Exhibit 4-C-13








                          PENNSYLVANIA ELECTRIC COMPANY

                                       AND

                     UNITED STATES TRUST COMPANY OF NEW YORK

                                     TRUSTEE

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


                                    INDENTURE

                            DATED AS OF APRIL 1, 1999






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<PAGE>


CROSS REFERENCE SHEET SHOWING THE LOCATION IN THE INDENTURE
OF THE PROVISIONS INSERTED PURSUANT TO SECTIONS 310
THROUGH 318(a),INCLUSIVE, OF THE TRUST INDENTURE ACT OF 1939

Trust Indenture Act                                                Indenture
Section                                                              Section
310 (a) (1).............................................................7.08
   (a) (2)..............................................................7.07
   (a) (3)....................................................Not Applicable
   (a) (4)....................................................Not Applicable
   (a) (5) .............................................................7.08
   (b)..................................................................7.07
   (c)........................................................Not Applicable

311 (a)................................................................ 7.13
   (b)..................................................................7.13
   (c)........................................................Not Applicable

312 (a).....................................................6.01 and 6.02(a)
   (b)...............................................................6.02(b)
   (c)...............................................................6.02(c)

313 (a)..............................................................6.04(a)
   (b). .............................................................6.04(b)
   (c). .............................................................6.04(d)
   (d)...............................................................6.04(c)

314 (a)........................................................6.03 and 5.05
   (c) (1)....................................................1.03 and 13.05
   (c) (2)....................................................1.03 and 13.05
   (c) (3)....................................................Not Applicable
   (d)..................................................................1.03
   (e)...............................................................13.05(b)
   (f)........................................................Not Applicable

315 (a).................................................................7.01
   (c)...............................................................7.01(a)
   (d)...............................................................7.01(b)
   (e)..................................................................7.09

316 (a) .......................................................7.07 and 8.04
   (b).....................................................7.04(b) and 11.02
   (c)..................................................................8.06

317 (a)(1) ..........................................................7.02(b)
   (a) (2)...........................................................7.02(c)
   (b).........................................................4.02 and 5.04

318 (a)................................................................13.07

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

NOTE: This cross-reference sheet shall not, for any purpose, be deemed
      to be a part of the Indenture.






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                                TABLE OF CONTENTS

                                                                        Page

                                    ARTICLE I

                                   DEFINITIONS

Section 1.01      General ...............................................1
Section 1.02      Trust Indenture Act....................................1
Section 1.03      Definitions............................................2


                                   ARTICLE II

                    FORM, ISSUE, EXECUTION, REGISTRATION AND

                                EXCHANGE OF NOTES

Section 2.01      Form Generally. .......................................9
Section 2.02      Form Of Trustee's Certificate Of Authentication.......10
Section 2.03      Amount Unlimited......................................10
Section 2.04      Denominations, Dates, Interest Payment
                  And Record Dates .....................................10
Section 2.05      Execution, Authentication, Delivery And Dating........11
Section 2.06      Exchange And Registration Of Transfer Of Notes........15
Section 2.07      Mutilated, Destroyed, Lost Or Stolen Notes............16
Section 2.08      Temporary Notes.......................................17
Section 2.09      Cancellation Of Notes Paid, Etc.......................17
Section 2.10      Interest Rights Preserved.............................17
Section 2.11      Special Record Date...................................18
Section 2.12      Payment Of Notes......................................18
Section 2.13      Notes Issuable In The Form Of A Global Note...........19


                                   ARTICLE III

                               REDEMPTION OF NOTES

Section 3.01      Applicability Of Article..............................22
Section 3.02      Notice Of Redemption; Selection Of Notes..............22
Section 3.03      Payment Of Notes On Redemption; Deposit Of
                  Redemption Price......................................23











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<PAGE>


                                   ARTICLE IV

                           SATISFACTION AND DISCHARGE;
                                UNCLAIMED MONEYS

Section 4.01      Satisfaction And Discharge............................25
Section 4.02      Deposited Moneys To Be Held In Trust By Trustee.......27
Section 4.03      Paying Agent To Repay Moneys Held.....................27
Section 4.04      Return Of Unclaimed Moneys............................28


                                    ARTICLE V

                       PARTICULAR COVENANTS OF THE COMPANY

Section 5.01      Payment Of Principal And Interest.....................28
Section 5.02      Offices For Payments, Etc.............................28
Section 5.03      Appointment To Fill A Vacancy In Office
                  Of Trustee............................................29
Section 5.04      Provision As To Paying Agent..........................29
Section 5.05      Certificates And Notice To Trustee....................30
Section 5.06      Restrictions On Liens.................................30
Section 5.07      Restrictions On Sale And Lease-Back
                  Transactions..........................................33
Section 5.08      Corporate Existence...................................33
Section 5.09      Issuance of Additional First Mortgage Bonds...........34


                                   ARTICLE VI

                         NOTEHOLDER LISTS AND REPORTS BY

                           THE COMPANY AND THE TRUSTEE

Section 6.01      Company To Furnish Noteholder Lists...................34
Section 6.02      Preservation and Disclosure of Noteholder Lists.......34
Section 6.03      Reports By The Company................................36
Section 6.04      Reports By The Trustee................................36
















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<PAGE>


                                   ARTICLE VII

                     REMEDIES OF THE TRUSTEE AND NOTEHOLDERS

                              ON EVENTS OF DEFAULT

Section 7.01      Events Of Default.....................................37
Section 7.02      Collection Of Indebtedness By Trustee;
                  Trustee May Prove Debt................................40
Section 7.03      Application Of Proceeds...............................42
Section 7.04      Limitations On Suits By Noteholders...................43
Section 7.05      Suits For Enforcement.................................43
Section 7.06      Powers And Remedies Cumulative; Delay Or
                  Omission Not Waiver Of Default........................44
Section 7.07      Direction of Proceedings and Waiver of
                  Defaults By Majority of Noteholders...................44
Section 7.08      Notice of Default.....................................45
Section 7.09      Undertaking To Pay Costs..............................45
Section 7.10      Restoration of Rights on Abandonment of
                  Proceedings...........................................46
Section 7.11      Waiver of Usury, Stay or Extension Laws...............46


                                  ARTICLE XIII

                             CONCERNING THE TRUSTEE

Section 8.01      Duties and Responsibilities of Trustee................46
Section 8.02      Reliance on Documents, Opinions, Etc..................47
Section 8.03      No Responsibility For Recitals, Etc...................49
Section 8.04      Trustee, Authenticating Agent, Paying
                  Agent Or Registrar May Own Notes......................49
Section 8.05      Moneys To Be Held In Trust............................49
Section 8.06      Compensation And Expenses Of Trustee..................49
Section 8.07      Officers' Certificate As Evidence.....................50
Section 8.08      Conflicting Interest Of Trustee.......................50
Section 8.09      Existence And Eligibility Of Trustee..................50
Section 8.10      Resignation Or Removal Of Trustee.....................51
Section 8.11      Appointment Of Successor Trustee......................52
Section 8.12      Acceptance By Successor Trustee.......................52
Section 8.13      Succession By Merger, Etc.............................53
Section 8.14      Limitations On Rights Of Trustee As A Creditor........54
Section 8.15      Authenticating Agent..................................54











                                        v


<PAGE>


                                   ARTICLE IX

                           CONCERNING THE NOTEHOLDERS

Section 9.01      Action By Noteholders.................................55
Section 9.02      Proof Of Execution By Noteholders.....................55
Section 9.03      Persons Deemed Absolute Owners. ......................55
Section 9.04      Company-Owned Notes Disregarded.......................56
Section 9.05      Revocation Of Consents; Future Holders Bound. ........56
Section 9.06      Record Date For Noteholder Acts.......................56


                                    ARTICLE X

                              NOTEHOLDERS' MEETING

Section 10.01     Purposes Of Meetings..................................57
Section 10.02     Call Of Meetings By Trustee...........................57
Section 10.03     Call Of Meetings By Company Or Noteholders............58
Section 10.04     Qualifications For Voting.. ..........................58
Section 10.05     Regulations...........................................58
Section 10.06     Voting. ..............................................59
Section 10.07     Rights Of Trustee Or Noteholders Not Delayed..........59



                                   ARTICLE XI

               CONSOLIDATION, MERGER, SALE, TRANSFER OR CONVEYANCE

Section 11.01     Company May Consolidate, Etc. Only
                  On Certain Terms......................................60
Section 11.02     Successor Corporation Substituted.....................60


                                   ARTICLE XII

                             SUPPLEMENTAL INDENTURES

Section 12.01     Supplemental Indentures Without

                  Consent Of Noteholders................................61
Section 12.02     Supplemental Indentures With Consent

                  Of Noteholders........................................62
Section 12.03     Compliance With Trust Indenture Act;
                  Effect Of Supplemental Indentures.....................64
Section 12.04     Notation On Notes.....................................64
Section 12.05     Evidence Of Compliance Of Supplemental
                  Indenture To Be Furnished Trustee.....................64





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<PAGE>


                                  ARTICLE XIII

                           IMMUNITY OF INCORPORATORS,
                      STOCKHOLDERS, OFFICERS AND DIRECTORS

Section 13.01     Indenture And Notes Solely Corporate
                  Obligations...........................................64


                                   ARTICLE XIV

                            MISCELLANEOUS PROVISIONS

Section 14.01     Provisions Binding On Company's Successors............65
Section 14.02     Official Acts By Successor Corporation................65
Section 14.03     Notices...............................................65
Section 14.04     Governing Law.........................................65
Section 14.05     Evidence Of Compliance With Conditions
                  Precedent.............................................65
Section 14.06     Business Days.........................................67
Section 14.07     Trust Indenture Act To Control........................67
Section 14.08     Table Of Contents, Headings, Etc......................67
Section 14.09     Execution In Counterparts.............................67
Section 14.10     Manner Of Mailing Notice To Noteholders...............68
Section 14.11     Approval By Trustee Of Expert Or Counsel..............68


EXHIBIT A         - Form of Global Note.................................A-1
EXHIBIT B         - Form of Note........................................B-1












                                       vii


<PAGE>



         THIS  INDENTURE,  dated  as of  April  1,  1999,  between  PENNSYLVANIA
ELECTRIC  COMPANY,  a corporation  duly organized and existing under the laws of
the  Commonwealth  of  Pennsylvania  (the  "COMPANY"),  and UNITED  STATES TRUST
COMPANY OF NEW YORK, as trustee (the "TRUSTEE").

                                   WITNESSETH

         WHEREAS,  for its  lawful  corporate  purposes,  the  Company  has duly
authorized  the  execution  and  delivery of this  Indenture  to provide for the
issuance from time to time of its Notes (as hereinafter  defined),  to be issued
as in this Indenture provided;

         AND WHEREAS,  all acts and things  necessary  to make 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 initial  series of
Notes have in all respects been duly authorized;

                    NOW THEREFORE, THIS INDENTURE WITNESSETH:

         That in order to declare the terms and conditions  upon which the Notes
are, and are to be authenticated,  issued and delivered, and in consideration of
the premises, of the purchase and acceptance of the Notes by the Holders thereof
and of the sum of one dollar duly paid to it by the Trustee at the  execution of
this  Indenture,  the  receipt  whereof  is hereby  acknowledged,  the  Company,
intending to be legally bound hereby,  covenants and agrees with the Trustee for
the equal and proportionate  benefit of the respective Holders from time to time
of the Notes, as follows:

                                    ARTICLE I

                                   DEFINITIONS

         Section 1.01  General.  The terms defined in this Article I (whether or
not capitalized and 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 Article I.

         Section 1.02 Trust Indenture Act. (a) Whenever this Indenture refers to
a provision of the Trust  Indenture Act of 1939 (the "TIA"),  such  provision is
incorporated by reference in and made a part of this Indenture.


<PAGE>


                  (b)  Unless  otherwise  indicated,  all  terms  used  in  this
Indenture  that are  defined  by the TIA,  defined  by the TIA by  reference  to
another statute or defined by a rule of the Commission  under the TIA shall have
the meanings  assigned to them in the TIA or such statute or rule as in force on
the date of execution of this Indenture.

         Section 1.03 Definitions. For purposes of this Indenture, the following
terms shall have the following meanings.

         "Authenticating  Agent" shall mean any agent of the Trustee which shall
be appointed and acting pursuant to Section 8.15 hereof.

         "Authorized  Agent" shall mean any agent of the Company  designated  as
such by an Officers' Certificate delivered to the Trustee.

         "Board Of  Directors"  shall mean the Board of Directors of the Company
or the Executive Committee of such Board or any other duly authorized  committee
of such Board.

         "Board  Resolution" shall mean a copy of a resolution  certified by the
Secretary or an Assistant  Secretary of the Company to have been duly adopted by
the Board of Directors  or any duly  authorized  committee  thereof and to be in
full force and effect on the date of such certification.

         "Business  Day" shall mean each day that is not a day on which  banking
institutions or trust companies in the Borough of Manhattan,  the City and State
of New York, or in the city where the  corporate  trust office of the Trustee is
located, are obligated or authorized by law or executive order to close.

         "Capital  Lease"  shall  mean  any  lease  which  has  been or would be
capitalized on the books of the lessee in accordance with GAAP.

         "Capitalization"  shall  mean  the  total  of all the  following  items
appearing on, or included in, the consolidated balance sheet of the Company: (i)
liabilities for indebtedness maturing more than twelve (12) months from the date
of  determination;  and (ii) common stock,  preferred  stock,  Hybrid  Preferred
Securities,  premium on capital stock, capital surplus, capital in excess of par
value, and retained earnings (however the foregoing may be designated), less, to
the extent not  otherwise  deducted,  the cost of shares of capital stock of the
Company held in its treasury. Subject to the foregoing,  Capitalization shall be
determined  in  accordance  with GAAP and  practices  applicable  to the type of
business in which the Company is engaged and that are approved by

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<PAGE>


independent accountants regularly retained by the Company, and may be determined
as of a date not more than sixty (60) days  prior to the  happening  of an event
for which such determination is being made.

         "Commission"  shall  mean the United  States  Securities  and  Exchange
Commission,  or if at any time  hereafter  the  Commission  is not  existing  or
performing the duties now assigned to it under the TIA, then the body performing
such duties.

         "Company"  shall mean the  corporation  named as the  "Company"  in the
first  paragraph of this  Indenture,  and its successors  and assigns  permitted
hereunder.

         "Company  Order"  shall mean a written  order signed in the name of the
Company by one of the Chairman,  the President,  any Vice President  (whether or
not  designated  by a number or numbers or a word or words added before or after
the title "Vice  President"),  the Treasurer or an Assistant  Treasurer,  of the
Company,  and delivered to the Trustee. At the Company's option, a Company Order
may take the form of a supplemental indenture to this Indenture.

         "Consolidated  Subsidiary" shall mean any Subsidiary whose accounts are
or  are  required  to be  consolidated  with  the  accounts  of the  Company  in
accordance with GAAP.

         "Corporate  Trust Office of The Trustee",  or other similar term, shall
mean the corporate trust office of the Trustee,  at which at any particular time
its corporate trust business shall be principally administered,  which office is
at the date of the execution of this Indenture  located at 114 West 47th Street,
25th Floor, New York, New York, 10036-1532.

         "Debt" shall mean any outstanding debt for money borrowed  evidenced by
notes, debentures, bonds, or other securities, or guarantees of any thereof.

         "Depositary" shall mean, unless otherwise  specified in a Company Order
pursuant to Section 2.05 hereof,  The Depository  Trust  Company,  New York, New
York, or any successor  thereto  registered  and qualified as a clearing  agency
under the  Securities  Exchange  Act of 1934,  or other  applicable  statute  or
regulation.

         "Event Of  Default"  shall mean any event  specified  in  Section  7.01
hereof,  continued  for the period of time,  if any, and after the giving of the
notice, if any, therein designated.

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<PAGE>


         "Expert" shall mean any officer of the Company  familiar with the terms
of this  Indenture,  any law firm,  any  investment  banking  firm, or any other
Person, satisfactory in the reasonable judgment of the Trustee.

         "First Mortgage" shall mean the Mortgage and Deed of Trust, dated as of
January 1, 1942, from the Company to United States Trust Company of New York, as
successor trustee, as supplemented and amended from time to time.

         "First  Mortgage  Bonds" shall mean all first  mortgage bonds issued by
the Company and outstanding under the First Mortgage.

         "GAAP"  shall mean  generally  accepted  accounting  principles  in the
United States of America,  applied on a basis  consistent with those used in the
preparation of any financial  statements  referred to herein,  unless  otherwise
stated herein.

         "Global Note" shall mean a Note that,  pursuant to Section 2.05 hereof,
is issued to evidence Notes,  that is delivered to the Depositary or pursuant to
the  instructions  of the Depositary and that shall be registered in the name of
the Depositary or its nominee.

         "Hybrid  Preferred  Securities"  shall  mean any  preferred  securities
issued  by a  Hybrid  Preferred  Securities  Subsidiary,  where  such  preferred
securities have the following characteristics:

                  (i)  such  Hybrid   Preferred   Securities   Subsidiary  lends
substantially all of the proceeds from the issuance of such preferred securities
to the Company,  or a wholly owned  subsidiary  of the Company,  in exchange for
Subordinated Indebtedness issued by the Company;

                  (ii) such preferred securities contain terms providing for the
deferral of interest  payments  corresponding  to  provisions  providing for the
deferral of interest payments on the related Subordinated Indebtedness; and

                  (iii) the  Company  makes  periodic  interest  payments on the
related Subordinated  Indebtedness,  which interest payments are in turn used by
the Hybrid Preferred Securities Subsidiary to make corresponding payments to the
holders of the preferred securities.

         "Hybrid  Preferred  Securities   Subsidiary"  shall  mean  any  limited
partnership  or  business  trust  (or  similar  entity)  (i) all of the  general
partnership  or common  equity  interest of which is owned  (either  directly or
indirectly through one or more wholly-

                                        4


<PAGE>


owned Subsidiaries of the Company or any Consolidated Subsidiary of the Company)
at all  times by the  Company,  (ii) that has been  formed  for the  purpose  of
issuing Hybrid Preferred Securities and (iii) substantially all of the assets of
which  consist at all times solely of  Subordinated  Indebtedness  issued by the
Company and payments made from time to time on such Subordinated Indebtedness.

         "Indenture"  shall mean this  instrument as originally  executed or, if
amended or supplemented as herein provided, as so amended or supplemented.

         "Interest Payment Date" shall mean (a) each date designated as such for
the payment of  interest  on a Note  specified  in a Company  Order  pursuant to
Section 2.05 hereof (provided that the first Interest Payment Date for any Note,
the Original Issue Date of which is after a Regular Record Date but prior to the
respective  Interest  Payment Date, shall be the Interest Payment Date following
the next  succeeding  Regular Record Date),  (b) a date of maturity of such Note
and (c)  only  with  respect  to  defaulted  interest  on such  Note,  the  date
established by the Trustee for the payment of such defaulted  interest  pursuant
to Section 2.11 hereof.

