the effective date of such supplemental agreement,
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Section. The above provisions of this Section shall similarly apply
to successive Reorganization Events.

                                       49
<PAGE>

       SECTION 5.5 NOTICE OF ADJUSTMENTS AND CERTAIN OTHER EVENTS.

              (a) Whenever the Settlement Rate is adjusted as herein provided,
       the Company shall:

                     (i) forthwith compute the Settlement Rate in accordance
              with Section 5.4 and prepare and transmit to the Agent an
              Officers' Certificate setting forth the Settlement Rate, the
              method of calculation thereof in reasonable detail, and the facts
              requiring such adjustment and upon which such adjustment is based;
              and

                     (ii) within 10 Business Days following the occurrence of an
              event that requires an adjustment to the Settlement Rate pursuant
              to Section 5.4 (or if the Company is not aware of such occurrence,
              as soon as practicable after becoming so aware), provide a written
              notice to the Holders of the Units of the occurrence of such event
              and a statement in reasonable detail setting forth the method by
              which the adjustment to the Settlement Rate was determined and
              setting forth the adjusted Settlement Rate.

              (b) The Agent shall not at any time be under any duty or
       responsibility to any Holder of Units to determine whether any facts
       exist which may require any adjustment of the Settlement Rate, or with
       respect to the nature or extent or calculation of any such adjustment
       when made, or with respect to the method employed in making the same. The
       Agent shall not be accountable with respect to the validity or value (or
       the kind or amount) of any shares of Common Stock, or of any securities
       or property, which may at the time be issued or delivered with respect to
       any Purchase Contract; and the Agent makes no representation with respect
       thereto. The Agent shall not be responsible for any failure of the
       Company to issue, transfer or deliver any shares of Common Stock pursuant
       to a Purchase Contract or to comply with any of the duties,
       responsibilities or covenants of the Company contained in this Article.

       SECTION 5.6 TERMINATION EVENT; NOTICE.

              The Purchase Contracts and all obligations and rights of the
Company and the Holders thereunder, including the rights and obligations of
Holders to purchase Common Stock, shall immediately and automatically terminate,
without the necessity of any notice or action by any Holder, the Agent or the
Company, if, on or prior to the Stock Purchase Date, a Termination Event shall
have occurred. Upon and after the occurrence of a Termination Event, the Normal
Units shall thereafter represent the right to receive the Debentures or the
appropriate Treasury Consideration, as the case may be, forming a part of such
Normal Units, and the Stripped Units shall thereafter represent the right to
receive the Treasury Securities forming a part of such Stripped Units, in each
case in

                                       50
<PAGE>
accordance with the provisions of Section 4.3 of the Pledge Agreement.
Upon the occurrence of a Termination Event, the Company shall promptly but in no
event later than two Business Days thereafter give written notice to the Agent,
the Collateral Agent and to the Holders, at their addresses as they appear in
the Register.

        SECTION 5.7 EARLY SETTLEMENT.

               (a) Subject to and upon compliance with the provisions of this
        Section 5.7, Purchase Contracts underlying Units having an aggregate
        Stated Amount equal to $1,000 or an integral multiple thereof may, at
        the option of the Holder thereof, be settled early ("Early Settlement")
        on or prior to the seventh Business Day immediately preceding the
        Remarketing Date or any Subsequent Remarketing Date; provided however,
        that if a Tax Event Redemption has occurred and the Treasury
        Consideration has become a component of the Normal Units, Purchase
        Contracts underlying Normal Units may be settled early, on or prior to
        the fourth Business Day immediately preceding the Stock Purchase Date,
        in integral multiples of Normal Units such that Treasury Consideration
        to be released is in integral multiples of $1,000. In order to exercise
        the right to effect Early Settlement with respect to any Purchase
        Contracts, the Holder of the Certificate evidencing the related Units
        shall deliver such Certificate to the Agent at the Corporate Trust
        Office duly endorsed for transfer to the Company or in blank with the
        form of Election to Settle Early on the reverse thereof duly completed
        and accompanied by payment payable to the Company in immediately
        available funds in an amount (the "Early Settlement Amount") equal to
        the product of (i) the Stated Amount of such Units multiplied by (ii)
        the number of Purchase Contracts with respect to which the Holder has
        elected to effect Early Settlement. If the foregoing requirements are
        first satisfied with respect to Purchase Contracts underlying any Unit
        at or prior to 5:00 p.m., New York City time, on a Business Day, such
        day shall be the "Early Settlement Date" with respect to such Unit and
        if such requirements are first satisfied after 5:00 p.m., New York City
        time, on a Business Day or on a day that is not a Business Day, the
        "Early Settlement Date" with respect to such Units shall be the next
        succeeding Business Day.

               (b) Upon Early Settlement of any Purchase Contract by the Holder
        of the related Units, the Company shall issue, and the Holder shall be
        entitled to receive, 2.1597 shares of Common Stock on account of such
        Purchase Contract (the "Early Settlement Rate"). The Early Settlement
        Rate shall be adjusted in the same manner and at the same time as the
        Settlement Rate is adjusted pursuant to Section 5.4. As promptly as
        practicable after Early Settlement of Purchase Contracts in accordance
        with the provisions of this Section 5.7, the Company shall issue and
        shall deliver to the Agent at the Corporate Trust Office a certificate
        or certificates for the full number of shares of Common Stock issuable
        upon such Early Settlement together with payment in lieu of any fraction
        of a share, as provided in Section 5.10.

                                       51
<PAGE>

               (c) No later than the third Business Day after the applicable
        Early Settlement Date the Company shall cause (i) the shares of Common
        Stock issuable upon Early Settlement of Purchase Contracts to be issued
        and delivered, and (ii) the related Pledged Debentures or Pledged
        Treasury Consideration, in the case of Normal Units, or the related
        Pledged Treasury Securities, in the case of Stripped Units, to be
        released from the Pledge by the Collateral Agent and transferred, in
        each case, to the Agent for delivery to the Holder thereof or the
        Holder's designee.

               (d) Upon Early Settlement of any Purchase Contracts, and subject
        to receipt of shares of Common Stock from the Company and the Pledged
        Debentures, Pledged Treasury Consideration or Pledged Treasury
        Securities, as the case may be, from the Collateral Agent, as
        applicable, the Agent shall, in accordance with the instructions
        provided by the Holder thereof on the applicable form of Election to
        Settle Early on the reverse of the Certificate evidencing the related
        Units, (i) transfer to the Holder the Pledged Debentures, Pledged
        Treasury Consideration or Pledged Treasury Securities, as the case may
        be, forming a part of such Units, and (ii) deliver to the Holder a
        certificate or certificates for the full number of shares of Common
        Stock issuable upon such Early Settlement together with payment in lieu
        of any fraction of a share, as provided in Section 5.10.

               (e) In the event that Early Settlement is effected with respect
        to Purchase Contracts underlying less than all the Units evidenced by a
        Certificate, upon such Early Settlement the Company shall execute and
        the Agent shall authenticate, countersign and deliver to the Holder
        thereof, at the expense of the Company, a Certificate evidencing the
        Units as to which Early Settlement was not effected.

        SECTION 5.8 EARLY SETTLEMENT UPON MERGER.

               (a) In the event of a merger or consolidation of the Company of
        the type described in clause (1) of Section 5.4(b) in which the Common
        Stock outstanding immediately prior to such merger or consolidation is
        exchanged for consideration consisting of at least 30% cash or cash
        equivalents (any such event a "Cash Merger"), then the Company (or the
        successor to the Company hereunder) shall be required to offer the
        Holder of each Unit the right to settle the Purchase Contract underlying
        such Unit prior to the Stock Purchase Date ("Merger Early Settlement")
        as provided herein. On or before the fifth Business Day after the
        consummation of a Cash Merger, the Company or, at the request and
        expense of the Company, the Agent, shall give all Holders notice of the
        occurrence of the Cash Merger and of the right of Merger Early
        Settlement arising as a result thereof. The Company shall also deliver a
        copy of such notice to the Agent and the Collateral Agent.

               Each such notice shall contain:

                                       52
<PAGE>

                    (i) the date, which shall be not less than 20 nor more than
               30 calendar days after the date of such notice, on which the
               Merger Early Settlement will be effected (the "Merger Early
               Settlement Date");

                    (ii) the date, which shall be three Business Days prior to
               the Merger Early Settlement Date, by which the Merger Early
               Settlement right must be exercised;

                    (iii) the Settlement Rate in effect as a result of such Cash
               Merger and the kind and amount of securities, cash and other
               property receivable by the Holder upon settlement of each
               Purchase Contract pursuant to Section 5.4(b);

                    (iv) a statement to the effect that all or a portion of the
               Purchase Price payable by the Holder to settle the Purchase
               Contract will be offset against the amount of cash so receivable
               upon exercise of Merger Early Settlement, as applicable; and

                    (v) the instructions a Holder must follow to exercise the
               Merger Early Settlement right.

               (b) To exercise a Merger Early Settlement right, a Holder shall
        deliver to the Agent at the Corporate Trust Office on or before 5:00
        p.m., New York City time on the date specified in the notice, (i)
        payment payable to the Company in immediately available funds in an
        amount equal to the Early Settlement Amount less the amount of cash that
        otherwise would be deliverable by the Company or its successor upon
        settlement of the Purchase Contract in lieu of Common Stock pursuant to
        Section 5.4(b) and as described in the notice to Holders (the "Merger
        Early Settlement Amount"), and (ii) (A) a duly completed Election to
        Settle Early, provided to such Holder by the Agent, in the form on the
        reverse of the Global Certificate evidencing the Units with respect to
        which the Merger Early Settlement right is being exercised or (B) if the
        Certificates are held in definitive, fully registered form, the
        Certificate(s) evidencing the Units with respect to which the Merger
        Early Settlement right is being exercised duly endorsed for transfer to
        the Company or in blank with the form of Election to Settle Early on the
        reverse thereof duly completed.

               (c) On the Merger Early Settlement Date, the Company shall
        deliver or cause to be delivered (i) the net cash, securities and other
        property to be received by such exercising Holder, equal to the
        Settlement Rate as adjusted to provide that each Holder of Units will
        receive on the Merger Early Settlement Date with respect to each
        Purchase Contract forming a part thereof, the kind and amount of
        securities, cash and other property receivable upon such Cash Merger
        (without any interest thereon, and without any right to dividends or
        distribution thereon which have a record date that is prior to the
        Merger Early Settlement

                                       53
<PAGE>

        Date) equal to the number of shares of Common Stock issuable on account
        of each Purchase Contract if the Merger Early Settlement Date had
        occurred immediately prior to such Cash Merger and as further adjusted
        pursuant to Section 5.4, in respect of the number of Purchase Contracts
        for which such Merger Early Settlement right was exercised, and (ii) the
        related Pledged Debentures or Pledged Treasury Consideration, in the
        case of Normal Units, or Pledged Treasury Securities, in the case of
        Stripped Units, to be released from the Pledge by the Collateral Agent
        and transferred, in each case, to the Agent for delivery to the Holder
        thereof or its designee. In the event a Merger Early Settlement right
        shall be exercised by a Holder in accordance with the terms hereof,
        except as otherwise provided, all references herein to Stock Purchase
        Date shall be deemed to refer to such Merger Early Settlement Date.

               (d) Upon Merger Early Settlement of any Purchase Contracts, and
        subject to receipt of such net cash, securities or other property from
        the Company and the Pledged Debentures, Pledged Treasury Consideration
        or Pledged Treasury Securities, as the case may be, from the Collateral
        Agent, as applicable, the Agent shall, in accordance with the
        instructions provided by the Holder thereof on the applicable form of
        Election to Settle Early on the reverse of the Certificate evidencing
        the related Units, (i) transfer to the Holder the Pledged Debentures,
        Pledged Treasury Consideration or Pledged Treasury Securities, as the
        case may be, forming a part of such Units, and (ii) in lieu of any
        shares of Common Stock issuable to the Hodler hereunder, deliver to the
        Holder such net cash, securities or other property issuable upon such
        Merger Early Settlement together with payment in lieu of any fraction of
        a share, as provided in Section 5.10.

               (e) In the event that Merger Early Settlement is effected with
        respect to Purchase Contracts underlying less than all the Units
        evidenced by a Certificate, upon such Merger Early Settlement the
        Company (or the successor to the Company hereunder) shall execute and
        the Agent shall authenticate, countersign and deliver to the Holder
        thereof, at the expense of the Company, a Certificate evidencing the
        Units as to which Merger Early Settlement was not effected.

               (f) In the event a Holder does not exercise such Holder's Merger
        Early Settlement right, each such non-exercising Holder of Units will
        receive on the Stock Purchase Date with respect to each Purchase
        Contract forming a part thereof, the kind and amount of securities, cash
        and other property receivable upon such Cash Merger (without any
        interest thereon, and without any right to dividends or distribution
        thereon which have a record date that is prior to the Stock Purchase
        Date) equal to the number of shares of Common Stock issuable on account
        of each Purchase Contract if the Stock Purchase Date had occurred
        immediately prior to such Cash Merger. The above provisions of this
        Section shall similarly apply to successive Reorganization Events to the
        extent a Holder has not previously exercised his Merger Early Settlement
        right.

                                       54
<PAGE>

        SECTION 5.9 CHARGES AND TAXES.

               The Company will pay all stock transfer and similar taxes
attributable to the initial issuance and delivery of the shares of Common Stock
pursuant to the Purchase Contracts; provided, that the Company shall not be
required to pay any such tax or taxes which may be payable in respect of any
exchange of or substitution for a Certificate evidencing a Unit or any issuance
of a share of Common Stock in a name other than that of the registered Holder of
a Certificate surrendered in respect of the Units evidenced thereby, other than
in the name of the Agent, as custodian for such Holder, and the Company shall
not be required to issue or deliver such share certificates or certificates
unless and until the Person or Persons requesting the transfer or issuance
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 5.10 NO FRACTIONAL SHARES.

               No fractional shares or scrip representing fractional shares of
Common Stock shall be issued or delivered upon settlement on the Stock Purchase
Date or upon Early Settlement or Merger Early Settlement of any Purchase
Contracts. If Certificates evidencing more than one Purchase Contract shall be
surrendered for settlement at one time by the same Holder, the number of full
shares of Common Stock which shall be delivered upon settlement shall be
computed on the basis of the aggregate number of Purchase Contracts evidenced by
the Certificates so surrendered. Instead of any fractional share of Common Stock
which would otherwise be deliverable upon settlement of any Purchase Contracts
on the applicable Settlement Date or upon Early Settlement or Merger Early
Settlement, the Company, through the Agent, shall make a cash payment in respect
of such fractional shares in an amount equal to the value of such fractional
shares times the Applicable Market Value. The Company shall provide the Agent
from time to time with sufficient funds to permit the Agent to make all cash
payments required by this Section 5.10 in a timely manner.

                                   ARTICLE VI

                                    REMEDIES

        SECTION 6.1 UNCONDITIONAL RIGHT OF HOLDERS TO PURCHASE COMMON STOCK.

               The Holder of any Unit shall have the right, which is absolute
and unconditional, to purchase Common Stock pursuant to the Purchase Contract
constituting a part of such Unit and to institute suit for the enforcement of
any such right to purchase Common Stock, and such rights shall not be impaired
without the consent of such Holder.

                                       55
<PAGE>

        SECTION 6.2 RESTORATION OF RIGHTS AND REMEDIES.

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

        SECTION 6.3 RIGHTS AND REMEDIES CUMULATIVE.

               Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Certificates in the last
paragraph of Section 3.10, no right or remedy herein conferred upon or reserved
to the Holders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.

        SECTION 6.4 DELAY OR OMISSION NOT WAIVER.

               No delay or omission of any Holder to exercise any right or
remedy upon a default shall impair any such right or remedy or constitute a
waiver of any such right. Every right and remedy given by this Article or by law
to the Holders may be exercised from time to time, and as often as may be deemed
expedient, by such Holders.

        SECTION 6.5 UNDERTAKING FOR COSTS.

               All parties to this Agreement agree, and each Holder of a Unit,
by its acceptance of such Unit 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 Agreement, or in any suit against the Agent for any action
taken, suffered or omitted by it as Agent, 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; provided
that the provisions of this Section shall not apply to any suit instituted by
the Company, to any suit instituted by the Agent, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% of the
Outstanding Units, or to any suit instituted by any Holder for the enforcement
of interest on any Debentures on any Purchase Contract on or after the
respective Payment Date therefor in respect of any Unit held by such Holder, or
for enforcement of the right to purchase shares of Common Stock under the
Purchase Contract constituting part of any Unit held by such Holder.

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        SECTION 6.6 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 Agreement; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, but will suffer and permit the execution of every such power as though no
such law had been enacted.

                                  ARTICLE VII

                                    THE AGENT

        SECTION 7.1 CERTAIN DUTIES AND RESPONSIBILITIES.

               (a)  (1) The Agent undertakes to perform, with respect to the
        Units and Separate Debentures, such duties and only such duties as are
        specifically set forth in this Agreement and the Pledge Agreement, and
        no implied covenants or obligations shall be read into this Agreement
        against the Agent; and

                    (2) in the absence of bad faith on its part, the Agent may,
               with respect to the Units and Separate Debentures, conclusively
               rely, as to the truth of the statements and the correctness of
               the opinions expressed therein, upon certificates or opinions
               furnished to the Agent and conforming to the requirements of this
               Agreement, but in the case of any certificates or opinions which
               by any provision hereof are specifically required to be furnished
               to the Agent, the Agent shall be under a duty to examine the same
               to determine whether or not they conform to the requirements of
               this Agreement (but need not confirm or investigate the accuracy
               of the mathematical calculations or other facts stated therein).

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

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

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

                    (3) no provision of this Agreement shall require the Agent
               to expend or risk its own funds or otherwise incur any financial
               liability in

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               the performance of any of its duties hereunder, or in the
               exercise of any of its rights or powers.

               (c) Whether or not therein expressly so provided, every provision
        of this Agreement relating to the conduct or affecting the liability of
        or affording protection to the Agent shall be subject to the provisions
        of this Section.

               (d) The Agent is authorized to execute and deliver the Pledge
        Agreement in its capacity as Agent. The Agent shall be entitled to all
        of the rights, privileges, immunities and indemnities contained in this
        Agreement with respect to any duties of the Agent under, or actions
        taken, omitted to be taken or suffered by the Agent pursuant to the
        Pledge Agreement.

        SECTION 7.2 NOTICE OF DEFAULT.

               Within 30 days after the occurrence of any default by the Company
hereunder of which a Responsible Officer of the Agent has actual knowledge, the
Agent shall transmit by mail to the Company and the Holders of Units, as their
names and addresses appear in the Register, notice of such default hereunder,
unless such default shall have been cured or waived.

        SECTION 7.3 CERTAIN RIGHTS OF AGENT.

               Subject to the provisions of Section 7.1:

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

               (b) any request or direction of the Company mentioned herein
        shall be sufficiently evidenced by an Officers' Certificate, Issuer
        Order or Issuer Request, and any resolution of the Board of Directors of
        the Company may be sufficiently evidenced by a Board Resolution;

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

               (d) the Agent may consult with counsel and the advice of such
        counsel or any Opinion of Counsel shall be full and complete
        authorization and protection

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        in respect of any action taken, suffered or omitted by it hereunder in
        good faith and in reliance thereon;

               (e) the Agent shall not be bound to make any investigation into
        the facts or matters stated in any resolution, certificate, statement,
        instrument, opinion, report, notice, request, direction, consent, order,
        bond, debenture, note, other evidence of indebtedness or other paper or
        document, but the Agent, in its discretion, may make reasonable further
        inquiry or investigation into such facts or matters related to the
        execution, delivery and performance of the Purchase Contracts as it may
        see fit, and, if the Agent shall determine to make such further inquiry
        or investigation, it shall be given a reasonable opportunity to examine
        the books, records and premises of the Company, personally or by agent
        or attorney;

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

               (g) the rights, privileges, protections, immunities and benefits
        given to the Agent, including, but not limited to, its right to be
        indemnified, are extended to, and shall be enforceable by, the Agent in
        each of its capacities hereunder, and to each agent, custodian and other
        Person employed to act hereunder;

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

               (i) the Agent shall not be charged with knowledge of any default
        by the Company hereunder unless a Responsible Officer shall have
        obtained written notice of such default;

               (j) in no event shall the Agent be liable for any consequential,
        punitive, indirect or special loss or damages of any kind whatsoever
        (including but not limited to lost profit), even if the Agent has been
        advised of the likelihood of such loss or damage and regardless of the
        form of action;

               (k) the Agent shall not be responsible or liable for any failure
        or delay in the performance of its obligations under this Agreement
        arising out of or caused, directly or indirectly, by circumstances
        beyond its reasonable control, including without limitation, acts of
        God; earthquakes; fires; floods; wars; civil or military disturbances;
        terrorist acts; sabotage; epidemics; riots; interruptions, loss or
        malfunctions of utilities, computer (hardware or software) or
        communications service; accidents; labor disputes; and acts of civil or
        military authority or governmental actions; it being understood that the
        Agent shall use reasonable

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<PAGE>

                efforts which are consistent with accepted practices in the
                banking industry to resume performance as soon as practicable
                under the circumstances; and

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

        SECTION 7.4 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF UNITS.

