EXHIBIT 4.16
            =========================================================





                        INTERVEST CORPORATION OF NEW YORK



                                       AND



                              THE BANK OF NEW YORK
                                   as Trustee




                                    INDENTURE

                         Dated as of September 15, 2000





                                   $3,750,000
                            Series 9/18/00 Debentures



                         $1,250,000 Due January 1, 2004
                         $1,250,000 Due January 1, 2006
                         $1,250,000 Due January 1, 2008








            =========================================================


<PAGE>


                              CROSS REFERENCE TABLE


TIA Section                                Indenture Section

310(a)(1) and (2)..........................7.10
310(a)(3) and (4)..........................N.A.
310(b).....................................7.08, 7.10, 11.02
310(c).....................................N.A.
311(a) and (b).............................7.11
311(c).....................................N.A.
312(a).....................................2.05
312(b) and (c).............................2.06
313(a).....................................7.06
313(b)(1)..................................N.A.
313(b)(2)..................................7.06
313(c).....................................7.06, 11.02
313(d).....................................7.06
314(a).....................................4.02, 11.02
314(b).....................................N.A.
314(c)(1) and (c)(2).......................11.03
314(c)(3) and (d)..........................N.A.
314(e).....................................11.04
314(f).....................................N.A.
315(a), (c) and (d)........................7.01
315(b).....................................7.05, 11.02
315(e).....................................6.11
316(a)(1)(A)...............................6.05
316(a)(1)(B)...............................6.04
316(a)(2)..................................9.02
316(a) Last Paragraph......................2.10, 11.05
316(b).....................................6.07
317(a).....................................6.08, 6.09
317(b).....................................2.04
318(a).....................................11.01



N.A. means Not Applicable.

Note:    This cross reference table shall not, for any purpose, be deemed to be
         a part of the Indenture.



<PAGE>


                                   ARTICLE ONE
                   DEFINITIONS AND INCORPORATION BY REFERENCE

1.01.  Definitions...............................................  1
       -----------

1.02.  Other Definitions.........................................  3
       -----------------

1.03.  Incorporation by Reference of Trust Indenture Act-........  3
       -------------------------------------------------

1.04.  Acts of Holders...........................................  3
       ---------------

1.05.  Rules of Construction.....................................  4
       ---------------------

                                   ARTICLE TWO
                                 THE DEBENTURES

2.01.  Form and Dating...........................................  5
       ---------------

2.02.  Execution and Authentication..............................  5
       ----------------------------

2.03.  Registrar and Paying Agent................................  6
       --------------------------

2.04.  Paying Agent to Hold Money in Trust.......................  6
       -----------------------------------

2.05.  Debentureholder Lists.....................................  6
       ---------------------

2.06.  Access of Information to Debentureholders. ...............  6
       -----------------------------------------

2.07.  Transfer and Exchange.....................................  7
       ---------------------

2.08.  Replacement Debentures....................................  8
       ----------------------

2.09.  Outstanding Debentures....................................  8
       ----------------------

2.10.  Treasury Debentures.......................................  8
       -------------------

2.11.  Temporary Debentures......................................  8
       --------------------

2.12.  Cancellation..............................................  9
       ------------

2.13.  Defaulted Interest........................................  9
       ------------------

2.14.  CUSIP Numbers.............................................  9
       -------------



<PAGE>


                                  ARTICLE THREE
                                   REDEMPTION

3.01.  Notices to Trustee........................................ 10
       ------------------

3.02.  Selection of Debentures to be Redeemed.................... 10
       --------------------------------------

3.03.  Notice of Redemption...................................... 10
       --------------------

3.04.  Effect of Notice of Redemption............................ 10
       ------------------------------

3.05.  Deposit of Redemption Price............................... 11
       ---------------------------

3.06.  Debentures Redeemed in Part............................... 11
       ---------------------------

3.07.  Repurchase at Option of Holder............................ 11
       ------------------------------

                                  ARTICLE FOUR
                                    COVENANTS

4.01.  Payment of Debentures..................................... 12
       ---------------------

4.02.  SEC Reports............................................... 12
       -----------

4.03.  Compliance Certificate.................................... 12
       ----------------------

4.04.  Limitation on Dividends and Stock Purchases............... 12
       -------------------------------------------

4.05.  Pari Passu and Other Indebtedness......................... 13
       ---------------------------------

                                  ARTICLE FIVE
                              SUCCESSOR CORPORATION

5.01.  When the Company May Merge, etc........................... 13
       -------------------------------

                                   ARTICLE SIX
                              DEFAULTS AND REMEDIES

6.01.  Events of Default......................................... 14
       -----------------

6.02.  Acceleration.............................................. 14
       ------------

6.03.  Other Remedies............................................ 15
       --------------

6.04.  Waiver of Past Defaults................................... 15
       -----------------------

<PAGE>

6.05.  Control by Majority....................................... 15
       -------------------

6.06.  Limitation of Suits....................................... 15
       -------------------

6.07.  Rights of Holders to Receive Payment...................... 16
       ------------------------------------

6.08.  Collection Suit by Trustee................................ 16
       --------------------------

6.09.  Trustee May File Proof of Claim........................... 16
       -------------------------------

6.10.  Priorities................................................ 17
       ----------

6.11.  Undertaking for Costs..................................... 17
       ---------------------

                                  ARTICLE SEVEN
                                     TRUSTEE

7.01.  Duties of Trustee......................................... 17
       -----------------

7.02.  Rights of Trustee......................................... 18
       -----------------

7.03.  Individual Rights of Trustee.............................. 18
       ----------------------------

7.04.  Trustee's Disclaimer...................................... 19
       --------------------

7.05.  Notice of Defaults........................................ 19
       ------------------

7.06.  Reports by Trustees to Holders............................ 19
       ------------------------------

7.07.  Compensation and Indemnity................................ 19
       --------------------------

7.08.  Replacement of Trustee.................................... 20
       ----------------------

7.09.  Successor Trustee by Merger, etc.......................... 21
       --------------------------------

7.10.  Eligibility; Disqualification............................. 21
       -----------------------------

7.11.  Preferential Collection of Claims Against the Company..... 21
       -----------------------------------------------------

7.12.  Paying Agents............................................. 21
       -------------
<PAGE>

                                  ARTICLE EIGHT
                             DISCHARGE OF INDENTURE

8.01.  Termination of the Company's Obligations.................. 22
       ----------------------------------------

8.02.  Application of Trust Money................................ 22
       --------------------------

8.03.  Repayment to the Company.................................. 23
       ------------------------

                                  ARTICLE NINE
                       AMENDMENTS, SUPPLEMENTS AND WAIVERS

9.01.  Without Consent of Holders................................ 23
       --------------------------

9.02.  With Consent of Holders................................... 23
       -----------------------

9.03.  Execution of Supplemental Indentures...................... 24
       ------------------------------------

9.04.  Compliance with Trust Indenture Act....................... 24
       -----------------------------------

9.05.  Revocation and Effect of Consents......................... 24
       ---------------------------------

9.06.  Notation on or Exchange of Debentures..................... 25
       -------------------------------------

9.07.  Trustee to Sign Amendments, etc........................... 25
       -------------------------------

                                   ARTICLE TEN
                                  SUBORDINATION

10.01.  Agreement to Subordinate................................. 26
        ------------------------

10.02.  Debentures  Subordinated to Prior Payment of All
        Senior Indebtedness on Dissolution, Liquidation or
        Reorganization of the Company............................ 26
        -----------------------------

10.03.  Debentureholders to be Subrogated to Rights of Holders
        of Senior Indebtedness................................... 27
        ----------------------

10.04.  Obligation of the Company Unconditional.................. 27
        ---------------------------------------

10.05.  Knowledge of Trustee..................................... 28
        --------------------

10.06.  Application by Trustee of Monies Deposited With It....... 28
        --------------------------------------------------

10.07.  Subordination Rights Not Impaired by Acts or Omissions
        of the Company or Holders of Senior Indebtedness......... 28
        ------------------------------------------------

10.08.  Debentureholders Authorize Trustee to Effectuate
        Subordination of Debentures.............................. 29
        ---------------------------

10.09.  Right of Trustee to Hold Senior Indebtedness............. 29
        --------------------------------------------
<PAGE>


10.10.  Article Ten Not to Prevent Events of Default............. 29
        --------------------------------------------

10.11.  No Fiduciary Duty Created to Holders of
        Senior Indebtedness...................................... 29
        -------------------

10.12.  Trustee's Compensation Not Prejudiced.................... 29
        -------------------------------------

                                 ARTICLE ELEVEN
                                  MISCELLANEOUS

11.01.  Trust Indenture Act Controls............................. 30
        ----------------------------

11.02.  Notices.................................................. 30
        -------

11.03.  Certificate and Opinion as to Conditions Precedent....... 30
        --------------------------------------------------

11.04.  Statements Required in Certificate or Opinion............ 31
        ---------------------------------------------

11.05.  Rules by Trustee and Agents.............................. 31
        ---------------------------

11.06.  Legal Holidays........................................... 31
        --------------

11.07.  Governing Law............................................ 31
        -------------

11.08.  No Recourse Against Others............................... 31
        --------------------------

11.09.  Successors............................................... 31
        ----------

11.10.  Duplicate Originals...................................... 31
        -------------------

11.11.  Separability............................................. 31
        ------------



<PAGE>


         INDENTURE,   dated  as  of  September  15,  2000,   between   INTERVEST
CORPORATION OF NEW YORK, a New York corporation (the "Company"), and THE BANK OF
NEW YORK, a New York banking corporation, as trustee (the "Trustee").

         Intending to be legally bound hereby,  each party agrees as follows for
the  benefit  of the other  party and for the equal and  ratable  benefit of the
Holders of the Company's Series 9/18/00 Debentures.

                                   ARTICLE ONE

                   DEFINITIONS AND INCORPORATION BY REFERENCE
                   ------------------------------------------

         SECTION 1.01.  Definitions.
                        -----------

         "Affiliate"  means any person  directly or  indirectly  controlling  or
controlled by or under direct or indirect common control with the Company or any
Subsidiary. For purposes of this definition, "control" when used with respect to
any person means the power to direct the management and policies of such person,
directly or indirectly,  whether through the ownership of voting securities,  by
contract  or  otherwise;  and the  terms  "controlling"  and  "controlled"  have
meanings correlative to the foregoing.

         "Agent" means any Registrar, Paying Agent or co-Registrar.

         "Board of Directors" means the Board of Directors of the Company or any
committee of that Board duly authorized to act for it hereunder.

         "Business Day" means a day that is not a Legal Holiday.

         "Capital  Stock" means any and all shares,  interests,  participations,
rights or other equivalents (however designated) of corporate stock.

         "Company"  means  the  party  named as such in this  Indenture  until a
successor  replaces  it  pursuant  to  the  applicable   provisions  hereof  and
thereafter means any such successor.

         "Debentures"  means: the Series 9/18/00  Debentures,  issued under this
Indenture, in three maturities as follows:  January 1, 2004, January 1, 2006 and
January 1, 2008:  as amended or  supplemented  from time to time pursuant to the
terms of this Indenture; "Debenture" means any one of such Debentures.

         "Default"  means any event which is, or after notice or passage of time
or both would be, an Event of Default.

         "Holder"  or  "Debentureholder"  means  the  person  in  whose  name  a
Debenture is registered on the Registrar's books.



<PAGE>




         "Indebtedness"   means,   with  respect  to  any  person:   (i)(A)  all
indebtedness  of such person for borrowed  money,  (B) all  indebtedness of such
person which is evidenced by a note, debenture, bond or other similar instrument
(including  capitalized  lease  and  purchase  money  obligations),  and (C) all
indebtedness  (including  capitalized lease  obligations)  incurred,  assumed or
given in the  acquisition  (whether by way of purchase,  merger or otherwise) of
any  business,  real  property or other assets  (except  assets  acquired in the
ordinary  course of the acquiror's  business);  (ii) any  indebtedness of others
described in the  preceding  clause (i) which such person has  guaranteed or for
which it is otherwise  liable;  and (iii) any amendment,  renewal,  extension or
refunding of any indebtedness referred to in clauses (i) and (ii) above.

         "Indenture"  means this instrument as originally  executed or as it may
from  time  to  time  be  supplemented  or  amended  by one or  more  indentures
supplemental hereto entered into pursuant to the applicable provisions hereof.

         "Maturity"  means either of the two  maturities  of  Debentures  issued
under this Indenture.

         "Officer"  means the  Chairman or  co-Chairman  of the Board,  the Vice
Chairman of the Board, the President,  any Vice President,  the Treasurer or the
Secretary of the Company.

         "Officers'  Certificate"  means a certificate signed by two Officers or
by an Officer  and an  Assistant  Treasurer  or an  Assistant  Secretary  of the
Company.

         "Opinion of Counsel" means a written opinion from legal counsel who may
be counsel for the Company or other counsel who is acceptable to the Trustee.

         "person" means any individual, corporation, partnership, joint venture,
association,   joint-stock  company,  trust,   unincorporated   organization  or
government or other agency or political subdivision thereof.

         "principal" of a debt security means the principal of the security plus
the premium, if any, on the security.

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

         "SEC" means the Securities and Exchange Commission.

         "Subsidiary"  means a corporation,  a majority of whose voting stock is
owned by the  Company or a  Subsidiary.  Voting  stock is Capital  Stock  having
voting power under ordinary circumstances to elect directors.

         "TIA"  means  the  Trust  Indenture  Act of 1939 (15 U.S.  Code  ss.ss.
77aaa-77bbbb)  as in effect on the date this  Indenture was executed,  except as
provided in Section 9.04.


                                       2
<PAGE>



         "Trustee"  means  the  party  named as such in this  Indenture  until a
successor replaces it and thereafter means the successor.

         "United States" means the United State of America.

         SECTION 1.02.  Other Definitions.
                        -----------------

  Term                                                 Defined in Section
  ----                                                 ------------------
  "Bankruptcy Law"                                      6.01
  "Custodian"                                                    6.01
  "Event of Default"                                             6.01
  "Legal Holiday"                                      11.06
  "Paying Agent"                                        2.03
  "Registrar"                                                    2.03
  "Restricted Payments"                                 4.04
  "Senior Indebtedness"                                10.01
  "U.S. Government Obligations"                         8.01

         SECTION  1.03.  Incorporation  by  Reference  of Trust  Indenture  Act.
                         -------------------------------------------------------
Whenever  this  Indenture  refers to a provision  of the TIA,  the  provision is
incorporated  by reference in and made a part of this  Indenture.  The following
TIA terms used in this Indenture have the following meanings:

         "Commission" means the SEC.

         "indenture securities" means the Debentures.

         "indenture security holder" means a Debentureholder.

         "indenture to be qualified" means this Indenture.

         "indenture trustee" or "institutional trustee" means the Trustee.

         "obligor" on the indenture securities means the Company or any other
          obligor on the Debentures.

         All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA  reference  to  another  statute or defined by SEC rules have the
meanings assigned to them.


         SECTION  1.04. Acts of Holders. (a) Any request, demand, authorization,
                        ----------------
direction, notice, consent, waiver or other action provided by this Indenture to
be given or taken by Holders  may be embodied  in and  evidenced  by one or more
instruments of  substantially  similar tenor signed by such Holders in person or
by agent duly appointed in writing;  and, except as herein  otherwise  expressly
provided, such action shall become effective when such instrument or instruments
are delivered to

                                       3
<PAGE>


the Trustee and, where it is hereby expressly required,  to  the  Company.  Such
instrument  or  instruments  (and  the  action  embodied  therein  and evidenced
thereby)  are  herein  sometimes  referred  to  as  the "Act" of Holders signing
such instrument or instruments. Proof of  xecution of any  such instrument or of
a writing appointing any such agent shall be sufficient for any purpose  of this
Indenture  and  conclusive  in  favor of the  Trustee  and  the Company, if made
in the manner provided in this Section.

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

         (c)  The ownership of Debentures shall be proved by the registration of
the books of the Registrar.

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

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


         SECTION  1.05.  Rules of  Construction.  Unless the  context  otherwise
                         ----------------------
requires: (i) a term has the meaning assigned to it; (ii) an accounting term not
otherwise  defined has the meaning  assigned to it in accordance  with generally
accepted accounting principles;  (iii) "or" is not exclusive;  and (iv) words in
the singular include the plural, and words in the plural include the singular.

                                       4
<PAGE>

                                   ARTICLE TWO

                                 THE DEBENTURES
                                 --------------
         SECTION  2.01.  Form  and  Dating.  The  Debentures  and the  Trustee's
                         -----------------
certificate of  authentication  shall be substantially in the forms set forth in
Exhibits A, B and C which are incorporated in and form a part of this Indenture.
The  Debentures may have  notations,  legends or  endorsements  required by law,
securities  exchange  rule or usage.  The Company  shall approve the form of the
Debentures  and any notation,  legend or  endorsement  on them and its execution
shall constitute  conclusive  evidence of its approval.  Each Debenture shall be
dated the date of its authentication.  The terms and provisions contained in the
forms of Debenture annexed hereto as Exhibits A, B and C shall  constitute,  and
are hereby expressly made, a part of this Indenture.

         SECTION  2.02.  Execution  and  Authentication.
                         ------------------------------
Two Officers shall execute the Debentures for the Company by manual or facsimile
signature.  The Company's seal shall be affixed or reproduced on the Debentures.

         If an Officer  whose  signature  is on a Debenture no longer holds that
office at the time the Registrar,  as  hereinafter  defined,  authenticates  the
Debenture, the Debenture shall be valid nevertheless.

         A Debenture  shall not be valid until the Registrar  manually signs the
certificate  of  authentication  on  the  Debenture.   The  signature  shall  be
conclusive  evidence  that the  Debenture  has  been  authenticated  under  this
Indenture.

