Document:

<PAGE>   1
                                  EXHIBIT 10.4

                              EMPLOYMENT AGREEMENT

                    EMPLOYMENT AND NON-COMPETITION AGREEMENT

         THIS EMPLOYMENT AND NON-COMPETITION AGREEMENT, dated as of the 11th day
of February, 1997, by and between American Business Information, Inc., a
Delaware corporation ("ABI" or the "COMPANY"), DBA Holdings, Inc., a New Jersey
corporation ("DBA") and Al Ambrosino the undersigned executive (the "EXECUTIVE")
of DBA.

RECITALS

     A. The Executive is an employee of DBA; and

     B. ABI, DBA and certain other parties have entered into an Agreement and
Plan of Reorganization dated as of February 11, 1997 (the "MERGER AGREEMENT"),
which requires, among other things, that the Executive enter into this
Employment and Non-Competition Agreement in connection with the merger of DBA
with and into a subsidiary of ABI (the "MERGER"), as described in the Merger
Agreement. Capitalized terms not otherwise defined herein shall have the
meanings set forth in the Merger Agreement.

     NOW, THEREFORE, the parties hereto agree as follows:

     1. Effectiveness of Agreement; Employment.

          (a) Effectiveness of Agreement. This Employment and Non-Competition
Agreement shall become effective as of the date the Merger becomes effective
(the "EFFECTIVE TIME"). In the event that the Merger is not consummated, this
Agreement shall be null and void.

          (b) Duties. The Company agrees to employ the Executive in an executive
and managerial capacity, with duties commensurate to a Level 7 or greater ABI
employee, and the Executive agrees to perform such reasonable responsibilities
and duties as may be required of him by the Company; provided, however, that the
Chief Executive Officer of ABI (the "CEO") shall have the right to revise such
responsibilities from time to time as the CEO may deem appropriate. The
Executive shall carry out his duties and responsibilities hereunder in a
diligent and competent manner and shall devote his full business time, attention
and energy thereto.

          (c) Employment At-Will: Severance Benefits. The Company and the
Executive acknowledge and agree that the Executive's employment is at-will, as
defined under applicable law. During the first five (5) years after the
Effective Time, if Executive's employment is terminated by the Company without
Cause, then Executive shall be entitled to the severance benefits as provided in
Section 3 of this Agreement. Except as provided by law, Executive shall not be
entitled to any payments, benefits, damages, awards or compensation other than
as provided in Section 3 of this Agreement.

     2. Compensation and Benefits.

          (a) Base Compensation. The Company shall pay the Executive as
compensation for his services a base salary at the annualized rate of $250,000.
Such salary shall be subject to applicable tax withholding and shall be paid
periodically in accordance with normal Company payroll. The annual compensation
specified in this Section 2, together with any increases in such compensation
that the Company may, in its sole discretion, grant from time to time, is
referred to in this Agreement as "BASE COMPENSATION." Executive shall be
entitled to participate in the Company's bonus program or any future programs
for exectutive or managerial personnel at a level to be determined in the sole
discretion of the Company's Board of Directors. Employee will be reimbursed for
business expenses incurred in accordance with Company policy and practice.

          (b) Increases in Base Compensation. At the sole discretion of ABI, but
in any event based on the Executive's performance and responsibilities
consistent with ABI's past practices and commensurate with executives of ABI at
<PAGE>   2

similar levels of employment, the Executive shall be entitled to be considered
for regular changes in Base Compensation. In the event there is a reduction in
base compensation, the Company shall give Executive 45 days in advance notice.

          (c) Executive Benefits. Executive shall be eligible to participate in
the Company's employee benefit plans and arrangements which are available or
which become available, in the discretion of the Company, to other executive or
managerial employees of the Company, subject in each case to the generally
applicable terms and conditions of the plan or program in question and to the
determination of any committee administering such plan or program.

          (d) Vacation. Executive shall be entitled to vacation in accordance
with the normal vacation policies of the Company for similar managerial or
executive employees.

          (e) Stock Option. The Company shall grant Executive an option (the
"OPTION") to purchase 40,000 shares of ABI Common Stock to be effective as of
the Effective Time. The per share exercise price for the Option shall be equal
to the per share fair market value of ABI Common Stock at the Effective Time.
Except as otherwise provided herein, the Option shall be granted pursuant to,
and shall be governed by, the ABI 1992 Stock Option Plan.

     3. Severance Payments.

          (a) Termination Without Cause. If, during the period ending five years
after the Effective Time, the Executive's employment is terminated by the
Company for any reason other than for Cause, death or disability (the
"TERMINATION WITHOUT CAUSE"), then, subject to the Executive's continuing
obligations under Sections 4 and 5 hereof, the Executive shall receive (i) his
Base Compensation (as determined on the date of termination) at the end of each
month for the period beginning on the date of termination and ended on the fifth
anniversary of the Effective Time and (ii) a lump sum payment equal to one month
of base compensation for each full year of service with ABI, DBA or their
predecessors. Any obligations of the Company pursuant to this Section are
contingent on Executive signing a Release of Claims as defined below.
Termination without cause shall also include Executive's voluntary departure
within thirty (30) days following a reduction in base compensation of more than
10% which is not generally applied to level 7 and above ABI employees.

          (b) Voluntary Resignation; Termination for Cause. If the Executive's
employment terminates by reason of Executive's voluntary resignation, or if the
Executive is terminated for Cause (as defined in Section 6(a)), the Executive
shall not be entitled to receive severance or other benefits.

          (c) Death or Disability. If the Executive's employment terminates as a
result of his death or disability, no compensation or payments will be made to
either the Executive or, in the case of death, Executive's beneficiary or
estate, other than those to which he is entitled under the Company's existing
benefit plans and policies at the time of such termination. For this purpose,
disability is defined to be the inability of the employee to perform his regular
duties for a period of one year due to illness, physical or mental incapacity or
other disability.

     4. Covenants Not to Compensate and Not to Solicit.

          (a) Non-Competition and Non-Solicitation. Executive agrees that during
a period beginning on the date his employment with the Company ends, for
whatever reason (the "TERMINATION DATE") and extending through the third
anniversary of the Termination Date, Executive will not, either for himself or
on behalf of any other person, partnership, firm, association or corporation in
any territory in which ABI is actively engaged in business (1) open or operate a
business which is in competition with any business of ABI on the Termination
Date, (2) act as an employee, agent, advisor or consultant of any then existing
competitor of ABI on the Termination Date, or (3) take any action to, or do
anything reasonably intended to, divert business from ABI or influence or
attempt to influence any existing customer of ABI to cease doing business with
ABI or to alter its then existing business relationship with ABI on the
Termination Date. Executive also covenants that he will not recruit, attempt to
hire, solicit, or assist others in recruiting or hiring any person who is an
employee of ABI or induce or attempt to induce any such employee to terminate
his employment with ABI. As used in this Section 4, "ABI" includes ABI and its
direct and indirect subsidiaries.

          (b) Geographic Area. The parties acknowledge that the business of ABI
is international in scope. Accordingly, the parties agree that the geographical
areas in which the restrictions provided for in this Section apply include all
cities, counties and states of the United States of America and all cities and
provinces of Canada.
<PAGE>   3

          (c) Severability. The scope of the geographic, time and subject matter
restrictions set forth in this Section 4 are intended to conform to applicable
law. If, however, a court determines that the scope of any such restrictions
exceeds what is permitted by law, then such restriction shall be limited or
otherwise reformed as necessary to comply with and be enforceable under
applicable law. If a court determines that any provision of this Section 4 is
unenforceable and cannot be reformed, then such provision shall be deemed
eliminated from this Section to the extent necessary to permit the remaining
provisions of this Section to be enforced.

     5. Confidential Information.

          (a) Company Information. Executive agrees at all times during the term
of Executive's employment and thereafter, to hold in the strictest confidence,
and not to use, except for the benefit of the Company, or to disclose to any
person, firm or corporation without written authorization of the Board of
Directors of ABI, any Confidential Information of the Company. Executive
understands that "CONFIDENTIAL INFORMATION" means any Company proprietary
information, technical data, trade secrets or know-how, including, but not
limited to, research product plans, products, services, customer lists and
customers (including, but not limited to, customers of the Company on whom
Executive's called or with whom Executive became acquainted during the terms of
Executive's employment), markets, software, developments, inventions,
technology, designs, drawings, engineering, hardware configuration information,
marketing, finances or other business information disclosed to Executive by the
Company either directly or indirectly in writing, orally or by drawings or
observation of parts or equipment. Executive further understands that
Confidential Information does not include any of the foregoing items which has
become publicly known and made generally available through no wrongful act of
Executive or of others who were under confidentiality obligations as to the item
or items involved.

          (b) Third Party Information. Executive recognizes that the Company has
received and in the future will receive from third parties their confidential or
proprietary information subject to a duty on the Company's part to maintain the
confidentiality of such information and to use it only for certain limited
purposes. Executive agrees to hold all such confidential or proprietary
information in the strictest confidence and not to disclose it to any person,
firm or corporation or to use it except as necessary in carrying out Executive's
work for the Company consistent with the Company's agreement with such third
party.

     6. Definitions. As used herein, the terms.

          (a) Cause. "CAUSE" means the Executive's termination only if:

               (i) Executive has engaged in willful and material misconduct,
including willful and material failure to perform his duties as an officer or
employee of the Company or a material breach of this Agreement and has failed to
"cure" such default within thirty (30) days after receipt of written notice of
default from the Company;

               (ii) The commission of an act of fraud or embezzlement which
results in loss, damage or injury to the Company;

               (iii) Executive's violation of Sections 4 or 5 of this Agreement;

               (iv) The indictment on charges relating to a felony either in
connection with the performance of the Executive's obligations to the Company or
which shall adversely affect the Executive's ability to perform such
obligations. In the event of arrest or the filing of charges relating to a
felony as set forth above, payments to Employee as provided herein shall be held
pending proof of innocence;

               (v) Gross negligence, dishonesty, breach of fiduciary duty or
material breach of the terms of the this Agreement or any other agreement in
favor of the Company; or

               (vi) The commission of an act which constitutes unfair
competition with the Company.

          (b) Release of Claims. "RELEASE OF CLAIMS" shall mean a waiver by
Executive, in a form substantially similar to that attached as Exhibit A, of all
employment related obligations of and claims and causes of action against the
Company.
<PAGE>   4

     7. Prior Agreements. Executive represents that Executive has not entered
into any agreements, understandings, or arrangements with any person or entity
which would be breached by Executive as a result of, or that would in any way
preclude or prohibit Executive from entering into Agreement with the Company or
performing any of the duties and responsibilities provided for in this
Agreement.

     8. Conflicting Employment. Executive agrees that, during the term of
Executive's employment with the Company, Executive will not engage in any other
employment, occupation, consulting or other business activity directly related
to the business in which the Company is now involved or becomes involved during
the term of Executive's employment, nor will Executive engage in any other
activities that conflict with Executive's obligations to the Company.

     9. Returning Company Documents. Executive agrees that, at the time of
leaving the employ of the Company, Executive will deliver to the Company (and
will not keep in Executive's possession, recreate or deliver to anyone else) any
and all devices, records, data, notes, reports, proposals, lists,
correspondence, specifications, materials, equipment, other documents or
property, or reproductions of any aforementioned items developed by Executive
pursuant to Executive's employment with the Company or otherwise belonging to
the Company, its successors or assigns.

     10. Notices. Any notice, report or other communication required or
permitted to be given hereunder shall be in writing to both parties and shall be
deemed given on the date of delivery, if delivered, or three days after mailing,
if mailed first-class, postage prepaid, to the following addresses:

         If to the  Executive,  at the  address  set forth below the
         Executive's  signature  at the end hereof.

         If to the Company:

         American Business Information, Inc.
         5711 S. 86th Circle
         Omaha, Nebraska 68127
         Attn: Chief Executive Officer

or to such other address as any party hereto may designate by notice given as
herein provided.

     11. Governing Law. This Employment and Non-Competition Agreement shall be
governed by and construed and enforced in accordance with the internal
substantive laws, and not the choice of law rules of New Jersey.

     12. Severability. The invalidity or unenforceability of any provision or
provisions of this Employment and Non-Competition Agreement shall not affect the
validity or enforceability of any other provision hereof, which shall remain in
full force and effect.

     13. Successors.

          (a) Company's Successors. Any successor to the Company (whether direct
or indirect and whether by purchase, lease, merger, consolidation, liquidation
or otherwise) to all or substantially all of the Company's business and/or
assets shall assume the obligations under this Agreement and agree expressly to
perform the obligations under this Employment and Non-Competition Agreement in
the same manner and to the same extent as the Company would be required to
perform such obligations in the absence of a succession. For all purposes under
this Employment and Non-Competition Agreement, the term "COMPANY" shall include
any successor to the Company's business and/or assets which executes and
delivers the assumption agreement described in this subsection (a) or which
becomes bound by the terms of this Employment and Non-Competition Agreement by
operation of law.

          (b) Executive's Successors. The terms of this Employment and
Non-Competition Agreement and all rights of the Executive hereunder shall inure
to the benefit of, and be enforceable by, the Executive's personal or legal
representatives, executors, administrators, successor, heirs, distributees,
devisees or legatees.

     14. Amendment. No waiver, alteration or modification of any of the
provisions of this Employment and Non-Competition Agreement shall be binding
unless in writing and signed by duly authorized representatives of the parties
hereto.
<PAGE>   5

     15. Merger. This Employment and Non-Competition Agreement shall remain in
effect from the date hereof until it is terminated by either party unless the
Merger contemplated by the Merger Agreement is not consummated. In the event of
such a termination, the Executive's obligations hereunder shall terminate
effective as of the effective date of the termination of the Merger Agreement.

     16. Arbitration.

          (a) Executive and Company agree that any dispute or controversy
arising out of, relating to, or in connection with this Employment and
Non-Competition Agreement, or the interpretation, validity, construction,
performance, breach, or termination thereof, shall be finally settled by binding
arbitration to be held in New York, New York under the National Rules for the
Resolution of Employment Disputes supplemented by the Supplemental Procedures
for Large Complex Disputes of the American Arbitration Association as then in
effect (the "RULES"). The arbitrator may grant injunctions or other relief in
such dispute or controversy. The decision of the arbitrator shall be final,
conclusive and binding on the parties to the arbitration. Judgment may be
entered on the arbitrator's decision in any court having jurisdiction. During
the period that any arbitration is taking place, amounts in controversy shall be
paid by the Company into an escrow account.

          (b) The arbitrator(s) shall apply New Jersey law to the merits of any
dispute or claim, without reference to rules of conflicts of law. The
arbitration proceedings shall be governed by federal arbitration law and by the
Rules, without reference to state arbitration law.

          (c) Unless otherwise permitted for by law, or as set forth in the
immediately following sentence, the Company and the Executive shall each pay
half of the costs and expenses of such arbitration. The Company shall pay all of
the costs and expenses of such arbitration in the event that the arbitrator(s)
find in favor of Executive on all matters submitted.

          (d) EXECUTIVE HAS READ AND UNDERSTANDS THIS SECTION 16, WHICH
DISCUSSES ARBITRATION. EXECUTIVE UNDERSTANDS THAT BY SIGNING THIS EMPLOYMENT AND
NON-COMPETITION AGREEMENT, EXECUTIVE AGREES TO SUBMIT ANY CLAIMS ARISING OUT OF,
RELATING TO, OR IN CONNECTION WITH THIS EMPLOYMENT AND NON-COMPETITION
AGREEMENT, OR THE INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH OR
TERMINATION THEREOF TO BINDING ARBITRATION, AND THAT THIS ARBITRATION CLAUSE
CONSTITUTES A WAIVER OF EXECUTIVE'S RIGHT TO A JURY TRIAL AND RELATES TO THE
RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE EMPLOYER/EMPLOYEE
RELATIONSHIP.

     17. Counterparts. This Employment and Non-Competition Agreement may be
executed in several counterparts, each of which shall be an original, but all of
which together shall constitute one and the same agreement.

     18. Effect of Headings. The section headings herein are for convenience
only and shall not affect the construction or interpretation of this Employment
and Non-Competition Agreement.

     19. Definitions. All capitalized terms not otherwise defined herein shall
have the meaning defined in the Merger Agreement.
<PAGE>   6

         IN WITNESS WHEREOF, the parties hereto have executed this Employment
and Non-Competition Agreement as of the date first written above.

                                   AMERICAN BUSINESS INFORMATION, INC.

                                   By:
                                      ------------------------------------------

                                   Its:
                                       -----------------------------------------

                                   DBA HOLDINGS, INC.

                                   By:
                                      ------------------------------------------

                                   Its:
                                       -----------------------------------------

                                   EXECUTIVE

                                   /s/ Allen F. Ambrosino
                                   ---------------------------------------------
                                   (Signature)

                                   Allen F. Ambrosino
                                   ---------------------------------------------
                                   (Print Name)

                                   9 Long Meadow Drive
                                   New City, NY  10956<PAGE>   1
                                                                     EXHIBIT 4.1

                                   ----------

                       AFFILIATED COMPUTER SERVICES, INC.

                                     ISSUER

                                       TO

                        U.S. TRUST COMPANY OF TEXAS, N.A.

                                     TRUSTEE

                                   ----------

                                    INDENTURE

                          Dated as of February 21, 2001

                                   ----------

                      3.50% CONVERTIBLE SUBORDINATED NOTES
                              DUE FEBRUARY 15, 2006

                                   ----------
<PAGE>   2
                       AFFILIATED COMPUTER SERVICES, INC.

           Reconciliation and tie between Trust Indenture Act of 1939
                  and Indenture, dated as of February 21, 2001

                                   ----------

<TABLE>
<CAPTION>
      Section of
    Trust Indenture                                                            Section(s) of
      Act of 1939                                                                Indenture
    ---------------                                                            -------------
<S>          <C>                                                                <C>
Section 310  (a)(1).........................................................     6.8
             (a)(2).........................................................     6.8
             (a)(3).........................................................     Not Applicable
             (a)(4).........................................................     Not Applicable
             (a)(5).........................................................     6.13
             (b)............................................................     6.9
Section 311  (a)............................................................     6.14
             (b)............................................................     6.14
             (c)............................................................     Not Applicable
Section 312  (a)............................................................     15.2(1)
             (b)............................................................     15.2(2)
             (c)............................................................     15.2(3)
Section 313  (a)............................................................     15.4(1)
             (b)............................................................     15.4(1)
             (c)............................................................     15.4(1)
             (d)............................................................     15.4(2)
Section 314  (a)............................................................     15.5
             (b)............................................................     Not Applicable
             (c)(1).........................................................     1.2
             (c)(2).........................................................     1.2
             (c)(3).........................................................     Not Applicable
             (d)............................................................     Not Applicable
             (e)............................................................     1.2
Section 315  (a)............................................................     6.1(1)
             (b)............................................................     6.2
             (c)............................................................     6.1(2)
             (d)............................................................     6.1(3)
             (d)(1).........................................................     6.1(3)(i)
             (d)(2).........................................................     6.1(3)(ii)
             (d)(3).........................................................     6.1(3)(iii)
             (e)............................................................     5.14
Section 316  (a)(1)(A)......................................................     5.12
             (a)(1)(B)......................................................     5.13
             (a)(2).........................................................     Not Applicable
             (a)(last sentence).............................................     1.13
             (b)............................................................     5.8
Section 317  (a)(1).........................................................     5.3
             (a)(2).........................................................     5.4
             (b)............................................................     4.2
Section 318  ...............................................................     1.13
</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>
ARTICLE I DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION.................................................1

        SECTION 1.1 Definitions...................................................................................1
        SECTION 1.2 Compliance Certificates and Opinions.........................................................11
        SECTION 1.3 Form of Documents Delivered to the Trustee...................................................11
        SECTION 1.4 Acts of Holders of Securities................................................................12
        SECTION 1.5 Notices, Etc. to Trustee and Company.........................................................14
        SECTION 1.6 Notice to Holders of Securities; Waiver......................................................14
        SECTION 1.7 Effect of Headings and Table of Contents.....................................................15
        SECTION 1.8 Successors and Assigns.......................................................................15
        SECTION 1.9 Separability Clause..........................................................................15
        SECTION 1.10 Benefits of Indenture.......................................................................15
        SECTION 1.11 Governing Law...............................................................................15
        SECTION 1.12 Legal Holidays..............................................................................16
        SECTION 1.13 Conflict with Trust Indenture Act...........................................................16

ARTICLE II SECURITY FORMS........................................................................................16

        SECTION 2.1 Form Generally...............................................................................16
        SECTION 2.2 Form of Security.............................................................................17
        SECTION 2.3 Form of Certificate of Authentication........................................................31
        SECTION 2.4 Form of Conversion Notice....................................................................31
        SECTION 2.5 Form of Assignment...........................................................................33

ARTICLE III THE SECURITIES.......................................................................................34

        SECTION 3.1 Title and Terms..............................................................................34
        SECTION 3.2 Denominations................................................................................35
        SECTION 3.3 Execution, Authentication, Delivery and Dating...............................................35
        SECTION 3.4 Global Securities; Non-Global Securities; Book-Entry Provisions..............................35
        SECTION 3.5 Registration; Registration of Transfer and Exchange; Restrictions on Transfer................37
        SECTION 3.6 Mutilated, Destroyed, Lost or Stolen Securities..............................................40
        SECTION 3.7 Payment of Interest; Interest Rights Preserved...............................................41
        SECTION 3.8 Persons Deemed Owners........................................................................42
        SECTION 3.9 Cancellation.................................................................................43
        SECTION 3.10 Computation of Interest.....................................................................43
        SECTION 3.11 CUSIP Numbers...............................................................................43

ARTICLE IV SATISFACTION AND DISCHARGE............................................................................43

        SECTION 4.1 Satisfaction and Discharge of Indenture......................................................43
        SECTION 4.2 Application of Trust Money...................................................................45
</TABLE>

                                       i
<PAGE>   4

<TABLE>
<S>                                                                                                             <C>
ARTICLE V REMEDIES...............................................................................................45

        SECTION 5.1 Events of Default............................................................................45
        SECTION 5.2 Acceleration of Maturity; Rescission and Annulment...........................................47
        SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by Trustee..............................48
        SECTION 5.4 Trustee May File Proofs of Claim.............................................................48
        SECTION 5.5 Trustee May Enforce Claims Without Possession of Securities..................................49
        SECTION 5.6 Application of Money Collected...............................................................49
        SECTION 5.7 Limitation on Suits..........................................................................50
        SECTION 5.8 Unconditional Right of Holders to Receive Principal, Premium and Interest and to Convert.....51
        SECTION 5.9 Restoration of Rights and Remedies...........................................................51
        SECTION 5.10 Rights and Remedies Cumulative..............................................................51
        SECTION 5.11 Delay or Omission Not Waiver................................................................51
        SECTION 5.12 Control by Holders of Securities............................................................52
        SECTION 5.13 Waiver of Past Defaults.....................................................................52
        SECTION 5.14 Undertaking for Costs.......................................................................52
        SECTION 5.15 Waiver of Stay, Usury or Extension Laws.....................................................53

ARTICLE VI THE TRUSTEE...........................................................................................53

        SECTION 6.1 Certain Duties and Responsibilities..........................................................53
        SECTION 6.2 Notice of Defaults...........................................................................54
        SECTION 6.3 Certain Rights of Trustee....................................................................54
        SECTION 6.4 Not Responsible for Recitals or Issuance of Securities.......................................55
        SECTION 6.5 May Hold Securities, Act as Trustee Under Other Indentures...................................56
        SECTION 6.6 Money Held in Trust..........................................................................56
        SECTION 6.7 Compensation and Reimbursement...............................................................56
        SECTION 6.8 Corporate Trustee Required; Eligibility......................................................57
        SECTION 6.9 Resignation and Removal; Appointment of Successor............................................57
        SECTION 6.10 Acceptance of Appointment by Successor......................................................58
        SECTION 6.11 Merger, Conversion, Consolidation or Succession to Business.................................59
        SECTION 6.12 Authenticating Agents.......................................................................59
        SECTION 6.13 Disqualification; Conflicting Interests.....................................................61
        SECTION 6.14 Preferential Collection of Claims Against Company...........................................61

ARTICLE VII CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE.................................................61

        SECTION 7.1 Company May Consolidate, Etc., Only on Certain Terms.........................................61
        SECTION 7.2 Successor Substituted........................................................................62

ARTICLE VIII SUPPLEMENTAL INDENTURES.............................................................................62

        SECTION 8.1 Supplemental Indentures Without Consent of Holders of Securities.............................62
        SECTION 8.2 Supplemental Indentures with Consent of Holders of Securities................................63
        SECTION 8.3 Execution of Supplemental Indentures.........................................................64
        SECTION 8.4 Effect of Supplemental Indentures............................................................64
        SECTION 8.5 Reference in Securities to Supplemental Indentures...........................................65
        SECTION 8.6 Notice of Supplemental Indentures............................................................65
</TABLE>

                                       ii
<PAGE>   5

<TABLE>
<S>                                                                                                             <C>
ARTICLE IX MEETINGS OF HOLDERS OF SECURITIES.....................................................................65

        SECTION 9.1 Purposes for Which Meetings May Be Called....................................................65
        SECTION 9.2 Call, Notice and Place of Meetings...........................................................65
        SECTION 9.3 Persons Entitled to Vote at Meetings.........................................................66
        SECTION 9.4 Quorum; Action...............................................................................66
        SECTION 9.5 Determination of Voting Rights; Conduct and Adjournment of Meetings..........................67
        SECTION 9.6 Counting Votes and Recording Action of Meetings..............................................67

ARTICLE X COVENANTS............................................................................................. 68

        SECTION 10.1 Payment of Principal, Premium and Interest..................................................68
        SECTION 10.2 Maintenance of Offices or Agencies..........................................................68
        SECTION 10.3 Money for Security Payments To Be Held in Trust.............................................69
        SECTION 10.4 Existence...................................................................................70
        SECTION 10.5 Maintenance of Properties...................................................................70
        SECTION 10.6 Payment of Taxes and Other Claims...........................................................71
        SECTION 10.7 Registration and Listing....................................................................71
        SECTION 10.8 Statement by Officers as to Default.........................................................71
        SECTION 10.9 Delivery of Certain Information.............................................................72
        SECTION 10.10 Resale of Certain Securities...............................................................72
        SECTION 10.11 Registration Rights........................................................................72
        SECTION 10.12 Waiver of Certain Covenants................................................................74

ARTICLE XI REDEMPTION OF SECURITIES..............................................................................75

        SECTION 11.1 Right of Redemption.........................................................................75
        SECTION 11.2 Applicability of Article....................................................................75
        SECTION 11.3 Election to Redeem; Notice to Trustee.......................................................75
        SECTION 11.4 Selection by Trustee of Securities To Be Redeemed...........................................75
        SECTION 11.5 Notice of Redemption........................................................................76
        SECTION 11.6 Deposit of Redemption Price.................................................................77
        SECTION 11.7 Securities Payable on Redemption Date.......................................................77
        SECTION 11.8 Conversion Arrangement on Call for Redemption...............................................78

ARTICLE XII CONVERSION OF SECURITIES.............................................................................78

        SECTION 12.1 Conversion Privilege and Conversion Rate....................................................78
        SECTION 12.2 Exercise of Conversion Privilege............................................................79
        SECTION 12.3 Fractions of Shares.........................................................................81
        SECTION 12.4 Adjustment of Conversion Rate...............................................................81
        SECTION 12.5 Notice of Adjustments of Conversion Rate....................................................86
        SECTION 12.6 Notice of Certain Corporate.................................................................86
        SECTION 12.7 Company to Reserve Common Stock.............................................................87
        SECTION 12.8 Taxes on Conversions........................................................................87
        SECTION 12.9 Covenant as to Common Stock.................................................................88
        SECTION 12.10 Cancellation of Converted Securities.......................................................88
        SECTION 12.11 Provision in Case of Consolidation, Merger or Sale of Assets...............................88
</TABLE>

                                      iii
<PAGE>   6

<TABLE>
<S>                                                                                                             <C>
        SECTION 12.12 Rights Issued in Respect of Common Stock Issued Upon Conversion............................89
        SECTION 12.13 Responsibility of Trustee for Conversion Provisions........................................90

ARTICLE XIII SUBORDINATION OF SECURITIES.........................................................................90

        SECTION 13.1 Securities Subordinate to Senior Indebtedness...............................................90
        SECTION 13.2 No Payment in Certain Circumstances, Payment Over of Proceeds Upon Dissolution, Etc.........91
        SECTION 13.3 Prior Payment to Senior Indebtedness Upon Acceleration of Securities........................93
        SECTION 13.4 Payment Permitted If No Default.............................................................93
        SECTION 13.5 Subrogation to Rights of Holders of Senior Indebtedness.....................................93
        SECTION 13.6 Provisions Solely to Define Relative Rights.................................................94
        SECTION 13.7 Trustee to Effectuate Subordination.........................................................94
        SECTION 13.8 No Waiver of Subordination Provisions.......................................................94
        SECTION 13.9 Notice to Trustee...........................................................................95
        SECTION 13.10 Reliance on Judicial Order or Certificate of Liquidating Agent.............................96
        SECTION 13.11 Trustee Not Fiduciary for Holders of Senior Indebtedness...................................96
        SECTION 13.12 Reliance by Holders of Senior Indebtedness on Subordination Provisions.....................96
        SECTION 13.13 Rights of Trustee as Holder of Senior Indebtedness; Preservation of Trustee's Rights.......97
        SECTION 13.14 Article Applicable to Paying Agents........................................................97
        SECTION 13.15 Certain Conversions and Repurchases Deemed Payment.........................................97

ARTICLE XIV REPURCHASE OF SECURITIES AT THE OPTION OF THE  HOLDER UPON A CHANGE IN CONTROL.......................98

        SECTION 14.1 Right to Require Repurchase.................................................................98
        SECTION 14.2 Conditions to the Company's Election to Pay the Repurchase Price in Common Stock............98
        SECTION 14.3 Notices; Method of Exercising Repurchase Right, Etc.........................................99
        SECTION 14.4 Certain Definitions........................................................................102
        SECTION 14.5 Consolidation, Merger, Etc.................................................................104

ARTICLE XV HOLDERS LISTS AND REPORTS BY TRUSTEE  AND COMPANY; NON-RECOURSE......................................104

        SECTION 15.1 Company to Furnish Trustee Names and Addresses of Holders..................................104
        SECTION 15.2 Preservation of Information................................................................105
        SECTION 15.3 No Recourse Against Others.................................................................105
        SECTION 15.4 Reports by Trustee.........................................................................105
        SECTION 15.5 Reports by Company.........................................................................105

ARTICLE XVI IMMUNITY OF INCORPORATORS, STOCKHOLDERS,  OFFICERS AND DIRECTORS....................................106

        SECTION 16.1 Indenture and Securities Solely Corporate Obligations......................................106
</TABLE>

                                       iv
<PAGE>   7

ANNEX A -- Form of Restricted Securities Certificate
ANNEX B -- Form of Unrestricted Securities Certificate
ANNEX C -- Form of Surrender Certificate

                                       v
<PAGE>   8

         INDENTURE, dated as of February 21, 2001, between AFFILIATED COMPUTER
SERVICES, INC., a corporation duly organized and existing under the laws of the
State of Delaware, having its principal office at 2828 North Haskell, Dallas,
Texas 75204 (herein called the "Company"), and U.S. TRUST COMPANY OF TEXAS,
N.A., a national banking association, as Trustee hereunder (herein called the
"Trustee").

