Exhibit 4.12


                      LITCHFIELD FINANCIAL CORPORATION

                                       AND

                              THE BANK OF NEW YORK,

                                   AS TRUSTEE

                          JUNIOR SUBORDINATED INDENTURE

                            DATED AS OF MAY 19, 1999

                         JUNIOR SUBORDINATED DEBENTURES











                                TABLE OF CONTENTS
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                                                                                                         Page

                                    ARTICLE 1
                                   Definitions
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Section 1.01.        Definitions..................................................................................2

                                    ARTICLE 2

                    Issue Description, Terms, Execution Registration and Exchange of Debentures

Section 2.01.        Designation, Terms, Amount, Authentication and Delivery
                     of Debentures................................................................................8
Section 2.02.        Form of Debenture and Trustee's Certificate.................................................11
Section 2.03.        Date and Denominations of Debentures and Provisions for Payment of
                     Principal, Premium and Interest.............................................................11
Section 2.04.        Execution of Debentures.....................................................................12
Section 2.05.        Exchange of Debentures......................................................................14
Section 2.06.        Temporary Debentures........................................................................15
Section 2.07.        Mutilated, Destroyed, Lost or Stolen Debentures.............................................15
Section 2.08.        Cancellation of Surrendered Debentures......................................................16
Section 2.09.        Provisions of Indenture and Debentures for Sole Benefit of Parties
                     and Debentureholders........................................................................16
Section 2.10.        Appointment of Authenticating Agent.........................................................16
Section 2.11.        Global Debentures...........................................................................17
Section 2.12.        Cusip Numbers...............................................................................19

                                    ARTICLE 3

              Redemption of Debentures and Sinking Fund Provisions

Section 3.01.        Redemption..................................................................................19
Section 3.02.        Notice of Redemption........................................................................19
Section 3.04.        Sinking Funds for Debentures................................................................21
Section 3.05.        Satisfaction of Sinking Fund Payments with Debentures.......................................21
Section 3.06.        Redemption of Debentures for Sinking Fund...................................................22

                                    ARTICLE 4

                       Particular Covenants of the Company

Section 4.01.        Payment of Principal of (And Premium, If Any)
                     and Interest on Debentures..................................................................22

                                        i

<PAGE>



Section 4.02.        Maintenance of Office or Agent for Payment of Debentures,
                     Designation of Office or Agency for Payment, Registration,
                     Transfer and Exchange of Debentures.........................................................22
Section 4.03.        Duties of Paying Agent; Company as Payment Agent; and Holding
                     Sums in Trust...............................................................................22
Section 4.04.        Appointment to Fill Vacancy in Office of Trustee............................................23

                                    ARTICLE 5

                         Debentureholders Lists and Reports by the Company and the Trustee

Section 5.01.        Company to Furnish Trustee Information as to Names and
                     Addresses of Debentureholders...............................................................23
Section 5.02.        Trustee to Preserve Information as to Names and Addresses of
                     Debentureholders............................................................................24
Section 5.03.        Annual and Other Reports to Be Filed by Company with the Trustee............................25
Section 5.04.        Trustee to Transmit Annual Report to Debentureholders.......................................26

                                    ARTICLE 6

                         Remedies of the Trustee and Debentureholders on Event of Default

Section 6.01.        Events of Default Defined...................................................................26
Section 6.02.        Covenant of Company to Pay to Trustee Whole Amount Due
                     on Debentures on Default in Payment of Interest or Principal
                     (And Premiums, If Any)......................................................................29
Section 6.03.        Application of Moneys Collected by Trustee..................................................30
Section 6.04.        Limitation on Suits by Holders of Debentures................................................31
Section 6.05.        Remedies Cumulative; Delay or Omission in Exercise of Rights
                     Not Waiver of Default.......................................................................32
Section 6.06.        Rights of Holders of Majority in Principal Amount of Debentures
                     to Direct Trustee and to Waive Defaults.....................................................32
Section 6.07.        Trustee to Give Notice of Defaults Known to It, but May Withhold
                     in Certain Circumstances....................................................................33
Section 6.08.        Requirements of an Undertaking to Pay Costs in Certain Suits
                     under Indenture or Against Trustee..........................................................33

                                    ARTICLE 7

                             Concerning the Trustee

Section 7.01.        Upon Event of Default Occurring and Continuing, Trustees
                     Shall Exercise Powers Vested in It, and Use Same Degree of Care
                     and Skill in Their Exercise, as Prudent Individual Would Use................................34
Section 7.02.        Certain Rights of the Trustee...............................................................35

                                       ii





Section 7.03.        Trustee Not Liable for Recitals in Indenture or in Debentures...............................37
Section 7.04.        Trustee, Paying Agent or Debenture Registrar May Own Debentures.............................37
Section 7.05.        Moneys Received by Trustee to Be Held in Trust Without Interest.............................37
Section 7.06.        Trustee Entitled to Compensation, Reimbursement and Indemnity...............................38
Section 7.07.        Right of Trustee to Rely on Certificate of Officers of Company
                     Where No Other Evidence Specifically Prescribed.............................................38
Section 7.08.        Disqualification; Conflicting Interests.....................................................39
Section 7.09.        Requirements for Eligibility of Trustee.....................................................39
Section 7.10.        Resignation of Trustee and Appointment of Successor.........................................39
Section 7.11.        Acceptance by Successor to Trustee..........................................................41
Section 7.12.        Successor to Trustee by Merger, Consolidation or Succession
                     to Business.................................................................................42
Section 7.13.        Preferential Collection of Claims Against the Company.......................................42

                                    ARTICLE 8

                            Concerning the Debentures

Section 8.01.        Evidence of Action by Debentureholders......................................................42
Section 8.02.        Proof of Execution of Instruments and of Holding of Debentures..............................43
Section 8.03.        Who May Be Deemed Owners of Debentures......................................................43
Section 8.04.        Debentures Owned by the Company or Controlled or Controlling
                     Companies Disregarded for Certain Purposes..................................................43
Section 8.05.        Instruments Executed by Debentureholders Bind Future Holders................................44

                                    ARTICLE 9

                             Supplemental Indentures

Section 9.01.        Purposes for Which Supplemental Indenture May Be Entered into
                     Without Consent of Debentureholders.........................................................44
Section 9.02.        Modification of Indenture with Consent of Debentureholders..................................46
Section 9.03.        Effect of Supplemental Indentures...........................................................47
Section 9.04.        Debentures May Bear Notation of Changes by Supplemental
                     Indentures..................................................................................47
Section 9.05.        Opinion of Counsel..........................................................................47

                                       iii





                                   ARTICLE 10

                    Consolidation, Merger, Sale or Conveyance

Section 10.01.         Company May Consolidate, Etc. on Certain Terms............................................48
Section 10.02.         Successor Corporation Substituted.........................................................48
Section 10.03.         Opinion of Counsel........................................................................48

                                   ARTICLE 11

            Stisfaction and Discharge of Indenture; Unclaimed Moneys

Section 11.01.       Satisfaction and Discharge of Indenture.....................................................48
Section 11.02.       Application by Trustee of Funds Deposited for Payment of
                     Debentures..................................................................................51
Section 11.03.       Repayment of Moneys Held by the Paying Agent................................................51
Section 11.04.       Repayment of Moneys Held by the Trustee.....................................................51
Section 11.05.       Indemnification Relating to Governmental Obligations........................................51

                                   ARTICLE 12

                          Imunity of Incorporators, Stockholders, Officers and Directors

Section 12.01.       Incorporators, Stockholders, Officers and Directors of Company
                     Exempt from Individual Liability............................................................52

                                   ARTICLE 13

                             Micellaneous Provisions

Section 13.01.       Successors and Assigns of Company Bound by Indenture........................................52
Section 13.02.       Acts of Board, Committee or Officer of Successor Company Valid..............................52
Section 13.03.       Surrender of Powers of the Company..........................................................53
Section 13.04.       Required Notices or Demands May Be Served by Mail...........................................53
Section 13.05.       Indenture and Debentures to Be Construed in Accordance with
                     Laws of the State of New York...............................................................54
Section 13.06.       Officer's Certificate and Opinion of Counsel to Be Furnished
                     upon Application or Demands by Company; Statements to Be
                     Included in Each Certificate or Opinion with Respect to Compliance
                     with Condition or Covenant..................................................................53
Section 13.07.         Payments Due on Sundays or Holidays.......................................................53
Section 13.08.       Provisions Required by Trust Indenture Act of 1939 to Control...............................54
Section 13.09.       Indenture May Be Executed by its Counterparts...............................................54
Section 13.10.       Separability of Indenture Provisions........................................................54
Section 13.11.       Assignment by Company to a Subsidiary or Affiliate..........................................54

                                       iv





Section 13.12.       Holders of Preferred Securities as Third Party Beneficiaries
                     of the Indenture; Holders of Preferred Securities May Institute Legal
                     Proceedings Against the Company in Certain Cases............................................54

                                   ARTICLE 14

                           Sbordination of Debentures

Section 14.01.       Agreement to Subordinate....................................................................55
Section 14.02.       Default on Senior Debt......................................................................55
Section 14.03.       Liquidation; Dissolution; Bankruptcy........................................................56
Section 14.04.       Subrogation of Debentures...................................................................57
Section 14.05.       Authorization by Debentureholders...........................................................58
Section 14.06.       Notice to Trustee...........................................................................58
Section 14.07.       Trustee's Relation to Senior Debt...........................................................59
Section 14.08.       No Impairment to Subordination..............................................................59
Section 14.09.       Article Applicable to Paying Agents.........................................................60
Section 14.10.       Trust Moneys Not Subordinated...............................................................60

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                                        v







         THIS JUNIOR SUBORDINATED INDENTURE, is dated as of the 19th day of May,
1999, between Litchfield Financial Corporation, a corporation duly organized and
existing  under  the  laws of The  Commonwealth  of  Massachusetts  (hereinafter
sometimes  referred to as the  "Company"),  and The Bank of New York, a New York
banking  corporation,  as  Trustee  (hereinafter  sometimes  referred  to as the
"Trustee"):

         WHEREAS,  for its lawful  corporate  purposes,  the  Company  has fully
authorized  the  execution  and  delivery of this  Indenture  to provide for the
issuance of unsecured junior subordinated debentures (hereinafter referred to as
the "Debentures"),  in an unlimited aggregate principal amount to be issued from
time  to time in one or  more  series  in  accordance  with  the  terms  of this
Indenture,  as registered Debentures without coupons, to be authenticated by the
certificate of the Trustee;

         WHEREAS,  to provide the terms and conditions upon which the Debentures
are to be authenticated,  issued and delivered,  the Company has duly authorized
the execution of this Indenture;

         WHEREAS,  the Debentures and the  certificate of  authentication  to be
borne  by  the  Debentures  (the  "Certificate  of  Authentication")  are  to be
substantially  in such forms as may be  approved by the Board of  Directors  (as
defined below) or set forth in any indenture supplemental to this Indenture; and

         WHEREAS,  all acts and things  necessary to make the Debentures  issued
pursuant hereto, when executed by the Company and authenticated and delivered by
the Trustee in accordance with the terms of this Indenture,  the valid,  binding
and legal  obligations of the Company,  and to constitute a valid  indenture and
agreement  according to its terms,  have been done and performed or will be done
and  performed  prior to the issuance of such  Debentures,  and the execution of
this Indenture has been and the issuance hereunder of the Debentures has been or
will be prior to issuance in all respects duly authorized,  and the Company,  in
the exercise of the legal right and power in it vested,  executes this Indenture
and proposes to make, execute, issue and deliver the Debentures;

         NOW, THEREFORE, THIS INDENTURE WITNESSETH:

         That in order to  declare  the  terms  and  conditions  upon  which the
Debentures  are  and  are to be  authenticated,  issued  and  delivered,  and in
consideration  of the  premises and of the  acquisition  and  acceptance  of the
Debentures  by the holders  thereof,  the Company  covenants and agrees with the
Trustee,  for the equal and proportionate  benefit (subject to the provisions of
this  Indenture) of the respective  holders from time to time of the Debentures,
without any discrimination, preference or priority of any one Debenture over any
other by reason of priority in the time of issue,  sale or negotiation  thereof,
or otherwise, except as provided herein, as follows:


                                        1





                                    ARTICLE 1
                                   DEFINITIONS

         SECTION 1.01. DEFINITIONS. The terms defined in this Section (except as
in this Indenture  otherwise  expressly provided or unless the context otherwise
requires)  for all purposes of this  Indenture,  any  resolution of the Board of
Directors of the Company and of any indenture supplemental hereof shall have the
respective  meanings  specified  in this  Section.  All other terms used in this
Indenture which are defined in the Trust  Indenture Act of 1939, as amended,  or
which are by reference  in such Act defined in the  Securities  Act of 1933,  as
amended  (except as herein  otherwise  expressly  provided or unless the context
otherwise  requires),  shall have the  meanings  assigned  to such terms in said
Trust  Indenture Act and in said  Securities Act as in force at the date of this
instrument.

         "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,  no Litchfield  Capital
Trust to which Debentures have been issued shall be deemed to be an Affiliate of
the  Company.  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 an  authenticating  agent with respect to
all or any of the  series  of  Debentures,  as the case may be,  appointed  with
respect  to all or any  series  of the  Debentures,  as the case may be,  by the
Trustee pursuant to Section 2.10.

         "Board of  Directors"  means the Board of Directors of the Company,  or
any committee of such Board duly authorized to act hereunder.

         "Board  Resolution" means a copy of one or more resolutions,  certified
by the  secretary or an assistant  secretary of the Company to have been adopted
or consented  to by the Board of  Directors  and to be in full force and effect,
and delivered to the Trustee.

         "Business Day," with respect to any series of Debentures, means any day
other than (i) a Saturday or a Sunday, (ii) a day on which banking  institutions
in the  Borough  of  Manhattan,  The  City  and  State  of New  York or  Boston,
Massachusetts  are authorized or obligated by law or executive order to close or
(iii) a day on which the Corporate Trust Office of the Trustee, or, with respect
to Debentures of a series  initially  issued to a Litchfield  Capital Trust, the
principal  corporate  trust  office of the  Property  Trustee  under the related
Declaration of Trust, is closed for business.

     "Certificate"  means  a  certificate  signed  by  the  principal  executive
officer,  the principal financial officer,  the principal  accounting officer or
the  Treasurer  of the  Company.  The  Certificate  need  not  comply  with  the
provisions of Section 13.06.


                                        2





         "Common Securities" means the common undivided  beneficial interests in
the assets of the applicable Litchfield Capital Trust.

         "Company" means Litchfield  Financial  Corporation,  a corporation duly
organized and existing under the laws of The Commonwealth of Massachusetts, and,
subject to the  provisions  of Article 10, shall also include its  successor and
assigns.

         "Corporate  Trust  Office"  means the office of the Trustee at which at
any  particular   time  its  corporate   trust  business  shall  be  principally
administered,  which office at the date of the  execution  of this  Indenture is
located  at 101  Barclay  Street,  Floor  21 West,  New  York,  New York  10286,
Attention: Corporate Trust Trustee Administration.

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

         "Debenture Register" has the meaning assigned in Section 2.05(b).

         "Debenture Registrar" has the meaning assigned in Section 2.05(b).

         "Debentureholder,"  "holder of  Debentures,"  "registered  holder,"  or
other  similar  term,  means the  person  or  persons  in whose  name or names a
particular  Debenture  shall be  registered on the books of the Company kept for
the purpose in accordance with the terms of this Indenture.

         "Debt" means,  with respect to any Person at any date of  determination
(without  duplication),  (i) all indebtedness of such Person for borrowed money,
(ii) all  obligations 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) all  obligations of such
Person in respect of letters of credit or bankers'  acceptances or other similar
instruments (or reimbursement obligations thereto) issued on the account of such
person,  (iv) all obligations of such person to pay the deferred  purchase price
of property or services,  except Trade  Payables,  (v) all  obligations  of such
Person as lessee under capitalized  leases, (vi) all Debt of others secured by a
Lien on any asset of such  Person,  whether  or not such Debt is assumed by such
Person; provided that, for purposes of determining the amount of any Debt of the
type  described  in this clause (vi),  if recourse  with respect to such Debt is
limited to such asset, the amount of such Debt shall be limited to the lesser of
the fair market  value of such asset or the amount of such Debt,  (vii) all Debt
of others  Guaranteed  by such Person to the extent such Debt is  Guaranteed  by
such Person, and (viii) to the extent not otherwise included in this definition,
all  obligations  of such Person for claims in respect of  derivative  products,
including  interest rate,  foreign exchange rate and commodity  prices,  forward
contracts, options, swaps, collars and similar arrangements.

         "Declaration  of Trust" means the Amended and Restated  Declaration  of
Trust of a Litchfield  Capital Trust, if any,  specified in the applicable Board
Resolution  or  supplemental  indenture  establishing  a  particular  series  of
Debentures pursuant to Section 2.01 hereof.


                                        3





         "Default" means any event,  act or condition which with notice or lapse
of time, or both, would constitute an Event of Default hereunder.

         "Depositary"  means with respect to Debentures of any series, for which
the Company shall  determine that such  Debentures will be issued as one or more
Global  Debentures,  The Depository Trust Company,  New York, New York,  another
clearing  agency,  or any successor  registered  as a clearing  agency under the
Exchange Act or other  applicable  statute or regulation,  which,  in each case,
shall be designated by the Company pursuant to either Section 2.01 or 2.11.

         "Event of Default,"  with respect to Debentures of a particular  series
means any event specified in Section 6.01(a),  continued for the period of time,
if any, and the giving of the notice, if any, therein designated.

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

         "Global  Debenture" means, with respect to any series of Debentures,  a
Debenture in the form  prescribed  in Section  2.11  executed by the Company and
delivered  by the Trustee to the  Depositary  or  pursuant  to the  Depositary's
instruction,  all in accordance with the Indenture, which shall be registered in
the name of the Depositary or its nominee.

         "Governmental   Obligations"  means  securities  that  are  (i)  direct
obligations  of the United  States of America  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, the payment of which is unconditionally  guaranteed as a full faith and
credit  obligation by the United States of America,  which,  in either case, 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)  as  custodian  with  respect  to  any  such  Governmental
Obligation  or a  specific  payment  of  principal  of or  interest  on any such
Governmental  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  Governmental  Obligation or the specific payment of principal of
or interest on the Governmental Obligation evidenced by such depository receipt.

         "Guarantee"  means any  obligation,  contingent  or  otherwise,  of any
Person directly or indirectly  guaranteeing  any Debt or other obligation of any
other  Person  and,  without  limiting  the  generality  of the  foregoing,  any
obligation,  direct or indirect,  contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt or other  obligation  of such other  Person  (whether  arising by virtue of
partnership  arrangements,  or by  agreement to keep well,  to purchase  assets,
goods,  securities  or  services,  to  take-or-pay,  or  to  maintain  financial
statement conditions or otherwise) or (ii) entered into for purposes of assuring
in any other manner the obligee of such Debt of other  obligation of the payment
thereof or to protect such obligee  against loss in respect thereof (in whole or
in part);

                                        4





provided that the term "Guarantee" shall not include endorsements for collection
or deposit in the ordinary course of business.  The term  "Guarantee"  used as a
verb has a corresponding meaning.

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

         "Interest  Payment Date" when used with respect to any  installment  of
interest on a Debenture of a particular  series means the date specified in such
Debenture or in a Board Resolution or in an indenture  supplemental  hereto with
respect to such  series as the fixed date on which an  installment  of  interest
with respect to Debentures of that series is due and payable.

         "Lien" means, with respect to any property, any mortgage, lien, pledge,
charge,  security  interest  or  encumbrance  of any  kind  in  respect  of such
property.  For purposes of this  Indenture,  the Company  shall be deemed to own
subject to a Lien any  property  which it has  acquired or holds  subject to the
interest of a vendor or lessor under any  conditional  sale  agreement,  capital
lease or other title retention agreement relating to such property.

         "Litchfield  Capital Trust" means any statutory  business trust created
under the laws of the State of Delaware as  specified  in the  applicable  Board
Resolution  or  supplemental  indenture  establishing  a  particular  series  of
Debentures pursuant to Section 2.01 hereof.

         "Officers'  Certificate" means a certificate signed by the President or
a  Vice  President  and  by  the  Treasurer  or an  Assistant  Treasurer  or the
Comptroller  or an  Assistant  Comptroller  or  the  Secretary  or an  Assistant
Secretary of the Company,  and delivered to the Trustee.  Each such  certificate
shall include the statements provided for in Section 13.06, if and to the extent
required by the provisions thereof.

         "Opinion  of  Counsel"  means an  opinion  in  writing  signed by legal
counsel,  who may be counsel for the Company,  a Litchfield Capital Trust or the
Trustee,  which may be an  employee  of the  Company  but not an  employee  of a
Litchfield Capital Trust or the Trustee, and who shall be reasonably  acceptable
to the Trustee.  Each such opinion shall include the statements  provided for in
Section 13.06, if and to the extent required by the provisions thereof.

