<PAGE>




                                   INDENTURE






             AMERICAN BUSINESS FINANCIAL SERVICES, INC., as obligor






                          Senior Collateralized Notes






                                $100,000,000.00






         U.S. BANK NATIONAL ASSOCIATION, a national banking association






                                   as trustee





                          Dated as of December 31, 2003
<PAGE>
                               TABLE OF CONTENTS



<TABLE>
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<S>                       <C>
ARTICLE I. DEFINITIONS AND INCORPORATION BY REFERENCE .....................................................................   1
   Section 1.1            Definitions .....................................................................................   1
   Section 1.2            Other Definitions ...............................................................................   5
   Section 1.3            Incorporation by Reference of Trust Indenture Act. ..............................................   5
   Section 1.4            Rules of Construction ...........................................................................   5

ARTICLE II. THE SECURITIES ................................................................................................   6
   Section 2.1            Unlimited Amount; Accounts; Interest; Maturity. .................................................   6
   Section 2.2            Transaction Statement. ..........................................................................   7
   Section 2.3            Registrar and Paying Agent. .....................................................................   7
   Section 2.4            Paying Agent to Hold Money in Trust. ............................................................   7
   Section 2.5            Securityholder Lists. ...........................................................................   8
   Section 2.6            Transfer and Exchange. ..........................................................................   8
   Section 2.7            Payment of Principal and Interest; Principal and Interest Rights Preserved. .....................   8
   Section 2.8            Reserved. .......................................................................................   9
   Section 2.9            Outstanding Senior Collateralized Notes. ........................................................   9
   Section 2.10           Treasury Senior Collateralized Notes. ...........................................................   9
   Section 2.11           Reserved. .......................................................................................   9
   Section 2.12           Reserved. .......................................................................................   9
   Section 2.13           Defaulted Interest. .............................................................................   9
   Section 2.14           Book Entry Registration. ........................................................................   10
   Section 2.15           Initial and Periodic Statements. ................................................................   10

ARTICLE III. REDEMPTION ...................................................................................................   11

ARTICLE IV. COVENANTS .....................................................................................................   11
   Section 4.1            Payment of Senior Collateralized Notes. .........................................................   11
   Section 4.2            Maintenance of Office or Agency. ................................................................   12
   Section 4.3            SEC Reports and Other Reports. ..................................................................   12
   Section 4.4            Compliance Certificate. .........................................................................   13
   Section 4.5            Stay, Extension and Usury Laws. .................................................................   13
   Section 4.6            Liquidation. ....................................................................................   13
   Section 4.7            Limitation on Liens. ............................................................................   14

ARTICLE V. SUCCESSORS .....................................................................................................   14
   Section 5.1            When the Company May Merge, etc. ................................................................   14
   Section 5.2            Successor Corporation Substituted. ..............................................................   14

ARTICLE VI. DEFAULTS AND REMEDIES .........................................................................................   14
   Section 6.1            Events of Default. ..............................................................................   14
   Section 6.2            Acceleration. ...................................................................................   15
   Section 6.3            Other Remedies. .................................................................................   15
   Section 6.4            Waiver of Past Defaults. ........................................................................   15
   Section 6.5            Control by Majority. ............................................................................   16
   Section 6.6            Limitation on Suits. ............................................................................   16
   Section 6.7            Rights of Holders to Receive Payment. ...........................................................   16
   Section 6.8            Collection Suit by Trustee. .....................................................................   16
   Section 6.9            Trustee May File Proofs of Claim. ...............................................................   16
   Section 6.10           Priorities. .....................................................................................   17
   Section 6.11           Undertaking for Costs. ..........................................................................   17

ARTICLE VII. TRUSTEE ......................................................................................................   18
   Section 7.1            Duties of Trustee. ..............................................................................   18
   Section 7.2            Rights of Trustee. ..............................................................................   18
   Section 7.3            Individual Rights of Trustee. ...................................................................   19
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                                       i

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<TABLE>
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<S>                       <C>
   Section 7.4            Trustee's Disclaimer. ...........................................................................   19
   Section 7.5            Notice of Defaults. .............................................................................   19
   Section 7.6            Reports by Trustee to Holders. ..................................................................   19
   Section 7.7            Compensation and Indemnity. .....................................................................   19
   Section 7.8            Replacement of Trustee. .........................................................................   20
   Section 7.9            Successor Trustee by Merger, etc. ...............................................................   21
   Section 7.10           Eligibility; Disqualification. ..................................................................   21
   Section 7.11           Preferential Collection of Claims Against Company. ..............................................   21

ARTICLE VIII. DISCHARGE OF INDENTURE ......................................................................................   21
   Section 8.1            Termination of Company's Obligations. ...........................................................   21
   Section 8.2            Application of Trust Money. .....................................................................   22
   Section 8.3            Repayment to Company. ...........................................................................   22
   Section 8.4            Reinstatement. ..................................................................................   22

ARTICLE IX. AMENDMENTS ....................................................................................................   23
   Section 9.1            Without Consent of Holders. .....................................................................   23
   Section 9.2            With Consent of Holders. ........................................................................   23
   Section 9.3            Compliance with Trust Indenture Act. ............................................................   24
   Section 9.4            Revocation and Effect of Consents. ..............................................................   24
   Section 9.5            Notation on or Exchange of Senior Collateralized Notes. .........................................   24
   Section 9.6            Trustee to Sign Amendments, etc. ................................................................   24

ARTICLE X. SUBORDINATION ..................................................................................................   25
   Section 10.1           Agreement to Subordinate. .......................................................................   25
   Section 10.2           Liquidation; Dissolution; Bankruptcy. ...........................................................   25
   Section 10.3           Default of Senior Debt. .........................................................................   26
   Section 10.4           When Distribution Must Be Paid Over. ............................................................   26
   Section 10.5           Notice by Company. ..............................................................................   27
   Section 10.6           Subrogation. ....................................................................................   27
   Section 10.7           Relative Rights. ................................................................................   27
   Section 10.8           Subordination May Not Be Impaired by the Company or Holders of
                            Senior Debt....................................................................................   27
   Section 10.9           Distribution or Notice to Representative. .......................................................   28
   Section 10.10          Rights of Trustee and Paying Agent. .............................................................   28
   Section 10.11          Authorization to Effect Subordination. ..........................................................   28
   Section 10.12          Article Applicable to Paying Agent. .............................................................   29
   Section 10.13          Miscellaneous. ..................................................................................   29

ARTICLE XI. COLLATERAL AND COLLATERAL DOCUMENTS ...........................................................................   29
   Section 11.1           Collateral and Collateral Documents. ............................................................   29
   Section 11.2           Possession, Use and Release of Collateral. ......................................................   29
   Section 11.3           Opinion of Counsel. .............................................................................   30
   Section 11.4           Further Assurances. .............................................................................   30
   Section 11.5           Trust Indenture Act Requirements. ...............................................................   30
   Section 11.6           Suits to Protect the Collateral. ................................................................   30
   Section 11.7           Purchaser Protected. ............................................................................   31
   Section 11.8           Powers Exercisable by Receiver or Trustee. ......................................................   31
   Section 11.9           Release upon Termination of Company's Obligations. ..............................................   31

ARTICLE XII. MISCELLANEOUS ................................................................................................   31
   Section 12.1           Trust Indenture Act Controls. ...................................................................   31
   Section 12.2           Notices. ........................................................................................   31
   Section 12.3           Communication by Holders with Other Holders. ....................................................   32
   Section 12.4           Certificate and Opinion as to Conditions Precedent. .............................................   32
   Section 12.5           Statements Required in Certificate or Opinion. ..................................................   33
</TABLE>



                                       ii

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   Section 12.6           Rules by Trustee and Agents. ....................................................................   33
   Section 12.7           Legal Holidays. .................................................................................   33
   Section 12.8           No Recourse Against Others. .....................................................................   33
   Section 12.9           Duplicate Originals. ............................................................................   33
   Section 12.10          Governing Law. ..................................................................................   33
   Section 12.11          No Adverse Interpretation of Other Agreements. ..................................................   33
   Section 12.12          Successors. .....................................................................................   33
   Section 12.13          Severability. ...................................................................................   34
   Section 12.14          Counterpart Originals. ..........................................................................   34
   Section 12.15          Table of Contents, Headings, etc. ...............................................................   34
   Section 12.16          Time. ...........................................................................................   34
</TABLE>



                                      iii

<PAGE>
                             CROSS-REFERENCE TABLE*



Trust Indenture                                                      Indenture
Act Section                                                           Section
310(a)(1) ......................................................        7.10
  (a)(2) .......................................................        7.10
  (a)(3) .......................................................        N.A.
  (a)(4) .......................................................        N.A.
  (a)(5) .......................................................        N.A.
  (b) ..........................................................     7.8; 7.10
  (c) ..........................................................        N.A.
311(a) .........................................................        7.11
  (b) ..........................................................        7.11
  (c) ..........................................................        N.A.
312(a) .........................................................        2.5
  (b) ..........................................................        12.3
  (c) ..........................................................        12.3
313(a) .........................................................        7.6
  (b)(1) .......................................................        N.A.
  (b)(2) .......................................................        7.6
  (c) ..........................................................     7.6; 12.2
  (d) ..........................................................        7.6
314(a) .........................................................   4.3; 4.4;12.2
  (b) ..........................................................        N.A.
  (c)(1) .......................................................        12.4
  (c)(2) .......................................................        12.4
  (c)(3) .......................................................        N.A.
  (d) ..........................................................        N.A.
  (e) ..........................................................        12.5
  (f) ..........................................................        N.A.
315(a) .........................................................       7.1(b)
  (b) ..........................................................     7.5; 12.2
  (c) ..........................................................       7.1(a)
  (d) ..........................................................       7.1(c)
  (e) ..........................................................        6.11
316(a)(last sentence) ..........................................        2.10
  (a)(1)(A) ....................................................        6.5
  (a)(1)(B) ....................................................        6.4
  (a)(2) .......................................................        N.A.
  (b) ..........................................................        6.7
  (c) ..........................................................        N.A.
317(a)(1) ......................................................        6.8
  (a)(2) .......................................................        6.9
  (b) ..........................................................        2.4
318(a) .........................................................        12.1


   N.A. means not applicable

   * This Cross Reference Table is not part of the Indenture


                                       iv

<PAGE>
   INDENTURE dated as of December 31, 2003, by American Business Financial
Services, Inc., a Delaware corporation (the "Company"), and U.S. Bank National
Association, a national banking association, as trustee (the "Trustee").

   The Company and the Trustee agree as follows for the benefit of each other
and for the equal and ratable benefit of the Holders of the Senior
Collateralized Notes of the Company issued pursuant to the Company's Offer to
Exchange dated December 1, 2003, as amended, and the Application for
Qualification of Indenture on Form T-3.

                                   ARTICLE I.
                         DEFINITIONS AND INCORPORATION
                                  BY REFERENCE


Section 1.1 Definitions.

   "Account" means the record of beneficial ownership of a Senior
Collateralized Note maintained by the Company.

   "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" (including, with correlative meanings, the terms "controlling,"
"controlled by" and "under common control with"), as used with respect to any
Person, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of such Person,
whether through the ownership of voting securities, by agreement or otherwise.

   "Agent" means any Registrar, Paying Agent or co-registrar of the Senior
Collateralized Notes.

   "Bankruptcy Law" means the United States Bankruptcy Code (Title II U.S.
Code) and other federal or state insolvency laws as amended from time to time.

   "Board of Directors" means the Board of Directors of the Company or any
authorized committee of the Board of Directors.

   "Business Day" means any day other than a Legal Holiday.

   "Collateral" means the tangible and intangible property, assets and
interests of the Company or its Affiliates that are pledged, or in which a
security interest has been granted to secure the repayment of the obligations,
pursuant to the Collateral Documents, including all of the assets that are
subject to Priority Liens.

   "Collateral Coverage Ratio" means, at the end of each quarterly balance
sheet date, the ratio of (i) the value of the Collateral securing the Senior
Collateralized Notes to (ii) the outstanding aggregate principal balance owing
on the Senior Collateralized Notes issued under this Indenture plus all other
Priority Lien Obligations, as determined by the Company.

   "Collateral Documents" means each security agreement by and between the
Trustee (on behalf of the Securityholders), and the Company or its Affiliates,
and each security agreement or other document executed by the Company or its
Affiliates creating a Lien that, after giving effect to such transfer, secures
the Senior Collateralized Notes, each as may be amended, supplemented or
otherwise modified from time to time.

   "Company" means American Business Financial Services, Inc., unless and until
replaced by a successor in accordance with Article V hereof and thereafter
means such successor.

   "Corporate Trust Office" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date as of which this
Indenture is originally dated, located at Mail Code EP-MN-WS3C, 60 Livingston
Avenue, Saint Paul, Minnesota 55107, Attention: Mr. Richard Prokosch,
Corporate Finance.

   "Credit Agreement" or "Credit Agreements" means any credit agreement entered
into hereafter which evidences and/or establishes Senior Debt to or for the
benefit of the Company.


                                      A-1

<PAGE>
   "Custodian" means any receiver, trustee, assignee, liquidator or similar
official under any Bankruptcy Law.

   "Default" means any event, not subject to cure, that is or with the passage
of time or the giving of notice or both would be an Event of Default.

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

   "Exchanged Notes" means up to $200,000,000 in aggregate principal amount of
investment notes issued by the Company under indentures prior to April 1,
2003, which have been tendered by the Holder, and accepted by the Company, in
exchange for a Senior Collateralized Note.

   "Fiscal Year" means initially a June 30 year end.

   "GAAP" means, as of any date, generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant segment of the
accounting profession, which are in effect from time to time.

   "Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.

   "Holder" or "Securityholder" means a Person in whose name a Senior
Collateralized Note is registered.

