MORTON INTERNATIONAL INC /IN/, S-3, 1998-05-01

MORTON INTERNATIONAL INC /IN/
S-3, 1998-05-01
MISCELLANEOUS CHEMICAL PRODUCTS

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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 1, 1998

REGISTRATION NO. 333-

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________________

FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
____________________

MORTON INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)

INDIANA 36-4140798
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification Number)
organization)

100 N. RIVERSIDE PLAZA
CHICAGO, ILLINOIS 60606-1596
(312) 807-2000
(Address, including zip code, and telephone number, including
area code, of Registrant's principal executive offices)

RAYMOND P. BUSCHMANN
VICE PRESIDENT FOR LEGAL AFFAIRS, GENERAL COUNSEL AND SECRETARY
100 NORTH RIVERSIDE PLAZA
CHICAGO, ILLINOIS 60606-1596
(312) 807-2000
(Name, address, including zip code, and telephone number, including
area code, of agent for service)

Copies to:

FREDERICK L. HARTMANN
SCHIFF HARDIN & WAITE
7300 SEARS TOWER
CHICAGO, ILLINOIS 60606
(312) 258-5656

EDWARD BEST
MAYER, BROWN & PLATT
190 SOUTH LASALLE STREET
CHICAGO, ILLINOIS 60606
(312) 782-0600
__________________

<PAGE> 2

Approximate date of commencement of proposed sale to the public:
From time to time after the Registration Statement becomes effective.
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans, please
check the following box: /__/
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, as amended, other than securities offered
only in connection with dividend or interest reinvestment plans, check
the following box: /X/
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, check the
following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same
offering. /__/
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. /__/
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box. /__/
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE

TITLE OF EACH CLASS PROPOSED MAXIMUM
OF PROPOSED MAXIMUM AGGREGATE AMOUNT OF
SECURITIES TO BE AMOUNT OFFERING PRICE OFFERING REGISTRATION
REGISTERED TO BE REGISTERED PER UNIT (1) PRICE (2) FEE
<S> <C> <C> <C>
Debt Securities $1,000,000,000 100% $1,000,000,000 $295,000
</TABLE>

(1) To be determined from time to time by the Registrant in
connection with the issuance by the Registrant of the Debt
Securities registered hereunder.

(2) Estimated in accordance with Rule 457 under the Securities Act of
1933, as amended (the "Securities Act"), solely for the purpose
of computing the registration fee.

_______________________

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH
DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL
THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY
STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME
EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OR
UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE
AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.

<PAGE> 3

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT
BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE
REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR
SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR
QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.

PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION,
DATED May 1, 1998

$1,000,000,000

MORTON INTERNATIONAL, INC. [LOGO]
DEBT SECURITIES
________________

Morton International, Inc., an Indiana corporation (the
"Company"), may from time to time offer pursuant to this Prospectus
unsecured debt securities ("Debt Securities"), with an aggregate
public offering price of up to $1,000,000,000 (or its equivalent in
one or more foreign currencies, composite currencies or currency
units) on terms to be determined at the time or times of offering.
The Debt Securities may be offered, separately or together, in
separate classes or series, in amounts, at prices and on terms to be
set forth in one or more supplements to this Prospectus (each, a
"Prospectus Supplement").

Certain specific terms of the offering and sale of the Debt
Securities in respect of which this Prospectus is being delivered will
be set forth in the applicable Prospectus Supplement and will include
the specific series title, aggregate principal amount, currency, form
(which may be registered or bearer or certificated or global),
authorized denominations, maturity, rate (or manner of calculation
thereof) and time of payment of interest (if any), terms (if any) for
redemption at the option of the Company or repayment at the option of
the holder thereof, and terms (if any) for sinking fund payments.

Each Prospectus Supplement will also contain information, when
applicable, about certain United States Federal income tax
considerations relating to the Debt Securities covered by that
Prospectus Supplement.

The Debt Securities may be offered directly, through agents
designated from time to time by the Company, or to or through
underwriters or dealers. If any agents or underwriters are involved
in the sale of any of the Debt Securities, their names and any
applicable purchase price, fee, commission or discount arrangement
between or among them and the Company will be set forth in or will be
calculable from the information set forth in the applicable Prospectus
Supplement. No Debt Securities may be sold without delivery of the

<PAGE> 4

applicable Prospectus Supplement describing the method and terms of
the offering of those Debt Securities. See "Plan of Distribution" for
a description of possible indemnification arrangements with
underwriters, dealers and agents.

__________________

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION,
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

___________________

This Prospectus may not be used to consummate sales of the Debt
Securities unless accompanied by a Prospectus Supplement.

____________________

The date of this Prospectus is May 1, 1998

<PAGE> 5

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE
CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS OR AN
APPLICABLE PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER, DEALER OR AGENT. THIS
PROSPECTUS AND ANY APPLICABLE PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE
AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES
OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION.
NEITHER THE DELIVERY OF THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT
NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE ANY
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE
COMPANY SINCE THE DATE HEREOF OR THEREOF.

AVAILABLE INFORMATION

The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
in accordance therewith, files reports, proxy statements and other
information with the Securities and Exchange Commission (the
"Commission"). Reports, proxy statements and other information filed
by the Company can be inspected and copied at the public reference
facilities maintained by the Commission at Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the Commission's
Regional Offices at Seven World Trade Center, 13th Floor, New York,
New York 10048 and 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661. Copies of such material can be obtained from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates, or through the
Commission's worldwide web site at http://www.sec.gov. Such reports,
proxy statements and other information concerning the Company may also
be inspected and copied at the offices of the New York Stock Exchange,
Inc., 20 Broad Street, New York, New York 10005.

The Company has filed with the Commission a Registration
Statement on Form S-3 (together with all amendments and exhibits, the
"Registration Statement") under the Securities Act of 1933, as amended
(the "Securities Act"), relating to the Debt Securities. This
Prospectus does not contain all of the information set forth in the
Registration Statement as permitted by the rules and regulations of
the Commission. For further information with respect to the Company
and the Debt Securities, reference is hereby made to such Registration
Statement. The Registration Statement may be inspected without charge
by anyone at the office of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, and copies of all or any part thereof may be
obtained from the Commission upon payment of the prescribed fees, or
through the Commission's worldwide web site. Statements contained in
this Prospectus as to the contents of any contract or other document
referred to are not necessarily complete, and in each instance
reference is made to the copy of such document filed as an exhibit to

<PAGE> 6

the Registration Statement or otherwise filed with the Commission.
Each such statement is qualified in all respects by such reference.

DOCUMENTS INCORPORATED BY REFERENCE

The following documents filed with the Commission (File No. 1-
12825) are incorporated herein by reference:

(i) the Company's Annual Report on Form 10-K for the year ended
June 30, 1997; and

(ii) the Company's Quarterly Reports on Form 10-Q for the
quarters ended September 30, 1997 and December 31, 1997.

All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act after the date of this Prospectus and
prior to the termination of the offering of the Debt Securities shall
be deemed to be incorporated in this Prospectus by reference and to be
a part hereof from the date of filing of such documents. Any
statement contained herein or in a document incorporated or deemed to
be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a
statement contained herein (or in the applicable Prospectus
Supplement) or in any other subsequently filed document which also is
or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.

The Company will provide, without charge to any person to whom a
copy of this Prospectus is delivered, upon the written or oral request
of such person, a copy of any document incorporated by reference
herein other than exhibits to such document unless such exhibits are
specifically incorporated by reference in such document. Requests
should be directed to Raymond P. Buschmann, Vice President for Legal
Affairs, General Counsel and Secretary, Morton International, Inc.,
100 N. Riverside Plaza, Chicago, Illinois 60606-1596, telephone (312)
807-2000.

<PAGE> 7

THE COMPANY

Morton International, Inc. (the "Company") operates in two
business segments: Specialty Chemicals and Salt, manufacturing and
marketing a wide range of products for industrial and consumer use in
the United States and internationally. The Specialty Chemicals
segment manufactures a wide variety of high technology and specialized
chemical products for a multitude of customer applications. The three
Specialty Chemical groups are: (i) Adhesives and Chemical
Specialties, (ii) Coatings and (iii) Electronic Materials. The
Company's Salt segment produces and sells salt, principally in the
U.S., Canada and Europe, under (respectively) the MORTON, WINDSOR and
LA BALEINE trademarks, for human and animal consumption, water
conditioning and highway ice control, as well as for industrial and
chemical uses.

Effective April 30, 1997, the Company's predecessor, which was
then named "Morton International, Inc." ("Old Morton"), contributed
its Salt and Specialty Chemical businesses to the Company, which was a
newly created subsidiary. All the outstanding common stock of the
Company was then spun off on a share-for-share basis to the
shareholders of Old Morton. Immediately thereafter, the Company's
corporate name was changed to "Morton International, Inc.", and Old
Morton's Automotive Safety Products business (along with $750 million
of indebtedness used to finance a cash contribution to the Company)
was merged with the businesses of Autoliv AB, a Swedish corporation,
through the formation of a new Delaware holding corporation, Autoliv,
Inc. ("New Autoliv"). As a result of the merger, Old Morton
shareholders exchanged their Old Morton shares for common stock of New
Autoliv at an exchange ratio of approximately one New Autoliv share
for every three Old Morton shares. As of May 1, 1997, the Company and
New Autoliv operated as separate, independent corporations.

The Company's principal executive offices are located at 100
North Riverside Plaza, Chicago, Illinois 60606, and its telephone
number is (312) 807-2000.

RATIO OF EARNINGS TO FIXED CHARGES <1> <2>

Six Months
Ended December 31, Fiscal Year Ended June 30,
------------------ -------------------------------------------

1998 1997 1997 1996 1995 1994 1993
---- ---- ---- ---- ---- ---- ----

11.0 9.0 9.9 8.8 7.1 6.0 3.7

<PAGE> 8

__________________

<1> The Ratio of Earnings to Fixed Charges reflects the continuing
operations of the Company's specialty chemicals, salt and
corporate operations which were spun off to shareholders of Old
Morton in a tax-free distribution in the United States effective
April 30, 1997.

<2> For purposes of computing this ratio, "earnings" consist of
income from continuing operations before income taxes and fixed
charges (excluding capitalized interest). "Fixed charges"
consist of interest on all indebtedness, amortization of debt
discount and expense plus one third of rental expense (which is
deemed representative of the interest factor).

USE OF PROCEEDS

Except as may be otherwise described in the applicable Prospectus
Supplement, the Company intends to use the net proceeds from the sale
of the Debt Securities for general corporate purposes, which may
include (without limitation) financing and re-financing of
acquisitions, purchases of Company stock, repurchases of outstanding
long-term debt, capital expenditures, investments in subsidiaries,
working capital and repayment of borrowings under credit facilities.

DESCRIPTION OF THE DEBT SECURITIES

The aggregate offering price of Debt Securities offered by the
Company under this Prospectus and one or more Prospectus Supplements
will not exceed $1,000,000,000 (or its equivalent in one or more
foreign currencies, composite currencies or currency units).

The following description of the Debt Securities sets forth
certain general provisions of the Debt Securities to which any
Prospectus Supplement may relate. The Debt Securities are to be
issued under an Indenture, dated as of ________ ___, 1998, (the
"Indenture"), between the Company and The First National Bank of
Chicago, as Trustee (the "Trustee"), a copy of which is incorporated
by reference as an exhibit to the Registration Statement of which this
Prospectus is a part. The material terms of the Debt Securities
offered by any Prospectus Supplement (the "Offered Debt Securities")
and the extent, if any, to which such general provisions are not
applicable to the Offered Debt Securities, will be described in the
applicable Prospectus Supplement relating to such Offered Debt
Securities.

The following summaries of certain provisions of the Indenture
and the Debt Securities do not purport to be complete and are subject
to, and are qualified in their entirety by reference to, all of the
provisions of the Indenture, including the definitions therein of
certain terms, and such Debt Securities. Wherever particular
articles, sections or defined terms of the Indenture are referred to,
it is intended that such articles, sections or defined terms shall be

<PAGE> 9

incorporated herein by reference, and the statement in connection with
which such reference is made is qualified in its entirety by such
reference. Unless otherwise indicated, section references in the
following summary of the Indenture are to sections of the Indenture.

GENERAL

The Indenture does not limit the amount of debt, either secured
or unsecured, which may be issued by the Company under the Indenture
or otherwise. The Debt Securities may be issued in one or more series
with the same or various maturities and may be sold at par, a premium
or an original issue discount. (Section 3.01) Debt Securities sold
at an original issue discount may bear no interest or interest at a
rate which is below market rates.

The Prospectus Supplement relating to the particular Debt
Securities offered thereby will describe the material terms of the
Offered Debt Securities, such as: (i) the title of the Offered Debt
Securities; (ii) any limit on the aggregate principal amount of the
Offered Debt Securities; (iii) the price (which may be expressed as a
percentage of the aggregate principal amount thereof) at which the
Offered Debt Securities will be issued; (iv) the date or dates on
which the Offered Debt Securities mature and any provisions for the
extension of any maturity date or dates; (v) the rate or rates (which
may be fixed or variable) per annum at which the Offered Debt
Securities will bear interest, if any, or the method by which such
rate or rates will be determined including, if applicable, any
remarketing option or similar methods; (vi) the date from which such
interest will accrue, the dates on which such interest, if any, will
be payable, the date on which payment of such interest will commence
and any Regular Record Dates applicable to the dates on which interest
will be so payable; (vii) the place or places where the principal of
(and premium, if any) and interest, if any, on the series will be
payable and each office or agency where the Offered Debt Securities
may be presented for transfer or exchange; (viii) the dates on which
and the price or prices at which the Offered Debt Securities will,
pursuant to any mandatory sinking fund provisions, or may, pursuant to
any optional sinking fund provisions, be redeemed by the Company, and
the other material terms and provisions of such sinking fund; (ix) the
currency in which payment of the principal of, premium, if any, and
interest on, the Offered Debt Securities will be payable, if other
than the currency of the United States; (x) the period or periods
within which, and the terms and conditions upon which, an election may
be made by the Company or a holder, as the case may be, for payment in
a particular currency other than the currency in which the series is
denominated; (xi) whether such Offered Debt Securities are to be
issued in the form of one or more permanent Global Debt Securities
and, if so, the identity of the Depository for such Global Debt
Security or Securities; (xii) the date after which and the price or
prices at which and the currency in which the Offered Debt Securities
may, pursuant to any optional redemption provisions, be redeemed at
the option of the Company or of the Holder thereof and the other terms
and provisions of such optional redemption; (xiii) if other than

<PAGE> 10

denominations of $1,000 and any integral multiple thereof, the
denominations in which the Offered Debt Securities will be issuable;
(xiv) information with respect to certain book-entry procedures, if
applicable; (xv) any deletions from, modifications of or additions to
the Events of Default or covenants with respect to the Offered Debt
Securities; and (xvi) any other material terms of the Offered Debt
Securities (which terms shall not be inconsistent with the provisions
of the Indenture).

Unless otherwise indicated in the applicable Prospectus
Supplement, principal of (and premium, if any) and interest, if any,
on the Offered Debt Securities will be payable, and transfers of the
Offered Debt Securities will be registrable, at the Principal Office
of the Trustee, provided that at the option of the Company (i) payment
of interest may be made by check mailed to the address of the person
entitled thereto as it appears in the Debt Security Register; and (ii)
payment of the principal of, premium, if any, and interest on Debt
Securities may be made by wire transfer of immediately available funds
provided that the applicable Paying Agent has received from the Holder
to whom such payment is due complete and appropriate wire transfer
instructions in sufficient time to make such payment by wire transfer.
(Sections 3.01 and 3.03)

Unless otherwise indicated in the applicable Prospectus
Supplement, the Offered Debt Securities will be issued only in fully
registered form without coupons in denominations of U.S. $1,000 or
any integral multiple thereof, or the equivalent thereof in Foreign
Currency. (Section 3.02) No service charge will be made for any
registration of transfer or exchange of Offered Debt Securities, but
the Company may require payment of a sum sufficient to cover any tax
or other governmental charge payable in connection therewith.
(Section 3.06)

Unless otherwise indicated in the applicable Prospectus
Supplement, if the principal of, premium, if any, and interest on any
Debt Security is payable in a Foreign Currency and such Foreign
Currency is not available for payment due to the imposition of
exchange controls or other circumstances beyond the Company's control,
the Company may satisfy its obligations under the Indenture to Holders
of such Debt Securities by making such payment in Dollars on the basis
of the Market Exchange Rate for such Foreign Currency on the latest
date for which such Market Exchange Rate may be established by the
Currency Determination Agent on or before the date on which the
applicable payment is due. Any payment made in Dollars, due to the
above, where the required payment is in a Foreign Currency will not
constitute a default under the Indenture. (Section 3.11).

The Company shall not be required to (i) issue, register the
transfer of, or exchange Debt Securities of any series during the
period from 15 days prior to the mailing of notice of redemption of
Debt Securities of that series to the date of such mailing or (ii)
register the transfer of or exchange any Debt Security so selected for

<PAGE> 11

redemption, except the unredeemed portion of any Debt Security being
redeemed in part. (Section 3.06)

Some of the Debt Securities may be issued under the Indenture as
Original Issue Discount Securities to be sold at a substantial
discount below their principal amount. Certain United States Federal
income tax considerations applicable to such Original Issue Discount
Securities (if any) will be described in the Prospectus Supplement
relating thereto.

GLOBAL DEBT SECURITIES

The Debt Securities of a series may be issued in whole or in part
in the form of one or more Global Debt Securities that will be
deposited with, or on behalf of, a Depository identified in the
applicable Prospectus Supplement.

The Company anticipates that the following provisions will apply
to all Depository arrangements. The specific terms of a depository
arrangement that varies from that described below with respect to a
series of Debt Securities will be described in the applicable
Prospectus Supplement.

Upon the issuance of a Global Debt Security, the Depository for
such Global Debt Security or its nominee will credit, on its book-
entry registration and transfer system, the respective principal
amounts of the Debt Securities represented by such Global Debt
Security. Such accounts shall be designated by the underwriters or
agents with respect to such Debt Securities or by the Company if such
Debt Securities are offered and sold directly by the Company.
Ownership of beneficial interests in a Global Debt Security will be
limited to persons that may hold interests through participants in the
Depository. Ownership of beneficial interests in such Global Debt
Security will be shown on, and the transfer of that ownership will be
effected only through, records maintained by the Depository or its
nominee (with respect to interests of participants) for such Global
Debt Security and on the records of participants (with respect to
interests of persons other than participants). The laws of some
states require that certain purchasers of securities take physical
delivery of such securities in definitive form. Such limits and such
laws may impair the ability to transfer beneficial interests in a
Global Debt Security.

So long as the Depository for a Global Debt Security, or its
nominee, is the registered owner of such Global Debt Security, such
Depository or such nominee, as the case may be, will be considered the
sole owner or Holder of the Debt Securities represented by such Global
Debt Security for all purposes under the Indenture governing such Debt
Securities. Except as provided below, owners of beneficial interests
in a Global Debt Security will not be entitled to have Debt Securities
of the series represented by such Global Debt Security registered in
their names, will not receive or be entitled to receive physical
delivery of Debt Securities of such series in definitive form and will

<PAGE> 12

not be considered the owners or holders thereof under the Indenture
governing Debt Securities.

Principal of, premium, if any, and interest payments on Debt
Securities registered in the name of a Depository or its nominee will
be made to the Depository or its nominee, as the case may be, as the
registered owner of the Global Debt Security representing such Debt
Securities. Neither the Company, the Trustee for such Debt
Securities, any Paying Agent nor the Security Registrar for such Debt
Securities will have any responsibility or liability for any aspect of
the records relating to or payments made on account of beneficial
ownership interests of the Global Debt Security for such Debt
Securities or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.

The Company expects that the Depository for a series of Debt
Securities or its nominee, upon receipt of any payment of principal
of, premium, if any, or interest thereon, will credit immediately
participants' accounts with payments in amounts proportionate to their
respective beneficial interest in the principal amount of the Global
Debt Security for such Debt Securities as shown on the records of such
Depository or its nominee. The Company also expects that payments by
participants to owners of beneficial interests in such Global Debt
Security held through such participants will be governed by standing
instructions and customary practices, as is now the case with
securities held for the accounts of customers registered in "street
name," and will be the responsibility of such participants.

If a Depository for a series of Debt Securities is at any time
unwilling or unable to continue as Depository and a successor
Depository is not appointed by the Company within 90 days, the Company
will issue Debt Securities of such series in definitive form in
exchange for the Global Debt Security representing such series of Debt
Securities. Further, if the Company so specifies with respect to the
Debt Securities of a series, an owner of a beneficial interest in a
Global Debt Security representing Debt Securities of such series may,
on terms acceptable to the Company and the Depository for such Global
Debt Security, receive Debt Securities of such series in definitive
form. In any such instance, an owner of a beneficial interest in a
Global Debt Security will be entitled to physical delivery in
definitive form of Debt Securities of the series represented by such
Global Debt Security equal in principal amount to such beneficial
interest and to have such Debt Securities registered in its name.
Debt Securities of such series so issued in definitive form will be
issued in denominations, unless otherwise specified by the Company, of
U.S. $1,000 and integral multiples thereof.

<PAGE> 13

CERTAIN COVENANTS APPLICABLE TO DEBT SECURITIES

CERTAIN DEFINITIONS

The following terms are defined substantially as follows in
Section 1.01 of the Indenture and are used herein as so defined.

The term "Capitalized Rent" means the total net amount of rent
payable for the remaining term as of the date of determination thereof
under a lease of Principal Property by the Company or any of its
Restricted Subsidiaries, discounted from the respective due dates
thereof to such date of determination at the rate of 10% per annum
compounded annually. The total net amount of rent payable under any
such lease for any period shall be the total amount of the rent
payable by the lessee with respect to such period but shall not
include amounts required to be paid on account of maintenance and
repairs, insurance, taxes, assessments, water rates, sewer rents and
similar charges and contingent rents such as those based on sales.
The remaining term under any lease shall be calculated without giving
effect to any unexercised option of the lessee for the renewal or
extension of any term.

The term "Consolidated Net Tangible Assets" means the total of
all the assets appearing on the consolidated balance sheet of the
Company and its Restricted Subsidiaries, less the following: (1)
current liabilities, including liabilities for indebtedness maturing
more than 12 months from the date of the original creation thereof but
maturing within 12 months from the date of determination but excluding
any current liabilities constituting Funded Debt by reason of being
renewable or extendable and current deferred income taxes; (2)
reserves for depreciation and other asset valuation reserves; (3)
intangible assets, including, but without limitation, such items as
goodwill, trademarks, trade names, patents and unamortized debt
discount and expense carried as an asset on said balance sheet; (4)
appropriate adjustments on account of minority interests of other
Persons holding stock in any Restricted Subsidiary of the Company; and
(5) the value of assets of or investments in Unrestricted
Subsidiaries.

Consolidated Net Tangible Assets shall be determined in
accordance with generally accepted accounting principles and may be
determined by the Company as of a date not more than 60 days prior to
the happening of the event for which such determination is being made.

<PAGE> 14

than a current liability; provided, however, that Funded Debt shall
not include any of the foregoing to the extent that such indebtedness
or obligations are not required by generally accepted accounting
principles to be shown on the balance sheet of the Company.

The term "Principal Property" means any manufacturing plant,
warehouse, office building or parcel of real property (including
fixtures but excluding leases and other contract rights which might
otherwise be deemed real property) owned by the Company or any
Restricted Subsidiary, whether owned on the date of the Indenture or
thereafter, provided each such plant, warehouse, office building or
parcel of real property has a gross book value (without deduction for
any depreciation reserves) at the date as of which the determination
is being made of in excess of two percent of the Consolidated Net
Tangible Assets, other than any such plant, warehouse, office building
or parcel of real property or portion thereof which, in the opinion of
the Board of Directors of the Company (evidenced by a certified Board
Resolution delivered to the Trustee), is not of material importance to
the business conducted by the Company and its Restricted Subsidiaries
taken as a whole, or any such plant, warehouse, office building or
parcel of real property or portion thereof designated by the Board of
Directors (evidenced by a Board Resolution) as being held primarily
for development and/or sale.

The term "Restricted Subsidiary" means any Subsidiary other than
an Unrestricted Subsidiary.

The term "Security Interest" means any mortgage, pledge, lien,
encumbrance, conditional sale, title retention agreement or other
security interest which secures payment or performance of an
obligation.

The term "Secured Debt" means indebtedness for borrowed money and
any Funded Debt which is secured by a Security Interest in (a) any
Principal Property or (b) any shares of capital stock or indebtedness
of any Restricted Subsidiary which owns a Principal Property.

The term "Subsidiary" as to any Person, means (i) any corporation
more than 50% of the outstanding securities having ordinary voting
power of which shall at the time be owned, directly or indirectly, by
such Person or by one or more of its Subsidiaries or by such Person
and one or more of its Subsidiaries, or (ii) any partnership,
association, joint venture or similar business organization more than
51% of the ownership interests having ordinary voting power of which
shall at the time be so owned. Unless otherwise expressly provided,
all references herein to a "Subsidiary" shall mean a Subsidiary of the
Company.

<PAGE> 15

(or a subsequent Company Order pursuant to a Board Resolution) and any
Subsidiary of such a designated Unrestricted Subsidiary; provided,
however, that (1) the Company may not revoke the designation of an
Unrestricted Subsidiary as such (and thereby convert such Subsidiary
to a Restricted Subsidiary) if the Company would thereby breach any
covenant contained in the Indenture on the assumption that any Secured
Debt of such Subsidiary was incurred immediately after the time of
such revocation and that any Sale and Leaseback Transaction to which
such Subsidiary is then a party was entered into immediately after the
time of such revocation, and (2) until the Trustee receives from the
Company a Board Resolution (or a Company Order pursuant to a Board
Resolution) designating one or more Subsidiaries as an Unrestricted
Subsidiary, there shall be no Unrestricted Subsidiaries.

LIMITATION ON SECURED DEBT

The Company will not, and will not permit any Restricted
Subsidiary to, create, assume, or guarantee any Secured Debt without
making effective provision for securing the Debt Securities equally
and ratably with such Secured Debt (Section 5.05). This covenant does
not apply to debt secured by (i) certain purchase money Security
Interests created to secure payment for the acquisition or
construction of any property including, but not limited to, any
indebtedness incurred by the Company or a Restricted Subsidiary prior
to, at the time of, or within 180 days after the later of the
acquisition, the completion of construction (including any
improvements on an existing property) or the commencement of
commercial operation of such property (or within six months thereafter
pursuant to a commitment for such financing arranged within such 180-
day period), which indebtedness is incurred for the purpose of
financing all or any part of the purchase price of such property or
construction or improvements on such property, (ii) Security Interests
on property, or any conditional sales agreement or any title retention
with respect to property, existing at the time of acquisition thereof,
whether or not assumed by the Company or a Restricted Subsidiary,
(iii) Security Interests on property or shares of capital stock or
indebtedness of any corporation or firm existing at the time such
corporation or firm becomes a Restricted Subsidiary, (iv) Security
Interests in property or shares of capital stock or indebtedness of a
corporation existing at the time such corporation is merged into or
consolidated with the Company or a Restricted Subsidiary or at the
time of a sale, lease, or other disposition of the properties of a
corporation or firm as an entirety or substantially as an entirety to
the Company or a Restricted Subsidiary, provided that no such Security
Interests shall extend to any other Principal Property of the Company
or such Restricted Subsidiary prior to such acquisition or to other
Principal Property thereafter acquired other than additions to such
acquired property, (v) Security Interests on property of the Company
or a Restricted Subsidiary in favor of the United States of America or
any state thereof, or in favor of any other country, or any
department, agency, instrumentality or political subdivision thereof
(including, without limitation, Security Interests to secure
indebtedness of the pollution control or industrial revenue type) in

<PAGE> 16

order to permit the Company or any Restricted Subsidiary to perform a
contract or to secure indebtedness incurred for the purpose of
financing all or any part of the purchase price for the cost of
constructing or improving the property subject to such Security
Interests or which is required by law or regulation as a condition to
the transaction of any business or the exercise of any privilege,
franchise or license, (vi) Security Interests on any property or
assets of any Restricted Subsidiary to secure indebtedness owing by it
to the Company or to another Restricted Subsidiary, (vii) any
mechanics', materialmen's, carriers', landlords', warehousemen's or
other similar lien arising in the ordinary course of business
(including construction of facilities) in respect of obligations which
are not yet due or which are being contested in good faith, (viii) any
security interest arising by reason of deposits with, or the giving of
any form of security to, any governmental agency or any body created
or approved by law or governmental regulations, which is required by
law or governmental regulation as a condition to the transaction of
any business, or the exercise of any privilege, franchise or license,
(ix) any security interest for taxes, assessments or government
charges or levies not yet delinquent, or already delinquent, but the
validity of which is being contested in good faith, (x) any security
interest arising in connection with legal proceedings being contested
in good faith, including any judgment lien so long as execution
thereof is being stayed, (xi) any Security Interests arising out of
pledges or deposits under worker's compensation laws, unemployment
insurance, old age pensions, or other social security or retirement
benefits, or similar legislation or securing the performance of bids,
tenders or contracts (other than for money borrowed) or to secure
indemnity, performance or similar bonds, (xii) any easements, building
restrictions, rights-of-way and other encumbrances or charges against
property as are of a nature generally existing with respect to
properties of a similar character and which do not in any material way
affect the value of the same or interfere with the use thereof in the
business of the Company or any Restricted Subsidiary, (xiii) any
Security Interests to secure tax-exempt private activity bonds under
the Internal Revenue Code of 1986, as amended, (xiv) any Security
Interests existing on the date of the Indenture, or (xv) any
extension, renewal or replacement (or successive extensions, renewals
or replacements), in whole or in part, of any security interest
referred to in the foregoing clauses (i) to (xiv) inclusive. (Section
5.05)

LIMITATION ON SALE AND LEASEBACK TRANSACTIONS

Sale and Leaseback Transactions (which are defined to include,
among other things, certain leases of more than three years) by the
Company or any Restricted Subsidiary of any Principal Property,
completion of construction of which and commencement of full operation
of which have occurred more than 180 days prior to such sale or
transfer, will be prohibited unless either (a) the Company or such
Restricted Subsidiary would be entitled to incur Secured Debt equal in
amount to the Capitalized Rent with respect to such lease secured by a
Security Interest on the property to be leased without equally and

<PAGE> 17

ratably securing the Debt Securities, or (b) the Company or a
Restricted Subsidiary shall, within 180 days of the effective date of
any such Sale and Leaseback Transaction, apply an amount equal to the
value (as defined below) of the property so leased (subject to credits
for certain retirements of the Debt Securities) to either the
purchase of fixed assets or the retirement of Funded Debt.

The term "value" shall mean, with respect to a Sale and Leaseback
Transaction, as of any particular time, the amount equal to the
greater of (i) the net proceeds of the sale of Principal Property sold
and leased back in such Sale and Leaseback Transaction, or (ii) the
fair value of such property at the time of entering into such Sale and
Leaseback Transaction as reasonably determined by the Company, in
either case multiplied by a fraction, the numerator of which shall be
equal to the number of full years of the term of the lease applicable
to such Sale and Leaseback Transaction remaining at the time of
determination and the denominator of which shall be equal to the
number of full years of the term of such lease (without regard to any
unexercised renewal or extension options contained in such lease).
(Section 5.06)

EXEMPTED SECURED DEBT AND SALE AND LEASEBACK TRANSACTIONS

Notwithstanding the limitations on Secured Debt and Sale and
Leaseback Transactions described above, the Company and any one or
more Restricted Subsidiaries may, without securing the Debt
Securities, issue, assume, or guarantee Secured Debt which would
otherwise be subject to the foregoing restrictions, provided that,
after giving effect thereto, the aggregate amount of such Secured Debt
then outstanding (not including Secured Debt permitted under the
foregoing exceptions) and the aggregate value of Sale and Leaseback
Transactions (other than Sale and Leaseback Transactions in connection
with which indebtedness has been, or will be, retired in accordance
with clause (b) of the preceding paragraph) at such time does not
exceed 10% of Consolidated Net Tangible Assets. (Section 5.05(b))

MERGER

The Indenture provides that the Company may, without the consent
of the Holders, consolidate with, or sell, lease or convey all or
substantially all of its assets to, or merge with or into any other
corporation, provided that in any such case, (i) the successor
corporation (if other than the Company) shall be a corporation
organized and existing under the laws of the United States or a State
thereof and such corporation shall expressly assume the due and
punctual payment of the principal of (and premium, if any) and
interest on all the applicable Debt Securities, according to their
tenor, and the due and punctual performance and observance of all the
covenants and conditions of the Indenture to be performed by the
Company by supplemental indenture satisfactory in form to the Trustee,
executed and delivered to the Trustee by such corporation; and (ii)
immediately after giving effect to such transaction, no default under
the Indenture shall have occurred and be continuing. (Article Twelve)

<PAGE> 18

Other than the covenants described above, or as set forth in any
applicable Prospectus Supplement, the Indenture does not contain any
covenants or other provisions designed to afford holders of the Debt
Securities protection in the event of a takeover, recapitalization or
a highly leveraged transaction involving the Company.