         "Outstanding,"  when used with  reference to  Debentures of any series,
subject to the provisions of Section 8.01, means, as of any particular time, all
Debentures of that series theretofore authenticated and delivered by the Trustee
under this Indenture, except (a) Debentures theretofore cancelled by the Trustee
or any paying  agent,  or  delivered  to the  Trustee  or any  paying  agent for
cancellation or which have previously been cancelled; (b) Debentures or portions
thereof  for  the  payment  or  redemption  of  which  moneys  or   Governmental
Obligations in the necessary  amount shall have been deposited in trust with the
Trustee or with any paying agent (other than the Company) or shall have been set
aside and segregated in trust for the holders of such  Debentures by the Company
(if the Company shall act as its own paying agent);  provided,  however, that if
such  Debentures or portions of such  Debentures are to be redeemed prior to the
maturity thereof,  notice of such redemption shall have been given as in Article
3

                                        5





provided,  or  provision  satisfactory  to the Trustee  shall have been made for
giving such  notice;  (c)  Debentures  paid  pursuant to Section  2.07;  and (d)
Debentures in lieu of or in substitution  for which other  Debentures shall have
been  authenticated  and  delivered  pursuant  to the  terms  of  Section  2.07;
provided,  however,  that in  determining  whether the holders of the  requisite
principal  amount of Outstanding  Debentures are present at a meeting of holders
of Debentures for quorum  purposes or have consented to or voted in favor of any
request, demand, authorization, direction, notice, consent, waiver, amendment or
modification  hereunder,  Debentures held for the account of the Company, any of
its subsidiaries or any of its Affiliates shall be disregarded and deemed not to
be  Outstanding,  except  that in  determining  whether  the  Trustee  shall  be
protected  in making  such a  determination  or  relying  upon any such  quorum,
consent or vote, only Debentures which the Trustee actually knows to be so owned
shall be so disregarded.

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

         "Place of  Payment,"  when used with respect to the  Debentures  of any
series,  means the place or places  where the  principal  of and any premium and
interest  on  the  Debentures  of  that  series  are  payable  as  specified  as
contemplated by Section 2.01.

         "Predecessor   Debenture"  of  any  particular  Debenture  means  every
previous  Debenture  evidencing  all or a  portion  of the  same  debt  as  that
evidenced  by  such  particular  Debenture;   and,  for  the  purposes  of  this
definition, any Debenture authenticated and delivered under Section 2.07 in lieu
of a lost,  destroyed or stolen  Debenture  shall be deemed to evidence the same
debt as the lost, destroyed or stolen Debenture.

         "Preferred   Securities"  means  the  preferred  undivided   beneficial
interests in the assets of the applicable Litchfield Capital Trust.

         "Property  Trustee"  means the entity  performing  the  function of the
Property  Trustee  under the  applicable  Declaration  of Trust of a  Litchfield
Capital Trust.

         "Responsible  Officer"  shall  mean,  when  used  with  respect  to the
Trustee,  any officer  within the  corporate  trust  department  of the Trustee,
including any vice  president,  assistant vice president,  assistant  secretary,
assistant  treasurer,  trust  officer or any other  officer of the  Trustee  who
customarily  performs functions similar to those performed by the Persons who at
the time shall be such officers,  respectively,  or to whom any corporate  trust
matter is referred  because of such Person's  knowledge of and familiarity  with
the  particular  subject  and  who  shall  have  direct  responsibility  for the
administration of this Indenture.

         "Securities Act" means the Securities Act of 1933, as amended.


                                        6





         "Security  Exchange"  when used with respect to the  Debentures  of any
series which are held as trust assets of a Litchfield  Capital Trust pursuant to
the  Declaration  of  Trust  of  such  Litchfield   Capital  Trust,   means  the
distribution of the Debentures of such series by such  Litchfield  Capital Trust
in  exchange  for  the  Preferred  Securities  and  Common  Securities  of  such
Litchfield  Capital  Trust  in  dissolution  of such  Litchfield  Capital  Trust
pursuant to the Declaration of Trust of such Litchfield Capital Trust.

         "Senior Debt" means the principal of (and premium, if any) and interest
on all Debt of the Company whether  created,  incurred or assumed before,  on or
after the date of this  Indenture;  provided  that such  Senior  Debt  shall not
include (i) Debt of the Company that,  when incurred and without  respect to any
election under Section 1111(b) of Title 11, U.S. Code, was without recourse, and
(ii) any other Debt of the Company which by the terms of the instrument creating
or evidencing the same is  specifically  designated as being  subordinated to or
pari passu with the Debentures, and in particular the Debentures shall rank pari
passu  with all other  debt  securities  and  guarantees  issued  to any  trust,
partnership  or other entity  affiliated  with the Company  which is a financing
vehicle of the Company in connection with an issuance of preferred securities by
such financing entity.

         "Subsidiary"  means  any  corporation  at  least a  majority  of  whose
outstanding voting stock shall at the time be owned, directly or indirectly,  by
the  Company or by one or more  Subsidiaries  or by the  Company and one or more
Subsidiaries. For the purposes only of this definition of the term "Subsidiary,"
the term "voting stock," as applied to the stock of any  corporation  shall mean
stock of any class or classes having ordinary voting power for the election of a
majority of the  directors  of such  corporation,  other than stock  having such
power only by reason of the occurrence of a contingency.

         "Trade  Payables"  means,  with  respect to any  Person,  any  accounts
payable or any other  indebtedness  or monetary  obligation  to trade  creditors
created, assumed or Guaranteed by such Person or any of its Subsidiaries arising
in the ordinary  course of business in connection  with the acquisition of goods
or services.

         "Trustee"  means The Bank of New York, a New York banking  corporation,
and,  subject to the  provisions of Article 7, shall also include its successors
and  assigns,  and, if at any time there is more than one person  acting in such
capacity hereunder, "Trustee" shall mean each such person. The term "Trustee" as
used with  respect  to a  particular  series of the  Debentures  shall  mean the
trustee with respect to that series.

         "Trust  Indenture  Act," subject to the  provisions of Section 9.01 and
9.02,  means the Trust  Indenture  Act of 1939,  as amended and in effect at the
date of execution of this Indenture.


                                        7





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

         SECTION 2.01. DESIGNATION,  TERMS, AMOUNT,  AUTHENTICATION AND DELIVERY
OF  DEBENTURES.  The  aggregate  principal  amount  of  Debentures  which may be
authenticated and delivered under this Indenture is unlimited.

         The  Debentures may be issued in one or more series up to the aggregate
principal amount of Debentures of that series from time to time authorized by or
pursuant  to  a  Board   Resolution  or  pursuant  to  one  or  more  indentures
supplemental hereto, prior to the initial issuance of Debentures of a particular
series.  Prior to the initial issuance of Debentures of any series,  there shall
be  established  in or  pursuant  to a Board  Resolution,  and set  forth  in an
Officers'  Certificate,  or established in one or more  indentures  supplemental
hereto:

         (1)      the title of the Debentures of the series (which shall
distinguish the Debentures of the series from all other Debentures);

         (2) any limit upon the aggregate  principal amount of the Debentures of
that  series  which may be  authenticated  and  delivered  under this  Indenture
(except for Debentures authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Debentures of that series);

         (3) the date or dates on which the  principal of the  Debentures of the
series is payable and the right to shorten, extend or defer such date or dates;

         (4) the rate or rates at which the  Debentures of the series shall bear
interest or the manner of calculation of such rate or rates, if any;

         (5) the date or dates  from  which  such  interest  shall  accrue,  the
Interest  Payment  Dates on which such interest will be payable or the manner of
determination  of such  Interest  Payment  Dates  and the  record  date  for the
determination  of holders  to whom  interest  is  payable  on any such  Interest
Payment Dates;

         (6) the right, if any, to extend or defer the interest  payment periods
and the duration of such extension;

         (7) the period or periods  within which,  the price or prices at which,
and the terms  and  conditions  upon  which,  Debentures  of the  series  may be
redeemed, in whole or in part, at the option of the Company;

         (8) the  obligation,  if any,  of the  Company  to redeem  or  purchase
Debentures  of the series  pursuant to any sinking fund or analogous  provisions
(including  payments  made  in cash  in  anticipation  of  future  sinking  fund
obligations)  or at the  option of a holder  thereof  and the  period or periods
within  which,  the  price or  prices  at  which,  the  currency  or  currencies
(including

                                        8





currency  unit or  units) in which and the  terms  and  conditions  upon  which,
Debentures  of the series shall be redeemed or  purchased,  in whole or in part,
pursuant to such obligation;

         (9)      any exchangeability, conversion or prepayment provisions of
the Debentures;

         (10) the form of the Debentures of the series including the form of the
Certificate of Authentication for such series;

         (11)  if  other  than  denominations  of $10 or any  integral  multiple
thereof,  the  denominations  in which the  Debentures  of the  series  shall be
issuable;

         (12)  whether  the  Debentures  are  issuable  as  one or  more  Global
Debentures  and, in such case,  the identity of the  Depositary for such series,
the form of any  legend  or  legends  which  shall  be borne by any such  Global
Debentures  in addition to or in lieu of that set forth in Section  2.11 and any
circumstances  in addition  to or in lieu of those set forth in Section  2.11 in
which  any  such  Global  Debentures  may be  exchanged  in whole or in part for
Debentures registered, and any transfer of such Global Debentures in whole or in
part  may be  registered,  in the  name or  names  of  Persons  other  than  the
Depositary for such Global Debentures or a nominee thereof;

         (13) if the  Debentures  of such  series are to be  deposited  as trust
assets  in a  Litchfield  Capital  Trust the name of the  applicable  Litchfield
Capital Trust (which shall  distinguish  such statutory  business trust from all
other Litchfield Capital Trusts) into which the Debentures of such series are to
be deposited as trust assets and the date of its Declaration of Trust;

         (14) the place or places where the principal of (and  premium,  if any)
and interest on the  Debentures  of such series  shall be payable,  the place or
places where the Debentures of such series may be presented for  registration of
transfer or exchange,  and the place or places  where  notices and demands to or
upon the Company in respect of the Debentures of such series may be made;

         (15) if other than U.S. dollars, the currency or currencies  (including
currency  unit or units) in which the  principal  of (and  premium,  if any) and
interest,  if any, on the Debentures of the series shall be payable, or in which
the Debentures of the series shall be denominated;

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

         (17) 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;

         (18) the additions or changes,  if any, to this  Indenture with respect
to the  Debentures  of such series as shall be necessary to permit or facilitate
the issuance of the Debentures of such

                                        9





series in bearer form, registrable or not registrable as to principal, and with
or without interest coupons;

         (19) any index or indices used to  determine  the amount of payments of
principal of and premium, if any, on the Debentures of such series or the manner
in which such amounts will be determined;

         (20)     the appointment of any Paying Agent or Agents for the
Debentures of such series;

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

         (22) any and all other  terms with  respect to the  Debentures  of such
series (and any terms which may be required  by or  advisable  under  applicable
laws or regulations not inconsistent with the terms of this Indenture); and

         (23) an  identification  of any applicable United States Federal income
tax  consequences  with  respect to the  Debentures  of such  series,  including
whether and under what  circumstances the Company will pay additional amounts on
the  Debentures  of such  series  held by a Person  who is not a U.S.  Person in
respect of any tax,  assessment or governmental charge withheld or deducted and,
if so, whether the Company will have the option to redeem the Debentures of such
series rather than pay such additional amounts.

         All  Debentures  of any one  series  shall be  substantially  identical
except as to denomination and except as may otherwise be provided in or pursuant
to any such Board Resolution or in any 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 the Company and
delivered  to  the  Trustee  at or  prior  to  the  delivery  of  the  Officers'
Certificate setting forth the terms of the series.

         SECTION  2.02.  FORM  OF  DEBENTURE  AND  TRUSTEE'S  CERTIFICATE.   The
Debentures of any series and the Trustee's  certificate of  authentication to be
borne by such Debentures  shall be substantially of the tenor and purport as set
forth in one or more  indentures  supplemental  hereto or as provided in a Board
Resolution  and as set  forth in an  Officers'  Certificate,  and may have  such
letters,  numbers  or other  marks of  identification  or  designation  and such
legends or endorsements typewritten,  printed,  lithographed or engraved thereon
as the  Company  may  deem  appropriate  and as are not  inconsistent  with  the
provisions  of this  Indenture,  or as may be required to comply with any law or
with any rule or regulation made pursuant thereto or with any rule or regulation
of any stock exchange or automated  quotation system on which Debentures of that
series may be listed or traded, or to conform to usage.


                                       10





         SECTION 2.03.  DATE AND DENOMINATIONS OF DEBENTURES AND
PROVISIONS FOR PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.  The
Debentures shall be issuable as registered  Debentures and in the  denominations
of $10 or any  integral  multiple  thereof,  subject  to Section  2.01(11).  The
Debentures of a particular  series shall bear interest  payable on the dates and
at the rate  specified  with  respect to that series.  The  principal of and the
interest on the Debentures of any series, as well as any premium thereon in case
of redemption thereof prior to maturity,  shall,  subject to Section 2.01(8) and
(15),  be payable in the coin or currency of the United  States of America which
at the time is legal  tender  for  public  and  private  debt,  at the  Place of
Payment. Each Debenture shall be dated the date of its authentication.  Interest
on the  Debentures  shall be computed on the basis of a 360-day year composed of
twelve 30-day months.

         The interest  installment  on any  Debenture  which is payable,  and is
punctually  paid  or  duly  provided  for,  on any  Interest  Payment  Date  for
Debentures  of that  series  shall  be paid to the  person  in whose  name  said
Debenture (or one or more Predecessor  Debentures) is registered at the close of
business on the regular record date for such interest installment.  In the event
that any  Debenture  of a  particular  series or  portion  thereof is called for
redemption and the  redemption  date is subsequent to a regular record date with
respect to any Interest  Payment Date and prior to such  Interest  Payment Date,
interest on such Debenture will be paid upon  presentation and surrender of such
Debenture as provided in Section 3.03.

         Any interest on any Debenture  which is payable,  but is not punctually
paid or duly  provided for, on any Interest  Payment Date for  Debentures of the
same series (herein called  "Defaulted  Interest")  shall  forthwith cease to be
payable to the registered  holder on the relevant  regular record date by virtue
of having been such holder;  and such  Defaulted  Interest  shall be paid by the
Company, at its election, as provided in clause (1) or clause (2) below:

         (1)  The  Company  may  make  payment  of  any  Defaulted  Interest  on
Debentures to the persons in whose names such  Debentures  (or their  respective
Predecessor  Debentures)  are  registered  at the close of business on a special
record date for the payment of such Defaulted Interest,  which shall be fixed in
the  following  manner:  the Company  shall notify the Trustee in writing of the
amount of Defaulted  Interest proposed to be paid on each such Debenture and the
date of the proposed  payment,  and at the same time the Company  shall  deposit
with the Trustee an amount of money 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 not be more than 15 nor 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  the  Company of such  special  record  date and,  in the name and at the
expense of the  Company,  shall  cause  notice of the  proposed  payment of such
Defaulted  Interest  and the special  record date  therefor to be mailed,  first
class  postage  prepaid,  to each  Debentureholder  at his or her  address as it
appears in the Debenture  Register (as  hereinafter  defined),  not less than 10
days prior to such special record date.  Notice of the proposed  payment of such
Defaulted

                                       11





Interest and the special  record date therefor  having been mailed as aforesaid,
such  Defaulted  Interest  shall  be paid to the  persons  in whose  names  such
Debentures  (or their  Predecessor  Debentures)  are  registered on such special
record date and shall be no longer payable pursuant to the following clause (2).

         (2) The  Company  may make  payment of any  Defaulted  Interest  on any
Debentures in any other lawful manner not inconsistent  with the requirements of
any securities  exchange or automated  quotation system on which such Debentures
may be  listed  or  traded,  and upon such  notice  as may be  required  by such
exchange,  if,  after notice given by the Company to the Trustee of the proposed
payment  pursuant  to this  clause,  such  manner  of  payment  shall be  deemed
practicable by the Trustee.

         Unless  otherwise  set  forth  in a  Board  Resolution  or one or  more
indentures   supplemental  hereto  establishing  the  terms  of  any  series  of
Debentures  pursuant to Section 2.01 hereof,  the term "regular  record date" as
used in this Section with respect to a series of Debentures  with respect to any
Interest Payment Date for such series shall mean either the fifteenth day of the
month  immediately  preceding  the  month  in  which an  Interest  Payment  Date
established for such series pursuant to Section 2.01 hereof shall occur, if such
Interest  Payment Date is the first day of a month, or the last day of the month
immediately  preceding the month in which an Interest  Payment Date  established
for such series  pursuant to Section 2.01 hereof shall occur,  if such  Interest
Payment  Date is the  fifteenth  day of a month,  whether  or not such date is a
Business Day.

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

         SECTION 2.04. EXECUTION OF DEBENTURES. The Debentures shall, subject to
the provisions of Section 2.06, be printed on steel engraved borders or fully or
partially engraved,  or legibly typed, as the proper officers of the Company may
determine,  and shall be signed on behalf of the Company by the Chairman or Vice
Chairman of its Board of Directors or its Chief Executive Officer,  President or
one of its Vice  Presidents,  under its corporate seal attested by its Secretary
or one  of its  Assistant  Secretaries.  The  signature  of the  Chairman,  Vice
Chairman,  Chief  Executive  Officer,  President or a Vice President  and/or the
signature  of the  Secretary or an Assistant  Secretary  in  attestation  of the
corporate seal, upon the Debentures, may be in the form of a manual or facsimile
signature and may be imprinted or otherwise reproduced on the Debentures and for
that purpose the Company may use the manual or facsimile signature of any person
who  shall  have  been a  Chairman,  Vice  Chairman,  Chief  Executive  Officer,
President or Vice President, or of any person who shall have been a Secretary or
Assistant  Secretary,  notwithstanding  the fact that at the time the Debentures
shall be  authenticated  and  delivered  or disposed  of such person  shall have
ceased to be the Chairman, Vice Chairman, Chief Executive Officer,  President or
a Vice President, or the Secretary or an Assistant Secretary, of the Company, as
the case may be. The seal of the Company  may be in the form of a  facsimile  of
the

                                       12





seal of the Company and may be impressed, affixed, imprinted or otherwise
reproduced on the Debentures.

         Only  such   Debentures  as  shall  bear  thereon  a   Certificate   of
Authentication  substantially  in the  form  established  for  such  Debentures,
executed  manually  by an  authorized  signatory  of  the  Trustee,  or  by  any
Authenticating  Agent with respect to such Debentures,  shall be entitled to the
benefits of this  Indenture  or be valid or  obligatory  for any  purpose.  Such
certificate executed by the Trustee, or by any Authenticating Agent appointed by
the Trustee with respect to such Debentures,  upon any Debenture executed by the
Company shall be conclusive  evidence  that the Debenture so  authenticated  has
been duly  authenticated and made available for delivery  hereunder and that the
holder is  entitled  to the  benefits  of this  Indenture.  Notwithstanding  the
foregoing,  if  any  Debenture  shall  have  been  authenticated  and  delivered
hereunder  but never  issued  and sold by the  Company,  and the  Company  shall
deliver such  Debenture to the Trustee for  cancellation  as provided in Section
2.08, for all purposes of this Indenture such Debenture shall be deemed never to
have been  authenticated and delivered  hereunder and shall never be entitled to
the benefits of this Indenture.

         At any time and from time to time after the  execution  and delivery of
this Indenture, the Company may deliver Debentures of any series executed by the
Company to the Trustee for authentication,  together with a written order of the
Company for the  authentication  and delivery of such Debentures,  signed by its
President or any Vice  President and its  Treasurer or any Assistant  Treasurer,
and the Trustee in  accordance  with such written order shall  authenticate  and
make available for delivery such  Debentures.  Each Debenture shall be dated the
date of its authentication by the Trustee.

         In   authenticating   such  Debentures  and  accepting  the  additional
responsibilities  under this  Indenture  in  relation  to such  Debentures,  the
Trustee  shall be entitled to receive,  and  (subject to Section  7.01) shall be
fully protected in relying upon, an Opinion of Counsel stating that the form and
terms thereof have been  established  in conformity  with the provisions of this
Indenture.

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

         SECTION 2.05.  EXCHANGE OF DEBENTURES.

         (a) Debentures of any series may be exchanged upon presentation thereof
at a Place of  Payment,  for  other  Debentures  of such  series  of  authorized
denominations,  and for a like aggregate principal amount, upon payment of a sum
sufficient to cover any tax or other  governmental  charge in relation  thereto,
all as provided in this Section. In respect of any Debentures so surrendered for
exchange,  the Company shall execute,  the Trustee shall  authenticate  and such
office or agency  shall make  available  for  delivery in exchange  therefor the
Debenture or Debentures of the same series which the Debentureholder  making the
exchange  shall be entitled to receive,  bearing  numbers not  contemporaneously
outstanding.

                                       13





         (b) The Company shall keep, or cause to be kept, at the Corporate Trust
Office of the Trustee (the  register  maintained in such office and in any other
office  or agency  of the  Company  in a Place of  Payment  is herein  sometimes
collectively  referred to as the "Debenture Register") in which, subject to such
reasonable  regulations  as it may  prescribe,  the Company  shall  register the
Debentures and the transfers of Debentures as in this Article provided and which
at all  reasonable  times  shall  be open for  inspection  by the  Trustee.  The
registrar for the purpose of  registering  Debentures and transfer of Debentures
as  herein   provided  shall  be  appointed  by  the  Company  (the   "Debenture
Registrar"). The initial Debenture Registrar shall be the Trustee.

         Upon surrender for transfer of any Debenture at the office or agency of
the Company in a Place of Payment,  the  Company  shall  execute and the Trustee
shall  authenticate  and deliver,  in the name of the transferee or transferees,
one or more new Debentures of the same series as the Debenture presented, of any
authorized denominations and of like tenor and aggregate principal amount.

         All Debentures presented or surrendered for exchange or registration of
transfer,  as provided in this Section,  shall be accompanied (if so required by
the Company or the Debenture  Registrar) by a written  instrument or instruments
of transfer,  in form  satisfactory  to the Company or the Debenture  Registrar,
duly executed by the  registered  holder or by his duly  authorized  attorney in
writing.

