Exhibit 4b
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                                  INDENTURE OF TRUST
                                   (1997 SERIES A)


                                       BETWEEN



                         THE INDUSTRIAL DEVELOPMENT AUTHORITY
                                OF THE COUNTY OF PIMA



                                         AND



                    FIRST TRUST OF NEW YORK, NATIONAL ASSOCIATION




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




                            DATED AS OF SEPTEMBER 15, 1997




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



                                     AUTHORIZING

                        INDUSTRIAL DEVELOPMENT REVENUE BONDS,
                                    1997 SERIES A
                       (TUCSON ELECTRIC POWER COMPANY PROJECT)


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     <PAGE>

                                TABLE OF CONTENTS*


                                                                       Page
                                                                       ----

             Parties  . . . . . . . . . . . . . . . . . . . . . . . . .   1
             Recitals . . . . . . . . . . . . . . . . . . . . . . . . .   1
             Granting Clause  . . . . . . . . . . . . . . . . . . . . .   2


                                      ARTICLE I

                                     DEFINITIONS

          Section 1.01.  Definitions. . . . . . . . . . . . . . . . . .   2

                                      ARTICLE II

                                      THE BONDS

          Section 2.01.  Creation of Bonds. . . . . . . . . . . . . . .   9
          Section 2.02.  Form of Bonds. . . . . . . . . . . . . . . . .   9
          Section 2.03.  Execution of Bonds.  . . . . . . . . . . . . .  10
          Section 2.04.  Authentication of Bonds. . . . . . . . . . . .  10
          Section 2.05.  Bonds Not General Obligations. . . . . . . . .  10
          Section 2.06.  Prerequisites to Authentication of Bonds.  . .  10
          Section 2.07.  Lost or Destroyed Bonds or Bonds Canceled
                           in Error . . . . . . . . . . . . . . . . . .  11
          Section 2.08.  Transfer, Registration and Exchange of Bonds .  11
          Section 2.09.  Other Obligations  . . . . . . . . . . . . . .  13
          Section 2.10   Temporary Bonds. . . . . . . . . . . . . . . .  13
          Section 2.11.  Cancellation of Bonds  . . . . . . . . . . . .  13
          Section 2.12.  Payment of Principal and Interest  . . . . . .  13
          Section 2.13.  Applicability of Book-Entry Provisions . . . .  14

                                     ARTICLE III

                                 REDEMPTION OF BONDS

          Section 3.01.  Redemption Provisions  . . . . . . . . . . . .  14
          Section 3.02.  Selection of Bonds to be Redeemed  . . . . . .  15
          Section 3.03.  Procedure for Redemption . . . . . . . . . . .  16
          Section 3.04.  Payment of Redemption Price  . . . . . . . . .  16
          Section 3.05.  No Partial Redemption After Default  . . . . .  17

                                      ARTICLE IV

                                    THE BOND FUND


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

      *  This table of contents is not a part of the Indenture, and is for 
         convenience only.  The captions herein are of no legal effect and 
         do not vary the meaning or legal effect of any part of the 
         Indenture.

     <PAGE>

          Section 4.01.  Creation of Bond Fund  . . . . . . . . . . . .  17
          Section 4.02.  Liens  . . . . . . . . . . . . . . . . . . . .  17
          Section 4.03.  Deposits into Bond Fund  . . . . . . . . . . .  17
          Section 4.04.  Use of Moneys in Bond Fund . . . . . . . . . .  18
          Section 4.05.  Custody of Bond Fund; Withdrawal of Moneys . .  18
          Section 4.06.  Bonds Not Presented for Payment  . . . . . . .  18
          Section 4.07.  Moneys Held in Trust . . . . . . . . . . . . .  19

                                      ARTICLE V

                                THE CONSTRUCTION FUND

          Section 5.01.  Creation of, and Disbursements from,
                           Construction Fund  . . . . . . . . . . . . .  19
          Section 5.02.  Completion of Facilities; Termination
                           of Construction. . . . . . . . . . . . . . .  20
          Section 5.03.  Redemption of All Outstanding Bonds  . . . . .  21
          Section 5.04.  Acceleration of Bonds  . . . . . . . . . . . .  21
          Section 5.05.  Refunding of Bonds . . . . . . . . . . . . . .  21
          Section 5.06.  Moneys Held in Trust . . . . . . . . . . . . .  22

                                      ARTICLE VI

                                     INVESTMENTS

          Section 6.01.  Investments  . . . . . . . . . . . . . . . . .  22

                                     ARTICLE VII

                                  GENERAL COVENANTS

          Section 7.01.  No General Obligations . . . . . . . . . . . .  23
          Section 7.02.  Performance of Covenants of the Authority;
                           Representations  . . . . . . . . . . . . . .  23
          Section 7.03.  Maintenance of Rights and Powers; Compliance
                           with Laws  . . . . . . . . . . . . . . . . .  23
          Section 7.04.  Enforcement of Obligations of the Company;
                           Amendments . . . . . . . . . . . . . . . . .  23
          Section 7.05.  Further Instruments. . . . . . . . . . . . . .  23
          Section 7.06.  No Disposition of Trust Estate.  . . . . . . .  24
          Section 7.07.  Financing Statements.    . . . . . . . . . . .  24
          Section 7.08.  Tax Covenants; Rebate Fund.  . . . . . . . . .  24
          Section 7.09.  Notices of Trustee.  . . . . . . . . . . . . .  25

                                     ARTICLE VIII

                                      DEFEASANCE

          Section 8.01.  Defeasance.  . . . . . . . . . . . . . . . . .  25

                                      ARTICLE IX

                                DEFAULTS AND REMEDIES

          Section 9.01.  Events of Default. . . . . . . . . . . . . . .  26
          Section 9.02.  Remedies.  . . . . . . . . . . . . . . . . . .  27
          Section 9.03.  Restoration to Former Position.  . . . . . . .  27
          Section 9.04.  Owners' Right to Direct Proceedings. . . . . .  28
          Section 9.05.  Limitation on Owners' Right to
                           Institute Proceedings. . . . . . . . . . . .  28
          Section 9.06.  No Impairment of Right to Enforce Payment. . .  28
          Section 9.07.  Proceedings by Trustee without Possession
                           of Bonds.  . . . . . . . . . . . . . . . . .  28
          Section 9.08.  No Remedy Exclusive. . . . . . . . . . . . . .  28
          Section 9.09.  No Waiver of Remedies. . . . . . . . . . . . .  29
          Section 9.10.  Application of Moneys. . . . . . . . . . . . .  29
          Section 9.11.  Severability of Remedies.  . . . . . . . . . .  29

                                      ARTICLE X

                TRUSTEE; PAYING AGENT AND CO-PAYING AGENTS; REGISTRAR

          Section 10.01. Acceptance of Trusts.  . . . . . . . . . . . .  30
          Section 10.02. No Responsibility for Recitals.  . . . . . . .  30
          Section 10.03. Limitations on Liability.  . . . . . . . . . .  30
          Section 10.04. Compensation, Expenses and Advances. . . . . .  30
          Section 10.05. Notice of Events of Default. . . . . . . . . .  31
          Section 10.06. Action by Trustee. . . . . . . . . . . . . . .  31
          Section 10.07. Good Faith Reliance. . . . . . . . . . . . . .  31
          Section 10.08. Dealings in Bonds and with the Authority
                           and the Company. . . . . . . . . . . . . . .  31
          Section 10.09. Allowance of Interest. . . . . . . . . . . . .  32
          Section 10.10. Construction of Indenture. . . . . . . . . . .  32
          Section 10.11. Resignation of Trustee.  . . . . . . . . . . .  32
          Section 10.12. Removal of Trustee.  . . . . . . . . . . . . .  32
          Section 10.13. Appointment of Successor Trustee.  . . . . . .  32
          Section 10.14. Qualifications of Successor Trustee. . . . . .  33
          Section 10.15. Judicial Appointment of Successor Trustee. . .  33
          Section 10.16. Acceptance of Trusts by Successor Trustee. . .  33
          Section 10.17. Successor by Merger or Consolidation.  . . . .  33
          Section 10.18. Standard of Care.  . . . . . . . . . . . . . .  34
          Section 10.19. Notice to Owners of Bonds of Event of Default.  34
          Section 10.20. Intervention in Litigation of the Authority. .  34
          Section 10.21. Paying Agent; Co-Paying Agents.  . . . . . . .  34
          Section 10.22. Qualifications of Paying Agent and
                           Co-Paying Agents; Resignation; Removal.  . .  35
          Section 10.23. Registrar. . . . . . . . . . . . . . . . . . .  35
          Section 10.24. Qualifications of Registrar; Resignation;
                           Removal. . . . . . . . . . . . . . . . . . .  36
          Section 10.25. Several Capacities.  . . . . . . . . . . . . .  36

                                      ARTICLE XI

                   EXECUTION OF INSTRUMENTS BY OWNERS OF BONDS AND
                             PROOF OF OWNERSHIP OF BONDS

          Section 11.01. Execution of Instruments; Proof of Ownership.   36
  
                                      ARTICLE XII

                MODIFICATION OF THIS INDENTURE AND THE LOAN AGREEMENT

          Section 12.01. Limitations. . . . . . . . . . . . . . . . . .  37
          Section 12.02. Supplemental Indentures without Owner Consent.  37
          Section 12.03. Supplemental Indentures with Consent of 
                           Owners . . . . . . . . . . . . . . . . . . .  38
          Section 12.04. Effect of Supplemental Indenture.  . . . . . .  39
          Section 12.05. Consent of the Company.  . . . . . . . . . . .  39
          Section 12.06. Amendment of Loan Agreement without Consent
                           of Owners. . . . . . . . . . . . . . . . . .  39
          Section 12.07. Amendment of Loan Agreement with Consent
                           of Owners. . . . . . . . . . . . . . . . . .  39

                                     ARTICLE XIII

                                    MISCELLANEOUS

          Section 13.01. Successors of the Authority. . . . . . . . . .  40
          Section 13.02. Parties in Interest. . . . . . . . . . . . . .  40
          Section 13.03. Severability.  . . . . . . . . . . . . . . . .  40
          Section 13.04. No Personal Liability of Authority Officials.   40
          Section 13.05. Bonds Owned by the Authority or the Company. .  40
          Section 13.06. Counterparts.  . . . . . . . . . . . . . . . .  41
          Section 13.07. Governing Law. . . . . . . . . . . . . . . . .  41
          Section 13.08. Notices. . . . . . . . . . . . . . . . . . . .  41
          Section 13.09. Holidays.  . . . . . . . . . . . . . . . . . .  41
          Section 13.10. Statutory Notice Regarding Cancellation
                           of Contracts.    . . . . . . . . . . . . . .  41


          Testimonium . . . . . . . . . . . . . . . . . . . . . . . .    43
          Signatures and Seals  . . . . . . . . . . . . . . . . . . .    43

          Exhibit A - Form of Bond  . . . . . . . . . . . . . . . . . . A-1
          Exhibit B - Form of Endorsement of Transfer . . . . . . . . . B-1
          Exhibit C - Form of Certificate of Authentication . . . . . . C-1


     <PAGE>


                                  INDENTURE OF TRUST

             THIS INDENTURE OF TRUST (1997 A Series), dated as of September
          15, 1997 (this "Indenture"), between THE INDUSTRIAL DEVELOPMENT
          AUTHORITY OF THE COUNTY OF PIMA, an Arizona nonprofit corporation
          designated by law as a political subdivision of the State of
          Arizona (hereinafter called the "Authority"), and First Trust of
          New York, National Association, as trustee (hereinafter called
          the "Trustee"),

                                W I T N E S S E T H :


             WHEREAS, the Authority is authorized and empowered under Title
          35, Chapter 5, Arizona Revised Statutes, as amended (the "Act"),
          to issue its bonds in accordance with the Act and to make secured
          or unsecured loans for the purpose of financing or refinancing
          the acquisition, construction, improvement or equipping of
          projects consisting of land, any building or other improvement,
          and all real and personal properties, including but not limited
          to machinery and equipment, whether or not now in existence or
          under construction, whether located within or without Pima
          County, which shall be suitable for, among other things,
          facilities for the furnishing of electric energy, gas or water,
          air and water pollution control facilities and sewage and solid
          waste disposal facilities, and to charge and collect interest on
          such loans and pledge the proceeds of loan agreements as security
          for the payment of the principal of and interest on bonds, or
          designated issues of bonds, issued by the Authority and any
          agreements made in connection therewith, whenever the Board of
          Directors of the Authority finds such loans to be in furtherance
          of the purposes of the Authority or in the public interest;

             WHEREAS, the Authority has heretofore issued and sold
          $20,000,000 aggregate principal amount of its Industrial
          Development Revenue Bonds, 1990 Series A (Tucson Electric Power
          Company Project), all of which remain outstanding (the "1990
          Bonds"), the proceeds of which were loaned to Tucson Electric
          Power Company, an Arizona corporation (the "Company"), for the
          purpose of financing a portion of the costs of the acquisition,
          construction, improvement and equipping of certain of its
          facilities for the furnishing of electric energy (the
          "Facilities"); and

             WHEREAS, the Authority proposes to issue and sell its revenue
          bonds as provided herein (the "Bonds") for the purpose of
          financing a portion of the costs of the acquisition,
          construction, improvement and equipping certain additional items
          of the Facilities and for the purpose of refinancing, by the
          payment or redemption of the 1990 Bonds, or provision therefor,
          the portion of the costs of the acquisition, construction,
          improvement and equipping of the Facilities previously financed
          with the proceeds of the 1990 Bonds, all as described in Exhibit
          A to the Loan Agreement, dated as of September 15, 1997 (the
          "Loan Agreement"), between the Authority and the Company;

             NOW, THEREFORE, for and in consideration of these premises and
          the mutual covenants herein contained, of the acceptance by the
          Trustee of the trusts hereby created, of the purchase and
          acceptance of the Bonds by the Owners (as hereinafter defined)
          thereof and of the sum of one dollar lawful money of the United
          States of America, to it duly paid by the Trustee at or before
          the execution and delivery of these presents, and for other good
          and valuable consideration the receipt and sufficiency of which
          are hereby acknowledged, in order to secure the payment of the
          principal of and premium, if any, and interest on the Bonds at
          any time Outstanding (as hereinafter defined) under this
          Indenture according to their tenor and effect and the performance
          and observance by the Authority of all the covenants and
          conditions expressed or implied herein and contained in the
          Bonds, the Authority does hereby grant, bargain, sell, convey,
          mortgage, pledge and assign, and grant a security interest in,
          the Trust Estate (as hereinafter defined) to the Trustee, its
          successors in trust and their assigns forever;

             TO HAVE AND TO HOLD all the same with all privileges and
          appurtenances hereby conveyed and assigned, or agreed or intended
          so to be, to the Trustee, its successors in trust and their
          assigns forever;

             IN TRUST NEVERTHELESS, upon the terms and trusts herein set
          forth, first, for the equal and proportionate benefit and
          security of all Owners of the Bonds issued under and secured by
          this Indenture without preference, priority or distinction as to
          the lien of any Bonds over any other Bonds;

             PROVIDED, HOWEVER, that if, after the right, title and
          interest of the Trustee in and to the Trust Estate shall have
          ceased, terminated and become void in accordance with Article
          VIII hereof, the principal of and premium, if any, and interest
          on the Bonds shall have been paid to the Owners thereof, or shall
          have been paid to the Company pursuant to Section 4.06 hereof,
          then and in that case these presents and the estate and rights
          hereby granted shall cease, terminate and be void, and thereupon
          the Trustee shall cancel and discharge this Indenture and execute
          and deliver to the Authority and the Company such instruments in
          writing as shall be requisite to evidence the discharge hereof;
          otherwise this Indenture is to be and remain in full force and
          effect.

             THIS INDENTURE OF TRUST FURTHER WITNESSETH, and it is
          expressly declared, that all Bonds issued and secured hereunder
          are to be issued, authenticated and delivered, and the Trust
          Estate and the other estate and rights hereby granted are to be
          dealt with and disposed of, under, upon and subject to the terms,
          conditions, stipulations, covenants, agreements, trusts, uses and
          purposes as hereinafter expressed, and the Authority has agreed
          and covenanted, and does hereby agree and covenant, with the
          Trustee and with the respective Owners, from time to time, of the
          Bonds, as follows:


                                      ARTICLE I

                                     DEFINITIONS

             Section 1.01.  Definitions.  The terms defined in this Article
          I shall, for all purposes of this Indenture, have the meanings
          herein specified, unless the context clearly requires otherwise:

          Act:

             "Act" shall mean Title 35, Chapter 5, Arizona Revised
          Statutes, and all acts supplemental thereto or amendatory
          thereof.

          Administration Expenses:

             "Administration Expenses" shall mean the reasonable expenses
          incurred by the Authority with respect to the Loan Agreement,
          this Indenture and any transaction or event contemplated by the
          Loan Agreement or this Indenture, including the compensation and
          reimbursement of expenses and advances payable to the Trustee, to
          the Paying Agent, any Co-Paying Agent and the Registrar and a pro
          rata share of the Authority's annual operating expenses in
          accordance with the provisions of paragraph XII.D. of the
          Authority's Procedural Pamphlet.

          Authority

             "Authority" shall mean The Industrial Development Authority of
          the County of Pima, an Arizona nonprofit corporation designated
          by law as a political subdivision of the State of Arizona
          incorporated for and with the approval of Pima County, Arizona,
          pursuant to the provisions of the Constitution of the State of
          Arizona and the Act, its successors and their assigns.

          Authorized Company Representative:

             "Authorized Company Representative" shall mean each person at
          the time designated to act on behalf of the Company by written
          certificate furnished to the Authority and the Trustee containing
          the specimen signature of such person and signed on behalf of the
          Company by its President, any Vice President or its Treasurer,
          together with its Secretary or any Assistant Secretary.

          Bond Counsel:

             "Bond Counsel" shall mean any firm or firms of nationally
          recognized bond counsel experienced in matters pertaining to the
          validity of, and exclusion from gross income for federal tax
          purposes of interest on bonds issued by states and political
          subdivisions, selected by the Company and acceptable to the
          Authority.

          Bond Fund:

             "Bond Fund" shall mean the fund created by Section 4.01
          hereof.

          Bonds:

             "Bond" or "Bonds" shall mean the bonds authorized to be issued
          under this Indenture.

          Capital Account:

             "Capital Account" shall mean any of the accounts so named
          established under Sections 4.01 and 5.01 hereof.

          Code:

             "Code" shall mean the Internal Revenue Code of 1986 or any
          successor statute thereto.  Each reference to a section of the
          Code herein shall be deemed to include the United States Treasury
          Regulations proposed or in effect thereunder and applicable to
          the Bonds or the use of proceeds thereof, unless the context
          clearly requires otherwise.  References to any particular Code
          section shall, in the event of a successor Code, be deemed to be
          a reference to the successor to such Code section.

          Company:

             "Company" shall mean Tucson Electric Power Company, a
          corporation organized and existing under the laws of the State of
          Arizona, its successors and their assigns, including without
          limitation, any successor obligor under Section 6.01 or 7.01 of
          the Loan Agreement to the extent of the obligations assumed
          thereunder.

          Completion Date:

             "Completion Date" shall mean the date specified in Section
          3.04 of the Loan Agreement.

          Construction (and other forms of the word "construct"):

             "Construction" (and other forms of the word "construct") shall
          mean, when used with respect to the Facilities, the construction
          of the Facilities and shall include, without limitation, the
          acquisition, construction, improvement and equipping of the
          Facilities, all as contemplated by the Act.

          Construction Fund:

             "Construction Fund" shall mean the fund created by Section
          5.01 hereof.