               The recitals contained herein and in the Certificates shall be
taken as the statements of the Company and the Agent assumes no responsibility
for their accuracy. The Agent makes no representations as to the validity or
sufficiency of either this Agreement or of the Units, or of the Pledge Agreement
or the Pledge. The Agent shall not be accountable for the use or application by
the Company of the Units or the proceeds therefrom or in respect of the Purchase
Contracts.

        SECTION 7.5 MAY HOLD UNITS.

               Any Registrar or any other agent of the Company, or the Agent and
its Affiliates, in their individual or any other capacity, may become the owner
or pledgee of Units and may otherwise deal with the Company, the Collateral
Agent or any other Person with the same rights it would have if it were not
Registrar or such other agent, or the Agent.

        SECTION 7.6 MONEY HELD IN CUSTODY.

               Money held by the Agent in custody hereunder need not be
segregated from the Agent's other funds except to the extent required by law or
provided herein. The Agent shall be under no obligation to invest or pay
interest on any money received by it hereunder except as otherwise agreed in
writing with the Company.

        SECTION 7.7 COMPENSATION AND REIMBURSEMENT.

               The Company agrees:

               (a) to pay to the Agent from time to time reasonable compensation
        for all services rendered by it hereunder;

               (b) except as otherwise expressly provided herein, to reimburse
        the Agent upon its request for all reasonable expenses, disbursements
        and advances incurred or made by the Agent in accordance with any
        provision of this Agreement (including the reasonable compensation and
        the reasonable expenses

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<PAGE>

        and disbursements of its agents and counsel), except any such expense,
        disbursement or advance as may be attributable to its gross negligence,
        bad faith or willful misconduct; and

               (c) to indemnify the Agent and any predecessor Agent for, and to
        hold it harmless against, any loss, liability or expense incurred
        without gross negligence, bad faith or willful misconduct on its part,
        arising out of or in connection with the acceptance or administration of
        its duties hereunder, including the costs and expenses of defending
        itself against any claim or liability in connection with the exercise or
        performance of any of its powers or duties hereunder.

               For purposes of this Section 7.7, "Agent" shall include any
predecessor Agent; provided, however, that the negligence, bad faith or willful
misconduct of any Agent hereunder shall not affect the rights of any other Agent
hereunder.

               The provisions of this Section 7.7 shall survive the termination
of this Agreement, the satisfaction or discharge of the Units and/or the
Separate Debentures and/or the resignation or removal of the Agent.

        SECTION 7.8 CORPORATE AGENT REQUIRED; ELIGIBILITY.

               There shall at all times be an Agent hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having (or being a member of a bank
holding company having) a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by federal or state authority and having
an office or agency in the Borough of Manhattan, The City of New York, if there
be such a corporation, qualified and eligible under this Article and willing to
act on reasonable terms. If such corporation publishes reports of condition at
least annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Agent 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 Agent and no appointment of
        a successor Agent pursuant to this Article shall become effective until
        the acceptance of appointment by the successor Agent in accordance with
        the applicable requirements of Section 7.10.

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<PAGE>

               (b) The Agent may resign at any time by giving written notice
        thereof to the Company 60 days prior to the effective date of such
        resignation. If the instrument of acceptance by a successor Agent
        required by Section 7.10 shall not have been delivered to the Agent
        within 30 days after the giving of such notice of resignation, the
        resigning Agent may petition any court of competent jurisdiction for the
        appointment of a successor Agent.

               (c) The Agent may be removed at any time by Act of the Holders of
        a majority in number of the Outstanding Units delivered to the Agent and
        the Company.

               (d) If at any time:

                    (1) the Agent fails to comply with Section 310(b) of the
               TIA, as if the Agent were an indenture trustee under an indenture
               qualified under the TIA, after written request therefor by the
               Company or by any Holder who has been a bona fide Holder of a
               Unit for at least six months; or

                    (2) the Agent shall cease to be eligible under Section 7.8
               and shall fail to resign after written request therefor by the
               Company or by any such Holder; or

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

        then, in any such case, (x) the Company by a Board Resolution may remove
        the Agent, or (y) any Holder who has been a bona fide Holder of a Unit
        for at least six months may, on behalf of himself and all others
        similarly situated, petition any court of competent jurisdiction for the
        removal of the Agent and the appointment of a successor Agent.

               (e) If the Agent shall resign, be removed or become incapable of
        acting, or if a vacancy shall occur in the office of Agent for any
        cause, the Company, by a Board Resolution, shall promptly appoint a
        successor Agent and shall comply with the applicable requirements of
        Section 7.10. If no successor Agent shall have been so appointed by the
        Company and accepted appointment in the manner required by Section 7.10,
        any Holder who has been a bona fide Holder of a Unit for at least six
        months may, on behalf of himself and all others similarly situated,
        petition any court of competent jurisdiction for the appointment of a
        successor Agent.

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<PAGE>

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

        SECTION 7.10 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.

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

               (b) Upon request of any such successor Agent, the Company shall
        execute any and all instruments for more fully and certainly vesting in
        and confirming to such successor Agent all such rights, powers and
        agencies referred to in paragraph (a) of this Section.

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

        SECTION 7.11 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
                     BUSINESS.

               Any corporation into which the Agent may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Agent shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Agent (including the administration of this Agreement), shall be the
successor of the Agent 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 Certificates shall have been authenticated and executed on behalf of the
Holders, but not delivered, by the Agent then in office, any successor to such
Agent shall adopt such authentication and execution and deliver the Certificates
so authenticated and executed with the same effect as if such successor Agent
had itself authenticated and executed such Units.

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<PAGE>

        SECTION 7.12 PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.

               (a) The Agent shall preserve, in as current a form as is
        reasonably practicable, the names and addresses of Holders received by
        the Agent in its capacity as Registrar.

               (b) If three or more Holders (herein referred to as "Applicants")
        apply in writing to the Agent, and furnish to the Agent reasonable proof
        that each such applicant has owned a Unit for a period of at least six
        months preceding the date of such application, and such application
        states that the applicants desire to communicate with other Holders with
        respect to their rights under this Agreement or under the Units and is
        accompanied by a copy of the form of proxy or other communication which
        such applicants propose to transmit, then the Agent shall mail to all
        the Holders copies of the form of proxy or other communication which is
        specified in such request, with reasonable promptness after a tender to
        the Agent of the materials to be mailed and of payment, or provision, in
        the absence of bad faith, satisfactory to the Agent for the payment, of
        the reasonable expenses of such mailing.

        SECTION 7.13 NO OBLIGATIONS OF AGENT.

               Except to the extent otherwise provided in this Agreement, the
Agent assumes no obligation and shall not be subject to any liability under this
Agreement, the Pledge Agreement or any Purchase Contract in respect of the
obligations of the Holder of any Unit thereunder. The Company agrees, and each
Holder of a Certificate, by such Holder's acceptance thereof, shall be deemed to
have agreed, that the Agent's execution of the Certificates on behalf of the
Holders shall be solely as agent and attorney-in-fact for the Holders, and that
the Agent shall have no obligation to perform such Purchase Contracts on behalf
of the Holders, except to the extent expressly provided in Article Five.

        SECTION 7.14 TAX COMPLIANCE.

               (a) The Agent, on its own behalf and on behalf of the Company,
        will comply with all applicable certification, information reporting and
        withholding (including "backup" withholding) requirements imposed by
        applicable tax laws, regulations or administrative practice with respect
        to (i) any payments made with respect to the Units or (ii) the issuance,
        delivery, holding, transfer, redemption or exercise of rights under the
        Units. Such compliance shall include, without limitation, the
        preparation and timely filing of required returns and the timely payment
        of all amounts required to be withheld to the appropriate taxing
        authority or its designated agent.

               (b) The Agent shall comply with any reasonable written direction
        timely received from the Company with respect to the execution or
        certification of

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<PAGE>

        any required documentation and the application of such requirements to
        particular payments or Holders or in other particular circumstances, and
        may for purposes of this Agreement conclusively rely on any such
        direction in accordance with the provisions of Section 7.1(a)(2).

               (c) The Agent shall maintain all appropriate records documenting
        compliance with such requirements, and shall make such records
        available, on written request, to the Company or its authorized
        representative within a reasonable period of time after receipt of such
        request.

                                  ARTICLE VIII

                             SUPPLEMENTAL AGREEMENTS

        SECTION 8.1 SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF HOLDERS.

        Without the consent of any Holders, the Company and the Agent, at any
        time and from time to time, may enter into one or more agreements
        supplemental hereto, in form satisfactory to the Company and the Agent,
        for any of the following purposes:

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

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

               (c) to evidence and provide for the acceptance of appointment
        hereunder by a successor Agent; or

               (d) to make provision with respect to the rights of Holders
        pursuant to the requirements of Section 5.4(b) or 5.8; or

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

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        SECTION 8.2 SUPPLEMENTAL AGREEMENTS WITH CONSENT OF HOLDERS.

               (a)  With the consent of the Holders of not less than a majority
        of the outstanding Purchase Contracts voting together as one class, by
        Act of said Holders delivered to the Company and the Agent, the Company,
        when authorized by a Board Resolution, and the Agent may enter into an
        agreement or agreements supplemental hereto for the purpose of modifying
        in any manner the terms of the Purchase Contracts, or the provisions of
        this Agreement or the rights of the Holders in respect of the Units;
        provided, that, except as contemplated herein, no such supplemental
        agreement shall, without the consent of the Holder of each Outstanding
        Unit affected thereby:

                    (1) change any Payment Date;

                    (2) change the amount or the type of Collateral required to
               be Pledged to secure a Holder's Obligations under the Purchase
               Contract, impair the right of the Holder of any Purchase Contract
               to receive distributions on the related Collateral (except for
               the rights of Holders of Normal Units to substitute the Treasury
               Securities for the Pledged Debentures or Pledged Treasury
               Consideration or the rights of holders of Stripped Units to
               substitute Debentures or appropriate Treasury Consideration for
               the Pledged Treasury Securities) or otherwise adversely affect
               the Holder's rights in or to such Collateral or materially
               adversely alter the rights in or to such Collateral;

                    (3) change the place or currency of payment for any amounts
               payable in respect of the Units, increase any amounts payable by
               Holders in respect of the Units or decrease any other amounts
               receivable by Holders in respect of the Units;

                    (4) impair the right to institute suit for the enforcement
               of any Purchase Contract;

                    (5) reduce the number of shares of Common Stock to be
               purchased pursuant to any Purchase Contract, increase the price
               to purchase shares of Common Stock upon settlement of any
               Purchase Contract, change the Stock Purchase Date or otherwise
               adversely affect the Holder's rights under any Purchase Contract;
               or

                    (6) reduce the percentage of the outstanding Purchase
               Contracts the consent of whose Holders is required for any such
               supplemental agreement;

        provided, that if any amendment or proposal referred to above would
        adversely affect only the Normal Units or the Stripped Units, then only
        the affected class of

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        Holder as of the record date for the Holders entitled to vote thereon
        will be entitled to vote on such amendment or proposal, and such
        amendment or proposal shall not be effective except with the consent of
        Holders of not less than a majority of such class.

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

        SECTION 8.3 EXECUTION OF SUPPLEMENTAL AGREEMENTS.

               In executing, or accepting the additional agencies created by,
any supplemental agreement permitted by this Article or the modifications
thereby of the agencies created by this Agreement, the Agent shall be provided
and (subject to Section 7.1) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental agreement is
authorized or permitted by this Agreement. The Agent may, but shall not be
obligated to, enter into any such supplemental agreement which affects the
Agent's own rights, duties or immunities under this Agreement or otherwise.

        SECTION 8.4 EFFECT OF SUPPLEMENTAL AGREEMENTS.

               Upon the execution of any supplemental agreement under this
Article, this Agreement shall be modified in accordance therewith, and such
supplemental agreement shall form a part of this Agreement for all purposes; and
every Holder of Certificates theretofore or thereafter authenticated, executed
on behalf of the Holders and delivered hereunder shall be bound thereby.

        SECTION 8.5 REFERENCE TO SUPPLEMENTAL AGREEMENTS.

               Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Agent, bear a notation in form
approved by the Agent as to any matter provided for in such supplemental
agreement. If the Company shall so determine, new Certificates so modified as to
conform, in the opinion of the Agent and the Company, to any such supplemental
agreement may be prepared and executed by the Company and authenticated,
executed on behalf of the Holders and delivered by the Agent in exchange for
Outstanding Certificates.

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                                   ARTICLE IX

                    CONSOLIDATION, MERGER, SALE OR CONVEYANCE

        SECTION 9.1 COVENANT NOT TO MERGE, CONSOLIDATE, SELL OR CONVEY PROPERTY
                    EXCEPT UNDER CERTAIN CONDITIONS.

        The Company covenants that it will not merge or consolidate with any
other Person in a transaction in which the Company is not the surviving entity
or transfer, lease or convey its properties and assets substantially as an
entirety to any Person or group of affiliated Persons in one transaction or a
series of related transactions, unless (i) the successor (if other than the
Company) shall be a corporation, limited liability company, partnership, trust
or other entity organized and existing under the laws of the United States of
America or a State thereof or the District of Columbia; (ii) such entity shall
expressly assume all the obligations of the Company under the Purchase
Contracts, the Debentures, this Agreement and the Pledge Agreement by one or
more supplemental agreements in form reasonably satisfactory to the Agent and
the Collateral Agent, executed and delivered to the Agent and the Collateral
Agent by such corporation, and (iii) the Company or such successor corporation,
as the case may be, shall not, immediately after such merger or consolidation,
or such transfer, lease or conveyance, be in default in the performance of any
covenant or condition hereunder or under any of the Units or the Pledge
Agreement.

        SECTION 9.2 RIGHTS AND DUTIES OF SUCCESSOR CORPORATION.

               (a) In case of any such consolidation, merger, transfer, lease or
        conveyance and upon any such assumption by a successor corporation in
        accordance with Section 9.1, such successor corporation shall succeed to
        and be substituted for the Company with the same effect as if it had
        been named herein as the Company. Such successor corporation thereupon
        may cause to be signed, and may issue either in its own name or in the
        name of the Company, any or all of the Certificates evidencing Units
        issuable hereunder which theretofore shall not have been signed by the
        Company and delivered to the Agent; and, upon the order of such
        successor corporation, instead of the Company, and subject to all the
        terms, conditions and limitations in this Agreement prescribed, the
        Agent shall authenticate and execute on behalf of the Holders and
        deliver any Certificates which previously shall have been signed and
        delivered by the officers of the Company to the Agent for authentication
        and execution, and any Certificate evidencing Units which such successor
        corporation thereafter shall cause to be signed and delivered to the
        Agent for that purpose. All the Certificates so issued shall in all
        respects have the same legal rank and benefit under this Agreement as
        the Certificates theretofore or thereafter issued in accordance with the
        terms of this Agreement as though all of such Certificates had been
        issued at the date of the execution hereof.

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               (b) In case of any such consolidation, merger, transfer, lease or
        conveyance such change in phraseology and form (but not in substance)
        may be made in the Certificates evidencing Units thereafter to be issued
        as may be appropriate.

        SECTION 9.3 OPINION OF COUNSEL GIVEN TO AGENT.

               The Agent, subject to Sections 7.1 and 7.3, shall receive an
Opinion of Counsel as conclusive evidence that any such consolidation, merger,
sale, assignment, transfer, lease or conveyance, and any such assumption,
complies with the provisions of this Article and that all conditions precedent
to the consummation of any such consolidation, merger, sale, assignment,
transfer, lease or conveyance have been met.

                                   ARTICLE X

                                    COVENANTS

        SECTION 10.1 PERFORMANCE UNDER PURCHASE CONTRACTS.

               The Company covenants and agrees for the benefit of the Holders
from time to time of the Units that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.

        SECTION 10.2 MAINTENANCE OF OFFICE OR AGENCY.

               (a) The Company will maintain in the Borough of Manhattan, The
        City of New York an office or agency where Certificates may be presented
        or surrendered for acquisition of shares of Common Stock upon settlement
        of the Purchase Contracts on any Settlement Date and for transfer of
        Collateral upon occurrence of a Termination Event, where Certificates
        may be surrendered for registration of transfer or exchange, for a
        Collateral Substitution or reestablishment of Normal Units and where
        notices and demands to or upon the Company in respect of the Units and
        this Agreement may be served. The Company will give prompt written
        notice to the Agent of the location, and any change in the location, of
        such office or agency. If at any time the Company shall fail to maintain
        any such required office or agency or shall fail to furnish the Agent
        with the address thereof, such presentations, surrenders, notices and
        demands may be made or served at the Corporate Trust Office, and the
        Company hereby appoints the Agent as its agent to receive all such
        presentations, surrenders, notices and demands.

               (b) The Company may also from time to time designate one or more
        other offices or agencies where Certificates may be presented or
        surrendered for any or all such purposes and may from time to time
        rescind such designations; provided, that no such designation or
        rescission shall in any manner relieve the

                                       69
<PAGE>

        Company of its obligation to maintain an office or agency in the Borough
        of Manhattan, The City of New York for such purposes. The Company will
        give prompt written notice to the Agent of any such designation or
        rescission and of any change in the location of any such other office or
        agency. The Company hereby designates as one place of payment for the
        Units the Corporate Trust Office and appoints State Street Bank and
        Trust Company, N.A., an Affiliate of the Agent, at its corporate trust
        office as co-paying agent in such city.

        SECTION 10.3 COMPANY TO RESERVE COMMON STOCK.

               The Company shall at all times prior to the Stock Purchase Date
reserve and keep available, free from preemptive rights, out of its authorized
but unissued Common Stock the full number of shares of Common Stock issuable
against tender of payment in respect of all Purchase Contracts constituting a
part of the Units evidenced by Outstanding Certificates.

        SECTION 10.4 COVENANTS AS TO COMMON STOCK.

               The Company covenants that all shares of Common Stock which may
be issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Units will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.

        SECTION 10.5 STATEMENTS OF OFFICER OF THE COMPANY AS TO DEFAULT.

               The Company will deliver to the Agent, within 120 days after the
end of each fiscal year of the Company ending after the date hereof, an
Officers' Certificate, stating whether or not to the best knowledge of the
signer thereof the Company is in default in the performance and observance of
any of the terms, provisions and conditions hereof, and if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which such Officer may have knowledge.

                                       70
<PAGE>

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

                                    SOLECTRON CORPORATION

                                    By: /s/ Kiran Patel
                                       ----------------------------------
                                       Name:  Kiran Patel
                                       Title: Executive Vice President,
                                              Chief Financial Officer
                                              (Principal Financial and
                                              Accounting Officer)

                                    STATE STREET BANK AND TRUST COMPANY OF
                                    CALIFORNIA, N.A.,
                                    as Purchase Contract Agent

                                    By: /s/ Steve Rivero
                                       ----------------------------------
                                       Name:  Steve Rivero
                                       Title: Vice President

                                       71
<PAGE>

                                    EXHIBIT A
                        FORM OF NORMAL UNITS CERTIFICATE

               THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF
THE PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED IN
THE NAME OF THE CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT
BE EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER
OF THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.

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

                   (Form of Face of Normal Units Certificate)

No. __                                         CUSIP No. 834182206
Number of Normal Units _________________

               This Normal Units Certificate certifies that ______________ is
the registered Holder of the number of Normal Units set forth above. Each Normal
Unit represents (i) either (a) beneficial ownership by the Holder of one 7.25%
Subordinated Debenture due 2006 (the "Debenture") of Solectron Corporation, a
Delaware corporation (the "Company"), having a principal amount of $25, subject
to the Pledge of such Debenture by such Holder pursuant to the Pledge Agreement,
or (b) if a Tax Event Redemption has occurred or the Debenture has been
remarketed by the Remarketing Agent (or if the Holder has elected not to have
the Debenture remarketed by delivering the appropriate Treasury Consideration
specified by the Remarketing Agent), the appropriate Treasury Consideration,
subject to the Pledge of such Treasury Consideration by such Holder pursuant to
the Pledge Agreement, and (ii) the rights and obligations of the Holder under
one Purchase Contract with the Company. All capitalized terms used herein which
are defined in the Purchase Contract Agreement have the meaning set forth
therein.

               Pursuant to the Pledge Agreement, the Debenture or the
appropriate Treasury Consideration, as the case may be, constituting part of
each Normal Unit evidenced hereby has been pledged to the Collateral Agent, for
the benefit of the

                                      A-1
<PAGE>

Company, to secure the obligations of the Holder under the Purchase Contract
comprising a part of such Normal Unit.

