HILTON HOTELS CORP, S-3, 1996-12-23

HILTON HOTELS CORP
S-3, 1996-12-23
HOTELS & MOTELS

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<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 23, 1996
REGISTRATION NO. 333-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
HILTON HOTELS CORPORATION
(Exact name of registrant as specified in its charter)

<TABLE>
<S> <C>
DELAWARE 36-2058176
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>

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

9336 CIVIC CENTER DRIVE
BEVERLY HILLS, CALIFORNIA 90210
(310) 278-4321
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
--------------------------

WILLIAM C. LEBO, JR.
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
HILTON HOTELS CORPORATION
9336 CIVIC CENTER DRIVE
BEVERLY HILLS, CALIFORNIA 90210
(310) 278-4321

(Name, address, including zip code, and telephone number, including area code,
of agent for service)
--------------------------
COPIES TO:

<TABLE>
<CAPTION>
Brian G. Cartwright Nicholas P. Saggese
<S> <C>
Latham & Watkins Skadden, Arps, Slate, Meagher & Flom, LLP
633 West Fifth Street, Suite 4000 300 South Grand Avenue, Suite 3400
Los Angeles, California 90071 Los Angeles, California 90071
(213) 485-1234 (213) 687-5000
</TABLE>

--------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration
Statement as determined by market conditions.
--------------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, 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 (the "Securities Act"), other than securities offered only in connection
with dividend or interest investment 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, please 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. /X/
--------------------------

CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED OFFERING PRICE(1) REGISTRATION FEE(2)
<S> <C> <C>
Debt Securities, Preferred Stock, $1.00 par value, Depositary Shares, Common
Stock, $2.50 par value, and Warrants......................................... $1,000,000,000 $303,031
Series A Junior Participating Preferred Stock Purchase Rights ("Rights")(3).... * *
</TABLE>

(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(o) of the rules and regulations under the Securities Act. Rule
457(o) permits the registration fee to be calculated on the basis of the
maximum offering price of all of the securities listed and, therefore, the
table does not specify by each class information as to the amount to be
registered, the proposed maximum offering price per unit or the proposed
maximum aggregate offering price.

(2) Amount calculated pursuant to Section 6(b) under the Securities Act.

(3) The Rights are initially carried and traded with the Common Stock. The value
attributable to the Rights, if any, is reflected in the value of the Common
Stock.
--------------------------

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 OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
SUBJECT TO COMPLETION, PRELIMINARY PROSPECTUS DATED DECEMBER 23, 1996
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 OR 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.
<PAGE>
PROSPECTUS

$1,000,000,000

[LOGO]

DEBT SECURITIES, PREFERRED STOCK
DEPOSITARY SHARES, COMMON STOCK AND WARRANTS
------------------

Hilton Hotels Corporation, a Delaware Corporation (the "Company" or
"Hilton"), may offer from time to time in one or more series (i) its debt
securities consisting of debentures, notes or other evidences of indebtedness
(the "Debt Securities"), (ii) shares or fractional shares of its preferred
stock, par value $1.00 per share (the "Preferred Stock"), (iii) shares of its
Preferred Stock represented by depositary shares (the "Depositary Shares"), (iv)
shares of its common stock, par value $2.50 per share (the "Common Stock"), or
(iv) warrants to purchase Common Stock, Preferred Stock, Depositary Shares or
Debt Securities (the "Warrants"), with an aggregate public offering price of up
to $1,000,000,000 (or the equivalent if the securities are denominated in
foreign currency or foreign currency units). The Debt Securities, Preferred
Stock, Depositary Shares, Common Stock and Warrants (collectively, the "Offered
Securities") may be offered, separately or together, in one or more separate
classes or series and in amounts, at prices and on terms to be determined at the
time of offering and to be set forth in one or more supplements to this
Prospectus (each, a "Prospectus Supplement").

The specific terms of the Offered Securities in respect of which this
Prospectus is being delivered will be set forth in the applicable Prospectus
Supplement and will include, where applicable: (i) in the case of Debt
Securities, the specific designation, aggregate principal amount, designated
currency (or currency unit), purchase price, maturity, interest rate (or manner
of calculation thereof), time of payment of interest (if any), terms (if any)
for the subordination, redemption or conversion thereof, and any other specific
terms of the Debt Securities; (ii) in the case of Preferred Stock, the specific
designation, number of shares, liquidation preference, purchase price, dividend,
voting, redemption and conversion provisions and any other specific terms of the
Preferred Stock; (iii) in the case of Depositary Shares, the aggregate number of
shares offered, the fractional share of Preferred Stock represented by each such
Depositary Share and the purchase price; (iv) in the case of Common Stock, the
number of shares, purchase price and terms of the offering and sale thereof; and
(v) in the case of Warrants, the specific designation, number, duration,
purchase price, exercise price, detachability and any other terms in connection
with the offering, sale and exercise of the Warrants, as well as the terms on
which and the securities for which such Warrants may be exercised.

The applicable Prospectus Supplement will also contain information, where
applicable, about certain material United States Federal income tax
considerations relating to, and any listing on a securities exchange of, the
Offered Securities covered by such Prospectus Supplement.
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.
NONE OF THE NEVADA GAMING COMMISSION, THE NEVADA STATE GAMING CONTROL BOARD,
THE NEW JERSEY CASINO CONTROL COMMISSION NOR THE REGULATORY AUTHORITY OF
ANY OTHER STATE HAS PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS OR THE INVESTMENT MERITS OF THE SECURITIES OFFERED
HEREBY. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.

THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON OR ENDORSED THE
MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE
CONTRARY IS UNLAWFUL.
------------------------

The Offered Securities may be offered to or through underwriters, dealers or
agents designated from time to time, as set forth in the applicable Prospectus
Supplement, and may be offered to other purchasers directly by the Company.
Certain terms of the offering and sale of Offered Securities, including, where
applicable, the names of any underwriters, dealers or agents, any applicable
commissions, discounts and other items constituting compensation of such
underwriters, dealers or agents, and the proceeds to the Company from such sale,
will be set forth in the accompanying Prospectus Supplement. See "Plan of
Distribution" for possible indemnification arrangements for underwriters,
dealers and agents.

No Offered Securities may be sold without delivery of the applicable
Prospectus Supplement describing the method and terms of the offering of the
Offered Securities.
------------------------

THE DATE OF THIS PROSPECTUS IS DECEMBER , 1996
<PAGE>
No person has been authorized to give any information or to make any
representations in connection with this offering other than those contained or
incorporated by reference in this Prospectus and any accompanying Prospectus
Supplement in connection with the offering described herein and therein, and, if
given or made, such information or representations must not be relied upon as
having been authorized by the Company or by any underwriter, dealer or agent.
Neither this Prospectus nor any Prospectus Supplement shall constitute an offer
to sell or a solicitation of an offer to buy Offered Securities in any
jurisdiction in which it is unlawful for such person to make such an offering or
solicitation. Neither the delivery of this Prospectus or any Prospectus
Supplement nor any sale made hereunder shall under any circumstances imply that
the information contained or incorporated by reference herein or in any
Prospectus Supplement is correct as of any date subsequent to the date hereof or
of such Prospectus Supplement.

IN CONNECTION WITH THE OFFERING OF CERTAIN OFFERED SECURITIES, THE
UNDERWRITERS FOR SUCH OFFERING MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH
STABILIZE OR MAINTAIN THE MARKET PRICES OF SUCH SECURITIES OR OTHER SECURITIES
OF THE COMPANY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE, IN THE
OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.

AVAILABLE INFORMATION

The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement on Form S-3 (including all amendments
thereto, the "Registration Statement") under the Securities Act of 1933, as
amended (the "Securities Act"), with respect to the Offered Securities. This
Prospectus and any Prospectus Supplement do not contain all of the information
set forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. For further
information with respect to the Company and the Offered Securities, reference is
hereby made to the Registration Statement and the exhibits and schedules
thereto. Any statements contained herein concerning the provisions of any
document filed as an exhibit to the Registration Statement or otherwise filed
with the Commission are not necessarily complete, and in each instance reference
is made to the copy of such document so filed. Each such statement is qualified
in its entirety by such reference.

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, registration statements and other
information with the Commission. Such reports, proxy statements, registration
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 located at Seven World Trade Center, 13th Floor,
New York, New York 10048, and at 500 West Madison Street, Room 1400, Chicago,
Illinois 60661. Copies of such materials can be obtained at prescribed rates
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549. The Commission also maintains a site on the World Wide
Web at http://www.sec.gov which contains reports and other information regarding
registrants that file electronically with the Commission. Certain securities of
the Company are listed on the New York Stock Exchange and the Pacific Stock
Exchange. Reports, proxy statements and other information concerning the Company
can also be inspected and copied at the offices of the New York Stock Exchange,
20 Broad Street, New York, New York 10005 and the Pacific Stock Exchange, 301
Pine Street, San Francisco, California 94104, and 618 South Spring Street, Los
Angeles, California 90014.

2
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The following documents, which the Company has filed with the Commission
pursuant to the Exchange Act, are hereby incorporated by reference in, and shall
be deemed to be a part of, this Prospectus.

(a) Annual Report on Form 10-K for the fiscal year ended December 31,
1995 (the "Form 10-K");

(b) Quarterly Reports on Form 10-Q for the quarters ended March 31,
1996, June 30, 1996 and September 30, 1996;

(c) Amended Quarterly Report on Form 10-Q/A for the quarter ended March
31, 1996 filed with the Commission on May 7, 1996;

(d) Current Reports on Form 8-K dated June 6, 1996, August 29, 1996,
September 19, 1996 and December 20, 1996;

(e) Description of the Company's Common Stock included in a Registration
Statement on Form 8-A filed with the Commission on May 18, 1986;

(f) Description of the Rights included in a Registration Statement on
Form 8-A filed with the Commission on July 22, 1988; and

(g) Description of the Company's Preferred Redeemable Increased Dividend
Equity Securities, 8% PRIDES, Convertible Preferred Stock included in a
Registration Statement on Form 8-A filed with the Commission on November 25,
1996.

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

This Prospectus incorporates documents by reference which are not presented
herein or delivered herewith. The Company will provide without charge to any
person to whom this Prospectus is delivered, on the written or oral request of
such person, a copy of any or all of the foregoing documents incorporated herein
by reference (other than exhibits to such documents unless such exhibits are
specifically incorporated by reference therein). Requests should be directed to
the attention of Cheryl L. Marsh, Vice President and Corporate Secretary, Hilton
Hotels Corporation, 9336 Civic Center Drive, Beverly Hills, California 90210
(telephone number (310) 278-4321).

3
<PAGE>
THE COMPANY

The Company is a leading owner and operator of full service hotels and
hotel-casinos in the United States. The Hilton name is one of the best
recognized and most respected lodging brands in the world. The Company owns,
leases and operates major lodging and gaming properties in gateway cities, urban
and suburban centers and resort areas.

On December 18, 1996, Hilton consummated a merger with Bally Entertainment
Corporation ("Bally"), pursuant to which Bally was merged with and into Hilton
(the "Merger"), with Hilton surviving the Merger. Pursuant to the Merger, Hilton
acquired Bally's interests in casinos and casino hotel resorts, including
Bally's Park Place Casino - Resort and The Grand casino hotel resort in Atlantic
City, New Jersey; Bally's Las Vegas casino hotel resort in Las Vegas, Nevada;
Bally's Casino -STAR- Lakeshore Resort, a riverboat casino on Lake Pontchartrain
in New Orleans, Louisiana; and Bally's Saloon -STAR-Gambling Hall -STAR- Hotel,
a dockside casino and hotel in Robinsonville, Mississippi near Memphis,
Tennessee.

The Company's executive offices are located at 9336 Civic Center Drive,
Beverly Hills, California 90210, and its telephone number is (310) 278-4321.

USE OF PROCEEDS

Except as otherwise set forth in the accompanying Prospectus Supplement, the
Company intends to use the net proceeds from the sale of the Offered Securities
for general corporate purposes, which may include the repayment, redemption or
repurchase of existing indebtedness, additions to working capital, the
acquisition of, or investment in, new or existing properties and the financing
of capital expenditures. Funds not required immediately for such purposes may be
invested temporarily in short-term investment grade securities.

4
<PAGE>
RATIOS OF EARNINGS TO FIXED CHARGES

The following table sets forth the Company's unaudited ratios of earnings to
fixed charges for the periods indicated.

<TABLE>
<CAPTION>
NINE MONTHS
ENDED SEPTEMBER 30,
YEARS ENDED DECEMBER 31,
- ----------------------------------------------------- --------------------
1991 1992 1993 1994 1995 1995 1996
- --------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
2.6 2.9 2.7 2.8 3.2 2.8 4.2

</TABLE>

The ratio of earnings to fixed charges is calculated by dividing (i) income
before income taxes and minority interest plus fixed charges (adjusted for
capitalized interest) by (ii) fixed charges. Fixed charges consist of interest
incurred (expensed or capitalized) and the portion of rent expense which is
deemed representative of interest.

DESCRIPTION OF DEBT SECURITIES

The following sets forth certain general terms and provisions of the
Indenture (as defined below) under which the Debt Securities are to be issued.
The particular terms of the Debt Securities will be set forth in a Prospectus
Supplement relating to such Debt Securities.

The Debt Securities offered hereby will be issued under one or more
indentures, each dated as of a date on or before the issuance of the Debt
Securities to which it relates and in the form that has been filed as an exhibit
to the Registration Statement of which this Prospectus is a part, subject to
such amendments or supplements as may be adopted from time to time. Each such
indenture (the "Indenture") will be entered into between the Company, as
obligor, and a trustee chosen by the Company (the "Trustee") and qualified to
act as such under the Trust Indenture Act of 1939, as amended (the "TIA"). The
following summary of certain provisions of the Indenture does not purport to be
complete and is subject to, and is qualified in its entirety by reference to,
all provisions of the Indenture, including the definitions therein of certain
terms which are not otherwise defined in this Prospectus. The terms of the
Indenture are also governed by certain provisions contained in the TIA. Certain
capitalized terms used below but not defined herein have the meanings ascribed
to them in the Indenture.

GENERAL

The Debt Securities will be direct obligations of the Company, which may be
secured or unsecured, and which may be senior or subordinated indebtedness of
the Company. The Indenture provides that the Debt Securities may be issued
without limit as to aggregate principal amount, in one or more series, in each
case as established from time to time in or pursuant to authority granted by a
Board Resolution or as established in one or more indentures supplemental to the
Indenture. All Debt Securities of one series need not be issued at the same time
and, unless otherwise provided, a series may be reopened, without the consent of
the holders of the Debt Securities of such series, for issuances of additional
Debt Securities of such series.

The Indenture provides that there may be more than one Trustee thereunder,
each with respect to one or more series of Debt Securities. Any Trustee under
the Indenture may resign or be removed with respect to one or more series of
Debt Securities, and a successor Trustee may be appointed to act with respect to
such series. In the event that two or more persons are acting as Trustees with
respect to different series of Debt Securities, each such Trustee shall be a
Trustee of a trust under the Indenture separate and apart from the trust
administered by any other Trustee thereunder, and, except as otherwise indicated
herein, any action described herein to be taken by the Trustee may be taken by
each such Trustee with respect to, and only with respect to, the one or more
series of Debt Securities for which it is Trustee under the Indenture.

5
<PAGE>
Reference is made to the Prospectus Supplement relating to the series of
Debt Securities being offered for the specific terms thereof, including:

(1) The title of such Debt Securities;

(2) The aggregate principal amount of such Debt Securities and any
limit on such aggregate principal amount;

(3) The percentage of the principal amount at which such Debt
Securities will be issued and, if other than the principal amount thereof,
the portion of the principal amount thereof payable upon declaration of
acceleration of the maturity or upon redemption thereof and the rate or
rates at which original issue discount ("OID") will accrue;

(4) The date or dates on which the principal of such Debt Securities
will be payable (or the method by which such date or dates will be
determined);

(5) The rate or rates (which may be fixed or variable) and, if
applicable, the method used to determine the rate, at which such Debt
Securities will bear interest, if any, the date or dates from which such
interest will accrue, and the circumstances, if any, in which the Company
may defer interest payments, the dates on which such interest shall be
payable and the record date for the interest payable on any interest payment
date;

(6) The place or places where principal of, premium, if any, and
interest on such Debt Securities will be payable (or the method of such
payment), and such Debt Securities may be surrendered for conversion or
registration of transfer or exchange;

(7) The obligation, if any, of the Company to redeem or purchase such
Debt Securities pursuant to any sinking fund or analogous provisions or at
the option of a holder thereof and the right, if any, of the Company to
redeem such Debt Securities and the period or periods within which, the
price or prices at which, and the terms and conditions upon which, such Debt
Securities may be redeemed;

(8) The denominations in which such Debt Securities are issuable, if
other than denominations of $1,000 and any integral multiple thereof;

(9) Whether such Debt Securities are to be issued at a discount and
the portion of the principal amount of such Debt Securities that shall be
payable upon acceleration, if other than the principal amount thereof;

(10) Provisions, if any, for the defeasance or discharge of certain of
the Company's obligations with respect to such Debt Securities, which
provisions may be in addition to, in substitution for, or in modification of
(or any combination of the foregoing), the provisions of the Indenture;

(11) Whether such Debt Securities will be in registered or bearer form;

(12) The currency or currencies in which payment of principal of and
interest on such Debt Securities will be made;

(13) If payments of principal of, premium, if any, or interest on the
Debt Securities are to be made in currency other than the denominated
currency, the manner in which the exchange rate with respect to such
payments will be determined;

(14) The manner in which the amounts of payment of principal of,
premium, if any, or interest on such Debt Securities will be determined, if
such amounts may be determined by reference to an index based on a currency
or currencies other than that in which such Debt Securities are denominated
or designated to be payable or by reference to a commodity, commodity index,
stock exchange index or financial index;

6
<PAGE>
(15) Any addition to, or modification or deletion of, any Events of
Default or covenants set forth in the Indenture;

(16) A discussion of any material and/or special United States Federal
income tax considerations applicable to such Debt Securities;

(17) Any depositaries, trustees, interest rate calculation agents,
exchange rate calculation agents or other agents with respect to the Debt
Securities other than those originally appointed;

(18) Whether such Debt Securities will be issued in the form of one or
more global securities and whether such global securities are to be issuable
in a temporary global form or permanent global form;

(19) Any rights of the holders of Debt Securities to convert the Debt
Securities into other securities or property of the Company and, if so, the
terms and conditions, which may be in addition to or in lieu of the
provisions contained in the Indenture, upon which such Debt Securities will
be convertible;

(20) The terms, if any, on which such Debt Securities will be
subordinate to other debt of the Company;

(21) Any listing of the Debt Securities on a securities exchange;

(22) The provisions, if any, relating to any security provided for such
Debt Securities; and

(23) Any other terms of such Debt Securities, which other terms will
not be inconsistent with the provisions of the Indenture.

The Debt Securities may be sold at a discount below their principal amount.
Even if the Debt Securities are not issued at a discount below their principal
amount, such securities may, for United States Federal income tax purposes, be
deemed to have been issued with OID because of certain interest payment
characteristics. Special United States Federal income tax considerations
applicable to Debt Securities issued with OID will be described in more detail
in any applicable Prospectus Supplement. In addition, special United States
Federal tax considerations or other restrictions or terms applicable to any Debt
Securities issuable in bearer form, offered exclusively to foreigners, or
denominated in a currency other than United States dollars will be set forth in
a Prospectus Supplement relating thereto.

MERGER, CONSOLIDATION OR SALE OF ASSETS

The Indenture provides that the Company may not consolidate or merge with or
into, or sell, assign, convey, transfer or lease its properties and assets
substantially in their entirety (computed on a consolidated basis) to, another
corporation, person or entity unless (i) either (a) in the case of a merger or
consolidation, the Company is the surviving person or (b) the successor or
transferee is a corporation organized under the laws of the United States, any
state thereof or the District of Columbia and expressly assumes, by supplemental
indenture, all the obligations of the Company under the Debt Securities and the
Indenture, and (ii) immediately after such transaction no Default or Event of
Default shall exist.

DENOMINATIONS, REGISTRATION AND TRANSFER

Unless specified in the Prospectus Supplement, the Debt Securities of any
series shall be issuable only as Registered Securities in denominations of
$1,000, and any integral multiple thereof, and shall be payable only in U.S.
dollars. The Indenture also provides that Debt Securities of a series may be
issuable in global form. See "Global Securities."

Unless otherwise indicated in the Prospectus Supplement, Bearer Securities
(other than in global form) will have Coupons attached.

7
<PAGE>
Registered Securities of any series will be exchangeable for other
Registered Securities of the same series of like aggregate principal amount and
of like Stated Maturity and with like terms and conditions. If so specified in
the applicable Prospectus Supplement, at the option of the holder thereof, to
the extent permitted by law, any Bearer Security of any series which by its
terms is registrable as to principal and interest may be exchanged for a
Registered Security of such series of like aggregate principal amount and of a
like Stated Maturity and with like terms and conditions, upon surrender of such
Bearer Security at the corporate trust office of the applicable Trustee or at
any other office or agency of the Company designated for the purpose of making
any such exchanges. Subject to certain exceptions, any Bearer Security issued
with Coupons surrendered for exchange must be surrendered with all unmatured
Coupons and any matured Coupons in default attached thereto.

Notwithstanding the foregoing, the exchange of Bearer Securities for
Registered Securities will be subject to the provisions of United States Federal
income tax laws and regulations applicable to Debt Securities in effect at the
time of such exchange.

Except as otherwise specified in the Prospectus Supplement, in no event may
Registered Securities including Registered Securities received in exchange for
Bearer Securities, be exchanged for Bearer Securities.

Upon surrender for registration of transfer of any Registered Security of
any series at the office or agency of the Company maintained for such purpose,
the Company shall deliver, in the name of the designated transferee, one or more
new Registered Securities of the same series of like aggregate principal amount
of such denominations as are authorized for Registered Securities of such series
and of a like Stated Maturity and with like terms and conditions. No service
charge will be made for any transfer or exchange of Debt Securities, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.

The Company shall not be required (i) to register, transfer or exchange Debt
Securities of any series during a period beginning at the opening of business 15
days before the day of the transmission of a notice of redemption of Debt
Securities of such series selected for redemption and ending at the close of
business on the day of such transmission, or (ii) to register, transfer or
exchange any Debt Security so selected for redemption in whole or in part,
except the unredeemed portion of any Debt Security being redeemed in part.

EVENTS OF DEFAULT

Events of Default defined in the Indenture with respect to Debt Securities
of any series are: (a) default in the payment of any interest upon any Debt
Security of that series when it becomes due and payable, and continuance of such
default for a period of 30 days; (b) default in the payment of principal of or
premium, if any, on any Debt Security of that series when due; (c) default in
the deposit of any sinking fund payment, when and as due in respect of any Debt
Security of that series; (d) default in the performance, or breach, of any
covenant or warranty of the Company in the Indenture (other than a covenant or
warranty that has been included in the Indenture solely for the benefit of a
series of Debt Securities other than that series), which default continues
uncured for a period of 60 days after written notice to the Company by the
applicable Trustee or to the Company and the applicable Trustee by the holders
of at least 25% in principal amount of the outstanding Debt Securities of that
series as provided in the Indenture; (e) the acceleration of the maturity of any
indebtedness of the Company (other than Non-recourse Indebtedness (as defined
below)), at any one time, in an amount in excess of the greater of (i) $25
million and (ii) 5% of Consolidated Net Tangible Assets (as defined below), if
such acceleration is not annulled within 30 days after written notice to the
Company by the Trustee and the holders of at least 25% in principal amount of
the outstanding Debt Securities of that series; and (f) certain events of
bankruptcy, insolvency or reorganization in respect of the Company. The
Prospectus Supplement may provide for any other Event of Default with respect to
Debt Securities of that particular series.

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"Non-recourse Indebtedness" means indebtedness the terms of which provide
that the lender's claim for repayment of such indebtedness is limited solely to
a claim against the property which secures such indebtedness.

"Consolidated Net Tangible Assets" means the total amount of assets
(including investments in Joint Ventures) of the Company and its subsidiaries
(less applicable depreciation, amortization and other valuation reserves) after
deducting therefrom (a) all current liabilities of the Company and its
subsidiaries (excluding (i) the current portion of long-term indebtedness, (ii)
intercompany liabilities and (iii) any liabilities which are by their terms
renewable or extendible at the option of the obligor thereon to a time more than
12 months from the time as of which the amount thereof is being computed) and
(b) all goodwill, trade names, trademarks, patents, unamortized debt discount
and any other like intangibles, all as set forth on the most recent consolidated
balance sheet of the Company and computed in accordance with generally accepted
accounting principles.

If an Event of Default with respect to Debt Securities of any series at the
time outstanding occurs and is continuing, then in every such case the
applicable Trustee or the holders of not less than 25% in principal amount of
the outstanding Debt Securities of that series may, by a notice in writing to
the Company (and to the applicable Trustee if given by the holders), declare to
be due and payable immediately the principal (or, if the Debt Securities of that
series are Discount Securities, such portion of the principal amount as may be
specified in the terms of that series) and premium, if any, of all Debt
Securities of that series. At any time after a declaration of acceleration with
respect to Debt Securities of any series has been made, but before a judgment or
decree for payment of the money due has been obtained by the applicable Trustee,
the holders of a majority in principal amount of the outstanding Debt Securities
of that series may, subject to the Company having paid or deposited with such
Trustee a sum sufficient to pay overdue interest and principal which has become
due other than by acceleration and certain other conditions, rescind and annul
such acceleration if all Events of Default, other than the non-payment of
accelerated principal and premium, if any, with respect to Debt Securities of
that series, have been cured or waived as provided in the Indenture. For
information as to waiver of defaults see the discussion set forth below under
"--Modification and Waiver." Reference is made to the Prospectus Supplement
relating to any series of Debt Securities that are Discount Securities for the
particular provisions relating to acceleration of a portion of the principal
amount of such Discount Securities upon the occurrence of an Event of Default
and the continuation thereof.

The Indenture provides that the Trustee will be under no obligation to
exercise any of its rights or powers under the Indenture at the request of any
holder of outstanding Debt Securities, unless the Trustee receives indemnity
satisfactory to it against any loss, liability or expense. Subject to certain
rights of the Trustee, the holders of a majority in 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 that series.

No holder of any Debt Security of any series will have any right to
institute any proceeding, judicial or otherwise, with respect to the Indenture
or for the appointment of a receiver or trustee, or for any remedy under the
Indenture, unless such holder shall have previously given to the applicable
Trustee written notice of a continuing Event of Default with respect to Debt
Securities of that series and the holders of at least 25% in principal amount of
the outstanding Debt Securities of that series shall have made written request,
and offered reasonable indemnity, to such Trustee to institute such proceeding
as trustee, and the Trustee shall not have received from the holders of a
majority in principal amount of the outstanding Debt Securities of that series a
direction inconsistent with such request and shall have failed to institute such
proceeding within 60 days. Notwithstanding the foregoing, the holder of any Debt
Security will have an absolute and unconditional right to receive payment of the
principal of, premium, if any, and any interest on such Debt Security on or
after the due dates expressed in such Debt Security and to institute suit for
the enforcement of any such payment.

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The Indenture requires the Company, within 120 days after the end of each
fiscal year, to furnish to the Trustee a statement as to compliance with the
Indenture. The Indenture provides that the Trustee may withhold notice to the
holders of Debt Securities of any series of any Default or Event of Default
(except in payment on any Debt Securities of such series) with respect to Debt
Securities of such series if it in good faith determines that withholding such
notice is in the interest of the holders of Debt Securities.

MODIFICATION AND WAIVER

Without prior notice to or consent of any holders, the Company and the
applicable Trustee, at any time and from time to time, may modify the Indenture
for any of the following purposes: (1) to evidence the succession of another
corporation to the rights of the Company and the assumption by such successor of
the covenants and obligations of the Company in the Indenture and in the Debt
Securities in accordance with the terms of the Indenture; (2) to add to the
covenants of the Company for the benefit of the holders of all or any series of
Debt Securities (and if such covenants are to be for the benefit of less than
all series, stating that such covenants are expressly being included solely for
the benefit of such series), or to surrender any right or power conferred in the
Indenture upon the Company; (3) to add any additional Events of Default (and if
such Events of Default are to be applicable to less than all series, stating
that such Events of Default are expressly being included solely to be applicable
to such series); (4) to add or change any of the provisions of the Indenture to
such extent as shall be necessary to permit or facilitate the issuance
thereunder of Debt Securities of any series in bearer form, registrable or not
registrable, and with or without Coupons, to permit Bearer Securities to be
issued in exchange for Registered Securities, to permit Bearer Securities to be
issued in exchange for Bearer Securities of other authorized denominations or to
permit the issuance of Debt Securities of any series in uncertificated form,
provided that any such action shall not adversely affect the interests of the
holders of Debt Securities of any series or any related Coupons in any material
respect; (5) to change or eliminate any of the provisions of the Indenture,
provided that any such change or elimination will become effective only when
there is no outstanding Debt Security issued thereunder or Coupon of any series
created prior to such modification which is entitled to the benefit of such
provision and as to which such modification would apply; (6) to secure the Debt
Securities issued thereunder or to provide that any of the Company's obligations
under the Debt Securities or the Indenture shall be guaranteed and the terms and
conditions for the release or substitution of such security or guarantee; (7) to
supplement any of the provisions of the Indenture to such extent as is necessary
to permit or facilitate the defeasance and discharge of any series of Debt
Securities, provided that any such action will not adversely affect the
interests of the holders of Debt Securities of such series or any other series
of Debt Securities issued under the Indenture or any related Coupons in any
material respect; (8) to establish the form or terms of Debt Securities and
Coupons, if any, as permitted by the Indenture; (9) to evidence and provide for
the acceptance of appointment thereunder by a successor Trustee with respect to
one or more series of Debt Securities and to add to or change any of the
provisions of the Indenture as is necessary to provide for or facilitate the
administration of the trusts thereunder by more than one Trustee; or (10) to
cure any ambiguity, to correct or supplement any provision in the Indenture
which may be defective or inconsistent with any other provision therein, to
eliminate any conflict between the terms of the Indenture and the Debt
Securities issued thereunder and the Trust Indenture Act or to make any other
provisions with respect to matters or questions arising under the Indenture
which will not be inconsistent with any provision of the Indenture; PROVIDED
such other provisions shall not adversely affect the interests of the holders of
outstanding Debt Securities or Coupons, if any, of any series created thereunder
prior to such modification in any material respect.

With the written consent of the holders of not less than a majority in
principal amount of the outstanding Debt Securities of each series affected by
such modification voting separately, the Company and the applicable Trustee may
modify the Indenture for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of the Indenture or of modifying
in any manner the rights of the holders of Debt Securities and Coupons, if any,
under the Indenture; PROVIDED, HOWEVER, that such modifications may not, without
the consent of the holder of each outstanding Debt

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Security of each series affected thereby: (i) change the Stated Maturity of any
Debt Security or reduce the principal amount thereof or the rate (or extend the
time for payment) of interest thereon or any premium payable upon the redemption
thereof, or change the Stated Maturity of or reduce the amount of any payment to
be made with respect to any Coupon, or change the coin or currency in which, any
Debt Security or any premium or the interest thereon is payable, or reduce the
amount of the principal of a Discount Security that would be due and payable
upon a declaration of acceleration of the Maturity thereof or impair the right
to institute suit for the enforcement of any such payment on or after the due
date thereof (including, in the case of redemption, on or after the Redemption
Date), or alter any redemption provisions in a manner adverse to the holders of
such Debt Securities; (ii) reduce the percentage in principal amount of the
outstanding Debt Securities, the consent of whose holders of such Debt
Securities is required for any such amendment, supplemental indenture or waiver
provided for in the Indenture; (iii) adversely affect the right of such holder
to convert any Debt Security; (iv) modify any of the waiver provisions, except
to increase any required percentage or to provide that certain other provisions
of the Indenture cannot be modified or waived without the consent of the holder
of each outstanding Debt Security affected thereby; or (v) modify any provision
described in the applicable Prospectus Supplement as requiring the consent of
each affected holder of Debt Securities.

A modification which changes or eliminates any covenant or other provision
of the Indenture with respect to one or more particular series of Debt
Securities and Coupons, if any, or which modifies the rights of the holders of
Debt Securities and Coupons of such series with respect to such covenant or
other provision, shall be deemed not to affect the rights under the Indenture of
the holders of Debt Securities and Coupons, if any, of any other series.

The Indenture provides that the holders of not less than a majority in
aggregate principal amount of the then outstanding Debt Securities of any
series, by notice to the relevant Trustee, may on behalf of the holders of the
Debt Securities of such series waive any default and its consequences under the
Indenture, except (1) a continuing default in the payment of interest on,
premium, if any, or the principal of, any such Debt Security held by a
nonconsenting holder or (2) a default in respect of a covenant or provision
hereof which cannot be modified or amended without the consent of the holder of
each outstanding Debt Security of each series affected.

DEFEASANCE OF DEBT SECURITIES OR CERTAIN COVENANTS IN CERTAIN CIRCUMSTANCES

DEFEASANCE AND DISCHARGE. The Indenture provides that the Company may be
discharged from any and all obligations in respect of the Debt Securities of any
series (except for certain obligations to pay additional amounts, if any, upon
the occurrence of certain tax, assessment or governmental charge events with
respect to payments on such Debt Securities, to register the transfer or
exchange of Debt Securities of such series, to replace stolen, lost or mutilated
Debt Securities of such series, to maintain paying agencies and to hold money
for payment in trust) upon the irrevocable deposit with the Trustee, in trust,
of money and/or government obligations that, through the payment of interest and
principal in respect thereof in accordance with their terms, will provide money
in an amount sufficient in the opinion of a nationally recognized firm of
independent public accountants to pay and discharge each installment of
principal (and premium, if any) and interest on, and any mandatory sinking fund
payments in respect of, the Debt Securities of such series on the dates such
payments are due. Such discharge may occur only if, among other things, (a) the
Company shall have delivered to the Trustee an opinion of counsel or a ruling
from the United States Internal Revenue Service (an "IRS Ruling"), in either
case to the effect that holders of the Debt Securities of such series will not
recognize income, gain or loss for United States Federal income tax purposes as
a result of such deposit, defeasance and discharge; and (b) if the Debt
Securities of such series are then listed on any national securities exchange,
the Company shall have delivered to the Trustee an opinion of counsel or other
instrument from such exchange to the effect that such discharge would not cause
said Debt Securities to be delisted.

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DEFEASANCE OF CERTAIN COVENANTS. Upon compliance with certain conditions,
the Company may omit to comply with certain restrictive covenants contained in
the Indenture (or, if provided for in the applicable Prospectus Supplement, any
other restrictive covenant relating to any series of Debt Securities provided
for in a Board Resolution or supplemental indenture which, by its terms may be
defeased pursuant to the terms of such series of Debt Securities) and any
omission to comply with such obligations shall not constitute a Default or Event
of Default with respect to any Debt Securities. The conditions include, among
others: the deposit with the Trustee of money and/or government obligations
that, through the payment of interest and principal in respect thereof in
accordance with their terms, will provide money in an amount sufficient in the
opinion of a nationally recognized firm of independent public accountants to pay
principal, premium, if any, and interest on and any mandatory sinking fund
payments in respect of the Debt Securities of such series on the dates such
payments are due; and the delivery to the Trustee of an opinion of counsel or an
IRS Ruling to the effect that the holders of the Debt Securities of such series
will not recognize income, gain or loss for United States Federal income tax
purposes as a result of such deposit and related covenant defeasance.

LIMITED LIABILITY OF CERTAIN PERSONS

The Indenture provides that no stockholder, incorporator, employee officer
or director, as such, past, present or future of the Company or any successor
corporation or any of the Company's Affiliates shall have any personal liability
in respect of the obligations of the Company under the Indenture or the Debt
Securities by reason of his, her or its status as such stockholder,
incorporator, employee officer or director.

MANDATORY DISPOSITION PURSUANT TO GAMING LAWS

The Indenture provides that each holder, by accepting any of the Debt
Securities subject thereto, shall be deemed to have agreed that if the gaming
authority of any jurisdiction of which the Company or any of its subsidiaries
conducts or proposes to conduct gaming requires that a person who is a holder or
the beneficial owner of the Debt Securities of a holder must be licensed,
qualified or found suitable under applicable gaming laws, such holder or
beneficial owner, as the case may be, shall apply for a license, qualification
or a finding of suitability within the required time period. If such person
fails to apply or become licensed or qualified or is found unsuitable, the
Company shall have the right, at its option, (i) to require such person to
dispose of its Debt Securities or beneficial interest therein within 30 days of
receipt of notice of the Company's election or such earlier date as may be
requested or prescribed by such gaming authority or (ii) to redeem such Debt
Securities at a redemption price equal to the lesser of (A) such person's cost
or (B) 100% of the principal amount thereof, plus accrued and unpaid interest,
if any, to the earlier of the redemption date or the date of the finding of
unsuitability, which may be less than 30 days following the notice of redemption
if so requested or prescribed by the applicable gaming authority. The Company
shall notify the Trustee in writing of any such redemption as soon as
practicable. The Company shall not be responsible for any costs or expenses any
such holder may incur in connection with its application for a license,
qualification or a finding of suitability.

CONVERSION RIGHTS

The terms and conditions, if any, upon which the Debt Securities are
convertible into Common Stock or Preferred Stock will be set forth in the
applicable Prospectus Supplement relating thereto. Such terms will include
whether such Debt Securities are convertible into Common Stock or Preferred
Stock, the conversion price (or manner of calculation thereof), the conversion
period, provisions as to whether conversion will be at the option of the holders
or the Company, the events requiring an adjustment of the conversion price and
provisions affecting conversion in the event of the redemption of such Debt
Securities.

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PAYMENT AND PAYING AGENTS

The Company covenants and agrees for the benefit of each series of Debt
Securities that it will duly and punctually pay the principal of (and premium,
if any) and interest on the Debt Securities in accordance with the terms of the
Debt Securities and the Indenture.

If Debt Securities of a series are issuable as Bearer Securities, the
Company will maintain or cause to be maintained (A) in the Borough of Manhattan,
the City and State of New York, an office or agency where any Registered
Securities of that series may be presented or surrendered for payment, where any
Registered Securities of that series may be surrendered for registration of
transfer, where Debt Securities of that series may be surrendered for exchange
or redemption, where notices and demands to or upon the Company in respect of
the Debt Securities of that series and the Indenture may be served and where
Bearer Securities of that series and related Coupons may be presented or
surrendered for payment in the circumstances described in the following
paragraph (and not otherwise), (B) subject to any laws or registration
applicable thereto, in a Place of Payment for that series which is located
outside the United States, an office or agency where Debt Securities of that
series and related Coupons may be presented and surrendered for payment
(including payment of any additional amounts payable on Debt Securities of that
series, if so provided in such series); provided, however, that if the Debt
Securities of that series are listed on The Stock Exchange of the United Kingdom
and the Republic of Ireland, the Luxembourg Stock Exchange or any other stock
exchange located outside the United States and such stock exchange shall so
require, the Company will maintain a Paying Agent for the Debt Securities of
that series in London, Luxembourg or any other required city located outside the
United States, as the case may be, so long as the Debt Securities of that series
are listed on such exchange, and (C) subject to any laws or regulations
applicable thereto, in a Place of Payment for that series located outside the
United States an office or agency where any Registered Securities of that series
may be surrendered for registration of transfer, where Debt Securities of that
series may be surrendered for exchange or redemption and where notices and
demands to or upon the Company in respect of the Debt Securities of that series
and the applicable Indenture may be served. The Company will give prompt written
notice to the applicable Trustee of the locations, and any change in the
locations, of such offices or agencies. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the
applicable Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the corporate trust office of the
applicable Trustee, except that Bearer Securities of that series and the related
coupons may be presented and surrendered for payment at the offices specified in
the applicable Debt Security and the Company has appointed the applicable
Trustee (or in the case of Bearer Securities, may appoint such other agent as
may be specified in the applicable Prospectus Supplement) as its agent to
receive all presentations surrenders, notices and demands.

No payment of principal, premium or interest on Bearer Securities shall be
made at any office or agency of the Company in the United States or by check
mailed to any address in the United States or by transfer to an account
maintained with a bank located in the United States; provided, however, that, if
the Debt Securities of a series are denominated and payable in U.S. dollars,
payment of principal of and any premium and interest on Debt Securities
(including any additional amounts payable on Securities of such series) of such
series, if specified in the applicable Prospectus Supplement, shall be made at
the office of the Company's Paying Agent in the Borough of Manhattan, the City
and State of New York, if (but only if) payment in U.S. dollars of the full
amount of such principal, premium, interest or additional amounts, as the case
may be, at all offices or agencies outside the United States maintained for the
purpose by the

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Company in accordance with the Indenture is illegal or effectively precluded by
exchange controls or other similar restrictions.

GLOBAL SECURITIES

The Debt Securities of a series may be issued in whole or in part in the
form of one or more global securities (the "Global Securities") that will be
deposited with, or on behalf of, a depositary (the "Depositary") identified in
the applicable Prospectus Supplement relating to such series. Global Securities
may be issued in either registered or bearer form and in either temporary or
permanent form. The specific terms of the depositary arrangement with respect to
a series of Debt Securities will be described in the applicable Prospectus
Supplement relating to such series.

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DESCRIPTION OF CAPITAL STOCK

As of December 19, 1996, the Company was authorized to issue 400,000,000
shares of Common Stock, $2.50 par value, of which 250,170,947 shares were issued
and outstanding, and 24,832,700 shares of Preferred Stock, $1.00 par value, of
which 14,832,300 shares designated as the "Preferred Redeemable Increased
Dividend Equity Securities, 8% PRIDES, Convertible Preferred Stock" (the
"PRIDES") were issued and outstanding.

The following summary does not purport to be complete and is qualified in
its entirety by reference to the applicable provisions of Delaware law and the
Company's Restated Certificate of Incorporation, as amended (the "Certificate of
Incorporation").

COMMON STOCK

Subject to such preferential rights as may be granted by the Board of
Directors of the Company (the "Board of Directors") in connection with the
future issuance of Preferred Stock, holders of shares of Common Stock are
entitled to one vote per share on all matters to be voted on by stockholders and
are entitled to receive ratably such dividends as may be declared on the Common
Stock by the Board of Directors in its discretion from funds legally available
therefor. In the event of the liquidation, dissolution or winding up of the
Company, after payment of all debts and other liabilities and any liquidation
preference of the holders of Preferred Stock, each holder of shares of Common
Stock is entitled to receive, ratably with each other holder of Common Stock,
$2.50 per share out of the net assets of the Company available for distribution
to its stockholders, and after such payment, holders of shares of Common Stock
are entitled to share ratably in all remaining assets of the Company available
for distribution. Holders of Common Stock have no subscription, redemption,
conversion or preemptive rights. Matters submitted for stockholder approval
generally require a majority vote of the shares of Common Stock present and
voting thereon. The outstanding shares of Common Stock are, and any shares of
Common Stock offered hereby will, when issued, be fully paid and nonassessable.

DELAWARE GENERAL CORPORATION LAW SECTION 203

As a corporation organized under the laws of the State of Delaware, the
Company is subject to Section 203 of the Delaware General Corporation Law (the
"DGCL"), which restricts certain business combinations between the Company and
an "interested stockholder" (in general, a stockholder owning 15% or more of the
Company's outstanding voting stock) or such stockholder's affiliates or
associates for a period of three years following the date on which the
stockholder becomes an "interested stockholder." The restrictions do not apply
if (i) prior to an interested stockholder becoming such, the Board of Directors
approves either the business combination or the transaction in which the
stockholder becomes an interested stockholder, (ii) upon consummation of the
transaction in which such stockholder becomes an interested stockholder, such
interested stockholder owns at least 85% of the voting stock of the Company
outstanding at the time the transaction commenced (excluding shares owned by
certain employee stock ownership plans and persons who are both directors and
officers of the Company), or (iii) on or subsequent to the date an interested
stockholder becomes such, the business combination is both approved by the Board
of Directors and authorized at an annual or special meeting of the Company's
stockholders (and not by written consent) by the affirmative vote of at least
66 2/3% of the outstanding voting stock not owned by the interested stockholder.

PREFERRED STOCK

Under the Certificate of Incorporation, shares of Preferred Stock may be
issued from time to time, in one or more classes or series, as authorized by the
Board of Directors, generally without the approval of the stockholders. Prior to
issuance of shares of each series, the Board of Directors is required by the
DGCL and the Certificate of Incorporation to adopt resolutions and file a
Certificate of Designations (the "Certificate of Designations") with the
Secretary of State of the State of Delaware, fixing for each such

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class or series the designations, powers, preferences and rights of the shares
of such class or series and the qualifications, limitations or restrictions
thereon, including, but not limited to, dividend rights, dividend rate or rates,
conversion rights, voting rights, rights and terms of redemption (including
sinking fund provisions), the redemption price or prices, and the liquidation
preferences as are permitted by the DGCL. The Board of Directors could authorize
the issuance of shares of Preferred Stock with terms and conditions which could
have the effect of discouraging a takeover or other transaction which holders of
some, or a majority, of such shares might believe to be in their best interests
or in which holders of some, or a majority, of such shares might receive a
premium for their shares over the then-market price of such shares.

Subject to limitations prescribed by the DGCL and the Certificate of
Incorporation and Bylaws, the Board of Directors is authorized to fix the number
of shares constituting each class or series of Preferred Stock and the
designations and powers, preferences and relative, participating, optional or
other special rights and qualifications, limitations or restrictions thereof,
including such provisions as may be desired concerning voting, redemption,
dividends, dissolution or the distribution of assets, conversion or exchange,
and such other subjects or matters as may be fixed by resolution of the Board of
Directors or duly authorized committee thereof. The Preferred Stock offered
hereby will, when issued, be fully paid and nonassessable and will not have, or
be subject to, any preemptive or similar rights.

Reference is made to the Prospectus Supplement relating to the class or
series of Preferred Stock being offered for the specific terms thereof,
including:

(1) The title and stated value of such Preferred Stock;

(2) The number of shares of such Preferred Stock offered, the
liquidation preference per share and the purchase price of such Preferred
Stock;

(3) The dividend rate(s), period(s) and/or payment date(s) or method(s)
of calculation thereof applicable to such Preferred Stock;

(4) Whether dividends shall be cumulative or non-cumulative and, if
cumulative, the date from which dividends on such Preferred Stock shall
accumulate;

(5) The procedures for any auction and remarketing, if any, for such
Preferred Stock;

(6) The provisions for a sinking fund, if any, for such Preferred
Stock;

(7) The provisions for redemption, if applicable, of such Preferred
Stock;

(8) Any listing of such Preferred Stock on any securities exchange;

(9) The terms and conditions, if applicable, upon which such Preferred
Stock will be convertible into Common Stock of the Company, including the
conversion price (or manner of calculation thereof) and conversion period;

(10) Voting rights, if any, of such Preferred Stock;

(11) Whether interests in such Preferred Stock will be represented by
Depositary Shares;

(12) A discussion of any material and/or special United States Federal
income tax considerations applicable to such Preferred Stock;

(13) The relative ranking and preferences of such Preferred Stock as to
dividend rights and rights upon liquidation, dissolution or winding up of
the affairs of the Company;

(14) Any limitations on issuance of any class or series of Preferred
Stock ranking senior to or on a parity with such series of Preferred Stock
as to dividend rights and rights upon liquidation, dissolution or winding up
of the affairs of the Company; and

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(15) Any other specific terms, preferences, rights, limitations or
restrictions of such Preferred Stock.

Unless otherwise specified in the Prospectus Supplement, the Preferred Stock
will, with respect to dividend rights and rights upon liquidation, dissolution
or winding up of the Company, rank: (i) senior to all classes or series of
Common Stock of the Company, and to all equity securities ranking junior to such
Preferred Stock with respect to dividend rights or rights upon liquidation,
dissolution or winding up of the Company; (ii) on a parity with all equity
securities issued by the Company the terms of which specifically provide that
such equity securities rank on a parity with the Preferred Stock with respect to
dividend rights or rights upon liquidation, dissolution or winding up of the
Company; and (iii) junior to all equity securities issued by the Company the
terms of which specifically provide that such equity securities rank senior to
the Preferred Stock with respect to dividend rights or rights upon liquidation,
dissolution or winding up of the Company. As used in the Certificate of
Incorporation for these purposes, the term "equity securities" does not include
convertible debt securities.

PREFERRED STOCK RIGHTS AGREEMENT

On July 14, 1988, the Company adopted a Preferred Share Purchase Rights Plan
("Rights Plan") and declared a dividend distribution of one Right on each
outstanding share of Common Stock and one Right on each share of Common Stock
issued between July 14, 1988 and the earliest of the Distribution Date, the
Redemption Date and the Final Expiration Date (as such terms are defined in the
Rights Plan). The Rights are transferable only with the Common Stock until they
become exercisable.

Generally, the Rights become exercisable only if a person or group (other
than Hilton Interests, as hereinafter defined) acquires 20% or more of the
Common Stock or announces a tender offer, the consummation of which would result
in ownership by a person or group of 20% or more of the Common Stock. Each Right
entitles stockholders to buy one one-hundredth of a share of a new series of
junior participating preferred stock at an exercise price of $150.

If the Company is acquired in a merger or other business combination
transaction, each Right entitles its holder to purchase, at the Right's then
current price, a number of the acquiring company's common shares having a then
current market value of twice the Right's exercise price. In addition, if a
person or group (other than Hilton Interests) acquires 30% or more of the
Company's outstanding Common Stock, other than pursuant to a cash tender offer
for all shares in which such person or group increases its stake from below 20%
to 80% or more of the outstanding shares of Common Stock, each Right entitles
its holder (other than such person or members of such group) to purchase, at the
Right's then current exercise price, shares of the Common Stock having a market
value of twice the Right's exercise price.

Following the acquisition by a person or group of beneficial ownership of
30% or more of the Common Stock and prior to an acquisition of 50% or more of
the Common Stock, the Company's Board of Directors may exchange the Rights
(other than Rights owned by such person or group), in whole or in part, at an
exchange ratio of one share of Common Stock (or one one-hundredth of a share of
the new series of junior participating preferred stock) per Right.

Prior to the acquisition by a person or group of beneficial ownership of 20%
or more of the Common Stock, the Rights are redeemable for one cent per Right at
the option of the Company's Board of Directors.

"Hilton Interests" refer to Barron Hilton and the Conrad N. Hilton Fund and
the shares of Common Stock beneficially owned by them.

REGISTRAR AND TRANSFER AGENT

The registrar and transfer agent for the Common Stock is ChaseMellon
Shareholder Services LLC.

17
<PAGE>
DESCRIPTION OF DEPOSITARY SHARES

GENERAL

The Company may issue receipts ("Depositary Receipts") for Depositary
Shares, each of which will represent a fractional interest of a share of a
particular series of Preferred Stock, as specified in the applicable Prospectus
Supplement. Shares of Preferred Stock of each series represented by Depositary
Shares will be deposited under a separate Deposit Agreement (each, a "Deposit
Agreement") among the Company, the depositary named therein (the "Preferred
Stock Depositary") and the holders from time to time of the Depositary Receipts.
Subject to the terms of the Deposit Agreement, each owner of a Depositary
Receipt will be entitled, in proportion to the fractional interest of a share of
a particular series of Preferred Stock represented by the Depositary Shares
evidenced by such Depositary Receipt, to all the rights and preferences of the
Preferred Stock represented by such Depositary Shares (including dividend,
voting, conversion, redemption and liquidation rights).

The Depositary Shares will be evidenced by Depositary Receipts issued
pursuant to the applicable Deposit Agreement. Immediately following the issuance
and delivery of the Preferred Stock by the Company to the Preferred Stock
Depositary, the Company will cause the Preferred Stock Depositary to issue, on
behalf of the Company, the Depositary Receipts. Copies of the applicable form of
Deposit Agreement and Depositary Receipt may be obtained from the Company upon
request, and the statements made hereunder relating to the Deposit Agreement and
the Depositary Receipts to be issued thereunder are summaries of certain
provisions thereof and do not purport to be complete and are subject to, and
qualified in their entirety by reference to, all of the provisions of the
applicable Deposit Agreement and related Depositary Receipts.

DIVIDENDS AND OTHER DISTRIBUTIONS

The Preferred Stock Depositary will distribute all cash dividends or other
cash distributions received in respect of the Preferred Stock to the record
holders of Depositary Receipts evidencing the related Depositary Shares in
proportion to the number of such Depositary Receipts owned by such holders,
subject to certain obligations of holders to file proofs, certificates and other
information and to pay certain charges and expenses to the Preferred Stock
Depositary.

In the event of a distribution other than in cash, the Preferred Stock
Depositary will distribute property received by it to the record holders of
Depositary Receipts entitled thereto, subject to certain obligations of holders
to file proofs, certificates and other information and to pay certain charges
and expenses to the Preferred Stock Depositary, unless the Preferred Stock
Depositary determines that it is not feasible to make such distribution, in
which case the Preferred Stock Depositary may, with the approval of the Company,
sell such property and distribute the net proceeds from such sale to such
holders.

No distribution will be made in respect of any Depositary Share to the
extent that it represents any Preferred Stock converted into other securities.

WITHDRAWAL OF STOCK

Upon surrender of the Depositary Receipts at the corporate trust office of
the Preferred Stock Depositary (unless the related Depositary Shares have
previously been called for redemption or converted into other securities), the
holders thereof will be entitled to delivery at such office, to or upon such
holder's order, of the number of whole or fractional shares of the Preferred
Stock and any money or other property represented by the Depositary Shares
evidenced by such Depositary Receipts. Holders of Depositary Receipts will be
entitled to receive whole or fractional shares of the related Preferred Stock on
the basis of the proportion of Preferred Stock represented by such Depositary
Share as specified in the applicable Prospectus Supplement, but holders of such
shares of Preferred Stock will not thereafter be entitled to receive Depositary
Shares therefor. If the Depositary Receipts delivered by the holder evidence a
number

18
<PAGE>
of Depositary Shares in excess of the number of Depositary Shares representing
the number of shares of Preferred Stock to be withdrawn, the Preferred Stock
Depositary will deliver to such holder at the same time a new Depositary Receipt
evidencing such excess number of Depositary Shares.

REDEMPTION OF DEPOSITARY SHARES

Whenever the Company redeems shares of Preferred Stock held by the Preferred
Stock Depositary, the Preferred Stock Depositary will redeem as of the same
redemption date the number of Depositary Shares representing shares of the
Preferred Stock so redeemed, provided the Company shall have paid in full to the
Preferred Stock Depositary the redemption price of the Preferred Stock to be
redeemed plus an amount equal to any accrued and unpaid dividends thereon to the
date fixed for redemption. The redemption price per Depositary Share will be
equal to the corresponding proportion of the redemption price and any other
amounts per share payable with respect to the Preferred Stock. If fewer than all
the Depositary Shares are to be redeemed, the Depositary Shares to be redeemed
will be selected pro rata (as nearly as may be practicable without creating
fractional Depositary Shares) or by any other equitable method determined by the
Company.

From and after the date fixed for redemption, all dividends in respect of
the shares of Preferred Stock so called for redemption will cease to accrue, the
Depositary Shares so called for redemption will no longer be deemed to be
outstanding and all rights of the holders of the Depositary Receipts evidencing
the Depositary Shares so called for redemption will cease, except the right to
receive any moneys payable upon such redemption and any money or other property
to which the holders of such Depositary Receipts were entitled upon such
redemption and surrender thereof to the Preferred Stock Depositary.

VOTING OF THE PREFERRED STOCK

Upon receipt of notice of any meeting at which the holders of the Preferred
Stock are entitled to vote, the Preferred Stock Depositary will mail the
information contained in such notice of meeting to the record holders of the
Depositary Receipts evidencing the Depositary Shares which represent such
Preferred Stock. Each record holder of Depositary Receipts evidencing Depositary
Shares on the record date (which will be the same date as the record date for
the Preferred Stock) will be entitled to instruct the Preferred Stock Depositary
as to the exercise of the voting rights pertaining to the amount of Preferred
Stock represented by such holder's Depositary Shares. The Preferred Stock
Depositary will vote the amount of Preferred Stock represented by such
Depositary Shares in accordance with such instructions, and the Company will
agree to take all reasonable action which may be deemed necessary by the
Preferred Stock Depositary in order to enable the Preferred Stock Depositary to
do so. The Preferred Stock Depositary will abstain from voting the amount of
Preferred Stock represented by such Depositary Shares to the extent it does not
receive specific instructions from the holders of Depositary Receipts evidencing
such Depositary Shares. The Preferred Stock Depositary shall not be responsible
for any failure to carry out any instruction to vote, or for the manner or
effect of any such vote made, as long as such action or non-action is in good
faith and does not result from negligence or wilful misconduct of the Preferred
Stock Depositary.

LIQUIDATION PREFERENCE

In the event of the liquidation, dissolution or winding up of the Company,
whether voluntary or involuntary, the holders of each Depositary Receipt will be
entitled to the fraction of the liquidation preference accorded each share of
Preferred Stock represented by the Depositary Shares evidenced by such
Depositary Receipt, as set forth in the applicable Prospectus Supplement.

19
<PAGE>
CONVERSION OF PREFERRED STOCK

The Depositary Shares, as such, are not convertible into Common Stock or any
other securities or property of the Company. Nevertheless, if so specified in
the applicable Prospectus Supplement relating to an offering of Depositary
Shares, the Depositary Receipts may be surrendered by holders thereof to the
Preferred Stock Depositary with written instructions to the Preferred Stock
Depositary to instruct the Company to cause conversion of the Preferred Stock
represented by the Depositary Shares evidenced by such Depositary Receipts into
whole shares of Common Stock, other shares of Preferred Stock of the Company or
other shares of stock, and the Company has agreed that upon receipt of such
instructions and any amounts payable in respect thereof, it will cause the
conversion thereof utilizing the same procedures as those provided for delivery
of Preferred Stock to effect such conversion. If the Depositary Shares evidenced
by a Depositary Receipt are to be converted in part only, a new Depositary
Receipt or Receipts will be issued for any Depositary Shares not to be
converted. No fractional shares of Common Stock will be issued upon conversion,
and if such conversion would result in a fractional share being issued, an
amount will be paid in cash by the Company equal to the value of the fractional
interest based upon the closing price of the Common Stock on the last business
day prior to the conversion.

AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT

The form of Depositary Receipt evidencing the Depositary Shares which
represent the Preferred Stock and any provision of the Deposit Agreement may at
any time be amended by agreement between the Company and the Preferred Stock
Depositary. However, any amendment that materially and adversely alters the
rights of the holders of Depositary Receipts or that would be materially and
adversely inconsistent with the rights granted to the holders of the related
Preferred Stock will not be effective unless such amendment has been approved by
the existing holders of at least 66 2/3% of the Depositary Shares evidenced by
the Depositary Receipts then outstanding. No amendment shall impair the right,
subject to certain exceptions in the Depositary Agreement, of any holder of
Depositary Receipts to surrender any Depositary Receipt with instructions to
deliver to the holder the related Preferred Stock and all money and other
property, if any, represented thereby, except in order to comply with law. Every
holder of an outstanding Depositary Receipt at the time any such amendment
becomes effective shall be deemed, by continuing to hold such Receipt, to
consent and agree to such amendment and to be bound by the Deposit Agreement as
amended thereby.