          Cost of Construction:

             "Cost of Construction" shall embrace all costs paid or
          incurred by the Company with respect to the Facilities and the
          financing thereof for the payment of which the Authority is
          authorized to issue bonds under the Act, and shall include
          without limitation (a) obligations paid or incurred by the
          Company for labor, materials and other expenses and to
          contractors, builders and materialmen in connection with the
          construction of the Facilities; (b) the costs paid or incurred by
          the Company for contract bonds and for insurance of all kinds
          that may be deemed by the Company to be desirable or necessary
          during the course of construction of the Facilities; (c) the
          expenses paid or incurred by the Company for test borings,
          surveys, estimates, plans and specifications, and preliminary
          investigations therefor, with respect to the Facilities and for
          supervising construction, as well as for the performance of all
          other duties required by or reasonably necessary for the proper
          construction, of the Facilities; (d) Administration Expenses paid
          or incurred prior to the Completion Date and legal, accounting,
          financial, underwriting, advertising, recording and printing
          expenses and all other fees and expenses paid or incurred by the
          Company in connection with the issuance and sale of the Bonds;
          (e) amounts in respect of interest (exclusive of accrued interest
          paid by the initial purchasers upon delivery thereof) accruing
          upon the Bonds until the Completion Date; (f) all other costs
          that the Company shall be required to pay under the terms of any
          contract or contracts for the construction of the Facilities; (g)
          any other costs or expenses paid or incurred by the Company, and
          any sums required to reimburse the Company for work done by it,
          with respect to the Facilities which are properly chargeable to
          the capital account of the Company with respect to the Facilities
          or would be so chargeable for federal income tax purposes either
          with a proper election or but for a proper election to deduct the
          same; and (h) amounts required to be paid to the United States by
          the Company (on behalf of the Authority) in respect of the Bonds
          pursuant to Section 148 of the Code.  For purposes of the
          application of the proceeds of the Bonds, the Cost of
          Construction shall be deemed to include the payment or
          redemption, or provision therefor, of any obligations, other than
          the Bonds, issued to finance or refinance any of the costs listed
          above.  The Cost of Construction shall also be deemed to include
          all costs paid or incurred with respect to the Facilities by any
          Person (as defined in the Loan Agreement) to whom the Facilities
          have been leased or sold as a whole or in part, provided that
          such costs, had they been paid or incurred by the Company, would
          otherwise constitute a portion of the Cost of Construction.

          Depositary:

             "Depositary" shall mean The Depository Trust Company or any
          successor thereto as a securities repository for the Bonds.

          Facilities:

             "Facilities" shall mean the real and personal properties,
          machinery and equipment currently existing, under construction
          and to be constructed which are described in Exhibit A to the
          Loan Agreement, as revised from time to time to reflect any
          changes therein, additions thereto, substitutions therefor and
          deletions therefrom permitted by the terms of the Loan Agreement,
          subject, however, to the provisions of Section 7.01 of the Loan
          Agreement.

          General Account:

             "General Account" shall mean the account so named established
          under Section 4.01 hereof.

          Government Obligations:

             "Government Obligations" shall mean:

               (a) direct obligations of, or obligations the principal of
             and interest on which are unconditionally guaranteed by, the
             United States of America entitled to the benefit of the full
             faith and credit thereof; and

               (b) certificates, depositary receipts or other instruments
             which evidence a direct ownership interest in obligations
             described in clause (a) above or in any specific interest or
             principal payments due in respect thereof; provided, however,
             that the custodian of such obligations or specific interest or
             principal payments shall be a bank or trust company organized
             under the laws of the United States of America or of any state
             or territory thereof or of the District of Columbia, with a
             combined capital stock surplus and undivided profits of at
             least $50,000,000; and provided, further, that except as may
             be otherwise required by law, such custodian shall be
             obligated to pay to the holders of such certificates,
             depositary receipts or other instruments the full amount
             received by such custodian in respect of such obligations or
             specific payments and shall not be permitted to make any
             deduction therefrom.

          Indenture:

             "Indenture" shall mean this Indenture of Trust, dated as of
          September 15, 1997, between the Authority and the Trustee, and
          any and all modifications, alterations, amendments and
          supplements thereto.

          Investment Account:

             "Investment Account" shall mean any of the accounts so named
          established under Sections 4.01 and 5.01 hereof.

          Investment Securities:

             "Investment Securities" shall mean any of the following
          obligations or securities on which neither the Company nor any of
          its subsidiaries is the obligor: (a) Government Obligations; (b)
          interest bearing deposit accounts (which may be represented by
          certificates of deposit) in national, state or foreign banks
          having a combined capital and surplus of not less than
          $10,000,000; (c) bankers' acceptances drawn on and accepted by
          commercial banks having a combined capital and surplus of not
          less than $10,000,000; (d) (i) direct obligations of, (ii)
          obligations the principal of and interest on which are
          unconditionally guaranteed by, and (iii) any other obligations
          the interest on which is exempt from federal income taxation
          issued by, any state of the United States of America, the
          District of Columbia or the Commonwealth of Puerto Rico, or any
          political subdivision, agency, authority or other instrumentality
          of any of the foregoing, which, in any case, are rated by a
          nationally recognized rating agency in any of its three highest
          rating categories; (e) obligations of any agency or
          instrumentality of the United States of America; (f) commercial
          or finance company paper which is rated by a nationally
          recognized rating agency in any of its three highest rating
          categories; (g) corporate debt securities issued by corporations
          having debt securities rated by a nationally recognized rating
          agency in any of its three highest rating categories; (h)
          repurchase agreements with banking or financial institutions
          having a combined capital and surplus of not less than
          $10,000,000 with respect to any of the foregoing obligations or
          securities; (i) shares or interests in registered investment
          companies whose assets consist of obligations or securities which
          are described in any other clause of this sentence; and (j) any
          other obligations which may lawfully be purchased by the Trustee. 
          The commercial banks and banking institutions referred to above
          may include the entities acting as Trustee, Paying Agent,
          Co-Paying Agent and Registrar, hereunder if such entities shall
          otherwise satisfy the requirements set forth above.

          Loan Agreement:

             "Loan Agreement" shall mean the Loan Agreement, dated as of
          September 15, 1997, between the Authority and the Company
          relating to the Bonds, and any and all modifications,
          alterations, amendments and supplements thereto.

          Loan Payments:

             "Loan Payments" shall mean the payments required to be made by
          the Company pursuant to Section 5.01 of the Loan Agreement.

          1990 Bonds:

             "1990 Bonds" shall mean the $20,000,000 aggregate principal
          amount of the Authority's Industrial Development Revenue Bonds,
          1990 Series A (Tucson Electric Power Company Project).

          Notice by Mail:

             "Notice by Mail" or "notice" of any action or condition "by
          Mail" shall mean a written notice meeting the requirements of
          this Indenture mailed by first-class mail to the Owners of
          specified registered Bonds at the addresses shown in the
          registration books maintained pursuant to Section 2.08 hereof;
          provided, however, that if, because of the temporary or permanent
          suspension of delivery of first-class mail or for any other
          reason, it is impossible or impracticable to give such notice by
          first-class mail, then such giving of notice in lieu thereof,
          which may include publication, as shall be made with the approval
          of the Trustee (or, if there be no trustee hereunder, the
          Authority) shall constitute a sufficient giving of such notice.

          Notice by Publication:

             "Notice by Publication" or "notice" of any action or condition
          "by Publication" shall mean publication of a notice meeting the
          requirements of this Indenture in a newspaper or financial
          journal of general circulation in The City of New York, New York,
          which carries financial news, is printed in the English language
          and is customarily published on each business day; provided,
          however, that any successive weekly publication of notice
          required hereunder may be made, unless otherwise expressly
          provided herein, on the same or different days of the week and in
          the same or different newspapers or financial journals; and
          provided, further, that if, because of the temporary or permanent
          suspension of the publication or general circulation of any
          newspaper or financial journal or for any other reason, it is
          impossible or impracticable to publish such notice in the manner
          herein described, then such publication in lieu thereof as shall
          be made with the approval of the Trustee (or, if there be no
          trustee hereunder, the Authority) shall constitute a sufficient
          publication of such notice.

          Outstanding:

             "Outstanding", when used in reference to the Bonds, shall
          mean, as at any particular date, the aggregate of all Bonds
          authenticated and delivered under this Indenture except:

               (a) those canceled by the Trustee at or prior to such date
             or delivered to or acquired by the Trustee at or prior to such
             date for cancellation;

               (b) those deemed to be paid in accordance with Article VIII
             hereof; and

               (c) those in lieu of or in exchange or substitution for
             which other Bonds shall have been authenticated and delivered
             pursuant to this Indenture, unless proof satisfactory to the
             Trustee and the Company is presented that such Bonds are held
             by a bona fide holder in due course.

          Owner:

             "Owner" shall mean the person in whose name any Bond is
          registered upon the registration books maintained pursuant to
          Section 2.08 hereof.  The Company may be an Owner.

          Paying Agent; Co-Paying Agent; Principal Office thereof:

             "Paying Agent" and "Co-Paying Agent" shall mean the paying
          agent and any co-paying agent appointed in accordance with
          Section 10.21 hereof.  "Principal Office" of the Paying Agent or
          any Co-Paying Agent shall mean the office thereof designated in
          writing to the Trustee.

          Rebate Fund:

             "Rebate Fund" shall mean the fund created by Section 7.08
          hereof.

          Receipts and Revenues of the Authority from the Loan Agreement:

             "Receipts and Revenues of the Authority from the Loan
          Agreement" shall mean all moneys paid or payable to the Trustee
          for the account of the Authority by the Company in respect of the
          Loan Payments and payments pursuant to Section 9.01 of the Loan
          Agreement, and all receipts of the Trustee which, under the
          provisions of this Indenture, reduce the amount of such payments.

          Record Date:

             "Record Date" shall mean the close of business on the
          fifteenth (15th) day of the calendar month immediately preceding
          each regularly scheduled interest payment date.

          Registrar; Principal Office thereof:

             "Registrar" shall mean the registrar appointed in accordance
          with Section 10.23 hereof.  "Principal Office" of the Registrar
          shall mean the office thereof designated in writing to the
          Trustee.

          Supplemental Indenture:

             "Supplemental Indenture" shall mean any indenture of the
          Authority modifying, altering, amending, supplementing or
          confirming this Indenture for any purpose, in accordance with the
          terms hereof.

          Supplemental Loan Agreement:

             "Supplemental Loan Agreement" shall mean any agreement between
          the Authority and the Company modifying, altering, amending or
          supplementing the Loan Agreement, in accordance with the terms
          thereof and hereof.

          Tax Agreement:

             "Tax Agreement" shall mean that tax certificate and agreement,
          dated the date of the initial authentication and delivery of the
          Bonds, between the Authority and the Company, relating to the
          requirements of the Code, and any and all modifications,
          alterations, amendments and supplements thereto.

          Trust Estate:

             "Trust Estate" shall mean at any particular time all right,
          title and interest of the Authority in and to the Loan Agreement
          (except its rights under Sections 5.03, 5.04, 6.03 and 8.05
          thereof and any rights of the Authority to receive notices,
          certificates, requests, requisitions and other communications
          thereunder), including without limitation, the Receipts and
          Revenues of the Authority from the Loan Agreement, the Bond Fund
          and the Construction Fund and all moneys and Investment
          Securities from time to time on deposit therein (excluding,
          however, any moneys or Investment Securities held in the Rebate
          Fund), any and all other moneys and obligations (other than
          Bonds) which at such time are deposited or are required to be
          deposited with, or are held or are required to be held by or on
          behalf of, the Trustee, the Paying Agent or any Co-Paying Agent
          in trust under any of the provisions of this Indenture and all
          other rights, titles and interests which at such time are subject
          to the lien of this Indenture; provided, however, that in no
          event shall there be included in the Trust Estate (a) moneys or
          obligations deposited with or held by the Trustee in the Rebate
          Fund pursuant to Section 7.08 hereof or (b) moneys or obligations
          deposited with or paid to the Trustee for the redemption or
          payment of Bonds which are deemed to have been paid in accordance
          with Article VIII hereof or moneys held pursuant to Section 4.06
          hereof.

          Trustee; Principal Office thereof:

             "Trustee" shall mean First Trust of New York, National
          Association, as trustee under this Indenture, its successors in
          trust and their assigns.  "Principal Office" of the Trustee shall
          mean the principal corporate trust office of the Trustee, which
          office at the date of acceptance by the Trustee of the duties and
          obligations imposed on the Trustee by this Indenture is located
          at the address specified in Section 13.08 hereof.


                                      ARTICLE II

                                      THE BONDS

             Section 2.01.  Creation of Bonds.  There is hereby authorized
          and created under this Indenture, for the purpose of providing
          moneys to pay a part of the Cost of Construction and for the
          purpose of refinancing the 1990 Bonds, an issue of Bonds,
          entitled to the benefit, protection and security of this
          Indenture, in the aggregate principal amount of Twenty-two
          Million Four Hundred Sixty Thousand Dollars ($22,460,000).  Each
          of the Bonds shall be designated by the title "The Industrial
          Development Authority of the County of Pima Industrial
          Development Revenue Bond, 1997 Series A (Tucson Electric Power
          Company Project)".  The Bonds shall mature, subject to prior
          redemption upon the terms and conditions hereinafter set forth,
          on September 1, 2025 and shall bear interest from the date
          thereof until payment of the principal or redemption price
          thereof shall have been made or provided for in accordance with
          the provisions hereof, whether at maturity, upon redemption or
          otherwise, at the rate of six and one-tenth per centum (6.10%)
          per annum, with interest thereon payable semi-annually on each
          March 1 and September 1, commencing March 1, 1998.  Interest
          shall be calculated on the basis of a 360-day year consisting of
          twelve 30-day months.

             Section 2.02.  Form of Bonds.  Bonds shall be authenticated
          and delivered hereunder solely as fully registered bonds without
          coupons in the denomination of $5,000 or integral multiples
          thereof.  Bonds shall be numbered as determined by the Trustee. 
          Bonds authenticated prior to the first interest payment date
          shall be dated September 15, 1997.  Bonds authenticated on or
          subsequent to the first interest payment date shall be dated the
          interest payment date next preceding the date of authentication
          thereof, unless such date of authentication shall be an interest
          payment date to which interest on the Bonds has been paid in full
          or duly provided for, in which case they shall be dated such date
          of authentication; provided, however, that if, as shown by the
          records of the Trustee, interest on the Bonds shall be in
          default, Bonds issued in exchange for Bonds surrendered for
          transfer or exchange shall be dated the date to which interest
          has been paid in full on the Bonds surrendered.

             Principal of and premium, if any, on Bonds shall be payable to
          the Owners of such Bonds upon presentation and surrender of such
          Bonds at the Principal Office of the Paying Agent or any
          Co-Paying Agent.  Interest on the Bonds shall be paid by check
          drawn upon the Paying Agent and mailed to the Owners of such
          Bonds as of the close of business on the Record Date with respect
          to each interest payment date at the registered addresses of such
          Owners as they shall appear as of the close of business on such
          Record Date on the registration books maintained pursuant to
          Section 2.08 hereof notwithstanding the cancellation of any such
          Bond upon any exchange or registration of transfer subsequent to
          such Record Date, except that if and to the extent that there
          should be a default on the payment of interest on any Bond, such
          defaulted interest shall be paid to the Owners in whose name such
          Bond (or any Bond or Bonds issued upon any exchange or
          registration of transfer thereof) is registered as of the close
          of business on a date selected by the Trustee in its discretion,
          but not more than 15 days or less than 10 days prior to the date
          of payment of such defaulted interest; notwithstanding the
          foregoing, upon request to the Paying Agent by an Owner of not
          less than $1,000,000 in aggregate principal amount of Bonds,
          interest on such Bonds and, after presentation and surrender of
          such Bonds, the principal thereof shall be paid to such Owner by
          wire transfer to the account maintained within the continental
          United States specified by such Owner or, if such Owner maintains
          an account with the entity acting as Paying Agent, by deposit
          into such account.  Payment as aforesaid shall be made in such
          coin or currency of the United States of America as, at the
          respective times of payment, shall be legal tender for the
          payment of public and private debts.

             The Bonds and the form for registration of transfer and the
          form of certificate of authentication to be printed on the Bonds
          are to be in substantially the forms thereof set forth in
          Exhibits A, B and C hereto, respectively, with necessary or
          appropriate variations, omissions and insertions as permitted or
          required by this Indenture.

             Section 2.03.  Execution of Bonds.  The Bonds shall be
          executed on behalf of the Authority by the President or a Vice
          President of the Authority and shall have affixed, impressed or
          reproduced thereon the official seal of the Authority which shall
          be attested by the Secretary or an Assistant Secretary of the
          Authority.  Each of the foregoing officers may execute or cause
          to be executed with a facsimile signature in lieu of his manual
          signature the Bonds, provided the signature of either the
          President or a Vice President of the Authority or the Secretary
          or Assistant Secretary of the Authority shall, if required by
          applicable laws, be manually subscribed.

             In case any officer of the Authority whose signature or a
          facsimile of whose signature shall appear on the Bonds shall
          cease to be such officer before the authentication by the Trustee
          and delivery of such Bonds, such signature or such facsimile
          shall nevertheless be valid and sufficient for all purposes, the
          same as if such officer had remained in office until delivery;
          and any Bond may be signed on behalf of the Authority by such
          persons as, at the time of execution of such Bond, shall be the
          proper officers of the Authority, even though at the date of such
          Bond or of the execution and delivery of this Indenture any such
          person was not such officer.

             Section 2.04.  Authentication of Bonds.  Only such Bonds as
          shall have endorsed thereon a certificate of authentication
          substantially in the form set forth in Exhibit C hereto duly
          executed by the Trustee shall be entitled to any right or benefit
          under this Indenture.  No Bond shall be valid or obligatory for
          any purpose unless and until such certificate of authentication
          shall have been duly executed by the Trustee, and such executed
          certificate of authentication of the Trustee upon any such Bonds
          shall be conclusive evidence that such Bond has been
          authenticated and delivered under this Indenture.  The Trustee's
          certificate of authentication on any Bond shall be deemed to have
          been executed by it if signed with an authorized signature of the
          Trustee, but it shall not be necessary that the same person sign
          the certificate of authentication on all of the Bonds issued
          hereunder.  This Section 2.04 is subject to the provisions of
          Section 10.17 hereof.

             Section 2.05.  Bonds Not General Obligations.  Neither Pima
          County, Arizona nor the State of Arizona shall in any event be
          liable for the payment of the principal of or premium, if any, or
          interest on the Bonds, and neither the Bonds nor the premium, if
          any, or the interest thereon, shall be construed to constitute an
          indebtedness of Pima County, Arizona or the State of Arizona
          within the meaning of any constitutional or statutory provisions
          whatsoever.  The Bonds and the premium, if any, and the interest
          thereon shall be limited obligations of the Authority payable
          solely from the Receipts and Revenues of the Authority from the
          Loan Agreement and the other moneys pledged therefor under this
          Indenture, and such fact shall be plainly stated on the face of
          each Bond.

             Section 2.06.  Prerequisites to Authentication of Bonds.  The
          Authority shall execute and deliver to the Trustee and the
          Trustee shall authenticate the Bonds and deliver said Bonds to
          the initial purchasers thereof as may be directed hereinafter in
          this Section 2.06.

             Prior to the delivery on original issuance by the Trustee of
          any authenticated Bonds there shall be or have been delivered to
          the Trustee:

               (a) a duly certified copy of a resolution of the Board of
             Directors of the Authority authorizing the execution and
             delivery of this Indenture and the Loan Agreement and the
             issuance of the Bonds;

               (b) an original duly executed counterpart or a duly
             certified copy of the Loan Agreement;

               (c) a request and authorization to the Trustee on behalf of
             the Authority, signed by its President or a Vice President, to
             authenticate and deliver the Bonds in the aggregate principal
             amount determined by this Indenture to the purchaser or
             purchasers therein identified upon payment to the Trustee, but
             for the account of the Authority, of a sum specified in such
             request and authorization plus any accrued interest on such
             Bonds to the date of delivery; and

               (d) a written statement on behalf of the Company, executed
             by the President, any Vice President or the Treasurer, (i)
             approving the issuance and delivery of the Bonds and (ii)
             consenting to each and every provision of this Indenture.