         "Lien" shall mean any mortgage, security interest, pledge or lien.

         "Maturity,"  when used with respect to any Note, shall mean the date on
which the  principal of such Note  (together  with all  accumulated  and accrued
interest) becomes due and payable as therein or herein provided,  whether at the
stated  maturity  thereof  or by  declaration  of  acceleration,  redemption  or
otherwise.

         "Mortgage Trustee" shall mean the Person serving as trustee at the time
under the First Mortgage.

         "Note" or  "Notes"  shall  mean any Note or Notes,  as the case may be,
authenticated and delivered under this Indenture, including any Global Note.

         "Noteholder",  "Holder of Notes" or  "Holder"  shall mean any Person in
whose  name at the time a  particular  Note is  registered  on the  books of the
Trustee kept for that purpose in accordance with the terms hereof.

         "Officers'  Certificate"  when used with respect to the Company,  shall
mean a  certificate  signed  by one of the  Chairman,  the  President,  any Vice
President  (whether or not  designated by a number or numbers or a word or words
added before or after the

                                        5


<PAGE>


title "Vice President"),  and by one of the Chief Financial Officer,  Treasurer,
any Assistant Treasurer, the Secretary or an Assistant Secretary of the Company;
provided,  that no  individual  shall  be  entitled  to sign  in more  than  one
capacity.

         "Operating Property" shall mean (i) any interest in real property owned
by the Company and (ii) any asset owned by the Company  that is  depreciable  in
accordance with GAAP, excluding,  in either case, any interest of the Company as
lessee  under a Capital  Lease  (except for a lease that results from a Sale and
Lease-Back Transaction).

         "Opinion Of Counsel"  shall mean an opinion in writing  signed by legal
counsel,  who  may  be an  employee  of  the  Company,  meeting  the  applicable
requirements of Section 14.05 hereof. If the Indenture  requires the delivery of
an Opinion of Counsel to the Trustee,  the text and  substance of which has been
previously delivered to the Trustee, the Company may satisfy such requirement by
the  delivery by the legal  counsel  that  delivered  such  previous  Opinion of
Counsel of a letter to the  Trustee to the effect  that the  Trustee may rely on
such  previous  Opinion of Counsel as if such  Opinion of Counsel  was dated and
delivered the date delivery of such Opinion of Counsel is required.  Any Opinion
of Counsel may contain reasonable conditions and qualifications  satisfactory to
the Trustee.

         "Original  Issue Date" shall mean for a Note, or portion  thereof,  the
date upon which it, or such portion,  was issued by the Company pursuant to this
Indenture and  authenticated  by the Trustee  (other than in  connection  with a
transfer, exchange or substitution).

         "Outstanding",  when used with  reference to Notes,  shall,  subject to
Section 9.04 hereof,  mean, as of any particular  time, all Notes  authenticated
and delivered by the Trustee under this Indenture, except

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

                  (b) Notes, or portions thereof,  for the payment or redemption
of which moneys in the necessary  amount shall have been deposited in trust with
the Trustee or with any paying agent (other than the Company),  provided that if
such Notes are to be  redeemed  prior to the  maturity  thereof,  notice of such
redemption  shall have been given as  provided  in Article  III,  or  provisions
satisfactory to the Trustee shall have been made for giving such notice;

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<PAGE>


                  (c)  Notes,  or  portions  thereof,  that  have  been paid and
discharged  or are  deemed  to have  been paid and  discharged  pursuant  to the
provisions of this Indenture; and

                  (d) Notes in lieu of or in substitution  for which other Notes
shall have been authenticated and delivered,  or which have been paid,  pursuant
to Section 2.07 hereof.

         "Person" shall mean any  individual,  corporation,  partnership,  joint
venture,  limited liability company,  association,  joint-stock company,  trust,
unincorporated  organization or government or any agent or political subdivision
thereof.

         "Principal Executive Offices Of The Company" shall mean 2800 Pottsville
Pike, Reading,  Pennsylvania 19605, or such other place where the main corporate
offices of the Company are located as designated in writing to the Trustee by an
Authorized Agent.

         "Regular  Record  Date" shall mean,  unless  otherwise  specified  in a
Company  Order  pursuant to Section  2.05,  for an Interest  Payment  Date for a
particular  Note (a) the fifteenth day of the calendar month next preceding each
Interest  Payment Date (unless the Interest Payment Date is the date of maturity
of such Note, in which event,  the Regular  Record Date shall be as described in
clause (b) hereof) and (b) the date of maturity of such Note.

         "Responsible Officer" or "Responsible  Officers" when used with respect
to the  Trustee  shall mean one or more of the  following:  the  chairman of the
board of directors, the vice chairman of the board of directors, the chairman of
the executive  committee,  the  president,  any vice  president  (whether or not
designated  by a number or a word or words added before or after the title "Vice
President"),  the  secretary,  the treasurer,  any trust officer,  any assistant
trust officer, any second or assistant vice president,  any assistant secretary,
any  assistant  treasurer,  or any other  officer  or  assistant  officer of the
Trustee  customarily  performing  functions  similar to those  performed  by the
persons  who at the time shall be such  officers,  respectively,  or to whom any
corporate  trust  matter is  referred  because  of his or her  knowledge  of and
familiarity with the particular subject.

         "Sale and Lease-Back  Transaction"  shall mean any arrangement with any
Person  providing  for the  leasing  to the  Company of any  Operating  Property
(except for leases for a term,  including any renewal thereof,  of not more than
forty-eight (48) months),  which Operating Property has been or is to be sold or
transferred by the Company to such Person; provided, however, Sale and Lease-

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<PAGE>


Back Transaction  shall not include any arrangement  first entered into prior to
the date of this Indenture.

         "Special  Record Date" shall mean,  with respect to any Note,  the date
established by the Trustee in connection with the payment of defaulted  interest
on such Note pursuant to Section 2.11 hereof.

         "Stated Maturity" shall mean with respect to any Note, the last date on
which  principal  on such Note  becomes  due and  payable  as  therein or herein
provided, other than by declaration of acceleration or by redemption.

         "Subordinated  Indebtedness"  shall  mean  any  unsecured  Debt  of the
Company (i) issued in exchange for the proceeds of Hybrid  Preferred  Securities
and (ii) subordinated to the rights of the Holders hereunder.

         "Subsidiary"  shall mean, as to any Person,  any  corporation  or other
entity  of  which at  least a  majority  of the  securities  or other  ownership
interest  having  ordinary  voting power  (absolutely or  contingently)  for the
election of directors or other Persons  performing  similar functions are at the
time owned directly or indirectly by such Person.

         "Tangible  Assets"  shall mean the amount  shown as total assets on the
consolidated  balance sheet of the Company,  less the following:  (i) intangible
assets including,  but without limitation,  such items as goodwill,  trademarks,
trade  names,  patents,  and  unamortized  debt  discount  and  expense and (ii)
appropriate  adjustments,  if any,  on account of minority  interests.  Tangible
Assets shall be determined in accordance  with GAAP and practices  applicable to
the type of business  in which the  Company is engaged and that are  approved by
the  independent  accountants  regularly  retained  by the  Company,  and may be
determined  as of a date not more than sixty (60) days prior to the happening of
the event for which such determination is being made.

         "Trustee"  shall  mean  United  States  Trust  Company of New York and,
subject to Article VIII, shall also include any successor Trustee.

         "U.S.  Government  Obligations"  shall  mean  (i)  direct  non-callable
obligations of, or non-callable  obligations  guaranteed as to timely payment of
principal  and interest  by, the United  States of America or  obligations  of a
person  controlled or  supervised by and acting as an agency or  instrumentality
thereof for the payment of which  obligations  or  guarantee  the full faith and
credit of the United States is pledged, or (ii) certificates

                                        8


<PAGE>


or receipts  representing direct ownership interests in obligations or specified
portions (such as principal or interest) of obligations  described in clause (i)
above,  which  obligations  are held by a custodian in  safekeeping  in a manner
satisfactory to the Trustee.

         "Value" shall mean, with respect to a Sale and Lease-Back  Transaction,
as of any  particular  time,  the  amount  equal to the  greater  of (i) the net
proceeds  to the  Company  from  the sale or  transfer  of the  property  leased
pursuant to such Sale and  Lease-Back  Transaction or (ii) the net book value of
such property,  as determined in accordance with GAAP by the Company,  in either
case  multiplied  by a fraction,  the  numerator  of which shall be equal to the
number  of full  years of the term of the  lease  that is part of such  Sale and
Lease-Back   Transaction   remaining  at  the  time  of  determination  and  the
denominator  of which  shall be equal to the  number of full years of such term,
without regard,  in any case, to any renewal or extension  options  contained in
such lease.

                                   ARTICLE II

                    FORM, ISSUE, EXECUTION, REGISTRATION AND

                                EXCHANGE OF NOTES

         Section 2.01  Form Generally.
                       --------------

         (a) If the  Notes  are in the form of a Global  Note  they  shall be in
substantially  the form set forth in Exhibit A to this  Indenture,  and,  if the
Notes are not in the form of a Global Note, they shall be in  substantially  the
form set forth in Exhibit B to this  Indenture,  or, in any case,  in such other
form as shall be established by a Board Resolution,  or a Company Order pursuant
to a Board Resolution, or in one or more indentures supplemental hereto, in each
case  with  such  appropriate  insertions,  omissions,  substitutions  and other
variations  as are required or permitted by this  Indenture,  or any  indentures
supplemental  hereto,  and may have  such  letters,  numbers  or other  marks of
identification  and  such  legends  or  endorsements  placed  thereon  as may be
required to comply with  applicable  rules of any securities  exchange or of the
Depositary  or  with  applicable  law  or  as  may,  consistently  herewith,  be
determined by the officers executing such Notes, as evidenced by their execution
of such Notes.

         (b) The  definitive  Notes  shall be typed,  printed,  lithographed  or
engraved on steel engraved  borders or may be produced in any other manner,  all
as  determined  by the  officers  executing  such Notes,  as  evidenced by their
execution of such Notes.

                                        9


<PAGE>


         Section  2.02 Form Of  Trustee's  Certificate  Of  Authentication.  The
Trustee's  certificate of  authentication on all Notes shall be in substantially
the following form:

                               Trustee's Certificate of Authentication

         This  Note  is one of  the  Notes  of  the  series  herein  designated,
described or provided for in the within-mentioned Indenture.

                                       United States Trust Company of New York


                                       By:--------------------------------
                                              Authorized Officer

         Section 2.03 Amount Unlimited.  The aggregate principal amount of Notes
that may be  authenticated  and  delivered  under this  Indenture is  unlimited,
subject to compliance with the provisions of this Indenture.

         Section 2.04   Denominations, Dates, Interest Payment And Record Dates

         (a) The Notes shall be issuable in registered  form without  coupons in
denominations of $1,000 and integral  multiples  thereof or such other amount or
amounts  as may be  authorized  by the Board of  Directors  or a  Company  Order
pursuant to a Board Resolution or in one or more indentures supplemental hereto;
provided,  that  the  principal  amount  of  a  Global  Note  shall  not  exceed
$200,000,000 unless otherwise permitted by the Depositary.

         (b)  Each  Note  shall  be  dated  and  issued  as of the  date  of its
authentication by the Trustee,  and shall bear an Original Issue Date; each Note
issued upon transfer, exchange or substitution of a Note shall bear the Original
Issue Date or Dates of such transferred,  exchanged or substituted Note, subject
to the provisions of Section 2.13(e) hereof.

         (c) Each Note shall bear  interest  from the later of (1) its  Original
Issue Date or the date  specified  in such Note or (2) the most  recent  date to
which  interest  has been paid or duly  provided  for with  respect to such Note
until the  principal of such Note is paid or made  available  for  payment,  and
interest on each Note shall be payable on each  Interest  Payment Date after the
Original Issue Date.

                                       10


<PAGE>


         (d) Each Note shall mature on a stated maturity  specified in the Note.
The principal  amount of each  Outstanding Note shall be payable on the maturity
date or dates specified therein.

         (e) Unless  otherwise  specified in a Company Order pursuant to Section
2.05 hereof, interest on each of the Notes shall be calculated on the basis of a
360-day year of twelve 30-day months and shall be computed at a fixed rate until
the maturity of such Notes.  The method of  computing  interest on any Notes not
bearing a fixed rate of interest  shall be set forth in a Company Order pursuant
to Section 2.05 hereof.  Unless otherwise  specified in a Company Order pursuant
to Section 2.05 hereof,  principal,  interest and premium,  if any, on the Notes
shall be payable in the currency of the United States.

         (f) Except as provided in the following  sentence,  the Person in whose
name any Note is registered at the close of business on any Regular  Record Date
or Special  Record Date with  respect to an Interest  Payment Date for such Note
shall be entitled to receive the interest  payable on such Interest Payment Date
notwithstanding the cancellation of such Note upon any registration of transfer,
exchange or  substitution of such Note subsequent to such Regular Record Date or
Special  Record  Date and prior to such  Interest  Payment  Date.  Any  interest
payable at maturity  shall be paid to the Person to whom the  principal  of such
Note is payable.

         (g) So long as the  Trustee  is the  registrar  and paying  agent,  the
Trustee shall,  as soon as practicable but no later than the Regular Record Date
preceding each applicable  Interest Payment Date,  provide to the Company a list
of the  principal,  interest  and  premium to be paid on Notes on such  Interest
Payment Date. The Trustee shall assume  responsibility  for withholding taxes on
interest paid as required by law except with respect to any Global Note.

          Section 2.05 Execution, Authentication, Delivery And Dating.
                       ----------------------------------------------

         (a) The Notes  shall be executed on behalf of the Company by one of its
Chairman,  President,  any Vice President (whether or not designated by a number
or numbers or a word or words added before or after the title "Vice President"),
its  Treasurer  or an  Assistant  Treasurer  of the Company and  attested by the
Secretary or an Assistant  Secretary  of the  Company.  The  signature of any of
these officers on the Notes may be manual or facsimile.  Typographical and other
minor errors or defects in any such  signature  shall not affect the validity or
enforceability of any Note that has been duly authenticated and delivered by the
Trustee.

                                       11


<PAGE>


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

         (c) At any time and from time to time after the  execution and delivery
of this Indenture,  the Company may deliver Notes executed by the Company to the
Trustee for  authentication,  together  with or preceded by one or more  Company
Orders for the  authentication  and  delivery of such Notes,  and the Trustee in
accordance with any such Company Order shall authenticate and make available for
delivery  such Notes.  The Notes shall be issued in series.  Such Company  Order
shall  specify  the  following  with  respect to each  series of Notes:  (i) any
limitations on the aggregate  principal amount of the Notes to be issued as part
of such series,  (ii) the Original Issue Date for such series,  (iii) the stated
maturity or maturities of Notes of such series, (iv) the interest rate or rates,
or method of  calculation  of such rate or rates,  for such  series and the date
from which such  interest  will accrue,  (v) the terms,  if any,  regarding  the
optional or mandatory  redemption of such series,  including  redemption date or
dates of such  series,  if any,  and the  price  or  prices  applicable  to such
redemption,  (vi)  whether  or not the Notes of such  series  shall be issued in
whole or in part in the form of a Global  Note and,  if so, the  Depositary  for
such Global Note,  (vii) the  designation of such series,  (viii) if the form of
the Notes of such series is not as  described  in Exhibit A or Exhibit B hereto,
the form of the Notes of such series,  (ix) the maximum annual interest rate, if
any, of the Notes permitted for such series, (x) any other information necessary
to complete the Notes of such series,  (xi) the  establishment  of any office or
agency pursuant to Section 5.02 hereof, and (xii) any other terms of such series
not  inconsistent  with this  Indenture.  Prior to  authenticating  Notes of any
series, and in accepting the additional responsibilities under this Indenture in
relation to such Notes, the Trustee shall receive from the Company the following
at or before the  issuance  of the  initial  Note of such  series of Notes,  and
(subject to Section  8.01  hereof)  shall be fully  protected  in relying  upon,
unless and until such  documents  have been  superseded or revoked prior to such
issuance:

                  (1) A Board  Resolution  authorizing  such  Company  Order  or
         Orders and, if the form of Notes is established  by a Board  Resolution
         or a Company Order pursuant to a Board Resolution, a copy of such Board
         Resolution;

                                       12


<PAGE>


                  (2) At the option of the Company, either an Opinion of Counsel
         or a  letter  addressed  to the  Trustee  permitting  it to  rely on an
         Opinion of Counsel,  stating  substantially  the  following  subject to
         customary qualifications and exceptions:

                                    (A)  if  the   form  of   Notes   has   been
                  established  by or pursuant to a Board  Resolution,  a Company
                  Order  pursuant to a Board  Resolution,  or in a  supplemental
                  indenture as permitted by Section 2.01 hereof,  that such form
                  has been established in conformity with this Indenture;

                                    (B)  that  the   Indenture   has  been  duly
                  authorized,   executed  and   delivered  by  the  Company  and
                  constitutes  a valid and binding  obligation  of the  Company,
                  enforceable  against the Company in accordance with its terms,
                  except as may be limited by applicable bankruptcy, insolvency,
                  reorganization,  fraudulent conveyance,  moratorium or similar
                  laws of  general  application  relating  to or  affecting  the
                  enforcement of creditors'  rights,  the application of general
                  principles of equity  (regardless of whether such  application
                  is made in a proceeding at law or in equity) and by an implied
                  covenant  of  good  faith  and  fair  dealing  and  except  as
                  enforcement  of  provisions of the Indenture may be limited by
                  state laws  affecting the remedies for the  enforcement of the
                  security provided for in the Indenture;

                                    (C) that the Indenture is qualified to the
                  extent necessary under the TIA;

                                    (D)  that   such   Notes   have   been  duly
                  authorized and executed by the Company, and when authenticated
                  by the  Trustee  and  issued by the  Company in the manner and
                  subject  to  any  conditions  specified  in  such  Opinion  of
                  Counsel,  will constitute valid and binding obligations of the
                  Company, enforceable in accordance with their terms, except as
                  may  be  limited   by   applicable   bankruptcy,   insolvency,
                  reorganization,  fraudulent conveyance,  moratorium or similar
                  laws of  general  application  relating  to or  affecting  the
                  enforcement of creditors'  rights,  the application of general
                  principles of equity  (regardless of whether such  application
                  is made in a proceeding at law or in equity) and by an implied
                  covenant  of  good  faith  and  fair  dealing  and  except  as
                  enforcement  of provisions of this Indenture may be limited by
                  state laws affecting

                                       13


<PAGE>


                  the remedies for the enforcement of the security provided for
                  in this Indenture;

                                    (E) that all  consents or  approvals  of any
                  federal or state regulatory agency required in connection with
                  the  Company's  execution  and delivery of this  Indenture and
                  such series of Notes have been  obtained and are in full force
                  and effect (except that no statement need be made with respect
                  to state securities laws); and

                                    (F)that all  conditions  that must be met by
                  the Company to issue Notes under this Indenture have been met.