               The Pledge Agreement provides that all payments in respect of the
Pledged Debentures or Pledged Treasury Consideration received by the Collateral
Agent shall be paid by the Collateral Agent by wire transfer in same day funds
(i) in the case of (A) quarterly cash distributions on Normal Units which
include Pledged Debentures or Pledged Treasury Consideration and (B) any
payments in respect of the Debentures or Treasury Consideration, as the case may
be, that have been released from the Pledge pursuant to the Pledge Agreement, to
the Agent to the account designated by the Agent, no later than 12:00 p.m., New
York City time, on the Business Day such payment is received by the Collateral
Agent (provided that in the event such payment is received by the Collateral
Agent on a day that is not a Business Day or after 9:00 a.m., New York City
time, on a Business Day, then such payment shall be made no later than 9:30
a.m., New York City time, on the next succeeding Business Day) and (ii) in the
case of payments in respect of any Pledged Debentures or Pledged Treasury
Consideration, as the case may be, to be paid upon settlement of such Holder's
obligations to purchase Common Stock under the Purchase Contract, to the Company
on the Stock Purchase Date (as defined herein) in accordance with the terms of
the Pledge Agreement, in full satisfaction of the respective obligations of the
Holders of the Normal Units of which such Pledged Debentures or Pledged Treasury
Consideration, as the case may be, are a part under the Purchase Contracts
forming a part of such Normal Units. Quarterly distributions on Normal Units
which include Pledged Debentures or Pledged Treasury Consideration, as the case
may be, which are payable quarterly in arrears on February 15, May 15, August 15
and November 15, each year, commencing February 15, 2002 (a "Payment Date"),
shall, subject to receipt thereof by the Agent from the Collateral Agent, be
paid to the Person in whose name this Normal Units Certificate (or a Predecessor
Normal Units Certificate) is registered at the close of business on the Record
Date for such Payment Date.

               Each Purchase Contract evidenced hereby obligates the Holder of
this Normal Units Certificate to purchase, and the Company to sell, on November
15, 2004 (the "Stock Purchase Date"), at a price equal to $25 (the "Stated
Amount"), a number of shares of Common Stock, $0.001 par value per share
("Common Stock"), of the Company, equal to the Settlement Rate, unless on or
prior to the Stock Purchase Date there shall have occurred a Termination Event
or an Early Settlement or Merger Early Settlement (and the Holder has exercised
its option to settle the Purchase Contract on the Merger Early Settlement Date)
with respect to the Normal Units of which such Purchase Contract is a part, all
as provided in the Purchase Contract Agreement and more fully described on the
reverse hereof. The Purchase Price (as defined herein) for the shares of Common
Stock purchased pursuant to each Purchase Contract evidenced hereby, if not paid
earlier, shall be paid on the Stock Purchase Date by application of payments
received in respect of the Pledged Debentures or the Pledged Treasury
Consideration, as the case may be, pledged to secure the obligations of the
Holder under such Purchase Contract.

                                      A-2
<PAGE>

               Payments on the Debentures or the appropriate Treasury
Consideration, as the case may be, will be payable at the office or agency of
the Agent in The City of New York or, at the option of the Company, by check
mailed to the address of the Person entitled thereto as such address appears on
the Normal Units Register or by wire transfer to an account specified by the
Company.

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

               Unless the certificate of authentication hereon has been executed
by the Agent by manual signature, this Normal Units Certificate shall not be
entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.

                                      A-3
<PAGE>

               IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed.

                                    SOLECTRON CORPORATION

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

                                    HOLDER SPECIFIED ABOVE (as to obligations of
                                    such Holder under the Purchase Contracts
                                    evidenced hereby)

                                    By:  STATE STREET BANK AND TRUST
                                         COMPANY OF CALIFORNIA, N.A.,
                                         not individually but solely as
                                         Attorney-in-Fact of such Holder

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

                                      A-4
<PAGE>

                      AGENT'S CERTIFICATE OF AUTHENTICATION

               This is one of the Normal Units Certificates referred to in the
within mentioned Purchase Contract Agreement.

                                         STATE STREET BANK AND TRUST COMPANY OF
                                         CALIFORNIA, N.A.,
                                         as Purchase Contract Agent

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

                                      A-5
<PAGE>

                  (Form of Reverse of Normal Units Certificate)

               Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of December 27, 2001 (as may be supplemented from
time to time, the "Purchase Contract Agreement"), between the Company and State
Street Bank and Trust Company of California, N.A., as Purchase Contract Agent
(including its successors thereunder, herein called the "Agent"), to which
Purchase Contract Agreement and supplemental agreements thereto reference is
hereby made for a description of the respective rights, limitations of rights,
obligations, duties and immunities thereunder of the Agent, the Company, and the
Holders and of the terms upon which the Normal Units Certificates are, and are
to be, executed and delivered.

               Each Purchase Contract evidenced hereby obligates the Holder of
this Normal Units Certificate to purchase, and the Company to sell, on the Stock
Purchase Date at a price equal to $25 (the "Purchase Price"), a number of shares
of Common Stock of the Company equal to the Settlement Rate, unless, on or prior
to the Stock Purchase Date, there shall have occurred a Termination Event or an
Early Settlement or Merger Early Settlement (and the Holder has exercised its
option to settle the Purchase Contract on the Merger Early Settlement Date) with
respect to the Unit of which such Purchase Contract is a part. The "Settlement
Rate" is equal to (a) if the Applicable Market Value (as defined below) is equal
to or greater than $11.58 (the "Threshold Appreciation Price"), 2.1597 shares of
Common Stock per Purchase Contract, (b) if the Applicable Market Value is less
than the Threshold Appreciation Price but is greater than $9.81, the number of
shares of Common Stock per Purchase Contract equal to the Stated Amount divided
by the Applicable Market Value and (c) if the Applicable Market Value is equal
to or less than $ 9.81, 2.5484 shares of Common Stock per Purchase Contract, in
each case subject to adjustment as provided in the Purchase Contract Agreement.
No fractional shares of Common Stock will be issued upon settlement of Purchase
Contracts, as provided in the Purchase Contract Agreement.

               The "Applicable Market Value" means the average of the Closing
Price per share of Common Stock on, if applicable, each of the 20 consecutive
Trading Days ending on the third Trading Day immediately preceding the Stock
Purchase Date (or, in the event of a Cash Merger contemplated by Section 5.8,
ending on the third Trading Day immediately preceding the date of the
consummation of the Cash Merger).

               The "Closing Price" of the Common Stock on any date of
determination means the closing sale price (or, if no closing price is reported,
the last reported sale price) of the Common Stock on the New York Stock Exchange
(the "NYSE") on such date or, if the Common Stock is not listed for trading on
the NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States national or
regional securities exchange, as reported by The Nasdaq Stock Market, or, if the
Common Stock is not so reported, the last quoted bid price for the Common Stock
in the over-the-counter market as reported by the National Quotation Bureau or
similar organization, or, if such bid price is not available, the market value
of

                                      A-6
<PAGE>

the Common Stock on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the Company.

               A "Trading Day" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.

               Each Purchase Contract evidenced hereby may be settled prior to
the Stock Purchase Date through Early Settlement or Merger Early Settlement, in
accordance with the terms of the Purchase Contract Agreement.

               In accordance with the terms of the Purchase Contract Agreement,
the Holder of this Normal Units Certificate shall pay the Purchase Price for the
shares of Common Stock purchased pursuant to each Purchase Contract evidenced
hereby (i) by effecting an Early Settlement or Merger Early Settlement, (ii) by
application of payments received in respect of the Pledged Treasury
Consideration acquired from the proceeds of a remarketing of the related Pledged
Debentures underlying the Normal Units represented by this Normal Units
Certificate or (iii) if the Holder has elected not to participate in the
remarketing, by application of payments received in respect of the Pledged
Treasury Consideration deposited by such Holder in respect of such Purchase
Contract. If, as provided in the Purchase Contract Agreement, upon the
occurrence of a Last Failed Remarketing the Collateral Agent, for the benefit of
the Company, exercises its rights as a secured creditor with respect to the
Pledged Debentures related to this Normal Units Certificate, any accrued and
unpaid interest on such Pledged Debentures will become payable by the Company to
the Holder of this Normal Units Certificate in the manner provided for in the
Purchase Contract Agreement.

               The Company shall not be obligated to issue any shares of Common
Stock in respect of a Purchase Contract or deliver any certificates therefor to
the Holder unless it shall have received payment in full of the aggregate
Purchase Price for the shares of Common Stock to be purchased thereunder in the
manner herein set forth.

               Under the terms of the Pledge Agreement, the Agent will be
entitled to exercise the voting and any other consensual rights pertaining to
the Pledged Debentures. Upon receipt of notice of any meeting at which holders
of Debentures are entitled to vote or upon the solicitation of consents, waivers
or proxies of holders of Debentures, the Agent shall, as soon as practicable
thereafter, mail to the Holders of Normal Units a notice (a) containing such
information as is contained in the notice or solicitation, (b) stating that each
such Holder on the record date set by the Agent therefor (which, to the extent
possible, shall be the same date as the record date for determining the holders
of Debentures entitled to vote) shall be entitled to instruct the Agent as to
the exercise of the voting rights pertaining to the Pledged Debentures
constituting a part of such Holder's Normal Units and (c) stating the manner in
which such instructions may be given. Upon the written request of the Holders of
Normal Units on such record date, the Agent shall

                                      A-7
<PAGE>

endeavor insofar as practicable to vote or cause to be voted, in accordance with
the instructions set forth in such requests, the maximum number of Pledged
Debentures as to which any particular voting instructions are received. In the
absence of specific instructions from the Holder of a Normal Unit, the Agent
shall abstain from voting the Pledged Debenture evidenced by such Normal Unit.

        Upon the occurrence of a Tax Event Redemption prior to the Stock
Purchase Date, pursuant to the terms of the Pledge Agreement, the Collateral
Agent will apply, out of the aggregate Redemption Price for the Debentures that
are components of Normal Units, an amount equal to the aggregate Redemption
Amount for Debentures that are components of Normal Units to purchase on behalf
of Holders of Normal Units, the Redemption Treasury Portfolio and, promptly
remit the remaining portion of such Redemption Price to the Agent for payment to
the Holders of such Normal Units.

        Following the occurrence of a Tax Event Redemption prior to the Stock
Purchase Date, the Holders of Normal Units and the Collateral Agent shall have
such security interests rights and obligations with respect to the Redemption
Treasury Portfolio as the Holder of Normal Units and the Collateral Agent had in
respect of the Debentures, as the case may be, subject to the Pledge thereof as
provided in Articles II, III, IV, V and VI, of the Pledge Agreement and any
reference herein to the Debentures shall be deemed to be reference to such
Redemption Treasury Portfolio and any reference herein or in the Certificates to
interest on the Debentures shall be deemed to be a reference to corresponding
distributions on the Redemption Treasury Portfolio.

        The Normal Units Certificates are issuable only in registered form and
only in denominations of a single Normal Unit and any integral multiple thereof.
The transfer of any Normal Units Certificate will be registered and Normal Units
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The Normal Units Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents permitted by the Purchase
Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Agent may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. The Holder of a Normal Unit may substitute for
the Pledged Debentures or Pledged Treasury Consideration securing its
obligations under the related Purchase Contract Treasury Securities in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement. From and after such Collateral Substitution, the Unit for which such
Pledged Treasury Securities secures the Holder's obligation under the Purchase
Contract shall be referred to as a "Stripped Unit." A Holder that elects to
substitute a Treasury Security for Pledged Debentures or Pledged Treasury
Consideration, thereby creating Stripped Units, shall be responsible for any
fees or expenses payable in connection therewith. Except as provided in the
Purchase Contract Agreement, for so long as the Purchase Contract underlying a
Normal Unit remains in effect, such Normal Unit shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such Normal
Units in respect of the Pledged Debenture or Pledged Treasury Consideration, as
the case may be, and Purchase Contract

                                      A-8
<PAGE>

constituting such Normal Unit may be transferred and exchanged only as a Normal
Unit.

               A Holder of Stripped Units may reestablish Normal Units by
delivering to the Collateral Agent Debentures or the appropriate Treasury
Consideration in exchange for the release of the Pledged Treasury Securities in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement.

               The Purchase Contracts and all obligations and rights of the
Company and the Holders thereunder, including, without limitation, the rights
and obligations of the Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Agent or the Company, if, on or prior to the Stock Purchase Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Agent, the Collateral Agent and to the
Holders, at their addresses as they appear in the Normal Units Register. Upon
and after the occurrence of a Termination Event, the Collateral Agent shall
release the Pledged Debentures or Pledged Treasury Consideration, as the case
may be, from the Pledge in accordance with the provisions of the Pledge
Agreement.

               Upon registration of transfer of this Normal Units Certificate,
the transferee shall be bound (without the necessity of any other action on the
part of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract Agreement
and the Purchase Contracts evidenced hereby and the transferor shall be released
from the obligations under the Purchase Contracts evidenced by this Normal Units
Certificate. The Company covenants and agrees, and the Holder, by its acceptance
hereof, likewise covenants and agrees, to be bound by the provisions of this
paragraph.

               The Holder of this Normal Units Certificate, by its acceptance
hereof, authorizes the Agent to enter into and perform the related Purchase
Contracts forming part of the Normal Units evidenced hereby on his behalf as his
attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Purchase Contracts by the Company or its trustee in the event
that the Company becomes the subject of a case under the Bankruptcy Code, agrees
to be bound by the terms and provisions thereof, covenants and agrees to perform
such Holder's obligations under such Purchase Contracts, consents to the
provisions of the Purchase Contract Agreement, authorizes the Agent to enter
into and perform the Pledge Agreement on such Holder's behalf as
attorney-in-fact, and consents to the Pledge of the Debentures or the
appropriate Treasury Consideration, as the case may be, underlying this Normal
Units Certificate pursuant to the Pledge Agreement. The Holder further covenants
and agrees, that, to the extent and in the manner provided in the Purchase
Contract Agreement and the Pledge Agreement, but subject to the terms thereof,
payments in respect of the Pledged Debentures or the Pledged Treasury
Consideration, as the case may be, to be paid upon settlement of such Holder's
obligations to purchase Common Stock under the Purchase Contract, shall be paid
on the Stock Purchase Date by the Collateral Agent to the Company in
satisfaction of such Holder's obligations under such Purchase Contract and such
Holder shall acquire

                                      A-9
<PAGE>

no right, title or interest in such payments. The obligations of each Holder to
pay the Purchase Price are non-recourse obligations and except to the extent
paid by Early Settlement or Merger Early Settlement, are payable solely out of
the proceeds of any Collateral pledged to secure the obligations of the Holders
and in no event will Holders be liable for any deficiency between such payments
and the Purchase Price.

               Each Holder of any Unit, and each Beneficial Owner thereof, by
its acceptance thereof or of its interest therein, further agrees to treat (i)
itself as the owner of the related Debentures, Treasury Consideration or
Treasury Securities, as the case may be, and (ii) the Debentures as indebtedness
of the Company, in each case, for all tax purposes.

               Subject to certain exceptions, the provisions of the Purchase
Contract Agreement may be amended with the consent of the Holders of a majority
of the Purchase Contracts.

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

               The Company, the Agent and its Affiliates and any agent of the
Company or the Agent may treat the Person in whose name this Normal Units
Certificate is registered as the owner of the Normal Units evidenced hereby for
the purpose of receiving quarterly payments on the Debentures or the Treasury
Consideration, as the case may be, performance of the Purchase Contracts and for
all other purposes whatsoever, whether or not any payments in respect thereof be
overdue and notwithstanding any notice to the contrary, and neither the Company,
the Agent, such Affiliates nor any such agent shall be affected by notice to the
contrary.

               The Purchase Contracts shall not, prior to the settlement
thereof, entitle the Holder to any of the rights of a holder of shares of Common
Stock.

               A copy of the Purchase Contract Agreement is available for
inspection at the offices of the Agent.

                                      A-10
<PAGE>

                                  ABBREVIATIONS

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

TEN COM -                      as tenants in common

UNIF GIFT MIN ACT -            Custodian

                               --------------------------------
                               (cust)                   (minor)

                               Under Uniform Gifts to Minors Act

                               --------------------------------
                                            (State)

TEN ENT -                      as tenants by the entireties

JT TEN -                       as joint tenants with right of survivorship and
                               not as tenants in common

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

                                      A-11
<PAGE>

                                   ASSIGNMENT

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

________________________________________________________________________________

(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)_______________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

(Please Print or Type Name and Address Including Postal Zip Code of Assignee)

the within Normal Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing ____________________________ attorney to
transfer said Normal Units Certificates on the books of Solectron Corporation
with full power of substitution in the premises.

Dated: ________________                Signature: ______________________________

                                        NOTICE: The signature to this assignment
                                        must correspond with the name as it
                                        appears upon the face of the within
                                        Normal Units Certificates in every
                                        particular, without alteration or
                                        enlargement or any change whatsoever.

Signature Guarantee: ___________________________________________________________

Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the 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 Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

                                      A-12
<PAGE>

                             SETTLEMENT INSTRUCTIONS

               The undersigned Holder directs that a certificate for shares of
Common Stock deliverable upon settlement on or after the Stock Purchase Date of
the Purchase Contracts underlying the number of Normal Units evidenced by this
Normal Units Certificate be registered in the name of, and delivered, together
with a check in payment for any fractional share, to the undersigned at the
address indicated below unless a different name and address have been indicated
below. If shares are to be registered in the name of a Person other than the
undersigned, the undersigned will pay any transfer tax payable incident thereto.

Dated: _________________              Signature: _______________________________

                                      Signature Guarantee: _____________________
                                      (if assigned to another person)

Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the 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 Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

If shares are to be registered in        REGISTERED HOLDER
the name of and delivered to a
Person other than the Holder, please     Please print name and address of
(i) print such Person's name and         Registered Holder:
address and (ii) provide a guarantee
of your signature:

____________________________________     _______________________________________
                Name                                        Name

____________________________________     _______________________________________
               Address                                    Address

Social Security or other Taxpayer Identification
Number, if any

                                      A-13
<PAGE>

                            ELECTION TO SETTLE EARLY

               The undersigned Holder of this Normal Units Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Normal Units evidenced by this Normal Units
Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Normal Units with
an aggregate Stated Amount equal to $1,000 or an integral multiple thereof. The
undersigned Holder directs that a certificate for shares of Common Stock
deliverable upon such Early Settlement be registered in the name of, and
delivered, together with a check in payment for any fractional share and any
Normal Units Certificate representing any Normal Units evidenced hereby as to
which Early Settlement of the related Purchase Contracts is not effected, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. Pledged Debentures or Pledged Treasury Consideration,
as the case may be, deliverable upon such Early Settlement will be transferred
in accordance with the transfer instructions set forth below. If shares are to
be registered in the name of a Person other than the undersigned, the
undersigned will pay any transfer tax payable incident thereto.

Dated: __________________             Signature:_____________________________

Signature Guarantee: ______________   Signature Guarantee: __________________

Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the 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 Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

               Number of Units evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:

If shares of Common Stock are to be     REGISTERED HOLDER
registered in the name of and           Please print name and address of
delivered to and Pledged Debentures,    Registered Holder:
or Pledged Treasury Consideration,
as the case may be, are to be
transferred to a Person other than
the Holder, please print such
Person's name and address:

____________________________________     _______________________________________
                Name                                        Name

____________________________________     _______________________________________
               Address                                    Address

                                      A-14
<PAGE>

Social Security or other Taxpayer
Identification Number, if any

Transfer instructions for Pledged Debentures, or Pledged Treasury Consideration,
as the case may be, transferable upon Early Settlement or a Termination Event:

                                      A-15
<PAGE>

                     [TO BE ATTACHED TO GLOBAL CERTIFICATES]

               SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE

               The following increases or decreases in this Global Certificate
have been made:

<TABLE>
<CAPTION>
                                                         STATED AMOUNT
                       AMOUNT OF         AMOUNT OF       OF THE GLOBAL
                      DECREASE IN       INCREASE IN       CERTIFICATE      SIGNATURE OF
                     STATED AMOUNT     STATED AMOUNT    FOLLOWING SUCH      AUTHORIZED
                     OF THE GLOBAL     OF THE GLOBAL      DECREASE OR      SIGNATORY OF
       DATE           CERTIFICATE       CERTIFICATE        INCREASE           AGENT
-----------------    -------------     -------------    ---------------    ------------
<S>                  <C>               <C>              <C>                <C>

</TABLE>

                                      A-16
<PAGE>

                                    EXHIBIT B
                       FORM OF STRIPPED UNITS CERTIFICATE

               THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF
THE PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED IN
THE NAME OF A CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE
EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER OF
THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.

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

                      Form of Face of Stripped Units Certificate

No. ___                                        CUSIP No. 834182115
Number of Stripped Units ____________

               This Stripped Units Certificate certifies that Cede & Co. is the
registered Holder of the number of Stripped Units set forth above. Each Stripped
Unit represents (i) a 1/40 undivided beneficial ownership interest in a Treasury
Security, subject to the Pledge of such interest in such Treasury Security by
such Holder pursuant to the Pledge Agreement, and (ii) the rights and
obligations of the Holder under one Purchase Contract with Solectron
Corporation, a Delaware corporation (the "Company"). All capitalized terms used
herein which are defined in the Purchase Contract Agreement have the meaning set
forth therein.

               Pursuant to the Pledge Agreement, the Treasury Security
constituting part of each Stripped Unit evidenced hereby has been pledged to the
Collateral Agent, for the benefit of the Company, to secure the obligations of
the Holder under the Purchase Contract comprising a part of such Stripped Unit.