             Section 2.07.  Lost or Destroyed Bonds or Bonds Canceled in
          Error.  If any Bond, whether in temporary or definitive form, is
          lost (whether by reason of theft or otherwise), destroyed
          (whether by mutilation, damage, in whole or in part, or
          otherwise) or canceled in error, the Authority may execute and
          the Trustee may authenticate a new Bond of like date and
          denomination and bearing a number not contemporaneously
          outstanding; provided that (a) in the case of any mutilated Bond,
          such mutilated Bond shall first be surrendered to the Trustee and
          (b) in the case of any lost Bond or Bond destroyed in whole,
          there shall be first furnished to the Authority, the Trustee and
          the Company evidence of such loss or destruction.  In every case,
          the applicant for a substitute Bond shall furnish the Authority,
          the Trustee and the Company such security or indemnity as may be
          required by any of them.  In the event any lost or destroyed Bond
          or a Bond canceled in error shall have matured or is about to
          mature, or has been called for redemption, instead of issuing a
          substitute Bond the Trustee may, in its discretion, pay the same
          without surrender thereof if there shall be first furnished to
          the Authority, the Trustee and the Company evidence of such loss,
          destruction or cancellation, together with indemnity,
          satisfactory to them.  Upon the issuance of any substitute Bond,
          the Authority and the Trustee may require the payment of a sum
          sufficient to cover any tax or other governmental charge that may
          be imposed in relation thereto.  The Trustee may charge the Owner
          of any such Bond with the Trustee's reasonable fees and expenses
          in connection with any transaction described in this Section
          2.07.

             Every substitute Bond issued pursuant to the provisions of
          this Section 2.07 by virtue of the fact that any Bond is lost,
          destroyed or canceled in error shall constitute an additional
          contractual obligation of the Authority, whether or not the Bond
          so lost, destroyed or canceled shall be at any time enforceable,
          and shall be entitled to all the benefits of this Indenture
          equally and proportionately with any and all other Bonds duly
          issued hereunder.  All Bonds 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 lost, destroyed or improperly canceled
          Bonds, notwithstanding any law or statute now existing or
          hereafter enacted.

             Section 2.08.  Transfer, Registration and Exchange of Bonds. 
          The Registrar shall maintain and keep, at its Principal Office,
          books for the registration and registration of transfer of Bonds,
          which, at all reasonable times, shall be open for inspection by
          the Authority, the Trustee and the Company; and, upon
          presentation for such purpose of any Bond entitled to
          registration or registration of transfer at the Principal Office
          of the Registrar, the Registrar shall register or register the
          transfer in such books,  under such reasonable regulations as the
          Registrar may prescribe.  The Registrar shall make all necessary
          provisions to permit the exchange or registration of transfer of
          Bonds at its Principal Office.

             The transfer of any Bond shall be registered upon the
          registration books of the Registrar at the written request of the
          Owner thereof or his attorney duly authorized in writing, upon
          surrender thereof at the Principal Office of the Registrar,
          together with a written instrument of transfer satisfactory to
          the Registrar duly executed by the Owner or his duly authorized
          attorney.  Upon the registration of transfer of any such Bond or
          Bonds, the Authority shall issue in the name of the transferee,
          in authorized denominations, a new Bond or Bonds in the same
          aggregate principal amount as the surrendered Bond or Bonds.

             The Authority, the Trustee, the Paying Agent, any Co-Paying
          Agent and the Registrar may deem and treat the Owner of any Bond
          as the absolute owner of such Bond, whether such Bond shall be
          overdue or not, for the purpose of receiving payment of, or on
          account of, the principal of and premium, if any, and, except as
          provided in Section 2.02 hereof, interest on such Bond and for
          all other purposes, and neither the Authority, the Trustee, the
          Paying Agent, any Co-Paying Agent nor the Registrar shall be
          affected by any notice to the contrary.  All such payments so
          made to any such Owner or upon his order shall be valid and
          effective to satisfy and discharge the liability upon such Bond
          to the extent of the sum or sums so paid.

             Bonds, upon surrender thereof at the Principal Office of the
          Registrar may, at the option of the Owner thereof, be exchanged
          for an equal aggregate principal amount of Bonds of any
          authorized denomination.

             In all cases in which the privilege of exchanging Bonds or
          registering the transfer of Bonds is exercised, the Authority
          shall execute and the Trustee shall authenticate and deliver
          Bonds in accordance with the provisions of this Indenture.  For
          every such exchange or registration of transfer of Bonds, whether
          temporary or definitive, the Authority, the Registrar, or the
          Trustee may make a charge sufficient to reimburse it for any tax
          or other governmental charge required to be paid with respect to
          such exchange or registration of transfer, which sum or sums
          shall be paid by the person requesting such exchange or
          registration of transfer as a condition precedent to the exercise
          of the privilege of making such exchange or registration of
          transfer.  The Registrar shall not be obligated (a) to make any
          such exchange or registration of transfer of Bonds during the
          fifteen (15) days next preceding the date on which notice of any
          proposed redemption of Bonds is given or (b) to make any exchange
          or registration of transfer of any Bonds called for redemption.

             The Bonds are to be initially registered in the name of Cede &
          Co., as nominee for the Depositary.  Such Bonds shall not be
          transferable or exchangeable, nor shall any purported transfer be
          registered, except as follows:

               (a) such Bonds may be transferred in whole, and appropriate
             registration of transfer effected, if such transfer is by such
             nominee to the Depositary, or by the Depositary to another
             nominee thereof, or by any nominee of the Depositary to any
             other nominee thereof, or by the Depositary or any nominee
             thereof to any successor securities depositary or any nominee
             thereof; and

               (b) such Bond may be exchanged for definitive Bonds
             registered in the respective names of the beneficial holders
             thereof, and thereafter shall be transferable without
             restriction, if:

                  (i)  the Depositary shall have notified the Company and
               the Trustee that it is unwilling or unable to continue to
               act as securities depositary with respect to such Bonds and
               the Trustee shall not have been notified by the Company
               within ninety (90) days of the identity of a successor
               securities depositary with respect to such Bonds;

                  (ii)  the Company shall have delivered to the Trustee a
               written instrument to the effect that such Bonds shall be so
               exchangeable on and after a date specified therein; or

                  (iii)  (1) an Event of Default shall have occurred and be
               continuing, (2) the Trustee shall have given notice of such
               Event of Default pursuant to Section 10.19 hereof and (3)
               there shall have been delivered to the Authority, the
               Company and the Trustee an opinion of counsel to the effect
               that the interests of the beneficial owners of such Bonds in
               respect thereof will be materially impaired unless such
               owners become owners of definitive Bonds.

             The Bonds delivered to the Depositary may contain a legend
          reflecting the foregoing restrictions on registration of transfer
          and exchange.

             Section 2.09.  Other Obligations.  The Authority expressly
          reserves the right to issue, to the extent permitted by law, but
          shall not be obligated to issue, obligations under another
          indenture or indentures to provide additional funds to pay the
          Cost of Construction of the Facilities or to refund all or any
          principal amount of the Bonds, or any combination thereof.

             Section 2.10   Temporary Bonds.  Pending the preparation of
          definitive Bonds, the Authority may execute and the Trustee shall
          authenticate and deliver temporary Bonds.  Temporary Bonds shall
          be issuable as registered Bonds without coupons, of any
          authorized denomination, and substantially in the form of the
          definitive Bonds but with such omissions, insertions and
          variations as may be appropriate for temporary Bonds, all as may
          be determined by the Authority.  Temporary Bonds may contain such
          reference to any provisions of this Indenture as may be
          appropriate.  Every temporary Bond shall be executed by the
          Authority and be authenticated by the Trustee upon the same
          conditions and in substantially the same manner, and with like
          effect, as the definitive Bonds.  As promptly as practicable the
          Authority shall execute and shall furnish definitive Bonds and
          thereupon temporary Bonds may be surrendered in exchange therefor
          without charge at the Principal Office of the Trustee, and the
          Trustee shall authenticate and deliver in exchange for such
          temporary Bonds a like aggregate principal amount of definitive
          Bonds of authorized denominations.  Until so exchanged the
          temporary Bonds shall be entitled to the same benefits under this
          Indenture as definitive Bonds.

             Section 2.11.  Cancellation of Bonds.  All Bonds which shall
          have been surrendered to the Paying Agent or any Co-Paying Agent
          for payment or redemption, and all Bonds which shall have been
          surrendered to the Registrar for exchange or registration of
          transfer, shall be delivered to the Trustee for cancellation. 
          All Bonds delivered to or acquired by the Trustee for
          cancellation shall be canceled and destroyed by the Trustee.  The
          Trustee shall furnish to the Authority, the Paying Agent, the
          Registrar and the Company counterparts of certificates evidencing
          such cancellation and destruction and specifying such Bonds by
          number.

             Section 2.12.  Payment of Principal and Interest.  For the
          payment of interest on the Bonds, the Authority shall cause to be
          deposited in the Bond Fund, on each interest payment date, solely
          out of the Receipts and Revenues of the Authority from the Loan
          Agreement and other moneys pledged therefor, an amount sufficient
          to pay the interest to become due on such interest payment date. 
          The obligation of the Authority to cause any such deposit to be
          made hereunder shall be reduced by the amount of moneys in the
          Bond Fund available on such interest payment date for the payment
          of interest on the Bonds.

             For the payment of the principal of the Bonds upon maturity,
          the Authority shall cause to be deposited in the Bond Fund, on
          the stated or accelerated date of maturity, solely out of the
          Receipts and Revenues of the Authority from the Loan Agreement
          and other moneys pledged therefor, an amount sufficient to pay
          the principal of the Bonds.  The obligation of the Authority to
          cause any such deposit to be made hereunder shall be reduced by
          the amount of moneys in the Bond Fund available on the maturity
          date for the payment of the principal of the Bonds.

             Section 2.13.  Applicability of Book-Entry Provisions.
          Anything in this Indenture to the contrary notwithstanding, (a)
          the provisions of the Blanket Issuer Letter of Representations,
          dated February 26, 1996, between the Authority and The Depository
          Trust Company relating to the manner of and procedures for
          payment and redemption of Bonds and related matters shall apply
          so long as such Depositary shall be the Owner of all Outstanding
          Bonds and (b) the Authority, the Trustee or the Paying Agent, as
          applicable,  may enter into a similar agreement, on terms
          satisfactory to the Company, with any subsequent Depositary and
          the provisions thereof shall apply so long as such Depositary
          shall be the Owner of all Outstanding Bonds.

                                     ARTICLE III

                                 REDEMPTION OF BONDS

             Section 3.01.  Redemption Provisions.  (a)  The Bonds shall be
          subject to redemption by the Authority, at the direction of the
          Company, on any date on or after September 1, 2002 in whole at
          any time or in part from time to time, at the applicable
          redemption price (expressed as a percentage of principal amount)
          set forth below, plus accrued interest to the redemption date:

                  Redemption Period         Redemption Price
                  -----------------         ----------------
           September 1, 2002 through             102%
             August 31, 2003
           September 1, 2003 through             101%
             August 31, 2004
           September 1, 2004 and                 100%
             thereafter

               (b)  The Bonds shall be subject to redemption by the
             Authority, at the direction of the Company, in whole at any
             time at the principal amount thereof plus accrued interest to
             the redemption date, if:

                  (i)  the Company shall have determined that the continued
               operation of the Facilities is impracticable, uneconomical
               or undesirable for any reason;

                  (ii)  all or substantially all of the Facilities shall
               have been condemned or taken by eminent domain; or

                  (iii)  the operation of the Facilities shall have been
               enjoined or shall have otherwise been prohibited by, or
               shall conflict with, any order, decree, rule or regulation
               of any court or of any federal, state or local regulatory
               body, administrative agency or other governmental body.

               (c)  The Bonds shall be subject to mandatory redemption by
             the Authority, at the principal amount thereof plus accrued
             interest to the redemption date, on the 180th day (or such
             earlier date as may be designated by the Company) after a
             final determination by a court of competent jurisdiction or an
             administrative agency, to the effect that, as a result of a
             failure by the Company to perform or observe any covenant,
             agreement or representation contained in the Loan Agreement,
             the interest payable on the Bonds is included for federal
             income tax purposes in the gross income of the owners thereof,
             other than any owner of a Bond who is a "substantial user" of
             the Facilities or a "related person" within the meaning of
             Section 147(a) of the Code.  No determination by any court or
             administrative agency shall be considered final for the
             purposes of this Section 3.01 (c) unless the Company shall
             have been given timely notice of the proceeding which resulted
             in such determination and an opportunity to participate in
             such proceeding, either directly or through an owner of a
             Bond, and until the conclusion of any appellate review sought
             by any party to such proceeding or the expiration of the time
             for seeking such review. The Bonds shall be redeemed either in
             whole or in part in such principal amount that, in the opinion
             of Bond Counsel, the interest payable on the Bonds, including
             the Bonds remaining outstanding after such redemption, would
             not be included in the gross income of any owner thereof,
             other than an owner of a Bond who is a "substantial user" of
             the Facilities or a "related person" within the meaning of
             Section 147(a) of the Code.

               (d)  In the event that the aggregate of the amounts
             deposited pursuant to Section 5.02 hereof into the Capital
             Account and the Investment Account maintained within the Bond
             Fund, together with any income or other gain from the
             investment thereof, shall at any time, or from time to time,
             be equal to or greater than $5,000, but only to the extent
             that such amounts are required under Section 4.04(b) hereof to
             be applied to the redemption of Bonds, the Authority shall
             redeem Bonds, at the principal amount thereof plus accrued
             interest to the redemption date, in the largest aggregate
             principal amount which does not exceed the amount of such
             deposit or deposits, together with such income or gain, on the
             next interest payment date on which a redemption may be made
             in accordance with the provisions of Section 3.03(a) or (b)
             hereof and on which Bonds, in such amount, are otherwise
             redeemable at the principal amount thereof under subsection
             (a) or (b) of this Section 3.01.

             Section 3.02.  Selection of Bonds to be Redeemed.  If less
          than all the Bonds shall be called for redemption under any
          provision of this Indenture permitting such partial redemption,
          the particular Bonds or portions of Bonds to be redeemed shall be
          selected by the Trustee, in such manner as the Trustee in its
          discretion may deem proper, in the aggregate principal amount
          designated to the Trustee by the Company or otherwise as required
          by this Indenture; provided, however, that if, as indicated in a
          certificate of an Authorized Company Representative delivered to
          the Trustee, the Company shall have offered to purchase all Bonds
          then Outstanding and less than all such Bonds have been tendered
          to the Company for such purchase, the Trustee, at the direction
          of an Authorized Company Representative, shall select for
          redemption all such Bonds which shall not have been so tendered;
          and provided, further, that the portion of any Bond to be
          redeemed shall be in the principal amount of $5,000 or some
          integral multiple thereof and that, in selecting Bonds for
          redemption, the Trustee shall treat each Bond as representing
          that number of Bonds which is obtained by dividing the principal
          amount of such Bond by $5,000.  If it is determined that one or
          more, but not all, of the $5,000 units of principal amount
          represented by any such Bond is to be called for redemption,
          then, upon notice of intention to redeem such $5,000 unit or
          units, the Owner of such Bond shall forthwith surrender such Bond
          to the Paying Agent or any Co-Paying Agent for (y) payment to
          such Owner of the redemption price (including the redemption
          premium, if any, and accrued interest to the date fixed for
          redemption) of the $5,000 unit or units of principal amount
          called for redemption and (z) delivery to such Owner of a new
          Bond or Bonds in the aggregate principal amount of the unredeemed
          balance of the principal amount of any such Bond.  Bonds
          representing the unredeemed balance of the principal amount of
          any such Bond shall be delivered to the Owner thereof, without
          charge therefor.  If the Owner of any such Bond of a denomination
          greater than $5,000 shall fail to present such Bond to the Paying
          Agent or any Co-Paying Agent for payment and exchange as
          aforesaid, such Bond shall, nevertheless, become due and payable
          on the date fixed for redemption to the extent of the $5,000 unit
          or units of principal amount called for redemption (and to that
          extent only).

             Section 3.03.  Procedure for Redemption.  (a) In the event any
          of the Bonds are called for redemption, the Trustee shall give
          notice, in the name of the Authority, of the redemption of such
          Bonds, which notice shall (i) specify the Bonds to be redeemed,
          the redemption date, the redemption price, and the place or
          places where amounts due upon such redemption will be payable
          (which shall be the Principal Office of the Paying Agent or any
          Co-Paying Agent) and, if less than all of the Bonds are to be
          redeemed, the numbers of the Bonds to be redeemed, and the
          portion of the principal amount of any Bond to be redeemed in
          part, (ii) state any condition to such redemption and (iii) state
          that on the redemption date, and upon the satisfaction of any
          such condition, the Bonds or portions thereof to be redeemed
          shall cease to bear interest.  Such notice may set forth any
          additional information relating to such redemption.  Such notice
          shall be given by Mail at least thirty (30) days prior to the
          date fixed for redemption to the Owners of the Bonds to be
          redeemed; provided, however, that failure duly to give such
          Notice by Mail, or any defect therein, shall not affect the
          validity of any proceedings for the redemption of Bonds as to
          which there shall have been no such failure or defect.  If a
          notice of redemption shall be unconditional, or if the conditions
          of a conditional notice or redemption shall have been satisfied,
          then upon presentation and surrender of Bonds so called for
          redemption at the place or places of payment, such Bonds shall be
          redeemed.  The Trustee shall promptly deliver to the Company a
          copy of each such notice of redemption.

               (b) With respect to any notice of redemption of Bonds in
             accordance with subsection (a) or (b) of Section 3.01 hereof,
             unless, upon the giving of such notice, such Bonds shall be
             deemed to have been paid within the meaning of Article VIII
             hereof, such notice shall state that such redemption shall be
             conditional upon the receipt, by the Trustee at or prior to
             the opening of business on the date fixed for such redemption,
             of moneys sufficient to pay the principal of and premium, if
             any, and interest on such Bonds to be redeemed, and that if
             such moneys shall not have been so received said notice shall
             be of no force and effect and the Authority shall not be
             required to redeem such Bonds.  In the event that such notice
             of redemption contains such a condition and such moneys are
             not so received, the redemption shall not be made and the
             Trustee shall within a reasonable time thereafter give notice,
             in the manner in which the notice of redemption was given,
             that such moneys were not so received.

               (c)  Any Bonds and portions of Bonds which have been duly
             selected for redemption shall cease to bear interest on the
             specified redemption date provided that moneys sufficient to
             pay the principal of, premium, if any, and interest on such
             Bonds shall be on deposit with the Trustee on the date fixed
             for redemption so that such Bonds will be deemed to be paid in
             accordance with Article VIII hereof.

             Section 3.04.  Payment of Redemption Price.  For the
          redemption of any of the Bonds, the Authority shall cause to be
          deposited in the Bond Fund, on the redemption date, solely out of
          the Receipts and Revenues of the Authority from the Loan
          Agreement, an amount sufficient to pay the principal of and
          premium, if any, and interest to become due on such redemption
          date.  The obligation of the Authority to cause any such deposit
          to be made hereunder shall be reduced by the amount of moneys in
          the Bond Fund available on such redemption date for payment of
          the principal of and premium, if any, and accrued interest on the
          Bonds to be redeemed.

             Section 3.05.  No Partial Redemption After Default.  Anything
          in this Indenture to the contrary notwithstanding, if there shall
          have occurred and be continuing an Event of Default defined in
          clause (a) or (b) of the first paragraph of Section 9.01 hereof,
          there shall be no redemption of less than all of the Bonds at the
          time Outstanding other than a partial redemption in connection
          with an offer by the Company to purchase all Bonds Outstanding as
          contemplated in the first proviso to the first sentence of
          Section 3.02 hereof.


                                      ARTICLE IV

                                    THE BOND FUND

             Section 4.01.  Creation of Bond Fund.  There is hereby created
          and established with the Trustee a trust fund in the name of the
          Authority to be designated "The Industrial Development Authority
          of The County of Pima Industrial Development Revenue Bonds, 1997
          Series A (Tucson Electric Power Company Project) Bond Fund".  The
          Trustee shall establish and maintain within the Bond Fund a
          "Capital Account", an "Investment Account" and a "General
          Account".  In addition, the Trustee shall establish and maintain
          such segregated subaccounts within the Capital Account or the
          Investment Account and such other segregated subaccounts within
          the Bond Fund as may be requested by an Authorized Company
          Representative.  The Bond Fund, and all moneys and certificated
          securities therein, shall be kept in the possession of the
          Trustee.

