Exhibit B-4(b)



            MISSISSIPPI BUSINESS FINANCE CORPORATION


                              and


               THE BANK OF NEW YORK TRUST COMPANY
                  OF FLORIDA, N.A., as Trustee






                        TRUST INDENTURE






                  Dated as of October 15, 1998





           Relating to $216,000,000 Pollution Control
                    Revenue Refunding Bonds
            (System Energy Resources, Inc. Project)
                          Series 1998




<PAGE>


     THIS INDENTURE made and entered into as of October 15, 1998,
by  and  between the MISSISSIPPI BUSINESS FINANCE CORPORATION,  a
public corporation duly created and validly existing pursuant  to
the  Constitution  and  laws  of the State  of  Mississippi  (the
"Issuer"), authorized to exercise the powers conferred by the Act
(as  hereinafter defined), and THE BANK OF NEW YORK TRUST COMPANY
OF  FLORIDA, N.A., Jacksonville, Florida, a bank duly  organized,
existing  and  authorized to accept and  execute  trusts  of  the
character herein set out under and by virtue of the laws  of  the
United States of America, as Trustee (the "Trustee").

                            RECITALS

     WHEREAS,  the  Issuer  is authorized by  the  provisions  of
Sections 57-10-201 et seq., Mississippi Code of 1972, as  amended
and  supplemented  (the "Act"), among other  things,  to  provide
financial assistance to businesses in the State of Mississippi by
providing  loans, guarantees, insurance and other  assistance  to
businesses, thereby encouraging the investment of private capital
in  businesses in the State of Mississippi, and to  finance  such
assistance to businesses by the issuance of revenue bonds; and

     WHEREAS, pursuant to its statutory powers, Claiborne County,
Mississippi  (the "County") has entered into an Installment  Sale
Agreement,  dated  as of December 1, 1983,   with  System  Energy
Resources,   Inc.,  formerly  Middle  South   Energy,   Inc.,   a
corporation organized and existing under the laws of the State of
Arkansas and qualified to do business as a foreign corporation in
the  State of Mississippi (the "Company"), pursuant to which  the
County  issued  and  sold  its  Adjustable/Fixed  Rate  Pollution
Control   Revenue  Bonds  (Middle  South  Energy,  Inc.  Project)
Series  A, dated December 1, 1983 (the "Series A Bonds")  in  the
aggregate  principal amount of $49,500,000 in order, inter  alia,
to  finance  the cost of acquiring an undivided 90%  interest  in
certain air and water pollution control facilities and sewage and
solid  waste  disposal facilities  (the "Project") at  the  Grand
Gulf Nuclear Electric Generating Station (the "Plant") located in
the County; and

     WHEREAS,  pursuant to its statutory powers, the  County  has
entered  into  an  Installment  Sale  Agreement,  dated   as   of
December 1, 1984  with the Company, pursuant to which the  County
issued  and  sold  its  Adjustable/Fixed Rate  Pollution  Control
Revenue Bonds (Middle South Energy, Inc. Project) Series C, dated
December  1,  1984  (the  "Series  C  Bonds")  in  the  aggregate
principal amount of $206,000,000 in order, inter alia, to finance
the cost of acquiring the Project at the Plant; and

     WHEREAS, the Issuer and the Company have entered into a Loan
Agreement,  dated  as  of  October 15,  1998  (the  "Agreement"),
providing  that, for the purposes therein set forth,  the  Issuer
will issue and sell its Bonds (as hereinafter defined) in one  or
more  series; that the Issuer will loan the proceeds of the Bonds
to  the  Company;  and that to evidence the Loan (as  hereinafter
defined) the Company will execute and deliver, concurrently  with
the issuance of each series of Bonds, a non-negotiable promissory
note  in  a  like principal amount bearing interest at  the  same
stated rate or rates of interest as such series of Bonds; and

     WHEREAS,  the  execution and delivery of this Indenture  and
the  Agreement  have  been  in  all  respects  duly  and  validly
authorized by a resolution duly adopted by the Board of Directors
of the Issuer (the "Board"); and

     WHEREAS,  in  order to provide funds to currently  refund  a
portion of the Series A Bonds and all of the Series C Bonds,  the
Issuer has duly authorized the issuance and sale of its Pollution
Control  Revenue  Refunding Bonds (System Energy Resources,  Inc.
Project)  Series 1998 (hereinafter sometimes called  the  "Series
1998  Bonds"), in the aggregate principal amount of $216,000,000;
and

     WHEREAS,  the  Issuer has determined that  the  Series  1998
Bonds  and  the certificate of authentication by the Trustee  and
the certificate of registration and validation to be endorsed  on
all  the  Series 1998 Bonds shall be, respectively, substantially
in  the  following  forms,  with such variations,  omissions  and
insertions as are required or permitted by this Indenture:

                         [FORM OF BOND]

                [ADD DTC LEGEND, IF APPLICABLE]

No.                                     $

Dated Date: October 15, 1998       CUSIP:

                    UNITED STATES OF AMERICA
                      STATE OF MISSISSIPPI
            MISSISSIPPI BUSINESS FINANCE CORPORATION
            POLLUTION CONTROL REVENUE REFUNDING BOND
            (System Energy Resources, Inc. Project)
                          Series 1998

     MISSISSIPPI BUSINESS FINANCE CORPORATION (herein called  the
"Issuer"), a public corporation duly created and validly existing
pursuant   to  the  Constitution  and  laws  of  the   State   of
Mississippi, for value received, hereby promises to  pay,  solely
from the special fund provided therefor as hereinafter set forth,
to  Cede & Co. or registered assigns or legal representative,  on
the  1st  day of April, 2022 (or earlier as hereinafter  referred
to),  upon the presentation and surrender hereof at the principal
corporate  trust  office of the Trustee (hereinafter  mentioned),
the                principal                sum                of

                                                          Dollars
($                                  ) in any coin or currency  of
the United States of America which on the date of payment thereof
is  legal tender for the payment of public and private debts, and
to  pay,  solely from said special fund, to the registered  owner
hereof  by check or draft mailed to the registered owner  at  his
address  as  it  appears on the bond registration  books  of  the
Issuer, interest on said principal sum from the latest semiannual
interest payment date to which interest has been paid on Bonds of
this series preceding the date hereof, unless the date hereof  is
an  interest  payment date to which interest is  being  paid,  in
which  case  from the date hereof, or unless the date  hereof  is
prior  to April 1, 1999, in which case from October 15, 1998,  at
the  rate  of five and seven-eighths percent (5.875%)  per  annum
until  payment of said principal sum, such interest being payable
semiannually  on  the  1st days of April and October  (commencing
April 1, 1999) in each year in like coin or currency.

     The  interest  payable on any April 1  or  October  1  will,
subject   to   certain  exceptions  provided  in  the   Indenture
(hereinafter mentioned), be paid to the person in whose name this
Bond  is registered at the close of business on the record  date,
which shall be the March 15 or September 15, as the case may  be,
next preceding such interest payment date or, if such March 15 or
September  15 shall be a legal holiday or a day on which  banking
institutions in Jacksonville, Florida, are authorized  to  close,
the  next preceding day which shall not be a legal holiday  or  a
day on which such institutions are so authorized to close.

     The  Issuer is a public corporation duly created and validly
existing  pursuant to the Constitution and laws of the  State  of
Mississippi.  The Bonds (hereinafter mentioned) are authorized to
be  issued  for  purposes for which bonds are  authorized  to  be
issued  under  the  provisions  of Sections  57-10-201  et  seq.,
Mississippi  Code  of  1972,  as amended  and  supplemented  (the
"Act").  This Bond and the interest hereon shall not be deemed to
constitute a debt, liability or obligation of the Issuer  or  the
State of Mississippi or any political subdivision thereof,  or  a
pledge  of  the faith and credit of the Issuer or  the  State  of
Mississippi or any political subdivision thereof, but  this  Bond
shall  be  payable solely from the revenues provided therefor  as
hereinafter described and the Issuer is not obligated to pay this
Bond or the interest hereon except from the revenues and proceeds
pledged therefor and neither the faith and credit nor the  taxing
power  of the Issuer or the State of Mississippi or any political
subdivision thereof is pledged to the payment of the principal of
or  the redemption premium, if any, or interest on this Bond.  No
covenant  or agreement contained in this Bond shall be deemed  to
be  a  covenant  or  agreement of any member, officer,  agent  or
employee  of the Issuer in his individual capacity and no  member
of  the  Board of Directors of the Issuer nor any officer of  the
Issuer  executing  this Bond shall be liable personally  on  this
Bond  or be subject to any personal liability in connection  with
the issuance of this Bond.

     This  Bond  is  one of a duly authorized series  of  revenue
refunding bonds of the Issuer known as "Pollution Control Revenue
Refunding  Bonds  (System Energy Resources, Inc. Project)  Series
1998", issued for the purpose of currently refunding a portion of
$49,500,000  Claiborne County, Mississippi Adjustable/Fixed  Rate
Pollution  Control  Revenue  Bonds  (Middle  South  Energy,  Inc.
Project)  Series  A  and  all of $206,000,000  Claiborne  County,
Mississippi Adjustable/Fixed Rate Pollution Control Revenue Bonds
(Middle South Energy, Inc. Project) Series C, issued in order  to
finance  the  cost  of  acquiring an undivided  90%  interest  in
certain air and water pollution control facilities and sewage and
solid  waste  disposal  facilities  at  the  Grand  Gulf  Nuclear
Electric   Generating  Station  located  in   Claiborne   County,
Mississippi.   The  Bonds  of  this series  initially  authorized
aggregate  Two  Hundred  Sixteen Million  and  No/100ths  Dollars
($216,000,000) in principal amount.  The Indenture  provides  for
the  issuance, under the conditions, limitations and restrictions
therein  set  forth,  of  additional Bonds  for  the  purpose  of
refunding Bonds of any series issued under the Indenture.

     The  Bonds  of  this  series and all such  additional  Bonds
(herein called collectively the "Bonds") are issued or are to  be
issued  under  and  pursuant  to a trust  indenture  (said  trust
indenture,   together  with  all  trust  indentures  supplemental
thereto   as   therein  permitted,  being   herein   called   the
"Indenture"), dated as of the l5th day of October, 1998,  by  and
between  the  Issuer and The Bank of New York  Trust  Company  of
Florida,  N.A.,  as Trustee (said bank and any successor  trustee
under  the  Indenture  being  herein called  the  "Trustee"),  an
executed  counterpart  of  which Indenture  is  on  file  at  the
principal office of the Trustee.  Reference is hereby made to the
Indenture for the provisions, among others, with respect  to  the
custody and application of the proceeds of Bonds issued under the
Indenture,   the  collection  and  disposition  of  revenues,   a
description of the funds charged with and pledged to the  payment
of  the principal of and redemption premium, if any, and interest
on  the  Bonds, the nature and extent of the security, the  terms
and  conditions under which the Bonds are or may be  issued,  the
rights,  duties and obligations of the Issuer and of the Trustee,
the  rights  of  the  holders of the  Bonds  and  the  terms  and
conditions  pursuant  to which the Indenture  and  the  Agreement
(hereinafter mentioned) may be amended, and, by the acceptance of
this Bond, the holder hereof assents to all of the provisions  of
the Indenture.

     This  Bond is issued and the Indenture was made and  entered
into under and pursuant to the Constitution and laws of the State
of  Mississippi, and particularly the Act, and under and pursuant
to resolutions duly adopted by the Issuer.

     The  Issuer has entered into a Loan Agreement, dated  as  of
October  15,  1998 (herein called the "Agreement"),  with  System
Energy  Resources,  Inc., a corporation  organized  and  existing
under  the  laws  of the State of Arkansas and  qualified  to  do
business  as  a  foreign corporation in the State of  Mississippi
(herein called the "Company"), under the provisions of which  the
Issuer has loaned the proceeds of the Bonds of this series to the
Company  and  has agreed to loan the proceeds of  any  additional
series  of  Bonds to the Company (herein called the "Loan").   In
order   to   evidence  the  Loan  and  the  Company's   repayment
obligation,  the  Company has executed  and  delivered  its  non-
negotiable  promissory note and has agreed  to  issue  additional
such  notes  concurrently  with the issuance  of  any  additional
series  of Bonds (herein called the "Notes").  The Notes  provide
for  the repayment by the Company of the Loan, including interest
thereon, in installments sufficient to pay the principal  of  and
redemption premium, if any, and interest on the Bonds as the same
shall become due and payable.  The Notes provide that the amounts
so to be paid thereunder shall be paid directly to the Trustee as
assignee of the Issuer; such payments are to be deposited to  the
credit  of  the  Bond Fund as defined in and  created  under  the
Indenture which special fund is pledged to and charged  with  the
payment  of the principal of and redemption premium, if any,  and
interest on all Bonds issued under the Indenture and such amounts
so  to be paid thereunder have been duly pledged and assigned for
that  purpose.  In addition, certain other rights of  the  Issuer
under  the Agreement have been assigned to the Trustee to  secure
payment  of  such  principal, redemption  premium,  if  any,  and
interest under the Indenture.

     The  Bonds  are  issuable as fully registered Bonds  without
coupons  in  denominations  of $5,000 or  any  integral  multiple
thereof.  At the principal corporate trust office of the Trustee,
in  the  manner  and subject to the limitations,  conditions  and
charges provided in the Indenture, Bonds may be exchanged for  an
equal  aggregate principal amount of Bonds of the same  maturity,
of  authorized  denominations and bearing interest  at  the  same
rate.

     The  Bonds of this series are subject to optional redemption
by  the  Issuer, at the written direction of the Company pursuant
to  Section 4.9 of the Agreement, prior to maturity on  or  after
October 1, 2003, in whole or in part at any time (but if in  part
by  lot  or  in  such other random manner as the Trustee  in  its
discretion may determine), at the redemption prices (expressed as
percentages  of principal amount) set forth in the  table  below,
plus accrued interest to the redemption date:

                                              Optional
        Redemption Period                    Redemption
      (all dates inclusive)                    Price

     October 1, 2003 through September 30, 2004  102%
     October 1, 2004 through September 30, 2005  101
     October 1, 2005 and thereafter              100

     The  Bonds  of  this  series are  also  subject  to  special
optional  redemption by the Issuer in the event the  Trustee  and
the Issuer shall have received written notice from the Company of
its  determination of the occurrence of certain events  specified
in Section 3.02 of the Indenture.  If called for special optional
redemption  in  such  event, the Bonds of this  series  shall  be
subject to redemption at any time, in whole but not in part, at a
redemption  price  equal  to the principal  amount  thereof  plus
accrued  interest  to the redemption date but without  redemption
premium.

     The  Bonds  of this series will also be subject to  optional
redemption by the Issuer, at the written direction of the Company
pursuant  to Section 4.9 of the Agreement, in whole  but  not  in
part, at any time prior to October 1, 2003, at a redemption price
equal to 102% of the principal amount being redeemed plus accrued
interest  to  the  redemption date, if  the  Company  shall  have
consolidated with or merged with or into another corporation,  or
sold  or  otherwise transferred all or substantially all  of  its
assets.

     The  Bonds  of  this  series are also subject  to  mandatory
redemption,  at a redemption price equal to the principal  amount
being  redeemed plus accrued interest to the redemption date,  on
the  180th day (or such earlier date as may be designated by  the
Company)  after  a  final determination by a court  of  competent
jurisdiction or an administrative agency to the effect that, as a
result  of  a  failure  by the Company to observe  any  covenant,
agreement  or  representation contained in the Agreement  or  the
Issuer  to  observe any covenant, agreement or representation  in
the  Indenture,  the  interest  payable  on  such  Bonds  is  not
excludable for federal income tax purposes from the gross  income
of the owners thereof (other than any owner who is a "substantial
user" of the Project or a "related person" within the meaning  of
Section  103(b)(13) of the Internal Revenue  Code  of  1954  (the
"1954  Code").   No determination by any court or  administrative
agency  will be considered final unless the Company has  received
timely notice of and has had an opportunity to participate in the
proceeding  which resulted in such determination.  The  Bonds  of
this series will be redeemed, either in whole or in part, in such
principal  amount  that  the  interest  payable  on  such   Bonds
remaining  outstanding  after such  redemption  would  not  under
Section  103 of the 1954 Code be included in the gross income  of
any  owner  thereof  (other than an owner who is  a  "substantial
user" of the Project or a "related person" within the meaning  of
Section 103(b)(13) of the 1954 Code).

