<SUBMISSION>
<ACCESSION-NUMBER>0000950129-03-005638
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>7
<PERIOD>20030930
<FILING-DATE>20031114
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>QUANTA SERVICES INC
<CIK>0001050915
<ASSIGNED-SIC>1731
<IRS-NUMBER>742851603
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>001-13831
<FILM-NUMBER>03999679
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>1360 POST OAK BLVD
<STREET2>SUITE 2100
<CITY>HOUSTON
<STATE>TX
<ZIP>77056
<PHONE>7133506000
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>1360 POST OAK BLVD SUITE 2100
<CITY>HOUSTON
<STATE>TX
<ZIP>77056
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>h10560e10vq.txt
<DESCRIPTION>QUANTA SERVICES, INC.- SEPTEMBER 30, 2003
<TEXT>
<PAGE>

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

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                                   FORM 10-Q
                             ---------------------

<Table>
<C>        <S>
(Mark One)
   [X]     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934

           FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2003

                                  OR


   [ ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934

           FOR THE TRANSITION PERIOD FROM           TO         .
</Table>

                         COMMISSION FILE NO. 001-13831

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

                             QUANTA SERVICES, INC.
             (Exact name of registrant as specified in its charter)

<Table>
<S>                                            <C>
                   DELAWARE                                      74-2851603
       (State or other jurisdiction of                        (I.R.S. Employer
        Incorporation or organization)                      Identification No.)
</Table>

                              1360 POST OAK BLVD.
                                   SUITE 2100
                              HOUSTON, TEXAS 77056
                    (Address of principal executive offices)

              REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:
                                 (713) 629-7600

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

     Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes [X]     No [ ]

     Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2).  Yes [X]     No [ ]

     115,511,093 shares of Common Stock were outstanding as of November 10,
2003. As of the same date, 1,067,750 shares of Limited Vote Common Stock were
outstanding.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>

                     QUANTA SERVICES, INC. AND SUBSIDIARIES
                                     INDEX

<Table>
<Caption>
                                                                       PAGE
                                                                       ----
<S>      <C>                                                           <C>
                       PART I. FINANCIAL INFORMATION
Item 1.  Financial Statements
         Quanta Services, Inc. and Subsidiaries
         Consolidated Balance Sheets.................................    2
         Consolidated Statements of Operations.......................    3
         Consolidated Statements of Cash Flows.......................    4
         Notes to Condensed Consolidated Financial Statements........    5
Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations...................................   17
Item 4.  Controls and Procedures.....................................   28

                        PART II. OTHER INFORMATION
Item 1.  Legal Proceedings...........................................   29
Item 6.  Exhibits and Reports on Form 8-K............................   29
Signature............................................................   30
</Table>

                                        1
<PAGE>

                     QUANTA SERVICES, INC. AND SUBSIDIARIES

                          CONSOLIDATED BALANCE SHEETS
                    (IN THOUSANDS, EXCEPT SHARE INFORMATION)

<Table>
<Caption>
                                                              DECEMBER 31,   SEPTEMBER 30,
                                                                  2002           2003
                                                              ------------   -------------
                                                                              (UNAUDITED)
<S>                                                           <C>            <C>
                                          ASSETS
Current Assets:
  Cash and cash equivalents.................................   $   27,901     $   77,827
  Accounts receivable, net of allowances of $37,585 and
     $29,343, respectively..................................      367,057        388,630
  Costs and estimated earnings in excess of billings on
     uncompleted contracts..................................       54,749         53,460
  Inventories...............................................       25,646         25,665
  Current deferred taxes....................................       28,968          6,779
  Prepaid expenses and other current assets.................       25,176         33,366
                                                               ----------     ----------
          Total current assets..............................      529,497        585,727
Property and equipment, net.................................      369,568        346,022
Accounts and notes receivable, net of allowances of $28,389
  and $46,320, respectively.................................       50,900         35,689
Other assets, net...........................................       19,250         24,428
Goodwill and other intangibles, net.........................      395,597        395,400
                                                               ----------     ----------
          Total assets......................................   $1,364,812     $1,387,266
                                                               ==========     ==========


                           LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
  Current maturities of long-term debt......................   $    6,652     $    5,144
  Accounts payable and accrued expenses.....................      189,080        188,772
  Billings in excess of costs and estimated earnings on
     uncompleted contracts..................................       16,409         19,994
                                                               ----------     ----------
          Total current liabilities.........................      212,141        213,910
Long-term debt, net of current maturities...................      213,167        211,535
Convertible subordinated notes..............................      172,500        172,500
Deferred income taxes and other non-current liabilities.....       82,411        102,517
                                                               ----------     ----------
          Total liabilities.................................      680,219        700,462
                                                               ----------     ----------
Commitments and Contingencies
Redeemable common stock.....................................       72,922             --
Stockholders' Equity:
  Preferred Stock, $.00001 par value, 10,000,000 shares
     authorized:
     Series A Convertible Preferred Stock, 3,199,961 and no
      shares issued and outstanding, respectively...........           --             --
  Common Stock, $.00001 par value, 300,000,000 shares
     authorized, 70,632,899 and 116,439,340 shares issued
     and 69,706,528 and 115,512,969 outstanding,
     respectively(a)........................................           --             --
  Limited Vote Common Stock, $.00001 par value, 3,345,333
     shares authorized, 1,083,750 and 1,067,750 shares
     issued and outstanding, respectively...................           --             --
  Additional paid-in capital................................      980,303      1,070,446
  Deferred compensation.....................................         (302)        (8,142)
  Retained deficit..........................................     (356,605)      (363,775)
  Treasury Stock, 926,371 common shares, at cost............      (11,725)       (11,725)
                                                               ----------     ----------
          Total stockholders' equity........................      611,671        686,804
                                                               ----------     ----------
          Total liabilities and stockholders' equity........   $1,364,812     $1,387,266
                                                               ==========     ==========
</Table>

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

(a)  Shares issued and outstanding as of December 31, 2002 do not include the
     24,370,410 shares of Redeemable Common Stock valued at $72.9 million which
     was reclassified to stockholders' equity on February 20, 2003.
  The accompanying notes are an integral part of these condensed consolidated
                             financial statements.

                                        2
<PAGE>

                     QUANTA SERVICES, INC. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                  (IN THOUSANDS, EXCEPT PER SHARE INFORMATION)
                                  (UNAUDITED)

<Table>
<Caption>
                                                  THREE MONTHS ENDED       NINE MONTHS ENDED
                                                     SEPTEMBER 30,           SEPTEMBER 30,
                                                  -------------------   -----------------------
                                                    2002       2003        2002         2003
                                                  --------   --------   ----------   ----------
<S>                                               <C>        <C>        <C>          <C>
Revenues........................................  $436,215   $436,133   $1,317,957   $1,211,564
Cost of services (including depreciation).......   381,947    381,125    1,139,842    1,065,281
                                                  --------   --------   ----------   ----------
  Gross profit..................................    54,268     55,008      178,115      146,283
Selling, general and administrative expenses....    68,747     38,886      178,956      135,963
Goodwill impairment.............................        --         --      166,580           --
                                                  --------   --------   ----------   ----------
  Income (loss) from operations.................   (14,479)    16,122     (167,421)      10,320
Other Income (Expense):
  Interest expense..............................    (9,807)    (8,080)     (25,696)     (24,182)
  Other, net....................................    (1,674)       182          (56)          72
                                                  --------   --------   ----------   ----------
Income (loss) before income tax provision
  (benefit) and cumulative effect of change in
  accounting principle..........................   (25,960)     8,224     (193,173)     (13,790)
Provision (benefit) for income taxes............   (17,644)     2,825      (17,926)      (4,511)
                                                  --------   --------   ----------   ----------
Income (loss) before cumulative effect of change
  in accounting principle.......................    (8,316)     5,399     (175,247)      (9,279)
Cumulative effect of change in accounting
  principle, net of tax.........................        --         --      445,422           --
                                                  --------   --------   ----------   ----------
Net income (loss)...............................    (8,316)     5,399     (620,669)      (9,279)
Dividends (forfeitures) on preferred stock,
  net...........................................       234         --          698       (2,109)
                                                  --------   --------   ----------   ----------
Net income (loss) attributable to common
  stock.........................................  $ (8,550)  $  5,399   $ (621,367)  $   (7,170)
                                                  ========   ========   ==========   ==========

                                                 (RESTATED --           (RESTATED --
                                                   NOTE 2)                NOTE 2)
Earnings (Loss) Per Share:
  Basic Earnings (Loss) per Share Before
     Cumulative Effect of Change in Accounting
     Principle..................................  $  (0.14)  $   0.05   $    (2.89)  $    (0.06)
  Cumulative Effect of Change in Accounting
     Principle, Net of Tax......................        --         --        (7.30)          --
                                                  --------   --------   ----------   ----------
  Basic Earnings (Loss) per Share...............  $  (0.14)  $   0.05   $   (10.19)  $    (0.06)
                                                  ========   ========   ==========   ==========
  Diluted Earnings (Loss) per Share Before
     Cumulative Effect of Change in Accounting
     Principle..................................  $  (0.14)  $   0.05   $    (2.89)  $    (0.06)
  Cumulative Effect of Change in Accounting
     Principle, Net of Tax......................        --         --        (7.30)          --
                                                  --------   --------   ----------   ----------
  Diluted Earnings (Loss) per Share.............  $  (0.14)  $   0.05   $   (10.19)  $    (0.06)
                                                  ========   ========   ==========   ==========
Shares Used in Computing Earnings (Loss) Per
  Share:
  Basic.........................................    60,808    116,567       60,964      112,484
                                                  ========   ========   ==========   ==========
  Diluted.......................................    60,808    116,645       60,964      112,484
                                                  ========   ========   ==========   ==========
</Table>

  The accompanying notes are an integral part of these condensed consolidated
                             financial statements.
                                        3
<PAGE>

                     QUANTA SERVICES, INC. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                  (UNAUDITED)

<Table>
<Caption>
                                                              THREE MONTHS ENDED     NINE MONTHS ENDED
                                                                 SEPTEMBER 30,         SEPTEMBER 30,
                                                              -------------------   --------------------
                                                                2002       2003       2002        2003
                                                              --------   --------   ---------   --------
<S>                                                           <C>        <C>        <C>         <C>
Cash Flows from Operating Activities:
  Net income (loss) attributable to common stock............  $ (8,550)  $  5,399   $(621,367)  $ (7,170)
  Adjustments to reconcile net income (loss) attributable to
    common stock to net cash provided by (used in) operating
    activities --
    Cumulative effect of change in accounting principle, net
      of tax................................................        --         --     445,422         --
    Goodwill impairment.....................................        --         --     166,580         --
    Depreciation and amortization...........................    15,276     14,920      45,293     45,128
    Loss on sale of property and equipment..................       527        307       1,223      1,001
    Provision for doubtful accounts.........................    24,642        504      30,209     19,761
    Deferred income tax provision (benefit).................     6,761      3,558     (11,509)    35,862
    Amortization of deferred compensation...................        62        839         187      1,923
    Preferred stock dividends, net of forfeitures...........       234         --         698     (2,109)
  Changes in operating assets and liabilities, net of
    non-cash transactions --
    (Increase) decrease in --
      Accounts receivable...................................    (2,316)   (37,113)     29,116    (27,993)
      Costs and estimated earnings in excess of billings on
         uncompleted contracts..............................    (2,183)     2,032     (11,692)     1,289
      Inventories...........................................     3,949      1,173      (2,125)       (19)
      Prepaid expenses and other current assets.............     2,663     (3,582)      2,873     (3,597)
    Increase (decrease) in --
      Accounts payable and accrued expenses.................   (30,956)    10,462        (781)     6,188
      Billings in excess of costs and estimated earnings on
         uncompleted contracts..............................    (4,246)     4,699     (14,819)     3,585
      Other, net............................................     3,334        389       2,711      2,900
                                                              --------   --------   ---------   --------
         Net cash provided by operating activities..........     9,197      3,587      62,019     76,749
                                                              --------   --------   ---------   --------
Cash Flows from Investing Activities:
  Proceeds from sale of property and equipment..............     1,325      1,009       3,054      1,913
  Additions of property and equipment.......................    (6,433)   (11,459)    (39,804)   (23,936)
  Cash paid for acquisitions, net of cash acquired..........        --         --      (8,000)        --
  Cash restricted for self-insurance programs...............        --     (1,248)         --     (8,448)
  Notes receivable..........................................       (46)        --     (17,252)        --
                                                              --------   --------   ---------   --------
         Net cash used in investing activities..............    (5,154)   (11,698)    (62,002)   (30,471)
                                                              --------   --------   ---------   --------
Cash Flows from Financing Activities:
  Net borrowings under the credit facility..................     7,920         --      21,590         --
  Proceeds from other long-term debt........................       633        353       2,449      2,491
  Payments on other long-term debt..........................    (2,412)    (1,882)     (8,511)    (5,631)
  Debt issuance and amendment costs.........................    (2,700)      (315)     (2,700)      (315)
  Issuances of stock, net of offering costs.................     3,222      1,667       6,872      7,103
  Stock repurchases.........................................        77         --     (11,725)        --
  Exercise of stock options.................................         5         --       1,086         --
                                                              --------   --------   ---------   --------
         Net cash provided by (used in) financing
           activities.......................................     6,745       (177)      9,061      3,648
                                                              --------   --------   ---------   --------
Net increase (decrease) in cash and cash equivalents........    10,788     (8,288)      9,078     49,926
Cash and cash equivalents, beginning of period..............     4,577     86,115       6,287     27,901
                                                              --------   --------   ---------   --------
Cash and cash equivalents, end of period....................  $ 15,365   $ 77,827   $  15,365   $ 77,827
                                                              ========   ========   =========   ========
Supplemental Disclosure of Cash Flow Information
  Cash paid for --
    Interest................................................  $ 11,676   $  9,093   $  23,183   $ 20,042
    Income taxes, net of refunds............................       787     (1,144)      6,282    (39,566)
</Table>

  The accompanying notes are an integral part of these condensed consolidated
                             financial statements.
                                        4
<PAGE>

                     QUANTA SERVICES, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

1.  BUSINESS AND ORGANIZATION

     Quanta Services, Inc. (Quanta) is a leading provider of specialized
contracting services, offering end-to-end network solutions to the electric
power, gas, telecommunications and cable television industries. Quanta's
comprehensive services include designing, installing, repairing and maintaining
network infrastructure. The consolidated financial statements of Quanta include
the accounts of Quanta and its wholly owned subsidiaries. All significant
intercompany accounts and transactions have been eliminated in consolidation.

     In the course of its operations, Quanta is subject to certain risk factors,
including but not limited to risks related to: economic downturn, access to
capital, compliance with lenders' financial covenants, the financial condition
of Quanta's customers, the collectibility of receivables, significant
fluctuations in quarterly results, contract terms, recoverability of goodwill,
rapid technological and structural changes in the industries Quanta serves,
competition, internal growth and operating strategies, management of growth,
acquisition integration and financing, unionized workforce, dependence on key
personnel, availability of qualified employees, potential exposure to
environmental liabilities and anti-takeover measures.

  Interim Condensed Consolidated Financial Information

     These unaudited condensed consolidated financial statements have been
prepared pursuant to the rules of the Securities and Exchange Commission (SEC).
Certain information and footnote disclosures, normally included in annual
financial statements prepared in accordance with accounting principles generally
accepted in the United States, have been condensed or omitted pursuant to those
rules and regulations. Quanta believes that the disclosures made are adequate to
make the information presented not misleading. In the opinion of management, all
adjustments, consisting only of normal recurring adjustments, necessary to
fairly present the financial position, results of operations and cash flows with
respect to the interim consolidated financial statements have been included. The
results of operations for the interim periods are not necessarily indicative of
the results for the entire fiscal year. The results of Quanta have historically
been subject to significant seasonal fluctuations.

     It is suggested that these unaudited condensed consolidated financial
statements be read in conjunction with the audited consolidated financial
statements and notes thereto of Quanta Services, Inc. and subsidiaries included
in Quanta's Annual Report on Form 10-K, which was filed with the SEC on March
31, 2003, as amended by Amendment No. 1 thereto on Form 10-K/A, which was filed
with the SEC on October 2, 2003.

  Use of Estimates and Assumptions

     The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires the use of estimates
and assumptions by management in determining the reported amounts of assets and
liabilities, disclosures of contingent assets and liabilities known to exist as
of the date the financial statements are published and the reported amount of
revenues and expenses recognized during the periods presented. Quanta reviews
all significant estimates affecting its consolidated financial statements on a
recurring basis and records the effect of any necessary adjustments prior to
their publication. Judgments and estimates are based on Quanta's beliefs and
assumptions derived from information available at the time such judgments and
estimates are made. Uncertainties with respect to such estimates and assumptions
are inherent in the preparation of financial statements. Estimates are primarily
used in Quanta's assessment of the allowance for doubtful accounts, valuation of
inventory, fair value assumption in analyzing goodwill and long-lived asset
impairments, self-insured claims liabilities, revenue recognition under
percentage-of-completion accounting and income taxes.

                                        5
<PAGE>
                     QUANTA SERVICES, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  Current and Non-Current Accounts and Notes Receivable and Provision for
  Doubtful Accounts

     Quanta provides an allowance for doubtful accounts when collection of an
account or note receivable is considered doubtful. Inherent in the assessment of
the allowance for doubtful accounts are certain judgments and estimates
including, among others, our customer's access to capital, the customer's
willingness or ability to pay, general economic conditions and the ongoing
relationship with the customer. Under certain circumstances, such as
foreclosures or negotiated settlements, Quanta may take title to the underlying
assets in lieu of cash in settlement of receivables. As of September 30, 2003,
Quanta has provided allowances for doubtful accounts of approximately $75.7
million. Certain of Quanta's customers, several of them large public
telecommunications carriers, have filed for bankruptcy or have been experiencing
financial difficulties. Also, a number of Quanta's utility customers are
experiencing financial difficulties in the current business climate. Should
additional customers file for bankruptcy or continue to experience difficulties,
or should anticipated recoveries relating to receivables in existing
bankruptcies or other workout situations fail to materialize, Quanta could
experience reduced cash flows and losses in excess of current allowances
provided. In addition, material changes in our customers' revenues or cash flows
could affect our ability to collect amounts due from them.

     In June 2002, a large Quanta customer, Adelphia Communications Corporation
(Adelphia), filed for bankruptcy protection under Chapter 11 of the Bankruptcy
Code, as amended. Quanta has filed liens on various properties to secure
substantially all of its pre-petition receivables. The carrying value is based
upon Quanta's understanding of the current status of the Adelphia bankruptcy
proceeding and a number of assumptions, including assumptions about the
validity, priority and enforceability of our security interests. Quanta
currently believes it will collect a substantial majority of the balances owed.
Should any of the factors underlying Quanta's estimate change, the amount of
Quanta's allowance could change significantly. Quanta is uncertain as to whether
such receivables will be collected within one year and therefore has included
this amount in non-current assets as Accounts and Notes Receivable. Also
included in non-current Accounts and Notes Receivable are amounts due from
another customer relating to the construction of independent power plants.
Quanta has agreed to long-term payment terms for this customer. The notes
receivable are partially secured and bear interest at 9.5% per year. Quanta has
provided allowances for these notes receivable due to a substantial
deterioration in the estimated future cash flows of the plants, resulting in a
carrying value equal to the estimated value of the collateral securing these
notes. As of September 30, 2003, the total long-term balances due from both of
these customers was $81.2 million, net of an allowance for doubtful accounts of
$46.3 million.

  Concentration of Credit Risk

     Quanta grants credit, generally without collateral, to its customers, which
include electric power and gas companies, telecommunications and cable
television system operators, governmental entities, general contractors,
builders and owners and managers of commercial and industrial properties located
primarily in the United States. Consequently, Quanta is subject to potential
credit risk related to changes in business and economic factors throughout the
United States. However, Quanta typically has certain lien rights on the services
provided.

  Stock-Based Compensation

     Quanta accounts for its stock-based compensation under Accounting
Principles Board Opinion No. 25 (APB Opinion No. 25), "Accounting for Stock
Issued to Employees." Under this accounting method, no compensation expense is
recognized in the consolidated statements of operations if no intrinsic value of
the option exists at the date of grant. In October 1995, the Financial
Accounting Standards Board (FASB) issued Statement of Financial Accounting
Standards (SFAS) No. 123, "Accounting for Stock-Based Compensation." SFAS No.
123 encourages companies to account for stock-based compensation awards based on
the fair

                                        6
<PAGE>
                     QUANTA SERVICES, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

value of the awards at the date they are granted. The resulting compensation
cost would be shown as an expense in the consolidated statements of operations.
Companies can choose not to apply the new accounting method and continue to
apply current accounting requirements; however, disclosure is required as to
what net income and earnings per share would have been had SFAS No. 123 been
followed. In addition, Quanta has an Employee Stock Purchase Plan (ESPP). SFAS
No. 123 requires the inclusion of stock issued pursuant to an ESPP in the as
adjusted disclosure.

     Had compensation costs for the 2001 Stock Incentive Plan and the ESPP been
determined consistent with SFAS No. 123, Quanta's net income attributable to
common stock and earnings per share would have been reduced to the following as
adjusted amounts (in thousands, except per share information):

<Table>
<Caption>
                                              THREE MONTHS ENDED     NINE MONTHS ENDED
                                                 SEPTEMBER 30,         SEPTEMBER 30,
                                              -------------------   --------------------
                                                2002       2003       2002        2003
                                              ---------   -------   ---------   --------
<S>                                           <C>         <C>       <C>         <C>
Net income (loss) attributable to common
  stock
  As Reported...............................  $ (8,550)   $5,399    $(621,367)  $ (7,170)
  As Adjusted -- Basic......................  $(14,088)   $4,897    $(637,849)  $(12,705)
  As Adjusted -- Diluted....................  $(14,088)   $4,897    $(637,849)  $(12,705)
Earnings (loss) per share
  As Reported -- Basic......................  $  (0.14)   $ 0.05    $  (10.19)  $  (0.06)
  As Adjusted -- Basic......................  $  (0.23)   $ 0.04    $  (10.46)  $  (0.11)
  As Reported -- Diluted....................  $  (0.14)   $ 0.05    $  (10.19)  $  (0.06)
  As Adjusted -- Diluted....................  $  (0.23)   $ 0.04    $  (10.46)  $  (0.11)
</Table>

     See Note 7 for additional discussion of the restricted stock issued under
Quanta's 2001 Stock Incentive Plan and the effects thereof.

                                        7
<PAGE>
                     QUANTA SERVICES, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

2.  PER SHARE INFORMATION

     Earnings (loss) per share amounts are based on the weighted average number
of shares of common stock and common stock equivalents outstanding during the
period. The weighted average number of shares used to compute basic and diluted
earnings (loss) per share for the three and nine months ended September 30, 2002
and 2003 is illustrated below (in thousands):

<Table>
<Caption>
                                          THREE MONTHS ENDED                      NINE MONTHS ENDED
                                             SEPTEMBER 30,                          SEPTEMBER 30,
                                 -------------------------------------   ------------------------------------
                                     2002           2002        2003         2002           2002       2003
                                 -------------   ----------   --------   -------------   ----------   -------
                                 (AS REPORTED)   (RESTATED)              (AS REPORTED)   (RESTATED)
<S>                              <C>             <C>          <C>        <C>             <C>          <C>
Net Income (Loss):
  Net income (loss)
     attributable to common
     stock.....................     $(8,550)      $(8,550)    $  5,399     $(621,367)    $(621,367)   $(7,170)
  Dividends on Series A
     Convertible Preferred
     Stock, net of forfeitures,
     if assumed conversion is
     dilutive..................         234            --           --           698            --         --
                                    -------       -------     --------     ---------     ---------    -------
  Net income (loss) for basic
     earnings (loss) per
     share.....................      (8,316)       (8,550)       5,399      (620,669)     (621,367)    (7,170)
                                    -------       -------     --------     ---------     ---------    -------
  Effect of convertible
     subordinated notes under
     the "if converted"
     method -- interest expense
     addback, net of taxes.....          --            --           --            --            --         --
                                    -------       -------     --------     ---------     ---------    -------
  Net income (loss) for diluted
     earnings (loss) per
     share.....................     $(8,316)      $(8,550)    $  5,399     $(620,669)    $(621,367)   $(7,170)
                                    =======       =======     ========     =========     =========    =======
Weighted Average Shares:
  Weighted average shares
     outstanding for basic
     earnings (loss) per share,
     including Series A
     Convertible Preferred
     Stock, if dilutive........      77,552        60,808      116,567        76,941        60,964    112,484
  Effect of dilutive stock
     options...................         654            --           78         1,243            --         --
  Effect of convertible
     subordinated notes under
     the "if converted"
     method -- weighted
     convertible shares........          --            --           --            --            --         --
                                    -------       -------     --------     ---------     ---------    -------
  Weighted average shares
     outstanding for diluted
     earnings (loss) per
     share.....................      78,206        60,808      116,645        78,184        60,964    112,484
                                    =======       =======     ========     =========     =========    =======
</Table>

     For the three and nine months ended September 30, 2002, approximately 9.3
million and 8.3 million stock options were excluded from the computation of
diluted earnings (loss) per share because the options' exercise prices were
greater than the average market price of Quanta's common stock. For the three
and nine months ended September 30, 2003, approximately 1.0 million and 1.4
million stock options were excluded from the computation of diluted earnings
(loss) per share because the options' exercise prices were greater than the
average market price of Quanta's common stock. For the three and nine months
ended September 30, 2002, Quanta excluded 72,762 and 270,020 stock options, with
exercise prices lower than the average

                                        8
<PAGE>
                     QUANTA SERVICES, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

market price of Quanta's Common Stock, from the computation of diluted earnings
(loss) per share because the effect of including them would be antidilutive. For
the nine months ended September 30, 2003, Quanta excluded 9,237 stock options,
with exercise prices lower than the average market price of Quanta's Common
Stock, from the computation of diluted earnings (loss) per share because the
effect of including them would be antidilutive. For the three and nine months
ended September 30, 2002 and 2003, the effect of assuming conversion of the
convertible subordinated notes would be antidilutive and they were therefore
excluded from the calculation of diluted earnings (loss) per share.

     Restatement -- The weighted average number of basic and dilutive shares and
the computation of basic and diluted earnings (loss) per share for the three and
nine months ended September 30, 2002, have been restated to conform to Quanta's
Amendment No. 1 on Form 10-K/A filed with the SEC on October 2, 2003. The
weighted average number of shares for the three and nine months ended September
30, 2002 were restated to exclude the shares issuable upon conversion of the
Series A Convertible Preferred Stock from the computation of basic and diluted
earnings (loss) per share, as the effect of including those shares was
antidilutive. The restatement of the weighted average number of shares results
in the restatement of basic and diluted earnings (loss) per share for the three
and nine months ended September 30, 2002 to $(0.14) and $(10.19) compared to the
originally reported earnings (loss) per share of $(0.11) and $(7.94). For the
nine months ended September 30, 2002, the restated basic and diluted earnings
(loss) per share before cumulative effect of change in accounting principle is
$(2.89) per share, compared to the originally reported amount of $(2.24) per
share and the restated basic and diluted earnings (loss) per share of the
cumulative effect of change in accounting principle is $(7.30) per share
compared to $(5.70) per share as originally reported.

3.  INCOME TAXES

     Quanta follows the liability method of accounting for income taxes in
accordance with SFAS No. 109, "Accounting for Income Taxes." Under this method,
deferred tax assets and liabilities are recorded for future tax consequences of
temporary differences between the financial reporting and tax bases of assets
and liabilities, and are measured using the enacted tax rates and laws that will
be in effect when the underlying assets or liabilities are recovered or settled.

4.  NEW ACCOUNTING PRONOUNCEMENTS

     In May 2003, the FASB issued SFAS No. 149 "Amendment of Statement 133 on
Derivative Instruments and Hedging Activities." SFAS No. 149 amends and
clarifies financial accounting and reporting for derivative instruments,
including certain derivative instruments embedded in other contracts and for
hedging activities under SFAS No. 133. This statement is effective for contracts
entered into or modified after June 30, 2003 (with certain exceptions) and for
hedging relationships entered into after June 30, 2003. We do not have any
financial instruments that fall under the scope of this statement and do not
believe that the adoption of SFAS No. 149 will have a material effect on either
our financial position, results of operations or cash flows.

     In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain
Financial Instruments with Characteristics of both Liabilities and Equity." SFAS
No. 150 establishes standards for classifying and measuring certain financial
instruments with characteristics of both liabilities and equity. Financial
instruments that fall within the scope of SFAS No. 150 will be classified as
liabilities (or assets in some circumstances). This statement is effective at
the beginning of the first interim period beginning after June 15, 2003. The
adoption of SFAS No. 150 did not have a material impact on our results of
operations or financial position.

                                        9
<PAGE>
                     QUANTA SERVICES, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

5.  GOODWILL AND OTHER INTANGIBLES

     Effective January 1, 2002, Quanta adopted SFAS No. 142, "Goodwill and Other
Intangible Assets," which establishes new accounting and reporting requirements
for goodwill and other intangible assets. Under SFAS No. 142, all goodwill
amortization ceased effective January 1, 2002. Material amounts of recorded
goodwill attributable to each of Quanta's reporting units were tested for
impairment by comparing the fair value of each reporting unit with its carrying
value. Fair value was determined using a combination of the discounted cash
flow, market multiple and market capitalization valuation approaches. These
impairment tests are required to be performed at adoption of SFAS No. 142 and at
least annually thereafter or more frequently if events or changes in
circumstances indicate that the asset might be impaired. Significant estimates
used in the methodologies include estimates of future cash flows, future
short-term and long-term growth rates, weighted average cost of capital and
estimates of market multiples for each of the reportable units. On an ongoing
basis (absent any impairment indicators), Quanta performs impairment tests
annually during the fourth quarter.

     Based on Quanta's transitional impairment test performed upon adoption of
SFAS No. 142 during the nine months ended September 30, 2002, Quanta recognized
a $488.5 million non-cash charge, ($445.4 million, net of tax) to reduce the
carrying value of goodwill to the implied fair value of Quanta's reporting
units. Under SFAS No. 142, the impairment adjustment recognized upon adoption of
the new rules was reflected as a cumulative effect of change in accounting
principle, net of tax.

     Quanta further recognized an interim non-cash goodwill impairment charge of
approximately $166.6 million during the nine months ended September 30, 2002.
Impairment adjustments recognized after adoption are required to be recognized
as operating expenses. The primary factor contributing to the interim impairment
charge was the overall deterioration of the business climate during 2002 in the
markets Quanta serves as evidenced by an increased number of bankruptcies in the
telecommunications industry, continued devaluation of several of Quanta's
customers' debt and equity securities and pricing pressures resulting from
challenges faced by major industry participants. Fair value was determined using
a combination of the discounted cash flow, market multiple and market
capitalization valuation approaches. Interim goodwill impairment assessments are
required whenever events or changes occur during the year that indicate that the
goodwill may not be recoverable.

     Late in the second quarter of 2003, a dispute developed between one of
Quanta's subsidiaries and its primary customer, leading to a suspension of work
for that customer. It is unclear whether the dispute will be resolved favorably
or whether work for this customer will resume. If the dispute settles
unfavorably for the subsidiary or the subsidiary is unable to replace this work
with comparable cash flows, Quanta may record a non-cash goodwill impairment
charge of up to $6.5 million.

6.  DEBT

  Credit Facility

     As of September 30, 2003, Quanta had a $225.0 million credit facility with
14 participating banks, which would have matured on June 14, 2004. The credit
facility was secured by a pledge of substantially all of the capital stock of
Quanta's subsidiaries and the majority of Quanta's assets and was to provide
funds to be used for working capital and for other general corporate purposes.
Quanta's subsidiaries guaranteed the repayment of all amounts due under the
facility and the facility restricted pledges on all material assets. Amounts
borrowed under the credit facility bore interest at a rate equal to either (a)
the London Interbank Offered Rate (the 30 day LIBOR rate was 1.12% at September
30, 2003) plus 1.50% to 3.50%, as determined by the ratio of Quanta's total
funded debt to EBITDA (as defined in the credit facility) or (b) the bank's
prime rate (which was 4.0% at September 30, 2003) plus up to 2.00%, as
determined by the ratio of Quanta's total funded debt to EBITDA. Commitment fees
of 0.375% to 0.50%, based on Quanta's total funded debt to

                                        10
<PAGE>
                     QUANTA SERVICES, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

EBITDA, were due on any unused borrowing capacity under the credit facility. The
credit facility contained certain financial ratio and indebtedness covenants,
including a maximum funded debt to EBITDA ratio, a minimum interest coverage
ratio and a maximum senior debt to EBITDA ratio. The credit facility also
prohibited the payment of dividends and stock repurchase programs and limited
capital expenditures and asset sales. Additionally the credit facility required
a mandatory reduction in the banks' commitment by a portion of the proceeds from
asset sales in excess of $5.0 million annually or upon the issuance of
additional debt in excess of $15.0 million. As of September 30, 2003, Quanta had
$90.7 million of letters of credit outstanding under the credit facility,
primarily to secure Quanta's potential obligations under its casualty insurance
programs.

     In November 2003, Quanta amended its credit facility to convert it into a
fully funded term loan of $60.0 million and a letter of credit facility of up to
$120.0 million with one bank, maturing on January 1, 2005. The term loan was
used to repay a portion of the senior secured notes, discussed below. Amounts
borrowed under the term loan bear interest at a rate equal to LIBOR plus 3.25%.
The credit facility as amended is secured by a pledge of substantially all of
the capital stock of Quanta's subsidiaries and the majority of Quanta's assets.
Quanta's U.S. subsidiaries guarantee the repayment of all amounts due under the
facility and the facility restricts pledges on all material assets. The facility
contains certain financial ratio and indebtedness covenants, including a maximum
funded debt to EBITDA ratio, a minimum interest coverage ratio and a maximum
senior debt to EBITDA ratio, that are generally less restrictive than those in
existence prior to amendment. The facility also prohibits the payment of
dividends and stock repurchase programs and limits capital expenditures and
asset sales. The facility requires cash collateralization of all letters of
credit, and Quanta has collateralized the $90.7 million in letters of credit
that were outstanding as of September 30, 2003. As a result of the amendment,
$1.1 million in unamortized deferred financing costs will be expensed during the
fourth quarter of 2003.

     Quanta currently has a commitment from a lender for a new $200.0 million
credit facility, subject to certain conditions precedent. Quanta anticipates
closing the new credit facility in the fourth quarter of 2003 and plans to pay
off the above discussed term loan and letter of credit facility with the
proceeds of the new facility.

  4.0% Convertible Subordinated Notes

     During the third quarter of 2000, Quanta issued $172.5 million principal
amount of convertible subordinated notes. These convertible subordinated notes
bear interest at 4.0% per year and are convertible into shares of Quanta's
common stock at a price of $54.53 per share, subject to adjustment as a result
of certain events. The convertible subordinated notes require semi-annual
interest payments beginning December 31, 2000, until the notes mature on July 1,
2007. Quanta has the option to redeem the notes beginning July 3, 2003 at
specified redemption prices, together with accrued and unpaid interest; however
redemption is prohibited by Quanta's credit facility as amended. If certain
fundamental changes occur, as described in the indenture under which Quanta
issued the notes, holders of the convertible subordinated notes may require
Quanta to purchase all or part of the notes at a purchase price equal to 100% of
the principal amount, plus accrued and unpaid interest. In the event of such
circumstance, consent to repurchase the convertible subordinated notes would be
required under Quanta's credit facility as amended.

  4.5% Convertible Subordinated Notes

     In October 2003, Quanta issued $270.0 million principal amount of
convertible subordinated notes. Quanta used the net proceeds to repay a portion
of the senior secured notes, discussed below, and to cash collateralize the
letters of credit under the credit facility as amended. These convertible
subordinated notes bear interest at 4.5% per year and are convertible into
shares of Quanta's common stock at a price of

                                        11
<PAGE>
                     QUANTA SERVICES, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

$11.14 per share, subject to adjustment as a result of certain events. The
convertible subordinated notes require semi-annual interest payments beginning
April 1, 2004, until the notes mature on October 1, 2023.

     The convertible subordinated notes are convertible by the holder if (i)
during any fiscal quarter commencing after December 31, 2003 the last reported
sale price of Quanta's common stock is greater than or equal to 120% of the
conversion price for at least 20 trading days in the period of 30 consecutive
trading days ending on the first trading day of such fiscal quarter, (ii) during
the five business day period after any five consecutive trading day period in
which the trading price per note for each day of that period was less than 98%
of the product of the last reported sale price of Quanta's common stock and the
conversion rate, (iii) upon Quanta calling the notes for redemption or (iv) upon
the occurrence of specified corporate transactions. If the notes become
convertible under one of these circumstances, Quanta has the option to deliver
cash, shares of Quanta's common stock or a combination thereof, with a value
equal to the par value of the notes divided by the conversion price multiplied
by the average trading price of Quanta's common stock. The maximum number of
shares of common stock that could be issued under these circumstances is equal
to the par value of the notes divided by the conversion price.

     Beginning October 8, 2008, Quanta may redeem for cash some or all of the
notes at par value plus accrued and unpaid interest. The holders of the notes
may require Quanta to repurchase all or some of the notes at par value plus
accrued and unpaid interest on October 1, 2008, 2013 or 2018, or upon the
occurrence of a fundamental change, as defined by the indenture under which
Quanta issued the notes. Any repurchases on October 1, 2008 must be paid in
cash, and for all other repurchases, Quanta has the option of settling with
cash, shares of Quanta's common stock or a combination thereof. If Quanta elects
to settle with shares of common stock, the number of shares delivered will equal
the dollar amount to be paid in common stock divided by 98.5% of the market
price of Quanta's common stock, as defined by the indenture. The number of
shares to be issued under this circumstance is not limited. The right to settle
for shares of common stock can be surrendered by Quanta.

  Senior Secured Notes

     As of September 30, 2003, Quanta had $210.0 million principal amount of
senior secured notes outstanding, primarily with insurance companies, with
maturities currently ranging from March 2005 to September 2010. The senior
secured notes bore interest at a weighted average interest rate between 8.41%
and 9.91% as determined by the ratio of Quanta's total funded debt to EBITDA.
The weighted average interest rate as of September 30, 2003 was 9.91%. In
addition, the senior secured notes carried a make-whole provision customary for
this type of debt instrument on prepayment of principal, including any mandatory
prepayments. The senior secured notes carried cross-default provisions and
ranked equally in right of repayment with indebtedness under Quanta's then
existing credit facility.

     In the fourth quarter of 2003, Quanta retired the $210.0 million of senior
secured notes and paid associated make-whole prepayment premiums in the amount
of $31.3 million. The make-whole prepayment premiums, along with the related
unamortized deferred financing costs in the amount of approximately $2.6
million, will be expensed in the fourth quarter of 2003.

7.  STOCKHOLDERS' EQUITY

  Series A Convertible Preferred Stock

     In September 1999, Quanta issued shares of Series A Convertible Preferred
Stock, $.00001 par value per share. All outstanding shares of Series A
Convertible Preferred Stock remaining were converted into common stock during
the first quarter of 2003 and the series was eliminated during the second
quarter of 2003.

                                        12
<PAGE>
                     QUANTA SERVICES, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  First Reserve Investment

     During the fourth quarter of 2002, First Reserve Fund IX, L.P. (First
Reserve) purchased from Quanta approximately 2.4 million shares of newly issued
Series E Preferred Stock at $30.00 per share. The Series E Preferred Stock was
converted into 24.3 million shares of common stock on December 31, 2002 and the
series was eliminated during the second quarter of 2003.

     Through February 20, 2003, First Reserve had the right to require Quanta to
repurchase for cash the shares of common stock issued as a result of the
conversion of the shares of Series E Preferred Stock if Quanta had a change in
control. As such, the $72.9 million investment was reflected in the consolidated
balance sheet as Redeemable Common Stock at December 31, 2002. On February 20,
2003, at the expiration of this right, the Redeemable Common Stock was
reclassified to stockholders' equity.

     In connection with their investment, First Reserve is entitled to a
pre-emptive right to purchase shares of common stock upon Quanta's issuance of
shares to third parties. During the first nine months of 2003, First Reserve
acquired 1,201,128 shares pursuant to such right.

  Restricted Stock

     Pursuant to the 2001 Stock Incentive Plan, Quanta issues restricted common
stock at the fair market value of the common stock as of the date of issuance.
The shares of restricted common stock issued pursuant to the 2001 Stock
Incentive Plan are subject to restrictions on transfer and certain other
conditions. During the restriction period, the plan participants are entitled to
vote and receive dividends on such shares. Upon issuance of the common stock, an
unamortized compensation expense equivalent to the market value of the shares on
the date of grant is charged to stockholders' equity and is amortized over the
restriction period, typically three years.

     On January 21, 2003, Quanta offered eligible employees and consultants the
opportunity to exchange certain outstanding stock options, with an exercise
price of $10.00 or more, for restricted shares of Quanta's common stock at an
exchange ratio of one share of restricted stock for every 2.24 option shares
tendered. As restricted stock, the shares are subject to forfeiture and other
restrictions until they vest. Regardless of the vesting schedule of the eligible
options offered for exchange, the restricted stock granted in the offer vests
over three years in equal annual installments on February 28 of each year,
beginning February 28, 2004, assuming the employee or consultant continues to
meet the requirements for vesting. On March 10, 2003, Quanta accepted for
exchange and canceled eligible options to purchase an aggregate of 6,769,483
shares of its common stock, representing approximately 93% of the 7,289,750
options that were eligible to be tendered in the offer as of the expiration
date. Pursuant to the terms of the offer, Quanta granted restricted stock
representing an aggregate of 3,022,112 shares of its common stock, or
approximately $9.0 million in value, in exchange for the tendered eligible
options. This restricted stock issuance will require Quanta to recognize a
non-cash compensation charge of approximately $3.0 million per year over the
three-year vesting period of the restricted stock. The remaining eligible
options that were not exchanged will be required to be accounted for under
variable plan accounting under APB Opinion No. 25. In the future, to the extent
that Quanta's stock price exceeds the exercise price of an eligible option that
was not exchanged, the difference will be recorded as a non-cash compensation
charge with an offset to additional paid-in capital. No charges have been
recorded with respect to these options under variable plan accounting through
September 30, 2003.

     As of September 30, 2002 and 2003, 63,614 and 3,229,262 shares of
restricted stock were outstanding. The compensation expense recognized with
respect to all restricted stock during the three and nine months ended September
30, 2002 was approximately $62,000 and $187,500, and for the three and nine
months ended September 30, 2003 was approximately $839,000 and $1,923,000.

                                        13
<PAGE>
                     QUANTA SERVICES, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

8.  SEGMENT INFORMATION

     Quanta has aggregated each of its individual operating units into one
reportable segment as a specialty contractor. Quanta provides comprehensive
network solutions to the electric power, gas, telecommunications and cable
television industries, including designing, installing, repairing and
maintaining network infrastructure. In addition, Quanta provides ancillary
services such as inside electrical wiring, intelligent traffic networks, cable
and control systems for light rail lines, airports and highways, and specialty
rock trenching, directional boring and road milling for industrial and
commercial customers. The following table presents information regarding
revenues derived from the industries noted above. Certain reclassifications have
been made to the prior period in order to conform to the current period
presentation.

<Table>
<Caption>
                                                                 NINE MONTHS ENDED
                                                                   SEPTEMBER 30,
                                                              -----------------------
                                                                 2002         2003
                                                              ----------   ----------
                                                                  (IN THOUSANDS)
<S>                                                           <C>          <C>
Electric power and gas network services.....................  $  714,333   $  736,631
Telecommunications network services.........................     224,053      180,523
Cable television network services...........................     160,791       84,809
Ancillary services..........................................     218,780      209,601
                                                              ----------   ----------
                                                              $1,317,957   $1,211,564
                                                              ==========   ==========
</Table>

     Quanta currently does not have significant operations or long-lived assets
in countries outside of the United States.

9.  COMMITMENTS AND CONTINGENCIES

  Litigation

     Quanta is from time to time party to various lawsuits, claims and other
legal proceedings that arise in the ordinary course of business. These actions
typically seek, among other things, compensation for alleged personal injury,
breach of contract, property damage, punitive damages, civil penalties or other
losses, or injunctive or declaratory relief. With respect to such lawsuits,
claims and proceedings, Quanta establishes reserves when it is probable a
liability has been incurred and the amount of loss can be reasonably estimated.
Quanta does not believe that any of these proceedings, separately or in the
aggregate, would be expected to have a material adverse effect on Quanta's
results of operations or financial position.

  Self-Insurance

     As of September 30, 2003, Quanta was insured for employer's liability and
general liability claims, subject to a deductible of $1,000,000 per occurrence
and for auto liability and workers' compensation, subject to a deductible of
$2,000,000 per occurrence. Quanta's consolidated non-union employee related
health care benefits plan is subject to a deductible of $250,000 per claimant
per year. Losses up to the deductible amounts under all plans are accrued based
upon Quanta's estimates of the ultimate liability for claims incurred and an
estimate of claims incurred but not reported. The accruals are based upon known
facts and historical trends and management believes such accruals to be
adequate. At December 31, 2002 and September 30, 2003, the amounts accrued for
self-insured claims were $45.0 million and $60.4 million, with $27.4 million and
$34.4 million considered to be long-term and included in Other Non-Current
Liabilities.

     Quanta is contractually obligated to fund its casualty self-insurance
obligations applicable to the policy period from March 1, 2003 to February 29,
2004 with a combination of a cash trust account of $14.4 million and letters of
credit totaling $24.4 million. Through September 30, 2003, Quanta had funded the
cash trust account with $10.8 million and issued $18.6 million in letters of
credit pursuant to the policy period from

                                        14
<PAGE>
                     QUANTA SERVICES, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

March 1, 2003 to February 29, 2004. As of September 30, 2003, the remaining
restricted cash balance totaled $8.4 million, with $4.6 million classified as
current and included in Prepaid Expenses and Other Current Assets and $3.8
million classified as non-current and included in Other Assets, Net.

  Performance Bonds

     In certain circumstances, Quanta is required to provide performance bonds
in connection with its contractual commitments. Quanta has indemnified the
surety for any expenses paid out under these performance bonds. As of September
30, 2003, the total amount of outstanding performance bonds was approximately
$515.6 million.

  Leases

     Quanta leases certain buildings and equipment under non-cancelable lease
agreements including related party leases. The following schedule shows the
future minimum lease payments under these leases as of September 30, 2003 (in
thousands):

<Table>
<Caption>
                                                              CAPITAL   OPERATING
                                                              LEASES     LEASES
                                                              -------   ---------
<S>                                                           <C>       <C>
Year Ending December 31 --
2003........................................................   $ 45      $ 4,880
2004........................................................    103       14,734
2005........................................................      4       10,421
2006........................................................     --        5,304
2007........................................................     --        2,309
Thereafter..................................................     --        4,483
                                                               ----      -------
          Total minimum lease payments......................   $152      $42,131
                                                               ====      =======
  Less -- Amounts representing interest.....................      2
                                                               ----
  Present value of minimum lease payments...................    150
  Less -- Current portion...................................     45
                                                               ----
  Total long-term obligations...............................   $105
                                                               ====
</Table>

     Quanta has guaranteed a residual value on certain equipment operating
leases. Quanta guarantees the difference between this residual value and the
fair market value of the underlying asset at the date of termination of the
leases. At September 30, 2003, the maximum guaranteed residual value would have
been approximately $121.8 million. Quanta believes that no significant payments
will be made as a result of the difference between the fair market value of the
leased equipment and the guaranteed residual value. However, there can be no
assurance that future significant payments will not be required.

  Contingent Payments

     Quanta is subject to an agreement with the former owners of an operating
unit that was acquired in 2000. Under the terms of this agreement and depending
upon the ultimate profitability or losses on certain projects, the collection of
the underlying receivables and the result of pending litigation. Quanta may be
required to make additional payments to such former owners with a combination of
common stock and cash. At September 30, 2003, the amount of additional payments
could equal up to $15.5 million, depending on the contingencies outlined above.
This amount may be adjusted significantly higher or lower over the term of the
agreement.

                                        15
<PAGE>
                     QUANTA SERVICES, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  Employment Agreements

     Quanta has entered into various employment agreements with certain
executives which provide for compensation and certain other benefits and for
severance payments under certain circumstances. In addition, certain employment
agreements contain clauses which become effective upon a change of control of
Quanta. Upon any of the defined events in the various employment agreements,
Quanta will pay certain amounts to the employee, which vary with the level of
the employee's responsibility.

  Collective Bargaining Agreements

     Certain of the subsidiaries are party to various collective bargaining
agreements with certain of their employees. The agreements require such
subsidiaries to pay specified wages and provide certain benefits to their union
employees. These agreements expire at various times.

  Other

     Quanta is subject to audit by tax authorities for varying periods in
various federal, state and local foreign tax jurisdictions. Disputes arise
during the course of such audits as to facts and matters of law.

     Quanta has indemnified various parties against specified liabilities that
those parties might incur in the future in connection with companies previously
acquired or disposed of by Quanta. These indemnities usually are contingent upon
the other party incurring liabilities that reach specified thresholds. As of
September 30, 2003, Quanta is not aware of circumstances that would lead to
future indemnity claims against it for material amounts in connection with these
transactions.

                                        16
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

INTRODUCTION

     The following discussion should be read in conjunction with the Condensed
Consolidated Financial Statements and related notes thereto included elsewhere
in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K,
which was filed with the SEC on March 31, 2003, as amended by Amendment No. 1
thereto on Form 10-K/A which was filed on October 2, 2003 and is available at
the SEC's Web site at www.sec.gov.

     We derive our revenues from one reportable segment by providing specialized
contracting services and offering comprehensive network solutions. Our customers
include electric power, gas, telecommunications and cable television companies,
as well as commercial, industrial and governmental entities.

     We enter into contracts principally on the basis of competitive unit price
or fixed price bids, the final terms and prices of which we frequently negotiate
with the customer. Although the terms of our contracts vary considerably, most
are made on either a unit price or fixed price basis in which we agree to do the
work for a price per unit of work performed (unit price) or for a fixed amount
for the entire project (fixed price). We also perform services on a cost-plus or
time and materials basis. We complete most installation projects within one
year, while we frequently provide maintenance and repair work under open-ended,
unit price or cost-plus master service agreements which are renewable annually.
We generally recognize revenue when services are performed except when work is
being performed under fixed price contracts. We typically record revenues from
fixed price contracts on a percentage-of-completion basis, using the
cost-to-cost method based on the percentage of total costs incurred to date in
proportion to total estimated costs to complete the contract. Some of our
customers require us to post performance and payment bonds upon execution of the
contract, depending upon the nature of the work to be performed. Our fixed price
contracts often include payment provisions pursuant to which the customer
withholds a 5% to 10% retainage from each progress payment and remits the
retainage to us upon completion and approval of the work.

     Cost of services consists primarily of salaries, wages and benefits to
employees, depreciation, fuel and other vehicle expenses, equipment rentals,
subcontracted services, insurance, facilities expenses, materials and parts and
supplies. Our gross margin, which is gross profit expressed as a percentage of
revenues, is typically higher on projects where labor, rather than materials,
constitutes a greater portion of the cost of services. We can predict materials
costs more accurately than labor costs. Therefore, to compensate for the
potential variability of labor costs, we seek higher margins on our
labor-intensive projects. Operating margins could be impacted by fluctuations in
insurance accruals related to our deductibles in the period in which such
adjustments are made. As of September 30, 2003, we had a deductible of
$1,000,000 per occurrence related to employer's liability and general liability
claims and a deductible of $2,000,000 per occurrence for automobile liability
and workers' compensation insurance. We also have a non-union employee related
health care benefit plan that is subject to a deductible of $250,000 per
claimant per year.

     Selling, general and administrative expenses consist primarily of
compensation and related benefits to management, administrative salaries and
benefits, marketing, office rent and utilities, communications, professional
fees and bad debt expense. Selling, general and administrative expenses can be
impacted by our customers' inability to pay for services performed.

SEASONALITY; FLUCTUATIONS OF QUARTERLY RESULTS

     Our results of operations can be subject to seasonal variations. During the
winter months, demand for new projects and new maintenance service arrangements
may be lower due to reduced construction activity. However, demand for repair
and maintenance services attributable to damage caused by inclement weather
during the winter months may partially offset the loss of revenues from lower
demand for new projects and new maintenance service arrangements. Additionally,
our industry can be highly cyclical. As a result, our volume of business may be
adversely affected by declines in new projects in various geographic regions in
the United States. Typically, we experience lower gross and operating margins
during the winter months due to lower demand for our services and more difficult
operating conditions. The financial condition of our

                                        17
<PAGE>

customers and their access to capital, variations in the margins of projects
performed during any particular quarter, the timing and magnitude of acquisition
assimilation costs, regional economic conditions and timing of acquisitions may
also materially affect quarterly results. Accordingly, our operating results in
any particular quarter may not be indicative of the results that can be expected
for any other quarter or for the entire year.

SIGNIFICANT BALANCE SHEET CHANGES

     Total assets increased $22.5 million as of September 30, 2003 compared to
December 31, 2002. These fluctuations were primarily due to the following:

     - Cash increased $49.9 million primarily due to the receipt of a $38.2
       million income tax refund in the second quarter of 2003, and the receipt
       of $7.1 million associated with the issuance of common stock.

     - Accounts receivable increased $21.6 million primarily due to a higher
       proportion of revenues for the third quarter being earned in the last
       month of the quarter.

     - Current deferred taxes decreased $22.2 million due to certain items that
       we deducted for tax purposes in the 2002 tax return, which were
       originally not expected to be deducted in 2002.

     - Prepaid expenses and other current assets increased $8.2 million due to
       the funding of a cash trust account for the current portion of
       self-insurance claims liability in the amount of $4.6 million and to a
       net change in prepayments for insurance policy renewals in the amount of
       $4.9 million, partially offset by monthly amortization of various prepaid
       balances.

     - Property and equipment, net decreased $23.5 million due to depreciation
       expense of $44.6 million recorded during the period and $2.9 million for
       the sale of equipment that was no longer being used by certain of our
       subsidiaries, partially offset by increases as a result of capital
       expenditures of $23.9 million.

     - Accounts and notes receivable, net decreased $15.2 million primarily due
       to additional allowances recorded during the nine months ended September
       30, 2003.

     - Other assets, net increased $5.2 million primarily due to the funding of
       a cash trust account for self-insurance in the amount of $3.8 million.

     As of September 30, 2003, total liabilities increased approximately $20.2
million, redeemable common stock decreased $72.9 million and stockholders'
equity increased approximately $75.1 million compared to December 31, 2002.
These fluctuations were primarily due to the following:

     - Deferred income taxes and other non-current liabilities increased $20.1
       million as a result of the recording of $13.7 million in additional
       long-term deferred tax liabilities due to increased differences between
       the book and tax bases of certain of our assets and an increase of $7.0
       million in the long-term portion of our self-insurance reserves.

     - Redeemable common stock decreased $72.9 million. On December 20, 2002,
       First Reserve purchased from us approximately 2.4 million shares of newly
       issued Series E Preferred Stock at $30.00 per share, for an investment of
       approximately $72.9 million. The shares of Series E Preferred Stock were
       converted into 24.3 million shares of common stock on December 31, 2002.
       Through February 20, 2003, First Reserve had the right to require us to
       repurchase for cash the shares of common stock issued as a result of the
       conversion of the shares of Series E Preferred Stock if we had a change
       in control. As such, the investment had been reflected in the
       consolidated balance sheet as redeemable common stock at December 31,
       2002. On February 20, 2003, at the expiration of the right, the
       redeemable common stock was reclassified to stockholders' equity.

     - Stockholders' equity increased $75.1 million primarily due to the
       reclassification of redeemable common stock of $72.9 million to
       stockholders' equity, the issuance of approximately $3.5 million of
       common stock pursuant to our Employee Stock Purchase Plan, the issuance
       of approximately $3.6 million of common stock pursuant to First Reserve's
       exercise of their preemptive rights and the

                                        18
<PAGE>

       net effect of restricted stock in the amount of $1.6 million. These
       increases were partially offset by a net loss attributable to common
       stock of $7.2 million.

RESULTS OF OPERATIONS

     The following table sets forth selected unaudited statements of operations
data and such data as a percentage of revenues for the periods indicated:

<Table>
<Caption>
                                   THREE MONTHS ENDED SEPTEMBER 30,         NINE MONTHS ENDED SEPTEMBER 30,
                                  -----------------------------------   ---------------------------------------
                                        2002               2003                2002                 2003
                                  ----------------   ----------------   ------------------   ------------------
                                                             (DOLLARS IN THOUSANDS)
<S>                               <C>        <C>     <C>        <C>     <C>          <C>     <C>          <C>
Revenues........................  $436,215   100.0%  $436,133   100.0%  $1,317,957   100.0%  $1,211,564   100.0%
Cost of services (including
  depreciation).................   381,947    87.6    381,125    87.4    1,139,842    86.5    1,065,281    87.9
                                  --------   -----   --------   -----   ----------   -----   ----------   -----
      Gross profit..............    54,268    12.4     55,008    12.6      178,115    13.5      146,283    12.1
Selling, general and
  administrative expenses.......    68,747    15.7     38,886     8.9      178,956    13.6      135,963    11.2
Goodwill impairment.............        --      --         --      --      166,580    12.6           --      --
                                  --------   -----   --------   -----   ----------   -----   ----------   -----
      Income (loss) from
         operations.............   (14,479)   (3.3)    16,122     3.7     (167,421)  (12.7)      10,320     0.9
Interest expense................    (9,807)   (2.2)    (8,080)   (1.8)     (25,696)   (1.9)     (24,182)   (2.0)
Other income, net...............    (1,674)   (0.4)       182      --          (56)     --           72      --
                                  --------   -----   --------   -----   ----------   -----   ----------   -----
Income (loss) before income tax
  provision (benefit) and
  cumulative effect of change in
  accounting principle..........   (25,960)   (5.9)     8,224     1.9     (193,173)  (14.6)     (13,790)   (1.1)
Provision (benefit) for income
  Taxes.........................   (17,644)   (4.0)     2,825     0.7      (17,926)   (1.3)      (4,511)   (0.3)
                                  --------   -----   --------   -----   ----------   -----   ----------   -----
Income (loss) before cumulative
  effect of change in accounting
  principle.....................    (8,316)   (1.9)     5,399     1.2     (175,247)  (13.3)      (9,279)   (0.8)
Cumulative effect of change in
  accounting principle, net of
  tax...........................        --      --         --      --      445,422    33.8           --      --
                                  --------   -----   --------   -----   ----------   -----   ----------   -----
  Net income (loss).............    (8,316)   (1.9)     5,399     1.2     (620,669)  (47.1)      (9,279)   (0.8)
Dividends on preferred stock,
  net of forfeitures............       234      --         --      --          698     0.1       (2,109)   (0.2)
                                  --------   -----   --------   -----   ----------   -----   ----------   -----
  Net income (loss) attributable
    to common stock.............  $ (8,550)   (1.9)% $  5,399     1.2%  $ (621,367)  (47.2)% $   (7,170)   (0.6)%
                                  ========   =====   ========   =====   ==========   =====   ==========   =====
</Table>

  THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2003, COMPARED TO THE THREE AND NINE
  MONTHS ENDED SEPTEMBER 30, 2002

     Revenues.  Revenues did not vary significantly from period to period for
the three months ended September 30, 2003. Revenues decreased $106.4 million to
$1.21 billion, or 8.1%, for the nine months ended September 30, 2003, with
revenues derived from the cable television network services industry decreasing
by approximately $76.0 million, revenues from the telecommunications network
services industry decreasing by approximately $43.5 million and revenues from
ancillary services decreasing approximately $9.2 million. These decreases were
partially offset by increases in revenues derived from the electric power and
gas network services industry of approximately $22.3 million. The overall
decrease was due to the continued decrease in capital spending by our customers,
the inability of certain of these customers to raise new capital, and the
continued downturn in the national economy, which have negatively impacted the
award of work to specialty contractors. Pricing pressures have also contributed
to lower revenues as the competitive bid environment has tightened.

                                        19
<PAGE>

     Gross profit.  Gross profit increased $0.7 million, or 1.4%, to $55.0
million for the three months ended September 30, 2003; as a percentage of
revenues, gross margin did not vary significantly from period to period. Gross
profit decreased $31.8 million, or 17.9%, to $146.3 million for the nine months
ended September 30, 2003. As a percentage of revenue, gross margin decreased
from 13.5% for the nine months ended September 30, 2002 to 12.1% for the nine
months ended September 30, 2003. The decrease in gross margin was attributable
to shutdowns, delays and substantial operating inefficiencies resulting from
severe snowfall in the Northeast and Mountain regions of the United States
during the first quarter of 2003, substantially higher than normal rainfall
amounts in the South and Southeast during the first and second quarters of 2003
and negative impacts due to the economic factors and pricing pressures noted
above, partially offset by increased margins on telecommunications revenues
during the second quarter of 2003.

     Selling, general and administrative expenses.  Selling, general and
administrative expenses decreased $29.9 million, or 43.4%, to $38.9 million for
the three months ended September 30, 2003. During the three months ended
September 30, 2002, we recorded $25.7 million in bad debt expense compared to
$0.5 million during the three months ended September 30, 2003. Absent bad debt
expense, selling, general and administrative expenses for the three months ended
September 30, 2003 decreased $4.7 million primarily due to reductions in salary
and benefit costs, facility related costs and travel and entertainment costs as
a result of reductions in personnel and the closure of certain offices. Selling,
general and administrative expenses decreased $43.0 million, or 24.0%, to $136.0
million for the nine months ended September 30, 2003. During the nine months
ended September 30, 2002, we recorded $34.3 million in bad debt expense and
proxy defense costs in the amount of $10.5 million. During the nine months ended
September 30, 2003, we recorded $19.8 million in bad debt expense. Absent these
items, selling, general and administrative expenses for the nine months ended
September 30, 2003 decreased $18.0 million primarily due to reductions in salary
and benefit costs, facility related costs and travel and entertainment costs as
a result of reductions in personnel and the closure of certain offices.

     Goodwill impairment.  During the nine months ended September 30, 2002, we
recognized an interim non-cash SFAS No. 142 goodwill impairment charge of $166.6
million. Any interim impairment adjustments recognized after adoption are
required to be recognized as operating expenses. The primary factor contributing
to the interim impairment charge was the overall deterioration of the business
climate during 2002 in the markets we serve. We did not recognize an interim
non-cash goodwill impairment charge during the nine months ended September 30,
2003.

     Interest expense.  Interest expense decreased $1.7 million, or 17.6%, to
$8.1 million for the three months ended September 30, 2003. This decrease was
due to lower levels of debt in 2003, partially offset by increased interest
rates. Interest expense decreased $1.5 million, or 5.9%, to $24.2 million for
the nine months ended September 30, 2003, also due to lower levels of debt in
2003, partially offset by increased interest rates.

     Provision (benefit) for income taxes.  The provision for income taxes was
$2.8 million for the three months ended September 30, 2003, with an effective
tax rate of 34.4%, compared to a benefit of $17.6 million for the three months
ended September 30, 2002, with an effective tax rate of 68.0%. The benefit for
income taxes was $4.5 million for the nine months ended September 30, 2003, with
an effective tax rate of 32.7%, compared to a benefit of $17.9 million, with an
effective tax rate of 9.3% for the nine months ended September 30, 2002. The
2003 estimated annual effective tax rate reflects a benefit for income taxes at
a rate that is lower than the combined federal and blended state tax rate due to
tax expense on permanent differences. The tax rates in 2002 reflect the
recording of the net realizable benefit relating to the goodwill impairment
charge offset by tax expense on permanent differences.

     Cumulative effect of change in accounting principle, net of tax.  Based on
our transitional impairment test performed upon adoption of SFAS No. 142 in
2002, we recognized a charge, net of tax, of $445.4 million to reduce the
carrying value of the goodwill of our reporting units to its implied fair value.
Under SFAS No. 142, the impairment adjustment recognized at adoption of the new
rule was reflected as a cumulative effect of change in accounting principle in
the nine months ended September 30, 2002.

     Dividends on preferred stock, net of forfeitures.  For the nine months
ended September 30, 2003, we recorded approximately $2.1 million in forfeitures
of dividends on the Series A Convertible Preferred Stock.
                                        20
<PAGE>

During the first quarter of 2003, all outstanding shares of Series A Convertible
Preferred Stock were converted into shares of common stock and the series was
eliminated during the second quarter of 2003. Any dividends that had accrued on
the respective shares of Series A Convertible Preferred Stock were reversed on
the date of conversion.

LIQUIDITY AND CAPITAL RESOURCES

     As of September 30, 2003, we had cash and cash equivalents of $77.8
million, working capital of $371.8 million and long-term debt of $384.0 million,
net of current maturities. Our long-term debt balance at that date included
borrowings of $210.0 million of senior secured notes, $1.5 million of other debt
and $172.5 million of convertible subordinated notes.

     During the nine months ended September 30, 2003, operating activities
provided net cash flow of $76.7 million after considering $45.1 million in
depreciation and amortization, $19.8 million for provision for doubtful accounts
and $35.9 million for deferred income taxes. We used net cash in investing
activities of $30.5 million, including $23.9 million used for capital
expenditures and $8.4 million used to fund a cash trust account for our
self-insurance. Financing activities provided net cash flow of $3.6 million,
resulting primarily from approximately $3.5 million from the issuance of stock
under the Employee Stock Purchase Plan (ESPP) and approximately $3.6 million for
shares of common stock sold pursuant to First Reserve's exercise of their
preemptive rights, partially offset by $3.1 million of net repayments of other
long-term debt and $0.3 million of debt issuance costs.

     As of September 30, 2003, we had a $225.0 million credit facility with 14
participating banks, which would have matured on June 14, 2004. The credit
facility was secured by a pledge of substantially all of the capital stock of
our subsidiaries and the majority of our assets and was to provide funds to be
used for working capital and for other general corporate purposes. Our
subsidiaries guaranteed the repayment of all amounts due under the facility and
the facility restricted pledges on all material assets. Amounts borrowed under
the credit facility bore interest at a rate equal to either (a) LIBOR plus 1.50%
to 3.50%, as determined by the ratio of our total funded debt to EBITDA (as
defined by the credit facility) or (b) the bank's prime rate plus up to 2.00%,
as determined by the ratio of our total funded debt to EBITDA. Commitment fees
of 0.375% to 0.50%, based on our total funded debt to EBITDA, were due on any
unused borrowing capacity under the credit facility. The credit facility
contained certain financial ratio and indebtedness covenants, including a
maximum funded debt to EBITDA ratio, a minimum interest coverage ratio and a
maximum senior debt to EBITDA ratio. The credit facility also prohibited the
payment of dividends and stock repurchase programs and limited capital
expenditures and asset sales. Additionally the credit facility required a
mandatory reduction in the banks' commitment by a portion of the proceeds from
asset sales in excess of $5.0 million annually or upon the issuance of
additional debt in excess of $15.0 million. As of September 30, 2003, we had
$90.7 million of letters of credit outstanding under the credit facility,
primarily to secure our potential obligations under the casualty insurance
programs.

     In November 2003, we amended our credit facility to convert it into a fully
funded term loan of $60.0 million and a letter of credit facility of up to
$120.0 million with one bank, maturing on January 1, 2005. The term loan was
used to repay a portion of the senior secured notes, discussed below. Amounts
borrowed under the term loan bear interest at a rate equal to LIBOR plus 3.25%.
The credit facility as amended is secured by a pledge of substantially all of
the capital stock of our subsidiaries and the majority of our assets. Our U.S.
subsidiaries guarantee the repayment of all amounts due under the facility and
the facility restricts pledges on all material assets. The facility contains
certain financial ratio and indebtedness covenants including a maximum funded
debt to EBITDA ratio, a minimum interest coverage ratio and a maximum senior
debt to EBITDA ratio, that are generally less restrictive than those in
existence prior to amendment. The facility also prohibits the payment of
dividends and stock repurchase programs and limits capital expenditures and
asset sales. The facility requires cash collateralization of all letters of
credit, and we have collateralized the $90.7 million in letters of credit that
were outstanding as of September 30, 2003. As a result of the amendment, $1.1
million in unamortized deferred financing costs will be expensed into interest
expense during the fourth quarter of 2003.

                                        21
<PAGE>

     We currently have a commitment from a lender for a new $200.0 million
credit facility, subject to certain conditions precedent. We anticipate closing
the new credit facility in the fourth quarter of 2003 and plan to pay off the
above discussed term loan and letter of credit facility with the proceeds of the
new facility.

     As of September 30, 2003, we had $172.5 million in convertible subordinated
notes outstanding. These convertible subordinated notes bear interest at 4.0%
per year and are convertible into shares of our common stock at a price of
$54.53 per share, subject to adjustment as a result of certain events. These
convertible subordinated notes require semi-annual interest payments until the
notes mature on July 1, 2007. We have the option to redeem some or all of the
convertible subordinated notes beginning July 3, 2003 at specified redemption
prices, together with accrued and unpaid interest; however, redemption is
prohibited by our credit facility as amended. If certain fundamental changes
occur, as described in the indenture under which we issued the convertible
subordinated notes, holders of the convertible subordinated notes may require us
to purchase all or part of their notes at a purchase price equal to 100% of the
principal amount, plus accrued and unpaid interest. In the event of such
circumstance, consent to repurchase the convertible subordinated notes would be
required under our credit facility as amended.

     In October 2003, we issued $270.0 million principal amount of convertible
subordinated notes. These convertible subordinated notes bear interest at 4.5%
per year and are convertible into shares of Quanta's common stock at a price of
$11.14 per share, subject to adjustment as a result of certain events. We used
the net proceeds to repay a portion of the senior secured notes, discussed
below, and to cash collateralize the letters of credit under the credit facility
as amended. The convertible subordinated notes require semi-annual interest
payments beginning April 1, 2004, until the notes mature on October 1, 2023.

     The 4.5% convertible subordinated notes are convertible by the holder if
(i) during any fiscal quarter commencing after December 31, 2003 the last
reported sale price of our common stock is greater than or equal to 120% of the
conversion price for at least 20 trading days in the period of 30 consecutive
trading days ending on the first trading day of such fiscal quarter, (ii) during
the five business day period after any five consecutive trading day period in
which the trading price per note for each day of that period was less than 98%
of the product of the last reported sale price of our common stock and the
conversion rate, (iii) upon us calling the notes for redemption or (iv) upon the
occurrence of specified corporate transactions. If the notes become convertible
under one of these circumstances, we have the option to deliver cash, shares of
our common stock or a combination thereof, with a valve equal to the par value
of the notes divided by the conversion price multiplied by the average trading
price of our common stock. The maximum number of shares of common stock that
could be issued under these circumstances is equal to the par value of the notes
divided by the conversion price.

     Beginning October 8, 2008, we may redeem for cash some or all of the 4.5%
convertible subordinated notes at par value plus accrued and unpaid interest.
The holders of the notes may require us to repurchase some or all of the notes
at par value plus accrued and unpaid interest on October 1, 2008, 2013, or 2018,
or upon the occurrence of a fundamental change, as defined by the indenture
under which we issued the notes. Any repurchases on October 1, 2008 must be paid
in cash, and for all other repurchases, we have the option of settling with
cash, shares of our common stock or a combination thereof. If we elect to settle
with shares of common stock, the number of shares delivered will equal the
dollar amount to be paid in common stock divided by 98.5% of the market price of
our common stock, as defined by the indenture. The number of shares to be issued
under this circumstance is not limited. The right to settle for shares of common
stock can be surrendered by us.

     As of September 30, 2003, we had $210.0 million principal amount of senior
secured notes outstanding, primarily with insurance companies, with maturities
currently ranging from March 2005 to September 2010. The senior secured notes
bore interest at a weighted average interest rate between 8.41% and 9.91% as
determined by the ratio of our total funded debt to EBITDA. The weighted average
interest rate as of September 30, 2003 was 9.91%. In addition, the senior
secured notes carried a make-whole provision customary for this type of debt
instrument on prepayment of principal, including any mandatory prepayments. The
senior secured notes carried cross-default provisions and ranked equally in
right of repayment with indebtedness under our then existing credit facility.

                                        22
<PAGE>

     In the fourth quarter of 2003, we retired the $210.0 million of senior
secured notes and paid associated make-whole prepayment premiums in the amount
of $31.3 million. The make-whole prepayment premiums, along with related
unamortized deferred financing costs in the amount of approximately $2.6
million, will be expensed in the fourth quarter of 2003.

     On December 20, 2002, First Reserve purchased from us approximately 2.4
million shares of newly issued Series E Preferred Stock at $30.00 per share, for
an investment of approximately $72.9 million. The Series E Preferred Stock was
converted into 24.3 million shares of common stock on December 31, 2002 and the
series was eliminated during the second quarter of 2003. Through February 20,
2003, First Reserve had the right to require us to repurchase for cash the
shares of common stock issued as a result of the conversion of the shares of
Series E Preferred Stock if we had a change in control. As such, the investment
was reflected in the consolidated balance sheet as redeemable common stock at
December 31, 2002. On February 20, 2003, at the expiration of this right, the
redeemable common stock was reclassified to stockholders' equity.

     During the first quarter of 2003, all outstanding shares of Series A
Convertible Preferred Stock were converted into shares of common stock and the
series was eliminated during the second quarter of 2003. Dividends of $2.3
million that had accrued on the shares of Series A Convertible Preferred Stock,
which included $0.2 million accrued during the first quarter of 2003, were
reversed on the date of the conversion.

     As of November 12, 2003, after considering the refinancing transactions
discussed above, we have approximately $63 million in unrestricted cash. We
anticipate that our cash on hand and cash flow from operations will provide
sufficient cash to enable us to meet our working capital needs, debt service
requirements and planned capital expenditures for property and equipment for at
least the next 12 months. However, further deterioration in the markets we
serve, material changes in our customers' revenues or cash flows or adverse
weather conditions may negatively impact our revenues and cash flows and the
ability to meet such needs.

     Other Commitments.  As is common in our industry, we have entered into
certain off-balance sheet arrangements in the ordinary course of business that
result in risks not directly reflected in our balance sheets. Our significant
off-balance sheet transactions include liabilities associated with
non-cancelable operating leases, letter of credit obligations and surety
guarantees. We have not engaged in any off-balance sheet financing arrangements
through special purpose entities.

     We enter into non-cancelable operating leases for many of our facility,
vehicle and equipment needs. These leases allow us to conserve cash by paying a
monthly lease rental fee for use of facilities, vehicles and equipment rather
than purchasing them. At the end of the lease, we have no further obligation to
the lessor. We may decide to cancel or terminate a lease before the end of its
term, in which case we are typically liable to the lessor for the remaining
lease payments under the term of the lease.

     We have guaranteed a residual value on certain equipment operating leases.
We guarantee the difference between this residual value and the fair market
value of the underlying asset at the date of termination of the leases. At
September 30, 2003, the maximum guaranteed residual value would have been
approximately $121.8 million. We believe that no significant payments will be
made as a result of the difference between the fair market value of the leased
equipment and the guaranteed residual value. However, there can be no assurance
that future significant payments will not be required.

     Some customers require us to post letters of credit to guarantee
performance under our contracts and to ensure payment to our subcontractors and
vendors under those contracts. Certain of our vendors also require letters of
credit to ensure reimbursement for amounts they are disbursing on our behalf,
such as to beneficiaries under our self-funded insurance programs. Such letters
of credit are generally issued by a bank or similar financial institution. The
letter of credit commits the issuer to pay specified amounts to the holder of
the letter of credit if the holder demonstrates that we have failed to perform
specified actions. If this were to occur, we would be required to reimburse the
issuer of the letter of credit. Depending on the circumstances of such a
reimbursement, we may also have to record a charge to earnings for the
reimbursement. To date, we have not had a claim made against a letter of credit
that resulted in payments by the issuer of the letter of

                                        23
<PAGE>

credit or by us and do not believe that it is likely that any claims will be
made under a letter of credit in the foreseeable future.

