<PAGE>
                                                                     EXHIBIT 4.5

                            CNA FINANCIAL CORPORATION

                                       TO

                J. P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION

                                     TRUSTEE

                          JUNIOR SUBORDINATED INDENTURE

                          DATED AS OF ___________, ____
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                            PAGE
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<S>                                                                         <C>
ARTICLE I. DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION.......     1
   SECTION 1.1.  DEFINITIONS.............................................     1
   SECTION 1.2.  COMPLIANCE CERTIFICATE AND OPINIONS.....................     9
   SECTION 1.3.  FORMS OF DOCUMENTS DELIVERED TO TRUSTEE.................    10
   SECTION 1.4.  ACTS OF HOLDERS.........................................    10
   SECTION 1.5.  NOTICES, ETC. TO TRUSTEE AND CNAF.......................    13
   SECTION 1.6.  NOTICE TO HOLDERS; WAIVER...............................    13
   SECTION 1.7.  CONFLICT WITH TRUST INDENTURE ACT.......................    13
   SECTION 1.8.  EFFECT OF HEADINGS AND TABLE OF CONTENTS................    13
   SECTION 1.9.  SUCCESSORS AND ASSIGNS..................................    14
   SECTION 1.10. SEPARABILITY CLAUSE.....................................    14
   SECTION 1.11. BENEFITS OF JUNIOR INDENTURE............................    14
   SECTION 1.12. GOVERNING LAW...........................................    14
   SECTION 1.13. NON-BUSINESS DAYS.......................................    14

ARTICLE II. SECURITY FORMS...............................................    15
   SECTION 2.1.  FORMS GENERALLY.........................................    15
   SECTION 2.2.  FORM OF FACE OF SECURITY................................    15
   SECTION 2.3.  FORM OF REVERSE OF SECURITY.............................    19
   SECTION 2.4.  FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.........    22

ARTICLE III. THE SECURITIES..............................................    22
   SECTION 3.1.  TITLE AND TERMS.........................................    22
   SECTION 3.2.  DENOMINATIONS...........................................    24
   SECTION 3.3.  EXECUTION, AUTHENTICATION, DELIVERY AND DATING..........    25
   SECTION 3.4.  TEMPORARY SECURITIES....................................    26
   SECTION 3.5.  REGISTRATION, TRANSFER AND EXCHANGE.....................    27
   SECTION 3.6.  MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES........    29
   SECTION 3.7.  PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED..........    29
   SECTION 3.8.  PERSONS DEEMED OWNERS...................................    31
   SECTION 3.9.  CANCELLATION............................................    31
   SECTION 3.10. COMPUTATION OF INTEREST.................................    31
   SECTION 3.11. DEFERRALS OF INTEREST PAYMENT DATES.....................    31
   SECTION 3.12. RIGHT OF SET-OFF........................................    32
   SECTION 3.13. AGREED TAX TREATMENT....................................    32
   SECTION 3.14. EXTENSION OF STATED MATURITY; ADJUSTMENT OF STATED
                 MATURITY UPON AN EXCHANGE...............................    33
   SECTION 3.15. CUSIP NUMBERS...........................................    33
</TABLE>


                                       -i-
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                                TABLE OF CONTENTS
                                   (continued)

<TABLE>
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<S>                                                                         <C>
ARTICLE IV. SATISFACTION AND DISCHARGE...................................    33
   SECTION 4.1.  SATISFACTION AND DISCHARGE OF JUNIOR INDENTURE..........    33
   SECTION 4.2.  APPLICATION OF TRUST FUNDS..............................    35
   SECTION 4.3.  SATISFACTION, DISCHARGE AND DEFEASANCE OF SECURITIES
                 OF ANY SERIES...........................................    35

ARTICLE V. REMEDIES......................................................    36
   SECTION 5.1.  EVENTS OF DEFAULT.......................................    36
   SECTION 5.2.  ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT......    37
   SECTION 5.3.  COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT
                 BY TRUSTEE..............................................    38
   SECTION 5.4.  TRUSTEE MAY FILE PROOFS OF CLAIM........................    39
   SECTION 5.5.  TRUSTEE MAY ENFORCE CLAIM WITHOUT POSSESSION OF
                 SECURITIES..............................................    40
   SECTION 5.6.  APPLICATION OF MONEY COLLECTED..........................    40
   SECTION 5.7.  LIMITATION ON SUITS.....................................    40
   SECTION 5.8.  UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL,
                 INTEREST AND OTHER AMOUNTS..............................    41
   SECTION 5.9.  RESTORATION OF RIGHTS AND REMEDIES......................    41
   SECTION 5.10. RIGHTS AND REMEDIES CUMULATIVE..........................    42
   SECTION 5.11. DELAY OR OMISSION NOT WAIVER............................    42
   SECTION 5.12. CONTROL BY HOLDERS OF SECURITIES........................    42
   SECTION 5.13. WAIVER OF PAST DEFAULTS.................................    42
   SECTION 5.14. UNDERTAKING FOR COSTS...................................    43

ARTICLE VI. THE TRUSTEE..................................................    43
   SECTION 6.1.  CERTAIN DUTIES AND RESPONSIBILITIES.....................    43
   SECTION 6.2.  NOTICE OF DEFAULTS......................................    44
   SECTION 6.3.  CERTAIN RIGHTS OF TRUSTEE...............................    45
   SECTION 6.4.  NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF
                 SECURITIES..............................................    46
   SECTION 6.5.  MAY HOLD SECURITIES.....................................    46
   SECTION 6.6.  MONEY HELD IN TRUST.....................................    46
   SECTION 6.7.  COMPENSATION AND REIMBURSEMENT..........................    46
   SECTION 6.8.  DISQUALIFICATION; CONFLICTING INTERESTS.................    47
   SECTION 6.9.  CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.................    47
   SECTION 6.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.......    48
   SECTION 6.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR..................    49
   SECTION 6.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
                 BUSINESS................................................    50
   SECTION 6.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST CNAF..........    50
   SECTION 6.14. APPOINTMENT OF AUTHENTICATING AGENT.....................    50
</TABLE>


                                      -ii-
<PAGE>
                                TABLE OF CONTENTS
                                   (continued)

<TABLE>
<CAPTION>
                                                                            PAGE
                                                                            ----
<S>                                                                         <C>
ARTICLE VII. HOLDER'S LISTS AND REPORTS BY TRUSTEE AND CNAF..............    52
   SECTION 7.1.  DISCLOSURE OF NAMES AND ADDRESSES OF HOLDERS............    52
   SECTION 7.2.  PRESERVATION OF INFORMATION, COMMUNICATIONS TO
                 HOLDERS.................................................    52
   SECTION 7.3.  REPORTS BY TRUSTEE......................................    53
   SECTION 7.4.  REPORTS BY CNAF.........................................    53

ARTICLE VIII. CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE.......    53
   SECTION 8.1.  CNAF MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.......    53
   SECTION 8.2.  SUCCESSOR PERSON SUBSTITUTED............................    54

ARTICLE IX. SUPPLEMENTAL INDENTURES......................................    55
   SECTION 9.1.  SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS......    55
   SECTION 9.2.  SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.........    56
   SECTION 9.3.  EXECUTION OF SUPPLEMENTAL INDENTURES....................    57
   SECTION 9.4.  EFFECT OF SUPPLEMENTAL INDENTURES.......................    57
   SECTION 9.5.  CONFORMITY WITH TRUST INDENTURE ACT.....................    57
   SECTION 9.6.  REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES......    58

ARTICLE X. COVENANTS.....................................................    58
   SECTION 10.1. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST..............    58
   SECTION 10.2. MAINTENANCE OF OFFICE OR AGENCY.........................    58
   SECTION 10.3. MONEY FOR SECURITY PAYMENTS TO BE HELD IN TRUST.........    59
   SECTION 10.4. STATEMENT AS TO COMPLIANCE..............................    60
   SECTION 10.5. WAIVER OF CERTAIN COVENANTS.............................    60
   SECTION 10.6. ADDITIONAL SUMS.........................................    60
   SECTION 10.7. ADDITIONAL COVENANTS....................................    61

ARTICLE XI. REDEMPTION OF SECURITIES.....................................    62
   SECTION 11.1. APPLICABILITY OF THIS ARTICLE...........................    62
   SECTION 11.2. ELECTION TO REDEEM; NOTICE TO TRUSTEE...................    62
   SECTION 11.3. SELECTION BY TRUSTEE OF SECURITIES TO BE REDEEMED.......    62
   SECTION 11.4. NOTICE OF REDEMPTION....................................    63
   SECTION 11.5. DEPOSIT OF REDEMPTION PRICE.............................    63
   SECTION 11.6. PAYMENT OF SECURITIES CALLED FOR REDEMPTION.............    64
   SECTION 11.7. CNAF'S RIGHT OF REDEMPTION..............................    64

ARTICLE XII. SINKING FUNDS...............................................    65
   SECTION 12.1. APPLICABILITY OF ARTICLE................................    65
</TABLE>


                                      -iii-
<PAGE>
                                TABLE OF CONTENTS
                                   (continued)

<TABLE>
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<S>                                                                         <C>
   SECTION 12.2.  SATISFACTION OF SINKING FUND PAYMENTS WITH
                  SECURITIES.............................................    65
   SECTION 12.3.  REDEMPTION OF SECURITIES FOR SINKING FUND..............    65

ARTICLE XIII. SUBORDINATION OF SECURITIES................................    67
   SECTION 13.1.  SECURITIES SUBORDINATE TO SENIOR DEBT..................    67
   SECTION 13.2.  PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.........    67
   SECTION 13.3.  PRIOR PAYMENT TO SENIOR DEBT UPON ACCELERATION OF
                  SECURITIES.............................................    68
   SECTION 13.4.  NO PAYMENT WHEN SENIOR DEBT IN DEFAULT.................    69
   SECTION 13.5.  PAYMENT PERMITTED IF NO DEFAULT........................    69
   SECTION 13.6.  SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR DEBT........    70
   SECTION 13.7.  PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS............    70
   SECTION 13.8.  TRUSTEE TO EFFECTUATE SUBORDINATION....................    70
   SECTION 13.9.  NO WAIVER OF SUBORDINATION PROVISIONS..................    71
   SECTION 13.10. NOTICE TO TRUSTEE......................................    71
   SECTION 13.11. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF
                  LIQUIDATING AGENT......................................    71
   SECTION 13.12. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR DEBT.......    72
   SECTION 13.13. RIGHTS OF TRUSTEE AS HOLDER OF SENIOR DEBT;
                  PRESERVATION OF TRUSTEE'S RIGHTS.......................    72
   SECTION 13.14. ARTICLE APPLICABLE TO PAYING AGENTS....................    72
   SECTION 13.15. CERTAIN CONVERSIONS OR EXCHANGES.......................    72
</TABLE>


                                      -iv-
<PAGE>
                            CNA FINANCIAL CORPORATION

     Reconciliation and tie between the Trust Indenture Act of 1939 (including
cross-references to provisions of Sections 310 to and including 318 which,
pursuant to Section 318(c) of the Trust Indenture Act of 1939, as amended by the
Trust Reform Act of 1990, are a part of and govern the Junior Indenture whether
or not physically contained therein) and the Junior Subordinated Indenture,
dated as of _______, ____.

<TABLE>
<CAPTION>
Trust Indenture                                                      Junior
  Act Section                                                  Indenture Section
---------------                                                -----------------
<S>                                                            <C>
310 (a) (1), (2) and (5)....................................                6.9
    (a) (3).................................................     Not Applicable
    (a) (4).................................................     Not Applicable
    (b).....................................................          6.8, 6.10
    (c).....................................................     Not Applicable
311 (a).....................................................            6.13(a)
    (b).....................................................            6.13(b)
    (b) (2).................................................         7.3(a) (2)
312 (a).....................................................        7.1, 7.2(a)
    (b).....................................................             7.2(b)
    (c).....................................................             7.2(c)
313 (a).....................................................             7.3(a)
    (b).....................................................             7.3(b)
    (c).....................................................     7.3(a), 7.3(b)
    (d).....................................................             7.3(c)
314 (a) (1), (2) and (3)....................................                7.4
    (a) (4).................................................               10.5
    (b).....................................................     Not Applicable
    (c) (1).................................................                1.2
    (c) (2).................................................                1.2
    (c) (3).................................................     Not Applicable
    (d).....................................................     Not Applicable
    (e).....................................................                1.2
    (f).....................................................     Not Applicable
315 (a).....................................................             6.1(a)
    (b).....................................................    6.2, 7.3(a) (6)
    (c).....................................................             6.1(b)
    (d).....................................................             6.1(c)
    (d) (1).................................................         6.1(a) (1)
    (d) (2).................................................         6.1(c) (2)
    (d) (3).................................................         6.1(c) (3)
    (e).....................................................               5.14
316 (a).....................................................                1.1
    (a) (1) (A).............................................               5.12
    (a) (1) (B).............................................               5.13
    (a) (2).................................................     Not Applicable
</TABLE>


                                       -v-
<PAGE>
<TABLE>
<S>                                                                      <C>
    (b).....................................................                5.8
317 (c).....................................................             1.4(f)
    (a) (1).................................................                5.3
    (a) (2).................................................                5.4
    (b).....................................................               10.3
318 (a).....................................................                1.7
</TABLE>

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


                                      -vi-
<PAGE>
     JUNIOR SUBORDINATED INDENTURE ("Junior Indenture"), dated as of _________,
____, between CNA FINANCIAL CORPORATION, a Delaware corporation (hereinafter
called "CNAF") having its principal office at CNA Center, Chicago, Illinois
60685, and J. P. Morgan Trust Company, National Association, a national banking
association, as Junior Indenture Trustee (hereinafter called the "Trustee")
having an office at 55 West Monroe Street, 15th Floor, Chicago, Illinois 60602.

                                RECITALS OF CNAF

     CNAF has duly authorized the execution and delivery of this Junior
Indenture to provide for the issuance from time to time of its unsecured junior
subordinated debt securities in series (hereinafter called the "Securities") of
substantially the tenor hereinafter provided, including, without limitation,
Securities issued to evidence loans made to CNAF of the proceeds from the
issuance from time to time by one or more business trusts (each a "CNA Capital
Trust," and, collectively, the "CNA Capital Trusts") of preferred trust
interests in such Trusts (the "Preferred Securities") and common interests in
such Trusts (the "Common Securities" and, collectively with the Preferred
Securities, the "Trust Securities"), and to provide the terms and conditions
upon which the Securities are to be authenticated, issued and delivered.

     All things necessary to make the Securities, when executed by CNAF and
authenticated and delivered hereunder and duly issued by CNAF, the valid
obligations of CNAF, and to make this Junior Indenture a valid agreement of
CNAF, in accordance with their and its terms, have been done.

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

                                   ARTICLE I.
             DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

     SECTION 1.1. DEFINITIONS.

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

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

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

     (3) All accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles,
and the term "generally accepted accounting principles" with respect to any
computation required or permitted hereunder shall mean such accounting
principles which are generally accepted at the date or time of such
<PAGE>
computation; provided, that when two or more principles are so generally
accepted, it shall mean that set of principles consistent with those in use by
CNAF; and

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

     Certain terms, used principally in Article Six, are defined in that
Article.

     "Act" when used with respect to any Holder, has the meaning specified in
Section 1.4.

     "Additional Interest" means the interest, if any, that shall accrue on any
interest on the Securities of any series the payment of which has not been made
on the applicable Interest Payment Date and which shall accrue at the rate per
annum specified or determined as specified in such Security.

     "Additional Sums" has the meaning specified in Section 10.6.

     "Additional Taxes" means the sum of any additional taxes, duties and other
governmental charges to which a CNA Capital Trust has become subject from time
to time as a result of a Tax Event.

     "Administrative Trustee" means, in respect of any CNA Capital Trust, each
Person identified as an "Administrative Trustee" in the related Trust Agreement,
solely in such Person's capacity as Administrative Trustee of such CNA Capital
Trust under such Trust Agreement and not in such Person's individual capacity,
or any successor administrative trustee appointed as therein provided.

     "Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person; provided, however, that an Affiliate of CNAF
shall not be deemed to include any CNA Capital Trust to which Securities have
been issued. For the purposes of this definition, "control" when used with
respect to any specified Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.

     "Authenticating Agent" means any Person authorized by the Trustee pursuant
to Section 6.14 to act on behalf of the Trustee to authenticate Securities of
one or more series.

     "Board of Directors" means either the board of directors of CNAF or any
committee of that board duly authorized to act hereunder.

     "Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of CNAF to have been duly adopted by the Board of
Directors, or such committee of the Board of Directors or officers of CNAF to
which authority to act on behalf of the Board of Directors has been delegated,
and to be in full force and effect on the date of such certification, and
delivered to the Trustee.


                                       2
<PAGE>
     "Business Day" means any day other than (i) a Saturday or Sunday or (ii) a
day on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed.

     "CNA Capital Trust" has the meaning specified in the first recital of this
Junior Indenture.

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

     "CNAF Guarantee" means the guarantee by CNAF in respect of the Preferred
Securities of a CNA Capital Trust to the extent provided in the Guarantee
Agreement, substantially in the form attached hereto as Annex C, or
substantially in such form as may be specified as contemplated by Section 3.1
with respect to the Securities of any series, in each case as amended from time
to time.

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

     "Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Securities Exchange Act of 1934, or if at
any time after the execution of this instrument such Commission is not existing
and performing the duties now assigned to it under the Trust Indenture Act, then
the body performing such duties on such date.

     "Common Securities" has the meaning specified in the first recital of this
Junior Indenture.

     "Common Stock" means the common stock, without par value, of CNAF.

     "Corporate Trust Office" means the principal office of the Trustee at which
at any particular time its corporate trust business shall be administered.

     "Corporation" includes a corporation, association, joint stock, limited
liability or other company or business trust.

     "Debt" means, with respect to any Person, whether recourse as to all or a
portion of the assets of such Person and whether or not contingent, (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; (vi) all


                                       3
<PAGE>
indebtedness of CNAF whether incurred on or prior to the date of this Junior
Indenture or thereafter incurred, for claims in respect of derivative products,
futures contracts including interest rate, foreign exchange rate and commodity
forward contracts, options and swaps and similar arrangements; and (vii) every
obligation of the type referred to in clauses (i) through (vi) of another Person
and all dividends of another Person the payment of which, in either case, such
Person has guaranteed or is responsible or liable for, directly or indirectly,
as obligor or otherwise.

     "Defaulted Interest" has the meaning specified in Section 3.7.

     "Depository" means, with respect to the Securities of any series issuable
or issued in whole or in part in the form of one or more Global Securities, the
Person designated as Depository by CNAF pursuant to Section 3.1 with respect to
such series (or any successor thereto).

     "Discount Security" means any Security which provides for an amount less
than the principal amount thereof to be due and payable upon a declaration of
acceleration of the Maturity thereof pursuant to Section 5.2.

     "Distributions," with respect to the Trust Securities issued by a CNA
Capital Trust, means amounts payable in respect of such Trust Securities as
provided in the related Trust Agreement and referred to therein as
"Distributions."

     "Dollar" means the currency of the United States of America that, as at the
time of payment, is legal tender for the payment of public and private debts.

     "Event of Default," unless otherwise specified in the supplemental
indenture, Board Resolution, or the Officers' Certificate delivered pursuant to
Section 3.1 creating a series of Securities, has the meaning specified in
Section 5.1.

     "Exchange Act" means the Securities Exchange Act of 1934, as amended.

     "Extension Period" has the meaning specified in Section 3.11.

     "Foreign Currency" means (i) any currency, including, without limitation,
the Euro, issued by the government of one or more countries other than the
United States of America or by any recognized confederation or association of
such governments and (ii) any currency unit.

     "Global Security" means a Security in the form prescribed in Section 2.4
evidencing all or part of a series of Securities, issued to the Depository or
its nominee for such series, and registered in the name of such Depository or
its nominee.

     "Government Obligations" means securities which are (i) direct obligations
of the United States of America or the government which issued the Foreign
Currency in which the Securities of a particular series are payable, for the
payment of which its full faith and credit is pledged or (ii) obligations of a
Person controlled or supervised by and acting as an agency or instrumentality of
the United States of America or such government which issued the Foreign
Currency in which the Securities of such series are payable, the timely payment
of which is unconditionally


                                       4
<PAGE>
guaranteed by the United States of America or such government which issued the
Foreign Currency in which the Securities of such series are payable, and which,
in either case, are full faith and credit obligations of the United States of
America or such government which issued the Foreign Currency in which the
Securities of such series are payable, and are not callable or redeemable at the
option of the issuer thereof and shall also include a depository receipt issued
by a bank (as defined in Section 3(a)(2) of the Securities Act of 1933, as
amended) as custodian with respect to any such Government Obligation or a
specific payment of interest on or principal of any such Government Obligation
held by such custodian for the account of the holder of such depository receipt;
provided that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depository
receipt from any amount received by the custodian in respect of the Government
Obligation or the specific payment of interest on or principal of the Government
Obligation evidenced by such depository receipt.

     "Guarantee Agreement" means the Guarantee Agreement substantially in the
form attached hereto as Annex C, or substantially in such form as may be
specified as contemplated by Section 3.1 with respect to the Securities of any
series, in each case as amended from time to time.

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

     "Interest Payment Date" means as to each series of Securities the Stated
Maturity of an installment of interest on such Securities.

     "Interest Rate" means the rate of interest specified or determined as
specified in each Security as being payable on such Security.

     "Investment Company Event" means, in respect of a CNA Capital Trust, the
receipt by CNAF and such CNA Capital Trust of an Opinion of Counsel, rendered by
a law firm experienced in such matters, to the effect that, as a result of the
occurrence of a change in law or regulation or a change in interpretation or
application of law or regulation by any legislative body, court, governmental
agency or regulatory authority (a "Change in 1940 Act Law"), such CNA Capital
Trust is or will be considered an "investment company" that is required to be
registered under the 1940 Act, which Change in 1940 Act Law becomes effective on
or after the date of original issuance of the Preferred Securities of such CNA
Capital Trust.