                             RECITALS OF THE COMPANY

                  The Company has duly authorized the creation of an issue of
its 3.50% Convertible Subordinated Notes due February 15, 2006 (herein called
the "Securities") of substantially the tenor and amount hereinafter set forth,
and to provide therefor the Company has duly authorized the execution and
delivery of this Indenture.

                  All things necessary to make the Securities, when the
Securities are executed by the Company and authenticated and delivered
hereunder, the valid obligations of the Company, and to make this Indenture a
valid agreement of the Company, in accordance with their and its terms, have
been done. Further, all things necessary to duly authorize the issuance of the
Class A Common Stock of the Company issuable upon the conversion of the
Securities, and to duly reserve for issuance the number of shares of Class A
Common Stock issuable upon such conversion, have been done.

                  NOW, THEREFORE, THIS INDENTURE WITNESSETH:

                  For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually covenanted and agreed, for
the equal and proportionate benefit of all Holders of the Securities, as
follows:

                                   ARTICLE I
                        DEFINITIONS AND OTHER PROVISIONS
                             OF GENERAL APPLICATION

SECTION 1.1       Definitions.

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

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

                  (2) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States, and, except as otherwise herein expressly
provided, the term "generally accepted

                                       1
<PAGE>   9

accounting principles" with respect to any computation required or permitted
hereunder shall mean such accounting principles as are generally accepted at the
date of such computation; and

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

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

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

                  "Agent Member" means any member of, or participant in, the
Depositary.

                  "Applicable Procedures" means, with respect to any notice,
transfer or transaction involving a Global Security or beneficial interest
therein, the rules and procedures of the Depositary, in each case to the extent
applicable to such transaction and as in effect from time to time.

                  "Authenticating Agent" means any Person authorized pursuant to
Section 6.12 to act on behalf of the Trustee to authenticate Securities.

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

                  "Board Resolution" means a resolution duly adopted by the
Board of Directors, a copy of which, 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, shall have
been delivered to the Trustee.

                  "Business Day", when used with respect to any Place of
Payment, Place of Conversion or any other place, as the case may be, means each
Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in such Place of Payment, Place of Conversion or other
place, as the case may be, are authorized or obligated by law or executive order
to close; provided, however, that a day on which banking institutions in New
York, New York or London, England are authorized or obligated by law or
executive order to close shall not be a Business Day for purposes of Section
13.9.

                  "Change in Control" has the meaning specified in Section
14.4(2).

                                       2
<PAGE>   10

                  "Closing Price Per Share" means, with respect to the Common
Stock, for any day, (i) the last reported sale price regular way on the New York
Stock Exchange or, (ii) if the Common Stock is not listed on the New York Stock
Exchange, the last reported sale price regular way per share or, in case no such
reported sale takes place on such day, the average of the reported closing bid
and asked prices regular way, in either case, on the principal national
securities exchange on which the Common Stock is listed or admitted to trading,
or (iii) if the Common Stock is not quoted on the New York Stock Exchange or
listed or admitted to trading on any national securities exchange, the average
of the closing bid prices in the over-the-counter market as furnished by any New
York Stock Exchange member firm selected from time to time by the Company for
that purpose.

                  "Code" has the meaning specified in Section 2.l.

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

                  "Common Stock" means the Class A Common Stock, par value $0.01
per share, of the Company authorized at the date of this instrument as
originally executed. Subject to the provisions of Section 12.11, shares issuable
on conversion or repurchase of Securities shall include only shares of Common
Stock or shares of any class or classes of common stock resulting from any
reclassification or reclassifications thereof; provided, however, that if at any
time there shall be more than one such resulting class, the shares so issuable
on conversion of Securities shall include shares of all such classes, and the
shares of each such class then so issuable shall be substantially in the
proportion which the total number of shares of such class resulting from all
such reclassifications bears to the total number of shares of all such classes
resulting from all such reclassifications.

                  "common stock" includes any stock of any class of capital
stock which has no preference in respect of dividends or of amounts payable in
the event of any voluntary or involuntary liquidation, dissolution or winding up
of the issuer thereof and which is not subject to redemption by the issuer
thereof.

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

                  "Company Notice" has the meaning specified in Section 14.3.

                  "Company Request" or "Company Order" means a written request
or order signed in the name of the Company by its Chairman of the Board, its
Vice Chairman of the Board, its Chief Executive Officer, its President, an
Executive Vice President or a Vice President, and by its principal financial
officer, Treasurer, an Assistant Treasurer, its Secretary or an Assistant
Secretary, and delivered to the Trustee.

                                       3
<PAGE>   11

                  "Constituent Person" has the meaning specified in Section
12.11.

                  "Conversion Agent" means any Person authorized by the Company
to convert Securities in accordance with Article XII. The Company has initially
appointed the Trustee as its Conversion Agent pursuant to Section 10.2 hereof.

                  "Conversion Price" has the meaning specified in Section
14.4(3).

                  "Conversion Rate" has the meaning specified in Section 12.1.

                  "Corporate Trust Office" means the office of the Trustee at
which at any particular time its corporate trust business shall be principally
administered (which at the date of this Indenture is located at 2001 Ross
Avenue, Suite 2700, Dallas, Texas 75201-2936, Attention: Corporate Trust
Division).

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

                  "Credit Agreement" means that certain Credit Agreement, dated
as of May 12, 2000, between the Company, Wells Fargo Bank Texas, National
Association, Administrative Agent and Co-Lead Arranging Agent, Bank One, N.A.,
Syndication Agent and Co-Lead Arranging Agent, SunTrust Bank, Documentation
Agent, The Bank of Tokyo-Mitsubishi, Ltd., Co-Agent, and certain Lenders and
certain Subsidiary Guarantors for $450,000,000 Revolving Credit Facility.

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

                  "Depositary" means, with respect to any Securities (including
any Global Securities), a clearing agency that is registered as such under the
Exchange Act and is designated by the Company to act as Depositary for such
Securities (or any successor securities clearing agency so registered).

                  "Designated Senior Indebtedness" means the Company's
obligations under the Credit Agreement and any particular Senior Indebtedness in
which the instrument creating or evidencing the same or the assumption or
guarantee thereof (or related agreements or documents to which the Company is a
party) expressly provides that such Senior Indebtedness shall be "Designated
Senior Indebtedness" for purposes of this Indenture (provided that such
instrument, agreement or other document may place limitations and conditions on
the right of such Senior Indebtedness to exercise the rights of Designated
Senior Indebtedness).

                  "Distribution Date" shall mean the "Distribution Date" as such
term is defined in the Rights Agreement.

                                       4
<PAGE>   12

                  "Dollar" or "U.S. $" 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 debts.

                  "DTC" means The Depository Trust Company, a New York
corporation.

                  "Effective Failure" has the meaning specified in Section
10.11.

                  "Effectiveness Period" has the meaning specified in Section
10.11.

                  "Event of Default" has the meaning specified in Section 5.1.

                  "Exchange Act" means the United States Securities Exchange Act
of 1934 (or any successor statute), as amended from time to time.

                  "Global Security" means a Security that is registered in the
Security Register in the name of a Depositary or a nominee thereof.

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

                  "Indenture" means this instrument as originally executed or as
it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively.

                  "Initial Purchasers" means Goldman, Sachs & Co. and Bear,
Stearns & Co. Inc.

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

                  "Issue Date" means February 21, 2001.

                  "Liquidated Damages" has the meaning specified in Section
10.11.

                  "Maturity", when used with respect to any Security, means the
date on which the principal of such Security becomes due and payable as therein
or herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption, exercise of the repurchase right set forth in
Article XIV or otherwise.

                  "Non-electing Share" has the meaning specified in Section
12.11.

                  "Notice of Default" has the meaning specified in Section 5.1.

                                       5
<PAGE>   13

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

                  "Opinion of Counsel" means a written opinion of counsel, who
may be counsel for the Company and who shall be acceptable to the Trustee.

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

                  (i) Securities theretofore canceled by the Trustee or
delivered to the Trustee for cancellation;

                  (ii) Securities for the payment or redemption of which money
in the necessary amount has been theretofore deposited with the Trustee or any
Paying Agent (other than the Company) in trust or set aside and segregated in
trust by the Company (if the Company shall act as its own Paying Agent) for the
Holders of such Securities, provided that if such Securities are to be redeemed,
notice of such redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made;

                  (iii) Securities which have been paid pursuant to Section 3.6
or in exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser in
whose hands such Securities are valid obligations of the Company; and

                  (iv) Securities converted into Common Stock pursuant to
Article XII;

provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities are present at a meeting of Holders
of Securities for quorum purposes or have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such determination as to the presence of a quorum or upon
any such request, demand, authorization, direction, notice, consent or waiver,
only Securities which a Responsible Officer of the Trustee has been notified in
writing to be so owned shall be so disregarded. Securities so owned which have
been pledged in good faith may be regarded as Outstanding if the pledgee is not
the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor, and the Trustee shall be protected in relying
upon an Officer's Certificate to such effect.

                  "Paying Agent" means any Person authorized by the Company to
pay the principal of or interest on any Securities on behalf of the Company and,
except as otherwise specifically set forth herein, such term shall include the
Company if it shall act as its own Paying Agent. The Company has initially
appointed the Trustee as its Paying Agent pursuant to Section 10.2 hereof.

                                       6
<PAGE>   14

                  "Payment Blockage Notice" has the meaning specified in Section
13.2.

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

                  "Place of Conversion" has the meaning specified in Section
3.1.

                  "Place of Payment" has the meaning specified in Section 3.1.

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

                  "Purchase Agreement" means the Purchase Agreement, dated
February 15, 2001, between the Company and the Initial Purchasers, as such
agreement may be amended from time to time.

                  "Qualified Institutional Buyer" shall mean a "qualified
institutional buyer" as defined in Rule 144A.

                  "Record Date" means any Regular Record Date or Special Record
Date.

                  "Record Date Period" means the period from the close of
business of any Regular Record Date next preceding any Interest Payment Date to
the opening of business on such Interest Payment Date.

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

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

                  "Registrable Securities" has the meaning specified in Section
10.11.

                  "Registration Default" has the meaning specified in Section
10.11.

                  "Registration Rights Agreement" means the Registration Rights
Agreement, dated February 21, 2001, between the Company and the Initial
Purchasers, as such agreement may be amended from time to time.

                                       7
<PAGE>   15

                  "Regular Record Date" for interest payable in respect of any
Security on any Interest Payment Date means the February 1 or August 1 (whether
or not a Business Day), as the case may be, next preceding such Interest Payment
Date.

                   "Representative" means the (a) indenture trustee or other
trustee, agent or representative for any Senior Indebtedness or (b) with respect
to any Senior Indebtedness that does not have any such trustee, agent or other
representative, (i) in the case of such Senior Indebtedness issued pursuant to
an agreement providing for voting arrangements as among the holders or owners of
such Senior Indebtedness, any holder or owner of such Senior Indebtedness acting
with the consent of the required persons necessary to bind such holders or
owners of such Senior Indebtedness and (ii) in the case of all other such Senior
Indebtedness, the holder or owner of such Senior Indebtedness.

                  "Repurchase Date" has the meaning specified in Section 14.1.

                  "Repurchase Price" has the meaning specified in Section 14.1.

                  "Responsible Officer", when used with respect to the Trustee,
means any officer within the Corporate Trust Office of the Trustee with direct
responsibility for the administration of this Indenture and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of his knowledge and familiarity with the particular
subject.

                  "Restricted Global Security" has the meaning specified in
Section 2.1.

                  "Restricted Securities" means all Securities required pursuant
to Section 3.5(3) to bear any Restricted Securities Legend. Such term includes
the Restricted Global Security.

                  "Restricted Securities Certificate" means a certificate
substantially in the form set forth in Annex A.

                  "Restricted Securities Legend" means, collectively, the
legends substantially in the forms of the legends required in the form of
Security set forth in Section 2.2 to be placed upon each Restricted Security.

                  "Rights" shall mean "Rights" as such term is defined in the
Rights Agreement.

                  "Rights Agreement" means that certain Rights Agreement dated
August 11, 1997 between the Company and ChaseMellon Shareholder Services,
L.L.C., as rights agent thereunder, as amended from time to time.

                  "Rule 144A" means Rule 144A under the Securities Act (or any
successor provision), as it may be amended from time to time.

                  "Rule 144A Information" has the meaning specified in Section
10.9.

                                       8
<PAGE>   16

                  "Securities" has the meaning ascribed to it in the first
paragraph under the caption "Recitals of the Company".

                  "Securities Act" means the United States Securities Act of
1933 (or any successor statute), as amended from time to time.

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

                  "Senior Indebtedness" means the principal of (and premium, if
any) and interest (including all interest accruing subsequent to the
commencement of any bankruptcy or similar proceeding, whether or not a claim for
post-petition interest is allowable as a claim in any such proceeding) on, and
all fees and other amounts payable in connection with, the following, whether
absolute or contingent, secured or unsecured, due or to become due, outstanding
on the date of the Indenture or thereafter created, incurred or assumed: (a)
indebtedness of the Company evidenced by a credit or loan agreement, note, bond,
debenture or other written obligation, (b) all obligations of the Company for
money borrowed, (c) all obligations of the Company evidenced by a note or
similar instrument given in connection with the acquisition of any businesses,
properties or assets of any kind, (d) obligations of the Company (i) as lessee
under leases required to be capitalized on the balance sheet of the lessee under
generally accepted accounting principles and (ii) as lessee under other leases
for facilities, capital equipment or related assets, whether or not capitalized,
entered into or leased for financing purposes, (e) all obligations of the
Company under interest rate and currency swaps, caps, floors, collars, hedge
agreements, forward contracts or similar agreements or arrangements, (f) all
obligations of the Company with respect to letters of credit, bankers'
acceptances and similar facilities (including reimbursement obligations with
respect to the foregoing), (g) all obligations of the Company issued or assumed
as the deferred purchase price of property or services (but excluding trade
accounts payable and accrued liabilities arising in the ordinary course of
business), (h) all obligations of the type referred to in clauses (a) through
(g) above of another Person and all dividends of another Person, the payment of
which, in either case, the Company has assumed or guaranteed, or for which the
Company is responsible or liable, directly or indirectly, jointly or severally,
as obligor, guarantor or otherwise, or which is secured by a lien on the
property of the Company, and (i) renewals, extensions, modifications,
replacements, restatements and refundings of, or any indebtedness or obligation
issued in exchange for, any such indebtedness or obligation described in clauses
(a) through (h) of this paragraph; provided, however, that Senior Indebtedness
shall not include the Securities or any such indebtedness or obligation if the
terms of such indebtedness or obligation (or the terms of the instrument under
which, or pursuant to which it is issued) expressly provide that such
indebtedness or obligation is not superior in right of payment to the
Securities.

                  "Shelf Registration Statement" has the meaning specified in
Section 10.11.

                                       9
<PAGE>   17

                  "Significant Subsidiary" means, with respect to any Person, a
Subsidiary of such Person that would constitute a "significant subsidiary" as
such term is defined under Rule 1-02 of Regulation S-X under the Securities Act.

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

                  "Stated Maturity", when used with respect to any Security or
any installment of interest thereon, means the date specified in such Security
as the fixed date on which the principal of such Security or such installment of
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 or other similar interests in the corporation which ordinarily has or have
voting power for the election of directors, or persons performing similar
functions, whether at all times or only so long as no senior class of stock or
other interests has or have such voting power by reason of any contingency.

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

                  "Surrender Certificate" means a certificate substantially in
the form set forth in Annex C.

                  "Trading Day" means a day during which trading in securities
generally occurs on the New York Stock Exchange or, if the Common Stock is not
listed on the New York Stock Exchange, on the principal other national or
regional securities exchange on which the Common Stock is then listed or, if the
Common Stock is not listed on a national or regional securities exchange, on the
Nasdaq National Market or, if the Common Stock is not then quoted on the Nasdaq
National Market, on the principal other market on which the Common Stock is then
traded.

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

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

                                       10
<PAGE>   18

                  "United States" means the United States of America (including
the States and the District of Columbia), its territories, its possessions and
other areas subject to its jurisdiction (its "possessions" including Puerto
Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the
Northern Mariana Islands).

                  "Unrestricted Securities Certificate" means a certificate
substantially in the form set forth in Annex B.

SECTION 1.2       Compliance Certificates and Opinions.

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

                  Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (including certificates
provided for in Section 10.8) shall include:

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

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

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

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

SECTION 1.3       Form of Documents Delivered to the Trustee.

                  In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.

                                       11
<PAGE>   19

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

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

SECTION 1.4       Acts of Holders of Securities.

                  (1) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given or taken by Holders of Securities may be embodied in and evidenced by (A)
one or more instruments of substantially similar tenor signed by such Holders in
person or by an agent or proxy duly appointed in writing by such Holders or (B)
the record of Holders of Securities voting in favor thereof, either in person or
by proxies duly appointed in writing, at any meeting of Holders of Securities
duly called and held in accordance with the provisions of Article IX. Such
action shall become effective when such instrument or instruments or record is
delivered to the Trustee and, where it is hereby expressly required, to the
Company. The Trustee shall promptly deliver to the Company copies of all such
instruments and records delivered to the Trustee. Such instrument or instruments
and record (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Holders of Securities signing such
instrument or instruments and so voting at such meeting. Proof of execution of
any such instrument or of a writing appointing any such agent or proxy, or of
the holding by any Person of a Security, shall be sufficient for any purpose of
this Indenture and (subject to Section 6.1) conclusive in favor of the Trustee
and the Company if made in the manner provided in this Section. The record of
any meeting of Holders of Securities shall be proved in the manner provided in
Section 9.6.

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

                  (3) The principal amount and serial number of any Security
held by any Person, and the date of his holding the same, shall be proved by the
Security Register.

                                       12
<PAGE>   20

                  (4) The fact and date of execution of any such instrument
or writing and the authority of the Person executing the same may also be proved
in any other manner which the Trustee deems sufficient; and the Trustee may in
any instance require further proof with respect to any of the matters referred
to in this Section 1.4.

                  (5) The Company may set any day as the record date for the
purpose of determining the Holders entitled to give or take any request, demand,
authorization, direction, notice, consent, waiver or other action, or to vote on
any action, authorized or permitted by this Indenture to be given or taken by
Holders. Promptly and in any case not later than ten days after setting a record
date, the Company shall notify the Trustee and the Holders of such record date.
If not set by the Company prior to the first solicitation of a Holder made by
any Person in respect of any such action, or, in the case of any such vote,
prior to such vote, the record date for any such action or vote shall be the
30th day (or, if later, the date of the most recent list of Holders required to
be provided pursuant to Section 15.1) prior to such first solicitation or vote,
as the case may be. With regard to any record date, the Holders on such date (or
their duly appointed agents or proxies), and only such Persons, shall be
entitled to give or take, or vote on, the relevant action, whether or not such
Holders remain Holders after such record date. Notwithstanding the foregoing,
the Company shall not set a record date for, and the provisions of this
paragraph shall not apply with respect to, any notice, declaration or direction
referred to in the next paragraph.

                  Upon receipt by the Trustee from any Holder of (i) any notice
of default or breach referred to in Section 5.1(4), if such default or breach
has occurred and is continuing and the Trustee shall not have given such a
notice to the Company, (ii) any declaration of acceleration referred to in
Section 5.2, if an Event of Default has occurred and is continuing and the
Trustee shall not have given such a declaration to the Company, or (iii) any
direction referred to in Section 5.12, if the Trustee shall not have taken the
action specified in such direction, then, with respect to clauses (ii) and
(iii), a record date shall automatically and without any action by the Company
or the Trustee be set for determining the Holders entitled to join in such
declaration or direction, which record date shall be the close of business on
the tenth day (or, if such day is not a Business Day, the first Business Day
thereafter) following the day on which the Trustee receives such declaration or
direction, and, with respect to clause (i), the Trustee may set any day as a
record date for the purpose of determining the Holders entitled to join in such
notice of default. Promptly after such receipt by the Trustee of any such
declaration or direction referred to in clause (ii) or (iii), and promptly after
setting any record date with respect to clause (i), and as soon as practicable
thereafter, the Trustee shall notify the Company and the Holders of any such
record date so fixed. The Holders on such record date (or their duly appointed
agents or proxies), and only such Persons, shall be entitled to join in such
notice, declaration or direction, whether or not such Holders remain Holders
after such record date; provided that, unless such notice, declaration or
direction shall have become effective by virtue of Holders of the requisite
principal amount of Securities on such record date (or their duly appointed
agents or proxies) having joined therein on or prior to the 90th day after such
record date, such notice, declaration or direction shall automatically and
without any action by any Person be canceled and of no further effect. Nothing
in this paragraph shall be construed to prevent a Holder (or a duly

                                       13
<PAGE>   21

appointed agent or proxy thereof) from giving, before or after the expiration of
such 90-day period, a notice, declaration or direction contrary to or different
from, or, after the expiration of such period, identical to, the notice,
declaration or direction to which such record date relates, in which event a new
record date in respect thereof shall be set pursuant to this paragraph. In
addition, nothing in this paragraph shall be construed to render ineffective any
notice, declaration or direction of the type referred to in this paragraph given
at any time to the Trustee and the Company by Holders (or their duly appointed
agents or proxies) of the requisite principal amount of Securities on the date
such notice, declaration or direction is so given.

                  (6) Except as provided in Sections 5.12 and 5.13, any request,
demand, authorization, direction, notice, consent, election, waiver or other Act
of the Holder of any Security shall bind every future Holder of the same
Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such
Security.

                  (7) The provisions of this Section 1.4 are subject to the
provisions of Section 9.5.

SECTION 1.5       Notices, Etc. to Trustee and Company.

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

                  (1) the Trustee by any Holder of Securities or by the Company
shall be sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with a Responsible Officer of the Trustee and received at
its Corporate Trust Office, Attention: Corporate Trust Administration.

                  (2) the Company by the Trustee or by any Holder of Securities
shall be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing, mailed, first-class postage prepaid, or
telecopied and confirmed by mail, first-class postage prepaid, or delivered by
hand or overnight courier, addressed to the Company at 2828 North Haskell
Avenue, Dallas, Texas 75204, Attention: General Counsel, or at any other address
previously furnished in writing to the Trustee by the Company.

SECTION 1.6       Notice to Holders of Securities; Waiver.

                  Except as otherwise expressly provided herein, where this
Indenture provides for notice to Holders of Securities of any event, such notice
shall be sufficiently given to Holders if in writing and mailed, first-class
postage prepaid, to each Holder of a Security affected by such event, at the
address of such Holder as it appears in the Security Register, not earlier than
the earliest date and not later than the latest date prescribed for the giving
of such notice.

                                       14
<PAGE>   22

                  Neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder of a Security shall affect the
sufficiency of such notice with respect to other Holders of Securities. In case
by reason of the suspension of regular mail service or by reason of any other
cause it shall be impracticable to give such notice by mail, then such
notification to Holders of Securities as shall be made with the approval of the
Trustee, which approval shall not be unreasonably withheld, shall constitute a
sufficient notification to such Holders for every purpose hereunder.

                  Such notice shall be deemed to have been given when such
notice is mailed.

                  Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders of Securities shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.

SECTION 1.7       Effect of Headings and Table of Contents.

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

SECTION 1.8       Successors and Assigns.

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

SECTION 1.9       Separability Clause.

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

SECTION 1.10      Benefits of Indenture.

                  Except as provided in the next sentence, nothing in this
Indenture or in the Securities, express or implied, shall give to any Person,
other than the parties hereto and their successors and assigns hereunder and the
Holders of Securities, any benefit or legal or equitable right, remedy or claim
under this Indenture. The provisions of Article XIII are intended to be for the
benefit of, and shall be enforceable directly by, the holders of Senior
Indebtedness.

SECTION 1.11      Governing Law.

         THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, THE UNITED STATES OF AMERICA.

                                       15
<PAGE>   23

SECTION 1.12      Legal Holidays.

                  In any case where any Interest Payment Date, Redemption Date,
Repurchase Date or Stated Maturity of any Security or the last day on which a
Holder of a Security has a right to convert his Security shall not be a Business
Day at a Place of Payment or Place of Conversion, as the case may be, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of principal of, premium, if any, or interest on, or the payment of the
Redemption Price or Repurchase Price (whether the same is payable in cash or in
shares of Common Stock in the case of the Repurchase Price) with respect to, or
delivery for conversion of, such Security need not be made at such Place of
Payment or Place of Conversion, as the case may be, on or by such day, but may
be made on or by the next succeeding Business Day at such Place of Payment or
Place of Conversion, as the case may be, with the same force and effect as if
made on the Interest Payment Date, Redemption Date or Repurchase Date, or at the
Stated Maturity or by such last day for conversion; provided, however, that in
the case that payment is made on such succeeding Business Day, no interest shall
accrue on the amount so payable for the period from and after such Interest
Payment Date, Redemption Date, Repurchase Date, Stated Maturity or last day for
conversion, as the case may be.

SECTION 1.13      Conflict with Trust Indenture Act.

                  If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act that may be so modified or excluded, the latter provision shall be
deemed to apply to this Indenture as so modified or to be excluded, as the case
may be. Until such time as this Indenture shall be qualified under the Trust
Indenture Act, this Indenture, the Company and the Trustee shall be deemed for
all purposes hereof to be subject to and governed by the Trust Indenture Act to
the same extent as would be the case if this Indenture were so qualified on the
date hereof.

                                   ARTICLE II
                                 SECURITY FORMS

SECTION 2.1       Form Generally.

The Securities shall be in substantially the form set forth in this Article,
with such appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture, and may have such letters,
numbers or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with the rules of any securities exchange,
the Internal Revenue Code of 1986, as amended, and regulations thereunder (the
"Code"), or as may, consistent herewith, be determined by the officers executing
such Securities, as evidenced by their execution thereof. All Securities shall
be in fully registered form.

                  The Trustee's certificates of authentication shall be in
substantially the form set forth in Section 2.3.

                                       16
<PAGE>   24

                  Conversion notices shall be in substantially the form set
forth in Section 2.4.

                  Repurchase notices shall be substantially in the form set
forth in Section 2.2.

                  The Securities shall be printed, lithographed, typewritten or
engraved or produced by any combination of these methods or may be produced in
any other manner permitted by the rules of any automated quotation system or
securities exchange (including on steel engraved borders if so required by any
securities exchange upon which the Securities may be listed) on which the
Securities may be quoted or listed, as the case may be, all as determined by the
officers executing such Securities, as evidenced by their execution thereof.

                  Upon their original issuance, Securities issued as
contemplated by the Purchase Agreement to Qualified Institutional Buyers in
reliance on Rule 144A shall be issued in the form of one or more Global
Securities in definitive, fully registered form without interest coupons and
bearing the Restricted Securities Legend. Such Global Security shall be
registered in the name of DTC, as Depositary, or its nominee and deposited with
the Trustee, as custodian for DTC, for credit by DTC to the respective accounts
of beneficial owners of the Securities represented thereby (or such other
accounts as they may direct). Such Global Security, together with its Successor
Securities which are Global Securities, are collectively herein called the
"Restricted Global Security".

SECTION 2.2       Form of Security.

[FORM OF FACE]

[THE FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH RESTRICTED SECURITY:

                  THIS SECURITY AND ANY CLASS A COMMON STOCK ISSUABLE UPON THE
CONVERSION OF THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS SECURITY THAT IS A QUALIFIED INSTITUTIONAL
BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IS HEREBY NOTIFIED THAT
THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS
OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.

                  THIS SECURITY AND ANY SHARES OF CLASS A COMMON STOCK ISSUABLE
UPON ITS CONVERSION MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
EXCEPT (I) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER ACQUIRING FOR ITS OWN ACCOUNT OR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II)
PURSUANT TO THE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT

                                       17
<PAGE>   25

PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (III) TO AN INSTITUTIONAL
INVESTOR THAT IS AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1),
(2), (3) OR (7) UNDER THE SECURITIES ACT IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, OR (IV) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND IN EACH OF CASES
(I) THROUGH (IV) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES
AND OTHER JURISDICTIONS OF THE UNITED STATES.

                  THIS SECURITY, ANY SHARES OF CLASS A COMMON STOCK ISSUABLE
UPON ITS CONVERSION AND ANY RELATED DOCUMENTATION MAY BE AMENDED OR SUPPLEMENTED
FROM TIME TO TIME TO MODIFY THE RESTRICTIONS ON RESALES AND OTHER TRANSFERS OF
THIS SECURITY AND ANY SUCH SHARES TO REFLECT ANY CHANGE IN APPLICABLE LAW OR
REGULATION (OR THE INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO THE
RESALE OR TRANSFER OF RESTRICTED SECURITIES GENERALLY. THE HOLDER OF THIS
SECURITY AND ANY SUCH SHARES SHALL BE DEEMED BY THE ACCEPTANCE OF THIS SECURITY
AND ANY SUCH SHARES TO HAVE AGREED TO ANY SUCH AMENDMENT OR SUPPLEMENT.]