                  (3) An Officers'  Certificate  stating that (i) the Company is
         not, and upon the authentication by the Trustee of the series of Notes,
         will not be in default under any of the terms or covenants contained in
         this Indenture and (ii) all conditions  that must be met by the Company
         to issue Notes under this Indenture have been met.

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

         (e) If all Notes of a series are not to be authenticated  and issued at
one time, the Company shall not be required to deliver the Company Order,  Board
Resolutions,  Officers' Certificate and Opinion of Counsel (including any of the
foregoing  that would be otherwise  required  pursuant to Section  14.05 hereof)
described in Section  2.05(c) hereof at or prior to the  authentication  of each
Note of such  series,  if such  items are  delivered  at or prior to the time of
authentication  of the first Note of such series to be authenticated and issued.
If all of the Notes of a series  are not  authenticated  and issued at one time,
for each  issuance  of Notes after the  initial  issuance of Notes,  the Company
shall be required only to deliver to the Trustee the Note and a written  request
(executed  by one of the  Chairman,  the  President,  any  Vice  President,  the
Treasurer,  or an Assistant  Treasurer) to the Trustee to authenticate such Note
and to deliver such Note in accordance with the  instructions  specified by such
request.  Any such request shall constitute a representation and warranty by the
Company that the statements

                                       14


<PAGE>


made  in the  Officers'  Certificate  delivered  to  the  Trustee  prior  to the
authentication  and  issuance  of the  first  Note of such  series  are true and
correct on the date thereof as if made on and as of the date thereof.

         Section 2.06 Exchange And Registration Of Transfer Of Notes.
                      ----------------------------------------------

         (a) Subject to Section 2.13 hereof,  Notes may be exchanged  for one or
more new Notes of any authorized denominations and of a like aggregate principal
amount,  series and stated maturity and having the same terms and Original Issue
Date.  Notes to be  exchanged  shall be  surrendered  at any of the  offices  or
agencies to be maintained pursuant to Section 5.02 hereof, and the Trustee shall
authenticate  and  deliver  in  exchange  therefor  the Note or Notes  which the
Noteholder making the exchange shall be entitled to receive.

         (b) The  Trustee  shall keep,  at one of said  offices or  agencies,  a
register or registers in which, subject to such reasonable regulations as it may
prescribe,  the Trustee shall register or cause to be registered Notes and shall
register or cause to be  registered  the transfer of Notes as in this Article II
provided. Such register shall be in written form or in any other form capable of
being  converted  into written form within a reasonable  time. At all reasonable
times,  such  register  shall be open for  inspection  by the Company.  Upon due
presentment  for  registration  of  transfer  of any Note at any such  office or
agency,  the Company shall execute and the Trustee shall register,  authenticate
and deliver in the name of the transferee or  transferees  one or more new Notes
of any authorized denominations and of a like aggregate principal amount, series
and stated maturity and having the same terms and Original Issue Date.

         (c) All Notes  presented for  registration of transfer or for exchange,
redemption or payment shall be duly endorsed by, or be  accompanied by a written
instrument or  instruments of transfer in form  satisfactory  to the Company and
the Trustee  and duly  executed  by, the Holder or the  attorney in fact of such
Holder duly authorized in writing.

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

         (e) The Trustee  shall not be  required  to  exchange  or register  the
transfer of any Notes selected, called or being called for redemption (including
Notes,  if any,  redeemable at the option of the Holder  provided such Notes are
then redeemable at

                                       15


<PAGE>


such Holder's  option)  except,  in the case of any Note to be redeemed in part,
the portion thereof not to be so redeemed.

         (f) If the principal amount, and applicable  premium,  of part, but not
all, of a Note is paid,  then upon  surrender  to the Trustee of such Note,  the
Company shall execute, and the Trustee shall authenticate, deliver and register,
a Note in an authorized denomination in aggregate principal amount equal to, and
having the same terms,  Original Issue Date and series as, the unpaid portion of
such Note.

         Section 2.07  Mutilated,  Destroyed,  Lost Or Stolen Notes.  (a) If any
Note shall become mutilated or be destroyed,  lost or stolen,  the Company shall
execute,  and upon its  written  request  the  Trustee  shall  authenticate  and
deliver,  a new Note of like form and principal amount and having the same terms
and Original Issue Date and bearing a number not contemporaneously  Outstanding,
in  exchange  and  substitution  for the  mutilated  Note,  or in lieu of and in
substitution  for the Note so  destroyed,  lost or  stolen.  In  every  case the
applicant for a substituted  Note shall furnish to the Company,  the Trustee and
any paying agent or  Authenticating  Agent such  security or indemnity as may be
required  by  them  to  save  each  of them  harmless,  and,  in  every  case of
destruction,  loss or theft of a Note,  the applicant  shall also furnish to the
Company and to the Trustee  evidence to their  satisfaction of the  destruction,
loss or theft of such Note and of the ownership thereof.

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

         (c) Every  substituted  Note issued  pursuant to this  Section  2.07 by
virtue of the fact that any Note is mutilated,  destroyed,  lost or stolen shall
constitute an additional contractual

                                       16


<PAGE>


obligation of the Company,  whether or not such  destroyed,  lost or stolen Note
shall be found at any time,  and shall be entitled  to all the  benefits of this
Indenture equally and  proportionately  with any and all other Notes duly issued
hereunder. All Notes shall be held and owned upon the express condition that, to
the extent permitted by law, the foregoing provisions are exclusive with respect
to the replacement or payment of mutilated,  destroyed, lost or stolen Notes and
shall preclude to the full extent  permitted by applicable law any and all other
rights or remedies  with  respect to the  replacement  or payment of  negotiable
instruments or other securities without their surrender.

         Section 2.08  Temporary  Notes.  Pending the  preparation of definitive
Notes,  the Company may execute and the Trustee shall  authenticate  and deliver
temporary Notes (printed, lithographed or otherwise reproduced). Temporary Notes
shall be issuable in any authorized  denomination and  substantially in the form
of the definitive  Notes but with such  omissions,  insertions and variations as
may be appropriate for temporary Notes, all as may be determined by the Company.
Every such  temporary Note shall be  authenticated  by the Trustee upon the same
conditions and in substantially  the same manner,  and with the same effect,  as
the definitive Notes.  Without  unreasonable delay the Company shall execute and
shall deliver to the Trustee definitive Notes and thereupon any or all temporary
Notes shall be surrendered in exchange therefor at the Corporate Trust Office of
the  Trustee,  and the  Trustee  shall  authenticate,  deliver  and  register in
exchange  for such  temporary  Notes  an equal  aggregate  principal  amount  of
definitive  Notes. Such exchange shall be made by the Company at its own expense
and without any charge  therefor to the  Noteholders.  Until so  exchanged,  the
temporary  Notes shall in all  respects be entitled to the same  benefits  under
this Indenture as definitive Notes authenticated and delivered hereunder.

         Section 2.09 Cancellation Of Notes Paid, Etc. All Notes surrendered for
the purpose of payment,  redemption,  exchange or registration of transfer shall
be surrendered to the Trustee for cancellation  and promptly  canceled by it and
no Notes shall be issued in lieu thereof  except as expressly  permitted by this
Indenture.  The Company shall  surrender to the Trustee any Notes so acquired by
it and  such  Notes  shall  be  canceled  by the  Trustee.  No  Notes  shall  be
authenticated in lieu of or in exchange for any Notes so canceled.

         Section 2.10 Interest Rights Preserved.  Each Note delivered under this
Indenture upon transfer of or in exchange for or in lieu of any other Note shall
carry all the rights to interest accrued and unpaid,  and to accrue,  which were
carried by such other Note, and each such Note shall be so dated that neither

                                       17


<PAGE>


gain  nor  loss of  interest  shall  result  from  such  transfer,  exchange  or
substitution.

         Section 2.11 Special Record Date. If and to the extent that the Company
fails to make timely  payment or provision for timely payment of interest on any
series of Notes  (other  than on an  Interest  Payment  Date that is a  maturity
date),  that  interest  shall  cease to be payable to the  Persons  who were the
Noteholders of such series at the applicable Regular Record Date. In that event,
when moneys become available for payment of the interest,  the Trustee shall (a)
establish a date of payment of such  interest and a Special  Record Date for the
payment of that interest, which Special Record Date shall be not more than 15 or
fewer than 10 days prior to the date of the proposed payment and (b) mail notice
of the date of payment  and of the  Special  Record  Date not fewer than 10 days
preceding the Special Record Date to each Noteholder of such series at the close
of  business  on the 15th day  preceding  the  mailing  at the  address  of such
Noteholder,  as it  appeared  on the  register  for  the  Notes.  On the  day so
established  by the Trustee the interest  shall be payable to the Holders of the
applicable Notes at the close of business on the Special Record Date.

         Section 2.12  Payment Of Notes. Payment of the principal, interest and
                       ----------------
 premium, if any,  on all Notes shall be payable as follows:

         (a) On or before 9:30 a.m.,  New York City time,  or such other time as
shall be agreed upon  between the Trustee and the  Company,  of the day on which
payment of  principal,  interest and premium,  if any, is due on any Global Note
pursuant to the terms  thereof,  the Company  shall deliver to the Trustee funds
available on such date  sufficient  to make such  payment,  by wire  transfer of
immediately available funds or by instructing the Trustee to withdraw sufficient
funds from an account  maintained  by the Company with the Trustee or such other
method as is acceptable to the Trustee.  On or before 12:00 noon,  New York City
time,  or such other time as shall be agreed  upon  between  the Trustee and the
Depositary,  of the day on which any  payment of  interest  is due on any Global
Note (other than at  maturity),  the Trustee  shall pay to the  Depositary  such
interest in same day funds.  On or before 1:00 p.m., New York City time, or such
other time as shall be agreed upon  between the Trustee and the  Depositary,  of
the day on which principal, interest payable at maturity and premium, if any, is
due on any Global Note, the Trustee shall deposit with the Depositary the amount
equal to the  principal,  interest  payable at maturity and premium,  if any, by
wire transfer into the account  specified by the  Depositary.  As a condition to
the payment,  at maturity or upon  redemption,  of any part of the principal of,
interest on and applicable premium of any Global

                                       18


<PAGE>


Note, the Depositary  shall surrender,  or cause to be surrendered,  such Global
Note to the  Trustee,  whereupon  a new  Global  Note  shall  be  issued  to the
Depositary pursuant to Section 2.06(f) hereof.

         (b) With  respect  to any Note  that is not a Global  Note,  principal,
applicable premium and interest due at the maturity of the Note shall be payable
in immediately  available funds when due upon presentation and surrender of such
Note at the corporate trust office of the Trustee or at the authorized office of
any paying  agent.  Interest  on any Note that is not a Global  Note (other than
interest  payable  at  maturity)  shall be paid by check  mailed  to the  Holder
thereof at such Holder's  address as it appears on the register by check payable
in clearinghouse funds;  provided that if the Trustee receives a written request
from any Holder of Notes,  the  aggregate  principal  amount of which having the
same  Interest  Payment  Date  equals or exceeds  $10,000,000,  on or before the
applicable Regular Record Date for such Interest Payment Date, interest shall be
paid by wire  transfer  of  immediately  available  funds to a bank  within  the
continental  United States designated by such Holder in its request or by direct
deposit into the account of such Holder designated by such Holder in its request
if such account is maintained with the Trustee or any paying agent.

         Section 2.13  Notes Issuable In The Form Of A Global Note.
                       -------------------------------------------

         (a) If the Company shall establish pursuant to Section 2.05 hereof that
the  Notes of a  particular  series  are to be issued in whole or in part in the
form of one or more Global Notes, then the Company shall execute and the Trustee
shall, in accordance with Section 2.05 hereof and the Company Order delivered to
the Trustee  thereunder,  authenticate  and  deliver  such Global Note or Notes,
which (i)  shall  represent,  shall be  denominated  in an  amount  equal to the
aggregate principal amount of, and shall have the same terms as, the Outstanding
Notes of such series to be represented by such Global Note or Notes,  (ii) shall
be  registered  in the name of the  Depositary  or its  nominee,  (iii) shall be
delivered  by the Trustee to the  Depositary  or  pursuant  to the  Depositary's
instruction and (iv) shall bear a legend  substantially to the following effect:
"This Note is a Global Note  registered in the name of the Depositary  (referred
to herein) or a nominee  thereof and,  unless and until it is exchanged in whole
or in part for the individual Notes represented hereby, this Global Note may not
be  transferred  except  as a  whole  by  the  Depositary  to a  nominee  of the
Depositary  or by a nominee  of the  Depositary  to the  Depositary  or  another
nominee  of  the  Depositary  or by the  Depositary  or any  such  nominee  to a
successor  Depositary  or a nominee of such  successor  Depositary.  Unless this
Global Note is presented by an

                                       19


<PAGE>


authorized  representative of The Depository Trust Company (55 Water Street, New
York,  New York),  to the  Trustee for  registration  of  transfer,  exchange or
payment,  and any certificate  issued is registered in the name of Cede & Co. or
such other name as requested by an authorized  representative  of The Depository
Trust  Company and any payment is made to Cede & Co.,  any  transfer,  pledge or
other use hereof for value or  otherwise  by or to any person is wrongful  since
the registered  owner hereof,  Cede & Co., has an interest herein" or such other
legend as may be required by the rules and regulations of the Depositary.

         (b)  Notwithstanding  any other  provision of Section 2.06 hereof or of
this  Section  2.13,  unless the terms of a Global  Note  expressly  permit such
Global Note to be exchanged in whole or in part for  individual  Notes, a Global
Note may be  transferred,  in whole but not in part,  only as  described  in the
legend thereto.

         (c) (i) If at any time the  Depositary  for a Global Note  notifies the
Company that it is unwilling or unable to continue as Depositary for such Global
Note or if at any time the  Depositary  for the  Global  Note shall no longer be
eligible or in good standing under the Securities  Exchange Act of 1934 or other
applicable  statute  or  regulation,  the  Company  shall  appoint  a  successor
Depositary with respect to such Global Note. If a successor  Depositary for such
Global Note is not  appointed  by the  Company  within 90 days after the Company
receives  such  notice or becomes  aware of such  ineligibility,  the  Company's
election  pursuant to Section  2.05(c)(vi)  hereof  shall no longer be effective
with  respect  to the  series of Notes  evidenced  by such  Global  Note and the
Company shall execute, and the Trustee,  upon receipt of a Company Order for the
authentication  and delivery of individual  Notes of such series in exchange for
such Global  Note,  shall  authenticate  and deliver,  individual  Notes of such
series of like  tenor and terms in  definitive  form in an  aggregate  principal
amount  equal to the  principal  amount of the Global Note in exchange  for such
Global Note.  The Trustee  shall not be charged with  knowledge or notice of the
ineligibility  of a  Depositary  unless a  Responsible  Officer  assigned to and
working in its corporate  trustee  administration  department  shall have actual
knowledge thereof.

                  (ii)  (A)  The  Company  may at  any  time  and  in  its  sole
discretion  determine  that all  Outstanding  (but not less than all) Notes of a
series  issued or  issuable  in the form of one or more  Global  Notes  shall no
longer be  represented  by such Global Note or Notes.  In such event the Company
shall  execute,  and the  Trustee,  upon  receipt  of a  Company  Order  for the
authentication  and  delivery of  individual  Notes in exchange  for such Global
Note, shall authenticate and deliver individual Notes of like

                                       20


<PAGE>


tenor and terms in definitive form in an aggregate principal amount equal to the
principal  amount of such Global Note or Notes in exchange  for such Global Note
or Notes.

                           (B)  Within  seven  days after the  occurrence  of an
Event of Default,  the Company shall execute, and the Trustee shall authenticate
and  deliver,  Notes  of  such  series  in  definitive  registered  form  in any
authorized  denominations  and  in  aggregate  principal  amount  equal  to  the
principal amount of the Global Notes in exchange for such Global Notes.

                  (iii) In any exchange provided for in any of the preceding two
paragraphs,  the Company  will  execute and the Trustee  will  authenticate  and
deliver   individual   Notes  in  definitive   registered   form  in  authorized
denominations.  Upon the exchange of a Global Note for  individual  Notes,  such
Global Note shall be canceled by the  Trustee.  Notes  issued in exchange  for a
Global Note  pursuant to this Section  shall be  registered in such names and in
such authorized  denominations as the Depositary for such Global Note,  pursuant
to instructions  from its direct or indirect  participants  or otherwise,  shall
instruct the Trustee. The Trustee shall deliver such Notes to the Depositary for
delivery to the persons in whose names such Notes are so  registered,  or if the
Depositary  shall refuse or be unable to deliver such Notes,  the Trustee  shall
deliver  such  Notes to the  persons in whose  names such Notes are  registered,
unless otherwise agreed upon between the Trustee and the Company, in which event
the Company  shall cause the Notes to be delivered to the persons in whose names
such Notes are registered.

         (d) Neither the Company,  the Trustee, any Authenticating Agent nor any
paying agent shall have any  responsibility  or liability  for any aspect of the
records  relating  to, or  payments  made on account  of,  beneficial  ownership
interests of a Global Note or for  maintaining,  supervising  or  reviewing  any
records relating to such beneficial ownership interests.

         (e) Pursuant to the provisions of this subsection, at the option of the
Trustee and upon 30 days' written  notice to the Depositary but not prior to the
first Interest Payment Date of the respective Global Notes, the Depositary shall
be  required to  surrender  any two or more  Global  Notes which have  identical
terms, including, without limitation,  identical maturities,  interest rates and
redemption provisions (but which may have differing Original Issue Dates) to the
Trustee,  and the Company shall execute and the Trustee shall  authenticate  and
deliver to, or at the  direction  of, the  Depositary a Global Note in principal
amount equal to the aggregate  principal amount of, and with all terms identical
to, the Global Notes surrendered thereto and that shall indicate each applicable
Original Issue Date and the

                                       21


<PAGE>


principal  amount  applicable  to each such  Original  Issue Date.  The exchange
contemplated in this  subsection  shall be consummated at least 30 days prior to
any Interest  Payment Date applicable to any of the Global Notes  surrendered to
the  Trustee.  Upon any  exchange of any Global  Note with two or more  Original
Issue  Dates,  whether  pursuant to this  Section or pursuant to Section 2.06 or
Section  3.03  hereof,  the  aggregate  principal  amount  of the  Notes  with a
particular Original Issue Date shall be the same before and after such exchange,
after giving  effect to any  retirement  of Notes and the  Original  Issue Dates
applicable to such Notes occurring in connection with such exchange.

                                   ARTICLE III

                               REDEMPTION OF NOTES

         Section  3.01  Applicability  Of Article.  Such of the Notes as are, by
their terms, redeemable prior to their stated maturity date at the option of the
Company,  may be redeemed by the Company at such times,  in such  amounts and at
such prices as may be specified therein and in accordance with the provisions of
this Article III.