     Any  such  redemption, either in whole or in part, shall  be
made  upon  not  less than twenty-five (25) days' nor  more  than
sixty  (60) days' prior notice as provided in the Indenture,  and
shall  be  made in the manner and under the terms and  conditions
provided   in   the  Indenture.   On  the  date  designated   for
redemption,  notice having been given and moneys for  payment  of
the  redemption  price and accrued interest  being  held  by  the
Trustee  or  by  the  paying  agents,  all  as  provided  in  the
Indenture,  the  Bonds  or  portions  of  Bonds  so  called   for
redemption  shall become and be due and payable at the redemption
price  provided  for redemption of such Bonds  or  such  portions
thereof  on  such date, interest on such Bonds or  such  portions
thereof  so  called for redemption shall cease  to  accrue,  such
Bonds  or  such  portions thereof so called for redemption  shall
cease  to  be  entitled  to any benefit  or  security  under  the
Indenture, and the registered owners thereof shall have no rights
in  respect of such Bonds or such portions thereof so called  for
redemption except to receive payment of the redemption price  and
accrued interest thereon so held by the Trustee or by the  paying
agents.   If  a  portion  of  this  Bond  shall  be  called   for
redemption,  a new registered Bond without coupons  in  principal
amount  equal to the unredeemed portion hereof will be issued  to
the registered owner upon the surrender hereof.

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

     In certain events, on the conditions, in the manner and with
the  effect set forth in the Indenture, the principal of all  the
Bonds  then Outstanding under the Indenture may become or may  be
declared  due  and  payable before the stated  maturity  thereof,
together with the interest accrued thereon.

     Modifications or alterations of the Indenture or  any  trust
indenture  supplemental thereto or of the Agreement may  be  made
only  to  the  extent and in the circumstances permitted  by  the
Indenture.

     The   transfer  of  this  Bond  may  be  registered  by  the
registered  owner  hereof in person or by his attorney  or  legal
representative  at the principal corporate trust  office  of  the
Trustee,  but  only in the manner and subject to the  limitations
and  conditions provided in the Indenture and upon surrender  and
cancellation of this Bond.  Upon any such registration  of  trans
fer  the  Issuer shall execute and the Trustee shall authenticate
and  deliver in exchange for this Bond a new registered  Bond  or
Bonds  without coupons, registered in the name of the transferee,
of  authorized denominations, in aggregate principal amount equal
to  the  principal amount of this Bond, of the  same  series  and
maturity and bearing interest at the same rate.

     This  Bond  is issued with the intent that the laws  of  the
State  of Mississippi shall govern its construction.  As declared
by the Act and other applicable laws of the State of Mississippi,
this  Bond  shall have all the qualities and incidents, including
negotiability,  of  an  investment  security  under  the  Uniform
Commercial Code of the State of Mississippi.

     All  acts,  conditions and things required to happen,  exist
and  be  performed precedent to and in the issuance of this  Bond
and  the execution of the Indenture have happened, exist and have
been performed as so required.

     This  Bond shall not be valid or become obligatory  for  any
purpose  or  be  entitled to any benefit or  security  under  the
Indenture until it shall have been authenticated by the execution
by  the  Trustee  of  the certificate of authentication  endorsed
hereon.

     IN    WITNESS   WHEREOF,   Mississippi   Business    Finance
Corporation, by resolution of its Board of Directors, has  caused
this  Bond  to be executed in its name and on its behalf  by  the
facsimile signature of its Executive Director, and by the  manual
or  facsimile signature of its Secretary and a facsimile  of  its
seal to be imprinted hereon.


                                   MISSISSIPPI BUSINESS FINANCE
                                   CORPORATION
(SEAL)
                                   By
                                      Executive Director
Attest:

                         
Secretary


        [FORM OF TRUSTEES CERTIFICATE OF AUTHENTICATION]

                 (To be endorsed on all Bonds)

                 CERTIFICATE OF AUTHENTICATION

     This  Bond  is  one  of the Bonds of the  series  designated
therein  and issued under the provisions of the within  mentioned
Indenture.

Dated:                         THE BANK OF NEW YORK TRUST COMPANY
                                   OF FLORIDA, N.A.,
                                   as Trustee

                                   By
                                      Authorized Signature

<PAGE>
       [FORM OF REGISTRATION AND VALIDATION CERTIFICATE]

                 (To be endorsed on all Bonds)


STATE OF MISSISSIPPI

COUNTY OF HINDS

     The  undersigned,  Secretary  of  the  Mississippi  Business
Finance Corporation, does hereby certify that the within Bond has
been  duly registered by me pursuant to law in a book kept in  my
office  for  that  purpose; and that the  within  Bond  has  been
validated  by decree of the Chancery Court of the First  Judicial
District of Hinds County, Mississippi, rendered on the 2nd day of
November, 1998.

                                   
                                   Secretary  of the  Mississippi
                                   Business Finance Corporation

                           ASSIGNMENT

                       FOR VALUE RECEIVED

     The  undersigned  hereby sells, assigns and  transfers  unto
(Please insert name, address and Social Security Number or  other
identifying number of Assignee)





the  within  Bond of the MISSISSIPPI BUSINESS FINANCE CORPORATION
and       does      hereby      constitute      and       appoint

                     as attorney to transfer the said Bond on the
books of the within named Issuer, with full power of substitution
in the premises.

Dated:

<PAGE>

Signature guaranteed

                                     
                                   Registered Owner
Insert  Social Security Number      
or  Other  Tax  Identification     Notice:  Signature(s) to  this
Number of Assignor:                assignment   must   correspond
                                   with   the  name(s)   of   the
                                   Registered  Owner(s)   as   it
                                   appears  on  the face  of  the
                                   within    Bond    in     every
                                   particular, without alteration
                                   or  enlargement or any  change
                                   whatever    and    must     be
                                   guaranteed by a member firm of
                                   the New York Stock Exchange or
                                   a  commercial  bank  or  trust
                                   company who is a member  of  a
                                   Medallion  Signature Guarantee
                                   Program.
                                     
                     [END OF FORM OF BOND]

     WHEREAS,  all  acts, conditions and things required  by  the
Constitution  and  laws  of the State of Mississippi  to  happen,
exist  and be performed precedent to and in connection  with  the
execution  and delivery of this Indenture and the Agreement  have
happened, exist and have been performed as so required, in  order
to  make  this Indenture a valid and binding trust indenture  for
the  security  of the Bonds in accordance with its terms  and  in
order  to  make  the Agreement a valid and binding  agreement  in
accordance with its terms; and

     WHEREAS, the Trustee has accepted the trusts created by this
Indenture  and  in evidence thereof has joined in  the  execution
hereof.

     NOW,   THEREFORE,   THIS  INDENTURE  WITNESSETH,   that   in
consideration of the premises, of the acceptance by  the  Trustee
of  the trusts hereby created, and the purchase and acceptance of
the   Bonds  by  the  holders  thereof,  and  also  for  and   in
consideration of the sum of One Dollar ($1.00) to the  Issuer  in
hand  paid by the Trustee at or before the execution and delivery
of  this  Indenture, the receipt of which is hereby acknowledged,
and  for  the  purpose  of  fixing and declaring  the  terms  and
conditions  upon which the Bonds are to be issued, authenticated,
delivered,  secured and accepted by all persons  who  shall  from
time to time be or become holders thereof, and in order to secure
the  payment  of  all  Bonds at any time issued  and  outstanding
hereunder  and the interest and the redemption premium,  if  any,
thereon  according  to their tenor, purport and  effect,  and  in
order  to  secure  the  performance and  observance  of  all  the
covenants, agreements and conditions therein or herein contained;
the  Issuer has executed and delivered this Indenture, will cause
the  Company  to deliver to the Trustee the Company's  promissory
note  dated  the date of the initial issuance of the Series  1998
Bonds,  and  will cause the Company to deliver any other  of  its
Notes  (as defined in the Agreement) required in connection  with
the  issuance  of Additional Bonds (as hereinafter defined);  the
Issuer  does hereby bargain, sell, convey, assign and  pledge  to
the Trustee, and grant to the Trustee a security interest in, all
rights,  title and interests of the Issuer in, to and under  such
Notes  and  all payments made and to be made thereunder  and  all
security for the payment of all outstanding Series 1998 Bonds and
any Additional Bonds and the interest and the redemption premium,
if any, thereon and does hereby bargain, sell, convey, assign and
pledge  to  the  Trustee,  and grant to the  Trustee  a  security
interest in, all other rights, title and interests of the  Issuer
in,  to  and  under  the  Agreement  and  all  moneys  receivable
thereunder (except for payments to be received under Sections 4.3
and  5.3  of  the Agreement) as security for the payment  of  the
Bonds  as  aforesaid and the satisfaction of any other obligation
assumed  by  it in connection with all outstanding Bonds  at  any
time issued hereunder;

     TO  HAVE  AND  TO  HOLD the same unto the  Trustee  and  its
successors in trust forever;

     IN  TRUST NEVERTHELESS, upon the terms and trusts herein set
forth,  for  the equal and proportionate benefit and security  of
all  and singular present and future holders of the Bonds  issued
and  to  be  issued  under  this Indenture,  without  preference,
priority  or  distinction  as to lien  or  otherwise,  except  as
otherwise  hereinafter provided, of any one Bond over  any  other
Bond,  by  reason of priority in the issue, sale  or  negotiation
thereof or otherwise;

     PROVIDED,  HOWEVER, that if the Issuer,  its  successors  or
assigns  shall  pay  or  cause  to  be  paid  the  principal  of,
redemption premium, if any, and interest on the Bonds due  or  to
become  due thereon, at the times and in the manner mentioned  in
the  Bonds, and shall cause the payments to be made into the Bond
Fund  (as hereinafter defined) as required under Article V hereof
or  shall  provide, as permitted hereby, for the payment  thereof
pursuant  to  the  provisions of Article VII  hereof,  and  shall
perform  all the covenants and conditions required of it by  this
Indenture,  and shall pay or cause to be paid to the Issuer,  the
Trustee and any additional paying agents all sums of money due or
to become due to them in accordance with the terms and provisions
hereof,  then  upon such final payments, except  as  provided  in
Article VII hereof,  this Indenture and the rights hereby granted
shall terminate and the Trustee shall release this Indenture  and
shall  execute  such documents to evidence such  termination  and
release  as  may  be  reasonably required by the  Issuer  or  the
Company; otherwise this Indenture to be and remain in full  force
and effect.

     THIS  INDENTURE  FURTHER WITNESSETH,  and  it  is  expressly
declared,  that  all Bonds from time to time issued  and  secured
hereunder are to be issued, authenticated and delivered, and  all
said   property,   rights  and  interests,   including,   without
limitation, the amounts hereby assigned and pledged,  are  to  be
dealt  with  and  disposed  of  subject  to  the  terms  of  this
Indenture,  and the Issuer agrees with the Trustee and  with  the
respective holders and owners, from time to time, of said  Bonds,
or part thereof, as follows:

                           ARTICLE I

                          DEFINITIONS

     SECTION  1.01.  Definitions.  The terms "Act",  "Agreement",
"Board",   "Company",  "County",  "Issuer",  "Plant",  "Project",
"Series  A  Bonds"  and  "Series C Bonds"  shall  have  the  same
meanings given and assigned to such words in the Recitals hereto.

     The terms "Loan", "Notes" and "Series 1998 Bonds" defined in
Article  I of the Agreement shall have the same meanings in  this
Indenture.   In  addition, the following words and phrases  shall
have the following meanings:

Additional Bonds

     "Additional Bonds" means the bonds authorized to  be  issued
under Section 2.10 of this Indenture.

Bond Fund

     "Bond Fund" means the trust fund created by Section 5.02  of
this Indenture.

Bondholder

     "Bondholder" or "holder" or "owner of the Bonds"  means  the
person or entity in whose name any Bond is registered.

Bonds

     "Bonds" means the Series 1998 Bonds authorized to be  issued
under Section 2.02 of this Indenture and any Additional Bonds.

Code

     "Code" means the Internal Revenue Code of 1986, as amended.

Event of Default

     "Event  of  Default" means any occurrence or event described
in Section 8.01 hereof.

Government Obligations

     "Government Obligations" means (a) direct obligations of the
United States of America for the timely payment of which the full
faith  and credit of the United States of America is pledged,  or
(b)  obligations issued by a person controlled or  supervised  by
and acting as an instrumentality of the United States of America,
the  timely payment of the principal of and premium, if any,  and
interest  on which is fully and unconditionally guaranteed  as  a
full faith and credit obligation by the United States of America.

Indenture

     "Indenture"  means  this trust indenture and  any  indenture
supplemental hereto.

1954 Code

     "1954  Code"  means the Internal Revenue Code  of  1954,  as
amended.

Outstanding

     "Outstanding"   or  "Bonds  Outstanding"  or   "Bonds   then
Outstanding"  means all Bonds which have been  authenticated  and
delivered by the Trustee under this Indenture, except:

     (a)  Bonds cancelled after purchase or because of payment at
or redemption prior to maturity;

     (b)   Bonds  for  the  payment or redemption  of  which  all
necessary  moneys  or  Government  Obligations  shall  have  been
theretofore deposited with the Trustee (whether upon or prior  to
the maturity or redemption date of any such Bonds);

     provided that, if such Bonds are to be redeemed prior to the
maturity thereof, notice of such redemption shall have been given
or  arrangements satisfactory to the Trustee shall have been made
therefor, pursuant to the terms hereof, or waiver of such  notice
satisfactory  in form to the Trustee shall have been  filed  with
the Trustee;

     (c)   Bonds  in exchange for which, or upon the transfer  of
which,  other  Bonds have been authenticated under  Section  2.05
hereof; and

     (d)    Bonds  in  lieu  of  which  other  Bonds  have   been
authenticated under Sections 2.07 and 2.08 hereof.

Rebate Agreement

     "Rebate Agreement" has the meaning set forth in Section 5.09
hereof.

Securities Depository

     "Securities   Depository"  means  a  recognized   securities
depository  (or  its  successor or substitute)  selected  by  the
Issuer  to  act as the securities depository maintaining  a  book
entry system for a particular series of Bonds.

Securities Depository Nominee

     "Securities  Depository Nominee" means, with  respect  to  a
particular  series of Bonds and as to any Securities  Depository,
such  Securities  Depository or the nominee  of  such  Securities
Depository  in  whose  name the Bonds of  such  series  shall  be
registered  on  the registration books of the Issuer  during  the
time  such  series  of Bonds are held under a book  entry  system
through such Securities Depository.

Trustee

     "Trustee"  means  the trustee serving  as  such  under  this
Indenture,  including any successor Trustee serving or  appointed
pursuant to Sections 9.05 or 9.08 hereof.


                           ARTICLE II

                           THE BONDS

     SECTION 2.01.  Authorized Amount of Bonds.  No Bonds may  be
issued   under  the  provisions  of  this  Indenture  except   in
accordance with this Article II.

     SECTION  2.02.  Issuance of Bonds.  There shall be initially
issued  under and secured by this Indenture Bonds of the  Issuer,
in  the aggregate principal amount of Two Hundred Sixteen Million
and No/100ths Dollars ($216,000,000) for the purpose of currently
refunding a portion of the Series A Bonds and all of the Series C
Bonds  related  to  the  refinancing of the  acquisition  of  the
Project.   Said  Bonds  shall  be designated  "Pollution  Control
Revenue  Refunding Bonds (System Energy Resources, Inc.  Project)
Series 1998", shall bear interest (calculated on the basis  of  a
year  of  360 days and twelve 30-day months) at the rate of  five
and  seven-eighths per centum (5.875%) per annum, which  interest
shall  be  payable  semi-annually on the 1st days  of  April  and
October in each year, commencing April 1, 1999, and shall mature,
subject to prior redemption as hereinafter set forth, on the  1st
day of April, 2022.

