<PAGE>

                                                                    EXHIBIT 4(a)

                               AVISTA CORPORATION

                                       TO

                         UNION BANK OF CALIFORNIA, N.A.,

                                     Trustee

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

                                    Indenture

                            DATED AS OF APRIL 1, 2004

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

<PAGE>

                               AVISTA CORPORATION
         RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT OF 1939 AND
                      INDENTURE, DATED AS OF APRIL 1, 2004

<TABLE>
<CAPTION>
TRUST INDENTURE ACT SECTION                                                                          INDENTURE SECTION(S)
---------------------------                                                                          --------------------
<S>                                                                                                  <C>
Section 310(a)(1)            ................................................................            809
(a)(2)                       ................................................................            809
(a)(3)                       ................................................................            Not Applicable
(a)(4)                       ................................................................            Not Applicable
(b)                          ................................................................            808, 810
Section 311(a)               ................................................................            813
(b)                          ................................................................            813
(c)                          ................................................................            813
Section 312(a)               ................................................................            901
(b)                          ................................................................            901
(c)                          ................................................................            901
Section 313(a)               ................................................................            902
(b)                          ................................................................            902
(c)                          ................................................................            902
(d)                          ................................................................            902
Section 314(a)               ................................................................            902, 507
(b)                          ................................................................            Not Applicable
(c)(1)                       ................................................................            102
(c)(2)                       ................................................................            102
(c)(3)                       ................................................................            Not Applicable
(d)                          ................................................................            Not Applicable
(e)                          ................................................................            102
Section 315(a)               ................................................................            801, 803
(b)                          ................................................................            802
(c)                          ................................................................            801
(d)                          ................................................................            801
(e)                          ................................................................            714
Section 316(a)               ................................................................            712, 713
(a)(1)(A)                    ................................................................            702, 712
(a)(1)(B)                    ................................................................            713
(a)(2)                       ................................................................            Not Applicable
(b)                          ................................................................            708
Section 317(a)(1)            ................................................................            703
(a)(2)                       ................................................................            705
(b)                          ................................................................            503
Section 318(a)               ................................................................            107
</TABLE>

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                           PAGE
                                                                                                                           ----
<S>                                                                                                                        <C>
Recital of the Company................................................................................................       1

  ARTICLE ONE.  DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
       SECTION 101. GENERAL DEFINITIONS...............................................................................       9
            ACT.......................................................................................................      10
            AFFILIATE.................................................................................................      10
            AUTHENTICATING AGENT......................................................................................      10
            AUTHORIZED OFFICER........................................................................................      10
            BOARD OF DIRECTORS........................................................................................      10
            BOARD RESOLUTION..........................................................................................      10
            BUSINESS DAY..............................................................................................      10
            COMMISSION................................................................................................      10
            COMMON SECURITIES.........................................................................................      11
            COMPANY...................................................................................................      11
            COMPANY ORDER or COMPANY REQUEST..........................................................................      11
            CORPORATE TRUST OFFICE....................................................................................      11
            CORPORATION...............................................................................................      11
            DECLARATION...............................................................................................      11
            DISCOUNT SECURITY.........................................................................................      11
            INTEREST..................................................................................................      11
            DOLLAR or $...............................................................................................      11
            ELIGIBLE OBLIGATIONS......................................................................................      11
            EVENT OF DEFAULT..........................................................................................      11
            FAIR VALUE................................................................................................      11
            GOVERNMENTAL AUTHORITY....................................................................................      12
            GOVERNMENT OBLIGATIONS....................................................................................      12
            HOLDER....................................................................................................      12
            INDENTURE.................................................................................................      12
            INDEPENDENT EXPERT'S CERTIFICATE..........................................................................      12
            INSTITUTIONAL TRUSTEE.....................................................................................      12
            INTEREST PAYMENT DATE.....................................................................................      12
            MATURITY..................................................................................................      12
            NOTICE OF DEFAULT.........................................................................................      13
            OFFICER'S CERTIFICATE.....................................................................................      13
            OPINION OF COUNSEL........................................................................................      13
            OUTSTANDING...............................................................................................      13
            PAYING AGENT..............................................................................................      14
            PERIODIC OFFERING.........................................................................................      14
            PERSON....................................................................................................      14
            PLACE OF PAYMENT..........................................................................................      14
</TABLE>

<PAGE>

<TABLE>
<S>                                                                                                                       <C>
          PREDECESSOR SECURITY......................................................................................      14
          PREFERRED SECURITIES......................................................................................      15
          REDEMPTION DATE...........................................................................................      15
          REDEMPTION PRICE..........................................................................................      15
          REGULAR RECORD DATE.......................................................................................      15
          REQUIRED CURRENCY.........................................................................................      15
          RESPONSIBLE OFFICER.......................................................................................      15
          SECURITIES................................................................................................      15
          SECURITY REGISTER.........................................................................................      15
          SECURITY REGISTRAR........................................................................................      15
          SENIOR INDEBTEDNESS.......................................................................................      15
          SPECIAL RECORD DATE.......................................................................................      16
          STATED INTEREST RATE......................................................................................      16
          STATED MATURITY...........................................................................................      16
          SUCCESSOR.................................................................................................      16
          TRANCHE...................................................................................................      16
          TRUST.....................................................................................................      16
          TRUSTEE...................................................................................................      16
          TRUST INDENTURE ACT.......................................................................................      16
          TRUST SECURITIES..........................................................................................      16
          TRUST SECURITIES GUARANTEE................................................................................      16
          UNITED STATES.............................................................................................      17
          UNPAID INTEREST...........................................................................................      17
     SECTION 102.  COMPLIANCE CERTIFICATES AND OPINIONS.............................................................      17
     SECTION 103.  CONTENT AND FORM OF DOCUMENTS DELIVERED TO TRUSTEE...............................................      17
     SECTION 104.  ACTS OF HOLDERS..................................................................................      19
     SECTION 105.  NOTICES, ETC. TO TRUSTEE OR COMPANY..............................................................      20
     SECTION 106.  NOTICE TO HOLDERS OF SECURITIES; WAIVER..........................................................      21
     SECTION 107.  CONFLICT WITH TRUST INDENTURE ACT................................................................      21
     SECTION 108.  EFFECT OF HEADINGS AND TABLE OF CONTENTS.........................................................      22
     SECTION 109.  SUCCESSORS AND ASSIGNS...........................................................................      22
     SECTION 110.  SEPARABILITY CLAUSE..............................................................................      22
     SECTION 111.  BENEFITS OF INDENTURE............................................................................      22
     SECTION 112.  GOVERNING LAW....................................................................................      22
     SECTION 113.  LEGAL HOLIDAYS...................................................................................      22

ARTICLE TWO.  SECURITY FORMS

     SECTION 201.  FORMS GENERALLY..................................................................................      23

ARTICLE THREE.  THE SECURITIES

     SECTION 301.  AMOUNT UNLIMITED; ISSUABLE IN SERIES.............................................................      24
     SECTION 302.  DENOMINATIONS....................................................................................      28
     SECTION 303.  EXECUTION, DATING, CERTIFICATE OF AUTHENTICATION.................................................      28
     SECTION 304.  TEMPORARY SECURITIES.............................................................................      31
</TABLE>

                                        4
<PAGE>

<TABLE>
<S>                                                                                                                       <C>
     SECTION 305.  REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE..............................................      31
     SECTION 306.  MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.................................................      33
     SECTION 307.  PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED...................................................      34
     SECTION 308.  PERSONS DEEMED OWNERS............................................................................      35
     SECTION 309.  CANCELLATION BY SECURITY REGISTRAR...............................................................      35
     SECTION 310.  COMPUTATION OF INTEREST..........................................................................      36
     SECTION 311.  PAYMENT TO BE IN PROPER CURRENCY.................................................................      36

ARTICLE FOUR.  REDEMPTION OF SECURITIES

     SECTION 401.  APPLICABILITY OF ARTICLE.........................................................................      36
     SECTION 402.  ELECTION TO REDEEM; NOTICE TO TRUSTEE............................................................      36
     SECTION 403.  SELECTION OF SECURITIES TO BE REDEEMED...........................................................      37
     SECTION 404.  NOTICE OF REDEMPTION.............................................................................      37
     SECTION 405.  SECURITIES PAYABLE ON REDEMPTION DATE............................................................      38
     SECTION 406.  SECURITIES REDEEMED IN PART......................................................................      39

ARTICLE FIVE.  COVENANTS

     SECTION 501.  PAYMENT OF SECURITIES............................................................................      39
     SECTION 502.  MAINTENANCE OF OFFICE OR AGENCY..................................................................      39
     SECTION 503.  MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST................................................      40
     SECTION 504.  CORPORATE EXISTENCE..............................................................................      41
     SECTION 505.  MAINTENANCE OF PROPERTIES........................................................................      42
     SECTION 506.  WAIVER OF CERTAIN COVENANTS......................................................................      42
     SECTION 507.  ANNUAL OFFICER'S CERTIFICATE AS TO COMPLIANCE....................................................      43
     SECTION 508.  RESTRICTION ON PAYMENT OF DIVIDENDS, ETC.........................................................      43
     SECTION 509.  AVA CAPITAL TRUST III............................................................................      44
     SECTION 510.  HOLDERS OF PREFERRED SECURITIES..................................................................      44

ARTICLE SIX.  SATISFACTION AND DISCHARGE

     SECTION 601.  SATISFACTION AND DISCHARGE OF SECURITIES.........................................................      44
     SECTION 602.  SATISFACTION AND DISCHARGE OF INDENTURE..........................................................      47
     SECTION 603.  APPLICATION OF TRUST MONEY.......................................................................      47

ARTICLE SEVEN.  EVENTS OF DEFAULT; REMEDIES

     SECTION 701.  EVENTS OF DEFAULT................................................................................      48
     SECTION 702.  ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT...............................................      50
     SECTION 703.  COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY TRUSTEE..................................      51
     SECTION 704.  APPLICATION OF MONEY COLLECTED...................................................................      51
     SECTION 705.  TRUSTEE MAY FILE PROOFS OF CLAIM.................................................................      52
     SECTION 706.  TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF SECURITIES......................................      53
     SECTION 707.  LIMITATION ON SUITS..............................................................................      53
     SECTION 708.  UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, PREMIUM AND INTEREST........................      54
     SECTION 709.  RESTORATION OF RIGHTS AND REMEDIES...............................................................      54
     SECTION 710.  RIGHTS AND REMEDIES CUMULATIVE...................................................................      54
</TABLE>

                                        5
<PAGE>

<TABLE>
<S>                                                                                                                       <C>
     SECTION 711.  DELAY OR OMISSION NOT WAIVER.....................................................................      55
     SECTION 712.  CONTROL BY HOLDERS OF SECURITIES.................................................................      55
     SECTION 713.  WAIVER OF PAST DEFAULTS..........................................................................      55
     SECTION 714.  UNDERTAKING FOR COSTS............................................................................      56
     SECTION 715.  WAIVER OF STAY OR EXTENSION LAWS.................................................................      56
     SECTION 716.  ACTION BY HOLDERS OF CERTAIN TRUST SECURITIES....................................................      56

ARTICLE EIGHT.  THE TRUSTEE

     SECTION 801.  CERTAIN DUTIES AND RESPONSIBILITIES..............................................................      57
     SECTION 802.  NOTICE OF DEFAULTS...............................................................................      58
     SECTION 803.  CERTAIN RIGHTS OF TRUSTEE........................................................................      59
     SECTION 804.  NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES...........................................      60
     SECTION 805.  MAY HOLD SECURITIES..............................................................................      60
     SECTION 806.  MONEY HELD IN TRUST..............................................................................      60
     SECTION 807.  COMPENSATION AND REIMBURSEMENT...................................................................      60
     SECTION 808.  DISQUALIFICATION; CONFLICTING INTERESTS..........................................................      61
     SECTION 809.  CORPORATE TRUSTEE REQUIRED; ELIGIBILITY..........................................................      61
     SECTION 810.  RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR................................................      62
     SECTION 811.  ACCEPTANCE OF APPOINTMENT BY SUCCESSOR...........................................................      64
     SECTION 812.  MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS......................................      65
     SECTION 813.  PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY................................................      65
     SECTION 814.  APPOINTMENT OF AUTHENTICATING AGENT..............................................................      66

ARTICLE NINE.  LISTS OF HOLDERS; REPORTS BY TRUSTEE AND COMPANY
     SECTION 901.  LISTS OF HOLDERS.................................................................................      68
     SECTION 902.  REPORTS BY TRUSTEE AND COMPANY...................................................................      68

ARTICLE TEN.  CONSOLIDATION, MERGER, CONVEYANCE OR OTHER TRANSFER

     SECTION 1001.  COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS............................................      69
     SECTION 1002.  SUCCESSOR SUBSTITUTED...........................................................................      69
     SECTION 1003.  RELEASE OF COMPANY UPON CONVEYANCE OR OTHER TRANSFER............................................      70
     SECTION 1004.  MERGER INTO COMPANY.............................................................................      70
     SECTION 1005.  TRANSFER OF LESS THAN THE ENTIRETY..............................................................      70

ARTICLE ELEVEN.  SUPPLEMENTAL INDENTURES

     SECTION 1101.  SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS..............................................      73
     SECTION 1102.  SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.................................................      75
     SECTION 1103.  EXECUTION OF SUPPLEMENTAL INDENTURES............................................................      77
     SECTION 1104.  EFFECT OF SUPPLEMENTAL INDENTURES...............................................................      77
     SECTION 1105.  CONFORMITY WITH TRUST INDENTURE ACT.............................................................      77
     SECTION 1106.  REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES..............................................      77
     SECTION 1107.  MODIFICATION WITHOUT SUPPLEMENTAL INDENTURE.....................................................      77

ARTICLE TWELVE.  MEETINGS OF HOLDERS; ACTION WITHOUT MEETING

     SECTION 1201.  PURPOSES FOR WHICH MEETINGS MAY BE CALLED.......................................................      78
</TABLE>

                                       6
<PAGE>

<TABLE>
<S>                                                                                                                       <C>
     SECTION 1202.  CALL, NOTICE AND PLACE OF MEETINGS..............................................................      78
     SECTION 1203.  PERSONS ENTITLED TO VOTE AT MEETINGS............................................................      79
     SECTION 1204.  QUORUM; ACTION..................................................................................      79
     SECTION 1205.  ATTENDANCE AT MEETINGS; DETERMINATION OF VOTING RIGHTS; CONDUCT AND ADJOURNMENT OF MEETINGS.....      80
     SECTION 1206.  COUNTING VOTES AND RECORDING ACTION OF MEETINGS.................................................      81
     SECTION 1207.  ACTION WITHOUT MEETING..........................................................................      81

ARTICLE THIRTEEN.  IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
     SECTION 1301.  LIABILITY SOLELY CORPORATE......................................................................      82

ARTICLE FOURTEEN.  SUBORDINATION OF SECURITIES

     SECTION 1401.  SECURITIES SUBORDINATE TO SENIOR INDEBTEDNESS...................................................      82
     SECTION 1402.  PAYMENT OVER OF PROCEEDS OF SECURITIES..........................................................      83
     SECTION 1403.  DISPUTES WITH HOLDERS OF CERTAIN SENIOR INDEBTEDNESS............................................      85
     SECTION 1404.  SUBROGATION.....................................................................................      85
     SECTION 1405.  OBLIGATION OF THE COMPANY UNCONDITIONAL.........................................................      85
     SECTION 1406.  PRIORITY OF SENIOR INDEBTEDNESS UPON MATURITY...................................................      86
     SECTION 1407.  TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS........................................................      86
     SECTION 1408.  NOTICE TO TRUSTEE TO EFFECTUATE SUBORDINATION...................................................      86
     SECTION 1409.  MODIFICATION, EXTENSION, ETC. OF SENIOR INDEBTEDNESS OF THE COMPANY.............................      87
     SECTION 1410.  TRUSTEE HAS NO FIDUCIARY DUTY TO HOLDERS OF SENIOR INDEBTEDNESS OF THE COMPANY..................      87
     SECTION 1411.  PAYING AGENTS OTHER THAN THE TRUSTEE............................................................      87
     SECTION 1412.  RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS NOT IMPAIRED...........................................      88
     SECTION 1413.  EFFECT OF SUBORDINATION PROVISIONS; TERMINATION.................................................      88

ARTICLE FIFTEEN.  EXCHANGE OF PREFERRED SECURITIES FOR SECURITIES

     SECTION 1501.  EXCHANGE OF PREFERRED SECURITIES FOR SECURITIES.................................................      88
</TABLE>

                                        7
<PAGE>

            INDENTURE, dated as of April 1, 2004 between AVISTA CORPORATION, a
corporation duly organized and existing under the laws of the State of
Washington (hereinafter sometimes called the "Company"), and UNION BANK OF
CALIFORNIA, N.A., a national banking association duly organized and existing
under the laws of the United States of America, as trustee (hereinafter
sometimes called the "Trustee").

                             RECITALS OF THE COMPANY

            The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
subordinated debentures, notes or other evidences of indebtedness (herein called
the "Securities"), to be issued in one or more series as contemplated herein;
and all acts necessary to make this Indenture a valid agreement of the Company
have been performed.

            NOW, THEREFORE, THIS INDENTURE WITNESSETH that in consideration of
the premises and of the purchase of the Securities by the Holders thereof, it is
hereby covenanted and agreed, for the equal and ratable benefit of all Holders
of the Securities or of series thereof (except as otherwise contemplated
herein), as follows:

                                   ARTICLE ONE

             DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

SECTION 101. GENERAL DEFINITIONS.

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

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

                  (b)   all terms used herein without definition which are
            defined in the Trust Indenture Act, either directly or by reference
            therein, have the meanings assigned to them therein;

                  (c)   all accounting terms not otherwise defined herein have
            the meanings assigned to them in accordance with generally accepted
            accounting principles in the United States, and, except as otherwise
            herein expressly provided, the term "generally accepted accounting
            principles" with respect to any computation required or permitted
            hereunder shall mean such accounting principles as are generally
            accepted in the United States at the date of such computation or, at
            the election of the Company, at the date of the execution and
            delivery of this Indenture;

                  (d)   any reference to an "Article" or a "Section" refers to
            an Article or a Section, as the case may be, of this Indenture; and

<PAGE>

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

            "ACT", when used with respect to any Holder of a Security, has the
meaning specified in Section 104.

            "AFFILIATE" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"CONTROL" when used with respect to any specified Person means the power to
direct generally the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms "CONTROLLING" and "CONTROLLED" have meanings
correlative to the foregoing.

            "AUTHENTICATING AGENT" means any Person (other than the Company or
any Affiliate thereof) authorized by the Trustee to act on behalf of the Trustee
to authenticate the Securities of one or more series.

            "AUTHORIZED OFFICER" means the Chairman of the Board, the President,
any Vice President, the Treasurer, any Assistant Treasurer or the Corporate
Secretary or any other duly authorized officer, agent or attorney-in-fact of the
Company named in an Officer's Certificate of the Company signed by any of the
aforesaid corporate officers.

            "BOARD OF DIRECTORS" means either the board of directors of the
Company or any committee thereof duly authorized to act in respect of matters
relating to this Indenture.

            "BOARD RESOLUTION" means a copy of a resolution certified by the
Corporate Secretary or an Assistant Corporate Secretary of the Company to have
been duly adopted by the Board of Directors of the Company and to be in full
force and effect on the date of such certification, and delivered to the
Trustee.

            "BUSINESS DAY", when used with respect to a Place of Payment or any
other particular location specified in the Securities or this Indenture, means
any day, other than a Saturday or Sunday, which is not a day on which banking
institutions or trust companies in such Place of Payment or other location are
generally authorized or required by law, regulation or executive order to remain
closed, except as may be otherwise specified as contemplated by Section 301.

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

                                       10
<PAGE>

            "COMMON SECURITIES" means any common trust interests issued by a
Trust or similar securities issued by permitted successors to such Trust in
accordance with the Declaration pertaining to such Trust.

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

            "COMPANY ORDER" or "COMPANY REQUEST" means, respectively, a written
order or request, as the case may be, signed in the name of the Company by an
Authorized Officer and delivered to the Trustee.

            "CORPORATE TRUST OFFICE" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office at the date of the execution and delivery of this
Indenture is located at 475 Sansome Street, 12th Floor, San Francisco,
California 94111.

            "CORPORATION" means a corporation, association, company, joint stock
company or business trust.

            "DECLARATION", with respect to a Trust, means the Declaration of
Trust establishing such Trust, as the same shall be amended and restated from
time to time.

            "DISCOUNT SECURITY" means any Security which provides for an amount
less than the principal amount thereof to be due and payable upon a declaration
of acceleration of the Maturity thereof pursuant to Section 702. "INTEREST" with
respect to a Discount Security means interest, if any, borne by such Security at
a Stated Interest Rate.

            "DOLLAR" or "$" means a dollar or other equivalent unit in such coin
or currency of the United States as at the time shall be legal tender for the
payment of public and private debts.

            "ELIGIBLE OBLIGATIONS" means:

                  (a)   with respect to Securities denominated in Dollars,
            Government Obligations; or

                  (b)   with respect to Securities denominated in a currency
            other than Dollars or in a composite currency, such other
            obligations or instruments as shall be specified with respect to
            such Securities as contemplated by Section 301.

            "EVENT OF DEFAULT" has the meaning specified in Section 701.

            "FAIR VALUE" has the meaning specified in Section 1005.

                                       11
<PAGE>

            "GOVERNMENTAL AUTHORITY" means the government of the United States
or of any State or Territory thereof or of the District of Columbia or of any
county, municipality or other political subdivision of any thereof, or any
department, agency, authority or other instrumentality of any of the foregoing.

            "GOVERNMENT OBLIGATIONS" means:

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

                  (b)   certificates, depositary receipts or other instruments
            which evidence a direct ownership interest in obligations described
            in clause (a) above or in any specific interest or principal
            payments due in respect thereof; provided, however, that the
            custodian of such obligations or specific interest or principal
            payments shall be a bank or trust company (which may include the
            Trustee or any Paying Agent) subject to Federal or State supervision
            or examination with a combined capital and surplus of at least Fifty
            Million Dollars ($50,000,000); and provided, further, that except as
            may be otherwise required by law, such custodian shall be obligated
            to pay to the holders of such certificates, depositary receipts or
            other instruments the full amount received by such custodian in
            respect of such obligations or specific payments and shall not be
            permitted to make any deduction therefrom.