         (c) No service charge shall be made for any exchange or registration of
transfer of Debentures, or issue of new Debentures in case of partial redemption
of any series,  but the Company may require payment of a sum sufficient to cover
any tax or other governmental  charge in relation thereto,  other than exchanges
pursuant to Section 2.06, the second  paragraph of Section 3.03 and Section 9.04
not involving any transfer.

         (d) The  Company  shall  not be  required  (i) to  issue,  exchange  or
register the transfer of any Debentures during a period beginning at the opening
of business 15 days before the day of the mailing of a notice of  redemption  of
Debentures  and ending at the close of business on the day of such mailing,  nor
(ii) to register  the transfer of or exchange  any  Debentures  of any series or
portions thereof called for redemption. The provisions of this Section 2.05 are,
with respect to any Global Debenture, subject to Section 2.11 hereof.

         SECTION  2.06.  TEMPORARY   DEBENTURES.   Pending  the  preparation  of
definitive  Debentures of any series,  the Company may execute,  and the Trustee
shall  authenticate  and  make  available  for  delivery,  temporary  Debentures
(printed,  lithographed  or  typewritten)  of any authorized  denomination,  and
substantially in the form of the definitive Debentures in lieu of which they are
issued, but with such omissions, insertions and variations as may be appropriate
for  temporary  Debentures,  all as  may be  determined  by the  Company.  Every
temporary  Debenture  of any series  shall be  executed  by the  Company  and be
authenticated by the Trustee upon the same conditions and in  substantially  the
same manner, and with like effect, as the definitive  Debentures of such series.
Without  unnecessary delay the Company will execute and will furnish  definitive
Debentures of such series and thereupon any or all temporary  Debentures of such
series may be surrendered in exchange  therefor (without charge to the holders),
at a Place

                                       14





of Payment,  and upon  receipt of a written  order of the Company  signed by its
President or any Vice  President and its  Treasurer or any Assistant  Treasurer,
the  Trustee  shall  authenticate  and deliver in  exchange  for such  temporary
Debentures an equal aggregate principal amount of definitive  Debentures of such
series,  unless the Company  advises  the Trustee to the effect that  definitive
Debentures  need not be executed and  furnished  until  further  notice from the
Company.  Until so exchanged,  the temporary  Debentures of such series shall be
entitled to the same benefits under this  Indenture as definitive  Debentures of
such series authenticated and delivered hereunder.

         SECTION 2.07.  MUTILATED, DESTROYED, LOST OR STOLEN DEBENTURES.
In case any  temporary or  definitive  Debenture  shall  become  mutilated or be
destroyed, lost or stolen, the Company (subject to the next succeeding sentence)
shall execute,  and upon its written request the Trustee  (subject as aforesaid)
shall authenticate and make available for delivery,  a new Debenture of the same
series  bearing a number not  contemporaneously  outstanding,  in  exchange  and
substitution for the mutilated Debenture,  or in lieu of and in substitution for
the  Debenture so destroyed,  lost or stolen.  In every case the applicant for a
substituted  Debenture  shall  furnish to the Company  and to the  Trustee  such
security or indemnity as may be required by them to save each of them  harmless,
and,  in every case of  destruction,  loss or theft,  the  applicant  shall also
furnish to the Company and to the Trustee evidence to their  satisfaction of the
destruction,  loss or theft of the  applicant's  Debenture  and of the ownership
thereof.  The Trustee may authenticate  any such substituted  Debenture and make
available for delivery the same upon the written request or authorization of any
officer of the Company.  Upon the  issuance of any  substituted  Debenture,  the
Company may require  the payment of a sum  sufficient  to cover any tax or other
governmental  charge  that may be  imposed  in  relation  thereto  and any other
expenses  (including the fees and expenses of the Trustee) connected  therewith.
In case any  Debenture  which has  matured  or is about to mature  shall  become
mutilated or be destroyed, lost or stolen, the Company may, instead of issuing a
substitute  Debenture,  pay  or  authorize  the  payment  of the  same  (without
surrender thereof except in the case of a mutilated  Debenture) if the applicant
for such payment  shall  furnish to the Company and to the Trustee such security
or  indemnity  as they  may  require  to save  them  harmless,  and,  in case of
destruction,  loss or theft, evidence to the satisfaction of the Company and the
Trustee of the destruction, loss or theft of such Debenture and of the ownership
thereof.

         Every  Debenture  issued  pursuant to the provisions of this Section in
substitution  for any Debenture  which is mutilated,  destroyed,  lost or stolen
shall constitute an additional contractual obligation of the Company, whether or
not the mutilated,  destroyed,  lost or stolen  Debenture  shall be found at any
time, or be enforceable by anyone,  and shall be entitled to all the benefits of
this Indenture equally and proportionately  with any and all other Debentures of
the same series duly issued  hereunder.  All Debentures  shall be held and owned
upon the express  condition  that the foregoing  provisions  are exclusive  with
respect to the  replacement or payment of mutilated,  destroyed,  lost or stolen
Debentures,  and shall  preclude (to the extent lawful) any and all other rights
or remedies, notwithstanding any law or statute existing or hereafter enacted to
the  contrary  with  respect  to  the   replacement  or  payment  of  negotiable
instruments or other securities without their surrender.


                                       15





         SECTION 2.08.  CANCELLATION OF SURRENDERED DEBENTURES.  All
Debentures  surrendered  for the  purpose of  payment,  redemption,  exchange or
registration  of transfer  shall,  if  surrendered  to the Company or any paying
agent, be delivered to the Trustee for  cancellation,  or, if surrendered to the
Trustee,  shall be  cancelled by it, and no  Debentures  shall be issued in lieu
thereof  except as expressly  required or permitted by any of the  provisions of
this Indenture.  On written request of the Company, the Trustee shall deliver to
the Company  cancelled  Debentures  held by the  Trustee.  If the Company  shall
otherwise  acquire any of the Debentures,  however,  such acquisition  shall not
operate as a redemption or satisfaction of the indebtedness  represented by such
Debentures  unless  and  until  the  same  are  delivered  to  the  Trustee  for
cancellation.

         SECTION 2.09.  PROVISIONS OF INDENTURE AND  DEBENTURES FOR SOLE BENEFIT
OF PARTIES AND DEBENTUREHOLDERS. Nothing in this Indenture or in the Debentures,
express or implied,  shall give or be construed  to give to any person,  firm or
corporation,  other than the parties  hereto and the holders of the  Debentures,
any legal or  equitable  right,  remedy  or claim  under or in  respect  of this
Indenture, or under any covenant,  condition or provision herein contained;  all
such  covenants,  conditions  and  provisions  being for the sole benefit of the
parties hereto and of the holders of the Debentures.

         SECTION 2.10.  APPOINTMENT OF  AUTHENTICATING  AGENT. So long as any of
the Debentures of any series remain  outstanding  there may be an Authenticating
Agent for any or all such series of Debentures  which the Trustee shall have the
right to appoint. Said Authenticating Agent shall be authorized to act on behalf
of the Trustee to  authenticate  Debentures of such series issued upon exchange,
transfer or partial redemption thereof, and Debentures so authenticated shall be
entitled to the benefits of this Indenture and shall be valid and obligatory for
all purposes as if  authenticated  by the Trustee  hereunder.  All references in
this  Indenture to the  authentication  of  Debentures  by the Trustee  shall be
deemed to include  authentication  by an  Authenticating  Agent for such  series
except for  authentication  upon  original  issuance or pursuant to Section 2.07
hereof. Each  Authenticating  Agent shall be acceptable to the Company and shall
be a  corporation  which has a combined  capital and surplus,  as most  recently
reported or  determined  by it,  sufficient  under the laws of any  jurisdiction
under which it is organized or in which it is doing  business to conduct a trust
business,  and which is  otherwise  authorized  under such laws to conduct  such
business  and is  subject  to  supervision  or  examination  by Federal or State
authorities.  If at any time any Authenticating Agent shall cease to be eligible
in accordance with these provisions, it shall resign immediately.

         Any  Authenticating  Agent may at any time  resign  by  giving  written
notice of resignation to the Trustee and to the Company.  The Trustee may at any
time (and  upon  request  by the  Company  shall)  terminate  the  agency of any
Authenticating   Agent  by  giving   written   notice  of  termination  to  such
Authenticating  Agent  and to the  Company.  Upon  resignation,  termination  or
cessation of eligibility of any Authenticating Agent, the Trustee may appoint an
eligible successor Authenticating Agent acceptable to the Company. Any successor
Authenticating Agent, upon acceptance of its appointment hereunder, shall become
vested with all the rights, powers and duties of its predecessor hereunder as if
originally named as an Authenticating Agent pursuant hereto.

                                       16



         SECTION 2.11.  GLOBAL DEBENTURES.

         (a) If the Company  shall  establish  pursuant to Section 2.01 that the
Debentures  of a  particular  series  are to be  issued  as one or  more  Global
Debentures,  then the Company shall execute and the Trustee shall, in accordance
with Section 2.04, authenticate and deliver, one or more Global Debentures which
(i) shall  represent,  and shall be denominated in an aggregate  amount equal to
the aggregate  principal  amount of, all of the  Outstanding  Debentures of such
series,  (ii) shall be registered in the name of the  Depositary or its nominee,
(iii) shall be  delivered  by the Trustee to the  Depositary  or pursuant to the
Depositary's  instruction and (iv) shall bear,  subject to Section  2.01(12),  a
legend  substantially to the following effect:  "Except as otherwise provided in
Section 2.11 of the Indenture,  this Debenture may be transferred,  in whole but
not in  part,  only to  another  nominee  of the  Depositary  or to a  successor
Depositary or to a nominee of such successor Depositary."

         (b)   Notwithstanding  the  provisions  of  Section  2.05,  the  Global
Debenture  of a series may be  transferred,  in whole but not in part and in the
manner  provided in Section 2.05,  only to another nominee of the Depositary for
such series,  or to a successor  Depositary for such series selected or approved
by the Company or to a nominee of such successor Depositary.

         (c) If at any time the Depositary  for a series of Debentures  notifies
the Company that it is unwilling  or unable to continue as  Depositary  for such
series  or if at any time the  Depositary  for such  series  shall no  longer be
registered  or in good  standing  under the  Exchange  Act, or other  applicable
statute  or  regulation  and a  successor  Depositary  for  such  series  is not
appointed by the Company  within 90 days after the Company  receives such notice
or becomes aware of such condition,  as the case may be, this Section 2.11 shall
no longer be  applicable  to the  Debentures of such series and the Company will
execute,  and subject to Section 2.05,  the Trustee will  authenticate  and make
available for delivery  Debentures of such series in definitive  registered form
without  coupons,  in authorized  denominations,  and in an aggregate  principal
amount equal to the principal amount of the Global  Debentures of such series in
exchange for such Global  Debentures.  In addition,  the Company may at any time
determine  that the  Debentures of any series shall no longer be  represented by
one or more Global Debentures and that the provisions of this Section 2.11 shall
no longer apply to the Debentures of such series. In such event the Company will
execute and subject to Section 2.05,  the Trustee,  upon receipt of an Officers'
Certificate  evidencing such determination by the Company, will authenticate and
deliver Debentures of such series in definitive registered form without coupons,
in authorized  denominations,  and in an aggregate principal amount equal to the
principal  amount of the Global  Debentures  of such series in exchange for such
Global Debentures.  Upon the exchange of the Global Debentures for Debentures in
definitive  registered form without coupons,  in authorized  denominations,  the
Global  Debentures  shall  be  cancelled  by the  Trustee.  Such  Debentures  in
definitive  registered form issued in exchange for Global Debentures pursuant to
this Section  2.11(c) shall be  registered in such names and in such  authorized
denominations  as the Depositary,  pursuant to  instructions  from its direct or
indirect  participants  or otherwise,  shall  instruct the Trustee.  The Trustee
shall deliver such  Debentures to the  Depositary for delivery to the persons in
whose name such Debentures are so registered.


                                       17



         (d)  Debentures  distributed  to  holders  of Global  Certificates  (as
defined in the  applicable  Declaration  of Trust) upon the  dissolution  of the
applicable  Litchfield  Capital Trust shall be distributed in the form of one or
more Global Debentures  registered in the name of the Depositary or its nominee,
and deposited with the Debenture Registrar, as custodian for the Depositary,  or
with such Depositary, for credit by the Depositary to the respective accounts of
the  beneficial  owners of the  Debentures  represented  thereby  (or such other
accounts as they may direct).  Debentures distributed to holders of Certificates
(as  defined  in  the  applicable  Declaration  of  Trust),  other  than  Global
Certificates,  upon the dissolution of the applicable  Litchfield  Capital Trust
shall not be issued in the form of a Global Debenture or any other form intended
to facilitate book-entry trading in beneficial interests in such Debentures.

         (e) The Depositary or its nominee,  as the registered owner of a Global
Debenture,  shall be the holder of such Global  Debenture for all purposes under
this  Indenture  and the  Debentures,  and owners of  beneficial  interests in a
Global Debenture shall hold such interests pursuant to the applicable procedures
of the Depositary. Accordingly, any such owner's beneficial interest in a Global
Debenture  shall be shown only on, and the  transfer of such  interest  shall be
effected only through,  records  maintained by the  Depositary or its nominee or
its participants.  None of the Company,  the Trustee or the Debenture  Registrar
shall have any liability in respect of any transfer effected by the Depositary.

         (f) The rights of owners of beneficial  interests in a Global Debenture
shall be  exercised  only through the  Depositary  and shall be limited to those
established by law and agreements  between such owners and the Depositary and/or
its participants.

         SECTION 2.12. CUSIP NUMBERS.  The Company in issuing the Debentures may
use "CUSIP" numbers,  and the Trustee shall use such CUSIP numbers in notices of
redemption   or  exchange  as  a   convenience   to   Debentureholders   and  no
representation  shall be made as to the  correctness  of such numbers  either as
printed  on the  Debentures  or as  contained  in any  notice of  redemption  or
exchange.  The Company  shall  promptly  notify the Trustee of any change in the
CUSIP numbers of the Debentures.

                                    ARTICLE 3
              REDEMPTION OF DEBENTURES AND SINKING FUND PROVISIONS

         SECTION 3.01. REDEMPTION.  The Company may redeem the Debentures of any
series issued  hereunder on and after the dates and in accordance with the terms
established for such series pursuant to Section 2.01 hereof.

         SECTION 3.02.  NOTICE OF REDEMPTION.

         (a) In case the Company  shall desire to exercise  such right to redeem
all or,  as the  case may be, a  portion  of the  Debentures  of any  series  in
accordance  with the  right  reserved  so to do,  it shall  give  notice of such
redemption  to the  Trustee.  The  Trustee  shall  then  notify  holders  of the
Debentures of such series who are to be redeemed by mailing, first class postage
prepaid,  by a notice of such redemption not less than 30 days and not more than
60 days before the date fixed

                                       18





for  redemption  of that series to such holders at their last  addresses as they
shall  appear upon the  Debenture  Register.  Any notice  which is mailed in the
manner herein provided shall be  conclusively  presumed to have been duly given,
whether or not the registered holder receives the notice.  In any case,  failure
duly to give such notice to the holder of any Debenture of any series designated
for  redemption  in whole or in part,  or any  defect in the  notice,  shall not
affect  the  validity  of the  proceedings  for  the  redemption  of  any  other
Debentures of such series or any other series.  In the case of any redemption of
Debentures  prior  to the  expiration  of any  restriction  on  such  redemption
provided in the terms of such  Debentures  or elsewhere in this  Indenture,  the
Company  shall  furnish the Trustee  with an  Officers'  Certificate  evidencing
compliance with any such restriction.

         Each such notice of  redemption  shall  identify the  Debentures  to be
redeemed  (including  CUSIP  number) and shall  specify:  (i) the date fixed for
redemption,  (ii) the redemption price at which Debentures of that series are to
be redeemed,  (iii) the place or places where  Debentures  are to be surrendered
for payment of the redemption  price,  (iv) that payment of the redemption price
will be made upon  presentation and surrender of such Debentures,  at such place
or places,  (v) that interest  accrued to the date fixed for redemption  will be
paid as specified in said  notice,  (vi) that from and after said date  interest
will cease to accrue and (vii) that the  redemption  is for a sinking  fund,  if
such is the  case.  If  less  than  all the  Debentures  of a  series  are to be
redeemed,  the notice to the holders of Debentures of that series to be redeemed
in whole or in part shall specify the  particular  Debentures to be so redeemed.
In case any  Debenture is to be redeemed in part only,  the notice which relates
to such Debenture shall state the portion of the principal  amount thereof to be
redeemed,  and shall state that on and after the redemption date, upon surrender
of such  Debenture,  a new  Debenture or  Debentures of such series in principal
amount equal to the unredeemed portion thereof will be issued.

         (b) In the event of a partial redemption of a series of Debentures, the
Company  shall give the Trustee at least 45 days'  notice in advance of the date
fixed for redemption as to the aggregate  principal  amount of Debentures of the
series to be redeemed  and the other  information  set forth in the  immediately
preceding  paragraph,  and thereupon the Trustee shall select, by lot or in such
other manner as it shall deem  appropriate  and fair in its discretion and which
may provide  for the  selection  of a portion or  portions  (equal to $10 or any
integral  multiple  thereof) of the  principal  amount of such  Debentures  of a
denomination larger than $10, the Debentures to be redeemed and shall thereafter
promptly  notify the Company in writing of the numbers of the  Debentures  to be
redeemed,  in whole or in part. For all purposes of this  Indenture,  unless the
context  otherwise  requires,  all  provisions  relating  to the  redemption  of
Debentures shall relate, in the case of any Debenture redeemed or to be redeemed
only in part, to the portion of the principal amount of such Debenture which has
been or is to be redeemed. If the Company shall so direct, Debentures registered
in the name of the Company, any Affiliate or any Subsidiary thereof shall not be
included in the Debentures selected for redemption.

         The  Company  may, if and  whenever  it shall so elect,  by delivery of
instructions  signed  on its  behalf  by its  President  or any Vice  President,
instruct  the  Trustee  or any  paying  agent  to  call  all or any  part of the
Debentures  of a  particular  series  for  redemption  and  to  give  notice  of
redemption  in the manner set forth in this  Section,  such  notice to be in the
name of the Company

                                       19





or its own name as the Trustee or such paying agent may deem  advisable.  In any
case in which  notice of  redemption  is to be given by the  Trustee or any such
paying  agent,  the Company shall deliver or cause to be delivered to, or permit
to remain  with,  the  Trustee or such  paying  agent,  as the case may be, such
Debenture  Register,  transfer  books or other  records,  or suitable  copies or
extracts  therefrom,  sufficient  to enable the Trustee or such paying  agent to
give any  notice  by mail that may be  required  under  the  provisions  of this
Section.

         SECTION 3.03.  PAYMENT UPON REDEMPTION.

         (a) If the giving of notice of redemption  shall have been completed as
above  provided and funds  deposited as required,  the Debentures or portions of
Debentures  of the series to be redeemed  specified  in such notice shall become
due and  payable  on the date and at the  place  stated  in such  notice  at the
applicable  redemption  price,  together with interest accrued to the date fixed
for redemption,  and interest on such Debentures or portions of Debentures shall
cease to accrue on and after the date fixed for  redemption,  unless the Company
shall default in the payment of such redemption  price and accrued interest with
respect to any such Debenture or portion thereof.  On presentation and surrender
of such  Debentures  on or after the date fixed for  redemption  at the place of
payment  specified in the notice,  said Debentures shall be paid and redeemed at
the applicable redemption price for such series,  together with interest accrued
thereon to, but excluding,  the date fixed for redemption (but if the date fixed
for redemption is an interest payment date, the interest  installment payable on
such date shall be payable to the registered  holder at the close of business on
the applicable record date pursuant to Section 2.03).

         (b) Upon  presentation  of any  Debenture of such series which is to be
redeemed  in  part  only,  the  Company  shall  execute  and the  Trustee  shall
authenticate  and the office or agency where the  Debenture  is presented  shall
make  available  for  delivery  to the  holder  thereof,  at the  expense of the
Company,  a new  Debenture  or  Debentures  of the same  series,  of  authorized
denominations  in  principal  amount  equal  to the  unredeemed  portion  of the
Debenture so presented.

         SECTION 3.04. SINKING FUNDS FOR DEBENTURES.  The provisions of Sections
3.04,  3.05 and 3.06 shall be applicable to any sinking fund for the  retirement
of  Debentures of a series,  except as otherwise  specified as  contemplated  by
Section 2.01 for Debentures of such series.

         The minimum  amount of any sinking  fund  payment  provided  for by the
terms of Debentures of any series is herein referred to as a "mandatory  sinking
fund payment," and any payment in excess of such minimum amount  provided for by
the terms of  Debentures  of any series is herein  referred  to as an  "optional
sinking  fund  payment."  If  provided  for by the terms of  Debentures  for any
series,  the cash amount of any sinking fund payment may be subject to reduction
as provided in Section  3.05.  Each sinking fund payment shall be applied to the
redemption  of  Debentures  of any  series  as  provided  for by  the  terms  of
Debentures of such series.

         SECTION 3.05.  SATISFACTION OF SINKING FUND PAYMENTS WITH
DEBENTURES.  The Company (i) may deliver outstanding Debentures of a series
(other than

                                       20





any previously  called for redemption) and (ii) may apply as a credit Debentures
of a series  which have been  redeemed  either at the  election  of the  Company
pursuant to the terms of such Debentures or through the application of permitted
optional sinking fund payments pursuant to the terms of such Debentures, in each
case in satisfaction of all or any part of any sinking fund payment with respect
to the  Debentures  of such series  required to be made pursuant to the terms of
such Debentures as provided for by the terms of such series;  provided that such
Debentures  have not been  previously  so  credited.  Such  Debentures  shall be
received and credited  for such purpose by the Trustee at the  redemption  price
specified in such  Debentures  for redemption  through  operation of the sinking
fund and the amount of such sinking fund payment shall be reduced accordingly.