               Each Purchase Contract evidenced hereby obligates the Holder of
this Stripped Units Certificate to purchase, and the Company to sell, on
November 15, 2004 (the "Stock Purchase Date"), at a price equal to $25 (the
"Stated Amount"), a number of

                                      B-1
<PAGE>

shares of Common Stock, $0.001 par value per share ("Common Stock"), of the
Company, equal to the Settlement Rate, unless on or prior to the Stock Purchase
Date there shall have occurred a Termination Event or an Early Settlement or
Merger Early Settlement (and the Holder has exercised its option to settle the
Purchase Contract on the Merger Early Settlement Date) with respect to the
Stripped Units of which such Purchase Contract is a part, all as provided in the
Purchase Contract Agreement and more fully described on the reverse hereof. The
Purchase Price (as defined herein) for the shares of Common Stock purchased
pursuant to each Purchase Contract evidenced hereby, if not paid earlier, shall
be paid on the Stock Purchase Date by application of payments received in
respect of the Pledged Treasury Securities pledged to secure the obligations
under such Purchase Contract in accordance with the terms of the Pledge
Agreement.

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

               Unless the certificate of authentication hereon has been executed
by the Agent by manual signature, this Stripped Units Certificate shall not be
entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.

                                      B-2
<PAGE>

               IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed.

                                    SOLECTRON CORPORATION

                                    By: ____________________________________
                                        Name:
                                        Title:

                                    HOLDER SPECIFIED ABOVE (as to obligations of
                                    such Holder under the Purchase Contracts)

                                    By:  STATE STREET BANK AND TRUST
                                         COMPANY OF CALIFORNIA, N.A., not
                                         individually but solely as
                                         Attorney-in-Fact of such Holder

                                         By:_________________________________
                                            Name:
                                            Title:

                                      B-3
<PAGE>

                      AGENT'S CERTIFICATE OF AUTHENTICATION

               This is one of the Stripped Units referred to in the
within-mentioned Purchase Contract Agreement.

                                          STATE STREET BANK AND TRUST COMPANY OF
                                          CALIFORNIA, N.A. ,
                                          as Purchase Contract Agent

Dated: ___________________                By: ______________________________
                                              Authorized Signatory

                                      B-4
<PAGE>

                     (Reverse of Stripped Units Certificate)

               Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of December 27, 2001 (as may be supplemented from
time to time, the "Purchase Contract Agreement"), between the Company and State
Street Bank and Trust Company of California, N.A., as Purchase Contract Agent
(including its successors thereunder, herein called the "Agent"), to which the
Purchase Contract Agreement and supplemental agreements thereto reference is
hereby made for a description of the respective rights, limitations of rights,
obligations, duties and immunities thereunder of the Agent, the Company and the
Holders and of the terms upon which the Stripped Units Certificates are, and are
to be, executed and delivered.

               Each Purchase Contract evidenced hereby obligates the Holder of
this Stripped Units Certificate to purchase, and the Company to sell, on the
Stock Purchase Date at a price equal to $25 (the "Purchase Price"), a number of
shares of Common Stock of the Company equal to the Settlement Rate, unless, on
or prior to the Stock Purchase Date, there shall have occurred a Termination
Event or an Early Settlement or Merger Early Settlement (and the Holder has
exercised its option to settle the Purcahse Contract on the Merger Early
Settlement Date) with respect to the Unit of which such Purchase Contract is a
part. The "Settlement Rate" is equal to (a) if the Applicable Market Value (as
defined below) is equal to or greater than $11.58 (the "Threshold Appreciation
Price"), 2.1597 shares of Common Stock per Purchase Contract, (b) if the
Applicable Market Value is less than the Threshold Appreciation Price but is
greater than $9.81, the number of shares of Common Stock per Purchase Contract
equal to the Stated Amount divided by the Applicable Market Value and (c) if the
Applicable Market Value is equal to or less than $ 9.81, 2.5484 shares of Common
Stock per Purchase Contract, in each case subject to adjustment as provided in
the Purchase Contract Agreement. No fractional shares of Common Stock will be
issued upon settlement of Purchase Contracts, as provided in the Purchase
Contract Agreement.

               The "Applicable Market Value" means the average of the Closing
Price per share of Common Stock on, if applicable, each of the 20 consecutive
Trading Days ending on the third Trading Day immediately preceding the Stock
Purchase Date (or, in the event of a Cash Merger contemplated by Section 5.8,
ending on the third Trading Day immediately preceding the date of the
consummation of the Cash Merger).

               The "Closing Price" of the Common Stock on any date of
determination means the closing sale price (or, if no closing price is reported,
the last reported sale price) of the Common Stock on the New York Stock Exchange
(the "NYSE") on such date or, if the Common Stock is not listed for trading on
the NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States national or
regional securities exchange, as reported by The Nasdaq Stock Market, or, if the
Common Stock is not so reported, the last quoted bid price for the Common Stock
in the over-the-counter market as reported by the National Quotation

                                      B-5
<PAGE>

Bureau or similar organization, or, if such bid price is not available, the
market value of the Common Stock on such date as determined by a nationally
recognized independent investment banking firm retained for this purpose by the
Company.

               A "Trading Day" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.

               Each Purchase Contract evidenced hereby may be settled prior to
the Stock Purchase Date through Early Settlement or Merger Early Settlement, in
accordance with the terms of the Purchase Contract Agreement.

               In accordance with the terms of the Purchase Contract Agreement,
the Holder of this Stripped Units Certificate shall pay the Purchase Price for
the shares of Common Stock purchased pursuant to each Purchase Contract
evidenced hereby (i) by effecting an Early Settlement or Merger Early Settlement
or (ii) by application of payments received in respect of the Pledged Treasury
Securities underlying the Stripped Units represented by this Stripped Units
Certificate.

               The Company shall not be obligated to issue any shares of Common
Stock in respect of a Purchase Contract or deliver any certificates therefor to
the Holder unless it shall have received payment in full of the aggregate
Purchase Price for the shares of Common Stock to be purchased thereunder in the
manner herein set forth.

The Stripped Units Certificates are issuable only in registered form and only in
denominations of a single Stripped Unit and any integral multiple thereof. The
transfer of any Stripped Units Certificate will be registered and Stripped Units
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The Stripped Units Registrar may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents permitted by the
Purchase Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Agent may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. The Holder of a Stripped Unit may substitute
for the Pledged Treasury Securities securing its obligations under the related
Purchase Contract Debentures or the appropriate Treasury Consideration in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement. From and after such substitution, the Unit for which such Pledged
Debentures or Pledged Treasury Consideration secures the Holder's obligation
under the Purchase Contract shall be referred to as a "Normal Unit." A Holder
that elects to substitute Debentures or the appropriate Treasury Consideration,
as the case may be, for Pledged Treasury Securities, thereby reestablishing
Normal Units, shall be responsible for any fees or expenses payable in
connection therewith. Except as provided in the Purchase Contract Agreement, for
so long as the Purchase Contract underlying a Stripped Unit remains in effect,
such

                                      B-6
<PAGE>

Stripped Unit shall not be separable into its constituent parts, and the rights
and obligations of the Holder of such Stripped Unit in respect of the Pledged
Treasury Security and the Purchase Contract constituting such Stripped Unit may
be transferred and exchanged only as a Stripped Unit.

               A Holder of Stripped Units may reestablish Normal Units by
delivering to the Collateral Agent Debentures or the appropriate Treasury
Consideration in exchange for the release of the Pledged Treasury Securities in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement.

               The Purchase Contracts and all obligations and rights of the
Company and the Holders thereunder, including, without limitation, the rights
and obligations of Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Agent or the Company, if, on or prior to the Stock Purchase Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two business days
thereafter give written notice to the Agent, the Collateral Agent and to the
Holders, at their addresses as they appear in the Stripped Units Register. Upon
and after the occurrence of a Termination Event, the Collateral Agent shall
release the Pledged Treasury Securities from the Pledge in accordance with the
provisions of the Pledge Agreement.

               Upon registration of transfer of this Stripped Units Certificate,
the transferee shall be bound (without the necessity of any other action on the
part of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract Agreement
and the Purchase Contracts evidenced hereby and the transferor shall be released
from the obligations under the Purchase Contracts evidenced by this Stripped
Units Certificate. The Company covenants and agrees, and the Holder, by his
acceptance hereof, likewise covenants and agrees, to be bound by the provisions
of this paragraph.

               The Holder of this Stripped Units Certificate, by his acceptance
hereof, authorizes the Agent to enter into and perform the related Purchase
Contracts forming part of the Stripped Units evidenced hereby on his behalf as
its attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Purchase Contracts by the Company or its trustee in the event
that the Company becomes the subject of a case under the Bankruptcy Code, agrees
to be bound by the terms and provisions thereof, covenants and agrees to perform
such Holder's obligations under such Purchase Contracts, consents to the
provisions of the Purchase Contract Agreement, authorizes the Agent to enter
into and perform the Pledge Agreement on such Holder's behalf as
attorney-in-fact, and consents to the Pledge of the Treasury Securities
underlying this Stripped Units Certificate pursuant to the Pledge Agreement. The
Holder further covenants and agrees, that, to the extent and in the manner
provided in the Purchase Contract Agreement and the Pledge Agreement, but
subject to the terms thereof, payments in respect of the Pledged Treasury
Securities, to be paid upon settlement of

                                      B-7
<PAGE>

such Holder's obligations to purchase Common Stock under the Purchase Contract,
shall be paid on the Stock Purchase Date by the Collateral Agent to the Company
in satisfaction of such Holder's obligations under such Purchase Contract and
such Holder shall acquire no right, title or interest in such payments. The
obligations of each Holder to pay the Purchase Price are non-recourse
obligations and except to the extent paid by Early Settlement or Merger Early
Settlement, are payable solely out of the proceeds of any Collateral pledged to
secure the obligations of the Holders and in no event will Holders be liable for
any deficiency between such payments and the Purchase Price.

               Each Holder of any Unit, and each Beneficial Owner thereof, by
its acceptance thereof or of its interest therein, further agrees to treat (i)
itself as the owner of the related Debentures, Treasury Consideration or
Treasury Securities, as the case may be, and (ii) the Debentures as indebtedness
of the Company, in each case, for all tax purposes.

               Subject to certain exceptions, the provisions of the Purchase
Contract Agreement may be amended with the consent of the Holders of a majority
of the Purchase Contracts.

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

               The Company, the Agent and its Affiliates and any agent of the
Company or the Agent may treat the Person in whose name this Stripped Units
Certificate is registered as the owner of the Stripped Units evidenced hereby
for the purpose of performance of the Purchase Contracts and for all other
purposes whatsoever, whether or not any payments in respect thereof be overdue
and notwithstanding any notice to the contrary, and neither the Company, the
Agent, such Affiliate, nor any such agent shall be affected by notice to the
contrary.

               The Purchase Contracts shall not, prior to the settlement
thereof, entitle the Holder to any of the rights of a holder of shares of Common
Stock.

               A copy of the Purchase Contract Agreement is available for
inspection at the offices of the Agent.

                                      B-8
<PAGE>

                                  ABBREVIATIONS

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

TEN COM -                      as tenants in common

UNIF GIFT MIN ACT -            Custodian

                               __________________________________
                               (cust)                     (minor)

                               Under Uniform Gifts to Minors Act

                               __________________________________
                                            (State)

TEN ENT -                      as tenants by the entireties

JT TEN -                       as joint tenants with right of survivorship and
                               not as tenants in common

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

                                      B-9
<PAGE>

                                   ASSIGNMENT

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

________________________________________________________________________________

(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee) ______________________________________________________________________

________________________________________________________________________________

(Please Print or Type Name and Address Including Postal Zip Code of Assignee)

the within Stripped Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing___________________attorney to transfer
said Stripped Units Certificates on the books of Solectron Corporation with full
power of substitution in the premises.

Dated: _________________                 Signature: ____________________________

                                         NOTICE: The signature to this
                                         assignment must correspond with the
                                         name as it appears upon the face of the
                                         within Stripped Units Certificates in
                                         every particular, without alteration or
                                         enlargement or any change whatsoever.

Signature Guarantee: ___________________________________________________________

Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the 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 Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

                                      B-10
<PAGE>

                             SETTLEMENT INSTRUCTIONS

               The undersigned Holder directs that a certificate for shares of
Common Stock deliverable upon settlement on or after the Stock Purchase Date of
the Purchase Contracts underlying the number of Stripped Units evidenced by this
Stripped Units Certificate be registered in the name of, and delivered, together
with a check in payment for any fractional share, to the undersigned at the
address indicated below unless a different name and address have been indicated
below. If shares are to be registered in the name of a Person other than the
undersigned, the undersigned will pay any transfer tax payable incident thereto.

Dated:                                         Signature:_______________________
       -------------------
                                               Signature Guarantee:_____________
                                               (if assigned to another person)

Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the 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 Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

If shares are to be registered in         REGISTERED HOLDER
the name of and delivered to a
Person other than the Holder, please      Please print name and address of
(i) print such Person's name and          Registered Holder:
address and (ii) provide a guarantee
of your signature:

____________________________________     _______________________________________
                Name                                        Name

____________________________________     _______________________________________
               Address                                    Address

Social Security or other Taxpayer
Identification Number, if any

                                      B-11
<PAGE>

                            ELECTION TO SETTLE EARLY

               The undersigned Holder of this Stripped Units Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Stripped Units evidenced by this Stripped
Units Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Stripped Units with
an aggregate Stated Amount equal to $1,000 or an integral multiple thereof. The
undersigned Holder directs that a certificate for shares of Common Stock
deliverable upon such Early Settlement be registered in the name of, and
delivered, together with a check in payment for any fractional share and any
Stripped Units Certificate representing any Stripped Units evidenced hereby as
to which Early Settlement of the related Purchase Contracts is not effected, to
the undersigned at the address indicated below unless a different name and
address have been indicated below. Pledged Treasury Securities deliverable upon
such Early Settlement will be transferred in accordance with the transfer
instructions set forth below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.

Dated: __________________           Signature: _______________________________

                                    Signature Guarantee: _____________________

Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the 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 Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

               Number of Units evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:

If shares of Common Stock are to be       REGISTERED HOLDER
registered in the name of and
delivered to and Pledged Treasury         Please print name and address of
Securities are to be transferred to       Registered Holder:
a Person other than the Holder,
please print such Person's name and
address:

____________________________________     _______________________________________
                Name                                        Name

____________________________________     _______________________________________
               Address                                    Address

Social Security or other Taxpayer
Identification Number, if any

                                      B-12
<PAGE>

Transfer instructions for Pledged Treasury Securities, transferable upon Early
Settlement or a Termination Event:

                                      B-13
<PAGE>

                     [TO BE ATTACHED TO GLOBAL CERTIFICATES]

               SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE

               The following increases or decreases in this Global Certificate
have been made:

<TABLE>
<CAPTION>
                                                         STATED AMOUNT
                       AMOUNT OF         AMOUNT OF       OF THE GLOBAL
                      DECREASE IN       INCREASE IN       CERTIFICATE      SIGNATURE OF
                     STATED AMOUNT     STATED AMOUNT    FOLLOWING SUCH      AUTHORIZED
                     OF THE GLOBAL     OF THE GLOBAL      DECREASE OR      SIGNATORY OF
       DATE           CERTIFICATE       CERTIFICATE        INCREASE           AGENT
----------------     -------------     -------------    ---------------    ------------
<S>                  <C>               <C>              <C>                <C>

</TABLE>

                                      B-14
<PAGE>

                                    EXHIBIT C

                      INSTRUCTION FROM PURCHASE CONTRACT AGENT TO
                                COLLATERAL AGENT

U.S. Bank, N.A.
180 East Fifth Street
St. Paul, MN 55101
Attn: Corporate Trust Services/Frank Leslie

[Addressee]

Attention:

        Re:    Equity Security Units of Solectron Corporation  (the "Company")

               We hereby notify you in accordance with Section 4.1 of the Pledge
Agreement, dated as of December 27, 2001, among the Company, you, as Collateral
Agent, Custodial Agent and Securities Intermediary, and us, as Purchase Contract
Agent and as attorney-in-fact for the holders of [Normal Units] [Stripped Units]
from time to time, that the holder of securities listed below (the "Holder") has
elected to substitute [$ _______ aggregate principal amount of Treasury
Securities (CUSIP No. _____)] [$_______ principal amount of Debentures or the
appropriate Treasury Consideration, as the case may be,] in exchange for the
related [Pledged Debentures or Pledged Treasury Consideration, as the case may
be (CUSIP No. ____),] [Pledged Treasury Securities] held by you in accordance
with the Pledge Agreement and has delivered to us a notice stating that the
Holder has transferred [Treasury Securities] [Debentures or the appropriate
Treasury Consideration, as the case may be,] to you, as Collateral Agent. We
hereby instruct you, upon receipt of such [Pledged Treasury Securities] [Pledged
Debentures or Pledged Treasury Consideration, as the case may be], and upon the
payment by such Holder of any applicable fees, to release the [Debentures or
Treasury Consideration, as the case may be,] [Treasury Securities] related to
such [Normal Units] [Stripped Units] to us in accordance with the Holder's
instructions.

Date: __________________

                                   STATE STREET BANK AND TRUST COMPANY OF
                                   CALIFORNIA, N.A.,
                                   As Purchase Contract Agent under the Purchase
                                   Contract Agreement, dated as of December 27,
                                   2001, between the Company and the Purchase
                                   Contract Agent

                                   By: ____________________________

                                       C-1
<PAGE>

                                        Name:
                                        Title:

                                      C-2
<PAGE>

Please print name and address of Registered Holder electing to substitute
[Treasury Securities] [Debentures or Pledged Treasury Consideration, as the case
may be,] for the [Pledged Debentures or Pledged Treasury Consideration, as the
case may be,] [Pledged Treasury Securities]:

        Name

        Address

Social Security or other Taxpayer
Identification Number, if any

                                      C-3
<PAGE>

                                    EXHIBIT D

                     INSTRUCTION TO PURCHASE CONTRACT AGENT

State Street Bank and Trust Company of California, N.A.
633 West 5th Street, 12th Floor
Los Angeles, CA 90071
Attention: Corporate Trust Administration
(Solectron Corporation 2001 Pledge Agreement)

        Re:    Equity Security Units of Solectron Corporation (the "Company")

               The undersigned Holder hereby notifies you, as Purchase Contract
Agent under the Purchase Contract Agreement, dated as of December 27, 2001,
between the Company and you, that it has delivered to U.S. Bank, N.A., as
Collateral Agent, Custodial Agent and Securities Intermediary [$_________
aggregate principal amount of Treasury Securities] [$_________ principal amount
of Debentures or the appropriate Treasury Consideration, as the case may be,] in
exchange for the related [Pledged Debentures or Pledged Treasury Consideration
as the case may be,] [Pledged Treasury Securities] held by the Collateral Agent,
in accordance with Section 4.1 of the Pledge Agreement, dated as of December 27,
2001, among you, the Company and the Collateral Agent. The undersigned Holder
has paid the Collateral Agent all applicable fees relating to such exchange. The
undersigned Holder hereby instructs you to instruct the Collateral Agent to
release to you on behalf of the undersigned Holder the [Pledged Debentures or
Pledged Treasury Consideration, as the case may be,] [Pledged Treasury
Securities] related to such [Normal Units] [Stripped Units].

Date:
                                        By: ___________________________________

                                        Signature Guarantee: __________________
Dated:

Please print name and address of Registered Holder:

Name                                    Social Security or other Taxpayer
                                        Identification Number, if any

Address

Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature

                                      D-1
<PAGE>

guarantee program" as may be determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange Act of
1934, as amended.

                                      D-2<PAGE>

                                                                     EXHIBIT 4.7

                              SOLECTRON CORPORATION

                                 U.S. BANK, N.A.

                      AS COLLATERAL AGENT, CUSTODIAL AGENT

                           AND SECURITIES INTERMEDIARY

                                       AND

             STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A.