MODIFICATION OF THE INDENTURE

With the consent of the holders ("Holders") of more than 50% in
aggregate principal amount of any series of Debt Securities then
outstanding under the Indenture, waivers, modifications and
alterations of the terms of the Indenture may be made which affect the
rights of the Holders of such series of Debt Securities, except that
no such modification or alteration may be made which will (a) extend
the time or terms of payment of the principal at maturity of, or the
interest on, any such series of Debt Securities, or reduce principal
or premium or the rate of interest, without the consent of the Holder
thereof, or (b) without the consent of all of the Holders of any
series of Debt Securities then outstanding, reduce the percentage of
Debt Securities of any such series, the Holders of which are required
to consent (i) to any supplemental indenture relating to such series
of Debt Securities, (ii) to rescind and annul a declaration that the
Debt Securities of any series are due and payable as a result of the
occurrence of an Event of Default, (iii) to waive any past Event of
Default under the Indenture and its consequences, and (iv) to waive
compliance with certain other provisions contained in the Indenture.
(Sections 5.08, 11.01 and 11.02) In addition, as indicated under
"Events of Default" below, Holders of more than 50% in aggregate
principal amount of the Debt Securities of any series then outstanding
may waive past Events of Default in certain circumstances and may
direct the Trustee in enforcement of remedies. (Section 7.07) The
Company and the Trustee may, without the consent of any Holders,
modify and supplement the Indenture (i) to evidence the succession of
another corporation to the Company under the Indenture; (ii) to
evidence and provide for the replacement of the Trustee; (iii) with
the Company's concurrence, to add to the covenants of the Company for
the benefit of the Holders; (iv) to modify the Indenture to permit the
qualification of any supplemental indenture under the Trust Indenture
Act of 1939; (v) to cure any ambiguity or to correct or supplement any
provision contained in the Indenture or in any supplemental indenture
which may be defective or inconsistent with any other provision
contained in the Indenture or in any supplemental indenture; (vi) to
make such other provisions in regard to matters or questions arising
under this Indenture as shall not adversely affect the interests of
the Holders of Debt Securities of the applicable series; (vii) to
change or eliminate any of the provisions of the Indenture, provided,
however, that any such change or elimination shall become effective
only when there is no Debt Security outstanding of any series created
prior to the execution of such supplemental indenture which is
entitled to the benefit of such provision; and (viii) for certain
other purposes. (Section 11.01)

<PAGE> 19

DEFEASANCE, SATISFACTION AND DISCHARGE TO MATURITY OR REDEMPTION

DEFEASANCE OF ANY SERIES

If the Company shall deposit with the Trustee, in trust, at or before
maturity or redemption, lawful money or direct obligations of the
United States (or of any other government which issued the currency in
which the Debt Securities of a series are denominated) or obligations
the principal of and interest on which are guaranteed by the United
States (or by such other government) in such amounts and maturing at
such times that the proceeds of such obligations to be received upon
the respective maturities and interest payment dates of such
obligations will provide funds sufficient, in the opinion of a
nationally-recognized firm of independent public accountants, to pay
when due the principal (and premium, if any) and interest to maturity
or to the redemption date, as the case may be, with respect to any
series of Debt Securities then outstanding, then the Company may cease
to comply with the terms of the Indenture, including the restrictive
covenants described under "Limitation on Secured Debt," and
"Limitation on Sale and Leaseback Transactions" above and the Events
of Default described in clauses (d) and (e) under "Events of Default"
below, except for (i) the Company's obligation to duly and punctually
pay the principal of (and premium, if any) and interest on such series
of Debt Securities if the Debt Securities are not paid from the money
or securities held by the Trustee, and (ii) the Events of Default
described in clauses (a), (b), (c), (f) and (g) under "Events of
Default" below, and (iii) certain other provisions of the Indenture
including, among others, those relating to registration, transfer and
exchange, lost or stolen securities, maintenance of place of payment
and, to the extent applicable to such series, the redemption and
sinking fund provisions of the Indenture. Defeasance of Debt
Securities of any series is subject to the satisfaction of certain
specified conditions, including, among others, (i) the absence of an
Event of Default at the date of the deposit, and (ii) the perfection
of the Holders' security interest in such deposit. (Section 13.02)

SATISFACTION AND DISCHARGE OF ANY SERIES

Upon the deposit of money or securities contemplated above and
the satisfaction of certain conditions, the Company may also cease to
comply with its obligation duly and punctually to pay the principal of
(and premium, if any) and interest on a particular series of Debt
Securities, or with any Events of Default with respect thereto, and
thereafter the Holders of such series of Debt Securities shall be
entitled only to payment out of the money or securities deposited with
the Trustee. Such conditions include, among others, except in certain
limited circumstances involving a deposit made within one year of
maturity or redemption, (i) the absence of an Event of Default at the
date of deposit or on the 91st day thereafter, (ii) the delivery to
the Trustee by the Company of an opinion of nationally-recognized tax
counsel, or receipt by the Company from, or publication of a ruling by
the United States Internal Revenue Service, to the effect that Holders
of the Debt Securities of such series will not recognize income, gain

<PAGE> 20

or loss for Federal income tax purposes as a result of such deposit
and discharge and will be subject to Federal income tax on the same
amounts and in the same manner and at the same times as would have
been the case if such deposit and discharge had not occurred, and
(iii) that such satisfaction and discharge will not result in the
delisting of the Debt Securities of that series from any nationally-
recognized exchange on which they are listed (if any). (Section
13.01)

EVENTS OF DEFAULT

As to any series of Debt Securities, an Event of Default is
defined in the Indenture as being: (a) default for 30 days in payment
of any interest on the Debt Securities of such series; (b) failure to
pay principal or premium with respect to the Debt Securities of such
series, if any, when due; (c) failure in the deposit of any sinking
fund installment with respect to any series of Debt Securities when
due; (d) failure to observe or perform any other covenant in the
Indenture or Debt Securities of any series (other than a covenant or
warranty, a default in whose performance or whose breach is
specifically dealt with in the section of the Indenture governing
Events of Default), if such failure continues for 60 days after
written notice by the Trustee or the Holders of at least 25% in
aggregate principal amount of the Debt Securities of such series then
outstanding; (e) an event of default as defined in any mortgage,
indenture or instrument under which there may be issued, or by which
there may be secured or evidenced, any indebtedness of the Company for
money borrowed, whether such indebtedness now exists or shall
hereafter be created, shall happen and shall result in such
indebtedness in principal amount in excess of $25,000,000 becoming or
being declared due and payable prior to the date on which it would
otherwise become due and payable, and such acceleration shall not be
rescinded or annulled, or such indebtedness shall not have been
discharged, within a period of 30 days after there shall have been
given to the Company by the Trustee, by registered mail, or to the
Company and the Trustee by the Holders of at least 25% in aggregate
principal amount of the outstanding Debt Securities of such series, a
written notice specifying such event of default and requiring the
Company to cause such acceleration to be rescinded or annulled or to
cause such indebtedness to be discharged; (f) certain events of
bankruptcy, insolvency, receivership or reorganization; or (g) any
other Event of Default provided with respect to Debt Securities of
that series. (Section 7.01) The Trustee or the Holders of 25% in
aggregate principal amount of the outstanding Debt Securities of any
series may declare the Debt Securities of such series immediately due
and payable upon the occurrence of any Event of Default (after
expiration of any applicable grace period) other than Events of
Default specified in clause (f) above. If an Event of Default
described in clause (f) occurs and is continuing, the entire principal
amount of all Debt Securities of such series and interest accrued
thereon shall become immediately due and payable without any
declaration on the part of the Trustee or any Holder. In certain
cases, the Holders of a majority in principal amount of the Debt

<PAGE> 21

Securities of any series then outstanding may waive any past default
and its consequences, except a default in the payment of principal,
premium, if any, or interest (including sinking fund payments).
(Sections 7.01 and 7.07)

The Indenture provides that the Trustee shall, within 90 days
after the occurrence of a default with respect to any such series for
which there are Debt Securities outstanding which is continuing, give
to the Holders of such Debt Securities notice of all uncured defaults
known to it (the term default to include the events specified above
without grace periods); provided that, except in the case of default
in the payment of principal (or premium, if any) or interest on any of
the Debt Securities of any series or the payment of any sinking fund
installment on the Debt Securities of any series, the Trustee shall be
protected in withholding such notice if it in good faith determines
that the withholding notice is in the interest of the Debt Security
Holders. (Section 7.08)

Subject to the provisions of the Indenture relating to the duties
of the Trustee in case an Event of Default with respect to any series
of such Debt Securities shall occur and be continuing, the Indenture
provides that the Trustee shall be under no obligation to exercise any
of its rights or powers under the Indenture at the request, order or
direction of any of the Holders of Debt Securities outstanding of any
series unless such Holders shall have offered to the Trustee
reasonable indemnity. (Sections 8.01 and 8.02) The right of a Holder
to institute a proceeding with respect to the Indenture is subject to
certain conditions precedent including notice and indemnity to the
Trustee, but the Holder has a right to receipt of principal, premium,
if any, and interest (subject to certain limitations with respect to
defaulted interest) on their due dates or to institute suit for the
enforcement thereof. (Sections 7.04 and 7.10)

So long as the Debt Securities of any series remain outstanding
the Company will be required to furnish annually to the Trustee an
Officers' Certificate stating whether, to the best of the knowledge of
the signers, the Company is in default under any of the provisions of
the Indenture, and specifying all such defaults, and the nature
thereof, of which they have knowledge. (Section 5.07) The Company will
also be required to furnish to the Trustee copies of certain reports
filed by the Company with the Commission. (Section 6.03)

The Holders of a majority in principal amount of the Debt
Securities outstanding of such series will have the right to direct
the time, method and place for conducting any proceeding for any
remedy available to the Trustee, or exercising any power or trust
conferred on the Trustee, provided that such direction shall be in
accordance with law and the provisions of the Indenture, provided that
the Trustee may decline to follow any such direction if the Trustee
shall determine on the advice of counsel that the proceeding may not
be lawfully taken or would be materially or unjustly prejudicial to
Holders not joining in such direction. (Section 7.07) The Trustee will
be under no obligation to act in accordance with such direction unless

<PAGE> 22

such Holders shall have offered the Trustee reasonable security or
indemnity against costs, expenses and liabilities which may be
incurred thereby. (Section 8.02)

GOVERNING LAW

The Indenture and the Debt Securities will be governed by, and
construed in accordance with, the laws of the State of Illinois.
(Section 15.04)

INFORMATION CONCERNING THE TRUSTEE

The First National Bank of Chicago ("First Chicago") is the
Trustee under the Indenture. First Chicago is also the agent for the
lenders, and a lender, under certain revolving credit facilities with
the Company, which as of the date hereof, permit an aggregate
borrowing of up to $330 million (subject to the terms and conditions
of such facilities). Also, First Chicago Capital Markets, Inc., an
affiliate of First Chicago, may be an agent or underwriter with
respect to the distribution of certain Debt Securities. In addition,
the Company and certain of its affiliates may maintain other banking
and business arrangements with First Chicago and its affiliates from
time to time in the future.

Under the Indenture, the Trustee is required to transmit annual
reports to all Holders regarding its eligibility and qualifications as
Trustee under the Indenture and certain related matters. (Section
6.04)

The Trustee may be deemed to have a conflicting interest for the
purpose of the Trust Indenture Act of 1939 and may be required to
resign as Trustee if (i) there is an Event of Default under the
Indenture and (ii) among other things (a) the Trustee is a trustee
under another indenture of the Company under which securities of the
Company are outstanding, (b) the Trustee is a trustee for more than
one outstanding series of Debt Securities under a single Indenture,
(c) the Trustee is a creditor of the Company, or (d) the Trustee of an
affiliate of the Trustee acts as underwriter or agent for the Company.

The Indenture provides that an alternative Trustee may be
appointed by the Company with respect to any particular series of Debt
Securities. Any such appointment will be described in the Prospectus
Supplement relating to the issuance of such series of Debt Securities.
PLAN OF DISTRIBUTION

The Company may sell Debt Securities (i) through underwriters or
dealers, (ii) directly to one or more purchasers, or (iii) through
agents. A Prospectus Supplement will set forth the terms of the
offering of the Debt Securities offered thereby, including the name or
names of any underwriters, the purchase price of the Debt Securities,
and the proceeds to the Company from the sale, any underwriting
discounts and other items constituting underwriters' compensation, any
public offering price, any discounts or concessions allowed or

<PAGE> 23

reallowed or paid to dealers, and any securities exchange or market on
which the Debt Securities may be listed.

If underwriters are used in the sale, the Debt Securities will be
acquired by the underwriters for their own account and may be resold
from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices
determined at the time of sale. The obligations of the underwriters to
purchase the Debt Securities will be subject to certain conditions
precedent, and the underwriters will be obligated to purchase all the
Debt Securities of the series offered by the Prospectus Supplement if
any of the Debt Securities are purchased. Any public offering price
and any discounts or concessions allowed or reallowed or paid to
dealers may be changed from time to time.

Debt Securities may also be sold directly by the Company or
through agents designated by the Company from time to time. Any agent
involved in the offering and sale of Debt Securities in respect of
which this Prospectus is delivered will be named, and any commissions
payable by the Company to such agent will be set forth, in the
Prospectus Supplement.

All Debt Securities offered will be a new issue of securities
with no established trading market. Any underwriters to whom such Debt
Securities are sold by the Company for public offering and sale may
make a market in such Debt Securities, but such underwriters will not
be obligated to do so and may discontinue any market making at any
time without notice. No assurance can be given as to the liquidity of
or the trading markets for any such Debt Securities.

Agents and underwriters may be entitled under agreements entered
into with the Company to indemnification by the Company against
certain civil liabilities, including liabilities under the Securities
Act that may arise from any untrue statement or alleged untrue
statement of a material fact or any omission or alleged omission to
state a material fact in this Prospectus, any supplement or amendment
hereto, or in the Registration Statement of which this Prospectus
forms a part, or to contribution with respect to payments which the
agents or underwriters may be required to make in respect thereof.
Agents and underwriters may engage in transactions with, or perform
services for, the Company in the ordinary course of business.

LEGAL OPINIONS

The legality of the Debt Securities will be passed upon for the
Company by Schiff Hardin & Waite, Chicago, Illinois. Certain legal
matters will be passed upon for any underwriters or agents by Mayer,
Brown & Platt, Chicago, Illinois.

EXPERTS

The consolidated financial statements of the Company incorporated
by reference in the Company's Annual Report on Form 10-K for the year

<PAGE> 24

ended June 30, 1997, have been audited by Ernst & Young LLP,
independent auditors, as set forth in their report thereon included
therein and incorporated herein by reference. Such consolidated
financial statements are incorporated herein by reference in reliance
upon such report given upon the authority of such firm as experts in
accounting and auditing.

<PAGE> 25

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table sets forth the estimated expenses in
connection with the issuance and distribution of the securities
registered hereby, other than underwriting discounts and commissions:

Securities and Exchange Commission registration fee . . . . . $295,000
Trustee's fees and expenses . . . . . . . . . . . . . . . . . . 10,000
Printing expenses . . . . . . . . . . . . . . . . . . . . . . . 20,000
Rating agency fees . . . . . . . . . . . . . . . . . . . . . 155,000
Accounting fees and expenses . . . . . . . . . . . . . . . . . 40,000
Legal fees and expenses . . . . . . . . . . . . . . . . . . . 100,000
Blue Sky fees and expenses . . . . . . . . . . . . . . . . . . 5,000
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . 50,000

Total . . . . . . . . . . . . . . . . . . . . . . . . . $675,000

ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS.

Section 6.7 of the By-Laws of the Company, and Article 9 of its
Restated Articles of Incorporation, both provide for indemnification
of officers and directors and the Company against expenses incurred by
any of them in certain stated proceedings and under certain stated
conditions.

Chapter 37 of the Indiana Business Corporation Law authorizes
every Indiana corporation to indemnify its officers and directors
under certain circumstances against liability incurred in connection
with the defense of proceedings in which they are made parties, or
threatened to be made parties, by reason of such relationship to the
corporation, except where they are adjudged liable for specific types
of negligence or misconduct in the performance of their duties to the
corporation. Chapter 37 also requires every Indiana corporation to
indemnify any of its directors and, unless such corporation's articles
of incorporation provide otherwise, any of its officers who are wholly
successful, on the merits or otherwise, in the defense of any such
proceeding against reasonable expenses incurred by such director in
connection with such proceeding.

Officers and directors of the Company are presently covered by
insurance which (with certain exceptions and within certain
limitations) indemnifies them against any losses or liabilities
arising from any alleged "wrongful act," including any breach of duty,
neglect, error, misstatement, misleading statement, omission or other
acts done or wrongfully attempted.

<PAGE> 26

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

See Exhibit Index included herewith which is incorporated herein
by reference.

ITEM 17. UNDERTAKINGS.

The undersigned registrant hereby undertakes:

(a) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:

(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a 20
percent change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
registration statement;

(iii) To include any material information with respect
to the plan of distribution not previously disclosed in the
registration statement or any material change to such information
in the registration statement;

Provided, however, that paragraphs (a)(i) and (a)(ii) do not apply if
the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or
furnished to the Commission by the registrant pursuant to Section 13
or 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the registration statement

(b) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.

(c) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.

<PAGE> 27

The undersigned registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.

Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers or
persons controlling the registrant pursuant to the provisions set
forth or described in Item 15 of this Registration Statement, or
otherwise, the registrant has been informed that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Securities Act and is therefore
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Securities Act of 1933
and will be governed by the final adjudication of such issue.

<PAGE> 28

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Chicago, State
of Illinois on the 1st day of May, 1998.

MORTON INTERNATIONAL, INC.

By: /s/ T.F. Mc Devitt
------------------------------
T.F. McDevitt
Vice President Finance and
Chief Financial Officer

POWER OF ATTORNEY

Each person whose signature appears below on this Registration
Statement hereby constitutes and appoints T.F. McDevitt as his or her
true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for him or her and in his or her
name, place and stead, in any and all capacities (unless revoked in
writing), to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with
all exhibits thereto, and other documents in connection therewith,
with the Securities and Exchange Commission, granting to such
attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in
connection therewith, as fully to all intents and purposes as he or
she might or could do in person, hereby ratifying and confirming all
that said attorney-in-fact and agent, or his substitute, may lawfully
do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on the 1st day of May, 1998.

SIGNATURE TITLE
--------- -----

Chairman of the Board, Chief
/s/ S.J. Stewart Executive
-------------------------------- Officer and Director
S.J. Stewart (Principal Executive
Officer)

<PAGE> 29

SIGNATURE TITLE
--------- -----

/s/ T.F. McDevitt Vice President Finance and
-------------------------------- Chief Financial Officer
T.F. McDevitt (Principal Financial
Officer)

/s/ L.N. Liszt Controller (Principal
-------------------------------- Accounting Officer)
L.N. Liszt

/s/ R.M. Barford Director
--------------------------------
R.M. Barford

/s/ J.R. Cantalupo Director
--------------------------------
J.R. Cantalupo

/s/ W.T. Creson Director
--------------------------------
W.T. Creson

/s/ W.J. Farrell Director
--------------------------------
W.J. Farrell

/s/ D.C. Fill Director
--------------------------------
D.C. Fill

/s/ W. E. Johnston Director
--------------------------------
W.E. Johnston

/s/ R.L. Keyser Director
--------------------------------
R.L. Keyser

/s/ R.A. McDonald Director
--------------------------------
R.A. McDonald

<PAGE> 30

SIGNATURE TITLE
--------- -----

/s/ E.J. Mooney Director
--------------------------------
E.J. Mooney

/s/ G. A. Schaefer Director
--------------------------------
G.A. Schaefer

/s/ R.W. Stone Director
--------------------------------
R.W. Stone

<PAGE> 31

EXHIBIT INDEX

EXHIBIT
NUMBER DESCRIPTION
------- -----------

1.1 Form of Underwriting Agreement
4.1 Form of Indenture, dated as of __________, 1998, between the
Registrant and The First National Bank of Chicago.
5 Opinion of Schiff Hardin & Waite
12 Statement Regarding Computation of Ratios
23.1 Consent of Schiff Hardin & Waite (included in the opinion
filed as Exhibit 5 to this Registration Statement
23.2 Consent of Ernst & Young LLP
24 Powers of Attorney (included on the signature page of this
Registration Statement)
25 Statement of Eligibility of The First National Bank of
Chicago on Form T-1

EXHIBIT 1.1

FORM OF UNDERWRITING AGREEMENT
------------------------------

MORTON INTERNATIONAL, INC.

DEBT SECURITIES

UNDERWRITING AGREEMENT

New York, New York
____________, 1998

To the Representatives
named in Schedule I
hereto of the Underwriters
named in Schedule II hereto

Dear Sirs:

Morton International, Inc., an Indiana corporation (the
"Company"), proposes to issue and sell to the underwriter or
underwriters named in Schedule II hereto (the "Underwriters"), for
whom the representative or representatives, if any, named in Schedule
I hereto (the "Representatives") are acting as representative or
representatives, the principal amount as set forth in Schedule II
hereto of debt securities to be issued under an indenture, dated as of
________, 1998 (the "Indenture"), between the Company and The First
National Bank of Chicago, as Trustee (the "Trustee"), and identified
in Schedule I hereto as "Securities," less the amount of Securities
covered by Delayed Delivery Contracts (as defined in Section 2
hereof), if any, as provided in Section 2 hereof and as may be
specified in Schedule I hereto (any Securities to be covered by
Delayed Delivery Contracts being herein sometimes referred to as
"Contract Securities" and the Securities to be purchased by the
Underwriters (after giving effect to the deduction, if any, for
Contract Securities) being herein sometimes referred to as
"Underwriters' Securities"). If the firm or firms listed in Schedule
II hereto include only the firm or firms listed in Schedule I hereto,
then the terms "Underwriters" and "Representatives", as used herein,
shall each be deemed to refer to such firm or firms. The term
"Representatives" also refers to a single firm acting as sole
representative of the Underwriters.

1. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to, and agrees with, each Underwriter as set forth below
in this Section 1. Certain terms used in this Section 1 are
defined in paragraph (e) hereof.

<PAGE> 33

(a) The Company meets the requirements for the use of Form S-3
under the Securities Act of 1933 (the "Act") and has filed with the
Securities and Exchange Commission (the "Commission") a registration
statement (the file number of which is set forth in Schedule I hereto)
on such Form, including a basic prospectus, for registration under the
Act of the offering and sale of the Securities. The Company may have
filed one or more amendments thereto, and may have used a Preliminary
Final Prospectus, each of which has previously been furnished to you.
Such registration statement, as so amended, has become effective.
When such registration statement became effective, the Basic
Prospectus did not include all the information with respect to the
Securities and the offering thereof required by the Act and the rules
thereunder to be included in the Final Prospectus, though it included
all such information required by the Act and the rules thereunder to
be included therein as of the Effective Date. The Company will next
file with the Commission pursuant to Rules 415 and 424(b)(2) or (5) a
final supplement to the form of prospectus included in such
registration statement relating to the Securities and the offering
thereof. As filed, such final prospectus supplement shall include all
required information with respect to the Securities and the offering
thereof and, except to the extent the Representatives shall agree in
writing to a modification, shall be in all substantive respects in the
form furnished to you prior to the Execution Time or, to the extent
not completed at the Execution Time, shall contain only such specific
additional information and other changes (beyond that contained in the
Basic Prospectus and any Preliminary Final Prospectus) as the Company
has advised you, prior to the Execution Time, will be included or made
therein.

(b) On the Effective Date, the Registration Statement did, and
when the Final Prospectus is first filed in accordance with Rule
424(b) and on the Closing Date, the Final Prospectus (and any
supplement thereto) will, comply in all material respects with the
applicable requirements of the Act, the Securities Exchange Act of
1934 (the "Exchange Act") and the Trust Indenture Act of 1939 (the
"Trust Indenture Act") and the respective rules thereunder; on the
Effective Date, the Registration Statement did not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein not misleading; on the Effective Date and on the
Closing Date the Indenture did or will comply in all material respects
with the requirements of the Trust Indenture Act and the rules
thereunder; and, on the date of the filing pursuant to Rule 424(b),
and on the Closing Date, the Final Prospectus (together with any
supplement thereto) will not, include any untrue statement of a
material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; PROVIDED, HOWEVER, that the
Company makes no representations or warranties as to (i) that part of
the Registration Statement which shall constitute the Statement of
Eligibility (Form T-1) under the Trust Indenture Act of the Trustee or
(ii) the information contained in or omitted from the Registration
Statement or the Final Prospectus (or any supplement thereto) in

<PAGE> 34

reliance upon and in conformity with information furnished in writing
to the Company by or on behalf of any Underwriter through the
Representatives specifically for inclusion in the Registration
Statement or the Final Prospectus (or any supplement thereto).

(c) The documents incorporated by reference in the Final
Prospectus, at the time they were or hereafter are filed with the
Commission, complied or when so filed will comply, as the case may be,
in all material respects with the requirements of the Exchange Act and
the rules and regulations of the Commission thereunder, and, when read
together and with the other information in the Final Prospectus, did
not and will not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were or are made, not misleading.

(d) Other than as set forth in the Final Prospectus, there are
no legal or governmental proceedings pending to which the Company or
any of its Subsidiaries is a party or of which any property of the
Company or any of its Subsidiaries is the subject which, if determined
adversely to the Company or any of its Subsidiaries, would
individually or in the aggregate have a material adverse effect on the
business, properties, financial condition, stockholders' equity or
results of operations of the Company and its subsidiaries taken as a
whole; and, to the best of the Company's knowledge, no such
proceedings are threatened or contemplated by governmental authorities
or threatened by others.

(e) The terms which follow, when used in this Agreement, shall
have the meanings indicated. "Effective Date" shall mean each date
that the Registration Statement and any post-effective amendment or
amendments thereto became or becomes effective. "Execution Time"
shall mean the date and time that this Agreement is executed and
delivered by the parties hereto. "Basic Prospectus" shall mean the
prospectus referred to in paragraph (a) above contained in the
Registration Statement at the Effective Date. "Preliminary Final
Prospectus" shall mean any preliminary prospectus supplement to the
Basic Prospectus which describes the Securities and the offering
thereof and is used prior to filing of the Final Prospectus. "Final
Prospectus" shall mean the prospectus supplement relating to the
Securities that is first filed pursuant to Rule 424(b) after the
Execution Time, together with the Basic Prospectus. "Registration
Statement" shall mean the registration statement referred to in
paragraph (a) above, including incorporated documents, exhibits and
financial statements, as amended at the Execution Time and, in the
event any post-effective amendment thereto becomes effective prior to
the Closing Date (as hereinafter defined), shall also mean such
registration statement as so amended. "Rule 415", "Rule 424" and
"Regulation S-K" refer to such rules or regulation under the Act. Any
reference herein to the Registration Statement, the Basic Prospectus,
any Preliminary Final Prospectus or the Final Prospectus shall be
deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 which were filed under the

<PAGE> 35

Exchange Act on or before the Effective Date of the Registration
Statement or the issue date of the Basic Prospectus, any Preliminary
Final Prospectus or the Final Prospectus, as the case may be; and any
reference herein to the terms "amend", "amendment" or "supplement"
with respect to the Registration Statement, the Basic Prospectus, any
Preliminary Final Prospectus or the Final Prospectus shall be deemed
to refer to and include the filing of any document under the Exchange
Act after the Effective Date of the Registration Statement or the
issue date of the Basic Prospectus, any Preliminary Final Prospectus
or the Final Prospectus, as the case may be, deemed to be incorporated
therein by reference.

2. PURCHASE AND SALE. Subject to the terms and conditions and
in reliance upon the representations and warranties herein set forth,
the Company agrees to sell to each Underwriter, and each Underwriter
agrees, severally and not jointly, to purchase from the Company, at
the purchase price set forth in Schedule I hereto, the principal
amount of Securities set forth opposite such Underwriter's name in
Schedule II hereto, except that if Schedule I hereto provides for the
sale of Securities pursuant to delayed delivery arrangements, the
respective principal amounts of Securities to be purchased by the
Underwriters shall be as set forth in Schedule II hereto, less the
respective amounts of Contract Securities determined as provided
below.

If so provided in Schedule I hereto, the Underwriters are
authorized to solicit offers to purchase Securities from the Company
pursuant to delayed delivery contracts ("Delayed Delivery Contracts"),
substantially in the form of Schedule III hereto but with such changes
therein as the Company may authorize or approve. The Underwriters
will endeavor to make such arrangements and, as compensation therefor,
the Company will pay to the Representatives, for the account of the
Underwriters, on the Closing Date, the compensation set forth in
Schedule I hereto with respect to Securities for which Delayed
Delivery Contracts are made. Delayed Delivery Contracts are to be
with institutional investors, including commercial and savings banks,
insurance companies, pension funds, investment companies and
educational and charitable institutions. The Company will make
Delayed Delivery Contracts in all cases where sales of Contract
Securities arranged by the Underwriters have been approved by the
Company but, except as the Company may otherwise agree, each such
Delayed Delivery Contract must be for not less than the minimum amount
set forth in Schedule I hereto and the aggregate amount of Contract
Securities may not exceed the maximum aggregate amount set forth in
Schedule I hereto. The Underwriters will not have any responsibility
in respect of the validity or performance of Delayed Delivery
Contracts. The amount of Securities to be purchased by each
Underwriter as set forth in Schedule II hereto shall be reduced by an
amount which shall bear the same proportion to the total amount of
Contract Securities as the amount of Securities set forth opposite the
name of such Underwriter bears to the aggregate amount set forth in
Schedule II hereto, except to the extent that you determine that such
reduction shall be otherwise than in such proportion and so advise the

<PAGE> 36

Company in writing; PROVIDED, HOWEVER, that the total amount of
Securities to be purchased by all Underwriters shall be the aggregate
amount set forth in Schedule II hereto, less the aggregate amount of
Contract Securities.

3. DELIVERY AND PAYMENT. Delivery of and payment for the
Securities shall be made at the office, on the date and at the time
specified in Schedule I hereto, which date and time may be postponed
by agreement between the Representatives and the Company or as
provided in Section 9 hereof (such date and time of delivery and
payment for the Securities being herein called the "Closing Date").
Delivery of the Underwriters' Securities shall be made to the
Representatives for the respective accounts of the several
Underwriters against payment by the several Underwriters through the
Representatives of the purchase price thereof in the manner set forth
in Schedule I hereto. Delivery of the Securities shall be made
through the facilities of The Depository Trust Company unless the
Representatives shall otherwise instruct. Certificates for the
Underwriters' Securities shall be registered in such names and in such
denominations as the Representatives may request not less than two
business days in advance of the Closing Date.

The Company agrees to have the Underwriters' Securities (if other
than in global form) available for inspection, checking and packaging
by the Representatives in New York, New York, not later than 1:00 p.m.
on the business day prior to the Closing Date.

Concurrently with the delivery of and payment for the
Underwriters' Securities, the Company will deliver to the
Representatives for the accounts of the Underwriters a check payable
to the order of the party designated in Schedule I in the amount of
any compensation payable by the Company to the Underwriters in respect
of any Delayed Delivery Contracts as provided in Section 2 hereof and
in Schedule I hereto.

4. OFFERING BY UNDERWRITERS. It is understood that the several
Underwriters propose to offer the Securities for sale to the public as
set forth in the Prospectus.

5. AGREEMENTS. The Company agrees with the several
Underwriters that:

(a) Prior to the termination of the offering of the Securities,
the Company will not file any amendment of the Registration Statement
or supplement to the Basic Prospectus or Final Prospectus or any Rule
462(b) Registration Statement unless the Company has furnished you a
copy for your review prior to filing and will not file any such
proposed amendment or supplement to which you reasonably object.
Subject to the foregoing sentence, the Company will cause the Final
Prospectus, properly completed, and any supplement thereto to be filed
with the Commission pursuant to the applicable paragraph of Rule
424(b) within the time period prescribed and will provide evidence
satisfactory to the Representatives of such timely filing. The

<PAGE> 37

Company will promptly advise the Representatives (1) when the Final
Prospectus, and any supplement thereto, shall have been filed with the
Commission pursuant to Rule 424(b) or when any Rule 462(b)
Registration Statement shall have been filed with the Commission, (2)
when, prior to termination of the offering of the Securities, any
amendment to the Registration Statement shall have been filed or
become effective, (3) of any request by the Commission or its staff
for any amendment of the Registration Statement, or any Rule 462(b)
Registration Statement, or for any supplement to the Final Prospectus
or for any additional information, (4) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any
proceeding for that purpose and (5) of the receipt by the Company of
any notification with respect to the suspension of the qualification
of the Securities for sale in any jurisdiction or the institution or
threatening of any proceeding for such purpose. The Company will use
its best efforts to prevent the issuance of any such stop order or the
suspension of any such qualification and, if issued, to obtain as soon
as possible the withdrawal thereof.

(b) If, at any time when a prospectus relating to the Securities
is required to be delivered under the Act, any event occurs as a
result of which the Final Prospectus as then supplemented would
include any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein in the light of
the circumstances under which they were made not misleading, or if it
shall be necessary to amend the Registration Statement or supplement
the Final Prospectus to comply with the Act or the Exchange Act or the
respective rules thereunder, the Company promptly will (1) notify the
Representatives of such event; (2) prepare and file with the
Commission, subject to the first sentence of paragraph (a) of this
Section 5, an amendment or supplement which will correct such
statement or omission or effect such compliance; and (3) supply any
supplemented Final Prospectus to you in such quantities as you may
reasonably request.

(c) As soon as practicable, the Company will make generally
available to its security holders and to the Representatives an
earnings statement or statements of the Company and its subsidiaries
which will satisfy the provisions of Section 11(a) of the Act and Rule
158 under the Act.

(d) The Company will furnish to the Representatives and counsel
for the Underwriters, without charge, signed copies of the
Registration Statement (including exhibits thereto) and to each other
Underwriter a copy of the Registration Statement (without exhibits
thereto) and, so long as delivery of a prospectus by an Underwriter or
dealer may be required by the Act, as many copies of each Preliminary
Final Prospectus and the Final Prospectus and any supplement thereto
as the Representatives may reasonably request. The Company will pay
the expenses of printing or other production of all documents relating
to the offering.

<PAGE> 38

(e) The Company will arrange, if necessary, for the
qualification of the Securities for sale under the laws of such
jurisdictions as the Representatives may designate, will maintain such
qualifications in effect so long as required for the distribution of
the Securities and will pay any fee of the National Association of
Securities Dealers, Inc., in connection with its review of the
offering; provided that in no event shall the Company be obligated to
do business in any jurisdiction where it is not now so qualified or to
take any action that would subject it to service of process in suits,
other than those arising out of the offering or sale of the Securities
in any jurisdiction where it is not now so subject.

(f) The Company will pay or cause to be paid the following: (i)
the fees, disbursements and expenses of the Company's counsel and
accountants in connection with the registration of the Securities
under the Act and all other expenses in connection with the
preparation, printing and filing of the Registration Statement, the
Basic Prospectus, any Preliminary Final Prospectus and the Final
Prospectus and amendments thereof and supplements thereto and the
mailing and delivering of copies thereof to the Underwriters and
dealers; (ii) the expenses of printing all documents relating to the
offering (other than any agreement among Underwriters relating to the
offering of the Securities); (iii) all expenses in connection with the
qualification of the Securities for offering and sale under state
securities laws as provided in Section 5(e) hereof, including the fees
and disbursements of counsel for the Underwriters in connection with
such qualification and in connection with the Blue Sky and legal
investment surveys; (iv) any fees charged by securities rating
agencies for rating the Securities; (v) the cost of preparing the
Securities; (vi) the fees and expenses of the Trustee and any agent
thereof and the fees and disbursements of counsel for the Trustee in
connection with this Agreement, the Indenture and the Securities; and
(vii) all other costs and expenses incident to the performance of its
obligations hereunder which are not otherwise specifically provided
for in this Section. It is understood, however, that, except as
provided in this Section, Section 7 and Section 8 hereof, the
Underwriters will pay all of their own costs and expenses, including
the fees and disbursements of their counsel, transfer taxes on resale
of any of the Securities by them, and any advertising expenses
connected with any offers they may make.

(g) The Company will not, without the prior written consent of
Salomon Brothers Inc, from the date hereof to and including the
business day following the Closing Date, offer, sell or contract to
sell, or otherwise dispose of (or enter into any transaction which is
designed to, or might reasonably be expected to, result in the
disposition (whether by actual disposition or effective economic
disposition due to cash settlement or otherwise) by the Company (or
any affiliate of the Company or any person in privity with the Company
or any affiliate of the Company pursuant to a written agreement with
the Company to do so) directly or indirectly, or announce the offering
of any debt securities issued or guaranteed by the Company (other than

<PAGE> 39

the Securities, any commercial paper, any variable rate demand notes
and any bid notes).

(h) The Company will not take, directly or indirectly, any
action designed to or which has constituted or which might reasonably
be expected to cause or result, under the Exchange Act or otherwise,
in stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.

6. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the Underwriters to purchase the Securities shall be
subject to the accuracy of the representations and warranties on the
part of the Company contained herein as of the date hereof and the
Closing Date, to the accuracy of the statements of the Company made in
any certificates pursuant to the provisions hereof, to the performance
by the Company of its obligations hereunder and to the following
additional conditions:

(a) No stop order suspending the effectiveness of the
Registration Statement, as amended from time to time, shall have been
issued and no proceedings for that purpose shall have been instituted
or threatened; and the Final Prospectus shall have been filed or
mailed or transmitted for filing with the Commission not later than
5:00 p.m. New York City time on the second business day following the
date hereof.