         Section 3.02  Notice Of Redemption; Selection Of Notes.
                       ----------------------------------------

         (a) The  election of the Company to redeem any Notes shall be evidenced
by an Officer's  Certificate  which shall be given with notice of  redemption to
the Trustee at least 45 days (or such shorter  period  acceptable to the Trustee
in its sole discretion) prior to the redemption date specified in such notice.

         (b) Notice of  redemption  to each  Holder of Notes to be redeemed as a
whole or in part  shall  be given by the  Trustee,  in the  manner  provided  in
Section  14.10  hereof,  no less than 30 or more than 60 days  prior to the date
fixed for  redemption.  Any notice which is given in the manner herein  provided
shall be  conclusively  presumed  to have been duly  given,  whether  or not the
Noteholder  receives the notice. In any case,  failure duly to give such notice,
or any  defect  in  such  notice,  to the  Holder  of any  Note  designated  for
redemption  as a  whole  or in  part  shall  not  affect  the  validity  of  the
proceedings for the redemption of any other Note.

         (c) Each such notice shall specify the date fixed for  redemption,  the
places of redemption  and the  redemption  price (or the method for  calculation
thereof) at which such Notes are to be redeemed,  and shall state that  (subject
to subsection (e) of this Section) payment of the redemption price of such Notes
or portion

                                       22


<PAGE>


thereof to be redeemed will be made upon  surrender of such Notes at such places
of redemption,  that interest  accrued to the date fixed for redemption  will be
paid as  specified in such  notice,  and that from and after such date  interest
thereon shall cease to accrue.  If less than all of a series of Notes having the
same terms are to be redeemed,  the notice  shall  specify the Notes or portions
thereof to be redeemed.  If any Note is to be redeemed in part only,  the notice
which  relates to such Note shall  state the  portion  of the  principal  amount
thereof to be redeemed, and shall state that, upon surrender of such Note, a new
Note or Notes having the same terms in aggregate  principal  amount equal to the
unredeemed portion thereof will be issued.

         (d) Unless  otherwise  provided by a supplemental  indenture or Company
Order under Section 2.05 hereof,  if less than all of a series of Notes,  or any
tranche thereof,  is to be redeemed,  the Trustee shall select in such manner as
it shall deem  appropriate and fair in its discretion the particular Notes to be
redeemed in whole or in part and shall thereafter promptly notify the Company in
writing  of the Notes so to be  redeemed.  If less than all of a series of Notes
represented by a Global Note is to be redeemed, the particular Notes or portions
thereof of such series to be redeemed  shall be selected by the  Depositary  for
such series of Notes in such manner as the  Depositary  shall  determine.  Notes
shall be redeemed only in denominations  of $1,000,  provided that any remaining
principal  amount of a Note redeemed in part shall be a denomination  authorized
under this Indenture.

         (e) If at the time of the  mailing of any notice of  redemption  at the
option of the  Company,  the Company  shall not have  irrevocably  directed  the
Trustee  to apply  funds  then on  deposit  with the  Trustee  or held by it and
available to be used for the  redemption of Notes to redeem all the Notes called
for redemption,  such notice, at the election of the Company,  may state that it
is  conditional  and  subject  to the  receipt of the  redemption  moneys by the
Trustee on or before the date fixed for redemption and that such notice shall be
of no effect unless such moneys are so received on or before such date.

      Section 3.03  Payment Of Notes On Redemption; Deposit Of Redemption Price.
                    -----------------------------------------------------------

         (a) If notice of  redemption  for any Notes  shall  have been  given as
provided in Section  3.02 hereof and such notice  shall not contain the language
permitted at the Company's  option under Section 3.02(e)  hereof,  such Notes or
portions of Notes called for redemption shall become due and payable on the date
and at the places  stated in such  notice at the  applicable  redemption  price,
together with interest  accrued to the date fixed for  redemption of such Notes.
Interest on the Notes or portions

                                       23


<PAGE>


thereof  so  called  for  redemption  shall  cease to accrue  and such  Notes or
portions  thereof  shall be deemed not to be entitled to any benefit  under this
Indenture  except to  receive  payment of the  redemption  price  together  with
interest accrued thereon to the date fixed for redemption. Upon presentation and
surrender of such Notes at the place of payment  specified in such notice,  such
Notes or the  specified  portions  thereof  shall be paid  and  redeemed  at the
applicable  redemption price, together with interest accrued thereon to the date
fixed for redemption.

         (b) If notice  of  redemption  shall  have been  given as  provided  in
Section 3.02 hereof and such notice shall contain the language  permitted at the
Company's  option under Section 3.02(e) hereof,  such Notes or portions of Notes
called for redemption shall become due and payable on the date and at the places
stated in such notice at the applicable redemption price, together with interest
accrued to the date fixed for  redemption  of such  Notes,  and  interest on the
Notes or  portions  thereof so called for  redemption  shall cease to accrue and
such Notes or portions thereof shall be deemed not to be entitled to any benefit
under this Indenture  except to receive payment of the redemption price together
with interest  accrued thereon to the date fixed for redemption;  provided that,
in each case,  the  Company  shall have  deposited  with the Trustee or a paying
agent on or prior to 11:00 a.m.  New York City time on such  redemption  date an
amount  sufficient to pay the redemption price together with interest accrued to
the date fixed for  redemption.  Upon the Company  making such deposit and, upon
presentation  and  surrender  of such  Notes at such a place of  payment in such
notice specified, such Notes or the specified portions thereof shall be paid and
redeemed at the  applicable  redemption  price,  together with interest  accrued
thereon to the date fixed for  redemption.  If the  Company  shall not make such
deposit on or prior to the redemption date, the notice of redemption shall be of
no force and  effect  and the  principal  on such  Notes or  specified  portions
thereof shall  continue to bear interest as if the notice of redemption  had not
been given.

         (c) No  notice  of  redemption  of Notes  shall be  mailed  during  the
continuance of any Event of Default,  except (1) that, when notice of redemption
of any Notes has been  mailed,  the Company  shall redeem such Notes but only if
funds  sufficient for that purpose have prior to the occurrence of such Event of
Default been deposited with the Trustee or a paying agent for such purpose,  and
(2) that notices of redemption of all Outstanding  Notes may be given during the
continuance of an Event of Default.

         (d) Upon surrender of any Note redeemed in part only, the Company shall
execute, and the Trustee shall authenticate, deliver and register, a new Note or
Notes of authorized

                                       24


<PAGE>


denominations in aggregate principal amount equal to, and having the same terms,
Original Issue Date or Dates and series as, the  unredeemed  portion of the Note
so surrendered.

                                   ARTICLE IV

                  SATISFACTION AND DISCHARGE; UNCLAIMED MONEYS

         Section 4.01  Satisfaction And Discharge.
                       --------------------------

                  (a)  If at any time:

                  (1) the  Company  shall  have  paid or  caused  to be paid the
         principal of and premium,  if any, and interest on all the  Outstanding
         Notes, as and when the same shall have become due and payable,

                  (2) the Company shall have delivered to the Trustee for
         cancellation all Outstanding Notes, or

                  (3) the Company shall have irrevocably  deposited or caused to
         be  irrevocably  deposited  with the  Trustee as trust funds the entire
         amount in (A) cash,  (B) U.S.  Government  Obligations  maturing  as to
         principal and interest in such amounts and at such times as will insure
         the  availability  of  cash,  or (C) a  combination  of cash  and  U.S.
         Government Obligations,  in any case sufficient,  without reinvestment,
         as  certified  by an  independent  public  accounting  firm of national
         reputation in a written certification  delivered to the Trustee, to pay
         at maturity or the applicable  redemption date (provided that notice of
         redemption  shall  have  been  duly  given  or  irrevocable   provision
         satisfactory to the Trustee shall have been duly made for the giving of
         any notice of redemption) all Outstanding  Notes,  including  principal
         and any premium, if any, and interest due or to become due to such date
         of maturity,  as the case may be, and, unless all Outstanding Notes are
         to be due within 90 days of such deposit by  redemption  or  otherwise,
         shall  also  deliver to the  Trustee  an  opinion of counsel  expert in
         federal  income tax matters to the effect that the Company has received
         from, or there has been  published by, the Internal  Revenue  Service a
         ruling or similar pronouncement by the Internal Revenue Service or that
         there  has  been  a  change  of law  (collectively,  an  "External  Tax
         Pronouncement"),  in either  case to the effect that the Holders of the
         Notes will not recognize  income,  gain or loss for federal  income tax
         purposes as a result of such defeasance or discharge of the Indenture,

                                       25


<PAGE>


         and if, in any such case, (x) the Company shall also pay or cause to be
         paid all  other  sums  payable  hereunder  by the  Company  and (y) the
         Company has  delivered to the Trustee an Officers'  Certificate  and an
         Opinion of Counsel each stating that all  conditions  precedent  herein
         provided  for  relating  to the  satisfaction  and  discharge  of  this
         Indenture have been complied with,  then this Indenture  shall cease to
         be of  further  effect  (except  as to (i)  rights of  registration  of
         transfer  and  exchange  of  Notes,  (ii)  substitution  of  mutilated,
         defaced,  destroyed,  lost or stolen Notes, (iii) rights of Noteholders
         to receive payments of principal thereof,  and any premium and interest
         thereon,  upon the  original  stated  due  dates  therefor  or upon the
         applicable redemption date (but not upon acceleration of maturity) from
         the moneys and U.S. Government Obligations held by the Trustee pursuant
         to Section 4.02 hereof,  (iv) the rights and  immunities of the Trustee
         hereunder,  (v) the  obligations of the Company under Sections 5.02 and
         5.03  hereof,  (vi) the  obligations  and rights of the Trustee and the
         Company under Section 4.04 hereof,  and (vii) the duties of the Trustee
         with respect to any of the foregoing),  and the Company shall be deemed
         to have paid and discharged the entire indebtedness represented by, and
         its obligations  under,  the Notes,  and the Trustee,  on demand of the
         Company  and at the cost and  expense  of the  Company,  shall  execute
         proper  instruments  acknowledging  such  satisfaction and discharge of
         this  Indenture  and the  Trustee  shall at the  request of the Company
         return to the  Company  all  property  and money  held by it under this
         Indenture and determined by it from time to time in accordance with the
         certification  pursuant to this Section  4.01(a)(3)  to be in excess of
         the amount required to be held under this Section.

                  If the Notes are deemed to be paid and discharged  pursuant to
Section 4.01(a)(3) hereof,  within 60 days after those Notes are so deemed to be
paid and  discharged,  the Trustee  shall cause a written  notice to be given to
each Holder in the manner provided by Section 14.10 hereof. The notice shall:

                  (i) state that the Notes are deemed to be paid and discharged;

                  (ii)  set forth a description of any U.S. Government
Obligations and cash held by the Trustee as described above;

                  (iii) if any Notes will be called for redemption,  specify the
date or dates on which those Notes are to be called for redemption.

                                       26


<PAGE>


                  Notwithstanding   the   satisfaction  and  discharge  of  this
Indenture,  the  obligations  of the Company to the Trustee  under  Section 8.06
hereof shall survive.

         (b) If the Company  shall have paid or caused to be paid the  principal
of and premium,  if any,  and  interest on any Note,  as and when the same shall
have become due and payable or the Company  shall have  delivered to the Trustee
for cancellation  any Outstanding  Note, such Note shall cease to be entitled to
any lien or benefit under this Indenture.

         (c) If the Company  makes the  deposit of cash  and/or U.S.  Government
Obligations  with  respect to one or more series of Notes  described  in Section
4.01(a) hereof and otherwise  complies with the requirements of such Section for
the  satisfaction  and discharge of this  Indenture  (except that the opinion of
counsel  referred to in Section  4.01(a)(3) need not be based on an External Tax
Pronouncement, and shall be to the effect that the Holders of the Notes will not
recognize  income,  gain or loss for federal  income tax purposes as a result of
such deposit and the release of the Company from its obligations  referred to in
this  Section  4.01(c)  under  this  Indenture),  then  the  provisions  of this
Indenture shall remain in full force and effect and the indebtedness represented
by, and the Company's  obligations  under, such Notes shall be deemed satisfied,
the  Company  shall be  released  with  respect to such series of Notes from its
obligations under Sections 5.06, 5.07, 5.08, 5.09 and Article XI hereof.

         Section 4.02 Deposited  Moneys To Be Held In Trust By Trustee.  Subject
to Section 4.04, all moneys and U.S. Government  Obligations  deposited with the
Trustee  pursuant to Section 4.01 hereof,  shall be held in trust and applied by
it to the payment,  either  directly or through any paying agent  (including the
Company if acting as its own paying  agent),  to the  Holders of the  particular
Notes for the payment or  redemption  of which such  moneys and U.S.  Government
Obligations  have been  deposited with the Trustee of all sums due and to become
due thereon for principal and premium, if any, and interest.

         Section 4.03 Paying Agent To Repay Moneys Held.  Upon the  satisfaction
and discharge of this Indenture all moneys then held by any paying agent for the
Notes (other than the Trustee)  shall,  upon written  demand by the Company,  be
repaid to the Company or paid to the Trustee,  and  thereupon  such paying agent
shall be released from all further obligations with respect to such moneys.

                                       27


<PAGE>


         Section 4.04 Return Of Unclaimed  Moneys.  Any moneys deposited with or
paid to the Trustee for payment of the  principal  of or any premium or interest
on any Notes and not  applied  but  remaining  unclaimed  by the Holders of such
Notes for two years after the date upon which the principal of or any premium or
interest on such Notes,  as the case may be,  shall have become due and payable,
shall be repaid to the Company,  subject to applicable  abandoned property laws,
by the Trustee on written  demand by the Company;  and any Holder of any of such
Notes shall  thereafter  look only to the  Company  for any  payment  which such
Holder may be entitled to collect.

                                    ARTICLE V

                       PARTICULAR COVENANTS OF THE COMPANY

         Section 5.01 Payment Of Principal And Interest.  The Company  covenants
and  agrees for the  benefit  of the  Holders of the Notes that it will duly and
punctually  pay or  cause  to be  paid  the  principal  of and any  premium  and
interest,  if any, on, each of the Notes at the places,  at the respective times
and in the manner provided in such Notes or in this Indenture.

         Section  5.02  Offices  For  Payments,  Etc.  So long as any  Notes are
Outstanding  hereunder,  the Company will  maintain in the Borough of Manhattan,
The City of New York,  State of New York an office or agency where the Notes may
be presented  for payment,  for exchange as in this  Indenture  provided and for
registration  of transfer as in this  Indenture  provided.  The Corporate  Trust
Office of the Trustee shall serve as the initial location of such office.

         The Company will maintain in the Borough of Manhattan,  The City of New
York, State of New York an office or agency where notices and demands to or upon
the  Company  in  respect  of the Notes or this  Indenture  may be  served.  The
Corporate  Trust  Office of the Trustee  shall serve as the initial  location of
such office.

         In case the  Company  shall  fail to  maintain  any  office  or  agency
required by this Section to be located in the Borough of Manhattan,  The City of
New York, State of New York or shall fail to give such notice of the location or
of  any  change  in the  location  of any of  the  above  offices  or  agencies,
presentations and demands may be made and notices may be served at the Corporate
Trust Office of the Trustee,  and, in such event,  the Trustee  shall act as the
Company's  agent to receive  all such  presentations,  surrenders,  notices  and
demands.

                                       28


<PAGE>


         The  Company  may from time to time  designate  one or more  additional
offices or agencies  where the Notes may be presented for payment,  for exchange
as in this  Indenture  provided  and for  registration  of  transfer  as in this
Indenture  provided,  and the  Company  may from time to time  rescind  any such
designation;  provided, however, that no such designation or rescission shall in
any manner  relieve the  Company of its  obligation  to  maintain  any office or
agency provided for in this Section. The Company will give to the Trustee prompt
written notice of any such  designation or rescission  thereof and of any change
in the location of any such other office or agency.

         Section 5.03  Appointment  To Fill A Vacancy In Office Of Trustee.  The
Company, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint,  in the manner provided in Section 8.11, a Trustee,  so that there
shall at all times be a Trustee hereunder.

         Section 5.04  Provision As To Paying  Agent.  The Trustee  shall be the
paying  agent for the Notes and, at the option of the  Company,  the Company may
appoint additional paying agents (including without limitation itself). Whenever
the Company  shall appoint a paying agent other than the Trustee with respect to
the Notes, it will cause such paying agent to execute and deliver to the Trustee
an instrument  in which such agent shall agree with the Trustee,  subject to the
provisions of this Section:

                  (1) that such paying  agent will hold all sums  received by it
         as such agent for the payment of the principal of, premium,  if any, or
         interest,  on the Notes  (whether such sums have been paid to it by the
         Company or by any other  obligor on the Notes) in trust for the benefit
         of the Holders of the Notes, or of the Trustee until such sums shall be
         paid to such Holders or otherwise disposed of as herein provided;

                  (2) that such paying agent will give the Trustee notice of any
         failure by the Company  (or by any other  obligor on Notes) to make any
         payment of the principal of, premium,  if any, or interest on the Notes
         when the same shall be due and payable; and

                  (3)  that  such  paying  agent  will at any  time  during  the
         continuance  of any such  failure,  upon  the  written  request  of the
         Trustee, forthwith pay to the Trustee all sums so held in trust by such
         paying agent.

                  The  Company  will,  on or  prior  to  each  due  date  of the
principal of and any premium, if any, or interest on the Notes, deposit with the
paying agent a sum sufficient to pay such

                                       29


<PAGE>


principal  and any premium or interest so becoming  due,  such sum to be held in
trust for the benefit of the Holders of the Notes  entitled to such principal of
and any premium or  interest,  and (unless such paying agent is the Trustee) the
Company will promptly notify the Trustee of any failure to take such action.

                  If the Company  shall act as its own paying agent with respect
to the  Notes,  it will,  on or before  each due date of the  principal  of (and
premium,  if any,) or interest,  if any, on the Notes, set aside,  segregate and
hold in trust for the benefit of the Holders of the Notes,  a sum  sufficient to
pay such principal (and premium,  if any,) or interest,  if any, so becoming due
until such sums shall be paid to such Holders or otherwise disposed of as herein
provided.  The Company will  promptly  notify the Trustee of any failure to take
such action.

                  The  Company  may at any  time  pay or cause to be paid to the
Trustee all sums held in trust by it or any paying agent hereunder,  as required
by this  Section,  such sums to be held by the  Trustee  upon the trusts  herein
contained,  and,  upon such  payment by any paying  agent to the  Trustee,  such
paying agent shall be released from all further  liability  with respect to such
money.

                  Anything in this Section to the contrary notwithstanding,  the
agreement  to hold sums in trust as provided  in this  Section is subject to the
provisions of Sections 4.03 and 4.04.