     SECTION  2.03.   Form  of Bonds.  The definitive  Bonds  are
issuable   as   fully   registered  Bonds  without   coupons   in
denominations  of $5,000 or any integral multiple  thereof.   The
definitive  Bonds shall be substantially in the form  hereinabove
set  forth,  with  such  appropriate  variations,  omissions  and
insertions as are permitted or required by this Indenture and may
have endorsed thereon such legends or text as may be necessary or
appropriate to conform to any applicable rules and regulations of
any  governmental  authority or any usage or requirement  of  law
with respect thereto.

     SECTION 2.04.  Details, Execution and Payment.  Each Bond of
each series shall be dated as of the date of authentication,  and
shall  bear interest from the latest semi-annual interest payment
date  to which interest has been paid on the Bonds of such series
preceding  the  date  of  authentication,  unless  such  date  of
authentication is an interest payment date to which  interest  is
being  paid on the Bonds of such series, in which case  it  shall
bear  interest  from such date of authentication,  provided  that
Bonds  of  each series authenticated prior to the first  interest
payment  date  of  such series shall bear interest  from  a  date
specified for such series, which date, in the case of the  Series
1998 Bonds, shall be October 15, 1998.

     The  Bonds  shall  be  executed by the manual  or  facsimile
signature  of  the Executive Director of the Issuer  and  by  the
manual  or facsimile signature of its Secretary and the  seal  of
the  Issuer  or a facsimile thereof shall be affixed  thereto  or
imprinted thereon.

     All  authorized  facsimile signatures shall  have  the  same
force and effect as manual signatures.

     In  case  any officer whose signature or facsimile signature
shall  appear on any Bonds shall cease to be such officer  before
the  delivery  of  such Bonds, such signature or  such  facsimile
signature  shall  nevertheless be valid and  sufficient  for  all
purposes  as  if such officer had remained in office  until  such
delivery,  and  also  any  Bond may be  signed  by  or  bear  the
facsimile signature of such persons as at the actual time of  the
execution of such Bond shall be the proper officers to sign  such
Bond  although at the date of delivery of such Bond such  persons
may not have been such officers.

     The  principal  of  and  redemption  premium,  if  any,  and
interest  on  the  Bonds  shall  be  payable  on  or  before  the
respective  dates of payment therefor in any coin or currency  of
the  United  States of America which on the respective  dates  of
payment  thereof is legal tender for the payment  of  public  and
private debts.  The principal of and redemption premium, if  any,
on  all  Bonds shall be payable at the principal corporate  trust
office  of the Trustee, and payment of the interest on each  Bond
shall be made by the Trustee on each interest payment date to the
person   appearing  on  the  registration  books  of  the  Issuer
hereinafter provided for as the owner thereof, by check or  draft
mailed  to  such  owner  at his address as  it  appears  on  such
registration  books.  Payment of the principal of and  redemption
premium, if any, on all Bonds shall be made upon the presentation
and  surrender  of such Bonds as the same shall  become  due  and
payable.

     The  person  in  whose  name  any  Bond  of  any  series  is
registered  at  the  close of business on  any  record  date  (as
hereinafter  defined) with respect to any interest  payment  date
for  the  Bonds of such series shall be entitled to  receive  the
interest  payable  on such interest payment date  notwithstanding
the  cancellation  of  such Bond upon any  transfer  or  exchange
thereof  subsequent to the record date and prior to such interest
payment  date,  except  if and to the extent  there  shall  be  a
default  in  the  payment of the interest due  on  such  interest
payment date, in which case such defaulted interest shall be paid
to  the  person  in whose name such Bond (or any  Bond  or  Bonds
issued,   directly  or  after  intermediate  transactions,   upon
transfer or exchange or in substitution thereof) is registered on
a   subsequent  record  date  for  such  payment  established  as
hereinafter   provided.   A  subsequent  record   date   may   be
established  by  the Issuer at the direction of  the  Company  by
notice mailed to the Trustee and the holders of the Bonds of  the
affected  series  not  less than ten days preceding  such  record
date, which record date shall not be less than five nor more than
thirty  days prior to the subsequent interest payment date.   The
term  "record date" as used in this Section 2.04 with respect  to
any regular interest payment date shall mean the fifteenth day of
the  month  next preceding such interest payment  date,  if  such
interest payment date shall be the first day of a month,  or  the
first  day of the month in which such interest payment date shall
fall, if such interest payment date shall be the fifteenth day of
a  month,  or, if such day shall be a legal holiday or a  day  on
which   banking   institutions  in  Jacksonville,   Florida   are
authorized  by law to close, the next preceding day  which  shall
not be a legal holiday or a day on which such institutions are so
authorized to close.

     SECTION   2.05.   Authentication,  Registration,   Exchange,
Transfer  and  Ownership of Bonds.   Only such of  the  Bonds  as
shall  have  endorsed  thereon  a certificate  of  authentication
substantially in the form hereinabove set forth, duly executed by
the  Trustee, shall be entitled to any benefit or security  under
this  Indenture.   No Bond shall be valid or obligatory  for  any
purpose unless and until such certificate of authentication shall
have  been duly executed by the Trustee, and such certificate  of
the  Trustee upon any such Bond shall be conclusive evidence that
such  Bond  has been duly authenticated and delivered under  this
Indenture.   The Trustee's certificate of authentication  on  any
Bond  shall be deemed to have been duly executed if signed by  an
authorized  representative of the Trustee, but it  shall  not  be
necessary   that  the  same  officer  sign  the  certificate   of
authentication  on all of the Bonds that may be issued  hereunder
at any one time.

     Bonds,  upon  surrender thereof at the  principal  corporate
trust  office  of  the Trustee, together with an assignment  duly
executed by the owner or his attorney or legal representative  in
such  form as shall be satisfactory to the Trustee, may,  at  the
option  of the owner thereof, be exchanged for an equal aggregate
principal amount of Bonds of the same series and maturity, of any
denomination  or denominations authorized by this Indenture,  and
bearing interest at the same rate.

     The Trustee is hereby appointed as bond registrar (the "Bond
Registrar") and as such shall keep books for the registration and
for  the  registration of transfer of Bonds as provided  in  this
Indenture.

     The  transfer  of any Bond may be registered only  upon  the
books  kept for the registration and registration of transfer  of
Bonds upon surrender thereof to the Bond Registrar together  with
an assignment duly executed by the owner or his attorney or legal
representative in such form as shall be satisfactory to the  Bond
Registrar.   Upon any such registration of transfer,  the  Issuer
shall  execute and the Trustee shall authenticate and deliver  in
exchange  for  such Bond a new Bond or Bonds, registered  in  the
name  of  the  transferee, of any denomination  or  denominations
authorized  by  this Indenture in an aggregate  principal  amount
equal to the principal amount of such Bond of the same series and
maturity and bearing interest at the same rate.

     In  all  cases  in  which Bonds shall be  exchanged  or  the
transfer of Bonds shall be registered hereunder, the Issuer shall
execute  and  the Trustee shall authenticate and deliver  at  the
earliest practicable time Bonds in accordance with the provisions
of this Indenture.  All Bonds surrendered in any such exchange or
registration  of  transfer shall forthwith be  cancelled  by  the
Trustee.   The Issuer or the Trustee may make a charge for  every
such exchange or registration of transfer of Bonds sufficient  to
reimburse  it  for  any  tax,  fee or other  governmental  charge
required to be paid with respect to such exchange or registration
of  transfer, and such charge shall be paid before any  such  new
Bonds shall be delivered.

     As  to any Bond, the person in whose name the same shall  be
registered  shall  be deemed and regarded as the  absolute  owner
thereof  for  all purposes, and payment of or on account  of  the
principal  of or redemption premium, if any, or interest  on  any
such  Bond  shall be made only to or upon the order of the  owner
thereof or his legal representative.  All such payments shall  be
valid  and effectual to satisfy and discharge the liability  upon
such  Bond, including the interest thereon, to the extent of  the
sum  or  sums  so  paid.  Neither the Issuer,  the  Trustee,  the
Company nor the Bond Registrar shall be affected by any notice to
the contrary.

     SECTION 2.06.  Delivery of Series 1998 Bonds; Application of
Proceeds.  (a) Upon the execution and delivery of this Indenture,
the  Issuer  shall  execute and deliver to the  Trustee  and  the
Trustee shall authenticate the Series 1998 Bonds and deliver them
to the purchasers thereof against payment therefor as directed by
the Issuer as hereinafter in this Section 2.06 provided.

     (b)  Prior to the delivery by the Trustee of the Series 1998
Bonds, there shall be delivered to the Trustee:

          (1)   A copy, certified by the Secretary of the Issuer,
     of  the  resolutions  adopted by the Board  authorizing  the
     execution  and  delivery of the Agreement,  authorizing  the
     acceptance  and assignment of a Note relating to the  Series
     1998  Bonds,  and authorizing the execution and delivery  of
     this Indenture and the issuance of the Series 1998 Bonds.

          (2)  An executed counterpart of the Agreement.

          (3)   A  certificate of the Company  stating  that  the
     Company  has approved the issuance of the Series 1998  Bonds
     and  the  price thereof as required by Section  2.2  of  the
     Agreement.

          (4)   A  request  and authorization to the  Trustee  on
     behalf  of  the Issuer, signed by the Executive Director  of
     the  Issuer,  to  authenticate and deliver the  Series  1998
     Bonds  to the purchasers thereof identified upon payment  to
     the  Trustee, but for the account of the Issuer,  of  a  sum
     specified in such request and authorization.

          (5)   A  Note  relating to the Series 1998  Bonds  duly
     executed  on  behalf  of the Company  and  assigned  to  the
     Trustee.

          (6)    An  opinion  of  nationally  recognized  counsel
     experienced  on  the  subject of municipal  bonds  that  the
     interest  on  the Series 1998 Bonds is excluded  from  gross
     income  for federal income tax purposes, except for interest
     on  any Series 1998 Bond for any period during which  it  is
     held  by a person who is a "substantial user" of the Project
     or a "related person" as defined in the 1954 Code.

          (7)   A  copy of the request filed by the Company  with
     the County for the redemption of the principal amount of the
     Series A Bonds and the Series C Bonds set forth therein, and
     a  certified  copy of the resolution of the  County  calling
     such Series A Bonds and the Series C Bonds for redemption.

     (c)   Upon  the  issuance and delivery of  the  Series  1998
Bonds, the Trustee shall apply the proceeds from the sale of  the
Series 1998 Bonds as follows:

          (1)   The  accrued interest (if any) received from  the
     sale  of  the Series 1998 Bonds shall be deposited into  the
     Bond Fund;

          (2)   $9,925,000  of such proceeds shall  be  deposited
     with  the  trustee under the Trust Indenture,  dated  as  of
     December 1, 1983, pursuant to which the Series A Bonds  were
     issued  and  secured,  and shall be applied  solely  to  the
     redemption of a portion of the Series A Bonds within 90 days
     after the date of initial issuance of the Series 1998 Bonds;
     and

          (3)   $204,455,000 of such proceeds shall be  deposited
     with  the  trustee under the Trust Indenture,  dated  as  of
     December 1, 1984, pursuant to which the Series C Bonds  were
     issued  and  secured,  and shall be applied  solely  to  the
     redemption of all of the Series C Bonds within 90 days after
     the date of initial issuance of the Series 1998 Bonds.

     SECTION 2.07.  Temporary Bonds.  Until definitive Bonds  are
ready  for  delivery, there may be executed, and upon request  of
the  Issuer, the Trustee shall authenticate and deliver, in  lieu
of  definitive  Bonds  and subject to the  same  limitations  and
conditions,   temporary   printed,  engraved,   lithographed   or
typewritten  Bonds,  in  the  form of  registered  Bonds  without
coupons  in  the denomination of $5,000 or any integral  multiple
thereof,  substantially of the tenor hereinabove  set  forth  and
with such appropriate omissions, insertions and variations as may
be required.

     Until definitive Bonds are ready for delivery, any temporary
Bond may be exchanged at the principal corporate trust office  of
the  Trustee, without charge to the holder thereof, for an  equal
aggregate  principal amount of temporary Bonds of like tenor,  of
the  same  series and maturity and bearing interest at  the  same
rate.

     If  temporary Bonds shall be issued, the Issuer shall  cause
the  definitive  Bonds  to be prepared and  to  be  executed  and
delivered  to the Trustee, and the Trustee, upon presentation  to
it at its principal corporate trust office of any temporary Bond,
shall  cancel the same and authenticate and deliver  in  exchange
therefor  at the principal corporate trust office of the Trustee,
without charge to the holder thereof, a definitive Bond or  Bonds
of  an  equal aggregate principal amount, of the same series  and
maturity  and bearing interest at the same rate as the  temporary
Bond  surrendered.  Until so exchanged the temporary Bonds  shall
in  all respects be entitled to the same benefit and security  of
this  Indenture  as  the  definitive  Bonds  to  be  issued   and
authenticated hereunder.

     SECTION 2.08.  Mutilated, Destroyed or Lost Bonds.  In  case
any Bond secured hereby shall become mutilated or be destroyed or
lost,  the  Issuer shall cause to be executed,  and  the  Trustee
shall authenticate and deliver, a new Bond of like date and tenor
in  exchange  and  substitution for and upon the cancellation  of
such  mutilated Bond, or in lieu of and in substitution for  such
Bond  destroyed or lost, upon the holder's paying the  reasonable
expenses  and charges of the Issuer and the Trustee in connection
therewith  and,  in  the case of a Bond destroyed  or  lost,  his
filing  with  the Trustee evidence satisfactory to it  that  such
Bond  was  destroyed or lost, and of his ownership  thereof,  and
furnishing  the Issuer and the Trustee indemnity satisfactory  to
them.

     SECTION  2.09.   Destruction of  Bonds.    All  Bonds  paid,
redeemed  or  purchased, either at or before maturity,  shall  be
cancelled upon the payment, redemption or purchase of such  Bonds
and  shall  be  delivered  to  the  Trustee  when  such  payment,
redemption or purchase is made.  All Bonds cancelled under any of
the   provisions  of  this  Indenture  shall  be  destroyed,   in
accordance  with  applicable law, by  the  Trustee,  which  shall
execute  a  certificate  in triplicate describing  the  Bonds  so
destroyed, and one executed certificate shall be filed  with  the
Issuer   and  one  with  the  Company  and  the  other   executed
certificate shall be retained by the Trustee.

     SECTION 2.10.  Additional Bonds.   Additional Bonds  may  be
issued  under and secured by this Indenture at one time  or  from
time  to  time, in addition to the Series 1998 Bonds and, subject
to  the conditions hereinafter provided in this Section 2.10, for
the  purpose  of providing funds for refunding any of  the  Bonds
then  Outstanding  of any series, including the  payment  of  any
redemption  premium thereon, interest to accrue to  the  selected
redemption date, any serial maturities to become due prior to the
selected redemption date and any expenses in connection with such
refunding  (any  such  Additional  Bonds  to  be  identified   as
"Refunding Bonds").  Before any Additional Bonds shall be  issued
under  the provisions of this Section 2.10, the Board shall adopt
a  resolution authorizing the issuance of such Additional  Bonds,
fixing  the amount thereof and designating the outstanding  Bonds
to  be refunded with the proceeds of such Additional Bonds.  Such
Additional Bonds shall be designated, shall be stated  to  mature
on  such  date  or  dates and in such year or years,  shall  bear
interest,  payable  on  such dates, at such  rate  or  rates  not
exceeding the maximum rate then permitted by law, and may be made
redeemable at such times and prices (subject to the provisions of
Article  III  of this Indenture), as all may be provided  by  the
resolution  authorizing  the issuance of such  Additional  Bonds.
Except  as  to  any  difference in  the  date,  the  maturity  or
maturities,  the rate or rates of interest or the provisions  for
redemption  by  sinking fund or otherwise, such Additional  Bonds
shall  be  on  a parity with and shall be entitled  to  the  same
benefit and security of this Indenture as the Series 1998 Bonds.