         The Registrar shall  authenticate  Debentures for original issue in the
aggregate principal amount of up to $3,750,000 (but not more than: $1,250,000 of
Debentures  maturing January 1, 2004;  $1,250,000 of Debentures maturing January
1, 2006; or $1,250,000  of Debentures  maturing  January 1, 2008) upon a written
order of the Company  signed by two  Officers or by an Officer and an  Assistant
Treasurer  of the  Company.  The order shall  specify the amount and Maturity of
Debentures to be  authenticated,  whether interest on the Debentures will accrue
or  will  be paid  quarterly,  and the  date on  which  the  original  issue  of
Debentures is to be authenticated.  The aggregate principal amount of Debentures
outstanding  at any time may not exceed the  amount  set forth  above  except as
provided in Sections 2.08 and 2.09.

         The Registrar  may appoint an  authenticating  agent  acceptable to the
Company  to  authenticate  Debentures.  Unless  limited  by the  terms  of  said
appointment,  an authenticating  agent may authenticate  Debentures whenever the
Registrar may do so. Each reference in this Indenture to  authentication  by the
Registrar   includes   authentication   by   such   authenticating   agent.   An
authenticating agent has the same rights as an Agent to deal with the Company or
an Affiliate.

         The  Debentures  shall be  issuable  only in  registered  form  without
coupons and only in denominations of $10,000 and any integral multiple thereof.

                                       5
<PAGE>

         SECTION 2.03. Registrar and Paying Agent. The Company shall maintain an
                       --------------------------
office or agency where  Debentures may be presented for registration of transfer
or for exchange  ("Registrar")  and an office or agency where  Debentures may be
presented for payment ("Paying  Agent").  The Registrar shall keep a register of
the Debentures  and of their transfer and exchange.  The Company may have one or
more  co-Registrars and one or more additional  Paying Agents.  The term "Paying
Agent"  includes  any  additional  paying  agent.  The  Company  or  any  of its
Subsidiaries may act as Paying Agent, Registrar or co-Registrar.

         The Company shall enter into an appropriate  agency  agreement with any
Agent  not a  party  to  this  Indenture.  The  agreement  shall  implement  the
provisions of this Indenture that relate to such Agent and shall incorporate the
provisions  of the TIA.  The  Company  shall  notify the Trustee of the name and
address of any such  Agent.  If the Company  fails to  maintain a  Registrar  or
Paying Agent, upon notification and delivery of necessary  records,  the Trustee
shall  act as  such  and  shall  be  entitled  to  appropriate  compensation  in
accordance with the provisions of Section 7.07.

         The Company initially appoints THE BANK OF NEW YORK, a New York banking
corporation, as Registrar and the Company shall act as Paying Agent.

         SECTION  2.04.  Paying Agent to Hold Money in Trust.  The Company shall
                         -----------------------------------
require  each Paying  Agent to agree in writing to hold in trust for the benefit
of the  Debentureholders  or the Trustee all money held by the Paying  Agent for
the payment of principal of or interest on the  Debentures,  and the Company and
the Paying  Agent shall each notify the Trustee of any default by the Company in
making any such  payment.  While any such  default  continues,  the  Trustee may
require  a  Paying  Agent to pay all  money  held by it to the  Trustee.  If the
Company or a Subsidiary  acts as Paying Agent,  it shall segregate the money and
hold it as a separate  trust fund.  The Company at any time may require a Paying
Agent to pay all  money  held by it to the  Trustee.  Upon such  payment  to the
Trustee the Paying Agent shall have no further liability for the money delivered
to the Trustee.

         SECTION 2.05.  Debentureholder  Lists. The Trustee shall preserve in as
                        ----------------------
current a form as is reasonably practicable the most recent list available to it
of the  names and  addresses  of  Debentureholders.  If the  Trustee  is not the
Registrar,  the Company  shall  furnish to the Trustee at least every six months
and at such other times as the Trustee may request in writing,  a list,  in such
form and as of such date as the Trustee may reasonably require, of the names and
addresses of Debentureholders.

         SECTION 2.06.  Access of Information to  Debentureholders.  Within five
                        ------------------------------------------
business days after the receipt by the Trustee of a written  application  by any
three or more Debentureholders stating that the applicants desire to communicate
with other  Debentureholders with respect to their rights under the Indenture or
under the Debentures,  and accompanied by a form of proxy or other communication
which such applicants  proposed to transmit,  and by reasonable  proof that each
such  applicant  has  owned a  Debenture  for a period  of at least  six  months
preceding  the date of such  application,  the Trustee  shall,  at its election,
either:

                                       6
<PAGE>

                  (a) afford  to  such  applicants  access to all information in
the   possession   of  the   Trustee  as  to  the  names and  addresses  of  the
Debentureholders; or

                  (b) inform such  applicants  as to the  approximate  number of
Debentureholders  according  to the most  recent  information  so  furnished  or
received  by the  Trustee,  and as to the  approximate  cost of  mailing to such
Debentureholders the form of proxy or other communication,  if any, specified in
such application.

         If the Trustee shall elect not to afford such applicants access to such
information,  the Trustee shall,  upon the written  request of such  applicants,
mail  to all  the  Debentureholders  copies  of  the  form  of  proxy  or  other
communication  which is  specified in the request,  with  reasonable  promptness
after a tender to the Trustee of the  material  to be mailed and of payment,  or
provision for the payment,  of the reasonable  expenses of such mailing,  unless
within five days after such tender,  the Trustee shall mail to such  applicants,
and file with the SEC  together  with a copy of the  material  to be  mailed,  a
written  statement  to the effect  that,  in the  opinion of the  Trustee,  such
mailing would be contrary to the best interests of the Debentureholders or would
be in violation of  applicable  law.  Such written  statement  shall specify the
basis of such opinion.

         The Company,  the Trustee, the Registrar and anyone else shall have the
protection of TIA ss.312.

         SECTION 2.07.  Transfer and Exchange.
                        ---------------------

         (a) The Debentures have not been registered under the Securities Act of
1933, as amended (the "Act") or under any  applicable  state  securities law and
may  not be  transferred,  sold  or  otherwise  disposed  of in the  absence  of
effective  registration  under  the  Act or an  opinion  of  counsel  reasonably
satisfactory to the Company that such registration is not required under the Act
and the rules and regulations  promulgated  thereunder or such state  securities
law. The  Debentures may contain a legend  setting forth these  restrictions  on
transfer.

         (b) Where a Debenture is presented to the  Registrar or a  co-Registrar
with a request to register a transfer, the Registrar shall register the transfer
as requested if its  requirements for such transaction are met. Where Debentures
of one Maturity are presented to the Registrar or a co-Registrar  with a request
to  exchange  them  for  an  equal  principal  amount  of  Debentures  of  other
denominations  of the same  Maturity,  the Registrar  shall make the exchange as
requested  if  its  requirements  for  such  transaction  are  met.   Debentures
containing  a  particular  CUSIP  Number  may not be  exchanged  for  Debentures
containing  another  CUSIP  Number.  To permit  transfers  and  exchanges,  upon
surrender of any Debenture for  registration of transfer at the office or agency
maintained pursuant to Section 2.03, the Company shall execute and the Registrar
shall  authenticate  Debentures  to be issued upon  transfer or exchange.  If so
requested by the Registrar, all Debentures presented for exchange,  registration
of transfer,  redemption or payment shall be accompanied by a written instrument
of  transfer  in  form  satisfactory  to the  Registrar,  duly  executed  by the
registered owner or by his attorney duly authorized in writing.  Any exchange or
transfer shall be without charge to the Debentureholder, except that the Company
may require  payment from the  Debentureholder  of a sum sufficient to cover any

                                       7
<PAGE>

tax or other  governmental  charge that may be imposed in relation thereto.  The
Registrar shall not transfer or exchange any Debenture or portion of a Debenture
selected for redemption,  or transfer or exchange any Debentures for a period of
15 days before a selection of Debentures to be redeemed.

         SECTION  2.08.  Replacement  Debentures.  If a mutilated  Debenture  is
                         -----------------------
surrendered  to the  Registrar  or if the Holder of a Debenture  claims that the
Debenture has been lost,  destroyed or wrongfully taken, the Company shall issue
and the Registrar shall authenticate a replacement Debenture if the requirements
of the Company or the Registrar for such  transaction are met. The Registrar may
require an  indemnity  bond which  shall be  sufficient  in the  judgment of the
Registrar and the Company to protect the Company,  the Trustee,  the  Registrar,
any Agent or any authenticating agent from any loss which any of them may suffer
if a Debenture is replaced, destroyed, lost or wrongfully taken. The Company may
charge  such  Holder  for  its  expenses  in  replacing  such  Debenture.  Every
replacement Debenture is an additional obligation of the Company.

         SECTION 2.09.  Outstanding  Debentures.  Debentures  outstanding at any
                        -----------------------
time are all Debentures authenticated by the Registrar except for those canceled
by it,  those  delivered  to it for  cancellation,  and those  described in this
Section 2.09. A Debenture does not cease to be  outstanding  because the Company
or one of its Subsidiaries holds the Debenture.

         If a Debenture is replaced  pursuant to Section  2.08,  it ceases to be
outstanding  unless the Trustee or the Registrar  receives proof satisfactory to
it that the replaced Debenture is held by a bona fide purchaser.

         If the Paying Agent (other than the Company or a Subsidiary) holds on a
redemption date or maturity date money  sufficient to pay Debentures  payable on
that date, then on and after that date such Debentures  shall be deemed to be no
longer outstanding and interest on them shall cease to accrue.

         SECTION 2.10. Treasury  Debentures.  In determining whether the Holders
                       --------------------
of the required amount of Debentures have concurred in any direction,  waiver or
consent,  and for the purpose of calculating and making payments of interest and
selecting  Debentures  for  redemption,  Debentures  owned by the  Company or an
Affiliate  shall be  disregarded,  except that for the  purposes of  determining
whether the Trustee  shall be protected in relying on any  direction,  waiver or
consent,  only  Debentures  the Trustee  actually knows are so owned shall be so
disregarded.

         SECTION 2.11.  Temporary  Debentures.  Until definitive  Debentures are
                        ---------------------
ready for delivery,  the Company may prepare and the Trustee shall  authenticate
temporary Debentures. Temporary Debentures shall be substantially in the form of
definitive  Debentures  but may  have  variations  that  the  Company  considers
appropriate for temporary  Debentures.  Without  unreasonable delay, the Company
shall  prepare and the  Trustee  shall  authenticate  definitive  Debentures  in
exchange for temporary  Debentures.  Until such exchange,  temporary  Debentures
shall be entitled to the same rights,  benefits  and  privileges  as  definitive
Debentures.

                                       8
<PAGE>

         SECTION  2.12.  Cancellation.  The  Company  at any  time  may  deliver
                         ------------
Debentures to the Trustee or the Registrar for  cancellation.  The Registrar and
Paying Agent shall forward to the Trustee any Debentures surrendered to them for
transfer,  exchange or payment.  The  Trustee or the  Registrar  and no one else
shall cancel and may destroy any Debentures surrendered for transfer,  exchange,
payment or cancellation and deliver a certificate of any such destruction to the
Company unless the Company  instructs the Trustee or the Registrar in writing to
deliver the Debentures to the Company.  The Company may not issue new Debentures
to replace,  or reissue or recall Debentures that it has (i) paid or redeemed or
(ii)  purchased  or  otherwise  acquired  and  delivered  to the  Trustee or the
Registrar for cancellation.

         SECTION 2.13. Defaulted Interest.  If the Company defaults in a payment
                       ------------------
of  interest  on the  Debentures,  it shall pay the  defaulted  interest  to the
persons who are  Debentureholders  on a  subsequent  special  record  date.  The
Company shall fix the special  payment date and special record date. The special
record  date shall be at least 15 days prior to the  special  payment  date.  At
least 15 days before such special  record date,  the Company  shall mail to each
Debentureholder  a notice that  states such  special  record  date,  the special
payment  date and the amount of defaulted  interest to be paid.  The Company may
pay defaulted interest in any other lawful manner. Pursuant to Section 4.01, the
Company shall pay interest on overdue  installments  of interest,  to the extent
lawful.

         SECTION 2.14. CUSIP Numbers.  The Company in issuing the Debentures may
                       -------------
use "CUSIP"  numbers (if then  generally in use),  and, if so, the Trustee shall
use  "CUSIP"  numbers in notices of  redemption  as a  convenience  to  Holders;
provided that any such notice may state that no representation is made as to the
--------
correctness  of such numbers either as printed on the Debentures or as contained
in any notice of a redemption  and that reliance may be placed only on the other
identification numbers printed on the Debentures,  and any such redemption shall
not be affected by any defect in or omission of such numbers.


                                       9
<PAGE>


                                  ARTICLE THREE

                                   REDEMPTION
                                   ----------

         SECTION 3.01. Notices to Trustee. The Debentures may be redeemed at any
                       ------------------
time in whole or in part, at the  redemption  price(s) set forth in section 5 of
the  Debentures.  The  Registrar  may  select  for  redemption  portions  of the
principal  amount of  Debentures  that have  denominations  larger than $10,000.
Debentures  and  portions  of them it selects  shall be in amounts of $10,000 or
integral multiples of $10,000.  If the Company elects to redeem  Debentures,  it
shall notify the Registrar in writing of the  redemption  date,  the Maturity or
Maturities  to be  redeemed,  and  the  principal  amount  of each  Maturity  of
Debentures to be redeemed. In the case of any such redemption, the Company shall
deliver to the Trustee an Officers'  Certificate  stating  that such  redemption
will comply  with the  provisions  for  redemption  contained  herein and in the
Debentures.

         The Company shall give each notice provided for in this Section 3.01 at
least 30 days before the  redemption  date  (except  that the Trustee may in its
sole discretion waive such notice period at any time).

         SECTION 3.02. Selection of Debentures to be Redeemed.  If less than all
                       --------------------------------------
the  Debentures of any Maturity are to be redeemed,  the Registrar  shall select
the  Debentures to be redeemed by such method as the  Registrar  shall deem fair
and  appropriate  or if the  Debentures  are  listed  on a  national  securities
exchange,  in accordance  with the rules of such exchange.  The Registrar  shall
make the selection from  Debentures  outstanding  and not previously  called for
redemption.  Provisions of this  Indenture  that apply to Debentures  called for
redemption also apply to portions of Debentures called for redemption.

         SECTION 3.03. Notice of Redemption.  At least 30 days but not more than
                       --------------------
90 days before a redemption  date, the Company shall mail a notice of redemption
by  first-class  mail to each Holder of  Debentures  to be redeemed.  The notice
shall identify the Debentures to be redeemed and shall state: (i) the redemption
date; (ii) the redemption price and accrued interest, if any; (iii) the name and
address of the Paying Agent;  (iv) that Debentures called for redemption must be
surrendered  to the Paying  Agent to collect  the  redemption  price and accrued
interest, if any; (v) that, unless the Company defaults in making the redemption
payments,  interest on Debentures  called for redemption ceases to accrue on and
after the  redemption  date and the only  remaining  right of the  Holders is to
receive  payment of the  redemption  price upon surrender to the Paying Agent of
the Debentures;  (vi) if any Debenture is being redeemed in part, the portion of
the  principal  amount  of such  Debenture  to be  redeemed  and (vii) the CUSIP
number, if any. At the Company's request and expense, the Trustee shall give the
notice of redemption in the Company's name.

         SECTION  3.04.  Effect  of  Notice  of  Redemption.  Once a  notice  of
                         ----------------------------------
redemption is mailed, Debentures called for redemption become due and payable on
the redemption  date and at the redemption  price.  Upon surrender to the Paying
Agent,  such  Debentures  shall be paid at the  redemption  price,  plus accrued
interest  to the  redemption  date,  but  interest  installments  for  which the

                                       10
<PAGE>

interest  payment date is on or prior to such redemption date will be payable to
the  Holders of record at the close of  business on the  relevant  record  dates
referred to in the Debentures.

         SECTION 3.05.  Deposit of Redemption  Price.  At least one Business Day
                        ----------------------------
prior to the  redemption  date,  the Company shall deposit with the Paying Agent
(or if the Company is its own Paying Agent,  shall  segregate and hold in trust)
immediately  available  funds  sufficient  to pay the  redemption  price of, and
accrued interest on, all Debentures to be redeemed on that date.

         SECTION  3.06.  Debentures  Redeemed  in  Part.  Upon  surrender  of  a
                         ------------------------------
Debenture that is redeemed in part,  the Registrar  shall  authenticate  for the
Holder,  at the expense of the Company,  a new  Debenture  of the same  Maturity
equal  in  principal   amount  to  the  unredeemed   portion  of  the  Debenture
surrendered.

         SECTION  3.07.  Repurchase  at Option of  Holder.  Subject  to and upon
                         --------------------------------
compliance  with the  provisions  of this  Section,  at the option of the Holder
thereof,  the Company will  repurchase  Debentures  at a price equal to the face
amount of the Debenture,  together with all accrued interest thereon to the date
of  repurchase.  Such right shall  commence  in calendar  year 2004 and shall be
subject  to the  limitation  that,  in no  calendar  year  shall the  Company be
required to purchase  more than  $100,000  principal  amount of each maturity of
Debentures,  on a non-cumulative basis. Such repurchases shall be made only once
each  calendar  year,  on January 1 of each year  commencing  in 2004.  A Holder
desiring the Company to purchase a Debenture  must deliver a written  request to
the Company, together with the Debenture and a written instrument of transfer in
form  satisfactory  to the  Company  and the  Registrar,  duly  executed  by the
registered owner or by his attorney duly authorized in writing.  The request may
be made only once each year,  commencing in 2003,  and the Company will purchase
Debentures  presented by Holders on a first-come,  first-served  basis, based on
the date the Company receives the completed documents. The request and completed
documents  must be  delivered  no  earlier  than  November  1 and no later  than
November  30 for a purchase  to be  completed  as of January 1 of the next year.
Only whole  Debentures,  as evidenced  by the  certificate  surrendered,  may be
surrendered  for  repurchase  and the  Company  may  suspend  or  terminate  its
obligation  to  repurchase  Debentures  pursuant to this Section 3.07 if: (i) it
determines, in its sole discretion,  that circumstances make such repurchase not
reasonably  practical;  (ii) it determines,  in its sole  discretion,  that such
repurchase would cause adverse tax consequences to the Company or the Holders of
Debentures;  (iii) any governmental or regulatory  agency with jurisdiction over
the Company so demands for the protection of the Holders of Debentures;  or (iv)
it determines, in its sole discretion, that such repurchase would be unlawful.

