Document:

<PAGE>

                                                                  Conformed Copy

                                                                    Exhibit 10.1

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                          TRUST INDENTURE, MORTGAGE,

                  ASSIGNMENT OF LEASE AND SECURITY AGREEMENT

                                   (1996-A)

                                     among

                           WILMINGTON TRUST COMPANY,

                         as Corporate Grantor Trustee

                              THOMAS P. LASKARIS,

                         as Individual Grantor Trustee

                             The Bank of New York,

                        as Corporate Indenture Trustee

                              FREDERICK W. CLARK,

                        as Individual Indenture Trustee

                         Dated as of November 15, 1996

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                               TABLE OF CONTENTS
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ARTICLE I   DEFINITIONS.................................................................................................    5
     SECTION 1.01.  Definitions.........................................................................................    5

ARTICLE II  THE SECURED NOTES...........................................................................................    6
     SECTION 2.01.  Secured Notes.......................................................................................    6
     SECTION 2.02.  Payments from Indenture Estate Only.................................................................    7
     SECTION 2.03.  Method of Payment...................................................................................    7
     SECTION 2.04.  Note Register.......................................................................................    9
     SECTION 2.05.  Registered Owners...................................................................................    9
     SECTION 2.06.  Transfer, Exchange and Replacement of Notes.........................................................    9
     SECTION 2.07.  New Notes; Payment of Expenses......................................................................   11
     SECTION 2.08.  Additional Notes....................................................................................   11
     SECTION 2.09.  Termination of Interest in Indenture Estate.........................................................   15
     SECTION 2.10.  Equally and Ratably Secured.........................................................................   15
     SECTION 2.11.  CUSIP or CINS Numbers...............................................................................   15

ARTICLE III REDEMPTION AND REFUNDING....................................................................................   16
     SECTION 3.01.  Generally...........................................................................................   16
     SECTION 3.02.  Mandatory Redemption................................................................................   16
     SECTION 3.03.  [Intentionally Omitted].............................................................................   19
     SECTION 3.04.  Assumption of Obligations of the Grantor Trustee by the Lessee......................................   19
     SECTION 3.05.  Refunding...........................................................................................   22
     SECTION 3.06.  Grantor Trustee's and Owner Participant's Option to Redeem or Purchase Secured Notes................   22
     SECTION 3.07.  Deposited Redemption or Purchase Moneys.............................................................   24
     SECTION 3.08.  Acquisition of Secured Notes........................................................................   25
     SECTION 3.09.  Condition to Redemption and Refunding...............................................................   25
     SECTION 3.10.  Notice of Certain Redemptions.......................................................................   25

ARTICLE IV  RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME FROM THE INDENTURE ESTATE...................................   27
     SECTION 4.01.  Basic Rent Distribution.............................................................................   27
     SECTION 4.02.  Certain Distributions...............................................................................   28
     SECTION 4.03.  Distributions After Indenture Event of Default......................................................   29
     SECTION 4.04.  Application of Payments on Secured Notes............................................................   31
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     SECTION 4.05.  Application of Payments According to Applicable Operative Document Provisions.......................   31
     SECTION 4.06.  Amounts Received for Which No Provision Is Made.....................................................   33
     SECTION 4.07.  Payment Procedures..................................................................................   33

ARTICLE V   COVENANTS OF GRANTOR TRUSTEE; CERTAIN AGREEMENTS; INDENTURE EVENTS OF DEFAULT; REMEDIES OF INDENTURE
                TRUSTEE.................................................................................................   34
     SECTION 5.01.  Covenants of Grantor Trustee; Certain Agreements....................................................   34
     SECTION 5.02.  Indenture Event of Default..........................................................................   36
     SECTION 5.03.  Certain Rights......................................................................................   38
     SECTION 5.04.  Remedies............................................................................................   40
     SECTION 5.05.  Suit; Possession; Title; Sale of Indenture Estate...................................................   43
     SECTION 5.06.  Remedies Cumulative.................................................................................   47
     SECTION 5.07.  Discontinuance of Proceedings.......................................................................   47
     SECTION 5.08.  Waiver of Past Defaults.............................................................................   48
     SECTION 5.09.  No Action Contrary to Lessee's Rights Under the Lease...............................................   48
     SECTION 5.10.  Rights of Holders of Secured Notes..................................................................   48
     SECTION 5.11.  Limitation on Suits by Holders......................................................................   49
     SECTION 5.12.  Trustee May File Proofs of Claim....................................................................   49

ARTICLE VI  DUTIES OF THE INDENTURE TRUSTEE.............................................................................   50
     SECTION 6.01.  Certain Actions.....................................................................................   50
     SECTION 6.02.  Action Upon Instructions............................................................................   50
     SECTION 6.03.  Release of Lien of Indenture........................................................................   51
     SECTION 6.04.  Indemnification.....................................................................................   52
     SECTION 6.05.  No Implied Duties...................................................................................   53
     SECTION 6.06.  Duties to Remove Certain Liens......................................................................   53
     SECTION 6.07.  No Action Except Under Operative Documents or Instructions..........................................   53
     SECTION 6.08.  Certain Rights of the Grantor Trustee and the Owner Participant.....................................   54
     SECTION 6.09.  Filing of Financing and Continuation Statements.....................................................   55
     SECTION 6.10.  Furnishing of Notices...............................................................................   55
     SECTION 6.11.  Taxes; Withholdings; Information Reporting..........................................................   56

ARTICLE VII THE INDENTURE TRUSTEE AND THE GRANTOR TRUSTEE...............................................................   56
     SECTION 7.01.  Acceptance of Trusts and Duties.....................................................................   56
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     SECTION 7.02.  Absence of Duties Except as Specified...............................................................   57
     SECTION 7.03.  No Representations or Warranties....................................................................   57
     SECTION 7.04.  No Segregation of Moneys; No Interest; Investments..................................................   58
     SECTION 7.05.  Reliance; Agents; Advice of Counsel.................................................................   58
     SECTION 7.06.  No Compensation from Holders or Indenture Estate....................................................   59
     SECTION 7.07.  Right of the Indenture Trustee to Perform Covenants, Etc............................................   60
     SECTION 7.08.  Moneys for Payments in Respect of Notes to be Held in Trust.........................................   60
     SECTION 7.09.  Disposition of Moneys Held for Payments of Notes....................................................   61

ARTICLE VIII  SUCCESSOR TRUSTEES AND ADDITIONAL TRUSTEES................................................................   61
     SECTION 8.01.  Notice of Successor Grantor Trustees................................................................   61
     SECTION 8.02.  Resignation of Indenture Trustee; Appointment of Successor..........................................   61
     SECTION 8.03.  Co-Trustees and Separate Trustees...................................................................   63

ARTICLE IX  SUPPLEMENTS AND AMENDMENTS TO THIS INDENTURE AND OTHER DOCUMENTS............................................   66
     SECTION 9.01.  Indenture Supplements Without Consent of Holders....................................................   66
     SECTION 9.02.  Supplements and Amendments to Indenture with Consent of Holders of Notes............................   68
     SECTION 9.03.  Execution of Indenture Supplement, Amendments, Etc..................................................   73
     SECTION 9.04.  Effect of Indenture Supplement......................................................................   74
     SECTION 9.05.  Reference in Secured Notes to Indenture Supplements.................................................   74
     SECTION 9.06.  Notices of Indenture Supplements and Amendments, Etc................................................   74
     SECTION 9.07.  Lessee Rights.......................................................................................   74

ARTICLE X  MISCELLANEOUS................................................................................................   75
     SECTION 10.01.  Termination of Indenture...........................................................................   75
     SECTION 10.02.  No Legal Title to Indenture Estate in Holders......................................................   75
     SECTION 10.03.  Power of Attorney..................................................................................   75
     SECTION 10.04.  Regarding the Grantor Trustee......................................................................   76
     SECTION 10.05.  Notices............................................................................................   77
     SECTION 10.06.  Severability of Provisions.........................................................................   77
     SECTION 10.07.  No Oral Modification or Continuing Waivers.........................................................   77
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     SECTION 10.08.  Successors and Assigns.............................................................................   78
     SECTION 10.09.  Headings; Table of Contents........................................................................   78
     SECTION 10.10.  Normal Commercial Relations........................................................................   78
     SECTION 10.11.  Governing Law......................................................................................   78
     SECTION 10.12.  Execution..........................................................................................   78
     SECTION 10.13.  Security Agreement.................................................................................   79
     SECTION 10.14.  Benefits of Indenture..............................................................................   79
     SECTION 10.15.  Personal Property..................................................................................   79
     SECTION 10.16.  Individual Indenture Trustee.......................................................................   79
     SECTION 10.17.  Special Louisiana Provisions.......................................................................   79

Appendix A.............Definitions
Schedule 1.............Description of Undivided Interest in Production System
Schedule 2.............Resolution

Exhibit A..............Form of Secured Note

Exhibit B..............Principal Amounts of Secured Notes, Interest Rate and Amortization Schedule

Exhibit C..............Relevant Amendment

Exhibit D..............Form of Indenture Supplement

Exhibit E..............Form of Relevant Date Supplement

Exhibit F..............N/A

Exhibit G ............ Form of Naval Mortgage
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                                      iv
<PAGE>

                TRUST INDENTURE, MORTGAGE, ASSIGNMENT OF LEASE
                            AND SECURITY AGREEMENT
                                   (1996-A)

          BE IT KNOWN, that on the date hereinafter set forth, before me, the
undersigned Notary Public, duly commissioned and qualified in and for the State
of New York, and in the presence of the undersigned, competent witnesses,
personally came and appeared: WILMINGTON TRUST COMPANY, a Delaware banking
corporation, not in its individual capacity, except as expressly provided
herein, but solely as Corporate Grantor Trustee under the Trust Agreement
(together with its successors and permitted assigns, the "Corporate Grantor
Trustee") represented herein by its undersigned, James P. Lawler, appearing
herein by resolution of its Board of Directors, a certified copy of which is
annexed hereto as Schedule 2, Thomas P. Laskaris, an individual, not in his
individual capacity, except as expressly provided herein, but solely as
Individual Grantor Trustee under the Trust Agreement (together with his
successors and permitted assigns, the "Individual Grantor Trustee"; together
with the Corporate Owner Trustee, the "Grantor Trustee"), The Bank of New York,
a New York banking corporation, not in its individual capacity, except as
expressly provided herein, but solely as Corporate Indenture Trustee (together
with its successors and permitted assigns, the "Corporate Indenture Trustee"),
and Frederick W. Clark, an individual, not in his individual capacity, except as
expressly provided herein, but solely as Individual Indenture Trustee (together
with his successors and permitted assigns, the "Individual Indenture Trustee";
together with the Corporate Indenture Trustee, the "Indenture Trustee") who each
being duly sworn, did declare and say as follows:

                             W I T N E S S E T H :

          WHEREAS, the Owner Participant, Laskaris and the Corporate Grantor
Trustee have heretofore entered into the Trust Agreement, whereby, among other
things, Laskaris and the Trust Company each in its or his capacity as Grantor
Trustee thereunder has declared a certain trust for the use and benefit of the
Owner Participant, subject, however, to the Lien of this Indenture, and the
Grantor Trustee is authorized and directed to execute and deliver this
Indenture;