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

            "INDENTURE" means this instrument as originally executed and
delivered and as it may from time to time be amended and/or supplemented by one
or more indentures or other instruments supplemental thereto or hereto entered
into pursuant to the applicable provisions hereof and shall include the terms of
particular series of Securities established as contemplated by Section 301.

            "INDEPENDENT EXPERT'S CERTIFICATE" has the meaning specified in
Section 1005.

            "INSTITUTIONAL TRUSTEE", with respect to a Trust, has the meaning
set forth in the Declaration establishing such Trust.

            "INTEREST PAYMENT DATE", when used with respect to any Security,
means the Stated Maturity of an installment of interest on such Security.

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

                                       12
<PAGE>

such Security or in this Indenture, whether at the Stated Maturity, by
declaration of acceleration, upon call for redemption or otherwise.

            "NOTICE OF DEFAULT" has the meaning specified in Section 701.

            "OFFICER'S CERTIFICATE" means a certificate signed by an Authorized
Officer of the Company and delivered to the Trustee.

            "OPINION OF COUNSEL" means a written opinion of counsel, who may be
counsel for the Company or other counsel acceptable to the Trustee and who may
be an employee or Affiliate of the Company.

            "OUTSTANDING", when used with respect to Securities, means, as of
the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:

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

                  (b)   Securities deemed to have been paid for all purposes of
            this Indenture in accordance with Section 601 (whether or not the
            Company's indebtedness in respect thereof shall be satisfied and
            discharged for any other purpose); and

                  (c)   Securities which have been paid pursuant to Section 306
            or in exchange for or in lieu of which other Securities have been
            authenticated and delivered pursuant to this Indenture, other than
            any such Securities in respect of which there shall have been
            presented to the Trustee proof satisfactory to it and the Company
            that such Securities are held by a bona fide purchaser or purchasers
            in whose hands such Securities are valid obligations of the Company;

provided, however, that in determining whether or not the Holders of the
requisite principal amount of the Securities Outstanding under this Indenture,
or the Outstanding Securities of any series or Tranche, have given any request,
demand, authorization, direction, notice, consent or waiver hereunder or whether
or not a quorum is present at a meeting of Holders of Securities,

                  (x)   Securities owned by the Company or any other obligor
            upon the Securities or any Affiliate of the Company or of such other
            obligor (unless the Company, such obligor or such Affiliate owns all
            Securities Outstanding under this Indenture, or all Outstanding
            Securities of each such series and each such Tranche, as the case
            may be, determined without regard to this clause (x)) shall be
            disregarded and deemed not to be Outstanding, except that, in
            determining whether the Trustee shall be protected in relying upon
            any such request, demand, authorization, direction, notice, consent
            or waiver or upon any such determination as to the presence of a
            quorum, only Securities which the Trustee knows to be so owned shall
            be so

                                       13
<PAGE>

            disregarded; provided, however, that Securities so owned which have
            been pledged in good faith may be regarded as Outstanding if it is
            established to the reasonable satisfaction of the Trustee that the
            pledgee, and not the Company, any such other obligor or Affiliate of
            either thereof, has the right so to act with respect to such
            Securities and that the pledgee is not the Company or any other
            obligor upon the Securities or any Affiliate of the Company or of
            such other obligor; and

                  (y)   the principal amount of a Discount Security that shall
            be deemed to be Outstanding for such purposes shall be the amount of
            the principal thereof that would be due and payable as of the date
            of such determination upon a declaration of acceleration of the
            Maturity thereof pursuant to Section 702; and

provided, further, that, in the case of any Security the principal of which is
payable from time to time without presentment or surrender, the principal amount
of such Security that shall be deemed to be Outstanding at any time for all
purposes of this Indenture shall be the original principal amount thereof less
the aggregate amount of principal thereof theretofore paid.

            "PAYING AGENT" means any Person, including the Company, authorized
by the Company to pay the principal of and premium, if any, or interest, if any,
on any Securities on behalf of the Company.

            "PERIODIC OFFERING" means an offering of Securities of a series from
time to time any or all of the specific terms of which Securities, including
without limitation the rate or rates of interest, if any, thereon, the Stated
Maturity or Maturities thereof and the redemption provisions, if any, with
respect thereto, are to be determined by the Company or its agents from time to
time subsequent to the initial request for the authentication and delivery of
such Securities by the Trustee, all as contemplated in Section 301 and clause
(b) of Section 303.

            "PERSON" means any individual, corporation, partnership, limited
liability partnership, limited liability company, joint venture, trust or
unincorporated organization or any Governmental Authority.

            "PLACE OF PAYMENT", when used with respect to the Securities of any
series, or any Tranche thereof, means the place or places, specified as
contemplated by Section 301, at which, subject to Section 502, principal of and
premium, if any, and interest, if any, on the Securities of such series or
Tranche are payable.

            "PREDECESSOR SECURITY" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 306 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed (to the
extent lawful) to evidence the same debt as the mutilated, destroyed, lost or
stolen Security.

                                       14
<PAGE>

            "PREFERRED SECURITIES" means any preferred trust interests issued by
a Trust or similar securities issued by permitted successors to such Trust in
accordance with the Declaration pertaining to such Trust.

            "REDEMPTION DATE", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.

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

            "REGULAR RECORD DATE" for the interest payable on any Interest
Payment Date on the Securities of any series means the date specified for that
purpose as contemplated by Section 301.

            "REQUIRED CURRENCY" has the meaning specified in Section 311.

            "RESPONSIBLE OFFICER", when used with respect to the Trustee, means
any officer of the Trustee assigned by the Trustee to administer its corporate
trust matters.

            "SECURITIES" means any bonds, notes and other evidences of
indebtedness authenticated and delivered under this Indenture.

            "SECURITY REGISTER" and "SECURITY REGISTRAR" have the respective
meanings specified in Section 305.

            "SENIOR INDEBTEDNESS" means, with respect to any Person (a)
indebtedness (including premium, if any, and interest, if any, thereon) of such
Person for money borrowed or for the deferred purchase price of property or
services in transactions not in the ordinary course of business; (b) all other
indebtedness (including premium, if any, and interest, if any, thereon)
evidenced by bonds, debentures, notes or other similar instruments (other than
Securities) issued by such Person; (c) all obligations of such Person under
lease agreements designating such Person as lessee, irrespective of the
treatment of any such lease agreement for accounting, tax or other purposes; (d)
all obligations of such Person for reimbursement (including premium, if any, and
interest, if any thereon) in respect of any letter of credit, banker's
acceptance, security purchase facility or similar credit transaction; (e) all
obligations of the character referred to in clauses (a) through (d) above of
other Persons for the payment of which such Person is responsible or liable as
obligor, guarantor or otherwise; and (f) all obligations of the character
referred to in clauses (a) through (d) above of other Persons secured by any
lien on any property or asset of such Person (whether or not such obligation is
assumed by such Person); provided, however, that Senior Indebtedness shall not
include (x) any such indebtedness that is by its terms subordinated to or pari
passu with the Securities; (y) any indebtedness between or among such Person and
its Affiliates, including all other debt securities and guarantees in respect of
such debt securities, issued to (i) any Trust or (ii) any other trust, or a
trustee of such trust, partnership or other entity which is a financing

                                       15
<PAGE>

vehicle of such Person in connection with the issuance by such financing vehicle
of preferred securities or (z) indebtedness for goods or materials purchased in
the ordinary course of business or for services obtained in the ordinary course
of business or indebtedness consisting of trade payables.

            "SPECIAL RECORD DATE" for the payment of any Unpaid Interest on the
Securities of any series means a date fixed by the Trustee pursuant to Section
307.

            "STATED INTEREST RATE" means a rate (whether fixed or variable) at
which an obligation by its terms is stated to bear simple interest. Any
calculation or other determination to be made under this Indenture by reference
to the Stated Interest Rate on an obligation shall be made (a) if the Company's
obligations in respect of any other indebtedness shall be evidenced or secured
in whole or in part by such obligation, by reference to the lower of the Stated
Interest Rate on such obligation and the Stated Interest Rate on such other
indebtedness and (b) without regard to the effective interest cost to the
Company of such obligation or of any such other indebtedness.

            "STATED MATURITY", when used with respect to any obligation or any
installment of principal thereof or interest thereon, means the date on which
the principal of such obligation or such installment of principal or interest is
stated to be due and payable (without regard to any provisions for redemption,
prepayment, acceleration, purchase or extension).

            "SUCCESSOR" has the meaning set forth in Section 1001.

            "TRANCHE" means a group of Securities which (a) are of the same
series and (b) have identical terms except as to principal amount and/or date of
issuance.

            "TRUST" means AVA Capital Trust III, a statutory trust established
under the laws of the State of Delaware, and any other Trust established for the
purpose of issuing securities upon the issuance and delivery to it of
Securities.

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

            "TRUST INDENTURE ACT" means, as of any time, the Trust Indenture Act
of 1939, or any successor statute, as in effect at such time.

            "TRUST SECURITIES", with respect to a Trust, means the securities
issued by such Trust, as established in the Declaration of such Trust.

            "TRUST SECURITIES GUARANTEE" means the Guarantee Agreement between
the Company, as Trust Securities Guarantor, and a guarantee trustee for the
benefit of the holders of Preferred Securities and Common Securities issued by
the Trust.

                                       16
<PAGE>

            "UNITED STATES" means the United States of America, its territories,
its possessions and other areas subject to its political jurisdiction.

            "UNPAID INTEREST" has the meaning specified in Section 307.

SECTION 102. COMPLIANCE CERTIFICATES AND OPINIONS.

            Except as otherwise expressly provided in this Indenture, upon any
application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall furnish to the Trustee an
Officer's Certificate stating that all conditions precedent, if any, provided
for in this Indenture relating to the proposed action have been complied with
and an Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with, it being understood that
in the case of any such application or request as to which the furnishing of
such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.

            Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:

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

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

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

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

SECTION 103. CONTENT AND FORM OF DOCUMENTS DELIVERED TO TRUSTEE.

            (a)   Any Officer's Certificate may be based (without further
examination or investigation), insofar as it relates to or is dependent upon
legal matters, upon an opinion of, or representations by, counsel, unless, in
any case, such officer has actual knowledge that the certificate or opinion or
representations with respect to the matters upon which such Officer's
Certificate may be based as aforesaid are erroneous.

                                       17
<PAGE>

            Any Opinion of Counsel may be based (without further examination or
investigation), insofar as it relates to or is dependent upon factual matters,
information with respect to which is in the possession of the Company, upon a
certificate of, or representations by, an officer or officers of the Company,
unless such counsel has actual knowledge that the certificate or opinion or
representations with respect to the matters upon which his opinion may be based
as aforesaid are erroneous. In addition, any Opinion of Counsel may be based
(without further examination or investigation), insofar as it relates to or is
dependent upon matters covered in an Opinion of Counsel rendered by other
counsel, upon such other Opinion of Counsel, unless such counsel has actual
knowledge that the Opinion of Counsel rendered by such other counsel with
respect to the matters upon which his Opinion of Counsel may be based as
aforesaid are erroneous. If, in order to render any Opinion of Counsel provided
for herein, the signer thereof shall deem it necessary that additional facts or
matters be stated in any Officer's Certificate provided for herein, then such
certificate may state all such additional facts or matters as the signer of such
Opinion of Counsel may request.

            (b)   In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents. Where (i) any
Person is required to make, give or execute two or more applications, requests,
consents, certificates, statements, opinions or other instruments under this
Indenture, or (ii) two or more Persons are each required to make, give or
execute any such application, request, consent, certificate, statement, opinion
or other instrument, any such applications, requests, consents, certificates,
statements, opinions or other instruments may, but need not, be consolidated and
form one instrument.

            (c)   Whenever, subsequent to the receipt by the Trustee of any
Board Resolution, Officer's Certificate, Opinion of Counsel or other document or
instrument, a clerical, typographical or other inadvertent or unintentional
error or omission shall be discovered therein, a new document or instrument may
be substituted therefor in corrected form with the same force and effect as if
originally filed in the corrected form and, irrespective of the date or dates of
the actual execution and/or delivery thereof, such substitute document or
instrument shall be deemed to have been executed and/or delivered as of the date
or dates required with respect to the document or instrument for which it is
substituted. Anything in this Indenture to the contrary notwithstanding, if any
such corrective document or instrument indicates that action has been taken by
or at the request of the Company which could not have been taken had the
original document or instrument not contained such error or omission, the action
so taken shall not be invalidated or otherwise rendered ineffective but shall be
and remain in full force and effect, except to the extent that such action was a
result of willful misconduct or bad faith. Without limiting the generality of
the foregoing, any Securities issued under the authority of such defective
document or instrument shall nevertheless be

                                       18
<PAGE>

the valid obligations of the Company entitled to the benefits provided by this
Indenture equally and ratably with all other Outstanding Securities, except as
aforesaid.

SECTION 104. ACTS OF HOLDERS.

            (a)   Any request, demand, authorization, direction, notice,
consent, election, waiver or other action provided by this Indenture to be made,
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 an agent duly appointed in writing or, alternatively, may be embodied in and
evidenced by the record of Holders voting in favor thereof, either in person or
by proxies duly appointed in writing, at any meeting of Holders duly called and
held in accordance with the provisions of Article Twelve, or a combination of
such instruments and any such record. Except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
or record or both are delivered to the Trustee and, where it is hereby expressly
required, to the Company. Such instrument or instruments and any such record
(and the action embodied therein and evidenced thereby) are herein sometimes
referred to as the "ACT" of the Holders signing such instrument or instruments
and so voting at any such meeting. Proof of execution of any such instrument or
of a writing appointing any such agent, or of the holding by any Person of a
Security, shall be sufficient for any purpose of this Indenture and (subject to
Section 801) conclusive in favor of the Trustee and the Company, if made in the
manner provided in this Section. The record of any meeting of Holders shall be
proved in the manner provided in Section 1206.

            (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 or may be
proved in any other manner which the Trustee and the Company deem sufficient.
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.

            (c)   The ownership, principal amount (except as otherwise
contemplated in clause (y) of the first proviso to the definition of
Outstanding) and serial numbers of Securities held by any Person, and the date
of holding the same, shall be proved by the Security Register.

            (d)   Any request, demand, authorization, direction, notice,
consent, election, waiver or other Act of a Holder shall bind every future
Holder of the same Security and the Holder of every Security 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 Security.

            (e)   Until such time as written instruments shall have been
delivered to the Trustee with respect to the requisite percentage of principal
amount of Securities for the action contemplated by such instruments, any such
instrument executed and delivered by or on behalf of a

                                       19
<PAGE>

Holder may be revoked with respect to any or all of such Securities by written
notice by such Holder or any subsequent Holder, proven in the manner in which
such instrument was proven.

            (f)   Securities of any series, or any Tranche thereof,
authenticated and delivered after any Act of Holders may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any action
taken by such Act of Holders. If the Company shall so determine, new Securities
of any series, or any Tranche thereof, so modified as to conform, in the opinion
of the Trustee and the Company, to such action may be prepared and executed by
the Company and authenticated and delivered by the Trustee in exchange for
Outstanding Securities of such series or Tranche.

            (g)   The Company may, at its option, by Company Order, fix in
advance a record date for the determination of Holders entitled to give any
request, demand, authorization, direction, notice, consent, waiver or other Act
solicited by the Company, but the Company shall have no obligation to do so;
provided, however, that the Company may not fix a record date for the giving or
making of any notice, declaration, request or direction referred to in the next
sentence. In addition, the Trustee may, at its option, fix in advance a record
date for the determination of Holders of Securities of any series entitled to
join in the giving or making of any Notice of Default, any declaration of
acceleration referred to in Section 702, any request to institute proceedings
referred to in Section 707 or any direction referred to in Section 712, in each
case with respect to Securities of such series. If any such record date is
fixed, such request, demand, authorization, direction, notice, consent, waiver
or other Act, or such notice, declaration, request or direction, may be given
before or after such record date, but only the Holders of record at the close of
business on the record date shall be deemed to be Holders for the purposes of
determining (i) whether Holders of the requisite proportion of the Outstanding
Securities have authorized or agreed or consented to such Act (and for that
purpose the Outstanding Securities shall be computed as of the record date)
and/or (ii) which Holders may revoke any such Act (notwithstanding subsection
(e) of this Section); and any such Act, given as aforesaid, shall be effective
whether or not the Holders which authorized or agreed or consented to such Act
remain Holders after such record date and whether or not the Securities held by
such Holders remain Outstanding after such record date.

SECTION 105. NOTICES, ETC. TO TRUSTEE OR COMPANY.

            Any request, demand, authorization, direction, notice, consent,
election, waiver or Act of Holders or other document provided or permitted by
this Indenture to be made upon, given or furnished to, or filed with, the
Trustee by any Holder or by the Company, or the Company by the Trustee or by any
Holder, shall be sufficient for every purpose hereunder (unless otherwise
expressly provided herein) if in writing and delivered personally to an officer
or other responsible employee of the addressee, or transmitted by facsimile
transmission, telex or other direct written electronic means to the telephone
number or other electronic communications address set forth for such party below
or otherwise as such party shall from time to time designate, or transmitted by
registered mail, charges prepaid, to the applicable address set forth for such
party below or to such other address as such party may from time to time
designate:

                                       20
<PAGE>

                  If to the Trustee, to:

                        Union Bank of California, N.A.
                        475 Sansome Street, 12th Floor
                        San Francisco, California 94111
                        Attention: Corporate Trust Department
                        Facsimile: (415) 296-6757

                  If to the Company, to:

                        Avista Corporation
                        1411 East Mission Avenue
                        Spokane, Washington 99202
                        Attention: Assistant Treasurer
                        Facsimile: (509) 482-4879

            Any communication contemplated herein shall be deemed to have been
made, given, furnished and filed if personally delivered, on the date of
delivery, if transmitted by facsimile transmission, telex or other direct
written electronic means, on the date of transmission, and if transmitted by
registered mail, on the date of receipt.

SECTION 106. NOTICE TO HOLDERS OF SECURITIES; WAIVER.

            Except as otherwise expressly provided herein, where this Indenture
provides for notice to Holders of any event, such notice shall be sufficiently
given, and shall be deemed given, to Holders if in writing and mailed,
first-class postage prepaid, to each Holder affected by such event, at the
address of such Holder as it appears in the Security Register, not later than
the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice.

            In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice to
Holders by mail, then such notification as shall be made with the approval of
the Trustee shall constitute a sufficient notification for every purpose
hereunder. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders.

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

SECTION 107. CONFLICT WITH TRUST INDENTURE ACT.

                                       21
<PAGE>

            If any provision of this Indenture limits, qualifies or conflicts
with another provision hereof which is required or deemed to be included in this
Indenture by, or is otherwise governed by, any provision of the Trust Indenture
Act, such other provision shall control; and if any provision hereof otherwise
conflicts with the Trust Indenture Act, the Trust Indenture Act shall control.

SECTION 108. EFFECT OF HEADINGS AND TABLE OF CONTENTS.

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

SECTION 109. SUCCESSORS AND ASSIGNS.

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

SECTION 110. SEPARABILITY CLAUSE.

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

SECTION 111. BENEFITS OF INDENTURE.

            Nothing in this Indenture or the Securities, express or implied,
shall give to any Person, other than the parties hereto, their successors
hereunder and the Holders and, to the extent provided in Sections 104(a) and
716, registered holders of Trust Securities (other than Trust Securities
initially issued and sold to the Company) and, so long as the notice described
in Section 1413 shall not have been given, holders of Senior Indebtedness, any
benefit or any legal or equitable right, remedy or claim under this Indenture,
provided, however, that so long as any Preferred Securities remain outstanding,
the holders of such Preferred Securities, subject to certain limitations set
forth in this Indenture, may enforce the Company's obligations hereunder,
directly against the Company, as third party beneficiaries of this Indenture
without proceeding against the Trust issuing such Preferred Securities.

SECTION 112. GOVERNING LAW.

            This Indenture and the Securities shall be governed by and construed
in accordance with the law of the State of New York (including without
limitation Section 5-1401 of the New York General Obligations Law or any
successor to such statute), except to the extent that the Trust Indenture Act
shall be applicable.

SECTION 113. LEGAL HOLIDAYS.

                                       22
<PAGE>

            In any case where any Interest Payment Date, Redemption Date or
Stated Maturity of any Security shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or of the
Securities other than a contrary provision in the Securities of any series, or
any Tranche thereof, or in the indenture supplemental hereto, Board Resolution
or Officer's Certificate which establishes the terms of the Securities of such
series or Tranche) payment of interest or principal and premium, if any, need
not be made at such Place of Payment on such date, but may be made on the next
succeeding Business Day at such Place of Payment with the same force and effect
as if made on the Interest Payment Date or Redemption Date, or at the Stated
Maturity, and, if such payment is made or duly provided for on such Business
Day, no interest shall accrue on the amount so payable for the period from and
after such Interest Payment Date, Redemption Date or Stated Maturity, as the
case may be, to such Business Day.

                                   ARTICLE TWO

                                 SECURITY FORMS

SECTION 201. FORMS GENERALLY.

            The definitive Securities of each series shall be in substantially
the form or forms established in the Officer's Certificate, the indenture
supplemental hereto or the Board Resolution establishing such series, in any
case with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such Securities, as evidenced by their execution thereof. If
the form or forms of Securities of any series are established in an Officer's
Certificate or a Board Resolution, such Officer's Certificate or Board
Resolution shall be delivered to the Trustee at or prior to the delivery of the
Company Order contemplated by Section 303 for the authentication and delivery of
such Securities.

            Unless otherwise specified as contemplated by Section 301 or
1101(f), the Securities of each series shall be issuable in registered form
without coupons. The definitive Securities shall be produced in such manner as
shall be determined by the officers executing such Securities, as evidenced by
their execution thereof.

SECTION 202. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.

            The Trustee's certificate of authentication shall be in
substantially the form set forth below:

                                       23
<PAGE>

                        This is one of the Securities of the series designated
                  therein referred to in the within-mentioned Indenture.

___________________________
                                                   as Trustee

                                                   By: _________________________
                                                       Authorized Officer

                                  ARTICLE THREE

                                 THE SECURITIES

SECTION 301. AMOUNT UNLIMITED; ISSUABLE IN SERIES.