         SECTION 3.06.  REDEMPTION OF DEBENTURES FOR SINKING FUND. Not less than
45 days prior to each sinking  fund  payment date for any series of  Debentures,
the Company will deliver to the Trustee an Officers' Certificate  specifying the
amount of the next ensuing  sinking fund payment for that series pursuant to the
terms for that series, the portion thereof,  if any, which is to be satisfied by
delivering and crediting  Debentures of that series pursuant to Section 3.05 and
the basis for such credit and will,  together with such  Officers'  Certificate,
deliver to the Trustee any Debentures to be so delivered.  Not less than 30 days
before  each such  sinking  fund  payment  date the  Trustee  shall  select  the
Debentures  to be redeemed  upon such  sinking  fund  payment date in the manner
specified in Section 3.02 and cause notice of the redemption thereof to be given
in the name of and at the  expense  of the  Company in the  manner  provided  in
Section  3.02.  Such  notice  having  been duly given,  the  redemption  of such
Debentures  shall be made  upon the terms and in the  manner  stated in  Section
3.03.

                                    ARTICLE 4
                       PARTICULAR COVENANTS OF THE COMPANY

         The Company  covenants and agrees for each series of the  Debentures as
follows:

         SECTION  4.01.  PAYMENT  OF  PRINCIPAL  OF (AND  PREMIUM,  IF ANY)  AND
INTEREST ON DEBENTURES.  The Company will duly and punctually pay or cause to be
paid the  principal of (and premium,  if any) and interest on the  Debentures of
that  series  at the  time and  place  and in the  manner  provided  herein  and
established with respect to such Debentures.

         SECTION 4.02.  MAINTENANCE OF OFFICE OR AGENT FOR PAYMENT OF
DEBENTURES, DESIGNATION OF OFFICE OR AGENCY FOR PAYMENT,
REGISTRATION, TRANSFER AND EXCHANGE OF DEBENTURES.  So long as any series
of the Debentures remain  outstanding,  the Company agrees to maintain an office
or agency in each Place of Payment, with respect to each such series and at such
other  location or  locations as may be  designated  as provided in this Section
4.02,  where (i)  Debentures of that series may be presented  for payment,  (ii)
Debentures  of that  series  may be  presented  as  hereinabove  authorized  for
registration of transfer and exchange,  and (iii) notices and demands to or upon
the Company in respect of the  Debentures of that series and this  Indenture may
be given or served,  such designation to continue with respect to such office or
agency until the Company shall, by written

                                       21





notice signed by its President or a Vice President and delivered to the Trustee,
designate  some other office or agency for such  purposes or any of them.  If at
any time the Company shall fail to maintain any such  required  office or agency
or  shall  fail  to  furnish  the  Trustee  with  the  address   thereof,   such
presentations,  notices and demands may be made or served at the Corporate Trust
Office of the Trustee,  and the Company hereby appoints the Trustee as its agent
to receive all such presentations, notices and demands.

         SECTION 4.03.  DUTIES OF PAYING AGENT; COMPANY AS PAYMENT AGENT;
AND HOLDING SUMS IN TRUST.

         (a) If the Company  shall  appoint one or more paying agents for all or
any series of the  Debentures,  other than the  Trustee,  the Company will cause
each such paying  agency to execute and deliver to the Trustee an  instrument in
which such agent shall agree with the Trustee, subject to the provisions of this
Section:

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

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

                  (3) that it will,  at any time during the  continuance  of any
failure referred to in the preceding  paragraph  (a)(2) above,  upon the written
request of the Trustee,  forthwith  pay to the Trustee all sums so held in trust
by such paying agent; and

                  (4)      that it will perform all other duties of paying agent
as set forth in this Indenture.

         (b) If the Company  shall act as its own paying  agent with  respect to
any  series  of the  Debentures,  it  will on or  before  each  due  date of the
principal of (and premium, if any) or interest on Debentures of that series, set
aside,  segregate  and hold in trust for the  benefit  of the  persons  entitled
thereto a sum sufficient to pay such principal (and premium, if any) or interest
so becoming  due on  Debentures  of that series until such sums shall be paid to
such  persons or  otherwise  disposed of as herein  provided  and will  promptly
notify in writing the Trustee of such action, or any failure (by it or any other
obligor on such Debentures) to take such action. Whenever the Company shall have
one or more paying agents for any series of Debentures,  it will, prior to 11:00
a.m. New York City time on each due date of the  principal of (and  premium,  if
any) or interest on any Debentures of that series, deposit with the paying agent
a sum  sufficient  to pay the  principal  (and  premium,  if any) or interest so
becoming  due,  such  sum to be held in trust  for the  benefit  of the  persons
entitled to such principal, premium or interest, and (unless

                                       22





such paying agent is the Trustee) the Company will  promptly  notify the Trustee
of its action or failure so to act.

         (c) Anything in this Section to the contrary  notwithstanding,  (i) the
agreement  to hold sums in trust as provided  in this  Section is subject to the
provisions  of Section  11.05,  and (ii) the  Company  may at any time,  for the
purpose of obtaining the satisfaction and discharge of this Indenture or for any
other  purpose,  pay, or direct any paying agent to pay, to the Trustee all sums
held in trust by the Company or such paying  agent,  such sums to be held by the
Trustee  upon the same terms and  conditions  as those upon which such sums were
held by the Company or such paying  agent;  and, upon such payment by any paying
agent to the  Trustee,  such paying  agent  shall be  released  from all further
liability with respect to such money.

         SECTION  4.04.  APPOINTMENT  TO FILL VACANCY IN OFFICE OF TRUSTEE.  The
Company, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint,  in the manner provided in Section 7.10, a Trustee,  so that there
shall at all times be a Trustee hereunder.

                                    ARTICLE 5
                DEBENTUREHOLDERS LISTS AND REPORTS BY THE COMPANY
                                 AND THE TRUSTEE

         SECTION 5.01.  COMPANY TO FURNISH TRUSTEE INFORMATION AS TO
NAMES AND ADDRESSES OF DEBENTUREHOLDERS.  The Company will furnish or
cause to be furnished to the Trustee (a) on each regular record date (as defined
in Section 2.03) a list, in such form as the Trustee may reasonably  require, of
the names and  addresses of the holders of each series of  Debentures as of such
regular  record  date,  provided,  that the Company  shall not be  obligated  to
furnish or cause to be  furnished  such list at any time that the list shall not
differ in any respect from the most recent list  furnished to the Trustee by the
Company and (b) at such other times as the Trustee may request in writing within
30 days after the receipt by the Company of any such request,  a list of similar
form and  content as of a date not more than 15 days prior to the time such list
is furnished;  provided,  however, no such list need be furnished for any series
for which the Trustee shall be the Debenture Registrar.

         SECTION 5.02.  TRUSTEE TO PRESERVE INFORMATION AS TO NAMES AND
ADDRESSES OF DEBENTUREHOLDERS.

         (a) The Trustee shall  preserve,  in as current a form as is reasonably
practicable,  all  information  as to the names and  addresses of the holders of
Debentures  contained  in the most  recent list  furnished  to it as provided in
Section 5.01 and as to the names and addresses of holders of Debentures received
by the  Trustee  in its  capacity  as  Debenture  Registrar  (if  acting in such
capacity).

         (b) The Trustee may  destroy  any list  furnished  to it as provided in
Section 5.01 upon receipt of a new list so furnished.


                                       23





         (c)  In  case  three  or  more  holders  of   Debentures  of  a  series
(hereinafter  referred to as "applicants") apply in writing to the Trustee,  and
furnish to the Trustee  reasonable  proof that each such  applicant  has owned a
Debenture  for a  period  of at  least  six  months  preceding  the date of such
application,   and  such  application  states  that  the  applicants  desire  to
communicate  with other  holders of  Debentures of such series or holders of all
Debentures  with  respect to their  rights  under this  Indenture  or under such
Debentures,  and is  accompanied  by a copy  of  the  form  of  proxy  or  other
communication which such applicants propose to transmit,  then the Trustee shall
within  five  Business  Days  after  the  receipt  of such  application,  at its
election, either:

                  (1)  afford  to  such  applicants  access  to the  information
preserved  at the time by the  Trustee  in  accordance  with the  provisions  of
subsection (a) of this Section 5.02; or

                  (2) inform such  applicants  as to the  approximate  number of
holders of Debentures of such series or of all  Debentures,  as the case may be,
whose names and addresses appear in the information preserved at the time by the
Trustee,  in accordance  with the  provisions of subsection  (a) of this Section
5.02, and as to the  approximate  cost of mailing to such  Debentureholders  the
form of proxy or other communication, if any, specified in such application.

         (d) If the Trustee shall elect not to afford such applicants  access to
such  information,   the  Trustee  shall,  upon  the  written  request  of  such
applicants, mail to each holder of such series or of all Debentures, as the case
may be, whose name and address appears in the information  preserved at the time
by the Trustee in  accordance  with the  provisions  of  subsection  (a) of this
Section  5.02,  a copy of the  form of proxy  or  other  communication  which is
specified in such  request,  with  reasonable  promptness  after a tender to the
Trustee  of the  material  to be mailed and of  payment,  or  provision  for the
payment,  of the reasonable  expenses of mailing,  unless within five days after
such  tender,  the  Trustee  shall  mail to such  applicants  and file  with the
Securities and Exchange Commission (the  "Commission"),  together with a copy of
the  material  to be mailed,  a written  statement  to the effect  that,  in the
opinion of the Trustee,  such mailing would be contrary to the best interests of
the holders of Debentures of such series or of all  Debentures,  as the case may
be, or would be in violation of  applicable  law. Such written  statement  shall
specify the basis of such opinion.  If the Commission,  after  opportunity for a
hearing upon the objections  specified in the written statement so filed,  shall
enter an order refusing to sustain any of such objections or if, after the entry
of an order  sustaining one or more of such  objections,  the  Commission  shall
find,  after notice and  opportunity  for hearing,  that all the  objections  so
sustained have been met and shall enter an order so declaring, the Trustee shall
mail  copies  of such  material  to all such  Debentureholders  with  reasonable
promptness  after  the  entry of such  order  and the  renewal  of such  tender;
otherwise,  the  Trustee  shall be relieved  of any  obligation  or duty to such
applicants respecting their application.

         (e) Each and every holder of the  Debentures,  by receiving and holding
the same,  agrees with the Company and the Trustee  that neither the Company nor
the  Trustee  nor any paying  agent nor any  Debenture  Registrar  shall be held
accountable by reason of the disclosure of any such  information as to the names
and addresses of the holders of Debentures in accordance  with the provisions of
subsection (c) of this Section 5.02, regardless of the source

                                       24





from which such information was derived,  and that the Trustee shall not be held
accountable  by reason of mailing any material  pursuant to a request made under
said subsection (c).

         SECTION 5.03.  ANNUAL AND OTHER REPORTS TO BE FILED BY COMPANY
WITH THE TRUSTEE.

         (a) The Company  covenants and agrees to file with the Trustee,  within
15 days after the  Company  is  required  to file the same with the  Commission,
copies of the annual reports and of the information, documents and other reports
(or copies of such portions of any of the foregoing as the  Commission  may from
time to time by rules  and  regulations  prescribe)  which  the  Company  may be
required to file with the Commission  pursuant to Section 13 or Section 15(d) of
the  Exchange  Act;  or, if the  Company is not  required  to file  information,
documents or reports pursuant to either of such sections,  then to file with the
Trustee  and the  Commission  in  accordance  with  the  rules  and  regulations
prescribed from time to time by the Commission,  such of the  supplementary  and
periodic  information,  documents and reports which may be required  pursuant to
Section 13 of the Exchange Act, in respect of a security  listed and  registered
on a national securities exchange as may be prescribed from time to time in such
rules and  regulations.  Delivery of such reports,  information and documents to
the Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute  constructive notice of any information  contained therein,
including the Company's  compliance  with any of its covenants  hereunder (as to
which the Trustee is entitled to rely exclusively on Officers' Certificates).

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

         (c) The Company  covenants and agrees to transmit by mail,  first class
postage  prepaid,  or reputable  over-night  delivery service which provides for
evidence  of receipt,  to the  Debentureholders,  as their  names and  addresses
appear upon the Debenture Register, within 30 days after the filing thereof with
the Trustee,  such summaries of any information,  documents and reports required
to be filed by the Company  pursuant to subsections  (a) and (b) of this Section
as may be required by rules and regulations  prescribed from time to time by the
Commission.

         (d) The Company  covenants and agrees to furnish to the Trustee,  on or
before  May 15 in  each  calendar  year  in  which  any of  the  Debentures  are
outstanding, or on or before such other day in each calendar year as the Company
and the Trustee may from time to time agree upon, a Certificate as to his or her
knowledge of the Company's  compliance  with all conditions and covenants  under
this Indenture.  For purposes of this  subsection (d), such compliance  shall be
determined  without  regard  to any  period  of grace or  requirement  of notice
provided under this Indenture.


                                       25

<PAGE>



         (e) The Company shall  deliver to the Trustee,  as soon as possible and
in any event within five days after the Company  becomes aware of the occurrence
of any Event of Default,  an Officers'  Certificate setting forth the details of
such Event of Default  and the action  which the  Company  proposes to take with
respect thereto.

         SECTION 5.04.  TRUSTEE TO TRANSMIT ANNUAL REPORT TO
DEBENTUREHOLDERS.

         (a)  The  Trustee  shall  transmit  to  Debentureholders  such  reports
concerning  the Trustee and its actions under this  Indenture as may be required
pursuant  to the Trust  Indenture  Act at the times and in the  manner  provided
pursuant thereto.  If required by Section 313(a) of the Trust Indenture Act, the
Trustee  shall,  within 60 days after each January 15 following the date of this
Indenture,  commencing  January 15, 2000,  deliver to  Debentureholders  a brief
report,  dated as of such January 15, which complies with the provisions of such
Section 313(a).

         (b)      The Trustee shall comply with Section 313(b) and 313(c) of the
Trust Indenture Act.

         (c) A copy of each such report shall, at the time of such  transmission
to Debentureholders,  be filed by the Trustee with the Company,  with each stock
exchange upon which any  Debentures  are listed (if so listed) and also with the
Commission.  The Company agrees to notify the Trustee when any Debentures become
listed on any stock exchange and of any delisting thereof.

                                    ARTICLE 6
                  REMEDIES OF THE TRUSTEE AND DEBENTUREHOLDERS
                               ON EVENT OF DEFAULT

         SECTION 6.01.  EVENTS OF DEFAULT DEFINED.

         (a)  Whenever  used herein with respect to  Debentures  of a particular
series,  "Event of Default" means any one or more of the following  events which
has occurred and is continuing:

                  (1) default in the payment of any installment of interest upon
any of the Debentures of that series,  as and when the same shall become due and
payable,  and  continuance  of such  default for a period of 30 days;  provided,
however,  that a valid extension of an interest payment period by the Company in
accordance  with the  terms of any  indenture  supplemental  hereto,  shall  not
constitute a default in the payment of interest for this purpose;

                  (2)  default  (i) in the  payment  of the  principal  of  (and
premium,  if any, on) any of the  Debentures of that series as and when the same
shall become due and payable whether at maturity, upon redemption,  by declaring
or otherwise,  or (ii) in any payment  required by any sinking or analogous fund
established  with  respect to that  series,  and in the case of this clause (ii)
only, continuance of such default for a period of 30 days;


                                       26





                  (3)  failure  on the part of the  Company  duly to  observe or
perform,  in any material  respect,  any other of the covenants or agreements on
the part of the Company with respect to that series contained in such Debentures
or otherwise  established with respect to that series of Debentures  pursuant to
Section  2.01 hereof or contained  in this  Indenture  (other than a covenant or
agreement  which has been expressly  included in this  Indenture  solely for the
benefit of one or more series of Debentures other than such series) for a period
of 90 days after the date on which written notice of such failure, requiring the
same to be  remedied  and  stating  that such  notice is a "Notice  of  Default"
hereunder, shall have been given to the Company by the Trustee, by registered or
certified mail, or to the Company and the Trustee by the holders of at least 25%
in principal amount of the Debentures of that series at the time Outstanding;

                  (4) a decree or order by a court  having  jurisdiction  in the
premises shall have been entered adjudging the Company as bankrupt or insolvent,
or approving as properly filed a petition seeking  liquidation or reorganization
of the Company under the Federal Bankruptcy Code or any other similar applicable
Federal or State law,  and such decree or order shall have  continued  unvacated
and unstayed for a period of 90 days; or an involuntary  case shall be commenced
under such Code in respect of the Company and shall continue  undismissed  for a
period of 90 days or an order for relief in such case  shall have been  entered;
or a decree or order of a court having  jurisdiction  in the premises shall have
been entered for the  appointment on the ground of insolvency or bankruptcy of a
receiver or  custodian or  liquidator  or trustee or assignee in  bankruptcy  or
insolvency  of  the  Company  or of  its  property,  or for  the  winding  up or
liquidation  of its  affairs,  and such decree or order  shall have  remained in
force unvacated and unstayed for a period of 90 days;

                  (5) the Company shall institute  proceedings to be adjudicated
a voluntary  bankrupt or shall consent to the filing of a bankruptcy  proceeding
against it, or shall file a petition or answer or consent seeking liquidation or
reorganization under the Federal Bankruptcy Code or any other similar applicable
Federal or State law, or shall  consent to the filing of any such  petition,  or
shall consent to the  appointment on the ground of insolvency or bankruptcy of a
receiver or  custodian or  liquidator  or trustee or assignee in  bankruptcy  or
insolvency of it or of its property, or shall make an assignment for the benefit
of creditors; or

                  (6)      any other Event of Default provided with respect to
Debentures of that series.

         (b) In each and  every  such  case,  unless  the  principal  of all the
Debentures of that series shall have already become due and payable,  either the
Trustee or the holders of not less than 25% in aggregate principal amount of the
Debentures of that series then  Outstanding  hereunder,  by notice in writing to
the Company (and to the Trustee if given by such Debentureholders),  may declare
the  principal  of all the  Debentures  of  that  series  to be due and  payable
immediately  and upon any such  declaration  the same shall  become and shall be
immediately  due and payable,  anything  contained  in this  Indenture or in the
Debentures of that series or established with respect to that series pursuant to
Section 2.01 hereof to the contrary  notwithstanding.  Payment of principal  and
interest on such Debentures shall remain subordinated

                                       27





to the extent  provided in Article 14  notwithstanding  that such  amount  shall
become immediately due and payable as herein provided.

         (c) Section 6.01(b),  however,  is subject to the condition that if, at
any time after the principal of the Debentures of that series shall have been so
declared due and  payable,  and before any judgment or decree for the payment of
the moneys due shall have been obtained or entered as hereinafter provided,  the
Company shall pay or shall deposit with the Trustee a sum  sufficient to pay all
matured  installments of interest upon all the Debentures of that series and the
principal of (and  premium,  if any, on) any and all  Debentures  of that series
which shall have become due otherwise than by  acceleration  (with interest upon
such  principal  and premium if any,  and,  to the extent  that such  payment is
enforceable under applicable law, upon overdue installments of interest,  at the
rate per annum  expressed in the  Debentures  of that series to the date of such
payment or deposit) and the amount  payable to the Trustee  under  Section 7.06,
and any and all  defaults  under the  Indenture,  other than the  nonpayment  of
principal on  Debentures of that series which shall not have become due by their
terms,  shall have been  remedied or waived as provided in Section 6.06 then and
in every such case the holders of a majority in  aggregate  principal  amount of
the Debentures of that series then  outstanding  (subject to, in the case of any
series of Debentures held as trust assets of a Litchfield Capital Trust and with
respect to which a Security Exchange has not theretofore occurred,  such consent
of the holders of the  Preferred  Securities  and the Common  Securities of such
Litchfield  Capital Trust as may be required  under the  Declaration of Trust of
such  Litchfield  Capital  Trust),  by written  notice to the Company and to the
Trustee,  may  rescind  and annul such  declaration  and its  consequences  with
respect to that series of Debentures; but no such rescission and annulment shall
extend to or shall  affect any  subsequent  default,  or shall  impair any right
consequent thereon.

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

         (e) If, prior to a Security  Exchange with respect to the Debentures of
any series,  a Default with respect to the  Debentures of such series shall have
occurred,  the Company  expressly  acknowledges that under the circumstances set
forth in the applicable Declaration of Trust, any holder of Preferred Securities
of the applicable  Litchfield Capital Trust may, to the fullest extent permitted
by law, enforce directly against the Company the applicable  Property  Trustee's
rights  hereunder.  In furtherance of the foregoing and for the avoidance of any
doubt, the Company  acknowledges that, under the circumstances  described in the
applicable Declaration of Trust, any such holder of Preferred Securities, in its
own name, in the name of the applicable  Litchfield Capital Trust or in the name
of the holders of the Preferred  Securities  issued by such  Litchfield  Capital
Trust, may institute or cause to be instituted a proceeding,  including, without
limitation,  any  suit  in  equity,  an  action  at law  or  other  judicial  or
administrative  proceeding,  to enforce the applicable Property Trustee's rights
hereunder directly against the Company as issuer of the

                                       28





applicable  series of Debentures,  and may prosecute such proceeding to judgment
or final decree, and enforce the same against the Company.

         SECTION 6.02.  COVENANT OF COMPANY TO PAY TO TRUSTEE WHOLE
AMOUNT DUE ON DEBENTURES ON DEFAULT IN PAYMENT OF INTEREST OR
PRINCIPAL (AND PREMIUMS, IF ANY).

         (a) The Company covenants that (1) in case default shall be made in the
payment of any installment of interest on any of the Debentures of a series,  or
any payment  required by any sinking or analogous fund  established with respect
to that series as and when the same shall have become due and payable,  and such
default  shall have  continued  for a period of 30 days,  or (2) in case default
shall be made in the payment of the principal of (or premium, if any, on) any of
the  Debentures  of a series  when the same shall have  become due and  payable,
whether upon maturity of the  Debentures of a series or upon  redemption or upon
declaration or otherwise, then, upon demand of the Trustee, the Company will pay
to the Trustee, for the benefit of the holders of the Debentures of that series,
the whole  amount  that then  shall  have  become  due and  payable  on all such
Debentures for principal (and premium, if any) or interest, or both, as the case
may be, with interest upon the overdue  principal (and premium,  if any) and (to
the extent that payment of such interest is enforceable under applicable law and
without  duplication  of any other amounts paid by the Company or the applicable
Litchfield  Capital  Trust in respect  thereof)  upon  overdue  installments  of
interest at the rate per annum expressed in the Debentures of that series;  and,
in addition  thereto,  such further  amount as shall be  sufficient to cover the
costs and expenses of  collection,  and the amount  payable to the Trustee under
Section 7.06.

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

         (c) In case of any receivership,  insolvency, liquidation,  bankruptcy,
reorganization,   readjustment,   arrangement,  composition  or  other  judicial
proceedings affecting the Company, any other obligor on such Debentures,  or the
creditors or property of either,  the Trustee  shall have the power to intervene
in such  proceedings  and take any action  therein  that may be permitted by the
court and shall (except as may be otherwise provided by law) be entitled to file
such  proofs of claim and other  papers and  documents  as may be  necessary  or
advisable  in order to have the  claims of the  Trustee  and of the  holders  of
Debentures  of such series  allowed for the entire amount due and payable by the
Company or such other obligor under the Indenture at the date of  institution of
such proceedings and for any additional  amount which may become due and payable
by the Company or such other obligor after such date, and to collect and receive
any moneys or other property  payable or  deliverable on any such claim,  and to
distribute  the same after the  deduction  of the amount  payable to the Trustee
under Section 7.06; and any receiver,

                                       29





assignee or trustee in bankruptcy or reorganization is hereby authorized by each
of the  holders  of  Debentures  of such  series  to make such  payments  to the
Trustee,  and, in the event that the Trustee shall consent to the making of such
payments directly to such Debentureholders, to pay to the Trustee any amount due
it under Section 7.06.

         (d) All rights of action and of asserting  claims under this Indenture,
or under any of the terms established with respect to Debentures of that series,
may be enforced by the Trustee without the possession of any of such Debentures,
or the production thereof at any trial or other proceeding relative thereto, and
any such suit or  proceeding  instituted  by the Trustee shall be brought in its
own name as trustee of an express  trust,  and any  recovery of judgment  shall,
after  provision  for payment to the  Trustee of any  amounts due under  Section
7.06,  be for the  ratable  benefit  of the  holders of the  Debentures  of such
series.

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

         Nothing  herein  contained  shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any  Debentureholder any
plan of  reorganization,  arrangement,  adjustment or composition  affecting the
Debentures  of that series or the rights of any holder  thereof or to  authorize
the Trustee to vote in respect of the claim of any  Debentureholder  in any such
proceeding.

         SECTION 6.03.  APPLICATION OF MONEYS COLLECTED BY TRUSTEE.  Any
moneys  collected  by the Trustee  pursuant to this  Article  with  respect to a
particular series of Debentures shall be applied in the order following,  at the
date or dates fixed by the  Trustee  and,  in case of the  distribution  of such
moneys  on  account  of  principal  (or  premium,  if  any)  or  interest,  upon
presentation of the several  Debentures of that series, and stamping thereon the
payment, if only partially paid, and upon surrender thereof if fully paid:

         FIRST: To the payment of costs and expenses of collection and of all
         amounts payable to the Trustee under Section 7.06;

         SECOND: To the payment of all Senior Debt of the Company if and to the
         extent required by Article 14;

         THIRD:  To  the  payment  of the  amounts  then  due  and  unpaid  upon
         Debentures  of such  series for  principal  (and  premium,  if any) and
         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  Debentures  for
         principal (and premium, if any) and interest, respectively; and

                                       30





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

         SECTION 6.04.  LIMITATION ON SUITS BY HOLDERS OF DEBENTURES.  No holder
of any  Debenture of any series shall have any right by virtue or by availing of
any provision of this  Indenture to institute any suit,  action or proceeding in
equity  or at law upon or under or with  respect  to this  Indenture  or for the
appointment of a receiver or trustee, or for any other remedy hereunder,  unless
(i) such holder  previously shall have given to the Trustee written notice of an
Event of Default and of the  continuance  thereof with respect to  Debentures of
such series specifying such Event of Default, as hereinbefore provided, (ii) the
holders of not less than 25% in aggregate  principal amount of the Debentures of
such series then outstanding shall have made written request upon the Trustee to
institute such action,  suit or proceeding in its own name as trustee hereunder,
(iii) shall have offered to the Trustee indemnity satisfactory to it against the
costs,  expenses and  liabilities  to be incurred  therein or thereby,  (iv) the
Trustee  for 60 days after its  receipt  of such  notice,  request  and offer of
indemnity,  shall have failed to institute any such action,  suit or proceeding;
and (v) during such 60 day period, the holders of a majority in principal amount
of  the  Debentures  of  that  series  do  not  give  the  Trustee  a  direction
inconsistent  with the request;  it being  understood  and  intended,  and being
expressly  covenanted by the taker and holder of every  Debenture of such series
with every other such taker and holder and Trustee,  that no one or more holders
of  Debentures  of such series shall have any right in any manner  whatsoever by
virtue or by availing of any provision of this  Indenture to affect,  disturb or
prejudice  the  rights of the  holders  of any other of such  Debentures,  or to
obtain or seek to obtain  priority  over or preference to any other such holder,
or to enforce  any right  under  this  Indenture,  except in the  manner  herein
provided  and for the  equal,  ratable  and  common  benefit  of all  holders of
Debentures of such series.  For the protection and enforcement of the provisions
of this  Section,  each  and  every  Debentureholder  and the  Trustee  shall be
entitled to such relief as can be given either at law or in equity.

         Notwithstanding  any other provisions of this Indenture,  however,  the
right of any holder of any Debenture to receive payment of the principal of (and
premium,  if any) and interest on such  Debenture,  as therein  provided,  on or
after the  respective  due dates  expressed in such Debenture (or in the case of
redemption, on the redemption date), or to institute suit for the enforcement of
any such payment on or after such respective dates or redemption date, shall not
be impaired or affected without the consent of such holder.

         SECTION 6.05.  REMEDIES CUMULATIVE; DELAY OR OMISSION IN EXERCISE
OF RIGHTS NOT WAIVER OF DEFAULT.

         (a) All powers and  remedies  given by this Article 6 to the Trustee or
to the  Debentureholders  shall,  to the  extent  permitted  by law,  be  deemed
cumulative  and not  exclusive of any others  thereof or of any other powers and
remedies available to the Trustee or the holders of the Debentures,  by judicial
proceedings or otherwise,  to enforce performance or observance of the covenants
and agreements contained in this Indenture or otherwise established with respect
to such Debentures.


                                       31





         (b) No delay or  omission of the Trustee or of any holder of any of the
Debentures  to exercise  any right or power  accruing  upon any Event of Default
occurring and continuing as aforesaid  shall impair any such right or power,  or
shall  be  construed  to be a  waiver  of any such  default  or an  acquiescence
therein;  and, subject to the provisions of Section 6.04, every power and remedy
given by this Article or by law to the Trustee or to the Debentureholders may be
exercised from time to time, and as often as shall be deemed  expedient,  by the
Trustee or by the Debentureholders.

         SECTION 6.06.  RIGHTS OF HOLDERS OF MAJORITY IN PRINCIPAL AMOUNT
OF DEBENTURES TO DIRECT TRUSTEE AND TO WAIVE DEFAULTS.  The holders of a
majority in aggregate  principal  amount of the  Debentures of any series at the
time Outstanding,  determined in accordance with Section 8.04 (with, in the case
of any series of Debentures  held as trust assets of a Litchfield  Capital Trust
and with respect to which a Security Exchange has not theretofore occurred, such
consent of holders of the Preferred Securities and the Common Securities of such
Litchfield  Capital Trust as may be required  under the  Declaration of Trust of
such Litchfield Capital Trust),  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 such
series; provided, however, that such direction shall not be in conflict with any
rule of law or with  this  Indenture  or  unduly  prejudicial  to the  rights of
holders of Debentures of any other series at the time Outstanding  determined in
accordance with Section 8.04 not parties  thereto.  Subject to the provisions of
Section  7.01,  the  Trustee  shall have the right to decline to follow any such
direction  if the  Trustee  in good faith  shall,  by a  Responsible  Officer or
Officers of the Trustee, determine that the proceeding so directed would involve
the  Trustee in  personal  liability.  The  holders of a majority  in  aggregate
principal  amount  of the  Debentures  of any  series  at the  time  Outstanding
affected thereby,  determined in accordance with section 8.04 (with, in the case
of any series of Debentures  held as trust assets of a Litchfield  Capital Trust
and with respect to which a Security Exchange has not theretofore occurred, such
consent of holders of the Preferred Securities and the Common Securities of such
Litchfield  Capital Trust as may be required  under the  Declaration of Trust of
such  Litchfield  Capital  Trust),  may on behalf of the  holders  of all of the
Debentures  of such series waive any past default in the  performance  of any of
the  covenants  contained  herein or  established  pursuant to Section 2.01 with
respect to such series and its consequences,  except a default in the payment of
the principal of, or premium,  if any, or interest on, any of the  Debentures of
that  series  as and  when  the  same  shall  become  due by the  terms  of such
Debentures  otherwise than by  acceleration  (unless such default has been cured
and a sum sufficient to pay all matured  installments  of interest and principal
and any premium has been deposited with the Trustee (in accordance  with Section
6.01(c)),  or a call for redemption of Debentures of that series.  Upon any such
waiver, the default covered thereby shall be deemed to be cured for all purposes
of this Indenture and the Company, the Trustee and the holders of the Debentures
of such series shall be restored to their former positions and rights hereunder,
respectively; but no such waiver shall extend to any subsequent or other default
or impair any right consequent thereon.

         SECTION 6.07.  TRUSTEE TO GIVE NOTICE OF DEFAULTS KNOWN TO IT, BUT
MAY WITHHOLD IN CERTAIN CIRCUMSTANCES.  The Trustee shall, within 90 days after

                                       32





the  occurrence  of a default with respect to a particular  series,  transmit by
mail, first class postage prepaid,  to the holders of Debentures of that series,
as their names and addresses appear upon the Debenture  Register,  notice of all
defaults with respect to that series known to the Trustee,  unless such defaults
shall have been cured before the giving of such notice (the term  "defaults" for
the purposes of this Section being hereby defined to be the events  specified in
subsections  (1),  (2), (3), (4) and (5) of Section  6.01(a),  not including any
periods of grace provided for therein and  irrespective  of the giving of notice
provided for by subsection (3) of Section  6.01(a));  provided,  that, except in
the case of default in the payment of the  principal of (or premium,  if any) or
interest  on any of the  Debentures  of that  series  or in the  payment  of any
sinking fund installment  established  with respect to that series,  the Trustee
shall be  protected  in  withholding  such notice if and so long as the board of
directors,  the executive  committee,  or a trust committee of directors  and/or
Responsible   Officers,  of  the  Trustee  in  good  faith  determine  that  the
withholding  of such notice is in the  interests of the holders of Debentures of
that series;  provided further, that in the case of any default of the character
specified in Section  6.01(a)(3)  with respect to  Debentures  of such series no
such notice to the holders of the Debentures of that series shall be given until
at least 30 days after the occurrence thereof.

         The  Trustee  shall  not be deemed to have  knowledge  of any  default,
except (i) a default under  subsection  (a)(1) or (a)(2) of Section 6.01 as long
as the Trustee is acting as paying agent for such series of  Debentures  or (ii)
any default as to which a Responsible Officer of the Trustee shall have received
written notice.

         SECTION 6.08.  REQUIREMENTS OF AN UNDERTAKING TO PAY COSTS IN
CERTAIN SUITS UNDER INDENTURE OR AGAINST TRUSTEE.  All parties to this
Indenture  agree,  and each holder of any  Debentures  by his or her  acceptance
thereof  shall be deemed to have  agreed,  that any court may in its  discretion
require,  in any suit for the  enforcement  of any  right or remedy  under  this
Indenture, or in any suit against the Trustee for any action taken or omitted by
it as Trustee,  the filing by any party  litigant in such suit of an undertaking
to pay the costs of such suit, and that such court may in its discretion  assess
reasonable costs, including reasonable attorneys' fees and expenses, against any
party  litigant in such suit,  having due regard to the merits and good faith of
the claims or defenses made by such party  litigant;  but the provisions of this
Section  shall  not apply to any suit  instituted  by the  Trustee,  to any suit
instituted by any Debentureholder,  or group of  Debentureholders,  holding more
than 10% in aggregate  principal  amount of the  outstanding  Debentures  of any
series, or to any suit instituted by any  Debentureholder for the enforcement of
the  payment  of the  principal  of (or  premium,  if  any) or  interest  on any
Debenture of such series, on or after the respective due dates expressed in such
Debenture or established pursuant to this Indenture.

                                    ARTICLE 7
                             CONCERNING THE TRUSTEE

         SECTION 7.01. UPON EVENT OF DEFAULT  OCCURRING AND CONTINUING,  TRUSTEE
SHALL  EXERCISE  POWERS  VESTED IN IT, AND USE SAME  DEGREE OF CARE AND SKILL IN
THEIR EXERCISE, AS PRUDENT INDIVIDUAL WOULD USE.


                                       33





         (a) The Trustee,  prior to the  occurrence  of an Event of Default with
respect to  Debentures of a series and after the curing of all Events of Default
with  respect  to  Debentures  of that  series  which may have  occurred,  shall
undertake to perform with respect to  Debentures  of such series such duties and
only such duties as are specifically set forth in this Indenture, and no implied
covenants  shall be read into this  Indenture  against the  Trustee.  In case an
Event of Default with respect to Debentures of a series has occurred  (which has
not been cured or waived), the Trustee shall exercise with respect to Debentures
of that series such of the rights and powers vested in it by this Indenture, and
use the same  degree of care and skill in their  exercise,  as a prudent  person
would exercise or use under the  circumstances  in the conduct of his or her own
affairs.

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

                  (1)  prior  to the  occurrence  of an Event  of  Default  with
respect  to  Debentures  of a series and after the curing or waiving of all such
Events of Default with respect to that series which may have occurred:

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

                           (ii)     in the absence of bad faith on the part of
the Trustee, the Trustee may with respect to Debentures of such series
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture; but in the case
of any such certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, the Trustee shall be under
a duty to examine the same to determine whether or not they conform to the
requirements of this Indenture but need not confirm or investigate the accuracy
of mathematical calculations or other facts stated therein;

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

                  (3) the Trustee shall not be liable with respect to any action
taken  or  omitted  to be  taken  by it in good  faith  in  accordance  with the
direction of the holders of not less than a majority in principal  amount of the
Debentures of any series at the time  outstanding  relating to the time,  method
and place of conducting any proceeding for any remedy  available to the Trustee,
or exercising any trust or power conferred upon the Trustee under this Indenture
with respect to the Debentures of that series;

                                       34





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

                  (5)  whether  or not  therein  expressly  so  provided,  every
provision of this  Indenture  relating to the conduct or affecting the liability
of or affording  protection to the Trustee shall be subject to the provisions of
this Article 7.

         SECTION 7.02.  CERTAIN RIGHTS OF THE TRUSTEE.  Except as otherwise
provided in Section 7.01:

         (a) The Trustee may conclusively  rely and shall be protected in acting
or  refraining  from  acting  upon  any  resolution,   certificate,   statement,
instrument,  opinion,  report, notice, request,  consent, order, approval, bond,
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,  direction,  order or demand of the Company  mentioned
herein shall be  sufficiently  evidenced by a Board  Resolution or an instrument
signed in the name of the Company by the President or any Vice  President and by
the  Secretary  or an  Assistant  Secretary  or the  Treasurer  or an  Assistant
Treasurer  (unless other evidence in respect thereof is specifically  prescribed
herein);

         (c) The Trustee  may  consult  with  counsel of its  selection  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 or  suffered  or
omitted hereunder in good faith and in reliance thereon;

         (d) The Trustee  shall be under no  obligation  to exercise  any of the
rights  or  powers  vested  in it by this  Indenture  at the  request,  order or
direction of any of the  Debentureholders,  pursuant to the  provisions  of this
Indenture,  unless  such  Debentureholders  shall have  offered  to the  Trustee
security  or  indemnity  satisfactory  to it  against  the costs,  expenses  and
liabilities  which may be incurred therein or thereby;  nothing herein contained
shall, however, relieve the Trustee of the obligation, upon the occurrence of an
Event of Default with respect to a series of the Debentures  (which has not been
cured or waived) to exercise  with respect to  Debentures of that series such of
the rights and powers vested in it by this Indenture, and to 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 such person's own affairs;

         (e) The Trustee  shall not be liable for any action taken or omitted to
be taken by it in good faith and believed by it to be  authorized  or within the
discretion  or rights or powers  conferred  upon it by this  Indenture;  nothing
herein contained shall, however, relieve the Trustee of the obligation, upon the
occurrence  of an Event of Default  with  respect to a series of the  Debentures
(which has not been cured or waived) to exercise  with respect to  Debentures of
that

                                       35





series such of the rights and powers vested in it by this Indenture,  and to 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 such  person's  own
affairs;

         (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,  consent, order, approval, bond, security, or
other papers or documents,  unless  requested in writing so to do by the holders
of not less than a majority in principal amount of the outstanding Debentures of
the particular series affected thereby (determined as provided in Section 8.04);
provided,  however,  that if the payment within a reasonable time to the Trustee
of the costs,  expenses or liabilities likely to be incurred by it in the making
of such investigation is, in the opinion of the Trustee,  not reasonably assured
to the Trustee by the  security  afforded to it by the terms of this  Indenture,
the  Trustee  may  require  indemnity  satisfactory  to it against  such  costs,
expenses or liabilities as a condition to so proceeding.  The reasonable expense
of every  such  examination  shall  be paid by the  Company  or,  if paid by the
Trustee, shall be repaid by the Company upon demand;

         (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; and

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

         SECTION 7.03.  TRUSTEE NOT LIABLE FOR RECITALS IN INDENTURE OR IN
DEBENTURES.

         (a) The recitals contained herein and in the Debentures (other than the
Certificate  of  Authentication  on  the  Debentures)  shall  be  taken  as  the
statements of the Company,  and the Trustee  assumes no  responsibility  for the
correctness of the same.

         (b)  The  Trustee  makes  no  representations  as to  the  validity  or
sufficiency of this Indenture or of the Debentures.

         (c) The Trustee shall not be accountable  for the use or application by
the Company of any of the Debentures or of the proceeds of such  Debentures,  or
for the use or  application of any moneys paid over by the Trustee in accordance
with any provision of this Indenture or established pursuant to Section 2.01, or
for the use or application of any moneys received by any paying agent other than
the Trustee.

         SECTION 7.04.  TRUSTEE, PAYING AGENT OR DEBENTURE REGISTRAR MAY
OWN DEBENTURES.  The Trustee or any paying agent or Debenture Registrar,
in its individual

                                       36





or any other  capacity,  may  become the owner or  pledgee  of  Debentures  and,
subject to Sections 7.08 and 7.13,  may otherwise deal with the Company with the
same  rights it would have if it were not  Trustee,  paying  agent or  Debenture
Registrar.

         SECTION  7.05.  MONEYS  RECEIVED BY TRUSTEE TO BE HELD IN TRUST WITHOUT
INTEREST. Subject to the provisions of Section 11.05, all moneys received by the
Trustee shall,  until used or applied as herein  provided,  be held in trust for
the purposes for which they were received, but need not be segregated from other
funds  except to the  extent  required  by law.  The  Trustee  shall be under no
liability for interest on any moneys received by it hereunder  except such as it
may agree in writing to pay thereon.

         SECTION 7.06.  TRUSTEE ENTITLED TO COMPENSATION, REIMBURSEMENT
AND INDEMNITY.

         (a) The Company covenants and agrees to pay to the Trustee from time to
time, and the Trustee shall be entitled to, such compensation as the Company and
the Trustee shall from time to time agree in writing (which shall not be limited
by any provision of law in regard to the compensation of a trustee of an express
trust) for all services  rendered by it in the  execution  of the trusts  hereby
created  and in the  exercise  and  performance  of any of the powers and duties
hereunder of the Trustee, and the Company will pay or reimburse the Trustee upon
its request for all reasonable expenses,  disbursements and advances incurred or
made by the Trustee in accordance  with any of the  provisions of this Indenture
(including  the  reasonable   compensation  and  the  reasonable   expenses  and
disbursements  of its counsel and of all  persons not  regularly  in its employ)
except  any  such  expense,  disbursement  or  advance  as may  arise  from  its
negligence  or bad faith.  The Company also  covenants to indemnify  each of the
Trustee or any  predecessor  Trustee and their officers,  agents,  directors and
employees for, and to hold them harmless against,  any and all loss,  liability,
damage,  claim or expense including taxes (other than taxes based upon, measured
by or determined by the income of the Trustee)  incurred  without  negligence or
bad faith on the part of the Trustee and  arising out of or in  connection  with
the acceptance or administration  of this trust,  including the reasonable costs
and  expenses of defending  itself  against any claim  (whether  asserted by the
Company,  any Debentureholder or any other Person) of liability in the premises.
The  provisions  of this  Section  7.06 shall  survive the  termination  of this
Indenture and resignation or removal of the Trustee.

         (b) The obligations of the Company under this Section to compensate and
indemnify  the  Trustee  and to pay  or  reimburse  the  Trustee  for  expenses,
disbursements and advances shall constitute additional  indebtedness  hereunder.
Such  additional  indebtedness  shall be  secured by a lien prior to that of the
Debentures upon all property and funds held or collected by the Trustee as such,
except  funds  held in  trust  for the  benefit  of the  holders  of  particular
Debentures.  When the Trustee incurs expenses or renders  services in connection
with an Event of Default  specified in Section 6.01(4) or Section  6.01(5),  the
expenses  (including the reasonable charges and expenses of its counsel) and the
compensation   for  the  services  are  intended  to   constitute   expenses  of
administration  under any applicable Federal or State bankruptcy,  insolvency or
other similar law.


                                       37





         SECTION 7.07.  RIGHT OF TRUSTEE TO RELY ON  CERTIFICATE  OF OFFICERS OF
COMPANY WHERE NO OTHER  EVIDENCE  SPECIFICALLY  PRESCRIBED.  Except as otherwise
provided  in  Sections  7.01 and 7.02,  whenever  in the  administration  of the
provisions  of this  Indenture  the Trustee shall deem it necessary or desirable
that a matter be proved or established  prior to taking or suffering or omitting
to take any action hereunder, such matter
(unless other  evidence in respect  thereof be herein  specifically  prescribed)
may, in the absence of  negligence  or bad faith on the part of the Trustee,  be
deemed to be  conclusively  proved and  established by an Officers'  Certificate
delivered to the Trustee and such  certificate,  in the absence of negligence or
bad faith on the part of the  Trustee,  shall be full warrant to the Trustee for
any action taken,  suffered or omitted to be taken by it under the provisions of
this Indenture upon the faith thereof.

         SECTION 7.08.  DISQUALIFICATION;  CONFLICTING INTERESTS. If the Trustee
has or shall acquire any  "conflicting  interest"  within the meaning of Section
310(b) of the Trust  Indenture  Act,  the Trustee  and the Company  shall in all
respects  comply with the  provisions of Section  310(b) of the Trust  Indenture
Act.  Nothing  herein shall prevent the Trustee from filing with the  Commission
the  application  referred to in the second to last  paragraph  of said  Section
310(b).

         SECTION 7.09.  REQUIREMENTS FOR ELIGIBILITY OF TRUSTEE.  There shall at
all times be a Trustee with respect to the  Debentures  issued  hereunder  which
shall at all times be a corporation or banking  association  organized and doing
business  under  the  laws of the  United  States  of  America  or any  state or
territory  thereof or of the District of  Columbia,  or a  corporation  or other
Person permitted to act as trustee by the Commission, authorized under such laws
to exercise corporate trust powers,  having a combined capital and surplus of at
least 50 million U.S.  dollars,  and 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,  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.  The Company may not, nor
may any person  directly  or  indirectly  controlling,  controlled  by, or under
common  control  with the Company,  serve as a Trustee.  In case at any time the
Trustee  shall cease to be eligible in  accordance  with the  provisions of this
Section,  the Trustee shall resign immediately in the manner and with the effect
specified in Section 7.10.

         SECTION 7.10. RESIGNATION OF TRUSTEE AND APPOINTMENT OF
SUCCESSOR.

         (a) The Trustee or any successor hereafter  appointed,  may at any time
resign with respect to the  Debentures  of one or more series by giving  written
notice thereof to the Company and by transmitting notice of resignation by mail,
first class postage prepaid,  to the  Debentureholders  of such series, as their
names and addresses  appear upon the Debenture  Register.  Upon  receiving  such
notice of resignation,  the Company shall promptly  appoint a successor  trustee
with respect to Debentures of such series by written  instrument,  in duplicate,
one copy of which instrument shall be delivered to the resigning Trustee and one
copy to the

                                       38





successor trustee. If no successor trustee shall have been so appointed and have
accepted  appointment  within  60 days  after  the  mailing  of such  notice  of
resignation,  the resigning Trustee may petition, at the expense of the Company,
any court of competent  jurisdiction for the appointment of a successor  trustee
with respect to Debentures of such series, or any Debentureholder of that series
who has been a bona fide holder of a Debenture  or  Debentures  for at least six
months may,  subject to the provisions of Section 6.08, on behalf of himself and
all others similarly situated,  petition any such court for the appointment of a
successor trustee. Such court may thereupon after such notice, if any, as it may
deem proper and prescribe, appoint a successor trustee.

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

                  (1) the Trustee  shall fail to comply with the  provisions  of
Section  7.08  after  written  request   therefor  by  the  Company  or  by  any
Debentureholder who has been a bona fide holder of a Debenture or Debentures for
at least six months; or

                  (2) the Trustee shall cease to be eligible in accordance  with
the  provisions of Section 7.09 and shall fail to resign after  written  request
therefor by the Company or by any such Debentureholder; or

                  (3) the Trustee shall become incapable of acting,  or shall be
adjudged bankrupt or insolvent,  or a receiver of the Trustee or of its property
shall be  appointed,  or any public  officer shall take charge or control of the
Trustee  or of its  property  or  affairs  for the  purpose  of  rehabilitation,
conservation or liquidation,  then, in any such case, the Company may remove the
Trustee  with  respect to all  Debentures  and  appoint a  successor  trustee by
written instrument,  in duplicate,  executed by order of the Board of Directors,
one copy of which  instrument  shall be  delivered to the Trustee so removed and
one copy to the successor  trustee.  If no successor  trustee shall have been so
appointed and have accepted appointment within 30 days after the mailing of such
notice of removal,  the Trustee so removed may  petition,  at the expense of the
Company, any court of competent  jurisdiction for the appointment of a successor
trustee with respect to Debentures  of such series,  or any  Debentureholder  of
that series who has been a bona fide holder of a Debenture or Debentures  for at
least six months may,  subject to the  provisions  of Section 6.08, on behalf of
himself  and all  others  similarly  situated,  petition  any such court for the
removal of the Trustee and the  appointment of a successor  trustee.  Such court
may thereupon  after such notice,  if any, as it may deem proper and  prescribe,
remove the Trustee and appoint a successor trustee.

         (c) The  holders of a majority  in  aggregate  principal  amount of the
Debentures  of any  series at the time  outstanding  may at any time  remove the
Trustee  with  respect to such  series and appoint a  successor  trustee.  If no
successor  Trustee shall have been so appointed  and have  accepted  appointment
within 60 days after the mailing of such notice of  removal,  the Trustee  being
removed may  petition,  at the expense of the  Company,  any court of  competent
jurisdiction  for the  appointment  of a successor  Trustee  with respect to the
Debentures of such series.


                                       39





         (d) Any  resignation  or removal of the  Trustee and  appointment  of a
successor  trustee with respect to the Debentures of a series pursuant to any of
the  provisions  of this  Section  shall become  effective  upon  acceptance  of
appointment by the successor trustee as provided in Section 7.11.

         (e) Any  successor  trustee  appointed  pursuant to this Section may be
appointed  with respect to the  Debentures  of one or more series or all of such
series,  and at any time there  shall be only one  Trustee  with  respect to the
Debentures of any particular series.

         SECTION 7.11.  ACCEPTANCE BY SUCCESSOR TO TRUSTEE.

         (a) In case of the  appointment  hereunder of a successor  trustee with
respect to all  Debentures,  every such  successor  trustee so  appointed  shall
execute,  acknowledge and deliver to the Company and to the retiring  Trustee an
instrument accepting such appointment,  and thereupon the resignation or removal
of the retiring  Trustee  shall become  effective  and such  successor  trustee,
without 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 the Company or the successor  trustee,  such  retiring  Trustee  shall,  upon
payment of its charges,  execute and deliver an instrument  transferring to such
successor trustee all the rights, powers, and trusts of the retiring Trustee and
shall duly assign,  transfer and deliver to such successor  trustee all property
and money held by such retiring Trustee hereunder.

         (b) In case of the  appointment  hereunder of a successor  trustee with
respect to the Debentures of one or more (but not all) series, the Company,  the
retiring  Trustee and each  successor  trustee with respect to the Debentures of
one or more series shall  execute and deliver an indenture  supplemental  hereto
wherein each successor trustee shall accept such appointment and which shall (1)
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 Debentures of that
or those series to which the appointment of such successor trustee relates,  (2)
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  Debentures  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) add to or  change  any of the  provisions  of this  Indenture  as  shall  be
necessary  to  provide  for or  facilitate  the  administration  of  the  trusts
hereunder by more than one Trustee,  it being  understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same  trust,  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 that no Trustee shall be  responsible  for any act or
failure  to act on the  part  of any  other  Trustee  hereunder;  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,
such  retiring  Trustee  shall with respect to the  Debentures  of that or those
series  to which the  appointment  of such  successor  trustee  relates  have no
further  responsibility  for  the  exercise  of  rights  and  powers  or for the
performance  of the  duties and  obligations  vested in the  Trustee  under this
Indenture,  and each such  successor  trustee,  without any further act, deed or
conveyance, shall become vested with all the rights, powers,

                                       40





trusts and duties of the retiring Trustee with respect to the Debentures of that
or those series to which the appointment of such successor trustee relates; but,
on request of the Company or any successor Trustee,  such retiring Trustee shall
duly  assign,  transfer  and deliver to such  successor  trustee,  to the extent
contemplated by such supplemental indenture, the property and money held by such
retiring  Trustee  hereunder  with  respect to the  Debentures  of that or those
series to which the appointment of such successor trustee relates.

         (c) Upon  request of any such  successor  trustee,  the  Company  shall
execute  any and all  instruments  for more fully and  certainly  vesting in and
confirming to such successor trustee all such rights,  power and trusts referred
to in paragraph (a) or (b) of this Section 7.11, 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.

         (e) Upon  acceptance of appointment by a successor  trustee as provided
in this  Section  7.11,  the  successor  trustee  shall  transmit  notice of the
succession of such trustee  hereunder by mail, first class postage  prepaid,  to
the  Debentureholders,  as their names and  addresses  appear upon the Debenture
Register.

         SECTION  7.12.  SUCCESSOR  TO  TRUSTEE  BY  MERGER,   CONSOLIDATION  OR
SUCCESSION TO BUSINESS.  Any corporation or banking  association  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, without the execution or filing of any paper or
any further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.  In case any Debentures shall have been authenticated,
but not  made  available  for  delivery,  by the  Trustee  then in  office,  any
successor by merger,  conversion or consolidation to such authenticating Trustee
may adopt such  authentication and make available for delivery the Debentures so
authenticated  with the same  effect as if such  successor  Trustee  had  itself
authenticated such Debentures.

         SECTION 7.13.  PREFERENTIAL  COLLECTION OF CLAIMS  AGAINST THE COMPANY.
The  Trustee  shall  comply  with  Section  311(a) of the Trust  Indenture  Act,
excluding  any creditor  relationship  described in Section  311(b) of the Trust
Indenture  Act. A Trustee who has resigned or been  removed  shall be subject to
Section  311(a) of the Trust  Indenture  Act to the extent  included  therein as
though such resignation or removal, as the case may be, had not occurred.

                                    ARTICLE 8
                            CONCERNING THE DEBENTURES


                                       41




         SECTION 8.01.  EVIDENCE OF ACTION BY DEBENTUREHOLDERS.  Whenever in
this  Indenture  it is  provided  that the  holders of a majority  or  specified
percentage  in  aggregate  principal  amount of the  Debentures  of a particular
series may take any action  (including the making of any demand or request,  the
giving of any notice  consent or waiver or the taking of any other  action)  the
fact that at the time of taking any such action the holders of such  majority or
specified  percentage of that series have joined therein may be evidenced by any
instrument  or any number of  instruments  of  similar  tenor  executed  by such
holders of Debentures of that series in person or by agent or proxy appointed in
writing.

         If the Company  shall solicit from the  Debentureholders  of any series
any request, demand, authorization,  direction, notice, consent, waiver or other
action,   the  Company  may,  at  its  option,  as  evidenced  by  an  Officers'
Certificate,  fix in advance a record date for such series for the determination
of  Debentureholders  entitled  to give  such  request,  demand,  authorization,
direction,  notice,  consent, waiver or other action, but the Company shall have
no  obligation to do so. If such a record date is fixed,  such request,  demand,
authorization,  direction,  notice, consent, waiver or other action may be given
before or after the record date, but only the  Debentureholders of record at the
close of business on the record date shall be deemed to be Debentureholders  for
the purposes of determining whether Debentureholders of the requisite proportion
of Outstanding  Debentures of that series have authorized or agreed or consented
to such request, demand,  authorization,  direction,  notice, consent, waiver or
other  action,  and for that purpose the  Outstanding  Debentures of that series
shall be computed as of the record date;  provided  that no such  authorization,
agreement or consent by such Debentureholders on the record date shall be deemed
effective  unless it shall become  effective  pursuant to the provisions of this
Indenture not later than six months after the record date.

         SECTION  8.02.  PROOF OF  EXECUTION  OF  INSTRUMENTS  AND OF HOLDING OF
DEBENTURES.  Subject to the  provisions of Sections 7.01 and 7.02,  proof of the
execution of any  instrument by a  Debentureholder  (such proof will not require
notarization)  or his agent or proxy and proof of the  holding  by any person of
any of the Debentures shall be sufficient if made in the following manner;

         (a) The fact  and  date of the  execution  by any  such  person  of any
instrument may be proved in any reasonable manner acceptable to the Trustee.

         (b) The  ownership  of  Debentures  shall be  proved  by the  Debenture
Register of such  Debentures  or by a  certificate  of the  Debenture  Registrar
thereof.

         (c) The  Trustee  may  require  such  additional  proof  of any  matter
referred to in this Section as it shall deem necessary.

         SECTION 8.03. WHO MAY BE DEEMED OWNERS OF DEBENTURES.  Prior to the due
presentment  for  registration  of transfer of any Debenture,  the Company,  the
Trustee,  any paying agent and any  Debenture  Registrar  may deem and treat the
person in whose name such  Debenture  shall be registered  upon the books of the
Company as the absolute owner of such  Debenture  (whether or not such Debenture
shall be overdue and notwithstanding any notice of

                                       42





ownership or writing thereon made by anyone other than the Debenture  Registrar)
for the  purpose of  receiving  payment of or on  account of the  principal  of,
premium,  if any, and (subject to Section 2.03)  interest on such  Debenture and
for all other  purposes;  and neither the Company nor the Trustee nor any paying
agent  nor any  Debenture  Registrar  shall be  affected  by any  notice  to the
contrary.

         SECTION 8.04.  DEBENTURES OWNED BY THE COMPANY OR CONTROLLED
OR CONTROLLING COMPANIES DISREGARDED FOR CERTAIN PURPOSES.  In
determining  whether the holders of the requisite  aggregate principal amount of
Debentures of a particular  series have concurred in any  direction,  consent or
waiver under this  Indenture,  Debentures  of that series which are owned by the
Company  or any  other  obligor  on the  Debentures  of  that  series  or by any
Subsidiary  of the Company or of such other  obligor on the  Debentures  of that
series shall be disregarded  and deemed not to be Outstanding for the purpose of
any such  determination,  except that for the purpose of determining whether the
Trustee shall be protected in relying on any such direction,  consent or waiver,
only  Debentures  of such  series  which a  Responsible  Officer of the  Trustee
actually knows are so owned shall be so  disregarded.  Debentures so owned which
have been pledged in good faith may be regarded as outstanding  for the purposes
of this  Section,  if the pledgee  shall  establish to the  satisfaction  of the
Trustee the pledgee's  right so to act with respect to such  Debentures and that
the pledgee is not a person directly or indirectly  controlling or controlled by
or under  direct or indirect  common  control with the Company or any such other
obligor.  In case of a dispute as to such  right,  any  decision  by the Trustee
taken upon the advice of counsel shall be full protection to the Trustee.

         SECTION  8.05.  INSTRUMENTS  EXECUTED BY  DEBENTUREHOLDERS  BIND FUTURE
HOLDERS.  At any time prior to (but not after) the evidencing to the Trustee, as
provided  in Section  8.01,  of the  taking of any action by the  holders of the
majority or  percentage  in aggregate  principal  amount of the  Debentures of a
particular  series  specified in this Indenture in connection  with such action,
any holder of a Debenture  of that series  which is shown by the  evidence to be
included in the  Debentures  the holders of which have  consented to such action
may, by filing  written  notice with the  Trustee,  and upon proof of holding as
provided in Section 8.02,  revoke such action so far as concerns such Debenture.
Except as aforesaid any such action taken by the holder of any  Debenture  shall
be  conclusive  and  binding  upon such  holder and upon all future  holders and
owners of such Debenture,  and of any Debenture issued in exchange therefor,  on
registration of transfer thereof or in place thereof, irrespective of whether or
not any notation in regard thereto is made upon such Debenture. Any action taken
by the holders of the majority or  percentage in aggregate  principal  amount of
the Debentures of a particular  series specified in this Indenture in connection
with such action shall be conclusively binding upon the Company, the Trustee and
the holders of all the Debentures of that series.

                                    ARTICLE 9
                             SUPPLEMENTAL INDENTURES

         SECTION 9.01.  PURPOSES FOR WHICH SUPPLEMENTAL INDENTURE MAY BE
ENTERED INTO WITHOUT CONSENT OF DEBENTUREHOLDERS.  In addition to any
supplemental indenture otherwise authorized by this Indenture, the Company and
the Trustee

                                       43





may from time to time and at any time  enter  into an  indenture  or  indentures
supplemental  hereto  (which  shall  conform  to the  provisions  of  the  Trust
Indenture Act as then in effect),  without the consent of the  Debentureholders,
for one or more of the following purposes:

         (a) to evidence the  succession of another  corporation or other entity
to the Company,  and the assumption by any such successor of the  obligations of
the  Company  contained  herein or  otherwise  established  with  respect to the
Debentures;

         (b) to add further  covenants,  restrictions,  conditions or provisions
for the  protection of the holders of the Debentures of all or any series as the
Board of Directors  and the Trustee shall  consider to be for the  protection of
the holders of Debentures of all or any series,  and to make the occurrence,  or
the  occurrence  and  continuance,  of a  default  in  any  of  such  additional
covenants,  restrictions,  conditions  or  provisions  a default  or an Event of
Default with respect to such series  permitting the enforcement of all or any of
the several remedies  provided in this Indenture as herein set forth;  provided,
however, that in respect of any such additional covenant, restriction, condition
or provision such supplemental  indenture may provide for a particular period of
grace after default  (which period may be shorter or longer than that allowed in
the case of other  defaults)  or may provide for an immediate  enforcement  upon
such  default  or may limit the  remedies  available  to the  Trustee  upon such
default  or may  limit the  right of the  holders  of a  majority  in  aggregate
principal amount of the Debentures of such series to waive such default;

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

         (d) to add  to,  change  or  eliminate  any of the  provisions  of this
Indenture,  provided that any such addition,  change or elimination shall become
effective  only when there is no  Debenture  outstanding  of any series  created
prior to the execution of such  supplemental  indenture which is entitled to the
benefit of such provision;

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

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

         (g) to qualify or maintain  qualification  of this Indenture  under the
Trust Indenture Act;


                                       44





         (h)      to establish the form or terms of Debentures of any series as
permitted by Section 2.01; or

         (i) to make any  addition,  change or  elimination  of any provision of
this Indenture that does not adversely affect the rights of any  Debentureholder
in any material respect.

         The  Trustee  is  hereby  authorized  to join with the  Company  in the
execution  of  any  such  supplemental  indenture,   and  to  make  any  further
appropriate agreements and stipulations which may be therein contained,  but the
Trustee  shall not be obligated  to, but may in its  discretion,  enter into any
such  supplemental  indenture which affects the Trustee's own rights,  duties or
immunities under this Indenture or otherwise.

         Any supplemental indenture authorized by the provisions of this Section
may be  executed  by the  Company  and the  Trustee  without  the consent of the
holders of any of the Debentures at the time outstanding, notwithstanding any of
the provisions of Section 9.02.