          WHEREAS, the Grantor Trustee, desires by this Indenture, to provide
among other things (i) for the issuance by the Grantor Trustee to the Pass
Through Trustee the Secured Notes specified in Exhibit A hereto upon payment by
such Pass Through Trustee of the principal amount of such Secured Notes, and
(ii) for the assignment, mortgage and pledge by the Grantor Trustee to the
Indenture Trustee, as part of the Indenture Estate hereunder, among other
things, of all of the right, title and interest of the Grantor Trustee, other
than Excepted Payments, in, to and under, as the case may be, the Undivided
Interest, the Lease, the Head Lease, the Assignment and Assumption Agreement,
the Agency and
<PAGE>

Support Agreement, the Ship Mortgage and all payments and other amounts received
thereunder, other than Excepted Payments, in accordance with the terms thereof,
as security for, among other things, the Grantor Trustee's obligations to the
Indenture Trustee, the Loan Participants and the other Holders and for the
benefit and security of the Loan Participants and such Holders;

          WHEREAS, all things have been done to make the Secured Notes, when
executed by the Grantor Trustee and authenticated, issued and delivered
hereunder, the legal, valid, binding and enforceable obligations of the Grantor
Trustee in accordance with their terms; and

          WHEREAS, all things necessary to make this Indenture the legal, valid,
binding and enforceable obligation of the Grantor Trustee, for the uses and
purposes herein set forth, in accordance with its terms, have been done and
performed and have happened, and the Indenture Trustee has duly accepted the
trust created hereby and as evidence thereof has joined in the execution hereof;

          NOW, THEREFORE, THIS TRUST INDENTURE, MORTGAGE, ASSIGNMENT OF LEASE
AND SECURITY AGREEMENT, WITNESSETH, that, to secure (i) the prompt payment when
and as due and payable of the principal of, Make-Whole Amount, if any, and
interest on, all the Secured Notes from time to time Outstanding hereunder and
of all other amounts payable to the Holders (whether as Holders or Loan
Participants) hereunder, under the Secured Notes and under the other Operative
Documents (other than the Tax Indemnity Agreement and other than Section 12 of
the Participation Agreement), (ii) the performance and observance by the Grantor
Trustee of all the provisions, covenants and agreements for the benefit,
directly or indirectly, of the Indenture Trustee or the Holders herein, in the
Participation Agreement, in the Secured Notes and in the other Operative
Documents (other than the Tax Indemnity Agreement), and (iii) the performance
and observance by the Owner Participant of its covenants and agreements for the
benefit, directly or indirectly, of the Indenture Trustee or the Holders in the
Operative Documents (other than the Tax Indemnity Agreement) (the obligations
described in the above clauses (i), (ii) and (iii) collectively, the "Indenture
Indebtedness"), and for the uses and purposes and subject to the terms and
provisions hereof, and in consideration of the premises and of the covenants
herein contained and of the acceptance of the Secured Notes by the Holders
thereof:

                                GRANTING CLAUSE

          The Grantor Trustee, for valuable consideration, and in order to
secure the payment and performance of the Indenture Indebtedness, hereby agrees
to irrevocably mortgage, hypothecate and pledge unto the Indenture Trustee and
to create a security interest in, to and for the benefit of the Corporate
Indenture Trustee or, to the extent set forth in Section 8.03 below, the
Individual Indenture Trustee, and upon delivery

                                       2
<PAGE>

of Indenture Supplement No. 1, shall have irrevocably mortgaged, hypothecated,
and pledged unto the Indenture Trustee and created a security interest to and
for the benefit of the Corporate Indenture Trustee or, to the extent set forth
in Section 8.03 below, the Individual Indenture Trustee, all of the right, title
and interest of the Grantor Trustee in and to the following property, rights and
privileges, other than Excepted Payments, now owned or in the future acquired by
the Grantor Trustee or in which the Grantor Trustee now has or may in the future
acquire any estate, right, title or interest (which collectively, excluding
Excepted Payments but including all property hereafter subjected to the Lien of
this Indenture, shall constitute the "Indenture Estate"), to wit:

          (a) the Undivided Interest described in Schedule 1, including without
     limitation the Lessor's Share of any Component or Replacement Component or
     Modification to the Production System which, pursuant to the terms of the
     Lease, are the property of the Grantor Trustee;

          (b) the Assignment and Assumption Agreement, Head Lease, the Ship
     Mortgage, and all rights, powers and remedies of the Grantor Trustee
     pursuant thereto, whether arising thereunder or by statute, at law, in
     equity or otherwise;

          (c) the Lease including, without limitation, (i) all amounts of Rent,
     insurance proceeds and requisition, indemnity or other payments of any kind
     for or with respect to any asset leased or subleased thereunder, (ii) all
     right of the Grantor Trustee to exercise any election or option, or to give
     any notice, consent, waiver or approval under or in respect of the Lease,
     or to accept any surrender or enter into any modification thereof, as the
     case may be, and (iii) all rights, powers and remedies of the Grantor
     Trustee pursuant to the Lease, whether arising thereunder or by statute, at
     law, in equity or otherwise, including, without limitation, the right to
     possession of any asset demised thereunder;

          (d) the Agency and Support Agreement, including without limitation (i)
     all amounts payable thereunder, (ii) all right of the Grantor Trustee to
     exercise any election or option, or to give any notice, consent, waiver or
     approval under or in respect of the Agency and Support Agreement, or to
     accept any surrender or enter into any modification thereof, as the case
     may be, and (iii) all rights, powers and remedies of the Grantor Trustee
     pursuant to the Agency and Support Agreement, whether arising thereunder or
     by statute, at law, in equity or otherwise;

          (e) all moneys and securities now or hereafter paid or deposited or
     required to be paid or deposited to or with the Indenture Trustee pursuant
     to any term of any Operative Document, and held or required to be held by
     the Indenture Trustee hereunder;

                                       3
<PAGE>

          (f) to the extent assignable, any and all permits, certificates,
     approvals and authorizations, however characterized, issued or in any way
     furnished in connection with the Undivided Interest, whether necessary or
     not for the operation and use of the Undivided Interest;

          (g) all the tolls, rents, issues, profits, products, revenues and
     other income of the property subjected or required to be subjected to the
     Lien of this Indenture; and

          (h) all rights or property which may be received upon the exercise of
     any remedy or option contained in any of the above-described instruments
     and all proceeds in whatever form of all or any part of any of the
     foregoing;

          EXCLUDING, HOWEVER, from the foregoing grant, and thereby from the
Lien of this Indenture and from the Indenture Estate any and all Excepted
Payments; and

          SUBJECT to the rights of the Grantor Trustee and the Owner Participant
hereunder;

          TO HAVE AND TO HOLD the aforesaid property unto the Corporate
Indenture Trustee, or the Individual Indenture Trustee, as the case may be, its
or his successors and assigns, for the benefit and security of the Holders,
without any priority of any one Secured Note over any other except as expressly
provided herein with respect to Additional Notes, and for the uses and purposes
and subject to the terms and conditions set forth in this Indenture. This
Indenture is a mortgage given to secure the payment and performance of the
Indenture Indebtedness and this Indenture is also intended to operate as, among
other things, a security agreement and an assignment of leases and rents.

          It is expressly agreed that anything contained in this Indenture to
the contrary notwithstanding, the Grantor Trustee shall remain liable under the
Lease and the other Operative Documents to perform all of the obligations of the
Grantor Trustee thereunder, all in accordance with and pursuant to the terms and
provisions of each thereof, and the Holders and, except as expressly provided
herein, the Indenture Trustee shall have no obligation or liability under any
Operative Document by reason of or arising out of this Indenture. None of the
Indenture Trustee or any Holder shall be required or obligated in any manner to
perform or fulfill any obligation of the Grantor Trustee under or pursuant to
any Operative Document or, except as herein expressly provided, to make any
payment, or to make any inquiry as to the nature or sufficiency of any payment
received by them, or to present or file any claim, or to take any action to
collect or enforce the payment of any amounts which may have been assigned to
them or to which they may be entitled at any time.

          Accordingly, the Grantor Trustee and the Indenture Trustee

                                       4
<PAGE>

hereby agree for themselves and for the benefit and security of the Holders as
follows:

                                   ARTICLE I

                                  DEFINITIONS

          SECTION 1.01.  Definitions. Unless otherwise defined herein, for the
purposes hereof, capitalized terms used herein and not otherwise defined shall
have the meanings assigned to them in Appendix A. References in this Indenture
to Sections, subsections, paragraphs, Schedules, Appendices and Exhibits are to
Sections, subsections and paragraphs in, and Schedules, Appendices and Exhibits
to, this Indenture unless otherwise indicated.

                                  ARTICLE II

                               THE SECURED NOTES

          SECTION 2.01.  Secured Notes. (a) Generally. Except for Secured Notes
issued pursuant to Section 2.06 or 2.08, Secured Notes may be issued only on the
Closing Date. On the Closing Date, the Secured Notes to be issued on such Date
pursuant to Section 2.2 of the Participation Agreement shall be duly executed by
the Grantor Trustee by manual or facsimile signature, duly authenticated and
made available for delivery by the Corporate Indenture Trustee and registered in
the name of the Loan Participant to which such Secured Note is being issued and
shall have attached thereto the Amortization Schedule for such Secured Note.
Receipt by the Corporate Indenture Trustee of Secured Notes duly executed by the
Grantor Trustee shall be accompanied by an Officer's Certificate of the Grantor
Trustee instructing the Corporate Indenture Trustee to authenticate, register
and make available for delivery such Secured Notes on the Closing Date.

          (b)  The Secured Notes shall:

             (i)   be limited in aggregate original principal amount to the
     amount specified in Exhibit B hereto;

             (ii)  be issuable only as registered Secured Notes in denominations
     of at least $1,000, or if the remaining principal amount thereof shall be
     less than $1,000, such remaining principal amount;

             (iii) be dated the Closing Date;

             (iv)  bear interest on the unpaid principal amount thereof from the
     date of such Secured Notes at the rate specified in

                                       5
<PAGE>

     Exhibit B (computed on the basis of a 360-day year consisting of twelve 30-
     day months);

             (v)   be due and payable as to principal and interest as specified
     herein and therein;

             (vi)  be prepayable only as provided in Article III; and

             (vii) be substantially of the tenor and in the form set forth in
     Exhibit A.

          (c)  Each Secured Note shall be signed on behalf of the Corporate
Grantor Trustee by a Responsible Officer of the Corporate Grantor Trustee, and
on behalf of the Individual Grantor Trustee, by Laskaris, manually or in
facsimile. No Secured Note shall be secured by or entitled to any benefit under
this Indenture, or be valid for any purpose, unless there appears thereon a
certificate of authentication executed by or on behalf of the Corporate
Indenture Trustee by the manual or facsimile signature of a Responsible Officer
of the Corporate Indenture Trustee, and such certificate on any Secured Note
shall be conclusive evidence that such Secured Note has been duly authenticated
and made available for delivery hereunder.

          SECTION 2.02.  Payments from Indenture Estate Only. All payments of
principal, Make-Whole Amount, if any, and interest to be made by the Grantor
Trustee and, except as otherwise provided in the Operative Documents, all
payments of any other amounts payable by or on behalf of the Grantor Trustee
under the Secured Notes and this Indenture, shall be made only from the income
and proceeds from the Indenture Estate, and only to the extent that the
Indenture Trustee shall have received sufficient income or proceeds from the
Indenture Estate to make such payments in accordance with the terms hereof. Each
Holder, by its acceptance of a Secured Note, agrees that it will look solely to
the income and proceeds from the Indenture Estate to the extent available for
payment as herein provided and that (a) none of the Grantor Trustee or the
Indenture Trustee (whether in its individual or trust capacity) shall be
personally liable to such Holder for any amounts payable under the Secured
Notes, nor, except as specifically provided herein or in the other Operative
Documents, for any amounts payable or any liability under this Indenture and (b)
the Owner Participant shall not be liable to the Indenture Trustee or to any
Holder under any circumstances for any reason whatsoever except to the extent
expressly provided herein or in any other Operative Document.