                                       11
<PAGE>

                                  ARTICLE FOUR

                                    COVENANTS
                                    ---------

         SECTION  4.01.  Payment  of  Debentures.  The  Company  shall  pay  the
                         -----------------------
principal  of and  interest  on the  Debentures  on the dates and in the  manner
provided in the  Debentures.  An  installment  of principal or interest shall be
considered paid on the date due if the Paying Agent (other than the Company or a
Subsidiary)  holds on that date money  designated  for and sufficient to pay the
installment.  The  Company  shall  deposit  with the  Paying  Agent  immediately
available funds sufficient to pay the principal of or interest on the Debentures
at least one Business Day prior to the dates provided in the Debentures.

         The Company  shall pay  interest on overdue  principal  and interest on
overdue  installments of interest,  to the extent lawful,  at the rate per annum
borne by the Debentures.

         SECTION 4.02.  SEC Reports.  Within 5 days after the Company files with
                        -----------
the SEC  copies of its  annual  reports  and other  information,  documents  and
reports (or copies of such  portions of any of the  foregoing  as the SEC may by
rules  and  regulations  prescribe)  which it is  required  to file with the SEC
pursuant  to Section 13 or 15(d) of the  Securities  Exchange  Act of 1934,  the
Company shall file the same with the Trustee. The Company also shall comply with
the other provisions of TIA ss. 314(a).

         SECTION 4.03. Compliance Certificate.  The Company shall deliver to the
                       ----------------------
Trustee  within 120 days  after the end of each  fiscal  year of the  Company an
Officers' Certificate stating that a review of the activities of the Company has
been  made  under  the  supervision  of the  signing  Officers  with  a view  to
determining  whether a Default or Event of Default has  occurred  and whether or
not the  signers  know of any Default by the  Company in  performing  any of its
obligations  under  this  Indenture.  If they do  know  of such a  Default,  the
certificate shall describe all such Events of Default or Defaults,  their status
and what action the Company is taking or proposes to take with respect  thereto.
Upon  becoming  aware of any  Default or Event of  Default,  the  Company  shall
deliver an Officers'  Certificate to the Trustee specifying the Default or Event
of Default,  its status and the action the Company proposes to take with respect
thereto.

         SECTION 4.04. Limitation on Dividends and Stock Purchases.  The Company
                       -------------------------------------------
shall not declare or pay any  dividend or make any  distribution  on its Capital
Stock or to its shareholders  (other than dividends or distributions  payable in
its Capital Stock) or purchase, redeem or otherwise acquire or retire for value,
or permit any Subsidiary to purchase or otherwise acquire for value, any Capital
Stock of the Company  (collectively,  "Restricted  Payments") if, at the time of
such Restricted Payment, or after giving effect thereto, (i) an Event of Default
shall have occurred and be continuing, or (ii) a Default shall occur as a result
thereof; provided,  however, that the provisions of this limitation on dividends
shall not prevent (A) the payment of any dividend  within 60 days after the date
of declaration  thereof,  if at said date of declaration  such payment  complied
with the provisions of this  limitation on dividends,  or (B) the acquisition or
retirement of any shares of the Company's  Capital Stock by exchange for, or out
of the proceeds of the sale of shares of, its Capital Stock.

                                       12
<PAGE>

         SECTION 4.05. Pari Passu Indebtedness. There shall be no restriction on
                       -----------------------
the amount or type of  Indebtedness  of the Company which may be pari passu with
(i.e.  having no  priority  of  payment  over and not  subordinated  in right of
payment to) or subordinate to the Debentures.  At June 30, 2000, the Company had
outstanding the following  Debentures which rank pari passu with the Debentures:
$9,000,000  aggregate principal amount of its Series 5/12/95 Registered Floating
Rate Redeemable  Subordinated Debentures (the "Series 5/12/95 Debentures") which
were issued pursuant to an Indenture dated as of June 1, 1995 by and between the
Company and the Bank of New  York,$9,000,000  aggregate  principal amount of its
Series 10/19/95 Registered Floating Rate Redeemable Subordinated Debentures (the
"Series 10/19/95  Debentures")  which were issued pursuant to an Indenture dated
as of  November  1, 1995 by and  between  the  Company and the Bank of New York,
$10,000,000 aggregate principal amount of its Series 5/10/96 Registered Floating
Rate Redeemable  Subordinated Debentures (the "Series 5/10/96 Debentures") which
were issued pursuant to an Indenture dated as of June 1, 1996 by and between the
Company and the Bank of New York,  $5,500,000  aggregate principal amount of its
Series 10/15/96 Registered Floating Rate Redeemable Subordinated Debentures (the
"Series 10/15/96  Debentures")  which were issued pursuant to an Indenture dated
as of  November  1, 1996 by and  between  the  Company and the Bank of New York,
$8,000,000  aggregate principal amount of its Series 4/30/97 Registered Floating
Rate Redeemable Subordinated Debentures (the "Series 4/30/97 Debentures"), which
were issued  pursuant to an Indenture dated as of May 1, 1997 by and between the
Company and the Bank of New York,  $5,400,000  aggregate principal amount of its
Series  11/10/98  Registered  Redeemable  Subordinated  Debentures  (the "Series
11/10/98  Debentures"),  which were issued  pursuant to an Indenture dated as of
December  1, 1998 by and  between  the  Company  and the Bank of New  York,  and
$6,500,000   aggregate   principal  amount  of  its  Series  6/28/99  Registered
Redeemable Subordinated Debentures (the "Series 6/28/99 Debentures"), which were
issued  pursuant  to an  Indenture  dated as of July 1, 1999 by and  between the
Company and the Bank of New York.

                                  ARTICLE FIVE

                              SUCCESSOR CORPORATION
                              ---------------------

         SECTION  5.01.  When the Company May Merge,  etc. The Company shall not
                         ---------------------------------
consolidate with or merge with or into, or transfer all or substantially  all of
its assets to, any other person  unless (i) such other  person is a  corporation
organized or existing  under the laws of the United  States or a state  thereof,
(ii) such  surviving  person  (other  than the  Company)  expressly  assumes  by
supplemental  indenture all the obligations of the Company under the Debentures,
this Indenture and the other agreements related thereto, (iii) immediately after
such transaction no Default or Event of Default exists, and (iv) the Company has
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel each
stating  that such  consolidation,  merger  or  transfer  and such  supplemental
indenture  comply with this  Article and that all  conditions  precedent  herein
provided for have been complied  with.  Thereafter  all such  obligations of the
predecessor corporation shall terminate.

                                       13
<PAGE>

                                   ARTICLE SIX

                              DEFAULTS AND REMEDIES
                              ---------------------

         SECTION 6.01.  Events of Default.  An "Event of Default" occurs if:
                        -----------------

                  (1) the  Company  defaults  in the  payment of interest on any
         Debenture  when  the  same  becomes  due and  payable  and the  default
         continues for a period of 30 days, whether or not such payment shall be
         prohibited by the provisions of Article Ten;

                  (2) the Company  defaults in the payment of  principal  of any
         Debenture  when the same  becomes  due and  payable at  maturity,  upon
         redemption  or  otherwise,   whether  or  not  such  payment  shall  be
         prohibited by the provisions of Article Ten;

                  (3)  the  Company  fails  to  comply  with  any of  its  other
         agreements  in  the  Debentures  or  this  Indenture  and  the  default
         continues for the period and after the notice specified below;

                  (4) the  Company  pursuant  to or within  the  meaning  of any
         Bankruptcy  Law:  (A)  commences a voluntary  case or  proceeding,  (B)
         consents  to  the  entry  of  an  order  for  relief  against  it in an
         involuntary  case or proceeding,  (C) consents to the  appointment of a
         Custodian (as defined herein) of it or for all or substantially  all of
         its property,  or (D) makes a general assignment for the benefit of its
         creditors;

                  (5) a court  of  competent  jurisdiction  enters  an  order or
         decree under any  Bankruptcy  Law that:  (A) is for relief  against the
         Company in an involuntary case or proceeding,  (B) appoints a Custodian
         of the Company or for all or substantially all of its property,  or (C)
         orders the  liquidation  of the Company,  and in each case the order or
         decree remains unstayed and in effect for 60 days.

         The term  "Bankruptcy  Law" means  Title 11,  U.S.  Code or any similar
Federal or state law for the relief of debtors.  The term "Custodian"  means any
receiver, trustee, assignee, liquidator or similar official under any Bankruptcy
Law.

         A default under clause (3) is not an Event of Default until the Trustee
or the  Holders  of at least 25% in  principal  amount  of the then  outstanding
Debentures  notify the Company of the default and the Company  does not cure the
default within 60 days after receipt of the notice.  The notice must specify the
default,  demand that it be  remedied  and state that the notice is a "Notice of
Default".  If the  Holders  of  25%  in  principal  amount  of  the  outstanding
Debentures  request the Trustee to give such notice on their behalf, the Trustee
shall do so.

         SECTION  6.02.  Acceleration.  If any Event of Default  (other  than an
                         ------------
Event of Default  specified in Section 6.01(4) or (5)) occurs and is continuing,
the  Trustee  by  notice  to the  Company,  or the  Holders  of at least  25% in
principal amount of the outstanding  Debentures by notice to the Company and the
Trustee,  may (but shall not be obligated  to) declare the  principal of and all
accrued interest on all the Debentures to be due and payable  immediately.  Upon
such   declaration  such  principal  and  interest  shall  be  due  and  payable
immediately.  If an Event of Default specified in Section 6.01(4) or (5) occurs,

                                       14
<PAGE>

all unpaid  principal and accrued  interest on the Debentures  then  outstanding
shall  ipso  facto  become  and be  immediately  due  and  payable  without  any
       -----------
declaration or other act on the part of the Trustee or any Debentureholder.  The
Holders of a majority  in  principal  amount of the  outstanding  Debentures  by
notice to the Trustee may rescind an  acceleration  and its  consequences if all
existing  Events of  Default  have been cured or waived,  except  nonpayment  of
principal or interest  that has become due solely  because of the  acceleration,
and if the  rescission  would not conflict with any judgment or decree.  No such
rescission  shall affect any subsequent  Default or impair any right  consequent
thereto.

         SECTION  6.03.  Other  Remedies.  If an Event of Default  occurs and is
                         ---------------
continuing,  the Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of principal  of or interest on the  Debentures
or to  enforce  the  performance  of any  provision  of the  Debentures  or this
Indenture.

         The Trustee may maintain a  proceeding  even if it does not possess any
of the Debentures or does not produce any of them in the proceeding.  A delay or
omission by the Trustee or any Debentureholder in exercising any right or remedy
accruing  upon an Event of  Default  shall  not  impair  the  right or remedy or
constitute  a waiver of or  acquiescence  in the Event of Default.  No remedy is
exclusive of any other remedy. All available remedies are cumulative.

         SECTION  6.04.  Waiver of Past  Defaults.  Subject to Sections 6.07 and
                         ------------------------
9.02,  the  Holders  of a  majority  in  principal  amount  of  the  outstanding
Debentures  by  notice  to  the  Trustee  may  waive  a  past  Default  and  its
consequences,  except a Default under Section  6.01(1) or (2). When a Default is
so waived, it shall be deemed cured and ceases.

         SECTION  6.05.  Control by  Majority.  The  Holders  of a  majority  in
                         --------------------
principal amount of outstanding Debentures may direct the time, method and place
of  conducting  any  proceeding  for any  remedy  available  to the  Trustee  or
exercising any trust or power conferred on the Trustee;  provided,  however: (i)
such  direction  shall  not be in  conflict  with any  rule of law or with  this
Indenture;  (ii) the  Trustee  shall not  determine  that the action so directed
would be  unjustly  prejudicial  to the rights of any Holder not taking  part in
such direction;  (iii) the Trustee shall have the right to decline to follow any
such  direction if the Trustee,  being advised by counsel,  determines  that the
action so  directed  may not  lawfully  be taken or if the Trustee in good faith
shall  determine  that the  proceedings so directed would involve it in personal
liability;  or (iv) the Trustee may take any other action  deemed  proper by the
Trustee which is not  inconsistent  with such  direction.  In the event that the
Trustee  takes any action or follows any direction  pursuant to this  Indenture,
the Trustee shall be entitled to indemnification  satisfactory to it in its sole
discretion  against  all risk,  loss or expense  caused by taking such action or
following such direction.

         SECTION 6.06. Limitation of Suits. A Debentureholder may not pursue any
                       -------------------
remedy with respect to this Indenture or the Debentures  unless:  (i) the Holder
gives to the Trustee written notice of a continuing  Event of Default;  (ii) the
Holders of at least 25% in principal amount of the outstanding Debentures make a
written  request  to the  Trustee  to pursue the  remedy;  (iii) such  Holder or
Holders offer and, if requested,  provide to the Trustee  indemnity and security
satisfactory  to the Trustee  against any loss,  liability or expense;  (iv) the

                                       15
<PAGE>

Trustee  does not comply  with the request  within 60 days after  receipt of the
request and the offer and, if  requested,  provision of indemnity  and security;
and (v) during such 60-day period the Holders of a majority in principal  amount
of the  Debentures  do not give the Trustee a direction  inconsistent  with such
request.

         A Debentureholder may not use this Indenture to prejudice the rights of
another  Debentureholder  or to obtain a  preference  or priority  over  another
Debentureholder.

         SECTION 6.07. Rights of Holders to Receive Payment.  Subject to Article
                       ------------------------------------
Ten and notwithstanding any other provisions of this Indenture, the right of any
Holder of a Debenture  to receive  payment of  principal  of and interest on the
Debenture,  on or after the respective due dates expressed in the Debenture,  or
to  bring  suit  for the  enforcement  of any  such  payment  on or  after  such
respective  dates,  shall not be impaired or affected without the consent of the
Holder,  except as to a  postponement  of an interest  payment  consented  to as
provided in clause (ii) of Section 9.02.

         SECTION  6.08.  Collection  Suit by Trustee.  If an Event of Default in
                         ---------------------------
payment of interest or principal  specified in Section 6.01(1) or (2) occurs and
is continuing,  the Trustee may recover  judgment in its own name and as trustee
of an express  trust  against the Company for the whole amount of principal  and
interest  remaining unpaid,  together with interest on overdue principal and, to
the extent  that the  payment of such  interest  is lawful,  interest on overdue
installments of interest.

         SECTION  6.09.  Trustee  May File Proof of Claim.  The Trustee may file
                         --------------------------------
such  proofs of claim  and other  papers or  documents  as may be  necessary  or
advisable  in order to have the claims of the Trustee  (including  any claim for
compensation,  expenses,  disbursements and advances of the Trustee,  its agents
and counsel) and any predecessor Trustee and the Debentureholders allowed in any
judicial  proceedings  relative to the Company,  its  creditors or its property.
Nothing herein  contained  shall be deemed to authorize the Trustee to authorize
or  consent to or accept or adopt on behalf of any  Debentureholder  any plan of
reorganization,  arrangement, adjustment or composition affecting the Debentures
or the rights of any Holder  thereof,  or to  authorize  the  Trustee to vote in
respect of the claim of any Debentureholder in any such proceedings.

         SECTION 6.10. Priorities. If the Trustee collects any money pursuant to
                       ----------
this Article Six, it shall pay out the money in the following  order: (i) first,
to the Trustee and any predecessor  Trustee for costs and expenses of collection
of such  monies and for  compensation  payable to the  Trustee or its agents and
counsel  and  all  other  expenses,  liabilities,  advances  and  other  amounts
incurred,  made or due under  Section  7.07;  (ii) second,  to holders of Senior
Indebtedness  of the Company to the extent required by Article Ten; (iii) third,
to  Debentureholders  for amounts due and unpaid on the Debentures for principal
and interest,  ratably, without preference or priority of any kind, according to
the  amounts due and  payable on the  Debentures  for  principal  and  interest,
respectively; and (iv) fourth, to the Company. The Trustee may fix a record date
and payment date for any payment to Debentureholders pursuant to this Section.

         SECTION 6.11. Undertaking for Costs. In any suit for the enforcement of
                       ---------------------
any right or remedy under this  Indenture or in any suit against the Trustee for
any action  taken or omitted by it as  Trustee,  a court in its  discretion  may

                                       16
<PAGE>

require the filing by any party  litigant in the suit of an  undertaking  to pay
the costs of the suit,  and the court in its  discretion  may assess  reasonable
costs,  including reasonable  attorneys' fees, against any party litigant in the
suit,  having due regard for the merits and good faith of the claims or defenses
made by the party  litigant.  This  Section 6.11 does not apply to a suit by the
Trustee,  a suit by a Holder  pursuant  to Section  6.07 or a suit by Holders of
more than 10% in principal amount of the outstanding Debentures.

                                  ARTICLE SEVEN

                                     TRUSTEE
                                     -------

         SECTION 7.01.  Duties of Trustee.
                        -----------------

         (a) If an Event of Default has occurred and is continuing,  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  person
would exercise or use under the circumstances in the conduct of his own affairs.