[THE FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH GLOBAL SECURITY:

                  THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITARY OR A NOMINEE OF THE DEPOSITARY, WHICH MAY BE TREATED BY THE COMPANY,
THE TRUSTEE AND ANY AGENT THEREOF AS OWNER AND HOLDER OF THIS SECURITY FOR ALL
PURPOSES.

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

                  UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
SECURITIES IN DEFINITIVE REGISTERED FORM IN THE LIMITED CIRCUMSTANCES REFERRED
TO IN THE INDENTURE, THIS GLOBAL SECURITY MAY NOT BE

                                       18
<PAGE>   26

TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY
OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR
A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.]

                                       19
<PAGE>   27

                       AFFILIATED COMPUTER SERVICES, INC.

                       3.50% CONVERTIBLE SUBORDINATED NOTE
                              DUE FEBRUARY 15, 2006

No.                  U.S.$
   ----------             -----
CUSIP NO. 008190AE0

                  AFFILIATED COMPUTER SERVICES, INC., a corporation duly
organized and existing under the laws of the State of Delaware (herein called
the "Company", which term includes any successor Person under the Indenture
referred to on the reverse hereof), for value received, hereby promises to pay
to _________________, or registered assigns, the principal sum of ________
United States Dollars (U.S.$______ ) (which principal amount may from time to
time be increased or decreased to such other principal amounts (which, taken
together with the principal amounts of all other Outstanding Securities, shall
not exceed $350,000,000 in the aggregate at any time) by adjustments made on the
records of the Trustee hereinafter referred to in accordance with the Indenture)
on February 15, 2006 and to pay interest thereon, from February 21, 2001, or
from the most recent Interest Payment Date (as defined below) to which interest
has been paid or duly provided for, semi-annually in arrears on February 15 and
August 15 in each year (each, an "Interest Payment Date"), commencing August 15,
2001, at the rate of 3.50% per annum, until the principal hereof is due, and at
the rate of 3.50% per annum on any overdue principal and premium, if any, and,
to the extent permitted by law, on any overdue interest. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will, as provided in the Indenture, be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest, which shall be the
February 1 or August 1 (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date. Except as otherwise provided in the
Indenture, any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Company, notice whereof shall be given to Holders of Securities not less than 10
days prior to the Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any automated quotation
system or securities exchange on which the Securities may be quoted or listed,
and upon such notice as may be required by such exchange, all as more fully
provided in the Indenture. Payments of principal shall be made upon the
surrender of this Security at the option of the Holder at the Corporate Trust
Office of the Trustee, or at such other office or agency of the Company as may
be designated by it for such purpose in the Borough of Manhattan, The City of
New York, in such coin or currency of the United States of America as at the
time of payment shall be legal tender for the payment of public and private
debts, or at such other offices or agencies as the Company may designate, by
United States Dollar check drawn on, or transfer to, a United States Dollar
account (such a transfer to be made only to a Holder of an aggregate principal
amount of

                                       20
<PAGE>   28

Securities in excess of U.S.$2,000,000, and only if such Holder shall have
furnished wire instructions in writing to the Trustee no later than 15 days
prior to the relevant payment date). Payment of interest on this Security may be
made by United States Dollar check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register, or, upon written
application by the Holder to the Security Registrar setting forth wire
instructions not later than the relevant Record Date, by transfer to a United
States Dollar account (such a transfer to be made only to a Holder of an
aggregate principal amount of Securities in excess of U.S. $2,000,000 and only
if such Holder shall have furnished wire instructions in writing to the Trustee
no later than 15 days prior to the relevant payment date).

                  Except as specifically provided herein and in the Indenture,
the Company shall not be required to make any payment with respect to any tax,
assessment or other governmental charge imposed by any government or any
political subdivision or taxing authority thereof or therein.

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

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

                  IN WITNESS WHEREOF, the Company has caused this Security to be
duly executed under its corporate seal.

                                            AFFILIATED COMPUTER SERVICES, INC.

[Corporate Seal]

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

Attest:

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

                                [FORM OF REVERSE]

                                       21
<PAGE>   29

                  This Security is one of a duly authorized issue of securities
of the Company designated as its "3.50% Convertible Subordinated Notes due
February 15, 2006" (herein called the "Securities"), limited in aggregate
principal amount to U.S. $350,000,000, issued and to be issued under an
Indenture, dated as of February 21, 2001 (herein called the "Indenture"),
between the Company and U.S. Trust Company of Texas, N.A., as Trustee (herein
called the "Trustee", which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights,
duties and immunities thereunder of the Company, the Trustee, the holders of
Senior Indebtedness and the Holders of the Securities and of the terms upon
which the Securities are, and are to be, authenticated and delivered. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities are exchangeable for a like aggregate principal amount of Securities
of any authorized denominations as requested by the Holder surrendering the same
upon surrender of the Security or Securities to be exchanged, at the Corporate
Trust Office of the Trustee. The Trustee upon such surrender by the Holder will
issue the new Securities in the requested denominations.

                  No sinking fund is provided for the Securities. The Securities
are subject to redemption at the option of the Company at any time on or after
February 18, 2004, in whole or in part, upon not less than 30 nor more than 60
days' notice to the Holders prior to the Redemption Date (such notice to be
promptly followed by public notice thereof by release made to Reuters Economic
Services and Bloomberg Business News) at the following Redemption Prices
(expressed as percentages of the principal amount) for the periods set forth
below:

<TABLE>
<CAPTION>
Year                                                          Redemption Price
----                                                          ----------------

<S>                                                           <C>
February 18, 2004 to February 14, 2005                        101.40%

February 15, 2005 to February 14, 2006                        100.70%
</TABLE>

and thereafter at a Redemption Price equal to 100% of the principal amount,
together, in each case, with accrued interest to the Redemption Date; provided,
however, that interest installments on Securities whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.

                  In the event of a redemption of the Securities, the Company
will not be required (a) to register the transfer or exchange of Securities for
a period of 15 days immediately preceding the date notice is given identifying
the serial numbers of the Securities called for such redemption or (b) to
register the transfer or exchange of any Security, or portion thereof, called
for redemption.

                  In any case where the due date for the payment of the
principal of, premium, if any, interest, or Liquidated Damages on any Security
or the last day on which a Holder of a

                                       22
<PAGE>   30

Security has a right to convert his Security shall be, at any Place of Payment
or Place of Conversion as the case may be, a day on which banking institutions
at such Place of Payment or Place of Conversion are authorized or obligated by
law or executive order to close, then payment of principal, premium, if any,
interest, or Liquidated Damages, or delivery for conversion of such Security
need not be made on or by such date at such place but may be made on or by the
next succeeding day at such place which is not a day on which banking
institutions are authorized or obligated by law or executive order to close,
with the same force and effect as if made on the date for such payment or the
date fixed for redemption or repurchase, or by such last day for conversion, and
no interest shall accrue on the amount so payable for the period after such
date.

                  Subject to and upon compliance with the provisions of the
Indenture, the Holder of this Security is entitled, at his option, at any time
on or before the close of business on February 15, 2006, or in case this
Security or a portion hereof is called for redemption or the Holder hereof has
exercised his right to require the Company to repurchase this Security or such
portion hereof, then in respect of this Security until and including, but
(unless the Company defaults in making the payment due upon redemption or
repurchase, as the case may be) not after, the close of business on the Business
Day prior to the Redemption Date or the Repurchase Date, as the case may be, to
convert this Security (or any portion of the principal amount hereof that is an
integral multiple of U.S. $1,000, provided that the unconverted portion of such
principal amount is U.S. $1,000 or any integral multiple of U.S. $1,000 in
excess thereof) into fully paid and nonassessable shares of Common Stock of the
Company at an initial Conversion Rate of 11.5117 shares of Common Stock for each
U.S. $1,000 principal amount of Securities (or at the current adjusted
Conversion Rate if an adjustment has been made as provided in the Indenture) by
surrender of this Security, duly endorsed or assigned to the Company or in blank
and, in case such surrender shall be made during the period from the close of
business on any Regular Record Date next preceding any Interest Payment Date to
the opening of business on such Interest Payment Date (except if this Security
or portion thereof has been called for redemption on a Redemption Date or is
repurchasable on a Repurchase Date occurring, in either case, during such period
and is surrendered for such conversion during such period (including any
Securities or portions thereof called for redemption on a

                                       23
<PAGE>   31

Redemption Date or submitted for repurchase on a Repurchase Date that is a
Regular Record Date or an Interest Payment Date, as the case may be)), also
accompanied by payment in New York Clearing House or other funds acceptable to
the Company of an amount equal to the interest payable on such Interest Payment
Date on the principal amount of this Security then being converted, and also the
conversion notice hereon duly executed, to the Company at the Corporate Trust
Office of the Trustee, or at such other office or agency of the Company, subject
to any laws or regulations applicable thereto and subject to the right of the
Company to terminate the appointment of any Conversion Agent (as defined below)
as may be designated by it for such purpose in the Borough of Manhattan, The
City of New York, or at such other offices or agencies as the Company may
designate (each a "Conversion Agent"), provided, further, that if this Security
or portion hereof has been called for redemption on a Redemption Date or is
repurchasable on a Repurchase Date occurring, in either case, during the period
from the close of business on any Regular Record Date next preceding any
Interest Payment Date to the opening of business on such succeeding Interest
Payment Date (including any Securities or portions thereof called for redemption
on a Redemption Date or submitted for repurchase on a Repurchase Date that is a
Regular Record Date or an Interest Payment Date, as the case may be) and is
surrendered for conversion during such period (or on the last Business Day prior
to the Regular Record Date or Interest Payment Date in case of any Security (or
portion thereof) called for redemption on a Redemption Date or submitted for
repurchase on a Repurchase Date on a Regular Record Date or Interest Payment
Date, as the case may be), then the Holder of this Security on such Regular
Record Date will be entitled to receive the interest accruing hereon from the
Interest Payment Date next preceding the date of such conversion to such
succeeding Interest Payment Date and the Holder of this Security who converts
this Security or a portion hereof during such period shall not be required to
pay such interest upon surrender of this Security for conversion. Subject to the
provisions of the preceding sentence and, in the case of a conversion after the
close of business on the Regular Record Date next preceding any Interest Payment
Date and on or before the close of business on such Interest Payment Date, to
the right of the Holder of this Security (or any Predecessor Security of record
as of such Regular Record Date) to receive the related installment of interest
to the extent and under the circumstances provided in the Indenture, no cash
payment or adjustment is to be made on conversion for interest accrued hereon
from the Interest Payment Date next preceding the day of conversion, or for
dividends on the Common Stock issued on conversion hereof. The Company shall
thereafter deliver to the Holder the fixed number of shares of Common Stock
(together with any cash adjustment, as provided in the Indenture) into which
this Security is convertible and such delivery will be deemed to satisfy the
Company's obligation to pay the principal amount of this Security. No fractions
of shares or scrip representing fractions of shares will be issued on
conversion, but instead of any fractional interest (calculated to the nearest
l/100th of a share) the Company shall pay a cash adjustment as provided in the
Indenture. The Conversion Rate is subject to adjustment as provided in the
Indenture. In addition, the Indenture provides that in case of certain
consolidations or mergers to which the Company is a party (other than a
consolidation or merger that does not result in any reclassification,
conversion, exchange or cancellation of the Common Stock) or the conveyance,
transfer, sale or lease of all or substantially all of the property and assets
of the Company, the Indenture shall be amended, without the consent of any
Holders of Securities, so that this Security, if then Outstanding, will be
convertible thereafter, during the period this Security shall be convertible as
specified above, only into the kind and amount of securities, cash and other
property receivable upon such consolidation, merger, conveyance, transfer, sale
or lease by a holder of the number of shares of Common Stock of the Company into
which this Security could have been converted immediately prior to such
consolidation, merger, conveyance, transfer, sale or lease (assuming such holder
of Common Stock is not a Constituent Person or an Affiliate of a Constituent
Person, failed to exercise any rights of election and received per share the
kind and amount received per share by a plurality of Non-electing Shares. No
adjustment in the Conversion Rate will be made until such adjustment would
require an increase or decrease of at least one percent of such rate, provided
that any adjustment that would otherwise be made will be carried forward and
taken into account in the computation of any subsequent adjustment.

                  If this Security is a Registrable Security (as defined in this
Indenture), then the Holder of this Security [IF THIS SECURITY IS A GLOBAL
SECURITY, THEN INSERT -- (including any Person that has a beneficial interest in
this Security)] and the Common Stock of the Company

                                       24
<PAGE>   32

issuable upon conversion hereof is entitled to the benefits of a Registration
Rights Agreement, dated as of February 21, 2001, executed by the Company (the
"Registration Rights Agreement"). Pursuant to the Registration Rights Agreement,
the Company has agreed for the benefit of the Holders from time to time of the
Registrable Securities that it will, at its expense, (a) within 90 days after
the Issue Date file a shelf registration statement (the "Shelf Registration
Statement") with the Commission with respect to resales of the Registrable
Securities, (b) use its reasonable efforts to cause such Shelf Registration
Statement to be declared effective by the Commission within 180 days after the
Issue Date of the Securities, provided, however, that the Company may, upon
written notice to all the Holders, postpone having the Shelf Registration
Statement declared effective for a reasonable period not to exceed 90 days if
the Company possesses material non-public information, the disclosure of which
would have a material adverse effect on the Company and its subsidiaries taken
as a whole, and (c) use its reasonable efforts to maintain such Shelf
Registration Statement effective under the Securities Act of 1933, as amended,
until the second annual anniversary of the date it is declared effective or such
earlier date as is provided in the Registration Rights Agreement (the
"Effectiveness Period"). The Company will be permitted to suspend the use of the
prospectus which is part of the Shelf Registration Statement during certain
periods of time as provided in the Registration Rights Agreement.

                  If (i) on or prior to 90 days following the Issue Date, a
Shelf Registration Statement has not been filed with the Commission, or (ii) on
or prior to the 180th day following the Issue Date, such Shelf Registration
Statement is not declared effective (each, a "Registration Default"), additional
interest ("Liquidated Damages") will accrue on this Restricted Security from and
including the day following such Registration Default to but excluding the day
on which such Registration Default has been cured. Liquidated Damages will be
paid semi-annually in arrears, with the first semi-annual payment due on the
first Interest Payment Date in respect of the Restricted Securities following
the date on which such Liquidated Damages begin to accrue, and will accrue at a
rate per annum equal to an additional one-quarter of one percent (0.25%) of the
principal amount of the Restricted Securities to and including the 90th day
following such Registration Default and at a rate per annum equal to one-half of
one percent (0.50%) thereof from and after the 91st day following such
Registration Default. Pursuant to the Registration Rights Agreement, in the
event that the Shelf Registration Statement ceases to be effective (or the
Holders of Registrable Securities are otherwise prevented or restricted by the
Company from effecting sales pursuant thereto) during the Effectiveness Period
for more than 30 days, whether or not consecutive, in any 90-day period, or 90
days, whether or not consecutive, during any 12-month period, then the interest
rate borne by the Restricted Securities shall increase by an additional one-half
of one percent (0.50%) per annum from the 31st day of the applicable 90-day
period or the 91st day of the applicable 12-month period, as the case may be,
that such Shelf Registration Statement ceases to be effective (or the Holders of
Registrable Securities are otherwise prevented or restricted by the Company from
effecting sales pursuant thereto) to but excluding the day on which (i) the
Shelf Registration Statement again becomes effective, (ii) the Holders of
Registrable Securities are no longer otherwise prevented or restricted by the
Company from effecting sales pursuant thereto or (iii) the Effectiveness Period
expires.

                                       25
<PAGE>   33

                  Whenever in this Security there is a reference, in any
context, to the payment of the principal of, premium, if any, or interest on, or
in respect of, any Security, such mention shall be deemed to include mention of
the payment of Liquidated Damages payable as described in the preceding
paragraph to the extent that, in such context, Liquidated Damages are, were or
would be payable in respect of such Security and express mention of the payment
of Liquidated Damages (if applicable) in any provisions of this Security shall
not be construed as excluding Liquidated Damages in those provisions of this
Security where such express mention is not made.

                  [If this Security is a Registrable Security and the Holder of
this Security [IF THIS SECURITY IS A GLOBAL SECURITY, THEN INSERT -- (including
any Person that has a beneficial interest in this Security)] elects to sell this
Security pursuant to the Shelf Registration Statement then, by its acceptance
hereof, such Holder of this Security agrees to be bound by the terms of the
Registration Rights Agreement relating to the Registrable Securities which are
the subject of such election.]

                  If a Change in Control occurs, the Holder of this Security, at
the Holder's option, shall have the right, in accordance with the provisions of
the Indenture, to require the Company to repurchase this Security (or any
portion of the principal amount hereof that is at least $1,000 or an integral
multiple of $1,000 in excess thereof, provided that the portion of the principal
amount of this Security to be Outstanding after such repurchase is at least
equal to U.S. $1,000) for cash at a Repurchase Price equal to 100% of the
principal amount thereof plus interest accrued to the Repurchase Date. At the
option of the Company, the Repurchase Price may be paid in cash or, subject to
the conditions provided in the Indenture, by delivery of shares of Common Stock
having a fair market value equal to the Repurchase Price. For purposes of this
paragraph, the fair market value of shares of Common Stock shall be determined
by the Company and shall be equal to 95% of the average of the Closing Prices
Per Share for the five consecutive Trading Days immediately preceding and
including the third Trading Day prior to the Repurchase Date. Whenever in this
Security there is a reference, in any context, to the principal of any Security
as of any time, such reference shall be deemed to include reference to the
Repurchase Price payable in respect of such Security to the extent that such
Repurchase Price is, was or would be so payable at such time, and express
mention of the Repurchase Price in any provision of this Security shall not be
construed as excluding the Repurchase Price so payable in those provisions of
this Security when such express mention is not made; provided, however, that,
for the purposes of the second succeeding paragraph, such reference shall be
deemed to include reference to the Repurchase Price only to the extent the
Repurchase Price is payable in cash.

                  [The following paragraph shall appear in each Global Security:

                  In the event of a deposit or withdrawal of an interest in this
Security, including an exchange, transfer, redemption, repurchase or conversion
of this Security in part only, the Trustee, as custodian of the Depositary,
shall make an adjustment on its records to reflect such deposit or withdrawal in
accordance with the Applicable Procedures.]

                                       26
<PAGE>   34

                  [The following paragraph shall appear in each Security that is
not a Global Security:

                  In the event of redemption, repurchase or conversion of this
Security in part only, a new Security or Securities for the unredeemed,
unrepurchased or unconverted portion hereof will be issued in the name of the
Holder hereof.]

                  The indebtedness evidenced by this Security is, to the extent
and in the manner provided in the Indenture, subordinate and subject in right of
payment to the prior payment in full of all Senior Indebtedness of the Company,
and this Security is issued subject to such provisions of the Indenture with
respect thereto. Each Holder of this Security, by accepting the same, (a) agrees
to and shall be bound by such provisions, (b) authorizes and directs the Trustee
on his behalf to take such action as may be necessary or appropriate to
effectuate the subordination so provided and (c) appoints the Trustee his
attorney-in-fact for any and all such purposes.

                  If an Event of Default shall occur and be continuing, the
principal of all the Securities, together with accrued interest to the date of
declaration, may be declared due and payable in the manner and with the effect
provided in the Indenture. Upon payment (i) of the amount of principal so
declared due and payable, together with accrued interest to the date of
declaration, and (ii) of interest on any overdue principal and, to the extent
permitted by applicable law, overdue interest, all of the Company's obligations
in respect of the payment of the principal of and interest on the Securities
shall terminate.

                  The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities under
the Indenture at any time by the Company and the Trustee with either (a) the
written consent of the Holders of not less than a majority in principal amount
of the Securities at the time Outstanding, or (b) by the adoption of a
resolution, at a meeting of Holders of the Outstanding Securities at which a
quorum is present, by the Holders of at least 66-2/3% in aggregate principal
amount of the Outstanding Securities represented and entitled to vote at such
meeting. The Indenture also contains provisions permitting the Holders of
specified percentages in principal amount of the Securities at the time
Outstanding, on behalf of the Holders of all the Securities, to waive compliance
by the Company with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such consent or waiver
by the Holder of this Security shall be conclusive and binding upon such Holder
and upon all future Holders of this Security and of any Security issued in
exchange herefore or in lieu hereof whether or not notation of such consent or
waiver is made upon this Security or such other Security.

                  As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default, the

                                       27
<PAGE>   35

Holders of not less than 25% in principal amount of the Outstanding Securities
shall have made written request to the Trustee to institute proceedings in
respect of such Event of Default as Trustee and offered the Trustee reasonable
indemnity and the Trustee shall not have received from the Holders of a majority
in principal amount of the Securities Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity. The foregoing
shall not apply to any suit instituted by the Holder of this Security for the
enforcement of any payment of principal hereof, premiums if any, or interest
(including Liquidated Damages) hereon on or after the respective due dates
expressed herein or for the enforcement of the right to convert this Security as
provided in the Indenture.

                  No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of, premium,
if any, and interest (including Liquidated Damages) on this Security at the
times, places and rate, and in the coin or currency, herein prescribed or to
convert this Security as provided in the Indenture.

                  As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registrable on
the Security Register upon surrender of this Security for registration of
transfer at the Corporate Trust Office of the Trustee or at such other office or
agency of the Company as may be designated by it for such purpose in the Borough
of Manhattan, The City of New York (which shall initially be an office or agency
of the Trustee), or at such other offices or agencies as the Company may
designate, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Company and the Security Registrar duly executed by,
the Holder thereof or his attorney duly authorized in writing, and thereupon one
or more new Securities, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees by
the Registrar. No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
recover any tax or other governmental charge payable in connection therewith.

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

                  No recourse for the payment of the principal (and premium, if
any) or interest on this Security and no recourse under or upon any obligation,
covenant or agreement of the Company in the Indenture or any indenture
supplemental thereto or in any Security, or because of the creation of any
indebtedness represented thereby, shall be had against any incorporator,
stockholder, employee, agent, officer or director or subsidiary, as such, past,
present or future, of the Company or of any successor corporation, either
directly or through the Company or any successor corporation, whether by virtue
of any constitution, statute or rule of law or by the

                                       28
<PAGE>   36

enforcement of any assessment or penalty or otherwise, all such liability being,
by the acceptance hereof and as part of consideration for the issue hereof,
expressly waived and released.

         THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, UNITED STATES OF AMERICA.

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

                                  ABBREVIATIONS

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

                  TEN COM - as tenants in common

                  TEN ENT - as tenants by the entireties

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

       UNIF GIFT MIN ACT -
                           -------------

         Custodian              under Uniform
                   ------------
                     (Minor)

         Gifts to Minors Act
                             -----------------
                                  (State)

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

                                       29
<PAGE>   37

                    ELECTION OF HOLDER TO REQUIRE REPURCHASE

                  (1) Pursuant to Article 14.1 of the Indenture, the undersigned
hereby elects to have this Security repurchased by the Company.

                  (2) The undersigned hereby directs the Trustee or the Company
to pay it or an amount in cash or, at the Company's election, Common Stock
valued as set forth in the Indenture, equal to 100% of the principal amount to
be repurchased (as set forth below), plus interest accrued to the Repurchase
Date, as provided in the Indenture.

                                    Dated:
                                           --------------------------------

                  --------------------------------------

                  --------------------------------------

                                    Signature(s)

                                    Signature(s) must be guaranteed by an
                                    Eligible Guarantor Institution with
                                    membership in an approved signature
                                    guarantee program pursuant to Rule 17Ad-15
                                    under the Securities Exchange Act of 1934.

                  --------------------------------------

                                                     Signature Guaranteed

Principal amount to be repurchased
 (at least U.S. $1,000 or an integral multiple $1,000 in excess thereof):

                        -------------------------------

Remaining principal amount following such repurchase
 (not less than U.S. $1,000):

                                           --------------------------------

NOTICE: The signature to the foregoing Election must correspond to the Name as
written upon the face of this Security in every particular, without alteration
or any change whatsoever.

                                       30
<PAGE>   38

SECTION 2.3       Form of Certificate of Authentication.

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

                  This is one of the Securities referred to in the
within-mentioned Indenture.

                                            U.S. Trust Company of Texas, N.A.,
                                            as Trustee

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

Dated:
       ---------------

SECTION 2.4       Form of Conversion Notice

                                CONVERSION NOTICE

                  The undersigned Holder of this Security hereby irrevocably
exercises the option to convert this Security, or any portion of the principal
amount hereof (which is U.S. $1,000 or an integral multiple of U.S. $1,000 in
excess thereof, provided that the unconverted portion of such principal amount
is U.S. $1,000 or any integral multiple of U.S. $1,000 in excess thereof) below
designated, into shares of Common Stock in accordance with the terms of the
Indenture referred to in this Security, and directs that such shares, together
with a check in payment for any fractional share and any Securities representing
any unconverted principal amount hereof, be delivered to and be registered in
the name of the undersigned unless a different name has been indicated below. If
shares of Common Stock or Securities are to be registered in the name of a
Person other than the undersigned, (a) the undersigned will pay all transfer
taxes payable with respect thereto and (b) signature(s) must be guaranteed by an
Eligible Guarantor Institution with membership in an approved signature
guarantee program pursuant to Rule 17Ad-15 under the Securities Exchange Act of
1934. Any amount required to be paid by the undersigned on account of interest
accompanies this Security.

Dated:
       ------------------------

                  -----------------------------------------

                                        Signature(s)

                                       31
<PAGE>   39

<TABLE>
<S>                                                  <C>
If shares or Securities are to be registered in      If only a portion of the Securities is to be
the name of a Person other than the Holder,          converted, please indicate:
please print such Person's name and
address:                                             1.       Principal amount to be converted:

                                                                                  U.S. $
-----------------------------------------                                               ----------
         Name                                        2.       Principal amount and denomination
                                                              of Securities representing
                                                              unconverted principal amount to be
-----------------------------------------                     issued:
         Address

                                                                           Amount U.S. $
                                                                                        ----------
-----------------------------------------            (U.S. $1,000 or any integral multiple of U.S.
Social Security or other Identification              $1,000 in excess thereof, provided that the
Number, if any                                       unconverted portion of such principal
                                                     amount is U.S. $1,000 or any integral
                                                     multiple of U.S. $1,000 in excess thereof)

-----------------------------------------
[Signature Guaranteed]
</TABLE>

                                       32
<PAGE>   40

SECTION 2.5       Form of Assignment.

                  For value received ________________ hereby sell(s), assign(s)
and transfer(s) unto ________________ (Please insert social security or other
identifying number of assignee) the within Security, and hereby irrevocably
constitutes and appoints ____________________as attorney to transfer the said
Security on the books of the Company, with full power of substitution in the
premises.

Dated:

                  -------------------------------

                  -------------------------------

                                    Signature(s)

                                    Signature(s) must be guaranteed by an
                                    Eligible Guarantor Institution with
                                    membership in an approved signature
                                    guarantee program pursuant to Rule 17Ad - 15
                                    under the Securities Exchange Act of 1934.

                                       33
<PAGE>   41

                                  ARTICLE III
                                 THE SECURITIES

SECTION 3.1       Title and Terms.

                  The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is limited to U.S.
$350,000,000, except for Securities authenticated and delivered pursuant to
Section 3.4, 3.5, 3.6, 8.5, 12.2 or 14.3(5) in exchange for, or in lieu of,
other Securities previously authenticated and delivered under this Indenture

                  The Securities shall be known and designated as the "3.50%
Convertible Subordinated Notes due February 15, 2006" of the Company. Their
Stated Maturity shall be February 15, 2006 and they shall bear interest on their
principal amount from February 21, 2001, payable semi-annually in arrears on
February 15 and August 15 in each year, commencing August 15, 2001, at the rate
of 3.50% per annum until the principal thereof is due and at the rate of 3.50%
per annum on any overdue principal and, to the extent permitted by law, on any
overdue interest; provided, however, that payments shall only be made on a
Business Day as provided in Section 1.12.

                  The principal of, premium, if any, and interest on the
Securities shall be payable as provided in the form of Securities set forth in
Section 2.2, and the Repurchase Price, whether payable in cash or in shares of
Common Stock, shall be payable at such places as are identified in the Company
Notice given pursuant to Section 14.3 (any city in which any Paying Agent is
located being herein called a "Place of Payment").

                  The Registrable Securities are entitled to the benefits of a
Registration Rights Agreement as provided by Section 10.11 and in the form of
Security set forth in Section 2.2. The Securities are entitled to the payment of
Liquidated Damages as provided by Section 10.11.

                  The Securities shall be redeemable at the option of the
Company at any time on or after February 18, 2004, in whole or in part, as
provided in Article XI and in the form of Security set forth in Section 2.2.

                  The Securities shall be convertible as provided in Article XII
(any city in which any Conversion Agent is located being herein called a "Place
of Conversion").

                  The Securities shall be subordinated in right of payment to
Senior Indebtedness of the Company as provided in Article XIII.

                  The Securities shall be subject to repurchase by the Company
at the option of the Holders as provided in Article XIV.

                                       34
<PAGE>   42

SECTION 3.2       Denominations.

                  The Securities shall be issuable only in registered form,
without coupons, in denominations of U.S. $1,000 and integral multiples of U.S.
$1,000 in excess thereof.

SECTION 3.3       Execution, Authentication, Delivery and Dating.

                  The Securities shall be executed on behalf of the Company by
its Chairman of the Board, its Vice Chairman of the Board, its Chief Executive
Officer, its President, one of its Executive Vice Presidents or one of its Vice
Presidents, under a facsimile of its corporate seal reproduced thereon attested
by its Chief Financial Officer, Secretary or one of its Assistant Secretaries.
Any such signature may be manual or facsimile.

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

                  At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities executed by the
Company to the Trustee or to its order for authentication, together with a
Company Order for the authentication and delivery of such Securities, and the
Trustee in accordance with such Company Order shall authenticate and make
available for delivery such Securities as in this Indenture provided.

                  Each Security shall be dated the date of its authentication.

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

SECTION 3.4       Global Securities; Non-Global Securities; Book-Entry
                  Provisions.