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

            The Securities may be issued from time to time in one or more
series. Subject to the last paragraph of this Section, prior to the
authentication and delivery of Securities of any series there shall be
established by specification in an Officer's Certificate, a supplemental
indenture or in a Board Resolution:

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

                  (b)   any limit upon the aggregate principal amount of the
            Securities of such series which may be authenticated and delivered
            under this Indenture (except for Securities authenticated and
            delivered upon registration of transfer of, or in exchange for, or
            in lieu of, other Securities of such series pursuant to Section 304,
            305, 306, 406 or 1106 and except for any Securities which, pursuant
            to Section 303, are deemed never to have been authenticated and
            delivered hereunder);

                  (c)   the Persons (without specific identification) to whom
            interest, if any, on Securities of such series, or any Tranche
            thereof, shall be payable, if other than the Persons in whose names
            such Securities (or one or more Predecessor Securities) are
            registered at the close of business on the Regular Record Date for
            such interest;

                  (d)   the date or dates on which the principal of the
            Securities of such series, or any Tranche thereof, is payable or any
            formulary or other method or other means by which such date or dates
            shall be determined, by reference to an index or

                                       24
<PAGE>

            other fact or event ascertainable outside of this Indenture or
            otherwise (without regard to any provisions for redemption,
            prepayment, acceleration, purchase or extension); and the right, if
            any, to extend the Maturity of the Securities of such series, or any
            Tranche thereof, and the duration of any such extension;

                  (e)   the rate or rates at which the Securities of such
            series, or any Tranche thereof, shall bear interest, if any
            (including the rate or rates at which overdue principal shall bear
            interest, and the right, if any, to extend the interest payment
            periods and the duration of any such extension; if different from
            the rate or rates at which such Securities shall bear interest prior
            to Maturity, and, if applicable, the rate or rates at which overdue
            premium or interest shall bear interest, if any), or any formulary
            or other method or other means by which such rate or rates shall be
            determined by reference to an index or other fact or event
            ascertainable outside of this Indenture or otherwise; the date or
            dates from which such interest shall accrue; the Interest Payment
            Dates on which such interest shall be payable and the Regular Record
            Date, if any, for the interest payable on such Securities on any
            Interest Payment Date; the basis of computation of interest, if
            other than as provided in Section 310; and the right, if any, to
            extend the interest payment periods and the duration of any such
            extension;

                  (f)   the place or places at which and/or the methods (if
            other than as provided elsewhere in this Indenture) by which (i) the
            principal of and premium, if any, and interest, if any, on
            Securities of such series, or any Tranche thereof, shall be payable,
            (ii) registration of transfer of Securities of such series, or any
            Tranche thereof, may be effected, (iii) exchanges of Securities of
            such series, or any Tranche thereof, may be effected and (iv)
            notices and demands to or upon the Company in respect of the
            Securities of such series, or any Tranche thereof, and this
            Indenture may be served; the Security Registrar and any Paying Agent
            or Agents for such series or Tranche; and, if such is the case, that
            the principal of such Securities shall be payable without the
            presentment or surrender thereof;

                  (g)   the period or periods within which or the date or dates
            on which, the price or prices at which and the terms and conditions
            upon which the Securities of such series, or any Tranche thereof,
            may be redeemed, in whole or in part, at the option of the Company
            and any restrictions on such redemptions;

                  (h)   the obligation or obligations, if any, of the Company to
            redeem or purchase the Securities of such series, or any Tranche
            thereof, pursuant to any sinking fund or other mandatory redemption
            provisions or at the option of a Holder thereof and the period or
            periods within which or the date or dates on which, the price or
            prices at which and the terms and conditions upon which such
            Securities shall be redeemed or purchased, in whole or in part,
            pursuant to such obligation, and

                                       25
<PAGE>

            applicable exceptions to the requirements of Section 404 in the case
            of mandatory redemption or redemption at the option of the Holder;

                  (i)   the denominations in which Securities of such series, or
            any Tranche thereof, shall be issuable if other than denominations
            of One Thousand Dollars ($1,000) and any integral multiple thereof
            (in the case of Securities issued to a Trust or a trustee of such
            trust in connection with the issuance of Trust Securities by such
            Trust, the denomination in which such Securities shall be issuable
            if other than denominations of Twenty-Five Dollars ($25) and any
            integral multiple thereof);

                  (j)   the currency or currencies, including composite
            currencies, in which payment of the principal of or premium, if any,
            or interest, if any, on the Securities of such series, or any
            Tranche thereof, shall be payable (if other than in Dollars) and the
            formulary or other method or other means by which the equivalent of
            any such amount in Dollars is to be determined for any purpose,
            including for the purpose of determining the principal amount of
            such Securities deemed to be outstanding at any time;

                  (k)   if the principal of or premium, if any, or interest, if
            any, on the Securities of such series, or any Tranche thereof, are
            to be payable, at the election of the Company or a Holder thereof,
            in a coin or currency other than that in which the Securities are
            stated to be payable, the period or periods within which, and the
            terms and conditions upon which, such election may be made;

                  (l)   if the principal of or premium, if any, or interest, if
            any, on the Securities of such series, or any Tranche thereof, are
            to be payable, or are to be payable at the election of the Company
            or a Holder thereof, in securities or other property, the type and
            amount of such securities or other property, or the formulary or
            other method or other means by which such amount shall be
            determined, and the period or periods within which, and the terms
            and conditions upon which, any such election may be made;

                  (m)   if the amount payable in respect of the principal of or
            premium, if any, or interest, if any, on the Securities of such
            series, or any Tranche thereof, may be determined with reference to
            an index or other fact or event ascertainable outside of this
            Indenture, the manner in which such amounts shall be determined (to
            the extent not established pursuant to clause (e) of this
            paragraph);

                  (n)   if other than the entire principal amount thereof, the
            portion of the principal amount of Securities of such series, or any
            Tranche thereof, which shall be payable upon declaration of
            acceleration of the Maturity thereof pursuant to Section 702;

                                       26
<PAGE>

                  (o)   the terms, if any, pursuant to which the Securities of
            such series, or any Tranche thereof, may be converted into or
            exchanged for shares of capital stock or other securities of the
            Company or any other Person;

                  (p)   the obligations or instruments, if any, which shall be
            considered to be Eligible Obligations in respect of the Securities
            of such series, or any Tranche thereof, denominated in a currency
            other than Dollars or in a composite currency, and any additional or
            alternative provisions for the reinstatement of the Company's
            indebtedness in respect of such Securities after the satisfaction
            and discharge thereof as provided in Section 601;

                  (q)   if the Securities of such series, or any Tranche
            thereof, are to be issued in global form, (i) any limitations on the
            rights of the Holder or Holders of such Securities to transfer or
            exchange the same or to obtain the registration of transfer thereof,
            (ii) any limitations on the rights of the Holder or Holders thereof
            to obtain certificates therefor in definitive form in lieu of
            temporary form and (iii) any and all other matters incidental to
            such Securities;

                  (r)   if the Securities of such series, or any Tranche
            thereof, are to be issuable as bearer securities, any and all
            matters incidental thereto which are not specifically addressed in a
            supplemental indenture as contemplated by clause (f) of Section
            1101;

                  (s)   to the extent not established pursuant to clause (q) of
            this paragraph, any limitations on the rights of the Holders of the
            Securities of such Series, or any Tranche thereof, to transfer or
            exchange such Securities or to obtain the registration of transfer
            thereof; and if a service charge will be made for the registration
            of transfer or exchange of Securities of such series, or any Tranche
            thereof, the amount or terms thereof;

                  (t)   any exceptions to Section 113, or variation in the
            definition of Business Day, with respect to the Securities of such
            series, or any Tranche thereof; and

                  (u)   the designation of the Trust to which Securities of such
            series are to be issued;

                  (v)   any other terms of the Securities of such series, or any
            Tranche thereof.

            With respect to Securities of a series subject to a Periodic
Offering, the Officer's Certificate, the indenture supplemental hereto or the
Board Resolution which establishes such series, as the case may be, may provide
general terms or parameters for Securities of such series and

                                       27
<PAGE>

provide either that the specific terms of Securities of such series, or any
Tranche thereof, shall be specified in a Company Order or that such terms shall
be determined by the Company or its agents in accordance with procedures
specified in a Company Order as contemplated by clause (b) of Section 303.

            Unless otherwise specified with respect to a series of Securities as
contemplated by Section 301(b), any limit upon the aggregate principal amount of
a series of Securities may be increased without the consent of any Holders and
additional Securities of such series may be authenticated and delivered up to
the limit upon the aggregate principal amount authorized with respect to such
series as so increased.

            Anything herein to the contrary notwithstanding, the Trustee shall
be under no obligation to authenticate and deliver Securities of any series the
terms of which, established as contemplated by this Section, would affect the
rights, duties, obligations, liabilities or immunities of the Trustee under this
Indenture or otherwise.

SECTION 302. DENOMINATIONS.

            Unless otherwise provided as contemplated by Section 301 with
respect to any series of Securities, or any Tranche thereof, the Securities of
each series shall be issuable in denominations of One Thousand Dollars ($1,000)
and any integral multiple thereof (in the case of securities issued to a Trust
or a trustee of such trust in connection with the issuance of Trust Securities
by such Trust, the Securities of each series shall be issuable in denominations
of Twenty-Five Dollars ($25) and any integral multiple thereof).

SECTION 303. EXECUTION, DATING, AUTHENTICATION.

            Unless otherwise specified as contemplated by Section 301 with
respect to any series of Securities, or any Tranche thereof, the Securities
shall be executed on behalf of the Company by an Authorized Officer, and may
have the corporate seal of the Company affixed thereto or reproduced thereon and
attested by its Secretary, one of its Assistant Secretaries or any other
Authorized Officer. The signature of any or all of these officers on the
Securities may be manual or facsimile.

            Securities bearing the manual or facsimile signatures of individuals
who were at the time of execution Authorized Officers shall bind the Company,
notwithstanding that such individuals, or any of them, have ceased to be such
Authorized Officers prior to the authentication and delivery of such Securities
or were not such Authorized Officers at the date of such Securities.

            The Trustee shall authenticate and deliver Securities of a series,
for original issue, at one time or from time to time in accordance with the
Company Order referred to below, upon receipt by the Trustee of:

                                       28
<PAGE>

                  (a)   the instrument or instruments establishing the form or
            forms and terms of the Securities of such series, as provided in
            Sections 201 and 301;

                  (b)   a Company Order requesting the authentication and
            delivery of such Securities and, to the extent that the terms of
            such Securities shall not have been established in an Officer's
            Certificate, an indenture supplemental hereto or in a Board
            Resolution, all as contemplated by Sections 201 and 301, either (i)
            establishing such terms or (ii) in the case of Securities of a
            series subject to a Periodic Offering, specifying procedures,
            acceptable to the Trustee, by which such terms are to be established
            (which procedures may provide, to the extent acceptable to the
            Trustee, for authentication and delivery pursuant to oral or
            electronic instructions from the Company or any agent or agents
            thereof, which oral instructions are to be promptly confirmed
            electronically or in writing), in either case in accordance with the
            instrument or instruments delivered pursuant to clause (a) above;

                  (c)   the Securities of such series, each executed on behalf
            of the Company by an Authorized Officer;

                  (d)   an Opinion of Counsel to the effect that:

                        (i)   (A) the form or forms of such Securities have been
                  duly authorized by the Company and (B) the forms of such
                  Securities have been established in conformity with the
                  provisions of this Indenture;

                        (ii)  (A) the terms of such Securities have been duly
                  authorized by the Company and (B) the terms of such Securities
                  have been established in conformity with the provisions of
                  this Indenture; and

                        (iii) when such Securities shall have been authenticated
                  and delivered by the Trustee and issued and delivered by the
                  Company in the manner and subject to any conditions specified
                  in such Opinion of Counsel, such Securities will constitute
                  valid obligations of the Company, entitled to the benefits
                  provided by this Indenture equally and ratably with all other
                  Securities then Outstanding;

            provided, however, that, with respect to the Securities of a series
            subject to a Periodic Offering, the Trustee shall be entitled to
            receive such Opinion of Counsel only once at or prior to the time of
            the first authentication and delivery of the Securities of such
            series (provided that such Opinion of Counsel addresses the
            authentication and delivery of all Securities of such series) and
            that, in lieu of the opinions described in clauses (ii) and (iii)
            above, such Counsel may opine that:

                                       29
<PAGE>

                  (x)   when the terms of such Securities shall have been
            established pursuant to a Company Order or Orders or pursuant to
            such procedures as may be specified from time to time by a Company
            Order or Orders, all as contemplated by and in accordance with the
            instrument or instruments delivered pursuant to clause (a) above,
            such terms will have been duly authorized by the Company and will
            have been established in conformity with the provisions of this
            Indenture; and

                  (y)   when such Securities shall have been (1) authenticated
            and delivered by the Trustee in accordance with this Indenture and
            the Company Order or Orders or the specified procedures referred to
            in clause (x) above and (2) issued and delivered by the Company in
            the manner and subject to any conditions specified in such Opinion
            of Counsel, such Securities will constitute valid obligations of the
            Company, entitled to the benefits provided by this Indenture equally
            and ratably with all other Securities then Outstanding.

            With respect to Securities of a series subject to a Periodic
Offering, the Trustee may conclusively rely, as to the authorization by the
Company of any of such Securities, the forms and terms thereof, the validity
thereof and the compliance of the authentication and delivery thereof with the
terms and conditions of this Indenture, upon the Opinion or Opinions of Counsel
and the certificates and other documents delivered pursuant to this Article at
or prior to the time of the first authentication and delivery of Securities of
such series until any of such opinions, certificates or other documents have
been superseded or revoked or expire by their terms. In connection with the
authentication and delivery of Securities of a series subject to a Periodic
Offering, the Trustee shall be entitled to assume that the Company's
instructions to authenticate and deliver such Securities do not violate any
applicable law or any applicable rule, regulation or order of any Governmental
Authority having jurisdiction over the Company.

            If the form or terms of the Securities of any series have been
established by or pursuant to an Officer's Certificate or Board Resolution as
permitted by Sections 201 or 301, the Trustee shall not be required to
authenticate such Securities if the issuance of such Securities pursuant to this
Indenture will adversely affect the Trustee's own rights, duties or immunities
under the Securities and this Indenture or otherwise in a manner which is not
reasonably acceptable to the Trustee.

            Unless otherwise specified as contemplated by Section 301 with
respect to any series of Securities, or any Tranche thereof, each Security shall
be dated the date of the authentication of such Security.

            Unless otherwise specified as contemplated by Section 301 with
respect to any series of Securities, or any Tranche thereof, no Security shall
be entitled to any benefit under this Indenture or be valid or obligatory for
any purpose unless there appears on such Security a

                                       30
<PAGE>

certificate of authentication substantially in the form provided for herein
executed by the Trustee or an Authenticating Agent by manual signature of an
authorized officer thereof, and such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security has been duly
authenticated and delivered hereunder and is entitled to the benefits of this
Indenture. Notwithstanding the foregoing, if (a) any Security shall have been
authenticated and delivered hereunder to the Company, or any Person acting on
its behalf, but shall never have been issued and sold by the Company, (b) the
Company shall deliver such Security to the Security Registrar for cancellation
or shall cancel such Security and deliver evidence of such cancellation to the
Trustee, in each case as provided in Section 309, and (c) the Company, at its
election, shall deliver to the Trustee a written statement (which need not
comply with Section 102 and need not be accompanied by an Officer's Certificate
or an Opinion of Counsel) stating that such Security has never been issued and
sold by the Company, then, for all purposes of this Indenture, such Security
shall be deemed never to have been authenticated and delivered hereunder and
shall never be entitled to the benefits hereof.

SECTION 304. TEMPORARY SECURITIES.

            Pending the preparation of definitive Securities of any series, or
any Tranche thereof, the Company may execute, and upon Company Order the Trustee
shall authenticate and deliver, temporary Securities which are printed,
lithographed, typewritten, mimeographed, photocopied or otherwise produced, in
any authorized denomination, substantially of the tenor of the definitive
Securities in lieu of which they are issued, with such appropriate insertions,
omissions, substitutions and other variations as the officers executing such
Securities may determine, as evidenced by their execution of such Securities;
provided, however, that temporary Securities need not recite specific
redemption, sinking fund, conversion or exchange provisions.

            Except as otherwise specified as contemplated by Section 301 with
respect to the Securities of any series, or any Tranche thereof, after the
preparation of definitive Securities of such series or Tranche, the temporary
Securities of such series or Tranche shall be exchangeable, without charge to
the Holder thereof, for definitive Securities of such series or Tranche upon
surrender of such temporary Securities at the office or agency of the Company
maintained pursuant to Section 502 in a Place of Payment for such Securities.
Upon such surrender of temporary Securities, the Company shall, except as
aforesaid, execute and the Trustee shall authenticate and deliver in exchange
therefor definitive Securities of the same series and Tranche, of authorized
denominations and of like tenor and aggregate principal amount.

            Until exchanged in full as hereinabove provided, temporary
Securities shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities of the same series and Tranche and of like
tenor authenticated and delivered hereunder.

SECTION 305. REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE.

                                       31
<PAGE>

            The Company shall cause to be kept in one of the offices designated
pursuant to Section 502, with respect to the Securities of each series, or any
Tranche thereof, a register (the "SECURITY REGISTER") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities of such series or Tranche and the registration of
transfer thereof. The Company shall designate one Person to maintain the
Security Register for the Securities of each series and such Person is referred
to herein, with respect to such series, as the "SECURITY REGISTRAR". Anything
herein to the contrary notwithstanding, the Company may designate one or more of
its offices or an office of any Affiliate as an office in which a register with
respect to the Securities of one or more series, or any Tranche or Tranches
thereof, shall be maintained, and the Company may designate itself or any
Affiliate as the Security Registrar with respect to one or more of such series.
The Security Register shall be open for inspection by the Trustee and the
Company at all reasonable times.

            Except as otherwise specified as contemplated by Section 301 with
respect to the Securities of any series, or any Tranche thereof, upon
presentment for registration of transfer of any Security of such series or
Tranche at the office or agency of the Company maintained pursuant to Section
502 in a Place of Payment for such series or Tranche, and further upon
satisfaction of any conditions prescribed by applicable law, the Company shall
execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Securities of the same
series and Tranche, of authorized denominations and of like tenor and aggregate
principal amount.

            Except as otherwise specified as contemplated by Section 301 with
respect to the Securities of any series, or any Tranche thereof, any Security of
such series or Tranche may be exchanged at the option of the Holder, for one or
more new Securities of the same series and Tranche, of authorized denominations
and of like tenor and aggregate principal amount, upon presentment of the
Securities to be exchanged at any such office or agency. Whenever any Securities
are so presented for exchange and upon satisfaction of any conditions prescribed
by applicable law, the Company shall execute, and the Trustee shall authenticate
and deliver, the Securities which the Holder making the exchange is entitled to
receive.

            All Securities delivered upon any registration of transfer or
exchange of Securities shall be valid obligations of the Company, evidencing the
same respective obligations, and being entitled to the same benefits under this
Indenture, as the Securities presented upon such registration of transfer or
exchange.

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

                                       32
<PAGE>

            Unless otherwise specified as contemplated by Section 301 with
respect to Securities of any series, or any Tranche thereof, no service charge
shall be made for any registration of transfer or exchange of Securities, but
the Company may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Securities, other than exchanges pursuant to Section
304, 406 or 1106 not involving any transfer.

            The Company shall not be required to execute or to provide for the
registration of transfer of or the exchange of (a) Securities of any series, or
any Tranche thereof, during a period of fifteen (15) days immediately preceding
the date notice is to be given identifying the serial numbers of the Securities
of such series or Tranche called for redemption or (b) any Security so selected
for redemption in whole or in part, except the unredeemed portion of any
Security being redeemed in part.

SECTION 306. MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.

            If any mutilated Security is presented to the Trustee, the Company
shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and Tranche, and of like tenor and
principal amount and bearing a number not contemporaneously outstanding.

            If there shall be delivered to the Company and the Trustee (a)
evidence to their satisfaction of the ownership of and the destruction, loss or
theft of any Security and (b) such security or indemnity as may be reasonably
required by them to save each of them and any agent of any of them harmless,
then, in the absence of notice to the Company or the Trustee that such Security
is held by a Person deemed to be a protected purchaser under applicable law, the
Company shall execute and the Trustee shall authenticate and deliver, in lieu of
any such destroyed, lost or stolen Security, a new Security of the same series
and Tranche, and of like tenor and principal amount and bearing a number not
contemporaneously outstanding.

            Notwithstanding the foregoing, in case any such mutilated,
destroyed, lost or stolen Security has become or is about to become due and
payable, the Company in its discretion may, but subject to compliance with the
conditions set forth in the next preceding paragraph, instead of issuing a new
Security, pay such Security.

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

            Every new Security of any series issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security shall be at any time enforceable by

                                       33
<PAGE>

anyone other than the Holder of such new Security, and any such new Security
shall be entitled to all the benefits of this Indenture equally and ratably with
any and all other Securities of such series duly issued hereunder.

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

SECTION 307. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.

            Unless otherwise specified as contemplated by Section 301 with
respect to the Securities of any series, or any Tranche thereof, interest on any
Security which is payable, and is punctually paid or duly provided for, on any
Interest Payment Date shall be paid to the Person in whose name that Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest.

            Any interest on any Security of any series which is payable, but is
not punctually paid or duly provided for, on any Interest Payment Date,
including without limitation interest the payment period for which has been
extended as specified with respect to such series as contemplated by Section 301
(herein called "UNPAID INTEREST"), shall forthwith cease to be payable to the
Holder on the related Regular Record Date by virtue of having been such Holder,
and such Unpaid Interest may be paid by the Company, at its election in each
case, as provided in clause (a) or (b) below:

                  (a)   The Company may elect to make payment of any Unpaid
            Interest to the Persons in whose names the Securities of such series
            (or their respective Predecessor Securities) are registered at the
            close of business on a date (herein called a "SPECIAL RECORD DATE")
            for the payment of such Unpaid Interest, which shall be fixed in the
            following manner. The Company shall notify the Trustee in writing of
            the amount of Unpaid Interest proposed to be paid on each Security
            of such series and the date of the proposed payment, and at the same
            time the Company shall deposit with the Trustee an amount of money
            equal to the aggregate amount proposed to be paid in respect of such
            Unpaid Interest or shall make arrangements satisfactory to the
            Trustee for such deposit prior to the date of the proposed payment,
            such money when deposited to be held in trust for the benefit of the
            Persons entitled to such Unpaid Interest as in this clause provided.
            Thereupon the Trustee shall fix a Special Record Date for the
            payment of such Unpaid Interest which shall be not more than thirty
            (30) days and not less than ten (10) days prior to the date of the
            proposed payment and not less than twenty-five (25) days after the
            receipt by the Trustee of the notice of the proposed payment. The
            Trustee shall promptly notify the Company of such Special Record
            Date and, in the name and at the expense of the Company, shall, not
            less than fifteen (15) days prior to such Special Record Date, cause
            notice of the proposed payment of such Unpaid Interest and the
            Special Record

                                       34
<PAGE>

            Date therefor to be mailed, first-class postage prepaid, to each
            Holder of Securities of such series at the address of such Holder as
            it appears in the Security Register. Notice of the proposed payment
            of such Unpaid Interest and the Special Record Date therefor having
            been so mailed, such Unpaid Interest shall be paid to the Persons in
            whose names the Securities of such series (or their respective
            Predecessor Securities) are registered at the close of business on
            such Special Record Date.