         (b)  Except  during the  continuance  of an Event of  Default;  (i) the
Trustee need perform only those duties that are  specifically  set forth in this
Indenture and no others;  and (ii) in the absence of bad faith on its part,  the
Trustee  may  conclusively  rely,  as to the  truth  of the  statements  and the
correctness of the opinions  expressed  therein,  upon  certificates or opinions
furnished to the Trustee and conforming to the  requirements  of this Indenture;
the Trustee,  however,  shall examine the certificates and opinions submitted in
accordance  with Section  11.03 to determine  whether or not they conform to the
requirements of this Indenture.

         (c)  The  Trustee  may  not be  relieved  from  liability  for  its own
negligent  action,  its  own  negligent  failure  to  act  or  its  own  willful
misconduct,  except  that:  (i) this  paragraph  does not  limit  the  effect of
paragraph (b) of this Section 7.01; (ii) the Trustee shall not be liable for any
error of  judgment  made in good faith by a  Responsible  Officer,  unless it is
proved that the Trustee was negligent in ascertaining  the pertinent  facts; and
(iii) the  Trustee  shall not be liable  with  respect to any action it takes or
omits to take in good  faith  in  accordance  with a  direction  received  by it
pursuant to Section 6.05.

         (d) Every  provision of this  Indenture  that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.01.

         (e) The Trustee may refuse to perform any duty or exercise any right or
power or risk its own funds or otherwise incur any financial liability unless it
receives  indemnity  satisfactory  to it against any and all loss,  liability or
expense.

         (f)      The  Trustee  shall not be  liable for  interest  on any money
received  by it except as the  Trustee  may agree with Company.

                                       17
<PAGE>

         (g) Money  held in trust by the  Trustee  need not be  segregated  from
other funds except to the extent required by law.

         SECTION 7.02.  Rights of Trustee.  Subject to Section 7.01:
                        -----------------

         (a) The Trustee may rely on any  document  believed by it to be genuine
and to have been signed or presented by the proper person.  The Trustee need not
investigate any fact or matter stated in the document.

         (b) Before the Trustee acts or refrains from acting,  it may require an
Officers'  Certificate  or an Opinion of Counsel,  which shall  conform with the
provisions of Section  11.04.  The Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on such certificate or opinion.

         (c) The Trustee may act through agents and shall not be responsible for
the  misconduct  or  negligence  of any agent appointed with due care.

         (d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes  to be  authorized  or within its rights or
powers.

         (e) The Trustee may consult  with  counsel and the advice or opinion of
such counsel as to matters of law shall be full and complete  authorization  and
protection from liability in respect to any action taken, omitted or suffered by
it hereunder in good faith and in accordance  with the advise or opinion of such
counsel.

         (f) The Trustee  shall be under no  obligation  to exercise  any of the
rights  or  powers  vested  in it by this  Indenture  at the  request,  order or
direction of any of the Holders of the Debentures, pursuant to the provisions of
this Indenture,  unless such Holders shall have offered to the Trustee  security
and indemnity,  satisfactory to the Trustee in its sole discretion,  against all
costs,  expenses and liabilities  which might be incurred by the Trustee therein
or thereby.

         (g) The Trustee shall not be obligated to make any  investigation  into
the  facts  or  matters  stated  in  any  resolution,   certificate,  statement,
instrument,  opinion, report, notice, request, direction,  consent, order, bond,
debenture or any other paper or document; provided, however, the Trustee, in its
discretion,  may make such further inquiry or  investigation  into such facts or
matters as it may see fit. Nothing  contained in this Indenture shall create any
liability to the Trustee in the event it elects to make or not to make a further
inquiry or investigation to which it is entitled as aforesaid.

         SECTION  7.03.  Individual  Rights  of  Trustee.  The  Trustee  in  its
                         -------------------------------
individual  or any other  capacity may become the owner or pledgee of Debentures
and may otherwise deal with the Company or its  Affiliates  with the same rights
it would  have if it were not the  Trustee.  Any Agent may do the same with like
rights. The Trustee, however, must comply with Sections 7.10 and 7.11.

                                       18
<PAGE>

         SECTION  7.04.   Trustee's   Disclaimer.   The  Trustee  shall  not  be
                          ----------------------
responsible  for and makes no  representation  as to the validity or adequacy of
this Indenture or the Debentures;  it shall not be accountable for the Company's
use of the proceeds from the Debentures;  and, subject to any liabilities  which
may be found to exist under the provisions of the Federal securities laws, shall
not be  responsible  for any  statement of the Company in this  Indenture or any
document  issued in connection  with the sale of the Debentures or any statement
in the  Debentures  other  than  its  certificate  of  authentication  or in any
prospectus  used in  connection  with the sale of such  Debentures,  other  than
statements provided in writing by the Trustee for use in such prospectus.

         SECTION 7.05. Notice of Defaults. If a Default occurs and is continuing
                       ------------------
and  if  it  is  known  to  the  Trustee,   the  Trustee   shall  mail  to  each
Debentureholder  notice of the Default within 90 days after it occurs,  or if it
becomes known to the Trustee after such 90 days, as soon as practicable after it
becomes  known to the  Trustee.  Except in the case of a Default  in  payment of
principal of or interest on any Debenture or any amounts due on redemption,  the
Trustee may  withhold the notice if and so long as the board of directors of the
Trustee,  the executive or any trust committee of such board and/or  Responsible
Officers of the Trustee in good faith  determine(s)  that withholding the notice
is in the interest of Debentureholders.

         SECTION 7.06. Reports by Trustees to Holders. Within 60 days after each
                       ------------------------------
May  15,   beginning  with  May  15,  2001,  the  Trustee  shall  mail  to  each
Debentureholder  a brief report dated as of such May 15 that  complies  with TIA
ss. 313(a). The Trustee also shall comply with TIA ss. 313(b), (c) and (d).

         A  copy  of  each  such   report  at  the  time  of  its   mailing   to
Debentureholders  shall  be  filed by the  Company  with the SEC and each  stock
exchange on which the  Debentures  are listed.  The  Trustee  shall  furnish the
Company  with copies of such reports  sufficiently  in advance of its mailing to
Debentureholders  to permit the Company to make such filings in a timely manner.
The Company shall notify the Trustee when the Debentures are listed on any stock
exchange.

         SECTION 7.07. Compensation and Indemnity.  The Company shall pay to the
                       --------------------------
Trustee such  compensation for its services as the Company and the Trustee shall
from time to time agree in writing. The Trustee's  compensation  hereunder shall
not be limited by any law on compensation  relating to the trustee of an express
trust.  The Company  shall  reimburse  the Trustee upon  request for  reasonable
disbursements,  advances and expenses  incurred or made by it in connection with
its duties  hereunder.  The Company shall  indemnify each of the Trustee and any
predecessor  Trustee against any loss or liability  incurred by it in connection
with  the  administration  of this  trust  and  the  performance  of its  duties
hereunder,  including the reasonable  expenses and attorneys'  fees of defending
itself  against any claim of  liability  arising  hereunder.  The Company  shall
defend any claim  against  the  Trustee of which the  Company  has  notice.  The
Trustee may have  separate  counsel,  and if it does,  the Company shall pay the
reasonable fees and expenses of such counsel. The Company need not reimburse any
expenses  or  indemnify  against any loss or  liability  incurred by the Trustee
through the Trustee's negligence or bad faith.

                                       19
<PAGE>

         The obligations of the Company under this Section 7.07 to indemnify and
compensate  the  Trustee to pay or  reimburse  the  Trustee  for such  expenses,
disbursements,  and  advances  shall  constitute  Indebtedness.  To  secure  the
Company's  payment  obligations  in this Section,  the Trustee shall have a lien
prior to the  Debentures  on all  money or  property  held or  collected  by the
Trustee, except that held in trust to pay principal of or interest on particular
Debentures.

         When  the  Trustee  incurs  expenses  or  renders  services  after  the
occurrence  of an Event of  Default  specified  in Section  6.01(4) or (5),  the
expenses  and the  compensation  for the  services  are  intended to  constitute
expenses of administration under any Bankruptcy Law.

         The  obligations  of the Company  under this Section 7.07 shall survive
the satisfaction and discharge of this Indenture.

         SECTION 7.08.  Replacement of Trustee.  A resignation or removal of the
                        ----------------------
Trustee and the appointment of a successor  Trustee shall become  effective only
upon the  successor  Trustee's  acceptance  of  appointment  as provided in this
Section.  The Trustee may resign by so notifying  the Company.  The Holders of a
majority  in  principal  amount of the  outstanding  Debentures  may  remove the
Trustee by so notifying the Trustee and the Company, and may appoint a successor
Trustee with the Company's  consent.  The Company may remove the Trustee if: (i)
the Trustee  fails to comply with Section  7.10;  (ii) the Trustee is adjudged a
bankrupt or an insolvent;  (iii) a receiver or other public officer takes charge
of the Trustee or its property; or (iv) the Trustee becomes incapable of acting.

         If the  Trustee  resigns or is  removed  or if a vacancy  exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee.
         A  successor  Trustee  shall  deliver  a  written   acceptance  of  its
appointment to the retiring Trustee and to the Company.  Immediately thereafter,
the retiring  Trustee  shall  transfer all property held by it as Trustee to the
successor  Trustee  (subject  to the lien  provided  for in Section  7.07),  the
resignation or removal of the retiring Trustee shall become  effective,  and the
successor  Trustee  shall have all the rights,  powers and duties of the Trustee
under this Indenture. A successor Trustee shall mail notice of its succession to
each Debentureholder.

         If a successor  Trustee  does not take office  within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of a majority in  principal  amount of the  outstanding  Debentures  may
petition any court of competent  jurisdiction for the appointment of a successor
Trustee.

         If the Trustee fails to comply with Section 7.10,  any  Debentureholder
may petition any court of competent  jurisdiction for the removal of the Trustee
and the  appointment  of a successor  Trustee,  provided,  however,  that if the
Trustee shall fail to comply with TIA ss. 310(b)(i),  only a Debentureholder who
has been a bona fide  holder of the  Debentures  for at least six months and has
requested  the Trustee in writing to comply with such  provision may so petition
such court.

                                       20
<PAGE>

         SECTION  7.09.  Successor  Trustee  by  Merger,  etc.  If  the  Trustee
                         -------------------------------------
consolidates with, merges or converts into or transfers all or substantially all
of  its  corporate  trust  business  to,  another  corporation,   the  successor
corporation without any further act shall be the successor Trustee.

         SECTION 7.10. Eligibility;  Disqualification.  There shall at all times
                       ------------------------------
be a trustee hereunder which shall be a corporation organized and doing business
under the laws of the United  States or of any state  thereof  authorized  under
such laws to exercise corporate trust powers, shall be subject to supervision or
examination by Federal or state authority and shall at all times have a combined
capital and surplus of at least $1,000,000. If such trustee publishes reports of
condition  at least  annually,  pursuant to law or to the  requirements  of said
supervisory or examining authority,  then for the purposes of this Section 7.10,
the  combined  capital  and  surplus of such  trustee  shall be deemed to be its
combined  capital and surplus as set forth in its most recent  published  annual
report of condition.

         This   Indenture   shall  always  have  a  trustee  who  satisfies  the
requirements of TIA ss. 310(a)(1) and (2). The Trustee shall comply with TIA ss.
310(b) and, for purposes of TIA ss.310(b)(1),  the following  indentures satisfy
the  requirements  for such  exclusion  set forth in TIA ss.  310(b)(1)(i):  the
Indentures dated as of June 1, 1995, November 1, 1995, June 1, 1996, November 1,
1996, May 1, 1997,  December 1, 1998 and July 1, 1999,  each between the Company
and the Bank of New York as Trustee.

         SECTION 7.11.  Preferential  Collection of Claims  Against the Company.
                        --------------------------------------------------------
The  Trustee  shall  be  subject  to TIA  ss.  311(a),  excluding  any  creditor
relationship  arising as provided in TIA ss. 311(b).  A Trustee who has resigned
or been removed shall be subject to TIA ss. 311(a) to the extent indicated.

         SECTION 7.12. Paying Agents.  The Company shall cause each Paying Agent
                       -------------
other  than  the  Trustee  to  execute  and  deliver  to it and the  Trustee  an
instrument  in which such Agent  shall  agree with the  Trustee,  subject to the
provisions of this Section 7.12;  (i) that it will hold sums held by it as Agent
for the payment of principal of or interest on the Debentures (whether such sums
have been paid to it by the  Company  or by any  obligor on the  Debentures)  in
trust for the  benefit of Holders  of the  Debentures;  (ii) that it will at any
time during the  continuance of any Event of Default,  upon written request from
the Trustee,  deliver to the Trustee all sums so held in trust by it; (iii) that
it will give the  Trustee  written  notice  within  three  Business  Days of any
failure of the Company (or by any obligor on the  Debentures)  in the payment of
any  installment of the principal of or interest on the Debentures when the same
shall be due and payable;  and (iv) that it will comply with the  provisions  of
the TIA applicable to it.

                                       21
<PAGE>

                                  ARTICLE EIGHT

                             DISCHARGE OF INDENTURE
                             ----------------------

         SECTION 8.01. Termination of the Company's Obligations. The Company may
                       ----------------------------------------
terminate all of its obligations  under the Debentures and this Indenture if all
Debentures previously authenticated and delivered (other than destroyed, lost or
stolen  Debentures  which have been replaced or paid) have been delivered to the
Trustee for cancellation or if:

                  (1) the  Debentures  mature within one year or all of them are
         to  be  called  for  redemption  within  one  year  under  arrangements
         satisfactory to the Trustee for giving the notice of redemption;

                  (2) the Company irrevocably deposits in trust with the Trustee
         money  or  direct   non-callable   obligations   of,  or   non-callable
         obligations  guaranteed  by, the United States for the payment of which
         guarantee or obligation  the full faith and credit of the United States
         is pledged ("U.S. Government Obligations"), sufficient to pay principal
         of  and  interest  on  the   outstanding   Debentures  to  maturity  or
         redemption,  as the case  may be,  and  immediately  after  making  the
         deposit,   the  Company   shall  give  notice  of  such  event  to  the
         Debentureholders;  provided,  however, that if such irrevocable deposit
         in trust with the  Trustee of cash or U.S.  Government  Obligations  is
         made, the Company shall have delivered to the Trustee either an Opinion
         of  Counsel  with no  material  qualifications  in form  and  substance
         satisfactory  to  the  Trustee  to  the  effect  that  Holders  of  the
         Debentures  (i) will not  recognize  income,  gain or loss for  Federal
         income tax  purposes as a result of such  deposit  (and the  defeasance
         contemplated  in  connection  therewith)  and (ii) will be  subject  to
         Federal  income tax on the same  amounts  and in the same manner and at
         the same  times  as  would  have  been  the  case if such  deposit  and
         defeasance had not occurred,  or an applicable favorable ruling to that
         effect is received from or published by the Internal Revenue Service;

                  (3) the  Company  has paid or  caused to be paid all sums then
         payable by the Company to the Trustee  hereunder as of the date of such
         deposit; and

                  (4) the Company  has  delivered  to the  Trustee an  Officers'
         Certificate and an Opinion of Counsel, each stating that all conditions
         precedent   provided  for  herein  relating  to  the  satisfaction  and
         discharge of this  Indenture  have been  complied  with.  The Company's
         obligations  in  paragraph 9 of the  Debentures  and in Sections  2.03,
         2.04, 2.05, 2.07,  2.08,  4.01, 7.07 and 8.03,  however,  shall survive
         until  the  Debentures  are  no  longer  outstanding.  Thereafter,  the
         Company's obligations in such paragraph 9 and in Sections 7.07 and 8.03
         shall survive.

         After such irrevocable deposit and delivery of an Officers' Certificate
and Opinion of Counsel  pursuant to this Section 8.01,  the Trustee upon request
shall  acknowledge in writing the discharge of the Company's  obligations  under
the  Debentures  and this  Indenture  except  for  those  surviving  obligations
specified above.

         SECTION  8.02.  Application  of Trust Money.  The Trustee shall hold in
                         ---------------------------
trust  money and U.S.  Government  Obligations  deposited  with it  pursuant  to
Section 8.01. It shall apply the deposited money through the Paying Agent and in

                                       22
<PAGE>

accordance  with this  Indenture  to the payment of principal of and interest on
Debentures.  Money and U.S. Government Obligations so held in trust shall not be
subject to Article Ten.

         SECTION 8.03.  Repayment to the Company.  Subject to Section 7.07,  the
                        ------------------------
Trustee and the Paying Agent shall  promptly pay to the Company upon request any
excess money or securities  held by them at any time. The Trustee and the Paying
Agent  shall pay to the  Company  upon  request  any money  held by them for the
payment of principal or interest that remains unclaimed for two years,  provided
such request is made by the Company within one year after the expiration of such
two year period that such money remains unclaimed. Thereafter, the Company shall
have no right to request  repayment of unclaimed money, and such unclaimed money
shall be held and disposed of by the Trustee in accordance  with applicable law.
The Trustee and the Paying  Agent shall have no right to request or require that
the Company accept repayment of any unclaimed money.

         The  Trustee or the Paying  Agent,  before  being  required to make any
repayment to the Company of unclaimed  money,  may at the expense of the Company
mail to each Holder who has failed to claim a payment of  interest or  principal
which is due,  notice that such money remains  unclaimed and that,  after a date
specified  therein  (which  shall not be less than 30 days from the date of such
mailing),  any unclaimed  balance of such money then remaining will be repaid to
the Company.  After  payment to the Company,  Debentureholders  entitled to such
money  must  look  to the  Company  for  payment  as  general  creditors  unless
applicable  abandoned  property law designates another person, and all liability
of the Trustee or Paying Agent with respect to such money shall thereupon cease.