          SECTION 2.03.  Method of Payment. (a) The principal of, and Make-Whole
Amount, if any, and interest, on each Secured Note shall be payable in
immediately available funds, the receipt of which has been confirmed by a
Responsible Officer of the Corporate Indenture Trustee (which shall be done
promptly upon receipt thereof) on or before

                                       6
<PAGE>

1:00 p.m., New York time, at the place of receipt, on the due date therefor, to
the Corporate Indenture Trustee at the corporate trust office of the Corporate
Indenture Trustee. Amounts so received by the Indenture Trustee shall be paid by
the Indenture Trustee to each Holder on the due date therefor without any
presentment or surrender of any Secured Note held by such Holder by whichever of
the following methods shall be specified by prior written notice from such
Holder to the Indenture Trustee: (i) by transferring prior to 2:00 p.m., New
York City time, on such date, such payment to such Holder in immediately
available funds by crediting the amount to be distributed to such Holder to any
account maintained by such Holder with the Indenture Trustee or (ii) by
initiating a wire transfer prior to the time set forth in clause (i) of this
Section 2.03(a) of such amount in immediately available funds to a banking
institution designated in such notice with bank wire transfer facilities for the
account of such Holder, in all cases without any presentment or surrender of any
Secured Note, except that on the date of the final maturity thereof (whether at
scheduled maturity, upon prepayment, acceleration or otherwise), payment of
principal of such Secured Note shall be made only upon presentation and
surrender of such Secured Note at the corporate trust office of the Corporate
Indenture Trustee. In the event the Indenture Trustee shall fail to make any
payment as provided in the preceding sentence after its receipt of funds at the
place and on or before the time specified in this Section 2.03(a), the Corporate
Indenture Trustee in its individual capacity agrees to compensate each Holder
for loss of use of funds in an amount equal to the interest (computed at the
then prevailing rate of overnight Permitted Investments) which could have been
earned on such funds had they been timely paid to such Holder.

          (b)  Whenever any payment to be made hereunder or pursuant to the
terms of any Secured Note shall be stated to be due on a day which is not a
Business Day, such payment shall be due and payable on the next succeeding
Business Day with the same force and effect as if made on such scheduled date
and (provided such payment is timely made on such succeeding Business Day) no
interest shall accrue on the amount of such payment from and after such
scheduled date.

          (c)  If payment of any installment of principal payable in accordance
with the terms hereof and of the Secured Notes is not paid in full when due,
whether as scheduled or upon acceleration and whether before or after the
maturity date of the Secured Notes, such overdue amount of principal shall (to
the extent not prohibited by applicable law) bear interest, payable on demand,
for each day from and including the date payment thereof was due to the actual
date of payment, at the Overdue Rate.

          (d)  Subject to Section 6.11, the Holder of any Secured Note shall be
entitled to the principal of, and Make-Whole Amount, if any, and interest on
such Secured Note free from all rights of set-off or counterclaims of the
Grantor Trustee, the Indenture Trustee or any prior

                                       7
<PAGE>

Holder of such Secured Note. Nothing set forth in this Section 2.03(d) shall
impair the right of the Grantor Trustee to receive a return from the Indenture
Trustee of any amount intentionally overpaid by the Grantor Trustee in respect
of a Secured Note.

          SECTION 2.04.  Note Register. The Indenture Trustee shall cause to be
kept at the Corporate Indenture Trustee's corporate trust office a register (the
"Note Register") for the registration of Secured Notes and for the registration
of transfer of Secured Notes. The Note Register shall be maintained by the
Corporate Indenture Trustee, and the names and addresses of the registered
Holders of the Secured Notes, transfers of the Secured Notes and the names and
addresses of the transferees of the Secured Notes shall be entered in the Note
Register under such reasonable regulations as the Corporate Indenture Trustee
may prescribe. Each Loan Participant shall be provided reasonable opportunity to
inspect the Note Register from time to time.

          SECTION 2.05.  Registered Owners. The Grantor Trustee and the
Indenture Trustee shall deem and treat any registered Holder as the absolute
owner of any Secured Note held by such Holder, as indicated in the Note
Register, for the purpose of receiving payment of all amounts payable with
respect to such Secured Note and for all other purposes, and neither the Grantor
Trustee nor the Indenture Trustee shall be affected by any notice to the
contrary. All such payments so made shall be valid and effectual to satisfy and
discharge the liability of the Grantor Trustee upon such Secured Note to the
extent of the sum or sums so paid.

          SECTION 2.06.  Transfer, Exchange and Replacement of Notes. (a)
Secured Notes may be transferred only on the Note Register. Any secured Note may
be transferred on the Note Register if such Secured Note is surrendered for
cancellation at the corporate trust office of the Corporate Indenture Trustee
and is accompanied by an instrument of transfer in form and substance reasonably
satisfactory to the Corporate Indenture Trustee, which Secured Note or Secured
Notes shall be canceled by the Indenture Trustee. A new Secured Note or Secured
Notes of the same series, duly executed by the Grantor Trustee and registered in
the name of the transferee or transferees in a principal amount or amounts equal
to the principal amount of such transferred Secured Note, shall be duly
authenticated by the Corporate Indenture Trustee and delivered to the transferee
or transferees named by the Holder of such transferred Secured Note in exchange
for such transferred Secured Note. Promptly after registration of the transfer
of any Secured Note, the Corporate Indenture Trustee shall give notice thereof
to the Lessee and the Grantor Trustee specifying the name and address for
notices of the transferee or transferees.

          (b)  Any Secured Note may be exchanged for a new Secured Note if such
Secured Note to be so exchanged is surrendered for cancellation at the corporate
trust office of the Corporate Indenture Trustee and is accompanied by the
request of the Holder thereof specifying

                                       8
<PAGE>

the denomination of the new Secured Note (which shall be in denominations of at
least $1,000 or if less, the then unpaid principal amount thereof) to be issued
in exchange therefor. Upon instructions from the Indenture Trustee, the Grantor
Trustee shall deliver to the Indenture Trustee a new Secured Note, hereunder in
replacement therefor, duly executed by the Grantor Trustee and registered in the
name of such Holder in the denominations so requested and in an aggregate
principal amount equal to the aggregate principal amount of such Secured Note to
be so exchanged, and such new Secured Note shall be duly authenticated by the
Corporate Indenture Trustee and delivered by the Corporate Indenture Trustee to
such Holder in exchange for such Secured Note to be so exchanged, which Secured
Note shall be canceled by the Corporate Indenture Trustee.

          (c)  If any Secured Note shall become mutilated or be destroyed, lost
or stolen, upon request of the Holder thereof, a new Secured Note, duly executed
by the Grantor Trustee and registered in the name of such Holder of like tenor
and principal amount as the Secured Note so mutilated, destroyed, lost or
stolen, shall be duly authenticated and delivered by the Corporate Indenture
Trustee to such Holder in exchange for such Secured Note, if mutilated, or in
substitution for such Secured Note, if destroyed, lost or stolen. In the case of
a mutilated Secured Note, such Secured Note shall be surrendered for
cancellation at the corporate trust office of the Corporate Indenture Trustee
and shall be canceled by the Corporate Indenture Trustee. In the case of a
destroyed, lost or stolen Secured Note, the Holder thereof shall furnish to the
Grantor Trustee and the Indenture Trustee (i) evidence to their reasonable
satisfaction of the destruction, loss or theft of such Secured Note and
ownership thereof, and (ii) such security or indemnity as may be reasonably
required by them to save them harmless; provided that if the affected Holder is
a Pass Through Trustee, the written agreement of such Holder to indemnify the
Grantor Trustee and the Indenture Trustee (in their respective individual and
trust capacities) with respect to such destroyed, lost or stolen Secured Note,
together with written notice of ownership and destruction, loss or theft
thereof, shall satisfy the conditions of this sentence.

          SECTION 2.07.  New Notes; Payment of Expenses. (a) Each new Secured
Note (a "New Note") issued pursuant to Section 2.06 upon transfer of, in
exchange for or in substitution for a Secured Note (an "Old Note") shall be
dated as of the transfer date of such Old Note. The Indenture Trustee shall mark
on each New Note (i) the date to which principal and interest have been paid on
the applicable Old Note and (ii) all payments and prepayments of principal made
on such Old Note which are allocable to such New Note. Interest shall be deemed
to have been paid on such New Note to the date to which interest was paid on the
applicable Old Note, and all payments and prepayments of principal required to
have been marked on such New Note, as provided in clause (ii) of the preceding
sentence, shall be deemed to have been made thereon. All New Notes issued
pursuant to Section 2.06 in exchange for or in substitution for or in lieu of
Old Notes shall be valid obligations of the Grantor Trustee evidencing the same
debt as such Old Notes and shall be

                                       9
<PAGE>

entitled to the benefits and security of this Indenture to the same extent as
such Old Notes. Issuance of any New Note shall not for any purposes be deemed a
further advance of funds to the Grantor Trustee and the perfection and priority
of the security interest in the Indenture Estate applicable to such New Note
shall for all purposes be the same as that applicable to the Secured Note
replaced by such New Note.

          (b)  Upon the issuance of a New Note or New Notes pursuant to Section
2.06, the Grantor Trustee may require from the party requesting such New Note or
New Notes payment of a sum to reimburse the Grantor Trustee for, or to provide
funds for, the payment of any tax or other governmental charge or any other
charge or expense paid or payable with respect to such transfer by the Grantor
Trustee or the Indenture Trustee, without any right of reimbursement under any
Operative Document with respect to such payments.

          SECTION 2.08.  Additional Notes. (a) So long as no Lease Event of
Default or default of the nature set forth in paragraphs (a), (b), (c) or (g) of
the definition of Lease Event of Default in Section 15 of the Lease, or
Indenture Event of Default shall have occurred and be continuing, Additional
Notes of one or more series may be issued under and secured by this Indenture at
any time or from time to time, subject to the conditions hereinafter provided in
this Section 2.08 and the conditions provided in Section 14.1 to the
Participation Agreement, for the purpose of financing the Lessor's Share of the
cost of any Non-Severable Modification or any Severable Modification required by
law to the Production System as provided in Section 14 of the Participation
Agreement.

          (b)  Prior to the issuance of any Additional Notes pursuant to this
Section 2.08, the Grantor Trustee shall have received from the Owner Participant
and delivered to the Indenture Trustee, not less than forty-five (45) days prior
to the proposed date of issuance of such Additional Notes, a request and
authorization to issue Additional Notes (a "Request"), which Request shall
include the amount of such Additional Notes, the proposed date of issuance of
such Additional Notes, and other details with respect thereto which are not
inconsistent with this Section 2.08. Such Additional Notes shall have a
designation so as to distinguish such Additional Notes from the Initial Secured
Notes and any other Additional Notes that may have been issued theretofore, but
otherwise shall be substantially similar in form to the Initial Secured Notes,
with such omissions therefrom, variations therein and additions thereto as shall
be appropriate. Such Additional Notes shall not rank senior in any respect to
other Secured Notes issued pursuant to the terms hereof but may rank junior in
right of payment and security.