             Section 4.02.  Liens.  The Authority shall not create any lien
          upon the Bond Fund or upon the Receipts and Revenues of the
          Authority from the Loan Agreement other than the lien hereby
          created.

             Section 4.03.  Deposits into Bond Fund.  (a) There shall be
          deposited into the Bond Fund:

                  (i) the accrued interest, if any, on the Bonds accrued to
               the date of delivery thereof and paid by the initial
               purchasers thereof, such accrued interest to be deposited
               into the General Account;

                  (ii) all amounts required to be deposited into the Bond
               Fund by Section 5.02 hereof, such amounts to be deposited
               into the Capital Account or the Investment Account;

                  (iii) all amounts required to be deposited into the Bond
               Fund by Sections 5.03 and 5.04 hereof, such amounts to be
               deposited into the General Account;

                  (iv) all Loan Payments, such payments and moneys to be
               deposited into the General Account; and

                  (v) all other moneys received by the Trustee under and
               pursuant to any provision of the Loan Agreement, other than
               Sections 5.03, 5.04 and 8.05 thereof, or from any other
               source when accompanied by directions by the Company that
               such moneys are to be paid into the Bond Fund, such moneys
               to be deposited into the account specified by such provision
               of the Loan Agreement or by such directions, or, if no
               specification is made, into the General Account.

               (b) All income or other gain from the investment of moneys
             in the Capital Account or the Investment Account shall be
             deposited into the Investment Account.  All income or other
             gain from the investment of moneys in the General Account
             shall be deposited into the General Account.

             Section 4.04.  Use of Moneys in Bond Fund.  (a)   Moneys, if
          any, paid into the Bond Fund pursuant to clause (i) of Section
          4.03(a) hereof shall be applied to the payment of interest on the
          Bonds.  Except as otherwise provided in Sections 4.06, 9.01 and
          10.04 hereof, all other moneys in the Bond Fund constituting part
          of the Trust Estate shall be used solely for the payment of the
          principal of and premium, if any, and interest on the Bonds as
          the same shall become due and payable at maturity, upon
          redemption or otherwise.  

               (b) Moneys deposited pursuant to Section 5.02 hereof into
             the Capital Account or the Investment Account maintained
             within the Bond Fund, and any income or other gain from the
             investment thereof, shall be applied by the Trustee (i) in
             whole or in part (A) to the purchase of Bonds in such amounts,
             at such prices, at such times and otherwise as directed by an
             Authorized Company Representative, or to the redemption, at
             the direction of the Company, of Bonds pursuant to subsection
             (a) or, if applicable, (b) or (e) of Section 3.01 hereof or
             (B) in any other manner directed by an Authorized Company
             Representative which, as indicated in an opinion of Bond
             Counsel furnished by the Company to the Authority and the
             Trustee, will not, in and of itself, impair the validity under
             the Act of the Bonds or the exclusion of the interest on the
             Bonds from gross income for federal income tax purposes, or,
             in the absence of any such purchase, redemption or direction
             on or prior to the forty-fifth (45th) day prior to the first
             interest payment date specified in Section 3.01(d) hereof,
             (ii) to the payment of principal upon the redemption, from
             time to time, of Bonds pursuant to Section 3.01(d) hereof, any
             moneys which are not so applied to be retained in the accounts
             into which they were deposited and applied by the Trustee to
             the payment of principal of Bonds either at maturity or upon
             the redemption of all or any portion of the Bonds, whichever
             occurs first.  Pending the application of moneys deposited
             into the Bond Fund pursuant to Section 5.02 hereof, such
             moneys may be invested in Investment Securities in the manner
             permitted by Section 6.01 hereof, provided that such
             investment shall not produce a yield greater than the yield on
             the Bonds unless, as indicated in an opinion of Bond Counsel
             furnished by the Company to the Authority and the Trustee,
             investments producing a greater yield would not, in and of
             itself, impair the exclusion from gross income for federal tax
             purposes of the interest on the Bonds.

               (c) In the event that all of the Bonds cease to be
             Outstanding, any moneys remaining in the Capital Account or
             the Investment Account shall be deposited into the General
             Account.

             Section 4.05.  Custody of Bond Fund; Withdrawal of Moneys. 
          The Bond Fund shall be in the custody of the Trustee but in the
          name of the Authority and the Authority hereby authorizes and
          directs the Trustee to withdraw from the Bond Fund and furnish to
          the Paying Agent funds constituting part of the Trust Estate
          sufficient to pay the principal of and premium, if any, and
          interest on the Bonds as the same shall become due and payable,
          and to withdraw from the Bond Fund funds sufficient to pay any
          other amounts payable therefrom as the same shall become due and
          payable.

             Section 4.06.  Bonds Not Presented for Payment.  In the event
          any Bonds shall not be presented for payment when the principal
          thereof and premium, if any, thereon become due, either at
          maturity or at the date fixed for redemption thereof or
          otherwise, if moneys sufficient to pay such Bonds are held by the
          Paying Agent or any Co-Paying Agent for the benefit of the Owners
          thereof, the Paying Agent shall segregate and hold such moneys in
          trust, without liability for interest thereon, for the benefit of
          the Owners of such Bonds, who shall, except as provided in the
          following paragraph, thereafter be restricted exclusively to such
          fund or funds for the satisfaction of any claim of whatever
          nature on their part under this Indenture or relating to said
          Bonds.

             Any moneys which the Paying Agent shall segregate and hold in
          trust for the payment of the principal of and premium, if any, or
          interest on any Bond and remaining unclaimed for one year after
          such principal, premium, if any, or interest has become due and
          payable shall, upon the Company's written request to the Paying
          Agent, be paid to the Company, with notice to the Trustee of such
          action; provided, however, that before the Paying Agent shall be
          required to make any such repayment, the Paying Agent shall, at
          the expense of the Company cause notice to be given once by
          Publication to the effect that such money remains unclaimed and
          that, after a date specified therein, which shall not be less
          than thirty (30) days from the date of such notice by
          Publication, any unclaimed balance of such moneys then remaining
          will be paid to the Company.  After the payment of such unclaimed
          moneys to the Company, the Owner of such Bond shall thereafter
          look only to the Company for the payment thereof, and all
          liability of the Authority, the Trustee and the Paying Agent with
          respect to such moneys shall thereupon cease.

             Section 4.07.  Moneys Held in Trust.  All moneys and
          Investment Securities held by the Trustee in the Bond Fund, and
          all moneys required to be deposited with or paid to the Trustee
          for deposit into the Bond Fund, and all moneys withdrawn from the
          Bond Fund and held by the Trustee, the Paying Agent, any
          Co-Paying Agent, shall be held by the Trustee, the Paying Agent
          or any Co-Paying Agent, as the case may be, in trust, and such
          moneys and Investment Securities (other than moneys held pursuant
          to Section 4.06 hereof and moneys or Investment Securities held
          in the Rebate Fund established in furtherance of the obligations
          of the Company under clause (b) of Section 6.04 of the Loan
          Agreement), while so held or so required to be deposited or paid,
          shall constitute part of the Trust Estate and be subject to the
          lien and security interest created hereby in favor of the Trustee
          for the benefit of the Owners from time to time of the Bonds. 
          The Company shall have no right, title or interest in the Bond
          Fund, except such rights as may arise after the right, title and
          interest of the Trustee in and to the Trust Estate and all
          covenants, agreements and other obligations of the Authority
          under this Indenture shall have ceased, terminated and become
          void and shall have been satisfied and discharged in accordance
          with Article VIII hereof.


                                      ARTICLE V

                                THE CONSTRUCTION FUND

             Section 5.01.  Creation of, and Disbursements from,
          Construction Fund.  (a) There is hereby created and established
          with the Trustee a trust fund in the name of the Authority to be
          designated "The Industrial Development Authority of the County of
          Pima Industrial Development Revenue Bonds, 1997 Series A (Tucson
          Electric Power Company Project) Construction Fund".  The Trustee
          shall establish and maintain within the Construction Fund a
          "Capital Account" and an "Investment Account".  The Trustee shall
          establish and maintain any subaccount within the Capital Account
          or the Investment Account which may be requested by an Authorized
          Company Representative.  The Construction Fund, and all moneys
          and certificated securities therein, shall be kept in the
          possession of the Trustee.  The Authority shall not create any
          lien upon the Construction Fund other than the lien hereby
          created.

               (b) The proceeds from the issuance and sale of the Bonds,
             other than the $20,000,000 deposited in escrow with the
             trustee for the 1990 Bonds as provided in Section 4.03 of the
             Loan Agreement and accrued interest, if any, on such Bonds to
             the date of delivery thereof paid by the initial purchasers
             thereof, shall be deposited into the Capital Account.  All
             income or other gain from the investment of moneys in the
             Capital Account or the Investment Account shall be deposited
             into the Investment Account.  In the event that all or a
             portion of the proceeds of the Bonds shall have been applied
             to the payment or redemption, or provision therefor, of any
             obligations issued by the Authority other than Bonds, any
             balance remaining in the construction, acquisition or other
             similar fund maintained in respect of such obligations, which
             balance shall have been delivered to the Trustee accompanied
             by a direction of the Company that such balance be deposited
             into the Construction Fund, shall be deposited into the
             Capital Account and the Investment Account in accordance with
             such direction.

               (c) The Trustee is hereby authorized and directed to
             disburse moneys in the Construction Fund to or upon the order
             of the Company from time to time upon receipt by the Trustee
             of requisitions executed by, or communications by telegram,
             telex or facsimile transmission from, an Authorized Company
             Representative, which requisitions or communications shall
             state with respect to each payment to be made: (i) the
             requisition number, (ii) the name and address of the person,
             firm or corporation to whom payment is due or has been made
             (or, in the case of payments to the Bond Fund, instructions to
             make such payments thereto), (iii) the amount paid or to be
             paid, (iv) the account or accounts within the Construction
             Fund from which payment of such requisition, or any portion
             thereof, shall be made, (v)(A) that each obligation, item of
             cost or expense with respect to which such requisition is
             being made has been properly incurred and has been paid or is
             then due and payable as an item of the Cost of Construction,
             is a proper charge against the Construction Fund, and has not
             been the basis of any previous final payment therefrom or from
             the proceeds of any other obligations issued by the Authority
             or (B) in the event that a portion of the Bonds shall have
             been paid, redeemed or deemed to have been paid within the
             meaning of Article VIII hereof by reason of the application of
             the proceeds of the sale of any obligations issued under an
             indenture other than this Indenture and if the payment of such
             requisition is to be made into the construction, acquisition
             or other similar fund created under such other indenture, that
             upon disbursement from such construction, acquisition or other
             similar fund, each obligation, item of cost or expense
             mentioned in the requisition for such disbursement shall have
             been properly incurred and shall have been paid or will then
             be due and payable as an item of the Cost of Construction,
             (vi) that the payment of such requisition will not result in a
             breach of any of the covenants of the Company contained in
             Section 4.04 (c) or (d) of the Loan Agreement and (vii) that,
             to the best of the knowledge of such Authorized Company
             Representative, there shall not have occurred and be
             continuing any event of default under the Loan Agreement.  In
             Section 4.04 of the Loan Agreement the Company has agreed that
             any such communication by telegram, telex or facsimile
             transmission shall be promptly confirmed by a requisition
             executed by an Authorized Company Representative.

               (d) In paying any requisition under this Section 5.01, the
             Trustee shall be entitled to rely as to the completeness and
             accuracy of all statements in such requisition upon the
             approval of such requisition by an Authorized Company
             Representative, execution thereof to be conclusive evidence of
             such approval, and the Company has by the provisions of the
             Loan Agreement covenanted and agreed to indemnify and save
             harmless the Trustee from any liability incurred in connection
             with the payment of any requisition so executed by an
             Authorized Company Representative.

             The Trustee shall keep and maintain adequate records
          pertaining to each account within the Construction Fund and all
          disbursements therefrom and, upon receipt of a certificate
          furnished pursuant to Section 3.04 or Section 3.08(b) of the Loan
          Agreement, the Trustee shall, if requested by the Authority or
          the Company, file an accounting thereof with the Authority and
          with the Company.

             Section 5.02.  Completion of Facilities; Termination of
          Construction.    Upon receipt by the Trustee of a certificate
          furnished pursuant to Section 3.04 or Section 3.08(b) of the Loan
          Agreement, any balance remaining in the Capital Account or the
          Investment Account maintained within the Construction Fund (other
          than amounts retained by the Trustee at the direction of the
          Company pursuant to Section 3.04 or 3.08 of the Loan Agreement or
          in furtherance of the covenant of the Company contained in clause
          (b) of Section 6.04 of the Loan Agreement) shall (a) be applied
          in whole or in part (i) to the purchase of Bonds in such amounts,
          at such prices, at such times and otherwise as directed by an
          Authorized Company Representative, or (ii) in any other manner
          directed by the Company which, as indicated in an opinion of Bond
          Counsel furnished by the Company to the Authority and the
          Trustee, will not impair the validity under the Act of the Bonds
          or the exclusion of the interest on the Bonds from gross income
          for federal income tax purposes or (b) in the absence of any such
          purchase or direction within sixty (60) days of the receipt by
          the Trustee of such certificate (or such shorter period as the
          Company shall direct), be deposited by the Trustee into the
          corresponding account maintained within the Bond Fund.  From time
          to time as the proper disposition of the amounts retained by the
          Trustee in the Construction Fund as aforesaid shall be
          determined, to the extent that such amounts are not paid out in
          full by the Trustee pursuant to Section 5.01 or 6.01 hereof, the
          Company shall so notify the Trustee and the Authority by one or
          more certificates as aforesaid and any amounts from time to time
          no longer to be so retained by the Trustee shall be applied as
          aforesaid.  Pending the application of any moneys remaining in
          the Construction Fund following the receipt of the aforesaid
          certificate, such moneys may be invested in Investment Securities
          in the manner permitted by Section 6.01 hereof, provided that
          such investments (other than investments made with the moneys
          retained by the Trustee at the direction of the Company pursuant
          to Section 3.04 or 3.08 of the Loan Agreement) shall not produce
          a yield greater than the yield on the Bonds unless, as indicated
          in an opinion of Bond Counsel furnished by the Company to the
          Authority and the Trustee, investments producing a greater yield
          would not, in and of itself, impair the exclusion from gross
          income for federal tax purposes of the interest on the Bonds.

             Section 5.03.  Redemption of All Outstanding Bonds.  Except as
          set forth in Section 5.05 hereof, in the event that all
          Outstanding Bonds are to be redeemed, the Trustee shall, without
          further authorization, deposit into the General Account within
          the Bond Fund all amounts remaining in the Construction Fund
          constituting part of the Trust Estate, with advice to the
          Authority and the Company of such action, such deposit to be made
          on the date fixed for such redemption.

             Section 5.04.  Acceleration of Bonds.  In the event that the
          principal of the Bonds shall have become due and payable pursuant
          to Section 9.01 hereof, the Trustee shall, without further
          authorization, deposit into the General Account within the Bond
          Fund all amounts constituting part of the Trust Estate remaining
          in the Construction Fund, with advice to the Authority and the
          Company of such action, such deposit to be made on the date fixed
          for such acceleration.

             Section 5.05.  Refunding of Bonds.  In the event that all
          Outstanding Bonds are paid, redeemed or deemed to have been paid
          within the meaning of Article VIII hereof by reason of the
          application of the proceeds of the sale of any obligations the
          interest on which is exempt from federal income taxation, under
          an indenture other than this Indenture, the Trustee shall,
          without further authorization, withdraw all amounts constituting
          part of the Trust Estate remaining in the Capital Account and the
          Investment Account maintained within the Construction Fund and
          deposit such amounts into corresponding accounts in the
          construction, acquisition or other similar fund created under the
          indenture under which such obligations are issued, with advice to
          the Authority and the Company of such action, such withdrawals
          and deposits to be made, in accordance with the provisions of
          such indenture, on the date on which such Bonds are so paid,
          redeemed or deemed to have been paid; provided, however, that if
          Bonds shall have been paid, redeemed or deemed to have been paid
          within the meaning of Article VIII hereof by reason of the
          application of the proceeds of the sale of more than one issue of
          obligations the interest on which is excluded from gross income
          for federal income tax purposes under indentures other than this
          Indenture, the Trustee shall, if directed by an Authorized
          Company Representative, withdraw all amounts remaining in the
          Capital Account and the Investment Account maintained within the
          Construction Fund and such amounts shall be allocated among, and
          deposited into, as directed by such Authorized Company
          Representative, corresponding accounts in the construction,
          acquisition or other similar funds created under the indentures
          under which such obligations are issued, with advice to the
          Authority and the Company of such action, such withdrawals and
          deposits to be made, in accordance with the provisions of such
          indentures, on the date on which all Bonds are so paid, redeemed
          or deemed to have been paid.

             Section 5.06.  Moneys Held in Trust.  All moneys and
          Investment Securities held by the Trustee in the Construction
          Fund, shall be held by the Trustee, in trust and such moneys and
          Investment Securities (other than any moneys or Investment
          Securities held in any subaccount within the Construction Fund
          established in furtherance of the obligations of the Company
          under Section 6.04(b) of the Loan Agreement) while so held or so
          required to be deposited or paid, shall constitute part of the
          Trust Estate and be subject to the lien and security interest
          created hereby in favor of the Trustee for the benefit of the
          Owners from time to time of the Bonds.  The Company shall have no
          right, title or interest in the Construction Fund, except that,
          to the extent not required to be applied in another manner by any
          provision hereof, moneys held by the Trustee in the Construction
          Fund shall be disbursed by the Trustee to the Company upon and to
          the extent of, but solely upon and to the extent of, satisfaction
          of the conditions set forth in Section 5.01(c) hereof.


                                      ARTICLE VI

                                     INVESTMENTS

             Section 6.01.  Investments.  The moneys in the Construction
          Fund and in the Bond Fund shall, at the direction of the Company,
          be invested and reinvested in Investment Securities.  Any
          Investment Securities may be purchased subject to options or
          other rights in third parties to acquire the same.  In addition,
          except with respect to moneys or Investment Securities held
          within the General Account of the Bond Fund, the Trustee shall,
          at the direction of the Company, enter into (i) reverse
          repurchase agreements, option agreements and agreements to lend
          securities with respect to any Investment Securities held by it
          and (ii) transactions for the purchase or sale of financial
          futures contracts in obligations which constitute Investment
          Securities or options on financial futures contracts in
          obligations which constitute Investment Securities.  Subject to
          the further provisions of this Section 6.01, such investments
          shall be made by the Trustee as directed and designated by the
          Company in a certificate of, or telephonic advice promptly
          confirmed by a certificate of, an Authorized Company
          Representative.  As and when any amounts thus invested may be
          needed for disbursements from the Construction Fund or the Bond
          Fund, the Trustee shall request the Company to designate such
          investments to be sold or otherwise converted into cash to the
          credit of such fund as shall be sufficient to meet such
          disbursement requirements and shall then follow any directions in
          respect thereto of an Authorized Company Representative.  As long
          as no Event of Default (as defined in Section 9.01 hereof) shall
          have occurred and be continuing, the Company shall have the right
          to designate the investments to be sold and to otherwise direct
          the Trustee in the sale or conversion to cash of the investments
          made with the moneys in the Construction Fund and in the Bond
          Fund, provided that the Trustee shall be entitled to conclusively
          assume the absence of any such Event of Default unless it has
          notice thereof within the meaning of Section 10.05 hereof.


                                     ARTICLE VII

                                  GENERAL COVENANTS

             Section 7.01.  No General Obligations.  Each and every
          covenant herein made, including all covenants made in the various
          sections of this Article VII, is predicated upon the condition
          that neither Pima County, Arizona nor the State of Arizona shall
          in any event be liable for the payment of the principal of, or
          premium, if any, or interest on the Bonds or for the performance
          of any pledge, mortgage, obligation or agreement created by or
          arising out of this Indenture or the issuance of the Bonds, and
          further that neither the Bonds, nor the premium, if any, or
          interest thereon, nor any such obligation or agreement of the
          Authority shall be construed to constitute an indebtedness of
          Pima County, Arizona or the State of Arizona within the meaning
          of any constitutional or statutory provisions whatsoever.  The
          Bonds and the interest and premium, if any, thereon shall be
          limited obligations of the Authority payable solely from the
          Receipts and Revenues of the Authority from the Loan Agreement
          and the other moneys pledged therefor.