     Such Additional Bonds shall be executed substantially in the
form and manner hereinabove set forth and shall be deposited with
the  Trustee for authentication, but before such Additional Bonds
shall  be authenticated and delivered by the Trustee, there shall
be delivered to the Trustee the following:

     (a)   A  copy, certified by the Secretary of the Issuer,  of
the  resolution adopted by the Board authorizing the issuance  of
such   Additional   Bonds  in  the  amount   specified   therein,
authorizing  the acceptance and assignment of a Note relating  to
such  Additional Bonds, and providing for the application of  the
proceeds thereof.

     (b)   A  certificate of the Company stating that the Company
has approved the issuance of such Additional Bonds, including the
terms, manner of issuance, purchase price and disposition of  the
proceeds  thereof, and the terms and conditions of any supplement
to this Indenture entered into in connection with such Additional
Bonds.

     (c)   An  executed  counterpart  of  any  amendment  to  the
Agreement.

     (d)  An opinion of nationally recognized counsel experienced
on  the  subject  of municipal bonds that the  issuance  of  such
Additional  Bonds  and the application of the  proceeds  of  such
Additional  Bonds  to the purpose or purposes  described  in  the
resolution mentioned in clause (a) of this Section 2.10 will  not
result in the interest on any Bonds theretofore issued under this
Indenture  and  then outstanding or any portion thereof  becoming
included in gross income for federal income tax purposes,  except
as  to  any such Bond held by a "substantial user" of the Project
or a "related person" within the meaning of the 1954 Code (or any
applicable successor provision of law), and that the interest  on
such  Additional Bonds will be so excluded from gross income  for
federal income tax purposes.

     (e)   A Note relating to such Additional Bonds duly executed
on behalf of the Company and assigned to the Trustee.

     (f)   A  copy of the request filed by the Company  with  the
Issuer  for  the refunding of outstanding Bonds, and a  certified
copy  of  the  resolution  of  the Board  with  respect  to  such
refunding.

     SECTION 2.11.  Book Entry System.

     (a)   Notwithstanding  anything to the contrary  herein,  so
long  as  a  series  of Bonds is being held under  a  book  entry
system,  transfers of beneficial ownership of the Bonds  of  such
series   will  be  effected  pursuant  to  rules  and  procedures
established by the Securities Depository.

     (b)   As  long  as a book entry system is in  effect  for  a
series  of  Bonds,  the  Securities Depository  Nominee  will  be
recognized  as  the holder of the Bonds of such  series  for  the
purposes  of (1) paying the principal of, redemption premium,  if
any,  or interest on such Bonds, (2) if Bonds of such series  are
to  be redeemed in part, selecting the portions of such Bonds  to
be  redeemed, (3) giving any notice permitted or required  to  be
given  to  holders  under  this Indenture,  (4)  registering  the
transfer  of such Bonds, and (5) requesting any consent or  other
action  to  be taken by the holders of such Bonds,  and  for  all
other purposes whatsoever, and neither the Trustee nor the Issuer
shall be affected by any notice to the contrary.

     (c)   Neither  the  Trustee nor the Issuer  shall  have  any
responsibility  or obligation to any participant, any  beneficial
owner or any other person claiming a beneficial ownership in  any
Bonds  which  are  registered to a Securities Depository  Nominee
under  or through the Securities Depository with respect  to  any
action  taken  by  the Securities Depository as  holder  of  such
Bonds.

     (d)   The  Trustee shall pay all principal of and redemption
premium, if any, and interest on Bonds issued under a book  entry
system,  only  to  the Securities Depository, or  the  Securities
Depository Nominee, as the case may be, for such Bonds,  pursuant
to  a  letter  of representations or similar agreement  with  the
Securities  Depository and all such payments shall be  valid  and
effectual  to  fully satisfy and discharge the  obligations  with
respect  to the principal of and redemption premium, if any,  and
interest  on  such Bonds.  The Issuer and the Trustee acknowledge
that  the  terms and provisions of such letter of representations
or   similar  agreement  shall  govern  in  the  event   of   any
inconsistency between the provisions of this Indenture  and  such
letter of representations or similar agreement.
     
     (e)   In the event that the Issuer determines that it is  in
the  best  interest of the Issuer to discontinue the  book  entry
system of transfer for series of Bonds, or that the interests  of
the  beneficial  owners  of  the Bonds  of  such  series  may  be
adversely  affected if the book entry system is  continued,  then
the Issuer shall notify the Securities Depository and the Trustee
of  such  determination.  In such event, the Issuer shall execute
and the Trustee shall authenticate, register and deliver physical
certificates for Bonds of such series in exchange for  the  Bonds
registered  in  the  name of the Securities  Depository  Nominee;
provided, in addition, that any Bonds of such series shall be  in
registered form within the meaning of Section 149(a) of the Code.

     (f)   In  the  event  that the Securities Depository  for  a
series  of Bonds discontinues providing its services, the  Issuer
shall either engage the services of another Securities Depository
or  deliver  physical  certificates in the  manner  described  in
clause  (e) above; provided, in addition, that any Bonds of  such
series  shall  be  in  registered  form  within  the  meaning  of
Section 149(a) of the Code.

     (g)  In connection with any notice or other communication to
be  provided to the holders of a series of Bonds by the Issuer or
by  the Trustee with respect to any consent or other action to be
taken by the holders, the Issuer or the Trustee, as the case  may
be,  shall  establish  a record date for such  consent  or  other
action and give the Securities Depository Nominee notice of  such
record  date not less than fifteen (15) days in advance  of  such
record date to the extent possible.

     (h)   The Series 1998 Bonds shall be issued initially in the
form  of  two  global certificates under the  book  entry  system
maintained  by The Depository Trust Company, New York,  New  York
("DTC"),  as  the  initial Securities Depository,  and  shall  be
registered  in the name of Cede & Co., as the initial  Securities
Depository  Nominee for the Series 1998 Bonds.  As  long  as  the
Series  1998  Bonds are maintained by DTC under  its  book  entry
system, all payments with respect to the principal of, redemption
premium,  if  any, and interest on Series 1998 Bonds and  notices
shall  be  made  and given, respectively, to DTC  pursuant  to  a
letter of representations with DTC.


                          ARTICLE III

              REDEMPTION OF BONDS BEFORE MATURITY

     SECTION  3.01.  Optional Redemption.  The Series 1998  Bonds
are  subject  to  optional redemption  by  the  Issuer  prior  to
maturity on or after October 1, 2003, in whole or in part at  any
time,  at  the  written  direction of  the  Company  pursuant  to
Section 4.9 of the Agreement, at the redemption prices (expressed
as percentages of principal amount) set forth in the table below,
plus accrued interest to the redemption date:

                                              Optional
        Redemption Period                    Redemption
      (all dates inclusive)                    Price

     October 1, 2003 through September 30, 2004   102%
     October 1, 2004 through September 30, 2005   101
     October 1, 2005 and thereafter               100

     If  less  than all of the Bonds of a series shall be  called
for  redemption, the particular Bonds or portions of Bonds to  be
redeemed shall be selected by the Trustee by lot or in such other
random manner as the Trustee in its discretion may determine.

     SECTION  3.02.   Special Optional Redemptions.   The  Series
1998  Bonds will be subject to optional redemption by the Issuer,
at  the written direction of the Company pursuant to Section  4.9
of  the  Agreement, in whole but not in part, at any time,  at  a
redemption  price  equal  to the principal  amount  thereof  plus
accrued  interest  to the redemption date but without  redemption
premium if:

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

     (b)   the  Company shall have determined that the  continued
operation  of  the  Project  is  impracticable,  uneconomical  or
undesirable  due to (1) the imposition of taxes,  other  than  ad
valorem taxes currently levied upon privately owned property used
for the same general purpose as the Project, or other liabilities
or  burdens with respect to the Project or the operation thereof,
(2)  changes in technology, in environmental standards  or  legal
requirements  or  in  the  economic  availability  of  materials,
supplies,  equipment or labor or (3) destruction of or damage  to
all or part of the Project;

     (c)   all  or substantially all of the Project or the  Plant
shall have been condemned or taken by eminent domain; or

     (d)   the  operation of the Project or the Plant shall  have
been  enjoined  or  shall have otherwise been  prohibited  by  an
order, decree, rule or regulation of any court or of any federal,
state  or  local regulatory body, administrative agency or  other
governmental body.
     
     The  Series  1998  Bonds will also be  subject  to  optional
redemption by the Issuer, at the written direction of the Company
pursuant  to Section 4.9 of the Agreement, in whole  but  not  in
part, at any time prior to October 1, 2003, at a redemption price
equal to 102% of the principal amount being redeemed plus accrued
interest  to  the  redemption date, if  the  Company  shall  have
consolidated with or merged with or into another corporation,  or
sold  or  otherwise transferred all or substantially all  of  its
assets.

     In  any  such case, the Issuer, at the written direction  of
the  Company pursuant to Section 4.9 of the Agreement, shall give
written  notice to the Trustee directing the Trustee to take  all
action  necessary to redeem the outstanding Series 1998 Bonds  in
whole  and  on a date specified in such notice, which  redemption
date  shall be not less than forty-five (45) nor more than ninety
(90) days from the date the notice is received by the Trustee.

     SECTION  3.03.   Special Mandatory Redemption.   The  Series
1998  Bonds  are  also  subject to  mandatory  redemption,  at  a
redemption  price  equal to the principal amount  being  redeemed
plus  accrued interest to the redemption date, on the  180th  day
(or  such earlier date as may be designated by the Company) after
a  final determination by a court of competent jurisdiction or an
administrative agency to the effect that as a result of a failure
by   the   Company   to  observe  any  covenant,   agreement   or
representation  contained  in the  Agreement  or  the  Issuer  to
observe  any  covenant,  agreement  or  representation  in   this
Indenture, the interest payable on the Series 1998 Bonds  is  not
excludable for federal income tax purposes from the gross  income
of the owners thereof (other than any owner who is a "substantial
user" of the Project or a "related person" within the meaning  of
Section  103(b)(13)  of the 1954 Code.  No determination  by  any
court  or  administrative agency will be considered final  unless
the  Company  has  received  timely notice  of  and  has  had  an
opportunity  to participate in the proceeding which  resulted  in
such  determination.   The Series 1998 Bonds  will  be  redeemed,
either  in  whole or in part, in such principal amount  that  the
interest  payable on the Series 1998 Bonds remaining  outstanding
after  such  redemption would not under Section 103 of  the  1954
Code  be included in the gross income of any owner thereof (other
than  an  owner who is a "substantial user" of the Project  or  a
"related person" within the meaning of Section 103(b)(13) of  the
1954 Code).

     SECTION  3.04.  Notice of Redemption.  (a) At least  twenty-
five  (25)  days  but not more than sixty (60)  days  before  the
redemption  date of any Bonds, either in whole or  in  part,  the
Trustee shall cause a notice of any such redemption to be mailed,
first  class mail, postage prepaid, to all owners of Bonds to  be
redeemed in whole or in part at their addresses as they appear on
the  registration  books  hereinabove provided  for.   Each  such
notice  shall  set  forth  the date  fixed  for  redemption,  the
redemption  price to be paid and, if less than all of  the  Bonds
then  Outstanding shall be called for redemption, the distinctive
numbers and letters, if any, of such Bonds to be redeemed and, in
the case of Bonds to be redeemed in part only, the portion of the
principal amount thereof to be redeemed.  In case any Bond is  to
be  redeemed in part only, the notice of redemption which relates
to  such  Bond  shall state also that on or after the  redemption
date, upon surrender of such Bond, a new Bond in principal amount
equal to the unredeemed portion of such Bond will be issued.   In
the  case  of an optional redemption, the Company shall give  the
Issuer and the Trustee reasonable notice of its exercise of  such
right  of optional redemption so as to allow the Trustee to  give
the required notice to the owners of all Bonds to be redeemed.

     (b)   With  respect to notice of redemption of any Bonds  at
the option of the Issuer (at the written direction of the Company
pursuant  to  Section  4.9  of  the  Agreement),  unless   moneys
sufficient to pay the principal of, redemption premium,  if  any,
and  interest  on any such Bonds to be redeemed shall  have  been
received by the Trustee prior to the giving of such notice,  such
notice  may state that said redemption shall be conditioned  upon
the receipt of such moneys by the Trustee on or prior to the date
fixed for such redemption.  If such moneys shall not have been so
received, such notice shall be of no force and effect, the Issuer
shall not redeem such Bonds and the Trustee shall give notice  to
the  owners of all Bonds which were to have been redeemed, in the
manner  in  which the notice of redemption was given,  that  such
moneys were not so received.

     SECTION  3.05.  Effect of Call for Redemption.  On the  date
so  designated for redemption, notice having been  given  in  the
manner  and under the conditions hereinabove provided, the  Bonds
or portions of Bonds so called for redemption shall become and be
due  and  payable at the redemption price provided for redemption
for  such Bonds or portions of Bonds on such date, and moneys for
payment  of  the  redemption price and accrued  interest  to  the
redemption  date being held by the Trustee in a separate  account
in  the  Bond  Fund  in trust for the holders  of  the  Bonds  or
portions  thereof  to  be  redeemed,  all  as  provided  in  this
Indenture, interest on the Bonds or portions of Bonds  so  called
for  redemption shall cease to accrue, such Bonds or portions  of
Bonds shall cease to be entitled to any benefit or security under
this Indenture, and the holder of such Bonds or portions of Bonds
shall have no rights in respect thereof except to receive payment
of  the  redemption  price thereof and accrued  interest  to  the
redemption date.

     SECTION 3.06.  Partial Redemption.  In case part but not all
of  an  outstanding  Bond shall be selected for  redemption,  the
owner  thereof  or  his  attorney or legal  representative  shall
present and surrender such Bond to the Trustee for payment of the
principal amount thereof so called for redemption, and the Issuer
shall  execute and the Trustee shall authenticate and deliver  to
or  upon  the  order  of  such owner or  his  attorney  or  legal
representative,  without  charge  therefor,  for  the  unredeemed
portion  of  the  principal amount of the Bond so surrendered,  a
Bond of the same series and maturity and bearing interest at  the
same rate.

     SECTION 3.07.  Funds in Trust; Unclaimed Funds.  All  moneys
which  the  Trustee shall have withdrawn from the  Bond  Fund  or
shall  have  received from any other source  and  set  aside,  or
deposited  with the paying agents, for the purpose of paying  any
of  the  Bonds hereby secured, either at the maturity thereof  or
upon  call  for  redemption, shall  be  held  in  trust  for  the
respective holders of such Bonds.  But any moneys which shall  be
so  set  aside or deposited by the Trustee and which shall remain
unclaimed by the holders of such Bonds for a period of  five  (5)
years  after the date on which such Bonds shall have  become  due
and  payable shall upon request in writing be paid to the Company
or  to such officer, board or body as may then be entitled by law
to  receive  the same, and thereafter the holders of  such  Bonds
shall look only to the Company or to such officer, board or body,
as  the  case may be, for payment and then only to the extent  of
the  amount  so  received without any interest thereon,  and  the
Trustee,  the  Issuer  and  the  paying  agents  shall  have   no
responsibility with respect to such moneys.


                           ARTICLE IV

                       GENERAL COVENANTS

     SECTION  4.01.  Payment of Principal and Redemption Premium,
If Any, and Interest.  The Issuer covenants that it will promptly
pay the principal of and redemption premium, if any, and interest
on  every Bond issued under this Indenture at the place,  on  the
dates  and  in  the  manner provided herein  and  in  said  Bonds
according  to the true intent and meaning thereof, but only  from
the  payments made or to be made under the Agreement and pursuant
to  any Note by the Company specifically pledged herein for  such
purposes.

     SECTION 4.02.  Performance of Covenants; Issuer.  The Issuer
covenants  that it will faithfully perform at all times  any  and
all   covenants,   undertakings,  stipulations   and   provisions
contained  in  this  Indenture, in any and every  Bond  executed,
authenticated  and  delivered  hereunder  and  in  all   of   its
proceedings pertaining hereto.  The Issuer represents that it  is
duly  authorized under the Constitution and laws of the State  of
Mississippi,  including particularly and without  limitation  the
Act,  to  issue the Bonds authorized hereby and to  execute  this
Indenture,  to  accept,  assign and  pledge  the  Notes  and  the
Agreement  and the amounts payable under the Notes and to  pledge
the amounts hereby pledged in the manner and to the extent herein
set forth; that all action on its part necessary for the issuance
of  the Series 1998 Bonds and the execution and delivery of  this
Indenture  and the Agreement has been duly and effectively  taken
and that all action on its part necessary for the issuance of any
Additional  Bonds will be duly and effectively  taken;  that  the
Series 1998 Bonds in the hands of the owners thereof are and will
be  valid and enforceable obligations of the Issuer according  to
the  terms thereof and hereof; and that any Additional  Bonds  in
the  hands  of  the owners thereof will be valid and  enforceable
obligations  of  the Issuer according to the  terms  thereof  and
hereof.