          (c)  The terms, conditions and designations of such Additional Notes
(which shall be consistent with the Request and with the terms of this Indenture
and of the Participation Agreement and such terms, conditions and designations
shall be in form and substance acceptable to

                                       10
<PAGE>

the Owner Participant, the Grantor Trustee and the Indenture Trustee) shall be
set forth in a supplement to this Indenture, substantially in the form of
Exhibit C, which shall be executed by the Grantor Trustee and the Indenture
Trustee. Such indenture supplement shall set forth:

             (i)   the text of such Additional Notes (which, except for the
     terms of payment thereof, shall be of substantially the same effect as the
     text of the Initial Secured Notes set forth in this Indenture, with such
     changes as are consistent with and permitted by this Indenture and which in
     all events shall provide that such Additional Notes are never more than
     pari passu in priority of payment, in right of security and in all other
     respects with the Initial Secured Notes);

             (ii)  the date of maturity of such Additional Notes (which shall be
     no later than the latest scheduled maturity date of the Secured Notes then
     Outstanding);

             (iii) the date from which, and the date or dates on which, interest
     is payable (which shall be Interest Payment Dates);

             (iv)  the terms for the repayment of the principal amount of such
     Additional Notes (each regularly scheduled payment of principal shall be an
     Interest Payment Date);

             (v)   the terms, if any, as to prepayment or redemption of such
     Additional Notes at the option of the Grantor Trustee, and as to the
     premium, if any, payable on any redemption or prepayment of such Additional
     Notes; and

             (vi)  any other terms and agreements in respect thereof provided or
     permitted by this Trust Indenture or necessary to specify the terms and
     conditions on which such Additional Notes shall be issued.

          (d)  Such Additional Notes shall be executed by the Grantor Trustee as
provided in Section 2.01 and deposited with the Corporate Indenture Trustee for
authentication and delivery, but before such Additional Notes shall be
authenticated and delivered by the Corporate Indenture Trustee, there shall be
delivered to or deposited with the Corporate Indenture Trustee the following:

             (i)   the Request;

             (ii)  such supplement to this Indenture, duly executed by the
     Grantor Trustee;

             (iii) a supplement to the Lease, duly authorized, executed and
     delivered by the Lessee and the Grantor Trustee,

                                       11
<PAGE>

     providing for adjustments to the Basic Rent Percentages, Stipulated Loss
     Value Percentages and Termination Value Percentages, and the definition of
     Lessor's Cost under the Lease required to ensure that payments of such
     amounts will be adequate to provide for payments required hereunder and
     under the Secured Notes, after giving effect to the issuance of such
     Additional Notes, together with such instruments of conveyance, assignment
     and transfer, if any, necessary to subject such supplement to the Lease to
     the Lien and security interest of this Indenture and to perfect such Lien
     and security interest subject to no Liens other than Permitted Liens, and
     evidence as to the due recording or filing of each thereof or of financing
     or similar statements with respect thereto;

             (iv)  such instruments of conveyance, assignment and transfer
     (including, without limitation, contractors' waivers) duly executed and
     delivered by the respective parties thereto, and such evidence of the due
     filing thereof or of financing statements or other collateral documents
     with respect thereto, as may be required to convey to the Grantor Trustee
     all property included in the Lessor's Share of such Modification, if any,
     and to subject such property to the Lien of this Indenture, subject to no
     Liens except Permitted Liens;

             (v)   originals or certified copies of all corporate actions
     necessary for the due and valid issue of such Additional Notes, the due and
     valid authorization, execution, delivery and performance by the Grantor
     Trustee of the supplement to this Indenture relating thereto, and the due
     and valid authorization, execution, delivery and performance by the Lessee
     and the Grantor Trustee of the supplement to the Lease and the creation of
     the Lien and security interest thereon referred to above, all of which
     corporate actions shall have been duly obtained and shall be in full force
     and effect; together with evidence as to the due occurrence of all such
     authorization, execution, delivery and performance;

             (vi)   documentation, duly executed and delivered by the respective
     parties thereto whereby the proposed holders of the Additional Notes agree
     to be bound by the terms of the Operative Documents (including, without
     limitation, representations and covenants corresponding to those contained
     in Section 7 of the Participation Agreement);

             (vii)  an Officer's Certificate of the Lessee certifying (1) as to
     the cost of the Lessor's Share of such Modification and (2) that all
     conditions precedent to the issuance of the Additional Notes contained in
     this Section 2.08 and in Section 14 of the Participation Agreement have
     been satisfied unless such conditions have been waived in writing by the
     Indenture Trustee and Grantor Trustee; and

             (viii) such opinions of counsel as are customary in

                                       12
<PAGE>

     transactions of this type, including, without limitation, opinions as to
     the due authorization, execution, delivery and enforceability and the
     creation and perfection of the security interest in the Lessor's Share of
     such Modification (subject to usual or customary exceptions, qualifications
     and assumptions) of such supplement to this Indenture and such Additional
     Notes, and such other certificates and other documents as may be reasonably
     requested by the Indenture Trustee to evidence the validity and binding
     effect of such supplement to this Indenture and such Additional Notes and
     compliance with this Section 2.08.

          (e)  When the documents referred to in Section 2.08(d) shall have been
delivered to or deposited with the Indenture Trustee and when such Additional
Notes described in the Request and the supplement to this Indenture have been
executed by the Grantor Trustee as required by this Indenture, the Corporate
Indenture Trustee shall authenticate and deliver such Additional Notes in the
manner described in such Request, but only upon payment to the Grantor Trustee
of the sum or sums specified in such Request, whereupon the Grantor Trustee
shall pay such sum or sums to the Lessee.

          SECTION 2.09.  Termination of Interest in Indenture Estate. A Holder
shall have no further interest in, or other right with respect to, the Indenture
Estate upon the payment of principal of, Make-Whole Amount, if any, and interest
on, any Secured Notes held by such Holder and all other sums payable to such
Holder hereunder and under such Secured Notes with respect to any such Secured
Notes.

          SECTION 2.10.  Equally and Ratably Secured. Except as otherwise
expressly provided in this Indenture, all Secured Notes at any time Outstanding
under this Indenture shall be equally and ratably secured by this Indenture
without preference, priority or distinction on account of the designation, date,
time of issue or maturity of such Secured Notes. All Additional Notes at any
time Outstanding under this Indenture shall be equally and ratably secured by
this Indenture without preference, priority or distinction on account of the
designation date, time of issue or maturity of such Additional Notes.

          SECTION 2.11.  CUSIP or CINS Numbers. The Grantor Trustee in issuing
the Secured Notes may use "CUSIP" or CINS numbers (if then generally in use),
and, if so, the Indenture Trustee shall use "CUSIP" or CINS numbers, as the case
may be, in notices of redemption as a convenience to Holders; provided that any
such notice may state that no representation is made as to the correctness of
such numbers either as printed on the Secured Notes or as contained in any
notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Secured Notes, and any such redemption
shall not be affected by any defect in or omission of

                                       13
<PAGE>

such numbers. The Grantor Trustee will promptly notify the Indenture Trustee of
any change in the CUSIP and CINS numbers.

                                  ARTICLE III

                           REDEMPTION AND REFUNDING

          SECTION 3.01.  Generally. The Secured Notes may not be redeemed or
prepaid except to the extent and in the manner expressly permitted or required
by this Indenture. Except as otherwise expressly provided in this Indenture, any
amount prepaid in partial redemption of the Secured Notes Outstanding shall be
distributed by the Indenture Trustee to all Holders ratably, without priority of
any Holder over any other Holder, in the proportion that the principal amount of
Secured Notes held by such Holder bears to the principal amount of all Secured
Notes then Outstanding.

          SECTION 3.02.  Mandatory Redemption. (a) Casualty Redemption. If an
Event of Loss pursuant to Section 12 of the Lease shall occur as to which a
Stipulated Loss Value payment is due under such Section 12, then the Grantor
Trustee shall redeem the Secured Notes Outstanding, without the Make-Whole
Amount or any other premium, on the date on which such Stipulated Loss Value is
paid by the Lessee pursuant to the Lease (the date of any such redemption
hereunder being a "Casualty Redemption Date"), as follows: (i) if an Event of
Loss described in Section 12.2(a) of the Lease shall have occurred and a
Stipulated Loss Value payment is due and owing under the Lease, the entire
unpaid principal amount of the Secured Notes Outstanding on such Casualty
Redemption Date shall be redeemed at a redemption price equal to 100% of the
unpaid principal amount of such Secured Notes, together with any accrued and
unpaid interest thereon to such Casualty Redemption Date; and (ii) if an Event
of Loss described in Section 12.2(b) of the Lease and a Stipulated Loss Value
payment for less than the full Undivided Interest is due and owing under the
Lease, such of the unpaid principal amount of the Secured Notes Outstanding on
such Casualty Redemption Date (assuming, only for purposes of this calculation,
that if such Casualty Redemption Date is coincident with an Installment Payment
Date or a Maturity Date, the scheduled principal payment due, if any, on such
Casualty Redemption Date on the Secured Notes is paid prior to the time the
Redemption Price is calculated pursuant to this Section 3.02(a)(ii) and applied
to principal in accordance with Section 4.01) as shall be equal to the product
of (x) the entire unpaid principal amount of the Secured Notes Outstanding on
such Casualty Redemption Date (assuming, only for purposes of this calculation,
that if such Casualty Redemption Date is coincident with an Installment Payment
Date or a Maturity Date, the scheduled principal payment due, if any, on such
Casualty Redemption Date on the Secured Notes is paid prior to the time the
Redemption Price is calculated pursuant to this Section 3.02(a)(ii) and applied
to principal in accordance with Section 4.01) and (y) a fraction, the numerator
of which

                                       14
<PAGE>

shall be the Original Cost of the Significant Portion of the Undivided Interest
suffering such Event of Loss and the denominator of which shall be Lessor's
Cost), at a redemption price equal to 100% of such unpaid principal amount of
the Secured Notes to be redeemed on such Casualty Redemption Date pursuant to
the terms of this Section 3.02(a)(ii), together with any accrued and unpaid
interest thereon to such Casualty Redemption Date (assuming, only for purposes
of this calculation, that if such Casualty Redemption Date is coincident with an
Interest Payment Date, the interest due on such Interest Payment Date is paid
prior to the time the Redemption Price is calculated pursuant to this Section
3.02(a)(ii) and applied to interest in accordance with Section 4.01); provided
that each Holder of a Secured Note shall receive, as to the principal thereof,
the same portion of such Redemption Price in its entirety as the principal value
of such Secured Note at such Casualty Redemption Date represents of the total
value of the principal value of all Secured Notes at such Casualty Redemption
Date.