The Deposit Agreement may be terminated by the Company upon not less than 30
days' prior written notice to the Preferred Stock Depositary if a majority of
each series of Preferred Stock affected by such termination consents to such
termination, whereupon the Preferred Stock Depositary shall deliver or make
available to each holder of Depositary Receipts, upon surrender of the
Depositary Receipts held by such holder, such number of whole or fractional
shares of Preferred Stock as are represented by the Depositary Shares evidenced
by such Depositary Receipts together with any other property held by the
Preferred Stock Depositary with respect to such Depositary Receipt. In addition,
the Deposit Agreement will automatically terminate if (i) all outstanding
Depositary Shares shall have been redeemed, (ii) there shall have been a final
distribution in respect of the related Preferred Stock in connection with any
liquidation, dissolution or winding up of the Company and such distribution
shall have been distributed to the holders of Depositary Receipts evidencing the
Depositary Shares representing such Preferred Stock or (iii) each share of the
related Preferred Stock shall have been converted into securities of the Company
not so represented by Depositary Shares.

20
<PAGE>
CHARGES OF PREFERRED STOCK DEPOSITARY

The Company will pay all transfer and other taxes and governmental charges
arising solely from the existence of the Deposit Agreement. In addition, the
Company will pay the fees and expenses of the Preferred Stock Depositary in
connection with the performance of its duties under the Deposit Agreement.
However holders of Depositary Receipts will pay the fees and expenses of the
Preferred Stock Depositary for any duties requested by such holders to be
performed which are outside of those expressly provided for in the Deposit
Agreement.

RESIGNATION AND REMOVAL OF DEPOSITORY

The Preferred Stock Depositary may resign at any time by delivering to the
Company notice of its election to do so, and the Company may at any time remove
the Preferred Stock Depositary, any such resignation or removal to take effect
upon the appointment of a successor Preferred Stock Depositary. A successor
Preferred Stock Depositary must be appointed within 60 days after delivery of
the notice of resignation or removal and must be a bank or trust company having
its principal office in the United States and having a combined capital and
surplus of at least $50,000,000.

MISCELLANEOUS

The Preferred Stock Depositary will forward to holders of Depositary
Receipts any reports and communications from the Company which are received by
the Preferred Stock Depositary with respect to the related Preferred Stock.

Neither the Preferred Stock Depositary nor the Company will be liable if it
is prevented from or delayed in, by law or any circumstances beyond its control,
performing its obligations under the Deposit Agreement. The obligations of the
Company and the Preferred Stock Depositary under the Deposit Agreement will be
limited to performing their duties thereunder in good faith and without
negligence (in the case of any action or inaction in the voting of Preferred
Stock represented by the Depositary Shares), gross negligence or willful
misconduct, and the Company and the Preferred Stock Depositary will not be
obligated to prosecute or defend any legal proceeding in respect of any
Depositary Receipts, Depositary Shares or shares of Preferred Stock represented
thereby unless satisfactory indemnity is furnished. The Company and the
Preferred Stock Depositary may rely on written advice of counsel or accountants,
or information provided by persons presenting shares of Preferred Stock
represented thereby for deposit, holders of Depositary Receipts or other persons
believed in good faith to be competent to give such information, and on
documents believed in good faith to be genuine and signed by a proper party.

In the event the Preferred Stock Depositary shall receive conflicting
claims, requests or instructions from any holders of Depositary Receipts, on the
one hand, and the Company, on the other hand, the Preferred Stock Depositary
shall be entitled to act on such claims, requests or instructions received from
the Company.

DESCRIPTION OF WARRANTS

The Company may issue warrants to purchase Debt Securities (the "Debt
Warrants"), Preferred Stock (the "Preferred Stock Warrants"), Depositary Shares
(the "Depositary Shares Warrants") or Common Stock (the "Common Stock Warrants,"
collectively with the Debt Warrants, the Preferred Stock Warrants and the
Depositary Shares Warrants (the "Warrants"). Warrants may be issued
independently or together with any Offered Securities and may be attached to or
separate from such Offered Securities. The Warrants are to be issued under
warrant agreements (each a "Warrant Agreement") to be entered into between the
Company and a bank or trust company, as warrant agent (the "Warrant Agent"), all
as shall be set forth in the Prospectus Supplement relating to the Warrants
being offered pursuant thereto.

21
<PAGE>
DEBT WARRANTS

The applicable Prospectus Supplement will describe the terms of Debt
Warrants offered thereby, the Warrant Agreement relating to such Debt Warrants
and the Debt Warrant certificates representing such Debt Warrants, including the
following: (i) the title of such Debt Warrants; (ii) the aggregate number of
such Debt Warrants; (iii) the price or prices at which such Debt Warrants will
be issued; (iv) the designation, aggregate principal amount and terms of the
Debt Securities purchasable upon exercise of such Debt Warrants, and the
procedures and conditions relating to the exercise of such Debt Warrants; (v)
the designation and terms of any related Debt Securities with which such Debt
Warrants are issued, and the number of such Debt Warrants issued with each such
security; (vi) the date, if any, on and after which such Debt Warrants and the
related Debt Securities will be separately transferable; (vii) the principal
amount of Debt Securities purchasable upon exercise of each Debt Warrant, and
the price at which such principal amount of Debt Securities may be purchased
upon such exercise; (viii) the date on which the right to exercise such Debt
Warrants shall commence, and the date on which such right shall expire; (ix) the
maximum or minimum number of such Debt Warrants which may be exercised at any
time; (x) a discussion of the material United States Federal income tax
considerations applicable to the exercise of such Debt Warrants; and (xi) any
other terms of such Debt Warrants and terms, procedures and limitations relating
to the exercise of such Debt Warrants.

Debt Warrant certificates will be exchangeable for new Debt Warrant
certificates of different denominations, and Debt Warrants may be exercised at
the corporate trust office of the Warrant Agent or any other office indicated in
the applicable Prospectus Supplement. Prior to the exercise of their Debt
Warrants, holders of Debt Warrants will not have any of the rights of holders of
the securities purchasable upon such exercise and will not be entitled to
payments of principal of (or premium, if any) or interest, if any, on the
securities purchasable upon such exercise.

OTHER WARRANTS

The applicable Prospectus Supplement will describe the following terms of
Preferred Stock Warrants, Depositary Shares Warrants and Common Stock Warrants
in respect of which this Prospectus is being delivered: (i) the title of such
Warrants; (ii) the Securities for which such Warrants are exercisable; (iii) the
price or prices at which such Warrants will be issued; (iv) the number of such
Warrants issued with each share of Preferred Stock, Common Stock or Depositary
Share; (v) any provisions for adjustment of the number or amount of shares of
Preferred Stock, Common Stock or Depositary Share receivable upon exercise of
such Warrants or the exercise price of such Warrants; (vi) if applicable, the
date on and after which such Warrants and the related Preferred Stock, Common
Stock or Depositary Share will be separately transferable; (vii) if applicable,
a discussion of the material United States Federal income tax considerations
applicable to the exercise of such Warrants; (viii) any other terms of such
Warrants, including terms, procedures and limitations relating to the exchange
and exercise of such Warrants; (ix) the date on which the right to exercise such
Warrants shall commence, and the date on which such right shall expire; and (x)
the maximum or minimum number of such Warrants which may be exercised at any
time.

EXERCISE OF WARRANTS

Each Warrant will entitle the holder of Warrants to purchase for cash such
principal amount of Debt Securities or shares of Preferred Stock, Common Stock
or Depositary Share at such exercise price as shall in each case be set forth
in, or be determinable as set forth in, the Prospectus Supplement relating to
the Warrants offered thereby. Warrants may be exercised at any time up to the
close of business on the expiration date set forth in the Prospectus Supplement
relating to the Warrants offered thereby. After the close of business on the
expiration date, unexercised Warrants will become void.

Warrants may be exercised as set forth in the Prospectus Supplement relating
to the Warrants offered thereby. Upon receipt of payment and the Warrant
certificate properly completed and duly executed at the

22
<PAGE>
corporate trust office of the Warrant Agent or any other office indicated in the
Prospectus Supplement, the Company will, as soon as practicable, forward the
Debt Securities, Depositary Share or shares of Preferred Stock or Common Stock
purchasable upon such exercise. If less than all of the Warrants represented by
such Warrant certificate are exercised, a new Warrant certificate will be issued
for the remaining Warrants.

PLAN OF DISTRIBUTION

The Company may sell the Offered Securities being offered hereby: (i)
directly to purchasers; (ii) through agents; (iii) through dealers; (iv) through
underwriters; or (v) through a combination of any such methods of sale.

The distribution of the Offered Securities may be effected from time to time
in one or more transactions either: (i) at a fixed price or prices, which may be
changed; (ii) at market prices prevailing at the time of sale; (iii) at prices
related to such prevailing market prices; or (iv) at negotiated prices.

Offers to purchase Offered Securities may be solicited directly by the
Company. Offers to purchase Offered Securities may also be solicited by agents
designated by the Company from time to time. Any such agent, who may be deemed
to be an "underwriter" as that term is defined in the Securities Act, involved
in the offer or sale of the Offered 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.

If a dealer is utilized in the sale of the Offered Securities in respect of
which this Prospectus is delivered, the Company will sell such Offered
Securities to the dealer, as principal. The dealer, who may be deemed to be an
"underwriter" as that term is defined in the Securities Act, may then resell
such Offered Securities to the public at varying prices to be determined by such
dealer at the time of resale.

If an underwriter is, or underwriters are, utilized in the sale, the Company
will execute an underwriting agreement with such underwriters at the time of
sale to them and the names of the underwriters will be set forth in the
Prospectus Supplement, which will be used by the underwriters to make resales of
the Offered Securities in respect of which this Prospectus is delivered to the
public. In connection with the sale of Offered Securities, such underwriters may
be deemed to have received compensation from the Company in the form of
underwriting discounts or commissions and may also receive commissions from
purchasers of Offered Securities for whom they may act as agents. Underwriters
may also sell Offered Securities to or through dealers, and such dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions from the purchasers for whom they may act as
agents. Any underwriting compensation paid by the Company to underwriters in
connection with the offering of Offered Securities, and any discounts,
concessions or commissions allowed by underwriters to participating dealers,
will be set forth in the applicable Prospectus Supplement.

Underwriters, dealers, agents and other persons may be entitled, under
agreements that may be entered into with the Company, to indemnification by the
Company against certain civil liabilities, including liabilities under the
Securities Act, or to contribution with respect to payments which they may be
required to make in respect thereof. Underwriters and agents may engage in
transactions with, or perform services for, the Company in the ordinary course
of business.

If so indicated in the applicable Prospectus Supplement, the Company will
authorize underwriters, dealers or other persons to solicit offers by certain
institutions to purchase Offered Securities pursuant to contracts providing for
payment and delivery on a future date or dates. Institutions with which such
contracts may be made include commercial and savings banks, insurance companies,
pension funds, investment companies, educational and charitable institutions and
others. The obligations of any purchaser under any such contract will not be
subject to any conditions except that (a) the purchase of the Offered Securities
shall not at the time of delivery be prohibited under the laws of the
jurisdiction to which such purchaser is subject and (b) if the Offered
Securities are also being sold to underwriters, the Company

23
<PAGE>
shall have sold to such underwriters the Offered Securities not sold for delayed
delivery. The underwriters, dealers and such other persons will not have any
responsibility in respect to the validity or performance of such contracts. The
Prospectus Supplement relating to such contracts will set forth the price to be
paid for Offered Securities pursuant to such contracts, the commissions payable
for solicitation of such contracts and the date or dates in the future for
delivery of Offered Securities pursuant to such contracts.

The anticipated date of delivery of Offered Securities will be set forth in
the applicable Prospectus Supplement relating to each offer.

LEGAL MATTERS

The validity of the Offered Securities will be passed upon for the Company
by Latham & Watkins, Los Angeles, California. Unless otherwise indicated in the
Prospectus Supplement, if the Offered Securities are being distributed in an
underwritten offering or through agents, Skadden, Arps, Slate, Meagher & Flom,
LLP, Los Angeles, California, will act as counsel for such underwriters or
agents.

EXPERTS

The consolidated financial statements in the Company's Annual Report on Form
10-K incorporated by reference into this Prospectus have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their reports with
respect thereto, and are incorporated by reference herein in reliance upon the
authority of said firm as experts in giving said reports.

The consolidated financial statements of Bally Entertainment Corporation
appearing in Bally Entertainment Corporation's Annual Report (Form 10-K) for the
year ended December 31, 1995 have been audited by Ernst & Young LLP, independent
auditors, as set forth in their reports thereon included therein, and
incorporated herein by reference. Such consoldiated 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.

24
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

Set forth below is an estimate of the fees and expenses, other than
underwriting discounts and commissions, payable or reimbursable by the Company
in connection with the issuance and distribution of the Offered Securities.

<TABLE>
<S> <C>
SEC registration fee.............................................. $ 303,031
Fees and expenses of the Trustee.................................. 25,000
Printing and engraving expenses................................... 250,000
Rating agency fees................................................ 20,000
Legal fees and expenses........................................... 200,000
Blue Sky fees and expenses........................................ 20,000
Accounting fees and expenses...................................... 50,000
Miscellaneous..................................................... 31,969
---------
$ 900,000
---------
---------
</TABLE>

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Section 145 of the Delaware General Corporation Law, Article XI of Hilton's
Certificate of Incorporation and Paragraph 35 of Hilton's Bylaws authorize and
empower Hilton to indemnify its directors, officers, employees and agents, and
agreements with each of Hilton's directors and executive officers provide for
indemnification against liabilities incurred in connection with, and related
expenses resulting from, any claim, action or suit brought against any such
person as a result of such person's relationship with Hilton, PROVIDED that such
persons acted in accordance with a stated standard of conduct in connection with
the acts or events on which such claim, action or suit is based. The finding of
either civil or criminal liability on the part of such persons in connection
with such acts or events is not necessarily determinative of the question of
whether such persons have met the required standard of conduct and are,
accordingly, entitled to be indemnified.

Hilton has purchased for the benefit of its officers and directors and those
of certain subsidiaries insurance policies whereby the insurance companies
agree, among other things, that in the event any such officer or director
becomes legally obligated to make a payment (including legal fees and expenses)
in connection with an alleged wrongful act, such insurance companies will pay
Hilton up to $100,000,000. Wrongful act means any breach of duty, neglect,
error, misstatement, misleading statement or other act done by an officer or
director of Hilton or any subsidiary.

Reference is made to any Underwriting Agreement to be incorporated by
reference in the Prospectus, for provisions regarding indemnification of Hilton
and its officers, directors and controlling persons against certain liabilities.

II-1
<PAGE>
ITEM 16. EXHIBITS.

This Registration Statement includes the following exhibits:

<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -------------------------------------------------------------------------------------------
<C> <S>
*1.1 Form of Underwriting Agreement.

2.1 Agreement and Plan of Merger, dated as of June 6, 1996, as amended, by and between the
Company and Bally Entertainment Corporation (incorporated herein by reference from
Exhibit 2.1 to the Company's Registration Statement on Form S-4 (Commission File No.
333-10415)).

4.1 Restated Certificate of Incorporation of the Company, as amended.

4.2 Bylaws of the Company, as amended.

4.3 Form of Indenture.

4.4 Form of Note (included in Exhibit 4.3).

*4.5 Form of Warrant.

*4.6 Form of Warrant Agreement.

5.1 Opinion of Latham & Watkins as to the legality of the securities being registered.

12 Computation of Ratios of Earnings to Fixed Charges.

23.1 Consent of Latham & Watkins (included in Exhibit 5.1).

23.2 Consent of Arthur Andersen LLP.

23.3 Consent of Ernst & Young LLP.

24 Powers of Attorney of certain directors and officers of the Company (contained on the
signature pages hereof).

**25 Statement of Eligibility of Trustee on Form T-1.
</TABLE>

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

* To be incorporated by reference in connection with the offering of the
Offered Securities or to be filed by amendment.

** To be filed pursuant to Section 305(b)(2) of the TIA.

ITEM 17. UNDERTAKINGS.

(a) The Company hereby undertakes:

(1) 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;

(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% change in the

II-2
<PAGE>
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)(1)(i) and (a)(1)(ii) do not
apply if the registration statement is on From S-3 or Form S-8, and the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the registrant
pursuant to section 13 or section 15(d) of the Exchange Act that are
incorporated by reference in the Registration Statement.

(2) That, for the purpose of determining any liability under the
Securities Act, 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.

(3) 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.

(b) Hilton hereby undertakes that, for purposes of determining any liability
under the Securities Act, each filing of Hilton's annual report pursuant to
Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section 15(d) of
the Exchange Act) that is incorporated by reference in this 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.

(h) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Company pursuant to the foregoing provisions or otherwise, the Company has been
advised that in the opinion of the 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 Company of expenses incurred or paid
by a director, officer or controlling person of the Company 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
Company 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 of whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.

(j) The Company hereby undertakes to file an application for the purpose of
determining the eligibility of the trustee to act under subsection (a) of
Section 310 of the Trust Indenture Act ("Act") in accordance with the rules and
regulations prescribed by the Commission under Section 305(b)(2) of the Act.

II-3
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act, 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 Beverly Hills, State of California, on December 20, 1996.

HILTON HOTELS CORPORATION

By: /s/ MATTHEW J. HART
-----------------------------------------
Matthew J. Hart
EXECUTIVE VICE PRESIDENT AND CHIEF
FINANCIAL OFFICER

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Stephen F. Bollenbach, Matthew J. Hart and Scott
A. LaPorta and each of them, 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, to sign any and all
amendments (including post-effective amendments) and supplements to this
Registration Statement and to file the same, with all exhibits thereto and all
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto such attorneys-in-fact and agents and each of them
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, to all intents and
purposes and as fully as they might or could do in person, hereby ratifying and
confirming all that such attorney-in-fact and agent, each acting alone, or their
substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities indicated
on December 20, 1996:

<TABLE>
<S> <C>
/s/ STEPHEN F. BOLLENBACH /s/ MATTHEW J. HART
- ------------------------------------------- -------------------------------------------
Stephen F. Bollenbach Matthew J. Hart
Director, President and Executive Vice President and
Chief Executive Officer Chief Financial Officer

/s/ A. STEVEN CROWN /s/ BARRON HILTON
- ------------------------------------------- -------------------------------------------
A. Steven Crown Barron Hilton
Director Chairman of the Board

/s/ ARTHUR M. GOLDBERG /s/ ERIC M. HILTON
- ------------------------------------------- -------------------------------------------
Arthur M. Goldberg Eric M. Hilton
Director Director
</TABLE>

S-1
<PAGE>
<TABLE>
<S> <C>
/s/ DIETER H. HUCKESTEIN /s/ BENJAMIN V. LAMBERT
- ------------------------------------------- -------------------------------------------
Dieter H. Huckestein Benjamin V. Lambert
Director Director

/s/ ROBERT L. JOHNSON /s/ DONNA F. TUTTLE
- ------------------------------------------- -------------------------------------------
Robert L. Johnson Donna F. Tuttle
Director Director

/s/ DONALD R. KNAB /s/ SAM D. YOUNG, JR.
- ------------------------------------------- -------------------------------------------
Donald R. Knab Sam D. Young, Jr.
Director Director
</TABLE>

S-2
<PAGE>
EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------------------------------------------------------------------------------------------------
<C> <S>
*1.1 Form of Underwriting Agreement.

2.1 Agreement and Plan of Merger, dated as of June 6, 1996, as amended, by and between the Company and
Bally Entertainment Corporation (incorporated herein by reference from Exhibit 2.1 to the Company's
Registration Statement on Form S-4 (Commission File No. 333-10415)).

4.1 Restated Certificate of Incorporation of the Company, as amended.

4.2 Bylaws of the Company, as amended.

4.3 Form of Indenture.

4.4 Form of Note (included in Exhibit 4.3).

*4.5 Form of Warrant.

*4.6 Form of Warrant Agreement.

5.1 Opinion of Latham & Watkins as to the legality of the securities being registered.

12 Computation of Ratios of Earnings to Fixed Charges.

23.1 Consent of Latham & Watkins (included in Exhibit 5.1).

23.2 Consent of Arthur Andersen LLP.

23.3 Consent of Ernst & Young LLP.

24 Powers of Attorney of certain directors and officers of the Company (contained on the signature pages
hereof).

**25 Statement of Eligibility of Trustee on Form T-1.
</TABLE>

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

* To be incorporated by reference in connection with the offering of the
Offered Securities or to be filed by amendment.

** To be filed pursuant to Section 305(b)(2) of the TIA.

<PAGE>

RESTATED CERTIFICATE OF INCORPORATION

HILTON HOTELS CORPORATION

HILTON HOTELS CORPORATION, a Delaware corporation whose original
Certificate of Incorporation was filed in the Office of the Secretary of State
on May 29, 1946, and whose Certificate of Incorporation was thereafter amended
from time to time, and restated on May 16, 1968, and was thereafter amended from
time to time, hereby sets forth its Restated Certificate of Incorporation which
has been duly adopted by a resolution of the Board of Directors advising the
same, without a vote of the stockholders, as prescribed by Section 245 of the
General Corporation Law of the State of Delaware:

ARTICLE I

The name of the corporation (which is hereinafter referred to as "the
Corporation") is Hilton Hotels Corporation.

ARTICLE II

The registered office of the Corporation in the State of Delaware is
located at 1013 Centre Road, Wilmington, Delaware 19805. The name and address
of the Corporation's registered agent is United States Corporation Company, 1013
Centre Road, Wilmington, Delaware 19805.

ARTICLE III
The purpose of the Corporation is to engage in any lawful act or activity
for which corporations may be organized under the General Corporation Law of
Delaware.

ARTICLE IV

<PAGE>

(a) CAPITAL STOCK. The total number of shares of all classes of stock
which the Corporation shall have the authority to issue is Four Hundred
Twenty-Four Million Eight Hundred Thirty-Two Thousand Seven Hundred
(424,832,700) shares consisting of Four Hundred Million (400,000,000) shares of
Common Stock, par value $2.50 per share, and Twenty-Four Million Eight Hundred
Thirty-Two Thousand Seven Hundred (24,832,700) shares of Preferred Stock, par
value $1.00 per share.

(b) COMMON STOCK. The shares of authorized Common Stock of the
Corporation shall be identical in all respects and shall have equal rights and
privileges.

(c) PREFERRED STOCK. The Board of Directors shall have authority to
issue the shares of Preferred Stock from time to time on such terms as it may
determine, and to divide the Preferred Stock into one or more classes or series
and in connection with the creation of any such class or series to fix by the
resolution or resolutions providing for the issue of shares thereof the
designation, powers and relative, participating, optional, or other special
rights of such class or series, and the qualification, limitations, or
restrictions thereof, to the full extent now or hereafter permitted by law.

The terms of the Series A Junior Participating Preferred Stock are set
forth on Exhibit A hereto and are part of this Restated Certificate of
Incorporation.

ARTICLE V

The amount of the authorized stock of the Corporation of any class or
classes may be increased or decreased by the affirmative vote of the holders of
a majority of the stock of the Corporation entitled to vote.

ARTICLE VI

(a) NUMBER, ELECTION AND TERMS OF DIRECTORS. Except as otherwise fixed by
or

<PAGE>

pursuant to the provisions of Article IV hereof relating to the rights of the
holders of any class or series of stock having a preference over the Common
Stock as to dividends or upon liquidation to elect additional Directors under
specified circumstances, the number of the Directors of the Corporation shall be
fixed from time to time by or pursuant to the By-Laws of the Corporation. The
Directors, other than those who may be elected by the holders of any class or
series of stock having a preference over the Common Stock as to dividends or
upon liquidation, shall be classified, with respect to the time for which they
severally hold office, into three classes, as nearly equal in number as
possible, as shall be provided in the manner specified in the By-Laws of the
Corporation, one class to be originally elected for a term expiring at the
annual meeting of stockholders to be held in 1986, another class to be
originally elected for a term expiring at the annual meeting of stockholders to
be held in 1987, and another class to be originally elected for a term expiring
at the annual meeting of stockholders to be held in 1988, with each director to
hold office until his or her successor shall have been duly elected and
qualified. At each annual meeting of the stockholders of the Corporation, the
successors of the class of Directors whose term expires at that meeting shall be
elected to hold office for a term expiring at the annual meeting of stockholders
held in the third year following the year of their election.

(b) STOCKHOLDER NOMINATION OF DIRECTOR CANDIDATES AND INTRODUCTION OF
BUSINESS. Advance notice of stockholder nominations for the election of
Directors and advance notice of business to be brought by stockholders before an
annual meeting shall be given in the manner provided in the By-Laws of the
Corporation.

(c) NEWLY CREATED DIRECTORSHIPS AND VACANCIES. Except as otherwise
provided for or fixed by or pursuant to the provisions of Article IV hereof
relating to the rights of the holders of any class or series of stock having a
preference over the Common Stock as to dividends or upon liquidation to elect
additional directors under specified circumstances, newly created directorships
resulting from any increase in the number of Directors and any vacancies on the
Board of Directors resulting from death, resignation, disqualification, removal
or other cause shall be filled only by the affirmative vote of a majority of the

<PAGE>

remaining Directors then in office, even though less than a quorum of the Board
of Directors. Any Director elected in accordance with the preceding sentence
shall hold office for the remainder of the full term of the class of Directors
in which the new directorship was created or the vacancy occurred and until such
Director's successor shall have been duly elected and qualified. No decrease in
the number of Directors constituting the Board of Directors shall shorten the
term of any incumbent Director.

(d) REMOVAL. Subject to the rights of any class or series of stock having
a preference over the Common Stock as to dividends or upon liquidation to elect
Directors under specified circumstances, any Director may be removed from
office, with or without cause, only by the affirmative vote of the holders of
75% of the voting power of all shares of the Corporation entitled to vote
generally in the election of Directors, voting together as a single class.

(e) AMENDMENT, REPEAL, OR ALTERATION. Notwithstanding anything contained
in this Certificate of Incorporation to the contrary, the affirmative vote of
the holders of at least 75% of the voting power of all shares of the Corporation
entitled to vote generally in the election of directors, voting together as a
single class, shall be required to alter, amend or repeal this Article VI.

ARTICLE VII

Subject to the rights of the holders of any class or series of stock having
a preference over the Common Stock as to dividends or upon liquidation, any
action required or permitted to be taken by the stockholders of the Corporation
must be effected at a duly called annual or special meeting of such holders and
may not be effected by any consent in writing by such holders. Subject to the
rights of the holders of any class or series of stock having a preference over
the Common Stock as to dividends or upon liquidation, special meetings of
stockholders of the Corporation may be called only by the Chairman of the Board
or by the Board of Directors pursuant to a resolution approved by a majority of
the entire Board of Directors. Notwithstanding anything contained in this
Certificate of Incorporation to the

<PAGE>

contrary, the affirmative vote of the holders of at least 75% of the voting
power of all shares of the Corporation entitled to vote generally in the
election of directors, voting together as a single class, shall be required to
alter, amend or repeal this Article VII.

ARTICLE VIII

The Board of Directors shall have power to make, alter, amend and repeal
the By-Laws of the Corporation (except so far as the By-Laws of the Corporation
adopted by the stockholders shall otherwise provide). Any By-Laws made by the
Directors under the powers conferred hereby may be altered, amended or repealed
by the Directors or by the stockholders. Notwithstanding the foregoing and
anything contained in this Certificate of Incorporation to the contrary,
Articles B- 1, B-3, B-4 and C-1 of the By-Laws shall not be altered, amended or
repealed without the affirmative vote of the holders of at least 75% of the
voting power of all the shares of the Corporation entitled to vote generally in
the election of directors, voting together as a single class, except to renumber
the Article designations thereof. Notwithstanding anything contained in this
Certificate of Incorporation to the contrary, the affirmative vote of the
holders of at least 75% of the voting power of all the shares of the Corporation
entitled to vote generally in the election of directors, voting together as a
single class, shall be required to alter, amend or repeal this Article VIII.

ARTICLE IX

SECTION 1. VOTE REQUIRED FOR CERTAIN BUSINESS COMBINATIONS.

A. HIGHER VOTE FOR CERTAIN BUSINESS COMBINATIONS. In addition to any
affirmative vote required by law or this Certificate of Incorporation, and
except as otherwise expressly provided in Section 2 of this Article IX:

(i) any merger or consolidation of the Corporation or any Subsidiary
(as hereinafter defined) with (a) any Interested Stockholder (as
hereinafter defined) or (b)

<PAGE>

any other corporation (whether or not itself an Interested Stockholder)
which is, or after such merger or consolidation would be, an Affiliate (as
hereinafter defined) of an Interested Stockholder; or

(ii) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition (in one transaction or a series of transactions) to or with any
Interested Stockholder or any Affiliate of any Interested Stockholder of
any assets of the Corporation or any Subsidiary having an aggregate Fair
Market Value of $20,000,000 or more; or

(iii) the issuance or transfer by the Corporation or any Subsidiary
(in one transaction or a series of transactions) of any securities of the
Corporation or any Subsidiary to any Interested Stockholder or any
Affiliate of any Interested Stockholder in exchange for cash, securities or
other property (or a combination thereof) having an aggregate Fair Market
Value of $20,000,000 or more; or

(iv) the adoption of any plan or proposal for the liquidation or
dissolution of the Corporation proposed by or on behalf of an Interested
Stockholder or any Affiliate of any Interested Stockholder; or

(v) any reclassification of securities (including any reverse stock
split), or recapitalization of the Corporation, or any merger or
consolidation of the Corporation with any of its Subsidiaries or any other
transaction (whether or not with or into or otherwise involving an
Interested Stockholder) which has the effect, directly or indirectly, of
increasing the proportionate share of the outstanding shares of any class
of equity or convertible securities of the Corporation or any Subsidiary
which is directly or indirectly owned by any Interested Stockholder or any
Affiliate of any Interested Stockholder;

shall require the affirmative vote of the holders of at least 75% of the voting
power of the

<PAGE>

then outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors (the "Voting Stock" for purposes of this
Article IX), voting together as a single class (it being understood that for
purposes of this Article IX, each share of the Voting Stock shall have the
number of votes granted to it pursuant to Article IV of this Certificate of
Incorporation). Such affirmative vote shall be required notwithstanding the
fact that no vote may be required, or that a lesser percentage may be specified,
by law or in any agreement with any national securities exchange or otherwise.

B. DEFINITION OF "BUSINESS COMBINATION." The term "Business Combination"
as used in this Article IX shall mean any transaction which is referred to in
any one or more of clauses (i) through (v) of paragraph A of this Section 1.

SECTION 2. WHEN HIGHER VOTE IS NOT REQUIRED. The provisions of Section I
of this Article IX shall not be applicable to any particular Business
Combination, and such Business Combination shall require only such affirmative
vote as is required by law and any other provision of this Certificate of
Incorporation, if all of the conditions specified in either of the following
paragraphs A and B are met:

A. APPROVAL BY DISINTERESTED DIRECTORS. The Business Combination
shall have been approved by a majority of the Disinterested Directors (as
hereinafter defined).

B. PRICE AND PROCEDURE REQUIREMENTS. All of the following
conditions shall have been met:

(i) The aggregate amount of the cash and the Fair Market Value
(as hereinafter defined) as of the date of the consummation of the
Business Combination of consideration other than cash to be received
per share by holders of Common Stock in such Business Combination
shall be at least equal to the higher of the following:

<PAGE>

(a) (if applicable) the highest per share price (including
any brokerage commissions, transfer taxes and soliciting dealers'
fees) paid by the Interested Stockholder for any shares of Common
Stock acquired by it (1) within the two-year period immediately
prior to the first public announcement of the proposal of the
Business Combination (the "Announcement Date") or (2) in the
transaction in which it became an Interested Stockholder,
whichever is higher; and

(b) the Fair Market Value per share of Common Stock on the
Announcement Date or on the date on which the Interested
Stockholder became an Interested Stockholder (such latter date is
referred to in this Article IX as the "Determination Date"),
whichever is higher.

(ii) The aggregate amount of the cash and the Fair Market Value
as of the date of the consummation of the Business Combination of
consideration other than cash to be received per share by holders of
shares of any other class of outstanding Voting Stock, (other than
Excluded Preferred Stock and Institutional Voting Stock, as
hereinafter defined) shall be at least equal to the highest of the
following (it being intended that the requirements of this paragraph B
(ii) shall be required to be met with respect to every class of
outstanding Voting Stock (other than Excluded Preferred Stock and
Institutional Voting Stock), whether or not the Interested Stockholder
has previously acquired any shares of a particular class of Voting
Stock):

(a) (if applicable) the highest per share price (including
any brokerage commissions, transfer taxes and soliciting dealers'
fees) paid by the Interested Stockholder for any shares of such
class of Voting Stock acquired by it (1) within the two-year
period immediately prior to the Announcement Date or (2) in the
transaction in which it became an

<PAGE>

Interested Stockholder, whichever is higher;

(b) (if applicable) the highest preferential amount per
share to which the holders of shares of such class of Voting
Stock are entitled in the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation; and

(c) the Fair Market Value per share of such class of Voting
Stock on the Announcement Date or on the Determination Date,
whichever is higher.

(iii) The consideration to be received by holders of a particular
class of outstanding Voting Stock (including Common Stock and other
than Excluded Preferred Stock and Institutional Voting Stock) shall be
in cash or in the same form as the Interested Stockholder has
previously paid for shares of such class of Voting Stock. If the
Interested Stockholder has paid for shares of any class of Voting
Stock with varying forms of consideration, the form of consideration
for such class of Voting Stock shall be either cash or the form used
to acquire the largest number of shares of such class of Voting Stock
previously acquired by it. The price determined in accordance with
Paragraphs B(i) and B(ii) of this Section 2 shall be subject to
appropriate adjustment in the event of any stock dividend, stock
split, combination of shares or similar event.

(iv) After such Interested Stockholder has become an Interested
Stockholder and prior to the consummation of such Business
Combination: (a) except as approved by a majority of the Disinterested
Directors, there shall have been no failure to declare and pay at the
regular date therefor any full quarterly dividends (whether or not
cumulative) on any outstanding Preferred Stock; (b) there shall have
been (1) no reduction in the annual rate of dividends paid on the
Common Stock (except as necessary to reflect any

<PAGE>

subdivision of the Common Stock), except as approved by a majority of
the Disinterested Directors, and (2) an increase in such annual rate
of dividends as necessary to reflect any reclassification (including
any reverse stock split), recapitalization, reorganization or any
similar transaction which has the effect of reducing the number of
outstanding shares of the Common Stock, unless the failure so to
increase such annual rate is approved by a majority of the
Disinterested Directors; and (c) such Interested Stockholder shall
have not become the beneficial owner of any additional shares of
Voting Stock except as part of the transaction which results in such
Interested Stockholder becoming an Interested Stockholder.

(v) After such Interested Stockholder has become an Interested
Stockholder, such Interested Stockholder shall not have received the
benefit directly or indirectly (except proportionately as a
stockholder or in the ordinary course of the Corporation's business)
of any loans, advances, guarantees, pledges or other financial
assistance or any tax credits or other tax advantages provided by the
Corporation, whether in anticipation of or in connection with such
Business Combination or otherwise.

(vi) A proxy or information statement describing the proposed
Business Combination and complying with the requirements of the
Securities Exchange Act of 1934 and the rules and regulations
thereunder (or any subsequent provisions replacing such Act, rules or
regulations) shall be mailed to public stockholders of the Corporation
at least 30 days prior to the consummation of such Business
Combination (whether or not such proxy or information statement is
required to be mailed pursuant to such Act or subsequent provisions).

Section 3. CERTAIN DEFINITIONS. For the purposes of this Article IX:

<PAGE>

A. A "Person" shall mean any individual, firm, corporation or other
entity.

B. "Interested Stockholder" shall mean any person (other than the
Corporation or any Subsidiary) who or which:

(i) is the beneficial owner, directly or indirectly, of more than 10%
of the voting power of the outstanding Voting Stock;

(ii) is an Affiliate of the Corporation and at any time within the
two-year period immediately prior to the date in question was the
beneficial owner, directly or indirectly, of 10% or more of the voting
power of the then outstanding Voting Stock; or

(iii) is an assignee of or has otherwise succeeded to any shares of
Voting Stock which were at any time within the two-year period immediately
prior to the date in question beneficially owned by any Interested
Stockholder, if such assignment or succession shall have occurred in the
course of a transaction or series of transactions not involving a public
offering within the meaning of the Securities Act of 1933.

C. A person shall be a "beneficial owner" of any Voting Stock:

(i) which such person or any of its Affiliates or Associates (as
hereinafter defined) beneficially owns, directly or indirectly; or

(ii) which such person or any of its Affiliates or Associates has (a)
the right to acquire (whether such right is exercisable immediately or only
after the passage of time), pursuant to any agreement, arrangement or
understanding or upon the exercise of conversion rights, exchange rights,
warrants or options, or otherwise, it being understood that, pending a
final resolution or other disposition of the proceeding or proceedings to
determine the owner of such shares, Barron Hilton, James E. Bates

<PAGE>

and the Conrad N. Hilton Foundation each have the right to acquire the
6,782,289 shares of Common Stock held by the Estate of Conrad N. Hilton as
of March 8, 1985, or (b) the right to vote pursuant to any agreement,
arrangement or understanding; or

(iii) which are beneficially owned, directly or indirectly, by any
other person with which such person or any of its Affiliates or Associates
has any agreement, arrangement or understanding for the purpose of
acquiring, holding, voting or disposing of any shares of Voting Stock.

D. For the purposes of determining whether a person is an Interested
Stockholder pursuant to paragraph B of this Section 3, the number of shares of
Voting Stock deemed to be outstanding shall include shares deemed owned through
application of paragraph C of this Section 3 but shall not include any other
shares of Voting Stock which may be issuable pursuant to any agreement,
arrangement or understanding, or upon exercise of conversion rights, warrants or
options, or otherwise.

E. "Affiliate" or "Associate" shall have the respective meanings ascribed
to such terms in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as in effect on March 8, 1985.

F. "Subsidiary" means any corporation of which a majority of any class of
equity security is owned, directly or indirectly, by the Corporation; PROVIDED,
HOWEVER, that for the purposes of the definition of Interested Stockholder set
forth in paragraph B of this Section 3, the term "Subsidiary" shall mean only a
corporation of which a majority of each class of equity security is owned,
directly or indirectly, by the Corporation.

G. "Disinterested Director" means any member of the Board of Directors of
the Corporation (the "Board") who is unaffiliated with the Interested
Stockholder and was a member of the Board prior to the time that the Interested
Stockholder became an Interested

<PAGE>

Stockholder, and any director who is thereafter appointed to fill any vacancy on
the Board or who is elected and, in either event, who is unaffiliated with the
Interested Stockholder and in connection with his or her initial assumption of
office is recommended for appointment or election by a majority of Disinterested
Directors then on the Board.

H. "Fair Market Value" means (i) in the case of stock, the highest
closing sale price during the 30-day period immediately preceding the date in
question of a share of such stock on the Composite Tape for New York Stock
Exchange-Listed Stocks, or if such stock is not quoted on the Composite Tape, on
the New York Stock Exchange, or, if such stock is not listed on such Exchange,
on the principal United States securities exchange registered under the
Securities Exchange Act of 1934 on which such stock is listed, or, if such stock
is not listed on any such exchange, the highest closing bid quotation with
respect to a share of such stock during the 30-day period preceding the date in
question on the National Association of Securities Dealers, Inc. Automated
Quotations System or any system then in use, or if no such quotations are
available, the fair market value on the date in question of a share of such
stock as determined by the Board in good faith; and (ii) in the case of property
other than cash or stock, the fair market value of such property on the date in
question as determined by the Board in good faith.

I. In the event of any Business Combination in which the Corporation
survives, the phrase "consideration other than cash to be received" as used in
paragraphs B(i) and (ii) of Section 2 of this Article IX shall include the
shares of Common Stock and/or the shares of any other class of outstanding
Voting Stock retained by the holders of such shares.

J. "Excluded Preferred Stock" shall mean any series of Preferred Stock
with respect to which the Certificate of Designation creating such series
expressly provides that the provisions of this Article IX shall not apply.

K. "Institutional Voting Stock" shall mean any class or series of Voting
Stock which was issued to and continues to be held solely by one or more
insurance companies,

<PAGE>

pension funds, commercial banks, savings banks or similar financial institutions
or institutional investors.

SECTION 4. POWERS OF THE BOARD OF DIRECTORS. A majority of the Directors
of the Corporation shall have the power and duty to determine for the purposes
of this Article IX, on the basis of information known to them after reasonable
inquiry, (A) whether a person is an Interested Stockholder, (B) the number of
shares of Voting Stock beneficially owned by any person, (C) whether a person is
an Affiliate or Associate of another, (D) whether the assets which are the
subject of any Business Combination have, or the consideration to be received
for the issuance or transfer of securities by the Corporation or any Subsidiary
in any Business Combination has, an aggregate Fair Market Value of $20,000,000
or more. A majority of the Directors shall have the further power to interpret
all of the terms and provisions of this Article IX.

SECTION 5. NO EFFECT ON FIDUCIARY OBLIGATIONS OF INTERESTED STOCKHOLDERS.
Nothing contained in this Article IX shall be construed to relieve any
Interested Stockholder from any fiduciary obligation imposed by law.

SECTION 6. AMENDMENT, REPEAL, ETC. Notwithstanding any other provisions of
this Certificate of Incorporation or the By-Laws of the Corporation (and
notwithstanding the fact that a lesser percentage may be specified by law, this
Certificate of Incorporation or the By-Laws of the Corporation), the affirmative
vote of the holders of 75% or more of the outstanding Voting Stock, voting
together as a single class, shall be required to alter, amend or repeal this
Article IX.

ARTICLE X

(a) If any person (as hereinafter defined) which beneficially owns Voting
Stock (as hereinafter defined) of the Corporation (i) is requested or required
pursuant to any Gaming Regulation (as hereinafter defined) to appear before, or
submit to the jurisdiction of, or

<PAGE>

provide information to, any Gaming Authority (as hereinafter defined) and either
refuses to do so or otherwise fails to comply with such request or requirement
within a reasonable period of time or (ii) is determined or shall have been
determined by any Gaming Authority not to be suitable or qualified with respect
to the beneficial ownership of Voting Stock of the Corporation, each such person
by owning shares in the Corporation hereby agrees to sell to the Corporation and
the Corporation shall have the absolute right in its sole discretion to
repurchase, any or all of the Voting Stock of the Corporation beneficially owned
by such person at a price determined pursuant to Section (c) hereof. The
operation of this Article X shall not be stayed by an appeal from a
determination of any Gaming Authority.

(b) If the Corporation intends to repurchase Voting Stock beneficially
owned by any person referred to in clause (i) or (ii) of Section (a) hereof, it
shall notify the person in writing of such intention, specifying the Voting
Stock to be repurchased, the date, time and place when such repurchase will be
consummated (the "Repurchase Date"), which date in no event will be earlier than
three business days after the date of such notice and the price at which such
Voting Stock will be repurchased (it being sufficient for purposes of this
Article X for the Corporation to indicate generally that the price will be
determined in accordance with Section (c) hereof). If the Corporation gives the
notice provided for by the preceding sentence (the "Repurchase Notice"), such
notice shall be deemed to constitute a binding agreement on the part of the
Corporation to repurchase, and on the part of the person notified to sell, the
Voting Stock referred to in such Notice in accordance with this Article X.
Following the Repurchase Date, no dividends will be payable on and no voting
rights will be available to the holders of any Voting Stock covered by such
Repurchase Notice which has not been duly delivered by the holder thereof for
repurchase by the Corporation. If, following such Repurchase Date, any stock
with respect to which a Repurchase Notice has been given has not been duly
delivered by the holder thereof for repurchase by the Corporation, the
Corporation shall deposit in escrow or otherwise hold in trust for the benefit
of such holder an amount equal to the aggregate Market Price (as hereinafter
defined) of the stock to be repurchased except that to the extent New Shares (as
hereinafter defined) are to be repurchased and the Purchase Price (as
hereinafter defined) thereof shall have been

<PAGE>

publicly disclosed or otherwise made available to the Corporation, the amount
deposited in escrow or otherwise segregated with respect to such New Shares may
be the lesser of the Market Price thereof on the date of the Repurchase Notice
and the Purchase Price thereof. The establishment of such an account shall in
no way alter the amount otherwise payable to any person pursuant to this Article
X. No interest shall be paid on or accrue with respect to any amount so
deposited or held.

(c)(i) In the event that the person to whom Repurchase Notice is directed
pursuant to Section (b) hereof has acquired beneficial ownership of shares of
Voting Stock within the twenty-four month period terminating on the date of such
Notice ("New Shares"), the price at which the Corporation shall repurchase such
New Shares as are covered by the Repurchase Notice shall be the lesser of the
Market Price thereof on the date of such Notice and the Purchase Price thereof.

(ii) In the event that the person to whom a Repurchase Notice is directed
pursuant to Section (b) hereof has acquired beneficial ownership of any or all
of his shares of Voting Stock prior to the twenty-four month period terminating
on the date of such Notice ("Old Shares"), the price at which the Corporation
shall repurchase such Old Shares as are covered by the Repurchase Notice shall
be the Market Price thereof on the date of the Repurchase Notice.

(iii) The Corporation shall have the option in its sole discretion of
designating which shares of the shares beneficially owned by any person referred
to in clause (i) or (ii) of Section (a) hereof are subject to the Repurchase
Notice and, for purposes hereof, it shall be sufficient for the Corporation to
indicate generally that shares shall be repurchased based on the order in which
they were purchased or based on the reverse of such order.

(iv) Any person to whom a Repurchase Notice is given pursuant to the
provisions of this Article shall have the burden of establishing to the
satisfaction of the Corporation the dates on which and prices at which such
person acquired the stock subject to such Notice.

<PAGE>

(d) For purposes of this Article X:

1. A "person" shall mean any individual, firm, corporation or other
entity.

2. "Voting Stock" shall mean the shares of capital stock of the
Corporation entitled to vote generally in the election of directors.

3. A person shall be a "beneficial owner" of any Voting Stock:

(i) which such person or any of its Affiliates or Associates (as
hereinafter defined) beneficially owns, directly or indirectly; or

(ii) which such person or any of its Affiliates or Associates has
(a) the right to acquire (whether such right is exercisable
immediately or only after the passage of time), pursuant to any
agreement, arrangement or understanding or upon the exercise of
conversion rights, exchange rights, warrants or options, or otherwise,
or (b) the right to vote pursuant to any agreement, arrangement or
understanding; or

(iii)which are beneficially owned, directly or indirectly, by any
other Person with which such person or any of its Affiliates or
Associates has any agreement, arrangement or understanding for the
purpose of acquiring, holding, voting or disposing of any shares of
Voting Stock.

4. "Affiliate" or "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations
under the Securities Exchange Act of 1934, as in effect on March 8, 1985.

5. A "Gaming Regulation" shall mean any statute, rule, regulation,
order, ordinance or interpretation of a Gaming Authority.

<PAGE>

6. A "Gaming Authority" shall mean any government, court, or
governmental, administrative or regulatory agency or authority, Federal,
state, local or foreign, which regulates or otherwise asserts jurisdiction
over gaming operations or facilities conducted by the Corporation or any of
its subsidiaries or Affiliates.

7. "Market Price" means the average of the last sale prices of a
share of such Voting Stock on the Composite Tape for New York Stock
Exchange-Listed Stocks for each of the 15 consecutive trading days (the
"Valuation Period") commencing 16 trading days prior to the date in
question; provided that if such Stock is not quoted on the Composite Tape,
such average last sale price shall be derived from the average last sale
prices on the New York Stock Exchange, or, if such Stock is not listed on
such Exchange, on the principal United States securities exchange
registered under the Securities Exchange Act of 1934 on which such Stock is
listed, or, if such Stock is not listed on any such exchange, the average
of the closing bid quotations with respect to a share of such Stock during
the Valuation Period on the National Association of Securities Dealers,
Inc. Automated Quotations System or any system then in use, or if no such
quotations are available, the fair market value on the date in question of
a share of such Stock as determined by the Board of Directors in good
faith.

8. "Purchase Price" means the price paid to acquire a share of the
Voting Stock, exclusive of commissions, taxes and other fees and expenses,
adjusted for any stock split, stock dividend, combination of shares or
similar event.

(e) A majority of the Directors of the Corporation shall have the power
and duty to determine for the purposes of this Article X on the basis of
information known to them after reasonable inquiry, whether clause (i) or (ii)
of Section (a) hereof applies to any person who beneficially owns Voting Stock
of the Corporation such that the Corporation shall have the right to repurchase
shares of Voting Stock held by such person pursuant to this Article X.

<PAGE>

ARTICLE X-A

Election of Directors need not be by ballot unless the By-laws of the
Corporation shall so provide.

ARTICLE XI

SECTION 1. ELIMINATION OF CERTAIN LIABILITY OF DIRECTORS.

A Director of the Corporation shall not be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the Director's
duty of loyalty to the Corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the Delaware General Corporation
Law, or (iv) for any transaction from which the Director derived an improper
personal benefit.

SECTION 2. INDEMNIFICATION AND INSURANCE.

(a) ACTION, ETC., OTHER THAN BY OR IN THE RIGHT OF THE CORPORATION. The
Corporation shall indemnify and hold harmless, to the fullest extent permitted
by applicable law as it presently exists or may hereafter be amended, Agent (as
hereinafter defined) against costs, charges and Expenses (as hereinafter
defined), judgments, fines and amounts paid in settlement actually and
reasonably incurred by an Agent in connection with such action, suit or
proceeding, and any appeal therefrom, if Agent acted in good faith and in a
manner Agent reasonably believed to be in or not opposed to the best interests
of the Corporation, and with respect to any criminal action or proceeding, had
no reasonable cause to believe such conduct was unlawful. The termination of
any action, suit or proceeding-whether by judgment, order, settlement,
conviction, or upon a plea of NOLO CONTENDERE or its equivalent-shall not, of

<PAGE>

itself, create a presumption that the Agent did not act in good faith and in a
manner which the Agent reasonably believed to be in or not opposed to the best
interests of the Corporation, and, with respect to any criminal action or
proceeding, that such person had reasonable cause to believe that the Agent's
conduct was unlawful.

(b) ACTION, ETC., BY OR IN THE RIGHT OF THE CORPORATION. The Corporation
shall indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed judicial action or suit brought by
or in the right of the Corporation to procure a judgment in its favor by reason
of the fact that such person is or was an Agent, against costs, charges and
Expenses actually and reasonably incurred by an Agent in connection with the
defense or settlement of such action or suit and any appeal therefrom if the
Agent acted in good faith and in a manner such person reasonably believed to be
in or not opposed to the best interests of the Corporation, except that no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable for gross negligence or
willful misconduct in the performance of the Agent's duty to the Corporation
unless and only to the extent that the Court of Chancery or the court in which
such action or suit was brought shall determine upon application that, despite
the adjudication of liability but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such costs,
charges and Expenses which the Court of Chancery or other such court shall deem
proper.

(c) DETERMINATION OF RIGHT OF INDEMNIFICATION. Any indemnification under
Paragraphs (a) and (b) of this Section (unless ordered by a court) shall be paid
by the Corporation unless a determination is reasonably and promptly made (i) by
the Board of Directors by a majority vote of a quorum consisting of Directors
who were not parties to such action, suit or proceeding, or (ii) if such a
quorum is not obtainable, or, even if obtainable, if a quorum of disinterested
Directors so directs, by independent legal counsel in a written opinion, or
(iii) by the stockholders, that such person acted in bad faith and in a manner
that such person did not believe to be in or not opposed to the best interests
of the Corporation, or, with respect to any criminal proceeding, that such
person believed or had

<PAGE>

reasonable cause to believe that his conduct was unlawful.

(d) INDEMNIFICATION AGAINST EXPENSES OF SUCCESSFUL PARTY. Notwithstanding
the other provisions of this Section, to the extent that an Agent has been
successful on the merits or otherwise, including, without limitation, the
dismissal of an action without prejudice, the settlement of an action without
admission of liability, or the defense of any claim, issue or matter therein, or
on appeal from any such proceeding, action, claim or matter, such Agent shall be
indemnified against all costs, charges and Expenses incurred in connection
therewith.

(e) ADVANCES OF EXPENSES. Except as limited by Paragraph (f) of this
Section, costs, charges, and Expenses incurred by an Agent in any action, suit,
proceeding or investigation or any appeal therefrom shall be paid by the
Corporation in advance of the final disposition of such matter, if the Agent
shall undertake to repay such amount in the event that it is ultimately
determined, as provided herein, that such person is not entitled to
indemnification. Notwithstanding the foregoing, no advance shall be made by the
Corporation if a determination is reasonably and promptly made by the Board of
Directors by a majority vote of a quorum of disinterested Directors, or (if such
a quorum is not obtainable or, even if obtainable, a quorum of disinterested
Directors so directs) by independent legal counsel in a written opinion, that,
based upon the facts known to the Board of Directors or counsel at the time such
determination is made, the Agent acted in bad faith and in a manner that such
person did not believe to be in or not opposed to the best interests of the
Corporation, or, with respect to any criminal proceeding, that such person
believed or had reasonable cause to believe his conduct was unlawful. In no
event shall any advance be made in instances where the Board of Directors or
independent legal counsel reasonably determines that the Agent deliberately
breached such person's duty to the Corporation or its stockholders.

<PAGE>

the written request of the Agent, unless with respect to applications under
Paragraphs (a), (b) or (e), a determination is reasonably and promptly made by
the Board of Directors by a majority vote of a quorum of disinterested Directors
that such Agent acted in a manner set forth in such Paragraphs as to justify the
Corporation's not indemnifying or making an advance to the Agent. In the event
no quorum of disinterested Directors is obtainable, the Board of Directors shall
promptly direct that independent legal counsel shall decide whether the Agent
acted in the manner set forth in such Paragraphs as to justify the Corporation's
not indemnifying or making an advance to the Agent. The right to
indemnification or advances as granted by this Section shall be enforceable by
the Agent in any court of competent jurisdiction, if the Board of Directors or
independent legal counsel denies the claim in whole or in part, or if no
disposition of such claim is made within 60 days. The Agent's costs, charges
and Expenses incurred in connection with successfully establishing such person's
right to indemnification, in whole or in part, in any such proceeding shall also
be indemnified by the Corporation.

(g) OTHER RIGHTS AND REMEDIES. The indemnification provided by this
Section shall not be deemed exclusive of, and shall not affect, any other rights
to which an Agent seeking indemnification may be entitled under any law, By-Law,
or charter provision, agreement, vote of stockholders or disinterested Directors
or otherwise, both as to action in such person's official capacity and as to
action in another capacity while holding such office, and shall continue as to a
person who has ceased to be an Agent and shall inure to the benefit of the
heirs, executors and administrators of such a person. All rights to
indemnification under this Section shall be deemed to be a contract between the
Corporation and the Agent who serves in such capacity at any time while these
Articles and other relevant provisions of the general corporation law and other
applicable law, if any, are in effect. Any repeal or modification thereof shall
not affect any rights or obligations then existing.

<PAGE>

not the Corporation would have the power to indemnify such person against such
liability under the provisions of this Section. The Corporation may create a
trust fund, grant a security interest or use other means (including, without
limitation, a letter of credit) to ensure the payment of such sums as may become
necessary to effect indemnification as provided herein.

(i) PRESUMPTIONS AND EFFECT OF CERTAIN PROCEEDINGS.

(1) If a Change of Control (as hereinafter defined) shall have
occurred, in making a determination with respect to entitlement to
indemnification hereunder, the person, persons or entity making such
determination shall presume that the Agent is entitled to indemnification
under this Section if the Agent has submitted a request for indemnification
in accordance with Paragraph (f) of this Section, and the Corporation shall
have the burden of proof to overcome that presumption in connection with
the making by any person, persons or entity of any determination contrary
to that presumption.

(2) If the person, persons or entity empowered or selected under
Paragraph (f) of this Section to determine whether the Agent is entitled to
indemnification shall not have made such determination within 60 days after
receipt by the Corporation of the request therefor, the requisite
determination of entitlement to indemnification shall be deemed to have
been made and the Agent shall be entitled to such indemnification, absent
(i) a misstatement by the Agent of a material fact, or an omission of a
material fact necessary to make the Agent's statement not materially
misleading, in connection with the request for indemnification, or (ii) a
prohibition of such indemnification under applicable law; PROVIDED,
HOWEVER, that such 60-day period may be extended for a reasonable time, not
to exceed an additional 30 days, if the person, persons or entity making
the determination with respect to entitlement to indemnification in good
faith requires such additional time for the obtaining or evaluating of
documentation and/or information relating thereto; and PROVIDED, FURTHER,
that the foregoing provi-

<PAGE>

sions of this Paragraph (i) shall not apply (a) if the determination of
entitlement to indemnification is to be made by the stockholders pursuant
to Paragraph (f) of this Section and if (A) within 15 days after receipt by
the Corporation of the request for such determination the Board of
Directors has resolved to submit such determination to the stockholders for
their consideration at an annual meeting thereof to be held within 75 days
after such receipt and such determination is made thereat, or (B) a special
meeting of stockholders is called within 15 days after such receipt for the
purpose of making such determination, such meeting is held for such purpose
within 60 days after having been so called and such determination is made
thereat, or (b) if the determination of entitlement to indemnification is
to be made by independent counsel pursuant to Paragraph (f) of this
Section.

(3) The termination of any proceeding or of any claim, issue or
matter therein by judgment, order, settlement or conviction, or upon a plea
of NOLO CONTENDERE or its equivalent, shall not (except as otherwise
expressly provided in this Section) of itself adversely affect the right of
the Agent to indemnification or create a presumption that the Agent did not
act in good faith and in a manner which such person reasonably believed to
be in or not opposed to the best interests of the Corporation, or, with
respect to any criminal proceeding, that the Agent had reasonable cause to
believe that such person's conduct was unlawful.

(j) OTHER ENTERPRISES, FINES, AND SERVING AT CORPORATION'S REQUEST. For
purposes of this Section, references to "other enterprise" in Paragraph (a)
shall include employee benefit plans; references to "fines" shall include any
excise taxes assessed on a person with respect to any employee benefit plan; and
references to "serving at the request of the Corporation" shall include any
service by Agent as Director, officer, employee, agent or fiduciary of the
Corporation which imposes duties on, or involves services by, such Agent with
respect to any employee benefit plan, its participants, or beneficiaries; and a
person who acted in good faith and in a manner such person reasonably believed
to be in the interest of the participants and beneficiaries of an employee
benefit plan shall be deemed to have acted

<PAGE>

in a manner "not opposed to the best interests of the Corporation" as referred
to in this Section.