     "Junior Indenture" means this instrument as originally executed or as it
may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof
and shall include the terms of each particular series of Securities established
as contemplated by Section 3.1.

     "Junior Subordinated Payment" has the meaning specified in Section 13.2.

     "Lien" means any mortgage, pledge, lien, security interest or other
encumbrance.

     "Maturity," when used with respect to any Security, means the date on which
the principal of such Security or an installment of principal becomes due and
payable as therein or


                                       5
<PAGE>
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.

     "1940 Act" means the Investment Company Act of 1940, as amended.

     "Notice of Default" has the meaning specified in Section 5.1(3).

     "Officers' Certificate" means a certificate signed by the Chairman and
Chief Executive Officer, President or any Senior Vice President or Group Vice
President, and by the Treasurer, an Assistant Treasurer, the Controller, the
Secretary or an Assistant Secretary of CNAF, and delivered to the Trustee.

     "Opinion of Counsel" means a written opinion of counsel, who may be counsel
for CNAF, including an employee of CNAF.

     "Original Issue Date" means the date of issuance specified as such in each
Security.

     "Outstanding" means, when used in reference to any Securities, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Junior Indenture, except:

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

     (ii) Securities or portions thereof for whose payment or redemption money
in the necessary amount has been theretofore deposited with the Trustee or any
Paying Agent in trust for the Holders of such Securities; and

     (iii) Securities in substitution for or in lieu of which other Securities
have been authenticated and delivered or which have been paid pursuant to
Section 3.6, unless proof satisfactory to the Trustee is presented that any such
Securities are held by Holders in whose hands such Securities are valid, binding
and legal obligations of CNAF;

provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by CNAF or any other obligor upon the Securities or any Affiliate of CNAF or
such other obligor shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent or waiver, only
Securities which the Trustee knows to be so owned shall be so disregarded.
Securities so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Securities and that the pledgee
is not CNAF or any other obligor upon the Securities or any Affiliate of CNAF or
such other obligor. Upon the written request of the Trustee, CNAF shall furnish
to the Trustee promptly an Officers' Certificate listing and identifying all
Securities, if any, known by CNAF to be owned or held by or for the account of
CNAF, or any other obligor on the Securities or any Affiliate of CNAF or such
obligor, and, subject to the provisions of Section 6.1, the Trustee shall be
entitled to accept such Officers' Certificate as conclusive evidence of the
facts therein set


                                       6
<PAGE>
forth and of the fact that all Securities not listed therein are Outstanding for
the purpose of any such determination.

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

     "Person" means any individual, corporation, partnership, trust, joint
venture, unincorporated organization or government or any agency or political
subdivision thereof.

     "Place of Payment" means, with respect to the Securities of any series, the
place or places where the principal of (and premium, if any) and interest or
other amounts on the Securities of such series are payable pursuant to Sections
3.1 and 3.11.

     "Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any security
authenticated and delivered under Section 3.6 in exchange for or in lieu of a
lost, destroyed or stolen Security shall be deemed to evidence the same debt as
the lost, destroyed or stolen Security.

     "Preferred Securities" has the meaning specified in the first recital of
this Junior Indenture.

     "Proceeding" has the meaning specified in Section 13.2.

     "Property Trustee" means, in respect of any CNA Capital Trust, the
commercial bank or trust company identified as the "Property Trustee" in the
related Trust Agreement, solely in its capacity as Property Trustee of such CNA
Capital Trust under such Trust Agreement and not in its individual capacity, or
its successor in interest in such capacity, or any successor property trustee
appointed as therein provided.

     "Redemption Date," when used with respect to any Security to be redeemed,
in whole or in part, means the date fixed for such redemption by or pursuant to
this Junior Indenture.

     "Redemption Price," when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Junior Indenture.

     "Regular Record Date" for the interest payable on any Interest Payment Date
with respect to the Securities of a series means, unless otherwise provided
pursuant to Section 3.1 with respect to Securities of a series, (i) in the case
of Securities of a series represented by one or more Global Securities, the
Business Day next preceding such Interest Payment Date and (ii) in the case of
Securities of a series not represented by one or more Global Securities, the
date which is fifteen days next preceding such Interest Payment Date (whether or
not a Business Day).

     "Responsible Officer," when used with respect to the Trustee, means any
officer of the Trustee assigned by the Trustee from time to time to administer
its corporate trust matters.

     "Securities" or "Security" means any debt securities or debt security, as
the case may be, authenticated and delivered under this Junior Indenture.


                                       7
<PAGE>
     "Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 3.5.

     "Senior Debt" means the principal of (and premium, if any) and interest, if
any (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to CNAF, whether or not such claim for
post-petition interest is allowed in such proceeding), on Debt, whether incurred
on or prior to the date of this Junior Indenture or thereafter incurred,
including, without limitation, Debt issued pursuant to the Senior Debt Indenture
between CNA Financial Corporation and The First National Bank of Chicago, the
First Supplemental Indenture of the Senior Debt Indenture between CNA Financial
Corporation and The First National Bank of Chicago, the Second Supplemental
Indenture of the Senior Debt Indenture between CNA Financial Corporation and J.
P. Morgan Trust Company, National Association (formerly known as The First
National Bank of Chicago), and the Subordinated Indenture between CNA Financial
Corporation and J. P. Morgan Trust Company, National Association, unless, in the
instrument creating or evidencing the same or pursuant to which the same is
outstanding, it is provided that such obligations are pari passu or are not
superior in right of payment to the Securities or to other Debt which is pari
passu with, or subordinated to, the Securities; provided, however, that Senior
Debt shall not be deemed to include (a) any Debt of CNAF which, when incurred
and without respect to any election under Section 1111(b) of the Bankruptcy
Reform Act of 1978, was without recourse to CNAF, (b) any Debt of CNAF to any of
its Subsidiaries, (c) Debt to any employee of CNAF, (d) any liability for taxes,
(e) Debt or other monetary obligations to trade creditors created or assumed by
CNAF or any of its Subsidiaries in the ordinary course of business in connection
with the obtaining of goods, materials or services and (f) the Securities.

     "Special Event" means a Tax Event or an Investment Company Event.

     "Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.7.

     "Stated Maturity," when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
pursuant to the terms of such Security as the date on which the principal of
such Security or such installment of interest is due and payable, in the case of
such principal, as such date may be changed or extended as provided pursuant to
the terms of such Security and this Junior Indenture.

     "Subsidiary" means a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by CNAF or by one or more other
Subsidiaries, or by CNAF and one or more other Subsidiaries. For purposes of
this definition, "voting stock" means stock or other equity interests which
ordinarily has voting power for the election of directors, trustees or managers,
whether at all times or only so long as no senior class of stock has such voting
power by reason of any contingency.

     "Tax Event" means, with respect to a CNA Capital Trust, the receipt by CNAF
and such CNA Capital Trust of an Opinion of Counsel experienced in such matters
to the effect that, as a result of any amendment to, or change (including any
announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or
therein or as a result of any administrative pronouncement or determination


                                       8
<PAGE>
or judicial decision interpreting or applying such laws or regulations, which
amendment or change is effective or which pronouncement, determination or
decision is announced on or after the date of original issuance of the Preferred
Securities of such CNA Capital Trust, there is more than an insubstantial risk
that (i) such CNA Capital Trust is, or will be within 90 days of the date of
such Opinion of Counsel, subject to United States Federal income tax with
respect to income received or accrued on the corresponding series of Securities,
(ii) interest payable by CNAF on the corresponding series of Securities is not,
or within 90 days of the date of such Opinion of Counsel will not be, deductible
by CNAF, in whole or in part, for United States Federal income tax purposes or
(iii) such CNA Capital Trust is, or will be within 90 days of the date of such
Opinion of Counsel, subject to more than a de minimis amount of other taxes,
duties or other governmental charges.

     "Trust Agreement" means the Amended and Restated Trust Agreement of the
applicable CNA Capital Trust substantially in the form attached hereto as Annex
A, as amended by the form of Second Amended and Restated Trust Agreement
substantially in the form attached hereto as Annex B, or substantially in such
form as may be specified as contemplated by Section 3.1 with respect to the
Securities of any series, in each case as amended from time to time.

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

     "Trust Indenture Act" means the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbb), as amended and as in effect on the date as of this Junior
Indenture, except as provided in Section 9.5.

     "Trust Securities" has the meaning specified in the first recital of this
Junior Indenture.

     SECTION 1.2. COMPLIANCE CERTIFICATE AND OPINIONS.

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

     Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Junior Indenture (other than the certificates
provided pursuant to Section 10.4) shall include:


                                       9
<PAGE>
     (a) a statement that each individual signing such certificate or opinion
has read such covenant or condition and the definitions herein relating thereto;

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

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

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

     SECTION 1.3. FORMS OF DOCUMENTS DELIVERED TO TRUSTEE.

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

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

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

     SECTION 1.4. ACTS OF HOLDERS.

     (a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Junior Indenture to be given to or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments is or are
delivered to the Trustee, and, where it is hereby expressly required, to CNAF.
Such instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for


                                       10
<PAGE>
any purpose of this Junior Indenture and (subject to Section 6.1) conclusive in
favor of the Trustee and CNAF, if made in the manner provided in this Section.

     Without limiting the generality of this Section 1.4, unless otherwise
provided in or pursuant to this Junior Indenture, a Holder, including a
Depository that is a Holder of a Global Security, may make, give or take, by a
proxy, or proxies, duly appointed in writing, any request, demand,
authorization, direction, notice, consent, waiver or other Act provided in or
pursuant to this Junior Indenture to be made, given or taken by Holders, and a
Depository that is a Holder of a Global Security may provide its proxy or
proxies to the beneficial owners of interests in any such Global Security
through such Depository's standing instructions and customary practices.

     The Trustee shall fix a record date for the purpose of determining the
Persons who are beneficial owners of interest in any permanent Global Security
held by a Depository entitled under the procedures of such Depository to make,
give or take, by a proxy or proxies duly appointed in writing, any request,
demand, authorization, direction, notice, consent, waiver or other Act provided
in or pursuant to this Junior Indenture to be made, given or taken by Holders.
If such a record date is fixed, the Holders on such record date or their duly
appointed proxy or proxies, and only such Persons, shall be entitled to make,
give or take such request, demand, authorization, direction, notice, consent,
waiver or other Act, whether or not such Holders remain Holders after such
record date. No such request, demand, authorization, direction, notice, consent,
waiver or other Act shall be valid or effective if made, given or taken more
than 90 days after such record date.

     (b) The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by
the certificate of any notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a Person acting in other than his individual capacity, such certificate or
affidavit shall also constitute sufficient proof of his authority.

     (c) The fact and date of the execution by any Person of any such instrument
or writing, or the authority of the Person executing the same, may also be
proved in any other manner which the Trustee deems sufficient and in accordance
with such reasonable rules as the Trustee may determine.

     (d) The ownership of Securities shall be proved by the Securities Register.

     (e) Any request, demand, authorization, direction, notice, consent, waiver
or other action by the Holder of any Security shall bind every future Holder of
the same Security and the Holder of every Security issued upon the transfer
thereof or in exchange therefor or in lieu thereof in respect of anything done
or suffered to be done by the Trustee or CNAF in reliance thereon, whether or
not notation of such action is made upon such Security.

     (f) CNAF may, but shall not be obligated to, set any day as a record date
for the purpose of determining the Holders of Outstanding Securities of any
series entitled to give, make or take any request, demand, authorization,
direction, notice, consent, waiver or other action provided or permitted by this
Junior Indenture to be given, made or taken by Holders of


                                       11
<PAGE>
Securities of such series, provided that CNAF may not set a record date for, and
the provisions of this paragraph shall not apply with respect to, the giving or
making of any notice, declaration, request or direction referred to in the next
paragraph. If any record date is set pursuant to this paragraph, the Holders of
Outstanding Securities of the relevant series on such record date, and no other
Holders, shall be entitled to take the relevant action, whether or not such
Holders remain Holders after such record date, provided that no such action
shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent CNAF from setting a new record date for any action for
which a record date has previously been set pursuant to this paragraph
(whereupon the record date previously set shall automatically and with no action
by any Person be cancelled and of no effect), and nothing in this paragraph
shall be construed to render ineffective any action taken by Holders of the
requisite principal amount of Outstanding Securities of the relevant series on
the date such action is taken. Promptly after any record date is set pursuant to
this paragraph, CNAF, at its own expense, shall cause notice of such record
date, the proposed action by Holders and the applicable Expiration Date to be
given to the Trustee in writing and to each Holder of Securities of the relevant
series in the manner set forth in Section 1.6.

     The Trustee may set any day as a record date for the purpose of determining
the Holders of Outstanding Securities of any series entitled to join in the
giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 5.2, (iii) any request to institute
proceedings referred to in Section 5.7(b) or (iv) any direction referred to in
Section 5.12, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date, provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record is set
pursuant to this paragraph, the Trustee, at CNAF's expense, shall cause notice
of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to CNAF in writing and to each Holder of Securities
of the relevant series in the manner set forth in Section 1.6.

     With respect to any record date set pursuant to this Section, the party
hereto which sets such record dates may designate any day as the "Expiration
Date" and from time to time may change the Expiration Date to any earlier or
later day, provided that no such change shall be effective unless notice of the
proposed new Expiration Date is given to the other party hereto in writing, and
to each Holder of Securities of the relevant series in the manner set forth in
Section 10.6, on or prior to the existing Expiration Date. If any Expiration
Date is not designated with respect to any record date set pursuant to this
Section, the party hereto which set such record date shall be deemed to have
initially designated the 180th day after such record date as the Expiration Date
with respect thereto, subject to its right to change the Expiration Date as


                                       12
<PAGE>
provided in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.

     (g) Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Security may do so with regard to
all or any part of the principal amount of such Security or by one or more duly
appointed agents each of which may do so pursuant to such appointment with
regard to all or any part of such principal amount.

     SECTION 1.5. NOTICES, ETC. TO TRUSTEE AND CNAF.

     Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or permitted by this Junior Indenture
to be made upon, given or furnished to, or filed with,

     (a) the Trustee by any Holder or by CNAF shall be sufficient for every
purpose hereunder if made, given, furnished or filed in writing to or with the
Trustee at its Corporate Trust office, or

     (b) CNAF by the Trustee or by any Holder shall be sufficient for every
purpose (except as otherwise provided in Section 5.1 hereof) hereunder if in
writing and mailed, first class, postage prepaid, to CNAF addressed to it at the
address of its principal office specified in the first paragraph of this Junior
Indenture or at any other address previously furnished in writing to the Trustee
by CNAF.

     SECTION 1.6. NOTICE TO HOLDERS; WAIVER.

     Where this Junior Indenture provides for notice to Holders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first class postage prepaid, to each Holder
affected by such event, at the address of such Holder as it appears in the
Securities Register, not later than the latest date, and not earlier than the
earliest date, prescribed for the giving of such notice. In any case where
notice to Holders is given by mail, neither the failure to mail such notice, nor
any defect in any notice so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders.

     Where this Junior Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.

     SECTION 1.7. CONFLICT WITH TRUST INDENTURE ACT.

     If any provision of this Junior Indenture limits, qualifies or conflicts
with the duties imposed by any of Sections 310 to 318, inclusive, of the Trust
Indenture Act through operation of Section 318(c) thereof, such imposed duties
shall control.


                                       13
<PAGE>
     SECTION 1.8. EFFECT OF HEADINGS AND TABLE OF CONTENTS.

     The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.

     SECTION 1.9. SUCCESSORS AND ASSIGNS.

     All covenants and agreements in this Junior Indenture by CNAF shall bind
its successors and assigns, whether so expressed or not.

     SECTION 1.10. SEPARABILITY CLAUSE.

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

     SECTION 1.11. BENEFITS OF JUNIOR INDENTURE.

     Nothing in this Junior Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto, any Security Registrar,
any Paying Agent, any Authenticating Agent and their successors hereunder and
the Holders of Senior Debt, the holders of Preferred Securities of the
applicable CNA Capital Trust and the Holders of the Securities and, to the
extent expressly provided in Sections 5.2, 5.8, 5.9, 5.11, 5.13, 9.1 and 9.2,
the Holders of Preferred Stock, any benefit or any legal or equitable right,
remedy or claim under this Junior Indenture. No recourse under or upon any
obligation, covenant or agreement contained in this Indenture, in any Security,
or because of any indebtedness evidenced thereby, shall be had against any
incorporator, as such or against any past, present or future stockholder,
officer of director, as such, of the Company or of any successor, either
directly or through the Company or any successor, under any rule of law, statute
or constitutional provision or by the enforcement of any assessment or by any
legal or equitable proceeding or otherwise, all such liability being expressly
waived and released by the acceptance of the Securities by the Holders thereof
and as part of the consideration for the issue of the Securities.

     SECTION 1.12. GOVERNING LAW.

     This Junior Indenture and the Securities shall be governed by and construed
in accordance with the laws of the State of New York without regard to
principles of conflicts of laws.

     SECTION 1.13. NON-BUSINESS DAYS.

     In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day, then (unless otherwise
specifically specified to the contrary in this Junior Indenture or the
Securities) payment of interest (or premium, if any) or principal need not be
made on such date, but may be made on the next succeeding Business Day (and no
interest shall accrue for the period from and after such Interest Payment Date,
Redemption Date or Stated Maturity, as the case may be, until such next
succeeding Business Day except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the


                                       14
<PAGE>
immediately preceding Business Day (in each case with the same force and effect
as if made on the Interest Payment Date or Redemption Date or at the Stated
Maturity).

                                   ARTICLE II.
                                 SECURITY FORMS

     SECTION 2.1. FORMS GENERALLY.

     The Securities of each series and the Trustee's certificate of
authentication shall be in substantially the forms set forth in this Article, or
in such other form or forms as shall be established by or pursuant to a Board
Resolution or in one or more indentures supplemental hereto, in each case with
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Junior Indenture and may have such letters,
numbers or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with applicable tax laws or the rules of
any securities exchange or as may, consistently herewith, be determined by the
officers executing such securities, as evidenced by their execution of the
Securities. If the form of Securities of any series is established by action
taken pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of CNAF and
delivered to the Trustee at or prior to the delivery of CNAF Order contemplated
by Section 3.3 with respect to the authentication and delivery of such
Securities.

     The Trustee's certificate of authentication shall be substantially in the
form set forth in this Section 2.5.

     The definitive Securities shall be printed, lithographed or engraved or
produced by any combination of these methods, if required by any securities
exchange on which the Securities may be listed, on a steel engraved border or
steel engraved borders or may be produced in any other manner permitted by the
rules of any securities exchange on which the Securities may be listed, all as
determined by the officers executing such Securities, as evidenced by their
execution of such securities.

     SECTION 2.2. FORM OF FACE OF SECURITY.

     [IF THE SECURITY IS A GLOBAL SECURITY, INSERT "THIS SECURITY IS A GLOBAL
SECURITY WITHIN THE MEANING OF THE JUNIOR INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (THE "DEPOSITORY") OR
A NOMINEE OF THE DEPOSITORY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE JUNIOR INDENTURE AND NO TRANSFER
OF THIS SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO
THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN
LIMITED CIRCUMSTANCES.

     UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY (55 WATER STREET, NEW YORK) TO CNA FINANCIAL CORPORATION OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS
REGISTERED IN THE NAME OF CEDE &


                                       15
<PAGE>
CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY AND ANY PAYMENT HEREON IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."] [SUCH OTHER
LEGEND AS MAY BE APPLICABLE FOR A DEPOSITORY OTHER THAN DTC.]

                            CNA FINANCIAL CORPORATION
                               (TITLE OF SECURITY)

No.__________                                                        $__________

     CNA FINANCIAL CORPORATION, a corporation organized and existing under the
laws of Delaware (hereinafter called "CNAF", which term includes any successor
corporation under the Junior Indenture hereinafter referred to), for value
received, hereby promises to pay to, or registered assigns, the principal sum of
____________ Dollars on _________; [PROVIDED THAT CNAF MAY (I) CHANGE THE
MATURITY DATE UPON THE OCCURRENCE OF AN EXCHANGE OF THE SECURITIES FOR THE TRUST
SECURITIES SUBJECT TO CERTAIN CONDITIONS SET FORTH IN SECTION 3.14 OF THE JUNIOR
INDENTURE, WHICH CHANGED MATURITY DATE SHALL IN NO CASE BE EARLIER THAN ______,
________ OR LATER THAN ________, AND (II) EXTEND THE MATURITY DATE SUBJECT TO
CERTAIN CONDITIONS SPECIFIED IN SECTION 3.14 OF THE JUNIOR INDENTURE, WHICH
EXTENDED MATURITY DATE SHALL IN NO CASE BE LATER THAN ______, ________]. CNAF
further promises to pay interest on said principal sum from _______________, or
from the most recent Interest Payment Date (as defined below) on which interest
has been paid or duly provided for, [MONTHLY] [QUARTERLY] [SEMI-ANNUALLY]
[ANNUALLY] [IF APPLICABLE, INSERT "(SUBJECT TO DEFERRAL AS SET FORTH HEREIN)"]
in arrears on [INSERT APPLICABLE INTEREST PAYMENT DATES] of each year,
commencing _________, _________ (each such date, an "Interest Payment Date"), at
the rate of ____% per annum, until the principal hereof shall have become due
and payable, if applicable, plus Additional Interest, if any, until the
principal hereof is paid or duly provided for or made available for payment, and
on any overdue principal and (without duplication and to the extent that payment
of such interest is enforceable under applicable law) on any overdue installment
of interest at the rate of ____% per annum, compounded [MONTHLY] [QUARTERLY]
[SEMI-ANNUALLY] [ANNUALLY]. The amount of interest payable for any period shall
be computed on the basis of twelve 30-day months and a 360-day year. In the
event that any date on which interest is payable on this Security is not a
Business Day (as defined below), then a payment of the interest payable on such
date will be made on the next succeeding day which is a Business Day (and
without any interest or other payment in respect of any such delay), except
that, if such Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day, in each case with the
same force and effect as if made on the date the payment was originally payable.
[INSERT ALTERNATIVE FLOATING PROVISIONS, IF APPLICABLE] A "Business Day" shall
mean any day other than (i) a Saturday or Sunday, or (ii) a day on which banking
institutions in The City of New York are authorized or required by law or
executive order to remain closed. The interest installment so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Junior Indenture, be paid to the Person in whose name this
Security (or one or more Predecessor Securities, as defined in the Junior
Indenture) is registered at the close of business on the Regular Record Date for
such interest installment, which shall be the [INSERT DEFINITION OF REGULAR
RECORD DATES].