                                  ARTICLE NINE

                       AMENDMENTS, SUPPLEMENTS AND WAIVERS
                       -----------------------------------

         SECTION 9.01. Without Consent of Holders. The Company, with the consent
                       --------------------------
of Trustee,  may amend or supplement  this Indenture or the  Debentures  without
notice  to or  consent  of any  Debentureholder:  (i)  to  cure  any  ambiguity,
omission, defect or inconsistency; (ii) to comply with Section 5.01; or (iii) to
make  any   change   that  does  not   adversely   affect   the  rights  of  any
Debentureholder.   The  Trustee  shall  not  be  obligated  to  enter  into  any
supplemental  indenture which affects its own rights, duties or immunities under
this Indenture.

         SECTION 9.02. With Consent of Holders. The Company, with the consent of
                       -----------------------
the Trustee,  may amend or supplement  this Indenture or the Debentures  without
notice to any Debentureholder, but with the written consent of the Holders of at
least a majority in principal amount of the outstanding Debentures.  The Holders
of a  majority  in  principal  amount of the  outstanding  Debentures  may waive
compliance by the Company with any provision of this Indenture or the Debentures
without   notice  to  any   Debentureholder.   Without   the   consent  of  each
Debentureholder affected, however, an amendment, supplement or waiver, including
a waiver  pursuant to Section 6.04, may not: (i) reduce the amount of Debentures
whose  Holders must consent to an amendment,  supplement or waiver;  (ii) reduce
the rate of or extend the time for payment of interest on any Debenture  (except
that  Holders  of not  less  than 75% in  principal  amount  of all  outstanding
Debentures  may  consent,  on behalf of the  Holders  of all of the  outstanding
Debentures,  to the  postponement  of any  interest  payment  for a  period  not
exceeding  three  years from its due date);  (iii)  reduce the  principal  of or

                                       23
<PAGE>

extend the fixed maturity of any Debenture;  (iv) waive a default in the payment
of the principal of or interest on, or other redemption payment with respect to,
any Debenture, (v) make any Debenture payable in money other than that stated in
the Debenture;  (vi) make any change in Article Ten that  adversely  affects the
rights of any Debentureholder; or (vii) make any change in Section 6.04, 6.07 or
the third sentence of this Section 9.02.

         After an  amendment,  supplement  or waiver  under  this  Section  9.02
becomes  effective,  the  Company  shall  mail to the  Holders a notice  briefly
describing the amendment.

         It shall not be  necessary  for the consent of the  Holders  under this
section to approve the particular form of any proposed  amendment or supplement,
but it shall be sufficient if such consent approved the substance thereof.

         Upon the request of the Company,  accompanied  by a  resolution  of the
Board of Directors or any duly  authorized  committee  thereof,  authorizing the
execution  of any such  supplemental  indenture,  and upon the  filing  with the
Trustee  of  evidence  satisfactory  to  the  Trustee  of  the  consent  of  the
Debentureholders  as  aforesaid,  the  Trustee  shall  join with the  Company in
execution of such  supplemental  indenture  unless such  supplemental  indenture
affects the Trustee's own rights, duties or immunities under this Indenture.

         SECTION 9.03. Execution of Supplemental  Indentures.  In executing,  or
                       -------------------------------------
accepting the additional trust created by, any supplemental  indenture permitted
by this  Article or the  modifications  thereby  of the  trusts  created by this
Indenture,  the Trustee  shall be entitled to receive,  and  (subject to Section
7.01) shall be fully  protected in relying upon,  an Opinion of Counsel  stating
that the execution of such supplemental  indenture is authorized or permitted by
this  Indenture.  The Trustee may, but shall not be obligated to, enter into any
such  supplemental  indenture  which affects the  Trustee's own rights,  duties,
liabilities or immunities under this Indenture or otherwise.

         SECTION 9.04.  Compliance  with Trust  Indenture  Act.  Every amendment
                        --------------------------------------
to or  supplement of this  Indenture or the Debentures shall comply with the TIA
as then in effect.

         SECTION 9.05.  Revocation  and Effect of Consents.  Until an amendment,
                        ----------------------------------
supplement or waiver becomes effective, a consent to an amendment, supplement or
waiver by a Holder of a  Debenture  is a  continuing  consent  by the Holder and
every  subsequent  Holder of that  Debenture or portion of that  Debenture  that
evidences the same debt as the consenting Holder's  Debenture,  even if notation
of the  consent  is not made on any  Debenture.  Any such  Holder or  subsequent
Holder,  however,  may revoke the  consent as to his  Debenture  or portion of a
Debenture.  Such revocation  shall be effective only if the Trustee receives the
notice of revocation before the date the amendment, supplement or waiver becomes
effective. An amendment,  supplement or waiver shall become effective on receipt
by the Trustee of written consents from the Holders of the requisite  percentage
in principal amount of the outstanding Debentures.

         The Company may,  but shall not be obligated  to, fix a record date for
the  purpose of  determining  the persons  entitled to consent to any  indenture
supplemental hereto. If a record date is fixed, the Holders on such record date,
or their duly designated  proxies,  and only such persons,  shall be entitled to
consent  to such  supplemental  indenture,  whether or not such  Holders  remain
Holders  after such record date;  provided,  that unless such consent shall have
become  effective by virtue of the  requisite  percentage  having been  obtained
prior to the date which is six months after such record  date,  any such consent

                                       24
<PAGE>

previously given shall automatically and without further action by any Holder be
canceled and of no further effect.

         After an amendment,  supplement or waiver becomes  effective,  it shall
bind every Debentureholder  unless it makes a change described in any of clauses
(i) through  (vii) of Section 9.02.  In that case the  amendment,  supplement or
waiver shall bind each Holder of a Debenture  who has  consented to it and every
subsequent  Holder of a Debenture or portion of a Debenture  that  evidences the
same  debt as the  consenting  Holder's  Debenture  (except  that an  amendment,
supplement or wavier  postponing any interest payment for a period not exceeding
three years from its due date shall, as provided in clause (ii) of Section 9.02,
bind all  Debentureholders  upon the  consent of Holders of not less than 75% in
principal amount of all outstanding Debentures).

         SECTION 9.06.  Notation on or Exchange of Debentures.  If an amendment,
                        -------------------------------------
supplement or waiver  changes the terms of a Debenture,  the Trustee may require
the Holder of the Debenture to deliver it to the Trustee.  The Trustee may place
an appropriate  notation on the Debenture  about the changed terms and return it
to the Holder.  Alternatively,  if the Company or the Trustee so determines, the
Company  in  exchange  for the  Debenture  shall  issue  and the  Trustee  shall
authenticate a new Debenture  that reflects the changed  terms.  Failure to make
the appropriate  notation or issue a new Debenture shall not affect the validity
and effect of such amendment, supplement or waiver.

         SECTION 9.07. Trustee to Sign Amendments, etc. The Trustee may but need
                       -------------------------------
not sign any amendment, supplement or waiver authorized pursuant to this Article
if the  amendment,  supplement  or waiver  adversely  affects  the rights of the
Trustee.  The Trustee  shall be  entitled  to request  and receive an  indemnity
satisfactory to it before signing any amendment, supplement or waiver.

                                       25
<PAGE>

                                   ARTICLE TEN

                                  SUBORDINATION
                                  -------------

         SECTION 10.01.  Agreement to Subordinate.  The Company,  for itself and
                         ------------------------
its successors,  and each Holder,  by his acceptance of Debentures,  agrees that
the payment of the  principal  of,  interest on or any other  amounts due on the
Debentures is subordinated in right of payment,  to the extent and in the manner
stated  in this  Article  Ten,  to the  prior  payment  in  full  of all  Senior
Indebtedness.  Each Holder by his  acceptance of the  Debentures  authorizes and
directs  the Trustee on his behalf to take such  action as may be  necessary  or
appropriate to  effectuate,  as between the holders of Senior  Indebtedness  and
such  Holder,  the  subordination  provided in this Article Ten and appoints the
Trustee his attorney-in-fact for such purpose.

         This Article Ten shall  constitute  a  continuing  offer to all persons
who, in reliance upon such  provisions,  become holders of, or continue to hold,
Senior  Indebtedness,  and such  provisions of this Article Ten are made for the
benefit  of the  holders  of  Senior  Indebtedness,  and such  holders  are made
obligees  under this  Article Ten and they and/or each of them may enforce  such
provisions  of  this  Article  Ten.  The  Trustee  has no  fiduciary  duties  or
obligations to holders of Senior Indebtedness.

         "Senior  Indebtedness" means Indebtedness of the Company outstanding at
any time, whether outstanding on the date hereof or hereafter created, which (i)
is secured,  in whole or in part, by any asset or assets owned by the Company or
a  Subsidiary,  or (ii) arises from  unsecured  borrowings by the Company from a
commercial  bank, a savings bank, a savings and loan  association,  an insurance
company, a company whose securities are traded in a national  securities market,
or any  wholly-owned  subsidiary of any of the  foregoing,  or (iii) arises from
unsecured  borrowings  by the Company  from any pension  plan (as defined in ss.
3(2) of the Employee  Retirement  Income  Security Act of 1974, as amended),  or
(iv) arises from  borrowings  by the Company  which are  evidenced by commercial
paper, or (v) other unsecured borrowings by the Company which are subordinate to
Indebtedness  of a type  described  in  clauses  (i),  (ii)  or (iv)  above  if,
immediately after the issuance thereof, the total capital,  surplus and retained
earnings of the Company exceed the aggregate of the outstanding principal amount
of such borrowings,  or (vi) is a guarantee or other liability of the Company of
or with respect to  Indebtedness  of a Subsidiary of a type  described in any of
clause (ii), (iii) or (iv) above.

         SECTION 10.02.  Debentures  Subordinated to Prior Payment of All Senior
                         -------------------------------------------------------
Indebtedness on Dissolution,  Liquidation or Reorganization of the Company. Upon
--------------------------------------------------------------------------
any  distribution  of assets of the  Company  in any  dissolution,  winding  up,
liquidation or reorganization of the Company (whether in bankruptcy,  insolvency
or  receivership  proceedings or upon an assignment for the benefit of creditors
or otherwise);

         (a) the holders of all Senior  Indebtedness  shall first be entitled to
receive payment in full of all principal thereof, interest due thereon and other
amounts due thereon before the Holders of the Debentures are entitled to receive
any payment on account of the principal of or interest on the Debentures;

         (b) any payment or distribution of assets of the Company of any kind or
character,  whether in cash, property or securities, to which the Holders of the
Debentures  or the Trustee on behalf of the Holders of the  Debentures  would be
entitled  except for the  provisions  of this  Article Ten,  including  any such

                                       26
<PAGE>

payment or  distribution  which may be payable or  deliverable  by reason of the
payment of any other  indebtedness  of the  Company  being  subordinated  or the
payment of the Debentures,  shall be paid by the liquidating trustee or agent or
other person making such payment or distribution  directly to the holders of the
Senior Indebtedness or their  representative (pro rata as to each such holder or
representative  on  the  basis  of  the  respective  amounts  of  unpaid  Senior
Indebtedness  held or  represented  by each),  to the extent  necessary  to make
payment in full of all Senior Indebtedness remaining unpaid, after giving effect
to any concurrent  payment or distribution or provision  therefor to the holders
of such Senior  Indebtedness,  except that  Holders of the  Debentures  shall be
entitled to receive  securities that are subordinated to Senior  Indebtedness to
at least the same extent as the Debentures; and

         (c) in the event that  notwithstanding the foregoing provisions of this
Section 10.02,  any payment or distribution of assets of the Company of any kind
or  character,  whether in cash,  property  or  securities,  including  any such
payment or  distribution  which may be payable or  deliverable  by reason of the
payment of any other  indebtedness  of the  Company  being  subordinated  to the
payment of the  Debentures,  shall be  received by the Trustee or the Holders of
the Debentures on account of principal of or interest on the  Debentures  before
all Senior  Indebtedness  is paid in full, or effective  provision  made for its
payment,  such payment or  distribution  (subject to the  provisions of Sections
10.05 and 10.06)  shall be received and held in trust for and shall be paid over
to the holders of the Senior Indebtedness  remaining unpaid or unprovided for or
their  representative  (pro rata as  provided  in  subsection  (b)  above),  for
application  to the  payment of such Senior  Indebtedness  until all such Senior
Indebtedness shall have been paid in full, after giving effect to any concurrent
payment or  distribution  or  provision  therefor  to the holders of such Senior
Indebtedness, except that Holders of the Debentures shall be entitled to receive
securities  that are  subordinated  to Senior  Indebtedness to at least the same
extent as the Debentures.

The Company shall give prompt written notice to the Trustee of any  dissolution,
winding up,  liquidation or  reorganization of the Company and of any fact known
to the  Company  which  would  prohibit  the making of any  payment to or by the
Trustee in respect of the Debentures.

         SECTION 10.03.  Debentureholders  to be Subrogated to Rights of Holders
                         -------------------------------------------------------
of  Senior  Indebtedness.   Subject  to  the  payment  in  full  of  all  Senior
------------------------
Indebtedness  pursuant to this Article Ten, the Holders of the Debentures  shall
be  subrogated  equally  and  ratably to the right of the  holders of the Senior
Indebtedness  to receive  payments  or  distributions  of assets of the  Company
applicable to the Senior  Indebtedness until all amounts owing on the Debentures
shall be paid in full,  and for the purpose of such  subrogation  no payments or
distributions  to the holders of the Senior  Indebtedness by or on behalf of the
Company or by or on behalf of the  Holders of the  Debentures  by virtue of this
Article  Ten  which  otherwise  would  have  been  made  to the  Holders  of the
Debentures shall, as among the Company,  its creditors other than holders of the
Senior  Indebtedness and the Holders of the Debentures,  be deemed to be payment
by the Company to or on account of the Senior Indebtedness,  it being understood
that the  provisions of this Article Ten are intended  solely for the purpose of
defining the relative rights of the Holders of the Debentures,  on the one hand,
and the holders of the Senior Indebtedness, on the other hand.

         SECTION  10.04.  Obligation  of  the  Company  Unconditional.   Nothing
                          -------------------------------------------
contained in this Article Ten or elsewhere in this Indenture or in any Debenture
is intended to or shall impair, as between the Company, its creditors other than
Holders of Senior Indebtedness and the Holders of the Debentures, the obligation

                                        27
<PAGE>

of the Company,  which is absolute and  unconditional,  to pay to the Holders of
the  Debentures  the principal of and interest on the Debentures as and when the
same shall become due and payable in accordance with their terms, or is intended
to or shall  affect the  relative  rights of the Holders of the  Debentures  and
creditors of the Company, other than the holders of the Senior Indebtedness, nor
shall  anything  herein or  therein  prevent  the  Trustee  or the Holder of any
Debenture  from  exercising all remedies  otherwise  permitted by applicable law
upon default under this  Indenture,  subject to the rights,  if any,  under this
Article Ten of the holders of Senior  Indebtedness in respect of cash,  property
or securities of the Company received upon the exercise of any such remedy. Upon
any  distribution of assets of the Company  referred to in this Article Ten, the
Trustee, subject to the provisions of Sections 7.01 and 7.02, and the Holders of
the  Debentures  shall be  entitled to rely upon any order or decree made by any
court  of  competent  jurisdiction  in  which  such  dissolution,   winding  up,
liquidation or reorganization  proceedings are pending,  or a certificate of the
liquidating  trustee or agent or other  person  making any  distribution  to the
Trustee or the Holders of the Debentures,  for the purpose of  ascertaining  the
persons entitled to participate in such distribution,  the holders of the Senior
Indebtedness  and other  Indebtedness  of the  Company,  the  amount  thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article Ten.

         Nothing contained in this Article Ten or elsewhere in this Indenture or
in any Debenture is intended to or shall affect the obligation of the Company to
make or prevent the Company from making,  at any time except during the pendency
of  any  dissolution,  winding-up,  liquidation  or  reorganization  proceeding,
payments at any time of the principal of or interest on the Debentures.

         SECTION 10.05. Knowledge of Trustee.  Notwithstanding any provisions of
                        --------------------
this  Indenture,  the Trustee shall not be charged with actual  knowledge of the
existence of any facts which would  prohibit the making of any payment of monies
to or by the  Trustee,  or the taking or not  taking of any other  action by the
Trustee, until two Business Days after the Trustee through a Responsible Officer
shall have received written notice thereon from the Company, any Debentureholder
or any  Paying  Agent or the  holder  or  representative  of any class of Senior
Indebtedness.

         SECTION 10.06.  Application by Trustee of Monies  Deposited With It. If
                         ---------------------------------------------------
at least  two  Business  Days  prior  to the date on which by the  terms of this
Indenture any monies  deposited  with the Trustee or any Paying Agent may become
payable for any purpose (including,  without  limitation,  the payment of either
the  principal of or the interest on any  Debenture)  the Trustee shall not have
received with respect to such monies the notice  provided for in Section  10.05,
then the Trustee  shall have full power and authority to receive such monies and
to apply the same to the purpose for which they were  received  and shall not be
affected by any notice to the  contrary  which may be received by it on or after
such date. This Section shall be construed solely for the benefit of the Trustee
and Paying Agent and shall not otherwise  affect the rights of holders of Senior
Indebtedness.

         SECTION 10.07.  Subordination  Rights Not Impaired by Acts or Omissions
                         -------------------------------------------------------
of the  Company or Holders of Senior  Indebtedness.  No right of any  present or
--------------------------------------------------
future holders of any Senior  Indebtedness to enforce  subordination as provided
herein  shall at any time in any way be  prejudiced  or  impaired  by any act or
failure to act on the part of the  Company  or by any act or failure to act,  in
good faith, by any such holder,  or by any noncompliance by the Company with the
terms of this  Indenture,  regardless  of any  knowledge  thereof which any such
holder may have or be otherwise charged with. The holders of Senior Indebtedness
may extend,  renew,  modify or amend the terms of the Senior Indebtedness or any

                                        28
<PAGE>

security therefor and release, sell or exchange such security and otherwise deal
freely with the Company,  all without  affecting the liabilities and obligations
of the parties to the Indenture or the Holders. No provision in any supplemental
indenture  which  affects  the  superior  position  of the  holders  of any then
existing  Senior  Indebtedness  shall be  effective  against  the holders of the
Senior Indebtedness who have not consented thereto.