(k) SAVINGS CLAUSE. If this Section or any portion thereof shall be
invalidated on any ground by any court of competent jurisdiction, then the
Corporation shall nevertheless indemnify each Agent as to costs, charges and
Expenses, judgments, fines and amounts paid in settlement with respect to any
action, suit, proceeding or investigation, and any appeal therefrom, whether
civil, criminal or administrative, and whether internal or external, including a
grand jury proceeding and an action or suit brought by or in the right of the
Corporation, to the full extent permitted by any applicable portion of this
Section that shall not have been invalidated, and to the fullest extent
permitted by applicable law.

(l) DEFINITIONS. For the purposes of this Article:

(1) "Agent" means any person who was or is a party or is threatened
to be made a party to any threatened, pending or completed action, suit or
proceeding or investigation, whether civil, criminal or administrative, and
whether external or internal to the Corporation (other than a judicial
action or suit brought by or in the right of the Corporation) by reason of
the fact that he or she is or was or has agreed to be a Director, officer,
employee, agent or fiduciary of the Corporation, or that, being or having
been such a Director, officer, employee, agent or fiduciary, he or she is
or was serving at the request of the Corporation as a Director, officer,
employee, agent or fiduciary of another corporation, partnership, joint
venture, trust or other enterprise.

(2) "Expenses" shall include all reasonable attorneys' fees,
retainers, court costs, transcript costs, fees of experts, witness fees,
travel expenses, duplicating costs, printing and binding costs, telephone
charges, postage, delivery service fees, and all other disbursements or
expenses of the types customarily incurred in connection with prosecuting,
defending, preparing to prosecute or defend,

<PAGE>

investigating, or being or preparing to be a witness in a proceeding.

(3) "Change of Control" means a change in control of the Corporation
of a nature that would be required to be reported in response to Item 5(f)
of Schedule 14A of Regulation 14A (or in response to any similar item on
any similar schedule) promulgated under the Securities Exchange Act of
1934, as amended, (the "Act"), whether or not the Corporation is then
subject to such reporting requirement; PROVIDED, HOWEVER, that, without
limitation, such a Change of Control shall be deemed to have occurred if
(i) any "person" (as such term is used in Sections 13(d) and 14(d) of the
Act) is or becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Act), directly or indirectly, of securities of the Corporation
representing 25% or more of the combined voting power of the Corporation's
then outstanding securities without the prior approval of at least
two-thirds of the members of the Board of Directors in office immediately
prior to such person attaining such percentage interest; (ii) the
Corporation is a party to a merger, consolidation, sale of assets or other
reorganization, or a proxy contest, as a consequence of which members of
the Board of Directors in office immediately prior to such transaction or
event constitute less than a majority of the Board of Directors thereafter;
or (iii) during any period of three consecutive years, individuals who at
the beginning of such period constituted the Board of Directors (including
for this purpose any new Director whose election or nomination for election
by the Corporation's stockholders was approved by a vote of at least
two-thirds of the directors then still in office who were Directors at the
beginning of such period) cease for any reason to constitute at least a
majority of the Board of Directors.

ARTICLE XII

The Corporation reserves the right at any time and from time to time to
amend, alter, change or repeal any provision contained in this Certificate of
Incorporation, and other provisions authorized by the laws of the State of
Delaware at the time in force may be added or inserted, in the manner now or
hereafter prescribed by law; and all rights, preferences and

<PAGE>

privileges of whatsoever nature conferred upon stockholders, Directors or any
other persons whomsoever by and pursuant to this Certificate of Incorporation in
its present form or as hereafter amended are granted subject to the right
reserved in this Article.

CERTIFICATE

IT IS CERTIFIED that the foregoing Restated Certificate of Incorporation,
which restates and integrates, but does not further amend, the Certificate of
Incorporation of Hilton Hotels Corporation as heretofore amended or
supplemented, was adopted by the Board of Directors of Hilton Hotels Corporation
in a resolution and declaring its advisability, in accordance with the
provisions of Section 245 of the General Corporation Law of the State of
Delaware, without a vote of the stockholders. There is no discrepancy between
the provisions of the Certificate of Incorporation, as heretofore amended or
supplemented, and this Restated Certificate of Incorporation.

<PAGE>

IN WITNESS WHEREOF, Hilton Hotels Corporation has caused this Restated
Certificate of Incorporation to be signed by its Senior Vice President and
General Counsel and attested by its Vice President and Corporate Secretary on
this 20th day of November, 1996.

Hilton Hotels Corporation

/s/ William C. Lebo, Jr.
--------------------------------------
Name: William C. Lebo, Jr.
Title: Senior Vice President
and General Counsel

Attest /s/ Cheryl L. Marsh
----------------------------
Name: Cheryl L. Marsh
Title: Vice President and
Corporate Secretary

<PAGE>

EXHIBIT A

Series A Junior Participating Preferred Stock:

Section 1. DESIGNATION AND AMOUNT. The shares of such series shall
be designated as "Series A Junior Participating Preferred Stock" (the "Series A
Preferred Stock") and the number of shares constituting the Series A Preferred
Stock shall be 550,000. Such number of shares may be increased or decreased by
resolution of the Board of Directors; PROVIDED, that no decrease shall reduce
the number of shares of Series A Preferred Stock to a number less than the
number of shares then outstanding plus the number of shares reserved for
issuance upon the exercise of outstanding options, rights or warrants or upon
the conversion of any outstanding securities issued by the Corporation
convertible into Series A Preferred Stock.

Section 2. DIVIDENDS AND DISTRIBUTIONS.

(A) Subject to the rights of the holders of any shares of any series
of Preferred Stock (or any similar stock) ranking prior and superior to the
Series A Preferred Stock with respect to dividends, the holders of shares
of Series A Preferred Stock, in preference to the holders of Common Stock,
par value $2.50 per shares (the "Common Stock"), of the Corporation, and of
any other junior stock, shall be entitled to receive, when, as and if
declared by the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on the first day of January,
April, July and October in each year (each such date being referred to
herein as a "Quarterly Dividend Payment Date"), commencing on the first
Quarterly Dividend Payment Date after the first issuance of a share or
fraction of a share of Series A Preferred Stock, in an amount per share
(rounded to the nearest cent) equal to the greater of (a) $1 or (b) subject
to the provision for adjustment hereinafter set forth, 100 times the
aggregate per share amount of all cash dividends, and 100 times the
aggregate per share amount (payable in kind) of all non-cash dividends or
other distributions, other than a dividend payable in shares of Common
Stock or a subdivision of the outstanding shares of Common Stock (by
reclassification or otherwise), declared on the Common Stock since the
immediately preceding Quarterly Dividend Payment Date or, with respect to
the first Quarterly Dividend Payment Date, since the first issuance of any
share or fraction of a share of Series A Preferred Stock. In the event the
Corporation shall at any time after the issuance of any shares of Series A
Preferred Stock declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares of Common Stock,
then in each such case the amount to which holders of shares of Series A
Preferred Stock were entitled immediately prior to such event under clause
(b) of the preceding sentence shall be adjusted by multiplying such amount
by a fraction, the numerator of which is the number of

<PAGE>

shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.

(B) The Corporation shall declare a dividend or distribution on the
Series A Preferred Stock as provided in paragraph (A) of this Section
immediately after it declares a dividend or distribution on the Common
Stock (other than a dividend payable in shares of Common Stock); provided
that, in the event no dividend or distribution shall have been declared on
the Common Stock during the period between any Quarterly Dividend Payment
Date and the next subsequent Quarterly Dividend Payment Date, a dividend of
$1 per share on the Series A Preferred Stock shall nevertheless be payable
on such subsequent Quarterly Dividend Payment Date.

(C) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series A Preferred Stock from the Quarterly Dividend Payment Date
next preceding the date of issue of such shares, unless the date of issue
of such shares is prior to the record date for the first Quarterly Dividend
Payment Date, in which case dividends on such shares shall begin to accrue
from the date of issue of such shares, or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series A Preferred Stock entitled to
receive a quarterly dividend and before such Quarterly Dividend Payment
Date, in either of which events such dividends shall begin to accrue and be
cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the shares of Series
A Preferred Stock in an amount less than the total amount of such dividends
at the time accrued and payable on such shares shall be allocated pro rata
on a share-by-share basis among all such shares at the time outstanding.
The Board of Directors may fix a record date for the determination of
holders of shares of Series A Preferred Stock entitled to receive payment
of a dividend or distribution declared thereon, which record date shall be
not more than 60 days prior to the date fixed for the payment thereof.

Section 3. VOTING RIGHTS. The holders of shares of Series A
Preferred Stock shall have the following voting rights:

(A) Subject to the provision for adjustment hereinafter set forth,
each share of Series A Preferred Stock shall entitle the holder thereof to
100 votes on all matters submitted to a vote of the stockholders of the
Corporation. In the event the Corporation shall at any time after the
issuance of any shares of Series A Preferred Stock declare or pay any
dividend on the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of
Common Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser number of
shares of Common Stock, then in each such case the number of votes per
share to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event shall be adjusted by multiplying such
number by a fraction, the

<PAGE>

numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such
event.

(B) Except as otherwise provided herein, in any other Certificate of
Designations creating a series of Preferred Stock or any similar stock, or
by law, the holders of shares of Series A Preferred Stock and the holders
of shares of Common Stock and any other capital stock of the Corporation
having general voting rights shall vote together as one class on all
matters submitted to a vote of stockholders of the Corporation.

(C) Except as set forth herein, or as otherwise provided by law,
holders of Series A Preferred Stock shall have no special voting rights and
their consent shall not be required (except to the extent they are entitled
to vote with holders of Common Stock as set forth herein) for taking any
corporate action.

Section 4. CERTAIN RESTRICTIONS.

(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Preferred Stock as provided in Section 2 are in
arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A Preferred
Stock outstanding shall have been paid in full, the Corporation shall not:

(i) declare or pay dividends, or make any other distributions,
on any shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred
Stock;

(ii) declare or pay dividends, or make any other distributions,
on any shares of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, except dividends paid ratably on the Series A
Preferred Stock and all such parity stock on which dividends are
payable or in arrears in proportion to the total amounts to which the
holders of all such shares are then entitled;

(iii) redeem or purchase or otherwise acquire for consideration
shares of any stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred
Stock, provided that the Corporation may at any time redeem, purchase
or otherwise acquire shares of any such junior stock in exchange for
shares of any stock of the Corporation ranking junior (either as to
dividends or upon dissolution, liquidation or winding up) to the
Series A Preferred Stock; or

(iv) redeem or purchase or otherwise acquire for consideration
any shares of Series A Preferred Stock, or any shares of stock ranking
on a parity

<PAGE>

with the Series A Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as determined by the
Board of Directors) to all holders of such shares upon such terms as
the Board of Directors, after consideration of the respective annual
dividend rates and other relative rights and preferences of the
respective series and classes, shall determine in good faith will
result in fair and equitable treatment among the respective series or
classes.

(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares
of stock of the Corporation unless the Corporation could, under
paragraph (A) of this Section 4, purchase or otherwise acquire such shares
at such time and in such manner.

Section 5. REACQUIRED SHARES. Any shares of Series A Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and cancelled promptly after the acquisition thereof. All such
shares shall upon their cancellation become authorized but unissued shares of
Preferred Stock and may be reissued as part of a new series of Preferred Stock
subject to the conditions and restrictions on issuance set forth herein, in the
Certificate of Incorporation, or in any other Certificate of Designations
creating a series of Preferred Stock or any similar stock or as otherwise
required by law.

Section 6. LIQUIDATION, DISSOLUTION OR WINDING UP. Upon any
liquidation, dissolution or winding up of the Corporation, no distribution shall
be made (1) to the holders of shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the Series A
Preferred Stock unless, prior thereto, the holders of shares of Series A
Preferred Stock shall have received $100 per share, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not declared,
to the date of such payment, provided that the holders of shares of Series A
Preferred Stock shall be entitled to receive an aggregate amount per share,
subject to the provision for adjustment hereinafter set forth, equal to 100
times the aggregate amount to be distributed per share to holders of shares of
Common Stock, or (2) to the holders of shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or winding up) with the
Series A Preferred Stock, except distributions made ratably on the Series A
Preferred Stock and all such parity stock in proportion to the total amounts to
which the holders of all such shares are entitled upon such liquidation,
dissolution or winding up. In the event the Corporation shall at any time after
the issuance of any shares of Series A Preferred Stock declare or pay any
dividend on the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common Stock, then
in each such case the aggregate amount to which holders of shares of Series A
Preferred Stock were entitled immediately prior to such event under the proviso
in clause (1) of the preceding sentence shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the

<PAGE>

denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.

Section 7. CONSOLIDATION, MERGER, ETC. In case the Corporation shall
enter into any consolidation, merger, combination or other transaction in which
the shares of Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case each share of
Series A Preferred Stock shall at the same time be similarly exchanged or
changed into an amount per share, subject to the provision for adjustment
hereinafter set forth, equal to 100 times the aggregate amount of stock,
securities, cash and/or any other property (payable in kind), as the case may
be, into which or for which each share of Common Stock is changed or exchanged.
In the event the Corporation shall at any time after the issuance of any shares
of Series A Preferred Stock declare or pay any dividend on the Common Stock
payable in shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock) into a
greater or lesser number of shares of Common Stock, then in each such case the
amount set forth in the preceding sentence with respect to the exchange or
change of shares of Series A Preferred Stock shall be adjusted by multiplying
such amount by a fraction, the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding immediately
prior to such event.

Section 8. NO REDEMPTION. The shares of Series A Preferred Stock
shall not be redeemable.

Section 9. RANK. The Series A Preferred Stock shall rank, with
respect to the payment of dividends and the distribution of assets, junior to
all series of any other class of the Corporation's Preferred Stock.

Section 10. AMENDMENT. The Certificate of Incorporation of the
Corporation shall not be amended in any manner which would materially alter or
change the powers, preferences or special rights of the Series A Preferred Stock
so as to affect them adversely without the affirmative vote of the holders of at
least two-thirds of the outstanding shares of Series A Preferred Stock, voting
together as a single class.

<PAGE>

CERTIFICATE OF DESIGNATIONS,
PREFERENCES, RIGHTS AND LIMITATIONS OF

Preferred Redeemable Increased Dividend Equity
Securities-SM-, 8% PRIDES-SM-, Convertible Preferred Stock

HILTON HOTELS CORPORATION

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

Pursuant to Section 151 of the General
Corporation Law of the State of Delaware

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

HILTON HOTELS CORPORATION, a corporation organized and existing under the
laws of the State of Delaware (the "Corporation"), hereby certifies that, under
(i) authority conferred upon the Board of Directors by the Restated Certificate
of Incorporation of the Corporation, as amended to date, and (ii) the provisions
of Section 151 of the General Corporation Law of the State of Delaware, the
Board of Directors duly adopted the following resolutions by unanimous written
consent on November 22, 1996:

RESOLVED, that under authority conferred upon the Board of Directors
by the Restated Certificate of Incorporation, as amended (the "Restated
Certificate of Incorporation"), that pursuant to Article IV of the Restated
Certificate of Incorporation, there is hereby authorized such series of
preferred stock on the terms and with the provisions herein set forth, to
be set forth in a certificate of designations (the "Certificate of
Designations"):

Section 1. DESIGNATION AND SIZE OF ISSUE; RANKING. (a) The series of
preferred stock authorized hereby shall be designated as the "Preferred
Redeemable Increased Dividend Equity Securities-SM-, 8% PRIDES-SM-, Convertible
Preferred Stock" (the "PRIDES"). The number of shares constituting the PRIDES
shall be 14,832,700 shares. Each share of PRIDES shall have a stated
liquidation value of $11.125.

(b) Any shares of the PRIDES which at any time have been redeemed for,
or converted into, Common Stock, par value $2.50, of the Corporation (the
"Common Stock") or otherwise reacquired by the Corporation shall, after such
redemption, conversion or other

- ------------------------
- -SM- SERVICE MARK OF MERRILL LYNCH & CO., INC.

<PAGE>

acquisition, resume the status of authorized and unissued shares of preferred
stock, par value $1.00 of the Corporation (the "Preferred Stock"), without
designation as to series until such shares are once more designated as part of a
particular series by the Board of Directors.

(c) The shares of PRIDES shall rank on a parity, both as to payment of
dividends and distribution of assets upon liquidation, with any Preferred Stock
issued by the Corporation after the date of this Certificate of Designations
that by its terms ranks pari passu with the PRIDES ("Parity Preferred Stock").

Section 2. DIVIDENDS. (a) The holders of record of the shares of PRIDES
shall be entitled to receive, when and as declared by the Board of Directors out
of funds legally available therefor, cash dividends ("Preferred Dividends") from
the date of the issuance of the shares of PRIDES (subject to the provisos set
forth below) at the rate per annum of 8 percent of the stated liquidation value
per share (equivalent to $.89 per annum or $.2225 per quarter for each share of
PRIDES), payable quarterly in arrears, on each January 3, April 3, July 3 and
October 3 (each a "Dividend Payment Date") or, if any such date is not a
business day (as defined herein), the Preferred Dividend due on such Dividend
Payment Date shall be paid on the next succeeding business day; PROVIDED,
HOWEVER, that, with respect to any dividend period during which a redemption
occurs, the Corporation may, at its option, declare accrued Preferred Dividends
to, and pay such Preferred Dividends on, the date fixed for redemption, in which
case such Preferred Dividends shall be payable to the holders of shares of
PRIDES as of the record date for such dividend payment and shall not be included
in the calculation of the related PRIDES Call Price (as defined herein). Subject
to the provisos set forth below, the first dividend period shall be from the
date of initial issuance of the shares of PRIDES to but excluding January 3,
1997, and the first Preferred Dividend shall be payable on January 3, 1997.
Preferred Dividends on shares of PRIDES shall be cumulative and shall accumulate
from the date of original issuance; PROVIDED, HOWEVER, that all accumulated
dividends on the Bally Entertainment Corporation ("Bally") Preferred Redeemable
Increased Dividend Equity Securities, 8% PRIDES, Convertible Preferred Stock
(the "Bally PRIDES") as of the effective time of the Merger (the "Merger") of
Bally with and into the Corporation shall become accumulated dividends on the
PRIDES exchanged therefor, payable on the first dividend payment date following
the Merger (and such dividends shall not be payable with respect to Bally
PRIDES); PROVIDED, FURTHER, however, that in the event the Merger occurs on or
after the record date for a dividend on the Bally PRIDES but prior to the
payment date for such dividend, then such dividend shall be payable with respect
to the Bally PRIDES (and shall not constitute an accumulated dividend on the
PRIDES), and dividends shall commence accruing on the PRIDES as of the payment
date for such dividend (payable on the next succeeding payment date). Preferred
Dividends on shares of PRIDES shall cease to accrue on and after the Mandatory
Conversion Date (as defined herein) or on and after the date of their earlier
conversion or redemption, as the case may be. Preferred Dividends shall be
payable to holders of record as they appear on the stock register of the
Corporation on such record date, not less than 15 nor more than 60 days
preceding the payment date thereof, as shall be fixed by the Board of Directors.
Preferred Dividends payable on shares of PRIDES for any period less than a full
quarterly dividend period (or, in the case of the first Preferred Dividend,
subject to the provisos set

<PAGE>

forth above, from the date of initial issuance of the shares of PRIDES to but
excluding the first Dividend Payment Date) shall be computed on the basis of a
360-day year of twelve 30-day months and the actual number of days elapsed in
any period less than one month. Preferred Dividends shall accrue on a daily
basis whether or not there are funds of the Corporation legally available for
the payment of such dividends and whether or not such Preferred Dividends are
declared. Accrued but unpaid Preferred Dividends shall cumulate as of the
Dividend Payment Date on which they first become payable, but no interest shall
accrue on accumulated but unpaid Preferred Dividends.

(b) As long as shares of PRIDES are outstanding, no dividends (other
than dividends payable in shares of, or warrants, rights or options exercisable
for or convertible into, shares of Common Stock or any other capital stock of
the Corporation ranking junior to the shares of PRIDES as to the payment of
dividends and the distribution of assets upon liquidation (collectively, the
"Junior Stock") and cash in lieu of fractional shares of such Junior Stock in
connection with any such dividend) shall be paid or declared in cash or
otherwise, nor shall any other distribution be made (other than a distribution
payable in Junior Stock and cash in lieu of fractional shares of such Junior
Stock in connection with any such distribution), on any Junior Stock unless: (i)
full dividends on Preferred Stock (including the shares of PRIDES) that does not
constitute Junior Stock ("Senior Preferred Stock") have been paid, or declared
and set aside for payment, for all dividend periods terminating at or before the
date of such Junior Stock dividend or distribution payment to the extent such
dividends are cumulative; (ii) dividends in full for the current quarterly
dividend period have been paid, or declared and set aside for payment, on all
Senior Preferred Stock to the extent such dividends are cumulative; (iii) the
Corporation has paid or set aside all amounts, if any, then or theretofore
required to be paid or set aside for all purchase, retirement, and sinking
funds, if any, for any Senior Preferred Stock; and (iv) the Corporation is not
in default on any of its obligations to redeem any Senior Preferred Stock.

(c) As long as any shares of PRIDES are outstanding, no shares of any
Junior Stock may be purchased, redeemed, or otherwise acquired by the
Corporation or any of its subsidiaries (except in connection with a
reclassification or exchange of any Junior Stock through the issuance of other
Junior Stock (and cash in lieu of fractional shares of such Junior Stock in
connection therewith) or the purchase, redemption or other acquisition of any
Junior Stock with any Junior Stock (and cash in lieu of fractional shares in
connection therewith)) nor may any funds be set aside or made available for any
sinking fund for the purchase or redemption of any Junior Stock unless: (i) full
dividends on Senior Preferred Stock have been paid, or declared and set aside
for payment, for all dividend periods terminating at or before the date of such
purchase, redemption or other acquisition to the extent such dividends are
cumulative; (ii) dividends in full for the current quarterly dividend period
have been paid, or declared and set aside for payment, on all Senior Preferred
Stock to the extent such dividends are cumulative; (iii) the Corporation has
paid or set aside all amounts, if any, then or theretofore required to be paid
or set aside for all purchase, retirement and sinking funds, if any, for any
Senior Preferred Stock; and (iv) the Corporation is not in default on any of its
obligations to redeem any Senior Preferred Stock.

<PAGE>

(d) As long as any shares of PRIDES are outstanding, dividends or
other distributions may not be declared or paid on any Parity Preferred Stock
(other than dividends or other distributions payable in Junior Stock and cash in
lieu of fractional shares of such Junior Stock in connection therewith) and the
Corporation may not purchase, redeem or otherwise acquire any Parity Preferred
Stock (except with any Junior Stock and cash in lieu of fractional shares of
such Junior Stock in connection therewith), unless either (a) (i) full dividends
on Senior Preferred Stock have been paid, or declared and set aside for payment,
for all dividend periods terminating at or before the date of such Parity
Preferred Stock dividend, distribution, purchase, redemption or other
acquisition payment to the extent such dividends are cumulative; (ii) dividends
in full for the current quarterly dividend period have been paid, or declared
and set aside for payment, on all Senior Preferred Stock to the extent such
dividends are cumulative; (iii) the Corporation has paid or set aside all
amounts, if any, then or theretofore required to be paid or set aside for all
purchase, retirement, and sinking funds, if any, for any Senior Preferred Stock;
and (iv) the Corporation is not in default on any of its obligations to redeem
any Senior Preferred Stock; or (b) with respect to the payment of dividends
only, any such dividends on the Parity Preferred Stock shall be declared and
paid pro rata so that the amounts of any dividends declared and paid per share
of PRIDES and each other share of Senior Preferred Stock shall in all cases bear
to each other the same ratio that accrued dividends (including any accumulation
with respect to unpaid dividends for prior dividend periods, if such dividends
are cumulative) per share of PRIDES and such other shares of Parity Preferred
Stock bear to each other.

Section 3. CONVERSION OR REDEMPTION. (a) Unless previously either
redeemed or converted at the option of the holder in accordance with the
provisions of Section 3(c), on October 3, 1999 (the "Mandatory Conversion
Date"), each outstanding share of PRIDES shall mandatorily convert ("Mandatory
Conversion") into (i) shares of authorized Common Stock at the PRIDES Common
Equivalent Rate (as defined herein) in effect on the Mandatory Conversion Date
and (ii) the right to receive cash in an amount equal to all accrued and unpaid
Preferred Dividends on such share of PRIDES (other than previously declared
dividends payable to a holder of record as of a prior date) to the Mandatory
Conversion Date, whether or not declared, out of funds legally available for the
payment of Preferred Dividends, subject to the right of the Corporation to
redeem the shares of PRIDES on or after October 3, 1998 (the "Initial Redemption
Date"), and before the Mandatory Conversion Date, and subject to the conversion
of the shares of PRIDES at the option of the holder at any time before the
Mandatory Conversion Date. The "PRIDES Common Equivalent Rate" shall initially
be 1.12 shares of Common Stock for each share of PRIDES and shall be subject to
adjustment as set forth in Sections 3(d) and 3(e) below. Shares of PRIDES shall
cease to be outstanding from and after the Mandatory Conversion Date. The
Corporation shall make such arrangements as it deems appropriate for the
issuance of certificates representing shares of Common Stock and for the payment
of cash in respect of such accrued and unpaid dividends, if any, or cash in lieu
of fractional shares of Common Stock, if any, in exchange for and contingent
upon surrender of certificates representing shares of PRIDES, and the
Corporation may defer the payment of dividends on such shares of Common Stock
and the voting thereof until, and make such payment and voting contingent upon,
the surrender of certificates representing the shares of PRIDES; PROVIDED that
the

<PAGE>

Corporation shall give the holders of the shares of PRIDES such notice of any
such actions as the Corporation deems appropriate and upon surrender such
holders shall be entitled to receive such dividends declared and paid, if any,
on such shares of Common Stock subsequent to the Mandatory Conversion Date.

(b) (i) Shares of PRIDES are not redeemable by the Corporation before
the Initial Redemption Date. At any time and from time to time on or after the
Initial Redemption Date until immediately before the Mandatory Conversion Date,
the Corporation shall have the right to redeem, in whole or in part, the
outstanding shares of PRIDES (subject to the notice provisions set forth in
Section 3(b)(iv)). Upon any such redemption, the Corporation shall deliver to
each holder thereof, in exchange for each such share of PRIDES subject to
redemption, the greater of (A) the number of shares of Common Stock equal to the
applicable PRIDES Call Price (as defined herein) in effect on the redemption
date divided by the Current Market Price (as defined herein) of the Common
Stock, determined as of the second Trading Day (as defined herein) immediately
preceding the Notice Date (as defined herein); or (B) 0.92 of one share of
Common Stock (the "PRIDES Minimum Redemption Rate" which is subject to
adjustment in the same manner as the PRIDES Optional Conversion Rate (as defined
herein) is adjusted). Preferred Dividends on the shares of PRIDES shall cease to
accrue on and after the date fixed for their redemption.

(ii) The "PRIDES Call Price" of each share of PRIDES shall be the
sum of (x) $11.348 on and after the Initial Redemption Date, to and including
January 2, 1999; $11.292 on and after January 3, 1999, to and including April 2,
1999; $11.237 on and after April 3, 1999, to and including July 2, 1999; $11.181
on and after July 3, 1999, to and including September 2, 1999; and $11.125 (the
stated liquidation value of one share of PRIDES) on and after September 3, 1999,
to and including October 3, 1999; and (y) all accrued and unpaid Preferred
Dividends thereon to but not including the date fixed for redemption (other than
previously declared Preferred Dividends payable to a holder of record as of a
prior date). If fewer than all the outstanding shares of PRIDES are to be called
for redemption, shares of PRIDES to be called shall be selected by the
Corporation from outstanding shares of PRIDES not previously called by lot or
pro rata (as nearly as may be) or by any other method determined by the Board of
Directors in its sole discretion to be equitable.

(iii) The term "Current Market Price" per share of the Common
Stock on any date of determination means the lesser of (x) the average of the
Closing Prices (as defined herein) of the Common Stock for the 15 consecutive
Trading Days ending on and including such date of determination, and (y) the
Closing Price of the Common Stock on such date of determination; PROVIDED,
HOWEVER, that, with respect to any redemption of shares of PRIDES, if any event
resulting in an adjustment of the PRIDES Common Equivalent Rate occurs during
the period beginning on the first day of such 15-day period and ending on the
applicable redemption date, the Current Market Price as determined pursuant to
the foregoing shall be appropriately adjusted to reflect the occurrence of such
event.

(iv) The Corporation shall provide notice of any redemption of
the

<PAGE>

shares of PRIDES to holders of record of the shares of PRIDES to be called for
redemption not less than 30 nor more than 60 days before the date fixed for
redemption. Any such notice shall be provided by mail, sent to the holders of
record of the shares of PRIDES to be called at each such holder's address as it
appears on the stock register of the Corporation, first-class postage prepaid;
PROVIDED, HOWEVER, that failure to give such notice or any defect therein shall
not affect the validity of the proceeding for redemption of any shares of PRIDES
to be redeemed except as to the holder to whom the Corporation has failed to
give such notice or whose notice was defective. A public announcement of any
call for redemption shall be made by the Corporation before, or at the time of,
the mailing of such notice of redemption. The term "Notice Date" with respect
to any notice given by the Corporation in connection with a redemption of the
shares of PRIDES means the earlier of the date of the public announcement of
such redemption and the date of the commencement of mailing of such notice to
the holders of shares of PRIDES, in each case pursuant to this Section 3(b)(iv).

Each such notice shall state, as appropriate, the following and may contain
such other information as the Corporation deems advisable:

(A) the redemption date;

(B) that all outstanding shares of PRIDES are to be redeemed
or, in the case of a redemption of fewer than all outstanding shares of
PRIDES, the number of such shares held by such holder to be redeemed;

(C) the PRIDES Call Price, the number of shares of Common
Stock deliverable upon redemption of each share of PRIDES to be redeemed
and the Current Market Price used to calculate such number of shares of
Common Stock;

(D) the place or places where one or more certificates for
such shares of PRIDES are to be surrendered for redemption; and

(E) that dividends on the shares of PRIDES to be redeemed
shall cease to accrue on and after such redemption date (except as
otherwise provided herein).

(v) The Corporation's obligation to deliver shares of Common
Stock and provide funds upon redemption in accordance with this Section 3(b)
shall be deemed fulfilled if, on or before a redemption date, the Corporation
shall deposit with a bank or trust company, or an affiliate of a bank or trust
company, having a combined capital and surplus of at least $50,000,000 according
to its last published statement of condition, or shall set aside or make other
reasonable provision for the issuance of, such number of shares of Common Stock
as are required to be delivered by the Corporation pursuant to this Section 3(b)
upon the occurrence of the related redemption of shares of PRIDES and for the
payment of cash in lieu of the issuance of fractional share amounts and accrued
and unpaid dividends payable in cash on the shares of PRIDES to be redeemed as
required by this Section 3(b), in trust for the account of the holders of such
shares of PRIDES to be redeemed (and so as to

<PAGE>

be and continue to be available therefor), with irrevocable instructions and
authority to such bank or trust company that such shares and funds be delivered
upon redemption of the shares of PRIDES so called for redemption. Any interest
accrued on such funds shall be paid to the Corporation from time to time. Any
shares of Common Stock or funds so deposited and unclaimed at the end of three
years from such redemption date shall be repaid and released to the Corporation,
after which the holder or holders of such shares of PRIDES so called for
redemption shall look only to the Corporation for delivery of shares of Common
Stock and the payment of any other funds due in connection with the redemption
of the shares of PRIDES.

(vi) Each holder of shares of PRIDES called for redemption must
surrender the certificates evidencing such shares (properly endorsed or assigned
for transfer, if the Board of Directors shall so require and the notice shall so
state) to the Corporation at the place designated in the notice of such
redemption and shall thereupon be entitled to receive certificates evidencing
shares of Common Stock and to receive any funds payable pursuant to this Section
3(b) following such surrender and following the date of such redemption. In case
fewer than all the shares represented by any such surrendered certificate are
called for redemption, a new certificate shall be issued at the expense of the
Corporation representing the unredeemed shares. If such notice of redemption
shall have been given, and if on the date fixed for redemption shares of Common
Stock and funds necessary for the redemption shall have been irrevocably either
set aside by the Corporation separate and apart from its other funds or assets
in trust for the account of the holders of the shares to be redeemed (and so as
to be and continue to be available therefor) or deposited with a bank or trust
company or an affiliate thereof as provided herein or the Corporation shall have
made other reasonable provision therefor, then notwithstanding that the
certificates evidencing any shares of PRIDES so called for redemption shall not
have been surrendered, the shares represented thereby so called for redemption
shall be deemed no longer outstanding and Preferred Dividends with respect to
the shares so called for redemption and all rights with respect to the shares so
called for redemption shall forthwith on and after such date cease and terminate
(unless the Corporation defaults on the payment of the redemption price), except
for (i) the rights of the holders to receive the shares of Common Stock and
funds, if any, payable pursuant to this Section 3(b) without interest upon
surrender of their certificates therefor and (ii) the right of the holders,
pursuant to Section 3(c) to convert the shares of PRIDES called for redemption
until immediately before the close of business on any redemption date; PROVIDED,
HOWEVER, that holders of shares of PRIDES at the close of business on a record
date for any payment of Preferred Dividends shall be entitled to receive the
Preferred Dividend payable on such shares on the corresponding Dividend Payment
Date notwithstanding the redemption of such shares following such record date
and before the Dividend Payment Date. Holders of shares of PRIDES that are
redeemed shall not be entitled to receive dividends declared and paid on such
shares of Common Stock, and such shares of Common Stock shall not be entitled to
vote, until such shares of Common Stock are issued upon the surrender of the
certificates representing such shares of PRIDES, and upon such surrender such
holders shall be entitled to receive such dividends declared and paid on such
shares of Common Stock subsequent to such redemption date.

<PAGE>

(vii) Notwithstanding the provisions of this Section 3(b), the
shares of PRIDES shall be subject to regulatory redemption pursuant to Article X
of the Restated Certificate of Incorporation of the Corporation, as amended to
date.

(c) Shares of PRIDES are convertible, in whole or in part, at the
option of the holders thereof ("Optional Conversion"), at any time before the
Mandatory Conversion Date, unless previously redeemed, into shares of Common
Stock at a rate of .92 shares of Common Stock for each share of PRIDES (the
"PRIDES Optional Conversion Rate"), subject to adjustment as set forth below.
The right of Optional Conversion of shares of PRIDES called for redemption shall
terminate immediately before the close of business on any redemption date with
respect to such shares.

Optional Conversion of shares of PRIDES may be effected by delivering
certificates evidencing such shares of PRIDES, together with written notice of
conversion and a proper assignment of such certificates to the Corporation or in
blank (and, if applicable, cash payment of an amount equal to the Preferred
Dividend attributable to the current quarterly dividend period payable on such
shares), to the office of the transfer agent for the shares of PRIDES or to any
other office or agency maintained by the Corporation for that purpose and
otherwise in accordance with Optional Conversion procedures established by the
Corporation. Each Optional Conversion shall be deemed to have been effected
immediately before the close of business on the date on which the foregoing
requirements shall have been satisfied. The Optional Conversion shall be at the
PRIDES Optional Conversion Rate in effect at such time and on such date.

Holders of shares of PRIDES at the close of business on a record date for
any payment of declared Preferred Dividends shall be entitled to receive the
Preferred Dividend payable on such shares of PRIDES on the corresponding
Dividend Payment Date notwithstanding the Optional Conversion of such shares of
PRIDES following such record date and before such Dividend Payment Date.
However, shares of PRIDES surrendered for Optional Conversion after the close of
business on a record date for any payment of declared Preferred Dividends and
before the opening of business on the next succeeding Dividend Payment Date must
be accompanied by payment in cash of an amount equal to the Preferred Dividends
attributable to the current quarterly dividend period payable on such date
(unless such shares of PRIDES are subject to redemption on a redemption date
between such record date established for such Dividend Payment Date and such
Dividend Payment Date). Except as provided above, upon any Optional Conversion
of shares of PRIDES, the Corporation shall make no payment of or allowance for
unpaid Preferred Dividends, whether or not in arrears, on such shares of PRIDES
as to which Optional Conversion has been effected or for previously declared
dividends or distributions on the shares of Common Stock issued upon Optional
Conversion.

(d) The PRIDES Common Equivalent Rate, the PRIDES Minimum Redemption
Rate and the PRIDES Optional Conversion Rate (collectively, referred to as the
"Rates") are each subject to adjustment from time to time as provided below in
this paragraph (d).

<PAGE>

(i) If the Corporation shall pay a stock dividend or make a
distribution with respect to its Common Stock in shares of Common Stock
(including by way of reclassification of any shares of its Common Stock), the
Rates in effect at the opening of business on the day following the date fixed
for the determination of stockholders entitled to receive such dividend or other
distribution shall each be increased by multiplying such Rates by a fraction of
which the numerator shall be the sum of the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination,
immediately before such dividend or distribution, plus the total number of
shares of Common Stock constituting such dividend or other distribution, and of
which the denominator shall be the number of shares of Common Stock outstanding
at the close of business on the date fixed for such determination, immediately
before such dividend or distribution, such increase to become effective
immediately after the opening of business on the day following the date fixed
for such determination. For the purposes of this clause (i), the number of
shares of Common Stock at any time outstanding shall not include shares held in
the treasury of the Corporation but shall include shares issuable in respect of
certificates issued in lieu of fractions of shares of Common Stock.

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

(iii) If the Corporation shall, after the date of this
Certificate of Designations, issue rights or warrants to all holders of its
Common Stock entitling them (for a period not exceeding 45 days from the date of
such issuance) to subscribe for or purchase shares of Common Stock at a price
per share less than the Current Market Price of the Common Stock (determined
pursuant to Section 3(b)(ii)) on the record date for the determination of
stockholders entitled to receive such rights or warrants, then in each case the
Rates shall each be adjusted by multiplying the Rates in effect on such record
date by a fraction of which the numerator shall be the number of shares of
Common Stock outstanding on the date of issuance of such rights or warrants,
immediately before such issuance, plus the number of additional shares of Common
Stock offered for subscription or purchase pursuant to such rights or warrants,
and of which the denominator shall be the number of shares of Common Stock
outstanding on the date of issuance of such rights or warrants, immediately
before such issuance, plus the number of shares of Common Stock which the
aggregate offering price of the total number of shares of Common Stock so
offered for subscription or purchase pursuant to such rights or warrants would
purchase at such Current Market Price (determined by multiplying such total
number of shares by the exercise price of such rights or warrants and dividing
the product so obtained by such Current Market Price). Shares of Common Stock
held by the Corporation or by another corporation of which a majority of the

<PAGE>

shares entitled to vote in the election of directors are held, directly or
indirectly, by the Corporation shall not be deemed to be outstanding for
purposes of such computation. Such adjustment shall become effective at the
opening of business on the business day next following the record date for the
determination of stockholders entitled to receive such rights or warrants. To
the extent that shares of Common Stock are not delivered after the expiration of
such rights or warrants, the Rates shall each be readjusted to the Rates which
would then be in effect had the adjustments made after the issuance of such
rights or warrants been made upon the basis of issuance of rights or warrants in
respect of only the number of shares of Common Stock actually delivered.

(iv) If the Corporation shall pay a dividend or make a
distribution to all holders of its Common Stock consisting of evidences of its
indebtedness, cash or other assets (including shares of capital stock of the
Corporation other than Common Stock and shares of capital stock of any other
corporation, but excluding any cash dividends or distributions, other than
Extraordinary Cash Distributions (as defined herein) and dividends referred to
in clause (i) above), or shall issue to all holders of its Common Stock rights
or warrants to subscribe for or purchase any of its securities (other than those
referred to in clause (iii) above), then in each such case, the Rates shall each
be adjusted by multiplying such Rates in effect on the record date for such
dividend or distribution or for the determination of stockholders entitled to
receive such rights or warrants, as the case may be, by a fraction of which the
numerator shall be the Current Market Price per share of the Common Stock
(determined pursuant to 3(b)(ii) on such record date), and of which the
denominator shall be such Current Market Price per share of Common Stock less
either (i) the fair market value (as determined by the Board of Directors, whose
determination shall be conclusive) on such record date of the portion of the
assets or evidences of indebtedness so distributed, or of such subscription
rights or warrants, applicable to one share of Common Stock, or (ii) if
applicable, the amount of the Extraordinary Cash Distributions. Such adjustment
shall become effective on the opening of business on the business day next
following the record date for such dividend or distribution or for the
determination of holders entitled to receive such rights or warrants, as the
case may be.

(v) Any shares of Common Stock issuable in payment of a dividend
or other distribution (other than as described in clause (i) above) shall be
deemed to have been issued immediately before the close of business on the
record date for such dividend or other distribution for purposes of calculating
the number of outstanding shares of Common Stock under this Section 3.

(vi) Anything in this Section 3 notwithstanding, the Corporation
shall be entitled (but shall not be required) to make such upward adjustments in
the Rates and the PRIDES Call Price in addition to those set forth by this
Section 3, as the Corporation, in its sole discretion, shall determine to be
advisable, in order that any stock dividends, subdivision of stock, distribution
of rights to purchase stock or securities, or distribution of securities
convertible into or exchangeable for stock (or any transaction that could be
treated as any of the foregoing transactions pursuant to Section 305 of the
Internal Revenue Code of 1986, as amended) hereafter made by the Corporation to
its stockholders shall not be taxable. The

<PAGE>

term "Extraordinary Cash Distribution" means, with respect to any consecutive
12-month period, all cash dividend and cash distributions on the Common Stock
during such period (other than cash dividends and cash distributions for which a
prior adjustment to the Rates was previously made) to the extent such dividends
and distributions exceed, on a per share of Common Stock basis, 10% of the
average daily Closing Price of the Common Stock over such period.

(vii) In any case in which this Section 3(d) shall require that
an adjustment as a result of any event become effective at the opening of
business on the business day next following a record date and the date fixed for
conversion pursuant to Section 3(a) or redemption pursuant to Section 3(b)
occurs after such record date, but before the occurrence of such event, the
Corporation may, in its sole discretion, elect to defer the following until
after the occurrence of such event or the date of final determination of such
fair market value; (A) issuing to the holder of any shares of PRIDES surrendered
for conversion or redemption the additional shares of Common Stock issuable over
the shares of Common Stock issuable before giving effect to such adjustment; and
(B) paying to such holder any amount in cash in lieu of a fractional share of
Common Stock pursuant to Section 4.

(viii) All adjustments to the Rates shall be calculated to the
nearest 1/100th of a share of Common Stock. No adjustment in any of the Rates
shall be required unless such adjustment would require an increase or decrease
of at least one percent therein; PROVIDED, HOWEVER, that any adjustments which
by reason of this Section 3(d) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All adjustments to
the Rates shall be made successively.

(ix) Before redeeming any shares of PRIDES, the Corporation shall
take any corporate action which may, in the opinion of its counsel, be necessary
in order that the Corporation may validly and legally issue fully paid and
nonassessable shares of Common Stock upon such redemption.

(e) In case of any consolidation or merger to which the Corporation is
a party (other than a consolidation or merger in which the Corporation is the
surviving or continuing corporation and in which the shares of Common Stock
outstanding immediately before the merger or consolidation remain unchanged) or
in the case of any sale or transfer to another corporation of the property of
the Corporation as an entirety or substantially as an entirety, or in the case
of a statutory exchange of securities with another corporation (other than in
connection with a merger or acquisition), each share of PRIDES shall, after
consummation of such transaction, be subject to (i) conversion at the option of
the holder into the kind and amount of securities, cash, or other property
receivable upon consummation of such transaction by a holder of the number of
shares of Common Stock into which such shares of PRIDES might have been
converted immediately before consummation of such transaction, (ii) conversion
on the Mandatory Conversion Date into the kind and amount of securities, cash,
or other property receivable upon consummation of such transaction by a holder
of the number of shares of Common Stock into which such share of PRIDES would
have been

<PAGE>

converted if the conversion on the Mandatory Conversion Date had occurred
immediately before the date of consummation of such transaction, plus the right
to receive cash in an amount equal to all accrued and unpaid dividends on such
share of PRIDES (other than previously declared dividends payable to a holder of
record as of a prior date), and (iii) redemption on any redemption date in
exchange for the kind and amount of securities, cash, or other property
receivable upon consummation of such transaction by a holder of the number of
shares of Common Stock that would have been issuable at the PRIDES Call Price in
effect on such redemption date upon a redemption of such share of PRIDES
immediately before consummation of such transaction, assuming that, if the
Notice Date for such redemption is not before such transaction, the Notice Date
had been the date of such transaction; and assuming in each case that such
holder of shares of Common Stock failed to exercise rights of election, if any,
as to the kind or amount of securities, cash, or other property receivable upon
consummation of such transaction (PROVIDED that, if the kind or amount of
securities, cash, or other property receivable upon consummation of such
transaction is not the same for each non-electing share, then the kind and
amount of securities, cash, or other property receivable upon consummation of
such transaction for each non-electing share shall be deemed to be the kind and
amount so receivable per share by a plurality of the non-electing shares). The
kind and amount of securities into or for which the shares of PRIDES shall be
convertible or redeemable after consummation of such transaction shall be
subject to adjustment as described in Section 3(d) following the date of
consummation of such transaction. The Corporation may not become a party to any
such transaction unless the terms thereof are consistent with the foregoing.

(f) Whenever the Rates are adjusted as provided in Section 3(d), the
Corporation shall:

(i) forthwith compute the Rates in accordance with this Section 3
and prepare a certificate signed by the President and Chief Executive Officer,
the Executive Vice President and Chief Financial Officer, the Vice President
and Treasurer, Vice President and General Counsel, the Vice President and
Corporate Controller or the Vice President and Corporate Secretary of the
Corporation setting forth the adjusted Rates, the method of calculation thereof
in reasonable detail and the facts requiring such adjustment and upon which such
adjustment is based, which certificate shall be conclusive, final and binding
evidence of the correctness of the adjustment, and shall file such certificate
forthwith with the transfer agent for the shares of the PRIDES and the Common
Stock;

(ii) make a prompt public announcement stating that the Rates
have been adjusted and setting forth the adjusted Rates; and

(iii) mail a notice stating that the Rates have been adjusted,
the facts requiring such adjustment and upon which such adjustment is based and
setting forth the adjusted Rates, to the holders of record of the outstanding
shares of PRIDES, at or prior to the time the Corporation mails an interim
statement, if any, to its stockholders covering the fiscal quarter period during
which the facts requiring such adjustment occurred, but in any event within 45
days of the end of such fiscal quarter period.

<PAGE>

(g) In case, at any time while any of the shares of PRIDES are
outstanding,

(i) the Corporation shall declare a dividend (or any other
distribution) on the Common Stock, excluding any cash dividends other than
Extraordinary Cash Distributions; or

(ii) the Corporation shall authorize the issuance to all holders
of the Common Stock of rights or warrants to subscribe for or purchase shares of
the Common Stock or of any other subscription rights or warrants; or

(iii) the Corporation shall authorize any reclassification of the
Common Stock (other than a subdivision or combination thereof) or any
consolidation or merger to which the Corporation is a party and for which
approval of any stockholders of the Corporation is required (except for a merger
of the Corporation into one of its subsidiaries solely for the purpose of
changing the corporate domicile of the Corporation to another state of the
United States and in connection with which there is no substantive change in the
rights or privileges of any securities of the Corporation other than changes
resulting from differences in the corporate statutes of the state the
Corporation was then domiciled in and the new state of domicile), or the sale or
transfer of all or substantially all of the assets of the Corporation; then the
Corporation shall cause to be filed at each office or agency maintained for the
purpose of conversion of the shares of PRIDES, and shall cause to be mailed to
the holders of shares of PRIDES at their last addresses as they shall appear on
the stock register of the Corporation, at least 10 business days before the date
hereinafter specified in clause (A) or (B) below (or the earlier of the dates
hereinafter specified, in the event that more than one date is specified), a
notice stating (A) the date on which a record is to be taken for the purpose of
such dividend, distribution, rights or warrants, or, if a record is not be
taken, the date as of which the holders of Common Stock of record to be entitled
to such dividend, distribution, rights or warrants are to be determined, or (B)
the date on which any such reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding up is expected to become
effective, and the date as of which it is expected that holders of Common Stock
of record shall be entitled to exchange their Common Stock for securities or
other property (including cash), if any, deliverable upon such reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding up.
The failure to give or receive the notice required by this paragraph (g) or any
defect therein shall not affect the legality or validity of any such dividend,
distribution, right or warrant or other action.

Section 4. NO FRACTIONAL SHARES. No fractional shares of Common Stock shall
be issued upon redemption or conversion of any shares of the PRIDES. In lieu of
any fractional share otherwise issuable in respect of the aggregate number of
shares of the PRIDES of any holder that are redeemed or converted on any
redemption date or upon Mandatory Conversion or Optional Conversion, such holder
shall be entitled to receive an amount in cash (computed to the nearest cent)
equal to the same fraction of the (i) Current Market Price of the Common Stock
(determined as of the second Trading Day immediately preceding the Notice Date)
in the case of redemption, or (ii) Closing Price of the Common Stock determined
(A) as of the fifth Trading Day immediately preceding the Mandatory Conversion

<PAGE>

Date, in the case of Mandatory Conversion, or (B) as of the second Trading Day
immediately preceding the effective date of conversion, in the case of an
Optional Conversion by a holder. If more than one share of PRIDES shall be
surrendered for conversion or redemption at one time by or for the same holder,
the number of full shares of Common Stock issuable upon conversion thereof shall
be computed on the basis of the aggregate number of shares of the PRIDES so
surrendered or redeemed.

Section 5. RESERVATION OF COMMON STOCK. The Corporation shall at all
times reserve and keep available out of its authorized and unissued Common
Stock, solely for issuance upon the conversion or redemption of shares of
PRIDES, as herein provided, free from preemptive rights, such maximum number of
shares of Common Stock as shall from time to time be issuable upon the Mandatory
Conversion or Optional Conversion or redemption of all the shares of PRIDES then
outstanding.

Section 6. DEFINITIONS. As used in this Certificate of Designations:

(i) the term "business day" shall mean any day other than a
Saturday, Sunday, or a day on which banking institutions in the State of New
York are authorized or obligated by law or executive order to close;

(ii) the term "Closing Price", on any day, shall mean the last
reported sales price of the Common Stock, regular way on such day, or, if no
sale takes place on such day, the average of the reported closing bid and asked
prices on such day, regular way, in either case as reported on the New York
Stock Exchange or, if such security is not listed or admitted for trading on the
New York Stock Exchange, on the Nasdaq National Market of the National
Association of Securities Dealers, Inc. Automated Quotations System ("NASDAQ")
or, if such security is not quoted on such Nasdaq National Market, the average
of the closing bid and asked prices on such day in the over-the-counter market
as reported by NASDAQ or, if bid and asked prices for such security on such day
shall not have been reported through NASDAQ, the average of the bid and asked
prices on such day, as furnished by any New York Stock Exchange member firm
making a market in the Common Stock selected from time to time by the Board of
Directors for that purpose;

(iii) the term "record date" shall be such date as from time to
time shall be fixed by the Board of Directors with respect to the receipt of
dividends, the receipt of a redemption price upon redemption or the taking of
any action or exercise of any voting rights permitted hereby; and

(iv) the term "Trading Day" shall mean a date on which the New
York Stock Exchange (or any successor) is open for the transaction of business.

Section 7. PAYMENT OF TAXES. The Corporation shall pay any and all
documentary, stamp or similar issue or transfer taxes payable in respect of the
issue or delivery of shares of Common Stock on the redemption or conversion of
shares of PRIDES pursuant to Section 3; PROVIDED, HOWEVER, that the Corporation
shall not be required to pay any tax which may

<PAGE>

be payable in respect of any registration of transfer involved in the issue or
delivery of shares of Common Stock in a name other than that of the registered
holder of shares of PRIDES redeemed or converted or to be redeemed or converted,
and no such issue or delivery shall be made unless and until the person
requesting such issue has paid to the Corporation the amount of any such tax or
has established, to the satisfaction of the Corporation, that such tax has been
paid.

Section 8. LIQUIDATION RIGHTS. In the event of any voluntary or
involuntary liquidation, dissolution, or winding up of the Corporation, and
subject to the rights of holders of any other series of Preferred Stock, the
holders of outstanding shares of PRIDES are entitled to receive the sum of
$11.125 per share, plus an amount equal to any accrued and unpaid Preferred
Dividends thereon, out of the assets of the Corporation available for
distribution to stockholders, before any distribution of assets is made to
holders of Junior Stock. If, upon any voluntary or involuntary liquidation,
dissolution, or winding up of the Corporation, the assets of the Corporation are
insufficient to permit the payment of the full preferential amounts payable with
respect to the shares of PRIDES and all other series of Parity Preferred Stock,
the holders of shares of PRIDES and of all other series of Parity Preferred
Stock shall share ratably in any distribution of assets of the Corporation in
proportion to the full respective preferential amounts to which they are
entitled. After payment of the full amount of the liquidating distribution to
which they are entitled, the holders of shares of PRIDES shall not be entitled
to any further participation in any distribution of assets by the Corporation. A
consolidation or merger of the Corporation with or into one or more other
corporations (whether or not the Corporation is the corporation surviving such
consolidation or merger), or a sale, lease or exchange of all or substantially
all of the assets of the Corporation shall not be deemed to be a voluntary or
involuntary liquidation, dissolution, or winding up of the Corporation.

Section 9. VOTING RIGHTS. (a) The holders of shares of PRIDES shall have
the right with the holders of Common Stock to vote in the election of Directors
and upon each other matter coming before any meeting of the holders of Common
Stock on the basis of four-fifths (4/5ths) of a vote for each share of PRIDES
held. The holders of shares of PRIDES and the holders of Common Stock will vote
together as one class on such matters except as otherwise provided by law or the
Restated Certificate of Incorporation of the Corporation.

(b) In the event that dividends on the shares of PRIDES or any other
series of Preferred Stock shall be in arrears and unpaid for six quarterly
dividend periods, or if any series of Preferred Stock (other than the PRIDES)
shall be entitled for any other reason to exercise voting rights, separate from
the Common Stock, to elect any directors of the Corporation ("Preferred Stock
Directors"), the holders of the shares of PRIDES (voting separately as a class
with holders of all other series of Preferred Stock upon which like voting
rights have been conferred and are exercisable with the PRIDES as a class), with
each share of PRIDES entitled to one vote on this and other matters in which
such Preferred Stock votes as a group, shall be entitled to vote for the
election of two directors of the Corporation, such directors to be in addition
to the number of directors constituting the Board of Directors immediately
before the accrual of such right. Such right, when vested, shall continue until
all

<PAGE>

cumulative dividends accumulated and payable on the shares of PRIDES and such
other series of Preferred Stock shall have been paid in full and the right of
any other such series of Preferred Stock to exercise voting rights, separate
from the Common Stock, to elect Preferred Stock Directors shall terminate or
have terminated, and, when so paid and any such termination occurs or has
occurred, such right of the holders of the shares of PRIDES shall cease. The
term of office of any director elected by the holders of the shares of PRIDES
and such other series shall terminate on the earlier of (i) the next annual
meeting of stockholders at which a successor shall have been elected and
qualified or (ii) the termination of the right of holders of the shares of
PRIDES and such other series to vote for such directors.

(c) The Corporation shall not, without the approval of the holders of
at least 66-2/3 percent of the shares of PRIDES then outstanding: (i) amend,
alter, or repeal any of the provisions of the Restated Certificate of
Incorporation of the Corporation so as to affect adversely the powers,
preferences or rights of the holders of the shares of PRIDES then outstanding or
reduce the minimum time for any required notice to which the holders of the
shares of PRIDES then outstanding may be entitled (an amendment of the Restated
Certificate of Incorporation to authorize or create, or to increase the
authorized amount of, Junior Stock or any stock of any class ranking on a parity
with the PRIDES being deemed not to affect adversely the powers, preferences, or
rights of the holders of the shares of PRIDES); (ii) authorize or create, or
increase the authorized amount of, any stock of any class (whether or not
convertible into capital stock of any class), ranking prior to the shares of
PRIDES either as to the payment of dividends or the distribution of assets upon
liquidation, dissolution or winding up of the Corporation; or (iii) merge or
consolidate with or into any other corporation, unless each holder of shares of
PRIDES immediately preceding such merger or consolidation shall receive or
continue to hold in the resulting corporation the same number of shares, with
substantially the same rights and preferences, including, without limitation, as
set forth in Section 3(e) hereof, as correspond to the shares of PRIDES so held.

(d) The Corporation shall not, without the approval of the holders of
at least a majority of the shares of PRIDES then outstanding, increase the
authorized number of shares of Preferred Stock to greater than 60,000,000
shares.

(e) Notwithstanding the provisions set forth in Sections 9(c) and
9(d), no such approval described therein of the holders of the shares of PRIDES
shall be required if, at or before the time when such amendment, alteration or
repeal is to take effect or when the authorization, creation, increase or
issuance of any such prior or parity stock or convertible security is to be
made, or when such consolidation or merger, voluntary liquidation, dissolution,
or winding up, sale, lease, conveyance, purchase, or redemption is to take
effect, as the case may be, provision is made for the redemption of all shares
of PRIDES at the time outstanding.

<PAGE>

IN WITNESS WHEREOF, HILTON HOTELS CORPORATION has caused this certificate
to be signed and attested this 22nd day of November, 1996.

HILTON HOTELS CORPORATION

By: /s/ Matthew J. Hart
-----------------------------------
Name: Matthew J. Hart
Title: Executive Vice President and
Chief Financial Officer

Attest:

/s/ Cheryl L. Marsh
- --------------------------------
Name: Cheryl L. Marsh
Title: Vice President and
Corporate Secretary

50
<PAGE>

CERTIFICATE OF MERGER

MERGING

BALLY ENTERTAINMENT CORPORATION

WITH AND INTO

HILTON HOTELS CORPORATION

The undersigned corporation organized and existing under and by virtue of
the General Corporation Law of the State of Delaware,

DOES HEREBY CERTIFY THAT:

1. The name and state of incorporation of each of the constituent
corporations of the merger is as follows:

NAME STATE OF INCORPORATION
---- ----------------------
Hilton Hotels Corporation ("Hilton") Delaware
Bally Entertainment Corporation ("Bally") Delaware

2. The Boards of Directors of Hilton and Bally have approved an Agreement
and Plan of Merger dated as of June 6, 1996, as amended (the "Agreement of
Merger"), by and between Hilton and Bally, whereby Bally will merge with and
into Hilton pursuant to Section 251 of the Delaware General Corporation Law, so
that the separate existence of Bally will cease as soon as such merger (the
"Merger") becomes effective (the "Effective Date"), and Hilton will assume all
of the liabilities of Bally and thereafter shall continue as the surviving
corporation (the "Surviving Corporation"), governed by the laws of the State of
Delaware, and existing under the corporate name it possesses immediately prior
to the Effective Date.