         Section 5.05 Certificates And Notice To Trustee.  The Company shall, on
or before  April 1, of each  year,  commencing  April 1,  2000,  deliver  to the
Trustee a certificate from its principal executive officer,  principal financial
officer or principal accounting officer covering the preceding calendar year and
stating  whether or not,  to the  knowledge  of such  Person,  the  Company  has
complied with all conditions and covenants  under this  Indenture,  and, if not,
describing  in  reasonable  detail any failure by the Company to comply with any
such conditions or covenants. For purposes of this Section,  compliance shall be
determined  without  regard  to any  period  of grace or  requirement  of notice
provided under this Indenture.

         Section  5.06  Restrictions  On  Liens  (a) So  long as any  Notes  are
Outstanding,  the Company will not issue,  assume,  guarantee or permit to exist
any Debt secured by any Lien on any Operating  Property of the Company,  whether
owned at the date of this Indenture or thereafter acquired,  without in any such
case effectively  securing the Outstanding  Notes (together with, if the Company
shall so  determine,  any other Debt of or  guaranteed  by the  Company  ranking
equally with, the Notes) equally and ratably

                                       30


<PAGE>


with such Debt (but only so long as such Debt is so secured); provided, however,
that the  foregoing  restriction  shall not apply to Debt  secured by any of the
following:

                  (i)......Liens on any Operating  Property existing at the time
of  acquisition  thereof  (which  Liens may also extend to  subsequent  repairs,
alterations and improvements to such Operating Property);

                  (ii).....Liens on operating property of a corporation existing
at the time such corporation is merged into or consolidated with the Company, or
at the time of a sale,  lease,  or other  disposition  of the properties of such
corporation or a division thereof as an entirety or substantially as an entirety
to the Company;

                  (iii)....Liens on Operating  Property to secure all or part of
the cost of acquiring,  constructing,  developing,  or substantially  repairing,
altering,  or improving such  property,  or to secure  indebtedness  incurred to
provide  funds for any such  purpose or for  reimbursement  of funds  previously
expended  for any such  purpose,  provided  such  Liens are  created  or assumed
contemporaneously  with, or within eighteen (18) months after,  such acquisition
or  the  completion  of  construction,   development,   or  substantial  repair,
alteration or improvement;

                  (iv).....Liens  in  favor  of any  State,  or any  department,
agency,  or  instrumentality  or political  subdivision of any State, or for the
benefit of holders of  securities  issued by any such  entity (or  providers  of
credit  enhancement  with  respect  to such  securities),  to  secure  any  Debt
(including,  without  limitation,  obligations  of the Company  with  respect to
industrial development, pollution control or similar revenue bonds) incurred for
the purpose of financing  all or any part of the  purchase  price or the cost of
constructing,  developing,  or substantially  repairing,  altering, or improving
Operating Property of the Company;

                  (v)   Liens  under the First Mortgage,  where such Debt has
been issued for purposes of any transaction described in (iv) above;

                  (vi)  Liens under Section 8.06 hereof; or

                  (vii) Any extension,  renewal or replacement (or successive
extensions,  renewals,  or  replacements),  in  whole  or in  part,  of any Lien
referred to in the foregoing clauses (i) to (vi), inclusive;  provided, however,
that the principal  amount of Debt secured thereby and not otherwise  authorized
by said clauses (i) to (vi), inclusive, shall not exceed the principal amount of

                                       31


<PAGE>


Debt,  plus any premium or fee payable in  connection  with any such  extension,
renewal, or replacement,  so secured at the time of such extension,  renewal, or
replacement.

         (b) Notwithstanding the provisions of Section 5.06(a),  the Company may
issue,  assume,  or guarantee  Debt,  or permit to exist any Debt, in each case,
secured by Liens which would otherwise be subject to the restrictions of Section
5.06(a) up to an aggregate  principal  amount that,  together with the principal
amount of all other  Debt of the  Company  secured  by Liens  (other  than Liens
permitted  by  Section  5.06(a)  that would  otherwise  be subject to any of the
foregoing restrictions) and the Value of all Sale and Lease-Back Transactions in
existence at such time (other than any Sale and Lease-Back  Transaction that, if
such Sale and Lease-Back  Transaction had been a Lien, would have been permitted
by Section  5.06(a),  other than Sale and Lease-Back  Transactions  permitted by
Section  5.07  because  the  commitment  by or on  behalf of the  purchaser  was
obtained no later than eighteen (18) months after the later of events  described
in (i) or (ii) of Section 5.07, and other than Sale and Lease-Back  Transactions
as to which  application of amounts have been made in accordance with clause (z)
of Section  5.07),  does not at the time exceed the  greater of fifteen  percent
(15%) of Tangible Assets or fifteen percent (15%) of Capitalization.

         (c) If the Company shall issue,  assume,  or guarantee any Debt secured
by any Lien and if  Section  5.06(a)  requires  that  the  Outstanding  Notes be
secured  equally and ratably with such Debt, the Company will promptly  execute,
at its expense,  any instruments  necessary to so equally and ratably secure the
Outstanding Notes and deliver the same to the Trustee along with:

                  (i)  An Officers' Certificate stating that the covenant of the
Company contained in Section 5.06(a) has been complied with; and

                  (ii) An Opinion of Counsel to the effect  that the Company has
complied  with  the  covenant  contained  in  Section  5.06(a),   and  that  any
instruments  executed by the Company in the  performance of such covenant comply
with the requirements of such covenant.

                  In  the  event  that  the  Company  shall   hereafter   secure
Outstanding  Notes equally and ratably with any other obligation or indebtedness
pursuant to the  provisions  of this Section 5.06,  the Company  will,  upon the
request of the Trustee, enter into an indenture or agreement supplemental hereto
and take such other  action,  if any, as the Trustee may  reasonably  request to
enable it to enforce effectively the rights of the Holders of

                                       32


<PAGE>


Outstanding Notes so secured,  equally and ratably with such other obligation or
indebtedness.

         Section 5.07 Restrictions On Sale And Lease-Back Transactions.  So long
as any Notes are Outstanding, the Company will not enter into or permit to exist
any Sale and Lease-Back  Transaction with respect to any Operating  Property if,
in any case,  the  commitment  by or on behalf of the purchaser is obtained more
than  eighteen  (18)  months  after  the  later  of (i)  the  completion  of the
acquisition, construction, or development of such Operating Property or (ii) the
placing in operation of such Operating Property or of such Operating Property as
constructed,  developed, or substantially repaired, altered, or improved, unless
(x) the Company would be entitled pursuant to Section 5.06(a) to issue,  assume,
guarantee or permit to exist Debt secured by a Lien on such  Operating  Property
without  equally and  ratably  securing  the Notes or (y) the  Company  would be
entitled  pursuant  to Section  5.06(b),  after  giving  effect to such Sale and
Lease-Back  Transaction,  to incur  $1.00 of  additional  Debt  secured by Liens
(other than Liens  permitted by Section  5.06(a)) or (z) the Company shall apply
or cause to be applied,  in the case of a sale or transfer  for cash,  an amount
equal to the net  proceeds  thereof  (but not in excess of the net book value of
such  Operating  Property at the date of such sale or transfer) and, in the case
of a sale or transfer otherwise than for cash, an amount equal to the fair value
(as  determined by the Board of Directors) of the Operating  Property so leased,
to the retirement, within one hundred eighty (180) days after the effective date
of such Sale and  Lease-Back  Transaction,  of Notes (in  accordance  with their
terms) or other Debt of the  Company  ranking  senior to, or equally  with,  the
Notes;  provided,  however,  that the amount to be applied to such retirement of
Debt shall be  reduced  by an amount  equal to the  principal  amount,  plus any
premium or fee paid in connection  with any  redemption  in accordance  with the
terms of Debt voluntarily  retired by the Company within such one hundred eighty
(180) day period,  excluding  retirement  pursuant to mandatory  sinking fund or
prepayment provisions and payments at maturity.

         Section 5.08 Corporate Existence.  Subject to the rights of the Company
under Article XII, the Company shall do or cause to be done all things necessary
to preserve and keep in full force and effect its corporate existence; provided,
however,  that the Company  shall not be required to preserve  any such right or
franchise  if, in the judgment of the Company,  the  preservation  thereof is no
longer desirable in the conduct of the business of the Company.

                                       33


<PAGE>


         Section 5.09 Issuance of Additional  First  Mortgage  Bonds.  After the
issuance  of the  first  series  of  Notes,  the  Company  shall  not  issue any
additional First Mortgage Bonds under the First Mortgage.


                                   ARTICLE VI

                         NOTEHOLDER LISTS AND REPORTS BY

                           THE COMPANY AND THE TRUSTEE

         Section 6.01 Company To Furnish  Noteholder  Lists. The Company and any
other obligor on the Notes shall furnish or cause to be furnished to the Trustee
a list in such  form as the  Trustee  may  reasonably  require  of the names and
addresses of the Holders of the Notes:

         (a)  semi-annually  and not more than 15 days after each Regular Record
Date for each  Interest  Payment  Date that is not a maturity  date,  as of such
Regular Record Date, and such list need not include  information  received after
such date; and

         (b) at such other times as the  Trustee may request in writing,  within
30 days after receipt by the Company of any such request,  as of a date not more
than 15 days prior to the time such information is furnished, and such list need
not include information received after such date;

provided  that if and so long as the  Trustee  shall  be the  registrar  for the
Notes, such list shall not be required to be furnished.

         Section 6.02  Preservation And Disclosure Of Noteholder 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 the
Notes (i)  contained  in the most recent  lists  furnished  to it as provided in
Section 6.01, (ii) received by it in the capacity of registrar for the Notes, if
so acting,  and (iii) filed with it within the two preceding  years  pursuant to
Section 6.04(d)(2). The Trustee may destroy any list furnished to it as provided
in Section 6.01 upon receipt of a new list so furnished.

         (b) In case three or more Holders of Notes (hereinafter  referred to as
"applicants")  apply in  writing  to the  Trustee  and  furnish  to the  Trustee
reasonable  proof that each such  applicant  has owned a Note for a period of at
least six months  preceding the date of such  application,  and such application
states that the applicants desire to communicate with other Holders of Notes

                                       34


<PAGE>


with respect to their  rights  under this  Indenture or under the Notes and such
application is accompanied by a copy of the form of proxy or other communication
which such applicants propose to transmit,  then the Trustee shall,  within five
Business Days after the receipt of such application, at its election, either

                  (i)  afford  to  such  applicants  access  to the  information
preserved  at the time by the  Trustee  in  accordance  with the  provisions  of
subsection (a) of this Section; or

                  (ii) inform such  applicants as to the  approximate  number of
Holders whose names and  addresses  appear in the  information  preserved at the
time by the Trustee.  in accordance  with the provisions of such  subsection (a)
and as to the  approximate  cost of mailing to such Holders the form of proxy or
other communication, if any, specified in such application.

                  If the Trustee  shall  elect not to afford to such  applicants
access to such information,  the Trustee shall, upon the written request of such
applicants,  mail to each Holder of Notes, whose name and address appears in the
information  preserved  at the  time  by the  Trustee  in  accordance  with  the
provisions  of  such  subsection  (a) a copy  of the  form  of  proxy  or  other
communication  which is specified in such request,  with  reasonable  promptness
after a tender to the Trustee of the  material  to be mailed and of payment,  or
provision for the payment, of the reasonable expenses of mailing,  unless within
five days after such tender the Trustee shall mail to such  applicants  and file
with the  Commission,  together  with a copy of the  material  to be  mailed,  a
written  statement  to the effect  that,  in the  opinion of the  Trustee,  such
mailing  would be contrary to the best  interests  of the Holders or would be in
violation of applicable  law. Such written  statement shall specify the basis of
such  opinion.  If the  Commission,  after  opportunity  for a hearing  upon the
objections  specified in the written  statement  so filed,  shall enter an order
refusing to sustain any of such  objections  or if,  after the entry of an order
sustaining  one or more of such  objections,  the Commission  shall find,  after
notice and  opportunity  for hearing,  that all the objections so sustained have
been met, and shall enter an order so  declaring,  the Trustee shall mail copies
of such material to all such Holders with reasonable  promptness after the entry
of such order and the renewal of such  tender;  otherwise  the Trustee  shall be
relieved  of  any  obligation  or  duty  to  such  applicants  respecting  their
application.

         (c) Each and every Holder of a Note, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of the Company or the Trustee shall be held  accountable by reason
of the

                                       35


<PAGE>


disclosure of any such  information as to the names and addresses of the Holders
of Notes in accordance  with the  provisions of subsection  (b) of this Section,
regardless of the source from which such  information was derived,  and that the
Trustee shall not be held accountable by reason of mailing any material pursuant
to a request made under such subsection (b).

         Section 6.03  Reports By The Company. The Company shall:
                       ----------------------

         (a) file with the Trustee, within 15 days after the Company is required
to file the same with the  Commission,  copies of the annual  reports and of the
information,  documents  and other reports (or copies of such portions of any of
the foregoing as the Commission  may from time to time by rules and  regulations
prescribe)  which  the  Company  may be  required  to file  with the  Commission
pursuant to Section 13 or Section 15(d) of the Securities  Exchange Act of 1934;
or, if the Company is not  required to file  information,  documents  or reports
pursuant to either of said Sections,  then it will file with the Trustee and the
Commission,  in accordance  with rules and  regulations  prescribed from time to
time by the  Commission,  such of the  supplementary  and periodic  information,
documents  and  reports  which may be  required  pursuant  to  Section 13 of the
Securities  Exchange Act of 1934 in respect of a security  listed and registered
on a national securities exchange as may be prescribed from time to time in such
rules and regulations;

         (b) file with the Trustee and the Commission,  in accordance with rules
and regulations prescribed from time to time by the Commission,  such additional
information,  documents  and reports with respect to  compliance  by the Company
with the conditions and covenants of this Indenture as may be required from time
to time by such rules and regulations; and

         (c) transmit by mail to all Holders of Notes,  within 30 days after the
filing  thereof  with the  Trustee in the manner and to the extent  provided  in
Section  6.04(d),  such  summaries  of any  information,  documents  and reports
required to be filed by the Company  pursuant to paragraphs  (a) and (b) of this
Section as may be required by rules and regulations prescribed from time to time
by the Commission.

         Section 6.04  Reports By The Trustee.
                       ----------------------

         (a) Annually,  not later than August 15 of each year, the Trustee shall
transmit by mail a brief report dated as of such date that complies with Section
313(a) of the TIA (to the extent required by such Section).

                                       36


<PAGE>


         (b) The Trustee  shall from time to time transmit by mail brief reports
that comply,  both in content and date of delivery,  with Section  313(b) of the
TIA (to the extent required by such Section).

         (c) A copy of each such report filed pursuant to this section shall, at
the time of such transmission to such Holders, be filed by the Trustee with each
stock exchange upon which any Notes are listed and also with the Commission. The
Company  will  notify the Trustee  promptly in writing  upon the listing of such
Notes on any stock exchange.

         (d)  Reports pursuant to this Section shall be transmitted

                  (1)    by mail to all Holders of Notes, as their names and
         addresses appear in the register for the Notes;

                  (2) by mail to such  Holders of Notes as have,  within the two
         years preceding such transmission, filed their names and addresses with
         the Trustee for such purpose;

                  (3) by mail, except in the case of reports pursuant to Section
         6.04(b)  and (c)  hereof,  to all  Holders  of Notes  whose  names  and
         addresses have been furnished to or received by the Trustee pursuant to
         Section 6.01 and 6.02(a)(ii) hereof; and

                  (4) at the time such report is  transmitted  to the Holders of
         the Notes, to each exchange on which Notes are listed and also with the
         Commission.

                                   ARTICLE VII

                     REMEDIES OF THE TRUSTEE AND NOTEHOLDERS

                              ON EVENTS OF DEFAULT

         Section 7.01  Events Of Default.
                       -----------------

         (a)  If one or more of the following Events of Default shall have
occurred and be continuing:

                  (1) default in the payment of any installment of interest upon
         any of the  Notes  as and  when the same  shall  due and  payable,  and
         continuance of such default for a period of sixty (60) days;

                  (2)    default in the payment of the principal of or any
         premium on any of the Notes as and when the same shall become due and
         payable;



                                       37


<PAGE>


                           (3)  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 contained in the Notes or in this Indenture for a period
         of ninety (90) days after the date on which written  notice  specifying
         such  failure,  stating  that  such  notice is a  "Notice  of  Default"
         hereunder and demanding  that the Company  remedy the same,  shall have
         been given to the Company by the Trustee by registered  mail, or to the
         Company  and  the  Trustee  by the  Holders  of not  less  than  33% in
         aggregate principal amount of the Notes at the time Outstanding;

                  (4) a court having  jurisdiction in the premises shall enter a
         decree or order for relief in respect of the Company in an  involuntary
         case under any applicable  bankruptcy,  insolvency or other similar law
         now or  hereafter  in  effect,  adjudging  the  Company a  bankrupt  or
         insolvent,   or  approving  as  properly   filed  a  petition   seeking
         reorganization, arrangement, adjustment or composition of or in respect
         of the Company  under any  applicable  law, or  appointing  a receiver,
         liquidator,  assignee,  custodian,  trustee or sequestrator (or similar
         official) of the Company or for any substantial part of the property of
         the Company,  or ordering the winding up or  liquidation of the affairs
         of the Company,  and such decree or order shall remain  unstayed and in
         effect for a period of 90 consecutive days; or

                  (5) the Company shall  commence a voluntary case or proceeding
         under any applicable  bankruptcy,  insolvency,  reorganization or other
         similar law now or hereafter in effect or any other case or  proceeding
         to be adjudicated a bankrupt or insolvent, or consent to the entry of a
         decree or order for relief in an  involuntary  case under any such law,
         or to  the  commencement  of  any  bankruptcy  or  insolvency  case  or
         proceeding  against  it, or the filing by it of a petition or answer or
         consent seeking  reorganization  or relief under any applicable law, or
         consent to the filing of such petition or to the  appointment or taking
         possession by a receiver,  liquidator,  assignee, custodian, trustee or
         sequestrator   (or  similar   official)  of  the  Company  or  for  any
         substantial  part of the property of the  Company,  or make any general
         assignment for the benefit of creditors, or the notice by it in writing
         of its inability to pay its debts  generally as they become due, or the
         taking of any  corporate  action by the Company in  furtherance  of any
         such action;

then, unless the principal of all of the Notes shall have already become due and
payable,  either the Trustee or the Holders of a majority in aggregate principal
amount of the Notes then  Outstanding,  by notice in writing to the Company (and
to the

                                       38


<PAGE>


Trustee if given by such Holders), may declare the principal of all the Notes to
be due and  payable  immediately  and upon any such  declaration  the same shall
become  immediately due and payable,  anything in this Indenture or in the Notes
contained to the contrary notwithstanding.