         SECTION  10.08.   Debentureholders   Authorize  Trustee  to  Effectuate
                           -----------------------------------------------------
Subordination of Debentures. Each Holder of the Debentures by acceptance thereof
---------------------------
authorizes  and expressly  directs the Trustee on its, his or her behalf to take
such action as may be necessary or  appropriate  in the sole  discretion  of the
Trustee  to  effectuate  the  subordination  provided  in this  Article  Ten and
appoints  the  Trustee  its,  his  or her  attorney-in-fact  for  such  purpose,
including,  in  the  event  of  any  dissolution,  winding  up,  liquidation  or
reorganization of the Company (whether in bankruptcy, insolvency or receivership
proceedings  or upon an assignment  for the benefit of creditors or  otherwise),
the  immediate  filing  of a claim for the  unpaid  balance  of its,  his or her
Debentures in the form required in said  proceedings  and cause said claim to be
approved; provided, however, that the Trustee shall not be liable for any action
or failure to act in  accordance  with this Article Ten. If the Trustee does not
file a proper  claim or proof of debt in the form  required  in such  proceeding
prior to 30 days before the expiration of the time to file such claim or claims,
then the  holders of Senior  Indebtedness  have the right to file and are hereby
authorized to file an appropriate claim for and on behalf of the Holders of said
Debentures.

         SECTION  10.09.  Right of  Trustee  to Hold  Senior  Indebtedness.  The
                          ------------------------------------------------
Trustee  shall be entitled to all of the rights set forth in this Article Ten in
respect of any Senior  Indebtedness at any time held by it to the same extent as
any other holder of Senior Indebtedness,  and nothing in this Indenture shall be
construed to deprive the Trustee of any of its rights as such holder.

         SECTION  10.10.  Article  Ten Not to  Prevent  Events of  Default.  The
                          ------------------------------------------------
failure  to make a payment on account of  principal  shall not be  construed  as
preventing the occurrence of an Event of Default under Section 6.01.

         SECTION  10.11.   No  Fiduciary  Duty  Created  to  Holders  of  Senior
                           -----------------------------------------------------
Indebtedness.  With respect to the holders of Senior  Indebtedness,  the Trustee
------------
undertakes to perform or to observe only such of its  covenants and  obligations
as are specifically  set forth in this Article Ten, and no implied  covenants or
obligations  with  respect to the holders of Senior  Indebtedness  shall be read
into this Indenture against the Trustee.  The Trustee shall not be deemed to owe
any  fiduciary  duty to the  holders  of  Senior  Indebtedness  by virtue of the
provisions of this Article Ten.

         SECTION  10.12.  Trustee's  Compensation  Not  Prejudiced.  Nothing in
                          ----------------------------------------
this  Article  Ten shall  apply to  amounts  due  to  the  Trustee  pursuant  to
Section 7.07.

                                       29
<PAGE>

                                 ARTICLE ELEVEN

                                  MISCELLANEOUS
                                  -------------

         SECTION 11.01.  Trust Indenture Act Controls.  If any provision of this
                         ----------------------------
Indenture  limits,  qualifies  or  conflicts  with  another  provision  which is
required to be included in this  Indenture by the TIA,  the  required  provision
shall control.

         SECTION 11.02.  Notices.   Any  notice  or   communication   shall  be
                         -------
sufficiently  given if in writing and delivered or mailed as follows:

         (a) Notices or  communications  to the Company or the Trustee  shall be
given only by hand  delivery or by  certified  or  registered  first class mail,
return receipt requested, or by facsimile transmission promptly followed by hand
delivery or certified or registered first class mail, return receipt  requested,
as follows:

         If to the Company, addressed to:

                  INTERVEST  CORPORATION OF NEW YORK
                  10 Rockefeller Plaza, Suite 1015
                  New York, New York 10020-1903

         If to the Trustee, addressed to:

                  THE BANK OF NEW YORK
                  101 Barclay Street, 21 West
                  New York, New York  10286
                  Attention:  Corporate Trust Department

         Any notice or  communication  to the  Company or the  Trustee  shall be
deemed given on the day  delivered and receipted for if delivered by hand, or on
the day the  return  receipt  card is signed on  behalf  of the  Company  or the
Trustee if sent by certified or registered  mail.  The Company or the Trustee by
notice  to the  other  and  to  Debentureholders  may  designate  additional  or
different addresses for subsequent notices or communications.

         (b) Notices or communications  to a Debentureholder  shall be mailed by
first class mail to such  Debentureholder  at the address  which  appears on the
registration  books of the  Registrar  and shall be  sufficiently  given to such
Debentureholder if so mailed within the time prescribed.

         Failure to mail a notice or communication to a  Debentureholder  or any
defect  in  it  shall  not  affect  its   sufficiency   with  respect  to  other
Debentureholders. If a notice or communication is mailed to a Debentureholder in
the manner provided in this paragraph (b), it is duly given,  whether or not the
addressee  receives  it.  If the  Company  mails a notice  or  communication  to
Debentureholders  it shall mail a copy of such  notice to the  Trustee  and each
Agent at the same time.

         SECTION 11.03. Certificate and Opinion as to Conditions Precedent. Upon
                        --------------------------------------------------
any  request or  application  by the  Company to the  Trustee to take any action
under this Indenture, the Company shall furnish to the Trustee: (i) an Officers'

                                       30
<PAGE>

Certificate in form and substance  satisfactory  to the Trustee stating that all
conditions  precedent,  if any,  provided for in this Indenture  relating to the
proposed actions have been complied with; and (ii) an Opinion of Counsel in form
and substance  satisfactory  to the Trustee stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.

         SECTION 11.04.  Statements  Required in  Certificate  or Opinion.  Each
                         ------------------------------------------------
certificate  or opinion with respect to compliance  with a condition or covenant
provided for in this Indenture  shall  include:  (i) a statement that the person
making such  certificate or opinion has read such covenant or condition;  (ii) a
brief statement as to the nature and scope of the  examination or  investigation
upon which the statements or opinions  contained in such  certificate or opinion
are based;  (iii) a statement  that, in the opinion of such person,  he has made
such  examination or  investigation  as is necessary to enable him to express an
informed  opinion as to  whether  or not such  covenant  or  condition  has been
complied with; and (iv) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.

         SECTION  11.05.  Rules by Trustee  and  Agents.  The  Trustee  may make
                          -----------------------------
reasonable  rules  for  action by, or  at a  meeting  of, Debentureholders.  The
Registrar or Paying Agent may make reasonable rules for its functions.

         SECTION  11.06.  Legal  Holidays.  A "Legal  Holiday" is a Saturday,  a
                          ---------------
Sunday or a day on which banking institutions are not required to be open in the
City of New York,  in the State of New York, or in the city in which the Trustee
administers its corporate  trust business.  If a payment date is a Legal Holiday
at a place of payment,  payment may be made at such place on the next succeeding
day  that  is not a  Legal  Holiday,  and  no  interest  shall  accrue  for  the
intervening period.

         SECTION  11.07.  Governing  Law.   The  laws of  the State of New York,
                          --------------
without  regard  to  the  principles  of  conflicts  of law,  shall  govern this
Indenture and the Debentures.

         SECTION 11.08. No Recourse Against Others.  Liabilities of directors,
                        --------------------------
officers,  employees and stockholders,  as such, of  the Company are  waived and
released as provided in paragraph 14 of the Debentures.

         SECTION 11.09.  Successors.  All agreements  of  the  Company  in  this
                         ----------
Indenture and the  Debentures  shall bind its successors. All agreements of the
Trustee in this Indenture shall bind its successors.

         SECTION 11.10.  Duplicate  Originals.  The  parties may sign any number
                          --------------------
of copies of this  Indenture.  Each signed copy shall be an original, but all of
them together represent the same agreement.

         SECTION 11.11. Separability. In case any provision in this Indenture or
                        ------------
in the  Debentures  shall be invalid,  illegal or  unenforceable,  the validity,
legality and enforceability of the remaining  provisions shall not in any way be
affected or impaired thereby, and a Holder shall have no claim against any party
hereto.

                                       31
<PAGE>







                                   SIGNATURES

Dated as of September 15, 2000                     INTERVEST CORPORATION
                                   OF NEW YORK

                                          By:  /s/ Lowell S. Dansker
                                             -----------------------
                                          Name:    Lowell S. Dansker
                                          Title:   President
Attest:  /s/ Lawrence G. Bergman
       -------------------------
Name:    Lawrence G. Bergman
Title:            Secretary
                                   THE BANK OF NEW YORK
                                   as Trustee
                                          By:  /s/ Patrick O'Leary
                                             --------------------------
                                        Name:  Patrick O'Leary
                                             --------------------------
                                       Title:  Assistant Vice President
                                             --------------------------
Attest:  /s/ Walter N. Gitlin
-----------------------------
Name:  Walter N. Gitlin
      -----------------------
Title:  Vice President
      -----------------------



                                       32
<PAGE>



                                                                      Exhibit A
                                                                      ---------

THIS  DEBENTURE HAS NOT BEEN  REGISTERED  UNDER THE  SECURITIES ACT OF 1933 (THE
"ACT") OR UNDER ANY  APPLICABLE  STATE LAW AND MAY NOT BE  TRANSFERRED,  SOLD OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF EFFECTIVE  REGISTRATION UNDER THE ACT OR
AN  OPINION  OF  COUNSEL  REASONABLY  SATISFACTORY  TO  THE  COMPANY  THAT  SUCH
REGISTRATION  IS NOT  REQUIRED  UNDER  THE  ACT AND THE  RULES  AND  REGULATIONS
PROMULGATED THEREUNDER OR SUCH STATE SECURITIES LAW.

                            (FORM OF ACCRUAL DEBENTURE MATURING January 1, 2004)
Number R(          /04)A-                                                     $
         ----------

                        INTERVEST CORPORATION OF NEW YORK
            Series 9/18/00 Subordinated Debenture due January 1, 2004


                  INTERVEST   CORPORATION  OF  NEW  YORK,  a  corporation   duly
organized and existing under the laws of the State of New York (the  "Company"),
promises   to   pay   to  or   registered   assigns   the   principal   sum   of

----------------------------------------  Dollars on  January 1, 2004,  together
with  interest  accruing on  principal  at eight  percent  (8%) per annum,  plus
interest accruing each calendar quarter on the balance of interest accrued as of
(and including) the last day of the preceding  calendar quarter at eight percent
(8%) per annum,  and with all accrued interest payable with the principal sum on
January 1, 2004. The provisions on the back of this certificate are incorporated
as if set forth on the face of the certificate.


                                  Record Dates:
                                  The tenth day of the second month of the
                                  calendar quarter

DATED:

Authenticated to be one of the Debentures described in the Indenture referred to
herein:

THE BANK OF NEW YORK, as                    INTERVEST CORPORATION OF NEW YORK
  Registrar

By:                                         By:
    ---------------------  (Seal)             ---------------------
     Authorized Signatory                         President

                                            By:
                                               ---------------------
                                                  Secretary

                                       A-1


<PAGE>



                             (REVERSE OF DEBENTURE)

            Series 9/18/00 Subordinated Debenture due January 1, 2004

                  1.  Interest.  The Company  promises to  pay  interest on the
                      --------
principal  amount  of  this  Debenture  and  interest on  the  balance of unpaid
accrued  interest  at  the rate  per annum  shown above.  Interest  will  accrue
on principal  from the first closing date  on  which Debentures are approved for
authentication and issuance.

         All interest will accrue  quarterly but not be paid until maturity,  at
which  time all  unpaid  accrued  interest  will be  payable  together  with the
principal amount.  Interest on unpaid accrued interest will accrue each calendar
quarter based on the balance of unpaid  accrued  interest as of (and  including)
the last day of the preceding calendar quarter. Interest will be credited on the
first day of the calendar  quarter  following  the calendar  quarter in which it
accrued.  The first date on which  interest will accrue on the balance of unpaid
accrued  interest  shall be the first day of the first  calendar  quarter  after
interest on the principal balance commences accruing.  Interest will be computed
on the basis of a 360-day year consisting of twelve 30-day months.  For purposes
hereof,  January 1, April 1, July 1 and October 1 shall be the first days of the
calendar quarters.

                  2. Method of Payment.  Until maturity, the Company will accrue
                     -----------------
interest on the  Debentures  in each  calendar  quarter and reflect such accrued
interest  in its  records  for the  account of the  persons  who are  registered
holders of  Debentures  at the close of  business on the tenth day of the second
month of the calendar  quarter in which such interest is accruing.  Holders must
surrender Debentures to a Paying Agent to collect accrued interest and principal
payments.  The Company  will pay  principal  and interest in money of the United
States  that at the time of  payment is legal  tender for  payment of public and
private debts. The Company may, however, pay principal and interest by its check
payable in such money. It may mail payments to a holder's registered address.

                  3. Paying Agent and Registrar. Initially, the Company will act
                     ---------------------------
as Paying Agent.  The Bank of New York, a New York banking corporation, will act
as Registrar  and will  authenticate  the  Debentures.  The  Company may  change
any Paying  Agent, Registrar or co-Registrar without notice.

                  4.  Indenture.  This  Debenture  is one  of a duly  authorized
                      ---------
series  of  Debentures  issued by the  Company  under an  Indenture  dated as of
September  15,  2000 (the  "Indenture")  between the Company and The Bank of New
York, as trustee (the "Trustee"). The term "Debentures" being used herein refers
to all Maturities of Debentures  issued under the Indenture.  Capitalized  terms
herein  are  used  as  defined  in the  Indenture  unless  otherwise  indicated.
Reference  is hereby  made to the  Indenture  for a  description  of the rights,
obligations,  duties and immunities of the Trustee and the  Debentureholders and
for the terms and conditions upon which the Debentures are and are to be issued.
The Debentures are general  unsecured  obligations of the Company limited to the
aggregate  principal  amount of $3,750,000 of which a maximum of $1,250,000 will
have a maturity  date of January 1, 2004,  a maximum of  $1,250,000  will have a
maturity  date of  January  1, 2006,  and a maximum  of  $1,250,000  will have a
maturity date of January 1, 2008.




                                       A-2


<PAGE>



                  5. Optional  Redemption.  The Company may at its option redeem
                     --------------------
the  Debentures of any Maturity in whole or in part at any time.  The redemption
price of Debentures will be equal to (i) the face amount of the Debentures to be
redeemed plus a 1% premium if the  redemption  date is prior to January 1, 2002,
and (ii) the face amount of the Debentures to be redeemed if the redemption date
is on or after  January 1, 2002. In all cases,  the  Debenture  holder will also
receive interest accrued to the redemption date.

                  6. Selection and Notice of Redemption. If less than all of the
                     ----------------------------------
Debentures of any Maturity are to be redeemed,  the  Registrar  shall select the
Debentures  to be redeemed by such method as the  Registrar  shall deem fair and
appropriate,  or if the Debentures are listed on a national securities exchange,
in accordance  with the rules of such  exchange.  The  Registrar  shall make the
selection  from  the  Debentures  outstanding  and  not  previously  called  for
redemption.  The Registrar may select for redemption  portions (equal to $10,000
or any integral  multiple  thereof) of the principal  amount of Debentures  that
have denominations  larger than $10,000.  Provisions of the Indenture that apply
to Debentures  called for redemption also apply to portions of Debentures called
for  redemption.  Notice of  redemption  will be mailed at least 30 days but not
more than 90 days before the redemption  date to each holder of Debentures to be
redeemed at his registered  address.  On and after the redemption date, which is
the date  specified by the Company in its notice,  interest  ceases to accrue on
Debentures or portions thereof called for redemption.

                  7.  [INTENTIONALLY OMITTED]
                      -----------------------

                  8.  Denominations,  Transfer,  Exchange.  The  Debentures  are
                      -----------------------------------
issuable in  registered  form without  coupons in  denominations  of $10,000 and
integral multiples of $10,000.  A holder may transfer or exchange  Debentures in
accordance with the Indenture.  A Debenture containing a particular CUSIP Number
may not be  exchanged  for a Debenture  containing  another  CUSIP  Number.  The
Registrar  may require a holder,  among  other  things,  to furnish  appropriate
endorsements and transfer  documents,  and to pay any taxes and fees required by
law or permitted by the  Indenture.  The Registrar need not transfer or exchange
any Debenture or portion of a Debenture selected for redemption,  or transfer or
exchange any Debentures for a period of 15 days before a selection of Debentures
to be redeemed.

                  9    Persons  Deemed  Owners.    The  registered   holder of a
                       -----------------------
Debenture  may be treated as the owner of it for all purposes.

                  10.  Unclaimed Money. If money for the payment of principal or
                       ---------------
interest  remains  unclaimed for two years, the Trustee or Paying Agent will pay
the money back to the Company, if the Company requests such repayment within one
year  after such two year  period  that such money  remains  unclaimed.  If such
unclaimed money is so paid back to the Company, thereafter,  holders entitled to
the money must look to the Company for payment as general  creditors,  unless an
applicable  abandoned  property law designates another person. If such unclaimed
money is not so paid back to the  Company,  it may be disposed of by the Trustee
in accordance with applicable law.