3. The Agreement of Merger was approved by the holders of a majority of
the outstanding shares of Hilton entitled to vote thereon, and by the holders of
a majority of the votes entitled to be cast by the holders of the outstanding
shares of Bally entitled to vote thereon, in each case by a special meeting of
stockholders held in accordance with Section 211 of the Delaware General
Corporation Law, and with the notice required by said Section 222 having been
sent to each holder.

4. Each of Hilton and Bally have approved, adopted, certified, executed
and acknowledged the Agreement of Merger in accordance with Section 251 of the
General Corporation Law of the State of Delaware.

5. The name of the corporation surviving the Merger is Hilton Hotels
Corporation.

<PAGE>

6. On the Effective Date, the Restated Certificate of Incorporation, as
amended, and Bylaws, as amended, of Hilton in effect immediately prior to the
Effective Date will be the certificate of incorporation and bylaws of the
Surviving Corporation.

7. The executed Agreement of Merger is on file at the principal place of
business of the Surviving Corporation at the following address:

Hilton Hotels Corporation
9336 Civic Center Drive
Beverly Hills, California 90210
Attention: Corporate Secretary

A copy of the Agreement of Merger will be furnished by the Surviving
Corporation, on request and without cost, to any stockholder of either
constituent corporation.

<PAGE>

IN WITNESS WHEREOF, Hilton Hotels Corporation has caused this
Certificate to be signed by its Senior Vice President and General Counsel and
attested by its Secretary, this 18th day of December, 1996.

HILTON HOTELS CORPORATION

By: /s/ William C. Lebo, Jr.
-----------------------------------
William C. Lebo, Jr.
Senior Vice President and
General Counsel

Attest:

/s/ Cheryl L. Marsh
- ------------------------------
Cheryl L. Marsh
Corporate Secretary

<PAGE>

HILTON HOTELS CORPORATION
BY-LAWS
(AS AMENDED JULY 18, 1996)

REGISTERED OFFICE

1. The registered office of Hilton Hotels Corporation in the State of
Delaware shall be identical to the office of the Corporation's registered agent
in the City of Dover, County of Kent. The name of the Corporation's registered
agent in Delaware is United States Corporation Company, with offices currently
at 32 Lookerman Square, Suite L-100, Dover, Delaware or such other location as
it may select in the future.

2. The Corporation may also have an office or offices at such other
places within and without the State of Delaware as the Board of Directors may
from time to time appoint or the business of the Corporation may require.

SEAL

3. The corporate seal shall have inscribed thereon the name of the
Corporation and the words "Corporate Seal, Delaware 1946." Said seal may be
used by causing it or a facsimile thereof to be impressed or affixed or
reproduced or otherwise.

STOCKHOLDERS' MEETINGS

<PAGE>

4. The annual meeting of the stockholders for the election of directors
and for the transaction of such other business as properly may come before such
meeting shall be held on such date, and at such time and place within or without
the State of Delaware as may be designated by the Board of Directors. If the
Board of Directors shall take no action to the contrary, the annual meeting of
stockholders shall be held on the first Thursday in May in each year if not a
legal holiday, and if a legal holiday, then on the next secular day following at
10:00 o'clock a.m., when they shall elect by a plurality vote, by ballot, a
Board of Directors, and transact such other business as may properly be brought
before the meeting.

NOTICE OF STOCKHOLDER BUSINESS

5. At an annual meeting of the stockholders, only such business shall be
conducted as shall have been properly brought before the meeting. To be
properly brought before an annual meeting, business must be (a) specified in the
notice of meeting (or any supplement thereto) given by or at the direction of
the Board of Directors, (b) otherwise properly brought before the meeting by or
at the direction of the Board of Directors, or (c) otherwise properly brought
before the meeting by a stockholder. For business to be properly brought before
an annual meeting by a stockholder, the stockholder must have given timely
notice thereof in writing to the Secretary of the Corporation. To be timely, a

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<PAGE>

stockholder's notice must be delivered to or mailed and received at the
principal executive offices of the Corporation, not less than 60 days prior to
the meeting. A stockholder's notice to the Secretary shall set forth as to each
matter the stockholder proposes to bring before the annual meeting (a) a brief
description of the business desired to be brought before the annual meeting and
the reasons for conducting such business at the annual meeting, (b) the name and
address, as they appear on the Corporation's books, of the stockholder proposing
such business, (c) the class and number of shares of the Corporation which are
beneficially owned by the stockholder, and (d) any material interest of the
stockholder in such business. Notwithstanding anything in the By-Laws to the
contrary, no business shall be conducted at an annual meeting except in
accordance with the procedures set forth in this By-Law. The Chairman of an
annual meeting shall, if the facts warrant, determine and declare to the meeting
that business was not properly brought before the meeting and in accordance with
the provisions of this By-Law, and if the Chairman should so determine, the
Chairman shall so declare to the meeting and any such business not properly
brought before the meeting shall not be transacted.

6. The holders of a majority of the stock issued and outstanding and
entitled to vote thereat, present in person, or represented by proxy, shall be
requisite and shall constitute a quorum at all meetings of the stockholders for
the transaction of business except as otherwise provided by statute, by the

3
<PAGE>

Certificate of Incorporation or by these By-Laws. In the absence of a quorum, a
majority in interest of the stockholders entitled to vote present in person or
by proxy, or, if no stockholders entitled to vote are present in person or by
proxy, any officer entitled to act as secretary of such meeting, may adjourn the
meeting from time to time until a quorum shall be present.

7. Directors shall be chosen by a plurality of the votes cast at the
election.

8. At any meeting of the stockholders, every stockholder having the right
to vote shall be entitled to vote in person, or by proxy appointed by an
instrument in writing subscribed by such stockholder and bearing a date not more
than three years prior to said meeting, unless said instrument provides for a
longer period. Each stockholder shall have one vote for each share of stock
having voting power, registered in each such stockholder's name on the books of
the Corporation, and except where the transfer books of the Corporation shall
have been closed or a date shall have been fixed as a record date for the
determination of its stockholders entitled to vote, no share of stock shall be
voted on at any election of Directors which shall have been transferred on the
books of the Corporation within twenty days next preceding such election of
Directors.

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<PAGE>

9. Written notice of the annual meeting shall be served upon or mailed to
each stockholder entitled to vote thereat at such address as appears on the
stock books of the Corporation, at least ten days prior to the meeting.

10. A complete list of the stockholders entitled to vote at the ensuing
election arranged in alphabetical order, with the residence of each and the
number of voting shares held by each, shall be prepared by the Secretary and
filed in the office where the election is to be held, at least ten days before
every election, and shall at all times be open to the examination of any
stockholder during the usual hours for business for a purpose germane to the
meeting and during the whole time of said election.

11. Written notice, signed by the Chairman of the Board, the President,
any Vice President, the Secretary or the Assistant Corporate Secretary or an
Assistant Secretary, of every meeting of stockholders stating the purpose or
purposes for which the meeting is called, and the date and time, and the place
where it is to be held shall be delivered either personally or by mail, to each
stockholder entitled to vote at such meeting not less than ten nor more than
fifty days before the meeting, except as otherwise provided by statute. If
mailed, such notice shall be directed to a stockholder at such stockholder's
address as it shall appear on the stock books of the Corporation, unless such
stockholder shall have filed with the Secretary a written request that notices

5
<PAGE>

intended for such stockholder be mailed to some other address, in which case it
shall be mailed to the address designated in such request.

12. In the absence of a quorum, a majority in interest of the stockholders
entitled to vote, present in person or by proxy, or if no stockholder entitled
to vote is present in person or by proxy, any officer entitled to preside or act
as secretary of such meeting, may adjourn the meeting from time to time until a
quorum shall be present.

13. The Board of Directors may appoint judges of election to serve at any
election of directors and at balloting on any other matter that may properly
come before a meeting of stockholders. If no such appointment shall be made, or
if any of the judges so appointed shall fail to attend, or refuse or be unable
to serve, then such appointment may be made by the presiding officer at the
meeting.

STOCKHOLDER ACTION

14. Subject to the rights of the holders of any class or series of stock
having a preference over the Common Stock as to dividends or upon liquidation,
any action required or permitted to be taken by the stockholders of the
Corporation must be effected at a duly called annual or special meeting of such
holders and may not

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<PAGE>

be effected by any consent in writing by such holders. Subject to the rights of
the holders of any class or series of stock having a preference over the Common
Stock as to dividends or upon liquidation, special meetings of stockholders of
the Corporation may be called only by the Chairman of the Board or the Board of
Directors pursuant to a resolution approved by a majority of the entire Board of
Directors. Special meetings may be held on such date, and at such time and
place within or without the State of Delaware as the Chairman of the Board or
the Board of Directors, whomever has called the meeting, shall direct.

BOARD OF DIRECTORS

15. (a) NUMBER, ELECTION AND TERMS. Except as otherwise fixed by or
pursuant to the provisions of Article IV of the Certificate of Incorporation
relating to the rights of the holders of any class or series of stock having a
preference over the Common Stock as to dividends or upon liquidation to elect
additional Directors under specified circumstances, the number of the Directors
of the Corporation shall be twelve. Directors need not be stockholders. The
Directors, other than those who may be elected by the holders of any class or
series of stock having a preference over the Common Stock as to dividends or
upon liquidation, shall be classified, with respect to the time for which they
severally hold office, into three classes, as nearly equal in number as
possible, as determined by the Board of

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<PAGE>

Directors of the Corporation, one class to be originally elected for a term
expiring at the annual meeting of stockholders to be held in 1986, another class
to be originally elected for a term expiring at the annual meeting of
stockholders to be held in 1987, and another class to be originally elected for
a term expiring at the annual meeting of stockholders to be held in 1988, with
each Director to hold office until his or her successor is duly elected and
qualified. At each annual meeting of the stockholders of the Corporation, the
successors of the class of Directors whose term expires at that meeting shall be
elected to hold office for a term expiring at the annual meeting of stockholders
held in the third year following the year of their election.

(b) NEWLY CREATED DIRECTORSHIPS AND VACANCIES. Except as otherwise
provided for or fixed by or pursuant to the provisions of Article IV of the
Certificate of Incorporation relating to the rights of the holders of any class
or series of stock having a preference over the Common Stock as to dividends or
upon liquidation to elect Directors under specified circumstances, newly
created directorships resulting from any increase in the number of Directors and
any vacancies on the Board of Directors resulting from death, resignation,
disqualification, removal or other cause shall be filled only by the affirmative
vote of a majority of the remaining Directors then in office, even if less than
a quorum of the Board of Directors. Any Director elected in accordance with the
preceding sentence shall hold office for the remainder of the

8
<PAGE>

full term of the class of Directors in which the new directorship was created or
the vacancy occurs and until such Director's successors shall have been elected
and qualified. No decrease in the number of Directors constituting the Board of
Directors shall shorten the term of any incumbent Director.

(c) REMOVAL. Subject to the rights of any class or series of stock having
a preference over the Common Stock as to dividends or upon liquidation to elect
Directors under specified circumstances, any Director may be removed from
office, with or without cause, only by the affirmative vote of the holders of
75% of the combined voting power of the then outstanding shares of stock
entitled to vote generally in the election of Directors, voting together as a
single class.

(d) RESIGNATION. Any Director may resign at any time giving written
notice of such resignation to the Board of Directors, Chairman of the Board, the
President, any Vice President or the Secretary. Any such resignation shall take
effect at the time specified therein or, if no time be specified, upon receipt
thereof by the Board of Directors or one of the above named officers; and,
unless specified therein, the acceptance of such resignation shall not be
necessary to make it effective.

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<PAGE>

MEETINGS OF THE BOARD

16. The first meeting of each newly elected Board shall be held at such
time and place, either within or without the State of Delaware, as shall be
fixed by notice to be given by the Secretary of the Corporation, or at such
place and time as shall be fixed by notice to be given by the Secretary of the
Corporation, or at such place and time as shall be fixed by the consent in
writing of all the Directors.

The Directors may hold their meetings and keep the books of the
Corporation, at such place (within or without the State of Delaware and
California) as they may from time to time determine.

Regular meetings of the Board may be held without notice at such time and
place either within or without the State of Delaware as shall from time to time
be determined by the Board.

Special meetings of the Board may be called by the Chairman of the Board or
the President on one day's notice to each Director, either personally or by mail
or by telegram; special meetings shall be called by the Chairman of the Board or
the President or Secretary in like manner and on like notice on the written
request of two Directors.

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<PAGE>

At all meetings of the Board of Directors when the whole Board consists of
an odd number of Directors, a majority of the whole Board of Directors shall be
necessary and sufficient to constitute a quorum for the transaction of business
and when the whole Board of Directors consists of an even number of Directors,
one-half of the number of Directors shall be necessary and sufficient to
constitute a quorum for the transaction of business. The act of a majority of
the Directors present at any meeting at which there is a quorum shall be the act
of the Board of Directors, except as may be otherwise specifically provided by a
statute or by the Certificate of Incorporation or by these By-Laws.

17. The property and business of the Corporation shall be managed by its
Board of Directors which may exercise all such powers of the Corporation and do
all such lawful acts and things as are not by statute or by the Certificate of
Incorporation or by these By-Laws directed or required to be exercised or done
by the stockholders.

COMMITTEES OF DIRECTORS

18. The Board of Directors may, by resolution or resolutions passed by
the vote of a majority of the whole Board of Directors in favor thereof,
designate one or more committees, each committee to consist of two or more of
the Directors of the Corporation, which, to the extent provided in said
resolution or resolutions, shall

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<PAGE>

have and may exercise the powers of the Board of Directors in the management of
the business and affairs of the Corporation, and may have power to authorize the
seal of the Corporation to be affixed to all papers which may require it. Such
committee or committees shall have such name or names as may be determined from
time to time by resolution adopted by the Board of Directors. Vacancies in the
membership of any committee shall be filled by the Board of Directors at a
regular meeting or at a special meeting called for that purpose.

The committees shall keep regular minutes of their proceedings and report
the same to the Board when required.

COMPENSATION OF DIRECTORS

19. Each Director who is not also an officer of the Corporation shall
receive such stated annual stipend and such allowance for attendance at each
regular or special meeting of the Board or any special or standing committee as
shall be fixed from time to time by resolution of the Board, and the expenses of
attendance at any such meeting by each Director shall be borne by the
Corporation.

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<PAGE>

OFFICERS OF THE CORPORATION

20. The officers of the Corporation shall be a Chairman of the Board, a
Vice Chairman of the Board, a President, one or more Executive Vice Presidents,
one or more Senior Vice Presidents, one or more Vice Presidents, a Secretary, a
Treasurer and such other officers or agents to hold such offices, with such
titles, for such period and have such authority and perform such duties as the
Board of Directors may provide by resolution. The Board of Directors may
delegate to any officer or agent the power to appoint any such subordinate
officers or agents and to prescribe their respective terms of office,
authorities and duties.

21. The salaries of all officers and agents of the Corporation shall be
fixed by the Personnel and Compensation Committee of the Board of Directors.

22. The officers of the Corporation shall hold office until their
successors are chosen and qualified in their stead. Any officer elected or
appointed by the Board of Directors may be removed at any time by the
affirmative vote of a majority of the Directors. If the office of any officer
becomes vacant for any reason, the vacancy shall be filled by the Board of
Directors.

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<PAGE>

POWERS AND DUTIES OF OFFICERS OF THE CORPORATION

23. Subject to any resolution of the Board of Directors which may specify
otherwise, the powers and duties of the various officers of the Corporation
shall be as follows:

The Chairman of the Board of Directors, shall preside at all meetings of
the Board of Directors, the stockholders and the Executive Committee.

In the absence or incapacity of the Chairman of the Board, the President
shall preside at all meetings of the Board of Directors, the stockholders and
the Executive Committee.

The President shall be the chief executive officer of the Corporation.
Subject to the authority of the Board of Directors, the President shall be
responsible for the general management of the business of the Corporation and
shall be responsible for implementing the policies and programs of the Board of
Directors. The President shall have the power to appoint such agents and
employees as in the President's judgment may be necessary or proper for the
transaction of the business of the Corporation, and shall determine their duties
and recommend their compensation. The President shall execute bonds, mortgages
and other contracts requiring a seal, under the seal of the Corporation, except
where required by law to be otherwise signed and executed and except

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<PAGE>

where the signing and execution thereof shall be expressly delegated by the
Board of Directors to some other officer or agent of the Corporation. The
President shall report to the Board of Directors through the Chairman of the
Board.

The Executive Vice Presidents and the Senior Vice Presidents shall perform
such duties as may be delegated or prescribed by the President, the Board of
Directors or the Executive Committee of the Corporation.

The Vice Presidents shall perform such duties and have such powers as are
from time to time prescribed by the Board of Directors or Executive Committee or
as delegated by the President.

The Secretary shall attend all sessions of the Board and all meetings of
the Stockholders and record all votes and the minutes of all proceedings in a
book to be kept for that purpose and shall perform like duties for the standing
committees when required. The Secretary shall give, or cause to be given,
notice of all meetings of the stockholders and special meetings of the Board of
Directors, and shall perform such other duties as may be prescribed by the Board
of Directors, the Chairman of the Board or President, who shall supervise the
Secretary. The Secretary shall keep in safe custody the seal of the Corporation
and, when authorized by the Board, affix the same to any instrument requiring it
and, when so affixed, it shall be attested by the Secretary's signature or by

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<PAGE>

the signature of the Treasurer or the Assistant Corporate Secretary or an
Assistant Secretary.

The Assistant Corporate Secretary, or the Assistant Secretaries in order of
their seniority, shall, in the absence or disability of the Secretary, perform
the duties and exercise the powers of the Secretary and shall perform such other
duties as the Board of Directors shall prescribe.

The Treasurer shall have the custody of the corporate funds and securities
and shall keep full and accurate accounts of receipts and disbursements in books
belonging to the Corporation and shall deposit all monies and other valuable
effects in the name and to the credit of the Corporation in such depositories as
may be designated by the Board of Directors. The Treasurer shall disburse the
funds of the Corporation as may be ordered by the Board, taking proper vouchers
for such disbursements, and shall render to the President and Directors, at
regular meetings of the Board, or whenever they may require an account of all
the Treasurer's transactions as Treasurer and of the financial condition of the
Corporation. If required by the Board of Directors, the Treasurer shall give
the Corporation a bond (which shall be renewed every six years) in such sum and
with such surety or sureties as shall be satisfactory to the Board for the
faithful performance of the duties of this office and for the restoration to the
Corporation, in case of the Treasurer's death, resignation, retirement or

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<PAGE>

removal from office, of all books, papers, vouchers, money and other property of
whatever kind in the Treasurer's possession or under the Treasurer's control
belonging to the Corporation.

The Assistant Treasurers in the order of their seniority shall, in the
absence or disability of the Treasurer, perform the duties and exercise the
powers of the Treasurer and shall perform such other duties as the Board of
Directors shall prescribe.

CERTIFICATE OF STOCK

24. Every holder of stock in a Corporation shall be entitled to have a
certificate signed by, or in the name of the Corporation, by the Chairman of the
Board of Directors or the President, and attested by the Secretary of such
Corporation, certifying the number of shares owned by the holder in such
Corporation. If such certificate is countersigned (1) by a transfer agent other
than the Corporation or its employee, or (2) by a registrar other than the
Corporation or its employee, any other signature on the certificate may be a
facsimile, provided that the transfer agent's signature to such certificate may
be a facsimile signature if the registrar's signature is manual. In case any
officer, transfer agent, or registrar who has signed or whose facsimile
signature has been placed upon a certificate shall have ceased to be such
officer, transfer agent, or registrar before such certificate is issued, it

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<PAGE>

may be issued by the Corporation with the same effect as if he were such
officer, transfer agent, or registrar at the date of issue.

TRANSFERS OF STOCK

25. Upon surrender to the Corporation or the transfer agent of the
Corporation of a certificate for shares duly endorsed or accompanied by proper
evidence of succession, assignment or authority to transfer, it shall be the
duty of the Corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction upon its books.

RECORD DATES

26. In order that the Corporation may determine the stockholders entitled
to notice of or to vote at any meeting of stockholders or any adjournment
thereof, or to express consent to corporate action in writing without a meeting,
or entitled to receive payment of any dividend or other distribution or
allotment of any rights, or entitled to exercise any rights in respect of any
change, conversion or exchange of stock or for the purpose of any other lawful
action, the Board of Directors may fix, in advance, a record date, which shall
be not more than sixty nor less than ten days before the date of such meeting,
nor more than sixty days prior to any other action. Only those stockholders of
record on the date so fixed shall be entitled to any of the foregoing

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<PAGE>

rights, notwithstanding the transfer of any such stock on the books of the
Corporation after any such record date fixed by the Board of Directors.

REGISTERED STOCKHOLDERS

27. The Corporation shall be entitled to treat the holder of record of any
share or shares of stock as the holder in fact thereof and, accordingly, shall
not be bound to recognize any equitable or other claim to or interest in such
share on the part of any other person, whether or not it shall have express or
other notice thereof, except as otherwise provided by the laws of Delaware.

LOST, DESTROYED OR STOLEN CERTIFICATE

28. The Board of Directors may direct a new certificate or certificates to
be issued in place of any certificate or certificates theretofore issued by the
Corporation alleged to have been lost, destroyed or stolen, upon the making of
an affidavit of that fact by the person claiming the certificate of stock to be
lost or stolen. When authorizing such issue of a new certificate or
certificates, the Board of Directors may, in its discretion and as a condition
precedent to the issuance thereof, require the owner of such lost, destroyed or
stolen certificate or certificates, or his legal representative, to advertise
the same in such manner as

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<PAGE>

it shall require and give the Corporation a bond in such sum as it may direct as
indemnity against any claim that may be made against the Corporation with
respect to the certificate alleged to have been lost, destroyed or stolen.

CHECKS

29. All checks or demands for money and notes of the Corporation shall be
signed by such officer or officers or such other person or persons as the Board
of Directors may from time to time designate.

FISCAL YEAR

30. The fiscal year shall begin the first day of January in each year.

DIVIDENDS

31. Dividends upon the capital stock of the Corporation, subject to the
provisions of the Certificate of Incorporation, as amended, may be declared by
the Board of Directors at any regular or special meeting, pursuant to law.
Dividends may be paid in cash, in property, or in shares of the capital stock.

<PAGE>

32. Before payment of any dividend there may be set aside out of any funds
of the Corporation available for dividends such sum or sums as the Directors
from time to time, in their absolute discretion, think proper as a reserve fund
to meeting contingencies, or for equalizing dividends, or for repairing or
maintaining any property of the Corporation, or for such other purpose as the
Directors shall think conducive to the interest of the Corporation, and the
Directors may abolish any such reserve in the manner in which it was created.

DIRECTORS' ANNUAL STATEMENT

33. The Board of Directors shall present at each annual meeting and when
called for by vote of the stockholders at any special meeting of the
stockholders, a full and clear statement of the business and condition of the
Corporation.

LIMITATION OF LIABILITY

34. A Director of the Corporation shall not be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the Director's
duty of loyalty to the Corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involved intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the Delaware General

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<PAGE>

Corporation Law, or (iv) for any transaction from which the director derived an
improper personal benefit.

INDEMNIFICATION

35. (a) ACTION, ETC. OTHER THAN BY OR IN THE RIGHT OF THE CORPORATION.
The Corporation shall indemnify and hold harmless, to the fullest extent
permitted by applicable law as it presently exists or may hereafter be amended,
Agent (as hereinafter defined) against costs, charges and expenses (as
hereinafter defined) (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by an Agent in connection
with such action, suit or proceeding, and any appeal therefrom, if Agent acted
in good faith and in a manner Agent reasonably believed to be in or not opposed
to the best interests of the Corporation, and with respect to any criminal
action or proceeding, had no reasonable cause to believe such conduct was
unlawful. The termination of any action, suit or proceeding -- whether by
judgment, order, settlement, conviction, or upon a plea of NOLO CONTENDERE or
its equivalent -- shall not, of itself, create a presumption that the Agent did
not act in good faith and in a manner which the Agent reasonably believed to be
in or not opposed to the best interests of the Corporation, and, with respect to
any criminal action or proceeding, that such person had reasonable cause to
believe that the Agent's conduct was unlawful.

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<PAGE>

(b) ACTION ETC., BY OR IN THE RIGHT OF THE CORPORATION. The Corporation
shall indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed judicial action or suit brought by
or in the right of the Corporation to procure a judgment in its favor by reason
of the fact that such person is or was an Agent against costs, charges and
expenses (including attorneys' fees) actually and reasonably incurred by an
Agent in connection with the defense or settlement of such action or suit and
any appeal therefrom if the Agent acted in good faith and in a manner such
person reasonably believed to be in or not opposed to the best interests of the
Corporation, except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable for gross negligence or willful misconduct in the performance of the
Agent's duty to the Corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such costs, charges and expenses which the Court of Chancery or
other such court shall deem proper.

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<PAGE>

Directors by a majority vote of a quorum consisting of Directors who were not
parties to such action, suit or proceeding, or (ii) if such a quorum is not
obtainable, or, even if obtainable, if a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion, or (iii) by the
stockholders, that such person acted in bad faith and in a manner that such
person did not believe to be in or not opposed to the best interests of the
Corporation, or, with respect to any criminal proceeding, that such person
believed or had reasonable cause to believe that his conduct was unlawful.

(e) ADVANCES OF EXPENSES. Except as limited by Paragraph (f) of this
Section, costs, charges and expenses (including attorneys' fees) incurred by an
Agent in any action, suit, proceeding or investigation or any appeal therefrom
shall be paid by the Corporation in advance of the final disposition of such
matter, if

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<PAGE>

the Agent shall undertake to repay such amount in the event that it is
ultimately determined, as provided herein, that such person is not entitled to
indemnification. Notwithstanding the foregoing, no advance shall be made by the
Corporation if a determination is reasonably and promptly made by the Board of
Directors by a majority vote of a quorum of disinterested directors, or (if such
a quorum is not obtainable or, even if obtainable, a quorum of disinterested
directors so directs) by independent legal counsel in a written opinion, that,
based upon the facts known to the Board of Directors or counsel at the time
such determination is made, the Agent acted in bad faith and in a manner that
such person did not believe to be in or not opposed to the best interest of the
Corporation, or, with respect to any criminal proceeding, that such person
believed or had reasonable cause to believe his conduct was unlawful. In no
event shall any advance be made in instances where the Board of Directors or
independent legal counsel reasonably determines that the Agent deliberately
breached such person's duty to the Corporation or its shareholders.

(f) RIGHT OF AGENT TO INDEMNIFICATION UPON APPLICATION; PROCEDURE UPON
APPLICATION. Any indemnification under Paragraphs (a), (b) and (d) or advance
under Paragraph (e) of this Section, shall be made promptly, and in any event
within sixty days, upon the written request of the Agent, unless with respect
to applications under Paragraphs (a), (b) or (e), a determination is reasonably
and promptly made by the Board of Directors by a

25
<PAGE>

majority vote of a quorum of disinterested Directors that such Agent acted in a
manner set forth in such Paragraphs as to justify the Corporation's not
indemnifying or making an advance to the Agent. In the event no quorum of
disinterested Directors is obtainable, the Board of Directors shall promptly
direct that independent legal counsel shall decide whether the Agent acted in
the manner set forth in such Paragraphs as to justify the Corporation's not
indemnifying or making an advance to the Agent. The right to indemnification or
advances as granted by this Section shall be enforceable by the Agent in any
court of competent jurisdiction, if the Board of Directors or independent legal
counsel denies the claim in whole or in part, or if no disposition of such claim
is made within sixty days. The Agent's costs, charges and expenses incurred in
connection with successfully establishing such person's right to
indemnification, in whole or in part, in any such proceeding shall also be
indemnified by the Corporation.

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<PAGE>

shall inure to the benefit of the heirs, executors and administrators of such a
person. All rights to indemnification under this Section shall be deemed to be
a contract between the Corporation and the Agent who serves in such capacity at
any time while these By-Laws and other relevant provisions of the general
corporation law and other applicable law, if any, are in effect. Any repeal or
modification thereof shall not affect any rights or obligations then existing.

(h) INSURANCE. The Corporation may purchase and maintain insurance on
behalf of any person who is or was an Agent against any liability asserted
against such person and incurred by him or her in any such capacity, or arising
out of such person's status as such, whether or not the Corporation would have
the power to indemnify such person against such liability under the provisions
of this Section. The Corporation may create a trust fund, grant a security
interest or use other means (including, without limitation, a letter of credit)
to ensure the payment of such sums as may become necessary to effect
indemnification as provided herein.

(i) PRESUMPTIONS AND EFFECT OF CERTAIN PROCEEDINGS.

(1) If a Change of Control (as hereinafter defined) shall have
occurred, in making a determination with respect to entitlement to
indemnification hereunder, the person, persons or

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<PAGE>

entity making such determination shall presume that the Agent is entitled to
indemnification under this Section if the Agent has submitted a request for
indemnification in accordance with Paragraph (f) of this Section, and the
Corporation shall have the burden of proof to overcome that presumption in
connection with the making by any person, persons or entity of any determination
contrary to that presumption.

(2) If the person, persons or entity empowered or selected under
Paragraph (f) of this Section to determine whether the Agent is entitled to
indemnification shall not have made such determination within sixty days after
receipt by the Corporation of the request therefor, the requisite determination
of entitlement to indemnification shall be deemed to have been made and Agent
shall be entitled to such indemnification, absent (i) a misstatement by the
Agent of a material fact, or an omission of a material fact necessary to make
the Agent's statement not materially misleading, in connection with the request
for indemnification, or (ii) a prohibition of such indemnification under
applicable law; PROVIDED, HOWEVER, that such sixty-day period may be extended
for a reasonable time, not to exceed an additional thirty days, if the person,
persons or entity making the determination with respect to entitlement to
indemnification in good faith requires such additional time for the obtaining
or evaluating of documentation and/or information relating thereto; and
PROVIDED, FURTHER, that the foregoing provisions of this Paragraph (i) shall
not apply (a)

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<PAGE>

if the determination of entitlement to indemnification is to be made by the
stockholders pursuant to Paragraph (f) of this Section and if (A) within
fifteen days after receipt by the Corporation of the request for such
determination the Board of Directors has resolved to submit such determination
to the stockholders for their consideration at an annual meeting thereof to be
held within seventy five days after such receipt and such determination is made
thereat, or (B) a special meeting of stockholders is called within fifteen days
after such receipt for the purpose of making such determination, such meeting
is held for such purpose within sixty days after having been so called and such
determination is made thereat, or (b) if the determination of entitlement to
indemnification is to be made by independent counsel pursuant to Paragraph (f)
of this Section.

(3) The termination of any proceeding or of any claim, issue or matter
therein by judgment, order, settlement or conviction, or upon a plea of NOLO
CONTENDERE or its equivalent, shall not (except as otherwise expressly provided
in this Section) of itself adversely affect the right of the Agent to
indemnification or create a presumption that the Agent did not act in good faith
and in a manner which such person reasonably believed to be in or not opposed to
the best interests of the Corporation, or, with respect to any criminal
proceeding, that the Agent had reasonable cause to believe that such person's
conduct was unlawful.

29
<PAGE>

(j) OTHER ENTERPRISES, FINES, AND AT CORPORATION'S REQUEST. For purposes
of this Section, references to "other enterprise" in Paragraph (a) shall include
employee benefit plans; references to "fines" shall include any excise taxes
assessed on a person with respect to any employee benefit plan; and references
to "serving at the request of the Corporation" shall include any service by
Agent as director, officer, employee, agent or fiduciary of the corporation
which imposes duties on, or involves services by, such Agent with respect to any
employee benefit plan, its participants, or beneficiaries; and a person who
acted in good faith and in a manner such person reasonably believed to be in the
interest of the participants and beneficiaries of an employee benefit plan shall
be deemed to have acted in a manner "not opposed to the best interests of the
Corporation" as referred to in this Section.

(k) SAVINGS CLAUSE. If this Section or any portion thereof shall be
invalidated on any ground by any court of competent jurisdiction, then the
Corporation shall nevertheless indemnify each Agent as to costs, charges and
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement with respect to any action, suit, proceeding or investigation, and
any appeal therefrom, whether civil, criminal or administrative, and whether
internal or external, including a grand jury proceeding and an action or suit
brought by or in the right of the Corporation, to the full extent permitted by
any applicable portion of this Section

30
<PAGE>

that shall not have been invalidated, and to the fullest extent permitted by
applicable law.

(l) DEFINITIONS. For the purposes of this Article:

(1) "Agent" means any person who was or is a party or is threatened
to be made a party to any threatened, pending or completed action, suit or
proceeding or investigation, whether civil, criminal or administrative, and
whether external or internal to the Corporation (other than a judicial action
or suit brought by or in the right of the Corporation) by reason of the fact
that he or she is or was or has agreed to be a director, officer, employee,
agent or fiduciary of the Corporation, or that, being or having been such a
director, officer, employee, agent or fiduciary, he or she is or was serving at
the request of the Corporation as a director, officer, employee, agent or
fiduciary of another corporation, partnership, joint venture, trust or other
enterprise.

(2) "Expenses" shall include all reasonable attorneys' fees, retainers,
court costs, transcript costs, fees of experts, witness fees, travel expenses,
duplicating costs, printing and binding costs, telephone charges, postage,
delivery service fees, and all other disbursements or expenses of the types
customarily incurred in connection with prosecuting, defending, preparing to
prosecute

31
<PAGE>

or defend, investigating, or being or preparing to be a witness in a proceeding.

(3) "Change in Control" means a change in control of the Corporation of a
nature that would be required to be reported in response to Item 5(f) of
Schedule 14A of Regulation 14A (or in response to any similar item on any
similar schedule or form) promulgated under the Securities Exchange Act of 1934
(the "Act"), whether or not the Corporation is then subject to such reporting
requirement; provided, however, that, without limitation, such a Change in
Control shall be deemed to have occurred if (i) any "person" (as such term is
used in Sections 13(d) and 14(d) of the Act) is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Act), directly or indirectly, of
securities of the Corporation representing 25% or more of the combined voting
power of the Corporation's then outstanding securities without the prior
approval of at least two-thirds of the members of the Board of Directors in
office immediately prior to such person attaining such percentage interest;
(ii) the Corporation is a party to a merger, consolidation, sale of assets or
other reorganization, or a proxy contest, as a consequence of which members of
the Board of Directors in office immediately prior to such transaction or event
constitute less than a majority of the Board of Directors thereafter; or (iii)
during any period of three consecutive years, individuals who at the beginning
of such period constituted the Board of Directors (including for this purpose
any new director

32
<PAGE>

whose election or nomination for election by the Corporation's stockholders was
approved by a vote of at least two-thirds of the Directors then still in office
who were Directors at the beginning of such period) cease for any reason to
constitute at least a majority of the Board of Directors.

INTERESTED DIRECTORS; QUORUM

36. Except as set forth in Article IX of the Certificate of Incorporation,
no contract or transaction between the Corporation and one or more of its
Directors or officers or between the Corporation and any other corporation,
partnership, association, or other organization in which one or more of its
directors or officers are directors or officers, or have a financial interest,
shall be void or voidable solely for this reason, or solely because the
director or officer is present at or participates in the meeting of the Board or
committee thereof which authorized the contract or transaction, or solely
because his or their votes are counted for such purpose, if:

(a) The material facts as to his interest and as to the contract or
transaction are disclosed or are known to the Board of Directors or the
Committee, and the Board or committee in good faith authorizes the contract or
transaction by a vote sufficient for such purpose without counting the vote of
the interested Director or Directors; or

33
<PAGE>

(b) The material facts as to his interest and as to the contract or
transaction are disclosed or are known to the stockholders entitled to vote
thereon, and the contract or transaction is specifically approved in good faith
by vote of the stockholders; or

(c) The contract or transaction is fair as to the Corporation as of the
time it is authorized, approved or ratified, by the Board of Directors or a
committee thereof, or the stockholders.

Interested Directors may be counted in determining the presence of a quorum
at a meeting of the Board of Directors or of a committee which authorizes the
contract or transaction.

NOTICES

37. Whenever under the provisions of these By-Laws notice is required to
be given to any Director or stockholder, it shall not be construed to mean
personal notice, but such notice may be given in writing, by mail, by depositing
the same in the post office or letter box, in a postpaid sealed wrapper,
addressed to such Director or stockholder at such address as appears on the
books of the Corporation, or, in default of other address, to such director or
stockholder at the General Post Office in the City of

34
<PAGE>

Wilmington, Delaware, and such notice shall be deemed to be given at the time
when the same shall be thus mailed.

38. Whenever any notice is required to be given by a statute or the
Certificate of Incorporation or the By-Laws of this Corporation, waiver there in
writing signed by the person or persons entitled to such notice, whether signed
before or after the time therein stated shall be deemed the equivalent to the
giving of such notice, except that any alteration or repeal of these By-Laws or
election of a Director to fill a vacancy or newly created directorship shall
require actual notice given in accordance with these By-Laws.

BY-LAW AMENDMENTS

39. Subject to the provisions of the Certificate of Incorporation, these
By-Laws may be altered, amended or repealed at any regular meeting of the
stockholders (or at any special meeting thereof duly called for that purpose) by
a majority vote of the shares represented and entitled to vote at such meeting;
provided that in the notice of such special meeting notice of such purpose
shall be given. Subject to the laws of the State of Delaware, the Certificate
of Incorporation and these By-Laws, the Board of Directors may, by majority vote
of those present at any meeting at which a quorum is present, amend these
By-Laws, or enact such other

35
<PAGE>

By-Laws as in their judgment may be advisable for the regulation of the conduct
of the affairs of the Corporation.

COMPLIANCE WITH THE NEW JERSEY CASINO CONTROL
ACT ("CASINO ACT") IF A SUBSIDIARY OF THE
CORPORATION BECOMES A CASINO LICENSEE PURSUANT TO
THE CASINO ACT.

40. If the Corporation becomes, and so long as it remains, either a
holding company or intermediary company as to the holder of a casino licensee
pursuant to the New Jersey Casino Control Act, P.L. 1977, c. 110 (N.J.S. 5:12-1
et seq., "Casino Act"), all securities of the Corporation are held subject to
the applicable provisions of the Casino Act. If a holder thereof is found to
be disqualified by the New Jersey Casino Control Commission pursuant to the
Casino Act, then such holder shall dispose of his interest in the Corporation.

NOMINATIONS OF DIRECTOR CANDIDATES

41. (a) ELIGIBILITY TO MAKE NOMINATIONS.
Nominations of candidates for election as Directors of the Corporation at any
meeting of stockholders calling for election of Directors, in whole or in part
(an "Election Meeting"), may be made by the Board of Directors or by any
stockholder entitled to vote at such Election Meeting.

36
<PAGE>

(b) PROCEDURE FOR NOMINATIONS BY THE BOARD OF DIRECTORS. Nominations
made by the Board shall be made at a meeting of the Board, or by written consent
of Directors in lieu of a meeting, not less than 30 days prior to the date of
the Election Meeting. At the request of the Secretary of the Corporation each
proposed nominee shall provide the Corporation with such information concerning
such nominee as is required, under the rules of the Securities and Exchange
Commission ("SEC"), to be included in the Corporation's proxy statement
soliciting proxies for his election as a director.

(c) PROCEDURE FOR NOMINATIONS BY STOCKHOLDERS. Not less than 60 days
prior to the date of the Election Meeting any stockholder who intends to make a
nomination at the Election Meeting shall deliver a notice to the Secretary of
the Corporation setting forth (i) the name, age, business address and residence
address of each nominee proposed in such notice, (ii) the principal occupation
or employment of each such nominee, (iii) the number of shares of capital stock
of the Corporation which are beneficially owned by each such nominee, and (iv)
such other information concerning each such nominee as would be required, under
the rules of the SEC, in a proxy statement soliciting proxies for the election
of such nominees. Such notice shall include a signed consent to serve as a
director of the Corporation, if elected, of each such nominee.

37
<PAGE>

(d) SUBSTITUTION OF NOMINEES. In the event that a person is validly
designated as a nominee in accordance with paragraph (b) or paragraph (c) hereof
and shall thereafter become unable or unwilling to stand for election to the
Board, the Board or the stockholder who proposed such nominee, as the case may
be, may designate a substitute nominee.

(e) DETERMINATION OF COMPLIANCE WITH PROCEDURES. If the Chairman of the
Election Meeting determines that a nomination was not made in accordance with
the foregoing procedures, such nomination shall be void.

CONSENTS TO CORPORATE ACTION

42. In the event of the delivery to the Company of a written consent or
consents to corporate action purporting to be signed by or on behalf of holders
of outstanding stock of the Company having not less than the number of votes
that would be necessary to authorize or take the action specified therein,
and/or related revocations, the Secretary or the Assistant Corporate Secretary
or an Assistant Secretary shall provide for the safekeeping of the consent or
consents and/or of revocations and shall conduct such reasonable investigation
as he deems necessary or appropriate for the purpose of ascertaining whether the
requisite vote has been obtained, and all matters incident thereto, including
the validity of such consent or consents and/or revocations; PROVIDED, HOWEVER,

38
<PAGE>

that if the corporate action to which the consent or consents relate is the
removal of one or more members of the Board, the Secretary or the Assistant
Corporate Secretary or an Assistant Secretary shall designate two persons, who
may or may not be stockholders but who shall not be members of the Board, to
serve as Inspectors and such Inspectors shall discharge the functions of the
Secretary hereunder. If after such investigation the Secretary or the Assistant
Corporate Secretary or an Assistant Secretary or the Inspectors, as the case may
be, shall determine that the requisite vote has been obtained, that fact shall
be certified on the records of the Company kept for the purpose of recording the
proceedings of meetings of stockholders, and the consent or consents and/or
revocations shall be filed in such records, at which time said consent or
consents shall become effective as stockholder action; PROVIDED, HOWEVER, that
neither the Secretary, the Assistant Corporate Secretary, an Assistant Secretary
nor the Inspectors, as the case may be, shall make such certification or filing,
and the consent or consents shall not become effective as stockholder action,
until the final termination of any proceedings which may have been commenced in
the Court of Chancery of the State of Delaware or any other court of competent
jurisdiction for an adjudication of any legal issues incident to determining
whether the requisite vote has been obtained, unless such Court shall determine
that such proceedings are not being pursued expeditiously and in good faith.

39
<PAGE>

In conducting the investigation directed hereby, the Secretary or the
Assistant Corporate Secretary or an Assistant Secretary or the Inspectors, as
the case may be, may at the expense of the Company retain special legal counsel
or other necessary and proper professional advisors, and such other personnel as
may be necessary or appropriate, to assist them.

<PAGE>

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

INDENTURE

between

HILTON HOTELS CORPORATION

and

_________________________,
as Trustee

Dated as of ______________, 199_

----------

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

<PAGE>

TABLE OF CONTENTS

Page
----

ARTICLE ONE-DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Section 1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.02. Compliance Certificates and Opinions. . . . . . . . . . 11
Section 1.03. Form of Documents Delivered to Trustee. . . . . . . . . 11
Section 1.04. Notices, etc., to Trustee and Company . . . . . . . . . 12
Section 1.05. Notice to Holders; Waiver . . . . . . . . . . . . . . . 12
Section 1.06. Conflict with Trust Indenture Act . . . . . . . . . . . 13
Section 1.07. Counterparts; Effect of Headings and Table of Contents. 13
Section 1.08. Successors and Assigns. . . . . . . . . . . . . . . . . 13
Section 1.09. Separability Clause . . . . . . . . . . . . . . . . . . 13
Section 1.10. Benefits of Indenture . . . . . . . . . . . . . . . . . 13
Section 1.11. Governing Law . . . . . . . . . . . . . . . . . . . . . 14
Section 1.12. Legal Holidays. . . . . . . . . . . . . . . . . . . . . 14
Section 1.13. No Recourse Against Others. . . . . . . . . . . . . . . 14

ARTICLE TWO- DEBT SECURITY FORMS . . . . . . . . . . . . . . . . . . 14

Section 2.01. Forms Generally . . . . . . . . . . . . . . . . . . . . 14
Section 2.02. Form of Trustee's Certificate of Authentication . . . . 15
Section 2.03. Securities in Global Form . . . . . . . . . . . . . . . 15

ARTICLE THREE- THE DEBT SECURITIES . . . . . . . . . . . . . . . . . . 16

Section 3.01. Amount Unlimited; Issuable in Series. . . . . . . . . . 16
Section 3.02. Denominations . . . . . . . . . . . . . . . . . . . . . 20
Section 3.03. Execution, Authentication, Delivery and Dating. . . . . 20
Section 3.04. Temporary Debt Securities; Exchange of Temporary
Global Notes for Definitive Bearer Securities;
Global Notes Representing Registered Securities . . . . 22
Section 3.05. Registration, Transfer and Exchange . . . . . . . . . . 26
Section 3.06. Mutilated, Destroyed, Lost and Stolen Debt Securities . 28
Section 3.07. Payment of Interest; Interest Rights Preserved. . . . . 29
Section 3.08. Cancellation. . . . . . . . . . . . . . . . . . . . . . 31
Section 3.09. Computation of Interest . . . . . . . . . . . . . . . . 31
Section 3.10. Currency of Payments in Respect of Debt Securities. . . 31
Section 3.11. Judgments . . . . . . . . . . . . . . . . . . . . . . . 34
Section 3.12. Exchange Upon Default . . . . . . . . . . . . . . . . . 35
Section 3.13. Mandatory Disposition of Debt Securities Pursuant to
Gaming Laws . . . . . . . . . . . . . . . . . . . . . . 35

ARTICLE FOUR- SATISFACTION AND DISCHARGE. . . . . . . . . . . . . . . 35

Section 4.01. Satisfaction and Discharge of Indenture . . . . . . . . 35
Section 4.02. Application of Trust Money. . . . . . . . . . . . . . . 37

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ARTICLE FIVE- REMEDIES. . . . . . . . . . . . . . . . . . . . . . . . 37

Section 5.01. Events of Default . . . . . . . . . . . . . . . . . . . 37
Section 5.02. Acceleration of Maturity; Rescission and Annulment. . . 38
Section 5.03. Collection of Indebtedness and Suits for Enforcement
by Trustee. . . . . . . . . . . . . . . . . . . . . . . 39
Section 5.04. Trustee May File Proofs of Claim. . . . . . . . . . . . 40
Section 5.05. Trustee May Enforce Claims Without Possession of Debt
Securities. . . . . . . . . . . . . . . . . . . . . . . 40
Section 5.06. Application of Money Collected. . . . . . . . . . . . . 41
Section 5.07. Limitation on Suits . . . . . . . . . . . . . . . . . . 41
Section 5.08. Unconditional Right of Holders to Receive Principal,
Premium and Interest. . . . . . . . . . . . . . . . . . 42
Section 5.09. Restoration of Rights and Remedies. . . . . . . . . . . 42
Section 5.10. Rights and Remedies Cumulative. . . . . . . . . . . . . 42
Section 5.11. Delay or Omission Not Waiver. . . . . . . . . . . . . . 42
Section 5.12. Control by Holders. . . . . . . . . . . . . . . . . . . 42
Section 5.13. Waiver of Past Defaults . . . . . . . . . . . . . . . . 43
Section 5.14. Undertaking for Costs . . . . . . . . . . . . . . . . . 43
Section 5.15. Waiver of Stay or Extension Laws. . . . . . . . . . . . 43

ARTICLE SIX- THE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . 44

Section 6.01. Certain Duties and Responsibilities . . . . . . . . . . 44
Section 6.02. Notice of Defaults. . . . . . . . . . . . . . . . . . . 45
Section 6.03. Certain Rights of Trustee . . . . . . . . . . . . . . . 45
Section 6.04. Not Responsible for Recitals or Issuance of Debt
Securities. . . . . . . . . . . . . . . . . . . . . . . 46
Section 6.05. May Hold Debt Securities. . . . . . . . . . . . . . . . 46
Section 6.06. Money Held in Trust . . . . . . . . . . . . . . . . . . 47
Section 6.07. Compensation and Reimbursement. . . . . . . . . . . . . 47
Section 6.08. Disqualification; Conflicting Interests . . . . . . . . 47
Section 6.09. Corporate Trustee Required; Eligibility . . . . . . . . 52
Section 6.10. Resignation and Removal; Appointment of Successor . . . 53
Section 6.11. Acceptance of Appointment by Successor. . . . . . . . . 54
Section 6.12. Merger, Conversion, Consolidation or Succession to
Business. . . . . . . . . . . . . . . . . . . . . . . . 55
Section 6.13. Preferential Collection of Claims Against Company . . . 55
Section 6.14. Appointment of Authenticating Agent . . . . . . . . . . 58

ARTICLE SEVEN- HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY . . . 60

Section 7.01. Company to Furnish Trustee Names and Addresses of
Holders . . . . . . . . . . . . . . . . . . . . . . . . 60
Section 7.02. Preservation of Information; Communication to Holders . 60
Section 7.03. Reports by Trustee. . . . . . . . . . . . . . . . . . . 61
Section 7.04. Reports by Company. . . . . . . . . . . . . . . . . . . 63

ARTICLE EIGHT- CONCERNING THE HOLDERS. . . . . . . . . . . . . . . . . 63

Section 8.01. Acts of Holders . . . . . . . . . . . . . . . . . . . . 63

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<PAGE>

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----

Section 8.02. Proof of Ownership; Proof of Execution of Instruments
by Holder . . . . . . . . . . . . . . . . . . . . . . . 63
Section 8.03. Persons Deemed Owners . . . . . . . . . . . . . . . . . 64
Section 8.04. Revocation of Consents; Future Holders Bound. . . . . . 64

ARTICLE NINE- HOLDERS' MEETINGS . . . . . . . . . . . . . . . . . . . 65

Section 9.01. Purposes of Meetings. . . . . . . . . . . . . . . . . . 65
Section 9.02. Call of Meetings by Trustee . . . . . . . . . . . . . . 65
Section 9.03. Call of Meetings by Company or Holders. . . . . . . . . 66
Section 9.04. Qualifications for Voting . . . . . . . . . . . . . . . 66
Section 9.05. Regulations . . . . . . . . . . . . . . . . . . . . . . 66
Section 9.06. Voting. . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 9.07. No Delay of Rights by Meeting . . . . . . . . . . . . . 67

ARTICLE TEN- CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE. . 67

Section 10.01. Company May Consolidate, etc., Only on Certain Terms. . 67
Section 10.02. Successor Corporation Substituted . . . . . . . . . . . 68

ARTICLE ELEVEN- SUPPLEMENTAL INDENTURES . . . . . . . . . . . . . . . . 68

Section 11.01. Supplemental Indentures Without Consent of Holders. . . 68
Section 11.02. Supplemental Indentures With Consent of Holders . . . . 69
Section 11.03. Execution of Supplemental Indentures. . . . . . . . . . 70
Section 11.04. Effect of Supplemental Indentures . . . . . . . . . . . 70
Section 11.05. Conformity with Trust Indenture Act . . . . . . . . . . 70
Section 11.06. Reference in Debt Securities to Supplemental
Indentures. . . . . . . . . . . . . . . . . . . . . . . 71

ARTICLE TWELVE- COVENANTS . . . . . . . . . . . . . . . . . . . . . . . 71

Section 12.01. Payment of Principal, Premium and Interest. . . . . . . 71
Section 12.02. Officer's Certificate as to Compliance. . . . . . . . . 71
Section 12.03. Maintenance of Office or Agency . . . . . . . . . . . . 71
Section 12.04. Money for Debt Securities; Payments To Be Held in
Trust . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 12.05. Corporate Existence . . . . . . . . . . . . . . . . . . 74
Section 12.06. Waiver of Certain Covenants . . . . . . . . . . . . . . 74

ARTICLE THIRTEEN- REDEMPTION OF DEBT SECURITIES . . . . . . . . . . . . . 74

Section 13.01. Applicability of Article. . . . . . . . . . . . . . . . 74
Section 13.02. Election to Redeem; Notice to Trustee . . . . . . . . . 74
Section 13.03. Selection by Trustee of Debt Securities to Be
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . 75
Section 13.04. Notice of Redemption. . . . . . . . . . . . . . . . . . 75
Section 13.05. Deposit of Redemption Price . . . . . . . . . . . . . . 76
Section 13.06. Debt Securities Payable on Redemption Date. . . . . . . 76
Section 13.07. Debt Securities Redeemed in Part. . . . . . . . . . . . 77

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<PAGE>

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----

ARTICLE FOURTEEN- SINKING FUNDS . . . . . . . . . . . . . . . . . . . . . 77

Section 14.01. Applicability of Article. . . . . . . . . . . . . . . . 77
Section 14.02. Satisfaction of Mandatory Sinking Fund Payments with
Debt Securities . . . . . . . . . . . . . . . . . . . . 78
Section 14.03. Redemption of Debt Securities for Sinking Fund. . . . . 78

ARTICLE FIFTEEN- DEFEASANCE. . . . . . . . . . . . . . . . . . . . . . . 79

Section 15.01. Applicability of Article. . . . . . . . . . . . . . . . 79
Section 15.02. Defeasance Upon Deposit of Moneys or U.S. Government
Obligations . . . . . . . . . . . . . . . . . . . . . . 80
Section 15.03. Deposited Moneys and U.S. Government Obligations to
Be Held in Trust. . . . . . . . . . . . . . . . . . . . 81
Section 15.04. Repayment to Company. . . . . . . . . . . . . . . . . . 81

ARTICLE SIXTEEN- CONVERSION. . . . . . . . . . . . . . . . . . . . . . . 82

Section 16.01. Applicability; Conversion Privilege . . . . . . . . . . 82
Section 16.02. Conversion Procedure; Conversion Price; Fractional
Shares. . . . . . . . . . . . . . . . . . . . . . . . . 82
Section 16.03. Adjustment of Conversion Price for Common Stock . . . . 83
Section 16.04. Consolidation or Merger of the Company. . . . . . . . . 86
Section 16.05. Notice of Adjustment. . . . . . . . . . . . . . . . . . 86
Section 16.06. Notice in Certain Events. . . . . . . . . . . . . . . . 86
Section 16.07. Company to Reserve Stock; Registration; Listing . . . . 87
Section 16.08. Taxes on Conversion . . . . . . . . . . . . . . . . . . 88
Section 16.09. Conversion After Record Date. . . . . . . . . . . . . . 88
Section 16.10. Company Determination Final . . . . . . . . . . . . . . 88
Section 16.11. Trustee's Disclaimer. . . . . . . . . . . . . . . . . . 88

Exhibit A -- Form of Redeemable or Nonredeemable Debt Security

Exhibit B -- Form of Coupon

Exhibit C -- Form of Certificate to be Given by Person Entitled to
Receive Bearer Security or Interest Prior to an Exchange
Date

Exhibit D -- Form of Certificate to be Given by Euro-Clear and Cedel,
S.A.

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<PAGE>

Reconciliation and tie between Trust Indenture Act of 1939
and Indenture, dated as of _________ __, 199_

Trust Indenture Act Section Indenture Section
- --------------------------- -----------------

Section 310 (a)(1) . . . . . . . . . . . . . . . 6.09
(a)(2) . . . . . . . . . . . . . . . 6.09
(a)(3) . . . . . . . . . . . . . . . Not Applicable
(a)(4) . . . . . . . . . . . . . . . Not Applicable
(a)(5) . . . . . . . . . . . . . . . 6.09
(b). . . . . . . . . . . . . . . . . 6.08, 6.10
(c). . . . . . . . . . . . . . . . . Not Applicable
Section 311 (a). . . . . . . . . . . . . . . . . 6.13(a)
(b). . . . . . . . . . . . . . . . . 6.13(b)
(c). . . . . . . . . . . . . . . . . Not Applicable
Section 312 (a). . . . . . . . . . . . . . . . . 7.01, 7.02(a)
(b). . . . . . . . . . . . . . . . . 7.02(b)
(c). . . . . . . . . . . . . . . . . 7.02(c)
Section 313 (a). . . . . . . . . . . . . . . . . 7.03(a)
(b). . . . . . . . . . . . . . . . . 7.03(b)
(c). . . . . . . . . . . . . . . . . 7.03(a),
7.03(c)
(d). . . . . . . . . . . . . . . . . 7.03(d)
Section 314 (a). . . . . . . . . . . . . . . . . 7.04, 12.02
(b). . . . . . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . . . . 1.02
(c)(2) . . . . . . . . . . . . . . . 1.02
(c)(3) . . . . . . . . . . . . . . . Not Applicable
(d). . . . . . . . . . . . . . . . . Not Applicable
(e). . . . . . . . . . . . . . . . . 1.02
Section 315 (a). . . . . . . . . . . . . . . . . 6.01(a),
6.01(c)
(b). . . . . . . . . . . . . . . . . 6.02,
7.03(a)(7)
(c). . . . . . . . . . . . . . . . . 6.01(b)
(d)(1) . . . . . . . . . . . . . . . 6.01(a)
(d)(2) . . . . . . . . . . . . . . . 6.01(c)(2)
(d)(3) . . . . . . . . . . . . . . . 6.01(c)(3)
(e). . . . . . . . . . . . . . . . . 5.14
Section 316 (a)(1)(A). . . . . . . . . . . . . . 5.02, 5.12
(a)(1)(B). . . . . . . . . . . . . . 5.13
(a)(2) . . . . . . . . . . . . . . . Not Applicable
(b). . . . . . . . . . . . . . . . . 5.08
(c). . . . . . . . . . . . . . . . . Not Applicable

-v-

<PAGE>

Section 317 (a)(1) . . . . . . . . . . . . . . . 5.03
(a)(2) . . . . . . . . . . . . . . . 5.04
(b). . . . . . . . . . . . . . . . . 12.04
Section 318 . . . . . . . . . . . . . . . . . . 1.06

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

Attention should also be directed to Section 318(c) of the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), which provides
that the provisions of Sections 310 to and including 317 of the Trust Indenture
Act are a part of and govern every qualified indenture, whether or not
physically contained therein.

-vi-

<PAGE>

INDENTURE dated as of _______ __, 199_, by and between HILTON HOTELS
CORPORATION, a Delaware corporation (the "Company"), having its principal
executive office at 9336 Civic Center Drive, Beverly Hills, California 90210 and
__________________________ (the "Trustee"), having its Corporate Trust Office at
_______________________________.

RECITALS OF THE COMPANY

The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its debentures,
notes, bonds or other evidences of indebtedness (the "Debt Securities"), to be
issued in one or more series, as provided in this Indenture.

This Indenture is subject to the provisions of the Trust Indenture
Act of 1939, as amended, that are deemed incorporated into this Indenture and
shall, to the extent applicable, be governed by such provisions.

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

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

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

ARTICLE ONE

DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION

Section 1.01. DEFINITIONS.