          (b)  Early Termination Redemption. In the event that the Lease is
terminated with respect to the Undivided Interest or a Significant Portion
thereof pursuant to Section 7 of the Lease, the Grantor Trustee shall redeem on
the applicable Termination Date (the date of any redemption under this Section
3.02(b) being herein called a "Termination Redemption Date") (i) if the
termination is with respect to the Undivided Interest, the entire unpaid
principal amount of the Secured Notes Outstanding on such Termination Redemption
Date, at a redemption price equal to 100% of such unpaid principal amount of
such Secured Notes, together with any accrued and unpaid interest thereon to
such Termination Redemption Date plus, in the event any of the Secured Notes is
redeemed prior to the Premium Termination Date applicable to such Secured Note,
a premium, equal to the Make-Whole Amount, if any, with respect to such Secured
Note and otherwise without premium and (ii) if the termination is with respect
to a Significant Portion of the Undivided Interest, such of the unpaid principal
amount of the Secured Notes Outstanding on such Termination Redemption Date
(assuming, only for purposes of this calculation, that if such Termination
Redemption Date is coincident with an Installment Payment Date or a Maturity
Date, the scheduled principal payment due, if any, on such Termination
Redemption Date on the Secured Notes is paid prior to the time the Redemption
Price is calculated pursuant to this Section 3.02(b)(ii) and applied to
principal in accordance with Section 4.01) as shall be equal to the product of
(x) the entire unpaid principal amount of the Secured Notes Outstanding on such
Termination Redemption Date (assuming, only for purposes of this calculation,
that if such Termination Redemption Date is coincident with an Installment
Payment Date or a Maturity Date, the scheduled principal payment due, if any, on
such Termination Redemption Date on the Secured Notes is paid prior to the time
the Redemption Price is calculated pursuant to this Section 3.02(b)(ii) and
applied to principal in accordance with Section 4.01) and (y) a fraction, the
numerator of which shall be the Original Cost of such Significant Portion and
the denominator of which shall be Lessor's Cost, at a redemption price equal to
100% of the unpaid principal amount of the Secured Notes

                                       15
<PAGE>

to be redeemed on such Termination Redemption Date pursuant to the terms of this
Section 3.02(a)(ii), together with any accrued and unpaid interest thereon to
such Termination Redemption Date (assuming, only for purposes of this
calculation, that if such Termination Redemption Date is coincident with an
Interest Payment Date, the interest due on such Interest Payment Date is paid
prior to the time the Redemption Price is calculated pursuant to this Section
3.02(b)(ii) and applied to interest in accordance with Section 4.01) plus, in
the case of a redemption pursuant to this Section 3.02(b)(ii) prior to the
Premium Termination Date applicable to such Secured Note, a premium, equal to
the Make-Whole Amount, if any, with respect to the portion of such Secured Note
which is to be so redeemed and otherwise without premium; provided that each
Holder of a Secured Note shall receive, as to the principal thereof, the same
portion of such Redemption Price in its entirety as the principal value of such
Secured Note at such Casualty Redemption Date represents of the total value of
the principal value of all Secured Notes at such Termination Redemption Date.

          (c)  Purchase Redemption. (i) In the event that the Lessee shall
purchase the Lessor's Interest in the Undivided Interest pursuant to Section
6.1(c), 6.1(d), 6.1(e) or 6.1(f) of the Lease prior to the date of expiration of
the Basic Lease Term, and the Lessee shall not have assumed the obligations of
the Grantor Trustee under the Secured Notes pursuant to Section 11.6 of the
Participation Agreement or purchased the Lessor's Interest in the Undivided
Interest pursuant to Sections 16.1 and l6.2 of the Participation Agreement, the
Grantor Trustee shall redeem on the date of purchase (the date of any redemption
under this Section 3.02(c) being herein called a "Purchase Redemption Date"),
the entire unpaid principal of the Secured Notes Outstanding on such Purchase
Redemption Date at a redemption price equal to 100% of the unpaid principal
amount of the Secured Notes together with any accrued and unpaid interest
thereon to such Purchase Redemption Date plus, in the case of each Secured Note
redeemed prior to the Premium Termination Date applicable to such Secured Note,
a premium equal to the Make-Whole Amount, if any, with respect to such Secured
Note and otherwise without premium.

          (d)  Special Redemption. If the Grantor Trustee or the Owner
Participant has drawn on the Letter of Credit (or any other letter of credit
naming the Lessor and/or the Owner Participant as a beneficiary as contemplated
by Section 10.14 of the Participation Agreement) or received payment under the
Surety Bond (or any other surety bond held by the Lessor and/or the Owner
Participant as contemplated by Section 10.14 of the Participation Agreement),
and the Lessee shall not have assumed the obligations of the Grantor Trustee
under the Secured Notes pursuant to Section 11.6 of the Participation Agreement,
then the Grantor Trustee shall redeem the Secured Notes Outstanding, on the date
on which the remaining portion of Stipulated Loss Value is required to be paid
by the Lessee pursuant to the Lease (the date of any such redemption hereunder
being a "Special Redemption Date"), at a redemption price equal to 100% of the
unpaid principal amount of such Secured Notes, together with any

                                       16
<PAGE>

accrued and unpaid interest thereon to such Special Redemption Date but without
the Make-Whole Amount or any other premium.

          SECTION 3.03.  [Intentionally Omitted].

          SECTION 3.04.  Assumption of Obligations of the Grantor Trustee by the
Lessee. In the event that the Lessee shall have elected to assume all of the
rights and obligations of the Grantor Trustee under this Indenture in respect of
the Secured Notes in connection with the purchase by the Lessee of the Lessor's
Interest in the Undivided Interest pursuant to Section 6.1(c), (d), (e), (f) or
(g) of the Lease or pursuant to Section 16.2(d) of the Participation Agreement
(the date of any such assumption being referred to hereinafter as the "Relevant
Date") and, if on or prior to the Relevant Date:

          (a)  the Lessee shall have delivered to the Indenture Trustee an
     Officer's Certificate of the Lessee, dated the Relevant Date, stating that
     the Lessee has paid to the Grantor Trustee all amounts required to be paid
     to the Grantor Trustee pursuant to the Lease, in connection with such
     purchase or termination and assumption;

          (b)  no Indenture Event of Default after giving effect to the Relevant
     Amendment (as defined below) shall have occurred and be continuing
     immediately subsequent to such purchase or termination, or assumption and
     the Indenture Trustee shall have received an Officer's Certificate, dated
     the Relevant Date, of the Lessee to such effect;

          (c)  the Indenture Trustee shall have received a (i) supplement to
     this Indenture, substantially in the form of Exhibit E (the "Relevant Date
     Supplement"), duly executed by the Lessee, which shall provide that the
     Lessee agrees that it is acquiring, subject to the security interest and
     Lien thereon granted to the Indenture Trustee under this Indenture and the
     Ship Mortgage, all of Lessor's right, title and interest in and to the
     Undivided Interest, as provided in Section 2 of the form of Relevant Date
     Supplement attached as Exhibit E and (ii) a ship mortgage, substantially in
     the form attached as Exhibit G (the "New Ship Mortgage");

          (d)  the Indenture Trustee shall have received, on or prior to the
     Relevant Date, evidence of all filings, recordings and other action
     referred to in the opinion of counsel referred to below; and

          (e)  the Indenture Trustee shall have received opinions of counsel as
     are customary for transactions of this type, subject to usual or customary
     qualifications, exceptions and assumptions, and shall include opinions,
     subject to such qualifications, exceptions and assumptions, to the effect
     that, after giving effect to the

                                       17
<PAGE>

     Relevant Amendment (as defined below):

      (i)  on the Relevant Date, this Indenture, as supplemented by the Relevant
     Date Supplement and as amended by the Relevant Amendment and the Secured
     Notes issued thereunder constitute the legal, valid and binding obligations
     of the Lessee, enforceable against the Lessee in accordance with their
     terms, except as the same may be limited by applicable bankruptcy,
     insolvency, reorganization, moratorium or similar laws affecting the rights
     of creditors generally and by general principles of equity, and except as
     limited by applicable laws which may affect the remedies provided for in
     this Indenture as so supplemented, which laws, however, do not in the
     opinion of such counsel make the remedies provided for in this Indenture
     inadequate for the practical realization of the rights and benefits
     provided for in this Indenture as so supplemented; and

      (ii) the Liens of this Indenture on the Undivided Interest and the New
     Ship Mortgage have been perfected and creates a security interest in the
     Indenture Estate and all filings and recordings and other action necessary
     or appropriate to perfect the interests of the Indenture Trustee have been
     accomplished;

then, simultaneously with the delivery of such documents, the Indenture Trustee
shall execute and deliver the Relevant Date Supplement, and automatically and
without the requirement of further action by any person, effective as of the
Relevant Date:

          (x)  this Indenture shall be deemed to have been amended as provided
     for in Exhibit C hereto (the "Relevant Amendment"); and

          (y)  the Grantor Trustee shall be released from all of its obligations
     under this Indenture in respect of the Secured Notes or otherwise (other
     than any obligations or liabilities of the Grantor Trustee in its or his
     individual capacity incurred on or prior to the Relevant Date or arising
     out of or based upon events occurring on or prior to the Relevant Date,
     which obligations and liabilities shall remain the sole responsibility of
     the Grantor Trustee) and there shall be immediately distributed any funds
     then being retained hereunder that are distributable to the Grantor Trustee
     or the Owner Participant.

          SECTION 3.05.  Refunding. (a) Subject to the terms and conditions of
Section 15 of the Participation Agreement, the Grantor Trustee from time to time
may after January 2, 2001, take such steps as may be necessary to refund or
refinance in whole all Outstanding Secured Notes at the redemption price equal
to 100% of the unpaid principal amount of the Secured Notes to be redeemed
pursuant to this Section 3.05, together with any accrued and unpaid interest
thereon to the date of redemption plus, in the case of a redemption prior to the
Premium

                                       18
<PAGE>

Termination Date applicable to such Secured Notes, a premium equal to the Make-
Whole Amount, if any, with respect to such Secured Notes and otherwise without
premium.

          (b)  The terms, conditions and designations of any such Refunding
Secured Notes (to the extent not inconsistent with this Indenture) shall be set
forth in a supplement to this Indenture reasonably satisfactory to the Indenture
Trustee and the Grantor Trustee (a "Refunding Indenture") which shall be
executed by the Grantor Trustee and the Indenture Trustee.

          (c)  The Corporate Indenture Trustee shall authenticate and deliver
Refunding Secured Notes in accordance with the provisions of any Refunding
Indenture upon receipt by the Indenture Trustee of the following:

             (i)  a counterpart of the applicable Refunding Indenture duly
     executed by the Grantor Trustee; and

             (ii) any opinions, certificates or additional documents as
     reasonably shall be required to be delivered to or deposited with the
     Indenture Trustee by the applicable Refunding Indenture, Section 15 of the
     Participation Agreement or for transactions of this type.