             The Authority shall promptly cause to be paid, solely from the
          sources stated herein, the principal of and premium, if any, and
          interest on every Bond issued under this Indenture at the place,
          on the dates and in the manner provided herein and in said Bonds
          according to the true intent and meaning thereof.

             Section 7.02.  Performance of Covenants of the Authority;
          Representations.  The Authority shall faithfully perform at all
          times any and all covenants, undertakings, stipulations and
          provisions contained in this Indenture, in any and every Bond
          executed, authenticated and delivered hereunder, and in all
          proceedings pertaining thereto.  The Authority represents that it
          is duly authorized under the Constitution and laws of the State
          of Arizona to issue the Bonds authorized hereby, to enter into
          the Loan Agreement and this Indenture, and to pledge and assign
          to the Trustee the Trust Estate, and that the Bonds in the hands
          of the Owners thereof are and will be valid and binding limited
          obligations of the Authority.

             Section 7.03.  Maintenance of Rights and Powers; Compliance
          with Laws.  The Authority shall at all times use its best efforts
          to maintain its corporate existence or assure the assumption of
          its obligations under this Indenture by any public body
          succeeding to its powers under the Act; and it shall at all times
          use its best efforts to comply with all valid acts, rules,
          regulations, orders and directions of any legislative, executive,
          administrative or judicial body known to it to be applicable to
          the Loan Agreement and this Indenture.

             Section 7.04.  Enforcement of Obligations of the Company;
          Amendments.  Upon receipt of written notification from the
          Trustee, the Authority shall cooperate with the Trustee in
          enforcing the obligation of the Company to pay or cause to be
          paid all the payments and other costs and charges payable by the
          Company under the Loan Agreement.  The Authority shall not enter
          into any agreement with the Company amending the Loan Agreement
          without the prior written consent of the Trustee and compliance
          with Sections 12.06 and 12.07 of this Indenture (a revision to
          Exhibit A to the Loan Agreement not being deemed an amendment for
          purposes of this Section).

             Section 7.05.  Further Instruments.  The Authority shall, upon
          the reasonable request of the Trustee, from time to time execute
          and deliver such further instruments and take such further action
          as may be reasonable and as may be required to carry out the
          purposes of this Indenture; provided, however, that no such
          instruments or actions shall pledge the credit or taxing power of
          the State of Arizona, Pima County, the Authority or any other
          political subdivision of said State.

             Section 7.06.  No Disposition of Trust Estate.  Except as
          permitted by this Indenture, the Authority shall not sell, lease,
          pledge, assign or otherwise dispose of or encumber its interest
          in the Trust Estate and will promptly pay or cause to be
          discharged or make adequate provision to discharge any lien or
          charge on any part thereof not permitted hereby.

             Section 7.07.  Financing Statements.  The Authority and the
          Trustee shall cooperate with the Company in causing appropriate
          financing statements, naming the Trustee as pledgee of the
          Receipts and Revenues of the Authority from the Loan Agreement
          and of the other moneys pledged under the Indenture for the
          payment of the principal of and premium, if any, and interest on
          the Bonds, and as pledgee and assignee of the balance of the
          Trust Estate, and the Authority shall cooperate with the Trustee
          and the Company in causing appropriate continuation statements to
          be duly filed and recorded in the appropriate state and county
          offices as required by the provisions of the Uniform Commercial
          Code or other similar law as adopted in the State of Arizona and
          any other applicable jurisdiction, as from time to time amended,
          in order to perfect and maintain the security interests created
          by this Indenture.

             Section 7.08.  Tax Covenants; Rebate Fund.  (a)  The Authority
          covenants for the benefit of all Owners from time to time of the
          Bonds that it will not directly or indirectly use or (to the
          extent within its control), permit the use of, the proceeds of
          any of the Bonds or any other funds of the Authority, or take or
          omit to take any other action, if and to the extent that such
          use, or the taking or omission to take such action, would cause
          any of the Bonds to be "arbitrage bonds" within the meaning of
          Section 148 of the Code or otherwise subject to federal income
          taxation by reason of Sections 103 and 141 through 150 of the
          Code and any applicable regulations promulgated thereunder.  To
          that end the Authority covenants to comply with all covenants set
          forth in the Tax Agreement, which is hereby incorporated herein
          by reference as though fully set forth herein.

               (b)  The Trustee shall establish and maintain a fund
             separate from any other fund established and maintained
             hereunder designated "The Industrial Development Authority of
             the County of Pima Industrial Development Revenue Bonds, 1997
             Series A (Tucson Electric Power Company Project) Rebate Fund"
             (herein called the "Rebate Fund") in accordance with the
             provisions of the Tax Agreement.  Within the Rebate Fund, the
             Trustee shall maintain such accounts as shall be directed by
             the Company in order for the Authority and the Company to
             comply with the provisions of the Tax Agreement.  Subject to
             the transfer provisions provided in paragraph (c) below, all
             money at any time deposited in the Rebate Fund shall be held
             by the Trustee in trust, to the extent required to satisfy the
             Rebate Requirement (as defined in the Tax Agreement), for
             payment to the United States of America, and neither the
             Company, the Authority or the Owners shall have any rights in
             or claim to such moneys.  All amounts deposited into or on
             deposit in the Rebate Fund shall be governed by this Section
             7.08, by Section 6.04 of the Loan Agreement and by the Tax
             Agreement.  The Trustee shall conclusively be deemed to have
             complied with such provisions if it follows the directions of
             the Company, including supplying all necessary information in
             the manner set forth in the Tax Agreement, and shall not be
             required to take any actions thereunder in the absence of
             written directions from the Company.

               (c)  Upon receipt of the Company's written instructions, the
             Trustee shall remit part or all of the balances in the Rebate
             Fund to the United States of America, as so directed.  In
             addition, if the Company so directs, the Trustee shall deposit
             moneys into or transfer moneys out of the Rebate Fund from or
             into such accounts or funds as directed by the Company's
             written directions.  Any funds remaining in the Rebate Fund
             after all of the Bonds shall have been paid and any Rebate
             Requirement shall have been satisfied, or provision therefor
             reasonably satisfactory to the Trustee shall have been made,
             shall be withdrawn and remitted to the Company.

               (d)  Notwithstanding any provision of this Indenture, the
             obligation to remit the Rebate Requirement to the United
             States of America and to comply with all other requirements of
             this Section 7.08, Section 6.04 of the Loan Agreement and the
             Tax Agreement shall survive the payment of the Bonds and the
             satisfaction and discharge of this Indenture.

             Section 7.09.  Notices of Trustee.  The Trustee shall give
          notice to both the Authority and the Company whenever it is
          required hereby to give notice to either and, additionally, shall
          furnish to the Authority and the Company copies of any Notice by
          Mail or Publication given by it pursuant to any provision hereof.


                                     ARTICLE VIII

                                      DEFEASANCE

             Section 8.01.  Defeasance.  If the Authority shall pay or
          cause to be paid to the Owner of any Bond secured hereby the
          principal of and premium, if any, and interest due and payable,
          and thereafter to become due and payable, upon such Bond or any
          portion of such Bond in the principal amount of $5,000 or any
          integral multiple thereof, such Bond or portion thereof shall
          cease to be entitled to any lien, benefit or security under this
          Indenture.  If the Authority shall pay or cause to be paid to the
          Owners of all the Bonds secured hereby the principal of and
          premium, if any, and interest due and payable, and thereafter to
          become due and payable, thereon, and shall pay or cause to be
          paid all other sums payable hereunder including, without
          limitation, amounts payable pursuant to Section 10.04 hereof,
          then, and in that case, the right, title and interest of the
          Trustee in and to the Trust Estate shall thereupon cease,
          terminate and become void.  In such event, the Trustee shall
          assign, transfer and turn over to the Company the Trust Estate,
          including, without limitation, any surplus in the Bond Fund and
          any balance remaining in any other fund created under this
          Indenture.

             All or any portion of Outstanding Bonds or portions of Bonds
          in principal amounts of $5,000 or any integral multiple thereof,
          shall prior to the maturity or redemption date thereof be deemed
          to have been paid within the meaning and with the effect
          expressed in this Article VIII, and the entire indebtedness of
          the Authority with respect thereof shall be satisfied and
          discharged, when

               (a) in the event said Bonds or portions thereof have been
             selected for redemption in accordance with Section 3.02
             hereof, the Trustee shall have given, or the Company shall
             have given to the Trustee in form satisfactory to it
             irrevocable instructions to give, on a date in accordance with
             the provisions of Section 3.03 hereof, notice of redemption of
             such Bonds or portions thereof,

               (b) there shall have been deposited with the Trustee either
             moneys in an amount which shall be sufficient, or Government
             Obligations which shall not contain provisions permitting the
             redemption thereof at the option of the issuer, the principal
             of and the interest on which, when due, and without regard to
             any reinvestment thereof, will provide moneys which, together
             with the moneys, if any, deposited with or held by the
             Trustee, shall be sufficient, to pay when due the principal of
             and premium, if any, and interest due and to become due on
             said Bonds or portions thereof on and prior to the redemption
             date or maturity date thereof, as the case may be, and 

               (c) in the event said Bonds or portions thereof do not
             mature and are not to be redeemed within the next succeeding
             sixty (60) days, the Company shall have given the Trustee in
             form satisfactory to it irrevocable instructions to give, as
             soon as practicable in the same manner as a notice of
             redemption is given pursuant to Section 3.03 hereof, a notice
             to the Owners of said Bonds or portions thereof that the
             deposit required by clause (b) above has been made with the
             Trustee and that said Bonds or portions thereof are deemed to
             have been paid in accordance with this Article VIII and
             stating the maturity or redemption date upon which moneys are
             to be available for the payment of the principal of and
             premium, if any, and interest on said Bonds or portions
             thereof.

             Neither the Government Obligations nor moneys deposited with
          the Trustee pursuant to this Article VIII nor principal or
          interest payments on any such Government Obligations shall be
          withdrawn or used for any purpose other than, and such Government
          Obligations, moneys and principal or interest payments shall be
          held in trust for, the payment of the principal of and premium,
          if any, and interest on said Bonds or portions thereof; provided,
          that any cash received from such principal or interest payments
          on such Government Obligations deposited with the Trustee, if not
          then needed for such purposes, shall, to the extent practicable,
          be invested in Government Obligations of the type described in
          clause (b) of the preceding paragraph maturing at times and in
          amounts sufficient to pay when due the principal of and premium,
          if any, and interest to become due on said Bonds or portions
          thereof on and prior to such redemption date or maturity date
          thereof, as the case may be, and interest earned from such
          reinvestments shall be paid over to the Company, as received by
          the Trustee, free and clear of any trust, lien or pledge
          hereunder.  If payment of less than all the Bonds is to be
          provided for in the manner and with the effect provided in this
          Article VIII, the Trustee shall select such Bonds or portions of
          Bonds in the manner specified by Section 3.02 hereof for
          selection for redemption of less than all Bonds in the principal
          amount designated to the Trustee by the Company.  At or prior to
          the time of the deposit of any Government Obligations with the
          Trustee pursuant to this Section 8.01, the Company shall provide
          the Trustee with a certificate of an accountant or an accounting
          firm as to the sufficiency of such Government Obligations to pay
          when due the principal of and premium, if any, and interest due
          and to become due as set forth in clause (b) of the preceding
          paragraph.


                                      ARTICLE IX

                                DEFAULTS AND REMEDIES

             Section 9.01.  Events of Default.  Each of the following
          events shall constitute and is referred to in this Indenture as
          an "Event of Default":

               (a) a failure to pay the principal of or premium, if any, on
             any of the Bonds when the same shall become due and payable at
             maturity, upon redemption or otherwise;

               (b) a failure to pay an installment of interest on any of
             the Bonds after such interest shall have become due and
             payable for a period of thirty (30) days;

               (c) a failure by the Authority to observe and perform any
             covenant, condition, agreement or provision (other than as
             specified in clauses (a) and (b) of this Section 9.01)
             contained in the Bonds or in this Indenture on the part of the
             Authority to be observed or performed, which failure shall
             continue for a period of sixty (60) days after written notice,
             specifying such failure and requesting that it be remedied,
             shall have been given to the Authority and the Company by the
             Trustee, which may give such notice in its discretion and
             which shall give such notice at the written request of Owners
             of not less than 33% in principal amount of the Bonds then
             Outstanding, unless the Trustee, or the Trustee and Owners of
             a principal amount of Bonds not less than the principal amount
             of Bonds the Owners of which requested that such notice be
             given, as the case may be, shall agree in writing to an
             extension of such period prior to its expiration; provided,
             however, that the Trustee, or the Trustee and the Owners of
             such principal amount of Bonds, as the case may be, shall be
             deemed to have agreed to an extension of such period if
             corrective action is initiated by the Authority, or the
             Company on behalf of the Authority, within such period and is
             being diligently pursued.

             Upon the occurrence and continuance of any Event of Default
          described in clause (a) or (b) of the preceding paragraph, the
          Trustee may, and at the written request of Owners of not less
          than 33% in principal amount of Bonds then Outstanding shall, by
          written notice to the Authority and the Company, declare the
          Bonds to be immediately due and payable, whereupon they shall,
          without further action, become and be immediately due and
          payable, anything in this Indenture or in the Bonds to the
          contrary notwithstanding, and the Trustee shall give notice
          thereof by Mail to all Owners of Outstanding Bonds.

             The provisions of the preceding paragraph, however, are
          subject to the condition that if, after the principal of the
          Bonds shall have been so declared to be 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
          Authority shall cause to be deposited with the Trustee a sum
          sufficient to pay all matured installments of interest upon all
          Bonds and the principal of any and all Bonds which shall have
          become due otherwise than by reason of such declaration (with
          interest upon such principal and, to the extent permissible by
          law, on overdue installments of interest, at the rate per annum
          borne by the Bonds) and such amounts as shall be sufficient to
          cover reasonable compensation and reimbursement of expenses
          payable to the Trustee and any predecessor Trustee, and all
          Events of Default hereunder other than nonpayment of the
          principal of Bonds which shall have become due by said
          declaration shall have been remedied, then, in every such case,
          such Event of Default shall be deemed waived and such declaration
          and its consequences rescinded and annulled, and the Trustee
          shall promptly give written notice of such waiver, rescission and
          annulment to the Authority and the Company, and, if notice of the
          acceleration of the Bonds shall have been given to the Owners of
          the Bonds, shall give notice thereof by Mail to all Owners of
          Outstanding Bonds; but no such waiver, rescission and annulment
          shall extend to or affect any subsequent Event of Default or
          impair any right or remedy consequent thereon.

             Section 9.02.  Remedies.  Upon the occurrence and continuance
          of any Event of Default, then and in every such case the Trustee
          in its discretion may, and upon the written request of Owners of
          not less than a majority in principal amount of the Bonds then
          Outstanding and receipt of indemnity to its satisfaction shall,
          in its own name and as the Trustee of an express trust:

               (a) by mandamus, or other suit, action or proceeding at law
             or in equity, enforce all rights of the Owners of the Bonds,
             and require the Authority or the Company to carry out any
             agreements with or for the benefit of such Owners and to
             perform its or their duties under the Act, the Loan Agreement
             and this Indenture;

               (b) bring suit upon the Bonds; or

               (c) by action or suit in equity enjoin any acts or things
             which may be unlawful or in violation of the rights of the
             Owners of the Bonds.

             Section 9.03.  Restoration to Former Position.  In the event
          that any proceeding taken by the Trustee to enforce any right
          under this Indenture shall have been discontinued or abandoned
          for any reason, or shall have been determined adversely to the
          Trustee, then the Authority, the Trustee and the Owners shall be
          restored, subject to any determination in such proceeding, to
          their former positions and rights hereunder, respectively, and
          all rights, remedies and powers of the Trustee shall continue as
          though no such proceeding had been taken.

             Section 9.04.  Owners' Right to Direct Proceedings.  Anything
          in this Indenture to the contrary notwithstanding, the Owners of
          a majority in principal amount of the Bonds then Outstanding
          hereunder shall have the right, by an instrument in writing
          executed and delivered to the Trustee, to direct the time, method
          and place of conducting all remedial proceedings available to the
          Trustee under this Indenture or exercising any trust or power
          conferred on the Trustee by this Indenture; provided, however,
          that such direction shall not be otherwise than in accordance
          with law and the provisions of this Indenture and that the
          Trustee shall have the right (but not the obligation) to decline
          to follow any such direction if the Trustee, being advised by
          counsel, shall determine that the action or proceeding so
          directed may not lawfully be taken, or if the Trustee in good
          faith shall determine that the action or proceedings so directed
          would involve the Trustee in personal liability or if the Trustee
          in good faith shall so determine that the actions or forbearances
          specified in or pursuant to such direction would be unduly
          prejudicial to the interests of Owners not joining in the giving
          of said direction, it being understood that the Trustee shall
          have no duty to ascertain whether or not such actions or
          forbearances are unduly prejudicial to such Owners.

             Section 9.05.  Limitation on Owners' Right to Institute
          Proceedings.  No Owner of Bonds shall have any right to institute
          any suit, action or proceeding in equity or at law for the
          execution of any trust or power hereunder, or any other remedy
          hereunder or on said Bonds, unless such Owner previously shall
          have given to the Trustee written notice of an Event of Default
          as hereinabove provided and unless the Owners of not less than a
          majority in principal amount of the Bonds then Outstanding shall
          have made written request of the Trustee so to do, after the
          right to institute said suit, action or proceeding shall have
          accrued, and shall have afforded the Trustee a reasonable
          opportunity to proceed to institute the same in either its or
          their name, and unless there also shall have been offered to the
          Trustee security and indemnity satisfactory to it against the
          costs, expenses and liabilities to be incurred therein or
          thereby, and the Trustee shall not have complied with such
          request within a reasonable time; and such notification, request
          and offer of indemnity are hereby declared in every such case, at
          the option of the Trustee, to be conditions precedent to the
          institution of said suit, action or proceeding; it being
          understood and intended that no one or more of the Owners of the
          Bonds shall have any right in any manner whatever by his or their
          action to affect, disturb or prejudice the security of this
          Indenture, or to enforce any right hereunder or under the Bonds,
          except in the manner herein provided, and that all suits, actions
          and proceedings at law or in equity shall be instituted, had and
          maintained in the manner herein provided and for the equal
          benefit of all Owners of the Bonds.

             Section 9.06.  No Impairment of Right to Enforce Payment. 
          Notwithstanding any other provision in this Indenture, the right
          of any Owner of a Bond to receive payment of the principal of and
          premium, if any, and interest on such Bond, on or after the
          respective due dates expressed therein, or to institute suit for
          the enforcement of any such payment on or after such respective
          dates, shall not be impaired or affected without the consent of
          such Owner.

             Section 9.07.  Proceedings by Trustee without Possession of
          Bonds.  All rights of action under this Indenture or under any of
          the Bonds secured hereby which are enforceable by the Trustee may
          be enforced by it without the possession of any of the Bonds, or
          the production thereof on the trial or other proceedings relative
          thereto, and any such suit, action or proceeding instituted by
          the Trustee shall be brought in its name for the equal and
          ratable benefit of the Owners of the Bonds, subject to the
          provisions of this Indenture.

             Section 9.08.  No Remedy Exclusive.  No remedy herein
          conferred upon or reserved to the Trustee or to the Owners of the
          Bonds is intended to be exclusive of any other remedy or
          remedies, and each and every such remedy shall be cumulative, and
          shall be in addition to every other remedy given hereunder or
          under the Loan Agreement, now or hereafter existing at law or in
          equity or by statute.