                  (b)   The Company may make payment of any Unpaid Interest on
            the Securities of any series in any other lawful manner not
            inconsistent with the requirements of any securities exchange on
            which such Securities may be listed, and upon such notice as may be
            required by such exchange, if, after notice given by the Company to
            the Trustee of the proposed payment pursuant to this clause, such
            manner of payment shall be deemed practicable by the Trustee.

            Subject to the foregoing provisions of this Section and Section 305,
each Security delivered under this Indenture upon registration of transfer of or
in exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.

SECTION 308. PERSONS DEEMED OWNERS.

            Prior to the due presentment of any Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name such Security is registered as the absolute
owner of such Security (subject to Sections 305 and 307) for the purpose of
receiving payment of principal of and premium, if any, and interest, if any, on
such Security and for all other purposes whatsoever, whether or not such
Security be overdue, and neither the Company, nor the Trustee, or any agent of
the Company or the Trustee shall be affected by notice to the contrary.

SECTION 309. CANCELLATION BY SECURITY REGISTRAR.

            All Securities presented for payment, redemption, registration of
transfer or exchange shall, if presented to any Person other than the Security
Registrar, be delivered to the Security Registrar and, if not theretofore
canceled, shall be promptly canceled by the Security Registrar. The Company may
at any time deliver to the Security Registrar for cancellation any Securities
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever or which the Company shall not have issued and
sold, and all Securities so delivered shall be promptly canceled by the Security
Registrar. Unless by a Company Order the Company shall direct that canceled
Securities be returned to it, all canceled Securities held by the Security
Registrar shall be disposed of in accordance with the Security Registrar's
customary procedures. The Security Registrar shall promptly deliver to the
Company and the Trustee evidence of any cancellation by it of a Security, and of
any disposition by it of a canceled Security, in accordance with this Section
309 to the Trustee and the Company.

                                       35
<PAGE>

SECTION 310. COMPUTATION OF INTEREST.

            Except as otherwise specified as contemplated by Section 301 for
Securities of any series, or any Tranche thereof, interest on the Securities of
each series shall be computed on the basis of a three hundred sixty (360) day
year consisting of twelve (12) thirty (30) day months and, with respect to any
period less than a full calendar month, on the basis of the actual number of
days elapsed during such period.

SECTION 311. PAYMENT TO BE IN PROPER CURRENCY.

            In the case of the Securities of any series, or any Tranche thereof,
denominated in any currency other than Dollars or in a composite currency (the
"REQUIRED CURRENCY"), except as otherwise specified with respect to such
Securities as contemplated by Section 301, the obligation of the Company to make
any payment of the principal thereof, or the premium, if any, or interest, if
any, thereon, shall not be discharged or satisfied by any tender by the Company,
or recovery by the Trustee, in any currency other than the Required Currency,
except to the extent that such tender or recovery shall result in the Trustee
timely holding the full amount of the Required Currency then due and payable. If
any such tender or recovery is in a currency other than the Required Currency,
the Trustee may take such actions as it considers appropriate to exchange such
currency for the Required Currency. The costs and risks of any such exchange,
including without limitation the risks of delay and exchange rate fluctuation,
shall be borne by the Company and the Company shall remain fully liable for any
shortfall or delinquency in the full amount of Required Currency then due and
payable, and in no circumstances shall the Trustee be liable therefor except in
the case of its negligence or willful misconduct.

                                  ARTICLE FOUR

                            REDEMPTION OF SECURITIES

SECTION 401. APPLICABILITY OF ARTICLE.

            Securities of any series, or any Tranche thereof, which are
redeemable before their Stated Maturity shall be redeemable in accordance with
their terms and (except as otherwise specified as contemplated by Section 301
for Securities of such series or Tranche) in accordance with this Article.

SECTION 402. ELECTION TO REDEEM; NOTICE TO TRUSTEE.

            The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution or an Officer's Certificate. The Company shall,
at least forty-five (45) days prior to the Redemption Date fixed by the Company
(unless a shorter notice shall be satisfactory to the Trustee), notify the
Trustee and in the case of Securities of a Series held by a Trust, the
Institutional Trustee under the related Declaration establishing such Trust in
writing of such Redemption Date

                                       36
<PAGE>

and of the principal amount of such Securities to be redeemed. In the case of
any redemption of Securities (a) prior to the expiration of any restriction on
such redemption provided in the terms of such Securities or elsewhere in this
Indenture or (b) pursuant to an election of the Company which is subject to a
condition specified in the terms of such Securities, the Company shall furnish
the Trustee with an Officer's Certificate evidencing compliance with such
restriction or condition.

SECTION 403. SELECTION OF SECURITIES TO BE REDEEMED.

            If less than all the Securities of any series, or any Tranche
thereof, are to be redeemed, the particular Securities to be redeemed shall be
selected by the Security Registrar from the Outstanding Securities of such
series or Tranche not previously called for redemption, by such method as shall
be provided for such series or Tranche, or, in the absence of any such
provision, by such method of random selection as the Security Registrar shall
deem fair and appropriate and which may, in any case, provide for the selection
for redemption of portions (in any authorized denomination for Securities of
such series or Tranche) of the principal amount of Securities of such series or
Tranche having a denomination larger than the minimum authorized denomination
for Securities of such series or Tranche; provided, however, that if, as
indicated in an Officer's Certificate, the Company shall have offered to
purchase all or any principal amount of the Securities then Outstanding of any
series, or any Tranche thereof, and less than all of such Securities as to which
such offer was made shall have been tendered to the Company for such purchase,
the Security Registrar, if so directed by Company Order, shall select for
redemption all or any principal amount of such Securities which have not been so
tendered.

            The Security Registrar shall promptly notify the Company and the
Trustee in writing of the Securities selected for redemption and, in the case of
any Securities selected to be redeemed in part, the principal amount thereof to
be redeemed.

            For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.

SECTION 404. NOTICE OF REDEMPTION.

            Notice of redemption shall be given in the manner provided in
Section 106 to the Holders of the Securities to be redeemed not less than thirty
(30) nor more than sixty (60) days prior to the Redemption Date.

            All notices of redemption shall state:

                  (a)   the Redemption Date,

                  (b)   the Redemption Price,

                                       37
<PAGE>

                  (c)   if less than all the Securities of any series or Tranche
            are to be redeemed, the identification of the particular Securities
            to be redeemed and the portion of the principal amount of any
            Security to be redeemed in part,

                  (d)   that on the Redemption Date the Redemption Price,
            together with accrued interest, if any, to the Redemption Date, will
            become due and payable upon each such Security to be redeemed and,
            if applicable, that interest thereon will cease to accrue on and
            after said date,

                  (e)   the place or places where such Securities are to be
            surrendered for payment of the Redemption Price and accrued
            interest, if any, unless it shall have been specified as
            contemplated by Section 301 with respect to such Securities that
            such surrender shall not be required,

                  (f)   that the redemption is for a sinking or other fund, if
            such is the case, and

                  (g)   such other matters as the Company shall deem desirable
            or appropriate.

            With respect to any notice of redemption of Securities at the
election of the Company, unless, upon the giving of such notice, such Securities
shall be deemed to have been paid in accordance with Section 601, such notice
may state that such redemption shall be conditional upon the receipt by the
Paying Agent or Agents for such Securities, on or prior to the date fixed for
such redemption, of money sufficient to pay the principal of and premium, if
any, and interest, if any, on such Securities and that if such money shall not
have been so received such notice shall be of no force or effect and the Company
shall not be required to redeem such Securities. In the event that such notice
of redemption contains such a condition and such money is not so received, the
redemption shall not be made and within a reasonable time thereafter notice
shall be given, in the manner in which the notice of redemption was given, that
such money was not so received and such redemption was not required to be made,
and the Paying Agent or Agents for the Securities otherwise to have been
redeemed shall promptly return to the Holders thereof any of such Securities
which had been surrendered for payment upon such redemption.

            Notice of redemption of Securities to be redeemed at the election of
the Company, and any notice of non-satisfaction of a condition for redemption as
aforesaid, shall be given by the Company or, at the Company's Request, by the
Security Registrar in the name and at the expense of the Company. Notice of
mandatory redemption of Securities shall be given by the Security Registrar in
the name and at the expense of the Company.

SECTION 405. SECURITIES PAYABLE ON REDEMPTION DATE.

                                       38
<PAGE>

            Notice of redemption having been given as aforesaid, and the
conditions, if any, set forth in such notice having been satisfied, the
Securities or portions thereof so to be redeemed shall, on the Redemption Date,
become due and payable at the Redemption Price therein specified, and from and
after such date (unless, in the case of an unconditional notice of redemption,
the Company shall default in the payment of the Redemption Price and accrued
interest, if any) such Securities or portions thereof, if interest-bearing,
shall cease to bear interest. Upon surrender of any such Security for redemption
in accordance with such notice, such Security or portion thereof shall be paid
by the Company at the Redemption Price, together with accrued interest, if any,
to the Redemption Date; provided, however, that no such surrender shall be a
condition to such payment if so specified as contemplated by Section 301 with
respect to such Security; and provided, further, that, except as otherwise
specified as contemplated by Section 301 with respect to such Security, any
installment of interest on any Security the Stated Maturity of which installment
is on or prior to the Redemption Date shall be payable to the Holder of such
Security, or one or more Predecessor Securities, registered as such at the close
of business on the related Regular Record Date according to the terms of such
Security and subject to the provisions of Sections 305 and 307.

SECTION 406. SECURITIES REDEEMED IN PART.

            Upon the surrender of any Security which is to be redeemed only in
part at a Place of Payment therefor (with, if the Company or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company or the Trustee, as the case may be, duly executed
by, the Holder thereof or his attorney duly authorized in writing), the Company
shall execute, and the Trustee shall authenticate and deliver to the Holder of
such Security, without service charge, a new Security or Securities of the same
series and Tranche, of any authorized denomination requested by such Holder and
of like tenor and in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Security so surrendered.

                                  ARTICLE FIVE

                                    COVENANTS

SECTION 501. PAYMENT OF SECURITIES.

            The Company shall pay the principal of and premium, if any, and
interest, if any, on the Securities of each series in accordance with the terms
of such Securities and this Indenture.

SECTION 502. MAINTENANCE OF OFFICE OR AGENCY.

            The Company shall maintain in each Place of Payment for the
Securities of each series, or any Tranche thereof, an office or agency where
payment of such Securities shall be made, where the registration of transfer or
exchange of such Securities may be effected and where notices and demands to or
upon the Company in respect of such Securities and this Indenture may be served.
The Company shall give prompt written notice to the Trustee of the location, and
any

                                       39
<PAGE>

change in the location, of each such office or agency and prompt notice to the
Holders of any such change in the manner specified in Section 106. If at any
time the Company shall fail to maintain any such required office or agency in
respect of Securities of any series, or any Tranche thereof, or shall fail to
furnish the Trustee with the address thereof, payment of such Securities shall
be made, registration of transfer or exchange thereof may be effected and
notices and demands in respect thereof may be served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee as its agent
for all such purposes in any such event.

            The Company may also from time to time designate one or more other
offices or agencies with respect to the Securities of one or more series, or any
Tranche
thereof, for any or all of the foregoing purposes and may from time to time
rescind such designations; provided, however, that, unless otherwise specified
as contemplated by Section 301 with respect to the Securities of such series or
Tranche, no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency for such purposes in
each Place of Payment for such Securities in accordance with the requirements
set forth above. The Company shall give prompt written notice to the Trustee,
and prompt notice to the Holders in the manner specified in Section 106, of any
such designation or rescission and of any change in the location of any such
other office or agency.

            Anything herein to the contrary notwithstanding, any office or
agency required by this Section may be maintained at an office of the Company or
any Affiliate thereof, in which event the Company or such Affiliate, as the case
may be, shall perform all functions to be performed at such office or agency.

SECTION 503. MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST.

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

            Whenever the Company shall have one or more Paying Agents for the
Securities of any series, or any Tranche thereof, it shall, on or before each
due date of the principal of and premium, if any, and interest, if any, on such
Securities, deposit with such Paying Agents sums sufficient (without
duplication) to pay the principal and premium or interest so becoming due, such
sums to be held in trust for the benefit of the Persons entitled to such
principal, premium or interest, and (unless such Paying Agent is the Trustee)
the Company shall promptly notify the Trustee of any failure by it so to act.

                                       40
<PAGE>

            The Company shall cause each Paying Agent for the Securities of any
series, or any Tranche thereof, other than the Company or the Trustee, to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent shall:

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

                  (b)   give the Trustee notice of any failure by the Company
            (or any other obligor upon such Securities) to make any payment of
            principal of or premium, if any, or interest, if any, on such
            Securities; and

                  (c)   at any time during the continuance of any such failure,
            upon the written request of the Trustee, forthwith pay to the
            Trustee all sums so held in trust by such Paying Agent and furnish
            to the Trustee such information as it possesses regarding the names
            and addresses of the Persons entitled to such sums.

            The Company may at any time pay, or by Company Order direct any
Paying Agent to pay, to the Trustee all sums held in trust by the Company or
such Paying Agent, such sums to be held by the Trustee upon the same trusts as
those upon which such sums were held by the Company or such Paying Agent and, if
so stated in a Company Order delivered to the Trustee, in accordance with the
provisions of Article Six; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.

            Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of and premium,
if any, or interest, if any, on any Security and remaining unclaimed for two
years after such principal and premium, if any, or interest, if any, has become
due and payable shall be paid to the Company on Company Request, or, if then
held by the Company, shall be discharged from such trust; and, upon such payment
or discharge, the Holder of such Security shall, as an unsecured general
creditor and not as the Holder of an Outstanding Security, look only to the
Company for payment of the amount so due and payable and remaining unpaid
(subject, however, to the provisions of Article Fourteen), and all liability of
the Trustee or such Paying Agent with respect to such trust money, and all
liability of the Company as trustee thereof, shall thereupon cease; provided,
however, that the Trustee or such Paying Agent, before being required to make
any such payment to the Company, may at the expense of the Company cause to be
mailed, on one occasion only, notice to such Holder that such money remains
unclaimed and that, after a date specified therein, which shall not be less than
thirty (30) days from the date of such mailing, any unclaimed balance of such
money then remaining will be paid to the Company.

SECTION 504. CORPORATE EXISTENCE.

                                       41
<PAGE>

            Subject to the rights of the Company under Article Ten, the Company
shall do or cause to be done all things necessary to preserve and keep its
corporate existence in full force and effect.

SECTION 505. MAINTENANCE OF PROPERTIES .

            The Company shall cause (or, with respect to property owned in
common with others, make reasonable efforts to cause) all its properties used or
useful in the conduct of its businesses, considered as a whole, to be maintained
and kept in good condition, repair and working order and shall cause (or, with
respect to property owned in common with others, make reasonable effort to
cause) to be made such repairs, renewals, replacement, betterments and
improvements thereof, as, in the judgment of the Company, may be necessary in
order that the operation of such properties, considered as a whole, may be
conducted in accordance with common industry practice; provided, however, that
nothing in this section shall prevent the Company from discontinuing, or causing
the discontinuance of, the operation and maintenance of any of its properties;
and provided, further, that nothing in this Section shall prevent the Company
from selling, transferring or otherwise disposing of, or causing the sale,
transfer or other disposition of any of its properties.

SECTION 506. WAIVER OF CERTAIN COVENANTS.

            The Company may omit in any particular instance to comply with any
term, provision or condition set forth in

                  (a)   any covenant or restriction specified with respect to
            the Securities of any one or more series, or any Tranche or Tranches
            thereof, as contemplated by Section 301, or by Section 1201(b) if
            before the time for such compliance the Holders of a majority in
            aggregate principal amount of the Outstanding Securities of all
            series and Tranches with respect to which compliance with such
            covenant or restriction is to be omitted, considered as one class,
            shall, by Act of such Holders, either waive such compliance in such
            instance or generally waive compliance with such term, provision or
            condition; provided, however, that no such waiver shall be effective
            as to any matters contemplated in clause (a), (b) or (c) in Section
            1102 without consent of the Holders specified in such Section; and

                  (b)   Section 504 or Article Ten if before the time for such
            compliance the Holders of a majority in principal amount of
            Securities Outstanding under this Indenture shall, by Act of such
            Holders, either waive such compliance in such instance or generally
            waive compliance with such term, provision or condition;

but, in either case, no such waiver shall extend to or affect such term,
provision or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such term, provision or condition shall remain in
full force and effect; provided, however, so long as a Trust holds Securities of
any series,

                                       42
<PAGE>

such Trust may not waive compliance or waive any default in compliance by the
Company with any covenant or other term contained in this Indenture or the
Securities of such series without the approval of the holders of at least a
majority in aggregate liquidation preference of the outstanding Trust Securities
issued by such Trust, obtained as provided in the Declaration pertaining to such
Trust.

SECTION 507. ANNUAL OFFICER'S CERTIFICATE AS TO COMPLIANCE.

            Not later than December 1 in each year, commencing December 1, 2004,
the Company shall deliver to the Trustee an Officer's Certificate which need not
comply with Section 102, executed by the principal executive officer, the
principal financial officer or the principal accounting officer of the Company,
as to such officer's knowledge of the Company's compliance with all conditions
and covenants under this Indenture, such compliance to be determined without
regard to any period of grace or requirement of notice under this Indenture.

SECTION 508. RESTRICTION ON PAYMENT OF DIVIDENDS, ETC.

            So long as any preferred securities of any series remain
outstanding, if, at any time (a) there shall have occurred and be continuing an
Event of Default described in clause (a) or (b) of Section 701 with respect to
the Securities of any series, (b) the Company shall have elected to extend any
interest payment period as specified with respect to the Securities of any
series, or any Tranche thereof, as contemplated by Section 301 and any such
period, as so extended, shall be continuing, or (c) the Company shall be in
default in respect of its payment or other obligations under the Trust
Securities Guarantee relating to any Trust Securities (other than Trust
Securities initially issued and sold to the Company), then the Company shall not
(x) declare or pay any dividend on, make any distribution or liquidation payment
with respect to, or redeem, purchase or exchange any of its capital stock, (y)
make any payment of principal, premium, if any, or interest, if any, on or
repay, repurchase or redeem any debt securities (including other Securities)
that rank pari passu with or junior in right of payment to the Securities and
(z) make any guarantee payments with respect to any of the foregoing (other than
payments under the Trust Securities Guarantee); provided, however, that nothing
in this Section shall be deemed to prohibit (i) dividends or distributions
payable in shares of the Company's capital stock, or in the form of warrants,
options or other rights, where the dividend or distributed stock issuable upon
exercise of the warrants, options or other rights are the same stock as that on
which the dividend is being paid or is pari passu or junior to the stock, (ii)
reclassification of the Company's capital stock or exchange or conversion of
shares of one class or series of the Company's capital stock into shares of
another class or series of the Company's capital stock, (iii) purchases or other
acquisitions of fractional interests in shares of the Company's capital stock
pursuant to the conversion or exchange provisions of the capital stock or the
security being converted or exchanged; (iv) redemption, purchases or other
acquisitions of the Company's capital stock in connection with the satisfaction
by the Company of its obligations under provisions of the Company's Restated
Articles of Incorporation, as amended, under any direct purchase, dividend
reinvestment, customer purchase or employee benefit plans or under any contract
or security requiring the Company to purchase shares of its capital stock; and
(v) payments

                                       43
<PAGE>

under any Trust Securities Guarantee executed and delivered by the Company
concurrently with the issuance of any Preferred Securities.

SECTION 509. AVA CAPITAL TRUST III.

            If Securities of any series are issued and delivered to a Trust (or
a trustee thereof) in connection with the issuance by such trust of Trust
Securities, so long as such Trust Securities remain outstanding the Company
shall (a) maintain 100% direct ownership, by the Company or any Affiliate
thereof, of the Common Securities initially issued and sold to the Company by
such Trust, except as otherwise provided in Section 1005, and (b) use all
reasonable efforts to cause such Trust (i) to maintain its existence as a
business trust, except in connection with a distribution of Securities, with the
redemption, purchase or other acquisition and retirement of all Trust Securities
of such trust or with certain mergers, consolidations or other business
combinations, in each case as permitted by the Declaration establishing such
Trust, and (ii) to otherwise continue not to be treated as an association
taxable as a corporation for United States federal income tax purposes.

SECTION 510. HOLDERS OF PREFERRED SECURITIES

            The Company agrees that, for so long as any Preferred Securities
remain outstanding, its obligations under this Indenture will also be for the
benefit of the holders from time to time of Preferred Securities, and the
Company acknowledges and agrees that such holders will be entitled to enforce
this Indenture, as third party beneficiaries, directly against the Company to
the same extent as if such holders of Preferred Securities held a principal
amount of Securities equal to the stated liquidation preference of the Preferred
Securities held by such holders.

                                   ARTICLE SIX

                           SATISFACTION AND DISCHARGE

SECTION 601. SATISFACTION AND DISCHARGE OF SECURITIES.

            Any Security or Securities, or any portion of the principal amount
thereof, shall be deemed to have been paid for all purposes of this Indenture,
and the entire indebtedness of the Company in respect thereof shall be satisfied
and discharged, if there shall have been irrevocably deposited with the Trustee
or any Paying Agent (other than the Company), in trust:

                  (a)   money in an amount which shall be sufficient, or

                  (b)   in the case of a deposit made prior to the Maturity of
            such Securities or portions thereof, Eligible Obligations, which
            shall not contain provisions permitting the redemption or other
            prepayment thereof at the option of the issuer thereof, the
            principal of and the interest on which when due, without any regard
            to

                                       44
<PAGE>

            reinvestment thereof, will provide moneys which, together with the
            money, if any, deposited with or held by the Trustee or such Paying
            Agent, shall be sufficient, or

                  (c)   a combination of (a) or (b) which shall be sufficient,

to pay when due the principal of and premium, if any, and interest, if any, due
and to become due on such Securities or portions thereof; provided, however,
that in the case of the provision for payment or redemption of less than all the
Securities of any series or Tranche, such Securities or portions thereof shall
have been selected by the Security Registrar as provided herein and, in the case
of a redemption, the notice requisite to the validity of such redemption shall
have been given or irrevocable authority shall have been given by the Company to
the Trustee to give such notice, under arrangements satisfactory to the Trustee;
and provided, further, that the Company shall have delivered to the Trustee and
such Paying Agent:

                  (x)   if such deposit shall have been made prior to the
            Maturity of such Securities, a Company Order stating that the money
            and Eligible Obligations deposited in accordance with this Section
            shall be held in trust, as provided in Section 603;

                  (y)   if Eligible Obligations shall have been deposited, an
            Opinion of Counsel to the effect that such obligations constitute
            Eligible Obligations and do not contain provisions permitting the
            redemption or other prepayment thereof at the option of the issuer
            thereof, and an opinion of an independent public accountant of
            nationally recognized standing, selected by the Company, to the
            effect that the other requirements set forth in clause (b) and, if
            applicable, (c) above have been satisfied; and

                  (z)   if such deposit shall have been made prior to the
            Maturity of such Securities, an Officer's Certificate stating the
            Company's intention that, upon delivery of such Officer's
            Certificate, its indebtedness in respect of such Securities or
            portions thereof will have been satisfied and discharged as
            contemplated in this Section.