(b) The Company shall have furnished to the Representatives the
opinion of Raymond P. Buschmann, Vice President for Legal Affairs
and General Counsel of the Company, dated the Closing Date and
addressed to the Representatives, to the effect that:

(i) The Company has been duly incorporated and is validly
existing as a corporation under the laws of the State of Indiana,
with full corporate power and authority to own its properties and
conduct its business as described in the Final Prospectus, and
has been duly qualified as a foreign corporation for the
transaction of business and is in good standing under the laws of
each other jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such qualification, or is
subject to no liability or disability by reason of the failure to
be so qualified in any such jurisdiction which would have a
material adverse effect on the Company and its subsidiaries
(taken as a whole).

(ii) Each "significant subsidiary" of the Company (as such
term is defined in Rule 1-02 of Regulation S-X promulgated under
the Act) (each, a "Subsidiary" and, collectively, the
"Subsidiaries") has been duly incorporated and is validly
existing as a corporation in good standing (to the extent such
term is applicable) under the laws of the jurisdiction of its
incorporation, with full corporate power and authority to own its
properties and conduct its business as described in the
Prospectus, and has been duly qualified as a foreign corporation

<PAGE> 40

for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases
properties, or conducts any business, so as to require such
qualification, or is subject to no liability or disability by
reason of the failure to be so qualified in any such jurisdiction
which would have a material adverse effect on the Company and its
subsidiaries (taken as a whole).

(iii) All the outstanding shares of capital stock of
each Subsidiary have been duly and validly authorized and issued
and are fully paid and nonassessable, and, except as otherwise
set forth in the Final Prospectus, all outstanding shares of
capital stock of the Subsidiaries are owned by the Company either
directly or through wholly owned subsidiaries free and clear of
any perfected security interest and, to the knowledge of such
counsel, after due inquiry, any other security interests, claims,
liens or encumbrances.

(iv) There are no pending or, to the knowledge of such
counsel, threatened in writing legal or governmental proceedings
to which the Company or any of its Subsidiaries is a party or of
which any property of the Company or any of its Subsidiaries is
the subject of a character required to be disclosed in the
Registration Statement which is not adequately disclosed in the
Final Prospectus; there is no contract or other document of a
character required to be described in the Registration Statement
or Final Prospectus, or to be filed as an exhibit, which is not
described or filed as required; and the statements included or
incorporated by reference in the Final Prospectus describing any
legal proceedings or material contracts or agreements relating to
the Company fairly summarize such matters.

(v) The issue and sale of the Securities [(including the
Contract Securities)] and the compliance by the Company with all
of the provisions of the Securities, the Indenture and this
Agreement [and any Delayed Delivery Contracts] and the
consummation of the transactions herein and therein contemplated
will not conflict with or result in a breach or violation of any
of the terms or provisions of, or constitute a default under, any
material indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets
of the Company or any of its subsidiaries is subject, nor will
such action result in any violation of the provisions of the
Certificate of Incorporation or By-laws of the Company or any
statute or any order, rule or regulation known to such counsel of
any court or governmental agency having jurisdiction over the
Company or any of its subsidiaries or any of their respective
properties.

In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction

<PAGE> 41

other than the State of Illinois or the United States, to the
extent deemed proper and specified in such opinion, upon the
opinion of other counsel of good standing believed to be reliable
and who are satisfactory to counsel for the Agent and (B) as to
matters of fact, to the extent deemed proper, on certificates of
responsible officers of the Company and public officials.
References to the Final Prospectus in this paragraph (b) include
any supplements thereto at the date such opinion is rendered. The
opinion or opinions of such counsel shall be rendered to the
Underwriters at the request of the Company and shall so state
therein.

(c) The Company shall have furnished to the Representatives the
opinion of Schiff Hardin & Waite, counsel for the Company, dated the
Closing Date and addressed to the Representatives, to the effect that:

(i) This Agreement has [and any Delayed Delivery Contracts
have] been duly authorized, executed and delivered by the
Company.

(ii) The Indenture has been duly authorized, executed and
delivered by the Company and (assuming the due authorization,
execution and delivery hereof by the Trustee) is a valid and
legally binding obligation of the Company enforceable in
accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or
other laws relating to or affecting enforcement of creditors'
rights generally or by general equity principles; and the
Indenture has been duly qualified under the Trust Indenture Act.

(iii) The Securities [(including the Contract
Securities)] have been duly and validly authorized for issuance,
offer and sale pursuant to this Agreement (and the Delayed
Delivery Contracts] and, when issued, authenticated and delivered
pursuant to the provisions of this Agreement [, the Delayed
Delivery Contracts] and the Indenture against payment of the
consideration therefor specified in the Final Prospectus or
agreed upon pursuant to the provisions of this Agreement [and the
Delayed Delivery Contracts], the Securities will constitute valid
and legally binding obligations of the Company enforceable in
accordance with their terms, except as enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or
other laws relating to or affecting enforcement of creditors'
rights generally or by general equity principles; and the
Securities and the Indenture conform to the descriptions thereof
in the Final Prospectus.

(iv) No consent, approval, authorization, order or decree of
any court or governmental agency or body is required for the
consummation by the Company of the transactions contemplated by
this Agreement [and any Delayed Delivery Contract] or in connec-
tion with the sale of Securities [(including the Contract
Securities)] hereunder, except such as have been obtained or

<PAGE> 42

rendered, as the case may be, or as may be required under state
securities ("Blue Sky") laws.

(v) The Company is not an "investment company" as such term
is defined in the Investment Company Act.

(vi) The Registration Statement has become effective under
the Act; any required filing of the Basic Prospectus, any
Preliminary Final Prospectus or the Final Prospectus, and any
supplements thereto, pursuant to Rule 424(b) has been be made in
the manner and within the time period required by Rule 424(b); to
the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or
threatened; and the Registration Statement and the Final
Prospectus (other than the financial statements and other
financial and statistical information contained therein as to
which such counsel need express no opinion) comply as to form in
all material respects with the applicable requirements of the
Act, the Exchange Act and the Trust Indenture Act and the
respective rules thereunder.

In rendering such opinion, such counsel shall also state
that in connection with its representation of the Company in
connection with the offer and sale of the Securities pursuant
hereto, nothing has come to the attention of such counsel that
leads it to believe that the Registration Statement at the
Effective Date contained any untrue statement of a material fact
or omitted to state any material fact required to be stated
therein or necessary to make the statements therein not
misleading or that the Final Prospectus as of its date and as of
the Closing Date included or includes any untrue statement of a
material fact or omits to state a material fact necessary to make
the statements therein, in the light of the circumstances under
which they were made, not misleading.

In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction
other than the States of Illinois and Indiana or the United
States, to the extent deemed proper and specified in such
opinion, upon the opinion of other counsel of good standing
believed to be reliable and who are satisfactory to counsel for
the Agent and (B) as to matters of fact, to the extent deemed
proper, on certificates of responsible officers of the Company
and public officials. References to the Final Prospectus in this
paragraph (c) include any supplements thereto at the date such
opinion is rendered. The opinion or opinions of such counsel
shall be rendered to the Underwriters at the request of the
Company and shall so state therein.

(d) The Representatives shall have received from Mayer, Brown &
Platt, counsel for the Underwriters, such opinion or opinions, dated
the Closing Date and addressed to the Representatives, with respect to

<PAGE> 43

the issuance and sale of the Securities, the Indenture, the
Registration Statement, the Final Prospectus (together with any
supplement thereto) and other related matters as the Representatives
may reasonably require, and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling
them to pass upon such matters. The opinion of such counsel shall be
rendered to the Underwriters at the request of the Company and shall
so state therein.

(e) The Company shall have furnished to the Representatives a
certificate of the Company, signed by any two of the Chief Executive
Officer, the President, the Vice President Finance, the Treasurer or
the Vice President for Legal Affairs of the Company, dated the Closing
Date, to the effect that the signers of such certificate have
carefully examined the Registration Statement, the Final Prospectus,
any supplements to the Final Prospectus and this Agreement and that:

(i) the representations and warranties of the Company in
this Agreement are true and correct in all material respects on
and as of the Closing Date with the same effect as if made on the
Closing Date and the Company has complied with all the agreements
and satisfied all the conditions on its part to be performed or
satisfied at or prior to the Closing Date;

(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for
that purpose have been instituted or, to the Company's knowledge,
threatened; and

(iii) since the date of the most recent financial
statements included in the Final Prospectus (exclusive of any
supplement thereto), there has been no material adverse change in
the business, properties, financial condition, stockholders'
equity or results of operations of the Company and its
subsidiaries taken as a whole, whether or not arising in the
ordinary course of business, except as set forth in or
contemplated in the Final Prospectus (exclusive of any supplement
thereto).

(f) At the date hereof and at the Closing Date, Ernst & Young,
LLP shall have furnished to the Representatives a letter, dated as of
the date hereof and as of the Closing Date, in form and substance
satisfactory to the Representatives, confirming that they are
independent accountants within the meaning of the Act and the Exchange
Act and the respective applicable published rules and regulations
thereunder and stating, as of such date hereof or the Closing Date, as
the case may be, (or with respect to matters involving changes or
developments since the respective dates as of which specified
financial information is given in the Final Prospectus, as of a date
not more than five days prior to either such date), the conclusions
and findings of such firm with respect to the financial information
and other matters as provided in SAS No. 72.

<PAGE> 44

References to the Final Prospectus in this paragraph (f) include
any supplement thereto at the date of the letter.

(g) Subsequent to the date hereof or, if earlier, the dates as
of which information is given in the Registration Statement (exclusive
of any amendment thereof) and the Final Prospectus (exclusive of any
supplement thereto), there shall not have been (i) any change or
decrease specified in the letter or letters referred to in paragraph
(f) of this Section 6 or (ii) any change, or any development involving
a prospective change, in or affecting the business, properties,
financial condition, stockholders' equity or results of operations of
the Company and its subsidiaries taken as a whole, whether or not
arising in the ordinary course of business, except as set forth in or
contemplated in the Final Prospectus (exclusive of any supplement
thereto) the effect of which, in any case referred to in clause (i) or
(ii) above, is, in the sole judgment of the Representatives, so
material and adverse as to make it impractical or inadvisable to
proceed with the offering or delivery of the Securities as
contemplated by the Registration Statement (exclusive of any amendment
thereof) and the Final Prospectus (exclusive of any supplement
thereto).

(h) Subsequent to the date hereof, there shall not have been any
decrease in the rating of any of the Company's debt securities by any
"nationally recognized statistical rating organization" (as defined
for purposes of Rule 436(g) under the Act) or any notice given of any
intended or potential decrease in any such rating or of a possible
change in any such rating that does not indicate the direction of the
possible change.

(i) Prior to the Closing Date, the Company shall have furnished
to the Representatives such further information, certificates and
documents as the Representatives may reasonably request.

(j) The Company shall have accepted Delayed Delivery Contracts
in any case where sales of Contract Securities arranged by the
Underwriters have been approved by the Company.

If any of the conditions specified in this Section 6 shall not
have been fulfilled in all material respects when and as provided in
this Agreement, or if any of the opinions and certificates mentioned
above or elsewhere in this Agreement shall not be in all material
respects reasonably satisfactory in form and substance to the
Representatives and counsel for the Underwriters, this Agreement and
all obligations of the Underwriters hereunder may be canceled at, or
at any time prior to, the Closing Date by the Representatives. Notice
of such cancellation shall be given to the Company in writing or by
telephone or facsimile confirmed in writing.

The documents required to be delivered by this Section 6 shall be
delivered at the office of Mayer, Brown & Platt, counsel for the
Underwriters, at 190 S. LaSalle Street, Chicago, Illinois, on the
Closing Date.

<PAGE> 45

7. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the sale of the
Securities provided for herein is not consummated because any
condition to the obligations of the Underwriters set forth in
Section 6 hereof is not satisfied, because of any termination pursuant
to Section 10 hereof or because of any refusal, inability or failure
on the part of the Company to perform any agreement herein or comply
with any provision hereof other than by reason of a default by any of
the Underwriters, the Company will reimburse the Underwriters
severally through Salomon Brothers Inc on demand for all out-of-pocket
expenses (including reasonable fees and disbursements of counsel) that
shall have been incurred by them in connection with the proposed
purchase and sale of the Securities.

8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company agrees to
indemnify and hold harmless each Underwriter, the directors, officers,
employees and agents of each Underwriter and each person who controls
any Underwriter within the meaning of either the Act or the Exchange
Act against any and all losses, claims, damages or liabilities, joint
or several, to which they or any of them may become subject under the
Act, the Exchange Act or other Federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the registration statement
for the registration of the Securities as originally filed or in any
amendment thereof, or in any Basic Prospectus, Preliminary Final
Prospectus or the Final Prospectus, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and agrees to reimburse each such indemnified party, as
incurred, for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim,
damage, liability or action; PROVIDED, HOWEVER, that the Company will
not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any
Underwriter through the Representatives specifically for inclusion
therein. This indemnity agreement will be in addition to any
liability which the Company may otherwise have.

(b) Each Underwriter severally and not jointly agrees to
indemnify and hold harmless the Company, each of its directors, each
of its officers who signs the Registration Statement, and each person
who controls the Company within the meaning of either the Act or the
Exchange Act, to the same extent as the foregoing indemnity to each
Underwriter, but only with reference to written information relating
to such Underwriter furnished to the Company by or on behalf of such
Underwriter through the Representatives specifically for inclusion in
the documents referred to in the foregoing indemnity. This indemnity
agreement will be in addition to any liability which any Underwriter

<PAGE> 46

may otherwise have. The Company acknowledges that the statements set
forth [in the last paragraph of the cover page regarding delivery of
the Securities][the legend in block capital letters on page [2]
related to stabilization, syndicate covering transactions and penalty
bids][under the heading "Underwriting" or "Plan of Distribution", (i)
the sentences related to concessions and reallowances and (ii) the
paragraph related to stabilization, syndicate covering transactions
and penalty bids] in any Preliminary Final Prospectus and the Final
Prospectus constitute the only information furnished in writing by or
on behalf of the several Underwriters for inclusion in any Preliminary
Final Prospectus or the Final Prospectus.

(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made
against the indemnifying party under this Section 8, notify the
indemnifying party in writing of the commencement thereof; but the
failure so to notify the indemnifying party (i) will not relieve it
from liability under paragraph (a) or (b) above unless and to the
extent it did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantial
rights and defenses and (ii) will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other
than the indemnification obligation provided in paragraph (a) or (b)
above. The indemnifying party shall be entitled to appoint counsel of
the indemnifying party's choice at the indemnifying party's expense to
represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall
not thereafter be responsible for the fees and expenses of any
separate counsel retained by the indemnified party or parties except
as set forth below); PROVIDED, HOWEVER, that such counsel shall be
satisfactory to the indemnified party. Notwithstanding the
indemnifying party's election to appoint counsel to represent the
indemnified party in an action, the indemnified party shall have the
right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses
of such separate counsel if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present
such counsel with a conflict of interest, (ii) the actual or potential
defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there may be legal defenses
available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii)
the indemnifying party shall not have employed counsel satisfactory to
the indemnified party to represent the indemnified party within a
reasonable time after notice of the institution of such action or (iv)
the indemnifying party shall authorize the indemnified party to employ
separate counsel at the expense of the indemnifying party. An
indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of
any judgment with respect to any pending or threatened claim, action,
suit or proceeding in respect of which indemnification or contribution

<PAGE> 47

may be sought hereunder (whether or not the indemnified parties are
actual or potential parties to such claim or action) unless such
settlement, compromise or consent includes an unconditional release of
each indemnified party from all liability arising out of such claim,
action, suit or proceeding.

(d) In the event that the indemnity provided in paragraph (a) or
(b) of this Section 8 is unavailable to or insufficient to hold
harmless an indemnified party for any reason, the Company and the
Underwriters severally agree to contribute to the aggregate losses,
claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending
same) (collectively "Losses") to which the Company and one or more of
the Underwriters may be subject in such proportion as is appropriate
to reflect the relative benefits received by the Company on the one
hand and by the Underwriters on the other from the offering of the
Securities; PROVIDED, HOWEVER, that in no case shall any Underwriter
(except as may be provided in any agreement among underwriters
relating to the offering of the Securities) be responsible for any
amount in excess of the underwriting discount or commission applicable
to the Securities purchased by such Underwriter hereunder. If the
allocation provided by the immediately preceding sentence is
unavailable for any reason, the Company and the Underwriters severally
shall contribute in such proportion as is appropriate to reflect not
only such relative benefits but also the relative fault of the Company
and of the Underwriters in connection with the statements or omissions
which resulted in such Losses as well as any other relevant equitable
considerations. Benefits received by the Company shall be deemed to
be equal to the total net proceeds from the offering (before deducting
expenses) received by it, and benefits received by the Underwriters
shall be deemed to be equal to the total underwriting discounts and
commissions, in each case as set forth on the cover page of the Final
Prospectus. Relative fault shall be determined by reference to, among
other things, whether any untrue or any alleged untrue statement of a
material fact or the omission or alleged omission to state a material
fact relates to information provided by the Company on the one hand or
the Underwriters on the other, the intent of the parties and their
relative knowledge, access to information and opportunity to correct
or prevent such untrue statement or omission. The Company and the
Underwriters agree that it would not be just and equitable if
contribution were determined by pro rata allocation or any other
method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of
this paragraph (d), no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 8, each person who
controls an Underwriter within the meaning of either the Act or the
Exchange Act and each director, officer, employee and agent of an
Underwriter shall have the same rights to contribution as such
Underwriter, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, each officer of the
Company who shall have signed the Registration Statement and each

<PAGE> 48

director of the Company shall have the same rights to contribution as
the Company, subject in each case to the applicable terms and
conditions of this paragraph (d).

9. DEFAULT BY AN UNDERWRITER. If any one or more Underwriters
shall fail to purchase and pay for any of the Securities agreed to be
purchased by such Underwriter or Underwriters hereunder and such
failure to purchase shall constitute a default in the performance of
its or their obligations under this Agreement, the remaining
Underwriters shall be obligated severally to take up and pay for (in
the respective proportions which the principal amount of Securities
set forth opposite their names in Schedule II hereto bears to the
aggregate principal amount of Securities set forth opposite the names
of all the remaining Underwriters) the Securities which the defaulting
Underwriter or Underwriters agreed but failed to purchase; PROVIDED,
HOWEVER, that in the event that the aggregate principal amount of
Securities which the defaulting Underwriter or Underwriters agreed but
failed to purchase shall exceed 10% of the aggregate principal amount
of Securities set forth in Schedule II hereto, the remaining
Underwriters shall have the right to purchase all, but shall not be
under any obligation to purchase any, of the Securities, and if such
nondefaulting Underwriters do not purchase all the Securities, this
Agreement will terminate without liability to any nondefaulting
Underwriter or the Company. In the event of a default by any
Underwriter as set forth in this Section 9, the Closing Date shall be
postponed for such period, not exceeding five business days, as the
Representatives shall determine in order that the required changes in
the Registration Statement and the Final Prospectus or in any other
documents or arrangements may be effected. Nothing contained in this
Agreement shall relieve any defaulting Underwriter of its liability,
if any, to the Company and any nondefaulting Underwriter for damages
occasioned by its default hereunder.

10. TERMINATION. This Agreement shall be subject to termination
in the absolute discretion of the Representatives, by notice given to
the Company prior to delivery of and payment for the Securities, if at
any time prior to such time (i) trading in the Company's Common Stock
shall have been suspended by the Commission or the New York Stock
Exchange or trading in securities generally on the New York Stock
Exchange, the American Stock Exchange or the Nasdaq Stock Market shall
have been suspended or limited or minimum prices shall have been
established on either of such Exchanges or the Nasdaq Stock Market,
(ii) a banking moratorium shall have been declared either by Federal
or New York State authorities or (iii) there shall have occurred any
outbreak or escalation of hostilities, declaration by the United
States of a national emergency or war or other calamity or crisis the
effect of which on financial markets is such as to make it, in the
sole judgment of the Representatives, impractical or inadvisable to
proceed with the offering or delivery of the Securities as
contemplated by the Final Prospectus (exclusive of any supplement
thereto).

<PAGE> 49

11. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The respective
agreements, representations, warranties, indemnities and other
statements of the Company or its officers and of the Underwriters set
forth in or made pursuant to this Agreement will remain in full force
and effect, regardless of any investigation made by or on behalf of
any Underwriter or the Company or any of the officers, directors or
controlling persons referred to in Section 8 hereof, and will survive
delivery of and payment for the Securities. The provisions of
Sections 7 and 8 hereof shall survive the termination or cancellation
of this Agreement.

12. NOTICES. All communications hereunder will be in writing
and effective only on receipt, and, if sent to the Representatives,
will be mailed, delivered or telefaxed to the Salomon Brothers Inc
General Counsel (fax no.: (212)_______________________) and confirmed
to the General Counsel, Salomon Brothers Inc, at
, New York, New York, 10013, Attention: General Counsel; or, if
sent to the Company, will be mailed, delivered or telefaxed to 100
North Riverside Plaza, Chicago, Illinois 60606-1596, Attention :
(fax no. (312) ___-____) and confirmed to it at 100 North Riverside
Plaza, Chicago, Illinois 60606-1596, attention of General Counsel.

13. SUCCESSORS. This Agreement will inure to the benefit of and
be binding upon the parties hereto and their respective successors and
the officers and directors and controlling persons referred to in
Section 8 hereof, and no other person will have any right or
obligation hereunder.

14. APPLICABLE LAW. This Agreement will be governed by and
construed in accordance with the laws of the State of New York
applicable to contracts made and to be performed within the State of
New York.

15. COUNTERPARTS. This Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of
which together shall constitute one and the same agreement.

16. HEADINGS. The section headings used herein are for
convenience only and shall not affect the construction hereof.

<PAGE> 50

If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding
agreement among the Company and the several Underwriters.

Very truly yours,

MORTON INTERNATIONAL, INC.

By:________________________________
Name:
Title:

The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.

SALOMON BROTHERS INC
BANCAMERICA ROBERTSON STEPHENS
FIRST CHICAGO CAPITAL MARKETS, INC.

BY: SALOMON BROTHERS INC

By: ________________________________________
Name:
Title:

For themselves and the other several
Underwriters named in Schedule I
to the foregoing Agreement.

<PAGE> 51

SCHEDULE I

Underwriting Agreement dated

Registration Statement No.

Representative(s): Salomon Brothers Inc
BancAmerica Robertson Stephens
First Chicago Capital Markets, Inc.

Closing date and time:

Place for delivery:

Description of Securities:

Title:

Specified Currency:

Aggregate principal amount:

Stated maturity date:

Purchase price (include accrued interest or amortization, if
any):

Sinking fund provisions:

Redemption provisions:

Other provisions:

Defeasance Provisions:

Interest Payment Dates:

Form of Certificates:

Depositary:

Trading System:

Method of Payment:

Stock exchange listing, if any:

Delayed Delivery arrangements:

Additional procedures to be performed by Ernst & Young LLP, if any:

<PAGE> 52

SCHEDULE II

Principal
Amount
Underwriter of Securities
---------- -------------

Salomon Brothers Inc . . . . . . . . . $

BancAmerica Robertson Stephens . . . .
First Chicago Capital Markets, Inc. . .

-----------
Total . . . . . . . . . . . . . . $
===========

<PAGE> 53

SCHEDULE III

DELAYED DELIVERY CONTRACT

Morton International, Inc.
c/o (Name and address of appropriate
Representative)
,

Attention:

Dear Sirs:

The undersigned hereby agrees to purchase from Morton
International, Inc. (hereinafter called the "Company"), and the
Company agrees to sell to the undersigned, $
principal amount of the Company's [Title of Debt Securities]
(hereinafter called the "Securities"), offered by the Company's
Prospectus dated , , and Prospectus Supplement
dated , , receipt of a copy of which is hereby
acknowledged, at a purchase price of percent of the principal
amount thereof, plus accrued interest from the date from which
interest accrues as set forth below, and on the further terms and
conditions set forth in this contract.

The undersigned will purchase the Securities from the Company on
, (the "Delivery Date") and interest on the Securities so
purchased will accrue from , .

The undersigned will purchase the Securities from the Company on
the delivery date or dates and in the principal amount or amounts and
number or numbers set forth below:

Date from Which
Delivery Date Principal Amount Interest Accrues
------------- ---------------- ----------------

, $ ,

Each such date on which Securities are to be purchased hereunder
is hereinafter referred to as a "Delivery Date".

Payment for the Securities which the undersigned has agreed to
purchase on a Delivery Date shall be made to the Company or its order
by certified or official bank check in funds at
the office of , or by wire transfer to a bank account
specified by the Company, on such Delivery Date upon delivery to the
undersigned of the Securities then to be purchased by the undersigned
in either (i) definitive fully registered form and in such
denominations and registered in such names as the undersigned may

<PAGE> 54

designate by written or telegraphic communication addressed to the
Company not less than five full business days prior to such Delivery
Date (alternative provision) or (ii) book-entry form for deposit with
The Depository Trust Company.

The obligation of the undersigned to take delivery of and make
payment for Securities on a Delivery Date shall be subject to the
condition that the purchase of Securities to be made by the
undersigned shall not on such Delivery Date be prohibited under the
laws of the jurisdiction to which the undersigned is subject. The
obligation of the undersigned to take delivery of and make payment for
Securities shall not be affected by the failure of any purchaser to
take delivery of and make payment for Securities pursuant to other
contracts similar to this contract.

[The undersigned understands that underwriters (the
"Underwriters") are also purchasing Securities from the Company, but
that the obligations of the undersigned hereunder are not contingent
on such purchases. Promptly after completion of the sale to the
Underwriters the Company will mail or deliver to the undersigned at
its address set forth below notice to such effect, accompanied by a
copy of the opinion of counsel for the Company delivered to the
Underwriters in connection therewith.]

The undersigned represents and warrants that, as of the date of
this contract, the undersigned is not prohibited from purchasing the
Securities hereby agreed to be purchased by it under the laws of the
jurisdiction to which the undersigned is subject.

This contract will inure to the benefit of and be binding upon
the parties hereto and their respective successors, but will not be
assignable by either party hereto without the written consent of the
other.

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

It is understood that the acceptance by the Company of any
Delayed Delivery Contract (including this contract) is in the
Company's sole discretion and that, without limiting the foregoing,
acceptances of such contracts need not be on a first-come, first-
served basis. If this contract is acceptable to the Company, it is
requested that the Company sign the form of acceptance below and mail

<PAGE> 55

or deliver one of the counterparts hereof to the undersigned at its
address set forth below. This will become a binding contract between
the Company and the undersigned when such counterpart is so mailed or
delivered by the Company.

Yours very truly,

By____________________________
(Signature)

______________________________
(Name and Title)

______________________________
(Address)

Accepted:___________________, 19 ______

MORTON INTERNATIONAL, INC.

By___________________________________
(Title)

EXHIBIT 4.1

FORM OF INDENTURE

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

MORTON INTERNATIONAL, INC.,
AS ISSUER

AND

THE FIRST NATIONAL BANK OF CHICAGO,
AS TRUSTEE

___________

INDENTURE

Dated as of ____________, 1998

___________

DEBT SECURITIES

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

<PAGE> 57

TABLE OF CONTENTS<1>

Page
----
Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Recitals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63

ARTICLE ONE. DEFINITIONS. . . . . . . . . . . . . . . . . . . . . 63
SECTION 1.01. Definitions . . . . . . . . . . . . . . . . . . . . 63
Affiliate . . . . . . . . . . . . . . . . . . . . . 64
Appropriate Officers . . . . . . . . . . . . . . . . 64
Authenticating Agent . . . . . . . . . . . . . . . . 64
Board of Directors . . . . . . . . . . . . . . . . . 64
Board Resolution . . . . . . . . . . . . . . . . . . 64
Business Day . . . . . . . . . . . . . . . . . . . . 64
Capitalized Rent . . . . . . . . . . . . . . . . . . 65
Commission . . . . . . . . . . . . . . . . . . . . . 65
Company . . . . . . . . . . . . . . . . . . . . . . 65
Company Request and Company Order . . . . . . . . . 65
Consolidated Net Tangible Assets . . . . . . . . . . 65
Currency Determination Agent . . . . . . . . . . . . 66
Debt Security or Debt Securities . . . . . . . . . . 66
Debt Security Register . . . . . . . . . . . . . . . 66
Depository . . . . . . . . . . . . . . . . . . . . . 66
Dollar . . . . . . . . . . . . . . . . . . . . . . . 67
Event of Default . . . . . . . . . . . . . . . . . . 67
Foreign Currency . . . . . . . . . . . . . . . . . . 67
Funded Debt . . . . . . . . . . . . . . . . . . . . 67
Global Debt Security . . . . . . . . . . . . . . . . 67
Government Obligations . . . . . . . . . . . . . . . 67
Holder . . . . . . . . . . . . . . . . . . . . . . . 68
Indenture . . . . . . . . . . . . . . . . . . . . . 68
Indexed Debt Security: . . . . . . . . . . . . . . . 68
Interest . . . . . . . . . . . . . . . . . . . . . . 68
Interest Payment Date . . . . . . . . . . . . . . . 68
Market Exchange Rate . . . . . . . . . . . . . . . . 68
Officers' Certificate . . . . . . . . . . . . . . . 69
Opinion of Counsel . . . . . . . . . . . . . . . . . 69
Original Issue Discount Debt Security . . . . . . . 69
Outstanding . . . . . . . . . . . . . . . . . . . . 69
Paying Agent . . . . . . . . . . . . . . . . . . . . 70
Person . . . . . . . . . . . . . . . . . . . . . . . 71
Place of Payment . . . . . . . . . . . . . . . . . . 71
Predecessor Debt Security . . . . . . . . . . . . . 71
Principal Office of the Trustee . . . . . . . . . . 71
Principal Property . . . . . . . . . . . . . . . . . 71
Redemption Date . . . . . . . . . . . . . . . . . . 71
Redemption Price . . . . . . . . . . . . . . . . . . 72
Regular Record Date . . . . . . . . . . . . . . . . 72

<1>This table of contents shall not, for any purpose, be deemed to be
a part of the Indenture.

<PAGE> 58
Page
____

Responsible Officer . . . . . . . . . . . . . . . . 72
Restricted Subsidiary . . . . . . . . . . . . . . . 72
Secured Debt . . . . . . . . . . . . . . . . . . . . 73
Security Interest . . . . . . . . . . . . . . . . . 73
Senior Officer . . . . . . . . . . . . . . . . . . . 73
Special Record Date . . . . . . . . . . . . . . . . 73
Stated Maturity . . . . . . . . . . . . . . . . . . 73
Subsidiary . . . . . . . . . . . . . . . . . . . . . 73
Trustee . . . . . . . . . . . . . . . . . . . . . . 74
Trust Indenture Act of 1939 . . . . . . . . . . . . 74
Unrestricted Subsidiary . . . . . . . . . . . . . . 74

ARTICLE TWO. DEBT SECURITY FORMS. . . . . . . . . . . . . . . . . 74
SECTION 2.01. Forms Generally . . . . . . . . . . . . . . . . . . 74
SECTION 2.02. Forms of Debt Securities . . . . . . . . . . . . . . 75
SECTION 2.03. Form of Trustee's Certificate of Authentication . . 75
SECTION 2.04. Debt Securities in Global Form . . . . . . . . . . . 75

ARTICLE THREE. THE DEBT SECURITIES. . . . . . . . . . . . . . . . 78
SECTION 3.01. Amount Unlimited; Title and Terms . . . . . . . . . 78
SECTION 3.02. Denominations; Registered Form . . . . . . . . . . . 80
SECTION 3.03. Payment of Principal and Interest . . . . . . . . . 81
SECTION 3.04. Execution of Debt Securities . . . . . . . . . . . . 81
SECTION 3.05. Temporary Debt Securities . . . . . . . . . . . . . 83
SECTION 3.06. Exchange and Registration of Transfer of Debt
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
SECTION 3.07. Mutilated, Destroyed, Lost or Stolen Debt Securities 85
SECTION 3.08. Payment of Interest; Interest Rights Preserved . . . 86
SECTION 3.09. Persons Deemed Owners . . . . . . . . . . . . . . . 88
SECTION 3.10. Cancellation of Debt Securities Paid, Etc . . . . . 88
SECTION 3.11. Debt Securities in Foreign Currencies . . . . . . . 88

ARTICLE FOUR. REDEMPTION OF DEBT SECURITIES; SINKING FUNDS. . . . 89
SECTION 4.01. Applicability of Article . . . . . . . . . . . . . . 89
SECTION 4.02. Notice of Redemption; Selection of Debt Securities . 89
SECTION 4.03. Payment of Debt Securities Called for Redemption . . 91
SECTION 4.04. Exclusion of Certain Securities from
Eligibility for Selection for Redemption . . . 91
SECTION 4.05. Provisions with Respect to any Sinking Funds . . . . 92

ARTICLE FIVE. PARTICULAR COVENANTS OF THE COMPANY. . . . . . . . . 93
SECTION 5.01. Payment of Principal, Premium and Interest . . . . . 93
SECTION 5.02. Offices for Notices and Payments, Etc . . . . . . . 94
SECTION 5.03. Appointments to Fill Vacancies in Trustee's Office . 94
SECTION 5.04. Provisions as to Paying Agent . . . . . . . . . . . 94
SECTION 5.05. Limitation on Secured Debt . . . . . . . . . . . . . 95
SECTION 5.06. Sale and Leaseback Transactions . . . . . . . . . . 98
SECTION 5.07. Certificate to Trustee . . . . . . . . . . . . . . . 99
SECTION 5.08. Waivers of Covenants . . . . . . . . . . . . . . . . 99

ARTICLE SIX. HOLDERS' LISTS AND REPORTS BY THE COMPANY
AND THE TRUSTEE. . . . . . . . . . . . . . . . . . . 100

<PAGE> 59

Page
____

SECTION 6.01. Holders' Lists . . . . . . . . . . . . . . . . . . . 100
SECTION 6.02. Preservation and Disclosure of Lists . . . . . . . . 100
SECTION 6.03. Reports by the Company . . . . . . . . . . . . . . . 100
SECTION 6.04. Reports by the Trustee . . . . . . . . . . . . . . . 101

ARTICLE SEVEN. REMEDIES OF THE TRUSTEE AND HOLDERS
ON EVENT OF DEFAULT. . . . . . . . . . . . . . . . . 101
SECTION 7.01. Events of Default . . . . . . . . . . . . . . . . . 101
SECTION 7.02. Payment of Debt Securities Upon Default; Suit Therefor
104
SECTION 7.03. Application of Moneys Collected by Trustee . . . . . 106
SECTION 7.04. Proceedings by Holders . . . . . . . . . . . . . . . 107
SECTION 7.05. Proceedings by Trustee . . . . . . . . . . . . . . . 108
SECTION 7.06. Remedies Cumulative and Continuing . . . . . . . . . 108
SECTION 7.07. Direction of Proceedings and Waiver
of Defaults by Majority of Holders . . . . . . 109
SECTION 7.08. Notice of Defaults . . . . . . . . . . . . . . . . . 109
SECTION 7.09. Undertaking to Pay Costs . . . . . . . . . . . . . . 110
SECTION 7.10. Unconditional Right of Holders to
Receive Principal, Premium and Interest . . . 110

ARTICLE EIGHT. CONCERNING THE TRUSTEE. . . . . . . . . . . . . . . 110
SECTION 8.01. Duties and Responsibilities of Trustee . . . . . . . 110
SECTION 8.02. Reliance on Documents, Opinions, Etc. . . . . . . . 111
SECTION 8.03. No Responsibility for Recitals, Etc. . . . . . . . . 112
SECTION 8.04. Trustee and Agents May Own Debt Securities . . . . . 112
SECTION 8.05. Moneys to be Held in Trust . . . . . . . . . . . . . 113
SECTION 8.06. Compensation and Expenses of Trustee . . . . . . . . 113
SECTION 8.07. Officers' Certificate as Evidence . . . . . . . . . 113
SECTION 8.08. Conflicting Interest of Trustee . . . . . . . . . . 114
SECTION 8.09. Eligibility of Trustee . . . . . . . . . . . . . . . 114
SECTION 8.10. Resignation or Removal of Trustee . . . . . . . . . 114
SECTION 8.11. Acceptance by Successor Trustee . . . . . . . . . . 116
SECTION 8.12. Succession by Merger, Etc. . . . . . . . . . . . . . 117
SECTION 8.13. Limitation on Rights of Trustee as a Creditor . . . 117
SECTION 8.14. Authenticating Agents . . . . . . . . . . . . . . . 118

ARTICLE NINE. CONCERNING THE HOLDERS. . . . . . . . . . . . . . . 121
SECTION 9.01. Action by Holders . . . . . . . . . . . . . . . . . 121
SECTION 9.02. Proof of Execution by Holders . . . . . . . . . . . 121
SECTION 9.03. Who Are Deemed Absolute Owners . . . . . . . . . . . 121
SECTION 9.04. Company-Owned Debt Securities Disregarded . . . . . 121
SECTION 9.05. Revocation of Consents; Future Holders Bound . . . . 122

ARTICLE TEN. HOLDERS' MEETINGS. . . . . . . . . . . . . . . . . . 123
SECTION 10.01. Purposes of Meetings . . . . . . . . . . . . . . . . 123
SECTION 10.02. Call of Meetings by Trustee . . . . . . . . . . . . 123
SECTION 10.03. Call of Meetings by Company or Holders . . . . . . . 123
SECTION 10.04. Qualifications for Voting; Record Dates . . . . . . 124
SECTION 10.05. Regulations . . . . . . . . . . . . . . . . . . . . 124
SECTION 10.06. Voting . . . . . . . . . . . . . . . . . . . . . . . 125
SECTION 10.07. No Delay of Rights by Meeting . . . . . . . . . . . 126

<PAGE> 60
Page
____

ARTICLE ELEVEN. SUPPLEMENTAL INDENTURES. . . . . . . . . . . . . . 126
SECTION 11.01 Supplemental Indentures without Consent of Holders . 126
SECTION 11.02. Supplemental Indentures with Consent of Holders . . 128
SECTION 11.03. Effect of Supplemental Indentures . . . . . . . . . 129
SECTION 11.04. Notation on Debt Securities . . . . . . . . . . . . 129
SECTION 11.05. Evidence of Compliance of Supplemental Indenture
to be Furnished Trustee . . . . . . . . . . . . 129

ARTICLE TWELVE. CONSOLIDATION, MERGER, SALE AND CONVEYANCE. . . . 129
SECTION 12.01. Company May Consolidate, Etc., on Certain Terms. . . 129
SECTION 12.02. Successor Corporation to be Substituted . . . . . . 130
SECTION 12.03. Opinion of Counsel to Be Given Trustee . . . . . . . 131

ARTICLE THIRTEEN. SATISFACTION AND DISCHARGE OF INDENTURE. . . . 131
SECTION 13.01. Satisfaction, Discharge and Defeasance
of Debt Securities of any Series . . . . . . . 131
SECTION 13.02. Defeasance of Debt Securities of any Series . . . . 133
SECTION 13.03. Application of Trust Funds; Indemnification . . . . 134
SECTION 13.04. Return of Unclaimed Moneys . . . . . . . . . . . . . 135

ARTICLE FOURTEEN. IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS. . . . . . . . . . . . . 135
SECTION 14.01. Indenture and Debt Securities Solely Corporate
Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135

ARTICLE FIFTEEN. MISCELLANEOUS PROVISIONS. . . . . . . . . . . . . 136
SECTION 15.01. Provisions Binding on Successors of the Company . . 136
SECTION 15.02. Indenture for Sole Benefit of Parties and Holders of
Debt Securities . . . . . . . . . . . . . . . . . . . . . . . . . . 136
SECTION 15.03. Addresses for Notices, Etc. . . . . . . . . . . . . 136
SECTION 15.04. Governing Law . . . . . . . . . . . . . . . . . . . 137
SECTION 15.05. Evidence of Compliance with Conditions Precedent . . 137
SECTION 15.06. Legal Holidays . . . . . . . . . . . . . . . . . . . 138
SECTION 15.07. Trust Indenture Act of 1939 to Control . . . . . . . 138
SECTION 15.08. Table of Contents, Headings, Etc. . . . . . . . . . 138
SECTION 15.09. Determination of Principal Amount . . . . . . . . . 138
SECTION 15.10. Execution in Counterparts; Acceptance of Trusts . . 139

Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140
Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . 141

<PAGE> 61

CROSS REFERENCE SHEET

BETWEEN

Provisions of Sections 310 through 318(a) inclusive of Trust
Indenture Act of 1939 and the Indenture dated as of ____________, 1998
between Morton International, Inc. and The First National Bank of
Chicago, as Trustee.