                           AS PURCHASE CONTRACT AGENT

                                PLEDGE AGREEMENT

                          DATED AS OF DECEMBER 27, 2001

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<S>                                                                                       <C>
ARTICLE I DEFINITIONS.................................................................     2

    SECTION 1.1 Definitions...........................................................     2

ARTICLE II PLEDGE; CONTROL AND PERFECTION.............................................     4

    SECTION 2.1 The Pledge............................................................     4
    SECTION 2.2 Control and Perfection................................................     5

ARTICLE III PAYMENTS ON PLEDGED COLLATERAL............................................     7

    SECTION 3.1 Payments..............................................................     7
    SECTION 3.2 Application of Payments...............................................     8

ARTICLE IV SUBSTITUTION, RELEASE, REPLEDGE AND SETTLEMENT OF DEBENTURES...............     9

    SECTION 4.1 Collateral Substitution and the Creation of Stripped
                      Units...........................................................     9
    SECTION 4.2 Collateral Substitution and the Re-Creation of Normal
                      Units...........................................................    10
    SECTION 4.3 Termination Event.....................................................    10
    SECTION 4.4 Early Settlement; Merger Early Settlement.............................    11
    SECTION 4.5 Remarketing; Application of Proceeds; Settlement......................    12

ARTICLE V VOTING RIGHTS -- DEBENTURES.................................................    14

    SECTION 5.1 Exercise by Purchase Contract Agent...................................    14

ARTICLE VI RIGHTS AND REMEDIES; TAX EVENT REDEMPTION..................................    15

    SECTION 6.1 Rights and Remedies of the Collateral Agent...........................    15
    SECTION 6.2 Substitutions.........................................................    16
    SECTION 6.3 Tax Event Redemption..................................................    16

ARTICLE VII REPRESENTATIONS AND WARRANTIES; COVENANTS.................................    17

    SECTION 7.1 Representations and Warranties of the Holders.........................    17
    SECTION 7.2 Representations and Warranties of the Collateral Agent,
                      Custodial Agent and Securities Intermediary.....................    17
</TABLE>

                                       i
<PAGE>

<TABLE>
<S>                                                                                       <C>
    SECTION 7.3 Covenants.............................................................    18

ARTICLE VIII THE COLLATERAL AGENT.....................................................    18

    SECTION 8.1 Appointment, Powers and Immunities....................................    18
    SECTION 8.2 Instructions of the Company...........................................    20
    SECTION 8.3 Reliance..............................................................    20
    SECTION 8.4 Rights in Other Capacities............................................    21
    SECTION 8.5 Non-Reliance on Collateral Agent......................................    21
    SECTION 8.6 Compensation and Indemnity............................................    22
    SECTION 8.7 Failure to Act........................................................    22
    SECTION 8.8 Resignation...........................................................    23
    SECTION 8.9 Right to Appoint Agent or Advisor.....................................    24
    SECTION 8.10 Survival.............................................................    25
    SECTION 8.11 Exculpation..........................................................    25

ARTICLE IX AMENDMENT..................................................................    25

    SECTION 9.1 Amendment Without Consent of Holders..................................    25
    SECTION 9.2 Amendment with Consent of Holders.....................................    26
    SECTION 9.3 Execution of Amendments...............................................    26
    SECTION 9.4 Effect of Amendments..................................................    27
    SECTION 9.5 Reference to Amendments...............................................    27

ARTICLE X MISCELLANEOUS...............................................................    27

    SECTION 10.1 No Waiver............................................................    27
    SECTION 10.2 GOVERNING LAW........................................................    27
    SECTION 10.3 Notices..............................................................    28
    SECTION 10.4 Successors and Assigns...............................................    28
    SECTION 10.5 Counterparts.........................................................    28
    SECTION 10.6 Severability.........................................................    29
    SECTION 10.7 Expenses, Etc........................................................    29
    SECTION 10.8 Security Interest Absolute...........................................    29
    SECTION 10.9 Waiver of Jury Trial.................................................    30
</TABLE>

EXHIBIT A  Instruction from Purchase Contract Agent to Collateral Agent

EXHIBIT B  Instruction to Purchase Contract Agent

EXHIBIT C  Instruction to Custodial Agent Regarding Remarketing

EXHIBIT D  Instruction to Custodial Agent Regarding Withdrawal from Remarketing

                                       ii
<PAGE>

                                PLEDGE AGREEMENT

       PLEDGE AGREEMENT, dated as of December 27, 2001 (this "Agreement"), among
Solectron Corporation, a Delaware corporation (the "Company"), U.S. Bank, N.A.,
a national banking association duly organized and validly existing under the
laws of the United States, not individually but solely as collateral agent (in
such capacity, together with its successors in such capacity, the "Collateral
Agent"), as custodial agent (in such capacity, together with its successors in
such capacity, the "Custodial Agent") and as "securities intermediary" as
defined in Section 8-102(a)(14) of the Code (as defined herein) (in such
capacity, together with its successors in such capacity, the "Securities
Intermediary"), and State Street Bank and Trust Company of California, N.A., a
national banking association, not individually but solely as purchase contract
agent and as attorney-in-fact of the Holders from time to time of the Units (in
such capacity, together with its successors in such capacity, the "Purchase
Contract Agent") under the Purchase Contract Agreement (as defined herein).

                                    RECITALS

       WHEREAS, the Company and the Purchase Contract Agent are parties to the
Purchase Contract Agreement, dated as of the date hereof (as modified and
supplemented and in effect from time to time, the "Purchase Contract
Agreement"), pursuant to which there may be issued Units having a Stated Amount
of $25 per Unit, all of which will initially be Normal Units.

       WHEREAS, each Normal Unit will be comprised of (a) a Purchase Contract
and (b) either beneficial ownership of (i) a Debenture or (ii) following a Tax
Event Redemption or a successful remarketing of the Debentures in accordance
with the Purchase Contract Agreement and the Remarketing Agreement, the
appropriate Treasury Consideration.

       WHEREAS, in accordance with the terms of the Purchase Contract Agreement,
a holder of Normal Units may separate the Debentures or the appropriate Treasury
Consideration, as applicable, from the related Purchase Contracts by
substituting for such Debentures or the appropriate Treasury Consideration, as
the case may be, Treasury Securities that will pay in the aggregate an amount
equal to the aggregate Stated Amount of such Normal Units. Upon such separation,
the Normal Units will become Stripped Units. Each Stripped Unit will be
comprised of (a) a Purchase Contract and (b) a 1/40 undivided beneficial
interest in a Treasury Security.

       WHEREAS, pursuant to the terms of the Purchase Contract Agreement and the
Purchase Contracts, the Holders, from time to time, of the Units have
irrevocably authorized the Purchase Contract Agent, as attorney-in-fact of such
Holders, among other things, to execute and deliver this Agreement on behalf of
such Holders and to grant the pledge provided hereby of the Debentures, any
Treasury Consideration and any Treasury Securities delivered in exchange
therefor to secure each Holder's obligations under the related Purchase
Contract, as provided herein and subject to the terms hereof.

<PAGE>

       NOW, THEREFORE, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Company, the
Collateral Agent, the Securities Intermediary, the Custodial Agent and the
Purchase Contract Agent, on its own behalf and as attorney-in-fact of the
Holders from time to time of the Units, agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

       SECTION 1.1 Definitions.

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

       (a) capitalized terms used but not defined herein are used as defined in
   the Purchase Contract Agreement;

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

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

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

       "Code" has the meaning specified in Section 6.1 hereof.

       "Collateral" has the meaning specified in Section 2.1 hereof.

       "Collateral Account" means the securities account (number 22100410)
maintained at the Security Intermediary in the name "U.S. Bank, N.A., as
Collateral Agent, for the benefit of Solectron Corporation, as pledgee," and any
successor account.

       "Collateral Agent" has the meaning specified in the first paragraph of
this Agreement.

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

       "Custodial Agent" has the meaning specified in the first paragraph of
this Agreement.

                                      -2-
<PAGE>

       "Intermediary" means any entity that in the ordinary course of its
business maintains securities accounts for others and is acting in that
capacity.

       "Pledge" has the meaning specified in Section 2.1 hereof.

       "Pledged Debentures" has the meaning specified in Section 2.1 hereof.

       "Pledged Treasury Consideration" has the meaning specified in Section 2.1
hereof.

       "Pledged Treasury Securities" has the meaning specified in Section 2.1
hereof.

       "Proceeds" means all interest, dividends, cash, instruments, securities,
financial assets (as defined in Section 8-102(a)(9) of the Code) and other
property from time to time received, receivable or otherwise distributed upon
the sale, exchange, collection or disposition of the Collateral or any proceeds
thereof.

       "Purchase Contract Agent" has the meaning specified in the first
paragraph of this Agreement.

       "Purchase Contract Agreement" has the meaning specified in the Recitals.

       "Securities Intermediary" has the meaning specified in the first
paragraph of this Agreement.

       "Security Entitlement" has the meaning set forth in Section 8-102(a) (17)
of the Code.

       "Separate Debentures" means any Debentures that are not Pledged
Debentures.

       "TRADES Regulations" means the regulations of the United States
Department of the Treasury, published at 31 C.F.R. Part 357, as amended from
time to time. Unless otherwise defined herein, all terms defined in the TRADES
Regulations are used herein as therein defined.

       "Transfer" means, with respect to the Collateral and in accordance with
the instructions of the Collateral Agent, the Purchase Contract Agent or the
Holder, as applicable:

       (i) in the case of Collateral consisting of securities which cannot be
   delivered by book-entry or which the parties agree are to be delivered in
   physical form, delivery in appropriate physical form to the recipient
   accompanied by any duly executed instruments of transfer, assignments in
   blank, transfer tax stamps and any other documents necessary to constitute a
   legally valid transfer to the recipient;

       (ii) in the case of Collateral consisting of securities maintained in
   book-entry form by causing a "securities intermediary" (as defined in Section
   8-102(a)(14) of the

                                      -3-
<PAGE>

   Code) to (a) credit a "security entitlement" (as defined in Section
   8-102(a)(17) of the Code) with respect to such securities to a "securities
   account" (as defined in Section 8-501(a) of the Code) maintained by or on
   behalf of the recipient and (b) to issue a confirmation to the recipient with
   respect to such credit. In the case of Collateral to be delivered to the
   Collateral Agent, the securities intermediary shall be the Securities
   Intermediary and the securities account shall be the Collateral Account. In
   addition, any Transfer of Treasury Securities and Treasury Consideration
   hereunder shall be made in accordance with the TRADES Regulations and other
   applicable law.

                                   ARTICLE II

                         PLEDGE; CONTROL AND PERFECTION

       SECTION 2.1 The Pledge.

       (a) The Holders from time to time acting through the Purchase Contract
   Agent, as their attorney-in-fact, and the Purchase Contract Agent, as such
   attorney-in-fact, hereby pledge and grant to the Collateral Agent, for the
   benefit of the Company, as collateral security for the performance when due
   by such Holders of their respective obligations under the related Purchase
   Contracts, a security interest in all of the right, title and interest of the
   Purchase Contract Agent and such Holders in:

       (i)    (A) the Debentures, Treasury Consideration and Treasury
              Securities, as the case may be, constituting a part of the Units,
              (B) any Treasury Securities delivered in exchange for any
              Debentures or Treasury Consideration, as applicable, in accordance
              with Section 4.1 hereof, and (C) any Debentures or Treasury
              Consideration, as applicable, delivered in exchange for any
              Treasury Securities in accordance with Section 4.2 hereof, in each
              case that have been Transferred to or otherwise received by the
              Collateral Agent and not released by the Collateral Agent to such
              Holders under the provisions of this Agreement;

       (ii)   the Collateral Account and all securities, financial assets,
              security entitlements, cash and other property credited thereto
              and all Security Entitlements related thereto;

       (iii)  the Redemption Treasury Portfolio purchased on behalf of the
              Holders of Normal Units by the Collateral Agent upon the
              occurrence of a Tax Event Redemption as provided in Section 6.3;
              and

       (iv)   all Proceeds of the foregoing (all of the foregoing, collectively,
              the "Collateral").

                                      -4-
<PAGE>

       (b) Prior to or concurrently with the execution and delivery of this
Agreement, the Purchase Contract Agent, on behalf of the initial Holders of the
Units, shall cause the Debentures comprising a part of the Normal Units to be
Transferred to the Collateral Agent for the benefit of the Company.

       (c) The pledge provided in this Section 2.1 is herein referred to as the
"Pledge" and the Debentures (or the Debentures that are delivered pursuant to
Section 6.2 hereof), Treasury Consideration or Treasury Securities subject to
the Pledge, excluding any Debentures, Treasury Consideration or Treasury
Securities released from the Pledge as provided in Sections 4.1, 4.2 and 6.3
hereof are hereinafter referred to as "Pledged Debentures," "Pledged Treasury
Consideration" or the "Pledged Treasury Securities," respectively. Subject to
the Pledge and the provisions of Section 2.2 hereof, the Holders from time to
time shall have full beneficial ownership of the Collateral. For purposes of
perfecting the Pledge under applicable law, including, to the extent applicable,
the TRADES Regulations or the Uniform Commercial Code as adopted and in effect
in any applicable jurisdiction, the Collateral Agent shall be the agent of the
Company as provided herein. Whenever directed by the Collateral Agent acting on
behalf of the Company, the Securities Intermediary shall have the right to
reregister the Debentures or any other securities held in physical form in its
name.

       (d) Except as may be required in order to release Debentures or Treasury
Consideration, as applicable, in connection with a Holder's election to convert
its investment from a Normal Unit to a Stripped Unit, or except as otherwise
required to release Debentures as specified herein, neither the Collateral
Agent, the Custodial Agent nor the Securities Intermediary shall relinquish
physical possession of any certificate evidencing a Debenture prior to the
termination of this Agreement. If it becomes necessary for the Securities
Intermediary to relinquish physical possession of a certificate in order to
release a portion of the Debentures evidenced thereby from the Pledge, the
Securities Intermediary shall use its best efforts to obtain physical possession
of a replacement certificate evidencing any Debentures remaining subject to the
Pledge hereunder registered to it or endorsed in blank within fifteen days of
the date it relinquished possession. The Securities Intermediary shall promptly
notify the Company and the Collateral Agent of the Securities Intermediary's
inability to obtain possession of any such replacement certificate as required
hereby.

       SECTION 2.2 Control and Perfection.

       (a) In connection with the Pledge granted in Section 2.1, and subject to
the other provisions of this Agreement, the Holders from time to time acting
through the Purchase Contract Agent, as their attorney-in-fact, hereby authorize
and direct the Securities Intermediary (without the necessity of obtaining the
further consent of the Purchase Contract Agent or any of the Holders), and the
Securities Intermediary agrees, to comply with and follow any instructions and
entitlement orders (as defined in Section 8-102(a)(8) of the Code) that the
Collateral Agent may deliver upon the written direction of the Company with
respect to the Collateral Account, the Collateral credited thereto and

                                      -5-
<PAGE>

any Security Entitlements with respect to any thereof. In the event the
Securities Intermediary receives from the Holders or the Purchase Contract Agent
entitlement orders which conflict with entitlement orders received from the
Collateral Agent, the Securities Intermediary shall follow the entitlement
orders received from the Collateral Agent. Such instructions and entitlement
orders may, without limitation, direct the Securities Intermediary to transfer,
redeem, assign, or otherwise deliver the Debentures, the Treasury Consideration,
the Treasury Securities, and any Security Entitlements with respect thereto or
sell, liquidate or dispose of such assets through a broker designated by the
Company, and to pay and deliver any income, proceeds or other funds derived
therefrom to the Company. The Holders from time to time acting through the
Purchase Contract Agent hereby further authorize and direct the Collateral
Agent, as agent of the Company, to, upon written direction of the Company,
itself issue instructions and entitlement orders, and otherwise to take action,
with respect to the Collateral Account, the Collateral credited thereto and any
Security Entitlements with respect thereto, pursuant to the terms and provisions
hereof, all without the necessity of obtaining the further consent of the
Purchase Contract Agent or any of the Holders. The Collateral Agent shall be the
agent of the Company and shall act as directed in writing by the Company.
Without limiting the generality of the foregoing, the Collateral Agent shall
issue entitlement orders to the Securities Intermediary when and as directed in
writing by the Company.

       (b) The Securities Intermediary hereby confirms and agrees that:

       (i)    all securities or other property underlying any financial assets
              credited to the Collateral Account shall be registered in the name
              of the Securities Intermediary, or its nominee, indorsed to the
              Securities Intermediary, or its nominee, or in blank or credited
              to another Collateral Account maintained in the name of the
              Securities Intermediary and in no case will any financial asset
              credited to the Collateral Account be registered in the name of
              the Purchase Contract Agent, the Collateral Agent, the Company or
              any Holder, payable to the order of, or specially indorsed to, the
              Purchase Contract Agent, the Collateral Agent, the Company or any
              Holder except to the extent the foregoing have been specially
              indorsed to the Securities Intermediary or in blank;

       (ii)   all property delivered to the Securities Intermediary pursuant to
              this Pledge Agreement (including, without limitation, any
              Debentures, the Treasury Consideration or Treasury Securities)
              will be promptly credited to the Collateral Account;

       (iii)  the Collateral Account is an account to which financial assets are
              or may be credited, and the Securities Intermediary shall, subject
              to the terms of this Agreement, treat the Purchase Contract Agent
              as entitled to exercise the rights of any financial asset credited
              to the Collateral Account;

                                      -6-
<PAGE>

       (iv)   the Securities Intermediary has not entered into, and until the
              termination of this Agreement will not enter into, any agreement
              with any other person relating to the Collateral Account and/or
              any financial assets credited thereto pursuant to which it has
              agreed to comply with entitlement orders (as defined in Section
              8-102(a)(8) of the Code) of such other person; and

       (v)    the Securities Intermediary has not entered into, and until the
              termination of this Agreement will not enter into, any agreement
              with the Company, the Collateral Agent or the Purchase Contract
              Agent purporting to limit or condition the obligation of the
              Securities Intermediary to comply with entitlement orders as set
              forth in this Section 2.2 hereof.

       (c) The Securities Intermediary hereby agrees that each item of property
(whether investment property, financial asset, security, instrument or cash)
credited to the Collateral Account shall be treated as a "financial asset"
within the meaning of Section 8-102(a)(9) of the Code.

       (d) In the event of any conflict between this Agreement (or any portion
thereof) and any other agreement now existing or hereafter entered into, the
terms of this Agreement shall prevail.

       (e) The Purchase Contract Agent hereby irrevocably constitutes and
appoints the Collateral Agent and the Company, with full power of substitution,
as the Purchase Contract Agent's attorney-in-fact to take on behalf of, and in
the name, place and stead of the Purchase Contract Agent and the Holders, any
action necessary or desirable to perfect and to keep perfected the security
interest in the Collateral referred to in Section 2.1. The grant of such
power-of-attorney shall not be deemed to require of the Collateral Agent any
specific duties or obligations not otherwise assumed by the Collateral Agent
hereunder. Notwithstanding the foregoing, in no event shall the Collateral Agent
or Securities Intermediary be responsible for the preparation or filing of any
financing or continuation statements in the appropriate jurisdictions or
responsible for maintenance or perfection of any Security Interest hereunder.

                                   ARTICLE III

                         PAYMENTS ON PLEDGED COLLATERAL

       SECTION 3.1 Payments.

       So long as the Purchase Contract Agent is the registered owner of the
Pledged Debentures or Pledged Treasury Consideration, it shall receive all
payments thereon. If the Pledged Debentures or Pledged Treasury Consideration
are reregistered, such that the Collateral Agent becomes the registered holder,
all payments of the principal of, or interest on, the Pledged Debentures and all
payments of the principal of, or cash distributions on, any Pledged Treasury
Consideration, and in any event all payments of

                                      -7-
<PAGE>

principal of Pledged Treasury Securities, that are received by the Collateral
Agent and that are properly payable hereunder shall be paid by the Collateral
Agent by wire transfer in same day funds:

       (i)    in the case of (A) quarterly cash distributions on Normal Units
              which include Pledged Debentures or Pledged Treasury Consideration
              and (B) any payments with respect to any Debentures or Treasury
              Consideration, as the case may be, that have been released from
              the Pledge pursuant to Section 4.3 hereof, to the Purchase
              Contract Agent, for the benefit of the relevant Holders of the
              Normal Units, to the account designated by the Purchase Contract
              Agent for such purpose (State Street Bank and Trust Company; ABA
              011-00-0028; Account Name: Solectron Corporation; Account No.
              9900-298-2, unless and until advised otherwise by the Purchase
              Contract Agent), no later than 12:00 p.m., New York City time, on
              the Business Day such payment is received by the Collateral Agent
              (provided that in the event such payment or payment instructions
              are received by the Collateral Agent on a day that is not a
              Business Day or after 9:00 a.m., New York City time, on a Business
              Day, then such payment shall be made no later than 9:30 a.m., New
              York City time, on the next succeeding Business Day);

       (ii)   in the case of any payments with respect to any Treasury
              Securities that have been released from the Pledge pursuant to
              Section 4.3 hereof, to the Holders of the Stripped Units to the
              accounts designated by the Purchase Contract Agent in writing for
              such purpose no later than 2:00 p.m., New York City time, on the
              Business Day such payment is received by the Collateral Agent
              (provided that in the event such payment or payment instructions
              are received by the Collateral Agent on a day that is not a
              Business Day or after 10:00 a.m., New York City time, on a
              Business Day, then such payment shall be made no later than 10:30
              a.m., New York City time, on the next succeeding Business Day);
              and

       (iii)  in the case of payments in respect of any Pledged Debentures,
              Pledged Treasury Consideration or Pledged Treasury Securities, to
              be paid upon settlement of such Holder's obligations to purchase
              Common Stock under the Purchase Contract, to the Company on the
              Stock Purchase Date in accordance with the procedure set forth in
              Section 4.5(a) or 4.5(b) hereof, in full satisfaction of the
              respective obligations of the Holders under the related Purchase
              Contracts.

       SECTION 3.2 Application of Payments.

       All payments received by the Purchase Contract Agent as provided herein
shall be applied by the Purchase Contract Agent pursuant to the provisions of
the Purchase Contract Agreement. If, notwithstanding the foregoing, the Purchase
Contract Agent

                                      -8-
<PAGE>

shall receive any payments of principal on account of any Debenture or Treasury
Consideration, as applicable, that, at the time of such payment, is a Pledged
Debenture or Pledged Treasury Consideration, as the case may be, or a Holder of
a Stripped Unit shall receive any payments of principal on account of any
Treasury Securities that, at the time of such payment, are Pledged Treasury
Securities, the Purchase Contract Agent or such Holder shall hold the same as
trustee of an express trust for the benefit of the Company (and promptly deliver
the same over to the Company) for application to the obligations of the Holders
under the related Purchase Contracts, and the Holders shall acquire no right,
title or interest in any such payments of principal so received.

                                   ARTICLE IV

          SUBSTITUTION, RELEASE, REPLEDGE AND SETTLEMENT OF DEBENTURES

       SECTION 4.1 Collateral Substitution and the Creation of Stripped Units.