             Section 9.09.  No Waiver of Remedies.  No delay or omission of
          the Trustee or of any Owner of a Bond to exercise any right or
          power accruing upon any default shall impair any such right or
          power or shall be construed to be a waiver of any such default,
          or an acquiescence therein; and every power and remedy given by
          this Article IX to the Trustee and to the Owners of the Bonds,
          respectively, may be exercised from time to time and as often as
          may be deemed expedient.

             Section 9.10.  Application of Moneys.  Any moneys received by
          the Trustee, by any receiver or by any Owner of a Bond pursuant
          to any right given or action taken under the provisions of this
          Article IX, after payment of the costs and expenses of the
          proceedings resulting in the collection of such moneys and of all
          amounts due to the Trustee and any predecessor Trustee under
          Section 10.04 hereof, shall be deposited in the Bond Fund and all
          moneys so deposited in the Bond Fund during the continuance of an
          Event of Default (other than moneys for the payment of Bonds
          which had matured or otherwise become payable prior to such Event
          of Default or for the payment of interest due prior to such Event
          of Default) shall be applied as follows:

               (a) Unless the principal of all the Bonds shall have become
             due and payable, all such moneys shall be applied (i) first,
             to the payment to the persons entitled thereto of all
             installments of interest then due on the Bonds, with interest
             on overdue installments, if lawful, at the rate per annum
             borne by the Bonds, in the order of maturity of the
             installments of such interest and, if the amount available
             shall not be sufficient to pay in full any particular
             installment of interest, then to the payment ratably,
             according to the amounts due on such installment, and (ii)
             second, to the payment to the persons entitled thereto of the
             unpaid principal of any of the Bonds which shall have become
             due (other than Bonds called for redemption for the payment of
             which money is held pursuant to the provisions of this
             Indenture), with interest on such Bonds at their rate from the
             respective dates upon which they became due and, if the amount
             available shall not be sufficient to pay in full Bonds due on
             any particular date, together with such interest, then to the
             payment ratably, according to the amount of principal and
             interest due on such date, in each case to the persons
             entitled thereto, without any discrimination or privilege.

               (b) If the principal of all the Bonds shall have become due
             and payable, all such moneys shall be applied to the payment
             of the principal and interest then due and unpaid upon the
             Bonds, with interest on overdue interest and principal, as
             aforesaid, without preference or priority of principal over
             interest or of interest over principal, or of any installment
             of interest over any other installment of interest, or of any
             Bond over any other Bond, ratably, according to the amounts
             due respectively for principal and interest, to the persons
             entitled thereto without any discrimination or privilege.

               (c) If the principal of all the Bonds shall have become due
             and payable, and if acceleration of the maturity of the Bonds
             by reason of such Event of Default shall thereafter have been
             rescinded and annulled under the provisions of this Article
             IX, then, subject to the provisions of clause (b) of this
             Section 9.10 which shall be applicable in the event that the
             principal of all the Bonds shall later become due and payable,
             the moneys shall be applied in accordance with the provisions
             of clause (a) of this Section 9.10.

             Section 9.11.  Severability of Remedies.  It is the purpose
          and intention of this Article IX to provide rights and remedies
          to the Trustee and the Owners which may be lawfully granted under
          the provisions of the Act, but should any right or remedy herein
          granted be held to be unlawful, the Trustee and the Owners shall
          be entitled, as above set forth, to every other right and remedy
          provided in this Indenture and by law.


                                      ARTICLE X

                TRUSTEE; PAYING AGENT AND CO-PAYING AGENTS; REGISTRAR

             Section 10.01. Acceptance of Trusts.  The Trustee hereby
          accepts and agrees to execute the trusts hereby created, but only
          upon the additional terms set forth in this Article X, to all of
          which the Authority agrees and the respective Owners agree by
          their acceptance of delivery of any of the Bonds.

             Section 10.02. No Responsibility for Recitals.  The recitals,
          statements and representations contained in this Indenture or in
          the Bonds, save only the Trustee's authentication upon the Bonds,
          are not made by the Trustee, and the Trustee does not assume, and
          shall not have, any responsibility or obligation for the
          correctness of any thereof.  The Trustee makes no representation
          as to the validity or sufficiency of this Indenture or the Bonds.

             Section 10.03. Limitations on Liability.  The Trustee may
          execute any of the trusts or powers hereof and perform the duties
          required of it hereunder by or through attorneys, agents,
          receivers, or employees, and shall be entitled to advice of
          counsel concerning all matters of trust and its duty hereunder,
          and the Trustee shall not be answerable for the default or
          misconduct of any such attorney, agent, receiver, or employee
          selected by it with reasonable care.  The Trustee shall not be
          answerable for the exercise of any discretion or power under this
          Indenture or for anything whatsoever in connection with the trust
          created hereby, except only for its own negligence or bad faith.

             Anything in this Indenture to the contrary notwithstanding,
          the Trustee shall in no event be required to expend or risk its
          own funds or otherwise incur personal financial liability in the
          performance of any of its duties or in the exercise of any of its
          rights or powers, if there shall be reasonable grounds for
          believing that the repayment of such funds or adequate indemnity
          against such liability is not reasonably assured to it.

             Section 10.04. Compensation, Expenses and Advances.  The
          Trustee, the Paying Agent and any Co-Paying Agent and the
          Registrar under this Indenture shall be entitled to reasonable
          compensation for their services rendered hereunder (not limited
          by any provision of law regarding the compensation of the trustee
          of an express trust) and to reimbursement for their actual
          out-of-pocket expenses (including counsel fees) reasonably
          incurred in connection therewith except as a result of their
          negligence or bad faith, including, without limitation,
          compensation for any services rendered, and reimbursement for any
          expenses incurred, at and subsequent to the time the Bonds are
          deemed to have been paid in accordance with Article VIII hereof. 
          If the Authority shall fail to perform any of the covenants or
          agreements contained in this Indenture, other than the covenants
          or agreements in respect of the payment of the principal of and
          premium, if any, and interest on the Bonds, the Trustee may, in
          its uncontrolled discretion and without notice to the Owners of
          the Bonds, at any time and from time to time, make advances to
          effect performance of the same on behalf of the Authority, but
          the Trustee shall be under no obligation so to do; and any and
          all such advances may bear interest at a rate per annum not
          exceeding the base rate then in effect for 90-day commercial
          loans by the Trustee or a commercial banking affiliate of the
          Trustee designated as such by the Trustee in the city in which is
          located the Principal Office of the Trustee (or such affiliate,
          as the case may be) to borrowers of the highest credit standing;
          but no such advance shall operate to relieve the Authority from
          any default hereunder.  In Section 5.03 of the Loan Agreement,
          the Company has agreed that it will pay to the Trustee (including
          any predecessor Trustee), the Paying Agent and any Co-Paying
          Agent and the Registrar such compensation and reimbursement of
          expenses and advances, but the Company may, without creating a
          default hereunder, contest in good faith the reasonableness of
          any such services, expenses and advances.  If the Company shall
          have failed to make any payment to the Trustee or any predecessor
          Trustee under Section 5.03 of the Loan Agreement and such failure
          shall have resulted in an Event of Default under the Loan
          Agreement, the Trustee, and any predecessor Trustee, shall have,
          in addition to any other rights hereunder, a claim, prior to the
          claim of the Owners, for the payment of its compensation and the
          reimbursement of its expenses and any advances made by it, as
          provided in this Section 10.04, upon the moneys and obligations
          in the Bond Fund; provided, however, that neither the Trustee nor
          any predecessor Trustee shall have any such claim upon moneys or
          obligations deposited with or paid to the Trustee for the
          redemption or payment of Bonds which are deemed to have been paid
          in accordance with Article VIII hereof.

             In Section 5.04 of the Loan Agreement, the Company has agreed
          to indemnify the Trustee and any predecessor Trustee to the
          extent provided therein.

             Section 10.05. Notice of Events of Default.  The Trustee shall
          not be required to take notice, or be deemed to have notice, of
          any default or Event of Default under this Indenture other than
          an Event of Default under clause (a) or (b) of the first
          paragraph of Section 9.01 hereof, unless an officer assigned by
          the Trustee to administer its corporate trust business has been
          specifically notified in writing of such default or Event of
          Default by Owners of at least 33% in principal amount of the
          Bonds then Outstanding.  The Trustee may, however, at any time,
          in its discretion, require of the Authority and the Company full
          information and advice as to the performance of any of the
          covenants, conditions and agreements contained herein.

             Section 10.06. Action by Trustee.  The Trustee shall be under
          no obligation to take any action in respect of any default or
          Event of Default hereunder or toward the execution or enforcement
          of any of the trusts hereby created, or to institute, appear in
          or defend any suit or other proceeding in connection therewith,
          unless requested in writing so to do by Owners of at least a
          majority in principal amount of the Bonds then Outstanding, and,
          if in its opinion such action may tend to involve it in expense
          or liability, unless furnished, from time to time as often as it
          may require, with security and indemnity satisfactory to it.  The
          foregoing provisions are intended only for the protection of the
          Trustee, and shall not affect any discretion or power given by
          any provisions of this Indenture to the Trustee to take action in
          respect of any default or Event of Default without such notice or
          request from the Owners of the Bonds, or without such security or
          indemnity.

             Section 10.07. Good Faith Reliance.  The Trustee shall be
          protected and shall incur no liability in acting or proceeding in
          good faith upon any resolution, notice, telegram, telex,
          facsimile transmission, request, consent, waiver, certificate,
          statement, affidavit, voucher, bond, requisition or other paper
          or document which it shall in good faith believe to be genuine
          and to have been passed or signed by the proper board, body or
          person or to have been prepared and furnished pursuant to any of
          the provisions of this Indenture or the Loan Agreement, or upon
          the written opinion of any attorney, engineer, accountant or
          other expert believed by the Trustee to be qualified in relation
          to the subject matter, and the Trustee shall be under no duty to
          make any investigation or inquiry as to any statements contained
          or matters referred to in any such instrument, but may accept and
          rely upon the same as conclusive evidence of the truth and
          accuracy of such statements.  Neither the Trustee, the Paying
          Agent, any Co-Paying Agent nor the Registrar shall be bound to
          recognize any person as an Owner of a Bond or to take any action
          at his request unless the ownership of such Bond is proved as
          contemplated in Section 11.01 hereof.

             Section 10.08. Dealings in Bonds and with the Authority and
          the Company.  The Trustee, the Paying Agent, any Co-Paying Agent
          or the Registrar, in its individual or any other capacity, may in
          good faith buy, sell, own, hold and deal in any of the Bonds
          issued hereunder, and may join in any action which any Owner of a
          Bond may be entitled to take with like effect as if it did not
          act in any capacity hereunder.  The Trustee, the Paying Agent,
          any Co-Paying Agent or the Registrar, in its individual or any
          other capacity, either as principal or agent, may also engage in
          or be interested in any financial or other transaction with the
          Authority or the Company, and may act as depositary, trustee, or
          agent for any committee or body of Owners of Bonds secured hereby
          or other obligations of the Authority as freely as if it did not
          act in any capacity hereunder.

             Section 10.09. Allowance of Interest.  The Trustee may, but
          shall not be obligated to, allow and credit interest upon any
          moneys which it may at any time receive under any of the
          provisions of this Indenture, at such rate, if any, as it
          customarily allows upon similar funds of similar size and under
          similar conditions.  All interest allowed on any such moneys
          shall be credited as provided in Articles IV and V with respect
          to interest on investments.

             Section 10.10. Construction of Indenture.  The Trustee may
          construe any of the provisions of this Indenture insofar as the
          same may appear to be ambiguous or inconsistent with any other
          provision hereof, and any construction of any such provisions
          hereof by the Trustee in good faith shall be binding upon the
          Owners of the Bonds.

             Section 10.11. Resignation of Trustee.  The Trustee may resign
          and be discharged of the trusts created by this Indenture by
          executing an instrument in writing resigning such trust and
          specifying the date when such resignation shall take effect, and
          filing the same with the President of the Authority and with the
          Company, not less than forty-five (45) days before the date
          specified in such instrument when such resignation shall take
          effect, and by giving notice of such resignation by Mail to all
          Owners of Bonds.  Such resignation shall take effect on the later
          to occur of (i) the day specified in such instrument and notice,
          unless previously a successor Trustee shall have been appointed
          as hereinafter provided, in which event such resignation shall
          take effect immediately upon the appointment of such successor
          Trustee and (ii) the appointment of a successor Trustee.

             So long as no event which is, or after notice or lapse of
          time, or both, would become, an Event of Default shall have
          occurred and be continuing, if the Authority shall have delivered
          to the Trustee (i) an instrument appointing a successor Trustee,
          effective as of a date specified therein and (ii) an instrument
          of acceptance of such appointment, effective as of such date, by
          such successor Trustee in accordance with Section 10.16, the
          Trustee shall be deemed to have resigned as contemplated in this
          Section, the successor Trustee shall be deemed to have been
          appointed pursuant to subsection (b) of Section 10.13 and such
          appointment shall be deemed to have been accepted as contemplated
          in Section 10.16, all as of such date, and all other provisions
          of this Article X shall be applicable to such resignation,
          appointment and acceptance except to the extent inconsistent with
          this paragraph.  The Authority shall deliver any such instrument
          of appointment at the direction of the Company.

             Section 10.12. Removal of Trustee.  The Trustee may be removed
          at any time by filing with the Trustee so removed, and with the
          Authority and the Company, an instrument or instruments in
          writing, appointing a successor, or an instrument or instruments
          in writing, consenting to the appointment by the Authority (at
          the direction of the Company) of a successor and accompanied by
          an instrument of appointment by the Authority (at the direction
          of the Company) of such successor, and in any event executed by
          Owners of not less than a majority in principal amount of the
          Bonds then Outstanding, such filing to be made by any Owner of a
          Bond or his duly authorized attorney.

             Section 10.13. Appointment of Successor Trustee.  (a) In case
          at any time the Trustee shall be removed, or be dissolved, or if
          its property or affairs shall be taken under the control of any
          state or federal court or administrative body because of
          insolvency or bankruptcy, or for any other reason, then a vacancy
          shall forthwith and ipso facto exist and a successor may be
          appointed, and in case at any time the Trustee shall resign or be
          deemed to have resigned, then a successor may be appointed, by
          filing with the Authority and the Company an instrument in
          writing appointing such successor Trustee executed by Owners of
          not less than a majority in principal amount of Bonds then
          Outstanding.  Copies of such instrument shall be promptly
          delivered by the Authority to the predecessor Trustee, to the
          Trustee so appointed and the Company.

               (b)  Until a successor Trustee shall be appointed by the
             Owners of the Bonds as herein authorized, the Authority, shall
             appoint a successor Trustee as directed by the Company.  After
             any appointment by the Authority, it shall cause notice of
             such appointment to be given by Mail to all Owners of Bonds. 
             Any new Trustee so appointed by the Authority shall
             immediately and without further act be superseded by a Trustee
             appointed by the Owners of the Bonds in the manner above
             provided.

               (c)  No resignation or removal of the Trustee and no
             appointment of a successor Trustee pursuant to this Article
             shall become effective until the acceptance of appointment by
             the successor Trustee.

             Section 10.14. Qualifications of Successor Trustee.  Every
          successor Trustee (a) shall be a bank or trust company duly
          organized under the laws of the United States or any state or
          territory thereof authorized by law to perform all the duties
          imposed upon it by this Indenture and (b) shall have (or the
          parent holding company of which shall have) a combined capital
          stock, surplus and undivided profits of at least $100,000,000 if
          there can be located, with reasonable effort, such an institution
          willing and able to accept the trust on reasonable and customary
          terms.

             Section 10.15. Judicial Appointment of Successor Trustee.  In
          case at any time the Trustee shall resign and no appointment of a
          successor Trustee shall be made pursuant to the foregoing
          provisions of this Article X prior to the date specified in the
          notice of resignation as the date when such resignation is to
          take effect, the retiring Trustee may forthwith apply to a court
          of competent jurisdiction for the appointment of a successor
          Trustee.  If no appointment of a successor Trustee shall be made
          pursuant to the foregoing provisions of this Article X within six
          months after a vacancy shall have occurred in the office of
          Trustee, any Owner of a Bond may apply to any court of competent
          jurisdiction to appoint a successor Trustee.  Such court may
          thereupon, after such notice, if any, as it may deem proper and
          prescribe, appoint a successor Trustee.

             Section 10.16. Acceptance of Trusts by Successor Trustee.  Any
          successor Trustee appointed hereunder shall execute, acknowledge
          and deliver to the Authority an instrument accepting such
          appointment hereunder, and thereupon such successor Trustee,
          without any further act, deed or conveyance, shall become duly
          vested with all the estates, property, rights, powers, trusts,
          duties and obligations of its predecessor in the trust hereunder,
          with like effect as if originally named Trustee herein.  Upon
          request of such Trustee, such predecessor Trustee and the
          Authority shall execute and deliver an instrument transferring to
          such successor Trustee all the estates, property, rights, powers
          and trusts hereunder of such predecessor Trustee and, subject to
          the provisions of Section 10.04 hereof, such predecessor Trustee
          shall pay over to the successor Trustee all moneys and other
          assets at the time held by it hereunder.

             Section 10.17. Successor by Merger or Consolidation.  Any
          corporation or association into which any Trustee hereunder may
          be merged or converted or with which it may be consolidated, or
          any corporation or association resulting from any merger or
          consolidation to which any Trustee hereunder shall be a party or
          any corporation or association succeeding to the corporate trust
          business of the Trustee, shall be the successor Trustee under
          this Indenture, without the execution or filing of any paper or
          any further act on the part of the parties hereto, anything in
          this Indenture to the contrary notwithstanding.

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

             Section 10.18. Standard of Care.  Notwithstanding any other
          provisions of this Article X, the Trustee shall, during the
          existence of an Event of Default of which the Trustee has actual
          notice, exercise such of the rights and powers vested in it by
          this Indenture and use the same degree of skill and care in their
          exercise as a prudent man would use and exercise under the
          circumstances in the conduct of his own affairs.

             Section 10.19. Notice to Owners of Bonds of Event of Default. 
          If an Event of Default occurs of which the Trustee by Section
          10.05 hereof is required to take notice and deemed to have
          notice, or any other Event of Default occurs of which the Trustee
          has been specifically notified in accordance with Section 10.05
          hereof, and any such Event of Default shall continue for at least
          two days after the Trustee acquires actual notice thereof, unless
          the Trustee shall have theretofore given a notice of acceleration
          pursuant to Section 9.01 hereof, the Trustee shall give Notice by
          Mail to all Owners of Outstanding Bonds.

             Section 10.20. Intervention in Litigation of the Authority. 
          In any judicial proceeding to which the Authority is a party and
          which in the opinion of the Trustee and its counsel has a
          substantial bearing on the interests of the Owners of Bonds, the
          Trustee may intervene on behalf of the Owners of the Bonds and
          shall, upon receipt of indemnity satisfactory to it, do so if
          requested in writing by Owners of at least a majority in
          principal amount of the Bonds then Outstanding if permitted by
          the court having jurisdiction in the premises.

             Section 10.21. Paying Agent; Co-Paying Agents.  The Authority
          shall, with the approval of the Company, appoint the Paying Agent
          for the Bonds and may at any time or from time to time, with the
          approval of the Company, appoint one or more Co-Paying Agents for
          the Bonds, subject to the conditions set forth in Section 10.22
          hereof.  The Paying Agent and each Co-Paying Agent shall
          designate to the Trustee its Principal Office and signify its
          acceptance of the duties and obligations imposed upon it
          hereunder by a written instrument of acceptance delivered to the
          Authority and the Trustee in which such Paying Agent or Co-Paying
          Agent will agree, particularly:

               (a) to hold all sums held by it for the payment of the
             principal of and premium, if any, or interest on Bonds in
             trust for the benefit of the Owners of the Bonds until such
             sums shall be paid to such Owners or otherwise disposed of as
             herein provided;

               (b) to keep such books and records as shall be consistent
             with prudent industry practice, to make such books and records
             available for inspection by the Authority, the Trustee and the
             Company at all reasonable times and, in the case of a
             Co-Paying Agent, to promptly furnish copies of such books and
             records to the Paying Agent; and

               (c) in the case of a Co-Paying Agent, upon the request of
             the Paying Agent, to forthwith deliver to the Paying Agent all
             sums so held in trust by such Co-Paying Agent.