     As of September 30, 2003, we had $90.7 million in letters of credit
outstanding under our credit facility primarily to secure obligations under our
casualty insurance program. These are irrevocable stand-by letters of credit
with maturities expiring at various times throughout 2003 and 2004. Upon
maturity, it is expected that the majority of these letters of credit will be
renewed for subsequent one-year periods. The credit facility as amended requires
cash collateralization of all letters of credit, and we have collateralized the
$90.7 million in letters of credit that were outstanding as of September 30,
2003.

     We are contractually obligated to fund our casualty self-insurance
obligations applicable to the policy period from March 1, 2003 to February 29,
2004 with a combination of a cash trust account of $14.4 million and letters of
credit totaling $24.4 million. Through September 30, 2003, we had funded the
cash trust account with $10.8 million and issued $18.6 million in letters of
credit pursuant to the policy period from March 1, 2003 to February 29, 2004.

     Many customers, particularly in connection with new construction, require
us to post performance and payment bonds issued by a financial institution known
as a surety. These bonds provide a guarantee to the customer that we will
perform under the terms of a contract and that we will pay subcontractors and
vendors. If we fail to perform under a contract or to pay subcontractors and
vendors, the customer may demand that the surety make payments or provide
services under the bond. We must reimburse the surety for any expenses or
outlays it incurs. To date, we have not had any significant reimbursements to
our surety for bond-related costs. We believe that it is unlikely that we will
have to fund claims under our surety arrangements in the foreseeable future. As
of September 30, 2003, the total amount of outstanding performance bonds was
approximately $515.6 million.

     As of September 30, 2003, our future contractual obligations, including
interest under capital leases, were as follows (in thousands):

<Table>
<Caption>
                                  TOTAL      2003     2004       2005      2006      2007     THEREAFTER
                                 --------   ------   -------   --------   ------   --------   ----------
<S>                              <C>        <C>      <C>       <C>        <C>      <C>        <C>
Long-term debt obligations
  including capital leases.....  $389,181   $3,399   $ 2,200   $103,802   $5,263   $214,017    $60,500
Operating lease obligations....  $ 42,131   $4,880   $14,734   $ 10,421   $5,304   $  2,309    $ 4,483
</Table>

     Concentration of Credit Risk.  We grant credit, generally without
collateral, to our customers, which include electric power and gas companies,
telecommunications and cable television system operators, governmental entities,
general contractors, and builders, owners and managers of commercial and
industrial properties located primarily in the United States. Consequently, we
are subject to potential credit risk related to changes in business and economic
factors throughout the United States. However, we generally have certain lien
rights on our services provided. Under certain circumstances, such as
foreclosures or negotiated settlements, we may take title to the underlying
assets in lieu of cash in settlement of receivables. As previously discussed
herein, our customers in the telecommunications business have experienced
significant financial difficulties and in several instances have filed for
bankruptcy. A number of our utility customers are also experiencing business
challenges in the current business climate. These economic conditions expose us
to increased risk related to collectibility of receivables for services we have
performed.

     In June 2002, a large customer, Adelphia Communications Corporation
(Adelphia), filed for bankruptcy protection under Chapter 11 of the Bankruptcy
Code, as amended. We have filed liens on various properties to secure
substantially all of our pre-petition receivables. Our carrying value is based
upon our understanding of the current status of the Adelphia bankruptcy
proceeding and a number of assumptions, including assumptions about the
validity, priority and enforceability of our security interests. We currently
believe we will collect a substantial majority of the balances owed. Should any
of the factors underlying our estimate change, the amount of our allowance could
change significantly. We are uncertain as to whether such receivables will be
collected within one year and therefore have included this amount in non-current
assets as Accounts and Notes Receivable as of June 30, 2003. Also included in
non-current Accounts and Notes Receivable are amounts due from another customer
relating to the construction of independent power plants. We have agreed

                                        24
<PAGE>

to long-term payment terms for this customer. The notes receivable are partially
secured and bear interest at 9.5% per year. We have provided allowances for
these notes receivable due to a substantial deterioration in the estimated
future cash flows of the plants, resulting in a carrying value equal to the
estimated value of the collateral securing these notes. As of September 30,
2003, the total long-term balances due from both of these customers was $81.2
million, net of an allowance for doubtful accounts of $46.3 million.

     Litigation.  We are from time to time a party to various lawsuits, claims
and other legal proceedings that arise in the ordinary course of business. These
actions typically seek, among other things, compensation for alleged personal
injury, breach of contract, property damage, punitive damages, civil penalties
or other losses, or injunctive or declaratory relief. With respect to all such
lawsuits, claims and proceedings, we accrue reserves when it is probable a
liability has been incurred and the amount of loss can be reasonably estimated.
We do not believe that any of these proceedings, separately or in the aggregate
would be expected to have a material adverse effect on our results of operations
or financial position.

     Change of Control.  We have employment agreements with certain employees
that become effective upon a change of control of Quanta (as defined in the
employment agreements). The employment agreements provide that, following a
change in control, if we terminate the employee's employment without cause (as
defined in the employment agreements), the employee terminates employment for
good reason (as defined in the employment agreements), or the employee's
employment terminates due to death or disability, we will pay certain amounts to
the employee, which may vary with the level of the employee's responsibility and
the terms of the employee's prior employment arrangements. In addition, in the
case of certain senior executives except Mr. Colson, our chief executive
officer, these payments would also be due if the employee terminates his or her
employment within the 30-day window period commencing six months after the
change in control.

     Related Party Transactions.  In the normal course of business, we from time
to time enter into transactions with related parties. These transactions
typically take the form of facility leases with prior owners.

NEW ACCOUNTING PRONOUNCEMENTS

     In May 2003, the FASB issued SFAS No. 149 "Amendment of Statement 133 on
Derivative Instruments and Hedging Activities." SFAS No. 149 amends and
clarifies financial accounting and reporting for derivative instruments,
including certain derivative instruments embedded in other contracts and for
hedging activities under SFAS No. 133. This statement is effective for contracts
entered into or modified after June 30, 2003 (with certain exceptions) and for
hedging relationships entered into after June 30, 2003. We do not have any
financial instruments that fall under the scope of this statement and do not
believe that the adoption of SFAS No. 149 will have a material effect on either
our financial position, results of operations or cash flows.

     In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain
Financial Instruments with Characteristics of both Liabilities and Equity." SFAS
No. 150 establishes standards for classifying and measuring certain financial
instruments with characteristics of both liabilities and equity. Financial
instruments that fall within the scope of SFAS No. 150 will be classified as
liabilities (or an asset in some circumstances). This statement is effective at
the beginning of the first interim period beginning after June 15, 2003. The
adoption of SFAS No. 150 did not have a material impact on our results of
operations or financial position.

CRITICAL ACCOUNTING POLICIES

     The discussion and analysis of our financial condition and results of
operations are based on our consolidated financial statements, which have been
prepared in accordance with accounting principles generally accepted in the
United States. The preparation of these consolidated financial statements
requires us to make estimates and assumptions that affect the reported amounts
of assets and liabilities, disclosures of contingent assets and liabilities
known to exist at the date of the consolidated financial statements and the
reported amounts of revenues and expenses during the reporting period. We
evaluate our estimates on an ongoing basis, based on historical experience and
on various other assumptions that are believed to be reasonable under the
circumstances. There can be no assurance that actual results will not differ
from those
                                        25
<PAGE>

estimates. Management has reviewed its development and selection of critical
accounting estimates with the audit committee of our board of directors. We
believe the following accounting policies affect our more significant judgments
and estimates used in the preparation of our consolidated financial statements:

          Current and Non-Current Accounts and Notes Receivable and Provision
     for Doubtful Accounts. We provide an allowance for doubtful accounts when
     collection of an account or note receivable is considered doubtful.
     Inherent in the assessment of the allowance for doubtful accounts are
     certain judgments and estimates including, among others, our customer's
     access to capital, our customer's willingness or ability to pay, general
     economic conditions and the ongoing relationship with the customer. For
     example, certain of our customers, primarily large public
     telecommunications carriers, have filed for bankruptcy or have been
     experiencing financial difficulties, and as a result we increased our
     allowance for doubtful accounts to reflect that certain customers may be
     unable to meet their obligations to us in the future. Should additional
     customers file for bankruptcy or experience difficulties, or should
     anticipated recoveries relating to the receivables in existing bankruptcies
     and other workout situations fail to materialize, we could experience
     reduced cash flows and losses in excess of current reserves.

          Goodwill and Other Intangibles.  As stated in Note 5 of Notes to
     Condensed Consolidated Financial Statements, SFAS No. 142 provides that
     goodwill and other intangible assets that have indefinite useful lives not
     be amortized, but instead must be tested at least annually for impairment,
     and intangible assets that have finite useful lives should continue to be
     amortized over their useful lives. SFAS No. 142 also provides specific
     guidance for testing goodwill and other nonamortized intangible assets for
     impairment. Goodwill of a reporting unit shall be tested for impairment
     between annual tests if an event occurs or circumstances change that would
     more likely than not reduce the fair value of a reporting unit below its
     carrying amount. Examples of such events or circumstances may include a
     significant change in business climate or a loss of key personnel, among
     others. SFAS No. 142 requires that management make certain estimates and
     assumptions in order to allocate goodwill to reporting units and to
     determine the fair value of reporting unit net assets and liabilities,
     including, among other things, an assessment of market conditions,
     projected cash flows, cost of capital and growth rates, which could
     significantly impact the reported value of goodwill and other intangible
     assets. Estimating future cash flows requires significant judgment and our
     projections may vary from cash flows eventually realized.

          Late in the second quarter of 2003, a dispute developed between one of
     our subsidiaries and its primary customer, leading to a suspension of work
     for that customer. It is unclear whether the dispute will be resolved
     favorably or whether work for this customer will resume. If the dispute
     settles unfavorably for the subsidiary or the subsidiary is unable to
     replace this work with comparable cash flows, we may record a non-cash
     goodwill impairment charge of up to $6.5 million.

          Revenue Recognition.  We typically record revenues from fixed price
     contracts on a percentage-of-completion basis, using the cost-to-cost
     method based on the percentage of total costs incurred to date in
     proportion to total estimated costs to complete the contract. Changes in
     job performance, job conditions and final contract settlements, among
     others, are factors that influence the assessment of the total estimated
     costs to complete these contracts.

          Self-Insurance.  We are insured for employer's liability and general
     liability claims, subject to a deductible of $1,000,000 per occurrence, and
     for auto liability and workers' compensation insurance subject to a
     deductible of $2,000,000 per occurrence. We also have a corporate non-union
     employee related health care benefit plan that is subject to a deductible
     of $250,000 per claimant per year. Losses up to the deductible amounts are
     accrued based upon our estimates of the ultimate liability for claims
     incurred and an estimate of claims incurred but not reported. However,
     insurance liabilities are difficult to assess and estimate due to unknown
     factors, including the severity of an injury, the determination of our
     liability in proportion to other parties, the number of incidents not
     reported and the effectiveness of our safety program. The accruals are
     based upon known facts and historical trends and management believes such
     accruals to be adequate.

          Stock Options.  We account for our stock-based compensation under
     Accounting Principles Board Opinion No. 25 (APB Opinion No. 25),
     "Accounting for Stock Issued to Employees." Under this
                                        26
<PAGE>

     accounting method, no compensation expense is recognized in the
     consolidated statements of operations if no intrinsic value of the option
     exists at the date of grant. In October 1995, the FASB issued SFAS No. 123,
     "Accounting for Stock Based Compensation." SFAS No. 123 encourages
     companies to account for stock-based compensation awards based on the fair
     value of the awards at the date they are granted. The resulting
     compensation costs would be shown as an expense in the consolidated
     statements of operations. Companies can choose not to apply the new
     accounting method and continue to apply current accounting requirements;
     however, disclosure is required as to what net income and earnings per
     share would have been had the new accounting method been followed.

          As a result of our stock option exchange offer during the first
     quarter of 2003, certain stock options are required to be accounted for
     under variable plan accounting. See additional discussion in Note 7 to the
     Notes to Condensed Consolidated Financial Statements.

OUTLOOK

     The following statements are based on current expectations. These
statements are forward looking, and actual results may differ materially.

     Like many companies that provide installation and maintenance services to
the electrical power, gas, telecommunications and cable television industries,
we are facing a number of challenges. The telecommunications and utility markets
experienced substantial change during 2002 as evidenced by an increased number
of bankruptcies in the telecommunications market, continued devaluation of many
of our customers' debt and equity securities and pricing pressures resulting
from challenges faced by major industry participants. These factors have
contributed to the delay and cancellation of projects and reduction of capital
spending that have impacted our operations and ability to grow at historical
levels.

     We continue to focus on the elements of the business we can control,
including cost control, the margins we accept on projects, collecting
receivables, ensuring quality service and right sizing initiatives to match the
markets we serve. These initiatives include aligning our work force with our
current revenue base, evaluating opportunities to reduce the number of field
offices and evaluating our non-core assets for potential sale. Such initiatives
could result in future charges related to, among others, severance, facilities
shutdown and consolidation, property disposal and other exit costs as we execute
these initiatives.

     We expect consistent demand for our services from our electric power and
gas customers throughout 2003 and 2004 with stabilization in the demand for our
services from our telecommunications and cable customers and relatively level
demand for our ancillary services. Financial and economic pressures have led our
customers to return to their core competencies and focus on cost reductions,
resulting in an increased focus on outsourcing services. We believe that we are
adequately positioned to provide these services because of our proven
full-service operating units with broad geographic reach, financial capability
and technical expertise.

     Capital expenditures in 2003 are expected to be approximately $30.0
million. A majority of the expenditures will be for operating equipment. We
expect expenditures for 2003 to be funded substantially through internal cash
flows and, to the extent necessary, from cash on hand.

UNCERTAINTY OF FORWARD-LOOKING STATEMENTS AND INFORMATION

     This Quarterly Report on Form 10-Q includes statements reflecting
assumptions, expectations, projections, intentions or beliefs about future
events that are intended as "forward-looking statements" under the Private
Securities Litigation Reform Act of 1995. You can identify these statements by
the fact that they do not relate strictly to historical or current facts. They
use words such as "anticipate," "estimate," "project," "forecast," "may,"
"will," "should," "could," "expect," "believe" and other words of similar
meaning. In particular, these include, but are not limited to, statements
relating to the following:

     - Projected operating or financial results;

     - Expectations regarding capital expenditures;

                                        27
<PAGE>

     - The effects of competition in our markets;

     - The duration and extent of the current economic downturn;

     - Materially adverse changes in economic conditions in the markets served
       by us or by our customers, and;

     - Our ability to achieve cost savings.

Any or all of our forward-looking statements may turn out to be wrong. They can
be affected by inaccurate assumptions and by known or unknown risks and
uncertainties, including the following:

     - The duration and extent of the current economic downturn;

     - The cost of borrowing, availability of credit, debt covenant compliance
       and other factors affecting our financing activities;

     - Quarterly variations in our operating results due to seasonality and
       adverse weather conditions;

     - Material adverse changes in economic conditions in the markets served by
       us or by our customers;

     - The adverse impact of goodwill impairments;

     - Replacement of our contracts as they are completed or expire;

     - Rapid technological and structural changes that could reduce the demand
       for the services we provide;

     - Our ability to effectively compete for market share;

     - Our ability to generate internal growth;

     - Our growth outpacing our infrastructure;

     - Retention of key personnel and qualified employees;

     - The impact of our unionized workforce on our operations and acquisition
       strategy;

     - Potential exposure to environmental liabilities;

     - Our ability to effectively integrate the operations of our companies;

     - Beliefs and assumptions about the collectibility of receivables;

     - Our dependence on fixed price contracts;

     - Cancellation provisions within our contracts; and

     - Beliefs or assumptions about the outlook for markets we serve.

     Many of these factors will be important in determining our actual future
results. Consequently, no forward-looking statement can be guaranteed. Our
actual future results may vary materially from those expressed or implied in any
forward-looking statements.

     All of our forward-looking statements, whether written or oral, are
expressly qualified by these cautionary statements and any other cautionary
statements that may accompany such forward-looking statements. In addition, we
disclaim any obligation to update any forward-looking statements to reflect
events or circumstances after the date of this report.

ITEM 4.  CONTROLS AND PROCEDURES

     Our management evaluated, with the participation of our Chairman and Chief
Executive Officer and Chief Financial Officer the effectiveness of our
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934, as amended (Exchange Act)), as of
September 30, 2003. Based on their evaluation, our Chairman and Chief Executive
Officer and Chief

                                        28
<PAGE>

Financial Officer concluded that our disclosure controls and procedures were
effective as of September 30, 2003.

     There has been no change in our internal control over financial reporting
(as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that
occurred during the quarter ended September 30, 2003, that has materially
affected, or is reasonably likely to materially affect, our internal control
over financial reporting.

                          PART II -- OTHER INFORMATION

                     QUANTA SERVICES, INC. AND SUBSIDIARIES

ITEM 1.  LEGAL PROCEEDINGS

     We are from time to time a party to various lawsuits, claims and other
legal proceedings that arise in the ordinary course of business. These actions
typically seek, among other things, compensation for alleged personal injury,
breach of contract, property damage, punitive damages, civil penalties or other
losses, or injunctive or declaratory relief. With respect to all such lawsuits,
claims and proceedings, we establish reserves when it is probable a liability
has been incurred and the amount of loss can be reasonably estimated. We do not
believe that any of these proceedings, separately or in the aggregate, would be
expected to have a material adverse effect on our results of operations or
financial position.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     (a) Exhibits.

<Table>
<Caption>
EXHIBIT
NUMBER                                  DESCRIPTION
-------                                 -----------
<C>       <C>   <S>
  3.1       --  Restated Certificate of Incorporation (previously filed as
                Exhibit 3.3 to Quanta's Form 10-Q (No. 001-13831) filed
                August 14, 2003 and incorporated herein by reference)
  3.2       --  Amended and Restated Bylaws (previously filed as Exhibit 3.2
                to Quanta's 2000 Form 10-K (No. 001-13831) filed April 2,
                2001 and incorporated herein by reference)
  4.1       --  Indenture regarding 4.5% Convertible Subordinated Debentures
                between Quanta Services, Inc. and Wells Fargo Bank, N.A.,
                Trustee, dated as of October 17, 2003 (filed herewith)
 10.1       --  4.5% Convertible Subordinated Debentures Resale Registration
                Rights Agreement dated October 17, 2003 (filed herewith)
 10.2       --  Fourth Amended and Restated Secured Credit Agreement (filed
                herewith)
 31.1       --  Certification of Periodic Report by Chief Executive Officer
                pursuant to Rule 13a-14(a)/15d-14(a) and pursuant to Section
                302 of the Sarbanes-Oxley Act of 2002 (filed herewith)
 31.2       --  Certification of Periodic Report by Chief Financial Officer
                pursuant to Rule 13a-14(a)/15d-14(a) and pursuant to Section
                302 of the Sarbanes-Oxley Act of 2002 (filed herewith)
 32.1       --  Certification of Periodic Report by Chief Executive Officer
                and Chief Financial Officer pursuant to 18 U.S.C. Section
                1350, as adopted pursuant to Section 906 of the
                Sarbanes-Oxley Act of 2002 (furnished herewith)
</Table>

     (b) Reports on Form 8-K

     (1) On August 6, 2003, Quanta furnished a Form 8-K announcing under Items 7
and 12 its press release reporting earnings for the second quarter of 2003.

                                        29
<PAGE>

                                   SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant, Quanta Services, Inc., has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                          QUANTA SERVICES, INC.

                                          By:     /s/ DERRICK A. JENSEN
                                            ------------------------------------
                                                     Derrick A. Jensen
                                               Vice President, Controller and
                                                  Chief Accounting Officer

Dated: November 13, 2003

                                        30
<PAGE>

                                 EXHIBIT INDEX

<Table>
<Caption>
EXHIBIT
NUMBER                                  DESCRIPTION
-------                                 -----------
<C>       <C>   <S>
  3.1       --  Restated Certificate of Incorporation (previously filed as
                Exhibit 3.3 to Quanta's Form 10-Q (No. 001-13831) filed
                August 14, 2003 and incorporated herein by reference)
  3.2       --  Amended and Restated Bylaws (previously filed as Exhibit 3.2
                to Quanta's 2000 Form 10-K (No. 001-13831) filed April 2,
                2001 and incorporated herein by reference)
  4.1       --  Indenture regarding 4.5% Convertible Subordinated Debentures
                between Quanta Services, Inc. and Wells Fargo Bank, N.A.,
                Trustee, dated as of October 17, 2003 (filed herewith)
 10.1       --  4.5% Convertible Subordinated Debentures Resale Registration
                Rights Agreement dated October 17, 2003 (filed herewith)
 10.2       --  Fourth Amended and Restated Secured Credit Agreement (filed
                herewith)
 31.1       --  Certification of Periodic Report by Chief Executive Officer
                pursuant to Rule 13a-14(a)/15d-14(a) and pursuant to Section
                302 of the Sarbanes-Oxley Act of 2002 (filed herewith)
 31.2       --  Certification of Periodic Report by Chief Financial Officer
                pursuant to Rule 13a-14(a)/15d-14(a) and pursuant to Section
                302 of the Sarbanes-Oxley Act of 2002 (filed herewith)
 32.1       --  Certification of Periodic Report by Chief Executive Officer
                and Chief Financial Officer pursuant to 18 U.S.C. Section
                1350, as adopted pursuant to Section 906 of the
                Sarbanes-Oxley Act of 2002 (furnished herewith)
</Table>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.1
<SEQUENCE>3
<FILENAME>h10560exv4w1.txt
<DESCRIPTION>INDENTURE RE 4.50% CONVERTIBLE DEBENTURES
<TEXT>
<PAGE>

                                                                     EXHIBIT 4.1

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

                              QUANTA SERVICES, INC.

                                       and

                             WELLS FARGO BANK, N.A.,
                                     Trustee

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

                                    INDENTURE

                                   Dated as of

                                October 17, 2003

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

               4.50% CONVERTIBLE SUBORDINATED DEBENTURES DUE 2023

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

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                    PAGE
                                                                                    ----
<S>                                                                                 <C>
                                    ARTICLE 1
                                   DEFINITIONS

Section 1.01. Definitions.......................................................      1

                                    ARTICLE 2
     ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF DEBENTURES

Section 2.01. Designation Amount and Issue of Debentures........................     13
Section 2.02. Form of Debentures................................................     13
Section 2.03. Date and Denomination of Debentures; Payments of Interest.........     14
Section 2.04. Execution of Debentures...........................................     15
Section 2.05. Exchange and Registration of Transfer of Debentures; Restrictions
                on Transfer.....................................................     16
Section 2.06. Mutilated, Destroyed, Lost or Stolen Debentures...................     22
Section 2.07. Temporary Debentures..............................................     23
Section 2.08. Cancellation of Debentures........................................     23
Section 2.09. CUSIP Numbers.....................................................     23

                                    ARTICLE 3
                     REDEMPTION AND REPURCHASE OF DEBENTURES

Section 3.01. Company's Right to Redeem.........................................     24
Section 3.02. Notice of Optional Redemption; Selection of Debentures............     24
Section 3.03. Payment of Debentures Called for Redemption by the Company........     25
Section 3.04. Conversion Arrangement on Call for Redemption.....................     26
Section 3.05. Repurchase of Debentures by the Company at Option of Holders upon
                a Fundamental Change............................................     27
Section 3.06. Repurchase of Debentures by the Company at Option of Holders on
                Specified Dates.................................................     29
Section 3.07. Company's Right to Elect Manner of Payment of Repurchase Price....     32
Section 3.08. Conditions and Procedures for Repurchase at Option of Holders.....     34

                                    ARTICLE 4
                           SUBORDINATION OF DEBENTURES

Section 4.01. Agreement to Subordinate..........................................     37
Section 4.02. Payment Over of Proceeds Upon Dissolution, Etc....................     37
Section 4.03. No Payment When Senior Indebtedness of the Company in Default.....     38
Section 4.04. Payment Permitted If No Default...................................     39
Section 4.05. Subrogation to Rights of Holders of Designated Senior
                Indebtedness of the Company.....................................     39
Section 4.06. Provisions Solely to Define Relative Rights.......................     40
Section 4.07. Trustee to Effectuate Subordination...............................     40
Section 4.08. No Waiver of Subordination Provisions.............................     40
Section 4.09. Notice to Trustee.................................................     41
</TABLE>

<PAGE>

<TABLE>
<S>                                                                                  <C>
Section 4.10. Reliance on Judicial Order or Certificate of Liquidating Agent....     41
Section 4.11. Trustee Not Fiduciary for Holders of Senior Indebtedness of the
                Company.........................................................     42
Section 4.12. Rights of Trustee as Holder of Senior Indebtedness of the
                Company; Preservation of Trustee's Rights.......................     42
Section 4.13. Article Applicable to Paying Agents...............................     42

                                    ARTICLE 5
                       PARTICULAR COVENANTS OF THE COMPANY

Section 5.01. Payment of Principal and Interest.................................     42
Section 5.02. Maintenance of Office or Agency...................................     42
Section 5.03. Appointments to Fill Vacancies in Trustee's Office................     43
Section 5.04. Provisions as to Paying Agent.....................................     43
Section 5.05. Existence.........................................................     44
Section 5.06. Rule 144A Information Requirement.................................     44
Section 5.07. Stay, Extension and Usury Laws....................................     45
Section 5.08. Compliance Certificate............................................     45
Section 5.09. Additional Amounts Notice.........................................     45

                                    ARTICLE 6
       DEBENTUREHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE

Section 6.01. Debentureholders' Lists...........................................     45
Section 6.02. Preservation and Disclosure of Lists..............................     46
Section 6.03. Reports by Trustee................................................     46
Section 6.04. Reports by the Company............................................     46

                                    ARTICLE 7
      REMEDIES OF THE TRUSTEE AND DEBENTUREHOLDERS ON AN EVENT OF DEFAULT

Section 7.01. Events of Default.................................................     47
Section 7.02. Payments of Debentures on Default; Suit Therefor..................     49
Section 7.03. Application of Monies Collected by Trustee........................     51
Section 7.04. Proceedings by Debentureholder....................................     51
Section 7.05. Proceedings by Trustee............................................     52
Section 7.06. Remedies Cumulative and Continuing................................     52
Section 7.07. Direction of Proceedings and Waiver of Defaults by Majority of
                Debentureholders................................................     52
Section 7.08. Notice of Defaults................................................     53
Section 7.09. Undertaking to Pay Costs..........................................     53

                                    ARTICLE 8
                                   THE TRUSTEE

Section 8.01. Duties and Responsibilities of Trustee............................     54
Section 8.02. Reliance on Documents, Opinions, Etc..............................     55
Section 8.03. No Responsibility for Recitals, Etc...............................     56
Section 8.04. Trustee, Paying Agents, Conversion Agents or Registrar May Own
                Debentures......................................................     57
</TABLE>

                                       ii

<PAGE>

<TABLE>
<S>                                                                                  <C>
Section 8.05. Monies to Be Held in Trust........................................     57
Section 8.06. Compensation and Expenses of Trustee..............................     57
Section 8.07. Officers' Certificate as Evidence.................................     58
Section 8.08. Conflicting Interests of Trustee..................................     58
Section 8.09. Eligibility of Trustee............................................     58
Section 8.10. Resignation or Removal of Trustee.................................     58
Section 8.11. Acceptance by Successor Trustee...................................     59
Section 8.12. Succession by Merger..............................................     60
Section 8.13. Preferential Collection of Claims.................................     60

                                    ARTICLE 9
                              THE DEBENTUREHOLDERS

Section 9.01. Action by Debentureholders........................................     60
Section 9.02. Proof of Execution by Debentureholders............................     61
Section 9.03. Who Are Deemed Absolute Owners....................................     61
Section 9.04. Company-owned Debentures Disregarded..............................     61
Section 9.05. Revocation of Consents, Future Holders Bound......................     62

                                   ARTICLE 10
                          MEETINGS OF DEBENTUREHOLDERS

Section 10.01. Purpose of Meetings..............................................     62
Section 10.02. Call of Meetings by Trustee......................................     62
Section 10.03. Call of Meetings by Company or Debentureholders..................     63
Section 10.04. Qualifications for Voting........................................     63
Section 10.05. Regulations......................................................     63
Section 10.06. Voting...........................................................     64
Section 10.07. No Delay of Rights by Meeting....................................     64

                                   ARTICLE 11
                             SUPPLEMENTAL INDENTURES

Section 11.01. Supplemental Indentures Without Consent of Debentureholders......     64
Section 11.02. Supplemental Indenture with Consent of Debentureholders..........     66
Section 11.03. Effect of Supplemental Indenture.................................     67
Section 11.04. Notation on Debentures...........................................     67
Section 11.05. Evidence of Compliance of Supplemental Indenture to Be Furnished
                to Trustee......................................................     68

                                   ARTICLE 12
                CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE

Section 12.01. Company May Consolidate on Certain Terms.........................     68
Section 12.02. Successor to Be Substituted......................................     68
Section 12.03. Opinion of Counsel to Be Given Trustee...........................     69
</TABLE>

                                      iii

<PAGE>

<TABLE>
<S>                                                                                  <C>
                                   ARTICLE 13
                     SATISFACTION AND DISCHARGE OF INDENTURE

Section 13.01. Discharge of Indenture...........................................     69
Section 13.02. Paying Agent to Repay Monies Held................................     70
Section 13.03. Return of Unclaimed Monies.......................................     70

                                   ARTICLE 14
        IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS

Section 14.01. Indenture and Debentures Solely Corporate Obligations............     70

                                   ARTICLE 15
                            CONVERSION OF DEBENTURES

Section 15.01. Right to Convert.................................................     70
Section 15.02. Exercise of Conversion Privilege; Issuance of Common Stock on
                Conversion; No Adjustment for Interest or Dividends; Settlement
                of Cash or Common Stock upon Conversion.........................     73
Section 15.03. Cash Payments in Lieu of Fractional Shares.......................     77
Section 15.04. Conversion Rate..................................................     77
Section 15.05. Adjustment of Conversion Rate....................................     77
Section 15.06. Effect of Reclassification, Consolidation, Merger or Sale........     83
Section 15.07. Taxes on Shares Issued...........................................     84
Section 15.08. Reservation of Shares, Shares to Be Fully Paid; Compliance with
                Governmental Requirements; Listing of Common Stock..............     84
Section 15.09. Responsibility of Trustee........................................     85
Section 15.10. Notice to Holders Prior to Certain Actions.......................     85
Section 15.11. Stockholder Rights Plans.........................................     86

                                   ARTICLE 16
                            MISCELLANEOUS PROVISIONS

Section 16.01. Confidentiality Exception........................................     86
Section 16.02. Provisions Binding on Company's Successors.......................     87
Section 16.03. Official Acts by Successor Corporation...........................     87
Section 16.04. Addresses for Notices, Etc.......................................     87
Section 16.05. Governing Law....................................................     87
Section 16.06. Evidence of Compliance with Conditions Precedent, Certificates
                to Trustee......................................................     87
Section 16.07. Legal Holidays...................................................     88
Section 16.08. Company Responsible for Making Calculations......................     88
Section 16.09. Trust Indenture Act..............................................     88
Section 16.10. No Security Interest Created.....................................     89
Section 16.11. Benefits of Indenture............................................     89
Section 16.12. Table of Contents, Headings, Etc.................................     89
Section 16.13. Authenticating Agent.............................................     89
Section 16.14. Execution in Counterparts........................................     90
Section 16.15. Severability.....................................................     90
</TABLE>

                                       iv

<PAGE>

Exhibit A         Form of Debenture                                          A-1

                                       v

<PAGE>

                                    INDENTURE

         INDENTURE dated as of October 17, 2003 between Quanta Services, Inc., a
Delaware corporation (hereinafter called the "Company"), having its principal
office at 1360 Post Oak Boulevard, Suite 2100, Houston, TX 77056, and Wells
Fargo Bank, N.A., a National banking association (hereinafter called the
"TRUSTEE").

                                   WITNESSETH:

         WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the issue of its 4.50% Convertible Subordinated Debentures due 2023
(hereinafter called the "DEBENTURES"), in an aggregate principal amount not to
exceed $270,000,000, and, to provide the terms and conditions upon which the
Debentures are to be authenticated, issued and delivered, the Company has duly
authorized the execution and delivery of this Indenture.

         WHEREAS, the Debentures, the certificate of authentication to be borne
by the Debentures, a form of assignment, a form of fundamental change repurchase
election, a form of Company repurchase election and a form of conversion notice
to be borne by the Debentures are to be substantially in the forms hereinafter
provided for.

         WHEREAS, all acts and things necessary to make the Debentures, when
executed by the Company and authenticated and delivered by the Trustee or a duly
authorized authenticating agent, as in this Indenture provided, the valid,
binding and legal obligations of the Company, and to constitute this Indenture a
valid agreement according to its terms, have been done and performed, and the
execution of this Indenture and the issue hereunder of the Debentures have in
all respects been duly authorized. In addition, all things necessary to duly
authorize the issuance of the Common Stock of the Company initially issuable
upon the conversion of the Debentures, and to duly reserve for issuance the
number of shares of Common Stock initially issuable upon such conversion have
been done.

         NOW, THEREFORE, THIS INDENTURE WITNESSETH:

         That in order to declare the terms and conditions upon which the
Debentures are, and are to be, authenticated, issued and delivered, and in
consideration of the premises and of the purchase and acceptance of the
Debentures by the holders thereof, the Company covenants and agrees with the
Trustee for the equal and proportionate benefit of the respective holders from
time to time of the Debentures (except as otherwise provided below), as follows:

                                   ARTICLE 1
                                   DEFINITIONS

Section 1.01. Definitions. The terms defined in this Section 1.01 (except as
herein otherwise expressly provided or unless the context otherwise requires)
for all purposes of this Indenture and of any indenture supplemental hereto
shall have the respective meanings specified in this Section 1.01. All other
terms used in this Indenture that are defined in the Trust Indenture Act or
which are by reference therein defined in the Securities Act (except as herein
otherwise expressly provided or unless the context otherwise requires) shall
have the meanings assigned to such terms in the Trust Indenture Act and in the
Securities Act as in force at the date of the

<PAGE>

execution of this Indenture. The words "HEREIN", "HEREOF", "HEREUNDER" and words
of similar  import refer to this  Indenture as a whole and not to any particular
Article, Section or other Subdivision. The terms defined in this Article include
the plural as well as the singular.

         "ADDITIONAL AMOUNTS" has the meaning specified for "Liquidated Damages"
in Section 3(a) of the Registration Rights Agreement.

         "ADDITIONAL AMOUNTS NOTICE" has the meaning specified in Section 5.09.

         "ADJUSTMENT EVENT" has the meaning specified in Section 15.05(m).

         "AGENT MEMBERS" has the meaning specified in Section 2.05(b)(v).

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

         "BANKRUPTCY LAW" means Title 11, United States Bankruptcy Code of 1978,
as amended, or any similar United States federal or state law relating to the
bankruptcy, insolvency, receivership, winding-up, liquidation, reorganization or
relief of debtors or any amendment to, succession to or change in any such law.

         "BOARD OF DIRECTORS" means the Board of Directors of the Company or a
committee of such Board duly authorized to act for it hereunder.

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

         "BUSINESS DAY" means any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which commercial banks are authorized or
required by law, regulation or executive order to close in The City of New York.

         "CAPITAL STOCK" of any Person means any and all shares (including
ordinary shares underlying any American Depositary Shares), interests,
participations or other equivalents however designated of corporate stock or
other equity participations, including partnership interests, whether general or
limited, of such Person and any rights (other than debt securities convertible
or exchangeable into an equity interest), warrants or options to acquire an
equity interest in such Person.

         "CASH" has the meaning specified in Section 3.07(a).

         "CASH AMOUNT" has the meaning specified in Section 15.02(h).

                                       2

<PAGE>

         "CASH SETTLEMENT AVERAGING PERIOD" has the meaning specified in Section
15.02(g)(i).

         "CASH SETTLEMENT NOTICE PERIOD" has the meaning specified in
15.02(g)(i).

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

         "COMMON STOCK" means any stock of any class of the Company which has no
preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the Company
and which is not subject to redemption by the Company, and includes the rights
evidenced by such stock to the extent provided in the Rights Agreement dated
March 8, 2000 (and as amended prior to the date hereof) between the Company and
American Stock Transfer & Trust Company. Subject to the provisions of Section
15.06, however, shares issuable on conversion of Debentures shall include only
shares of the class designated as common stock of the Company at the date of
this Indenture (namely, the Common Stock, par value $.00001) or shares of any
class or classes resulting from any reclassification or reclassifications
thereof and which have no preference in respect of dividends or of amounts
payable in the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company and which are not subject to redemption by the
Company; provided that if at any time there shall be more than one such
resulting class, the shares of each such class then so issuable on conversion
shall be substantially in the proportion which the total number of shares of
such class resulting from all such reclassifications bears to the total number
of shares of all such classes resulting from all such reclassifications.

         "COMPANY" means the corporation named as the "Company" in the first
paragraph of this Indenture, and, subject to the provisions of Article 12 and
Section 15.06, shall include its successors and assigns.

         "COMPANY REPURCHASE DATE" has the meaning specified in Section 3.06(a).

         "COMPANY REPURCHASE ELECTION" has the meaning specified in Section
3.06(c)(i).

         "COMPANY REPURCHASE NOTICE" has the meaning specified in Section
3.06(b).

         "COMPANY REPURCHASE PRICE" has the meaning specified in Section
3.06(a).

         "CONVERSION AGENT" means the Trustee or such other office or agency
designated by the Company where Debentures may be presented for conversion.

         "CONVERSION DATE" has the meaning specified in Section 15.02.

         "CONVERSION OBLIGATION" has the meaning specified in Section
15.02(g)(i).

         "CONVERSION PRICE" as of any day means $1,000 divided by the Conversion
Rate as of such date and rounded to the nearest cent. The Conversion Price shall
initially be $11.14 per share of Common Stock.

                                       3

<PAGE>

         "CONVERSION RATE" has the meaning specified in Section 15.04.

         "CONVERSION RETRACTION PERIOD" has the meaning specified in Section
15.02(g)(i).

         "CORPORATE TRUST OFFICE" or other similar term means the designated
office of the Trustee at which at any particular time its corporate trust
business as it relates to this Indenture shall be administered, which office is,
at the date as of which this Indenture is dated, located at 505 Main Street,
Suite 301, Forth Worth, Texas 76102.

         "CURRENT MARKET PRICE" per share of Common Stock means, with respect to
any date of determination, the average of the Last Reported Sale Price of the
Common Stock for the ten (10) consecutive Trading Days ending not later than the
earlier of the date of determination and the day before the Ex-Dividend Date
with respect to the issuance or distribution requiring such computation. If
another issuance or distribution to which Section 15.05 applies occurs during
the period applicable for calculating "CURRENT MARKET PRICE" pursuant to this
definition, "CURRENT MARKET PRICE" shall be calculated for such period in a
manner determined by the Board of Directors to reflect the impact of such
issuance, distribution, subdivision or combination on the Last Reported Sale
Price of the Common Stock during such period.

         "CUSTODIAN" means Wells Fargo Bank, N.A., a National banking
association, as custodian with respect to the Debentures in global form, or any
successor entity thereto.

         "DEBENTURE" or "DEBENTURES" means any Debenture or Debentures, as the
case may be, authenticated and delivered under this Indenture, including any
Global Debenture.

         "DEBENTURE REGISTER" has the meaning specified in Section 2.05.

         "DEBENTURE REGISTRAR" has the meaning specified in Section 2.05.

         "DEBENTUREHOLDER" or "HOLDER" as applied to any Debenture, or other
similar terms (but excluding the term "BENEFICIAL holder"), means any Person in
whose name a particular Debenture is registered at the time on the Debenture
Registrar's books.

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

         "DEFAULTED INTEREST" has the meaning specified in Section 2.03.

         "DEPOSITARY" means the clearing agency registered under the Exchange
Act that is designated to act as the Depositary for the Global Debentures. The
Depository Trust Company shall be the initial Depositary, until a successor
shall have been appointed and become such pursuant to the applicable provisions
of this Indenture, and thereafter, "Depositary" shall mean or include such
successor.

         "DESIGNATED SENIOR INDEBTEDNESS" means senior indebtedness under the
Senior Credit Agreement and the Senior Secured Note Agreement and the Company's
obligations under any other particular senior indebtedness that expressly
provides that such senior indebtedness shall be "Designated Senior Indebtedness"
of the Company for the purposes of this Indenture.

                                       4

<PAGE>

         "DETERMINATION DATE" has the meaning specified in Section 15.05(m).

         "EVENT OF DEFAULT" has the meaning specified in Section 7.01.

         "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder, as in effect from time to
time.

         "EX-DIVIDEND DATE" means, with respect to any issuance or distribution
on shares of Common Stock, the first date on which the shares of Common Stock
trade regular way on the principal securities market on which the shares of
Common Stock are then traded without the right to receive such issuance or
distribution.

         "EXPIRATION TIME" has the meaning specified in Section 15.05(f).

         "FAIR MARKET VALUE" means, with respect to any asset or property, the
sale value that would be obtained in an arm's-length transaction between an
informed and willing seller under no compulsion to sell and an informed and
willing buyer under no compulsion to buy. Unless otherwise indicated, Fair
Market Value shall be determined in good faith by the Board of Directors.

         "FINAL NOTICE DATE" has the meaning specified in Section 15.02(g).

         "FORM OF CONVERSION NOTICE" has the meaning specified in Section
15.02(a).

         "FUNDAMENTAL CHANGE" means the occurrence of any of the following:

                  (i)      a "person" or "group", within the meaning of Section
         13(d) of the Exchange Act other than the Company, its subsidiaries or
         its or their employee benefit plans, files a Schedule TO or any other
         schedule, form or report under the Exchange Act disclosing that such
         person or group has become the direct or indirect ultimate "beneficial
         owner", as defined in Rule 13d-3 under the Exchange Act, of more than
         50% of the total voting power of all shares of the Company's capital
         stock that are entitled to vote generally in the election of directors;
         or

                  (ii)     consummation of any share exchange, consolidation or
         merger of the Company or any sale, lease or other transfer in one
         transaction or a series of transactions of all or substantially all of
         the consolidated assets of the Company and its subsidiaries, taken as a
         whole, to any person other than the Company or one or more of its
         subsidiaries, pursuant to which the Common Stock will be converted into
         cash, securities or other property; provided, however, that a
         transaction where the holders of the Company's voting capital stock
         immediately prior to such transaction have, directly or indirectly,
         more than 50% of the aggregate voting power of all shares of capital
         stock of the continuing or surviving corporation or transferee entitled
         to vote generally in the election of directors immediately after such
         event shall not be a Fundamental Change.

                                       5

<PAGE>

         A Fundamental Change will not be deemed to have occurred in respect of
either of the foregoing, however, if either:

                  (i)      the Last Reported Sale Price of the Common Stock for
         any five (5) Trading Days within the ten (10) consecutive Trading Days
         ending immediately before the later of the Fundamental Change or the
         public announcement thereof equals or exceeds 105% of the Conversion
         Price of the Debentures immediately before the Fundamental Change or
         the public announcement thereof, or

                  (ii)     at least 90% of the consideration, excluding cash
         payments for fractional shares, in the transaction or transactions
         constituting the Fundamental Change consists of shares of capital stock
         traded on a national securities exchange or quoted on the Nasdaq
         National Market or which will be so traded or quoted when issued or
         exchanged in connection with a Fundamental Change (these securities
         being referred to as "PUBLICLY TRADED SECURITIES") and as a result of
         this transaction or transactions the Debentures become convertible into
         such publicly traded securities, excluding cash payments for fractional
         shares.

         "FUNDAMENTAL CHANGE REPURCHASE DATE" has the meaning specified in
Section 3.05(a).

         "FUNDAMENTAL CHANGE REPURCHASE ELECTION" has the meaning specified in
Section 3.05(c)(i).

         "FUNDAMENTAL CHANGE REPURCHASE NOTICE" has the meaning specified in
Section 3.05(b).

         "FUNDAMENTAL CHANGE REPURCHASE PRICE" has the meaning provided in
Section 3.05(a).

         "GLOBAL DEBENTURE" has the meaning specified in Section 2.02.

         "GUARANTEE" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of
Indebtedness.

         "INDEBTEDNESS" means, with respect to any Person, without duplication:

                  (1)      all indebtedness, obligations and other liabilities
         of such Person for borrowed money, including commitment or standby
         fees, enforcement expenses, collateral protection expenses and other
         reimbursement indemnity obligations with respect to such indebtedness,
         overdrafts, foreign exchange contracts, currency exchange agreements,
         interest rate protection agreements, and any loans or advances from
         banks, or evidenced by bonds, debentures, notes or similar instruments,
         other than any account payable or other accrued current liability or
         obligation of such Person incurred in the ordinary course of business
         in connection with the obtaining of materials or services;

                                       6

<PAGE>

                  (2)      obligations of such Person with respect to letters of
         credit, bank guarantees or bankers' acceptances;

                  (3)      obligations of such Person in respect of leases
         required in conformity with generally accepted accounting principles to
         be accounted for as capitalized lease obligations;

                  (4)      all obligations and other liabilities of such Person
         under any lease or related document in connection with the lease of
         real property that provides that such Person is contractually obligated
         to purchase or cause a third party to purchase the leased property and
         thereby guarantee a minimum residual value of the leased property to
         the lessor and such Person's obligations under the lease or related
         document to purchase or to cause a third party to purchase the leased
         property;

                  (5)      all obligations of such Person with respect to an
         interest rate or other swap, cap or collar agreement or foreign
         currency hedge, exchange or purchase agreement;

                  (6)      all direct or indirect guarantees or similar
         agreements in respect of such Person's obligations or liabilities to
         purchase, acquire or otherwise assure a creditor against loss in
         respect of, indebtedness, obligations or liabilities of others of the
         type described in paragraphs (1) through (5) above;

                  (7)      any obligations of such Person described in
         paragraphs (1) to (5) above secured by any mortgage, pledge, lien or
         other encumbrance existing on property which is owned or held by such
         Person; and

                  (8)      any renewals, extensions, refundings, refinancings,
         restructurings, amendments or modifications to paragraphs (1) through
         (7) above.

         "INDENTURE" means this instrument as originally executed or, if amended
or supplemented as herein provided, as so amended or supplemented.

         "INITIAL PURCHASERS" means Banc of America Securities LLC and J.P.
Morgan Securities Inc.

         "INTEREST" means, when used with respect to the Debentures, any
interest payable under the terms of the Debentures and Additional Amounts, if
any, payable under the terms of the Registration Rights Agreement.

         "INTEREST PAYMENT DATE" means April 1 and October 1 of each year,
commencing April 1, 2004.

          "LAST REPORTED SALE PRICE" of the Common Stock on any date means the
closing sale price per share (or if no closing sale price is reported, the
average of the bid and asked prices or, if more than one in either case, the
average of the average bid and the average asked prices) on that date as
reported in composite transactions for the principal United States securities
exchange on which the Common Stock is traded or, if the Common Stock is not
listed on a United States

                                       7

<PAGE>

national or regional securities exchange, as reported by the Nasdaq National
Market. If the Common Stock is not listed for trading on a U.S. national or
regional securities exchange on the relevant date, the "LAST REPORTED SALE
PRICE" will be the last quoted bid price for the Common Stock in the
over-the-counter market on the relevant date as reported by the National
Quotation Bureau Incorporated or similar organization. If the Common Stock is
not so quoted, the "LAST REPORTED SALE PRICE" will be the average of the
mid-point of the last bid and asked prices for the Common Stock on the relevant
date quoted by each of at least three independent nationally recognized
investment banking firms selected by the Company for this purpose.

         "LIEN" means, with respect to any asset, mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset
given to secure Indebtedness, whether or not filed, recorded or otherwise
perfected under applicable law (including any conditional sale or other title
retention agreement, any lease in the nature thereof, any option or other
agreement to sell or give a security interest in and any filing of or agreement
to give any financing statement under the Uniform Commercial Code (or equivalent
statutes) of any jurisdiction with respect to any such lien, pledge, charge or
security interest).

         "MARKET PRICE" means, with respect to any Repurchase Date or other date
of determination, the average of the Last Reported Sale Price of the Common
Stock for the twenty (20) consecutive Trading Days ending on the third Business
Day prior to the applicable Repurchase Date or date of determination, as the
case may be (or, if such third Business Day prior to the applicable Repurchase
Date or date of determination, as the case may be, is not a Trading Day, then
ending on the last Trading Day prior to such third Business Day), appropriately
adjusted to take into account the occurrence, during the period commencing on
the first Trading Day during the period of twenty (20) consecutive Trading Days
and ending on the applicable Repurchase Date or date of determination, as the
case may be, of any event described in Section 15.05 or Section 15.06.

         "NON-ELECTING SHARE" has the meaning specified in Section 15.06.

         "OFFICERS' CERTIFICATE", when used with respect to the Company, means a
certificate signed by any two of the Chairman of the Board, the Chief Executive
Officer, the Chief Operating Officer, the President, the Chief Financial
Officer, any Vice President (whether or not designated by a number or numbers or
word or words added before or after the title "Vice President"), the Treasurer
or the Secretary of the Company.

         "OPINION OF COUNSEL" means an opinion in writing signed by legal
counsel, who may be an employee of or counsel to the Company, or other counsel
reasonably acceptable to the Trustee.

         "ORIGINAL ISSUANCE DATE" means the date on which the Debentures are
first authenticated and delivered under this Indenture.

                                       8

<PAGE>

         "OUTSTANDING", when used with reference to Debentures and subject to
the provisions of Section 9.04, means, as of any particular time, all Debentures
authenticated and delivered by the Trustee under this Indenture, except:

                  (a)      Debentures theretofore canceled by the Trustee or
         delivered to the Trustee for cancellation;

                  (b)      Debentures, or portions thereof, (i) for the
         redemption of which monies in the necessary amount shall have been
         deposited in trust with the Trustee or with any Paying Agent (other
         than the Company) or (ii) which shall have been otherwise discharged in
         accordance with Article 13;

                  (c)      Debentures in lieu of which, or in substitution for
         which, other Debentures shall have been authenticated and delivered
         pursuant to the terms of Section 2.06; and

                  (d)      Debentures converted into Common Stock pursuant to
         Article 15 and Debentures deemed not outstanding pursuant to Article 3.

         "PAYING AGENT" means the Trustee or such other office or agency
designated by the Company where Debentures may be presented for payment.

         "PAYMENT BLOCKAGE PERIOD" has the meaning specified in Section 4.03.

         "PAYMENT DEFAULT" has the meaning specified in Section 4.03.

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

         "PORTAL MARKET" means The PORTAL Market operated by the National
Association of Securities Dealers, Inc. or any successor thereto.

         "PREDECESSOR DEBENTURE" of any particular Debenture means every
previous Debenture evidencing all or a portion of the same debt as that
evidenced by such particular Debenture, and, for the purposes of this
definition, any Debenture authenticated and delivered under Section 2.06 in lieu
of a lost, destroyed or stolen Debenture shall be deemed to evidence the same
debt as the lost, destroyed or stolen Debenture that it replaces.

         "PRINCIPAL VALUE CONVERSION" has the meaning specified in Section
15.01(b).

         "PROCEEDING" has the meaning specified in Section 4.02.

         "PURCHASED SHARES" has the meaning specified in Section 15.05(f).

         "REDEMPTION DATE" has the meaning specified in Section 3.02(a).

         "REDEMPTION NOTICE" has the meaning specified in Section 3.02(a).

         "REDEMPTION PRICE" has the meaning specified in Section 3.01.

                                       9

<PAGE>

         "REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement, dated as of October 17, 2003, between the Company and the Initial
Purchasers, as amended from time to time in accordance with its terms.

         "REGULAR RECORD DATE" means, with respect to each Interest Payment
Date, the close of business on the March 15 or September 15 preceding such
Interest Payment Date (whether or not a Business Day).

         "REPURCHASE DATE" means the Fundamental Change Repurchase Date or the
Company Repurchase Date, as the context requires.

         "REPURCHASE ELECTION" means the Fundamental Change Repurchase Election
or the Company Repurchase Election, as the context requires.

         "REPURCHASE NOTICE" means the Fundamental Change Repurchase Notice or
the Company Repurchase Notice, as the context requires.

         "REPURCHASE PRICE" means the Fundamental Change Repurchase Price or the
Company Repurchase Price, as the context requires.

         "RESPONSIBLE OFFICER" means, when used with respect to the Trustee, any
officer within the corporate trust department of the Trustee with direct
responsibility for the administration of this Indenture and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of such person's knowledge of or any familiarity with
the particular subject.

         "RESTRICTED SECURITIES" has the meaning specified in Section 2.05(c).

         "RULE 144A" means Rule 144A as promulgated under the Securities Act.

         "SECURITIES ACT" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder, as in effect from time to time.

         "SECURITIES PAYMENT" has the meaning specified in Section 4.02.

         "SENIOR CREDIT AGREEMENT" means the Third Amended and Restated Secured
Credit Agreement, dated as of June 14, 1999, among the Company, the lenders
named therein and Bank of America, N.A., as administrative agent, including any
debentures, guarantees, collateral documents, instruments and agreements
executed in connection therewith, and in each case as

                                       10

<PAGE>

amended (including any amendment and restatement thereof), modified, extended,
renewed, refunded, substituted or replaced or refinanced from time to time,
including any agreement extending the maturity of, refinancing, replacing or
otherwise restructuring (including increasing the amount of available borrowings
thereunder or adding subsidiaries of the Company as additional borrowers or
guarantors thereunder), all or any portion of the Indebtedness under such
agreement or any successor or replacement agreement and whether by the same or
any other agents, creditor, lender or group of creditors or lenders.

         "SENIOR INDEBTEDNESS" means the principal, premium, if any, interest,
including any interest accruing after bankruptcy, and rent or termination
payments on or other amounts due on the Company's current or future
Indebtedness, whether created, incurred, assumed, guaranteed or in effect
guaranteed by the Company, but only to the extent that the same is not treated
as "unsecured indebtedness" for purposes of section 279 of the Internal Revenue
Code. For the avoidance of doubt, all amounts owing by the Company under the
Senior Credit Agreement and the Senior Secured Note Agreement constitute "SENIOR
INDEBTEDNESS".

         Notwithstanding the foregoing, "SENIOR INDEBTEDNESS" shall not include:

         (a)      Indebtedness that expressly provides that it shall not be
                  senior in right of payment to the Debentures or expressly
                  provides that it is on the same basis or junior to the
                  Debentures;

         (b)      Indebtedness of the Company to any of its Subsidiaries; and

         (c)      the Debentures.

         "SENIOR NONMONETARY DEFAULT" has the meaning specified in Section
4.03.

         "SENIOR SECURED NOTE AGREEMENT" means the Note Purchase Agreement,
dated as of March 1, 2000, among the Company and the lenders named therein,
including any notes, guarantees, collateral documents, instruments and
agreements executed in connection therewith, and in each case as amended
(including any amendment and restatement thereof), modified, extended, renewed,
refunded, substituted or replaced or refinanced from time to time, including any
agreement extending the maturity of, refinancing, replacing or otherwise
restructuring (including increasing the amount of available borrowings
thereunder or adding subsidiaries of the Company as additional borrowers or
guarantors thereunder) all or any portion of the Indebtedness under such
agreement or any successor or replacement agreement and whether by the same or
any other agents, creditor, lender or group of creditors or lenders.

         "SPECIAL RECORD DATE" has the meaning specified in Section 2.03.

         "SPIN-OFF MARKET PRICE" per share of Common Stock of the Company or the
capital stock of, or similar equity interests in, a subsidiary or other business
unit of the Company on any day means the average of the daily Last Reported Sale
Price of the Common Stock or such capital stock or similar equity interests for
the twenty (20) consecutive Trading Days commencing on and including the fifth
Trading Day after the Ex-Dividend Date with respect to the issuance or
distribution requiring such computation.

                                       11

<PAGE>

         "STATED MATURITY" means October 1, 2023.

         "STOCK RECORD DATE" means, with respect to any dividend, distribution
or other transaction or event in which the holders of Common Stock have the
right to receive any cash, securities or other property or in which the Common
Stock (or other applicable security) is exchanged for or converted into any
combination of cash, securities or other property, the date fixed for
determination of stockholders entitled to receive such cash, securities or other
property (whether such date is fixed by the Board of Directors or by statute,
contract or otherwise).

         "SUBSIDIARY" means, with respect to any Person, (a) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of capital stock or other equity interest entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other subsidiaries
of that Person (or a combination thereof) and (b) any partnership (i) the sole
general partner or managing general partner of which is such Person or a
subsidiary of such Person or (ii) the only general partners of which are such
Person or of one or more subsidiaries of such Person (or any combination
thereof).

         "TRADING DAY" means a day during which trading in securities generally
occurs on the New York Stock Exchange or, if the applicable security is not
listed on the New York Stock Exchange, on the principal other national or
regional securities exchange on which the applicable security is then listed or,
if the applicable security is not listed on a national or regional securities
exchange, on the National Association of Securities Dealers Automated Quotation
System or, if the applicable security is not quoted on the National Association
of Securities Dealers Automated Quotation System, on the principal other market
on which the applicable security is then traded (provided that no day on which
trading of the applicable security is suspended on such exchange or other
trading market will count as a trading day).

         "TRADING PRICE" means, as of any date of determination, the average of
the secondary market bid quotations obtained by the Trustee for $5,000,000
principal amount of Debentures at approximately 3:30 p.m., New York City time,
on such determination date from three independent nationally recognized
securities dealers (none of which shall be an Affiliate of the Company) in The
City of New York (or such other place that may be determined from time to time
by the Company) selected by the Company; provided, however, if at least three
such bids cannot reasonably be obtained by the Trustee, but two such bids are
obtained, then the average of the two bids shall be used, and if only one such
bid can reasonably be obtained by the Trustee, that one bid shall be used. If
the Trustee cannot reasonably obtain at least one bid for $5,000,000 principal
amount of Debentures from an independent nationally recognized securities dealer
or in the reasonable judgment of the Company, the bid quotations are not
indicative of the secondary market value of the Debentures, then the Trading
Price per $1,000 principal amount of Debentures will be deemed to be less than
98% of the product of the Last Reported Sale Price of the Common Stock and the
Conversion Rate.

         "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as
amended, as it was in force at the date of this Indenture, except as provided in
Sections 11.03 and 15.06; provided that if the Trust Indenture Act of 1939 is
amended after the date hereof, the term "TRUST INDENTURE

                                       12

<PAGE>

ACT" shall mean, to the extent required by such amendment, the Trust Indenture
Act of 1939 as so amended.

         "TRUSTEE" means Wells Fargo Bank, N.A., a National banking association,
and its successors and any corporation resulting from or surviving any
consolidation or merger to which it or its successors may be a party and any
successor trustee at the time serving as successor trustee hereunder.

                                   ARTICLE 2
     ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF DEBENTURES

         Section 2.01. Designation Amount and Issue of Debentures. The
Debentures shall be designated as "4.50% CONVERTIBLE SUBORDINATED DEBENTURES DUE
2023". Debentures not to exceed the aggregate principal amount of $225,000,000
(up to $270,000,000 if the Initial Purchasers exercise their option pursuant to
the Purchase Agreement dated October 9, 2003 between the Company and the Initial
Purchasers) (except pursuant to Sections 2.05, 2.06, 3.05, 3.06 and 15.02
hereof) upon the execution of this Indenture, or from time to time thereafter,
may be executed by the Company and delivered to the Trustee for authentication,
and the Trustee shall thereupon authenticate and deliver said Debentures to or
upon the written order of the Company, signed by its Chairman of the Board, its
Chief Executive Officer, its Chief Operating Officer, its President, its Chief
Financial Officer, any Vice President (whether or not designated by a number or
numbers or word or words added before or after the title "Vice President"), its
Treasurer, its Secretary or any Assistant Secretary.

         Section 2.02. Form of Debentures. The Debentures and the Trustee's
certificate of authentication to be borne by such Debentures shall be
substantially in the form set forth in Exhibit A. The terms and provisions
contained in the form of Debenture attached as Exhibit A hereto shall
constitute, and are hereby expressly made, a part of this Indenture and, to the
extent applicable, the Company and the Trustee, by their execution and delivery
of this Indenture, expressly agree to such terms and provisions and to be bound
thereby.

         Any of the Debentures may have such letters, numbers of other marks of
identification and such notations, legends, endorsements or changes as the
officers executing the same may approve (execution thereof to be conclusive
evidence of such approval) and as are not inconsistent with the provisions of
this Indenture, or as may be required by the Custodian, the Depositary or by
National Association of Securities Dealers, Inc. in order for the Debentures to
be tradable on the PORTAL Market or as may be required for the Debentures to be
tradable on any other market developed for trading of securities pursuant to
Rule 144A or as may be required to comply with any applicable law or with any
rule or regulation made pursuant thereto or with any rule or regulation of any
securities exchange or automated quotation system on which the Debentures may be
listed, or to conform to usage, or to indicate any special limitations or
restrictions to which any particular Debentures are subject.

         So long as the Debentures are eligible for book-entry settlement with
the Depositary, or unless otherwise required by law, or otherwise contemplated
by Section 2.05(a), all of the Debentures will be represented by one or more
Debentures in global form registered in the name of the Depositary or the
nominee of the Depositary (a "GLOBAL DEBENTURE"). The transfer and

                                       13

<PAGE>

exchange of beneficial interests in any such Global Debenture shall be effected
through the Depositary in accordance with this Indenture and the applicable
procedures of the Depositary. Except as provided in Section 2.05(a), beneficial
holders of a Global Debenture shall not be entitled to have certificates
registered in their names, will not receive or be entitled to receive physical
delivery of certificates in definitive form and will not be considered holders
of such Global Debenture.

         Any Global Debenture shall represent such of the outstanding Debentures
as shall be specified therein and shall provide that it shall represent the
aggregate amount of outstanding Debentures from time to time endorsed thereon
and that the aggregate amount of outstanding Debentures represented thereby may
from time to time be increased or reduced to reflect redemptions, repurchases,
conversions, transfers or exchanges permitted hereby. Any endorsement of a
Global Debenture to reflect the amount of any increase or decrease in the amount
of outstanding Debentures represented thereby shall be made by the Trustee or
the Custodian, at the direction of the Trustee, in such manner and upon
instructions given by the holder of such Debentures in accordance with this
Indenture. Payment of principal of and interest on any Global Debenture shall be
made to the holder of such Debenture.

         Section 2.03. Date and Denomination of Debentures; Payments of
Interest. The Debentures shall be issuable in registered form without coupons in
denominations of $1,000 principal amount and integral multiples thereof. Each
Debenture shall be dated the date of its authentication and shall bear interest
from the date specified on the face of the form of Debenture attached as Exhibit
A hereto. Interest on the Debentures shall be computed on the basis of a 360-day
year comprised of twelve 30-day months.

         The Person in whose name any Debenture (or its Predecessor Debenture)
is registered on the Debenture Register at the close of business on the Regular
Record Date with respect to an Interest Payment Date shall be entitled to
receive the interest payable on such Interest Payment Date, except that the
interest payable upon redemption or repurchase will be payable to the Person to
whom principal is payable pursuant to such redemption or repurchase (unless the
Redemption Date or the Repurchase Date, as the case may be, is an Interest
Payment Date, in which case the semiannual payment of interest becoming due on
such date shall be payable to the holders of such Debentures registered as such
on the applicable Regular Record Date). Notwithstanding the foregoing, if any
Debenture (or portion thereof) is converted into Common Stock during the period
after a Regular Record Date to, but excluding, the next succeeding Interest
Payment Date and such Debenture (or portion thereof) has been called or tendered
for redemption on a Redemption Date which occurs during such period, the Company
shall not be required to pay interest on such Interest Payment Date in respect
of any such Debenture (or portion thereof), except as provided in Section 15.02.
Interest shall be payable at the office of the Company maintained by the Company
for such purposes in the Borough of Manhattan, City of New York, which shall
initially be an office or agency of the Trustee. The Company shall pay interest
(i) on any Debentures in certificated form by check mailed to the address of the
Person entitled thereto as it appears in the Debenture Register (or upon written
notice, by wire transfer in immediately available funds, if such Person is
entitled to interest on Debentures with an aggregate principal amount in excess
of $2,000,000) or (ii) on any Global Debenture by wire transfer of immediately
available funds to the account of the Depositary or its nominee.

                                       14

<PAGE>

         Any interest on any Debenture which is payable, but is not punctually
paid or duly provided for, on any October 1 or April 1 (herein called "DEFAULTED
INTEREST") shall forthwith cease to be payable to the Debentureholder on the
relevant Regular Record Date by virtue of his having been such Debentureholder,
and such Defaulted Interest shall be paid by the Company, at its election in
each case, as provided in clause (1) or (2) below:

                  (1)      The Company may elect to make payment of any
         Defaulted Interest to the Persons in whose names the Debentures (or
         their respective Predecessor Debentures) are registered at the close of
         business on a "SPECIAL RECORD DATE" for the payment of such Defaulted
         Interest, which shall be the date 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 Debenture and the date of the
         proposed payment (which shall be not less than twenty-five (25) days
         after the receipt by the Trustee of such notice, unless the Trustee
         shall consent to an earlier date), and at the same time the Company
         shall deposit with the Trustee an amount of money equal to the
         aggregate amount to be paid in respect of such Defaulted Interest or
         shall make arrangements satisfactory to the Trustee for such deposit on
         or prior to the date of the proposed payment, such money when deposited
         on or prior to the date of the proposed payment to be held in trust for
         the benefit of the Persons entitled to such Defaulted Interest as in
         this clause provided. Thereupon the Trustee shall fix a Special Record
         Date for the payment of such Defaulted Interest which shall be not more
         than fifteen (15) days and not less than ten (10) days prior to the
         date of the proposed payment, and not less than ten (10) days after the
         receipt by the Trustee of the notice of the proposed payment. The
         Trustee shall promptly notify the Company of such Special Record Date
         and, in the name and at the expense of the Company, shall cause notice
         of the proposed payment of such Defaulted Interest and the Special
         Record Date therefor to be mailed, first-class postage prepaid, to each
         holder at his address as it appears in the Debenture Register, not less
         than ten (10) days prior to such Special Record Date. Notice of the
         proposed payment of such Defaulted Interest and the Special Record Date
         therefor having been so mailed, such Defaulted Interest shall be paid
         to the Persons in whose names the Debentures (or their respective
         Predecessor Debentures) are registered at the close of business on such
         Special Record Date and shall no longer be payable pursuant to the
         following clause (2) of this Section 2.03.

                  (2)      The Company may make payment of any Defaulted
         Interest in any other lawful manner not inconsistent with the
         requirements of any securities exchange or automated quotation system
         on which the Debentures may be listed or designated for issuance, and
         upon such notice as may be required by such exchange or automated
         quotation system, 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.

         Section 2.04. Execution of Debentures. The Debentures shall be signed
in the name and on behalf of the Company by the manual or facsimile signature of
its President, any Vice President (whether or not designated by a number or
numbers or word or words added before or after the title "Vice President"), its
Treasurer, its Secretary or any Assistant Secretary. Only such Debentures as
shall bear thereon a certificate of authentication substantially in the form set
forth on the form of Debenture attached as Exhibit A hereto, manually executed
by the Trustee (or an

                                       15

<PAGE>

authenticating agent appointed by the Trustee as provided by Section 16.13),
shall be entitled to the benefits of this Indenture or be valid or obligatory
for any purpose. Such certificate by the Trustee (or such an authenticating
agent) upon any Debenture executed by the Company shall be conclusive evidence
that the Debenture so authenticated has been duly authenticated and delivered
hereunder and that the holder is entitled to the benefits of this Indenture.

         In case any officer of the Company who shall have signed any of the
Debentures shall cease to be such officer before the Debentures so signed shall
have been authenticated and delivered by the Trustee, or disposed of by the
Company, such Debentures nevertheless may be authenticated and delivered or
disposed of as though the person who signed such Debentures had not ceased to be
such officer of the Company, and any Debenture may be signed on behalf of the
Company by such persons as, at the actual date of the execution of such
Debenture, shall be the proper officers of the Company, although at the date of
the execution of this Indenture any such person was not such an officer.

         Section 2.05. Exchange and Registration of Transfer of Debentures;
Restrictions on Transfer. (a) The Company shall cause to be kept at the
Corporate Trust Office a register (the register maintained in such office and in
any other office or agency of the Company designated pursuant to Section 5.02
being herein sometimes collectively referred to as the "DEBENTURE REGISTER") in
which, subject to such reasonable regulations as it may prescribe, the Company
shall provide for the registration of Debentures and for transfers of
Debentures. The Debenture Register shall be in written form or in any form
capable of being converted into written form within a reasonably prompt period
of time. The Trustee is hereby appointed "DEBENTURE REGISTRAR" for the purpose
of registering Debentures and transfers of Debentures as herein provided. The
Company may appoint one or more co-registrars in accordance with Section 5.02.

         Upon surrender for registration of transfer of any Debenture to the
Debenture Registrar or any co-registrar, and satisfaction of the requirements
for such transfer set forth in this Section 2.05, the Company shall execute, and
the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Debentures of any authorized
denominations and of a like aggregate principal amount and bearing such
restrictive legends as may be required by this Indenture.

         Debentures may be exchanged for other Debentures of any authorized
denominations and of a like aggregate principal amount, upon surrender of the
Debentures to be exchanged at any such office or agency maintained by the
Company pursuant to Section 5.02. Whenever any Debentures are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Debentures which the Debentureholder making the exchange is
entitled to receive bearing registration numbers not contemporaneously
outstanding.

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

         All Debentures presented or surrendered for registration of transfer or
for exchange, redemption, repurchase or conversion shall (if so required by the
Company or the Debenture

                                       16

<PAGE>

Registrar) be duly endorsed, or be accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company, duly executed by
the Debentureholder thereof or his attorney duly authorized in writing.

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

         Neither the Company nor the Trustee nor any Debenture Registrar shall
be required to exchange or register a transfer of (a) any Debentures for a
period of fifteen (15) days next preceding any selection of Debentures to be
redeemed, (b) any Debentures or portions thereof called for redemption pursuant
to Section 3.01, (c) any Debentures or portions thereof surrendered for
conversion pursuant to Article 15, (d) any Debentures or portions thereof
tendered for repurchase (and not withdrawn) pursuant to Section 3.05 or (e) any
Debentures or portions thereof tendered for repurchase (and not withdrawn)
pursuant to Section 3.06.

         (b)      The following provisions shall apply only to Global
Debentures:

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

                  (ii)     Notwithstanding any other provision in this
         Indenture, no Global Debenture may be exchanged in whole or in part for
         Debentures registered, and no transfer of a Global Debenture in whole
         or in part may be registered, in the name of any Person other than the
         Depositary or a nominee thereof unless (A) the Depositary (I) has
         notified the Company that it is unwilling or unable to continue as
         Depositary for such Global Debenture and a successor depositary has not
         been appointed by the Company within ninety (90) days or (II) has
         ceased to be a clearing agency registered under the Exchange Act, (B)
         an Event of Default has occurred and is continuing or (C) the Company,
         in its sole discretion, notifies the Trustee in writing that it no
         longer wishes to have all the Debentures represented by Global
         Debentures. Any Global Debenture exchanged pursuant to clause (A) or
         (B) above shall be so exchanged in whole and not in part and any Global
         Debenture exchanged pursuant to clause (C) above may be exchanged in
         whole or from time to time in part as directed by the Company. Any
         Debenture issued in exchange for a Global Debenture or any portion
         thereof shall be a Global Debenture; provided that any such Debenture
         so issued that is registered in the name of a Person other than the
         Depositary or a nominee thereof shall not be a Global Debenture.

                  (iii)    Securities issued in exchange for a Global Debenture
         or any portion thereof pursuant to clause (ii) above shall be issued in
         definitive, fully registered form, without interest coupons, shall have
         an aggregate principal amount equal to that of such Global Debenture or
         portion thereof to be so exchanged, shall be registered in such names
         and be in such authorized denominations as the Depositary shall
         designate and

                                       17

<PAGE>

         shall bear any legends required hereunder. Any Global Debentures to be
         exchanged in whole shall be surrendered by the Depositary to the
         Trustee, as Debenture Registrar. With regard to any Global Debenture to
         be exchanged in part, either such Global Debenture shall be so
         surrendered for exchange or, if the Trustee is acting as Custodian for
         the Depositary or its nominee with respect to such Global Debenture,
         the principal amount thereof shall be reduced, by an amount equal to
         the portion thereof to be so exchanged, by means of an appropriate
         adjustment made on the records of the Trustee. Upon any such surrender
         or adjustment, the Trustee shall authenticate and make available for
         delivery the Debenture issuable on such exchange to or upon the written
         order of the Depositary or an authorized representative thereof.

                  (iv)     In the event of the occurrence of any of the events
         specified in clause (ii) above, the Company will promptly make
         available to the Trustee a reasonable supply of certificated Debentures
         in definitive, fully registered form, without interest coupons.

                  (v)      Neither any members of, or participants in, the
         Depositary ("AGENT MEMBERS") nor any other Persons on whose behalf
         Agent Members may act shall have any rights under this Indenture with
         respect to any Global Debenture registered in the name of the
         Depositary or any nominee thereof, and the Depositary or such nominee,
         as the case may be, may be treated by the Company, the Trustee and any
         agent of the Company or the Trustee as the absolute owner and holder of
         such Global Debenture for all purposes whatsoever. Notwithstanding the
         foregoing, nothing herein shall prevent the Company, the Trustee or any
         agent of the Company or the Trustee from giving effect to any written
         certification, proxy or other authorization furnished by the Depositary
         or such nominee, as the case may be, or impair, as between the
         Depositary, its Agent Members and any other Person on whose behalf an
         Agent Member may act, the operation of customary practices of such
         Persons governing the exercise of the rights of a beneficial holder of
         any Debenture.

                  (vi)     At such time as all interests in a Global Debenture
         have been redeemed, repurchased, converted, canceled or exchanged for
         Debentures in certificated form, such Global Debenture shall, upon
         receipt thereof, be canceled by the Trustee in accordance with standing
         procedures and instructions existing between the Depositary and the
         Custodian. At any time prior to such cancellation, if any interest in a
         Global Debenture is redeemed, repurchased, converted, canceled or
         exchanged for Debentures in certificated form, the principal amount of
         such Global Debenture shall, in accordance with the standing procedures
         and instructions existing between the Depositary and the Custodian, be
         appropriately reduced, and an endorsement shall be made on such Global
         Debenture, by the Trustee or the Custodian, at the direction of the
         Trustee, to reflect such reduction.

         (c)      Every Debenture that bears or is required under this Section
2.05(c) to bear the legend set forth in this Section 2.05(c) (together with any
Common Stock issued upon conversion of the Debentures and required to bear the
legend set forth in Section 2.05(d), collectively, the "RESTRICTED SECURITIES")
shall be subject to the restrictions on transfer set forth in this Section
2.05(c) (including those set forth in the legend below) unless such restrictions
on transfer shall be waived by written consent of the Company, and the holder of
each such Restricted Security, by such holder's acceptance thereof, agrees to be
bound by all such

                                       18

<PAGE>

restrictions on transfer. As used in Section 2.05(c) and 2.05(d), the term
"TRANSFER" encompasses any sale, pledge, loan, transfer or other disposition
whatsoever of any Restricted Security or any interest therein.