       At any time on or prior to the fourth Business Day immediately preceding
the Stock Purchase Date, a Holder of Normal Units shall have the right to
substitute Treasury Securities for the Pledged Debentures or Pledged Treasury
Consideration, as the case may be, securing such Holder's obligations under the
Purchase Contracts comprising a part of such Normal Units, in integral multiples
of 40 Normal Units, or after a Tax Event Redemption or a successful remarketing
of the Debentures pursuant to the Purchase Contract Agreement, in integral
multiples of Normal Units such that Treasury Securities to be deposited and the
applicable Treasury Consideration to be released are in integral multiples of
$1,000, by (a) Transferring to the Collateral Agent Treasury Securities having
an aggregate principal amount equal to the aggregate Stated Amount of such
Normal Units and (b) delivering such Normal Units to the Purchase Contract
Agent, accompanied by a notice, substantially in the form of Exhibit B hereto,
to the Purchase Contract Agent stating that such Holder has Transferred Treasury
Securities to the Collateral Agent pursuant to clause (a) above (stating the
principal amount, the maturities and the CUSIP numbers of the Treasury
Securities Transferred by such Holder) and requesting that the Purchase Contract
Agent instruct the Collateral Agent to release from the Pledge the Pledged
Debentures or Pledged Treasury Consideration, as the case may be, related to
such Normal Units, whereupon the Purchase Contract Agent shall promptly give
such instruction to the Collateral Agent in the form provided in Exhibit A.
Notwithstanding the foregoing a Holder may not separate the Pledged Debentures
or Pledged Treasury Consideration as the case may be, from the related Purchase
Contract in respect of Normal Units held by such Holder during the periods
beginning on the fourth Business Day prior to the Remarketing Date or any
Subsequent Remarketing Date, as the case may be, and ending on the third
Business Day following such dates. Upon receipt of Treasury Securities from a
Holder of Normal Units and the related instruction from the Purchase Contract
Agent, the Collateral Agent shall release the Pledged Debentures or Pledged
Treasury Consideration, as the case may be, and shall promptly Transfer such
Pledged Debentures or Pledged Treasury Consideration, as the case may

                                      -9-
<PAGE>

be, free and clear of any lien, pledge or security interest created hereby, to
the Purchase Contract Agent. All items Transferred and/or substituted by any
Holder pursuant to this Section 4.1, Section 4.2 or any other Section of this
Agreement shall be Transferred and/or substituted free and clear of all liens,
claims and encumbrances.

       SECTION 4.2 Collateral Substitution and the Re-Creation of Normal Units.

       At any time on or prior to the fourth Business Day immediately preceding
the Stock Purchase Date, a Holder of Stripped Units shall have the right to
reestablish Normal Units (a) consisting of the Purchase Contracts and Debentures
in integral multiples of 40 Normal Units, or (b) or after a Tax Event Redemption
or a successful remarketing of the Debentures pursuant to the Purchase Contract
Agreement, consisting of the Purchase Contracts and the appropriate Treasury
Consideration (identified and calculated by reference to the Treasury
Consideration then comprising Normal Units) in integral multiples of Stripped
Units such that the Treasury Consideration to be deposited and the Treasury
Securities to be released are in integral multiples of $1,000, by (x)
Transferring to the Collateral Agent Debentures or the appropriate Treasury
Consideration, as the case may be, then comprising such number of Normal Units
as is equal to such Stripped Units and (y) delivering such Stripped Units to the
Purchase Contract Agent, accompanied by a notice, substantially in the form of
Exhibit B hereto, to the Purchase Contract Agent stating that such Holder has
transferred Debentures or Treasury Consideration to the Collateral Agent
pursuant to clause (a) above and requesting that the Purchase Contract Agent
instruct the Collateral Agent to release from the Pledge the Pledged Treasury
Securities related to such Stripped Units, whereupon the Purchase Contract Agent
shall give such instruction to the Collateral Agent in the form provided in
Exhibit A. Notwithstanding the foregoing, a Holder may not reestablish Normal
Units during the periods beginning on the fourth Business Day prior to the
Remarketing Date or any Subsequent Remarketing Date, as the case may be, and
ending on the third Business Day following such dates. Upon receipt of the
Debentures or the appropriate Treasury Consideration, as the case may be, from
such Holder and the instruction from the Purchase Contract Agent, the Collateral
Agent shall release the Pledged Treasury Securities and shall promptly Transfer
such Treasury Securities, free and clear of any lien, pledge or security
interest created hereby, to the Purchase Contract Agent.

       SECTION 4.3 Termination Event.

       (a) Upon receipt by the Collateral Agent of written notice from the
Company or the Purchase Contract Agent that there has occurred a Termination
Event, the Collateral Agent shall release all Collateral from the Pledge and
shall promptly Transfer any Pledged Debentures or Pledged Treasury
Consideration, as the case may be, and Pledged Treasury Securities to the
Purchase Contract Agent for the benefit of the Holders of the Normal Units and
the Stripped Units, respectively, free and clear of any lien, pledge or security
interest or other interest created in favor of the Collateral Agent hereby.

                                      -10-
<PAGE>

       (b) If such Termination Event shall result from the Company's becoming a
debtor under the Bankruptcy Code, and if the Collateral Agent shall for any
reason be unable to promptly effectuate the release and Transfer of all Pledged
Debentures, Pledged Treasury Consideration or of the Pledged Treasury
Securities, as the case may be, as provided by this Section 4.3, the Purchase
Contract Agent shall

       (i)    use its best efforts to obtain an opinion of a nationally
              recognized law firm reasonably acceptable to the Collateral Agent
              to the effect that, as a result of the Company's being the debtor
              in such a bankruptcy case, the Collateral Agent will not be
              prohibited from releasing or Transferring the Collateral as
              provided in this Section 4.3, and shall deliver such opinion to
              the Collateral Agent within ten days after the occurrence of such
              Termination Event, and if (y) the Purchase Contract Agent shall be
              unable to obtain such opinion within ten days after the occurrence
              of such Termination Event or (z) the Collateral Agent shall
              continue, after delivery of such opinion, to refuse to effectuate
              the release and Transfer of all Pledged Debentures, Pledged
              Treasury Consideration or Pledged Treasury Securities, as the case
              may be, as provided in this Section 4.3, then the Purchase
              Contract Agent shall within fifteen days after the occurrence of
              such Termination Event commence an action or proceeding in the
              court with jurisdiction of the Company's case under the Bankruptcy
              Code seeking an order requiring the Collateral Agent to effectuate
              the release and transfer of all Pledged Debentures, Pledged
              Treasury Consideration or Pledged Treasury Securities, as the case
              may be, as provided by this Section 4.3 or

       (ii)   commence an action or proceeding like that described in subsection
              (i)(z) hereof within ten days after the occurrence of such
              Termination Event.

       SECTION 4.4 Early Settlement; Merger Early Settlement.

       Upon written notice to the Collateral Agent by the Purchase Contract
Agent that one or more Holders of Units have elected to effect Early Settlement
or Merger Early Settlement of their respective obligations under the Purchase
Contracts forming a part of such Units in accordance with the terms of the
Purchase Contracts and the Purchase Contract Agreement (setting forth the number
of such Purchase Contracts as to which such Holders have elected to effect Early
Settlement or Merger Early Settlement), and that the Purchase Contract Agent has
received from such Holders, and paid to the Company as confirmed in writing by
the Company, the related Early Settlement Amounts or Merger Early Settlement
Amounts, as the case may be, pursuant to the terms of the Purchase Contracts and
the Purchase Contract Agreement and that all conditions to such Early Settlement
or Merger Early Settlement, as the case may be, have been satisfied, then the
Collateral Agent shall release from the Pledge (a) Pledged Debentures or Pledged
Treasury Consideration, as the case may be, in the case of a Holder of Normal
Units or (b) Pledged Treasury Securities, in the case of a Holder of Stripped
Units,

                                      -11-
<PAGE>

relating to such Purchase Contracts as to which such Holders have elected to
effect Early Settlement or Merger Early Settlement, and shall Transfer all such
Pledged Debentures, Pledged Treasury Consideration or Pledged Treasury
Securities, as the case may be, free and clear of the Pledge to the Collateral
Agent created hereby, to the Purchase Contract Agent for the benefit of the
Holders.

       SECTION 4.5 Remarketing; Application of Proceeds; Settlement.

       (a) Pursuant to the Purchase Contract Agreement, the Purchase Contract
Agent shall notify, by 10:00 a.m., New York City time, on the third Business Day
preceding the Remarketing Date or any Subsequent Remarketing Date, as the case
may be, the Remarketing Agent and the Collateral Agent of the aggregate
principal amount of Debentures comprising part of Normal Units to be remarketed.
The Collateral Agent shall, by 10:00 a.m., New York City time, on the Business
Day immediately preceding the Remarketing Date or any Subsequent Remarketing
Date, as the case may be, without any instruction from Holders of Normal Units,
deliver (i) the Pledged Debentures to be remarketed to the Remarketing Agent for
remarketing and (ii) the remaining Pledged Debentures to the Purchase Contract
Agent for distribution to the Holders that have elected not to participate in
the remarketing in accordance with the Purchase Contract Agreement. The
Remarketing Agent will deliver the Agent-purchased Treasury Consideration
purchased from the proceeds of the remarketing to the Purchase Contract Agent,
which shall thereupon deliver such Agent-purchased Treasury Consideration to the
Collateral Agent. Upon receipt of the Agent-purchased Treasury Consideration
from the Purchase Contract Agent following a successful remarketing, the
Collateral Agent, for the benefit of the Company, shall thereupon apply such
Treasury Consideration to secure such Holders' obligations under the Purchase
Contracts. On the Stock Purchase Date, the Collateral Agent shall apply that
portion of the payments received in respect of the Pledged Treasury
Consideration equal to the aggregate Stated Amount of the related Normal Units
to satisfy in full the obligations of such Holders of Normal Units to pay the
Purchase Price under the related Purchase Contracts. The remaining portion of
such Proceeds, if any, shall be distributed by the Collateral Agent to the
Purchase Contract Agent for payment to such Holders.

       (b) Within three Business Days following a Failed Remarketing, the
Debentures delivered to the Remarketing Agent and the Purchase Contract Agent
pursuant to Section 4.5(a) shall be returned to the Collateral Agent, together
with written notice from the Remarketing Agent of the Failed Remarketing. The
Collateral Agent, for the benefit of the Company, shall thereupon apply such
Debentures to secure the Normal Units Holders' obligations under the Purchase
Contracts. The Remarketing Agent may make one or more attempts to remarket the
Debentures in accordance with the procedures set forth in the Purchase Contract
Agreement and the Remarketing Agreement between the Remarketing Date and the
Stock Purchase Date, provided that the requirements of Section 5.2(b)(ii) of the
Purchase Contract Agreement have been met. If by 4:00 p.m., New York City time,
on the third Business Day immediately preceding the Stock Purchase Date the
Remarketing Agent has failed to remarket the Debentures at 100.5% of

                                      -12-
<PAGE>

the Remarketing Value, the Last Failed Remarketing shall be deemed to have
occurred. In this case, the Remarketing Agent shall advise the Collateral Agent
in writing that it cannot remarket the related Pledged Debentures of such
Holders of Normal Units. The Collateral Agent, for the benefit of the Company
will, at the written direction of the Company, deliver or dispose of the Pledged
Debentures in accordance with the Company's written instructions to satisfy in
full, from any such disposition or retention, such Holders' obligations to pay
the Purchase Price for the Common Stock; provided, that if upon the Last Failed
Remarketing, the Collateral Agent delivers or disposes of the Pledged Debentures
in accordance with the written instructions of the Company, any accrued and
unpaid interest on such Debentures through the Stock Purchase Date will become
payable by the Company to the Purchase Contract Agent for payment to the Holder
of the Normal Units to which such Debentures relate in accordance with the
Purchase Contract Agreement.

       (c) In the event a Holder of Stripped Units has not made an Early
Settlement or Merger Early Settlement of the Purchase Contracts underlying its
Stripped Units, such Holder shall be deemed to have elected to pay for the
shares of Common Stock to be issued under such Purchase Contracts on the Stock
Purchase Date from the payments received in respect of the related Pledged
Treasury Securities. Without receiving any instruction from any such Holder of
Stripped Units, the Collateral Agent shall apply such payments to the settlement
of such Purchase Contracts on the Stock Purchase Date pursuant to written
instructions from the Purchase Contract Agent. In the event the payments
received in respect of the related Pledged Treasury Securities are in excess of
the aggregate Purchase Price of the Purchase Contracts being settled thereby,
the Collateral Agent shall distribute such excess, when received, to the
Purchase Contract Agent for the benefit of the Holders.

       (d) Pursuant to the Remarketing Agreement, on or prior to the fourth
Business Day preceding the Remarketing Date or any Subsequent Remarketing Date,
but no earlier than the Payment Date immediately preceding the Remarketing Date
or the Subsequent Remarketing Date, holders of Separate Debentures may elect to
have their Separate Debentures remarketed by delivering their Separate
Debentures, together with a notice of such election, substantially in the form
of Exhibit C hereto, to the Custodial Agent. On the third Business Day prior to
the Remarketing Date and any Subsequent Remarketing Date, by 10:00 a.m. New York
City time, the Custodial Agent shall notify the Remarketing Agent of the
principal amount of such Separate Debentures to be remarketed. The Custodial
Agent will hold such Separate Debentures in an account separate from the
Collateral Account. A holder of Separate Debentures electing to have its
Separate Debentures remarketed will also have the right to withdraw such
election by written notice to the Custodial Agent, substantially in the form of
Exhibit D hereto, prior to the fifth Business Day immediately preceding the
Remarketing Date and any Subsequent Remarketing Date, upon which notice the
Custodial Agent will return such Separate Debentures to such holder. On the
Business Day immediately preceding the Remarketing Date and any Subsequent
Remarketing Date, the Custodial Agent will deliver to the Remarketing Agent for
remarketing all Separate Debentures delivered to

                                      -13-
<PAGE>

the Custodial Agent pursuant to this Section 4.5(d) and not withdrawn pursuant
to the terms hereof prior to such date. The portion of the proceeds from such
remarketing equal to the amount calculated in respect of such Separate
Debentures as set forth in Section 5.2(b) of the Purchase Contract Agreement
will automatically be remitted by the Remarketing Agent to the Custodial Agent
for the benefit of the holders of such Separate Debentures. In addition, after
deducting as the remarketing fee an amount not exceeding 50 basis points (.50%)
of the total proceeds of such remarketing, the Remarketing Agent will remit to
the Custodial Agent the remaining portion of the proceeds, if any, for the
benefit of such holders. If, despite using its commercially reasonable best
efforts, the Remarketing Agent advises the Custodial Agent in writing that there
has been a Failed Remarketing, the Remarketing Agent will promptly return such
Debentures to the Custodial Agent for redelivery to such holders. The Custodial
Agent shall be entitled to rely without further inquiry on any written
instruction received from a holder of Separate Debentures and shall have no
liability with respect thereto. For purposes of this Section 4.5(d), a "holder"
of a Separate Debenture shall mean the Person in whose name such Separate
Debenture is registered on the books of the registrar for the Debentures.

                                    ARTICLE V

                           VOTING RIGHTS -- DEBENTURES

       SECTION 5.1 Exercise by Purchase Contract Agent.

       The Purchase Contract Agent may exercise, or refrain from exercising, any
and all voting and other consensual rights pertaining to the Pledged Debentures
or any part thereof for any purpose not inconsistent with the terms of this
Agreement and in accordance with the terms of the Purchase Contract Agreement;
provided, that the Purchase Contract Agent shall not exercise or, as the case
may be, shall not refrain from exercising such right if, in the judgment of the
Company, such action would impair or otherwise have a material adverse effect on
the value of all or any of the Pledged Debentures; and provided, further, that
the Purchase Contract Agent shall give the Company and the Collateral Agent at
least five Business Days' prior written notice of the manner in which it intends
to exercise, or its reasons for refraining from exercising, any such right. Upon
receipt of any notices and other communications in respect of any Pledged
Debentures, including notice of any meeting at which holders of Debentures are
entitled to vote or solicitation of consents, waivers or proxies of holders of
Debentures, the Collateral Agent shall use reasonable efforts to send promptly
to the Purchase Contract Agent such notice or communication, and as soon as
reasonably practicable after receipt of a written request therefor from the
Purchase Contract Agent, execute and deliver to the Purchase Contract Agent such
proxies and other instruments in respect of such Pledged Debentures (in form and
substance satisfactory to the Collateral Agent) as are prepared by the Purchase
Contract Agent with respect to the Pledged Debentures.

                                      -14-
<PAGE>

                                   ARTICLE VI

                    RIGHTS AND REMEDIES; TAX EVENT REDEMPTION

       SECTION 6.1 Rights and Remedies of the Collateral Agent.

       (a) In addition to the rights and remedies available at law or in equity,
after an event of default hereunder, the Collateral Agent shall have all of the
rights and remedies with respect to the Collateral of a secured party under the
Uniform Commercial Code (or any successor thereto) as in effect in the State of
New York from time to time (the "Code") (whether or not the Code is in effect in
the jurisdiction where the rights and remedies are asserted) and the TRADES
Regulations and such additional rights and remedies to which a secured party is
entitled under the laws in effect in any jurisdiction where any rights and
remedies hereunder may be asserted. Wherever reference is made in this Agreement
to any section of the Code, such reference shall be deemed to include a
reference to any provision of the Code which is a successor to, or amendment of,
such section. Without limiting the generality of the foregoing, such remedies
may include, to the extent permitted by applicable law, (i) retention of the
Pledged Debentures or other Collateral in full satisfaction of the Holders'
obligations under the Purchase Contracts or (ii) sale of the Pledged Debentures
or other Collateral in one or more public or private sales at the written
direction of the Company.

       (b) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, in the event the Collateral Agent is unable
to make payments to the Company on account of any Pledged Treasury Consideration
or Pledged Treasury Securities as provided in Article III hereof in satisfaction
of the obligations of the Holder of the Units of which such Pledged Treasury
Consideration or Pledged Treasury Securities, as applicable, is a part under the
related Purchase Contracts, the inability to make such payments shall constitute
an event of default hereunder and the Collateral Agent shall have and may
exercise, with reference to such Pledged Treasury Securities or such Pledged
Treasury Consideration, as applicable, and such obligations of such Holder, any
and all of the rights and remedies available to a secured party under the Code
and the TRADES Regulations after default by a debtor, and as otherwise granted
herein or under any other law.

       (c) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, the Collateral Agent is hereby irrevocably
authorized to receive and collect all payments of (i) the principal amount of,
or interest on, the Pledged Debentures, or (ii) the principal amount of the
Pledged Treasury Consideration or Pledged Treasury Securities, subject, in each
case, to the provisions of Article III, and as otherwise granted herein.

       (d) The Purchase Contract Agent, individually and as attorney-in-fact for
each Holder of Units, agrees that, from time to time, upon the written request
of the Company or the Collateral Agent (acting upon the written request of the
Company), the Purchase

                                      -15-
<PAGE>

Contract Agent or such Holder shall execute and deliver such further documents
and do such other acts and things as may be necessary, including as the Company
or the Collateral Agent (acting upon the written request of the Company) may
reasonably request in order to maintain the Pledge, and the perfection and
priority thereof, and to confirm the rights of the Collateral Agent hereunder.
The Purchase Contract Agent shall have no liability to any Holder for executing
any documents or taking any such acts requested by the Company or the Collateral
Agent (acting upon the written request of the Company) hereunder, except for
liability for its own negligent act, its own negligent failure to act, its bad
faith or its own willful misconduct.

       SECTION 6.2 Substitutions.

       Whenever a Holder has the right to substitute Treasury Securities,
Debentures or Treasury Consideration, as the case may be, for Collateral held by
the Collateral Agent, such substitution shall not constitute a novation of the
security interest created hereby.

       SECTION 6.3 Tax Event Redemption.

       Upon the occurrence of a Tax Event Redemption prior to a successful
remarketing of the Debentures pursuant to the Remarketing Agreement, the
aggregate Redemption Price payable on the Tax Event Redemption Date with respect
to the Pledged Debentures shall be delivered to the Collateral Agent by the
Trustee, solely to the extent funds therefor have been received by it from the
Company, on or prior to 12:00 p.m., New York City time, by check or wire
transfer in immediately available funds at such place and at such account as may
be designated by the Collateral Agent in exchange for Pledged Debentures. In the
event the Collateral Agent receives such Redemption Price, the Collateral Agent
will, at the written direction of the Company, apply an amount, out of such
Redemption Price, equal to the aggregate Redemption Amount with respect to the
Pledged Debentures to purchase from the Quotation Agent the Redemption Treasury
Portfolio and promptly remit the remaining portion of such Redemption Price to
the Purchase Contract Agent for payment to the Holders of Normal Units. The
Collateral Agent shall transfer the Redemption Treasury Portfolio to the
Collateral Account in the manner specified herein for Pledged Debentures to
secure the obligation of all Holders of Normal Units to purchase Common Stock of
the Company under the Purchase Contracts constituting a part of such Normal
Units, in substitution for the Pledged Debentures. Thereafter, the Collateral
Agent shall have such security interests, rights and obligations with respect to
the Redemption Treasury Portfolio as it had in respect of the Pledged Debentures
as provided in Articles II, III, IV, V and VI and any reference herein to the
Pledged Debentures shall be deemed to be a reference to such Redemption Treasury
Portfolio, and any reference herein to interest on the Pledged Debentures shall
be deemed to be a reference to distributions on such Redemption Treasury
Portfolio.