             The Authority shall cooperate with the Trustee and the Company
          to cause the necessary arrangements to be made and to be
          thereafter continued whereby funds derived from the sources
          specified in Sections 4.03 and 4.04 hereof will be made available
          to the Paying Agent and each Co-Paying Agent for the payment when
          due of the principal of, premium, if any, and interest on the
          Bonds.

             Section 10.22. Qualifications of Paying Agent and Co-Paying
          Agents; Resignation; Removal.  The Paying Agent and any Co-Paying
          Agent shall be a corporation or association duly organized under
          the laws of the United States of America or any state or
          territory thereof, having a combined capital stock, surplus and
          undivided profits of at least $15,000,000 and authorized by law
          to perform all the duties imposed upon it by this Indenture.  The
          Paying Agent and any Co-Paying Agent may at any time resign and
          be discharged of the duties and obligations created by this
          Indenture by giving at least sixty (60) days' notice to the
          Authority, the Company and the Trustee.  The Paying Agent and any
          Co-Paying Agent may be removed at any time, at the direction of
          the Company, by an instrument, signed by the Authority, filed
          with the Paying Agent or such Co-Paying Agent, as the case may
          be, and with the Trustee.

             In the event of the resignation or removal of the Paying Agent
          or any Co-Paying Agent, the Paying Agent or such Co-Paying Agent,
          as the case may be, shall pay over, assign and deliver any moneys
          held by it in such capacity to its successor or, if there be no
          successor, to the Trustee.

             In the event that the Authority shall fail to appoint a Paying
          Agent hereunder, or in the event that the Paying Agent shall
          resign or be removed, or be dissolved, or if the property or
          affairs of the Paying Agent shall be taken under the control of
          any state or federal court or administrative body because of
          bankruptcy or insolvency, or for any other reason, and the
          Authority shall not have appointed its successor as Paying Agent,
          the Trustee shall ipso facto be deemed to be the Paying Agent for
          all purposes of this Indenture until the appointment by the
          Authority of the Paying Agent or successor Paying Agent, as the
          case may be.

             Upon the appointment of a successor Paying Agent, the Trustee
          shall give notice thereof by Mail to all Owners of Bonds.

             Section 10.23. Registrar.  The Authority shall, with the
          approval of the Company, appoint the Registrar for the Bonds,
          subject to the conditions set forth in Section 10.24 hereof.  The
          Registrar shall designate to the Trustee its Principal Office and
          signify its acceptance of the duties imposed upon it hereunder by
          a written instrument of acceptance delivered to the Authority and
          the Trustee in which such Registrar will agree, particularly, to
          keep such books and records as shall be consistent with prudent
          industry practice and to make such books and records available
          for inspection by the Authority, the Trustee and the Company at
          all reasonable times.

             The Authority shall cooperate with the Trustee and the Company
          to cause the necessary arrangements to be made and to be
          thereafter continued whereby Bonds, executed by the Authority and
          authenticated by the Trustee, shall be made available for
          exchange, registration and registration of transfer at the
          Principal Office of the Registrar.  The Authority shall cooperate
          with the Trustee, the Registrar and the Company to cause the
          necessary arrangements to be made and thereafter continued
          whereby the Paying Agent and any Co-Paying Agent shall be
          furnished such records and other information, at such times, as
          shall be required to enable the Paying Agent and such Co-Paying
          Agent to perform the duties and obligations imposed upon them
          hereunder.

             Section 10.24. Qualifications of Registrar; Resignation;
          Removal.  The Registrar shall be a corporation or association
          duly organized under the laws of the United States of America or
          any state or territory thereof, having a combined capital stock,
          surplus and undivided profits of at least $15,000,000 and
          authorized by law to perform all the duties imposed upon it by
          this Indenture.  The Registrar may at any time resign and be
          discharged of the duties and obligations created by this
          Indenture by giving at least sixty (60) days' notice to the
          Authority, the Trustee and the Company.  The Registrar may be
          removed at any time, at the direction of the Company, by an
          instrument signed by the Authority filed with the Registrar and
          the Trustee.

             In the event of the resignation or removal of the Registrar,
          the Registrar shall deliver any Bonds held by it in such capacity
          to its successor or, if there be no successor, to the Trustee.

             In the event that the Authority shall fail to appoint a
          Registrar hereunder, or in the event that the Registrar shall
          resign or be removed, or be dissolved, or if the property or
          affairs of the Registrar shall be taken under the control of any
          state or federal court or administrative body because of
          bankruptcy or insolvency, or for any other reason, and the
          Authority shall not have appointed its successor as Registrar,
          the Trustee shall ipso facto be deemed to be the Registrar for
          all purposes of this Indenture until the appointment by the
          Authority of the Registrar or successor Registrar, as the case
          may be.

             Upon the appointment of a successor Registrar, the Trustee
          shall give notice thereof by Mail to all Owners of Bonds.

             Section 10.25. Several Capacities.  Anything herein to the
          contrary notwithstanding, the same entity may serve hereunder as
          the Trustee, the Paying Agent or a Co-Paying Agent and the
          Registrar, and in any combination of such capacities to the
          extent permitted by law.


                                      ARTICLE XI

                   EXECUTION OF INSTRUMENTS BY OWNERS OF BONDS AND
                             PROOF OF OWNERSHIP OF BONDS

             Section 11.01. Execution of Instruments; Proof of Ownership. 
          Any request, direction, consent or other instrument in writing,
          whether or not required or permitted by this Indenture to be
          signed or executed by Owners of the Bonds, may be in any number
          of concurrent instruments of similar tenor and may be signed or
          executed by Owners of the Bonds or by an agent appointed by an
          instrument in writing.  Proof of the execution of any such
          instrument and of the ownership of Bonds shall be sufficient for
          any purpose of this Indenture and shall be conclusive in favor of
          the Trustee with regard to any action taken by it under such
          instrument if made in the following manner:

               (a) The fact and date of the execution by any person of any
             such instrument may be proved by the certificate of any
             officer in any jurisdiction who, by the laws thereof, has
             power to take acknowledgments within such jurisdiction, to the
             effect that the person signing such instrument acknowledged
             before him the execution thereof, or by an affidavit of a
             witness to such execution.

               (b) The ownership or former ownership of Bonds shall be
             proved by the registration books kept under the provisions of
             Section 2.08 hereof.

             Nothing contained in this Article XI shall be construed as
          limiting the Trustee to such proof, it being intended that the
          Trustee may accept any other evidence of matters herein stated
          which it may deem sufficient.  Any request or consent of any
          Owner of a Bond shall bind every future Owner of the same Bond or
          any Bond or Bonds issued in lieu thereof in respect of anything
          done by the Trustee or the Authority in pursuance of such request
          or consent.


                                     ARTICLE XII

                MODIFICATION OF THIS INDENTURE AND THE LOAN AGREEMENT

             Section 12.01. Limitations.  Neither this Indenture nor the
          Loan Agreement shall be modified or amended in any respect
          subsequent to the original issuance of the Bonds except as
          provided in and in accordance with and subject to the provisions
          of this Article XII and Section 7.04 hereof.

             The Trustee may, but shall not be obligated to, enter into any
          Supplemental Indenture which affects the Trustee's own rights,
          duties or immunities under this Indenture or otherwise.

             Section 12.02. Supplemental Indentures without Owner Consent. 
          The Authority and the Trustee may, from time to time and at any
          time, without the consent of or notice to the Owners of the
          Bonds, enter into Supplemental Indentures as follows:

               (a) to cure any formal defect, omission, inconsistency or
             ambiguity in this Indenture, provided, however, that such cure
             shall not materially and adversely affect the interests of the
             Owners of the Bonds;

               (b) to grant to or confer or impose upon the Trustee for the
             benefit of the Owners of the Bonds any additional rights,
             remedies, powers, authority, security, liabilities or duties
             which may lawfully be granted, conferred or imposed;

               (c) to add to the covenants and agreements of, and
             limitations and restrictions upon, the Authority in this
             Indenture other covenants, agreements, limitations and
             restrictions to be observed by the Authority;

               (d) to confirm, as further assurance, any pledge under, and
             the subjection to any claim, lien or pledge created or to be
             created by, this Indenture, of the Receipts and Revenues of
             the Authority from the Loan Agreement or of any other moneys,
             securities or funds;

               (e) to authorize a different denomination or denominations
             of the Bonds and to make correlative amendments and
             modifications to this Indenture regarding exchange ability of
             Bonds of different denominations, redemptions of portions of
             Bonds of particular denominations and similar amendments and
             modifications of a technical nature;

               (f) to modify, alter, supplement or amend this Indenture in
             such manner as shall permit the qualification hereof under the
             Trust Indenture Act of 1939, as from time to time amended;

               (g) to modify, alter, supplement or amend this Indenture in
             such manner as shall be necessary, desirable or appropriate in
             order to provide for or eliminate the registration and
             registration of transfer of the Bonds through a book-entry or
             similar method, whether or not the Bonds are evidenced by
             certificates;

               (h) to modify, alter, amend or supplement this Indenture in
             any other respect which is not materially adverse to the
             Owners and which does not involve a change described in clause
             (i), (ii), (iii) or (iv) of Section 12.03(a) hereof; and

               (i) to provide any additional procedures, covenants or
             agreements necessary or desirable to maintain the tax-exempt
             status of interest on the Bonds.

             Before the Authority and the Trustee shall enter into any
          Supplemental Indenture pursuant to this Section 12.02, there
          shall have been delivered to the Trustee an opinion of Bond
          Counsel stating that such Supplemental Indenture is authorized or
          permitted by this Indenture and the Act, complies with their
          respective terms, will, upon the execution and delivery thereof,
          be valid and binding upon the Authority in accordance with its
          terms and will not, in and of itself, adversely affect the
          exclusion from gross income for federal tax purposes of the
          interest on the Bonds.

             Section 12.03. Supplemental Indentures with Consent of Owners. 
          (a) Except for any Supplemental Indenture entered into pursuant
          to Section 12.02 hereof, subject to the terms and provisions
          contained in this Section 12.03 and Section 12.05 and not
          otherwise, Owners of not less than a majority in aggregate
          principal amount of the Bonds then Outstanding which would be
          adversely affected thereby shall have the right from time to time
          to consent to and approve the execution and delivery by the
          Authority and the Trustee of any Supplemental Indenture deemed
          necessary or desirable by the Authority for the purposes of
          modifying, altering, amending, supplementing or rescinding, in
          any particular, any of the terms or provisions contained in this
          Indenture; provided, however, that, unless approved in writing by
          the Owners of all the Bonds then Outstanding which would be
          adversely affected thereby, nothing herein contained shall
          permit, or be construed as permitting, (i) a change in the times,
          amounts or currency of payment of the principal of or premium, if
          any, or interest on any Outstanding Bond, a reduction in the
          principal amount or redemption price of any Outstanding Bond or a
          change in the rate of interest thereon, or any impairment of the
          right of any Owner to institute suit for the payment of any Bond
          owned by it, or (ii) the creation of a claim or lien upon, or a
          pledge of, the Receipts and Revenues of the Authority from the
          Loan Agreement ranking prior to or on a parity with the claim,
          lien or pledge created by this Indenture (except as referred to
          in Section 10.04 hereof), or (iii) a preference or priority of
          any Bond or Bonds over any other Bond or Bonds, or (iv) a
          reduction in the aggregate principal amount of Bonds the consent
          of the Owners of which is required for any such Supplemental
          Indenture or which is required, under Section 12.07 hereof, for
          any modification, alteration, amendment or supplement to the Loan
          Agreement.

               (b) If at any time the Authority shall request the Trustee
             to enter into any Supplemental Indenture for any of the
             purposes of this Section 12.03, the Trustee shall cause notice
             of the proposed Supplemental Indenture to be given by Mail to
             all Owners of Outstanding Bonds.  Such notice shall briefly
             set forth the nature of the proposed Supplemental Indenture
             and shall state that a copy thereof is on file at the
             Principal Office of the Trustee for inspection by all Owners
             of Bonds.

               (c) Within two years after the date of the first mailing of
             such notice, the Authority and the Trustee may enter into such
             Supplemental Indenture in substantially the form described in
             such notice only if there shall have first been delivered to
             the Trustee (i) the required consents, in writing, of Owners
             of Bonds and (ii) an opinion of Bond Counsel stating that such
             Supplemental Indenture is authorized or permitted by this
             Indenture and the Act, complies with their respective terms
             and, upon the execution and delivery thereof, will be valid
             and binding upon the Authority in accordance with its terms
             and will not, in and of itself, adversely affect the exclusion
             from gross income for federal tax purposes of the interest on
             the Bonds.

               (d) If Owners of not less than the percentage of Bonds
             required by this Section 12.03 shall have consented to and
             approved the execution and delivery thereof as herein
             provided, no Owner shall have any right to object to the
             execution and delivery of such Supplemental Indenture, or to
             object to any of the terms and provisions contained therein or
             the operation thereof, or in any manner to question the
             propriety of the execution and delivery thereof, or to enjoin
             or restrain the Authority or the Trustee from executing and
             delivering the same or from taking any action pursuant to the
             provisions thereof.

             Section 12.04. Effect of Supplemental Indenture.  Upon the
          execution and delivery of any Supplemental Indenture pursuant to
          the provisions of this Article XII, this Indenture shall be, and
          be deemed to be, modified, altered, amended or supplemented in
          accordance therewith, and the respective rights, duties and
          obligations under this Indenture of the Authority, the Trustee
          and Owners of all Bonds then Outstanding shall thereafter be
          determined, exercised and enforced under this Indenture subject
          in all respects to such modifications, alterations, amendments
          and supplements.

             Section 12.05. Consent of the Company.  Anything herein to the
          contrary notwithstanding, any Supplemental Indenture under this
          Article XII which affects any rights, powers, agreements or
          obligations of the Company under the Loan Agreement or requires a
          revision of the Loan Agreement shall not become effective unless
          and until the Company shall have consented to such Supplemental
          Indenture.

             Section 12.06. Amendment of Loan Agreement without Consent of
          Owners.  Without the consent of or notice to the Owners of the
          Bonds, the Authority may enter into any Supplemental Loan
          Agreement, and the Trustee may consent thereto, as may be
          required (a) by the provisions of the Loan Agreement and this
          Indenture, (b) for the purpose of curing any formal defect,
          omission, inconsistency or ambiguity therein, (c) to provide any
          additional procedures, covenants or agreements necessary or
          desirable to maintain the tax-exempt status of interest on the
          Bonds, or (d) in connection with any other change therein which
          is not materially adverse to the Owners of the Bonds.  A revision
          of Exhibit A to the Loan Agreement pursuant to Section 3.03
          thereof, shall not be deemed a Supplemental Loan Agreement for
          purposes of this Indenture.

             Before the Authority shall enter into, and the Trustee shall
          consent to, any Supplemental Loan Agreement pursuant to this
          Section 12.06, there shall have been delivered to the Trustee an
          opinion of Bond Counsel stating that such Supplemental Loan
          Agreement is authorized or permitted by this Indenture and the
          Act, complies with their respective terms, will, upon the
          execution and delivery thereof, be valid and binding upon the
          Authority and the Company in accordance with its terms and will
          not, in and of itself, adversely affect the exclusion from gross
          income for federal tax purposes of interest on the Bonds.

             Section 12.07. Amendment of Loan Agreement with Consent of
          Owners.  Except in the case of Supplemental Loan Agreements
          referred to in Section 12.06 hereof, the Authority shall not
          enter into, and the Trustee shall not consent to, any
          Supplemental Loan Agreement without the written approval or
          consent of the Owners of not less than a majority in aggregate
          principal amount of the Bonds then Outstanding which would be
          adversely affected thereby, given and procured as provided in
          Section 12.03 hereof; provided, however, that, unless approved in
          writing by the Owners of all Bonds then Outstanding which would
          be adversely affected thereby, nothing herein contained shall
          permit, or be construed as permitting, a change in the
          obligations of the Company under Section 5.01 of the Loan
          Agreement.  If at any time the Authority or the Company shall
          request the consent of the Trustee to any such proposed
          Supplemental Loan Agreement, the Trustee shall cause notice of
          such proposed Supplemental Loan Agreement to be given in the same
          manner as provided by Section 12.03 hereof with respect to
          Supplemental Indentures.  Such notice shall briefly set forth the
          nature of such proposed Supplemental Loan Agreement and shall
          state that copies of the instrument embodying the same are on
          file at the Principal Office of the Trustee for inspection by all
          Owners of the Bonds.  The Authority may enter into, and the
          Trustee may consent to, any such proposed Supplemental Loan
          Agreement subject to the same conditions, and with the same
          effect, as provided by Section 12.03 hereof with respect to
          Supplemental Indentures.


                                     ARTICLE XIII

                                    MISCELLANEOUS

             Section 13.01. Successors of the Authority.  In the event of
          the dissolution of the Authority, all the covenants,
          stipulations, promises and agreements in this Indenture
          contained, by or on behalf of, or for the benefit of, the
          Authority, shall bind or inure to the benefit of the successors
          of the Authority from time to time and any entity, officer,
          board, commission, agency or instrumentality to whom or to which
          any power or duty of the Authority shall be transferred.

             Section 13.02. Parties in Interest.  Except as herein
          otherwise specifically provided, nothing in this Indenture
          expressed or implied is intended or shall be construed to confer
          upon any person, firm or corporation other than the Authority,
          the Company and the Trustee and their successors and assigns and
          the Owners of the Bonds any right, remedy or claim under or by
          reason of this Indenture, this Indenture being intended to be for
          the sole and exclusive benefit of the Authority, the Company and
          the Trustee and their successors and assigns and the Owners of
          the Bonds.

             Section 13.03. Severability.  In case any one or more of the
          provisions of this Indenture or of the Loan Agreement or of the
          Bonds shall, for any reason, be held to be illegal or invalid,
          such illegality or invalidity shall not affect any other
          provisions of this Indenture or of the Loan Agreement or of such
          Bonds, and this Indenture and the Loan Agreement and such Bonds
          shall be construed and enforced as if such illegal or invalid
          provisions had not been contained herein or therein.

             Section 13.04. No Personal Liability of Authority Officials. 
          No covenant or agreement contained in the Bonds or in this
          Indenture shall be deemed to be the covenant or agreement of any
          director, official, officer, agent, or employee of the Authority
          in his individual capacity, and neither the members of the Board
          of Directors of the Authority nor any official executing the
          Bonds shall be liable personally on the Bonds or be subject to
          any personal liability or accountability by reason of the
          issuance thereof.

             Section 13.05. Bonds Owned by the Authority or the Company. 
          In determining whether Owners of the requisite aggregate
          principal amount of the Bonds have concurred in any direction,
          consent or waiver under this Indenture, Bonds which are owned by
          the Authority or the Company or by any person directly or
          indirectly controlling or controlled by or under direct or
          indirect common control with the Company (unless the Authority,
          the Company or such person owns all Bonds which are then
          Outstanding, determined without regard to this Section 13.05)
          shall be disregarded and deemed not to be Outstanding for the
          purpose of any such determination, except that, for the purpose
          of determining whether the Trustee shall be protected in relying
          on any such direction, consent or waiver, only Bonds which the
          Trustee knows are so owned shall be so disregarded.  Upon the
          request of the Trustee, the Company and the Authority shall
          furnish to the Trustee a certificate identifying all Bonds, if
          any, actually known to either of them to be owned or held by or
          for the account of any of the above-described persons, and the
          Trustee shall be entitled to rely on such certificate as
          conclusive evidence of the facts set forth therein and that all
          other Bonds are Outstanding for the purposes of such
          determination.  Bonds so owned which have been pledged in good
          faith may be regarded as Outstanding if the pledgee establishes
          to the satisfaction of the Trustee the pledgee's right so to act
          with respect to such Bonds and that the pledgee is not the
          Authority or the Company or any person directly or indirectly
          controlling or controlled by or under direct or indirect common
          control with the Company.  In case of a dispute as to such right,
          any decision by the Trustee taken upon the advice of counsel
          shall be full protection to the Trustee.