          SECTION 3.06.  Grantor Trustee's and Owner Participant's Option to
Redeem or Purchase Secured Notes. In the event that (a) at any time one or more
Lease Events of Default shall have occurred and any such Lease Event of Default
shall have continued for a period of less than 270 days, during which time the
Secured Notes could but shall not have been accelerated pursuant to Section
5.04, or (b)(i) the Indenture Trustee has given the Grantor Trustee or the Owner
Participant notice of the intent to accelerate the Secured Notes pursuant to
Section 5.04, (ii) the Secured Notes shall have been accelerated pursuant to
Section 5.04 but not yet paid or (iii) at any time one or more Lease Events of
Default shall have occurred and any such Lease Event of Default shall have
continued for a period of 270 days or more during which time the Secured Notes
could, but shall not have been, accelerated pursuant to Section 5.04, the
Grantor Trustee or the Owner Participant may, at its option, give at least 30
days' prior irrevocable notice to the Indenture Trustee that it will redeem (or
purchase in lieu of redemption) all Secured Notes then Outstanding, which
redemption or purchase shall be at a redemption or purchase price equal to 100%
of the unpaid principal amount of such Secured Notes, together with any accrued
and unpaid interest thereon, plus in the case of any redemption or purchase
pursuant to clause (a) above prior to the applicable Premium Termination Date a
premium equal to the Make-Whole Amount, if any, with respect to such Secured
Notes but otherwise without premium. On or prior to the Business Day preceding
the Redemption Date set forth in the notice, the Grantor Trustee or the Owner
Participant will deposit with the Indenture Trustee an amount sufficient

                                       19
<PAGE>

to redeem or purchase at the applicable Redemption Price all Secured Notes then
Outstanding (including, in the case of a redemption or purchase pursuant to
clause (a) above, a good faith estimate of the premium computed as provided for
herein) plus an amount equal to all other sums then due and payable to a Loan
Participant hereunder, and to pay the Indenture Trustee all amounts then due it
hereunder, which funds shall be held by the Indenture Trustee as provided in
Section 7.04. Upon the giving of such notice and the receipt by the Indenture
Trustee of such deposit, the Indenture Trustee shall deem all instructions
received from the Grantor Trustee or the Owner Participant as having been given
by the Loan Participants of 100% of the Outstanding principal amount of Secured
Notes for all purposes of this Indenture. If such notice is given, the Grantor
Trustee further agrees that it will deposit or cause to be deposited with the
Indenture Trustee, on or prior to the Business Day preceding the applicable
Redemption Date, whether or not an Indenture Event of Default is then
continuing, funds sufficient, when added to the funds already held by the
Indenture Trustee for such purpose, to redeem or purchase at the applicable
Redemption Price (including the premium actually payable in respect thereof
computed as provided for herein), on such Redemption Date all Secured Notes then
Outstanding, to pay all other sums then due and payable to a Loan Participant
hereunder and to pay the Indenture Trustee all amounts then due it hereunder. In
the event the Grantor Trustee shall have given any such notice to purchase or
redeem, unless the Grantor Trustee shall have consented thereto, the Indenture
Trustee shall not during the period from such notice to the Redemption Date
specified therein institute any new remedy or proceeding in respect of any new
remedy under this Indenture, and the Indenture Trustee shall, to the extent the
same may be accomplished without prejudicing the rights of the Indenture Trustee
hereunder, take such actions and forbear from taking actions, in each case
sufficient to maintain the status quo with respect to any pending remedies or
proceedings in respect thereof being then pursued hereunder; provided, however,
that in no event shall the Indenture Trustee sell or assign any portion of the
Indenture Estate during the period from such notice to the Redemption Date
specified therein. In the event the Grantor Trustee shall have given any such
notice to purchase or redeem, and the Grantor Trustee has deposited with the
Indenture Trustee the amounts required to be deposited pursuant to this Section
3.06, then on the Redemption Date, each Loan Participant will be deemed to sell,
assign, transfer and convey to the Grantor Trustee or its designee (without
recourse or warranty of any kind other than of title to the Secured Notes so
conveyed) all of the right, title and interest of such Loan Participant in and
to the Secured Note held by such Loan Participant. On and after such Redemption
Date and receipt of amounts required to be deposited pursuant to this Section
3.06, the Indenture Trustee shall no longer treat the former Loan Participants
as the "Loan Participants", except for purposes of the Loan Participants' right
to receive their respective portions of the amounts paid to the Indenture
Trustee as aforesaid and all other amounts due to such Loan Participants
hereunder and, to the extent secured hereby, under the Operative Documents with
respect to acts, events, circumstances or conditions occurring or existing prior
to such Redemption Date, and on

                                       20
<PAGE>

such date the Corporate Indenture Trustee shall register the transfer of
ownership of the Secured Notes into the name of the Grantor Trustee or its
designee. If the Grantor Trustee elects to purchase the Secured Notes under this
Section 3.06, nothing herein, including the use of the terms "Redemption Date"
and "Redemption Price," shall be deemed to result in a redemption of the Secured
Notes.

          SECTION 3.07.  Deposited Redemption or Purchase Moneys. Moneys held by
the Indenture Trustee for the redemption or purchase of any Secured Note issued
hereunder as provided in this Article III shall be held by the Indenture Trustee
as a separate fund in trust for the account of the respective Holders of the
Secured Notes to be redeemed, shall be invested in accordance with the
provisions of Section 7.04 and shall be delivered to them respectively in
accordance with Section 2.03 on the Redemption Date. Any amounts so held by the
Indenture Trustee shall be deemed paid for purposes of Section 2.09, of all
amounts of principal of, Make-Whole Amount, if any, and interest on, and all
other amounts due and payable under any such Secured Notes, the Holders thereof
shall be paid to such Holder's agent upon delivery of such Secured Notes to the
Indenture Trustee for cancellation.

          SECTION 3.08.  Acquisition of Secured Notes. The Grantor Trustee
covenants that it will not, directly or indirectly, acquire or make any offer to
acquire any Secured Note except pursuant to the provisions of this Indenture.

          SECTION 3.09.  Condition to Redemption and Refunding. It shall be a
condition to any redemption, refinancing or refunding of Secured Notes effected
under this Article III other than under Section 3.06 that all amounts of
principal of, Make-Whole Amount, if any, and interest on, and all other amounts
then due and payable under the Secured Notes which are to be the subject of such
redemption, refinancing or refunding, as the case may be, as well as all other
amounts due and payable to the Holders of such Secured Notes as are to be the
subject of such redemption, refinancing or refunding shall have been paid as
specified herein or therein or in any other Operative Document.

          SECTION 3.10.  Notice of Certain Redemptions. In connection with a
redemption of any of the Secured Notes pursuant to Section 3.02 or Section 3.05,
the Grantor Trustee shall give irrevocable (except with respect to redemption
notices given pursuant to Section 3.02(b) which may be withdrawn) notice of such
redemption at least 25 days and not more than 60 days prior to the Redemption
Date to each Loan Participant of such Secured Notes to be redeemed, at such Loan
Participant's address appearing in the Note Register.

          Any such notice of redemption shall state (including the CUSIP or CINS
number, if any):

             (i)   the Redemption Date (which shall be a Stipulated

                                       21
<PAGE>

     Loss Value Determination Date;

             (ii)  the applicable basis for determining the redemption price
     pursuant to Section 3.02 or Section 3.05 (the "Redemption Price");

             (iii) that on the Redemption Date, the Redemption Price will
     become due and payable upon each such Secured Note, and that, if any such
     Secured Notes are then Outstanding, interest on such Secured Notes shall
     cease to accrue on and after such Redemption Date; and

             (iv)  the place or places where such Secured Notes are to be
     surrendered for payment of the Redemption Price.

          SECTION 3.11.  Termination of Head Lease. The Grantor Trustee shall
notify the Indenture Trustee in writing at least 5 days before exercising its
option to purchase the Undivided Interest pursuant to Section 10.2 of the Head
Lease. With such notice the Grantor Trustee shall deliver to the Indenture
Trustee:

          (a) a ship mortgage substantially in the form of the Ship Mortgage but
     securing the Indenture Indebtedness rather than the obligations of the
     Lessee under the Head Lease (the "Direct Ship Mortgage");

          (b) on or prior to the Relevant Date, evidence of all filings,
     recordings and other action referred to in the opinion of counsel referred
     to below; and

          (c) opinions of counsel as are customary for transactions of this
     type, subject to usual or customary qualifications, exceptions and
     assumptions, and shall include opinions, subject to such qualifications,
     exceptions and assumptions, to the effect that, after giving effect to the
     execution and delivery of the Ship Mortgage and any necessary filings,
     recordings and other actions that:

     (i) the Direct Ship Mortgage constitutes the legal, valid and binding
     obligation of the Grantor Trustee, enforceable against the Grantor Trustee
     in accordance with its terms, except as the same may be limited by
     applicable bankruptcy, insolvency, reorganization, moratorium or similar
     laws affecting the rights of creditors generally and by general principles
     of equity, and except as limited by applicable laws which may affect the
     remedies provided for in the Direct Ship Mortgage, which laws, however, do
     not in the opinion of such counsel make the remedies provided for in the
     Direct Ship Mortgage inadequate for the practical realization of the rights
     and benefits provided for in the Direct Ship Mortgage; and

                                       22
<PAGE>

     (ii) the Direct Ship Mortgage has been filed and creates a valid lien in
     the Platform and other property described therein and all filings and
     recordings and other action necessary or appropriate to make such lien
     valid against third parties have been accomplished.

                                  ARTICLE IV

   RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME FROM THE INDENTURE ESTATE

          SECTION 4.01.  Basic Rent Distribution. (a) Generally. Except as
otherwise provided in Sections 4.01(c) and 4.03, each installment of Basic Rent
(other than any portion thereof constituting an Excepted Payment), any payment
of Supplemental Rent representing interest on overdue installments of Basic Rent
(other than any portion thereof constituting an Excepted Payment) and any
payment received by the Indenture Trustee as contemplated by Section 5.03 shall
be promptly distributed by the Indenture Trustee on the date such payment is due
from the Lessee (or as soon thereafter as such payment shall be received by the
Indenture Trustee) in the following order of priority:

          first, in accordance with Section 4.04, so much of such installment or
     payment as shall be required to pay in full the aggregate amount of the
     payment or repayment of principal, interest and other amounts then due
     under all Secured Notes shall be distributed to the Holders of such Secured
     Notes ratably, without priority of one Holder over any other Holder, in the
     proportion that the amount of such payment or payments then due under each
     such Secured Note bears to the aggregate amount of the payments then due
     under all such Secured Notes; and

          second, subject to Section 4.01(c), the balance, if any, of such
     installment remaining thereafter shall be distributed to the Grantor
     Trustee for distribution pursuant to the Trust Agreement.

          (b)  Application of Certain Amounts Held by the Indenture Trustee upon
Certain Defaults. If as a result of any default by the Lessee in the performance
of its obligations under any Operative Document, the Indenture Trustee shall not
have received for distribution on any Basic Rent Payment Date (or the Indenture
Trustee shall be prevented from distributing on such date) the full amount then
distributable pursuant to clause "first" of Section 4.01(a), the Indenture
Trustee shall distribute any Rent, any proceeds of the Indenture Estate, and
amounts described in Section 12.5 of the Lease then held by it or thereafter
received by it (and any earnings thereon that constitute part of the Indenture
Estate as provided in Section 7.04) to the Holders to the extent necessary to
make all distributions then due pursuant to such clause "first".

                                       23
<PAGE>

          (c)  Retention of Amounts by the Indenture Trustee. If, at the time of
receipt by the Indenture Trustee of an installment of Basic Rent (whether or not
then overdue) or of payment of Supplemental Rent representing interest on any
overdue installment of Basic Rent, the Indenture Trustee shall have Actual
Knowledge that there shall have occurred and be continuing an Indenture Event of
Default, the Indenture Trustee shall retain and not distribute any amount
otherwise required to be distributed pursuant to clause "second" of Section
4.01(a), and (i) at such time as there shall not be continuing any Indenture
Event of Default or (ii) on the first Business Day occurring more than 180 days
after the receipt of such amount, whichever shall first occur, the Indenture
Trustee shall distribute such amount pursuant to clause "second" of Section
4.01(a) unless prior thereto (1) the Indenture Trustee (as assignee of the
Grantor Trustee) shall have given notice to declare the Lease to be in default
in accordance with Section 16.1 thereof, (2) the Indenture Trustee shall have
given notice to the Grantor Trustee pursuant to the first proviso to Section
5.04(a) of the Indenture Trustee's intent to declare the Secured Notes due and
payable or (3) any of the Secured Notes shall have been declared or otherwise
shall have become immediately due and payable pursuant to Section 5.04, in which
case such amount shall be distributed by the Indenture Trustee forthwith in
accordance with the terms of Section 4.03.