                                      -16-
<PAGE>

                                   ARTICLE VII

                    REPRESENTATIONS AND WARRANTIES; COVENANTS

       SECTION 7.1 Representations and Warranties of the Holders.

       The Holders from time to time, acting through the Purchase Contract Agent
as their attorney-in-fact (it being understood that the Purchase Contract Agent
shall not be liable for any representation or warranty made by or on behalf of a
Holder), hereby represent and warrant to the Collateral Agent, which
representations and warranties shall be deemed repeated on each day a Holder
Transfers Collateral that:

       (a) such Holder has the power to grant a security interest in and lien on
the Collateral;

       (b) such Holder is the sole beneficial owner of the Collateral and, in
the case of Collateral delivered in physical form, is the sole holder of such
Collateral and is the sole beneficial owner of, or has the right to Transfer,
the Collateral it Transfers to the Collateral Agent, free and clear of any
security interest, lien, encumbrance, call, liability to pay money or other
restriction other than the security interest and lien granted under Section 2.1;

       (c) upon the Transfer of the Collateral to the Collateral Account, the
Collateral Agent, for the benefit of the Company, will have a valid and
perfected first priority security interest therein (assuming that any central
clearing operation or any Intermediary or other entity not within the control of
the Holder involved in the Transfer of the Collateral, including the Collateral
Agent, gives the notices and takes the action required of it hereunder and under
applicable law for perfection of that interest and assuming the establishment
and exercise of control pursuant to Section 2.2); and

       (d) the execution and performance by the Holder of its obligations under
this Agreement will not result in the creation of any security interest, lien or
other encumbrance on the Collateral other than the security interest and lien
granted under Section 2.1 or violate any provision of any existing law or
regulation applicable to it or of any mortgage, charge, pledge, indenture,
contract or undertaking to which it is a party or which is binding on it or any
of its assets.

       SECTION 7.2 Representations and Warranties of the Collateral Agent,
Custodial Agent and Securities Intermediary.

       The Collateral Agent, Custodial Agent and Securities Intermediary (each
an "Agent") hereby represents and warrants:

       (a) U S. Bank, N.A. is a national banking association duly organized and
validly existing under the laws of the United States;

                                      -17-
<PAGE>

       (b) The execution, delivery and performance by the Collateral Agent, the
Custodial Agent and the Securities Intermediary of this Agreement have each been
duly authorized by all necessary corporate action on the part of each such
Agent; this Agreement has been duly executed and delivered by the Collateral
Agent, the Custodial Agent and the Securities Intermediary and constitutes a
valid and legally binding obligation of each of the Agents, enforceable against
such Agents in accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity principles;

       (c) The execution, delivery and performance by the Collateral Agent, the
Custodial Agent and the Securities Intermediary of this Agreement do not violate
or constitute a breach of the Articles of Incorporation or By-Laws of any of
such Agents; and

       (d) No consent of any federal or state banking authority is required for
the execution, delivery or performance by the Agents of their respective
obligations under this Agreement.

       SECTION 7.3 Covenants.

       The Holders from time to time, acting through the Purchase Contract Agent
as their attorney-in-fact (it being understood that the Purchase Contract Agent
shall not be liable for any covenant made by or on behalf of a Holder), hereby
covenant to the Collateral Agent that for so long as the Collateral remains
subject to the Pledge:

       (a) neither the Purchase Contract Agent nor such Holders will create or
purport to create or allow to subsist any mortgage, charge, lien, pledge or any
other security interest whatsoever over the Collateral or any part of it other
than pursuant to this Agreement; and

       (b) neither the Purchase Contract Agent nor such Holders will sell or
otherwise dispose (or attempt to dispose) of the Collateral or any part of it
except for the beneficial interest therein, subject to the pledge hereunder,
transferred in connection with the Transfer of the Units.

                                  ARTICLE VIII

                              THE COLLATERAL AGENT

       SECTION 8.1 Appointment, Powers and Immunities.

       (a) The Collateral Agent shall act as agent for the Company hereunder
with such powers as are specifically vested in the Collateral Agent by the terms
of this

                                      -18-
<PAGE>

Agreement, together with such other powers as are reasonably incidental thereto.
Each of the Collateral Agent, the Custodial Agent and the Securities
Intermediary:

       (i)    shall have no duties or responsibilities except those expressly
              set forth in this Agreement and no implied covenants or
              obligations shall be inferred from this Agreement against any of
              them, nor shall any of them be bound by the provisions of any
              agreement by any party hereto beyond the specific terms hereof;

       (ii)   shall not be responsible for any recitals contained in this
              Agreement, or in any certificate or other document referred to or
              provided for in, or received by it under, this Agreement, the
              Units or the Purchase Contract Agreement, or for the value,
              validity, effectiveness, genuineness, enforceability or
              sufficiency of this Agreement (other than as against the
              Collateral Agent), the Units or the Purchase Contract Agreement or
              any other document referred to or provided for herein or therein
              or for any failure by the Company or any other Person (except the
              Collateral Agent, the Custodial Agent or the Securities
              Intermediary, as the case may be) to perform any of its
              obligations hereunder or thereunder or for the perfection,
              priority or, except as expressly required hereby, existence,
              validity, perfection or maintenance of any security interest
              created hereunder;

       (iii)  shall not be required to initiate or conduct any litigation or
              collection proceedings hereunder (except in the case of the
              Collateral Agent, pursuant to directions furnished under Section
              8.2, subject to Section 8.6);

       (iv)   shall not be responsible for any action taken or omitted to be
              taken by it hereunder or under any other document or instrument
              referred to or provided for herein or in connection herewith or
              therewith, except for its own gross negligence, bad faith or
              willful misconduct; and

       (v)    shall not be required to advise any party as to selling or
              retaining, or taking or refraining from taking any action with
              respect to, the Units or other property deposited hereunder.

Subject to the foregoing, during the term of this Agreement, the Collateral
Agent shall take all reasonable action in connection with the safekeeping and
preservation of the Collateral hereunder.

       (b) No provision of this Agreement shall require the Collateral Agent,
the Custodial Agent or the Securities Intermediary to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties hereunder. In no event shall the Collateral Agent, the Custodial
Agent or the Securities Intermediary be liable for any amount in excess of the
value of the Collateral or for any special, indirect, individual, consequential
damages or lost profits or loss of business, arising in connection with this
Agreement. Notwithstanding the foregoing, the Collateral Agent,

                                      -19-
<PAGE>

the Custodial Agent, the Purchase Contract Agent and Securities Intermediary,
each in its individual capacity, hereby waive any right of setoff, bankers lien,
liens or perfection rights as securities intermediary or any counterclaim with
respect to any of the Collateral.

       (c) The Collateral Agent, Custodial Agent and Securities Intermediary
shall have no liability whatsoever for the action or inaction of any Clearing
Agency or any book-entry system thereof. In no event shall any Clearing Agency
or any book-entry system thereof be deemed an agent or subcustodian of the
Collateral Agent, Custodial Agent and Securities Intermediary. The Collateral
Agent, Custodial Agent and Securities Intermediary shall not be responsible or
liable for any failure or delay in the performance of its obligations under this
Agreement arising out of or caused, directly or indirectly, by circumstances
beyond its reasonable control, including, without limitation, acts of God;
earthquakes; fires; floods; wars; civil or military disturbances; sabotage;
epidemics; riots; interruptions, loss or malfunctions of utilities, computer
(hardware or software) or communications service; accidents; labor disputes;
acts of civil or military authority; governmental actions; or inability to
obtain labor, material, equipment or transportation.

       SECTION 8.2 Instructions of the Company.

       The Collateral Agent shall not be under any duty or obligation to take
action to effect collection of any amount due on the Pledged Debentures, Pledged
Treasury Consideration or Pledged Treasury Securities in the Collateral Account
whether or not the Collateral upon which such amount is payable is in default,
or if payment is refused after due demand or presentation, unless and until (i)
it shall be directed to take such action by written instructions and (ii) it
shall be assured to its satisfaction of reimbursement of its reasonable costs
and expenses in connection with any such action.

       The Company shall have the right, by one or more instruments in writing
executed and delivered to the Collateral Agent, the Custodial Agent or the
Securities Intermediary, as the case may be, to direct the time, method and
place of conducting any proceeding for the realization of any right or remedy
available to the Collateral Agent, or of exercising any power conferred on the
Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be, or to direct the taking or refraining from taking of any action
authorized by this Agreement; provided, however, that (i) such direction shall
not conflict with the provisions of any law or of this Agreement and (ii) the
Collateral Agent, the Custodial Agent and the Securities Intermediary shall each
receive indemnity reasonably satisfactory to it as provided herein. Nothing in
this Section 8.2 shall impair the right of the Collateral Agent in its
discretion to take any action or omit to take any action which it deems proper
and which is not inconsistent with such direction.

       SECTION 8.3 Reliance.

       Each of the Securities Intermediary, the Custodial Agent and the
Collateral Agent shall be entitled conclusively to rely upon any certification,
order, judgment, opinion, notice or other communication (including, without
limitation, any thereof by telephone or

                                      -20-
<PAGE>

facsimile) reasonably believed by it to be genuine and correct and to have been
signed or sent by or on behalf of the proper Person or Persons (without being
required to determine the correctness of any fact stated therein), and upon
advice and statements of legal counsel and other experts selected by the
Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be. It is understood that the Collateral Agent, the Custodial Agent or
the Securities Intermediary and the beneficiary's bank in any funds transfer may
rely solely upon any account numbers or similar identifying number provided by
the other party hereto to identify (i) the beneficiary, (ii) the beneficiary
bank, or (iii) an intermediary bank. The Collateral Agent, the Custodial Agent
or the Securities Intermediary may apply any of the funds for any payment order
it executes using any such identifying number, even where its use may result in
a person other than the beneficiary being paid, or the transfer of funds to a
bank other than the beneficiary's bank, or an intermediary bank designated. As
to any matters not expressly provided for by this Agreement, the Collateral
Agent, the Custodial Agent and the Securities Intermediary shall in all cases be
fully protected in acting, or in refraining from acting, hereunder in accordance
with instructions given by the Company in accordance with this Agreement.

       SECTION 8.4 Rights in Other Capacities.

       The Collateral Agent, the Custodial Agent and the Securities Intermediary
and their affiliates may (without having to account therefor to the Company)
accept deposits from, lend money to, make their investments in and generally
engage in any kind of banking, trust or other business with the Purchase
Contract Agent, any Holder of Units and any holder of Separate Debentures (and
any of their respective subsidiaries or affiliates) as if it were not acting as
the Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be, and the Collateral Agent, the Custodial Agent and the Securities
Intermediary and their affiliates may accept fees and other consideration from
the Purchase Contract Agent, any Holder of Units or any holder of Separate
Debentures without having to account for the same to the Company; provided that
each of the Securities Intermediary, the Custodial Agent and the Collateral
Agent covenants and agrees with the Company that it shall not accept, receive or
permit there to be created in favor of itself (and waives any right of set-off
or banker's lien with respect to) and shall take no affirmative action to permit
there to be created in favor of any other Person, any security interest, lien or
other encumbrance of any kind in or upon the Collateral and the Collateral shall
not be commingled with any other assets of any such Person.

       SECTION 8.5 Non-Reliance on Collateral Agent.

       None of the Securities Intermediary, the Custodial Agent or the
Collateral Agent shall be required to keep itself informed as to the performance
or observance by the Purchase Contract Agent or any Holder of Units of this
Agreement, the Purchase Contract Agreement, the Units or any other document
referred to or provided for herein or therein or to inspect the properties or
books of the Purchase Contract Agent or any

                                      -21-
<PAGE>

Holder of Units. The Collateral Agent, the Custodial Agent and the Securities
Intermediary shall not have any duty or responsibility to provide the Company or
the Remarketing Agent with any credit or other information concerning the
affairs, financial condition or business of the Purchase Contract Agent, any
Holder of Units or any holder of Separate Debentures (or any of their respective
subsidiaries or affiliates) that may come into the possession of the Collateral
Agent, the Custodial Agent or the Securities Intermediary or any of their
respective affiliates.

       SECTION 8.6 Compensation and Indemnity.

       The Company agrees:

       (a) to pay each of the Collateral Agent, the Custodial Agent and the
Securities Intermediary from time to time such compensation as shall be agreed
in writing between the Company and the Collateral Agent, Custodial Agent or the
Securities Intermediary, as the case may be, for all services rendered by each
of them hereunder; and

       (b) to indemnify the Collateral Agent, the Custodial Agent and the
Securities Intermediary (which for purposes of this paragraph, in each case,
shall include its directors, officers, employees and agents) for, and to hold
each of them harmless from and against, any loss, liability or reasonable
out-of-pocket expense incurred without gross negligence, willful misconduct or
bad faith on its part, arising out of or in connection with the acceptance or
administration of its powers and duties under this Agreement, including the
reasonable out-of-pocket costs and expenses (including reasonable fees and
expenses of counsel) of defending itself against any claim or liability in
connection with the exercise or performance of such powers and duties or
collecting such amounts. The Collateral Agent, the Custodial Agent and the
Securities Intermediary shall each promptly notify the Company of any third
party claim which may give rise to the indemnity hereunder and give the Company
the opportunity to participate in the defense of such claim with counsel
reasonably satisfactory to the indemnified party (provided, however, that if
there shall exist a conflict of interest between the Company on the one hand,
and the Collateral Agent, the Custodial Agent or the Securities Intermediary on
the other hand, in the conduct of any such defense which makes it impracticable
for a single counsel to represent the Company and the Collateral Agent, the
Custodial Agent or the Securities Intermediary, then the Collateral Agent, the
Custodial Agent or the Securities Intermediary, as the case may be, shall have
the right to select separate counsel to participate in the defense of such
claim), and no such claim shall be settled without the written consent of the
Company, which consent shall not be unreasonably withheld.

       SECTION 8.7 Failure to Act.

       In the event of any ambiguity in the provisions of this Agreement or any
dispute between or conflicting claims by or among the parties hereto or any
other Person with respect to any funds or property deposited hereunder, the
Collateral Agent, Custodial Agent and the Securities Intermediary shall be
entitled, after prompt notice to the Company and the Purchase Contract Agent, at
its sole option, to refuse to comply with

                                      -22-
<PAGE>

any and all claims, demands or instructions with respect to such property or
funds so long as such dispute or conflict shall continue, and neither the
Collateral Agent, Custodial Agent nor the Securities Intermediary shall be or
become liable in any way to any of the parties hereto for its failure or refusal
to comply with such conflicting claims, demands or instructions. The Collateral
Agent, Custodial Agent and the Securities Intermediary shall be entitled to
refuse to act until either (i) such conflicting or adverse claims or demands
shall have been finally determined by a court of competent jurisdiction or
settled by agreement between the conflicting parties as evidenced in a writing,
reasonably satisfactory to the Collateral Agent, Custodial Agent or the
Securities Intermediary, as the case may be, or (ii) the Collateral Agent, the
Custodial Agent or the Securities Intermediary, as the case may be, shall have
received security or an indemnity reasonably satisfactory to the Collateral
Agent, Custodial Agent or the Securities Intermediary, as the case may be,
sufficient to save the Collateral Agent, Custodial Agent or the Securities
Intermediary, as the case may be, harmless from and against any and all loss,
liability or reasonable out-of-pocket expense which the Collateral Agent,
Custodial Agent or the Securities Intermediary, as the case may be, may incur by
reason of its acting without bad faith, willful misconduct or gross negligence.
The Collateral Agent, Custodial Agent or the Securities Intermediary may in
addition elect to commence an interpleader action or seek other judicial relief
or orders as the Collateral Agent, Custodial Agent or the Securities
Intermediary, as the case may be, may deem necessary. Notwithstanding anything
contained herein to the contrary, neither the Collateral Agent, Custodial Agent
nor the Securities Intermediary shall be required to take any action that is in
its opinion contrary to law or to the terms of this Agreement, or which would in
its opinion subject it or any of its officers, employees or directors to
liability.

       SECTION 8.8 Resignation.

       Subject to the appointment and acceptance of a successor Collateral
Agent, Custodial Agent or Securities Intermediary, as provided below, (a) the
Collateral Agent, Custodial Agent and the Securities Intermediary may resign at
any time by giving notice thereof to the Company and the Purchase Contract Agent
as attorney-in-fact for the Holders of Units, (b) the Collateral Agent,
Custodial Agent and the Securities Intermediary may be removed at any time by
the Company and (c) if the Collateral Agent, Custodial Agent or the Securities
Intermediary fails to perform any of its material obligations hereunder in any
material respect for a period of not less than 40 days after receiving written
notice of such failure by the Purchase Contract Agent and such failure shall be
continuing, the Collateral Agent, Custodial Agent or the Securities Intermediary
may be removed by the Purchase Contract Agent. The Purchase Contract Agent shall
promptly notify the Company of any removal of the Collateral Agent, the
Custodial Agent or the Securities Intermediary pursuant to clause (c) of the
immediately preceding sentence. Upon any such resignation or removal, the
Company shall have the right to appoint a successor Collateral Agent, Custodial
Agent or Securities Intermediary, as the case may be. If no successor Collateral
Agent, Custodial Agent or Securities Intermediary, as the case may be, shall
have been so appointed and shall have accepted such appointment within 30 days
after the retiring Collateral Agent's, Custodial Agent's

                                      -23-
<PAGE>

or Securities Intermediary's giving of notice of resignation or such removal,
then the retiring Collateral Agent, Custodial Agent or Securities Intermediary,
as the case may be, may at the Company's expense petition any court of competent
jurisdiction for the appointment of a successor Collateral Agent, Custodial
Agent or Securities Intermediary, as the case may be. Upon removal of the
Collateral Agent, Custodial Agent or Securities Intermediary, no fees paid to
the retiring Collateral Agent, Custodial Agent or Securities Intermediary
pursuant to Section 8.6(a) of this Agreement shall be refunded. Each of the
Collateral Agent, Custodial Agent and the Securities Intermediary shall be a
bank which has an office in New York, New York with a combined capital and
surplus of at least $50,000,000. Upon the acceptance of any appointment as
Collateral Agent, Custodial Agent or Securities Intermediary, as the case may
be, hereunder by a successor Collateral Agent, Custodial Agent or Securities
Intermediary, as the case may be, such successor shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the retiring
Collateral Agent, Custodial Agent or Securities Intermediary, as the case may
be, and the retiring Collateral Agent, Custodial Agent or Securities
Intermediary, as the case may be, shall take all appropriate action to transfer
any money and property held by it hereunder (including the Collateral) to such
successor. The retiring Collateral Agent, Custodial Agent or Securities
Intermediary shall, upon such succession, be discharged from its duties and
obligations as Collateral Agent, Custodial Agent or Securities Intermediary
hereunder. After any retiring Collateral Agent's, Custodial Agent's or
Securities Intermediary's resignation hereunder as Collateral Agent, Custodial
Agent or Securities Intermediary, the provisions of this Section 8.8 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as the Collateral Agent, Custodial Agent or
Securities Intermediary. Any resignation or removal of the Collateral Agent
hereunder shall be deemed for all purposes of this Agreement as the simultaneous
resignation or removal of the Custodial Agent and the Securities Intermediary
hereunder.

       Any corporation into which the Collateral Agent, the Custodial Agent or
the Securities Intermediary, in its individual capacity, 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 Collateral Agent in
its individual capacity shall be a party, or any corporation to which
substantially all the corporate trust business of the Collateral Agent in its
individual capacity may be transferred, shall be the Collateral Agent, the
Custodial Agent, or the Securities Intermediary, as the case may be,
respectively, under this Agreement without further act.

       SECTION 8.9 Right to Appoint Agent or Advisor.

       The Collateral Agent shall have the right to appoint agents or advisors
in connection with any of its duties hereunder, and the Collateral Agent shall
not be liable for any action taken or omitted by, or in reliance upon the advice
of, such agents or advisors selected in good faith. The appointment of agents
(other than legal counsel) pursuant to this Section 8.9 shall be subject to
prior consent of the Company, which consent shall not be unreasonably withheld.

                                      -24-
<PAGE>

       SECTION 8.10 Survival.

       The provisions of this Article VIII shall survive termination of this
Agreement and the resignation or removal of the Collateral Agent, the Custodial
Agent or the Securities Intermediary.

       SECTION 8.11 Exculpation.

       Anything in this Agreement to the contrary notwithstanding, in no event
shall any of the Collateral Agent, the Custodial Agent or the Securities
Intermediary or their officers, employees or agents be liable under this
Agreement to any third party for indirect, special, punitive or consequential
loss or damage of any kind whatsoever, including lost profits, whether or not
the likelihood of such loss or damage was known to the Collateral Agent, the
Custodial Agent or the Securities Intermediary, or any of them, incurred without
any act or deed that is found to be attributable to negligence, bad faith or
willful misconduct on the part of the Collateral Agent, the Custodial Agent or
the Securities Intermediary.

                                   ARTICLE IX

                                    AMENDMENT

       SECTION 9.1 Amendment Without Consent of Holders.