     SECTION 4.03.  Instruments of Further Assurance.  The Issuer
covenants  that, at the direction and expense of the Company,  it
will  do, execute, acknowledge and deliver, or cause to be  done,
executed,    acknowledged   and   delivered,   such    indentures
supplemental  hereto  and  such  further  acts,  instruments  and
transfers  as the Trustee may reasonably require for  the  better
pledging  and  assigning unto the Trustee all  and  singular  the
rights  to payments under the Notes, the Agreement and any  other
income  and  other moneys pledged hereby to the  payment  of  the
principal of and redemption premium, if any, and interest on  the
Bonds.   The Issuer further covenants that it will not create  or
suffer  to  be created any lien, encumbrance or charge  upon  its
interest  in  the Project or any part thereof, the Notes  or  the
Agreement except the lien of this Indenture.

     SECTION  4.04.  Recordation.  The Issuer covenants that,  at
the  direction  and  expense of the Company, it  will  cause  all
instruments  as  may  be necessary to perfect  and  preserve  the
security  interest created by this Indenture to  be  recorded  or
filed  in  such manner and in such places as may be  required  by
law.   Copies  of all such instruments shall be provided  to  the
Trustee.   In the event the Issuer fails to record or  file  such
instruments as may be necessary to preserve the security interest
created  by  this Indenture, the Trustee, at the expense  of  the
Company, is authorized to cause such recordings and filings to be
made.

     SECTION  4.05.   Inspection of Project Books.    The  Issuer
covenants  and  agrees  that  all  books  and  documents  in  its
possession relating to the Project shall at all times be open  to
inspection by the Trustee and its duly authorized agents.

     SECTION  4.06.   Rights Under Agreement.  The  Agreement,  a
duly  executed  counterpart of which  has  been  filed  with  the
Trustee,  sets forth the covenants and obligations of the  Issuer
and  the Company, and reference is hereby made to the same for  a
detailed  statement  of  said covenants and  obligations  of  the
Company thereunder; and the Issuer agrees that the Trustee in its
own  name or in the name of the Issuer may enforce all rights  of
the  Issuer and all obligations of the Company under and pursuant
to the Agreement for and on behalf of the Bondholders, whether or
not the Issuer is in default hereunder.

     SECTION 4.07.  Designation of Additional Paying Agents.  The
Issuer  shall  cause,  at  the  direction  of  the  Company,  the
necessary arrangements to be made through the Trustee and  to  be
thereafter  continued  for the designation of  additional  paying
agents and for providing for the payment of such of the Bonds  as
shall  be  presented  when due at the principal  corporate  trust
office of the Trustee, or its successor in trust hereunder, or at
the  principal office of said additional paying agents.  All such
funds held by said additional paying agents shall be held by each
of  them in trust and shall constitute a part of the trust estate
and shall be subject to the security interest created hereby.


     SECTION  4.08.   Existence of Issuer.  The Issuer  covenants
that  it  will at all times maintain its corporate existence  and
will  duly procure any necessary renewals and extensions thereof;
will use its best efforts to maintain, preserve and renew all the
rights,  powers, privileges and franchises owned by it; and  will
comply with all valid acts, rules, regulations and orders of  any
legislative,   executive,   judicial   or   administrative   body
applicable to the Project and the matters herein provided for.

     SECTION  4.09.   Continuing Disclosure.  It  is  understood,
acknowledged   and  agreed  that  the  Issuer   shall   have   no
responsibility  for  compliance with  the  continuing  disclosure
requirements  set  forth  in  Rule 15c-2-12  promulgated  by  the
Securities and Exchange Commission under the Securities  Exchange
Act of 1934 as in effect on the date of this Indenture, and shall
have  no  liability to the underwriters of the Bonds, the holders
of  the Bonds or any other person with respect to such disclosure
matters.
                           ARTICLE V

                       REVENUES AND FUNDS

     SECTION  5.01.   Source  of Payment  of  Bonds.   The  Bonds
authenticated and delivered hereunder are the obligations of  the
Issuer and the Issuer shall make payments hereunder in respect of
the principal of and redemption premium, if any, and interest  on
such Bonds.  Such Bonds are not general obligations of the Issuer
or  the  State  of  Mississippi or any  county,  municipality  or
political   subdivision   thereof,  but   are   limited   special
obligations  payable  solely from revenues and  proceeds  derived
from the Notes and the Agreement and as provided herein.

     SECTION  5.02.   Creation of Bond  Fund.   There  is  hereby
created  and  established with the Trustee a  trust  fund  to  be
designated  "Mississippi Business Finance  Corporation  Pollution
Control  Revenue  Refunding Bonds (System Energy Resources,  Inc.
Project) Series 1998 Bond Fund".  Moneys deposited therein  shall
be  used to pay the principal of and redemption premium, if  any,
and interest on the Bonds as provided in this Indenture.

     SECTION 5.03.  Payments into the Bond Fund.  There shall  be
deposited  into the Bond Fund that portion of the  proceeds  from
the  sale of the Series 1998 Bonds consisting of accrued interest
on  the  Series 1998 Bonds up to the date of their delivery.   In
addition,  there shall be deposited into the Bond  Fund,  as  and
when  received,  (a)  all repayments of  the  Loan  and  interest
thereon  made  pursuant to the Notes and  the  Agreement  by  the
Company;  and (b) all other moneys received by the Trustee  under
and  pursuant to any of the provisions of the Agreement which are
required, or which are accompanied by directions from the Company
that  such moneys are, to be paid into the Bond Fund.  The Issuer
hereby covenants and agrees that, so long as any of the Bonds are
outstanding, it will deposit, or cause to be paid to the  Trustee
for  deposit  in  the Bond Fund for its account, sufficient  sums
from  revenues  derived pursuant to the Notes and  the  Agreement
promptly to meet and pay the principal of and redemption premium,
if  any,  and  interest on the Bonds as the same become  due  and
payable;   provided,  however,  that  nothing  herein  shall   be
construed  as requiring the Issuer to use any funds  or  revenues
from any source other than revenues derived pursuant to the Notes
and  the Agreement.  The Trustee is authorized to receive at  any
time  payments  or prepayments from the Company pursuant  to  the
Notes and the Agreement for deposit in the Bond Fund.

     SECTION 5.04.  Use of Moneys in the Bond Fund.  All interest
accruing  on  the  Series 1998 Bonds up  to  the  date  of  their
delivery will be paid from the amounts deposited in the Bond Fund
pursuant to the first sentence of Section 5.03 hereof.  Except as
provided in this Indenture, moneys in the Bond Fund shall be used
solely  for  the  payment  of  the principal  of  and  redemption
premium,  if any, and interest on the Bonds.  Upon receipt  of  a
written  notice from the Company pursuant to Section 4.9  of  the
Agreement  or in the case of a directed purchase of  Bonds,  upon
the  deposit of cash or Government Obligations in the  Bond  Fund
sufficient, together with other amounts available therefor in the
Bond Fund, to make the directed purchase of Bonds, the Issuer and
the  Trustee covenant and agree to take and cause to be taken the
necessary  steps to redeem or purchase such principal  amount  of
Bonds  as  specified  by  the Company  in  such  written  notice;
provided, however, that any available moneys in the Bond Fund may
be used on direction of the Company to redeem a part of the Bonds
Outstanding  and  then  redeemable  or  to  purchase  Bonds   for
cancellation  so  long  as the Company is  not  in  default  with
respect  to any payments required pursuant to the Notes  and  the
Agreement  and  to the extent said moneys are in  excess  of  the
amount  required for payment of the Bonds theretofore matured  or
called for redemption and interest accrued and payable in respect
of Outstanding Bonds.

     SECTION  5.05.   Custody of the Bond Fund.   The  Bond  Fund
shall  be  in the custody of the Trustee but in the name  of  the
Issuer,  and the Issuer hereby authorizes and directs the Trustee
to  withdraw  sufficient funds from the  Bond  Fund  to  pay  the
principal of and redemption premium, if any, and interest on  the
Bonds  as the same become due and payable and to make said  funds
so  withdrawn available to the paying agents hereunder  at  their
principal  office, for the purpose of paying said  principal  and
redemption premium, if any, and interest, which authorization and
direction the Trustee hereby accepts.

     SECTION  5.06.  Non-presentment of Bonds.  In the event  any
Bond  shall  not  be  presented for payment  when  the  principal
thereof becomes due, either at maturity or at the date fixed  for
redemption or purchase thereof, if funds sufficient to  pay  such
Bond shall have been deposited in the Bond Fund or otherwise made
available  to the Trustee through deposit therein as provided  in
Section  5.03, all liability of the Issuer to the holder  thereof
for the payment of such Bond shall forthwith cease, terminate and
be  completely discharged, and thereupon it shall be the duty  of
the  Trustee to hold such funds within a separate account in  the
Bond  Fund,  subject  to the provisions of Section  3.07  hereof,
without  liability for interest thereon, for the benefit  of  the
holder  of  such  Bond, which shall thereafter  (subject  to  the
provisions  of Section 3.07 hereof) be restricted exclusively  to
such  funds  for any claim of whatever nature on his  part  under
this Indenture or on, or with respect to, said Bond.

     SECTION  5.07.   Moneys  to Be Held in  Trust.   All  moneys
required  to  be  deposited with or paid to the Trustee  for  the
account  of  the Bond Fund under any provision of this  Indenture
shall  be  held  by the Trustee in trust, and except  for  moneys
deposited with or paid to the Trustee for the redemption of Bonds
or  the payment of Bonds including Bonds which are deemed  to  be
paid within the meaning of Section 7.01 hereof, shall, while held
by  the  Trustee,  constitute part of the  trust  estate  and  be
subject to the security interest created hereby.

     SECTION 5.08.  Repayment to the Company from the Bond  Fund.
Any  amounts  remaining in the Bond Fund (other than  moneys,  if
any,  set aside as provided in Sections 3.03, 3.05, 5.06 and 7.01
hereof),  after  payment in full of the Bonds (or  provision  for
payment  thereof  having  been  made  in  accordance  with   this
Indenture), the fees and expenses of the Issuer, the Trustee  and
any additional paying agent and all other amounts required to  be
paid hereunder and under the Rebate Agreement, shall be repaid to
the Company as provided in Section 6.5 of the Agreement.

     SECTION 5.09.  Transfers to Rebate Fund.  Anything contained
in this Indenture to the contrary notwithstanding (a) the "Rebate
Fund"  established under the Arbitrage Rebate  Agreement  by  and
among  the  Issuer,  the Trustee and the  Company,  dated  as  of
October  15,  1998,  and related to the Series  1998  Bonds  (the
"Rebate  Agreement") shall not be considered part of  the  "trust
estate"  created or pledged by this Indenture and (b) the Trustee
shall be permitted to transfer money on deposit in the Bond  Fund
to  the  Rebate  Fund established under the Rebate  Agreement  to
satisfy the provisions of the Rebate Agreement.


                           ARTICLE VI

                       INVESTMENTS, ETC.

     SECTION 6.01.  Investment of Bond Fund Moneys.   Any  moneys
held  in  the Bond Fund shall be invested and reinvested  by  the
Trustee,  at  the  request  of, and as orally  directed  by,  the
Company, confirmed in writing, in Government Obligations or other
obligations   or  securities  then  permitted   by   law.    Such
investments may be made through the investment department of  the
Trustee.   Any  such investments shall be held by  or  under  the
control of the Trustee and shall be deemed at all times to  be  a
part  of the Bond Fund and the interest accruing thereon and  any
profit  realized from such investments shall be credited  to  the
Bond  Fund and any loss resulting from such investments shall  be
charged  to  the Bond Fund.  The Trustee, upon oral direction  of
the Company confirmed in writing, shall sell and reduce to cash a
sufficient  amount of such investments whenever the cash  balance
in  the  Bond  Fund is insufficient to pay the  principal  of  or
redemption premium, if any, or interest on the Bonds when due.

     SECTION  6.02.  Tax Covenants.  The Issuer and  the  Company
will  not  directly or indirectly use or permit the  use  of  any
proceeds  of  the Bonds or any other funds of the Issuer  or  the
Company, or take or omit to take any action that would cause  the
Bonds  to be "arbitrage bonds" within the meaning of Section  148
(a) of the Code or result in the loss of the exclusion from gross
income  for federal income tax purposes of the interest  paid  on
the  Bonds to the extent afforded under Section 103 of  the  1954
Code.   To that end, the Issuer and the Company will also  comply
with all requirements of the Code and the 1954 Code to the extent
applicable  to  the Bonds.  In the event that  at  any  time  the
Issuer or the Company is of the opinion that for purposes of this
Section  6.02 it is necessary to restrict or limit the  yield  on
the  investment  of  any moneys held by the  Trustee  under  this
Indenture,  the  Issuer  or the Company  shall  so  instruct  the
Trustee in writing, and the Trustee shall take such action as may
be necessary in accordance with such instructions.

     The  Company, the Issuer and the Trustee covenant to  comply
with  the  provisions  of  the Rebate  Agreement  as  the  Rebate
Agreement may be amended or supplemented in accordance  with  its
terms,  and in compliance therewith, the Issuer hereby agrees  to
establish  with  the  Trustee  a Rebate  Fund  under  the  Rebate
Agreement,  which shall not be a trust fund under this Indenture,
and  the  terms of and provisions governing which  shall  be  set
forth  in  the  Rebate Agreement; provided that  said  compliance
shall  not  be required if the Issuer or the Company delivers  to
the  Trustee an opinion of nationally recognized bond counsel  to
the  effect  that  compliance is not  required  to  preserve  the
exclusion  from gross income for federal income tax  purposes  of
interest paid on the Bonds.  In the event of any conflict between
the provisions of the Rebate Agreement and the provisions of this
Indenture,  the provisions of the Rebate Agreement shall  govern.
This covenant shall survive payment in full or defeasance of  the
Bonds.

     The  obligations  imposed upon the Company by  this  Section
have   been   acknowledged  and  accepted  by  the   Company   in
Section 4.10 of the Agreement.


                          ARTICLE VII

                        RELEASE OF LIEN

     SECTION  7.01.  Release of Lien.  If, when any of the  Bonds
shall  have become due and payable in accordance with their terms
as  provided in this Indenture or shall have been duly called for
redemption  or  irrevocable instructions to call such  Bonds  for
redemption  shall have been given by the Issuer to  the  Trustee,
the  whole  amount  of  the principal and the  interest  and  the
redemption  premium, if any, so due and payable upon  such  Bonds
shall  be paid or sufficient cash or Government Obligations  non-
callable by the issuer thereof, the principal of and the interest
on   which   when   due  will  provide,  without  investment   or
reinvestment,  sufficient cash, shall be held by the  Trustee  or
the  paying agents for such purpose under the provisions of  this
Indenture,  then and in that case such Bonds shall  cease  to  be
secured  by the lien of this Indenture, and the Trustee  in  such
case,  on demand of the Issuer or the Company, shall release  the
lien  of  this  Indenture with respect to such  Bonds  and  shall
execute  such  documents  to evidence  such  release  as  may  be
reasonably  required  by  the Issuer or  the  Company;  provided,
however,  that  in  the  event Government  Obligations  shall  be
deposited  with and held by the Trustee or the paying  agents  as
hereinabove  provided, then in addition to the  requirements  set
forth  in Article III of this Indenture, the Trustee shall within
thirty  (30)  days after such Government Obligations  shall  have
been  deposited  with  it  cause a notice  signed  by  it  to  be
published once in a daily newspaper or financial journal having a
general circulation in the financial community in the Borough  of
Manhattan, City and State of New York, setting forth (a) the date
designated for the redemption of such Bonds, (b) a description of
the Government Obligations so held by it and (c) that the lien of
this  Indenture with respect to such Bonds has been  released  in
accordance with the provisions of this Section.