                  11.  Amendment,  Supplement,  Waiver.    Subject   to  certain
                       -------------------------------
exceptions,  the  Indenture or the  Debentures  may be amended or  supplemented,
and any past default or compliance  with any  provision may be waived,  with the
consent of the holders of a  majority in  principal  amount of  the  outstanding
Debentures.  Without the consent of any  Debentureholder,  the Company may amend
or supplement the Indenture or the Debentures to cure any ambiguity,

                                       A-3


<PAGE>


omission, defect or inconsistency,  to comply with Article Five of the Indenture
(providing  for the  assumption  of the  obligations  of the  Company  under the
Indenture  by a  successor  corporation),  or to make any  change  that does not
adversely affect the rights of any Debentureholder.

                  12.  Defaults and Remedies.  The  Indenture  provides that the
                       ---------------------
Trustee will give the Debentureholders notice of an uncured Default known to it,
within 90 days after the  occurrence  of an Event of Default  (as defined in the
Indenture),  or as soon as  practicable  after it learns of an Event of  Default
which occurred more than 90 days beforehand;  provided that,  except in the case
of Default in the payment of principal  of or interest on any of the  Debentures
or any amount due on  redemption,  the Trustee may withhold such notice if it in
good faith  determines that the withholding of such notice is in the interest of
the Debentureholders.  In case an Event of Default occurs and is continuing, the
Trustee or the holders of not less than 25% of aggregate principal amount of the
Debentures  then  outstanding,  by notice in writing to the Company  (and to the
Trustee if given by the Debentureholders),  may declare the principal of and all
accrued interest on all the Debentures to be due and payable  immediately.  Such
declaration may be rescinded by holders of a majority in principal amount of the
Debentures if all existing Events of Default (except  nonpayment of principal or
interest that has become due solely because of the acceleration) have been cured
or waived and if the rescission  would not conflict with any judgment or decree.
The Indenture  requires the Company to file periodic reports with the Trustee as
to the absence of defaults.

                  13.  Subordination.  The indebtedness  evidenced by all of the
                       -------------
Debentures is, to the extent provided in the Indenture,  subordinate and subject
in right of payment to the prior payment in full of all Senior Indebtedness, and
this Debenture is issued subject to such  provisions of the Indenture,  and each
holder of this Debenture by accepting same, agrees to and shall be bound by such
provisions.  "Senior Indebtedness" means Indebtedness of the Company outstanding
at any time, whether outstanding on the date hereof or hereafter created,  which
(i) is secured, in whole or in part, by any asset or assets owned by the Company
or a Subsidiary,  or (ii) arises from unsecured borrowings by the Company from a
commercial  bank, a savings bank, a savings and loan  association,  an insurance
company, a company whose securities are traded in a national  securities market,
or any  wholly-owned  subsidiary of any of the  foregoing,  or (iii) arises from
unsecured  borrowings  by the Company  from any pension  plan (as defined in ss.
3(2) of the Employee  Retirement  Income  Security Act of 1974, as amended),  or
(iv) arises from  borrowings  by the Company  which are  evidenced by commercial
paper, or (v) other unsecured borrowings by the Company which are subordinate to
Indebtedness  of a type  described  in  clauses  (i),  (ii)  or (iv)  above  if,
immediately after the issuance thereof, the total capital,  surplus and retained
earnings of the Company exceed the aggregate of the outstanding principal amount
of such borrowings,  or (vi) is a guarantee or other liability of the Company of
or with respect to  Indebtedness  of a Subsidiary of a type  described in any of
clauses (ii), (iii) or (iv) above.

                  14.  Trustee  Dealings with the Company.  The Trustee,  in its
                       ----------------------------------
individual or any other  capacity,  may make loans to, accept deposits from, and
perform services for the Company or its Affiliates,  and may otherwise deal with
the Company or its Affiliates, as if it were not the Trustee.


                                       A-4


<PAGE>



                  15.      No Recourse Against  Others.   A  director,  officer,
                           ---------------------------
employee or  stockholder,  as such,  of the Company shall not have any liability
for any obligations  of the Company  under the  Debentures  or the  Indenture or
for any claim  based  on,  in  respect  of  or by reason  of,  such  obligations
or  their  creation.   Each  Debentureholder by  accepting  a  Debenture  waives
and releases  all  such  liability.  The  waiver  and  release  are  part of the
consideration for the issue of the Debentures.

                  16.      Authentication.    This   Debenture   shall   not  be
                           --------------
valid  until  the  Registrar  signs  the  certificate  of  authentication on the
 other side of this Debenture.

                  17.      Abbreviations.  Customary  abbreviations may  be used
                           -------------
in  the  name  of   the  Debentureholder  or  an  assignee,  such  as:   TEN COM
(=tenants in common),  TEN ENT  (=tenants by  entirety),  JT TEN (=joint tenants
with right of  survivorship  and not as tenants in common),   CUST (=custodian),
and U/G/M/A (=Uniform Gifts to Minors Act).

                  The Company will furnish to any  Debentureholder  upon written
request  and without  charge a copy of the  Indenture.  Requests  may be made to
Intervest  Corporation of New York, 10 Rockefeller  Plaza, Suite 1015, New York,
New York 10020-1903.





























                                       A-5


<PAGE>



                                   ASSIGNMENT


If you want to  assign  this  Debenture,  fill in the form  below  and have your
signature  guaranteed by a commercial  bank or trust company or a member firm of
any national securities exchange registered under the Securities Exchange Act of
1934.

I or we assign and transfer this Debenture to

----------------------------------------------------------------------
(Please insert assignee's social security or tax identification number)


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

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

----------------------------------------------
(Print or type assignee's name, address and zip code)

and irrevocably appoint
                       ---------------------------------------------------------
agent to transfer  this Debenture on  the  books  of the Company.  The agent may
substitute another to act for him.


Date:                     Your signature:
     -----------------                   -----------------------------------

                                         -----------------------------------
                                         (Sign  exactly as your name appears
                                         on the other side of this Debenture)


Signature Guarantee:
                    ------------------------











                                       A-6


<PAGE>



                                                                      Exhibit B
                                                                      ---------

THIS  DEBENTURE HAS NOT BEEN  REGISTERED  UNDER THE  SECURITIES ACT OF 1933 (THE
"ACT") OR UNDER ANY  APPLICABLE  STATE LAW AND MAY NOT BE  TRANSFERRED,  SOLD OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF EFFECTIVE  REGISTRATION UNDER THE ACT OR
AN  OPINION  OF  COUNSEL  REASONABLY  SATISFACTORY  TO  THE  COMPANY  THAT  SUCH
REGISTRATION  IS NOT  REQUIRED  UNDER  THE  ACT AND THE  RULES  AND  REGULATIONS
PROMULGATED THEREUNDER OR SUCH STATE SECURITIES LAW.

                            (FORM OF ACCRUAL DEBENTURE MATURING January 1, 2006)
Number R(         /06)A-                                                       $
         ---------

                        INTERVEST CORPORATION OF NEW YORK
            Series 9/18/00 Subordinated Debenture due January 1, 2006

                  INTERVEST   CORPORATION  OF  NEW  YORK,  a  corporation   duly
organized and existing under the laws of the State of New York (the  "Company"),
promises   to   pay   to  or   registered   assigns   the   principal   sum   of

----------------------------------------  Dollars on  January 1, 2006,  together
with interest  accruing on principal at eight and one-half  percent (8 1/2%) per
annum,  plus interest  accruing each calendar quarter on the balance of interest
accrued as of (and including) the last day of the preceding  calendar quarter at
eight and  one-half  percent (8 1/2%) per annum,  and with all accrued  interest
payable with the principal sum on January 1, 2006. The provisions on the back of
this  certificate  are  incorporated  as  if  set  forth  on  the  face  of  the
certificate.


                                  Record Dates:
                                  The tenth day of the second month of the
                                  calendar quarter

DATED:

Authenticated to be one of the Debentures described in the Indenture referred to
herein:

THE BANK OF NEW YORK, as                    INTERVEST CORPORATION OF NEW YORK
  Registrar

By:                                         By:
   --------------------- (Seal)                ------------------------
   Authorized Signatory                                President

                                            By:
                                               ------------------------
                                                       Secretary




                                       B-1


<PAGE>



                             (REVERSE OF DEBENTURE)

            Series 9/18/00 Subordinated Debenture due January 1, 2006

                  1.  Interest.   The  Company  promises  to pay interest on the
                      --------
principal amount of this Debenture and interest on the balance of unpaid accrued
interest at the rate per annum shown above.  Interest  will accrue on  principal
from the first closing date on which Debentures are  approved for authentication
and issuance.

         All interest will accrue  quarterly but not be paid until maturity,  at
which  time all  unpaid  accrued  interest  will be  payable  together  with the
principal amount.  Interest on unpaid accrued interest will accrue each calendar
quarter based on the balance of unpaid  accrued  interest as of (and  including)
the last day of the preceding calendar quarter. Interest will be credited on the
first day of the calendar  quarter  following  the calendar  quarter in which it
accrued.  The first date on which  interest will accrue on the balance of unpaid
accrued  interest  shall be the first day of the first  calendar  quarter  after
interest on the principal balance commences accruing.  Interest will be computed
on the basis of a 360-day year consisting of twelve 30-day months.  For purposes
hereof,  January 1, April 1, July 1 and October 1 shall be the first days of the
calendar quarters.

                  2. Method of Payment.  Until maturity, the Company will accrue
                     -----------------
interest on the  Debentures  in each  calendar  quarter and reflect such accrued
interest  in its  records  for the  account of the  persons  who are  registered
holders of  Debentures  at the close of  business on the tenth day of the second
month of the calendar  quarter in which such interest is accruing.  Holders must
surrender Debentures to a Paying Agent to collect accrued interest and principal
payments.  The Company  will pay  principal  and interest in money of the United
States  that at the time of  payment is legal  tender for  payment of public and
private debts. The Company may, however, pay principal and interest by its check
payable in such money. It may mail payments to a holder's registered address.

                  3. Paying Agent and  Registrar.  Initially,  the  Company will
                     ---------------------------
act as Paying Agent.  The Bank of New York, a New York banking corporation, will
act as Registrar  and will  authenticate the Debentures.  The Company may change
any Paying  Agent, Registrar or co-Registrar without notice.

                  4. Indenture.   This  Debenture  is one  of a duly  authorized
                     ---------
series  of  Debentures  issued by the  Company  under an  Indenture  dated as of
September  15,  2000 (the  "Indenture")  between the Company and The Bank of New
York, as trustee (the "Trustee"). The term "Debentures" being used herein refers
to all Maturities of Debentures  issued under the Indenture.  Capitalized  terms
herein  are  used  as  defined  in the  Indenture  unless  otherwise  indicated.
Reference  is hereby  made to the  Indenture  for a  description  of the rights,
obligations,  duties and immunities of the Trustee and the  Debentureholders and
for the terms and conditions upon which the Debentures are and are to be issued.
The Debentures are general  unsecured  obligations of the Company limited to the
aggregate  principal  amount of $3,750,000 of which a maximum of $1,250,000 will
have a maturity  date of January 1, 2004,  a maximum of  $1,250,000  will have a
maturity  date of  January  1, 2006,  and a maximum  of  $1,250,000  will have a
maturity date of January 1, 2008.


                                       B-2


<PAGE>

                  5. Optional  Redemption.  The Company may at its option redeem
                     --------------------
the  Debentures of any Maturity in whole or in part at any time.  The redemption
price for  Debentures  will be equal to (i) the face amount of the Debentures to
be  redeemed  plus a 1%  premium if the  redemption  date is prior to January 1,
2002,  and  (ii)  the  face  amount  of the  Debentures  to be  redeemed  if the
redemption  date is on or after  January 1, 2002.  In all cases,  the  Debenture
holder will also receive interest accrued to the redemption date.

                  6. Selection and Notice of Redemption. If less than all of the
                     ----------------------------------
Debentures of any Maturity are to be redeemed,  the  Registrar  shall select the
Debentures  to be redeemed by such method as the  Registrar  shall deem fair and
appropriate,  or if the Debentures are listed on a national securities exchange,
in accordance  with the rules of such  exchange.  The  Registrar  shall make the
selection  from  the  Debentures  outstanding  and  not  previously  called  for
redemption.  The Registrar may select for redemption  portions (equal to $10,000
or any integral  multiple  thereof) of the principal  amount of Debentures  that
have denominations  larger than $10,000.  Provisions of the Indenture that apply
to Debentures  called for redemption also apply to portions of Debentures called
for  redemption.  Notice of  redemption  will be mailed at least 30 days but not
more than 90 days before the redemption  date to each holder of Debentures to be
redeemed at his registered  address.  On and after the redemption date, which is
the date  specified by the Company in its notice,  interest  ceases to accrue on
Debentures or portions thereof called for redemption.

                  7. Optional Repurchase.  Commencing in the year 2004, a Holder
                     -------------------
will have the option to require the Company to purchase  the  Debenture  for the
face amount plus accrued  interest to the date of  repurchase,  provided  that a
request for  repurchase,  accompanied  by the  Debenture  and a written and duly
executed  instrument  of transfer is  submitted  to the Company no earlier  than
November 1 and no later than  November 30.  Repurchases  shall be made once each
year  as of  January  1 and  are  subject  to  the  limitations  set  out in the
Indenture,  including  the  limitation  that the  Company  is not  obligated  to
purchase,  on a non-cumulative  basis,  more than $100,000  aggregate  principal
amount of  Debentures  of any  maturity in any calendar  year.  The Company will
repurchase Debentures on a first-come first-served basis.

                  8.  Denominations,  Transfer,  Exchange.  The  Debentures  are
                      -----------------------------------
issuable in  registered  form without  coupons in  denominations  of $10,000 and
integral multiples of $10,000.  A holder may transfer or exchange  Debentures in
accordance with the Indenture.  A Debenture containing a particular CUSIP Number
may not be  exchanged  for a Debenture  containing  another  CUSIP  Number.  The
Registrar  may require a holder,  among  other  things,  to furnish  appropriate
endorsements and transfer  documents,  and to pay any taxes and fees required by
law or permitted by the  Indenture.  The Registrar need not transfer or exchange
any Debenture or portion of a Debenture selected for redemption,  or transfer or
exchange any Debentures for a period of 15 days before a selection of Debentures
to be redeemed.

                  9.  Persons  Deemed  Owners.   The  registered   holder  of  a
                      -----------------------
Debenture  may be treated as the owner of it for all purposes.

                  10. Unclaimed Money.  If money for the payment of principal or
                      ---------------
interest  remains  unclaimed for two years, the Trustee or Paying Agent will pay
the money back to the Company, if the Company requests such repayment within one
year  after such two year  period  that such money  remains  unclaimed.  If such
unclaimed money is so paid back to the Company, thereafter,  holders entitled to
the money must look to the Company for payment as general  creditors,  unless an
applicable abandoned property law designates another person. If such

                                       B-3


<PAGE>

unclaimed money is not so paid back to the Company, it may be disposed of by the
Trustee in accordance with applicable law.

                  11.  Amendment,   Supplement,   Waiver.   Subject  to  certain
                       ---------------------------------
exceptions, the Indenture or the Debentures may be amended or supplemented,  and
any past  default or  compliance  with any  provision  may be  waived,  with the
consent of the  holders of a majority  in  principal  amount of the  outstanding
Debentures. Without the consent of any Debentureholder, the Company may amend or
supplement  the  Indenture or the  Debentures to cure any  ambiguity,  omission,
defect or inconsistency, to comply with Article Five of the Indenture (providing
for the  assumption of the  obligations  of the Company under the Indenture by a
successor corporation), or to make any change that does not adversely affect the
rights of any Debentureholder.

                  12.  Defaults and Remedies.  The  Indenture  provides that the
                       ---------------------
Trustee will give the Debentureholders notice of an uncured Default known to it,
within 90 days after the  occurrence  of an Event of Default  (as defined in the
Indenture),  or as soon as  practicable  after it learns of an Event of  Default
which occurred more than 90 days beforehand;  provided that,  except in the case
of Default in the payment of principal  of or interest on any of the  Debentures
or any amount due on  redemption,  the Trustee may withhold such notice if it in
good faith  determines that the withholding of such notice is in the interest of
the Debentureholders.  In case an Event of Default occurs and is continuing, the
Trustee or the holders of not less than 25% of aggregate principal amount of the
Debentures  then  outstanding,  by notice in writing to the Company  (and to the
Trustee if given by the Debentureholders),  may declare the principal of and all
accrued interest on all the Debentures to be due and payable  immediately.  Such
declaration may be rescinded by holders of a majority in principal amount of the
Debentures if all existing Events of Default (except  nonpayment of principal or
interest that has become due solely because of the acceleration) have been cured
or waived and if the rescission  would not conflict with any judgment or decree.
The Indenture  requires the Company to file periodic reports with the Trustee as
to the absence of defaults.

                  13.  Subordination.  The indebtedness  evidenced by all of the
                       -------------
Debentures is, to the extent provided in the Indenture,  subordinate and subject
in right of payment to the prior payment in full of all Senior Indebtedness, and
this Debenture is issued subject to such  provisions of the Indenture,  and each
holder of this Debenture by accepting same, agrees to and shall be bound by such
provisions.  "Senior Indebtedness" means Indebtedness of the Company outstanding
at any time, whether outstanding on the date hereof or hereafter created,  which
(i) is secured, in whole or in part, by any asset or assets owned by the Company
or a Subsidiary,  or (ii) arises from unsecured borrowings by the Company from a
commercial  bank, a savings bank, a savings and loan  association,  an insurance
company, a company whose securities are traded in a national  securities market,
or any  wholly-owned  subsidiary of any of the  foregoing,  or (iii) arises from
unsecured  borrowings  by the Company  from any pension  plan (as defined in ss.
3(2) of the Employee  Retirement  Income  Security Act of 1974, as amended),  or
(iv) arises from  borrowings  by the Company  which are  evidenced by commercial
paper, or (v) other unsecured borrowings by the Company which are subordinate to
Indebtedness  of a type  described  in  clauses  (i),  (ii)  or (iv)  above  if,
immediately after the issuance thereof, the total capital,  surplus and retained
earnings of the Company exceed the aggregate of the outstanding principal amount
of such borrowings,  or (vi) is a guarantee or other liability of the Company of
or with respect to  Indebtedness  of a Subsidiary of a type  described in any of
clauses (ii), (iii) or (iv) above.