                  (1) Global Securities

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

                           (ii) Except for exchanges of Global Securities for
definitive, non-Global Securities at the sole discretion of the Company, no
Global Security may be exchanged in whole or in part for Securities registered,
and no transfer of a Global Security in whole or in part may be registered, in
the name of any Person other than the Depositary for such Global Security

                                       35
<PAGE>   43

or a nominee thereof unless (A) such Depositary (i) has notified the Company
that it is unwilling or unable to continue as Depositary for such Global
Security or (ii) has ceased to be a clearing agency registered as such under the
Exchange Act or announces an intention permanently to cease business or does in
fact do so or (B) there shall have occurred and be continuing an Event of
Default with respect to such Global Security. In such event, if a successor
Depositary for such Global Security is not appointed by the Company within 90
days after the Company receives such notice or becomes aware of such
ineligibility, the Company will execute, and the Trustee, upon receipt of an
Officers' Certificate directing the authentication and delivery of Securities,
will authenticate and deliver, Securities, in any authorized denominations in an
aggregate principal amount equal to the principal amount of such Global Security
in exchange for such Global Security.

                           (iii) If any Global Security is to be exchanged for
other Securities or canceled in whole, it shall be surrendered by or on behalf
of the Depositary or its nominee to the Trustee, as Security Registrar, for
exchange or cancellation, as provided in this Article III. If any Global
Security is to be exchanged for other Securities or canceled in part, or if
another Security is to be exchanged in whole or in part for a beneficial
interest in any Global Security, in each case, as provided in Section 3.5, then
either (A) such Global Security shall be so surrendered for exchange or
cancellation, as provided in this Article III, or (B) the principal amount
thereof shall be reduced or increased by an amount equal to the portion thereof
to be so exchanged or canceled, or equal to the principal amount of such other
Security to be so exchanged for a beneficial interest therein, as the case may
be, by means of an appropriate adjustment made on the records of the Trustee, as
Security Registrar, whereupon the Trustee, in accordance with the Applicable
Procedures, shall instruct the Depositary or its authorized representative to
make a corresponding adjustment to its records. Upon any such surrender or
adjustment of a Global Security, the Trustee shall, subject to Section 3.5(3)
and as otherwise provided in this Article III, authenticate and deliver any
Securities issuable in exchange for such Global Security (or any portion
thereof) to or upon the order of, and registered in such names as may be
directed by, the Depositary or its authorized representative. Upon the request
of the Trustee in connection with the occurrence of any of the events specified
in the preceding paragraph, the Company shall promptly make available to the
Trustee a reasonable supply of Securities that are not in the form of Global
Securities. The Trustee shall be entitled to rely upon any order, direction or
request of the Depositary or its authorized representative which is given or
made pursuant to this Article III if such order, direction or request is given
or made in accordance with the Applicable Procedures.

                           (iv) Every Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global Security
or any portion thereof, whether pursuant to this Article III or otherwise, shall
be authenticated and delivered in the form of, and shall be, a registered Global
Security, unless such Security is registered in the name of a Person other than
the Depositary for such Global Security or a nominee thereof, in which case such
Security shall be authenticated and delivered in definitive, fully registered
form, without interest coupons.

                                       36
<PAGE>   44

                           (v) The Depositary or its nominee, as registered
owner of a Global Security, shall be the Holder of such Global Security for all
purposes under the Indenture and the Securities, and owners of beneficial
interests in a Global Security shall hold such interests pursuant to the
Applicable Procedures. Accordingly, any such owner's beneficial interest in a
Global Security will be shown only on, and the transfer of such interest shall
be effected only through, records maintained by the Depositary or its nominee or
its Agent Members and such owners of beneficial interests in a Global Security
will not be considered the owners or holders thereof.

                  (2) Non-Global Securities. Securities issued upon the events
described in Section 3.4(l)(ii) shall be in definitive, fully registered form,
without interest coupons, and shall bear the Restricted Securities Legend as
required by this Indenture.

SECTION 3.5       Registration; Registration of Transfer and Exchange;
                  Restrictions on Transfer.

                  (1) The Company shall cause to be kept at the Corporate Trust
Office of the Trustee a register (the register maintained in such office
referred to as the "Security Register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
of Securities and of transfers of Securities. The Trustee is hereby appointed
"Security Registrar" for the purpose of registering Securities and transfers and
exchanges of Securities as herein provided.

                  Upon surrender for registration of transfer of any Security at
an office or agency of the Company designated pursuant to Section 10.2 for such
purpose, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of any authorized denominations and of a like aggregate principal
amount and bearing such restrictive legends as may be required by this
Indenture.

                  At the option of the Holder, and subject to the other
provisions of this Section 3.5, Securities may be exchanged for other Securities
of any authorized denomination and of a like aggregate principal amount, upon
surrender of the Securities to be exchanged at any such office or agency.
Whenever any Securities are so surrendered for exchange, and subject to the
other provisions of this Section 3.5, the Company shall execute, and the Trustee
shall authenticate and deliver, the Securities which the Holder making the
exchange is entitled to receive. Every Security presented or surrendered for
registration of transfer or for exchange shall (if so required by the Company or
the Security Registrar) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Company, the Trustee and the
Security Registrar duly executed, by the Holder thereof or his attorney duly
authorized in writing.

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

                                       37
<PAGE>   45

                  No service charge shall be made to a Holder for any
registration of transfer or exchange of Securities except as provided in Section
3.6, but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Securities, other than exchanges
pursuant to Section 3.4, 8.5, 12.2 or 14.3 (other than where the shares of
Common Stock are to be issued or delivered in a name other than that of the
Holder of the Security) not involving any transfer and other than any stamp and
other duties, if any, which may be imposed in connection with any such transfer
or exchange by the United States or any political subdivision thereof or
therein, which shall be paid by the Company.

                  In the event of a redemption of the Securities, neither the
Company nor the Securities Registrar will be required (a) to register the
transfer of or exchange Securities for a period of 15 days immediately preceding
the date notice is given identifying the serial numbers of the Securities called
for such redemption or (b) to register the transfer of or exchange any Security,
or portion thereof, called for redemption.

                  (2) Certain Transfers and Exchanges. Notwithstanding any other
provision of this Indenture or the Securities, transfers and exchanges of
Securities and beneficial interests in a Global Security of the kinds specified
in this Section 3.5(2) shall be made only in accordance with this Section
3.5(2).

                  (i) Restricted Global Security to Restricted Non-Global
Security. In the event that non-Global Securities are to be issued pursuant to
Section 3.4(1)(ii) in connection with any transfer of Securities, such transfer
may be effected only in accordance with the provisions of this Clause (2)(i) and
subject to the Applicable Procedures. Upon receipt by the Trustee, as Security
Registrar, of (A) a Company Order from the Company directing the Trustee, as
Security Registrar, to (x) authenticate and deliver one or more Securities of
the same aggregate principal amount as the beneficial interest in the Restricted
Global Security to be transferred, such instructions to contain the name or
names of the designated transferee or transferees, the authorized denomination
or denominations of the Securities to be so issued and appropriate delivery
instructions and (y) decrease the beneficial interest of a specified Agent
Member's account in a Restricted Global Security by a specified principal amount
not greater than the principal amount of such Restricted Global Security, and
(B) such other certifications, legal opinions or other information as the
Company or the Trustee may reasonably require to confirm that such transfer is
being made pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act, then the Trustee, as
Security Registrar, shall decrease the principal amount of the Restricted Global
Security by the specified amount and authenticate and deliver Securities in
accordance with such instructions from the Company as provided in Section
3.4(1)(iii).

                  (ii) Restricted Non-Global Security to Restricted Global
Security. If the Holder of a Restricted Security (other than a Global Security)
wishes at any time to transfer all or any portion of such Restricted Security to
a Person who wishes to take delivery thereof in the form of a beneficial
interest in the Restricted Global Security, such transfer may be effected only

                                       38
<PAGE>   46

in accordance with the provisions of this Clause (2)(ii) and subject to the
Applicable Procedures. Upon receipt by the Trustee, as Security Registrar, of
(A) such Restricted Security as provided in Section 3.5(1) and instructions from
the Company directing that a beneficial interest in the Restricted Global
Security in a specified principal amount not greater than the principal amount
of such Security be credited to a specified Agent Member's account and (B) a
Restricted Securities Certificate, satisfactory to the Trustee and duly executed
by such Holder or his attorney duly authorized in writing, then the Trustee, as
Security Registrar, shall cancel such Restricted Security (and issue a new
Restricted Security in respect of any untransferred portion thereof) as provided
in Section 3.5(1) and increase the principal amount of the Restricted Global
Security by the specified principal amount as provided in Section 3.4(1)(iii).

                  (iii) Exchanges between Global Security and Non-Global
Security. A beneficial interest in a Global Security may be exchanged for a
Security that is not a Global Security only as provided in Section 3.4 or only
if such exchange occurs in connection with a transfer effected in accordance
with Clause 2(i) above, provided that, if such interest is a beneficial interest
in the Restricted Global Security, then such interest shall be exchanged for a
Restricted Security (subject in each case to Section 3.5(3)). A Security that is
not a Global Security may be exchanged for a beneficial interest in a Global
Security only if such exchange occurs in connection with a transfer effected in
accordance with Clause (2)(ii) above.

                  (3) Securities Act Legends. All Securities issued pursuant to
this Indenture, and all Successor Securities, shall bear the Restricted
Securities Legend, subject to the following:

                  (i) subject to the following Clauses of this Section 3.5(3), a
Security or any portion thereof which is exchanged, upon transfer or otherwise,
for a Global Security or any portion thereof shall bear the Restricted
Securities Legend borne by such Global Security for which the Security was
exchanged;

                  (ii) subject to the following Clauses of this Section 3.5(3),
a new Security which is not a Global Security and is issued in exchange for
another Security (including a Global Security) or any portion thereof, upon
transfer or otherwise, shall bear the Restricted Securities Legend for which the
Security was exchanged;

                  (iii) any Securities which are sold or otherwise disposed of
pursuant to an effective registration statement under the Securities Act
(including the Shelf Registration Statement), together with their Successor
Securities shall not bear a Restricted Securities Legend; the Company shall
inform the Trustee in writing of the effective date of any such registration
statement registering the Securities under the Securities Act and shall notify
the Trustee at any time when prospectuses must be delivered with respect to
Securities to be sold pursuant to such registration statement. The Trustee shall
not be liable for any action taken or omitted to be taken by it in good faith in
accordance with the aforementioned registration statement;

                  (iv) at any time after the Securities may be freely
transferred without registration under the Securities Act or without being
subject to transfer restrictions pursuant to

                                       39
<PAGE>   47

the Securities Act, a new Security which does not bear a Restricted Securities
Legend may be issued in exchange for or in lieu of a Security (other than a
Global Security) or any portion thereof which bears such a legend if the Trustee
has received an Unrestricted Securities Certificate, satisfactory to the Trustee
and duly executed by the Holder of such Security bearing a Restricted Securities
Legend or his attorney duly authorized in writing, and after such date and
receipt of such certificate, the Trustee shall authenticate and deliver such new
Security in exchange for or in lieu of such other Security as provided in this
Article III;

                  (v) a new Security which does not bear a Restricted Securities
Legend may be issued in exchange for or in lieu of a Security (other than a
Global Security) or any portion thereof which bears such a legend if, in the
Company's judgment, placing such a legend upon such new Security is not
necessary to ensure compliance with the registration requirements of the
Securities Act, and the Trustee, at the direction of the Company, shall
authenticate and deliver such a new Security as provided in this Article III;
and

                  (vi) notwithstanding the foregoing provisions of this Section
3.5(3), a Successor Security of a Security that does not bear a Restricted
Securities Legend shall not bear such legend unless the Company has reasonable
cause to believe that such Successor Security is a "restricted security" within
the meaning of Rule 144, in which case the Trustee, at the direction of the
Company, shall authenticate and deliver a new Security bearing a Restricted
Securities Legend in exchange for such Successor Security as provided in this
Article III.

                  (4) Any stock certificate representing shares of Common Stock
issued upon conversion of the Securities shall bear the Restricted Securities
Legend borne by such Securities, to the extent required by this Indenture,
unless such shares of Common Stock have been sold pursuant to a registration
statement that has been declared effective under the Securities Act (and which
continues to be effective at the time of such transfer) or sold pursuant to Rule
144(k) of the Securities Act, or unless otherwise agreed by the Company in
writing with written notice thereof to the transfer agent for the Common Stock.
With respect to the transfer of shares of Common Stock issued upon conversion of
the Securities that are restricted hereunder, any deliveries of certificates,
legal opinions or other instruments that would be required to be made to the
Security Registrar in the case of a transfer of Securities, as described above,
shall instead be made to the transfer agent for the Common Stock.

                  (5) Neither the Trustee, the Paying Agent nor any of their
agents shall (i) have any duty to monitor compliance with or with respect to any
federal or state or other securities or tax laws or (ii) have any duty to obtain
documentation on any transfers or exchanges other than as specifically required
hereunder.

SECTION 3.6       Mutilated, Destroyed, Lost or Stolen Securities.

                  If any mutilated Security is surrendered to the Trustee, the
Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of like tenor and principal amount and bearing a number
not contemporaneously outstanding.

                                       40
<PAGE>   48

                  If there be delivered to the Company and to the Trustee:

                  (1) evidence to their satisfaction of the destruction, loss or
theft of any Security, and

                  (2) such security or indemnity as may be satisfactory to the
Company and the Trustee to save each of them and any agent of either of them
harmless, then, in the absence of actual notice to the Company or the Trustee
that such Security has been acquired by a bona fide purchaser, the Company shall
execute and the Trustee shall authenticate and deliver, in lieu of any such
destroyed, lost or stolen Security, a new Security of like tenor and principal
amount and bearing a number not contemporaneously outstanding.

                  In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion,
but subject to any conversion rights, may, instead of issuing a new Security,
pay such Security, upon satisfaction of the conditions set forth in the
preceding paragraph.

                  Upon the issuance of any new Security under this Section 3.6,
the Company may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto (other than
any stamp and other duties, if any, which may be imposed in connection therewith
by the United States or any political subdivision thereof or therein, which
shall be paid by the Company) and any other expenses (including the fees and
expenses of the Trustee) connected therewith.

                  Every new Security issued pursuant to this Section 3.6 in lieu
of any mutilated, destroyed, lost or stolen Security shall constitute an
original additional contractual obligation of the Company, whether or not the
mutilated, destroyed, lost or stolen Security shall be at any time enforceable
by anyone, and such new Security shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Securities duly
issued hereunder.

                  The provisions of this Section 3.6 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies of any Holder with
respect to the replacement or payment of mutilated, destroyed, lost or stolen
Securities.

SECTION 3.7       Payment of Interest; Interest Rights Preserved.

                  Interest on any Security which is payable, and is punctually
paid or duly provided for, on any Interest Payment Date shall be paid to the
Person in whose name that Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest.

                  Any interest on any Security which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been

                                       41
<PAGE>   49

such Holder, and such Defaulted Interest may be paid by the Company, at its
election in each case, as provided in Clause (1) or (2) below:

                  (1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities (or their respective
Predecessor Securities) are registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest, which shall be fixed in
the following manner. The Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each Security, the date of
the proposed payment and the Special Record Date, and at the same time the
Company shall deposit with the Trustee an amount of money equal to the aggregate
amount proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date of
the proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this Clause
provided. The Special Record Date for the payment of such Defaulted Interest
shall be not more than 15 days and not less than 10 days prior to the date of
the proposed payment and not less than 10 days after the receipt by the Trustee
of the notice of the proposed payment. The Trustee, in the name and at the
expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be mailed,
first-class postage prepaid, to each Holder at such Holder's address as it
appears in the Security Register, not less than 10 days prior to such Special
Record Date. Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been so mailed, such Defaulted Interest
shall be paid to the Persons in whose names the Securities (or their respective
Predecessor Securities) are registered at the close of business on such Special
Record Date and shall no longer be payable pursuant to the following Clause (2).

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

                  Subject to the foregoing provisions of this Section and
Section 3.5, each Security delivered under this Indenture upon registration of
transfer of or in exchange for or in lieu of any other Security shall carry the
rights to interest accrued and unpaid, and to accrue, which were carried by such
other Security.

                  Interest on any Security which is converted in accordance with
Section 12.2 during a Record Date Period shall be payable in accordance with the
provisions of Section 12.2.

SECTION 3.8       Persons Deemed Owners.

                  Prior to due presentment of a Security for registration of
transfer, the Company, the Trustee, any Paying Agent and any agent of the
Company, the Trustee or any Paying Agent may treat the Person in whose name such
Security is registered as the owner of such Security for the purpose of
receiving payment of principal of, premium, if any, and (subject to Section 3.7)

                                       42
<PAGE>   50

interest on such Security and for all other purposes whatsoever, whether or not
such Security be overdue, and neither the Company, the Trustee, any Paying Agent
nor any agent of the Company, the Trustee or any Paying Agent shall be affected
by notice to the contrary.

SECTION 3.9       Cancellation.

                  All Securities surrendered for payment, redemption,
repurchase, registration of transfer or exchange or conversion shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee.
All Securities so delivered to the Trustee shall be canceled promptly by the
Trustee (or its agent). No Securities shall be authenticated in lieu of or in
exchange for any Securities canceled as provided in this Section 3.9. The
Trustee shall dispose of all canceled Securities in accordance with applicable
law and its customary practices in effect from time to time.

SECTION 3.10      Computation of Interest.

                  Interest on the Securities (including any Liquidated Damages)
shall be computed on the basis of a 360-day year of twelve 30-day months.

SECTION 3.11      CUSIP Numbers.

                  The Company in issuing Securities may use "CUSIP" numbers (if
then generally in use) in addition to serial numbers; if so, the Trustee shall
use such CUSIP numbers in addition to serial numbers in notices of redemption
and repurchase as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such CUSIP numbers
either as printed on the Securities or as contained in any notice of a
redemption or repurchase and that reliance may be placed only on the serial or
other identification numbers printed on the Securities, and any such redemption
or repurchase shall not be affected by any defect in or omission of such CUSIP
numbers.

                                   ARTICLE IV
                           SATISFACTION AND DISCHARGE

SECTION 4.1       Satisfaction and Discharge of Indenture.

                  This Indenture shall upon Company Request cease to be of
further effect (except as to any surviving rights of conversion, or registration
of transfer or exchange, or replacement of Securities herein expressly provided
for and any right to receive Liquidated Damages as provided in Section 10.11 and
in the form of Securities set forth in Section 2.2 and the Company's obligations
to the Trustee pursuant to Section 6.7), and the Trustee, at the expense of the
Company, shall execute proper instruments in form and substance satisfactory to
the Trustee acknowledging satisfaction and discharge of this Indenture, when

                  (1) either

                                       43
<PAGE>   51

                  (i) all Securities theretofore authenticated and delivered
(other than (A) Securities which have been destroyed, lost or stolen and which
have been replaced or paid as provided in Section 3.6 and (B) Securities for
whose payment money has theretofore been deposited in trust or segregated and
held in trust by the Company and thereafter repaid to the Company or discharged
from such trust, as provided in Section 10.3) have been delivered to the Trustee
for cancellation; or

                  (ii) all such Securities not theretofore delivered to the
Trustee or its agent for cancellation (other than Securities referred to in
clauses (A) and (B) of clause (l)(i) above)

                           (a)      have become due and payable, or

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

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

and the Company, in the case of clause (a), (b) or (c) above, has deposited or
caused to be deposited with the Trustee as trust funds (immediately available to
the Holders in the case of clause (a)) in trust for the purpose an amount in
cash sufficient to pay and discharge the entire indebtedness on such Securities
not theretofore delivered to the Trustee for cancellation, for principal,
premium, if any, and interest (including any Liquidated Damages) to the date of
such deposit (in the case of Securities which have become due and payable) or to
the Stated Maturity or Redemption Date, as the case may be;

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

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

                  Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company to the Trustee under Section 6.7, the
obligations of the Company to any Authenticating Agent under Section 6.12, the
obligation of the Company to pay Liquidated Damages, if money shall have been
deposited with the Trustee pursuant to clause (l)(ii) of this Section 4.1, the
obligations of the Trustee under Section 4.2 and the last paragraph of Section
10.3 and the obligations of the Company and the Trustee under Section 3.5 and
Article XII shall survive. Funds held in trust pursuant to this Section are not
subject to the provisions of Article XIII.

                                       44
<PAGE>   52

SECTION 4.2       Application of Trust Money.

                  Subject to the provisions of the last paragraph of Section
10.3, all money deposited with the Trustee pursuant to Section 4.1 and in
accordance with the provisions of Article XIII shall be held in trust for the
sole benefit of the Holders and not be subject to the subordination provisions
of Article XIII, and such monies shall be applied by the Trustee, in accordance
with the provisions of the Securities and this Indenture, to the payment, either
directly or through any Paying Agent, to the Persons entitled thereto, of the
principal, premium, if any, and interest for whose payment such money has been
deposited with the Trustee.

                  All moneys deposited with the Trustee pursuant to Section 4.1
(and held by it or any Paying Agent) for the payment of Securities subsequently
converted shall be returned to the Company upon Company Request.

                  The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed or assessed against all money deposited with
the Trustee pursuant to Section 4.1 (other than income taxes and franchise taxes
incurred or payable by the Trustee and such other taxes, fees or charges
incurred or payable by the Trustee that are not directly the result of the
deposit of such money with the Trustee).

                                   ARTICLE V
                                    REMEDIES

SECTION 5.1       Events of Default.

                  "Event of Default", wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be occasioned by the provisions of Article XIII or be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):

                  (1) default in the payment of the principal of or premium, if
any, on any Security at its Maturity, whether or not such payment is prohibited
by the subordination provisions of the Securities or of this Indenture; or

                  (2) default in the payment of any interest (including any
Liquidated Damages) upon any Security when it becomes due and payable, and
continuance of such default for a period of 30 days, whether or not such payment
is prohibited by the subordination provisions of the Securities or of this
Indenture; or

                  (3) failure by the Company to give a Company Notice in
accordance with Section 14.3, whether or not such payment is prohibited by the
subordination provisions of the Securities or of this Indenture; or

                                       45
<PAGE>   53

                  (4) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture (other than a covenant or warranty a
default in the performance or breach of which is specifically dealt with
elsewhere in this Section), and continuance of such default or breach for a
period of 60 days after there has been given, by registered or certified mail,
to the Company by the Trustee or to the Company and the Trustee by the Holders
of at least 25% in principal amount of the Outstanding Securities a written
notice specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default;" or

                  (5) any indebtedness under any bonds, debentures, notes or
other evidences of indebtedness for money borrowed by the Company or under any
mortgage, indenture or instrument under which there may be issued or by which
there may be secured or evidenced any indebtedness for money borrowed by the
Company (an "Instrument"), or any guaranty by the Company for indebtedness for
money borrowed by any Subsidiary of the Company, with a principal amount then
outstanding in excess of U.S. $25,000,000, whether such indebtedness now exists
or shall hereafter be created, is not paid at final maturity of any Instrument
(either at its stated maturity or upon acceleration thereof), and such
indebtedness is not discharged, or such acceleration is not rescinded or
annulled, within a period of 30 days after there shall have been given, by
registered or certified mail, to the Company by the Trustee or to the Company
and the Trustee by the Holders of at least 25% in principal amount of the
Outstanding Securities a written notice specifying such default and requiring
the Company to cause such indebtedness to be discharged or cause such default to
be cured or waived or such acceleration to be rescinded or annulled and stating
that such notice is a "Notice of Default" hereunder; or

                  (6) the entry by a court having jurisdiction in the premises
of (A) a decree or order for relief in respect of the Company in an involuntary
case or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in respect
of the company under any applicable Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or of any substantial part of its property, or
ordering the winding up or liquidation of its affairs, and the continuance of
any such decree or order for relief or any such other decree or order unstayed
and in effect for a period of 60 consecutive days; or

                  (7) the commencement by the Company of a voluntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to be
adjudicated a bankrupt or insolvent, or the consent by it to the entry of a
decree or order for relief in respect of the Company in an involuntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any bankruptcy or
insolvency case or proceeding against it, or the filing by it of a petition or
answer or consent seeking reorganization or similar relief under any applicable
Federal or State law, or the consent by it to the filing of such petition or to
the appointment of or taking possession by a custodian, receiver, liquidator,
assignee, trustee,

                                       46
<PAGE>   54

sequestrator or other similar official of the Company or of any substantial part
of its property, or the making by it of an assignment for the benefit of
creditors, or the admission by it in writing of its inability to pay its debts
generally as they become due, or the taking of corporate action by the Company
in furtherance of any such action.

SECTION 5.2       Acceleration of Maturity; Rescission and Annulment.

                  If an Event of Default (other than an Event of Default
specified in Section 5.1(6) or 5.1 (7)) occurs and is continuing, then in every
such case the Trustee or the Holders of not less than 25% in principal amount of
the Outstanding Securities may, subject to the provisions of Article XIII,
declare the principal of all the Securities to be due and payable immediately,
by a notice in writing to the Company (and to the Trustee if given by the
Holders), and upon any such declaration such principal and all accrued interest
thereon shall become immediately due and payable. If an Event of Default
specified in Section 5.1(6) or 5.1(7) occurs, the principal of, and accrued
interest on, all the Securities shall, subject to the provisions of Article
XIII, ipso facto become immediately due and payable without any declaration or
other Act of the Holders or any act on the part of the Trustee.

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

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

                  (i) all overdue interest on all Securities,

                  (ii) the principal of and premium, if any, on any Securities
which have become due otherwise than by such declaration of acceleration and any
interest thereon at the rate borne by the Securities,

                  (iii) to the extent permitted by applicable law, interest upon
overdue interest at a rate of 3.50% per annum, and

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

                  (2) all Events of Default, other than the nonpayment of the
principal of and any premium and interest on, Securities which have become due
solely by such declaration of acceleration, have been cured or waived as
provided in Section 5.13; and

                                       47
<PAGE>   55

                  (3) such rescission and annulment would not conflict with any
judgment or decree issued in appropriate judicial proceedings regarding the
payment by the Trustee to the Holders of the amounts referred to in 5.2(1).

                  No rescission or annulment referred to above shall affect any
subsequent default or impair any right consequent thereon.

SECTION 5.3       Collection of Indebtedness and Suits for Enforcement by
                  Trustee.

                  The Company covenants that if:

                  (1) default is made in the payment of any interest (including
any Liquidated Damages) on any Security when it becomes due and payable and such
default continues for a period of 30 days, or

                  (2) default is made in the payment of the principal of or
premium, if any, on any Security at the Maturity thereof, the Company will, upon
demand of the Trustee but subject to the provisions of Article XIII pay to it,
for the benefit of the Holders of such Securities the whole amount then due and
payable on such Securities for principal and interest (including any Liquidated
Damages) and interest on any overdue principal and premium, if any, and, to the
extent permitted by applicable law, on any overdue interest (including any
Liquidated Damages), at a rate of 3.50% per annum, and in addition thereto, such
further amount as shall be sufficient to cover the reasonable costs and expenses
of collection, including the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel.

                  If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, may prosecute such proceeding to judgment or final decree and may
enforce the same against the Company or any other obligor upon the Securities
and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon the
Securities, wherever situated.

                  If an Event of Default occurs and is continuing, the Trustee
may in its discretion proceed to protect and enforce its rights and the rights
of the Holders of Securities by such appropriate judicial proceedings as the
Trustee shall deem most effectual to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in this
Indenture or in aid of the exercise of any power granted herein, or to enforce
any other proper remedy.

SECTION 5.4       Trustee May File Proofs of Claim.

                  In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such

                                       48
<PAGE>   56

other obligor or the creditors of either, the Trustee (irrespective of whether
the principal of, and any interest on, the Securities shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand on the Company for the payment of
overdue principal or interest) shall be entitled and empowered, by intervention
in such proceeding or otherwise,

                  (1) to file and prove a claim for the whole amount of
principal, premium, if any, and interest owing and unpaid in respect of the
Securities and take such other actions, including participating as a member,
voting or otherwise, of any official committee of creditors appointed in such
matter, and to file such other papers or documents, in each of the foregoing
cases, as may be necessary or advisable in order 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 of the
Holders of Securities allowed in such judicial proceeding, and

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

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder of Securities 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 of Securities 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 6.7.

                  Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder of
a Security 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 of a Security in any such
proceeding; provided, however, that the Trustee may, on behalf of such Holders,
vote for the election of a trustee in bankruptcy or similar official.

SECTION 5.5       Trustee May Enforce Claims Without Possession of Securities.

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

SECTION 5.6       Application of Money Collected.

                  Subject to Article XIII, any money collected by the Trustee
pursuant to this Article V shall be applied in the following order, at the date
or dates fixed by the Trustee and, in

                                       49
<PAGE>   57

case of the distribution of such money on account of principal, premium, if any,
or interest, upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:

                  FIRST: To the payment of all amounts due the Trustee under
Section 6.7;

                  SECOND: To the payment of the amounts then due and unpaid for
principal of, premium, if any, or interest (including Liquidated Damages, if
any) on, the Securities in respect of which or for the benefit of which such
money has been collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Securities for principal,
premium, if any, and interest (including Liquidated Damages, if any),
respectively;

                  THIRD: To such other Person or Persons, if any, to the extent
entitled thereto; and

                  FOURTH: Any remaining amounts shall be repaid to the Company.

SECTION 5.7       Limitation on Suits.

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

                  (1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;

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

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

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

                  (5) no direction inconsistent with such written request has
been given to the Trustee during such 60 day period by the Holders of a majority
in principal amount of the Outstanding Securities, it being understood and
intended that no one or more of such Holders shall have any right in any manner
whatever by virtue of, or by availing of, any provision of this Indenture to
affect, disturb or prejudice the rights of any other of such Holders, or to
obtain or seek to obtain priority or preference over any other of such Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all such Holders.

                                       50
<PAGE>   58

SECTION 5.8       Unconditional Right of Holders to Receive Principal, Premium
                  and Interest and to Convert.

                  Notwithstanding any other provision in this Indenture, but
subject to the provisions of Article XIII, the Holder of any Security shall have
the right, which is absolute and unconditional, to receive payment of the
principal of, premium, if any, and (subject to Section 3.7) interest (including
Liquidated Damages, if any) on such Security on the respective Stated Maturities
expressed in such Security (or, in the case of redemption or repurchase, on the
Redemption Date or Repurchase Date, as the case may be), and to convert such
Security in accordance with Article XII, and to institute suit for the
enforcement of any such payment and right to convert, and such rights shall not
be impaired without the consent of such Holder.

SECTION 5.9       Restoration of Rights and Remedies.