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

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

(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;

(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles or as provided with respect to any series of Debt Securities,
and, except as otherwise herein provided or as provided with respect to any
series of Debt Securities, the term "generally accepted accounting
principles" or "GAAP" with respect to any computation required or permitted
hereunder with respect to any series of Debt Securities, shall mean such as
set forth in the opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board
or in such other

<PAGE>

statements by such other entity as have been approved by a significant
segment of the accounting profession which are in effect as of the date of
determination; and

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

(5) certain terms, used principally in Article Three or Article Six,
are defined in those respective Articles.

"Act" when used with respect to any Holder, has the meaning
specified in Section 8.01.

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

"Authenticating Agent" has the meaning specified in Section 6.14.

"Authorized Newspaper" means a newspaper in an official language
of the country of publication customarily published at least once a
day, and customarily published for at least five days in each calendar
week, and of general circulation in the place in connection with which
the term is used or in the financial community of such place. Where
successive publications are required to be made in Authorized
Newspapers, the successive publications may be made in the same or in
different newspapers in the same city meeting the foregoing
requirements and in each case on any Business Day in such city.

"Bearer Security" means any Debt Security, in the form
established pursuant to Section 2.01, which is payable to bearer.

"Board of Directors" means either the board of directors of the
Company or any committee of that board or any other committee of the
Company, duly authorized by the board of directors of the Company to
act hereunder.

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

"Business Day" when used with respect to any Place of Payment or
any other particular location referred to in this Indenture or in the
Debt Securities means any day which is not a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust
companies in that Place of Payment or other location are authorized or
obligated by law to close, except as otherwise specified pursuant to
Section 3.01.

2
<PAGE>

"CEDEL" means Centrale de Livraison de Valeurs Mobilieres, S.A.,
or its successor.

"Closing Price" of the Common Stock shall mean the last reported
sale price of such stock (regular way) as shown on the Composite Tape
of the New York Stock Exchange or, in case no such sale takes place on
such day, the average of the closing bid and asked prices on the New
York Stock Exchange.

"Code" means the Internal Revenue Code of 1986, as amended.

"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange
Act of 1934, as amended, 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 on such date.

"Common Depositary" has the meaning specified in Section 3.04(b).

"Common Stock" shall mean the class of Common Stock, par value
$2.50 per share, of the Company authorized at the date of this
Indenture as originally signed, or any other class of stock resulting
from successive changes or reclassifications of such Common Stock, and
in any such case including any shares thereof authorized after the
date of this Indenture, and any other shares of stock of the Company
which do not have any priority in the payment of dividends or upon
liquidation over any other class of stock.

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

"Company Request" and "Company Order" mean, respectively, a
written request or order signed in the name of the Company by the
President or an Executive or Senior Vice President and by the
Treasurer, an Assistant Treasurer, the Controller, an Assistant
Controller, the Secretary or an Assistant Secretary of the Company,
and delivered to the Trustee.

"Component Currency" has the meaning specified in Section
3.10(i).

"Consolidated Net Tangible Assets" means the total amount of
assets (including investments in Joint Ventures) of the Company and its
subsidiaries (less applicable depreciation, amortization and other
valuation reserves) after deducting therefrom (a) all current
liabilities of the Company and its subsidiaries (excluding (i) the
current portion of long-term indebtedness, (ii) intercompany
liabilities and (iii) any liabilities which are by their terms
renewable or extendible at the option of the obligor thereon to a time
more than 12 months from the time as of which the amount thereof
is being computed) and (b) all goodwill, trade names, trademarks,
patents, unamortized debt discount and any other like intangibles, all
as set forth on the most recent consolidated balance sheet of the
Company and computed in accordance with generally accepted accounting
principles.

"Conversion Agent" means any Person authorized by the Company to
receive Debt Securities to be converted into Common Stock on behalf of
the Company. The Company initially authorizes the Trustee to act as
Conversion Agent for the Debt Securities on its behalf. The Company
may at any time or from time to time authorize one or more Persons to
act as Conversion Agent in addition to or in place of the Trustee with
respect to any series of Debt Securities issued under this Indenture.

"Conversion Date" has the meaning specified in Section 3.10(e).

"Conversion Event" means the cessation of (i) a Foreign Currency
to be used both by the government of the country which issued such
Currency and for the settlement of transactions by public institutions
of or within the international banking community,

3
<PAGE>

(ii) the ECU to be used both within the European Monetary System and for
the settlement of transactions by public institutions of or within the
European Communities or (iii) any Currency unit other than the ECU to be
used for the purposes for which it was established.

"Conversion Price" means, with respect to any series of Debt
Securities which are convertible into Common Stock, the price per
share of Common Stock at which the Debt Securities of such series are
so convertible pursuant to Section 3.01 with respect to such series,
as the same may be adjusted from time to time in accordance with
Section 16.03.

"Corporate Trust Office" means the principal corporate trust
office of the Trustee at which at any particular time its corporate
trust business shall be administered, which office at the date of
execution of this instrument is located at ________________________
________________________________.

"corporation" means a corporation, association, company or
business trust.

"Coupon" means any interest coupon appertaining to any Debt
Security.

"Coupon Security" means any Bearer Security authenticated and
delivered with one or more Coupons appertaining thereto.

"Currency" means Dollars or Foreign Currency.

"Currency Determination Agent" means the New York Clearing House
bank, if any, from time to time selected by the Trustee for purposes
of Section 3.10; PROVIDED that such agent shall accept such
appointment in writing and the terms of such appointment shall be
acceptable to the Company and shall, in the opinion of the Company and
the Trustee at the time of such appointment, require such agent to
make the determinations required by this Indenture by a method
consistent with the method provided in this Indenture for the making
of such decision or determination.

"Current Market Price" on any date shall mean the average of the
daily Closing Prices per share of Common Stock for any thirty (30)
consecutive Trading Days selected by the Company prior to the date in
question, which thirty (30) consecutive Trading Day period shall not
commence more than forty-five (45) Trading Days prior to the day in
question; PROVIDED that with respect to Section 16.03(3), the "Current
Market Price" of the Common Stock shall mean the average of the daily
Closing Prices per share of Common Stock for the five (5) consecutive
Trading Days ending on the date of the distribution referred to in
Section 16.03(3) (or if such date shall not be a Trading Day, on the
Trading Day immediately preceding such date).

"Debt Securities" has the meaning stated in the first recital of
this Indenture and more particularly means any Debt Securities
(including any Global Note) authenticated and delivered under this
Indenture; PROVIDED, HOWEVER, that, if at any time there is more than
one Person acting as Trustee under this Indenture, "Debt Securities"
with respect to the Indenture as to which such Person is Trustee shall
have the meaning stated in the first recital of this Indenture and
shall more particularly mean Debt Securities

4
<PAGE>

authenticated and delivered under this Indenture, exclusive, however, of
Debt Securities of any series as to which such Person is not Trustee.

"Default" means any event that after notice or lapse of time, or
both, would become an Event of Default.

"Defaulted Interest" has the meaning specified in Section
3.07(c).

"Discharged" has the meaning specified in Section 15.02.

"Discount Security" means any Debt Security which is issued with
"original issue discount" within the meaning of Section 1273(a) of the
Code (or any successor provision) and the regulations thereunder.

"Dollar" or "$" means a dollar or other equivalent unit in such
coin or currency of the United States that, at the time of payment, is
legal tender for the payment of public and private debts.

"Dollar Equivalent of the Currency Unit" has the meaning
specified in Section 3.10(h).

"Dollar Equivalent of the Foreign Currency" has the meaning
specified in Section 3.10(g).

"ECU" means the European Currency Unit as defined and revised
from time to time by the Council of the European Communities.

"Election Date" has the meaning specified in Section 3.10(i).

"Euro-clear Operator" means Morgan Guaranty Trust Company of New
York, Brussels office, or its successor, as operator of the Euro-clear
System.

"European Communities" means the European Economic Community, the
European Coal and Steel Community and the European Atomic Energy
Community.

"European Monetary System" means the European Monetary System
established by the Resolution of December 5, 1978 of the Council of
the European Communities.

"Event of Default" has the meaning specified in Section 5.01.

"Exchange Date" has the meaning specified in Section 3.04(b).

"Exchange Rate Officer's Certificate" means a telex or a
certificate setting forth (i) the applicable Market Exchange Rate and
(ii) the Dollar, Foreign Currency or Currency unit amounts of
principal, premium, if any, and any interest respectively (on an
aggregate basis and on the basis of a Debt Security having the lowest
denomination principal amount determined in accordance with Section
3.02 in the relevant Currency or Currency unit), payable on the basis
of such Market Exchange Rate sent (in the case of a telex) or signed
(in the case of a certificate) by the Treasurer or any Assistant
Treasurer of the Company.

5
<PAGE>

"Floating Rate Security" means a Debt Security which provides for
the payment of interest at a variable rate determined periodically by
reference to an interest rate index or any other index specified
pursuant to Section 3.01.

"Foreign Currency" means a currency issued by the government of
any country other than the United States or a composite currency or
currency unit the value of which is determined by reference to the
values of the currencies of any group of countries.

"Gaming Authority" means the Nevada Gaming Commission, the Nevada
State Gaming Control Board, the New Jersey Casino Control Commission
or any similar commission or agency which has, or may at any time
after the date of this Indenture have, jurisdiction over the gaming
activities of the Company or a subsidiary of the Company or any
successor thereto.

"Gaming Laws" means the gaming laws of a jurisdiction or
jurisdictions to which the Company or a subsidiary of the Company is,
or may at any time after the date of this Indenture be, subject.

"Global Note" means a Registered or Bearer Security evidencing
all or part of a series of Debt Securities, including, without
limitation, any temporary or permanent Global Note.

"Holder" means, with respect to a Registered Security, the
Registered Holder, and with respect to a Bearer Security or a Coupon,
the bearer thereof.

"Indenture" means this instrument as originally executed, or as
it may from time to time be supplemented or amended by one or more
indentures supplemental hereto entered into pursuant to the applicable
provisions hereof and, unless the context otherwise requires, shall
include the terms of a particular series of Debt Securities as
established pursuant to Section 3.01; PROVIDED, however, that, if at
any time more than one Person is acting as Trustee under this
instrument, "Indenture" shall mean, with respect to any one or more
series of Debt Securities for which such Person is Trustee, this
instrument as originally executed or as it may be supplemented or
amended from time to time by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof and
shall include the terms of the, or those, particular series of Debt
Securities for which such Person is Trustee established as
contemplated by Section 3.01, exclusive, however, of any provisions or
terms which relate solely to other series of Debt Securities for which
such Person is Trustee, regardless of when such terms or provisions
were adopted, and exclusive of any provisions or terms adopted by
means of one or more indentures supplemental hereto executed and
delivered after such Person had become such Trustee but to which such
Person, as such Trustee, was not a party.

"interest" when used with respect to a Discount Security which by
its terms bears interest only on a certain date, means interest
payable after such date, and, when used with respect to a Bearer
Security, includes any additional amounts payable on such Bearer
Security, if so provided pursuant to Section 3.01.

"Interest Payment Date" with respect to any Debt Security means
the Stated Maturity of an installment of interest on such Debt
Security.

"Joint Venture" means any partnership, corporation or other entity,
in which up to and including 50% of the partnership interests, outstanding
voting stock or other equity interests is owned, directly or indirectly, by
the Company and/or one or more subsidiaries.

6
<PAGE>

"Market Exchange Rate" means (i) for any conversion involving a
Currency unit on the one hand and Dollars or any Foreign Currency on
the other, the exchange rate between the relevant Currency unit and
Dollars or such Foreign Currency calculated by the method specified
pursuant to Section 3.01 for the securities of the relevant series,
(ii) for any conversion of Dollars into any Foreign Currency, the noon
(New York City time) buying rate for such Foreign Currency for cable
transfers quoted in New York City as certified for customs purposes by
the Federal Reserve Bank of New York and (iii) for any conversion of
one Foreign Currency into Dollars or another Foreign Currency, the
spot rate at noon local time in the relevant market at which, in
accordance with normal banking procedures, the Dollars or Foreign
Currency into which conversion is being made could be purchased with
the Foreign Currency from which conversion is being made from major
banks located in either New York City, London or any other principal
market for Dollars or such purchased Foreign Currency. In the event
of the unavailability of any of the exchange rates provided for in the
foregoing clauses (i), (ii) and (iii) the Currency Determination
Agent, if any, or if there shall not be a Currency Determination
Agent, then the Trustee, shall use, in its sole discretion and without
liability on its part, such quotation of the Federal Reserve Bank of
New York as of the most recent available date, or quotations from one
or more major banks in New York City, London or other principal market
for such Currency or Currency unit in question, or such other
quotations as the Currency Determination Agent or the Trustee, as the
case may be, shall deem appropriate. Unless otherwise specified by
the Currency Determination Agent, if any, or if there shall not be a
Currency Determination Agent, then by the Trustee, if there is more
than one market for dealing in any Currency or Currency unit by reason
of foreign exchange regulations or otherwise, the market to be used in
respect of such Currency or Currency unit shall be that upon which a
nonresident issuer of securities designated in such Currency or
Currency unit would purchase such Currency or Currency unit in order
to make payments in respect of such securities.

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

"Non-recourse Indebtedness" means indebtedness the terms of which
provide that the lender's claim for repayment of such indebtedness is
limited solely to a claim against the property which secures such
indebtedness.

"Officers' Certificate" means a certificate signed by the
President or an Executive or Senior Vice President and by the
Treasurer, an Assistant Treasurer, the Controller, an Assistant
Controller, the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee.

"Opinion of Counsel" means a written opinion of counsel, who may
be counsel to the Company (including an employee of the Company).

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

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

7
<PAGE>

(ii) Debt Securities for whose payment or redemption (including
repayment at the option of the Holder) money in the necessary amount has
been theretofore deposited with the Trustee or any Paying Agent (other than
the Company) in trust or set aside and segregated in trust by the Company
(if the Company shall act as its own Paying Agent) for the Holders of such
Debt Securities and any Coupons thereto pertaining; PROVIDED, HOWEVER, that
if such Debt Securities are to be redeemed, then notice of such redemption
has been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made and the date for such redemption
has passed;

(iii) Debt Securities, except to the extent provided in
Section 15.02, with respect to which the Company has effected defeasance as
provided in Article Fifteen;

(iv) Debt Securities which have been paid pursuant to Section 3.06 or
in exchange for or in lieu of which other Debt Securities have been
authenticated and delivered pursuant to this Indenture, other than any such
Debt Securities in respect of which there shall have been presented to the
Trustee proof satisfactory to it that such Debt Securities are held by a
bona fide purchaser in whose hands such Debt Securities are valid
obligations of the Company; and

(v) Debt Securities converted into Common Stock or Preferred Stock
pursuant to or in accordance with this Indenture;

PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
principal amount of Debt Securities Outstanding have performed any Act
hereunder, Debt Securities owned by the Company or any other obligor upon
the Debt Securities or any Affiliate of the Company or of such other
obligor shall be disregarded and deemed not to be Outstanding (PROVIDED,
that in connection with any offer by the Company or any obligor to purchase
Debt Securities, Debt Securities rendered by a Holder shall be Outstanding
until the date of purchase), except that, in determining whether the
Trustee shall be protected in relying upon any such Act, only Debt
Securities which the Trustee knows to be so owned shall be so disregarded.
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 to act with respect to such Debt Securities
and that the pledgee is not the Company or any other obligor upon the Debt
Securities or any Affiliate of the Company or of such other obligor. In
determining whether the Holders of the requisite principal amount of
Outstanding Debt Securities have performed any Act hereunder, the principal
amount of a Discount Security that shall be deemed to be Outstanding for
such purpose 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 5.02 and the
principal amount of a Debt Security denominated in a Foreign Currency that
shall be deemed to be Outstanding for such purpose shall be the amount
calculated pursuant to Section 3.10(k)

"Overdue Rate" when used with respect to any series of the Debt
Securities, means the rate designated as such in or pursuant to the
Board Resolution or the supplemental indenture, as the case may be,
relating to such series as contemplated by Section 3.01.

"Paying Agent" means any Person authorized by the Company to pay
the principal of (and premium, if any) or interest on any Debt
Securities on behalf of the Company.

8
<PAGE>

"permanent Global Note" shall have the meaning given such term in
Section 3.04(b).

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

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

"Predecessor 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 3.06 in lieu of a mutilated, lost, destroyed
or stolen Debt Security or a Debt Security to which a mutilated, lost,
destroyed or stolen Coupon appertains shall be deemed to evidence the
same debt as the mutilated, lost, destroyed or stolen Debt Security or
the Debt Security to which the mutilated, lost, destroyed or stolen
Coupon appertains, as the case may be.

"Preferred Stock" means, with respect to any Person, all capital
stock, if any, issued by such Person that is entitled to a preference
or priority over any other capital stock issued by such Person with
respect to any distribution of such Person's assets, whether by
dividend or upon any voluntary or involuntary liquidation, dissolution
or winding up.

"Redemption Date" means the date fixed for redemption of any Debt
Security pursuant to this Indenture.

"Redemption Price" means, in the case of a Discount Security, the
amount of the principal thereof that would be due and payable as of
the Redemption Date upon a declaration of acceleration pursuant to
Section 5.02, and in the case of any other Debt Security, the
principal amount thereof, plus, in each case, premium, if any, and
accrued and unpaid interest, if any, to the Redemption Date.

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

"Registered Security" means any Debt Security in the form
established pursuant to Section 2.01 which is registered as to
principal and interest in the Security Register.

"Regular Record Date" for the interest payable on the Registered
Securities of any series on any Interest Payment Date means the date
specified for the purpose pursuant to Section 3.01 for such Interest
Payment Date.

"Responsible Officer" when used with respect to the Trustee means
any vice president, the secretary, any assistant secretary or any
assistant vice president 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

9
<PAGE>

corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.

"Security Register" and "Security Registrar" have the respective
meanings specified in Section 3.05(a).

"Special Record Date" for the payment of any Defaulted Interest
means a date fixed by the Trustee pursuant to Section 3.07(c).

"Specified Amount" has the meaning specified in Section 3.10(i).

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

"temporary Global Note" shall have the meaning given such term in
Section 3.04(b).

"Trading Day" shall mean, with respect to the Common Stock, so
long as the Common Stock is listed or admitted to trading on the New
York Stock Exchange, a day on which the New York Stock Exchange is
open for the transaction of business.

"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have
become such pursuant to the applicable provisions of this Indenture,
and thereafter "Trustee" shall mean or include each Person who is then
a Trustee hereunder, and if at any time there is more than one such
Person, then "Trustee" as used with respect to the Debt Securities of
any series shall mean the Trustee with respect to Debt Securities of
such series.

"Trust Indenture Act" means the Trust Indenture Act of 1939, as
it may be amended from time to time.

"United States" means the United States of America (including the
States and the District of Columbia), its territories and possessions
and other areas subject to its jurisdiction.

"U.S. Depositary" means a clearing agency registered under the
Securities Exchange Act of 1934, as amended, or any successor thereto,
which shall in either case be designated by the Company pursuant to
Section 3.01 until a successor U.S. Depositary shall have become such
pursuant to the applicable provisions of this Indenture, and
thereafter "U.S. Depositary" shall mean or include each Person who is
then a U.S. Depositary hereunder, and if at any time there is more
than one such Person, then "U.S. Depositary" as used with respect to
the Debt Securities of any series shall mean the U.S. Depositary with
respect to the Debt Securities of that series.

"U.S. Government Obligations" has the meaning specified in
Section 15.02.

"Valuation Date" has the meaning specified in Section 3.10(d).

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"Vice President" includes, with respect to the Company, any
Executive or Senior Vice President and includes, with respect to the
Trustee, any Vice President, whether or not designated by a number or
word or words added before or after the title "Vice President."

Section 1.02. COMPLIANCE CERTIFICATES AND OPINIONS.

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

Every certificate or opinion with respect to compliance with a
condition or covenant PROVIDED for in this Indenture (other than certificates
provided pursuant to Section 12.02) shall include:

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

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

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

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

Section 1.03. FORM OF DOCUMENTS DELIVERED TO TRUSTEE.

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

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

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

Section 1.04. NOTICES, ETC., TO TRUSTEE AND COMPANY.

Any Act of Holders or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed with:

(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or filed in writing to or with the Trustee at its
Corporate Trust Office, Attention: Corporate Trust Department, or

(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if
in writing and mailed, first-class postage prepaid or airmail postage
prepaid if sent from outside the United States, to the Company addressed to
it at the address of its principal office specified in the first paragraph
of this instrument, to the attention of its Treasurer, or at any other
address previously furnished in writing to the Trustee by the Company.

Any such Act or other document shall be in the English language,
except that any published notice may be in an official language of the country
of publication.

Section 1.05. NOTICE TO HOLDERS; WAIVER.

When this Indenture provides for notice to Holders of any event, (1)
such notice shall be sufficiently given to Registered Holders (unless otherwise
herein expressly provided) if in writing and mailed, first-class postage
prepaid, to such Registered Holders as their names and addresses appear in the
Security Register, within the time prescribed, and (2) such notice shall be
sufficiently given to Holders of Bearer Securities or Coupons (unless otherwise
herein expressly provided) if published at least twice in an Authorized
Newspaper or Newspapers in the City of New York and, if Debt Securities of such
series are then listed on The Stock Exchange of the United Kingdom and the
Republic of Ireland or the Luxembourg Stock Exchange or any other stock exchange
located outside the United States and such stock exchange shall so require, in a
daily newspaper in London or Luxembourg or in such other city or cities
specified pursuant to Section 3.01 or in any Debt Security on Business Days, the
first such publication to be not earlier than the earliest date and not later
than two Business Days prior to the latest date prescribed for the giving of
such notice; PROVIDED, HOWEVER, that, in any case, any notice to Holders of
Floating Rate Securities regarding the determination of a periodic rate of
interest, if such notice is required pursuant to Section 3.01, shall be
sufficiently given if given in the manner specified pursuant to Section 3.01.

In the event of suspension of regular mail service or by reason of any
other cause it shall be impracticable to give notice by mail, such notification
as shall be given with the approval of the Trustee shall constitute sufficient
notice for every purpose hereunder.

In the event of suspension of publication of any Authorized Newspapers
or by reason of any other cause it shall be impracticable to give notice by
publication, such notification as shall be given with the approval of the
Trustee shall constitute sufficient notice for every purpose hereunder.

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<PAGE>

Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken in
reliance on such waiver. In any case where notice to Holders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders, and any notice which is mailed in the manner herein
provided shall be conclusively presumed to have been duly given. In any case
where notice to Holders is given by publication, any defect in any notice so
published as to any particular Holder shall not affect the sufficiency of such
notice with respect to other Holders, and any notice which is published in the
manner herein provided shall be conclusively presumed to have been duly given.

Section 1.06. CONFLICT WITH TRUST INDENTURE ACT.

If any provision hereof limits, qualifies or conflicts with the duties
imposed on any person by the provisions of Sections 310 to 317, inclusive, of
the Trust Indenture Act, such imposed duties shall control.

Section 1.07. COUNTERPARTS; EFFECT OF HEADINGS AND TABLE OF CONTENTS.

This Indenture may be executed in any number of counterparts, each of
which when executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same Indenture. The Article and
Section headings herein and in the Table of Contents are for convenience only
and shall not affect the construction hereof.

Section 1.08. SUCCESSORS AND ASSIGNS.

All covenants and agreements in this Indenture by the parties hereto
shall bind their respective successors and assigns and inure to the benefit of
their permitted successors and assigns, whether so expressed or not.

Section 1.09. SEPARABILITY CLAUSE.

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

Section 1.10. BENEFITS OF INDENTURE.

Nothing in this Indenture or in the Debt Securities, express or
implied, shall give to any Person, other than the parties hereto, any Security
Registrar, any Paying Agent and their successors hereunder, and the Holders, any
benefit or any legal or equitable right, remedy or claim under this Indenture.

Section 1.11. GOVERNING LAW.

This Indenture, the Debt Securities and the Coupons shall be deemed to
be contracts made and to be performed entirely in the State of New York, and for
all purposes shall be governed by and construed in accordance with the internal
laws of said State without regard to the conflicts of law rules of said State.

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Section 1.12. LEGAL HOLIDAYS.

Unless otherwise specified pursuant to Section 3.01 or in any Debt
Security, in any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Debt Security of any series shall not be a Business Day at any
Place of Payment for the Debt Securities of that series, then (notwithstanding
any other provision of this Indenture or of the Debt Securities or Coupons)
payment of principal (and premium, if any) or interest need not be made at such
Place of Payment on such date, but may be made on the next succeeding Business
Day at such Place of Payment with the same force and effect as if made on the
Interest Payment Date, Redemption Date or at the Stated Maturity, and no
interest shall accrue on the amount so payable for the period from and after
such Interest Payment Date, Redemption Date or Stated Maturity, as the case may
be, to such Business Day if such payment is made or duly provided for on such
Business Day.

Section 1.13. NO RECOURSE AGAINST OTHERS.

No direct or indirect incorporator, employee, stockholder, director or
officer, as such, past, present or future of the Company or any successor
corporation or any of the Company's Affiliates, shall have any personal
liability in respect of the obligations of the Company under the Debt Securities
or this Indenture, either directly or through the Company, by reason of his, her
or its status as such incorporator, stockholder, employee, director or officer.
Each Holder by accepting a Debt Security waives and releases all such liability.
Such waiver and release are part of the consideration for the issuance of the
Debt Securities.

ARTICLE TWO

DEBT SECURITY FORMS

Section 2.01. FORMS GENERALLY.

The Debt Securities and the Coupons, if any, of each series shall be
substantially in the forms of Exhibit A and B hereto, respectively, or in such
other form as shall be established in or pursuant to a Board Resolution or one
or more indentures supplemental hereto, and shall have such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture, and may have such letters, numbers or other marks
of identification or designation and such legends or endorsements placed thereon
as the Company may deem appropriate and as are not inconsistent with the
provisions of this Indenture, or as may be required to comply with any law or
with any rule or regulation made pursuant thereto or with any rule or regulation
of any securities exchange on which any series of the Debt Securities may be
listed, or to conform to usage, all as determined by the officers executing such
Debt Securities and Coupons as conclusively evidenced by their execution of such
Debt Securities and Coupons. If the form of Debt Securities or Coupons (or any
Global Note) of any series is established in or pursuant to a Board Resolution,
a copy of such Board Resolution shall be delivered to the Trustee, together with
an Officers' Certificate setting forth the form of such series, at or prior to
the delivery of the Company Order contemplated by Section 3.03 for the
authentication and delivery of such Debt Securities (or any such Global Note) or
Coupons.

Unless otherwise specified as contemplated by Section 3.01, Bearer
Securities (other than in global form) shall have Coupons attached.

Subject to Section 3.04, the definitive Debt Securities and Coupons,
if any, of each series shall be printed, lithographed or engraved or produced by
any combination of these methods on steel

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<PAGE>

engraved borders or may be produced in any other manner, all as determined by
the officers executing such Debt Securities and Coupons, as conclusively
evidenced by their execution of such Debt Securities and Coupons.

Section 2.02. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.

The form of the Trustee's certificate of authentication to be borne by
the Debt Securities shall be substantially as follows:

TRUSTEE'S CERTIFICATE OF AUTHENTICATION

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

[NAME OF TRUSTEE], as Trustee

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

Section 2.03. SECURITIES IN GLOBAL FORM.

If any Debt Security of a series is issued as a Global Note, such
Global Note may provide that it shall represent the aggregate amount of
Outstanding Debt Securities from time to time endorsed thereon and may also
provide that the aggregate amount of Outstanding Debt Securities represented
thereby may from time to time be reduced to reflect exchanges. Any endorsement
of a Global Note to reflect the amount, or any increase or decrease in the
amount, of Outstanding Debt Securities represented thereby shall be made by the
Trustee and in such manner as shall be specified in such Global Note. Any
instructions by the Company with respect to a Global Note, after its initial
issuance, shall be in writing but need not comply with Section 1.02.

Global Notes may be issued in either registered or bearer form and in
either temporary or permanent form. Permanent Global Notes will be issued in
definitive form.

Every Global Note authenticated and delivered hereunder shall bear a
legend in substantially the following form:

THIS DEBT SECURITY IS A GLOBAL NOTE WITHIN THE MEANING OF
THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN
THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS DEBT
SECURITY MAY NOT BE TRANSFERRED TO, OR REGISTERED OR
EXCHANGED FOR SECURITIES REGISTERED IN THE NAME OF, ANY
PERSON OTHER THAN THE DEPOSITARY OR A NOMINEE THEREOF AND NO
SUCH TRANSFER MAY BE REGISTERED, EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY DEBT
SECURITY AUTHENTICATED AND DELIVERED UPON REGISTRATION OF
TRANSFER OF, OR IN EXCHANGE FOR OR IN LIEU OF, THIS DEBT
SECURITY SHALL

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<PAGE>

BE A GLOBAL NOTE SUBJECT TO THE FOREGOING, EXCEPT IN SUCH
LIMITED CIRCUMSTANCES.

ARTICLE THREE

THE DEBT SECURITIES

Section 3.01. AMOUNT UNLIMITED; ISSUABLE IN SERIES.

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

The Debt Securities may be issued in one or more series. There shall
be established in or pursuant to a Board Resolution and (subject to Section
3.03) set forth in an Officers' Certificate, or established in one or more
indentures supplemental hereto, prior to the issuance of Debt Securities of any
series:

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

(2) The aggregate principal amount of such series of Debt Securities
and any limit on the aggregate principal amount of the Debt Securities of
the series which may be authenticated and delivered under this Indenture
(except for Debt Securities authenticated and delivered upon transfer of,
or in exchange for, or in lieu of, other Debt Securities of such series
pursuant to Sections 3.04, 3.05, 3.06, 11.06 or 13.07);

(3) The percentage of the principal amount at which the Debt
Securities of such series will be issued and, if other than the principal
amount thereof, the portion of the principal amount thereof payable upon
declaration of acceleration of the maturity or upon redemption thereof or
the method by which such portion shall be determined;

(4) The date or dates on which, or periods during which, the Debt
Securities of the series may be issued, and the date or dates or the method
by which such date or dates will be determined, on which the principal of
(and premium, if any, on) the Debt Securities of such series are or may be
payable (which, if so provided in such Board Resolution or supplemental
indenture, may be determined by the Company from time to time as set forth
in the Debt Securities of the series issued from time to time);

(5) The rate or rates (which may be fixed or variable) at which the
Debt Securities of the series shall bear interest, if any, or the method by
which such rate or rates shall be determined, the date or dates from which
such interest, if any, shall accrue or the method by which such date or
dates shall be determined (which, in either case or both, if so provided in
such Board Resolution or supplemental indenture, may be determined by the
Company from time to time and set forth in the Debt Securities of the
series issued from time to time) and the circumstances, if any, in which
the Company may defer interest payments; and the Interest Payment Dates on
which such interest shall be payable (or the method of determination
thereof), and the Regular Record Dates, if any, for the interest payable on
such Interest Payment Dates and the notice, if any, to Holders regarding
the determination of interest, the manner of giving such notice, the basis
upon which interest shall be calculated if other than that of a 360-day
year of twelve 30-day months and any conditions or contingencies as to the
payment of interest in cash or otherwise, if any;

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<PAGE>

(6) The place or places, if any, in addition to or instead of the
Corporate Trust Office of the Trustee (in the case of Registered
Securities) or the principal London office of the Trustee (in the case of
Bearer Securities), where the principal of (and premium, if any) and
interest on Debt Securities of the series shall be payable and where such
Debt Securities may be surrendered for conversion or registration of
transfer or exchange; the extent to which, or the manner in which, any
interest payable on any Global Note on an Interest Payment Date will be
paid, if other than in the manner provided in Section 3.07; the extent, if
any, to which the provisions of the last sentence of Section 12.01 shall
apply to the Debt Securities of the series; and the manner in which any
principal of, or premium, if any, on, any Global Note will be paid, if
other than as set forth elsewhere herein and whether any Global Note will
require any notation to evidence payment of principal or interest;

(7) The obligation, if any, of the Company to redeem, repay, purchase
or offer to purchase Debt Securities of the series pursuant to any
mandatory redemption, sinking fund or analogous provisions or upon other
conditions or at the option of the Holder thereof and the period or periods
within which or the dates on which, the prices at which and the terms and
conditions upon which the Debt Securities of the series shall be redeemed,
repaid, purchased or offered to be purchased, in whole or in part, pursuant
to such obligation;

(8) The right, if any, of the Company to redeem the Debt Securities
of such series at its option and the period or periods within which, or the
date or dates on which, the price or prices at which, and the terms and
conditions upon which, such Debt Securities may be redeemed, if any, in
whole or in part, at the option of the Company or otherwise;

(9) If the coin or Currency in which the Debt Securities shall be
issuable is in Dollars, the denominations of such Debt Securities if other
than denominations of $1,000 and any integral multiple thereof (except as
provided in Section 3.04);

(10) Whether the Debt Securities of the series are to be issued as
Discount Securities and the amount of discount with which such Debt
Securities may be issued and, if other than the principal amount thereof,
the portion of the principal amount of Debt Securities of the series which
shall be payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 5.02;

(11) Additional provisions, if any, for the defeasance or discharge of
certain of the Company's obligations with respect to Debt Securities of the
series, which provisions may be in addition to, or in substitution for, or
in modification of (or any combination of the foregoing), the provisions of
the Indenture;

(12) Whether Debt Securities of the series are to be issued as
Registered Securities or Bearer Securities or both, and, if Bearer
Securities are issued, whether Coupons will be attached thereto, whether
such Bearer Securities of the series may be exchanged for Registered
Securities of the series, as provided in Section 3.05(b) or otherwise and
the circumstances under which and the place or places at which any such
exchanges, if permitted, may be made;

(13) Whether provisions for payment of additional amounts or tax
redemptions shall apply and, if such provisions shall apply, such
provisions; and, if Bearer Securities of the series are to be issued,
whether a procedure other than that set forth in Section 3.04(b) shall
apply and, if so, such other procedure, and if the procedure set forth in
Section 3.04(b) shall apply, the forms of certifications to be delivered
under such procedure;

<PAGE>

(14) If other than Dollars, the Foreign Currency or Currencies in
which Debt Securities of the series shall be denominated or in which
payment of the principal of (and premium, if any) and interest on the Debt
Securities of the series may be made, and the particular provisions
applicable thereto and, if applicable, the amount of Debt Securities of the
series which entitles the Holder of a Debt Security of the series or its
proxy to one vote for purposes of Section 9.05;

(15) If the principal of (and premium, if any) or interest on Debt
Securities of the series are to be payable, at the election of the Company
or a Holder thereof, in a Currency other than that in which the Debt
Securities are denominated or payable without such election, in addition to
or in lieu of the provisions of Section 3.10, the period or periods within
which and the terms and conditions upon which, such election may be made
and the time and the manner of determining the exchange rate or rates
between the Currency or Currencies in which the Debt Securities are
denominated or payable without such election and the Currency or Currencies
in which the Debt Securities are to be paid if such election is made;

(16) The date as of which any Debt Securities of the series shall be
dated, if other than as set forth in Section 3.03;

(17) If the amount of payments of principal of (and premium, if any)
or interest on the Debt Securities of the series may be determined with
reference to an index, including, but not limited to, an index based on a
Currency or Currencies other than that in which the Debt Securities are
denominated or payable, or any other type of index, the manner in which
such amounts shall be determined;

(18) If the Debt Securities of the series are denominated or payable
in a Foreign Currency, any other terms concerning the payment of principal
of (and premium, if any) or any interest on such Debt Securities (including
the Currency or Currencies of payment thereof);

(19) The designation of the original Currency Determination Agent, if
any;

(20) The applicable Overdue Rate, if any;

(21) If the Debt Securities of the series do not bear interest, the
applicable dates for purposes of Section 7.01;

(22) Any addition to, or modification or deletion of, any Event of
Default or covenant provided for in this Indenture with respect to Debt
Securities of the series;

(23) If Bearer Securities of the series are to be issued, (x) whether
interest in respect of any portion of a temporary Debt Security in global
form (representing all of the Outstanding Bearer Securities of the series)
payable in respect of any Interest Payment Date prior to the exchange of
such temporary Debt Security for definitive Debt Securities of the series
shall be paid to any clearing organization with respect to the portion of
such temporary Debt Security held for its account and, in such event, the
terms and conditions (including any certification requirements) upon which
any such interest payment received by a clearing organization will be
credited to the Persons entitled to interest payable on such Interest
Payment Date, (y) the terms upon which interests in such temporary Debt
Security in global form may be exchanged for interests in a permanent
Global Note or for definitive Debt Securities of the series and the terms
upon which interests in a permanent Global Note, if any, may be exchanged
for definitive Debt

<PAGE>

Securities of the series and (z) the cities and the Authorized Newspapers
designated for the purposes of giving notices to Holders;

(24) Whether the Debt Securities of the series shall be issued in
whole or in part in the form of one or more Global Notes and, in such case,
the U.S. Depositary or any Common Depositary for such Global Note or Notes;
and if the Debt Securities of the series are issuable only as Registered
Securities, the manner in which and the circumstances under which Global
Notes representing Debt Securities of the series may be exchanged for
Registered Securities in definitive form, if other than, or in addition to,
the manner and circumstances specified in Section 3.04(c);

(25) The designation, if any, of any depositaries, trustees (other
than the Trustee), Paying Agents, Authenticating Agents, Conversion Agents,
Security Registrars (other than the Trustee) or other agents with respect
to the Debt Securities of such series;

(26) If the Debt Securities of such series will be issuable in
definitive form only upon receipt of certain certificates or other
documents or upon satisfaction of certain conditions, the form and terms of
such certificates, documents or conditions;

(27) Whether the Debt Securities of such series will be convertible
into shares of Common Stock or other securities or property of the Company,
and, if so, the terms and conditions, which may be in addition to or in
lieu of the provisions contained in this Indenture, upon which such Debt
Securities will be so convertible, including the conversion price and the
conversion period;

(28) The portion of the principal amount of the Debt Securities which
will be payable upon declaration of acceleration of the maturity thereof,
if other than the principal amount thereof;

(29) The terms, if any, on which the Debt Securities of such series
will be subordinate to other debt of the Company;

(30) Any listing of the Debt Securities on a securities exchange.

(31) The provisions, if any, relating to any security provided for the
Debt Securities of such series; and

(32) 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 and except as may otherwise be provided in or pursuant
to such Board Resolution and (subject to Section 3.03) set forth in such
Officers' Certificate, or in any such indenture supplemental hereto. All Debt
Securities of any one series need not be issued at the same time, and unless
otherwise PROVIDED, a series may be reopened for issuance of additional Debt
Securities of such series.

If any of the terms of a series of Debt Securities is established in
or pursuant to a Board Resolution, a copy of such Board Resolution shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.

<PAGE>

Section 3.02. DENOMINATIONS.

In the absence of any specification pursuant to Section 3.01 with
respect to the Debt Securities of any series, the Debt Securities of such series
shall be issuable only as Registered Securities in denominations of $1,000 and
any integral multiple thereof and shall be payable only in Dollars.

Section 3.03. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.

The Debt Securities and the Coupons, if any, of any series shall be
executed on behalf of the Company by its President, one of its Executive or
Senior Vice Presidents or its Treasurer, under its corporate seal reproduced
thereon and attested by its Secretary or one of its Assistant Secretaries. The
signature of any of these officers may be manual or facsimile.

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

At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Debt Securities, with appropriate
Coupons, if any, of any series, executed by the Company, to the Trustee for
authentication, together with a Company Order for the authentication and
delivery of such Debt Securities and Coupons and the Trustee in accordance with
the Company Order shall authenticate and deliver such Debt Securities and
Coupons; PROVIDED, HOWEVER, that, in connection with its sale during the
"restricted period" (as defined in Section 1.163-5(c)(2)(i)(D)(7) of the United
States Treasury Regulations), no Bearer Security shall be mailed or otherwise
delivered to any location in the United States; and PROVIDED, FURTHER, that a
Bearer Security (other than a temporary Global Note in bearer form) may be
delivered outside the United States in connection with its original issuance
only if the Person entitled to receive such Bearer Security shall have furnished
to the Euro-clear operator or to CEDEL a certificate substantially in the form
set forth in Exhibit C to this Indenture. If all the Debt Securities of any one
series are not to be issued at one time and if a Board Resolution or
supplemental indenture relating to such series shall so permit, such Company
Order may set forth procedures acceptable to the Trustee for the issuance of
such Debt Securities such as interest rate, Stated Maturity, date of issuance
and date from which interest, if any, shall accrue. If any Debt Security shall
be represented by a permanent Global Note, then, for purposes of this Section
and Section 3.04, the notation of a beneficial owner's interest therein upon
original issuance of such Debt Security or upon exchange of a portion of a
temporary Global Note shall be deemed to be delivery in connection with the
original issuance of such beneficial owner's interest in such permanent Global
Note. Except as permitted by Section 3.06 or 3.07, the Trustee shall not
authenticate and deliver any Bearer Security unless all Coupons for interest
then matured have been detached and cancelled.

The Trustee shall be entitled to receive, and (subject to Section
6.01) shall be fully protected in relying upon, prior to the authentication and
delivery of the Debt Securities and Coupons of such series, (i) the supplemental
indenture or the Board Resolution by or pursuant to which the form and terms of
such Debt Securities and Coupons have been approved, (ii) an Officers'
Certificate stating that all conditions precedent provided for in the Indenture
have been complied with and that, to the best knowledge of the signers of such
certificates, no Event of Default with respect to any of the Debt Securities
shall have occurred and be continuing and (iii) an Opinion of Counsel
substantially to the effect that:

<PAGE>

(1) the forms and terms of such Debt Securities and Coupons, if any,
have been established in conformity with the provisions of this Indenture;
and

(2) such Debt Securities and Coupons, if any, when completed by
appropriate insertions and executed and delivered by the Company to the
Trustee in accordance with the Indenture, authenticated and delivered by
the Trustee in accordance with this Indenture and issued by the Company in
the manner and subject to any conditions specified in such Opinion of
Counsel, will constitute legal, valid and binding obligations of the
Company, enforceable against the Company in accordance with their terms,
subject to applicable bankruptcy, insolvency, fraudulent transfer and
similar laws affecting creditors' rights generally and to general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).

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

Each Registered Security shall be dated the date of its
authentication. Each Bearer Security (including any temporary or permanent or
other definitive Bearer Security in global form) shall be dated as of the date
of original issuance of the first Debt Security of such series to be issued,
except as otherwise provided pursuant to Section 3.01 with respect to the Bearer
Securities of any series.

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 one of the forms
provided for herein duly executed by the Trustee or by an Authenticating Agent,
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 is entitled to the benefits of this Indenture.
Notwithstanding the foregoing, if any Debt Security shall have been duly
authenticated and delivered hereunder but never issued and sold by the Company,
and the Company shall deliver such Debt Security to the Trustee for cancellation
as provided in Section 3.08 together with a written statement (which need not
comply with Section 1.02) stating that such Debt Security has never been issued
and sold by the Company, for all purposes of this Indenture such Debt Security
shall be deemed never to have been authenticated and delivered hereunder and
shall never be entitled to the benefits of this Indenture.

Section 3.04. TEMPORARY DEBT SECURITIES; EXCHANGE OF TEMPORARY GLOBAL
NOTES FOR DEFINITIVE BEARER SECURITIES; GLOBAL NOTES REPRESENTING REGISTERED
SECURITIES.

(a) Pending the preparation of definitive Registered Securities of
any series, the Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Registered Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination for Registered Securities of such series, substantially of the
tenor of the definitive Registered Securities in lieu of which they are issued
and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Registered Securities may determine,
as conclusively evidenced by their execution of such Registered Securities.
Every such temporary Registered Security shall be executed by the Company and
shall be authenticated and delivered by the Trustee upon the same conditions and
in substantially the same manner, and with the same effect, as the definitive
Registered Securities in lieu of which they are issued. In the case of any
series issuable as Bearer Securities, such temporary Debt Securities may be in
global form, representing such of the Outstanding Debt Securities of such series
as shall be specified therein.

<PAGE>

Except in the case of temporary Debt Securities in global form (which
shall be exchanged in accordance with the provisions of the following
paragraphs), 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 such
series, the temporary Debt Securities of such series shall be exchangeable for
definitive Debt Securities of such series, of a like Stated Maturity and with
like terms and provisions, upon surrender of the temporary Debt Securities of
such series at the office or agency of the Company in a Place of Payment for
such series, without charge to the Holder, except as provided in Section 3.05 in
connection with a transfer. Upon surrender for cancellation of any one or more
temporary Debt Securities of any series (accompanied by any unmatured Coupons),
the Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor a like principal amount of definitive Debt Securities of the
same series of authorized denominations and of a like Stated Maturity and like
terms and provisions; PROVIDED, HOWEVER, that no definitive Bearer Security
shall be delivered in exchange for a temporary Registered Security; and
PROVIDED, FURTHER, that a definitive Bearer Security (including a permanent
Bearer Security in global form) shall be delivered in exchange for a temporary
Bearer Security only in compliance with the conditions set forth in Section
3.03. Until so exchanged, the temporary Registered Securities of any series
shall in all respects be entitled to the same benefits under this Indenture as
definitive Registered Securities of such series.

(b) Unless otherwise specified pursuant to Section 3.01, all Bearer
Securities of a series shall be initially issued in the form of a single
temporary Bearer Security in global form (a "temporary Global Note"). The
Company shall execute, and upon Company Order the Trustee shall authenticate,
any temporary Global Note and any permanent Bearer Security in global form (as
described below, a "permanent Global Note") upon the same conditions and in
substantially the same manner, and with the same effect, as definitive Bearer
Securities, and the temporary or permanent Global Note, as the case may be,
shall, unless otherwise specified therein, be delivered by the Trustee to the
London office of a depositary or common depositary (the "Common Depositary"),
for the benefit of the Euro-clear Operator or CEDEL, as the case may be, for
credit to the account of the Company (in the case of sales of Bearer Securities
by the Company directly to investors) or the managing underwriter (in the case
of sales of Bearer Securities by the Company to underwriters) or such other
accounts as the Company or the managing underwriter, respectively, may direct.

On or after the date specified in or determined pursuant to the terms
of any temporary Global Note which (subject to any applicable laws and
regulations) shall be at least 40 days after the issue date of a temporary
Global Note (the "Exchange Date"), the Debt Securities represented by such
temporary Global Note may be exchanged for definitive Debt Securities (subject
to the second succeeding paragraph) or Debt Securities to be represented
thereafter by one or more permanent Global Notes in definitive form without
interest coupons. On or after the Exchange Date such temporary Global Note
shall be surrendered by the Common Depositary to the Trustee, as the Company's
agent for such purpose, at its principal office in London (or at such other
place specified outside the United States pursuant to Section 3.01) and
following such surrender, the Trustee shall (1) endorse the temporary Global
Note to reflect the reduction of its principal amount by an equal aggregate
principal amount of such Debt Security, (2) endorse the applicable permanent
Global Note, if any, to reflect the initial amount, or an increase in the amount
of Debt Securities represented thereby, (3) manually authenticate such
definitive Debt Securities (including any permanent Global Note), (4) deliver
such definitive Debt Securities to the Holder thereof or, if such definitive
Debt Security is a permanent Global Note, deliver such permanent Global Note to
the Common Depositary to be held outside the United States for the accounts of
the Euro-clear Operator or CEDEL, as the case may be, for credit to the
respective accounts at Euro-clear Operator or CEDEL, as the case may be,
designated by or on behalf of the beneficial owners of such Debt Securities (or
to such other accounts as they may direct) and (5) redeliver such temporary
Global Note to the Common Depositary, unless such temporary Global Note shall
have been

<PAGE>

cancelled in accordance with Section 3.08 hereof; PROVIDED, HOWEVER, that,
unless otherwise specified in such temporary Global Note, upon such presentation
by the Common Depositary, such temporary Global Note shall be accompanied by a
certificate dated the Exchange Date or a subsequent date and signed by the
Euro-clear Operator, as to the portion of such temporary Global Note held for
its account then to be exchanged for definitive Debt Securities (including any
permanent Global Note), and a certificate dated the Exchange Date or a
subsequent date and signed by CEDEL, as to the portion of such temporary Global
Note held for its account then to be exchanged for definitive Debt Securities
(including any permanent Global Note), each substantially in the form set forth
in Exhibit D to this Indenture. Each certificate substantially in the form of
Exhibit D hereto of the Euro-clear Operator or CEDEL, as the case may be, shall
be based on certificates of the account holders listed in the records of the
Euro-clear Operator or CEDEL, as the case may be, as being entitled to all or
any portion of the applicable temporary Global Note. An account holder of the
Euro-clear Operator or CEDEL, as the case may be, desiring to effect the
exchange of an interest in a temporary Global Note for an interest in definitive
Debt Securities (including any permanent Global Note) shall instruct the
Euro-clear Operator or CEDEL, as the case may be, to request such exchange on
its behalf and shall deliver to the Euro-clear Operator or CEDEL, as the case
may be, a certificate substantially in the form of Exhibit C hereto and dated no
earlier than 10 days prior to the Exchange Date. Until so exchanged, temporary
Global Notes shall in all respects be entitled to the same benefits under this
Indenture as definitive Debt Securities (including any permanent Global Note) of
the same series authenticated and delivered hereunder, except as to payment of
interest, if any.

The delivery to the Trustee by the Euro-clear Operator or CEDEL of any
certificate substantially in the form of Exhibit D hereto may be relied upon by
the Company and the Trustee as conclusive evidence that a corresponding
certificate or certificates has or have been delivered to the Euro-clear
Operator or CEDEL, as the case may be, pursuant to the terms of this Indenture.

On or prior to the Exchange Date, the Company shall deliver to the
Trustee definitive Debt Securities in an aggregate principal amount equal to the
principal amount of such temporary Global Note, executed by the Company. At any
time, on or after the Exchange Date, upon 30 days' notice to the Trustee by the
Euro-clear Operator or CEDEL, as the case may be, acting at the request of or on
behalf of the beneficial owner, a Debt Security represented by a temporary
Global Note or a permanent Global Note, as the case may be, may be exchanged, in
whole or from time to time in part, for definitive Debt Securities without
charge and the Trustee shall authenticate and deliver, in exchange for each
portion of such temporary Global Note or such permanent Global Note, an equal
aggregate principal amount of definitive Debt Securities of the same series of
authorized denominations and of a like Stated Maturity and with like terms and
conditions, as the portion of such temporary Global Note or such permanent
Global Note to be exchanged, which, unless the Debt Securities of the series are
not issuable both as Bearer Securities and as Registered Securities, as
contemplated by Section 3.01, shall be in the form of Bearer Securities or
Registered Securities, or any combination thereof, as shall be specified by the
beneficial owner thereof; PROVIDED, HOWEVER, that definitive Bearer Securities
shall be delivered in exchange for a portion of the temporary Global Note or the
permanent Global Note only in compliance with the requirements of the second
preceding paragraph. On or prior to the forty-fifth day following receipt by
the Trustee of such notice with respect to a Debt Security, or, if such day is
not a Business Day, the next succeeding Business Day, the temporary Global Note
or the permanent Global Note, as the case may be, shall be surrendered by the
Common Depositary to the Trustee, as the Company's agent for such purpose, to be
exchanged, in whole or from time to time in part, for definitive Debt Securities
without charge following such surrender, upon the request of the Euro-clear
Operator or CEDEL, as the case may be, and the Trustee shall (1) endorse the
applicable temporary Global Note or the permanent Global Note to reflect the
reduction of its principal amount by the aggregate principal amount of such Debt
Security, (2) cause the terms of such Debt Security and Coupons, if any, to be
entered on a

<PAGE>

definitive Debt Security, (3) manually authenticate such definitive Debt
Security, and (4) if a Bearer Security is to be delivered, deliver such
definitive Debt Security outside the United States to the Euro-clear Operator or
CEDEL, as the case may be, for or on behalf of the beneficial owner thereof, in
exchange for a portion of such temporary Global Note or the permanent Global
Note.

Unless otherwise specified in such temporary Global Note or the
permanent Global Note, any such exchange shall be made free of charge to the
beneficial owners of such temporary Global Note or the permanent Global Note,
except that a Person receiving definitive Debt Securities must bear the cost of
insurance, postage, transportation and the like in the event that such Person
does not take delivery of such definitive Debt Securities in person at the
offices of the Euro-clear Operator or CEDEL. Definitive Debt Securities in
bearer form to be delivered in exchange for any portion of a temporary Global
Note or the permanent Global Note shall be delivered only outside the United
States. Notwithstanding the foregoing, in the event of redemption or
acceleration of all or any part of a temporary Global Note prior to the Exchange
Date, a permanent Global Note or definitive Bearer Securities, as the case may
be, will not be issuable in respect of such temporary Global Note or such
portion thereof, and payment thereon will instead be made as provided in such
temporary Global Note.

Until exchanged in full as hereinabove provided, any temporary Global
Note or the permanent Global Note shall in all respects be entitled to the same
benefits under this Indenture as definitive Debt Securities of the same series
and tenor authenticated and delivered hereunder, except that, unless otherwise
specified as contemplated by Section 3.01, interest payable on such temporary
Global Note on an Interest Payment Date for Debt Securities of such series
occurring prior to the applicable Exchange Date shall be payable to the
Euro-clear Operator or CEDEL on such Interest Payment Date upon delivery by the
Euro-clear Operator or CEDEL to the Trustee of a certificate or certificates
substantially in the form set forth in Exhibit D to this Indenture, for credit
without further interest on or after such Interest Payment Date to the
respective accounts of the Persons who are the beneficial owners of such
temporary Global Note on such Interest Payment Date and who have each delivered
to the Euro-clear Operator or CEDEL, as the case may be, a certificate
substantially in the form set forth in Exhibit C to this Indenture.

Any definitive Bearer Security authenticated and delivered by the
Trustee in exchange for a portion of a temporary Global Note or the permanent
Global Note shall not bear a coupon for any interest which shall theretofore
have been duly paid by the Trustee to the Euro-clear Operator or CEDEL, or by
the Company to the Trustee in accordance with the provisions of this
Section 3.04.

With respect to Exhibits C and D to this Indenture, the Company may,
in its discretion and if required or desirable under applicable law or as set
forth in any Board Resolution or supplemental indenture with respect to any
series of Debt Securities, substitute one or more other forms of such exhibits
for such exhibits, eliminate the requirement that any or all certificates be
provided, or change the time that any certificate may be required, provided that
such substitute form or forms or notice of elimination or change of such
certification requirement have theretofore been delivered to the Trustee with a
Company Request and such form or forms, elimination or change is reasonably
acceptable to the Trustee.

(c) If the Company shall establish pursuant to Section 3.01 that the
Registered Securities of a series are to be issued in whole or in part in the
form of one or more Global Notes, then the Company shall execute and the Trustee
shall, in accordance with Section 3.03 and the Company Order with respect to
such series, authenticate and deliver one or more Global Notes in temporary or
permanent form that (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 one or more

<PAGE>

Global Notes, (ii) shall be registered in the name of the U.S. Depositary for
such Global Note or Notes or the nominee of such depositary, and (iii) shall
bear a legend substantially as set forth in Section 2.03.

Notwithstanding any other provision of this Section or Section 3.05,
unless and until it is exchanged in whole or in part for Registered Securities
in definitive form, a Global Note representing all or a portion of the
Registered Securities of a series may not be transferred except as a whole by
the U.S. Depositary for such series to a nominee of such depositary or by a
nominee of such depositary to such depositary or another nominee of such
depositary or by such depositary or any such nominee to a successor U.S.
Depositary for such series or a nominee of such successor depositary.

If at any time the U.S. Depositary for the Debt Securities of a series
notifies the Company that it is unwilling or unable to continue as U.S.
Depositary for the Debt Securities of such series or if at any time the U.S.
Depositary for Debt Securities of a series shall no longer be a clearing agency
registered and in good standing under the Securities Exchange Act of 1934, as
amended, or other applicable statute or regulation, the Company shall appoint a
successor U.S. Depositary with respect to the Debt Securities of such series.
If a successor U.S. Depositary for the Debt Securities of such series is not
appointed by the Company within 90 days after the Company receives such notice
or becomes aware of such condition, the Company will execute, and the Trustee,
upon receipt of a Company Order for the authentication and delivery of
definitive Debt Securities of such series, will authenticate and deliver,
Registered Securities of such series in definitive form in an aggregate
principal amount equal to the principal amount of the Global Note or Notes
representing such series in exchange for such Global Note or Notes.

The Company may at any time and in its sole discretion determine that
the Registered Securities of any series issued in the form of one or more Global
Notes shall no longer be represented by such Global Note or Notes. In such
event, the Company will execute, and the Trustee, upon receipt of a Company
Order for the authentication and delivery of definitive Debt Securities of such
series, will authenticate and deliver, Registered Securities of such series in
definitive form and in an aggregate principal amount equal to the principal
amount of the Global Note or Notes representing such series in exchange for such
Global Note or Notes.

If the Registered Securities of any series shall have been issued in
the form of one or more Global Notes and if an Event of Default with respect to
the Debt Securities of such series shall have occurred and be continuing, the
Company will promptly execute, and the Trustee, upon receipt of a Company Order
for the authentication and delivery of definitive Debt Securities of such
series, will authenticate and deliver, Registered Securities of such series in
definitive form and in an aggregate principal amount equal to the principal
amount of the Global Note or Notes representing such series in exchange for such
Global Note or Notes.

If specified by the Company pursuant to Section 3.01 with respect to
Registered Securities of a series, the U.S. Depositary for such series of
Registered Securities may surrender a Global Note for such series of Debt
Securities in exchange in whole or in part for Registered Securities of such
series in definitive form on such terms as are acceptable to the Company and
such depositary. Thereupon, the Company shall execute and the Trustee shall
authenticate and deliver, without charge:

(i) to each Person specified by the U.S. Depositary a new Registered
Security or Securities of the same series, of any authorized denomination
as requested by such Person in an aggregate principal amount equal to and
in exchange for such Person's beneficial interest in the Global Note; and

25
<PAGE>

(ii) to the U.S. Depositary a new Global Note in a denomination
equal to the difference, if any, between the principal amount of the
surrendered Global Note and the aggregate principal amount of Registered
Securities delivered to Holders thereof.

Upon the exchange of a Global Note for Registered Securities in
definitive form, such Global Note shall be cancelled by the Trustee. Debt
Securities issued in exchange for a Global Note pursuant to this subsection (c)
shall be registered in such names and in such authorized denominations as the
U.S. Depositary for such Global Note, pursuant to instructions from its direct
or indirect participants or otherwise, shall instruct the Trustee. The Trustee
shall deliver such Debt Securities to the Persons in whose names such Debt
Securities are so registered.

Section 3.05. REGISTRATION, TRANSFER AND EXCHANGE.