                                       B-4


<PAGE>

                  14.    Trustee  Dealings with the Company. The Trustee, in its
                         ----------------------------------
individual or any other  capacity,  may  make loans to,  accept  deposits  from,
and perform  services for the Company or its  Affiliates, and may otherwise deal
with the Company or its Affiliates, as if it were not the Trustee.

                  15.    No  Recourse  Against  Others.   A  director,  officer,
                         -----------------------------
employee or  stockholder,  as such, of the Company  shall not have any liability
for any obligations  of the Company  under the  Debentures  or the  Indenture or
for any claim  based  on,  in  respect  of  or by reason  of,  such  obligations
or their creation.  Each  Debentureholder by  accepting  a  Debenture waives and
releases  all  such  liability.    The  waiver  and  release  are  part  of  the
consideration  for the issue of the Debentures.

                  16.    Authentication.   This Debenture  shall  not  be  valid
                         --------------
until  the  Registrar  signs  the  certificate  of authentication  on  the other
side of this Debenture.

                  17.    Abbreviations.    Customary  abbreviations  may be used
                         -------------
in the  name  of  the   Debentureholder  or  an  assignee,  such  as:   TEN  COM
(=tenants in common), TEN ENT  (=tenants by  entirety),  JT TEN (=joint  tenants
with right of  survivorship  and not as  tenants in common),  CUST (=custodian),
and U/G/M/A (=Uniform Gifts to Minors Act).

                  The Company will furnish to any  Debentureholder  upon written
request  and without  charge a copy of the  Indenture.  Requests  may be made to
Intervest  Corporation of New York, 10 Rockefeller  Plaza, Suite 1015, New York,
New York 10020-1903.

























                                       B-5


<PAGE>



                                   ASSIGNMENT


If you want to  assign  this  Debenture,  fill in the form  below  and have your
signature  guaranteed by a commercial  bank or trust company or a member firm of
any national securities exchange registered under the Securities Exchange Act of
1934.

I or we assign and transfer this Debenture to

----------------------------------------------------------------------
(Please insert assignee's social security or tax identification number)


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

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

----------------------------------------------------
(Print or type assignee's name, address and zip code)

and irrevocably appoint
                       ---------------------------------------------------------
agent to  transfer this  Debenture on  the  books of the Company.  The agent may
substitute another to act for him.


Date:                        Your signature:
     ------------------                     ------------------------------


                                            ------------------------------
                                           (Sign  exactly  as your name  appears
                                            on the other side of this Debenture)


Signature Guarantee:
                    --------------------------











                                       B-6



<PAGE>



                                                                     Exhibit C
                                                                     ---------

THIS  DEBENTURE HAS NOT BEEN  REGISTERED  UNDER THE  SECURITIES ACT OF 1933 (THE
"ACT") OR UNDER ANY  APPLICABLE  STATE LAW AND MAY NOT BE  TRANSFERRED,  SOLD OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF EFFECTIVE  REGISTRATION UNDER THE ACT OR
AN  OPINION  OF  COUNSEL  REASONABLY  SATISFACTORY  TO  THE  COMPANY  THAT  SUCH
REGISTRATION  IS NOT  REQUIRED  UNDER  THE  ACT AND THE  RULES  AND  REGULATIONS
PROMULGATED THEREUNDER OR SUCH STATE SECURITIES LAW.

                            (FORM OF ACCRUAL DEBENTURE MATURING January 1, 2008)
Number R(                /08)A-                                               $
         ----------------

                        INTERVEST CORPORATION OF NEW YORK
            Series 9/18/00 Subordinated Debenture due January 1, 2008


                  INTERVEST   CORPORATION  OF  NEW  YORK,  a  corporation   duly
organized and existing under the laws of the State of New York (the  "Company"),
promises   to   pay   to  or   registered   assigns   the   principal   sum   of
                                          Dollars on  January 1, 2008,  together
------------------------------------------
with  interest  accruing  on  principal  at nine  percent  (9%) per annum,  plus
interest accruing each calendar quarter on the balance of interest accrued as of
(and including) the last day of the preceding  calendar  quarter at nine percent
(9%) per annum,  and with all accrued interest payable with the principal sum on
January 1, 2008. The provisions on the back of this certificate are incorporated
as if set forth on the face of the certificate.


                                  Record Dates:
                                  The tenth day of the second month of the
                                  calendar quarter

DATED:

Authenticated to be one of the
Debentures described in the
Indenture referred to herein:

THE BANK OF NEW YORK, as                    INTERVEST CORPORATION OF NEW YORK
  Registrar

By:                                     By:
   ------------------  (Seal)              ----------------------------
         Authorized Signatory                      President

                                        By:
                                           ----------------------------
                                                   Secretary


                                       C-1


<PAGE>



                             (REVERSE OF DEBENTURE)

            Series 9/18/00 Subordinated Debenture due January 1, 2008

                  1. Interest.   The Company  promises  to  pay  interest on the
                     --------
principal amount of this Debenture and interest on the balance of unpaid accrued
interest at the rate per annum shown above.  Interest  will accrue  on principal
from the first closing  date on which Debentures are approved for authentication
nd issuance.

         All interest will accrue  quarterly but not be paid until maturity,  at
which  time all  unpaid  accrued  interest  will be  payable  together  with the
principal amount.  Interest on unpaid accrued interest will accrue each calendar
quarter based on the balance of unpaid  accrued  interest as of (and  including)
the last day of the preceding calendar quarter. Interest will be credited on the
first day of the calendar  quarter  following  the calendar  quarter in which it
accrued.  The first date on which  interest will accrue on the balance of unpaid
accrued  interest  shall be the first day of the first  calendar  quarter  after
interest on the principal balance commences accruing.  Interest will be computed
on the basis of a 360-day year consisting of twelve 30-day months.  For purposes
hereof,  January 1, April 1, July 1 and October 1 shall be the first days of the
calendar quarters.

                  2. Method of Payment.  Until maturity, the Company will accrue
                     -----------------
interest on the  Debentures  in each  calendar  quarter and reflect such accrued
interest  in its  records  for the  account of the  persons  who are  registered
holders of  Debentures  at the close of  business on the tenth day of the second
month of the calendar  quarter in which such interest is accruing.  Holders must
surrender Debentures to a Paying Agent to collect accrued interest and principal
payments.  The Company  will pay  principal  and interest in money of the United
States  that at the time of  payment is legal  tender for  payment of public and
private debts. The Company may, however, pay principal and interest by its check
payable in such money. It may mail payments to a holder's registered address.

                  3. Paying Agent and  Registrar.   Initially,  the Company will
                     ---------------------------
act as Paying Agent.  The Bank of New York, a New York banking corporation, will
act as Registrar  and will  authenticate  the Debentures. The Company may change
any Paying  Agent, Registrar or co-Registrar without notice.

                  4. Indenture.   This  Debenture  is one  of a duly  authorized
                     ---------
series  of  Debentures  issued by the  Company  under an  Indenture  dated as of
September  15,  2000 (the  "Indenture")  between the Company and The Bank of New
York, as trustee (the "Trustee"). The term "Debentures" being used herein refers
to all Maturities of Debentures  issued under the Indenture.  Capitalized  terms
herein  are  used  as  defined  in the  Indenture  unless  otherwise  indicated.
Reference  is hereby  made to the  Indenture  for a  description  of the rights,
obligations,  duties and immunities of the Trustee and the  Debentureholders and
for the terms and conditions upon which the Debentures are and are to be issued.
The Debentures are general  unsecured  obligations of the Company limited to the
aggregate  principal  amount of $3,750,000 of which a maximum of $1,250,000 will
have a maturity  date of January 1, 2004,  a maximum of  $1,250,000  will have a
maturity  date of  January  1, 2006,  and a maximum  of  $1,250,000  will have a
maturity date of January 1, 2008.




                                       C-2


<PAGE>

                  5. Optional  Redemption.  The Company may at its option redeem
                     --------------------
the  Debentures of any Maturity in whole or in part at any time.  The redemption
price for Debentures  will be equal to: (i) the face amount of the Debentures to
be  redeemed  plus a 1%  premium if the  redemption  date is prior to January 1,
2002,  and  (ii)  the  face  amount  of the  Debentures  to be  redeemed  if the
redemption  date is on or after  January 1, 2002.  In all cases,  the  Debenture
holder will also receive interest accrued to the redemption date.

                  6. Selection and Notice of Redemption. If less than all of the
                     ----------------------------------
Debentures of any Maturity are to be redeemed,  the  Registrar  shall select the
Debentures  to be redeemed by such method as the  Registrar  shall deem fair and
appropriate,  or if the Debentures are listed on a national securities exchange,
in accordance  with the rules of such  exchange.  The  Registrar  shall make the
selection  from  the  Debentures  outstanding  and  not  previously  called  for
redemption.  The Registrar may select for redemption  portions (equal to $10,000
or any integral  multiple  thereof) of the principal  amount of Debentures  that
have denominations  larger than $10,000.  Provisions of the Indenture that apply
to Debentures  called for redemption also apply to portions of Debentures called
for  redemption.  Notice of  redemption  will be mailed at least 30 days but not
more than 90 days before the redemption  date to each holder of Debentures to be
redeemed at his registered  address.  On and after the redemption date, which is
the date  specified by the Company in its notice,  interest  ceases to accrue on
Debentures or portions thereof called for redemption.

                  7. Optional Repurchase.  Commencing in the year 2004, a Holder
                     -------------------
will have the option to require the Company to purchase  the  Debenture  for the
face amount plus accrued  interest to the date of  repurchase,  provided  that a
request for  repurchase,  accompanied  by the  Debenture  and a written and duly
executed  instrument  of transfer is  submitted  to the Company no earlier  than
November 1 and no later than  November 30.  Repurchases  shall be made once each
year  as of  January  1 and  are  subject  to  the  limitations  set  out in the
Indenture,  including  the  limitation  that the  Company  is not  obligated  to
purchase,  on a non-cumulative  basis,  more than $100,000  aggregate  principal
amount of  Debentures  of any  maturity in any calendar  year.  The Company will
repurchase Debentures on a first-come first-served basis.

                  8.  Denominations,  Transfer,  Exchange.  The  Debentures  are
                      -----------------------------------
issuable in  registered  form without  coupons in  denominations  of $10,000 and
integral multiples of $10,000.  A holder may transfer or exchange  Debentures in
accordance with the Indenture.  A Debenture containing a particular CUSIP Number
may not be  exchanged  for a Debenture  containing  another  CUSIP  Number.  The
Registrar  may require a holder,  among  other  things,  to furnish  appropriate
endorsements and transfer  documents,  and to pay any taxes and fees required by
law or permitted by the  Indenture.  The Registrar need not transfer or exchange
any Debenture or portion of a Debenture selected for redemption,  or transfer or
exchange any Debentures for a period of 15 days before a selection of Debentures
to be redeemed.

                  9.  Persons  Deemed  Owners.   The  registered   holder  of  a
                      -----------------------
Debenture  may be treated as the owner of it for all purposes.

                  10. Unclaimed Money.  If money for the payment of principal or
                      ---------------
interest  remains  unclaimed for two years, the Trustee or Paying Agent will pay
the money back to the Company, if the Company requests such repayment within one
year  after such two year  period  that such money  remains  unclaimed.  If such
unclaimed money is so paid back to the Company, thereafter,  holders entitled to
the money must look to the Company for payment as general

                                       C-3


<PAGE>

creditors,  unless an  applicable  abandoned  property  law  designates  another
person.  If such unclaimed  money is not so paid back to the Company,  it may be
disposed of by the Trustee in accordance with applicable law.

                  11.  Amendment,   Supplement,   Waiver.   Subject  to  certain
                       ---------------------------------
exceptions, the Indenture or the Debentures may be amended or supplemented,  and
any past  default or  compliance  with any  provision  may be  waived,  with the
consent of the  holders of a majority  in  principal  amount of the  outstanding
Debentures. Without the consent of any Debentureholder, the Company may amend or
supplement  the  Indenture or the  Debentures to cure any  ambiguity,  omission,
defect or inconsistency, to comply with Article Five of the Indenture (providing
for the  assumption of the  obligations  of the Company under the Indenture by a
successor corporation), or to make any change that does not adversely affect the
rights of any Debentureholder.

                  12.  Defaults and Remedies.  The  Indenture  provides that the
                       ---------------------
Trustee will give the Debentureholders notice of an uncured Default known to it,
within 90 days after the  occurrence  of an Event of Default  (as defined in the
Indenture),  or as soon as  practicable  after it learns of an Event of  Default
which occurred more than 90 days beforehand;  provided that,  except in the case
of Default in the payment of principal  of or interest on any of the  Debentures
or any amount due on  redemption,  the Trustee may withhold such notice if it in
good faith  determines that the withholding of such notice is in the interest of
the Debentureholders.  In case an Event of Default occurs and is continuing, the
Trustee or the holders of not less than 25% of aggregate principal amount of the
Debentures  then  outstanding,  by notice in writing to the Company  (and to the
Trustee if given by the Debentureholders),  may declare the principal of and all
accrued interest on all the Debentures to be due and payable  immediately.  Such
declaration may be rescinded by holders of a majority in principal amount of the
Debentures if all existing Events of Default (except  nonpayment of principal or
interest that has become due solely because of the acceleration) have been cured
or waived and if the rescission  would not conflict with any judgment or decree.
The Indenture  requires the Company to file periodic reports with the Trustee as
to the absence of defaults.

                  13.  Subordination.  The indebtedness  evidenced by all of the
                       -------------
Debentures is, to the extent provided in the Indenture,  subordinate and subject
in right of payment to the prior payment in full of all Senior Indebtedness, and
this Debenture is issued subject to such  provisions of the Indenture,  and each
holder of this Debenture by accepting same, agrees to and shall be bound by such
provisions.  "Senior Indebtedness" means Indebtedness of the Company outstanding
at any time, whether outstanding on the date hereof or hereafter created,  which
(i) is secured, in whole or in part, by any asset or assets owned by the Company
or a Subsidiary,  or (ii) arises from unsecured borrowings by the Company from a
commercial  bank, a savings bank, a savings and loan  association,  an insurance
company, a company whose securities are traded in a national  securities market,
or any  wholly-owned  subsidiary of any of the  foregoing,  or (iii) arises from
unsecured  borrowings  by the Company  from any pension  plan (as defined in ss.
3(2) of the Employee  Retirement  Income  Security Act of 1974, as amended),  or
(iv) arises from  borrowings  by the Company  which are  evidenced by commercial
paper, or (v) other unsecured borrowings by the Company which are subordinate to
Indebtedness  of a type  described  in  clauses  (i),  (ii)  or (iv)  above  if,
immediately after the issuance thereof, the total capital,  surplus and retained
earnings of the Company exceed the aggregate of the outstanding principal amount
of such borrowings,  or (vi) is a guarantee or other liability of the Company of
or with respect to  Indebtedness  of a Subsidiary of a type  described in any of
clauses (ii), (iii) or (iv) above.
                                       C-4


<PAGE>



                  14. Trustee  Dealings with the Company.  The Trustee,  in  its
                      ----------------------------------
individual or any other  capacity,  may  make loans  to, accept  deposits  from,
and perform  services for the  Company  or  its  Affiliates,  and  may otherwise
deal with the Company or its Affiliates, as if it were not the Trustee.

                  15. No Recourse Against Others.  A director, officer, employee
                      --------------------------
or  stockholder,  as such,  of the Company  shall not have any liability for any
obligations  of the Company  under the  Debentures  or the  Indenture or for any
claim  based on,  in  respect  of or by reason  of,  such  obligations  or their
creation.  Each Debentureholder by accepting a Debenture waives and releases all
such  liability.  The waiver and release are part of the  consideration  for the
issue of the Debentures.

                  16. Authentication.    This  Debenture  shall   not  be  valid
                      --------------
until  the  Registrar  signs  the  certificate  of  authentication  on the other
side of this Debenture.

                  17. Abbreviations.  Customary abbreviations may be used in the
                      -------------
name of the  Debentureholder  or  an  assignee,  such as:  TEN COM  (=tenants in
common),  TEN ENT  (=tenants by  entirety),  JT TEN (=joint  tenants  with right
of  survivorship  and not as  tenants in common), CUST (=custodian), and U/G/M/A
(=Uniform Gifts to Minors Act).

                  The Company will furnish to any  Debentureholder  upon written
request  and without  charge a copy of the  Indenture.  Requests  may be made to
Intervest  Corporation of New York, 10 Rockefeller  Plaza, Suite 1015, New York,
New York 10020-1903.

























                                       C-5


<PAGE>




                                   ASSIGNMENT


If you want to  assign  this  Debenture,  fill in the form  below  and have your
signature  guaranteed by a commercial  bank or trust company or a member firm of
any national securities exchange registered under the Securities Exchange Act of
1934.

I or we assign and transfer this Debenture to

----------------------------------------------------------
(Please insert assignee's social security or tax identification number)


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

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

----------------------------------------------
(Print or type assignee's name, address and zip code)

and irrevocably appoint
                       ---------------------------------------------------------
agent to transfer this  Debenture  on the books of the  Company.   The agent may
substitute another to act for him.


Date:                     Your signature:
     -------------------                 ------------------------


                                   ------------------------------
                                   (Sign  exactly  as your name  appears  on the
                                    other side of this Debenture)


Signature Guarantee:
                    -------------------------------










                                       C-6