         Until the expiration of the holding period applicable to sales thereof
under Rule 144(k) under the Securities Act (or any successor provision), any
certificate evidencing such Debenture (and all securities issued in exchange
therefor or substitution thereof, other than Common Stock, if any, issued upon
conversion thereof, which shall bear the legend set forth in Section 2.05(d), if
applicable) shall bear a legend in substantially the following form, unless such
Debenture has been sold pursuant to a registration statement that has been
declared effective under the Securities Act (and which continues to be effective
at the time of such transfer) or pursuant to Rule 144 under the Securities Act
or any similar provision then in force, or unless otherwise agreed by the
Company in writing, with written notice thereof to the Trustee:

         THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
         AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE
         OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR
         PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
         PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
         REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT
         TO, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE
         HEREOF, (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
         DEFINED IN RULE 144A UNDER THE SECURITIES ACT ("RULE 144A")); (2)
         AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR
         WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER
         SUCH SECURITY OR ANY COMMON STOCK ISSUABLE UPON CONVERSION OF SUCH
         SECURITY, PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO
         SALES OF THIS SECURITY UNDER RULE 144 UNDER THE SECURITIES ACT (OR ANY
         SUCCESSOR PROVISION) ONLY (A) TO THE ISSUER, (B) PURSUANT TO A
         REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
         SECURITIES ACT (AND WHICH CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH
         TRANSFER), (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE
         PURSUANT TO RULE 144A, IN COMPLIANCE WITH RULE 144A TO A PERSON IT
         REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER THAT PURCHASES
         FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
         BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
         RELIANCE ON RULE 144A OR (D) PURSUANT TO ANOTHER AVAILABLE EXEMPTION
         FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT; SUBJECT TO
         THE ISSUER'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
         TRANSFER PURSUANT TO CLAUSE (D) TO REQUIRE THE DELIVERY OF AN OPINION
         OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH
         OF THEM; AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM
         THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
         THIS LEGEND. THIS LEGEND

                                       19

<PAGE>

         WILL BE REMOVED UPON THE TRANSFER OF THIS SECURITY PURSUANT TO CLAUSE
         2(B) ABOVE OR UNDER RULE 144 UNDER THE SECURITIES ACT (OR ANY SUCCESSOR
         PROVISION).

         THE HOLDER OF THIS SECURITY IS ENTITLED TO THE BENEFITS OF A
         REGISTRATION RIGHTS AGREEMENT DATED AS OF OCTOBER 17, 2003 AND, BY ITS
         ACCEPTANCE HEREOF, AGREES TO BE BOUND BY AND TO COMPLY WITH THE
         PROVISIONS OF SUCH REGISTRATION RIGHTS AGREEMENT.

         Any Debenture (or security issued in exchange or substitution therefor)
as to which such restrictions on transfer shall have expired in accordance with
their terms or as to which the conditions for removal of the foregoing legend
set forth therein have been satisfied may, upon surrender of such Debenture for
exchange to the Debenture Registrar in accordance with the provisions of this
Section 2.05, be exchanged for a new Debenture or Debentures, of like tenor and
aggregate principal amount, which shall not bear the restrictive legend required
by this Section 2.05(c). If the Restricted Security surrendered for exchange is
represented by a Global Debenture bearing the legend set forth in this Section
2.05(c), the principal amount of the legended Global Debenture shall be reduced
by the appropriate principal amount and the principal amount of a Global
Debenture without the legend set forth in this Section 2.05(c) shall be
increased by an equal principal amount. If a Global Debenture without the legend
set forth in this Section 2.05(c) is not then outstanding, the Company shall
execute and the Trustee shall authenticate and deliver an unlegended Global
Debenture to the Depositary.

         (d)      Until the expiration of the holding period applicable to sales
thereof under Rule 144(k) under the Securities Act (or any successor provision),
any stock certificate representing Common Stock issued upon conversion of any
Debenture shall bear a legend in substantially the following form, unless such
Common Stock has been sold pursuant to a registration statement that has been
declared effective under the Securities Act (and which continues to be effective
at the time of such transfer) or pursuant to Rule 144 under the Securities Act
or any similar provision then in force, or such Common Stock has been issued
upon conversion of Debentures that have been transferred pursuant to a
registration statement that has been declared effective under the Securities Act
or pursuant to Rule 144 under the Securities Act or any similar provision then
in force, or unless otherwise agreed by the Company in writing with written
notice thereof to the transfer agent:

         THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
         AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE
         OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR
         PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
         PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
         REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT
         TO, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE
         HEREOF, (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
         DEFINED IN RULE 144A UNDER THE SECURITIES ACT ("RULE 144A")); (2)
         AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR
         WHICH IT HAS PURCHASED SECURITIES, TO

                                       20

<PAGE>

         OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE
         EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THIS SECURITY
         UNDER RULE 144 UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION)
         ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT THAT
         HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT (AND WHICH
         CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER), (C) FOR SO
         LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A,
         IN COMPLIANCE WITH RULE 144A TO A PERSON IT REASONABLY BELIEVES IS A
         QUALIFIED INSTITUTIONAL BUYER THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR
         THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN
         THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A OR (D)
         PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
         REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER'S AND THE
         TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
         CLAUSE (D) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
         CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM;
         AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS
         SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
         LEGEND. THIS LEGEND WILL BE REMOVED UPON THE EARLIER OF THE TRANSFER OF
         THIS SECURITY PURSUANT TO CLAUSE 2(B) ABOVE OR UPON ANY TRANSFER OF
         THIS SECURITY UNDER RULE 144 UNDER THE SECURITIES ACT (OR ANY SUCCESSOR
         PROVISION).

         THE HOLDER OF THIS SECURITY IS ENTITLED TO THE BENEFITS OF A
         REGISTRATION RIGHTS AGREEMENT DATED AS OF OCTOBER 17, 2003 AND, BY ITS
         ACCEPTANCE HEREOF, AGREES TO BE BOUND BY AND TO COMPLY WITH THE
         PROVISIONS OF SUCH REGISTRATION RIGHTS AGREEMENT.

         Any such Common Stock as to which such restrictions on transfer shall
have expired in accordance with their terms or as to which the conditions for
removal of the foregoing legend set forth therein have been satisfied may, upon
surrender of the certificates representing such shares of Common Stock for
exchange in accordance with the procedures of the transfer agent for the Common
Stock, be exchanged for a new certificate or certificates for a like number of
shares of Common Stock, which shall not bear the restrictive legend required by
this Section 2.05(d).

         (e)      Any Debenture or Common Stock issued upon the conversion of a
Debenture that, prior to the expiration of the holding period applicable to
sales thereof under Rule 144(k) under the Securities Act (or any successor
provision), is purchased or owned by the Company or any Affiliate thereof may
not be resold by the Company or such Affiliate unless registered under the
Securities Act or resold pursuant to an exemption from the registration
requirements of the Securities Act in a transaction which results in such
Debentures or Common Stock, as the case may be, no longer being "RESTRICTED
SECURITIES" (as defined under Rule 144).

         The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable

                                       21

<PAGE>

law with respect to any transfer of any interest in any Debenture (including any
transfers between or among Agent Members or beneficial holders of interests in
any Global Debenture) other than to require delivery of such certificates and
other documentation or evidence as are expressly required by, and to do so if
and when expressly required by, the terms of this Indenture, and to examine the
same to determine substantial compliance as to form with the express
requirements hereof.

         Section 2.06. Mutilated, Destroyed, Lost or Stolen Debentures. In case
any Debenture shall become mutilated or be destroyed, lost or stolen, the
Company in its discretion may execute, and upon its written request the Trustee
or an authenticating agent appointed by the Trustee shall authenticate and make
available for delivery, a new Debenture, bearing a number not contemporaneously
outstanding, in exchange and substitution for the mutilated Debenture, or in
lieu of and in substitution for the Debenture so destroyed, lost or stolen. In
every case, the applicant for a substituted Debenture shall furnish to the
Company, to the Trustee and, if applicable, to such authenticating agent such
security or indemnity as may be required by them to save each of them harmless
for any loss, liability, cost or expense caused by or connected with such
substitution, and, in every case of destruction, loss or theft, the applicant
shall also furnish to the Company, to the Trustee and, if applicable, to such
authenticating agent evidence to their satisfaction of the destruction, loss or
theft of such Debenture and of the ownership thereof.

         Following receipt by the Trustee or such authenticating agent, as the
case may be, of satisfactory security or indemnity and evidence as described in
the preceding paragraph, the Trustee or such authenticating agent may
authenticate any such substituted Debenture and make available for delivery such
Debenture. Upon the issuance of any substituted Debenture, the Company may
require the payment by the holder of a sum sufficient to cover any tax,
assessment or other governmental charge that may be imposed in relation thereto
and any other expenses connected therewith. In case any Debenture which has
matured or is about to mature or has been called for redemption or has been
tendered for repurchase upon a Repurchase Date (and not withdrawn) or is to be
converted into Common Stock shall become mutilated or be destroyed, lost or
stolen, the Company may, instead of issuing a substitute Debenture, pay or
authorize the payment of or convert or authorize the conversion of the same
(without surrender thereof except in the case of a mutilated Debenture), as the
case may be, if the applicant for such payment or conversion shall furnish to
the Company, to the Trustee and, if applicable, to such authenticating agent
such security or indemnity as may be required by them to save each of them
harmless from any loss, liability, cost or expense caused by or in connection
with such substitution, and, in every case of destruction, loss or theft, the
applicant shall also furnish to the Company, the Trustee and, if applicable, any
Paying Agent or Conversion Agent evidence to their satisfaction of the
destruction, loss or theft of such Debenture and of the ownership thereof.

         Every substitute Debenture issued pursuant to the provisions of this
Section 2.06 by virtue of the fact that any Debenture is destroyed, lost or
stolen shall constitute an additional contractual obligation of the Company,
whether or not the destroyed, lost or stolen Debenture shall be found at any
time, and shall be entitled to all the benefits of (but shall be subject to all
the limitations set forth in) this Indenture equally and proportionately with
any and all other Debentures duly issued hereunder. To the extent permitted by
law, all Debentures shall be held and owned upon the express condition that the
foregoing provisions are exclusive with respect to the replacement or payment or
conversion or redemption or repurchase of mutilated, destroyed,

                                       22

<PAGE>

lost or stolen Debentures and shall preclude any and all other rights or
remedies notwithstanding any law or statute existing or hereafter enacted to the
contrary with respect to the replacement or payment or conversion or redemption
or repurchase of negotiable instruments or other securities without their
surrender.

         Section 2.07. Temporary Debentures. Pending the preparation of
Debentures in certificated form, the Company may execute and the Trustee or any
authenticating agent appointed by the Trustee shall, upon the written request of
the Company, authenticate and deliver temporary Debentures (printed or
lithographed). Temporary Debentures shall be issuable in any authorized
denomination, and substantially in the form of the Debentures in certificated
form, but with such omissions, insertions and variations as may be appropriate
for temporary Debentures, all as may be determined by the Company. Every such
temporary Debenture shall be executed by the Company and authenticated by the
Trustee or such authenticating agent upon the same conditions and in
substantially the same manner, and with the same effect, as the Debentures in
certificated form. Without unreasonable delay, the Company will execute and
deliver to the Trustee or such authenticating agent Debentures in certificated
form and thereupon any or all temporary Debentures may be surrendered in
exchange therefor, at each office or agency maintained by the Company pursuant
to Section 5.02, and the Trustee or such authenticating agent shall authenticate
and make available for delivery in exchange for such temporary Debentures an
equal aggregate principal amount of Debentures in certificated form. Such
exchange shall be made by the Company at its own expense and without any charge
therefor. Until so exchanged, the temporary Debentures shall in all respects be
entitled to the same benefits and subject to the same limitations under this
Indenture as Debentures in certificated form authenticated and delivered
hereunder.

         Section 2.08. Cancellation of Debentures. All Debentures surrendered
for the purpose of payment, redemption, repurchase, conversion, exchange or
registration of transfer shall, if surrendered to the Company or any Paying
Agent or any Debenture Registrar or any Conversion Agent, be surrendered to the
Trustee and promptly canceled by it, or, if surrendered to the Trustee, shall be
promptly canceled by it, and no Debentures shall be issued in lieu thereof
except as expressly permitted by any of the provisions of this Indenture. The
Trustee shall dispose of such canceled Debentures in accordance with its
customary procedures. If the Company shall acquire any of the Debentures, such
acquisition shall not operate as a redemption, repurchase or satisfaction of the
Indebtedness represented by such Debentures unless and until the same are
delivered to the Trustee for cancellation.

         Section 2.09. CUSIP Numbers. The Company in issuing the Debentures may
use "CUSIP" numbers (if then generally in use), and, if so, the Trustee shall
use "CUSIP" numbers in notices of redemption as a convenience to
Debentureholders; provided that any such notice may state that no representation
is made as to the correctness of such numbers either as printed on the
Debentures or as contained in any notice of a redemption and that reliance may
be placed only on the other identification numbers printed on the Debentures,
and any such redemption shall not be affected by any defect in or omission of
such numbers. The Company will promptly notify the Trustee of any change in the
"CUSIP" numbers.

                                       23

<PAGE>

                                   ARTICLE 3
                     REDEMPTION AND REPURCHASE OF DEBENTURES

         Section 3.01. Company's Right to Redeem. Prior to October 8, 2008, the
Debentures will not be redeemable at the Company's option. At any time on or
after October 8, 2008 and prior to Stated Maturity, the Company, at its option,
may redeem the Debentures in accordance with the provisions of Section 3.02,
Section 3.03 and Section 3.04 on the Redemption Date for cash, in whole or in
part, at a redemption price (the "REDEMPTION PRICE") equal to 100% of the
principal amount of the Debentures to be redeemed together in each case with
accrued and unpaid interest on the Debentures redeemed to (but excluding) the
Redemption Date.

         Section 3.02. Notice of Optional Redemption; Selection of Debentures.
(a) In case the Company shall desire to exercise the right to redeem all or, as
the case may be, any part of the Debentures pursuant to Section 3.01, it shall
fix a date for redemption (the "REDEMPTION DATE") and it or, at its written
request received by the Trustee not fewer than forty-five (45) days prior (or
such shorter period of time as may be acceptable to the Trustee) to the
Redemption Date, the Trustee in the name of and at the expense of the Company,
shall mail or cause to be mailed a notice of such redemption (a "REDEMPTION
NOTICE") not fewer than thirty (30) nor more than sixty (60) days prior to the
Redemption Date to each holder of Debentures so to be redeemed as a whole or in
part at its last address as the same appears on the Debenture Register; provided
that if the Company shall give such notice, it shall also give written notice of
the Redemption Date to the Trustee. Such mailing shall be by first class mail.
The notice, if mailed in the manner herein provided, shall be conclusively
presumed to have been duly given, whether or not the holder receives such
notice. In any case, failure to give such notice by mail or any defect in the
notice to the holder of any Debenture designated for redemption as a whole or in
part shall not affect the validity of the proceedings for the redemption of any
other Debenture. Concurrently with the mailing of any such Redemption Notice,
the Company shall issue a press release announcing such redemption, the form and
content of which press release shall be determined by the Company in its sole
discretion. The failure to issue any such press release or any defect therein
shall not affect the validity of the Redemption Notice or any of the proceedings
for the redemption of any Debenture called for redemption.

         (b)      Each such Redemption Notice shall specify the aggregate
principal amount of Debentures to be redeemed, the CUSIP number or numbers of
the Debentures being redeemed, the Redemption Date (which shall be a Business
Day), the Redemption Price at which Debentures are to be redeemed, the place or
places of payment, that payment will be made upon presentation and surrender of
such Debentures, that interest accrued to the Redemption Date will be paid as
specified in said notice, and that on and after said date interest thereon or on
the portion thereof to be redeemed will cease to accrue. Such notice shall also
state the current Conversion Rate, the date on which the right to convert such
Debentures or portions thereof into Common Stock will expire (which date shall
not be later than the close of business on the second Business Day prior to the
Redemption Date), whether the Company has elected to satisfy all or a portion of
its Conversion Obligation with cash in lieu of delivery of shares of Common
Stock with respect to any Debentures converted prior to the Redemption Date and,
if the Company has determined to satisfy all or any portion of the Conversion
Obligation in cash, the dollar amount of the conversion to be satisfied in cash
(which must be expressed either as 100% of the Conversion Obligation or as a
fixed dollar amount). If fewer than all the Debentures are to be

                                       24

<PAGE>

redeemed, the Redemption Notice shall identify the Debentures to be redeemed
(including CUSIP numbers, if any). In case any Debenture is to be redeemed in
part only, the Redemption Notice shall state the portion of the principal amount
thereof to be redeemed and shall state that, on and after the Redemption Date,
upon surrender of such Debenture, a new Debenture or Debentures in principal
amount equal to the unredeemed portion thereof will be issued.

         (c)      On or prior to the Redemption Date specified in the Redemption
Notice given as provided in this Section 3.02, the Company will deposit with the
Trustee or with one or more Paying Agents (or, if the Company is acting as its
own Paying Agent, set aside, segregate and hold in trust as provided in Section
5.04) an amount of money in immediately available funds sufficient to redeem on
the Redemption Date all the Debentures (or portions thereof) so called for
redemption (other than those theretofore surrendered for conversion into Common
Stock) at the appropriate Redemption Price; provided that if such payment is
made on the Redemption Date, it must be received by the Trustee or Paying Agent,
as the case may be, by 10:00 a.m., New York City time, on such date. The Company
shall be entitled to retain any interest, yield or gain on amounts deposited
with the Trustee or any Paying Agent pursuant to this Section 3.02(c) in excess
of amounts required hereunder to pay the Redemption Price and accrued interest
to, but excluding, the Redemption Date. Subject to the last sentence of Section
8.05, if any Debenture called for redemption is converted pursuant hereto prior
to such Redemption Date, any money deposited with the Trustee or any Paying
Agent or so segregated and held in trust for the redemption of such Debenture
shall be paid to the Company upon its written request, or, if then held by the
Company, shall be discharged from such trust. Whenever any Debentures are to be
redeemed, the Company will give the Trustee written notice in the form of an
Officers' Certificate not fewer than thirty-five (35) days (or such shorter
period of time as may be acceptable to the Trustee) prior to the Redemption Date
as to the aggregate principal amount of Debentures to be redeemed.

         (d)      If less than all of the outstanding Debentures are to be
redeemed, the Trustee shall select the Debentures or portions thereof of the
Global Debenture or the Debentures in certificated form to be redeemed (in
principal amounts of $1,000 or multiples thereof) by lot, on a pro rata basis or
by another method the Trustee deems fair and appropriate. If any Debenture
selected for partial redemption is submitted for conversion in part after such
selection, the portion of such Debenture submitted for conversion shall be
deemed (so far as may be possible) to be from the portion selected for
redemption. The Debentures (or portions thereof) so selected shall be deemed
duly selected for redemption for all purposes hereof, notwithstanding that any
such Debenture is submitted for conversion in part before the mailing of the
Redemption Notice.

         Upon any redemption of less than all of the outstanding Debentures, the
Company and the Trustee may (but need not), solely for purposes of determining
the pro rata allocation among such Debentures as are unconverted and outstanding
at the time of redemption, treat as outstanding any Debentures surrendered for
conversion during the period of fifteen (15) days next preceding the mailing of
a Redemption Notice and may (but need not) treat as outstanding any Debenture
authenticated and delivered during such period in exchange for the unconverted
portion of any Debenture converted in part during such period.

         Section 3.03. Payment of Debentures Called for Redemption by the
Company. If notice of redemption has been given as provided in Section 3.02, the
Debentures or portion of

                                       25

<PAGE>

Debentures with respect to which such notice has been given shall, unless
converted into Common Stock pursuant to the terms hereof, become due and payable
on the Redemption Date and at the place or places stated in such notice at the
applicable Redemption Price, and on and after the Redemption Date (unless the
Company shall default in the payment of such Debentures at the Redemption Price)
interest on the Debentures or portion of Debentures so called for redemption
shall cease to accrue and, after the close of business on the second Business
Day immediately preceding the Redemption Date (unless the Company shall default
in the payment of such Debentures at the Redemption Price), such Debentures
shall cease to be convertible into Common Stock and, except as provided in
Section 8.05, to be entitled to any benefit or security under this Indenture,
and the holders thereof shall have no right in respect of such Debentures except
the right to receive the Redemption Price thereof. On presentation and surrender
of such Debentures at a place of payment in said notice specified, the said
Debentures or the specified portions thereof shall be paid and redeemed by the
Company at the applicable Redemption Price; provided that if the applicable
Redemption Date is an Interest Payment Date, the interest payable on such
Interest Payment Date shall be paid on such Interest Payment Date to the holders
of record of such Debentures on the applicable record date instead of the
holders surrendering such Debentures for redemption on such date.

         Upon presentation of any Debenture redeemed in part only, the Company
shall execute and the Trustee shall authenticate and make available for delivery
to the holder thereof, at the expense of the Company, a new Debenture or
Debentures, of authorized denominations, in principal amount equal to the
unredeemed portion of the Debentures so presented.

         Notwithstanding the foregoing, the Trustee shall not redeem any
Debentures or mail any Redemption Notice during the continuance of a default in
payment of interest on the Debentures. If any Debenture called for redemption
shall not be so paid upon surrender thereof for redemption, the principal shall,
until paid or duly provided for, continue to bear interest at the rate borne by
the Debenture, compounded semiannually, and such Debenture shall remain
convertible into Common Stock until the principal and interest shall have been
paid or duly provided for.

         Section 3.04. Conversion Arrangement on Call for Redemption. In
connection with any redemption of Debentures, the Company may arrange for the
purchase and conversion of any Debentures by an agreement with one or more
investment banks or other purchasers to purchase such Debentures by paying to
the Trustee in trust for the Debentureholders, on or before the Redemption Date,
an amount not less than the applicable Redemption Price of such Debentures.
Notwithstanding anything to the contrary contained in this Article 3, the
obligation of the Company to pay the Redemption Price of such Debentures shall
be deemed to be satisfied and discharged to the extent such amount is so paid by
such purchasers. If such an agreement is entered into, a copy of which will be
filed with the Trustee prior to the Redemption Date, any Debentures not duly
surrendered for conversion by the holders thereof may, at the option of the
Company, be deemed, to the fullest extent permitted by law, acquired by such
purchasers from such holders and (notwithstanding anything to the contrary
contained in Article 15) surrendered by such purchasers for conversion, all as
of immediately prior to the close of business on the Redemption Date (and the
right to convert any such Debentures shall be extended through such time),
subject to payment of the above amount as aforesaid. At the direction of the
Company, the Trustee shall hold and dispose of any such amount paid to it in the
same manner as it would

                                       26

<PAGE>

monies deposited with it by the Company for the redemption of Debentures.
Without the Trustee's prior written consent, no arrangement between the Company
and such purchasers for the purchase and conversion of any Debentures shall
increase or otherwise affect any of the powers, duties, responsibilities or
obligations of the Trustee as set forth in this Indenture.

         Section 3.05. Repurchase of Debentures by the Company at Option of
Holders upon a Fundamental Change. (a) If a Fundamental Change shall occur at
any time prior to Stated Maturity, each holder shall have the right, at such
holder's option, to require the Company to repurchase all of such holder's
Debentures, or any portion thereof that is a multiple of $1,000 principal
amount, on the date specified in the Fundamental Change Repurchase Notice, which
date shall be no more than thirty-five (35) Business Days after the occurrence
of such Fundamental Change but in no event prior to the date on which such
Fundamental Change occurs (the "FUNDAMENTAL CHANGE REPURCHASE DATE"). The
Company shall repurchase such Debentures at a price (the "FUNDAMENTAL CHANGE
REPURCHASE PRICE") equal to 100% of the principal amount thereof plus any
accrued and unpaid interest to but excluding the Fundamental Change Repurchase
Date; provided that if such Fundamental Change Repurchase Date falls on an
Interest Payment Date, then the interest payable on such Interest Payment Date
shall be paid to the holders of record of the Debentures on the applicable
record date instead of the holders surrendering the Debentures for repurchase on
such date.

         The Company's obligation to repurchase all or a portion of a holder's
Debentures under this Section 3.05 shall be satisfied if a third party makes the
offer to repurchase the Debentures at the Fundamental Change Repurchase Price in
the manner and at the times and otherwise in compliance in all material respects
with the requirements set out in this Section 3.05 and such third party complies
with the obligations of the Company in connection herewith.

         (b)      On or before the twenty-fifth (25th) Business Day prior to
each Fundamental Change Repurchase Date, the Company, or at its written request
the Trustee in the name of and at the expense of the Company (which request must
be received by the Trustee at least ten (10) Business Days prior to the date the
Trustee is requested to give notice as described below), unless the Trustee
shall agree to a shorter period), shall mail or cause to be mailed, by first
class mail, to all holders of record on such date a notice (the "FUNDAMENTAL
CHANGE REPURCHASE NOTICE") of the occurrence of such Fundamental Change and of
the repurchase right at the option of the holders arising as a result thereof to
each holder of Debentures at its last address as the same appears on the
Debenture Register; provided that if the Company shall give such notice, it
shall also give written notice of the Fundamental Change to the Trustee at such
time as it is mailed to Debentureholders. Such notice, if mailed in the manner
herein provided, shall be conclusively presumed to have been duly given, whether
or not the holder receives such notice. Each Fundamental Change Repurchase
Notice shall state:

                  (i)      the Fundamental Change Repurchase Price, excluding
         accrued and unpaid interest, the applicable Conversion Rate at the time
         of such notice (and any applicable adjustments to the Conversion Rate)
         and, to the extent known at the time of such notice, the amount of
         interest that will be payable with respect to the Debentures on the
         Fundamental Change Repurchase Date;

                                       27

<PAGE>

                  (ii)     whether the Company elects to pay the Fundamental
         Change Repurchase Price in cash, in shares of Common Stock or a
         combination thereof, specifying the percentage or amount of each;

                  (iii)    if the Company elects to pay any portion of the
         Fundamental Change Repurchase Price in shares of Common Stock, the
         method of calculating the Market Price of the Common Stock;

                  (iv)     the events causing the Fundamental Change and the
         date of the Fundamental Change;

                  (v)      the Fundamental Change Repurchase Date;

                  (vi)     the last date on which a holder may exercise the
                           repurchase right;

                  (vii)    the name and address of the Paying Agent and the
         Conversion Agent;

                  (viii)   that Debentures as to which a Fundamental Change
         Repurchase Election has been given by the holder may be converted only
         if the election has been withdrawn by the holder in accordance with the
         terms of this Indenture; provided that the Debentures are otherwise
         convertible in accordance with Section 15.01;

                  (ix)     that the holder shall have the right to withdraw any
         Debentures surrendered prior to the close of business on the Business
         Day immediately preceding the Fundamental Change Repurchase Date (or
         any such later time as may be required by applicable law);

                  (x)      a description of the procedure which a
         Debentureholder must follow to exercise such repurchase right or to
         withdraw any surrendered Debentures;

                  (xi)     the CUSIP number or numbers of the Debentures (if
         then generally in use); and

                  (xii)    briefly, the conversion rights of the Debentures and
         whether, at the time of such notice, the Debentures are eligible for
         conversion.

         No failure of the Company to give the foregoing notices and no defect
therein shall limit the Debentureholders' repurchase rights or affect the
validity of the proceedings for the repurchase of the Debentures pursuant to
this Section 3.05.

         (c)      Debentures shall be repurchased pursuant to this Section 3.05
at the option of the holder upon:

                  (i)      delivery to the Trustee (or other Paying Agent
         appointed by the Company) by a holder of a duly completed notice (a
         "FUNDAMENTAL CHANGE REPURCHASE ELECTION") in the form set forth on the
         reverse of the Debenture at any time prior to the close of business on
         the Business Day immediately preceding the Fundamental Change
         Repurchase Date stating:

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<PAGE>

                  (A)      if certificated, the certificate numbers of the
         Debentures which the holder shall deliver to be repurchased;

                  (B)      the portion of the principal amount of the Debentures
         that the holder shall deliver to be repurchased, which portion must be
         $1,000 or an integral multiple thereof;

                  (C)      that such Debentures shall be repurchased as of the
         Fundamental Change Repurchase Date pursuant to the terms and conditions
         specified in the Debentures and in the Indenture; and

                  (D)      in the event the Company elects to pay the
         Fundamental Change Repurchase Price, in whole or in part, in shares of
         Common Stock but such portion of the Fundamental Change Repurchase
         Price shall ultimately be paid to such holder entirely in cash because
         any of the conditions to payment of the Fundamental Change Repurchase
         Price in shares of Common Stock is not satisfied prior to the close of
         business on the Business Day prior to the relevant Fundamental Change
         Repurchase Date, whether such holder elects (i) to withdraw such
         Fundamental Change Repurchase Election as to some or all of the
         Debentures to which such election relates (stating the principal amount
         and certificate numbers, if any, of the Debentures as to which such
         withdrawal shall relate) or (ii) to receive cash in respect of the
         entire Fundamental Change Repurchase Price for all Debentures (or
         portions thereof) to which such election relates; and

                  (ii)     delivery or book-entry transfer of the Debentures to
         the Trustee (or other Paying Agent appointed by the Company)
         simultaneously with or at any time after delivery of the Fundamental
         Change Repurchase Election (together with all necessary endorsements)
         at the Corporate Trust Office of the Trustee (or other Paying Agent
         appointed by the Company) in the Borough of Manhattan, such delivery or
         transfer being a condition to receipt by the holder of the Fundamental
         Change Repurchase Price therefor; provided that such Fundamental Change
         Repurchase Price shall be so paid pursuant to this Section 3.05 only if
         the Debentures so delivered or transferred to the Trustee (or other
         Paying Agent appointed by the Company) shall conform in all respects to
         the description thereof in the related Fundamental Change Repurchase
         Election. All questions as to the validity, eligibility (including time
         of receipt) and acceptance of any Debenture for repurchase shall be
         determined by the Company, whose determination shall be final and
         binding absent manifest error.

         If a holder fails to indicate such holder's choice with respect to the
election set forth in Section 3.05(c)(i)(D), such holder shall be deemed to have
elected to receive cash in respect of the entire Fundamental Change Repurchase
Price for all Debentures subject to such Fundamental Change Repurchase Election
in the circumstances set forth in Section 3.05(c)(i)(D).

         Section 3.06. Repurchase of Debentures by the Company at Option of
Holders on Specified Dates. (a) On each of October 1, 2008, October 1, 2013 and
October 1, 2018 (each, a "COMPANY REPURCHASE DATE"), each holder shall have the
right, at such holder's option, to

                                       29

<PAGE>

require the Company to repurchase all of such holder's Debentures, or any
portion thereof that is a multiple of $1,000 principal amount. The Company shall
repurchase such Debentures at a price (the "COMPANY REPURCHASE PRICE") equal to
100% of the principal amount thereof plus any accrued and unpaid interest to but
excluding the Company Repurchase Date; provided that if such Company Repurchase
Date falls on an Interest Payment Date, then the interest payable on such
Interest Payment Date shall be paid to the holders of record of the Debentures
on the applicable record date instead of the holders surrendering the Debentures
for repurchase on such date.

         (b)      On or before the twenty-fifth (25th) Business Day prior to
each Company Repurchase Date, the Company, or at its written request the Trustee
in the name of and at the expense of the Company (which request must be received
by the Trustee at least ten (10) Business Days prior to the date the Trustee is
requested to give notice as described below), unless the Trustee shall agree to
a shorter period), shall mail or cause to be mailed, by first class mail, to all
holders of record on such date a notice (the "COMPANY REPURCHASE NOTICE") to
each holder of Debentures at its last address as the same appears on the
Debenture Register; provided that if the Company shall give such notice, it
shall also give written notice to the Trustee at such time as it is mailed to
Debentureholders. Such notice, if mailed in the manner herein provided, shall be
conclusively presumed to have been duly given, whether or not the holder
receives such notice. Each Company Repurchase Notice shall state:

                  (i)      the Company Repurchase Price, excluding accrued and
         unpaid interest, the applicable Conversion Rate at the time of such
         notice (and any applicable adjustments to the Conversion Rate) and, to
         the extent known at the time of such notice, the amount of interest
         that will be payable with respect to the Debentures on the Company
         Repurchase Date;

                  (ii)     whether the Company elects to pay the Company
         Repurchase Price in cash, in shares of Common Stock or a combination
         thereof, specifying the percentage or amounts of each;

                  (iii)    if the Company elects to pay any portion of the
         Company Repurchase Price in whole or in part in shares of Common Stock,
         the method of calculating the Market Price of the Common Stock;

                  (iv)     the Company Repurchase Date;

                  (v)      the last date on which a holder may exercise the
         repurchase right;

                  (vi)     the name and address of the Paying Agent and the
         Conversion Agent;

                  (vii)    that Debentures as to which a Company Repurchase
         Election has been given by the holder may be converted only if the
         election has been withdrawn by the holder in accordance with the terms
         of this Indenture; provided that the Debentures are otherwise
         convertible in accordance with Section 15.01;

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<PAGE>

                  (viii)   that the holder shall have the right to withdraw any
         Debentures surrendered prior to the close of business on the Business
         Day immediately preceding the Company Repurchase Date (or any such
         later time as may be required by applicable law);

                  (ix)     a description of the procedure which a
         Debentureholder must follow to exercise such repurchase right or to
         withdraw any surrendered Debentures;

                  (x)      the CUSIP number or numbers of the Debentures (if
         then generally in use); and

                  (xi)     briefly, the conversion rights of the Debentures and
         whether, at the time of such notice, the Debentures are eligible for
         conversion.

         No failure of the Company to give the foregoing notices and no defect
therein shall limit the Debentureholders' repurchase rights or affect the
validity of the proceedings for the repurchase of the Debentures pursuant to
this Section 3.06.

         (c)      Debentures shall be repurchased pursuant to this Section 3.06
at the option of the holder upon:

                  (i)      delivery to the Trustee (or other Paying Agent
         appointed by the Company) by a holder of a duly completed notice (a
         "COMPANY REPURCHASE ELECTION") in the form set forth on the reverse of
         the Debenture at any time from the opening of business on the twentieth
         (20th) Business Day preceding the Company Repurchase Date until the
         close of business on the Business Day immediately preceding the Company
         Repurchase Date stating:

                           (A)      if certificated, the certificate numbers of
                  the Debentures which the holder shall deliver to be
                  repurchased;

                           (B)      the portion of the principal amount of the
                  Debentures that the holder shall deliver to be repurchased,
                  which portion must be $1,000 or an integral multiple thereof;

                           (C)      that such Debentures shall be repurchased as
                  of the Company Repurchase Date pursuant to the terms and
                  conditions specified in the Debentures and in this Indenture;
                  and

                           (D)      in the event the Company elects to pay the
                  Company Repurchase Price, in whole or in part, in shares of
                  Common Stock but such portion of the Company Repurchase Price
                  shall ultimately be paid to such holder entirely in cash
                  because any of the conditions to payment of the Company
                  Repurchase Price in shares of Common Stock is not satisfied
                  prior to the close of business on the Business Day prior to
                  the relevant Company Repurchase Date, whether such holder
                  elects (i) to withdraw the Company Repurchase Election as to
                  some or all of the Debentures to which such election relates
                  (stating the principal amount and certificate numbers, if any,
                  of the Debentures as to which such withdrawal shall

                                       31

<PAGE>

                  relate), or (ii) to receive cash in respect of the entire
                  Repurchase Price for all Debentures (or portions thereof) to
                  which such election relates; and

                  (ii)     delivery or book-entry transfer of the Debentures to
         the Trustee (or other Paying Agent appointed by the Company)
         simultaneously with or at any time after delivery of the Company
         Repurchase Election (together with all necessary endorsements) at the
         Corporate Trust Office of the Trustee (or other Paying Agent appointed
         by the Company) in the Borough of Manhattan, such delivery or transfer
         being a condition to receipt by the holder of the Company Repurchase
         Price therefor; provided that such Company Repurchase Price shall be so
         paid pursuant to this Section 3.06 only if the Debentures so delivered
         or transferred to the Trustee (or other Paying Agent appointed by the
         Company) shall conform in all respects to the description thereof in
         the related Company Repurchase Election. All questions as to the
         validity, eligibility (including time of receipt) and acceptance of any
         Debenture for repurchase shall be determined by the Company, whose
         determination shall be final and binding absent manifest error.

         If a holder fails to indicate such holder's choice with respect to the
election set forth in Section 3.06(c)(i)(D), such holder shall be deemed to have
elected to receive cash in respect of the entire Company Repurchase Price for
all Debentures subject to such Company Repurchase Election in the circumstances
set forth in Section 3.06(c)(i)(D).

         Section 3.07. Company's Right to Elect Manner of Payment of Repurchase
Price. (a) The Debentures to be repurchased by the Company on any Repurchase
Date pursuant to Section 3.05 or Section 3.06 (other than the Company Repurchase
Date occurring on October 1, 2008), may be paid for, in whole or in part, at the
election of the Company, in U.S. legal tender ("CASH") or shares of Common
Stock, or in any combination of cash and shares of Common Stock, subject to the
conditions set forth in Section 3.07(e). The Repurchase Price with respect to
the Company Repurchase Date occurring on October 1, 2008 shall be paid only in
cash. The Company shall designate in its Repurchase Notice whether the Company
will purchase the Debentures for cash or shares of Common Stock, or, if a
combination thereof, the percentage of the Repurchase Price that it will pay in
cash and the percentage that it will pay in shares of Common Stock; provided
that the Company will pay cash for accrued and unpaid interest and for
fractional interests in shares of Common Stock in an amount based upon the
Market Price of such fractional shares. For purposes of determining the amount
of any fractional interests, all Debentures subject to repurchase held by a
holder shall be considered together (no matter how many separate certificates
are to be presented).

         (b)      Each holder whose Debentures are repurchased pursuant to
Section 3.05 or Section 3.06 shall receive the same percentage of cash or shares
of Common Stock in payment of the Repurchase Price for such Debentures as any
other holder whose Debentures are repurchased, except (i) as provided in Section
3.07(a) with regard to the payment of cash in lieu of fractional shares of
Common Stock and (ii) in the event that the Company is unable to purchase the
Debentures of a holder or holders for shares of Common Stock because any
necessary qualifications or registrations of the shares of Common Stock under
applicable state securities laws cannot be obtained, or because the conditions
to purchasing the Debentures for shares of Common Stock set forth in Section
3.07(e) have not been satisfied, the Company may purchase the Debentures of such
holder or holders for cash. The Company may not change its

                                       32

<PAGE>

election with respect to the consideration (or components or percentages of
components thereof) to be paid once the Company has given its Repurchase Notice
to holders except pursuant to Section 3.07(e) in the event of a failure to
satisfy, prior to the close of business on the Business Day immediately
preceding the Repurchase Date, any condition to the payment of the Repurchase
Price in whole or in part in shares of Common Stock.

         (c)      At least three (3) Business Days before the date of any
Repurchase Notice, the Company shall deliver an Officers' Certificate to the
Trustee specifying:

                  (i)      the manner of payment selected by the Company;

                  (ii)     the information required to be included in the
         Repurchase Notice;

                  (iii)    if the Company elects to pay the Repurchase Price, or
         a specified percentage thereof, in shares of Common Stock, that the
         conditions to such manner of payment set forth in Section 3.07(e) have
         been or will be complied with; and

                  (iv)     whether the Company desires the Trustee to give the

         Repurchase Notice required.

         (d)      If the Company elects to pay the Repurchase Price, or any
percentage thereof, with respect to a Repurchase Date in shares of Common Stock,
the number of shares of Common Stock to be delivered with respect to each $1,000
principal amount of Debentures shall be equal to the quotient obtained by
dividing (i) the dollar amount of the Repurchase Price (not including any
accrued and unpaid interest) to be paid in shares of Common Stock by (ii) (x) in
the case of a repurchase pursuant to Section 3.05, 98.5% of the Market Price
with respect to such Repurchase Date and (y) in the case of a repurchase
pursuant to Section 3.06, 98.5% of the Market Price with respect to such
Repurchase Date; provided that no fractional shares will be delivered.

         (e)      The Company's right to elect to pay some or all of the
Repurchase Price with respect to a Repurchase Date by delivering shares of
Common Stock shall be conditioned upon:

                  (i)      the Company giving timely notice of its election and
         not having previously given notice of an election to pay the Repurchase
         Price with respect to such Repurchase Date entirely in cash;

                  (ii)     the approval for listing of such shares of Common
         Stock on a national securities exchange or the approval for quotation
         of such shares of Common Stock on the Nasdaq Automated Quotation
         System;

                  (iii)    information necessary to calculate the Market Price
         being published in a daily newspaper of national circulation or being
         otherwise readily publicly available;

                  (iv)     the registration of such shares of Common Stock under
         the Securities Act and the Exchange Act, in each case if required;

                  (v)      any necessary qualification or registration under
         applicable state securities laws or the availability of an exemption
         from such qualification and registration; and

                                       33

<PAGE>

                  (vi)     the receipt by the Trustee of an Officers'
         Certificate and an Opinion of Counsel each stating that (A) the terms
         of the issuance of the shares of Common Stock are in conformity with
         this Indenture and (B) the shares of Common Stock to be issued by the
         Company in payment of the Repurchase Price in respect of Debentures
         have been duly authorized and, when issued and delivered pursuant to
         the terms of this Indenture in payment of the Repurchase Price, will be
         validly issued, fully paid and nonassessable and free from preemptive
         rights under the Company's Certificate of Incorporation and By-laws and
         the Delaware General Corporation Law, and, in the case of such
         Officers' Certificate, stating that each of the conditions in clauses
         (i) through (v) above and the condition set forth in the second
         succeeding sentence have been satisfied and, in the case of such
         Opinion of Counsel, stating that the condition in clause (iv) above has
         been satisfied. Such Officers' Certificate shall also set forth the
         number of shares of Common Stock to be issued for each $1,000 principal
         amount of Debentures and the Last Reported Sale Price of the Common
         Stock on each Trading Day during the period during which the Market
         Price with respect to such Repurchase Date is to be calculated.

         If the foregoing conditions are not satisfied with respect to a holder
or holders prior to the close of business on the Business Day immediately
preceding the Repurchase Date, the Company shall pay the entire Repurchase Price
of the Debentures of such holder or holders in cash.

         Upon determination of the actual number of shares of Common Stock to be
issued upon repurchase of Debentures, the Company shall be required to
disseminate a press release through Dow Jones & Company, Inc. or Bloomberg
Business News containing this information or publish the information on the
Company's web site or through such other public medium as the Company may use at
that time.

         (f)      All shares of Common Stock delivered upon purchase of the
Debentures shall be newly issued shares or treasury shares, shall be duly
authorized, validly issued, fully paid and nonassessable, and shall be free from
preemptive rights and free of any lien or adverse claim.

         (g)      If a holder is paid some or all of the Repurchase Price with
respect to such holder's Debentures in shares of Common Stock, the Company shall
pay any documentary, stamp or similar issue or transfer tax due on such issue of
Common Stock; provided that the holder shall pay any such tax which is due
because the holder requests the Common Stock to be issued in a name other than
that of the holder. The Paying Agent may refuse to deliver the certificates
representing the shares of Common Stock being issued in a name other than the
holder's name until the Paying Agent receives a sum sufficient to pay any tax
which will be due because the shares of Common Stock are to be issued in a name
other than the holder's name. Nothing herein shall preclude any income tax
withholding required by law or regulations.

         Section 3.08. Conditions and Procedures for Repurchase at Option of
Holders. (a) The Company shall repurchase from the holder thereof, pursuant to
Section 3.05 or Section 3.06, a portion of a Debenture, if the principal amount
of such portion is $1,000 or a whole multiple of $1,000. Provisions of this
Indenture that apply to the repurchase of all of a Debenture also apply to the
repurchase of such portion of such Debenture. Upon presentation of any Debenture
repurchased in part only, the Company shall execute and the Trustee shall
authenticate and make

                                       34

<PAGE>

available for delivery to the holder thereof, at the expense of the Company, a
new Debenture or Debentures, of any authorized denomination, in aggregate
principal amount equal to the portion of the Debentures presented that is not
repurchased.

         (b)      On or prior to a Repurchase Date, the Company will deposit
with the Trustee or with one or more Paying Agents (or, if the Company is acting
as its own Paying Agent, set aside, segregate and hold in trust as provided in
Section 5.04) an amount of cash and/or shares of Common Stock, as applicable,
sufficient to repurchase on the Repurchase Date all the Debentures or portions
thereof to be repurchased on such date at the Repurchase Price; provided that if
such deposit is made on the Repurchase Date, it must be received by the Trustee
or Paying Agent, as the case may be, by 10:00 a.m., New York City time, on such
date.

         If the Trustee or other Paying Agent appointed by the Company, or the
Company or an Affiliate of the Company, if it or such Affiliate is acting as the
Paying Agent, holds cash or shares of Common Stock sufficient to pay the
aggregate Repurchase Price of all the Debentures or portions thereof that are to
be repurchased as of the Repurchase Date, on or after the Repurchase Date, (i)
such Debentures will cease to be outstanding, (ii) interest on such Debentures
will cease to accrue and (iii) all other rights of the holders of such
Debentures will terminate, whether or not book-entry transfer of the Debentures
has been made or the Debentures have been delivered to the Trustee or Paying
Agent, other than the right to receive the Repurchase Price upon delivery of the
Debentures.

         (c)      Upon receipt by the Trustee (or other Paying Agent appointed
by the Company) of a Repurchase Election, the holder of the Debenture in respect
of which such Repurchase Election was given shall (unless such notice is validly
withdrawn) thereafter be entitled to receive solely the Repurchase Price with
respect to such Debenture. Such Repurchase Price shall be paid to such holder,
subject to receipt of funds and/or Debentures by the Trustee (or other Paying
Agent appointed by the Company), promptly (but in no event more than five (5)
Business Days) following the later of (x) the Repurchase Date with respect to
such Debenture (provided the holder has satisfied the conditions in Section
3.05(c) or Section 3.06(c), as applicable) and (y) the time of delivery of such
Debenture to the Trustee (or other Paying Agent appointed by the Company) by the
holder thereof in the manner required by Section 3.05(c) or Section 3.06(c), as
applicable. Debentures in respect of which a Repurchase Election has been given
by the holder thereof may not be converted pursuant to Article 15 hereof on or
after the date of the delivery of such Repurchase Election unless such notice
has first been validly withdrawn.

         (d)      Notwithstanding anything herein to the contrary, any holder
delivering to the office of the Trustee (or other Paying Agent appointed by the
Company) a Repurchase Election shall have the right to withdraw such election at
any time prior to the close of business on the Business Day preceding the
Repurchase Date (or any such later time as may be required by applicable law) by
delivery of a written notice of withdrawal to the Trustee (or other Paying Agent
appointed by the Company) specifying:

                  (i)      the certificate number, if any, of the Debenture in
         respect of which such notice of withdrawal is being submitted, or the
         appropriate Depositary information if the Debenture in respect of which
         such notice of withdrawal is being submitted is represented by a Global
         Debenture,

                                       35

<PAGE>

                  (ii)     the principal amount of the Debenture with respect to
         which such notice of withdrawal is being submitted, and

                  (iii)    the principal amount, if any, of such Debenture which
         remains subject to the original Repurchase Election and which has been
         or will be delivered for repurchase by the Company.

         The Trustee (or other Paying Agent appointed by the Company) shall
promptly notify the Company of the receipt by it of any Repurchase Election or
written notice of withdrawal thereof.

         (e)      The Company will comply with the provisions of Rule 13e-4 and
any other tender offer rules under the Exchange Act to the extent then
applicable in connection with the repurchase rights of the holders of Debentures
in the event of a Fundamental Change or on any Company Repurchase Date. If then
required by applicable law, the Company will file a Schedule TO or any other
schedule required in connection with such repurchase.

         (f)      There shall be no repurchase of any Debentures pursuant to
Section 3.05 or Section 3.06 if there has occurred at any time prior to, and is
continuing on, the Repurchase Date an Event of Default (other than an Event of
Default that is cured by the payment of the Repurchase Price with respect to
such Debentures). The Paying Agent will promptly return to the respective
holders thereof any Debentures (x) with respect to which a Repurchase Election
has been withdrawn in compliance with this Indenture or (y) held by it during
the continuance of an Event of Default (other than a default in the payment of
the Repurchase Price with respect to such Debentures) in which case, upon such
return, the Repurchase Election with respect thereto shall be deemed to have
been withdrawn.

         (g)      The Trustee (or other Paying Agent appointed by the Company)
shall return to the Company any cash that remains unclaimed as provided in
Section 13.03, for the payment of the Repurchase Price; provided that, to the
extent that the aggregate amount of cash deposited by the Company pursuant to
Section 3.08(b) exceeds the aggregate Repurchase Price of the Debentures or
portions thereof which the Company is obligated to purchase as of the Repurchase
Date, then, unless otherwise agreed in writing with the Company, promptly after
the Business Day following the Repurchase Date, the Trustee shall return any
such excess to the Company.

         (h)      In the case of a reclassification, change, consolidation,
merger, combination, sale or conveyance to which Section 15.06 applies, in which
the Common Stock of the Company is changed or exchanged as a result into the
right to receive stock, securities or other property or assets (including cash),
which includes shares of Common Stock of the Company or shares of common stock
of another Person that are, or upon issuance will be, traded on a United States
national securities exchange or approved for trading on an established automated
over-the-counter trading market in the United States and such shares constitute
at the time such change or exchange becomes effective in excess of 50% of the
aggregate fair market value of such stock, securities or other property or
assets (including cash) (as determined by the Company, which determination shall
be conclusive and binding), then the Person formed by such consolidation or
resulting from such merger or which acquires such assets, as the case may be,
shall execute and deliver to the Trustee a supplemental indenture (accompanied
by an Opinion of Counsel that such supplemental indenture complies with the
Trust Indenture Act as in force at

                                       36

<PAGE>

the date of execution of such supplemental indenture) modifying the provisions
of this Indenture relating to the right of holders of the Debentures to cause
the Company to repurchase the Debentures following a Fundamental Change and the
provisions of this Indenture relating to the Company's option to deliver shares
of Common Stock in payment of the Repurchase Price, including, without
limitation, the applicable provisions of this Article 3 and the definitions of
Common Stock and Fundamental Change, as appropriate, as determined in good faith
by the Company (which determination shall be conclusive and binding), to make
such provisions apply to such other Person if different from the Company and the
common stock issued by such Person (in lieu of the Company and the Common Stock
of the Company).

                                   ARTICLE 4
                           SUBORDINATION OF DEBENTURES

         Section 4.01. Agreement to Subordinate. The Company agrees, and each
Debentureholder by accepting a Debenture agrees, that the Indebtedness, interest
and other obligations of any kind evidenced by the Debentures and this Indenture
are subordinated in right of payment, to the extent and in the manner provided
in this Article 4, to the prior payment in full of all Senior Indebtedness
(whether outstanding on the date hereof or hereafter created, incurred, assumed
or Guaranteed), and that the subordination is for the benefit of the holders of
Senior Indebtedness.

         No provisions of this Article Four shall prevent the occurrence of any
Event of Default.

         Section 4.02. Payment Over of Proceeds Upon Dissolution, Etc. In the
event of:

         (a)      any insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, reorganization or other similar case or proceeding in
connection therewith, relating to the Company or to its creditors, as such, or
to its assets, or

         (b)      any liquidation, dissolution or other winding up of the
Company, whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy, or

         (c)      any assignment for the benefit of creditors or any other
marshalling of assets and liabilities of the Company,

         then and in any such event specified in (a), (b) or (c) above (each
such event, if any, herein sometimes referred to as a ("PROCEEDING") the holders
of Senior Indebtedness of the Company shall be entitled to receive payment in
full of all amounts due or to become due on or in respect of all Senior
Indebtedness of the Company, or provision shall be made for such payment in cash
or cash equivalents or otherwise in manner satisfactory to the holders of Senior
Indebtedness of the Company, before the Debentureholders are entitled to receive
any payment or distribution of any kind or character, whether in cash, property
or securities (including any payment or distribution which may be payable or
deliverable by reason of the payment of any other Indebtedness of the Company
subordinated to the payment of the Debentures), on account of principal or (or
premium, if any) or interest on the Debentures or on account of any purchase or
other acquisition of Debentures by the Company or any subsidiary of the Company,
(all such payments, distributions, purchases and acquisitions, other than the
payment or distribution of stock or securities of the Company referred to in the
second succeeding paragraph, herein

                                       37

<PAGE>

referred to, individually and collectively, as a "SECURITIES PAYMENT"), and to
that end of the holders of Senior Indebtedness of the Company shall be entitled
to receive, for application to the payment thereof, any Securities Payment which
may be payable or deliverable in respect of the Debentures in any such
Proceeding.

         In the event that, notwithstanding the foregoing provisions of this
Section, the Trustee or the Debentureholder shall have received any Securities
Payment before all Senior Indebtedness of the Company is paid in full or payment
thereof provided for in cash or cash equivalents or otherwise in a manner
satisfactory to the holders of Senior Indebtedness of the Company, then and in
such event such Securities Payment shall be paid over or delivered forthwith to
the trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee
agent or other Person making payment or distribution of assets of the Company
for application to the payment of all Senior Indebtedness of the Company
remaining unpaid, to the extent necessary to pay all Senior Indebtedness of the
Company in full, after giving effect to any concurrent payment or distribution
to or for the holders of Senior Indebtedness of the Company.

         For purposes of this Article only, the words "any payment or
distribution of any kind or character, whether in cash, property or securities"
shall not be deemed to include a payment or distribution of stock or securities
of the Company provided for by a plan or reorganization or readjustment
authorized by an order or decree of a court of competent jurisdiction in a
reorganization proceeding under any applicable Bankruptcy Law or of any other
corporation provided for by such plan of reorganization or readjustment which
stock or securities are subordinated in right of payment to all then outstanding
Senior Indebtedness of the Company to substantially the same extent as the
Debentures are so subordinated as provided in this Article. The consolidation of
the Company with, or the merger of the Company into, another Person or the
liquidation or dissolution of the Company following the conveyance or transfer
of all or substantially all of its properties and assets as an entirety to
another Person upon the terms and conditions set forth in Article Twelve shall
not be deemed a Proceeding for the purposes of this Section if the Person formed
by such consolidation or into which the Company is merged or the Person which
acquires by conveyance or transfer such properties and assets as an entirety, as
the case may be, shall, as a part of such consolidation, merger, conveyance or
transfer, comply with the conditions set forth in Article Twelve.

         Section 4.03. No Payment When Senior Indebtedness of the Company in
Default. In the event that any Payment Default (as defined below) shall have
occurred and be continuing, then no Securities Payment shall be made unless and
until such Payment Default shall have been cured or waived or shall have ceased
to exist, or all amounts then due and payable in respect of Senior Indebtedness
of the Company shall have been paid in full, or provision shall have been made
for such payment in cash or cash equivalents or otherwise in a manner
satisfactory to the holders of Senior Indebtedness of the Company.

                  "PAYMENT DEFAULT" means any default in the payment of
principal of (or premium, if any) or interest on any Senior Indebtedness of the
Company when due, whether at the stated maturity of any such payment or by
declaration of acceleration, call for redemption or otherwise.

                                       38

<PAGE>

                  In the event that any Senior Nonmonetary Default (as defined
below) shall have occurred and be continuing, then, upon the receipt by the
Company and the Trustee of written notice of such Senior Nonmonetary Default
from any holder, or agent for the holders, of the Designated Senior Indebtedness
which is the subject of such Senior Nonmonetary Default, no Securities Payment
shall be made during the period (the "PAYMENT BLOCKAGE PERIOD") commencing on
the date of such receipt of such written notice and ending on the earlier of (i)
the date on which such Senior Nonmonetary Default shall have been cured or
waived or shall have ceased to exist or all Designated Senior Indebtedness that
is the subject of such Senior Nonmonetary Default shall have been discharged;
(ii) the 180th day after the date of such receipt of such written notice; and
(iii) the date on which the Payment Blockage Period shall have been terminated
by written notice to the Company or the Trustee from the agent for the
Designated Senior Indebtedness initiating the Payment Blockage Period. No more
than one Payment Blockage Period may be commenced with respect to the Debentures
during any 360-day period and there shall be a period of at least 181
consecutive days in each 360-day period when no Payment Blockage Period is in
effect. For all purposes of this paragraph, no Payment Default or Senior
Nonmonetary Default that existed or was continuing on the date of commencement
of any Payment Blockage Period shall be, or be made, the basis for the
commencement of a subsequent Payment Blockage Period, whether or not within a
period of 360 consecutive days, unless such Payment Default or Senior
Nonmonetary Default shall have been cured for a period of not less than 90
consecutive days.

                  "SENIOR NONMONETARY DEFAULT" means the occurrence or existence
and continuance of any event of default with respect to any Designated Senior
Indebtedness, other than a Payment Default, permitting the holders of such
Designated Senior Indebtedness to declare such Designated Senior Indebtedness
due and payable prior to the date on which it would otherwise become due and
payable.

                  In the event that, notwithstanding the foregoing, the Company
shall make any Securities Payment to the Trustee or any Debentureholder
prohibited by the foregoing provisions of this Section, then and in such event
such Securities Payment shall be paid over and delivered forthwith to the
holders of Senior Indebtedness to the extent necessary to make payment in full
to the holders of all unpaid Senior Indebtedness.

                  The provisions of this Section shall not apply to any
Securities Payment with respect to which Section 4.02 would be applicable..

         Section 4.04. Payment Permitted If No Default. Nothing contained in
this Article or elsewhere in this Indenture or in any of the Debentures shall
prevent (a) the Company from making Securities Payments, or (b) the application
by the Trustee of any money deposited with it hereunder to Securities Payments
or the retention of such Securities Payment by the Debentureholders, at any time
except during the pendency of any Proceeding referred to in Section 4.02 or
under the conditions described in Section 4.03, provided that the Trustee shall
have no liability for any such application if it did not have knowledge that
such Securities Payment was prohibited by the provisions of this Article.

         Section 4.05. Subrogation to Rights of Holders of Designated Senior
Indebtedness of the Company. Upon (but not before) the payment in full of all
Designated Senior Indebtedness, the

                                       39

<PAGE>

holders of the Debentures shall (to the extent that amounts otherwise payable to
such holders have been paid to the holders of Designated Senior Indebtedness
pursuant to this Article 4) be subrogated to the rights of any holder of
Designated Senior Indebtedness to receive any further payments or distributions
applicable to the Designated Senior Indebtedness until the Debentures are paid
in full; and such payments or distributions received by the holders of the
Debentures by reason of such subrogation, which otherwise would be paid or
distributed to the holders of Designated Senior Indebtedness, shall, as between
the Company and its creditors other than the holders of Designated Senior
Indebtedness, on the one hand, and the holders of Debentures, on the other hand,
be deemed to be a payment by the Company on account of Designated Senior
Indebtedness and not on account of the Debentures.

         Section 4.06. Provisions Solely to Define Relative Rights. The
provisions of this Article are and are intended solely for the purpose of
defining the relative rights of the Debentureholders on the one hand and the
holders of Senior Indebtedness of the Company on the other hand. Nothing
contained in this Article or elsewhere in this Indenture or in the Debentures is
intended to or shall (a) impair, as among the Company, its creditors other than
holders of Senior Indebtedness of the Company and the Debentureholders, the
obligation of the Company, which is absolute and unconditional (and which,
subject to the rights under this Article of the holders of Senior Indebtedness
of the Company, is intended to rank equally with all other general obligations
of the Company), to pay to the Debentureholders the principal of (and premium,
if any) and interest on the Debentures as and when the same shall become due and
payable in accordance with their terms; or (b) affect the relative rights
against the Company of the Debentureholders and creditors of the Company other
than the holders of Senior Indebtedness of the Company; or (c) prevent the
Trustee or the Debentureholder from exercising all remedies otherwise permitted
by applicable law upon default under this Indenture, subject to the rights, if
any, under this Article of the holders of Senior Indebtedness of the Company to
receive cash, property and securities otherwise payable or deliverable to the
Trustee or such Debentureholder.

         Section 4.07. Trustee to Effectuate Subordination. Each Debentureholder
by his acceptance thereof authorizes and directs the Trustee on his behalf to
take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article and appoints the Trustee his
attorney-in-fact for any and all such purposes.

         Section 4.08. No Waiver of Subordination Provisions. No right of any
present or future holder of any Senior Indebtedness of the Company to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance by
the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.

         Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Indebtedness of the Company may, at any time and from time
to time, without the consent of or notice to the Trustee or the
Debentureholders, without incurring responsibility to the Debentureholders and
without impairing or releasing the subordination provided in this Article or the
obligations hereunder of the Debentureholders to the holders of Senior
Indebtedness of the Company, do any one or more of the following: (i) change the
manner, place or terms of payment or extend the time of payment of, or renew or
alter, Senior Indebtedness of the

                                       40

<PAGE>

Company, or otherwise amend or supplement in any manner Senior Indebtedness of
the Company or any instrument evidencing the same or any agreement under which
Senior Indebtedness of the Company is outstanding; (ii) sell, exchange, release
or otherwise deal with any property pledged, mortgaged or otherwise securing
Senior Indebtedness of the Company; (iii) release any Person liable in any
manner for the collection of Senior Indebtedness of the Company; and (iv)
exercise or refrain from exercising any rights against the Company and any other
Person.

         Section 4.09. Notice to Trustee. The Company shall give prompt written
notice to the Trustee of any fact known to the Company which would prohibit the
making of any payment to or by the Trustee in respect of the Debentures;
provided, however, that failure to provide such notice shall not affect the
subordination of the Debentures provided for herein. Notwithstanding the
provisions of this Article or any other provision of this Indenture, the Trustee
shall not be charged with knowledge of the existence of any facts which would
prohibit the making of any payment to or by the Trustee in respect of the
Debentures, unless and until the Trustee shall have received written notice
thereof from the Company or a holder of Senior Indebtedness of the Company or
from any trustee therefor; and, prior to the receipt of any such written notice,
the Trustee, subject to the provisions of Section 8.01, shall be entitled in all
respects to assume that no such facts exist; provided, however, that if the
Trustee shall not have received the notice provided for in this Section at least
three Business Days prior to the date upon which by the terms hereof any money
may become payable for any purpose (including, without limitation, the payment
of the principal of (and premium, if any) or interest on any Debenture), then,
anything herein contained to the contrary notwithstanding, the Trustee shall
have full power and authority to receive such money and to apply the same to the
purpose for which such money was received and shall not be affected by any
notice to the contrary which may be received by it within three Business Days
prior to such date.

                  Subject to the provisions of Section 8.01, the Trustee shall
be entitled to rely on the delivery to it of a written notice by a Person
representing himself to be a holder of Senior Indebtedness of the Company (or a
trustee or other representative therefor) to establish that such notice has been
given by a holder of Senior Indebtedness of the Company (or a trustee therefor).
In the event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness of the Company to participate in any payment or distribution
pursuant to this Article, the Trustee may request such person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Senior Indebtedness of the Company held by such Person, the extent to which such
Person is entitled to participate in such payment or distribution and any other
facts pertinent to the rights of such Person under this Article, and if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.

         Section 4.10. Reliance on Judicial Order or Certificate of Liquidating
Agent. Upon any payment or distribution of assets of the Company referred to in
this Article, the Trustee, subject to the provisions of Section 8.01, and the
Debentureholders shall be entitled to rely upon any order or decree entered by
any court of competent jurisdiction in which such proceeding is pending, or a
certificate of the trustee in bankruptcy, receiver, liquidating trustee,
custodian, assignee for the benefit of creditors, agent or other Person making
such payment or distribution,

                                       41

<PAGE>

delivered to the Trustee or to the Debentureholders, for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Indebtedness of the Company and other
indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article.

         Section 4.11. Trustee Not Fiduciary for Holders of Senior Indebtedness
of the Company. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness of the Company and shall not be liable to any
such holders if it shall in good faith mistakenly pay over or distribute to
Debentureholders or to the Company, or to any other Person cash, property or
securities to which any holders of Senior Indebtedness of the Company shall be
entitled by virtue of this Article or otherwise.

         Section 4.12. Rights of Trustee as Holder of Senior Indebtedness of the
Company; Preservation of Trustee's Rights. The Trustee in its individual
capacity shall be entitled to all the rights set forth in this Article with
respect to any Senior Indebtedness of the Company which may at any time be held
by it, to the same extent as any other holder of Senior Indebtedness of the
Company, and nothing in this Indenture shall deprive the Trustee of any of its
rights as such holder.

         Nothing in this Article shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 8.06.

         Section 4.13. Article Applicable to Paying Agents. In case at any time
Paying Agent other than the Trustee shall have been appointed by the Company and
be then acting hereunder, the term "Trustee" as used in this Article shall in
such case (unless the context otherwise requires) be construed as extending to
and including such Paying Agent within its meaning as fully for all intents and
purposes as if such Paying Agent were named in this Article in addition to or in
place of the Trustee; provided, however, that Section 4.14 shall not apply to
the Company, or any Affiliate of the Company if it or such Affiliate acts as
Paying Agent.

                                   ARTICLE 5
                       PARTICULAR COVENANTS OF THE COMPANY

         Section 5.01. Payment of Principal and Interest. The Company covenants
and agrees that it will duly and punctually pay or cause to be paid the
principal of (including any Redemption Price or Repurchase Price pursuant to
Article 3) and interest on each of the Debentures at the places, at the
respective times and in the manner provided herein and in the Debentures.

         Section 5.02. Maintenance of Office or Agency. The Company will
maintain an office or agency in the Borough of Manhattan, The City of New York,
where the Debentures may be surrendered for registration of transfer or exchange
or for presentation for payment or for conversion, redemption or repurchase and
where notices and demands to or upon the Company in respect of the Debentures
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

                                       42

<PAGE>

agency not designated or appointed by the Trustee. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office.

         The Company may also from time to time designate co-registrars and one
or more offices or agencies where the Debentures may be presented or surrendered
for any or all such purposes and may from time to time rescind such
designations. The Company will give prompt written notice of any such
designation or rescission and of any change in the location of any such other
office or agency.

         The Company hereby initially designates the Trustee as Paying Agent,
Debenture Registrar, Custodian and Conversion Agent, and each of the Corporate
Trust Office and the office or agency of the Trustee in the Borough of Manhattan
shall be considered as one such office or agency of the Company for each of the
aforesaid purposes.

         So long as the Trustee is the Debenture Registrar, the Trustee agrees
to mail, or cause to be mailed, the notices set forth in Section 8.10(a) and the
third paragraph of Section 8.11. If co-registrars have been appointed in
accordance with this Section, the Trustee shall mail such notices only to the
Company and the holders of Debentures it can identify from its records.

         Section 5.03. Appointments to Fill Vacancies in Trustee's Office. The
Company, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint, in the manner provided in Section 8.10, a Trustee, so that there
shall at all times be a Trustee hereunder.

         Section 5.04. Provisions as to Paying Agent. (a) If the Company shall
appoint a Paying Agent other than the Trustee, or if the Trustee shall appoint
such a Paying Agent, the Company will cause such Paying Agent 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 5.04:

                  (1)      that it will hold all sums held by it as such agent
         for the payment of the principal of or interest on the Debentures
         (whether such sums have been paid to it by the Company or by any other
         obligor on the Debentures) in trust for the benefit of the holders of
         the Debentures;

                  (2)      that it will give the Trustee notice of any failure
         by the Company (or by any other obligor on the Debentures) to make any
         payment of the principal of or interest on the Debentures when the same
         shall be due and payable; and

                  (3)      that at any time during the continuance of an Event
         of Default, upon request of the Trustee, it will forthwith pay to the
         Trustee all sums so held in trust.

         The Company shall, on or before each due date of the principal of or
interest on the Debentures, deposit with the Paying Agent a sum (in funds which
are immediately available on the due date for such payment) sufficient to pay
such principal or interest, and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee of any failure to take such action;
provided that if such deposit is made on the due date, such deposit shall be
received by the Paying Agent by 10:00 a.m., New York City time, on such date.

                                       43

<PAGE>

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

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

         (d)      Anything in this Section 5.04 to the contrary notwithstanding,
the agreement to hold sums in trust as provided in this Section 5.04 is subject
to Sections 13.02 and 13.03.

         The Trustee shall not be responsible for the actions of any other
Paying Agents (including the Company if acting as its own Paying Agent) and
shall have no control of any funds held by such other Paying Agents.

         Section 5.05. Existence. Subject to Article 12, the Company will do or
cause to be done all things necessary to preserve and keep in full force and
effect its existence and rights (charter and statutory); provided that the
Company shall not be required to preserve any such right if the Company shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and that the loss thereof is not disadvantageous in
any material respect to the Debentureholders.

         Section 5.06. Rule 144A Information Requirement. Within the period
prior to the expiration of the holding period applicable to sales thereof under
Rule 144(k) under the Securities Act (or any successor provision), the Company
covenants and agrees that it shall, during any period in which it is not subject
to Section 13 or 15(d) under the Exchange Act, make available to any holder or
beneficial holder of Debentures or any Common Stock issued upon conversion
thereof which continue to be Restricted Securities in connection with any sale
thereof and any prospective purchaser of Debentures or such Common Stock
designated by such holder or beneficial holder, the information required
pursuant to Rule 144A(d)(4) under the Securities Act upon the request of any
holder or beneficial holder of the Debentures or such Common Stock and it will
take such further action as any holder or beneficial holder of such Debentures
or such Common Stock may reasonably request, all to the extent required from
time to time to enable such holder or beneficial holder to sell its Debentures
or Common Stock without registration under the Securities Act within the
limitation of the exemption provided by Rule 144A, as such Rule may be amended
from time to time. Upon the request of any holder or any beneficial holder of
the Debentures or such Common Stock, the Company will deliver to such holder a
written statement as to whether it has complied with such requirements.

                                       44

<PAGE>

         Section 5.07. Stay, Extension and Usury Laws. The Company covenants (to
the extent that it may lawfully do so) that it shall not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law or other law which would prohibit or
forgive the Company from paying all or any portion of the principal of or
interest on the Debentures as contemplated herein, wherever enacted, now or at
any time hereafter in force, or which may affect the covenants or the
performance of this Indenture and the Company (to the extent it may lawfully do
so) hereby expressly waives all benefit or advantage of any such law, and
covenants that it will not, by resort to any such law, hinder, delay or impede
the execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law had been enacted.

         Section 5.08. Compliance Certificate. The Company shall deliver to the
Trustee, within one hundred twenty (120) days after the end of each fiscal year
of the Company (which fiscal year of the Company is presently the 12 calendar
months ending December 31), a certificate signed by either the principal
executive officer, principal financial officer or principal accounting officer
of the Company, stating whether or not to the best knowledge of the signer
thereof the Company is in default in the performance and observance of any of
the terms, provisions and conditions of this Indenture (without regard to any
period of grace or requirement of notice provided hereunder) and, if the Company
shall be in default, specifying all such defaults and the nature and the status
thereof of which the signer may have knowledge.

         The Company will deliver to the Trustee, promptly upon becoming aware
of (i) any default in the performance or observance of any covenant, agreement
or condition contained in this Indenture, or (ii) any Event of Default, an
Officers' Certificate specifying with particularity such default or Event of
Default and further stating what action the Company has taken, is taking or
proposes to take with respect thereto.

         Any notice required to be given under this Section 5.08 shall be
delivered to a Responsible Officer of the Trustee at its Corporate Trust Office.

         Section 5.09. Additional Amounts Notice. In the event that the Company
is required to pay Additional Amounts to holders of Debentures pursuant to the
Registration Rights Agreement, the Company will provide written notice
("ADDITIONAL AMOUNTS NOTICE") to the Trustee of its obligation to pay Additional
Amounts no later than fifteen (15) days prior to the proposed payment date for
the Additional Amounts, and the Additional Amounts Notice shall set forth the
amount of Additional Amounts to be paid by the Company on such payment date. The
Trustee shall not at any time be under any duty or responsibility to any holder
of Debentures to determine the Additional Amounts, or with respect to the
nature, extent or calculation of the amount of Additional Amounts when made, or
with respect to the method employed in such calculation of the Additional
Amounts.

                                   ARTICLE 6
       DEBENTUREHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE

         Section 6.01. Debentureholders' Lists. The Company covenants and agrees
that it will furnish or cause to be furnished to the Trustee, semiannually, not
more than fifteen (15) days after each March 15 and September 15 in each year
beginning with March 15, 2004, and at such

                                       45

<PAGE>

other times as the Trustee may request in writing, within thirty (30) days after
receipt by the Company of any such request (or such lesser time as the Trustee
may reasonably request in order to enable it to timely provide any notice to be
provided by it hereunder), a list in such form as the Trustee may reasonably
require of the names and addresses of the holders of Debentures as of a date not
more than fifteen (15) days (or such other date as the Trustee may reasonably
request in order to so provide any such notices) prior to the time such
information is furnished, except that no such list need be furnished by the
Company to the Trustee so long as the Trustee is acting as the sole Debenture
Registrar.

         Section 6.02. Preservation and Disclosure of Lists. (a) The Trustee
shall preserve, in as current a form as is reasonably practicable, all
information as to the names and addresses of the holders of Debentures contained
in the most recent list furnished to it as provided in Section 6.01 or
maintained by the Trustee in its capacity as Debenture Registrar or co-registrar
in respect of the Debentures, if so acting. The Trustee may destroy any list
furnished to it as provided in Section 6.01 upon receipt of a new list so
furnished.

         (b)      The rights of Debentureholders to communicate with other
holders of Debentures with respect to their rights under this Indenture or under
the Debentures, and the corresponding rights and duties of the Trustee, shall be
as provided by the Trust Indenture Act.

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

         Section 6.03. Reports by Trustee. (a) Within sixty (60) days after
December 15 of each year commencing with the year 2003, the Trustee shall
transmit to holders of Debentures such reports dated as of December 15 of the
year in which such reports are made concerning the Trustee and its actions under
this Indenture as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant thereto. In the event that no events
have occurred under the applicable sections of the Trust Indenture Act, the
Trustee shall be under no duty or obligation to provide such reports.

         (b)      A copy of such report shall, at the time of such transmission
to holders of Debentures, be filed by the Trustee with each stock exchange and
automated quotation system upon which the Debentures are listed and with the
Company. The Company will promptly notify the Trustee in writing when the
Debentures are listed on any stock exchange or automated quotation system or
delisted therefrom.

         Section 6.04. Reports by the Company. The Company shall file with the
Trustee (and the Commission if at any time after the Indenture becomes qualified
under the Trust Indenture Act), and transmit to holders of Debentures, such
information, documents and other reports and such summaries thereof, as may be
required pursuant to the Trust Indenture Act at the times and in the manner
provided pursuant to such Act, whether or not the Debentures are governed by
such Act; provided that any such information, documents or reports required to
be filed with the Commission pursuant to Section 13 or 15(d) of the Exchange Act
shall be filed with the Trustee within fifteen (15) days after the same is so
required to be filed with the Commission. Delivery

                                       46

<PAGE>

of such reports, information and documents to the Trustee is for informational
purposes only and the Trustee's receipt of such shall not constitute
constructive notice of any information contained therein or determinable from
information contained therein, including the Company's compliance with any of
its covenants hereunder (as to which the Trustee is entitled to rely exclusively
on Officers' Certificates).