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

SECTION 5.10      Rights and Remedies Cumulative.

                  Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities in the last
paragraph of Section 3.6, no right or remedy herein conferred upon or reserved
to the Trustee or to the Holders of Securities is intended to be exclusive of
any other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity or otherwise.
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.

SECTION 5.11      Delay or Omission Not Waiver.

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

                                       51
<PAGE>   59

SECTION 5.12      Control by Holders of Securities.

                  The Holders of a majority in principal amount of the
Outstanding Securities shall have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on the Trustee, provided that

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

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

                  (3) the Trustee need not take any action which might involve
it in personal liability or be unjustly prejudicial to the Holders of Securities
not consenting.

SECTION 5.13      Waiver of Past Defaults.

                  The Holders, either (i) through the written consent of not
less than a majority in principal amount of the Outstanding Securities or (ii)
by the adoption of a resolution, at a meeting of Holders of the Outstanding
Securities at which a quorum is present, by the Holders of at least 66-2/3% in
principal amount of the Outstanding Securities represented at such meeting, may
on behalf of the Holders of all the Securities waive any past default hereunder
and its consequences, except a default (A) in the payment of the principal of,
premium, if any, or interest (including Liquidated Damages) on any Security, or
(B) in respect of a covenant or provision hereof which under Article VIII cannot
be modified or amended without the consent of the Holder of each Outstanding
Security affected. The provisions of this section modify the provisions of
Section 316(a)(1) of the Trust Indenture Act.

                  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 5.14      Undertaking for Costs.

                  All parties to this Indenture agree, and each Holder of any
Security by his acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Indenture, or any suit against the Trustee for any
action taken, suffered or omitted by it as Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section 5.14 shall not apply to any suit instituted
by the Company, to any suit instituted by the Trustee, to any suit instituted by
any Holder, or group of Holders, holding in the aggregate more than 10% in
principal amount of the Outstanding

                                       52
<PAGE>   60

Securities, or to any suit instituted by any Holder of any Security for the
enforcement of the payment of the principal of, premium, if any, or interest on
any Security on or after the respective Stated Maturity or Maturities expressed
in such Security (or, in the case of redemption or repurchase, on or after the
Redemption Date or Repurchase Date, as the case may be) or for the enforcement
of the right to convert any Security in accordance with Article XII.

SECTION 5.15      Waiver of Stay, Usury or Extension Laws.

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

                                   ARTICLE VI
                                   THE TRUSTEE

SECTION 6.1       Certain Duties and Responsibilities.

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

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

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

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

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

                                       53
<PAGE>   61

                  (i) this paragraph (3) shall not be construed to limit the
effect of paragraph (l) of this Section;

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

                  (iii) the Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance with the
direction of (i) the Holders of a majority in principal amount of the
Outstanding Securities or (ii) by the adoption of a resolution, at a meeting of
Holders of the Outstanding Securities at which a quorum is present, by the
Holders of at least 66 2/3% in principal amount of Outstanding Securities
represented at such meeting, relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under this Indenture; and

                  (iv) no provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.

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

SECTION 6.2       Notice of Defaults.

                  Within 90 days after the occurrence of any default hereunder
as to which the Trustee has received written notice, the Trustee shall give to
all Holders of Securities, in the manner provided in Section 1.6, notice of such
default, unless such default shall have been cured or waived; provided, however,
that, except in the case of a default in the payment of the principal of,
premium, if any, or interest on any Security the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee or a trust committee of directors or Responsible Officers of the
Trustee in good faith determines that the withholding of such notice is in the
interest of the Holders; and provided, further, that in the case of any default
of the character specified in Section 5.1(4), no such notice to Holders of
Securities shall be given until at least 60 days after the occurrence thereof
or, if applicable, the cure period specified therein. For the purpose of this
Section, the term "default" means any event which is, or after notice or lapse
of time or both would become, an Event of Default.

SECTION 6.3       Certain Rights of Trustee.

                  Subject to the provisions of Section 6.1:

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<PAGE>   62

                  (1) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officers' Certificate, other
certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, coupon, other evidence of indebtedness or
other paper or document (collectively, the "Documents") believed by it to be
genuine and to have been signed or presented by the proper party or parties, and
the Trustee need not investigate any fact or matter stated in such Documents;

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

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

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

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

                  (6) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, coupon, other evidence of indebtedness or other paper or
document, but the Trustee may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney;
and

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

SECTION 6.4 Not Responsible for Recitals or Issuance of Securities.

                  The recitals contained herein and in the Securities (except
the Trustee's certificates of authentication) shall be taken as the statements
of the Company, and the Trustee

                                       55
<PAGE>   63

assumes no responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture, of the
Securities or of the Common Stock issuable upon the conversion of the
Securities. The Trustee shall not be accountable for the use or application by
the Company of Securities or the proceeds thereof.

SECTION 6.5       May Hold Securities, Act as Trustee Under Other Indentures.

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

                  The Trustee may become and act as trustee under other
indentures under which other securities, or certificates of interest or
participation in other securities, of the Company are outstanding in the same
manner as if it were not Trustee hereunder.

SECTION 6.6       Money Held in Trust.

                  Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed in writing with the Company.

SECTION 6.7       Compensation and Reimbursement.

                  The Company agrees

                  (1) to pay to the Trustee from time to time such reasonable
compensation as the Company and the Trustee shall from time to time agree in
writing for its acceptance of this Indenture and for all services rendered by it
hereunder (which compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust);

                  (2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee (including costs and
expenses of enforcing this Indenture and defending itself against any claim
(whether asserted by the Company, any Holder of Securities or any other Person)
or liability in connection with the exercise of any of its powers or duties
hereunder) in accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith; and

                  (3) to indemnify the Trustee (and its directors, officers,
employees and agents) for, and to hold it harmless against, any loss, liability
or expense incurred without negligence or bad faith on its part, arising out of
or in connection with the acceptance or administration of this trust, including
the reasonable costs, expenses and reasonable attorneys' fees of defending
itself

                                       56
<PAGE>   64

against any claim or liability in connection with the exercise or performance of
any of its powers or duties hereunder.

                  When the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 5.1(6) or Section
5.1(7), the expenses (including the reasonable charges of its counsel) and the
compensation for the services are intended to constitute expenses of the
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.

                  The provisions of this Section shall survive the termination
of this Indenture or the earlier resignation or removal of the Trustee.

SECTION 6.8       Corporate Trustee Required; Eligibility.

                  There shall at all times be a Trustee hereunder which shall be
a Person that is eligible pursuant to the Trust Indenture Act to act as such,
having (or being part of a holding company with) a combined capital and surplus
of at least U.S. $50,000,000, subject to supervision or examination by federal
or state authority, and in good standing. The Trustee or an Affiliate of the
Trustee shall maintain an established place of business in the Borough of
Manhattan, The City of New York. Currently, such place of business is located at
30 Broad Street, New York, New York 10004-2304. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of said supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article and a
successor shall be appointed pursuant to Section 6.9.

SECTION 6.9       Resignation and Removal; Appointment of Successor.

                  (1) No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 6.10.

                  (2) The Trustee may resign at any time by giving written
notice thereof to the Company. If the instrument of acceptance by a successor
Trustee required by Section 6.10 shall not have been delivered to the Trustee
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment of
a successor Trustee.

                  (3) The Trustee may be removed at any time by an Act of the
Holders of a majority in principal amount of the Outstanding Securities,
delivered to the Trustee and the Company. If the instrument of acceptance by a
successor Trustee required by Section 6.10 shall not have been delivered to the
Trustee within 30 days after the giving of such notice of removal,

                                       57
<PAGE>   65

the removed Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee.

                  (4) If at any time:

                  (i) the Trustee shall cease to be eligible under Section 6.8
and shall fail to resign after written request therefor by the Company or by any
Holder of a Security who has been a bona fide Holder of a Security for at least
six months, or

                  (ii) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then, in any such case (i) the Company by a Board
Resolution may remove the Trustee, or (ii) subject to Section 5.14, any Holder
of a Security who has been a bona fide Holder of a Security for at least six
months may, on behalf of himself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.

                  (5) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause, the Company, by a Board Resolution, shall promptly appoint a
successor Trustee and shall comply with the applicable requirements of this
Section and Section 6.10. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities delivered to the Company and the retiring Trustee, the
successor Trustee so appointed shall, forthwith upon its acceptance of such
appointment in accordance with the applicable requirements of Section 6.10,
become the successor Trustee and supersede the successor Trustee appointed by
the Company. If no successor Trustee shall have been so appointed by the Company
or the Holders of Securities and accepted appointment in the manner required by
this Section and Section 6.10, any Holder of a Security who has been a bona fide
Holder of a Security for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee.

                  (6) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee to all
Holders of Securities in the manner provided in Section 1.6. Each notice shall
include the name of the successor Trustee and the address of its Corporate Trust
Office.

SECTION 6.10      Acceptance of Appointment by Successor.

                  Every successor Trustee appointed hereunder shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or the

                                       58
<PAGE>   66

successor Trustee, such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor Trustee all the
rights, powers and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder. Upon request of any such successor Trustee, the
Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Trustee all such rights, powers and
trusts.

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

SECTION 6.11      Merger, Conversion, Consolidation or Succession to Business.

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

SECTION 6.12      Authenticating Agents.

                  The Trustee may, with the consent of the Company, appoint an
Authenticating Agent or Agents acceptable to the Company with respect to the
Securities which shall be authorized to act on behalf of the Trustee to
authenticate Securities issued upon exchange or substitution pursuant to this
Indenture.

                  Securities authenticated by an Authenticating Agent shall be
entitled to the benefits of this Indenture and shall be valid and obligatory for
all purposes as if authenticated by the Trustee hereunder, and every reference
in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication shall be deemed to
include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
subject to acceptance by the Company and shall at all times be a corporation
organized and doing business under the laws of the United States of America, any
State thereof or the District of Columbia, authorized under such laws to act as
Authenticating Agent and subject to supervision or examination by government or
other fiscal authority. If at any time an Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section 6.12, such
Authenticating Agent shall resign immediately in the manner and with the effect
specified in this Section 6.12.

                                       59
<PAGE>   67

                  Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section 6.12, without the execution or filing of
any paper or any further act on the part of the Trustee or the Authenticating
Agent.

                  An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and to the Company. The Trustee may at any
time terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and to the Company. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 6.12, the Trustee may appoint a successor
Authenticating Agent which shall be subject to acceptance by the Company. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section 6.12.

                  The Company agrees to pay to each Authenticating Agent from
time to time reasonable compensation for its services under this Section 6.12.

                  If an Authenticating Agent is appointed with respect to the
Securities pursuant to this Section 6.12, the Securities may have endorsed
thereon, in addition to or in lieu of the Trustee's certification of
authentication, an alternative certificate of authentication in the following
form:

This is one of the Securities referred to in the within-mentioned Indenture.

                  [                                     ]
                   -------------------------------------,

                                            as Trustee

                                            By:
                                               -------------------------------
                                                    As Authenticating Agent

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

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<PAGE>   68

SECTION 6.13      Disqualification; Conflicting Interests.

                  If the Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Indenture.

SECTION 6.14      Preferential Collection of Claims Against Company.

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

                                  ARTICLE VII
              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

SECTION 7.1       Company May Consolidate, Etc., Only on Certain Terms.

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

                  (1) in case the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the Person formed by such
consolidation or into which the Company is merged, or the Person which acquires
by conveyance or transfer, or which leases the properties and assets of the
Company substantially as an entirety, shall be a corporation, limited liability
company, partnership or trust, shall be organized and validly existing under the
laws of the United States of America, any State thereof or the District of
Columbia and shall expressly assume, by an indenture supplemental hereto,
executed and delivered to the Trustee, in form satisfactory to the Trustee, the
due and punctual payment of the principal of, premium, if any, and interest
(including Liquidated Damages, if any) on all of the Securities as applicable,
and the performance or observance of every covenant of this Indenture on the
part of the Company to be performed or observed and shall have provided for
conversion rights in accordance with Article XII;

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

                  (3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger, conveyance, transfer or lease and, if a supplemental indenture is
required in connection with such transaction, such supplemental indenture comply
with this Article and that all conditions precedent herein

                                       61
<PAGE>   69

provided for relating to such transaction have been complied with, together with
any documents required under Section 8.3.

SECTION 7.2       Successor Substituted.

                  Upon any consolidation of the Company with, or merger of the
Company into any other Person or any conveyance, transfer or lease of all or
substantially all the properties and assets of the Company in accordance with
Section 7.1, the successor Person formed by such consolidation or into or with
which the Company is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise every right and
power of, the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein, and thereafter, except in
the case of a lease, the predecessor Person shall be relieved of all obligations
and covenants under this Indenture and the Securities.

                                  ARTICLE VIII
                            SUPPLEMENTAL INDENTURES

SECTION 8.1       Supplemental Indentures Without Consent of Holders of
                  Securities.

                  Without the consent of any Holders of Securities the Company,
when authorized by a Board Resolution, and the Trustee, at any time and from
time to time, may enter into one or more indentures supplemental hereto for any
of the following purposes:

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

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

                  (3) to secure the Securities; or

                  (4) to make provision with respect to the conversion rights of
Holders of Securities pursuant to Section 12.11 or to make provision with
respect to the repurchase rights of Holders of Securities pursuant to Section
14.5; or

                  (5) to make any changes or modifications to this Indenture
necessary in connection with the registration of any Registrable Securities
under the Securities Act as contemplated by Section 10.11, provided such action
pursuant to this clause (5) shall not adversely affect the interests of the
Holders of Securities; or

                  (6) to comply with the requirements of the Trust Indenture Act
or the rules and regulations of the Commission thereunder in order to effect or
maintain the qualification of this Indenture under the Trust Indenture Act, as
contemplated by this Indenture or otherwise; or

                                       62
<PAGE>   70

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

                  (8) subject to Section 13.12, to make any change in Article
XIII that would limit or terminate the benefits available to any holder of
Senior Indebtedness under such Article; or

                  (9) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision herein or
which is otherwise defective, or to make any other provisions with respect to
matters or questions arising under this Indenture as the Company and the Trustee
may deem necessary or desirable, provided such action pursuant to this clause
(9) shall not adversely affect the interests of the Holders of Securities in any
material respect.

                  Upon Company Request, accompanied by a Board Resolution
authorizing the execution of any such supplemental indenture, and subject to and
upon receipt by the Trustee of the documents described in Section 8.3 hereof,
the Trustee shall join with the Company in the execution of any supplemental
indenture authorized or permitted by the terms of this Indenture and to make any
further appropriate agreements and stipulations which may be therein contained.

SECTION 8.2       Supplemental Indentures with Consent of Holders of Securities.

                  With either (i) the written consent of the Holders of not less
than a majority in principal amount of the Outstanding Securities, by the Act of
said Holders delivered to the Company and the Trustee, or (ii) by the adoption
of a resolution, at a meeting of Holders of the Outstanding Securities at which
a quorum is present, by the Holders of at least 66-2/3% in principal amount of
the Outstanding Securities represented at such meeting, the Company, when
authorized by a Board Resolution, and the Trustee may enter into an indenture or
indentures supplemental hereto for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture or
of modifying in any manner the rights of the Holders of Securities under this
Indenture; provided, however, that no such supplemental indenture shall, without
the consent or affirmative vote of the Holder of each Outstanding Security
affected thereby,

                  (1) change the Stated Maturity of the principal of, or any
installment of interest on, any Security, or reduce the principal amount of, or
the premium, if any, or the rate of interest payable thereon (including
Liquidated Damages), or reduce the amount payable upon a redemption or mandatory
repurchase, or change the place or currency of payment of the principal of,
premium, if any, or interest on any Security (including any payment of
Liquidated Damages or Redemption Price or Repurchase Price in respect of such
Security) or impair the right to institute suit for the enforcement of any
payment in respect of any Security on or after the Stated Maturity thereof (or,
in the case of redemption or any repurchase, on or after the Redemption Date or
Repurchase Date, as the case may be) or, except as permitted by Section 12.11,
adversely affect the right of Holders to convert any Security as provided in
Article XII, or modify the

                                       63
<PAGE>   71

provisions of this Indenture with respect to the subordination of the Securities
in a manner adverse to the Holders; or

                  (2) reduce the requirements of Section 9.4 for quorum or
voting, or reduce the percentage in principal amount of the Outstanding
Securities the consent of whose Holders is required for any such supplemental
indenture or the consent of whose Holders is required for any waiver (of
compliance with certain provisions of this Indenture or certain defaults
hereunder and their consequences) provided for in this Indenture; or

                  (3) modify the obligation of the Company to maintain an office
or agency in the Borough of Manhattan, The City of New York, pursuant to Section
10.2; or

                  (4) modify any of the provisions of this Section or Section
5.13 or 10.12, except to increase any percentage contained herein or therein or
to provide that certain other provisions of this Indenture cannot be modified or
waived without the consent of the Holder of each Outstanding Security affected
thereby; or

                  (5) modify the provisions of Article XIV in a manner adverse
to the Holders; or

                  (6) modify any of the provisions of Section 10.9 in a manner
adverse to the Holders or Section 10.10.

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

SECTION 8.3       Execution of Supplemental Indentures.

                  In executing, or accepting the additional trusts created by,
any supplemental indenture permitted by this Article or the modifications
thereby of the trusts created by this Indenture, the Trustee shall be entitled
to receive, and (subject to Sections 6.1 and 6.3) shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture, and that
such supplemental indenture has been duly authorized, executed and delivered by
the Company and constitutes a valid and legally binding obligation of the
Company enforceable against the Company in accordance with its terms. The
Trustee may, but shall not be obligated to, enter into any such supplemental
indenture which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.

SECTION 8.4       Effect of Supplemental Indentures.

                  Upon the execution of any supplemental indenture under this
Article, this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form

                                       64
<PAGE>   72

a part of this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder appertaining
thereto shall be bound thereby.

SECTION 8.5       Reference in Securities to Supplemental Indentures.

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

SECTION 8.6       Notice of Supplemental Indentures.

                  Promptly after the execution by the Company and the Trustee of
any supplemental indenture pursuant to the provisions of Section 8.2, the
Company shall give notice to all Holders of Securities of such fact, setting
forth in general terms the substance of such supplemental indenture, in the
manner provided in Section 1.6. Any failure of the Company to give such notice,
or any defect therein, shall not in any way impair or affect the validity of any
such supplemental indenture.

                                   ARTICLE IX
                        MEETINGS OF HOLDERS OF SECURITIES

SECTION 9.1       Purposes for Which Meetings May Be Called.

                  A meeting of Holders of Securities may be called at any time
and from time to time pursuant to this Article to make, give or take any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be made, given or taken by Holders of
Securities.

SECTION 9.2       Call, Notice and Place of Meetings.

                  (1) The Trustee may at any time call a meeting of Holders of
Securities for any purpose specified in Section 9.1, to be held at such time and
at such place in the Borough of Manhattan, The City of New York, as the Trustee
shall determine. Notice of every meeting of Holders of Securities, setting forth
the time and the place of such meeting and in general terms the action proposed
to be taken at such meeting, shall be given, in the manner provided in Section
1.6, not less than 21 nor more than 180 days prior to the date fixed for the
meeting.

                  (2) In case at any time the Company, pursuant to a Board
Resolution, or the Holders of at least 10% in principal amount of the
Outstanding Securities shall have requested the Trustee to call a meeting of the
Holders of Securities for any purpose specified in Section 9.1, by written
request setting forth in reasonable detail the action proposed to be taken at
the

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<PAGE>   73

meeting, and the Trustee shall not have mailed the notice of such meeting within
21 days after receipt of such request or shall not thereafter proceed to cause
the meeting to be held as provided herein, then the Company or the Holders of
Securities in the amount specified, as the case may be, may determine the time
and the place in the Borough of Manhattan, The City of New York, for such
meeting and may call such meeting for such purposes by giving notice thereof as
provided in paragraph (1) of this Section.

SECTION 9.3       Persons Entitled to Vote at Meetings.

                  To be entitled to vote at any meeting of Holders of
Securities, a Person shall be (i) a Holder of one or more Outstanding
Securities, or (ii) a Person appointed by an instrument in writing as proxy for
a Holder or Holders of one or more Outstanding Securities by such Holder or
Holders. The only Persons who shall be entitled to be present or to speak at any
meeting of Holders shall be the Persons entitled to vote at such meeting and
their counsel, any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel.

SECTION 9.4       Quorum; Action.

                  The Persons entitled to vote a majority in principal amount of
the Outstanding Securities shall constitute a quorum. In the absence of a quorum
within 30 minutes of the time appointed for any such meeting, the meeting shall,
if convened at the request of Holders of Securities, be dissolved. In any other
case, the meeting may be adjourned for a period of not less than 10 days as
determined by the chairman of the meeting prior to the adjournment of such
meeting. In the absence of a quorum at any such adjourned meeting, such
adjourned meeting may be further adjourned for a period not less than 10 days as
determined by the chairman of the meeting prior to the adjournment of such
adjourned meeting (subject to repeated applications of this sentence). Notice of
the reconvening of any adjourned meeting shall be given as provided in Section
9.2(1), except that such notice need be given only once not less than five days
prior to the date on which the meeting is scheduled to be reconvened. Notice of
the reconvening of an adjourned meeting shall state expressly the percentage of
the principal amount of the Outstanding Securities which shall constitute a
quorum.

                  Subject to the foregoing, at the reconvening of any meeting
adjourned for a lack of a quorum, the Persons entitled to vote 25% in principal
amount of the Outstanding Securities at the time shall constitute a quorum for
the taking of any action set forth in the notice of the original meeting.

                  At a meeting or an adjourned meeting duly reconvened and at
which a quorum is present as aforesaid, any resolution and all matters (except
as limited by the proviso to Section 8.2 and except to the extent Section 10.12
requires a different vote) shall be effectively passed and decided if passed or
decided by the lesser of (i) the Holders of not less than a majority in
principal amount of Outstanding Securities and (ii) the Persons entitled to vote
not less than 66-2/3% in principal amount of Outstanding Securities represented
and entitled to vote at such meeting.

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<PAGE>   74

                  Any resolution passed or decisions taken at any meeting of
Holders of Securities duly held in accordance with this Section shall be binding
on all the Holders of Securities whether or not present or represented at the
meeting. The Trustee shall, in the name and at the expense of the Company,
notify all the Holders of Securities of any such resolutions or decisions
pursuant to Section 1.6.

SECTION 9.5       Determination of Voting Rights; Conduct and Adjournment of
                  Meetings.

                  (1) Notwithstanding any other provisions of this Indenture,
the Trustee may make such reasonable regulations as it may deem advisable for
any meeting of Holders of Securities in regard to proof of the holding of
Securities and of the appointment of proxies and in regard to the appointment
and duties of inspectors of votes, the submission and examination of proxies,
certificates and other evidence of the right to vote, and such other matters
concerning the conduct of the meeting as it shall deem appropriate. Except as
otherwise permitted or required by any such regulations, the holding of
Securities shall be proved in the manner specified in Section 1.4 and the
appointment of any proxy shall be proved in the manner specified in Section 1.4
or by having the signature of the Person executing the proxy guaranteed by any
bank, broker or other eligible institution participating in a recognized
medallion signature guarantee program.

                  (2) The Trustee shall, by an instrument in writing, appoint a
temporary chairman (which may be the Trustee) of the meeting, unless the meeting
shall have been called by the Company or by Holders of Securities as provided in
Section 9.2(2), in which case the Company or the Holders of Securities calling
the meeting, as the case may be, shall in like manner appoint a temporary
chairman. A permanent chairman and a permanent secretary of the meeting shall be
elected by vote of the Persons entitled to vote a majority in principal amount
of the Outstanding Securities represented at the meeting.

                  (3) At any meeting, each Holder of a Security or proxy shall
be entitled to one vote for each U.S. $1,000 principal amount of Securities held
or represented by him; provided, however, that no vote shall be cast or counted
at any meeting in respect of any Security challenged as not Outstanding and
ruled by the chairman of the meeting to be not Outstanding. The chairman of the
meeting shall have no right to vote, except as a Holder of a Security or proxy.

                  (4) Any meeting of Holders of Securities duly called pursuant
to Section 9.2 at which a quorum is present may be adjourned from time to time
by Persons entitled to vote a majority in principal amount of the Outstanding
Securities represented at the meeting, and the meeting may be held as so
adjourned without further notice.

SECTION 9.6       Counting Votes and Recording Action of Meetings.

                  The vote upon any resolution submitted to any meeting of
Holders of Securities shall be by written ballots on which shall be subscribed
the signatures of the Holders of Securities or of their representatives by proxy
and the principal amounts at Stated Maturity and

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<PAGE>   75

serial numbers of the Outstanding Securities held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in duplicate of all votes cast at the meeting. A record, at least in
duplicate, of the proceedings of each meeting of Holders of Securities shall be
prepared by the secretary of the meeting and there shall be attached to said
record the original reports of the inspectors of votes on any vote by ballot
taken thereat and affidavits by one or more Persons having knowledge of the
facts setting forth a copy of the notice of the meeting and showing that said
notice was given as provided in Section 9.2 and, if applicable, Section 9.4.
Each copy shall be signed and verified by the affidavits of the permanent
chairman and secretary of the meeting and one such copy shall be delivered to
the Company and another to the Trustee to be preserved by the Trustee, the
latter to have attached thereto the ballots voted at the meeting. Any record so
signed and verified shall be conclusive evidence of the matters therein stated.

                                   ARTICLE X
                                    COVENANTS

SECTION 10.1      Payment of Principal, Premium and Interest.

                  The Company covenants and agrees that it will duly and
punctually pay the principal of and premium, if any, and interest (including
Liquidated Damages, if any) on the Securities in accordance with the terms of
the Securities and this Indenture. The Company will deposit or cause to be
deposited with the Trustee, no later than the opening of business on the date of
the Stated Maturity of any Security or no later than the opening of business on
the due date for any installment of interest, all payments so due, which
payments shall be in immediately available funds on the date of such Stated
Maturity or due date, as the case may be.

SECTION 10.2      Maintenance of Offices or Agencies.

                  The Company will maintain in the Borough of Manhattan, The
City of New York, an office or agency where the Securities may be surrendered
for registration of transfer or exchange or for presentation for payment or for
conversion, redemption or repurchase and where notices and demands to or upon
the Company in respect of the Securities and this Indenture may be served. The
Company will give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency not designated or appointed by
the Trustee. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office or the office or agency of the Trustee in the Borough of
Manhattan, The City of New York.

                  The Company may at any time and from time to time vary or
terminate the appointment of any such agent or appoint any additional agents for
any or all of such purposes; provided, however, that until all of the Securities
have been delivered to the Trustee for cancellation, or moneys sufficient to pay
the principal of, premium, if any, and interest on the Securities have been made
available for payment and either paid or returned to the Company

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<PAGE>   76

pursuant to the provisions of Section 10.3, the Company will maintain in the
Borough of Manhattan, The City of New York, an office or agency where Securities
may be presented or surrendered for payment and conversion, where Securities may
be surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Securities and this Indenture
may be served. The Company will give prompt written notice to the Trustee, and
notice to the Holders in accordance with Section 1.6, of the appointment or
termination of any such agents and of the location and any change in the
location of any such office or agency.

                  The Company hereby initially designates the Trustee as Paying
Agent, Security Registrar and Conversion Agent, and each of the Corporate Trust
Office of the Trustee and the office or agency of the Trustee in the Borough of
Manhattan, The City of New York, located at 30 Broad Street, 14th Floor, New
York, New York 10004-2304, one such office or agency of the Company for each of
the aforesaid purposes.

SECTION 10.3      Money for Security Payments To Be Held in Trust.

                  If the Company shall act as its own Paying Agent, it will, on
or before each due date of the principal of, premium, if any, or interest on any
of the Securities, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal, premium, if any, or
interest so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and the Company will promptly notify
the Trustee of its action or failure so to act.

                  Whenever the Company shall have one or more Paying Agents, it
will, no later than the opening of business on each due date of the principal
of, premium, if any, or interest on any Securities, deposit with the Trustee a
sum in funds immediately payable on the payment date sufficient to pay the
principal, premium, if any, or interest so becoming due, such sum to be held for
the benefit of the Persons entitled to such principal, premium, if any, or
interest, and (unless such Paying Agent is the Trustee) the Company will
promptly notify the Trustee of any failure so to act.

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

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

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

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<PAGE>   77

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

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

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

SECTION 10.4      Existence.

                  Subject to Article VII, the Company will do or cause to be
done all things necessary to preserve and keep in full force and effect its
existence, rights (charter and statutory) and franchises; provided, however,
that the Company shall not be required to preserve 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 that the loss
thereof is not disadvantageous in any material respect to the Holders.

SECTION 10.5      Maintenance of Properties.

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

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<PAGE>   78

SECTION 10.6      Payment of Taxes and Other Claims.

                  The Company will pay or discharge, or cause to be paid or
discharged, before the same may become delinquent, (i) all taxes, assessments
and governmental charges levied or imposed upon the Company or any Significant
Subsidiary or upon the income, profits or property of the Company or any
Significant Subsidiary, (ii) all claims for labor, materials and supplies which,
if unpaid, might by law become a lien or charge upon the property of the Company
or any Significant Subsidiary, and (iii) all stamps and other duties, if any,
which may be imposed by the United States or any political subdivision thereof
or therein in connection with the issuance, transfer, exchange or conversion of
any Securities or with respect to this Indenture; provided, however, that, in
the case of clauses (i) and (ii), the Company shall not be required to pay or
discharge or cause to be paid or discharged any such tax, assessment, charge or
claim (A) if the failure to do so will not, in the aggregate, have a material
adverse impact on the Company, or (B) if the amount, applicability or validity
is being contested in good faith by appropriate proceedings.

SECTION 10.7      Registration and Listing.

                  The Company (i) will effect all registrations with, and obtain
all approvals by, all governmental authorities that may be necessary under any
United States Federal or state law (including the Securities Act, the Exchange
Act and state securities and Blue Sky laws) before the shares of Common Stock
issuable upon conversion of Securities are issued and delivered, and qualified
or listed as contemplated by clause (ii) (it being understood that the Company
shall not be required to register the Securities under the Securities Act,
except pursuant to the Registration Rights Agreement referred to in Section
10.11); and (ii) will qualify the shares of Common Stock required to be issued
and delivered upon conversion of Securities, prior to such issuance or delivery,
for listing on the New York Stock Exchange or, if the Common Stock is not then
listed on the New York Stock Exchange, list the Common Stock on each national
securities exchange or quotation system on which outstanding Common Stock is
listed or quoted at the time of such delivery.