          SECTION 4.02.  Certain Distributions. (a) Any payment received by the
Indenture Trustee (i) pursuant to Section 12 of the Lease as a result of the
occurrence of an Event of Loss, with respect to the Undivided Interest or a
Significant Portion thereof, (ii) pursuant to Section 6 of the Lease as a result
of the sale of the Lessor's right, title and interest in the Undivided Interest,
(iii) upon the termination of the Lease with respect to the Undivided Interest
or a Significant Portion thereof pursuant to Section 7 of the Lease, (iv) in
connection with the refunding of the Secured Notes pursuant to Section 3.05, or
(v) in connection with any drawing on a letter of credit or payment on a surety
bond maintained pursuant to Section 4.02 of the Participation Agreement shall be
distributed forthwith in the following order of priority:

          first, in the manner provided in clause "first" of Section 4.03;

          second, in the manner provided in clause "third" of Section 4.03 but
     only with respect to those Secured Notes to be redeemed pursuant to Section
     3.02 as a result of such Event of Loss, sale, termination, drawing or
     payment, as the case may be;

          third, in the manner provided in clause "second" of Section 4.03;

          fourth, in the manner provided in clause "fourth" of Section 4.03; and

                                       24
<PAGE>

          fifth, in the manner provided in clause "fifth" of Section 4.03.

          (b)  The portion of each payment referred to in this Section 4.02
distributed to a Holder on account of principal, interest or the Make-Whole
Amount, if any, on any Secured Note held by such Holder shall be applied by such
Holder in payment of such Secured Note in accordance with the terms of Section
4.04.

          SECTION 4.03.  Distributions After Indenture Event of Default. If (a)
an Indenture Event of Default shall have occurred and be continuing, and (b)(i)
the Indenture Trustee (as assignee of the Grantor Trustee) shall have given
notice to declare the Lease to be in default pursuant to Section 16.1 thereof,
(ii) the Indenture Trustee shall have given notice to the Grantor Trustee
pursuant to the first proviso to Section 5.04(a) of the Indenture Trustee's
intent to declare the Secured Notes due and payable or (iii) any of the Secured
Notes shall have been declared or otherwise shall have become immediately due
and payable pursuant to Section 5.04, then, to the extent that each such notice
or declaration shall not have been rescinded or the Secured Notes shall remain
immediately due and payable, (i)(A) all amounts (other than Excepted Payments)
then held by the Indenture Trustee in accordance with Section 4.05 or 4.06 (in
each case not excluded from the operation of this Section 4.03), (B) then
otherwise held by the Indenture Trustee hereunder or (C) under any Operative
Document (other than amounts held for its own account) (and, in each case, all
earnings thereon that constitute part of the Indenture Estate as provided in
Section 7.04), and (ii) all payments and amounts thereafter realized by the
Indenture Trustee through the exercise of remedies hereunder or under any of the
agreements assigned or pledged to the Indenture Trustee under this Indenture or
otherwise as trustee under this Indenture (for purposes of this Section 4.03,
all such amounts and payments held or realized being herein called "proceeds"),
other than amounts expressly paid to it for its own account and other than
Excepted Payments, shall be distributed forthwith by the Indenture Trustee as
provided in the next sentence; provided, however, in the event of an Indenture
                               --------  -------
Event of Default that is not a Lease Event of Default, any amounts held by the
Indenture Trustee hereunder or under any Operative Document on behalf of or in
trust for the Lessee, shall not, until and unless such amounts are applied
against the Lessee's payment obligations under the Lease, be subject to
distribution under Section 4.03. Distributions shall be made in the following
order of priority:

          first, so much of such proceeds as shall be required to reimburse the
     Indenture Trustee for any unpaid fees for its services under this Indenture
     and any unreimbursed tax, expense (including reasonable legal fees) or
     other loss incurred by it (in each case to the extent reimbursable under
     the Operative Documents) shall be distributed to the Indenture Trustee for
     application to itself;

                                       25
<PAGE>

          second, so much of the remaining proceeds as shall be required to
     reimburse the then existing or prior Holders for amounts paid or advanced
     by the Holders pursuant to Section 6.04 (to the extent not previously
     reimbursed), shall be distributed to the then existing and prior Holders as
     their respective interests may appear, and if the proceeds remaining are
     insufficient to pay all such amounts in full, they shall be distributed
     ratably, without priority of any recipient over any other recipient (except
     as otherwise expressly provided herein), in the proportion the aggregate
     amount due each such Person under this clause "second" bears to the
     aggregate amount and interest due all such Persons under this clause
     "second";

          third, so much of the proceeds remaining as shall be required to pay
     in full the aggregate unpaid principal amount of each Secured Note then
     Outstanding and Make-Whole Amount, if any, and all accrued but unpaid
     interest thereon to the date of distribution, shall be distributed to the
     Holder of such Secured Note, and if the proceeds remaining are insufficient
     to pay all such amounts in full, they shall be distributed to all Holders
     ratably, without priority of any Holder over any other Holder (except as
     otherwise expressly provided herein), in the proportion that the aggregate
     amount due each such Holder under this clause "third" bears to the
     aggregate amount due all such Holders under this clause "third";

          fourth, so much of the proceeds remaining as shall be required to pay
     to each Holder all other amounts that are secured hereby, that remain
     unpaid and that are payable pursuant to any provision of any Operative
     Document shall be distributed to such Holder for distribution to itself and
     its predecessors, as their respective interests may appear, and if the
     proceeds remaining are insufficient to pay all such amounts in full, they
     shall be distributed ratably, without priority of any Holder over any other
     Holder (except as otherwise expressly provided herein), in the proportion
     that the aggregate amount due each such Holder under this clause "fourth"
     bears to the aggregate amount due all such Holders under this clause
     "fourth"; and

          fifth, the balance, if any, of the proceeds remaining shall be
     distributed to the Grantor Trustee for distribution pursuant to the Trust
     Agreement.

          All amounts distributed to any Holder pursuant to clause "third" of
this Section 4.03 shall be applied by such Holder in payment of the Secured
Notes held by it in accordance with the terms of Section 4.04.

          SECTION 4.04.  Application of Payments on Secured Notes. Each payment
on a Secured Note shall be applied, first, to the payment of accrued interest on
such Secured Note to the date of such payment,

                                       26
<PAGE>

second, to the payment of Make-Whole Amount, if any, on such Secured Note due on
the date of such payment, third, to the payment of any principal on such Secured
Note then due thereunder, and fourth, to the payment of the installments of
principal remaining unpaid on such Secured Note in the inverse order of the
installment due date thereof.

          SECTION 4.05.  Application of Payments According to Applicable
Operative Document Provisions. (a) Any payments or amounts (other than Excepted
Payments) received by the Indenture Trustee, provision for the application of
which is made in any Operative Document (including, without limitation, any
provision providing that the Indenture Trustee shall hold such amount in trust
for the Lessee), shall be applied promptly as provided in such Operative
Document, unless (i) in the case of payments or amounts that would be payable to
the Lessee upon satisfaction of any applicable conditions, a Lease Event of
Default shall have occurred and be continuing at the time the Indenture Trustee
receives such payment and the Indenture Trustee has Actual Knowledge of such
Lease Event of Default, in which case the Indenture Trustee shall hold such
payments and amounts as cash collateral security for the obligations of the
Lessee under the Operative Documents and shall invest such payments and amounts
in accordance with the terms of Section 7.04, and, subject to earlier
distribution thereof by the Indenture Trustee under Section 4.03 if the Lease
shall have been declared in default in accordance with Section 16.1 thereof, or
under Section 4.01(b) (subject to Section 4.05(b)), such payments and amounts,
and the proceeds of any investment thereof, shall be paid by the Indenture
Trustee to the Lessee at such time as any applicable conditions shall have been
satisfied and no Lease Event of Default shall be continuing, and (ii) in the
case of any other payments and amounts that are not payable to the Lessee upon
satisfaction of any applicable conditions in the other Operative Documents, an
Indenture Event of Default shall have occurred and be continuing at the time the
Indenture Trustee receives such payment and the Indenture Trustee has Actual
Knowledge of such Indenture Event of Default, in which case the Indenture
Trustee shall hold such payment as part of the Indenture Estate, as cash
collateral security hereunder for the performance of the Indenture Indebtedness
and on the earlier of the next Business Day on which no Indenture Event of
Default shall have occurred and be continuing or the first Business Day
occurring more than 180 days after the receipt of such payment, and, subject to
any prior application of such payment pursuant to Section 4.01(b) or 4.03, the
Indenture Trustee shall apply such payment, and the proceeds of any investment
thereof, to the purpose for which it was made.

          (b)  Notwithstanding any other provision of this Indenture to the
contrary, and whether or not any such provision refers to this Section 4.05, any
Excepted Payment or other amount expressly provided by the terms of this
Indenture to be paid directly to the Grantor Trustee or to the Owner Participant
shall be paid or distributed immediately by the Indenture Trustee to the Grantor
Trustee or the Owner Participant, as the case may be.

                                       27
<PAGE>

          SECTION 4.06.  Amounts Received for Which No Provision Is Made. (a)
Any payment received or amounts realized by the Indenture Trustee for which no
provision as to the application thereof is made elsewhere in this Indenture or
any other Operative Document shall be held by the Indenture Trustee as part of
the Indenture Estate in a cash collateral account maintained under Section 7.04,
and (b) all payments received and amounts realized by the Indenture Trustee
under the Lease, including without limitation, Section 11.7(b) of the Lease, or
otherwise with respect to the Undivided Interest, to the extent received or
realized at any time after payment in full of the principal of and interest on
all Secured Notes issued hereunder, as well as any other amounts remaining as
part of or as proceeds of the Indenture Estate after payment in full of the
principal of, Make-Whole Amount, if any, and interest on all such Secured Notes,
shall be distributed forthwith by the Indenture Trustee in the order of priority
set forth in Section 4.03, omitting clause "third" thereof. The Indenture
Trustee shall give prompt notice to the Grantor Trustee and each Holder of the
receipt of any moneys by the Indenture Trustee subject to the provisions of this
Section 4.06.

          SECTION 4.07.  Payment Procedures. All amounts which are distributable
from time to time by the Indenture Trustee to the Grantor Trustee, the Owner
Participant or any Holder shall be paid by the Indenture Trustee in immediately
available funds promptly after such amounts become immediately available to it,
and the Indenture Trustee shall not be obligated to see to the application of
any such payment made by it. All payments made by the Indenture Trustee to the
Owner Participant or to the Grantor Trustee shall be made in the manner and to
the address set forth in Schedule 1 to the Participation Agreement or to such
other address as may be specified from time to time by notice to the Indenture
Trustee from the Owner Participant or the Grantor Trustee.