SECTION OF ACT SECTION OF INDENTURE
-------------- --------------------
310(a)(1) and (2) . . . . . . . . . . . . . 8.09
310(a)(3) and (4) . . . . . . . . . . . . . *
310(b) . . . . . . . . . . . . . . . . . . 8.08 and 8.10

310(c) . . . . . . . . . . . . . . . . . . *
311(a) . . . . . . . . . . . . . . . . . . 8.13(a)
311(b) . . . . . . . . . . . . . . . . . . 8.13(b)
311(c) . . . . . . . . . . . . . . . . . . *
312(a) . . . . . . . . . . . . . . . . . . 6.01 and 6.02(a)

312(b) . . . . . . . . . . . . . . . . . . 6.02(b)
312(c) . . . . . . . . . . . . . . . . . . 6.02(c)
313(a)(1), (2), (3), (4), (6) and (7) . . . 6.04(a)(1-6)
313(a)(5) . . . . . . . . . . . . . . . . . *

313(b)(1) . . . . . . . . . . . . . . . . . *
313(b)(2) . . . . . . . . . . . . . . . . . 6.04(b)
313(c) . . . . . . . . . . . . . . . . . . 6.04(c)
313(d) . . . . . . . . . . . . . . . . . . 6.04(d)

314(a)(1) . . . . . . . . . . . . . . . . . 6.03(a)
314(a)(2) . . . . . . . . . . . . . . . . . 6.03(b)
314(a)(3) . . . . . . . . . . . . . . . . . 6.03(c)
314(b) . . . . . . . . . . . . . . . . . . *

314(c)(1) . . . . . . . . . . . . . . . . . 15.05
314(c)(2) . . . . . . . . . . . . . . . . . 15.05
314(c)(3) . . . . . . . . . . . . . . . . . *
314(d) . . . . . . . . . . . . . . . . . . *

314(e) . . . . . . . . . . . . . . . . . . 15.05
314(f) . . . . . . . . . . . . . . . . . . *
315(a), (c) and (d) . . . . . . . . . . . . 8.01
315(b) . . . . . . . . . . . . . . . . . . 7.08

315(e) . . . . . . . . . . . . . . . . . . 7.09
316(a)(1) . . . . . . . . . . . . . . . . . 7.07
316(a)(2) . . . . . . . . . . . . . . . . . *
316(a) last para 9.04
316(b) . . . . . . . . . . . . . . . . . . 7.10

<PAGE> 62

317(a) . . . . . . . . . . . . . . . . . . 7.02
317(b) . . . . . . . . . . . . . . . . . . 5.04
318(a) . . . . . . . . . . . . . . . . . . 15.07

_____________________
* Not applicable.

** This cross reference sheet shall not, for any purpose, be deemed
to be part of the Indenture.

<PAGE> 63

THIS INDENTURE, dated as of ____________, 1998, is made by
and between Morton International, Inc., an Indiana corporation (the
"Company"), and The First National Bank of Chicago, a national banking
association, as trustee (the "Trustee").

RECITALS OF THE COMPANY

The Company has duly authorized the execution and delivery
of this Indenture to provide for the issue from time to time of its
unsecured debentures, notes, bonds or other evidences of indebtedness
to be issued in one or more series as in this Indenture provided, up
to such principal amount or amounts as may from time to time be
authorized in or pursuant to one or more resolutions of the Board of
Directors.

All things necessary to make this Indenture a valid
agreement of the Company, in accordance with its terms, have been
done.

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

For and in consideration of the premises and the purchase or
acceptance of the Debt Securities by the Holders thereof, it is
mutually covenanted and agreed, for the equal and proportionate
benefit of the respective Holders from time to time of the Debt
Securities or of any series thereof as follows:

ARTICLE ONE.

DEFINITIONS.

SECTION 1.01. DEFINITIONS. The terms defined in this
Section 1.01 (except as herein otherwise expressly provided or unless
the context otherwise requires) for all purposes of this Indenture and
of any indenture supplemental hereto shall have the respective
meanings specified in this Section 1.01. All other terms used in this
Indenture which are defined in the Trust Indenture Act of 1939 or
which are by reference therein defined in the Securities Act of 1933,
as amended, shall have (except as herein otherwise expressly provided
or unless the context otherwise requires) the meanings assigned to
such terms in said Trust Indenture Act of 1939 and in said Securities
Act as in force at the date of the execution of this Indenture. All
accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting
principles and, except as otherwise herein expressly provided, the
term "generally accepted 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.
All references to such terms herein shall be both to the singular or
the plural, as the context so requires.

<PAGE> 64

Affiliate:
---------

The term "Affiliate", when used with respect to 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.

Appropriate Officers:
--------------------

The term "Appropriate Officers" means any Senior Officer
together with any one of the Secretary, any Assistant Secretary or any
Assistant Treasurer of the Company.

Authenticating Agent:
--------------------

The term "Authenticating Agent" means the agent of the
Trustee, if any, which at the time shall be appointed and acting
pursuant to Section 8.14.

Board of Directors:
------------------

The term "Board of Directors" means the Board of Directors
of the Company or any authorized committee of such Board designated by
such Board or the by-laws or articles of incorporation of the Company
to act for such Board for purposes including transactions contemplated
by this Indenture.

Board Resolution:
----------------

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

Business Day:
------------

The term "Business Day", when used with respect to any Place
of Payment, means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in that Place of
Payment are authorized or obligated by law to close.

<PAGE> 65

Capitalized Rent:
----------------

The term "Capitalized Rent" means the total net amount of
rent payable for the remaining term as of the date of determination
thereof under a lease of Principal Property by the Company or any of
its Restricted Subsidiaries, discounted from the respective due dates
thereof to such date of determination at the rate of 10% per annum
compounded annually. The total net amount of rent payable under any
such lease for any period shall be the total amount of the rent
payable by the lessee with respect to such period but shall not
include amounts required to be paid on account of maintenance and
repairs, insurance, taxes, assessments, water rates, sewer rents and
similar charges and contingent rents such as those based on sales.
The remaining term under any lease shall be calculated without giving
effect to any unexercised option of the lessee for the renewal or
extension of any term.

Commission:
----------

The term "Commission" means the Securities and Exchange
Commission, as constituted from time to time, created under the
Securities Exchange Act of 1934, 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.

Company:
-------

The term "Company" means Morton International, Inc., an
Indiana corporation, and, subject to Article Twelve, shall include its
successors and assigns.

Company Request and Company Order:
---------------------------------

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

Consolidated Net Tangible Assets:
--------------------------------

"Consolidated Net Tangible Assets" means the total of all
the assets appearing on the consolidated balance sheet of the Company
and its Restricted Subsidiaries, less the following:

(1) current liabilities, including
liabilities for indebtedness maturing more than 12
months from the date of the original creation
thereof but maturing within 12 months from the

<PAGE> 66

date of determination but excluding any current
liabilities constituting Funded Debt by reason of
being renewable or extendable and current deferred
income taxes;

(2) reserves for depreciation and other asset
valuation reserves;

(3) intangible assets, including, but
without limitation, such items as goodwill,
trademarks, trade names, patents and unamortized
debt discount and expense carried as an asset on
said balance sheet;

(4) appropriate adjustments on account of
minority interests of other Persons holding stock
in any Restricted Subsidiary of the Company; and

(5) the value of assets of or investments in
Unrestricted Subsidiaries.

Currency Determination Agent:
----------------------------

The term "Currency Determination Agent" means the financial
institution, if any, from time to time selected by the Company and
approved by the Trustee to serve as a Currency Determination Agent to
serve as a Currency Determination Agent for purposes of Section 3.11.

Debt Security or Debt Securities:
--------------------------------

The terms "Debt Security" or "Debt Securities" mean any
unsecured notes, debentures or other indebtedness of any series, as
the case may be, issued by the Company from time to time, and
authenticated and delivered under this Indenture.

Debt Security Register:
----------------------

The term "Debt Security Register" shall have the meaning set
forth in Section 3.06.

Depository:
----------

The term "Depository" shall mean, unless otherwise specified
by the Company pursuant to Section 3.01, with respect to Securities of

<PAGE> 67

any series issuable or issued as a Global Debt Security, The
Depository Trust Company, New York, New York, or any successor thereto
registered as a clearing agency pursuant to the provisions of Section
17A of the Securities Exchange Act of 1934, as amended, or other
applicable statute or regulation.

Dollar:
------

The terms "Dollar" mean the coin or currency of the United
States of America which as of the time of payment is legal tender for
the payment of public and private debts.

Event of Default:
----------------

The term "Event of Default" means any event specified in
Section 7.01, continued for the period of time, if any, and after the
giving of the notice, if any, therein designated.

Foreign Currency:
----------------

The term "Foreign Currency" means a currency issued by the
government of any country other than the United States of America.

Funded Debt:
-----------

The term "Funded Debt" means all indebtedness for money
borrowed having a maturity of more than twelve months from the date of
the most recent consolidated balance sheet of the Company and its
Restricted Subsidiaries (excluding indebtedness of Unrestricted
Subsidiaries) or renewable and extendible beyond twelve months at the
option of the borrower and all obligations in respect of lease rentals
which under generally accepted accounting principles would be shown on
a consolidated balance sheet of the Company as a liability item other
than a current liability; provided, however, that Funded Debt shall
not include any of the foregoing to the extent that such indebtedness
or obligations are not required by generally accepted accounting
principles to be shown on the balance sheet of the Company.

Global Debt Security:
--------------------

The term "Global Debt Security" means a Debt Security issued
to evidence all or part of a series of Debt Securities.

Government Obligations:
----------------------

The term "Government Obligations" means securities which are
(i) direct obligations of the government which issued the currency in

<PAGE> 68

which the Debt Securities of a series are denominated or (ii)
obligations of a person controlled or supervised by and acting as an
agency or instrumentality of the government which issued the currency
in which the Debt Securities of such series are denominated, the
payment of which obligations is unconditionally guaranteed by such
government, and which, in either case, are full faith and credit
obligations of such government, are denominated in the currency in
which the Debt Securities of such series are denominated and which are
not callable or redeemable at the option of the issuer thereof.

Holder:
------

The term "Holder" means any Person in whose name a Debt
Security of any series is registered in the Debt Security Register
applicable to Debt Securities of such series.

Indenture:
---------

The term "Indenture" means this instrument as originally
executed or, if amended or supplemented as herein provided, as so
amended or supplemented, pursuant to the applicable provisions hereof.

Indexed Debt Security:
---------------------

The term "Indexed Debt Security" means a Debt Security the
terms of which provide that the principal amount thereof payable at
Stated Maturity may be more or less than the principal face amount
thereof at original issuance.

Interest:
--------

The term "interest", when used with respect to an Original
Issue Discount Debt Security which by its terms bears interest only
after maturity, means interest payable after maturity.

Interest Payment Date:
---------------------

The term "Interest Payment Date", when used with respect to
any series of Debt Securities, means the Stated Maturity of an
installment of interest on such Debt Securities.

Market Exchange Rate:
--------------------

The term "Market Exchange Rate" shall have the meaning set
forth in Section 3.11.

<PAGE> 69

Officers' Certificate:
---------------------

The term "Officers' Certificate", when used with respect to
the Company, means a certificate signed by the Appropriate Officers
and delivered to the Trustee. Each such certificate shall include the
statements provided for in Section 15.05 to the extent required by the
provisions of such Section.

Opinion of Counsel:
------------------

The term "Opinion of Counsel" shall mean an opinion in
writing signed by legal counsel who may be an employee of or counsel
to the Company, and who shall be reasonably acceptable to the Trustee.
Each such opinion shall include the statements provided for in
Section 3.04 and Section 15.05 to the extent required by the
provisions of such Sections.

Original Issue Discount Debt Security:
-------------------------------------

The term "Original Issue Discount Date Security" means any
Debt Security which provides for an amount less than the principal
amount thereof to be due and payable upon a declaration of
acceleration of the maturity thereof pursuant to Section 7.01.

Outstanding:
-----------

The term "Outstanding", when used with respect to Debt
Securities or Debt Securities of any series, means, as of the date of
determination, all such Debt Securities theretofore authenticated and
delivered under this Indenture, except:

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

(ii) such Debt Securities for whose
payment or redemption money in the necessary
amount and in the specified currency 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
Debt Securities, provided, however, that if
such Debt 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;

<PAGE> 70

(iii) such Debt Securities in exchange
for or in lieu of which other such Debt
Securities have been authenticated and
delivered pursuant to this Indenture, or such
Debt Securities which have been paid,
pursuant to this Indenture, unless proof
satisfactory to the Trustee is presented that
any such Debt Securities are held by Persons
in whose hands any of such Debt Securities
are a legal, valid and binding obligation of
the Company; and

(iv) such Debt Securities the
indebtedness in respect to which has been
discharged in accordance with Section 13.02;

provided, however, that in determining whether the Holders of the
requisite principal amount of such Outstanding Debt Securities have
given any request, demand, authorization, direction, notice, consent
or waiver hereunder, such Debt Securities owned by the Company or such
other obligor upon such Debt 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 request, demand, authorization,
direction, notice, consent or waiver, only such Debt Securities which
the Trustee knows to be so owned shall be so disregarded. Such Debt
Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction
of the Trustee the pledgee's right so to act with respect to such Debt
Securities and that the pledgee is not the Company or any other such
obligor upon such Debt Securities or any Affiliate of the Company or
such other obligor. In case of a dispute as to such right, the
decision of the Trustee upon the advice of counsel shall be full
protection to the Trustee. Upon request of the Trustee, the Company
shall furnish to the Trustee promptly an Officers' Certificate listing
and identifying all such Debt Securities, if any, known by the Company
to be owned or held by or for the account of any of the above
described Persons; and, subject to the provisions of Section 8.01, the
Trustee shall be entitled to accept such Officers' Certificate as
conclusive evidence of the facts therein set forth and of the fact
that all such Debt Securities not listed therein are Outstanding for
the purpose of any such determination.

Paying Agent:
------------

The term "Paying Agent" means any Person (including the
Company acting as Paying Agent) authorized by the Company to pay the
principal of and premium, if any, and interest on any Debt Security on
behalf of the Company.

<PAGE> 71

Person:
------

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

Place of Payment:
----------------

The term "Place of Payment", when used with respect to the
Debt Securities of any series, means the place or places where the
principal of (premium, if any) and interest on the Debt Securities of
that series are payable as specified in accordance with Section 3.01.

Predecessor Debt Security:
-------------------------

The term "Predecessor Debt Security" of any particular Debt
Security means every previous Debt Security evidencing all or a
portion of the same debt as that evidenced by such particular Debt
Security, and for the purposes of this definition, any Debt Security
authenticated and delivered under Section 3.07 in lieu of a mutilated,
lost, destroyed or stolen Debt Security shall be deemed to evidence
the same debt as the mutilated, lost, destroyed or stolen Debt
Security.

Principal Office of the Trustee:
-------------------------------

The term "principal office of the Trustee", or other similar
terms, means the principal office of the Trustee in Chicago, Illinois
at which at any particular time its corporate trust business shall be
administered, which office on the date hereof is located at One First
National Plaza, Suite 0126, Chicago, Illinois 60670-0126.

Principal Property:
------------------

<PAGE> 72

is not of material importance to the business conducted by the Company
and its Restricted Subsidiaries taken as a whole, or (ii) any such
plant, warehouse, office building or parcel of real property or
portion thereof designated by the Board of Directors (evidenced by a
Board Resolution) as being held primarily for development and/or sale.

Redemption Date:
---------------

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

Redemption Price:
----------------

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

Regular Record Date:
-------------------

The term "Regular Record Date" for the interest payable on
any Debt Security on any Interest Payment Date means the date
specified in such Debt Security as the "Regular Record Date" as
contemplated by Section 3.01.

Responsible Officer:
-------------------

The term "Responsible Officer", when used with respect to
the Trustee, means the chairman or any vice-chairman of the board of
directors, the chairman or any vice-chairman of the executive
committee of the board of directors, the chairman of the trust
committee, the president, any vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the
cashier, any assistant cashier, any trust officer or assistant trust
officer, the controller or any assistant controller or any other
officer of the Trustee customarily performing functions similar to
those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.

Restricted Subsidiary:
---------------------

The term "Restricted Subsidiary" means any Subsidiary other
than an Unrestricted Subsidiary.

<PAGE> 73

Secured Debt:
------------

The term "Secured Debt" means any Funded Debt which is
secured by a Security Interest in (a) any Principal Property or (b)
any shares of capital stock or indebtedness of any Restricted
Subsidiary which owns a Principal Property.

Security Interest:
-----------------

The term "Security Interest" means any mortgage, pledge,
lien, encumbrance, conditional sale, title retention agreement or
other security interest which secures payment or performance of an
obligation.

Senior Officer:
--------------

The term "Senior Officer" means any one of the Chief
Executive Officer, the Chief Operating Officer, the Chief Financial
Officer or the Treasurer of the Company.

Special Record Date:
-------------------

The term "Special Record Date" for the payment of any
Defaulted Interest (as defined in Section 3.08) means a date fixed by
the Trustee pursuant to Section 3.08.

Stated Maturity:
---------------

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

Subsidiary:
----------

The term "Subsidiary," as to any Person, means (i) any
corporation more than 50% of the outstanding securities having
ordinary voting power of which shall at the time be owned, directly or
indirectly, by such Person or by one or more of its Subsidiaries or by
such Person and one or more of its Subsidiaries, or (ii) any
partnership, association, joint venture or similar business
organization more than 51% of the ownership interests having ordinary
voting power of which shall at the time be so owned. Unless otherwise
expressly provided, all references herein to a "Subsidiary" shall mean
a Subsidiary of the Company.

<PAGE> 74

Trustee:
-------

The term "Trustee" means The First National Bank of Chicago
and, subject to the provisions of Article Eight hereof, shall also
include its successors and assigns as Trustee hereunder.

Trust Indenture Act of 1939:
---------------------------

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

Unrestricted Subsidiary:
-----------------------

The term "Unrestricted Subsidiary" means any Subsidiary that
at the time of determination has been designated in a Board Resolution
(or a Company Order pursuant to a Board Resolution) as an
"Unrestricted Subsidiary" for purposes of this Indenture so long as
such designation has not been revoked in a subsequent Board Resolution
(or a subsequent Company Order pursuant to a Board Resolution) and any
Subsidiary of such a designated Unrestricted Subsidiary; provided,
however, that (1) the Company may not revoke the designation of an
Unrestricted Subsidiary as such (and thereby convert such Subsidiary
to a Restricted Subsidiary) if the Company would thereby breach any
covenant contained herein on the assumption that any Secured Debt of
such Subsidiary was incurred immediately after the time of such
revocation and that any Sale and Leaseback Transaction to which such
Subsidiary is then a party was entered into immediately after the time
of such revocation, and (2) until the Trustee receives from the
Company a Board Resolution (or a Company Order pursuant to a Board
Resolution) designating one or more Subsidiaries as an Unrestricted
Subsidiary, there shall be no Unrestricted Subsidiaries.

ARTICLE TWO.

DEBT SECURITY FORMS.

SECTION 2.01. FORMS GENERALLY. The Debt Securities of each
series and the certificates of authentication thereon shall have such
appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture (the provisions of
which shall be appropriate to reflect the terms of each series of Debt
Securities, including the currency or denomination, which may be
Dollars or a Foreign Currency), and may have such letters, numbers or
other marks of identification and such legends or endorsements placed
thereon, as may be required to comply with the rules of any securities
exchange, or as may, consistently herewith, be determined by the

<PAGE> 75

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

SECTION 2.02. FORMS OF DEBT SECURITIES. The Debt
Securities of each series shall be in such form or forms (including
global form) as shall be established by or pursuant to a Board
Resolution. The definitive Debt Securities and coupons, if any, shall
be printed, lithographed or engraved or produced by any combination of
these methods on a steel engraved border or steel engraved borders or
may be produced in any other manner, all as determined by the officers
of the Company executing such Debt Securities or coupons, as evidenced
by their execution thereof.

SECTION 2.03. FORM OF TRUSTEE'S CERTIFICATE OF
AUTHENTICATION. The following is the form of the Certificate of
Authentication of the Trustee to be endorsed on the face of all Debt
Securities substantially as follows:

This is one of the Debt Securities of the series
designated herein issued under the within-mentioned
Indenture.

The First National Bank of Chicago,
as Trustee

By:_____________________________________
Authorized Officer

SECTION 2.04. DEBT SECURITIES IN GLOBAL FORM. (a) If the
Company shall establish pursuant to Section 3.01 that the Debt
Securities of a particular series are to be issued in whole or in part
in the form of one or more Global Debt Securities, then the Company
shall execute and the Trustee or its agent shall, in accordance with
Section 3.04 and the Company Order delivered to the Trustee or its
agent thereunder, authenticate and deliver such Global Debt Security
or Global Debt Securities, which (i) shall represent, and shall be
denominated in an amount equal to the aggregate principal amount of
the Outstanding Debt Securities of such series to be represented by
such Global Debt Security or Global Debt Securities, or such portion
thereof as the Company shall specify in a Company Order, (ii) shall be
registered in the name of the Depository for such Global Debt Security
or Global Debt Securities or its nominee, (iii) shall be delivered by
the Trustee or its agent to the Depository or pursuant to the
Depository's instruction and (iv) shall bear a legend substantially to
the following effect (or such other form that is acceptable to the
applicable Depository and the Trustee): "Unless this certificate is
presented by an authorized representative of the Depository to the
Company or its agent for registration of transfer, exchange, or
payment, and any certificate issued is registered in the name of the

<PAGE> 76

nominee of the Depository or in such other name as is requested by an
authorized representative of the Depository (and any payment is made
to the nominee of the Depository or to such other entity as is
requested by an authorized representative of the Depository), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, the
nominee of the Depository, has an interest herein."

(b) Notwithstanding any other provision of this Section
2.04 or of Section 3.06, and subject to the provisions of paragraph
(c) below, unless the terms of a Global Debt Security expressly permit
such Global Debt Security to be exchanged in whole or in part for
individual certificates representing Debt Securities, a Global Debt
Security may be transferred, in whole but not in part and in the
manner provided in Section 3.06, only to a nominee of the Depository
for such Global Debt Security, or to the Depository, or a successor
Depository for such Global Debt Security selected or approved by the
Company, or to a nominee of such successor Depository.

(c) (1) If at any time the Depository for a Global Debt
Security notifies the Company that it is unwilling or unable to
continue as Depository for such Global Debt Security or if at any time
the Depository for the Global Debt Securities for such series shall no
longer be eligible or in good standing under the Securities Exchange
Act of 1934, as amended, or other applicable statute or regulation,
the Company shall appoint a successor Depository with respect to such
Global Debt Security. If a successor Depository for such Global Debt
Security is not appointed by the Company within 90 days after the
Company receives notice or becomes aware of such ineligibility, the
Company will execute, and the Trustee or its agent, upon receipt of a
Company Request for the authentication and delivery of certificates
representing Debt Securities of such series in exchange for such
Global Debt Security, will authenticate and deliver, certificates
representing Debt Securities of such series of like tenor and terms in
an aggregate principal amount equal to the principal amount of the
Global Debt Security in exchange for such Global Debt Security.

(2) The Company may at any time and in its sole
discretion determine that the Debt Securities of any series or portion
thereof issued or issuable in the form of one or more Global Debt
Securities shall no longer be represented by such Global Debt Security
or Global Debt Securities. In such event the Company will execute, and
the Trustee, upon receipt of a Company Request for the authentication
and delivery of certificates representing Debt Securities of such
series in exchange in whole or in part for such Global Debt Security,
will authenticate and deliver certificates representing Debt
Securities of such series of like tenor and terms in definitive form
in an aggregate principal amount equal to the principal amount of such
Global Debt Security or Global Debt Securities representing such
series or portion thereof in exchange for such Global Debt Security or
Global Debt Securities.

<PAGE> 77

(3) If specified by the Company pursuant to Section
3.01 with respect to Debt Securities issued or issuable in the form of
a Global Debt Security, the Depository for such Global Debt Security
may surrender such Global Debt Security in exchange in whole or in
part for certificates representing Debt Securities of such series of
like tenor and terms in definitive form on such terms as are
acceptable to the Company and such Depository. Thereupon the Company
shall execute, and the Trustee or its agent shall authenticate and
deliver, without a service charge, (1) to each Holder specified by the
Depository a certificate or certificates representing Debt Securities
of the same series of like tenor and terms and of any authorized
denomination as requested by such Person in an aggregate principal
amount equal to and in exchange for such Holder's beneficial interest
as specified by the Depository in the Global Debt Security; and (2) to
such Depository a new Global Debt Security of like tenor and terms and
in an authorized denomination equal to the difference, if any, between
the principal amount of the surrendered Global Debt Security and the
aggregate principal amount of certificates representing Debt
Securities delivered to Holders thereof.

(4) In any exchange provided for in any of the
preceding three paragraphs, the Company will execute and the Trustee
or its agent will authenticate and deliver certificates representing
Debt Securities in definitive registered form in authorized
denominations for Debt Securities of the same series or any integral
multiple thereof. Upon the exchange of the entire principal amount of
a Global Debt Security for certificates representing Debt Securities,
such Global Debt Security shall be canceled by the Trustee or its
agent. Except as provided in the preceding paragraph, certificates
representing Debt Securities issued in exchange for a Global Debt
Security pursuant to this Section shall be registered in such names
and in such authorized denominations for Debt Securities of that
Series or any integral multiple thereof, as the Depository shall
instruct the Trustee or its agent. The Trustee shall deliver at the
Principal Office of the Trustee such certificates representing Debt
Securities to the Holders in whose names such Debt Securities are so
registered.

(5) With respect to any Global Debt Security, nothing
herein shall prevent the Company, the Trustee, or any agent of the
Company or the Trustee, from giving effect to any request, demand,
authorization, direction, notice, consent, waiver or other action
provided in this Indenture to be given or taken by a Depository or
impair, as between the Depository and holders of beneficial interests,
the operation of customary practices governing the exercise of the
rights of the Depository (or its nominee) as Holder of any Debt
Security. Without limiting the generality of the foregoing sentence,
a Depository that is a Holder of a Global Debt Security, may make,
give or take, by a proxy or proxies duly appointed in writing, any
request, demand, authorization, direction, notice, consent, waiver or
other action provided in or pursuant to this Indenture, and a
Depository that is a Holder of a Global Security may give its proxy or
proxies to the Depository's participants or the beneficial owners of

<PAGE> 78

interests in any such Global Debt Security, as the case may be,
through such Depository's standing instructions and customary
practices. The Trustee shall fix a record date for the purpose of
determining the Persons who are beneficial owners of interests in any
Global Debt Security held by a Depository and who are entitled under
the procedures of such Depository to make, give or take, by a proxy or
proxies duly appointed in writing, any request, demand, authorization,
direction, notice, consent, waiver or other action provided in or
pursuant to this Indenture to be made, given or taken by Holders. If
such a record date is fixed, the Holders on such record date or their
duly appointed proxy or proxies, and only such Persons, shall be
entitled to make, give or take such request, demand, authorization,
direction, notice, consent, waiver or other action, whether or not
such Holders remain Holders after such record date. No such request,
demand, authorization, direction, notice, consent, waiver or other
action shall be valid or effective if made, given or taken more than
90 days after such record date. None of the Company, the Trustee, any
Paying Agent or any agent of the foregoing will have any
responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial ownership interests of a
Debt Security in global form or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.

ARTICLE THREE.

THE DEBT SECURITIES.

SECTION 3.01. AMOUNT UNLIMITED; TITLE AND TERMS. The
aggregate principal amount of Debt Securities which may be
authenticated and delivered under this Indenture is unlimited. The
Debt Securities may be issued up to the aggregate principal amount of
Debt Securities from time to time authorized by or pursuant to a Board
Resolution.

The Debt Securities may be issued in one or more series.
All Debt Securities of each series issued under this Indenture shall
in all respects be equally and ratably entitled to the benefits hereof
with respect to such series without preference, priority or
distinction on account of the actual time or times of the
authentication and delivery or maturity of the Debt Securities of such
series. There shall be established in or pursuant to a Board
Resolution, and set forth in (or determined in the manner provided in)
an Officers' Certificate to the extent not established in a Board
Resolution, or established in one or more indentures supplemental
hereto, prior to the issuance of Debt Securities of any series:

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

(b) any limit upon the aggregate principal amount
of the Debt Securities of the series which may be
authenticated and delivered under this Indenture

<PAGE> 79

(except for Debt Securities authenticated and delivered
upon registration of transfer of, or in exchange for,
or in lieu of, other Debt Securities of that series
pursuant to this Article Three, the second paragraph of
Section 4.03, or Section 11.04);

(c) the date or dates (or the manner of calcula-
tion thereof) on which the principal of the Debt
Securities of the series is payable;

(d) the rate or rates (or the manner of
calculation thereof) at which the Debt Securities of
the series shall bear interest, if any, the date or
dates from which such interest shall accrue, the
Interest Payment Dates on which such interest shall be
payable and the Regular Record Date for the interest
payable on any Interest Payment Date;

(e) the Place of Payment;

(f) the period or periods within which, the price
or prices at which, the currency or currency units in
which, and the terms and conditions upon which Debt
Securities of the series may be redeemed, in whole or
in part, at the option of the Company;

(g) the obligation, if any, of the Company to
redeem or purchase Debt Securities of the series
pursuant to any sinking fund or analogous provisions or
at the option of a Holder thereof and the period or
periods within which, the price or prices in the
currency at which, the currency or currency units in
which, and the terms and conditions upon which Debt
Securities of the series shall be redeemed or
purchased, in whole or in part, pursuant to such
obligation;

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

(i) if other than Dollars, the currencies in
which payments of interest or principal of (and
premium, if any, with respect to) the Debt Securities
of the series are to be made;

(j) if the interest on or principal of (or
premium, if any, with respect to) the Debt Securities
of the series are to be payable, at the election of the
Company or a Holder thereof or otherwise, in a currency
other than that in which such Debt Securities are
payable, the period or periods within which, and the

<PAGE> 80

other terms and conditions upon which, such election
may be made, and the time and manner of determining the
exchange rate between the currency in such Debt
Securities are denominated or stated to be able and the
currency in which such Debt Securities or any of them
are to be so payable;

(k) whether the amount of payments of interest on
or principal of (or premium, if any, with respect to)
the Debt Securities of such series may be determined
with reference to an index, formula or other method
(which index, formula or other method may be based,
without limitation, on one or more currencies,
commodities, equity indices or other indices), and, if
so, the terms and conditions upon which and the manner
in which such amounts shall be determined and paid or
payable;

(l) the extent to which any Debt Securities will
be issuable in permanent global form or any other form,
the manner in which any payments on a permanent global
Debt Security will be made, and the appointment of any
Depository relating thereto;

(m) any deletions from, modifications of or
additions to the Events of Default or covenants with
respect to the Debt Securities of such series, whether
or not such Events of Default or covenants are
consistent with the Events of Default or covenants set
forth herein;

(n) if any of the Debt Securities of such series
are to be issuable upon the exercise of warrants, this
shall be so established as well as the time, manner and
place for such Debt Securities to be authenticated and
delivered; and

(o) any other terms of the series (which terms
shall not be inconsistent with the provisions of this
Indenture).