   "Indebtedness" means, with respect to any Person, any indebtedness of such
Person, whether or not contingent, in respect of borrowed money or evidenced
by bonds, notes, debentures or similar instruments or letters of credit (or
reimbursement agreements in respect thereof) or representing the balance
deferred and unpaid of the purchase price of any property (including capital
lease obligations) or representing any hedging obligations, except any such
balance that constitutes an accrued expense or a trade payable, if and to the
extent any of the foregoing indebtedness (other than letters of credit and
hedging obligations) would appear as a liability upon a balance sheet of such
Person prepared in accordance with GAAP, and also includes, to the extent not
otherwise included, (a) the Guarantee of items that would be included within
this definition, and (b) liability for items that would arise by operation of
a Person's status as a general partner of a partnership.

   "Indenture" means, this Indenture as amended or supplemented from time to
time.

   "Interest Accrual Date" means with respect to any Senior Collateralized
Note, the date the Company accepts the tender of the investment notes and
issues the Senior Collateralized Note.

   "Interest Accrual Period" means, as to each Senior Collateralized Note, the
period from the later of the Interest Accrual Date of such Senior
Collateralized Note or the day after the last Payment Date upon which an
interest payment was made until the following Payment Date during which
interest accrues on each Senior Collateralized Note with respect to any
Payment Date.

   "Issue Date" means, with respect to any Senior Collateralized Note, the date
on which the Senior Collateralized Notes are initially registered on the books
and records of the Registrar.

   "Lien" means, with respect to any asset, any mortgage, lien, pledge, charge,
security interest or encumbrance of any kind in respect of such asset, whether
or not filed, recorded or otherwise perfected under applicable law (including
any conditional sale or other title retention agreement, any lease in the
nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement
under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction.)

   "Maturity Date" means, with respect to any Senior Collateralized Note, the
date on which the principal of such Senior Collateralized Note becomes due and
payable as therein provided.


                                      A-2

<PAGE>
   "Maturity Record Date" means, with respect to any Senior Collateralized
Note, as of 11:59 p.m. of the date 20 days prior to the Maturity Date or
Redemption Date applicable to such Senior Collateralized Note.

   "Note Lien" means a Lien granted pursuant to the Collateral Documents as
security for the Note Obligations and subordinated and subject to the rights
and remedies of the holders of the Priority Liens in accordance with the terms
of the Collateral Documents and any lien subordination agreement that may be
required by the holders of the Priority Liens.

   "Note Obligations" means the Obligations of the Company under the Senior
Collateralized Notes.

   "Obligations" means any principal, interest (including Post-Petition
Interest), penalties, fees, indemnifications, reimbursements, damages and
other liabilities payable under the documentation governing any Indebtedness.

   "Officer" means the Chairman of the Board or principal executive officer of
the Company, the President or operating officer of the Company, the Chief
Financial Officer or principal financial officer of the Company, the
Treasurer, any Assistant Treasurer, Controller or principal officer of the
Company, Secretary or any Vice-President of the Company.

   "Officers' Certificate" means a certificate signed by two Officers, one of
whom must be the principal executive officer, principal operating officer,
principal financial officer or principal accounting officer of the Company.

   "Opinion of Counsel" means an opinion from legal counsel who is reasonably
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company or the Trustee.

   "Payment Date" means the last day of each calendar month or such other date
as determined by the Holder and the Company or if such day is not a Business
Day, the Business Day immediately following such day and, with respect to a
specific Senior Collateralized Note, the Maturity Date or Redemption Date of
such Senior Collateralized Note.

   "Permitted Liens" means: (i) Liens in favor of the Company; (ii) Liens
securing Senior Debt of the Company existing as of the date hereof; (iii)
Liens securing Senior Debt incurred after the date hereof including without
limitation Priority Liens; (iv) Liens on property of a Person existing at the
time such Person is merged into, consolidated with or otherwise acquired by
the Company, provided that such Liens were not created in contemplation of
such merger, consolidation or acquisition and do not extend to any assets
other than those of the Person merged into or consolidated with the Company;
(v) Liens on property existing at the time of acquisition thereof by the
Company; provided that such Liens were not created in contemplation of such
acquisition and do not extend to any other assets of the Company; (vi) Liens
on the property of the Company Incurred in the ordinary course of business to
secure performance of obligations with respect to statutory or regulatory
requirements, performance or return-of-money bonds, surety bonds or other
obligations of a like nature and incurred in a manner consistent with industry
practice, in each case which are not Incurred in connection with the borrowing
of money, the obtaining of advances or credit or the payment of the deferred
purchase price of property and which do not in the aggregate impair in any
material respect the use of property in the operation of the business of the
Company taken as a whole unless in connection with the Senior Debt; (vii)
Liens existing on the date of this Indenture; (viii) Liens for taxes,
assessments or governmental charges or claims that are not yet delinquent or
that or are being contested in good faith and by appropriate proceedings
promptly instituted and diligently concluded; (ix) Liens, incurred in good
faith in the ordinary course of business with respect to amounts not yet
delinquent or being contested in good faith by appropriate proceedings; (x)
judgment Liens; (xi) Liens to secure the payment of all or a part of the
purchase price of property or assets acquired or constructed in the ordinary
course of business on or after the date of this Indenture, provided that (a)
such property or assets are used in the same or a similar line of business as
the Company was engaged in on the date of this Indenture, (b) at the time of
incurrence of any such Lien, the aggregate principal amount of the obligations
secured by such Lien shall not exceed the cost of the assets or property (or
portions thereof) so acquired and constructed, (c) each such Lien shall
encumber only the assets or property (or portions thereof) so acquired or
constructed and shall attach to such property within 120 days of the purchase
or construction thereof and (d) any Indebtedness secured by such Lien shall
have been permitted to be incurred hereunder; (xii) precautionary filings of
any financing statement under the

                                      A-3



<PAGE>

Uniform Commercial Code (or equivalent statutes) of any jurisdiction made in
connection with capital lease obligations; (xiii) Note Liens; (xiv) Liens
permitted by the Collateral Documents, including, without limitation, Priority
Liens; (xv) Liens incurred in the ordinary course of business in connection
with (a) worker's compensation, social security, unemployment insurance and
other like laws or (b) sales contract's leases, statutory obligations, work in
progress advances and other similar obligations not incurred in connection
with the borrowing of money or the payment of the deferred, purchase price of
property; (xvi) Liens on insurance policies and the proceeds thereof securing
the financing of the premiums with respect thereto; (xvii) Liens consisting of
rights of set-off of a customary nature or banker's liens on amounts on
deposit in accounts, whether arising by contract or operation of law, incurred
in the ordinary course of business; and (xviii) Liens granted in the ordinary
course of business of the Company.

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

   "Post-Petition Interest" means interest accruing after the commencement of
any bankruptcy or insolvency case or proceeding with respect to the Company or
any receivership, liquidation, reorganization or other similar case or
proceeding in connection therewith, at the rate applicable to such
Indebtedness, whether or not such interest is an allowable claim in any such
proceeding.

   "Priority Lien" means any Lien which has been granted by the Company or its
Affiliate to any lender pursuant to the Priority Lien Documents that is senior
in priority to the Note Liens.

   "Priority Lien Documents" means the Credit Agreements, the Priority Lien
Security Documents and, in connection with or pursuant to any of the
foregoing, all other agreements, certificates or documents executed by the
Company or its Affiliate and delivered to the trustee, agent or representative
acting for the lenders party to the Credit Agreements each, as may be amended,
supplemented or otherwise modified from time to time.

   "Priority Lien Obligations" means the Indebtedness evidenced by the Credit
Agreements and all other obligations of the Company thereunder or under the
Priority Lien Documents in respect of the Credit Agreements.

   "Priority Lien Security Documents" means one or more security agreements,
pledge agreements, collateral assignments, mortgages, deed of trust or other
grants or transfers for security executed and delivered by the Company or its
Affiliates creating a Lien upon property owned or to be acquired by the
Company or its Affiliates in favor of any lenders party to the Credit
Agreements, or any trustee, agent or representative acting for any such
holders, as security for any Priority Lien Obligations each, as may be
amended, supplemented or otherwise modified from time to time.

   "Redemption Date" has the meaning given in Article III hereof.

   "Redemption Price" means, with respect to any Senior Collateralized Note to
be redeemed, the principal amount of such Senior Collateralized Note plus the
interest accrued but unpaid during the Interest Accrual Period up to the
Redemption Date for such security.

   "Regular Record Date" means, with respect to each Payment Date, as of 11:59
p.m. of the date 15 days prior to such Payment Date.

   "Responsible Officer" means any officer in its Corporate Trust Office, or
any other assistant officer of the Trustee in its Corporate Trust Office
customarily performing functions similar to those performed by the Persons who
at the time shall be such officers, respectively, or to whom any corporate
trust matter is referred because of his or her knowledge of and familiarity
with the particular subject.

   "SEC" means the U.S. Securities and Exchange Commission.

   "Senior Collateralized Note" or "Senior Collateralized Notes" means the
Company's secured subordinated debt issued under this Indenture substantially
in the form of Exhibit "A" attached hereto and made part hereof.


                                      A-4

<PAGE>
   "Senior Debt" means any Indebtedness (whether outstanding on the date hereof
or thereafter created) incurred by the Company in connection with borrowings
by the Company (including its subsidiaries) from a bank, trust company,
insurance company, any other institutional lender or other entity which lends
funds in connection with its primary business activities whether such
Indebtedness is or is not specifically designated by the Company as being
"Senior Debt" in its defining instruments.

   "TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss. 77aaa-77bbbb)
as in effect on the date on which this Indenture is qualified under the TIA.

   "Trustee" means U.S. Bank National Association, a national banking
association, until a successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter means the successor serving
hereunder.

   "Uniform Commercial Code" means the Uniform Commercial Code as in effect
from time to time in the State of Delaware.

   "U.S. Government Obligations" means direct obligations of the United States
of America, or any agency or instrumentality thereof for the payment of which
the full faith and credit of the United States of America is pledged.

Section 1.2 Other Definitions.

                     Term                                    Defined in Section
          -----------------------------------------------    ------------------
          "Event of Default"                                         6.1
          "Legal Holiday"                                           12.7
          "Paying Agent"                                             2.3
          "Payment Blockage Period"                                 10.3
          "Payment Notice"                                          10.3
          "Registrar"                                                2.3
          "Securities Register"                                     2.14

Section 1.3 Incorporation by Reference of Trust Indenture Act.

   Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:

      "indenture securities" means the Senior Collateralized Notes;

      "indenture security holder" means a Securityholder;

      "indenture to be qualified" means this Indenture;

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

      "obligor" on the Senior Collateralized Notes means the Company or any
successor obligor upon the Senior Collateralized Notes.

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

Section 1.4 Rules of Construction.

   Unless the context otherwise requires:

      1. a term has the meaning assigned to it;

                                      A-5

<PAGE>
      2. an accounting term not otherwise defined has the meaning assigned to
   it in accordance with GAAP;

      3. references to GAAP, as of any date, shall mean GAAP in effect in the
   United States as of such date;

      4. "or" is not exclusive,

      5. words in the singular include the plural, and in the plural include
   the singular; and

      6. provisions apply to successive events and transactions.

                                  ARTICLE II.
                                 THE SECURITIES

Section 2.1 Unlimited Amount; Accounts; Interest; Maturity.


   The outstanding aggregate principal amount of Senior Collateralized Notes
outstanding at any time is limited to $100 million, provided, however, no
amount can be issued unless the Collateral Coverage Ratio is at least 1.5 to 1
and provided further that the Company and the Trustee may, without the consent
of any Holder, increase such aggregate principal amount of Senior
Collateralized Notes which may be outstanding at any time if after giving
effect to the additional indebtedness the Collateral Coverage Ratio is at
least 1.5 to 1. The Senior Collateralized Notes may be subject to notations,
legends or endorsements required by law, stock exchange rule, agreements to
which the Company is subject or usage.

   Except as provided in Section 2.14 hereof, each Senior Collateralized Note
shall not be evidenced by a promissory note. The record of beneficial
ownership of the Senior Collateralized Notes shall be maintained and updated
by the Company through the establishment and maintenance of Accounts. Each
Senior Collateralized Note shall be in such denominations as may be designated
from time to time by the Company but in no event in an original denomination
less than $1,000; provided that the Company may, in its sole discretion, waive
this requirement. Separate purchases may not be cumulated to satisfy the
minimum denomination requirements. Each Senior Collateralized Note issued in
exchange for Exchanged Notes with remaining terms to maturity of 36 months or
less, shall have a term equal to the greater of 12 months or the remaining
term to maturity of the Exchanged Notes tendered. Each Senior Collateralized
Note issued in exchange for Exchanged Notes with remaining terms to maturity
of greater than 36 months shall have a term to maturity of 36 months or the
remaining term to maturity of the Exchanged Notes tendered, as determined by
the Holder. If the Holder fails to select a maturity date, the maturity date
will be the remaining term to maturity of the Exchanged Notes. If Exchanged
Notes with various maturities are tendered, the Senior Collateralized Notes
issued will have maturities consistent with the maturities of the old
debentures tendered. In addition, the term of Senior Collateralized Notes will
not automatically rollover or convert to new notes as may have been set forth
in the Exchanged Note. Following the one year anniversary of the issuance of
the Senior Collateralized Note, each Senior Collateralized Note shall be
redeemable by the Company upon 90 days written notice to the Holder thereof.

   Each Senior Collateralized Note shall bear interest from and commencing on
its Interest Accrual Date at a rate of interest which is ten (10) basis points
in excess of the interest rate currently being paid by the Company to the Holder
on the Exchanged Note.

   Interest on any Senior Collateralized Note shall compound, and shall be
payable in accordance with its periodic interest payment terms which terms
shall reflect the periodic interest payment terms of the Exchanged Note. To
the extent any applicable Payment Date is not a Business Day, then interest
shall be paid instead on the next succeeding Business Day.

   Senior Collateralized Notes may not be redeemed by a Holder prior to the
Stated Maturity Date.

   Each Senior Collateralized Note with a remaining duration of one year or
greater is subject to early redemption at the election (a) of the estate of a
Holder, who is a natural person, only upon the death of such Holder, or (b) if
such Senior Collateralized Note is held jointly by a husband and wife, of a
Holder upon the death of such Holder's spouse. This redemption provision does
not apply to a Holder who is not a natural



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Person such as a trust, partnership, limited liability entity, or corporation.
The Company may modify its policy on redemptions after death provided that any
change in such policy shall not effect any outstanding Senior Collateralized
Note.