                                   ARTICLE 7
       REMEDIES OF THE TRUSTEE AND DEBENTUREHOLDERS ON AN EVENT OF DEFAULT

         Section 7.01. Events of Default. In case one or more of the following
events (each, an "EVENT OF DEFAULT") (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body) shall
have occurred and be continuing:

                  (a)      default in the payment of any installment of interest
         upon any of the Debentures as and when the same shall become due and
         payable, and continuance of such default for a period of thirty (30)
         days whether or not such payment is prohibited by Article 4; or

                  (b)      default in the payment of the principal of any of the
         Debentures as and when the same shall become due and payable either at
         maturity or in connection with any redemption or repurchase, in each
         case pursuant to Article 3, by acceleration or otherwise whether or not
         such payment is prohibited by Article 4; or

                  (c)      default in the Company's obligation to convert the
         Debentures upon the exercise of a holder's rights pursuant to Article
         15; or

                  (d)      default in the Company's obligation to repurchase the
         Debentures at the option of a holder upon a Fundamental Change pursuant
         to Section 3.05 or on specified dates pursuant to Section 3.06; or

                  (e)      failure to provide notice of the occurrence of a
         Fundamental Change on a timely basis as required by Section 3.05; or

                  (f)      default in the Company's obligation to redeem the
         Debentures after it has exercised its option to redeem; or

                  (g)      failure on the part of the Company duly to observe or
         perform any other of the covenants or agreements on the part of the
         Company in the Debentures or in this Indenture (other than a covenant
         or agreement a default in whose performance or whose breach is
         elsewhere in this Section 7.01 specifically dealt with) continued for a
         period of sixty (60) days after the date on which written notice of
         such failure, requiring the Company to remedy the same, shall have been
         given to the Company by the Trustee, or to the Company and a
         Responsible Officer of the Trustee by the holders of at least 25% in
         aggregate principal amount of the Debentures at the time outstanding
         determined in accordance with Section 9.04; or

                                       47

<PAGE>

                  (h)      default by the Company or any of its subsidiaries in
         the payment of the principal or interest on any mortgage, agreement or
         other instrument under which there may be outstanding, or by which
         there may be secured or evidenced, any of the indebtedness of the
         Company or any of its subsidiaries for money borrowed in excess of
         $10,000,000 in the aggregate, whether such indebtedness now exists or
         shall hereafter be created, resulting in such indebtedness becoming or
         being declared due and payable, and such acceleration shall not have
         been rescinded or annulled within thirty (30) days after written notice
         of such acceleration has been received by the Company or such
         subsidiary; or

                  (i)      final unsatisfied judgments not covered by insurance
         aggregating in excess of $10,000,000 rendered against the Company or
         any of its subsidiaries and not stayed, bonded or discharged within a
         period of sixty (60) consecutive days; or

                  (j)      the Company shall commence a voluntary case or other
         proceeding seeking liquidation, reorganization or other relief with
         respect to the Company or its debts under any bankruptcy, insolvency or
         other similar law now or hereafter in effect or seeking the appointment
         of a trustee, receiver, liquidator, custodian or other similar official
         of the Company or any substantial part of the property of the Company,
         or shall consent to any such relief or to the appointment of or taking
         possession by any such official in an involuntary case or other
         proceeding commenced against the Company, or shall make a general
         assignment for the benefit of creditors, or shall fail generally to pay
         its debts as they become due; or

                  (k)      an involuntary case or other proceeding shall be
         commenced against the Company seeking liquidation, reorganization or
         other relief with respect to the Company or its debts under any
         bankruptcy, insolvency or other similar law now or hereafter in effect
         or seeking the appointment of a trustee, receiver, liquidator,
         custodian or other similar official of the Company or any substantial
         part of the property of the Company, and such involuntary case or other
         proceeding remains undismissed or unstayed and in effect for a period
         of sixty (60) consecutive days;

then, and in each and every such case (other than an Event of Default specified
in Section 7.01(j) or 7.01(k)), unless the principal of all of the Debentures
shall have already become due and payable, either the Trustee or the holders of
not less than 25% in aggregate principal amount of the Debentures then
outstanding hereunder determined in accordance with Section 9.04, by notice in
writing to the Company (and to the Trustee if given by Debentureholders), may
declare the principal of all the Debentures and the interest accrued thereon to
be due and payable immediately, and upon any such declaration the same shall
become and shall be immediately due and payable, anything in this Indenture or
in the Debentures contained to the contrary notwithstanding. If an Event of
Default specified in Section 7.01(j) or 7.01(k) occurs, the principal of all the
Debentures and the interest accrued thereon shall be immediately and
automatically due and payable without necessity of further action. This
provision, however, is subject to the conditions that if, at any time after the
principal of the Debentures shall have been so declared due and payable, and
before any judgment or decree for the payment of the monies due shall have been
obtained or entered as hereinafter provided, the Company shall pay or shall
deposit with the Trustee a sum sufficient to pay all matured installments of
interest upon all

                                       48

<PAGE>

Debentures and the principal of any and all Debentures which shall have become
due otherwise than by acceleration (with interest on overdue installments of
interest (to the extent that payment of such interest is enforceable under
applicable law) and on such principal at the rate borne by the Debentures, to
the date of such payment or deposit) and amounts due to the Trustee pursuant to
Section 8.06, and if any and all defaults under this Indenture, other than the
nonpayment of principal of and accrued interest on Debentures which shall have
become due by acceleration, shall have been cured or waived pursuant to Section
7.07, then and in every such case the holders of a majority in aggregate
principal amount of the Debentures then outstanding, by written notice to the
Company and to the Trustee, may waive all defaults or Events of Default and
rescind and annul such declaration and its consequences; but no such waiver or
rescission and annulment shall extend to or shall affect any subsequent default
or Event of Default, or shall impair any right consequent thereon. The Company
shall notify in writing a Responsible Officer of the Trustee, promptly upon
becoming aware thereof, of any Event of Default.

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

         Section 7.02. Payments of Debentures on Default; Suit Therefor. The
Company covenants that (a) in case default shall be made in the payment of any
installment of interest upon any of the Debentures as and when the same shall
become due and payable, and such default shall have continued for a period of
thirty (30) days, or (b) in case default shall be made in the payment of the
principal of any of the Debentures as and when the same shall have become due
and payable, whether at maturity of the Debentures or in connection with any
redemption, repurchase, acceleration, declaration or otherwise, then, upon
demand of the Trustee, the Company will pay to the Trustee, for the benefit of
the holders of the Debentures, the whole amount that then shall have become due
and payable on all such Debentures for principal or interest, as the case may
be, with interest upon the overdue principal and (to the extent that payment of
such interest is enforceable under applicable law) upon the overdue installments
of interest at the rate borne by the Debentures, and, in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses of
collection, including reasonable compensation to the Trustee, its agents,
attorneys and counsel, and all other amounts due the Trustee under Section 8.06.
Until such demand by the Trustee, the Company may pay the principal of and
interest on the Debentures to the registered holders, whether or not the
Debentures are overdue.

         In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any actions or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor on the
Debentures and collect in the manner provided by law out of the property of the
Company or any other obligor on the Debentures wherever situated the monies
adjudged or decreed to be payable.

                                       49

<PAGE>

         In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor on the Debentures under
Title 11 of the United States Code, or any other applicable law, or in case a
receiver, assignee or trustee in bankruptcy or reorganization, liquidator,
sequestrator or similar official shall have been appointed for or taken
possession of the Company or such other obligor, the property of the Company or
such other obligor, or in the case of any other judicial proceedings relative to
the Company or such other obligor upon the Debentures, or to the creditors or
property of the Company or such other obligor, the Trustee, irrespective of
whether the principal of the Debentures shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand pursuant to the provisions of this Section 7.02,
shall be entitled and empowered, by intervention in such proceedings or
otherwise, to file and prove a claim or claims for the whole amount of principal
and interest owing and unpaid in respect of the Debentures, and, in case of any
judicial proceedings, to file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee and
of the Debentureholders allowed in such judicial proceedings relative to the
Company or any other obligor on the Debentures, its or their creditors, or its
or their property, and to collect and receive any monies or other property
payable or deliverable on any such claims, and to distribute the same after the
deduction of any amounts due the Trustee under Section 8.06, and to take any
other action with respect to such claims, including participating as a member of
any official committee of creditors, as it reasonably deems necessary or
advisable, and, unless prohibited by law or applicable regulations, and any
receiver, assignee or trustee in bankruptcy or reorganization, liquidator,
custodian or similar official is hereby authorized by each of the
Debentureholders to make such payments to the Trustee, and, in the event that
the Trustee shall consent to the making of such payments directly to the
Debentureholders, to pay to the Trustee any amount due it for reasonable
compensation, expenses, advances and disbursements, including counsel fees and
expenses incurred by it up to the date of such distribution. To the extent that
such payment of reasonable compensation, expenses, advances and disbursements
out of the estate in any such proceedings shall be denied for any reason,
payment of the same shall be secured by a Lien on, and shall be paid out of, any
and all distributions, dividends, monies, securities and other property which
the holders of the Debentures may be entitled to receive in such proceedings,
whether in liquidation or under any plan of reorganization or arrangement or
otherwise.

         All rights of action and of asserting claims under this Indenture, or
under any of the Debentures, may be enforced by the Trustee without the
possession of any of the Debentures, or the production thereof at any trial or
other proceeding relative thereto, and any such suit or proceeding instituted by
the Trustee shall be brought in its own name as trustee of an express trust, and
any recovery of judgment shall, 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
Debentures.

         In any proceedings brought by the Trustee (and in any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party), the Trustee shall be held to represent all the
holders of the Debentures, and it shall not be necessary to make any holders of
the Debentures parties to any such proceedings.

                                       50

<PAGE>

         Section 7.03. Application of Monies Collected by Trustee. Any monies
collected by the Trustee pursuant to this Article 7 shall be applied in the
order following, at the date or dates fixed by the Trustee for the distribution
of such monies, upon presentation of the several Debentures, and stamping
thereon 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 8.06;

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

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

                  FOURTH: To the payment of the remainder, if any, to the
         Company or any other Person lawfully entitled thereto.

         Section 7.04. Proceedings by Debentureholder. No holder of any
Debenture shall have any right by virtue of or by reference to any provision of
this Indenture to institute any suit, action or proceeding in equity or at law
upon or under or with respect to this Indenture, or for the appointment of a
receiver, trustee, liquidator, custodian or other similar official, or for any
other remedy hereunder, unless such holder previously shall have given to the
Trustee written notice of an Event of Default and of the continuance thereof, as
hereinbefore provided, and unless also the holders of not less than 25% in
aggregate principal amount of the Debentures then outstanding shall have made
written request upon the Trustee to institute such action, suit or proceeding in
its own name as Trustee hereunder and shall have offered to the Trustee such
reasonable security or indemnity satisfactory to the Trustee as it may require
against the costs, expenses and liabilities to be incurred therein or thereby,
and the Trustee for sixty (60) days after its receipt of such notice, request
and offer of reasonable indemnity, shall have neglected or refused to institute
any such action, suit or proceeding and no direction inconsistent with such
written request shall have been given to the Trustee pursuant to Section 7.07;
it being understood and intended, and being expressly covenanted by the taker
and holder of every Debenture with every other taker and holder and the Trustee,
that no one or more holders of Debentures shall have any right in any manner
whatever by virtue of or by reference to any provision of this Indenture to
affect, disturb

                                       51

<PAGE>

or prejudice the rights of any other holder of Debentures, or to obtain or seek
to obtain priority over or preference to any other such holder, or to enforce
any right under this Indenture, except in the manner herein provided and for the
equal, ratable and common benefit of all holders of Debentures (except as
otherwise provided herein). For the protection and enforcement of this Section
7.04, each and every Debentureholder and the Trustee shall be entitled to such
relief as can be given either at law or in equity.

         Notwithstanding any other provision of this Indenture and any provision
of any Debenture, the right of any holder of any Debenture to receive payment of
the principal of (including any Redemption Price or Repurchase Price pursuant to
Article 3) and accrued interest on such Debenture on or after the respective due
dates expressed in such Debenture, or to institute suit for the enforcement of
any such payment on or after such respective dates against the Company, shall
not be impaired or affected without the consent of such holder.

         Anything in this Indenture or the Debentures to the contrary
notwithstanding, the holder of any Debenture, without the consent of either the
Trustee or the holder of any other Debenture, on its own behalf and for its own
benefit, may enforce, and may institute and maintain any proceeding suitable to
enforce, its rights of conversion as provided herein.

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

         Section 7.06. Remedies Cumulative and Continuing. Except as provided in
Section 2.06, all powers and remedies given by this Article 7 to the Trustee or
to the Debentureholders shall, to the extent permitted by law, be deemed
cumulative and not exclusive of any thereof or of any other powers and remedies
available to the Trustee or the holders of the Debentures, by judicial
proceedings or otherwise, to enforce the performance or observance of the
covenants and agreements contained in this Indenture, and no delay or omission
of the Trustee or of any holder of any of the Debentures to exercise any right
or power accruing upon any default or Event of Default occurring and continuing
as aforesaid shall impair any such right or power, or shall be construed to be a
waiver of any such default or any acquiescence therein, and, subject to the
provisions of Section 7.04, every power and remedy given by this Article 7 or by
law to the Trustee or to the Debentureholders may be exercised from time to
time, and as often as shall be deemed expedient, by the Trustee or by the
Debentureholders.

         Section 7.07. Direction of Proceedings and Waiver of Defaults by
Majority of Debentureholders. The holders of a majority in aggregate principal
amount of the Debentures at the time outstanding determined in accordance with
Section 9.04 shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee; provided that (a) such direction
shall not be in conflict with any rule of law or with this Indenture, (b) the
Trustee may take any other action which is not inconsistent with such direction
and (c) the Trustee may decline to take any

                                       52

<PAGE>

action that would benefit some Debentureholders to the detriment of other
Debentureholders. The holders of a majority in aggregate principal amount of the
Debentures at the time outstanding determined in accordance with Section 9.04
may, on behalf of the holders of all of the Debentures, waive any past default
or Event of Default hereunder and its consequences, except (i) a default in the
payment of interest on, or the principal of, the Debentures, (ii) a failure by
the Company to convert any Debentures into Common Stock, (iii) a default in the
payment of the Redemption Price pursuant to Section 3.03, (iv) a default in the
payment of the Fundamental Change Repurchase Price pursuant to Section 3.05 or
Company Repurchase Price pursuant to Section 3.06 or (v) a default in respect of
a covenant or provisions hereof which under Article 11 cannot be modified or
amended without the consent of the holders of each or all Debentures then
outstanding or affected thereby. Upon any such waiver, the Company, the Trustee
and the holders of the Debentures shall be restored to their former positions
and rights hereunder; but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon. Whenever any
default or Event of Default hereunder shall have been waived as permitted by
this Section 7.07, said default or Event of Default shall for all purposes of
the Debentures and this Indenture be deemed to have been cured and to be not
continuing; but no such waiver shall extend to any subsequent or other default
or Event of Default or impair any right consequent thereon.

         Section 7.08. Notice of Defaults. The Trustee shall, within ninety (90)
days after a Responsible Officer of the Trustee has knowledge of the occurrence
of a default, mail to all Debentureholders, as the names and addresses of such
holders appear upon the Debenture Register, notice of all defaults known to a
Responsible Officer, unless such defaults shall have been cured or waived before
the giving of such notice; provided that except in the case of default in the
payment of the principal of or interest on any of the Debentures, the Trustee
shall be protected in withholding such notice if and so long as a trust
committee of directors and/or Responsible Officers of the Trustee in good faith
determines that the withholding of such notice is in the interests of the
Debentureholders. For the purpose of this Section 7.08, the term "DEFAULT" means
any event which is, or after notice or lapse of time or both would become, an
Event of Default.

         Section 7.09. Undertaking to Pay Costs. All parties to this Indenture
agree, and each holder of any Debenture by its 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 or omitted by it as Trustee, the
filing by any party litigant in such suit of an undertaking to pay the costs of
such suit and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees and expenses, against any party litigant in
such suit, having due regard to the merits and good faith of the claims or
defenses made by such party litigant; provided that the provisions of this
Section 7.09 (to the extent permitted by law) shall not apply to any suit
instituted by the Trustee, to any suit instituted by any Debentureholder, or
group of Debentureholders, holding in the aggregate more than ten percent in
principal amount of the Debentures at the time outstanding determined in
accordance with Section 9.04, or to any suit instituted by any Debentureholder
for the enforcement of the payment of the principal of or interest on any
Debenture on or after the due date expressed in such Debenture or to any suit
for the enforcement of the right to convert any Debenture in accordance with the
provisions of Article 15.

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<PAGE>

                                    ARTICLE 8
                                   THE TRUSTEE

         Section 8.01. Duties and Responsibilities of Trustee. The Trustee,
prior to the occurrence of an Event of Default and after the curing of all
Events of Default which may have occurred, undertakes to perform such duties and
only such duties as are specifically set forth in this Indenture. In case an
Event of Default has occurred (which has not been cured or waived), the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of his own affairs.

         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:

                  (a)      prior to the occurrence of an Event of Default and
         after the curing or waiving of all Events of Default which may have
         occurred:

                           (i)      the duties and obligations of the Trustee
                  shall be determined solely by the express provisions of this
                  Indenture and the Trust Indenture Act, and the Trustee shall
                  not be liable except for the performance of such duties and
                  obligations as are specifically set forth in this Indenture
                  and no implied covenants or obligations shall be read into
                  this Indenture and the Trust Indenture Act against the
                  Trustee; and

                           (ii)     in the absence of bad faith on the part of
                  the Trustee, the Trustee may conclusively rely as to the truth
                  of the statements and the correctness of the opinions
                  expressed therein, upon any 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 (but need
                  not confirm or investigate the accuracy of mathematical
                  calculations or other facts stated therein);

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

                  (c)      the Trustee shall not be liable with respect to any
         action taken or omitted to be taken by it in good faith in accordance
         with the written direction of the holders of not less than a majority
         in principal amount of the Debentures at the time outstanding
         determined as provided in Section 9.04 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;

                  (d)      the Trustee shall not be liable in respect of any
         payment (as to the correctness of amount, entitlement to receive or any
         other matters relating to payment) or

                                       54

<PAGE>

         notice effected by the Company or any Paying Agent or any records
         maintained by any co-registrar with respect to the Debentures; and

                  (e)      if any party fails to deliver a notice relating to an
         event the fact of which, pursuant to this Indenture, requires notice to
         be sent to the Trustee, the Trustee may conclusively rely on its
         failure to receive such notice as reason to act as if no such event
         occurred.

         The Trustee shall not be deemed to have knowledge or notice of any
default (as defined in Section 7.08) or Event of Default hereunder unless a
Responsible Officer of the Trustee shall have received at the Corporate Trust
Office written notice of such default or Event of Default from the Company or
the holders of at least 10% in aggregate principal amount of the Debentures and
such notice refers to such default or Event of Default, the Debentures and the
Indenture.

         None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.

         Whether or not therein 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 8.01.

         Section 8.02. Reliance on Documents, Opinions, Etc. Except as otherwise
provided in Section 8.01:

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

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

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

                  (d)      the Trustee shall be under no obligation to exercise
         any of the rights or powers vested in it by this Indenture at the
         request, order or direction of any of the Debentureholders pursuant to
         the provisions of this Indenture, unless such

                                       55

<PAGE>

         Debentureholders shall have offered to the Trustee reasonable security
         or indemnity satisfactory to it against the costs, expenses and
         liabilities which may be incurred therein or thereby;

                  (e)      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 or other paper or document,
         but the Trustee may make such further inquiry or investigation into
         such facts or matters as it may see fit, and, if the Trustee shall
         determine to make such further inquiry or investigation, it shall be
         entitled to examine the books, records and premises of the Company,
         personally or by agent or attorney;

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

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

                  (h)      the rights, privileges, protections, immunities and
         benefits given to the Trustee, including, without limitation, its right
         to be indemnified, are extended to, and shall be enforceable by, the
         Trustee in each of its capacities hereunder, and each agent, custodian
         and other Person employed to act hereunder;

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

                  (j)      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, conclusively rely upon an
         Officers' Certificate; and

                  (k)      the Trustee may, before taking any action or
         refraining from taking any action under the Indenture, require that an
         indemnity satisfactory to it be furnished for the reimbursement of all
         expenses to which it may be put and to protect it against all
         liability, including costs incurred in defending itself against any and
         all charges, claims, complaints, allegations, assertions or demands of
         any nature whatsoever, except liability which is adjudicated to be a
         result of the Trustee's negligence or misconduct in connection with any
         such action.

         Section 8.03. No Responsibility for Recitals, Etc. The recitals
contained herein and in the Debentures (except in the Trustee's certificate of
authentication) shall be taken as the

                                       56

<PAGE>

statements of the Company, and the Trustee assumes no responsibility for the
correctness of the same. The Trustee makes no representations as to the validity
or sufficiency of this Indenture or of the Debentures. The Trustee shall not be
accountable for the use or application by the Company of any Debentures or the
proceeds of any Debentures authenticated and delivered by the Trustee in
conformity with the provisions of this Indenture.

         Section 8.04. Trustee, Paying Agents, Conversion Agents or Registrar
May Own Debentures. The Trustee, any Paying Agent, any Conversion Agent or
Debenture Registrar, in its individual or any other capacity, may become the
owner or pledgee of Debentures with the same rights it would have if it were not
Trustee, Paying Agent, Conversion Agent or Debenture Registrar.

         Section 8.05. Monies to Be Held in Trust. Subject to the provisions of
Section 13.03, all monies received by the Trustee shall, until used or applied
as herein provided, be held in trust for the purposes for which they were
received. Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
may be agreed in writing from time to time by the Company and the Trustee.

         Section 8.06. Compensation and Expenses of Trustee. The Company
covenants and agrees to pay to the Trustee from time to time, and the Trustee
shall be entitled to, such compensation for all services rendered by it
hereunder in any capacity (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) as mutually agreed
to from time to time in writing between the Company and the Trustee, and the
Company will pay or reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances reasonably incurred or made by the Trustee
in accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all Persons not regularly in its employ) except any such expense, disbursement
or advance as may arise from its negligence or willful misconduct. The Company
also covenants to indemnify the Trustee and any predecessor Trustee (or any
officer, director or employee of the Trustee), in any capacity under this
Indenture and its agents and any authenticating agent for, and to hold them
harmless against, any and all loss, liability, damage, claim or expense
including taxes (other than taxes based on the income of the Trustee) incurred
without negligence or willful misconduct on the part of the Trustee or such
officers, directors, employees and agent or authenticating agent, as the case
may be, and arising out of or in connection with the acceptance or
administration of this trust or in any other capacity hereunder, including the
costs and expenses of defending themselves against any claim (whether asserted
by the Company, any holder or any other Person) of liability in connection with
the exercise or performance of any of its powers or duties hereunder. The
obligations of the Company under this Section 8.06 to compensate or indemnify
the Trustee and to pay or reimburse the Trustee for expenses, disbursements and
advances shall be secured by a lien prior to that of the Debentures upon all
property and funds held or collected by the Trustee as such, except funds held
in trust for the benefit of the holders of particular Debentures. The obligation
of the Company under this Section shall survive the satisfaction and discharge
of this Indenture.

         When the Trustee and its agents and any authenticating agent incur
expenses or render services after an Event of Default specified in Section
7.01(j) or Section 7.01(k) occurs with

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respect to the Company, the expenses and the compensation for the services are
intended to constitute expenses of administration under any bankruptcy,
insolvency or similar laws.

         Section 8.07. Officers' Certificate as Evidence. Except as otherwise
provided in Section 8.01, whenever in the administration of the provisions of
this Indenture the Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or omitting any action hereunder, such
matter (unless other evidence in respect thereof be herein specifically
prescribed) may, in the absence of bad faith or willful misconduct on the part
of the Trustee, be deemed to be conclusively proved and established by an
Officers' Certificate delivered to the Trustee.

         Section 8.08. Conflicting Interests of Trustee. If the Trustee has or
shall acquire a conflicting interest within the meaning of the Trust Indenture
Act, the Trustee shall either eliminate such interest or resign, to the extent
and in the manner provided by, and subject to the provisions of, the Trust
Indenture Act and this Indenture.

         Section 8.09. Eligibility of Trustee. There shall at all times be a
Trustee hereunder which shall be a Person that is eligible pursuant to the Trust
Indenture Act to act as such and has a combined capital and surplus of at least
$50,000,000 (or if such Person is a member of a bank holding company system, its
bank holding company shall have a combined capital and surplus of at least
$50,000,000). If such Person publishes reports of condition at least annually,
pursuant to law or to the requirements of any supervising or examining
authority, then for the purposes of this Section the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Trustee shall cease to be eligible in accordance with the provisions of this
Section 8.09, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.

         Section 8.10. Resignation or Removal of Trustee. (a) The Trustee may at
any time resign by giving written notice of such resignation to the Company and
to the holders of Debentures. Upon receiving such notice of resignation, the
Company shall promptly appoint a successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to the
successor trustee. If no successor trustee shall have been so appointed and have
accepted appointment sixty (60) days after the mailing of such notice of
resignation to the Debentureholders, the resigning Trustee may, upon ten (10)
Business Days' notice to the Company and the Debentureholders, may petition, at
the expense of the Company, any court of competent jurisdiction for the
appointment of a successor trustee, or, if any Debentureholder who has been a
bona fide holder of a Debenture or Debentures for at least six months may,
subject to the provisions of Section 7.09, on behalf of himself and all others
similarly situated, petition any such court for the appointment of a successor
trustee. Such court may thereupon, after such notice, if any, as it may deem
proper and prescribe, appoint a successor trustee.

         (b)      In case at any time any of the following shall occur:

                  (i)      the Trustee shall fail to comply with Section 8.08
         after written request therefor by the Company or by any Debentureholder
         who has been a bona fide holder of a Debenture or Debentures for at
         least six months; or

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<PAGE>

                  (ii)     the Trustee shall cease to be eligible in accordance
         with the provisions of Section 8.09 and shall fail to resign after
         written request therefor by the Company or by any such Debentureholder;
         or

                  (iii)    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, the Company may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, executed by order of the
Board of Directors, one copy of which instrument shall be delivered to the
Trustee so removed and one copy to the successor trustee, or, subject to the
provisions of Section 7.09, any Debentureholder who has been a bona fide holder
of a Debenture or Debentures 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;
provided that if no successor Trustee shall have been appointed and have
accepted appointment sixty (60) days after either the Company or the
Debentureholders has removed the Trustee, or the Trustee resigns, the Trustee so
removed may petition, at the expense of the Company, any court of competent
jurisdiction for an appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and prescribe,
remove the Trustee and appoint a successor trustee.

         (c)      The holders of a majority in aggregate principal amount of the
Debentures at the time outstanding may at any time remove the Trustee and
nominate a successor trustee which shall be deemed appointed as successor
trustee unless, within ten (10) days after notice to the Company of such
nomination, the Company objects thereto, in which case the Trustee so removed or
any Debentureholder, or if such Trustee so removed or any Debentureholder fails
to act, the Company, upon the terms and conditions and otherwise as in Section
8.10(a) provided, may petition any court of competent jurisdiction for an
appointment of a successor trustee.

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

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

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collected by such trustee as such, except for funds held in trust for the
benefit of holders of particular Debentures, to secure any amounts then due it
pursuant to the provisions of Section 8.06.

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

         Upon acceptance of appointment by a successor trustee as provided in
this Section 8.11, the Company (or the former trustee, at the written direction
of the Company) shall mail or cause to be mailed notice of the succession of
such trustee hereunder to the holders of Debentures at their addresses as they
shall appear on the Debenture Register. If the Company fails to mail such notice
within ten (10) days after acceptance of appointment by the successor trustee,
the successor trustee shall cause such notice to be mailed at the expense of the
Company.

         Section 8.12. Succession by Merger. Any Person into which the Trustee
may be merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which the Trustee
shall be a party, or any Person succeeding to all or substantially all of the
corporate trust business of the Trustee (including any trust created by this
Indenture), shall be the successor to the Trustee hereunder without the
execution or filing of any paper or any further act on the part of any of the
parties hereto; provided that, in the case of any Person succeeding to all or
substantially all of the corporate trust business of the Trustee, such Person
shall be qualified under the provisions of Section 8.08 and eligible under the
provisions of Section 8.09.

         In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture, any of the Debentures shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor trustee or authenticating agent
appointed by such predecessor trustee, and deliver such Debentures so
authenticated; and in case at that time any of the Debentures shall not have
been authenticated, any successor to the Trustee or any authenticating agent
appointed by such successor trustee may authenticate such Debentures in the name
of the successor trustee; and in all such cases such certificates shall have the
full force that is provided in the Debentures or in this Indenture; provided
that the right to adopt the certificate of authentication of any predecessor
Trustee or authenticate Debentures in the name of any predecessor Trustee shall
apply only to its successor or successors by merger, conversion or
consolidation.

         Section 8.13. Preferential Collection of Claims. If and when the
Trustee shall be or become a creditor of the Company (or any other obligor upon
the Debentures), the Trustee shall be subject to the provisions of the Trust
Indenture Act regarding the collection of the claims against the Company (or any
such other obligor).

                                   ARTICLE 9
                              THE DEBENTUREHOLDERS

         Section 9.01. Action by Debentureholders. Whenever in this Indenture it
is provided that the holders of a specified percentage in aggregate principal
amount of the Debentures may take

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any action (including the making of any demand or request, the giving of any
notice, consent or waiver or the taking of any other action), the fact that at
the time of taking any such action, the holders of such specified percentage
have joined therein may be evidenced (a) by any instrument or any number of
instruments of similar tenor executed by Debentureholders in person or by agent
or proxy appointed in writing, or (b) by the record of the holders of Debentures
voting in favor thereof at any meeting of Debentureholders duly called and held
in accordance with the provisions of Article 10, or (c) by a combination of such
instrument or instruments and any such record of such a meeting of
Debentureholders. Whenever the Company or the Trustee solicits the taking of any
action by the holders of the Debentures, the Company or the Trustee may fix in
advance of such solicitation, a date as the record date for determining holders
entitled to take such action. The record date shall he not more than fifteen
(15) days prior to the date of commencement solicitation of such action.

         Section 9.02. Proof of Execution by Debentureholders. Subject to the
provisions of Section 8.01, 8.02 and 10.05, proof of the execution of any
instrument by a Debentureholder or its agent or proxy shall be sufficient if
made in accordance with such reasonable rules and regulations as may be
prescribed by the Trustee or in such manner as shall be satisfactory to the
Trustee. The holding of Debentures shall be proved by the registry of such
Debentures or by a certificate of the Debenture Registrar.

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

         Section 9.03. Who Are Deemed Absolute Owners. The Company, the Trustee,
any Paying Agent, any Conversion Agent and any Debenture Registrar may deem the
Person in whose name such Debenture shall be registered upon the Debenture
Register to be, and may treat it as, the absolute owner of such Debenture
(whether or not such Debenture shall be overdue and notwithstanding any notation
of ownership or other writing thereon made by any Person other than the Company
or any Debenture Registrar) for the purpose of receiving payment of or on
account of the principal of and interest on such Debenture, for conversion of
such Debenture and for all other purposes; and neither the Company nor the
Trustee nor any Paying Agent nor any Conversion Agent nor any Debenture
Registrar shall be affected by any notice to the contrary. All such payments so
made to any holder for the time being, or upon his order, shall be valid, and,
to the extent of the sum or sums so paid, effectual to satisfy and discharge the
liability for monies payable upon any such Debenture.

         Section 9.04. Company-owned Debentures Disregarded. In determining
whether the holders of the requisite aggregate principal amount of Debentures
have concurred in any direction, consent, waiver or other action under this
Indenture, Debentures which are owned by the Company or any other obligor on the
Debentures or any Affiliate of the Company or any other obligor on the
Debentures shall be disregarded and deemed not to be outstanding for the purpose
of any such determination; provided that for the purposes of determining whether
the Trustee shall be protected in relying on any such direction, consent, waiver
or other action, only Debentures which a Responsible Officer knows are so owned
shall be so disregarded. Debentures so owned which have been pledged in good
faith may be regarded as outstanding for the purposes of this Section 9.04 if
the pledgee shall establish to the satisfaction of the Trustee the pledgee's
right to vote such Debentures and that the pledgee is not the Company, any other

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<PAGE>

obligor on the Debentures or any Affiliate of the Company or any such other
obligor. In the case of a dispute as to such right, any decision by the Trustee
taken upon the advice of counsel shall fully protect the Trustee. Upon request
of the Trustee, the Company shall furnish to the Trustee promptly an Officers'
Certificate listing and identifying all Debentures, if any, known by the Company
to be owned or held by or for the account of any of the above described Persons,
and, subject to Section 8.01, the Trustee shall be entitled to accept such
Officers' Certificate as conclusive evidence of the facts therein set forth and
of the fact that all Debentures listed therein are outstanding for the purpose
of any such determination.

         Section 9.05. Revocation of Consents, Future Holders Bound. At any time
prior to (but not after) the evidencing to the Trustee, as provided in Section
9.01, of the taking of any action by the holders of the percentage in aggregate
principal amount of the Debentures specified in this Indenture in connection
with such action, any holder of a Debenture which is shown by the evidence to be
included in the Debentures the holders of which have consented to such action
may, by filing written notice with the Trustee at its Corporate Trust Office and
upon proof of holding as provided in Section 9.02, revoke such action so far as
concerns such Debenture. Except as aforesaid, any such action taken by the
holder of any Debenture shall be conclusive and binding upon such holder and
upon all future holders and owners of such Debenture and of any Debentures
issued in exchange or substitution therefor, irrespective of whether any
notation in regard thereto is made upon such Debenture or any Debenture issued
in exchange or substitution therefor.

                                   ARTICLE 10
                          MEETINGS OF DEBENTUREHOLDERS

         Section 10.01. Purpose of Meetings. A meeting of Debentureholders may
be called at any time and from time to time pursuant to the provisions of this
Article 10 for any of the following purposes:

                  (1)      to give any notice to the Company or to the Trustee
         or to give any directions to the Trustee permitted under this
         Indenture, or to consent to the waiving of any default or Event of
         Default hereunder and its consequences, or to take any other action
         authorized to be taken by Debentureholders pursuant to any of the
         provisions of Article 7;

                  (2)      to remove the Trustee and nominate a successor
         trustee pursuant to the provisions of Article 8;

                  (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 Debentures under any other provision of this Indenture or under
         applicable law.

         Section 10.02. Call of Meetings by Trustee. The Trustee may at any time
call a meeting of Debentureholders to take any action specified in Section
10.01, to be held at such time and at such place as the Trustee shall determine.
Notice of every meeting of the Debentureholders,

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<PAGE>

setting forth the time and the place of such meeting and in general terms the
action proposed to be taken at such meeting and the establishment of any record
date pursuant to Section 9.01, shall be mailed to holders of Debentures at their
addresses as they shall appear on the Debenture Register. Such notice shall also
be mailed to the Company. Such notices shall be mailed not less than 20 nor more
than ninety (90) days prior to the date fixed for the meeting.

         Any meeting of Debentureholders shall be valid without notice if the
holders of all Debentures then outstanding are present in person or by proxy or
if notice is waived before or after the meeting by the holders of all Debentures
outstanding, and if the Company and the Trustee are either present by duly
authorized representatives or have, before or after the meeting, waived notice.

         Section 10.03. Call of Meetings by Company or Debentureholders. In case
at any time the Company, pursuant to a resolution of its Board of Directors, or
the holders of at least 10% in aggregate principal amount of the Debentures then
outstanding, shall have requested the Trustee to call a meeting of
Debentureholders, by written request setting forth in reasonable detail the
action proposed to be taken at the meeting, and the Trustee shall not have
mailed the notice of such meeting within twenty (20) days after receipt of such
request, then the Company or such Debentureholders may determine the time and
the place for such meeting and may call such meeting to take any action
authorized in Section 10.01, by mailing notice thereof as provided in Section
10.02.

         Section 10.04. Qualifications for Voting. To be entitled to vote at any
meeting of Debentureholders a person shall (a) be a holder of one or more
Debentures on the record date pertaining to such meeting or (b) be a person
appointed by an instrument in writing as proxy by a holder of one or more
Debentures on the record date pertaining to such meeting. The only persons who
shall be entitled to be present or to speak at any meeting of Debentureholders
shall be the persons entitled to vote at such meeting and their counsel and any
representatives of the Trustee and its counsel and any representatives of the
Company and its counsel.

         Section 10.05. Regulations. Notwithstanding any other provisions of
this Indenture, the Trustee may make such reasonable regulations as it may deem
advisable for any meeting of Debentureholders, in regard to proof of the holding
of Debentures and of the appointment of proxies, and in regard to the
appointment and duties of inspectors of votes, the submission and examination of
proxies, certificates and other evidence of the right to vote, and such other
matters concerning the conduct of the meeting as it shall think fit.

         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 Debentureholders as provided in Section 10.03, in which case the
Company or the Debentureholders calling the meeting, as the case may be, shall
in like manner appoint a temporary chairman. A permanent chairman and a
permanent secretary of the meeting shall be elected by vote of the holders of a
majority in principal amount of the Debentures represented at the meeting and
entitled to vote at the meeting.

         Subject to the provisions of Section 9.04, at any meeting each
Debentureholder or proxyholder shall be entitled to one vote for each $1,000
principal amount of Debentures held or

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<PAGE>

represented by him; provided that no vote shall be cast or counted at any
meeting in respect of any Debenture 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 Debentures held by him or
instruments in writing as aforesaid duly designating him as the proxy to vote on
behalf of other Debentureholders. Any meeting of Debentureholders duly called
pursuant to the provisions of Section 10.02 or 10.03 may be adjourned from time
to time by the holders of a majority of the aggregate principal amount of
Debentures represented at the meeting, whether or not constituting a quorum, and
the meeting may be held as so adjourned without further notice.

         Section 10.06. Voting. The vote upon any resolution submitted to any
meeting of Debentureholders shall be by written ballot on which shall be
subscribed the signatures of the holders of Debentures or of their
representatives by proxy and the outstanding principal amount of the Debentures
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
Debentureholders shall be prepared by the secretary of the meeting and there
shall be attached to said record the original reports of the inspectors of votes
on any vote by ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was mailed as provided in Section 10.02. The record
shall show the principal amount of the Debentures 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, the latter to have attached thereto the ballots voted at the meeting.

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

         Section 10.07. No Delay of Rights by Meeting. Nothing contained in this
Article 10 shall be deemed or construed to authorize or permit, by reason of any
call of a meeting of Debentureholders or any rights expressly or impliedly
conferred hereunder to make such call, any hindrance or delay in the exercise of
any right or rights conferred upon or reserved to the Trustee or to the
Debentureholders under any of the provisions of this Indenture or of the
Debentures.

                                   ARTICLE 11
                             SUPPLEMENTAL INDENTURES

         Section 11.01. Supplemental Indentures Without Consent of
Debentureholders. The Company, when authorized by the resolutions of the Board
of Directors, and the Trustee may, from time to time, and at any time enter into
an indenture or indentures supplemental hereto for one or more of the following
purposes:

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<PAGE>

                  (a)      make provision with respect to the conversion rights
         of the holders of Debentures pursuant to the requirements of Section
         15.06 or the repurchase obligations of the Company pursuant to the
         requirements of Section 3.08(h);

                  (b)      to convey, transfer, assign, mortgage or pledge to
         the Trustee as security for the Debentures, any property or assets;

                  (c)      to add a guarantor with respect to the Debentures;

                  (d)      to evidence the succession of another Person to the
         Company, or successive successions, and the assumption by the successor
         Person of the covenants, agreements and obligations of the Company
         pursuant to Article 12;

                  (e)      to surrender any of its rights or powers under the
         Indenture (including, without limitation, the right to pay any part of
         the Repurchase Price of the Debentures with shares of Common Stock as
         provided for by the Indenture existing on a date after the date of such
         amendment);

                  (f)      to add to the covenants of the Company such further
         covenants, restrictions or conditions for the benefit of the holders of
         Debentures, and to make the occurrence, or the occurrence and
         continuance, of a default in any such additional covenants,
         restrictions or conditions a default or an Event of Default permitting
         the enforcement of all or any of the several remedies provided in this
         Indenture as herein set forth; provided that in respect of any such
         additional covenant, restriction or condition, such supplemental
         indenture may provide for a particular period of grace after default
         (which period may be shorter or longer than that allowed in the case of
         other defaults) or may provide for an immediate enforcement upon such
         default or may limit the remedies available to the Trustee upon such
         default;

                  (g)      to make any changes or modifications necessary in
         connection with the registration of the Debentures under the Securities
         Act as contemplated by the Registration Rights Agreement, so long as
         any such change or modification shall not materially adversely affect
         the interests of the holders of the Debentures;

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

                  (i)      to cure any ambiguity or to correct or supplement any
         provision contained herein or in any supplemental indenture that may be
         defective or inconsistent with any other provisions contained herein or
         in any supplemental indenture, or to make such other provision in
         regard to matters or questions arising under this Indenture that shall
         not materially adversely affect the interests of the holders of the
         Debentures;

                  (j)      to evidence and provide for the acceptance of
         appointment hereunder by a successor Trustee with respect to the
         Debentures;

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<PAGE>

                  (k)      to modify, eliminate or add to the provisions of this
         Indenture to such extent as shall be necessary to effect the
         qualifications of this Indenture or any supplemental indenture under
         the Trust Indenture Act, or under any similar federal statute hereafter
         enacted; or

                  (l)      make other changes to the Indenture or forms or terms
         of the Debentures, provided no such change individually or in the
         aggregate with all other such changes has or will have a material
         adverse effect on the interests of the Debentureholders.

         Upon the written request of the Company, accompanied by a copy of the
resolutions of the Board of Directors certified by the Company's Secretary or
Assistant Secretary authorizing the execution of any supplemental indenture, the
Trustee is hereby authorized to join with the Company in the execution of any
such supplemental indenture, to make any further appropriate agreements and
stipulations that may be therein contained and to accept the conveyance,
transfer and assignment of any property thereunder, but the Trustee shall not be
obligated to, but may in its discretion, enter into any supplemental indenture
that affects the Trustee's own rights, duties or immunities under this Indenture
or otherwise.

         Any supplemental indenture authorized by the provisions of this Section
11.01 may be executed by the Company and the Trustee without the consent of the
holders of any of the Debentures at the time outstanding, notwithstanding any of
the provisions of Section 11.02.

         Notwithstanding any other provision of the Indenture or the Debentures,
the Registration Rights Agreement and the obligation to pay Additional Amounts
thereunder may be amended, modified or waived in accordance with the provisions
of the Registration Rights Agreement.

         Section 11.02. Supplemental Indenture with Consent of Debentureholders.
With the consent (evidenced as provided in Article 9) of the holders of at least
a majority in aggregate principal amount of the Debentures at the time
outstanding, the Company, when authorized by the resolutions of the Board of
Directors, and the Trustee may, from time to time and at any time, enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or any supplemental indenture or of modifying in any manner the
rights of the holders of the Debentures; provided that no such supplemental
indenture shall (i) extend the Stated Maturity of any Debenture, or reduce the
rate or extend the time of payment of interest thereon, or reduce the principal
amount thereof, or reduce any amount payable on redemption or repurchase
thereof, or impair the right of any Debentureholder to institute suit for the
payment thereof, or make the principal thereof or interest thereon payable in
any coin or currency other than that provided in the Debentures, or affect the
obligation of the Company to redeem any Debenture on a Redemption Date in a
manner adverse to the holders of Debentures, or affect the obligation of the
Company to repurchase any Debenture upon the happening of a Fundamental Change
in a manner adverse to the holders of Debentures, or affect the obligation of
the Company to repurchase any Debenture on a Company Repurchase Date in a manner
adverse to the holders of Debentures, or impair the right to convert the
Debentures into shares of Common Stock subject to the terms set forth herein,
including Section 15.06, or reduce the number of shares of Common Stock or other
property receivable upon conversion, in each case, without the consent of the
holder of each Debenture so affected, or modify any of the provisions of this
Section 11.02 or

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Section 7.07, 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 Debenture so affected, or change any obligation of
the Company to maintain an office or agency in the places and for the purposes
set forth in Section 5.02, or reduce the quorum or voting requirements set forth
in Article 10 or (ii) reduce the aforesaid percentage of Debentures, the holders
of which are required to consent to any such supplemental indenture, without the
consent of the holders of all Debentures then outstanding.

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

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

         Section 11.03. Effect of Supplemental Indenture. Any supplemental
indenture executed pursuant to the provisions of this Article 11 shall comply
with the Trust Indenture Act, as then in effect, provided that this Section
11.03 shall not require such supplemental indenture or the Trustee to be
qualified under the Trust Indenture Act prior to the time such qualification is
in fact required under the terms of the Trust Indenture Act or the Indenture has
been qualified under the Trust Indenture Act, nor shall it constitute any
admission or acknowledgment by any party to such supplemental indenture that any
such qualification is required prior to the time such qualification is in fact
required under the terms of the Trust Indenture Act or the Indenture has been
qualified under the Trust Indenture Act. Upon the execution of any supplemental
indenture pursuant to the provisions of Article 11, this Indenture shall be and
shall be deemed to be modified and amended in accordance therewith and the
respective rights, limitation of rights, obligations, duties and immunities
under this Indenture of the Trustee, the Company and the holders of Debentures
shall thereafter be determined, exercised and enforced hereunder, subject in all
respects to such modifications and amendments and all the terms and conditions
of any such supplemental indenture shall be and shall be deemed to be part of
the terms and conditions of this Indenture for any and all purposes.

         Section 11.04. Notation on Debentures. Debentures authenticated and
delivered after the execution of any supplemental indenture pursuant to the
provisions of this Article 11 may bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental indenture. If the
Company or the Trustee shall so determine, new Debentures so modified as to
conform, in the opinion of the Trustee and the Board of Directors, to any
modification of this Indenture contained in any such supplemental indenture may,
at the Company's expense, be prepared and executed by the Company, authenticated
by the Trustee (or an authenticating agent duly appointed by the Trustee
pursuant to Section 16.13) and delivered in exchange for the Debentures then
outstanding, upon surrender of such Debentures then outstanding.

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         Section 11.05. Evidence of Compliance of Supplemental Indenture to Be
Furnished to Trustee. Prior to entering into any supplemental indenture, the
Trustee shall be provided with an Officers' Certificate and an Opinion of
Counsel as conclusive evidence that any supplemental indenture executed pursuant
hereto complies with the requirements of this Article 11 and is otherwise
authorized or permitted by this Indenture.

                                   ARTICLE 12
                CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE

         Section 12.01. Company May Consolidate on Certain Terms. Subject to the
provisions of Section 12.02, the Company shall not consolidate or merge with or
into any other Person or Persons (whether or not affiliated with the Company),
nor shall the Company or its successor or successors be a party or parties to
successive consolidations or mergers, nor shall the Company sell, convey,
transfer or lease the property and assets of the Company substantially as an
entirety, to any other Person (whether or not affiliated with the Company),
unless: (i) the Company is the surviving Person, or the resulting, surviving or
transferee Person is a corporation organized and existing under the laws of the
United States of America, any state thereof or the District of Columbia; (ii)
upon any such consolidation, merger, sale, conveyance, transfer or lease, the
due and punctual payment of the principal of and interest on all of the
Debentures, according to their tenor and the due and punctual performance and
observance of all of the covenants and conditions of this Indenture to be
performed by the Company, shall be expressly assumed, by supplemental indenture
satisfactory in form to the Trustee, executed and delivered to the Trustee by
the Person (if other than the Company) formed by such consolidation, or into
which the Company shall have been merged, or by the Person that shall have
acquired or leased such property, and such supplemental indenture shall provide
for the applicable conversion rights set forth in Section 15.06; and (iii)
immediately after giving effect to the transaction described above, no Event of
Default, and no event which, after notice or lapse of time or both, would become
an Event of Default, shall have occurred and be continuing.

         Section 12.02. Successor to Be Substituted. In case of any such
consolidation, merger, sale, conveyance, transfer or lease and upon the
assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the due and
punctual payment of the principal of and interest on all of the Debentures and
the due and punctual performance of all of the covenants and conditions of this
Indenture to be performed by the Company, such successor Person shall succeed to
and be substituted for the Company, with the same effect as if it had been named
herein as the party of this first part. Such successor Person thereupon may
cause to be signed, and may issue either in its own name or in the name of
Quanta Services, Inc. any or all of the Debentures, issuable hereunder that
theretofore shall not have been signed by the Company and delivered to the
Trustee; and, upon the order of such successor Person instead of the Company and
subject to all the terms, conditions and limitations in this Indenture
prescribed, the Trustee shall authenticate and shall deliver, or cause to be
authenticated and delivered, any Debentures that previously shall have been
signed and delivered by the officers of the Company to the Trustee for
authentication, and any Debentures that such successor Person thereafter shall
cause to be signed and delivered to the Trustee for that purpose. All the
Debentures so issued shall in all respects have the same legal rank and benefit
under this Indenture as the Debentures theretofore or thereafter issued in
accordance with the terms of this Indenture as though all of such Debentures had
been issued at

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the date of the execution hereof. In the event of any such consolidation,
merger, sale, conveyance, transfer or lease, the Person named as the "COMPANY"
in the first paragraph of this Indenture or any successor that shall thereafter
have become such in the manner prescribed in this Article 12 may be dissolved,
wound up and liquidated at any time thereafter and such Person shall be released
from its liabilities as obligor and maker of the Debentures and from its
obligations under this Indenture.

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

         Section 12.03. Opinion of Counsel to Be Given Trustee. The Trustee
shall receive an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that any such consolidation, merger, sale, conveyance, transfer or
lease and any such assumption complies with the provisions of this Article 12.

                                   ARTICLE 13
                     SATISFACTION AND DISCHARGE OF INDENTURE

         Section 13.01. Discharge of Indenture. When (a) the Company shall
deliver to the Trustee for cancellation all Debentures theretofore authenticated
(other than any Debentures that have been destroyed, lost or stolen and in lieu
of or in substitution for which other Debentures shall have been authenticated
and delivered) and not theretofore canceled, or (b) all the Debentures not
theretofore canceled or delivered to the Trustee for cancellation shall have
become due and payable and the Company shall deposit with the Trustee, in trust,
cash or, if expressly permitted by the terms of the Debentures or the Indenture,
Common Stock sufficient to pay all amounts due and owing on Debentures (other
than any Debentures that shall have been mutilated, destroyed, lost or stolen
and in lieu of or in substitution for which other Debentures shall have been
authenticated and delivered) not theretofore canceled or delivered to the
Trustee for cancellation, accompanied by a verification report, as to the
sufficiency of the deposited amount, from an independent certified accountant or
other financial professional satisfactory to the Trustee, and if in either case
the Company shall also pay or cause to be paid all other sums payable hereunder
by the Company, then this Indenture shall cease to be of further effect (except
as to (i) remaining rights of registration of transfer, substitution and
exchange and conversion of Debentures, (ii) rights hereunder of Debentureholders
to receive payments of principal of and interest on the Debentures and the other
rights, duties and obligations of Debentureholders, as beneficiaries hereof with
respect to the amounts, if any, so deposited with the Trustee and (iii) the
rights, powers, duties, obligations and immunities of the Trustee hereunder),
and the Trustee, on written demand of the Company accompanied by an Officers'
Certificate and an Opinion of Counsel as required by Section 16.06 and at the
cost and expense of the Company, shall execute proper instruments acknowledging
satisfaction of and discharging this Indenture; the Company, however, hereby
agrees to reimburse the Trustee for any costs or expenses thereafter reasonably
and properly incurred by the Trustee and to compensate the Trustee for any
services thereafter reasonably and properly rendered by the Trustee in
connection with this Indenture or the Debentures.

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         Section 13.02. Paying Agent to Repay Monies Held. Upon the satisfaction
and discharge of this Indenture, all monies then held by any Paying Agent of the
Debentures (other than the Trustee) shall, upon written request of the Company,
be repaid to it or paid to the Trustee, and thereupon such Paying Agent shall be
released from all further liability with respect to such monies.

         Section 13.03. Return of Unclaimed Monies. Subject to the requirements
of applicable law, any monies deposited with or paid to the Trustee for payment
of the principal of or interest on Debentures and not applied but remaining
unclaimed by the holders of Debentures for two years after the date upon which
the principal of or interest on such Debentures, as the case may be, shall have
become due and payable, shall be repaid to the Company by the Trustee on demand
and all liability of the Trustee shall thereupon cease with respect to such
monies; and the holder of any of the Debentures shall thereafter look only to
the Company for any payment that such holder may be entitled to collect unless
an applicable abandoned property law designates another Person.

                                   ARTICLE 14
         IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS

         Section 14.01. Indenture and Debentures Solely Corporate Obligations.
No recourse for the payment of the principal of or interest on any Debenture, or
for any claim based thereon or otherwise in respect thereof, and no recourse
under or upon any obligation, covenant or agreement of the Company in this
Indenture or in any supplemental indenture or in any Debenture, or because of
the creation of any indebtedness represented thereby, shall be had against any
incorporator, stockholder, employee, agent, officer, director or subsidiary, as
such, past, present or future, of the Company or of any successor corporation,
either directly or through the Company or any successor corporation, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise; it being expressly understood that all such
liability is hereby expressly waived and released as a condition of, and as a
consideration for, the execution of this Indenture and the issue of the
Debentures.

                                   ARTICLE 15
                            CONVERSION OF DEBENTURES

         Section 15.01. Right to Convert. (a) Subject to and upon compliance
with the provisions of this Indenture, prior to October 1, 2023, the holder of
any Debenture shall have the right, at such holder's option, to convert the
principal amount of the Debenture, or any portion of such principal amount which
is a multiple of $1,000, into fully paid and non-assessable shares of Common
Stock (as such shares shall then be constituted) at the Conversion Rate in
effect at such time, by surrender of the Debenture so to be converted in whole
or in part, together with any required funds, under the circumstances described
in this Section 15.01 and in the manner provided in Section 15.02. The
Debentures shall be convertible only during the following periods upon the
occurrence of one of the following events:

                  (i)      during any fiscal quarter after the fiscal quarter
         ending December 31, 2003 if the Last Reported Sale Price of the Common
         Stock for at least twenty (20) Trading Days during the period of thirty
         (30) consecutive Trading Days ending on the first

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         Trading Day of such fiscal quarter equals or exceeds 120% of the
         Conversion Price on such first Trading Day;

                  (ii)     in the event that the Company calls the Debentures
         for redemption, at any time prior to the close of business on the
         second Business Day immediately preceding the Redemption Date; provided
         that only those Debentures that are called for redemption may be
         converted following such an event;

                  (iii)    as provided in Section (b) of this Section 15.01; or

                  (iv)     during the five (5) Business Day period immediately
         after any five (5) consecutive Trading Day period in which the Trading
         Price per $1,000 principal amount of the Debentures for each day of
         such five (5) day measurement period was less than 98% of the product
         of the Last Reported Sale Price of the Common Stock on the applicable
         date and the Conversion Rate.

         Notwithstanding the foregoing, if, on the date of any conversion
pursuant to Section 15.01(a)(iv) on or after October 1, 2018, the Last Reported
Sale Price of the Common Stock on the Trading Day before the Conversion Date is
greater than 100% but less than 120% of the Conversion Price, the holders of
Debentures surrendered for conversion shall receive, in lieu of Common Stock
based on the Conversion Rate, cash or Common Stock or a combination of cash and
Common Stock, at the Company's option, with a value equal to the principal
amount of the Debentures being converted plus accrued and unpaid interest
(including Additional Amounts, if any), as of the Conversion Date ("PRINCIPAL
VALUE CONVERSION"). Any Common Stock delivered upon a Principal Value Conversion
will be valued at the greater of the Conversion Price on the Conversion Date and
the average of the Last Reported Sale Price of the Common Stock for a five (5)
Trading Day period starting the third Trading Day following the Conversion Date
of such Debentures. If a holder of Debentures surrenders their Debentures for a
Principal Value Conversion, the Company shall notify such holder by the second
Trading Day following the Conversion Date that it is a Principal Value
Conversion and whether the Company will pay such Holder all or a portion of the
principal amount plus accrued and unpaid interest and Additional Amounts, if
any, in cash, Common Stock or a combination of cash and Common Stock, and in
what percentage. The Company will pay such holder any portion of the principal
amount plus accrued and unpaid interest and Additional Amounts, if any, to be
paid in cash and deliver Common Stock with respect to any portion of the
principal amount plus accrued and unpaid interest and Additional Amounts, if
any, to be paid in Common Stock, no later than the third Business Day following
the determination of the average Last Reported Sale Price of the Common Stock.

         The Company or its designated agent shall determine on a daily basis
during the time period specified in Section 15.01(a)(i) whether the Debentures
shall be convertible as a result of the occurrence of an event specified in
clause (i) above and, if the Debentures shall be so convertible, the Company
shall promptly deliver to the Trustee (or other Conversion Agent appointed by
the Company) written notice thereof. Whenever the Debentures shall become
convertible pursuant to this Section 15.01, the Company or, at the Company's
request, the Trustee in the name and at the expense of the Company, shall notify
the holders of the event triggering such convertibility in the manner provided
in Section 16.04, and the Company shall also publicly announce such information
by publication on the Company's web site or through

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such other public medium as it may use at such time. Any notice so given shall
be conclusively presumed to have been duly given, whether or not the holder
receives such notice.

         The Trustee (or other Conversion Agent appointed by the Company) shall
have no obligation to determine the Trading Price under this Section 15.01
unless the Company has requested in writing such a determination; and the
Company shall have no obligation to make such request unless a holder provides
it with reasonable evidence that the Trading Price per $1,000 principal amount
of Debentures would be less than 98% of the product of the Last Reported Sale
Price of the Common Stock and the Conversion Rate. If such evidence is provided,
the Company shall instruct the Trustee (or other Conversion Agent) in writing to
determine the Trading Price of the Debentures beginning on the next Trading Day
and on each successive Trading Day until, and only until, the Trading Price per
$1,000 principal amount of Debentures is greater than or equal to 98% of the
product of the Last Reported Sale Price of the Common Stock and the Conversion
Rate.

         The Trustee shall be entitled at its sole discretion to consult with
the Company and to request the assistance of the Company in connection with the
Trustee's duties and obligations pursuant to Section 15.01(a) hereof, and the
Company agrees, if requested by the Trustee, to cooperate with, and provide
assistance to, the Trustee in carrying out its duties under this Section 15.01;
provided, however, that nothing herein shall be construed to relieve the Trustee
of its duties pursuant to Section 15.01(a) hereof.

         (b)      In addition, if:

                  (i)      the Company distributes to all holders of its Common
         Stock rights or warrants entitling them (for a period expiring within
         forty-five (45) days of the date of the distribution) to subscribe for
         or purchase shares of Common Stock at a price per share less than the
         Last Reported Sale Price of the Common Stock on the Trading Day
         immediately preceding the declaration date of the distribution, or (B)
         the Company distributes to all holders of Common Stock assets
         (including cash), debt securities or rights to purchase securities of
         the Company, which distribution has a per share value as determined by
         the Company's Board of Directors and set forth in a Board Resolution
         exceeding 10% of the Last Reported Sale Price of the Common Stock on
         the Trading Day immediately preceding the declaration date for such
         distribution, then, in either case, the Debentures may be surrendered
         for conversion at any time on and after the date that the Company gives
         notice to the holders of such distribution, which shall be not less
         than twenty (20) days prior to the Ex-Dividend Date for such
         distribution, until the earlier of the close of business on the
         Business Day immediately preceding, but not including, the Ex-Dividend
         Date or the date the Company publicly announces that such distribution
         will not take place; provided that no adjustment to the Conversion
         Price or the ability of a holder of a Debenture to convert will be made
         if the holder will otherwise participate in such distribution without
         conversion; and

                  (ii)     the Company consolidates with or merges with or into
         another Person or is a party to a binding share exchange or conveys,
         transfers, sells, leases or otherwise disposes of all or substantially
         all of its properties and assets, in each case pursuant to which the
         Common Stock is converted into cash or property other than securities,
         then

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         the Debentures may be surrendered for conversion at any time from and
         after the date fifteen (15) days prior to the anticipated effective
         date of the transaction and ending on and including the date fifteen
         (15) days after the anticipated effective date of the transaction.

The Board of Directors shall determine the anticipated effective date of the
transaction, and such determination shall be conclusive and binding on the
holders and shall be publicly announced by the Company by publication on its web
site or through such other public medium as it may use at that time not later
than two (2) Business Days prior to such fifteenth day.

         (c)      A Debenture in respect of which a holder is electing to
exercise its option to require repurchase upon a Fundamental Change pursuant to
Section 3.05 or repurchase pursuant to Section 3.06 may be converted only if
such holder withdraws its election in accordance with Section 3.08(d). A holder
of Debentures is not entitled to any rights of a holder of Common Stock until
such holder has converted his Debentures to Common Stock, and only to the extent
such Debentures are deemed to have been converted to Common Stock under this
Article 15.

         Section 15.02. Exercise of Conversion Privilege; Issuance of Common
Stock on Conversion; No Adjustment for Interest or Dividends; Settlement of Cash
or Common Stock upon Conversion. (a) In order to exercise the conversion
privilege with respect to any Debenture in certificated form, the Company must
receive at the office or agency of the Company maintained for that purpose or,
at the option of such holder, the Corporate Trust Office, such Debenture with
the original or facsimile of the form entitled "FORM OF CONVERSION NOTICE" on
the reverse thereof, duly completed and manually signed, together with such
Debentures duly endorsed for transfer, accompanied by the funds, if any,
required by Section 15.02(d). Such notice shall also state the name or names
(with address or addresses) in which the certificate or certificates for shares
of Common Stock which shall be issuable on such conversion shall be issued, and
shall be accompanied by transfer or similar taxes, if required pursuant to
Section 15.07.

         In order to exercise the conversion privilege with respect to any
interest in a Global Debenture, the beneficial holder must complete, or cause to
be completed, the appropriate instruction form for conversion pursuant to the
Depositary's book-entry conversion program, deliver, or cause to be delivered,
by book-entry delivery an interest in such Global Debenture, furnish appropriate
endorsements and transfer documents if required by the Company or the Trustee or
Conversion Agent, and pay the funds, if any, required by this Section 15.02 and
any transfer taxes if required pursuant to Section 15.07.

         (b)      As promptly as practicable after satisfaction of the
requirements for conversion set forth above, subject to compliance with any
restrictions on transfer if shares issuable on conversion are to be issued in a
name other than that of the Debentureholder (as if such transfer were a transfer
of the Debenture or Debentures (or portion thereof) so converted), the Company
shall issue and shall deliver to such Debentureholder at the office or agency
maintained by the Company for such purpose pursuant to Section 5.02, a
certificate or certificates for the number of full shares of Common Stock
issuable upon the conversion of such Debenture or portion thereof as determined
by the Company in accordance with the provisions of this Article 15 and a check
or cash in respect of the Cash Amount pursuant to Section 15.02(h)(iii) (if
applicable) and any

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fractional interest in respect of a share of Common Stock arising upon such
conversion, calculated by the Company as provided in Section 15.03. In case any
Debenture of a denomination greater than $1,000 shall be surrendered for partial
conversion, subject to Section 2.03, the Company shall execute and the Trustee
shall authenticate and deliver to the holder of the Debenture so surrendered,
without charge to him, a new Debenture or Debentures in authorized denominations
in an aggregate principal amount equal to the unconverted portion of the
surrendered Debenture.

         (c)      Each conversion shall be deemed to have been effected as to
any such Debenture (or portion thereof) on the date on which the requirements
set forth above in this Section 15.02 have been satisfied as to such Debenture
(or portion thereof) (such date, the "CONVERSION DATE"), and the Person in whose
name any certificate or certificates for shares of Common Stock shall be
issuable upon such conversion shall be deemed to have become on said date the
holder of record of the shares represented thereby; provided that any such
surrender on any date when the stock transfer books of the Company shall be
closed shall constitute the Person in whose name the certificates are to be
issued as the record holder thereof for all purposes on the next succeeding day
on which such stock transfer books are open, but such conversion shall be at the
Conversion Rate in effect on the date upon which such Debenture shall be
surrendered.

         (d)      Any Debenture or portion thereof surrendered for conversion
during the period from the close of business on any Regular Record Date to the
close of business on the Business Day preceding the following Interest Payment
Date that has not been called for redemption during such period shall be
accompanied by payment, in immediately available funds or other funds acceptable
to the Company, of an amount equal to the interest otherwise payable on such
Interest Payment Date on the principal amount being converted; provided that no
such payment need be made (1) if the Company has specified a Redemption Date
that is after a Regular Record Date and prior to the next Interest Payment Date,
(2) if the Company has specified a Repurchase Date following a Fundamental
Change that is during such period or (3) to the extent of any overdue interest,
if any overdue interest exists at the time of conversion with respect to such
Debenture. Except as provided above in this Section 15.02, no payment or other
adjustment shall be made for interest accrued on any Debenture converted or for
dividends on any shares issued upon the conversion of such Debenture as provided
in this Article 15.

         (e)      Upon the conversion of an interest in a Global Debenture, the
Trustee (or other Conversion Agent appointed by the Company), or the Custodian
at the direction of the Trustee (or other Conversion Agent appointed by the
Company), shall make a notation on such Global Debenture as to the reduction in
the principal amount represented thereby. The Company shall notify the Trustee
in writing of any conversions of Debentures effected through any Conversion
Agent other than the Trustee.

         (f)      Upon the conversion of a Debenture, that portion of the
accrued but unpaid interest with respect to the converted Debenture shall not be
canceled, extinguished or forfeited, but rather shall be deemed to be paid in
full to the holder thereof through delivery of the Common Stock (together with
the cash payment, if any, in lieu of fractional shares) or cash or a combination
of cash and shares of Common Stock in exchange for the Debenture being converted
pursuant to the provisions hereof; and the fair market value of such shares of
Common Stock and any such cash payment in lieu of fractional shares shall be
treated as issued or paid, as

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the case may be, to the extent thereof, first in exchange for and in
satisfaction of the Company's obligation to pay the principal amount of the
converted Debenture and the accrued but unpaid interest, and the balance, if
any, of such fair market value of such Common Stock and any such cash payment
shall be treated as issued or paid, as the case may be, in exchange for and in
satisfaction of the right to convert the Debenture being converted pursuant to
the provisions hereof.

         (g)      In the event that the Company receives a Form of Conversion
Notice on or prior to (1) the date on which the Company gives a Redemption
Notice or (2) the date that is 20 days prior to the Stated Maturity of the
Debentures (the "FINAL NOTICE DATE"), the following procedures shall apply:

                  (i)      If the Company elects to satisfy all or any portion
         of its obligation to convert the Debentures (the "CONVERSION
         Obligation") in cash, the Company shall notify holders through the
         Trustee of the dollar amount to be satisfied in cash (which must be
         expressed either as 100% of the Conversion Obligation or as a fixed
         dollar amount) at any time on or before the date that is two Business
         Days following the Conversion Date (the "CASH SETTLEMENT NOTICE
         PERIOD"). If the Company timely elects to pay cash for any portion of
         the Common Stock otherwise issuable to holders upon conversion, holders
         may retract the Conversion Notice at any time during the two Business
         Days following the final day of the Cash Settlement Notice Period (the
         "CONVERSION RETRACTION PERIOD"). No such retraction can be made (and a
         Form of Conversion Notice shall be irrevocable) if the Company does not
         elect to deliver cash in lieu of Common Stock (other than cash in lieu
         of fractional shares). Upon the expiration of a Conversion Retraction
         Period, a Form of Conversion Notice shall be irrevocable. If the
         Company elects to satisfy all or any portion of the Conversion
         Obligation in cash, and the applicable Form of Conversion Notice has
         not been retracted, then settlement (in cash or in cash and Common
         Stock) will occur on the Business Day following the final day of the
         20-Trading Day period beginning on the day after the final day of the
         Conversion Retraction Period (the "CASH SETTLEMENT AVERAGING PERIOD").

                  (ii)     If the Company does not elect to satisfy any part of
         the Conversion Obligation in cash (other than cash in lieu of any
         fractional shares), delivery of the Common Stock into which the
         Debentures are converted (and cash in lieu of any fractional shares)
         shall occur through the Conversion Agent or the Depositary, as the case
         may be, as soon as practicable on or after the Conversion Date.

         (h)      Settlement amounts will be computed as follows:

                  (i)      If the Company elects to satisfy the entire
         Conversion Obligation in Common Stock, it shall deliver to holders that
         have delivered the Conversion Notice giving rise to the Conversion
         Obligation a number of shares of Common Stock equal to (i) the
         aggregate principal amount of Debentures to be converted divided by
         1,000, multiplied by (ii) the Conversion Rate. In addition, the Company
         shall pay cash for any fractional shares of Common Stock based on the
         Last Reported Sale Price of the Common Stock on the Trading Day
         immediately preceding the Conversion Date.

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                  (ii)     If the Company elects to satisfy the entire
         Conversion Obligation in cash, it shall deliver to holders that have
         delivered the Conversion Notice giving rise to the Conversion
         Obligation cash in an amount equal to the product of:

                           (A)      a number equal to (i) the aggregate
                  principal amount of Debentures to be converted divided by
                  1,000, multiplied by (ii) the Conversion Rate; and

                           (B)      the average Last Reported Sale Price of the
                  Common Stock during the Cash Settlement Averaging Period.

                  (iii)    If the Company elects to satisfy a fixed portion
         (other than 100%) of the Conversion Obligation in cash, it will deliver
         to holders the specified cash amount (the "CASH AMOUNT") and a number
         of shares of Common Stock equal to the greater of (i) zero and (ii) the
         excess, if any, of the number of shares of Common Stock calculated as
         if the Company elected to satisfy the entire Conversion Obligation in
         shares over the number of shares equal to the sum, for each day of the
         Cash Settlement Averaging Period, of (x) the Cash Amount divided by the
         number of days in the Cash Settlement Averaging Period, divided by (y)
         the Last Reported Sale Price of the Common Stock. In addition, the
         Company shall pay cash for all fractional Common Stock based on the
         average Last Reported Sale Price of the Common Stock during the Cash
         Settlement Averaging Period.

                  (iv)     If the Company elects to satisfy the Conversion
         Obligation in Common Stock and if on the date of the Conversion Notice
         (x) the Debentures are neither registered under the Securities Act nor
         immediately freely saleable pursuant to Rule 144(k) under the
         Securities Act and (y) there exists a Registration Default (as defined
         under the Registration Right Agreement), then the Company shall deliver
         to Debentureholders an additional number of shares of Common Stock in
         accordance with Section 3(a) of the Registration Rights Agreement.

         (i)      The Company must determine whether or not it will satisfy all
or a portion of the Conversion Obligation in cash at the time it issues a
Redemption Notice and such notice will state the amount of the Conversion
Obligation to be settled in cash (which must be expressed either as 100% of the
Conversion Obligation or a fixed dollar amount). If the Company elects to
satisfy all or any portion of the Conversion Obligation with respect to
conversions after the Final Notice Date in cash, on or before the Final Notice
Date the Company will send a single notice to holders indicating the dollar
amount to be satisfied in cash (which must be expressed either as 100% of the
Conversion Obligation or a fixed dollar amount). In the event that the Company
receives a Form of Conversion Notice after the date a Redemption Notice has been
issued or the Final Notice Date, settlement amounts will be computed and
settlement dates will be determined in the same manner as set forth in clauses
(g) and (h) of this Section 15.02 except that the Cash Settlement Averaging
Period shall be the 20 Trading Day period beginning on the Trading Day after the
Conversion Date. If a Form of Conversion Notice is received from holders of
Debentures after the date that a Redemption Notice has been issued or the Final
Notice Date, such holders may not retract their Conversion Notice. Settlement
(in cash and/or Common Stock) will occur on the Business Day following the final
day of such Cash Settlement Averaging Period.

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         Section 15.03. Cash Payments in Lieu of Fractional Shares. No
fractional shares of Common Stock or scrip certificates representing fractional
shares shall be issued upon conversion of Debentures. If more than one Debenture
shall be surrendered for conversion at one time by the same holder, the number
of full shares that shall be issuable upon conversion shall be computed on the
basis of the aggregate principal amount of the Debentures (or specified portions
thereof to the extent permitted hereby) so surrendered. If any fractional share
of stock would be issuable upon the conversion of any Debenture or Debentures,
the Company shall make an adjustment and payment therefor in cash to the holder
of Debentures at the Last Reported Sale Price of the Common Stock on the last
Trading Day immediately preceding the day on which the Debentures (or specified
portions thereof) are deemed to have been converted.

         Section 15.04. Conversion Rate. Each $1,000 principal amount of the
Debentures shall be convertible into the number of shares of Common Stock
specified in the form of Debenture (herein called the "CONVERSION RATE")
attached as Exhibit A hereto (initially 89.7989 shares), subject to adjustment
as provided in this Article 15.

         Section 15.05. Adjustment of Conversion Rate. The Conversion Rate shall
be adjusted from time to time by the Company as follows:

                  (a) In case the Company shall pay a dividend or make a
distribution to all holders of the outstanding Common Stock in shares of Common
Stock, the Conversion Rate, as in effect at the opening of business on the day
following the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution, shall be increased by multiplying
such Conversion Rate by a fraction,

                  (i)      the numerator of which shall be the sum of the number
         of shares of Common Stock outstanding at the close of business on the
         date fixed for the determination of stockholders entitled to receive
         such dividend or other distribution plus the total number of shares of
         Common Stock constituting such dividend or other distribution, and

                  (ii)     the denominator of which shall be the number of
         shares of Common Stock outstanding at the close of business on the date
         fixed for such determination,

such increase to become effective immediately after the opening of business on
the Business Day following the date fixed for such determination. If any
dividend or distribution of the type described in this Section 15.05(a) is
declared but not so paid or made, the Conversion Rate shall again be adjusted to
the Conversion Rate that would then be in effect if such dividend or
distribution had not been declared.

         (b)      In case the Company shall (other than pursuant to a dividend
reinvestment plan or share purchase plan) issue rights, options or warrants to
all holders of its Common Stock entitling them, for a period expiring within
forty-five (45) days after the date fixed for the determination of stockholders
entitled to receive such rights, options or warrants, to subscribe for or
purchase shares of Common Stock at a price per share less than the Current
Market Price per share of the Common Stock on the date fixed for the
determination of stockholders entitled to receive such rights, options or
warrants, the Conversion Rate in effect at the opening of business

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on the day following the date fixed for such determination shall be increased by
multiplying such Conversion Rate by a fraction,

                  (i)      the numerator of which shall be the number of shares
         of Common Stock outstanding at the close of business on the date fixed
         for such determination plus the number of shares of Common Stock so
         offered for subscription or purchase at such below Current Market
         Price, and

                  (ii)     the denominator of which shall be the number of
         shares of Common Stock outstanding at the close of business on the date
         fixed for such determination plus the number of shares of Common Stock
         that the aggregate offering price of the total number of shares of
         Common Stock so offered for subscription or purchase would purchase at
         such Current Market Price,

such adjustment shall be successively made whenever any such rights or warrants
are issued and shall become effective immediately after the opening of business
on the Business Day following the date fixed for such determination. The Company
shall not issue any such rights, options or warrants in respect of shares of
Common Stock held in treasury by the Company. To the extent that shares of
Common Stock are not delivered after the expiration of such rights or warrants,
the Conversion Rate shall be readjusted to the Conversion Rate that would then
be in effect had the adjustments made upon the issuance of such rights or
warrants been made on the basis of delivery of only the number of shares of
Common Stock actually delivered. If such rights or warrants are not so issued,
the Conversion Rate shall again be adjusted to be the Conversion Rate that would
then be in effect if such date fixed for the determination of stockholders
entitled to receive such rights or warrants had not been fixed.

         In determining whether any rights or warrants entitle the holders to
subscribe for or purchase shares of Common Stock at less than such Current
Market Price, and in determining the aggregate offering price of such shares of
Common Stock, there shall be taken into account any consideration received by
the Company for such rights or warrants and any amount payable on exercise or
conversion thereof, the value of such consideration, if other than cash, to be
determined by the Board of Directors.