All Debt Securities of any one series shall be substantially
identical except as to denomination, currency of payment due
thereunder, the rate of interest (if any) payable thereon, and Stated
Maturities and except as may otherwise be provided in or pursuant to
such Board Resolution and set forth in such Officers' Certificate or
in any such indenture supplemental hereto. Not all Debt Securities of
any one series need to be issued at the same time.

SECTION 3.02. DENOMINATIONS; REGISTERED FORM. The Debt
Securities of each series shall be issuable in such denominations and
such form as shall be specified as contemplated in Section 3.01. In
the absence of any specification with respect to the Debt Securities

<PAGE> 81

of any series, the Debt Securities of such series shall be issuable in
registered form without coupons in denominations of $1,000 and any
integral multiple thereof, which may be in Dollars or any Foreign
Currency.

SECTION 3.03. PAYMENT OF PRINCIPAL AND INTEREST. The
principal of, premium, if any, and interest on the Debt Securities
shall be payable at the office or agency of the Company designated for
that purpose in the Place of Payment, as provided in Section 5.02;
provided, however, that interest may be payable, at the option of the
Company, by check mailed to the address of the Person entitled thereto
as such address shall appear on the Debt Security Register on the
Regular Record Date for such interest payment. In addition, payment
of the principal of, premium, if any, and interest on Debt Securities
may, at the option of the Company, be made by wire transfer of
immediately available funds provided that the applicable Paying Agent
has received from the Holder to whom such payment is due wire transfer
instructions deemed by such Paying Agent to be complete and
appropriate in sufficient time to make such payment by wire transfer.

SECTION 3.04. EXECUTION OF DEBT SECURITIES. The Debt
Securities shall be executed manually or by facsimile in the name and
on behalf of the Company by the Appropriate Officers under its
corporate seal (which may be printed, engraved or otherwise reproduced
thereon, by facsimile or otherwise).

In case any officer of the Company who shall have executed
any of the Debt Securities shall cease to be such officer before the
Debt Securities so executed shall have been authenticated and
delivered by the Trustee, or disposed of by the Company, such Debt
Securities nevertheless shall be valid and binding and may be
authenticated and delivered or disposed of as though the Person who
executed such Debt Securities had not ceased to be such officer of the
Company; and any Debt Securities may be executed on behalf of the
Company by such Persons as, at the actual date of the execution of
such Debt Security, shall be the proper officers of the Company,
although at the date of such Debt Security or of the execution of this
Indenture any such Person was not such an officer.

At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Debt Securities of
any series, properly created in accordance with Section 3.01 and
executed by the Company, to the Trustee for authentication; and the
Trustee shall authenticate and deliver such Debt Securities upon
Company Order. In the event that any other Person performs the
Trustee's duties as Authenticating Agent pursuant to a duly executed
agreement, the Company shall notify the Trustee in writing of the
issuance of any Debt Securities hereunder to be authenticated by such
other Person, such notice to be delivered in accordance with the
provisions of Section 15.03 on the date such Debt Securities are
delivered by the Company for authentication to such other Person.

<PAGE> 82

Prior to any such authentication and delivery of any Debt
Security, the Trustee shall be entitled to receive, and shall be fully
protected in relying upon:

(a) The Board Resolution by or pursuant to which
the form of such Debt Security has been established as
contemplated by Sections 2.02 and Section 3.01,
respectively;

(b) An Officers' Certificate delivered to the
Trustee stating that all conditions precedent provided
for in this Indenture relating to the authentication
and delivery of such Debt Security in such form have
been complied with; and

(c) An Opinion of Counsel stating that: (1) the
form and terms of such Debt Security have been
established in conformity with the provisions of this
Indenture; (2) such Debt Security, together with any
coupons appertaining thereto, when (i) completed by
appropriate insertions and executed and delivered by
the Company to the Trustee for authentication in
accordance with this Indenture, (ii) authenticated and
delivered by such Trustee in accordance with this
Indenture within the authorization as to aggregate
principal amount established from time to time by the
Board of Directors, and (iii) sold in the manner
specified in such Opinion of Counsel, will be the
legal, valid and binding obligations of the Company,
subject to applicable bankruptcy, reorganization,
insolvency and other similar laws generally affecting
creditors' rights, to general equitable principles and
to such other qualifications as the counsel rendering
such Opinion of Counsel shall conclude are customary or
do not materially affect the rights of Holders of such
Debt Securities; and (3) such other matters (if any) as
the Trustee may reasonably request.

Notwithstanding the provisions of Section 3.01 and of the
preceding paragraph, if not all the Debt Securities of any series are
to be issued at one time, it shall not be necessary to deliver the
Officers' Certificate otherwise contemplated pursuant to Section 3.01
or the Board Resolution, Officers' Certificate and Opinion of Counsel
otherwise required pursuant to the preceding paragraph prior to or at
the time of issuance of each Debt Security, but such documents shall
be delivered prior to or at the time of issuance of the first Debt
Security of such series. After any such first delivery, any separate
request by the Company that the Trustee authenticate Debt Securities
of such series for original issue will be deemed to be a certification
by the Company that all conditions precedent provided for in this
Indenture relating to authentication and delivery of such Debt
Securities continue to have been complied with.

<PAGE> 83

The Trustee shall not be required to authenticate such Debt
Securities if the issue thereof will adversely affect the Trustee's
own rights, duties or immunities under the Debt Securities and this
Indenture or otherwise in a manner which is not reasonably acceptable
to the Trustee or such action would expose the Trustee to personal
liability to existing Holders.

Unless otherwise provided in the form of Debt Security for
any series, all Debt Securities shall be dated the date of their
authentication.

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

SECTION 3.05. TEMPORARY DEBT SECURITIES. Pending the
preparation of definitive Debt Securities of any series, the Company
may execute, and upon receipt of the documents required by Sections
3.01 and 3.04, together with a Company Order, the Trustee shall
authenticate and deliver, such temporary Debt Securities which may be
printed, lithographed, typewritten, mimeographed or otherwise
produced, in any authorized denominations, substantially of the tenor
of such definitive Debt Securities in lieu of which they are issued
and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such temporary Debt
Securities may determine, as evidenced by their execution of such
temporary Debt Securities.

If temporary Debt Securities of any series are issued, the
Company will cause definitive Debt Securities of such series to be
prepared without unreasonable delay. After the preparation of
definitive Debt Securities of any series, the temporary Debt
Securities of such series shall be exchangeable for definitive Debt
Securities of such series, upon surrender of the temporary Debt
Securities of such series at any office or agency maintained by the
Company for such purposes as provided in Section 5.02, without charge
to the Holder. Upon surrender for cancellation of any one or more
temporary Debt Securities of any series, the Company shall execute and
the Trustee shall authenticate and deliver in exchange therefore a
like principal amount of definitive Debt Securities of such series
having the same interest rate and Stated Maturity and bearing interest
from the same date of any authorized denominations. Until so
exchanged the temporary Debt Securities of such series shall in all
respects be entitled to the same benefits under this Indenture as
definitive Debt Securities of such series.

<PAGE> 84

SECTION 3.06. EXCHANGE AND REGISTRATION OF TRANSFER OF DEBT
SECURITIES. Debt Securities may be exchanged for a like aggregate
principal amount of Debt Securities of such series that are of other
authorized denominations. Debt Securities to be exchanged shall be
surrendered at any office or agency to be maintained for such purpose
by the Company, as provided in Section 5.02, and the Company shall
execute and the Trustee shall authenticate and deliver in exchange
therefor the Debt Security or Debt Securities of authorized
denominations which the Holder making the exchange shall be entitled
to receive. Each agent of the Company appointed pursuant to Section
5.02 as a person authorized to register and register transfer of Debt
Securities is sometimes herein referred to as a "Debt Security
registrar."

The Company shall keep, at each such office or agency of the
Company maintained for such purpose, as provided in Section 5.02, a
register for each series of Debt Securities hereunder (the registers
of all Debt Security registrars being herein sometimes collectively
referred to as the "Debt Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide
for the registration of Debt Securities and shall register the
transfer of Debt Securities as in this Article Three provided. At all
reasonable times, such Debt Security Register shall be open for
inspection by the Trustee and any Debt Security registrar other than
the Trustee. Upon due presentment for registration of transfer of any
Debt Security at any such office or agency, the Company shall execute
and register and the Trustee shall authenticate and deliver in the
name of the transferee or transferees a new Debt Security or Debt
Securities of authorized denominations for an equal aggregate
principal amount. Registration or registration of transfer of any
Debt Security by any Debt Security registrar in the registry books
maintained by such Debt Security registrar, and delivery of such Debt
Security, duly authenticated, shall be deemed to complete the
registration or registration of transfer of such Debt Security.

The Company will at all times designate one Person (who may
be the Company and who need not be a Debt Security registrar) to act
as repository of a master list of names and addresses of Holders of
the Debt Securities. The Trustee shall act as such repository unless
and until some other Person is, by written notice from the Company to
the Trustee and each Debt Security registrar, designated by the
Company to act as such. The Company shall cause each Debt Security
registrar to furnish to such repository, on a current basis, such
information as such repository may reasonably request as to
registrations, transfers, exchanges and other transactions effected by
such registrar, as may be necessary or advisable to enable such
repository to maintain such master list on as current a basis as is
reasonably practicable.

No Person shall at any time be appointed as or act as a Debt
Security registrar unless such Person is at such time empowered under
applicable law to act as such and duly registered to act as such under
and to the extent required by applicable law and regulations.

<PAGE> 85

All Debt Securities presented to a Debt Security registrar
for registration of transfer shall be duly endorsed by, or be
accompanied by a written instrument or instruments of transfer in form
satisfactory to the Company and such Debt Security registrar duly
executed by the registered Holder or his attorney duly authorized in
writing.

No service charge shall be made for any exchange or
registration of transfer of Debt Securities, but the Company may
require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection therewith.

The Company shall not be required to issue, exchange or
register a transfer of (a) any Debt Securities of any series for a
period of 15 days next preceding the mailing of a notice of redemption
of Debt Securities of such series and ending at the close of business
on the day of the mailing of a notice of redemption of Debt Securities
of such series so selected for redemption, or (b) any Debt Securities
selected, called or being called for redemption except, in the case of
any Debt Security to be redeemed in part, the portion thereof not so
to be redeemed.

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

None of the Trustee, any agent of the Trustee, any Paying
Agent or the Company will have any responsibility or liability for any
aspect of the records relating to or payments made on account of
beneficial ownership interests of a Global Debt Security or for
maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.

SECTION 3.07. MUTILATED, DESTROYED, LOST OR STOLEN DEBT
SECURITIES. In case any temporary or definitive Debt Security shall
become mutilated or be destroyed, lost or stolen, the Company in its
discretion may execute, and upon its request the Trustee shall
authenticate and deliver, a new Debt Security, bearing a number,
letter or other distinguishing mark not contemporaneously Outstanding,
in exchange and substitution for the mutilated Debt Security, or in
lieu of and in substitution for the Debt Security so destroyed, lost
or stolen. In every case the applicant for a substituted Debt
Security shall furnish to the Company and to the Trustee such security
or indemnity as may be required by them to save each of them harmless,
and, in every case of destruction, loss or theft, the applicant shall
also furnish to the Company and to the Trustee evidence to their
satisfaction of the destruction, loss or theft, of such Debt Security
and of the ownership thereof.

In the absence of notice to the Trustee or the Company that
such Debt Security has been acquired by a bona fide purchaser, the

<PAGE> 86

Trustee shall authenticate any such substituted Debt Security and
deliver the same upon any Company Request. Upon the issuance of any
substituted Debt Security, the Company may require the payment of a
sum sufficient to cover any tax or other governmental charge that may
be imposed in relation thereto and any other expenses connected
therewith. In case any Debt Security which has matured or is about to
mature shall become mutilated or be destroyed, lost or stolen, the
Company may, instead of issuing a substituted Debt Security, pay or
authorize the payment of the same (without surrender thereof except in
the case of a mutilated Debt Security) if the applicant for such
payment shall furnish to the Company and to the Trustee such security
or indemnity as may be required by them to save each of them harmless
and, in case of destruction, loss or theft, evidence satisfactory to
the Company and to the Trustee of the destruction, loss or theft of
such Debt Security and of the ownership thereof.

Every substituted Debt Security issued pursuant to the
provisions of this Section 3.07 by virtue of the fact that any Debt
Security is destroyed, lost or stolen shall constitute an additional
contractual obligation of the Company, whether or not the destroyed,
lost or stolen Debt Security shall be found at any time, and shall be
entitled to all the benefits of this Indenture equally and
proportionately with any and all other Debt Securities duly issued
hereunder. All Debt Securities shall be held and owned upon the
express condition that the foregoing provisions are exclusive with
respect to the replacement or payment of mutilated, destroyed, lost or
stolen Debt Securities and shall preclude (to the extent permitted by
law) any and all other rights or remedies with respect to the
replacement or payment of negotiable instruments or other securities
without their surrender.

SECTION 3.08. PAYMENT OF INTEREST; INTEREST RIGHTS
PRESERVED. Interest which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date, on any Debt Security,
shall unless otherwise provided in such Debt Security be paid to the
Person in whose name the Debt Security (or one or more Predecessor
Debt Securities) is registered at the close of business on the Regular
Record Date for such interest.

Unless otherwise stated in the form of Debt Security of a
series, interest on the Debt Securities of any series shall be
computed on the basis of a 360 day year comprised of twelve 30 day
months.

Any interest on any Debt 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 registered Holder on the relevant Regular Record Date
by virtue of having been such Holder, and such Defaulted Interest may
be paid by the Company, at its election in each case, as provided in
Clause (1) or (2) below:

<PAGE> 87

(1) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names any
such Debt Securities (or their respective Predecessor
Debt 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 Debt Security and the date of the
proposed payment, 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. Thereupon the Trustee shall fix a
Special Record Date for the payment of such Defaulted
Interest which 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 shall promptly notify the Company of such
Special Record Date and, 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 of such Debt Securities, at his
address as it appears in the Debt 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 mailed as aforesaid, such Defaulted Interest shall
be paid to the Persons in whose names such Debt
Securities (or their respective Predecessor Debt
Securities) are registered 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 Debt Securities of that series 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 payment shall be deemed practicable by the
Trustee.

Subject to the foregoing provisions of this Section, each
Debt Security delivered under this Indenture upon transfer of or in
exchange for or in lieu of any other Debt Security shall carry the

<PAGE> 88

rights to interest accrued and unpaid, and to accrue, which were
carried by such other Debt Security.

SECTION 3.09. PERSONS DEEMED OWNERS. The Company, the
Trustee and any agent of the Company or the Trustee may treat the
Person in whose name any Debt Security is registered as the owner of
such Debt Security for the purpose of receiving payment of principal
of, premium, if any, and (subject to Section 3.08) interest on, such
Debt Security and for all other purposes whatsoever whether or not
such Debt Security be overdue, and neither the Company, the Trustee,
nor any agent of the Company or the Trustee shall be affected by
notice to the contrary. Without limiting the foregoing, no holder of
any beneficial interest in any Global Debt Security held on its behalf
by a Depository (or its nominee) shall have any rights under this
Indenture with respect of such Global Debt Security or any Debt
Security represented thereby, and such Depository may be treated by
the Company, the Trustee, and any agent of the Company or the Trustee
as the owner of such Global Debt Security or any Debt Security
represented thereby for all purposes whatsoever.

SECTION 3.10. CANCELLATION OF DEBT SECURITIES PAID, ETC.
All Debt Securities surrendered for the purpose of payment,
redemption, exchange or registration of transfer or delivered in
satisfaction in whole or in part of any sinking fund obligation shall,
if surrendered to the Company or any agent of the Trustee or the
Company under this Indenture, be delivered to the Trustee and promptly
canceled by it, or, if surrendered to the Trustee, shall be promptly
cancelled by it, and no Debt Securities shall be issued in lieu
thereof except as expressly permitted by any of the provisions of this
Indenture. The Trustee shall dispose of cancelled Debt Securities in
accordance with a Company Order.

SECTION 3.11. DEBT SECURITIES IN FOREIGN CURRENCIES. With
respect to Debt Securities denominated in a Foreign Currency, the
following provisions shall apply unless otherwise set forth in such
Debt Securities or in the supplemental indenture (if any) pursuant to
which such Debt Securities were established pursuant to Section 3.01:

(a) If the principal of (and premium, if any) and interest
on any Debt Securities is payable in a Foreign Currency and such
Foreign Currency is not available for payment due to the imposition of
exchange controls or other circumstances beyond the control of the
Company, then the Company shall be entitled to satisfy its obligations
under this Indenture to Holders of such Debt Securities by making such
payment in Dollars on the basis of the Market Exchange Rate for such
Foreign Currency on the latest date for which such Market Exchange
Rate may be established by the Currency Determination Agent on or
before the date on which the applicable payment is due. Any payment
made pursuant to this Section 3.11 in Dollars where the required
payment is in a Foreign Currency shall not constitute a default under
this Indenture.

<PAGE> 89

(b) The "Market Exchange Rate" shall be determined by the
Currency Determination Agent and shall mean, for any currency, the
exchange rate pursuant to which such currency shall be converted into
Dollars for purposes of this Section 3.11, as reasonably determined by
the Currency Determination Agent.

(c) The Company, the Trustee and each Paying Agent shall be
fully justified and protected in relying on and acting upon the
information received by it from the Currency Determination Agent and
shall not otherwise have any duty or obligation to determine such
information independently.

ARTICLE FOUR.

REDEMPTION OF DEBT SECURITIES; SINKING FUNDS.

SECTION 4.01. APPLICABILITY OF ARTICLE. The Company may
reserve the right to redeem and pay before Stated Maturity all or any
part of the Debt Securities of any series, either by optional
redemption, sinking fund (mandatory or optional) or otherwise, by
provision therefor in the form of Debt Security for such series on
such terms as are specified in such form or the Board Resolution or
Officers' Certificate delivered pursuant to Section 3.01 or the
indenture supplemental hereto as provided in Section 3.01 with respect
to Debt Securities of such series. Redemption of Debt Securities of
any series shall be made in accordance with the terms of such Debt
Securities and, to the extent that this Article does not conflict with
such terms, in accordance with this Article.

SECTION 4.02. NOTICE OF REDEMPTION; SELECTION OF DEBT
SECURITIES. In case the Company shall desire to exercise the right to
redeem all, or, as the case may be, any part of a series of Debt
Securities pursuant to Section 4.01, the Company shall fix a date for
redemption and the Company, or, at the Company's request, the Trustee
in the name of and at the expense of the Company, shall mail a notice
of such redemption at least 30 and not more than 60 days prior to the
date fixed for redemption to the Holders of Debt Securities so to be
redeemed as a whole or in part at their last addresses as the same
appear on the Debt Securities Register. Such mailing shall be by
first class mail. The notice if mailed in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not
the Holder receives such notice. In any case, failure to give such
notice by mail or any defect in the notice to the Holder of any Debt
Security designated for redemption as a whole or in part shall not
affect the validity of the proceedings for the redemption of any other
Debt Security.

Notice of redemption shall be given in the name of the
Company and shall specify the date fixed for redemption, the
redemption price at which Debt Securities of any series are to be
redeemed, the place of payment (which shall be at the offices or
agencies to be maintained by the Company pursuant to Section 5.02),
that payment of the redemption price will be made upon presentation

<PAGE> 90

and surrender of such Debt Securities, that interest accrued to the
date fixed for redemption will be paid as specified in said notice,
that on and after said date interest thereon or on the portions
thereof to be redeemed will cease to accrue, and the Section of this
Indenture pursuant to which Debt Securities will be redeemed. In case
less than all Debt Securities of any series are to be redeemed, the
notice of redemption shall also identify the particular Debt
Securities to be redeemed as a whole or in part and shall state that
the redemption is for the sinking fund, if such is the case. In case
any Debt Security is to be redeemed in part only, the notice of
redemption shall state the portion of the principal amount thereof to
be redeemed and shall state that on and after the date fixed for
redemption, upon surrender of such Debt Security, a new Debt Security
or Debt Securities of such series in aggregate principal amount equal
to the unredeemed portion thereof will be issued without charge to the
Holder.

If less than all the Debt Securities of any series are to be
redeemed, the Company shall give the Trustee notice, at least 45 days
(or such shorter period acceptable to the Trustee) in advance of the
date fixed for redemption, as to the aggregate principal amount of
Debt Securities to be redeemed. Debt Securities may be redeemed in
part in multiples equal to the minimum authorized denomination for
Debt Securities of such series or any multiple thereof. Thereupon the
Trustee shall select, in such manner as in its sole discretion it
shall deem appropriate and fair, the Debt Securities or portions
thereof to be redeemed, and shall as promptly as practicable notify
the Company of the Debt Securities or portions thereof so selected.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Debt Securities
of any series shall relate, in the case of any Debt Security redeemed
or to be redeemed only in part, to the portion of the principal amount
of such Debt Security which has been or is to be redeemed.

On or prior to the date fixed for redemption specified in
the notice of redemption given as provided in this Section 4.02, the
Company will deposit with the Trustee or with the Paying Agent an
amount of money in the currency in which the Debt Securities of such
series are payable sufficient to redeem on the date fixed for
redemption all the Debt Securities so called for redemption at the
appropriate redemption price, together with accrued interest to the
date fixed for redemption.

The Trustee shall not mail any notice of redemption of any
series of Debt Securities during the continuation of any default in
payment of interest on any series of Debt Securities when due or of
any Event of Default, except that where notice of redemption with
respect to any series of Debt Securities shall have been mailed prior
to the occurrence of such default or Event of Default, the Trustee
shall redeem such Debt Securities provided funds are deposited with it
for such purpose.

<PAGE> 91

SECTION 4.03. PAYMENT OF DEBT SECURITIES CALLED FOR
REDEMPTION. If notice of redemption has been given as herein
provided, the Debt Securities or portions of Debt Securities with
respect to which such notice has been given shall become due and
payable on the date and at the place stated in such notice at the
applicable redemption price, together with interest accrued to the
date fixed for redemption, and on and after said date (unless the
Company shall default in the payment of such Debt Securities or
portions thereof at the redemption price, together with interest
accrued to said date) interest on the Debt Securities or portions of
Debt Securities so called for redemption shall cease to accrue, and
such Debt Securities and portions of Debt Securities shall be deemed
not to be Outstanding hereunder and shall not be entitled to any
benefit under this Indenture except to receive payment of the
redemption price, together with accrued interest to the date fixed for
redemption. On presentation and surrender of such Debt Securities at
the place of payment in said notice specified, the said Debt
Securities or the specified portions thereof shall be paid and
redeemed by the Company at the applicable redemption price, together
with interest accrued thereon to the date fixed for redemption;
provided, however, that any installments of interest becoming due on
the date fixed for redemption shall be payable to the Holders of such
Debt Securities, or one or more previous Debt Securities evidencing
all or a portion of the same debt as that evidenced by such particular
Debt Securities, registered as such on the relevant record dates
according to their terms and the provisions of Section 3.08.

Upon presentation and surrender of any Debt Security
redeemed in part only, with, if the Company or the Trustee so
required, 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, the Company
shall execute and the Trustee shall authenticate and deliver to the
Holder thereof, at the expense of the Company, a new Debt Security or
Debt Securities of the same series having the same interest rate and
Stated Maturity and bearing interest from the same date, of any
authorized denominations as requested by such Holder, in aggregate
principal amount equal to the unredeemed portion of the Debt Security
so presented and surrendered.

SECTION 4.04. EXCLUSION OF CERTAIN SECURITIES FROM
ELIGIBILITY FOR SELECTION FOR REDEMPTION. Debt Securities shall be
excluded from eligibility for selection for redemption if they are
identified by registration and certificate number in a written
statement signed by a Responsible Officer of the Company and delivered
to the Trustee at least 45 days prior to the last date on which notice
of redemption may be given as being owned of record and beneficially
by, and not pledged or hypothecated by, either (a) the Company or (b)
an entity specifically identified in such written statement directly
or indirectly controlling or controlled by or under direct or indirect
common control with the Company.

<PAGE> 92

SECTION 4.05. PROVISIONS WITH RESPECT TO ANY SINKING FUNDS.
Unless the form or terms of any series of Debt Securities shall
provide otherwise, in lieu of making all or any part of any mandatory
sinking fund payment with respect to such series of Debt Securities in
cash, the Company may at its option (1) deliver to the Trustee for
cancellation any Debt Securities of such series theretofore acquired
by the Company, or (2) receive credit for any Debt Securities of such
series (not previously so credited) acquired by the Company and
theretofore delivered to the Trustee for cancellation, then Debt
Securities so delivered or credited shall be credited at the
applicable sinking fund Redemption Price with respect to the Debt
Securities of such series.

On or before the 45th day next preceding each sinking fund
Redemption Date, the Company will deliver to the Trustee a certificate
signed by a Senior Officer specifying (i) the portion of the mandatory
sinking fund payment to be satisfied by deposit of cash in the
currency in which the Debt Securities of such series are payable, by
delivery of Debt Securities theretofore purchased or otherwise
acquired by the Company (which Debt Securities shall accompany such
certificate) and by credit for Debt Securities acquired by the Company
and theretofore delivered to the Trustee for cancellation redeemed by
the Company and stating that the credit to be applied has not
theretofore been so applied or applied in lieu of retiring Funded Debt
pursuant to Section 5.06 and (ii) whether the Company intends to
exercise its right, if any, to make an optional sinking fund payment,
and, if so, the amount thereof. Such certificate shall also state
that no Event of Default has occurred and is continuing. Such
certificate shall be irrevocable and upon its delivery the Company
shall be obligated to make the payment or payments therein referred
to, if any, on or before the next succeeding sinking fund payment
date. In case of the failure of the Company on or before the 45th day
next preceding each sinking fund Redemption Date to deliver such
certificate (or to deliver the Debt Securities specified in this
paragraph), the sinking fund payment due on the next succeeding
sinking fund payment date shall be paid entirely in cash (in the
currency described above) and shall be sufficient to redeem the
principal amount of Debt Securities as a mandatory sinking fund
payment, without the option to deliver or credit Debt Securities as
provided in the first paragraph of this Section 4.04 and without the
right to make an optional sinking fund payment as provided herein.

If the sinking fund payment or payments (mandatory or
optional) with respect to any series of Debt Securities made in cash
(in the currency described above) shall exceed the minimum authorized
denomination set forth in an Officers' Certificate pursuant to Section
3.01 or the equivalent in the currency in which the Debt Securities of
such series are payable (or a lesser sum if the Company shall so
request), unless otherwise provided by the terms of such series of
Debt Securities, said cash shall be applied by the Trustee on the
sinking fund Redemption Date with respect to Debt Securities of such
series at the applicable sinking fund Redemption Price with respect to
Debt Securities of such series, together with accrued interest, if

<PAGE> 93

any, to the date fixed for redemption, with the effect provided in
Section 4.03. The Trustee shall select, in the manner provided in
Section 4.02, for redemption on such sinking fund Redemption Date a
sufficient principal amount of Debt Securities of such series to
utilize said cash and shall thereupon cause notice of redemption of
the Debt Securities of such series for the sinking fund to be given in
the manner provided in Section 4.02 (and with the effect provided in
Section 4.03) for the redemption of Debt Securities in part at the
option of the Company. Debt Securities of any series which are
identified by registration and certificate number in an Officer's
Certificate at least 45 days prior to the sinking fund Redemption Date
as being beneficially owned by, and not pledged or hypothecated by,
the Company or an entity directly or indirectly controlling or
controlled by or under direct or indirect common control with the
Company shall be excluded from Debt Securities of such series eligible
for selection for redemption. Any sinking fund moneys not so applied
or allocated by the Trustee to the redemption of Debt Securities of
such series shall be added to the next cash sinking fund payment with
respect to Debt Securities of such series received by the Trustee and,
together with such payment, shall be applied in accordance with the
provisions of this Section 4.05. Any and all sinking fund moneys with
respect to Debt Securities of any series held by the Trustee at the
maturity of Debt Securities of such series, and not held for the
payment or redemption of particular Debt Securities of such series,
shall be applied by the Trustee, together with other moneys, if
necessary, to be deposited sufficient for the purpose, to the payment
of the principal of the Debt Securities of such series at maturity.

The Trustee shall not convert any currency in which the Debt
Securities of such series are payable for the purposes of such sinking
fund application unless a Company Request is made, and any such
conversion agreed to by the Trustee in response to such request shall
be for the account and at the expense of the Company and shall not
affect the Company's obligation to pay the Holders in the currency to
which such Holder is entitled.

On or before each sinking fund Redemption Date provided with
respect to Debt Securities of any series, the Company shall pay to the
Trustee in cash in the currency described above a sum equal to all
accrued interest, if any, to the date fixed for redemption on Debt
Securities to be redeemed on such sinking fund Redemption Date
pursuant to this Section 4.05.

ARTICLE FIVE.

PARTICULAR COVENANTS OF THE COMPANY.

SECTION 5.01. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.
The Company will duly and punctually pay or cause to be paid (in the
currency in which the Debt Securities of such series are payable) the
principal of and premium, if any, and interest on each of the Debt
Securities at the place (subject to Section 3.03), at the respective

<PAGE> 94

times and in the manner provided in each series of Debt Securities and
in this Indenture.

SECTION 5.02. OFFICES FOR NOTICES AND PAYMENTS, ETC. (a) So
long as the Debt Securities of any series remain Outstanding, the
Company will maintain at the Place of Payment for such series, an
office or agency where the Debt Securities of such series may be
presented for payment, an office or agency where such Debt Securities
may be presented for registration or registration of transfer and for
exchange as in this Indenture provided, and an office or agency where
notices and demands to or upon the Company in respect of such Debt
Securities or of this Indenture may be served and shall give the
Trustee written notice thereof and any changes in the location
thereof. The Company hereby initially designates the Principal Office
of the Trustee for each above mentioned purposes, and the Trustee
shall hereby be deemed to have written notice thereof. In case the
Company shall at any time hereafter fail to maintain any such office
or agency, or shall fail to give notice to the Trustee of any change
in the location thereof, presentation and demand may be made and
notice may be served in respect of the Debt Securities or of this
Indenture at the Principal Office of the Trustee.

(b) In addition to the office or agency maintained by the
Company pursuant to Section 5.02(a), the Company may from time to time
designate one or more other offices or agencies where the Debt
Securities may be presented for payment and presented for registration
of transfer and for exchange in the manner provided in this Indenture,
and the Company may from time to time rescind such designations, as
the Company may deem desirable or expedient; provided, however, that
no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain such office and agency at the
Place of Payment, for the purposes abovementioned. The Company will
give to the Trustee prompt written notice of (i) any such designation
or rescission thereof, and (ii) the location of any such office or
agency outside the Place of Payment and of any change of location
thereof.

SECTION 5.03. APPOINTMENTS TO FILL VACANCIES IN TRUSTEE'S
OFFICE. The Company, whenever necessary to avoid or fill a vacancy in
the office of Trustee, will appoint, in the manner provided in Section
8.10, a Trustee, so that there shall at all times be a Trustee
hereunder.

SECTION 5.04. PROVISIONS AS TO PAYING AGENT. (a) (1)
Whenever the Company shall have one or more Paying Agents for any
series of Debt Securities other than the Trustee, it will, on or
before each due date of the principal of (and premium, if any) or
interest on any Debt Securities of such series, deposit with a Paying
Agent a sum sufficient to pay such amount becoming due, such sum to be
held as provided by the Trust Indenture Act of 1939, and (unless such
Paying Agent is the Trustee) the Company will promptly notify the
Trustee of its action or failure so to act.

<PAGE> 95

(2) 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: (i) comply
with the provisions of the Trust Indenture Act of 1939 applicable to
it as a Paying Agent and (ii) during the continuance of any default by
the Company (or any other obligor upon any series of Debt Securities)
in the making of any payment in respect of the Debt Securities of such
series, upon the written request of the Trustee, forthwith pay to the
Trustee all sums held in trust by such Paying Agent as such.

(b) If the Company shall act as its own Paying Agent, it
will, on or prior to each due date of the principal of and premium, if
any, or interest on Debt Securities of any series, set aside,
segregate and hold in trust for the benefit of the Holders of such
Debt Securities a sum sufficient to pay such principal and premium, if
any, or interest so becoming due and will notify the Trustee of any
failure to take such action and of any failure by the Company (or by
any other obligor on such series of Debt Securities) to make any
payment of the principal of and premium, if any, or interest on the
Debt Securities when the same shall become due and payable.

(c) Anything in this Section 5.04 to the contrary
notwithstanding, the Company may, at any time, for the purpose of
obtaining a satisfaction and discharge of this Indenture with respect
to any or all series of Debt Securities then Outstanding, or for any
other reason, pay or cause to be paid to the Trustee all sums held in
trust by the Company, or any Paying Agent hereunder, as required by
this Section 5.04, such sums to be held by the Trustee upon the trusts
herein contained.

(d) Anything in this Section 5.04 to the contrary
notwithstanding, the agreement to hold sums in trust provided in this
Section 5.04 is subject to Section 13.04.

SECTION 5.05. LIMITATION ON SECURED DEBT.