                  The foregoing paragraph,  however, is subject to the condition
that if,  at any time  after  the  principal  of the  Notes  shall  have been so
declared due and  payable,  and before any judgment or decree for the payment of
the moneys due shall have been obtained or entered as hereinafter provided,  the
Company shall pay or shall deposit with the Trustee a sum  sufficient to pay all
matured  installments of interest upon all of the Notes and the principal of and
any premium on any and all Notes 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 and  applicable  premium at the rate borne by the Notes to the date of
such payment or deposit) and all sums paid or advanced by the Trustee hereunder,
the  reasonable  compensation,  expenses,  disbursements  and  advances  of  the
Trustee,  its agents and counsel,  and any other  amounts due the Trustee  under
Section 8.06 hereof,  and any and all defaults under this Indenture,  other than
the  non-payment of principal of and accrued  interest on Notes which shall have
become due solely by acceleration  of maturity,  shall have been cured or waived
-- then and in every such case such payment or deposit  shall cause an automatic
waiver of the Event of Default and its consequences and shall cause an automatic
rescission and annulment of the acceleration of the Notes; but no such waiver or
rescission and annulment shall extend to or shall affect any subsequent default,
or shall impair any right consequent thereon.

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

                                       39


<PAGE>


    Section 7.02  Collection Of Indebtedness By Trustee; Trustee May Prove Debt.
                  -------------------------------------------------------------

         (a) The  Company  covenants  that if an Event of Default  described  in
clause (a)(1) or (a)(2) of Section 7.01 shall have  occurred and be  continuing,
then, upon demand of the Trustee,  the Company shall pay to the Trustee, for the
benefit of the  Holders of the Notes,  the whole  amount that then shall have so
become due and payable on all such Notes for principal or interest,  as the case
may be, with  interest  upon the overdue  principal  and any premium 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 Notes;  and, in
addition thereto, such further amounts as shall be sufficient to cover the costs
and expenses of collection,  including  reasonable  compensation to the Trustee,
its agents,  attorneys and counsel,  any expenses or liabilities incurred by the
Trustee  hereunder  other than through its  negligence or bad faith.  Until such
demand is made by the Trustee, the Company may pay the principal of and interest
on the Notes to the Holders, whether or not the Notes be overdue.

         (b) 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 enforce
any such  judgment or final decree  against the Company or any other  obligor on
the Notes and collect in the manner  provided by law out of the  property of the
Company or any other  obligor on such  series of Notes  wherever  situated,  the
moneys adjudged or decreed to be payable.

         (c) In case there shall be pending proceedings  relative to the Company
or any other  obligor upon the Notes under Title 11 of the United States Code or
any other applicable  Federal or state  bankruptcy,  insolvency or other similar
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 its property or such other  obligor,  or in
case of any other  comparable  judicial  proceedings  relative to the Company or
such other obligor, or to the creditors or property of the Company or such other
obligor,  the Trustee,  irrespective of whether the principal of the Notes 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, shall be entitled and empowered,  by intervention in
such proceedings or otherwise:

                                       40


<PAGE>


                  (1) to file and prove a claim or claims  for the whole  amount
         of the principal and interest owing and unpaid in respect of the Notes,
         and to file such  other  papers or  documents  as may be  necessary  or
         advisable  in order to have the claims of the  Trustee  (including  any
         amounts  due to the  Trustee  under  Section  8.06  hereof)  and of the
         Noteholders allowed in any judicial proceedings relative to the Company
         or such other  obligor,  or to the creditors or property of the Company
         or such other obligor; and

                  (2) to  collect  and  receive  any  moneys  or other  property
         payable  or  deliverable  on any such  claims,  and to  distribute  all
         amounts  received with respect to the claims of the  Noteholders and of
         the Trustee on their  behalf;  and any trustee,  receiver,  liquidator,
         custodian or other similar official is hereby authorized by each of the
         Noteholders to make payments to the Trustee, and, in the event that the
         Trustee  shall  consent to the making of the  payments  directly to the
         Noteholders, to pay to the Trustee such amounts due pursuant to Section
         8.06 hereof.

         (d) Nothing herein  contained  shall be deemed to authorize the Trustee
to  authorize  or  consent  to or vote for or  accept  or adopt on behalf of any
Holder  any  plan of  reorganization,  arrangement,  adjustment  or  composition
affecting  the Notes of any series or the rights of any  Holder  thereof,  or to
authorize  the Trustee to vote in respect of the claim of any Holder in any such
proceeding except to vote for the election of a trustee in bankruptcy or similar
person.

         (e) All rights of action and of asserting  claims under this Indenture,
or under any of the Notes may be prosecuted and enforced by the Trustee  without
the  possession  of any of the Notes or the  production  thereof at any trial or
other  proceedings   relative  thereto,  and  any  such  action  or  proceedings
instituted  by the  Trustee  shall be  brought  in its own name as trustee of an
express  trust,  and any  recovery  of  judgment,  subject to the payment of the
expenses,  disbursements  and  compensation  of  the  Trustee  and  its  agents,
attorneys  and counsel,  shall be for the ratable  benefit of the Holders of the
Notes in respect of which such action was taken.

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

                                       41


<PAGE>


         Section  7.03  Application  Of  Proceeds.  Any moneys  collected by the
Trustee  with  respect to any of the Notes  pursuant  to this  Article  shall be
applied in the  following  order,  at the date or dates fixed by the Trustee for
the  distribution of such moneys,  upon  presentation of the several Notes,  and
stamping thereon the payment, if only partially paid, and upon surrender thereof
if fully paid.

         FIRST: To the payment of all amounts due to the Trustee pursuant to
Section 8.06 hereof;

         SECOND:  In case the principal of the  Outstanding  Notes in respect of
which such moneys have been  collected  shall not have become due and be unpaid,
to the  payment of interest  on the Notes,  in the order of the  maturity of the
installments of such interest, with interest (to the extent allowed by law) upon
the  overdue  installments  of  interest  at the rate borne by the  Notes,  such
payments to be made  ratably to the persons  entitled  thereto,  and then to the
payment  to  the  Holders  entitled  thereto  of  the  unpaid  principal  of and
applicable  premium on any of the Notes  which shall have become due (other than
Notes previously  called for redemption for the payment of which moneys are held
pursuant to the provisions of this Indenture),  whether at stated maturity or by
redemption,  in the order of their due dates,  beginning  with the  earliest due
date, and if the amount available is not sufficient to pay in full all Notes due
on any particular  date, then to the payment thereof  ratably,  according to the
amounts of principal  and  applicable  premium due on that date,  to the Holders
entitled thereto, without any discrimination or privilege;

         THIRD:  In case the  principal of the  Outstanding  Notes in respect of
which such moneys have been  collected  shall have become due, by declaration or
otherwise,  to the  payment of the whole  amount  then owing and unpaid upon the
Notes for principal and any premium and interest  thereon,  with interest on the
overdue  principal  and any  premium  and (to the  extent  allowed  by law) upon
overdue  installments  of interest  at the rate borne by the Notes;  and in case
such moneys  shall be  insufficient  to pay in full the whole  amount so due and
unpaid upon the Notes, then to the payment of such principal and any premium and
interest  without  preference  or priority  of  principal  and any premium  over
interest, or of interest over principal and any premium or of any installment of
interest over any other  installment of interest,  or of any Note over any other
Note, ratably to the aggregate of such principal and any premium and accrued and
unpaid interest; and

                                       42


<PAGE>


         FOURTH: To the payment of the remainder, if any, to the Company or its
successors or assigns, or to whomsoever may lawfully be entitled to the same, or
as a court of competent jurisdiction may determine.

         Section 7.04  Limitations On Suits By Noteholders.
                       -----------------------------------

         (a) No  Holder  of any Note  shall  have any  right by  virtue of or by
availing of any  provision of this  Indenture to institute  any suit,  action or
proceeding  in equity or at law upon or under or with respect to this  Indenture
or for the  appointment  of a  receiver  or  trustee,  or for any  other  remedy
hereunder, unless such Holder previously shall have given to the Trustee written
notice of an Event of Default with  respect to such Note and of the  continuance
thereof, as hereinabove  provided,  and unless also Noteholders of a majority in
aggregate principal amount of the Notes then Outstanding  affected by such Event
of Default  shall have made written  request upon the Trustee to institute  such
action,  suit or proceeding in its own name as Trustee  hereunder and shall have
offered to the Trustee such  reasonable  indemnity as it may require against the
costs,  expenses  and  liabilities  to be incurred  therein or thereby,  and the
Trustee  for 60 days after its  receipt  of such  notice,  request  and offer of
indemnity, shall have neglected or refused to institute any such action, suit or
proceeding;  it being understood and intended, and being expressly covenanted by
the taker and  Holder of every Note with  every  other  taker and Holder and the
Trustee, that no one or more Holders of Notes shall have any right in any manner
whatever by virtue of or by  availing  of any  provision  of this  Indenture  to
affect,  disturb or  prejudice  the rights of any other  Holder of Notes,  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 Notes.  For the
protection and  enforcement  of the  provisions of this Section,  each and every
Noteholder  and the  Trustee  shall be  entitled  to such relief as can be given
either at law or in equity.

         (b) Notwithstanding any other provision in this Indenture, however, the
rights of any Holder of any Note to receive  payment of the principal of and any
premium  and  interest  on such  Note,  on or after  the  respective  due  dates
expressed in such Note or on the  applicable  redemption  date,  or to institute
suit for the enforcement of any such payment on or after such  respective  dates
are absolute and  unconditional,  and shall not be impaired or affected  without
the consent of such Holder.

         Section 7.05  Suits For Enforcement. In case an Event of Default has
                       ---------------------
occurred, has not been waived and is continuing hereunder, the Trustee may in
its discretion proceed to protect



                                       43


<PAGE>


and  enforce  the  rights  vested in it by this  Indenture  by such  appropriate
judicial  proceedings  as the Trustee  shall deem most  effectual to protect and
enforce any of such  rights,  either by suit in equity or by action at law or by
proceeding in bankruptcy or otherwise,  whether for the specific  enforcement of
any covenant or agreement  contained in this Indenture or in aid of the exercise
of any power granted to it under this  Indenture,  or to enforce any other legal
or equitable right vested in the Trustee by this Indenture or by law.

         Section  7.06 Powers And  Remedies  Cumulative;  Delay Or Omission  Not
Waiver Of Default.  No right or remedy herein  conferred upon or reserved to the
Trustee or to the  Holders of Notes is  intended  to be  exclusive  of any other
right or remedy,  and every right and remedy shall,  to the extent  permitted by
law,  be  cumulative  and in  addition  to every  other  right and remedy  given
hereunder or now or  hereafter  existing at law or in equity or  otherwise.  The
assertion or employment of any right or remedy  hereunder,  or otherwise,  shall
not prevent the  concurrent  assertion or  employment  of any other  appropriate
right or remedy.

         No  delay or  omission  of the  Trustee  or of any  Holder  of Notes to
exercise any right or power  accruing  upon any 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  Event of  Default  or an  acquiescence
therein;  and,  subject to Section  7.04,  every  right and power  given by this
Indenture  or by law to the Trustee or to the Holders of Notes may be  exercised
from time to time, and as often as shall be deemed expedient,  by the Trustee or
by the Holders of Notes, as the case may be.

         Section 7.07  Direction Of Proceedings And Waiver Of Defaults By
                       --------------------------------------------------
Majority Of Noteholders.
-----------------------


         (a) The  Holders of a majority  in  aggregate  principal  amount of the
Notes at the time Outstanding  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 such
direction  shall not be otherwise than in accordance with law and the provisions
of this  Indenture;  and provided  further that (subject to Section 8.01 hereof)
the Trustee shall have the right to decline to follow any such  direction if the
Trustee  being  advised by counsel  determines  that the action or proceeding so
directed  may not lawfully be taken or if the Trustee in good faith by its board
of directors or trustees, executive committee, or a trust committee of directors
or  trustees  or  Responsible  Officers  shall  determine  that  the  action  or
proceeding so directed would involve the Trustee in personal liability.  Nothing
in this  Indenture  shall impair the right of the Trustee in its  discretion  to
take

                                       44


<PAGE>


any action deemed proper by the Trustee and which is not inconsistent  with such
direction or directions by Noteholders.

         (b) The  Holders of a majority  in  aggregate  principal  amount of the
Notes at the time  Outstanding  may on behalf of all of the Holders of the Notes
waive any past default or Event of Default hereunder and its consequences except
a default in the  payment of  principal  of or any  premium or  interest  on the
Notes.  Upon any such  waiver the  Company,  the  Trustee and the Holders of the
Notes  shall be  restored  to  their  former  positions  and  rights  hereunder,
respectively, but no such waiver shall extend to any subsequent or other default
or Event of  Default  or impair  any  right  consequent  thereon.  Upon any such
waiver,  such default  shall cease to exist and be deemed to have been cured and
not to be continuing, and any Event of Default arising therefrom shall be deemed
to  have  been  cured  and  not to be  continuing,  for  every  purpose  of this
Indenture; 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 Default. The Trustee shall, within 90 days after
the  occurrence  of a default with respect to the Notes,  give to all Holders of
the Notes, in the manner provided in Section 14.10, notice of such default known
to the Trustee,  unless such default  shall have been cured or waived before the
giving of such notice,  the term  "default" for the purpose of this Section 7.08
being  hereby  defined to be any event which is or after notice or lapse of time
or both would become an Event of Default;  provided that,  except in the case of
default in the payment of the  principal of or any premium or interest on any of
the Notes,  the Trustee shall be protected in withholding  such notice if and so
long as its board of  directors  or trustees,  executive  committee,  or a trust
committee  of  directors  or  trustees  or  Responsible  Officers  in good faith
determines  that the  withholding  of such  notice  is in the  interests  of the
Holders of the Notes.

         Section 7.09  Undertaking  To Pay Costs.  All parties to this Indenture
agree, and each Holder of any Note by acceptance thereof shall be deemed to have
agreed,  that  any  court  may in its  discretion  require,  in any suit for the
enforcement  of any right or remedy under this  Indenture or in any suit against
the Trustee  for any action  taken,  suffered  or omitted by it as Trustee,  the
filing by any party  litigant in such suit of an undertaking to pay the costs of
such suit, and that such court may in its discretion  assess  reasonable  costs,
including  reasonable  attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such  party  litigant;  but  this  Section  7.09  shall  not  apply  to any suit
instituted by the Trustee, or to any suit

                                       45


<PAGE>


instituted by any Noteholder, or group of Noteholders,  holding in the aggregate
more  than 10% in  principal  amount of the  Notes  Outstanding,  or to any suit
instituted by any Noteholder for the enforcement of the payment of the principal
of or any premium or interest on any Note on or after the due date  expressed in
such Note or the applicable redemption date.

         Section 7.10  Restoration Of Rights On Abandonment Of  Proceedings.  In
case the Trustee or any Holder  shall have  proceeded to enforce any right under
this Indenture and such  proceedings  shall have been  discontinued or abandoned
for any reason,  or shall have been  determined  adversely  to the Trustee or to
such Holder,  then,  and in every such case,  the  Company,  the Trustee and the
Holders  shall be restored  respectively  to their former  positions  and rights
hereunder,  and all rights,  remedies and powers of the Company, the Trustee and
the Holders shall continue as though no such proceedings had been taken.

         Section  7.11  Waiver Of Usury,  Stay Or  Extension  Laws.  The Company
covenants  (to the extent  that it may  lawfully  do so) that it will not at any
time  insist  upon,  or plead,  or in any  manner  whatsoever  claim or take the
benefit or advantage of, any usury, stay or extension law wherever enacted,  now
or at any time  hereafter  in  force,  which may  affect  the  covenants  or the
performance  of this  Indenture;  and the  Company  (to the  extent  that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and  covenants  that it will not hinder,  delay or impede the  execution  of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.

                                  ARTICLE VIII

                             CONCERNING THE TRUSTEE

         Section 8.01  Duties And Responsibilities Of Trustee.
                       --------------------------------------

         (a) 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.  If 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 man would exercise or use under the circumstances in the conduct of
his own affairs.

                                       46


<PAGE>


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

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

                                    (A)  the  duties  and   obligations  of  the
                  Trustee shall be determined  solely by the express  provisions
                  of this Indenture,  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
                  against the Trustee; and

                                    (B) in the  absence  of bad  faith or actual
                  knowledge  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
                  provision hereof are specifically  required to be furnished to
                  the Trustee,  the Trustee shall be under a duty to examine the
                  same  to  determine   whether  or  not  they  conform  to  the
                  requirements of this Indenture;

                  (2) 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  it  shall  be  proved  that  the  Trustee  was   negligent   in
         ascertaining the pertinent facts; and

                  (3) the Trustee shall not be liable with respect to any action
         taken or omitted to be taken by it in good faith in accordance with the
         direction,  pursuant to this Indenture, of the Holders of a majority in
         principal amount of the Notes,  including,  but not limited to, Section
         7.07 hereof  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.

         Section 8.02  Reliance On Documents, Opinions, Etc. Except as otherwise
                       ------------------------------------
         provided in Section 8.01 hereof:



                                       47


<PAGE>


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

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

         (c) the Trustee may consult  with  counsel and any advice or Opinion of
Counsel shall be full and complete  authorization  and  protection in respect of
any action  taken,  suffered  or omitted  by it  hereunder  in good faith and in
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  Noteholders,  pursuant to this  Indenture,  unless such
Noteholders shall have offered to the Trustee  reasonable  security or indemnity
against  the costs,  expenses  and  liabilities  which may be  incurred  by such
exercise;

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

         (f) prior to the occurrence of an Event of Default  hereunder and after
the curing or waiving of all Events of Default,  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, consent,
order, approval, note or other paper or document, unless requested in writing to
do so by the  Holders of at least a  majority  in  principal  amount of the then
Outstanding Notes;  provided that if the payment within a reasonable time to the
Trustee of the costs, expenses or liabilities likely to be incurred by it in the
making of such  investigation is, in the opinion of the Trustee,  not reasonably
assured to the Trustee by the  security  afforded to it by this  Indenture,  the
Trustee may require reasonable  indemnity against such expense or liability as a
condition to so proceeding; and

                                       48


<PAGE>


         (g) the Trustee may  execute any of the trusts or powers  hereunder  or
perform any duties  hereunder  either  directly or through  agents or attorneys;
provided  that the  Trustee  shall not be liable for the  conduct or acts of any
such agent or attorney  that shall have been  appointed in  accordance  herewith
with due care.

         Section  8.03  No  Responsibility  For  Recitals,   Etc.  The  recitals
contained herein and in the Notes (except in the certificate of  authentication)
shall be taken as the  statements  of the  Company,  and the Trustee  assumes no
responsibility   for  the   correctness  of  the  same.  The  Trustee  makes  no
representations  as to the validity or  sufficiency  of this Indenture or of the
Notes.  The Trustee shall not be  accountable  for the use or application by the
Company of any Notes or the proceeds of any Notes authenticated and delivered by
the Trustee in conformity with this Indenture.

         Section 8.04 Trustee,  Authenticating  Agent, Paying Agent Or Registrar
May Own  Notes.  The  Trustee  and any  Authenticating  Agent,  paying  agent or
registrar,  in its individual or other capacity, may become the owner or pledgee
of  Notes  with  the  same  rights  it  would  have  if  it  were  not  Trustee,
Authenticating Agent or paying agent.