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

         (d)      In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock evidences of its indebtedness,
shares of capital stock, securities, cash or other property (but excluding any
dividend or distribution referred to in Section 15.05(a), any rights, options or
warrants referred to in Section 15.05(b) and any dividend or distribution paid

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exclusively in cash referred to in Section 15.05(e)), the Conversion Rate shall
be adjusted by multiplying the Conversion Rate in effect immediately prior to
the close of business on the date fixed for the determination of stockholders
entitled to receive such distribution by a fraction,

                  (i)      the numerator of which shall be the Current Market
         Price per share of the Common Stock on the date fixed for such
         determination, and

                  (ii)     the denominator of which shall be the Current Market
         Price per share of the Common Stock on such date less the then Fair
         Market Value (as determined by the Board of Directors, whose
         determination shall be conclusive and described in a Board Resolution)
         on such date of the portion of the evidences of indebtedness, shares of
         capital stock, securities, cash or other property so distributed
         applicable to one share of Common Stock,

such adjustment to become effective immediately prior to the opening of business
on the Business Day following the date fixed for the determination of
stockholders entitled to receive such distribution; provided, however, that in
the event that the Company makes a distribution to all holders of its Common
Stock consisting of capital stock of, or similar equity interests in, a
subsidiary or other business unit of the Company, the Conversion Rate shall be
adjusted by multiplying the Conversion Rate in effect immediately prior to the
close of business on the date fixed for the determination of stockholders
entitled to receive such distribution by a fraction of which the numerator shall
be the Spin-off Market Price per share of the Common Stock plus the Spin-off
Market Price per share or similar equity interest of the subsidiary or other
business unit of the Company on such date and the denominator shall be the
Spin-off Market Price per share of the Common Stock on the date fixed for such
determination, such adjustment to become effective ten (10) consecutive Trading
Days after the effective date of such distribution of capital stock of, or
similar equity interest in, a subsidiary or other business unit of the Company.
In any case in which this Section 15.05(d) is applicable, Section 15.05(a) and
(b) shall not be applicable. If such dividend or distribution is not so paid or
made, the Conversion Rate shall again be adjusted to be the Conversion Rate that
would then be in effect if such dividend or distribution had not been declared.

         (e)      In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock distributions consisting
exclusively of cash (excluding (i) any dividend or distribution in connection
with the liquidation, dissolution or winding up of the Company, whether
voluntary or involuntary and (ii) any dividend or distribution paid after
October 1, 2008 to the extent that the aggregate amount of such payment per
share of Common Stock in any twelve month period does not exceed 5% of the
arithmetic average of the Last Reported Sale Price of the Common Stock during
the ten (10) consecutive Trading Days immediately prior to the date of the
declaration of the dividend or distribution), then, immediately after the close
of business on such date for determination, the Conversion Rate shall be
increased so that the same shall equal the rate determined by multiplying the
Conversion Rate in effect immediately prior to the close of business on the date
fixed for determination of the stockholders entitled to receive such
distribution by a fraction:

                  (i)      the numerator of which shall be equal to the Current
         Market Price per share of the Common Stock on such date fixed for
         determination; and

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                  (ii)     the denominator of which shall be equal to the
         Current Market Price per share of the Common Stock on such date fixed
         for such determination less the amount of such distribution of cash
         applicable to one share of Common Stock that exceeds the amount of
         dividends and distributions permitted to be excluded pursuant to this
         Section 15.05(e).

         (f)      In case a tender or exchange offer made by the Company or any
subsidiary of the Company for all or any portion of the Common Stock shall
expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to stockholders of consideration per share of
Common Stock having a Fair Market Value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a resolution
of the Board of Directors) that as of the last time (the "EXPIRATION TIME")
tenders or exchanges may be made pursuant to such tender or exchange offer (as
it may be amended) exceeds the Last Reported Sale Price of a share of Common
Stock on the Trading Day next succeeding the Expiration Time, the Conversion
Rate shall be increased so that the same shall equal the rate determined by
multiplying the Conversion Rate in effect immediately prior to the Expiration
Time by a fraction:

                  (i)      the numerator of which shall be the sum of (x) the
         Fair Market Value (determined as aforesaid) of the aggregate
         consideration payable to stockholders based on the acceptance (up to
         any maximum specified in the terms of the tender or exchange offer) of
         all shares validly tendered or exchanged and not withdrawn as of the
         Expiration Time (the shares deemed so accepted up to any such maximum,
         being referred to as the "PURCHASED SHARES") and (y) the product of the
         number of shares of Common Stock outstanding (less any Purchased
         Shares) at the Expiration Time and the Last Reported Sale Price of a
         share of Common Stock on the Trading Day next succeeding the Expiration
         Time, and

                  (ii)     the denominator of which shall be the number of
         shares of Common Stock outstanding (including any tendered or exchanged
         shares) at the Expiration Time multiplied by the Last Reported Sale
         Price of a share of Common Stock on the Trading Day next succeeding the
         Expiration Time,

such adjustment to become effective immediately prior to the opening of business
on the day following the Expiration Time. If the Company is obligated to
purchase shares pursuant to any such tender or exchange offer, but the Company
is permanently prevented by applicable law from effecting any such purchases or
all such purchases are rescinded, the Conversion Rate shall again be adjusted to
be the Conversion Rate that would then be in effect if such tender or exchange
offer had not been made.

         (g)      The reclassification of Common Stock into securities other
than Common Stock (other than any reclassification upon an event to which
Section 15.06 applies) shall be deemed to involve (a) a distribution of such
securities other than Common Stock to all holders of Common Stock (and the
effective date of such reclassification shall be deemed to be "THE DATE FIXED
FOR THE DETERMINATION OF STOCKHOLDERS ENTITLED TO RECEIVE SUCH DISTRIBUTION" and
the "DATE FIXED FOR SUCH DETERMINATION" within the meaning of Section 15.05(d)),
and (b) a subdivision, split or combination, as the case may be, of the number
of shares of Common Stock outstanding

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immediately prior to such reclassification into the number of shares of Common
Stock outstanding immediately thereafter (and the effective date of such
reclassification shall be deemed to be "THE DAY UPON WHICH SUCH SUBDIVISION OR
SPLIT BECOMES EFFECTIVE" or "THE DAY UPON WHICH SUCH COMBINATION BECOMES
EFFECTIVE," as the case may be, and "THE DAY UPON WHICH SUCH SUBDIVISION, SPLIT
OR COMBINATION BECOMES EFFECTIVE" within the meaning of Section 15.05(c)).

         (h)      Notwithstanding the foregoing provisions of Section 15.05, no
adjustment shall be made thereunder, nor shall an adjustment be made to the
ability of a holder of a Debenture to convert, for any distribution described
therein if the holder will otherwise participate in the distribution without
conversion of such holder's Debentures.

         (i)      The Company may make such increases in the Conversion Rate, in
addition to those required by clauses (a) through (g) of this Section 15.05 as
the Board of Directors considers to be advisable to avoid or diminish any income
tax to holders of Common Stock or rights to purchase Common Stock resulting from
any dividend or distribution of stock (or rights to acquire stock) or from any
event treated as such for income tax purposes.

         To the extent permitted by applicable law, the Company from time to
time may increase the Conversion Rate by any amount for any period of time if
the period is at least twenty (20) days, the increase is irrevocable during the
period and the Board of Directors shall have made a determination that such
increase would be in the best interests of the Company, which determination
shall be conclusive. Whenever the Conversion Rate is increased pursuant to the
preceding sentence, the Company shall mail to holders of record of the
Debentures a notice of the increase at least fifteen (15) days prior to the date
the increased Conversion Rate takes effect, and such notice shall state the
increased Conversion Rate and the period during which it will be in effect.

         (j)      No adjustment to the Conversion Rate need be made:

                  (i)      upon the issuance of any shares of Common Stock
         pursuant to any present or future plan providing for the reinvestment
         of dividends or interest payable on securities of the Company and the
         investment of additional optional amounts in shares of Common Stock
         under any plan;

                  (ii)     upon the issuance of any shares of Common Stock or
         options or rights to purchase those shares pursuant to any present or
         future employee, director or consultant benefit plan or program of or
         assumed by the Company or any of its subsidiaries;

                  (iii)    upon the issuance of any shares of Common Stock
         pursuant to any option, warrant, right, or exercisable, exchangeable or
         convertible security not described in (ii) above and outstanding as of
         the Original Issuance Date;

                  (iv)     for a change in the par value of the Common Stock; or

                  (v)      for accrued and unpaid interest, if any.

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         (k)      No adjustment in the Conversion Rate shall be required unless
such adjustment would require an increase or decrease of at least 1% in such
rate; provided that any adjustments that by reason of this Section 15.05(k) are
not required to be made shall be carried forward and taken into account in any
subsequent adjustment. All calculations under this Article 15 shall be made by
the Company and shall be made to the nearest cent or to the nearest one-ten
thousandth (1/10,000) of a share, as the case may be.

         (l)      Whenever the Conversion Rate is adjusted as herein provided,
the Company shall promptly file with the Trustee and any Conversion Agent other
than the Trustee an Officers' Certificate setting forth the Conversion Rate
after such adjustment and setting forth a brief statement of the facts requiring
such adjustment. Unless and until a Responsible Officer of the Trustee shall
have received such Officers' Certificate, the Trustee shall not be deemed to
have knowledge of any adjustment of the Conversion Rate and may assume that the
last Conversion Rate of which it has knowledge is still in effect. Promptly
after delivery of such certificate, the Company shall prepare a notice of such
adjustment of the Conversion Rate setting forth the adjusted Conversion Rate and
the date on which each adjustment becomes effective and shall mail such notice
of such adjustment of the Conversion Rate to the holder of each Debenture at its
last address appearing on the Debenture Register provided for in Section 2.05 of
this Indenture, within twenty (20) days after execution thereof. Failure to
deliver such notice shall not affect the legality or validity of any such
adjustment.

         (m)      In any case in which this Section 15.05 provides that an
adjustment shall become effective immediately after (1) a record date or Stock
Record Date for an event, (2) the date fixed for the determination of
stockholders entitled to receive a dividend or distribution pursuant to Section
15.05(a), (3) a date fixed for the determination of stockholders entitled to
receive rights or warrants pursuant to Section 15.05(b) or (4) the Expiration
Time for any tender or exchange offer pursuant to Section 15.05(f), (each a
"DETERMINATION DATE"), the Company may elect to defer until the occurrence of
the applicable Adjustment Event (as hereinafter defined) (x) issuing to the
holder of any Debenture converted after such Determination Date and before the
occurrence of such Adjustment Event, the additional shares of Common Stock or
other securities issuable upon such conversion by reason of the adjustment
required by such Adjustment Event over and above the Common Stock issuable upon
such conversion before giving effect to such adjustment and (y) paying to such
holder any amount in cash in lieu of any fraction pursuant to Section 15.03;
provided that in the case of an adjustment made pursuant to Section 15.05(d)
with respect to a distribution of shares of capital stock of, or similar equity
interest in, a subsidiary or other business unit of the Company, the Company may
defer the issuance of such additional shares and cash payment, if any, until the
third Business Day immediately following the last day of the 20 consecutive
Trading Day period commencing on the fifth Trading Day after the Ex-Dividend
Date. For purposes of this Section 15.05(m), the term "ADJUSTMENT EVENT" shall
mean:

                  (i)      in any case referred to in clause (1) hereof, the
         occurrence of such event;

                  (ii)     in any case referred to in clause (2) hereof, the
         date any such dividend or distribution is paid or made;

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                  (iii)    in any case referred to in clause (3) hereof, the
         date of expiration of such rights or warrants; and

                  (iv)     in any case referred to in clause (4) hereof, the
         date a sale or exchange of Common Stock pursuant to such tender or
         exchange offer is consummated and becomes irrevocable.

         (n)      For purposes of this Section 15.05, the number of shares of
Common Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of shares of Common Stock. The Company
will not pay any dividend or make any distribution on shares of Common Stock
held in the treasury of the Company.

         Section 15.06. Effect of Reclassification, Consolidation, Merger or
Sale. If any of the following events occur, namely (i) any reclassification or
change of the outstanding shares of Common Stock (other than a subdivision or
combination to which Section 15.05(c) applies), (ii) any consolidation, merger
or combination of the Company with another Person as a result of which holders
of Common Stock shall be entitled to receive stock, other securities or other
property or assets (including cash) with respect to or in exchange for such
Common Stock, or (iii) any sale or conveyance of all or substantially all of the
properties and assets of the Company to any other Person as a result of which
holders of Common Stock shall be entitled to receive stock, other securities or
other property or assets (including cash) with respect to or in exchange for
such Common Stock, then the Company or the successor or purchasing Person, as
the case may be, shall execute with the Trustee a supplemental indenture (which
shall comply with the Trust Indenture Act as in force at the date of execution
of such supplemental indenture) providing that each Debenture shall be
convertible into the kind and amount of shares of stock, other securities or
other property or assets (including cash) receivable upon such reclassification,
change, consolidation, merger, combination, sale or conveyance by a holder of a
number of shares of Common Stock issuable upon conversion of such Debentures
(assuming, for such purposes, a sufficient number of authorized shares of Common
Stock are available to convert all such Debentures) immediately prior to such
reclassification, change, consolidation, merger, combination, sale or conveyance
assuming such holder of Common Stock did not exercise his rights of election, if
any, as to the kind or amount of stock, other securities or other property or
assets (including cash) receivable upon such reclassification, change,
consolidation, merger, combination, sale or conveyance (provided that, if the
kind or amount of stock, other securities or other property or assets (including
cash) receivable upon such reclassification, change, consolidation, merger,
combination, sale or conveyance is not the same for each share of Common Stock
in respect of which such rights of election shall not have been exercised
("NON-ELECTING SHARE"), then for the purposes of this Section 15.06 the kind and
amount of stock, other securities or other property or assets (including cash)
receivable upon such reclassification, change, consolidation, merger,
combination, sale or conveyance 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). Such supplemental indenture shall provide for adjustments
which shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Article 15.

         The Company shall cause notice of the execution of such supplemental
indenture to be mailed to each holder of Debentures, at its address appearing on
the Debenture Register provided

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for in Section 2.05 of this Indenture, within twenty (20) days after execution
thereof. Failure to deliver such notice shall not affect the legality or
validity of such supplemental indenture.

         The above provisions of this Section shall similarly apply to
successive reclassifications, changes, consolidations, mergers, combinations,
sales and conveyances.

         If this Section 15.06 applies to any event or occurrence, Section 15.05
shall not apply.

         Section 15.07. Taxes on Shares Issued. The issue of stock certificates
on conversions of Debentures shall be made without charge to the converting
Debentureholder for any documentary, stamp or similar issue or transfer tax in
respect of the issue thereof. 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 and delivery of stock in any name other than that of the holder of any
Debenture converted, and the Company shall not be required to issue or deliver
any such stock certificate unless and until the Person or Persons requesting the
issue thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.

         Section 15.08. Reservation of Shares, Shares to Be Fully Paid;
Compliance with Governmental Requirements; Listing of Common Stock. The Company
shall provide, free from preemptive rights, out of its authorized but unissued
shares or shares held in treasury, sufficient shares of Common Stock to provide
for the conversion of the Debentures from time to time as such Debentures are
presented for conversion.

         Before taking any action which would cause an adjustment increasing the
Conversion Rate to an amount that would cause the Conversion Price to be reduced
below the then par value, if any, of the shares of Common Stock issuable upon
conversion of the Debentures, the Company will take all corporate action which
may, in the opinion of its counsel, be necessary in order that the Company may
validly and legally issue shares of such Common Stock at such adjusted
Conversion Rate.

         The Company covenants that all shares of Common Stock which may be
issued upon conversion of Debentures will upon issue be fully paid and
nonassessable by the Company and free from all taxes, Liens and charges with
respect to the issue thereof.

         The Company covenants that, if any shares of Common Stock to be
provided for the purpose of conversion of Debentures hereunder require
registration with or approval of any governmental authority under any federal or
state law before such shares may be validly issued upon conversion, the Company
will in good faith and as expeditiously as possible, to the extent then
permitted by the rules and interpretations of the Commission (or any successor
thereto), endeavor to secure such registration or approval, as the case may be.

         The Company further covenants that, if at any time the Common Stock
shall be listed on the Nasdaq National Market or any other national securities
exchange or automated quotation system, the Company will, if permitted by the
rules of such exchange or automated quotation system, list and keep listed, so
long as the Common Stock shall be so listed on such exchange or automated
quotation system, all Common Stock issuable upon conversion of the Debenture;
provided that if the rules of such exchange or automated quotation system permit
the Company

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to defer the listing of such Common Stock until the first conversion of the
Debentures into Common Stock in accordance with the provisions of this
Indenture, the Company covenants to list such Common Stock issuable upon
conversion of the Debentures in accordance with the requirements of such
exchange or automated quotation system at such time.

         Section 15.09. Responsibility of Trustee. The Trustee and any other
Conversion Agent shall not at any time be under any duty or responsibility to
any holder of Debentures to determine the Conversion Rate or whether any facts
exist which may require any adjustment of the Conversion Rate, or with respect
to the nature or extent or calculation of any such adjustment when made, or with
respect to the method employed, or herein or in any supplemental indenture
provided to be employed, in making the same. The Trustee and any other
Conversion Agent shall not be accountable with respect to the validity or value
(or the kind or amount) of any shares of Common Stock, or of any securities or
property, which may at any time be issued or delivered upon the conversion of
any Debenture; and the Trustee and any other Conversion Agent make no
representations with respect thereto. Neither the Trustee nor any Conversion
Agent shall be responsible for any failure of the Company to issue, transfer or
deliver any shares of Common Stock or stock certificates or other securities or
property or cash upon the surrender of any Debenture for the purpose of
conversion or to comply with any of the duties, responsibilities or covenants of
the Company contained in this Article 15. Without limiting the generality of the
foregoing, neither the Trustee nor any Conversion Agent shall be under any
responsibility to determine the correctness of any provisions contained in any
supplemental indenture entered into pursuant to Section 15.06 relating either to
the kind or amount of shares of stock or securities or property (including cash)
receivable by Debentureholders upon the conversion of their Debentures after any
event referred to in such Section 15.06 or to any adjustment to be made with
respect thereto, but, subject to the provisions of Section 8.01, may accept as
conclusive evidence of the correctness of any such provisions, and shall be
protected in relying upon, the Officers' Certificate (which the Company shall be
obligated to file with the Trustee prior to the execution of any such
supplemental indenture) with respect thereto.

         Section 15.10. Notice to Holders Prior to Certain Actions. In case:

                  (a)      the Company shall declare a dividend (or any other
         distribution) on its Common Stock that would require an adjustment in
         the Conversion Rate pursuant to Section 15.05; or

                  (b)      the Company shall authorize the granting to the
         holders of all or substantially all of its Common Stock of rights or
         warrants to subscribe for or purchase any share of any class or any
         other rights or warrants; or

                  (c)      of any reclassification or reorganization of the
         Common Stock of the Company (other than a subdivision or combination of
         its outstanding Common Stock, or a change in par value, or from par
         value to no par value, or from no par value to par value), or of any
         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 transfer of all or substantially all of the assets of the Company;
         or

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

the Company shall cause to be filed with the Trustee and to be mailed to each
holder of Debentures at its address appearing on the Debenture Register provided
for in Section 2.05 of this Indenture, as promptly as possible but in any event
at least ten (10) 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
such dividend, distribution or rights or warrants, or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be entitled
to such dividend, distribution or rights are to be determined, or (y) the date
on which such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up is expected to become effective or occur,
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,
transfer, dissolution, liquidation or winding up. Failure to give such notice,
or any defect therein, shall not affect the legality or validity of such
dividend, distribution, reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up.

         Section 15.11. Stockholder Rights Plans. If the rights provided for in
the existing rights plan adopted by the Company have separated from the shares
of Common Stock in accordance with the provisions of the applicable stockholder
rights agreement so that the holders of the Debentures would not be entitled to
receive any rights in respect of Common Stock issuable upon conversion of the
Debentures, the conversion rate will be adjusted as if the Company distributed
to all holders of Common Stock shares of the Company's capital stock, evidences
of indebtedness or assets (including securities but excluding rights or warrants
to purchase Common Stock issued to all holders of Common Stock, Common Stock
issued as a dividend or distribution on Common Stock and cash distributions),
subject to readjustment in the event of the expiration, termination or
redemption of the rights. In lieu of any such adjustment, the Company may amend
such applicable stockholder rights agreement to provide that upon conversion of
the Debentures the holders will receive, in addition to the Common Stock
issuable upon such conversion, the rights which would have attached to such
Common Stock if the rights had not become separated from the Common Stock under
such applicable stockholder rights agreement. To the extent that the Company
adopts any future rights plan, upon conversion of the Debentures into Common
Stock, holders of Debentures shall receive, in addition to Common Stock, the
rights under the future rights plan whether or not the rights have separated
from the Common Stock at the time of conversion and no adjustment will be made
in accordance with Section 15.05(d).

                                   ARTICLE 16
                            MISCELLANEOUS PROVISIONS

         Section 16.01. Confidentiality Exception. Notwithstanding any other
provision of this Indenture, each Debentureholder (and each employee,
representative or other agent of such Debentureholder) may disclose to any and
all persons, without limitation of any kind, the tax treatment and tax structure
(as such terms are used in Sections 6011, 6111 and 6112 of the Code and the
Treasury Regulations promulgated thereunder) of the Debentures and all materials
of any kind (including opinions or other tax analyses) that are provided
relating to such tax treatment

                                       86

<PAGE>

and tax structure, other than any information for which nondisclosure is
reasonably necessary in order to comply with applicable securities laws, and the
ability of the Company, its subsidiaries and their respective representatives,
affiliates, employees, officers, directors or other agents to consult any tax
advisor, including an independent tax advisor, regarding the tax treatment or
tax structure of the Debentures (and any transactions related thereto) shall not
be restricted in any manner.

         Section 16.02. Provisions Binding on Company's Successors. All the
covenants, stipulations, promises and agreements by the Company contained in
this Indenture shall bind its successors and assigns whether so expressed or
not.

         Section 16.03. Official Acts by Successor Corporation. Any act or
proceeding by any provision of this Indenture authorized or required to be done
or performed by any board, committee or officer of the Company shall and may be
done and performed with like force and effect by the like board, committee or
officer of any Person that shall at the time be the lawful sole successor of the
Company.

         Section 16.04. Addresses for Notices, Etc. Any notice or demand which
by any provision of this Indenture is required or permitted to be given or
served by the Trustee or by the holders of Debentures on the Company shall be
deemed to have been sufficiently given or made, for all purposes, if given or
served by being deposited postage prepaid by registered or certified mail in a
post office letter box or sent by telecopier transmission addressed as follows:
Quanta Services, Inc., 1360 Post Oak Boulevard, Suite 2100, Houston, TX 77056,
Attention: Chief Financial Officer. Any notice, direction, request or demand
hereunder to or upon the Trustee shall be deemed to have been sufficiently given
or made, for all purposes, if given or served by being deposited, postage
prepaid, by registered or certified mail in a post office letter box or sent by
telecopier transmission addressed to the Corporate Trust Office of the Trustee.

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

         Any notice or communication mailed to a Debentureholder shall be mailed
to him by first class mail, postage prepaid, at his address as it appears on the
Debenture Register and shall be sufficiently given to him if so mailed within
the time prescribed.

         Failure to mail a notice or communication to a Debentureholder or any
defect in it shall not affect its sufficiency with respect to other
Debentureholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.

         Section 16.05. Governing Law. This Indenture and each Debenture shall
be deemed to be a contract made under the laws of the State of New York, and for
all purposes shall be construed in accordance with the laws of the State of New
York (including Section 5-1401 of the New York General Obligations Law or any
successor to such statute).

         Section 16.06. Evidence of Compliance with Conditions Precedent,
Certificates to Trustee. Upon any application or demand by the Company to the
Trustee to take any action under any of the provisions of this Indenture, the
Company shall furnish to the Trustee an Officers' Certificate stating that all
conditions precedent, if any, provided for in this Indenture

                                       87

<PAGE>

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 have been complied with.

         Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture shall include: (1) a statement that each Person
making such certificate or opinion has read such covenant or condition; (2) a
brief statement as to the nature and scope of the examination or investigation
upon which the statement or opinion contained in such certificate or opinion is
based; (3) a statement that, in the opinion of each such Person, he has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and (4) a statement as to whether or not, in the opinion of each
such Person, such condition or covenant has been complied with.

         Section 16.07. Legal Holidays. In any case in which the date of
maturity of interest on or principal of the Debentures or the Redemption Date of
any Debenture or any Repurchase Date with respect to any Debenture will not be a
Business Day, then payment of such interest on or principal of the Debentures
need not be made on such date, but may be made on the next succeeding Business
Day with the same force and effect as if made on the date of maturity or the
Redemption Date or the Repurchase Date, as the case may be, and no interest
shall accrue for the period from and after such date.

         Section 16.08. Company Responsible for Making Calculations. Unless
otherwise specified in this Indenture, the Company will be responsible for
making all calculations called for under the Debentures. These calculations
include, but are not limited to, determination of the Current Market Price, Last
Reported Sale Price, Market Price and Spin-off Market Price, the amount of
accrued interest payable on the Debentures and the Conversion Rate of the
Debentures. The Company will make these calculations in good faith and, absent
manifest error, these calculations will be final and binding on the
Debentureholders. Promptly after the calculation thereof, the Company will
provide to each of the Trustee and the Conversion Agent an Officers' Certificate
setting forth a schedule of its calculations, and each of the Trustee and the
Conversion Agent is entitled to conclusively rely upon the accuracy of such
calculations without independent verification. The Trustee will forward the
Company's calculations to any holder upon the request of such holder.

         Section 16.09. Trust Indenture Act. This Indenture is hereby made
subject to, and shall be governed by, the provisions of the Trust Indenture Act
required to be part of and to govern indentures qualified under the Trust
Indenture Act; provided that unless otherwise required by law, notwithstanding
the foregoing, this Indenture and the Debentures issued hereunder shall not be
subject to the provisions of subsections (a)(1), (a)(2), and (a)(3) of Section
314 of the Trust Indenture Act as now in effect or as hereafter amended or
modified; provided further that this Section 16.09 shall not require this
Indenture or the Trustee to be qualified under the Trust Indenture Act prior to
the time such qualification is in fact required under the terms of the Trust
Indenture Act, nor shall it constitute any admission or acknowledgment by any
party to the Indenture that any such qualification is required prior to the time
such qualification is in fact required under the terms of the Trust Indenture
Act. If any provision hereof limits, qualifies or conflicts with another
provision hereof which is required to be included in an indenture qualified
under the Trust Indenture Act, such required provision shall control.

                                       88

<PAGE>

         Section 16.10. No Security Interest Created. Except as provided in
Section 8.06, nothing in this Indenture or in the Debentures, expressed or
implied, shall be construed to constitute a security interest under the Uniform
Commercial Code or similar legislation, as now or hereafter enacted and in
effect, in any jurisdiction in which property of the Company or its subsidiaries
is located.

         Section 16.11. Benefits of Indenture. Nothing in this Indenture or in
the Debentures, express or implied, shall give to any Person, other than the
parties hereto, any Paying Agent, any authenticating agent, any Debenture
Registrar and their successors hereunder and the holders of Debentures any
benefit or any legal or equitable right, remedy or claim under this Indenture.

         Section 16.12. Table of Contents, Headings, Etc. The table of contents
and the titles and headings of the Articles and Sections of this Indenture have
been inserted for convenience of reference only, are not to be considered a part
hereof, and shall in no way modify or restrict any of the terms or provisions
hereof.

         Section 16.13. Authenticating Agent. The Trustee may appoint an
authenticating agent that shall be authorized to act on its behalf, and subject
to its direction, in the authentication and delivery of Debentures in connection
with the original issuance thereof and transfers and exchanges of Debentures
hereunder, including under Sections 2.04, 2.05, 2.06, 2.07, 3.02 and 3.08, as
fully to all intents and purposes as though the authenticating agent had been
expressly authorized by this Indenture and those Sections to authenticate and
deliver Debentures. For all purposes of this Indenture, the authentication and
delivery of Debentures by the authenticating agent shall be deemed to be
authentication and delivery of such Debentures "by the Trustee" and a
certificate of authentication executed on behalf of the Trustee by an
authenticating agent shall be deemed to satisfy any requirement hereunder or in
the Debentures for the Trustee's certificate of authentication. Such
authenticating agent shall at all times be a Person eligible to serve as trustee
hereunder pursuant to Section 8.09.

         Any corporation into which any authenticating agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any authenticating agent
shall be a party, or any corporation succeeding to the corporate trust business
of any authenticating agent, shall be the successor of the authenticating agent
hereunder, if such successor corporation is otherwise eligible under this
Section 16.13, without the execution or filing of any paper or any further act
on the part of the parties hereto or the authenticating agent or such successor
corporation.

         Any authenticating agent may at any time resign by giving written
notice of resignation to the Trustee and to the Company. The Trustee may at any
time terminate the agency of any authenticating agent by giving written notice
of termination to such authenticating agent and to the Company. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
any authenticating agent shall cease to be eligible under this Section, the
Trustee shall either promptly appoint a successor authenticating agent or itself
assume the duties and obligations of the former authenticating agent under this
Indenture and, upon such appointment of a successor authenticating agent, if
made, shall give written notice of such appointment of a successor
authenticating agent to the Company and shall mail notice of such appointment of
a

                                       89

<PAGE>

successor authenticating agent to all holders of Debentures as the names and
addresses of such holders appear on the Debenture Register.

         The Company agrees to pay to the authenticating agent from time to time
such reasonable compensation for its services as shall be agreed upon in writing
between the Company and the authenticating agent.

         The provisions of Sections 8.02, 8.03, 8.04 and 9.03 and this Section
16.13 shall be applicable to any authenticating agent.

         Section 16.14. Execution in Counterparts. This Indenture may be
executed in any number of counterparts, each of which shall be an original, but
such counterparts shall together constitute but one and the same instrument.

         Section 16.15. Severability. In case any provision in this Indenture or
in the Debentures shall be invalid, illegal or unenforceable, then (to the
extent permitted by law) the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.

         Wells Fargo Bank, N.A. hereby accepts the trusts in this Indenture
declared and provided, upon the terms and conditions herein above set forth.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

                                       90

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed.

                                  QUANTA SERVICES, INC.

                                  By: /s/ DANA A. GORDON
                                      ------------------------------------------
                                      Name: Dana A. Gordon
                                      Title: Vice President, General Counsel and
                                             Secretary

                                  WELLS FARGO BANK, N.A., as Trustee

                                  By: /s/ MELISSA SCOTT
                                      ------------------------------------------
                                      Name: Melissa Scott
                                      Title: Vice President

                                       91

<PAGE>

                                                                       EXHIBIT A

[Include only for Global Debentures:]

[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (THE
"DEPOSITARY", WHICH TERM INCLUDES ANY SUCCESSOR DEPOSITORY FOR THE CERTIFICATES)
TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND
ANY PAYMENT HEREIN IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE, OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH
AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

[Include only for Debentures that are Restricted Securities:]

[THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY
BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY,
BY ITS ACCEPTANCE HEREOF, (1) REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT ("RULE 144A")); (2)
AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS
PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY OR ANY
COMMON STOCK ISSUABLE UPON CONVERSION OF SUCH SECURITY, PRIOR TO THE EXPIRATION
OF THE HOLDING PERIOD APPLICABLE TO SALES OF THIS SECURITY UNDER RULE 144 UNDER
THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION) ONLY (A) TO THE ISSUER, (B)
PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT (AND WHICH CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH
TRANSFER), (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO
RULE 144A, IN COMPLIANCE WITH RULE 144A TO A PERSON IT REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A OR (D) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT;
SUBJECT TO THE ISSUER'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER PURSUANT TO CLAUSE (D) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR

<PAGE>

OTHER INFORMATION SATISFACTORY TO EACH OF THEM; AND (3) AGREES THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED UPON THE
TRANSFER OF THIS SECURITY PURSUANT TO CLAUSE 2(B) ABOVE OR UNDER RULE 144 UNDER
THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION).]

THE HOLDER OF THIS SECURITY IS ENTITLED TO THE BENEFITS OF A REGISTRATION RIGHTS
AGREEMENT DATED AS OF OCTOBER 17, 2003 AND, BY ITS ACCEPTANCE HEREOF, AGREES TO
BE BOUND BY AND TO COMPLY WITH THE PROVISIONS OF SUCH REGISTRATION RIGHTS
AGREEMENT.

                                      A-2

<PAGE>

                              QUANTA SERVICES, INC.

                4.50% CONVERTIBLE SUBORDINATED DEBENTURE DUE 2023

                                                              CUSIP: 74762E AB 8
                                                              ISIN: US74762EAB83

No. 1                                                               $225,000,000

         Quanta Services, Inc., a corporation duly organized and validly
existing under the laws of the State of Delaware (herein called the "COMPANY",
which term includes any successor corporation under the Indenture referred to on
the reverse hereof), for value received, hereby promises to pay to CEDE & CO. or
its registered assigns [the principal sum of TWO HUNDRED AND TWENTY-FIVE MILLION
DOLLARS] [the principal sum set forth on Schedule I hereto]1 on October 1, 2023
at the office or agency of the Company maintained for that purpose in accordance
with the terms of the Indenture, in such coin or currency of the United States
of America as at the time of payment shall be legal tender for the payment of
public and private debts, and to pay interest, semiannually on April 1 and
October 1 of each year, commencing April 1, 2004, on said principal sum at said
office or agency, in like coin or currency, at the rate per annum of 4.50% from
the later of October 17, 2003 or the most recent date to which interest has been
duly paid or provided for until payment of said principal sum has been made or
duly provided for; provided that if the Company shall default in the payment of
interest due on such April 1 or October 1, then this Debenture shall bear
interest from the next preceding April 1 or October 1 to which interest has been
paid or duly provided for; and provided further that if no interest has been
paid or duly provided for on this Debenture, then this Debenture shall bear
interest from October 17, 2003. Except as otherwise provided in the Indenture,
the interest payable on the Debenture pursuant to the Indenture on any April 1
or October 1 will be paid to the Person entitled thereto as it appears in the
Debenture Register at the close of business on the Regular Record Date, which
shall be the March 15 or September 15 (whether or not a Business Day) next
preceding such April 1 or October 1, as provided in the Indenture; provided that
any such interest not punctually paid or duly provided for shall be payable as
provided in the Indenture. The Company shall pay interest (i) on any Debentures
in certificated form by check mailed to the address of the Person entitled
thereto as it appears in the Debenture Register (or, upon written notice, by
wire transfer in immediately available funds, if such Person is entitled to
interest on Debentures with an aggregate principal amount in excess of
$2,000,000) or (ii) on any Global Debenture by wire transfer of immediately
available funds to the account of the Depositary or its nominee.

         The Company promises to pay interest on overdue principal and (to the
extent that payment of such interest is enforceable under applicable law)
interest at the rate of 4.50% per annum, compounded semiannually.

         Reference is made to the further provisions of this Debenture set forth
on the reverse hereof, including, without limitation, provisions giving the
holder of this Debenture the right to convert this Debenture into Common Stock
of the Company on the terms and subject to the

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

(1) For Global Debentures only.

                                      A-3

<PAGE>

limitations referred to on the reverse hereof and as more fully specified in the
Indenture. Under the circumstances described in the Indenture, the Company may
fulfill all or part of its conversion obligation by delivering cash in lieu of
Common Stock.

         This Debenture shall be deemed to be a contract made under the laws of
the State of New York, and for all purposes shall be construed in accordance
with and governed by the laws of the State of New York (including Section 5-1401
of the New York General Obligations Law or any successor to such statute).

         This Debenture shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been manually signed
by the Trustee or a duly authorized authenticating agent under the Indenture.

                                      A-4

<PAGE>

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

                                 QUANTA SERVICES, INC.

                                 By: ___________________________________________
                                     Dana A. Gordon
                                     Vice President, General Counsel & Secretary

October 17, 2003

TRUSTEE'S CERTIFICATE OF AUTHENTICATION

This is one of the Debentures described in the within-named Indenture.

WELLS FARGO BANK, N.A.,
     as Trustee

By: ____________________________________
    Authorized Signatory

                                , or

By: ____________________________________
    As Authenticating Agent
    (if different from Trustee)

         By: ____________________________
             Authorized Signatory

                                      A-5

<PAGE>

                          FORM OF REVERSE OF DEBENTURE

                              QUANTA SERVICES, INC.

                4.50% CONVERTIBLE SUBORDINATED DEBENTURE DUE 2023

         This Debenture is one of a duly authorized issue of Debentures of the
Company, designated as its 4.50% Convertible Subordinated Debentures due 2023
(herein called the "DEBENTURES"), limited in aggregate principal amount to
$270,000,000, issued and to be issued under and pursuant to an Indenture dated
as of October 17, 2003 (herein called the "INDENTURE"), between the Company and
Wells Fargo Bank, N.A., as trustee (herein called the "TRUSTEE"), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
description of the rights, limitations of rights, obligations, duties and
immunities thereunder of the Trustee, the Company and the holders of the
Debentures.

         In case an Event of Default shall have occurred and be continuing, the
principal of and accrued interest on all Debentures may be declared by either
the Trustee or the holders of not less than 25% in aggregate principal amount of
the Debentures then outstanding, and upon said declaration shall become, due and
payable, in the manner, with the effect and subject to the conditions provided
in the Indenture.

         The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of at least a majority in aggregate
principal amount of the Debentures at the time outstanding, to execute
supplemental indentures adding any provisions to or changing in any manner or
eliminating any of the provisions of the Indenture or of any supplemental
indenture or modifying in any manner the rights of the holders of the
Debentures; provided that no such supplemental indenture shall (i) extend the
Stated Maturity of any Debenture, or reduce the rate or extend the time of
payment of interest thereon, or reduce the principal amount thereof or reduce
any amount payable upon redemption or repurchase thereof, or impair the right of
any Debentureholder to institute suit for the payment thereof, or make the
principal thereof or interest thereon payable in any coin or currency other than
that provided in the Debentures, or change the obligation of the Company to
redeem any Debenture on a Redemption Date in a manner adverse to the holder of
the Debentures, or change the obligation of the Company to repurchase any
Debenture upon a Fundamental Change in a manner adverse to the holder of the
Debentures, or change the obligation of the Company to repurchase any Debenture
on a Company Repurchase Date in a manner adverse to the holder of the
Debentures, or impair the right to convert the Debentures into Common Stock
subject to the terms set forth in the Indenture, including Section 15.06
thereof, or reduce the number of shares of Common Stock or other property
receivable upon conversion, in each case without the consent of the holder of
each Debenture so affected, or modify any of the provisions of Section 11.02 or
Section 7.07 thereof, except to increase any such percentage or to provide that
certain other provisions of the Indenture cannot be modified or waived without
the consent of the holder of each Debenture so affected, or change any
obligation of the Company to maintain an office or agency in the places and for
the purposes set forth in Section 5.02 thereof, or reduce the quorum or voting
requirements set forth in Article 10 or (ii) reduce the aforesaid percentage of
Debentures, the holders of which are required to consent to any such
supplemental indenture, without the consent of the holders of all Debentures
then outstanding. Subject to the provisions of the Indenture, the holders of a

                                      A-6

<PAGE>

majority in aggregate principal amount of the Debentures at the time outstanding
may on behalf of the holders of all of the Debentures waive any past default or
Event of Default under the Indenture and its consequences except (A) a default
in the payment of interest on or the principal of any of the Debentures, (B) a
failure by the Company to convert any Debentures into Common Stock, (C) a
default in the payment of the Redemption Price pursuant to Article 3 of the
Indenture, (D) a default in the payment of the Company Repurchase Price or
Fundamental Change Repurchase Price pursuant to Article 3 of the Indenture or
(E) a default in respect of a covenant or provisions of the Indenture which
under Article 11 of the Indenture cannot be modified or amended without the
consent of the holders of each or all Debentures then outstanding or affected
thereby. Any such consent or waiver by the holder of this Debenture (unless
revoked as provided in the Indenture) shall be conclusive and binding upon such
holder and upon all future holders and owners of this Debenture and any
Debentures which may be issued in exchange or substitution hereof, irrespective
of whether or not any notation thereof is made upon this Debenture or such other
Debentures.

         No reference herein to the Indenture and no provision of this Debenture
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of and interest on this
Debenture at the place, at the respective times, at the rate and in the coin or
currency herein prescribed.

         Interest on the Debentures shall be computed on the basis of a 360-day
year of twelve 30-day months.

         The Debentures are issuable in fully registered form, without coupons,
in denominations of $1,000 principal amount and any multiple of $1,000. At the
office or agency of the Company referred to on the face hereof, and in the
manner and subject to the limitations provided in the Indenture, without payment
of any service charge but with payment of a sum sufficient to cover any tax,
assessment or other governmental charge that may be imposed in connection with
any registration or exchange of Debentures, Debentures may be exchanged for a
like aggregate principal amount of Debentures of any other authorized
denominations.

         At any time on or after October 8, 2008 and prior to maturity, the
Debentures may be redeemed at the option of the Company, in whole or in part, in
cash upon mailing a notice of such redemption not less than thirty (30) days but
not more than sixty (60) days before the Redemption Date to the holders of
Debentures at their last registered addresses, all as provided in the Indenture,
at a Redemption Price equal to 100% of the principal amount of Debentures being
redeemed plus accrued and unpaid interest to, but excluding, the Redemption
Date; provided that if the Redemption Date is on April 1 or October 1, then the
interest payable on such date shall be paid to the holder of record on the
preceding March 15 or September 15, respectively.

         In no event will any Debenture be redeemable at the option of the
Company before October 8, 2008.

         The Company may not give notice of any redemption of the Debentures if
a default in the payment of interest on the Debentures has occurred and is
continuing.

         The Debentures are not subject to redemption through the operation of
any sinking fund.

                                      A-7

<PAGE>

         If a Fundamental Change occurs at any time prior to maturity of the
Debentures, this Debenture will be redeemable on a Fundamental Change Repurchase
Date, specified by the Company, which shall be no later than thirty-five (35)
Business Days after the occurrence of such Fundamental Change, at the option of
the holder of this Debenture at a Fundamental Change Repurchase Price equal to
100% of the principal amount thereof, together with accrued interest to (but
excluding) the Fundamental Change Repurchase Date; provided that if such
Fundamental Change Repurchase Date falls after a record date and on or prior to
the corresponding Interest Payment Date, the interest payable on such Interest
Payment Date shall be paid to the holder of record of this Debenture on the
preceding March 15 or September 15, respectively. The Debentures will be
redeemable in multiples of $1,000 principal amount. The Company shall mail to
all holders of record of the Debentures a notice of the occurrence of a
Fundamental Change and of the repurchase right arising as a result thereof on or
before the twenty-fifth (25th) Business Day prior to each Fundamental Change
Repurchase Date. For a Debenture to be so repurchased at the option of the
holder, the Company must receive at the office or agency of the Company
maintained for that purpose in accordance with the terms of the Indenture, such
Debenture with the form entitled "FORM OF FUNDAMENTAL CHANGE REPURCHASE
ELECTION" on the reverse hereof duly completed, together with such Debenture,
duly endorsed for transfer, on or before the close of business on the Business
Day immediately preceding the Fundamental Change Repurchase Date.

         Subject to the terms and conditions of the Indenture, the Company shall
become obligated to repurchase, at the option of the holder, all or any portion
of the Debentures held by such holder on October 1, 2008, October 1, 2013, and
October 1, 2018 in integral multiples of $1,000 at a Company Repurchase Price of
100% of the principal amount, plus any accrued and unpaid interest on such
Debenture to but excluding the Company Repurchase Date. To exercise such right,
a holder shall deliver to the Company such Debenture with the form entitled
"FORM OF COMPANY REPURCHASE ELECTION" on the reverse hereof duly completed,
together with the Debenture, duly endorsed for transfer, at any time from the
opening of business on the date that is twenty (20) Business Days prior to such
Company Repurchase Date until the close of business on the Business Day
immediately preceding the Company Repurchase Date, and shall deliver the
Debentures to the Trustee (or other Paying Agent appointed by the Company) as
set forth in the Indenture.

         The Company Repurchase Price with respect to the Company Repurchase
Date occurring on October 1, 2008 shall be paid only in cash. The Company
Repurchase Price to be paid on any of October 1, 2013 or October 1, 2018 and the
Fundamental Change Repurchase Price to be paid on any Fundamental Change
Repurchase Date may be paid, at the option of the Company, in cash or by the
issuance and delivery of shares of Common Stock, or in any combination thereof,
subject to the terms and conditions of the Indenture.

         Holders have the right to withdraw any Repurchase Election by
delivering to the Trustee (or other Paying Agent appointed by the Company) a
written notice of withdrawal up to the close of business on the Business Day
immediately preceding the Repurchase Date, all as provided in the Indenture.

         If cash or securities sufficient to pay the Repurchase Price with
respect to all Debentures or portions thereof to be repurchased as of any
Repurchase Date are deposited with the Trustee

                                      A-8

<PAGE>

(or other Paying Agent appointed by the Company), then on and after such
Repurchase Date, interest will cease to accrue on such Debentures (or portions
thereof), and the holder thereof shall have no other rights as such other than
the right to receive the Repurchase Price upon surrender of such Debenture.

         Subject to the occurrence of certain events and in compliance with the
provisions of the Indenture, prior to the Stated Maturity of the Debentures, the
holder hereof has the right, at its option, to convert each $1,000 principal
amount of the Debentures into 89.7989 shares of the Company's Common Stock (at a
Conversion Price of approximately $11.14 per share), as such shares shall be
constituted at the date of conversion and subject to adjustment from time to
time as provided in the Indenture, upon surrender of this Debenture with the
form entitled "FORM OF CONVERSION NOTICE" on the reverse hereof duly completed,
to the Company at the office or agency of the Company maintained for that
purpose in accordance with the terms of the Indenture or, at the option of such
holder, the Corporate Trust Office, and, unless the shares issuable on
conversion are to be issued in the same name as this Debenture, duly endorsed
by, or accompanied by instruments of transfer in form satisfactory to the
Company duly executed by, the holder or by his duly authorized attorney. The
Company will notify the holder thereof of any event triggering the right to
convert the Debentures as specified above in accordance with the Indenture.

         If the Company (i) is a party to a consolidation, merger, statutory
share exchange or combination, (ii) reclassifies the Common Stock or (iii) sells
or conveys its properties and assets substantially as an entirety to any Person,
the right to convert a Debenture into shares of Common Stock may be changed into
a right to convert it into securities, cash or other assets of the Company or
such other Person, in each case in accordance with the Indenture.

         No adjustment in respect of interest on any Debenture converted or
dividends on any shares issued upon conversion of such Debenture will be made
upon any conversion except as set forth in the next sentence. If this Debenture
(or portion hereof) is surrendered for conversion during the period from the
close of business on any record date for the payment of interest to the close of
business on the Business Day preceding the following Interest Payment Date and
has not been called for redemption by the Company on a Redemption Date that
occurs during such period, this Debenture (or portion hereof being converted)
must be accompanied by payment, in immediately available funds or other funds
acceptable to the Company, of an amount equal to the interest otherwise payable
on such Interest Payment Date on the principal amount being converted; provided
that no such payment shall be required (1) if the Company has specified a
Redemption Date that is after a record date and prior to the next Interest
Payment Date, (2) if the Company has specified a Repurchase Date following a
Fundamental Change that is during such period or (3) to the extent of any
overdue interest, if any overdue interest exists at the time of conversion with
respect to such Debenture.

         No fractional shares will be issued upon any conversion, but an
adjustment and payment in cash will be made, as provided in the Indenture, in
respect of any fraction of a share which would otherwise be issuable upon the
surrender of any Debenture or Debentures for conversion.

                                      A-9

<PAGE>

         A Debenture in respect of which a holder is exercising its right to
require repurchase upon a Fundamental Change or repurchase on a Repurchase Date
may be converted only if such holder withdraws its election to exercise such
right in accordance with the terms of the Indenture.

         Any Debentures called for redemption, unless surrendered for conversion
by the holders thereof on or before the close of business on the second Business
Day preceding the Redemption Date, may be deemed to be redeemed from the holders
of such Debentures for an amount equal to the applicable Redemption Price,
together with accrued but unpaid interest to, but excluding, the Redemption
Date, by one or more investment banks or other purchasers who may agree with the
Company (i) to purchase such Debentures from the holders thereof and convert
them into shares of the Company's Common Stock and (ii) to make payment for such
Debentures as aforesaid to the Trustee in trust for the holders.

         Upon due presentment for registration of transfer of this Debenture at
the office or agency of the Company maintained for that purpose in accordance
with the terms of the Indenture, a new Debenture or Debentures of authorized
denominations for an equal aggregate principal amount will be issued to the
transferee in exchange thereof, subject to the limitations provided in the
Indenture, without charge except for any tax, assessment or other governmental
charge imposed in connection therewith.

         The Company, the Trustee, any authenticating agent, any Paying Agent,
any Conversion Agent and any Debenture Registrar may deem and treat the
registered holder hereof as the absolute owner of this Debenture (whether or not
this Debenture shall be overdue and notwithstanding any notation of ownership or
other writing hereon made by anyone other than the Company or any Debenture
Registrar) for the purpose of receiving payment hereof, or on account hereof,
for the conversion hereof and for all other purposes, and neither the Company
nor the Trustee nor any other authenticating agent nor any Paying Agent nor
other Conversion Agent nor any Debenture Registrar shall be affected by any
notice to the contrary. All payments made to or upon the order of such
registered holder shall, to the extent of the sum or sums paid, satisfy and
discharge liability for monies payable on this Debenture.

         No recourse for the payment of the principal of or interest on this
Debenture, or for any claim based hereon or otherwise in respect hereof, and no
recourse under or upon any obligation, covenant or agreement of the Company in
the Indenture or any supplemental indenture or in any Debenture, or because of
the creation of any indebtedness represented thereby, shall be had against any
incorporator, stockholder, employee, agent, officer or director or subsidiary,
as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law or by
the enforcement of any assessment or penalty or otherwise, all such liability
being, by acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released.

         Terms used in this Debenture and defined in the Indenture are used
herein as therein defined.

                                      A-10

<PAGE>

                                  ABBREVIATIONS

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

<TABLE>
<S>               <C>                                                <C>
TEN COM -         as tenants in common                               UNIF GIFT MIN ACT -___ Custodian ___
TEN ENT -         as tenant by the entireties                                               (Cust)       (Minor)
JT TEN -          as joint tenants with right of survivorship        under Uniform Gifts to Minors Act
                  and not as tenants in common                       ___________________________
                                                                                  (State)
</TABLE>

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

                                      A-11

<PAGE>

                                     FORM OF
                                CONVERSION NOTICE

TO:      QUANTA SERVICES, INC.
         WELLS FARGO BANK, N.A.

         The undersigned registered owner of this Debenture hereby irrevocably
exercises the option to convert this Debenture, or the portion thereof (which is
$1,000 or a multiple thereof) below designated, into shares of Common Stock of
Quanta Services, Inc. in accordance with the terms of the Indenture referred to
in this Debenture, and directs that the shares issuable and deliverable upon
such conversion, together with any check in payment for fractional shares and
any Debentures representing any unconverted principal amount hereof, be issued
and delivered to the registered holder hereof unless a different name has been
indicated below. Capitalized terms used herein but not defined shall have the
meanings ascribed to such terms in the Indenture. If shares or any portion of
this Debenture not converted are to be issued in the name of a person other than
the undersigned, the undersigned will provide the appropriate information below
and pay all transfer taxes payable with respect thereto. Any amount required to
be paid by the undersigned on account of interest and Additional Amounts, if
any, accompanies this Debenture.

Dated: _____________________________

                                                 _______________________________

                                                 _______________________________
                                                 Signature(s)

                                      A-12

<PAGE>

                                       Signature(s) must be guaranteed by an
                                       "ELIGIBLE GUARANTOR INSTITUTION" meeting
                                       the requirements of the Debenture
                                       Registrar, which requirements include
                                       membership or participation in the
                                       Security Transfer Agent Medallion Program
                                       ("STAMP") or such other "SIGNATURE
                                       GUARANTEE PROGRAM" as may be determined
                                       by the Debenture Registrar in addition
                                       to, or in substitution for, STAMP, all in
                                       accordance with the Securities Exchange
                                       Act of 1934, as amended.

                                       _________________________________________
                                       Signature Guarantee

         Fill in the registration of shares of Common Stock if to be issued, and
Debentures if to be delivered, other than to and in the name of the registered
holder:

______________________________
(Name)

______________________________
(Street Address)

______________________________
(City, State and Zip Code)

______________________________
Please print name and address

Principal amount to be converted
(if less than all):

$_____________________________

Social Security or Other Taxpayer
Identification Number:

______________________________

                                      A-13

<PAGE>

                                     FORM OF
                     FUNDAMENTAL CHANGE REPURCHASE ELECTION

TO:      QUANTA SERVICES, INC.
         WELLS FARGO BANK, N.A.

         The undersigned registered owner of this Debenture hereby irrevocably
acknowledges receipt of a notice from Quanta Services, Inc. (the "COMPANY") as
to the occurrence of a Fundamental Change with respect to the Company and
requests and instructs the Company to repurchase the entire principal amount of
this Debenture, or the portion thereof (which is $1,000 or a multiple thereof)
below designated, in accordance with the terms of the Indenture referred to in
this Debenture at the price of 100% of such entire principal amount or portion
thereof, together with accrued interest to, but excluding, the Fundamental
Change Repurchase Date, to the registered holder hereof. Capitalized terms used
herein but not defined shall have the meanings ascribed to such terms in the
Indenture.

         If the Company elects to pay the Fundamental Change Repurchase Price,
in whole or in part, in shares of Common Stock but such portion of the
Fundamental Change Repurchase Price shall ultimately be paid to such holder
entirely in cash because any of the conditions to payment of the Fundamental
Change Repurchase Price in shares of Common Stock is not satisfied prior to the
close of business on the Business Day immediately preceding the Fundamental
Change Repurchase Date, the undersigned registered owner elects:

         [ ]      to withdraw this Fundamental Change Repurchase Election as to
                  $__________ principal amount of the Debentures to which this
                  Fundamental Change Repurchase Election relates (Certificate
                  Numbers: ______________________________________________), or

         [ ]      to receive cash in respect of $_______________ principal
                  amount of the Debentures to which this Fundamental Change
                  Repurchase Election relates.

Dated: ________________________

                                                    ____________________________

                                                    ____________________________
                                                    Signature(s)

                                      A-14

<PAGE>

NOTICE: The above signatures of the holder(s) hereof must correspond with the
name as written upon the face of the Debenture in every particular without
alteration or enlargement or any change whatever.

Debenture Certificate Number (if applicable):

Principal amount to be repurchased (if less than all):

Social Security or Other Taxpayer Identification Number:

                                      A-15

<PAGE>

                                     FORM OF
                           COMPANY REPURCHASE ELECTION

TO:      QUANTA SERVICES, INC.
         WELLS FARGO BANK, N.A.

         The undersigned registered owner of this Debenture hereby irrevocably
acknowledges receipt of a notice from Quanta Services, Inc. (the "COMPANY")
regarding the right of holders to elect to require the Company to repurchase the
Debentures and requests and instructs the Company to repay the entire principal
amount of this Debenture, or the portion thereof (which is $1,000 or an integral
multiple thereof) below designated, in accordance with the terms of the
Indenture at the price of 100% of such entire principal amount or portion
thereof, together with accrued interest to, but excluding, the Company
Repurchase Date, to the registered holder hereof. Capitalized terms used herein
but not defined shall have the meanings ascribed to such terms in the Indenture.
The Debentures shall be repurchased by the Company as of the Company Repurchase
Date pursuant to the terms and conditions specified in the Indenture. If the
Company elects to pay the Company Repurchase Price, in whole or in part, in
shares of Common Stock but such portion of the Company Repurchase Price shall
ultimately be paid to such holder entirely in cash because any of the conditions
to payment of the Company Repurchase Price in shares of Common Stock is not
satisfied prior to the close of business on the Business Day immediately
preceding the Company Repurchase Date, the undersigned registered owner elects:

         [ ]      to withdraw this Company Repurchase Election as to $__________
                  principal amount of the Debentures to which this Company
                  Repurchase Election relates (Certificate Numbers:
                  ______________________________________________), or

         [ ]      to receive cash in respect of $_______________ principal
                  amount of the Debentures to which this Company Repurchase
                  Election relates.

Dated: ________________________

                                                    ____________________________

                                                    ____________________________
                                                    Signature(s)

                                      A-16

<PAGE>

NOTICE: The above signatures of the holder(s) hereof must correspond with the
name as written upon the face of the Debenture in every particular without
alteration or enlargement or any change whatever.

Debenture Certificate Number (if applicable):

_________________________________________________

Principal amount to be repurchased (if less than all):

_________________________________________________

Social Security or Other Taxpayer Identification Number:

_________________________________________________

                                      A-17

<PAGE>

                                   ASSIGNMENT

         For value received _____________________ hereby sell(s) assign(s) and
transfer(s) unto __________________________________________ (Please insert
social security or other Taxpayer Identification Number of assignee) the within
Debenture, and hereby irrevocably constitutes and appoints attorney to transfer
said Debenture on the books of the Company, with full power of substitution in
the premises.

         In connection with any transfer of the Debenture prior to the
expiration of the holding period applicable to sales thereof under Rule 144(k)
under the Securities Act (or any successor provision) (other than any transfer
pursuant to a registration statement that has been declared effective under the
Securities Act), the undersigned confirms that such Debenture is being
transferred:

         [ ]      To Quanta Services, Inc. or a subsidiary thereof; or

         [ ]      To a "QUALIFIED INSTITUTIONAL BUYER" in compliance with Rule
                  144A under the Securities Act of 1933, as amended; or

         [ ]      Pursuant to and in compliance with Rule 144 under the
                  Securities Act of 1933, as amended; or

         [ ]      Pursuant to a Registration Statement which has been declared
                  effective under the Securities Act of 1933, as amended, and
                  which continues to be effective at the time of transfer;

and unless the Debenture has been transferred to Quanta Services, Inc. or a
subsidiary thereof, the undersigned confirms that such Debenture is not being
transferred to an "affiliate" of the Company as defined in Rule 144 under the
Securities Act of 1933, as amended.

         Unless one of the boxes is checked, the Trustee will refuse to register
any of the Debentures evidenced by this certificate in the name of any person
other than the registered holder thereof.

Dated: _______________________

                                                      __________________________

                                                      __________________________
                                                      Signature(s)

                                      A-18

<PAGE>

                                       Signature(s) must be guaranteed by an
                                       "ELIGIBLE GUARANTOR INSTITUTION" meeting
                                       the requirements of the Debenture
                                       Registrar, which requirements include
                                       membership or participation in the
                                       Security Transfer Agent Medallion Program
                                       ("STAMP") or such other "SIGNATURE
                                       GUARANTEE PROGRAM" as may be determined
                                       by the Debenture Registrar in addition
                                       to, or in substitution for, STAMP, all in
                                       accordance with the Securities Exchange
                                       Act of 1934, as amended.

                                       _________________________________________
                                       Signature Guarantee

NOTICE: The signature on the Conversion Notice, the Fundamental Change
Repurchase Election, the Company Repurchase Election or the Assignment must
correspond with the name as written upon the face of the Debenture in every
particular without alteration or enlargement or any change whatsoever.

                                      A-19

<PAGE>

                                                                      Schedule I

                [Include Schedule I only for a Global Debenture]

                              QUANTA SERVICES, INC.
                4.50% Convertible Subordinated Debenture due 2023

No. 1

<TABLE>
<CAPTION>
                                                                             Authorized
                               Notation Explaining Principal Amount     Signature of Trustee
  Date     Principal Amount                Recorded                         or Custodian
---------  ----------------    ------------------------------------     --------------------
<S>        <C>                 <C>                                      <C>
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
_________  ________________    ____________________________________     ____________________
</TABLE>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>4
<FILENAME>h10560exv10w1.txt
<DESCRIPTION>4.50% CONVERTIBLE DEBENTURES RESALE RIGHTS AGMT
<TEXT>
<PAGE>

                                                                    EXHIBIT 10.1

BANC OF AMERICA SECURITIES LLC
J.P. MORGAN SECURITIES INC.

                     $225,000,000 AGGREGATE PRINCIPAL AMOUNT

                              QUANTA SERVICES, INC.

                    4.50% CONVERTIBLE SUBORDINATED DEBENTURES

                                    DUE 2023

                      RESALE REGISTRATION RIGHTS AGREEMENT

                             DATED OCTOBER 17, 2003

<PAGE>

                                                                               1

         RESALE REGISTRATION RIGHTS AGREEMENT, dated as of October 17, 2003,
among Quanta Services, Inc., a Delaware corporation (together with any successor
entity, herein referred to as the "COMPANY"), Banc of America Securities LLC and
J.P. Morgan Securities Inc., as representatives of the several initial
purchasers (the "INITIAL PURCHASERS") under the Purchase Agreement (as defined
below).

         Pursuant to the Purchase Agreement, dated as of October 9, 2003, among
the Company, Banc of America Securities LLC and J.P. Morgan Securities Inc., as
representatives of the Initial Purchasers (the "PURCHASE AGREEMENT"), the
Initial Purchasers have agreed to purchase from the Company $225,000,000
($270,000,000 if the Initial Purchasers exercise their option in full) in
aggregate principal amount of 4.50% Convertible Subordinated Debentures due 2023
(the "DEBENTURES"). The Debentures will be convertible into fully paid,
nonassessable shares of common stock, par value $0.00001 per share, of the
Company together with the rights (the "Rights") evidenced by such Common Stock
to the extent provided in the Rights Agreement dated as of dated March 8, 2000
(and as amended prior to the date hereof) between the Company and American Stock
Transfer & Trust Company (collectively, the "COMMON Stock"). The Debentures will
be convertible on the terms, and subject to the conditions, set forth in the
Indenture (as defined herein). To induce the Initial Purchasers to purchase the
Debentures, the Company has agreed to provide the registration rights set forth
in this Agreement pursuant to Section 5(h) of the Purchase Agreement.

         The parties hereby agree as follows:

         1.       Definitions. Capitalized terms used in this Agreement without
definition shall have their respective meanings set forth in the Purchase
Agreement. As used in this Agreement, the following capitalized terms shall have
the following meanings:

         "AFFILIATE" of any specified person means any other person which,
directly or indirectly, is in control of, is controlled by, or is under common
control with, such specified person. For purposes of this definition, control of
a person means the power, direct or indirect, to direct or cause the direction
of the management and policies of such person whether by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.

         "AGREEMENT": This Resale Registration Rights Agreement.

         "BLUE SKY APPLICATION": As defined in Section 6(a)(i) hereof.

         "AMENDED EFFECTIVENESS DEADLINE DATE" has the meaning set forth in
Section 2(e) hereof.

         "BUSINESS DAY": The definition of "Business Day" in the Indenture.

<PAGE>

                                                                               2

         "COMMISSION": Securities and Exchange Commission.

         "COMMON STOCK": As defined in the preamble hereto.

         "COMPANY": As defined in the preamble hereto.

         "DEBENTURES": As defined in the preamble hereto.

         "EFFECTIVENESS PERIOD": As defined in Section 2(a)(iii) hereof.

         "EFFECTIVENESS TARGET DATE": As defined in Section 2(a)(ii) hereof.

         "EXCHANGE ACT": Securities Exchange Act of 1934, as amended.

         "HOLDER": A Person who owns, beneficially or otherwise, Transfer
Restricted Securities.

         "INDEMNIFIED HOLDER": As defined in Section 6(a) hereof.

         "INDENTURE": The Indenture, dated as of October 17, 2003 between the
Company and Wells Fargo Bank, N.A., as trustee (the "Trustee"), pursuant to
which the Securities are to be issued, as such Indenture is amended, modified or
supplemented from time to time in accordance with the terms thereof.

         "INITIAL PURCHASERS": As defined in the preamble hereto.

         "LIQUIDATED DAMAGES": As defined in Section 3(a) hereof.

         "LIQUIDATED DAMAGES PAYMENT DATE": Each April 15 and October 15.

         "MAJORITY OF HOLDERS": Holders holding over 50% of the aggregate
principal amount of Debentures outstanding; provided that, for the purpose of
this definition, a holder of shares of Common Stock which constitute Transfer
Restricted Securities and issued upon conversion, redemption or repurchase of
the Debentures shall be deemed to hold an aggregate principal amount of
Debentures (in addition to the principal amount of Debentures held by such
holder) equal to the quotient of (x) the number of such shares of Common Stock
held by such holder and (y) the conversion rate in effect at the time of such
conversion, redemption or repurchase as determined in accordance with the
Indenture.

         "NASD": National Association of Securities Dealers, Inc.

         "NOTICE AND QUESTIONNAIRE": a written notice executed by the respective
Holder and delivered to the Company containing substantially the information
called for by the Selling Securityholder Notice and Questionnaire attached as
Annex A to the Offering Memorandum of the Company issued October 9, 2003
relating to the Debentures.

<PAGE>
                                                                               3

         "NOTICE HOLDER": on any date, any Holder that has delivered a Notice
and Questionnaire to the Company on or prior to such date.

         "PERSON": An individual, partnership, corporation, company,
unincorporated organization, trust, joint venture or a government or agency or
political subdivision thereof.

         "PURCHASE AGREEMENT": As defined in the preamble hereto.

         "PROSPECTUS": The prospectus included in a Shelf Registration
Statement, as amended or supplemented by any prospectus supplement and by all
other amendments thereto, including post-effective amendments, and all material
incorporated by reference into such prospectus.

         "RECORD HOLDER": With respect to any Liquidated Damages Payment Date,
each Person who is a Holder on the 15th day preceding the relevant Liquidated
Damages Payment Date. In the case of a Holder of shares of Common Stock issued
upon conversion of the Debentures, "Record Holder" shall mean each Person who is
a Holder of shares of Common Stock which constitute Transfer Restricted
Securities on the 15th day preceding the relevant Liquidated Damages Payment
Date.

         "REGISTRATION DEFAULT": As defined in Section 3(a) hereof.

         "SECURITIES ACT": Securities Act of 1933, as amended.

         "SHELF FILING DEADLINE": As defined in Section 2(a)(i) hereof.

         "SHELF REGISTRATION STATEMENT": As defined in Section 2(a)(i) hereof.

         "SUBSEQUENT SHELF REGISTRATION STATEMENT" has the meaning set forth in
Section 2(c) hereof.

         "SUSPENSION NOTICE": As defined in Section 4(c) hereof.

         "SUSPENSION PERIOD": As defined in Section 4(b)(i) hereof.

         "TIA": Trust Indenture Act of 1939, as amended, and the rules and
regulations of the Commission thereunder, in each case, as in effect on the date
the Indenture is qualified under the TIA.

         "TRANSFER RESTRICTED SECURITIES": Each Debenture and each share of
Common Stock issued upon conversion, redemption or repurchase of Debentures
until the earlier of:

                           (i)      the date on which such Debenture or such
                  share of Common Stock issued upon conversion, redemption or
                  repurchase

<PAGE>

                                                                               4

                  has been effectively registered under the Securities Act and
                  disposed of in accordance with the Shelf Registration
                  Statement;

                           (ii)     the date on which such Debenture or such
                  share of Common Stock issued upon conversion, redemption or
                  repurchase is transferred in compliance with Rule 144 under
                  the Securities Act or may be sold or transferred by a person
                  who is not an affiliate of the Company pursuant to Rule 144
                  under the Securities Act (or any other similar provision then
                  in force) without any volume or manner of sale restrictions
                  thereunder; or

                           (iii)    the date on which such Debenture or such
                  share of Common Stock issued upon conversion, redemption or
                  repurchase ceases to be outstanding (whether as a result of
                  redemption, repurchase and cancellation, conversion or
                  otherwise).

         "UNDERWRITTEN REGISTRATION": A registration in which Debentures of the
Company are sold to an underwriter for reoffering to the public.

         Unless the context otherwise requires, the singular includes the
plural, and words in the plural include the singular.

         2.       Shelf Registration.

                  (a)      The Company shall:

                           (i)      not later than 90 days after the date hereof
                  (the "SHELF FILING DEADLINE"), cause to be filed a
                  registration statement pursuant to Rule 415 under the
                  Securities Act (the "SHELF REGISTRATION STATEMENT"), which
                  Shelf Registration Statement shall provide for resales of all
                  Transfer Restricted Securities held by Holders that have
                  provided the information required pursuant to the terms of
                  Section 2(b) hereof;

                           (ii)     use commercially reasonable efforts to cause
                  the Shelf Registration Statement to be declared effective by
                  the Commission not later than 210 days after the date hereof
                  (the "EFFECTIVENESS TARGET DATE"); and

                           (iii)    use commercially reasonable efforts to keep
                  the Shelf Registration Statement continuously effective,
                  supplemented and amended as required by the provisions of
                  Section 4(b) hereof to the extent necessary to ensure that (A)
                  it is available for resales by the Holders of Transfer
                  Restricted Securities entitled, subject to Section 2(b), to
                  the benefit of this Agreement and (B) conforms with the
                  requirements of this Agreement and the Securities Act and the
                  rules and regulations of the Commission promulgated

<PAGE>

                                                                               5

                  thereunder as announced from time to time, for a period (the
                  "EFFECTIVENESS PERIOD") until the earliest of:

                                    (1)      two years following the last date
                           of original issuance of any of the Debentures;

                                    (2)      the date when the Holders of
                           Transfer Restricted Securities are able to sell all
                           such Transfer Restricted Securities immediately
                           without restriction pursuant to the volume limitation
                           provisions of Rule 144 under the Securities Act; or

                                    (3)      the date when all of the Transfer
                           Restricted Securities of those Holders that complete
                           and deliver in a timely manner the Holder
                           Questionnaire described below are registered under
                           the Shelf Registration Statement and disposed of in
                           accordance with the Shelf Registration Statement.

                   (b)     At the time the Shelf Registration Statement is
         declared effective, each Holder that became a Notice Holder on or prior
         to the date fifteen (15) Business Days prior to such time of
         effectiveness shall be named as a selling securityholder in the Shelf
         Registration Statement and the related Prospectus in such a manner as
         to permit such Holder to deliver such Prospectus to purchasers of
         Transfer Restricted Securities in accordance with applicable law. None
         of the Company's securityholders (other than the Holders of Transfer
         Restricted Securities) shall have the right to include any of the
         Company's securities in the Shelf Registration Statement.

                   (c)      If the Shelf Registration Statement or any
         Subsequent Shelf Registration Statement ceases to be effective for any
         reason at any time during the Effectiveness Period (other than because
         all Transfer Restricted Securities registered thereunder shall have
         been resold pursuant thereto or shall have otherwise ceased to be
         Transfer Restricted Securities), the Company shall use its reasonable
         best efforts to obtain the prompt withdrawal of any order suspending
         the effectiveness thereof, and in any event shall within thirty (30)
         days of such cessation of effectiveness amend the Shelf Registration
         Statement in a manner reasonably expected to obtain the withdrawal of
         the order suspending the effectiveness thereof, or file an additional
         Shelf Registration Statement covering all of the securities that as of
         the date of such filing are Transfer Restricted Securities ( a
         "SUBSEQUENT SHELF REGISTRATION STATEMENT"). If a Subsequent Shelf
         Registration Statement is filed, the Company shall use its reasonable
         best efforts to cause the Subsequent Shelf Registration Statement to
         become effective as promptly as is practicable after such filing and to
         keep such Registration Statement (or subsequent Shelf

<PAGE>

                                                                               6

         Registration Statement) continuously effective until the end of the
         Effectiveness Period.

                   (d)      The Company shall supplement and amend the Shelf
         Registration Statement if required by the rules, regulations or
         instructions applicable to the registration form used by the Company
         for such Shelf Registration Statement, if required by the Securities
         Act or as reasonably requested by the Initial Purchasers or by the
         Trustee on behalf of the Holders of the Transfer Restricted Securities
         covered by such Shelf Registration Statement.

                   (e)      Each Holder agrees that if such Holder wishes to
         sell Transfer Restricted Securities pursuant to a Shelf Registration
         Statement and related Prospectus, it will do so only in accordance with
         this Section 2(e) and Section 4(b). Each Holder wishing to sell
         Transfer Restricted Securities pursuant to a Shelf Registration
         Statement and related Prospectus agrees to deliver a Notice and
         Questionnaire to the Company at least three (3) Business Days prior to
         any intended distribution of Transfer Restricted Securities under the
         Shelf Registration Statement. From and after the date the Shelf
         Registration Statement is declared effective the Company shall, as
         promptly as practicable after the date a Notice and Questionnaire is
         delivered, and in any event upon the later of (x) ten (10) Business
         Days after such date (but no earlier than ten (10) Business Days after
         effectiveness) or (y) ten (10) Business Days after the expiration of
         any Suspension Period in effect when the Notice and Questionnaire is
         delivered or put into effect within ten (10) Business Days of such
         delivery date:

                            (i)      if required by applicable law, file with
                  the SEC a post-effective amendment to the Shelf Registration
                  Statement or prepare and, if required by applicable law, file
                  a supplement to the related Prospectus or a supplement or
                  amendment to any document incorporated therein by reference or
                  file any other required document so that the Holder delivering
                  such Notice and Questionnaire is named as a selling
                  securityholder in the Shelf Registration Statement and the
                  related Prospectus in such a manner as to permit such Holder
                  to deliver such Prospectus to purchasers of the Transfer
                  Restricted Securities in accordance with applicable law and,
                  if the Company shall file a post-effective amendment to the
                  Shelf Registration Statement, use commercially reasonable
                  efforts to cause such post-effective amendment to be declared
                  effective under the Securities Act as promptly as is
                  practicable, but in any event by the date (the "AMENDMENT
                  EFFECTIVENESS DEADLINE DATE") that is sixty (60) days after
                  the date such post effective amendment is required by this
                  clause to be filed:

<PAGE>

                                                                         7

                            (ii)     provide such Holder copies of the any
                  documents filed pursuant to Section 2(e)(i); and

                            (iii)    notify such Holder as promptly as
                  practicable after the effectiveness under the Securities Act
                  of any post-effective amendment filed pursuant to Section
                  2(e)(i);

provided that if such Notice and Questionnaire is delivered during a Suspension
Period, the Company shall so inform the Holder delivering such Notice and
Questionnaire and shall take the actions set forth in clauses (i), (ii) and
(iii) above upon expiration of the Suspension Period in accordance with Section
4(b). Notwithstanding anything contained herein to the contrary, (i) the Company
shall be under no obligation to name any Holder that is not a Notice Holder as a
selling securityholder in any Registration Statement or related Prospectus and
(ii) the Amendment Effectiveness Deadline Date shall be extended by up to ten
(10) Business Days from the expiration of a Suspension Period (and the Company
shall incur no obligation to pay Liquidated Damages during such extension) if
such Suspension Period shall be in effect on the Amendment Effectiveness
Deadline Date.