            Upon the deposit of money or Eligible Obligations, or both, in
accordance with this Section, together with the documents required by clauses
(x), (y) and (z) above, the Trustee shall, upon Company Request, acknowledge in
writing that such Securities or portions thereof are deemed to have been paid
for all purposes of this Indenture and that the entire indebtedness of the
Company in respect thereof has been satisfied and discharged as contemplated in
this Section. In the event that all of the conditions set forth in the preceding
paragraph shall have been satisfied in respect of any Securities or portions
thereof except that, for any reason, the Officer's Certificate specified in
clause (z) (if otherwise required) shall not have been delivered, such
Securities or portions thereof shall nevertheless be deemed to have been paid
for all purposes of this Indenture, and the Holders of such Securities or
portions thereof shall nevertheless be no longer entitled to the benefits
provided

                                       45
<PAGE>

by this Indenture or of any of the covenants of the Company under Article Five
(except the covenants contained in Sections 502 and 503) or any other covenants
made in respect of such Securities or portions thereof as contemplated by
Section 301 or Section 1201(b), but the indebtedness of the Company in respect
of such Securities or portions thereof shall not be deemed to have been
satisfied and discharged prior to Maturity for any other purpose; and, upon
Company Request, the Trustee shall acknowledge in writing that such Securities
or portions thereof are deemed to have been paid for all purposes of this
Indenture.

            If payment at Stated Maturity of less than all of the Securities of
any series, or any Tranche thereof, is to be provided for in the manner and with
the effect provided in this Section, the Security Registrar shall select such
Securities, or portions of principal amount thereof, in the manner specified by
Section 403 for selection for redemption of less than all the Securities of a
series or Tranche.

            In the event that Securities which shall be deemed to have been paid
for purposes of this Indenture, and, if such is the case, in respect of which
the Company's indebtedness shall have been satisfied and discharged, all as
provided in this Section, do not mature and are not to be redeemed within the
sixty (60) day period commencing with the date of the deposit of moneys or
Eligible Obligations, as aforesaid, the Company shall, as promptly as
practicable, give a notice, in the same manner as a notice of redemption with
respect to such Securities, to the Holders of such Securities to the effect that
such deposit has been made and the effect thereof.

            Notwithstanding that any Securities shall be deemed to have been
paid for purposes of this Indenture, as aforesaid, the obligations of the
Company and the Trustee in respect of such Securities under Sections 304, 305,
306, 404, 502, 503, 807 and 814 and this Article shall survive.

            The Company shall pay, and shall indemnify the Trustee or any Paying
Agent with which Eligible Obligations shall have been deposited as provided in
this Section against, any tax, fee or other charge imposed on or assessed
against such Eligible Obligations or the principal or interest received in
respect of such Eligible Obligations, including, but not limited to, any such
tax payable by any entity deemed, for tax purposes, to have been created as a
result of such deposit.

            Anything herein to the contrary notwithstanding, (a) if, at any time
after a Security would be deemed to have been paid for purposes of this
Indenture, and, if such is the case, the Company's indebtedness in respect
thereof would be deemed to have been satisfied and discharged, pursuant to this
Section (without regard to the provisions of this paragraph), the Trustee or any
Paying Agent, as the case may be, (i) shall be required to return the money or
Eligible Obligations, or combination thereof, deposited with it as aforesaid to
the Company or any representative thereof, under any applicable Federal or State
bankruptcy, insolvency or other similar law or (ii) are unable to apply any
money held by the Trustee as provided in this Section with respect to such
Security by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, such
Security shall thereupon be deemed retroactively not to have been paid and any
satisfaction and discharge of the Company's indebtedness in respect thereof

                                       46
<PAGE>

shall retroactively be deemed not to have been effected, and such Security shall
be deemed to remain Outstanding and (b) any satisfaction and discharge of the
Company's indebtedness in respect of any Security shall be subject to the
provisions of the last paragraph of Section 503.

SECTION 602. SATISFACTION AND DISCHARGE OF INDENTURE.

            This Indenture shall upon Company Request cease to be of further
effect (except as hereinafter expressly provided), and the Trustee, at the
expense of the Company, shall execute such instruments as the Company shall
reasonably request to evidence and acknowledge the satisfaction and discharge of
this Indenture, when:

                  (a)   no Securities remain Outstanding hereunder; and

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

provided, however, that if, in accordance with the last paragraph of Section
601, any Security, previously deemed to have been paid for purposes of this
Indenture, shall be deemed retroactively not to have been so paid, this
Indenture shall thereupon be deemed retroactively not to have been satisfied and
discharged, as aforesaid, and to remain in full force and effect, and the
Company shall execute and deliver such instruments as the Trustee shall
reasonably request to evidence and acknowledge the same.

            Notwithstanding the satisfaction and discharge of this Indenture as
aforesaid, the obligations of the Company and the Trustee under Sections 304,
305, 306, 404, 502, 503, 807 and 814 and this Article shall survive.

            Upon satisfaction and discharge of this Indenture as provided in
this Section, the Trustee shall turn over to the Company any and all money,
securities and other property then held by the Trustee for the benefit of the
Holders of the Securities (other than money and Eligible Obligations held by the
Trustee pursuant to Section 603) and shall execute and deliver to the Company
such instruments as, in the judgment of the Company, shall be necessary,
desirable or appropriate to effect or evidence the satisfaction and discharge of
this Indenture.

SECTION 603. APPLICATION OF TRUST MONEY.

            Neither the Eligible Obligations nor the money deposited pursuant to
Section 601, nor the principal or interest payments on any such Eligible
Obligations, shall be withdrawn or used for any purpose other than, and shall be
held in trust for, the payment of the principal of and premium, if any, and
interest, if any, on the Securities or portions of principal amount thereof in
respect of which such deposit was made, all subject, however, to the provisions
of Section 503; provided, however, that any cash received from such principal or
interest payments on such Eligible Obligations, if not then needed for such
purpose, shall, to the extent practicable and upon Company

                                       47
<PAGE>

Request and delivery to the Trustee of the documents referred to in clause (y)
in the first paragraph of Section 601, be invested in Eligible Obligations of
the type described in clause (b) in the first paragraph of Section 601 maturing
at such times and in such amounts as shall be sufficient, together with any
other moneys and the proceeds of any other Eligible Obligations then held by the
Trustee, to pay when due the principal of and premium, if any, and interest, if
any, due and to become due on such Securities or portions thereof on and prior
to the Maturity thereof, and interest earned from such reinvestment shall be
paid over to the Company as received, free and clear of any trust, lien or
pledge under this Indenture (except the lien provided by Section 807); and
provided, further, that any moneys held in accordance with this Section on the
Maturity of all such Securities in excess of the amount required to pay the
principal of and premium, if any, and interest, if any, then due on such
Securities shall be paid over to the Company free and clear of any trust, lien
or pledge under this Indenture (except the lien provided by Section 807); and
provided, further, that if an Event of Default shall have occurred and be
continuing, moneys to be paid over to the Company pursuant to this Section shall
be held until such Event of Default shall have been waived or cured.

                                  ARTICLE SEVEN

                           EVENTS OF DEFAULT; REMEDIES

SECTION 701. EVENTS OF DEFAULT.

            "EVENT OF DEFAULT", wherever used herein with respect to the
Securities of any series, means any of the following events which shall have
occurred and be continuing:

            (a)   failure to pay interest, if any, on any Security of such
      series within sixty (60) days after the same becomes due and payable
      (whether or not payment is prohibited by the provisions of Article
      Fourteen); provided, however, that no such failure shall constitute an
      "Event of Default" if the Company shall have made a valid extension of the
      interest payment period with respect to the Securities of such series if
      so provided with respect to such series as contemplated by Section 301; or

            (b)   failure to pay the principal of or premium, if any, on any
      Security of such series within three (3) Business Days after its Maturity
      (whether or not payment is prohibited by the provisions of Article
      Fourteen); provided, however, that no such failure shall constitute an
      "Event of Default" if the Company shall have made a valid extension of the
      Maturity of the Securities of such series if so provided with respect to
      such series as contemplated by Section 301; or

            (c)   failure to perform or breach of any covenant or warranty of
      the Company in this Indenture (other than a covenant or warranty a default
      in the performance of which or breach of which is elsewhere in this
      Section specifically dealt with or which has expressly been included in
      this Indenture solely for the benefit of one or more series of Securities

                                       48
<PAGE>

      other than such series) for a period of ninety (90) days after there has
      been given, by registered or certified mail, to the Company by the
      Trustee, or to the Company and the Trustee by the Holders of at least
      thirty-three per centum (33%) in principal amount of the Outstanding
      Securities of such series, a written notice specifying such default or
      breach and requiring it to be remedied and stating that such notice is a
      "NOTICE OF DEFAULT" hereunder, unless the Trustee, or the Trustee and the
      Holders of a principal amount of Securities of such series not less than
      the principal amount of Securities the Holders of which gave such notice,
      as the case may be, shall agree in writing to an extension of such period
      prior to its expiration; provided, however, that the Trustee, or the
      Trustee and the Holders of such principal amount of Securities of such
      series, as the case may be, shall be deemed to have agreed to an extension
      of such period if corrective action is initiated by the Company within
      such period and is being diligently pursued; or

            (d)   the entry by a court having jurisdiction in the premises of
      (i) a decree or order for relief in respect of the Company in an
      involuntary case or proceeding under any applicable Federal or State
      bankruptcy, insolvency, reorganization or other similar law or (ii) a
      decree or order adjudging the Company a bankrupt or insolvent, or
      approving as properly filed a petition by one or more Persons other than
      the Company seeking reorganization, arrangement, adjustment or composition
      of or in respect of the Company under any applicable Federal or State law,
      or appointing a custodian, receiver, liquidator, assignee, trustee,
      sequestrator or other similar official for the Company or for any
      substantial part of its property, or ordering the winding-up or
      liquidation of its affairs, and any such decree or order for relief or any
      such other decree or order shall have remained unstayed and in effect for
      a period of ninety (90) consecutive days; or

            (e)   the commencement by the Company of a voluntary case or
      proceeding under any applicable Federal or State bankruptcy, insolvency,
      reorganization or other similar law or of any other case or proceeding to
      be adjudicated a bankrupt or insolvent, or the consent by the Company to
      the entry of a decree or order for relief in respect of the Company in a
      case or proceeding under any applicable Federal or State bankruptcy,
      insolvency, reorganization or other similar law or to the commencement of
      any bankruptcy or insolvency case or proceeding against the Company, or
      the filing by the Company of a petition or answer or consent seeking
      reorganization or relief under any applicable Federal or State law, or the
      consent by the Company to the filing of such petition or to the
      appointment of or taking possession by a custodian, receiver, liquidator,
      assignee, trustee, sequestrator or similar official of the Company or of
      any substantial part of its property, or the making by the Company of an
      assignment for the benefit of creditors, or the admission by the Company
      in writing of its inability to pay its debts generally as they become due,
      or the authorization of such action by the Board of Directors of the
      Company; or

            (f)   if such Securities shall have been issued and delivered to a
      Trust (or trustee thereof) in connection with the issuance by such Trust
      of Trust Securities and so long as such Trust Securities remain
      outstanding, such Trust shall have voluntarily or involuntarily

                                       49
<PAGE>

      dissolved, wound up its business or otherwise terminated its existence
      except in connection with (i) the distribution of Securities to holders of
      Trust Securities in liquidation of their interests in such Trust; (ii) the
      redemption of all or the outstanding Trust Securities of such Trust or
      (iii) certain mergers, consolidations or other business combinations, each
      as permitted by the Declaration establishing such Trust, or

            (g)   any other Event of Default specified with respect to
      Securities of such series.

SECTION 702. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.

            If an Event of Default shall have occurred and be continuing with
respect to Securities of any series at the time Outstanding, then in every such
case the Trustee or the Holders of not less than thirty-three per centum (33%)
in principal amount of the Outstanding Securities of such series may declare the
principal amount (or, if any of the Securities of such series are Discount
Securities, such portion of the principal amount of such Securities as may be
specified in the terms thereof as contemplated by Section 301) of all of the
Outstanding Securities of such series to be due and payable immediately
(provided that the payment of principal and interest on such Securities shall
remain subordinated to the extent provided in this Indenture), by a notice in
writing to the Company (and to the Trustee if given by Holders), and upon
receipt by the Company of notice of such declaration such principal amount (or
specified amount), together with premium, if any, and accrued interest, if any,
thereon, shall become immediately due and payable; provided, however, that if an
Event of Default shall have occurred and be continuing with respect to more than
one series of Securities, the Trustee or the Holders of not less than
thirty-three per centum (33%) in aggregate principal amount of the Outstanding
Securities of all such series, considered as one class, may make such
declaration of acceleration, and not the Holders of the Securities of any one of
such series (provided that the payment of principal and interest on such
Securities shall remain subordinated to the extent provided in this Indenture).

            At any time after such a declaration of acceleration of the maturity
of the Securities of any series shall have been made, but before a judgment or
decree for payment of the money due shall have been obtained by the Trustee as
provided in this Article, the Event or Events of Default giving rise to such
declaration of acceleration shall, without further act, be deemed to have been
cured, and such declaration and its consequences shall, without further act, be
deemed to have been rescinded and annulled, if

                  (a)   the Company shall have paid or deposited with the
            Trustee a sum sufficient to pay

                        (i)   all overdue interest, if any, on all Securities of
                  such series then Outstanding;

                        (ii)  the principal of and premium, if any, on any
                  Securities of such series then Outstanding which have become
                  due otherwise than by such

                                       50
<PAGE>

                  declaration of acceleration and interest, if any, thereon at
                  the rate or rates prescribed therefor in such Securities;

                        (iii) interest, if any, upon overdue interest, if any,
                  at the rate or rates prescribed therefor in such Securities,
                  to the extent that payment of such interest is lawful; and

                        (iv)  all amounts due to the Trustee under Section 807;
                  and

                  (b)   all Event or Events of Default with respect to
            Securities of such series, other than the non-payment of the
            principal of Securities of such series which shall have become due
            solely by such declaration of acceleration, shall have been cured or
            waived as provided in Section 713.

No such rescission shall affect any subsequent Event of Default or impair any
right consequent thereon.

SECTION 703. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY TRUSTEE.

            If an Event of Default described in clause (a) or (b) of Section 701
shall have occurred and be continuing, the Company shall, upon demand of the
Trustee, pay to it, for the benefit of the Holders of the Securities of the
series with respect to which such Event of Default shall have occurred, the
whole amount then due and payable on such Securities for principal and premium,
if any, and interest, if any, and, in addition thereto, such further amount as
shall be sufficient to cover any amounts due to the Trustee under Section 807.

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

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

SECTION 704. APPLICATION OF MONEY COLLECTED.

            Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, to the extent permitted by law, at the date or
dates fixed by the Trustee and, in case

                                       51
<PAGE>

of the distribution of such money on account of principal or premium, if any, or
interest, if any, upon presentation of the Securities in respect of which or for
the benefit of which such money shall have been collected and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:

                  FIRST: To the payment of all amounts due the Trustee under
      Section 807;

                  SECOND: To the payment of the whole amount then due and unpaid
      upon the Outstanding Securities for principal and premium, if any, and
      interest, if any, in respect of which or for the benefit of which such
      money has been collected; and in case such proceeds shall be insufficient
      to pay in full the whole amount so due and unpaid upon such Securities,
      then to the payment of such principal and interest, if any, thereon
      without any preference or priority, ratably according to the aggregate
      amount so due and unpaid, with any balance then remaining to the payment
      of premium, if any, and, if so specified as contemplated by Section 301
      with respect to the Securities of any series, or any Tranche thereof,
      interest, if any, on overdue premium, if any, and overdue interest, if
      any, ratably as aforesaid, all to the extent permitted by applicable law;

                  THIRD: To the payment of the remainder, if any, to the Company
      or to whomsoever may be lawfully entitled to receive the same or as a
      court of competent jurisdiction may direct.

SECTION 705. TRUSTEE MAY FILE PROOFS OF CLAIM.

            In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise,

            (a)   to file and prove a claim for the whole amount of principal,
      premium, if any, and interest, if any, owing and unpaid in respect of the
      Securities and to file such other papers or documents as may be necessary
      or advisable in order to have the claims of the Trustee (including any
      claim for amounts due to the Trustee under Section 807) and of the Holders
      allowed in such judicial proceeding, and

            (b)   to collect and receive any moneys or other property payable or
      deliverable on any such claims and to distribute the same;

                                       52
<PAGE>

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amounts due it under Section 807.

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

SECTION 706. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF SECURITIES.

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

SECTION 707. LIMITATION ON SUITS.

            No Holder shall have any right to institute any proceeding, judicial
or otherwise, with respect to this Indenture, or for the appointment of a
receiver or trustee, or for any other remedy hereunder, unless:

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

            (b)   the Holders of a majority in aggregate principal amount of the
      Outstanding Securities of all series in respect of which an Event of
      Default shall have occurred and be continuing, considered as one class,
      shall have made written request to the Trustee to institute proceedings in
      respect of such Event of Default in its own name as Trustee hereunder;

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

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

            (e)   no direction inconsistent with such written request shall have
      been given to the Trustee during such sixty (60) day period by the Holders
      of a majority in aggregate

                                       53
<PAGE>

      principal amount of the Outstanding Securities of all series in respect of
      which an Event of Default shall have occurred and be continuing,
      considered as one class.

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

SECTION 708. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, PREMIUM AND
             INTEREST.

            Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and premium, if any, and (subject to
Sections 307) interest, if any, on such Security on the Stated Maturity or
Maturities expressed in such Security (or, in the case of redemption, on the
Redemption Date) and to institute suit for the enforcement of any such payment,
and such rights shall not be impaired without the consent of such Holder. In
addition, in the case of Securities of a series held by a Trust, a holder of
Preferred Securities may directly institute a proceeding against the Company for
enforcement of payment to such holder of principal of or interest on the
Securities having a principal amount equal to the aggregate liquidation
preference amount of the Preferred Securities of such holder on or after the due
dates specified or provided for in the Securities.

SECTION 709. RESTORATION OF RIGHTS AND REMEDIES.

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

SECTION 710. RIGHTS AND REMEDIES CUMULATIVE.

            Except as otherwise provided in the last paragraph of Section 306,
no right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.

                                       54
<PAGE>

SECTION 711. DELAY OR OMISSION NOT WAIVER.

            No delay or omission of the Trustee or of any Holder to exercise any
right or remedy accruing upon any Event of Default shall impair any such right
or remedy or constitute a waiver of any such Event of Default or an acquiescence
therein. Every right and remedy given by this Article or by law to the Trustee
or to the Holders may be exercised from time to time, and as often as may be
deemed expedient, by the Trustee or by the Holders, as the case may be.

SECTION 712. CONTROL BY HOLDERS OF SECURITIES.

            If an Event of Default shall have occurred and be continuing in
respect of a series of Securities, the Holders of a majority in principal amount
of the Outstanding Securities of such series shall have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred on the Trustee with
respect to the Securities of such series; provided, however, that if an Event of
Default shall have occurred and be continuing with respect to more than one
series of Securities, the Holders of a majority in aggregate principal amount of
the Outstanding Securities of all such series, considered as one class, shall
have the right to make such direction, and not the Holders of the Securities of
any one of such series; and provided, further, that

            (a)   such direction shall not be in conflict with any rule of law
      or with this Indenture, and could not involve the Trustee in personal
      liability in circumstances where indemnity would not, in the Trustee's
      sole discretion, be adequate,

            (b)   the Trustee may take any other action deemed proper by the
      Trustee which is not inconsistent with such direction.

SECTION 713. WAIVER OF PAST DEFAULTS.

            The Holders of not less than a majority in aggregate principal
amount of the Outstanding Securities of any series may on behalf of the Holders
of all the Securities of such series then outstanding waive any past default
with respect to such series hereunder and its consequences, except a default

            (a)   in the payment of the principal of or premium, if any, or
      interest, if any, on any Security of such series then outstanding, or

            (b)   in respect of a covenant or provision hereof which under
      Section 1102 cannot be modified or amended without the consent of the
      Holder of each Outstanding Security of such series affected; provided,
      however, that so long as a Trust holds the Securities of any series, such
      trust may not waive any past default without the consent of at least a
      majority in aggregate liquidation preference of the outstanding Trust
      Securities issued by such Trust, obtained as provided in the Declaration
      pertaining to such Trust. Any such waiver by

                                       55
<PAGE>

        holders of a majority in aggregate liquidation preference of outstanding
        Preferred Securities issued by any such Trust shall be deemed to be on
        behalf of all holders of Preferred Securities issued by any such Trust.

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

SECTION 714. UNDERTAKING FOR COSTS.

            The Company and the Trustee agree, and each Holder by its acceptance
of a Security shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant all in the
manner, to the extent and except as provided in the Trust Indenture Act; but the
provisions of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than ten per centum
(10%) in aggregate principal amount of the Outstanding Securities of all series
in respect of which such suit may be brought, considered as one class, or to any
suit instituted by any Holder for the enforcement of the payment of the
principal of or premium, if any, or interest, if any, on any Security on or
after the Stated Maturity or Maturities expressed in such Security (or, in the
case of redemption, on or after the Redemption Date).

SECTION 715. WAIVER OF STAY OR EXTENSION LAWS.

            To the full extent that it may lawfully so agree, the Company shall
not at any time set up, claim or otherwise seek to take the benefit or advantage
of any stay or extension law, now or hereafter in effect, in order to prevent or
hinder the enforcement of this Indenture; and the Company, for itself and all
who may claim under it, so far as it or they now or hereafter may lawfully do
so, hereby waives the benefit of all such laws.