                                       16
<PAGE>
Any such interest installment not so punctually paid or duly provided for shall
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Junior Indenture.

     [If applicable, insert "so long as no Event of Default (as defined in the
Junior Indenture) shall have occurred and be continuing, CNAF shall have the
right at any time during the term of this Security, from time to time, to defer
payment of interest on such Security for up to consecutive [MONTHLY] [QUARTERLY]
[SEMI-ANNUAL [ANNUAL] interest payment periods with respect to each deferral
period (each an "Extension Period"), during which Extension Periods CNAF shall
have the right to make partial or no payments of interest on any Interest
Payment Date, and at the end of which CNAF shall pay all interest then accrued
and unpaid (together with Additional Interest thereon to the extent permitted by
applicable law) and any Additional Sums then due; provided that during any such
Extension Period, CNAF shall not, and shall not permit or cause any Subsidiary
of CNAF to, (i) declare or pay any dividends or distributions or redeem,
purchase, acquire or make a liquidation payment with respect to, any of CNAF's
outstanding capital stock (which includes common and preferred stock) or (ii)
make any payment of principal of, or interest or premium, if any, on, or repay,
repurchase or redeem, any debt security of CNAF (including Securities issued by
CNAF pursuant to the Junior Indenture and not represented by this certificate)
that ranks pari passu in all respects with or junior in interest to this
Security or make any guarantee payments with respect to any guarantee by CNAF of
the debt securities of any Subsidiary of CNAF if such guarantee ranks pari passu
in all respects with or junior in interest to this Security (other than
dividends or distributions in Common Stock of CNAF, (b) payments under any CNAF
Guarantee (as defined in the Junior Indenture) and (c) purchases of Common Stock
related to the issuance of Common Stock under any of CNAF's benefit plans for
its directors, officers or employees), and (d) any declaration of a dividend in
connection with the implementation of a stockholders rights plan, or the
issuance of stock under any such plan in the future or the redemption or
repurchase of any such rights pursuant thereto. Prior to the termination of any
Extension Period, CNAF may further extend such Extension Period, provided that
no Extension Period (taking into account all previous and subsequent extensions
within such Extension Period) shall exceed consecutive [MONTHS] [QUARTERS]
[SEMI-ANNUAL] [ANNUAL] periods, end on a date other than an Interest Payment
Date or extend beyond the Maturity of this Security. Upon the termination of any
such Extension Period and upon the payment of all accrued and unpaid interest
and any Additional Interest and Additional Sums then due, CNAF may elect to
begin a new Extension Period, subject to the above requirements. No interest
shall be due and payable during an Extension Period except at the end thereof.
CNAF shall give the Holder of this Security, the Trustee and the Property
Trustee under the relevant Trust Agreement (as defined in the Junior Indenture)
notice of its election to begin any Extension Period at least five Business Days
prior to the earlier of (i) the date Distributions on the Preferred Securities
(as defined in the Junior Indenture) are payable or (ii) the date the
Administrative Trustees are required to give notice to any securities exchange
or other applicable self-regulatory organization or to holders of such Preferred
Securities of the record date or the date such distributions are


                                       17
<PAGE>
payable, but in any event not less than five Business Days (as defined in the
Junior Indenture) prior to such record date.

     Payment of the principal of and interest including Additional Interest on
this Security will be made at the office or agency of CNAF maintained for that
purpose in the United States, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts [IF APPLICABLE, INSERT "; PROVIDED, HOWEVER, THAT AT THE OPTION OF
CNAF PAYMENT OF INTEREST MAY BE MADE (I) BY CHECK MAILED TO THE ADDRESS OF THE
PERSON ENTITLED THERETO AS SUCH ADDRESS SHALL APPEAR IN THE SECURITIES REGISTER
OR (II) BY WIRE TRANSFER IN IMMEDIATELY AVAILABLE FUNDS AT SUCH PLACE AND TO
SUCH ACCOUNT AS MAY BE DESIGNATED BY THE PERSON ENTITLED THERETO AS SPECIFIED IN
THE SECURITIES REGISTER"].

     The indebtedness evidenced by this Security is, to the extent provided in
the Junior Indenture, subordinate and subject in right of payments to the prior
payment in full of all Senior Debt, and this Security is issued subject to the
provisions of the Junior Indenture with respect thereto. Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his behalf to take such
actions as may be necessary or appropriate to effectuate the subordination so
provided and (c) appoints the Trustee his attorney-in-fact for any and all such
purposes. Each Holder hereof, by his acceptance hereof, waives all notice of the
acceptance of the subordination provisions contained herein and in the Junior
Indenture by each holder of Senior Debt, whether now outstanding or hereafter
incurred, and waives reliance by each such holder upon said provisions.

     Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

     Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Junior Indenture or be valid or
obligatory for any purpose.

     IN WITNESS WHEREOF, CNAF has caused this instrument to be duly executed
under its corporate seal.

Dated:                                  CNA Financial Corporation
       ------------------------------


                                        By:
                                            ------------------------------------
                                            [CHAIRMAN AND CHIEF EXECUTIVE
                                            OFFICER, PRESIDENT OR VICE
                                            PRESIDENT]

Attest:


-------------------------------------
[SECRETARY OR ASSISTANT SECRETARY]


                                       18
<PAGE>
     SECTION 2.3. FORM OF REVERSE OF SECURITY.

     This Security is one of a duly authorized issue of debt securities of CNAF
(herein called the "Securities"), issued and to be issued in one or more series
under a Junior Subordinated Indenture, dated as of __________, 20___ (herein
called the "Junior Indenture"), between CNAF and J. P. Morgan Trust Company,
National Association, as trustee (herein called the "Trustee", which term
includes any successor trustee under the Junior Indenture), to which Junior
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Trustee, CNAF and the Holders of the Securities, and of the
terms upon which the Securities are, and are to be, authenticated and delivered.
This Security is one of the series designated on the face hereof, limited in
aggregate principal amount, to the extent provided in the Junior Indenture, to
$__________.

     All terms used in this Security that are defined in the Junior Indenture
and in the Trust Agreement, dated as of ________ __, 20 ____, as amended (the
"Trust Agreement"), for CNA Financial Capital [I][II][III] ("CNA Capital
Trust"), among CNAF, as Depositor, and the Trustees named therein, shall have
the meanings assigned to them in the Junior Indenture or the Trust Agreement, as
the case may be.

     [IF APPLICABLE, INSERT "ON OR AFTER __________, __________, CNAF MAY AT ANY
TIME, AT ITS OPTION, SUBJECT TO THE TERMS AND CONDITIONS OF ARTICLE XI OF THE
JUNIOR INDENTURE, REDEEM THIS SECURITY IN WHOLE AT ANY TIME OR IN PART FROM TIME
TO TIME, AT A REDEMPTION PRICE EQUAL TO [INSERT REDEMPTION PRICE CALCULATION] OF
THE PRINCIPAL AMOUNT THEREOF PLUS THE ACCRUED AND UNPAID INTEREST, INCLUDING
ADDITIONAL INTEREST, IF ANY AND ADDITIONAL SUMS, IF ANY, TO THE DATE FIXED FOR
REDEMPTION."]

     [IF APPLICABLE, INSERT "IF A SPECIAL EVENT IN RESPECT OF CNA CAPITAL TRUST
SHALL OCCUR AND BE CONTINUING, CNAF MAY, AT ITS OPTION, REDEEM THIS SECURITY
WITHIN 90 DAYS OF THE OCCURRENCE OF SUCH SPECIAL EVENT, IN WHOLE BUT NOT IN
PART, SUBJECT TO THE PROVISIONS OF SECTION 11.7 AND THE OTHER PROVISIONS OF
ARTICLE XI OF THE JUNIOR INDENTURE, AT A REDEMPTION PRICE EQUAL TO 100% OF THE
PRINCIPAL AMOUNT THEREOF PLUS ACCRUED AND UNPAID INTEREST, INCLUDING ADDITIONAL
INTEREST, IF ANY, AND ADDITIONAL SUMS, IF ANY, TO THE DATE FIXED FOR
REDEMPTION."]

     [IF APPLICABLE, INSERT "IN THE EVENT OF REDEMPTION OF THIS SECURITY IN PART
ONLY, A NEW SECURITY OR SECURITIES OF THIS SERIES FOR THE UNREDEEMED PORTION
HEREOF WILL BE ISSUED IN THE NAME OF THE HOLDER HEREOF UPON THE CANCELLATION
HEREOF."]

     The Junior Indenture contains provisions for satisfaction, discharge and
defeasance at any time of the entire indebtedness of this Security upon
compliance by CNAF with certain conditions set forth in the Junior Indenture.

     The Junior Indenture permits, with certain exceptions as therein provided,
CNAF and the Trustee at any time to enter into a supplemental indenture or
indentures for the purpose of modifying in any manner the rights and obligations
of CNAF and of the Holders of the Securities, with the consent of the Holders of
not less than a majority in principal amount of the


                                       19
<PAGE>
Outstanding Securities of each series to be affected by such supplemental
indenture. The Junior Indenture also contains provisions permitting Holders of
specified percentages in principal amount of the Securities of each series at
the time Outstanding, on behalf of the Holders of all Securities of such series,
to waive compliance by CNAF with certain provisions of the Junior Indenture and
certain past defaults under the Junior Indenture and their consequences. Any
such consent or waiver by the Holder of this Security shall be conclusive and
binding upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange herefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security.

     [IF THE SECURITY IS NOT A DISCOUNT SECURITY, INSERT "IF AN EVENT OF DEFAULT
WITH RESPECT TO SECURITIES OF THIS SERIES SHALL OCCUR AND BE CONTINUING, THE
PRINCIPAL OF THIS SECURITY MAY, AND, IN CERTAIN, CASES, SHALL, BE ACCELERATED TO
BE DUE AND PAYABLE IN THE MANNER, WITH THE EFFECT AND SUBJECT TO THE CONDITIONS
PROVIDED IN THE JUNIOR INDENTURE."]

     [IF THE SECURITY IS NOT A DISCOUNT SECURITY, INSERT "AS PROVIDED IN AND
SUBJECT TO THE PROVISIONS OF THE JUNIOR INDENTURE, IF AN EVENT OF DEFAULT WITH
RESPECT TO THE SECURITIES OF THIS SERIES AT THE TIME OUTSTANDING OCCURS AND IS
CONTINUING, THEN AND IN EVERY SUCH CASE THE TRUSTEE OR THE HOLDERS OF NOT LESS
THAN 25% IN PRINCIPAL AMOUNT OF THE OUTSTANDING SECURITIES OF THIS SERIES MAY
DECLARE THE PRINCIPAL AMOUNT OF ALL THE SECURITIES OF THIS SERIES TO BE DUE AND
PAYABLE IMMEDIATELY, BY A NOTICE IN WRITING TO CNAF (AND TO THE TRUSTEE IF GIVEN
BY HOLDERS); PROVIDED, HOWEVER, IN THE CASE OF THE SECURITIES OF THIS SERIES AS
TO WHICH A CNA CAPITAL TRUST IS THE REGISTERED HOLDER, THAT IF UPON AN EVENT OF
DEFAULT, THE TRUSTEE OR THE HOLDERS OF NOT LESS THAN 25% IN PRINCIPAL AMOUNT OF
THE OUTSTANDING SECURITIES OF THIS SERIES FAILS TO DECLARE THE PRINCIPAL OF ALL
THE SECURITIES OF THIS SERIES TO BE IMMEDIATELY DUE AND PAYABLE, THE HOLDERS OF
AT LEAST 25% IN AGGREGATE LIQUIDATION AMOUNT OF THE CORRESPONDING SERIES OF
PREFERRED SECURITIES THEN OUTSTANDING SHALL HAVE SUCH RIGHT BY A NOTICE IN
WRITING TO CNAF AND THE TRUSTEE; AND UPON ANY SUCH DECLARATION, THE PRINCIPAL
OF, AND INTEREST (INCLUDING ANY ADDITIONAL INTEREST) ON ALL THE SECURITIES OF
THIS SERIES SHALL BECOME IMMEDIATELY DUE AND PAYABLE, PROVIDED THAT THE PAYMENT
OF THE PRINCIPAL OR AND INTEREST (INCLUDING ANY ADDITIONAL INTEREST) ON SUCH
SECURITIES SHALL REMAIN SUBORDINATED TO THE EXTENT PROVIDED IN ARTICLE THIRTEEN
OF THE JUNIOR INDENTURE."]

     [IF THE SECURITY IS A DISCOUNT SECURITY, INSERT "IF AN EVENT OF DEFAULT
WITH RESPECT TO SECURITIES OF THIS SERIES SHALL OCCUR AND BE CONTINUING, AN
AMOUNT OF PRINCIPAL OF THIS SECURITY MAY BE DECLARED DUE AND PAYABLE IN THE
MANNER, WITH THE EFFECT AND SUBJECT TO THE CONDITIONS PROVIDED IN THE JUNIOR
INDENTURE. SUCH AMOUNT SHALL BE EQUAL TO [INSERT FORMULA FOR DETERMINING THE
AMOUNT]. UPON PAYMENT OF (I) THE AMOUNT OF PRINCIPAL SO DECLARED DUE AND PAYABLE
AND (II) INTEREST ON ANY OVERDUE PRINCIPAL AND OVERDUE INTEREST (IN EACH CASE TO
THE EXTENT THAT THE PAYMENT OF SUCH INTEREST SHALL BE LEGALLY ENFORCEABLE), ALL
OF CNAF'S OBLIGATIONS IN RESPECT OF THE PAYMENT OF THE PRINCIPAL OF AND
INTEREST, IF ANY, ON THIS SECURITY SHALL TERMINATE."]

     [IF THE SECURITY IS A DISCOUNT SECURITY, INSERT "AS PROVIDED IN AND SUBJECT
TO THE PROVISIONS OF THE JUNIOR INDENTURE, IF AN EVENT OF DEFAULT WITH RESPECT
TO THE SECURITIES OF THIS SERIES AT THE TIME OUTSTANDING OCCURS AND IS
CONTINUING, THEN AND IN EVERY SUCH CASE THE TRUSTEE OR THE HOLDERS OF NOT LESS
THAN SUCH PORTION OF THE PRINCIPAL AMOUNT AS MAY BE


                                       20
<PAGE>
SPECIFIED IN THE TERMS OF THIS SERIES OF ALL THE SECURITIES OF THIS SERIES TO BE
DUE AND PAYABLE IMMEDIATELY, BY A NOTICE IN WRITING TO CNAF (AND TO THE TRUSTEE
IF GIVEN BY HOLDERS); PROVIDED, HOWEVER, IN THE CASE OF THE SECURITIES OF THIS
SERIES AS TO WHICH CNA CAPITAL TRUST IS THE REGISTERED HOLDER THAT IF UPON AN
EVENT OF DEFAULT, THE TRUSTEE OR THE HOLDERS OF NOT LESS THAN 25% IN PRINCIPAL
AMOUNT OF THE OUTSTANDING SECURITIES OF THIS SERIES FAILS TO DECLARE THE
PRINCIPAL OF ALL THE SECURITIES OF THIS SERIES TO BE IMMEDIATELY DUE AND
PAYABLE, THE HOLDERS OF AT LEAST 25% IN AGGREGATE LIQUIDATION AMOUNT OF THE
CORRESPONDING SERIES OF PREFERRED SECURITIES THEN OUTSTANDING SHALL HAVE SUCH
RIGHT BY A NOTICE IN WRITING TO CNAF AND THE TRUSTEE. SUCH AMOUNT SHALL BE EQUAL
TO [INSERT FORMULA FOR DETERMINING THE AMOUNT]. UPON ANY SUCH DECLARATION SUCH
SPECIFIED AMOUNT OF AND THE ACCRUED INTEREST (INCLUDING ANY ADDITIONAL INTEREST)
ON ALL THE SECURITIES OF THIS SERIES SHALL BECOME IMMEDIATELY DUE AND PAYABLE,
PROVIDED THAT THE PAYMENT OF PRINCIPAL AND INTEREST (INCLUDING ANY ADDITIONAL
INTEREST) ON SUCH SECURITIES SHALL REMAIN SUBORDINATED TO THE EXTENT PROVIDED IN
ARTICLE THIRTEEN OF THE JUNIOR INDENTURE."] Upon payment (i) of the amount of
principal so declared due and payable and (ii) of interest on any overdue
principal and overdue interest (in each case to the extent that the payment of
such interest shall be legally enforceable), all of CNAF's obligations in
respect of the payment of the principal of and interest, if any, on this
Security shall terminate.

     No reference herein to the Junior Indenture and no provision of this
Security or of the Junior Indenture shall alter or impair the obligation of
CNAF, which is absolute and unconditional, to pay the principal of and interest
including Additional Interest on this Security at the times, place and rate, and
in the coin or currency, herein prescribed.

     The Securities of this series are issuable only in registered form without
coupons in denominations of $__________ and any integral multiple thereof. As
provided in the Junior Indenture and subject to certain limitations herein and
therein set forth, the transfer of this Security is registrable in the
Securities Register, upon surrender of this Security for registration of
transfer at the office or agency of CNAF maintained under Section 10.2 of the
Junior Indenture duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to CNAF and the Securities Registrar duly executed
by, the Holder hereof or his attorney duly authorized in writing, and thereupon
one or more new Securities of this series, of authorized denominations and for
the same aggregate principal amount, will be issued to the designated transferee
or transferees. No service charge shall be made for any such registration of
transfer or exchange, but CNAF may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.

     Prior to due presentment of this Security for registration of transfer,
CNAF, the Trustee and any agent of CNAF or the Trustee may treat the Person in
whose name this Security is registered as the owner hereof for all purposes,
whether or not this Security be overdue, and neither CNAF, the Trustee nor any
such agent shall be affected by notice to the contrary.

     As provided in the Junior Indenture and subject to certain limitations
herein and therein set forth, Securities of this series are exchangeable for a
like aggregate principal amount of Securities of such series of a different
authorized denomination, as requested by the Holder surrendering the same.


                                       21
<PAGE>
     CNAF and, by its acceptance of this Security or a beneficial interest
therein, the Holder of, and any Person that acquires a beneficial interest in,
this Security agree that for United States Federal, state and local tax purposes
it is intended that this Security constitute indebtedness.

     THE JUNIOR INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES THEREOF.

     SECTION 2.4. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION. Subject to
Section [6.11], the Trustee's certificate of authentication shall be in
substantially the following form:

     This is one of the Securities referred to in the within-mentioned Junior
Indenture.

                                        __________, as Trustee


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

                                  ARTICLE III.
                                 THE SECURITIES

     SECTION 3.1. TITLE AND TERMS.

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

     The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution, and set forth in an Officers'
Certificate (such Officers' Certificate shall have the effect of a supplemental
indenture for all purposes hereunder), or established in one or more indentures
supplemental hereto, prior to the issuance of Securities of a series:

     (a) the title of the securities of such series, which shall distinguish the
Securities of the series from all other Securities;

     (b) the limit, if any, upon the aggregate principal amount of the
Securities of such series which may be authenticated and delivered under this
Junior Indenture (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other Securities
of the series pursuant to Section 3.4, 3.5, 3.6, 9.6 or 11.6).