   The terms and provisions contained in the Senior Collateralized Notes shall
constitute, and are hereby expressly made, a part of this Indenture and to the
extent applicable, the Company and the Trustee, by their execution and
delivery of this Indenture, and the Holders by accepting the Senior
Collateralized Notes, expressly agree to such terms and provisions and to be
bound thereby. In case of a conflict, the provisions of this Indenture shall
control.

Section 2.2 Transaction Statement.

   A Senior Collateralized Note shall not be validly issued until a transaction
statement executed by a duly authorized officer of the Company is sent to the
holder of a validly tendered Exchanged Note or transferee thereof and an
Account is established by the Company in the name of such holder of a validly
tendered Exchanged Note or transferee.

Section 2.3 Registrar and Paying Agent.

   The Company shall maintain (i) an office or agency where Senior
Collateralized Notes may be presented for registration of transfer or for
exchange ("Registrar") and (ii) an office or agency where Senior
Collateralized Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a Securities Register of the Senior Collateralized Notes
and of their transfer and exchange. The Company may appoint one or more co-
registrars and one or more additional Paying Agents. The term "Registrar"
includes any co-registrar, and the term "Paying Agent" includes any additional
paying agent. The Company may change any Paying Agent or Registrar without
prior notice to any Securityholder; provided that the Company shall promptly
notify the Securityholders of the name and address of any Agent not a party to
this Indenture. The Company may act as Paying Agent and/or Registrar. In the
event the Company uses any Agent other than the Company or the Trustee, the
Company shall enter into an appropriate agency agreement with such Agent,
which agreement shall incorporate the provisions of the TIA. The agreement
shall implement the provisions of this Indenture that relate to such Agent.
The Company shall notify the Trustee of the name and address of any such
Agent. If the Company fails to maintain a Registrar or Paying Agent, or fails
to give the foregoing notice, the Trustee shall act as such, and shall be
entitled to appropriate compensation in accordance with Section 7.7 hereof.

   The Company shall be the initial Registrar and Paying Agent. The Company
initially appoints Trustee as agent for service of notices and demands in
connection with the Senior Collateralized Notes. The Company shall act as
Registrar and Paying Agent until such time as the Company gives the Trustee
written notice to the contrary.

Section 2.4 Paying Agent to Hold Money in Trust.

   Prior to each due date of the principal or interest on any Senior
Collateralized Note, the Company shall deposit with the Paying Agent
sufficient funds to pay principal, premium, if any, and interest then so
becoming due and payable in cash. The Company shall require each Paying Agent
other than the Trustee to agree in writing that the Paying Agent will hold in
trust for the benefit of Securityholders and the Trustee all money held by the
Paying Agent for the payment of principal or interest on the Senior
Collateralized Notes, and will notify the Trustee promptly in writing of any
default by the Company in making any such payment. While any such default
continues, the Trustee shall require a Paying Agent (if other than the
Company) to pay all money held by it to the Trustee. The Company at any time
may require a Paying Agent to pay all money held by it to the Trustee. Upon
payment over to the Trustee, the Paying Agent (if other than the Company)
shall have no further liability for the money delivered to the Trustee. If the
Company acts as Paying Agent, it shall segregate and hold in a separate trust
fund for the benefit of the Securityholders all money held by it as Paying
Agent. The Company shall notify the Trustee in writing at least five days
before the Payment Date of the name and address of the Paying Agent if a
Person other than the Company is named Paying Agent at any time or from time
to time.




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Section 2.5 Securityholder Lists.

   The Trustee shall preserve in as current a form as is reasonably practicable
the most recent list available to it of the names and addresses of
Securityholders and shall otherwise comply with TIA ss.312(a). If the Trustee
is not the Registrar, the Company shall furnish to the Trustee each quarter
during the term of this Indenture and at such other times as the Trustee may
request in writing, a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of Securityholders, and the
aggregate principal amount outstanding and the Company shall otherwise comply
with TIA ss.312(a).

Section 2.6 Transfer and Exchange.

   (a) The Senior Collateralized Notes are not negotiable instruments and
cannot be transferred without the prior written consent of the Company (which
consent shall not be unreasonably withheld). Requests to the Registrar for the
transfer of the Accounts maintained for the benefit of the Holders of the
Senior Collateralized Notes shall be:

      (i) made to the Registrar in writing on a form supplied by the Company;

      (ii) duly executed by the current Holder of the Account, as reflected on
           the Company's records as of the date of receipt of such transfer
           request, or the Holder's attorney duly authorized in writing;

      (iii) accompanied by the written consent of the Company to the transfer;
            and

      (iv) if requested by the Company, an opinion of Holder's counsel (which
           counsel shall be reasonably acceptable to the Company) that the
           transfer does not violate any applicable securities laws and/or a
           signature guarantee.

   Upon transfer of a Senior Collateralized Note, the Company will provide the
new Holder with an initial transaction statement which will evidence the
transfer of the Account on the Company's records.

   (b) Obligations with respect to Transfers and Exchanges of Senior
Collateralized Notes.

      (i) The Company may assess service charges to a Holder for any
          registration or transfer or exchange, and the Company may require
          payment of a sum sufficient to cover any transfer tax or similar
          governmental charge payable in connection therewith (other than any
          such transfer taxes or similar governmental charge payable upon
          exchange pursuant to Section 9.5 hereof).


      (ii) The Registrar shall treat the Person listed on each Account
           maintained by the Company as the absolute owner of the Senior
           Collateralized Note represented thereby for purposes of receiving
           payments thereon and for all other purposes whatsoever.

Section 2.7 Payment of Principal and Interest; Principal and Interest Rights
Preserved.

   (a) Each Senior Collateralized Note shall accrue interest at the rate
specified for such Senior Collateralized Note and such interest shall be
payable on each Payment Date following the Issue Date for such Senior
Collateralized Note, until the principal thereof becomes due and payable. Any
installment of interest payable on a Senior Collateralized Note that is caused
to be punctually paid or duly provided for by the Company on the applicable
Payment Date shall be paid to the Holder in whose name such Senior
Collateralized Note is registered in the Securities Register on the applicable
Regular Record Date: by (a) check or draft mailed to such Holder's address as
it appears in the Securities Register on such Regular Record Date, or (b)
electronic funds transfer (commonly referred to as a direct deposit) to an
account in the name of the Holder in a bank located in the continental United
States. The payment of any interest payable in connection with the payment of
any principal payable with respect to such Senior Collateralized Note on a
Maturity Date or Redemption Date shall be payable as provided below. Any funds
with respect to which such checks were issued which remain uncollected shall
be held in accordance with Section 8.3 hereof. Any installment of interest not
punctually paid or duly provided for shall be payable in the manner and to the
Holders specified in Section 2.13 hereof.






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   (b) Each of the Senior Collateralized Notes shall have stated maturities of
principal as shall be indicated in each such Senior Collateralized Note. The
principal of each Senior Collateralized Note shall be paid in full no later
than the Maturity Date thereof or such Senior Collateralized Note becomes due
and payable at an earlier date by acceleration, redemption or otherwise.

   Interest on each Senior Collateralized Note shall be due and payable on each
Payment Date at the interest rate applicable to such Senior Collateralized
Note for the Interest Accrual Period related to such Senior Collateralized
Note and such Payment Date.

   Notwithstanding any of the foregoing provisions with respect to payments of
principal of and interest on the Senior Collateralized Notes, if the Senior
Collateralized Notes have become or been declared due and payable following an
Event of Default, then payments of principal of and interest on the Senior
Collateralized Notes shall be made in accordance with Article VI hereof.

   The principal payment made on any Senior Collateralized Note on any Maturity
Date (or the Redemption Price of any Senior Collateralized Note required to be
redeemed), and any accrued interest thereon, shall be payable on or after the
Maturity Date or Redemption Date therefore at the office or agency of the
Company maintained by it for such purpose pursuant to Section 2.3 hereof or at
the office of any Paying Agent for such Senior Collateralized Note.

   (c) All computations of interest due with respect to any Senior
Collateralized Note shall be made, unless otherwise specified in the Senior
Collateralized Note based on a 365 or 366 day year, actual days elapsed.

Section 2.8 Reserved.

Section 2.9 Outstanding Senior Collateralized Notes.

   The aggregate principal amount of Senior Collateralized Notes outstanding at
any time shall be equal to the outstanding aggregate principal balance of all
Accounts representing the Senior Collateralized Notes maintained by the
Company or such other entity as the Company designated as Registrar.

   If the principal amount of any Senior Collateralized Note is considered paid
under Section 4.1 hereof, it ceases to be outstanding and interest on it
ceases to accrue.

   Subject to Section 2.10 hereof, a Senior Collateralized Note does not cease
to be outstanding because the Company or an Affiliate of the Company holds the
Senior Collateralized Note.

Section 2.10 Treasury Senior Collateralized Notes.

   In determining whether the Holders of the required principal amount of
Senior Collateralized Notes have concurred in any direction, waiver or
consent, Senior Collateralized Notes owned by the Company or any Affiliate of
the Company shall be considered as though not outstanding, except that for
purposes of determining whether the Trustee shall be protected in relying on
any such direction, waiver or consent, only Senior Collateralized Notes that a
Responsible Officer of the Trustee actually knows to be so owned shall be so
disregarded.

Section 2.11 Reserved.

Section 2.12 Reserved.

Section 2.13 Defaulted Interest.

   If the Company defaults in a payment of interest on any Senior
Collateralized Note, it shall pay the defaulted interest plus, to the extent
lawful, any interest payable on the defaulted interest, to the Holder of such
Senior Collateralized Note on a subsequent special record date, which date
shall be at the earliest practicable date, but in all events at least five
Business Days prior to the payment date, in each case at the rate provided in
the Senior Collateralized Note. The Company shall, with written notification
to the Trustee, fix or cause to be fixed each such special record date and
payment date. At least 15 days before any such special record date, the
Company (or the Trustee, in the name of and at the expense of the Company)
shall

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<PAGE>
mail to Securityholder(s) a notice that states the special record date, the
related payment date and the amount of such interest to be paid.

Section 2.14 Book Entry Registration.

   The Registrar shall maintain a book entry registration and transfer system
through the establishment of Accounts for the benefit of Holders of Senior
Collateralized Notes as the sole method of recording the ownership and
transfer of ownership interests in such Senior Collateralized Notes
("Securities Register"). The registered owners of the Accounts established by
the Company in connection with the purchase or transfer of the Senior
Collateralized Notes shall be deemed to be the Holders of the Senior
Collateralized Notes outstanding for all purposes under this Indenture. The
Company shall promptly notify the Registrar of the acceptance of a
subscriber's order to purchase a Senior Collateralized Note and the Registrar
shall credit the Securities Register to the Account of each Senior
Collateralized Note purchaser, the principal amount of such Senior
Collateralized Note owned of record by the purchaser. The total amount of any
principal and/or interest (which shall be paid in the form of additional
notes) due and payable to book entry owners of the Accounts maintained by the
Company as provided in this Indenture shall be credited to such Accounts by
the Company within the time frames provided in this Indenture. The Trustee
shall review the Securities Register as it deems necessary to ensure the
Company's compliance with the terms of the Indenture.

   Book-entry accounts representing interests in the Senior Collateralized
Notes shall not be exchangeable for Senior Collateralized Notes in
denominations of $1,000 (unless waived by the Company) and any amount in
excess thereof and fully registered in the names as the Company directs unless
(a) the Company at its option advises the Trustee in writing of its election
to terminate the book-entry system, or (b) after the occurrence of any Event
of Default, Holders of a majority of the Senior Collateralized Notes then
outstanding (as determined based upon the latest quarterly statement provided
to the Trustee pursuant to Section 4.3(d) hereof) advise the Trustee in
writing that the continuation of the book-entry system is no longer in the
best interests of such Holders and the Trustee notifies all Holders of the
Senior Collateralized Notes, as the case may be, of such event and the
availability of definitive notes to the Holders of Senior Collateralized
Notes, requesting such notes in definitive form.

   Upon the occurrence of an event described in (a) or (b) of this Section
2.14, the Senior Collateralized Notes shall be executed and authenticated as
follows:

   Two Officers of the Company shall sign the Senior Collateralized Notes for
the Company by manual or facsimile signature. The Company's seal shall be
reproduced on the Senior Collateralized Notes. If an Officer whose signature
is on an Senior Collateralized Note no longer holds that office at the time
the Senior Collateralized Note is authenticated by the Trustee, the Senior
Collateralized Notes shall nevertheless be valid.

   A Senior Collateralized Note shall not be valid until authenticated by the
authorized manual signature of the Trustee. The signature of the Trustee shall
be conclusive evidence that the Senior Collateralized Note has been
authenticated under this Indenture. The Trustee shall upon a written order of
the Company signed by two Officers of the Company, authenticate Senior
Collateralized Notes for original issue. The aggregate principal amount of
Senior Collateralized Note outstanding at any time may not exceed the amount
set forth in Section 2.1 hereof. Such order shall specify the amount of the
Senior Collateralized Notes to be authenticated and the date(s) upon which the
original issue thereof is to be authenticated. The Trustee may appoint an
authenticating agent acceptable to the Company to authenticate Senior
Collateralized Notes. Unless limited by the terms of such appointment, an
authenticating agent may authenticate a Senior Collateralized Note whenever
the Trustee may do so. Each reference in this Indenture to authentication by
the Trustee includes authentication by such agent. An authenticating agent has
the same rights as an Agent to deal with the Company.

Section 2.15 Initial and Periodic Statements.

   (a) The Company shall provide initial transaction statements to all holders
whose tenders of Exchanged Notes are accepted by the Company, registered
owners, registered pledgees, former registered owners and

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<PAGE>
former pledgees, within two Business Days of the purchase, transfer or pledge
of a Senior Collateralized Note.