         SECTION   9.02.    MODIFICATION    OF   INDENTURE   WITH   CONSENT   OF
DEBENTUREHOLDERS.  With the consent  (evidenced  as provided in Section 8.01) of
the holders of not less than a majority  in  aggregate  principal  amount of the
Debentures of each series affected by such supplemental  indenture or indentures
at the time  outstanding  (and, in the case of any series of Debentures  held as
trust assets of a Litchfield  Capital Trust and with respect to which a Security
Exchange has not theretofore occurred,  such consent of holders of the Preferred
Securities and the Common Securities of such Litchfield  Capital Trust as may be
required under the Declaration of Trust of such Litchfield  Capital Trust),  the
Company  and the  Trustee  may from time to time and at any time  enter  into an
indenture  or  indentures  supplemental  hereto  (which  shall  conform  to  the
provisions  of the Trust  Indenture  Act as then in effect)  for the  purpose of
adding any  provisions  to or changing in any manner or  eliminating  any of the
provisions of this Indenture or of any supplemental indenture or of modifying in
any manner the rights of the holders of the Debentures of such series under this
Indenture;  provided,  however,  that no such  supplemental  indenture shall (i)
extend  the fixed  maturity  of any  Debentures  of any  series,  or reduce  the
principal  amount  thereof,  or reduce the rate or extend the time of payment of
interest  thereon,  or reduce any premium  payable upon the redemption  thereof,
without the consent of the holder of each  Debenture  so affected or (ii) reduce
the  aforesaid  percentage of  Debentures,  the holders of which are required to
consent to any such supplemental  indenture,  without the consent of the holders
of each  Debenture  (and, in the case of any series of Debentures  held as trust
assets of a  Litchfield  Capital  Trust  and with  respect  to which a  Security
Exchange  has not  theretofore  occurred,  such  consent  of the  holders of the
Preferred  Securities and the Common Securities of such Litchfield Capital Trust
as may be required  under the  Declaration of Trust of such  Litchfield  Capital
Trust) then outstanding and affected thereby.

         Upon the request of the  Company,  and upon the filing with the Trustee
of evidence of the consent of  Debentureholders  (and, in the case of any series
of  Debentures  held as trust  assets  of a  Litchfield  Capital  Trust and with
respect to which a Security Exchange has not theretofore occurred,  such consent
of  holders  of the  Preferred  Securities  and the  Common  Securities  of such
Litchfield  Capital Trust as may be required  under the  Declaration of Trust of
such Litchfield

                                       45





Capital Trust) required to consent thereto as aforesaid,  the Trustee shall join
with the Company in the  execution of such  supplemental  indenture  unless such
supplemental  indenture  affects the Trustee's own rights,  duties or immunities
under  this  Indenture  or  otherwise,  in  which  case the  Trustee  may in its
discretion but shall not be obligated to enter into such supplemental indenture.

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

         Promptly  after the  execution  by the  Company  and the Trustee of any
supplemental  indenture pursuant to the provisions of this Section,  the Trustee
shall transmit by mail, first class postage prepaid, a notice,  setting forth in
general   terms  the   substance  of  such   supplemental   indenture,   to  the
Debentureholders  of all series  affected  thereby as their names and  addresses
appear  upon the  Debenture  Register.  Any  failure of the Trustee to mail such
notice, or any defect therein,  shall not, however,  in any way impair or affect
the validity of any such supplemental indenture.

         SECTION 9.03. EFFECT OF SUPPLEMENTAL INDENTURES.  Upon the execution of
any  supplemental  indenture  pursuant to the  provisions  of this Article or of
Section 10.01,  this  Indenture  shall,  with respect to such series,  be and be
deemed to be modified and amended in  accordance  therewith  and the  respective
rights,  limitations of rights,  obligations,  duties and immunities  under this
Indenture  of the  Trustee,  the Company and the  holders of  Debentures  of the
series affected thereby shall  thereafter be determined,  exercised and enforced
hereunder  subject in all respects to such  modifications and amendments and all
the terms and  conditions  of any such  supplemental  indenture  shall be and be
deemed to be part of the terms and  conditions of this Indenture for any and all
purposes.

         SECTION 9.04.  DEBENTURES MAY BEAR NOTATION OF CHANGES BY  SUPPLEMENTAL
INDENTURES.  Debentures  of any series,  affected by a  supplemental  indenture,
authenticated and delivered after the execution of such  supplemental  indenture
pursuant  to the  provisions  of this  Article or of Section  10.01,  may bear a
notation  in  form  approved  by the  Company,  provided  such  form  meets  the
requirements of any exchange upon which such series may be listed or traded,  as
to any matter provided for in such supplemental  indenture. If the Company shall
so determine,  new  Debentures of that series so modified as to conform,  in the
opinion  of the  Board  of  Directors,  to any  modification  of this  Indenture
contained  in any such  supplemental  indenture  may be prepared by the Company,
authenticated  by the Trustee and  delivered in exchange for the  Debentures  of
that series then outstanding.

         SECTION  9.05.  OPINION  OF  COUNSEL.  The  Trustee,   subject  to  the
provisions  of  Sections  7.01 and 7.02,  may  receive  an Opinion of Counsel as
conclusive  evidence that any supplemental  indenture  executed  pursuant hereto
complies with the requirements of this Article 9.

                                   ARTICLE 10
                    CONSOLIDATION, MERGER, SALE OR CONVEYANCE

                                       46






         SECTION 10.01.  COMPANY MAY  CONSOLIDATE,  ETC. ON CERTAIN  TERMS.  The
Company  shall not  consolidate  with or merge into any other  Person or convey,
transfer or lease its properties and assets  substantially as an entirety to any
other Person,  and the Company shall not permit any other Person to  consolidate
with or merge into the Company, unless:

         (a) either the  Company  shall be the  continuing  corporation,  or the
corporation  (if other than the Company)  formed by such  consolidation  or into
which the Company is merged or to which the properties and assets of the Company
substantially  as an entity are  transferred  or leased shall be a  corporation,
limited liability company, partnership or trust organized and existing under the
laws of the United  States of America or any state  thereof or the  District  of
Columbia  and shall  expressly  assume,  by an  indenture  supplemental  hereto,
executed and delivered to the Trustee, in form satisfactory to the Trustee,  all
the obligations of the Company under the Debentures and this Indenture; and

         (b)  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 occurred and be continuing.

         SECTION  10.02.  SUCCESSOR  CORPORATION   SUBSTITUTED.   The  successor
corporation  formed by such consolidation or into which the Company is merged or
to which such transfer or lease is made shall succeed to and be substituted for,
and may exercise every right and power of, the Company under this Indenture with
the same effect as if such successor  corporation  had been named as the Company
herein,  and  thereafter  (except in the case of a lease to another  Person) the
predecessor corporation shall be relieved of all obligations and covenants under
the  Indenture  and the  Debentures  and,  in the event of such  conveyance,  or
transfer, any such predecessor corporation may be dissolved and liquidated.

         SECTION  10.03.  OPINION  OF  COUNSEL.  The  Trustee,  subject  to  the
provisions  of  Sections  7.01 and 7.02,  may  receive  an Opinion of Counsel as
conclusive  evidence  that any such  consolidation,  merger,  sale,  conveyance,
transfer  or  other  disposition,  and any  such  assumption,  comply  with  the
provisions of this Article.

                                   ARTICLE 11
            SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS

         SECTION 11.01.  SATISFACTION AND DISCHARGE OF INDENTURE.

         (A) If at any time (a) the Company shall have paid or caused to be paid
the principal  of,  premium,  if any, and interest on all the  Debentures of any
series  Outstanding  hereunder  (other than Debentures of such series which have
been destroyed,  lost or stolen and which have been replaced or paid as provided
in Section 2.07) as and when the same shall have become due and payable,  or (b)
the Company shall have delivered to the Trustee for  cancellation all Debentures
of any series  theretofore  authenticated  (other  than any  Debentures  of such
series which shall have been destroyed, lost or stolen and which shall have been
replaced or paid as provided in Section

                                       47





2.07) or (c) (i) all the Debentures of any series not  theretofore  delivered to
the Trustee for  cancellation  shall have  become due and  payable,  or by their
terms  will  become  due and  payable  within  one year or are to be called  for
redemption  within one year under  arrangements  satisfactory to the Trustee for
the giving of notice of redemption,  and (ii) the Company shall have irrevocably
deposited or caused to be  deposited  with the Trustee as trust funds the entire
amount in cash (other than moneys  repaid by the Trustee or any paying  agent to
the  Company  in  accordance  with  Section  11.04) or  Government  Obligations,
maturing as to principal  and interest at such times and in such amounts as will
insure the  availability  of cash, or a combination  thereof,  sufficient in the
opinion  of a  nationally  recognized  firm of  independent  public  accountants
expressed in a written  certification  thereof delivered to the Trustee,  to pay
(A) the principal of,  premium,  if any, and interest on all  Debentures of such
series on each date that such  principal  or interest is due and payable and (B)
any mandatory  sinking fund payments on the dates on which such payments are due
and payable in accordance  with the terms of the Indenture and the Debentures of
such series; and if, in any such case, the Company shall also pay or cause to be
paid all other sums payable hereunder by the Company,  then this Indenture shall
cease to be of  further  effect  (except  as to (i)  rights of  registration  of
transfer and exchange of Debentures  of such series and the  Company's  right of
optional redemption, if any, (ii) substitution of mutilated,  defaced, destroyed
lost or stolen  Debentures,  (iii)  rights of holders of  Debentures  to receive
payments of principal thereof and interest thereon, upon the original stated due
dates  therefor  (but  not  upon  acceleration),  and  remaining  rights  of the
Debentureholders  to receive mandatory  sinking fund payments,  if any, (iv) the
rights,  obligations,  duties and immunities of the Trustee  hereunder,  (v) the
rights of the holders of Debentures of such series as beneficiaries  hereof with
respect to the property so deposited  with the Trustee  payable to all or any of
them and  (vi) the  obligations  of the  Company  under  Section  4.02)  and the
Trustee, on demand of the Company accompanied by an Officers' Certificate and an
Opinion of Counsel and at the cost and  expense of the  Company,  shall  execute
proper  instruments  acknowledging  such  satisfaction of and  discharging  this
Indenture;  provided, that the rights of the Debentureholders to receive amounts
in respect of principal of, premium, if any, and interest on the Debentures held
by them shall not be delayed longer than required by  then-applicable  mandatory
rules or policies of any securities  exchange or automated quotation system upon
which the Debentures  are listed or traded.  The Company agrees to reimburse the
Trustee for any costs or expenses  thereafter  reasonably and properly  incurred
and to  compensate  the  Trustee  for any  services  thereafter  reasonably  and
properly  rendered  by the  Trustee in  connection  with this  Indenture  or the
Debentures of such series.

         (B) The  following  provisions  shall apply to the  Debentures  of each
series unless specifically otherwise provided in a Board Resolution or indenture
supplemental  hereto provided pursuant to Section 2.01. In addition to discharge
of the Indenture pursuant to the next preceding paragraph,  the Company shall be
deemed to have paid and discharged the entire indebtedness on all the Debentures
of a series on the date of the deposit  referred to in  subparagraph  (a) below,
and the  provisions  of this  Indenture  with respect to the  Debentures of such
series shall no longer be in effect (except as to (i) rights of  registration of
transfer and exchange of Debentures  of such series and the  Company's  right of
optional redemption, if any, (ii) substitution of mutilated, defaced, destroyed,
lost or stolen  Debentures,  (iii)  rights of holders of  Debentures  to receive
payments of principal thereof and interest thereon, upon the original stated due
dates therefor (but not upon

                                       48





acceleration),  and  remaining  rights of the holders of  Debentures  to receive
mandatory sinking fund payments,  if any, (iv) the rights,  obligations,  duties
and  immunities  of the  Trustee  hereunder,  (v) the  rights of the  Holders of
Debentures  as  beneficiaries  hereof with  respect to the property so deposited
with the Trustee  payable to all or any of them and (vi) the  obligations of the
Company  under  Section  4.02) and the  Trustee,  at the expense of the Company,
shall at the Company's  request,  execute proper  instruments  acknowledging the
same, if

                  (a)  with   reference  to  this   provision  the  Company  has
irrevocably  deposited or caused to be irrevocably deposited with the Trustee as
trust funds in trust, specifically pledged as security for, and dedicated solely
to, the benefit of the holders of the  Debentures  of such series (i) cash in an
amount, or (ii) Governmental  Obligations  maturing as to principal and interest
at such times and in such  amounts as will  insure the  availability  of cash or
(iii)  a  combination  thereof,  sufficient,  in  the  opinion  of a  nationally
recognized  firm  of  independent  public  accountants  expressed  in a  written
certification  thereof  delivered to the Trustee,  to pay (A) the  principal of,
premium, if any, and interest on all Debentures of such series on each date that
such principal or interest is due and payable and (B) any mandatory sinking fund
payments on the dates on which such  payments are due and payable in  accordance
with the terms of the Indenture and the Debentures of such series;

                  (b) such deposit will not result in a breach or violation  of,
or constitute a default under,  any agreement or instrument to which the Company
is a party or by which it is bound;

                  (c) the  Company  has  delivered  to the Trustee an Opinion of
Counsel  based on the fact that (x) the Company has received  from, or there has
been published by, the Internal  Revenue  Service a ruling or (y) since the date
hereof,  there has been a change in the  applicable  Federal  income tax law, in
either case to the effect that, and such opinion shall confirm that, the holders
of the  Debentures  of such series will not recognize  income,  gain or loss for
Federal  income  tax  purposes  as a  result  of such  deposit,  defeasance  and
discharge  and will be subject to Federal  income tax on the same  amount and in
the same  manner  and at the same  times,  as would  have  been the case if such
deposit, defeasance and discharge had not occurred;

                  (d) the Company  has  delivered  to the  Trustee an  Officers'
Certificate  and an  Opinion  of  Counsel,  each  stating  that  all  conditions
precedent provided for relating to the defeasance contemplated by this provision
have been complied with; and

                  (e) no event or  condition  shall exist that,  pursuant to the
provisions  of Section  14.02 or 14.03,  would  prevent the Company  from making
payments of the principal of, premium,  if any, or interest on the Debentures of
such series on the date of such deposit.

         SECTION 11.02. APPLICATION BY TRUSTEE OF FUNDS DEPOSITED FOR PAYMENT OF
DEBENTURES.  Subject to Section 11.04, all moneys deposited with the Trustee (or
other  trustee)  pursuant to Section 11.01 shall be held in trust and applied by
it to the payment,  either  directly or through any paying agent  (including the
Company  acting as its own  paying  agent),  to the  Holders  of the  particular
Debentures of such series for the payment or

                                       49





redemption  of which such moneys have been  deposited  with the Trustee,  of all
sums due and to become due thereon for principal  and  interest;  but such money
need not be segregated from other funds except to the extent required by law.

         SECTION 11.03.  REPAYMENT OF MONEYS HELD BY THE PAYING AGENT.  In
connection with the satisfaction and discharge of this Indenture with respect to
Debentures  of any series,  all moneys  then held by any paying  agent under the
provisions of this  Indenture  with respect to such series of Debentures  shall,
upon demand of the Company, be repaid to it or paid to the Trustee and thereupon
such paying agent shall be released from all further  liability  with respect to
such moneys.

         SECTION  11.04.  REPAYMENT  OF MONEYS HELD BY THE  TRUSTEE.  Any moneys
deposited with or paid to the Trustee or any paying agent for the payment of the
principal  of or  interest  on any  Debenture  of any series and not applied but
remaining  unclaimed  for two years after the date upon which such  principal or
interest shall have become due and payable,  shall,  upon the written request of
the Company and unless otherwise required by mandatory  provisions of applicable
escheat or abandoned or unclaimed  property law, be repaid to the Company by the
Trustee for such series or such paying agent,  and the Holder of the  Debentures
of such series  shall,  unless  otherwise  required by mandatory  provisions  of
applicable escheat or abandoned or unclaimed property laws, thereafter look only
to the Company for any payment which such holder may be entitled to collect, and
all  liability  of the Trustee or any paying  agent with  respect to such moneys
shall thereupon cease; provided, however, that the Trustee or such paying agent,
before  being  required  to make any  such  repayment  with  respect  to  moneys
deposited with it for any payment  series,  shall at the expense of the Company,
mail by  first-class  mail to holders of such  Debentures at their  addresses as
they shall appear on the Debenture Register, notice, that such moneys remain and
that, after a date specified therein,  which shall not be less than 30 days from
the date of such mailing or  publication,  any  unclaimed  balance of such money
then remaining will be repaid to the Company.

         SECTION 11.05.  INDEMNIFICATION  RELATING TO GOVERNMENTAL  OBLIGATIONS.
The Company shall pay and  indemnify  the Trustee  against any tax, fee or other
charge imposed on or assessed  against the  Governmental  Obligations  deposited
pursuant to Section  11.01 or the  principal or interest  received in respect of
such obligations.

                                   ARTICLE 12
         IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS

         SECTION 12.01.  INCORPORATORS, STOCKHOLDERS, OFFICERS AND
DIRECTORS OF COMPANY EXEMPT FROM INDIVIDUAL LIABILITY.  No recourse
under or upon any obligation, covenant or agreement of this Indenture, or of any
Debenture, or for any claim based thereon or otherwise in respect thereof, shall
be had against any incorporator, stockholder, officer or director, past, present
or  future  as  such,  of  the  Company  or  of  any  predecessor  or  successor
corporation,  either directly or through the Company or any such  predecessor or
successor corporation, whether by virtue of any constitution, statute or rule of
law, or by the  enforcement of any assessment or penalty or otherwise;  it being
expressly understood

                                       50



that this Indenture and the obligations  issued  hereunder are solely  corporate
obligations, and that no such personal liability whatever shall attach to, or is
or shall be incurred by, the incorporators,  stockholders, officers or directors
as such, of the Company or of any predecessor or successor  corporation,  or any
of them, because of the creation of the indebtedness hereby authorized, or under
or by reason of the  obligations,  covenants  or  agreements  contained  in this
Indenture or in any of the Debentures or implied therefrom; and that any and all
such  personal  liability  of every name and nature,  either at common law or in
equity or by constitution or statute, of, and any and all such rights and claims
against,  every such  incorporator,  stockholder,  officer or  director as such,
because of the creation of the indebtedness  hereby  authorized,  or under or by
reason of the obligations,  covenants or agreements  contained in this Indenture
or in any of the Debentures or implied  therefrom,  are hereby  expressly waived
and released as a condition  of, and as a  consideration  for, the  execution of
this Indenture and the issuance of such Debentures.

                                   ARTICLE 13
                            MISCELLANEOUS PROVISIONS

         SECTION  13.01.  SUCCESSORS  AND ASSIGNS OF COMPANY BOUND BY INDENTURE.
All the  covenants,  stipulations,  promises and  agreements  in this  Indenture
contained by or on behalf of the Company shall bind its  successors and assigns,
whether so expressed or not.

         SECTION 13.02. ACTS OF BOARD, COMMITTEE OR OFFICER OF SUCCESSOR COMPANY
VALID.  Any act or proceeding by any provision of this  Indenture  authorized or
required  to be done or  performed  by any  board,  committee  or officer of the
Company  shall and may be done and  performed  with like force and effect by the
corresponding  board,  committee or officer of any corporation that shall at the
time be the lawful sole successor of the Company.

         SECTION 13.03.  SURRENDER OF POWERS OF THE COMPANY.  The Company by
instrument  in writing  executed  by  authority  of  two-thirds  of its Board of
Directors and delivered to the Trustee may surrender any of the powers  reserved
to the Company and thereupon such power so surrendered  shall  terminate both as
to the Company and as to any successor corporation.

         SECTION  13.04.  REQUIRED  NOTICES  OR  DEMANDS  MAY BE SERVED BY MAIL.
Except as otherwise expressly provided herein, any notice or demand which by any
provision  of this  Indenture  is required or permitted to be given or served by
the Trustee or by the holders of Debentures to or on the Company may be given or
served by being deposited first class postage prepaid in a post-office letterbox
addressed  (until  another  address is filed in writing by the Company  with the
Trustee), as follows:  Litchfield Financial  Corporation,  430 Main Street, P.O.
Box 488, Williamstown,  Massachusetts 01267, Attention: Corporate Secretary. Any
notice, election,  request or demand by the Company or any Debentureholder to or
upon the Trustee shall be deemed to have been  sufficiently  given or made,  for
all purposes,  if given or made in writing at the Corporate  Trust Office of the
Trustee.


                                       51





         SECTION  13.05.  INDENTURE AND DEBENTURES TO BE CONSTRUED IN ACCORDANCE
WITH LAWS OF THE STATE OF NEW YORK.  This Indenture and each Debenture  shall be
deemed to be a contract made under the laws of the State of New York, and
for all purposes  shall be construed in  accordance  with the laws of said State
(without regard to principles of conflicts of laws thereof).

         SECTION  13.06.  OFFICER'S  CERTIFICATE  AND  OPINION  OF COUNSEL TO BE
FURNISHED UPON  APPLICATION OR DEMANDS BY COMPANY;  STATEMENTS TO BE INCLUDED IN
EACH  CERTIFICATE  OR OPINION  WITH  RESPECT TO  COMPLIANCE  WITH  CONDITION  OR
COVENANT.

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

         (b) Each  certificate  or opinion  provided for in this  Indenture  and
delivered to the Trustee with respect to compliance with a condition or covenant
in this  Indenture  (other  than the  certificate  provided  pursuant to Section
5.03(d) of this Indenture)  shall include (1) a statement that the person making
such  certificate  or opinion has read such covenant or  condition;  (2) a brief
statement as to the nature and scope of the  examination or  investigation  upon
which the  statements or opinions  contained in such  certificate or opinion are
based;  (3) a statement  that,  in the opinion of such person,  he has made such
examination  or  investigation  as is  necessary  to enable  him to  express  an
informed  opinion as to  whether  or not such  covenant  or  condition  has been
complied  with; and (4) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.

         SECTION 13.07.  PAYMENTS DUE ON SUNDAYS OR HOLIDAYS.  Except as
provided  pursuant to Section 2.01  pursuant to a Board  Resolution,  and as set
forth in an Officers'  Certificate,  or  established  in one or more  indentures
supplemental  to the  Indenture,  in any  case  where  the date of  maturity  of
interest  or  principal  of any  Debenture  or the  date  of  redemption  of any
Debenture shall not be a Business Day then payment of interest or principal (and
premium,  if any) may be made on the next succeeding Business Day, with the same
force and effect as if made on the nominal date of maturity or  redemption,  and
no interest shall accrue for the period after such nominal date.

         SECTION 13.08.  PROVISIONS  REQUIRED BY TRUST  INDENTURE ACT OF 1939 TO
CONTROL.  If and to the extent  that any  provision  of this  Indenture  limits,
qualifies  or  conflicts  with  the  duties  imposed  by  Sections  310 to  317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.


                                       52





         SECTION  13.09.  INDENTURE  MAY BE EXECUTED BY ITS  COUNTERPARTS.  This
Indenture may be executed in any number of counterparts,  each of which shall be
an original;  but such  counterparts  shall together  constitute but one and the
same instrument.

         SECTION 13.10. SEPARABILITY OF INDENTURE PROVISIONS. In case any one or
more of the  provisions  contained in this Indenture or in the Debentures of any
series shall for any reason be held to be invalid,  illegal or  unenforceable in
any respect,  such invalidity,  illegality or unenforceability  shall not affect
any other provisions of this Indenture or of such Debentures, but this Indenture
and  such  Debentures  shall be  construed  as if such  invalid  or  illegal  or
unenforceable provision had never been contained herein or therein.

         SECTION 13.11.  ASSIGNMENT BY COMPANY TO A SUBSIDIARY OR
AFFILIATE.  The  Company  will have the right at all times to assign  any of its
rights or  obligations  under this  Indenture to a Subsidiary  or an  Affiliate;
provided  that,  in the event of any such  assignment,  the Company  will remain
jointly and severally liable for all such obligations. Subject to the foregoing,
this Indenture is binding upon and inures to the benefit of the parties  thereto
and their respective successors and assigns. This Indenture may not otherwise be
assigned by the parties hereto (other than pursuant to Article 10).

         SECTION  13.12.   HOLDERS  OF  PREFERRED   SECURITIES  AS  THIRD  PARTY
BENEFICIARIES  OF THE INDENTURE;  HOLDERS OF PREFERRED  SECURITIES MAY INSTITUTE
LEGAL PROCEEDINGS AGAINST THE COMPANY IN CERTAIN CASES.
The Company  acknowledges  that,  prior to a Security  Exchange  with respect to
Debentures of any series held as trust assets of a Litchfield  Capital Trust, if
the  Property  Trustee of such  Litchfield  Capital  Trust  fails to enforce its
rights under this  Indenture as the holder of the Debentures of a series held as
trust  assets of such  Litchfield  Capital  Trust,  any holder of the  Preferred
Securities of such Litchfield Capital Trust may, to the fullest extent permitted
by law, institute legal proceedings directly against the Company to enforce such
Property  Trustee's  rights under this Indenture  without first  instituting any
legal  proceedings  against such Property Trustee or any other Person;  provided
that,  if an Event of Default has occurred and is  continuing  and such event is
attributed  to the failure of the Company to pay  interest or  principal  on the
Debentures  on the date such  interest or principal is otherwise  payable (or in
the case of  redemption,  on the  redemption  date),  then a holder of Preferred
Securities of such Litchfield  Capital Trust may directly institute a proceeding
for enforcement of payment to such holder of the principal of or interest on the
Debentures having a principal amount equal to the aggregate  liquidation  amount
of the  Preferred  Securities  of such holder (a "Holder  Direct  Action") on or
after the respective due date specified in the  Debentures.  In connection  with
such Holder Direct Action,  the Company will be subrogated to the rights of such
holder of Preferred  Securities to the extent of any payment made by the Company
to such holders of Preferred Securities in such Holder Direct Action.  Except as
provided in the preceding sentences, the holders of Preferred Securities of such
Litchfield  Capital Trust will not be able to exercise directly any other remedy
available to the holders of the Debentures.

                                   ARTICLE 14
                           SUBORDINATION OF DEBENTURES

                                       53






         SECTION  14.01.  AGREEMENT TO  SUBORDINATE.  The Company  covenants and
agrees,  and each  Debentureholder  issued  hereunder by his acceptance  thereof
likewise  covenants and agrees,  that all Debentures  shall be issued subject to
the  provisions  of this  Article  14; and each person  holding  any  Debenture,
whether upon original  issue or upon  transfer,  assignment or exchange  thereof
accepts and agrees to be bound by such provisions.

         The payment by the Company of the  principal of,  premium,  if any, and
interest on all  Debentures  issued  hereunder  shall,  to the extent and in the
manner  hereinafter set forth, be subordinated and junior in right of payment to
all Senior Debt, whether outstanding at the date of this Indenture or thereafter
incurred.

         No  provision of this Article 14 shall  prevent the  occurrence  of any
Default or Event of Default hereunder.

         SECTION  14.02.  DEFAULT  ON SENIOR  DEBT.  In the event and during the
continuation of any default by the Company in the payment of principal, premium,
interest or any other  payment due on any Senior Debt,  or in the event that the
maturity of any Senior Debt has been accelerated because of a default,  then, in
either  case,  no  payment  shall be made by the  Company  with  respect  to the
principal (including  redemption payments) of or premium, if any, or interest on
the Debentures  until such default shall have been cured or waived in writing or
shall have  ceased to exist or such Senior  Debt shall have been  discharged  or
paid in full.

         In the event of the  acceleration  of the  maturity of the  Debentures,
then no payment  shall be made by the  Company  with  respect  to the  principal
(including  redemption  payments)  of or  premium,  if any,  or  interest on the
Debentures  until the holders of all Senior Debt outstanding at the time of such
acceleration  shall receive  payment in full of such Senior Debt  (including any
amounts due upon acceleration).

         In the event that,  notwithstanding the foregoing, any payment shall be
received by the Trustee or any  Debentureholder  when such payment is prohibited
by the preceding paragraphs of this Section 14.02, such payment shall be held in
trust for the benefit of, and shall be paid over or delivered to, the holders of
Senior Debt or their respective  representatives,  or to the trustee or trustees
under any  indenture  pursuant  to which any of such  Senior  Debt may have been
issued, as their respective interests may appear.

         SECTION 14.03. LIQUIDATION;  DISSOLUTION;  BANKRUPTCY. Upon any payment
by the  Company  or  distribution  of  assets  of the  Company  of any  kind  or
character,  whether in cash,  property  or  securities,  to  creditors  upon any
liquidation, dissolution, winding up, receivership,  reorganization,  assignment
for the  benefit  of  creditors,  marshaling  of assets and  liabilities  or any
bankruptcy, insolvency or similar proceedings of the Company, all amounts due or
to become due upon all Senior Debt shall first be paid in full,  in cash or cash
equivalents,  or payment  thereof  provided  for in  accordance  with its terms,
before any payment is made on account of the principal of,  premium,  if any, or
interest on the  indebtedness  evidenced  by the  Debentures,  and upon any such
liquidation, dissolution, winding up, receivership, reorganization,

                                       54





assignment,  marshaling or proceeding,  any payment or distribution of assets of
the Company of any kind or character,  whether in cash,  property or securities,
to which the  Debentureholders  or the  Trustee  under this  Indenture  would be
entitled,  except for the  provisions  of this  Article 14, shall be paid by the
Company or by any receiver, trustee in bankruptcy, liquidating trustee, agent or
other Person making such payment or distribution,  or by the Debentureholders or
by the Trustee under this  Indenture if received by them or it,  directly to the
holders of Senior Debt (pro rata to such holders on the basis of the  respective
amounts   of  Senior   Debt   held  by  such   holders)   or  their   respective
representatives,  or to the trustee or trustees under any indenture  pursuant to
which any  instruments  evidencing any of such Senior Debt may have been issued,
as their  respective  interests may appear,  to the extent  necessary to pay all
Senior Debt in full (including,  without  limitation,  except to the extent,  if
any, prohibited by mandatory provisions of law,  post-petition  interest, in any
such proceedings), after giving effect to any concurrent payment or distribution
to or for the holders of Senior Debt, before any payment or distribution is made
to the holders of the indebtedness evidenced by the Debentures or to the Trustee
under this Indenture.

         In the event  that,  notwithstanding  the  foregoing,  any  payment  or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities,  prohibited by the  foregoing,  shall be received by the
Trustee under this Indenture or the holders of the Debentures  before all Senior
Debt is paid in full or provision is made for such  payment in  accordance  with
its terms,  such payment or distribution  shall be held in trust for the benefit
of and shall be paid over or  delivered  to the  holders of such  Senior Debt or
their  respective  representatives,  or to the  trustee  or  trustees  under any
indenture  pursuant to which any instruments  evidencing any of such Senior Debt
may have been issued, as their respective  interests may appear, for application
to the payment of all Senior Debt  remaining  unpaid  until all such Senior Debt
shall have been paid in full in accordance  with its terms,  after giving effect
to any concurrent  payment or  distribution to or for the holders of such Senior
Debt.

         For  purposes  of  this  Article  14,  the  words  "cash,  property  or
securities"  shall not be deemed to  include  shares of stock of the  Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided  for by a plan of  arrangement,  reorganization  or  readjustment,  the
payment  of which is  subordinated  (at  least to the  extent  provided  in this
Article 14 with  respect to the  Debentures)  to the  payment of all Senior Debt
which may at the time be  outstanding;  provided,  that (i) the  Senior  Debt is
assumed by the new  corporation,  if any,  resulting from any such  arrangement,
reorganization or readjustment, and (ii) the rights of the holders of the Senior
Debt are not, without the consent of such holders,  altered by such arrangement,
reorganization  or readjustment.  The  consolidation of the Company with, or the
merger  of  the  Company  into,  another   corporation  or  the  liquidation  or
dissolution of the Company  following the conveyance or transfer of its property
as an entirety, or substantially as an entirety, to another corporation upon the
terms and  conditions  provided in Article 10 shall not be deemed a dissolution,
winding-up,  liquidation or  reorganization  for the purposes of this Section if
such other Person shall, as a part of such consolidation,  merger, conveyance or
transfer,  comply with the  conditions  stated in Article 10. Nothing in Section
14.02 or this  Section  14.03  shall  apply to claims  of, or  payments  to, the
Trustee under or pursuant to Article 7, except as provided therein. This Section
shall be subject to the further provisions of Section 14.06.

                                       55





         SECTION 14.04.  SUBROGATION  OF  DEBENTURES.  Subject to the payment in
full of all Senior Debt,  the rights of the holders of the  Debentures  shall be
subrogated  to the rights of the holders of Senior  Debt to receive  payments or
distributions of cash,  property or securities of the Company  applicable to the
Senior  Debt until the  principal  of,  premium,  if any,  and  interest  on the
Debentures shall be paid in full; and, for the purposes of such subrogation,  no
payments  or  distributions  to the  holders  of the  Senior  Debt of any  cash,
property or securities to which the holders of the  Debentures or the Trustee on
their behalf would be entitled  except for the provisions of this Article 14 and
no payment over pursuant to the  provisions of this Article 14 to the holders of
Senior Debt by holders of the  Debentures  or the Trustee on their behalf shall,
as between the Company,  its creditors other than holders of Senior Debt and the
holders of the  Debentures,  be deemed to be a payment  by the  Company to or on
account of the Senior Debt; and no payments or distributions  of cash,  property
or  securities  to or for the  benefit of the  Debentureholders  pursuant to the
subrogation  provisions of this Article, which would otherwise have been paid to
the  holders of Senior Debt shall be deemed to be a payment by the Company to or
for the account of the Debentures.  It is understood that the provisions of this
Article 14 are and are intended  solely for the purpose of defining the relative
rights of the holders of the Debentures, on the one hand, and the holders of the
Senior Debt, on the other hand.

         Nothing  contained in this Article 14 or elsewhere in this Indenture or
in the  Debentures is intended to or shall impair,  as between the Company,  its
creditors  other  than the  holders  of  Senior  Debt,  and the  holders  of the
Debentures,  the obligation of the Company, which is absolute and unconditional,
to pay to the holders of the Debentures the principal of,  premium,  if any, and
interest on the  Debentures as and when the same shall become due and payable in
accordance  with their  terms,  or is intended to or shall  affect the  relative
rights of the holders of the  Debentures and creditors of the Company other than
the holders of the Senior Debt, nor shall anything herein or therein prevent the
holder of any  Debenture  or the  Trustee  on his  behalf  from  exercising  all
remedies  otherwise   permitted  by  applicable  law  upon  default  under  this
Indenture,  subject to the rights,  if any, under this Article 14 of the holders
of Senior  Debt in  respect  of cash,  property  or  securities  of the  Company
received upon the exercise of any such remedy.

         Upon any payment or distribution  of assets of the Company  referred to
in this Article 14, the Trustee, subject to the provisions of Article 7, and the
holders of the  Debentures  shall be  entitled  to rely upon any order or decree
made  by  any  court  of  competent  jurisdiction  in  which  such  liquidation,
dissolution, winding up, receivership,  reorganization, assignment or marshaling
proceedings  are  pending,  or  a  certificate  of  the  receiver,   trustee  in
bankruptcy,  liquidating  trustee,  agent or other person making such payment or
distribution,  delivered to the Trustee or to the holders of the Debentures, for
the  purpose  of  ascertaining  the  persons  entitled  to  participate  in such
distribution,  the  holders of the  Senior  Debt and other  indebtedness  of the
Company,  the amount thereof or payable  thereon,  the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article 14.

         SECTION  14.05.  AUTHORIZATION  BY  DEBENTUREHOLDERS.  Each holder of a
Debenture by his  acceptance  thereof  authorizes and directs the Trustee in his
behalf to take such action as may be necessary or  appropriate to effectuate the
subordination provided in this Article 14 and appoints the Trustee his attorney-
in-fact for any and all such purposes.

                                       56





         SECTION 14.06. NOTICE TO TRUSTEE. The Company shall give prompt written
notice to the Trustee  and to any paying  agent of any fact known to the Company
which would prohibit the making of any payment of moneys to or by the Trustee or
any paying agent in respect of the Debentures pursuant to the provisions of this
Article 14. Regardless of anything to the contrary  contained in this Article 14
or elsewhere in this Indenture,  the Trustee shall not be charged with knowledge
of the  existence  of any Senior Debt or of any default or event of default with
respect to any Senior Debt or of any other facts which would prohibit the making
of any  payment of moneys to or by the  Trustee,  unless  and until the  Trustee
shall have received notice in writing at its principal Corporate Trust Office to
that effect  signed by an officer of the  Company,  or by a holder or agent of a
holder of Senior Debt who shall have been  certified by the Company or otherwise
established to the reasonable  satisfaction  of the Trustee to be such holder or
agent, or by the trustee under any indenture pursuant to which Senior Debt shall
be  outstanding,  and,  prior to the  receipt of any such  written  notice,  the
Trustee  shall,  subject to the  provisions  of Article 7, be entitled to assume
that no such facts exist;  provided,  however,  that if on a date at least three
Business  Days prior to the date upon which by the terms  hereof any such moneys
shall become payable for any purpose (including, without limitation, the payment
of the  principal of, or interest on any  Debenture)  the Trustee shall not have
received  with  respect to such moneys the notice  provided  for in this Section
14.06,  then,  regardless of anything herein to the contrary,  the Trustee shall
have full power and  authority  to receive  such moneys 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 on or after such prior date.

         The Trustee shall be entitled to  conclusively  rely on the delivery to
it of a written notice by a Person representing himself to be a holder of Senior
Debt (or a trustee on behalf of such holder) to  establish  that such notice has
been given by a holder of Senior Debt or a trustee on behalf of any such holder.
In the event that the Trustee  determines in good faith that further evidence is
required  with  respect to the right of any Person as a holder of Senior Debt to
participate  in any payment or  distribution  pursuant  to this  Article 14, the
Trustee  may  request  such  Person  to  furnish   evidence  to  the  reasonable
satisfaction of the Trustee as to the amount of Senior Debt held by such Person,
the extent to which such Person is entitled to  participate  in such  payment or
distribution  and any other facts  pertinent  to the rights of such Person under
this Article 14, and if such evidence is not furnished the Trustee may defer any
payment to such Person pending  judicial  determination  as to the right of such
Person to receive such payment.

         SECTION 14.07.  TRUSTEE'S  RELATION TO SENIOR DEBT. The Trustee and any
agent of the  Company or the  Trustee  shall be  entitled  to all the rights set
forth in this  Article 14 with  respect to any Senior Debt which may at any time
be held by it in its  individual or any other capacity to the same extent as any
other  holder of Senior Debt and  nothing in this  Indenture  shall  deprive the
Trustee or any such agent, of any of its rights as such holder.  Nothing in this
Article  shall apply to claims of, or payments to, the Trustee under or pursuant
to Article 7.

         With respect to the holders of Senior Debt,  the Trustee  undertakes to
perform  or to  observe  only  such  of its  covenants  and  obligations  as are
specifically  set  forth  in  this  Article  14,  and no  implied  covenants  or
obligations  with  respect to the holders of Senior Debt shall be read into this
Indenture  against  the  Trustee.  The  Trustee  shall  not be deemed to owe any
fiduciary

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>



duty to the holders of Senior Debt and,  subject to the provisions of Article 7,
the  Trustee  shall not be liable to any  holder of Senior  Debt if it shall pay
over or deliver to holders of Debentures, the Company or any other person moneys
or assets to which any holder of Senior Debt shall be entitled by virtue of this
Article 14 or otherwise.

         Nothing in this  Article 14 shall apply to claims of, or  payments  to,
the Trustee under or pursuant to Section 7.06.

         SECTION 14.08. NO IMPAIRMENT TO SUBORDINATION.  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 the  Company or by any act or failure to act,  in good faith,
by any such  holder,  or by any  noncompliance  by the  Company  with the terms,
provisions and covenants of this Indenture,  regardless of any knowledge thereof
which any such holder may have or otherwise be charged with.

         Without in any way limiting the generality of the foregoing  paragraph,
the  holders of Senior  Debt of the  Company  may,  at any time and from time to
time,  without the consent of or notice to the Trustee or the  Debentureholders,
without incurring  responsibility to the  Debentureholders and without impairing
or releasing the  subordination  provided in this Article 14 or the  obligations
hereunder of the holders of the  Debentures  to the holders of such 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,  such Senior  Debt,
or  otherwise  amend  or  supplement  in any  manner  such  Senior  Debt  or any
instrument  evidencing the same or any agreement under which such Senior Debt is
outstanding;  (ii) sell,  exchange,  release or otherwise deal with any property
pledged,  mortgaged or otherwise  securing  such Senior Debt;  (iii) release any
Person  liable in any manner for the  collection  of such Senior Debt;  and (iv)
exercise or refrain from exercising any rights against the Company,  as the case
may be, and any other Person.

         SECTION 14.09. ARTICLE APPLICABLE TO PAYING AGENTS. In case at any time
any paying agent other than the Trustee shall have been appointed by the Company
and be then acting  hereunder,  the term "Trustee" as used in this Article shall
in such case (unless the context  otherwise  requires) be construed as extending
to and  including  such paying agent within its meaning as fully for all intents
and  purposes as if such paying  agent were named in this Article in addition to
or in place of the Trustee.

         SECTION 14.10. TRUST MONEYS NOT SUBORDINATED.  Notwithstanding anything
contained  herein to the  contrary,  payments from money or the proceeds of U.S.
Government  Obligations  held in trust under Section 11.02 of this  Indenture by
the Trustee for the payment of principal of and interest on the Debentures shall
not be  subordinated  to the prior  payment of any Senior Debt or subject to the
restrictions  set forth in this  Article  14,  and none of the  Debentureholders
shall be  obligated  to pay over any such amount to the Company or any holder of
Senior Debt of the Company or any other creditor of the Company.


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         The Bank of New  York,  a New York  banking  corporation,  as  Trustee,
hereby accepts the trust in this Indenture declared and provided, upon the terms
and conditions herein above set forth.



                                       59





         IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed as of the day and year first above written.

                              LITCHFIELD FINANCIAL CORPORATION

                              /s/ Ronald E. Rabidou
                        By:   ______________________________
                              Ronald E. Rabidou
                              Executive Vice President and Chief
                              Financial Officer


                              THE BANK OF NEW YORK, as TRUSTEE


                        By:   /s/ Michael Culhane
                              ------------------------------
                              Michael Culhane
                              Vice President

STATE OF Massachusetts
COUNTY OF Berkshire

         BEFORE  ME, the  undersigned  authority,  on this day of May 19,  1999,
personally   appeared   Ronald   Rabidou  on  behalf  of  Litchfield   Financial
Corporation,  known to me (or  proved to me by  introduction  upon the oath of a
person known to me) to be the person and officer whose name is subscribed to the
foregoing instrument, and acknowledged to me that he or she executed the same as
the  act of such  corporation  and for the  purposes  and  consideration  herein
expressed and in the capacity therein stated.

         GIVEN UNDER MY HAND AND SEAL THIS 19th day of May, 1999.

                              /s/ Losha M. Daub
                              ------------------------------
                              Notary Public
                              My Commission Expires: April 21, 2000

STATE OF
COUNTY OF

         BEFORE  ME, the  undersigned  authority,  on this day of May 19,  1999,
personally  appeared Michael Culhane of The Bank of New York, a New York banking
corporation,  known to me (or  proved to me by  introduction  upon the oath of a
person known to me) to be the person and officer whose name is subscribed to the
foregoing instrument, and acknowledged to me that

                                       60




he or she  executed  the  same as the act of such  trust  for the  purposes  and
consideration herein expressed and in the capacity therein stated.
         GIVEN UNDER MY HAND AND SEAL THIS 19th day of May, 1999.


                                   /s/ William J. Cassels
                                   ------------------------------
                                   Notary Public
                                   My Commission Expires: May 16, 2000



HWD2:  551485-1

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