     (c) the Stated Maturity or Maturities on which the principal of the
Securities of such series is payable or the method of determination thereof;

     (d) the Interest Rate or Interest Rates, if any, at which the Securities of
such series shall bear interest, if any, the rate or rates and extent to which
Additional Interest, if any, shall be payable in respect of any Securities of
such series, the Interest Payment Dates on which such


                                       22
<PAGE>
interest shall be payable, the right, pursuant to Section 3.11 or as otherwise
set forth therein, of CNAF to defer or extend an Interest Payment Date, and the
Regular Record Date for the interest payable on any Interest Payment Date, or
the method by which any of the foregoing shall be determined;

     (e) the place or places where the principal of and interest including
Additional Interest on the Securities of such series shall be payable, the place
or places where the Securities of such series may be presented for registration
of transfer or exchange, and the place or places where notices and demands to or
upon CNAF in respect of the Securities of such series may be made;

     (f) the period or periods within or the date or dates on which, if any, the
price or prices at which and the terms and conditions upon which the Securities
of such series may be redeemed, in whole or in part, at the option of CNAF, if
CNAF is to have the option;

     (g) the obligation or the right, if any, of CNAF to redeem (if other than
in accordance with Section 11.7 hereof), repay or purchase the Securities of
such series pursuant to any sinking fund, amortization or analogous provisions,
or at the option of a Holder thereof, and the period or periods within or the
date or date on which, the price or prices at which, the currency or currencies
(including currency unit or units) in which and the other terms and conditions
upon which Securities of the series shall be redeemed, repaid or purchased, in
whole or in part, pursuant to such obligation;

     (h) the denominations in which any Securities of such series shall be
issuable, if other than denominations of $25 and any integral multiple thereof;

     (i) if other than Dollars, the Foreign Currency in which the principal of
and interest including Additional Interest, if any, on the Securities of the
series shall be payable, or in which the Securities of the series shall be
denominated;

     (j) the additions, modifications or deletions, if any, in the Events of
Default or covenants of CNAF set forth herein with respect to the Securities of
such series;

     (k) if other than the principal amount thereof, the portion of the
principal amount of Securities of such series that shall be payable upon
declaration of acceleration of the Maturity thereof;

     (l) the additions or changes, if any, to this Junior Indenture with respect
to the Securities of such series as shall be necessary to permit or facilitate
the issuance of the Securities of such series in bearer form, registrable or not
registrable as to principal, and with or without interest coupons;

     (m) any index or indices used to determine the amount of payments of
principal on the Securities of such series or the manner in which such amounts
will be determined;

     (n) whether the Securities of the series, or any portion thereof, shall
initially be issuable in the form of a temporary Global Security representing
all or such portion of the


                                       23
<PAGE>
Securities of such series and the provisions for the exchange of such temporary
Global Security for definitive Securities of such series;

     (o) whether the Securities of the series, or any portion thereof, shall be
issued in whole or in part in the form of one or more Global Securities and, in
such case, the Depository for such Global Securities (which Depository shall be
a clearing agency registered under the Securities Exchange Act of 1934, as
amended), in the form of any legend or legends which shall be borne by any such
Global Security in addition to or in lieu of that set forth in Section 2.4 and
any circumstances in addition to or in lieu of those set forth in Section 3.5 in
which any such Global Security may be exchanged in whole or in part for
Securities registered, and any transfer of such Global Security in whole or in
part may be registered, in the name or names of Persons other than the
Depository for such Global Security or a nominee thereof; and

     (p) the appointment of any Paying Agent or Agents for the Securities of
such series;

     (q) the terms of any right to convert or exchange Securities of such series
into any other securities or property of CNAF, and the additions or changes, if
any, to this Junior Indenture with respect to the Securities of such series to
permit or facilitate such conversion or exchange;

     (r) the form or forms of the Trust Agreement, Second Amended and Restated
Trust Agreement and Guarantee Agreement, if different from the forms attached
hereto as Annexes A, B and C, respectively;

     (s) the relative degree, if any, to which the Securities of such series
shall be senior to or be subordinated to other series of Securities in right of
payment, whether such other series of Securities are Outstanding or not; and

     (t) any other terms of the Securities of such series (which terms shall not
be inconsistent with the provisions of this Junior Indenture or the requirements
of the Trust Indenture Act).

     All Securities of any one series shall be substantially identical except as
to denomination and except as may otherwise be provided herein or in or pursuant
to such Board Resolution and set forth in such Officers' Certificate or in any
such indenture supplemental hereto.

     If any of the terms of the series are established by action taken pursuant
to a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of CNAF and delivered to
the Trustee at or prior to the delivery of the Officers' Certificate setting
forth the terms of the series.

     SECTION 3.2. DENOMINATIONS.

     The Securities of each series shall be in registered form without coupons
and shall be issuable in denominations of $25 and any integral multiple thereof,
unless otherwise specified as contemplated by Section 3.1.


                                       24
<PAGE>
     SECTION 3.3. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.

     The Securities shall be executed on behalf of CNAF by its Chief Executive
Officer, President or one of its Senior Vice Presidents or Group Vice Presidents
under its corporate seal reproduced or impressed thereon and attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile signatures of the present
or any future so authorized officer and may be imprinted or otherwise produced
upon the Securities.

     Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of CNAF shall bind CNAF, notwithstanding
that such individuals or any of them have ceased to hold such offices prior to
the authentication and delivery of such Securities or did not hold such offices
at the date of such Securities. At any time and from time to time after the
execution and delivery of this Junior Indenture, CNAF may deliver Securities
executed by CNAF to the Trustee for authentication. Securities may be
authenticated on original issuance from time to time and delivered pursuant to
such procedures acceptable to the Trustee ("Procedures") as may be specified
from time to time by CNAF Order. Procedures may authorize authentication and
delivery pursuant to oral instructions of CNAF or a duly authorized agent, which
instructions shall be promptly confirmed in writing.

     Prior to the initial delivery of a series of Securities to the Trustee for
authentication, CNAF shall deliver to the Trustee the following:

     (a) A CNAF Order requesting the Trustee's authentication and delivery of
all or a portion of the Securities of such series, and if less than all, setting
forth procedures for such authentication;

     (b) The Board Resolution by or pursuant to which such form of Security has
been approved, and the Board Resolution, if any, by or pursuant to which the
terms of the Securities of such series have been approved, and, if pursuant to a
Board Resolution, an Officers' Certificate describing the action taken;

     (c) An Officers' Certificate dated the date such certificate is delivered
to the Trustee, stating that all conditions precedent provided for in this
Junior Indenture relating to the authentication and delivery of Securities in
such form and with such terms have been complied with; and

     (d) An Opinion of Counsel stating that (i) the form of such Securities has
been duly authorized and approved in conformity with the provisions of this
Junior Indenture; (ii) the terms of such Securities have been duly authorized
and determined in conformity with the provisions of this Junior Indenture, or,
if such terms are to be determined pursuant to Procedures, when so determined
such terms shall have been duly authorized and determined in conformity with the
provisions of this Junior Indenture; and (iii) Securities in such form when
completed by appropriate insertions and executed and delivered by CNAF to the
Trustee for authentication in accordance with this Junior Indenture,
authenticated and delivered by the Trustee in accordance with this Junior
Indenture within the authorization as to aggregate principal amount established
from time to time by the Board of Directors and sold in the manner specified in
such Opinion of


                                       25
<PAGE>
Counsel, will be the legal, valid and binding obligations of CNAF entitled to
the benefits of this Junior Indenture, subject to applicable bankruptcy,
reorganization, insolvency and similar laws generally affecting creditors'
rights, to general equitable principles and except as enforcement thereof may be
limited by (A) requirements that a claim with respect to any Securities
denominated other than in Dollars (or a Foreign Currency judgment in respect of
such claim) be converted into Dollars at a rate of exchange prevailing on a date
determined pursuant to applicable law or (B) governmental authority to limit,
delay or prohibit the making of payments in Foreign Currencies or payments
outside the United States, and subject to such other qualifications as such
counsel shall conclude do not materially affect the rights of Holders of such
Securities; provided, however, that the Trustee shall be entitled to receive the
documents referred to in Clauses (b), (c) and (d) above only at or prior to the
first request of CNAF to the Trustee to authenticate Securities of such series.

     Each Security shall be dated the date of its authentication.

     No Security shall be entitled to any benefit under this Junior Indenture or
be valid or obligatory for any purpose, unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by the manual signature of one of its authorized
officers, and such certificate upon any Security shall be conclusive evidence,
and the only evidence, that such Security has been duly authenticated and
delivered hereunder. Notwithstanding the foregoing, if any Security shall have
been authenticated and delivered hereunder but never issued and sold by CNAF,
and CNAF shall deliver such Security to the Trustee for cancellation as provided
in Section 3.9, for all purposes of this Junior Indenture such Security shall be
deemed never to have been authenticated and delivered hereunder and shall never
be entitled to the benefits of this Junior Indenture.

     SECTION 3.4. TEMPORARY SECURITIES.

     Pending the preparation of definitive Securities of any series, CNAF may
execute, and upon CNAF Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities of such series in lieu of which they are
issued and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Securities may determine, as
conclusively evidenced by their execution of such Securities.

     If temporary Securities of any series are issued, CNAF will cause
definitive Securities of such series to be prepared without unreasonable delay.
After the preparation of definitive Securities, the temporary Securities shall
be exchangeable for definitive Securities upon surrender of the temporary
Securities at the office or agency of CNAF designated for that purpose without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities, CNAF shall execute and the Trustee shall authenticate and
deliver in exchange therefor a like principal amount of definitive Securities of
the same series of authorized denominations having the same Original Issue Date
and Stated Maturity and having the same terms as such temporary Securities.
Until so exchanged, the temporary Securities of any series shall in all respects
be entitled to the same benefits under this Junior Indenture as definitive
Securities of such series.


                                       26
<PAGE>
     SECTION 3.5. REGISTRATION, TRANSFER AND EXCHANGE.

     CNAF shall cause to be kept at the Corporate Trust Office of the Trustee a
register in which, subject to such reasonable regulations as it may prescribe,
CNAF shall provide for the registration of Securities and of transfers of
Securities. Such register is herein sometimes referred to as the "Securities
Register." The Trustee is hereby appointed "Securities Registrar" for the
purpose of registering Securities and transfers of Securities as herein
provided.

     Upon surrender for registration of transfer of any Security at the office
or agency of CNAF designated for that purpose CNAF shall execute, and the
Trustee shall authenticate and deliver, in the name of the designated transferee
or transferees, one or more new Securities of the same series of any authorized
denominations, of a like aggregate principal amount, of the same Original Issue
Date and Stated Maturity and having the same terms.

     At the option of the Holder, Securities may be exchanged for other
Securities of the same series of any authorized denominations, of a like
aggregate principal amount, of the same Original Issue Date and Stated Maturity
and having the same terms, upon surrender of the Securities to be exchanged at
such office or agency. Whenever any securities are so surrendered for exchange,
CNAF shall execute, and the Trustee shall authenticate and deliver, the
Securities which the Holder making the exchange is entitled to receive.

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

     Every Security presented or surrendered for transfer or exchange shall (if
so required by CNAF or the Securities Registrar) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to CNAF and
the Securities Registrar, duly executed by the Holder thereof or his attorney
duly authorized in writing.

     No service charge shall be made to a Holder for any transfer or exchange of
Securities, but CNAF may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any transfer or
exchange of Securities other than exchanges pursuant to Section 3.6 not
involving any transfer.

     Neither CNAF nor the Trustee shall be required, pursuant to the provisions
of this Section, (a) to issue, transfer or exchange any Security of any series
during a period beginning at the opening of business 15 days before the day of
selection for redemption of Securities pursuant to Article XI and ending at the
close of business on the day of mailing of notice of redemption or (b) to
transfer or exchange any Security so selected for redemption in whole or in
part, except, in the case of any Security to be redeemed in part, any portion
thereof not to be redeemed.

     The provisions of Clauses (1), (2), (3) and (4) below shall apply only to
Global Securities:

     (1) Each Global Security authenticated under this Junior Indenture shall be
registered in the name of the Depository designated for such Global Security or
a nominee thereof and


                                       27
<PAGE>
delivered to such Depository or a nominee thereof or custodian therefor, and
each such Global Security shall constitute a single Security for all purposes of
this Junior Indenture.

     (2) Notwithstanding any other provision in this Junior Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in the name
of any Person other than the Depository for such Global Security or a nominee
thereof unless (A) such Depository (i) has notified CNAF that it is unwilling or
unable to continue as Depository for such Global Security or (ii) has ceased to
be a clearing agency registered under the Exchange Act at a time when the
Depository is required to be so registered to act as depository, in each case
unless CNAF has approved a successor Depository within 60 days, (B) there shall
have occurred and be continuing an Event of Default with respect to such Global
Security, or (C) CNAF in its sole discretion determines that such Global
Security will be so exchangeable and delivers to the Trustee a CNAF Order that
such Global Security shall be so exchangeable. Any Global Security that is
exchangeable pursuant to the preceding sentence shall be exchanged, without
unnecessary delay but in no event later that the earliest date on which such
Global Security shall be exchangeable, for Securities registered in such names
as such Depository shall direct.

     Notwithstanding any other provision in this Junior Indenture, a Global
Security may not be transferred except as a whole by the Depository with respect
to such Global Security to a nominee of such Depositary, or by a nominee of such
Depositary to such Depositary or another nominee of such Depository.

     (3) Any Global Security that is exchangeable pursuant hereto shall be
exchanged without unnecessary delay but in no event later than the earliest date
on which such Global Security shall be exchangeable, for any Securities
registered in such names as such Depository shall direct. If a Security is
issued in exchange for any portion of a Global Security after the close of
business at the office or agency for such Security where such exchange occurs on
or after (i) any Regular Record Date for such Security and before the opening of
business at such office or agency on the next Interest Payment Date, or (ii) any
Special Record Date for such Security and before the opening of business at such
office or agency on the related proposed date for payment of interest or
Defaulted Interest, as the case may be, interest shall not be payable on such
Interest Payment Date or proposed date for payment, as the case may be, in
respect of such Security, but shall be payable on such Interest Payment Date or
proposed date for payment, as the case may be, only to the Person to whom
interest in respect of such portion of such Global Security shall be payable in
accordance with the provisions of this Junior Indenture.

     (4) Every Security authenticated and delivered upon registration or
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Section, Section 3.4, 3.6, 9.6 or 11.6 or
otherwise, shall be authenticated and delivered in the form of, and shall be, a
Global Security, unless such Security is registered in the name of a Person
other than the Depository for such Global Security or a nominee thereof.


                                       28
<PAGE>
     SECTION 3.6. MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.

     If any mutilated Security is surrendered to the Trustee together with such
reasonable security or indemnity as may be required by CNAF or the Trustee to
save each of them harmless, CNAF shall execute, and the Trustee shall
authenticate and deliver, in exchange therefor a new Security of the same series
of like tenor and principal amount, having the same Original Issue Date and
Stated Maturity and other terms as such mutilated Security, and bearing a number
not contemporaneously outstanding.

     If there shall be delivered to CNAF and to the Trustee (i) evidence to
their reasonable satisfaction of the destruction, loss or theft of any Security,
and (ii) such security or indemnity as may be reasonably required by them to
save each of them harmless, then, in the absence of notice to CNAF or the
Trustee that such Security has been acquired by a bona fide purchaser, CNAF
shall execute, and the Trustee shall authenticate and deliver, in lieu of any
such destroyed, lost or stolen Security, a new Security of the same series of
like tenor and principal amount, having the same Original Issue Date and Stated
Maturity and other terms as such destroyed, lost or stolen Security, and bearing
a number not contemporaneously outstanding.

     Notwithstanding the provisions the previous paragraphs, in case any such
mutilated, destroyed, lost or stolen Security has become or is about to become
due and payable, CNAF in its discretion may, instead of issuing a new Security,
pay such Security.

     Upon the issuance of any new Security under this Section, CNAF may require
the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto and any other expenses (including the
fees and expenses of the Trustee) connected therewith.

     Every new Security issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of CNAF, whether or not the destroyed, lost or stolen
Security shall be at any time enforceable by anyone, and shall be entitled to
all the benefits of this Junior Indenture equally and proportionately with any
and all other Securities duly issued hereunder.

     The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.

     SECTION 3.7. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.

     Except as otherwise specified with respect to a series of Securities in
accordance with the provisions of Section 3.1, interest on any Security of any
series which is payable, and is punctually paid or duly provided for, on any
Interest Payment Date, shall be paid to the Person in whose name that Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest in respect of Securities of such
series. The initial payment of interest on any Security of any series which is
issued between a Regular Record Date and the related Interest Payment Date shall
be payable as provided in such Security or in the Board Resolution pursuant to
Section 3.1 with respect to the related series of Securities.


                                       29
<PAGE>
     Except as otherwise specified with respect to a series of Securities in
accordance with the provisions of Section 3.1, any interest on any Security
which is payable, but is not timely paid or duly provided for, on any Interest
Payment Date for Securities of such series (herein called "Defaulted Interest")
shall forthwith cease to be payable to the Holder on the relevant Regular Record
Date by virtue of having been such Holder, and such Defaulted Interest may be
paid by CNAF, at its election in each case, as provided in Clause (a) or (b)
below:

     (a) CNAF may elect to make payment of any Defaulted Interest to the Persons
in whose names the Securities of such series in respect of which interest is in
default (or their respective Predecessor Securities) are registered at the close
of business on a Special Record Date for the payment of such Defaulted Interest,
which shall be fixed in the following manner. CNAF shall notify the Trustee in
writing of the amount of Defaulted Interest proposed to be paid on each Security
and the date of the proposed payment, and at the same time CNAF shall deposit
with the Trustee an amount of money in the currency in which the Securities of
such series are payable (except as otherwise specified pursuant to Section 3.1
for the Securities of such series) equal to the aggregate amount proposed to be
paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the proposed
payment, such money when deposited to be held in trust for the benefit of the
Persons entitled to such Defaulted Interest as in this Clause provided.
Thereupon the Trustee shall fix a Special Record Date for the payment of such
Defaulted Interest which shall be not more than 15 days and not less than 10
days prior to the date of the proposed payment and not less than 10 days after
the receipt by the Trustee of the notice of the proposed payment. The Trustee
shall promptly notify CNAF of such Special Record Date and, in the name and at
the expense of CNAF, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be mailed, first
class, postage prepaid, to each Holder of a Security of such series at the
address of such Holder as it appears in the Securities Register not less than 10
days prior to such Special Record Date. The Trustee may, in its discretion, in
the name and at the expense of CNAF, cause a similar notice to be published at
least once in a newspaper, customarily published in the English language on each
Business Day and of general circulation in the Borough of Manhattan, The City of
New York, but such publication shall not be a condition precedent to the
establishment of such Special Record Date. Notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor having been mailed
as aforesaid, such Defaulted Interest shall be paid to the Persons in whose
names the Securities of such series (or their respective Predecessor Securities)
are registered on such Special Record Date and shall no longer be payable
pursuant to the following Clause (b).

     (b) CNAF may make payment of any Defaulted Interest in any other lawful
manner not inconsistent with the requirements of any securities exchange on
which the Securities of the series in respect of which interest is in default
may be listed and, upon such notice as may be required by such exchange (or by
the Trustee if the Securities are not listed), if, after notice given by CNAF to
the Trustee of the proposed payment pursuant to this Clause, such payment shall
be deemed practicable by the Trustee.

     Subject to the foregoing provisions of this Section 3.7 and Section 3.5,
each Security delivered under this Junior Indenture upon transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.


                                       30
<PAGE>
     SECTION 3.8. PERSONS DEEMED OWNERS.

     Prior to due presentment of a Security for registration of transfer, CNAF,
the Trustee and any agent of CNAF or the Trustee may treat the Person in whose
name any Security is registered as the owner of such Security for the purpose of
receiving payment of principal of and (subject to Sections 3.5 and 3.7) interest
on such Security and for all other purposes whatsoever, whether or not such
Security be overdue, and none of CNAF, the Trustee or any agent of CNAF or the
Trustee shall be affected by notice to the contrary.

     SECTION 3.9. CANCELLATION.

     All Securities surrendered for payment, redemption, transfer or exchange
shall, if surrendered to any Person other than the Trustee, be delivered to the
Trustee, and any such Securities and Securities surrendered directly to the
Trustee for any such purpose shall be promptly canceled by it. CNAF may at any
time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which CNAF may have acquired in any manner
whatsoever, and all Securities so delivered shall be promptly canceled by the
Trustee. If the Company shall so acquire any of the Securities, however, such
acquisition shall not operate as a redemption or satisfaction of the
indebtedness represented by such Securities unless and until the same are
surrendered to the Trustee for cancellation. No Securities shall be
authenticated in lieu of or in exchange for any Securities canceled as provided
in this Section, except as expressly permitted by this Junior Indenture. All
canceled Securities shall be destroyed by the Trustee and the Trustee shall
deliver to CNAF a certificate of such destruction.

     SECTION 3.10. COMPUTATION OF INTEREST.

     Except as otherwise specified as contemplated by Section 3.1 for Securities
of any series, interest on the Securities of each series for any period shall be
computed on the basis of a 360-day year of twelve 30-day months.

     SECTION 3.11. DEFERRALS OF INTEREST PAYMENT DATES.

     If specified as contemplated by Section 2.1 or Section 3.1 with respect to
the Securities of a particular series, so long as no Event of Default has
occurred and is continuing, CNAF shall have the right, at any time during the
term of such Securities, from time to time to defer the payment of interest on
such Securities for such period or periods as may be specified as contemplated
by Section 3.1 (each, an "Extension Period") during which Extension Periods CNAF
shall have the right to make partial or no payments of interest on any Interest
Payment Date. At the end of any such Extension Period, CNAF shall pay all
interest then accrued and unpaid on the Securities (together with Additional
Interest thereon, if any, at the rate specified for the Securities of such
series to the extent permitted by applicable law) and any Additional Sums then
due provided, however, that during any such Extension Period, CNAF shall not,
and shall not cause or permit any Subsidiary to, (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of CNAF's outstanding capital stock
(which includes common and preferred stock), or (ii) make any payment of
principal of, or interest or premium, if any, on or repay, repurchase or redeem
any debt security of CNAF (including other series of Securities issued by CNAF
pursuant to the


                                       31
<PAGE>
Junior Indenture) that ranks pari passu in all respects with or junior in
interest to the Securities of such series or make any guarantee payments with
respect to any guarantee by CNAF of the debt securities of any Subsidiary of
CNAF if such guarantee ranks pari passu in all respects with or junior in
interest to the Securities of such series (other than (a) dividends or
distributions in Common Stock of CNAF, (b) payments under any CNAF Guarantee (as
defined in the Junior Indenture) (c) purchases of Common Stock related to the
issuance of Common Stock under any of CNAF's benefit plans for its directors,
officers or employees and (d) any declaration of a dividend in connection with
the implementation of stockholder's rights plan, or the issuance of stock under
any such plan in the future or a redemption or repurchase of any such rights
pursuant thereto). Prior to the termination of any Extension Period, CNAF may
further extend such Extension Period, provided that no Extension Period (taking
into account all previous and subsequent extensions within such Extension
Period) shall exceed the maximum consecutive period or periods specified in such
Securities, end on a date other than an Interest Payment Date or extend beyond
the Maturity of such Securities. Upon termination of any Extension Period and
upon the payment of all accrued and unpaid interest and any Additional Interest
and Additional Sums then due on any Interest Payment Date, CNAF may elect to
begin a new Extension Period, subject to the above requirements. No interest
shall be due and payable during an Extension Period, except at the end thereof.
CNAF shall give the Holders of the Securities of such series, the Trustee and
the Property Trustee under the relevant Trust Agreement notice of its election
to begin any such Extension Period at least five Business Days prior to the
earlier of (i) the date the distributions on the Preferred Securities of the
applicable CNA Capital Trust are payable or (ii) the date the Administrative
Trustees of such CNA Capital Trust are required to give notice to any securities
exchange or other applicable self-regulatory organization or to holders of such
Preferred Securities of the record date or the date such Distributions are
payable, but in any event not less than five Business Days prior to such record
date.