   (b) The Company shall send each Holder (and each registered pledgee) via
U.S. mail not later than ten Business Days after each quarter end in which
such Holder had an outstanding balance in such Holder's Account, a statement
which indicates as of the calendar quarter end preceding the mailing: (a) the
balance of such Account; (b) interest credited; (c) withdrawals made, if any;
and (d) the interest rate paid on such Account during the preceding calendar
month. The Company shall provide additional statements as the Holders or
registered pledgees of the Senior Collateralized Notes may reasonably request
from time to time. The Company may charge such Holders or pledgees requesting
such statements a fee to cover the charges incurred by the Company in
providing such additional statements.

                                  ARTICLE III.
                                   REDEMPTION

   On or after the one year anniversary of the issuance date of any Senior
Collateralized Note, the Company may redeem, in whole or in part, such Senior
Collateralized Note prior to the scheduled Maturity Date of the Senior
Collateralized Note upon 90 days written notice to the Holder thereof listed
on the records maintained by the Company. In addition, except as provided in
this Article III, the Company shall have no mandatory redemption or sinking
fund obligations with respect to any of the Senior Collateralized Note.

   Upon the death of a Holder of a Senior Collateralized Note, who is a natural
Person, the estate of such Holder may require the Company to redeem, in whole
and not in part, the Senior Collateralized Note held by such Holder, who is a
natural Person, provided that such Senior Collateralized Note has a remaining
maturity of one year or greater at the time of such death by delivering to the
Company an irrevocable election (a "Redemption Election") requiring the
Company to make such redemption. In the event a Senior Collateralized Note is
held jointly by two or more natural Persons (including without limitation
joint owners that are not legally married), the Company shall not be required
to redeem such Senior Collateralized Note if either joint Holder of such
Senior Collateralized Note has died. Notwithstanding the foregoing sentence,
if a Senior Collateralized Note is held jointly by a husband and wife, such
Senior Collateralized Note shall be subject to the elective redemption
provisions of this Article III upon the death of either spouse. If the Senior
Collateralized Note is held by a Holder who is not a natural Person such as a
trust, partnership, corporation or other similar entity, the redemption upon
death does not apply. Upon receipt of a Redemption Election, the Company shall
designate the Redemption Date for such Senior Collateralized Note, which
Redemption Date shall be no more than 15 days after the Company's receipt of
the Redemption Election, and shall pay the Redemption Price to the estate of
the Holder or the Holder, as the case may be, in accordance with the
provisions set forth in Section 2.7 hereof. No interest shall accrue on a
Senior Collateralized Note to be redeemed under this Article III for any
period of time after the Redemption Date for such Senior Collateralized Note
and after the Company has tendered the Redemption Price to the Estate of the
Holder or to the Holder, as the case may be.


                                  ARTICLE IV.
                                   COVENANTS

Section 4.1 Payment of Senior Collateralized Notes.

   The Company shall duly pay the principal of and interest on each Senior
Collateralized Note on the dates and in the manner established upon issuance
of the Senior Collateralized Notes and set forth in the initial transaction
statement. The interest rate paid shall be the rate set forth in Section 2.1
of this Indenture. Principal and interest shall be considered paid on the date
due if the Paying Agent, if other than the Company, holds, at least one
Business Day before that date, money deposited by the Company in immediately
available funds and designated for and sufficient to pay all principal and
interest then due and such payment is made to the Holder on or before such
payment date; provided, however, that principal and interest shall not be
considered paid within the meaning of this Section 4.1 if money is held by the
Paying Agent for the benefit of holders of Senior Debt pursuant to the
provisions of Article X hereof. Such Paying Agent shall return to the Company,
no later than five days following the date of payment, any money

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(including accrued interest) that exceeds such amount of principal and
interest paid on the Senior Collateralized Notes in accordance with this
Section 4 1.

   To the extent lawful, the Company shall pay interest (including Post-
Petition Interest in any proceeding under any Bankruptcy Law) on overdue
principal at the rate borne by the Senior Collateralized Notes, compounded
semi-annually; it shall pay interest (including Post-Petition Interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace period) at the same rate, compounded
semi-annually.

Section 4.2 Maintenance of Office or Agency.

   The Company will maintain an office or agency (which may be an office of the
Trustee, Registrar or co-registrar) where Senior Collateralized Notes may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Senior Collateralized Notes
and this Indenture may be served. The Company will give prompt written notice
to the Trustee of the location, and any change in the location, of such office
or agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address
thereof, such presentations, surrenders, notices and demands may be made or
served at the Corporate Trust Office of the Trustee.

   The Company may also from time to time designate one or more other offices
or agencies where the Senior Collateralized Notes may be presented or
surrendered for any or all such purposes and may from time to time rescind
such designations. The Company will give prompt written notice to the Trustee
of any such designation or rescission and of any change in the location of any
such other office or agency.

   The Company hereby designates its office at The Wanamaker Building, 100 Penn
Square East, Philadelphia, Pennsylvania as one such office or agency of the
Company in accordance with Section 2.3.

Section 4.3 SEC Reports and Other Reports.

   (a) The Company shall file with the Trustee, within 15 days after filing
with the SEC, copies of the annual reports and of the information, documents,
and other reports (or copies of such portions of any of the foregoing as the
SEC may by rules and regulations prescribe) that the Company is required to
file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. If the
Company is not subject to the requirements of such Section 13 or 15(d) of the
Exchange Act, the Company shall continue to file with the SEC and the Trustee
on the same timely basis such reports, information and other documents as it
would file if it were subject to the requirements of Section 13 or 15(d) of
the Exchange Act. The Company shall also comply with the provisions of TIA
ss.314(a). Notwithstanding anything contrary herein the Trustee shall have no
duty to review such documents for purposes of determining compliance with any
provisions of the Indenture.

   (b) So long as any of the Senior Collateralized Notes remain outstanding,
the Company shall cause an annual report to stockholders and each quarterly or
other financial report furnished by it generally to stockholders to be filed
with the Trustee at the time of such mailing or furnishing to stockholders. If
the Company is not required to furnish annual or quarterly reports to its
stockholders pursuant to the Exchange Act, the Company shall cause its
financial statements, including any notes thereto (and, with respect to annual
reports, an auditors' report by the Company's certified independent
accountants) and a "Management's Discussion and Analysis of Financial
Condition or Plan of Operations," comparable to that which would have been
required to appear in annual or quarterly reports filed under Section 13 or
15(d) of the Exchange Act to be so filed with the Trustee within 120 days
after the end of each of the Company's Fiscal Years and within 60 days after
the end of each of the first three quarters of each Fiscal Year.

   (c) Whether or not required by the rules and regulations of the SEC, the
Company shall file a copy of all such information with the SEC for public
availability and make such information available to investors who request it
in writing.

   (d) The Company, or such other entity as the Company shall designate as
Registrar for the Senior Collateralized Notes as provided in Section 2.3
hereof, shall provide the Trustee with quarterly management reports which
provide the Trustee with such information regarding the Accounts maintained by
the Company for the benefit of the Holders of the Senior Collateralized Notes
as the Trustee may reasonably request which

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information shall include at least the following: (1) the outstanding balance
of each Account; (2) interest credited or withdrawals made for the period; (3)
the amount of interest paid in the form of additional notes at each month end
and (4) the interest rate paid on each Account maintained by the Company
during the preceding quarterly period.

Section 4.4 Compliance Certificate.

   (a) The Company shall deliver to the Trustee, within 120 days after the end
of each Fiscal Year, an Officers' Certificate stating that a review of the
activities of the Company during the preceding Fiscal Year has been made under
the supervision of the signing Officers with a view to determining whether
each has kept, observed, performed and fulfilled its obligations under this
Indenture, and further stating, as to each such Officer signing such
certificate, that to the best of such officer's knowledge the Company has
kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any
of the terms, provisions and conditions hereof (or, if a Default or Event of
Default shall have occurred, describing all such Defaults or Events of Default
of which he may have knowledge and what action each is taking or proposes to
take with respect thereto) and that to the best of such Officer's knowledge no
event has occurred and remains in existence by reason of which payments on
account of the principal of or interest, if any, on the Senior Collateralized
Notes are prohibited or if such event has occurred, a description of the event
and what action each is taking or proposes to take with respect thereto.

   (b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the annual financial
statements delivered pursuant to Section 4.3 above shall be accompanied by a
written statement of the Company's independent public accountants that in
making the examination necessary for certification of such financial
statements nothing has come to their attention which would lead them to
believe that the Company has violated the provisions of Section 4.1 of this
Indenture or, if any such violation has occurred, specifying the nature and
period of existence thereof, it being understood that such accountants shall
not be liable directly or indirectly to any Person for any failure to obtain
knowledge of any such violation.

   (c) The Company will, so long as any of the Senior Collateralized Notes are
outstanding, deliver to the Trustee, forthwith upon any Officer becoming aware
of any Default or Event of Default, an Officers' Certificate specifying such
Default or Event of Default and what action the Company is taking or proposes
to take with respect thereto.

Section 4.5 Stay, Extension and Usury Laws.

   The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it
may lawfully do so) hereby expressly waives all beneficial advantage of any
such law, and covenants that it will not, by resort to any such law, hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
has been enacted.

Section 4.6 Liquidation.

   The Board of Directors or the stockholders of the Company may not adopt a
plan of liquidation that provides for, contemplates or the effectuation of
which is preceded by (a) the sale, lease, conveyance or other disposition of
all or substantially all of the assets of the Company otherwise than
substantially as an entirety (Section 5.1 of this Indenture being the Section
hereof which governs any such sale, lease, conveyance or other disposition
substantially as an entirety) and (b) the distribution of all or substantially
all of the proceeds of such sale, lease, conveyance or other disposition and
of the remaining assets of the Company to the holders of capital stock of the
Company, unless the Company, prior to making any liquidating distribution
pursuant to such plan, makes provision for the satisfaction of the Company's
Obligations hereunder and under the Senior Collateralized Notes as to the
payment of principal and interest.


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Section 4.7 Limitation on Liens.

   So long as any of the Senior Collateralized Notes are outstanding, the
Company shall not, and shall not permit any of its Affiliates to, directly or
indirectly, create, incur, assume or suffer to exist any Liens on any
Collateral after the date of this Indenture or any income or profits therefrom
or assign or convey any right to receive income therefrom unless (i) such Lien
is a Permitted Lien or (ii) at the time of granting such Lien, the Collateral
Coverage Ratio is at least 1.5 to 1.

                                   ARTICLE V.
                                   SUCCESSORS

Section 5.1 When the Company May Merge, etc.

   The Company may not consolidate or merge with or into (whether or not the
Company is the surviving corporation), or sell, assign, transfer, lease,
convey or otherwise dispose of all or substantially all of its properties or
assets in one or more related transactions to another corporation, Person or
entity unless (a) the Company is the surviving corporation or the entity or
the Person formed by or surviving any such consolidation or merger (if other
than the Company) or to which such sale, assignment, transfer, lease,
conveyance or other disposition shall have been made is a corporation
organized or existing under the laws of the United States, any state thereof
or the District of Columbia; (b) the entity or Person formed by or surviving
any such consolidation or merger (if other than the Company) or the entity or
Person to which such sale, assignment, transfer, lease, conveyance or other
disposition will have been made assumes all the obligations of the Company
under the Senior Collateralized Notes and this Indenture pursuant to a
supplemental indenture in a form reasonably satisfactory to the Trustee; and
(c) immediately after such transaction no Default or Event of Default exists.

   The Company shall deliver to the Trustee prior to the consummation of the
proposed transaction an Officers' Certificate to the foregoing effect and an
Opinion of Counsel stating that the proposed transaction and such supplemental
indenture comply with this Indenture. The Trustee shall be entitled to
conclusively rely upon such Officers' Certificate and Opinion of Counsel.

Section 5.2 Successor Corporation Substituted.

   Upon any consolidation or merger, or any sale, lease, conveyance or other
disposition of all or substantially all of the assets of the Company in
accordance with Section 5.1, the successor corporation formed by such
consolidation or into or with which the Company, is merged or to which such
sale, lease, conveyance or other disposition is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor Person has been named
as the Company herein; provided, however, that the Company shall not be
released or discharged from the obligation to pay the principal of or interest
on the Senior Collateralized Notes.

                                  ARTICLE VI.
                             DEFAULTS AND REMEDIES

Section 6.1 Events of Default.

   An "Event of Default" occurs if:

      (1) the Company defaults in the payment of interest on a Senior
   Collateralized Note when the same becomes due and payable and the Default
   continues for a period of 30 days, whether or not such payment is prohibited
   by the provisions of Article X hereof;

      (2) the Company defaults in the payment of the principal of any Senior
   Collateralized Note when the same becomes due and payable at maturity, upon
   a required redemption or otherwise, and the Default continues for a period
   of 30 days, whether or not prohibited by the provisions of Article X hereof;

      (3) the Company fails to observe or perform any covenant, condition or
   agreement on the part of the Company to be observed or performed pursuant to
   Section 4.6 or 5.1 hereof;






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<PAGE>
      (4) the Company fails to comply with any of its other agreements or
   covenants in, or provisions of, the Senior Collateralized Notes or this
   Indenture and the Default continues for the period and after the notice
   specified below;

      (5) the Company pursuant to or within the meaning of any Bankruptcy Law
   (a) commences a voluntary case; (b) consents to the entry of an order for
   relief against it in an involuntary case; (c) consents to the appointment of
   a Custodian of it or for all or substantially all of its property; (d) makes
   a general assignment for the benefit of its creditors; or (e) admits in
   writing its inability to pay debts as the same become due;

      (6) a court of competent jurisdiction enters an order or decree under any
   Bankruptcy Law that (a) is for relief against the Company in an involuntary
   case; (b) appoints a Custodian of the Company or for all or substantially
   all of its property; (c) orders the liquidation of the Company, and the
   order or decree remains unstayed and in effect for 120 consecutive days; or

      (7) if any time the Collateral Coverage Ratio falls below 1.0 to 1.0, as
   determined by the Company.