             Section 13.06. Counterparts.  This Indenture may be executed
          in any number of counterparts, each of which, when so executed
          and delivered, shall be an original; but such counterparts shall
          together constitute but one and the same Indenture.

             Section 13.07. Governing Law.  The laws of the State of
          Arizona shall govern the construction and enforcement of this
          Indenture and of all Bonds, except that the laws of the State of
          New York shall govern the construction and enforcement of the
          rights and duties of the Trustee hereunder and the construction
          of Section 13.09 hereof and the computation of any period of
          grace provided herein.

             Section 13.08. Notices.  Except as otherwise provided in this
          Indenture, all notices, certificates, requests requisitions or
          other communications by the Authority, the Company, the Trustee,
          the Paying Agent, any Co-Paying Agent or the Registrar pursuant
          to this Indenture shall be in writing and shall be sufficiently
          given and shall be deemed given when mailed by registered mail,
          postage prepaid, addressed as follows: If to the Authority, c/o
          Russo, Cox & Russo, P.C., 1820 East River Road, Suite 230,
          Tucson, Arizona 85718; if to the Company, at 220 West Sixth
          Street, Tucson, Arizona 85702, Attention: Treasurer; if to the
          Trustee, at 100 Wall Street, Suite 1600, New York, New York
          10005, Attention: Vice President; if to the Paying Agent, any
          Co-Paying Agent or the Registrar, at the address designated in
          the acceptance of appointment or engagement.  Any of the
          foregoing may, by notice given hereunder to each of the others,
          designate any further or different addresses to which subsequent
          notices, certificates, requests or other communications shall be
          sent hereunder.

             Section 13.09. Holidays.  If the date for making any payment
          or the last date for performance of any act or the exercising of
          any right, as provided in this Indenture, shall be a Saturday,
          Sunday or a public holiday in the city in which is located the
          Principal Office of the Trustee, such payment may be made or act
          performed or right exercised on the next succeeding business day,
          with the same force and effect as if done on the nominal date
          provided in this Indenture, and no interest shall accrue for the
          period after such nominal date.  If the last day of any period of
          grace, as provided in this Indenture, shall be a Saturday, Sunday
          or a public holiday in the city in which is located the Principal
          Office of the Trustee, the last day of such period of grace shall
          be deemed to be the next succeeding business day.

             Section 13.10. Statutory Notice Regarding Cancellation of
          Contracts.  As required by the provisions of Section 38-511,
          Arizona Revised Statutes, as amended, notice is hereby given that
          political subdivisions of the State of Arizona or any of their
          departments or agencies may, within three (3) years of its
          execution, cancel any contract, without penalty or further
          obligation, made by the political subdivisions or any of their
          departments or agencies on or after September 30, 1988, if any
          person significantly involved in initiating, negotiating,
          securing, drafting or creating the contract on behalf of the
          political subdivisions or any of their departments or agencies
          is, at any time while the contract or any extension of the
          contact is in effect, an employee or agent of any other party to
          the contract in any capacity or a consultant to any other party
          of the contract with respect to the subject matter of the
          contract.

             The Trustee covenants and agrees not to employ as an employee,
          agent or, with respect to the subject matter of this Indenture, a
          consultant, any person actually known by the Trustee to be
          significantly involved in initiating, negotiating, securing,
          drafting or creating such Indenture on behalf of the Authority
          within three (3) years from the execution hereof, unless a waiver
          is provided by the Authority.


     <PAGE>


              IN WITNESS WHEREOF, The Industrial Development Authority of
          the County of Pima has caused this Indenture to be executed by
          its President and First Trust of New York, National Association
          has caused this Indenture to be executed on its behalf by its
          Vice President, all as of the day and year first above written.


                                   THE INDUSTRIAL DEVELOPMENT AUTHORITY
                                   OF THE COUNTY OF PIMA

                                   By:  /s/ Stanley Lehman
                                       ----------------------------------
                                       President



                                   FIRST TRUST OF NEW YORK,
                                   NATIONAL ASSOCIATION



                                   By:  /s/ P.J. Crowley
                                       ----------------------------------
                                       Vice President


     <PAGE>

                                                                  EXHIBIT A

                                    (FORM OF BOND)

          No.


                         THE INDUSTRIAL DEVELOPMENT AUTHORITY
                                OF THE COUNTY OF PIMA
                         INDUSTRIAL DEVELOPMENT REVENUE BOND,
                                    1997 SERIES A
                       (TUCSON ELECTRIC POWER COMPANY PROJECT)

          INTEREST RATE (PER ANNUM):
          MATURITY DATE:                                    DATED:
          CUSIP:
          REGISTERED OWNER:
          PRINCIPAL AMOUNT:                                 DOLLARS


             The Industrial Development Authority of the County of Pima, an
          Arizona nonprofit corporation designated by law as a political
          subdivision of the State of Arizona (the "Authority"), for value
          received, hereby promises to pay (but only out of the Receipts
          and Revenues of the Authority from the Loan Agreement, as
          hereinafter defined, and other moneys pledged therefor) to the
          Registered Owner identified above or registered assigns, on the
          Maturity Date set forth above, upon the presentation and
          surrender hereof, the Principal Amount set forth above and to pay
          (but only out of the Receipts and Revenues of the Authority from
          the Loan Agreement and other moneys pledged therefor), interest
          on said Principal Amount until payment of said Principal Amount
          has been made or duly provided for, from the date hereof, at the
          Interest Rate set forth above, semi-annually on the first days of
          March and September in each year, commencing March 1, 1998. 
          Interest will be calculated on the basis of a 360-day year of
          twelve 30-day months.

             The principal of and premium, if any, on this Bond are payable
          at the principal office of First Trust of New York, National
          Association, as Paying Agent, or at the principal office of any
          co-paying agent appointed in accordance with the Indenture (as
          hereinafter defined), at the option of the Registered Owner
          hereof.  Interest on this Bond is payable by check drawn upon the
          Paying Agent and mailed to the Registered Owner of this Bond as
          of the close of business on the Record Date (as defined in the
          Indenture), at the registered address of such Registered Owner;
          notwithstanding the foregoing, upon request to the Paying Agent
          by a Registered Owner of not less than $1,000,000 in aggregate
          principal amount of Bonds, interest on such Bonds and, after
          presentation and surrender of such Bonds, the principal thereof
          shall be paid to such Registered Owner by wire transfer to the
          account maintained within the continental United States specified
          by such Registered Owner or, if such Registered Owner maintains
          an account with the entity acting as Paying Agent, by deposit
          into such account.  Payment of the principal of and premium, if
          any, and interest on this Bond shall be in any coin or currency
          of the United States of America as, at the respective times of
          payment, shall be legal tender for the payment of public and
          private debts.

             This Bond is one of the duly authorized Industrial Development
          Revenue Bonds, 1997 Series A (Tucson Electric Power Company
          Project) (the "Bonds") of the Authority, aggregating Twenty-two
          Million Four Hundred Sixty Thousand Dollars ($22,460,000) in
          principal amount, issued under and pursuant to the Constitution
          and laws of the State of Arizona, particularly Title 35,
          Chapter 5, Arizona Revised Statutes, as amended (the "Act"), and
          the Indenture of Trust, dated as of September 15, 1997 (the
          "Indenture"), between the Authority and First Trust of New York,
          National Association, as trustee (the "Trustee"), for the purpose
          of financing and refinancing a portion of the costs of the
          acquisition, construction, improvement and equipping of certain
          facilities for the furnishing of electric energy (the
          "Facilities").  Pursuant to the Loan Agreement, dated as of
          September 15, 1997 (the "Loan Agreement"), between the Authority
          and Tucson Electric Power Company, a corporation organized and
          existing under the laws of the State of Arizona (the "Company"),
          the proceeds of the Bonds, other than accrued interest, if any,
          paid by the initial purchasers thereof, will be loaned from time
          to time to the Company.

             Neither Pima County, Arizona nor the State of Arizona shall in
          any event be liable for the payment of the principal of or
          premium, if any, or interest on the Bonds, and neither the Bonds,
          nor the premium, if any, or the interest thereon, shall be
          construed to constitute an indebtedness of Pima County, Arizona
          or the State of Arizona within the meaning of any constitutional
          or statutory provisions whatsoever.  The Bonds and the premium,
          if any, and the interest thereon are limited obligations of the
          Authority payable solely from the Receipts and Revenues of the
          Authority from the Loan Agreement and other moneys pledged
          therefor under the Indenture.

             The Bonds are equally and ratably secured, to the extent
          provided in the Indenture, by the pledge thereunder of the
          "Receipts and Revenues of the Authority from the Loan Agreement",
          which term is used herein as defined in the Indenture and which
          as therein defined means all moneys paid or payable to the
          Trustee for the account of the Authority by the Company in
          respect of the loan payments, including all receipts of the
          Trustee which, under the provisions of the Indenture, reduce the
          amounts of such payments. The Authority has also pledged and
          assigned to the Trustee as security for the Bonds all other
          rights and interests of the Authority under the Loan Agreement
          (other than its rights to indemnification and its administrative
          expenses and certain other rights).

             The transfer of this Bond shall be registered upon the
          registration books kept at the principal office of First Trust of
          New York, National Association, as Registrar, at the written
          request of the Registered Owner hereof or his attorney duly
          authorized in writing, upon surrender of this Bond at said
          office, together with a written instrument of transfer
          satisfactory to the Registrar duly executed by the Registered
          Owner or his duly authorized attorney.

             In the manner and with the effect provided in the Indenture,
          each of the Bonds may be redeemed prior to maturity, as follows:

               (a)  The Bonds shall be subject to redemption by the
             Authority, at the direction of the Company, on any date on or
             after September 1, 2002 in whole at any time or in part from
             time to time, at the applicable redemption price (expressed as
             a percentage of principal amount) set forth below, plus
             accrued interest to the redemption date:

                       Redemption Period              Redemption Price
                       -----------------              ----------------
           September 1, 2002 through August 31, 2003       102%
           September 1, 2003 through August 31, 2004       101%
           September 1, 2004 and thereafter                100%

               (b)  The Bonds shall be subject to redemption by the
             Authority, at the direction of the Company, in whole at any
             time at the principal amount thereof plus accrued interest to
             the redemption date, if:

                  (i) the Company shall have determined that the continued
               operation of the Facilities is impracticable, uneconomical
               or undesirable for any reason;

                  (ii) all or substantially all of the Facilities shall
               have been condemned or taken by eminent domain; or

                  (iii) the operation of the Facilities shall have been
               enjoined or shall have otherwise been prohibited by, or
               shall conflict with, any order, decree, rule or regulation
               of any court or of any federal, state or local regulatory
               body, administrative agency or other governmental body.

               (c)  The Bonds shall be subject to mandatory redemption by
             the Authority, at the principal amount thereof plus accrued
             interest to the redemption date, on the 180th day (or such
             earlier date as may be designated by the Company) after a
             final determination by a court of competent jurisdiction or an
             administrative agency, to the effect that, as a result of a
             failure by the Company to perform or observe any covenant,
             agreement or representation contained in the Loan Agreement,
             the interest payable on the Bonds is included for federal
             income tax purposes in the gross income of the owners thereof,
             other than any owner of a Bond who is a "substantial user" of
             the Facilities or a "related person" within the meaning of
             Section 147(a) of the Internal Revenue Code of 1986 (the
             "Code").  No determination by any court or administrative
             agency shall be considered final for the purposes of this
             paragraph (c) unless the Company shall have been given timely
             notice of the proceeding which resulted in such determination
             and an opportunity to participate in such proceeding, either
             directly or through an owner of a Bond, and until the
             conclusion of any appellate review sought by any party to such
             proceeding or the expiration of the time for seeking such
             review. The Bonds shall be redeemed either in whole or in part
             in such principal amount that, in the opinion of Bond Counsel,
             the interest payable on the Bonds, including the Bonds
             remaining outstanding after such redemption, would not be
             included in the gross income of any owner thereof, other than
             an owner of a Bond who is a "substantial user" of the
             Facilities or a "related person" within the meaning of Section
             147(a) of the Code.

               (d)  In the event that the aggregate of the amounts, if any,
             of the proceeds of the Bonds remaining unexpended upon the
             completion of the Facilities or upon the termination of the
             acquisition and construction thereof, together with any income
             or other gain from the investment thereof, shall at any time,
             or from time to time, be equal to or greater than $5,000, the
             Authority shall redeem the Bonds, at the principal amount
             thereof plus accrued interest to the redemption date, in the
             largest aggregate principal amount which does not exceed the
             amount of such proceeds together with income or other gain on
             an interest payment date determined as set forth in, and
             otherwise in accordance with the provisions of, the Indenture;
             provided, however, that the Company may direct that such
             proceeds and income be applied to the purchase of the Bonds or
             in any other manner which will not impair the validity of the
             Bonds or the exemption from gross income for federal tax
             purposes of the interest thereon.

             If less than all of the Bonds at the time outstanding are to
          be called for redemption, the particular Bonds or portions of
          Bonds to be redeemed shall be selected by the Trustee, in such
          manner as the Trustee in its discretion may deem proper, in the
          principal amounts designated to the Trustee by the Company or
          otherwise as required by the Indenture.

             In the event any of the Bonds are called for redemption, the
          Trustee shall give notice, in the name of the Authority, of the
          redemption of such Bonds.  Such notice shall be given by mailing
          a copy of the redemption notice by first-class mail at least
          thirty (30) days prior to the date fixed for redemption to the
          Registered Owners of the Bonds to be redeemed at the addresses
          shown on the registration books; provided, however, that failure
          duly to give such notice by mailing, or any defect therein, shall
          not affect the validity of any proceedings for the redemption of
          the Bonds as to which there shall be no such failure or defect.

             With respect to any notice of redemption of Bonds in
          accordance with the redemption provisions lettered (a) or (b)
          above, unless, upon the giving of such notice, such Bonds shall
          be deemed to have been paid within the meaning of the Indenture,
          such notice shall state that such redemption, shall be
          conditional upon the receipt, by the Trustee on or prior to the
          opening of business on the date fixed for such redemption of
          moneys sufficient to pay the principal of and premium, if any,
          and interest on such Bonds to be redeemed, and that if such
          moneys shall not have been so received said notice shall be of no
          force and effect and the Authority shall not be required to
          redeem such Bonds. In the event that such notice of redemption
          contains such a condition and such moneys are not so received,
          the redemption shall not be made and the Trustee shall within a
          reasonable time thereafter give notice, in the manner in which
          the notice of redemption was given, that such moneys were not so
          received.

             If a notice of redemption shall be unconditional, or if the
          conditions of a conditional notice of redemption shall have been
          satisfied, then upon presentation and surrender of Bonds so
          called for redemption at the place or places of payment, such
          Bonds shall be redeemed.

             Any Bonds and portions of Bonds which have been duly selected
          for redemption shall cease to bear interest on the specified
          redemption date provided that moneys sufficient to pay the
          principal of, premium, if any, and interest on such Bonds shall
          be on deposit with the Trustee on the date fixed for redemption
          so that such Bonds will be deemed to be paid in accordance with
          the Indenture and such Bonds shall thereafter cease to be
          entitled to any lien, benefit or security under the Indenture.

             The Registered Owner of this Bond shall have no right to
          enforce the provisions of the Indenture, or to institute action
          to enforce the covenants therein, or to take any action with
          respect to any default under the Indenture, or to institute,
          appear in or defend any suit or other proceeding with respect
          thereto, except as provided in the Indenture.

             With certain exceptions as provided therein, the Indenture and
          the Loan Agreement may be modified or amended only with the
          consent of the Registered Owners of a majority in aggregate
          principal amount of all Bonds outstanding under the Indenture
          which would be adversely affected thereby.

             Reference is hereby made to the Indenture and the Loan
          Agreement, copies of which are on file with the Trustee, for the
          provisions, among others, with respect to the nature and extent
          of the rights, duties and obligations of the Authority, the
          Company, the Trustee and the Registered Owners of the Bonds.  The
          Registered Owner of this Bond, by the acceptance hereof, is
          deemed to have agreed and consented to the terms and provisions
          of the Indenture and the Loan Agreement.

             Among other things, as provided in the Indenture and subject
          to certain limitations therein set forth, this Bond or any
          portion of the principal amount hereof will be deemed to have
          been paid within the meaning and with the effect expressed in the
          Indenture, and the entire indebtedness of the Authority in
          respect thereof shall be satisfied and discharged, if there has
          been irrevocably deposited with the Trustee, in trust, money in
          an amount which will be sufficient and/or Government Obligations
          (as defined in the Indenture), the principal of and interest on
          which, when due, without regard to any reinvestment thereof, will
          provide moneys which, together with moneys deposited with or held
          by the Trustee, will be sufficient, to pay when due the principal
          of and premium, if any, and interest on this Bond or such portion
          of the principal amount hereof when due.

             Among other things, the Loan Agreement contains terms,
          provisions and conditions relating to the consolidation or merger
          of the Company with or into, and the sale, transfer or other
          disposition of assets to, another Person (as defined in the Loan
          Agreement), to the assumption by such other Person, in certain
          circumstances, of all of the obligations of the Company under the
          Loan Agreement and to the release and discharge of the Company,
          in certain circumstances, from such obligations.

             The Authority, the Trustee, the Registrar, the Paying Agent
          and any co-paying agent may deem and treat the person in whose
          name this Bond is registered as the absolute owner hereof for all
          purposes, whether or not this Bond is overdue, and neither the
          Authority, the Trustee, the Paying Agent nor any co-paying agent
          shall be affected by any notice to the contrary.

             It is hereby certified, recited and declared that all acts,
          conditions and things required by the Constitution and laws of
          the State of Arizona to exist, to have happened and to have been
          performed, precedent to and in the execution and delivery of the
          Indenture and the issuance of this Bond, do exist, have happened
          and have been performed in regular and due form as required by
          law.

             No covenant or agreement contained in this Bond or the
          Indenture shall be deemed to be a covenant or agreement of any
          official, officer, agent or employee of the Authority in his
          individual capacity, and neither the members of the Board of
          Directors of the Authority nor any official executing this Bond,
          shall be liable personally on this Bond or be subject to any
          personal liability or accountability by reason of the issuance or
          sale of this Bond.

             This Bond shall not be entitled to any right or benefit under
          the Indenture, or be valid or become obligatory for any purpose,
          until this Bond shall have been authenticated by the execution by
          the Trustee, or its successor as Trustee, of the certificate of
          authentication inscribed hereon.

     <PAGE>

              IN WITNESS WHEREOF, The Industrial Development Authority of
          The County of Pima has caused this Bond to be executed with the
          manual or facsimile signature of its President or Vice President
          and a facsimile of its official seal to be imprinted hereon and
          attested with the manual or facsimile signature of its Secretary
          or Assistant Secretary.

                                        THE INDUSTRIAL DEVELOPMENT
                                        AUTHORITY OF THE COUNTY OF PIMA
          (Seal)


                                        By.................................
                                                President

          ATTEST:

          ...........................................
                  Secretary

     <PAGE>

                                                                  EXHIBIT B


                     (FORM FOR ORDINARY REGISTRATION OF TRANSFER)

                       COMPLETE AND SIGN THIS FORM FOR ORDINARY
                               REGISTRATION OF TRANSFER


          FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
          transfer(s) unto


          Please Insert Social Security Or Other Identifying Number of
          Assignee

          . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

          . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
          Please print or typewrite name and address including postal zip
          code of assignee

          . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
          this bond and all rights thereunder, hereby irrevocably
          constituting and appointing _______________________ attorney to
          register such transfer on the registration books in the principal
          office of the Registrar, with full power of substitution in the
          premises.

          Dated:..............     ........................................
                                   NOTE:  The signature on this assignment
                                   must correspond with the name as written
                                   on the face of this Bond in every
                                   particular, without alteration,
                                   enlargement or any change whatsoever.

     <PAGE>

                                                                  EXHIBIT C

                  (FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION)

                            CERTIFICATE OF AUTHENTICATION

                    This is to certify that this Bond is one of the Bonds
               described in the within-mentioned Indenture.


                         FIRST TRUST OF NEW YORK, NATIONAL ASSOCIATION,
                         as Trustee


                         By................................................
                           Authorized Officer


          Date of Authentication:......................