(a) So long as the Debt Securities shall remain
Outstanding, the Company will not at any time create, assume or
guarantee, and will not cause, suffer or permit a Restricted
Subsidiary to create, assume or guarantee any Secured Debt without
making effective provision (and the Company covenants that in such
case it will make or cause to be made effective provision) whereby the
Debt Securities then Outstanding subject to applicable priorities of
payment shall be secured by such Security Interest equally and ratably
with any and all other obligations and indebtedness which shall be so
secured; provided, however, that the foregoing covenants shall not be
applicable to the following:

(1) (i) any Security Interest on any property
hereafter acquired or constructed by the Company or a
Restricted Subsidiary to secure or provide for the
payment of all or any part of the purchase price or

<PAGE> 96

construction cost of such property, including, but not
limited to, any indebtedness incurred by the Company or
a Restricted Subsidiary prior to, at the time of, or
within 180 days after the later of the acquisition, the
completion of construction (including any improvements
on an existing property) or the commencement of
commercial operation of such property, which
indebtedness is incurred for the purpose of financing
all or any part of the purchase price thereof or
construction or improvements thereon (or within six
months thereafter pursuant to a commitment for such
financing arranged with a lender or investor within
such 180-day period); or (ii) the acquisition of
property subject to any Security Interest upon such
property existing at the time of acquisition thereof,
whether or not assumed by the Company or such
Restricted Subsidiary; or (iii) any Security Interest
existing on the property or on the outstanding shares
of capital stock or indebtedness of a Person at the
time such Person shall become a Restricted Subsidiary;
or (iv) a Security Interest on property or shares of
capital stock or indebtedness of a Person existing at
the time such Person is merged into or consolidated
with the Company or a Restricted Subsidiary or at the
time of a sale, lease or other disposition of the
properties of a Person as an entirety or substantially
as an entirety to the Company or a Restricted
Subsidiary, provided, however, that no such Security
Interest shall extend to any other Principal Property
owned by the Company or such Restricted Subsidiary
prior to such acquisition or to another Principal
Property thereafter acquired by the Company or such
Restricted Subsidiary other than additions to such
acquired property;

(2) Security Interests in property of the
Company or a Restricted Subsidiary in favor of the
United States of America or any State thereof, or any
department, agency or instrumentality or political
subdivision of the United States of America or any
State thereof, or in favor of any other country, or any
department, agency or instrumentality or political
subdivision thereof (including, without limitation,
Security Interests to secure indebtedness of the
pollution control or industrial revenue bond type), in
order to permit the Company or a Restricted Subsidiary
to perform any contract or subcontract made by it with
or at the request of any of the foregoing, or to secure
partial, progress, advance or other payments pursuant
to any contract or statute or to secure any
indebtedness incurred for the purpose of financing all
or any part of the purchase price or the cost of

<PAGE> 97

constructing or improving the property subject to such
Security Interests;

(3) Any Security Interest on any property or
assets of any Restricted Subsidiary to secure
indebtedness owing by it to the Company or to a
Restricted Subsidiary;

(4) Mechanics', materialmen's, carriers', land-
lord's, warehousemen's or other like liens imposed by
law or otherwise arising in the ordinary course of
business (including construction of facilities) in
respect of obligations which are not due or which are
being contested in good faith;

(5) Any Security Interest arising by reason of
deposits with, or the giving of any form of security
to, any governmental agency or any body created or
approved by law or governmental regulations, which is
required by law or governmental regulation as a
condition to the transaction of any business, or the
exercise of any privilege, franchise or license;

(6) Security Interests for taxes, assessments or
governmental charges or levies not yet delinquent, or
Security Interests for taxes, assessments or government
charges or levies already delinquent but the validity
of which is being contested in good faith;

(7) Security Interests (including judgment liens)
arising in connection with legal proceedings so long as
such proceedings are being contested in good faith and,
in the case of judgment liens, execution thereon is
stayed;

(8) Security Interests arising out of pledges or
deposits under worker's compensation laws, unemployment
insurance, old age pensions, or other social security
or retirement benefits, or similar legislation or
securing the performance of bids, tenders or contracts
(other than for money borrowed) or to secure indemnity,
performance or similar bonds;

(9) Easements, building restrictions, rights-of-
way and other encumbrances or charges against property
as are of a nature generally existing with respect to
properties of a similar character and which do not in
any material way affect the value of the same or
interfere with the use thereof in the business of the
Company or any Restricted Subsidiary;

<PAGE> 98

(10) Security Interests to secure tax-exempt
private activity bonds under the Internal Revenue Code
of 1986, as amended;

(11) Security Interests existing on the date
hereof; or

(12) Any extension, renewal or replacement (or
successive extensions, renewals or replacements) in
whole or in part of any Security Interest permitted by
subsection (a) of this Section 5.05.

(b) Notwithstanding the provisions of subsection (a) of
this Section 5.05, the Company and any one or more Restricted
Subsidiaries may without securing the Debt Securities issue, assume or
guarantee Secured Debt which would otherwise be subject to the
foregoing restrictions in an aggregate amount which, together with all
other Secured Debt of the Company and its Restricted Subsidiaries
which would otherwise be subject to the foregoing restrictions (not
including Secured Debt permitted to be secured under subsection (a)
above) and the aggregate "value" (as defined in Section 5.06) of the
Sale and Leaseback Transactions (as defined in Section 5.06) in
existence at such time (not including Sale and Leaseback Transactions
the proceeds of which have been or will be applied in accordance with
Section 5.06(b)), does not exceed 10% of Consolidated Net Tangible
Assets.

(c) In the event that the Company shall hereafter secure
the Debt Securities of each series equally and ratably with any other
obligation or indebtedness pursuant to the provisions of this Section
5.05, the Trustee is hereby authorized to enter into an indenture or
agreement supplemental hereto and to take such action, if any, as it
may deem advisable to enable it to enforce effectively the rights of
the Holders of the Securities so secured, equally and ratably with
such other obligation or indebtedness.

SECTION 5.06. SALE AND LEASEBACK TRANSACTIONS. So long as
the Debt Securities shall remain Outstanding, the Company will not,
and will not permit any Restricted Subsidiary to, sell or transfer
(except to the Company or one or more Restricted Subsidiaries, or
both) any Principal Property owned by it and in full operation for
more than 180 days with the intention of taking back a lease on such
property (except a lease for a term of no more than three years)
(herein referred to as a "Sale and Leaseback Transaction") unless
either (a) the Company or such Restricted Subsidiary would be
entitled, pursuant to the provisions of Section 5.05 hereof, to incur
Secured Debt equal in amount to the Capitalized Rent with respect to
such lease secured by a Security Interest on the property to be leased
without equally and ratably securing the Debt Securities, or (b) the
Company or a Restricted Subsidiary shall, within 180 days of the
effective date of any such Sale and Leaseback Transaction, apply an
amount equal to the "value" (as defined below in this Section) of the
property so leased either to the purchase of fixed assets or to the

<PAGE> 99

retirement of Funded Debt; provided, however, that in lieu of applying
all or any part of such amount to such retirement, the Company may at
its option (x) deliver to the Trustee Debt Securities theretofore
purchased or otherwise acquired by the Company, or (y) receive credit
for the Debt Securities theretofore redeemed at its option. If the
Company shall so deliver the Debt Securities to the Trustee (or
receive credit for Debt Securities so delivered), the amount which the
Company shall be required to apply to the retirement of indebtedness
pursuant to this Section 5.06 shall be reduced by an amount equal to
the aggregate principal amount of such Debt Securities.

The term "value" shall mean, with respect to a Sale and
Leaseback Transaction, as of any particular time, the amount equal to
the greater of (i) the net proceeds of the sale of Principal Property
sold and leased back in such Sale and Leaseback Transaction, or (ii)
the fair value of such property at the time of entering into such Sale
and Leaseback Transaction as reasonably determined by the Company, in
either case multiplied by a fraction, the numerator of which shall be
equal to the number of full years of the term of the lease applicable
to such Sale and Leaseback Transaction remaining at the time of
determination and the denominator of which shall be equal to the
number of full years of the term of such lease (without regard to any
unexercised renewal or extension options contained in such lease).

SECTION 5.07. CERTIFICATE TO TRUSTEE. So long as the Debt
Securities of any series remain Outstanding, the Company will deliver
to the Trustee on or before 120 days after the end of each fiscal year
of the Company an Officers' Certificate stating that in the course of
the performance by the signers of their duties as officers of the
Company, they would normally have knowledge of any default by the
Company in the performance or fulfillment or observance of any
covenants or agreements contained herein during the preceding fiscal
year, stating whether or not they have knowledge of any such default
and, if so, specifying each such default of which the signers have
knowledge and the nature thereof. The Officers' Certificate need not
comply with Section 15.05.

SECTION 5.08. WAIVERS OF COVENANTS. Anything in this
Indenture to the contrary notwithstanding, the Company may fail or
omit, in respect of any series of Debt Securities, and in any
particular instance, to comply with a covenant, agreement or condition
contained in Sections 5.02 and 5.04 (other than in 5.04(a)(1) and (2))
to 5.07, inclusive, if the Company shall have obtained and filed with
the Trustee before or after the time for such compliance the consent
in writing of the Holders of more than 50% in aggregate principal
amount of the Debt Securities of the series affected by such waiver at
the time Outstanding, either waiving such compliance in such instance
or generally waiving compliance with such covenant or condition, but
no such waiver shall extend to or affect any obligation not expressly
waived and, until such waiver shall become effective, the obligations
of the Company and the duties of the Trustee in respect of any such
covenant or condition shall remain in full force and effect.

<PAGE> 100

ARTICLE SIX.

HOLDERS' LISTS AND REPORTS BY THE COMPANY
AND THE TRUSTEE.

SECTION 6.01. HOLDERS' LISTS. In accordance with Section
312(a) of the Trust Indenture Act, the Company will furnish or cause
to be furnished to the Trustee:

(a) semi-annually, not later than June 1 and December 1, in
each year, a list, in such form as the Trustee may reasonably require,
containing all the information in the possession or control of the
Company, or any of its Paying Agents other than the Trustee, as to the
names and addresses of the Holders of Debt Securities as of the
preceding May 15 or November 15, as the case may be, and

(b) at such other times as the Trustee may 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, excluding from any
such list names and addresses received by the Trustee in its capacity
as Debt Security registrar.

SECTION 6.02. PRESERVATION AND DISCLOSURE OF LISTS. (a)
The Trustee shall comply with the obligations imposed upon it pursuant
to Section 312 of the Trust Indenture Act of 1939. The Trustee shall
preserve, in as current a form as is reasonably practicable, all
information as to the names and addresses of the Holders of Debt
Securities contained in the most recent list furnished to it as
provided in Section 6.01 or received by the Trustee in the capacity of
the Debt Security registrar (if so acting) under Section 3.06. The
Trustee may destroy any list furnished to it as provided in Section
6.01 upon receipt of a new list so furnished.

(b) The rights of Holders to communicate with other Holders
with respect to their rights under this Indenture or under the Debt
Securities of any series or of all Debt Securities, and the
corresponding rights and duties of the Trustee, shall be as provided
by the Trust Indenture Act of 1939.

(c) Every Holder of Debt 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 of 1939.

SECTION 6.03. REPORTS BY THE COMPANY. The Company agrees
to 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 pursuant to the Trust Indenture Act of
1939 at the times and in the manner provided pursuant to such Act;
provided that any such information, documents or reports required to

<PAGE> 101

be filed with the Commission pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended, shall be filed with the
Trustee within 15 days after the same is so required to be filed with
the Commission.

SECTION 6.04. REPORTS BY THE TRUSTEE. (a) 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 of 1939 at the times and in the manner provided pursuant
thereto. The interval between transmissions of reports to be
transmitted at intervals shall be twelve months or such shorter time
required by the Trust Indenture Act of 1939. If the Trust Indenture
Act of 1939 does not specify the date on which a report is due, the
such report shall be due on July 15 of each year following the first
issuance of Debt Securities.

(b) 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 Debt Securities of any series are listed, with the
Commission and with the Company. The Company will notify the Trustee
when the Debt Securities of any series are listed on any stock
exchange.

ARTICLE SEVEN.

REMEDIES OF THE TRUSTEE AND HOLDERS
ON EVENT OF DEFAULT.

SECTION 7.01. EVENTS OF DEFAULT. Event of Default, with
respect to any series of Debt Securities, wherever used herein, means
any one of the following events (whatever the reason for such Event of
Default and whether it shall 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), unless such event is either
inapplicable to a particular series or it is specifically deleted or
modified in the supplemental indenture under which such series of Debt
Securities is issued or in the form of Debt Security for such series:

(a) default in the payment of any installment of
interest upon any Debt Security of such series as and
when the same shall become due and payable, and
continuance of such default for a period of 30 days; or

(b) default in the payment of the principal of
and premium, if any, on any Debt Security of such
series as and when the same shall become due and
payable either at maturity, upon redemption, by
declaration of acceleration or otherwise; or

(c) default in the payment or satisfaction of any
sinking fund payment or analogous obligation, if any,
with respect to the Debt Securities of such series as

<PAGE> 102

and when the same shall become due and payable by the
terms of the Debt Securities of such series; or

(d) failure on the part of the Company duly to
observe or perform any of the covenants, warrants or
agreements on the part of the Company in respect of the
Debt Securities of such series in this Indenture (other
than a covenant, warranty or agreement a default in
whose performance or whose breach is elsewhere in this
Section specifically dealt with) continued for a period
of 60 days after the date on which written notice of
such failure, specifying such failure and requiring the
same to be remedied, shall have been given to the
Company by the Trustee, by registered mail, or to the
Company and the Trustee by the Holders of at least 25%
in aggregate principal amount of the Outstanding Debt
Securities of such series; or

(e) an event of default as defined in any
mortgage, indenture or instrument under which there may
be issued, or by which there may be secured or
evidenced, any indebtedness of the Company for money
borrowed, whether such indebtedness now exists or shall
hereafter be created, shall happen and shall result in
such indebtedness in principal amount in excess of
$25,000,000 becoming or being declared due and payable
prior to the date on which it would otherwise become
due and payable, and such acceleration shall not be
rescinded or annulled, or such indebtedness shall not
have been discharged, within a period of 30 days after
there shall have been given to the Company by the
Trustee, by registered mail, or to the Company and the
Trustee by the Holders of at least 25% in aggregate
principal amount of the Outstanding Debt Securities of
such series, a written notice specifying such event of
default and requiring the Company to cause such
acceleration to be rescinded or annulled or to cause
such indebtedness to be discharged; or

(f) a decree or order by a court having
jurisdiction in the premises shall have been entered
adjudging the Company a bankrupt or insolvent, or
approving as properly filed a petition seeking
reorganization of the Company under the Federal
bankruptcy laws or any other similar applicable Federal
or state law, and such decree or order shall have
continued undischarged and unstayed for a period of 60
days; or a decree or order of a court having
jurisdiction in the premises for the appointment of a
receiver or liquidator or trustee or assignee or other
similar official in bankruptcy or insolvency of the
Company or of all or substantially all of its property,
or for the winding up or liquidation of its affairs,

<PAGE> 103

shall have been entered, and such decree or order shall
have continued undischarged and unstayed for a period
of 60 days; or

(g) the Company shall institute proceedings to be
adjudicated a voluntary bankrupt, or shall consent to
the filing of a bankruptcy proceeding against it, or
shall file a petition or answer or consent seeking an
arrangement or a reorganization under the Federal
bankruptcy laws or any other similar applicable Federal
or state law, or shall consent to the filing of any
such petition, or shall consent to the appointment of a
receiver or liquidator or trustee or assignee or other
similar official in bankruptcy or insolvency of it or
of all or substantially all of its property, or shall
make an assignment for the benefit of creditors, or
shall admit in writing its inability to pay its debts
generally as they become due; or

(h) any other Event of Default provided in the
supplemental indenture under which such series of Debt
Securities is issued or in the form of Debt Security
for such series.

If an Event of Default with respect to Debt Securities of any series
at the time Outstanding occurs and is continuing (other than an Event
of Default specified in Section 7.01(f) or Section 7.01(g)), then, and
in each and every such case, unless the principal of all of the Debt
Securities of such series shall have already become due and payable,
either the Trustee or the Holders of not less than 25% in aggregate
principal amount of the Debt Securities of such series then
Outstanding (each such series treated as a separate class), by notice
in writing to the Company (and to the Trustee if given by the
Holders), may declare the entire principal (or, if the Debt Securities
of that series are Original Issue Discount Debt Securities, such
portion of the principal amount as may be specified in the terms of
that series) of all Debt Securities of such series and the interest
accrued thereon to be due and payable immediately, and upon any such
declaration the same shall become immediately due and payable. If an
Event of Default described in Section 7.01(f) or Section 7.01(g)
occurs and is continuing with respect to Debt Securities of any series
at the time Outstanding, then and in each every such case, the entire
principal amount (or, if the Debt Securities of that series are
Original Issue Discount Debt Securities, such portion of the principal
amount as may be specified in the terms of that series) of all Debt
Securities of such series and interest accrued thereon shall become
immediately due and payable without any declaration or action on the
part of the Trustee or any Holder. This provision, however, is
subject to the condition that if, at any time after the principal of
the Debt Securities of such series shall have been so declared due and
payable, and before any judgment or decree for the payment of the
moneys due shall have been obtained or entered as hereinafter
provided, the Company shall pay or shall deposit with the Trustee a

<PAGE> 104

sum sufficient to pay in the currency in which the Debt Securities of
such series are payable all matured installments of interest upon all
of the Debt Securities and the principal of and premium, if any, on
any and all Debt Securities of such series which shall have become due
otherwise than by such declaration (with interest on overdue
installments of interest to the extent that payment of such interest
is enforceable under applicable law and on such principal and premium,
if any, at the rate borne by the Debt Securities of such series or as
otherwise provided in the form of Debt Security for such series, to
the date of such payment or deposit) and the expenses of the Trustee
(subject to Section 8.06), and any and all defaults under this
Indenture, other than the nonpayment of principal of and accrued
interest on Debt Securities of such series which shall have become
due by such declaration, shall have been cured or shall have been
waived in accordance with Section 7.07 or provision deemed by the
Trustee to be adequate shall have been made therefor then and in
every such case the Holders of at least a majority in aggregate
principal amount of the Debt Securities of such series then
Outstanding, by written notice to the Company and to the Trustee, may
rescind and annul such declaration and its consequences; but no such
rescission and annulment shall extend to or shall affect any
subsequent default, or shall impair any right consequent thereon.

In case the Trustee or any Holders shall have proceeded to
enforce any right under this Indenture and such proceedings shall have
been discontinued or abandoned because of such rescission and
annulment or for any other reason or shall have been determined
adversely to the Trustee, then and in every such case the Company, the
Trustee and the Holders shall be restored respectively to their
several positions and rights hereunder, and all rights, remedies and
powers of the Company, the Trustee and the Holders shall continue as
though no such proceeding had been taken.

SECTION 7.02. PAYMENT OF DEBT SECURITIES UPON DEFAULT; SUIT
THEREFOR. The Company covenants that (a) in case default shall be
made in the payment of any instalment of interest upon any Debt
Security of any series as and when the same shall become due and
payable, and such default shall have continued for a period of 30
days, or (b) in case default shall be made in the payment of the
principal of and premium, if any, on any Debt Security of any series
as and when the same shall have become due and payable, whether at
maturity of the Debt Security or upon redemption or by declaration or
otherwise or (c) in case default shall be made in the making or
satisfaction of any sinking fund payment or analogous obligation with
respect to the Debt Securities of any series when the same becomes due
by the terms of the Debt Securities of any series then, upon demand of
the Trustee, the Company will pay to the Trustee, for the benefit of
the Holders (or Holders of Debt Securities of any such series in the
case of clause (c) above), the whole amount that then shall have
become due and payable on any such Debt Security (or Debt Securities
of any such series in the case of clause (3) above) for principal and
premium, if any, or interest, or both, as the case may be, with
interest upon the overdue principal and premium, if any, and (to the

<PAGE> 105

extent that payment of such interest is enforceable under applicable
law) upon the overdue installments of interest at the rate borne by
the Debt Securities of such series or as otherwise provided in the
form of Debt Security of such series; and, in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses
of collection, including a reasonable compensation to the Trustee, its
agents, attorneys and counsel, and any expenses or liabilities
incurred and advances made by the Trustee, except compensation or
advances arising, or expenses or liabilities incurred, as a result of
the Trustee's negligence or bad faith.

Until such demand is made by the Trustee, the Company may
pay the principal of and premium, if any, and interest on the Debt
Securities of any series to the Persons entitled thereto, whether or
not the principal of and premium, if any, and interest on the Debt
Securities of such series are overdue.

In case the Company shall fail forthwith to pay such amounts
upon such demand, the Trustee, in its own name and as trustee of an
express trust, shall be entitled and empowered to institute any
actions or proceedings at law or in equity for the collection of the
sums so due and unpaid, and may prosecute any such action or
proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor on
such Debt Securities and collect, in the manner provided by law out of
the property of the Company or any other obligor on such Debt
Securities wherever situated, the moneys adjudged or decreed to be
payable. If any Event of Default with respect to any series of Debt
Securities occurs and is continuing, the Trustee may in its discretion
proceed to protect and enforce its rights and the rights of the
Holders of Debt Securities of such series 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.

In case there shall be pending proceedings for the
bankruptcy or for the reorganization of the Company or any other
obligor on the Debt Securities of any series under the Federal
bankruptcy laws or any other applicable law, or in case a receiver or
trustee shall have been appointed for the property of the Company or
such other obligor, or in the case of any other similar judicial
proceedings relative to the Company or other obligor upon the Debt
Securities of any series, or to the creditors or property of the
Company or such other obligor, the Trustee, irrespective of whether
the principal of the Debt Securities of such series 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
pursuant to the provisions of this Section 7.02, shall be entitled and
empowered by intervention in such proceedings or otherwise, (a) to
file and prove a claim or claims for the whole amount of principal and
interest owing and unpaid in respect of the Debt Securities of such
series, and, in case of any judicial proceedings, to file such proofs

<PAGE> 106

of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and of the
Holders of the Debt Securities of such series allowed in such judicial
proceedings relative to the Company or any other obligor on such Debt
Securities, its or their creditors, or its or their property, (b)
unless prohibited by applicable law and regulations, to vote on behalf
of the Holders of any Debt Securities of any series in any election of
a trustee or a standby trustee in arrangement, reorganization,
liquidation or other bankruptcy or insolvency proceedings or person
performing similar functions in comparable proceedings, and (c) to
collect and receive any moneys or other property payable or
deliverable on any such claims, and to distribute the same after the
deduction of its charges and expenses; and any receiver, assignee or
trustee in bankruptcy or reorganization is hereby authorized by each
of the Holders of the Debt Securities of such series to make such
payments to the Trustee, and, in the event that the Trustee shall
consent to the making of such payments directly to such Holders, to
pay to the Trustee such amount as shall be sufficient to cover
reasonable compensation to the Trustee, its agents, attorneys and
counsel, and all other expenses and liabilities incurred and advances
made by the Trustee except compensation or advances arising, or
expenses or liabilities incurred, as a result of the Trustee's
negligence or bad faith.

Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept, or adopt on behalf of
any Holder any plan or reorganization, arrangement, adjustment or
composition affecting the Debt Securities or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim
of any Holder (except, as aforesaid, for the election of a trustee in
bankruptcy or other Person performing similar functions) in any such
proceeding.

All rights of action and of asserting claims under this
Indenture, or under any of the Debt Securities of any series, may be
enforced by the Trustee without the possession of any of such Debt
Securities, or the production thereof on any trial or other proceeding
relative thereto, and any such suit or proceeding instituted by the
Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment shall be for the ratable benefit
of the Holders of the Debt Securities of such series in respect of
which such judgment has been recovered.

In any proceedings brought by the Trustee (and also any
proceedings involving the interpretation of any provision of this
Indenture to which the Trustee shall be a party), the Trustee shall be
held to represent all the Holders of the Debt Securities in respect to
which such action was taken, and it shall not be necessary to make any
Holders of such Debt Securities parties to any such proceedings.

SECTION 7.03. APPLICATION OF MONEYS COLLECTED BY TRUSTEE.
Any moneys collected by the Trustee pursuant to Section 7.02 shall be
applied in the order following, at the date or dates fixed by the

<PAGE> 107

Trustee for the distribution of such moneys, upon presentation of the
Debt Securities of such series, and stamping thereon the payment, if
only partially paid, and upon surrender thereof, if fully paid:

FIRST: To the payment of costs and expenses of
collection and reasonable compensation to the Trustee,
its agents, attorneys and counsel, and of all other
expenses and liabilities incurred, and all advances
made, by the Trustee except compensation or advances
arising, or expenses or liabilities incurred, as a
result of its negligence or bad faith, and any other
amounts owing the Trustee under Section 8.06;

SECOND: In case the principal of the Debt
Securities of such series shall not have become due and
be unpaid, to the payment of interest on such Debt
Securities, in the order of the maturity of the
installments of such interest, with interest (to the
extent that such interest has been collected by the
Trustee) upon the overdue installments of interest at
the rate borne by such Debt Securities, such payments
to be made ratable to the Persons entitled thereto;

THIRD: In case the principal of the Debt
Securities of such series shall have become due, by
declaration or otherwise, to the payment of the whole
amount then owing and unpaid upon such Debt Securities
for principal and premium, if any, and interest, with
interest on the overdue principal and premium, if any,
and (to the extent that such interest has been
collected by the Trustee) upon overdue installments of
interest at the rate borne by such Debt Securities; and
in case such moneys shall be insufficient to pay in
full the whole amounts so due and unpaid upon such Debt
Securities, then, to the payment of such principal and
premium, if any, and interest without preference or
priority of principal and premium, if any, over
interest, or of interest over principal and premium,
if any, or of any instalment of interest over any other
instalment of interest, or of any Debt Security of such
series over any other such Debt Security, ratably to
the aggregate of such principal and premium, if any,
and accrued and unpaid interest;

FOURTH: To the payment of any surplus then
remaining to the Company, its successors or assigns, or
to whomsoever may be lawfully entitled to receive the
same.

SECTION 7.04. PROCEEDINGS BY HOLDERS. No Holder of any
Debt Security of any series shall have any right by virtue of or by
availing of any provision of this Indenture to institute any suit,
action or proceeding in equity or at law or in bankruptcy or otherwise

<PAGE> 108

upon or under or with respect to this Indenture or for the appointment
of a receiver or trustee, or for any other remedy hereunder, unless
such Holder previously shall have given to the Trustee written notice
of default and of the continuance thereof, as hereinbefore provided,
and unless also the Holders of not less than 25% in aggregate
principal amount of the Debt Securities of such series then
Outstanding shall have made written request upon the Trustee to
institute such action, suit or proceeding in its own name as Trustee
hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee for 60
days after its receipt of such notice, request and offer of indemnity,
shall have neglected or refused to institute any such action, suit or
proceeding (and no direction inconsistent with such written request
shall have been given to the Trustee pursuant to Section 7.07), it
being understood and intended, and being expressly covenanted by the
taker and Holder of every Debt Security of every series with every
other taker and Holder and the Trustee, that no one or more Holders of
Debt Securities 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 Holder of such Debt
Securities, or to obtain or seek to obtain priority over or preference
to any other such Holder, or to enforce any right under this
Indenture, except in the manner herein provided and for the equal,
ratable and common benefit of all Holders of Debt Securities.

SECTION 7.05. PROCEEDINGS BY TRUSTEE. In case of an Event
of Default hereunder the Trustee may in its discretion proceed to
protect and enforce the rights vested in it by this Indenture by such
appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any of such rights, either by suit in
equity or by action at law or by proceeding in bankruptcy or
otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any
power granted in this Indenture, or to enforce any other legal or
equitable right vested in the Trustee by this Indenture or by law.

SECTION 7.06. REMEDIES CUMULATIVE AND CONTINUING. All
powers and remedies given by this Article Seven to the Trustee or to
the Holders shall, to the extent permitted by law, be deemed
cumulative and not exclusive of any thereof or of any other powers and
remedies available to the Trustee or the Holders, by judicial
proceedings or otherwise, to enforce the performance or observance of
the covenants and agreements contained in this Indenture, and no delay
or omission of the Trustee or of any Holder to exercise any right or
power accruing upon any default occurring and continuing as aforesaid
shall impair any such right or power, or shall be construed to be a
waiver of any such default or an acquiescence therein; and, subject to
the provisions of Section 7.04, every power and remedy given by this
Article Seven or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as shall be deemed
expedient, by the Trustee or by the Holders.

<PAGE> 109

SECTION 7.07. DIRECTION OF PROCEEDINGS AND WAIVER OF
DEFAULTS BY MAJORITY OF HOLDERS. The Holders of a majority in
aggregate principal amount of the Outstanding Debt Securities of any
series 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 with respect to
the Debt Securities of such series by this Indenture; provided,
however, that (subject to the provisions of Section 8.01) the Trustee
shall have the right to decline to follow any such direction if the
Trustee shall determine upon advice of counsel that the action or
proceeding so directed may not lawfully be taken or would be
materially and unjustly prejudicial to the rights of Holders not
joining in such direction or if the Trustee in good faith by its board
of directors or trustees, executive committee, or a trust committee of
directors or trustees and/or Responsible Officers shall determine that
the action or proceeding so directed would involve the Trustee in
personal liability or if the Trustee in good faith shall so determine
that the actions or forebearances specified in or pursuant to such
direction would be unduly prejudicial to the interests of Holders of
the Debt Securities of all series not joining in the giving of said
direction, it being understood that (subject to Section 8.01) the
Trustee shall have no duty to ascertain whether or not such actions or
forebearances are duly prejudicial to such Holders. The Trustee may
take any other action deemed proper by the Trustee not inconsistent
with such direction. The Holders of a majority in aggregate principal
amount of the Outstanding Debt Securities of any series may on behalf
of the Holders of all the Debt Securities of such series waive any
past default or Event of Default hereunder and its consequences except
a default in the payment of principal of or premium, if any, or
interest on such Debt Securities, or a default in the making of any
sinking fund payment with respect to such Debt Securities. Upon any
such waiver the Company, the Trustee and the Holders of such Debt
Securities shall be restored to their former positions and rights
hereunder, respectively; but no such waiver shall extend to any
subsequent or other default or Event of Default. Whenever any default
or Event of Default shall have been waived as permitted by this
Section 7.07, said default or Event of Default shall for all purposes
of the Debt Securities and this Indenture be deemed to have been cured
and to be not continuing.

This Section 7.07 shall be in lieu of Sections 316(a)(1)(A)
and 316(a)(1)(B) of the Trust Indenture Act of 1939 and such Sections
316(a)(1)(A) and Section 316(a)(1)(B) are hereby expressly excluded
from this Indenture, as permitted by the Trust Indenture Act of 1939.

SECTION 7.08. NOTICE OF DEFAULTS. Within 90 days after the
occurrence of any default hereunder with respect to the Debt
Securities of any series, the Trustee shall transmit, in the manner
and to the extent provided in Section 313(c) of the Trust Indenture
Act, notice of all such defaults hereunder known to the Trustee,
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 (or premium, if any) or interest on any Debt Security of

<PAGE> 110

such series or in the payment of any sinking fund installment with
respect to Debt Securities of such series, the Trustee shall be
protected in withholding such notice if and so long as the board of
directors, the executive committee or a trust committee of directors
or Responsible Officers of the Trustee in good faith determine that
the withholding of such notice is in the interest of the Holders of
Debt Securities of such series; and provided, further, that in the
case of any default of the character specified in Section 7.01(d) with
respect to Securities of such series, no such notice to Holders shall
be given until at least 60 days after the occurrence thereof. 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 with respect to Debt Securities of such series.

SECTION 7.09. UNDERTAKING TO PAY COSTS. In any suit for
the enforcement of any right or remedy under this Indenture, or in any
suit against the Trustee for any action taken, suffered or omitted by
it as Trustee, a court may require any party litigant in such suit to
file an undertaking to pay the costs of such suit, and may assess
costs against any such party litigant, in the manner and to the extent
provided in the Trust Indenture Act of 1939; provided that neither
this Section nor the Trust Indenture Act of 1939 shall be deemed to
authorize any court to require such an undertaking or to make such an
assessment in any suit instituted by the Company, and any provision of
the Trust Indenture Act of 1939 to such effect is hereby expressly
excluded from this Indenture, to the extent permitted by the Trust
Indenture Act of 1939.

SECTION 7.10. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE
PRINCIPAL, PREMIUM AND INTEREST. Notwithstanding any other provision
in this Indenture, the Holder of any Debt Security shall have the
rights, which are absolute and unconditional, to receive payment of
the principal of, premium, if any, and (subject to Section 3.08)
interest on such Debt Security on the respective Stated Maturities
expressed in such Debt Security (or in the case of redemption or
repayment, on the date for redemption or repayment, as the case may
be) and to institute suit for the enforcement of any such payment, and
such rights shall not be impaired without the consent of such Holder.

ARTICLE EIGHT.

CONCERNING THE TRUSTEE.

SECTION 8.01. DUTIES AND RESPONSIBILITIES OF TRUSTEE. The
duties and responsibilities of the Trustee shall be as provided by the
Trust Indenture Act of 1939. No implied covenants or obligations,
except as provided by the Trust Indenture Act of 1939, shall be read
into this Indenture against the Trustee, and 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

<PAGE> 111

liability is not reasonably assured to it. 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 8.02. RELIANCE ON DOCUMENTS, OPINIONS, ETC. Subject
to the provisions of Section 8.01,

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

(b) any request, direction, order or demand of
the Company mentioned herein shall be sufficiently
evidenced by an Officers' Certificate (unless otherwise
evidence in respect thereof be herein specifically
prescribed); and any resolution of the Board of
Directors may be evidenced to the Trustee by a copy
thereof certified by the Secretary or an Assistant
Secretary of the Company;

(c) the Trustee may consult with counsel 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 or omitted by it hereunder
in good faith and in accordance with such advice or
Opinion of Counsel;

(d) the Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by
this Indenture at the request, order or direction of
any of the Holders, pursuant to the provisions of this
Indenture, unless such Holders shall have offered to
the Trustee reasonable security or indemnity against
the costs, expenses and liabilities which may be
incurred therein or thereby;

(e) the Trustee shall not be liable for any
action taken or omitted by it in good faith and
believed by it to be authorized or within the
discretion or rights or powers conferred upon it by
this Indenture;

(f) prior to the occurrence of an Event of
Default with respect to the Debt Securities of any
series and after the curing or waiving of all Events of
Default with respect to such Debt Securities, the
Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution,

<PAGE> 112

certificate, statement, instrument, opinion, report,
notice, request, consent, order, approval, bond,
debenture, note, or other paper or document, unless
requested in writing to do so by the Holders of not
less than a majority in principal amount of such Debt
Securities then Outstanding; provided, however, that
the reasonable expenses of every such investigation
shall be paid by the Company or, if paid by the
Trustee, shall be repaid by the Company upon demand;
and provided, further, that if the payment within a
reasonable time to the Trustee of the costs, expenses
or liabilities likely to be incurred by it in the
making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the Trustee by the
security afforded to it by the terms of this
Indenture, the Trustee may require reasonable indemnity
against such expenses or liabilities as a condition to
so proceeding;

(g) 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 liable or responsible for any
misconduct, bad faith or negligence on the part of any
agent or attorney appointed with due care by it
hereunder; and

(h) the Trustee shall not be deemed to have
knowledge of any default or Event of Default unless a
Responsible Officer of the Trustee has actual knowledge
thereof or Holders of greater than 50% of the
outstanding principal amount of Debt Securities of any
series shall have notified the Trustee thereof.

SECTION 8.03. NO RESPONSIBILITY FOR RECITALS, ETC. The
recitals contained herein and in the Debt Securities (except in the
Trustee's certificate of authentication) shall be taken as the
statements of the Company, and the Trustee assumes no responsibility
for the correctness of the same. The Trustee makes no representations
as to the validity or sufficiency of this Indenture or of the Debt
Securities of any series. The Trustee represents that it is duly
authorized to execute and deliver this Indenture and perform its
obligations hereunder and that the statements made by it in any
Statement of Eligibility on Form T-1 supplied by it to the Company are
true and complete (subject to any qualifications set forth therein).
Neither the Trustee nor the Authenticating Agent shall be accountable
for the use or application by the Company or any Debt Securities or
the proceeds of any Debt Securities authenticated and delivered by the
Trustee in conformity with the provisions of this Indenture.

SECTION 8.04. TRUSTEE AND AGENTS MAY OWN DEBT SECURITIES.
The Trustee, any Paying Agent, or any agent of the Trustee or the
Company under this Indenture, in its individual or any other capacity,

<PAGE> 113

may become the owner or pledgee of Debt Securities of any series with
the same rights it would have if it were not Trustee or such agent
and, subject to Sections 8.08 and 8.13, if operative, may otherwise
deal with the Company and receive, collect, hold, and retain
collections from the Company with the same rights it would have if it
were not the Trustee or such agent.