   A Default under clause (3) or (4) of Section 6.1 is not an Event of Default
until the Trustee or the Holders of at least a majority in principal amount of
the then outstanding Senior Collateralized Notes notify the Company of the
Default and the Company does not cure the Default or such Default is not
waived within 60 days after receipt of the notice. The notice must specify the
Default, demand that it be remedied and state that the notice is a "Notice of
Default."

Section 6.2 Acceleration.

   If an Event of Default (other than an Event of Default specified in clauses
(5) or (6) of Section 6.1) occurs and is continuing, the Trustee by written
notice to the Company, or the Holders of at least a majority in principal
amount of the then outstanding Senior Collateralized Notes by written notice
to the Company and the Trustee, may declare the unpaid principal of and any
accrued interest on all the Senior Collateralized Notes to be due and payable.
Upon such declaration the principal and interest shall be due and payable
immediately; provided, however, that if any Indebtedness or Obligation is
outstanding pursuant to the Senior Debt, upon a declaration of acceleration by
the Holders, all principal and interest under this Indenture shall be due and
payable upon the earlier of (x) the day which is five Business Days after the
receipt by each of the Company and the holders of Senior Debt of such written
notice of acceleration or (y) the date of acceleration of any Indebtedness
under any Senior Debt. If an Event of Default specified in clause (5) or (6)
of Section 6.1 occurs, such an amount shall ipso facto become and be
immediately due and payable without any declaration or other act on the part
of the Trustee or any Holder. The Holders of a majority in principal amount of
the then outstanding Senior Collateralized Notes by written notice to the
Trustee may rescind an acceleration and its consequences if the rescission
would not conflict with any judgment or decree and if all existing Events of
Default (except nonpayment of principal or interest that has become due solely
because of the acceleration) have been cured or waived.

Section 6.3 Other Remedies.

   If an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of principal or interest on the Senior
Collateralized Notes or to enforce the performance of any provision of the
Senior Collateralized Notes or this Indenture.

   The Trustee may maintain a proceeding even if it does not possess any of the
Senior Collateralized Notes or does not produce any of them in the proceeding.
A delay or omission by the Trustee or any Securityholder in exercising any
right or remedy accruing upon an Event of Default shall not impair the right
or remedy or constitute a waiver of or acquiescence in the Event of Default.
All remedies are cumulative to the extent permitted by law.

Section 6.4 Waiver of Past Defaults.

   Holders of a majority in principal amount of the then outstanding Senior
Collateralized Notes by notice to the Trustee may waive an existing Default or
Event of Default and its consequences except a continuing

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<PAGE>
Default or Event of Default in the payment of the principal of or interest on
any Senior Collateralized Note held by a non-consenting Holder. Upon actual
receipt of any such notice of waiver by a Responsible Officer of the Trustee,
such Default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been cured for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other Default or Event of
Default or impair any right consequent thereon.

Section 6.5 Control by Majority.

   The Holders of a majority in principal amount of the then outstanding Senior
Collateralized Notes may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on it, provided, that indemnification for the Trustee's fees
and expenses, in a form reasonably satisfactory to the Trustee, shall have
been provided. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture, that the Trustee determines may be
unduly prejudicial to the rights of other Securityholders, or that may involve
the Trustee in personal liability.

Section 6.6 Limitation on Suits.

   A Holder may pursue a remedy with respect to this Indenture or the Senior
Collateralized Notes only if:

      (1) the Holder gives to the Trustee written notice of a continuing Event
   of Default;

      (2) the Holders of at least a majority in principal amount of the then
   outstanding Senior Collateralized Notes make a written request to the
   Trustee to pursue the remedy;

      (3) such Holder or Holders offer and, if requested, provide to the
   Trustee indemnity satisfactory to the Trustee against any loss, liability or
   expense;

      (4) the Trustee does not comply with the request within 60 days after
   receipt of the request and the offer and, if requested, the provision of
   indemnity; and

      (5) during such 60 day period the Holders of a majority in principal
   amount of the then outstanding Senior Collateralized Notes do not give the
   Trustee a direction inconsistent with the request.

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

Section 6.7 Rights of Holders to Receive Payment.

   Notwithstanding any other provision of this Indenture, but subject to
Article X hereof, the right of any Holder of a Senior Collateralized Note to
receive payment of principal and interest on the Senior Collateralized Note,
on or after the respective due dates expressed in the Senior Collateralized
Note, or to bring suit for the enforcement of any such payment on or after
such respective dates, shall not be impaired or affected without the consent
of the Holder.

Section 6.8 Collection Suit by Trustee.

   If an Event of Default specified in Section 6.1 (1) or (2) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name and
as trustee of an express trust against the Company for the whole amount of
principal and interest remaining unpaid on the Senior Collateralized Notes and
interest on overdue principal and, to the extent lawful, interest and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.

Section 6.9 Trustee May File Proofs of Claim.

   The Trustee is authorized to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders

                                      A-16

<PAGE>
allowed in any judicial proceedings relative to the Company (or any other
obligor upon the Senior Collateralized Notes), its creditors or its property
and shall be entitled and empowered to collect, receive and distribute any
money or other property payable or deliverable on any such claims and any
custodian 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 amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 7.7 hereof. To the extent that the
payment of any such compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.7 hereof out of the estate in any such proceeding, shall be denied
for any reason, payment of the same shall be secured by a lien on, and shall
be paid out of, any and all distributions, dividends, money, securities and
other properties which the Holders of the Senior Collateralized Notes may be
entitled to receive in such proceeding whether in liquidation or under any
plan of reorganization or arrangement or otherwise. 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 Senior Collateralized Notes 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.

   If the Trustee does not file a proper claim or proof of debt in the form
required in any such proceeding prior to 30 days before the expiration of the
time to file such claims or proofs, then any holder of Senior Debt shall have
the right to demand, sue for, collect and receive the payments and
distributions in respect of the Senior Collateralized Notes which are required
to be paid or delivered to the holders of Senior Debt as provided in Article X
hereof and to file and prove all claims therefore and to take all such other
action in the name of the Holders or otherwise, as such holder of Senior Debt
may determine to be necessary or appropriate for the enforcement of the
provisions of Article X.

Section 6.10 Priorities.

   Following an Event of Default and notwithstanding any acceleration, if the
Trustee collects any money pursuant to this Article, it shall, subject to the
provisions of Article X hereof, pay out the money in the following order:

   First: to the Trustee, its agents and attorneys for amounts due under
Section 7.7, including payment of all compensation, expenses and liabilities
incurred, and all advances made, if any, by the Trustee and the costs and
expenses of collection;

   Second: to holders of Senior Debt to the extent required by Article X
hereof;

   Third: to Holders for amounts due and unpaid on the Senior Collateralized
Notes for principal and interest, ratably, without preference or priority of
any kind, according to the amounts due and payable on the Senior
Collateralized Notes for principal and interest, respectively; and

   Fourth: to the Company or to such party as a court of competent jurisdiction
shall direct.

   The Trustee may fix a record date and payment date for any payment to
Holders.

Section 6.11 Undertaking for Costs.

   In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as a
Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 6.7, or a suit by Holders of more than 10% in
principal amount of the then outstanding Senior Collateralized Notes.






                                      A-17

<PAGE>
                                  ARTICLE VII.
                                    TRUSTEE

Section 7.1 Duties of Trustee.

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

   (b) Except during the continuance of an Event of Default:

      (1) The duties of the Trustee shall be determined solely by the express
   provisions of this Indenture and the Trustee need perform only those duties
   that are specifically set forth in this Indenture and no others, and no
   implied covenants or obligations shall be read into this Indenture against
   the Trustee.

      (2) In the absence of bad faith on its part, the Trustee may conclusively
   rely, as to the truth of the statements and the correctness of the opinions
   expressed therein, upon resolutions, statements, reports, documents, orders,
   certificates, opinions or other instruments furnished to the Trustee and
   conforming to the requirements of this Indenture. However, in the case of
   any of the above that are specifically required to be furnished to the
   Trustee pursuant to this Indenture, the Trustee shall examine them to
   determine whether they substantially conform to the requirements of this
   Indenture.

   (c) The Trustee may not be relieved from liabilities for its own negligent
action, its own negligent failure to act, or its own willful misconduct,
except that:

      (1) This paragraph does not limit the effect of paragraph (2) of this
   Section.

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

      (3) The Trustee shall not be liable with respect to any action it takes
   or omits to take in good faith in accordance with a direction received by it
   pursuant to Section 6.5.

   (d) Whether or not therein expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b) and (c) of this Section.

   (e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee may refuse to perform
any duty or exercise any right or power unless it receives indemnity
satisfactory to it against any loss, liability or expense.

   (f) The Trustee shall not be liable for interest on any money received by it
except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.

Section 7.2 Rights of Trustee.

   (a) The Trustee may conclusively rely upon any document believed by it to be
genuine and to have been signed or presented to it by the proper Person. The
Trustee need not investigate any fact or matter stated in the document. The
Trustee shall have no duty to inquire as to the performance of the Company's
covenants in Article IV. In addition, the Trustee shall not be deemed to have
knowledge of any Default or any Event of Default except any Default or Event
of Default of which the Trustee shall have received written notification or
obtained actual knowledge.

   (b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance
on such Officers' Certificate or Opinion of Counsel. 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 from liability in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon.


                                      A-18

<PAGE>
   (c) The Trustee may act through agents, attorneys, custodians or nominees
and shall not be responsible for the misconduct or negligence or the
supervision of any agents, attorneys, custodians or nominees appointed by it
with due care.

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

   (e) Unless otherwise specifically provided in this Indenture, any demand,
request, direction or notice from the Company shall be sufficient if signed by
an Officer of the Company.

   (f) The Trustee shall not be deemed to have notice of an Event of Default
for any purpose under this Indenture unless notified of such Event of Default
by the Company, the Paying Agent (if other than the Company) or a Holder of
the Senior Collateralized Notes.

Section 7.3 Individual Rights of Trustee.

   The Trustee in its individual or any other capacity may become the owner or
pledgee of Senior Collateralized Notes and may otherwise deal with the Company
or an Affiliate of the Company with the same rights it would have if it were
not Trustee. Any Agent may do the same with like rights. However, the Trustee
is subject to Sections 7.10 and 7.11.

Section 7.4 Trustee's Disclaimer.

   The Trustee shall not be (i) responsible for and makes no representation as
to, the validity or adequacy of this Indenture or the Senior Collateralized
Notes, (ii) accountable for the Company's use of the proceeds from the Senior
Collateralized Notes or any money paid to the Company or upon the Company's
direction under any provision hereof, (iii) responsible for the use or
application of any money received by any Paying Agent other than the Trustee;
and (iv) responsible for any statement or recital herein or any statement in
the Senior Collateralized Notes or any other document in connection with the
sale of the Senior Collateralized Notes or pursuant to this Indenture other
than its certificate of authentication.

Section 7.5 Notice of Defaults.

   If a Default or Event of Default occurs and is continuing and if it is known
to a Responsible Officer of the Trustee, the Trustee shall, after any
applicable cure period, mail to Holders a notice of the Default or Event of
Default within 90 days after it occurs. At least five Business Days prior to
the mailing of any notice to Holders under this Section 7.5, the Trustee shall
provide the Company with notice of its intent to mail such notice. Except in
the case of a Default or Event of Default in payment on any Senior
Collateralized Note, the Trustee may withhold the notice if and so long as the
Responsible Officer of the Trustee in good faith determines that withholding
the notice would have no material adverse effect on the Holders.

Section 7.6 Reports by Trustee to Holders.

   Within 60 days after May 15th of each fiscal year, commencing May 15, 2004,
the Trustee shall mail to Holders a brief report dated as of such reporting
date that complies with TIA ss. 313(a) (but if no event described in TIA ss.
313(a) has occurred within the 12 months preceding the reporting date, no
report need be prepared or transmitted). The Trustee also shall comply with
TIA ss. 313(b). The Trustee shall also transmit by mail all reports as
required by TIA ss. 313(c).

   Commencing at the time this Indenture is qualified under the TIA, a copy of
each report mailed to Holders under this Section 7.6 (at the time of its
mailing to Holders) shall be filed with the SEC and each stock exchange, if
any, on which the Senior Collateralized Notes are listed. The Company shall
promptly notify the Trustee when the Senior Collateralized Notes are listed on
any stock exchange.

Section 7.7 Compensation and Indemnity.

   The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and its performance of the
duties and services required hereunder. The Trustee's compensation

                                      A-19

<PAGE>
shall not be limited by any law on compensation of a trustee of an express
trust. The Company shall reimburse the Trustee promptly upon request for all
reasonable disbursements, advances and expenses incurred or made by it in
addition to the compensation for its services. Such expenses shall include the
reasonable compensation, disbursements and expenses of the Trustee's agents
and counsel.

   The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with
the acceptance or administration of its duties under this Indenture, except as
set forth in the second next paragraph. The Trustee shall notify the Company
promptly of any claim for which it may seek indemnity. Failure by the Trustee
to so notify the Company shall not relieve the Company of its obligations
hereunder, except to the extent the Company is prejudiced thereby. The Company
shall defend the claim and the Trustee shall reasonably cooperate in such
defense. The Trustee may have separate counsel and the Company shall pay the
reasonable fees and expenses of such one counsel. The Company need not pay for
any settlement made without its consent, which consent shall not be
unreasonably withheld.

   The obligations of the Company under this Section 7.7 shall survive the
satisfaction and discharge of this Indenture.

   The Company need not reimburse any expense or indemnify against any loss or
liability incurred by the Trustee through its own negligence or bad faith.

   To secure the Company's payment obligations in this Section, the Trustee
shall have a lien prior to the Senior Collateralized Notes on all money or
property held or collected by the Trustee, except that held in trust to pay
principal and interest on the Senior Collateralized Notes. Such lien shall
survive the satisfaction and discharge of this Indenture.

   When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.1(5) or (6) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.

Section 7.8 Replacement of Trustee.

   A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.8.

   The Trustee may resign at any time and be discharged from the trust hereby
created by so notifying the Company. The Holders of a majority in principal
amount of the then outstanding Senior Collateralized Notes may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company
may remove the Trustee if.