     All moneys and obligations held by the Trustee or the paying
agents  pursuant  to  this Section shall be  held  in  trust  and
applied to the payment, when due, of the principal of, redemption
premium, if any, and interest on such Bonds.

     Notwithstanding  the  satisfaction  and  discharge  of  this
Indenture,  the rights of the Trustee under Sections  9.02,  9.05
and  9.06  hereof, the obligations of the Trustee under  sections
5.04,  5.06  and 5.07 hereof and the obligations of  the  Company
under  Section  6.02  hereof, shall  survive,  anything  in  this
Indenture to the contrary notwithstanding.


                          ARTICLE VIII

           DEFAULT PROVISIONS AND REMEDIES OF TRUSTEE
                        AND BONDHOLDERS

     SECTION  8.01.  Events of Default.  If any of the  following
events  occur, it is hereby defined and declared  to  be  and  to
constitute an "event of default":

     (a)   failure to pay an installment of interest on any  Bond
after  such  interest has become due for a period of  sixty  (60)
days; or

     (b)  failure to pay when due the principal of, or redemption
premium,  if  any,  on any Bond, whether at the  stated  maturity
thereof, or upon proceedings for redemption thereof, or upon  the
maturity thereof by acceleration; or

     (c)   default in the performance or observance of any  other
of  the  covenants, agreements or conditions on the part  of  the
Issuer in this Indenture or in the Bonds, and continuance thereof
for the period after notice specified in Section 8.13 hereof; or

     (d)    the  occurrence  of  an  "event  of  default"   under
Section 5.1 of the Agreement.

     SECTION 8.02. Acceleration.  Upon the occurrence of an event
of  default the Trustee may, and upon the written request of  the
holders  of  not less than 25% in aggregate principal  amount  of
Bonds  then Outstanding shall, by notice in writing delivered  to
the  Issuer and the Company, declare the principal of  all  Bonds
then Outstanding and the interest accrued thereon immediately due
and  payable;  and  such principal and interest  shall  thereupon
become and be immediately due and payable.

     If, after the principal of the Bonds has been so declared to
be  due  and  payable, all arrears of interest  and  interest  on
overdue  installments of interest (if lawful)  at  the  rate  per
annum  borne  by  the  Bonds  and the  principal  and  redemption
premium,  if any, on all Bonds then Outstanding which shall  have
become  due  and payable otherwise than by acceleration  and  all
other sums payable under this Indenture or upon the Bonds, except
the  principal  of,  and interest on, the  Bonds  which  by  such
declaration  shall have become due and payable, are paid  by  the
Issuer,  and the Issuer also performs all other things in respect
of  which  it  may have been in default hereunder  and  pays  the
reasonable  charges of the Issuer, the Trustee,  the  Bondholders
and  any  trustee  appointed under law, including  the  Trustee's
reasonable  attorneys' fees, then, and in every  such  case,  the
Trustee  shall  annul such declaration and its consequences,  and
such  annulment shall be binding upon all holders of Bonds issued
hereunder;  but no such annulment shall extend to or  affect  any
subsequent  default  or  impair any right  or  remedy  consequent
thereon.   The Trustee shall forward a copy of any such annulment
notice pursuant to this paragraph to the Issuer and the Company.

     SECTION  8.03.  Other  Remedies.  If any  event  of  default
occurs and is continuing, except as otherwise provided in Section
8.12 hereof, the Trustee, before or after declaring the principal
of  the  Bonds immediately due and payable, may enforce each  and
every  right granted to it under the Notes and the Agreement  and
any  supplements  or amendments thereto for the  benefit  of  the
Bondholders.  In exercising such rights and the rights given  the
Trustee  under  this Article VIII, the Trustee  shall  take  such
action  as, in the judgment of the Trustee applying the standards
described  in  Section  9.01(a)  hereof,  would  best  serve  the
interests of the Bondholders.

     SECTION  8.04.  Legal Proceedings by Trustee.  If any  event
of  default  has occurred and is continuing, the Trustee  in  its
discretion  may, and upon the written request of the  holders  of
not less than 25% in aggregate principal amount of all Bonds then
Outstanding  and receipt of indemnity to its satisfaction  shall,
in its own name:

     (a   by mandamus, or other suit, action or proceeding at law
or in equity, enforce all rights of the Bondholders;

     (b   bring suit upon the Bonds; or

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

     No  remedy conferred upon or reserved to the Trustee  or  to
the Bondholders by the terms of this Indenture is intended to  be
exclusive  of  any other remedy, but each and every  such  remedy
shall  be cumulative and shall be in addition to any other remedy
given  to the Trustee or to the Bondholders hereunder or  now  or
hereafter existing at law or in equity or by statute.

     No delay or omission to exercise any right or power accruing
upon  any default or event of default shall impair any such right
or power or shall be construed to be a waiver of any such default
or event of default or acquiescence therein; and every such right
and  power may be exercised from time to time as often as may  be
deemed expedient.

     No  waiver  of  any  default or event of default  hereunder,
whether by the Trustee or by the Bondholders, shall extend to  or
shall  affect any subsequent default or event of default or shall
impair any rights or remedies consequent thereon.

     SECTION  8.05.  Right of Bondholders to Direct  Proceedings.
Anything  in this Indenture to the contrary notwithstanding,  the
holders of a majority in aggregate principal amount of Bonds then
Outstanding  shall  have the right, upon  providing  the  Trustee
indemnity  to its satisfaction, at any time, by an instrument  or
instruments in writing executed and delivered to the Trustee,  to
direct the method and place of conducting all proceedings  to  be
taken  in  connection  with  the enforcement  of  the  terms  and
conditions  of  this  Indenture, or  for  the  appointment  of  a
receiver or any other proceedings hereunder; provided, that  such
direction  shall  not  be otherwise than in accordance  with  the
provisions of law or of this Indenture.

     SECTION   8.06.    Appointment  of  Receivers.    Upon   the
occurrence of an event of default, and upon the filing of a  suit
or  other  commencement of judicial proceedings  to  enforce  the
rights  of  the  Trustee  and  of  the  Bondholders  under   this
Indenture, the Trustee shall, to the extent permitted by law,  be
entitled as a matter of right to the appointment of a receiver or
receivers  of  the  trust estate with such powers  as  the  court
making such appointment shall confer.

     SECTION  8.07.  Waiver.  Upon the occurrence of an event  of
default,  to  the  extent that such rights may then  lawfully  be
waived, neither the Issuer, nor the State of Mississippi, nor any
political  subdivision thereof, nor anyone  claiming  through  or
under any of them, shall set up, claim, or seek to take advantage
of  any  appraisement, valuation, stay, extension  or  redemption
laws now or hereafter in force, in order to prevent or hinder the
enforcement of this Indenture, and the Issuer, for itself and all
who  may claim through or under it, hereby waives, to the  extent
that it lawfully may do so, the benefit of all such laws.

     SECTION 8.08. Application of Moneys.  All moneys received by
the Trustee pursuant to any right given or action taken under the
provisions of this Article VIII shall, after payment of the costs
and  expenses  of the proceedings resulting in the collection  of
such  moneys  and  of  the  expenses,  liabilities  and  advances
incurred  or made by the Trustee, be deposited in the  Bond  Fund
and  all moneys (except moneys held in separate accounts  by  the
Trustee pursuant to Sections 3.05, 3.07 and 5.06 hereof)  in  the
Bond Fund shall be applied as follows:

     (a   Unless the principal of all the Bonds shall have become
or  shall  have  been declared due and payable, all  such  moneys
shall be applied:

     FIRST:    To  the  payment  of all amounts owed  the  United
               States of America under the Rebate Agreement;

     SECOND:   To  the payment to the persons entitled thereto of
               all  installments  of interest  then  due  on  the
               Bonds,  in  the  order  of  the  maturity  of  the
               installments of such interest and, if  the  amount
               available shall not be sufficient to pay  in  full
               any  particular installment, then to  the  payment
               ratably,  according  to the amounts  due  on  such
               installment,  to  the  persons  entitled  thereto,
               without any discrimination or privilege; and

     THIRD:    To  the payment to the persons entitled thereto of
               the unpaid principal of and redemption premium, if
               any,  on any of the Bonds which shall have  become
               due  (other  than  Bonds  matured  or  called  for
               redemption  for  the payment of which  moneys  are
               held   pursuant   to   the  provisions   of   this
               Indenture), in the order of their due dates,  with
               interest  on such Bonds from the respective  dates
               upon  which  they became due and,  if  the  amount
               available shall not be sufficient to pay  in  full
               Bonds  due  on any particular date, together  with
               such   interest,  then  to  the  payment  ratably,
               according to the amount of principal due  on  such
               date, to the persons entitled thereto without  any
               discrimination or privilege.

     (b   If the principal of all the Bonds shall have become due
or  shall  have  been declared due and payable, all  such  moneys
shall  be  applied to the payment of all amounts owed the  United
States  of  America under the Rebate Agreement and  then  to  the
payment  of  the principal and interest then due upon the  Bonds,
without preference or priority of principal over interest  or  of
interest  over principal, or of any installment of interest  over
any  other installment of interest, or of any Bond over any other
Bond,  ratably,  according to the amounts  due  respectively  for
principal  and interest, to the persons entitled thereto  without
any discrimination or privilege.

     (c    If  the  principal of all the Bonds  shall  have  been
declared   due  and  payable,  and  if  such  declaration   shall
thereafter  have been rescinded and annulled under the provisions
of   this  Article  VIII  then,  subject  to  the  provisions  of
subsection  (b)  of  this Section 8.08  in  the  event  that  the
principal of all the Bonds shall later become due or be  declared
due  and payable, the moneys shall be applied in accordance  with
the provisions of subsection (a) of this Section 8.08.

     Whenever moneys are to be applied pursuant to the provisions
of this Section 8.08, such moneys shall be applied at such times,
and from time to time, as the Trustee shall determine, having due
regard to the amount of such moneys available for application and
the  likelihood of additional moneys becoming available for  such
application in the future.  Whenever the Trustee shall apply such
funds,  it shall fix the date (which shall be an interest payment
date  unless it shall deem another date more suitable) upon which
such application is to be made and upon such date interest on the
amounts  of  principal to be paid on such dates  shall  cease  to
accrue.   The  Trustee  shall give such notice  as  it  may  deem
appropriate of the deposit with it of any such moneys and of  the
fixing  of  any  such  date, and shall not be  required  to  make
payment  to  the  holder of any Bond until  such  Bond  shall  be
presented  to  the  Trustee for appropriate  endorsement  or  for
cancellation if fully paid.

     Whenever  all principal of and redemption premium,  if  any,
and interest on all Bonds have been paid under the provisions  of
this Section 8.08 and all expenses and charges of the Issuer, the
Trustee and any paying agents have been paid and all amounts owed
the United States of America under the Rebate Agreement have been
paid, any balance remaining in the Bond Fund shall be paid to the
Company as provided in Section 5.08 hereof.

     SECTION  8.09.  Remedies Vested in Trustee.  All  rights  of
action  (including the right to file proof of claims) under  this
Indenture  or  under  any of the Bonds may  be  enforced  by  the
Trustee  without  the  possession of any  of  the  Bonds  or  the
production thereof in any trial or proceedings relating  thereto;
and  any such suit or proceeding instituted by the Trustee  shall
be  brought  in  its  name as Trustee without  the  necessity  of
joining as plaintiffs or defendants any holders of the Bonds; and
any  recovery  of  judgment shall be for the  equal  and  ratable
benefit of the holders of the Bonds then Outstanding.

     SECTION  8.10.   Rights  and Remedies  of  Bondholders.   No
holder  of  any Bond shall have any right to institute any  suit,
action  or proceeding in equity or at law for the enforcement  of
this  Indenture or for the execution of any trust hereof  or  for
the  appointment  of  a receiver or any other  remedy  hereunder,
unless  (a) a default has occurred of which the Trustee has  been
notified  as provided in Section 9.01(h) hereof, or of  which  by
said  subsection  it is deemed to have notice, (b)  such  default
shall have become an event of default and the holders of not less
than  25% in aggregate principal amount of Bonds then Outstanding
shall  have  made written request to the Trustee and  shall  have
offered  it reasonable opportunity either to proceed to  exercise
the powers hereinbefore granted or to institute such action, suit
or  proceeding in its own name, (c) such holders have offered  to
the  Trustee indemnity as provided in Section 9.01(l) hereof, and
(d)  the Trustee shall thereafter fail or refuse to exercise  the
powers hereinbefore granted, or to institute such action, suit or
proceeding  in its own name; and such notification,  request  and
offer  of  indemnity are hereby declared in  every  case  at  the
option of the Trustee to be conditions precedent to the execution
of  the powers and trusts of this Indenture, and to any action or
cause of action for the enforcement of this Indenture, or for the
appointment  of a receiver or for any other remedy hereunder;  it
being understood and intended that no one or more holders of  the
Bonds  shall have any right in any manner whatsoever  to  affect,
disturb  or prejudice the lien of this Indenture by its,  his  or
their  action  or to enforce any right hereunder  except  in  the
manner  herein provided, and that all proceedings at  law  or  in
equity  shall  be instituted, had and maintained  in  the  manner
herein  provided  and for the equal and ratable  benefit  of  the
holders of all Bonds then Outstanding.  Nothing in this Indenture
contained  shall,  however, affect or impair  the  right  of  any
Bondholder  to  enforce  the payment  of  the  principal  of  and
redemption premium, if any, and interest on any Bond at and after
the  maturity thereof, or the obligation of the Issuer to pay the
principal of and redemption premium, if any, and interest on each
of  the  Bonds issued hereunder to the respective holders thereof
at  the time and place, from the source and in the manner in  the
Bonds expressed.

     SECTION  8.11.  Termination of  Proceedings.   In  case  the
Trustee  shall  have proceeded to enforce any  right  under  this
Indenture  by  the appointment of a receiver, or  otherwise,  and
such  proceedings shall have been continued or abandoned for  any
reason,  or  shall have been determined adversely,  then  and  in
every  such case the Issuer and the Trustee shall be restored  to
their  former  positions and rights hereunder,  and  all  rights,
remedies and powers of the Trustee shall continue as if  no  such
proceedings had been taken.

     SECTION 8.12. Waivers of Events of Default.  The Trustee may
in  its  discretion waive any event of default hereunder and  its
consequences   and  rescind  any  declaration  of   maturity   of
principal,  and  shall  do so upon the  written  request  of  the
holders  of  (a) not less than two-thirds in aggregate  principal
amount  of Bonds then Outstanding in respect of which default  in
the payment of principal and/or interest exists, or (b) more than
50%  in  aggregate principal amount of all Bonds then Outstanding
in  the case of any other default; provided, however, that  there
shall  not  be waived (1) any event of default in the payment  of
the  principal  of  any outstanding Bonds when  due  or  (2)  any
default in the payment when due of the interest on any such Bonds
unless  prior  to  such  waiver or  rescission,  all  arrears  of
interest, with interest (to the extent permitted by law)  at  the
rate  borne  by the Bonds in respect of which such default  shall
have  occurred on overdue installments of interest or all arrears
of  payments of principal when due, as the case may be,  and  all
expenses  of  the Trustee in connection with such  default  shall
have been paid or provided for, and in case of any such waiver or
rescission, or in the case any proceeding taken by the Trustee on
account  of  any  such  default shall have been  discontinued  or
abandoned  or determined adversely, then and in every  such  case
the Issuer, the Trustee and the Bondholders shall be restored  to
their former positions and rights hereunder respectively, but  no
such waiver or rescission shall extend to any subsequent or other
default, or impair any right consequent thereon.