     The Trustee shall promptly give notice of CNAF's election to begin any such
Extension Period to the Holders of the outstanding Securities of such series.

     SECTION 3.12. RIGHT OF SET-OFF.

     With respect to the Securities of a series issued to a CNA Capital Trust,
notwithstanding anything to the contrary in this Junior Indenture, CNAF shall
have the right to set-off any payment it is otherwise required to make in
respect of any such Security to the extent CNAF has theretofore made, or is
concurrently on the date of such payment making, an unreimbursed payment under
the CNAF Guarantee relating to such Security or under Section 5.8 of the Junior
Indenture.

     SECTION 3.13. AGREED TAX TREATMENT.

     Each Security issued hereunder shall provide that CNAF and, by its
acceptance of a Security or a beneficial interest therein, the Holder of, and
any Person that acquires a beneficial interest in, such Security agree that for
United States Federal, state and local tax purposes it is intended that such
Security constitute indebtedness.


                                       32
<PAGE>
     SECTION 3.14. EXTENSION OF STATED MATURITY; ADJUSTMENT OF STATED MATURITY
UPON AN EXCHANGE.

     If specified as contemplated by Section 2.1 or Section 3.1 with respect to
the Securities of a particular series, CNAF shall have the right to (a) change
the Maturity of the Securities of such series upon the liquidation of a CNA
Capital Trust and the exchange of such Securities for the Preferred Securities
of such CNA Capital Trust and (b) extend the Maturity for the Securities of such
series; provided, that, if CNAF exercises its right to liquidate the applicable
CNA Capital Trust and exchange the Securities of a particular series for the
Preferred Securities of such CNA Capital Trust as specified in clause (a) above,
any changed Maturity of the Securities of such series shall be no earlier than
the date that is five years after the issuance of such Preferred Securities and
no later than the date 30 years (plus an extended term of up to an additional 19
years if the above-referenced conditions are satisfied) after the date of the
initial issuance of such Preferred Securities; provided further, that at time
any election to extend the Maturity Date is made and at the time of such
extension, (i) CNAF is not in bankruptcy, otherwise insolvent or in liquidation,
(ii) CNAF is not in default in the payment of any interest or principal on the
Securities of such series and no deferred interest payments thereon have
accrued, (iii) the applicable CNA Capital Trust is not in arrears on payments of
distributions on its Preferred Securities and no deferred distributions thereon
are accumulated, (iv) the Securities are rated not less than BBB- by Standard &
Poor's Ratings Services or Baa3 by Moody's Investors Service, Inc. or the
equivalent by any other nationally recognized statistical rating organization
and (v) the extended Maturity is no later than the 49th anniversary of the
initial issuance of the Preferred Securities of the applicable CNA Capital
Trust. In the event CNAF elects to change or extend the Stated Maturity as
herein provided, it shall give notice to the Trustee, and the Trustee shall give
notice of such change or extension to the Holders no less than 30 and no more
than 60 days prior to the effectiveness thereof.

     SECTION 3.15. CUSIP NUMBERS.

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

                                   ARTICLE IV.
                           SATISFACTION AND DISCHARGE

     SECTION 4.1. SATISFACTION AND DISCHARGE OF JUNIOR INDENTURE.

     This Junior Indenture shall, upon a CNAF order, cease to be of further
effect with respect to any series of Securities specified in a CNAF order
(except as to (i) any surviving rights of transfer, substitution, conversion and
exchange of Securities, (ii) rights of Holders to receive


                                       33
<PAGE>
payments of principal of and interest including Additional Interest on the
Securities and other rights, duties and obligations of the Holders as
beneficiaries hereof with respect to the amounts, if any, deposited with the
Trustee pursuant to this Article IV and (iii) the rights and obligations of the
Trustee hereunder), and the Trustee, at the expense of CNAF, shall execute
proper instruments acknowledging satisfaction and discharge of this Junior
Indenture, when

     (a) either

          (i) all Securities theretofore authenticated and delivered (other than
(A) Securities which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 3.6 and (B) Securities for whose payment
money has theretofore been deposited in trust or segregated and held in trust by
CNAF and thereafter repaid to CNAF or discharged from such trust, as provided in
Section 10.3) have been delivered to the Trustee for cancellation; or

          (ii) all such Securities not theretofore delivered to the Trustee for
cancellation

               (A) have become due and payable, or

               (B) will become due and payable at their Stated Maturity within
     one year of the date of deposit, or

               (C) are to be called for redemption within one year under
     arrangements satisfactory to the Trustee for the giving of notice of
     redemption by the Trustee in the name, and at the expense, of CNAF and
     CNAF, in the case of Clause (ii) (A), (ii) (B) or (ii) (C) above, has
     deposited or caused to be deposited with the Trustee as trust funds in
     trust for such purpose an amount in the currency or currencies in which the
     Securities of such series are payable sufficient to pay and discharge the
     entire indebtedness on such Securities not theretofore delivered to the
     Trustee for cancellation, including principal (and premium, if any) and
     interest (including any Additional Interest) to the date of such deposit
     (in the case of Securities which have become due and payable) or to the
     Stated Maturity or Redemption Date, as the case may be;

     (b) CNAF has paid or caused to be paid all other sums payable hereunder by
CNAF; and

     (c) CNAF has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel each stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of this Junior Indenture have
been complied with.

Notwithstanding the satisfaction and discharge of this Junior Indenture, the
obligations of CNAF to the Trustee under Section 6.7 and, if money shall have
been deposited with the Trustee pursuant to subclause (ii) of clause (a) of this
Section, the obligations of the Trustee under Section 4.2 and the last paragraph
of Section 10.3 shall survive.


                                       34
<PAGE>
     SECTION 4.2. APPLICATION OF TRUST FUNDS.

     Subject to the provisions of the last paragraph of Section 10.3, all money
deposited with the Trustee pursuant to Section 4.1 or money or Government
Obligations deposited with the Trustee pursuant to Section 4.3, or received by
the Trustee in respect of Government Obligations deposited with the Trustee
pursuant to Section 4.3, shall be held in trust and applied by the Trustee, in
accordance with the provisions of the Securities and this Junior Indenture, to
the payment, either directly or through any Paying Agent (including CNAF acting
as its own Paying Agent) as the Trustee may determine, to the Persons entitled
thereto, of the principal and interest or other amounts for the payment of which
such money or obligations have been deposited with or received by the Trustee;
provided, however, such moneys need not be segregated from other funds except to
the extent required by law.

     SECTION 4.3. SATISFACTION, DISCHARGE AND DEFEASANCE OF SECURITIES OF ANY
SERIES.

     To the extent provided in, and subject to any limitations set forth
pursuant to, a Board Resolution adopted pursuant to Section 3.1 establishing the
terms of the Securities of any series, CNAF shall be deemed to have paid and
discharged the entire indebtedness on all the Outstanding Securities of any such
series and the Trustee, at the expense of CNAF, shall execute proper instruments
acknowledging satisfaction and discharge of such indebtedness, when

     (a) with respect to all Outstanding Securities of such series,

          (i) CNAF has irrevocably deposited or caused to be irrevocably
deposited with the Trustee as trust funds in trust for such purpose an amount
sufficient to pay and discharge the entire indebtedness on all Outstanding
Securities of such series for principal (and premium, if any) and interest
(including any Additional Interest) to the Stated Maturity or any Redemption
Date as contemplated by the penultimate paragraph of this Section 4.3, as the
case may be; or

          (ii) CNAF has irrevocably deposited or caused to be irrevocably
deposited with the Trustee as obligations in trust for such purpose an amount of
Government Obligations as will, in the written opinion of independent public
accountants delivered to the Trustee, together with predetermined and certain
income to accrue thereon, without consideration of any reinvestment thereof, be
sufficient to pay and discharge when due the entire indebtedness on all
Outstanding Securities of such series for principal (and premium, if any) and
interest (including any Additional Interest) to the Stated Maturity or any
Redemption Date as contemplated by the penultimate paragraph of this Section
4.3, as the case may be; and

     (b) CNAF has paid or caused to be paid all other sums payable with respect
to the Outstanding Securities of such series; and

     (c) CNAF has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of the entire indebtedness on all
Outstanding Securities of any such series have been complied with.


                                       35
<PAGE>
     Any deposits with the Trustee referred to in Section 4.3(a) above shall be
irrevocable and shall be made under the terms of an escrow trust agreement in
form and substance reasonably satisfactory to the Trustee. If any Outstanding
Securities of such series are to be redeemed prior to their Stated Maturity,
whether pursuant to any optional redemption provisions or in accordance with any
mandatory sinking fund requirement, the applicable escrow trust agreement shall
provide therefor and CNAF shall make such arrangements as are satisfactory to
the Trustee for the giving of notice of redemption by the Trustee in the name,
and at the expense, of CNAF. If the Securities of such series are not to become
due and payable at their Stated Maturity or upon call for redemption within one
year of the date of deposit, then CNAF shall give, not later than the date of
such deposit, notice of such deposit to the Holders of Securities of such
series.

     Upon the satisfaction of the conditions set forth in this Section 4.3 with
respect to all the Outstanding Securities of any series, the terms and
conditions of such series, including the terms and conditions with respect
thereto set forth in this Junior Indenture, shall no longer be binding upon, or
applicable to, CNAF; provided, that CNAF shall not be discharged from any
payment obligations in respect of Securities of such series which are deemed not
to be Outstanding under clause (iii) of the definition thereof if such
obligations continue to be valid obligations of CNAF under applicable law.

                                   ARTICLE V.
                                    REMEDIES

     SECTION 5.1. EVENTS OF DEFAULT.

     "Event of Default", wherever used herein with respect to the Securities of
any series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):

     (a) default in the payment of any interest upon any Security of that
series, including any Additional Interest in respect thereof, when it becomes
due and payable, and continuance of such default for a period of 30 days
(subject to the deferral of any due date in the case of an Extension Period); or

     (b) default in the payment of (i) the principal of any Security of that
series at its stated Maturity, upon redemption by declaration or otherwise or
(ii) any sinking fund payment when and as due by the terms of any Security of
that series; or

     (c) default in the performance, or breach, in any material respect, of any
covenant or warranty of CNAF in this Junior Indenture applicable to any Security
of that series (other than a covenant or warranty a default in the performance
of which or the breach of which is elsewhere in this Section specifically dealt
with), and continuance of such default or breach for a period of 90 days after
there has been given, by registered or certified mail, to CNAF by the Trustee or
to CNAF and the Trustee by the Holders of at least 25% in principal amount of
the Outstanding Securities of that series a written notice specifying such
default or breach and requiring it to be remedied; or


                                       36
<PAGE>
     (d) the entry of a decree or order by a court having jurisdiction in the
premises adjudging CNAF a bankrupt or insolvent, or approving as properly filed
a petition seeking reorganization, arrangement, adjustment or composition of or
in respect of CNAF under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law, or appointing a receiver, liquidator,
assignee, trustee, sequestrator (or other similar official) of CNAF or of any
substantial part of its property or ordering the winding up or liquidation of
its affairs, and the continuance of any such decree or order unstayed and in
effect for a period of 90 consecutive days; or

     (e) the institution by CNAF of proceedings to be adjudicated a bankrupt or
insolvent, or the consent by it to the institution of bankruptcy or insolvency
proceedings against it, or the filing by it of a petition or answer or consent
seeking reorganization or relief under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law, or the consent by
it to the filing of any such petition or to the appointment of a receiver,
liquidator, assignee, trustee, sequestrator (or other similar official) of CNAF
or of any substantial part of its property, or the making by it of an assignment
for the benefit for creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due and its willingness to
be adjudicated a bankrupt or insolvent, or the taking of corporate action by
CNAF in furtherance of any such action; or

     (f) any other Event of Default with respect to Securities of that series.

     SECTION 5.2. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.

     If an Event of Default with respect to Securities of any series at the time
Outstanding occurs and is continuing, then and in every such case the Trustee or
the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series may declare the principal amount (or, if the
Securities of that series are Discount Securities, such portion of the principal
amount as may be specified in the terms of that series) of all the Securities of
that series to be due and payable immediately, by a notice in writing to CNAF
(and to the Trustee if given by Holders), provided, that, in the case of the
Securities of a series issued to a CNA Capital Trust, if, upon an Event of
Default, the Trustee or the Holders of not less than 25% in principal amount of
the Outstanding Securities of that series fail to declare the principal of all
the Securities of that series to be immediately due and payable, the holders of
at least 25% in aggregate liquidation amount of the corresponding series of
Preferred Securities then outstanding shall have such right by a notice in
writing to CNAF and the Trustee; and upon any such declaration such principal
amount (or specified amount) of and the accrued interest (including any
Additional Interest) on all the Securities of such series shall become
immediately due and payable. Payment of principal and interest (including any
Additional Interest) on such Securities shall remain subordinated to the extent
provided in Article Thirteen notwithstanding that such amount shall become
immediately due and payable as herein provided. If an Event of Default specified
in Section 5.1(d) or 5.1(e) with respect to Securities of any series at the time
Outstanding occurs, the principal amount of all the Securities of that series
(or, if the Securities of that series are Discount Securities, such portion of
the principal amount of such Securities as may be specified by the terms of that
series) shall automatically, and without any declaration or other action on the
part of the Trustee or any Holder, become immediately due and payable.


                                       37
<PAGE>
     At any time after a declaration of acceleration with respect to Securities
of any series has been made and before a judgment or decree for payment of the
money due has been obtained by the Trustee as hereinafter in this Article
provided, the Holders of a majority in principal amount of the Outstanding
Securities of that series, by written notice to CNAF and the Trustee, may
rescind and annul such declaration and its consequences if:

     (a) CNAF has paid or deposited with the Trustee a sum of money sufficient
to pay in the currency in which the Securities of such series are payable
(except as otherwise specified pursuant to Section 3.1 for the Securities of
such series:

          (i) all overdue installments of interest (including any Additional
Interest) on all Securities of that series,

          (ii) the principal of any Securities of that series which have become
due otherwise than by such declaration of acceleration and interest thereon at
the Interest Rate borne by the Securities,

          (iii) to the extent that payment of such interest is lawful, interest
upon overdue installments of interest at the Interest Rate or Interest Rates
borne by or provided for in such Securities, and

          (iv) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.

     (b) all Events of Default with respect to Securities of that series, other
than the non-payment of the principal of Securities of that series which has
become due solely by such acceleration, have been cured or waived as provided in
Section 5.13.

     No such rescission shall affect any subsequent default or impair any right
consequent thereon.

     SECTION 5.3. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE.

     CNAF covenants that if:

     (a) default is made in the payment of any installment of interest
(including any Additional Interest) on any Security when such interest becomes
due and payable and such default continues for a period of 30 days, or

     (b) default is made in the payment of the principal of (and premium, if
any, on) any Security at the Maturity thereof

CNAF will, upon demand of the Trustee, pay to the Trustee, for the benefit of
the Holders of such Securities, the whole amount then due and payable on such
Securities for principal, including any sinking fund payment or analogous
obligations, (and premium, if any), and interest (including any Additional
Interest); and, in addition thereto, all amounts owing the Trustee under Section
6.7.


                                       38
<PAGE>
     If CNAF fails to pay such amounts forthwith upon such demand, the Trustee,
in its own name and as trustee of an express trust, may institute a judicial
proceeding for the collection of the sums so due and unpaid, and may prosecute
such proceeding to judgment or final decree, and may enforce the same against
CNAF or any other obligor upon the Securities and collect the moneys adjudged or
decreed to be payable in the manner provided by law out of the property of CNAF
or any other obligor upon the Securities, wherever situated.

     If an Event of Default with respect to Securities of any series occurs and
is continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Junior Indenture or in aid of the exercise of any
power granted herein, or to enforce any other proper remedy.

     SECTION 5.4. TRUSTEE MAY FILE PROOFS OF CLAIM.

     In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to CNAF or any other obligor upon the Securities or
the property of CNAF or of such other obligor or their creditors,

     (a) the Trustee (irrespective of whether the principal of the Securities of
any series shall then be due and payable as therein expressed or by declaration
or otherwise and irrespective of whether the Trustee shall have made any demand
on CNAF for the payment of overdue principal or interest (including any
Additional Interest)) shall be entitled and empowered, by intervention in such
proceeding or otherwise,

          (i) to file and prove a claim for the whole amount of principal and
interest (including any Additional Interest) owing and unpaid in respect to the
Securities and to file such other papers or documents as may be necessary or
advisable and to take any and all actions as are authorized under the Trust
Indenture Act in order to have the claims of the Holders and any predecessor to
the Trustee under Section 6.7 and of the Holders allowed in any such judicial
proceedings; and

          (ii) and in particular, the Trustee shall be authorized to collect and
receive any moneys or other property payable or deliverable on any such claims
and to distribute the same in accordance with Section 5.6; and

     (b) any custodian, receiver, assignee, trustee, liquidator, sequestrator
(or other similar official) in any such judicial proceeding is hereby authorized
by each Holder of Securities of such series to make such payments to the Trustee
for distribution in accordance with Section 5.6, and in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amount due to it and any predecessor Trustee under
Section 6.7.

     Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement,


                                       39
<PAGE>
adjustment or composition affecting the Securities or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Holder in any such proceeding.

     SECTION 5.5. TRUSTEE MAY ENFORCE CLAIM WITHOUT POSSESSION OF SECURITIES.

     All rights of action and claims under this Junior Indenture or the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of all the amounts owing the Trustee and any
predecessor Trustee under Section 6.7, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.

     SECTION 5.6. APPLICATION OF MONEY COLLECTED.

     Any money or property collected by the Trustee with respect to a series of
Securities pursuant to this Article shall be applied in the following order, at
the date or dates fixed by the Trustee and, in case of the distribution of such
money or property on account of principal or interest (including any Additional
Interest), upon presentation of the Securities, and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:

     FIRST: To the payment of all amounts due the Trustee and any predecessor
Trustee under Section 6.7;

     SECOND: To the payment of the amounts then due and unpaid upon such series
of Securities for principal (and premium, if any) and interest (including any
Additional Interest), in respect of which or for the benefit of which such money
has been collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such series of Securities for
principal and interest (including any Additional Interest), respectively; and

     THIRD: The balance, if any, to the Person or Persons entitled thereto.

     SECTION 5.7. LIMITATION ON SUITS.

     No Holder of any Securities of any series shall have any right to institute
any proceeding, judicial or otherwise, with respect to this Junior Indenture or
for the appointment of a receiver, assignee, trustee, liquidator, sequestrator
(or other similar official) or for any other remedy hereunder, unless:

     (a) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Securities of that series;

     (b) the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;


                                       40
<PAGE>
     (c) such Holder or Holders have offered to the Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred in compliance with
such request;

     (d) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and

     (e) no direction inconsistent with such written request has been given to
the Trustee during such 60-day period by the Holders of a majority in principal
amount of the Outstanding Securities of that series;

it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing itself of, any
provision of this Junior Indenture to affect, disturb or prejudice the rights of
any other Holders of Securities, or to obtain or to seek to obtain priority or
preference over any other of such Holders or to enforce any right under this
Junior Indenture, except in the manner herein provided and for the equal and
ratable benefit of all such Holders.

     SECTION 5.8. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, INTEREST
AND OTHER AMOUNTS.

     Notwithstanding any other provision in this Junior Indenture, the Holder of
any Security shall have the right which is absolute and unconditional to receive
payment of the principal of (and premium, if any) and (subject to Section 3.7)
interest (including any Additional Interest and Additional Sums) on such
Security on the respective Stated Maturities expressed in such Security and to
institute suit for the enforcement of any such payment (or for the conversion or
exchange of the Securities in accordance with their terms, to the extent
applicable), and such right shall not be impaired without the consent of such
Holder. In the case of Securities of a series issued to a CNA Capital Trust, any
holder of the corresponding series of Preferred Securities shall have the right,
upon the occurrence of an Event of Default described in Section 5.1(a) or 5.1(b)
hereof, to institute a suit directly against CNAF for enforcement of payment to
such Holder of principal of (and premium, if any) and (subject to Section 3.7)
interest (including any Additional Interest and Additional Sums) on the
Securities having a principal amount equal to the aggregate liquidation amount
of the Preferred Securities of the corresponding series held by such Holder.

     SECTION 5.9. RESTORATION OF RIGHTS AND REMEDIES.

     If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Junior Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case CNAF, the Trustee and
the Holders shall, subject to any determination in such proceeding, be restored
severally and respectively to their former positions hereunder, and thereafter
all rights and remedies of the Trustee and the Holders shall continue as though
no such proceeding had been instituted.


                                       41
<PAGE>
     SECTION 5.10. RIGHTS AND REMEDIES CUMULATIVE.

     Except as otherwise provided in the last paragraph of Section 3.6, no right
or remedy herein conferred upon or reserved to the Trustee or to the Holders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.

     SECTION 5.11. DELAY OR OMISSION NOT WAIVER.

     No delay or omission of the Trustee or of any Holder of any Security to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein.

     Every right and remedy given by this Article or by law to the Trustee or to
the Holders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.

     SECTION 5.12. CONTROL BY HOLDERS OF SECURITIES.

     The Holders of a majority in principal amount of the Outstanding Securities
of any series (or in the case of Securities of a series held of record by a CNA
Capital Trust, the holders of a majority of the aggregate liquidation amount of
the Preferred Securities of the corresponding series) shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred on the
Trustee, with respect to the Securities of such series, provided that:

     (1) such direction shall not be in conflict with any rule of law or with
this Junior Indenture,

     (2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction, and

     (3) subject to the provisions of Section 6.1, the Trustee shall have the
right to decline to follow such direction if the Trustee in good faith shall, by
a Responsible Officer or Officers of the Trustee, determine that the proceeding
so directed would be unjustly prejudicial to the Holders (or such holders of
Preferred Securities, as applicable) not joining in any such direction or would
involve the Trustee in personal liability.