      (1) the Trustee fails to comply with Section 7.10;

      (2) the Trustee is adjudged a bankrupt or an insolvent or an order for
   relief is entered with respect to the Trustee under any Bankruptcy Law;

      (3) a Custodian or public officer takes charge of the Trustee or its
   property;

      (4) the Trustee becomes incapable of acting as Trustee under this
   Indenture, or

      (5) the Company so elects, provided such replacement Trustee is qualified
   and reasonably acceptable.

   If the Trustee resigns or is removed or if a vacancy exists in the office of
Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Senior
Collateralized Notes may appoint a different successor Trustee to replace the
successor Trustee appointed by the Company.

   If a successor Trustee does not take office within 30 days after notice that
the Trustee has resigned or has been removed, the Company or the Trustee or
the Holders of at least a majority in principal amount of the then outstanding
Senior Collateralized Notes may petition any court of competent jurisdiction
for the appointment of a successor Trustee.




                                      A-20

<PAGE>
   If the Trustee after written request by any Holder who has been a Holder for
at least 6 months fails to comply with Section 7.10, such Holder may petition
any court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.

   A successor Trustee shall deliver a written acceptance of its appointment to
the retiring Trustee and to the Company. Thereupon the resignation or removal
of the retiring Trustee shall become effective, and the successor Trustee
shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to all
Holders. The retiring Trustee shall promptly transfer all property held by it
as Trustee to the successor Trustee, provided all sums owing to the Trustee
hereunder have been paid and subject to the lien provided for in Section 7.7.
Notwithstanding replacement of the Trustee pursuant to this Section 7.8, the
Company's obligations under Section 7.7 hereof shall continue for the benefit
of the retiring Trustee.

Section 7.9 Successor Trustee by Merger, etc.

   If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor Trustee.

Section 7.10 Eligibility; Disqualification.

   There shall at all times be a Trustee hereunder which shall be a corporation
organized and doing business under the laws of the United States of America or
of any state or territory thereof or of the District of Columbia authorized
under such laws to exercise corporate trustee power, shall be subject to
supervision or examination by Federal, state, territorial or District of
Columbia authority and shall have a combined capital and surplus of at least
$500,000 as set forth in its most recent published annual report of condition.

   This Indenture shall always have a Trustee who satisfies the requirements of
TIA ss. 310(a)(1) and (2). The Trustee is subject to TIA ss. 310(b).

Section 7.11 Preferential Collection of Claims Against Company.

   The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.

                                 ARTICLE VIII.
                             DISCHARGE OF INDENTURE

Section 8.1 Termination of Company's Obligations.

   This Indenture shall cease to be of further effect (except that the
Company's obligations under Section 7.7 and 8.4, and the Company's, Trustee's
and Paying Agent's obligations under Section 8.3 shall survive) when all
outstanding Senior Collateralized Notes have been paid in full, and the
Company has paid all sums payable by the Company hereunder. In addition, the
Company may terminate all of its Obligations under this Indenture if:

      (1) the Company irrevocably deposits in trust with the Trustee or at the
   option of the Trustee, with a trustee reasonably satisfactory to the Trustee
   and the Company under the terms of an irrevocable trust agreement in form
   and substance satisfactory to the Trustee, money or U.S. Government
   Obligations sufficient (as certified by an independent public accountant
   designated by the Company) to pay principal and interest on the Senior
   Collateralized Notes to maturity or redemption, as the case may be, and to
   pay all other sums payable by it hereunder, provided that (i) the trustee of
   the irrevocable trust shall have been irrevocably instructed to pay such
   money or the proceeds of such U.S. Government Obligations to the Trustee and
   (ii) the Trustee shall have been irrevocably instructed to apply such money
   or the proceeds of such U.S. Government Obligations to the payment of said
   principal and interest with respect to the Senior Collateralized Notes;




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<PAGE>
      (2) the Company delivers to the Trustee an Officers' Certificate stating
   that all conditions precedent to satisfaction and discharge of this
   Indenture have been complied with; and

      (3) no Default or Event of Default shall have occurred and be continuing
   on the date of such deposit.

Then, this Indenture shall cease to be of further effect (except as provided
in this paragraph), and the Trustee, on demand of the Company, shall execute
proper instruments acknowledging confirmation of and discharge under this
Indenture. The Company may make the deposit only if Article X hereof does not
prohibit such payment. However, the Company's obligations in Sections 2.3,
2.4, 2.5, 2.6, 2.7, 2.8, 4.1, 4.2, 4.3, 7.7, 7.8, 8.3 and 8.4 and the
Trustee's and Paying Agent's obligations in Section 8.3 shall survive until
the Senior Collateralized Notes are no longer outstanding.

   After such irrevocable deposit made pursuant to this Section 8.1 and
satisfaction of the other conditions set forth herein, the Trustee upon
written request shall acknowledge in writing the discharge of the Company's
Obligations under this Indenture except for those surviving obligations
specified above.

   In order to have money available on a payment date to pay principal or
interest on the Senior Collateralized Notes, the U.S. Government Obligations
shall be payable as to principal or interest at least one Business Day before
such payment date in such amounts as will provide the necessary money. U.S.
Government Obligations shall not be callable at the issuer's option.

Section 8.2 Application of Trust Money.

   The Trustee or a trustee satisfactory to the Trustee and the Company shall
hold in trust money or U.S. Government Obligations deposited with it pursuant
to Section 8.1. It shall apply the deposited money and the money from U.S.
Government Obligations through the Paying Agent and in accordance with this
Indenture to the payment of principal and interest on the Senior
Collateralized Notes.

Section 8.3 Repayment to Company.

   The Trustee and the Paying Agent shall promptly pay to the Company upon
written request any excess money or Senior Collateralized Notes held by them
at any time.

   The Trustee and the Paying Agent shall pay to the Company upon written
request any money held by them for the payment of principal or interest that
remains unclaimed for two years after the date upon which such payment shall
have become due; provided, however, that the Company shall have either caused
notice of such payment to be mailed to each Holder entitled thereto no less
than 30 days prior to such repayment or within such period shall have
published such notice in a newspaper of widespread circulation published in
the city of Philadelphia, Pennsylvania. After payment to the Company, Holders
entitled to the money must look to the Company for payment as general
creditors unless an applicable abandoned property law designates another
Person, and all liability of the Trustee and such Paying Agent with respect to
such money shall cease.

Section 8.4 Reinstatement.

   If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with Section 8.2 by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application,
the Company's Obligations under this Indenture and the Senior Collateralized
Notes shall be revived and reinstated as though no deposit had occurred
pursuant to Section 8.1 until such time as the Trustee or Paying Agent is
permitted to apply all such money or U.S. Government Obligations in accordance
with Section 8.2; provided, however, that if the Company has made any payment
of interest on or principal of any Senior Collateralized Notes because of the
reinstatement of its Obligations, the Company shall be subrogated to the
rights of the Holders of such Senior Collateralized Notes to receive such
payment, as long as no money is owed to the Trustee by the Company, from the
money or U.S. Government Obligations held by the Trustee or Paying Agent.


                                      A-22

<PAGE>
                                  ARTICLE IX.
                                   AMENDMENTS

Section 9.1 Without Consent of Holders.

   The Company and the Trustee may amend this Indenture or the Senior
Collateralized Notes without the consent of any Holder:

      (1) to cure any ambiguity, defect or inconsistency;

      (2) to comply with Section 5.1;

      (3) to provide for additional uncertificated Senior Collateralized Notes
   or certificated Senior Collateralized Notes;

      (4) to make any change that does not adversely affect the legal rights
   hereunder of any Holder, including but not limited to, an increase in the
   aggregate dollar amount of Senior Collateralized Notes which may be
   outstanding under this Indenture;

      (5) make any change in Section 3.2; provided, however, that no such
   change shall adversely affect the rights of any outstanding Senior
   Collateralized Note; or

      (6) to comply with any requirements of the SEC in connection with the
   qualification of this Indenture under the TIA.

Section 9.2 With Consent of Holders.

   The Company and the Trustee may amend this Indenture or the Senior
Collateralized Notes with the written consent of the Holders of at least a
majority in principal amount of the then outstanding Senior Collateralized
Notes. The Holders of a majority in principal of the then outstanding Senior
Collateralized Notes may also waive any existing default or compliance with
any provision of this Indenture or the Senior Collateralized Notes. However,
without the consent of the Holder of each Senior Collateralized Note affected,
an amendment or waiver under this Section may not (with respect to any Senior
Collateralized Note held by a nonconsenting Holder):

      (1) reduce the principal amount of Senior Collateralized Notes whose
   Holders must consent to an amendment, supplement or waiver;

      (2) reduce the rate of or change the time for payment of interest,
   including default interest, on any Senior Collateralized Note;

      (3) reduce the principal of or change the fixed maturity of any Senior
   Collateralized Note or alter the redemption provisions or the price at which
   the Company shall offer to purchase such Senior Collateralized Note pursuant
   to Section 3.1 of Article III hereof;

      (4) make any Senior Collateralized Note payable in money other than that
   stated in the Prospectus (or related supplement) with respect to such Senior
   Collateralized Note;

      (5) modify or eliminate the right of the estate of a Holder or a Holder
   to cause the Company to redeem a Senior Collateralized Note upon the death
   of a Holder pursuant to Article III; provided, however, that the Company may
   not modify or eliminate such right, as it may be in effect on the Issue
   Date, of any Senior Collateralized Note which was issued with such right.
   After an amendment under this subsection 9.1(5) becomes effective, the
   Company shall mail to the Holders of each Senior Collateralized Note then
   outstanding a notice briefly describing the amendment.

      (6) make any change in Section 6.4 or 6.7 hereof or in this sentence of
   this Section 9.2;

      (7) make any change in Article X that adversely affects the rights of any
   Holders; or

      (8) waive a Default or Event of Default in the payment of principal of,
   or premium, if any, or interest on, or redemption payment with respect to,
   any Senior Collateralized Note (except a rescission of acceleration of the
   Senior Collateralized Notes by the Holders of at least a majority in
   aggregate





                                      A-23

   <PAGE>
   principal amount of the Senior Collateralized Notes and a waiver of the
   payment default that resulted from such acceleration).

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

   After an amendment or waiver under this Section becomes effective, the
Company shall mail to the Holders of each Senior Collateralized Note affected
thereby a notice briefly describing the amendment or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental indenture or
waiver. Subject to Sections 6.4 and 6.7 hereof, the Holders of a majority in
principal amount of the Senior Collateralized Notes then outstanding may waive
compliance in a particular instance by the Company with any provision of this
Indenture or the Senior Collateralized Notes.

Section 9.3 Compliance with Trust Indenture Act.

   If at the time this Indenture shall be qualified under the TIA, every
amendment to this Indenture or the Senior Collateralized Notes shall be set
forth in a supplemental indenture that complies with the TIA as then in
effect.

Section 9.4 Revocation and Effect of Consents.

   Until an amendment or waiver becomes effective, a consent to it by a Holder
of a Senior Collateralized Note is a continuing consent by the Holder and
every subsequent Holder of a Senior Collateralized Note or portion of a Senior
Collateralized Note that evidences the same debt as the consenting Holder's
Senior Collateralized Note, even if notation of the consent is not made on any
Senior Collateralized Note. An amendment or waiver becomes effective in
accordance with its terms and thereafter binds every Holder.

   The Company may fix a record date for determining which Holders must consent
to such amendment or waivers. If the Company fixes a record date, the record
date shall be fixed at (i) the later of 30 days prior to the first
solicitation of such consent or the date of the most recent list of Holders
furnished to the Trustee prior to such solicitation pursuant to Section 2.5,
or (ii) such other date as the Company shall designate.

Section 9.5 Notation on or Exchange of Senior Collateralized Notes.

   The Trustee may place an appropriate notation about an amendment or waiver
on any Senior Collateralized Note, if certificated, or any Account statement.
Failure to make the any notation or issue a new note shall not affect the
validity and effect of such amendment or waiver.

Section 9.6 Trustee to Sign Amendments, etc.

   The Trustee shall sign any amendment or supplemental indenture authorized
pursuant to this Article IX if, in the Trustee's reasonable discretion, the
amendment does not adversely affect the rights, duties, liabilities or
immunities of the Trustee. If it does, the Trustee may, but need not, sign it.
In signing or refusing to sign such amendment or supplemental indenture, the
Trustee shall be entitled to receive, if requested, an indemnity reasonably
satisfactory to it and to receive and, subject to Section 7.1, shall be fully
protected in relying upon, an Officers' Certificate and an Opinion of Counsel
(or written advice of counsel) as conclusive evidence that such amendment or
supplemental indenture is authorized or permitted by this Indenture, that it
is not inconsistent herewith, and that it will be valid and binding upon the
Company in accordance with its terms. The Company may not sign an amendment or
supplemental indenture until its Board of Directors approves it.


                                      A-24

<PAGE>
                                   ARTICLE X.
                                 SUBORDINATION

Section 10.1 Agreement to Subordinate.

   The Company agrees, and each Holder by accepting a Senior Collateralized
Note consents and agrees, that the Indebtedness evidenced by the Senior
Collateralized Notes and the payment of the principal of and interest on the
Senior Collateralized Notes is subordinated in right of payment, to the extent
and in the manner provided in this Article, to the prior payment in full, in
cash, cash equivalents or otherwise in a manner satisfactory to the holders of
Senior Debt, of all Obligations due in respect of Senior Debt of the Company
whether outstanding on the date hereof or hereafter incurred or arising and
that the subordination is for the benefit of the holders of Senior Debt.
Furthermore, each such Holder by accepting a Senior Collateralized Note hereby
agrees and confirms that the Company and its Affiliates may grant Liens to
secure any Senior Debt, which shall be Priority Liens and that the Liens in
favor of Holders shall automatically be subordinated to Priority Liens. Each
Holder hereby consents to the Trustee (on behalf of the Holders) entering into
any lien subordination agreement or similar agreement as may be required by a
holder of the Senior Debt and/or authorizing any such holder of the Senior
Debt to file any and all records such holder deems necessary to evidence the
subordination provided for in this Section 10.1.