     SECTION  8.13.   Notice  of Default under  Section  8.01(c);
opportunity  of  Issuer  and the Company to  Cure  Such  Default.
Anything herein to the contrary notwithstanding, no default under
Section 8.01(c) hereof shall constitute an event of default until
actual  notice  of such default by registered or  certified  mail
shall be given to the Issuer and the Company by the Trustee or by
the holder or holders of not less than 25% in aggregate principal
amount of all Bonds Outstanding (with a copy to the Trustee)  and
the  Issuer  and  the  Company shall have had  sixty  days  after
receipt  of  such notice to correct said default  or  cause  said
default  to be corrected within the applicable period;  provided,
however,  if  said  default is such that it cannot  be  corrected
within the applicable period, it shall not constitute an event of
default if corrective action is instituted by the Issuer  or  the
Company within the applicable period and diligently pursued until
the default is corrected.

     With  regard to any alleged default concerning which  notice
is  given  to the Issuer and the Company under the provisions  of
this  Section  8.13, the Issuer hereby grants  the  Company  full
authority  for the account of the Issuer to perform any  covenant
or  obligation alleged in said notice to constitute a default, in
the  name and stead of the Issuer with full power to do  any  and
all  things and acts to the same extent that the Issuer could  do
and  perform  any  such  things  and  acts  and  with  power   of
substitution.

     In  the  event that the Trustee fails to receive any  amount
when  due  under the Notes and the Agreement, the  Trustee  shall
immediately  give written notice to the Company  specifying  such
failure.
                           ARTICLE IX

                          THE TRUSTEE

     SECTION 9.01. Acceptance of the Trusts.  The Trustee  hereby
accepts the trusts imposed upon it by this Indenture, and  agrees
to  perform  said  trusts,  but only  upon  and  subject  to  the
following express terms and conditions:

     (a    The  Trustee, prior to the occurrence of any event  of
default  and after the curing or waiver of all events of  default
which  may  have occurred, undertakes to perform such duties  and
only such duties as are specifically set forth in this Indenture.
In  case  an  event of default has occurred (which has  not  been
cured  or  waived) the Trustee shall exercise such of the  rights
and  powers  vested in it by this Indenture,  and  use  the  same
degree  of  care  and  skill  in their  exercise,  as  a  prudent
corporate  trustee would exercise or use under the  circumstances
in the enforcement of a corporate indenture.

     (b    The  Trustee may execute any of the trusts  or  powers
hereof  and  perform  any of its duties by or through  attorneys,
agents,  receivers or employees but shall be answerable  for  the
conduct  of  the  same in accordance with the standard  specified
above, and shall be entitled to advice of counsel concerning  all
matters  relating to the trusts hereof and the duties  hereunder,
and may in all cases pay such reasonable compensation to all such
attorneys,  agents, receivers and employees as may reasonably  be
employed  in connection with the trusts hereof.  The Trustee  may
act  upon the opinion or advice of any attorney (who may  be  the
attorney or attorneys for the Issuer or the Company), approved by
the  Trustee  in  the exercise of reasonable care.   The  Trustee
shall  not  be responsible for any loss or damage resulting  from
any  action  or  inaction in good faith  in  reliance  upon  such
opinion or advice.

     (c    The  Trustee shall not be responsible for any  recital
herein, or in the Bonds (except in respect to the certificate  of
the  Trustee endorsed on the Bonds), or for the recording or  re-
recording,  filing or re-filing of this Indenture, or  any  other
instrument required by this Indenture to secure the Bonds, or for
insuring the Project or collecting any insurance moneys,  or  for
the validity of the execution by the Issuer of this Indenture  or
of any supplements hereto or instruments of further assurance, or
for  the  sufficiency  of  the  security  for  the  Bonds  issued
hereunder or intended to be secured hereby.

     (d   The Trustee shall not be accountable for the use of any
Bonds  authenticated  or delivered hereunder.   The  Trustee  may
become  the  owner of Bonds secured hereby with the  same  rights
which  it would have if not the Trustee.  To the extent permitted
by law, the Trustee may also receive tenders and purchase in good
faith  Bonds from itself, including any department, affiliate  or
subsidiary, with like effect as if it were not the Trustee.

     (e    The  Trustee  shall be protected in  acting  upon  any
notice,  request, consent, certificate, order, affidavit, letter,
telegram or other paper or document believed by it to be  genuine
and  correct and to have been signed or sent by the proper person
or  persons.   Any action taken by the Trustee pursuant  to  this
Indenture upon the request or authority or consent of any  person
who  at  the time of making such request or giving such authority
or  consent  is  the owner of any Bond, shall be  conclusive  and
binding  upon all future owners of the same Bond and upon  owners
of Bonds issued in exchange therefor or in place thereof.

     (f    As to the existence or non-existence of any fact or as
to  the  sufficiency  or  validity of any  instrument,  paper  or
proceeding,  the  Trustee  shall  be  entitled  to  rely  upon  a
certificate  signed  by the Issuer or the Company  as  sufficient
evidence  of  the  facts  therein  contained  and  prior  to  the
occurrence of an event of default of which the Trustee  has  been
notified  as provided in subsection (h) of this Section 9.01,  or
of  which  by  said subsection it is deemed to have  notice,  the
Trustee  shall also be at liberty to accept a similar certificate
to  the effect that any particular dealing, transaction or action
is  necessary or expedient, but may at its discretion secure such
further evidence deemed necessary or advisable, but shall  in  no
case  be  bound  to secure the same.  The Trustee  may  accept  a
certificate  of  the Secretary of the Issuer under  the  Issuer's
seal  to  the  effect that a resolution in the form  therein  set
forth has been adopted by the Issuer as conclusive evidence  that
such  resolution has been duly adopted, and is in full force  and
effect.

     (g    The  permissive  right of the  Trustee  to  do  things
enumerated  in this Indenture shall not be construed as  a  duty,
and  it shall not be answerable for other than its negligence  or
willful default.

     (h    The Trustee shall not be required to take notice or be
deemed  to  have notice of any event of default hereunder  except
failure by the Issuer to cause to be made any of the payments  to
the  Trustee  required to be made by Article  IV  hereof  or  the
existence  of  an  event of default described in Section  8.01(c)
hereof,  unless  the  Trustee shall be specifically  notified  in
writing  of such event of default by the Issuer or by the holders
of  at  least  25% in aggregate principal amount  of  Bonds  then
Outstanding;  and  all notices or other instruments  required  by
this  Indenture to be delivered to the Trustee must, in order  to
be  effective,  be  delivered at the  principal  corporate  trust
office  of  the  Trustee, and in the absence of  such  notice  so
delivered the Trustee may conclusively assume there is  no  event
of default except as aforesaid.

     (i    At  any and all reasonable times the Trustee  and  its
duly    authorized   agents,   attorneys,   experts,   engineers,
accountants  and representatives shall have the  right  fully  to
inspect  any and all parts of the Project, including  all  books,
papers  and  records of the Issuer pertaining to the Project  and
the  Bonds and to take such memoranda from and in regard  thereto
as may be desired.

     (j    The Trustee shall not be required to give any bond  or
surety  in respect of the execution of the said trusts and powers
or otherwise in respect of the premises.

     (k    Notwithstanding anything elsewhere in  this  Indenture
contained,  the Trustee shall have the right, but  shall  not  be
required,  to  demand,  in respect of the authentication  of  any
Bonds,  the  withdrawal  of any cash, or  any  action  whatsoever
within the purview of this Indenture, any showings, certificates,
opinions, appraisals or other information, or corporate action or
evidence  thereof,  in  addition to  that  by  the  terms  hereof
required as a condition of such action by the Trustee, which  the
Trustee  in its discretion may deem desirable for the purpose  of
establishing the right of the Issuer to the authentication of any
Bonds,  the  withdrawal of any cash, or the taking of  any  other
action by the Trustee.

     (l    Before taking any action referred to in Sections 8.02,
8.03,  8.04,  8.10, 8.12 or 9.04 hereof, the Trustee may  require
that   a  satisfactory  indemnity  bond  be  furnished  for   the
reimbursement  of  all expenses to which it may  be  put  and  to
protect  it  against  all liability, except  liability  which  is
adjudicated  to  have  resulted from its  negligence  or  willful
default by reason of any action so taken.

     (m    All moneys received by the Trustee or any paying agent
shall,  until used or applied or invested 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  herein or by law.  Neither the Trustee nor  any  paying
agent  shall  be under any liability for interest on  any  moneys
received hereunder except such as may be mutually agreed upon.

     (n    No  provision  of  this Indenture  shall  require  the
Trustee  to expend or risk its own funds or otherwise  incur  any
financial  liability  in the performance of  any  of  its  duties
hereunder or in the exercise of any of its rights or powers.

     SECTION  9.02. Fees, Charges and Expenses of  Trustee.   The
Trustee  shall  be  entitled  to payment  and  reimbursement  for
reasonable  fees  for  its services rendered  hereunder  and  all
advances,   counsel  fees  and  other  expenses  reasonably   and
necessarily  made or incurred by the Trustee in  connection  with
such  services.  Upon an event of default, but only upon an event
of  default, the Trustee shall have a first lien, with  right  of
payment  prior  to  payment  on  account  of  principal  of   and
redemption  premium, if any, and interest on any Bond,  upon  the
trust  estate  for  the  foregoing  fees,  charges  and  expenses
incurred by it.

     SECTION  9.03.  Notice to Bondholders if an Event of Default
Occurs.  If an event of default occurs of which the Trustee is by
Section 9.01(h) hereof required to take notice or if notice of an
event  of  default is given as in Section 9.01(h) provided,  then
the  Trustee  shall  promptly  give  written  notice  thereof  by
registered  or  certified  mail  to  each  owner  of  Bonds  then
Outstanding.

     SECTION  9.04.   Intervention by Trustee.  In  any  judicial
proceeding  to  which  the Issuer is a party  and  which  in  the
opinion  of the Trustee and its counsel has a substantial bearing
on  the  interests of the owners of the Bonds,  the  Trustee  may
intervene  on  behalf  of the Bondholders  and  shall  do  so  if
requested  in  writing  by the owners of  at  least  25%  of  the
aggregate principal amount of Bonds then Outstanding.  The rights
and  obligations  of  the Trustee under  this  Section  9.04  are
subject to the approval of a court of competent jurisdiction.

     SECTION  9.05.   Successor  Trustee.   Any  corporation   or
association into which the Trustee may be converted or merged, or
with  which  it may be consolidated, or to which it may  sell  or
transfer   its  trust  business  and  assets  as   a   whole   or
substantially  as  a  whole  or any  corporation  or  association
resulting  from any such conversion, sale, merger,  consolidation
or  transfer  to which it is a party, ipso facto,  shall  be  and
become  successor Trustee hereunder and vested with  all  of  the
title   to   the  trust  estate  and  all  the  trusts,   powers,
discretions, immunities, privileges and all other matters as  was
its   predecessor,  without  the  execution  or  filing  of   any
instrument or any further act, deed or conveyance on the part  of
any  of  the  parties  hereto, anything herein  to  the  contrary
notwithstanding.

     SECTION 9.06.  Resignation by Trustee.  The Trustee and  any
successor  Trustee may at any time resign from the trusts  hereby
created  by giving thirty days' written notice to the Issuer  and
the Company, served personally or sent by registered or certified
mail,  and  to  each  owner of Bonds then  Outstanding,  sent  by
registered  or  certified mail, and such resignation  shall  take
effect at the end of such thirty days if a successor Trustee  has
been  appointed at such time pursuant to Section 9.08 hereof,  or
upon  the  later appointment of a successor Trustee  pursuant  to
Section 9.08 hereof.

     SECTION  9.07.  Removal  of Trustee.   The  Trustee  may  be
removed  at  any time, by an instrument or concurrent instruments
in writing delivered (a) to the Trustee and to the Issuer and the
Company,  and  signed  by the owners of a majority  in  aggregate
principal amount of Bonds then Outstanding, or (b) to the Trustee
and  the owners of all Bonds then Outstanding, and signed by  the
Issuer and the Company.

     SECTION 9.08. Appointment of Successor Trustee.  In case the
Trustee hereunder shall resign or be removed, or be dissolved, or
shall  be  in course of dissolution or liquidation, or  otherwise
become  incapable  of acting hereunder, or in case  it  shall  be
taken under the control of any public officer or officers, or  of
a  receiver appointed by a court, a successor shall be  appointed
by  the Issuer at the direction of the Company.  The Issuer shall
cause  notice of such appointment to be given in the same  manner
as  the  giving of notices of redemption as set forth in  Section
3.04  hereof.   If  the  Issuer fails to  make  such  appointment
promptly,  a  successor  may be appointed  by  the  owners  of  a
majority in aggregate principal amount of Bonds then Outstanding.
Every such successor Trustee appointed pursuant to the provisions
of  this  Section 9.08 shall be a trust company or bank  in  good
standing having a reported capital, surplus and undivided profits
of  not  less  than $50,000,000, if there be such an  institution
willing,  qualified and able to accept the trusts upon reasonable
and customary terms.

     SECTION  9.09.  Concerning  Any  Successor  Trustee.   Every
successor  Trustee appointed hereunder shall execute, acknowledge
and  deliver  to  its  predecessor and  also  to  the  Issuer  an
instrument  in writing accepting such appointment hereunder,  and
thereupon  such  successor, without  any  further  act,  deed  or
conveyance,  shall become fully vested with all of  the  estates,
properties, rights, powers, trusts, duties and obligations of its
predecessor;  but  such predecessor shall, nevertheless,  on  the
written  request of the Issuer, or of its successor, execute  and
deliver an instrument transferring to such successor Trustee  all
the  estates,  properties,  rights, powers  and  trusts  of  such
predecessor  hereunder,  and  every  predecessor  Trustee   shall
deliver all securities and moneys held by it as Trustee hereunder
to  its  successor.  Should any instrument in  writing  from  the
Issuer  be  required by any successor Trustee for more fully  and
certainly  vesting in such successor the estate,  rights,  powers
and  duties  hereby  vested  or intended  to  be  vested  in  the
predecessor,  any and all such instruments in writing  shall,  on
request,  be executed, acknowledged and delivered by the  Issuer.
The  resignation of any Trustee and the instrument or instruments
removing  any  Trustee  and  appointing  a  successor  hereunder,
together with all other instruments provided for in this  Article
IX,  shall  be filed and/or recorded by the successor Trustee  in
each  recording office where this Indenture shall have been filed
and/or  recorded and the successor Trustee shall  bear  the  cost
thereof.

     SECTION 9.10. Successor Trustee as Bond Registrar, Custodian
of  Bond  Fund  and Paying Agent.  In the event of  a  change  of
Trustee,  the  Trustee which has resigned or been  removed  shall
cease  to  be Bond Registrar, custodian of the Bond  Fund  and  a
paying agent for principal of and redemption premium, if any, and
interest  on  the Bonds, and the successor Trustee  shall  become
such  Bond  Registrar, custodian of the Bond Fund  and  a  paying
agent.

     SECTION   9.11.  Trustee  and  Issuer  Required  to   Accept
Directions  and Actions of Company.  Whenever, after a reasonable
request  by the Company, the Issuer shall fail, refuse or neglect
to give any direction to the Trustee or to require the Trustee to
take  any action which the Issuer is required to have the Trustee
take  pursuant  to  the  provisions  of  the  Agreement  or  this
Indenture, the Company as agent of the Issuer may give  any  such
direction to the Trustee or require the Trustee to take any  such
action,  and  the  Trustee  is hereby irrevocably  empowered  and
directed  to accept such direction from the Company as sufficient
for  all purposes of this Indenture.  The Company shall have  the
right as agent of the Issuer to cause the Trustee to comply  with
any of the Trustee's obligations under this Indenture to the same
extent that the Issuer is empowered so to do.

     Certain actions or failures to act by the Issuer under  this
Indenture may create or result in an event of default under  this
Indenture  and the Company, as agent of the Issuer,  may  to  the
extent  permitted by law perform any and all acts  or  take  such
action  as  may be necessary for and on behalf of the  Issuer  to
prevent  or  correct said event of default and the Trustee  shall
take or accept such performance by the Company as performance  by
the Issuer in such event.

     The  Issuer  hereby  makes,  constitutes  and  appoints  the
Company irrevocably as its agent to give all directions,  do  all
things  and  perform  all acts provided, and  to  the  extent  so
provided, by this Section 9.11.