         3.       Liquidated Damages.

                  (a)      If:

                           (i)      the Shelf Registration Statement is not
                  filed with the Commission prior to or on the Shelf Filing
                  Deadline;

                           (ii)     the Shelf Registration Statement has not
                  been declared effective by the Commission prior to or on the
                  Effectiveness Target Date;

                           (iii)    the Company has failed to perform its
                  obligations set forth in Section 2(e) within the time period
                  required therein;

                           (iv)     any post-effective amendment to a Shelf
                  Registration filed pursuant to Section 2(e)(i) has not become
                  effective under the Securities Act on or prior to the
                  Amendment Effectiveness Deadline Date;

                           (v)      except as provided in Section 4(b)(i)
                  hereof, the Shelf Registration Statement is filed and declared
                  effective but, during the Effectiveness Period, shall
                  thereafter cease to be effective or fail to be usable for its
                  intended purpose without being succeeded within ten Business
                  Days by a post-effective amendment to the Shelf Registration
                  Statement, a supplement to the Prospectus or a report filed
                  with the Commission pursuant to Section 13(a), 13(c), 14 or
                  15(d) of the Exchange Act that cures such failure and, in the

<PAGE>

                                                                               8

                  case of a post-effective amendment, is itself immediately
                  declared effective; or

                           (vi)     (A) prior to or on the 45th or 60th day, as
                  the case may be, of any Suspension Period, such suspension has
                  not been terminated or (B) Suspension Periods exceed an
                  aggregate of 120 days in any 360 day period,

(each such event referred to in foregoing clauses (i) through (iv), a
"REGISTRATION DEFAULT"), the Company hereby agrees to pay interest ("LIQUIDATED
DAMAGES") or issue additional shares of Common Stock, as applicable, with
respect to the Transfer Restricted Securities from and including the day
following the Registration Default to but excluding the earlier of (1) the day
on which the Registration Default has been cured and (2) the date the Shelf
Registration Statement is no longer required to be kept effective as set out
below:

                                    (A)      in respect of the Debentures, the
                           Company agrees to pay interest to each holder of
                           Debentures accruing at a rate of (x) with respect to
                           the first 90-day period during which a Registration
                           Default shall have occurred and be continuing, equal
                           to 0.25% per annum of the aggregate issue price of
                           the Debentures, and (y) with respect to the period
                           commencing on the 91st day following the day the
                           Registration Default shall have occurred and be
                           continuing, equal to 0.50% per annum of the aggregate
                           issue price of the Debentures; provided that in no
                           event shall Liquidated Damages accrue at a rate per
                           year exceeding 0.50% of the aggregate issue price of
                           the Debentures;

                                    (B)      in respect of Debentures submitted
                           for conversion into Common Stock during a
                           Registration Default, the Company agrees to pay
                           accrued and unpaid Liquidated Damages calculated in
                           accordance with paragraph (A) up to and including the
                           Settlement Date (as defined in the Indenture) and to
                           issue additional shares to each Holder that has
                           submitted for conversion some or all of its
                           Debentures into Common Stock equal to 3% of the
                           Applicable Conversion Rate (as defined in the
                           Indenture) for each $1,000 principal amount of
                           Debentures (except to the extent the Company elects
                           to deliver cash upon conversion in accordance with
                           the terms of the Indenture); and

                                    (C)      in respect of Common Stock, each
                           Holder of such Common Stock will not be entitled to
                           any Liquidated Damages.

<PAGE>

                                                                               9

                  (b)      All accrued Liquidated Damages shall be paid in
         arrears to Record Holders by the Company on each Liquidated Damages
         Payment Date. Upon the cure of all Registration Defaults relating to
         any particular Debenture or share of Common Stock, the accrual of
         Liquidated Damages with respect to such Debenture or share of Common
         Stock will cease.

         All obligations of the Company set forth in this Section 3 that are
outstanding with respect to any Transfer Restricted Security at the time such
security ceases to be a Transfer Restricted Security shall survive until such
time as all such obligations with respect to such Transfer Restricted Security
shall have been satisfied in full.

         The Liquidated Damages set forth above shall be the exclusive monetary
remedy available to the Holders of Transfer Restricted Securities for each
Registration Default.

         4.       Registration Procedures.

                  (a)      In connection with the Shelf Registration Statement,
         the Company shall comply with all the provisions of Section 4(b) hereof
         and shall use commercially reasonable efforts to effect such
         registration to permit the sale of the Transfer Restricted Securities,
         and pursuant thereto, shall as expeditiously as possible prepare and
         file with the Commission a Shelf Registration Statement relating to the
         registration on any appropriate form under the Securities Act.

                  (b)      In connection with the Shelf Registration Statement
         and any Prospectus required by this Agreement to permit the sale or
         resale of Transfer Restricted Securities, the Company shall:

                           (i)      Subject to any notice by the Company in
                  accordance with this Section 4(b) of the existence of any fact
                  or event of the kind described in Section 4(b)(iii)(D), use
                  commercially reasonable efforts to keep the Shelf Registration
                  Statement continuously effective during the Effectiveness
                  Period; upon the occurrence of any event that would cause the
                  Shelf Registration Statement or the Prospectus contained
                  therein (A) to contain a material misstatement or omission or
                  (B) not to be effective and usable for resale of Transfer
                  Restricted Securities during the Effectiveness Period, the
                  Company shall file promptly an appropriate amendment to the
                  Shelf Registration Statement, a supplement to the Prospectus
                  or a report filed with the Commission pursuant to Section
                  13(a), 13(c), 14 or 15(d) of the Exchange Act, in the case of
                  clause (A), correcting any such misstatement or omission, and,
                  in the case of either clause (A) or (B), use commercially
                  reasonable efforts to cause such amendment to be declared
                  effective and the Shelf Registration Statement and the

<PAGE>

                                                                              10

                  related Prospectus to become usable for their intended
                  purposes as soon as practicable thereafter. Notwithstanding
                  the foregoing, the Company may suspend the effectiveness of
                  the Shelf Registration Statement by written notice to the
                  Holders for a period not to exceed an aggregate of 45 days in
                  any 90-day period (each such period, a "SUSPENSION PERIOD")
                  upon:

                                    (x)      the occurrence or existence of any
                  fact or the happening of any event as a result of which the
                  Shelf Registration Statement, the Prospectus, any amendment or
                  supplement thereto, or any document incorporated by reference
                  therein would, in the Company's judgment, contain an untrue
                  statement of a material fact or omit to state a material fact
                  required to be stated therein or necessary to make the
                  statements therein not misleading; and

                                    (y)      the occurrence or existence of any
                  corporate development that, in the Company's judgment, makes
                  it appropriate to suspend the effectiveness of the Shelf
                  Registration Statement;

         provided that the Company will use its reasonable best efforts to
         ensure that the use of the Prospectus may be resumed (A) in the case of
         clause (x) above, as soon as, in the sole judgment of the Company,
         public disclosure of such fact or event would not be prejudicial to or
         contrary to the interests of the Company or, if necessary to avoid
         unreasonable burden or expense, as soon as practicable thereafter and
         (B) in the case of clause (y) above, as soon as, in the discretion of
         the Company, such suspension is no longer appropriate; provided,
         however, that Suspension Periods shall not exceed an aggregate of 120
         days in any 360-day period. The Company shall not be required to
         specify in the written notice to the Holders the nature of the event
         giving rise to the Suspension Period.

                           (ii)     Prepare and file with the Commission such
                  amendments and post-effective amendments to the Shelf
                  Registration Statement as may be necessary to keep the Shelf
                  Registration Statement effective during the Effectiveness
                  Period; cause the Prospectus to be supplemented by any
                  required Prospectus supplement, and as so supplemented to be
                  filed pursuant to Rule 424 under the Securities Act, and to
                  comply fully with the applicable provisions of Rules 424 and
                  430A under the Securities Act in a timely manner; and comply
                  with the provisions of the Securities Act with respect to the
                  disposition of all Debentures covered by the Shelf
                  Registration Statement during the applicable period in
                  accordance with the intended method or methods of distribution
                  by the sellers thereof set forth in the Shelf Registration
                  Statement or supplement to the Prospectus.

<PAGE>
                                                                              11

                           (iii)    Advise the selling Holders promptly and, if
                  requested by such selling Holders, to confirm such advice in
                  writing, except as provided in clause (D) below:

                                    (A)      when the Prospectus or any
                           Prospectus supplement or post-effective amendment has
                           been filed, and, with respect to the Shelf
                           Registration Statement or any post-effective
                           amendment thereto, when the same has become
                           effective,

                                    (B)      of any request by the Commission
                           for amendments to the Shelf Registration Statement or
                           amendments or supplements to the Prospectus or for
                           additional information relating thereto,

                                    (C)      of the issuance by the Commission
                           of any stop order suspending the effectiveness of the
                           Shelf Registration Statement under the Securities Act
                           or of the suspension by any state securities
                           commission of the qualification of the Transfer
                           Restricted Securities for offering or sale in any
                           jurisdiction, or the initiation of any proceeding for
                           any of the preceding purposes, or

                                    (D)      of the existence of any fact or the
                           happening of any event, during the Effectiveness
                           Period, that makes any statement of a material fact
                           made in the Shelf Registration Statement, the
                           Prospectus, any amendment or supplement thereto, or
                           any document incorporated by reference therein
                           untrue, or that requires the making of any additions
                           to or changes in the Shelf Registration Statement or
                           the Prospectus in order to make the statements
                           therein not misleading.

         If at any time the Commission shall issue any stop order suspending the
         effectiveness of the Shelf Registration Statement, or any state
         securities commission or other regulatory authority shall issue an
         order suspending the qualification or exemption from qualification of
         the Transfer Restricted Securities under state securities or Blue Sky
         laws, the Company shall use its reasonable best efforts to obtain the
         withdrawal or lifting of such order at the earliest possible time and
         will provide to each Holder who is named in the Shelf Registration
         Statement prompt notice of the withdrawal of any such order.

                           (iv)     Make available at reasonable times for
                  inspection by one or more representatives of the selling
                  Holders, designated in writing by a Majority of Holders whose
                  Transfer Restricted Securities are included in the Shelf
                  Registration Statement, and any

<PAGE>

                                                                              12

                  attorney or accountant retained by such selling Holders, all
                  financial and other records, pertinent corporate documents and
                  properties of the Company as shall be reasonably necessary to
                  enable them to conduct a reasonable investigation within the
                  meaning of Section 11 of the Securities Act, and cause the
                  Company's officers, directors, managers and employees to
                  supply all information reasonably requested by any such
                  representative or representatives of the selling Holders,
                  attorney or accountant in connection therewith; provided,
                  however, that the Company shall have no obligation to deliver
                  information to any selling Holder or representative pursuant
                  to this Section 4(b)(iv) unless such selling Holder or
                  representative shall have executed and delivered a
                  confidentiality agreement in a form acceptable to the Company
                  relating to such information.

                           (v)      If requested by any selling Holders,
                  promptly incorporate in the Shelf Registration Statement or
                  Prospectus, pursuant to a supplement or post-effective
                  amendment if necessary, such information as such selling
                  Holders may reasonably request to have included therein,
                  including, without limitation, information relating to the
                  "PLAN OF DISTRIBUTION" of the Transfer Restricted Securities.

                           (vi)     Furnish to each selling Holder upon their
                  request, without charge, at least one copy of the Shelf
                  Registration Statement, as first filed with the Commission,
                  and of each amendment thereto (and any documents incorporated
                  by reference therein or exhibits thereto (or exhibits
                  incorporated in such exhibits by reference) as such Person may
                  request).

                           (vii)    Deliver to each selling Holder, without
                  charge, as many copies of the Prospectus (including each
                  preliminary Prospectus) and any amendment or supplement
                  thereto as such Persons reasonably may request; subject to any
                  notice by the Company in accordance with this Section 4(b) of
                  the existence of any fact or event of the kind described in
                  Section 4(b)(iii)(D), the Company hereby consents to the use
                  of the Prospectus and any amendment or supplement thereto by
                  each of the selling Holders in connection with the offering
                  and the sale of the Transfer Restricted Securities covered by
                  the Prospectus or any amendment or supplement thereto.

                           (viii)   Before any public offering of Transfer
                  Restricted Securities, cooperate with the selling Holders and
                  their counsel in connection with the registration and
                  qualification of the Transfer Restricted Securities under the
                  securities or Blue Sky laws of such

<PAGE>

                                                                              13

                  jurisdictions in the United States as the selling Holders may
                  reasonably request and do any and all other acts or things
                  necessary or advisable to enable the disposition in such
                  jurisdictions of the Transfer Restricted Securities covered by
                  the Shelf Registration Statement; provided, however, that the
                  Company shall not be required (A) to register or qualify as a
                  foreign corporation or a dealer of securities where it is not
                  now so qualified or to take any action that would subject it
                  to the service of process in any jurisdiction where it is not
                  now so subject or (B) to subject itself to general or
                  unlimited service of process or to taxation in any such
                  jurisdiction if they are not now so subject.

                           (ix)     Cooperate with the selling Holders to
                  facilitate the timely preparation and delivery of certificates
                  representing Transfer Restricted Securities to be sold and not
                  bearing any restrictive legends (unless required by applicable
                  securities laws); and enable such Transfer Restricted
                  Securities to be in such denominations and registered in such
                  names as the Holders may request at least two Business Days
                  before any sale of Transfer Restricted Securities.

                           (x)      Use its reasonable best efforts to cause the
                  Transfer Restricted Securities covered by the Shelf
                  Registration Statement to be registered with or approved by
                  such other U.S. governmental agencies or authorities as may be
                  necessary to enable the seller or sellers thereof to
                  consummate the disposition of such Transfer Restricted
                  Securities.

                           (xi)     Subject to Section 4(b)(i) hereof, if any
                  fact or event contemplated by Section 4(b)(iii)(D) hereof
                  shall exist or have occurred, use its reasonable best efforts
                  to prepare a supplement or post-effective amendment to the
                  Shelf Registration Statement or related Prospectus or any
                  document incorporated therein by reference or file any other
                  required document so that, as thereafter delivered to the
                  purchasers of Transfer Restricted Securities, the Prospectus
                  will not contain an untrue statement of a material fact or
                  omit to state any material fact required to be stated therein
                  or necessary to make the statements therein, in light of the
                  circumstances in which they are made, not misleading.

                           (xii)    Provide CUSIP numbers for all Transfer
                  Restricted Securities not later than the effective date of the
                  Shelf Registration Statement and provide the Trustee under the
                  Indenture with certificates for the Debentures that are in a
                  form eligible for deposit with The Depository Trust Company.

<PAGE>

                                                                              14

                           (xiii)   Cooperate and assist in any filings required
                  to be made with the NASD and in the performance of any due
                  diligence investigation by any underwriter that is required to
                  be retained in accordance with the rules and regulations of
                  the NASD.

                           (xiv)    Otherwise use its best efforts to comply
                  with all applicable rules and regulations of the Commission
                  and all reporting requirements under the rules and regulations
                  of the Exchange Act.

                           (xv)     Cause the Indenture to be qualified under
                  the TIA not later than the effective date of the Shelf
                  Registration Statement required by this Agreement, and, in
                  connection therewith, cooperate with the Trustee and the
                  holders of Debentures to effect such changes to the Indenture
                  as may be required for such Indenture to be so qualified in
                  accordance with the terms of the TIA; and execute and use its
                  reasonable best efforts to cause the Trustee thereunder to
                  execute all documents that may be required to effect such
                  changes and all other forms and documents required to be filed
                  with the Commission to enable such Indenture to be so
                  qualified in a timely manner.

                           (xvi)    Cause all Common Stock covered by the Shelf
                  Registration Statement to be listed or quoted, as the case may
                  be, on each securities exchange or automated quotation system
                  on which Common Stock is then listed or quoted.

                           (xvii)   Provide to each Holder upon written request
                  each document filed with the Commission pursuant to the
                  requirements of Section 13 and Section 15 of the Exchange Act
                  after the effective date of the Shelf Registration Statement,
                  unless such document is available through the Commission's
                  EDGAR system.

                  (c)      Each Holder agrees by acquisition of a Transfer
         Restricted Security that, upon receipt of any notice (a "SUSPENSION
         NOTICE") from the Company of the existence of any fact of the kind
         described in Section 4(b)(iii)(D) hereof, such Holder will forthwith
         discontinue disposition of Transfer Restricted Securities pursuant to
         the Shelf Registration Statement until:

                           (i)      such Holder has received copies of the
                  supplemented or amended Prospectus contemplated by Section
                  4(b)(xi) hereof; or

                           (ii)     such Holder is advised in writing by the
                  Company that the use of the Prospectus may be resumed, and has
                  received copies of any additional or supplemental filings that
                  are incorporated by reference in the Prospectus.

<PAGE>

                                                                              15

If so directed by the Company, each Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in such
Holder's possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of such notice of suspension.

                  (d)      Each Holder agrees by acquisition of a Transfer
         Restricted Security, that no Holder shall be entitled to sell any of
         such Transfer Restricted Securities pursuant to a Registration
         Statement; or to receive a Prospectus relating thereto, unless such
         Holder has furnished the Company with a Notice and Questionnaire as
         required pursuant to Section 2(e) hereof (including the information
         required to be included in such Notice and Questionnaire) and the
         information set forth in the next sentence. Each Notice Holder agrees
         promptly to furnish to the Company all information required to be
         disclosed in order to make the information previously furnished to the
         Company by such Notice Holder not misleading and any other information
         regarding such Notice Holder and the distribution of such Transfer
         Restricted Securities as the Company may from time to time reasonably
         request in writing. Any sale of any Transfer Restricted Securities by
         any Holder shall constitute a representation and warranty by such
         Holder that the information relating to such Holder and its plan of
         distribution is as set forth in the Prospectus delivered by such Holder
         in connection with such disposition, that such Prospectus does not as
         of the time of such sale contain any untrue statement of a material
         fact relating to or provided by such Holder to its plan of distribution
         and that such Prospectus does not as of the time of such sale omit to
         state any material fact relating to or provided by such Holder or its
         plan of distribution necessary to make the statements in such
         Prospectus, in the light of the circumstances under which they were
         made not misleading.

         5.       Registration Expenses.

         All expenses incident to the Company's performance of or compliance
with this Agreement shall be borne by the Company regardless of whether a Shelf
Registration Statement becomes effective, including, without limitation:

                           (i)      all registration and filing fees and
                  expenses (including filings made with the NASD);

                           (ii)     all fees and expenses of compliance with
                  federal securities and state Blue Sky or securities laws;

                           (iii)    all expenses of printing (including printing
                  of Prospectuses and certificates for the Common Stock to be
                  issued upon conversion of the Debentures) and the Company's
                  expenses for messenger and delivery services and telephone;

<PAGE>

                                                                              16

                           (iv)     all fees and disbursements of counsel to the
                  Company;

                           (v)      all application and filing fees in
                  connection with listing (or authorizing for quotation) the
                  Common Stock on a national securities exchange or automated
                  quotation system pursuant to the requirements hereof; and

                           (vi)     all fees and disbursements of independent
                  certified public accountants of the Company.

         The Company shall bear its internal expenses (including, without
limitation, all salaries and expenses of their officers and employees performing
legal, accounting or other duties), the expenses of any annual audit and the
fees and expenses of any Person, including special experts, retained by the
Company.

         6.       Indemnification And Contribution.

                  (a)      The Company agrees to indemnify and hold harmless
         each Holder of Transfer Restricted Securities covered by the Shelf
         Registration Statement (including each Initial Purchaser), and its
         directors, officers, and employees and each person, if any, who
         controls any such Holder within the meaning of the Securities Act or
         the Exchange Act (each, an "INDEMNIFIED Holder"), against any loss,
         claim, damage, liability or expense, joint or several, or any action in
         respect thereof (including, but not limited to, any loss, claim,
         damage, liability or action relating to resales of the Transfer
         Restricted Securities), to which such Indemnified Holder may become
         subject, insofar as any such loss, claim, damage, liability or action
         arises out of, or is based upon:

                           (i)      any untrue statement or alleged untrue
                  statement of a material fact contained in (A) the Shelf
                  Registration Statement as originally filed or in any amendment
                  thereof, in any Prospectus, or in any amendment or supplement
                  thereto or (B) any blue sky application or other document or
                  any amendment or supplement thereto prepared or executed by
                  the Company (or based upon written information furnished by or
                  on behalf of the Company expressly for use in such blue sky
                  application or other document or amendment on supplement)
                  filed in any jurisdiction specifically for the purpose of
                  qualifying any or all of the Transfer Restricted Securities
                  under the securities law of any state or other jurisdiction
                  (such application or document being hereinafter called a "BLUE
                  SKY APPLICATION"); or

                           (ii)     the omission or alleged omission to state
                  therein any material fact required to be stated therein or
                  necessary to make the statements therein, in the light of the
                  circumstances under which they were made, not misleading,

<PAGE>

                                                                              17

and agrees to reimburse each Indemnified Holder promptly upon demand for any
legal or other expenses reasonably incurred by such Indemnified Holder in
connection with investigating, defending, settling, compromising or paying any
such loss, claim, damage, liability, expense or action; provided, however, that
the Company shall not be liable in any such case to the extent that any such
loss, claim, damage, liability or expense arises out of, or is based upon, any
untrue statement or alleged untrue statement or omission or alleged omission
made in reliance upon and in conformity with written information furnished to
the Company by or on behalf of such Holder (or its related Indemnified Holder)
specifically for use therein. The foregoing indemnity agreement is in addition
to any liability which the Company may otherwise have.

                  (b)      Each Holder, severally and not jointly, agrees to
         indemnify and hold harmless the Company, its directors, officers and
         employees and each person, if any, who controls the Company within the
         meaning of the Securities Act or the Exchange Act to the same extent as
         the foregoing indemnity from the Company to each such Holder, but only
         with reference to written information relating to such Holder furnished
         to the Company by or on behalf of such Holder specifically for
         inclusion in the documents referred to in the foregoing indemnity. This
         indemnity agreement set forth in this Section shall be in addition to
         any liabilities which any such Holder may otherwise have. In no event
         shall any Holder, its directors, officers or any person who controls
         such Holder be liable or responsible for any amount in excess of the
         amount by which the total amount received by such Holder with respect
         to its sale of Transfer Restricted Securities pursuant to a Shelf
         Registration Statement exceeds (i) the amount paid by such Holder for
         such Transfer Restricted Securities and (ii) the amount of any damages
         that such Holder, its directors, officers or any person who controls
         such Holder has otherwise been required to pay by reason of such untrue
         or alleged untrue statement or omission or alleged omission.

                           (i)      Promptly after receipt by an indemnified
                  party under this Section 6 of notice of any claim or the
                  commencement of any action, the indemnified party shall, if a
                  claim in respect thereof is to be made against the
                  indemnifying party under this Section 6, notify the
                  indemnifying party in writing of the claim or the commencement
                  of that action; provided, however, that the failure to notify
                  the indemnifying party shall not relieve it from any liability
                  which it may have under this Section 6 except to the extent it
                  has been materially prejudiced by such failure and, provided,
                  further, that the failure to notify the indemnifying party
                  shall not relieve it from any liability which it may have to
                  an indemnified party otherwise than under this Section 6. If
                  any such claim or action shall be brought against an
                  indemnified party, and it shall notify the indemnifying party
                  thereof, the indemnifying party shall be entitled to
                  participate therein and, to the extent that it wishes,

<PAGE>

                                                                              18

                  jointly with any other similarly notified indemnifying party,
                  to assume the defense thereof with counsel satisfactory to the
                  indemnified party. After notice from the indemnifying party to
                  the indemnified party of its election to assume the defense of
                  such claim or action, the indemnifying party shall not be
                  liable to the indemnified party under this Section 6 for any
                  legal or other expenses subsequently incurred by the
                  indemnified party in connection with the defense thereof other
                  than reasonable costs of investigation; provided, however,
                  that the Holders shall have the right to employ a single
                  counsel to represent jointly the Holders and their officers,
                  employees and controlling persons who may be subject to
                  liability arising out of any claim in respect of which
                  indemnity may be sought by the Holders against the Company
                  under this Section 6 if the Holders seeking indemnification
                  shall have been advised by legal counsel that there may be one
                  or more legal defenses available to such Holders and their
                  respective officers, employees and controlling persons that
                  are different from or additional to those available to the
                  Company, and in that event, the fees and expenses of such
                  separate counsel shall be paid by the Company.

                  (c)      The indemnifying party under this Section shall not
         be liable for any settlement of any proceeding effected without its
         written consent, which shall not be withheld unreasonably, but if
         settled with such consent or if there is a final judgment for the
         plaintiff, the indemnifying party agrees to indemnify the indemnified
         party against any loss, claim, damage, liability or expense by reason
         of such settlement or judgment. Notwithstanding the foregoing sentence,
         if at any time an indemnified party shall have requested an
         indemnifying party to reimburse the indemnified party for fees and
         expenses of counsel as contemplated by Section 6(c) hereof, the
         indemnifying party agrees that it shall be liable for any settlement of
         any proceeding effected without its written consent if (i) such
         settlement is entered into more than 30 days after receipt by such
         indemnifying party of the aforesaid request and (ii) such indemnifying
         party shall not have (A) reimbursed the indemnified party in accordance
         with such request prior to the date of such settlement; or (B)
         delivered notice to the indemnified party of its good faith objection
         to such claim of indemnification within than 30 days after receipt by
         such indemnifying party of the aforesaid request. No indemnifying party
         shall, without the prior written consent of the indemnified party
         (which consent shall not be unreasonably withheld), effect any
         settlement, compromise or consent to the entry of judgment in any
         pending or threatened action, suit or proceeding in respect of which
         any indemnified party is or could have been a party and indemnity was
         or could have been sought hereunder by such indemnified party, unless
         such settlement, compromise or consent (x) includes an unconditional
         release of such indemnified party from all

<PAGE>

                                                                              19

         liability on claims that are the subject matter of such action, suit or
         proceeding and (y) does not include a statement as to or an admission
         of fault, culpability or a failure to act by or on behalf of any
         indemnified party.

                  (d)      If the indemnification provided for in this Section 6
         shall for any reason be unavailable or insufficient to hold harmless an
         indemnified party under Section 6(a) or 6(b) in respect of any loss,
         claim, damage or liability (or action in respect thereof) referred to
         therein, each indemnifying party shall, in lieu of indemnifying such
         indemnified party, contribute to the amount paid or payable by such
         indemnified party as a result of such loss, claim, damage or liability
         (or action in respect thereof):

                           (i)      in such proportion as is appropriate to
                  reflect the relative benefits received by the Company from the
                  offering and sale of the Transfer Restricted Securities on the
                  one hand and a Holder with respect to the sale by such Holder
                  of the Transfer Restricted Securities on the other, or

                           (ii)     if the allocation provided by Section
                  (6)(d)(i) is not permitted by applicable law, in such
                  proportion as is appropriate to reflect not only the relative
                  benefits referred to in Section 6(d)(i) but also the relative
                  fault of the Company on the one hand and the Holders on the
                  other in connection with the statements or omissions or
                  alleged statements or alleged omissions that resulted in such
                  loss, claim, damage or liability (or action in respect
                  thereof), as well as any other relevant equitable
                  considerations.

The relative benefits received by the Company on the one hand and a Holder on
the other with respect to such offering and such sale shall be deemed to be in
the same proportion as the total net proceeds from the offering of the
Debentures purchased under the Purchase Agreement (before deducting expenses)
received by the Company, on the one hand, bear to the total proceeds received by
such Holder with respect to its sale of Transfer Restricted Securities on the
other. The relative fault of the parties shall be determined by reference to
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or the Holders on the other, the intent
of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
each Holder agree that it would not be just and equitable if the amount of
contribution pursuant to this Section 6(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the first sentence of this paragraph
(d).

         The amount paid or payable by an indemnified party as a result of the
loss, claim, damage or liability, or action in respect thereof, referred to
above in this

<PAGE>

                                                                              20

Section 6 shall be deemed to include, for purposes of this Section
6, any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending or preparing to defend any such
action or claim.

         Notwithstanding the provisions of this Section 6, no Holder shall be
required to contribute any amount in excess of the amount by which the total
price at which the Transfer Restricted Securities purchased by it were resold
exceeds the amount of any damages which such Holder has otherwise been required
to pay by reason of any untrue or alleged untrue statement or omission or
alleged omission. No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation. The Holders' obligations to contribute as provided in this
Section 6(d) are several and not joint.

                  (e)      The provisions of this Section 6 shall remain in full
         force and effect, regardless of any investigation made by or on behalf
         of any Holder or the Company or any of the officers, directors or
         controlling persons referred to in Section 6 hereof, and will survive
         the sale by a Holder of Transfer Restricted Securities.

         7.       Rule 144A and Rule 144. The Company agrees with each Holder,
for so long as any Transfer Restricted Securities remain outstanding and during
any period in which the Company (i) is not subject to Section 13 or 15(d) of the
Exchange Act, to make available, upon request of any Holder, to such Holder or
beneficial owner of Transfer Restricted Securities in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted Securities
designated by such Holder or beneficial owner, the information required by Rule
144A(d)(4) under the Securities Act in order to permit resales of such Transfer
Restricted Securities pursuant to Rule 144A, and (ii) is subject to Section 13
or 15 (d) of the Exchange Act, to make all filings required thereby in a timely
manner in order to permit resales of such Transfer Restricted Securities
pursuant to Rule 144.

         8.       No Participation In Underwritten Registrations. No Holder may
participate in any Underwritten Registration hereunder.

         9.       Miscellaneous.

                  (a)      Remedies. The Company acknowledges and agrees that
         any failure by the Company to comply with its obligations under Section
         2 hereof may result in material irreparable injury to the Initial
         Purchasers or the Holders for which there is no adequate remedy at law,
         that it will not be possible to measure damages for such injuries
         precisely, and that, in the event of any such failure, the Initial
         Purchasers or any Holder may obtain such relief as may be required to
         specifically enforce the Company's obligations under Section 2 hereof.
         The Company further agrees to waive

<PAGE>

                                                                              21

         the defense in any action for specific performance that a remedy at law
         would be adequate.

                  (b)      Actions Affecting Transfer Restricted Securities. The
         Company shall not, directly or indirectly, take any action with respect
         to the Transfer Restricted Securities as a class that would adversely
         affect the ability of the Holders of Transfer Restricted Securities to
         include such Transfer Restricted Securities in a registration
         undertaken pursuant to this Agreement.

                  (c)      No Inconsistent Agreements. The Company has not, as
         of the date hereof, entered into, nor shall it, on or after the date
         hereof, enter into, any agreement with respect to its securities that
         is inconsistent with the rights granted to the Holders in this
         Agreement or otherwise conflicts with the provisions hereof. In
         addition, the Company shall not on or after the date hereof grant to
         any of its securityholders (other than the Holders of Transfer
         Restricted Securities in such capacity) the right to include any of its
         securities in the Shelf Registration Statement provided for in this
         Agreement other than the Transfer Restricted Securities.

                  (d)      Amendments and Waivers. This Agreement may not be
         amended, modified or supplemented, and waivers or consents to or
         departures from the provisions hereof may not be given, unless the
         Company has obtained the written consent of a Majority of Holders;
         provided, however, that with respect to any matter that directly or
         indirectly adversely affects the rights of any Initial Purchaser
         hereunder, the Company shall obtain the written consent of each such
         Initial Purchaser against which such amendment, qualification,
         supplement, waiver or consent is to be effective. Notwithstanding the
         foregoing (except the foregoing proviso), a waiver or consent to depart
         from the provisions hereof, with respect to a matter, which relates
         exclusively to the rights of Holders whose securities are being sold
         pursuant to a Shelf Registration Statement and does not directly or
         indirectly adversely affect the rights of other Holders, may be given
         by the Majority Holders, determined on the basis of Debentures being
         sold rather than registered under such Shelf Registration Statement.

                  (e)      Notices. All notices and other communications
         provided for or permitted hereunder shall be made in writing by hand
         delivery, first class mail (registered or certified, return receipt
         requested), telex, facsimile transmission, or air courier guaranteeing
         overnight delivery:

                           (i)      if to a Holder, at the address set forth on
                  the records of the registrar under the Indenture or the
                  transfer agent of the Common Stock, as the case may be; and

<PAGE>

                                                                              22

                           (ii)     if to the Company, initially at its address
                  set forth in the Purchase Agreement.

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

         Any party hereto may change the address for receipt of communications
by giving written notice to the others.

                  (f)      Successors and Assigns. This Agreement shall inure to
         the benefit of and be binding upon the successors and assigns of each
         of the parties, including without limitation and without the need for
         an express assignment, subsequent Holders of Transfer Restricted
         Securities. The Company hereby agrees to extend the benefit of this
         Agreement to any Holder and any such Holder may specifically enforce
         the provisions of this Agreement as if an original party hereto.

                  (g)      Counterparts. This Agreement may be executed in any
         number of counterparts and by the parties hereto in separate
         counterparts, each of which when so executed shall be deemed to be an
         original and all of which taken together shall constitute one and the
         same agreement.

                  (h)      Debentures Held by the Company or Their Affiliates.
         Whenever the consent or approval of Holders of a specified percentage
         of Transfer Restricted Securities is required hereunder, Transfer
         Restricted Securities held by the Company or its Affiliates (other than
         subsequent Holders if such subsequent Holders are deemed to be
         Affiliates solely by reason of their holding of such Debentures) shall
         not be counted in determining whether such consent or approval was
         given by the Holders of such required percentage.

                  (i)      Headings. The headings in this Agreement are for
         convenience of reference only and shall not limit or otherwise affect
         the meaning hereof.

                  (j)      Governing Law. This Agreement shall be governed by
         and construed in accordance with the law of the State of New York.

                  (k)      Severability. If any one or more of the provisions
         contained herein, or the application thereof in any circumstance, is
         held invalid, illegal or unenforceable, the validity, legality and
         enforceability of any such provision in every other respect and of the
         remaining provisions contained herein shall not be affected or impaired
         thereby, it being

<PAGE>

                                                                              23

         intended that all of the rights and privileges of the parties shall be
         enforceable to the fullest extent permitted by law.

                  (l)      Entire Agreement. This Agreement is intended by the
         parties as a final expression of their agreement and intended to be a
         complete and exclusive statement of the agreement and understanding of
         the parties hereto in respect of the subject matter contained herein.
         There are no restrictions, promises, warranties or undertakings, other
         than those set forth or referred to herein with respect to the
         registration rights granted by the Company with respect to the Transfer
         Restricted Securities. This Agreement supersedes all prior agreements
         and understandings between the parties with respect to such subject
         matter.

<PAGE>

                                                                              24

         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.

                                            QUANTA SERVICES, INC.

                                            By  /s/ DANA A. GORDON
                                                --------------------------------
                                                Name:  Dana A. Gordon
                                                Title: Vice President, General
                                                       Counsel and Secretary

                                            BANC OF AMERICA SECURITIES LLC
                                            J.P. MORGAN SECURITIES, INC.
                                            Acting severally on behalf of
                                            themselves and the several Initial
                                            Purchasers

                                            By BANC OF AMERICA SECURITIES LLC

                                            By /s/ DEREK DILLON
                                               ---------------------------------
                                               Authorized Representative
                                               Derek Dillon, Managing Director

                                            By J.P. MORGAN SECURITIES INC.

                                            By  /s/ JEFF ZAJKOWSKI
                                               ---------------------------------
                                               Authorized Representative
                                               Jeff Zajkowski, Managing Director

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>5
<FILENAME>h10560exv10w2.txt
<DESCRIPTION>FOURTH AMENDED SECURED CREDIT AGREEMENT
<TEXT>
<PAGE>

                                                                    EXHIBIT 10.2

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

              FOURTH AMENDED AND RESTATED SECURED CREDIT AGREEMENT

                                   DATED AS OF

                                NOVEMBER 12, 2003

                                      AMONG

                       QUANTA SERVICES, INC., AS BORROWER

                                       AND

              THE FINANCIAL INSTITUTIONS PARTIES HERETO, AS LENDERS

                                       AND

                             BANK OF AMERICA, N.A.,
                             AS ADMINISTRATIVE AGENT

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

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                              Page
                                                                                                              ----
<S>                                                                                                           <C>
SECTION 1.       DEFINITIONS; INTERPRETATION............................................................        1
     Section 1.1           Definitions..................................................................        1
     Section 1.2           Interpretation...............................................................       14

SECTION 2.       THE CREDIT FACILITY....................................................................       15
     Section 2.1           Term Loan....................................................................       15
     Section 2.2           Letters of Credit............................................................       15
     Section 2.3           Types of Loans and Minimum Borrowing Amounts.................................       18
     Section 2.4           Manner of Borrowing..........................................................       18
     Section 2.5           Interest Periods.............................................................       19
     Section 2.6           Interest Payments............................................................       19
     Section 2.7           Default Rates................................................................       20
     Section 2.8           Maturity of Loans............................................................       21
     Section 2.9           Optional Prepayments.........................................................       21
     Section 2.10          Mandatory Prepayments of Loans...............................................       22
     Section 2.11          The Notes....................................................................       22
     Section 2.12          Breakage Fees................................................................       22
     Section 2.13          L/C Commitment Terminations..................................................       23
     Section 2.14          Agent Reliance on Borrower Payment...........................................       23

SECTION 3.       FEES AND PAYMENTS......................................................................       24
     Section 3.1           Fees.........................................................................       24
     Section 3.2           Place and Application of Payments............................................       24
     Section 3.3           Withholding Taxes............................................................       24

SECTION 4.       CONDITIONS PRECEDENT...................................................................       26
     Section 4.1           Conditions Precedent to Initial Borrowing....................................       26
     Section 4.2           Conditions Precedent to all Loans............................................       28

SECTION 5.       REPRESENTATIONS AND WARRANTIES.........................................................       29
     Section 5.1           Organization.................................................................       29
     Section 5.2           Power and Authority; Validity................................................       30
     Section 5.3           No Violation.................................................................       30
     Section 5.4           Litigation...................................................................       30
     Section 5.5           Use of Proceeds; Margin Regulations..........................................       30
     Section 5.6           Investment Company Act.......................................................       31
     Section 5.7           Public Utility Holding Company Act...........................................       31
     Section 5.8           True and Complete Disclosure.................................................       31
     Section 5.9           Financial Statements.........................................................       31
     Section 5.10          No Material Adverse Change...................................................       31
     Section 5.11          Labor Controversies..........................................................       31
     Section 5.12          Taxes........................................................................       31
     Section 5.13          ERISA........................................................................       32
</TABLE>

                                       i

<PAGE>

<TABLE>
<S>                                                                                                            <C>
     Section 5.14          Consents.....................................................................       32
     Section 5.15          Capitalization...............................................................       32
     Section 5.16          Ownership of Property........................................................       32
     Section 5.17          Compliance with Statutes.....................................................       32
     Section 5.18          Environmental Matters........................................................       33
     Section 5.19          [Intentionally Omitted]......................................................       33
     Section 5.20          Existing Indebtedness and Liens..............................................       33

SECTION 6.       COVENANTS..............................................................................       33
     Section 6.1           Existence....................................................................       33
     Section 6.2           Maintenance..................................................................       34
     Section 6.3           Taxes........................................................................       34
     Section 6.4           ERISA........................................................................       34
     Section 6.5           Insurance....................................................................       35
     Section 6.6           Financial Reports and Other Information......................................       35
     Section 6.7           Lenders' Inspection Rights...................................................       36
     Section 6.8           Conduct of Business..........................................................       36
     Section 6.9           New Subsidiaries and Additional Collateral...................................       36
     Section 6.10          Dividends and Negative Pledges...............................................       37
     Section 6.11          Restrictions on Fundamental Changes..........................................       37
     Section 6.12          Environmental Laws...........................................................       38
     Section 6.13          Liens........................................................................       39
     Section 6.14          Indebtedness.................................................................       40
     Section 6.15          Loans, Advances and Investments..............................................       41
     Section 6.16          Transfer of Assets...........................................................       42
     Section 6.17          Transactions with Affiliates.................................................       42
     Section 6.18          Compliance with Laws.........................................................       42
     Section 6.19          Capital Expenditures.........................................................       43
     Section 6.20          Minimum Consolidated Net Worth...............................................       43
     Section 6.21          Minimum Interest Coverage Ratio..............................................       43
     Section 6.22          Net Funded Debt to EBITDA Ratio..............................................       44
     Section 6.23          Net Senior Funded Debt to EBITDA.............................................       44
     Section 6.24          Minimum Asset Coverage.......................................................       44
     Section 6.25          Subordinated Debt Investment.................................................       44

SECTION 7.       EVENTS OF DEFAULT AND REMEDIES.........................................................       44
     Section 7.1           Events of Default............................................................       44
     Section 7.2           Non-Bankruptcy Defaults......................................................       46
     Section 7.3           Bankruptcy Defaults..........................................................       47
     Section 7.4           Collateral for Undrawn Letters of Credit.....................................       47
     Section 7.5           Notice of Default............................................................       48
     Section 7.6           Application of Proceeds......................................................       48

SECTION 8.       CHANGE IN CIRCUMSTANCES................................................................       48
     Section 8.1           Change of Law................................................................       48
     Section 8.2           Unavailability of Deposits or Inability to Ascertain LIBOR Rate..............       48
</TABLE>

                                       ii

<PAGE>

<TABLE>
<S>                                                                                                            <C>
     Section 8.3           Increased Cost and Reduced Return............................................       48
     Section 8.4           Lending Offices..............................................................       50
     Section 8.5           Discretion of Lender as to Manner of Funding.................................       50
     Section 8.6           Substitution of Lender.......................................................       50

SECTION 9.       THE AGENT..............................................................................       51
     Section 9.1           Appointment and Authorization................................................       51
     Section 9.2           Rights and Powers............................................................       51
     Section 9.3           Action by Agent..............................................................       51
     Section 9.4           Consultation with Experts....................................................       51
     Section 9.5           Indemnification Provisions; Credit Decision..................................       51
     Section 9.6           Indemnity....................................................................       52
     Section 9.7           Resignation of Agent and Successor Agent.....................................       52

SECTION 10.      MISCELLANEOUS..........................................................................       53
     Section 10.1          No Waiver of Rights..........................................................       53
     Section 10.2          Non-Business Day.............................................................       53
     Section 10.3          Documentary Taxes............................................................       53
     Section 10.4          Survival of Representations..................................................       53
     Section 10.5          Survival of Indemnities......................................................       53
     Section 10.6          Setoff.......................................................................       53
     Section 10.7          Notices......................................................................       54
     Section 10.8          Counterparts.................................................................       55
     Section 10.9          Successors and Assigns.......................................................       55
     Section 10.10         Sales and Transfers of Loans and Notes; Participations in Loans and
                           Notes........................................................................       55
     Section 10.11         Amendments...................................................................       58
     Section 10.12         Headings.....................................................................       58
     Section 10.13         Legal Fees, Other Costs and Indemnification..................................       58
     Section 10.14         Governing Law; Submission to Jurisdiction; Waiver of Jury Trial..............       59
     Section 10.15         Confidentiality..............................................................       61
     Section 10.16         Severability.................................................................       61
     Section 10.17         Change in Accounting Principles or Tax Laws..................................       61
     Section 10.18         Refinancing of Senior Notes and Loans Under Existing Credit Agreement........       62
     Section 10.19         Effectiveness................................................................       62
     Section 10.20         Notice.......................................................................       62
</TABLE>

EXHIBITS

2.11     -    Form of Note
4.1      -    Financial Condition Certificate
6.6      -    Compliance Certificate
10.10    -    Form of Assignment Agreement

                                      iii

<PAGE>

SCHEDULES

Schedule 1.1     Initial Commitments
Schedule 2.2     Existing Letters of Credit
Schedule 5.1     List of Subsidiaries
Schedule 5.4     List of Litigation
Schedule 5.12    List of Outstanding Tax Issues
Schedule 5.20    List of Existing Liens and Indebtedness
Schedule 6.13    List of Permitted Liens and Indebtedness

                                       iv

<PAGE>

         FOURTH AMENDED AND RESTATED SECURED CREDIT AGREEMENT dated as of
November 12, 2003, between Quanta Services, Inc., a Delaware corporation (the
"BORROWER"), the lenders from time to time parties hereto (each a "LENDER" and
collectively, the "LENDERS"), and Bank of America, N.A., as administrative agent
for the Lenders (in such capacity, the "AGENT").

                                    RECITALS

         A.       The Borrower, certain of the Lenders and Bank of America,
N.A., as agent ("EXISTING AGENT") previously entered into that certain Third
Amended and Restated Secured Credit Agreement dated as of June 14, 1999 (as
amended prior to the date hereof, the "EXISTING CREDIT AGREEMENT").

         B.       The parties hereto desire to amend and restate such Existing
Credit Agreement in its entirety and refinance the "Obligations" thereunder by
providing an L/C Commitment Amount of $120,000,000 and a single advance term
loan in the amount of $60,000,000.

         NOW, THEREFORE, in consideration of the premises and of the mutual
covenants contained in this Agreement, the parties to this Agreement agree to
amend and restate the Existing Credit Agreement in its entirety, as follows:

SECTION 1. DEFINITIONS; INTERPRETATION.

         Section 1.1. Definitions. Unless otherwise defined in this Agreement,
the following terms shall have the following meanings:

         "ACQUISITION" means, a direct or indirect purchase by the Borrower or
any of its Subsidiaries for cash, stock, or other securities or property,
whether in one or more related transactions, of all or substantially all of the
assets or more than 50% of voting securities or other equity interests of a
Person or a business unit, division or group of a Person.

         "ADJUSTED LIBOR RATE" means, for any LIBOR Loan, a rate per annum
determined in accordance with the following formula:

         Adjusted LIBOR Rate  =     LIBOR Rate
                                 -------------------
                                 1.00 - Eurodollar Reserve Percentage

         "AFFILIATE" means, for any Person, (i) any other Person that directly
or indirectly through one or more intermediaries controls, or is under common
control with, or is controlled by, such Person, and (ii) any other Person owning
beneficially or controlling ten percent (10%) or more of the equity interests in
such Person; provided that any investor in connection with any Subordinated Debt
Investment shall not be considered an Affiliate hereunder. As used in this
definition, "CONTROL" means the power, directly or indirectly, to direct or
cause the direction of management or policies of a Person (through ownership of
voting securities or other equity interests, by contract or otherwise).

         "AGENT" means Bank of America, N.A. acting in its capacity as
administrative agent for the Lenders, and any successor agent appointed
hereunder pursuant to SECTION 9.7.

                                        1

<PAGE>

         "AGREEMENT" means this Credit Agreement, as amended, restated or
supplemented from time to time.

         "APPLICABLE MARGIN" means, for Base Rate Loans, 1.50% per annum, and
for LIBOR Loans, 3.25% per annum.

         "APPLICATION" means an application for a Letter of Credit in the form
from time to time used by Agent's letter of credit department.

         "ASSIGNMENT AGREEMENT" means an agreement in substantially the form of
EXHIBIT 10.10 whereby a Lender conveys part or all of its L/C Commitments and
Loans and participations in Letters of Credit to another Person that thereupon
becomes a Lender, or that increases its L/C Commitments, outstanding Loans and
outstanding participations in Letters of Credit pursuant to SECTION 10.10.

         "BASE RATE" means, for any day, the higher of (i) the fluctuating
commercial loan rate announced by the Agent from time to time as its base rate
for Dollar loans in the United States of America in effect on such day (which
base rate may not be the lowest rate charged by the Agent on loans to any of its
customers), or (ii) the Federal Funds Rate plus one-half of one percent (0.5%)
per annum, with any change in the Base Rate resulting from a change in either
such rate to be effective on the date of the relevant change.

         "BASE RATE LOAN" means any portion of the Term Loan bearing interest
prior to maturity at the Base Rate plus the Applicable Margin.

         "BENEFICIAL OWNERSHIP," and "BENEFICIAL OWNER" shall have the meanings
assigned to them in Rule 13d-3 under the Exchange Act in effect on the date of
this Agreement.

         "BORROWER" means Quanta Services, Inc., a Delaware corporation.

         "BUSINESS DAY" means any day other than a Saturday or Sunday on which
banks are not authorized or required to close in Houston, Texas, and, if the
applicable Business Day relates to the continuation of, conversion into or
payment on a LIBOR Loan, on which banks are dealing in Dollar deposits in the
interbank eurocurrency market in London, England.

         "CAPITAL EXPENDITURES" means, for any period, the sum, without
duplication, of all expenditures of the Borrower and its Subsidiaries for fixed
or capital assets made during such period which, in accordance with GAAP, are
required to be classified as capital expenditures, in each case excluding all
such expenditures incurred by any entity or business acquired in an Acquisition
prior to the date of such Acquisition.

         "CAPITALIZED LEASE OBLIGATIONS" means, for any Person, the amount of
such Person's liabilities under all leases of real or personal property (or any
interest therein) which is required to be capitalized on the balance sheet of
such Person as determined in accordance with GAAP.

         "CASH COLLATERAL SECURITY AGREEMENT" means that certain Security
Agreement of the Borrower dated as of October 31, 2003, in favor of the Existing
Agent pursuant to which the Borrower deposited with the Existing Agent certain
proceeds of the 2003 Convertible

                                       2

<PAGE>

Subordinated Notes as security for the "Obligations" under the Existing Credit
Agreement, as amended, restated, or supplemented from time to time.

         "CASH EQUIVALENTS" means (i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof having maturities of not more than twelve (12) months
from the date of acquisition; (ii) U.S. Dollar denominated time deposits and
certificates of deposit maturing within one (1) year from the date of
acquisition thereof with any Lender or any other financial institution whose
short-term senior unsecured debt rating is at least A-1 from S&P or P-1 from
Moody's; (iii) LIBOR denominated time deposits and certificates of deposit
maturing within six (6) months from the date of acquisition thereof with any
Lender or any other financial institution whose short-term senior unsecured debt
rating is at least A-1 from S&P or P-1 from Moody's; (iv) commercial paper or
Eurocommercial paper with a rating of at least A-1 from S&P or P-1 from Moody's,
with maturities of not more than twelve (12) months from the date of
acquisition; (v) repurchase obligations entered into with any Lender or any
other financial institution whose short-term senior unsecured debt rating is at
least A-1 from S&P or P-1 from Moody's, which are secured by a fully perfected
security interest in any obligation of the type described in (i) above and has a
market value as of the time such repurchase is entered into of not less than
100% of the repurchase obligation of such Lender or such other Person
thereunder; (vi) marketable direct obligations issued by any state of the United
States of America or any political subdivision of any such state or any public
instrumentality thereof maturing within twelve (12) months from the date of
acquisition thereof or providing for the resetting of the interest rate
applicable thereto not less often than annually and, at the time of acquisition,
having one of the two highest ratings obtainable from either S&P or Moody's; and
(vii) money market funds which have at least $1,000,000,000 in assets and which
invest primarily in securities of the types described in clauses (i) through
(vi) above.

         "CHANGE IN CONTROL" shall be deemed to have occurred if (i) any Person
acquires, directly or indirectly, the Beneficial Ownership of any voting
security of the Borrower and immediately after such acquisition such Person is,
directly or indirectly, the Beneficial Owner of voting securities representing
50% or more of the total voting power of all the then outstanding voting
securities of the Borrower entitled to vote generally in the election of
directors; or (ii) individuals who on November 12, 2003, constituted the
Borrower's Board of Directors, or their approved successors, cease for any
reason to constitute at least a majority of the Borrower's Board of Directors.
An approved successor is a new director elected when the election or nomination
for the election by the Borrower's stockholders of such new director was
approved by vote of at least two-thirds of the directors then still in office
who were directors on November 12, 2003, or their approved successors.

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

         "COLLATERAL" means all property and assets of the Borrower and its
Subsidiaries in which the Agent is granted a Lien for the benefit of the
Lenders.

         "COLLATERAL ACCOUNT" means the cash collateral account for outstanding
undrawn Letters of Credit as defined in SECTION 7.4(b).

         "COMMITMENT TERMINATION DATE" means the earliest of (i) the Maturity
Date; (ii) the date on which the L/C Commitments are terminated in full or
reduced to zero pursuant to

                                       3

<PAGE>

SECTION 2.13; or (iii) the occurrence of any Event of Default described in
SECTION 7.1(f) or (g) with respect to the Borrower or the occurrence and
continuance of any other Event of Default and either (x) the declaration of the
Loans to be due and payable pursuant to SECTION 7.2, or (y) in the absence of
such declaration, the giving of written notice by the Agent, acting at the
direction of the Majority Lenders, to the Borrower pursuant to SECTION 7.2 that
the L/C Commitments have been terminated.

         "COMPLIANCE CERTIFICATE" means a certificate substantially in the form
of EXHIBIT 6.6.

         "CONSOLIDATED INTEREST EXPENSE" means, for any period, total interest
expense of the Borrower and its Subsidiaries on a consolidated basis for such
period in connection with Indebtedness, determined in accordance with GAAP.

         Notwithstanding any of the paragraph above to the contrary, (a) for the
fiscal quarter ending December 31, 2003, Consolidated Interest Expense shall be
equal to $21,500,000, (b) for any fiscal quarter ending during the period
commencing March 31, 2004 and ending September 30, 2004, Consolidated Interest
Expense shall be equal to (i) the amount set forth in the table below for the
applicable fiscal quarter set forth in the table below plus (ii) "Consolidated
Interest Expense" (as defined in the paragraph above) for the period commencing
January 1, 2004 and ending on the last day of such applicable fiscal quarter;
and (c) for any fiscal quarter ending after September 30, 2004, Consolidated
Interest Expense shall be equal to "Consolidated Interest Expense" (as defined
in the paragraph above) for the four fiscal quarters then ending.

<TABLE>
<CAPTION>
FISCAL QUARTER ENDED                  APPLICABLE AMOUNT
-------------------------------------------------------
<S>                                   <C>
March 31, 2004                        $      16,125,000
-------------------------------------------------------
June 30, 2004                         $      10,750,000
-------------------------------------------------------
September 30, 2004                    $      5,375,000
-------------------------------------------------------
</TABLE>

         "CONSOLIDATED NET ACCOUNTS" means, as of any date of determination,
accounts receivable set out in the consolidated balance sheet of the Borrower
and its Subsidiaries as accounts receivable, net of allowances, and in each
case, as determined in accordance with GAAP.

         "CONSOLIDATED NET ASSETS" means, as of any date of determination, the
sum of (a) Consolidated Net Accounts, plus (b) Consolidated Net PP&E.

         "CONSOLIDATED NET INCOME" means, for any period, the net income (or
loss), after provision for taxes, of the Borrower and its Subsidiaries on a
consolidated basis for such period, determined in accordance with GAAP.

         "CONSOLIDATED NET PP&E" means, as of any date of determination, the
difference of (a) total property, plant and equipment of the Borrower and its
Subsidiaries set out in the consolidated balance sheet of the Borrower and its
Subsidiaries, minus (b) accumulated depreciation expense attributed to such
items, set out in the consolidated balance sheet of the

                                       4

<PAGE>

Borrower and its Subsidiaries as "property and equipment, net", and in each
case, as determined in accordance with GAAP.

         "CONSOLIDATED NET WORTH" means, as of any date of determination, the
Borrower's consolidated stockholders equity determined in accordance with GAAP.

         "CONVERTIBLE SUBORDINATED NOTES" means the notes, guarantees, and all
other obligations now or hereafter arising under, or pursuant to, the First
Supplemental Indenture, including, without limitation, the "2007 Notes" (as
defined in the First Supplemental Indenture).

         "CREDIT DOCUMENTS" means this Agreement, the Notes, the Existing
Subsidiary Guaranties (and any ratifications thereof), the Existing Pledge
Agreements (and any ratifications thereof), the Existing Security Agreements
(and any ratifications thereof), the Existing Patent Collateral Assignments (and
any ratifications thereof), the Applications, Interest Rate Protection
Agreements with any Lender or any Affiliate of Lender, and any other pledge
agreements, documents or instruments now or hereafter executed by the Borrower
or any of its Subsidiaries in connection with this Agreement.

         "DEFAULT" means any event or condition the occurrence of which would,
with the passage of time or the giving of notice, or both, constitute an Event
of Default.

         "DOLLAR" and "U.S. DOLLAR" and the sign "$" means lawful money of the
United States of America.

         "EBIT" means, for any period, the sum of Consolidated Net Income plus,
without duplication, each of the following to the extent actually deducted in
determining Consolidated Net Income: (a) Consolidated Interest Expense; (b)
provisions for taxes based on income or revenues; (c) provisions made in
accordance with SFAS 142 or SFAS 144, which taken together with all other
charges previously taken in connection with SFAS 142 or SFAS 144, do not, in the
aggregate, exceed $850,000,000; (d) to the extent applicable, Permitted Charges;
and (e) Non-Cash Charges, in each case calculated on a consolidated basis for
the Borrower and its Subsidiaries and as determined in accordance with GAAP.

         Notwithstanding any of the paragraph above to the contrary, (a) for any
fiscal quarter ending during the period commencing December 31, 2003 and ending
June 30, 2004, EBIT shall be equal to Historical EBIT plus "EBIT" (as defined in
the paragraph above) for the period commencing October 1, 2003 and ending on
last day of the applicable fiscal quarter; and (b) for any fiscal quarter ending
after June 30, 2004, EBIT shall be equal to "EBIT" (as defined in the paragraph
above) for the four fiscal quarters then ending.

         "EBITDA" means, for any period (using the historical financial results
of any business acquired in an Acquisition through the Effective Date, to the
extent applicable, all on a pro forma basis, consistent with SEC regulations),
the sum of Consolidated Net Income plus, without duplication, each of the
following to the extent actually deducted in determining Consolidated Net
Income: (a) Consolidated Interest Expense; (b) provisions for taxes based on
income or revenues; (c) the amount of all depreciation and amortization expense
deducted in determining Consolidated Net Income; (d) charges taken in accordance
with SFAS 142 or SFAS 144, which when taken together with all other charges
previously taken in connection with SFAS 142 or SFAS 144, do not, in the
aggregate, exceed $850,000,000; (e) without duplication, Permitted

                                       5

<PAGE>

Charges; and (f) without duplication, Non-Cash Charges, all calculated on a
consolidated basis for the Borrower and its Subsidiaries and as determined in
accordance with GAAP. Upon the consummation of any Acquisition after the
Effective Date, EBITDA may be calculated, subject to the immediately following
sentence, using a calculation which (y) includes the historical financial
results of the acquired business on a pro forma trailing four fiscal quarter
basis (consistent with SEC regulations), and (z) assumes that the consummation
of such Acquisition (and the incurrence, refinancing, or assumption of any
Indebtedness in connection with such Acquisition) occurred on the first day of
the trailing four fiscal quarter period. The foregoing adjustment to EBITDA to
take into account an Acquisition may only be made if the balance sheet and
statements of income, retained earnings, and cash flows of the acquired Person
(or the Person from whom the assets, securities or other equity interests were
acquired), are in compliance with SEC regulations and requirements regarding the
preparation and presentation of historical financial information and pro forma
financial information.

         Notwithstanding any of the paragraph above to the contrary, (a) for any
fiscal quarter ending during the period commencing December 31, 2003 and ending
June 30, 2004, EBITDA shall be equal to Historical EBITDA plus "EBITDA" (as
defined in the paragraph above) for the period commencing October 1, 2003 and
ending on last day of the applicable fiscal quarter; and (b) for any fiscal
quarter ending after June 30, 2004, EBITDA shall be equal to "EBITDA" (as
defined in the paragraph above) for the four fiscal quarters then ending.

         "EFFECTIVE DATE" means the date this Agreement becomes effective as
defined in SECTION 10.19.

         "ENVIRONMENTAL CLAIMS" means any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices of
non-compliance or violations, formal investigations or proceedings relating to
any Environmental Law ("CLAIMS") or any permit issued under any Environmental
Law, including, without limitation, (i) any and all Claims by governmental or
regulatory authorities for enforcement, cleanup, removal, response, remedial or
other actions or damages pursuant to any applicable Environmental Law, and (ii)
any and all Claims by any third party seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief resulting from
a release or threatened release of Hazardous Materials.

         "ENVIRONMENTAL LAW" means any federal, state or local statute, law,
rule, regulation, ordinance, code, policy or rule of common law now or hereafter
in effect, including any judicial or administrative order, consent, decree or
judgment relating to (i) the environment, (ii) health or safety in relation to
the environment or (iii) Hazardous Materials.

         "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.

         "EURODOLLAR RESERVE PERCENTAGE" means, with respect to each Interest
Period for a LIBOR Loan, a percentage (expressed as a decimal) equal to the
daily average during such Interest Period of the percentages in effect on each
day of such Interest Period, if any, as prescribed by the Board of Governors of
the Federal Reserve System (or any successor thereto), for determining the
maximum reserve requirements (including, without limitation, any supplemental,
marginal and emergency reserves) applicable to "Eurocurrency Liabilities"
pursuant to Regulation D of the Board of Governors of the Federal Reserve System
or any other

                                       6

<PAGE>

then applicable regulation of the Board of Governors which prescribes reserve
requirements applicable to "Eurocurrency Liabilities" as presently defined in
Regulation D.

         "EVENT OF DEFAULT" means any of the events or circumstances specified
as such in SECTION 7.1.

         "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended
from time to time, and the rules and regulations of the SEC promulgated
thereunder.

         "EXISTING AGENT" is defined in the Preamble.

         "EXISTING CREDIT AGREEMENT" is defined in the Preamble.

         "EXISTING L/Cs" means the one or more letters of credit issued by the
Existing Agent under the Existing Credit Agreement for the account of the
Borrower before the date of this Agreement and that are described on SCHEDULE
2.2.

         "EXISTING L/C OBLIGATIONS" means the total undrawn face amount of
outstanding Existing L/Cs.

         "EXISTING PATENT COLLATERAL ASSIGNMENT" means the patent collateral
assignment executed in connection with the Existing Credit Agreement, as
amended, restated or supplemented from time to time.

         "EXISTING PLEDGE AGREEMENTS" means each pledge agreement of the
Borrower and any of its Subsidiaries executed in connection with the Existing
Credit Agreement, as amended, restated or supplemented from time to time.

         "EXISTING SECURITY AGREEMENTS" means each security agreement of the
Borrower and any of its Subsidiaries executed in connection with the Existing
Credit Agreement, including without limitation the Cash Collateral Security
Agreement, as amended, restated or supplemented from time to time.

         "EXISTING SUBSIDIARY GUARANTY" means each Guaranty of each direct or
indirect domestic Subsidiary of the Borrower executed in connection with the
Existing Credit Agreement, as amended, restated or supplemented from time to
time.

         "FEDERAL FUNDS RATE" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/16th of 1%) equal to the weighted
average of the rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the next Business Day,
provided that (A) if such day is not a Business Day, the rate on such
transactions on the immediately preceding Business Day as so published on the
next Business Day shall apply, and (B) if no such rate is published on such next
Business Day, the rate for such day shall be the average of the offered rates
quoted to the Agent by two (2) federal funds brokers of recognized standing on
such day for such transactions as selected by the Agent.

         "FIRST SUPPLEMENTAL INDENTURE" means that certain First Supplemental
Indenture dated as of July 25, 2000, by the Borrower, as Issuer, to Chase Bank
of Texas, National Association, as

                                       7

<PAGE>

Trustee, executed and delivered pursuant to the Subordinated Indenture, as the
same may be amended, restated or supplemented from time to time.

         "FUNDED DEBT" means, as of any date of determination, the sum, without
duplication, of the following for the Borrower and its Subsidiaries: (i)
Indebtedness for borrowed money, all obligations evidenced by bonds, debentures,
notes or similar instruments, and purchase money obligations which in accordance
with GAAP would be shown on the consolidated balance sheet of the Borrower as a
liability, (ii) all L/C Obligations, and all reimbursement obligations relative
to the face amount of all other letters of credit issued for the account of the
Borrower or any of its Subsidiaries, and (iii) all Capitalized Lease
Obligations.

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

         "GUARANTOR" means each domestic Subsidiary of the Borrower listed on
SCHEDULE 5.1 and any other Subsidiary of the Borrower required to become a
Guarantor pursuant to SECTION 6.9.

         "GUARANTY" by any Person means all contractual obligations (other than
endorsements in the ordinary course of business of negotiable instruments for
deposit or collection or similar transactions in the ordinary course of
business) of such Person guarantying any Indebtedness, dividend or other
obligation (including, without limitation, obligations in connection with sales
of any property) of any other Person (the "PRIMARY OBLIGOR") in any manner,
whether directly or indirectly, including, without limitation, all obligations
incurred through an agreement, contingent or otherwise, by such Person: (i) to
purchase such Indebtedness or obligation, or to purchase any property or assets
constituting security therefor, primarily for the purpose of assuring the owner
of such Indebtedness or obligations of the ability of the primary obligor to
make payment of the Indebtedness or obligation; or (ii) to advance or supply
funds (x) for the purchase or payment of such Indebtedness or obligation, or (y)
to maintain working capital or other balance sheet condition, or otherwise to
advance or make available funds for the purchase or payment of such Indebtedness
or obligation, in each case primarily for the purpose of assuring the owner of
such Indebtedness or obligation of the ability of the primary obligor to make
payment of the Indebtedness or obligation; or (iii) to lease property or to
purchase securities or other property or services of the primary obligor
primarily for the purpose of assuring the owner of such Indebtedness or
obligation of the ability of the primary obligor to make payment of the
Indebtedness or obligation; or (iv) otherwise to assure the owner of the
Indebtedness or obligation of the primary obligor against loss in respect
thereof. For the purpose of all computations made under this Agreement, the
amount of a Guaranty in respect of any obligation shall be deemed to be equal to
the amount that would apply if such obligation were the direct obligation of
such Person rather than the primary obligor or, if less, the maximum aggregate
potential liability of such Person under the terms of the Guaranty.

         "HAZARDOUS MATERIAL" shall have the meaning assigned to the term
Hazardous Substance in the Comprehensive Environmental Response Compensation and
Liability Act of 1980, as

                                       8

<PAGE>

amended by the Superfund Amendments and Reauthorization Acts of 1986, and shall
include any substance defined as "HAZARDOUS" or "TOXIC" or words used in place
thereof under any Environmental Law applicable to the Borrower or any of its
Subsidiaries.

         "HIGHEST LAWFUL RATE" means the maximum nonusurious interest rate, if
any, that at any time or from time to time may be contracted for, taken,
reserved, charged or received on the Loans or the Reimbursement Obligations, or
under laws applicable to the Agent or any of the Lenders, which are presently in
effect or, to the extent allowed by applicable law, under such laws which may
hereafter be in effect and which allow a higher maximum nonusurious interest
rate than applicable laws now allow. Determination of the rate of interest for
the purpose of determining whether the Loans or the Reimbursement Obligations
are usurious under all applicable laws shall be made by amortizing, prorating,
allocating, and spreading, in equal parts during the period of the full stated
term of the Loans, all interest at any time contracted for, taken, reserved,
charged or received from the Borrower in connection with the Loans or the
Reimbursement Obligations, as applicable.

         "HISTORICAL EBIT" means the amount set forth in the table below for the
applicable fiscal quarter set forth in the table below:

<TABLE>
<CAPTION>
FISCAL QUARTER ENDED                                              HISTORICAL EBIT
------------------------------------------------------------------------------------------------
<S>                                                <C>
December 31, 2003 and March 31, 2004               $18,050,000  plus  EBIT  for  fiscal  quarter
                                                   ended 9-30-03
------------------------------------------------------------------------------------------------
June 30, 2004                                      EBIT for fiscal quarter ended 9-30-03
------------------------------------------------------------------------------------------------
</TABLE>

         "HISTORICAL EBITDA" means the amount set forth in the table below for
the applicable fiscal quarter set forth in the table below:

<TABLE>
<CAPTION>
FISCAL QUARTER ENDED                          HISTORICAL EBITDA
-----------------------------------------------------------------------------
<S>                             <C>
December 31, 2003               $48,550,000  plus  EBITDA for fiscal  quarter
                                ended 9-30-03
-----------------------------------------------------------------------------
March 31, 2004                  $33,750,000  plus  EBITDA for fiscal  quarter
                                ended 9-30-03
-----------------------------------------------------------------------------
June 30, 2004                   EBITDA for fiscal quarter ended 9-30-03
-----------------------------------------------------------------------------
</TABLE>

         "INDEBTEDNESS" means, for any Person, the following obligations of such
Person, without duplication: (i) obligations of such Person for borrowed money;
(ii) obligations of such Person representing the deferred purchase price of
property or services other than accounts payable arising in the ordinary course
of business and other than amounts which are being contested in good faith and
for which reserves in conformity with GAAP have been provided; (iii) obligations

                                       9

<PAGE>

of such Person evidenced by bonds, notes, bankers acceptances, debentures or
other similar instruments of such Person or reimbursement obligations or other
obligations with respect to letters of credit issued for such Person's account
or letters of credit issued pursuant to such Person's application therefor; (iv)
obligations of other Persons, whether or not assumed, secured by Liens upon
property or payable out of the proceeds or production from property now or
hereafter owned or acquired by such Person, but only to the extent of such
property's fair market value; (v) Capitalized Lease Obligations of such Person;
(vi) obligations under Interest Rate Protection Agreements and under hedge,
swap, exchange, forward, future, collar or cap arrangements, fixed price
agreements and all other agreements or arrangements designed to protect against
fluctuations in commodity prices and currency exchange rates; and (vii)
obligations of such Person pursuant to a Guaranty of any of the foregoing of
another Person. For purposes of this Agreement, the Indebtedness of any Person
shall include the Indebtedness of any partnership or joint venture to which such
Person is a party, to the extent the holder of such Indebtedness has recourse to
such Person.

         "INDEMNIFIED TAXES" shall have the meaning ascribed to such term in
SECTION 3.3.

         "INITIAL BORROWING DATE" means the date on which all conditions
precedent set forth herein to the initial Loans are satisfied or waived in
writing and the Term Loan hereunder is made.

         "INTEREST PAYMENT DATE" means (i) for a Base Rate Loan, the last
Business Day of each calendar quarter such Loan is outstanding commencing
December 31, 2003, and (ii) for a LIBOR Loan, the last Business Day of each
Interest Period for such Loan and, during any Interest Period of six (6) months,
the next Business Day occurring three (3) months after the commencement of such
Interest Period.

         "INTEREST PERIOD" means the period commencing on the date that a Loan
is advanced, continued, or created by conversion and, subject to SECTION 2.5,
ending on the date one (1), two (2), three (3) or six (6) months thereafter as
selected by the Borrower pursuant to the terms of this Agreement.

         "INTEREST RATE PROTECTION AGREEMENT" means any hedge, swap, exchange,
forward, future collar or cap arrangements, fixed price agreements or other
agreements or arrangements designed to protect against fluctuations in interest
rates.

         "INVESTMENTS" shall have the meaning ascribed to such term in SECTION
6.15.

         "L/C COMMITMENTS" means, relative to any Lender, such Lender's
obligation to participate in Letters of Credit pursuant to SECTION 2.2 in the
percentage set forth opposite its signature hereto or pursuant to SECTION 10.10,
as such commitments may be reduced from time to time pursuant to the terms of
this Agreement.

         "L/C COMMITMENT AMOUNT" means $120,000,000, as such amount may be
reduced from time to time pursuant to the terms of this Agreement.

         "L/C DOCUMENTS" means this Agreement, the Letters of Credit and
Applications with respect thereto and any draft or other document presented in
connection with a drawing thereunder.

                                       10

<PAGE>

         "L/C OBLIGATIONS" means the undrawn face amounts of all outstanding
Letters of Credit and all unpaid Reimbursement Obligations with respect to
Letters of Credit.

         "LENDERS" is defined in the Preamble.

         "LENDING OFFICE" means the branch, office or affiliate of a Lender
specified on the appropriate signature page hereof or designated pursuant to
SECTIONS 8.4 or 10.10.

         "LETTER OF CREDIT" means any of (a) the letters of credit issued by the
Agent on behalf of the Lenders for the account of the Borrower pursuant to
SECTION 2.2, and (b) the Existing L/Cs.

         "LIBOR LOAN" means any portion of the Term Loan bearing interest prior
to maturity at the Adjusted LIBOR Rate plus the Applicable Margin.

         "LIBOR RATE" means a rate of interest per annum (rounded upwards, if
necessary, to the nearest whole multiple of 1/16 of 1%), equal to the offered
rate for U.S. Dollar deposits of not less than $1,000,000 for a period of time
equal to the applicable Interest Period for such Loan as of 11:00 a.m. City of
London, England time two (2) London Business Days prior to the first date of
each such Interest Period as shown on the display designated as "British Bankers
Assoc. Interest Settlement Rates" on the Telerate System ("TELERATE"), Page 3750
or Page 3740 or such other page or pages as may replace such pages on Telerate
for the purpose of displaying such rate; provided, however, that if such rate is
not available on Telerate then such offered rate shall be otherwise
independently determined by the Agent from an alternate, substantially similar
independent source available to the Agent or shall be calculated by the Agent by
a substantially similar methodology as that theretofore used to determine such
offered rate in Telerate.

         "LIEN" means any interest in any property or asset in favor of a Person
other than the owner of the property or asset and securing an obligation owed to
such Person, whether such interest is based on the common law, statute or
contract, including, but not limited to, the security interest lien arising from
a mortgage, encumbrance, pledge, conditional sale, security agreement or trust
receipt, or a lease, consignment or bailment for security purposes.

         "LOAN" means a Base Rate Loan or a LIBOR Loan, as applicable, each of
which is a "TYPE" of Loan hereunder. A Loan is "CONTINUED" (in the case of LIBOR
Loans) on the date a new Interest Period commences for such Loan, and is
"CONVERTED" when such Loan is changed from one type of Loan to the other, all as
requested by the Borrower pursuant to SECTION 2.4(a).

         "LONDON BUSINESS DAY" means any day other than a Saturday, Sunday or a
day on which banking institutions are generally authorized or obligated by law
or executive order to close in the City of London, England.

         "MAJORITY LENDERS" means, at any time, the Lenders then holding in the
aggregate more than fifty percent (50%) of the sum of (a) the outstanding
principal owed under the Term Loan, and (b) the aggregate amount of the L/C
Commitments, or if the L/C Commitments have terminated pursuant to the terms
hereof, the aggregate Obligations. The percentage set forth opposite each
Lender's name in the line designated "Percentage" on the signature page hereto
reflects the initial voting percentage of each Lender hereunder on the Effective
Date.

                                       11

<PAGE>

         "MATERIAL ADVERSE EFFECT" means an effect that results in a material
adverse change since June 30, 2003, in (i) the business, properties, assets,
financial condition or, prior to June 30, 2003, prospects of the Borrower and
its Subsidiaries taken as a whole, or (ii) in the ability of the Borrower, or
Borrower or the Guarantors taken as a whole, to perform the Obligations under
the Credit Documents to which they are a party.

         "MATURITY DATE" means January 1, 2005.

         "MINIMUM ASSET COVERAGE RATIO" means, when determined, the ratio of (a)
Consolidated Net Assets, to (b) Net Senior Funded Debt.

         "MINIMUM INTEREST COVERAGE RATIO" means, for any period, on a trailing
four fiscal quarter basis, the ratio of (a) EBIT to (b) Consolidated Interest
Expense, less interest expense attributable to capitalized loan costs and the
amount of fees paid pursuant to SECTION 3.1 of this Agreement.

         "MOODY'S" means Moody's Investors Service, Inc., or any successor
thereto.

         "NET FUNDED DEBT" means, as of any date of determination, for the
Borrower and its Subsidiaries, Funded Debt less the amount of unrestricted cash
on hand and the fair market value of marketable securities owned by such Persons
having a value in excess of $25,000,000.

         "NET FUNDED DEBT TO EBITDA RATIO" means, when determined, the ratio of
(i) Net Funded Debt to (ii) EBITDA.

         "NET SENIOR FUNDED DEBT" means, as of any date of determination, for
the Borrower and its Subsidiaries, Net Funded Debt less the amount of
Subordinated Debt Investments.

         "NET SENIOR FUNDED DEBT TO EBITDA RATIO" means, when determined, the
ratio of (i) Net Senior Funded Debt to (ii) EBITDA.

         "NON-CASH CHARGES" means, for any period, the amount of non-cash
charges determined in accordance with GAAP; provided that (a) if any cash outlay
is made during such period in respect of such non-cash charge, only the amount
of such non-cash charge which exceeds the amount of the cash outlay may be added
back to Consolidated Net Income for purposes of calculating EBITDA and (b) the
amount of non-cash charges related to dispositions of equipment and fixed assets
shall not exceed $5,000,000.

         "NOTE PURCHASE AGREEMENT" means that certain Note Purchase Agreement
dated as of March 1, 2000, among the Borrower, as issuer, and the purchasers
listed on "Schedule A" attached thereto, as lenders, as it may be amended,
restated or supplemented from time to time.

         "NOTES" is defined in SECTION 2.11.

         "OBLIGATIONS" means all joint and several obligations of the Borrower
and the Guarantors to pay fees, costs and expenses hereunder, to pay principal
and interest on Loans and Reimbursement Obligations and to pay any other
obligations to the Agent or the Lenders arising under any Credit Document.

                                       12

<PAGE>

         "PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.

         "PERCENTAGE" means, for each Lender, the percentage of the L/C
Commitments represented by such Lender's L/C Commitment; provided that, if the
L/C Commitments are terminated, each Lender's Percentage shall be calculated
based on its L/C Commitment in effect immediately before such termination,
subject to any assignments by such Lender of Obligations pursuant to SECTION
10.10.

         "PERMITTED BUSINESS" means any business described in SECTION 6.8.