SECTION 716. ACTION BY HOLDERS OF CERTAIN TRUST SECURITIES.

            If the Securities of any series shall be held by the Institutional
Trustee of a Trust and if such Institutional Trustee, as such Holder, shall have
failed to exercise any of the rights and remedies available under this Indenture
to the Holders of such Securities, the holders of the Trust Securities issued by
such Trust (other than Trust Securities initially issued and sold to the
Company) shall have and may exercise all such rights and remedies, to the same
extent as if such holders of such Trust Securities held a principal amount of
Securities of such series equal to the

                                       56
<PAGE>

liquidation preference of such Trust Securities, without first proceeding
against such trustee or trust. Notwithstanding the foregoing, in the case of an
Event of Default described in clause (a) or (b) of Section 701, each holder of
such Trust Securities shall have and may exercise all rights available to the
Institutional Trustee under Section 708 as the Holder of the Securities of such
series.

            If action shall have been taken by both the Holders and the holders
of Trust Securities (other than Trust Securities initially issued and sold to
the Company) to exercise such rights as contemplated in the preceding paragraph,
the action taken by holders of Trust Securities shall control. Any such action
taken by registered holders of Trust Securities shall be evidenced to the
Trustee in the same manner as an Act of Holders, as provided in Section 104(a).
The Trustee shall be entitled to rely on the books and records of the related
Trust in determining the identities of the holders of Trust Securities (and,
upon the reasonable request of the Trustee, the Company, as the sponsor of such
Trust, shall, at its own expense, promptly provide copies of applicable portions
of such books and records to the Trustee to the extent reasonably necessary to
enable the Trustee to make such determination).

                                  ARTICLE EIGHT

                                  THE TRUSTEE

SECTION 801. CERTAIN DUTIES AND RESPONSIBILITIES.

            (a)   Except during the continuance of an Event of Default with
respect to Securities of any series,

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

                  (ii)  in the absence of bad faith on its part, the Trustee
            may, with respect to Securities of such series, 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;
            but in the case of any such certificates or opinions which by any
            provisions hereof are specifically required to be furnished to the
            Trustee, the Trustee shall be under a duty to examine the same to
            determine whether or not they conform to the requirements of this
            Indenture.

            (b)   In case an Event of Default with respect to Securities of any
series shall have occurred and be continuing, the Trustee shall exercise, with
respect to Securities of such series, such of the rights and powers vested in it
by this Indenture, and use the same degree of care and skill in

                                       57
<PAGE>

their exercise, as a prudent man would exercise or use under the circumstances
in the conduct of his own affairs.

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

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

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

                  (iii) the Trustee shall not be liable with respect to any
            action taken or omitted to be taken by it in good faith in
            accordance with the direction of the Holders of a majority in
            principal amount of the Outstanding Securities of any one or more
            series, as provided herein, relating to the time, method and place
            of conducting any proceeding for any remedy available to the
            Trustee, or exercising any trust or power conferred upon the
            Trustee, under this Indenture with respect to the Securities of such
            series; and

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

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

SECTION 802. NOTICE OF DEFAULTS.

            The Trustee shall give notice of any default hereunder known to the
Trustee with respect to the Securities of any series to the Holders of
Securities of such series in the manner and to the extent required to do so by
the Trust Indenture Act, unless such default shall have been cured or waived;
provided, however, that in the case of any default of the character specified in
Section 701(c), no such notice to Holders shall be given until at least
seventy-five (75) days after the occurrence thereof; and provided, further,
that, subject to the provisions of Section 801, the Trustee shall not be deemed
to have knowledge of such default unless either (i) a Responsible Officer of the
Trustee shall have actual knowledge of such default or (ii) the Trustee shall
have received written notice thereof from the Company or any Holder or, in the
case of a default described in Section

                                       58
<PAGE>

701(d), from the holder of any indebtedness or from the trustee under any
mortgage, indenture or other instrument referred to in such Section. For the
purpose of this Section, the term "DEFAULT" means any event which is, or after
notice or lapse of time, or both, would become, an Event of Default with respect
to the Securities of such series.

SECTION 803. CERTAIN RIGHTS OF TRUSTEE.

            Subject to the provisions of Section 801 and to the applicable
provisions of the Trust Indenture Act:

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

            (b)   any request, direction or act of the Company mentioned herein
      shall be sufficiently evidenced by a Company Request or Company Order, or
      as otherwise expressly provided herein, and any resolution of the Board of
      Directors of the Company may be sufficiently evidenced by a Board
      Resolution;

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

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

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

            (f)   the Trustee shall not be bound to make any investigation into
      the facts or matters stated in any resolution, certificate, statement,
      instrument, opinion, report, notice, request, direction, consent, order,
      bond, debenture, note, other evidence of indebtedness or other paper or
      document, but the Trustee, in its discretion, may make such further
      inquiry or investigation into such facts or matters as it may see fit,
      and, if the Trustee shall determine to make such further inquiry or
      investigation, it shall (subject to applicable legal requirements)

                                       59
<PAGE>

      be entitled to examine, during normal business hours, the books, records
      and premises of the Company, personally or by agent or attorney;

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

            (h)   the Trustee shall not be charged with knowledge of any Event
      of Default with respect to the Securities of any series for which it is
      acting as Trustee unless either (i) a Responsible Officer of the Trustee
      shall have actual knowledge of the Event of Default or (ii) written notice
      of such Event of Default shall have been given to the Trustee by the
      Company, any other obligor on such Securities or by any Holder of such
      Securities.

SECTION 804. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.

            The recitals contained herein and in the Securities (except the
Trustee's certificates of authentication) shall be taken as the statements of
the Company, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Securities. Neither the
Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of Securities or the proceeds thereof.

SECTION 805. MAY HOLD SECURITIES.

            Each of the Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other agent of the Company or the Trustee, in its
individual or any other capacity, may become the owner or pledgee of Securities
and/or Preferred Securities, subject to Sections 808 and 813, may otherwise deal
with the Company with the same rights it would have if it were not such Trustee,
Authenticating Agent, Paying Agent, Security Registrar or other agent.

SECTION 806. MONEY HELD IN TRUST.

            Money held by the Trustee in trust hereunder need not be segregated
from other funds, except to the extent required by law. The Trustee shall be
under no liability for interest on or investment of any money received by it
hereunder except as expressly provided herein or otherwise agreed with, and for
the sole benefit of, the Company.

SECTION 807. COMPENSATION AND REIMBURSEMENT.

            The Company agrees

                                       60
<PAGE>

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

            (b)   except as otherwise expressly provided herein, to reimburse
      the Trustee upon its request for all reasonable expenses, disbursements
      and advances reasonably incurred or made by the Trustee in accordance with
      any provision of this Indenture (including the reasonable compensation and
      the expenses and disbursements of its agents and counsel), except to the
      extent that any such expense, disbursement or advance as may be
      attributable to its negligence, willful misconduct or bad faith; and

            (c)   to indemnify the Trustee and hold it harmless from and against
      any loss, liability or expense reasonably incurred by it arising out of or
      in connection with the acceptance or administration of the trust or trusts
      hereunder or the performance of its duties hereunder, including the
      reasonable costs and expenses of defending itself against any claim or
      liability in connection with the exercise or performance of any of its
      powers or duties hereunder, except to the extent that any such loss,
      liability or expense may be attributable to its negligence, willful
      misconduct or bad faith.

            As security for the performance of the obligations of the Company
under this Section, the Trustee shall have a lien prior to the Securities upon
all property and funds held or collected by the Trustee as such other than
property and funds held in trust under Section 603 (except moneys payable to the
Company as provided in Section 603). "TRUSTEE" for purposes of this Section
shall include any predecessor Trustee; provided, however, that the negligence,
willful misconduct or bad faith of any Trustee hereunder shall not affect the
rights of any other Trustee hereunder.

SECTION 808. DISQUALIFICATION; CONFLICTING INTERESTS.

            If the Trustee shall have or acquire any conflicting interest within
the meaning of the Trust Indenture Act, it shall either eliminate such
conflicting interest or resign to the extent, in the manner and with the effect,
and subject to the conditions, provided in the Trust Indenture Act and this
Indenture. For purposes of Section 310(b)(1) of the Trust Indenture Act and to
the extent permitted thereby, the Trustee, in its capacity as trustee in respect
of the Securities of any series, shall not be deemed to have a conflicting
interest arising from its capacity as trustee in respect of (i) the Securities
of any other series and (ii) the Declaration and the Trust Securities Guarantee
Agreement pertaining to each Trust.

SECTION 809. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.

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

                                       61
<PAGE>

            (a)   a corporation organized and doing business under the laws of
      the United States, any State or Territory thereof or the District of
      Columbia, authorized under such laws to exercise corporate trust powers,
      having a combined capital and surplus of at least Fifty Million Dollars
      ($50,000,000) and subject to supervision or examination by Federal, State,
      Territorial or District of Columbia authority, or

            (b)   if and to the extent permitted by the Commission by rule,
      regulation or order upon application, a corporation or other Person
      organized and doing business under the laws of a foreign government,
      authorized under such laws to exercise corporate trust powers, having a
      combined capital and surplus of at least Fifty Million Dollars
      ($50,000,000) or the Dollar equivalent of the applicable foreign currency
      and subject to supervision or examination by authority of such foreign
      government or a political subdivision thereof substantially equivalent to
      supervision or examination applicable to United States institutional
      trustees,

and, in either case, qualified and eligible under this Article and the Trust
Indenture Act. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of such supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section or the Trust Indenture Act, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.

SECTION 810. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.

            (a)   No resignation or removal of the Trustee and no appointment of
a successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 811.

            (b)   The Trustee may resign at any time with respect to the
Securities of one or more series by giving written notice thereof to the
Company. If the instrument of acceptance by a successor Trustee required by
Section 811 shall not have been delivered to the Trustee within thirty (30) days
after the giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee with respect to the Securities of such series.

            (c)   The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal amount
of the Outstanding Securities of such series delivered to the Trustee and to the
Company; provided that so long as any Preferred Securities remain outstanding,
the Trust which issued such Preferred Securities shall not execute any Act to
remove the Trustee without the consent of the holders of a majority in aggregate
liquidation preference of Preferred Securities issued by such Trust outstanding,
obtained as provided in the Declaration pertaining to such Trust.

                                       62
<PAGE>

                  (d)   If at any time:

                        (i)   the Trustee shall fail to comply with Section 808
                  after written request therefor by the Company or by any Holder
                  who has been a bona fide Holder for at least six months, or

                        (ii)  the Trustee shall cease to be eligible under
                  Section 809 or Section 310(a) of the Trust Indenture Act and
                  shall fail to resign after written request therefor by the
                  Company or by any such Holder, or

                        (iii) the Trustee shall become incapable of acting or
                  shall be adjudged a bankrupt or insolvent or a receiver of the
                  Trustee or of its property shall be appointed or any public
                  officer shall take charge or control of the Trustee or of its
                  property or affairs for the purpose of rehabilitation,
                  conservation or liquidation,

then, in any such case, (x) the Company may remove the Trustee with respect to
all Securities or (y) subject to Section 714, any Holder who has been a bona
fide Holder for at least six (6) months may, on behalf of itself and all others
similarly situated, petition any court of competent jurisdiction for the removal
of the Trustee with respect to all Securities and the appointment of a successor
Trustee or Trustees.

                  (e)   If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause (other than as contemplated in clause (y) in subsection (d) of this
Section), with respect to the Securities of one or more series, the Company
shall take prompt steps to appoint a successor Trustee or Trustees with respect
to the Securities of that or those series (it being understood that any such
successor Trustee may be appointed with respect to the Securities of one or more
or all of such series and that at any time there shall be only one Trustee with
respect to the Securities of any particular series) and shall comply with the
applicable requirements of Section 811. If, within one (1) year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Securities of any series shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable requirements of Section
811, become the successor Trustee with respect to the Securities of such series
and to that extent supersede the successor Trustee appointed by the Company. If
no successor Trustee with respect to the Securities of any series shall have
been so appointed by the Company or the Holders and accepted appointment in the
manner required by Section 811, any Holder who has been a bona fide Holder of a
Security of such series for at least six (6) months may, on behalf of itself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.

                  (f)   So long as no event which is, or after notice or lapse
of time, or both, would become, an Event of Default shall have occurred and be
continuing, if the Company shall have

                                       63
<PAGE>

delivered to the Trustee or Trustees with respect to the Securities of one or
more series (i) an instrument executed by an Authorized Officer of the Company
appointing a successor Trustee or Trustees with respect to such series,
effective as of a date specified therein, and (ii) an instrument of acceptance
of such appointment, effective as of such date, by such successor Trustee or
Trustees in accordance with Section 811, the Trustee or Trustees with respect to
such series shall be deemed to have resigned as contemplated in subsection (b)
of this Section, the successor Trustee or Trustees shall be deemed to have been
appointed by the Company pursuant to subsection (e) of this Section and such
appointment shall be deemed to have been accepted as contemplated in Section
811, all as of such date, and all other provisions of this Section and Section
811 shall be applicable to such resignation, appointment and acceptance except
to the extent inconsistent with this subsection (f).

            (g)   The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series
to all Holders of Securities of such series. Each notice shall include the name
of the successor Trustee with respect to the Securities of such series and the
address of its corporate trust office.

SECTION 811. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.

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

            (b)   In case of the appointment hereunder of a successor Trustee
with respect to the Securities of one or more (but not all) series, the Company,
the retiring Trustee and each successor Trustee with respect to the Securities
of such series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Trustee all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates, (2)
if the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing

                                       64
<PAGE>

herein or in such supplemental indenture shall constitute such Trustees
co-trustees of the same trust and that each such Trustee shall be trustee of a
trust or trusts hereunder separate and apart from any trust or trusts hereunder
administered by any other such Trustee; and upon the execution and delivery of
such supplemental indenture the resignation or removal of the retiring Trustee
shall become effective to the extent provided therein and each such successor
Trustee, without any further act, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee with respect to the Securities
of that or those series to which the appointment of such successor Trustee
relates; but, on request of the Company or any successor Trustee, such retiring
Trustee, upon payment of all sums owed to it, shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder with respect to the Securities of that or those series to
which the appointment of such successor Trustee relates.

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

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

SECTION 812. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.

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

SECTION 813. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.

            If the Trustee shall be or become a creditor of the Company or any
other obligor upon the Securities (other than by reason of a relationship
described in Section 311(b) of the Trust Indenture Act), the Trustee shall be
subject to any and all applicable provisions of the Trust Indenture Act
regarding the collection of claims against the Company or such other obligor.
For purposes of Section 311(b) of the Trust Indenture Act:

            (a)   the term "CASH TRANSACTION" means any transaction in which
      full payment for goods or securities sold is made within seven days after
      delivery of the goods or securities in currency or in

                                       65
<PAGE>

      checks or other orders drawn upon banks or bankers and payable upon
      demand; and

            (b)   the term "SELF-LIQUIDATING PAPER" means any draft, bill of
      exchange, acceptance or obligation which is made, drawn, negotiated or
      incurred by the Company or such obligor for the purpose of financing the
      purchase, processing, manufacturing, shipment, storage or sale of goods,
      wares or merchandise and which is secured by documents evidencing title
      to, possession of, or a lien upon, the goods, wares or merchandise or the
      receivables or proceeds arising from the sale of the goods, wares or
      merchandise previously constituting the security, provided the security is
      received by the Trustee simultaneously with the creation of the creditor
      relationship with the Company or such obligor arising from the making,
      drawing, negotiating or incurring of the draft, bill of exchange,
      acceptance or obligation.

SECTION 814. APPOINTMENT OF AUTHENTICATING AGENT.

            The Trustee may appoint an Authenticating Agent or Agents with
respect to the Securities of one or more series, or any Tranche thereof, which
shall be authorized to act on behalf of the Trustee to authenticate Securities
of such series or Tranche issued upon original issuance, exchange, registration
of transfer or partial redemption thereof or pursuant to Section 306, and
Securities so authenticated shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Securities by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Company and shall at all times be a corporation organized and doing business
under the laws of the United States, any State or Territory thereof or the
District of Columbia or the Commonwealth of Puerto Rico, authorized under such
laws to act as Authenticating Agent, having a combined capital and surplus of
not less than Fifty Million Dollars ($50,000,000) and subject to supervision or
examination by Federal or State authority. If such Authenticating Agent
publishes reports of condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then for the purposes
of this Section, the combined capital and surplus of such Authenticating Agent
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time an Authenticating Agent
shall cease to be eligible in accordance with the provisions of this Section,
such Authenticating Agent shall resign immediately in the manner and with the
effect specified in this Section.

            Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to all or substantially all of
the corporate agency or corporate trust business of an Authenticating Agent,
shall continue to be an Authenticating Agent, provided such corporation shall be
otherwise

                                       66
<PAGE>

eligible under this Section, without the execution or filing of any paper or any
further act on the part of the Trustee or the Authenticating Agent.

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

            The Company agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section.

            The provisions of Sections 308, 804 and 805 shall be applicable to
each Authenticating Agent.

            If an appointment with respect to the Securities of one or more
series, or any Tranche thereof, shall be made pursuant to this Section, the
Securities of such series or Tranche may have endorsed thereon, in addition to
the Trustee's certificate of authentication, an alternate certificate of
authentication substantially in the following form:

            This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.

                                                ________________________________
                                                As Trustee

                                                By _____________________________
                                                As Authenticating Agent

                                                By _____________________________
                                                Authorized Officer

            If all of the Securities of a series may not be originally issued at
one time, and if the Trustee does not have an office capable of authenticating
Securities upon original issuance located in a Place of Payment where the
Company wishes to have Securities of such series authenticated upon original
issuance, the Trustee, if so requested by the Company in writing (which writing
need

                                       67
<PAGE>

not comply with Section 102 and need not be accompanied by an Opinion of
Counsel), shall appoint, in accordance with this Section and in accordance with
such procedures as shall be acceptable to the Trustee, an Authenticating Agent
having an office in a Place of Payment designated by the Company with respect to
such series of Securities.

                                  ARTICLE NINE

                LISTS OF HOLDERS; REPORTS BY TRUSTEE AND COMPANY

SECTION 901. LISTS OF HOLDERS.

            Semiannually, not later than June 1 and December 1 in each year,
commencing June 1, 2004, and within thirty (30) days of such other times as the
Trustee may request in writing, the Company shall furnish or cause to be
furnished to the Trustee information as to the names and addresses of the
Holders, as of a date no more than fifteen (15) days prior to the date such
information is so furnished, and the Trustee shall preserve such information and
similar information received by it in any other capacity and afford to the
Holders access to information so preserved by it, all to such extent, if any,
and in such manner as shall be required by the Trust Indenture Act; provided,
however, that no such list need be furnished so long as the Trustee shall be the
Security Registrar.

SECTION 902. REPORTS BY TRUSTEE AND COMPANY.

            Not later than May 15 in each year, commencing May 15, 2004, the
Trustee shall transmit to the Holders, the Commission and each securities
exchange upon which any Securities are listed, a report, dated as of the next
preceding May 15, with respect to any events and other matters described in
Section 313(a) of the Trust Indenture Act, in such manner and to the extent
required by the Trust Indenture Act. The Trustee shall transmit to the Holders,
the Commission and each securities exchange upon which any Securities are
listed, and the Company shall file with the Trustee (within thirty (30) days
after filing with the Commission in the case of reports which pursuant to the
Trust Indenture Act must be filed with the Commission and furnished to the
Trustee) and transmit to the Holders, such other information, reports and other
documents, if any, at such times and in such manner, as shall be required by the
Trust Indenture Act. The Company shall notify the Trustee of the listing of any
Securities on any securities exchange.

                                       68
<PAGE>

                                   ARTICLE TEN

                        CONSOLIDATION, MERGER, CONVEYANCE
                                OR OTHER TRANSFER

SECTION 1001. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.

            The Company shall not consolidate with or merge into any other
Person, or convey or otherwise transfer, or lease, all of its properties, as or
substantially as an entirety, to any Person, unless:

            (a)   the Person formed by such consolidation or into which the
      Company is merged or the Person which acquires by conveyance or other
      transfer, or which leases (for a term extending beyond the last Stated
      Maturity of the Securities then Outstanding), all of the properties of the
      Company, as or substantially as an entirety, shall be a Person organized
      and existing under the laws of the United States, any State or Territory
      thereof or the District of Columbia or under the laws of Canada or any
      Province thereof (such Person being hereinafter sometimes called the
      "SUCCESSOR") and shall expressly assume, by an indenture supplemental
      hereto, executed and delivered to the Trustee, in form reasonably
      satisfactory to the Trustee, the due and punctual payment of the principal
      of and premium, if any, and interest, if any, on all the Securities then
      Outstanding and the performance and observance of every other covenant and
      condition of this Indenture to be performed or observed by the Company;
      and

            (b)   the Company shall have delivered to the Trustee an Officer's
      Certificate and an Opinion of Counsel, each of which shall state that such
      consolidation, merger, conveyance or other transfer or lease, and such
      supplemental indenture, comply with this Article and that all conditions
      precedent herein provided for relating to such transaction have been
      complied with.

            Anything in this Indenture to the contrary notwithstanding, the
conveyance or other transfer by the Company of all of its facilities(a) for the
generation of electric energy, (b) for the transmission of electric energy or
(c) for the distribution of electric energy and/or natural gas, in each case
considered alone, or all of its facilities described in clauses (a) and (b),
considered together, or all of its facilities described in clauses (b) and (c),
considered together, shall in no event be deemed to constitute a conveyance or
other transfer of all the properties of the Company, as or substantially as an
entirety, unless, immediately following such conveyance or other transfer, the
Company shall own no properties in the other such categories of property not so
conveyed or otherwise transferred. The character of particular facilities shall
be determined by reference to the Uniform System of Accounts prescribed for
public utilities and licensees subject to the Federal Power Act, as amended, to
the extent applicable.

SECTION 1002. SUCCESSOR SUBSTITUTED.

                                       69
<PAGE>

            Upon any consolidation or merger or any conveyance or other transfer
of all the properties of the Company, as or substantially as an entirety, in
accordance with Section 1001, the Successor shall succeed to, and be substituted
for, and may exercise every power and right of, the Company under this Indenture
with the same effect as if such Successor had been named as the "Company"
herein. Without limiting the generality of the foregoing, the Successor may
execute and deliver to the Trustee, and thereupon the Trustee shall, subject to
the provisions of Article Three, authenticate and deliver, Securities. All
Securities so executed by the Successor, and authenticated and delivered by the
Trustee, shall in all respects be entitled to the benefits provided by this
Indenture equally and ratably with all Securities executed, authenticated and
delivered prior to the time such consolidation, merger, conveyance or other
transfer became effective.