     SECTION  9.12.   No Transfer of Notes Held by  the  Trustee.
Except  as  required  to  effect an  assignment  to  a  successor
Trustee,  the  Trustee  shall not sell, assign  or  transfer  the
Agreement  or  the Notes and the Trustee is authorized  to  enter
into an agreement with the Company to such effect.

     SECTION 9.13.  Insurance.  The Trustee shall have no duty or
responsibility  to  receive, retain or  review  any  policies  of
insurance in connection with the Project or the Plant.

                           ARTICLE X

                 INDENTURES SUPPLEMENTAL HERETO

     SECTION   10.01.   Supplemental  Indentures  Not   Requiring
Consent  of Bondholders.  The Issuer and the Trustee may, without
the  consent of, or notice to, any of the Bondholders, enter into
such  indenture or indentures supplemental to this  Indenture  as
shall  not  be inconsistent with the terms and provisions  hereof
for any one or more of the following purposes:

     (a    to  set  forth any or all of the matters in connection
with the issuance of Additional Bonds as provided in Section 2.10
hereof;

     (b    to  cure  any  ambiguity, defect or omission  in  this
Indenture,  or to otherwise amend this Indenture, in such  manner
as  shall  not in the opinion of the Trustee impair the  security
hereof or adversely affect the Bondholders;

     (c    to grant to or confer upon the Trustee for the benefit
of  the  Bondholders any additional rights, remedies,  powers  or
authorities  that may lawfully be granted or conferred  upon  the
Bondholders or the Trustee;

     (d    to  add  additional covenants of  the  Issuer,  or  to
surrender any right or power herein conferred upon the Issuer;

     (e    to  subject  to  this Indenture  additional  revenues,
properties or collateral;

     (f    to  modify, amend or supplement this Indenture or  any
indenture  supplemental hereto in such manner as  to  permit  the
qualification hereof and thereof under the Trust Indenture Act of
1939  or  any similar federal statute hereafter in effect  or  to
permit  the  qualification  of  the  Bonds  for  sale  under  the
securities  laws  of any of the states of the  United  States  of
America,  and, if they so determine, to add to this Indenture  or
any  indenture  supplemental hereto such other terms,  conditions
and provisions as may be permitted by said Trust Indenture Act of
1939 or similar federal statute;

     (g    to provide different authorized denominations for  the
Bonds;

     (h    to  provide for an uncertificated registration  system
for the Bonds;

     (i    to evidence the succession of a new Trustee hereunder;
and

     (j   to make such changes as may be necessary to comply with
the  provisions  of  the 1954 Code or the Code  relating  to  the
exclusion of interest on the Bonds from gross income thereunder.

     SECTION 10.02. Supplemental Indentures Requiring Consent  of
Bondholders.   Exclusive of supplemental  indentures  covered  by
Section  10.01  hereof  and subject to the terms  and  provisions
contained  in this Section 10.02, and not otherwise, the  holders
of  not less than 50% in aggregate principal amount of the  Bonds
then  Outstanding  shall  have the  right,  from  time  to  time,
anything   contained   in   this  Indenture   to   the   contrary
notwithstanding, to consent to and approve the execution  by  the
Issuer  and  the  Trustee of such other indenture  or  indentures
supplemental hereto as shall be deemed necessary and desirable by
the  Trustee  for  the purpose of modifying, altering,  amending,
adding  to or rescinding, in any particular, any of the terms  or
provisions  contained  in  this Indenture  or  in  any  indenture
supplemental  hereto;  provided, however, that  nothing  in  this
Section  10.02  contained  shall  permit,  or  be  construed   as
permitting  (a) a change in the maturity of the principal  of  or
the interest on any Bond issued hereunder, or (b) a reduction  in
the  principal amount of, or redemption premium on, any  Bond  or
Bonds  or  the  rate  or  rates of interest  thereon,  or  (c)  a
privilege or priority of any outstanding Bond or Bonds  over  any
other  outstanding  Bond  or Bonds, or (d)  a  reduction  in  the
aggregate  principal amount of the Bonds required for consent  to
such supplemental indenture, unless, in each case, holders of all
Bonds then Outstanding consent to such supplemental indenture.

     If at any time the Issuer shall request the Trustee to enter
into  any such supplemental indenture for any of the purposes  of
this  Section 10.02, the Trustee shall, upon being satisfactorily
indemnified  with  respect  to  expenses,  cause  notice  of  the
proposed execution of such supplemental indenture to be given  in
the  same  manner as the giving of notices of redemption  as  set
forth  in  Section  3.04 hereof.  Such notice shall  briefly  set
forth the nature of the proposed supplemental indenture and shall
state  that copies thereof are on file at the principal corporate
trust  office  of the Trustee for inspection by all  Bondholders.
If,  within  sixty  days  or  such  longer  period  as  shall  be
prescribed by the Issuer following the giving of such notice, the
holders of not less than 50% in aggregate principal amount of the
Bonds  Outstanding  at  the time of the  execution  of  any  such
supplemental  indenture shall have consented to and approved  the
execution thereof as herein provided, no holder of any Bond shall
have  any  right  to  object to any of the terms  and  provisions
contained therein, or the operation thereof, or in any manner  to
question the propriety of the execution thereof, or to enjoin  or
restrain  the Trustee or the Issuer from executing  the  same  or
from  taking any action pursuant to the provisions thereof.  Upon
the  execution  of  any such supplemental indenture  as  in  this
Section 10.02 permitted and provided, this Indenture shall be and
be  deemed to be modified and amended in accordance therewith and
without the necessity for notation on the Bonds then Outstanding.

     Anything   herein   to   the  contrary  notwithstanding,   a
supplemental  indenture under this Article X  which  affects  the
rights of the Company shall not become effective unless and until
the Company shall have consented to the execution and delivery of
such  supplemental indenture.  In this regard, the Trustee  shall
cause  notice of the proposed execution and delivery of any  such
supplemental  indenture  together with a  copy  of  the  proposed
supplemental  indenture to be mailed by certified  or  registered
mail to the Company at least fifteen days prior to the giving  of
notice  of  the proposed execution of such supplemental indenture
as provided in this Section 10.02. The Company shall be deemed to
have  consented  to  the  execution  and  delivery  of  any  such
supplemental indenture if the Trustee does not receive  a  letter
of  protest  or objection thereto signed by or on behalf  of  the
Company  on  or  before  4:30  P.M.,  Mississippi  time,  on  the
fifteenth  day after the Company's receipt of said notice  and  a
copy of the proposed supplemental indenture.

     SECTION  10.03.  Trustee Authorized to Join in  Supplements;
Reliance on Counsel.  The Trustee is authorized to join with  the
Issuer   in  the  execution  and  delivery  of  any  supplemental
indenture  permitted by this Article X and in so doing  shall  be
fully protected by an opinion of counsel, who may be counsel  for
the Issuer or the Company, that such supplemental indenture is so
permitted and has been duly authorized by the Issuer and that all
things  necessary  to  make it a valid and  binding  supplemental
indenture have been done.


                           ARTICLE XI

                AMENDMENT OF AGREEMENT AND NOTE

     SECTION 11.01.  Amendments, Etc., to Agreement Not Requiring
Consent  of  Bondholders.   The Issuer  and  the  Trustee  shall,
without  the consent of or notice to the Bondholders, consent  to
any  amendment, change or modification of the Agreement  and  the
Notes  which may be entered into pursuant to Section 2.10  hereof
or  in connection with (a) implementation of a requirement of the
Agreement  or  this Indenture, (b) the curing of an ambiguity  or
formal  defect or omission, (c) the substitution or  addition  of
facilities  to the Project or in connection with identifying  the
Project  more  precisely, or (d) any other change which,  in  the
judgment  of the Trustee, is not to the prejudice of the  Trustee
or  the  Bondholders; provided, however, that as a  condition  of
such  consent,  there  may be required an opinion  of  nationally
recognized counsel experienced on the subject of municipal  bonds
to  that  effect  and  to the effect that such  action  does  not
adversely  effect  the exclusion from gross  income  for  federal
income tax purposes of the interest paid on the Bonds.

     SECTION  11.02.   Amendments, Etc., to  Agreement  Requiring
Consent  of  Bondholders.  Except for the amendments, changes  or
modifications  as provided in Section 11.01 hereof,  neither  the
Issuer  nor  the  Trustee shall consent to any  other  amendment,
change or modification of the Agreement or the terms of the Notes
without  the giving of notice and the written approval or consent
of the holders of not less than 50% in aggregate principal amount
of  the  Bonds  then Outstanding given and procured  as  in  this
Section  11.02  provided.   If at any time  the  Issuer  and  the
Company  shall  request the consent of the Trustee  to  any  such
proposed  amendment, change or modification of the  Agreement  or
the   terms   of  the  Notes,  the  Trustee  shall,  upon   being
satisfactorily indemnified with respect to expenses, cause notice
of such proposed amendment, change or modification to be given in
the  same manner as provided by Section 10.02 hereof with respect
to  supplemental indentures.  Such notice shall briefly set forth
the nature of such proposed amendment, change or modification and
shall state that copies of the instrument embodying the same  are
on file with the Trustee for inspection by all Bondholders.

     SECTION  11.03.  Trustee Authorized to Join  in  Amendments;
Reliance on Counsel.  The Trustee is authorized to join with  the
Issuer  in  the execution and delivery of any amendment permitted
by this Article XI and in so doing shall be fully protected by an
opinion  of  counsel, who may be counsel for the  Issuer  or  the
Company,  that such amendment is so permitted and has  been  duly
authorized by the Issuer and that all things necessary to make it
a valid and binding agreement have been done.


                          ARTICLE XII

                         MISCELLANEOUS

     SECTION 12.01. Consents, Etc., of Bondholders.  Any consent,
request,  direction,  approval,  objection  or  other  instrument
required  by  this  Indenture to be signed and  executed  by  the
Bondholders  may  be  in  any number of  concurrent  writings  of
similar  tenor and may be signed or executed by such  Bondholders
in  person  or  by  agent  appointed in writing.   Proof  of  the
execution  of  any  such consent, request,  direction,  approval,
objection  or  other instrument or of the writing appointing  any
such  agent, if made in the following manner, shall be sufficient
for  any  of  the  purposes  of  this  Indenture,  and  shall  be
conclusive  in  favor of the Trustee with regard  to  any  action
taken by it under such request or other instrument, namely:

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

     SECTION 12.02. Limitation of Rights.  With the exception  of
rights herein expressly conferred, nothing expressed or mentioned
in  or  to  be  inferred from this Indenture, or  the  Bonds,  is
intended  or shall be construed to give to any person or  company
other  than  the Company, the parties hereto, and the holders  of
the Bonds, any legal or equitable right, remedy or claim under or
in  respect  of  this Indenture or any covenants, conditions  and
provisions  herein  contained.  This Indenture  and  all  of  the
covenants,  conditions and provisions hereof are intended  to  be
and  are  for the sole and exclusive benefit of the Company,  the
parties hereto and the holders of the Bonds as herein provided.

     SECTION  12.03.   Severability.  If any  provision  of  this
Indenture  shall be held or deemed to be or shall,  in  fact,  be
illegal, inoperative or unenforceable, the same shall not  affect
any  other provision or provisions herein contained or render the
same   invalid,  inoperative  or  unenforceable  to  any   extent
whatever.

     SECTION  12.04.   Notices.  Any notice, request,  complaint,
demand, communication or other paper shall be sufficiently  given
and  shall be deemed given when delivered or mailed by registered
or   certified  mail,  postage  prepaid,  or  sent  by  telegram,
addressed  as  follows: if to the Issuer, at 1306 Walter  Sillers
Building, 550 High Street, Jackson, Mississippi 39205, Attention:
Executive Director; if to the Trustee, at Tower Marc Plaza, 10161
Centurion   Parkway,  Jacksonville,  Florida  32256,   Attention:
Corporate  Trust Division; and if to the Company, at  639  Loyola
Avenue,  New  Orleans, Louisiana 70113, Attention: Treasurer.   A
duplicate  copy of each notice required to be given hereunder  by
either  the  Issuer or the Trustee shall also  be  given  to  the
Company, and a duplicate copy of each notice required to be given
hereunder  by  the Trustee to either the Issuer  or  the  Company
shall  also  be given to the other.  The Issuer, the Company  and
the Trustee may, by notice given hereunder, designate any further
or  different addresses to which subsequent notices, certificates
or other communications shall be sent.

     SECTION  12.05.  Trustee as Paying Agent and Bond Registrar.
The  Trustee is hereby designated and agrees to act as  a  paying
agent and Bond Registrar for and in respect of the Bonds.

     SECTION  12.06.   Payments  Due on  Saturdays,  Sundays  and
Holidays.  In any case where the date of maturity of interest  on
or principal of the Bonds or the date fixed for redemption of any
Bonds  shall be a Saturday, Sunday, or in the city of payment,  a
legal  holiday  or  a  day  on  which  banking  institutions  are
authorized by law to close, then payment of interest or principal
and redemption premium, if any, need not be made on such date but
may  be  made on the next succeeding business day with  the  same
force  and effect as if made on the date of maturity or the  date
fixed  for  redemption,  and no interest on  such  payment  shall
accrue for the period after such date.

     SECTION  12.07.   Counterparts.   This  Indenture   may   be
executed  in  several counterparts, each of  which  shall  be  an
original  and all of which shall constitute but one and the  same
instrument.

     SECTION   12.08.   Applicable  Provisions  of   Law.    This
Indenture  shall be governed by and construed in accordance  with
the laws of the State of Mississippi.

     SECTION 12.09.  Captions.  The captions or headings in  this
Indenture are for convenience only and in no way define, limit or
describe  the  scope or intent of any provisions or  Sections  of
this Indenture.

     SECTION  12.10.  No Liability of Officers.  No  covenant  or
agreement  contained  in  the Bonds or this  Indenture  shall  be
deemed  to  be  a  covenant or agreement of any member,  officer,
agent  or employee of the Issuer in his individual capacity,  and
neither  the members of the Board nor any official executing  the
Bonds  or this Indenture shall be liable personally on the  Bonds
or  be  subject  to  any personal liability or accountability  by
reason of the issuance of the Bonds or the execution and delivery
of this Indenture.

     IN   WITNESS  WHEREOF,  the  Mississippi  Business   Finance
Corporation  has caused these presents to be signed in  its  name
and behalf by its Executive Director, and its official seal to be
hereunto  affixed and attested by its Secretary, and to  evidence
its  acceptance of the trusts hereby created The Bank of New York
Trust  Company  of  Florida, N.A., as Trustee, has  caused  these
presents  to  be signed in its name and behalf and  its  official
seal  to  be hereunto affixed and attested by its duly authorized
officers, all as of the day and year first above written.

                                   MISSISSIPPI BUSINESS FINANCE
                                   CORPORATION

                                   By
                                        Executive Director
ATTEST:

                         
Secretary

<PAGE>
                                   THE  BANK  OF NEW  YORK  TRUST
                                   COMPANY OF FLORIDA, N.A.
[SEAL]
                                   By
                                   Title
ATTEST:

                         

Title


<PAGE>
STATE OF LOUISIANA

PARISH OF ORLEANS

     Personally appeared before me, the undersigned authority  in
and  for  the said parish and state, on this 3rd day of November,
1998,  within my jurisdiction, the within named William T.  Barry
and  James Vernon Smith, Sr., who acknowledged that they are  the
Executive  Director  and  Secretary of the  Mississippi  Business
Finance  Corporation, and that in said representative  capacities
they  executed  the above and foregoing instrument,  after  first
having been duly authorized so to do.

                                   
                                   Notary Public
My Commission Expires:



<PAGE>

STATE OF

COUNTY OF

     Personally appeared before me, the undersigned authority  in
and  for  the said county and state, on this     day of November,
1998,     within    my    jurisdiction,    the    within    named
                                                              and
                                              ,  who acknowledged
that  they are  a                                             and
                                      , respectively, of The Bank
of  New  York Trust Company of Florida, N.A., a national  banking
association, and that for and on behalf of the said bank  and  as
its   act   and  deed  they  executed  the  above  and  foregoing
instrument, after first having been duly authorized by said  bank
so to do.

                                   
                                   Notary Public
My Commission Expires: