Document:

<PAGE>   1
                                                                     EXHIBIT 4.1

================================================================================

                                   CONOCO INC.
                                                                       as Issuer

                                       and

                                 BANK ONE, N.A.
                                                                      as Trustee

                                   ----------

                                    Indenture

                           Dated as of April 15, 1999

                                   ----------

                                 Debt Securities

================================================================================

<PAGE>   2

                                   CONOCO INC.

           RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT OF 1939
                    AND INDENTURE, DATED AS OF APRIL 15, 1999

                                   ----------

<Table>
<Caption>
    Section of
  Trust Indenture                                                                                  Section(s) of
    Act of 1939                                                                                      Indenture
  ---------------                                                                                  -------------
<S>          <C>                                                                                   <C>
Section 310  (a)(1)..........................................................................      7.10
             (a)(2)..........................................................................      7.10
             (a)(3)..........................................................................      Not Applicable
             (a)(4)..........................................................................      Not Applicable
             (a)(5)..........................................................................      7.10
             (b).............................................................................      7.08, 7.10
Section 311  (a).............................................................................      7.11
             (b).............................................................................      7.11
             (c).............................................................................      Not Applicable
Section 312  (a).............................................................................      2.07
             (b).............................................................................      10.03
             (c).............................................................................      10.03
Section 313  (a).............................................................................      7.06
             (b).............................................................................      7.06
             (c).............................................................................      7.06
             (d).............................................................................      7.06
Section 314  (a).............................................................................      4.03, 4.04
             (b).............................................................................      Not Applicable
             (c)(1)..........................................................................      10.04
             (c)(2)..........................................................................      10.04
             (c)(3)..........................................................................      Not Applicable
             (d).............................................................................      Not Applicable
             (e).............................................................................      10.05
Section 315  (a).............................................................................      7.01(b)
             (b).............................................................................      7.05
             (c).............................................................................      7.01(a)
             (d).............................................................................      7.01(c)
             (d)(1)..........................................................................      7.01(c)(1)
             (d)(2)..........................................................................      7.01(c)(2)
             (d)(3)..........................................................................      7.01(c)(3)
             (e).............................................................................      6.11
Section 316  (a)(1)(A).......................................................................      6.05
             (a)(1)(B).......................................................................      6.04
             (a)(2)..........................................................................      Not Applicable
             (a)(last sentence)..............................................................      2.11
             (b).............................................................................      6.07
Section 317  (a)(1)..........................................................................      6.08
             (a)(2)..........................................................................      6.09
             (b).............................................................................      2.06
Section 318  (a).............................................................................      10.01
</Table>

----------

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

<PAGE>   3

                                TABLE OF CONTENTS
<Table>
<Caption>
                                                                                                               Page
                                                                                                               ----
<S>               <C>                                                                                          <C>
                                                     ARTICLE I
                                     DEFINITIONS AND INCORPORATION BY REFERENCE

SECTION 1.01      Definitions.....................................................................................1
SECTION 1.02      Other Definitions...............................................................................7
SECTION 1.03      Incorporation by Reference of Trust Indenture Act...............................................7
SECTION 1.04      Rules of Construction...........................................................................8

                                                     ARTICLE II
                                                   THE SECURITIES

SECTION 2.01      Amount Unlimited; Issuable in Series............................................................8
SECTION 2.02      Denominations..................................................................................11
SECTION 2.03      Forms Generally................................................................................11
SECTION 2.04      Execution, Authentication, Delivery and Dating.................................................12
SECTION 2.05      Registrar and Paying Agent.....................................................................14
SECTION 2.06      Paying Agent to Hold Money in Trust............................................................14
SECTION 2.07      Holder Lists...................................................................................14
SECTION 2.08      Transfer and Exchange..........................................................................15
SECTION 2.09      Replacement Securities.........................................................................15
SECTION 2.10      Outstanding Securities.........................................................................16
SECTION 2.11      Original Issue Discount, Foreign-Currency Denominated and Treasury Securities..................16
SECTION 2.12      Temporary Securities...........................................................................16
SECTION 2.13      Cancellation...................................................................................17
SECTION 2.14      Payments; Defaulted Interest...................................................................17
SECTION 2.15      Persons Deemed Owners..........................................................................17
SECTION 2.16      Computation of Interest........................................................................18
SECTION 2.17      Global Securities; Book-Entry Provisions.......................................................18

                                                    ARTICLE III
                                                     REDEMPTION

SECTION 3.01      Applicability of Article.......................................................................20
SECTION 3.02      Notice to the Trustee..........................................................................20
SECTION 3.03      Selection of Securities To Be Redeemed.........................................................20
SECTION 3.04      Notice of Redemption...........................................................................21
SECTION 3.05      Effect of Notice of Redemption.................................................................22
SECTION 3.06      Deposit of Redemption Price....................................................................22
SECTION 3.07      Securities Redeemed or Purchased in Part.......................................................22
SECTION 3.08      Purchase of Securities.........................................................................22
</Table>

                                       -i-
<PAGE>   4

<Table>
<S>               <C>                                                                                          <C>
SECTION 3.09      Mandatory and Optional Sinking Funds...........................................................23
SECTION 3.10      Satisfaction of Sinking Fund Payments with Securities..........................................23
SECTION 3.11      Redemption of Securities for Sinking Fund......................................................23

                                                     ARTICLE IV
                                                     COVENANTS

SECTION 4.01      Payment of Securities..........................................................................24
SECTION 4.02      Maintenance of Office or Agency................................................................24
SECTION 4.03      SEC Reports; Financial Statements..............................................................25
SECTION 4.04      Compliance Certificate.........................................................................25
SECTION 4.05      Corporate Existence............................................................................26
SECTION 4.06      Waiver of Stay, Extension or Usury Laws........................................................26
SECTION 4.07      Additional Amounts.............................................................................26
SECTION 4.08      Limitation on Liens............................................................................27
SECTION 4.09      Limitation on Sale/Leaseback Transactions......................................................28

                                                     ARTICLE V
                                                     SUCCESSORS

SECTION 5.01      Limitations on Mergers and Consolidations......................................................28
SECTION 5.02      Successor Person Substituted...................................................................29

                                                     ARTICLE VI
                                               DEFAULTS AND REMEDIES

SECTION 6.01      Events of Default..............................................................................29
SECTION 6.02      Acceleration...................................................................................31
SECTION 6.03      Other Remedies.................................................................................32
SECTION 6.04      Waiver of Defaults.............................................................................32
SECTION 6.05      Control by Majority............................................................................32
SECTION 6.06      Limitations on Suits...........................................................................33
SECTION 6.07      Rights of Holders to Receive Payment...........................................................33
SECTION 6.08      Collection Suit by Trustee.....................................................................33
SECTION 6.09      Trustee May File Proofs of Claim...............................................................34
SECTION 6.10      Priorities.....................................................................................34
SECTION 6.11      Undertaking for Costs..........................................................................35

                                                    ARTICLE VII
                                                      TRUSTEE

SECTION 7.01      Duties of Trustee..............................................................................35
SECTION 7.02      Rights of Trustee..............................................................................36
SECTION 7.03      May Hold Securities............................................................................37
SECTION 7.04      Trustee's Disclaimer...........................................................................37
</Table>

                                      -ii-
<PAGE>   5

<Table>
<S>               <C>                                                                                          <C>
SECTION 7.05      Notice of Defaults.............................................................................37
SECTION 7.06      Reports by Trustee to Holders..................................................................37
SECTION 7.07      Compensation and Indemnity.....................................................................38
SECTION 7.08      Replacement of Trustee.........................................................................38
SECTION 7.09      Successor Trustee by Merger, etc...............................................................40
SECTION 7.10      Eligibility; Disqualification..................................................................40
SECTION 7.11      Preferential Collection of Claims Against Company..............................................41

                                                    ARTICLE VIII
                                               DISCHARGE OF INDENTURE

SECTION 8.01      Termination of Company's Obligations...........................................................41
SECTION 8.02      Application of Trust Money.....................................................................45
SECTION 8.03      Repayment to Company...........................................................................45
SECTION 8.04      Reinstatement..................................................................................45

                                                     ARTICLE IX
                                       SUPPLEMENTAL INDENTURES AND AMENDMENTS

SECTION 9.01      Without Consent of Holders.....................................................................46
SECTION 9.02      With Consent of Holders........................................................................47
SECTION 9.03      Compliance with Trust Indenture Act............................................................49
SECTION 9.04      Revocation and Effect of Consents..............................................................49
SECTION 9.05      Notation on or Exchange of Securities..........................................................49
SECTION 9.06      Trustee to Sign Amendments, etc................................................................50

                                                     ARTICLE X
                                                   MISCELLANEOUS

SECTION 10.01     Trust Indenture Act Controls...................................................................50
SECTION 10.02     Notices........................................................................................50
SECTION 10.03     Communication by Holders with Other Holders....................................................51
SECTION 10.04     Certificate and Opinion as to Conditions Precedent.............................................52
SECTION 10.05     Statements Required in Certificate or Opinion..................................................52
SECTION 10.06     Rules by Trustee and Agents....................................................................52
SECTION 10.07     Legal Holidays.................................................................................53
SECTION 10.08     No Recourse Against Others.....................................................................53
SECTION 10.09     Governing Law..................................................................................53
SECTION 10.10     No Adverse Interpretation of Other Agreements..................................................53
SECTION 10.11     Successors.....................................................................................53
SECTION 10.12     Severability...................................................................................53
SECTION 10.13     Counterpart Originals..........................................................................53
SECTION 10.14     Table of Contents, Headings, etc...............................................................54
</Table>

                                      -iii-
<PAGE>   6

                  INDENTURE dated as of April 15, 1999 between Conoco Inc., a
Delaware corporation (the "Company"), and Bank One, N.A., a national banking
association, as trustee (the "Trustee").

                  Each party agrees as follows for the benefit of the other
party and for the equal and ratable benefit of the Holders of the Company's
unsecured debentures, notes or other evidences of indebtedness (the
"Securities") to be issued from time to time in one or more series as provided
in this Indenture:

                                    ARTICLE I
                   DEFINITIONS AND INCORPORATION BY REFERENCE

SECTION 1.01 Definitions.

                  "Additional Amounts" means any additional amounts required by
the express terms of a Security or by or pursuant to a Board Resolution, under
circumstances specified therein or pursuant thereto, to be paid by the Company
with respect to certain taxes, assessments or other governmental charges imposed
on certain Holders and that are owing to such Holders.

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

                  "Agent" means any Registrar or Paying Agent.

                  "Attributable Debt," when used with respect to any
Sale/Leaseback Transaction, means, as at the time of determination, the present
value (discounted at the rate set forth or implicit in the terms of the lease
included in such transaction) of the total obligations of the lessee for rental
payments (other than amounts required to be paid on account of taxes,
maintenance, repairs, insurance, assessments, utilities, operating and labor
costs and other items which do not constitute payments for property rights)
during the remaining term of the lease included in such Sale/Leaseback
Transaction (including any period for which such lease has been extended). In
the case of any lease which is terminable by the lessee upon the payment of a
penalty, such net amount shall be the lesser of the net amount determined
assuming termination upon the first date such lease may be terminated (in which
case the net amount shall also include the amount of the penalty, but no rent
shall be considered as required to be paid under such lease subsequent to the
first date upon which it may be so terminated) or the net amount determined
assuming no such termination.

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

                                       1
<PAGE>   7

                  "Board of Directors" means the Board of Directors of the
Company or any committee thereof duly authorized, with respect to any particular
matter, to act by or on behalf of the Board of Directors of the Company.

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

                  "Business Day" means any day that is not a Legal Holiday.

                  "Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor corporation shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor corporation; provided, however, that for
purposes of any provision contained herein which is required by the TIA,
"Company" shall also mean each other obligor (if any) on the Securities of a
series.

                  "Company Order" and "Company Request" mean, respectively, a
written order or request signed in the name of the Company by two Officers of
the Company, and delivered to the Trustee.

                  "Consolidated Net Tangible Assets" means the total amount of
assets (after deducting applicable accumulated depreciation, depletion and
amortization and other reserves and other properly deductible items) less (1)
all current liabilities (excluding the amount of those liabilities which are by
their terms extendable or renewable at the option of the obligor to a date more
than 12 months after the date as of which the amount is being determined and
current maturities of long-term debt) and (2) all goodwill, tradenames,
trademarks, patents, unamortized debt discount and expense and other like
intangible assets, all as set forth on the most recent quarterly balance sheet
of the Company and its consolidated subsidiaries and determined in accordance
with GAAP.

                  "Corporate Trust Office of the Trustee" means the office of
the Trustee located at 100 East Broad Street, 8th Floor, Columbus, Ohio 43215,
and as may be located at such other address as the Trustee may give notice to
the Company.

                  "Debt" means all notes, bonds, debentures or other similar
evidences of debt for money borrowed.

                  "Default" means any event, act or condition that is, or after
notice or the passage of time or both would be, an Event of Default.

                  "Depositary" means, with respect to the Securities of any
series issuable or issued in whole or in part in global form, the Person
specified pursuant to Section 2.01 hereof as the initial Depositary with respect
to the Securities of such series, until a successor shall have been appointed
and become such pursuant to the applicable provision of this Indenture, and
thereafter "Depositary" shall mean or include such successor.

                                       2
<PAGE>   8

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

                  "Exchange Act" means the Securities Exchange Act of 1934, as
amended, and any successor statute.

                  "Funded Debt" means all Debt (including Debt incurred under
any revolving credit, letter of credit or working capital facility) that matures
by its terms, or that is renewable at the option of any obligor thereon, to a
date more than one year after the date on which such Debt is originally
incurred.

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

                  "Global Security" means a Security that is issued in global
form in the name of the Depositary with respect thereto or its nominee.

                  "Government Obligations" means, with respect to a series of
Securities, direct obligations of the government that issues the currency in
which the Securities of the series are payable for the payment of which the full
faith and credit of such government is pledged, or obligations of a Person
controlled or supervised by and acting as an agency or instrumentality of such
government, the payment of which is unconditionally guaranteed as a full faith
and credit obligation by such government.

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

                  "Indenture" means this Indenture as amended or supplemented
from time to time, and includes the terms of a particular series of Securities
established as contemplated by Section 2.01.

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

                  "Interest Payment Date," when used with respect to any
Security, shall have the meaning assigned to such term in the Security as
contemplated by Section 2.01.

                  "Issue Date" means, with respect to Securities of a series,
the date on which the Securities of such series are originally issued under this
Indenture.

                  "Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions in any of The City of New York, New York; Columbus, Ohio;
Houston, Texas or a Place of Payment are authorized or obligated by law,
regulation or executive order to remain closed.

                                       3
<PAGE>   9

                  "Lien" means any mortgage, pledge, lien or security interest.

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

                  "Officer" means the Chairman of the Board, the President, any
Vice Chairman of the Board, any Vice President, the Chief Financial Officer, the
Treasurer, any Assistant Treasurer, the Controller, the Secretary or any
Assistant Secretary of a Person.

                  "Officers' Certificate" means a certificate signed by two
Officers of a Person.

                  "Opinion of Counsel" means a written opinion from legal
counsel who is acceptable to the Trustee. Such counsel may be an employee of or
counsel to the Company or the Trustee.

                  "Original Issue Discount Security" means any Security that
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant to
Section 6.02.

                  "Permitted Liens" means:

                  (i) Liens existing on the date of first issuance of a series
         of Securities;

                  (ii) Liens on property or assets of, or any shares of stock
         of, or other equity interests in, or Debt of, any Person existing at
         the time such Person becomes a Subsidiary or a Principal Domestic
         Subsidiary or at the time such Person is merged into or consolidated
         with the Company or any Subsidiary or at the time of a sale, lease or
         other disposition of the properties of a Person (or a division thereof)
         as an entirety or substantially as an entirety to the Company or a
         Subsidiary;

                  (iii) Liens on assets (including improvements and accessions
         thereto and proceeds thereof) (a) existing at the time of acquisition
         thereof, (b) securing all or any portion of the cost of acquiring,
         constructing, improving, developing or expanding such assets or (c)
         securing Debt incurred prior to, at the time of, or within 12 months
         after, the later of the acquisition, the completion of construction,
         improvement, development or expansion or the commencement of commercial
         operation of such assets, for the purpose (in the case of this clause
         (c)) of (x) financing all or any part of the purchase price of such
         assets or (y) financing all or any part of the cost of construction,
         improvement, development or expansion of any such assets;

                  (iv) Liens on specific assets to secure Debt incurred to
         provide funds for all or any part of the cost of exploration, drilling
         or development of such assets;

                  (v) Liens in favor of the Company or any Subsidiary;

                                       4
<PAGE>   10

                  (vi) Liens securing industrial development, pollution control
         or other revenue bonds issued or guaranteed by the United States of
         America, or any State, or any department, agency, instrumentality or
         political subdivision of either;

                  (vii) statutory liens or landlords', carriers',
         warehouseman's, mechanics', suppliers', materialmen's, repairmen's or
         other like Liens arising in the ordinary course of business and with
         respect to amounts not yet delinquent or being contested in good faith
         by appropriate proceedings; and

                  (viii) any extensions, substitutions, replacements or renewals
         in whole or in part of a Lien enumerated in clauses (i) through (vii)
         above or any Debt secured by such a Lien; provided that (a) such new
         Lien shall be limited to all or part of the same property that secured
         the original Lien, plus improvements on such property, and (b) the
         principal amount of Debt secured by such Lien and not otherwise
         authorized by clauses (i) through (vii) above or otherwise permitted
         does not materially exceed the principal amount of Debt so secured plus
         any premium or fee payable in connection with any such extension,
         substitution, replacement or renewal.

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

                  "Place of Payment" means, with respect to the Securities of
any series, the place or places where the principal of, premium (if any) on and
interest on the Securities of that series are payable as specified in accordance
with Section 2.01 subject to the provisions of Section 4.02.

                  "principal" of a Security means the principal of the Security
plus, when appropriate, the premium, if any, on the Security.

                  "Principal Domestic Subsidiary" means any Subsidiary that has
substantially all of its assets located in the United States of America and that
owns a Principal Property.

                  "Principal Property" means any oil or gas producing property
located in the United States, onshore or offshore, or any refinery or
manufacturing plant (excluding any transportation or marketing facilities or
assets) located in the United States owned by the Company or a Principal
Domestic Subsidiary, except any oil or gas producing property, refinery or plant
that in the opinion of the Board of Directors is not of material importance to
the total business conducted by the Company and its consolidated subsidiaries.

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

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

                                       5
<PAGE>   11

                  "Rule 144A Securities" means Securities of a series designated
pursuant to Section 2.01 as entitled to the benefits of Section 4.03(b).

                  "Sale/Leaseback Transaction" means any arrangement with any
Person pursuant to which the Company or any Subsidiary leases any Principal
Property that has been or is to be sold or transferred by the Company or such
Subsidiary to such Person, other than (1) temporary leases for a term, including
renewals at the option of the lessee, of not more than three years, (2) leases
between the Company and a Subsidiary or between Subsidiaries, (3) leases of
Principal Property executed by the time of, or within 12 months after the latest
of, the acquisition, the completion of construction or improvement, or the
commencement of commercial operation of the Principal Property, and (4)
arrangements pursuant to any provision of law with an effect similar to the
former Section 168(f)(8) of the Internal Revenue Code of 1954.

                  "SEC" means the Securities and Exchange Commission.

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

                  "Security Custodian" means, with respect to Securities of a
series, the Trustee for Securities of such series, as custodian with respect to
the Securities of such series issued in global form, or any successor entity
thereto.

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

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

                  "TIA" means the Trust Indenture Act of 1939, as amended (15
U.S.C. Sections 77aaa-77bbbb), as in effect on the date hereof.

                  "Trust Officer" means any officer or assistant officer of the
Trustee assigned by the Trustee to administer its corporate trust matters.

                  "Trustee" means the Person named as such above until a
successor replaces it in accordance with the applicable provisions of this
Indenture, and thereafter "Trustee" means each Person who is then a Trustee
hereunder, and if at any time there is more than one such Person, "Trustee" as
used with respect to the Securities of any series means the Trustee with respect
to Securities of that series.

                                       6
<PAGE>   12

                  "United States" means the United States of America (including
the States and the District of Columbia) and its "possessions," which include
Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the
Northern Mariana Islands.

                  "United States Alien" means any Person who, for United States
federal income tax purposes, is a foreign corporation, a nonresident alien
individual, a nonresident alien or foreign fiduciary of an estate or trust, or a
foreign partnership.

                  "U.S. Government Obligations" means Government Obligations
with respect to Securities payable in Dollars.

SECTION 1.02 Other Definitions.

<Table>
<Caption>
                                                                                                        DEFINED
         TERM                                                                                          IN SECTION
        ----                                                                                           ----------
<S>                                                                                                    <C>
"Bankruptcy Custodian"...........................................................................         6.01
"Conversion Event"...............................................................................         6.01
"covenant defeasance"............................................................................         8.01
"Event of Default"...............................................................................         6.01
"Exchange Rate"..................................................................................         2.11
"Judgment Currency"..............................................................................         6.10
"legal defeasance"...............................................................................         8.01
"mandatory sinking fund payment".................................................................         3.09
"optional sinking fund payment"..................................................................         3.09
"Paying Agent"...................................................................................         2.05
"Registrar"......................................................................................         2.05
"Required Currency"..............................................................................         6.10
"Successor"......................................................................................         5.01
</Table>

SECTION 1.03 Incorporation by Reference of Trust Indenture Act.

                  Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:

                  "Commission" means the SEC.

                  "indenture securities" means the Securities.

                  "indenture security holder" means a Holder.

                  "indenture to be qualified" means this Indenture.

                  "indenture trustee" or "institutional trustee" means the
Trustee.

                                       7
<PAGE>   13

                  "obligor" on the indenture securities means the Company or any
         other obligor on the Securities.

                  All terms used in this Indenture that are defined by the TIA,
defined by a TIA reference to another statute or defined by an SEC rule under
the TIA have the meanings so assigned to them.

SECTION 1.04 Rules of Construction.

                  Unless the context otherwise requires:

                  (1)      a term has the meaning assigned to it;

                  (2)      an accounting term not otherwise defined has the
                           meaning assigned to it in accordance with GAAP;

                  (3)      "or" is not exclusive;

                  (4)      words in the singular include the plural, and in the
                           plural include the singular;

                  (5)      provisions apply to successive events and
                           transactions; and

                  (6)      all references in this instrument to Articles and
                           Sections are references to the corresponding Articles
                           and Sections in and of this instrument.

                                   ARTICLE II
                                 THE SECURITIES

SECTION 2.01 Amount Unlimited; Issuable in Series.

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

                  The Securities may be issued in one or more series. There
shall be established in or pursuant to a Board Resolution, and set forth, or
determined in the manner provided, in an Officers' Certificate or in a Company
Order, or established in one or more indentures supplemental hereto, prior to
the issuance of Securities of any series:

                  (1) the title of the Securities of the series (which shall
         distinguish the Securities of the series from the Securities of all
         other series);

                  (2) if there is to be a limit, the limit upon the aggregate
         principal amount of the Securities of the series that may be
         authenticated and delivered under this Indenture (except for Securities
         authenticated and delivered upon registration of transfer of, or in
         exchange for, or in lieu of, other Securities of the series pursuant to
         Section 2.08, 2.09, 2.12, 2.17, 3.07 or

                                       8
<PAGE>   14

         9.05 and except for any Securities which, pursuant to Section 2.04 or
         2.17, are deemed never to have been authenticated and delivered
         hereunder); provided, however, that unless otherwise provided in the
         terms of the series, the authorized aggregate principal amount of such
         series may be increased before or after the issuance of any Securities
         of the series by a Board Resolution (or action pursuant to a Board
         Resolution) to such effect;

                  (3) whether any Securities of the series are to be issuable
         initially in temporary global form and whether any Securities of the
         series are to be issuable in permanent global form, as Global
         Securities or otherwise, and, if so, whether beneficial owners of
         interests in any such Global Security may exchange such interests for
         Securities of such series and of like tenor of any authorized form and
         denomination and the circumstances under which any such exchanges may
         occur, if other than in the manner provided in Section 2.17, and the
         initial Depositary and Security Custodian, if any, for any Global
         Security or Securities of such series;

                  (4) the manner in which any interest payable on a temporary
         Global Security on any Interest Payment Date will be paid if other than
         in the manner provided in Section 2.14;

                  (5) the date or dates on which the principal of (and premium,
         if any, on) the Securities of the series is payable or the method of
         determination thereof;

                  (6) the rate or rates, or the method of determination thereof,
         at which the Securities of the series shall bear interest, if any,
         whether and under what circumstances Additional Amounts with respect to
         such Securities shall be payable, the date or dates from which such
         interest shall accrue, the Interest Payment Dates on which such
         interest shall be payable and the record date for the interest payable
         on any Securities on any Interest Payment Date, or if other than
         provided herein, the Person to whom any interest on Securities of the
         series shall be payable;

                  (7) the place or places where, subject to the provisions of
         Section 4.02, the principal, premium (if any), interest and any
         Additional Amounts with respect to the Securities of the series shall
         be payable;

                  (8) the period or periods within which, the price or prices
         (whether denominated in cash, securities or otherwise) at which and the
         terms and conditions upon which Securities of the series may be
         redeemed, in whole or in part, at the option of the Company, if the
         Company is to have that option, and the manner in which the Company
         must exercise any such option, if different from those set forth
         herein;

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

                                       9
<PAGE>   15

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

                  (11) if other than Dollars, the currency or currencies
         (including composite currencies) or the form, including equity
         securities, other debt securities (including Securities), warrants or
         any other securities or property of the Company or any other Person, in
         which payment of the principal, premium (if any), interest and any
         Additional Amounts with respect to the Securities of the series shall
         be payable;

                  (12) if the principal of, premium (if any) or interest on or
         any Additional Amounts with respect to the Securities of the series are
         to be payable, at the election of the Company or a Holder thereof, in a
         currency or currencies (including composite currencies) other than that
         in which the Securities are stated to be payable, the currency or
         currencies (including composite currencies) in which payment of the
         principal, premium (if any), interest and any Additional Amounts with
         respect to Securities of such series as to which such election is made
         shall be payable, and the periods within which and the terms and
         conditions upon which such election is to be made;

                  (13) if the amount of payments of principal, premium (if any),
         interest and any Additional Amounts with respect to the Securities of
         the series may be determined with reference to any commodities,
         currencies or indices, values, rates or prices or any other index or
         formula, the manner in which such amounts shall be determined;

                  (14) if other than the entire principal amount thereof, the
         portion of the principal amount of Securities of the series that shall
         be payable upon declaration of acceleration of the Maturity thereof
         pursuant to Section 6.02;

                  (15) any additional means of satisfaction and discharge of
         this Indenture and any additional conditions or limitations to
         discharge with respect to Securities of the series pursuant to Article
         VIII or any modifications of or deletions from such conditions or
         limitations;

                  (16) any deletions or modifications of or additions to the
         Events of Default set forth in Section 6.01 or covenants of the Company
         set forth in Article IV pertaining to the Securities of the series;

                  (17) any restrictions or other provisions with respect to the
         transfer or exchange of Securities of the series, which may amend,
         supplement, modify or supersede those contained in this Article II;

                  (18) if the Securities of the series are to be convertible
         into or exchangeable for capital stock, other debt securities
         (including Securities), warrants, other equity securities or any other
         securities or property of the Company or any other Person, at the
         option of the Company or the Holder or upon the occurrence of any
         condition or event, the terms and conditions for such conversion or
         exchange;

                                       10
<PAGE>   16

                  (19) if the Securities of the series are to be entitled to the
         benefit of Section 4.03(b) (and accordingly constitute Rule 144A
         Securities); and

                  (20) any other terms of the series (which terms shall not be
         prohibited by the provisions of this Indenture).

                  All Securities of any one series shall be substantially
identical except as to denomination and except as may otherwise be provided in
or pursuant to the Board Resolution referred to above and (subject to Section
2.03) set forth, or determined in the manner provided, in the Officers'
Certificate or Company Order referred to above or in any such indenture
supplemental hereto.

                  If any of the terms of the series are established by action
taken pursuant to a Board Resolution, a copy of an appropriate record of such
action, together with such Board Resolution, shall be set forth in an Officers'
Certificate or certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the
Officers' Certificate or Company Order setting forth the terms of the series.

SECTION 2.02 Denominations.

                  The Securities of each series shall be issuable in such
denominations as shall be specified as contemplated by Section 2.01. In the
absence of any such provisions with respect to the Securities of any series, the
Securities of such series denominated in Dollars shall be issuable in
denominations of $1,000 and any integral multiples thereof.

SECTION 2.03 Forms Generally.

                  The Securities of each series shall be in fully registered
form and in substantially such form or forms (including temporary or permanent
global form) established by or pursuant to a Board Resolution or in one or more
indentures supplemental hereto. The Securities may have notations, legends or
endorsements required by law, securities exchange rule, the Company's
certificate of incorporation, bylaws or other similar governing documents,
agreements to which the Company is subject, if any, or usage (provided that any
such notation, legend or endorsement is in a form acceptable to the Company). A
copy of the Board Resolution establishing the form or forms of Securities of any
series shall be delivered to the Trustee at or prior to the delivery of the
Company Order contemplated by Section 2.04 for the authentication and delivery
of such Securities.

                  The definitive Securities of each series shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the Officers executing such Securities, as
evidenced by their execution thereof.

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

                                       11
<PAGE>   17

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

                                       BANK ONE, N.A., as Trustee

                                       By:
                                          --------------------------------------
                                                     Authorized Officer".

SECTION 2.04 Execution, Authentication, Delivery and Dating.

                  Two Officers of the Company shall sign the Securities on
behalf of the Company by manual or facsimile signature. The Company's seal, if
any, shall be impressed, affixed, imprinted or reproduced on the Securities and
may be in facsimile form.

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

                  A Security shall not be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose until authenticated by the
manual signature of an authorized signatory of the Trustee, which signature
shall be conclusive evidence that the Security has been authenticated under this
Indenture. Notwithstanding the foregoing, if any Security has been authenticated
and delivered hereunder but never issued and sold by the Company, and the
Company delivers such Security to the Trustee for cancellation as provided in
Section 2.13, together with a written statement (which need not comply with
Section 10.05 and need not be accompanied by an Opinion of Counsel) stating that
such Security has never been issued and sold by the Company, for all purposes of
this Indenture such Security shall be deemed never to have been authenticated
and delivered hereunder and shall never be entitled to the benefits of this
Indenture.

                  At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities of any series
executed by the Company to the Trustee for authentication, and the Trustee shall
authenticate and deliver such Securities for original issue upon a Company Order
for the authentication and delivery of such Securities or pursuant to such
procedures acceptable to the Trustee as may be specified from time to time by
Company Order. Such order shall specify the amount of the Securities to be
authenticated, the date on which the original issue of Securities is to be
authenticated, the name or names of the initial Holder or Holders and any other
terms of the Securities of such series not otherwise determined. If provided for
in such procedures, such Company Order may authorize (1) authentication and
delivery of Securities of such series for original issue from time to time, with
certain terms (including, without limitation, the Maturity dates or dates,
original issue date or dates and interest rate or rates) that differ from
Security to Security and (2) may authorize authentication and delivery pursuant
to oral or electronic instructions from the Company or its duly authorized
agent, which instructions shall be promptly confirmed in writing.

                  If the form or terms of the Securities of the series have been
established in or pursuant to one or more Board Resolutions as permitted by
Section 2.01, in authenticating such Securities,

                                       12
<PAGE>   18

and accepting the additional responsibilities under this Indenture in relation
to such Securities, the Trustee shall be entitled to receive (in addition to the
Company Order referred to above and the other documents required by Section
10.04), and (subject to Section 7.01) shall be fully protected in relying upon,

                  (a) an Officers' Certificate setting forth the Board
         Resolution and, if applicable, an appropriate record of any action
         taken pursuant thereto, as contemplated by the last paragraph of
         Section 2.01; and

                  (b) an Opinion of Counsel to the effect that:

                           (i) the form of such Securities has been established
                  in conformity with the provisions of this Indenture;

                           (ii) the terms of such Securities have been
                  established in conformity with the provisions of this
                  Indenture; and

                           (iii) that such Securities, when authenticated and
                  delivered by the Trustee and issued by the Company in the
                  manner and subject to any conditions specified in such Opinion
                  of Counsel, will constitute valid and binding obligations of
                  the Company, enforceable against the Company in accordance
                  with their terms, except as the enforceability thereof may be
                  limited by applicable bankruptcy, insolvency, reorganization,
                  moratorium, fraudulent conveyance or other similar laws in
                  effect from time to time affecting the rights of creditors
                  generally, and the application of general principles of equity
                  (regardless of whether such enforceability is considered in a
                  proceeding in equity or at law).

                  If all the Securities of any series are not to be issued at
one time, it shall not be necessary to deliver an Officers' Certificate and
Opinion of Counsel at the time of issuance of each such Security, but such
Officers' Certificate and Opinion of Counsel shall be delivered at or before the
time of issuance of the first Security of the series to be issued.

                  The Trustee shall not be required to authenticate such
Securities if the issuance of such Securities pursuant to this Indenture would
affect the Trustee's own rights, duties or immunities under the Securities and
this Indenture or otherwise in a manner not reasonably acceptable to the
Trustee.

                  The Trustee may appoint an authenticating agent acceptable to
the Company to authenticate Securities. Unless limited by the terms of such
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Company or an Affiliate of the Company.

                  Each Security shall be dated the date of its authentication.

                                       13
<PAGE>   19

SECTION 2.05 Registrar and Paying Agent.

                  The Company shall maintain an office or agency for each series
of Securities where Securities of such series may be presented for registration
of transfer or exchange ("Registrar") and an office or agency where Securities
of such series may be presented for payment ("Paying Agent"). The Registrar
shall keep a register of the Securities of such series and of their transfer and
exchange. The Company may appoint one or more co-registrars and one or more
additional paying agents. The term "Registrar" includes any co-registrar and the
term "Paying Agent" includes any additional paying agent.

                  The Company shall enter into an appropriate agency agreement
with any Registrar or Paying Agent not a party to this Indenture. The agreement
shall implement the provisions of this Indenture that relate to such Agent. The
Company shall notify the Trustee of the name and address of any Agent not a
party to this Indenture. The Company may change any Paying Agent or Registrar
without notice to any Holder. If the Company fails to appoint or maintain
another entity as Registrar or Paying Agent, the Trustee shall act as such. The
Company or any of its Subsidiaries may act as Paying Agent or Registrar.

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

SECTION 2.06 Paying Agent to Hold Money in Trust.

                  The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent will hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
payment of principal of, premium, if any, or interest on or any Additional
Amounts with respect to Securities and will notify the Trustee of any default by
the Company in making any such payment. While any such default continues, the
Trustee may require a Paying Agent to pay all money held by it to the Trustee
and to account for any funds disbursed. The Company at any time may require a
Paying Agent to pay all money held by it to the Trustee and to account for any
funds disbursed. Upon payment over to the Trustee and upon accounting for any
funds disbursed, the Paying Agent (if other than the Company or a Subsidiary of
the Company) shall have no further liability for the money. If the Company or a
Subsidiary of the Company acts as Paying Agent, it shall segregate and hold in a
separate trust fund for the benefit of the Holders all money held by it as
Paying Agent. Each Paying Agent shall otherwise comply with TIA Section 317(b).

SECTION 2.07 Holder Lists.

                  The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of Holders and shall otherwise comply with TIA Section 312(a). If the
Trustee is not the Registrar with respect to a series of Securities, the Company
shall furnish to the Trustee at least five Business Days before each Interest
Payment Date with respect to such series of Securities, and at such other times
as the Trustee may request in writing, a list in such form and as of such date
as the Trustee may reasonably require of the names and addresses of Holders of
such series, and the Company shall otherwise comply with TIA Section 312(a).

                                       14
<PAGE>   20

SECTION 2.08 Transfer and Exchange.

                  Except as set forth in Section 2.17 or as may be provided
pursuant to Section 2.01:

                  When Securities of any series are presented to the Registrar
with the request to register the transfer of such Securities or to exchange such
Securities for an equal principal amount of Securities of the same series of
like tenor and of other authorized denominations, the Registrar shall register
the transfer or make the exchange as requested if its requirements and the
requirements of this Indenture for such transactions are met; provided, however,
that the Securities presented or surrendered for registration of transfer or
exchange shall be duly endorsed or accompanied by a written instruction of
transfer in form reasonably satisfactory to the Registrar duly executed by the
Holder thereof or by his attorney, duly authorized in writing, on which
instruction the Registrar can rely.

                  To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Securities at the
Registrar's written request and submission of the Securities or Global
Securities. No service charge shall be made to a Holder for any registration of
transfer or exchange (except as otherwise expressly permitted herein), but the
Company may require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other than such
transfer tax or similar governmental charge payable upon exchanges pursuant to
Section 2.12, 3.07 or 9.05). The Trustee shall authenticate Securities in
accordance with the provisions of Section 2.04. Notwithstanding any other
provisions of this Indenture to the contrary, the Company shall not be required
to register the transfer or exchange of (a) any Security selected for redemption
in whole or in part pursuant to Article III, except the unredeemed portion of
any Security being redeemed in part or (b) any Security during the period
beginning 15 Business Days before the mailing of notice of any offer to
repurchase Securities of the series required pursuant to the terms thereof or of
redemption of Securities of a series to be redeemed and ending at the close of
business on the date of mailing.

SECTION 2.09 Replacement Securities.

                  If any mutilated Security is surrendered to the Trustee, or if
the Holder of a Security claims that the Security has been destroyed, lost or
stolen and the Company and the Trustee receive evidence to their satisfaction of
the destruction, loss or theft of such Security, the Company shall issue and the
Trustee shall authenticate a replacement Security of the same series if the
Trustee's requirements are met. If any such mutilated, destroyed, lost or stolen
Security has become or is about to become due and payable, the Company in its
discretion may, instead of issuing a new Security, pay such Security. If
required by the Trustee or the Company, such Holder must furnish an indemnity
bond that is sufficient in the judgment of the Trustee and the Company to
protect the Company, the Trustee, any Agent or any authenticating agent from any
loss that any of them may suffer if a Security is replaced. The Company and the
Trustee may charge a Holder for their expenses in replacing a Security.

                  Every replacement Security is an additional obligation of the
Company.

                                       15
<PAGE>   21

SECTION 2.10 Outstanding Securities.

                  The Securities outstanding at any time are all the Securities
authenticated by the Trustee except for those canceled by it, those delivered to
it for cancellation, those reductions in the interest in a Global Security
effected by the Trustee hereunder and those described in this Section 2.10 as
not outstanding.

                  If a Security is replaced pursuant to Section 2.09, it ceases
to be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.

                  If the principal amount of any Security is considered paid
under Section 4.01, it ceases to be outstanding and interest on it ceases to
accrue.

                  A Security does not cease to be outstanding because the
Company or an Affiliate of the Company holds the Security.

SECTION 2.11 Original Issue Discount, Foreign-Currency Denominated and Treasury
             Securities.

                  In determining whether the Holders of the required principal
amount of Securities have concurred in any direction, amendment, supplement,
waiver or consent, (a) the principal amount of an Original Issue Discount
Security shall be the principal amount thereof that would be due and payable as
of the date of such determination upon acceleration of the Maturity thereof
pursuant to Section 6.02, (b) the principal amount of a Security denominated in
a foreign currency shall be the Dollar equivalent, as determined by the Company
by reference to the noon buying rate in The City of New York for cable transfers
for such currency, as such rate is certified for customs purposes by the Federal
Reserve Bank of New York (the "Exchange Rate") on the date of original issuance
of such Security, of the principal amount (or, in the case of an Original Issue
Discount Security, the Dollar equivalent, as determined by the Company by
reference to the Exchange Rate on the date of original issuance of such
Security, of the amount determined as provided in (a) above), of such Security
and (c) Securities owned by the Company or any other obligor upon the Securities
or any Affiliate of the Company or of such other obligor shall be disregarded,
except that, for the purpose of determining whether the Trustee shall be
protected in relying upon any such direction, amendment, supplement, waiver or
consent, only Securities that the Trustee actually knows are so owned shall be
so disregarded.

SECTION 2.12 Temporary Securities.

                  Until definitive Securities of any series are ready for
delivery, the Company may prepare and the Trustee shall authenticate temporary
Securities. Temporary Securities shall be substantially in the form of
definitive Securities, but may have variations that the Company considers
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and the Trustee shall authenticate definitive Securities in
exchange for temporary Securities.

                                       16
<PAGE>   22

Until so exchanged, the temporary Securities shall in all respects be entitled
to the same benefits under this Indenture as definitive Securities.

SECTION 2.13 Cancellation.

                  The Company at any time may deliver Securities to the Trustee
for cancellation. The Registrar and the Paying Agent shall forward to the
Trustee any Securities surrendered to them for registration of transfer,
exchange, payment or redemption or for credit against any sinking fund payment.
The Trustee shall cancel all Securities surrendered for registration of
transfer, exchange, payment, redemption, replacement or cancellation or for
credit against any sinking fund. Unless the Company shall direct in writing that
canceled Securities be returned to it, after written notice to the Company all
canceled Securities held by the Trustee shall be disposed of in accordance with
the usual disposal procedures of the Trustee, and the Trustee shall maintain a
record of their disposal. The Company may not issue new Securities to replace
Securities that have been paid or that have been delivered to the Trustee for
cancellation.

SECTION 2.14 Payments; Defaulted Interest.

                  Unless otherwise provided as contemplated by Section 2.01,
interest (except defaulted interest) on any Security that is payable, and is
punctually paid or duly provided for, on any Interest Payment Date shall be paid
to the Persons who are registered Holders of that Security at the close of
business on the record date next preceding such Interest Payment Date, even if
such Securities are canceled after such record date and on or before such
Interest Payment Date. The Holder must surrender this Security to a Paying Agent
to collect principal payments. Unless otherwise provided with respect to the
Securities of any series, the Company will pay the principal of, premium (if
any) and interest on and any Additional Amounts with respect to the Securities
in Dollars. Such amounts shall be payable at the offices of the Trustee,
provided that at the option of the Company, the Company may pay such amounts (1)
by wire transfer with respect to Global Securities or (2) by check payable in
such money mailed to a Holder's registered address with respect to any
Securities.

                  If the Company defaults in a payment of interest on the
Securities, it shall pay the defaulted interest in any lawful manner plus, to
the extent lawful, interest on the defaulted interest, in each case at the rate
provided in the Securities and in Section 4.01. The Company may pay the
defaulted interest to the Persons who are Holders on a subsequent special record
date. At least 15 days before any special record date selected by the Company,
the Company (or the Trustee, in the name of and at the expense of the Company
upon 20 days' prior written notice from the Company setting forth such record
date and the interest amount to be paid) shall mail to Holders a notice that
states the special record date, the related payment date and the amount of such
interest to be paid.

SECTION 2.15 Persons Deemed Owners.

                  The Company, the Trustee, any Agent and any authenticating
agent may treat the Person in whose name any Security is registered as the owner
of such Security for the purpose of receiving payments of principal of, premium
(if any) or interest on, or any Additional Amounts with

                                       17
<PAGE>   23

respect to such Security and for all other purposes. None of the Company, the
Trustee, any Agent or any authenticating agent shall be affected by any notice
to the contrary.

SECTION 2.16 Computation of Interest.

                  Except as otherwise specified as contemplated by Section 2.01
for Securities of any series, interest on the Securities of each series shall be
computed on the basis of a year comprising twelve 30-day months.

SECTION 2.17 Global Securities; Book-Entry Provisions.

                  If Securities of a series are issuable in global form as a
Global Security, as contemplated by Section 2.01, then, notwithstanding clause
(10) of Section 2.01 and the provisions of Section 2.02, any such Global
Security shall represent such of the outstanding Securities of such series as
shall be specified therein and may provide that it shall represent the aggregate
amount of outstanding Securities from time to time endorsed thereon and that the
aggregate amount of outstanding Securities represented thereby may from time to
time be reduced or increased, as appropriate, to reflect exchanges or
redemptions. Any endorsement of a Global Security to reflect the amount, or any
increase or decrease in the amount, of outstanding Securities represented
thereby shall be made by the Trustee (i) in such manner and upon instructions
given by such Person or Persons as shall be specified in such Security or in a
Company Order to be delivered to the Trustee pursuant to Section 2.04 or (ii)
otherwise in accordance with written instructions or such other written form of
instructions as is customary for the Depositary for such Security, from such
Depositary or its nominee on behalf of any Person having a beneficial interest
in such Global Security. Subject to the provisions of Section 2.04 and, if
applicable, Section 2.12, the Trustee shall deliver and redeliver any Security
in permanent global form in the manner and upon instructions given by the Person
or Persons specified in such Security or in the applicable Company Order. With
respect to the Securities of any series that are represented by a Global
Security, the Company authorizes the execution and delivery by the Trustee of a
letter of representations or other similar agreement or instrument in the form
customarily provided for by the Depositary appointed with respect to such Global
Security. Any Global Security may be deposited with the Depositary or its
nominee, or may remain in the custody of the Trustee or the Security Custodian
therefor pursuant to a FAST Balance Certificate Agreement or similar agreement
between the Trustee and the Depositary. If a Company Order has been, or
simultaneously is, delivered, any instructions by the Company with respect to
endorsement or delivery or redelivery of a Security in global form shall be in
writing but need not comply with Section 10.05 and need not be accompanied by an
Opinion of Counsel.

                  Members of, or participants in, the Depositary ("Agent
Members") shall have no rights under this Indenture with respect to any Global
Security held on their behalf by the Depositary, or the Trustee or the Security
Custodian as its custodian, or under such Global Security and the Depositary may
be treated by the Company, the Trustee or the Security Custodian and any agent
of the Company, the Trustee or the Security Custodian as the absolute owner of
such Global Security for all purposes whatsoever. Notwithstanding the foregoing,
(i) the registered holder of a Global Security may grant proxies and otherwise
authorize any Person, including Agent Members

                                       18
<PAGE>   24

and Persons that may hold interests through Agent Members, to take any action
that a Holder is entitled to take under this Indenture or the Securities and
(ii) nothing herein shall prevent the Company, the Trustee or the Security
Custodian, or any agent of the Company, the Trustee or the Security Custodian,
from giving effect to any written certification, proxy or other authorization
furnished by the Depositary or shall impair, as between the Depositary and its
Agent Members, the operation of customary practices governing the exercise of
the rights of a beneficial owner of any Security.

                  Notwithstanding Section 2.08, and except as otherwise provided
pursuant to Section 2.01: Transfers of a Global Security shall be limited to
transfers of such Global Security in whole, but not in part, to the Depositary,
its successors or their respective nominees. Interests of beneficial owners in a
Global Security may be transferred in accordance with the rules and procedures
of the Depositary. Securities shall be transferred to all beneficial owners in
exchange for their beneficial interests in a Global Security if, and only if,
either (1) the Depositary notifies the Company that it is unwilling or unable to
continue as Depositary for the Global Security and a successor Depositary is not
appointed by the Company within 90 days of such notice, (2) an Event of Default
has occurred with respect to such series and is continuing and the Registrar has
received a request from the Depositary to issue Securities in lieu of all or a
portion of the Global Security (in which case the Company shall deliver
Securities within 30 days of such request) or (3) the Company determines not to
have the Securities represented by a Global Security.

                  In connection with any transfer of a portion of the beneficial
interest in a Global Security to beneficial owners pursuant to this Section
2.17, the Registrar shall reflect on its books and records the date and a
decrease in the principal amount of the Global Security in an amount equal to
the principal amount of the beneficial interest in the Global Security to be
transferred, and the Company shall execute, and the Trustee upon receipt of a
Company Order for the authentication and delivery of Securities shall
authenticate and deliver, one or more Securities of the same series of like
tenor and amount.

                  In connection with the transfer of all the beneficial interest
in a Global Security to beneficial owners pursuant to this Section 2.17, the
Global Security shall be deemed to be surrendered to the Trustee for
cancellation, and the Company shall execute, and the Trustee shall authenticate
and deliver, to each beneficial owner identified by the Depositary in exchange
for its beneficial interest in the Global Security, an equal aggregate principal
amount of Securities of authorized denominations.

                  Neither the Company nor the Trustee will have any
responsibility or liability for any aspect of the records relating to, or
payments made on account of, Securities by the Depositary, or for maintaining,
supervising or reviewing any records of the Depositary relating to such
Securities. Neither the Company nor the Trustee shall be liable for any delay by
the related Global Security Holder or the Depositary in identifying the
beneficial owners, and each such Person may conclusively rely on, and shall be
protected in relying on, instructions from such Global Security Holder or the
Depositary for all purposes (including with respect to the registration and
delivery, and the respective principal amounts, of the Securities to be issued).

                                       19
<PAGE>   25

                  The provisions of the last sentence of the third paragraph of
Section 2.04 shall apply to any Global Security if such Global Security was
never issued and sold by the Company and the Company delivers to the Trustee the
Global Security together with written instructions (which need not comply with
Section 10.05 and need not be accompanied by an Opinion of Counsel) with regard
to the cancellation or reduction in the principal amount of Securities
represented thereby, together with the written statement contemplated by the
last sentence of the third paragraph of Section 2.04.

                  Notwithstanding the provisions of Sections 2.03 and 2.14,
unless otherwise specified as contemplated by Section 2.01, payment of principal
of, premium (if any) and interest on and any Additional Amounts with respect to
any Global Security shall be made to the Person or Persons specified therein.

                                   ARTICLE III
                                   REDEMPTION

SECTION 3.01 Applicability of Article.

                  Securities of any series that are redeemable before their
Stated Maturity shall be redeemable in accordance with their terms and (except
as otherwise specified as contemplated by Section 2.01 for Securities of any
series) in accordance with this Article III.

SECTION 3.02 Notice to the Trustee.

                  If the Company elects to redeem Securities of any series
pursuant to this Indenture, it shall notify the Trustee of the Redemption Date
and principal amount of Securities of such series to be redeemed. The Company
shall so notify the Trustee at least 45 days before the Redemption Date (unless
a shorter notice shall be satisfactory to the Trustee) by delivering to the
Trustee an Officers' Certificate stating that such redemption will comply with
the provisions of this Indenture and of the Securities of such series. Any such
notice may be canceled at any time prior to the mailing of such notice of such
redemption to any Holder and shall thereupon be void and of no effect.

SECTION 3.03 Selection of Securities To Be Redeemed.

                  If less than all the Securities of any series are to be
redeemed, the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the outstanding
Securities of such series not previously called for redemption, either pro rata,
by lot or by such other method as the Trustee shall deem fair and appropriate
and that may provide for the selection for redemption of portions (equal to the
minimum authorized denomination for Securities of that series or any integral
multiple thereof) of the principal amount of Securities of such series of a
denomination larger than the minimum authorized denomination for Securities of
that series or of the principal amount of Global Securities of such series.

                                       20
<PAGE>   26

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

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

SECTION 3.04 Notice of Redemption.

                  Notice of redemption shall be given by first-class mail,
postage prepaid, mailed not less than 30 nor more than 60 days prior to the
Redemption Date, to each Holder of Securities to be redeemed, at the address of
such Holder appearing in the register of Securities maintained by the Registrar.

                  All notices of redemption shall identify the Securities to be
redeemed and shall state:

                  (1) the Redemption Date;

                  (2) the Redemption Price;

                  (3) that, unless the Company defaults in making the redemption
         payment, interest on Securities called for redemption ceases to accrue
         on and after the Redemption Date, and the only remaining right of the
         Holders of such Securities is to receive payment of the Redemption
         Price upon surrender to the Paying Agent of the Securities redeemed;

                  (4) if any Security is to be redeemed in part, the portion of
         the principal amount thereof to be redeemed and that on and after the
         Redemption Date, upon surrender for cancellation of such Security to
         the Paying Agent, a new Security or Securities in the aggregate
         principal amount equal to the unredeemed portion thereof will be issued
         without charge to the Holder;

                  (5) that Securities called for redemption must be surrendered
         to the Paying Agent to collect the Redemption Price and the name and
         address of the Paying Agent;

                  (6) that the redemption is for a sinking or analogous fund, if
         such is the case; and

                  (7) the CUSIP number, if any, relating to such Securities.

                  Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
written request, by the Trustee in the name and at the expense of the Company.

                                       21
<PAGE>   27

SECTION 3.05 Effect of Notice of Redemption.

                  Once notice of redemption is mailed, Securities called for
redemption become due and payable on the Redemption Date and at the Redemption
Price. Upon surrender to the Paying Agent, such Securities called for redemption
shall be paid at the Redemption Price, but interest installments whose maturity
is on or prior to such Redemption Date will be payable on the relevant Interest
Payment Dates to the Holders of record at the close of business on the relevant
record dates specified pursuant to Section 2.01.

SECTION 3.06 Deposit of Redemption Price.

                  On or prior to any Redemption Date, the Company shall deposit
with the Trustee or the Paying Agent (or, if the Company is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 2.06) an amount
of money in same day funds sufficient to pay the Redemption Price of, and
(except if the Redemption Date shall be an Interest Payment Date) accrued
interest on and any Additional Amounts with respect to, the Securities or
portions thereof which are to be redeemed on that date, other than Securities or
portions thereof called for redemption on that date which have been delivered by
the Company to the Trustee for cancellation.

                  If the Company complies with the preceding paragraph, then,
unless the Company defaults in the payment of such Redemption Price, interest on
the Securities to be redeemed will cease to accrue on and after the applicable
Redemption Date, whether or not such Securities are presented for payment, and
the Holders of such Securities shall have no further rights with respect to such
Securities except for the right to receive the Redemption Price upon surrender
of such Securities. If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal, premium, if any, any
Additional Amounts, and, to the extent lawful, accrued interest thereon shall,
until paid, bear interest from the Redemption Date at the rate specified
pursuant to Section 2.01 or provided in the Securities or, in the case of
Original Issue Discount Securities, such Securities' yield to maturity.

SECTION 3.07 Securities Redeemed or Purchased in Part.

                  Upon surrender to the Paying Agent of a Security to be
redeemed in part, the Company shall execute and the Trustee shall authenticate
and deliver to the Holder of such Security without service charge a new Security
or Securities, of the same series and of any authorized denomination as
requested by such Holder in aggregate principal amount equal to, and in exchange
for, the unredeemed portion of the principal of the Security so surrendered that
is not redeemed.

SECTION 3.08 Purchase of Securities.

                  Unless otherwise specified as contemplated by Section 2.01,
the Company and any Affiliate of the Company may at any time purchase or
otherwise acquire Securities in the open market or by private agreement. Such
acquisition shall not operate as or be deemed for any purpose to be a redemption
of the indebtedness represented by such Securities. Any Securities purchased or
acquired by the Company may be delivered to the Trustee and, upon such delivery,
the indebtedness

                                       22
<PAGE>   28

represented thereby shall be deemed to be satisfied. Section 2.13 shall apply to
all Securities so delivered.

SECTION 3.09 Mandatory and Optional Sinking Funds.

                  The minimum amount of any sinking fund payment provided for by
the terms of Securities of any series is herein referred to as a "mandatory
sinking fund payment," and any payment in excess of such minimum amount provided
for by the terms of Securities of any series is herein referred to as an
"optional sinking fund payment." Unless otherwise provided by the terms of
Securities of any series, the cash amount of any sinking fund payment may be
subject to reduction as provided in Section 3.10. Each sinking fund payment
shall be applied to the redemption of Securities of any series as provided for
by the terms of Securities of such series and by this Article III.

SECTION 3.10 Satisfaction of Sinking Fund Payments with Securities.

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

SECTION 3.11 Redemption of Securities for Sinking Fund.

                  Not less than 45 days prior (unless a shorter period shall be
satisfactory to the Trustee) to each sinking fund payment date for any series of
Securities, the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for that series
pursuant to the terms of that series, the portion thereof, if any, which is to
be satisfied by payment of cash and the portion thereof, if any, which is to be
satisfied by delivery of or by crediting Securities of that series pursuant to
Section 3.10 and will also deliver to the Trustee any Securities to be so
delivered. Failure of the Company to timely deliver such Officers' Certificate
and Securities specified in this paragraph, if any, shall not constitute a
default but shall constitute the election of the Company (i) that the mandatory
sinking fund payment for such series due on the next succeeding sinking fund
payment date shall be paid entirely in cash without the option to deliver or
credit Securities of such series in respect thereof and (ii) that the Company
will make no optional sinking fund payment with respect to such series as
provided in this Section.

                  If the sinking fund payment or payments (mandatory or optional
or both) to be made in cash on the next succeeding sinking fund payment date
plus any unused balance of any preceding sinking fund payments made in cash
shall exceed $100,000 (or the Dollar equivalent thereof based

                                       23
<PAGE>   29

on the applicable Exchange Rate on the date of original issue of the applicable
Securities) or a lesser sum if the Company shall so request with respect to the
Securities of any particular series, such cash shall be applied on the next
succeeding sinking fund payment date to the redemption of Securities of such
series at the sinking fund redemption price together with accrued interest to
the date fixed for redemption. If such amount shall be $100,000 (or the Dollar
equivalent thereof as aforesaid) or less and the Company makes no such request
then it shall be carried over until a sum in excess of $100,000 (or the Dollar
equivalent thereof as aforesaid) is available. Not less than 30 days before each
such sinking fund payment date, the Trustee shall select the Securities to be
redeemed upon such sinking fund payment date in the manner specified in Section
3.03 and cause notice of the redemption thereof to be given in the name of and
at the expense of the Company in the manner provided in Section 3.04. Such
notice having been duly given, the redemption of such Securities shall be made
upon the terms and in the manner stated in Sections 3.05, 3.06 and 3.07.

                                   ARTICLE IV
                                    COVENANTS

SECTION 4.01 Payment of Securities.

                  The Company shall pay the principal of, premium (if any) and
interest on and any Additional Amounts with respect to the Securities of each
series on the dates and in the manner provided in the Securities of such series
and in this Indenture. Principal, premium, interest and any Additional Amounts
shall be considered paid on the date due if the Paying Agent, other than the
Company or a Subsidiary of the Company, holds on that date money deposited by
the Company designated for and sufficient to pay all principal, premium (if
any), interest and any Additional Amounts then due.

                  The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal and
premium (if any), at a rate equal to the then applicable interest rate on the
Securities to the extent lawful; and it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest and any Additional Amount (without regard to any
applicable grace period) at the same rate to the extent lawful.

SECTION 4.02 Maintenance of Office or Agency.

                  The Company will maintain in each Place of Payment for any
series of Securities an office or agency (which may be an office of the Trustee,
the Registrar or the Paying Agent) where Securities of that series may be
presented for registration of transfer or exchange, where Securities of that
series may be presented for payment and where notices and demands to or upon the
Company in respect of the Securities of that series and this Indenture may be
served. Unless otherwise designated by the Company by written notice to the
Trustee, such office or agency shall be the office of the Trustee in The City of
New York, which on the date hereof is located at Bank One, N.A. c/o First
Chicago Trust Company of New York, as agent, 14 Wall Street, 8th Floor, Suite
4607, New York, New York 10005. The Company will give prompt written notice to
the Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall

                                       24
<PAGE>   30

fail to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee.

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

SECTION 4.03 SEC Reports; Financial Statements.

                  (a) The Company shall file with the Trustee, within 15 days
after it files the same with the SEC, copies of the annual reports and the
information, documents and other reports (or copies of such portions of any of
the foregoing as the SEC may by rules and regulations prescribe) that the
Company is required to file with the SEC pursuant to Section 13 or 15(d) of the
Exchange Act. The Company shall also comply with the provisions of TIA Section
314(a).

                  (b) If the Company is not subject to the requirements of
Section 13 or 15(d) of the Exchange Act, the Company shall furnish to all
Holders of Rule 144A Securities and prospective purchasers of Rule 144A
Securities designated by the Holders of Rule 144A Securities, promptly upon
their request, the information required to be delivered pursuant to Rule
144A(d)(4) promulgated under the Securities Act of 1933, as amended.

SECTION 4.04 Compliance Certificate.

                  (a) The Company shall deliver to the Trustee, within 120 days
after the end of each fiscal year of the Company, a statement signed by an
Officer of the Company, which need not constitute an Officers' Certificate,
complying with TIA Section 314(a)(4) and stating that in the course of
performance by the signing Officer of the Company of his duties as such Officer
of the Company he would normally obtain knowledge of the keeping, observing,
performing and fulfilling by the Company of its obligations under this
Indenture, and further stating that to the best of his knowledge the Company has
kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions hereof (or, if a Default or Event of
Default shall have occurred, describing all such Defaults or Events of Default
of which such Officer may have knowledge and what action the Company is taking
or proposes to take with respect thereto).

                  (b) The Company shall, so long as Securities of any series are
outstanding, deliver to the Trustee, forthwith upon any Officer of the Company
becoming aware of any Default or Event of Default under this Indenture, an
Officers' Certificate specifying such Default or Event of Default and what
action the Company is taking or proposes to take with respect thereto.

                                       25
<PAGE>   31

SECTION 4.05 Corporate Existence.

                  Subject to Article V hereof, the Company shall do or cause to
be done all things necessary to preserve and keep in full force and effect its
corporate existence and the corporate existence of each of its Subsidiaries and
all rights (charter and statutory) and franchises of the Company and its
Subsidiaries, provided that the Company shall not be required to preserve the
corporate existence of any Subsidiary of the Company or any such right or
franchise if the Company shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Company and its
Subsidiaries taken as a whole and that the loss thereof would not have a
material adverse effect on the business, prospects, assets or financial
condition of the Company and its Subsidiaries taken as a whole and would not
have any material adverse effect on the payment and performance of the
obligations of the Company under the Securities and this Indenture.

SECTION 4.06 Waiver of Stay, Extension or Usury 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
or any usury law or other law that would prohibit or forgive the Company from
paying all or any portion of the principal of or interest on the Securities as
contemplated herein, wherever enacted, now or at any time hereafter in force, or
which may affect the covenants or the performance of this Indenture; and (to the
extent that it may lawfully do so) the Company hereby expressly waives all
benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.

SECTION 4.07 Additional Amounts.

                  If the Securities of a series expressly provide for the
payment of Additional Amounts, the Company will pay to the Holder of any
Security of such series Additional Amounts as expressly provided therein.
Whenever in this Indenture there is mentioned, in any context, the payment of
the principal of or any premium or interest on, or in respect of, any Security
of any series or the net proceeds received from the sale or exchange of any
Security of any series, such mention shall be deemed to include mention of the
payment of Additional Amounts provided for in this Section 4.07 to the extent
that, in such context, Additional Amounts are, were or would be payable in
respect thereof pursuant to the provisions of this Section 4.07 and express
mention of the payment of Additional Amounts (if applicable) in any provisions
hereof shall not be construed as excluding Additional Amounts in those
provisions hereof where such express mention is not made.

                  Unless otherwise provided pursuant to Section 2.01 with
respect to Securities of any series: If the Securities of a series provide for
the payment of Additional Amounts, at least ten days prior to the first Interest
Payment Date with respect to that series of Securities (or if the Securities of
that series will not bear interest prior to Maturity, the first day on which a
payment of principal and any premium is made), and at least ten days prior to
each date of payment of principal and any premium or interest if there has been
any change with respect to the matters set forth in the below-mentioned
Officers' Certificate, the Company shall furnish the Trustee and the Company's

                                       26
<PAGE>   32

principal Paying Agent or Paying Agents, if other than the Trustee, with an
Officers' Certificate instructing the Trustee and such Paying Agent or Paying
Agents whether such payment of principal of and any premium or interest on the
Securities of that series shall be made to Holders of Securities of that series
who are United States Aliens without withholding for or on account of any tax,
assessment or other governmental charge described in the Securities of that
series. If any such withholding shall be required, then such Officers'
Certificate shall specify by country the amount, if any, required to be withheld
on such payments to such Holders of Securities and the Company will pay to such
Paying Agent the Additional Amounts required by this Section. The Company
covenants to indemnify the Trustee and any Paying Agent for and to hold them
harmless against any loss, liability or expense reasonably incurred without
negligence or bad faith on their part arising out of or in connection with
actions taken or omitted by any of them in reliance on any Officers' Certificate
furnished pursuant to this Section 4.07.

SECTION 4.08 Limitation on Liens.

                  The Company shall not, and shall not permit any Principal
Domestic Subsidiary to, issue, assume or guarantee any Debt for borrowed money
secured by any Lien upon any Principal Property or any shares of stock or Debt
of any Principal Domestic Subsidiary (whether such Principal Property, shares of
stock or Debt is now owned or hereafter acquired) without making effective
provision whereby the Securities (together with, if the Company shall so
determine, any other Debt or other obligation of the Company or any Subsidiary)
shall be secured equally and ratably with (or, at the option of the Company,
prior to) the Debt so secured for so long as such Debt is so secured. The
foregoing restrictions will not, however, apply to Debt secured by Permitted
Liens.

                  In addition, the Company and its Principal Domestic
Subsidiaries may, without securing the Securities, issue, assume or guarantee
Debt that would otherwise be subject to the foregoing restrictions in an
aggregate principal amount that, together with all other such Debt of the
Company and its Principal Domestic Subsidiaries that would otherwise be subject
to the foregoing restrictions (not including Debt permitted to be secured under
the definition of Permitted Liens) and the aggregate amount of Attributable Debt
deemed outstanding with respect to Sale/Leaseback Transactions (reduced by the
amount applied pursuant to Section 4.09(b)) does not at any one time exceed 10%
of Consolidated Net Tangible Assets.

                  The following types of transactions shall not be deemed to
create "Debt" secured by "Liens" within the meaning of those terms as used in
this Indenture:

                  (a) the sale or other transfer of (i) oil, gas or other
         minerals in place for a period of time until, or in an amount such
         that, the purchaser will realize therefrom a specified amount of money
         (however determined) or a specified amount of such minerals, or (ii)
         any other interest in property of the character commonly referred to as
         a "production payment"; and

                  (b) the mortgage or pledge of any property of the Company or
         any Subsidiary in favor of the United States of America, or any State,
         or any department, agency,

                                       27
<PAGE>   33

         instrumentality or political subdivision of either, to secure partial,
         progress, advance or other payments pursuant to the provisions of any
         contract or statute.

SECTION 4.09 Limitation on Sale/Leaseback Transactions.

                  The Company shall not, and shall not permit any Principal
Domestic Subsidiary to, enter into any Sale/Leaseback Transaction with any
Person (other than the Company or a Subsidiary) unless:

                  (a) the Company or such Principal Domestic Subsidiary would be
         entitled to incur Debt in a principal amount equal to the Attributable
         Debt with respect to such Sale/Leaseback Transaction secured by a Lien
         on the property subject to such Sale/Leaseback Transaction pursuant to
         Section 4.08 without equally and ratably securing the Securities
         pursuant to such covenant; or

                  (b) within a period commencing six months prior to the
         consummation of such Sale/Leaseback Transaction and ending six months
         after the consummation thereof, the Company or any Subsidiary shall
         have applied an amount equal to all or a portion of the net proceeds of
         such Sale/Leaseback Transaction (with any such amount not being so
         applied to be subject to Section 4.09(a)):

                           (1) to the voluntary defeasance or retirement of any
                  Securities or any Funded Debt; or

                           (2) to the acquisition, exploration, drilling,
                  development, construction, improvement or expansion of one or
                  more Principal Properties.

                  For these purposes, the net proceeds of a Sale/Leaseback
Transaction means an amount equal to the greater of (i) the net proceeds of the
sale or transfer of the property leased in such Sale/Leaseback Transaction and
(ii) the fair value, as determined by the Board of Directors and evidenced by a
Board Resolution, of such property at the time of entering into such
Sale/Leaseback Transaction (in either case adjusted to reflect the remaining
term of the lease).

                                    ARTICLE V
                                   SUCCESSORS

SECTION 5.01 Limitations on Mergers and Consolidations.

                  The Company shall not, in any transaction or series of
transactions, consolidate with or merge into any Person, or sell, lease, convey,
transfer or otherwise dispose of all or substantially all of its assets to any
Person, unless:

                  (1) either (a) the Company shall be the continuing corporation
         or (b) the Person (if other than the Company) formed by such
         consolidation or into which the Company is merged, or to which such
         sale, lease, conveyance, transfer or other disposition shall be made

                                       28
<PAGE>   34

         (collectively, the "Successor"), is organized and validly existing
         under the laws of the United States, any political subdivision thereof
         or any State thereof or the District of Columbia, and expressly assumes
         by supplemental indenture the due and punctual payment of the principal
         of (and premium, if any) and interest on and Additional Amounts with
         respect to all the Securities and the performance of the Company's
         covenants and obligations under this Indenture and the Securities;

                  (2) immediately after giving effect to such transaction or
         series of transactions, no Default or Event of Default shall have
         occurred and be continuing or would result therefrom; and

                  (3) the Company delivers to the Trustee an Officers'
         Certificate and an Opinion of Counsel, each stating that the
         transaction and such supplemental indenture comply with this Indenture.

SECTION 5.02 Successor Person Substituted.

                  Upon any consolidation or merger of the Company or any sale,
lease, conveyance, transfer or other disposition of all or substantially all of
the assets of the Company in accordance with Section 5.01, the Successor formed
by such consolidation or into or with which the Company is merged or to which
such sale, lease, conveyance, transfer or other disposition is made shall
succeed to, and be substituted for, and may exercise every right and power of
the Company under this Indenture and the Securities with the same effect as if
such Successor had been named as the Company herein and the predecessor Company,
in the case of a sale, conveyance, transfer or other disposition, shall be
released from all obligations under this Indenture and the Securities.

                                   ARTICLE VI
                              DEFAULTS AND REMEDIES

SECTION 6.01 Events of Default.

                  Unless either inapplicable to a particular series or
specifically deleted or modified in or pursuant to the supplemental indenture or
Board Resolution establishing such series of Securities or in the form of
Security for such series, an "Event of Default," wherever used herein with
respect to Securities of any series, occurs if:

                           (1) the Company defaults in the payment of interest
         on or any Additional Amounts with respect to any Security of that
         series when the same becomes due and payable and such default continues
         for a period of 30 days;

                           (2) the Company defaults in the payment of (A) the
         principal of any Security of that series at its Maturity or (B) premium
         (if any) on any Security of that series when the same becomes due and
         payable;

                                       29
<PAGE>   35

                           (3) the Company defaults in the deposit of any
         sinking fund payment, when and as due by the terms of a Security of
         that series;

                           (4) the Company fails to comply with any of its other
         covenants or agreements in, or provisions of, the Securities of such
         series or this Indenture (other than an agreement, covenant or
         provision that has expressly been included in this Indenture solely for
         the benefit of one or more series of Securities other than that series)
         which shall not have been remedied within the specified period after
         written notice, as specified in the last paragraph of this Section
         6.01;

                           (5) the Company pursuant to or within the meaning of
         any Bankruptcy Law:

                           (A) commences a voluntary case,

                           (B) consents to the entry of an order for relief
                  against it in an involuntary case,

                           (C) consents to the appointment of a Bankruptcy
                  Custodian of it or for all or substantially all of its
                  property, or

                           (D) makes a general assignment for the benefit of its
                  creditors;

                           (6) a court of competent jurisdiction enters an order
         or decree under any Bankruptcy Law that remains unstayed and in effect
         for 90 days and that:

                           (A) is for relief against the Company as debtor in an
                  involuntary case,

                           (B) appoints a Bankruptcy Custodian of the Company or
                  a Bankruptcy Custodian for all or substantially all of the
                  property of the Company, or

                           (C) orders the liquidation of the Company; or

                           (7) any other Event of Default provided with respect
         to Securities of that series occurs.

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

                  The Trustee shall not be deemed to know or have notice of a
Default unless a Trust Officer at the Corporate Trust Office of the Trustee
receives written notice at the Corporate Trust Office of the Trustee of such
Default with specific reference to such Default.

                  When a Default is cured, it ceases.

                                       30
<PAGE>   36

                  Notwithstanding the foregoing provisions of this Section 6.01,
if the principal of, premium (if any) or interest on or Additional Amounts with
respect to any Security is payable in a currency or currencies (including a
composite currency) other than Dollars and such currency or currencies are not
available to the Company for making payment thereof due to the imposition of
exchange controls or other circumstances beyond the control of the Company (a
"Conversion Event"), the Company will be entitled to satisfy its obligations to
Holders of the Securities by making such payment in Dollars in an amount equal
to the Dollar equivalent of the amount payable in such other currency, as
determined by the Company by reference to the Exchange Rate on the date of such
payment, or, if such rate is not then available, on the basis of the most
recently available Exchange Rate. Notwithstanding the foregoing provisions of
this Section 6.01, any payment made under such circumstances in Dollars where
the required payment is in a currency other than Dollars will not constitute an
Event of Default under this Indenture.

                  Promptly after the occurrence of a Conversion Event, the
Company shall give written notice thereof to the Trustee; and the Trustee,
promptly after receipt of such notice, shall give notice thereof in the manner
provided in Section 10.02 to the Holders. Promptly after the making of any
payment in Dollars as a result of a Conversion Event, the Company shall give
notice in the manner provided in Section 10.02 to the Holders, setting forth the
applicable Exchange Rate and describing the calculation of such payments.

                  A Default under clause (4) or (7) of this Section 6.01 is not
an Event of Default until the Trustee notifies the Company, or the Holders of at
least 25% in principal amount of the then outstanding Securities of the series
affected by such Default (or, in the case of a Default under clause (4) of this
Section 6.01, if outstanding Securities of other series are affected by such
Default, then at least 25% in principal amount of the then outstanding
Securities so affected) notify the Company and the Trustee, of the Default, and
the Company fails to cure the Default within 90 days after receipt of the
notice. The notice must specify the Default, demand that it be remedied and
state that the notice is a "Notice of Default."

SECTION 6.02 Acceleration.

                  If an Event of Default with respect to any Securities of any
series at the time outstanding (other than an Event of Default specified in
clause (5) or (6) of Section 6.01) occurs and is continuing, the Trustee by
notice to the Company, or the Holders of at least 25% in principal amount of the
then outstanding Securities of the series affected by such default (or, in the
case of an Event of Default described in clause (4) of Section 6.01, if
outstanding Securities of other series are affected by such Default, then at
least 25% in principal amount of the then outstanding Securities so affected) by
notice to the Company and the Trustee, may declare the principal of (or, if any
such Securities are Original Issue Discount Securities, such portion of the
principal amount as may be specified in the terms of that series) and all
accrued and unpaid interest on all then outstanding Securities of such series or
of all series, as the case may be, to be due and payable. Upon any such
declaration the amounts due and payable on the Securities shall be due and
payable immediately. If an Event of Default specified in clause (5) or (6) of
Section 6.01 hereof occurs, such amounts shall ipso facto become and be
immediately due and payable without any declaration, notice or other act on the
part of the Trustee or any Holder. The Holders of a majority in principal amount
of the then

                                       31
<PAGE>   37

outstanding Securities of the series affected by such default or all series, as
the case may be, by written notice to the Trustee may rescind an acceleration
and its consequences (other than nonpayment of principal of or premium or
interest on or any Additional Amounts with respect to the Securities) if the
rescission would not conflict with any judgment or decree and if all existing
Events of Default with respect to Securities of that series (or of all series,
as the case may be) have been cured or waived, except nonpayment of principal,
premium, interest or any Additional Amounts that has become due solely because
of the acceleration.

SECTION 6.03 Other Remedies.

                  If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy to collect the payment of principal of, or
premium, if any, or interest on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.

                  The Trustee may maintain a proceeding even if it does not
possess any of the Securities or does not produce any of them in the proceeding.
A delay or omission by the Trustee or any Holder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.

SECTION 6.04 Waiver of Defaults.

                  Subject to Sections 6.07 and 9.02, the Holders of a majority
in principal amount of the then outstanding Securities of any series or of all
series (acting as one class) by notice to the Trustee may waive an existing or
past Default or Event of Default with respect to such series or all series, as
the case may be, and its consequences (including waivers obtained in connection
with a tender offer or exchange offer for Securities of such series or all
series or a solicitation of consents in respect of Securities of such series or
all series, provided that in each case such offer or solicitation is made to all
Holders of then outstanding Securities of such series or all series (but the
terms of such offer or solicitation may vary from series to series)), except (1)
a continuing Default or Event of Default in the payment of the principal of, or
premium, if any, or interest on or any Additional Amounts with respect to any
Security or (2) a continued Default in respect of a provision that under Section
9.02 cannot be amended or supplemented without the consent of each Holder
affected. Upon any such waiver, such Default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereon.

SECTION 6.05 Control by Majority.

                  With respect to Securities of any series, the Holders of a
majority in principal amount of the then outstanding Securities of such series
may direct in writing the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on it relating to or arising under an Event of Default described in
clause (1), (2), (3) or (7) of Section 6.01, and with respect to all Securities,
the Holders of a majority in principal amount of all the then outstanding
Securities affected may direct in writing the time, method and

                                       32
<PAGE>   38

place of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on it not relating to or arising under
such an Event of Default. However, the Trustee may refuse to follow any
direction that conflicts with applicable law or this Indenture, that the Trustee
determines may be unduly prejudicial to the rights of other Holders, or that may
involve the Trustee in personal liability; provided, however, that the Trustee
may take any other action deemed proper by the Trustee that is not inconsistent
with such direction. Prior to taking any action hereunder, the Trustee shall be
entitled to indemnification satisfactory to it in its sole discretion from
Holders directing the Trustee against all losses and expenses caused by taking
or not taking such action.

SECTION 6.06 Limitations on Suits.

                  Subject to Section 6.07 hereof, a Holder of a Security of any
series may pursue a remedy with respect to this Indenture or the Securities of
such series only if:

                  (1) the Holder gives to the Trustee written notice of a
         continuing Event of Default with respect to such series;

                  (2) the Holders of at least 25% in principal amount of the
         then outstanding Securities of such series make a written request to
         the Trustee to pursue the remedy;

                  (3) such Holder or Holders offer to the Trustee indemnity
         reasonably satisfactory to the Trustee against any loss, liability or
         expense;

                  (4) the Trustee does not comply with the request within 60
         days after receipt of the request and the offer of indemnity; and

                  (5) during such 60-day period the Holders of a majority in
         principal amount of the Securities of that series do not give the
         Trustee a direction inconsistent with the request.

                  A Holder may not use this Indenture to prejudice the rights of
another Holder or to obtain a preference or priority over another Holder.

SECTION 6.07 Rights of Holders to Receive Payment.

                  Notwithstanding any other provision of this Indenture, the
right of any Holder of a Security to receive payment of principal of and
premium, if any, and interest on and any Additional Amounts with respect to the
Security, on or after the respective due dates expressed in the Security, or to
bring suit for the enforcement of any such payment on or after such respective
dates, is absolute and unconditional and shall not be impaired or affected
without the consent of the Holder.

SECTION 6.08 Collection Suit by Trustee.

                  If an Event of Default specified in clause (1) or (2) of
Section 6.01 hereof occurs and is continuing, the Trustee is authorized to
recover judgment in its own name and as trustee of an

                                       33
<PAGE>   39

express trust against the Company for the amount of principal, premium (if any),
interest and any Additional Amounts remaining unpaid on the Securities of the
series affected by the Event of Default, and interest on overdue principal and
premium, if any, and, to the extent lawful, interest on overdue interest, and
such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.

SECTION 6.09 Trustee May File Proofs of Claim.

                  The Trustee is authorized to file such proofs of claim and
other papers or documents and to take such actions, including participating as a
member, voting or otherwise, of any committee of creditors, as may be necessary
or advisable to have the claims of the Trustee (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel) and the Holders allowed in any judicial proceedings
relative to the Company or its creditors or properties and shall be entitled and
empowered to collect, receive and distribute any money or other property payable
or deliverable on any such claims and any Bankruptcy Custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07. To the extent that the payment of any such compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.07 out of the estate in any such
proceeding, shall be denied for any reason, payment of the same shall be secured
by a lien on, and shall be paid out of, any and all distributions, dividends,
money, securities and other properties which the Holders of the Securities may
be entitled to receive in such proceeding whether in liquidation or under any
plan of reorganization or arrangement or otherwise. Nothing herein contained
shall be deemed to authorize the Trustee to authorize or consent to or accept or
adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Holder in any such proceeding.

SECTION 6.10 Priorities.

                  If the Trustee collects any money pursuant to this Article VI,
it shall pay out the money in the following order:

                  First: to the Trustee for amounts due under Section 7.07;

                  Second: to Holders for amounts due and unpaid on the
         Securities in respect of which or for the benefit of which such money
         has been collected, for principal, premium (if any), interest and any
         Additional Amounts ratably, without preference or priority of any kind,
         according to the amounts due and payable on such Securities for
         principal, premium (if any), interest and any Additional Amounts,
         respectively; and

                  Third: to the Company.

                                       34
<PAGE>   40

                  The Trustee, upon prior written notice to the Company, may fix
record dates and payment dates for any payment to Holders pursuant to this
Article VI.

                  To the fullest extent allowed under applicable law, if for the
purpose of obtaining a judgment against the Company in any court it is necessary
to convert the sum due in respect of the principal of, premium (if any) or
interest on or Additional Amounts with respect to the Securities of any series
(the "Required Currency") into a currency in which a judgment will be rendered
(the "Judgment Currency"), the rate of exchange used shall be the rate at which
in accordance with normal banking procedures the Trustee could purchase in The
City of New York the Required Currency with the Judgment Currency on the New
York Business Day next preceding that on which final judgment is given. Neither
the Company nor the Trustee shall be liable for any shortfall nor shall it
benefit from any windfall in payments to Holders of Securities under this
Section 6.10 caused by a change in exchange rates between the time the amount of
a judgment against it is calculated as above and the time the Trustee converts
the Judgment Currency into the Required Currency to make payments under this
Section to Holders of Securities, but payment of such judgment shall discharge
all amounts owed by the Company on the claim or claims underlying such judgment.

SECTION 6.11 Undertaking for Costs.

                  In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as a trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 6.07, or a suit by a Holder or Holders of more than
10% in principal amount of the then outstanding Securities of any series.

                                   ARTICLE VII
                                     TRUSTEE

SECTION 7.01 Duties of Trustee.

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

                  (b) Except during the continuance of an Event of Default with
respect to the Securities of any series:

                  (1) the Trustee need perform only those duties that are
         specifically set forth in this Indenture and no others, and no implied
         covenants or obligations shall be read into this Indenture against the
         Trustee; and

                                       35
<PAGE>   41

                  (2) in the absence of bad faith on its part, the Trustee may
         conclusively rely, as to the truth of the statements and the
         correctness of the opinions expressed therein, upon certificates or
         opinions furnished to the Trustee and conforming to the requirements of
         this Indenture. However, the Trustee shall examine such certificates
         and opinions to determine whether, on their face, they appear to
         conform to the requirements of this Indenture.

                  (c) The Trustee may not be relieved from liabilities for its
own negligent action, its own negligent failure to act or its own willful
misconduct, except that:

                  (1) this paragraph does not limit the effect of Section
         7.01(b);

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

                  (3) the Trustee shall not be liable with respect to any action
         it takes or omits to take in good faith in accordance with a direction
         received by it pursuant to Section 6.05.

                  (d) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
the provisions of this Section 7.01.

                  (e) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or incur any liability. The Trustee may refuse
to perform any duty or exercise any right or power unless it receives indemnity
reasonably satisfactory to it against any loss, liability or expense.

                  (f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law. All money received by the Trustee shall,
until applied as herein provided, be held in trust for the payment of the
principal of, premium (if any) and interest on and Additional Amounts with
respect to the Securities.

SECTION 7.02 Rights of Trustee.

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

                  (b) Before the Trustee acts or refrains from acting, it may
require instruction, an Officers' Certificate or an Opinion of Counsel or both
to be provided. The Trustee shall not be liable for any action it takes or omits
to take in good faith in reliance on such instruction, Officers' Certificate or
Opinion of Counsel. The Trustee may consult at the Company's expense with
counsel and the written advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon.

                                       36
<PAGE>   42

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

                  (d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers conferred upon it by this Indenture.

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

SECTION 7.03 May Hold Securities.

                  The Trustee in its individual or any other capacity may become
the owner or pledgee of Securities and may otherwise deal with the Company or
any of its Affiliates with the same rights it would have if it were not Trustee.
Any Agent may do the same with like rights and duties. However, the Trustee is
subject to Sections 7.10 and 7.11.

SECTION 7.04 Trustee's Disclaimer.

                  The Trustee makes no representation as to the validity or
adequacy of this Indenture or the Securities, it shall not be accountable for
the Company's use of the proceeds from the Securities or any money paid to the
Company or upon the Company's direction under any provision hereof, it shall not
be responsible for the use or application of any money received by any Paying
Agent other than the Trustee and it shall not be responsible for any statement
or recital herein or any statement in the Securities other than its certificate
of authentication.

SECTION 7.05 Notice of Defaults.

                  If a Default or Event of Default with respect to the
Securities of any series occurs and is continuing and it is known to the
Trustee, the Trustee shall mail to Holders of Securities of such series a notice
of the Default or Event of Default within 90 days after it occurs. Except in the
case of a Default or Event of Default in payment of principal of, premium (if
any) and interest on and Additional Amounts or any sinking fund installment with
respect to the Securities of such series, the Trustee may withhold the notice if
and so long as a committee of its Trust Officers in good faith determines that
withholding the notice is in the interests of Holders of Securities of such
series.

SECTION 7.06 Reports by Trustee to Holders.

                  Within 60 days after each May 15 of each year after the
execution of this Indenture, the Trustee shall mail to Holders of a series and
the Company a brief report dated as of such reporting date that complies with
TIA Section 313(a); provided, however, that if no event described in TIA Section
313(a) has occurred within the twelve months preceding the reporting date with
respect to a series, no report need be transmitted to Holders of such series.
The Trustee also shall comply with TIA Section 313(b). The Trustee shall also
transmit by mail all reports if and as required by TIA Sections 313(c) and
313(d).

                                       37
<PAGE>   43

                  A copy of each report at the time of its mailing to Holders of
a series of Securities shall be filed by the Company with the SEC and each
securities exchange, if any, on which the Securities of such series are listed.
The Company shall notify the Trustee if and when any series of Securities is
listed on any stock exchange.

SECTION 7.07 Compensation and Indemnity.

                  The Company agrees to pay to the Trustee for its acceptance of
this Indenture and services hereunder such compensation as the Company and the
Trustee shall from time to time agree in writing. The Trustee's compensation
shall not be limited by any law on compensation of a trustee of an express
trust. The Company agrees to reimburse the Trustee upon request for all
reasonable disbursements, advances and expenses incurred by it. Such expenses
shall include the reasonable compensation, disbursements and expenses of the
Trustee's agents and counsel.

                  The Company hereby indemnifies the Trustee against any loss,
liability or expense incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture, except as set
forth in the next paragraph. The Trustee shall notify the Company promptly of
any claim for which it may seek indemnity. The Company shall defend the claim
and the Trustee shall cooperate in the defense. The Trustee may have separate
counsel and the Company shall pay the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made without its consent.

                  The Company shall not be obligated to reimburse any expense or
indemnify against any loss or liability incurred by the Trustee through
negligence or bad faith.

                  To secure the payment obligations of the Company in this
Section 7.07, the Trustee shall have a lien prior to the Securities on all money
or property held or collected by the Trustee, except that held in trust to pay
principal of, premium (if any) and interest on and any Additional Amounts with
respect to Securities of series. Such lien and the indemnity obligation under
this Section 7.07 shall survive the satisfaction and discharge of this
Indenture.

                  When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(5) or (6) occurs, the expenses and
the compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.

SECTION 7.08 Replacement of Trustee.

                  A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 7.08.

                  The Trustee may resign and be discharged at any time with
respect to the Securities of one or more series by so notifying the Company. The
Holders of a majority in principal amount of the then outstanding Securities of
any series may remove the Trustee with respect to the Securities

                                       38
<PAGE>   44

of such series by so notifying the Trustee and the Company. The Company may
remove the Trustee if:

                  (1) the Trustee fails to comply with Section 7.10;

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

                  (3) a Bankruptcy Custodian or public officer takes charge of
         the Trustee or its property; or

                  (4) the Trustee otherwise becomes incapable of acting.

                  If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, with respect to the Securities of one or
more series, the Company shall promptly appoint a successor Trustee or Trustees
with respect to the Securities of that or those series (it being understood that
any such successor Trustee may be appointed with respect to the Securities of
one or more or all of such series and that at any time there shall be only one
Trustee with respect to the Securities of any particular series). Within one
year after the successor Trustee with respect to the Securities of any series
takes office, the Holders of a majority in principal amount of the Securities of
such series may appoint a successor Trustee to replace the successor Trustee
appointed by the Company.

                  If a successor Trustee with respect to the Securities of any
series does not take office within 60 days after the retiring Trustee resigns or
is removed, the retiring Trustee, the Company or the Holders of at least 10% in
principal amount of the then outstanding Securities of such series may petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Securities of such series.

                  If the Trustee with respect to the Securities of a series
fails to comply with Section 7.10, any Holder of Securities of such series may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee with respect to the Securities of such
series.

                  In case of the appointment of a successor Trustee with respect
to all Securities, each such successor Trustee shall deliver a written
acceptance of its appointment to the retiring Trustee and to the Company.
Thereupon the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have all the rights, powers and
duties of the retiring Trustee under this Indenture. The successor Trustee shall
mail a notice of its succession to Holders. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, subject to
the lien provided for in Section 7.07.

                  In case of the appointment of a successor Trustee with respect
to the Securities of one or more (but not all) series, the Company, the retiring
Trustee and each successor Trustee with respect to the Securities of one or more
(but not all) series shall execute and deliver an indenture

                                       39
<PAGE>   45

supplemental hereto in which each successor Trustee shall accept such
appointment and that (1) shall confer to each successor Trustee all the rights,
powers and duties of the retiring Trustee with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates, (2)
if the retiring Trustee is not retiring with respect to all Securities, shall
confirm that all the rights, powers and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee. Nothing herein or in such supplemental
indenture shall constitute such Trustees co-trustees of the same trust, and each
such Trustee shall be trustee of a trust or trusts hereunder separate and apart
from any trust or trusts hereunder administered by any other such Trustee. Upon
the execution and delivery of such supplemental indenture, the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein and each such successor Trustee shall have all the rights, powers and
duties of the retiring Trustee with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates. On request of
the Company or any successor Trustee, such retiring Trustee shall transfer to
such successor Trustee all property held by such retiring Trustee as Trustee
with respect to the Securities of that or those series to which the appointment
of such successor Trustee relates. Such retiring Trustee shall, however, have
the right to deduct its unpaid fees and expenses, including attorneys' fees.

                  Notwithstanding replacement of the Trustee or Trustees
pursuant to this Section 7.08, the obligations of the Company under Section 7.07
shall continue for the benefit of the retiring Trustee or Trustees.

SECTION 7.09 Successor Trustee by Merger, etc.

                  Subject to Section 7.10, if the Trustee consolidates, merges
or converts into, or transfers all or substantially all of its corporate trust
business to, another corporation, the successor corporation without any further
act shall be the successor Trustee; provided, however, that in the case of a
transfer of all or substantially all of its corporate trust business to another
corporation, the transferee corporation expressly assumes all of the Trustee's
liabilities hereunder.

                  In case any Securities shall have been authenticated, but not
delivered, by the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such authentication and
deliver the Securities so authenticated; and in case at that time any of the
Securities shall not have been authenticated, any successor to the Trustee may
authenticate such Securities either in the name of any predecessor hereunder or
in the name of the successor to the Trustee; and in all such cases such
certificates shall have the full force which it is anywhere in the Securities or
in this Indenture provided that the certificate of the Trustee shall have.

SECTION 7.10 Eligibility; Disqualification.

                  There shall at all times be a Trustee hereunder which shall be
a corporation organized and doing business under the laws of the United States,
any State thereof or the District of Columbia and authorized under such laws to
exercise corporate trust power, shall be subject to supervision or

                                       40
<PAGE>   46

examination by Federal or State (or the District of Columbia) authority and
shall have, or be a Subsidiary of a bank or bank holding company having, a
combined capital and surplus of at least $50 million as set forth in its most
recent published annual report of condition.

                  The Indenture shall always have a Trustee who satisfies the
requirements of TIA Sections 310(a)(1), 310(a)(2) and 310(a)(5). The Trustee is
subject to and shall comply with the provisions of TIA Section 310(b) during the
period of time required by this Indenture. Nothing in this Indenture shall
prevent the Trustee from filing with the SEC the application referred to in the
penultimate paragraph of TIA Section 310(b).

SECTION 7.11 Preferential Collection of Claims Against Company.

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

                                  ARTICLE VIII
                             DISCHARGE OF INDENTURE

SECTION 8.01 Termination of Company's Obligations.

                  (a) This Indenture shall cease to be of further effect with
respect to the Securities of a series (except that the Company's obligations
under Section 7.07, the Trustee's and Paying Agent's obligations under Section
8.03 and the rights, powers, protections and privileges accorded the Trustee
under Article VII shall survive), and the Trustee, on demand of the Company,
shall execute proper instruments acknowledging the satisfaction and discharge of
this Indenture with respect to the Securities of such series, when:

                  (1) either

                           (A) all outstanding Securities of such series
                  theretofore authenticated and issued (other than destroyed,
                  lost or stolen Securities that have been replaced or paid)
                  have been delivered to the Trustee for cancellation; or

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

                                    (i)      have become due and payable, or

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

                                    (iii)    are to be called for redemption
                                             within one year under arrangements
                                             satisfactory to the Trustee for the
                                             giving of

                                       41
<PAGE>   47

                                             notice of redemption by the Trustee
                                             in the name, and at the expense, of
                                             the Company,

                  and, in the case of clause (i), (ii) or (iii) above, the
                  Company has irrevocably deposited or caused to be deposited
                  with the Trustee as funds (immediately available to the
                  Holders in the case of clause (i)) in trust for such purpose
                  (x) cash in an amount, or (y) Government Obligations, maturing
                  as to principal and interest at such times and in such amounts
                  as will ensure the availability of cash in an amount or (z) a
                  combination thereof, which will be sufficient, in the opinion
                  of a nationally recognized firm of independent public
                  accountants expressed in a written certification thereof
                  delivered to the Trustee, to pay and discharge the entire
                  indebtedness on the Securities of such series for principal
                  and interest to the date of such deposit (in the case of
                  Securities which have become due and payable) or for
                  principal, premium, if any, and interest to the Stated
                  Maturity or Redemption Date, as the case may be; or

                           (C) the Company has properly fulfilled such other
                  means of satisfaction and discharge as is specified, as
                  contemplated by Section 2.01, to be applicable to the
                  Securities of such series;

                  (2) the Company has paid or caused to be paid all other sums
         payable by it hereunder with respect to the Securities of such series;
         and

                  (3) the Company has delivered to the Trustee an Officers'
         Certificate stating that all conditions precedent to satisfaction and
         discharge of this Indenture with respect to the Securities of such
         series have been complied with, together with an Opinion of Counsel to
         the same effect.

                  (b) Unless this Section 8.01(b) is specified as not being
applicable to Securities of a series as contemplated by Section 2.01, the
Company may terminate certain of its obligations under this Indenture ("covenant
defeasance") with respect to the Securities of a series if:

                  (1) the Company has irrevocably deposited or caused to be
         irrevocably deposited with the Trustee as trust funds in trust for the
         purpose of making the following payments, specifically pledged as
         security for and dedicated solely to the benefit of the Holders of
         Securities of such series, (i) money in the currency in which payment
         of the Securities of such series is to be made in an amount, or (ii)
         Government Obligations with respect to such series, maturing as to
         principal and interest at such times and in such amounts as will ensure
         the availability of money in the currency in which payment of the
         Securities of such series is to be made in an amount or (iii) a
         combination thereof, that is sufficient, in the opinion (in the case of
         (ii) and (iii)) of a nationally recognized firm of independent public
         accountants expressed in a written certification thereof delivered to
         the Trustee, to pay, without consideration of the reinvestment of any
         such amounts and after payment of all taxes or other charges or
         assessments in respect thereof payable by the Trustee, the principal of
         and premium (if any) and interest on all Securities of such series on
         each date that such principal,

                                       42
<PAGE>   48

         premium (if any) or interest is due and payable and (at the Stated
         Maturity thereof or upon redemption as provided in Section 8.01(e)) to
         pay all other sums payable by it hereunder; provided that the Trustee
         shall have been irrevocably instructed to apply such money and/or the
         proceeds of such Government Obligations to the payment of said
         principal, premium (if any) and interest with respect to the Securities
         of such series as the same shall become due;

                  (2) the Company has delivered to the Trustee an Officers'
         Certificate stating that all conditions precedent to satisfaction and
         discharge of this Indenture with respect to the Securities of such
         series have been complied with, and an Opinion of Counsel to the same
         effect;

                  (3) no Default or Event of Default with respect to the
         Securities of such series shall have occurred and be continuing on the
         date of such deposit;

                  (4) the Company shall have delivered to the Trustee an Opinion
         of Counsel from a nationally recognized counsel acceptable to the
         Trustee or a tax ruling to the effect that the Holders will not
         recognize income, gain or loss for Federal income tax purposes as a
         result of the Company's exercise of its option under this Section
         8.01(b) and will be subject to Federal income tax on the same amount
         and in the same manner and at the same times as would have been the
         case if such option had not been exercised;

                  (5) the Company has complied with any additional conditions
         specified pursuant to Section 2.01 to be applicable to the discharge of
         Securities of such series pursuant to this Section 8.01; and

                  (6) such deposit and discharge shall not cause the Trustee to
         have a conflicting interest as defined in TIA Section 310(b).

                  In such event, this Indenture shall cease to be of further
effect (except as set forth in this paragraph), and the Trustee, on demand of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge under this Indenture. However, the Company's obligations in Sections
2.05, 2.06, 2.07, 2.08, 2.09, 4.01, 4.02, 5.01, 7.07, 7.08 and 8.04, the
Trustee's and Paying Agent's obligations in Section 8.03 and the rights, powers,
protections and privileges accorded the Trustee under Article VII shall survive
until all Securities of such series are no longer outstanding. Thereafter, only
the Company's obligations in Section 7.07 and the Trustee's and Paying Agent's
obligations in Section 8.03 shall survive with respect to Securities of such
series.

                  After such irrevocable deposit made pursuant to this Section
8.01(b) and satisfaction of the other conditions set forth herein, the Trustee
upon request shall acknowledge in writing the discharge of the Company's
obligations under this Indenture with respect to the Securities of such series
except for those surviving obligations specified above.

                  In order to have money available on a payment date to pay
principal of or premium (if any) or interest on the Securities, the Government
Obligations shall be payable as to principal or

                                       43
<PAGE>   49

interest on or before such payment date in such amounts as will provide the
necessary money. Government Obligations shall not be callable at the issuer's
option.

                  (c) If the Company has previously complied or is concurrently
complying with Section 8.01(b) (other than any additional conditions specified
pursuant to Section 2.01 that are expressly applicable only to covenant
defeasance) with respect to Securities of a series, then, unless this Section
8.01(c) is specified as not being applicable to Securities of such series as
contemplated by Section 2.01, the Company may elect to be discharged ("legal
defeasance") from its obligations to make payments with respect to Securities of
such series, if:

                  (1) no Default or Event of Default under clauses (5) and (6)
         of Section 6.01 hereof shall have occurred at any time during the
         period ending on the 91st day after the date of deposit contemplated by
         Section 8.01(b) (it being understood that this condition shall not be
         deemed satisfied until the expiration of such period);

                  (2) unless otherwise specified with respect to Securities of
         such series as contemplated by Section 2.01, the Company has delivered
         to the Trustee an Opinion of Counsel from a nationally recognized
         counsel acceptable to the Trustee to the effect referred to in Section
         8.01(b)(4) with respect to such legal defeasance, which opinion is
         based on (i) a private ruling of the Internal Revenue Service addressed
         to the Company, (ii) a published ruling of the Internal Revenue Service
         or (iii) a change in the applicable federal income tax law (including
         regulations) after the date of this Indenture;

                  (3) the Company has complied with any other conditions
         specified pursuant to Section 2.01 to be applicable to the legal
         defeasance of Securities of such series pursuant to this Section
         8.01(c); and

                  (4) the Company has delivered to the Trustee a Company Request
         requesting such legal defeasance of the Securities of such series and
         an Officers' Certificate stating that all conditions precedent with
         respect to such legal defeasance of the Securities of such series have
         been complied with, together with an Opinion of Counsel to the same
         effect.

                  In such event, the Company will be discharged from its
obligations under this Indenture and the Securities of such series to pay
principal of, premium (if any) and interest on, and any Additional Amounts with
respect to, Securities of such series, the Company's obligations under Sections
4.01, 4.02 and 5.01 shall terminate with respect to such Securities, and the
entire indebtedness of the Company evidenced by such Securities shall be deemed
paid and discharged.

                  (d) If and to the extent additional or alternative means of
satisfaction, discharge or defeasance of Securities of a series are specified to
be applicable to such series as contemplated by Section 2.01, the Company may
terminate any or all of its obligations under this Indenture with respect to
Securities of a series and any or all of its obligations under the Securities of
such series if it fulfills such other means of satisfaction and discharge as may
be so specified, as contemplated by Section 2.01, to be applicable to the
Securities of such series.

                                       44
<PAGE>   50

                  (e) If Securities of any series subject to subsections (a),
(b), (c) or (d) of this Section 8.01 are to be redeemed prior to their Stated
Maturity, whether pursuant to any optional redemption provisions or in
accordance with any mandatory or optional sinking fund provisions, the terms of
the applicable trust arrangement shall provide for such redemption, and the
Company shall make such arrangements as are reasonably satisfactory to the
Trustee for the giving of notice of redemption by the Trustee in the name, and
at the expense, of the Company.

SECTION 8.02 Application of Trust Money.

                  The Trustee or a trustee satisfactory to the Trustee and the
Company shall hold in trust money or Government Obligations deposited with it
pursuant to Section 8.01 hereof. It shall apply the deposited money and the
money from Government Obligations through the Paying Agent and in accordance
with this Indenture to the payment of principal of, premium (if any) and
interest on and any Additional Amounts with respect to the Securities of the
series with respect to which the deposit was made.

SECTION 8.03 Repayment to Company.

                  The Trustee and the Paying Agent shall promptly pay to the
Company upon written request any excess money or Government Obligations (or
proceeds therefrom) held by them at any time upon the written request of the
Company.

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

SECTION 8.04 Reinstatement.

                  If the Trustee or the Paying Agent is unable to apply any
money or Government Obligations deposited with respect to Securities of any
series in accordance with Section 8.01 by reason of any legal proceeding or by
reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, the
obligations of the Company under this Indenture with respect to the Securities
of such series and under the Securities of such series shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.01 until such
time as the Trustee or the Paying Agent is permitted to apply all such money or
Government Obligations in accordance with Section 8.01; provided, however, that
if the Company has made any payment of principal of, premium (if any) or
interest on or any Additional Amounts with respect to any Securities because of
the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Securities to receive such payment from the money
or Government Obligations held by the Trustee or the Paying Agent.

                                       45
<PAGE>   51

                                   ARTICLE IX
                     SUPPLEMENTAL INDENTURES AND AMENDMENTS

SECTION 9.01 Without Consent of Holders.

                  The Company and the Trustee may amend or supplement this
Indenture or the Securities or waive any provision hereof or thereof without the
consent of any Holder:

                  (1) to cure any ambiguity, omission, defect or inconsistency;

                  (2) to comply with Section 5.01;

                  (3) to provide for uncertificated Securities in addition to or
         in place of certificated Securities, or to provide for the issuance of
         bearer Securities (with or without coupons);

                  (4) to provide any security for any series of Securities or to
         add guarantees of any series of Securities;

                  (5) to comply with any requirement in order to effect or
         maintain the qualification of this Indenture under the TIA;

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

                  (7) to add any additional Events of Default with respect to
         all or any series of the Securities (and, if such Events of Default are
         applicable to less than all series of Securities, specifying the series
         to which such Events of Default are applicable);

                  (8) to change or eliminate any of the provisions of this
         Indenture; provided that any such change or elimination shall become
         effective only when there is no outstanding Security of any series
         created prior to the execution of such amendment or supplemental
         indenture that is adversely affected in any material respect by such
         change in or elimination of such provision;

                  (9) to establish the form or terms of Securities of any series
         as permitted by Section 2.01;

                  (10) to supplement any of the provisions of this Indenture to
         such extent as shall be necessary to permit or facilitate the
         defeasance and discharge of any series of Securities pursuant to
         Section 8.01; provided, however, that any such action shall not
         adversely affect the interest of the Holders of Securities of such
         series or any other series of Securities in any material respect; or

                                       46
<PAGE>   52

                  (11) to evidence and provide for the acceptance of appointment
         hereunder by a successor Trustee with respect to the Securities of one
         or more series and to add to or change any of the provisions of this
         Indenture as shall be necessary to provide for or facilitate the
         administration of the trusts hereunder by more than one Trustee,
         pursuant to the requirements of Section 7.08.

                  Upon the request of the Company, accompanied by a Board
Resolution, and upon receipt by the Trustee of the documents described in
Section 9.06, the Trustee shall, subject to Section 9.06, join with the Company
in the execution of any supplemental indenture authorized or permitted by the
terms of this Indenture and make any further appropriate agreements and
stipulations that may be therein contained.

SECTION 9.02 With Consent of Holders.

                  Except as provided below in this Section 9.02, the Company and
the Trustee may amend or supplement this Indenture with the written consent
(including consents obtained in connection with a tender offer or exchange offer
for Securities of any one or more series or all series or a solicitation of
consents in respect of Securities of any one or more series or all series,
provided that in each case such offer or solicitation is made to all Holders of
then outstanding Securities of each such series (but the terms of such offer or
solicitation may vary from series to series)) of the Holders of at least a
majority in principal amount of the then outstanding Securities of all series
affected by such amendment or supplement (acting as one class).

                  Upon the request of the Company, accompanied by a Board
Resolution, and upon the filing with the Trustee of evidence of the consent of
the Holders as aforesaid, and upon receipt by the Trustee of the documents
described in Section 9.06, the Trustee shall, subject to Section 9.06, join with
the Company in the execution of such amendment or supplemental indenture.

                  It shall not be necessary for the consent of the Holders under
this Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.

                  The Holders of a majority in principal amount of the then
outstanding Securities of one or more series or of all series may waive
compliance in a particular instance by the Company with any provision of this
Indenture with respect to Securities of such series (including waivers obtained
in connection with a tender offer or exchange offer for Securities of such
series or a solicitation of consents in respect of Securities of such series,
provided that in each case such offer or solicitation is made to all Holders of
then outstanding Securities of such series (but the terms of such offer or
solicitation may vary from series to series)).

                  However, without the consent of each Holder affected, an
amendment, supplement or waiver under this Section 9.02 may not:

                                       47
<PAGE>   53

                  (1) reduce the amount of Securities whose Holders must consent
         to an amendment, supplement or waiver;

                  (2) reduce the rate of or change the time for payment of
         interest, including default interest, on any Security;

                  (3) reduce the principal of, premium on or any mandatory
         sinking fund payment with respect to, or change the Stated Maturity of,
         any Security or reduce the amount of the principal of an Original Issue
         Discount Security that would be due and payable upon a declaration of
         acceleration of the Maturity thereof pursuant to Section 6.02;

                  (4) reduce the premium, if any, payable upon the redemption of
         any Security or change the time at which any Security may or shall be
         redeemed;

                  (5) change any obligation of the Company to pay Additional
         Amounts with respect to any Security;

                  (6) change the coin or currency or currencies (including
         composite currencies) in which any Security or any premium, interest or
         Additional Amounts with respect thereto are payable;

                  (7) impair the right to institute suit for the enforcement of
         any payment of principal of, premium (if any) or interest on or any
         Additional Amounts with respect to any Security pursuant to Sections
         6.07 and 6.08, except as limited by Section 6.06;

                  (8) make any change in the percentage of principal amount of
         Securities necessary to waive compliance with certain provisions of
         this Indenture pursuant to Section 6.04 or 6.07 or make any change in
         this sentence of Section 9.02; or

                  (9) waive a continuing Default or Event of Default in the
         payment of principal of, premium (if any) or interest on or Additional
         Amounts with respect to the Securities.

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

                  The right of any Holder to participate in any consent required
or sought pursuant to any provision of this Indenture (and the obligation of the
Company to obtain any such consent otherwise required from such Holder) may be
subject to the requirement that such Holder shall have been the Holder of record
of any Securities with respect to which such consent is required or sought as of
a date identified by the Company in a notice furnished to Holders in accordance
with the terms of this Indenture.

                                       48
<PAGE>   54

                  After an amendment, supplement or waiver under this Section
9.02 becomes effective, the Company shall mail to the Holders of each Security
affected thereby a notice briefly describing the amendment, supplement or
waiver. Any failure of the Company to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such
amendment, supplement or waiver.

SECTION 9.03 Compliance with Trust Indenture Act.

                  Every amendment or supplement to this Indenture or the
Securities shall comply in form and substance with the TIA as then in effect.

SECTION 9.04 Revocation and Effect of Consents.

                  Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder is a continuing consent by the Holder and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security, even if notation of the consent is not
made on any Security. However, any such Holder or subsequent Holder may revoke
the consent as to his or her Security or portion of a Security if the Trustee
receives written notice of revocation before the date the amendment, supplement
or waiver becomes effective. An amendment, supplement or waiver becomes
effective in accordance with its terms and thereafter binds every Holder.

                  The Company may, but shall not be obligated to, fix a record
date (which need not comply with Section 316(c) of the TIA) for the purpose of
determining the Holders entitled to consent to any amendment, supplement or
waiver or to take any other action under this Indenture. If a record date is
fixed, then notwithstanding the provisions of the immediately preceding
paragraph, those Persons who were Holders at such record date (or their duly
designated proxies), and only those Persons, shall be entitled to consent to
such amendment, supplement or waiver or to revoke any consent previously given,
whether or not such Persons continue to be Holders after such record date. No
consent shall be valid or effective for more than 90 days after such record date
unless consents from Holders of the principal amount of Securities required
hereunder for such amendment or waiver to be effective shall have also been
given and not revoked within such 90-day period.

                  After an amendment, supplement or waiver becomes effective, it
shall bind every Holder, unless it is of the type described in any of clauses
(1) through (9) of Section 9.02 hereof. In such case, the amendment, supplement
or waiver shall bind each Holder who has consented to it and every subsequent
Holder that evidences the same debt as the consenting Holder's Security.

SECTION 9.05 Notation on or Exchange of Securities.

                  If an amendment or supplement changes the terms of an
outstanding Security, the Company may require the Holder of the Security to
deliver it to the Trustee. The Trustee may place an appropriate notation on the
Security at the request of the Company regarding the changed terms and return it
to the Holder. Alternatively, if the Company so determines, the Company in
exchange

                                       49
<PAGE>   55

for the Security shall issue and the Trustee shall authenticate a new Security
that reflects the changed terms. Failure to make the appropriate notation or to
issue a new Security shall not affect the validity of such amendment or
supplement.

                  Securities of any series authenticated and delivered after the
execution of any amendment or supplement may, and shall if required by the
Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such amendment or supplement.

SECTION 9.06 Trustee to Sign Amendments, etc.

                  The Trustee shall sign any amendment or supplement authorized
pursuant to this Article if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. If it does,
the Trustee may, but need not, sign it. In signing or refusing to sign such
amendment or supplement, the Trustee shall be entitled to receive, and, subject
to Section 7.01 hereof, shall be fully protected in relying upon, an Opinion of
Counsel provided at the expense of the Company as conclusive evidence that such
amendment or supplement is authorized or permitted by this Indenture, that it is
not inconsistent herewith, and that it will be valid and binding upon the
Company in accordance with its terms.

                                    ARTICLE X
                                  MISCELLANEOUS

SECTION 10.01 Trust Indenture Act Controls.

                  If any provision of this Indenture limits, qualifies or
conflicts with the duties imposed by operation of TIA Section 318(c), the
imposed duties shall control.

SECTION 10.02 Notices.

                  Any notice or communication by the Company or the Trustee to
the other is duly given if in writing and delivered in person or mailed by
first-class mail (registered or certified, return receipt requested), telex,
facsimile or overnight air courier guaranteeing next day delivery, to the
other's address:

                  If to the Company:

                  Conoco Inc.
                  600 North Dairy Ashford
                  Houston, Texas 77079
                  Facsimile: (281) 293-1600

                                       50
<PAGE>   56

                  If to the Trustee:

                  Bank One, N.A.
                  100 East Broad Street, 8th Floor
                  Columbus, Ohio 43215
                  Attn: Corporate Trust Department OH-0181
                  Facsimile: (614) 248-5195

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

                  All notices and communications shall be deemed to have been
duly given: at the time delivered by hand, if personally delivered; five
Business Days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt acknowledged, if by facsimile; and
the next Business Day after timely delivery to the courier, if sent by overnight
air courier guaranteeing next day delivery.

                  Any notice or communication to a Holder shall be mailed by
first-class mail, postage prepaid, to the Holder's address shown on the register
kept by the Registrar. Failure to mail a notice or communication to a Holder or
any defect in it shall not affect its sufficiency with respect to other Holders.

                  If a notice or communication is mailed in the manner provided
above within the time prescribed, it is duly given, whether or not the addressee
receives it, except in the case of notice to the Trustee, it is duly given only
when received.

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

                  All notices or communications, including without limitation
notices to the Trustee or the Company by Holders, shall be in writing, except as
otherwise set forth herein.

                  In case by reason of the suspension of regular mail service,
or by reason of any other cause, it shall be impossible to mail any notice
required by this Indenture, then such method of notification as shall be made
with the approval of the Trustee shall constitute a sufficient mailing of such
notice.

SECTION 10.03 Communication by Holders with Other Holders.

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

                                       51
<PAGE>   57

SECTION 10.04 Certificate and Opinion as to Conditions Precedent.

                  Upon any request or application by the Company to the Trustee
to take any action under this Indenture, the Company shall, if requested by the
Trustee, furnish to the Trustee at the expense of the Company:

                  (1) an Officers' Certificate (which shall include the
         statements set forth in Section 10.05) stating that, in the opinion of
         the signers, all conditions precedent and covenants, if any, provided
         for in this Indenture relating to the proposed action have been
         complied with; and

                  (2) an Opinion of Counsel (which shall include the statements
         set forth in Section 10.05 hereof) stating that, in the opinion of such
         counsel, all such conditions precedent and covenants have been complied
         with.

SECTION 10.05 Statements Required in Certificate or Opinion.

                  Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA Section 314(a)(4)) shall comply with the provisions of
TIA Section 314(e) and shall include:

                  (1) a statement that the Person making such certificate or
         opinion has read such covenant or condition;

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

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

                  (4) a statement as to whether or not, in the opinion of such
         Person, such condition or covenant has been complied with.

SECTION 10.06 Rules by Trustee and Agents.

                  The Trustee may make reasonable rules for action by or at a
meeting of Holders. The Registrar or the Paying Agent may make reasonable rules
and set reasonable requirements for its functions.

                                       52
<PAGE>   58

SECTION 10.07 Legal Holidays.

                  If a payment date is a Legal Holiday at a Place of Payment,
payment may be made at that place on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period.

SECTION 10.08 No Recourse Against Others.

                  A director, officer, employee, stockholder, partner or other
owner of the Company or the Trustee, as such, shall not have any liability for
any obligations of the Company under the Securities or for any obligations of
the Company or the Trustee under this Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. Each Holder by
accepting a Security waives and releases all such liability. The waiver and
release shall be part of the consideration for the issue of Securities.

SECTION 10.09 Governing Law.

                  THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING
EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS TO THE EXTENT THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

SECTION 10.10 No Adverse Interpretation of Other Agreements.

                  This Indenture may not be used to interpret another indenture,
loan or debt agreement of the Company or any other Subsidiary of the Company.
Any such indenture, loan or debt agreement may not be used to interpret this
Indenture.

SECTION 10.11 Successors.

                  All agreements of the Company in this Indenture and the
Securities shall bind its successors. All agreements of the Trustee in this
Indenture shall bind its successors.

SECTION 10.12 Severability.

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

SECTION 10.13 Counterpart Originals.

                  The parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together represent the
same agreement.

                                       53
<PAGE>   59

SECTION 10.14 Table of Contents, Headings, etc.

                  The table of contents, cross-reference table and headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part hereof and shall in no way
modify or restrict any of the terms or provisions hereof.

                                       54
<PAGE>   60

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

                                       CONOCO INC.

                                       By: /s/ MIGUEL W. ESPINOSA
                                          --------------------------------------
                                          Miguel W. Espinosa
                                          Treasurer

                                       BANK ONE, N.A.,
                                            as Trustee

                                       By: /s/ DAVID B. KNOX
                                          --------------------------------------
                                          David B. Knox
                                          Authorized Signatory

                                       55<PAGE>   1
                                                                    EXHIBIT 10.1

                              EMPLOYMENT AGREEMENT

         This Employment Agreement ("Agreement") made and entered into effective
as of June 1, 2001 (the "Effective Date") by and between Cyberonics, Inc. (the
"Company"), a Delaware corporation, and Robert P. Cummins (the "Executive").

         WHEREAS, the Company desires to secure the continued employment of the
Executive in accordance herewith and the Executive is willing to commit to be
employed by the Company on the terms and conditions set forth herein and thus to
forgo opportunities elsewhere;

         NOW, THEREFORE, in consideration of the mutual premises, covenants and
agreements set forth below, it is hereby agreed as follows:

         1.       Employment and Term.

                  (a) Employment. The Company agrees to employ the Executive,
         and the Executive agrees to be employed by the Company, in accordance
         with the terms and provisions of this Agreement during the Employment
         Period (as defined below).

                  (b) Term. Subject to earlier termination as provided in
         Section 5, the term of the Executive's employment under this Agreement
         shall commence as of the Effective Date and shall continue until the
         fifth anniversary of the Effective Date (such term being referred to
         hereinafter as the "Employment Period"); provided, however, that
         commencing on the fifth anniversary of the Effective Date (and on each
         anniversary thereafter) the Employment Period automatically shall be
         extended for one additional year, unless six months prior to such
         anniversary date the Company or the Executive shall give written notice
         to the other party that it or the Executive, as the case may be, does
         not wish to so extend this Agreement. However, in the event of a Change
         in Control (as defined below) during the Employment Period, in no event
         shall the Employment Period end prior to the first anniversary of such
         Change in Control.

         2.       Duties and Powers of Executive.

                  (a) Duties. During the Employment Period the Executive shall
         serve as the Chairman of the Board of Directors and the Chief Executive
         Officer of the Company with such authority, duties, powers and
         responsibilities as are normally attributable to such positions and
         with such other duties and responsibilities as may be from time to time
         reasonably assigned to the Executive by the Board of Directors of the
         Company (the "Board").

                  (b) Attention. Except as provided below, during the Employment
         Period the Executive shall devote the Executive's full attention and
         time during normal business hours to the business and affairs of the
         Company and, to the extent necessary to discharge the responsibilities
         assigned to the Executive under this Agreement, use the Executive's
         best efforts to carry out such responsibilities faithfully and
         efficiently. It shall not be considered a violation of the foregoing
         for the Executive to (i) serve on industry, civic or charitable

<PAGE>   2

         boards or committees, (ii) manage the Executive's personal investments,
         or (iii) with the consent of the Board, serve on the boards of other
         businesses, so long as such activities do not interfere with the
         performance of the Executive's duties in accordance with this
         Agreement. In no event shall such activities by the Executive be deemed
         to interfere with the Executive's duties hereunder until the Executive
         has been notified in writing thereof by the Board and given a
         reasonable period in which to cure such interference.

         3. Place of Employment. The Executive's place of employment hereunder
shall be at the Company's principal executive offices in the greater Houston,
Texas area.

         4.       Compensation.

                  (a) Base Salary. During the Employment Period, the Executive's
         annual base salary ("Annual Base Salary") shall be payable in
         accordance with the Company's general payroll practices. As of the
         Effective Date, the Executive's Annual Base Salary shall be $375,000.
         The Board, in its discretion, may from time to time make such upward
         adjustments in the Executive's Annual Base Salary as it deems to be
         necessary or desirable. The Executive's Annual Base Salary (as
         increased from time to time) may not be decreased during the Employment
         Period.

                  (b) Annual Bonus. During the Employment Period, the Executive
         shall participate in the Company's annual bonus plan and will annually
         be eligible to earn a bonus (the "Annual Bonus") up to 100% of his
         Annual Base Salary based upon the achievement of performance goals
         included in the Board approved budget as determined by the Compensation
         Committee.

                  (c) Equity Compensation. On the Effective Date the Executive
         shall be granted an option with respect to 150,000 shares under the
         Company's 1997 Stock Option Plan. During the Employment Period, each
         year the Executive shall be granted stock options under an annual stock
         option grant program by the applicable anniversary of the Effective
         Date. The number of stock options granted each year will be based on
         the Executive's performance in the preceding year as determined by the
         Compensation Committee. In no event will the annual option grant be for
         the purchase of less than 50,000 common shares. Except as provided in
         Section 5, the terms of all options granted to the Executive shall be
         consistent with the grants made to other senior executives of the
         Company.

                  (d) Retirement and Welfare Benefit Plans. During the
         Employment Period, the Executive shall be eligible to participate in
         all savings, retirement and welfare benefit plans, practices, policies
         and programs applicable generally to employees and/or senior executives
         of the Company, subject to meeting the general eligibility requirements
         of such plans or programs.

                  (e) Expenses. The Company shall promptly reimburse the
         Executive for all reasonable business expenses, including those for
         travel and entertainment, properly incurred by the Executive in the
         performance of his duties hereunder in accordance with policies
         established from time to time by the Company.

                                      -2-
<PAGE>   3

                  (f) Fringe Benefits and Perquisites. During the Employment
         Period, the Executive shall be entitled to receive fringe benefits and
         perquisites in accordance with the plans, practices, programs and
         policies of the Company from time to time in effect, and which are
         commensurate with the Executive's positions.

         5.       Termination of Employment.

                  (a) Death or Disability. The Executive's employment shall
         terminate upon the Executive's death or, at the election of the Board
         or the Executive, by reason of his Disability (as defined below) during
         the Employment Period; provided, however, that the Board may not
         terminate the Executive's employment hereunder by reason of Disability
         unless at the time of such termination there is no reasonable
         expectation that the Executive will return to work on a substantially
         full-time basis within the next one hundred eighty day period. For
         purposes of this Agreement, Disability shall mean the Executive is
         receiving long-term disability benefits under the Company's long-term
         disability plan.

                  (b) By the Company for Cause. The Company may terminate the
         Executive's employment during the Employment Period for Cause (as
         defined below). For purposes of this Agreement, "Cause" shall mean (i)
         the willful and continued failure by the Executive to substantially
         perform the Executive's duties with the Company (other than any such
         failure resulting from the Executive's incapacity due to physical or
         mental illness or any such actual or anticipated failure after the
         issuance of a Notice of Termination for Good Reason by the Executive
         pursuant to Section 5(d)), (ii) the Executive's commission of one or
         more acts that constitute a felony or a misdemeanor involving moral
         turpitude, (iii) the Executive is publicly censured by the Securities
         Exchange Commission, or (iv) the Executive commits one or more acts of
         fraud as regards the Company. For purposes of clause (i) of this
         definition, no act, or failure to act, on the Executive's part shall be
         deemed "willful" unless done, or omitted to be done, by the Executive
         not in good faith and without reasonable belief that the Executive's
         act, or failure to act, was in the best interest of the Company. The
         determination of whether Cause exists must be made by a resolution duly
         adopted by the affirmative vote of not less than two-thirds of the
         entire membership of the Board at a meeting of the Board that was
         called for the purpose of considering such termination (after
         reasonable notice to the Executive and an opportunity for the
         Executive, together with the Executive's counsel, to be heard before
         the Board and, if possible, to cure the breach that was the alleged
         basis for Cause ) finding that, in the good faith opinion of the Board,
         the Executive was guilty of conduct and specifying the particulars
         thereof in detail.

                  (c) By the Company without Cause or by the Executive without
         Good Reason. Notwithstanding any other provision of this Agreement, the
         Company, by action of the Board, may terminate the Executive's
         employment other than for Cause during the Employment Period and the
         Executive may similarly terminate his employment for other than Good
         Reason during the Employment Period.

                  (d) By the Executive for Good Reason. The Executive may
         terminate his employment during the Employment Period for Good Reason
         (as defined below). For purposes of this Agreement, "Good Reason" shall
         mean the occurrence, without the written

                                      -3-
<PAGE>   4

         consent of the Executive, of any one of the following acts by the
         Company, or failures by the Company to act, unless such act or failure
         to act is corrected prior to the Date of Termination (as defined below)
         specified in the Notice of Termination (as defined below) given in
         respect thereof:

                           (i) an adverse change in the Executive's title,
                  status, authority, duties, or responsibilities;

                           (ii) any failure by the Company to continue in effect
                  any material incentive compensation or employee benefit plan
                  or arrangement (unless replacement plans providing the
                  Executive with substantially similar benefits are adopted)
                  (herein referred to as "Benefit Plans")) or the taking of any
                  action by the Company that would adversely affect the
                  Executive's participation in any such Benefit Plan or
                  materially reduce the Executive's incentive compensation
                  opportunities or employee benefits under such Benefit Plan, as
                  the case may be;

                           (iii) any purported termination of the Executive's
                  employment that is not effected pursuant to a Notice of
                  Termination satisfying the requirements of Section 5(g); for
                  purposes of this Agreement, no such purported termination
                  shall be effective;

                           (iv) the failure by the Company to obtain a
                  satisfactory agreement from any successor of the Company
                  requiring such successor to assume and agree to perform the
                  Company's obligations under this Agreement, as contemplated in
                  Section 14; or

                           (v) the failure by the Company to comply with any
                  material provision of this Agreement.

                  The Executive's continued employment following any act or
         omission to act constituting Good Reason hereunder shall not constitute
         the Executive's consent to, or a waiver of the Executive's rights with
         respect to, such act or failure to act. The Executive's right to
         terminate the Executive's employment for Good Reason shall not be
         affected by the Executive's incapacity due to physical or mental
         illness. Following a Change in Control (as defined below) the
         Executive's determination that an act or failure to act constitutes
         Good Reason shall be presumed to be valid unless such determination is
         deemed by an arbitrator pursuant to Section 9 be unreasonable and not
         to have been made in good faith by the Executive.

                  (e) Termination by Mutual Agreement. The parties may mutually
         agree that the Executive's employment shall terminate during the
         Employment Period by evidencing their agreement in writing that
         expressly acknowledges it is mutual. Such a mutual termination shall
         not be treated hereunder as a unilateral termination of employment by
         either party.

                  (f) Change in Control. For purposes of this Agreement, a
         Change of Control of the Company shall mean:

                                      -4-
<PAGE>   5

                           (i) the acquisition by any "person," as such term is
                  used in Sections 13(d) and 14(d) of the Securities Exchange
                  Act of 1934, as amended (the "Exchange Act"), other than the
                  Company, a subsidiary of the Company or a Company employee
                  benefit plan, of "beneficial ownership" (as defined in Rule
                  13d-3 under the Exchange Act), directly or indirectly, of
                  securities of the Company representing 50% or more of the
                  combined voting power of the Company's then outstanding
                  securities entitled to vote generally in the election of
                  directors; or

                           (ii) the consummation of a reorganization, merger,
                  consolidation or other form of corporate transaction or series
                  of transactions, in each case, with respect to which persons
                  who were the shareholders of the Company immediately prior to
                  such reorganization, merger or consolidation or other
                  transaction do not, immediately thereafter, own more than 50%
                  of the combined voting power entitled to vote generally in the
                  election of directors of the reorganized, merged or
                  consolidated company's then outstanding voting securities in
                  substantially the same proportions as their ownership
                  immediately prior to such event; or

                           (iii) the sale or disposition by the Company of all
                  or substantially all the Company's assets; or

                           (iv) a change in the composition of the Board, as a
                  result of which fewer than a majority of the directors are
                  Incumbent Directors. "Incumbent Directors" shall mean
                  directors who either (A) are directors of the Company as of
                  October 2, 2000, or (B) are elected, or nominated for
                  election, thereafter to the Board with the affirmative votes
                  of at least a majority of the Incumbent Directors at the time
                  of such election or nomination, but "Incumbent Director" shall
                  not include an individual whose election or nomination is in
                  connection with (i) an actual or threatened election contest
                  (as such terms are used in Rule 14a-11 of Regulation 14A
                  promulgated under the Exchange Act) or an actual or threatened
                  solicitation of proxies or consents by or on behalf of a
                  person other than the Board or (ii) a plan or agreement to
                  replace a majority of the then Incumbent Directors; or

                           (v) the approval by the Board or the stockholders of
                  the Company of a complete or substantially complete
                  liquidation or dissolution of the Company.

                  (g) Notice of Termination. During the Employment Period, any
         purported termination of the Executive's employment (other than by
         reason of death) shall be communicated by written Notice of Termination
         from one party hereto to the other party hereto (or, if by mutual
         agreement by a joint written agreement) in accordance with Section
         14(b). For purposes of this Agreement, a "Notice of Termination" shall
         mean a notice that shall indicate the specific termination provision in
         this Agreement relied upon, if any, and shall set forth in reasonable
         detail the facts and circumstances claimed to provide a basis for
         termination of the Executive's employment under the provision so
         indicated.

                  (h) Date of Termination. "Date of Termination", with respect
         to any purported termination of the Executive's employment during the
         Employment Period, shall mean the

                                      -5-
<PAGE>   6
         date specified in the Notice of Termination (which, in the case of a
         termination by the Company for reasons other than Cause or a
         termination by the Executive shall not be less than 30 days from the
         date such Notice of Termination is given).

         6.       Obligations of the Company Upon Termination.

                  (a) Termination by the Company Other than for Cause, Death or
         Disability or Termination for Good Reason. During the Employment
         Period, if the Company shall terminate the Executive's employment other
         than for Cause, death or Disability or the Executive shall terminate
         his employment for Good Reason, the Company shall pay to the Executive
         the amounts described in this Section 6 (hereinafter referred to as the
         "Severance Payments") and the Executive shall become vested in all
         stock options or other equity based instruments as provided below. The
         amounts specified in this Section 6(a) shall be paid within five
         business days after the Date of Termination.

                           (i) Lump Sum Payment. The Company shall pay to the
                  Executive a lump sum amount in cash equal to the greater of
                  (1) three times the sum of (x) the Executive's Annual Base
                  Salary and (y) an Annual Bonus equal to 100% of such Annual
                  Base Salary, and (2) sum of the amount of Annual Base Salary
                  that would be payable to the Executive if the Employment
                  Period continued through its then term ("Remaining Term"), and
                  an Annual Bonus for such Remaining Term equal to 100% of the
                  Annual Base Salary that would be payable for such period.

                           (ii) Accrued Obligations. The Company shall pay the
                  Executive a lump sum amount in cash equal to the sum of (A)
                  the Executive's earned Annual Base Salary through the Date of
                  Termination to the extent not theretofore paid, (B) an amount
                  equal to any Annual Bonus earned with respect to fiscal years
                  ended prior to the year that includes the Date of Termination
                  to the extent not theretofore paid, and (C) an Annual Bonus
                  for the fiscal year that includes the Date of Termination
                  equal to 100% of his Annual Base Salary multiplied by a
                  fraction, the numerator of which shall be the number of days
                  from the beginning of such fiscal year to and including the
                  Date of Termination and the denominator of which shall be 365.
                  (The amounts specified in clauses (A), (B) and (C) shall be
                  hereinafter referred to as the "Accrued Obligations").

                           (iii) Accelerated Vesting and Payment of Stock
                  Options and Other Equity Based Instruments. All stock options
                  and other equity based instruments held by Executive shall
                  immediately vest and become fully exercisable or payable, as
                  the case may be, as of the Date of Termination. In addition,
                  all of the Executive's stock options and equity based
                  instruments shall remain exercisable through the 180th day
                  following the end of the Remaining Term; provided, however,
                  that in no event shall the options remain outstanding for
                  longer than their original term.

                  (b) Termination by the Company for Cause or by the Executive
         Other than for Good Reason. If the Executive's employment shall be
         terminated for Cause during the Employment

                                      -6-
<PAGE>   7
         Period, or if the Executive terminates his employment during the
         Employment Period other than for Good Reason, the Company shall have no
         further obligations to the Executive under this Agreement other than
         the Accrued Obligations.

                  (c) Termination due to Death or Disability. If the Executive's
         employment shall terminate by reason of death or Disability, the
         Company shall pay the Executive or his estate, as the case may be, the
         Accrued Obligations. Such payments shall be in addition to those rights
         and benefits to which the Executive or his estate may be entitled under
         the relevant Company benefit plans or programs. In addition, all stock
         options and equity based instruments held by the Executive shall
         immediately vest and become fully exercisable or payable, as the case
         may be, as of the Date of Termination. In addition, all of the
         Executive's stock options and equity based instruments shall remain
         exercisable through the 180th day following the end of the Remaining
         Term; provided, however, that in no event shall the options remain
         outstanding for longer than their original term.

                  (d) Mutual Termination of Employment. If the Executive's
         employment shall terminate due to the mutual written agreement of the
         parties, the Company shall pay the Executive an amount in cash equal to
         the sum of (1) his Annual Base Salary plus an Annual Bonus equal to
         100% of his Annual Base Salary and (2) the Accrued Obligations. In
         addition, all stock options and equity based instruments held by the
         Executive shall immediately vest and become fully exercisable or
         payable, as the case may be, as of the Date of Termination. In
         addition, all of the Executive's stock options and equity based
         instruments shall remain exercisable through the 180th day following
         the end of the Remaining Term; provided, however, that in no event
         shall the options remain outstanding for longer than their original
         term.

                  (e) Gross Up Payment. In the event that any payment or benefit
         received or to be received by the Executive (whether pursuant to the
         terms of this Agreement or any other plan, arrangement or agreement
         with (A) the Company, (B) any Person (as defined in Section 5(e)) whose
         actions result in a "change in control" (for purposes of Section 280G
         of the Internal Revenue Code (the "Code")) or (C) any Person affiliated
         with the Company or such Person) (all such payments and benefits being
         hereinafter called "Payments") would be subject to the excise tax
         imposed by Section 4999 of the Code (or any interest or penalties with
         respect to such excise tax (collectively, the "Excise Tax")), then, the
         Company shall pay to the Executive an additional amount (the "Gross-Up
         Payment") such that after payment by the Executive of all taxes
         (including any interest or penalties imposed with respect to such
         taxes), including any Excise Tax, imposed on the Gross-Up Payment, the
         Executive retains an amount of the Gross-Up Payment equal to the Excise
         Tax imposed upon the Payments. For purposes of determining the amount
         of the Gross-Up Payment, the Executive shall be deemed to pay federal
         income tax at the highest marginal rate of federal income taxation in
         the calendar year in which the Gross-Up Payment is to be made and state
         and local income taxes at the highest marginal rate of taxation in the
         state and locality of the Executive's residence on the date on which
         the Gross-Up Payment is calculated for purposes of this section, net of
         the maximum reduction in federal income taxes which could be obtained
         from deduction of such state and local taxes. In the event that the
         Excise Tax is subsequently determined to be less than the amount taken
         into account hereunder, the Executive shall repay to the Company, at
         the time that the amount of such reduction in Excise Tax is
         finally

                                      -7-
<PAGE>   8
         determined, the portion of the Gross-Up Payment attributable to such
         reduction (plus that portion of the Gross-Up Payment being repaid by
         the Executive to the extent that such repayment results in a reduction
         in Excise Tax and/or a federal, state or local income tax deduction)
         plus interest on the amount of such repayment at the rate provided in
         Section 1274(b)(2)(B) of the Code. In the event that the Excise Tax is
         determined to exceed the amount taken into account hereunder (including
         by reason of any payment the existence or amount of which cannot be
         determined at the time of the Gross-Up Payment), the Company shall make
         an additional Gross-Up Payment in respect of such excess (plus any
         interest, penalties or additions payable by the Executive with respect
         to such excess) at the time that the amount of such excess if finally
         determined. The Executive and the Company shall each reasonably
         cooperate with the other in connection with any administrative or
         judicial proceedings concerning the existence or amount of liability
         for Excise Tax with respect to the Payments. It is understood that the
         application of this Section 6 and Section 280G may have differing
         interpretations; however, the parties intend that the Gross-Up Payment
         be determined in a manner that is most favorable to the Executive.

                  (f) Any delay by the Company in paying any amount due the
         Executive under this Agreement shall bear interest at the maximum
         nonusurious rate from the date such payment was due until paid.

         7. Nonexclusivity of Rights. Nothing in this Agreement shall prevent or
limit the Executive's continuing or future participation in any benefit, plan,
program, policy or practice provided by the Company and for which the Executive
may qualify, nor shall anything herein limit or otherwise adversely affect such
rights as the Executive may have under any other contract or agreement entered
into after the Effective Date with the Company. Amounts which are vested
benefits or which the Executive is otherwise entitled to receive under any
benefit, plan, policy, practice or program of, or any contract or agreement
entered into with the Company shall be payable in accordance with such benefit,
plan, policy, practice or program or contract or agreement except as explicitly
modified by this Agreement.

         8. Full Settlement; No Mitigation. The Company's obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other clam, right or action which the Company may have against the
Executive or others, provided that nothing herein shall preclude the Company
from separately pursuing recovery from the Executive based on any such claim. In
no event shall the Executive be obligated to seek other employment or take any
other action by way of mitigation of the amounts (including amounts for damages
for breach) payable to the Executive under any of the provisions of this
Agreement and such amounts shall not be reduced whether or not the Executive
obtains other employment.

         9. Arbitration. Any dispute about the validity, interpretation, effect
or alleged violation of this Agreement (an "arbitrable dispute") must be
submitted to confidential arbitration in Houston, Texas. Arbitration shall take
place before an experienced employment arbitrator licensed to practice law in
such state and selected in accordance with the rules of the Model Employment
Arbitration Procedures of the American Arbitration Association. Arbitration
shall be the exclusive remedy of any arbitrable dispute. Should any party to
this Agreement pursue any arbitrable dispute by any

                                      -8-
<PAGE>   9
method other than arbitration, the other party shall be entitled to recover from
the party initiating the use of such method all damages, costs, expenses and
attorneys' fees incurred as a result of the use of such method. Notwithstanding
anything herein to the contrary, nothing in this Agreement shall purport to
waive or in any way limit the right of any party to seek to enforce any judgment
or decision on an arbitrable dispute in a court of competent jurisdiction. Each
party hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts in Houston, Texas, for the purposes of any proceeding arising out
of this Agreement.

         10. Confidentiality. The Company agrees to provide the Executive, in
the course of his employment with the Company, with non-public privileged or
confidential information and trade secrets concerning the operations, future
plans and methods of doing business of the Company, its subsidiaries and
affiliates ("Proprietary Information"); and the Executive agrees that it would
be extremely damaging to the Company, its subsidiaries and affiliates if such
Proprietary Information were disclosed to a competitor of the Company, its
subsidiaries and affiliates or to any other person or corporation. In
consideration for the Company providing such Proprietary Information to the
Executive, the Executive agrees that all Proprietary Information divulged to the
Executive is in confidence and further agrees to keep all Proprietary
Information secret and confidential (except for such information which is or
becomes publicly available other than as a result of a breach by the Executive
of this provision) without limitation in time. In view of the nature of the
Executive's employment and the Proprietary Information the Executive has
acquired during the course of such employment, the Executive likewise agrees
that the Company, its subsidiaries and affiliates would be irreparably harmed by
any disclosure of Proprietary Information in violation of the terms of this
paragraph and that the Company, its subsidiaries and affiliates shall therefore
be entitled to preliminary and/or permanent injunctive relief prohibiting the
Executive from engaging in any activity or threatened activity in violation of
the terms of this Section and to any other relief available to them. Inquiries
regarding whether specific information constitutes Proprietary Information shall
be directed to the Board, provided that the Company shall not unreasonably
classify information as Proprietary Information.

         11. Non-Solicitation of Employees. The Executive recognizes that he
will be provided confidential information about other employees of the Company,
its subsidiaries and affiliates relating to their education, experience, skills,
abilities, compensation and benefits, and inter-personal relationships with
customers of the Company, its subsidiaries and affiliates and recognizes that
such information is not generally known, is of substantial value to the Company,
its subsidiaries and affiliates in developing their business and in securing and
retaining customers, and has been and will be acquired by him because of his
business position with the Company, its subsidiaries and affiliates.
Accordingly, in consideration of the Proprietary Information and other benefits
provided to the Executive under this Agreement, the Executive agrees that,
during the Employment Period and for the Restricted Period (as defined in
Section 12), he will not, directly or indirectly, solicit or recruit any
employee of the Company, its subsidiaries or affiliates on whose behalf he is
acting as an agent, representative or employee and that he will not convey any
such confidential information or trade secrets about other employees of the
Company, its subsidiaries and affiliates to any other person; provided, however,
that it shall not constitute a solicitation or recruitment of employment in
violation of this Section to discuss employment opportunities with any employee
of the Company, its subsidiaries or affiliates who has either first contacted
the Executive or regarding whose employment the Executive has discussed with and
received the written approval of the Chairman of

                                      -9-
<PAGE>   10
the Board prior to making such solicitation or recruitment In view of the nature
of the Executive's employment with the Company, the Executive likewise agrees
that the Company, its subsidiaries and affiliates would be irreparably harmed by
any solicitation or recruitment in violation of the terms of this paragraph and
that the Company, its subsidiaries and affiliates shall therefore be entitled to
preliminary and/or permanent injunctive relief prohibiting the Executive from
engaging in any activity or threatened activity in violation of the terms of
this Section and to any other relief available to them.

         12.      Noncompetition.

                  (a) In consideration for the Company's providing the Executive
         with Confidential Information during the Employment Period and the
         other benefits provided by this Agreement, the Executive agrees that
         while employed by the Company and for the Restricted Period (as defined
         below), the Executive shall not, unless the Executive receives the
         prior written consent of the Board, own an interest in, manage,
         operate, join, control, lend money or render financial or other
         assistance to or participate in or be connected with, as an officer,
         employee, partner, stockholder, consultant or otherwise, any person
         which competes with the Company in the field of neurostimulation and
         are in a matter covered by a Company patent; provided, however, that
         following the Executive's termination of employment with the Company
         the foregoing restriction shall apply only to those areas where the
         Company is actually doing business on the date of such termination of
         employment. The Restricted Period shall be (i) the one-year period
         following the mutual termination of the Executive's employment and (ii)
         in all other cases, the period beginning on the Date of Termination and
         ending one year after the end of the Remaining Period.

                  (b) The Executive has carefully read and considered the
         provisions of this Section 12 and, having done so, agrees that the
         restrictions set forth in this Section 12 (including the Restricted
         Period, scope of activity to be restrained and the geographical scope)
         are fair and reasonable and are reasonably required for the protection
         of the interests of the Company, its officers, directors, employees,
         creditors and shareholders. The Executive understands that the
         restrictions contained in this Section 12 may limit his ability to
         engage in a business similar to the Company's business, but
         acknowledges that he will receive sufficiently high remuneration and
         other benefits from the Company hereunder to justify such restrictions.

                  (c) It is specifically agreed that the Restricted Period
         following termination of employment, during which the agreements and
         covenants of the Executive made in Sections 11 and 12 shall be
         effective, shall be computed by excluding from such computation any
         time which the Executive is in violation of the provisions of such
         Sections.

                  (d) In the event that any provision of this Section 12
         relating to the Restricted Period and/or the areas of restriction shall
         be declared by a court of competent jurisdiction to exceed the maximum
         time period or areas such court deems reasonable and enforceable, the
         Restricted Period and/or areas of restriction deemed reasonable and
         enforceable by the court shall become and thereafter be the maximum
         time period and/or areas.

                                      -10-
<PAGE>   11

         13. Legal Fees. The Company shall promptly pay all legal fees and
expenses (including, without limitation, fees and expenses in connection with
any arbitration) incurred by the Executive in disputing in good faith any issue
arising under this Agreement relating to the termination of the Executive's
employment or in seeking in good faith to obtain or enforce any benefit or right
provided by this Agreement.

         14.      Successors.

                  (a) Assignment by Executive. This Agreement is personal to the
         Executive and without the prior written consent of the Company shall
         not be assignable by the Executive otherwise than by will or the laws
         of descent and distribution. This Agreement shall inure to the benefit
         of and be enforceable by the Executive's legal representatives.

                  (b) Successors and Assigns of Company. This Agreement shall
         inure to the benefit of and be binding upon the Company, its successors
         and assigns.

                  (c) Assumption. The Company shall require any successor
         (whether direct or indirect, by purchase, merger, consolidation or
         otherwise) to all or substantially all of the business and/or assets of
         the Company to assume expressly and agree in writing prior to such
         succession to perform this Agreement in the same manner and to the same
         extent that the Company would be required to perform it if no such
         succession had taken place. A copy of such agreement shall be furnished
         to the Executive. As used in this Agreement, "Company" shall mean the
         Company as hereinbefore defined and any successor to its businesses
         and/or assets as aforesaid that assumes and agrees to perform this
         Agreement by operation of law or otherwise. Any failure of the Company
         to timely obtain such agreement shall be a material breach of this
         Agreement.

         15.      Miscellaneous.

                  (a) Governing Law. This Agreement shall be governed by and
         construed in accordance with the laws of the State of Texas, without
         reference to its principles of conflict of laws. The captions of this
         Agreement are not part of the provisions hereof and shall have no force
         or effect. This Agreement may not be amended, modified, repealed,
         waived, extended or discharged, except by an agreement in writing
         signed by the party against whom enforcement of such amendment,
         modification, repeal, waiver, extension or discharge is sought. No
         person, other than pursuant to a resolution of the Board or a committee
         thereof, shall have authority on behalf of the Company to agree to
         amend, modify, repeal, waive, extend or discharge any provision of this
         Agreement or anything in reference thereto.

                  (b) Notices. All notices and other communications hereunder
         shall be in writing and shall be given by hand delivery to the other
         party or by registered or certified mail, return receipt requested,
         postage prepaid, addressed, in either case, to the Company's
         headquarters or to such other address as either party shall have
         furnished to the other in writing in accordance herewith. Notices and
         communications shall be effective when actually received by the
         addressee.

                                      -11-
<PAGE>   12

                  (c) Severability. The invalidity or unenforceability of any
         provision of this Agreement shall not affect the validity or
         enforceability of any other provision of this Agreement.

                  (d) Taxes. The Company may withhold from any amounts payable
         or benefits provided under this Agreement such federal, state or local
         taxes as shall be required to be withheld pursuant to any applicable
         law or regulation.

                  (e) No Waiver. The Executive's or the Company's failure to
         insist upon strict compliance with any provision hereof or any other
         provision of this Agreement or the failure to assert any right that the
         Executive or the Company may have hereunder, including, without
         limitation, the right of the Executive to terminate employment for Good
         Reason pursuant to Section 5 of this Agreement.

                  (f) Entire Agreement; Effect on Stock Awards. This instrument
         contains the entire agreement of the Executive and the Company with
         respect to the subject matter hereof, and all promises,
         representations, understandings, arrangements and prior agreements
         between the parties with respect to the subject matter hereof,
         including without limitation that certain Severance Agreement between
         the parties dated May 1, 2001, are terminated hereby. The provisions of
         this Agreement concerning the accelerated vesting and extended period
         for exercise of Company stock options and other stock incentive awards
         shall be deemed to modify any such options and awards outstanding as of
         the Effective Date and shall be incorporated by reference into any such
         grants made after the Effective Date; the intent of the parties being
         that, in the event of any language in any plan or award agreement in
         conflict herewith or to the contrary, the terms of this Agreement shall
         control as to the vesting and exercisability of all outstanding and
         future stock options and stock incentive awards granted to the
         Executive.

         IN WITNESS WHEREOF, the Executive and the Company have caused this
Agreement to be executed effective for all purposes as of the Effective Date.

CYBERONICS, INC.                             CYBERONICS, INC.

By:  s/s Stanley H. Appel                    By:  s/s Tony Coelho
     --------------------                         ---------------
     Stanley H. Appel                             Tony Coelho
     Member of the Board of Directors and         Member of the Board of
     Compensation Committee                       Directors and Compensation
                                                  Committee

                                             EXECUTIVE

                                             s/s Robert P. Cummins
                                             ---------------------
                                                 Robert P. Cummins

                                      -12-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00029-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00029-of-00352.parquet"}]]