(a) The Company shall cause to be kept at the Corporate Trust Office
of the Trustee a register (the registers maintained in such office and in any
other office or agency of the Company in a Place of Payment being herein
sometimes collectively referred to as the "Security Register") in which, subject
to such reasonable regulations as it may prescribe, the Company shall provide
for the registration of Registered Securities and of transfers and exchanges of
Registered Securities. The Trustee is hereby appointed "Security Registrar" for
the purpose of registering Registered Securities and registering transfers and
exchanges of Registered Securities as herein provided; PROVIDED, HOWEVER, that
the Company may appoint co-Security Registrars or the terms of any series of
Debt Securities may provide otherwise.

Upon surrender for registration of transfer of any Registered Security
of any series at the office or agency of the Company maintained for such
purpose, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee, one or more new Registered
Securities of the same series of like aggregate principal amount of such
denominations as are authorized for Registered Securities of such series and of
a like Stated Maturity and with like terms and conditions.

Except as otherwise provided in Section 3.04 and this Section 3.05, at
the option of the Holder, Registered Securities of any series may be exchanged
for other Registered Securities of the same series of like aggregate principal
amount and of a like Stated Maturity and with like terms and conditions, upon
surrender of the Registered Securities to be exchanged at such office or agency.
Whenever any Registered Securities are surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and deliver, the Registered
Securities which the Holder making the exchange is entitled to receive.

(b) If and to the extent specified pursuant to Section 3.01, the
provisions of this Section 3.05(b) shall be applicable to Debt Securities of any
series which are Bearer Securities. At the option of the Holder thereof, to the
extent permitted by law, any Bearer Security of any series which by its terms is
registrable as to principal and interest may be exchanged for a Registered
Security of such series of like aggregate principal amount and of a like Stated
Maturity and with like terms and conditions upon surrender of such Bearer
Security at the Corporate Trust Office or at any other office or agency of the
Company designated pursuant to Section 3.01 for the purpose of making any such
exchanges. Any Coupon Security surrendered for exchange shall be surrendered
with all unmatured Coupons and any matured Coupons in default attached thereto.
If the Holder of a Bearer Security is unable to produce any such unmatured
Coupon or Coupons or matured Coupon or Coupons in default, such exchange may be
effected if the Bearer Securities are accompanied by payment in funds acceptable
to the Company in an amount equal to the face amount of such missing Coupon or
Coupons, or the surrender of such missing

26
<PAGE>

Coupon or Coupons may be waived by the Company and the Trustee if there is
furnished to them such security or indemnity as they may require to save each of
them and any Paying Agent harmless. If thereafter the Holder of such Bearer
Security shall surrender to any Paying Agent any such missing Coupon in respect
of which such a payment shall have been made, such Holder shall be entitled to
receive the amount of such payment; PROVIDED, HOWEVER, that except as otherwise
provided in Section 12.03, interest represented by Coupons shall be payable only
upon presentation and surrender of those Coupons at an office or agency located
outside the United States. Notwithstanding the foregoing, in case a Bearer
Security of any series is surrendered at any such office or agency in exchange
for a Registered Security of the same series and of a like Stated Maturity and
with like terms and conditions after the close of business at such office or
agency on (i) any Regular Record Date and before the opening of business at such
office or agency on the relevant Interest Payment Date, or (ii) any Special
Record Date and before the opening of business at such office or agency on the
related proposed date for payment of Defaulted Interest, such Bearer Security
shall be surrendered without the Coupon relating to such Interest Payment Date
or proposed date for payment, as the case may be (or, if such Coupon is so
surrendered with such Bearer Security, such Coupon shall be returned to the
Person so surrendering the Bearer Security), and interest or Defaulted Interest,
as the case may be, will not be payable on such Interest Payment Date or
proposed date for payment, as the case may be, in respect of the Registered
Security issued in exchange for such Bearer Security, but will be payable only
to the Holder of such Coupon when due in accordance with the provisions of this
Indenture. The Company shall execute, and the Trustee shall authenticate and
deliver, the Registered Security or Securities which the Holder making the
exchange is entitled to receive.

(c) Except as otherwise specified pursuant to Section 3.01, in no
event may Registered Securities, including Registered Securities received in
exchange for Bearer Securities, be exchanged for Bearer Securities.

(d) All Debt Securities issued upon any transfer or exchange 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 transfer or exchange.

Every Registered Security presented or surrendered for transfer or
exchange shall (if so required by the Company or the Trustee) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Security Registrar, duly executed, by the Holder thereof or
his or her attorney duly authorized in writing.

No service charge will be made for any transfer or exchange of Debt
Securities except as PROVIDED in Section 3.04(b) or 3.06. The Company may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration, transfer or
exchange of Debt Securities, other than those expressly provided in this
Indenture to be made at the Company's own expense or without expense or without
charge to the Holders.

The Company shall not be required (i) to register, transfer or
exchange Debt Securities of any series during a period beginning at the opening
of business 15 days before the day of the transmission of a notice of redemption
of Debt Securities of such series selected for redemption under Section 13.03
and ending at the close of business on the day of such transmission, or (ii) to
register, transfer or exchange any Debt Security so selected for redemption in
whole or in part, except the unredeemed portion of any Debt Security being
redeemed in part.

27
<PAGE>

Section 3.06. MUTILATED, DESTROYED, LOST AND STOLEN DEBT SECURITIES.

If (i) any mutilated Debt Security or any mutilated Coupon with the
Coupon Security to which it appertains (and all unmatured Coupons attached
thereto) is surrendered to the Trustee at its Corporate Trust Office (in the
case of Registered Securities) or at its principal London office (in the case of
Bearer Securities), or (ii) the Company and the Trustee receive evidence to
their satisfaction of the destruction, loss or theft of any Debt Security or any
Coupon, and there is delivered to the Company and the Trustee such security or
indemnity as may be required by them to save each of them and any Paying Agent
harmless, and neither the Company nor the Trustee receives notice that such Debt
Security or Coupon has been acquired by a bona fide purchaser, then the Company
shall execute and upon Company Request the Trustee shall authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Debt Security or in exchange for the Coupon Security to which such
mutilated, destroyed, lost or stolen Coupon appertained, a new Debt Security of
the same series of like Stated Maturity and with like terms and conditions and
like principal amount, bearing a number not contemporaneously Outstanding, and,
in the case of a Coupon Security, with such Coupons attached thereto that
neither gain nor loss in interest shall result from such exchange or
substitution.

In case any such mutilated, destroyed, lost or stolen Debt Security or
Coupon has become or is about to become due and payable, the Company in its
discretion may, instead of issuing a new Debt Security, pay the amount due on
such Debt Security or Coupon in accordance with its terms; PROVIDED, HOWEVER,
that principal of (and premium, if any) and any interest on Bearer Securities
shall, except as otherwise provided in Section 12.03, be payable only at an
office or agency located outside the United States and, unless otherwise
specified as contemplated by Section 3.01 or except as otherwise provided in
this Section 3.06, any interest on Bearer Securities shall be payable only upon
presentation and surrender of the Coupons appertaining thereto.

Upon the issuance of any new Debt Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in respect thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.

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

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

Section 3.07. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.

(a) Interest on any Registered Security which is payable and is
punctually paid or duly PROVIDED for on any Interest Payment Date shall be paid
to the Person in whose name such Registered Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest notwithstanding the cancellation of such Registered Security
upon any transfer or exchange subsequent to the Regular Record Date. Unless
otherwise specified as contemplated by Section 3.01 with respect to the Debt
Securities of any series, payment of interest on Registered Securities shall be
made at the place or places specified pursuant to Section 3.01 or, at the

<PAGE>

option of the Company, by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register or, if provided
pursuant to Section 3.01, by wire transfer to an account designated by the
Registered Holder.

(b) Interest on any Coupon Security which is payable and is
punctually paid or duly PROVIDED for on any Interest Payment Date shall be paid
to the Holder of the Coupon which has matured on such Interest Payment Date upon
surrender of such Coupon on such Interest Payment Date at the principal London
office of the Trustee or at such other Place of Payment outside the United
States specified pursuant to Section 3.01.

Interest on any Bearer Security (other than a Coupon Security) which
is payable and is punctually paid or duly provided for on any Interest Payment
Date shall be paid to the Holder of the Bearer Security upon presentation of
such Bearer Security and notation thereon on such Interest Payment Date at the
principal London office of the Trustee or at such other Place of Payment outside
the United States specified pursuant to Section 3.01.

Unless otherwise specified pursuant to Section 3.01, at the direction
of the Holder of any Bearer Security or Coupon payable in Dollars, payment on
such Bearer Security or Coupon will be made by check drawn on a bank in the City
of New York or, if agreeable to the Trustee, by wire transfer to a Dollar
account maintained by such Holder outside the United States. If such payment at
the offices of all Paying Agents outside the United States becomes illegal or is
effectively precluded because of the imposition of exchange controls or similar
restrictions on the full payment or receipt of such amounts in Dollars, the
Company will appoint an office or agent in the United States at which such
payment may be made. Unless otherwise specified pursuant to Section 3.01, at
the direction of the Holder of any Bearer Security or Coupon payable in a
Foreign Currency, payment on such Bearer Security or Coupon will be made by a
check drawn on a bank outside the United States or by wire transfer to an
appropriate account maintained by such Holder outside the United States. Except
as provided in this paragraph, no payment on any Bearer Security or Coupon will
be made by mail to an address in the United States or by wire transfer to an
account in the United States.

(c) 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, if such Debt Security is a Registered Security,
forthwith cease to be payable to the Registered Holder on the relevant Regular
Record Date by virtue of his having been such Registered Holder, and such
Defaulted Interest may be paid by the Company, at its election in each case, as
provided in clause (1) or (2) below:

(1) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names such Registered Securities (or their
respective Predecessor Securities) are registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid
on each such Registered Security and the date of the proposed payment, and
at the same time the Company shall deposit with the Trustee an amount of
money in the Currency or Currency unit in which the Debt Securities of such
series are payable (except as otherwise specified pursuant to Sections 3.01
or 3.10) 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 date shall be not more than 15 days, and not less
than 10 days, prior to the date of the proposed payment and not less

<PAGE>

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 the
Holders of such Registered Securities at their addresses as they appear in
the Security Register, not less than 10 days prior to such Special Record
Date. Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been mailed as aforesaid, such
Defaulted Interest shall be paid to the Persons in whose names such
Registered Securities (or their respective Predecessor Securities) are
registered at the close of business on such Special Record Date and shall
no longer be payable pursuant to the following clause (2).

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

(d) Any Defaulted Interest payable in respect of Bearer Securities of
any series shall be payable pursuant to such procedures as may be satisfactory
to the Trustee in such manner that there is no discrimination between the
Holders of Registered Securities (if any) and Bearer Securities of such series,
and notice of the payment date therefor shall be given by the Trustee, in the
name and at the expense of the Company, in the manner provided in Section 1.05
not more than 25 days, and not less than 20 days, prior to the date of the
proposed payment.

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

Section 3.08. CANCELLATION.

Unless otherwise specified pursuant to Section 3.01 for Debt
Securities of any series, all Debt Securities surrendered for payment,
redemption, transfer, exchange or credit against any sinking fund and all
Coupons surrendered for payment or exchange shall, if surrendered to any Person
other than the Trustee, be delivered to the Trustee. All Registered Securities
and matured Coupons so delivered shall be promptly cancelled by the Trustee.
All Bearer Securities and unmatured Coupons so delivered shall be held by the
Trustee and, upon instruction by the Company Order, shall be cancelled or held
for reissuance. Bearer Securities and unmatured Coupons held for reissuance may
be reissued only in exchange for Bearer Securities of the same series and of
like Stated Maturity and with like terms and conditions pursuant to Section 3.05
or in replacement of mutilated, lost, stolen or destroyed Bearer Securities of
the same series and of like Stated Maturity and with like terms and conditions,
0or the related Coupons pursuant to Section 3.06. All Bearer Securities and
unmatured Coupons held by the Trustee pending such cancellation or reissuance
shall be deemed to be delivered for cancellation for all purposes of this
Indenture and the Debt Securities. The Company may at any time deliver to the
Trustee for cancellation any Debt Securities or Coupons previously authenticated
and delivered hereunder which the Company may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery
to the Trustee) for cancellation any Debt Securities previously authenticated
hereunder which the Company has not issued, and all Debt Securities or Coupons
so delivered shall be promptly cancelled by the Trustee. No Debt Securities or
Coupons shall be authenticated in lieu of or in exchange for any Debt Securities
or Coupons cancelled as provided in this Section, except as expressly permitted

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by this Indenture. All cancelled Debt Securities and Coupons held by the
Trustee shall be delivered to the Company upon Company Request. The acquisition
of any Debt Securities or Coupons by the Company shall not operate as a
redemption or satisfaction of the indebtedness represented thereby unless and
until such Debt Securities or Coupons are surrendered to the Trustee for
cancellation. In the case of any temporary Global Note which shall be destroyed
if the entire aggregate principal amount of the Debt Securities represented
thereby has been exchanged, the certificate of destruction shall state that all
certificates required pursuant to Section 3.04 hereof and substantially in the
form of Exhibit B hereto, to be given by the Euro-clear Operator or CEDEL, have
been duly presented to the Trustee by the Euro-clear Operator or CEDEL, as the
case may be. Permanent Global Notes shall not be destroyed until exchanged in
full for definitive Debt Securities or until payment thereon is made in full.

Section 3.09. COMPUTATION OF INTEREST.

Except as otherwise specified pursuant to Section 3.01 for Debt
Securities of any series, interest on the Debt Securities of each series shall
be computed on the basis of a 360-day year of twelve 30-day months.

Section 3.10. CURRENCY OF PAYMENTS IN RESPECT OF DEBT SECURITIES.

(a) Except as otherwise specified pursuant to Section 3.01 for Bearer
Securities of any series, payment of the principal of (and premium, if any) and
interest on Bearer Securities of such series denominated in any Currency will be
made in such Currency.

(b) With respect to Registered Securities of any series not
permitting the election provided for in paragraph (c) below or the Holders of
which have not made the election provided for in paragraph (c) below, except as
provided in paragraph (e) below, payment of the principal of (and premium, if
any) and any interest on any Registered Security of such series will be made in
the Currency in which such Registered Security is payable.

(c) It may be provided pursuant to Section 3.01 with respect to the
Registered Securities of any series that Holders shall have the option, subject
to paragraphs (e) and (f) below, to receive payments of principal of (and
premium, if any) and any interest on such Registered Securities in any of the
Currencies which may be designated for such election by delivering to the
Trustee a written election, to be in form and substance satisfactory to the
Trustee, not later than the close of business on the Election Date immediately
preceding the applicable payment date. If a Holder so elects to receive such
payments in any such Currency, such election will remain in effect for such
Holder or any transferee of such Holder until changed by such Holder or such
transferee by written notice to the Trustee (but any such change must be made
not later than the close of business on the Election Date immediately preceding
the next payment date to be effective for the payment to be made on such payment
date, and no such change or election may be made with respect to payments to be
made on any Registered Security of such series with respect to which an Event of
Default has occurred or notice of redemption has been given by the Company
pursuant to Article Thirteen). Any Holder of any such Registered Security who
shall not have delivered any such election to the Trustee by the close of
business on the applicable Election Date will be paid the amount due on the
applicable payment date in the relevant Currency as provided in paragraph (b) of
this Section 3.10.

(d) If the election referred to in paragraph (c) above has been
provided for pursuant to Section 3.01, then not later than the fourth Business
Day after the Election Date for each payment date, the Trustee will deliver to
the Company a written notice specifying, in the Currency in which each series of
the Registered Securities is payable, the respective aggregate amounts of
principal of (and premium,

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<PAGE>

if any) and any interest on the Registered Securities to be paid on such payment
date, specifying the amounts so payable in respect of the Registered Securities
as to which the Holders of Registered Securities denominated in any Currency
shall have elected to be paid in another Currency as provided in paragraph (c)
above. If the election referred to in paragraph (c) above has been provided for
pursuant to Section 3.01 and if at least one Holder has made such election,
then, on the second Business Day preceding each payment date, the Company will
deliver to the Trustee an Exchange Rate Officer's Certificate in respect of the
Currency payments to be made on such payment date. The Currency amount
receivable by Holders of Registered Securities who have elected payment in a
Currency as provided in paragraph (c) above shall be determined by the Company
on the basis of the applicable Market Exchange Rate in effect on the third
Business Day (the "Valuation Date") immediately preceding each payment date.

(e) If a Conversion Event occurs with respect to a Foreign Currency,
the ECU or any other Currency unit in which any of the Debt Securities are
denominated or payable, other than pursuant to an election provided for pursuant
to paragraph (c) above, then with respect to each date for the payment of
principal of (and premium, if any) and any interest on the applicable Debt
Securities denominated or payable in such Foreign Currency, the ECU or such
other Currency unit occurring after the last date on which such Foreign
Currency, the ECU or such other Currency unit was used (the "Conversion Date"),
the Dollar shall be the Currency of payment for use on each such payment date.
The Dollar amount to be paid by the Company to the Trustee and by the Trustee or
any Paying Agent to the Holders of such Debt Securities with respect to such
payment date shall be the Dollar Equivalent of the Foreign Currency or, in the
case of a Currency unit, the Dollar Equivalent of the Currency Unit, in each
case as determined by the Currency Determination Agent, if any, or, if there
shall not be a Currency Determination Agent, then by the Trustee, in the manner
provided in paragraph (g) or (h) below.

(f) If the Holder of a Registered Security denominated in any
Currency shall have elected to be paid in another Currency as provided in
paragraph (c) above, and a Conversion Event occurs with respect to such elected
Currency, such Holder shall receive payment in the Currency in which payment
would have been made in the absence of such election. If a Conversion Event
occurs with respect to the Currency in which payment would have been made in the
absence of such election, such Holder shall receive payment in Dollars as
provided in paragraph (e) of this Section 3.10.

(g) The "Dollar Equivalent of the Foreign Currency" shall be
determined by the Currency Determination Agent, if any, or, if there shall not
be a Currency Determination Agent, then by the Trustee, and shall be obtained
for each subsequent payment date by converting the specified Foreign Currency
into Dollars at the Market Exchange Rate on the Conversion Date.

(h) The "Dollar Equivalent of the Currency Unit" shall be determined
by the Currency Determination Agent, if any, or, if there shall not be a
Currency Determination Agent, then by the Trustee, and subject to the provisions
of paragraph (i) below, shall be the sum of each amount obtained by converting
the Specified Amount of each Component Currency into Dollars at the Market
Exchange Rate for such Component Currency on the Valuation Date with respect to
each payment.

(i) For purposes of this Section 3.10 the following terms shall have
the following meanings:

A "Component Currency" shall mean any Currency which, on the
Conversion Date, was a component Currency of the relevant Currency unit,
including, but not limited to, the ECU.

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A "Specified Amount" of a Component Currency shall mean the number of
units of such Component Currency or fractions thereof which were
represented in the relevant Currency unit, including, but not limited to,
the ECU, on the Conversion Date. If after the Conversion Date the official
unit of any Component Currency is altered by way of combination or
subdivision, the Specified Amount of such Component Currency shall be
divided or multiplied in the same proportion. If after the Conversion Date
two or more Component Currencies are consolidated into a single Currency,
the respective Specified Amounts of such Component Currencies shall be
replaced by an amount in such single Currency equal to the sum of the
respective Specified Amounts of such consolidated Component Currencies
expressed in such single Currency, and such amount shall thereafter be a
Specified Amount and such single Currency shall thereafter be a Component
Currency. If after the Conversion Date any Component Currency shall be
divided into two or more Currencies, the Specified Amount of such Component
Currency shall be replaced by amounts of such two or more Currencies with
appropriate Dollar equivalents at the Market Exchange Rate on the date of
such replacement equal to the Dollar equivalent of the Specified Amount of
such former Component Currency at the Market Exchange Rate on such date,
and such amounts shall thereafter be Specified Amounts and such Currencies
shall thereafter be Component Currencies. If after the Conversion Date of
the relevant Currency unit, including, but not limited to, the ECU, a
Conversion Event (other than any event referred to above in this definition
of "Specified Amount") occurs with respect to any Component Currency of
such Currency unit, the Specified Amount of such Component Currency shall,
for purposes of calculating the Dollar Equivalent of the Currency Unit, be
converted into Dollars at the Market Exchange Rate in effect on the
Conversion Date of such Component Currency.

"Election Date" shall mean the record date with respect to any payment
date, and with respect to the Maturity shall mean the record date (if
within 16 or fewer days prior to the Maturity) immediately preceding the
Maturity, and with respect to any series of Debt Securities whose record
date immediately preceding the Maturity is more than 16 days prior to the
Maturity or any series of Debt Securities for which no record dates are
provided with respect to interest payments, shall mean the date which is 16
days prior to the Maturity.

(j) All decisions and determinations of the Trustee or the Currency
Determination Agent, if any, regarding the Dollar Equivalent of the Foreign
Currency, the Dollar Equivalent of the Currency Unit and the Market Exchange
Rate shall be in its sole discretion and shall, in the absence of manifest
error, be conclusive for all purposes and irrevocably binding upon the Company
and all Holders of the Debt Securities denominated or payable in the relevant
Currency. In the event of a Conversion Event with respect to a Foreign
Currency, the Company, after learning thereof, will immediately give written
notice thereof to the Trustee (and the Trustee will promptly thereafter give
notice in the manner provided in Section 1.05 to the Holders) specifying the
Conversion Date. In the event of a Conversion Event with respect to the ECU or
any other Currency unit in which Debt Securities are denominated or payable, the
Company, after learning thereof, will immediately give notice thereof to the
Trustee (and the Trustee will promptly thereafter give written notice in the
manner provided in Section 1.05 to the Holders) specifying the Conversion Date
and the Specified Amount of each Component Currency on the Conversion Date. In
the event of any subsequent change in any Component Currency as set forth in the
definition of Specified Amount above, the Company, after learning thereof, will
similarly give written notice to the Trustee. The Trustee shall be fully
justified and protected in relying and acting upon information received by it
from the Company and the Currency Determination Agent, if any, and shall not
otherwise have any duty or obligation to determine such information
independently.

(k) For purposes of any provision of the Indenture where the Holders
of Outstanding Debt Securities may perform an Act which requires that a
specified percentage of the Outstanding Debt

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<PAGE>

Securities of all series perform such Act and for purposes of any decision or
determination by the Trustee of amounts due and unpaid for the principal (and
premium, if any) and interest on the Debt Securities of all series in respect of
which moneys are to be disbursed ratably, the principal of (and premium, if any)
and interest on the Outstanding Debt Securities denominated in a Foreign
Currency will be the amount in Dollars based upon the Market Exchange Rate for
Debt Securities of such series, as of the date for determining whether the
Holders entitled to perform such Act have performed it, or as of the date of
such decision or determination by the Trustee, as the case may be.

Section 3.11. JUDGMENTS.

If for the purpose of obtaining a judgment in any court with respect
to any obligation of the Company hereunder or under any Debt Security, it shall
become necessary to convert into any other Currency any amount in the Currency
due hereunder or under such Debt Security, then such conversion shall be made at
the Market Exchange Rate as in effect on the date the Company shall make payment
to any Person in satisfaction of such judgment. If pursuant to any such
judgment, conversion shall be made on a date other than the date payment is made
and there shall occur a change between such Market Exchange Rate and the Market
Exchange Rate as in effect on the date of payment, the Company agrees to pay
such additional amounts (if any) as may be necessary to ensure that the amount
paid is equal to the amount in such other Currency which, when converted at the
Market Exchange Rate as in effect on the date of payment or distribution, is the
amount then due hereunder or under such Debt Security. Any amount due from the
Company under this Section 3.11 shall be due as a separate debt and is not to be
affected by or merged into any judgment being obtained for any other sums due
hereunder or in respect of any Debt Security. In no event, however, shall the
Company be required to pay more in the Currency or Currency unit due hereunder
or under such Debt Security at the Market Exchange Rate as in effect when
payment is made than the amount of Currency stated to be due hereunder or under
such Debt Security so that in any event the Company's obligations hereunder or
under such Debt Security will be effectively maintained as obligations in such
Currency, and the Company shall be entitled to withhold (or be reimbursed for,
as the case may be) any excess of the amount actually realized upon any such
conversion over the amount due and payable on the date of payment or
distribution.

Section 3.12. EXCHANGE UPON DEFAULT.

If default is made in the payments referred to in Section 12.01, then
the Company hereby undertakes that, upon presentation and surrender of a
permanent Global Note to the Trustee (or to any other Person or at any other
address as the Company may designate in writing), on any Business Day on or
after the maturity date thereof, the Company will issue and the Trustee will
authenticate and deliver to the bearer of such permanent Global Note duly
executed and authenticated definitive Debt Securities with the same issue date
and maturity date as set out in such permanent Global Note.

Section 3.13. MANDATORY DISPOSITION OF DEBT SECURITIES PURSUANT TO
GAMING LAWS.

Each Holder and beneficial owner, by accepting or otherwise acquiring
an interest in the Debt Securities, shall be deemed to have agreed that if the
Gaming Authority of any jurisdiction in which the Company or any of its
subsidiaries conducts or proposes to conduct gaming requires that a Person who
is a Holder or beneficial owner must be licensed, qualified or found suitable
under the applicable Gaming Laws, such Holder or beneficial owner shall apply
for a license, qualification or a finding of suitability within the required
time period. If such Person fails to apply or become licensed or qualified or
is found unsuitable, then the Company shall have the right, at its option,
(i) to require such Person to dispose of its Debt Securities or beneficial
interest therein within 30 days of receipt of notice of the Company's election
or such earlier date as may be requested or prescribed by such Gaming Authority

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<PAGE>

or (ii) to redeem such Debt Securities at a redemption price equal to the lesser
of (a) such Person's cost or (b) 100% of the principal amount thereof, plus
accrued and unpaid interest to the earlier of the redemption date and the date
of the finding of unsuitability, which may be less than 30 days following the
notice of redemption if so requested or prescribed by the Gaming Authority. The
Company shall notify the Trustee in writing of any such redemption as soon as
practicable. The Company shall not be responsible for any costs or expenses any
such Holder or beneficial owner may incur in connection with its application for
a license, qualification or a finding of suitability.

ARTICLE FOUR

SATISFACTION AND DISCHARGE

Section 4.01. SATISFACTION AND DISCHARGE OF INDENTURE.

This Indenture shall, upon Company Request, cease to be of further
effect with respect to any series of Debt Securities specified in such Company
Request (except as to any surviving rights of registration of transfer or
exchange of such Debt Securities herein expressly provided for and rights to
receive payments of principal (and premium, if any) and interest on such Debt
Securities) and the Trustee, at the expense of the Company, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture, when:

(1) either

(A) all Debt Securities and the Coupons, if any, of such series
theretofore authenticated and delivered (other than (i) Debt Securities and
Coupons of such series which have been destroyed, lost or stolen and which
have been replaced or paid as provided in Section 3.06, (ii) Coupons
appertaining to Bearer Securities surrendered for exchange for Registered
Securities and maturing after such exchange, whose surrender is not
required or has been waived under Section 3.05, (iii) Coupons appertaining
to Bearer Securities called for redemption and maturing after the relevant
Redemption Date, whose surrender has been waived as provided in Section
13.06, and (iv) Debt Securities and Coupons of such series for whose
payment money has theretofore been deposited in trust or segregated and
held in trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 12.04) have been
delivered to the Trustee for cancellation; or

(B) all Debt Securities and the Coupons, if any, 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 by the Trustee in the name, and at the expense, of the
Company,

and the Company, either complies with any other condition or terms
specified pursuant to Section 3.01, or if not so specified in the case of
(i), (ii) or (iii) of this subclause (B), has irrevocably deposited or
caused to be deposited with the Trustee as trust funds in trust for such
purpose an

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<PAGE>

amount in the Currency in which such Debt Securities are denominated
(except as otherwise provided pursuant to Section 3.01 or 3.10) sufficient
to pay and discharge the entire indebtedness on such Debt Securities for
principal (and premium, if any) and interest to the date of such deposit
(in the case of Debt Securities which have become due and payable) or to
the Stated Maturity or Redemption Date, as the case may be; PROVIDED,
HOWEVER, in the event a petition for relief under the Federal bankruptcy
laws, as now or hereafter constituted, or any other applicable Federal or
state bankruptcy, insolvency or other similar law, is filed with respect to
the Company within 91 days after the deposit and the Trustee is required to
return the deposited money to the Company, the obligations of the Company
under this Indenture with respect to such Debt Securities shall not be
deemed terminated or discharged;

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

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

(4) the Company has delivered to the Trustee an Opinion of Counsel or
a ruling by the Internal Revenue Service to the effect that Holders of the
Debt Securities of the series will not recognize income, gain or loss for
Federal income tax purposes as a result of such deposit and discharge.

Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.07, the obligations of
the Trustee to any Authenticating Agent under Section 6.14, the obligations of
the Company under Section 12.01, and, if money shall have been deposited with
the Trustee pursuant to subclause (B) of clause (1) of this Section, the
obligations of the Trustee under Section 4.02 and the last paragraph of Section
12.04, shall survive. If, after the deposit referred to in Section 4.01 has
been made, (x) the Holder of a Debt Security is entitled to, and does, elect
pursuant to Section 3.10(c), to receive payment in a Currency other than that in
which the deposit pursuant to Section 4.01 was made, or (y) if a Conversion
Event occurs with respect to the Currency in which the deposit was made or
elected to be received by the Holder pursuant to Section 3.10(c), then the
indebtedness represented by such Debt Security shall be fully discharged to the
extent that the deposit made with respect to such Debt Security shall be
converted into the Currency in which such payment is made.

Section 4.02. APPLICATION OF TRUST MONEY.

Subject to the provisions of the last paragraph of Section 12.04, all
money deposited with the Trustee pursuant to Section 4.01 shall be held in trust
and applied by it, in accordance with the provisions of the Debt Securities and
Coupons, if any, 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 has been deposited
with the Trustee.

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ARTICLE FIVE

REMEDIES

Section 5.01. EVENTS OF DEFAULT.

"Event of Default" wherever used herein with respect to Debt
Securities of any series 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, pursuant to any judgment, decree
or order of any court or any order, rule or regulation of any administrative or
governmental body):

(1) default in the payment of any interest upon any Debt Security or
any payment with respect to the Coupons, if any, of such series when it
becomes due and payable, and continuance of such default for a period of 30
days; or

(2) default in the payment of the principal of (and premium, if any,
on) any Debt Security of such series at its Maturity; or

(3) default in the deposit of any sinking fund payment, when and as
due by the terms of a Debt Security of such series; or

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

(5) the acceleration of the maturity of any indebtedness of
the Company (other than Non-recourse Indebtedness), at any one time, in
an amount in excess of the greater of (i) $25 million and (ii) 5% of
Consolidated Net Tangible Assets, if such acceleration is not annulled
within 30 days after written notice to the Company by the Trustee and
the holders of at least 25% in principal amount of the outstanding Debt
Securities of that series;

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

(7) the commencement by the Company of a voluntary case under the
Federal bankruptcy laws, as now or hereafter constituted, or any other
applicable Federal or State bankruptcy, insolvency or other similar law, or
the consent by it to the entry of an order for relief in an involuntary
case under any such law or to the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or other similar official) of
the Company or of any substantial part of its property, or the making by it
of an assignment for the benefit of its creditors, or the admission by it
in writing of its inability to pay its debts generally as they

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become due, or the taking of corporate action by the Company in furtherance
of any such action; or

(8) any other Event of Default or variations in the foregoing Events
of Default PROVIDED with respect to Debt Securities of that series pursuant
to Section 3.01.

Section 5.02. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.

If an Event of Default with respect to Debt Securities of any series
at the time Outstanding occurs and is continuing, then in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Debt Securities of such series may declare the principal amount (or,
if any Debt Securities of such series are Discount Securities, such portion of
the principal amount of such Discount Securities as may be specified in the
terms of such Discount Securities) of all the Debt Securities of such series to
be due and payable immediately, by a notice in writing to the Company (and to
the Trustee if given by Holders), and upon any such declaration such principal
amount (or specified amount) plus accrued and unpaid interest (and premium, if
payable) shall become immediately due and payable. Upon payment of such amount
in the Currency in which such Debt Securities are denominated (except as
otherwise provided pursuant to Sections 3.01 or 3.10), all obligations of the
Company in respect of the payment of principal of the Debt Securities of such
series shall terminate.

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

(1) the Company has paid or deposited with the Trustee a sum in the
Currency in which such Debt Securities are denominated (except as otherwise
provided pursuant to Section 3.01 or 3.10) sufficient to pay

(A) all overdue installments of interest on all Debt Securities or
all overdue payments with respect to any Coupons of such series,

(B) the principal of (and premium, if any, on) any Debt Securities of
such series which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate or
rates prescribed therefor in such Debt Securities,

(C) to the extent that payment of such interest is lawful, interest
upon overdue installments of interest on each Debt Security of
such series or upon overdue payments on any Coupons of such
series at the Overdue Rate, and

(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel; PROVIDED, HOWEVER, that all
sums payable under this clause (D) shall be paid in Dollars;

and

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(2) All Events of Default with respect to Debt Securities of such
series, other than the nonpayment of the principal of Debt Securities of
such series which has become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 5.13.

No such rescission and waiver shall affect any subsequent default or impair any
right consequent thereon.

Section 5.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE.

The Company covenants that, if:

(1) default is made in the payment of any installment of interest on
any Debt Security or any payment with respect to any Coupons when such
interest or payment becomes due and payable and such default continues for
a period of 30 days,

(2) default is made in the payment of principal of (or premium, if
any, on) any Debt Security at the Maturity thereof, or

(3) default is made in the making or satisfaction of any sinking fund
payment or analogous obligation when the same becomes due pursuant to the
terms of the Debt Securities of any series,

then the Company will, upon demand of the Trustee, pay to it, for the benefit of
the Holders of such Debt Securities or of such Coupons, the amount then due and
payable on such Debt Securities or matured Coupons, for the principal (and
premium, if any) and interest, if any, and, to the extent that payment of such
interest shall be legally enforceable, interest upon the overdue principal (and
premium, if any) and upon overdue installments of interest, at the Overdue Rate;
and, in addition thereto, such further amount as shall be sufficient to cover
the costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.

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

If an Event of Default with respect to Debt Securities of any series
occurs and is continuing, then the Trustee may, in its discretion, proceed to
protect and enforce its rights and the rights of the Holders of Debt Securities
and Coupons 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.

Section 5.04. TRUSTEE MAY FILE PROOFS OF CLAIM.

In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceedings, or any voluntary or involuntary case under the Federal
bankruptcy laws, as now or hereafter constituted, relative to the Company or any
other obligor upon the Debt Securities and Coupons, if any, of a particular
series or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether

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

(i) to file and prove a claim for the whole amount of principal (or,
if the Debt Securities of such series are Discount Securities, such portion
of the principal amount as may be due and payable with respect to such
series pursuant to a declaration in accordance with Section 5.02) (and
premium, if any) and interest owing and unpaid in respect of the Debt
Securities and Coupons of such series and to file such other papers or
documents as may be necessary or advisable in order to have the claims of
the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and of
the Holders of such Debt Securities and Coupons allowed in such judicial
proceeding, and

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

and any receiver, assignee, trustee, custodian, liquidator, sequestrator (or
other similar official) in any such proceeding is hereby authorized by each such
Holder to make such payments to the Trustee, and in the event that the Trustee
shall consent to the making of such payments directly to such Holders, to pay to
the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 6.07.

Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Debt
Securities and any Coupons of such series or the rights of any Holder thereof,
or to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.

Section 5.05. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF DEBT
SECURITIES.

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

Section 5.06. APPLICATION OF MONEY COLLECTED.

Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal (and premium,
if any) or interest, upon presentation of the Debt Securities or Coupons of any
series in respect of which money has been collected and the notation thereon of
the payment if only partially paid and upon surrender thereof if fully paid:

FIRST: To the payment of all amounts due the Trustee under Section
6.07.

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<PAGE>

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

THIRD: The balance, if any, to the Person or Persons entitled thereto.

Section 5.07. LIMITATION ON SUITS.

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

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

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

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

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

(5) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of at least a
majority in principal amount of the Outstanding Debt Securities of such
series;

it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other such
Holders or of the Holders of Outstanding Debt Securities or Coupons of any other
series, or to obtain or to seek to obtain priority or preference over any other
of such Holders or to enforce any right under this Indenture, except in the
manner herein provided and for the equal and ratable benefit of all of such
Holders. For the protection and enforcement of the provisions of this Section
5.07, each and every Holder of Debt Securities or Coupons of any series and the
Trustee for such series shall be entitled to such relief as can be given at law
or in equity.

Section 5.08. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL,
PREMIUM AND INTEREST.

Notwithstanding any other provision in this Indenture, the Holder of
any Debt Security or of any Coupon shall have the right, which is absolute and
unconditional, to receive payment of the principal of (and premium, if any) and
(subject to Section 3.07) interest on such Debt Security or Coupon on the
respective Stated Maturity or Maturities expressed in such Debt Security or
Coupon (or, in the case of redemption, on the Redemption Date) and to institute
suit for the enforcement of any such payment and interest thereon, and such
right shall not be impaired without the consent of such Holder.

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Section 5.09. RESTORATION OF RIGHTS AND REMEDIES.

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

Section 5.10. RIGHTS AND REMEDIES CUMULATIVE.

Except as otherwise expressly provided elsewhere in this Indenture, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.

Section 5.11. DELAY OR OMISSION NOT WAIVER.

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

Section 5.12. CONTROL BY HOLDERS.

The Holders of at least a majority in 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, PROVIDED that:

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

(2) subject to the provisions of Section 6.01, the Trustee shall have
the right to decline to follow any such direction if the Trustee in good
faith shall, by a Responsible Officer or Responsible Officers of the
Trustee, determine that the proceeding so directed would be unjustly
prejudicial to the Holders of Debt Securities of such series not joining in
any such direction; and

(3) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.

Section 5.13. WAIVER OF PAST DEFAULTS.

The Holders of not less than a majority in aggregate principal amount
of the Outstanding Debt Securities of any series, by notice to the Trustee, may,
on behalf of the Holders of all the Debt Securities of any such series, waive
any past default hereunder with respect to such series and its consequences,
except a default:

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(1) in the payment of the principal of (or premium, if any) or
interest on any Debt Security of such series, or in the payment of any
sinking fund installment or analogous obligation with respect to the Debt
Securities of such series, or

(2) in respect of a covenant or provision hereof which, pursuant to
Article Eleven, cannot be modified or amended without the consent of the
Holder of each Outstanding Debt Security of such series affected.

Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured for every
purpose of the Debt Securities of such series under this Indenture, but no such
waiver shall extend to any subsequent or other default or impair any right
consequent thereon.

Section 5.14. UNDERTAKING FOR COSTS.

All parties to this Indenture agree, and each Holder of any Debt
Security or any Coupon by his acceptance thereof shall be deemed to have agreed,
that any court may in its discretion require, in any suit for the enforcement of
any right or remedy under this Indenture, or in any suit against the Trustee for
any action taken, suffered or omitted by it as Trustee, the filing by any party
litigant in such suit other than the Trustee of an undertaking to pay the costs
of such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant, but the provisions of this Section shall not apply to any
suit instituted by the Trustee, to any suit instituted by any Holder or group of
Holders holding in the aggregate more than 10% in principal amount of the
Outstanding Debt Securities of any series, or to any suit instituted by any
Holder of a Debt Security or Coupon for the enforcement of the payment of the
principal of (or premium, if any) or interest on such Debt Security or the
payment of any Coupon on or after the respective Stated Maturity or Maturities
expressed in such Debt Security or Coupon (or, in the case of redemption, on or
after the Redemption Date).

Section 5.15. WAIVER OF STAY OR EXTENSION LAWS.

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

ARTICLE SIX

THE TRUSTEE

Section 6.01. CERTAIN DUTIES AND RESPONSIBILITIES.

(a) Except during the continuance of an Event of Default with respect
to the Debt Securities of any series,

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

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

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

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

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

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

(3) the Trustee shall not be liable with respect to any action taken,
suffered or omitted to be taken by it with respect to Debt Securities of
any series in good faith in accordance with the direction of the Holders of
at least a majority in principal amount of the Outstanding Debt Securities
of such series relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred upon the Trustee, under this Indenture; and

(4) the Trustee shall not be required to expend or risk its own funds
or otherwise incur any financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured
to it.

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

Section 6.02. NOTICE OF DEFAULTS.

Within 90 days after the occurrence of any default hereunder with
respect to Debt Securities or Coupons, if any, of any series, the Trustee shall
give notice to all Holders of Debt Securities and Coupons of such series of such
default 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

<PAGE>

principal of (or premium, if any) or interest on any Debt Security or Coupon of
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 and/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 and of Coupons of such series; and PROVIDED,
FURTHER, that in the case of any default of the character specified in Section
5.01(4) with respect to Debt Securities of such series no such notice to Holders
shall be given until at least 30 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.

Notice given pursuant to this Section 6.02 shall be transmitted by
mail:

(1) to all Registered Holders, as the names and addresses of the
Registered Holders appear in the Security Register;

(2) to such Holders of Bearer Securities of any series as have within
two years preceding such transmission, filed their names and addresses with
the Trustee for such series for that purpose; and

(3) to each Holder of a Debt Security of any series whose name and
address appear in the information preserved at the time by the Trustee in
accordance with Section 7.02(a) of this Indenture.

Section 6.03. CERTAIN RIGHTS OF TRUSTEE.

Except as otherwise provided in Section 6.01:

(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, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party or
parties;

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

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

(d) 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, suffered or omitted by it hereunder
in good faith and in reliance thereon;

(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders of Debt Securities of any series pursuant to this Indenture,
unless such Holders shall have offered to the Trustee security or

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<PAGE>

indemnity reasonably satisfactory to it against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction;

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

(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 responsible for any misconduct or
negligence on the part of any agent (including any agent appointed pursuant to
Section 3.10(j)) or attorney appointed with due care by it hereunder.

Section 6.04. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF DEBT
SECURITIES.

The recitals contained herein and in the Debt Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Debt Securities or Coupons, if any, of any series. The
Trustee shall not be accountable for the use or application by the Company of
any Debt Securities or the proceeds thereof.

Section 6.05. MAY HOLD DEBT SECURITIES.

The Trustee, any Paying Agent, the Security Registrar or any other
agent of the Company, in its individual or any other capacity, may become the
owner or pledgee of Debt Securities or Coupons, and, subject to Sections 6.08
and 6.13, may otherwise deal with the Company with the same rights it would have
if it were not Trustee, Paying Agent, Security Registrar or such other agent.

Section 6.06. MONEY HELD IN TRUST.

Money in any Currency held by the Trustee or any Paying Agent in trust
hereunder 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 money received by it hereunder except as otherwise agreed
with the Company.

Section 6.07. COMPENSATION AND REIMBURSEMENT.

The Company agrees:

(1) to pay to the Trustee from time to time reasonable compensation
in Dollars for all services rendered by it hereunder (which compensation
shall not be limited by any provision of law in regard to the compensation
of a trustee of an express trust);

(2) except as otherwise expressly provided herein, to reimburse the
Trustee in Dollars upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance
with any provision of this Indenture (including the reasonable compensation
and the reasonable expenses and disbursements of its agents and counsel),
except

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<PAGE>

any such expense, disbursement or advance as may be attributable to its
negligence or bad faith; and

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

As security for the performance of the obligations of the Company
under this Section, the Trustee shall have a claim prior to the Debt Securities
and Coupons, if any, upon all property and funds held or collected by the
Trustee as such, except funds held in trust for the payment of amounts due on
the Debt Securities and Coupons.

The obligations of the Company under this Section 6.07 to compensate
and indemnify the Trustee for reasonable expenses, disbursements and advances
shall constitute additional indebtedness under this Indenture and shall survive
the satisfaction and discharge of this Indenture.

Section 6.08. DISQUALIFICATION; CONFLICTING INTERESTS.

(a) If the Trustee has or shall acquire any conflicting interest, as
defined in this Section with respect to the Debt Securities of any series, then,
within 90 days after ascertaining that it has such conflicting interest, and if
the default (as hereinafter defined) to which such conflicting interest relates
has not been cured or duly waived or otherwise eliminated before the end of such
90-day period, the Trustee shall either eliminate such conflicting interest or,
except as otherwise provided below, resign with respect to the Debt Securities
of such series, and the Company shall take prompt steps to have a successor
appointed, in the manner and with the effect hereinafter specified in this
Article.

(b) In the event that the Trustee shall fail to comply with the
provisions of subsection (a) of this Section with respect to the Debt Securities
of any series, the Trustee shall, within 10 days after the expiration of such
90-day period, transmit to all Holders of Debt Securities of such series notice
of such failure.

Notice given pursuant to this Section 6.08(b) shall be transmitted by
mail:

(1) to all Registered Holders, as the names and addresses of the
Registered Holders appear in the Security Register;

(2) to such Holders of Bearer Securities of any series as have,
within two years preceding such transmission, filed their names and
addresses with the Trustee for such series for that purpose; and

(3) to each Holder of a Debt Security of any series whose name and
address appear in the information preserved at the time by the Trustee in
accordance with Section 7.02(a) of this Indenture.

(c) For the purposes of this Section, the Trustee shall be deemed to
have a conflicting interest with respect to the Debt Securities of any series,
if there shall exist an Event of Default (as such term is defined herein, but
exclusive of any period of grace or requirement of notice) with respect to such
Debt Securities and

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(1) the Trustee is trustee under this Indenture with respect to the
Outstanding Debt Securities of any series other than that series or is
trustee under another indenture under which any other securities, or
certificates of interest or participation in any other securities, of the
Company are outstanding, unless such other indenture is a collateral trust
indenture under which the only collateral consists of Debt Securities
issued under this Indenture, PROVIDED that there shall be excluded from the
operation of this paragraph this Indenture with respect to the Debt
Securities of any series other than that series and any other indenture or
indentures under which other securities, or certificates of interest or
participation in other securities, of the Company are outstanding, if

(i) this Indenture and such other indenture or indentures (and
all series of securities issuable thereunder) are wholly unsecured and
rank equally and such other indenture or indentures are hereafter
qualified under the Trust Indenture Act, unless the Commission shall
have found and declared by order pursuant to Section 305(b) or Section
307(c) of the Trust Indenture Act that differences exist between the
provisions of this Indenture with respect to the Debt Securities of
such series and one or more other series or the provisions of such
other indenture or indentures which are so likely to involve a
material conflict of interest as to make it necessary, in the public
interest or for the protection of investors, to disqualify the Trustee
from acting as such under this Indenture with respect to the Debt
Securities of such series and such other series or under such other
indenture or indentures, or

(ii) the Company shall have sustained the burden of proving, on
application to the Commission and after opportunity for hearing
thereon, that trusteeship under this Indenture with respect to the
Debt Securities of such series and such other series or such other
indenture or indentures is not so likely to involve a material
conflict of interest as to make it necessary in the public interest or
for the protection of investors to disqualify the Trustee from acting
as such under this Indenture with respect to the Debt Securities of
such series and such other series or under such other indenture or
indentures;

(2) the Trustee or any of its directors or executive officers is an
underwriter for the Company;

(3) the Trustee directly or indirectly controls or is directly or
indirectly controlled by or is under direct or indirect common control with
an underwriter for the Company;

(4) the Trustee or any of its directors or executive officers is a
director, officer, partner, employee, appointee or representative of the
Company, or of an underwriter (other than the Trustee itself) for the
Company who is currently engaged in the business of underwriting, except
that (i) one individual may be a director or an executive officer, or both,
of the Trustee and a director or an executive officer, or both, of the
Company but may not be at the same time an executive officer of both the
Trustee and the Company; (ii) if and so long as the number of directors of
the Trustee in office is more than nine, one additional individual may be a
director or an executive officer, or both, of the Trustee and a director of
the Company; and (iii) the Trustee may be designated by the Company or by
any underwriter for the Company to act in the capacity of transfer agent,
registrar, custodian, paying agent, fiscal agent, escrow agent, or
depositary or in any other similar capacity, or, subject to the provisions
of paragraph (l) of this subsection, to act as trustee, whether under an
indenture or otherwise;

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(5) 10% or more of the voting securities of the Trustee is
beneficially owned either by the Company or by any director, partner or
executive officer thereof, or 20% or more of such voting securities is
beneficially owned, collectively, by any two or more of such Persons; or
10% or more of the voting securities of the Trustee is beneficially owned
either by an underwriter for the Company or by any director, partner or
executive officer thereof or is beneficially owned, collectively, by any
two or more such persons;

(6) the Trustee is the beneficial owner of, or holds as collateral
security for an obligation which is in default (as hereinafter in this
subsection defined), (i) 5% or more of the voting securities, or 10% or
more of any other class of security, of the Company not including the Debt
Securities issued under this Indenture and securities issued under any
other indenture under which the Trustee is also trustee, or (ii) 10% or
more of any class of security of an underwriter for the Company;

(7) the Trustee is the beneficial owner of or holds as collateral
security for an obligation which is in default, 5% or more of the voting
securities of any Person who, to the knowledge of the Trustee, owns 10% or
more of the voting securities of, or controls directly or indirectly or is
under direct or indirect common control with, the Company;

(8) the Trustee is the beneficial owner of or holds as collateral
security for an obligation which is in default, 10% or more of any class of
security of any Person who, to the knowledge of the Trustee, owns 50% or
more of the voting securities of the Company;

(9) the Trustee owns, on the date of such Event of Default or any
anniversary of such Event of Default while such Event of Default remains
outstanding, in the capacity of executor, administrator, testamentary or
inter vivos trustee, guardian, committee or conservator, or in any other
similar capacity, an aggregate of 25% or more of the voting securities, or
of any class of security, of any Person, the beneficial ownership of a
specified percentage of which would have constituted a conflicting interest
under paragraph (6), (7) or (8) of this subsection. As to any such
securities of which the Trustee acquired ownership through becoming
executor, administrator or testamentary trustee of an estate which included
them, the provisions of the preceding sentence shall not apply, for a
period of not more than two years from the date of such acquisition, to the
extent that such securities included in such estate do not exceed 25% of
such voting securities or 25% of any such class of security. Promptly
after the dates of any such Event of Default and annually in each
succeeding year that such Event of Default continues, the Trustee shall
make a check of its holdings of such securities in any of the
above-mentioned capacities as of such dates. If the Company fails to make
payment in full of the principal of (or premium, if any) or interest on any
of the Debt Securities when and as the same becomes due and payable, and
such failure continues for 30 days thereafter, the Trustee shall make a
prompt check of its holdings of such securities in any of the
above-mentioned capacities as of the date of the expiration of such 30-day
period, and after such date, notwithstanding the foregoing provisions of
this paragraph, all such securities so held by the Trustee, with sole or
joint control over such securities vested in it, shall be considered as
though beneficially owned by the Trustee for the purposes of paragraphs
(6), (7) and (8) of this subsection; or

(10) except under the circumstances described in paragraphs (1), (3),
(4), (5) or (6) of Section 6.13(b) of this Indenture, the Trustee shall be
or shall become a creditor of the Company.

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For the purposes of paragraph (1) of this subsection, the term "series
of securities" or "series" means a series, class or group of securities issuable
under an indenture pursuant to whose terms holders of one such series may vote
to direct the Trustee, or otherwise take action pursuant to a vote of such
holders, separately from holders of another series; PROVIDED, that "series of
securities" or "series" shall not include any series of securities issuable
under an indenture if all such series rank equally and are wholly unsecured.

The specification of percentages in paragraphs (5) to (9), inclusive,
of this subsection shall not be construed as indicating that the ownership of
such percentages of the securities of a person is or is not necessary or
sufficient to constitute direct or indirect control for the purposes of
paragraph (3) or (7) of this subsection.

For the purposes of paragraphs (6), (7), (8) and (9) of this
subsection only, (i) the terms "security" and "securities" shall include only
such securities as are generally known as corporate securities, but shall not
include any note or other evidence of indebtedness issued to evidence an
obligation to repay moneys lent to a person by one or more banks, trust
companies or banking firms, or any certificate of interest or participation in
any such note or evidence of indebtedness; (ii) an obligation shall be deemed to
be "in default" when a default in payment of principal shall have continued for
30 days or more and shall not have been cured; and (iii) the Trustee shall not
be deemed to be the owner or holder of (A) any security which it holds as
collateral security, as trustee or otherwise, for an obligation which is not in
default as defined in clause (ii) above, or (B) any security which it holds as
collateral security under this Indenture, irrespective of any default hereunder,
or (C) any security which it holds as agent for collection, or as custodian,
escrow agent or depositary, or in any similar representative capacity.

(d) For the purposes of this Section:

(1) The term "underwriter" when used with reference to the Company
means every Person who, within one year prior to the time as of which the
determination is made, has purchased from the Company with a view to, or
has offered or sold for the Company in connection with, the distribution of
any security of the Company outstanding at such time, or has participated
or has had a direct or indirect participation in any such undertaking, or
has participated or has had a participation in the direct or indirect
underwriting of any such undertaking, but such term shall not include a
Person whose interest was limited to a commission from an underwriter or
dealer not in excess of the usual and customary distributors' or sellers'
commission.

(2) The term "director" means any director of a corporation, or any
individual performing similar functions with respect to any organization
whether incorporated or unincorporated.

(3) The term "trust" shall include only a trust where the interest or
interests of the beneficiary or beneficiaries are evidenced by a security.

(4) The term "voting security" means any security presently entitling
the owner or holder thereof to vote in the direction or management of the
affairs of a person, or any security issued under or pursuant to any trust,
agreement or arrangements whereby a trustee or trustees or agent or agents
for the owner or holder of such security are presently entitled to vote in
the direction or management of the affairs of a person.

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(5) The term "Company" means any obligor upon the Debt Securities of
any series.

(6) The term "executive officer" means the president, every vice
president (or, with respect to the Company, every executive or senior vice
president), every trust officer, the cashier, the secretary, and the
treasurer of a corporation, and any individual customarily performing
similar functions with respect to any organization, whether incorporated or
unincorporated, but shall not include the chairman of the board of
directors.

(e) The percentages of voting securities and other securities
specified in this Section shall be calculated in accordance with the following
provisions:

(1) A specified percentage of the voting securities of the Trustee,
the Company or any other Person referred to in this Section means such
amount of the outstanding voting securities of such Person as entitles the
holder or holders thereof to cast such specified Percentage of the
aggregate votes which the holders of all the outstanding voting securities
of such Person are entitled to cast in the direction or management of the
affairs of such Person.

(2) A specified percentage of a class of securities of a Person means
such percentage of the aggregate amount of securities of the class
outstanding.

(3) The term "amount", when used with regard to securities means the
principal amount if relating to evidences of indebtedness, the number of
shares if relating to capital shares, and the number of units if relating
to any other kind of security.

(4) The term "outstanding" means issued and not held by or for the
account of the issuer. The following securities shall not be deemed
outstanding within the meaning of this definition:

(i) securities of an issuer held in a sinking fund relating to
securities of the issuer of the same class;

(ii) securities of an issuer held in a sinking fund relating to
another class of securities of the issuer, if the obligation evidenced
by such other class of securities is not in default as to principal or
interest or otherwise;

(iii) securities pledged by the issuer thereof as security
for an obligation of the issuer not in default as to principal or
interest or otherwise; and

(iv) securities held in escrow if placed in escrow by the issuer
thereof;

PROVIDED, HOWEVER, that any voting securities of an issuer shall be deemed
outstanding if any Person other than the issuer is entitled to exercise the
voting rights thereof.

(5) A security shall be deemed to be of the same class as another
security if both securities confer upon the holder or holders thereof
substantially the same rights and privileges; PROVIDED, HOWEVER, that, in
the case of secured evidences of indebtedness, all of which are issued
under a single indenture, differences in the interest rates or maturity
dates of various series thereof shall not be deemed sufficient to
constitute such series as different classes; and PROVIDED, FURTHER, that,
in the case of unsecured evidences of indebtedness, differences in the
interest rates

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or maturity dates thereof shall not be deemed sufficient to constitute them
securities of different classes, whether or not they are issued under a
single indenture.

(f) Except in the case of a default in the payment of the principal
of or interest on any Debt Security of any series, or in the payment of any
sinking or purchase fund installment, the Trustee shall not be required to
resign as provided by this Section if the Trustee shall have sustained the
burden of proving, on application to the Commission and after opportunity for
hearing thereon, that:

(1) the Event of Default may be cured or waived during a reasonable
period and under the procedures described in such application; and

(2) a stay of the Trustee's duty to resign will not be inconsistent
with the interests of Holders of the Debt Securities.

The filing of such an application shall automatically stay the performance of
the duty to resign until the Commission orders otherwise.

Section 6.09. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.

There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having a combined capital and surplus
of at least $50,000,000, subject to supervision or examination by Federal, State
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, 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. Neither the Company nor any person directly or
indirectly controlling, controlled by, or under common control with the Company
shall serve as Trustee upon any Debt Securities.

Section 6.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.

(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.11.

(b) The Trustee may resign at any time with respect to the Debt
Securities of one or more series by giving written notice thereof to the
Company. If an instrument of acceptance by a successor Trustee shall not have
been delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the Debt
Securities of such series.

(c) The Trustee may be removed at any time with respect to the Debt
Securities of any series and a successor Trustee appointed by Act of the Holders
of at least a majority in principal amount of the Outstanding Debt Securities of
such series, delivered to the Trustee and to the Company.

(d) If at any time:

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(1) the Trustee shall fail to comply with Section 6.08(a) with
respect to the Debt Securities of any series after written request therefor
by the Company or by any Holder who has been a bona fide Holder of a Debt
Security of such series for at least six months, or

(2) the Trustee shall cease to be eligible under Section 6.09 with
respect to the Debt Securities of any series and shall fail to resign after
written request therefor by the Company or by any such Holder, or

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

then, in any such case, (i) the Company, by a Board Resolution, may remove the
Trustee with respect to all Debt Securities, or (ii) subject to Section 5.14,
any Holder who has been a bona fide Holder of a Debt Security of any 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 for the Debt Securities of such series.

(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, with
respect to the Debt Securities of one or more series, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee or Trustees with respect
to the Debt Securities of that or those series (it being understood that any
such successor Trustee may be appointed with respect to the Debt Securities of
one or more or all of such series and that at any time there shall be only one
Trustee with respect to the Debt Securities of any particular series) and shall
comply with the applicable requirements of Section 6.11. If, within one year
after such resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee with respect to the Debt Securities of any series
shall be appointed by Act of the Holders of at least a majority in principal
amount of the Outstanding Debt Securities of such series delivered to the
Company and the retiring Trustee, the successor Trustee so appointed shall,
forthwith upon its acceptance of such appointment, become the successor Trustee
with respect to the Debt Securities of such series and, to that extent,
supersede the successor Trustee appointed by the Company. If no successor
Trustee with respect to the Debt Securities of any series shall have been so
appointed by the Company or the Holders of such series and accepted appointment
in the manner hereinafter PROVIDED, any Holder who has been a bona fide Holder
of a Debt Security of such series for at least six months may, subject to
Section 5.14, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Debt Securities of such series.