     SECTION 5.13. WAIVER OF PAST DEFAULTS.

     The Holders of a majority in principal amount of the Outstanding Securities
of any series (or in the case of Securities of a series held of record by a CNA
Capital Trust, the holders of a majority of the aggregate liquidation amount of
the Preferred Securities of the corresponding series) may on behalf of the
Holders of all the Securities of such series (or such holders of


                                       42
<PAGE>
Preferred Securities) waive any past default hereunder and its consequences with
respect to such series except a default:

     (1) in the payment of the principal of or interest (including any
Additional Interest and Additional Sums) on any Security of such series, or

     (2) in respect of a covenant or provision hereof which under Article Nine
cannot be modified or amended without the consent of the Holder of each
Outstanding Security of such series affected.

     Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Junior Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.

     SECTION 5.14. UNDERTAKING FOR COSTS.

     All parties to this Junior Indenture agree, and each Holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Junior Indenture, or in any suit against the Trustee for any action
taken or omitted by it as Trustee, the filing by any party litigant in such suit
of an undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% in principal amount of the Outstanding Securities of
any series, or to any suit instituted by any Holder for the enforcement of the
payment of the principal of (or premium, if any) or interest (including any
Additional Interest and Additional Sums) on any Security on or after the
respective Stated Maturities expressed in such Security or for the conversion or
exchange of the Securities in accordance with their terms.

                                   ARTICLE VI.
                                   THE TRUSTEE

     SECTION 6.1. CERTAIN DUTIES AND RESPONSIBILITIES.

     (a) Except during the continuance of an Event of Default,

          (i) the Trustee undertakes to perform such duties and only such duties
as are specifically set forth in this Junior Indenture, and no implied covenants
or obligations shall be read into this Junior Indenture against the Trustee; and

          (ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Junior Indenture; but in the
case of any such certificates or opinions which by any provisions


                                       43
<PAGE>
hereof are specifically required to be furnished to the Trustee, the Trustee
shall be under a duty to examine the same to determine whether or not they
conform to the requirements of this Junior Indenture.

     (b) In case an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Junior
Indenture, and use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
his own affairs.

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

          (i) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;

          (ii) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the Trustee
was negligent in ascertaining the pertinent facts; and

          (iii) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction of
Holders pursuant to Section 5.12 relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under this Junior Indenture with
respect to the Securities of such series.

     (d) No provision of this Junior Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if there shall be reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.

     (e) Whether or not therein expressly so provided, every provision of this
Junior Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section.

     SECTION 6.2. NOTICE OF DEFAULTS.

     Within 90 days after actual knowledge by a Responsible Officer of the
Trustee of the occurrence of any default hereunder with respect to the
Securities of any series, the Trustee shall transmit by mail to all Holders of
Securities of such series, as their names and addresses appear in the Securities
Register, notice of such default hereunder known to the Trustee, unless such
default shall have been cured or waived; provided, however, that, except in the
case of a default in the payment of the principal of or interest (including any
Additional Interest) on any Security of such series, the Trustee shall be
protected in withholding such notice if and so long as the board of directors,
the executive committee or a trust committee of directors and/or Responsible
Officers of the Trustee in good faith determines that the withholding of such
notice is in the best interests of the Holders of Securities of such series; and
provided, further, that, in the case of any


                                       44
<PAGE>
default of the character specified in Section 5.1(c) with respect to the
Securities of any series, no such notice to Holders of Securities of such series
shall be given until at least 30 days after the occurrence thereof. For the
purpose of this Section, the term "default" means any event which is, or after
notice or lapse of time or both would become, an Event of Default with respect
to Securities of such series.

     SECTION 6.3. CERTAIN RIGHTS OF TRUSTEE.

     Subject to the provisions of Section 6.1:

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

     (b) any request or direction of CNAF mentioned herein shall be sufficiently
evidenced by a CNAF Request or CNAF Order (other than delivery of any Security
to the Trustee for authentication and delivery pursuant to Section 3.3 which
shall be sufficiently evidenced as provided therein) and any resolution of the
Board of Directors may be sufficiently evidenced by a Board Resolution;

     (c) whenever in the administration of this Junior Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;

     (d) the Trustee may consult with counsel and the advice of such counsel or
any Opinion of Counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon;

     (e) the Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Junior Indenture at the request or direction of
any of the Holders pursuant to this Junior Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction;

     (f) the Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, indenture,
Security or other paper or document, but the Trustee in its discretion may make
such inquiry or investigation into such facts or matters as it may see fit, and,
if the Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of CNAF, personally
or by agent or attorney; and

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


                                       45
<PAGE>
     SECTION 6.4. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.

     The recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of CNAF, and
the Trustee assumes no responsibility for their correctness. The Trustee makes
no representations as to the validity or sufficiency of this Junior Indenture or
of the Securities except that the Trustee represents that it is duly authorized
to execute and deliver this Junior Indenture, authenticate the Securities and
perform its obligations hereunder and that the statements made by it in the
Statement of Eligibility on Form T-1 supplied to CNAF are true and correct. The
Trustee shall not be accountable for the use or application by CNAF of the
Securities or the proceeds thereof.

     SECTION 6.5. MAY HOLD SECURITIES.

     The Trustee, any Paying Agent, Securities Registrar or any other agent of
CNAF, in its individual or any other capacity, may become the owner or pledgee
of Securities and, subject to Sections 6.8 and 6.13, may otherwise deal with
CNAF and its Affiliates with the same rights it would have if it were not
Trustee, Paying Agent, Securities Registrar or such other agent.

     SECTION 6.6. MONEY HELD IN TRUST.

     Except as provided in Section 4.2, money held by the Trustee in trust
hereunder need not be segregated from other funds except to the extent required
by law. The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed with CNAF.

     SECTION 6.7. COMPENSATION AND REIMBURSEMENT.

     CNAF agrees

     (1) to pay to the Trustee from time to time reasonable compensation for all
services rendered by it hereunder in such amounts as CNAF and the Trustee shall
agree from time to time (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust);

     (2) to reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any provision of this Junior Indenture (including the reasonable compensation
and the expenses and disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to its negligence or bad
faith; and

     (3) to indemnify the Trustee for, and to hold it harmless against, any
loss, liability or expense (including the reasonable compensation and the
expenses and disbursements of its agents and counsel) incurred without
negligence or bad faith, arising out of or in connection with the acceptance or
administration of this trust or the performance of its duties hereunder,
including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers or
duties hereunder.


                                       46
<PAGE>
     This indemnification shall survive the termination of this Agreement and
the resignation or removal of the Trustees.

     To secure CNAF's payment obligations in this Section, CNAF and the Holders
agree that the Trustee shall have a lien prior to the Securities on all money or
property held or collected by the Trustee, except funds held in trust by the
Trustee for the benefit of Holders of Securities. Such lien shall survive the
satisfaction and discharge of this Junior Indenture.

     When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 5.1(d) or (e) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any applicable federal or state bankruptcy, insolvency or
similar law.

     SECTION 6.8. DISQUALIFICATION; CONFLICTING INTERESTS.

     The Trustee for the Securities of any series issued hereunder shall be
subject to the provisions of Section 310(b) of the Trust Indenture Act. Each
Trust Agreement and Guarantee with respect to all other CNAF Trusts are hereby
excluded. Nothing herein shall prevent the Trustee from filing with the
Commission the application referred to in the second to last paragraph of
Section 310(b) of the Trust Indenture Act.

     SECTION 6.9. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.

     There shall at all times be a Trustee hereunder which shall be

     (a) a corporation organized and doing business under the laws of the United
States of America or of any State, Territory or the District of Columbia,
authorized under such laws to exercise corporate trust powers, or

     (b) a corporation or other Person organized and doing business under the
laws of a foreign government that is permitted to act as Trustee pursuant to a
rule, regulation or order of the Commission, authorized under such laws to
exercise corporate trust powers, and subject to supervision or examination by
authority of such foreign government or a political subdivision thereof
substantially equivalent to supervision or examination applicable to United
States institutional trustees, in either case having a combined capital and
surplus of at least $50,000,000, subject to supervision or examination by
Federal, State, Territorial, or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of the aforesaid supervising or examining authority, then,
for the purposes of this Section 6.9, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect hereinafter specified
in this Article Six. Neither CNAF nor any Person directly or indirectly
controlling, controlled by or under common control with CNAF shall serve as
Trustee for the Securities of any series issued hereunder.


                                       47
<PAGE>
     SECTION 6.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.

     (a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.11.

     (b) The Trustee may resign at any time with respect to the Securities of
one or more series by giving written notice thereof to CNAF. If an instrument of
acceptance by a successor Trustee shall not have been delivered to the Trustee
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment of
a successor Trustee with respect to the Securities of such series.

     (c) The Trustee may be removed at any time with respect to the Securities
of any series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to CNAF.

     (d) If at any time:

          (i) the Trustee shall fail to comply with Section 6.8 after written
request therefor by CNAF or by any Holder who has been a bona fide Holder of a
Security for at least six months, or

          (ii) the Trustee shall cease to be eligible under Section 6.9 and
shall fail to resign after written request therefor by CNAF or by any such
Holder, or

          (iii) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation then, in any such case, (i) CNAF, acting pursuant to
the authority of a Board Resolution, may remove the Trustee and appoint a
successor Trustee with respect to all Securities, or (ii) subject to Section
5.14, any Holder who has been a bona fide Holder of a Security for at least six
months may, on behalf of himself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.

     (e) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause with respect
to the Securities of one or more series, CNAF, by a Board Resolution, shall
promptly appoint a successor Trustee with respect to the Securities of that or
those series. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee with
respect to the Securities of any series shall be appointed by Act of the Holders
of a majority in principal amount of the Outstanding Securities of such series
delivered to CNAF and the retiring Trustee, the successor Trustee so appointed
shall, forthwith upon its acceptance of such appointment, become the successor
Trustee with respect to the Securities of such series and supersede the
successor Trustee appointed by CNAF. If no successor Trustee with respect to the
Securities of any series shall have been so appointed by CNAF or the Holders and
accepted appointment in the manner hereinafter provided, any Holder who has been
a bona fide Holder of a Security for at


                                       48
<PAGE>
least six months may, subject to Section 5.14, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.

     (f) CNAF shall give notice of each resignation and each removal of the
Trustee with respect to the Securities of any series and each appointment of a
successor Trustee with respect to the Securities of any series by mailing
written notice of such event by first-class mail, postage prepaid, to the
Holders of Securities of such series as their names and addresses appear in the
Securities Register. Each notice shall include the name of the successor Trustee
with respect to the Securities of such series and the address of its Corporate
Trust Office.

     SECTION 6.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.

     (a) In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to CNAF and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on the request
of CNAF or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder.

     (b) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, CNAF, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Trustee all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates, (2)
if the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Junior Indenture as
shall be necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee; and upon the execution and delivery of such supplemental
indenture the resignation or removal of the retiring Trustee shall become
effective to the extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts, and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates; but, on request of CNAF or any successor Trustee, such retiring
Trustee shall duly assign, transfer and deliver to such successor Trustee all
property and money held by such retiring


                                       49
<PAGE>
Trustee hereunder with respect to the Securities of that or those series to
which the appointment of such successor Trustee relates.

     (c) Upon request of any such successor Trustee, CNAF shall execute any and
all instruments for more fully and certainly vesting in and confirming to such
successor Trustee all rights, powers and trusts referred to in subsection (a) or
(b) of this Section, as the case may be.

     (d) No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.

     SECTION 6.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.

     Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article Six, without the execution or filing of any paper or any further act on
the part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated, with the same
effect as if such successor Trustee had itself authenticated such Securities. In
case any Securities shall not have been authenticated, any successor to the
Trustee may authenticate such Securities either in the name of any predecessor
Trustee or in the name of such successor Trustee, and in all cases the
certificate of authentication shall have the full force which it is provided
anywhere in the Securities or in this Junior Indenture that the certificate of
the Trustee shall have.

     SECTION 6.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST CNAF.

     If and when the Trustee shall be or become a creditor of CNAF (or any other
obligor upon the Securities), the Trustee shall be subject to the provisions of
the Trust Indenture Act regarding the collection of claims against CNAF (or any
such other obligor).

     SECTION 6.14. APPOINTMENT OF AUTHENTICATING AGENT.

     The Trustee may appoint an Authenticating Agent or Agents with respect to
one or more series of Securities which shall be authorized to act on behalf of
the Trustee to authenticate Securities of such series issued upon original issue
and upon exchange, registration of transfer or partial redemption thereof, and
Securities so authenticated shall be entitled to the benefits of this Junior
Indenture and shall be valid and obligatory for all purposes as if authenticated
by the Trustee hereunder. Any such appointment shall be evidenced by an
instrument in writing signed by a Responsible Officer for the Trustee a copy of
which instrument shall be promptly furnished to CNAF. Wherever reference is made
in this Junior Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent other than an Affiliate of the
Trustee shall be acceptable to


                                       50
<PAGE>
CNAF and shall at all times be a corporation organized and doing business under
the laws of the United States of America, or of any State, Territory or the
District of Columbia, authorized under such laws to act as Authenticating Agent,
having a combined capital and surplus of not less than $50,000,000 and subject
to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.

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

     An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to CNAF. The Trustee may at any time terminate the
agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to CNAF. Upon receiving such a notice of resignation or
upon such a termination, or in case at any time such Authenticating Agent shall
cease to be eligible in accordance with the provisions of this Section, the
Trustee may appoint a successor Authenticating Agent which shall be acceptable
to CNAF and shall give notice of such appointment in the manner provided in
Section 1.6 to all Holders of Securities of the series with respect to which
such Authenticating Agent will serve. Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with all the rights,
powers and duties of its predecessor hereunder, with like effect as if
originally named as an Authenticating Agent. No successor Authenticating Agent
shall be appointed unless eligible under the provision of this Section.

     The Trustee agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section, and the Trustee
shall be entitled to be reimbursed for such payments, subject to the provisions
of Section 6.7.

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


                                       51
<PAGE>
     This is one of the Securities referred to in the within mentioned Junior
Indenture.

                                        ----------------------------------------
                                        As Trustee


                                        By:
                                            ------------------------------------
                                            As Authenticating Agent


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

                                  ARTICLE VII.
                 HOLDER'S LISTS AND REPORTS BY TRUSTEE AND CNAF

     SECTION 7.1. DISCLOSURE OF NAMES AND ADDRESSES OF HOLDERS.

     In accordance with Section 312(a) of the Trust Indenture Act, CNAF will
furnish or cause to be furnished to the Trustee:

     (a) semi-annually, not more than 15 days after January 15 and July 15, a
list, in such form as the Trustee may reasonably require, of the names and
addresses of the Holders as of such January 1 and July 1, and

     (b) such other times as the Trustee may request in writing, within 30 days
after the receipt by CNAF of any such request, a list of similar form and
content as of a date not more than 15 days prior to the time such list is
furnished, excluding from any such list names and addresses received by the
Trustee in its capacity as Securities Registrar.

     SECTION 7.2. PRESERVATION OF INFORMATION, COMMUNICATIONS TO HOLDERS.

     (a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 7.1 and the names and
addresses of Holders received by the Trustee in its capacity as Securities
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 7.1 upon receipt of a new list so furnished.

     (b) The rights of Holders to communicate with other Holders with respect to
their rights under this Junior Indenture or under the Securities, and the
corresponding rights and privileges of the Trustee, shall be as provided in the
Trust Indenture Act.

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


                                       52
<PAGE>
     SECTION 7.3. REPORTS BY TRUSTEE.

     (a) The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Junior Indenture as may be required pursuant
to the Trust Indenture Act, at the times and in the manner provided pursuant
thereto.

     (b) Reports so required to be transmitted at stated intervals of not more
than 12 months shall be transmitted no later than July 15 in each calendar year,
commencing with the first July 15 after the first issuance of Securities under
this Junior Indenture.

     (c) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange, if any, upon which
the Securities are listed and also with the Commission. CNAF will notify the
Trustee whenever the Securities are listed on any stock exchange.

     SECTION 7.4. REPORTS BY CNAF.

     CNAF shall file with the Trustee and with the Commission, and transmit to
Holders, such information, documents and other reports, and such summaries
thereof, as may be required pursuant to the Trust Indenture Act at the times and
in the manner provided in the Trust Indenture Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
shall be filed with the Trustee within 15 days after the same is required to be
filed with the Commission. Notwithstanding that CNAF may not be required to
remain subject to the reporting requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, CNAF shall continue to file with the Commission
and provide the Trustee with the annual reports and the information, documents
and other reports which are specified in Sections 13 and 15(d) of the Securities
Exchange Act of 1934. CNAF also shall comply with the other provisions of Trust
Indenture Act Section 314(a).

                                  ARTICLE VIII.
              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

     SECTION 8.1. CNAF MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.

     CNAF shall not consolidate with or merge into any other Person or convey,
transfer or lease its properties and assets as an entirety or substantially as
an entirety to any Person, and no Person shall consolidate with or merge into
CNAF or convey, transfer or lease its properties and assets substantially as an
entirety to CNAF, unless:

     (1) In case CNAF shall consolidate with or merge into another Person or
convey, transfer or lease its properties and assets substantially as an entirety
to another Person, the corporation formed by such consolidation or into which
CNAF is merged or the Person which acquires by conveyance or transfer, or which
leases, the properties and assets of CNAF as an entirety or substantially as an
entirety shall be a corporation, partnership or trust organized and existing
under the laws of the United States of America or any State or the District of
Columbia,


                                       53
<PAGE>
and shall expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee, the due and
punctual payment of the principal of (and premium, if any) and interest
(including any Additional Interest and Additional Sums) on all the Securities
and the performance of every covenant of this Junior Indenture on the part of
CNAF to be performed or observed;

     (2) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time, or both, would
become an Event of Default, shall have happened and be continuing;

     (3) in the case of the Securities of a series issued to a CNA Capital
Trust, such consolidation, merger, conveyance, transfer or lease is permitted
under the related Trust Agreement and CNAF Guarantee and does not give rise to
any breach or violation of the related Trust Agreement or CNAF Guarantee; and

     (4) CNAF has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel each stating that such consolidation, merger, conveyance,
transfer or lease and any such supplemental indenture complies with this Article
and that all conditions precedent herein provided for relating to such
transaction have been complied with; and the Trustee, subject to Section 6.1,
may rely upon such Officers' Certificate and Opinion of Counsel as conclusive
evidence that such transaction complies with this Section 8.1.

     SECTION 8.2. SUCCESSOR PERSON SUBSTITUTED.

     Upon any consolidation or merger by CNAF with or into any other Person, or
any conveyance, transfer or lease by CNAF of its properties and assets as an
entirety or substantially as an entirety to any Person in accordance with
Section 8.1, the successor Person formed by such consolidation or into which
CNAF is merged or to which such conveyance, transfer or lease is made shall
succeed to, and be substituted for, and may exercise every right and power of,
CNAF under this Junior Indenture with the same effect as if such successor
Person had been named as CNAF herein; and thereafter, except in the case of a
lease, CNAF shall be discharged from all obligations and covenants under the
Junior Indenture and the Securities and may be dissolved and liquidated.

     A successor Person may cause to be signed, and may issue either in its own
name or in the name of CNAF, any or all of the Securities issuable hereunder
which theretofore shall not have been signed by CNAF and delivered to the
Trustee; and, upon the order of such successor Person instead of CNAF and
subject to all the terms, conditions and limitations in this Junior Indenture
prescribed, the Trustee shall authenticate and shall deliver any Securities
which previously shall have been signed and delivered by the officers of CNAF to
the Trustee for authentication pursuant to such provisions and any Securities
which such successor Person thereafter shall cause to be signed and delivered to
the Trustee on its behalf for the purpose pursuant to such provisions. All the
Securities so issued shall in all respects have the same legal rank and benefit
under this Junior Indenture as the Securities theretofore or thereafter issued
in accordance with the terms of this Junior Indenture as though all of such
Securities had been issued at the date of the execution hereof.


                                       54
<PAGE>
     In case of any such consolidation, merger, sale, conveyance or lease, such
changes in phraseology and form may be made in the Securities thereafter to be
issued as may be appropriate.

                                   ARTICLE IX.
                             SUPPLEMENTAL INDENTURES

     SECTION 9.1. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.

     Without the consent of any Holders, CNAF, when authorized by or pursuant to
a Board Resolution, and the Trustee, at any time and from time to time, may
enter into one or more indentures supplemental hereto, in form satisfactory to
the Trustee, for any of the following purposes:

     (1) to evidence the succession of another Person to CNAF, and the
assumption by any such successor of the covenants of CNAF herein and in the
Securities contained; or

     (2) to convey, transfer, assign, mortgage or pledge any property to or with
the Trustee or to surrender any right or power herein conferred upon CNAF; or

     (3) to establish the form or terms of Securities of any series as permitted
by Sections 2.1 or 3.1; or

     (4) to add to the covenants of CNAF for the benefit of the Holders of all
or any series of Securities (and if such covenants are to be for the benefit of
less than all series of Securities, stating that such covenants are expressly
being included solely for the benefit of such series); or

     (5) to add any additional Events of Default for the benefit of the Holders
of all or any series of Securities (and if such Events of Default are to be for
the benefit of less than all series of Securities, stating that such Events of
Default are expressly being included solely for the benefit of such series); or

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

     (7) to cure any ambiguity, to correct or supplement any provision herein
which may be inconsistent with any other provision herein, or to make any other
provisions with respect to matters or questions arising under this Junior
Indenture, provided that any action pursuant to this clause (7) shall not
materially adversely affect the interest of the Holders of Securities of any
series or, in the case of the Securities of a series issued to a CNA Capital
Trust and for so long as any of the corresponding series of Preferred Securities
shall remain outstanding, the holders of such Preferred Securities; or


                                       55
<PAGE>
     (8) to evidence and provide for the acceptance of appointment hereunder by
a successor Trustee with respect to the Securities of one or more series and to
add to or change any of the provisions of this Junior Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, pursuant to the requirements of Section
6.11(b); or

     (9) to comply with the requirements of the Commission in order to effect or
maintain the qualification of this Junior Indenture under the Trust Indenture
Act.