         Section  8.05  Moneys  To Be Held In Trust.  Subject  to  Section  4.04
hereof,  all moneys  received  by the  Trustee  shall,  until used or applied as
herein provided, be held in trust for the purposes for which they were received,
but need not be  segregated  from other funds  except to the extent  required by
law.  The  Trustee  may allow and credit to the  Company  interest  on any money
received  hereunder  at such rate,  if any, as may be agreed upon by the Company
and the Trustee from time to time as may be permitted by law.

         Section  8.06  Compensation  And  Expenses  Of  Trustee.   The  Company
covenants  and agrees to pay to the Trustee  from time to time,  and the Trustee
shall be entitled to, reasonable compensation (which shall not be limited by any
law in regard to the  compensation  of a trustee of an express  trust),  and the
Company shall pay or reimburse  the Trustee upon its request for all  reasonable
expenses,  disbursements  and  advances  incurred  or  made  by the  Trustee  in
accordance with this Indenture  (including the reasonable  compensation  and the
reasonable  expenses and disbursements of its counsel and agents,  including any
Authenticating  Agents,  and of all persons not regularly in its employ)  except
any such expense,  disbursement  or advance as may arise from its  negligence or
bad faith.  The Company also covenants to indemnify the Trustee for, and to hold
it harmless against, any loss, liability or expense incurred without

                                       49


<PAGE>


negligence  or bad faith on the part of the  Trustee  and  arising  out of or in
connection with the acceptance or  administration  of this trust,  including the
costs and  expenses of  defending  itself  against any claim or  liability.  The
obligations of the Company under this Section 8.06 to compensate the Trustee and
to pay or reimburse the Trustee for expenses,  disbursements  and advances shall
constitute additional indebtedness hereunder. Such additional indebtedness shall
be secured by a lien prior to that of the Notes 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 any particular Notes.

         Section  8.07  Officers'  Certificate  As  Evidence.  Whenever  in  the
administration  of this  Indenture,  the  Trustee  shall  deem it  necessary  or
desirable that a matter be proved or established prior to the taking,  suffering
or  omitting of any action  hereunder,  such matter  (unless  other  evidence in
respect  thereof  is herein  specifically  prescribed)  may,  in the  absence of
negligence or bad faith on the part of the Trustee, be deemed to be conclusively
proved and established by an Officers' Certificate delivered to the Trustee, and
such  Officers'  Certificate,  in the absence of  negligence or bad faith on the
part of the Trustee,  shall be full warrant to the Trustee for any action taken,
suffered or omitted by it under this Indenture in reliance thereon.

         Section  8.08  Conflicting  Interest Of Trustee.  The Trustee  shall be
subject to and shall comply with the  provisions  of Section  310(b) of the TIA.
Nothing in this Indenture shall be deemed to prohibit the Trustee or the Company
from making any application permitted pursuant to such section.

         Section 8.09 Existence And  Eligibility Of Trustee.  There shall at all
times be a Trustee  hereunder  which Trustee shall at all times be a corporation
organized  and doing  business  under the laws of the United States or any State
thereof or of the District of Columbia having a combined  capital and surplus of
at least  $50,000,000  and  which is  authorized  under  such  laws to  exercise
corporate  trust powers and is subject to  supervision or examination by Federal
or  State  authorities.  Such  corporation  shall  have its  principal  place of
business in the Borough of Manhattan,  The City of New York,  State of New York,
if there be such a corporation in such location  willing to act upon  reasonable
and customary terms and conditions.  If such  corporation  publishes  reports of
condition  at least  annually,  pursuant  to law or to the  requirements  of the
aforesaid  authority,  then for the purposes of this Section 8.09,  the combined
capital and surplus shall be deemed to be as set forth in its most recent report
of  condition  so  published.  No obligor  upon the Notes or Person  directly or
indirectly controlling, controlled by, or under common control with such obligor
shall

                                       50


<PAGE>


serve as  Trustee.  If at any time the  Trustee  shall  cease to be  eligible in
accordance  with this Section 8.09, the Trustee shall resign  immediately in the
manner and with the effect specified in Section 8.10 hereof.

         Section 8.10  Resignation Or Removal Of Trustee.
                       ---------------------------------

         (a) Pursuant to the provisions of this Article,  the Trustee may at any
time resign and be discharged of the trusts  created by this Indenture by giving
at least 30 days prior  written  notice to the Company  specifying  the day upon
which such resignation shall take effect, and such resignation shall take effect
immediately  upon the later of the  appointment of a successor  trustee and such
day.

         (b)  Any  Trustee  may be  removed  at any  time  by an  instrument  or
concurrent  instruments  in  writing  filed  with such  Trustee  and  signed and
acknowledged  by the  Holders  of a  majority  in  principal  amount of the then
Outstanding Notes or by their attorneys in fact duly authorized.

         (c) So long as no Event of Default has occurred and is continuing,  and
no event has occurred and is continuing  that,  with the giving of notice or the
lapse of time or both, would become an Event of Default,  the Company may remove
any Trustee upon written notice to the Holder of each Note  Outstanding  and the
Trustee and  appoint a successor  Trustee  meeting the  requirements  of Section
8.09. The Company or the successor Trustee shall give notice to the Holders,  in
the manner provided in Section 14.10, of such removal and appointment  within 30
days of such removal and appointment.

         (d) If at any time  (i) the  Trustee  shall  cease  to be  eligible  in
accordance  with  Section  8.09  hereof and shall fail to resign  after  written
request therefor by the Company or by any Holder who has been a bona fide Holder
for at least six months, (ii) the Trustee shall fail to comply with Section 8.08
hereof after  written  request  therefor by the Company or any such  Holder,  or
(iii) the  Trustee  shall  become  incapable  of acting or shall be  adjudged  a
bankrupt or  insolvent  or a receiver of the  Trustee or 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 the  Trustee may be removed  forthwith  by an  instrument  or
concurrent instruments in writing filed with the Trustee and either:

                                       51


<PAGE>


                  (1)    signed by the Chairman, President or any Vice President
         of the Company and attested by the Secretary or an Assistant Secretary
         of the Company; or

                  (2) signed and  acknowledged  by the  Holders of a majority in
         principal  amount of  Outstanding  Notes or by their  attorneys in fact
         duly authorized.

         (e)  Any  resignation  or  removal  of the  Trustee  shall  not  become
effective until  acceptance of appointment by the successor  Trustee as provided
in Section 8.12 hereof.

         Section 8.11  Appointment Of Successor Trustee.
                       --------------------------------

         (a) If at any time the Trustee shall resign or be removed, the Company,
by a Board Resolution, shall promptly appoint a successor Trustee.

         (b) The Company shall provide  written  notice of its  appointment of a
successor  Trustee to the  Holder of each Note  Outstanding  following  any such
appointment.

         (c) If no appointment of a successor  Trustee shall be made pursuant to
Section 8.11(a) hereof within 60 days after appointment  shall be required,  any
Noteholder  or the  resigning  Trustee  may  apply  to any  court  of  competent
jurisdiction to appoint a successor Trustee. Said court may thereupon after such
notice, if any, as such court may deem proper and prescribe, appoint a successor
Trustee.

         (d) Any  Trustee  appointed  under  this  Section  8.11 as a  successor
Trustee shall be a bank or trust company  eligible under Section 8.09 hereof and
qualified under Section 8.08 hereof.

         Section 8.12  Acceptance By Successor Trustee.
                       -------------------------------

         (a) Any successor  Trustee appointed as provided in Section 8.11 hereof
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 amounts
then due it pursuant to Section 8.06 hereof,  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

                                       52


<PAGE>


such  successor  Trustee,  the Company shall execute any and all  instruments in
writing  in order  more  fully  and  certainly  to vest in and  confirm  to such
successor Trustee all such rights and powers.  Any Trustee ceasing to act shall,
nevertheless, retain a lien upon all property or funds held or collected by such
Trustee to secure any amounts then due it pursuant to Section 8.06 hereof.

         (b) No successor  Trustee shall accept  appointment as provided in this
Section 8.12 unless at the time of such acceptance such successor  Trustee shall
be qualified under Section 8.08 hereof and eligible under Section 8.09 hereof.

         (c) Upon  acceptance of appointment by a successor  Trustee as provided
in this Section 8.12, the successor  Trustee shall mail notice of its succession
hereunder  to all Holders of Notes as the names and  addresses  of such  Holders
appear on the registry books.

         Section 8.13  Succession By Merger, Etc.
                       -------------------------

         (a) Any  corporation  into which the Trustee may be merged or converted
or with which it may be  consolidated,  or any  corporation  resulting  from any
merger,  conversion or  consolidation  to which the Trustee shall be a party, or
any corporation  succeeding to all or  substantially  all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder without
the  execution  or filing of any paper or any  further act on the part of any of
the parties hereto,  provided such corporation shall be otherwise  qualified and
eligible under this Article.

         (b) If at the time such  successor to the Trustee  shall succeed to the
trusts created by this Indenture any of the Notes shall have been  authenticated
but not delivered,  any such successor to the Trustee may adopt the  certificate
of  authentication  of any  predecessor  Trustee,  and  deliver  such  Notes  so
authenticated;  and in case at that  time any of the  Notes  shall not have been
authenticated,  any successor to the Trustee may authenticate  such Notes either
in the  name  of any  predecessor  hereunder  or in the  name  of the  successor
Trustee; and in all such cases such certificates shall have the full force which
it is anywhere in the Notes or in this Indenture  provided that the certificates
of the Trustee shall have;  provided that the right to adopt the  certificate of
authentication of any predecessor  Trustee or authenticate  Notes in the name of
any  predecessor  Trustee  shall apply only to its  successor or  successors  by
merger, conversion or consolidation.

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<PAGE>


         Section  8.14  Limitations  On Rights Of  Trustee  As A  Creditor.  The
Trustee  shall be subject to, and shall comply with,  the  provisions of Section
311 of the TIA.

         Section 8.15  Authenticating Agent.
                       --------------------

         (a) There may be one or more  Authenticating  Agents  appointed  by the
Trustee with the written consent of the Company, with power to act on its behalf
and subject to the direction of the Trustee in the  authentication  and delivery
of Notes in connection with transfers and exchanges  under Sections 2.06,  2.07,
2.08,  2.13,  3.03,  and 12.04  hereof,  as fully to all intents and purposes as
though  such  Authenticating  Agents  had  been  expressly  authorized  by those
Sections to authenticate  and deliver Notes. For all purposes of this Indenture,
the authentication and delivery of Notes by any Authenticating Agent pursuant to
this Section 8.15 shall be deemed to be the  authentication and delivery of such
Notes "by the Trustee." Any such  Authenticating  Agent shall be a bank or trust
company or other Person of the character and qualifications set forth in Section
8.09 hereof.

         (b) Any corporation into which any  Authenticating  Agent may be merged
or converted or with which it may be consolidated,  or any corporation resulting
from any merger,  conversion or consolidation to which any Authenticating  Agent
shall be a party, or any corporation  succeeding to the corporate trust business
of any Authenticating Agent, shall be the successor of such Authenticating Agent
hereunder,  if such  successor  corporation  is  otherwise  eligible  under this
Section 8.15, without the execution or filing of any paper or any further act on
the part of the parties  hereto or such  Authenticating  Agent or such successor
corporation.

         (c) 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 8.15, the
Trustee  may,  with the  written  consent of the  Company,  appoint a  successor
Authenticating  Agent,  and upon so doing  shall  give  written  notice  of such
appointment  to the Company and shall  mail,  in the manner  provided in Section
14.10, notice of such appointment to the Holders of Notes.

         (d) The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services, and the Trustee shall be entitled
to be reimbursed for such payments, in accordance with Section 8.06 hereof.

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<PAGE>


         (e) Sections 8.02, 8.03, 8.06, 8.07 and 8.09 hereof shall be applicable
to any Authenticating Agent.

                                   ARTICLE IX

                           CONCERNING THE NOTEHOLDERS

         Section 9.01 Action By  Noteholders.  Whenever in this  Indenture it is
provided  that the  Holders of a specified  percentage  in  aggregate  principal
amount of the Notes may take any 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 such  Noteholders  in  person  or by agent or  proxy  appointed  in
writing,  (b) by the record of such  Noteholders  voting in favor thereof at any
meeting of Noteholders duly called and held in accordance with Article X hereof,
or (c) by a combination of such instrument or instruments and any such record of
such a meeting of Noteholders.

         Section 9.02    Proof Of Execution By Noteholders.
                         ---------------------------------

         (a)  Subject to  Sections  8.01,  8.02 and 10.05  hereof,  proof of the
execution  of any  instruments  by a  Noteholder  or the agent or proxy for such
Noteholder  shall be sufficient if made in accordance with such reasonable rules
and  regulations  as may be prescribed by the Trustee or in such manner as shall
be  satisfactory  to the Trustee.  The ownership of Notes shall be proved by the
register for the Notes maintained by the Trustee.

         (b) The  record  of any  Noteholders'  meeting  shall be  proven in the
manner provided in Section 10.06 hereof.

         Section  9.03  Persons  Deemed  Absolute  Owners.  Subject to  Sections
2.04(f) and 9.01  hereof,  the Company,  the  Trustee,  any paying agent and any
Authenticating  Agent  shall  deem the  person in whose  name any Note  shall be
registered  upon the  register  for the Notes to be, and shall treat such person
as, the absolute  owner of such Note (whether or not such Note shall be overdue)
for the  purpose of  receiving  payment of or on  account of the  principal  and
premium,  if any, and  interest on such Note,  and for all other  purposes;  and
neither the Company nor the Trustee nor any paying agent nor any  Authenticating
Agent shall be affected by any notice to the contrary.  All such payments  shall
be valid and effectual to satisfy and discharge the liability upon any such Note
to the extent of the sum or sums so paid.

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<PAGE>


         Section 9.04 Company-Owned  Notes Disregarded.  In determining  whether
the Holders of the requisite  aggregate  principal  amount of Outstanding  Notes
have concurred in any direction,  consent or waiver under this Indenture,  Notes
which  are owned by the  Company  or any  other  obligor  on the Notes or by any
Person  directly or indirectly  controlling  or controlled by or under direct or
indirect common control with the Company or any other obligor on the Notes 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 or waiver,
only Notes which the Trustee knows are so owned shall be so  disregarded.  Notes
so owned which have been pledged in good faith to third  parties may be regarded
as  Outstanding  for the  purposes of this  Section  9.04 if the  pledgee  shall
establish the pledgee's right to take action with respect to such Notes and that
the pledgee is not a Person directly or indirectly  controlling or controlled by
or under  direct or indirect  common  control with the Company or any such other
obligor. In the case of a dispute as to such right, the Trustee may rely upon an
Opinion of Counsel and an Officers' Certificate to establish the foregoing.

         Section 9.05  Revocation Of Consents;  Future Holders Bound.  Except as
may be otherwise  required in the case of a Global Note by the applicable  rules
and regulations of the Depositary, at any time prior to the taking of any action
by the Holders of the  percentage  in  aggregate  principal  amount of the Notes
specified in this  Indenture  in  connection  with such action,  any Holder of a
Note,  which has been included in the Notes the Holders of which have  consented
to such action may, by filing  written  notice with the Trustee at the Corporate
Trust  Office of the Trustee and upon proof of  ownership as provided in Section
9.02(a)  hereof,  revoke such action so far as it concerns such Note.  Except as
aforesaid,  any such action taken by the Holder of any Note shall be  conclusive
and binding upon such Holder and upon all future Holders and owners of such Note
and of any Notes  issued  in  exchange,  substitution  or upon  registration  of
transfer  therefor,  irrespective of whether or not any notation thereof is made
upon such Note or such other Notes.

         Section  9.06 Record Date For  Noteholder  Acts.  If the Company  shall
solicit from the  Noteholders  any request,  demand,  authorization,  direction,
notice,  consent,  waiver or other act, the Company may, at its option, by Board
Resolution,  fix in advance a record date for the  determination  of Noteholders
entitled  to  give  such  request,  demand,  authorization,  direction,  notice,
consent, waiver or other act, but the Company shall have no obligation to do so.
If such a record date is fixed, such request, demand, authorization,  direction,
notice,  consent,  waiver or other act may be given  before or after the  record
date,

                                       56


<PAGE>


but only the  Noteholders  of record at the close of business on the record date
shall be deemed to be Noteholders for the purpose of determining whether Holders
of the requisite aggregate principal amount of Outstanding Notes have authorized
or  agreed or  consented  to such  request,  demand,  authorization,  direction,
notice, consent, waiver or other act, and for that purpose the Outstanding Notes
shall be computed as of the record date; provided that no such request,  demand,
authorization,   direction,   notice,  consent,  waiver  or  other  act  by  the
Noteholders on the record date shall be deemed  effective unless it shall become
effective  pursuant to this Indenture not later than six months after the record
date.  Any such  record  date shall be at least 30 days prior to the date of the
solicitation to the Noteholders by the Company.

                                    ARTICLE X

                              NOTEHOLDERS' MEETING

         Section 10.01  Purposes Of Meetings.  A meeting of  Noteholders  may be
called at any time and from time to time  pursuant to this  Article X for any of
the following purposes:

         (a) to give any notice to the Company or to the Trustee, or to give any
directions to the Trustee,  or to consent to the waiving of any Event of Default
hereunder  and its  consequences,  or to take any other action  authorized to be
taken by Noteholders pursuant to Article XII;

         (b)  to remove the Trustee pursuant to Article VIII;

         (c)  to consent to the execution of an indenture or indentures
supplemental hereto pursuant to Section 12.02 hereof; or

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

         Section 10.02 Call Of Meetings By Trustee.  The Trustee may at any time
call a meeting of Holders of Notes to take any action specified in Section 10.01
hereof,  to be  held  at  such  time  and at such  place  as the  Trustee  shall
determine.  Notice of every such meeting of Noteholders,  setting forth the time
and the place of such  meeting  and in general  terms the action  proposed to be
taken  at such  meeting,  shall be given to  Holders  of the  Notes  that may be
affected  by the  action  proposed  to be taken at such  meeting  in the  manner
provided in Section 14.10 hereof. Such notice shall be

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<PAGE>


given not less than 20 nor more  than 90 days  prior to the date  fixed for such
meeting.

         Section  10.03 Call Of  Meetings By Company Or  Noteholders.  If at any
time the Company, pursuant to a Board Resolution, or the Holders of at least 10%
in  aggregate  principal  amount  of the  Notes  then  Outstanding,  shall  have
requested  the  Trustee to call a meeting  of  Noteholders,  by written  request
setting  forth in  reasonable  detail  the  action  proposed  to be taken at the
meeting, and the Trustee shall not have mailed the notice of such meeting within
20 days after receipt of such request,  then the Company or such Noteholders may
determine  the time and the place for such  meeting and may call such meeting to
take any action  authorized in Section 10.01 hereof, by giving notice thereof as
provided in Section 10.02 hereof.