SECTION 1003. RELEASE OF COMPANY UPON CONVEYANCE OR OTHER TRANSFER.

            In the case of a conveyance or other transfer to any Person or
Persons as contemplated in Section 1001, upon the satisfaction of all the
conditions specified in Section 1001 the Company (such term being used in this
Section without giving effect to such transaction) shall be released and
discharged from all obligations and covenants under this Indenture and on and
under all Securities then Outstanding (unless the Company shall have delivered
to the Trustee an instrument in which it shall waive such release and discharge)
and the Trustee shall acknowledge in writing that the Company has been so
released and discharged.

SECTION 1004. MERGER INTO COMPANY.

            Nothing in this Indenture shall be deemed to prevent or restrict any
consolidation or merger after the consummation of which the Company would be the
surviving or resulting corporation or any conveyance or other transfer, or lease
of any part of the properties of the Company which does not constitute the
entirety, or substantially the entirety, thereof.

SECTION 1005. TRANSFER OF LESS THAN THE ENTIRETY.

      (a)   If the Company shall have conveyed or otherwise transferred any part
of its properties which does not constitute the entirety, or substantially the
entirety, thereof to another corporation meeting the requirements set forth in
clause (a) of the first paragraph of Section 1001 and if:

            (i)   the transferee of such part of the properties of the Company
      shall have executed and delivered to the Trustee an indenture supplemental
      hereto, in form reasonably satisfactory to the Trustee, which contains an
      assumption by such transferee of the due and punctual payment of the
      principal of and premium, if any, and interest, if any, on all the
      Securities then Outstanding and the performance and observance of every
      covenant and condition of this Indenture to be performed or observed by
      the Company;

                                       70
<PAGE>

            (ii)  there shall have been delivered to the Trustee an Independent
      Expert's Certificate

                  (A)   describing the property so conveyed or otherwise
            transferred (such description of property to be made by reference
            either to specific items, units and/or elements of property or
            portions thereof, on a percentage or Dollar basis, or to properties
            reflected in specified accounts in the Company's books of account or
            portions thereof, on a Dollar basis); provided, however, that such
            property shall be identified in such certificate as facilities for
            the generation, transmission or distribution of electric energy or
            for the storage, transportation or distribution of natural gas;

                  (B)   stating, in the judgment of the signers, the Fair Value
            to the transferee of the property so conveyed or otherwise
            transferred;

                  (C)   stating an amount equal to seventy percent (70%) of the
            amount stated pursuant to clause (B) above; provided, however, that
            there shall be excluded from the property so evaluated any property
            subject to any mortgage, deed of trust, security interest or other
            lien which secures indebtedness for borrowed money or for the
            deferred purchase price of property;

                  (D)   stating an amount equal to the aggregate principal
            amount of the Securities then Outstanding; and

                  (E)   stating that the amount stated pursuant to clause (D)
            above does not exceed the amount stated pursuant to clause (C)
            above;

            (iii) the Company shall have assigned or otherwise transferred to
      such transferee all Trust Securities (initially issued and sold to the
      Company) then outstanding, and such transferee shall have expressly
      assumed all obligations under all Trust Securities Guarantees; and

            (iv)  the Company shall have delivered to the Trustee an Officer's
      Certificate and an Opinion of Counsel each of which shall state that such
      conveyance or other transfer and such supplemental indenture comply with
      this Section and that all conditions precedent relating to such
      transactions provided for in this Section and otherwise in this Indenture
      have been complied with;

then, upon the satisfaction of all such conditions,

            (x)   the Company shall be released and discharged from all
      obligations and covenants under this Indenture and on and under all
      Securities then Outstanding (unless the Company shall have delivered to
      the Trustee an instrument in which it shall waive such

                                       71
<PAGE>

      release and discharge), and the Trustee shall acknowledge in writing that
      the Company has been so released and discharged; and

            (y)   if the Company shall have been released and discharged as
      contemplated in clause (x) above, such transferee shall succeed to, and be
      substituted for, and may exercise every right and power of, the Company
      under this Indenture with the same effect as if such transferee had been
      named the "Company" herein; and without limiting the generality of the
      foregoing, such transferee shall be deemed a "Successor" for purposes of
      Section 1002 and for all other purposes of this Indenture.

      (b)   For purposes of this Section:

                  "FAIR VALUE" means the fair value of such property so conveyed
            or otherwise transferred as may be determined by reference to (a)
            the amount which would be likely to be obtained in an arm's-length
            transaction with respect to such property between an informed and
            willing buyer and an informed and willing seller, under no
            compulsion, respectively, to buy or sell, (b) the amount of
            investment with respect to such property which, together with a
            reasonable return thereon, would be likely to be recovered through
            ordinary business operations or otherwise, (c) the cost, accumulated
            depreciation and replacement cost with respect to such property
            and/or (d) any other relevant factors; provided, however, that (x)
            the Fair Value of property shall be determined without deduction for
            any mortgage, deed of trust, pledge, security interest, encumbrance,
            lease, reservation, restriction, servitude, charge or similar right
            or any other lien of any kind on such property and (y) the Fair
            Value to the transferee of any property shall not reflect any
            reduction relating to the fact that such property may be of less
            value to a Person which is not the owner or operator of the property
            or any portion thereof than to a Person which is such owner or
            operator. Fair Value may be determined, without physical inspection,
            by the use of accounting and engineering records and other data
            maintained by the Company or the transferee or otherwise available
            to the Expert certifying the same.

                  "INDEPENDENT EXPERT'S CERTIFICATE" means a certificate signed
            by an authorized officer of the transferee and by an Independent
            Expert (which Independent Expert shall be selected either by the
            board of directors or by an authorized officer of the transferee,
            the execution of such certificate by such authorized officer to be
            conclusive evidence of such selection) and delivered to the Trustee.
            For purposes of this definition, (a) "EXPERT" means a Person which
            is an engineer, appraiser or other expert and which, with respect to
            any certificate to be signed by such Person and delivered to the
            Trustee, is qualified to pass upon the matter set forth in such
            certificate; (b) "ENGINEER" means a Person engaged in the
            engineering profession or otherwise qualified to pass upon
            engineering matters (including, but not limited to, a Person
            licensed as a professional engineer, whether

                                       72
<PAGE>

            or not then engaged in the engineering profession) and (c)
            "APPRAISER" means a Person engaged in the business of appraising
            property or otherwise qualified to pass upon the Fair Value or fair
            market value of property. "INDEPENDENT", when applied to any Expert,
            means such a Person who (a) is in fact independent, (b) does not
            have any direct material financial interest in the transferee or in
            any obligor upon the Securities or in any Affiliate of the
            transferee, (c) is not connected with the transferee or such other
            obligor as an officer, employee, promoter, underwriter, trustee,
            partner, director or any person performing similar functions and (d)
            is approved by the Trustee in the exercise of reasonable care.

                                 ARTICLE ELEVEN

                             SUPPLEMENTAL INDENTURES

SECTION 1101. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.

            Without the consent of any Holders, the Company and the Trustee, at
any time and from time to time, may enter into one or more indentures
supplemental hereto, in form reasonably satisfactory to the Trustee, for any of
the following purposes:

                  (a)   to evidence the succession of another Person to the
            Company and the assumption by any such successor of the covenants of
            the Company herein and in the Securities, all as provided in Article
            Ten; or

                  (b)   to add one or more covenants of the Company or other
            provisions for the benefit of all Holders or for the benefit of the
            Holders of, or to remain in effect only so long as there shall be
            Outstanding, Securities of one or more specified series, or one or
            more specified Tranches thereof, or to surrender any right or power
            herein conferred upon the Company; or

                  (c)   to change or eliminate any provision of this Indenture
            or to add any new provision to this Indenture; provided, however,
            that if such change, elimination or addition shall adversely affect
            the interests of the Holders of Outstanding Securities of any series
            or Tranche in any material respect, such change, elimination or
            addition shall become effective with respect to such series or
            Tranche only in accordance with the provisions of Section 1102 or
            when no Security of such series or Tranche remains Outstanding; or

                  (d)   to provide collateral security for the Securities or any
            series thereof; or

                  (e)   to establish the form or terms of Securities of any
            series or Tranche as contemplated by Sections 201 and 301; or

                                       73
<PAGE>

                  (f)   to provide for the authentication and delivery of bearer
            securities and coupons appertaining thereto representing interest,
            if any, thereon and for the procedures for the registration,
            exchange and replacement thereof and for the giving of notice to,
            and the solicitation of the vote or consent of, the holders thereof,
            and for any and all other matters incidental thereto; or

                  (g)   to evidence and provide for the acceptance of
            appointment hereunder by a successor Trustee with respect to the
            Securities of one or more series and to add to or change any of the
            provisions of this Indenture as shall be necessary to provide for or
            facilitate the administration of the trusts hereunder by more than
            one Trustee, pursuant to the requirements of Section 811(b); or

                  (h)   to provide for the procedures required to permit the
            Company to utilize, at its option, a non-certificated system of
            registration for all, or any series or Tranche of, the Securities;
            or

                  (i)   to change any place or places where (1) the principal of
            and premium, if any, and interest, if any, on all or any series of
            Securities, or any Tranche thereof, shall be payable, (2) all or any
            series of Securities, or any Tranche thereof, may be surrendered for
            registration of transfer, (3) all or any series of Securities, or
            any Tranche thereof, may be surrendered for exchange and (4) notices
            and demands to or upon the Company in respect of all or any series
            of Securities, or any Tranche thereof, and this Indenture may be
            served; or

                  (j)   to cure any ambiguity, to correct or supplement any
            provision herein which may be defective or inconsistent with any
            other provision herein; or to make any other changes to the
            provisions hereof or to add other provisions with respect to matters
            or questions arising under this Indenture, provided that such other
            changes or additions shall not adversely affect the interests of the
            Holders of Securities of any series or Tranche in any material
            respect.

            Without limiting the generality of the foregoing, if the Trust
Indenture Act as in effect at the date of the execution and delivery of this
Indenture or at any time thereafter shall be amended and

                  (x)   if any such amendment shall require one or more changes
            to any provisions hereof or the inclusion herein of any additional
            provisions, or shall by operation of law be deemed to effect such
            changes or incorporate such provisions by reference or otherwise,
            this Indenture shall be deemed to have been amended so as to conform
            to such amendment to the Trust Indenture Act, and the Company and
            the Trustee may, without the consent of any Holders, enter into an
            indenture supplemental hereto to evidence such amendment hereof; or

                                       74
<PAGE>

                  (y)   if any such amendment shall permit one or more changes
            to, or the elimination of, any provisions hereof which, at the date
            of the execution and delivery hereof or at any time thereafter, are
            required by the Trust Indenture Act to be contained herein or are
            contained herein to reflect any provisions of the Trust Indenture
            Act as in effect at such date, this Indenture shall be deemed to
            have been amended to effect such changes or elimination, and the
            Company and the Trustee may, without the consent of any Holders,
            enter into an indenture supplemental hereto to evidence such
            amendment.

SECTION 1102. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.

            Subject to the provisions of Section 1101, with the consent of the
Holders of a majority in aggregate principal amount of the Securities of all
series then Outstanding under this Indenture, considered as one class, by Act of
said Holders delivered to the Company and the Trustee, the Company and the
Trustee may enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to, or changing in any manner or eliminating
any of the provisions of, this Indenture; provided, however, that if there shall
be Securities of more than one series Outstanding hereunder and if a proposed
supplemental indenture shall directly affect the rights of the Holders of
Securities of one or more, but less than all, of such series, then the consent
only of the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all series so directly affected, considered as one
class, shall be required; and provided, further, that if the Securities of any
series shall have been issued in more than one Tranche and if the proposed
supplemental indenture shall directly affect the rights of the Holders of
Securities of one or more, but less than all, of such Tranches, then the consent
only of the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected, considered as one
class, shall be required; and provided, further, that no such supplemental
indenture shall:

                  (a)   change the Stated Maturity of the principal of, or any
            installment of principal of or interest on, any Security other than
            pursuant to the terms thereof, or reduce the principal amount
            thereof or the rate of interest thereon (or the amount of any
            installment of interest thereon) or change the method of calculating
            such rate or reduce any premium payable thereon, or reduce the
            amount of the principal of any Discount Security that would be due
            and payable upon a declaration of acceleration of the Maturity
            thereof pursuant to Section 702, or change the coin or currency (or
            other property), in which any Security or premium, if any, or
            interest, if any, thereon is payable, or impair the right to
            institute suit for the enforcement of any such payment on or after
            the Maturity of any Security, without, in any such case, the consent
            of the Holder of such Security; or

                  (b)   reduce the percentage in principal amount of the
            Outstanding Securities of any series (or, if applicable, in
            liquidation preference of any series of Trust Securities), or any
            Tranche thereof, the consent of the Holders of which is required for
            any such supplemental indenture, or the consent of the Holders of
            which

                                       75
<PAGE>

            is required for any waiver of compliance with any provision of this
            Indenture or of any default hereunder and its consequences, or
            reduce the requirements of Section 1204 for quorum or voting,
            without, in any such case, the consent of the Holder of each
            Outstanding Security of such series or Tranche; or

                  (c)   modify any of the provisions of this Section, Section
            506 or Section 713 with respect to the Securities of any series or
            any Tranche thereof (except to increase the percentages in principal
            amount referred to in this Section or such other Sections or to
            provide that other provisions of this Indenture cannot be modified
            or waived) without, in any such case, the consent of the Holder of
            each Outstanding Security of such series or Tranche; provided,
            however, that this clause shall not be deemed to require the consent
            of any Holder with respect to changes in the references to "the
            Trustee" and concomitant changes in this Section, or the deletion of
            this proviso, in accordance with the requirements of Sections 811(b)
            and 1101(g).

            A supplemental indenture which (x) changes or eliminates any
covenant or other provision of this Indenture which has expressly been included
solely for the benefit of the Holders of, or which is to remain in effect only
so long as there shall be Outstanding, Securities of one or more specified
series, or one or more Tranches thereof, or (y) modifies the rights of the
Holders of Securities of such series or Tranches with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series or Tranche.

            Notwithstanding the foregoing, so long as any of the Preferred
Securities remain outstanding, the Trustee may not consent to a supplemental
indenture under this Section 1102 without the prior consent, obtained as
provided in a Declaration pertaining to a Trust which issued such Preferred
Securities of the holders of not less than a majority in aggregate liquidation
preference of all Trust Securities issued by such Trust affected, considered as
one class, or, in the case of changes described in clauses (a), (b) and (c)
above, 100% in aggregate liquidation preference of all such Preferred Securities
then outstanding which would be affected thereby, considered as one class.

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

            Anything in this Indenture to the contrary notwithstanding, if the
Officer's Certificate, supplemental indenture or Board Resolution, as the case
may be, establishing the Securities of any series or Tranche shall so provide,
(a) the Holders of such Securities shall be deemed to have consented to a
supplemental indenture containing the additions, changes or eliminations to or
from the Indenture which shall be specified in such Officer's Certificate,
supplemental indenture or Board Resolution establishing such series or Tranche,
(b) no Act of such Holders shall be required to evidence such consent and (c)
such consent may be counted in the

                                       76
<PAGE>

determination of whether or not the Holders of the requisite principal amount of
Securities shall have consented to such supplemental indenture.

SECTION 1103. EXECUTION OF SUPPLEMENTAL INDENTURES.

            In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 801) 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, immunities or liabilities under this Indenture or
otherwise.

SECTION 1104. EFFECT OF SUPPLEMENTAL INDENTURES.

            Upon the execution and delivery of any supplemental indenture under
this Article this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes; and
every Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby. Any supplemental indenture permitted by this
Article may restate this Indenture in its entirety, and, upon the execution and
delivery thereof, any such restatement shall supersede this Indenture as
theretofore in effect for all purposes.

SECTION 1105. CONFORMITY WITH TRUST INDENTURE ACT.

            Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.

SECTION 1106. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.

            Securities of any series, or any Tranche thereof, authenticated and
delivered after the execution of any supplemental indenture pursuant to this
Article may, and shall if required by the Trustee, bear a notation in form
approved by the Trustee as to any matter provided for in such supplemental
indenture. If the Company shall so determine, new Securities of any series, or
any Tranche thereof, so modified as to conform, in the opinion of the Trustee
and the Company, to any such supplemental indenture may be prepared and executed
by the Company and authenticated and delivered by the Trustee in exchange for
Outstanding Securities of such series or Tranche.

SECTION 1107. MODIFICATION WITHOUT SUPPLEMENTAL INDENTURE.

            To the extent, if any, that the terms of any particular series of
Securities shall have been established in or pursuant to an Officer's
Certificate or a Board Resolution as contemplated by Section 301, and not in a
supplemental indenture hereto, additions to, changes in or the elimination of
any of such terms may be effected by means of a supplemental Officer's
Certificate or a

                                       77
<PAGE>

supplemental Board Resolution, as the case may be, delivered to, and accepted
by, the Trustee; provided, however, that such supplemental Officer's Certificate
or supplemental Board Resolution shall not be accepted by the Trustee or
otherwise be effective unless all conditions set forth in this Indenture which
would be required to be satisfied if such additions, changes or elimination were
contained in a supplemental indenture shall have been appropriately satisfied.
Upon the acceptance thereof by the Trustee, any supplemental Officer's
Certificate or supplemental Board Resolution shall be deemed to be a
"supplemental indenture" for purposes of Section 1104 and 1106.

                                 ARTICLE TWELVE

                   MEETINGS OF HOLDERS; ACTION WITHOUT MEETING

SECTION 1201. PURPOSES FOR WHICH MEETINGS MAY BE CALLED.

            A meeting of Holders of Securities of one or more, or all, series,
or any Tranche or Tranches thereof, may be called at any time and from time to
time pursuant to this Article to make, give or take any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be made, given or taken by Holders of Securities of such
series or Tranches.

SECTION 1202. CALL, NOTICE AND PLACE OF MEETINGS.

            (a)   The Trustee may at any time call a meeting of Holders of
Securities of one or more, or all, series, or any Tranche or Tranches thereof,
for any purpose specified in Section 1201, to be held at such time and (except
as provided in subsection (b) of this Section) at such place in the Borough of
Manhattan, The City of New York, as the Trustee shall determine, or, with the
approval of the Company, at any other place. Notice of every such meeting,
setting forth the time and the place of such meeting and in general terms the
action proposed to be taken at such meeting, shall be given, in the manner
provided in Section 106, not less than twenty-one (21) nor more than one hundred
eighty (180) days prior to the date fixed for the meeting.

            (b)   The Trustee may be asked to call a meeting of the Holders of
Securities of one or more, or all, series, or any Tranche or Tranches thereof,
by the Company or by the Holders of thirty-three per centum (33%) in aggregate
principal amount of all of such series and Tranches, considered as one class,
for any purpose specified in Section 1201, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting. If the Trustee
shall have been asked by the Company to call such a meeting, the Company shall
determine the time and place for such meeting and may call such meeting by
giving notice thereof in the manner provided in subsection (a) of this Section,
or shall direct the Trustee, in the name and at the expense of the Company, to
give such notice. If the Trustee shall have been asked to call such a meeting by
Holders in accordance with this subsection (b), and the Trustee shall not have
given the notice of such meeting within twenty-one (21) days after receipt of
such request or shall not thereafter proceed to cause the meeting to be held as
provided herein, then the Holders of Securities of such

                                       78
<PAGE>

series and Tranches, in the principal amount above specified, may determine the
time and the place in the Borough of Manhattan, The City of New York, or in such
other place as shall be determined or approved by the Company for such meeting
and may call such meeting for such purposes by giving notice thereof as provided
in subsection (a) of this Section.

            (c)   Any meeting of Holders of Securities of one or more, or all,
series, or any Tranche or Tranches thereof, shall be valid without notice if the
Holders of all Outstanding Securities of such series or Tranches are present in
person or by proxy and if representatives of the Company and the Trustee are
present, or if notice is waived in writing before or after the meeting by the
Holders of all Outstanding Securities of such series, or any Tranche or Tranches
thereof, or by such of them as are not present at the meeting in person or by
proxy, and by the Company and the Trustee.

SECTION 1203. PERSONS ENTITLED TO VOTE AT MEETINGS.

            To be entitled to vote at any meeting of Holders of Securities of
one or more, or all, series, or any Tranche or Tranches thereof, a Person shall
be (a) a Holder of one or more Outstanding Securities of such series or
Tranches, or (b) a Person appointed by an instrument in writing as proxy for a
Holder or Holders of one or more Outstanding Securities of such series or
Tranches by such Holder or Holders. The only Persons who shall be entitled to
attend any meeting of Holders of Securities of any series or Tranche shall be
the Persons entitled to vote at such meeting and their counsel, any
representatives of the Trustee and its counsel and any representatives of the
Company and its counsel.

SECTION 1204. QUORUM; ACTION.

            The Persons entitled to vote a majority in aggregate principal
amount of the Outstanding Securities of the series and Tranches with respect to
which a meeting shall have been called as hereinbefore provided, considered as
one class, shall constitute a quorum for a meeting of Holders of Securities of
such series and Tranches; provided, however, that if any action is to be taken
at such meeting which this Indenture expressly provides may be taken by the
Holders of a specified percentage, which is less than a majority, in principal
amount of the Outstanding Securities of such series and Tranches, considered as
one class, the Persons entitled to vote such specified percentage in principal
amount of the Outstanding Securities of such series and Tranches, considered as
one class, shall constitute a quorum. In the absence of a quorum within one hour
of the time appointed for any such meeting, the meeting shall, if convened at
the request of Holders of Securities of such series and Tranches, be dissolved.
In any other case the meeting may be adjourned for such period as may be
determined by the chairman of the meeting prior to the adjournment of such
meeting. In the absence of a quorum at any such adjourned meeting, such
adjourned meeting may be further adjourned for such period as may be determined
by the chairman of the meeting prior to the adjournment of such adjourned
meeting. Except as provided by Section 1205(e), notice of the reconvening of any
meeting adjourned for more than thirty (30) days shall be given as provided in
Section 106 not less than ten (10) days prior to the date on which the meeting

                                       79
<PAGE>

is scheduled to be reconvened. Notice of the reconvening of an adjourned meeting
shall state expressly the percentage, as provided above, of the principal amount
of the Outstanding Securities of such series and Tranches which shall constitute
a quorum.