(f) The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Debt Securities of any series and
each appointment of a successor Trustee with respect to the Debt Securities of
any series in the manner and to the extent provided in Section 1.05 to the
Holders of Debt Securities of such series. Each notice shall include the name
of the successor Trustee with respect to the Debt Securities of such series and
the address of its Corporate Trust Office.

Section 6.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.

(a) In the case of an appointment hereunder of a successor Trustee
with respect to all Debt Securities, each such successor Trustee so appointed
shall execute, acknowledge and deliver to the Company and to the retiring
Trustee an instrument accepting such appointment, and thereupon the resignation
or removal of the retiring Trustee shall become effective and such successor
Trustee, without

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any further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee, but, on request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee, and shall
duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee hereunder, subject nevertheless to its
claim, if any, provided for in Section 6.07.

(b) In case of 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 one or more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such appointment
and which (1) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, each successor Trustee all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Debt Securities of that or those series to which the appointment of such
successor Trustee relates, (2) if the retiring Trustee is not retiring with
respect to all Debt Securities, 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 that or those
series as to which the retiring Trustee is not retiring shall continue to be
vested in the retiring Trustee, and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in any 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 other trust or trusts hereunder administered by any other such Trustee; and,
upon the execution and delivery of any such supplemental indenture, the
resignation or removal of the retiring Trustee shall become effective to the
extent provided therein and each such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the retiring Trustee with respect to the Debt Securities of that
or those series to which the appointment of such successor Trustee relates, but,
on request of the Company or any successor Trustee, such retiring Trustee shall
duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee hereunder with respect to the Debt
Securities of that or those series to which the appointment of such successor
Trustee relates.

(c) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to in paragraph (a) or (b) of this Section, as the case may be.

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

Section 6.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS.

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

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Securities. In case any Debt Securities shall not have been authenticated by
such predecessor Trustee, any such successor Trustee may authenticate and
deliver such Debt Securities, in either its own name or that of its predecessor
Trustee, with the full force and effect which this Indenture provides for the
certificate of authentication of the Trustee.

Section 6.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.

(a) Subject to subsection (b) of this Section, if the Trustee shall
be or shall become a creditor, directly or indirectly, secured or unsecured, of
the Company within three months prior to a default, as defined in subsection (c)
of this Section, or subsequent to such default, then, unless and until such
default shall be cured, the Trustee shall set apart and hold in a special
account for the benefit of the Trustee individually, the Holders of the Debt
Securities and of the Coupons, if any, and the holders of other indenture
securities (as defined in subsection (c) of this Section):

(1) an amount equal to any and all reductions in the amount due and
owing upon any claim as such creditor in respect of principal or interest,
effected after the beginning of such three-month period and valid as
against the Company and its other creditors, except any such reduction
resulting from the receipt or disposition of any property described in
paragraph (2) of this subsection, or from the exercise of any right of
set-off which the Trustee could have exercised if a voluntary or
involuntary case had been commenced in respect of the Company under the
Federal bankruptcy laws, as now or hereafter constituted, or any other
applicable Federal or State bankruptcy, insolvency or other similar law
upon the date of such default; and

(2) all property received by the Trustee in respect of any claim as
such creditor, either as security therefor, or in satisfaction or
composition thereof, or otherwise, after the beginning of such three-month
period, or an amount equal to the proceeds of any such property, if
disposed of, SUBJECT, HOWEVER, to the rights, if any, of the Company and
its other creditors in such property or such proceeds.

Nothing herein contained, however, shall affect the right of the Trustee:

(A) to retain for its own account (i) payments made on account of any
such claim by any Person (other than the Company) who is liable thereon,
and (ii) the proceeds of the bona fide sale of any such claim by the
Trustee to a third Person, and (iii) distributions made in cash, securities
or other property in respect of claims filed against the Company in
bankruptcy or receivership or in proceedings or reorganization pursuant to
the Federal bankruptcy laws, as now or hereafter constituted, or any other
applicable Federal or State bankruptcy, insolvency or other similar law;

(B) to realize, for its own account, upon any property held by it as
security for any such claim, if such property was so held prior to the
beginning of such three-month period;

(C) to realize, for its own account, but only to the extent of the
claim hereinafter mentioned, upon any property held by it as security for
any such claim, if such claim was created after the beginning of such
three-month period and such property was received as security therefor
simultaneously with the creation thereof, and if the Trustee shall sustain
the burden of proving that at the time such property was so received the
Trustee had no reasonable cause to believe that a default, as defined in
subsection (c) of this Section, would occur within three months, or

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(D) to receive payment on any claim referred to in paragraph (B) or
(C) against the release of any property held as security for such claim as
provided in paragraph (B) or (C), as the case may be, to the extent of the
fair value of such property.

For the purposes of paragraphs (B), (C) and (D), property substituted
after the beginning of such three-month period for property held as security at
the time of such substitution shall, to the extent of the fair value of the
property released, have the same status as the property released, and, to the
extent that any claim referred to in any of such paragraphs is created in
renewal of or in substitution for or for the purpose of repaying or refunding
any pre-existing claim of the Trustee as such creditor, such claim shall have
the same status as such pre-existing claim.

If the Trustee shall be required to account, the funds and property
held in such special account and the proceeds thereof shall be apportioned among
the Trustee, the Holders and the holders of other indenture securities in such
manner that the Trustee, the Holders and the holders of other indenture
securities realize, as a result of payments from such special account and
payments of dividends on claims filed against the Company in bankruptcy or
receivership or in proceedings for reorganization pursuant to the Federal
bankruptcy laws, as now or hereafter constituted, or any other applicable
Federal or State bankruptcy, insolvency or other similar law, the same
percentage of their respective claims, figured before crediting to the claim of
the Trustee anything on account of the receipt by it from the Company of the
funds and property in such special account and before crediting to the
respective claims of the Trustee and the Holders and the holders of other
indenture securities dividends on claims filed against the Company in bankruptcy
or receivership or in proceedings for reorganization pursuant to the Federal
bankruptcy laws, as now or hereafter constituted, or any other applicable
Federal or State bankruptcy, insolvency or other similar law, but after
crediting thereon receipts on account of the indebtedness represented by their
respective claims from all sources other than from such dividends and from the
funds and property so held in such special account. As used in this paragraph,
with respect to any claim, the term "dividends" shall include any distribution
with respect to such claim, in bankruptcy or receivership or proceedings for
reorganization pursuant to the Federal bankruptcy laws, as now or hereafter
constituted, or any other applicable Federal or State bankruptcy, insolvency or
other similar law, whether such distribution is made in cash, securities, or
other property, but shall not include any such distribution with respect to the
secured portion, if any, of such claim. The court in which such bankruptcy,
receivership or proceedings for reorganization is pending shall have
jurisdiction (i) to apportion among the Trustee and the Holders and the holders
of other indenture securities, in accordance with the provisions of this
paragraph, the funds and property held in such special account and proceeds
thereof, or (ii) in lieu of such apportionment, in whole or in part, to give to
the provisions of this paragraph due consideration in determining the fairness
of the distributions to be made to the Trustee and the Holders and the holders
of other indenture securities with respect to their respective claims, in which
event it shall not be necessary to liquidate or to appraise the value of any
securities or other property held in such special account or as security for any
such claim, or to make a specific allocation of such distributions as between
the secured and unsecured portions of such claim, or otherwise to apply the
provisions of this paragraph as a mathematical formula.

Any Trustee which has resigned or been removed after the beginning of
such three-month period shall be subject to the provisions of this subsection as
though such resignation or removal had not occurred. If any Trustee has
resigned or been removed prior to the beginning of such three-month period, it
shall be subject to the provisions of this subsection if and only if the
following conditions exist:

(i) the receipt of property or reduction of claim, which would have
given rise to the obligation to account, if such Trustee had continued as
Trustee, occurred after the beginning of such three-month period; and

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(ii) such receipt of property or reduction of claim occurred within
three months after such resignation or removal.

(b) There shall be excluded from the operation of subsection (a) of
this Section a creditor relationship arising from:

(1) the ownership or acquisition of securities issued under any
indenture, or any security or securities having a maturity of one year or
more at the time of acquisition by the Trustee;

(2) advances authorized by a receivership or bankruptcy court of
competent jurisdiction or by this Indenture, for the purpose of preserving
any property which shall at any time be subject to the lien of this
Indenture or of discharging tax liens or other prior liens or encumbrances
thereon, if notice of such advances and of the circumstances surrounding
the making thereof is given to the Holders at the time and in the manner
provided in this Indenture;

(3) disbursements made in the ordinary course of business in the
capacity of trustee under an indenture, transfer agent, registrar,
custodian, paying agent, fiscal agent or depositary, or other similar
capacity;

(4) an indebtedness created as a result of services rendered or
premises rented, or an indebtedness created as a result of goods or
securities sold in a cash transaction as defined in subsection (c) of this
Section;

(5) the ownership of stock or of other securities of a corporation
organized under the provisions of Section 25(a) of the Federal Reserve Act,
as amended, which is directly or indirectly a creditor of the Company; and

(6) the acquisition, ownership, acceptance or negotiation of any
drafts, bills of exchange, acceptances or obligations which fall within the
classification of self-liquidating paper as defined in subsection (c) of
this Section.

(1) The term "default" means any failure to make payment in full of
the principal of or interest on any of the Debt Securities or upon the
other indenture securities when and as such principal or interest becomes
due and payable.

(2) The term "other indenture securities" means securities upon which
the Company is an obligor outstanding under any other indenture (i) under
which the Trustee is also trustee, (ii) which contains provisions
substantially similar to the provisions of this Section, and (iii) under
which a default exists at the time of the apportionment of the funds and
property held in such special account.

(3) The term "cash transaction" means any transaction in which full
payment for goods or securities sold is made within seven days after
delivery of the goods or securities in currency or in checks or other
orders drawn upon banks and payable upon demand.

(4) The term "self-liquidating paper" means any draft, bill of
exchange, acceptance or obligation which is made, drawn, negotiated or
incurred by the Company for the purpose of

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financing the purchase, processing, manufacturing, shipment, storage or
sale of goods, wares or merchandise and which is secured by documents
evidencing title to, possession of, or a lien upon, the goods, wares or
merchandise or the receivables or proceeds arising from the sale of the
goods, wares or merchandise previously constituting the security, provided
the security is received by the Trustee simultaneously with the creation of
the creditor relationship with the Company arising from the making,
drawing, negotiating or incurring of the draft, bill of exchange,
acceptance or obligation.

(5) The term "Company" means any obligor upon the Debt Securities.

Section 6.14. APPOINTMENT OF AUTHENTICATING AGENT.

As long as any Debt Securities of a series remain Outstanding, upon a
Company Request, there shall be an authenticating agent (the "Authenticating
Agent") appointed, for such period as the Company shall elect, by the Trustee
for such series of Debt Securities to act as its agent on its behalf and subject
to its direction in connection with the authentication and delivery of each
series of Debt Securities for which it is serving as Trustee. Debt Securities
of each such series authenticated by such Authenticating Agent shall be entitled
to the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by such Trustee. Wherever reference is made in
this Indenture to the authentication and delivery of Debt Securities of any
series by the Trustee for such series or to the Trustee's certificate of
authentication, such reference shall be deemed to include authentication and
delivery on behalf of the Trustee for such series by an Authenticating Agent for
such series and a certificate of authentication executed on behalf of such
Trustee by such Authenticating Agent, except that only the Trustee may
authenticate Debt Securities upon original issuance and pursuant to Section 3.06
hereof. 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, authorized under such laws to exercise corporate trust powers, having a
combined capital and surplus of at least $50,000,000 and subject to supervision
or examination by Federal or State authority. If such Authenticating Agent
publishes reports of condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then for purposes of
this Section, the combined capital and surplus of such Authenticating Agent
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,
such Authenticating Agent shall resign immediately in the manner and with the
effect specified in this Section.

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, conversion or consolidation to which any Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency business
of any Authenticating Agent, shall continue to be the Authenticating Agent with
respect to all series of Debt Securities for which it served as Authenticating
Agent without the execution or filing of any paper or any further act on the
part of the Trustee for such series or such Authenticating Agent. Any
Authenticating Agent may at any time, and if it shall cease to be eligible
shall, resign by giving written notice of resignation to the applicable Trustee
and to the Company.

Upon receiving such a notice of resignation or upon such a
termination, or in case at any time any Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section 6.14 with respect to
one or more or all series of Debt Securities, the Trustee for such series shall,
upon Company Request, appoint a successor Authenticating Agent, and the Company
shall provide notice of such appointment to all Holders of Debt Securities of
such series in the manner and to the extent provided in Section 1.05. Any
successor Authenticating Agent, upon acceptance of its appointment hereunder,

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shall become vested with all rights, powers, duties and responsibilities of its
predecessor hereunder, with like effect as if originally named as Authenticating
Agent herein. The Trustee for the Debt Securities of such series agrees to pay
to the Authenticating Agent for such series from time to time reasonable
compensation for its services, and the Trustee shall be entitled to be
reimbursed for such payment, subject to the provisions of Section 6.07. The
Authenticating Agent for the Debt Securities of any series shall have no
responsibility or liability for any action taken by it as such at the direction
of the Trustee for such series, except arising out of its negligence or willful
misconduct.

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

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

[NAME OF TRUSTEE]
As Trustee

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

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

ARTICLE SEVEN

HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY

Section 7.01. COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF
HOLDERS.

The Company will furnish or cause to be furnished to the Trustee with
respect to Registered Securities of each series for which it acts as Trustee:

(a) semi-annually on a date not more than 15 days after each Regular
Record Date with respect to an Interest Payment Date, if any, for the Registered
Securities of such series (or on semi-annual dates in each year to be determined
pursuant to Section 3.01 if the Registered Securities of such series do not bear
interest), a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Registered Holders as of the date 15 days next
preceding each such Regular Record Date (or such semi-annual dates, 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;

PROVIDED, HOWEVER, that if and so long as the Trustee shall be the Security
Registrar for such series, no such list need be furnished.

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The Company shall also be required to furnish to the Trustee at all such times
set forth above all 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 Bearer Securities of all series; PROVIDED, however, that the
Company shall have no obligation to investigate any matter relating to any
Holders of Bearer Securities of any series.

Section 7.02. PRESERVATION OF INFORMATION; COMMUNICATION TO HOLDERS.

(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of Holders contained
in the most recent list furnished to the Trustee as provided in Section 7.01
received by it in the capacity of Paying Agent (if so acting) hereunder, and
filed with it within the two preceding years pursuant to Section 7.03(c)(2).

The Trustee may destroy any list furnished to it as PROVIDED in
Section 7.01 upon receipt of a new list so furnished, destroy any information
received by it as Paying Agent (if so acting) hereunder upon delivering to
itself as Trustee, not earlier than 45 days after an Interest Payment Date, a
list containing the names and addresses of the Holders obtained from such
information since the delivery of the next previous list, if any, destroy any
list delivered to itself as Trustee which was compiled from information received
by it as Paying Agent (if so acting) hereunder upon the receipt of a new list so
delivered, and destroy, not earlier than two years after filing, any information
filed with it pursuant to Section 7.03(c)(2).

(b) If three or more Holders (hereinafter referred to as
"applicants") apply in writing to the Trustee, and furnish to the Trustee
reasonable proof that each such applicant has owned a Debt Security for a period
of at least six months preceding the date of such application, and such
application states that the applicants desire to communicate with other Holders
of Debt Securities of a particular series (in which case the applicants must
hold Debt Securities of such series) or with all Holders of Debt Securities with
respect to their rights under this Indenture or under the Debt Securities and is
accompanied by a copy of the form of proxy or other communication which such
applicants propose to transmit, then the Trustee shall, within five Business
Days after the receipt of such application, at its election, either

(i) afford such applicants access to the information preserved at the
time by the Trustee in accordance with Section 7.02(a), or

(ii) inform such applicants as to the approximate number of Holders of
Debt Securities of such series or of all Debt Securities, as the case may
be, whose names and addresses appear in the information preserved at the
time by the Trustee in accordance with Section 7.02(a), and as to the
approximate cost of mailing to such Holders the form of proxy or other
communication, specified in such application.

If the Trustee shall elect not to afford such applicants access to
such information, the Trustee shall, upon written request of such applicants,
mail to the Holders of Debt Securities of such series or all Holders, as the
case may be, whose names and addresses appear in the information preserved at
the time by the Trustee in accordance with Section 7.02(a), a copy of the form
of proxy or other communication which is specified in such request, with
reasonable promptness after a tender to the Trustee of the material to be mailed
and of payment, or provision for the payment, of the reasonable expenses of
mailing, unless within five Business Days after such tender, the Trustee shall
mail to such applicants and file with the Commission, together with a copy of
the material to be mailed, a written statement to the effect that, in the
opinion of the Trustee, such mailing would be contrary to the best

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interests of the Holders of Debt Securities of such series or all Holders, as
the case may be, or would be in violation of applicable law. Such written
statement shall specify the basis of such opinion. If the Commission, after
opportunity for a hearing upon the objections specified in the written statement
so filed, shall enter an order refusing to sustain any of such objections or if
after the entry of an order sustaining one or more of such objections, the
Commission shall find, after notice and opportunity for hearing, that all the
objections so sustained have been met and shall enter an order so declaring, the
Trustee shall mail copies of such material to all such Holders with reasonable
promptness after the entry of such order and the renewal of such tender;
otherwise the Trustee shall be relieved of any obligation or duty to such
applicants respecting their application.

(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 shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders in accordance with
Section 7.02(b), regardless of the source from which such information was
derived, and that the Trustee shall not be held accountable by reason of mailing
of any material pursuant to a request made under Section 7.02(b).

Section 7.03. REPORTS BY TRUSTEE.

(a) Within 60 days after [DATE] of each year, commencing with the
first [DATE] after the first issuance of Debt Securities pursuant to this
Indenture, the Trustee shall, to the extent required by the Trust Indenture Act,
transmit to all Holders of Debt Securities of any series with respect to which
it acts as Trustee, in the manner hereinafter provided in this Section 7.03, a
brief report dated such date with respect to any of the following events which
may have occurred within the previous 12 months (but if no such event has
occurred within such period, no report need be transmitted):

(1) any change to its eligibility under Section 6.09 and its
qualifications under Section 6.08;

(2) the creation of or any material change to a relationship
specified in paragraph (1) through (10) of Section 6.08(c) of this
Indenture;

(3) the character and amount of any advances (and if the Trustee
elects so to state, the circumstances surrounding the making thereof) made
by the Trustee (as such) which remain unpaid on the date of such report,
and for the reimbursement of which it claims or may claim a lien or charge,
prior to that of the Debt Securities of such series, on any property or
funds held or collected by it as Trustee, except that the Trustee shall not
be required (but may elect) to report such advances if such advances so
remaining unpaid aggregate not more than 1/2 of 1% of the principal amount
of the Outstanding Debt Securities of such series on the date of such
report;

(4) any change to the amount, interest rate and maturity date of all
other indebtedness owing by the Company (or any other obligor on the Debt
Securities of such series) to the Trustee in its individual capacity, on
the date of such report, with a brief description of any property held as
collateral security therefor, except an indebtedness based upon a creditor
relationship arising in any manner described in Section 6.13(b)(2), (3),
(4) or (6);

(5) any change to the property and funds, if any, physically in the
possession of the Trustee as such on the date of such report;

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(6) any additional issue of Debt Securities which the Trustee has not
previously reported; and

(7) any action taken by the Trustee in the performance of its duties
hereunder which it has not previously reported and which, in its opinion,
materially affects the Debt Securities of such series, except action in
respect of a default, notice of which has been or is to be withheld by the
Trustee in accordance with Section 6.02.

(b) The Trustee shall transmit by mail to all Holders of Debt
Securities of any series (whose names and addresses appear in the information
preserved at the time by the Trustee in accordance with Section 7.02 (a)) for
which it acts as the Trustee, as hereinafter provided, a brief report with
respect to the character and amount of any advances (and if the Trustee elects
so to state, the circumstances surrounding the making thereof) made by the
Trustee (as such) since the date of the last report transmitted pursuant to
subsection (a) of this Section (or if no such report has yet been so
transmitted, since the date of execution of this instrument) for the
reimbursement of which it claims or may claim a lien or charge, prior to that of
the Debt Securities of such series, on property or funds held or collected by it
as Trustee, and which it has not previously reported pursuant to this
subsection, except that the Trustee for each series shall not be required (but
may elect) to report such advances if such advances remaining unpaid at any time
aggregate 10% or less of the principal amount of the Debt Securities of such
series Outstanding at such time, such report to be transmitted within 90 days
after such time.

(1) to all Holders of Registered Securities, as the names and
addresses of such Holders of Registered Securities appear in the Security
Register;

(2) to such Holders of Bearer Securities of any series as have,
within two years preceding such transmission, filed their names and
addresses with the Trustee for such series for that purpose; and

(3) except in the cases of reports pursuant to subsection (b) of this
Section 7.03, to each Holder of a Debt Security of any series whose name
and address appear in the information preserved at the time by the Trustee
in accordance with Section 7.02(a).

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

Section 7.04. REPORTS BY COMPANY.

Unless otherwise specified with respect to a particular series of Debt
Securities pursuant to Section 3.01, the Company will file with the Trustee,
within 15 days after the Company is required to file the same with the
Commission, copies of the annual reports and of the information, documents and
other reports which the Company may be required to file with the Commission
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934,
as amended.

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ARTICLE EIGHT

CONCERNING THE HOLDERS

Section 8.01. ACTS OF HOLDERS.

Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent or proxy duly appointed in
writing; and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee, and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Whenever in this Indenture it is provided that
the Holders of a specified percentage in aggregate principal amount of the
Outstanding Debt Securities of any series may take any Act, the fact that the
Holders of such specified percentage have joined therein may be evidenced (a) by
the instrument or instruments executed by Holders in person or by agent or proxy
appointed in writing, or (b) by the record of Holders voting in favor thereof at
any meeting of such Holders duly called and held in accordance with the
provisions of Article Nine, or (c) by a combination of such instrument or
instruments and any such record of such a meeting of Holders.

Section 8.02. PROOF OF OWNERSHIP; PROOF OF EXECUTION OF INSTRUMENTS
BY HOLDER.

The ownership of Registered Securities of any series shall be proved
by the Security Register for such series or by a certificate of the Security
Registrar for such series.

The ownership of Bearer Securities shall be proved by production of
such Bearer Securities or by a certificate executed by any bank or trust
company, which certificate shall be dated and shall state that, on the date
thereof, a Bearer Security bearing a specified identifying number or other mark
was deposited with, or exhibited to, the person executing such certificate by
the Person named in such certificate, or by any other proof of possession
reasonably satisfactory to the Trustee. The holding by the Person named in any
such certificate of any Bearer Security specified therein shall be presumed to
continue for a period of one year unless at the time of determination of such
holding (1) another certificate bearing a later date issued in respect of the
same Bearer Security shall be produced, (2) such Bearer Security shall be
produced by some other Person, (3) such Bearer Security shall have been
registered on the Security Register, if, pursuant to Section 3.01, such Bearer
Security can be so registered, or (4) such Bearer Security shall have been
cancelled or paid.

Subject to the provisions of Sections 6.01, 6.03 and 9.05, proof of
the execution of a writing appointing an agent or proxy and of the execution of
any instrument by a Holder or his agent or proxy shall be sufficient and
conclusive in favor of the Trustee and the Company if made in the following
manner:

The fact and date of the execution by any such person of any
instrument may be proved by the certificate of any notary public or other
officer authorized to take acknowledgements of deeds, that the Person executing
such instrument acknowledged to him the execution thereof, or by an affidavit of
a witness to such execution sworn to before any such notary or other such
officer. Where such execution is by an officer of a corporation or association
or a member of a partnership on behalf of such corporation, association or
partnership, as the case may be, or by any other Person acting in a
representative capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority.

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The record of any Holders' meeting shall be proved in the manner
provided in Section 9.06.

The Trustee may in any instance require further proof with respect to
any of the matters referred to in this Section so long as the request is a
reasonable one.

Section 8.03. PERSONS DEEMED OWNERS.

The Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name any Registered Security is registered as the
owner of such Registered Security for the purpose of receiving payment of the
principal of (and premium, if any) and (subject to Section 3.07) interest, if
any, on such Registered Security and for all other purposes whatsoever, whether
or not such Registered 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. The Company, the Trustee, and any agent of the Company or the Trustee
may treat the Holder of any Bearer Security or of any Coupon as the absolute
owner of such Bearer Security or Coupon for the purposes of receiving payment
thereof or on account thereof and for all other purposes whatsoever, whether or
not such Bearer Security or Coupon 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. All payments made to any Holder, or upon his order, shall be
valid, and, to the extent of the sum or sums paid, effectual to satisfy and
discharge the liability for moneys payable upon such Debt Security or Coupon.

Section 8.04. REVOCATION OF CONSENTS; FUTURE HOLDERS BOUND.

At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 8.01, of the taking of any Act by the Holders of the
percentage in aggregate principal amount of the Outstanding Debt Securities
specified in this Indenture in connection with such Act, any Holder of a Debt
Security the number, letter or other distinguishing symbol of which is shown by
the evidence to be included in the Debt Securities the Holders of which have
consented to such Act may, by filing written notice with the Trustee at the
Corporate Trust Office and upon proof of ownership as provided in Section 8.02,
revoke such Act so far as it concerns such Debt Security. Except as aforesaid,
any such Act taken by the Holder of any Debt Security shall be conclusive and
binding upon such Holder and, subject to the provisions of Section 5.08, upon
all future Holders of such Debt Security and all past, present and future
Holders of Coupons, if any, appertaining thereto and of any Debt Securities and
Coupons issued on transfer or in lieu thereof or in exchange or substitution
therefor, irrespective of whether or not any notation in regard thereto is made
upon such Debt Security or Coupons or such other Debt Securities or Coupons.

ARTICLE NINE

HOLDERS' MEETINGS

Section 9.01. PURPOSES OF MEETINGS.

A meeting of Holders of any or all series may be called at any time
and from time to time pursuant to the provisions of this Article Nine for any of
the following purposes:

(1) to give any notice to the Company or to the Trustee for such
series, or to give any directions to the Trustee for such series, or to
consent to the waiving of any default

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hereunder and its consequences, or to take any other action authorized to
be taken by Holders pursuant to any of the provisions of Article Five;

(2) to remove the Trustee for such series and appoint a successor
Trustee pursuant to the provisions of Article Six;

(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
Outstanding Debt Securities of any one or more or all series, as the case
may be, under any other provision of this Indenture or under applicable
law.

Section 9.02. CALL OF MEETINGS BY TRUSTEE.

The Trustee for any series may at any time call a meeting of Holders
of such series to take any action specified in Section 9.01, to be held at such
time or times and at such place or places as the Trustee for such series shall
determine. Notice of every meeting of the Holders of any series, setting forth
the time and the place of such meeting and in general terms the action proposed
to be taken at such meeting, shall be given to Holders of such series in the
manner and to the extent PROVIDED in Section 1.05. Such notice shall be given
not less than 10 days nor more than 90 days prior to the date fixed for the
meeting.

Section 9.03. CALL OF MEETINGS BY COMPANY OR HOLDERS.

In case at any time the Company, pursuant to a Board Resolution, or
the Holders of at least 10% in aggregate principal amount of the Outstanding
Debt Securities of a series or of all series, as the case may be, shall have
requested the Trustee for such series to call a meeting of Holders of any or all
such series by written request setting forth in reasonable detail the action
proposed to be taken at the meeting, and the Trustee shall not have given the
notice of such meeting within 10 days after the receipt of such request, then
the Company or such Holders may determine the time or times and the place or
places for such meetings and may call such meetings to take any action
authorized in Section 9.01, by giving notice thereof as PROVIDED in Section
9.02.

Section 9.04. QUALIFICATIONS FOR VOTING.

To be entitled to vote at any meeting of Holders a Person shall be (a)
a Holder of a Debt Security of the series with respect to which such meeting is
being held or (b) a Person appointed by an instrument in writing as agent or
proxy by such Holder. The only Persons who shall be entitled to be present or
to speak at any meeting of Holders shall be the Persons entitled to vote at such
meeting and their counsel, any representatives of the Trustee for the series
with respect to which such meeting is being held and its counsel and any
representatives of the Company and its counsel.

Section 9.05. REGULATIONS.

Notwithstanding any other provisions of this Indenture, the Trustee
for any series may make such reasonable regulations as it may deem advisable for
any meeting of Holders of such series, in regard to proof of the holding of Debt
Securities of such series and of the appointment of proxies, and in regard to
the appointment and duties of inspectors of votes, the submission and
examination of proxies,

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certificates and other evidence of the right to vote, and such other matters
concerning the conduct of the meeting as it shall deem appropriate.

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 such series as provided in Section 9.03, in which case
the Company or the Holders calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by at least a majority vote of the
meeting.

Subject to the provisos in the definition of "Outstanding," at any
meeting each Holder of a Debt Security of the series with respect to which such
meeting is being held or proxy therefor shall be entitled to one vote for each
$1,000 principal amount (or such other amount as shall be specified as
contemplated by Section 3.01) of Debt Securities of such series held or
represented by such Holder 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 other than by virtue of
Outstanding Debt Securities of such series held by him or her or instruments in
writing duly designating him or her as the person to vote on behalf of Holders
of Debt Securities of such series. Any meeting of Holders with respect to which
a meeting was duly called pursuant to the provisions of Section 9.02 or 9.03 may
be adjourned from time to time by at least a majority of such Holders present
and the meeting may be held as so adjourned without further notice.

Section 9.06. VOTING.

The vote upon any resolution submitted to any meeting of Holders with
respect to which such meeting is being held shall be by written ballots on which
shall be subscribed the signatures of such Holders or of their representatives
by proxy and the serial number or numbers of the Debt Securities held or
represented by them. The permanent chairman of the meeting shall appoint two
inspectors of votes who shall count all votes cast at the meeting for or against
any resolution and who shall make and file with the secretary of the meeting
their verified written reports in duplicate of all votes cast at the meeting. A
record in duplicate of the proceedings of each meeting of Holders shall be taken
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 transmitted as provided in Section
9.02. The record shall show the serial numbers of the Debt Securities voting in
favor of or against any resolution. 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.

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

Section 9.07. NO DELAY OF RIGHTS BY MEETING.

Nothing contained in this Article Nine shall be deemed or construed to
authorize or permit, by reason of any call of a meeting of Holders 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 any Holder under any of the provisions of this Indenture or of the
Debt Securities of any series.

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ARTICLE TEN

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

Section 10.01. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.

The Company shall not consolidate with, merge with or into, or sell,
assign, convey, transfer or lease its properties and assets substantially in
their entirety (computed on a consolidated basis) to any Person, unless:

(1) either (A) the Company is the surviving entity or (B) the
successor or transferee (the "successor corporation") is a corporation
organized and existing under the laws of the United States, any State
thereof or the District of Columbia and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Trustee, all
of the obligations of the Company under the Debt Securities and this
Indenture;

(2) immediately after giving effect to such transaction, no Event of
Default or Default shall exist; and

(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel each stating that such consolidation, merger,
conveyance, transfer or lease and such supplemental indenture comply with
this provision and that all conditions precedent herein provided for
relating to such transaction have been complied with.

Section 10.02. SUCCESSOR CORPORATION SUBSTITUTED.

Upon any consolidation with or merger into any other corporation, or
any conveyance, transfer or lease of the properties and assets of the Company
substantially in their entirety in accordance with Section 10.01, the successor
corporation formed by such consolidation or into which the Company is merged or
to which such conveyance, transfer or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor corporation had been
named as the Company herein.

ARTICLE ELEVEN

SUPPLEMENTAL INDENTURES

Section 11.01. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.

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

(1) to evidence the succession of another corporation to the rights
of the Company and the assumption by such successor of the covenants and
obligations of the Company contained herein and in the Debt Securities; or

(2) to add to the covenants of the Company, for the benefit of the
Holders of all or any series of Debt Securities (and if such covenants are
to be for the benefit of less than all

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series, stating that such covenants are expressly being included solely for
the benefit of such series), or to surrender any right or power herein
conferred upon the Company; or

(3) to add any additional Events of Default (and if such Events of
Default are to be applicable to less than all series, stating that such
Events of Default are expressly being included solely to be applicable to
such series); or

(4) to add or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of Debt
Securities of any series in bearer form, registrable or not registrable,
and with or without Coupons, to permit Bearer Securities to be issued in
exchange for Registered Securities, to permit Bearer Securities to be
issued in exchange for Bearer Securities of other authorized denominations
or to permit the issuance of Debt Securities of any series in
uncertificated form, PROVIDED that any such action shall not adversely
affect the interests of the Holders of Debt Securities of any series or any
related Coupons in any material respect; or

(5) to change or eliminate any of the provisions of this Indenture,
PROVIDED that any such change or elimination shall become effective only
when there is no Outstanding Debt Security or Coupon of any series created
prior to the execution of such supplemental indenture which is entitled to
the benefit of such provision and as to which such supplemental indenture
would apply; or

(6) to secure the Debt Securities or to provide that any of the
Company's obligations under any series of the Debt Securities or this
Indenture shall be guaranteed and the terms and conditions for the release
or substitution of such security or guarantee; or

(7) to supplement any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the defeasance and
discharge of any series of Debt Securities pursuant to Article Four or
Fifteen, PROVIDED that any such action shall not adversely affect the
interests of the Holders of Debt Securities of such series or any other
series of Debt Securities or any related Coupons in any material respect;
or

(8) to establish the form or terms of Debt Securities and Coupons, if
any, of any series as permitted by Sections 2.01 and 3.01; or

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

(10) to comply with the requirements of the Commission in connection
with the qualification of this Indenture under the Trust Indenture Act;

(11) to cure any ambiguity, to correct or supplement any provision
herein which may be defective or inconsistent with any other provision
herein or to make any other provisions with respect to matters or questions
arising under this Indenture which shall not be inconsistent with any
provision of this Indenture; PROVIDED such other provisions shall not
adversely affect the interests of the Holders of Outstanding Debt
Securities or Coupons, if any, of any series created prior to the execution
of such supplemental indenture in any material respect.

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Section 11.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.

With the written consent of the Holders of not less than at least a
majority in principal amount of the Outstanding Debt Securities of each series
affected by such supplemental indenture, by Act of said Holders delivered to the
Company and the Trustee, the Company, when authorized by a Board Resolution, and
the Trustee may enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Indenture or of modifying in any manner the rights
of the Holders under this Indenture of such Debt Securities and Coupons, if any;
PROVIDED, HOWEVER, that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Debt Security of each such series
affected thereby,

(1) change the Stated Maturity of the principal of, or any
installment of principal of or interest on, any Debt Security, or reduce
the principal amount thereof or the rate (or extend the time for payment)
of interest thereon or any premium payable upon redemption thereof or
change the Stated Maturity of or reduce the amount of any payment to be
made with respect to any Coupon, or change the Currency or Currencies in
which the principal of (and premium, if any) or interest on such Debt
Security is denominated or payable, or reduce the amount of the principal
of a Discount Security that would be due and payable upon a declaration of
acceleration of the Maturity thereof pursuant to Section 5.02, or impair
the right to institute suit for the enforcement of any payment on or after
the Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date), or alter any redemption provisions in a manner adverse to
the Holders of such series of Debt Securities or adversely affect the right
to convert any Debt Security into shares of Common Stock or other
securities or property of the Company as may be PROVIDED pursuant to
Section 3.01; or

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

(3) modify any of the provisions of this Section, Section 5.13, or
Section 12.06, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Debt Security of each
series affected thereby; PROVIDED, HOWEVER, that this clause shall not be
deemed to require the consent of any Holder with respect to changes in the
references to "the Trustee" and concomitant changes in this Section, or the
deletion of this proviso, in accordance with the requirements of Sections
6.11 and 11.01(9).

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

A supplemental indenture which changes or eliminates any covenant or
other provision of this Indenture with respect to one or more particular series
of Debt Securities and Coupons, if any, or which modifies the rights of the
Holders of Debt Securities and Coupons of such series with respect to such
covenant or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Debt securities and Coupons, if any, of any other
series.

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Section 11.03. EXECUTION OF SUPPLEMENTAL INDENTURES.

In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 6.01) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which adversely affects
the Trustee's own rights, duties or immunities under this Indenture or otherwise
in a material way.

Section 11.04. EFFECT OF SUPPLEMENTAL INDENTURES.

Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Debt Securities and Coupons theretofore or thereafter authenticated and
delivered hereunder shall be bound thereby.

Section 11.05. CONFORMITY WITH TRUST INDENTURE ACT.

Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.

Section 11.06. REFERENCE IN DEBT SECURITIES TO SUPPLEMENTAL
INDENTURES.

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

ARTICLE TWELVE

COVENANTS

Section 12.01. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.

The Company covenants and agrees for the benefit of each series of
Debt Securities and Coupons, if any, that it will duly and punctually pay the
principal of (and premium, if any) and interest on the Debt Securities in
accordance with the terms of the Debt Securities, the Coupons and this
Indenture. Unless otherwise specified as contemplated by Section 3.01 with
respect to any series of Debt Securities or except as otherwise provided in
Section 3.06, any interest due on Bearer Securities on or before Maturity shall
be payable only upon presentation and surrender of the several Coupons for such
interest installments as are evidenced thereby as they severally mature. If so
provided in the terms of any series of Debt Securities established as provided
in Section 3.01, the interest, if any, due in respect of any temporary Global
Note or permanent Global Note, together with any additional amounts payable in
respect thereof, as provided in the terms and conditions of such Debt Security,
shall be payable only

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upon presentation of such Debt Security to the Trustee for notation thereon of
the payment of such interest.

Section 12.02. OFFICER'S CERTIFICATE AS TO COMPLIANCE.

Unless otherwise specifically provided for with respect to any series
of Debt Securities under Section 3.01, the Company will deliver to the Trustee,
within 120 days after the end of each fiscal year, a certificate of the
principal executive officer, principal financial officer or principal accounting
officer of the Company stating whether or not, to the knowledge of the signer
thereof, the Company is in compliance with all covenants and conditions under
this Indenture, and, in the event of any noncompliance, specifying such
noncompliance and the nature and status thereof of which such signer may have
knowledge. For purposes of this Section, such compliance shall be determined
without regard to any period of grace or requirement of notice provided under
this Indenture.

Section 12.03. MAINTENANCE OF OFFICE OR AGENCY.

If Debt Securities of a series are issuable only as Registered
Securities, the Company will maintain in each Place of Payment for such series
an office or agency where Debt Securities of that series may be presented or
surrendered for payment, where Debt Securities of that series may be surrendered
for registration of transfer or exchange, where Debt Securities of that series
that are convertible may be surrendered for conversion, if applicable, and where
notices and demands to or upon the Company in respect of the Debt Securities of
that series and this Indenture may be served. If Debt Securities of a series
are issuable as Bearer Securities, the Company will maintain (A) in the Borough
of Manhattan, the City and State of New York, an office or agency where any
Registered Securities of that series may be presented or surrendered for
payment, where any Registered Securities of that series may be surrendered for
registration of transfer, where Debt Securities of that series may be
surrendered for exchange or redemption, where notices and demands to or upon the
Company in respect of the Debt Securities of that series and this Indenture may
be served and where Bearer Securities of that series and related Coupons may be
presented or surrendered for payment in the circumstances described in the
following paragraph (and not otherwise), (B) subject to any laws or regulations
applicable thereto, in a Place of Payment for that series which is located
outside the United States, an office or agency where Debt Securities of that
series and related Coupons may be presented and surrendered for payment
(including payment of any additional amounts payable on Debt Securities of that
series, if so PROVIDED pursuant to Section 3.01); PROVIDED, HOWEVER, that if the
Debt Securities of that series are listed on The Stock Exchange of the United
Kingdom and the Republic of Ireland, the Luxembourg Stock Exchange or any other
stock exchange located outside the United States and such stock exchange shall
so require, the Company will maintain a Paying Agent for the Debt Securities of
that series in London, Luxembourg or any other required city located outside the
United States, as the case may be, so long as the Debt Securities of that series
are listed on such exchange, and (C) subject to any laws or regulations
applicable thereto, in a Place of Payment for that series located outside the
United States an office or agency where any Registered Securities of that series
may be surrendered for registration of transfer, where Debt Securities of that
series may be surrendered for exchange or redemption and where notices and
demands to or upon the Company in respect of the Debt Securities of that series
and this Indenture may be served. The Company will give prompt written notice
to the Trustee of the location, and any change in the location, of such office
or agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee (in the case of Registered Securities) and
at the principal London office of the Trustee (in the case of Bearer
Securities), and the Company hereby appoints the Trustee as its agent to receive
all presentations, surrenders, notices and demands.

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No payment of principal, premium or interest on Bearer Securities
shall be made at any office or agency of the Company in the United States or by
check mailed to any address in the United States or by transfer to an account
maintained with a bank located in the United States; PROVIDED, HOWEVER, that, if
the Debt Securities of a series are denominated and payable in Dollars, payment
of principal of and any premium and interest on Debt Securities (including any
additional amounts payable on Securities of such series, if so PROVIDED pursuant
to Section 3.01) shall be made at the office of the Company's Paying Agent in
the Borough of Manhattan, the City and State of New York, if (but only if)
payment in Dollars of the full amount of such principal, premium, interest or
additional amounts, as the case may be, at all offices or agencies outside the
United States maintained for the purpose by the Company in accordance with this
Indenture is illegal or effectively precluded by exchange controls or other
similar restrictions.

The Company may also from time to time designate different or
additional offices or agencies to be maintained for such purposes (in or outside
of such Place of Payment), and may from time to time rescind any such
designations; PROVIDED, HOWEVER, that no such designation or rescission shall in
any manner relieve the Company of its obligations described in the preceding
paragraph. The Company will give prompt written notice to the Trustee of any
such additional designation or rescission of designation and any change in the
location of any such different or additional office or agency.

Section 12.04. MONEY FOR DEBT SECURITIES; PAYMENTS TO BE HELD IN
TRUST.

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

Whenever the Company shall have one or more Paying Agents with respect
to any series of Debt Securities and Coupons, it will, by or on each due date of
the principal (and premium, if any) or interest on any Debt Securities of such
series, deposit with any such Paying Agent a sum sufficient to pay the principal
(and premium, if any) or interest so becoming due, such sum to be held in trust
for the benefit of the Persons entitled thereto, and (unless any such Paying
Agent is the Trustee) the Company will promptly notify the Trustee of its action
or failure so to act.

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

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

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

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

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

Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of (and premium, if
any) or interest on any Debt Security of any series and remaining unclaimed for
two years after such principal (and premium, if any) or interest has become due
and payable shall be paid to the Company upon Company Request, or (if then held
by the Company) shall be discharged from such trust; and the Holder of such Debt
Security or Coupon shall thereafter, as an unsecured general creditor, look only
to the Company for payment thereof, and all liability of the Trustee or such
Paying Agent with respect to such trust money, and all liability of the Company
as trustee thereof, shall thereupon cease; PROVIDED, HOWEVER, that the Trustee
or such Paying Agent, before being required to make any such repayment, may at
the expense of the Company cause to be transmitted in the manner and to the
extent provided by Section 1.05, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than 30 days from
the date of such notification, any unclaimed balance of such money then
remaining will be repaid to the Company.

Section 12.05. CORPORATE EXISTENCE.

Subject to Article Ten, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence; PROVIDED, HOWEVER, that the Company shall not be required to preserve
its corporate existence if the Company shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Company.

Section 12.06. WAIVER OF CERTAIN COVENANTS.

The Company may omit in any particular instance to comply with any
term, provision or condition set forth in Sections 12.01 and 12.03 through 12.05
(and, if so specified pursuant to Section 3.01, any other covenant not set forth
herein and specified pursuant to Section 3.01 to be applicable to the Debt
Securities of any series, except as otherwise provided pursuant to Section 3.01)
with respect to the Debt Securities of any series if before the time for such
compliance the Holders of at least at least a majority in principal amount of
the Outstanding Debt Securities of such series shall, by Act of such Holders,
either waive such compliance in such instance or generally waive compliance with
such term, provision or condition, but no such waiver shall extend to or affect
such term, provision or condition except to the extent expressly so waived, and,
until such waiver shall become effective, the obligations of the Company and the
duties of the Trustee in respect of any such term, provision or condition shall
remain in full force and effect.

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ARTICLE THIRTEEN

REDEMPTION OF DEBT SECURITIES

Section 13.01. APPLICABILITY OF ARTICLE.

Debt Securities of any series which are redeemable before their Stated
Maturity shall be redeemable in accordance with their terms and (except as
otherwise specified pursuant to Section 3.01 for Debt Securities of any series)
in accordance with this Article.

Section 13.02. ELECTION TO REDEEM; NOTICE TO TRUSTEE.

The election of the Company to redeem any Debt Securities shall be
evidenced by a Board Resolution. In case of any redemption at the election of
the Company of less than all of the Debt Securities of any series pursuant to
Section 13.03, the Company shall, at least 30 days before the Redemption Date
fixed by the Company (unless a shorter notice shall be satisfactory to the
Trustee), notify the Trustee of such Redemption Date and of the principal amount
of Debt Securities of such series to be redeemed. In the case of any redemption
of Debt Securities prior to the expiration of any restriction on such redemption
provided in the terms of such Debt Securities or elsewhere in this Indenture,
the Company shall furnish the Trustee with an Officers' Certificate evidencing
compliance with such restrictions.

Section 13.03. SELECTION BY TRUSTEE OF DEBT SECURITIES TO BE
REDEEMED.

Except in the case of a redemption in whole of the Bearer Securities
or the Registered Securities of such series, if less than all the Debt
Securities of any series are to be redeemed at the election of the Company, the
particular Debt Securities to be redeemed shall be selected not more than 60
days prior to the Redemption Date by the Trustee, from the Outstanding Debt
Securities of such series not previously called for redemption, by such method
as the Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions (equal to the minimum authorized
denomination for Debt Securities of such series or any integral multiple
thereof) of the principal amount of Debt Securities of such series in a
denomination larger than the minimum authorized denomination for Debt Securities
of such series pursuant to Section 3.02 in the Currency in which the Debt
Securities of such series are denominated. The portions of the principal amount
of Debt Securities so selected for partial redemption shall be equal to the
minimum authorized denominations for Debt Securities of such series pursuant to
Section 3.02 in the Currency in which the Debt Securities of such series are
denominated or any integral multiple thereof, except as otherwise set forth in
the applicable form of Debt Securities. In any case when more than one
Registered Security of such series is registered in the same name, the Trustee,
in its discretion, may treat the aggregate principal amount so registered as if
it were represented by one Registered Security of such series.

The Trustee shall promptly notify the Company and the Security
Registrar (if other than itself) in writing of the Debt Securities selected for
redemption and, in the case of any Debt Securities selected for partial
redemption, the principal amount thereof to be redeemed.

For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Debt Securities 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.

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Section 13.04. NOTICE OF REDEMPTION.

Notice of redemption shall be given by the Company, or at the
Company's request, by the Trustee in the name and at the expense of the Company,
not less than 30 days and not more than 60 days prior to the Redemption Date to
the Holders of Debt Securities of any series to be redeemed in whole or in part
pursuant to this Article Thirteen, in the manner provided in Section 1.05. Any
notice so given shall be conclusively presumed to have been duly given, whether
or not the Holder receives such notice. Failure to give such notice, or any
defect in such notice to the Holder of any Debt Security of a series designated
for redemption, in whole or in part, shall not affect the sufficiency of any
notice of redemption with respect to the Holder of any other Debt Security of
such series.

All notices of redemption shall state:

(1) the Redemption Date,

(2) the Redemption Price,

(3) that Debt Securities of such series are being redeemed by the
Company pursuant to provisions contained in this Indenture or the terms of
the Debt Securities of such series or a supplemental indenture establishing
such series, if such be the case, together with a brief statement of the
facts permitting such redemption,

(4) if less than all Outstanding Debt Securities of any series are to
be redeemed, the identification (and, in the case of partial redemption,
the principal amounts) of the particular Debt Securities to be redeemed,

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

(6) that, unless otherwise specified in such notice, Coupon
Securities of any series, if any, surrendered for redemption must be
accompanied by all Coupons maturing subsequent to the date fixed for
redemption, failing which the amount of any such missing Coupon or Coupons
will be deducted from the Redemption Price,

(7) the Place or Places of Payment where such Debt Securities are to
be surrendered for payment of the Redemption Price,

(8) if Bearer Securities of any series are to be redeemed and any
Registered Securities of such series are not to be redeemed, and if such
Bearer Securities may be exchanged for Registered Securities not subject to
redemption on this Redemption Date pursuant to Section 3.05(b) or
otherwise, the last date on which such exchanges may be made, and

(9) that the redemption is for a sinking fund, if such is the case.

Section 13.05. DEPOSIT OF REDEMPTION PRICE.

On or prior to the Redemption Date for any Debt Securities, the
Company shall deposit with the Trustee or with a Paying Agent (or, if the
Company is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 12.04) an amount of money in the Currency or Currencies in

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which such Debt Securities are denominated (except as provided pursuant to
Section 3.01) sufficient to pay the Redemption Price of such Debt Securities or
any portions thereof which are to be redeemed on that date.

Section 13.06. DEBT SECURITIES PAYABLE ON REDEMPTION DATE.

Notice of redemption having been given as aforesaid, any Debt
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price in the Currency in which the Debt Securities of
such series are payable (except as otherwise specified pursuant to Section 3.01
or 3.10), and from and after such date (unless the Company shall default in the
payment of the Redemption Price) such Debt Securities shall cease to bear
interest. Upon surrender of any such Debt Security for redemption in accordance
with said notice, such Debt Security shall be paid by the Company at the
Redemption Price; PROVIDED, HOWEVER, that installments of interest on Bearer
Securities whose Stated Maturity is on or prior to the Redemption Date shall be
payable only at an office or agency located outside the United States (except as
otherwise provided in Section 12.03) and, unless otherwise specified as
contemplated by Section 3.01, only upon presentation and surrender of Coupons
for such interest; and PROVIDED, FURTHER, that, unless otherwise specified as
contemplated by Section 3.01, installments of interest on Registered Securities
which have a Stated Maturity on or prior to the Redemption Date for such Debt
Securities shall be payable according to the terms of such Debt Securities and
the provisions of Section 3.07.

If any Debt Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Debt Security.

If any Coupon Security surrendered for redemption shall not be
accompanied by all Coupons appertaining thereto maturing on or after the
Redemption Date, the Redemption Price for such Coupon Security may be reduced by
an amount equal to the face amount of all such missing Coupons. If thereafter
the Holder of such Coupon shall surrender to any Paying Agent outside the United
States any such missing Coupon in respect of which a deduction shall have been
made from the Redemption Price, such Holder shall be entitled to receive the
amount so deducted. The surrender of such missing Coupon or Coupons may be
waived by the Company and the Trustee, if there be furnished to them such
security or indemnity as they may require to save each of them and any Paying
Agent harmless.

Section 13.07. DEBT SECURITIES REDEEMED IN PART.

Any Debt Security which is to be redeemed only in part shall be
surrendered at the Corporate Trust Office or such other office or agency of the
Company as is specified pursuant to Section 3.01 (in the case of Registered
Securities) and at an office of the Trustee or such other office or agency of
the Company outside the United States as is specified pursuant to Section 3.01
(in the case of Bearer Securities) with, if the Company, the Security Registrar
or the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company, the Security Registrar and the
Trustee duly executed by, the Holder thereof or such Holder's attorney duly
authorized in writing, and the Company shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Debt Security without service
charge, a new Debt Security or Debt Securities of the same series, of like tenor
and form, of any authorized denomination as requested by such Holder in
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Debt Security so surrendered, and, in the case of a
Coupon Security, with appropriate Coupons attached. In the case of a Debt
Security providing appropriate space for such notation, at the option of the
Holder thereof, the Trustee, in lieu

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of delivering a new Debt Security or Debt Securities as aforesaid, may make a
notation on such Debt Security of the payment of the redeemed portion thereof.

ARTICLE FOURTEEN

SINKING FUNDS

Section 14.01. APPLICABILITY OF ARTICLE.

The provisions of this Article shall be applicable to any sinking fund
for the retirement of Debt Securities of a series except as otherwise specified
pursuant to Section 3.01 for Debt Securities of such series.

The minimum amount of any sinking fund payment provided for by the
terms of Debt Securities of any series is herein referred to as a "mandatory
sinking fund payment," and any payment in excess of such minimum amount provided
for by the terms of Debt Securities of any series is herein referred to as an
"optional sinking fund payment." If provided for by the terms of Debt
Securities of any series, the amount of any cash sinking fund payment may be
subject to reduction as provided in Section 14.02. Each sinking fund payment
shall be applied to the redemption of Debt Securities of any series as provided
for by the terms of Debt Securities of such series.

Section 14.02. SATISFACTION OF MANDATORY SINKING FUND PAYMENTS WITH
DEBT SECURITIES.

In lieu of making all or any part of a mandatory sinking fund payment
with respect to any Debt Securities of a series in cash, the Company may at its
option, at any time no more than sixteen months and no less than 45 days prior
to the date on which such sinking fund payment is due, deliver to the Trustee
Debt Securities of such series (together with the unmatured Coupons, if any,
appertaining thereto) theretofore purchased or otherwise acquired by the
Company, except Debt Securities of such series which have been redeemed through
the application of mandatory sinking fund payments pursuant to the terms of the
Debt Securities of such series, accompanied by a Company Order instructing the
Trustee to credit such obligations and stating that the Debt Securities of such
series were originally issued by the Company by way of bona fide sale or other
negotiation for value, PROVIDED that such Debt Securities shall not have been
previously so credited. Such Debt Securities shall be received and credited for
such purpose by the Trustee at the Redemption Price specified in such Debt
Securities for redemption through operation of the sinking fund and the amount
of such mandatory sinking fund payment shall be reduced accordingly.

Section 14.03. REDEMPTION OF DEBT SECURITIES FOR SINKING FUND.

Not less than 60 days prior to each sinking fund payment date for any
series of Debt Securities (unless a shorter period shall be satisfactory to the
Trustee), the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for that series
pursuant to the terms of that series, the portion thereof, if any, which is to
be satisfied by payment of cash in the Currency or Currencies in which the Debt
Securities of such series are denominated (except as PROVIDED pursuant to
Section 3.01) and the portion thereof, if any, which is to be satisfied by
delivering and crediting Debt Securities of such series pursuant to Section
14.02 and whether the Company intends to exercise its rights to make a permitted
optional sinking fund payment with respect to such series. Such certificate
shall be irrevocable and, upon its delivery, the Company shall be obligated to
make the cash payment or payments therein referred to, if any, on or before the
next

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succeeding sinking fund payment date. In the case of the failure of the Company
to deliver such certificate, the sinking fund payment due on the next succeeding
sinking fund payment date for such series shall be paid entirely in cash and
shall be sufficient to redeem the principal amount of the Debt Securities of
such series subject to a mandatory sinking fund payment without the right to
deliver or credit Debt Securities as provided in Section 14.02 and without the
right to make any optional sinking fund payment with respect to such series at
such time.

Any sinking fund payment or payments (mandatory or optional) made in
cash plus any unused balance of any preceding sinking fund payments made with
respect to the Debt Securities of any particular series shall be applied by the
Trustee (or by the Company if the Company is acting as its own Paying Agent) on
the sinking fund payment date on which such payment is made (or, if such payment
is made before a sinking fund payment date, on the sinking fund payment date
immediately following the date of such payment) to the redemption of Debt
Securities of such series at the Redemption Price specified in such Debt
Securities with respect to the sinking fund. Any sinking fund moneys not so
applied or allocated by the Trustee (or by the Company if the Company is acting
as its own Paying Agent) to the redemption of Debt Securities shall be added to
the next sinking fund payment received by the Trustee (or if the Company is
acting as its own Paying Agent, segregated and held in trust as provided in
Section 12.04) for such series and, together with such payment (or such amount
so segregated) shall be applied in accordance with the provisions of this
Section. Any and all sinking fund moneys with respect to the Debt Securities of
any particular series held by the Trustee (or if the Company is acting as its
own Paying Agent, segregated and held in trust as provided in Section 12.04) on
the last sinking fund payment date with respect to 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 (or by the Company if the Company
is acting as its own Paying Agent), together with other moneys, if necessary, to
be deposited (or segregated) sufficient for the purpose, to the payment of the
principal of the Debt Securities of such series at Maturity.

The Trustee shall select or cause to be selected the Debt Securities
to be redeemed upon such sinking fund payment date in the manner specified in
Section 13.03 and the Company shall cause notice of the redemption thereof to be
given in the manner provided in Section 13.04. Such notice having been duly
given, the redemption of such Debt Securities shall be made upon the terms and
in the manner stated in Section 13.06.

On or before each sinking fund payment date, the Company shall pay to
the Trustee (or, if the Company is acting as its own Paying Agent, the Company
shall segregate and hold in trust as provided in Section 12.04) in cash a sum,
in the Currency or Currencies in which Debt Securities of such series are
denominated (except as provided pursuant to Sections 3.01 or 3.10), equal to the
principal and any interest accrued to the Redemption Date for Debt Securities or
portions thereof to be redeemed on such sinking fund payment date pursuant to
this Section.

ARTICLE FIFTEEN

DEFEASANCE

Section 15.01. APPLICABILITY OF ARTICLE.

Except as otherwise provided in Section 15.02 or as provided pursuant
to Section 3.01 with respect to a particular series of Debt Securities, the
Company may terminate its obligations under

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the Debt Securities of any series and this Indenture with respect to Debt
Securities of such series as set forth in Section 15.02.

Section 15.02. DEFEASANCE UPON DEPOSIT OF MONEYS OR U.S. GOVERNMENT
OBLIGATIONS.