         Section 10.04  Qualifications For Voting. To be entitled to vote at any
meetings  of  Noteholders  a Person  shall (a) be a Holder of one or more  Notes
affected by the action  proposed to be taken or (b) be a Person  appointed by an
instrument  in writing as proxy by a Holder of one or more such Notes.  The only
Persons  who shall be  entitled  to be  present  or to speak at any  meeting  of
Noteholders  shall be the  Persons  entitled  to vote at such  meeting and their
counsel and any  representatives  (including  employees)  of the Trustee and its
counsel and any  representatives  (including  employees)  of the Company and its
counsel.

         Section 10.05 Regulations.
                       ------------

         (a) Notwithstanding any other provisions of this Indenture, the Trustee
may make such reasonable regulations as it may deem advisable for any meeting of
Noteholders in regard to proof of the holding of Notes 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.

         (b) 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 the Noteholders as provided in Section 10.03 hereof, in which case
the Company or  Noteholders  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 the  Holders  of a majority  in
aggregate  principal  amount of the Notes  present  in person or by proxy at the
meeting.

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<PAGE>


         (c) Subject to Section 9.04 hereof,  at any meeting each  Noteholder or
proxy shall be entitled  to one vote for each $1,000  principal  amount of Notes
held or represented by such  Noteholder;  provided that no vote shall be cast or
counted at any meeting in respect of any Note determined to be not  Outstanding.
The chairman of the meeting  shall have no right to vote other than by virtue of
Notes  held by such  chairman  or  instruments  in  writing  as  aforesaid  duly
designating such chairman as the Person to vote on behalf of other  Noteholders.
At any meeting of  Noteholders  duly called  pursuant to Section  10.02 or 10.03
hereof,  the presence of Persons holding or  representing  Notes in an aggregate
principal  amount  sufficient to take action on any business for the transaction
for which such  meeting was called  shall  constitute  a quorum.  Any meeting of
Noteholders  duly  called  pursuant  to  Section  10.02 or 10.03  hereof  may be
adjourned from time to time by the Holders of a majority in aggregate  principal
amount of the Notes present in person or by proxy 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 Noteholders  shall be by written ballots on which shall be subscribed
the signatures of the Holders of Notes or of their  representatives by proxy and
the  principal  amount  of Notes  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 such meeting of Noteholders shall be prepared by the secretary of
the meeting and there shall be attached to said record the  original  reports of
the  inspectors of votes on any vote by ballot taken  thereat and  affidavits by
one or more persons  having  knowledge of the facts  setting forth a copy of the
notice of the  meeting  and  showing  that said  notice was given as provided in
Section 10.02 hereof.  The record shall show the aggregate  principal  amount of
the Notes  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 and the Trustee  shall have
the ballots  taken at the  meeting  attached  to such  duplicate.  Any record so
signed and verified shall be conclusive evidence of the matters therein stated.

         Section 10.07 Rights Of Trustee Or Noteholders Not Delayed.  Nothing in
this Article X shall be deemed or construed to authorize or permit, by reason of
any call of a meeting  of  Noteholders  or any  rights  expressly  or  impliedly
conferred

                                       59


<PAGE>


hereunder to make such call, any hindrance or delay in the exercise of any right
or rights  conferred  upon or reserved to the Trustee or to the Holders of Notes
under any of the provisions of this Indenture or of the Notes.

                                   ARTICLE XI

                          CONSOLIDATION, MERGER, SALE,
                             TRANSFER OR CONVEYANCE

         Section 11.01 Company May Consolidate,  Etc. Only On Certain Terms. The
Company shall not consolidate with or merge into any other corporation or entity
or sell,  or  otherwise  dispose of its  properties  as or  substantially  as an
entirety  to any Person  unless the  Company  has  delivered  to the Trustee the
supplemental indenture referred to in (b) below and an Officers' Certificate and
an Opinion of Counsel each stating that such consolidation,  merger,  conveyance
or transfer and such supplemental indenture comply with this Article XI and that
all conditions  precedent  herein  provided for have been complied with, and the
corporation  formed by such consolidation or into which the Company is merged or
the Person which  receives such  properties  pursuant to such sale,  transfer or
other  disposition  (a) shall be a  corporation  or other entity  organized  and
existing  under the laws of the United  States of America,  any state thereof or
the  District of  Columbia;  and (b) shall  expressly  assume,  by an  indenture
supplemental  hereto,  executed and delivered to the Trustee, in form reasonably
satisfactory  to the Trustee,  the due and punctual  payment of the principal of
and premium,  if any, and  interest on all of the Notes and the  performance  of
every  covenant of this  Indenture on the part of the Company to be performed or
observed.

         Anything  in  this  Indenture  to  the  contrary  notwithstanding,  the
conveyance  or other  transfer  by the  Company of (a) all or any portion of its
facilities for the generation of electric  energy,  or (b) all of its facilities
for the transmission of electric energy, in each case considered alone or in any
combination with properties  described in any other clause, shall in no event be
deemed to constitute a conveyance or other transfer of all the properties of the
Company,  as or  substantially  as an  entirety.  The  character  of  particular
facilities shall be determined in accordance with the Uniform System of Accounts
prescribed for public utilities and licensees  subject to the Federal Power Act,
as amended, to the extent applicable.

         Section 11.02 Successor Corporation Substituted. Upon any consolidation
                       ---------------------------------
or merger,  or any sale,  transfer or other disposition of the properties of the
Company  substantially  as an entirety in accordance  with Section 11.01 hereof,
the successor



                                       60


<PAGE>


corporation  formed by such consolidation or into which the Company is merged or
to which such sale,  transfer or other disposition is made shall succeed to, and
be substituted  for and may exercise every right and power of, the Company under
this Indenture with the same effect as if such  successor  corporation  had been
named  as the  Company  herein  and the  Company  shall  be  released  from  all
obligations hereunder.

                                   ARTICLE XII

                             SUPPLEMENTAL INDENTURES

         Section 12.01 Supplemental Indentures Without Consent Of Noteholders.
                       ------------------------------------------------------

         (a) The Company,  when authorized by Board Resolution,  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:

                  (1) to make such  provision  in regard to matters or questions
         arising under this Indenture as may be necessary or desirable,  and not
         inconsistent with this Indenture or prejudicial to the interests of the
         Holders in any  material  respect,  for the  purpose of  supplying  any
         omission,  curing any ambiguity, or curing, correcting or supplementing
         any defective or inconsistent provision;

                  (2) to  change  or  eliminate  any of the  provisions  of this
         Indenture,  provided that any such change or  elimination  shall become
         effective only when there is no Note  Outstanding  created prior to the
         execution  of such  supplemental  indenture  which is  entitled  to the
         benefit of such  provision or such change or  elimination is applicable
         only to  Notes  issued  after  the  effective  date of such  change  or
         elimination;

                  (3) to  establish  the form of Notes as  permitted  by Section
         2.01 hereof or to establish or reflect any terms of any Note determined
         pursuant to Section 2.05 hereof;

                  (4) to evidence the  succession of another  corporation to the
         Company  as  permitted  hereunder,  and  the  assumption  by  any  such
         successor of the covenants of the Company herein and in the Notes;

                  (5)  to grant to or confer upon the Trustee for the benefit of
         the Holders any additional rights, remedies, powers or authority;




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<PAGE>


                  (6)  to permit the Trustee to comply with any duties imposed
         upon it by law;

                  (7) to specify further the duties and responsibilities of, and
         to  define   further  the   relationships   among  the   Trustee,   any
         Authenticating Agent and any paying agent;

                  (8) to add to the  covenants of the Company for the benefit of
         the Holders of one or more series of Notes,  to add to the security for
         the Notes,  to  surrender  a right or power  conferred  on the  Company
         herein  or to add any  Event of  Default  with  respect  to one or more
         series of Notes;

                  (9) to comply with the Company's obligations under Section
         5.06; and

                  (10)  to make any other change that is not prejudicial to the
         Holders in any material respect.

         (b) 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  which may be therein  contained and to accept the
conveyance,  transfer and assignment of any property thereunder, but the Trustee
shall not be  obligated  to enter  into any such  supplemental  indenture  which
affects the Trustee's own rights,  duties or immunities  under this Indenture or
otherwise.

         (c) Any supplemental  indenture authorized by this Section 12.01 may be
executed by the  Company  and the Trustee  without the consent of the Holders of
any of the Notes at the time Outstanding,  notwithstanding any of the provisions
of Section 12.02 hereof.

         Section 12.02 Supplemental Indentures With Consent Of Noteholders.
                       ----------------------------------------------------

         (a) With the consent  (evidenced as provided in Section 9.01 hereof) of
the Holders of a majority in aggregate principal amount of the Notes at the time
Outstanding,  the Company, when authorized by Board Resolution,  and the Trustee
may from time to time and at any time  enter  into an  indenture  or  indentures
supplemental  hereto for the purpose of adding any  provisions to or changing in
any manner or  eliminating  any of the  provisions  of this  Indenture or of any
supplemental  indenture  or of  modifying  in  any  manner  the  rights  of  the
Noteholders; provided that no such supplemental indenture shall:

                                       62


<PAGE>


                  (1) change the maturity  date of any Note,  or reduce the rate
         (or  change the method of  calculation  thereof)  or extend the time of
         payment of interest thereon,  or reduce the principal amount thereof or
         any  premium  thereon,  or  change  the coin or  currency  in which the
         principal of any Note or any premium or interest thereon is payable, or
         change the date on which any Note may be redeemed or  adversely  affect
         the rights of the  Noteholders to institute suit for the enforcement of
         any payment of principal of or any premium or interest on any Note; or

                  (2) modify  this  Section  12.02(a)  or reduce  the  aforesaid
         percentage  of Notes,  the Holders of which are  required to consent to
         any such  supplemental  indenture or to reduce the percentage of Notes,
         the Holders of which are required to waive  Events of Default,  in each
         case,  without  the  consent  of the  Holders  of all of the Notes then
         Outstanding.

         (b) Upon the request of the Company, accompanied by a copy of the Board
Resolution  authorizing the execution of any such  supplemental  indenture,  and
upon the filing with the Trustee of  evidence of the consent of  Noteholders  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.

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

         (d) It shall not be  necessary  for the consent of the Holders of Notes
under  this  Section  12.02  to  approve  the  particular  form of any  proposed
supplemental indenture, but it shall be sufficient if such consent shall approve
the substance thereof.

         (e) Promptly  after the execution by the Company and the Trustee of any
supplemental  indenture  pursuant to this Section 12.02,  the Trustee shall give
notice in the manner provided in Section 14.10 hereof,  setting forth in general
terms the substance of such  supplemental  indenture,  to all  Noteholders.  Any
failure of the Trustee to give such notice or any defect therein

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<PAGE>


shall  not,  however,  in any way  impair or  affect  the  validity  of any such
supplemental indenture.

         Section  12.03   Compliance   With  Trust   Indenture  Act;  Effect  Of
Supplemental  Indentures.  Any supplemental  indenture executed pursuant to this
Article XII shall comply with the TIA.  Upon the  execution of any  supplemental
indenture  pursuant to this Article XII, the Indenture shall be and be deemed to
be modified  and amended in  accordance  therewith  and the  respective  rights,
limitations of rights,  obligations,  duties and immunities under this Indenture
of the Trustee,  the Company and the Noteholders shall thereafter be determined,
exercised and enforced  hereunder subject in all respects to such  modifications
and  amendments,  and all the  terms  and  conditions  of any such  supplemental
indenture  shall be and be deemed to be part of the terms and conditions of this
Indenture for any and all purposes.

         Section  12.04  Notation On Notes.  Notes  authenticated  and delivered
after the execution of any supplemental  indenture  pursuant to this Article XII
may bear a notation in form  approved  by the Trustee as to any matter  provided
for in such supplemental indenture. If the Company shall so determine, new Notes
so modified as approved by the Trustee and the Board of  Directors  with respect
to any  modification  of  this  Indenture  contained  in any  such  supplemental
indenture  may be prepared  and executed by the  Company,  authenticated  by the
Trustee and delivered in exchange for the Notes then Outstanding.

         Section 12.05  Evidence Of Compliance Of  Supplemental  Indenture To Be
Furnished  Trustee.  The Trustee,  subject to Sections 8.01 and 8.02 hereof, may
receive 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 XII.

                                  ARTICLE XIII

                           IMMUNITY OF INCORPORATORS,
                      STOCKHOLDERS, OFFICERS AND DIRECTORS

         Section 13.01  Indenture  And Notes Solely  Corporate  Obligations.  No
recourse  for the payment of the  principal of or any premium or interest on any
Note,  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,
contained in this Indenture or in any supplemental indenture, or in any Note, or
because of the creation of any indebtedness  represented  thereby,  shall be had
against any  incorporator,  stockholder,  officer or  director,  as such,  past,
present or

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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 issuance of the Notes.



                                   ARTICLE XIV

                            MISCELLANEOUS PROVISIONS

         Section  14.01  Provisions  Binding On  Company's  Successors.  All the
covenants,  stipulations,  promises and  agreements  made by the Company in this
Indenture shall bind its successors and assigns whether so expressed or not.

         Section  14.02  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 corporation that shall at the time be the lawful successor of the
Company.

         Section 14.03  Notices.  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  Noteholders  on the  Company  may be given or served by being  deposited
postage prepaid in a post office letter box addressed  (until another address is
filed by the Company with the Trustee) at the principal executive offices of the
Company, to the attention of the Secretary.  Any notice,  direction,  request or
demand by any  Noteholder  or the Company to or upon the Trustee shall be deemed
to have been sufficiently  given or made, for all purposes,  if given or made in
writing at the Corporate Trust Office of the Trustee, Attention: Corporate Trust
Department.

         SECTION  14.04  GOVERNING  LAW.  THIS  INDENTURE AND EACH NOTE SHALL BE
GOVERNED BY AND DEEMED TO BE A CONTRACT UNDER, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK,  AND FOR ALL  PURPOSES  SHALL BE CONSTRUED IN
ACCORDANCE  WITH THE LAWS OF SAID STATE,  EXCEPT AS MAY OTHERWISE BE REQUIRED BY
MANDATORY PROVISIONS OF LAW.

         Section 14.05 Evidence Of Compliance With Conditions Precedent.
                       ------------------------------------------------




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         (a) Upon any  application  or demand by the  Company to the  Trustee to
take any action under this  Indenture,  the Company shall furnish to the Trustee
an Officers' Certificate stating that all conditions precedent, if any, provided
for in this Indenture (including any covenants compliance with which constitutes
a condition  precedent)  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.

         (b) 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 (other than the certificates  delivered  pursuant
to Section 5.05 hereof)  shall  include (1) a statement  that each Person making
such  certificate  or  opinion  has read  such  covenant  or  condition  and the
definitions  relating thereto;  (2) a brief statement as to the nature and scope
of the  examination  or  investigation  upon which the  statements  or  opinions
contained in such certificate or opinion are based; (3) a statement that, in the
opinion  of  each  such  Person,  such  Person  has  made  such  examination  or
investigation  as is  necessary  to enable  such  Person 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.

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

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

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or opinion of  representations  with respect to such matters are erroneous.  Any
opinion of counsel  delivered  hereunder  may contain  standard  exceptions  and
qualifications reasonably satisfactory to the Trustee.

         (e)  Any  certificate,  statement  or  opinion  of any  officer  of the
Company,  or of  counsel,  may be based,  insofar as it  relates  to  accounting
matters,  upon a certificate or opinion of or  representations by an independent
public accountant or firm of accountants, unless such officer or counsel, as the
case may be,  knows that the  certificate  or opinion  or  representations  with
respect to the  accounting  matters  upon which the  certificate,  statement  or
opinion of such officer or counsel may be based as aforesaid are  erroneous,  or
in the exercise of reasonable care should know that the same are erroneous.  Any
certificate or opinion of any firm of independent  public accountants filed with
the Trustee shall contain a statement that such firm is independent.

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

         Section 14.06  Business Days.  Unless  otherwise  provided  pursuant to
Section 2.05(c) hereof,  in any case where the date of maturity of the principal
of or any premium or interest  on any Note or the date fixed for  redemption  of
any Note is not a Business Day, then payment of such principal or any premium or
interest  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 date fixed for redemption, and, in the case of timely payment thereof, no
interest  shall accrue for the period from and after such Interest  Payment Date
or the date on which the  principal or premium,  if any, of the Note is required
to be paid.

         Section 14.07 Trust Indenture Act To Control. If and to the extent that
any provision of this Indenture  limits,  qualifies or conflicts with the duties
imposed by the TIA, such required provision of the TIA shall govern.

         Section 14.08 Table Of Contents,  Headings,  Etc. The table of contents
and the titles and headings of the articles and sections of this  Indenture have
been inserted for convenience of reference only, are not to be considered a part
hereof,  and shall in no way modify or restrict  any of the terms or  provisions
hereof.

         Section 14.09 Execution In Counterparts. This Indenture may be executed
                       -------------------------
 in any number of counterparts, each of which shall be



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an original,  but such  counterparts  shall together  constitute but one and the
same instrument.

         Section 14.10 Manner Of Mailing Notice To Noteholders.
                       ----------------------------------------

         (a) Any notice or demand which by any  provision  of this  Indenture is
required or  permitted to be given or served by the Trustee or the Company to or
on the  Holders  of  Notes,  as the case may be,  shall  be given or  served  by
first-class  mail,  postage  prepaid,  addressed to the Holders of such Notes at
their last  addresses as the same appear on the register for the Notes  referred
to in Section 2.06, and any such notice shall be deemed to be given or served by
being  deposited in a post office letter box in the form and manner  provided in
this Section 14.10.  In case by reason of the suspension of regular mail service
or by reason of any other cause it shall be  impracticable to give notice to any
Holder by mail, then such  notification to such Holder as shall be made with the
approval of the Trustee  shall  constitute a sufficient  notification  for every
purpose hereunder.

         (b) The Company  shall also  provide any  notices  required  under this
Indenture  by  publication,  but only to the  extent  that such  publication  is
required  by the  TIA,  the  rules  and  regulations  of the  Commission  or any
securities exchange upon which any series of Notes is listed.

         Section  14.11  Approval By Trustee Of Expert Or Counsel.  Wherever the
Trustee is required  to approve an Expert or counsel who is to furnish  evidence
of compliance with conditions precedent in this Indenture,  such approval by the
Trustee  shall be deemed to have been given upon the taking of any action by the
Trustee  pursuant  to and in  accordance  with the  certificate  or  opinion  so
furnished by such Expert or counsel.

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                  IN WITNESS WHEREOF,  the  undersigned,  being duly authorized,
have executed this  Indenture on behalf of the  respective  parties hereto as of
the date first above written.

                                            PENNSYLVANIA ELECTRIC COMPANY


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



                                            UNITED STATES TRUST COMPANY
                                            OF NEW YORK
                                                AS TRUSTEE


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
















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