SECTION 8.05. MONEYS TO BE HELD IN TRUST. Subject to the
provisions of Section 13.04, all moneys received by the Trustee shall,
until used or applied as herein provided, be held in trust for the
purposes for which they were received, but need not be segregated from
other funds except to the extent required by law. Neither the Trustee
nor any Paying Agent shall be under any liability for interest on any
moneys received by it hereunder except such as it may agree with the
Company to pay thereon. So long as no Event of Default with respect
to the Debt Securities of any series shall have occurred and be
continuing, all interest allowed on any such moneys shall be paid from
time to time upon the written order of the Company, signed by a Senior
Officer.

SECTION 8.06. COMPENSATION AND EXPENSES OF TRUSTEE. The
Company covenants and agrees to pay to the Trustee from time to time,
and the Trustee shall be entitled to, reasonable compensation (which
shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust), and the Company will
pay or reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee
in accordance with any of the provisions of this Indenture (including
the reasonable compensation and the expenses and disbursements of its
counsel and all persons not regularly in its employ and any amounts
paid by the Trustee to any Authenticating Agent pursuant to Section
8.14) except any such expense, disbursement or advance as may arise
from its negligence or bad faith. The Company also covenants to
indemnify the Trustee for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on the
part of the Trustee and arising out of or in connection with the
acceptance or administration of this trust, or the performance of its
duties hereunder, including the current payment of all costs and
expenses of defending itself against any claim of liability in the
premises. The obligations of the Company under this Section 8.06 to
compensate and indemnify the Trustee and to pay or reimburse the
Trustee for expenses, disbursements and advances shall constitute
additional indebtedness hereunder. Such additional indebtedness shall
be secured by a lien prior to that of the Debt Securities upon all
property and funds held or collected by the Trustee as such, except
funds held in trust for the benefit of the Holders of particular Debt
Securities.

SECTION 8.07. OFFICERS' CERTIFICATE AS EVIDENCE. Subject
to the provisions of Section 8.01, whenever in the administration of
the provisions of this Indenture the Trustee shall deem it necessary
or desirable that a matter be proved or established prior to taking or
omitting any action hereunder, such matter (unless other evidence in

<PAGE> 114

respect thereof be herein specifically prescribed) may, in the absence
of negligence or bad faith on the part of the Trustee, be deemed to be
conclusively proved and established by an Officers' Certificate
delivered to the Trustee, and such Certificate, in the absence of
negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken or omitted by it under the
provisions of this Indenture upon the faith thereof.

SECTION 8.08. CONFLICTING INTEREST OF TRUSTEE. If the
Trustee has or shall acquire any conflicting interest within the
meaning of the Trust Indenture Act of 1939, the Trustee shall either
eliminate such conflicting interest or resign in the manner provided
by, and subject to the provisions of, the Trust Indenture Act of 1939
and this Indenture.

SECTION 8.09. ELIGIBILITY OF TRUSTEE. There shall at all
times be a Trustee with respect to each series of Debt Securities
hereunder which shall be a corporation organized and doing business
under the laws of the United States or any state or territory thereof
or of the District of Columbia authorized under such laws to exercise
corporate trust power's, having a combined capital and surplus of at
least $50,000,000, subject to supervision or examination by Federal,
state, territorial, or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant
to law or to the requirements of the aforesaid supervising or
examining authority, then for the purposes of this Section 8.09, 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. The Trustee shall comply with
Section 310(b) of the Trust Indenture Act, provided that there shall
be excluded from the operation of Section 310(b)(i) of the Trust
Indenture Act any indenture or indentures under which other
securities, or certificates of interest or participation in other
securities, of the Company are outstanding if the requirements for
such exclusion set forth in Section 310(b)(i) of the Trust Indenture
Act are met. In case at any time the Trustee with respect to any
series of Debt Securities shall cease to be eligible in accordance
with the provisions of this Section 8.09, such Trustee shall resign
immediately in the manner and with the effect specified in Section
8.10.

SECTION 8.10. RESIGNATION OR REMOVAL OF TRUSTEE. (a) The
Trustee may at any time resign with respect to any series of Debt
Securities by giving written notice by first class mail of such
resignation to the Company and to the Holders of such series of Debt
Securities at their addresses as they shall appear on the Debt
Security Register. Upon receiving such notice of resignation, the
Company shall promptly appoint a successor trustee with respect to
such series by written instrument, in duplicate, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to
the successor trustee. If no successor trustee with respect to such
series shall have been so appointed and have accepted appointment
within 60 days after the mailing of such notice of resignation to the

<PAGE> 115

Holders, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee, or any Holder
of such series of Debt Securities who has been a bona fide Holder of a
Debt Security or Debt Securities of such series for at least six
months may, subject to the provisions of Section 7.09, on behalf of
himself and all others similarly situated, petition any such court for
the appointment of a successor trustee with respect to such series.
Such court may thereupon, after such notice, if any, as it may deem
proper and prescribe, appoint such successor trustee.

(b) In case at any time any of the following shall occur as
to any series of Debt Securities--

(1) the Trustee shall fail to comply with the
provisions of Section 8.08 after written request
therefor by the Company or by any Holder who has been a
bona fide Holder of a Debt Security or Debt Securities
of such series for at least six months, unless the
Trustee's duty to resign is stayed in accordance with
the provisions of Section 310(b) of the Trust Indenture
Act of 1939, or

(2) the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.09 and
shall fail to resign after written request therefor by
the Company or by any Holder who has been a bona fide
Holder of a Debt Security or Debt Securities of such
series for at least six months, or

(3) the Trustee shall become incapable of acting
with respect to any series of Debt Securities, 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, the Company may remove the Trustee with
respect to such series and appoint a successor trustee for such series
by written instrument, in duplicate, executed on instruction of a
Senior Officer, one copy of which instrument shall be delivered to the
Trustee so removed and one copy to the successor trustee, or, subject
to the provisions of Section 7.09, any Holder who has been a bona fide
Holder of a Debt Security or Debt Securities of such series 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 with respect
to such series. Such court may thereupon, after such notice, if any,
as it may deem proper and prescribe, remove such Trustee and appoint
such successor trustee.

(c) The Holders of a majority in aggregate principal amount
of the Outstanding Debt Securities of any series may at any time

<PAGE> 116

remove the Trustee with respect to such series by delivering to the
Trustee so removed, to the successor trustee so appointed and to the
Company the evidence provided for in Section 9.01 of the action in
that regard taken by the Holders, and nominate a successor Trustee
which shall be deemed appointed as successor Trustee unless within ten
days after such nomination the Company objects thereto, in which case
the Trustee so removed or any Holder of a Debt Security or Debt
Securities of such series, upon the terms and conditions and otherwise
as in subsection (a) of this Section 8.10 provided, may petition any
court of competent jurisdiction for an appointment of a successor
Trustee with respect to such series.

(d) Any resignation or removal of the Trustee with respect
to all or any series of Debt Securities and any appointment of a
successor Trustee pursuant to any of the provisions of this Section
8.10 shall become effective upon acceptance of appointment by the
successor Trustee as provided in Section 8.11.

SECTION 8.11. ACCEPTANCE BY SUCCESSOR TRUSTEE. Any
successor Trustee appointed as provided in Section 8.10 shall execute,
acknowledge and deliver to the Company and to its predecessor Trustee
an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor Trustee shall become
effective with respect to all or any series as to which it is
resigning as Trustee, and such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights,
powers, duties and obligations of its predecessor hereunder with
respect to all or any such series, with like effect as if originally
named as Trustee herein with respect to all or any such series;
nevertheless, on the written request of the Company or of the
successor Trustee, the Trustee ceasing to act shall, upon payment of
any amounts then due it pursuant to the provisions of Section 8.06,
execute and deliver an instrument transferring to such successor
Trustee all the rights and powers of the Trustee with respect to all
or any such series so ceasing to act. Upon request of any such
successor Trustee, the Company shall execute any and all instruments
in writing for more fully and certainly vesting in and confirming to
such successor Trustee all such rights and powers. Any Trustee
ceasing to act shall, nevertheless, retain a lien upon all property or
funds held or collected by such Trustee with respect to all or any
series as to which it is resigning as Trustee, to secure any amounts
and shall be entitled to any indemnities then due it pursuant to the
provisions of Section 8.06.

No successor Trustee shall accept appointment as provided in
this Section 8.11 unless at the time of such acceptance such successor
Trustee shall be qualified under the provisions of Section 8.08 and
eligible under the provisions of Section 8.09.

Upon acceptance of appointment by a successor Trustee with
respect to all or any series of Debt Securities as provided in this
Section 8.11, the Company shall mail notice of the succession of such
Trustee hereunder to the Holders of Debt Securities of such series at

<PAGE> 117

their addresses as they shall appear on the Debt Security Register.
If the Company fails to mail such notice within ten days after
acceptance of appointment by the successor Trustee, the successor
Trustee shall cause such notice to be mailed at the expense of the
Company.

In case the appointment hereunder of a successor Trustee
with respect to the Debt Securities of one or more (but not all)
series, the Company, the retiring Trustee and each successor Trustee
with respect to the Debt Securities of any applicable series shall
execute and deliver an indenture supplemental hereto which shall
contain such provisions as shall be deemed necessary or desirable to
confirm that all the rights, powers, trusts and duties of the retiring
Trustee with respect to the Debt Securities of any series as to which
the retiring Trustee is not retiring shall continue to be vested in
the retiring Trustee, and shall add to or change any of the provisions
of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee,
it being understood that nothing herein or in such supplemental
indenture shall constitute such Trustees co-trustees of the same trust
and that each such Trustee shall be Trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder
administered by any other such Trustee.

SECTION 8.12. SUCCESSION BY MERGER, ETC. Subject to
Sections 8.08 and 8.09, 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
the corporate trust business of the Trustee, shall be the successor of
the Trustee hereunder without the execution or filing of any paper or
any further act on the part of any of the parties hereto.

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

SECTION 8.13. LIMITATION ON RIGHTS OF TRUSTEE AS A
CREDITOR. If and when the Trustee shall be or become a creditor of
the Company (or any other obligor upon the Debt Securities), the
Trustee shall be subject to the provisions of the Trust Indenture Act
of 1939 regarding the collection of claims against the Company (or any
such other obligor).

<PAGE> 118

SECTION 8.14. AUTHENTICATING AGENTS. There may be an
Authenticating Agent or Authenticating Agents appointed by the Trustee
from time to time with power to act on its behalf and subject to its
direction in the authentication and delivery of any series of Debt
Securities issued upon original issuance, exchange, transfer or
redemption thereof as fully to all intents and purposes as though such
Authenticating Agent (or Authenticating Agents) had been expressly
authorized to authenticate and deliver such Debt Securities, and Debt
Securities so authenticated shall be entitled to the benefits of this
Indenture and shall be valid and obligatory for all purposes as though
authenticated by the Trustee hereunder. For all purposes of this
Indenture, the authentication and delivery of Debt Securities by any
Authenticating Agent pursuant to this Section 8.14 shall be deemed to
be the authentication and delivery of such Debt Securities "by the
Trustee", and whenever this Indenture provides that "the Trustee shall
authenticate and deliver" Debt Securities or that Debt Securities
"shall have been authenticated and delivered by the Trustee", such
authentication and delivery by any Authenticating Agent shall be
deemed to be authentication and delivery by the Trustee. Any such
Authenticating Agent shall at all times be a corporation organized and
doing business under the laws of the United States of America or of
any State or Territory or the District of Columbia, with a combined
capital and surplus of at least $50,000,000 and authorized under such
laws to act as an authenticating agent, duly registered to act as
such, if and to the extent required by applicable law and subject to
supervision or examination by Federal or State authority. If such
corporation publishes reports of its condition at least annually
pursuant to law or the requirements of such authority, then for the
purposes of this Section 8.14 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 an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section 8.14, or to be duly
registered if and to the extent required by applicable law and
regulations, it shall resign immediately in the manner and with the
effect herein specified in this Section 8.14.

Whenever reference is made in this Indenture to the
authentication and delivery of Debt Securities of any series by the
Trustee or the Trustee's certificate of authentication, such reference
shall be deemed to include authentication and delivery on behalf of
the Trustee by its Authenticating Agent appointed with respect to the
Debt Securities of such series and a certificate of authentication
executed on behalf of the Trustee by its Authenticating Agent
appointed with respect to the Debt Securities of such series.

Any corporation into which any Authenticating Agent may be
merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, consolidation or conversion to
which any Authenticating Agent shall be a party, or any corporation
succeeding to the authenticating agency business of any Authenticating
Agent, shall be the successor of such Authenticating Agent hereunder,
if such successor corporation is otherwise eligible under this Section

<PAGE> 119

8.14, without the execution or filing of any paper or any further act
on the part of the parties hereto or such Authenticating Agent or such
successor corporation.

In case at the time such successor to any such agency shall
succeed to such agency any of the Debt Securities shall have been
authenticated but not delivered, any such successor to such
Authenticating Agent may adopt the certificate of authentication of
any predecessor Authenticating Agent and deliver such Debt Securities
so authenticated; and in case at that time any of the Debt Securities
shall not have been authenticated, any successor to any Authenticating
Agent may authenticate such Debt Securities either in the name of any
predecessor hereunder or in the name of the successor Authenticating
Agent; and in all cases such certificate shall have the full force
which it has anywhere in the Debt Securities or in this Indenture
provided that the certificate of the predecessor Authenticating Agent
shall have had such force; provided, however, that the right to adopt
the certificate of authentication of any predecessor Authenticating
Agent or to authenticate Debt Securities in the name of any
predecessor Authenticating Agent shall apply only to its successor or
successors by merger, conversion or consolidation.

Any Authenticating Agent may at any time resign as
Authenticating Agent with respect to any series of Debt Securities by
giving written notice of resignation to the Trustee and to the
Company. The Trustee may at any time terminate the agency of any
Authenticating Agent with respect to any series of Debt Securities by
giving written notice of termination 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 Authenticating Agent shall
cease to be eligible under this Section 8.14, the Trustee may, and
shall, upon request of the Company, promptly use its best efforts to
appoint a successor Authenticating Agent.

Upon the appointment, at any time after the original
issuance of any of the Debt Securities, of any successor, additional
or new Authenticating Agent, the Trustee shall give written notice of
such appointment to the Company and shall at the expense of the
Company mail notice of such appointment to all Holders of Debt
Securities of such series as the names and addresses of such Holders
appear on the Debt Security Register.

Any successor Authenticating Agent with respect to any
series of Debt Securities upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as though originally named as
an Authenticating Agent herein with respect to such series. No
successor Authenticating Agent shall be appointed unless eligible
under the provisions of this Section 8.14 and duly registered if and
to the extent required under applicable law and regulations.

Any Authenticating Agent by the acceptance of its
appointment with respect to any series of Debt Securities shall be

<PAGE> 120

deemed to have agreed with the Trustee that: it will perform and carry
out the duties of an Authenticating Agent as herein set forth with
respect to such series, including among other things the duties to
authenticate and deliver Debt Securities when presented to it in
connection with exchanges, registrations of transfer or redemptions
thereof; it will keep and maintain, and furnish to the Trustee from
time to time as requested by the Trustee appropriate records of all
transactions carried out by it as Authenticating Agent and will
furnish the Trustee such other information and reports as the Trustee
may reasonably require; it is eligible for appointment as
Authenticating Agent under this Section 8.14 and will notify the
Trustee promptly if it shall cease to be so qualified; and it will
indemnify the Trustee against any loss, liability or expense incurred
by the Trustee and will defend any claim asserted against the Trustee
by reason of any acts or failures to act of the Authenticating Agent
with respect to such series but it shall have no liability for any
action taken by it at the specific written direction of the Trustee.

The Company agrees to pay to each Authenticating Agent from
time to time reasonable compensation and expenses for its services,
and the Trustee shall have no liability for such payments.

The provisions of Sections 8.02(a), (b), (c), (e) and (f),
8.03, 8.04, 8.06 (insofar as it pertains to indemnification), 9.01,
9.02 and 9.03 shall bind and inure to the benefit of each
Authenticating Agent to the same extent that they bind and inure to
the benefit of the Trustee.

If an appointment with respect to one or more series is made
pursuant to this Section 8.14, the Debt Securities of such series may
have endorsed thereon, in addition to the Trustee's certificate of
authentication, an alternate certificate of authentication in
substantially the following form:

This is one of the Debt Securities of the series designated
herein issued under the within-mentioned Indenture.

The First National Bank of Chicago,
As Trustee

By: [__________________________________]
As Authenticating Agent

By: ___________________________________
Authorized Signatory

<PAGE> 121

ARTICLE NINE.

CONCERNING THE HOLDERS.

SECTION 9.01. ACTION BY HOLDERS. Whenever in this
Indenture it is provided that the Holders of a specified percentage in
aggregate principal amount of the Debt Securities of any series may
take any action (including the making of any demand or request, the
giving of any notice, consent or waiver or the taking of any other
action) the fact that at the time of taking any such action the
Holders of such specified percentage of such series have joined
therein may be evidenced (a) by any instrument or any number of
instruments of similar tenor executed by Holders of such series in
person or by agent or proxy appointed in writing, or (b) by the record
of the Holders of such series voting in favor thereof at any meeting
of such Holders duly called and held in accordance with the provisions
of Article Ten, or (c) by a combination of such instrument or
instruments and any such record of such a meeting of Holders of such
series.

SECTION 9.02. PROOF OF EXECUTION BY HOLDERS. Subject to
the provisions of Sections 8.01, 8.02 and 10.05, proof of the
execution of any instrument by a Holder or his agent or proxy shall be
sufficient if made in accordance with such reasonable rules and
regulations as may be prescribed by the Trustee or in such manner as
shall be satisfactory to the Trustee. The ownership of Debt
Securities shall be provided by the Debt Security Register or by a
certificate of the Debt Security registrar with respect to a series of
Debt Securities.

The record of any Holders' meeting shall be proved in the
manner provided in Section 10.06.

SECTION 9.03. WHO ARE DEEMED ABSOLUTE OWNERS. The Company,
the Trustee with respect to a series of Debt Securities, and any agent
of the Trustee or the Company under this Indenture may deem the Person
in whose name such Debt Security shall be registered upon the Debt
Security Register to be, and may treat him as, the absolute owner of
such Debt Security (whether or not such Debt Security shall be overdue
and notwithstanding any notation of ownership or other writing thereon
made by anyone other than the Company, the Trustee or any such agent)
for the purpose of receiving payment of or on account of the principal
of and premium, if any, and interest on such Debt Security and for all
other purposes; and neither the Company nor the Trustee nor any such
agent shall be affected by any notice to the contrary. All such
payments so made to any Holder for the time being or upon his order
shall, to the extent of the sum or sums so paid, be effectual to
satisfy and discharge the liability for moneys payable upon any such
Debt Security.

SECTION 9.04. COMPANY-OWNED DEBT SECURITIES DISREGARDED.
In determining whether the Holders of the requisite aggregate
principal amount of Debt Securities of any series have concurred in

<PAGE> 122

any direction or consent under this Indenture, Debt Securities of such
series which are owned by the Company or any other obligor on the Debt
Securities of such series or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common
control with the Company or any other obligor on such Debt Securities
shall be disregarded and deemed not to be Outstanding for the propose
of any such determinations; provided, however, that for the purposes
of determining whether the Trustee shall be protected in relying on
any such direction or consent only such Debt Securities which the
Trustee knows are so owned shall be so disregarded. Debt Securities
so owned which have been pledged in good faith may be regarded as
Outstanding notwithstanding this Section 9.04 if the pledgee shall
establish to the satisfaction of the Trustee the right of the pledgee
to vote such Debt Securities and that the pledgee is not a Person
directly or indirectly controlling or controlled by or under direct or
indirect common control with the Company or any such other obligor.
Upon request of the Trustee, the Company shall furnish to the Trustee
promptly an Officer's Certificate listing and identifying all Debt
Securities of a series, if any, known by the Company to be owned or
held by or for the account of the Company or any other obligor on such
Debt Securities or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the
Company or any other obligor on such Debt Securities; and, subject to
the provisions of Section 8.01, the Trustee shall be entitled to
accept such Officers' Certificates as conclusive evidence of the facts
therein set forth and of the fact that all such Debt Securities not
listed therein are Outstanding for the purpose of any such
determination.

SECTION 9.05. REVOCATION OF CONSENTS; FUTURE HOLDERS BOUND.
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 9.01, of the taking of any action by the Holders
of the percentage in aggregate principal amount of the Debt Securities
of any series specified in this Indenture in connection with such
action, any Holder of a Debt Security which is shown by the evidence
to be included in the Debt Securities the Holders of which have
consented to or are bound by consents to such action, may, by filing
written notice with the Trustee at its principal office and upon proof
of holding as provided in Section 9.02, revoke such action so far as
concerns such Debt Security. Except as aforesaid any such action
taken by the Holder of any Debt Security shall be conclusive and
binding upon such Holder and upon all future Holders and owners of
such Debt Security and of any Debt Security issued on transfer thereof
or in exchange or substitution therefor, irrespective of whether or
not any notation in regard thereto is made upon any such Debt
Security. Any action taken by the Holders of the percentage in
aggregate principal amount of the Debt Securities specified in this
Indenture in connection with such action shall be conclusively binding
upon the Company, the Trustee and the Holders of all of the Debt
Securities affected by such action.

<PAGE> 123

ARTICLE TEN.

HOLDERS' MEETINGS.

SECTION 10.01. PURPOSES OF MEETINGS. A meeting of Holders
of the Debt Securities of all or any series may be called at any time
and from time to time pursuant to the provisions of this Article Ten
for any of the following purposes:

(1) to give any notice to the Company or to the
Trustee with respect to such series, or to give any
directions to the Trustee, or to consent to the waiving
of any default hereunder and its consequences, or to
take any other action authorized to be taken by Holders
pursuant to any of the provisions of Article Seven;

(2) to remove the Trustee and nominate a
successor trustee pursuant to the provisions of Article
Eight;

(3) to consent to the execution of an indenture
or indentures supplemental hereto pursuant to the
provisions of Section 11.02; or

(4) to take any other action authorized to be
taken by or on behalf of the Holders of any specified
aggregate principal amount of the Debt Securities of
all or any series, as the case may be, under any other
provision of this Indenture or under applicable law.

SECTION 10.02. CALL OF MEETINGS BY TRUSTEE. The Trustee may
at any time call a meeting of Holders of Debt Securities of all or any
series to take any action specified in Section 10.01, to be held at
such time and at such place as the Trustee shall determine. Notice of
every meeting of the Holders of Debt Securities of all or any series,
setting forth the time and place of such meeting and in general terms
the action proposed to be taken at such meeting, shall be mailed by
the Trustee to Holders of Debt Securities of each series that may be
affected by the action proposed to be taken at such meeting at their
addresses as they shall appear on the Debt Security Register. Such
notice shall be mailed not less than 20 nor more than 90 days prior to
the date fixed for the meeting.

SECTION 10.03. CALL OF MEETINGS BY COMPANY OR HOLDERS. In
case at any time the Company, pursuant to a resolution by the Board of
Directors, or the Holders of at least 10% in aggregate principal
amount of the Debt Securities then Outstanding of each series that may
be affected by the action proposed to be taken shall have requested
the Trustee to call a meeting of such Holders, by written request
setting forth in reasonable detail the action proposed to be taken at
the meeting, and the Trustee shall not have mailed the notice of such
meeting within 20 days after receipt of such request, then the Company
or such Holders may determine the time and place for such meeting and

<PAGE> 124

may call such meeting to take any action authorized in Section 10.01,
by mailing notice thereof as provided in Section 10.02.

SECTION 10.04. QUALIFICATIONS FOR VOTING; RECORD DATES. To
be entitled to vote at any meeting of Holders of Debt Securities a
person shall (a) be a Holder of one or more Debt Securities of a
series affected by the action proposed to be taken or (b) be a Person
appointed by an instrument in writing as proxy by a Holder of one or
more such Debt Securities. The rights of Holders of Debt Securities
to have their votes counted shall be subject to the provision in the
definition of "Outstanding" in Section 1.01. The only Persons who
shall be entitled to be present or to speak at any meeting of Holders
of Debt Securities 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.

Subject to Section 2.04(c)(5), the Company may, in the
circumstances permitted by the Trust Indenture Act, fix any day as the
record date for the purpose of determining the Holders of Debt
Securities of any series 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 to be given or taken by
Holders of Debt Securities of such series. If not set by the Company
prior to the first solicitation of a Holder of Debt Securities of such
series 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 prior to such first
solicitation or vote, or, if later, the date of the most recent list
of Holders required to be provided pursuant to Section 6.01, as the
case may be. With regard to any record date for action to be taken by
the Holders of one or more series of Debt Securities, only the Holders
of Debt Securities of such series on such date (or their duly
designated proxies) shall be entitled to give or take, or vote on, the
relevant action.

SECTION 10.05. REGULATIONS. 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
Debt Securities, in regard to proof of the holding of Debt 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
think fit. Except as otherwise permitted or required by any such
regulation, the holding of Debt Securities shall be proved in the
manner specified in Section 9.02 and the appointment of any proxy
shall be proved in the manner specified in said Section 9.02 or by
having the signature of the Person executing the proxy witnessed or
guaranteed by any bank, broker or trust company.

The Trustee shall, by an instrument in writing, appoint a
temporary chairman of the meeting, unless the meeting shall have been
called by the Company or by Holders of Debt Securities as provided in

<PAGE> 125

Section 10.03, in which case the Company or such Holders of Debt
Securities, as the case may be, shall in like manner appoint a
temporary chairman. A permanent chairman and a secretary of the
meeting shall be elected by vote of the Holders of a majority in
aggregate principal amount of the Debt Securities represented at the
meeting and entitled to vote.

Subject to the provisions of Section 9.04, at any meeting
each Holder of a Debt Security of a series entitled to vote at such
meeting or proxy shall be entitled to one vote for each $1,000
principal amount of Debt Securities of such series held or represented
by him; provided, however, that no vote shall be cast or counted at
any meeting in respect of any Debt 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 Debt Securities of such series or proxy
therefor. Any meeting of Holders of Debt Securities duly called
pursuant to the provisions of Section 10.02 or 10.03 may be adjourned
from time to time and the meeting may be held as so adjourned without
further notice.

At any meeting of Holders of Debt Securities, the presence
of Persons holding or representing Debt Securities in an aggregate
principal amount sufficient to take action upon the business for the
transaction of which such meeting was called shall be necessary to
constitute a quorum; but, if less than quorum be present, the Persons
holding or representing a majority of the Debt Securities represented
at the meeting may adjourn such meeting with the same effect, for all
intents and purposes, as though a quorum had been present.

SECTION 10.06. VOTING. The vote upon any resolution
submitted to any meeting of Holders of Debt Securities shall be by
written ballots on which shall be subscribed the signatures of the
holders of Debt Securities entitled to vote at such meeting or of
their representatives by proxy, and the letter or letters, serial
number or numbers or other distinguishing marks of the Debt Securities
held or represented by him. 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 in duplicate
of the proceedings of each meeting of Holders of Debt 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 mailed as
provided in Section 10.02. The record shall be signed and verified by
the affidavits of the permanent chairman and secretary of the meeting
and one of the duplicates shall be delivered to the Company and the
other to the Trustee to be preserved by the Trustee, the latter to
have attached thereto the ballots voted at the meeting.

<PAGE> 126

Any record so signed and verified shall be conclusive
evidence of the matters therein stated.

SECTION 10.07. NO DELAY OF RIGHTS BY MEETING. Nothing in
this Article Ten contained shall be deemed or construed to authorize
or permit, by reason of any call of a meeting of Holders of Debt
Securities of any or all series or any rights expressly or impliedly
conferred hereunder to make such call, any hindrance or delay in the
exercise of any right or rights conferred upon or reserved to the
Trustee or to the Holders of Debt Securities under any of the
provisions of this Indenture or of the Debt Securities.

ARTICLE ELEVEN.

SUPPLEMENTAL INDENTURES.

SECTION 11.01 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF
HOLDERS. The Company, when authorized by a Board Resolution, and the
Trustee may from time to time and at any time enter into an indenture
or indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act of 1939 as in force at the date
of the execution thereof) for one or more of the following purposes:

(a) to evidence the succession of another
corporation to the Company, or successive successions,
and the assumption by the successor corporation of the
covenants, agreements and obligations of the Company
pursuant to Articles Five and Twelve hereof;

(b) to add to the covenants of the Company such
further covenants, restrictions, conditions or
provisions as the Board of Directors and the Trustee
shall consider to be for the protection of the Holders
of Debt Securities of any or all series, and to make
the occurrence, or the occurrence and continuance, of a
default in any of such additional covenants,
restrictions, conditions or provisions a default or an
Event of Default with respect to such series
permitting the enforcement of all or any of the several
remedies provided in this Indenture as herein set
forth; provided, however, that in respect of any such
additional covenant, restriction or condition, such
supplemental indenture may provide for a particular
period of grace after default (which period may be
shorter or longer than that allowed in the case of
other defaults) or may provide for an immediate
enforcement upon such default or may limit the remedies
available to the Trustee upon such default;

(c) to cure any ambiguity or to correct or
supplement any provision contained herein or in any
supplemental indenture which may be defective or
inconsistent with any other provision contained herein

<PAGE> 127

or in any supplemental indenture; to convey, transfer,
assign, mortgage or pledge any property to or with the
Trustee; or to make such other provisions in regard to
matters or questions arising under this Indenture as
shall not adversely affect the interests of the Holders
of the Debt Securities;

(d) to secure the Debt Securities of all series
in accordance with the provisions of Sections 5.05;

(e) to evidence and provide for the acceptance of
appointment by another corporation as a successor
Trustee hereunder with respect to one or more series of
Debt Securities and to add to or change any of the
provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the
trusts hereunder by more than one Trustee, pursuant to
Section 8.11;

(f) to modify, amend or supplement this Indenture
in such a manner as to permit the qualification of any
indenture supplemental hereto under the Trust Indenture
Act of 1939 as then in effect, except that nothing
herein contained shall permit or authorize the
inclusion in any indenture supplemental hereto of the
provisions referred to in Section 316(a)(2) of the
Trust Indenture Act of 1939;

(g) to provide for the issuance under this
Indenture of Debt Securities in coupon form (including
Debt Securities registrable as to principal only) and
to provide for exchangeability of such Debt Securities
with Debt Securities of the same series issued
hereunder in fully registered form and to make all
appropriate changes for such purpose;

(h) to change or eliminate any of the provisions
of this Indenture, provided, however, that any such
change or elimination shall become effective only when
there is no Debt Security Outstanding of any series
created prior to the execution of such supplemental
indenture which is entitled to the benefit of such
provision; or

(i) to establish any additional form of Debt
Security, as permitted by Section 2.02, and to provide
for the issuance of any additional series of Debt
Securities, as permitted by Section 3.01, and to set
forth the terms thereof.

The Trustee is hereby required to join with the Company in
the execution of any such supplemental indenture, to make any further
appropriate agreements and stipulations which may be therein contained

<PAGE> 128

and to accept the conveyance, transfer, assignment, mortgage or pledge
of any property thereunder, but the Trustee 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.

Any supplemental indenture authorized by the provisions of
this Section 11.01 may be executed by the Company and the Trustee
without the consent of the Holders of any of the Debt Securities at
the time Outstanding, notwithstanding any of the provisions of Section
11.02.

SECTION 11.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF
HOLDERS. With the consent (evidenced as provided in Section 9.01) of
the Holders of greater than 50% in aggregate principal amount of the
Outstanding Debt Securities of each series affected by such
supplemental indenture (all such Holders voting as a single class), by
act of said Holders delivered to the Company and the Trustee, the
Company, when authorized by a Board Resolution, and the Trustee may
from time to time and at any time 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 any supplemental indenture or of
modifying in any manner the rights of the Holders of the Debt
Securities of each series under this Indenture; provided, however,
that no such supplemental indenture shall (i) without the consent of
the Holder of each Outstanding Debt Security affected thereby, extend
the fixed maturity of any Debt Security, or reduce the rate or extend
the time of payment of interest thereon, or reduce the principal
amount thereof or any premium thereon, or make the principal thereof
or interest or premium thereon payable in any coin or currency other
than that provided in the Debt Securities or (ii) without the consent
of the Holders of all of the Outstanding Debt Securities of each
series affected reduce the aforesaid percentage of Debt Securities,
the Holders of which are required to consent (a) to any such
supplemental indenture, (b) to rescind and annul a declaration that
any Debt Securities are due and payable as a result of the occurrence
of an Event of Default, (c) to waive any past default under the
Indenture and its consequences and (d) to waive compliance with
Sections 5.02 and 5.04 (other than 5.04(a)(1) and (2)) to 5.07,
inclusive.

Upon the request of the Company, accompanied by a copy of a
Board Resolution certified by its Secretary or Assistant Secretary
authorizing the execution of any such supplemental indenture, and upon
the filing with the Trustee of evidence of the consent of Holders of
Debt Securities as aforesaid, the Trustee shall join with the Company
in the execution of such supplemental indenture unless such
supplemental indenture affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the
Trustee may in its discretion, but shall not be obligated to, enter
into such supplemental indenture.

<PAGE> 129

It shall not be necessary for the consent of the Holders of
Debt Securities under this Section 11.02 to approve the particular
form of any proposed supplemental indenture, but it shall be
sufficient if such consent shall approve the substance thereof.

SECTION 11.03. EFFECT OF SUPPLEMENTAL INDENTURES. Upon the
execution of any supplemental indenture pursuant to the provisions of
this Article Eleven, this Indenture shall be and be deemed to be
modified and amended in accordance therewith and the respective
rights, limitation of rights, obligations, duties and immunities under
this Indenture of the Trustee, the Company and the Holders of Debt
Securities shall thereafter be determined, exercised and enforced
hereunder subject in all respects to such modifications and amendments
and all the terms and conditions of any such supplemental indenture
shall be and be deemed to be part of the terms and conditions of this
Indenture for any and all purposes.

SECTION 11.04. NOTATION ON DEBT SECURITIES. Debt Securities
authenticated and delivered after the execution of any supplemental
indenture pursuant to the provisions of this Article Eleven may bear a
notation in form approved by the Trustee as to any matter provided for
in such supplemental indenture. If the Company or the Trustee shall
so determine, new Debt Securities of any series so modified as to
conform, in the opinion of the Trustee and the Board of Directors to
any modification of this Indenture contained in any such supplemental
indenture may be prepared and executed by the Company, authenticated
by the Trustee and delivered in exchange for the Outstanding Debt
Securities of such series.

SECTION 11.05. EVIDENCE OF COMPLIANCE OF SUPPLEMENTAL
INDENTURE TO BE FURNISHED TRUSTEE. The Trustee, subject to the
provisions of Sections 8.01 and 7.02, shall receive, and shall be
fully protected in relying upon, an Officer's Certificate and an
Opinion of Counsel as conclusive evidence that any supplemental
indenture executed pursuant hereto complies with the requirements of
this Article Eleven and is authorized and permitted by this Indenture.

ARTICLE TWELVE.

CONSOLIDATION, MERGER, SALE AND CONVEYANCE.