   For purposes of this Article X, a payment or distribution on account of the
Senior Collateralized Notes may consist of cash, property or securities, by
set-off or otherwise, and a payment or distribution on account of any of the
Senior Collateralized Notes shall include, without limitation, any redemption,
purchase or other acquisition of the Senior Collateralized Notes.

Section 10.2 Liquidation; Dissolution; Bankruptcy.

   (a) Upon any payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, to creditors upon (i) any
dissolution or winding-up or total or partial liquidation or reorganization of
the Company whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy or (ii) any bankruptcy or insolvency case or
proceeding or any receivership, liquidation, reorganization or other similar
case or proceeding in connection therewith, relative to the Company or to its
assets, (iii) any assignment for the benefit of creditors or any other
marshaling of assets of the Company, all obligations due, or to become due, in
respect of Senior Debt (including interest after the commencement of any such
proceeding at the rate specified in the applicable Senior Debt) shall first
interfeasibly be paid in full, or provision shall have been made for such
payment, in cash, cash equivalents or otherwise in a manner satisfactory to
the holders of Senior Debt, before any payment is made on account of the
principal of, premium, if any, or interest on the Senior Collateralized Notes,
except that Holders may receive securities that are subordinated to at least
the same extent as the Senior Collateralized Notes are to (x) Senior Debt and
(y) any securities issued in exchange for Senior Debt. Upon any such
dissolution winding-up, liquidation or reorganization, any payment or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, to which the Holders of the Senior
Collateralized Notes or the Trustee under this Indenture would be entitled,
except for the provisions hereof, shall be paid by the Company or by any
receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution, or by the Holders of the Senior
Collateralized Notes or by the Trustee under this Indenture if received by
them, directly to the Holders of Senior Debt (pro rata to such holders on the
basis of the amounts of Senior Debt held by such holders) or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any of such Senior Debt may have been issued, as
their interests may appear, for application to the payment of Senior Debt
remaining unpaid until all such Senior Debt has been indefeasibly paid in
full, or provisions shall have been made for such payment, in cash, cash
equivalents or otherwise in a manner satisfactory to the holders of Senior
Debt, after giving effect to any concurrent payment, distribution or provision
therefore to or for the holders of Senior Debt.

   (b) For purposes of this Article X, the words "cash, property or securities"
shall not be deemed to include securities of the Company or any other
corporation provided for by a plan of reorganization or readjustment which are
subordinated, to at least the same extent as the Senior Collateralized Notes,
to the payment of all Senior Debt then outstanding or to the payment of all
securities issued in exchange therefore

                                      A-25

<PAGE>
to the holders of Senior Debt at the time outstanding. The consolidation of
the Company with, or the merger of the Company with or into, another
corporation or the liquidation or dissolution of the Company following the
conveyance or transfer of its property as an entirety, or substantially as an
entirety, to another corporation upon the terms and conditions provided in
Article V shall not be deemed a dissolution, winding-up, liquidation or
reorganization for the purposes of this Section if such other corporation
shall, as part of such consolidation, merger, conveyance or transfer, comply
with the conditions stated in Article V.

Section 10.3 Default of Senior Debt.

   (a) In the event and during the continuation of any default in the payment
of principal of (or premium, if any) or interest on any Senior Debt, or any
amount owing from time to time under or in respect of Senior Debt or in the
event that any nonpayment event of default with respect to any Senior Debt
shall have occurred and be continuing and shall have resulted in such Senior
Debt becoming or being declared due and payable prior to the date on which it
would otherwise have become due and payable, or (b) in the event that any
other nonpayment event of default with respect to any Senior Debt shall have
occurred and be continuing permitting the holders of such Senior Debt (or a
trustee on behalf of the holders thereof) to declare such Senior Debt due and
payable prior to the date on which it would otherwise have become due and
payable, then the Company shall make no payment, direct or indirect (including
any payment which may be payable by reason of the payment of any other
Indebtedness of the Company being subordinated to the payment of the Senior
Collateralized Notes (other than securities that are subordinated to at least
the same extent as the Senior Collateralized Notes are to (x) Senior Debt and
(y) any securities issued in exchange for Senior Debt)) unless and until (i)
such event of default shall have been cured or waived or shall have ceased to
exist or such acceleration shall have been rescinded or annulled, or (ii) in
case of any nonpayment event of default specified in (b), during the period (a
"Payment Blockage Period") commencing on the date the Company and the Trustee
receive written notice (a "Payment Notice") of such event of default (which
notice shall be binding on the Trustee and the Holders as to the occurrence of
such an event of default) from a holder of the Senior Debt to which such
default relates and ending on the earliest of (A) 179 days after such date,
(B) the date, if any, on which such Senior Debt to which such default relates
is discharged or such default is waived by the holders of such Senior Debt or
otherwise cured and (C) the date on which the Trustee receives written notice
from the holder of such Senior Debt to which such default relates terminating
the Payment Blockage Period. No new Payment Blockage Period may be commenced
within 360 days after the receipt by the Trustee of any prior Payment Blockage
Notice. For all purposes of this Section 10.3, no Event of Default which
existed or was commencing with respect to the Senior Debt to which a Payment
Blockage Period relates on the date such Payment Blockage Period commenced
shall be or be made the basis for the commencement or any subsequent Payment
Blockage Period unless such event of default is cured or waived for a period
of not less than 180 consecutive days.

Section 10.4 When Distribution Must Be Paid Over.

   If the Trustee or any Holder receives any payment with respect to the Senior
Collateralized Notes, whether in cash property or securities (other than
securities that are subordinated to at least the same extent of the Senior
Collateralized Notes are to (x) Senior Debt and (y) any securities issued in
exchange for Senior Debt at a time when such payment is prohibited by Article
X hereof), such payment shall be held by the Trustee or such Holder, in trust
for the benefit of, and shall be paid forthwith over and delivered to, the
holders of Senior Debt (pro rata to such holders on the basis of the amount of
Senior Debt held by such holders) for application to the payment of all
Obligations with respect to Senior Debt remaining unpaid to the extent
necessary to pay such Obligations in full, in cash, cash equivalents or
otherwise in a manner satisfactory to the holders of Senior Debt, in
accordance with the terms of such Senior Debt, after giving effect to any
concurrent payment or distribution to or for the holders of Senior Debt.

   With respect to the holders of Senior Debt, the Trustee undertakes to
perform only such obligations on the part of the Trustee as are specifically
set forth in this Article X, and no implied covenants or obligations with
respect to the holders of Senior Debt shall be read into this Indenture
against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty
to the holders of Senior Debt, and shall not be liable to any such holders if
the Trustee shall pay over or distribute to or on behalf of Holders or the
Company or any

                                      A-26

<PAGE>
other Person money or assets to which any holders of Senior Debt shall be
entitled by virtue of this Article X, except if such payment is made as a
result of the willful misconduct or gross negligence of the Trustee.

Section 10.5 Notice by Company.

   The Company shall promptly notify the Trustee and the Paying Agent in
writing of any facts known to the Company that would cause a payment of any
Obligations with respect to the Company to violate this Article, but failure
to give such notice shall not affect the subordination of the Senior
Collateralized Notes to the Senior Debt provided in this Article.

Section 10.6 Subrogation.

   After all Senior Debt is paid in full, in cash, cash equivalents or
otherwise in a manner satisfactory to the holders of such Senior Debt, and
until the Senior Collateralized Notes are paid in full, Holders shall be
subrogated (equally and ratably with all other Indebtedness pari passu with
the Senior Collateralized Notes) to the rights of holders of Senior Debt to
receive distributions applicable to Senior Debt to the extent that
distributions otherwise payable to the Holders have been applied to the
payment of Senior Debt. A distribution made under this Article to holders of
Senior Debt which otherwise would have been made to Holders is not, as between
the Company and Holders, a payment by the Company on the Senior Debt.

Section 10.7 Relative Rights.

   This Article defines the relative rights of Holders and holders of Senior
Debt. Nothing in this Indenture shall:

      (1) impair, as between the Company and Holders, the obligations of the
   Company, which are absolute and unconditional, to pay principal of and
   interest on the Senior Collateralized Notes in accordance with their terms;

      (2) affect the relative rights of Holders and creditors of the Company
   other than their rights in relation to holders of Senior Debt; or

      (3) prevent the Trustee or any Holder from exercising its available
   remedies upon a Default or Event of Default, subject to the rights of
   holders and owners of Senior Debt to receive distributions and payments
   otherwise payable to Holders.

   If the Company fails because of this Article to pay principal of or interest
on a Senior Collateralized Note on the due date, the failure is still a
Default or Event of Default.

Section 10.8 Subordination May Not Be Impaired by the Company or Holders of
Senior Debt.

   No right of any present or future holder of Senior Debt to enforce the
subordination of the Indebtedness evidenced by the Senior Collateralized Notes
and the Obligations related thereto shall be prejudiced or impaired by any act
or failure to act by any such holder or by the Company, the Trustee or any
Agent or by the failure of the Company to comply with this Indenture,
regardless of any knowledge thereof which any such holder may have or
otherwise be charged with.

   Without limiting the effect of the preceding paragraph, any holder of Senior
Debt may at any time and from time to time without the consent of or notice to
any other holder or to the Trustee, without impairing or releasing any of the
rights of any holder of Senior Debt under this Indenture, upon or without any
terms or conditions and in whole or in part:

   (a) change the manner, place or term of payment, or change or extend the
time of payment of, renew or alter any Senior Debt or any other liability of
the Company to such holder, any security therefore, or any liability incurred
directly or indirectly in respect thereof, and the provisions of this Article
X shall apply to the Senior Collateralized Notes as so changed, extended,
renewed or altered;

   (b) notwithstanding the provisions of Section 5.1 hereof, sell, exchange,
release, surrender, realize upon or otherwise deal with in any manner and in
any order any property by whomsoever at any time pledged or

                                      A-27

<PAGE>
mortgaged to secure, or howsoever securing, any Senior Debt or any other
liability of the Company to such holder or any other liabilities incurred
directly or indirectly in respect thereof or hereof or any offset there
against;

   (c) exercise or refrain from exercising any rights or remedies against the
Company or others or otherwise act or refrain from acting or, for any reason,
fail to file, record or otherwise perfect any security interest in or lien on
any property of the Company or any other Person; and

   (d) settle or compromise any Senior Debt or any other liability of the
Company to such holder, or any security therefore, or any liability incurred
directly or indirectly in respect thereof.

   All rights and interests under this Indenture of any holder of Senior Debt
and all agreements and obligations of the Trustee, the Holders, and the
Company under Article VI and under this Article X shall remain in full force
and effect irrespective of (i) any lack of validity or enforceability of any
agreement or instrument relating to any Senior Debt or (ii) any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, the Trustee, any Holder, or the Company.

   Any holder of Senior Debt hereby authorized to demand specific performance
of the provisions of this Article X, whether or not the Company shall have
complied with any of the provisions of this Article X applicable to it, at any
time when the Trustee or any Holder shall have failed to comply with any of
these provisions. The Trustee and the Holders irrevocably waive any defense
based on the adequacy of a remedy at law that might be asserted as a bar to
such remedy of specific performance.

Section 10.9 Distribution or Notice to Representative.

   Whenever a distribution is to be made or a notice given to holders of Senior
Debt, the distribution may be made and the notice given to their
representative.

   Upon any payment or distribution of assets of the Company referred to in
this Article X, the Trustee and the Holders shall be entitled to rely upon any
order or decree made by any court of competent jurisdiction in which
bankruptcy, dissolution, winding-up, liquidation or reorganization proceedings
are pending or upon any certificate of any representative of any holder of
Senior Debt or of the liquidating trustee or agent or other Person making any
distribution, delivered to the Trustee or to the Holders, for the purpose of
ascertaining the Persons entitled to participate in such distribution, the
holders of the Senior Debt and other indebtedness of the Company, the amount
thereof or payable thereon, the amount or amounts paid or distributed thereon
and all other facts pertinent thereto or to this Article X.

Section 10.10 Rights of Trustee and Paying Agent.

   Notwithstanding the provisions of this Article X or any other provision of
this Indenture, the Trustee shall not be charged with knowledge of the
existence of any facts which would prohibit the making of any payment or
distribution by the Trustee, or the taking of any action by the Trustee, and
the Trustee or Paying Agent may continue to make payments on the Senior
Collateralized Notes unless it shall have received at its Corporate Trust
Office at least five Business Days prior to the date of such payment written
notice of facts that would cause the payment of any Obligations with respect
to the Senior Collateralized Notes to violate this Article, which notice,
unless specified by a holder of Senior Debt as such, shall not be deemed to be
a Payment Notice. The Trustee may conclusively rely on such notice. Only the
Company or a holder of Senior Debt may give the notice. Nothing in this
Article X shall apply to amounts due to, or impair the claims of, or payments
to, the Trustee under or pursuant to Section 7.7 hereof.

   The Trustee in its individual or any other capacity may hold Senior Debt
with the same rights it would have if it were not Trustee. Any Agent may do
the same with like rights.

Section 10.11 Authorization to Effect Subordination.

   Each Holder of a Senior Collateralized Note by his acceptance thereof
authorizes and directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate, as between the holders of





                                      A-28

<PAGE>
Senior Debt and the Holders, the subordination as provided in this Article X,
and appoints the Trustee his attorney-in-fact for any and all such purposes.

Section 10.12 Article Applicable to Paying Agent.

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

Section 10.13 Miscellaneous.

   (a) The agreements contained in this Article X shall continue to be
effective or be reinstated, as the case may be, if at any time any payment of
any of the Senior Debt is rescinded or must otherwise be returned by any
holder of Senior Debt upon the insolvency, bankruptcy or reorganization of the
Company or otherwise, all as though such payment had not been made.

   (b) The Trustee shall notify all holders of Senior Debt (of whose identity
the Trustee has received reasonable advance written notice) of the existence
of any Default or Event of Default under Section 6.1 promptly after a
Responsible Officer of the Trustee actually becomes aware thereof; provided,
however, that at least five Business Days prior to the notification of any
holder of Senior Debt under this Section 10.13, the Trustee shall provide the
Company with notice of its intent to provide such notification, provided
further, however, that no defect in the form or delivery of the Trustee's
notice to the Company shall preclude the timely notice by the Trustee to the
holders of Senior Debt.