                  Nothing in this Section will limit the application of Section
10.11.

SECTION 10.8      Statement by Officers as to Default.

                  The Company shall deliver to the Trustee, within 120 days
after the end of each fiscal year of the Company ending after the date hereof,
an Officers' Certificate, stating whether or not to the best knowledge of the
signers thereof the Company is in default in the performance and observance of
any of the terms, provisions and conditions of this Indenture (without regard to
any period of grace or requirement of notice provided hereunder) and, if the
Company shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge.

                  The Company will deliver to the Trustee, forthwith upon
becoming aware of any default in the performance or observance of any covenant,
agreement or condition contained in

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<PAGE>   79

this Indenture, or any Event of Default, an Officers' Certificate specifying
with particularity such default or Event of Default and further stating what
action the Company has taken, is taking or proposes to take with respect
thereto.

                  Any notice required to be given under this Section 10.8 shall
be delivered to the Trustee at its Corporate Trust Office.

SECTION 10.9      Delivery of Certain Information.

                  At any time when the Company is not subject to Section 13 or
15(d) of the Exchange Act, upon the request of a Holder of a Restricted Security
or the holder of shares of Common Stock issued upon conversion thereof, the
Company will promptly furnish or cause to be furnished Rule 144A Information (as
defined below) to such Holder of Restricted Securities or such holder of shares
of Common Stock issued upon conversion of Restricted Securities, or to a
prospective purchaser of any such security designated by any such Holder or
holder, as the case may be, to the extent required to permit compliance by such
Holder or holder with Rule 144A under the Securities Act (or any successor
provision thereto) in connection with the resale of any such security; provided,
however, that the Company shall not be required to furnish such information in
connection with any request made on or after the date which is two years from
the later of (i) the date such a security (or any such predecessor security) was
last acquired from the Company or (ii) the date such a security (or any such
predecessor security) was last acquired from an "affiliate" of the Company
within the meaning of Rule 144 under the Securities Act (or any successor
provision thereto). "Rule 144A Information" shall be such information as is
specified pursuant to Rule 144A(d)(4) under the Securities Act (or any successor
provision thereto).

SECTION 10.10     Resale of Certain Securities.

                  During the period beginning on the last date of original
issuance of the Securities and ending on the date that is two years from such
date (or such shortened period under Rule 144(k) under the Securities Act or any
successor rule), the Company will not, and will not permit any of its
subsidiaries or other "affiliates" (as defined under Rule 144 under the
Securities Act or any successor provision thereto) to, resell (i) any Securities
which constitute "restricted securities" under Rule 144 or (ii) any securities
into which the Securities have been converted under this Indenture which
constitute "restricted securities" under Rule 144, that in either case have been
reacquired by any of them. The Trustee shall have no responsibility in respect
of the Company's performance of its agreement in the preceding sentence.

SECTION 10.11     Registration Rights.

                  The Company agrees that the Holders from time to time of
Registrable Securities (as defined below) are entitled to the benefits of a
Registration Rights Agreement, dated as of February 21, 2001 (the "Registration
Rights Agreement"), executed by the Company. Pursuant to the Registration Rights
Agreement, the Company has agreed for the benefit of the holders from time to
time of the Registrable Securities that it will, at its expense, (i) within 90
days after

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<PAGE>   80

the Issue Date (as defined below) of the Securities, file a shelf registration
statement (the "Shelf Registration Statement") with the Commission with respect
to resales of the Registrable Securities, (ii) use its reasonable efforts to
cause such Shelf Registration Statement to be declared effective by the
Commission within 180 days after the Issue Date of the Securities, provided,
however, that the Company may, upon written notice to all of the Holders,
postpone having the Shelf Registration Statement declared effective for a
reasonable period not to exceed 90 days if the Company possesses material
non-public information, the disclosure of which would have a material adverse
effect on the Company and its subsidiaries taken as a whole, and (iii) use its
reasonable efforts to maintain such Shelf Registration Statement effective under
the Securities Act until the second annual anniversary of the date it is
declared effective or such earlier date as is provided in the Registration
Rights Agreement (the "Effectiveness Period"). The Company will be permitted to
suspend the use of the prospectus which is a part of the Shelf Registration
Statement during certain periods of time as provided in the Registration Rights
Agreement.

                  If (i) on or prior to 90 days following the Issue Date of the
Securities, a Shelf Registration Statement has not been filed with the
Commission, or (ii) on or prior to the 180th day following the Issue Date of the
Securities, such Shelf Registration Statement is not declared effective (each, a
"Registration Default"), damages ("Liquidated Damages") will accrue on the
Restricted Securities from and including the day following such Registration
Default to but excluding the day on which such Registration Default has been
cured. Liquidated Damages will be paid semi-annually in arrears, with the first
semi-annual payment due on the first Interest Payment Date in respect of the
Restricted Securities following the date on which such Liquidated Damages begin
to accrue, and will accrue at a rate per annum equal to an additional
one-quarter of one percent (0.25%) of the principal amount of the Restricted
Securities to and including the 90th day following such Registration Default and
at a rate per annum equal to one-half of one percent (0.50%) thereof from and
after the 91st day following such Registration Default. Pursuant to the
Registration Rights Agreement, in the event that the Shelf Registration
Statement ceases to be effective (or the Holders of Registrable Securities are
otherwise prevented or restricted by the Company from effecting sales pursuant
thereto) during the Effectiveness Period for more than 30 days, whether or not
consecutive, in any 90-day period, or 90 days, whether or not consecutive,
during any 12-month period (an "Effective Failure"), then the interest rate
borne by the Restricted Securities shall increase by an additional one-half of
one percent (0.50%) per annum on the 31st day of the applicable 90-day period or
the 91st day of the applicable 12-month period, as the case may be, that such
Shelf Registration Statement ceases to be effective (or the Holders of
Registrable Securities are otherwise prevented or restricted by the Company from
effecting sales pursuant thereto), to but excluding the day on which (i) the
Effective Failure is cured or (ii) the Effectiveness Period expires.

                  Whenever in this Indenture there is mentioned, in any context,
the payment of the principal of, premium, if any, or interest on, or in respect
of, any Security, such mention shall be deemed to include mention of the payment
of Liquidated Damages provided for in this Section to the extent that, in such
context, Liquidated Damages are, were or would be payable in respect thereof
pursuant to the provisions of this Section and express mention of the payment of

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<PAGE>   81

Liquidated Damages (if applicable) in any provisions hereof shall not be
construed as excluding Liquidated Damages in those provisions hereof where such
express mention is not made.

                  For the purposes of the Registration Rights Agreement,
"Registrable Securities" means all or any portion of the Restricted Securities
issued from time to time under this Indenture and the shares of Common Stock
issuable upon conversion or repurchase of such Restricted Securities except any
such Restricted Security or share of Common Stock issuable upon conversion or
repurchase thereof which (i) has been effectively registered under the
Securities Act and sold in a manner contemplated by the Shelf Registration
Statement, (ii) has been transferred in compliance with Rule 144 under the
Securities Act (or any successor provision thereto) or is transferable pursuant
to paragraph (k) of such Rule 144 (or any successor provision thereto) or (iii)
otherwise has been transferred and a new Security or share of Common Stock not
subject to transfer restrictions under the Securities Act has been delivered by
or on behalf of the Company in accordance with Section 3.5 of this Indenture.

                  If a Security, or the shares of Common Stock issuable upon
conversion of a Security, is a Registrable Security, and the Holder thereof
elects to sell such Registrable Security pursuant to the Shelf Registration
Statement then, by its acceptance thereof, the Holder of such Registrable
Security will have agreed to be bound by the terms of the Registration Rights
Agreement relating to the Registrable Securities which are the subject of such
election.

                  For the purposes of the Registration Rights Agreement, the
term "Holder" includes any Person that has a beneficial interest in any
Restricted Global Security or any beneficial interest in a global security
representing shares of Common Stock issuable upon conversion of a Security.

                  If Liquidated Damages are payable under the Registration
Rights Agreement, the Company shall deliver to the Trustee a certificate to that
effect stating (i) the amount of Liquidated Damages that is payable and (ii) the
date on which Liquidated Damages is payable. Unless and until a Responsible
Officer of the Trustee receives at the Corporate Trust Office such a
certificate, the Trustee may assume without inquiry that no Liquidated Damages
are payable. If Liquidated Damages have been paid by the Company directly to the
persons entitled to them, the Company shall deliver to the Trustee a certificate
setting forth the particulars of such payment.

SECTION 10.12     Waiver of Certain Covenants.

                  The Company may omit in any particular instance to comply with
any covenant or condition set forth in Sections 10.4 to 10.6, inclusive (other
than a covenant or condition which under Article VIII cannot be modified or
amended without the consent of the Holder of each Outstanding Security
affected), if before the time for such compliance the Holders shall, through the
written consent of, or the adoption of a resolution at a meeting of Holders of
the Outstanding Securities at which a quorum is present by, not less than a
majority in principal amount of the Outstanding Securities, either waive such
compliance in such instance or generally waive compliance with such covenant or
condition, but no such waiver shall extend to or affect

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<PAGE>   82

such covenant or condition except to the extent so expressly waived, and, until
such waiver shall become effective, the obligations of the Company and the
duties of the Trustee or any Paying or Conversion Agent in respect of any such
covenant or condition shall remain in full force and effect.

                                   ARTICLE XI
                            REDEMPTION OF SECURITIES

SECTION 11.1      Right of Redemption.

                  The Securities may be redeemed in accordance with the
provisions of the form of Securities set forth in Section 2.2.

SECTION 11.2      Applicability of Article.

                  Redemption of Securities at the election of the Company or
otherwise, as permitted or required by any provision of the Securities or this
Indenture, shall be made in accordance with such provision and this Article XI.

SECTION 11.3      Election to Redeem; Notice to Trustee.

                  The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution. In case of any redemption at the election of
the Company of any of the Securities, the Company shall, at least 30 days prior
to the Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee in writing of such Redemption
Date.

SECTION 11.4      Selection by Trustee of Securities To Be Redeemed.

                  If less than all the Securities are to be redeemed, the
particular Securities to be redeemed shall be selected by the Trustee within
five Business Days after it receives the notice described in 11.3, from the
Outstanding Securities not previously called for redemption, by lot or by such
other method as the Trustee may deem fair and appropriate.

                  If any Security selected for partial redemption is converted
in part before termination of the conversion right with respect to the portion
of the Security so selected, the converted portion of such Security shall be
deemed (so far as may be) to be the portion selected for redemption. Securities
which have been converted during a selection of Securities to be redeemed may be
treated by the Trustee as Outstanding for the purpose of such selection. The
Trustee shall promptly notify the Company and each Security 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 all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities

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<PAGE>   83

shall relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.

SECTION 11.5      Notice of Redemption.

                  Notice of redemption shall be given in the manner provided in
Section 1.6 to the Holders of Securities to be redeemed not less than 30 nor
more than 60 days prior to the Redemption Date, and such notice shall be
irrevocable. Promptly after giving such notice, the Company shall make a public
announcement thereof by release made to Reuters Economic Services and Bloomberg
Business News.

                  All notices of redemption shall state:

                  (1) the Redemption Date,

                  (2) the Redemption Price, and accrued interest (including
Liquidated Damages, if any), if any, to the Redemption Date,

                  (3) if less than all Outstanding Securities are to be
redeemed, the aggregate principal amount of Securities to be redeemed and the
aggregate principal amount of Securities which will be outstanding after such
partial redemption,

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

                  (5) the Conversion Rate, the date on which the right to
convert the Securities to be redeemed will terminate and the places where such
Securities may be surrendered for conversion, and

                  (6) the place or places where such Securities are to be
surrendered for payment of the Redemption Price and accrued interest (including
Liquidated Damages, if any), if any, to the Redemption Date.

                  In case of a partial redemption, the notice shall specify the
serial and CUSIP numbers (if any) and the portions thereof called for redemption
and that transfers and exchanges may occur on or prior to the Redemption Date.

                  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 of and at the expense of the
Company. Notice of redemption of Securities to be redeemed at the election of
the Company received by the Trustee shall be given by the Trustee to each Paying
Agent in the name of and at the expense of the Company.

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<PAGE>   84

SECTION 11.6      Deposit of Redemption Price.

                  On or prior to the Redemption Date, the Company shall deposit
with the Trustee (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 10.3) an amount of money
(which shall be in immediately available funds on such Redemption Date)
sufficient to pay the Redemption Price of, and (except if the Redemption Date
shall be an Interest Payment Date) accrued interest (including Liquidated
Damages, if any) to the Redemption Date on, all the Securities which are to be
redeemed on that date other than any Securities called for redemption on that
date which have been converted prior to the date of such deposit.

                  If any Security called for redemption is converted, any money
deposited with the Trustee or so segregated and held in trust for the redemption
of such Security shall (subject to any right of the Holder of such Security or
any Predecessor Security to receive interest as provided in the last paragraph
of Section 3.7) be paid to the Company on Company Request or, if then held by
the Company, shall be discharged from such trust.

SECTION 11.7      Securities Payable on Redemption Date.

                  Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified and from and after such date
(unless the Company shall default in the payment of the Redemption Price,
including accrued interest) such Securities shall cease to bear interest. Upon
surrender of any Security for redemption in accordance with said notice such
Security shall be paid by the Company at the Redemption Price together with
accrued and unpaid interest (including Liquidated Damages, if any) to the
Redemption Date; provided, however, that installments of interest on Securities
whose Stated Maturity is on or prior to the Redemption Date shall be payable to
the Holders of such Securities, or one or more Predecessor Securities,
registered as such on the relevant Record Date according to their terms and the
provisions of Section 3.7.

                  If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal amount of, premium, if any,
and, to the extent permitted by applicable law, accrued interest on such
Security shall, until paid, bear interest from the Redemption Date at a rate of
3.50% per annum and such Security shall remain convertible until the Redemption
Price of such Security (or portion thereof, as the case may be) shall have been
paid or duly provided for.

                  Any Security which is to be redeemed only in part shall be
surrendered at the Corporate Trust Office or an office or agency of the Company
designated for that purpose pursuant to Section 10.2 (with, if the Company or
the Trustee so requires, due endorsement by, or a written instrument of transfer
in form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or his attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and make available for delivery to
the Holder of such Security without service charge, a new Security or
Securities, of any authorized

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<PAGE>   85

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.

SECTION 11.8      Conversion Arrangement on Call for Redemption.

                  In connection with any redemption of Securities, the Company
may arrange for the purchase and conversion of any Securities by an agreement
with one or more investment bankers or other purchasers (the "Purchasers") to
purchase such securities by paying to the Trustee in trust for the Holders, on
or before the Redemption Date, an amount not less than the applicable Redemption
Price, together with interest accrued to the Redemption Date, of such
Securities. Notwithstanding anything to the contrary contained in this Article
XI, the obligation of the Company to pay the Redemption Price, together with
interest accrued to the Redemption Date, shall be deemed to be satisfied and
discharged to the extent such amount is so paid by such Purchasers. If such an
agreement is entered into (a copy of which shall be filed with the Trustee prior
to the close of business on the Business Day immediately prior to the Redemption
Date), any Securities called for redemption that are not duly surrendered for
conversion by the Holders thereof may, at the option of the Company, be deemed,
to the fullest extent permitted by law, and consistent with any agreement or
agreements with such Purchasers, to be acquired by such Purchasers from such
Holders and (notwithstanding anything to the contrary contained in Article XII)
surrendered by such Purchasers for conversion, all as of immediately prior to
the close of business on the Redemption Date (and the right to convert any such
Securities shall be extended through such time), subject to payment of the above
amount as aforesaid. At the direction of the Company, the Trustee shall hold and
dispose of any such amount paid to it by the Purchasers to the Holders in the
same manner as it would monies deposited with it by the Company for the
redemption of Securities. Without the Trustee's prior written consent, no
arrangement between the Company and such Purchasers for the purchase and
conversion of any Securities shall increase or otherwise affect any of the
powers, duties, responsibilities or obligations of the Trustee as set forth in
this Indenture, and the Company agrees to indemnify the Trustee from, and hold
it harmless against, any loss, liability or expense arising out of or in
connection with any such arrangement for the purchase and conversion of any
Securities between the Company and such Purchasers, including the costs and
expenses, including reasonable legal fees, incurred by the Trustee in the
defense of any claim or liability arising out of or in connection with the
exercise or performance of any of its powers, duties, responsibilities or
obligations under this Indenture.

                                  ARTICLE XII
                            CONVERSION OF SECURITIES

SECTION 12.1      Conversion Privilege and Conversion Rate.

                  Subject to and upon compliance with the provisions of this
Article, at the option of the Holder thereof, any Security may be converted into
fully paid and nonassessable shares (calculated as to each conversion to the
nearest l/l00th of a share) of Common Stock of the Company at the Conversion
Rate, determined as hereinafter provided, in effect at the time of

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<PAGE>   86

conversion. Such conversion right shall commence on the initial issuance date of
the Securities and expire at the close of business on February 15, 2006,
subject, in the case of conversion of any Global Security, to any Applicable
Procedures. In case a Security or portion thereof is called for redemption at
the election of the Company or the Holder thereof exercises his right to require
the Company to repurchase the Security, such conversion right in respect of the
Security, or portion thereof so called, shall expire at the close of business on
the Redemption Date or the Repurchase Date, as the case may be, unless the
Company defaults in making the payment due upon redemption or repurchase, as the
case may be (in each case subject as aforesaid to any Applicable Procedures with
respect to any Global Security).

                  The rate at which shares of Common Stock shall be delivered
upon conversion (herein called the "Conversion Rate") shall be initially 11.5117
shares of Common Stock for each U.S.$1,000 principal amount of Securities. The
Conversion Rate shall be adjusted in certain instances as provided in this
Article XII.

SECTION 12.2      Exercise of Conversion Privilege.

                  In order to exercise the conversion privilege, the Holder of
any Security to be converted shall surrender such Security, duly endorsed in
blank, at any office or agency of the Company maintained for that purpose
pursuant to Section 10.2, accompanied by a duly signed conversion notice
substantially in the form set forth in Section 2.4 stating that the Holder
elects to convert such Security or, if less than the entire principal amount
thereof is to be converted, the portion thereof to be converted. Each Security
surrendered for conversion (in whole or in part) during the Record Date Period
shall (except in the case of any Security or portion thereof which has been
called for redemption on a Redemption Date, or is repurchasable on a Repurchase
Date, occurring, in either case, within such Record Date Period (including any
Securities or portions thereof called for redemption on a Redemption Date or
submitted for repurchase on a Repurchase Date that is a Regular Record Date or
an Interest Payment Date, as the case may be)) be accompanied by payment in New
York Clearing House funds or other funds acceptable to the Company of an amount
equal to the interest payable on such Interest Payment Date on the principal
amount of such Security (or part thereof, as the case may be) being surrendered
for conversion. The interest so payable on such Interest Payment Date with
respect to any Security (or portion thereof, if applicable) which has been
called for redemption on a Redemption Date, or is repurchasable on a Repurchase
Date, occurring, in either case, during the Record Date Period (including any
securities or portions thereof called for redemption on a Redemption Date or
submitted for repurchase on a Repurchase Date that is a Regular Record Date or
Interest Payment Date, as the case may be), which Security (or portion thereof,
if applicable) is surrendered for conversion during the Record Date Period (or
on the last Business Day prior to the Regular Record Date or Interest Payment
Date in the case of any Security (or portion thereof, as the ease may be) called
for redemption on a Redemption Date or submitted for repurchase on a Repurchase
Date on such Regular Record Date or Interest Payment Date, as the case may be)
shall be paid to the Holder of such Security as of such Regular Record Date in
an amount equal to the interest that would have been payable on such Security if
such Security had been converted as of the close of business on such Interest
Payment Date. The interest so payable on

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<PAGE>   87

such Interest Payment Date in respect of any Security (or portion thereof, as
the case may be) which has not been called for redemption on a Redemption Date,
or is not eligible for repurchase on a Repurchase Date, occurring, in either
case, during the Record Date Period, which Security (or portion thereof, as the
case may be) is surrendered for conversion during the Record Date Period, shall
be paid to the Holder of such Security as of such Regular Record Date in an
amount equal to the interest that would have been payable on such Security if
such Security had been converted as of the close of business on such Interest
Payment Date. Interest payable in respect of any Security surrendered for
conversion on or after an Interest Payment Date shall be paid to the Holder of
such Security as of the next preceding Regular Record Date, notwithstanding the
exercise of the right of conversion. Except as provided in this paragraph and
subject to the last paragraph of Section 3.7, no cash payment or adjustment
shall be made upon any conversion on account of any interest accrued from the
Interest Payment Date next preceding the conversion date, in respect of any
Security (or part thereof, as the case may be) surrendered for conversion, or on
account of any dividends on the Common Stock issued upon conversion. The
Company's delivery to the Holder of the number of shares of Common Stock (and
cash in lieu of fractions thereof, as provided in this Indenture) into which a
Security is convertible will be deemed to satisfy the Company's obligation to
pay the principal amount of the Security.

                  Securities shall be deemed to have been converted immediately
prior to the close of business on the day of surrender of such Securities for
conversion in accordance with the foregoing provisions, and at such time the
rights of the Holders of such Securities as Holders shall cease, and the Person
or Persons entitled to receive the Common Stock issuable upon conversion shall
be treated for all purposes as the record holder or holders of such Common Stock
at such time. As promptly as practicable on or after the conversion date, the
Company shall issue and deliver to the Trustee, for delivery to the Holder, a
certificate or certificates for the number of full shares of Common Stock
issuable upon conversion, together with payment in lieu of any fraction of a
share, as provided in Section 12.3.

                  All shares of Common Stock delivered upon such conversion of
Restricted Securities shall bear restrictive legends substantially in the form
of the legends required to be set forth on the Restricted Securities pursuant to
Section 3.5 and shall be subject to the restrictions on transfer provided in
such legends. Neither the Trustee nor any agent maintained for the purpose of
such conversion shall have any responsibility for the inclusion or content of
any such restrictive legends on such Common Stock; provided, however, that the
Trustee or any agent maintained for the purpose of such conversion shall have
provided, to the Company or to the Company's transfer agent for such Common
Stock, prior to or concurrently with a request to the Company to deliver such
Common Stock, written notice that the Securities delivered for conversion are
Restricted Securities.

                  In the case of any Security which is converted in part only,
upon such conversion the Company shall execute and the Trustee shall
authenticate and deliver to the Holder thereof, at the expense of the Company, a
new Security or Securities of authorized denominations in an aggregate principal
amount equal to the unconverted portion of the principal amount of such
Security. A Security may be converted in part, but only if the principal amount
of such Security

                                       80
<PAGE>   88

to be converted is any integral multiple of U.S. $1,000 and the principal amount
of such security to remain Outstanding after such conversion is equal to U.S.
$1,000 or any integral multiple of $1,000 in excess thereof.

                  If shares of Common Stock to be issued upon conversion of a
Restricted Security, or Securities to be issued upon conversion of a Restricted
Security in part only, are to be registered in a name other than that of the
beneficial owner of such Restricted Security, then such Holder must deliver to
the Conversion Agent a Surrender Certificate, dated the date of surrender of
such Restricted Security and signed by such beneficial owner, as to compliance
with the restrictions on transfer applicable to such Restricted Security.
Neither the Trustee nor any Conversion Agent, Registrar or Transfer Agent shall
be required to register in a name other than that of the beneficial owner,
shares of Common Stock or Securities issued upon conversion of any such
Restricted Security not so accompanied by a properly completed Surrender
Certificate.

SECTION 12.3      Fractions of Shares.

                  No fractional shares of Common Stock shall be issued upon
conversion of any Security or Securities. If more than one Security shall be
surrendered for conversion at one time by the same Holder, the number of full
shares which shall be issuable upon conversion thereof shall be computed on the
basis of the aggregate principal amount of the Securities (or specified portions
thereof) so surrendered. Instead of any fractional share of Common Stock which
would otherwise be issuable upon conversion of any Security or Securities (or
specified portions thereof), the Company shall calculate and pay a cash
adjustment in respect of such fraction (calculated to the nearest l/100th of a
share) in an amount equal to the same fraction of the Closing Price Per Share at
the close of business on the day of conversion.

SECTION 12.4      Adjustment of Conversion Rate.

                  The Conversion Rate shall be subject to adjustments from time
to time as follows:

                  (1) In case the Company shall pay or make a dividend or other
distribution on shares of any class of capital stock payable in shares of Common
Stock, the Conversion Rate in effect at the opening of business on the day
following the date fixed for the determination of shareholders entitled to
receive such dividend or other distribution shall be increased by dividing such
Conversion Rate by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding at the close of business on the date fixed
for such determination and the denominator shall be the sum of such number of
shares and the total number of shares constituting such dividend or other
distribution, such increase to become effective immediately after the opening of
business on the day following the date fixed for such determination. If, after
any such date fixed for determination, any dividend or distribution is not in
fact paid, the Conversion Rate shall be immediately readjusted, effective as of
the date the Board of Directors determines not to pay such dividend or
distribution, to the Conversion Rate that would have been in effect if such
determination date had not been fixed. For the purposes of this paragraph (1),
the number of shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include shares issuable in
respect of scrip certificates issued in

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<PAGE>   89

lieu of fractions of shares of Common Stock. The Company will not pay any
dividend or make any distribution on shares of Common Stock held in the treasury
of the Company.

                  (2) In case the Company shall issue rights, options or
warrants to all holders of its Common Stock entitling them to subscribe for or
purchase shares of Common Stock at a price per share less than the current
market price per share (determined as provided in paragraph (8) of this Section
12.4) of the Common Stock on the date fixed for the determination of
stockholders entitled to receive such rights, options or warrants (other than
any rights, options or warrants that by their terms will also be issued to any
Holder upon conversion of a Security into shares of Common Stock without any
action required by the Company or any other Person), the Conversion Rate in
effect at the opening of business on the day following the date fixed for such
determination shall be increased by dividing such Conversion Rate by a fraction
of which the numerator shall be the number of shares of Common Stock outstanding
at the close of business on the date fixed for such determination plus the
number of shares of Common Stock which the aggregate of the offering price of
the total number of shares of Common Stock so offered for subscription or
purchase would purchase at such current market price and the denominator shall
be the number of shares of Common Stock outstanding at the close of business on
the date fixed for such determination plus the number of shares of Common Stock
so offered for subscription or purchase, such increase to become effective
immediately after the opening of business on the day following the date fixed
for such determination. If, after any such date fixed for determination, any
such rights, options or warrants are not in fact issued, or are not exercised
prior to the expiration thereof, the Conversion Rate shall be immediately
readjusted, effective as of the date such rights, options or warrants expire, or
the date the Board of Directors determines not to issue such rights, options or
warrants, to the Conversion Rate that would have been in effect if the
unexercised rights, options or warrants had never been granted or such
determination date had not been fixed, as the case may be. For the purposes of
this paragraph (2), the number of shares of Common Stock at any time outstanding
shall not include shares held in the treasury of the Company but shall include
shares issuable in respect of scrip certificates issued in lieu of fractions of
shares of Common Stock. The Company will not issue any rights, options or
warrants in respect of shares of Common Stock held in the treasury of the
Company.

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

                  (4) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock evidences of its indebtedness,
shares of any class of capital stock or other assets (including securities, but
excluding (i) any rights, options or warrants referred to

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<PAGE>   90

in paragraph (2) of this Section, (ii) any dividend or distribution paid
exclusively in cash, (iii) any dividend or distribution referred to in paragraph
(1) of this Section and (iv) mergers or consolidations to which Section 12.11
applies), the Conversion Rate shall be adjusted so that the same shall equal the
rate determined by dividing the Conversion Rate in effect immediately prior to
the close of business on the date fixed for the determination of stockholders
entitled to receive such distribution by a fraction of which the numerator shall
be the current market price per share (determined as provided in paragraph (8)
of this Section 12.4) of the Common Stock on the date fixed for such
determination less the then fair market value (as determined by the Board of
directors, whose determination shall be conclusive and described in a Board
Resolution filed with the Trustee) of the portion of the assets, shares or
evidences of indebtedness so distributed applicable to one share of Common Stock
and the denominator shall be such current market price per share of the Common
Stock, such adjustment to become effective immediately prior to the opening of
business on the day following the date fixed for the determination of
stockholders entitled to receive such distribution. If after any such date fixed
for determination, any such distribution is not in fact made, the Conversion
Rate shall be immediately readjusted, effective as of the date of the Board of
Directors determines not to make such distribution, to the Conversion Rate that
would have been in effect if such determination date had not been fixed.

                  (5) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock cash (excluding any cash that is
distributed as part of a distribution referred to in paragraph (4) of this
Section or cash distributed upon a merger or consolidation to which Section
12.11 applies) in an aggregate amount that, combined together with (I) the
aggregate amount of any other cash distributions to all holders of its Common
Stock made exclusively in cash within the 12 months preceding the date of
payment of such distribution and in respect of which no adjustment pursuant to
this paragraph (5) has been made and (II) the aggregate of any cash plus the
fair market value (as determined by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution) of consideration
payable in respect of any tender offer by the Company or any of its Subsidiaries
for all or any portion of the Common Stock concluded within the 12 months
preceding the date of payment of such distribution and in respect of which no
adjustment pursuant to paragraph (6) of this Section 12.4 has been made (the
"combined cash and tender amount") exceeds 10% of the product of the current
market price per share (determined as provided in paragraph (8) of this Section
12.4) of the Common Stock on the date for the determination of holders of shares
of Common Stock entitled to receive such distribution times the number of shares
of Common Stock outstanding on such date (the "aggregate current market price"),
then, and in each such case, immediately after the close of business on such
date for determination, the Conversion Rate shall be adjusted so that the same
shall equal the rate determined by dividing the Conversion Rate in effect
immediately prior to the close of business on the date fixed for determination
of the stockholders entitled to receive such distribution by a fraction (i) the
numerator of which shall be equal to the current market price per share
(determined as provided in paragraph (8) of this Section) of the Common Stock on
the date fixed for such determination less an amount equal to the quotient of
(x) the excess of such combined cash and tender amount over such aggregate
current market price divided by (y) the number of shares of Common Stock
outstanding on such date for determination and (ii) the denominator of which
shall be equal to the current market price per

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<PAGE>   91

share (determined as provided in paragraph (8) of this Section 12.4) of the
Common Stock on such date fixed for determination.