SECTION 12.01. COMPANY MAY CONSOLIDATE, ETC., on Certain
Terms. Nothing contained in this Indenture or in any of the Debt
Securities shall prevent any consolidation or merger of the Company
with or into any other corporation or corporations (whether or not
affiliated with the Company), or successive consolidations or mergers
in which the Company or its successor or successors shall be a party
or parties, or shall prevent any sale, conveyance or lease of all or
substantially all of the property of the Company to any other
corporation (whether or not affiliated with the Company) authorized to
acquire and operate the same; provided, however, and the Company
hereby covenants and agrees, that any such consolidation, merger,
sale, conveyance or lease shall be upon the condition that (a)

<PAGE> 130

immediately after such consolidation, merger, sale, conveyance or
lease the corporation (whether the Company or such other corporation)
formed by or surviving any such consolidation or merger, or to which
such sale, conveyance or lease shall have been made, shall not be in
default in the performance or observance of any of the terms,
covenants and conditions of this Indenture to be kept or performed by
the Company; (b) the corporation (if other than the Company) formed by
or surviving any such consolidation or merger or to which such sale,
conveyance or lease shall have been made, shall be a corporation
organized under the laws of the United States of America or any state
thereof; and (c) the due and punctual payment of the principal of and
premium, if any, and interest on all of the Debt Securities, according
to their tenor, and the due and punctual performance and observance of
all of the covenants and conditions of this Indenture to be performed
or observed by the Company, shall be expressly assumed, by
supplemental indenture satisfactory in form to the Trustee, executed
and delivered to the Trustee by the Corporation (if other than the
Company) formed by such consolidation, or into which the Company shall
have been merged, or by the corporation which shall have acquired or
leased such property.

SECTION 12.02. SUCCESSOR CORPORATION TO BE SUBSTITUTED. In
case of any such consolidation, merger, sale, conveyance or lease and
upon the assumption by the successor corporation, by supplemental
indenture, executed and delivered to the Trustee and satisfactory in
form to the Trustee, of the due and punctual payment of the principal
of and premium, if any, and interest on all of the Debt Securities and
the due and punctual performance and observance of all of the
covenants and conditions of this Indenture to performed or observed by
the Company, such successor corporation shall succeed to and be
substituted for the Company, with the same effect as if it had been
named herein as the party of the first part, and (except in the event
of a conveyance by way of lease) the predecessor corporation shall be
relieved of any further obligation under this Indenture and the Debt
Securities. Such successor corporation thereupon may cause to be
signed, and may issue either in its own name or in the name of Morton
International, Inc. any or all of the Debt Securities issuable
hereunder which theretofore shall not have been signed by the Company
and delivered to the Trustee; and, upon the order of such successor
corporation instead of the Company and subject to all the terms,
conditions and limitations in this Indenture prescribed, the Trustee
shall authenticate and shall deliver any Debt Securities which
previously shall have been signed and delivered by the officers of the
Company to the Trustee for authentication, and any Debt Securities
which such successor corporation thereafter shall cause to be signed
and delivered to the Trustee for that purpose. All the Debt
Securities of each series so issued shall in all respects have the
same legal rank and benefit under this Indenture as the Debt
Securities of such series theretofore or thereafter issued in
accordance with the terms of this Indenture as though all of such Debt
Securities had been issued at the date of the execution hereof.

<PAGE> 131

In case of any such consolidation, merger, sale, conveyance
or lease such changes in phraseology and form (but not in substance)
may be made in the Debt Securities thereafter to be issued as may be
appropriate.

SECTION 12.03. OPINION OF COUNSEL TO BE GIVEN TRUSTEE. The
Trustee, subject to Sections 8.01 and 8.02, shall receive an Opinion
of Counsel as conclusive evidence that any such consolidation, merger,
sale or conveyance and any such assumption complies with the
provisions of this Article Twelve and that all conditions precedent
herein provided relating to such transactions have been complied with.

ARTICLE THIRTEEN.

SATISFACTION AND DISCHARGE OF INDENTURE.

SECTION 13.01. SATISFACTION, DISCHARGE AND DEFEASANCE OF
DEBT SECURITIES OF ANY SERIES. The Company shall be deemed to have
paid and discharged the entire indebtedness on all the Debt Securities
of a series, the provisions of this Indenture (except as to (x) the
rights of Holders of Debt Securities of such series to receive, from
the money, in the currency required, and Government Obligations
deposited with the Trustee pursuant to Section 13.03 or the interest
and principal received by the Trustee in respect of such Government
Obligations, payment of the principal of (and premium, if any) and any
installment of principal of (and premium, if any) or interest on such
Debt Securities on the Stated Maturities thereof or upon the
Redemption Dates for Debt Securities required to be redeemed pursuant
to any mandatory sinking fund or analogous provisions relating to Debt
Securities of that series or pursuant to any call for redemption
relating to Debt Securities of that series, (y) the Company's rights
and obligations with respect to such Debt Securities under Sections
3.06, 3.07, 5.02, 5.04, 6.01, 8.06, 8.10, 8.11, 13.03, 13.04 and, to
the extent applicable to such series, Article Four, so long as the
principal of (and premium, if any) and interest on the Debt Securities
of such series remain unpaid and, thereafter, only the Company's
rights and obligations under Sections 8.06, 13.03 and 13.04, and (z)
the rights, powers, trusts, duties and immunities of the Trustee with
respect to the Debt Securities of such series) as it relates to such
Debt Securities shall no longer be in effect, and the Trustee, at the
expense of the Company, shall, upon Company Request, execute proper
instruments acknowledging the same if:

(a) (1) all Debt Securities of such series
theretofore authenticated and delivered (other than (i)
Debt Securities which have been destroyed, lost or
stolen and which have been replaced or paid as provided
in Section 3.07 and (ii) Debt 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 Sections 13.03 and 13.04)
have been delivered to the Trustee for cancellation;

<PAGE> 132

(2) the Company has paid or caused to be paid in
the currency required all other sums payable under this
Indenture in respect of the Debt Securities of such
series; 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 of the entire
indebtedness of all Debt Securities of any such series
and the discharge of the Indenture as it relates to
such Debt Securities have been complied with; or

(b) (1) all Debt Securities of such series not
theretofore delivered to the Trustee for cancellation
(i) have become due and payable, or (ii) will become
due and payable at their Stated Maturity within one
year, or (iii) are to be called for redemption within
one year under arrangements satisfactory to the Trustee
for the giving of notice of redemption by the Trustee
in the name, and at the expense of the Company;

(2) the condition described in paragraph (1) of
Section 13.02 has been satisfied; and

(3) the conditions described in paragraphs (a)(2)
and (a)(3) of this Section 13.01 have been satisfied;
or

(2) no Event of Default or event which with
notice or lapse of time would become an Event of
Default shall have occurred and be continuing on the
date of the deposit referred to in paragraph (1) of
Section 13.02 or on the ninety- first day after the
date of such deposit; provided, however, that should
that condition fail to be satisfied on or before such
ninety-first day, the Trustee shall promptly, upon
satisfactory receipt of evidence of such failure,
return such deposit to the Company;

(3) the Company has either (i) delivered to the
Trustee an opinion of counsel of a nationally-
recognized independent tax counsel to the effect that
Holders of the Debt Securities of such series will not
recognize income, gain or loss for Federal income tax
purposes as a result of such deposit and the
satisfaction, discharge and defeasance contemplated by
this paragraph (c) of this Section 13.01 and will be
subject to Federal income tax on the same amounts and

<PAGE> 133

in the same manner and at the same times as would have
been the case if such deposit and defeasance had not
occurred or (ii) the Company shall have received from,
or there shall have been published by, the
United States Internal Revenue Service a ruling to the
effect stated in (i) of this Section 13.01(c)(3); and

(4) the Company has received an Opinion of
Counsel to the effect that the satisfaction, discharge
and defeasance contemplated by this Section 13.01 will
not result in the delisting of the Debt Securities of
that series from any nationally-recognized securities
exchange on which they are listed (if any).

SECTION 13.02. DEFEASANCE OF DEBT SECURITIES OF ANY SERIES.
The provisions of this Indenture (except as to (x) the rights of
Holders of Debt Securities of any series to receive, from the money,
in the currency required, and Government Obligations deposited with
the Trustee pursuant to paragraph (1) below or the interest and
principal received by the Trustee in respect of such Government
Obligations, payment of the principal of (and premium, if any) and any
installment of principal of (and premium, if any) or interest on such
Debt Securities on the Stated Maturities thereof or upon the
Redemption Dates for Debt Securities required to be redeemed pursuant
to any mandatory sinking or analogous provisions relating to
Securities of that series or pursuant to any call for redemption
relating to Debt Securities of that series, (y) the Company's rights
and obligations with respect to such Debt Securities under Sections
3.06, 3.07, Article Seven (other than subsections (d), (e) and (h) of
Section 7.01), Sections 5.01, 5.02, 5.04, 6.01, 8.06, 8.10, 8.11,
13.03, 13.04 and, to the extent applicable to such series, Article
Four, so long as the principal of (and premium, if any) and interest
on the Debt Securities of such series remain unpaid and, thereafter,
only the Company's rights and obligations under Sections 5.04, 8.06,
13.03 and 13.04, and (z) the rights, powers, trusts, duties and
immunities of the Trustee with respect to the Debt Securities of such
series) as it relates to Debt Securities of any series shall no longer
be in effect, and the Trustee, at the expense of the Company shall,
upon Company Request, execute proper instruments acknowledging the
same if:

(1) the Company has deposited or caused to be
deposited with the Trustee as trust funds in trust for
the purpose (A) the Dollars or Foreign Currency, as
applicable, in an amount, or (B) Government Obligations
which through the payment of interest and principal in
respect thereof in accordance with their terms will
provide on or before the due date of any payment in
respect of such series of Debt Securities in an amount,
or (C) a combination thereof, sufficient, after payment
of all Federal, state and local taxes in respect
thereof payable by the Trustee, in the opinion of a
nationally-recognized firm of independent public

<PAGE> 134

accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge
(i) the principal of (and premium, if any) and each
installment of principal (and premium, if any) and
interest on the Outstanding Debt Securities of that
series on the Stated Maturity of such principal or
installment of principal or interest and (ii) any
mandatory sinking fund payments or analogous payments
or payments pursuant to any call for redemption
applicable to Debt Securities of such series on the day
on which such payments are due and payable in
accordance with the terms of the Indenture and such
Debt Securities;

(2) no Event of Default or event which with
notice or lapse of time would become an Event of
Default shall have occurred and be continuing on the
date of such deposit;

(3) the interest of the Holders in such deposit
shall have been duly perfected under the applicable
provisions of the Uniform Commercial Code; and

(4) 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 defeasance contemplated by this
Section have been complied with.

SECTION 13.03. APPLICATION OF TRUST FUNDS; INDEMNIFICATION.
(a) Subject to the provisions of Section 13.04, all money and
Government Obligations deposited with the Trustee pursuant to Section
13.01 or 13.02 and all money received by the Trustee in respect of
Government Obligations deposited with the Trustee, shall be held in
trust and applied by it, in accordance with the provisions of the Debt
Securities and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as its own
Paying Agent) as the Trustee may determine, to the Persons entitled
thereto, of the principal (and premium, if any) and interest for whose
payment such money and Government Obligations have been deposited with
or received by the Trustee as contemplated by Section 13.01 or 13.02.

(b) The Company shall pay and shall indemnify the Trustee
against any tax, fee or other charge imposed on or assessed against
Government Obligations deposited pursuant to Section 13.01 or 13.02 or
the interest and principal received in respect of such obligations,
other than any such tax, fee or other charge payable by or on behalf
of Holders. The Company shall be entitled to prompt notice of an
assessment or the commencement of any proceeding for which
indemnification may be sought hereunder and, at its election, to
contest such assessment or to participate in, assume the defense of,
or settle such proceeding.

<PAGE> 135

(c) The Trustee shall deliver or pay to the Company from
time to time upon Company Request any Government Obligations or money
held by it as provided in Section 13.01 or 13.02 which, in the opinion
of a nationally-recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee,
are then in excess of the amount thereof which then would have been
required to be deposited for the purpose for which such obligations or
money were deposited or received.

(d) If the Trustee is unable to apply any money or
Government Obligations in accordance with Section 13.02 by reason of
any legal proceeding or by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise
prohibiting such application, the Company's obligations under this
Indenture and the Debt Securities, if any, of such series shall be
revived and reinstated as though no deposit had occurred pursuant to
Section 13.02 until such time as the Trustee is permitted to apply all
such money or Government Obligations in accordance with Section 13.02;
provided, however, that if the Company has made any payment of
interest on or principal of (and premium, if any) on any Debt
Securities, if any, of such series because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of the
Holders of such series of Debt Securities, if any, to receive such
payment from the money or Government Obligations held by the Trustee.

SECTION 13.04. RETURN OF UNCLAIMED MONEYS. Any moneys
deposited with or paid to the Trustee or any Paying Agent for payment
of the principal of and premium, if any, or interest on Debt
Securities and not applied but remaining unclaimed by the Holders of
Debt Securities for two years after the date upon which the principal
of and premium, if any, or interest on such Debt Securities, as the
case may be, shall have become due and payable, shall be repaid to the
Company by the Trustee or such Paying Agent on demand; and the Holder
of any of the Debt Securities entitled to receive such payment shall
thereafter look only to the Company for any payment thereof.

ARTICLE FOURTEEN.

IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS.

SECTION 14.01. INDENTURE AND DEBT SECURITIES SOLELY
CORPORATE OBLIGATIONS. No recourse under or upon any obligation,
covenant or agreement of this Indenture, any supplemental indenture,
or of any Debt Security, or for any claim based thereon or otherwise
in respect thereof, shall be had against any incorporator,
stockholder, officer, director or employee, as such, past, present or
future, of the Company or any Subsidiary or of any predecessor or
successor corporation, either directly or through the Company, 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 this Indenture and the obligations issued
hereunder are solely corporate obligations, and that no such personal

<PAGE> 136

liability whatever shall attach to, or is or shall be incurred by, the
incorporators, stockholders, officers, directors or employees, as
such, of the Company or of any predecessor or successor corporation,
or any of them, because of the creation of the indebtedness hereby
authorized, or under or by reason of the obligations, covenants or
agreements contained in this Indenture, or in any of the Debt
Securities or implied thereby; and that any and all such personal
liability, either at common law or in equity or by constitution or
statute of, and any and all such rights and claims against, every such
incorporator, stockholder, officer, director or employee, as such,
because of the creation of the indebtedness hereby authorized, or
under or by reason of the obligations, covenants or agreements
contained in this Indenture or in any of the Debt Securities or
implied thereby, are hereby expressly waived and released as a
condition of, and as a consideration for, the execution of this
Indenture and the issue of such Debt Securities.

ARTICLE FIFTEEN.

MISCELLANEOUS PROVISIONS.

SECTION 15.01. PROVISIONS BINDING ON SUCCESSORS OF THE
COMPANY. All of the covenants, stipulations, promises and agreements
in this Indenture contained by the Company shall bind its successors
and assigns whether so expressed or not.

SECTION 15.02. INDENTURE FOR SOLE BENEFIT OF PARTIES AND
HOLDERS OF DEBT SECURITIES. Nothing in this Indenture or in the Debt
Securities, expressed or implied, shall give or be construed to give
to any Person, firm or corporation, other than the parties hereto, any
agent of the Trustee or the Company under this Indenture and the
Holders of the Debt Securities, any legal or equitable right, remedy
or claim under or in respect of this Indenture, or under any covenant,
condition or provision herein contained; all such covenants,
conditions and provisions being, subject to the provisions of Articles
Twelve and Fourteen, for the sole benefit of the parties hereto, any
agent of the Trustee or the Company under this Indenture and the
Holders of the Debt Securities.

SECTION 15.03. ADDRESSES FOR NOTICES, ETC. Any notice or
demand which by any provision of this Indenture is required or
permitted to be given or served by the Trustee or by the Holders of
Debt Securities on the Company may be given or served by being
deposited, registered or certified mail postage prepaid, in a post
office letter box in the United States addressed (until another
address is filed by the Company with the Trustee) to the Company, 100
N. Riverside Plaza, Chicago, Illinois 60606-1596, Attention:
Corporate Secretary. Any notice, direction, request or demand by any
Holder of a Debt Security or the Company to or upon the Trustee shall
be deemed to have been sufficiently given or made, for all purposes,
if given or made in writing at the Principal Office of the Trustee,
addressed to the attention of its Corporate Trust Services Division.
Any notice, report or other instrument required by any of the

<PAGE> 137

provisions of this Indenture to be given by the Trustee to the Holders
of Debt Securities of any or all series shall be deemed to have been
sufficiently given, for all purposes, when mailed by first class mail.

SECTION 15.04. GOVERNING LAW. This Indenture and the Debt
Securities shall for all purposes be construed in accordance with and
governed by the laws of the State of Illinois.

SECTION 15.05. EVIDENCE OF COMPLIANCE WITH CONDITIONS
PRECEDENT; DELIVERY OF DOCUMENTS TO TRUSTEE. Upon any Company Request
to the Trustee to take any action under any of the provisions of this
Indenture, the Company shall furnish to the Trustee an Officers'
Certificate stating that all conditions precedent, if any (including
any covenant, compliance with which constitutes a condition
precedent), 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 (insofar
as they relate to matters of law) have been complied with, except that
in the case of any such application or demand as to which the
furnishing of such document is specifically required by any provision
of this Indenture relating to such particular application or demand,
no additional certificate or opinion need be furnished.

Each certificate or opinion provided for in this Indenture
and delivered to the Trustee with respect to compliance with a
condition or covenant provided for in this Indenture shall include (1)
a statement that the Person making such certificate or opinion has
read such covenant or condition; (2) a brief statement as to the
nature and scope of the examination or investigation upon which the
statements or opinions contained in such certificate or opinion are
based; (3) a statement that, in the opinion of such Person, he 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 or
not, in the opinion of such Person, such condition or covenant has
been complied with.

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

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

<PAGE> 138

to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company unless such
counsel knows 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 15.06. LEGAL HOLIDAYS. In any case where the date
of maturity of interest on or principal of or premium, if any, on any
series of Debt Securities or the date fixed for redemption of any Debt
Security or Debt Securities will be a legal holiday or a day on which
banking institutions are legally authorized or obligated to close in
Chicago, Illinois or any other location where a Paying Agent appointed
pursuant to Section 5.02 is located, then payment of such interest on
or principal of and premium, if any, on such Debt Securities need not
be made by such Paying Agent on such date but may be made by such
Paying Agent on the next succeeding business day that is not a day in
such location that is either a legal holiday or a day on which banking
institutions are legally authorized or obligated to close, with the
same force and effect as if made on such date of maturity or the date
fixed for redemption and no interest shall accrue for the period from
and after such prior date.

SECTION 15.07. TRUST INDENTURE ACT OF 1939 TO CONTROL. If
any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act of 1939 that is required under such Act to
be a part of and govern this Indenture, the provisions of such Act
shall control. If any provision of this Indenture modifies or
excludes any provision of the Trust Indenture Act of 1939 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.

SECTION 15.08. TABLE OF CONTENTS, HEADINGS, ETC. The table
of contents and the titles and headings of the articles and sections
of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.

SECTION 15.09. DETERMINATION OF PRINCIPAL AMOUNT. In
determining whether the Holders of the requisite principal amount of
Outstanding Debt Securities of any series have given any request,
demand, authorization, direction, notice, consent or waiver hereunder,
or whether sufficient funds are available for redemption or for any
other purpose, (i) the principal amount of an Original Issue Discount
Debt Security that shall be deemed to be Outstanding for such purposes
shall be the amount of the principal thereof that would be due and
payable as of the date of such determination upon a declaration of
acceleration of the maturity thereof pursuant to Section 7.01, (ii)
the principal amount of any Debt Securities denominated in a Foreign

<PAGE> 139

Currency that shall be deemed to be Outstanding for such purposes
shall be determined by converting the Foreign Currency into Dollars at
the Market Exchange Rate as of the date of such determination and
(iii) the principal amount of any Indexed Debt Security that shall be
deemed to be Outstanding for such purposes shall be the amount of the
principal face amount of such Indexed Debt Security at original
issuance, unless otherwise provided in or pursuant to this Indenture.

SECTION 15.10. EXECUTION IN COUNTERPARTS; ACCEPTANCE OF
TRUSTS. This Indenture may be executed in any number of counterparts,
each of which shall be an original and such counterparts shall
together constitute but one and the same instrument. The First
National Bank of Chicago hereby accepts the trusts in this Indenture
declared and provided, upon the terms and conditions hereinabove set
forth.

<PAGE> 140

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

MORTON INTERNATIONAL, INC.

By: ___________________________________
Name: ______________________________
Title: ______________________________

ATTEST:

By: ___________________________________
Name: ______________________________
Title: ______________________________

THE FIRST NATIONAL BANK OF CHICAGO
as Trustee

By: ___________________________________
Name: ______________________________
Title: ______________________________

ATTEST:

By: ___________________________________
Name: ______________________________
Title: ______________________________

<PAGE> 141

STATE OF ILLINOIS )
) SS:
COUNTY OF COOK )

On the _____ day of _______________, 1998, before me
personally came ____________________ and ____________________, to me
known, who, being by me duly sworn, did depose and say that they are
the _____________ and _______________, respectively, of Morton
International, Inc., one of the parties described in and which
executed the foregoing instrument; that they signed their names
thereto by authority of the Board of Directors of said corporation;
and said they acknowledged said instrument to be their free act and
deed and the free act and deed of said corporation.

WITNESS my hand and official seal the day and year first
above written.

___________________________________
Notary Public

(NOTARIAL SEAL) My commission expires:________

<PAGE> 142

STATE OF ILLINOIS )
) SS.:
COUNTY OF COOK )

On this _____ day of _______________, 1998, before me
personally came ____________________, to me known, who, being by me
duly sworn, did depose and say that he is a __________________________
of The First National Bank of Chicago, one of the parties described in
and which executed the foregoing instrument; and that he signed his
name thereto by due authority of said party; and said person
acknowledged said instrument to be his free act and deed and the free
act and deed of said party.

WITNESS my hand and official seal the day and year first
above written.

___________________________________
Notary Public

(NOTARIAL SEAL) My commission expires:________

EXHIBIT 5

Opinion of Schiff Hardin & Waite
--------------------------------

May 1, 1998

Morton International, Inc.
100 North Riverside Plaza
Chicago, Illinois 60606-1596

Re: Morton International, Inc.
Registration Statement on Form S-3
----------------------------------

Gentlemen:

We have acted as counsel to Morton International, Inc., an
Indiana corporation (the "Company"), in connection with the filing of
a Registration Statement on Form S-3 (the "Registration Statement")
with the Securities and Exchange Commission pursuant to the Securities
Act of 1933, as amended (the "Act"). The Registration Statement
relates to the registration under the Act of up to $1,000,000,000 of
the Company's debt securities, consisting of debentures, notes or
other evidences of indebtedness in one or more series ("Debt
Securities").

The Debt Securities are to be issued under an indenture
between the Company and The First National Bank of Chicago, as trustee
(the "Trustee") substantially in the form filed as an exhibit to the
Registration Statement (the "Indenture"). The Debt Securities may be
offered and sold pursuant to one or more underwriting agreements
(each, together with any related pricing agreement or other schedule
of terms, an "Underwriting Agreement") between the Company and the
underwriters named therein, or as otherwise provided pursuant to the
Registration Statement.

In this regard, we have reviewed the Registration Statement
and the exhibits thereto and have examined such other documents and
made such investigation as we have deemed necessary in order to enable
us to render the opinions set forth below. In rendering such
opinions, we have assumed that (i) the Registration Statement will
have become effective under the Act and the Indenture will have been
qualified under the Trust Indenture Act of 1939, as amended, (ii) a
Prospectus Supplement (a "Prospectus Supplement") relating to the Debt
Securities to be offered and sold as contemplated by the Registration
Statement will be prepared, delivered and filed as contemplated by the

<PAGE> 144

Morton International, Inc.
May 1, 1998
Page 2

Act, (iii) the Indenture will have been authorized, executed and
delivered by each of the Company and the Trustee, in substantially the
form filed as an exhibit to the Registration Statement, (iv) the
Indenture will represent the valid and binding obligation of the
Trustee, (v) each Underwriting Agreement, as applicable, will be
executed and delivered in substantially the form filed as an exhibit
to the Registration Statement, and (vi) each Underwriting Agreement
will be authorized, executed and delivered by or on behalf of the
underwriters named therein and will represent a valid and binding
obligation of each such underwriter.

Based on the foregoing, we are of the opinion that:

1. The Company is validly existing under the laws of the State
of Indiana.

2. The Debt Securities will be valid and binding obligations of
the Company, enforceable in accordance with their terms (except as
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other laws relating to or affecting
enforcement of creditors' rights generally or by general equity
principles and except that a claim in respect of any Debt Security
denominated other than U.S. dollars may be converted into U.S. dollars
at a rate of exchange prevailing at a date determined by applicable
law and enforcement thereof may be further limited by governmental
authority to limit, delay or prohibit the making of payments in a
foreign currency or currency unit on payment outside the United
States) at such time as: (a) the Board of Directors of the Company or
a duly authorized committee thereof (the "Board of Directors") shall
have established by resolution, not inconsistent with the Indenture, a
series in which such Debt Securities are to be issued and the terms of
such Debt Securities, and such series and terms shall have been
established in accordance with the requirements of the Indenture; and
(b) the issuance and sale of such Debt Securities shall have been duly
authorized by the Board of Directors, and such Debt Securities shall
have been duly executed, authenticated, issued and delivered pursuant
to the provisions of the Indenture and, if applicable, in accordance
with a duly authorized, completed and executed Underwriting Agreement,
as contemplated in the Registration Statement and the applicable
Prospectus Supplement, against payment of the agreed consideration
therefor.

The opinions expressed above are limited to the laws of the
State of Illinois, the Indiana Business Corporation Law and the
federal laws of the United States.

<PAGE> 145

Morton International, Inc.
May 1, 1998
Page 3

We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement and to the use of our name under
the caption "Legal Opinions" in the prospectus constituting a part of
the Registration Statement.

Very truly yours,

SCHIFF HARDIN & WAITE

By: /s/ Andrew A. Kling
-------------------

EXHIBIT 12

Statement Regarding Computation of Ratios
-----------------------------------------

Six Months
----------

FY98 FY97 FY97 FY96 FY95 FY94 FY93
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Income from Continuing Operations 175.6 149.8 333.8 285.3 243.6 193.4 119.5
before taxes

Fixed Charges
-------------

Interest Expense 11.6 12.0 25.6 24.4 28.4 27.8 33.5
Amortization of debt expense and 0.1 0.1 0.1 0.1 0.1 0.1 0.1
discount or premium relating to
debt

Portion of rent expense 5.8 6.6 11.6 11.9 11.2 11.1 10.6
demonstrated to represent the
interest factor @

Preferred stock dividend -- -- -- -- -- -- --
---- ---- ---- ---- ---- ---- ----

Total Fixed Charges 17.5 18.7 37.3 36.4 39.7 39.0 44.2
Pretax income plus fixed charges 193.1 168.5 371.1 321.7 283.3 232.4 163.7

Ratio 11.0 9.0 9.9 8.8 7.1 6.0 3.7
==== ==== ==== ==== ==== ==== ====

Rent Expense 17.6 19.9 35.2 36.1 34.0 33.6 32.1
Interest factor 0.33 0.33 0.33 0.33 0.33 0.33 0.33

Interest portion of rent 5.8 6.6 11.6 11.9 11.2 11.1 10.6
==== ==== ==== ==== ==== ==== ====

</TABLE>

Six Month rent amounts are estimates based on FY97 expense.

EXHIBIT 23.2

CONSENT OF ERNST & YOUNG LLP
----------------------------

Consent of Independent Auditors

We consent to the reference to our firm under the caption
"Experts" in the Registration Statement (Form S-3) and related
Prospectus of Morton International, Inc. for the registration of
$1,000,000,000 of debt securities and to the incorporation by
reference therein of our reports dated July 29, 1997, with respect to
the consolidated financial statements of Morton International, Inc.
incorporated by reference in its Annual Report (Form 10-K) for the
year ended June 30, 1997, and the related financial statement schedule
included therein, filed with the Securities and Exchange Commission.

ERNST & YOUNG LLP

Chicago, Illinois
April 29, 1998

EXHIBIT 25

Statement of Eligibility of
The First National Bank of Chicago on Form T-1
----------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM T-1
--------

STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE

CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

____________________________

THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)

A National Banking Association 36-0899825
(I.R.S. employer
identification number)

One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)

The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)

_____________________________

Morton International, Inc.
(Exact name of obligor as specified in its charter)

Indiana 36-4140798
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification
number)

100 North Riverside Plaza
Chicago, Illinois 60606-1596
(Address of principal executive offices) (Zip Code)

Debt Securities
(Title of Indenture Securities)

<PAGE> 149

ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING
INFORMATION AS TO THE TRUSTEE:

(a) Name and address of each examining or
supervising authority to which it is subject.

Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.

(B) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.

The trustee is authorized to exercise corporate
trust powers.

ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.

No such affiliation exists with the trustee.

ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
PART OF THIS STATEMENT OF ELIGIBILITY.

1. A copy of the articles of association of the
trustee now in effect.*

2. A copy of the certificates of authority of the
trustee to commence business.*

3. A copy of the authorization of the trustee to
exercise corporate trust powers.*

4. A copy of the existing by-laws of the trustee.*

5. Not Applicable.

6. The consent of the trustee required by
Section 321(b) of the Act.

7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.

8. Not Applicable.

9. Not Applicable.

<PAGE> 150

Pursuant to the requirements of the Trust Indenture Act of 1939,
as amended, the trustee, The First National Bank of Chicago, a
national banking association organized and existing under the laws of
the United States of America, has duly caused this Statement of
Eligibility to be signed on its behalf by the undersigned, thereunto
duly authorized, all in the City of Chicago and the State of Illinois,
on this 2nd day of April, 1998.

THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE

By /s/ John R. Prendiville
John R. Prendiville
Vice President

* EXHIBIT 1, 2, 3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO
EXHIBITS BEARING IDENTICAL NUMBERS IN ITEM 16 OF THE FORM T-1 OF THE
FIRST NATIONAL BANK OF CHICAGO, FILED AS EXHIBIT 25.1 TO THE
REGISTRATION STATEMENT ON FORM S-3 OF SUNAMERICA, INC., FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 25, 1996 (REGISTRATION
NO. 333-14201).

<PAGE> 151

EXHIBIT 6

THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT

April 2, 1998

Securities and Exchange Commission
Washington, D.C. 20549

Gentlemen:

In connection with the qualification of an indenture between
Morton International, Inc. and The First National Bank of Chicago, the
undersigned, in accordance with Section 321(b) of the Trust Indenture
Act of 1939, as amended, hereby consents that the reports of
examinations of the undersigned, made by Federal or State authorities
authorized to make such examinations, may be furnished by such
authorities to the Securities and Exchange Commission upon its request
therefor.

Very truly yours,

THE FIRST NATIONAL BANK OF CHICAGO

By /s/ John R. Prendiville
John R. Prendiville
Vice President

<PAGE> 152

EXHIBIT 7
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 12/31/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>

CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR DECEMBER 31,1997

All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding as of the last business day of
the quarter.

SCHEDULE RC--BALANCE SHEET
Dollar Amounts in
Thousands RCFC BIL MIL THOU
--------- ---- ------------
<S> <C> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions
(from Schedule RC-A):
a. Noninterest-bearing balances and currency and 0081 4,267,336 1.a.
coin(1)
b. Interest-bearing balances(2) 0071 6,893,837 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, 1754 0 2.a.
column A)
b. Available-for-sale securities (from Schedule RC-B, 1773 5,691,722 2.b.
column D)............
3. Federal funds sold and securities purchased under 1350 6,339,940 3.
agreements to resell
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from RCFD 2122 25,202,984 4.a.
Schedule RC-C)
b. LESS: Allowance for loan and lease losses RCFD 3123 419,121 4.b.
c. LESS: Allocated transfer risk reserve RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, 2125 24,783,863 4.d.
allowance, and reserve (item 4.a minus 4.b and
4.c)
5. Trading assets (from Schedule RD-D) 3545 6,703,332 5.
6. Premises and fixed assets (including capitalized 2145 743,426 6.
leases)
7. Other real estate owned (from Schedule RC-M) 2150 7,727 7.
8. Investments in unconsolidated subsidiaries and 2130 134,959 8.
associated companies (from Schedule RC-M)
9. Customers' liability to this bank on acceptances 2155 644,340 9.
outstanding
10. Intangible assets (from Schedule RC-M) 2143 268,501 10.
11. Other assets (from Schedule RC-F) 2160 2,004,432 11.
12. Total assets (sum of items 1 through 11) 2170 58,483,415 12.

</TABLE>
_____________

(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.

<PAGE> 153

<S> <C> <C> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 09/30/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>

SCHEDULE RC-CONTINUED

Dollar Amounts in
Thousands RCFC BIL MIL THOU
--------- ---- ------------
<S> <C> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A RCON 2200 21,756,846 13.a
and C from Schedule RC-E, part 1)
(1) Noninterest-bearing(1) RCON 6631 9,197,227 13.a.1
(2) Interest-bearing RCON 6636 559,619 13.a.2
b. In foreign offices, Edge and Agreement RCFN 2200 14,811,410 13.b.
subsidiaries, and IBFs (from Schedule RC-E,
part II)
(1) Noninterest bearing RCFN 6631 332,801 13.b.1
(2) Interest-bearing RCFN 6636 14,478,609 13.b.2
14. Federal funds purchased and securities sold under RCFD 2800 4,535,422 14
agreements to repurchase:
15. a. Demand notes issued to the U.S. Treasury RCON 2840 43,763 15.a
b. Trading Liabilities(from Schedule RC-D) RCFD 3548 6,523,239 15.b
16. Other borrowed money:
a. With a remaining maturity of one year or less RCFD 2332 1,360,165 16.a
b. With a remaining maturity of than one year A547 576,492 16.b
through three years
c. With a remaining maturity of more than three A548 703,981 16.c
years
17. Not applicable
18. Bank's liability on acceptance executed and RCFD 2920 644,341 18
outstanding
19. Subordinated notes and debentures (2) RCFD 3200 1,700,000 19
20. Other liabilities (from Schedule RC-G) RCFD 2930 1,322,077 20
21. Total liabilities (sum of items 13 through 20) RCFD 2948 53,987,736 21
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus RCFD 3838 0 23
24. Common stock RCFD 3230 200,858 24
25. Surplus (exclude all surplus related to preferred RCFD 3839 2,999,001 25
stock)
26. a. Undivided profits and capital reserves RCFD 3632 1,273,239 26.a.
b. Net unrealized holding gains (losses) on RCFD 8434 24,096 26.b.
available-for-sale securities
27. Cumulative foreign currency translation adjustments RCFD 3284 (1,515) 27
28. Total equity capital (sum of items 23 through 27) RCFD 3210 4,495,679 28
29. Total liabilities and equity capital (sum of items RCFD 3300 58,483,415 29
21 and 28)
RCFD 6724 N/A M.1

</TABLE>

<PAGE> 154

Memorandum
<S> <C>
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for
the bank by independent external auditors as of any
date during 1996 . . . . . . . . . . . . . . . . .

1 = Independent audit of the bank conducted in 4 = Directors' examination of the bank performed by
accordance with generally accepted auditing other external auditors (may be required by state
standards by a certified public accounting firm chartering authority)
which submits a report on the bank 5 = Review of the bank's financial statements by
2 = Independent audit of the bank's parent holding external auditors
company conducted in accordance with generally 6 = Compilation of the bank's financial statements by
accepted auditing standards by a certified public external auditors
accounting firm which submits a report on the 7 = Other audit procedures (excluding tax preparation
consolidated holding company (but not on the bank work)
separately) 8 = No external audit work
3 = Directors' examination of the bank conducted in
accordance with generally accepted auditing
standards by a certified public accounting firm (may
be required by state chartering authority)

____________________

(1) Includes total demand deposits and noninterest-bearing time and savings deposits.
(2) Includes limited-life preferred stock and related surplus.

</TABLE>