                                  ARTICLE XI.
                      COLLATERAL AND COLLATERAL DOCUMENTS

Section 11.1 Collateral and Collateral Documents.

   (a) In order to secure the due and punctual payment of the Senior
Collateralized Notes, the Company and/or its Affiliates have entered into the
Collateral Documents to create the Note Liens on the Collateral in accordance
with the terms thereof. Pursuant to the provisions of the Collateral Documents
and this Indenture, the rights and remedies of the Trustee and the Holders of
the Senior Collateralized Notes in the Collateral shall be subordinate and
subject to the rights and remedies of the holders of the Priority Liens in
accordance with the terms of this Indenture and the Collateral Documents. In
the event of a Conflict among the terms of this Indenture and the Collateral
Documents, the Collateral Documents shall control.

   (b) Each Holder of a Senior Collateralized Note, by accepting such Senior
Collateralized Note, agrees to all of the terms and provisions of the
Collateral Documents.

   (c) The Company shall not, and shall not permit its Affiliates to, grant any
additional Lien on any of the Collateral unless the Company has determined
that after giving effect to the granting of such Lien, the Collateral Coverage
Ratio shall not be less than 1.5 to 1.0.

Section 11.2 Possession, Use and Release of Collateral.

   (a) Subject to the terms of the Collateral Documents and the terms hereof,
the Company or its Affiliates, as the case may be, will have the right to
remain in possession of the Collateral securing the Senior Collateralized
Notes and to collect, invest and dispose of any income thereon.

   (b) Each Holder of a Senior Collateralized Note, by accepting such Senior
Collateralized Note, acknowledges that (i) the Collateral Documents shall
provide that so long as any Priority Lien Obligations are outstanding, the
holders thereof shall have the exclusive right and authority to determine the
release, sale, or other disposition with respect to any assets of the Company
or its Affiliates, as applicable (including the Collateral) and to change,
waive or vary the Collateral Documents subject in the case of changes,
waivers, or variances, to the conditions specified in the Collateral Documents
and (ii) the holders of the Priority Lien Obligations may (x) direct the
Trustee to take actions with respect to the Collateral (including the release of

                                      A-29

<PAGE>
the Collateral and the manner of realization) without the consent of the
Holders and (y) agree to modify the Priority Lien Security Documents, without
the consent of the Holders or the Trustee, to secure additional Indebtedness
and additional secured creditors so long as such modifications do not
expressly violate the provisions of any Credit Agreement or this Indenture.
Subject to the terms of the Collateral Documents, if at any time or from time
to time Collateral which also secures the Priority Lien Obligations is
released or otherwise disposed of, such Collateral securing the Senior
Collateralized Notes shall be automatically released or disposed of, provided,
however, that if an Event of Default under this Indenture exists or any Senior
Collateralized Note Obligation remains outstanding as of the date on which the
Priority Lien Obligations are repaid in full, the Note Liens on the proceeds
from the sale, transfer or other disposition of such Collateral securing the
Senior Collateralized Notes shall not be released until such Event of Default
and all other Events of Default shall have been cured or otherwise waived and
all such outstanding Note Obligations are paid in full in accordance with the
terms of this Indenture, except to the extent such Collateral was disposed of
in order to repay the Priority Lien Obligations.

   (c) Notwithstanding the provisions set forth in this Section 11.3, the
Company or its Affiliates, as the case may be, may, without any release or
consent by the Trustee, take any and all actions in the ordinary course of
business in respect of the Collateral to the extent permitted under the
Collateral Documents and this Indenture.

Section 11.3 Opinion of Counsel.

   So long as the Collateral Documents have not been terminated in accordance
with the terms thereof, the Company shall deliver to the Trustee, so long as
such delivery is required by Section 314(b) of the TIA, on the Issue Date and
thereafter, at least annually, within 30 days of December 31 of each year
(commencing with December 31, 2004), an Opinion of Counsel either stating that
in the opinion of such counsel, such action has been taken with respect to the
recording, filing, recording and refiling of the Indenture or any Collateral
Document as is necessary to maintain the Note Liens, and reciting the details
of such action, or stating that in the opinion of such counsel, no such action
is necessary to maintain such Note Liens.

Section 11.4 Further Assurances.

   The Company and its Affiliates shall, at their own expense, make, execute,
endorse, acknowledge, file and/or deliver to the Trustee from time to time
such lists, descriptions and designations of its Collateral, warehouse
receipts, receipts in the nature of warehouse receipts, documents of title,
vouchers, invoices, schedules, confirmatory assignments, conveyances,
financing statements, transfer endorsements, powers of attorney, certificates,
reports and other assurances or instruments and take such further steps
relating to the Collateral and other property or rights covered by the Note
Liens, which the Trustee under the Collateral Documents deems reasonably
appropriate or advisable to perfect, preserve or protect the security interest
of the Note Lien in the Collateral.

Section 11.5 Trust Indenture Act Requirements.

   The release of any Collateral from the Note Lien of any of the Collateral
Documents or the release of, in whole or in part, the Note Liens created by
any of the Collateral Documents, will not be deemed to impair the Senior
Collateralized Note Lien in contravention of the provisions hereof if and to
the extent the Collateral or Note Liens are released pursuant to the
applicable Collateral Documents and the terms hereof. Each of the Holders of
the Senior Collateralized Notes acknowledges that a release of Collateral or
Note Liens strictly in accordance with the terms of the Collateral Documents
and the terms hereof will not be deemed for any purpose to be an impairment of
the Collateral, the Collateral Documents or otherwise contrary to the terms of
this Indenture.

Section 11.6 Suits to Protect the Collateral.

   Subject to the provisions hereof and of the Collateral Documents, the
Trustee shall have the authority to institute and to maintain such suits and
proceedings as the Trustee may deem expedient to prevent any impairment of the
Collateral by any acts which may be unlawful or in violation of any of the
Collateral

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<PAGE>
Documents or this Indenture, and such suits and proceedings as the Trustee may
deem expedient to preserve or protect its interests and the interests of the
Holders of the Senior Collateralized Notes in the Collateral (including suits
or proceedings to restrain the enforcement of or compliance with any
legislative or other governmental enactment, rule or order that may be
unconstitutional or otherwise invalid if the enforcement of, or compliance
with, such enactment, rule or order would impair the Note Liens or be
prejudicial to the interests of the Holders of the Senior Collateralized
Notes).

Section 11.7 Purchaser Protected.

   In no event shall any purchaser in good faith or other transferee of any
property purported to be released hereunder or under the Collateral Documents
be bound to ascertain the authority of the Trustee to authorize the release or
to inquire as to the satisfaction of any conditions required by the provisions
hereof for the exercise of such authority or to see to the application of any
consideration given by such purchaser or other transferee; nor shall any
purchaser or other transferee of any property or rights permitted to be sold
hereunder and the Collateral Documents, be under obligation to ascertain or
inquire into the authority of the Company, to make any such sale or other
transfer.

Section 11.8 Powers Exercisable by Receiver or Trustee.

   In case the Collateral shall, be in the possession of a receiver or trustee,
lawfully appointed, the powers conferred in this Article XI upon the Company
and its Affiliates, with respect to the release, sale or other disposition of
such property may be exercised by such receiver or trustee, and an instrument
signed by such receiver or trustee shall be deemed the equivalent of any
similar instrument of the Company and its Affiliates, or of any officer or
officers thereof required by the provisions of this Article XI.

Section 11.9 Release upon Termination of Company's Obligations.

   In the event that the Company delivers an Officers' Certificate and Opinion
of Counsel certifying that its obligations under this Indenture have been
satisfied and discharged by complying with the provisions of Article VIII, the
Trustee shall (i) authorize the Company or its Affiliates, as the case may be,
to execute and deliver such releases, termination statements and other
instruments (in recordable form, where appropriate) as the Company or its
Affiliates may reasonably request to evidence the termination of the Note
Liens created by the Collateral Documents and (ii) not be deemed to hold the
Note Liens for its benefit and the benefit of the Holders of the Senior
Collateralized Notes.

                                  ARTICLE XII.
                                 MISCELLANEOUS

Section 12.1 Trust Indenture Act Controls.

   If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by TIA ss. 318(c), the imposed duties shall control.

Section 12.2 Notices.

   Any notice, instruction, direction, request or other communication by the
Company, the Trustee or any other holder of Senior Debt to the others is duly
given if in writing and delivered in person or mailed by first-class mail
(registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next day delivery, to the other's address:

   If to the Company:

      AMERICAN BUSINESS FINANCIAL SERVICES, INC.
      The Wanamaker Building
      100 Penn Square East
      Philadelphia, Pennsylvania 19004

      Attention: Anthony J. Santilli
                 Chairman, President and Chief Executive Officer
      Telecopier: (215)


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<PAGE>
   With a copy to:

      BLANK ROME LLP
      One Logan Square
      Philadelphia, Pennsylvania 19103-2599
      Attention: Jane K. Storero, Esquire
      Telecopier: (215) 569-5709

   If to the Trustee:


      U.S. BANK NATIONAL ASSOCIATION
      Mail Code EP-MN-WS3C
      60 Livingston Avenue
      St. Paul, Minnesota 55107
      Attention: Mr. Richard Prokosch, Corporate Finance
      Phone: (651) 495-3918
      Telecopier: (651) 495-8097

   If to a holder of Senior Debt, such address as such holder of Senior Debt
shall have provided in writing to the Company and the Trustee.

   The Company, the Trustee or a holder of Senior Debt by notice to the Company
and the Trustee may designate additional or different addresses for subsequent
notices or communications.

   All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt acknowledged,
if telecopied; and the next Business Day after timely delivery to the courier,
if sent by nationally recognized overnight air courier guaranteeing next day
delivery.

   Any notice or communication to a Holder shall be mailed by first-class mail,
certified or registered, return receipt requested, to his address shown on the
register kept by the Registrar. Failure to mail a notice or communication to a
Holder or any defect in it shall not affect its sufficiency with respect to
other Holders.

   If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives
it.

   If the Company mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.

Section 12.3 Communication by Holders with Other Holders.

   Holders may communicate pursuant to TIA ss. 312(b) with other Holders with
respect to their rights under this Indenture or the Senior Collateralized
Notes. The Trustee is subject to ss. 312(b). The Company, the Trustee, the
Registrar and anyone else shall have the protection of TIA ss. 312(c).

Section 12.4 Certificate and Opinion as to Conditions Precedent.

   Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:

      (1) an Officers' Certificate in form and substance reasonably
   satisfactory to the Trustee (which shall include the statements set forth in
   Section 12.5) stating that, in the opinion of the signers, all conditions
   precedent and covenants, if any, provided for in this Indenture relating to
   the proposed action have been complied with; and

      (2) an Opinion of Counsel in form and substance reasonably satisfactory
   to the Trustee (which shall include the statements set forth in Section
   12.5) stating that, in the opinion of such counsel, all such conditions
   precedent and covenants have been complied with.


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<PAGE>
Section 12.5 Statements Required in Certificate or Opinion.

   Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA ss. 314(a)(4)) shall include:

      (1) a statement that the Person making such certificate or opinion has
   read such covenant or condition;

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

      (3) a statement that, in the opinion of such Person, he has made such
   examination or investigation as is necessary to enable him to express an
   informed opinion whether such covenant or condition has been complied with;
   and

      (4) a statement whether, in the opinion of such Person, such condition or
   covenant has been complied with.

Section 12.6 Rules by Trustee and Agents.

   The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.

Section 12.7 Legal Holidays.

   A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions in the Commonwealth of Pennsylvania or the city of Wilmington,
Delaware or at a place of payment are authorized or obligated by law,
regulation or executive order to remain closed. If a payment date is a Legal
Holiday at a place of payment, payment may be made at that place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue for
the intervening period.

Section 12.8 No Recourse Against Others.

   No director, officer, employee, agent, manager or stockholder of the Company
as such, shall have any liability for any obligations of the Company under the
Senior Collateralized Notes or this Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. Each Holder by
accepting a Senior Collateralized Note waives and releases all such liability.

Section 12.9 Duplicate Originals.

   The parties may sign any number of copies of this Indenture. One signed copy
is enough to prove this Indenture.

Section 12.10 Governing Law.

   THE INTERNAL LAW OF THE STATE OF DELAWARE SHALL GOVERN THIS INDENTURE AND
THE SECURITIES, WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS THEREOF.

Section 12.11 No Adverse Interpretation of Other Agreements.

   This Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company. Any such indenture, loan or debt agreement may not
be used to interpret this Indenture.

Section 12.12 Successors.

   All agreements of the Company in this Indenture and the Senior
Collateralized Notes shall bind its successors. All agreements of the Trustee
in this Indenture shall bind its successor.


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<PAGE>
Section 12.13 Severability.

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

Section 12.14 Counterpart Originals.

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

Section 12.15 Table of Contents, Headings, etc.

   The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof and shall in no way modify or
restrict any of the terms or provisions thereof.

Section 12.16 Time.

   All time references used herein shall mean the time in effect in
Philadelphia Pennsylvania, USA.

                            {SIGNATURE PAGE FOLLOWS}


                                      A-34

<PAGE>
                                   SIGNATURES


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


                               AMERICAN BUSINESS FINANCIAL SERVICES, INC.

                     (SEAL)    By: /s/  Anthony J. Santilli
                               _________________________________________________


                               Name:    Anthony J. Santilli
                                     ___________________________________________


                               Title:   Chairman, President and
                                        Chief Executive Officer
                                     __________________________________________



Attest: /s/  Stephen M. Giroux


                               U.S. BANK NATIONAL ASSOCIATION, as Trustee


                               By: /s/  Richard Prokosch
                               _________________________________________________


                                Name:   Richard Prokosch
                                     ___________________________________________

                               Title:   Vice President
                                     __________________________________________






                         {SIGNATURE PAGE TO INDENTURE}


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