     SECTION 9.2. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.

     With the consent of the Holders of a majority in principal amount of the
Outstanding Securities of each series affected by such supplemental indenture,
by Act of said Holders delivered to CNAF and the Trustee, CNAF, when authorized
by a Board Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Junior Indenture or of
modifying in any manner the rights of the Holders of Securities of such series
under this Junior Indenture; provided, however, that no such supplemental
indenture shall, without the consent of the Holder of each Outstanding Security
affected thereby,

     (1) except to the extent permitted by Section 3.11 or 3.14 or as otherwise
specified as contemplated by Section 2.1 or 2.1 with respect to the deferral of
the payment of interest on the Securities of any series, change the Stated
Maturity of the principal of, or any installment of interest (including any
Additional Interest or Additional Sums) on, any such Security, or reduce the
principal amount thereof or the rate (or manner of calculation) of interest
thereon or change any provision regarding the redemption thereof, or reduce the
amount of principal of a Discount Security that would be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section 5.2, or
change the place of payment where, or the coin or currency in which, the
principal of, or interest (or premium, if any) on, any such Security is payable,
or impair the right to institute suit for the enforcement of any such payment on
or after the Stated Maturity thereof (or, in the case of redemption, on or after
the Redemption Date) or the conversion or exchange of any such Security in
accordance with the terms thereof to the extent applicable, or

     (2) reduce the percentage in principal amount of the Outstanding Securities
of any series, the consent of whose Holders is required for any such
supplemental indenture, or the consent of whose Holders is required for any
waiver (of compliance with certain provisions of this Junior Indenture or
certain defaults hereunder and their consequences) contemplated under in this
Junior Indenture, or

     (3) modify any of the provisions of this Section, Section 5.13 or Section
10.5, except to increase any such percentage or to provide that certain other
provisions of this Junior Indenture cannot be modified or waived without the
consent of the Holder of each Security affected thereby; or


                                       56
<PAGE>
     (4) modify the provisions in Article Thirteen of this Junior Indenture with
respect to the subordination of Outstanding Securities of any series in a manner
adverse to the Holders thereof;

provided that, in the case of the Securities of a series held of record by a CNA
Capital Trust, so long as any of the corresponding series of Preferred
Securities remains outstanding, no such amendment shall be made, without the
prior consent of the holders of a majority of the aggregate liquidation amount
of such Preferred Securities then outstanding; and provided further that in the
case of the Securities of a series held of record by a CNA Capital Trust, so
long as any of the corresponding series of Preferred Securities remain
outstanding, if the consent of the Holder of each Outstanding Security affected
thereby is required, no amendment shall be made without the prior consent of the
holders of each Preferred Security then outstanding.

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

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

     SECTION 9.3. EXECUTION OF SUPPLEMENTAL INDENTURES.

     In executing or accepting the additional trusts created by any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Junior Indenture, the Trustee shall be entitled to receive, and
(subject to Section 6.1) shall be fully protected in relying upon, an Officers'
Certificate and an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Junior Indenture and
that all conditions precedent have been complied with. The Trustee may, but
shall not be obligated to, enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under this Junior
Indenture or otherwise.

     SECTION 9.4. EFFECT OF SUPPLEMENTAL INDENTURES.

     Upon the execution of any supplemental indenture under this Article Nine or
delivery to the Trustee of the Officers' Certificate pursuant to Section 3.1
hereof (which Officers' Certificate shall have the effect of a supplemental
indenture for all purposes hereunder), this Junior Indenture shall be modified
in accordance therewith, and such supplemental indenture shall form a part of
this Junior Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder shall be bound
thereby.

     SECTION 9.5. CONFORMITY WITH TRUST INDENTURE ACT.

     Every supplemental indenture executed pursuant to this Article Nine and
every Officers' Certificate delivered to the Trustee pursuant to Section 3.1
hereof shall conform to the requirements of the Trust Indenture Act as then in
effect.


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     SECTION 9.6. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.

     Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article Nine or delivery to the Trustee
of the Officers' Certificate pursuant to Section 3.1 hereof (which Officers
Certificate shall have the effect of a supplemental indenture for all purposes
hereunder) may, and shall if required by CNAF, bear a notation in form approved
by CNAF as to any matter provided for in such supplemental indenture or such
Officers' Certificate. If CNAF shall so determine, new Securities of any series
so modified as to conform, in the opinion of CNAF, to any such supplemental
indenture or such Officers' Certificate may be prepared and executed by CNAF and
authenticated and delivered by the Trustee in exchange for Outstanding
Securities of such series.

                                   ARTICLE X.
                                    COVENANTS

     SECTION 10.1. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.

     CNAF covenants and agrees for the benefit of the Holders of each series of
Securities that it will duly and punctually pay the principal of (and premium,
if any) and interest (including Additional Interest and Additional Sums) on the
Securities of that series in accordance with the terms of such Securities and
this Junior Indenture.

     SECTION 10.2. MAINTENANCE OF OFFICE OR AGENCY.

     CNAF will maintain in each Place of Payment for any series an office or
agency where Securities of that series may be presented or surrendered for
payment, where Securities may be surrendered for transfer or exchange, where
Securities of that series that are convertible or exchangeable may be
surrendered for conversion or exchange, as applicable, and where notices and
demands to or upon CNAF in respect of the Securities and this Junior Indenture
may be served. CNAF initially appoints the Trustee, acting through its Corporate
Trust Office, as its agent for said purposes. CNAF will give prompt written
notice to the Trustee of any change in the location of any such office or
agency. If at any time CNAF shall fail to maintain such office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and CNAF hereby appoints the Trustee as its agent to
receive all such presentations, surrenders, notices and demands.

     CNAF may also from time to time designate one or more other offices or
agencies where the Securities may be presented or surrendered for any or all of
such purposes, and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve CNAF
of its obligation to maintain an office or agency in each Place of Payment for
Securities of any series for such purposes. CNAF will give prompt written notice
to the Trustee of any such designation and any change in the location of any
such office or agency.


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<PAGE>
     SECTION 10.3. MONEY FOR SECURITY PAYMENTS TO BE HELD IN TRUST.

     If CNAF shall at any time act as its own Paying Agent with respect to any
series of Securities, it will, on or before each due date of the principal of
(and premium, if any) or interest and other amounts on any of the Securities of
such series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal (and premium, if any) or interest
and other amounts so becoming due until such sums shall be paid to such Persons
or otherwise disposed of as herein provided, and will promptly notify the
Trustee of its failure so to act.

     Whenever CNAF shall have one or more Paying Agents, it will, prior to 10:00
a.m. New York City time on each due date of the principal of (and premium, if
any) or interest and other amounts on any Securities, deposit with a Paying
Agent a sum sufficient to pay the principal (and premium, if any) or interest
and other amounts so becoming due, such sum to be held in trust for the benefit
of the Persons entitled to such principal (and premium, if any) or interest and
other amounts, and (unless such Paying Agent is the Trustee) CNAF will promptly
notify the Trustee of its failure so to act.

     CNAF will cause each Paying Agent other than the Trustee to execute and
deliver to the Trustee an instrument in which such Paying Agent shall agree with
the Trustee, subject to the provisions of this Section 10.3, that such Paying
Agent will:

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

     (b) give the Trustee notice of any default by CNAF (or any other obligor
upon the Securities) in the making of any payment of principal (and premium, if
any) or interest or any other amounts payable hereunder;

     (c) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held in
trust by such Paying Agent; and

     (d) comply with the provisions of the Trust Indenture Act applicable to it
as a Paying Agent.

     CNAF may at any time, for the purpose of obtaining the satisfaction and
discharge of this Junior Indenture or for any other purpose, pay, or by CNAF
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
CNAF or such Paying Agent, such sums to be held by the Trustee upon the same
trusts as those upon which such sums were held by CNAF or such Paying Agent;
and, upon such payment by CNAF or any Paying Agent to the Trustee, such Paying
Agent shall be released from all further liability with respect to such sums.

     Except as provided in the Securities of any series, any money deposited
with the Trustee or any Paying Agent, or then held by CNAF, in trust for the
payment of the principal of (and premium, if any) or interest or any other
amounts on any Security and remaining unclaimed for two years after such
principal (and premium, if any) or interest or any other amounts has become


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due and payable shall (unless otherwise required by mandatory provision of
applicable escheat or abandoned or unclaimed property law) be paid on CNAF
Request to CNAF, or (if then held by CNAF) shall (unless otherwise required by
mandatory provision of applicable escheat or abandoned or unclaimed property
law) be discharged from such trust; and the Holder of such Security shall
thereafter, as an unsecured general creditor, look only to CNAF for payment
thereof, and all liability of the Trustee or such Paying Agent with respect to
such trust money, and all liability of CNAF as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of CNAF cause to be
published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the Borough of
Manhattan, the City of New York, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than 30 days from
the date of such publication, any unclaimed balance of such money then remaining
will be repaid to CNAF.

     SECTION 10.4. STATEMENT AS TO COMPLIANCE.

     CNAF shall deliver to the Trustee, within 120 days after the end of each
calendar year of CNAF ending after the date hereof, an Officers' Certificate
covering the preceding calendar year, stating whether or not to the best
knowledge of the signers thereof CNAF is in default in the performance,
observance or fulfillment of or compliance with any of the terms, provisions,
covenants and conditions of this Junior Indenture and, if CNAF shall be in
default, specifying all such defaults and the nature and status thereof of which
they may have knowledge. For the purpose of this Section 10.4, compliance shall
be determined without regard to any grace period or requirement of notice
provided pursuant to the terms of this Junior Indenture.

     SECTION 10.5. WAIVER OF CERTAIN COVENANTS.

     CNAF may omit in any particular instance to comply with any covenant or
condition as specified as contemplated by Section 3.1, 9.1(c) or 9.1(d) with
respect to the Securities of any series, if before or after the time for such
compliance the Holders of a majority in principal amount of the Outstanding
Securities of such series (or in the case of Securities of a series held of
record by a CNA Capital Trust, the holders of a majority of the aggregate
liquidation amount of the Preferred Securities of the corresponding series)
shall either waive such compliance in such instance or generally waive
compliance with such covenant or condition, but no such waiver shall extend to
or affect such covenant or condition except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of CNAF in
respect of any such covenant or condition shall remain in full force and effect.

     SECTION 10.6. ADDITIONAL SUMS.

     In the case of the Securities of a series issued to a CNA Capital Trust,
except as otherwise specified as contemplated by Section 3.1, in the event that
(i) a Property Trustee on behalf of a CNA Capital Trust is the Holder of all of
the Outstanding Securities of such series and (ii) a Tax Event in respect of
such CNA Capital Trust shall have occurred and be continuing, CNAF shall pay to
such CNA Capital Trust (and its permitted successors or assigns under the
related Trust Agreement), for so long as such CNA Capital Trust (or its
permitted successor or assignee) is the Holder of any Securities of such series,
such additional amounts as may be necessary in order


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<PAGE>
that the amount of distributions (including any Additional Amounts (as defined
in the Trust Agreement)) then due and payable by such CNA Capital Trust on the
related Preferred Securities and Common Securities that at any time remain
outstanding in accordance with the terms thereof shall not be reduced as a
result of any Additional Taxes (the "Additional Sums"). Whenever in this Junior
Indenture or the Securities there is a reference in any context to the payment
of principal of or interest on the Securities, such mention shall be deemed to
include mention of the payments of the Additional Sums provided for in this
paragraph to the extent that, in such context, Additional Sums are, were or
would be payable in respect thereof pursuant to the provisions of this paragraph
and express mention of the payment of Additional Sums (if applicable) in any
provisions hereof shall not be construed as excluding Additional Sums in those
provisions hereof where such express mention is not made; provided, however,
that the deferral of the payment of interest pursuant to Section 3.11 or the
Securities shall not extend the payment of any Additional Sums that may be due
and payable.

     SECTION 10.7. ADDITIONAL COVENANTS.

     CNAF covenants and agrees with each Holder of Securities of a series issued
to a CNA Capital Trust that it will not, and it will not permit any Subsidiary
of CNAF to, (a) declare or pay any dividends or distributions on, or redeem
purchase, acquire or make a liquidation payment with respect to, any shares of
CNAF's capital stock (which includes common and preferred stock), or (b) make
any payment of principal of, or interest or premium, if any, on, or repay,
repurchase or redeem any debt securities of CNAF (including securities other
than the Securities of such series) that rank pari passu in all respects with or
junior to the Securities of such series or (c) make any guarantee payments with
respect to any guarantee by CNAF of debt securities of any subsidiary of CNAF if
such guarantee ranks pari passu in all respects with or junior to the Securities
(other than (1) dividends or distributions in Common Stock of CNAF, (2) payments
under the related CNAF Guarantee, (3) purchases of Common Stock related to the
issuance of Common Stock under any of CNAF's benefit plans for its directors,
officers or employees), and (4) any declaration of a dividend in connection with
the implementation of a stockholder's rights plan, or issuance of stock under
any such plan in the future or a redemption or repurchase of any such rights
pursuant thereto) if at such time (i) there shall have occurred any event of
which CNAF has actual knowledge that (a) with the giving of notice or the lapse
of time or both, would constitute an Event of Default hereunder and (b) in
respect of which CNAF shall not have taken reasonable steps to cure, (ii) CNAF
shall be in default with respect to its payment of any obligations under the
related CNAF Guarantee or (iii) CNAF shall have given notice of its election to
begin an Extension Period as provided herein and shall not have rescinded such
notice, or such Extension Period, or any extension thereof, shall be continuing.

     CNAF also covenants and agrees with each Holder of Securities of a series
issued to a CNA Capital Trust (i) to maintain directly or indirectly 100%
ownership of the Common Securities of such CNA Capital Trust; provided, however,
that any permitted successor of CNAF hereunder may succeed to CNAF's ownership
of such Common Securities, (ii) not to voluntarily terminate, wind-up or
liquidate such CNA Capital Trust, except in connection with (a) a distribution
of the Securities of such series to the holders of Preferred Securities in
liquidation of such CNA Capital Trust, (b) the redemption of the Preferred
Securities, or (c) certain mergers, consolidations or amalgamations in each case
as permitted by the related Trust Agreement and (iii) to use its reasonable
efforts, consistent with the terms and provisions of such Trust


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Agreement, to cause (a) such CNA Capital Trust to remain classified as a grantor
trust and not an association taxable as a corporation for United States federal
income tax purposes or (b) each holder of Preferred Securities to be treated as
owning an undivided beneficial interest in the Securities.

                                  ARTICLE XI.
                            REDEMPTION OF SECURITIES

     SECTION 11.1. APPLICABILITY OF THIS ARTICLE.

     Securities of any series which are redeemable before the stated maturity
shall be redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 3.1 for Securities of any series) in
accordance with this Article.

     SECTION 11.2. ELECTION TO REDEEM; NOTICE TO TRUSTEE.

     The election of CNAF to redeem any Securities shall be evidenced by or
pursuant to a Board Resolution. In case of any redemption at the election of
CNAF of less than all of the Securities of any particular series and having the
same terms, CNAF shall, not less than 45 nor more than 60 days prior to the date
fixed for redemption (unless a shorter notice shall be satisfactory to the
Trustee), notify the Trustee of such date and of the principal amount of
Securities of that series to be redeemed. In the case of any redemption of
Securities prior to the expiration of any restriction on such redemption
provided in the terms of such Securities, CNAF shall furnish the Trustee with an
Officers' Certificate and an Opinion of Counsel evidencing compliance with such
restriction.

     SECTION 11.3. SELECTION BY TRUSTEE OF SECURITIES TO BE REDEEMED.

     If less than all the Securities of any series are to be redeemed (unless
all the Securities of such series and of a specified tenor are to be redeemed or
unless such redemption affects only a single Security), the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities of such series
not previously called for redemption, by such method as the Trustee shall deem
fair and appropriate and which may provide for the selection for redemption of a
portion of the principal amount of any Security of such series, provided that
the unredeemed portion of the principal amount of any Security shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security. If less than all the Securities of such series
and of a specified tenor are to be redeemed (unless such redemption affects only
a single Security), the particular Securities to be redeemed shall be selected
not more than 60 days prior to the Redemption Date by the Trustee, from the
Outstanding Securities of such series and specified tenor not previously called
for redemption in accordance with the preceding sentence.

     The Trustee shall promptly notify CNAF in writing of the Securities
selected for partial redemption and the principal amount thereof to be redeemed.
For all purposes of this Junior Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Security redeemed or to be redeemed only in part, to the


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<PAGE>
portion of the principal amount of such Security which has been or is to be
redeemed. If CNAF shall so direct, Securities registered in the name of CNAF,
any Affiliate or any Subsidiary thereof shall not be included in the Securities
selected for redemption.

     SECTION 11.4. NOTICE OF REDEMPTION.

     Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not later than the thirtieth day, and not earlier than the sixtieth day,
prior to the date fixed for redemption, to each Holder of Securities to be
redeemed, at the address of such Holder as it appears in the Securities
Register.

     With respect to Securities of each series to be redeemed, each notice of
redemption shall state:

     (a) the Redemption Date;

     (b) the Redemption Price;

     (c) if less than all Outstanding Securities of such particular series and
having the same terms are to be redeemed, the identification (and, in the case
of partial redemption, the respective principal amounts) of the particular
Securities to be redeemed;

     (d) that on the Redemption Date, the Redemption Price will become due and
payable upon each such Security or portion thereof, and that interest thereon,
if any, shall cease to accrue on and after said date;

     (e) the place or places where such Securities are to be surrendered for
payment of the Redemption Price; and

     (f) that the redemption is for a sinking fund, if such is the case.

     Notice of redemption of Securities to be redeemed at the election of CNAF
shall be given by CNAF or, at CNAF's request, by the Trustee in the name and at
the expense of CNAF and shall not be irrevocable. The notice if mailed in the
manner herein provided shall be conclusively presumed to have been duly given,
whether or not the Holder receives such notice. In any case, a failure to give
such notice by mail or any defect in the notice to the Holder of any Security
designated for redemption as a whole or in part shall not affect the validity of
the proceedings for the redemption of any other Security.

     SECTION 11.5. DEPOSIT OF REDEMPTION PRICE.

     Prior to 10:00 a.m. New York City time on the Redemption Date specified in
the notice of redemption given as provided in Section 11.4, CNAF will deposit
with the Trustee or with one or more Paying Agents (or if CNAF is acting as its
own Paying Agent, the Company will segregate and hold in trust as provided in
Section 10.3) an amount of money sufficient to redeem on the Redemption Date all
the Securities so called for redemption at the applicable Redemption Price,
together with any accrued interest (including Additional Interest) to the
Redemption Date.


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     SECTION 11.6. PAYMENT OF SECURITIES CALLED FOR REDEMPTION.

     If any notice of redemption has been given as provided in Section 11.4, the
Securities or portion of Securities with respect to which such notice has been
given shall become due and payable on the date and at the place or places stated
in such notice at the applicable Redemption Price. On presentation and surrender
of such Securities at a Place of Payment in said notice specified, the said
securities or the specified portions thereof shall be paid and redeemed by CNAF
at the applicable Redemption Price together with any accrued interest (including
Additional Interest) to the Redemption Date; provided, however, that, unless
otherwise specified as contemplated by Section 3.1, installments of interest
whose Stated Maturity is on or prior to the Redemption Date will be payable to
the Holders of such Securities, or one or more Predecessor Securities,
registered as such at the close of business on the relevant Record Dates
according to their terms and the provisions of Section 3.7.

     Upon presentation of any Security redeemed in part only, CNAF shall execute
and the Trustee shall authenticate and deliver to the Holder thereof, at the
expense of CNAF, a new Security or Securities of the same series, of authorized
denominations, in aggregate principal amount equal to the unredeemed portion of
the Security so presented and having the same Original Issue Date, Stated
Maturity and other terms. If a Global Security is so surrendered, such new
Security will also be a new Global Security.

     If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal of and premium, if any, (and, to the
extent legally enforceable, interest) on such Security shall, until paid, bear
interest from the Redemption Date at the rate prescribed therefor in the
Security.

     SECTION 11.7. CNAF'S RIGHT OF REDEMPTION.

     (a) Unless otherwise specified as contemplated by Section 3.1 with respect
to the Securities of a particular series and notwithstanding any additional
redemption rights that may be so specified, CNAF may, at its option, redeem the
Securities of any series after their date of issuance in whole at any time or in
part from time to time, subject to the provisions of this clause (a) and the
other provisions of this Article Eleven. Unless otherwise specified as
contemplated by Section 3.1 with respect to the Securities of a particular
series, the redemption price for any Security so redeemed pursuant to this
clause (a) shall be equal to 100% of the principal amount of such Securities
plus any accrued and unpaid interest, including any Additional Interest and
Additional Sums, to the date fixed for redemption. CNAF shall not redeem the
Securities in part unless all accrued and unpaid interest (including any
Additional Interest) has been paid in full on all Securities Outstanding for all
interest periods terminating on or prior to the Redemption Date.

     (b) In the case of the Securities of a series issued to a CNA Capital
Trust, except as otherwise specified as contemplated by Section 3.1, if a
Special Event in respect of such CNA Capital Trust shall occur and be
continuing, CNAF may, at its option, redeem the Securities of such series within
90 days of the occurrence of such Special Event, in whole but not in part,
subject to the provisions of this clause (b) and the other provisions of this
Article Eleven. The redemption price for any Security so redeemed pursuant to
this clause (b) shall be equal to 100%


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of the principal amount of such Securities then Outstanding plus accrued and
unpaid interest, including any Additional Interest and Additional Sums, to the
date fixed for redemption.