            Except as limited by Section 1102, any resolution presented to a
meeting or adjourned meeting duly reconvened at which a quorum is present as
aforesaid may be adopted only by the affirmative vote of the Holders of a
majority in aggregate principal amount of the Outstanding Securities of the
series and Tranches with respect to which such meeting shall have been called,
considered as one class; provided, however, that, except as so limited, any
resolution with respect to any action which this Indenture expressly provides
may be taken by the Holders of a specified percentage, which is less than a
majority, in principal amount of the Outstanding Securities of such series and
Tranches, considered as one class, may be adopted at a meeting or an adjourned
meeting duly reconvened and at which a quorum is present as aforesaid by the
affirmative vote of the Holders of such specified percentage in principal amount
of the Outstanding Securities of such series and Tranches, considered as one
class.

            Any resolution passed or decision taken at any meeting of Holders of
Securities duly held in accordance with this Section shall be binding on all the
Holders of Securities of the series and Tranches with respect to which such
meeting shall have been held, whether or not present or represented at the
meeting.

SECTION 1205. ATTENDANCE AT MEETINGS; DETERMINATION OF VOTING RIGHTS; CONDUCT
              AND ADJOURNMENT OF MEETINGS.

            (a)   Attendance at meetings of Holders of Securities may be in
person or by proxy; and, to the extent permitted by law, any such proxy shall
remain in effect and be binding upon any future Holder of the Securities with
respect to which it was given unless and until specifically revoked by the
Holder or future Holder (except as provided in Section 104(g)) of such
Securities before being voted.

            (b)   Notwithstanding any other provisions of this Indenture, the
Trustee may make such reasonable regulations as it may deem advisable for any
meeting of Holders of Securities in regard to proof of the holding of such
Securities and of the appointment of proxies and in regard to the appointment
and duties of inspectors of votes, the submission and examination of proxies,
certificates and other evidence of the right to vote, and such other matters
concerning the conduct of the meeting as it shall deem appropriate. Except as
otherwise permitted or required by any such regulations and approved by the
Company, the holding of Securities shall be proved in the manner specified in
Section 104 and the appointment of any proxy shall be proved in the manner
specified in Section 104. Such regulations may provide that written instruments
appointing proxies, regular on their face, may be presumed valid and genuine
without the proof specified in Section 104 or other proof.

                                       80
<PAGE>

            (c)   The Trustee shall, by an instrument in writing, appoint a
temporary chairman of the meeting, unless the meeting shall have been called by
the Company or by Holders as provided in Section 1202(b), in which case the
Company or the Holders of Securities of the series and Tranches calling the
meeting, as the case may be, shall in like manner appoint a temporary chairman.
A permanent chairman and a permanent secretary of the meeting shall be elected
by vote of the Persons entitled to vote a majority in aggregate principal amount
of the Outstanding Securities of all series and Tranches represented at the
meeting, considered as one class.

            (d)   At any meeting each Holder or proxy shall be entitled to one
vote for each One Thousand Dollars ($1,000) principal amount of Outstanding
Securities held or represented by such Holder; provided, however, that no vote
shall be cast or counted at any meeting in respect of any Security challenged as
not Outstanding and ruled by the chairman of the meeting to be not Outstanding.
The chairman of the meeting shall have no right to vote, except as a Holder of a
Security or proxy.

            (e)   Any meeting duly called pursuant to Section 1202 at which a
quorum is present may be adjourned from time to time by Persons entitled to vote
a majority in aggregate principal amount of the Outstanding Securities of all
series and Tranches represented at the meeting, considered as one class; and the
meeting may be held as so adjourned without further notice.

SECTION 1206. COUNTING VOTES AND RECORDING ACTION OF MEETINGS.

            The vote upon any resolution submitted to any meeting of Holders
shall be by written ballots on which shall be subscribed the signatures of the
Holders or of their representatives by proxy and the principal amounts and
serial numbers of the Outstanding Securities, of the series and Tranches with
respect to which the meeting shall have been called, held or represented by
them. The permanent chairman of the meeting shall appoint two inspectors of
votes who shall count all votes cast at the meeting for or against any
resolution and who shall make and file with the secretary of the meeting their
verified written reports of all votes cast at the meeting. A record in duplicate
of the proceedings of each meeting of Holders shall be prepared by the secretary
of the meeting and there shall be attached to such record the original reports
of the inspectors of votes on any vote by ballot taken thereat and affidavits by
one or more persons having knowledge of the facts setting forth a copy of the
notice of the meeting and showing that such notice was given as provided in
Section 1202 and, if applicable, Section 1204. Each copy shall be signed and
verified by the affidavits of the permanent chairman and secretary of the
meeting and one such copy shall be delivered to the Company, and another to the
Trustee to be preserved by the Trustee, the latter to have attached thereto the
ballots voted at the meeting. Any record so signed and verified shall be
conclusive evidence of the matters therein stated.

SECTION 1207. ACTION WITHOUT MEETING.

                                       81
<PAGE>

            In lieu of a vote of Holders at a meeting as hereinbefore
contemplated in this Article, any request, demand, authorization, direction,
notice, consent, waiver or other action may be made, given or taken by Holders
by written instruments as provided in Section 104.

                                ARTICLE THIRTEEN

               IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
                                  AND DIRECTORS

SECTION 1301. LIABILITY SOLELY CORPORATE.

            No recourse shall be had for the payment of the principal of or
premium, if any, or interest, if any, on any Securities, or any part thereof, or
for any claim based thereon or otherwise in respect thereof, or of the
indebtedness represented thereby, or upon any obligation, covenant or agreement
under this Indenture, against any incorporator, stockholder, officer or
director, as such, past, present or future, of the Company or of any predecessor
or successor of either of them (either directly or through the Company or a
predecessor or successor of either of them), whether by virtue of any
constitutional provision, statute or rule of law or by the enforcement of any
assessment or penalty or otherwise; it being expressly agreed and understood
that this Indenture and all the Securities are solely corporate obligations and
that no personal liability whatsoever shall attach to, or be incurred by, any
incorporator, stockholder, officer or director, past, present or future, of the
Company or of any predecessor or successor, either directly or indirectly
through the Company or any predecessor or successor, because of the indebtedness
hereby authorized or under or by reason of any of the obligations, covenants or
agreements contained in this Indenture or in any of the Securities or to be
implied herefrom or therefrom; and such personal liability, if any, is hereby
expressly waived and released as a condition of, and as part of the
consideration for, the execution and delivery of this Indenture and the issuance
of the Securities.

                                ARTICLE FOURTEEN

                           SUBORDINATION OF SECURITIES

SECTION 1401. SECURITIES SUBORDINATE TO SENIOR INDEBTEDNESS.

            The Company, for itself, its successors and assigns, covenants and
agrees, and each Holder of the Securities of each series, by its acceptance
thereof, likewise covenants and agrees, that the payment of the principal of and
premium, if any, and interest, if any, on each and all of the Securities is
hereby expressly subordinated and subject to the extent and in the manner set
forth in this Article, in right of payment to the prior payment in full of all
Senior Indebtedness of the Company.

                                       82
<PAGE>

            Each Holder of the Securities of each series, by its acceptance
thereof, authorizes and directs the Trustee on its behalf to take such action as
may be necessary or appropriate to effectuate the subordination as provided in
this Article, and appoints the Trustee its attorney-in-fact for any and all such
purposes.

SECTION 1402. PAYMENT OVER OF PROCEEDS OF SECURITIES.

            In the event (a) of any insolvency or bankruptcy proceedings or any
receivership, liquidation, reorganization or other similar proceedings in
respect of the Company or a substantial part of its property, or of any
proceedings for liquidation, dissolution or other winding-up of the Company,
whether or not involving insolvency or bankruptcy, or (b) subject to the
provisions of Section 1403, that (i) a default shall have occurred with respect
to the payment of principal of or interest on or other monetary amounts due and
payable on any Senior Indebtedness of the Company, or (ii) there shall have
occurred a default (other than a default in the payment of principal or interest
or other monetary amounts due and payable) in respect of any Senior
Indebtedness, as defined therein or in the instrument under which the same is
outstanding, permitting the holder or holders thereof to accelerate the maturity
thereof (with notice or lapse of time, or both), and such default shall have
continued beyond the period of grace, if any, in respect thereof, and, in the
case of subclauses (i) and (ii) of this clause (b), such default shall not have
been cured or waived or shall not have ceased to exist, or (c) that the
principal of and accrued interest on the Securities of any Series shall have
been declared due and payable pursuant to Section 701 and such declaration shall
not have been rescinded and annulled as provided in Section 702, then:

                  (1) the holders of all Senior Indebtedness of the Company
            shall first be entitled to receive payment of the full amount due
            thereon, or provision shall be made for such payment in money or
            money's worth, before the Holders of any of the Securities are
            entitled to receive a payment on account of the principal of or
            interest on the indebtedness evidenced by the Securities, including,
            without limitation, any payments made pursuant to Article Four;

                  (2) any payment by, or distribution of assets of, the Company
            of any kind or character, whether in cash, property or securities,
            to which any Holder or the Trustee would be entitled except for the
            provisions of this Article, shall be paid or delivered by the Person
            making such payment or distribution, whether a trustee in
            bankruptcy, a receiver or liquidating trustee or otherwise, directly
            to the holders of such Senior Indebtedness of the Company or their
            representative or representatives or to the trustee or trustees
            under any indenture under which any instruments evidencing any of
            such Senior Indebtedness of the Company may have been issued,
            ratably according to the aggregate amounts remaining unpaid on
            account of such Senior Indebtedness of the Company held or
            represented by each, to the extent necessary to make payment in full
            of all Senior Indebtedness of the Company remaining unpaid after
            giving effect to any concurrent payment or

                                       83
<PAGE>

            distribution (or provision therefor) to the holders of such Senior
            Indebtedness of the Company, before any payment or distribution is
            made to the Holders of the indebtedness evidenced by the Securities
            or to the Trustee under this Indenture; and

                  (3) in the event that, notwithstanding the foregoing, any
            payment by, or distribution of assets of, the Company of any kind or
            character, whether in cash, property or securities, in respect of
            principal of or interest on the Securities or in connection with any
            repurchase by the Company of the Securities, shall be received by
            the Trustee or any Holder before all Senior Indebtedness of the
            Company is paid in full, or provision is made for such payment in
            money or money's worth, such payment or distribution in respect of
            principal of or interest on the Securities or in connection with any
            repurchase by the Company of the Securities shall be paid over to
            the holders of such Senior Indebtedness of the Company or their
            representative or representatives or to the trustee or trustees
            under any indenture under which any instruments evidencing any such
            Senior Indebtedness of the Company may have been issued, ratably as
            aforesaid, for application to the payment of all Senior Indebtedness
            of the Company remaining unpaid until all such Senior Indebtedness
            of the Company 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 of the Company.

            Notwithstanding the foregoing, at any time after the 123rd day
following the date of deposit of cash or Eligible Obligations pursuant to
Section 601 (provided all conditions set out in such Section shall have been
satisfied), the funds so deposited and any interest thereon will not be subject
to any rights of holders of Senior Indebtedness of the Company including,
without limitation, those arising under this Article Fourteen; provided that no
event described in clause (e) of Section 701 with respect to the Company has
occurred during such 123-day period.

            For purposes of this Article only, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan or reorganization or readjustment which are subordinate
in right of payment to all Senior Indebtedness of the Company which may at the
time be outstanding to the same extent as, or to a greater extent than, the
Securities are so subordinated as provided in this Article. The consolidation of
the Company with, or the merger of the Company into, another corporation or the
liquidation or dissolution of the Company following the conveyance or transfer
of its property as an entirety, or substantially as an entirety, to another
corporation upon the terms and conditions provided for in Article Ten hereof
shall not be deemed a dissolution, winding-up, liquidation or reorganization for
the purposes of this Section 1402 if such other corporation shall, as a part of
such consolidation, merger, conveyance or transfer, comply with the conditions
stated in Article Ten hereof. Nothing in Section 1401 or in this Section 1402
shall apply to claims of, or payments to, the Trustee under or pursuant to
Section 807.

                                       84
<PAGE>

SECTION 1403. DISPUTES WITH HOLDERS OF CERTAIN SENIOR INDEBTEDNESS.

            Any failure by the Company to make any payment on or perform any
other obligation in respect of Senior Indebtedness of the Company, other than
any indebtedness incurred by the Company or assumed or guaranteed, directly or
indirectly, by the Company for money borrowed (or any deferral, renewal,
extension or refunding thereof) or any other obligation as to which the
provisions of this Section shall have been waived by the Company in the
instrument or instruments by which the Company incurred, assumed, guaranteed or
otherwise created such indebtedness or obligation, shall not be deemed a default
under clause (b) of Section 1402 if (i) the Company shall be disputing its
obligation to make such payment or perform such obligation and (ii) either (A)
no final judgment relating to such dispute shall have been issued against the
Company which is in full force and effect and is not subject to further review,
including a judgment that has become final by reason of the expiration of the
time within which a party may seek further appeal or review, or (B) in the event
that a judgment that is subject to further review or appeal has been issued, the
Company shall in good faith be prosecuting an appeal or other proceeding for
review and a stay or execution shall have been obtained pending such appeal or
review.

SECTION 1404. SUBROGATION.

            Senior Indebtedness of the Company shall not be deemed to have been
paid in full unless the holders thereof shall have received cash (or securities
or other property satisfactory to such holders) in full payment of such Senior
Indebtedness of the Company then outstanding. Subject to the prior payment in
full of all Senior Indebtedness of the Company, the rights of the Holders of the
Securities shall be subrogated to the rights of the holders of Senior
Indebtedness of the Company to receive any further payments or distributions of
cash, property or securities of the Company applicable to the holders of the
Senior Indebtedness of the Company until all amounts owing on the Securities
shall be paid in full; and such payments or distributions of cash, property or
securities received by the Holders of the Securities, by reason of such
subrogation, which otherwise would be paid or distributed to the holders of such
Senior Indebtedness of the Company shall, as between the Company, its creditors
other than the holders of Senior Indebtedness of the Company, and the Holders,
be deemed to be a payment by the Company to or on account of Senior Indebtedness
of the Company, it being understood that the provisions of this Article are and
are intended solely for the purpose of defining the relative rights of the
Holders, on the one hand, and the holders of the Senior Indebtedness of the
Company, on the other hand.

SECTION 1405. OBLIGATION OF THE COMPANY UNCONDITIONAL.

            Nothing contained in this Article or elsewhere in this Indenture or
in the Securities is intended to or shall impair, as among the Company, its
creditors other than the holders of Senior Indebtedness of the Company and the
Holders, the obligation of the Company, which is absolute and unconditional, to
pay to the Holders the principal of and interest on the Securities 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 and creditors of
the Company other than the holders of

                                       85
<PAGE>

Senior Indebtedness of the Company, nor shall anything herein or therein prevent
the Trustee or any Holder from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, subject to the rights, if any,
under this Article of the holders of Senior Indebtedness of the Company in
respect of cash, property or securities of the Company received upon the
exercise of any such remedy.

            Upon any payment or distribution of assets or securities of the
Company referred to in this Article, the Trustee and the Holders shall be
entitled to rely upon any order or decree of a court of competent jurisdiction
in which such dissolution, winding-up, liquidation or reorganization proceedings
are pending for the purpose of ascertaining the Persons entitled to participate
in such distribution, the holders of the Senior Indebtedness of the Company 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.

SECTION 1406. PRIORITY OF SENIOR INDEBTEDNESS UPON MATURITY.

            Upon the maturity of the principal of any Senior Indebtedness of the
Company by lapse of time, acceleration or otherwise, all matured principal of
Senior Indebtedness of the Company and interest and premium, if any, thereon
shall first be paid in full before any payment of principal or premium, if any,
or interest, if any, is made upon the Securities or before any Securities can be
acquired by the Company or any sinking fund payment is made with respect to the
Securities (except that required sinking fund payments may be reduced by
Securities acquired before such maturity of such Senior Indebtedness of the
Company).

SECTION 1407. TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS.

            The Trustee shall be entitled to all rights set forth in this
Article with respect to any Senior Indebtedness of the Company at any time held
by it, to the same extent as any other holder of Senior Indebtedness of the
Company. Nothing in this Article shall deprive the Trustee of any of its rights
as such holder.

SECTION 1408. NOTICE TO TRUSTEE TO EFFECTUATE SUBORDINATION.

            Notwithstanding the provisions of this Article or any other
provision of the Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts which would prohibit the making of any payment of
moneys to or by the Trustee unless and until a Responsible Officer of the
Trustee shall have received written notice thereof from the Company, from a
Holder or from a holder of any Senior Indebtedness of the Company or from any
representative or representatives of such holder or any trustee or trustees
under any indenture under which any instruments evidencing any such Senior
Indebtedness of the Company may have been issued and, prior to the receipt of
any such written notice, the Trustee shall be entitled, subject to Section 801,
in all respects to assume that no such facts exist; provided, however, that, if
prior to the fifth Business Day preceding the date upon which by the terms
hereof any such moneys may

                                       86
<PAGE>

become payable for any purpose, or in the event of the execution of an
instrument pursuant to Section 602 acknowledging that Securities or portions
thereof are deemed to have been paid for all purposes of this Indenture,
acknowledging that the entire indebtedness of the Company in respect thereof has
been satisfied and discharged or acknowledging satisfaction and discharge of
this Indenture, then if prior to the second Business Day preceding the date of
such execution, the Trustee shall not have received with respect to such moneys
the notice provided for in this Section, then, anything herein contained to the
contrary notwithstanding, the Trustee may, in its discretion, receive such
moneys and/or 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; provided, however, that no such application shall affect
the obligations under this Article of the persons receiving such moneys from the
Trustee.

SECTION 1409. MODIFICATION, EXTENSION, ETC. OF SENIOR INDEBTEDNESS OF THE
              COMPANY.

            The holders of Senior Indebtedness of the Company may, without
affecting in any manner the subordination of the payment of the principal of and
premium, if any, and interest, if any, on the Securities, at any time or from
time to time and in their absolute discretion, agree with the Company to change
the manner, place or terms of payment, change or extend the time of payment of,
or renew or alter, any Senior Indebtedness of the Company, or amend or
supplement any instrument pursuant to which any Senior Indebtedness of the
Company is issued, or exercise or refrain from exercising any other of their
rights under the Senior Indebtedness of the Company including, without
limitation, the waiver of default thereunder, all without notice to or assent
from the Holders or the Trustee.

SECTION 1410. TRUSTEE HAS NO FIDUCIARY DUTY TO HOLDERS OF SENIOR INDEBTEDNESS OF
              THE COMPANY.

            With respect to the holders of Senior Indebtedness of the Company,
the Trustee undertakes to perform or to observe only such of its covenants and
objectives as are specifically set forth in this Indenture, and no implied
covenants or obligations with respect to the holders of Senior Indebtedness of
the Company 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 of the Company, and shall not be liable to any such holders if it
shall mistakenly pay over or deliver to the Holders or the Company or any other
Person, money or assets to which any holders of Senior Indebtedness of the
Company shall be entitled by virtue of this Article or otherwise.

SECTION 1411. PAYING AGENTS OTHER THAN THE TRUSTEE.

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

                                       87
<PAGE>

however, that Sections 1407, 1408 and 1410 shall not apply to the Company if it
acts as Paying Agent.

SECTION 1412. RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS NOT IMPAIRED.

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

SECTION 1413. EFFECT OF SUBORDINATION PROVISIONS; TERMINATION.

            Notwithstanding anything contained herein to the contrary, other
than as provided in the immediately succeeding sentence, all the provisions of
this Indenture shall be subject to the provisions of this Article, so far as the
same may be applicable thereto.

            Notwithstanding anything contained herein to the contrary, the
provisions of this Article Fourteen shall be of no further effect and the
Securities shall no longer be subordinated in right of payment to the prior
payment of such Senior Indebtedness of the Company if the Company shall have
delivered to the Trustee a notice to such effect. Any such notice delivered by
the Company shall not be deemed to be a supplemental indenture for purposes of
Article Twelve hereof.

                                 ARTICLE FIFTEEN

                EXCHANGE OF PREFERRED SECURITIES FOR SECURITIES

SECTION 1501. EXCHANGE OF PREFERRED SECURITIES FOR SECURITIES.

            (a)   If at any time the Company or any of its Affiliates (in either
case, a "Company Affiliated Owner/Holder") is the owner or Holder of any
Preferred Securities of a Trust, such Company Affiliated Owner/Holder shall have
the right to deliver to the Institutional Trustee of such Trust all or such
portion of its Preferred Securities as it elects and receive, in exchange
therefore, a like amount of Securities. Such election (i) shall be exercisable
effective on any Interest Payment Date by such Sponsor Affiliated Owner/Holder
delivering to the Institutional Trustee a written notice of such election
specifying the liquidation amount of Preferred Securities with respect to which
such election is being made and the Interest Payment Date on which such exchange
shall occur, which Interest Payment Date shall be not less than ten Business
Days after the date of receipt by the Institutional Trustee or its designee the
Preferred Securities which are the subject of such election by 10:00 A.M. New
York time, on the Interest Payment Date on which such exchange is to occur.
After the exchange, such Preferred Securities will be canceled and will no

                                       88
<PAGE>

longer be deemed to be outstanding and all rights of the Company or its
Affiliate(s) with respect to such Preferred Securities will cease.

            (b)   In the case of an exchange described in Section 1501(a), the
Trust will, on the date of such exchange, exchange Securities having a principal
amount equal to the aggregate liquidation amount of the outstanding Common
Securities of such Trust, multiplied by the ratio of the aggregate liquidation
amount of the Preferred Securities exchanged pursuant to Section 1501(a) divided
by the aggregate liquidation amount of the Preferred Securities outstanding
immediately prior to such exchange, for such proportional amount of Common
Securities held by the Sponsor (which contemporaneously shall be canceled and no
longer be deemed to be outstanding); provided, that the Sponsor delivers or
caused to be delivered to the Institutional Trustee or its designee the required
amount of Common Securities to be exchanged by 10:00 A.M. New York time, on the
Interest Payment Date on which such exchange is to occur.

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

                                       89
<PAGE>

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

                                        AVISTA CORPORATION

                                        By:     /s/ Malyn K. Malquist
                                            ------------------------------------
                                            Name:  Malyn K. Malquist
                                            Title: Senior Vice President,
                                                     Chief Financial Officer and
                                                     Treasurer

                                        UNION BANK OF CALIFORNIA, N.A., Trustee

                                        By:     /s/ Sonia N. Flores
                                            ------------------------------------
                                            Name:  Sonia N. Flores
                                            Title: Vice President