At the Company's option, either (a) the Company shall be deemed to
have been Discharged (as defined below) from its obligations with respect to
Debt Securities of any series ("legal defeasance option") or (b) the Company
shall cease to be under any obligation to comply with any term, provision or
condition set forth in Section 10.01 with respect to Debt Securities of any
series (and, if so specified pursuant to Section 3.01, any other obligation of
the Company or restrictive covenant added for the benefit of such series
pursuant to Section 3.01) ("covenant defeasance option") at any time after the
applicable conditions set forth below have been satisfied:

(1) The Company shall have deposited or caused to be deposited
irrevocably with the Trustee as trust funds in trust, specifically pledged
as security for, and dedicated solely to, the benefit of the Holders of the
Debt Securities of such series (i) money in an amount, or (ii) U.S.
Government Obligations (as defined below) which through the payment of
interest and principal in respect thereof in accordance with their terms
will provide, not later than one day before the due date of any payment,
money in an amount, or (iii) a combination of (i) and (ii), sufficient, in
the opinion (with respect to (i) and (ii)) of a nationally recognized firm
of independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge each installment of
principal (including any mandatory sinking fund payments) of and premium,
if any, and interest on, the Outstanding Debt Securities of such series on
the dates such installments of interest or principal and premium are due;

(2) Such deposit shall not cause the Trustee with respect to the Debt
Securities of that series to have a conflicting interest as defined in
Section 6.08 and for purposes of the Trust Indenture Act with respect to
the Debt Securities of any series;

(3) Such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Company is a party or by which it is bound;

(4) If the Debt Securities of such series are then listed on any
national securities exchange, the Company shall have delivered to the
Trustee an Opinion of Counsel or a letter or other document from such
exchange to the effect that the Company's exercise of its option under this
Section would not cause such Debt Securities to be delisted;

(5) No Event of Default or Default with respect to the Debt
Securities of such series shall have occurred and be continuing on the date
of such deposit and, with respect to the legal defeasance option only, no
Event of Default under Section 5.01(5) or Section 5.01(6) or event which
with the giving of notice or lapse of time, or both, would become an Event
of Default under Section 5.01(5) or Section 5.01(6) shall have occurred and
be continuing on the 91st day after such date; and

(6) The Company shall have delivered to the Trustee an Opinion of
Counsel or a ruling from the Internal Revenue Service to the effect that
the Holders of the Debt Securities of such series will not recognize
income, gain or loss for United States Federal income tax purposes as a
result of such deposit, defeasance or Discharge.

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Notwithstanding the foregoing, if the Company exercises its covenant defeasance
option and an Event of Default under Section 5.01(5) or Section 5.01(6) or event
which, with the giving of notice or lapse of time, or both, would become an
Event of Default under Section 5.01(5) or Section 5.01(6) shall have occurred
and be continuing on the 91st day after the date of such deposit, the
obligations of the Company referred to under the definition of covenant
defeasance option with respect to such Debt Securities shall be reinstated.

"Discharged" means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by, and obligations under, the
Debt Securities of such series and to have satisfied all the obligations under
this Indenture relating to the Debt Securities of such series (and the Trustee,
at the expense of the Company, shall execute proper instruments acknowledging
the same), except (A) the rights of Holders of Debt Securities of such series to
receive, from the trust fund described in clause (1) above, payment of the
principal of (and premium, if any) and interest on such Debt Securities when
such payments are due, (B) the Company's obligations with respect to the Debt
Securities of such series under Sections 3.04(a), 3.05, 3.06, 12.03 and 15.03
and (C) the rights, powers, trusts, duties and immunities of the Trustee
hereunder.

"U.S. Government Obligations" means securities that are (i) direct
obligations of the United States for the payment of which its full faith and
credit is pledged, or (ii) obligations of a Person controlled or supervised by
and acting as an agency or instrumentality of the United States the payment of
which is unconditionally guaranteed as a full faith and credit obligation by the
United States, which, in either case under clauses (i) or (ii), are not callable
or redeemable at the option of the issuer thereof, and shall also include a
depository receipt issued by a bank or trust company as custodian with respect
to any such U.S. Government Obligation or a specific payment of interest on or
principal of any such U.S. Government Obligation held by such custodian for the
account of the holder of a depository receipt; provided that (except as required
by law) such custodian is not authorized to make any deduction from the amount
payable to the holder of such depository receipt from any amount received by the
custodian in respect of the U.S. Government Obligation or the specific payment
of interest on or principal of the U.S. Government Obligation evidenced by such
depository receipt.

Section 15.03. DEPOSITED MONEYS AND U.S. GOVERNMENT OBLIGATIONS TO BE
HELD IN TRUST.

All moneys and U.S. Government Obligations deposited with the Trustee
pursuant to Section 15.02 in respect of Debt Securities of a series shall be
held in trust and applied by it, in accordance with the provisions of such 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 Holders of such Debt Securities, of all sums due
and to become due thereon for principal (and premium, if any) and interest, if
any, but such money need not be segregated from other funds except to the extent
required by law.

Section 15.04. REPAYMENT TO COMPANY.

The Trustee and any Paying Agent shall promptly pay or return to the
Company upon Company Request any moneys or U.S. Government Obligations held by
them at any time that are not required for the payment of the principal of (and
premium, if any) and interest on the Debt Securities of any series for which
money or U.S. Government Obligations have been deposited pursuant to Section
15.02.

The provisions of the last paragraph of Section 12.04 shall apply to
any money held by the Trustee or any Paying Agent under this Article that
remains unclaimed for two years after the

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Maturity of any series of Debt Securities for which money or U.S. Government
Obligations have been deposited pursuant to Section 15.02.

ARTICLE SIXTEEN

CONVERSION

Section 16.01. APPLICABILITY; CONVERSION PRIVILEGE.

Except as otherwise specified pursuant to Section 3.01 for Debt
Securities of any series, the provisions of this Article Sixteen shall be
applicable to any Debt Securities that are convertible into Common Stock. If so
provided pursuant to Section 3.01 with respect to the Debt Securities of any
series, the Holder of a Debt Security of such series shall have the right, at
such Holder's option, to convert, in accordance with the terms of such series of
Debt Securities and this Article Sixteen, all or any part (in a denomination of,
unless otherwise specified pursuant to Section 3.01 with respect to Debt
Securities of such series, $1,000 in principal amount or any integral multiple
thereof) of such Debt Security into shares of Common Stock or, as to any Debt
Securities called for redemption, at any time prior to the time and date fixed
for such redemption (unless the Company shall default in the payment of the
Redemption Price, in which case such right shall not terminate at such time and
date).

Section 16.02. CONVERSION PROCEDURE; CONVERSION PRICE; FRACTIONAL
SHARES.

(a) Each Debt Security to which this Article is applicable shall be
convertible at the office of the Conversion Agent, and at such other place or
places, if any, specified pursuant to Section 3.01 with respect to the Debt
Securities of such series, into fully paid and nonassessable shares (calculated
to the nearest 1/100th of a share) of Common Stock. The Debt Securities will be
converted into shares of Common Stock at the Conversion Price therefor. No
payment or adjustment shall be made in respect of dividends on the Common Stock
or accrued interest on a converted Debt Security except as described in
Section 16.09. The Company may, but shall not be required, in connection with
any conversion of Debt Securities, to issue a fraction of a share of Common
Stock and, if the Company shall determine not to issue any such fraction, the
Company shall, subject to Section 16.03(4), make a cash payment (calculated to
the nearest cent) equal to such fraction multiplied by the Closing Price of the
Common Stock on the last Trading Day prior to the date of conversion.

(b) Before any Holder of a Debt Security shall be entitled to convert
the same into Common Stock, such Holder shall surrender such Debt Security duly
endorsed to the Company or in blank, or, in the case of Bearer Securities,
together with all unmatured Coupons and any matured Coupons in default attached
thereto, at the office of the Conversion Agent or at such other place or places,
if any, specified pursuant to Section 3.01 (in the case of Registered
Securities) and at an office of the Conversion Agent or at such other place or
places, if any, outside of the United States as is specified pursuant to
Section 3.01 (in the case of Bearer Securities), and shall give written notice
to the Company at said office or place that such Holder elects to convert the
same and shall state in writing therein the principal amount of Debt Securities
to be converted and the name or names (with addresses) in which such Holder
wishes the certificate or certificates for Common Stock to be issued; PROVIDED,
HOWEVER, that no Debt Security or portion thereof shall be accepted for
conversion unless the principal amount of such Debt Security or such portion,
when added to the principal amount of all other Debt Securities or portions
thereof then being surrendered by the Holder thereof for conversion, exceeds the
then-effective Conversion Price with respect thereto. If the Holder of a Bearer
Security is unable to produce any such unmatured Coupon or Coupons or matured
Coupon or Coupons in default, then such

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conversion may be effected if the Bearer Securities to be surrendered for
conversion are accompanied by payment in funds acceptable to the Company in an
amount equal to the face amount of such missing Coupon or Coupons, or the
surrender of such missing Coupon or Coupons may be waived by the Company and the
Trustee if there is furnished to them such security or indemnity as they may
require to save each of them and any Paying Agent harmless. If thereafter the
Holder of such Bearer Security shall surrender to any Paying Agent any such
missing Coupon in respect of which such a payment shall have been made, then
such Holder shall be entitled to receive the amount of such payment; PROVIDED,
HOWEVER, that, except as otherwise provided in Section 12.03, interest
represented by Coupons shall be payable only upon presentation and surrender of
those Coupons at an office or agency located outside the United States. If more
than one Debt Security shall be surrendered for conversion at one time by the
same Holder, the number of full shares of Common Stock which shall be
deliverable upon conversion shall be computed on the basis of the aggregate
principal amount of the Debt Securities (or specified portions thereof to the
extent permitted thereby) so surrendered. Subject to the next succeeding
sentence, the Company will, as soon as practicable thereafter, issue and deliver
at said office or place to such Holder of a Debt Security, or to such Holder's
nominee or nominees, certificates for the number of full shares of Common Stock
to which such Holder shall be entitled as aforesaid, together, subject to the
last sentence of paragraph (a) above, with cash in lieu of any fraction of a
share to which such Holder would otherwise be entitled. The Company shall not
be required to deliver certificates for shares of Common Stock while the stock
transfer books for such stock or the Security Register are duly closed for any
purpose, but certificates for shares of Common Stock shall be issued and
delivered as soon as practicable after the opening of such books or Security
Register. A Debt Security shall be deemed to have been converted as of the
close of business on the date of the surrender of such Debt Security for
conversion as provided above, and the Person or Persons entitled to receive the
Common Stock issuable upon such conversion shall be treated for all purposes as
the record Holder or Holders of such Common Stock as of the close of business on
such date. In case any Debt Security shall be surrendered for partial
conversion, the Company shall execute and the Trustee shall authenticate and
deliver to or upon the written order of the Holder of the Debt Securities so
surrendered, without charge to such Holder (subject to the provisions of Section
16.08), a new Debt Security or Securities in authorized denominations in an
aggregate principal amount equal to the unconverted portion of the surrendered
Debt Security.

Section 16.03. ADJUSTMENT OF CONVERSION PRICE FOR COMMON STOCK.

The Conversion Price with respect to any Debt Security which is
convertible into Common Stock shall be adjusted from time to time as follows:

(1) In case the Company shall, at any time or from time to time while
any of such Debt Securities are outstanding, (i) pay a dividend in shares
of its Common Stock to holders of Common Stock, (ii) combine its
outstanding shares of Common Stock into a smaller number of shares of
Common Stock, (iii) subdivide its outstanding shares of Common Stock into a
greater number of shares of Common Stock or (iv) make a distribution in
shares of Common Stock to holders of Common Stock, then the Conversion
Price in effect immediately before such action shall be adjusted so that
the Holders of such Debt Securities, upon conversion thereof into Common
Stock immediately following such event, shall be entitled to receive the
kind and amount of shares of Common Stock of the Company which they would
have owned or been entitled to receive upon or by reason of such event if
such Debt Securities had been converted immediately before the record dated
(or, if no record date, the effective date) for such event. An adjustment
made pursuant to this Section 16.03(1) shall become effective retroactively
immediately after the record date in the case of a dividend or distribution
and shall become effective retroactively immediately after the effective
date in the case of a subdivision or combination. For the purposes of this
Section 16.03(1), each Holder of Debt Securities shall be

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deemed to have failed to exercise any right to elect the kind or amount of
securities receivable upon the payment of any such dividend, subdivision,
combination or distribution (PROVIDED, that if the kind or amount of
securities receivable upon such dividend, subdivision, combination or
distribution is not the same for each nonelecting share, then the kind and
amount of securities or other property receivable upon such dividend,
subdivision, combination or distribution for each nonelecting share shall
be deemed to be the kind and amount so receivable per share by a plurality
of the nonelecting shares).

(2) In case the Company shall, at any time or from time to time while
any of such Debt Securities are outstanding, issue rights or warrants to
all holders of shares of its Common Stock entitling them (for a period
expiring within 45 days after the record date for such issuance) to
subscribe for or purchase shares of Common Stock (or securities convertible
into shares of Common Stock) at a price per share less than the Current
Market Price of the Common Stock at such record date (treating the price
per share of the securities convertible into Common Stock as equal to (x)
the sum of (i) the price for a unit of the security convertible into Common
Stock and (ii) any additional consideration initially payable upon the
conversion of such security into Common Stock divided by (y) the number of
shares of Common Stock initially underlying such convertible security), the
Conversion Price with respect to such Debt Securities shall be adjusted so
that it shall equal the price determined by dividing the Conversion Price
in effect immediately prior to the date of issuance of such rights or
warrants by a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding on the date of issuance of such rights
or warrants plus the number of additional shares of Common Stock offered
for subscription or purchase (or into which the convertible securities so
offered are initially convertible), and the denominator of which shall be
the number of shares of Common Stock outstanding on the date of issuance of
securities which the aggregate offering price of the total number of shares
of securities so offered for subscription or purchase (or the aggregate
purchase price of the convertible securities so offered plus the aggregate
amount of any additional consideration initially payable upon conversion of
such securities into Common Stock) would purchase at such Current Market
Price of the Common Stock. Such adjustment shall become effective
retroactively immediately after the record date for the determination of
stockholders entitled to receive such rights or warrants.

(3) In the case the Company shall, at any time or from time to time
while any of such Debt Securities are outstanding, distribute to all
holders of shares of its Common Stock (including any such distribution made
in connection with a consolidation or merger in which the Company is the
continuing corporation and the Common Stock is not changed or exchanged)
cash, evidences of its indebtedness, securities or assets (excluding (i)
regular periodic cash dividends in amounts, if any, determined from time to
time by the Board of Directors, (ii) dividends payable in shares of Common
Stock for which adjustment is made under Section 16.03(1) or (iii) rights
or warrants to subscribe for or purchase securities of the Company
(excluding those referred to in Section 16.03(2)), then in each such case
the Conversion Price with respect to such Debt Securities determined by
dividing the Conversion Price in effect immediately prior to the date of
such distribution by a fraction, the numerator of which shall be the
Current Market Price of the Common Stock on the record date referred to
below, and the denominator of which shall be such Current Market Price of
the Common Stock less the then fair market value (as determined by the
Board of Directors of the Company, whose determination shall be conclusive)
of the portion of the cash or assets or evidences of indebtedness or
securities so distributed or of such subscription rights or warrants
applicable to one share of Common Stock (PROVIDED that such denominator
shall never be less than 1.0); PROVIDED, HOWEVER, that no adjustment shall
be made with respect to any distribution of rights to purchase securities
of the Company if a Holder of

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Debt Securities would otherwise be entitled to receive such rights upon
conversion at any time of such Debt Securities into Common Stock unless
such rights are subsequently redeemed by the Company, in which case such
redemption shall be treated for purposes of this Section as a dividend on
the Common Stock. Such adjustment shall become effective retroactively
immediately after the record date for the determination of stockholders
entitled to receive such distribution; and in the event that such
distribution is not so made, the Conversion Price shall again be adjusted
to the Conversion Price which would then be in effect if such record date
had not been fixed.

(4) The Company shall be entitled to make such additional adjustments
in the Conversion Price, in addition to those required by subsections
16.03(1), 16.03(2), and 16.03(03), as shall be necessary in order that any
dividend or distribution of Common Stock, any subdivision, reclassification
or combination of shares of Common Stock or any issuance of rights or
warrants referred to above shall not be taxable to the holders of Common
Stock for United States Federal income tax purposes.

(5) In any case in which this Section 16.03 shall require that any
adjustment be made effective as of or retroactively immediately following a
record date, the Company may elect to defer (but only for five (5) Trading
Days following the filing of the statement referred to in Section 16.05)
issuing to the Holder of any Debt Securities converted after such record
date the shares of Common Stock and other capital stock of the Company
issuable upon such conversion over and above the shares of Common Stock and
other capital stock of the Company issuable upon such conversion on the
basis of the Conversion Price prior to adjustment; PROVIDED, HOWEVER, that
the Company shall deliver to such Holder a due bill or other appropriate
instrument evidencing such Holder's right to receive such additional shares
upon the occurrence of the event requiring such adjustment.

(6) All calculations under this Section 16.03 shall be made to the
nearest cent or one-hundredth of a share of security, with one-half cent
and 0.005 of a share, respectively, being rounded upward. Notwithstanding
any other provision of this Section 16.03, the Company shall not be
required to make any adjustment of the Conversion Price unless such
adjustment would require an increase or decrease of at least 1% of such
price. Any lessor adjustment shall be carried forward and shall be made at
the time of, and together with, the next subsequent adjustment which,
together with any adjustment or adjustments so carried forward, shall
amount to an increase or decrease of at least 1% in such price. Any
adjustments under this Section 16.03 shall be made successively whenever an
event requiring such an adjustment occurs.

(7) In the event that at any time, as a result of an adjustment made
pursuant to this Section 16.03, the Holder of any Debt Security thereafter
surrendered for conversion shall become entitled to receive any shares of
stock of the Company other than shares of Common Stock into which the Debt
Securities originally were convertible, the Conversion Price of such other
shares so receivable upon conversion of any such Debt Security shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to Common Stock
contained in subparagraphs (1) through (6) of this Section 16.03, and the
provisions of Sections 16.01, 16.02 and 16.04 through 16.09 with respect to
the Common Stock shall apply on like or similar terms to any such other
shares and the determination of the Board of Directors as to any such
adjustment shall be conclusive.

(8) No adjustment shall be made pursuant to this Section: (i) if the
effect thereof would be to reduce the Conversion Price below the par value
(if any) of the Common Stock or

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(ii) subject to 16.03(5) hereof, with respect to any Debt Security that is
converted prior to the time such adjustment otherwise would be made.

Section 16.04. CONSOLIDATION OR MERGER OF THE COMPANY.

In case of either (a) any consolidation or merger to which the Company
is a party, other than a merger or consolidation in which the company is the
surviving or continuing corporation and which does not result in a
reclassification of, or change (other than a change in par value or from par
value to no par value or from no par value to par value, as a result of a
subdivision or combination) in, outstanding shares of Common Stock or (b) any
sale or conveyance of all or substantially all of the property and assets of the
Company to another Person, each Debt Security then outstanding shall be
convertible from and after such merger, consolidation, sale or conveyance of
property and assets into the kind and amount of shares of stock or other
securities and property (including cash) receivable upon such consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
into which such Debt Securities would have been converted immediately prior to
such consolidation, merger, sale or conveyance, subject to adjustments which
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Article Sixteen (and assuming such holder of Common Stock failed to
exercise his rights of election, if any, as to the kind or amount of securities,
cash or other property (including cash) receivable upon such consolidation,
merger, sale or conveyance (provided that, if the kind or amount of securities,
cash or other property (including cash) receivable upon such consolidation,
merger, sale or conveyance is not the same for each nonelecting share, then the
kind and amount of securities, cash or other property (including cash)
receivable upon such consolidation, merger, sale or conveyance for each
nonelecting share shall be deemed to be the kind and amount so receivable per
share by a plurality of the nonelecting shares or securities)). The Company
shall not enter into any of the transactions referred to in clause (a) or (b) of
the preceding sentence unless effective provision shall be made so as to give
effect to the provisions set forth in this Section 16.04. The provisions of
this Section 16.04 shall apply similarly to successive consolidations, mergers,
sales or conveyances.

Section 16.05. NOTICE OF ADJUSTMENT.

Whenever an adjustment in the Conversion Price with respect to a
series of Debt Securities is required:

(1) the Company shall forthwith place on file with the Trustee and
any Conversion Agent for such Securities a certificate of the Treasurer of
the Company, stating the adjusted Conversion Price determined as provided
herein and setting forth in reasonable detail such facts as shall be
necessary to show the reason for and the manner of computing such
adjustment, such certificate to be conclusive evidence that the adjustment
is correct; and

(2) a notice stating that the Conversion Price has been adjusted and
setting forth the adjusted Conversion Price shall forthwith be given by the
Company, or at the Company's request, by the Trustee in the name and at the
expense of the Company, in the manner PROVIDED in Section 1.05. Any notice
so given shall be conclusively presumed to have been duly given, whether or
not the Holder receives such notice.

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Section 16.06. NOTICE IN CERTAIN EVENTS.

IN CASE:

(1) of a consolidation or merger to which the Company is a party and
for which approval of any stockholders of the Company is required, or of
the sale or conveyance to another Person or entity or group of Persons or
entities acting in concert as a partnership, limited partnership, syndicate
or other group (within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, as amended) of all or substantially all of the
property and assets of the Company; or

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

(3) of any action triggering an adjustment of the Conversion Price
pursuant to this Article Sixteen;

then, in each case, the Company shall cause to be filed with the Trustee and the
Conversion Agent for the applicable Debt Securities, and shall cause to be
given, to the Holders of record of applicable Debt Securities in the manner
provided in Section 1.05, at least fifteen (15) days prior to the applicable
date hereinafter specified, a notice stating (x) the date on which a record is
to be taken for the purpose of any distribution or grant of rights or warrants
triggering an adjustment to the Conversion Price pursuant to this Article
Sixteen, or, if a record is not to be taken, the date as of which the holders of
record or Common Stock entitled to such distribution, rights or warrants are to
be determined, or (y) the date on which any reclassification, consolidation,
merger, sale, conveyance, dissolution, liquidation or winding up triggering an
adjustment to the Conversion Price pursuant to this Article Sixteen is expected
to become effective, and the date as of which it is expected that holders of
Common Stock of record shall be entitled to exchange their Common Stock for
securities or other property deliverable upon such reclassification,
consolidation, merger, sale, conveyance, dissolution, liquidation or winding up.

Failure to give such notice or any defect therein shall not affect the
legality or validity of the proceedings described in clause (1), (2), or (3) of
this Section.

Section 16.07. COMPANY TO RESERVE STOCK; REGISTRATION; LISTING.

(a) The Company shall at all times reserve and keep available, free
from preemptive rights, out of its authorized but unissued shares of Common
Stock, for the purpose of effecting the conversion of the Debt Securities, such
number of its duly authorized shares of Common Stock as shall from time to time
be sufficient to effect the conversion of all applicable outstanding Debt
Securities into such Common Stock at any time (assuming that, at the time of the
computation of such number of shares or securities, all such Debt Securities
would be held by a single holder); PROVIDED, HOWEVER, that nothing contained
herein shall preclude the Company from satisfying its obligations in respect of
the conversion of the Debt Securities by delivery of purchased shares of Common
Stock which are held in the treasury of the Company. The Company shall from
time to time, in accordance with the laws of the State of Delaware, use its best
efforts to cause the authorized amount of the Common Stock to be increased if
the aggregate of the authorized amount of the Common Stock remaining unissued
and the issued shares of such Common Stock in its treasury (other than any such
shares reserved for issuance in any other connection) shall not be sufficient to
permit the conversion of all Debt Securities.

86
<PAGE>

(b) If any shares of Common Stock which would be issuable upon
conversion of Debt Securities hereunder require registration with or approval of
any governmental authority before such shares or securities may be issued upon
such conversion, the Company will in good faith and as expeditiously as possible
endeavor to cause such shares or securities to be duly registered or approved,
as the case may be. The Company will endeavor to list the shares of Common
Stock required to be delivered upon conversion of the Debt Securities prior to
such delivery upon the principal national securities exchange upon which the
outstanding Common Stock is listed at the time of such delivery.

Section 16.08. TAXES ON CONVERSION.

The Company shall pay any and all documentary, stamp or similar issue
or transfer taxes that may be payable in respect of the issue or delivery of
shares of Common Stock on conversion of Debt Securities pursuant hereto. The
Company shall not, however, be required to pay any such tax which may be payable
in respect of any transfer involved in the issue or delivery of shares of Common
Stock or the portion, if any, of the Debt Securities which are not so converted
in a name other than that in which the Debt Securities so converted were
registered (in case of Registered Securities), and no such issue or delivery
shall be made unless and until the Person requesting such issue has paid to the
Company the amount of such tax or has established to the satisfaction of the
Company that such tax has been paid.

Section 16.09. CONVERSION AFTER RECORD DATE.

If any Debt Securities are surrendered for conversion subsequent to
the record date preceding an Interest Payment Date but on or prior to such
Interest Payment Date (except Debt Securities called for redemption on a
Redemption Date between such record date and Interest Payment Date), the Holder
of such Debt Securities at the close of business on such record date shall be
entitled to receive the interest payable on such Debt Securities on such
Interest Payment Date notwithstanding the conversion thereof. Debt Securities
surrendered for conversion during the period from the close of business on any
record date next preceding any Interest Payment Date to the opening of business
on such Interest Payment Date shall (except in the case of Debt Securities which
have been called for redemption on a Redemption Date within such period) be
accompanied by payment in New York Clearing House funds or other funds and in
the Currency acceptable to the Company of an amount equal to the interest
payable on such Interest Payment Date on the Debt Securities being surrendered
for conversion. Except as provided in this Section 16.09, no adjustments in
respect of payments of interest on Debt Securities surrendered for conversion or
any dividends or distributions of interest on the Common Stock issued upon
conversion shall be made upon the conversion of any Debt Securities.

Section 16.10. COMPANY DETERMINATION FINAL.

Any determination that the Company or the Board of Directors must make
pursuant to this Article is conclusive.

Section 16.11. TRUSTEE'S DISCLAIMER.

The Trustee has no duty to determine when an adjustment under this
Article should be made, how it should be made or what it should be. The Trustee
makes no representation as to the validity or value of any securities or assets
issued upon conversion of Debt Securities. The Trustee shall not be responsible
for the Company's failure to comply with this Article. Each Conversion Agent
other than the Company shall have the same protection under this Section as the
Trustee.

87
<PAGE>

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

HILTON HOTELS CORPORATION

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

[SEAL]

Attest:

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

[NAME OF TRUSTEE], as Trustee

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

[SEAL]

Attest:

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

88
<PAGE>

STATE OF )
: ss.:
COUNTY OF )

On the _____ day of _____________, 19__, before me _____________________
personally appeared ________________________________________________, personally
known to me or proved to me on the basis of satisfactory evidence to be the
person(s) who name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.

Witness my hand and official seal.

------------------------------------------------
Notary Public

SEAL

89
<PAGE>

STATE OF )
: ss.:
COUNTY OF )

Witness my hand and official seal.

------------------------------------------------
Notary Public

SEAL

<PAGE>

EXHIBIT A

[FORM OF REDEEMABLE OR NONREDEEMABLE DEBT SECURITY]
[FACE OF DEBT SECURITY]

THIS DEBT SECURITY IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS DEBT SECURITY MAY NOT BE TRANSFERRED TO, OR REGISTERED OR
EXCHANGED FOR SECURITIES REGISTERED IN THE NAME OF, ANY PERSON OTHER THAN THE
DEPOSITARY OR A NOMINEE THEREOF AND NO SUCH TRANSFER MAY BE REGISTERED, EXCEPT
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY DEBT SECURITY
AUTHENTICATED AND DELIVERED UPON REGISTRATION OF TRANSFER OF, OR IN EXCHANGE FOR
OR IN LIEU OF, THIS DEBT SECURITY SHALL BE A GLOBAL NOTE SUBJECT TO THE
FOREGOING, EXCEPT IN SUCH LIMITED CIRCUMSTANCES.

[IF THIS DEBT SECURITY IS AN ORIGINAL ISSUE DISCOUNT DEBT SECURITY,
INSERT-- FOR PURPOSES OF SECTIONS 1273 AND 1275 OF THE UNITED STATES INTERNAL
REVENUE CODE, THE AMOUNT OF ORIGINAL ISSUE DISCOUNT ON THIS DEBT SECURITY IS
_____% OF ITS PRINCIPAL AMOUNT, THE ISSUE DATE IS __________, 19__ [AND] THE
YIELD TO MATURITY IS ____ %. [THE METHOD USED TO DETERMINE THE AMOUNT OF
ORIGINAL ISSUE DISCOUNT APPLICABLE TO THE SHORT ACCRUAL PERIOD OF __________,
19__ TO ________, 19__, IS ____% OF THE PRINCIPAL AMOUNT OF THIS DEBT SECURITY.]

HILTON HOTELS CORPORATION
[DESIGNATION OF SERIES]

No.__________ $__________

HILTON HOTELS CORPORATION, a Delaware corporation (herein referred to as
the "Company," which term includes any successor corporations under the
Indenture referred to on the reverse hereof), for value received, hereby
promises to pay to _____________________ or registered assigns the principal sum
of _____________________ Dollars on ___________ (the "Stated Maturity Date") [OR
INSERT DATE FIXED FOR EARLIER REDEMPTION (the "Redemption Date") and, together
with the Stated Maturity Date with respect to principal repayable on such date,
the "Maturity Date")].

[IF THE DEBT SECURITY IS TO BEAR INTEREST PRIOR TO MATURITY, INSERT--and to
pay interest thereon from _____________________ or from the most recent interest
payment date to which interest has been paid or duly provided for, semi-annually
on _________________ and ________________ in each year (each, an "Interest
Payment Date"), commencing _________________, at the rate of _____% per annum,
until the principal hereof is paid or duly provided for. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will, as provided in such Indenture, be paid to the Holder in whose name this
Debt Security (or one or more Predecessor Securities) is registered at the close
of business on the Regular Record Date for such interest, which shall be the
_______________ or _______________ (whether or not a Business Day, as defined
below), as the case may be, next preceding such Interest Payment Date [at the
office or agency of the Company maintained for such purpose; PROVIDED, HOWEVER,
that such interest may be paid, at the Company's

A-1
<PAGE>

option, by mailing a check to such Holder at his or her registered address or by
transfer of funds to an account maintained by such Holder within the United
States]. Any such interest not so punctually paid or duly provided for shall
forthwith cease to be payable to the Holder on such Regular Record Date, and may
be paid to the Holder in whose name this Debt Security (or one or more
Predecessor Debt Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Debt Securities of this
series not less than 10 days prior to such Special Record Date, or may be paid
at any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Debt Securities of this series may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in the Indenture. Interest will be computed on the basis of a
360-day year of twelve 30-day months.]

[IF THE DEBT SECURITY IS NOT TO BEAR INTEREST PRIOR TO MATURITY, INSERT--
The principal of this Debt Security shall not bear interest except in the case
of a default in payment of principal upon acceleration, upon redemption or at
the [Stated] Maturity Date and in such case the overdue principal of this Debt
Security shall bear interest at the rate of _________% per annum (to the extent
that the payment of such interest shall be legally enforceable), which shall
accrue from the date of such default in payment to the date payment of such
principal has been made or duly provided for. Interest on any overdue principal
shall be payable on demand. Any such interest on any overdue principal that is
not so paid on demand shall bear interest at the rate of _____% per annum (to
the extent that the payment of such interest shall be legally enforceable),
which shall accrue from the date of such demand for payment to the date payment
of such interest has been made or duly provided for, and such interest shall
also be payable on demand.]

The principal of this Debt Security payable on the [Stated] Maturity Date
[or the principal of, premium, if any, and, if the Redemption Date is not an
Interest Payment Date, interest on this Debt Security payable on the Redemption
Date] will be paid against presentation of this Debt Security at the office or
agency of the Company maintained for that purpose in ____________, in such coin
or currency of the United States as at the time of payment is legal tender for
the payment of public and private debts.

Interest payable on this Debt Security on any Interest Payment Date and on
the [Stated] Maturity Date [or Redemption Date, as the case may be,] will
include interest accrued from and including the next preceding Interest Payment
Date in respect of which interest has been paid or duly provided for (or from
and including ____________, if no interest has been paid on this Debt Security)
to but excluding such Interest Payment Date or the [Stated] Maturity Date [or
Redemption Date, as the case may be]. If any Interest Payment Date or the
[Stated] Maturity Date [or Redemption Date] falls on a day that is not a
Business Day, principal, premium, if any, and/or interest payable with respect
to such Interest Payment Date or [Stated] Maturity Date [or Redemption Date, as
the case may be,] will be paid on the next succeeding Business Day with the same
force and effect as if it were paid on the date such payment was due, and no
interest shall accrue on the amount so payable for the period from and after
such Interest Payment Date or [Stated] Maturity Date [or Redemption Date, as the
case may be]. "Business Day" means any day, other than a Saturday or Sunday, on
which banks in [New York] are not required or authorized by law or executive
order to close.

[IF THIS DEBT SECURITY IS A GLOBAL DEBT SECURITY, INSERT--All payments of
principal, premium, if any, and interest in respect of this Debt Security will
be made by the Company in immediately available funds.]

A-2
<PAGE>

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

Unless the Certificate of Authentication hereon has been executed by the
Trustee by manual signature of one of its authorized signatories, this Debt
Security shall not be entitled to any benefit under the Indenture, or be valid
or obligatory for any purpose.

IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its [facsimile] corporate seal.

Dated _________________ HILTON HOTELS CORPORATION

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

Attest:

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

A-3
<PAGE>

[Reverse of Debt Security]

HILTON HOTELS CORPORATION

This Debt Security is one of a duly authorized issue of securities of the
Company, issued and to be issued in one or more series under an Indenture, dated
as of ___________, 199__ (herein called the "Indenture") between the Company and
__________________, as Trustee (herein called the "Trustee," which term includes
any successor trustee under the Indenture with respect to the series of which
this Debt Security is a part), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company,
the Trustee and the Holders of the Debt Securities, and of the terms upon which
the Debt Securities are, and are to be, authenticated and delivered. This Debt
Security is one of the duly authorized series of Debt Securities designated on
the face hereof (collectively, the "Debt Securities"), [IF APPLICABLE, INSERT--
and the aggregate principal amount of the securities to be issued under such
series is limited to $________ (except for Debt Securities authenticated and
delivered upon transfer of, or in exchange for, or in lieu of other Debt
Securities).] All terms used in this Debt Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.

If an Event of Default shall occur and be continuing, the principal of the
Debt Securities of this series may be declared due and payable in the manner and
with the effect PROVIDED in the Indenture.

[IF APPLICABLE, INSERT--The Debt Securities may not be redeemed prior to
the [Stated] Maturity Date.]

[IF APPLICABLE, INSERT--The Debt Securities are subject to redemption [(a)
[IF APPLICABLE, INSERT--on ______________ in any year commencing with the year
____ and ending with the year ____ through operation of the sinking fund for
this series at a Redemption Price equal to 100% of the principal amount and (b)]
[IF APPLICABLE, INSERT--at any time [on or after _______________], as a whole or
in part, at the election of the Company, at the following Redemption Prices
(expressed as percentages of the principal amount): If redeemed on or before
___________, ____% and if redeemed during the 12-month period beginning
______________ of the years indicated, at the Redemption Prices indicated below.

Year Redemption Price Year Redemption Price
---- ---------------- ---- ----------------

and thereafter at a Redemption Price equal to ____% of the principal amount,
together, in the case of any such redemption [IF APPLICABLE, INSERT--(whether
through operation of the sinking fund or otherwise)], with accrued interest to
the Redemption Date; PROVIDED, HOWEVER, that installments of interest on this
Debt Security whose Stated Maturity is on or prior to such Redemption Date will
be payable to the Holder of this Debt Security, or one or more Predecessor Debt
Securities, of record at the close of business on the relevant Record Dates
referred to on the face hereof, all as provided in the Indenture.]

[IF APPLICABLE, INSERT--The Debt Securities are subject to redemption (a)
on ____________ in any year commencing with the year ____ and ending with the
year through operation of the sinking fund for this series at the Redemption
Prices for redemption through operation of the sinking fund (expressed as
percentages of the principal amount) set forth in the table below and (b) at any
time on or after __________], as a whole or in part, at the election of the
Company, at the Redemption Prices for

A-4
<PAGE>

redemption otherwise than through operation of the sinking fund (expressed as
percentages of the principal amount) set forth in the table below: If redeemed
during the 12-month period beginning of the years indicated,

Redemption Price for Redemption Price for
Redemption Through Redemption Otherwise Than
Operation of the Through Operation of
Year Sinking Fund the Sinking Fund
---- ------------ ----------------

and thereafter at a Redemption Price equal to ___% of the principal amount,
together, in the case of any such redemption (whether through operation of the
sinking fund or otherwise), with accrued interest to the Redemption Date;
PROVIDED, HOWEVER, that installments of interest on this Debt Security whose
Stated Maturity is on or prior to such Redemption Date will be payable to the
Holder of this Debt Security, or one or more Predecessor Debt Securities, of
record at the close of business on the relevant record dates referred to on the
face hereof, all as provided in the Indenture.]

[IF APPLICABLE, INSERT--Notwithstanding the foregoing, the Company may not,
prior to __________ redeem any Debt Securities as contemplated by [clause (2)
of] the preceding paragraph as a part of, or in anticipation of, any refunding
operation by the application, directly or indirectly, of money borrowed having
an interest cost to the Company (calculated in accordance with generally
accepted financial practice) of less than ____% per annum.]

[IF APPLICABLE, INSERT--The sinking fund for the Debt Securities provides
for the redemption on __________ in each year, beginning with the year ____ and
ending with the year ____, of [not less than] $___] [("mandatory sinking fund")
and not more than $_______] aggregate principal amount of the Debt Securities.
[The Debt Securities acquired or redeemed by the Company otherwise than through
[mandatory] sinking fund payments may be credited against subsequent [mandatory]
sinking fund payments otherwise required to be made in the [DESCRIBE ORDER]
order in which they become due.]]

Notice of redemption will be given by mail to Holders of Debt Securities,
not less than 30 nor more than 60 days prior to the Redemption Date, all as
provided in the Indenture.

In the event of redemption of the Debt Security in part only, a new Debt
Security or Debt Securities for the unredeemed portion hereof shall be issued in
the name of the Holder hereof upon the cancellation hereof.

[IF APPLICABLE, INSERT CONVERSION PROVISIONS SET FORTH IN ANY BOARD
RESOLUTION OR INDENTURE SUPPLEMENTAL TO THE INDENTURE.]

The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Debt Securities under the Indenture
at any time by the Company and the Trustee with the consent of the Holders of
not less than at least a majority of the aggregate principal amount of all Debt
Securities issued under the indenture at the time Outstanding and affected
thereby. The Indenture also contains provisions

A-5
<PAGE>

permitting the Holders of not less than at least a majority of the aggregate
principal amount of the Outstanding Debt Securities, on behalf of the Holders of
all such Debt Securities, to waive compliance by the Company with certain
provisions of the Indenture. Furthermore, provisions in the Indenture permit
the Holders of not less than at least a majority of the aggregate principal
amount, in certain instances, of the Outstanding Debt Securities of any series
to waive, on behalf of all of the Holders of Debt Securities of such series,
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Debt Security shall be conclusive and
binding upon such Holder and upon all future Holders of this Debt Security and
other Debt Securities issued upon the registration of transfer hereof or in
exchange herefor or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Debt Security.

No reference herein to the Indenture and no provision of this Debt Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Debt Security at the times, rates and in the coin or currency,
herein prescribed.

As provided in the Indenture and subject to certain limitations therein
[and herein] set forth, the transfer of this Debt Security is registrable in the
Security Register of the Company upon surrender of this security for
registration of transfer at the office or agency of the Company in any place
where the principal of (and premium, if any) and interest on this Debt Security
are payable, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the Holder hereof or by his attorney duly authorized in writing,
and thereupon one or more new Debt Securities, of authorized denominations and
for the same aggregate principal amount, will be issued to the designated
transferee or transferees.

As provided in the Indenture and subject to certain limitations therein
[and herein] set forth, this Debt Security is exchangeable for a like aggregate
principal amount of Debt Securities of different authorized denominations but
otherwise having the same terms and conditions, as requested by the Holder
hereof surrendering the same.

The Debt Securities of this series are issuable only in registered form
[without coupons] in denominations of $________ and any integral multiple
thereof. No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.

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

No recourse shall be had for the payment of the principal of or premium, if
any, or the interest on this Debt Security, or for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the Indenture or any
indenture supplemental thereto, against any past, present or future
incorporator, stockholder, employee, officer or director, as such, of the
Company or of any successor or Affiliate of the Company, either directly or
through the Company or any successor, whether by virtue of any constitution,
statute or rule of law or by the enforcement of any assessment or penalty or
otherwise, all such liability being, by the acceptance hereof and as part of the
consideration for the issue hereof, expressly waived and released.

A-6
<PAGE>

The Indenture and the Debt Securities shall be governed by and construed in
accordance with the laws of the State of New York applicable to agreements made
and to be performed entirely in such State.

TRUSTEE'S CERTIFICATE OF AUTHENTICATION

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

[NAME OF TRUSTEE], as Trustee

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

A-7
<PAGE>

EXHIBIT B
[FORM OF COUPON]

[FACE OF COUPON]

[INSERT ANY LEGEND REQUIRED BY THE INTERNAL REVENUE CODE AND THE
REGULATIONS THEREUNDER.]

No.__________

ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO
LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS
PROVIDED IN SECTIONS 165(j) AND 1287 (a) OF THE INTERNAL REVENUE CODE.

On the [_____] Interest Payment Date

[_________________]

HILTON HOTELS CORPORATION (the "Company") will pay to bearer, upon surrender
hereof, the interest payable with respect to above-referenced Interest Payment
Date on its [Name of the Debt Securities] with the certificate number set forth
below, together with any additional amounts which may be payable under the terms
of the Debt Security, unless the Debt Security shall have been previously called
for redemption or submitted for repayment and sums for such redemption or
repayment duly provided. Payment of this coupon will be made in the currency
set forth on the face of such Debt Security upon surrender hereof, subject to
applicable laws and regulations, only (subject to certain limited exceptions set
forth in such Debt Security) at such paying agencies outside the United States
and its possessions as the Company may appoint from time to time. Such payments
will be made, at the option of the bearer, by check mailed or delivered to an
address outside the United States and its possessions furnished by such bearer
or by payment to an account maintained by the payee with a bank located outside
the United States. [This coupon will become void unless presented for payment
within [___] years from the due date hereof.] Reference is made to the Debt
Security for definitions of terms used herein.

Hilton Hotels Corporation

By:

Certificate Number:

[Reverse of Coupon]

Paying Agencies (subject to change)

B-1
<PAGE>

EXHIBIT C

[FORMS OF CERTIFICATION]

[FORM OF CERTIFICATE TO BE GIVEN BY
PERSON ENTITLED TO RECEIVE BEARER SECURITY
OR INTEREST PRIOR TO AN EXCHANGE DATE]

CERTIFICATE
------------------------
[Insert title or sufficient description
of Debt Securities to be delivered]

This is to certify that as of the date hereof and except as set forth
below principal amount of the above captioned Debt Securities held by
you for our account (i) is owned by person(s) that are not United States
person(s) (as defined below), (ii) is owned by United States person(s) that are
(a) foreign branches of United States financial institutions (as defined in
Section 1.165-12(c)(1)(v) of the United States Treasury regulations) ("financial
institutions") purchasing for their own account or for resale, or (b) United
States person(s) who acquired the Debt Securities through foreign branches of
United States financial institutions and who hold the Debt Securities through
such United States financial institutions on the date hereof (and in either case
(a) or (b), each such United States financial institution hereby agrees, on its
own behalf or through its agent, that you may advise the Company or the
Company's agent that it will comply with the requirements of Section
165(j)(3)(A), (B) or (C) of the United States Internal Revenue Code of 1986, as
amended, and the Treasury regulations thereunder), or (iii) is owned by United
States or foreign financial institution(s) for the purpose of resale during the
restricted period (as defined in Section 1.163-5(c)(2)(i)(D)(7) of the United
States Treasury regulations), and in addition if the owner of the Debt
Securities is a United States or foreign financial institution described in
clause (iii) above (whether or not also described in clause (i) or (ii)) this is
to further certify that such financial institution has not acquired the Debt
Securities for the purpose of resale directly or indirectly to a United States
person or to a person within the United States or its possessions.

We undertake to advise you promptly by tested telex on or prior to the
date on which you intend to submit your certification relating to the beneficial
interest in the temporary global Debt Security held by you for our account in
accordance with your operating procedures if any applicable statement herein is
not correct on such date, and in the absence of any such notification it may be
assumed that this certification applies as of such date.

This certificate excepts and does not relate to ________ principal
amount of Debt Securities held by you for our account as to which we are not
able to provide a certificate in this form. We understand that exchange of such
portion of the temporary Global Note for definitive Bearer Securities or
interests in a permanent Global Note cannot be made until we are able to provide
a certificate in this form.

We understand that this certificate is required in connection with
certain tax laws and regulations of the United States. If administrative or
legal proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate or a copy thereof to any interested party in such proceedings.

C-1
<PAGE>

"United States person" means any citizen or resident of the United
States, any corporation, partnership or other entity created or organized in or
under the laws of the United States and any estate or trust the income of which
is subject to United States federal income taxation regardless of its source.
"United States" means the United States of America (including the States and the
District of Columbia), its territories and possessions and other areas subject
to its jurisdiction.

Dated: , 19
------------------------ --
[To be dated no earlier than the
10th day before the Exchange Date]

By:
--------------------------------
As, or as agent for, the
beneficial owner(s) of
the portion of the
temporary global Note
to which this
certificate relates.

C-2
<PAGE>

EXHIBIT D

[FORM OF CERTIFICATE TO BE GIVEN BY EURO-CLEAR AND
CEDEL, S.A. IN CONNECTION WITH THE EXCHANGE OF
A PORTION OF A TEMPORARY GLOBAL NOTE]

CERTIFICATE
------------------------
[Insert title or sufficient description
of Debt Securities to be delivered]

The undersigned certifies that, based solely on certifications we have
received in writing, by tested telex or by electronic transmission from member
organizations appearing in our records as persons being entitled to a portion of
the principal amount set forth below (our "Member Organizations") substantially
to the effect set forth in the Indenture as of the date hereof, _________
principal amount of the above-captioned Debt Securities (i) is owned by
person(s) that are not United States person(s) (as defined below), (ii) is owned
by United States person(s) that are (a) foreign branches of United States
financial institutions (as defined in Section 1.165-12(c)(1)(v) of the United
States Treasury regulations) ("financial institutions") purchasing for their own
account or for resale, or (b) United States person(s) who acquired the Debt
Securities through foreign branches of United States financial institutions and
who hold the Debt Securities through such United States financial institutions
on the date hereof (and in either case (a) or (b), each such United States
financial institution has agreed, on its own behalf or through its agent, that
we may advise the Company or the Company's agent that it will comply with the
requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of
1986, as amended, and the Treasury regulations thereunder), or (iii) is owned by
United States or foreign financial institution(s) for the purpose of resale
during the restricted period (as defined in Section 1.163-5(c)(2)(i)(D)(7) of
the United States Treasury regulations), and in addition United States or
foreign financial institutions described in clause (iii) above (whether or not
also described in clause (i) or (ii)) have certified that they have not acquired
the Debt Securities for the purpose of resale directly or indirectly to a United
States person or to a person within the United States or its possessions.

We further certify (i) that we are not making available for exchange
or collection of any interest any portion of the temporary Global Note excepted
in such certifications and (ii) that as of the date hereof we have not received
any notification from any of our Member Organizations to the effect that the
statements made by such Member Organizations with respect to any portion of the
part submitted herewith for exchange or collection of any interest are no longer
true and cannot be relied upon as of the date hereof.

D-1
<PAGE>

Dated: , 19
------------------------ --
[To be dated no earlier than the
Exchange Date]

By:
----------------------------------------
[MORGAN GUARANTY TRUST
COMPANY OF NEW YORK,
BRUSSELS OFFICE, as
Operator of the Euro-Clear
System] [CEDEL, S.A.]

D-2

<PAGE>

Exhibit 5.1

[Latham & Watkins Letterhead]

December 20, 1996

Hilton Hotels Corporation
9336 Civic Center Drive
Beverly Hills, California 90210

Re: Hilton Hotels Corporation
$1,000,000,000 Aggregate Offering Price
of Securities of Hilton Hotels Corporation
------------------------------------------

Ladies and Gentlemen:

At your request, we have examined the registration statement on Form S-3
(the "Registration Statement") being filed by Hilton Hotels Corporation (the
"Company") with the Securities and Exchange Commission (the "Commission")
under the Securities Act of 1933, as amended, relating to the offering from
time to time, as set forth in the prospectus contained in the Registration
Statement (the "Prospectus") and as shall be set forth in one or more
supplements to the Prospectus (each, a "Prospectus Supplement"), by the
Company of up to $1,000,000,000 aggregate offering price of (i) debt
securities (the "Debt Securities"), (ii) shares or fractional shares of
preferred stock, par value $1.00 per share (the "Preferred Stock"), (iii)
shares of Preferred Stock represented by depository shares (the "Depository
Shares"), (iv) shares of common stock, par value $2.50 per share (the "Common
Stock") or (v) warrants to purchase Debt Securities, Preferred Stock,
Depositary Shares or Common Stock (collectively, the "Warrants"). The Debt
Securities, Preferred Stock, Depository Shares, Common Stock and Warrants are
collectively referred to as the "Securities." The Registration Statement
provides that Debt Securities may be convertible into shares of Common Stock
or Preferred Stock and Preferred Stock may be convertible into shares of
Common Stock.

<PAGE>

Hilton Hotels Corporation
December 20, 1996
Page 2

The Debt Securities will be issued pursuant to one or more indentures in
the form filed as an exhibit to the Registration Statement, as amended or
supplemented from time to time (each, an "Indenture") between the Company, as
obligor, and a trustee chosen by the Company and qualified to act as such
under the Trust Indenture Act of 1939, as amended (each, a "Trustee"). The
Depository Shares will be issued under one or more deposit agreements (each,
a "Deposit Agreement"), by and among the Company, the depositary named
therein (each, a "Depositary"), and the holders from time to time of receipts
for Depositary Shares ("Depositary Receipts"). The Warrants will be issued
under one or more warrant agreements (each, a "Warrant Agreement"), by and
among the Company and a financial institution identified therein as warrant
agent (each, a "Warrant Agent").

In our capacity as your counsel in connection with such registration, we
are familiar with the proceedings taken and proposed to be taken by the Company
in connection with the authorization and issuance of the Securities and, for the
purposes of this opinion, have assumed such proceedings will be timely completed
in the manner presently proposed and that the terms of each issuance will
otherwise be in compliance with law. In addition, we have made such legal and
factual examinations and inquiries, including an examination of originals or
copies certified or otherwise identified to our satisfaction of such documents,
corporate records and instruments, as we have deemed necessary or appropriate
for purposes of this opinion.

In our examination, we have assumed the genuineness of all signatures,
the authenticity of all documents submitted to us as originals, and the
conformity to authentic original documents of all documents submitted to us
as copies.

We have been furnished with, and with your consent have relied upon,
certificates of officers of the Company with respect to certain factual
matters. In addition, we have obtained and relied upon such certificates and
assurances from public officials as we have deemed necessary.

We are opining herein as to the effect on the subject transaction only of
the federal laws of the United States, the General Corporation Law of the
State of Delaware and the internal laws of the State of New York, and we
express no opinion with respect to the applicability thereto, or the effect
thereon, of the laws of any other jurisdiction or, in the case of Delaware,
any other laws or as to any matters of municipal law or the laws of any local
agencies within any state.

Subject to the foregoing and the other matters set forth herein, it is
our opinion that, as of the date hereof:

(1) When the Company and the Trustee duly execute and
deliver an Indenture and the specific terms of a particular Debt
Security have been duly established in accordance with such Indenture,
and such Debt Security has been duly authenticated by the Trustee and
duly executed and delivered on behalf of the Company against payment
therefor in accordance with the terms of the Indenture and as
contemplated by the Registration Statement and/or the applicable
Prospectus Supplement, such Debt

<PAGE>

Hilton Hotels Corporation
December 20, 1996
Page 3

Security will constitute a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms.

(2) The Company has the authority pursuant to its Restated
Certificate of Incorporation, as amended (the "Certificate") to issue
up to 24,832,700 shares of Preferred Stock. When a series of Preferred
Stock has been duly established in accordance with the terms of the
Company's Certificate and applicable law, and upon adoption by the
Board of Directors of the Company of a resolution in form and content
as required by applicable law and upon issuance and delivery of and
payment for shares of such serves in the manner contemplated by the
Registration Statement and/or the applicable Prospectus Supplement and
by such resolution, such shares of such series of Preferred Stock will
be validly issued, fully paid and nonassessable.

(3) When the terms of the Depositary Shares have been duly
established, and when the Depositary Receipts in the form contemplated
and authorized by a Deposit Agreement have been duly executed and
delivered by the Depositary and delivered to and paid for by the
purchasers thereof in the manner contemplated by the Registration
Statement and/or the applicable Prospectus Supplement, and when all
corporate action necessary for the issuance of such Depositary Shares
and the underlying Preferred Stock has been taken, such Depositary
Shares will be validly issued and will entitle the holders thereof to
the rights specified in the Depositary Receipts and such Deposit
Agreement for such Depositary Receipts.

(4) The Company has authority pursuant to its Certificate
to issue up to 424,832,700 shares of Common Stock. Upon adoption by
the Board of Directors of the Company of a resolution in form and
content as required by applicable law and upon issuance and delivery of
and payment for such shares in the manner contemplated by the
Registration Statement and/or the applicable Prospectus Supplement and
by such resolution, such shares of Common Stock will be validly issued,
fully paid and nonassessable.

(5) When the Warrants have been duly established by the
Warrant Agreement, duly authenticated by the Warrant Agent and duly
executed and delivered by the Company against payment therefor in
accordance with the terms of the Warrant Agreement and as contemplated
by the Registration Statement and/or the applicable Prospectus
Supplement, the Warrants will constitute valid and binding obligations
of the Company, enforceable against the Company in accordance with
their terms.

<PAGE>

Hilton Hotels Corporation
December 20, 1996
Page 4

The opinions set forth in clauses 1 and 5 above are subject to the
following exceptions, limitations and qualifications: (i) the effect of
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or
other similar laws now or hereafter in effect relating to or affecting the
rights or remedies of creditors; (ii) the effect of general principles of
equity, whether enforcement is considered in a proceeding in equity or at law,
and the discretion of the court before which any proceeding therefor may be
brought; (iii) the unenforceability under certain circumstances under law or
court decisions of provisions providing for the indemnification of or
contribution to a party with respect to a liability where such indemnification
or contribution is contrary to public policy; (iv) we express no opinion
concerning the enforceability of the waiver of rights or defenses contained in
ection 5.15 of the Indenture; and (v) we express no opinion with respect to
whether acceleration of Debt Securities may affect the collectibility of any
portion of the stated principal amount thereof which might be determined to
constitute unearned interest thereon.

To the extent that the obligations of the Company under an Indenture may
be dependent upon such matters, we assume for purposes of this opinion that
the Trustee is duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization; that the Trustee is duly
qualified to engage in the activities contemplated by the Indenture; that the
Indenture has been duly authorized, executed and delivered by the Trustee and
constitutes the legal, valid and binding obligation of the Trustee,
enforceable against the Trustee in accordance with its terms; that the
Trustee is in compliance, generally and with respect to acting as a trustee
under the Indenture, with all applicable laws and regulations; and that the
Trustee has the requisite organizational and legal power and authority to
perform its obligations under the Indenture.

To the extent that the obligations of the Company under each Depositary
Agreement may be dependent upon such matters, we assume for purposes of this
opinion that the Depositary is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization; that the
Depositary is duly qualified to engage in the activities contemplated by the
Depositary Agreement; that the Depositary Agreement has been duly authorized,
executed and delivered by the Depositary and constitutes the legal, valid and
binding obligation of the Depositary, enforceable against the Depositary in
accordance with its terms; that the Depositary is in compliance, generally
and with respect to acting as a Depositary under the Depositary Agreement,
with all applicable laws and regulations; and that the Depositary has the
requisite organizational and legal power and authority to perform its
obligations under the Depositary Agreement.

To the extent that the obligations of the Company under each Warrant
Agreement may be dependent upon such matters, we assume for purposes of this
opinion that the Warrant Agent is duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization; that the
Warrant Agent is duly qualified to engage in the activities contemplated by
the Warrant Agreement; that the Warrant Agreement has been duly authorized,
executed and delivered by the Warrant Agent and constitutes the legal, valid
and binding obligation of the Warrant Agent, enforceable against the Warrant
Agent in accordance with its terms; that the

<PAGE>

Hilton Hotels Corporation
December 20, 1996
Page 5

Warrant Agent is in compliance, generally and with respect to acting as
a Warrant Agent under the Warrant Agreement, with all applicable laws
and regulations; and that the Warrant Agent has the requisite
organizational and legal power and authority to perform its obligations
under the Warrant Agreement.

We consent to your filing this opinion as an exhibit to the Registration
Statement and to the reference to our firm under the caption "Legal Matters"
in the prospectus included therein.

Very truly yours,

Latham & Watkins

<PAGE>

HILTON HOTELS CORPORATION AND SUBSIDIARIES

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(dollar amounts in millions) (unaudited)

Nine months ended
September 30, Years Ended December 31,
---------------------- --------------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Income before income taxes
and minority interest (1) $223.0 $150.2 $261.5 $183.6 $156.2 $156.8 $121.3

Add:

Interest expense (1) 61.6 82.2 114.3 95.2 89.9 74.2 68.9

Distributions from less than 50% owned 8.5 7.6 13.5 12.1 6.4 4.8 5.2

Interest component of rent expense (1) (2) 2.8 2.5 3.5 3.0 2.9 2.7 2.3
--------- --------- --------- --------- --------- --------- ---------
Earnings available for fixed charges $295.9 $242.5 $392.8 $293.9 $255.4 $238.5 $197.7
--------- --------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- --------- ---------
Fixed charges:
Interest expense (1) $61.6 $82.2 $114.3 $95.2 $89.9 $74.2 $68.9

Capitalized interest 5.7 2.6 3.3 8.4 2.1 4.9 5.2

Interest component of rent expense (1) (2) 2.8 2.5 3.5 3.0 2.9 2.7 2.3
--------- --------- --------- --------- --------- --------- ---------
Total fixed charges $70.1 $87.3 $121.1 $106.6 $94.9 $81.8 $76.4
--------- --------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- --------- ---------

Ratio of earnings to fixed charges 4.2x 2.8x 3.2x 2.8x 2.7x 2.9x 2.6x
--------- --------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- --------- ---------
</TABLE>

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

(1) Includes unconsolidated 50% owned companies.

(2) Assuned interest component to be one-third of rent expense.

<PAGE>
EXHIBIT 23.2

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated February 1, 1996,
incorporated by reference in Hilton Hotels Corporation's Form 10-K for the year
ended December 31, 1995.

/s/ ARTHUR ANDERSEN LLP
--------------------------------------

Arthur Andersen LLP

Los Angeles, California
December 20, 1996

<PAGE>
EXHIBIT 23.3

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 Hilton Hotels
Corporation for the registration of $1,000,000,000 debt securities, preferred
stock, depository shares, common stock and warrants, and to the incorporation by
reference therein of our report dated February 7, 1996, with respect to the
consolidated financial statements and schedules of Bally Entertainment
Corporation in the Annual Report (Form 10-K) for the year ended December 31,
1995, and included as Exhibit 99(a) in the Hilton Hotels Corporation Form 8-K
dated December 20, 1996, both filed with the Securities and Exchange Commission.

ERNST & YOUNG LLP

Chicago, Illinois
December 18, 1996