                  (6) In case a tender offer made by the Company or any
Subsidiary for all or any portion of the Common Stock shall expire and such
tender offer (as amended upon the expiration thereof) shall require the payment
to stockholders (based on the acceptance (up to any maximum specified in the
terms of the tender offer) of Purchased Shares (as defined below)) of an
aggregate consideration having a fair market value (as determined by the Board
of Directors, whose determination shall be conclusive and described in a Board
Resolution) that combined together with (I) the aggregate of the cash plus the
fair market value (as determined by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution), as of the expiration
of such tender offer, of consideration payable in respect of any other tender
offer by the Company or any Subsidiary for all or any portion of the Common
Stock expiring within the 12 months preceding the expiration of such tender
offer and in respect of which no adjustment pursuant to this paragraph (6) has
been made and (II) the aggregate amount of any cash distributions to all holders
of the Common Stock within 12 months preceding the expiration of such tender
offer and in respect of which no adjustment pursuant to paragraph (5) of this
Section has been made (the "combined tender and cash amount") exceeds 10% of the
product of the current market price per share of the Common Stock (determined as
provided in paragraph (8) of this Section 12.4) as of the last time (the
"Expiration Time") tenders could have been made pursuant to such tender offer
(as it may be amended) times the number of shares of Common Stock outstanding
(including any tendered shares) as of the Expiration Time, then, and in each
such case immediately prior to the opening of business on the day after the date
of the Expiration Time, the Conversion Rate shall be adjusted so that the same
shall equal the rate determined by dividing the Conversion Rate immediately
prior to close of business on the date of the Expiration Time by a fraction (i)
the numerator of which shall be equal to (A) the product of (I) the current
market price per share of the Common Stock (determined as provided in paragraph
(8) of this Section 12.4) on the date of the Expiration Time multiplied by (II)
the number of shares of Common Stock outstanding (including any tendered shares)
on the Expiration Time less (B) the combined tender and cash amount, and (ii)
the denominator of which shall be equal to the product of (A) the current market
price per share of the Common Stock (determined as provided in paragraph (8) of
this Section 12.4) as of the Expiration Time multiplied by (B) the number of
shares of Common Stock outstanding (including any tendered shares) as of the
Expiration Time less the number of all shares validly tendered and not withdrawn
as of the Expiration Time (the shares deemed so accepted up to any such maximum,
being referred to as the "Purchased Shares").

                  (7) The reclassification of Common Stock into securities other
than Common Stock (other than any reclassification upon a consolidation or
merger to which Section 12.11 applies) shall be deemed to involve (a) a
distribution of such securities other than Common Stock to all holders of Common
Stock (and the effective date of such reclassification shall be deemed to be
"the date fixed for the determination of stockholders entitled to receive such
distribution" and "the date fixed for such determination" within the meaning of
paragraph (4) of this Section), and (b) a subdivision or combination, as the
case may be, of the number of shares

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<PAGE>   92

of Common Stock outstanding immediately prior to such reclassification into the
number of shares of Common Stock outstanding immediately thereafter (and the
effective date of such reclassification shall be deemed to be "the day upon
which such subdivision becomes effective" or "the day upon which such
combination becomes effective", as the case may be, and "the day upon which such
subdivision or combination becomes effective" within the meaning of paragraph
(3) of this Section 12.4).

                  (8) For the purpose of any computation under paragraphs (2),
(4), (5) or (6) of this Section 12.4, the current market price per share of
Common Stock on any date shall be calculated by the Company and be the average
of the daily Closing Prices Per Share for the five consecutive Trading Days
selected by the Company commencing not more than 10 Trading Days before, and
ending not later than the earlier of the day in question and the day before the
"ex" date with respect to the issuance or distribution requiring such
computation. For purposes of this paragraph, the term "`ex' date", when used
with respect to any issuance or distribution, means the first date on which the
Common Stock trades regular way in the applicable securities market or on the
applicable securities exchange without the right to receive such issuance or
distribution.

                  (9) No adjustment in the Conversion Rate shall be required
unless such adjustment (plus any adjustments not previously made by reason of
this paragraph (9)) would require an increase or decrease of at least one
percent in such rate; provided, however, that any adjustments which by reason of
this paragraph (9) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment. All calculations under this
Article shall be made to the nearest cent or to the nearest one-hundredth of a
share, as the case may be.

                  (10) The Company may make such increases in the Conversion
Rate, for the remaining term of the Securities or any shorter term, in addition
to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section
12.4, as it considers to be advisable in order to avoid or diminish any income
tax to any holders of shares of Common Stock resulting from any dividend or
distribution of stock or issuance of rights or warrants to purchase or subscribe
for stock or from any event treated as such for income tax purposes. The Company
shall have the power to resolve any ambiguity or correct any error in this
paragraph (10) and its actions in so doing shall, absent manifest error, be
final and conclusive.

                  (11) Notwithstanding the foregoing provisions of this Section,
no adjustment of the Conversion Rate shall be required to be made (a) upon the
issuance of shares of Common Stock pursuant to any present or future plan for
the reinvestment of dividends or (b) because of a tender or exchange offer of
the character described in Rule 13e-4(h)(5) under the Exchange Act or any
successor rule thereto.

                  (12) To the extent permitted by applicable law, the Company
from time to time may increase the Conversion Rate by any amount for any period
of time if the period is at least twenty (20) days, the increase is irrevocable
during such period, and the Board of Directors shall have made a determination
that such increase would be in the best interests of the Company, which
determination shall be conclusive; provided, however, that no such increase
shall be taken

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<PAGE>   93

into account for purposes of determining whether the Closing Price Per Share of
the Common Stock equals or exceeds 105% of the Conversion Price in connection
with an event which would otherwise be a Change of Control pursuant to Section
14.4. Whenever the Conversion Rate is increased pursuant to the preceding
sentence, the Company shall give notice of the increase to the Holders in the
manner provided in Section 1.6 at least fifteen (15) days prior to the date the
increased Conversion Rate takes effect, and such notice shall state the
increased Conversion Rate and the period during which it will be in effect.

SECTION 12.5      Notice of Adjustments of Conversion Rate.

Whenever the Conversion Rate is adjusted as herein provided:

                  (1) the Company shall compute the adjusted Conversion Rate in
accordance with Section 12.4 and shall prepare a certificate signed by the Chief
Financial Officer of the Company setting forth the adjusted Conversion Rate and
showing in reasonable detail the facts upon which such adjustment is based, and
such certificate shall promptly be filed with the Trustee and with each
Conversion Agent; and

                  (2) upon each such adjustment, a notice stating that the
Conversion Rate has been adjusted and setting forth the adjusted Conversion Rate
shall be required, and as soon as practicable after it is required, such notice
shall be provided by the Company to all Holders in accordance with Section 1.6.

Neither the Trustee nor any Conversion Agent shall be under any duty or
responsibility with respect to any such certificate or the information and
calculations contained therein, except to exhibit the same to any Holder of
Securities desiring inspection thereof at its office during normal business
hours.

SECTION 12.6      Notice of Certain Corporate Action.

In case:

                  (1) the Company shall declare a dividend (or any other
distribution) on its Common Stock payable (i) otherwise than exclusively in cash
or (ii) exclusively in cash in an amount that would require any adjustment
pursuant to Section 12.4; or

                  (2) the Company shall authorize the granting to all or
substantially all of the holders of its Common Stock of rights, options or
warrants to subscribe for or purchase any shares of capital stock of any class
or of any other rights; or

                  (3) of any reclassification of the Common Stock, or of any
consolidation, merger or share exchange to which the Company is a party and for
which approval of any stockholders of the Company is required, or of the
conveyance, sale, transfer or lease of all or substantially all of the assets of
the Company; or

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<PAGE>   94

                  (4) of the voluntary or involuntary dissolution, liquidation
or winding up of the Company;

then the Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of Securities pursuant to Section 10.2, and shall
cause to be provided to all Holders in accordance with Section 1.6, at least 20
days (or 10 days in any case specified in clause (1) or (2) above) prior to the
applicable record or effective date hereinafter specified, a notice stating (x)
the date on which a record is to be taken for the purpose of such dividend,
distribution, rights, options or warrants, or, if a record is not to be taken,
the date as of which the holders of Common Stock of record to be entitled to
such dividend, distribution, rights, options or warrants are to be determined or
(y) the date on which such reclassification, consolidation, merger, conveyance,
transfer, sale, lease, dissolution, liquidation or winding up is expected to
become effective, and the date as of which it is expected that holders of Common
Stock of record shall be entitled to exchange their shares of Common Stock for
securities, cash or other property deliverable upon such reclassification,
consolidation, merger, conveyance, transfer, sale, lease, dissolution,
liquidation or winding up. Neither the failure to give such notice or the notice
referred to in the following paragraph nor any defect therein shall affect the
legality or validity of the proceedings described in clauses (1) through (4) of
this Section 12.6. If at the time the Trustee shall not be the conversion agent,
a copy of such notice shall also forthwith be filed by the Company with the
Trustee.

                  The Company shall cause to be filed at the Corporate Trust
Office and each office or agency maintained for the purpose of conversion of
Securities pursuant to Section 10.2, and shall cause to be provided to all
Holders in accordance with Section 1.6, notice of any tender offer by the
Company or any Subsidiary for all or any portion of the Common Stock at or about
the time that such notice of tender offer is provided to the public generally.

SECTION 12.7      Company to Reserve Common Stock.

                  The Company shall at all times reserve and keep available,
free from preemptive rights, out of its authorized but unissued Common Stock,
for the purpose of effecting the conversion of Securities, the full number of
shares of Common Stock then issuable upon the conversion of all Outstanding
Securities.

SECTION 12.8      Taxes on Conversions.

                  Except as provided in the next sentence, the Company will pay
any and all taxes and duties that may be payable in respect of the issue or
delivery of shares of Common Stock on conversion of Securities pursuant hereto.
The Company shall not, however, be required to pay any tax or duty which may be
payable in respect of any transfer involved in the issue and delivery of shares
of Common Stock in a name other than that of the Holder of the Security or
Securities to be converted, and no such issue or delivery shall be made unless
and until the Person requesting such issue has paid to the Company the amount of
any such tax or duty, or has established to the satisfaction of the Company that
such tax or duty has been paid.

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<PAGE>   95

SECTION 12.9      Covenant as to Common Stock.

                  The Company agrees that all shares of Common Stock which may
be delivered upon conversion of Securities, upon such delivery, will have been
duly authorized and validly issued and will be fully paid and nonassessable and,
except as provided in Section 12.8, the Company will pay all taxes, liens and
charges with respect to the issue thereof.

SECTION 12.10     Cancellation of Converted Securities.

                  All Securities delivered for conversion shall be delivered to
the Trustee or its agent to be canceled by or at the direction of the Trustee,
which shall dispose of the same as provided in Section 3.9.

SECTION 12.11     Provision in Case of Consolidation, Merger or Sale of Assets.

                  In case of any consolidation or merger of the Company with or
into any other Person, any merger of another Person with or into the Company
(other than a merger which does not result in any reclassification, conversion,
exchange or cancellation of outstanding shares of Common Stock of the Company)
or any conveyance, sale, transfer or lease of all or substantially all of the
assets of the Company, the Person formed by such consolidation or resulting from
such merger or which acquires such assets, as the case may be, shall execute and
deliver to the Trustee a supplemental indenture providing that the Holder of
each Security then Outstanding shall have the right thereafter, during the
period such Security shall be convertible as specified in Section 12.1, to
convert such Security only into the kind and amount of securities, cash and
other property receivable upon such consolidation, merger, conveyance, sale,
transfer or lease by a holder of the number of shares of Common Stock of the
Company into which such Security might have been converted immediately prior to
such consolidation, merger, conveyance, sale, transfer or lease, assuming such
holder of Common Stock of the Company (i) is not (A) a Person with which the
Company consolidated or merged with or into or which merged into or with the
Company or to which such conveyance, sale, transfer or lease was made, as the
case may be (a "Constituent Person"), or (B) an Affiliate of a Constituent
Person and (ii) failed to exercise his rights of election, if any, as to the
kind or amount of securities, cash and other property receivable upon such
consolidation, merger, conveyance, sale, transfer or lease (provided that if the
kind or amount of securities, cash and other property receivable upon such
consolidation, merger, conveyance, sale, transfer, or lease is not the same for
each share of Common Stock of the Company held immediately prior to such
consolidation, merger, conveyance, sale, transfer or lease by others than a
Constituent Person or an Affiliate thereof and in respect of which such rights
of election shall not have been exercised ("Non-electing Share"), then for the
purpose of this Section 12.11 the kind and amount of securities, cash and other
property receivable upon such consolidation, merger, conveyance, sale, transfer
or lease by the holders of each Non-electing Share shall be deemed to be the
kind and amount so receivable per share by a plurality of the Non-electing
Shares). Such supplemental indenture shall provide for adjustments which, for
events subsequent to the effective date of such supplemental indenture, shall be
as nearly equivalent as may be practicable to the adjustments provided for in
this Article. The above

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<PAGE>   96

provisions of this Section 12.11 shall similarly apply to successive
consolidations, mergers, conveyances, sales, transfers or leases. Notice of the
execution of such a supplemental indenture shall be given by the Company to the
Holder of each Security as provided in Section 1.6 promptly upon such execution.

                  Neither the Trustee nor any Conversion Agent shall be under
any responsibility to determine the correctness of any provisions contained in
any such supplemental indenture relating either to the kind or amount of shares
of stock or other securities or property or cash receivable by Holders of
Securities upon the conversion of their Securities after any such consolidation,
merger, conveyance, transfer, sale or lease or to any such adjustment, but may
accept as conclusive evidence of the correctness of any such provisions, and
shall be protected in relying upon, an Opinion of Counsel with respect thereto,
which the Company shall cause to be furnished to the Trustee upon request.

SECTION 12.12      Rights Issued in Respect of Common Stock Issued Upon
                   Conversion.

                  Each share of Common Stock issued upon conversion of
Securities pursuant to this Article 12 shall be entitled to receive the
appropriate number of Rights, if any, and the certificates representing the
Common Stock issued upon such conversion shall bear such legends, if any, in
each case as provided by and subject to the terms of the Rights Agreement as in
effect at the time of such conversion. If the Rights are separated from the
Common Stock in accordance with the provisions of the Rights Agreement such that
the Holders of Securities would thereafter not be entitled to receive any such
Rights in respect to the Common Stock issuable upon conversion of such
Securities, the Conversion Price will be adjusted as provided in Section 12.4(2)
on the Distribution Date; provided that if such Rights expire, terminate or are
redeemed by the Company, the Conversion Price shall again be adjusted to be the
Conversion Price which would then be in effect if the separation of the rights
and the Common Stock had not occurred. In lieu of any such adjustment, the
Company may amend the Rights Agreement to provide that upon conversion of the
Securities the Holders will receive, in addition to the Common Stock issuable
upon such conversion, the Rights which would have attached to such shares of
Common Stock if the Rights had not become separated from the Common Stock
pursuant to the provisions of the Rights Agreement.

                  Rights or warrants distributed by the Company to all holders
of Common Stock entitling the holders thereof to subscribe for or purchase
shares of the Company's capital stock (either initially or under certain
circumstances), which rights or warrants, until the occurrence of a specified
event or events ("Trigger Event"):

                  (i)      are deemed to be transferred with such shares of
                           Common Stock,

                  (ii)     are not exercisable, and

                  (iii)    are also issued in respect of future issuances of
                           Common Stock,

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<PAGE>   97

shall not be deemed distributed for purposes of Section 12.4(2) until the
occurrence of the earliest Trigger Event. In addition, in the event of any
distribution of rights or warrants, or any Trigger Event with respect thereto,
that shall have resulted in an adjustment to the Conversion Price under Section
12.4(2), (1) in the case of any such rights or warrants which shall all have
been redeemed or repurchased without exercise by any holders thereof, the
Conversion Price shall be readjusted upon such final redemption or repurchase to
give effect to such distribution or Trigger Event, as the case may be, as though
it were a cash distribution, equal to the per share redemption or repurchase
price received by a holder of Common Stock with respect to such rights or
warrants (assuming such holder had retained such rights or warrants), made to
all holders of Common Stock as of the date of such redemption or repurchase, and
(2) in the case of any such rights or warrants all of which shall have expired
without exercise by any holder thereof, the Conversion Price shall be readjusted
as if such issuance had not occurred.

SECTION 12.13     Responsibility of Trustee for Conversion Provisions.

                  The Trustee, subject to the provisions of Section 6.1, and any
Conversion Agent shall not at any time be under any duty or responsibility to
any Holder of Securities to determine whether any facts exist which may require
any adjustment of the Conversion Rate, or with respect to the nature or extent
of any such adjustment when made, or with respect to the method employed, or
herein or in any supplemental indenture provided to be employed, in making the
same, or whether a supplemental indenture need be entered into. Neither the
Trustee, subject to the provisions of Section 6.1, nor any Conversion Agent
shall be accountable with respect to the validity or value (or the kind or
amount) of any Common Stock, or of any other securities or property or cash,
which may at any time be issued or delivered upon the conversion of any
Security; and it or they do not make any representation with respect thereto.
Neither the Trustee, subject to the provisions of Section 6.1, nor any
Conversion Agent shall be responsible for any failure of the Company to make or
calculate any cash payment or to issue, transfer or deliver any shares of Common
Stock or share certificates or other securities or property or cash upon the
surrender of any Security for the purpose of conversion; and the Trustee,
subject to the provisions of Section 6.1, and any Conversion Agent shall not be
responsible for any failure of the Company to comply with any of the covenants
of the Company contained in this Article.

                                  ARTICLE XIII
                           SUBORDINATION OF SECURITIES

SECTION 13.1      Securities Subordinate to Senior Indebtedness.

                  The Company covenants and agrees, and each Holder of a
Security, by its acceptance thereof, likewise covenants and agrees, that, to the
extent and in the manner hereinafter set forth in this Article (subject to the
provisions of Article IV), the indebtedness represented by the Securities and
the payment of the principal of, or premium, if any, or interest (including
Liquidated Damages, if any) on, each and all of the Securities (including, but
not limited to, the Redemption Price with respect to the Securities to be called
for redemption in accordance with Article XI or the Repurchase Price with
respect to Securities submitted for

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<PAGE>   98

repurchase in accordance with Article XIV), are hereby expressly made
subordinate and subject in right of payment to the prior payment in full of all
Senior Indebtedness.

SECTION 13.2      No Payment in Certain Circumstances, Payment Over of Proceeds
                  Upon Dissolution, Etc.

                  No payment shall be made with respect to the principal of, or
premium, if any, or interest (including Liquidated Damages, if any) on the
Securities (including, but not limited to, the Redemption Price with respect to
the Securities to be called for redemption in accordance with Article XI or the
Repurchase Price with respect to Securities submitted for repurchase in
accordance with Article XIV), except payments and distributions made by the
Trustee as permitted by Section 13.9, if:

                  (i) a default in the payment of principal, premium, if any, or
interest (including a default under any repurchase or redemption obligation) or
other amounts with respect to any Senior Indebtedness occurs and is continuing
(or, in the case of Senior Indebtedness for which there is a period of grace, in
the event of such a default that continues beyond the period of grace, if any,
specified in the instrument or lease evidencing such Senior Indebtedness) unless
and until such default shall have been cured or waived or shall have ceased to
exist; or

                  (ii) a default, other than a payment default, on any
Designated Senior Indebtedness occurs and is continuing that then permits
holders of such Designated Senior Indebtedness to accelerate its maturity and
the Trustee receives a notice of the default (a "Payment Blockage Notice") from
a Representative of Designated Senior Indebtedness or the Company.

                  If the Trustee receives any Payment Blockage Notice pursuant
to clause (ii) above, no subsequent Payment Blockage Notice shall be effective
for purposes of this Section unless and until (A) at least 365 days shall have
elapsed since the initial effectiveness of the immediately prior Payment
Blockage Notice, and (B) all scheduled payments of principal, premium, if any,
and interest on the Securities that have come due have been paid in full in
cash. No nonpayment default that existed or was continuing on the date of
delivery of any Payment Blockage Notice to the Trustee shall be, or be made, the
basis for a subsequent Payment Blockage Notice.

                  The Company may and shall resume payments on and distributions
in respect of the Securities upon the earlier of:

                  (1) the date upon which the default is cured or waived or
ceases to exist, or

                  (2) in the case of a default referred to in clause (ii) above,
179 days pass after notice is received if the maturity of such Designated Senior
Indebtedness has not been accelerated, unless this Article XIII otherwise
prohibits the payment or distribution at the time of such payment or
distribution.

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                  In the event of (a) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding in connection therewith, relative to the Company or to its
creditors, as such, or to its assets, or (b) any liquidation, dissolution or
other winding up of the Company, whether voluntary or involuntary and whether or
not involving insolvency or bankruptcy, or (c) any assignment for the benefit of
creditors or any other marshaling of assets and liabilities of the Company, then
and in any such event the holders of Senior Indebtedness shall be entitled to
receive payment in full of all amounts due or to become due on or in respect of
all Senior Indebtedness in cash before the Holders of the Securities are
entitled to receive any payment on account of principal of (or premium, if any)
or interest (including any Liquidated Damages) on the Securities or on account
of the purchase, redemption or other acquisition of Securities, and to that end
the holders of Senior Indebtedness shall be entitled to receive, for application
to the payment thereof, any payment or distribution of any kind or character,
whether in cash, property or securities, which may be payable or deliverable in
respect of the Securities in any such case, proceeding, dissolution, liquidation
or other winding up or event.

                  In the event that, notwithstanding the foregoing provisions of
this Section, the Trustee or the Holder of any Security shall have received any
payment or distribution of assets of the Company of any kind or character,
whether in cash, securities or other property, before all Senior Indebtedness is
paid in full, and if such fact shall, at or prior to the time of such payment or
distribution, have been made known to the Trustee or, as the case may be, such
Holder, then and in such event such payment or distribution shall be paid over
or delivered forthwith to the trustee in bankruptcy, receiver, liquidating
trustee, custodian, assignee, agent or other Person making payment or
distribution of assets of the Company for application to the payment of all
Senior Indebtedness remaining unpaid, to the extent necessary to pay all Senior
Indebtedness in full, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness.

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

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

SECTION 13.3      Prior Payment to Senior Indebtedness Upon Acceleration of
                  Securities.

                  In the event of the acceleration of the Securities because of
an Event of Default, no payment or distribution shall be made to the Trustee or
any holder of Securities in respect of the principal of, premium, if any, or
interest (including Liquidated Damages, if any) on the Securities (including,
but not limited to, the Redemption Price with respect to the Securities called
for redemption in accordance with Article XI or the Repurchase Price with
respect to the Securities submitted for repurchase in accordance with Article
XIV), except payments and distributions made by the Trustee as permitted by
Section 13.9, until all Senior Indebtedness has been paid in full in cash or
other payment satisfactory to the holders of Senior Indebtedness or such
acceleration is rescinded in accordance with the terms of this Indenture. If
payment of the Securities is accelerated because of an Event of Default, the
Company shall promptly notify holders of Senior Indebtedness of the
acceleration, and the Trustee shall promptly notify Wells Fargo Bank (Texas),
National Association, as Agent for the lenders under the Credit Agreement and
Bank One, Texas, N.A., as Co-Agent for the lenders under the Credit Agreement,
of such acceleration, at the address set forth in the notice from such Agent and
Co-Agent to the Trustee as being the address to which the Trustee should send
its notice pursuant to this Section 13.3, unless, in each case, there are no
payment obligations of the Company thereunder and all obligations thereunder to
extend credit have been terminated or expired.

SECTION 13.4      Payment Permitted If No Default.

                  Nothing contained in this Article or elsewhere in this
Indenture or in any of the Securities shall prevent (a) the Company, at any time
except during the pendency of any case, proceeding, dissolution, liquidation or
other winding up, assignment for the benefit of creditors or other marshaling of
assets and liabilities of the Company referred to in Section 13.2, or during the
circumstances referred to in the first paragraph of Section 13.2, or under the
conditions described in Section 13.3, from making payments at any time of
principal of (and premium, if any) or interest on the Securities, or (b) the
application by the Trustee of any money deposited with it hereunder to the
payment of or on account of the principal of (and premium, if any) or interest
on the Securities or the retention of such payment by the Holders, if, at the
time of such application by the Trustee, it did not have knowledge that such
payment would have been prohibited by the provisions of this Article.

SECTION 13.5      Subrogation to Rights of Holders of Senior Indebtedness.

                  Subject to the payment in full of all Senior Indebtedness, the
Holders of the Securities shall be subrogated to the extent of the payments or
distributions made to the holders

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of such Senior Indebtedness pursuant to the provisions of this Article to the
rights of the holders of such Senior Indebtedness to receive payments and
distributions of cash, property and securities applicable to the Senior
Indebtedness until the principal of (and premium, if any) and interest on the
Securities shall be paid in full. For purposes of such subrogation, no payments
or distributions to the holders of the Senior Indebtedness of any cash, property
or securities to which the Holders of the Securities or the Trustee would be
entitled except for the provisions of this Article, and no payments over
pursuant to the provisions of this Article to the holders of Senior Indebtedness
by Holders of the Securities or the Trustee, shall, as among the Company, its
creditors other than holders of Senior Indebtedness and the Holders of the
Securities, be deemed to be a payment or distribution by the Company to or on
account of the Senior Indebtedness.

SECTION 13.6      Provisions Solely to Define Relative Rights.

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

SECTION 13.7      Trustee to Effectuate Subordination.

                  Each Holder of a Security by its acceptance thereof authorizes
and directs the Trustee on its behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article and
appoints the Trustee its attorney-in-fact for any and all such purposes.

SECTION 13.8      No Waiver of Subordination Provisions.

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

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

SECTION 13.9      Notice to Trustee.

                  The Company shall give prompt written notice to the Trustee of
any fact known to the Company which would prohibit the making of any payment to
or by the Trustee in respect of the Securities. Notwithstanding the provisions
of this Article or any other provision of this Indenture, the Trustee shall not
be charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee in respect of the Securities, unless
and until the Trustee shall have received written notice thereof from the
Company or a Representative or a holder of Senior Indebtedness (including,
without limitation, a holder of Designated Senior Indebtedness) and, prior to
the receipt of any such written notice, the Trustee, subject to the provisions
of Section 6.1, shall be entitled in all respects to assume that no such facts
exist; provided, however, that if the Trustee shall not have received the notice
provided for in this Section 13.9 prior to the date upon which by the terms
hereof any money may become payable for any purpose (including, without
limitation, the payment of the principal of (and premium, if any) or interest
(including Liquidated Damages, if any) on any Security), then, anything herein
contained to the contrary notwithstanding, the Trustee shall have full power and
authority to receive such money and to apply the same to the purpose for which
such money was received and shall not be affected by any notice to the contrary
which may be received by it within one Business Day prior to such date.

                  Notwithstanding anything in this Article XIII to the contrary,
nothing shall prevent any payment by the Trustee to the Holders of monies
deposited with it pursuant to Section 4.1, and any such payment shall not be
subject to the provisions of Section 13.2 or 13.3.

                  Subject to the provisions of Section 6.1, the Trustee shall be
entitled to rely on the delivery to it of a written notice by a Person
representing himself to be a Representative or a holder of Senior Indebtedness
(including, without limitation, a holder of Designated Senior Indebtedness) to
establish that such notice has been given by a Representative or a holder of
Senior Indebtedness (including, without limitation, a holder of Designated
Senior Indebtedness). In the event that the Trustee determines in good faith
that further evidence is required with respect to the right of any Person as a
holder of Senior Indebtedness to participate in any

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<PAGE>   103

payment or distribution pursuant to this Article, the Trustee may request such
Person to furnish evidence to the reasonable satisfaction of the Trustee as to
the amount of Senior Indebtedness held by such Person, the extent to which such
Person is entitled to participate in such payment or distribution and any other
facts pertinent to the rights of such Person under this Article, and if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.

SECTION 13.10     Reliance on Judicial Order or Certificate of Liquidating
                  Agent.

                  Upon any payment or distribution of assets of the Company
referred to in this Article, the Trustee, subject to the provisions of Section
6.1, and the Holders of the Securities shall be entitled to rely upon any order
or decree entered by any court of competent jurisdiction in which such
insolvency, bankruptcy, receivership, liquidation, reorganization, dissolution,
winding up or similar case or proceeding is pending, or a certificate of the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee for
the benefit of creditors, agent or other Person making such payment or
distribution, delivered to the Trustee or to the Holders of Securities, for the
purpose of ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Indebtedness and other indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Article.

SECTION 13.11     Trustee Not Fiduciary for Holders of Senior Indebtedness.

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

SECTION 13.12     Reliance by Holders of Senior Indebtedness on Subordination
                  Provisions.

                  Each Holder by accepting a Security acknowledges and agrees
that the foregoing subordination provisions are, and are intended to be, an
inducement and a consideration to each holder of any Senior Indebtedness,
whether such Senior Indebtedness was created or acquired before or after the
issuance of the Securities, to acquire and continue to hold, or to continue to
hold, such Senior Indebtedness and such holder of Senior Indebtedness shall be
deemed conclusively to have relied on such subordination provisions in acquiring
and continuing to hold, or in continuing to hold, such Senior Indebtedness, and
no amendment or modification of the provisions contained herein shall diminish
the rights of such holders of Senior Indebtedness unless such holders shall have
agreed in writing thereto.

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SECTION 13.13     Rights of Trustee as Holder of Senior Indebtedness;
                  Preservation of Trustee's Rights.

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

                  Nothing in this Article shall apply to claims of, or payments
to, the Trustee under or pursuant to Section 6.7.

SECTION 13.14     Article Applicable to Paying Agents.

                  In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article shall in such case (unless the context
otherwise requires) be construed as extending to and including such Paying Agent
within its meaning as fully for all intents and purposes as if such Paying Agent
were named in this Article in addition to or in place of the Trustee; provided,
however, that Section 13.13 shall not apply to the Company or any Affiliate of
the Company if it or such Affiliate acts as Paying Agent.