         "PERMITTED CHARGES" means, for any period, on a trailing four fiscal
quarter basis, lease termination expenses and severance costs not exceeding
$5,000,000, which relate to the organizational restructuring of the Borrower and
its Subsidiaries, plus amounts attributable to written off loan costs and any
make whole amounts.

         "PERMITTED LIENS" means the Liens described in SECTION 6.13.

         "PERSON" means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization or any other
entity or organization, including a government or any agency or political
subdivision thereof.

         "PLAN" means an employee pension benefit plan covered by Title IV of
ERISA or subject to the minimum funding standards under Section 412 of the Code
that is either (i) maintained by the Borrower or any of its Subsidiaries, or
(ii) maintained pursuant to a collective bargaining agreement or any other
arrangement under which more than one employer makes contributions and to which
the Borrower or any of its Subsidiaries is then making or accruing an obligation
to make contributions or has within the preceding five (5) plan years made or
had an obligation to make contributions.

         "REIMBURSEMENT OBLIGATION" means the obligations of the Borrower to
reimburse the Agent, for the benefit of the Lenders, for each drawing under a
Letter of Credit as described in SECTION 2.2(c).

         "S&P" means Standard & Poor's Rating Group or any successor thereto.

         "SEC" means the Securities and Exchange Commission.

         "SENIOR NOTES" means the notes, guarantees, and all other obligations
owing from time to time under or pursuant to the Note Purchase Agreement.

         "SFAS 142" means the Statement of Financial Accounting Standards No.
142 (Goodwill and Other Intangible Assets), as issued by the Financial
Accounting Standards Board in June, 2001, and applicable to all fiscal years
beginning after December 15, 2001.

         "SFAS 144" means the Statement of Financial Accounting Standards No.
144 (Accounting for the Impairment or Disposal of Long-Lived Assets), as issued
by the Financial Accounting Standards Board in August, 2001 and adopted by the
Borrower on January 1, 2002.

         "SUBORDINATED DEBT INVESTMENT" means (a) any issue of Indebtedness of
the Borrower or its Subsidiaries which is subordinated in right of payment and
collection to the Obligations on

                                       13

<PAGE>

terms acceptable to the Majority Lenders or on terms not materially less
favorable to the Lenders than either the Convertible Subordinated Notes or the
2003 Convertible Subordinated Notes, and (b) publicly issued senior subordinated
fixed rate debt securities (including any such debt securities issued under Rule
144A) that mature after the Maturity Date and are issued on then existing market
terms that are acceptable to the Agent or on terms not materially less favorable
to the Lenders than either the Convertible Subordinated Notes or the 2003
Convertible Subordinated Notes.

         "SUBORDINATED INDENTURE" means that certain Subordinated Indenture
dated as of July 25, 2000, by the Borrower, as Issuer, to Chase Bank of Texas,
National Association, as Trustee, as the same may be amended, restated or
supplemented from time to time.

         "SUBSIDIARY" means, for any Person, any corporation or other entity of
which more than fifty percent (50%) of the outstanding stock or comparable
equity interests having ordinary voting power for the election of the board of
directors of such corporation, any managers of such limited liability company or
similar governing body (irrespective of whether or not, at the time, stock or
other equity interests of any other class or classes of such corporation or
other entity shall have or might have voting power by reason of the happening of
any contingency) is at the time directly or indirectly owned by such Person, as
applicable, or by one or more of its Subsidiaries.

         "TAXES" shall have the meaning ascribed to such term in SECTION 5.12.

         "TERM LOAN" means the $60,000,000 single advance term loan described in
the recitals of this Agreement.

         "TERM NOTES" is defined in SECTION 2.11.

         "2003 CONVERTIBLE SUBORDINATED NOTES" means the notes, guarantees, and
all other obligations now or hereafter arising under, or pursuant to, the 2003
Note Purchase Agreement.

         "2003 NOTE PURCHASE AGREEMENT" means that certain Purchase Agreement
dated as of October 9, 2003, by and among the Borrower, as issuer, and the
purchasers listed on "Schedule A" attached thereto, as initial purchasers of the
Borrower's 4.50% convertible subordinated debentures due 2023, as the same may
be amended, restated or supplemented from time to time.

         "UNFUNDED VESTED LIABILITIES" means, for any Plan at any time, the
amount, if any, by which the present value of all vested nonforfeitable accrued
benefits under such Plan exceeds the fair market value of all Plan assets
allocable to such benefits, determined as of the then most recent valuation date
for such Plan, but only to the extent that such excess represents a potential
liability of the Borrower or any of its Subsidiaries to the PBGC or such Plan.

         Section 1.2. Interpretation. The foregoing definitions shall be equally
applicable to the singular and plural forms of the terms defined. All references
to times of day in this Agreement shall be references to Houston, Texas time
unless otherwise specifically provided.

                                       14

<PAGE>

SECTION 2. THE CREDIT FACILITY.

         Section 2.1. Term Loan. On the terms and subject to the conditions
hereof, each Lender severally but not jointly agrees to lend to the Borrower
that Lender's pro rata share of the Term Loan in a single advance on the date
hereof. If the Borrower pays or prepays any portion of the Term Loan under this
Agreement, such portion may not be reborrowed.

         Section 2.2. Letters of Credit.


                  (a) Issuance of Letters of Credit. On the terms and subject to
the conditions hereof, the Agent agrees to issue, from time to time prior to the
Commitment Termination Date, at the request of the Borrower and on behalf of the
Lenders and in reliance on their obligations under this SECTION 2.2, one or more
Letters of Credit for the Borrower's account; provided that the Agent shall have
no obligation to issue a Letter of Credit if, after the issuance thereof, (i)
the outstanding L/C Obligations would thereby exceed the L/C Commitment Amount
then in effect, or (ii) the issuance of such Letter of Credit would violate any
legal or regulatory restriction then applicable to the Agent or any Lender as
notified by such Lender to the Agent before the date of issuance of such Letter
of Credit. The Existing L/C Obligations are refinanced under this Agreement and,
to the extent then outstanding, shall be included in any calculation of L/C
Obligations, and such Existing L/Cs shall for all purposes constitute Letters of
Credit issued under this Agreement.

                  (b) Issuance Procedure. To request that the Agent issue a
Letter of Credit, the Borrower shall deliver to the Agent (with a duplicate copy
to an operations employee of the Agent as designated by the Agent from time to
time) a duly executed Application for the relevant Letter of Credit, or such
other computerized issuance or application procedure, instituted from time to
time by the Agent and agreed to by the Borrower, completed to the reasonable
satisfaction of the Agent, and such other documentation and information as the
Agent may reasonably request. In the event of any irreconcilable difference or
inconsistency between this Agreement and an Application, the provisions of this
Agreement shall govern. Upon receipt of a properly completed and executed
Application and any other reasonably requested documents or information at least
two (2) Business Days prior to any requested issuance date, the Agent will
process such Application in accordance with its customary procedures and issue
the requested Letter of Credit on the requested issuance date. The Borrower may
cancel any requested issuance of a Letter of Credit prior to the issuance
thereof without the incurrence of any fee, charge or expense. The Agent will
notify each Lender of the amount and expiration date of each Letter of Credit it
issues promptly upon issuance thereof. Each Letter of Credit (except for up to
$5,000,000 in aggregate face amounts of Letters of Credit) shall have an
expiration date no later than one (1) year from the date of issuance thereof,
provided that in no event shall a Letter of Credit have an expiration date later
than four (4) Business Days before the Maturity Date. If the Agent issues any
Letters of Credit with expiration dates that automatically extend unless the
Agent gives notice that the expiration date will not so extend, the Agent will
give such notice of non-renewal before the time necessary to prevent such
automatic extension if before such required notice date (i) the expiration date
of such Letter of Credit if so extended would be later than four (4) Business
Days before the Maturity Date, (ii) the Commitment Termination Date shall have
occurred, (iii) an Event of Default has occurred and is continuing, or (iv) the
Agent is so directed by the Borrower. The Agent agrees to issue amendments to
any Letter of Credit increasing its amount, or extending its expiration date, at
the request of the Borrower subject to

                                       15

<PAGE>

the conditions precedent for all Loans of SECTION 4.2 and the other terms and
conditions of this SECTION 2.2.

                  (c) The Borrower's Reimbursement Obligations.

                           (i)      The Borrower hereby irrevocably and
         unconditionally agrees to reimburse the Agent, for the benefit of the
         Lenders, for each payment or disbursement made to settle its
         obligations under any draft drawn under a Letter of Credit (each, a
         "REIMBURSEMENT OBLIGATION") within two (2) Business Days from when such
         draft is paid with funds not borrowed hereunder. The Reimbursement
         Obligation shall bear interest (which the Borrower hereby promises to
         pay) from and after the date such draft is paid until (but excluding
         the date) the Reimbursement Obligation is paid at the lesser of the
         Highest Lawful Rate or the Base Rate plus the Applicable Margin so long
         as the Reimbursement Obligation shall not be past due, and thereafter
         at the default rate per annum as set forth in SECTION 2.7(c), whether
         or not the Maturity Date shall have occurred. If any such payment or
         disbursement is reimbursed to the Agent after 2:00 p.m. on the date
         such payment or disbursement is made by the Agent, interest shall be
         paid on the reimbursable amount for one (1) day. The Agent shall give
         the Borrower notice of any drawing on a Letter of Credit within one (1)
         Business Day after such drawing is paid.

                           (ii)     The Borrower agrees for the benefit of the
         Agent and each Lender that, notwithstanding any provision of any
         Application, the obligations of the Borrower under this SECTION 2.2(c)
         and each applicable Application shall be absolute, unconditional and
         irrevocable (subject to SECTION 2.2(b)) and shall be performed strictly
         in accordance with the terms of this Agreement and each applicable
         Application under all circumstances whatsoever INCLUDING, BUT NOT
         LIMITED TO, ANY DEFENSE BASED UPON THE AGENT'S OR ANY LENDER'S OWN
         SIMPLE OR CONTRIBUTORY NEGLIGENCE (other than the defense of payment in
         accordance with this Agreement or a defense based on the gross
         negligence or willful misconduct of the Agent or any Lender),
         including, without limitation, the following circumstances (subject in
         all cases to the defense of payment in accordance with this Agreement
         or a defense based on the gross negligence or willful misconduct of the
         Agent or any Lender):

                           (1) any lack of validity or enforceability of any of
                  the L/C Documents;

                           (2) any amendment or waiver of or any consent to
                  depart from all or any of the provisions of any of the L/C
                  Documents;

                           (3) the existence of any claim, setoff, defense or
                  other right the Borrower or any Subsidiary may have at any
                  time against a beneficiary of a Letter of Credit (or any
                  Person for whom a beneficiary may be acting), the Agent, any
                  Lender or any other Person, whether in connection with this
                  Agreement, another L/C Document or any unrelated transaction;

                           (4) any statement or any other document presented
                  under a Letter of Credit proving to be forged, fraudulent,
                  invalid or insufficient in any

                                       16

<PAGE>

                  respect or any statement therein being untrue or inaccurate in
                  any respect, provided that the Agent's determination that
                  documents presented under the Letter of Credit comply with the
                  terms thereof did not constitute gross negligence or willful
                  misconduct of the Agent;

                           (5) payment by the Agent under a Letter of Credit
                  against presentation to the Agent of a draft or certificate
                  that does not comply with the terms of the Letter of Credit,
                  provided that the Agent's determination that documents
                  presented under the Letter of Credit comply with the terms
                  thereof did not constitute gross negligence or willful
                  misconduct of the Agent; or

                           (6) any other act or omission to act or delay of any
                  kind by the Agent, any Lender or any other Person or any other
                  event or circumstance whatsoever that might, but for the
                  provisions of this SECTION 2.2(c), constitute a legal or
                  equitable discharge of the Borrower's obligations hereunder or
                  under any L/C Document, provided that such act or omission of
                  the Agent did not constitute gross negligence or willful
                  misconduct of the Agent or any Lender.

                  (d) The Participating Interests. Each Lender severally and not
jointly agrees to purchase from the Agent, and the Agent hereby agrees to sell
to each Lender, an undivided percentage participating interest, to the extent of
its Percentage, in each Letter of Credit issued by, and Reimbursement Obligation
owed to, the Agent in connection with a Letter of Credit. Upon any failure by
the Borrower to pay any Reimbursement Obligation in connection with a Letter of
Credit at the time required in SECTIONS 2.2(c) and 2.4(c), or if the Agent is
required at any time to return to the Borrower or to a trustee, receiver,
liquidator, custodian or other Person any portion of any payment by the Borrower
of any Reimbursement Obligation in connection with a Letter of Credit, the Agent
shall promptly give notice of same to each Lender, and the Agent shall have the
right to require each Lender to fund its participation in such Reimbursement
Obligation. Each Lender (except the Agent to the extent it is also a Lender)
shall pay to the Agent an amount equal to each Lender's Percentage of such
unpaid or recaptured Reimbursement Obligation not later than the Business Day it
receives notice from the Agent to such effect, if such notice is received before
2:00 p.m., or not later than the following Business Day if such notice is
received after such time. If a Lender fails to pay timely such amount to the
Agent, it shall also pay to the Agent interest on such amount accrued from the
date payment of such amount was made by the Agent to the date of such payment by
the Lender at a rate per annum equal to the Federal Funds Rate in effect for
each such day, and only after such payment shall such Lender be entitled to
receive its Percentage of each payment received on the relevant Reimbursement
Obligation and of interest paid thereon. If any such Lender fails to pay such
amount to the Agent, any payments made by the Borrower with respect to the
relevant Reimbursement Obligation shall first be applied by the Agent to the
unfunded participation in such Reimbursement Obligation before any other Lenders
receive any payments or proceeds. The Agent will thereafter pay each Lender its
Percentage of each payment received by it relating to that for which such Lender
has funded its Percentage, from the date of funding. THE SEVERAL OBLIGATIONS OF
THE LENDERS TO THE AGENT UNDER THIS SECTION 2.2(D) SHALL BE ABSOLUTE,
IRREVOCABLE AND UNCONDITIONAL UNDER ANY AND ALL CIRCUMSTANCES WHATSOEVER AND
SHALL NOT BE SUBJECT TO ANY

                                       17

<PAGE>

SETOFF, COUNTERCLAIM OR DEFENSE TO PAYMENT ANY LENDER MAY HAVE OR HAVE HAD
AGAINST THE BORROWER, THE AGENT, ANY OTHER LENDER OR ANY OTHER PERSON WHATSOEVER
INCLUDING, BUT NOT LIMITED TO, ANY DEFENSE BASED ON THE FAILURE OF THE DEMAND
FOR PAYMENT UNDER THE LETTER OF CREDIT TO CONFORM TO THE TERMS OF SUCH LETTER OF
CREDIT OR THE LEGALITY, VALIDITY, REGULARITY OR ENFORCEABILITY OF SUCH LETTER OF
CREDIT AND INCLUDING, BUT NOT LIMITED TO, THOSE RESULTING FROM THE AGENT'S OWN
SIMPLE OR CONTRIBUTORY NEGLIGENCE. Without limiting the generality of the
foregoing, such obligations shall not be affected by any Default or Event of
Default or by any subsequent reduction or termination of any L/C Commitment of a
Lender, and each payment by a Lender under SECTION 2.2 shall be made without any
offset, abatement, withholding or reduction whatsoever.

         Section 2.3 Types of Loans and Minimum Borrowing Amounts. Portions of
the Term Loan may be outstanding as either Base Rate Loans or LIBOR Loans, as
selected by the Borrower pursuant to SECTION 2.4. All LIBOR Loans advanced on
the Initial Borrowing Date shall be advanced as Base Rate Loans unless a notice
for a requested LIBOR Loan has been given by 11:00 a.m. at least three (3)
Business Days before the Initial Borrowing Date and indemnification has been
provided to the Lenders in connection therewith in the event the Initial
Borrowing Date does not occur on the date requested. Each Base Rate Loan shall
be in an amount of not less than $1,000,000, or a greater integral multiple of
$500,000. Each LIBOR Loan shall be in an amount of not less than $5,000,000, or
a greater integral multiple of $1,000,000.

         Section 2.4 Manner of Borrowing.

                  (a) Selection of Interest Periods. The Borrower may select
multiple Interest Periods for LIBOR Loans, provided that at no time shall the
number of different Interest Periods for outstanding LIBOR Loans exceed eight
(8). The Borrower may from time to time elect to change or continue the type of
interest rate borne by each Loan or, subject to SECTION 2.3's minimum amount
requirement for each outstanding Loan, a portion thereof, as follows: (i) if
such Loan is a LIBOR Loan, the Borrower may continue part or all of such Loan as
a LIBOR Loan for an Interest Period specified by the Borrower or convert part or
all of such Loan into a Base Rate Loan on the last day of the Interest Period
applicable thereto, or the Borrower may earlier convert part or all of such Loan
into a Base Rate Loan so long as it pays the breakage fees and funding losses
provided in SECTION 2.12 and all interest accrued on such Loan, and (ii) if such
Loan is a Base Rate Loan, the Borrower may convert all or part of such Loan into
a LIBOR Loan for an Interest Period specified by the Borrower on any Business
Day. Notices of the continuation of a LIBOR Loan for an additional Interest
Period or of the conversion of part or all of a LIBOR Loan into a Base Rate Loan
or conversion of a Base Rate Loan into a LIBOR Loan must be given by no later
than 11:00 a.m. at least three (3) Business Days before the date of the
requested continuation or conversion. The Borrower shall give such notices
concerning the continuation or conversion of a Loan by telephone or facsimile
(which notice shall be irrevocable once given and, if by telephone, shall be
promptly confirmed in writing) which shall specify the date of the requested
continuation or conversion (which shall be a Business Day), the amount of the
applicable Loan(s), the type of Loan(s) to comprise such continued or converted
Loan(s), and, if any such Loan is to be a LIBOR Loan, the Interest Period
applicable thereto. The Borrower agrees that the Agent and each Lender may rely
on any such telephonic or facsimile

                                       18

<PAGE>

notice given by any person it in good faith believes is an authorized
representative of the Borrower without the necessity of independent
investigation and that, if any such notice by telephone conflicts with any
written confirmation, such telephonic notice shall govern if the Agent or any
Lender has acted in reliance thereon.

                  (b) Borrower's Failure to Notify. If the Borrower fails to
give notice pursuant to SECTION 2.4(A) of the continuation or conversion of any
outstanding principal amount of a LIBOR Loan and has not notified the Agent by
11:00 a.m. at least three (3) Business Days before the last day of the Interest
Period for such LIBOR Loan, the Borrower shall be deemed to have requested the
continuation of such Loan as a LIBOR Loan with an Interest Period of one (1)
month, so long as no Default or Event of Default shall have occurred and be
continuing or would occur as a result of such continuation or conversion. Upon
the occurrence and during the continuance of any Event of Default, (i) each
LIBOR Loan will automatically, on the last day of the then existing Interest
Period therefor, convert into a Base Rate Loan and (ii) the obligation of the
Lenders to continue or convert Loans into LIBOR Loans shall be suspended.

         Section 2.5 Interest Periods. As provided in SECTION 2.4(a), at the
time of each request for the continuation of, or conversion into, a LIBOR Loan,
the Borrower shall select an Interest Period applicable to such LIBOR Loan from
among the available options subject to the limitations in SECTION 2.4(a);
provided, however, that:

                  (a) the Borrower may not select an Interest Period for a LIBOR
Loan that extends beyond the Maturity Date;

                  (b) whenever the last day of any Interest Period would
otherwise be a day that is not a Business Day, the last day of such Interest
Period shall either be (i) extended to the next succeeding Business Day, or (ii)
reduced to the immediately preceding Business Day if the next succeeding
Business Day is in the next calendar month; and

                  (c) for purposes of determining an Interest Period, a month
means a period starting on one day in a calendar month and ending on the
numerically corresponding day in the next calendar month; provided, however,
that if there is no such numerically corresponding day in the month in which an
Interest Period is to end or if such Interest Period begins on the last Business
Day of a calendar month, then such Interest Period shall end on the last
Business Day of the calendar month in which such Interest Period is to end.

         Section 2.6 Interest Payments.

                  (a) Base Rate Loans. Each Base Rate Loan shall bear interest
(computed on the basis of a 365/366-day year and actual days elapsed, excluding
the date of repayment) on the unpaid principal amount thereof from the date such
Loan is made until maturity (whether by acceleration or otherwise) or conversion
to a LIBOR Loan in accordance with SECTION 2.4(a) hereof, at a rate per annum
equal to the lesser of (i) the Highest Lawful Rate or (ii) the sum of the Base
Rate from time to time in effect plus the Applicable Margin, payable in arrears
on each Interest Payment Date for such Loan and at maturity (whether by
acceleration or otherwise) or conversion to a LIBOR Loan in accordance with
SECTION 2.4(a).

                  (b) LIBOR Loans. Each LIBOR Loan shall bear interest (computed
on the basis of a 360-day year and actual days elapsed, excluding the date of
repayment) on the unpaid

                                       19

<PAGE>

principal amount thereof from the date such Loan is made until maturity (whether
by acceleration or otherwise) or conversion to a Base Rate Loan in accordance
with SECTION 2.4(a) hereof, at a rate per annum equal to the lesser of (i) the
Highest Lawful Rate or (ii) the sum of the Adjusted LIBOR Rate plus the
Applicable Margin, payable in arrears on each Interest Payment Date for such
Loan and at maturity (whether by acceleration or otherwise) or conversion to a
Base Rate Loan in accordance with SECTION 2.4(a).

                  (c) Rate Determinations. The Agent shall determine each
interest rate applicable to the Loans and Reimbursement Obligations hereunder
(including the Applicable Margin, determined as set forth in the definition
thereof) and such determination shall be conclusive and binding except in the
case of the Agent's manifest error or willful misconduct. The Agent shall give
prompt telephonic, telex or facsimile notice to the Borrower and each Lender of
the interest rate applicable to each Loan or Reimbursement Obligation (but, if
such notice is given by telephone, the Agent shall confirm such rate in writing)
promptly after the Agent has made such determination.

         Section 2.7 Default Rates. If any payment of principal on any Loan is
not made when due after the expiration of the grace period therefor provided in
SECTION 7.1 (whether by acceleration or otherwise), such Loan shall bear
interest (computed on the basis of a year of 360, 365 or 366 days, as
applicable, and actual days elapsed) from the date such payment was due until
such principal then due is paid in full, payable on demand, at a rate per annum
equal to:

                  (a) for any Base Rate Loan the lesser of (i) the Highest
Lawful Rate or (ii) the sum of two percent (2%) per annum plus the Base Rate
from time to time in effect (but not less than the Base Rate in effect at
maturity) plus the Applicable Margin;

                  (b) for any LIBOR Loan the lesser of (i) the Highest Lawful
Rate or (ii) the sum of two percent (2%) per annum plus the rate of interest in
effect thereon at the time of such default until the end of the Interest Period
for such Loan and, thereafter, at a rate per annum equal to the sum of two
percent (2%) per annum plus the Base Rate from time to time in effect (but not
less than the Base Rate in effect at maturity) plus the Applicable Margin; and

                  (c) for any unpaid Reimbursement Obligations, the lesser of
(i) the Highest Lawful Rate or (ii) the sum of two percent (2%) per annum plus
the Base Rate from time to time in effect (but not less than the Base Rate in
effect at maturity) plus the Applicable Margin.

It is the intention of the Agent and each Lender to conform strictly to usury
laws applicable to it. Accordingly, if the transactions contemplated hereby or
the Loans or the Reimbursement Obligations would be usurious as to the Agent or
the Lenders under laws applicable to it (including the laws of the United States
of America and the State of Texas or any other jurisdiction whose laws may be
mandatorily applicable to the Agent or such Lender notwithstanding the other
provisions of this Agreement, the Notes or any other Credit Document), then, in
that event, notwithstanding anything to the contrary in this Agreement, the
Notes or any other Credit Document, it is agreed as follows: (i) the aggregate
of all consideration which constitutes interest under laws applicable to the
Lenders that is contracted for, taken, reserved, charged or received by the
Lenders under this Agreement, the Notes or any other Credit Document or
otherwise shall under no circumstances exceed the Highest Lawful Rate, and any
excess shall be credited by the applicable Lender on the principal amount of the

                                       20

<PAGE>

applicable Note or to the Reimbursement Obligations (or, if the principal amount
of such Note and all Reimbursement Obligations owed to such Lender shall have
been paid in full, refunded by such Lender to the Borrower); (ii) in the event
that the maturity of the Notes is accelerated by reason of an election of the
holder or holders thereof resulting from any Event of Default hereunder or
otherwise, or in the event of any required or permitted prepayment, then such
consideration that constitutes interest under laws applicable to the Lenders may
never include more than the Highest Lawful Rate, and excess interest, if any,
provided for in this Agreement, the Notes, any other Credit Document or
otherwise shall be automatically canceled by the applicable Lenders as of the
date of such acceleration or prepayment and, if theretofore paid, shall be
credited by the applicable Lenders on the principal amount of the applicable
Notes or Reimbursement Obligations (or if the principal amounts thereof shall
have been paid in full, refunded by the applicable Lender to the Borrower); and
(iii) if at any time the interest provided hereunder, together with any other
fees payable pursuant to this Agreement, the Notes or any other Credit Document
and deemed interest under applicable law, exceeds the amount that would have
accrued at the Highest Lawful Rate, the amount of interest and any such fees to
accrue to the Lenders hereunder and thereunder shall be limited to the amount
which would have accrued at the Highest Lawful Rate, but any subsequent
reductions shall not reduce the interest to accrue to the Lenders hereunder and
thereunder below the Highest Lawful Rate until the total amount of interest
accrued pursuant hereto and thereto and such fees deemed to be interest equals
the amount of interest which would have accrued to the Lenders if a varying rate
per annum equal to the interest hereunder had at all times been in effect plus
the amount of fees which would have been received but for the effect of this
SECTION 2.7. The Agent and the Lenders hereby elect to determine the applicable
rate ceiling under Section 303.201 of the Texas Finance Code Ann. (Vernon 1998)
by the weekly rate ceiling from time to time in effect, subject to the Agent's
and the Lenders' right subsequently to change such method in accordance with
applicable law. In the event the Loans and all Reimbursement Obligations are
paid in full by the Borrower prior to the Maturity Date and the interest
received for the actual period of the existence of the Loans or the
Reimbursement Obligations exceeds the Highest Lawful Rate, the applicable
Lenders shall refund to the Borrower the amount of the excess or shall credit
the amount of the excess against amounts owing under the Loans and none of the
Lenders shall be subject to any of the penalties provided by law for contracting
for, taking, reserving, charging or receiving interest in excess of the Highest
Lawful Rate. The provisions of Chapter 346 of Tex. Finance Code Ann. (Vernon
1998), regulating certain revolving credit accounts shall not apply to this
Agreement or any of the Notes.

         Section 2.8 Maturity of Loans. Each Loan, together with accrued and
unpaid interest thereon and all other fees then due and owing under any Credit
Document, shall mature and become due and payable on the Maturity Date.

         Section 2.9 Optional Prepayments. The Borrower shall have the privilege
of prepaying the Term Loan without premium or penalty in whole or in part at any
time, provided that, each voluntary partial prepayment of the Term Loan must be
in a principal amount of not less than $5,000,000, or a greater integral
multiple of $1,000,000. If the Borrower is prepaying LIBOR Loans, it shall give
the Agent notice of such prepayment no later than 11:00 a.m. at least two (2)
Business Days before the proposed prepayment date. All prepayments of Loans
shall be accompanied by accrued interest thereon, together with, if such Loans
being prepaid are LIBOR Loans, any applicable breakage fees and funding losses
pursuant to SECTION 2.12. The Borrower

                                       21

<PAGE>

may direct the application of any optional prepayment hereunder to the Base Rate
Loans or LIBOR Loans outstanding.

         Section 2.10 Mandatory Prepayments of Loans.

                  (a) If the aggregate amount of outstanding L/C Obligations
shall at any time for any reason exceed the L/C Commitment Amount then in
effect, the Borrower shall, immediately and without notice or demand, pay the
amount of such excess to the Agent for the ratable benefit of the Lenders as a
pre-funding of cash collateral for Letters of Credit to the extent such Letters
of Credit are not fully cash collateralized at the time of such pre-funding.

                  (b) Any mandatory prepayment of Loans pursuant to this
Agreement shall not be limited by the notice provision for prepayments set forth
in SECTION 2.9, but immediately upon determining the need to make any such
prepayment, the Borrower shall notify the Agent of such required prepayment.
Each such prepayment shall be accompanied by a payment of all accrued and unpaid
interest on the Loans prepaid and any applicable breakage fees and funding
losses pursuant to SECTION 2.12.

                  (c) Proceeds of the initial Loan shall be used in accordance
with SECTION 2.10(c) of the Existing Credit Agreement.

         Section 2.11 The Notes. The Term Loans outstanding to the Borrower from
the Lenders shall be evidenced by promissory notes of the Borrower payable to
each of the Lenders and the Agent in the form of EXHIBIT 2.11 (each such
promissory note, together with any replacements thereof, a "TERM NOTE", and
collectively, the "NOTES"). Each holder of a Note shall record on its books and
records or on a schedule to the Note the amount of each Loan outstanding from it
to the Borrower, all payments of principal and interest and the principal
balance from time to time outstanding thereon, the type of such Loan and, if a
LIBOR Loan, the Interest Period and interest rate applicable thereto. Such
record, whether shown on the books and records of a holder of a Note or on a
schedule to its Note, shall be prima facie evidence as to all such matters;
provided, however, that the failure of any holder to record any of the foregoing
or any error in any such record shall not limit or otherwise affect the
obligation of the Borrower to repay all Loans outstanding to it hereunder,
together with accrued interest thereon. At the request of any holder of a Note
and upon such holder tendering to the Borrower the Note to be replaced, the
Borrower shall furnish a new Note to such holder to replace any outstanding Note
and at such time the first notation appearing on the schedule on the reverse
side of, or attached to, such new Note shall set forth the aggregate unpaid
principal amount of all Loans, if any, then outstanding thereon.

         Section 2.12 Breakage Fees. If any Lender incurs any loss, cost or
expense (excluding any loss of anticipated profit, but including, without
limitation, any loss, cost, expense or premium reasonably incurred by reason of
the liquidation or re-employment of deposits or other funds acquired by such
Lender to fund or maintain any LIBOR Loan or the relending or reinvesting of
such deposits or amounts paid or prepaid to the Lenders) as a result of any of
the following events other than any such occurrence as a result of a change of
circumstance described in SECTIONS 8.1 or 8.2:

                                       22

<PAGE>

                           (i)      any payment, prepayment or conversion of a
         LIBOR Loan on a date other than the last day of its Interest Period
         (whether by acceleration, prepayment or otherwise);

                           (ii)     any failure to make a principal payment of a
         LIBOR Loan on the due date therefor; or

                           (iii)    any failure by the Borrower to continue,
         prepay or convert to a LIBOR Loan on the date specified in a notice
         given pursuant to SECTION 2.4(a) (other than by reason of a default of
         a Lender),

then the Borrower shall pay to such Lender such amount as will reimburse such
Lender for such loss, cost or expense. If any Lender makes such a claim for
compensation, it shall provide to the Borrower a certificate executed by an
officer of such Lender setting forth the amount of such loss, cost or expense in
reasonable detail (including an explanation of the basis for and the computation
of such loss, cost or expense) no later than 120 days after the event giving
rise to the claim for compensation, and the amounts shown on such certificate
shall be conclusive and binding absent manifest error. Within ten (10) days of
receipt of such certificate, the Borrower shall pay to such Lender such amount
as will compensate such Lender for such loss, cost or expense as provided
herein, unless such Lender has failed to timely give notice to the Borrower of
such claim for compensation as provided herein, in which event the Borrower
shall no longer be obligated to pay such claim.

         Section 2.13 L/C Commitment Terminations. The Borrower shall have the
right at any time and from time to time, upon five (5) Business Days' prior and
irrevocable written notice to the Agent, to terminate or reduce the L/C
Commitments without premium or penalty, in whole or in part, any partial
termination to be (i) in an amount not less than $1,000,000 as determined by the
Borrower, and (ii) allocated ratably among the Lenders in proportion to their
respective L/C Commitments, as applicable; provided that the L/C Commitment
Amount may not be reduced to an amount less than the sum of the aggregate amount
of outstanding L/C Obligations, after giving effect to payments on such proposed
termination or reduction date, unless the Borrower provides to the Lenders or
the Agent, as applicable, cash collateral in an amount sufficient to cover such
shortage or back-to-back letters of credit from a financial institution
satisfactory to all of the Lenders in an amount equal to the undrawn face amount
of any applicable outstanding Letters of Credit with an expiry date of at least
five (5) days after the expiry date of any applicable Letter of Credit and which
provide that the Lenders may make a drawing thereunder in the event that it pays
a drawing under such Letter of Credit. Any termination of the L/C Commitments
pursuant to this SECTION 2.13 is permanent and may not be reinstated. The Agent
shall give prompt notice to each Lender of any such termination of the L/C
Commitments.

         Section 2.14 Agent Reliance on Borrower Payment. Except as otherwise
provided under SECTION 2.2(c), unless the Borrower has notified the Agent prior
to the date any payment or prepayment to be made by it is due (or if the
Borrower has given notice of its intention to prepay a Loan on such date), that
it does not intend to make such payment or prepayment, the Agent may assume that
the Borrower has made such payment when due (or on the date stated in its
prepayment notice) and in reliance upon such assumption may (but shall not be
required to) make available to each Lender its Percentage of such payment. If
such payment was not in fact made to the Agent in immediately available funds,
then each Lender shall promptly on demand

                                       23

<PAGE>

repay to the Agent the amount of such assumed payment made available to such
Lender, together with interest thereon in respect of each day from and including
the date such amount was made available by the Agent to such Lender to the date
such amount is repaid to the Agent at the Federal Funds Rate.

SECTION 3. FEES AND PAYMENTS.

         Section 3.1 Fees.

                  (a) Letter of Credit Fees. Commencing upon the Effective Date,
the Borrower shall pay to the Agent quarterly in arrears (pro rated, if
necessary for any portion of such quarter) for the ratable account of the
Lenders (based on their respective Percentages) a non-refundable fee for any
Letter of Credit equal to the greater of (x) $125 per quarter, or (y) the face
amount of such Letter of Credit multiplied by a rate equal to 0.50% per annum,
calculated on the basis of a 365/366-day year and actual days in the period and
based on the then scheduled expiry date of the Letter of Credit. Thereafter,
such fees shall be payable by the Borrower in arrears on the last Business Day
of each calendar quarter of each year commencing with the next succeeding
calendar quarter, with the last such payment on the date any such Letter of
Credit expires. In addition, the Borrower shall pay to the Agent solely for the
Agent's account, in connection with each Letter of Credit, reasonable
administrative and amendment fees and expenses for letters of credit established
by the Agent from time to time in accordance with its customary practices and as
agreed between the Agent and the Borrower and a fronting fee of 1/8% of the face
amount of each Letter of Credit (other than the Existing L/Cs). All fees paid to
the Agent or any other parties before the date of this Agreement in respect of
any Existing L/Cs are solely for the account of those parties without any
accounting for them or sharing of them with the Agent or Lenders notwithstanding
any contrary provision in this Agreement.

                  (b) Agent Fees. The Borrower shall pay to the Agent the fees
agreed to from time to time by the Borrower and the Agent.

         Section 3.2 Place and Application of Payments. All payments of
principal of and interest on the Loans and the Reimbursement Obligations and all
other amounts payable by the Borrower under the Credit Documents shall be made
by the Borrower to the Agent by no later than 2:00 p.m. on the due date thereof
at the office of the Agent in Houston, Texas (or such other location as the
Agent may designate to the Borrower). Any payments received by the Agent from
the Borrower after 2:00 p.m. shall be deemed to have been received on the next
Business Day.

         Section 3.3 Withholding Taxes.

                  (a) Payments Free of Withholding. Except as otherwise required
by law and subject to SECTION 3.3(b), each payment by the Borrower to the Agent
or any Lender under this Agreement or any other Credit Document shall be made
without withholding for or on account of any present or future taxes (other than
overall net income taxes on the recipient) imposed by or within the jurisdiction
in which the Borrower is domiciled, any jurisdiction from which the Borrower
makes any payment, or (in each case) any political subdivision or taxing
authority thereof or therein, excluding, in the case of each Lender and the
Agent, taxes, assessments or other governmental charges

                                       24

<PAGE>

                           (i)      imposed on, based upon, or measured by its
         income, and branch profits, franchise and similar taxes imposed on it,
         by any jurisdiction in which the Agent or such Lender, as the case may
         be, is incorporated or maintains its principal place of business or
         Lending Office or which subjects the Agent or such Lender to tax by
         reason of a connection between the taxing jurisdiction and the Agent or
         such Lender (other than a connection resulting from the transactions
         contemplated by this Agreement);

                           (ii)     imposed as a result of a connection between
         the taxing jurisdiction and the Agent or such Lender, as the case may
         be, other than a connection resulting from the transactions
         contemplated by this Agreement;

                           (iii)    imposed as a result of the transfer by such
         Lender of its interest in this Agreement or any other Credit Document
         or a designation by such Lender (other than pursuant to SECTION 3.3(d)
         hereof) of a new Lending Office (other than taxes imposed as a result
         of any change in treaty, law or regulation after such transfer of the
         Lender's interest in this Agreement or any Credit Document or
         designation of a new Lending Office);

                           (iv)     imposed by the United States of America upon
         a Lender organized under the laws of a jurisdiction outside of the
         United States, except to the extent that such tax is imposed or
         increased as a result of any change in applicable law, regulation or
         treaty (other than any addition of or change in any "anti-treaty
         shopping," "limitation of benefits," or similar provision applicable to
         a treaty) after the Effective Date, in the case of each Lender
         originally a party hereto or, in the case of any Purchasing Lender (as
         defined in SECTION 10.10), after the date on which it becomes a Lender;

                           (v)      which would not have been imposed but for
          (a) the failure of the Agent or any Lender, as the case may be, to
         provide (x) an Internal Revenue Service Form 1001 or 4224, as the case
         may be, or any substitute or successor form prescribed by the Internal
         Revenue Service pursuant to SECTION 3.3(b) below, or (y) any other
         certification, documentation or proof which is reasonably requested by
         the Borrower, or (b) a determination by a taxing authority or a court
         of competent jurisdiction that a certification, documentation or other
         proof provided by such Lender or the Agent to establish an exemption
         from such tax, assessment or other governmental charge is false

(all such non-excluded taxes, assessments or other governmental charges and
liabilities being hereinafter referred to as "INDEMNIFIED TAXES"). If any such
withholding is so required, the Borrower shall make the withholding, pay the
amount withheld to the appropriate governmental authority before penalties
attach thereto or interest accrues thereon and forthwith pay such additional
amount as may be necessary to ensure that the net amount actually received by
the Agent and each Lender is free and clear of such Indemnified Taxes (including
Indemnified Taxes on such additional amount) and is equal to the amount that the
Agent or such Lender (as the case may be) would have received had such
withholding not been made. If the Agent or any Lender pays any amount in respect
of any Indemnified Taxes, penalties or interest, the Borrower shall reimburse
the Agent or that Lender for the payment on demand in the currency in which such
payment was made. If the Borrower pays any Indemnified Taxes, penalties or
interest, it shall deliver official tax receipts evidencing the payment or
certified copies thereof, or other satisfactory evidence of payment if such tax
receipts have not yet been received by the Borrower

                                       25

<PAGE>
(with such tax receipts to be promptly delivered when actually received), to the
Agent or the Lender on whose account such withholding was made (with a copy to
the Agent if not the recipient of the original) within fifteen (15) days of such
payment.

                  (b) U.S. Withholding Tax Exemptions. Each Lender that is not a
United States person (as such term is defined in Section 7701(a)(30) of the
Code) shall submit to the Borrower and the Agent on or before the Effective
Date, two duly completed and signed copies of either Form 1001 (entitling such
Lender to a complete exemption from withholding under the Code on all amounts to
be received by such Lender, including fees, pursuant to the Credit Documents) or
Form 4224 (relating to all amounts to be received by such Lender, including
fees, pursuant to the Credit Documents) of the Internal Revenue Service.
Thereafter and from time to time, each Lender shall submit to the Borrower and
the Agent such additional duly completed and signed copies of one or the other
of such forms (or such successor forms as shall be adopted from time to time by
the relevant United States taxing authorities) as may be (i) notified by the
Borrower, directly or through the Agent, to such Lender, and (ii) required under
then-current United States law or regulations to avoid United States withholding
taxes on payments in respect of all amounts to be received by such Lender,
including fees, pursuant to the Credit Documents. Upon the request of the
Borrower, each Lender that is a United States person shall submit to the
Borrower a certificate to the effect that it is such a United States person.
Each such Lender shall make written demand on the Borrower for indemnification
or compensation hereunder not later than 120 days after the earlier of (i) the
date on which such Lender or Agent makes payment of Indemnified Taxes, or (ii)
the date on which the relevant taxing authority or other governmental authority
makes written demand upon such Lender or the Agent for payment of Indemnified
Taxes; provided that any failure of a Lender or the Agent to give the Borrower
timely notice as provided herein shall not relieve the Borrower of any
obligation which it has to pay such claim for compensation for such
indemnification.

                  (c) Inability of Lender to Submit Forms. If any Lender
determines, as a result of any change in applicable law, regulation or treaty,
or in any official application or interpretation thereof, that it is unable to
submit to the Borrower or the Agent any form or certificate that such Lender is
obligated to submit pursuant to SECTION 3.3(b) or that such Lender is required
to withdraw or cancel any such form or certificate previously submitted or any
such form or certificate otherwise becomes ineffective or inaccurate, such
Lender shall promptly notify the Borrower and the Agent of such fact and the
Lender shall to that extent not be obligated to provide any such form or
certificate and will be entitled to withdraw or cancel any affected form or
certificate, as applicable.

                  (d) Refund of Taxes. If any Lender or the Agent receives a
refund of any Indemnified Tax or any tax referred to in SECTION 10.3 with
respect to which the Borrower has paid any amount pursuant to this SECTION 3.3
or SECTION 10.3, such Lender or the Agent shall pay the amount of such refund
(including any interest received with respect thereto) to the Borrower.

SECTION 4. CONDITIONS PRECEDENT.

         Section 4.1 Conditions Precedent to Initial Borrowing. The obligation
of each Lender to advance its portion of the Term Loan and of the Agent to issue
any Letter of Credit on the Initial Borrowing Date is subject to the following
conditions precedent, all in form and substance satisfactory to the Lenders (and
which shall be evidenced by the making of such Loan(s) and, if

                                       26

<PAGE>

applicable, the issuance of such Letter(s) of Credit) and in sufficient number
of signed counterparts, where applicable, to provide one for each Lender (except
for the Term Notes, of which only one original shall be signed for each Lender):

                  (a) The Agent shall have received:

                           (i)      Notes. The duly executed Notes of the
         Borrower;

                           (ii)     Issuance of 2003 Convertible Subordinated
         Notes and Execution of Cash Collateral Security Agreement. Evidence
         that the Borrower has issued at least $270,000,000 principal amount of
         2003 Convertible Subordinated Notes and the net cash proceeds from the
         issuance of such Indebtedness shall have been applied in accordance
         with Section 2.10(c) of the Existing Credit Agreement, and the Cash
         Collateral Security Agreement shall have been executed and all
         Collateral required to be delivered pursuant to the terms thereof shall
         have been delivered;

                           (iii)    Termination and Release Agreement. A
         Termination and Release Agreement with respect to the Existing Credit
         Agreement, in form and substance reasonably satisfactory to the Agent,
         duly executed by the Borrower;

                           (iv)     Ratifications. Duly executed ratifications
         of the Existing Subsidiary Guaranties, the Existing Pledge Agreements
         and the Existing Security Agreements in form and substance reasonably
         satisfactory to the Agent;

                           (v)      Debt Rating. Evidence reasonably
         satisfactory to the Agent that the Borrower's senior unsecured
         unenhanced debt is rated (A) B1 or higher with a stable outlook by
         Moody's, and (B) B+ or higher with a stable outlook by S&P;

                           (vi)     Certificate of Officers of Borrower and
         Guarantors. A certificate of the Secretary or Assistant Secretary and
         the President or Vice President of each of the Borrower and the
         Guarantors containing specimen signatures of the persons authorized to
         execute Credit Documents on such Person's behalf or any other documents
         provided for herein, together with (x) copies of resolutions of the
         Board of Directors of such Person authorizing the execution and
         delivery of the Credit Documents and of all other legal documents or
         proceedings taken by such Person in connection with the execution and
         delivery of the Credit Documents, and (y) copies of such Person's
         Certificate or Articles of Incorporation, certified by the Secretary of
         State of such Person's jurisdiction of organization, and Bylaws;

                           (vii)    Certificates of Existence and Good Standing.
         Certificates of existence and good standing from the appropriate
         governing agency of the Borrower's and each Guarantor's jurisdiction of
         organization and of all jurisdictions where the Borrower is authorized
         to do business;

                           (viii)   Fees. Payment of all fees and all expenses
         incurred through the Effective Date then due and owing to the Agent
         pursuant to this Agreement or any other written agreement between the
         Borrower and Bank of America, N.A. (or any of its Affiliates) in effect
         on the date of this Agreement;

                                       27

<PAGE>

                           (ix)     Consents. Certified copies of all documents
         evidencing any necessary consents and governmental approvals taken or
         obtained by the Borrower and the Guarantors with respect to the Credit
         Documents;

                           (x)      Financial Condition Certificate. A
         certificate of the principal financial officer of the Borrower in
         substantially the form of EXHIBIT 4.1;

                           (xi)     Financial Statements. Consolidated financial
         statements of the Borrower and its Subsidiaries for the fiscal year
         ending December 31, 2002, and the fiscal quarter ending June 30, 2003
         (in each case including balance sheets and statements of income,
         retained earnings, and cash flows, with the December 31, 2002 financial
         statements being audited by independent public accountants of
         recognized national standing and prepared in accordance with GAAP),
         which financial statements are acceptable to Agent;

                           (xii)    Opinions of Counsel. The opinions of (1)
         Dana Gordon, General Counsel to the Borrower and the Guarantors, and
         (2) Weil, Gotshal & Manges, LLP, in each case covering such matters as
         the Lenders may reasonably require; and

                           (xiii)   Other Documents. Such other documents as the
         Lenders may reasonably request.

                  (b) All legal matters incident to the execution and delivery
of the Credit Documents shall be reasonably satisfactory to the Lenders.

         Section 4.2 Conditions Precedent to all Loans. In the case of each
issuance of, increase in the amount of, or extension of the expiry date of, a
Letter of Credit:

                  (a) Notices. The Agent shall have received a duly completed
Application for such Letter of Credit meeting the requirements of SECTION 2.2;

                  (b) Representations and Warranties True and Correct. Each of
the representations and warranties of the Borrower and its Subsidiaries set
forth herein and in the Credit Documents shall be true and correct in all
material respects as of the time of such issuance, increase or extension, except
as a result of the transactions expressly permitted hereunder or thereunder and
except to the extent that any such representation or warranty relates solely to
an earlier date, in which case it shall have been true and correct in all
material respects as of such earlier date;

                  (c) No Default. No Default or Event of Default shall have
occurred and be continuing or would occur as a result of such issuance, increase
or extension;

                  (d) New Litigation and Changes in Pending Litigation. Since
the Effective Date, no new litigation (including, without limitation, derivative
or injunctive actions), arbitration proceedings or governmental proceedings
shall be pending or known by the Borrower to be threatened against the Borrower
or any of its Subsidiaries which could reasonably be expected to have a Material
Adverse Effect; and no material development (whether or not disclosed) shall
have occurred in any litigation (including, without limitation, derivative or
injunctive actions), arbitration proceedings or governmental proceedings
previously disclosed, which could reasonably be expected to have a Material
Adverse Effect;

                                       28

<PAGE>

                  (e) Regulation U; Other Laws. The issuance, increase or
extension shall not result in either the Borrower or the Agent or any Lender
being in non-compliance with or in violation of Regulation U of the Board of
Governors of the Federal Reserve System and shall not be prohibited by any other
legal requirement (including Regulations T and X of the Board of Governors of
the Federal Reserve System) imposed by the banking laws of the United States of
America, and shall not otherwise subject the Agent or any Lender to a penalty or
other onerous conditions under or pursuant to any legal requirement;

                  (f) No Material Adverse Change. There shall have occurred no
event or effect that has had or could reasonably be expected to have a Material
Adverse Effect; and

                  (g) Cash Collateral. With respect to the issuance of a
requested Letter of Credit, the Borrower shall provide the Agent with cash
collateral in an amount equal to the face amount of such Letter of Credit.

Each request for the issuance of, increase in the amount of, or extension of the
expiry date of, a Letter of Credit shall be deemed to be a representation and
warranty by the Borrower on the date of such issuance of, increase in the amount
of, or extension of the expiry date of, such Letter of Credit that all
conditions precedent to such issuance, increase or extension have been satisfied
or fulfilled unless the Borrower gives the Agent written notice to the contrary,
in which case the Agent shall not be required to issue, increase the amount of
or extend the expiry date of such Letter of Credit unless the Majority Lenders
shall have previously waived in writing such non-compliance. In the event an
Event of Default shall have occurred and be continuing, the Borrower may not
convert any Base Rate Loan into a LIBOR Loan or continue any LIBOR Loan and may
only convert or continue any LIBOR Loan into or as a Base Rate Loan in
accordance with SECTION 2.4(a) hereof and subject to the applicability of the
provisions of SECTION 2.7 regarding default rates of interest, and in such case,
any LIBOR Loan which has not been accelerated pursuant to the terms hereof shall
automatically convert into a Base Rate Loan at the end of the applicable
Interest Period unless prior to such time, any such Event of Default shall have
been cured or waived pursuant to the terms hereof. In the event a Default shall
have occurred and be continuing, the Borrower may only convert any Base Rate
Loan or continue any LIBOR Loan into a LIBOR Loan with a one (1) month Interest
Period.

SECTION 5. REPRESENTATIONS AND WARRANTIES.

         The Borrower represents and warrants to the Agent and each Lender as
follows:

         Section 5.1 Organization.

                  (a) The Borrower and each of its Subsidiaries (i) is a duly
incorporated (or organized) and existing corporation (or other Person) in good
standing under the laws of the jurisdiction of its organization, (ii) has all
necessary corporate power (or comparable power, in the case of a Subsidiary that
is not a corporation) to own the property and assets it uses in its business and
otherwise to carry on its business as presently conducted, and (iii) is duly
licensed or qualified and in good standing in each jurisdiction in which the
nature of the business transacted by it or the nature of the property owned or
leased by it makes such licensing or qualification necessary, except where the
failure to be so licensed or qualified could not reasonably be expected to have
a Material Adverse Effect.

                                       29

<PAGE>

                  (b) As of the date hereof, the Borrower has no Subsidiaries
other than the Subsidiaries listed on SCHEDULE 5.1, and the Borrower directly or
indirectly owns one hundred percent (100%) of each class of capital stock or
ownership interests of each such Subsidiary.

         Section 5.2 Power and Authority; Validity. Each of the Borrower and the
Guarantors has the corporate (or comparable power, in the case of a Subsidiary
that is not a corporation) power and authority to execute, deliver and carry out
the terms and provisions of the Credit Documents to which it is a party and has
taken all necessary corporate (or comparable action, in the case of a Subsidiary
that is not a corporation) action to authorize the execution, delivery and
performance of the Credit Documents to which it is a party. Each of the Borrower
and the Guarantors has duly executed and delivered each such Credit Document and
each such Credit Document constitutes the legal, valid and binding obligation of
such Person enforceable in accordance with its terms, subject as to enforcement
only to bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity, regardless of whether in a proceeding in equity or at law.

         Section 5.3 No Violation. Neither the execution, delivery nor
performance by the Borrower or any of the Guarantors of the Credit Documents to
which it is a party nor compliance by any of such Persons with the terms and
provisions thereof, nor the consummation by it of the transactions contemplated
herein or therein, will (i) contravene any applicable provision of any law,
statute, rule or regulation, or any applicable order, writ, injunction or decree
of any court or governmental instrumentality, except where such contravention
could not reasonably be expected to have a Material Adverse Effect, (ii)
conflict with or result in any breach of any term, covenant, condition or other
provision of, or constitute a default under (except where such conflict, breach
or default could not reasonably be expected to have a Material Adverse Effect),
or result in the creation or imposition of (or the obligation to create or
impose) any Lien other than any Permitted Lien upon any of the property or
assets of the Borrower or its Subsidiaries under the terms of any contractual
obligation to which the Borrower or any of its Subsidiaries is a party or by
which it or any of its properties or assets are bound or to which it may be
subject, or (iii) violate or conflict with any provision of the Certificate or
Articles of Incorporation or Bylaws or other governance documents, as
applicable, of such Person.

         Section 5.4 Litigation. There are no lawsuits (including, without
limitation, derivative or injunctive actions), arbitration proceedings or
governmental proceedings pending or, to the best knowledge of the Borrower,
threatened, involving the Borrower or any of its Subsidiaries except for such
lawsuits or other proceedings which could not reasonably be expected to have a
Material Adverse Effect and any lawsuits and proceedings disclosed in SCHEDULE
5.4.

         Section 5.5 Use of Proceeds; Margin Regulations. The proceeds of the
Loans may only be used to repay existing Indebtedness, to provide working
capital and for general corporate purposes (including the issuance of Letters of
Credit). Neither the Borrower nor any of its Subsidiaries are engaged in the
business of extending credit for the purpose of purchasing or carrying margin
stock. No proceeds of any Loan will be used to purchase or carry any "margin
stock" (as defined in Regulation U of the Board of Governors of the Federal
Reserve System), to extend credit for the purpose of purchasing or carrying any
"margin stock," or for a purpose which violates Regulations T, U or X of the
Board of Governors of the Federal Reserve System.

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<PAGE>

         Section 5.6 Investment Company Act. Neither the Borrower nor any of its
Subsidiaries is an "investment company" or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940,
as amended.

         Section 5.7 Public Utility Holding Company Act. Neither the Borrower
nor any of its Subsidiaries is a "holding company," or a "subsidiary company" of
a "holding company," or an "affiliate" of a "holding company" or of a
"subsidiary company" of a "holding company," within the meaning of the Public
Utility Holding Company Act of 1935, as amended.

         Section 5.8 True and Complete Disclosure. All factual information (not
including estimated, pro forma financial information and other projections)
heretofore or contemporaneously furnished by the Borrower or any of its
Subsidiaries in writing to the Agent or the Lenders in connection with any
Credit Document or any transaction contemplated therein is, disregarding any
updated, corrected, supplemented, superseded or otherwise modified information
except as so updated, corrected, supplemented, superseded or otherwise modified
and all other such factual information hereafter furnished by any such Persons
in writing to the Lenders in connection herewith, any of the other Credit
Documents or the Loans will be, true and accurate in all material respects,
taken as a whole, on the date of such information and not incomplete by omitting
to state any material fact necessary to make the information therein not
misleading at such time in light of the circumstances under which such
information, taken as a whole, was provided. All estimates, pro forma financial
information and projections furnished by the Borrower or any of its Subsidiaries
in writing to the Lenders in connection with any Credit Document or any
transaction contemplated therein, were prepared by the Borrower in good faith
based upon assumptions believed by the Borrower to be reasonable at the time
such information was prepared, it being recognized by the Agent and the Lenders
that such financial information as it relates to future events is not to be
viewed as fact and that actual results during the period or periods covered by
such financial information may differ from the projected results set forth
therein by a material amount.

         Section 5.9 Financial Statements. The financial statements heretofore
delivered to the Lenders for the fiscal year ending December 31, 2002 and the
fiscal quarter ending June 30, 2003, were prepared in accordance with GAAP, and
such financial statements, together with the related notes and schedules, fairly
presents the financial position of the Borrower and its Subsidiaries as of the
dates thereof and the results of operations for the periods covered thereby,
subject to normal year-end adjustments and omission of certain footnotes as
permitted by the SEC.

         Section 5.10 No Material Adverse Change. From June 30, 2003, there has
occurred no event or effect that has had, or to the best knowledge of the
Borrower could reasonably be expected to have, a Material Adverse Effect.

         Section 5.11 Labor Controversies. There are no labor strikes,
lock-outs, slow downs, work stoppages or similar events pending or, to the best
knowledge of the Borrower, threatened against the Borrower or any of its
Subsidiaries that could reasonably be expected to have a Material Adverse
Effect.

         Section 5.12 Taxes. Except as disclosed on SCHEDULE 5.12, the Borrower
and its Subsidiaries have filed all federal tax returns and all other material
tax returns required to be

                                       31


<PAGE>

filed, and have paid all governmental taxes, rates, assessments, fees, charges
and levies (collectively, "TAXES") except such Taxes, if any, as are being
contested in good faith and for which reserves have been provided in accordance
with GAAP and except where the failure to pay such Taxes could not reasonably be
expected to have a Material Adverse Effect. Except as disclosed on SCHEDULE
5.12, no tax liens have been filed and no claims are being asserted for Taxes.
Except as disclosed on SCHEDULE 5.12, the charges, accruals and reserves on the
books of the Borrower and its Subsidiaries for Taxes and other governmental
charges have been determined in accordance with GAAP.

         Section 5.13 ERISA. With respect to each Plan, the Borrower and its
Subsidiaries have fulfilled their obligations under the minimum funding
standards of, and are in compliance in all material respects with, ERISA and
with the Code to the extent applicable to it, and have not incurred any
liability under Title IV of ERISA to the PBGC or a Plan other than a liability
to the PBGC for premiums under Section 4007 of ERISA, except where such
liability could not reasonably be expected to have a Material Adverse Effect. As
of the Effective Date, neither the Borrower nor any of its Subsidiaries has any
contingent liability with respect to any post-retirement benefits under a
welfare plan as defined in ERISA other than liability for continuation coverage
described in Part 6 of Title I of ERISA, except where such liability could not
reasonably be expected to have a Material Adverse Effect.

         Section 5.14 Consents. All consents and approvals of, and filings and
registrations with, and all other actions of, all governmental agencies,
authorities or instrumentalities required to consummate the transactions
hereunder have been obtained or made and are or will be in full force and
effect.

         Section 5.15 Capitalization. All outstanding capital stock of the
Borrower and its Subsidiaries has been duly and validly issued, is fully paid
and nonassessable. None of the Borrower's Subsidiaries has outstanding any
securities convertible into or exchangeable for its capital stock or outstanding
any rights to subscribe for or to purchase, or any options for the purchase of,
or any agreement providing for the issuance (contingent or otherwise) of, or any
calls, commitments or claims of any character relating to, its capital stock.

         Section 5.16 Ownership of Property. The Borrower and its Subsidiaries
have good title to or a valid leasehold interest in all of its property except
to the extent, in the aggregate, no Material Adverse Effect could reasonably be
expected to result from the failure to have such title or interest, subject to
no Liens except Permitted Liens. The Borrower and its Subsidiaries own or hold
valid licenses to use all the material patents, trademarks, permits, service
marks and trade names, free of any burdensome restrictions, that are necessary
to the operation of the business of the Borrower and its Subsidiaries as
presently conducted, except where the failure to own or hold such licenses could
not reasonably be expected to have a Material Adverse Effect.

         Section 5.17 Compliance with Statutes. The Borrower and its
Subsidiaries are in compliance in all material respects with all applicable
statutes, regulations and orders of, and all applicable restrictions imposed by,
all governmental bodies and have all necessary permits, licenses and other
necessary authorizations with respect to the conduct of their businesses and the
ownership and operation of their properties except where the failure to so
comply or hold such permits, licenses or other authorizations could not
reasonably be expected to have a Material Adverse Effect.

                                       32

<PAGE>

         Section 5.18 Environmental Matters.

                  (a) Borrower and its Subsidiaries have complied with, and on
the date any Letter of Credit is issued, increased or extended will be in
compliance with, all applicable Environmental Laws and the requirements of any
permits issued under such Environmental Laws except where failure to so comply
could not reasonably be expected to have a Material Adverse Effect. To the best
knowledge of the Borrower, there are no pending, past or threatened
Environmental Claims against the Borrower or any of its Subsidiaries or any
property owned or operated by the Borrower or any of its Subsidiaries which
could reasonably be expected to have a Material Adverse Effect. To the best
knowledge of the Borrower, there are no conditions or occurrences on or
emanating from any property owned or operated by the Borrower or any of its
Subsidiaries or on any property adjoining or in the vicinity of any such
property that could reasonably be expected (i) to form the basis of an
Environmental Claim against the Borrower or any of its Subsidiaries or any
property owned or operated by the Borrower or any of its Subsidiaries, or (ii)
to cause any property owned or operated by the Borrower or any of its
Subsidiaries to be subject to any material restrictions on the ownership,
occupancy, the current or intended use or transferability of such property by
the Borrower or any of its Subsidiaries under any applicable Environmental Law
except for any such condition or occurrence described in clauses (i) or (ii)
which could not reasonably be expected to have a Material Adverse Effect.

                  (b) To the best knowledge of the Borrower (i) Hazardous
Materials have not at any time been generated, used, treated or stored on, or
transported to or from, any property owned or operated by the Borrower or any of
its Subsidiaries in a manner that has violated or could reasonably be expected
to violate any Environmental Law, except for such violations which could not
reasonably be expected to have a Material Adverse Effect, and (ii) Hazardous
Materials have not at any time been released on or from any property owned or
operated by the Borrower or any of its Subsidiaries in a matter that has
violated or could reasonably be expected to violate any Environmental Law,
except for such violation which could not reasonably be expected to have a
Material Adverse Effect.

         Section 5.19 [Intentionally Omitted].

         Section 5.20 Existing Indebtedness and Liens. The Borrower and its
Subsidiaries have no Indebtedness or Liens on any of their properties or assets
on the Effective Date other than as listed on SCHEDULE 5.20.

SECTION 6. COVENANTS.

         The Borrower covenants and agrees that, without the consent of the
Majority Lenders and so long as any Note, Letter of Credit or Reimbursement
Obligation or any other Obligation is outstanding or any L/C Commitment is
outstanding hereunder:

         Section 6.1 Existence. The Borrower and its Subsidiaries will preserve
and maintain their existence except (a) for the dissolution of any Subsidiaries
whose assets are transferred to the Borrower or any of its Subsidiaries; (b) the
Borrower shall not be required to preserve, renew or keep in full force and
effect the corporate or other existence of any Subsidiary, if the Board of
Directors of the Borrower shall determine in the exercise of its business
judgment that the preservation thereof is no longer desirable in the conduct of
business of the Borrower or any

                                       33

<PAGE>

Subsidiary and that abandonment of any such right shall not have a Material
Adverse Effect on the Borrower and its Subsidiaries, taken as a whole; and (iii)
as otherwise expressly permitted herein.

         Section 6.2 Maintenance. The Borrower and its Subsidiaries will
maintain, preserve and keep their material plants, properties and equipment
necessary to the proper conduct of their businesses in reasonably good repair,
working order and condition (normal wear and tear excepted) and will from time
to time make all reasonably necessary repairs, renewals, replacements, additions
and betterments thereto consistent with usual and customary business practices
so that at all times such plants, properties and equipment are reasonably
preserved and maintained, in each case with such exceptions as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect; provided, however, that nothing in this SECTION 6.2 shall
prevent the Borrower or any of its Subsidiaries from discontinuing the operation
or maintenance of any such plants, properties or equipment if such
discontinuance is, in the judgment of the Borrower or any such Subsidiary, as
applicable, desirable in the conduct of its business and not materially
disadvantageous to the Lenders.

         Section 6.3 Taxes. The Borrower and its Subsidiaries will duly pay and
discharge all Taxes upon or against them or their properties before penalties
accrue thereon, unless and to the extent that the same is being contested in
good faith and by appropriate proceedings and reserves have been established in
conformity with GAAP.

         Section 6.4 ERISA. The Borrower and its Subsidiaries will promptly pay
and discharge all obligations and liabilities arising under ERISA or otherwise
with respect to each Plan of a character which if unpaid or unperformed might
result in the imposition of a material Lien against any properties or assets of
the Borrower or any of its Subsidiaries and will promptly notify the Agent of
(a) the occurrence of any reportable event (as defined in ERISA) relating to a
Plan other than any such event with respect to which the PBGC has waived notice
by regulation; (b) receipt of any notice from PBGC of its intention to seek
termination of any Plan or appointment of a trustee therefor; (c) the Borrower's
or any of its Subsidiary's intention to terminate or withdraw from any Plan if
such termination or withdrawal would result in liability under Title IV of
ERISA; and (d) the occurrence of any event that could reasonably be expected to
result in the incurrence of any material liability, fine or penalty, or any
material increase in the contingent liability of the Borrower or any of its
Subsidiaries, in connection with any post-retirement benefit under a welfare
plan benefit (as defined in ERISA).

                                       34

<PAGE>

         Section 6.5 Insurance. The Borrower and its Subsidiaries will maintain
or cause to be maintained with responsible insurance companies, insurance
against any loss or damage to all material insurable property and assets owned
by them, such insurance to be of a character and in or in excess of such amounts
as are customarily maintained by companies similarly situated and operating like
property or assets, all of which policies shall name the Agent as a loss payee
for losses in excess of $50,000 and provide that no policy shall terminate
without at least thirty (30) days' advance written notice to the Agent and
otherwise be reasonably acceptable to the Agent. The Borrower and each of its
Subsidiaries will also insure employers' and public and product liability risks,
such insurance to be of a character and in or in excess of such amounts as are
customarily maintained by companies similarly situated and operating like
property or assets (with each liability insurance policy to name the Agent as an
additional insured) with responsible insurance companies, all as reasonably
acceptable to the Agent.

         Section 6.6 Financial Reports and Other Information.

                  (a) The Borrower and its Subsidiaries will maintain a system
of accounting in such manner as will enable preparation of financial statements
in accordance with GAAP and will furnish to the Agent and its authorized
representatives such information about the business and financial condition of
the Borrower and its Subsidiaries, including, without limitation, any corporate
documents and records, within such time period, as the Agent or any Lender may
reasonably request; and, without any request, will furnish to the Agent:

                           (i)      within forty-five (45) days after the end of
         each fiscal quarter of each fiscal year of the Borrower, the
         consolidated balance sheet of the Borrower and its Subsidiaries as at
         the end of such fiscal quarter and the related consolidated statements
         of income and retained earnings and of cash flows for such fiscal
         quarter and for the portion of the fiscal year ended with the last day
         of such fiscal quarter, and a summary of asset dispositions during such
         period and in the aggregate to date under SECTION 6.16(c), (d) and (e),
         all of which under this clause (ii) shall be in form and detail
         satisfactory to the Agent and in the case of consolidated statements,
         in the form filed with the SEC and within five (5) days thereafter, a
         certificate of an officer of the Borrower acceptable to the Agent that
         such financial reports fairly present the financial condition of the
         Borrower and its Subsidiaries as of the dates indicated and the results
         of their operations and changes in their cash flows for the periods
         indicated and that they have been prepared in accordance with GAAP, in
         each case, subject to normal year-end audit adjustments and the
         omission of any footnotes as permitted by the SEC; and

                           (ii)     within one hundred twenty (120) days after
         the end of each fiscal year of the Borrower, consolidated balance
         sheets of the Borrower and its Subsidiaries as at the end of such
         fiscal year and the related consolidated and consolidating statements
         of income and consolidated statements of retained earnings and of cash
         flows for such fiscal year and setting forth consolidated comparative
         figures for the preceding fiscal year and certified by an officer of
         the Borrower acceptable to the Agent to the effect that such statements
         fairly present the financial condition of the Borrower and its
         Subsidiaries as of the dates indicated and the results of their
         operations and changes in their cash flows, and in the case of the
         consolidated statements, audited by an independent
         nationally-recognized accounting firm acceptable to the Agent, whose
         opinion shall be in scope and substance in accordance with generally
         accepted auditing standards and, with respect to

                                       35

<PAGE>

         the audited financial statements for the Borrower's fiscal year 2002,
         shall not contain a going concern or other like qualification.

                  (b) Each financial statement furnished to the Agent pursuant
to SECTION 6.6(a)(i) and (ii) shall be accompanied by (i) a written certificate
signed by an officer of the Borrower acceptable to the Agent to the effect that
(x) no Default or Event of Default has occurred during the period covered by
such statements or, if any such Default or Event of Default has occurred during
such period, setting forth a description of such Default or Event of Default and
specifying the action, if any, taken by the Borrower to remedy the same, and (y)
the representations and warranties contained herein are true and correct in all
material respects as though made on the date of such certificate, except to the
extent that any such representation or warranty relates solely to an earlier
date, in which case it was true and correct as of such earlier date and except
as otherwise described therein, as a result of the transactions expressly
permitted hereunder or as previously disclosed to the Lenders, and (ii) a
Compliance Certificate substantially in the form of EXHIBIT 6.6.

         Section 6.7 Lenders' Inspection Rights. Upon reasonable notice from the
Agent or any Lender, the Borrower will permit the Agent or any Lender (and such
Persons as the Agent or any Lender may reasonably designate), at the Borrower's
expense while an Event of Default has occurred and is continuing, during normal
business hours following reasonable notice to visit and inspect any of the
properties of the Borrower or any of its Subsidiaries, to examine all of their
books and records, to make copies and extracts therefrom, and to discuss their
respective affairs, finances and accounts with their respective officers and
independent public accountants (and by this provision, the Borrower authorizes
such accountants to discuss with the Agent or any Lender, and such Persons as
the Agent or any Lender may reasonably designate, the affairs, finances and
accounts of the Borrower and its Subsidiaries provided that the Borrower has the
opportunity to be present at such discussions), all at such reasonable times and
as often as may be reasonably requested.

         Section 6.8 Conduct of Business. The Borrower and its Subsidiaries will
not engage in any line of business other than the specialty electric and
telecommunications infrastructure contracting service business, electrical
contracting services, installation of transportation, control and lighting
equipment and services or businesses reasonably related thereto (each, a
"PERMITTED BUSINESS").

         Section 6.9 New Subsidiaries and Additional Collateral. The Borrower
shall (i) cause any direct or indirect domestic Subsidiary which is formed or
acquired after the Effective Date to become a Guarantor with respect to, and
jointly and severally liable with all other Guarantors for, all of the
Obligations under this Agreement and the Notes pursuant to a Guaranty
substantially in the form of the Existing Subsidiary Guaranties and to execute
and deliver a security agreement substantially in the form of the Existing
Security Agreements (and if applicable, a patent collateral assignment
substantially in the form of the Existing Patent Collateral Assignment),
together with a UCC-1 Financing Statement with respect to the assets of such
Guarantor as set forth therein, and (ii) execute and deliver and cause any
domestic Subsidiary to execute and deliver to the Agent a pledge agreement
substantially in the form of the Existing Pledge Agreements, in respect of any
domestic Subsidiary formed or acquired after the Effective Date and to deliver
the original stock certificates for any such Subsidiary as set forth therein (or
other evidence of its ownership interest therein) and undated stock powers

                                       36

<PAGE>

executed in blank with respect thereto, in each case within five (5) days
following such formation or acquisition. The Borrower shall provide to the Agent
a list of all its Subsidiaries with the state or country of incorporation and
the location of the principal place of business of each such Subsidiary at the
same time as it provides its quarterly financial reports to the Agent pursuant
to SECTION 6.6(a)(i). Upon demand by the Agent, the Borrower shall promptly
execute and deliver to the Agent, and shall cause its domestic Subsidiaries to
promptly execute and deliver to the Agent, such other and further security
documents as may be reasonably requested by the Agent to perfect a Lien on its
rolling stock and all equipment with certificates of title. Nothing in this
SECTION 6.9 may be construed as permitting any action not permitted by SECTION
6.11.

         Section 6.10 Dividends and Negative Pledges.


                  (a) The Borrower shall not pay any dividends or other
distributions on its capital stock other than (i) dividends made wholly in the
form of additional shares of the Borrower's capital stock, provided that, in
respect of any stock split, the Borrower may make cash distributions in lieu of
issuing fractional shares of capital stock which would otherwise result from
such stock split, and (ii) repurchases of common stock of the Borrower from
officers, directors and employees pursuant to the Borrower's restricted stock
option or compensation programs, to pay withholdings in respect of taxes owed as
a result of grants of stock options and stock compensation thereunder, so long
as the Borrower's performance of its obligations under such restricted stock
option or compensation programs cannot reasonably be expected to have a material
negative impact on projected cash flows.

                  (b) Except as otherwise permitted herein, neither the Borrower
nor any of its Subsidiaries shall, directly or indirectly, create or otherwise
permit to exist or become effective any restriction on the ability of any
Subsidiary of the Borrower to (i) pay dividends or make any other distributions
on its capital stock or any other interest or participation in its profits owned
by the Borrower or to pay any Indebtedness owed to the Borrower, or (ii) make
loans or advances to the Borrower or any of its Subsidiaries, except in either
case for restrictions existing under or by reason of applicable law, this
Agreement and the other Credit Documents.

                  (c) Neither the Borrower nor any of its Subsidiaries shall
enter into any agreement creating or assuming any Lien upon its properties,
revenues or assets, whether now owned or hereafter acquired other than as
permitted hereunder. Neither the Borrower nor any of its Subsidiaries shall
enter into any agreement other than this Agreement and the Credit Documents
prohibiting the creation or assumption of any Lien upon its properties, revenues
or assets, whether now owned or hereafter acquired or prohibiting or restricting
the ability of the Borrower or any of its Subsidiaries to amend or otherwise
modify this Agreement or any Credit Document.

         Section 6.11 Restrictions on Fundamental Changes. Neither the Borrower
nor any of its Subsidiaries shall be a party to any merger into or consolidation
with, make an Acquisition or otherwise purchase or acquire all or substantially
all of the assets or stock of, any other Person, or sell all or substantially
all of its assets or stock (other than as permitted under SECTION 6.16), except:

                                       37

<PAGE>

                  (a) the Borrower or any of its Subsidiaries may merge into or
consolidate with, make an Acquisition or otherwise purchase or acquire all or
substantially all of the assets or stock of any other Person, so long as (i) the
Borrower is the surviving entity to any such merger or consolidation to which
the Borrower is a party, or, if the Borrower is not a party to such transaction,
a domestic Subsidiary is the surviving entity to any such merger or
consolidation or the other Person will thereby become a domestic Subsidiary
(unless no party to such transaction is a domestic Subsidiary, in which case the
applicable foreign Subsidiary must be the surviving entity to any such merger or
consolidation or the other Person must thereby become a foreign Subsidiary),
(ii) the nature of the business of such acquired Person is a Permitted Business,
provided that, Acquisitions will be primarily focused on acquiring Persons whose
business activities are restricted to the specialty electric and infrastructure
contracting service business and utility outsourcing business, (iii) no Default
or Event of Default shall have occurred and be continuing or would otherwise be
existing as a result of such merger, consolidation, purchase or Acquisition,
(iv) such merger, consolidation, purchase or Acquisition is non-hostile in
nature, (v) with respect to any such merger, consolidation, purchase or
Acquisition, the amount of the cash portion of the consideration paid by the
Borrower and its Subsidiaries in respect thereof does not exceed (A) $20,000,000
if, at the time of such transaction, the Borrower's Net Funded Debt to EBITDA
Ratio as of the end of the immediately preceding fiscal quarter is greater than
or equal to 3.50 to 1.00, or (B) $40,000,000 if, at the time of such
transaction, the Borrower's Net Funded Debt to EBITDA Ratio as of the end of the
immediately preceding fiscal quarter is less than 3.50 to 1.00, and (vi) with
respect to all such mergers, consolidations, purchases or Acquisitions, the
aggregate amount of the cash portion of the consideration paid by the Borrower
and its Subsidiaries in respect thereof during any 12 month period, does not
exceed (A) $40,000,000 if, at the time of any such transaction, the Borrower's
Net Funded Debt to EBITDA Ratio as of the end of the immediately preceding
fiscal quarter is greater than or equal to 3.50 to 1.00, or (B) $80,000,000 if,
at the time of any such transaction, the Borrower's Net Funded Debt to EBITDA
Ratio as of the end of the immediately preceding fiscal quarter is less than
3.50 to 1.00; and

                  (b) the Borrower may purchase or otherwise acquire all or
substantially all of the stock or assets of, or otherwise acquire by merger or
consolidation, any of its Subsidiaries, and any such Subsidiary may merge into,
or consolidate with, or purchase or otherwise acquire all or substantially all
of the assets or stock of or sell all or substantially all of its assets or
stock to, any other Subsidiary of the Borrower or the Borrower, in each case so
long as (i) if the transaction is with the Borrower, the Borrower shall be the
surviving entity to any such merger or consolidation, or (ii) if the transaction
is not with the Borrower, a domestic Subsidiary shall be the surviving entity to
any such merger or consolidation (unless no party to such transaction is a
domestic Subsidiary).