       Without the consent of any Holders or the holders of any Separate
Debentures, the Company, the Collateral Agent, the Custodial Agent, the
Securities Intermediary and the Purchase Contract Agent, at any time and from
time to time, may amend this Agreement, in form satisfactory to the Company, the
Collateral Agent, the Custodial Agent, the Securities Intermediary and the
Purchase Contract Agent, for any of the following purposes:

       (i)    to evidence the succession of another Person to the Company, and
              the assumption by any such successor of the covenants of the
              Company; or

       (ii)   to add to the covenants of the Company for the benefit of the
              Holders, or to surrender any right or power herein conferred upon
              the Company so long as such covenants or such surrender do not
              adversely affect the validity, perfection or priority of the
              security interests granted or created hereunder; or

       (iii)  to evidence and provide for the acceptance of appointment
              hereunder by a successor Collateral Agent, Securities Intermediary
              or Purchase Contract Agent; or

                                      -25-
<PAGE>

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

       SECTION 9.2 Amendment with Consent of Holders.

       With the consent of the Holders of not less than a majority of the
Purchase Contracts at the time outstanding, by Act of said Holders delivered to
the Company, the Purchase Contract Agent or the Collateral Agent, as the case
may be, the Company, when duly authorized, the Purchase Contract Agent, the
Collateral Agent, the Custodial Agent and the Securities Intermediary may amend
this Agreement for the purpose of modifying in any manner the provisions of this
Agreement or the rights of the Holders in respect of the Units; provided,
however, that no such supplemental agreement shall, without the consent of the
Holder of each Outstanding Unit adversely affected thereby,

       (i)    change the amount or type of Collateral underlying a Unit (except
              for the rights of holders of Normal Units to substitute the
              Treasury Securities for the Pledged Debentures or the Pledged
              Treasury Consideration, as the case may be, or the rights of
              Holders of Stripped Units to substitute Debentures or the
              appropriate Treasury Consideration, as applicable, for the Pledged
              Treasury Securities), impair the right of the Holder of any Unit
              to receive distributions on the underlying Collateral or otherwise
              adversely affect the Holder's rights in or to such Collateral; or

       (ii)   otherwise effect any action that would require the consent of the
              Holder of each Outstanding Unit affected thereby pursuant to the
              Purchase Contract Agreement if such action were effected by an
              agreement supplemental thereto; or

       (iii)  reduce the percentage of Purchase Contracts the consent of whose
              Holders is required for any such amendment.

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

       SECTION 9.3 Execution of Amendments.

       In executing any amendment permitted by this Section, the Collateral
Agent, the Custodial Agent, the Securities Intermediary and the Purchase
Contract Agent shall receive and (subject to Section 6.1 hereof, with respect to
the Collateral Agent, and Section 7.1 of the Purchase Contract Agreement, with
respect to the Purchase Contract Agent) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement and that all

                                      -26-
<PAGE>

conditions precedent, if any, to the execution and delivery of such amendment
have been satisfied and, in the case of an amendment pursuant to Section 9.1,
that such amendment does not adversely affect the validity, perfection or
priority of the security interests granted or created hereunder.

       SECTION 9.4 Effect of Amendments.

       Upon the execution of any amendment under this Article IX, this Agreement
shall be modified in accordance therewith, and such amendment shall form a part
of this Agreement for all purposes; and every Holder of Certificates theretofore
or thereafter authenticated, executed on behalf of the Holders and delivered
under the Purchase Contract Agreement shall be bound thereby.

       SECTION 9.5 Reference to Amendments.

       Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any amendment pursuant to this Section may, and
shall if required by the Collateral Agent or the Purchase Contract Agent, bear a
notation in form approved by the Purchase Contract Agent as to any matter
provided for in such amendment. If the Company shall so determine, new
Certificates so modified as to conform, in the opinion of the Purchase Contract
Agent and the Company, to any such amendment may be prepared and executed by the
Company and authenticated, executed on behalf of the Holders and delivered by
the Purchase Contract Agent in accordance with the Purchase Contract Agreement
in exchange for outstanding Certificates.

                                    ARTICLE X

                                  MISCELLANEOUS

       SECTION 10.1 No Waiver.

       No failure on the part of any party hereto or any of its agents to
exercise, and no course of dealing with respect to, and no delay in exercising,
any right, power or remedy hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise by any party hereto or any of its agents of
any right, power or remedy hereunder preclude any other or further exercise
thereof or the exercise of any other right, power or remedy. The remedies herein
are cumulative and are not exclusive of any remedies provided by law.

       SECTION 10.2 GOVERNING LAW.

       THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK. Without limiting the foregoing, the above choice
of law is expressly agreed to by the Securities Intermediary, the Collateral
Agent, the Custodial Agent and the Holders from time to time acting through the
Purchase Contract Agent, as their attorney-in-fact, in connection

                                      -27-
<PAGE>

with the establishment and maintenance of the Collateral Account, which law, for
purposes of the Code, shall be deemed to be the law governing all Security
Entitlements related thereto. In addition, such parties agree that, for purposes
of the Code, New York shall be the Securities Intermediary's jurisdiction. The
Company, the Collateral Agent and the Holders from time to time of the Units,
acting through the Purchase Contract Agent as their attorney-in-fact, hereby
submit to the nonexclusive jurisdiction of the United States District Court for
the Southern District of New York and of any New York state court sitting in the
Borough of Manhattan in New York City for the purposes of all legal proceedings
arising out of or relating to this Agreement or the transactions contemplated
hereby. The Company, the Collateral Agent and the Holders from time to time of
the Units, acting through the Purchase Contract Agent as their attorney-in-fact,
irrevocably waive, to the fullest extent permitted by applicable law, any
objection which they may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum.

       SECTION 10.3 Notices.

       Unless otherwise stated herein, all notices, requests, consents and other
communications provided for herein (including, without limitation, any
modifications of, or waivers or consents under, this Agreement) shall be given
or made in writing (including, without limitation, by telecopy) delivered to the
intended recipient at the "Address for Notices" specified below its name on the
signature pages hereof or, as to any party, at such other address as shall be
designated by such party in a notice to the other parties. Except as otherwise
provided in this Agreement, all such communications shall be deemed to have been
duly given when personally delivered or, in the case of a mailed notice or
notice transmitted by telecopier, upon receipt, in each case given or addressed
as aforesaid.

       SECTION 10.4 Successors and Assigns.

       This Agreement shall be binding upon and inure to the benefit of the
respective successors and assigns of the Company, the Collateral Agent, the
Custodial Agent, the Securities Intermediary and the Purchase Contract Agent,
and the Holders from time to time of the Units, by their acceptance of the same,
shall be deemed to have agreed to be bound by the provisions hereof and to have
ratified the agreements of, and the grant of the Pledge hereunder by, the
Purchase Contract Agent.

       SECTION 10.5 Counterparts.

       This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument, and any of
the parties hereto may execute this Agreement by signing any such counterpart.

                                      -28-
<PAGE>

       SECTION 10.6 Severability.

       If any provision hereof is invalid and unenforceable in any jurisdiction,
then, to the fullest extent permitted by law, (i) the other provisions hereof
shall remain in full force and effect in such jurisdiction and shall be
liberally construed in order to carry out the intentions of the parties hereto
as nearly as may be possible and (ii) the invalidity or unenforceability of any
provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction.

       SECTION 10.7 Expenses, Etc.

       The Company agrees to reimburse the Collateral Agent, the Securities
Intermediary and the Custodial Agent for:

       (a) all reasonable out-of-pocket costs and all reasonable expenses of the
Collateral Agent, the Custodial Agent and the Securities Intermediary
(including, without limitation, the reasonable fees and expenses of counsel to
the Collateral Agent, the Custodial Agent and the Securities Intermediary), in
connection with (i) the negotiation, preparation, execution and delivery or
performance of this Agreement and (ii) any modification, supplement or waiver of
any of the terms of this Agreement;

       (b) all reasonable costs and expenses of the Collateral Agent (which for
purposes of this paragraph shall include its directors, officers, employees and
agents) (including, without limitation, reasonable fees and expenses of counsel)
in connection with (i) any enforcement or proceedings resulting or incurred in
connection with causing any Holder of Units to satisfy its obligations under the
Purchase Contracts forming a part of the Units and (ii) the enforcement of this
Section 10.7; and

       (c) all transfer, stamp, documentary or other similar taxes, assessments
or charges levied by any governmental or revenue authority in respect of this
Agreement or any other document referred to herein and all costs, expenses,
taxes, assessments and other charges incurred in connection with any filing,
registration, recording or perfection of any security interest contemplated
hereby.

       SECTION 10.8 Security Interest Absolute.

       All rights of the Collateral Agent and security interests hereunder, and
all obligations of the Holders from time to time hereunder, shall be absolute
and unconditional irrespective of:

       (a) any lack of validity or enforceability of any provision of the
Purchase Contracts or the Units or any other agreement or instrument relating
thereto;

       (b) any change in the time, manner or place of payment of, or any other
term of, or any increase in the amount of, all or any of the obligations of
Holders of Units under the related Purchase Contracts, or any other amendment or
waiver of any term of,

                                      -29-
<PAGE>

or any consent to any departure from any requirement of, the Purchase Contract
Agreement or any Purchase Contract or any other agreement or instrument relating
thereto; or

       (c) any other circumstance which might otherwise constitute a defense
available to, or discharge of, a borrower, a guarantor or a pledgor.

       SECTION 10.9 Waiver of Jury Trial.

       EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE
UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND
THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

                                      -30-
<PAGE>

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

                                 SOLECTRON CORPORATION

                                 By: /s/ Kiran Patel
                                    ------------------------------------------
                                    Name:  Kiran Patel
                                    Title: Executive Vice President, Chief
                                           Financial Officer (Principal
                                           Financial and Accounting Officer)

                                 Address for Notices:

                                 SOLECTRON CORPORATION
                                 777 Gibraltar Drive

                                 Milpitas, California 95035

                                 Attention:____________
                                 Telecopy: (408)
                                 Telephone: (408) 957-8500

                                 STATE STREET BANK AND TRUST COMPANY OF
                                 CALIFORNIA, N.A., as
                                 Purchase Contract Agent and as
                                 attorney-in-fact of the Holders
                                 from time to time of the Units

                                 By: /s/ Steve Rivero
                                    ------------------------------------------
                                    Name:  Steve Rivero
                                    Title: Vice President

                                 Address for Notices:

                                 State Street Bank and Trust Company of
                                 California, N.A.
                                 633 West 5th Street, 12th Floor
                                 Los Angeles, CA 90071
                                 Attention: Corporate Trust Administration
                                 (Solectron Corporation 2001 Pledge Agreement)
                                 Telecopy:  (213) 362-7357
                                 Telephone: (213) 362-7345

                                    -31-
<PAGE>

                                 U S. BANK, N.A., as Collateral Agent,
                                 Custodial Agent and Securities Intermediary

                                 By: /s/ Frank Leslie
                                    ------------------------------------------
                                    Name: Frank Leslie
                                    Title:

                                    Address for Notices:
                                    U.S. Bank, N.A.
                                    180 East Fifth Street
                                    St. Paul, MN 55101
                                    Attn: Corporate Trust Services/Frank Leslie
                                    Telecopy: (651) 244-0711
                                    Telephone: (651) 244-8677

                                      -32-
<PAGE>

                                    EXHIBIT A

                       INSTRUCTION FROM PURCHASE CONTRACT
                            AGENT TO COLLATERAL AGENT

U.S. Bank, N.A.
180 East Fifth Street
St. Paul, MN 55101
Attn: Corporate Trust Services/Frank Leslie
Telephone: 651.244.8677
Facsimile: 651.244.0711

              Re: Equity Security Units of Solectron Corporation (the "Company")

       We hereby notify you in accordance with Section [4.1] [4.2] of the Pledge
Agreement, dated as of December 27, 2001, (the "Pledge Agreement") among the
Company, yourselves, as Collateral Agent, Custodial Agent and Securities
Intermediary and ourselves, as Purchase Contract Agent and as attorney-in-fact
for the holders of [Normal Units] [Stripped Units] from time to time, that the
holder of Units listed below (the "Holder") has elected to substitute [$_____
aggregate principal amount of Treasury Securities (CUSIP No. _____)] [$_______
aggregate principal amount of Debentures or $_____ aggregate principal amount of
Treasury Consideration (CUSIP No. _____)] in exchange for the related [Pledged
Debentures or Pledged Treasury Consideration] [Pledged Treasury Securities] held
by you in accordance with the Pledge Agreement and has delivered to us a notice
stating that the Holder has Transferred [Treasury Securities] [Debentures or the
Treasury Consideration] to you, as Collateral Agent. We hereby instruct you,
upon receipt of such [Pledged Treasury Securities] [Pledged Debentures or
Pledged Treasury Consideration], to release the [Debentures or the Treasury
Consideration] [Treasury Securities] related to such [Normal Units] [Stripped
Units] to us in accordance with the Holder's instructions. Capitalized terms
used herein but not defined shall have the meaning set forth in the Pledge
Agreement.

Date: _____________________

                                    By: ______________________
                                        Name:
                                        Title:

                                      A-1
<PAGE>

Please print name and address of Registered Holder electing to substitute
[Treasury Securities] [Debentures or Treasury Consideration] for the [Pledged
Debentures or the Pledged Treasury Consideration] [Pledged Treasury Securities]:

Name:                                          Social Security or other Taxpayer
                                               Identification Number, if any:
Address:

                                      A-2
<PAGE>

                                    EXHIBIT B

                     INSTRUCTION TO PURCHASE CONTRACT AGENT

State Street Bank and
Trust Company of California, N.A.
633 West 5th Street, 12th Floor
Los Angeles, CA 90071
Attention: Corporate Trust Administration
(Solectron Corporation 2001 Pledge Agreement)
Telecopy:  (213) 362-7357
Telephone: (213) 362-7345

              Re: Equity Security Units of Solectron Corporation (the "Company")

       The undersigned Holder hereby notifies you that it has delivered to U S.
Bank N.A., as Collateral Agent, [$_______ aggregate principal amount of Treasury
Securities (CUSIP No. _____)] [$_______ aggregate principal amount of Debentures
or $_____ principal amount of Treasury Consideration (CUSIP No. _____)] in
exchange for the related [Pledged Debentures or Pledged Treasury Consideration]
[Pledged Treasury Securities] held by the Collateral Agent, in accordance with
Section 4.1 of the Pledge Agreement, dated as of December 27, 2001 (the "Pledge
Agreement"), between you, the Company and the Collateral Agent. The undersigned
Holder hereby instructs you to instruct the Collateral Agent to release to you
on behalf of the undersigned Holder the [Pledged Debentures or the Pledged
Treasury Consideration] [Pledged Treasury Securities] related to such [Normal
Units] [Stripped Units]. Capitalized terms used herein but not defined shall
have the meaning set forth in the Pledge Agreement.

Date: ___________________          Signature:_________________________________

                                   Signature Guarantee:  _____________________

                                      B-1
<PAGE>

Please print name and address of Registered Holder:

Name:                                          Social Security or other Taxpayer
                                               Identification Number, if any:
Address:

Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the 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 Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

                                      B-2
<PAGE>

                                    EXHIBIT C

              INSTRUCTION TO CUSTODIAL AGENT REGARDING REMARKETING

U.S. Bank, N.A.
180 East Fifth Street
St. Paul, MN 55101
Attn: Corporate Trust Services/Frank Leslie

              Re: Debentures of Solectron Corporation (the "Company")

       The undersigned hereby notifies you in accordance with Section 4.5(d) of
the Pledge Agreement, dated as of December 27, 2001 (the "Pledge Agreement"),
among the Company, yourselves, as Collateral Agent, Securities Intermediary and
Custodial Agent, and State Street Bank and Trust Company of California, N.A., as
Purchase Contract Agent and as attorney-in-fact for the Holders of Normal Units
and Stripped Units from time to time, that the undersigned elects to deliver on
the fourth Business Day immediately preceding the Remarketing Date or any
Subsequent Remarketing Date $__________ aggregate principal amount of Separate
Debentures for delivery to the Remarketing Agent for remarketing pursuant to
Section 4.5(d) of the Pledge Agreement. The undersigned will, upon request of
the Remarketing Agent, execute and deliver any additional documents deemed by
the Remarketing Agent or by the Company to be necessary or desirable to complete
the sale, assignment and transfer of the Debentures tendered hereby.

       The undersigned hereby instructs you, upon receipt of the proceeds of
such remarketing from the Remarketing Agent, net of amounts payable to the
Remarketing Agent in accordance with the Pledge Agreement, to deliver such
proceeds to the undersigned in accordance with the instructions indicated herein
under "A. Payment Instructions." The undersigned hereby instructs you, in the
event of a Failed Remarketing, upon receipt of the Debentures tendered herewith
from the Remarketing Agent, to be delivered to the person(s) and the address(es)
indicated herein under "B. Delivery Instructions."

       With this notice, the undersigned hereby (i) represents and warrants that
the undersigned has full power and authority to tender, sell, assign and
transfer the Debentures tendered hereby and that the undersigned is the record
owner of any Debentures tendered herewith in physical form or a participant in
The Depositary Trust Company ("DTC") and the beneficial owner of any Debentures
tendered herewith by book-entry transfer to your account at DTC and (ii) agrees
to be bound by the terms

                                      C-1
<PAGE>

and conditions of Section 4.5(d) of the Pledge Agreement. Capitalized terms used
herein but not defined shall have the meaning set forth in the Pledge Agreement.

Date: _______________
                                        Signature:__________________________

                                        Signature Guarantee:

Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the 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 Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

Name:      ________________________________
           (Please Print)

Address:   ________________________________
           (Please Print)
Country:

Zip Code:

Telecopy (include country code if outside U.S.):

Telephone (include country code if outside U.S.):

(Tax Identification or Social Security Number):

A. PAYMENT INSTRUCTIONS

Proceeds of the remarketing should be paid by check in the name of the person(s)
set forth below and mailed to the address set forth below.

Name(s):  ________________________________
          (Please Print)

Address:  ________________________________
          (Please Print)

                                      C-2
<PAGE>

Zip Code:

Country:

Telecopy (include country code if outside U.S.):

Telephone (include country code if outside U.S.):

(Tax Identification or Social Security Number):

                                      C-3
<PAGE>

B. DELIVERY INSTRUCTIONS

In the event of a Failed Remarketing, Debentures which are in physical form
should be delivered to the person(s) set forth below and mailed to the address
set forth below.

Name(s):  ________________________________
          (Please Print)

Address:  ________________________________
          (Please Print)

Zip Code:

Country:

Telecopy (include country code if outside U.S.):

Telephone (include country code if outside U.S.):

(Tax Identification or Social Security Number):

In the event of a Failed Remarketing, Debentures which are in book-entry form
should be credited to the account at The Depository Trust Company set forth
below.

Name of Account Party:                                    DTC Account Number:

                                      C-4
<PAGE>

                                    EXHIBIT D

                    INSTRUCTION TO CUSTODIAL AGENT REGARDING
                           WITHDRAWAL FROM REMARKETING

U.S. Bank, N.A.
180 East Fifth Street
St. Paul, MN 55101
Attn: Corporate Trust Services/Frank Leslie
Attention: ____________________
Telecopy: ___________________
Telephone: __________________

              Re: Debentures of Solectron Corporation (the "Company")

       The undersigned hereby notifies you in accordance with Section 4.5(d) of
the Pledge Agreement, dated as of December 27, 2001 (the "Pledge Agreement"),
among the Company, yourselves, as Collateral Agent, Securities Intermediary and
Custodial Agent and State Street Bank and Trust Company of California, N.A., as
Purchase Contract Agent and as attorney-in-fact for the Holders of Normal Units
and Stripped Units from time to time, that the undersigned elects to withdraw
the $_____ aggregate principal amount of Debentures delivered to the Custodial
Agent on ___________, 2004 for remarketing pursuant to Section 4.5(d) of the
Pledge Agreement. The undersigned hereby instructs you to return such Debentures
to the undersigned in accordance with the undersigned's instructions. With this
notice, the Undersigned hereby agrees to be bound by the terms and conditions of
Section 4.5(d) of the Pledge Agreement. Capitalized terms used herein but not
defined shall have the meaning set forth in the Pledge Agreement.

Date: _______________
                                            Signature:__________________________

                                            Signature Guarantee:
Name(s):   ________________________________
           (Please Print)

Address:   ________________________________
           (Please Print)

                                      D-1
<PAGE>

Zip Code:

Country:

Telecopy (include country code if outside U.S.):

Telephone (include country code if outside U.S.):

(Tax Identification or Social Security Number):

Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the 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 Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

A. DELIVERY INSTRUCTIONS

In the event of a Failed Remarketing, Debentures which are in physical form
should be delivered to the person(s) set forth below and mailed to the address
set forth below.

Name(s):  ________________________________
          (Please Print)

Address:  ________________________________
          (Please Print)

Zip Code:

Country:

Telecopy (include country code if outside U.S.):

Telephone (include country code if outside U.S.):

(Tax Identification or Social Security Number):

In the event of a Failed Remarketing, Debentures which are in book-entry form
should be credited to the account at The Depository Trust Company set forth
below.

Name of Account Party:                                    DTC Account Number:

                                      D-2

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