SECTION 13.15     Certain Conversions and Repurchases Deemed Payment.

                  For the purposes of this Article only, (i) the issuance and
delivery of junior securities upon conversion of Securities in accordance with
Article XII or upon the repurchase of Securities in accordance with Article XIV
shall not be deemed to constitute a payment or distribution on account of the
principal of or premium or interest (including Liquidated Damages, if any) on
Securities or on account of the purchase or other acquisition of Securities, and
(ii) the payment, issuance or delivery of cash (except in satisfaction of
fractional shares pursuant to Section 12.3), property or securities (other than
junior securities) upon conversion of a Security shall be deemed to constitute
payment on account of the principal of such Security. For the purposes of this
Section, the term "junior securities" means (a) shares of any stock of any class
of the Company and securities into which the Securities are convertible pursuant
to Article XII and (b) securities of the Company which are subordinated in right
of payment to all Senior Indebtedness which may be outstanding at the time of
issuance or delivery of such securities to substantially the same extent as, or
to a greater extent than, the Securities are so subordinated as provided in this
Article. Nothing contained in this Article or elsewhere in this Indenture or in
the Securities is intended to or shall impair, as among the Company, its
creditors other than holders of Senior Indebtedness and the Holders of the
Securities, the right, which is absolute and unconditional, of the Holder of any
Security to convert such Security in accordance with Article XII or to exchange
such Security for Common Stock in accordance with Article XIV if the Company
elects to satisfy the obligations under Article XIV by the delivery of Common
Stock.

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                                  ARTICLE XIV
                  REPURCHASE OF SECURITIES AT THE OPTION OF THE
                         HOLDER UPON A CHANGE IN CONTROL

SECTION 14.1      Right to Require Repurchase.

                  In the event that a Change in Control (as hereinafter defined)
shall occur, then each Holder shall have the right, at the Holder's option, but
subject to the provisions of Section 14.2, to require the Company to repurchase,
and upon the exercise of such right the Company shall repurchase, all of such
Holder's Securities not theretofore called for redemption, or any portion of the
principal amount thereof that is equal to U.S. $1,000 or any integral multiple
of U.S. $1,000 in excess thereof (provided that no single Security may be
repurchased in part unless the portion of the principal amount of such Security
to be Outstanding after such repurchase is equal to U.S. $1,000 or integral
multiples of U.S. $1,000 in excess thereof), on the date (the "Repurchase Date")
that is 45 days after the date of the Company Notice (as defined in Section
14.3) at a purchase price equal to 100% of the principal amount of the
Securities to be repurchased plus interest accrued to the Repurchase Date (the
"Repurchase Price"); provided, however, that installments of interest on
Securities whose Stated Maturity is on or prior to the Repurchase Date shall be
payable to the Holders of such Securities, or one or more Predecessor
Securities, registered as such on the relevant Record Date according to their
terms and the provisions of Section 3.7. Such right to require the repurchase of
the Securities shall not continue after a discharge of the Company from its
obligations with respect to the Securities in accordance with Article IV, unless
a Change in Control shall have occurred prior to such discharge. At the option
of the Company, the Repurchase Price may be paid in cash or, subject to the
fulfillment by the Company of the conditions set forth Section 14.2, by delivery
of shares of Common Stock having a fair market value equal to the Repurchase
Price. Whenever in this Indenture (including Sections 2.2, 3.1 , 5.1(1) and 5.8)
there is a reference, in any context, to the principal of any Security as of any
time, such reference shall be deemed to include reference to the Repurchase
Price payable in respect of such Security to the extent that such Repurchase
Price is, was or would be so payable at such time, and express mention of the
Repurchase Price in any provision of this Indenture shall not be construed as
excluding the Repurchase Price in those provisions of this Indenture when such
express mention is not made; provided, however, that for the purposes of Article
XIII such reference shall be deemed to include reference to the Repurchase Price
only to the extent the Repurchase Price is payable in cash.

SECTION 14.2      Conditions to the Company's Election to Pay the Repurchase
                  Price in Common Stock.

                  The Company may elect to pay the Repurchase Price by delivery
of shares of Common Stock pursuant to Section 14.1 if and only if the following
conditions shall have been satisfied:

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<PAGE>   106

                  (1) The shares of Common Stock deliverable in payment of the
Repurchase Price shall have a fair market value as of the Repurchase Date of not
less than the Repurchase Price. For purposes of Section 14.1 and this Section
14.2, the fair market value of shares of Common Stock shall be determined by the
Company and shall be equal to 95% of the average of the Closing Prices Per Share
of the Common Stock for the five consecutive Trading Days immediately preceding
and including the third Trading Day prior to the Repurchase Date;

                  (2) The Repurchase Price shall be paid only in cash in the
event any shares of Common Stock to be issued upon repurchase of Securities
hereunder (i) require registration under any federal securities law before such
shares may be freely transferrable without being subject to any transfer
restrictions under the Securities Act upon repurchase and if such registration
is not completed or does not become effective prior to the Repurchase Date,
and/or (ii) require registration with or approval of any governmental authority
under any state law or any other federal law before such shares may be validly
issued or delivered upon repurchase and if such registration is not completed or
does not become effective or such approval is not obtained prior to the
Repurchase Date;

                  (3) Payment of the Repurchase Price may not be made in Common
Stock unless such stock is, or shall have been, approved for listing on the New
York Stock Exchange or listed on a national securities exchange or quoted on the
Nasdaq National Market, in each case, prior to the Repurchase Date; and

                  (4) All shares of Common Stock which may be issued upon
repurchase of Securities will be issued out of the Company's authorized but
unissued Common Stock and, will upon issue, be duly and validly issued and fully
paid and non-assessable and free of any preemptive or similar rights.

                  If all of the conditions set forth in this Section 14.2 are
not satisfied in accordance with the terms thereof, the Repurchase Price shall
be paid by the Company only in cash.

SECTION 14.3      Notices; Method of Exercising Repurchase Right, Etc.

                  (1) Unless the Company shall have theretofore called for
redemption all of the Outstanding Securities, on or before the 30th day after
the occurrence of a Change in Control, the Company or, at the request and
expense of the Company on or before the 30th day after such occurrence, the
Trustee, shall give to all Holders of Securities, in the manner provided in
Section 1.6, notice (the "Company Notice") of the occurrence of the Change of
Control and of the repurchase right set forth herein arising as a result
thereof. The Company shall also deliver (i) a copy of such notice of a
repurchase right to the Trustee and (ii) make a public announcement thereof by
release made to Reuters Economic Services and Bloomberg Business News.

                  Each notice of a repurchase right shall state:

                  (i) the Repurchase Date,

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<PAGE>   107

                  (ii) the date by which the repurchase right must be exercised,

                  (iii) the Repurchase Price, and whether the Repurchase Price
shall be paid by the Company in cash or by delivery of shares of Common Stock,

                  (iv) a description of the procedure which a Holder must follow
to exercise a repurchase right, and the place or places where such Securities,
are to be surrendered for payment of the Repurchase Price and accrued interest,
if any,

                  (v) that on the Repurchase Date the Repurchase Price, and
accrued interest, if any, will become due and payable upon each such Security
designated by the Holder to be repurchased, and that interest thereon shall
cease to accrue on and after said date,

                  (vi) the Conversion Rate then in effect, the date on which the
right to convert the principal amount of the Securities to be repurchased will
terminate and the place or places where such Securities may be surrendered for
conversion, and

                  (vii) the place or places that the Security certificate with
the Election of Holder to Require Repurchase as specified in Section 2.2 shall
be delivered, and if the Security is a Restricted Securities Certificate the
place or places that the Surrender Certificate required by Section 14.3(9) shall
be delivered.

                  No failure of the Company to give the foregoing notices or
defect therein shall limit any Holder' s right to exercise a repurchase right or
affect the validity of the proceedings for the repurchase of Securities.

                  If any of the foregoing provisions or other provisions of this
Article XIV are inconsistent with applicable law, such law shall govern.

                  (2) To exercise a repurchase right, a Holder shall deliver to
the Trustee on or before the 30th day after the date of the Company Notice (i)
written notice of the Holder's exercise of such right, which notice shall set
forth the name of the Holder, the principal amount of the Securities to be
repurchased (and, if any Security is to repurchased in part, the serial number
thereof, the portion of the principal amount thereof to be repurchased and the
name of the Person in which the portion thereof to remain Outstanding after such
repurchase is to be registered) and a statement that an election to exercise the
repurchase right is being made thereby, and, in the event that the Repurchase
Price shall be paid in shares of Common Stock, the name or names (with
addresses) in which the certificate or certificates for shares of Common Stock
shall be issued, and (ii) the Securities with respect to which the repurchase
right is being exercised. Such written notice shall be irrevocable, except that
the right of the Holder to convert the Securities with respect to which the
repurchase right is being exercised shall continue until the close of business
on the Repurchase Date.

                  (3) In the event a repurchase right shall be exercised in
accordance with the terms hereof, the Company shall pay or cause to be paid to
the Trustee the Repurchase Price in

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<PAGE>   108

cash or shares of Common Stock, as provided above, for payment to the Holder on
the Repurchase Date or, if shares of Common Stock are to be paid, as promptly
after the Repurchase Date as practicable, together with accrued and unpaid
interest to the Repurchase Date payable with respect to the Securities as to
which the repurchase right has been exercised; provided, however, that
installments of interest that mature on or prior to the Repurchase Date shall be
payable in cash to the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the relevant Regular
Record Date.

                  (4) If any Security (or portion thereof) surrendered for
repurchase shall not be so paid on the Repurchase Date, the principal amount of
such Security (or portion thereof, as the case may be) shall, until paid, bear
interest to the extent permitted by applicable law from the Repurchase Date at
the rate of 3.50% per annum, and each Security shall remain convertible into
Common Stock until the principal of such Security (or portion thereof, as the
case may be) shall have been paid or duly provided for.

                  (5) Any Security which is to be repurchased only in part shall
be surrendered to the Trustee (with, if the Company or the Trustee so requires,
due endorsement by, or a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and make available for delivery to the Holder of such
Security without service charge, a new Security or Securities, containing
identical terms and conditions, each in an authorized denomination in aggregate
principal amount equal to and in exchange for the unrepurchased portion of the
principal of the Security so surrendered.

                  (6) Any issuance of shares of Common Stock in respect of the
Repurchase Price shall be deemed to have been effected immediately prior to the
close of business on the Repurchase Date and the Person or Persons in whose name
or names any certificate or certificates for shares of Common Stock shall be
issuable upon such repurchase shall be deemed to have become on the Repurchase
Date the holder or holders of record of the shares represented thereby;
provided, however, that any surrender for repurchase on a date when the stock
transfer books of the Company shall be closed shall constitute the Person or
Persons in whose name or names the certificate or certificates for such shares
are to be issued as the record holder or holders thereof for all purposes at the
opening of business on the next succeeding day on which such stock transfer
books are open. No payment or adjustment shall be made for dividends or
distributions on any Common Stock issued upon repurchase of any Security
declared prior to the Repurchase Date.

                  (7) No fractions of shares shall be issued upon repurchase of
Securities. If more than one Security shall be repurchased from the same Holder
and the Repurchase Price shall be payable in shares of Common Stock, the number
of full shares which shall be issuable upon such repurchase shall be computed on
the basis of the aggregate principal amount of the Securities so repurchased.
Instead of any fractional share of Common Stock which would otherwise be
issuable on the repurchase of any Security or Securities, the Company will
deliver to the applicable Holder its check for the current market value of such
fractional share. The

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current market value of a fraction of a share is determined by multiplying the
current market price of a full share by the fraction, and rounding the result to
the nearest cent. For purposes of this Section, the current market price of a
share of Common Stock is the Closing Price Per Share of the Common Stock on the
Trading Day immediately preceding the Repurchase Date.

                  (8) Any issuance and delivery of certificates for shares of
Common Stock on repurchase of Securities shall be made without charge to the
Holder of Securities being repurchased for such certificates or for any tax or
duty in respect of the issuance or delivery of such certificates or the
securities represented thereby; provided, however, that the Company shall not be
required to pay any tax or duty which may be payable in respect of (i) income of
the Holder or (ii) any transfer involved in the issuance or delivery of
certificates for shares of Common Stock in a name other than that of the Holder
of the Securities being repurchased, and no such issuance or delivery shall be
made unless and until the Person requesting such issuance or delivery has paid
to the Company the amount of any such tax or duty or has established, to the
satisfaction of the Company, that such tax or duty has been paid.

                  (9) If shares of Common Stock to be delivered upon repurchase
of a Security are to be registered in a name other than that of the beneficial
owner of such Security, then such Holder must deliver to the Trustee a Surrender
Certificate, dated the date of surrender of such Restricted Security and signed
by such beneficial owner, as to compliance with the restrictions on transfer
applicable to such Restricted Security. Neither the Trustee nor any Registrar or
Transfer Agent or other agents shall be required to register in a name other
than that of the beneficial owner shares of Common Stock issued upon repurchase
of any such Restricted Security not so accompanied by a properly completed
Surrender Certificate.

                  (10) All Securities delivered for repurchase shall be
delivered to the Trustee to be canceled at the direction of the Trustee, which
shall dispose of the same as provided in Section 3.9.

SECTION 14.4      Certain Definitions.

                  For purposes of this Article XIV,

                  (1) the term "beneficial owner" shall be determined in
accordance with Rule 13d-3, as in effect on the date of the original execution
of this Indenture, promulgated by the Commission pursuant to the Exchange Act;

                  (2) a "Change in Control" shall be deemed to have occurred at
the time, after the original issuance of the Securities, of:

                  (i) the acquisition by any Person (including any syndicate or
group deemed to be a "person" under Section 13(d)(3) of the Exchange Act) of
beneficial ownership, directly or indirectly, through a purchase, merger or
other acquisition transaction or series of transactions, of shares of capital
stock of the Company entitling such person to exercise 50% or more of the total
voting power of all shares of capital stock of the Company entitled to vote
generally in the

                                      102
<PAGE>   110

elections of directors, other (A) than any such acquisition by the Company, any
subsidiary of the Company or any employee benefit plan of the Company or (b) any
such acquisition by Mr. Darwin Deason, the Deason International Trust or any
person controlled by Mr. Deason or the Deason International Trust, so long as
any such acquisition does not result, directly or indirectly, in a "going
private transaction" within the meaning of the Exchange Act; or

                  (ii) any consolidation of the Company with, or merger of the
Company into, any other Person, any merger of another Person into the Company,
or any conveyance, sale, transfer or lease of all or substantially all of the
assets of the Company to another Person (other than (a) any such transaction (x)
which does not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of capital stock of the Company and (y)
pursuant to which the holders of the Common Stock immediately prior to such
transaction have the entitlement to exercise, directly or indirectly, 50% or
more of the total voting power of all shares of capital stock entitled to vote
generally in the election of directors of the continuing or surviving
corporation immediately after such transaction and (b) any merger which is
effected solely to change the jurisdiction of Incorporation of the Company and
results in a reclassification, conversion or exchange of outstanding shares of
Common Stock into solely shares of common stock); provided, however, that a
Change in Control shall not be deemed to have occurred if (I) the Closing Sales
Price Per Share of the Class A Common Stock for any five Trading Days within the
period of 10 consecutive Trading Days ending immediately after the later of the
Change in Control or the public announcement of the Change in Control (in the
case of a Change in Control under clause (i) above) or the period of 10
consecutive Trading Days ending immediately before the Change in Control (in the
case of a Change in Control under clause (ii) above) shall equal or exceed 105%
of the Conversion Price of the Notes in effect on each such Trading Day or (II)
all of the consideration (excluding cash payments for fractional shares and cash
payments made pursuant to dissenters' appraisal rights) in a merger or
consolidation otherwise constituting a Change of Control under clause (i) and/or
clause (ii) above consists of shares of common stock traded on a national
securities exchange or quoted on the Nasdaq National Market (or will be so
traded or quoted immediately following such merger or consolidation) and as a
result of such merger or consolidation the notes become convertible into such
common stock. For purposes of this Section 14.4, "Beneficial Owner" shall be
determined in accordance with Rule 13(d)(3) promulgated by the Commission under
the Exchange Act, as in effect on the date of this Indenture.

                  (3) the term "Conversion Price" shall equal U.S.$1,000 divided
by the Conversion Rate (rounded to the nearest cent); and

                  (4) for purposes of Section 14.4(2)(i), the term "person"
shall include any syndicate or group which would be deemed to be a "person"
under Section 13(d)(3) of the Exchange Act, as in effect on the date of the
original execution of this Indenture.

                                      103
<PAGE>   111

SECTION 14.5      Consolidation, Merger, Etc.

                  In the case of any consolidation, conveyance, sale, transfer
or lease of all or substantially all of the assets of the Company to which
Section 12.11 applies, in which the Common Stock of the Company is changed or
exchanged as a result into the right to receive shares of stock and other
securities or property or assets (including cash) which includes shares of
Common Stock of the Company or common stock of another Person that are, or upon
issuance will be, traded on a United States national securities exchange or
approved for trading on an established automated over-the-counter trading market
in the United States and such shares constitute at the time such change or
exchange becomes effective in excess of 50% of the aggregate fair market value
of such shares of stock and other securities, property and assets (including
cash) (as determined by the Company, which determination shall be conclusive and
binding), then the Person formed by such consolidation or resulting from such
merger or combination or which acquires the properties or assets (including
cash) of the Company, as the case may be, shall execute and deliver to the
Trustee a supplemental indenture (which shall comply with the Trust Indenture
Act as in force at the date of execution of such supplemental indenture)
modifying the provisions of this Indenture relating to the right of Holders to
cause the Company to repurchase the Securities following a Change in Control,
including without limitation the applicable provisions of this Article XIV and
the definitions of the Common Stock and Change in Control, as appropriate, and
such other related definitions set forth herein as determined in good faith by
the Company (which determination shall be conclusive and binding), to make such
provisions apply in the event of a subsequent Change of Control to the common
stock and the issuer thereof if different from the Company and Common Stock of
the Company (in lieu of the Company and the Common Stock of the Company).

                                   ARTICLE XV
                      HOLDERS LISTS AND REPORTS BY TRUSTEE
                            AND COMPANY; NON-RECOURSE

SECTION 15.1      Company to Furnish Trustee Names and Addresses of Holders.

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

                  (1) semi-annually, not more than 15 days after the Regular
Record Date, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders of Securities as of such Regular Record Date,
and

                  (2) at such other times as the Trustee may reasonably request
in writing, within 30 days after the receipt by the Company of any such request,
a list of similar form and content as of a date not more than 15 days prior to
the time such list is furnished; provided, however, that no such list need be
furnished so long as the Trustee is acting as Security Registrar.

                                      104
<PAGE>   112

SECTION 15.2      Preservation of Information.

                  (1) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the most
recent list furnished to the Trustee as provided in Section 15.1 and the names
and addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list, if any, furnished to it as provided
in Section 15.1 upon receipt of a new list so furnished.

                  (2) After this Indenture has been qualified under the Trust
Indenture Act, the rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and the
corresponding rights, and duties of the Trustee, shall be as provided by the
Trust Indenture Act.

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

SECTION 15.3      No Recourse Against Others.

                  An incorporator or any past, present or future director,
officer, employee or stockholder, as such, of the Company or any subsidiary
shall not have any liability for any obligations of the Company under the
Securities or this Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Holder shall waive and release all such liability. Such waiver and release shall
be part of the consideration for the issue of the Securities.

SECTION 15.4      Reports by Trustee.

                  (1) After this Indenture has been qualified under the Trust
Indenture Act, the Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.

                  (2) After this Indenture has been qualified under the Trust
Indenture Act a copy of each such report shall, at the time of such transmission
to Holders, be filed by the Trustee with each stock exchange upon which the
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when the Securities are listed on any stock exchange.

SECTION 15.5      Reports by Company.

                  After this Indenture has been qualified under the Trust
Indenture Act, the Company shall file with the Trustee and the Commission, and
transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required

                                      105
<PAGE>   113

pursuant to the Trust Indenture Act at the times and in the manner provided
pursuant to such Act; provided that any such information, documents or reports
required to be filed with the Commission pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 shall be filed with the Trustee within 15 days
after the same is so required to be filed with the Commission.

                                  ARTICLE XVI
                    IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
                             OFFICERS AND DIRECTORS

SECTION 16.1      Indenture and Securities Solely Corporate Obligations.

                  No recourse for the payment of the principal of or premium, if
any, or interest on any Security and no recourse under or upon any obligation,
covenant or agreement of the Company in this Indenture or in any supplemental
indenture or in any Security, or because of the creation of any indebtedness
represented thereby, shall be had against any incorporator, stockholder,
employee, agent, officer, or director or subsidiary, as such, past, present or
future, of the Company or of any successor corporation, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly understood that all such liability is
hereby waived and released as a condition of, and as a consideration for, the
execution of this Indenture and the issue of the Securities.

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

                                      106
<PAGE>   114

         IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.

                                     AFFILIATED COMPUTER SERVICES, INC.

                                     By: /s/ MARK KING
                                         ----------------------------
                                         Name:  Mark King
                                         Title: Executive Vice-President and
                                                Chief Financial Officer

Attest:

/s/ WILLIAM L. DECKELMAN, JR.
-------------------------------
Name:   William L. Deckelman, Jr.
Title:  Executive Vice President,
        General Counsel and Corporate Secretary

                                     U.S. TRUST COMPANY OF TEXAS, N.A.,
                                     as Trustee

                                     By: /s/ BILL BARBER
                                         ----------------------------
                                         Name: Bill Barber
                                         Title: Vice President

Attest:

/s/ PEG MAKOWSKI
-------------------------------
Name:  Peg Makowski
Title: Assistant Vice President

                                      107
<PAGE>   115

                                                   ANNEX A -- Form of Restricted
                                                          Securities Certificate

                        RESTRICTED SECURITIES CERTIFICATE
             (For transfers pursuant to Section 3.5(2)(ii) and (iii)
                                of the Indenture)

U.S. Trust Company of Texas, N.A.
2001 Ross Avenue
Suite 2700
Dallas, TX 75201-2936

                  Re: 3.50% Convertible Subordinated Notes due

                  February 15, 2006 of Affiliated Computer Services, Inc.
                  (the "Securities")

                  Reference is made to the Indenture, dated as of February 21,
2001 (the "Indenture"), from Affiliated Computer Services, Inc. (the "Company")
to U.S. Trust Company of Texas, N.A., as Trustee. Terms used herein and defined
in the Indenture or Rule 144 under the U.S. Securities Act of 1933 (the
"Securities Act") are used herein as so defined.

                  This certificate relates to U.S. $________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):

                  CUSIP No.
                            -------------------------

                  CERTIFICATE No(s).
                                    -----------------

                  The person in whose name this certificate is executed below
(the "Undersigned") hereby certifies that either (i) it is the sole beneficial
owner of the Specified Securities or (ii) it is acting on behalf of all the
beneficial owners of the Specified Securities and is duly authorized by them to
do so. Such beneficial owner or owners are referred to herein collectively as
the "Owner". If the Specified Securities are represented by a Global Security,
they are held through the Depositary or an Agent Member in the name of the
Undersigned, as or on behalf of the Owner. If the Specified Securities are not
represented by a Global Security, they are registered in the name of the
Undersigned, as or on behalf of the Owner.

                  The Owner has requested that the Specified Securities be
transferred to a person (the "Transferee") who will take delivery in the form of
a Restricted Security. In connection with such transfer, the Owner hereby
certifies that, unless such transfer is being effected pursuant to an effective
registration statement under the Securities Act, it is being effected in
accordance with Rule 144A or Rule 144 under the Securities Act and all
applicable securities laws of the

                                      108
<PAGE>   116

states of the United States and other jurisdictions. Accordingly, the Owner
hereby further certifies as:

                  (1) Rule 144A Transfers. If the transfer is being effected in
accordance with Rule 144A:

                  (A) the Specified Securities are being transferred to a person
that the Owner and any person acting on its behalf reasonably believe is a
"qualified institutional buyer" within the meaning of Rule 144A, acquiring for
its own account or for the account of a qualified institutional buyer; and

                  (B) the Owner and any person acting on its behalf have taken
reasonable steps to ensure that the Transferee is aware that the Owner may be
relying on Rule 144A in connection with the transfer; and

                  (2) Rule 144 Transfers. If the transfer is being effected
pursuant to Rule 144:

                  (A) the transfer is occurring after a holding period of at
least one year (computed in accordance with paragraph (d) of Rule 144) has
elapsed since the date the Specified Securities were acquired from the Company
or from an affiliate (as such term is defined in Rule 144) of the Company,
whichever is later, and is being effected in accordance with the applicable
amount, manner of sale and notice requirements of paragraphs (e), (f) and (h) of
Rule 144; or

                  (B) the transfer is occurring after a period of at least two
years has elapsed since the date the Specified Securities were acquired from the
Company or from an affiliate (as such term is defined in Rule 144) of the
Company, whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Company.

                  (C) INSTITUTIONAL ACCREDITED INVESTORS. If the transfer is to
an institutional investor that is an accredited investor within the meaning of
Rule 501(A)(1), (2), (3) or (7) of Regulation D under the Securities Act, a
signed letter containing certain representations and agreements relating to the
restrictions on transfer of the Securities and, if such transfer is for less
than an aggregate principal amount of $250,000, an opinion of counsel acceptable
to the Company is requested by the Company, that the transfer is exempt from
registration, must be supplied to the Trustee prior to such transfer.

                                      109
<PAGE>   117

                  This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and the Initial Purchasers.

Dated:
                  -----------------------------------
                  (Print the name of the Undersigned, as such term is defined in
                  the second paragraph of this certificate.)

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

                  (If the Undersigned is a corporation, partnership or
                  fiduciary, the title of the person signing on behalf of the
                  Undersigned must be stated.)

                                      110
<PAGE>   118

                                                 ANNEX B -- Form of Unrestricted
                                                         Securities Certificate

                       UNRESTRICTED SECURITIES CERTIFICATE

    (For removal of Restricted Securities Legend pursuant to Section 3.5(3))

U.S. Trust Company of Texas, N.A.
2001 Ross Avenue
Suite 2700
Dallas, TX 75201-2936

                  Re: 3.50% Convertible Subordinated Notes due

                  February 15, 2006 of Affiliated Computer Services, Inc.
                  (the "Securities")

                  Reference is made to the Indenture, dated as of February 21,
2001 (the "Indenture"), from Affiliated Computer Services, Inc. (the "Company")
to U.S. Trust Company of Texas, N.A., as Trustee. Terms used herein and defined
in the Indenture or Rule 144 under the U.S. Securities Act of 1933 (the
"Securities Act") are used herein as so defined.

                  This certificate relates to U.S.$_______________ principal
amount of Securities, which are evidenced by the following certificate(s) (the
"Specified Securities"):

                  CUSIP No.
                           --------------------------

                  CERTIFICATE No(s).
                                    -----------------

                  The person in whose name this certificate is executed below
(the "Undersigned") hereby certifies that either (i) it is the sole beneficial
owner of the Specified Securities or (ii) it is acting on behalf of all the
beneficial owners of the Specified Securities and is duly authorized by them to
do so. Such beneficial owner or owners are referred to herein collectively as
the "Owner". If the Specified Securities are represented by a Global Security,
they are held through the Depositary or an Agent Member in the name of the
Undersigned, as or on behalf of the Owner. If the Specified Securities are not
represented by a Global Security, they are registered in the name of the
Undersigned, as or on behalf of the Owner.

                  The Owner has requested that the Specified Securities be
exchanged for Securities bearing no Restricted Securities Legend pursuant to
Section 3.5(3) of the Indenture. In connection with such exchange, the Owner
hereby certifies that the exchange is occurring after a period of at least two
years has elapsed since the date the Specified Securities were acquired from the
Company or from an "affiliate" (as such term is defined in Rule 144) of the
Company, whichever is later, and the Owner is not, and during the preceding
three months has not been, an

                                      111
<PAGE>   119

affiliate of the Company. The Owner also acknowledges that any future transfers
of the Specified Securities must comply with all applicable securities laws of
the states of the United States and other jurisdictions.

                  This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and the Initial Purchasers.

Dated:
      ----------------------

         (Print the name of the Undersigned, as such term is defined in the
         second paragraph of this certificate.)

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

         (If the Undersigned is a corporation, partnership or fiduciary, the
         title of the person signing on behalf of the Undersigned must be
         stated.)

                                      112
<PAGE>   120

                                                               ANNEX C-- Form of
                                                           Surrender Certificate

                  In connection with the certification contemplated by Section
12.2 or 14.3(9) relating to compliance with certain restrictions relating to
transfers of Restricted Securities, such certification shall be provided
substantially in the form of the following certificate, with only such changes
thereto as shall be approved by the Company and Goldman, Sachs & Co.:

                                   CERTIFICATE

                        AFFILIATED COMPUTER SYSTEMS, INC.

                  3.50% CONVERTIBLE NOTES DUE FEBRUARY 15, 2006

                  This is to certify that as of the date hereof with respect to
U.S. $______ principal amount of the above-captioned securities surrendered on
the date hereof (the "Surrendered Securities") for registration of transfer, or
for conversion or repurchase where the securities issuable upon such conversion
or repurchase are to be registered in a name other than that of the undersigned
Holder (each such transaction being a "transfer"), the undersigned Holder (as
defined in the Indenture) certifies that the transfer of Surrendered Securities
associated with such transfer complies with the restrictive legend set forth on
the face of the Surrendered Securities for the reason checked below:

                  The transfer of the Surrendered Securities complies with Rule
----------        144 under the United States Securities Act of 1933, as amended
                  (the "Securities Act"); or

                  The transfer of the Surrendered Securities complies with Rule
----------        144A under the Securities Act; or

                  The transfer of the Surrendered Securities complies with Rule
----------        904 under the Securities Act; or

                  The transfer of the Surrendered Securities has been made to an
----------        institution that is an "accredited investor" within the
                  meaning of Rule 501(a)(1), (2), (3) or (7) under the
                  Securities Act in a transaction exempt from the registration
                  requirements of the Securities Act.

                                [Name of Holder]

                                ----------------------

Dated:
       ------------------
                  *To be dated the date of surrender

                                      113

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