Except as otherwise permitted in this SECTION 6.11 and SECTION 6.16, the
Borrower shall not sell or dispose of any capital stock of or its ownership
interest in any of the Guarantors or any other Subsidiaries which it may form.
Borrower shall give the Agent the notice required under SECTION 6.9.

         Section 6.12 Environmental Laws. The Borrower and its Subsidiaries
shall comply with all Environmental Laws (including, without limitation,
obtaining and maintaining all necessary permits, licenses and other necessary
authorizations) applicable to or affecting the

                                       38

<PAGE>

properties or business operations of the Borrower or any of its Subsidiaries
except where the failure to so comply could not reasonably be expected to have a
Material Adverse Effect.

         Section 6.13 Liens. The Borrower and its Subsidiaries shall not create,
incur, assume or suffer to exist any Lien of any kind on any of their properties
or assets of any kind except the following (collectively, the "PERMITTED
LIENS"):

                  (a) Liens arising in the ordinary course of business by
operation of law in connection with workers' compensation, unemployment
insurance, old age benefits, social security obligations, taxes, assessments,
statutory obligations or other similar charges, good faith deposits, pledges or
other Liens in connection with (or to obtain letters of credit in connection
with) bids, performance bonds, contracts or leases to which the Borrower or its
Subsidiaries are a party or other deposits required to be made in the ordinary
course of business; provided that in each case the obligation secured is not for
Indebtedness and is not overdue or, if overdue, is being contested in good faith
by appropriate proceedings and reserves in conformity with GAAP have been
provided therefor;

                  (b) mechanics', workmen, materialmen, landlords', carriers' or
other similar Liens arising in the ordinary course of business (or deposits to
obtain the release of such Liens) related to obligations not due or, if due,
that are being contested in good faith by appropriate proceedings and reserves
in conformity with GAAP have been provided therefor;

                  (c) inchoate Liens under ERISA and Liens for Taxes not yet due
or which are being contested in good faith by appropriate proceedings and
reserves in conformity with GAAP have been provided therefor;

                  (d) Liens arising out of judgments or awards against the
Borrower or any of its Subsidiaries, or in connection with surety or appeal
bonds or the like in connection with bonding such judgments or awards, the time
for appeal from which or petition for rehearing of which shall not have expired
or for which the Borrower or such Subsidiary shall be prosecuting on appeal or
proceeding for review and for which it shall have obtained a stay of execution
or the like pending such appeal or proceeding for review; provided that the
aggregate amount of uninsured or underinsured liabilities (including interest,
costs, fees and penalties, if any) of the Borrower and its Subsidiaries secured
by such Liens shall not exceed $1,000,000 at any one time outstanding and
provided further there is adequate assurance, in the sole reasonable discretion
of the Lenders, that the insurance proceeds attributable thereto shall be paid
promptly upon the expiry of such time period or resolution of such proceeding if
necessary to remove such Liens;

                  (e) rights of a common owner of any interest in property held
by a Person and such common owner as tenants in common or through other common
ownership;

                  (f) encumbrances (other than to secure the payment of
Indebtedness), easements, restrictions, servitudes, permits, conditions,
covenants, exceptions or reservations in any property or rights-of-way of a
Person for the purpose of roads, pipelines, transmission lines, transportation
lines, distribution lines, removal of gas, oil, coal, metals, steam, minerals,
timber or other natural resources, and other like purposes, or for the joint or
common use of real property, rights-of-way, facilities or equipment, or defects,
irregularity and deficiencies in title of any property or rights-of-way which do
not materially diminish the value of or the ability to use such property;

                                       39

<PAGE>

                  (g) financing statements filed by lessors of property (but
only with respect to the property so leased) and Liens under any conditional
sale or title retention agreements entered into in the ordinary course of
business;

                  (h) rights of lessees of equipment owned by the Borrower or
any of its Subsidiaries;

                  (i) Liens on assets acquired securing Indebtedness permitted
by SECTION 6.14(e); provided that no such Liens shall encumber accounts,
accounts receivable, inventory (other than purchase money Liens), cash, deposit
accounts, Cash Equivalents, general intangibles, intellectual property or any
stock or other ownership interests in any Subsidiaries;

                  (j) existing Liens listed on SCHEDULE 6.13 and any extension,
renewal or replacement (but not increase) thereof;

                  (k) Liens created by the Credit Documents;

                  (l) Liens on any assets acquired in an Acquisition, provided
that all such Liens, other than Permitted Liens listed in (a) through (k) of
this Section, shall be released and any notice thereof removed from the public
records on or before thirty (30) days after the date of such Acquisition; and

                  (m) Liens on assets acquired with Indebtedness permitted by
SECTION 6.14(E), so long as such Liens attach only to the assets acquired with
such Indebtedness.

         Section 6.14 Indebtedness. The Borrower and its Subsidiaries shall not
contract, assume or suffer to exist any Indebtedness (including, without
limitation, any Guaranties), except:

                  (a) Indebtedness under the Credit Documents;

                  (b) unsecured intercompany loans and advances from the
Borrower to any of its Subsidiaries and unsecured intercompany loans and
advances from any of such Subsidiaries to the Borrower or any other Subsidiaries
of the Borrower;

                  (c) unsecured Indebtedness to a seller incurred in connection
with an Acquisition, provided that such Indebtedness is subordinated in payment
to the Obligations hereunder as reasonably acceptable to the Agent, such
Indebtedness contains covenants no more restrictive than the covenants contained
in this Agreement, and standstill provisions reasonably acceptable to the Agent
and no payments may be made thereon if a Default or Event of Default shall have
occurred and be continuing or would occur as a result of any such payment;

                  (d) Indebtedness under any Interest Rate Protection Agreements
entered into to protect the Borrower against fluctuations in interest rates and
not for speculative purposes;

                  (e) Purchase money Indebtedness incurred in the ordinary
course of business not to exceed an aggregate amount of $25,000,000 outstanding
at any time;

                                       40

<PAGE>

                  (f) Indebtedness under the Subordinated Indenture, including
without limitation, the Indebtedness under the Convertible Subordinated Notes
and the First Supplemental Indenture; provided that the principal amount of such
Indebtedness shall not at any time exceed $172,500,000;

                  (g) Indebtedness under the 2003 Note Purchase Agreement,
including without limitation, the Indebtedness under the 2003 Convertible
Subordinated Notes; provided that, the principal amount of such Indebtedness
shall not at any time exceed $275,000,000; and

                  (h) Guaranties from domestic Subsidiaries entered into or
delivered in connection with the 2003 Convertible Subordinated Notes and
obligations covered by CLAUSE (vi) of the definition of Indebtedness to the
extent that such obligations are entered into or arise in connection with the
2003 Convertible Subordinated Notes.

         Section 6.15 Loans, Advances and Investments. The Borrower and its
Subsidiaries shall not lend money or make advances to any Person, or purchase or
acquire any stock, indebtedness, obligations or securities of, or any other
interest in, or make any capital contribution to, any Person (any of the
foregoing, an "INVESTMENT") other than:

                  (a) Investments in Cash Equivalents;

                  (b) receivables owing to the Borrower or its Subsidiaries
created or acquired in the ordinary course of business and payable on customary
trade terms of the Borrower or such Subsidiary and in compliance with the
requirements of SECTION 6.17;

                  (c) Investments received in connection with the bankruptcy or
reorganization of suppliers and customers and in settlement of delinquent
obligations of, and other disputes with, customers and suppliers arising in the
ordinary course of business;

                  (d) deposits made in the ordinary course of business
consistent with past practices to secure the performance of leases;

                  (e) as permitted by SECTION 6.14(b);

                  (f) to the extent permitted by, and in compliance with,
applicable law, loans to employees of the Borrower or any of its Subsidiaries,
provided that all such loans shall not exceed $2,000,000 at any one time;

                  (g) Investments made in Persons other than Borrower or its
Subsidiaries, provided that, such Investments made after the date of this
Agreement, may not, in the aggregate, exceed $5,000,000;

                  (h) as permitted by SECTION 6.11;

                  (i) Investments in Lightwave L.L.C., an Alabama limited
liability company (or any of its successors or assigns), provided that all such
Investments (whether by cash or contribution of assets, but excluding the
reinvestment of its retained earnings) after December 31, 1999 may not in the
aggregate exceed $5,000,000;

                                       41

<PAGE>

                  (j) [intentionally omitted]; and

                  (k) Investments made prior to the date of this Agreement in
"landfill gas to energy" projects and other cogeneration projects, including
without limitation, Investments in Network Electric Company.

         Section 6.16 Transfer of Assets. The Borrower and its Subsidiaries
shall not permit any sale, transfer, conveyance, assignment or other disposition
of any asset of the Borrower or any of its Subsidiaries except:

                  (a) transfers of inventory in the ordinary course of business;

                  (b) the retirement or replacement of assets (with assets of
equal or greater value) in the ordinary course of business;

                  (c) transfers of any assets among (i) the Borrower and its
non-domestic Subsidiaries not to exceed, in the aggregate, $5,000,000, or (ii)
the Borrower and any of its domestic Subsidiaries;

                  (d) sales, transfers or conveyances of accounts receivable for
fair and adequate consideration and for cash; and

                  (e) to the extent not included in clauses (a) through (d)
above, dispositions of assets (including for the avoidance of doubt, the capital
stock of any Subsidiary provided that all of the capital stock of such
Subsidiary owned by the Borrower and/or any of its other Subsidiaries is sold or
disposed), for fair and adequate consideration and for cash, provided that,
dispositions under this SUBSECTION (e) may not, in the aggregate, exceed
$10,000,000 in book value during any 12 month period.

                  In connection with any transfer or other disposition of assets
of the Borrower or any of its Subsidiaries or of any other Collateral, in each
case that is permitted by this Agreement or any other Credit Document
(including, without limitation, any such transfer or disposition pursuant to
this SECTION 6.16), the Agent and the Lenders shall, in connection with the
consummation of such transfer or disposition, promptly release all security
interests in and other Liens on any such assets and Collateral.

         Section 6.17 Transactions with Affiliates. Except as otherwise
specifically permitted herein, the Borrower and its Subsidiaries shall not enter
into or be a party to any material transaction or arrangement or series of
related transactions or arrangements which in the aggregate would be material
with any Affiliate of such Person, including without limitation, the purchase
from, sale to or exchange of property with or the rendering of any service by or
for, any Affiliate, except pursuant to the reasonable requirements of such
entity's business and upon fair and reasonable terms no less favorable to such
entity than would be able to be obtained in a comparable arm's-length
transaction with a Person other than an Affiliate.

         Section 6.18 Compliance with Laws. The Borrower and its Subsidiaries
shall conduct their businesses and otherwise be in compliance in all material
respects with all applicable laws, regulations, ordinances and orders of all
governmental, judicial and arbitral authorities applicable to them and shall
obtain and maintain all necessary permits, licenses and other authorizations

                                       42

<PAGE>

necessary to conduct their businesses and own and operate their properties
except where the failure to comply or have such permits, licenses or other
authorizations could not reasonably be expected to have a Material Adverse
Effect.

         Section 6.19 Capital Expenditures.

                  (a) Neither the Borrower nor any of its Subsidiaries shall
make or commit to make Capital Expenditures during any fiscal year, which, in
the aggregate, exceed 50% of EBITDA for the 12 month period ending on the last
day of the immediately preceding fiscal year.

                  (b) In addition to the annual limits under SECTION 6.19(a), if
the Borrower executes an eligible contract, then the Borrower may make Capital
Expenditures in respect of such contract in an amount equal to the lesser of (i)
the actual amount required by such contract, and (ii) $30,000,000, provided
that, (A) in respect of each such contract, Capital Expenditures not made within
12 months after the date of such contract shall be applied against the annual
limits under SECTION 6.19(a), and (b) the amount of Capital Expenditures under
this SECTION 6.19(b) for all such contracts may not, in the aggregate, exceed
$30,000,000 in any fiscal year. Upon execution of each eligible contract, the
Borrower shall promptly deliver a copy of such contract to the Agent, together
with a summary of the Capital Expenditures required by such contract in form and
detail reasonably acceptable to the Agent. As used in this SECTION 6.19(b),
"ELIGIBLE CONTRACT" means, a utility outsourcing contract with quantifiable
revenues to the Borrower of at least $30,000,000 during any period of 12
consecutive months prior to the date that is 18 months after the date of such
contract.

         Section 6.20 Minimum Consolidated Net Worth. The Borrower will maintain
a minimum Consolidated Net Worth of not less than an amount equal to the sum of
(a) $570,000,000, plus (b) for each fiscal quarter ended prior to (but not on)
such date of determination, commencing with the fiscal quarter ended December
31, 2003, the total of (i) an amount equal to 50% of Consolidated Net Income for
such fiscal quarter, if positive, plus (ii) an amount equal to 100% of the
amount of any equity issuance by the Borrower, including equity issued in a
secondary offering or equity issued to acquire another entity in an Acquisition,
minus (iii) Permitted Charges which are applicable to such period, minus (iv)
without duplication, all Non-Cash Charges. Increases in Consolidated Net Worth
shall be appropriately adjusted to eliminate any adverse effects occasioned by
the expensing of Make-Whole Amounts (as defined in the Note Purchase Agreement)
paid pursuant to the Note Purchase Agreement.

         Section 6.21 Minimum Interest Coverage Ratio. The Borrower will
maintain a Minimum Interest Coverage Ratio not less than the ratio set out below
for the applicable period:

<TABLE>
<S>                                                 <C>
For the period ending December 31, 2003:            1.50 to 1.00
For the period ending March 31, 2004:               1.50 to 1.00
For the period ending June 30, 2004:                1.50 to 1.00
For the period ending September 30, 2004:           1.75 to 1.00
For the period ending December 31, 2004:            2.00 to 1.00
</TABLE>

                                       43

<PAGE>

         Section 6.22 Net Funded Debt to EBITDA Ratio. The Borrower will
maintain a maximum Net Funded Debt to EBITDA Ratio not greater than the ratio
set out below for the applicable period:

<TABLE>
<S>                                                 <C>
For the period ending December 31, 2003:            5.00 to 1.00
For the period ending March 31, 2004:               5.00 to 1.00
For the period ending June 30, 2004:                5.00 to 1.00
For the period ending September 30, 2004:           4.50 to 1.00
For the period ending December 31, 2004:            4.50 to 1.00
</TABLE>

         Section 6.23 Net Senior Funded Debt to EBITDA. The Borrower will
maintain a maximum Net Senior Funded Debt to EBITDA Ratio not greater than 2.00
to 1.00, tested quarterly as of the last day of each fiscal quarter for the
fiscal quarter then ended.

         Section 6.24 Minimum Asset Coverage. The Borrower will maintain a
Minimum Asset Coverage Ratio of not less than 2.50 to 1.00, tested quarterly as
of the last day of each fiscal quarter for the fiscal quarter then ended.

         Section 6.25 Subordinated Debt Investment. The Borrower shall provide
written notice to the Agent (by confirmed fax to each of the Agent and its legal
counsel, Winstead Sechrest & Minick P.C., attention: Ms. Valinda Wolfert (fax
no.: 214-745-5390)) of (i) any Change in Control within two (2) Business Days
following any such Change in Control, and (ii) any notice received by the
Borrower from any holder of a Subordinated Debt Investment exercising any right
to (a) require the Borrower to redeem or (b) in respect of the Convertible
Subordinated Notes or 2003 Convertible Subordinated Notes, convert, in either
case as applicable, all or any part of a Subordinated Debt Investment within two
(2) Business Days of the Borrower's receipt thereof. The Borrower shall not
redeem, pursuant to any optional redemption right it may have, all or any part
of a Subordinated Debt Investment before the Maturity Date. The Borrower shall
not amend, modify or change in any way any provision of a Subordinated Debt
Investment so as to change the stated maturity date of the principal of such
Indebtedness, or any installment of interest thereon, to an earlier date,
increase the rate of interest thereon or any premium payable on the redemption
thereof, change any of the redemption or subordination provisions thereof (or
the definitions of any defined terms contained therein) or otherwise change in
any respect materially adverse to the interests of the Lenders any of the terms
thereof, in each case, without the consent of the Majority Lenders.

SECTION 7. EVENTS OF DEFAULT AND REMEDIES.

         Section 7.1 Events of Default. Any one or more of the following shall
constitute an Event of Default:

                  (a) default by the Borrower in the payment of the principal
amount of any Loan or any Reimbursement Obligation when it becomes due and
payable under this Agreement, or in the payment of any interest thereon or any
fees payable hereunder within five (5) days following the date when due;

                  (b) default by the Borrower in the observance or performance
of any covenant set out in SECTIONS 6.10(a), 6.11, 6.16, or 6.25;

                                       44

<PAGE>

                  (c) default by the Borrower in the observance or performance
of any provision hereof or of any other Credit Document not mentioned in (a) or
(b) above which is not remedied within thirty (30) days after the earlier of (i)
such default or event of default first becoming known to any officer of the
Borrower, or (ii) notice to the Borrower by the Agent of the occurrence of such
default or event of default;

                  (d) any representation or warranty made or deemed made herein,
in any other Credit Document or in any financial or other report or document
furnished in compliance herewith or therewith by the Borrower or any of its
Subsidiaries proves untrue in any material respect as of the date of the
issuance or making, or deemed issuance or making thereof;

                  (e) default occurs in the payment when due (after any
applicable grace period) of Indebtedness in an aggregate principal amount of
$1,000,000 or more of the Borrower or any of its Subsidiaries, or the occurrence
of any other default, which with the passage of time or notice would permit the
holder or beneficiary of such Indebtedness, or a trustee therefor, to cause the
acceleration of the maturity of any such Indebtedness or any mandatory
unscheduled prepayment, purchase, or other early funding thereof;

                  (f) the Borrower or any of its Subsidiaries (i) has entered
involuntarily against it an order for relief under the United States Bankruptcy
Code or a comparable action is taken under any bankruptcy or insolvency law of
another country or political subdivision of such country, (ii) generally does
not pay, or admits its inability generally to pay, its debts as they become due,
(iii) makes a general assignment for the benefit of creditors, (iv) applies for,
seeks, consents to, or acquiesces in, the appointment of a receiver, custodian,
trustee, examiner, liquidator or similar official for it or any substantial part
of its property, (v) institutes any proceeding seeking to have entered against
it an order for relief under the United States Bankruptcy Code or any comparable
law, to adjudicate it insolvent, or seeking dissolution, winding up,
liquidation, reorganization, arrangement, adjustment or composition of it or its
debts under any law relating to bankruptcy, insolvency or reorganization or
relief of debtors or fails to file an answer or other pleading denying the
material allegations of any such proceeding filed against it, (vi) makes any
board of directors resolution in direct furtherance of any matter described in
clauses (i)-(v) above, or (vii) fails to contest in good faith any appointment
or proceeding described in SECTION 7.1(g);

                  (g) a custodian, receiver, trustee, examiner, liquidator or
similar official is appointed for the Borrower or any of its Subsidiaries or any
substantial part of its property, or a proceeding described in SECTION 7.1(f)(v)
is instituted against the Borrower or any of its Subsidiaries, and such
appointment continues undischarged or such proceeding continues undismissed or
unstayed for a period of sixty (60) days;

                  (h) the Borrower or any of its Subsidiaries fails within
thirty (30) days (or such earlier date as any steps to execute on such judgment
or order take place) to pay, bond or otherwise discharge, or to obtain an
indemnity against on terms and conditions satisfactory to the Lenders in their
reasonable discretion, any one or more judgments or orders for the payment of
money in excess of $1,000,000 in the aggregate which is uninsured or
underinsured by at least such amount (provided that there is adequate assurance,
in the sole discretion of the Lenders, that the insurance proceeds attributable
thereto shall be paid promptly upon the expiration of such

                                       45

<PAGE>

time period or resolution of such proceeding), which is not stayed on appeal or
otherwise being appropriately contested in good faith in a manner that stays
execution;

                  (i) the Borrower or any of its Subsidiaries fails to pay when
due an amount aggregating in excess of $1,000,000 that it is liable to pay to
the PBGC or to a Plan under Title IV of ERISA; or a notice of intent to
terminate a Plan having Unfunded Vested Liabilities of the Borrower or any of
its Subsidiaries in excess of $1,000,000 (a "MATERIAL PLAN") is filed under
Title IV of ERISA; or the PBGC institutes proceedings under Title IV of ERISA to
terminate or to cause a trustee to be appointed to administer any Material Plan;
or a proceeding is instituted by a fiduciary of any Material Plan against the
Borrower or any of its Subsidiaries to collect any liability under Section 515
or 4219(c)(5) of ERISA and such proceeding is not dismissed within thirty (30)
days thereafter; or a condition exists by reason of which the PBGC would be
entitled to obtain a decree adjudicating that any Material Plan must be
terminated;

                  (j) the Borrower, any Guarantor, any Person acting on behalf
of the Borrower or any Guarantor, or any governmental, judicial or arbitral
authority challenges the validity of any Credit Document or the Borrower's or
any Guarantor's obligations thereunder, or any Credit Document ceases to be in
full force and effect in all material respects or ceases to give to the Agent
and the Lenders the rights and powers purported to be granted in its favor
thereby in all material respects other than for any reason solely caused by or
within the sole control of the Agent or any Lender;

                  (k) a Change in Control shall occur or the common stock of the
Borrower shall be delisted from the New York Stock Exchange;

                  (l) an Event of Default shall occur and be continuing under
any documents evidencing a Subordinated Debt Investment;

                  (m) an event of default shall occur and be continuing under
(i) the Subordinated Indenture, the First Supplemental Indenture or the
Convertible Subordinated Notes, or any other document evidencing Indebtedness
under the Subordinated Indenture, the First Supplemental Indenture or the
Convertible Subordinated Notes, or (ii) the 2003 Note Purchase Agreement or the
2003 Convertible Subordinated Notes, or any other document evidencing
Indebtedness under the 2003 Note Purchase Agreement or the 2003 Convertible
Subordinated Notes.

         Section 7.2 Non-Bankruptcy Defaults. When any Event of Default other
than those described in subsections (f) or (g) of SECTION 7.1 has occurred and
is continuing, the Agent shall, by notice to the Borrower: (a) if so directed by
the Majority Lenders, terminate the remaining L/C Commitments and all other
obligations of the Lenders hereunder on the date stated in such notice (which
may be the date thereof); (b) if so directed by the Majority Lenders, declare
the principal of and the accrued interest on all outstanding Notes to be
forthwith due and payable and thereupon all outstanding Notes, including both
principal and interest thereon, shall be and become immediately due and payable
together with all other amounts payable under the Credit Documents without
further demand, presentment, protest or notice of any kind, including, but not
limited to, notice of intent to accelerate and notice of acceleration, each of
which is expressly waived by the Borrower; and (c) if so directed by the
Majority Lenders, demand that the Borrower immediately pay to the Agent (to be
held by the Agent pursuant to SECTION 7.4) the full amount then available for
drawing under each or any outstanding Letter of Credit to the extent

                                       46

<PAGE>

any such Letter of Credit is not already cash collateralized; and the Borrower
agrees to immediately make such payment and acknowledges and agrees that neither
the Agent nor the Lenders would have an adequate remedy at law for failure by
the Borrower to honor any such demand and that the Agent, for the benefit of the
Lenders shall have the right to require the Borrower to specifically perform
such undertaking whether or not any drawings or other demands for payment have
been made under any Letter of Credit. The Agent, after giving notice to the
Borrower pursuant to SECTION 7.1(c) or (d) or this SECTION 7.2, shall also
promptly send a copy of such notice to the other Lenders, but the failure to do
so shall not impair or annul the effect of such notice.

         Section 7.3 Bankruptcy Defaults. When any Event of Default described in
subsections (f) or (g) of SECTION 7.1 has occurred and is continuing with
respect to the Borrower, then (i) all outstanding Notes shall immediately and
automatically become due and payable together with all other amounts payable
under the Credit Documents without presentment, demand, protest or notice of any
kind, each of which is expressly waived by the Borrower, (ii) all obligations of
the Agent or any Lender to extend further credit pursuant to any of the terms
hereof shall immediately terminate, and (iii) the Borrower shall immediately pay
to the Agent (to be held by the Agent pursuant to SECTION 7.4) the full amount
then available for drawing under all outstanding Letters of Credit to the extent
any such Letter of Credit is not already cash collateralized, the Borrower
acknowledging and agreeing that neither the Agent nor the Lenders would have an
adequate remedy at law for failure by the Borrower to honor any such demand and
that the Agent and the Lenders shall have the right to require the Borrower to
specifically perform such undertaking whether or not any drawings or other
demands for payment have been made under any of the Letters of Credit.

         Section 7.4 Collateral for Undrawn Letters of Credit.

                  (a) If the prepayment of the amount available for drawing
under any or all outstanding Letters of Credit is required under SECTION 7.2 or
7.3, the Borrower shall forthwith pay the amount required to be so prepaid, to
be held by the Agent as provided in subsection (b) below.

                  (b) All amounts prepaid pursuant to subsection (a) above shall
be held by the Agent in a separate collateral account (such account, and the
credit balances, properties and any investments from time to time held therein,
and any substitutions for such account, any certificate of deposit or other
instrument evidencing any of the foregoing and all proceeds of and earnings on
any of the foregoing being collectively called the "COLLATERAL ACCOUNT") as
security for, and for application by the Agent (to the extent available) to, the
reimbursement of any drawing under any Letter of Credit then or thereafter made
by the Agent, and to the payment of the unpaid balance of any Loans and all
other due and unpaid Obligations (collectively, the "COLLATERALIZED
OBLIGATIONS"). The Collateral Account shall be held in the name of and subject
to the exclusive dominion and control of the Agent, for the benefit of the
Lenders, as pledgee hereunder. If and when requested by the Borrower, the Agent
shall invest and reinvest funds held in the Collateral Account from time to time
in Cash Equivalents specified from time to time by the Borrower, provided that
the Agent is irrevocably authorized to sell investments held in the Collateral
Account when and as required to make payments out of the Collateral Account for
application to Collateralized Obligations due and owing from the Borrower to the
Lenders. If such funds have been deposited pursuant to SECTION 7.2 or 7.3, when
and if either (i) the

                                       47

<PAGE>

Borrower shall have made payment of all Collateralized Obligations then due and
payable, all relevant preference or other disgorgement periods relating to the
receipt of such payments have passed, and no Letters of Credit, L/C Commitments,
Loans, Reimbursement Obligations or other Obligations remain outstanding or (ii)
no Default or Event of Default shall be continuing hereunder, the Agent shall
repay to the Borrower any remaining amounts held in the Collateral Account.

         Section 7.5 Notice of Default. The Agent shall give notice to the
Borrower under SECTION 7.1(c) and (d) and 7.2 promptly upon being requested to
do so by the Majority Lenders and shall thereupon notify all the Lenders
thereof.

         Section 7.6 Application of Proceeds. After the occurrence of and during
the continuance of an Event of Default, any payment to the Agent hereunder or
from the proceeds of any cash collateral shall be applied as the Agent and the
Lenders shall elect in their sole discretion.

SECTION 8. CHANGE IN CIRCUMSTANCES.

         Section 8.1 Change of Law. Notwithstanding any other provisions of this
Agreement or any Note, if at any time any change in applicable law or regulation
or in the interpretation thereof makes it unlawful for any Lender to make or
continue to maintain LIBOR Loans or to give effect to its obligations as
contemplated hereby, such Lender shall promptly give written notice thereof
(which notice shall specify in reasonable detail the basis therefor) to the
Borrower and such Lender's obligations to make, continue or convert Loans into
LIBOR Loans under this Agreement shall be suspended until it is no longer
unlawful for such Lender to make or maintain LIBOR Loans. The Borrower shall
prepay on demand the outstanding principal amount of any such affected LIBOR
Loans, together with all interest accrued thereon and all other amounts then due
and payable to such Lender under this Agreement; provided, however, subject to
all of the terms and conditions of this Agreement, the Borrower may then elect
to borrow the principal amount of the affected LIBOR Loans from such Lender by
means of Base Rate Loans from such Lender that shall not be made ratably by the
Lenders but only by such affected Lender.

         Section 8.2 Unavailability of Deposits or Inability to Ascertain LIBOR
Rate. If on or before the first day of any Interest Period for any LIBOR Loan
the Agent determines (after consultation with other Lenders) that, due to
changes in circumstances since the date hereof, adequate and fair means do not
exist for determining the Adjusted LIBOR Rate or such rate will not accurately
reflect the cost to the Majority Lenders of funding LIBOR Loans for such
Interest Period, the Agent shall give written notice of such determination
(which notice shall specify in reasonable detail the basis therefor) to the
Borrower and the Lenders, whereupon until the Agent notifies the Borrower and
Lenders that the circumstances giving rise to such suspension no longer exist,
the obligations of the Lenders to make, continue or convert Loans into LIBOR
Loans shall be suspended.

         Section 8.3 Increased Cost and Reduced Return.

                  (a) If, on or after the Effective Date, the adoption of or any
change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation

                                       48

<PAGE>

or administration thereof, or compliance by any Lender (or its Lending Office),
including the Agent in its capacity as the issuer of Letters of Credit, with any
request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency:

                           (i)      subjects any Lender of that type (or its
         Lending Office) to any tax, duty or other charge related to any LIBOR
         Loan, Letter of Credit or Reimbursement Obligation, or its
         participation in any thereof, or its obligation to advance or maintain
         LIBOR Loans, issue Letters of Credit or to participate therein, or
         shall change the basis of taxation of payments to any Lender (or its
         Lending Office) of the principal of or interest on its LIBOR Loans,
         Letters of Credit or participations therein, or any other amounts due
         under this Agreement related to its LIBOR Loans, Letters of Credit,
         Reimbursement Obligations or participations therein, or its obligation
         to make LIBOR Loans, issue Letters of Credit or acquire participations
         therein (except for changes in the rate of tax on the overall net
         income of such Lender or its Lending Office imposed by the jurisdiction
         in which such Lender's principal executive office or Lending Office is
         located); or

                           (ii)     imposes, modifies or deems applicable any
         reserve, special deposit or similar requirement (including, without
         limitation, any such requirement imposed by the Board of Governors of
         the Federal Reserve System) against assets of, deposits with or for the
         account of, or credit extended by, any Lender of that type (or its
         Lending Office) or imposes on any Lender of that type (or its Lending
         Office) or on the interbank market any other condition affecting its
         LIBOR Loans, its Letters of Credit, any Reimbursement Obligation owed
         to it or its participation in any thereof, or its obligation to advance
         or maintain LIBOR Loans, issue Letters of Credit or to participate in
         any thereof;

and the result of any of the foregoing is to increase the cost to such Lender
(or its Lending Office) of advancing or maintaining any LIBOR Loan, issuing or
maintaining a Letter of Credit or participation therein, or to reduce the amount
of any sum received or receivable by such Lender (or its Lending Office) in
connection therewith under this Agreement or its Note(s), by an amount deemed by
such Lender to be material, then, within fifteen (15) days after demand in
reasonable detail by such Lender (with a copy to the Agent), the Borrower shall
be obligated to pay to such Lender such additional amount or amounts as will
compensate such Lender for such increased cost or reduction.

                  (b) If, after the Effective Date, the Agent or any Lender
shall have determined that the adoption after the Effective Date of any
applicable law, rule or regulation regarding capital adequacy, or any change
therein (including, without limitation, any revision in the Final Risk-Based
Capital Guidelines of the Board of Governors of the Federal Reserve System (12
CFR Part 208, Appendix A; 12 CFR Part 225, Appendix A) or of the Office of the
Comptroller of the Currency (12 CFR Part 3, Appendix A), or in any other
applicable capital adequacy rules heretofore adopted and issued by any
governmental authority), or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by the Agent or
any Lender (or its Lending Office) with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on such Lender's capital, or on the capital of any corporation
controlling such Lender, as a consequence of its

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<PAGE>

obligations hereunder to a level below that which such Lender could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender's policies with respect to capital adequacy) by an amount deemed by
such Lender to be material, then from time to time, within fifteen (15) days
after demand in reasonable detail by such Lender (with a copy to the Agent), the
Borrower shall pay to such Lender such additional amount or amounts as will
compensate such Lender for such reduction.

                  (c) The Agent and each Lender that determines to seek
compensation under this SECTION 8.3 shall notify the Borrower and, in the case
of a Lender other than the Agent, the Agent of the circumstances that entitle
the Agent or Lender to such compensation and will designate a different Lending
Office if such designation will avoid the need for, or reduce the amount of,
such compensation and will not, in the sole judgment of such Lender, be
otherwise disadvantageous to it; provided that, the foregoing shall not in any
way affect the rights of any Lender or the obligations of the Borrower under
this SECTION 8.3, and provided further that no Lender shall be obligated to make
its LIBOR Loans hereunder at any office located in the United States. A
certificate of any Lender claiming compensation under this SECTION 8.3 and
setting forth the additional amount or amounts to be paid to it hereunder shall
be conclusive in the absence of manifest error and shall be deemed to contain a
representation by the Lender issuing such certificate that: (i) such Lender has
used, in its sole judgment, reasonable efforts to minimize said compensation,
and (ii) the increased costs and charges are common to substantially all of the
comparable or similarly situated loan customers of such Lender and are not
unique to the Borrower. In determining such amount, such Lender may use any
reasonable averaging and attribution methods.

         Section 8.4 Lending Offices. The Agent and each Lender may, at its
option, elect to make its Loans hereunder at the Lending Office for each type of
Loan available hereunder or at such other of its branches, offices or Affiliates
as it may from time to time elect and designate in a written notice to the
Borrower and the Agent subject to SECTION 8.3(c).

         Section 8.5 Discretion of Lender as to Manner of Funding.
Notwithstanding any other provision of this Agreement, each Lender shall be
entitled to fund and maintain its funding of all or any part of its Loans in any
manner it sees fit, it being understood, however, that for the purposes of this
Agreement all determinations hereunder shall be made as if each Lender had
actually funded and maintained each LIBOR Loan through the purchase of deposits
in the Eurodollar interbank market having a maturity corresponding to such
Loan's Interest Period and bearing an interest rate equal to LIBOR for such
Interest Period.

         Section 8.6 Substitution of Lender. If (i) any Lender has demanded
compensation or given notice of its intention to demand compensation under
SECTION 8.3, or (ii) the Borrower is required to pay any additional amount to
any Lender under SECTION 2.12, the Borrower shall have the right, with the
assistance of the Agent, to seek a substitute lender or lenders reasonably
satisfactory to the Agent (which may be one or more of the Lenders) to replace
such Lender under this Agreement. The Lender to be so replaced shall cooperate
with the Borrower and substitute lender to accomplish such substitution on the
terms of SECTION 10.10, as applicable; provided that all the L/C Commitments of
such Lender are replaced and such Lender is paid any amounts which it is owed
pursuant to SECTIONS 2.12, 3.3, 7.6, 8.3 and 10.3. Any such replaced Lender
shall retain the benefits of SECTIONS 3.3 and 10.13.

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<PAGE>

SECTION 9. THE AGENT.

         Section 9.1 Appointment and Authorization. Each Lender hereby appoints
Bank of America, N.A. as the Agent under the Credit Documents and hereby
authorizes the Agent to take such action as Agent on each of its behalf and to
exercise such powers under the Credit Documents as are delegated to the Agent,
by the terms thereof, together with such powers as are reasonably incidental
thereto.

         Section 9.2 Rights and Powers. The Agent shall have the same rights and
powers under the Credit Documents as any other Lender and may exercise or
refrain from exercising such rights and powers as though it were not an Agent,
and the Agent and its respective Affiliates may accept deposits from, lend money
to, and generally engage in any kind of business with the Borrower or any of its
Subsidiaries or Affiliates as if it were not an Agent under the Credit
Documents. The term Lender as used in all Credit Documents, unless the context
otherwise clearly requires, includes the Agent in its individual capacity as a
Lender.

         Section 9.3 Action by Agent. The obligations of the Agent under the
Credit Documents are only those expressly set forth therein. Without limiting
the generality of the foregoing, the Agent shall not be required to take any
action concerning any Default or Event of Default, except as expressly provided
in SECTIONS 7.2 and 7.5. Unless and until the Majority Lenders give such
direction the Agent may, except as otherwise expressly provided herein or
therein, take or refrain from taking such actions as it deems appropriate and in
the best interest of all the Lenders. In no event, however, shall the Agent be
required to take any action in violation of applicable law or of any provision
of any Credit Document, and the Agent shall in all cases be fully justified in
failing or refusing to act hereunder or under any other Credit Document unless
it first receives any further assurances of its indemnification from the Lenders
that it may require, including prepayment of any related expenses and any other
protection it requires against any and all costs, expenses, and liabilities it
may incur in taking or continuing to take any such action. The Agent shall be
entitled to assume that no Default or Event of Default exists unless notified in
writing to the contrary by a Lender or the Borrower. In all cases in which the
Credit Documents do not require the Agent to take specific action, the Agent
shall be fully justified in using its discretion in failing to take or in taking
any action thereunder. Any instructions of the Majority Lenders, or of any other
group of Lenders called for under specific provisions of the Credit Documents,
shall be binding on all the Lenders and holders of Notes.

         Section 9.4 Consultation with Experts. The Agent may consult with legal
counsel, independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken by it in good
faith in accordance with the advice of such counsel, accountants or experts.

         Section 9.5 Indemnification Provisions; Credit Decision. Neither the
Agent nor any of its directors, officers, agents, Affiliates, or employees shall
be liable for any action taken or not taken by them in connection with the
Credit Documents (i) with the consent or at the request of the Majority Lenders
or all the Lenders where unanimity is required or (ii) in the absence of their
own gross negligence or willful misconduct. Neither the Agent nor any of its
directors, officers, agents or employees shall be responsible for or have any
duty to ascertain, inquire into or verify (i) any statement, warranty or
representation made in connection with this Agreement, any other Credit Document
or any Loan or Letter of Credit; (ii) the performance or observance of

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<PAGE>

any of the covenants or agreements of the Borrower or any Subsidiary contained
herein or in any other Credit Document; (iii) the satisfaction of any condition
specified in SECTION 4, except receipt of items required to be delivered to the
Agent; or (iv) the validity, effectiveness, genuineness, enforceability,
perfection, value, worth or collectibility hereof or of any other Credit
Document or of any other documents or writing furnished in connection with any
Credit Document or of any Collateral; and the Agent makes no representation of
any kind or character with respect to any such matters mentioned in this
sentence. The Agent may execute any of its duties under any of the Credit
Documents by or through employees, agents, Affiliates, and attorneys-in-fact and
shall not be answerable to the Lenders or any other Person for the default or
misconduct of any such agents or attorneys-in-fact selected with reasonable
care. The Agent shall not incur any liability by acting in reliance upon any
notice, consent, certificate, other document or statement (whether written or
oral) believed by it to be genuine or to be sent by the proper party or parties.
In particular and without limiting any of the foregoing, the Agent shall have no
responsibility for confirming the existence or worth of any Collateral or the
accuracy of any Compliance Certificate or other document or instrument received
by it under the Credit Documents. The Agent may treat the payee of any Note as
the holder thereof until written notice of transfer shall have been filed with
such Agent signed by such owner in form satisfactory to such Agent. Each Lender
acknowledges that it has independently and without reliance on the Agent or any
other Lender obtained such information and made such investigations and
inquiries regarding the Borrower and its Subsidiaries as it deems appropriate,
and based upon such information, investigations and inquiries, made its own
credit analysis and decision to extend credit to the Borrower in the manner set
forth in the Credit Documents. It shall be the responsibility of each Lender to
keep itself informed about the creditworthiness and business, properties,
assets, liabilities, condition (financial or otherwise) and prospects of the
Borrower and its Subsidiaries, the creditworthiness of all account debtors of
the Borrower and its Subsidiaries, and the Agent shall have no liability
whatsoever to any Lender for such matters. The Agent shall have no duty to
disclose to the Lenders information that is not required by any Credit Document
to be furnished by the Borrower or any Subsidiaries to such Agent at such time,
but is voluntarily furnished to such Agent (either in its respective capacity as
Agent or in its individual capacity).

         Section 9.6 Indemnity. The Lenders shall ratably, in accordance with
their Percentages, indemnify and hold the Agent and its directors, officers,
employees, agents and representatives harmless from and against any liabilities,
losses, costs or expenses suffered or incurred by it or by any security trustee
under any Credit Document or in connection with the transactions contemplated
thereby, regardless of when asserted or arising, except to the extent they are
promptly reimbursed for the same by the Borrower or out of the proceeds of any
Collateral and except to the extent that any event giving rise to a claim was
caused by the gross negligence or willful misconduct of the party seeking to be
indemnified. The obligations of the Lenders under this SECTION 9.6 shall survive
termination of this Agreement.

         Section 9.7 Resignation of Agent and Successor Agent. The Agent may
resign at any time upon at least thirty (30) days' prior written notice to the
Lenders and the Borrower. Upon any such resignation of the Agent, the Majority
Lenders, with the consent of the Borrower, which consent shall not be
unreasonably withheld, shall have the right to appoint a successor Agent. If no
successor Agent shall have been so appointed by the Majority Lenders and shall
have accepted such appointment within thirty (30) days after the retiring
Agent's giving of notice of resignation, then the retiring Agent, may, on behalf
of the Lenders, appoint a successor Agent

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<PAGE>

which shall be any Lender hereunder or any commercial bank organized under the
laws of the United States of America or of any State thereof and having a
combined capital and surplus of at least $250,000,000. Upon the acceptance of
its appointment as the Agent hereunder, such successor Agent shall thereupon
succeed to and become vested with all the rights and duties of the retiring
Agent under the Credit Documents, and the retiring Agent shall be discharged
from its duties and obligations thereunder. After any retiring Agent's
resignation hereunder as Agent, the provisions of this SECTION 9 and all
protective provisions of the other Credit Documents shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Agent.

SECTION 10. MISCELLANEOUS.

         Section 10.1 No Waiver of Rights. No delay or failure on the part of
the Agent or any of the Lenders, or on the part of the holder or holders of the
Notes, in the exercise of any power, right or remedy under any Credit Document
shall operate as a waiver thereof or as an acquiescence in any default, nor
shall any single or partial exercise thereof preclude any other or further
exercise of any other power, right or remedy. To the fullest extent permitted by
applicable law, the powers, rights and remedies under the Credit Documents of
the Lenders and the holder or holders of the Notes are cumulative to, and not
exclusive of, any rights or remedies any of them would otherwise have.

         Section 10.2 Non-Business Day. Subject to SECTION 2.5(b), if any
payment of principal or interest on any Loan, Reimbursement Obligation or of any
other Obligation shall fall due on a day which is not a Business Day, interest
or fees (as applicable) at the rate, if any, for such Loan, such Reimbursement
Obligation or such other Obligation bears for the period prior to maturity shall
continue to accrue in the manner set forth herein on such Obligation from the
stated due date thereof to and including the next succeeding Business Day on
which the same shall be payable.

         Section 10.3 Documentary Taxes. The Borrower agrees that it will pay
any documentary, stamp or similar taxes payable with respect to any Credit
Document, including interest and penalties, in the event any such taxes are
assessed irrespective of when such assessment is made and regardless whether any
credit is then in use or available hereunder.

         Section 10.4 Survival of Representations. All representations and
warranties made herein or in certificates given pursuant hereto shall survive
the execution and delivery of this Agreement and the other Credit Documents, and
shall continue in full force and effect with respect to the date as of which
they were made as long as the Borrower has any Obligation hereunder or any L/C
Commitment hereunder is in effect.

         Section 10.5 Survival of Indemnities. All indemnities and all other
provisions relative to reimbursement to the Agent and the Lenders of amounts
sufficient to protect the yield of the Lenders or the Agent with respect to the
Loans shall survive the termination of this Agreement and the other Credit
Documents and the payment of the Loans and all other Obligations, as applicable,
for a period of one (1) year.

         Section 10.6 Setoff. In addition to any rights now or hereafter granted
under applicable law and not by way of limitation of any such rights, upon the
occurrence of, and throughout the continuance of, any Default or Event of
Default, the Agent and each of the Lenders and each

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<PAGE>

subsequent holder of any of the Notes is hereby authorized by the Borrower at
any time or from time to time, without notice to the Borrower, to any Subsidiary
of the Borrower or to any other Person, any such notice being hereby expressly
waived, to set off and to appropriate and to apply any and all deposits (general
or special, including, but not limited to, Indebtedness evidenced by
certificates of deposit, whether matured or unmatured, but not including trust
accounts, and in whatever currency denominated) and any other Indebtedness at
any time held or owing by the Agent or the Lenders or that subsequent holder to
or for the credit or the account of the Borrower, whether or not matured,
against and on account of the obligations and liabilities of the Borrower to the
Agent or the Lenders or that subsequent holder under the Credit Documents,
including, but not limited to, all claims of any nature or description arising
out of or connected with the Credit Documents, irrespective of whether or not
(i) the Agent or any of the Lenders or that subsequent holder shall have made
any demand hereunder or (ii) the principal of or the interest on the Loans, the
Notes and other amounts due hereunder shall have become due and payable
hereunder and although said obligations and liabilities, or any of them, may be
contingent or unmatured. The Agent or such Lender, as applicable, shall promptly
give the Borrower notice of any such setoff, provided that any failure to give
such notice shall not impact the validity of any such setoff or give rise to any
liability of the Agent or any Lender as a result of any such failure. The Agent
and the Lenders agree, if there shall be any other Lenders pursuant to SECTION
10.10(b), that if a Lender receives and retains any payment, whether by setoff
or application of deposit balances or otherwise, on any of the Loans or L/C
Obligations in excess of its ratable share of payments on all such Obligations
then owed to the Lenders hereunder, then such Lender shall purchase for cash at
face value, but without recourse, ratably from each of the other Lenders such
amount of the Loans or L/C Obligations, or participations therein, held by such
Lender (or interest therein) as shall be necessary to cause such Lender to share
such excess payment ratably with all the other Lenders; provided, however, that
if any such purchase is made by any Lender, and if such excess payment or part
thereof is thereafter recovered from such purchasing Lender, the related
purchases from the other Lenders shall be rescinded ratably and the purchase
price restored as to the portion of such excess payment so recovered, with
interest pro rata, to the extent the purchasing Lender is required to pay
interest on the amount restored.

         Section 10.7 Notices. Except as otherwise specified herein, all notices
under the Credit Documents shall be in writing (including cable, telecopy or
telex) and shall be given to a party hereunder at its address, telecopier number
or telex numbers set forth below or such other address, telecopier number or
telex as such party may hereafter specify by notice to the Lenders or the
Borrower, as applicable, given by courier, by United States certified or
registered mail, by telegram or by other telecommunication device capable of
creating a written record of such notice and its receipt. Notices under the
Credit Documents shall be addressed to the Agent and the Lenders as set forth on
the signature pages hereto and to the Borrower as follows:

                Quanta Services, Inc.
                1360 Post Oak Blvd., Suite 2100
                Houston, Texas 77056
                Attention:  Mr. James Haddox
                Telephone: (713) 629-7600
                Fax No.:  (713) 629-7676

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<PAGE>

                with a copy to

                Quanta Services, Inc.
                1360 Post Oak Blvd., Suite 2100
                Houston, Texas  77056
                Attention: General Counsel
                Telephone:  (713) 629-7600
                Fax No.:  (713) 629-7676

         Each such notice, request or other communication shall be effective (i)
if given by telecopier, when such telecopy is transmitted to the telecopier
number specified in this SECTION 10.7 and a confirmation of receipt of such
telecopy has been received by the sender, (ii) if given by telex, when such
telex is transmitted to the telex number specified in this SECTION 10.7 and the
answer back is received by sender, (iii) if given by courier, when delivered,
(iv) if given by mail, five (5) days after such communication is deposited in
the mail, registered with return receipt requested, addressed as aforesaid or
(v) if given by any other means, when delivered at the addresses specified in
this SECTION 10.7; provided that any notice given pursuant to SECTION 2 shall be
effective only upon receipt and, provided further, that any notice that but for
this provision would be effective after the close of business on a Business Day
or on a day that is not a Business Day shall be effective at the opening of
business on the next Business Day.

         Section 10.8 Counterparts. This Agreement may be executed in any number
of counterparts, and by the different parties on different counterpart signature
pages, each of which when executed shall be deemed an original but all such
counterparts taken together shall constitute one and the same Agreement.
Telecopies of signatures shall be binding and effective as originals.

         Section 10.9 Successors and Assigns. This Agreement shall be binding
upon the Borrower, the Agent, the Lenders and their respective successors and
assigns, and shall inure to the benefit of the Borrower, the Agent, the Lenders
and their respective successors and assigns, including any subsequent holder of
the Notes. The Borrower may not assign any of its rights or obligations under
any Credit Document without the consent of the Agent and all of the Lenders.

         Section 10.10 Sales and Transfers of Loans and Notes; Participations in
Loans and Notes.

                  (a) Any Lender may at any time sell to one or more banks or
other financial institutions having a combined capital and surplus of at least
$250,000,000 ("PARTICIPANTS"), participating interests in any Loan owing to such
Lender, any Note held by such Lender, any L/C Commitment of such Lender or any
other interest of such Lender hereunder, provided that no Lender may sell any
participating interests in any such Loan, Note, L/C Commitment or other interest
hereunder without also selling to such Participant the appropriate pro rata
share of its Loans, Notes, L/C Commitments and other interests hereunder, and
provided further that no Lender shall transfer, grant or assign any
participation under which the Participant shall have rights to vote upon or
consent to any matter to be decided by the Lender or the Majority Lenders
hereunder or under any Credit Document or approve any amendment to or waiver of
this Agreement or any other Credit Document except to the extent such amendment
or waiver would (i) increase the amount of such Lender's L/C Commitment and such
increase would affect such

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<PAGE>

Participant, (ii) reduce the principal of, or interest on, any of such Lender's
Loans, or any fees or other amounts payable to such Lender hereunder and such
reduction would affect such Participant, (iii) postpone any date fixed for any
scheduled payment of principal of, or interest on, any of such Lender's Loans,
or any fees or other amounts payable to such Lender hereunder, or (iv) release
any collateral for any Obligation (including, without limitation, any Subsidiary
Guaranty), except as otherwise specifically provided in any Credit Document. In
the event of any such sale by a Lender of participating interests to a
Participant, such Lender's obligations under this Agreement to the other parties
to this Agreement shall remain unchanged, such Lender shall remain solely
responsible for the performance thereof, such Lender shall remain the holder of
any such Note for all purposes under this Agreement and the Borrower and the
Agent shall continue to deal solely and directly with such Lender in connection
with such Lender's rights and obligations under this Agreement. The Borrower
agrees that if amounts outstanding under this Agreement and the Notes are due
and unpaid, or shall have been declared or shall have become due and payable
upon the occurrence of an Event of Default, each Participant shall be deemed to
have the right of setoff in respect of its participating interest in amounts
owing under this Agreement and any Note to the same extent as if the amount of
its participating interest were owing directly to it as a Lender under this
Agreement or any Note, provided that such right of setoff shall be subject to
the obligation of such Participant to share with the Lenders, and the Lenders
agree to share with such Participant, as provided in SECTION 10.6. The Borrower
also agrees that each Participant shall be entitled to the benefits of SECTIONS
2.12 and 8.3 with respect to its participation in the L/C Commitments and the
Loans outstanding from time to time, provided that no Participant shall be
entitled to receive any greater amount pursuant to such Sections than the
transferor Lender would have been entitled to receive in respect of the amount
of the participation transferred.

                  (b) Any Lender may at any time sell to any Lender or any
Affiliate thereof, and, with the consent of the Agent and the Borrower (which
shall not be unreasonably withheld or delayed), to one or more banks or other
financial institutions having a combined capital and surplus of at least
$250,000,000 (a "PURCHASING LENDER"), all or any part of its rights and
obligations under this Agreement and the Notes, pursuant to an Assignment
Agreement in the form attached as EXHIBIT 10.10 hereto, executed by such
Purchasing Lender and such transferor Lender (and, in the case of a Purchasing
Lender which is not then a Lender or an Affiliate thereof, by the Borrower and
the Agent) and delivered to the Agent; provided that, (i) each such sale to a
Purchasing Lender is for an identical percentage of the transferor Lender's
rights and obligations under the Term Loan and the L/C Commitment, and (ii) each
such sale to a Purchasing Lender shall be in an amount of $5,000,000 or more, or
if in a lesser amount, such sale shall be of all of the Lender's rights and
obligations under this Agreement and all of the Notes payable to it to one
eligible assignee. Notwithstanding the above, any Lender may sell to one or more
eligible assignees all or any part of their rights and obligations under this
Agreement and the Notes with only the consent of the Agent (which shall not be
unreasonably withheld) if an Event of Default shall have occurred and be
continuing. No Lender may sell any Loans to a Purchasing Lender without also
selling to such Purchasing Lender the appropriate pro rata share of its Notes,
L/C Commitments and other interests hereunder, including participations in
Letters of Credit hereunder. Upon such execution, delivery, acceptance and
recording, from and after the effective date of the transfer determined pursuant
to such Assignment Agreement (x) the Purchasing Lender thereunder shall be a
party hereto and, to the extent provided in such Assignment Agreement, have the
rights and obligations of a Lender hereunder with an L/C Commitment as set forth
therein and (y) the transferor Lender thereunder shall, to the extent

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<PAGE>

provided in such Assignment Agreement, be released from its obligations under
this Agreement (and, in the case of an Assignment Agreement covering all or the
remaining portion of a transferor Lender's rights and obligations under this
Agreement, such transferor Lender shall cease to be a party hereto). Such
Assignment Agreement shall be deemed to amend this Agreement to the extent, and
only to the extent, necessary to reflect the addition of such Purchasing Lender
and the resulting adjustment of L/C Commitments and Percentages arising from the
purchase by such Purchasing Lender of all or a portion of the rights and
obligations of such transferor Lender under this Agreement, the Notes and the
other Credit Documents. On or prior to the effective date of the transfer
determined pursuant to such Assignment Agreement, the Borrower, at its own
expense, shall execute and deliver to the Agent in exchange for any surrendered
Notes, new Notes as appropriate to the order of such Purchasing Lender in an
amount equal to the Loans assumed by it pursuant to such Assignment Agreement,
and, if the transferor Lender has retained a Loan hereunder, new Notes to the
order of the transferor Lender in an amount equal to the Loans retained by it
hereunder. Such new Notes shall be dated the Initial Borrowing Date and shall
otherwise be in the form of the Notes replaced thereby. The Notes surrendered by
the transferor Lender shall be returned by the Agent to the Borrower marked
"cancelled."

                  (c) Upon its receipt of an Assignment Agreement executed by a
transferor Lender, a Purchasing Lender and the Agent (and, in the case of a
Purchasing Lender that is not then a Lender or an Affiliate thereof, by the
Borrower), together with payment to the Agent hereunder of a registration and
processing fee of $3,500, the Agent shall (i) promptly accept such Assignment
Agreement, and (ii) on the effective date of the transfer determined pursuant
thereto give notice of such acceptance and recordation to the Lenders and the
Borrower.

                  (d) The provisions of the foregoing clauses (b) and (c) shall
not apply to or restrict, or require the consent of or any notice to any Person
to effectuate, the pledge or assignment by any Lender of its rights under this
Agreement and its Notes to any Federal Reserve Bank.

                  (e) If, pursuant to this SECTION 10.10 any interest in this
Agreement or any Note is transferred to any transferee which is organized under
the laws of any jurisdiction other than the United States of America or any
State thereof, the transferor Lender shall cause such transferee, concurrently
with the effectiveness of such transfer, (i) to represent to the transferor
Lender (for the benefit of the transferor Lender, the Agent and the Borrower)
that under applicable law and treaties no taxes will be required to be withheld
by the Agent, the Borrower or the transferor Lender with respect to any payments
to be made to such transferee in respect of the Loans or the L/C Obligations,
(ii) to furnish to the transferor Lender (and, in the case of any Purchasing
Lender, the Agent and the Borrower) either U.S. Internal Revenue Service Form
4224 or U.S. Internal Revenue Service Form 1001 or such successor forms as shall
be adopted from time to time by the relevant United States taxing authorities
(wherein such transferee claims entitlement to complete exemption from U.S.
federal withholding tax on all interest payments hereunder), and (iii) to agree
(for the benefit of the transferor Lender, the Agent and the Borrower) to
provide the transferor Lender (and, in the case of any Purchasing Lender, the
Agent and the Borrower) a new Form 4224 or Form 1001, or any successor forms
thereto, upon the expiration or obsolescence of any previously delivered form
and comparable statements in accordance with applicable U.S. laws and
regulations and amendments dully executed and completed by such

                                       57

<PAGE>

transferee, and to comply from time to time with all applicable U.S. laws and
regulations with regard to such withholding tax exemption.

         Section 10.11 Amendments. Any provision of the Credit Documents may be
amended or waived if, but only if, such amendment or waiver is in writing and is
signed by (a) the Borrower, (b) the Majority Lenders (in the case of a consent
or waiver, the Borrower may rely on the consent or waiver of the Agent on behalf
of the Majority Lenders, the Agent agreeing to obtain the necessary consents or
waivers from the Majority Lenders before providing such consent or waiver), and
(c) if the rights or duties of the Agent are affected thereby, the Agent;
provided that:

                           (i)      no amendment or waiver shall (A) increase
         the L/C Commitment Amount without the consent of all Lenders or
         increase any L/C Commitment of any Lender without the consent of such
         Lender, (B) postpone the Maturity Date without the consent of all
         Lenders or reduce the amount of or postpone the date for any scheduled
         payment of any principal of or interest on any Loan, Reimbursement
         Obligation or of any fee or any other amounts payable hereunder without
         the consent of each Lender owed such Obligation or (C) release any
         Subsidiary Guaranty or any Collateral without the consent of all the
         Lenders and the Agent; and

                           (ii)     no amendment or waiver shall, unless signed
         by each Lender, change the provisions of this SECTION 10.11 or the
         definition of Majority Lenders or affect the number of Lenders required
         to take any action under any other provision of the Credit Documents.

         Section 10.12 Headings. Section headings used in this Agreement are for
reference only and shall not affect the construction of this Agreement.

         Section 10.13 Legal Fees, Other Costs and Indemnification. The
Borrower, upon demand by the Agent or any Lender, agrees to pay the reasonable
fees and disbursements of legal counsel and financial advisors to the Agent or
any Lender in connection with (a) the preparation and execution of the Credit
Documents, any amendment, waiver or consent related thereto, whether or not the
transactions contemplated therein are consummated, (b) any Default or Event of
Default by the Borrower hereunder and any enforcement (including, without
limitation, all workout and bankruptcy proceedings) of any of the Credit
Documents or collection of any Obligations, and (c) any refinancings,
restructures or "work out" of the transactions contemplated by the Credit
Documents; provided that the Borrower shall only have to pay the reasonable fees
and disbursements of one law firm and one financial advisory firm in connection
therewith unless the Agent, any Lender or their counsel is of the reasonable
opinion that representation by one law firm or one financial advisory firm, as
applicable, would not be feasible or that a conflict of interest would exist.
The Borrower further agrees to indemnify the Agent and each Lender and its
respective directors, officers, shareholders, employees and attorneys
(collectively, the "INDEMNIFIED PARTIES"), against all losses, claims, damages,
penalties, judgments, liabilities and expenses (including, without limitation,
all reasonable attorneys' fees and other reasonable expenses of litigation or
preparation therefor, whether or not the Indemnified Party is a party thereto)
which any of them may pay or incur arising out of or relating to (a) any Credit
Document, the Loans, the Letters of Credit or the application or proposed
application by the Borrower of the proceeds of any Loan, REGARDLESS OF

                                       58

<PAGE>

WHETHER SUCH CLAIMS OR ACTIONS ARE FOUNDED IN WHOLE OR IN PART UPON THE ALLEGED
SIMPLE OR CONTRIBUTORY NEGLIGENCE OF ANY OF THE INDEMNIFIED PARTIES AND/OR ANY
OF THEIR RESPECTIVE DIRECTORS, OFFICERS, SHAREHOLDERS, EMPLOYEES OR ATTORNEYS,
(b) any investigation of any third party or any governmental authority involving
the Agent or any Lender and related to any use made or proposed to be made by
the Borrower of the proceeds of the Loans, or any transaction financed or to be
financed in whole or in part, directly or indirectly with the proceeds of any
Loan, and (c) any investigation of any third party or any governmental
authority, litigation or proceeding, related to any environmental cleanup,
audit, compliance or other matter relating to any Environmental Law or the
presence of any Hazardous Material (including, without limitation, any losses,
liabilities, damages, injuries, costs, expenses or claims asserted or arising
under any Environmental Law) with respect to the Borrower or any of its
Subsidiaries, regardless of whether caused by, or within the control of, the
Borrower or any of its Subsidiaries; provided, however, that the Borrower shall
not be obligated to indemnify any Indemnified Party for any of the foregoing
arising out of (i) such Indemnified Party's gross negligence or willful
misconduct, (ii) the Agent's failure to pay under any Letter of Credit after the
presentation to it of a request required to be paid under applicable law, (iii)
the Agent's or any Lender's breach of any material provision of any Credit
Document, or any dispute solely among the Agent and the Lenders or any of same.
The Borrower, upon demand by the Indemnified Party at any time, shall reimburse
the Indemnified Party for any legal or other expenses incurred in connection
with investigating or defending against any of the foregoing except if the same
is excluded from indemnification pursuant to the provisions of the foregoing
sentence.

         Section 10.14 Governing Law; Submission to Jurisdiction; Waiver of Jury
Trial.


                  (a) The Credit Agreement, and the other Credit Documents, and
the rights and duties of the parties thereto, shall be construed in accordance
with and governed by the internal laws of the State of Texas.

                  (b) THE AGENT, EACH LENDER AND THE BORROWER HEREBY WAIVES ITS
RIGHT TO RESOLVE DISPUTES, CLAIMS, AND CONTROVERSIES ARISING FROM THE CREDIT
AGREEMENT, ANY OTHER CREDIT DOCUMENT OR ANY MATTER IN CONNECTION THEREWITH,
INCLUDING, WITHOUT LIMITATION, CONTRACT DISPUTES AND TORT CLAIMS, THROUGH ANY
COURT PROCEEDING OR LITIGATION AND ACKNOWLEDGES THAT ALL SUCH DISPUTES, CLAIMS
AND CONTROVERSIES SHALL BE RESOLVED PURSUANT TO THIS SECTION, EXCEPT THAT
EQUITABLE RELIEF AND CERTAIN OTHER RIGHTS AND REMEDIES SET FORTH BELOW MAY BE
SOUGHT FROM ANY COURT OF COMPETENT JURISDICTION. EACH PARTY REPRESENTS TO THE
OTHER PARTIES THAT THIS WAIVER IS MADE KNOWINGLY AND VOLUNTARILY AFTER
CONSULTATION WITH AND UPON ADVICE OF ITS COUNSEL AND IS A MATERIAL PART OF THIS
AGREEMENT. ALL SUCH DISPUTES, CLAIMS AND CONTROVERSIES SHALL BE RESOLVED BY
BINDING ARBITRATION PURSUANT TO THE COMMERCIAL RULES OF THE AMERICAN ARBITRATION
ASSOCIATION ("AAA"). Any arbitration proceeding held pursuant to this
arbitration provision shall be conducted in Houston, Texas or at any other place
selected by mutual agreement of the parties. No act to take or dispose of any
collateral shall constitute a waiver of this arbitration agreement or be
prohibited by this arbitration agreement. This

                                       59

<PAGE>

arbitration provision shall not limit the right of any party during any dispute,
claim or controversy to seek, use, and employ ancillary, or preliminary rights
and/or remedies, judicial or otherwise, for the purposes of realizing upon,
preserving, protecting, foreclosing upon or proceeding under forcible entry and
detainer for possession of, any real or personal property, and any such action
shall not be deemed an election of remedies. Such remedies include, without
limitation, obtaining injunctive relief or a temporary restraining order,
invoking a power of sale under any deed of trust or mortgage, obtaining a writ
of attachment or imposition of a receivership, or exercising any rights relating
to personal property, including exercising the right of set-off, or taking or
disposing of such property with or without judicial process pursuant to the
Uniform Commercial Code. Any disputes, claims or controversies concerning the
lawfulness or reasonableness of an act, or exercise of any right or remedy
concerning any collateral, including any claim to rescind, reform, or otherwise
modify any agreement relating to the collateral, shall also be arbitrated;
provided, however that no arbitrator shall have the right or the power to enjoin
or restrain any act of either party. Judgment upon any award rendered by any
arbitrator may be entered in any court having jurisdiction. The statute of
limitations, estoppel, waiver, laches and similar doctrines which would
otherwise be applicable in an action brought by a party shall be applicable in
any arbitration proceeding, and the commencement of an arbitration proceeding
shall be deemed the commencement of any action for these purposes. The federal
arbitration act (Title 9 of the United States Code) shall apply to the
construction, interpretation, and enforcement of this arbitration provision.

                  (c) To the fullest extent permitted by applicable law, each
party hereto agrees that any court proceeding or litigation permitted by SECTION
10.14(b) may be brought and maintained in the courts of the State of Texas
sitting in Harris County or the United States District Court for the Southern
District of Texas. To the fullest extent permitted by applicable law, the
Borrower hereby expressly and irrevocably submits to the jurisdiction of the
courts of the State of Texas and the United States District Court for the
Southern District of Texas for the purpose of any such litigation as set forth
above and irrevocably agrees to be bound by any judgment rendered thereby in
connection with such litigation. To the fullest extent permitted by applicable
law, the Borrower further irrevocably consents to the service of process, by
registered mail, postage prepaid, or by personal service within or without the
state of Texas. To the fullest extent permitted by applicable law, the Borrower
hereby expressly and irrevocably waives any objection which it may have or
hereafter may have to the laying of venue of any such litigation brought in any
such court referred to above and any claim that any such litigation has been
brought in an inconvenient forum. To the extent that the Borrower has or
hereafter may acquire any immunity from jurisdiction of any court or from any
legal process (whether through service of notice, attachment prior to judgment,
attachment in aid of execution or otherwise) with respect to itself or its
property, the Borrower hereby irrevocably waives to the fullest extent permitted
by applicable law, such immunity in respect of its obligations under the Credit
Agreement and the other Credit Documents.

                  (d) TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH
PARTY TO THIS AGREEMENT VOLUNTARILY, KNOWINGLY, IRREVOCABLY AND UNCONDITIONALLY
(BY ITS ACCEPTANCE OF THIS AGREEMENT) WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING PERMITTED BY SECTION 10.14(B) AND WAIVES ANY RIGHT TO HAVE
A JURY PARTICIPATE IN RESOLVING ANY DISPUTE (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF THE CREDIT

                                       60

<PAGE>

AGREEMENT, ANY OTHER CREDIT DOCUMENT, ANY OTHER RELATED DOCUMENT OR ANY
RELATIONSHIP BETWEEN THE AGENT, ANY LENDER, THE BORROWER AND/OR ANY GUARANTOR,
AND AGREES THAT ANY SUCH ACTION, PROCEEDING OR DISPUTE SHALL BE TRIED BEFORE A
COURT AND NOT BEFORE A JURY. THIS PROVISION IS A MATERIAL INDUCEMENT TO THE
LENDERS TO PROVIDE THE LOANS AND THE LETTERS OF CREDIT.

         Section 10.15 Confidentiality. The Agent and each Lender (each a
"RESTRICTED PARTY", and collectively, the "RESTRICTED PARTIES") agrees it will
not disclose without the Borrower's consent (other than to its employees,
contract employees, auditors, counsel or other professional advisors or to its
Affiliates) any information concerning the Borrower or any of its Subsidiaries
furnished to the Restricted Parties pursuant to any of the Credit Documents,
including, but not limited to, information which is marked or otherwise
designated as "confidential" by Borrower or any of its Subsidiaries; provided
that any Restricted Party may disclose any information (i) to any other
Restricted Party or its Affiliates or to the employees, contract employees,
auditors, counsel or other professional advisors of any other Restricted Party
or its Affiliates, (ii) that has become generally available to the public, other
than by the Restricted Party making such disclosure, (iii) that was previously
known to a Restricted Party, (iv) becomes known or available to a Restricted
Party from a source other than the Borrower or any of its Subsidiaries, (v) if
required or appropriate in any examination or audit or any report, statement or
testimony submitted to any federal or state regulatory body having or claiming
to have jurisdiction over such Restricted Party, (vi) if required or appropriate
in response to any summons or subpoena or in connection with any litigation,
(vii) in order to comply with any law, order, regulation or ruling applicable to
such Restricted Party, (viii) to any prospective or actual permitted transferee
in connection with any contemplated or actual permitted transfer of any interest
in any Note by any Lender subject to the terms of this Agreement, (ix) in
connection with the exercise of any remedies by any Restricted Party, and (x)
disclosed publicly by Borrower or any of its Subsidiaries.

         Section 10.16 Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

         Section 10.17 Change in Accounting Principles or Tax Laws. If (i) any
change in accounting principles from those used in the preparation of the
financial statements of the Borrower referred to in SECTION 5.9 is hereafter
occasioned by the promulgation of rules, regulations, pronouncements and
opinions by or required by the Financial Accounting Standards Board or the
American Institute of Certified Public Accounts (or successors thereto or
agencies with similar functions) and such change materially affects the
calculation of any component of any financial covenant, standard or term found
in this Agreement, or (ii) there is a material change in federal or foreign tax
laws which materially affects the Borrower's ability to comply with the
financial covenants, standards or terms found in this Agreement, the Borrower,
the Agent and the Lenders agree to enter into negotiations in order to amend
such provisions so as to equitably reflect such changes with the desired result
that the criteria for evaluating the Borrower's and its Subsidiaries'
consolidated financial condition shall be the same after such changes as if such
changes had not been made. Unless and until such provisions have been so

                                       61

<PAGE>

amended, the provisions of this Agreement shall govern, provided that, for
purposes of this SECTION 10.17, the Borrower shall have 90 days from the date of
any such change to amend the appropriate provisions of this Agreement to reflect
such change in accordance with the immediately preceding sentence.

         Section 10.18 Refinancing of Senior Notes and Loans Under Existing
Credit Agreement. This Agreement constitutes a refinancing of the Senior Notes
and the "Obligations" under the Existing Credit Agreement. On the date hereof:

                  (a) The Borrower shall pay all accrued and unpaid commitment
fees outstanding under the Existing Credit Agreement;

                  (b) The Senior Notes and each "Swing Line Loan" under the
Existing Credit Agreement shall be deemed to be repaid with the proceeds of the
Term Loan;

                  (c) each Existing L/C outstanding under the Existing Credit
Agreement shall be deemed to have been issued under this Agreement without
payment of any further fronting fee (but subject to the other fees set forth in
SECTION 3.1(a)); and

                  (d) the Existing Credit Agreement and the commitments
thereunder shall terminate.

         Section 10.19 Effectiveness. This Agreement shall become effective on
the date (the "EFFECTIVE DATE") on which the Borrower, the Agent and each Lender
has signed and delivered to the Agent a counterpart signature page hereto or, in
the case of a Lender, the Agent has received telex or facsimile notice that such
a counterpart has been signed and mailed to the Agent.

         Section 10.20 Notice. The Credit Documents constitute the entire
understanding among the Borrower, the Agent and the Lenders and supersede all
earlier or contemporaneous agreements, whether written or oral, concerning the
subject matter of the Credit Documents. THIS WRITTEN AGREEMENT TOGETHER WITH THE
OTHER CREDIT DOCUMENTS REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES.

                                       62

<PAGE>

         IN WITNESS WHEREOF, the parties to this Agreement have caused this
Agreement to be duly executed and delivered by their duly authorized officers as
of the day and year first above written.

                                    BORROWER:

                                    QUANTA SERVICES, INC.

                                    By: /s/ JAMES H. HADDOX
                                       -------------------------------------
                                        James H. Haddox
                                        Chief Financial Officer

              Fourth Amended and Restated Secured Credit Agreement
                                 Signature Page


<PAGE>

                                    LENDERS:

                                    BANK OF AMERICA, N.A.,
                                    as Administrative Agent and as a Lender

                                    By: /s/ GARY L. MINGLE
                                       --------------------------------------
                                        Gary L. Mingle
                                        Senior Vice President

Address for Notices:

Bank of America, N.A.
700 Louisiana St.
Houston, TX 77002
Attention: Gary L. Mingle
Telephone No.: (713) 247-6447
Fax No.: (713) 247-7175

              Fourth Amended and Restated Secured Credit Agreement
                                 Signature Page


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>6
<FILENAME>h10560exv31w1.txt
<DESCRIPTION>CERTIFICATION OF CEO PURSUANT TO SECTION 302
<TEXT>
<PAGE>
                                                                   EXHIBIT 31.1


I, John R. Colson, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of Quanta Services, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

         a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;

         b) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and

         c) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting;
and

5. The registrant's other certifying officer(s) and I have disclosed, based on
our most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):

         a) All significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize and report financial information; and

         b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal control
over financial reporting.


Date:  November 13, 2003               By: /s/ JOHN R. COLSON
                                           ------------------------------------
                                           John R. Colson,
                                           Chairman and Chief Executive Officer


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.2
<SEQUENCE>7
<FILENAME>h10560exv31w2.txt
<DESCRIPTION>CERTIFICATION OF CFO PURSUANT TO SECTION 302
<TEXT>
<PAGE>

                                                                   EXHIBIT 31.2


I, James H. Haddox, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of Quanta Services, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

         a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;

         b) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and

         c) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting;
and

5. The registrant's other certifying officer(s) and I have disclosed, based on
our most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):

         a) All significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize and report financial information; and

         b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal control
over financial reporting.


Date:  November 13, 2003                    By:  /s/ JAMES H. HADDOX
                                                 ------------------------------
                                                 James H. Haddox,
                                                 Chief Financial Officer


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.1
<SEQUENCE>8
<FILENAME>h10560exv32w1.txt
<DESCRIPTION>CERTIFICATION OF CEO & CFO PURSUANT TO SECTION 906
<TEXT>
<PAGE>

                                                                   EXHIBIT 32.1


                                  CERTIFICATION
                       PURSUANT TO 18 U.S.C. SECTION 1350,
           AS ADOPTED BY SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

         Each of the undersigned officers of Quanta Services, Inc. (the
"Company") certify, pursuant to 18 U.S.C. ss. 1350, as adopted by Section 906 of
the Sarbanes-Oxley Act of 2002, to such officer's knowledge that:

         (1) the accompanying Form 10-Q report for the period ending September
30, 2003 as filed with the U.S. Securities and Exchange Commission (the
"Report") fully complies with the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934, as amended; and

         (2) the information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Company.

Dated:  November 13, 2003

                                           /s/ JOHN R. COLSON
                                           ------------------------------------
                                           John R. Colson,
                                           Chief Executive Officer



Dated:  November 13, 2003

                                           /s/ JAMES H. HADDOX
                                           ------------------------------------
                                           James H. Haddox,
                                           Chief Financial Officer

</TEXT>
</DOCUMENT>
</SUBMISSION>