                                  ARTICLE XII.
                                  SINKING FUNDS

     SECTION 12.1. APPLICABILITY OF ARTICLE.

     The provisions of this Article shall be applicable to any sinking fund for
the retirement of Securities of any series except as otherwise specified as
contemplated by Section 3.1 for such Securities.

     The minimum amount of any sinking fund payment provided for by the terms of
any Securities of any series is herein referred to as a "mandatory sinking fund
payment", and any sinking fund payment in excess of such minimum amount which is
permitted to be made by the terms of such Securities of any series is herein
referred to as an "optional sinking fund payment". If provided for by the terms
of any Securities of any series, the cash amount of any sinking fund payment may
be subject to reduction as provided in Section 12.2. Each sinking fund payment
shall be applied to the redemption of Securities of any series as provided for
by the terms of such Securities.

     SECTION 12.2. SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.

     In lieu of making all or any part of a mandatory sinking fund payment with
respect to any Securities of a series in cash, CNAF may at its option, at any
time no more than 16 months and no less than 45 days prior to the date on which
such sinking fund payment is due, deliver to the Trustee Securities of such
series (together with the unmatured Coupons, if any, appertaining thereto)
theretofore purchased or otherwise acquired by CNAF or apply Securities which
had been previously so delivered and cancelled pursuant to Section 3.9, or apply
Securities which have been converted, if applicable, except Securities of such
series that have been redeemed through the application of mandatory or optional
sinking fund payments pursuant to the terms of the Securities of such series,
accompanied by a CNAF Order instructing the Trustee to credit such obligations
and stating that the Securities of such series were originally issued by CNAF by
way of bona fide sale or other negotiation for value; provided that the
Securities to be so credited have not been previously so credited. The
Securities to be so credited shall be received and credited for such purpose by
the Trustee at the redemption price for such Securities, as specified in the
Securities so to be redeemed, for redemption through operation of the sinking
fund and the amount of such sinking fund payment shall be reduced accordingly.

     SECTION 12.3. REDEMPTION OF SECURITIES FOR SINKING FUND.

     Not less than 60 days prior to each sinking fund payment date for any
series of Securities, CNAF will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for such
Securities pursuant to the terms of such Securities, the portion thereof, if
any, which is to be satisfied by payment of cash in the currency in which the
Securities of such series are payable (except as provided pursuant to Section
3.1) and the portion


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<PAGE>
thereof, if any, which is to be satisfied by delivering and crediting Securities
pursuant to Section 12.2 and will also deliver to the Trustee any Securities to
be so delivered. Such Certificate shall be irrevocable and upon its delivery
CNAF shall be obligated to make the cash payment or payments therein referred
to, if any, on or before the succeeding sinking fund payment date. In the case
of the failure of CNAF to deliver such Certificate (or, as required by this
Junior Indenture, the Securities and coupons, if any, specified in such
Certificate), the sinking fund payment due on the succeeding sinking fund
payment date for such series shall be paid entirely in cash and shall be
sufficient to redeem the principal amount of the Securities of such series
subject to a mandatory sinking fund payment without the right to deliver or
credit securities as provided in Section 12.2 and without the right to make the
optional sinking fund payment with respect to such series at such time.

     Any sinking fund payment or payments (mandatory or optional) made in cash
plus any unused balance of any preceding sinking fund payments made with respect
to the Securities of any particular series shall be applied by the Trustee (or
by CNAF if CNAF is acting as its own Paying Agent) on the sinking fund payment
date on which such payment is made (or, if such payment is made before a sinking
fund payment date, on the sinking fund payment date immediately following the
date of such payment) to the redemption of Securities of such series at the
redemption price specified in such Securities with respect to the sinking fund.
Any sinking fund moneys not so applied or allocated by the Trustee (or by CNAF
if CNAF is acting as its own Paying Agent, segregated and held in trust as
provided in Section 10.3) for such series and together with such payment (or
such amount so segregated) shall be applied in accordance with the provisions of
this Section 12.3. Any and all sinking fund moneys with respect to the
Securities of any particular series held by the Trustee (or if CNAF is acting as
its own Paying Agent, segregated and held in trust as provided in Section 10.3)
on the last sinking fund payment date with respect to Securities of such series
and not held for the payment or redemption of particular Securities of such
series shall be applied by the Trustee (or by CNAF if CNAF is acting as its own
Paying Agent), together with other moneys, if necessary, to be deposited (or
segregated) sufficient for the purpose, to the payment of the principal of the
Securities of such series at Maturity. The Trustee shall select the Securities
to be redeemed upon such sinking fund payment date in the manner specified in
Section 11.3 and cause notice of the redemption thereof to be given in the name
of and at the expense of CNAF in the manner provided in Section 11.4. Such
notice having been duly given, the redemption of such Securities shall be made
upon the terms and in the manner stated in Section 11.6. On or before each
sinking fund payment date, CNAF shall pay to the Trustee (or, if CNAF is acting
as its own Paying Agent, CNAF shall segregate and hold in trust as provided in
Section 10.3) in cash a sum in the currency in which Securities of such series
are payable (except as provided pursuant to Section 3.1) equal to the principal
and any interest accrued to the redemption date for Securities or portions
thereof to be redeemed on such sinking fund payment date pursuant to this
Section 12.3.

     Neither the Trustee nor CNAF shall redeem any Securities of a series with
sinking fund moneys or mail any notice of redemption of Securities of such
series by operation of the sinking fund for such series during the continuance
of a default in payment of interest, if any, on any Securities of such series or
of any Event of Default (other than an Event of Default occurring as a
consequence of this paragraph) with respect to the Securities of such series,
except that if the notice of redemption shall have been provided in accordance
with the provisions hereof, the Trustee (or CNAF if CNAF is then acting as its
own Paying Agent) shall redeem such Securities


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if cash sufficient for that purpose shall be deposited with the Trustee (or
segregated by CNAF) for that purpose in accordance with the terms of this
Article Twelve. Except as aforesaid, any moneys in the sinking fund for such
series at the time when any such default or Event of Default shall occur and any
moneys thereafter paid into such sinking fund shall, during the continuance of
such default or Event of Default, be held as security for the payment of the
Securities and coupons, if any, of such series; provided, however, that in case
such default or Event of Default shall have been cured or waived herein, such
moneys shall thereafter be applied on the next sinking fund payment date for the
Securities of such series on which such moneys may be applied pursuant to the
provisions of this Section 12.3.

                                  ARTICLE XIII.
                           SUBORDINATION OF SECURITIES

     SECTION 13.1. SECURITIES SUBORDINATE TO SENIOR DEBT.

     CNAF covenants and agrees, and each Holder of a Security, by its acceptance
thereof, likewise covenants and agrees, that, to the extent and in the manner
hereinafter set forth in this Article Thirteen, the payment of the principal of
(and premium, if any) and interest (including any Additional Interest and
Additional Sums) on each and all of the Securities are hereby expressly made
subordinate and subject in right of payment to the prior payment in full of all
amounts then due and payable in respect of all Senior Debt.

     SECTION 13.2. PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.

     In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to CNAF (each such event, if any, herein sometimes
referred to as a "Proceeding"), then the holders of Senior Debt shall be
entitled to receive payment in full of principal of (and premium, if any) and
interest, if any, on such Senior Debt, or provision shall be made for such
payment in cash or cash equivalents or otherwise in a manner satisfactory to the
holders of Senior Debt, before the Holders of the Securities are entitled to
receive or retain any payment or distribution of any kind or character, whether
in cash, property or securities (including any payment or distribution which may
be payable or deliverable by reason of the payment of any other Debt of CNAF
(including any series of the Securities) subordinated to the payment of the
Securities, such payment or distribution being hereinafter referred to as a
"Junior Subordinated Payment"), on account of principal of (or premium, if any)
or interest (including any Additional Interest and Additional Sums) on the
Securities and to that end the holders of Senior Debt shall be entitled to
receive, for application to the payment thereof, any payment or distribution of
any kind or character, whether in cash, property or securities, including any
Junior Subordinated Payment, which may be payable or deliverable in respect of
the Securities in any such Proceeding.

     In the event that, notwithstanding the foregoing provisions of this
Section, the Trustee or the Holder of any Security shall have received any
payment or distribution of assets of CNAF of any kind or character, whether in
cash, property or securities, including any Junior Subordinated Payment, before
all Senior Debt is paid in full or payment thereof is provided for in cash or
cash equivalents or otherwise in a manner satisfactory to the holders of Senior
Debt, and if such fact


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shall, at or prior to the time of such payment or distribution, have been made
known to the Trustee or, as the case may be, such Holder, then and in such event
such payment or distribution shall be paid over or delivered forthwith to the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee, agent
or other Person making payment or distribution of assets of CNAF for application
to the payment of all Senior Debt remaining unpaid, to the extent necessary to
pay all Senior Debt in full, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Debt.

     For purposes of this Article only, the words "any payment or distribution
of any kind or character, whether in cash, property or securities" shall not be
deemed to include shares of stock of CNAF as reorganized or readjusted, or
securities of CNAF or any other corporation provided for by a plan of
reorganization or readjustment which securities are subordinated in right of
payment to all then outstanding Senior Debt to substantially the same extent as
the Securities are so subordinated as provided in this Article Thirteen. The
consolidation of CNAF with, or the merger of CNAF into, another Person or the
liquidation or dissolution of CNAF following the sale of all or substantially
all of its properties and assets as an entirety to another Person or the
liquidation or dissolution of CNAF following the sale of all or substantially
all of its properties and assets as an entirety to another Person upon the terms
and conditions set forth in Article Eight shall not be deemed a Proceeding for
the purposes of this Section 13.2 if the Person formed by such consolidation or
into which CNAF is merged or the Person which acquires by sale such properties
and assets as an entirety, as the case may be, shall, as a part of such
consolidation, merger, or sale comply with the conditions set forth in Article
Eight.

     SECTION 13.3. PRIOR PAYMENT TO SENIOR DEBT UPON ACCELERATION OF SECURITIES.

     In the event that any Securities are declared due and payable before their
Stated Maturity, then and in such event the holders of the Senior Debt
outstanding at the time such Securities so become due and payable shall be
entitled to receive payment in full of all amounts due on or in respect of such
Senior Debt (including any amounts due upon acceleration), or provision shall be
made for such payment in cash or cash equivalents or otherwise in a manner
satisfactory to the holders of Senior Debt, before the Holders of the Securities
are entitled to receive any payment or distribution of any kind or character,
whether in cash, properties or securities (including any Junior Subordinated
Payment) by CNAF on account of the principal of (or premium, if any) or interest
(including any Additional Interest and Additional Sums) on the Securities or on
account of the purchase or other acquisition of Securities by CNAF or any
Subsidiary; provided, however, that nothing in this Section 13.3 shall prevent
the satisfaction of any sinking fund payment in accordance with this Junior
Indenture or as otherwise specified as contemplated by Section 3.1 for the
Securities of any series by delivering and crediting pursuant to Section 12.2 or
as otherwise specified as contemplated by Section 3.1 for the Securities of any
series Securities which have been acquired (upon redemption or otherwise) prior
to such declaration of acceleration.

     In the event that, notwithstanding the foregoing, CNAF shall make any
payment to the Trustee or the Holder of any Security prohibited by the foregoing
provisions of this Section, and if such fact shall, at or prior to the time of
such payment, have been made known to the Trustee


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or, as the case may be, such Holder, then and in such event such payment shall
be paid over and delivered forthwith to CNAF.

     The provisions of this Section 13.3 shall not apply to any payment with
respect to which Section 13.2 would be applicable.

     SECTION 13.4. NO PAYMENT WHEN SENIOR DEBT IN DEFAULT.

     (a) In the event and during the continuation of any default in the payment
of principal of (or premium, if any) or interest on any Senior Debt, or in the
event that any event of default with respect to any Senior Debt shall have
occurred and be continuing and shall have resulted in such Senior Debt becoming
or being declared due and payable prior to the date on which it would otherwise
have become due and payable, unless and until such event of default shall have
been cured or waived or shall have ceased to exist and such acceleration shall
have been rescinded or annulled, or (b) in the event any proceeding shall be
pending with respect to any such default in payment or such event or default,
then no payment or distribution of any kind or character, or defeasance, whether
in cash, properties or securities (including any Junior Subordinated Payment)
shall be made by CNAF on account of principal of (or premium, if any) or
interest (including any Additional Interest), if any, on the Securities
provided, however, that nothing in this Section shall prevent the satisfaction
of any sinking fund payment in accordance with this Junior Indenture or as
otherwise specified as contemplated by Section 3.1 for the Securities of any
series by delivering and crediting pursuant to Section 12.2 or as otherwise
specified as contemplated by Section 3.1 for the Securities of any series
Securities which have been acquired (upon redemption or otherwise) prior to such
default in payment or event of default.

     In the event that, notwithstanding the foregoing, CNAF shall make any
payment to the Trustee or the Holder of any Security prohibited by the foregoing
provisions of this Section, and if such fact shall, at or prior to the time of
such payment, have been made known to the Trustee or, as the case may be, such
Holder, then and in such event such payment shall be paid over and delivered
forthwith to CNAF.

     The provisions of this Section 13.3 shall not apply to any payment with
respect to which Section 13.2 would be applicable.

     SECTION 13.5. PAYMENT PERMITTED IF NO DEFAULT.

     Nothing contained in this Article Thirteen or elsewhere in this Junior
Indenture or in any of the Securities shall prevent (a) CNAF, at any time except
during the pendency of any Proceeding referred to in Section 13.2 or under the
conditions described in Sections 13.3 and 13.4, from making payments at any time
of principal of (and premium, if any) or interest (including Additional Interest
and Additional Sums) on the Securities, or (b) the application by the Trustee of
any money or Government Obligations deposited with it hereunder to the payment
of or on account of the principal of (and premium, if any) or interest
(including any Additional Interest and Additional Sums) on the Securities or the
retention of such payment by the Holders, if, at the time of such application by
the Trustee, it did not have knowledge that such payment would have been
prohibited by the provisions of this Article Thirteen.


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     SECTION 13.6. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR DEBT.

     Subject to the payment in full of all Senior Debt, or the provision for
such payment in cash or cash equivalents or otherwise in a manner satisfactory
to the holders of Senior Debt, the Holders of the Securities shall be subrogated
to the extent of the payments or distributions made to the holders of such
Senior Debt pursuant to the provisions of this Article Thirteen (equally and
ratably with the holders of all indebtedness of CNAF which by its express terms
is subordinated to Senior Debt of CNAF to the same extent as the Securities are
subordinated to the Senior Debt and is entitled to like rights of subrogation by
reason of any payments or distributions made to holders of such Senior Debt) to
the rights of the holders of such Senior Debt to receive payments and
distributions of cash, property and securities applicable to the Senior Debt
until the principal of (and premium, if any) and interest on the Securities
shall be paid in full. For purposes of such subrogation or assignment, no
payments or distributions to the holders of the Senior Debt of any cash,
property or securities to which the Holders of the Securities or the Trustee
would be entitled except for the provisions of this Article, and no payments
over pursuant to the provisions of this Article to the holders of Senior Debt by
Holders of the Securities or the Trustee, shall, as among CNAF, its creditors
other than holders of Senior Debt, and the Holders of the Securities, be deemed
to be a payment or distribution by CNAF to or on account of the Senior Debt.

     SECTION 13.7. PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS.

     The provisions of this Article Thirteen are and are intended solely for the
purpose of defining the relative rights of the Holders of the Securities on the
one hand and the holders of Senior Debt on the other hand. Nothing contained in
this Article or elsewhere in this Junior Indenture or in the Securities is
intended to or shall (a) impair, as between CNAF and the Holders of the
Securities, the obligations of CNAF, which are absolute and unconditional, to
pay to the Holders of the Securities the principal of (and premium, if any) and
interest (including any Additional Interest and Additional Sums) on the
Securities as and when the same shall become due and payable in accordance with
their terms; or (b) affect the relative rights against CNAF of the Holders of
the Securities and creditors of CNAF other than their rights in relation to the
holders of Senior Debt; or (c) prevent the Trustee or the Holder of any Security
from exercising all remedies otherwise permitted by applicable law upon default
under this Junior Indenture, including, without limitation, filing and voting
claims in any Proceeding, subject to the rights, if any, under this Article
Thirteen of the holders of Senior Debt to receive cash, property and securities
otherwise payable or deliverable to the Trustee or such Holder.

     SECTION 13.8. TRUSTEE TO EFFECTUATE SUBORDINATION.

     Each Holder of a Security by his or her acceptance thereof authorizes and
directs the Trustee on his or her behalf to take such action as may be necessary
or appropriate to acknowledge or effectuate the subordination provided in this
Article and appoints the Trustee his or her attorney-in-fact for any and all
such purposes.


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     SECTION 13.9. NO WAIVER OF SUBORDINATION PROVISIONS.

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

     Without in any way limiting the generality of the immediately preceding
paragraph, the holders of Senior Debt may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article
Thirteen or the obligations hereunder of the Holders of the Securities to the
holders of Senior Debt, do any one or more of the following: (i) change the
manner, place or terms of payment or extend the time of payment of, or renew or
alter, Senior Debt, or otherwise amend or supplement in any manner Senior Debt
or any instrument evidencing the same or any agreement under which Senior Debt
is outstanding; (ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Debt; (iii) release any Person
liable in any manner for the collection of Senior Debt; and (iv) exercise or
refrain from exercising any rights against CNAF and any other Person.

     SECTION 13.10. NOTICE TO TRUSTEE.

     CNAF shall give prompt written notice to the Trustee of any fact known to
CNAF which would prohibit the making of any payment to or by the Trustee in
respect of the Securities. Notwithstanding the provisions of this Article
Thirteen or any other provision of this Junior Indenture, the Trustee shall not
be charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee in respect of the Securities, unless
and until the Trustee shall have received written notice thereof from CNAF or a
holder of Senior Debt or from any trustee, agent or representative therefor
(whether or not the facts contained in such notice are true); provided, however,
that if the Trustee shall not have received the notice provided for in this
Section 13.10 at least two Business Days prior to the date upon which by the
terms hereof any monies may become payable for any purpose (including, without
limitation, the payment of the principal of (and premium, if any) or interest
(including any Additional Interest) on any Security), then, anything herein
contained to the contrary notwithstanding, the Trustee shall have full power and
authority to receive such monies and to apply the same to the purpose for which
they were received and shall not be affected by any notice to the contrary which
may be received by it within two Business Days prior to such date.

     SECTION 13.11. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING
AGENT.

     Upon any payment or distribution of assets of CNAF referred to in this
Article Thirteen, the Trustee, subject to the provisions of Article Six, and the
Holders of the Securities shall be entitled to rely upon any order or decree
entered by any court of competent jurisdiction in which a Proceeding is pending,
or a certificate of the trustee in bankruptcy, receiver, liquidating trustee,


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custodian, assignee for the benefit of creditors, agent or other Person making
such payment or distribution, delivered to the Trustee or to the Holders of
Securities, for the purpose of ascertaining the Persons entitled to participate
in such payment or distribution, the holders of the Senior Debt and other
indebtedness of CNAF, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent thereto or to
this Article Thirteen.

     SECTION 13.12. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR DEBT.

     The Trustee, in its capacity as trustee under this Junior Indenture, shall
not be deemed to owe any fiduciary duty to the holders of Senior Debt and shall
not be liable to any such holders if it shall in good faith mistakenly pay over
or distribute to Holders of Securities or to CNAF or to any other Person cash,
property or securities to which any holders of Senior Debt shall be entitled by
virtue of this Article or otherwise.

     SECTION 13.13. RIGHTS OF TRUSTEE AS HOLDER OF SENIOR DEBT; PRESERVATION OF
TRUSTEE'S RIGHTS.

     The Trustee in its individual capacity shall be entitled to all the rights
set forth in this Article Thirteen with respect to any Senior Debt which may at
any time be held by it, to the same extent as any other holder of Senior Debt,
and nothing in this Junior Indenture shall deprive the Trustee of any of its
rights as such holder. The Trustee's rights under Section 6.7 and Section 5.6
are not subject to the provisions of this Article.

     SECTION 13.14. ARTICLE APPLICABLE TO PAYING AGENTS.

     In case at any time any Paying Agent other than the Trustee shall have been
appointed by CNAF and be then acting hereunder, the term "Trustee" as used in
this Article Thirteen shall in such case (unless the context otherwise requires)
be construed as extending to and including such Paying Agent within its meaning
as fully for all intents and purposes as if such Paying Agent were named in this
Article in addition to or in place of the Trustee.

     SECTION 13.15. CERTAIN CONVERSIONS OR EXCHANGES.

     For the purposes of this Article Thirteen only, (a) the issuance and
delivery of junior securities upon conversion or exchange of Securities shall
not be deemed to constitute a payment or distribution on account of the
principal of (or premium, if any) or interest (including any Additional Interest
and Additional Sums) on Securities and (b) the payment, issuance or delivery of
cash, property or securities (other than junior securities) upon conversion or
exchange of a Security shall be deemed to constitute payment on account of the
principal of such security. For the purposes of this Section 13.15, the term
"junior securities" means (i) shares of any capital stock of any class of CNAF
or (ii) securities of CNAF which are subordinated in right of payment to all
Senior Debt which may be outstanding at the time of issuance or delivery of such
securities to the same extent as, or to a greater extent than, the Securities
are so subordinated as provided in this Article Thirteen.

                                     * * * *


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

     IN WITNESS WHEREOF, the parties hereto have caused this Junior Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.

                                        CNA FINANCIAL CORPORATION


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

Attest:

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


                                        J. P. MORGAN TRUST COMPANY,
                                        NATIONAL ASSOCIATION as Junior
                                        Indenture Trustee


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


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