                                   ARTICLE V

COVENANTS OF GRANTOR TRUSTEE; CERTAIN AGREEMENTS; INDENTURE EVENTS OF DEFAULT;
                         REMEDIES OF INDENTURE TRUSTEE

          SECTION 5.01.  Covenants of Grantor Trustee; Certain Agreements. (a)
Subject to Section 2.02, the Grantor Trustee will duly and punctually perform
and observe all covenants and conditions to be performed and observed by it
pursuant to the terms of any Operative Document. Except as permitted by this
Indenture or the terms of any Operative Document, the Grantor Trustee will take
no action and will cooperate with the Indenture Trustee so as to permit no
action to be taken by others which will release, or which may be construed as
releasing, the Grantor Trustee or the Lessee from any of its or the Lessee's, as
the case may be, obligations or liabilities under any Operative Document, or
which may result in the termination, amendment or modification, or impair the
validity, of any such Operative Document.

                                       28
<PAGE>

          (b)  If the Grantor Trustee has Actual Knowledge of any Indenture
Event of Default, Indenture Default, Lease Event of Default or Event of Loss,
the Grantor Trustee will give prompt written notice thereof to the Indenture
Trustee, the Lessee and the Owner Participant if such notice shall not already
have been given to such party. The notice shall set forth in reasonable detail
the circumstances of such default or loss known to the Grantor Trustee.

          (c)  [Intentionally Omitted.]

          (d)  The Grantor Trustee does hereby warrant and represent that it has
not assigned or pledged, and hereby covenants that except as provided in or
permitted by the other Operative Documents it will not assign or pledge, so long
as this Indenture shall remain in effect, any of the Grantor Trustee's right,
title or interest hereby assigned to anyone other than the Indenture Trustee,
and that the Grantor Trustee will not (other than in respect of Excepted
Payments), except as provided in or permitted by this Indenture or any other
Operative Document, (i) accept any payment from the Lessee, (ii) terminate or
consent to the cancellation or surrender of the Lease or accept any prepayment
of Rent under the Lease, (iii) enter into any agreement amending or
supplementing any Operative Document, (iv) execute or grant any waiver or
modification of, or consent under, the terms of any Operative Document, (v)
settle or compromise any claim arising under any Operative Document, or (vi)
submit or consent to the submission of any dispute, difference or other matter
arising under or in respect of any Operative Document to arbitration thereunder.

          (e)  The Grantor Trustee does hereby ratify and confirm the Lease, and
does hereby agree that it will not, except as provided in or permitted by this
Indenture or the terms of any other Operative Document, take or omit to take any
action, the taking or omission of which might result in an alteration or
impairment of the Lease or any other Operative Document, or of any of the rights
created by the Lease or any Operative Document, or the assignment hereunder or
thereunder, as the case may be.

          (f)  The Corporate Grantor Trustee will, in its individual capacity
and at its own cost and expense, promptly take such action as may be necessary
to discharge any Lessor's Lien on any of the Grantor Trustee's estate, right,
title or interest in the Trust Estate (including the Louisiana Trust Estate as
defined in Section 8.03 hereof) so pledged or assigned or intended to be
conveyed, pledged or assigned under this Indenture.

          (g)  Until the release of the security interest in the Indenture
Estate pursuant to Section 6.03, all payments due or to become due under any
Operative Document to the Grantor Trustee that are part of the Indenture Estate
shall be made directly to the Indenture Trustee or in accordance with the
Indenture Trustee's instructions, and the Grantor Trustee shall give all notices
as shall be required under each Operative Document to direct that such payments
be made to the Indenture Trustee.

                                       29
<PAGE>

Promptly on receipt thereof, the Grantor Trustee will transfer to the Indenture
Trustee any and all moneys from time to time received by it and constituting
part of the Indenture Estate or otherwise assigned or pledged to the Indenture
Trustee hereunder, in each case for application by the Indenture Trustee
pursuant to this Indenture, except that the Grantor Trustee shall accept for
distribution pursuant to the terms of the Trust Agreement any amounts
distributed to it by the Indenture Trustee under this Indenture.

          (h)  An executed counterpart of each amendment or supplement to the
Trust Agreement shall be delivered within 20 Business Days after the execution
thereof to the Indenture Trustee, provided that any amendment or supplement
under which a successor trustee is appointed shall be mailed to the Indenture
Trustee within 10 days after the execution thereof. The Lien of this Indenture
or the Ship Mortgage shall not be affected by any amendment or supplement to the
Trust Agreement or by any other action taken under or in respect of the Trust
Agreement. Without the prior written consent of the Indenture Trustee, the Trust
Agreement may not in any event be terminated or revoked by the Owner Participant
prior to the termination of this Indenture. In the case of any appointment of a
successor to any Grantor Trustee pursuant to the Trust Agreement or any merger,
conversion, consolidation or transfer of all or substantially all of the
corporate trust business of the Corporate Grantor Trustee pursuant to the Trust
Agreement, the successor Grantor Trustee shall give prompt notice thereof to the
Indenture Trustee.

          SECTION 5.02.  Indenture Event of Default. "Indenture Event of
Default" means any of the following events (whatever the reason for such
Indenture Event of Default and whether such event shall be voluntary or
involuntary or come about or be effected by operation of law or pursuant to or
in compliance with any judgment, decree or order of any court or any
Governmental Rule):

          (a)  any Lease Event of Default (other than a Lease Event of Default
     arising from the failure of the Lessee to make an Excepted Payment) shall
     have occurred and be continuing; or

          (b)  any payment of principal of, Make-Whole Amount, if any, or
     interest on any Secured Note shall not have been made when due and such
     default shall continue unremedied for ten (10) Business Days after the same
     shall have become due and payable; or

          (c)  the failure by either of the Owner Participant or the Grantor
     Trustee, as the case may be, to perform or observe in any material respect
     any covenant or agreement to be performed or observed by it under this
     Indenture or any other Operative Document (other than the Tax Indemnity
     Agreement), (i) which failure shall continue for a period of thirty (30)
     days after the receipt by the Owner Participant or the Grantor Trustee of a
     notice from the Indenture Trustee or any Holder of a Secured Note
     specifying such

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<PAGE>

     failure and requiring it be remedied or (ii) which failure, if such failure
     is remediable and the Owner Participant or the Grantor Trustee is
     diligently attempting to remedy such failure, shall continue for a period
     of 180 days after receipt of such notice; or

          (d)  any representation or warranty made by either of the Owner
     Participant or the Grantor Trustee pursuant to Section 6 or 8, as the case
     may be, of the Participation Agreement shall prove to have been inaccurate
     in any material respect when made, unless such inaccurate representation or
     warranty shall not be material to the recipient at the time when the notice
     referred to below shall have been received by the Owner Participant or the
     Grantor Trustee or any material adverse impact thereof shall have been
     cured within thirty (30) days after receipt by the Owner Participant or the
     Grantor Trustee of a written notice thereof from the Indenture Trustee or
     any Holder of a Secured Note; provided that if such material adverse impact
     is remediable and the Owner Participant or Grantor Trustee is diligently
     attempting to remedy such impact, the Owner Participant or Grantor Trustee
     shall have 90 days after receipt of such written notice thereof to remedy
     any such material adverse impact; or

          (e)  either of the Owner Participant or the Grantor Trustee shall
     commence a voluntary case or other proceeding seeking liquidation,
     reorganization or other relief with respect to itself or its debts under
     any bankruptcy, insolvency or other similar law now or hereafter in effect
     or seeking the appointment of a trustee, receiver, liquidator, custodian or
     other similar official of its or any substantial part of its property, or
     shall consent to any such relief or to the appointment or taking possession
     by any such official or agency in an involuntary case or other proceeding
     commenced against it, or shall make a general assignment for the benefit of
     creditors, or shall take any corporate action to authorize any of the
     foregoing, or an involuntary case or other proceeding shall be commenced
     against either of the Owner Participant or the Grantor Trustee seeking
     liquidation, reorganization or other relief with respect to it or its debts
     under any bankruptcy, insolvency or other similar law now or hereafter in
     effect or seeking the appointment of a trustee, receiver, liquidator,
     custodian or other similar official or agency of its or any substantial
     part of its part of its property, and such involuntary case or other
     proceeding shall remain undismissed and unstayed for a period of ninety
     (90) days, or if, under the provisions of any law providing for
     reorganization or winding-up of corporations which may apply to the Grantor
     Trustee or the Owner Participant, any court of competent jurisdiction shall
     assume jurisdiction, custody or control of the Indenture Estate, the
     Grantor Trustee or the Owner Participant or of any substantial part of its
     property and such jurisdiction, custody or control shall remain in force
     unrelinquished, unstayed or unterminated for a period of ninety (90) days.

                                       31
<PAGE>

          SECTION 5.03.  Certain Rights. (a) If the Lessee shall fail to make
any payment of Basic Rent under the Lease when the same shall become due, and if
such failure of the Lessee to make such payment of Basic Rent shall not
constitute the fourth consecutive such failure or the seventh or subsequent
cumulative such failure, then as long as no Indenture Event of Default (other
than arising from a Lease Event of Default not involving any failure to make any
payments to which the Indenture Trustee or any Loan Participant is entitled
hereunder when due) shall have occurred and be continuing, the Owner Participant
or the Grantor Trustee may (but need not), without consent or concurrence of the
Indenture Trustee or any Holder, pay to the Indenture Trustee, in the manner
provided in Section 2.03, for application in accordance with Section 4.01, at
any time prior to the day which is the 11th day subsequent to the expiration of
the grace period provided for in Section l5(a) of the Lease with respect to the
payment of Basic Rent (and the Indenture Trustee shall not, without the prior
written consent of the Grantor Trustee, declare the Lease in default pursuant to
Section 16 thereof or exercise any of the rights, powers or remedies pursuant to
such Section 16 or Section 5.04 hereof prior to the occurrence of such later
date), an amount equal to such payment of Basic Rent sufficient to pay the
principal and interest then due on the Secured Notes, together with any interest
due thereon on account of the delayed payment thereof to the date of such
payment in accordance with Section 2.03(c) hereof, and such payment by the Owner
Participant or the Grantor Trustee shall be deemed to cure as of the date of
such payment any Indenture Event of Default which arose from such failure of the
Lessee (including any Lease Event of Default arising from the Lessee's failure
to pay interest in respect of such overdue Basic Rent for the period commencing
on the date of such payment), but such cure shall not relieve the Lessee of any
of its obligations. If the Lessee shall fail to perform or observe any covenant,
condition or agreement to be performed or observed by it under the Lease or any
other Lease Event of Default shall exist (other than the failure to pay Basic
Rent), and if (but only if) the performance or observance of such covenant,
condition or agreement or the cure of such Lease Event of Default can be
effected by the payment of money alone (it being understood that actions such as
the obtaining of insurance can be so effected), then as long as no other
Indenture Event of Default (other than those arising from a Lease Event of
Default) shall have occurred and be continuing, the Owner Participant or the
Grantor Trustee may (but need not), without consent or concurrence of the
Indenture Trustee or any Holder, pay to the Indenture Trustee (or to such other
person as may be entitled to receive the same), at any time prior to the day
which is the later of (x) the 11th day subsequent to notice of such failure or
such Lease Event of Default by the Indenture Trustee to the Grantor Trustee or
the Owner Participant and (y) the 11th day subsequent to the expiration of the
grace period, if any, provided with respect to such failure or such Lease Event
of Default on the part of the Lessee in Section 15 of the Lease (and the
Indenture Trustee shall not (without the prior written consent of the Grantor
Trustee) declare the Lease in default pursuant to Section 16 thereof or exercise
any of the rights, powers or remedies

                                       32
<PAGE>

pursuant to such Section 16 or Section 5.04 hereof prior to the occurrence of
such later date), all sums necessary to effect the performance or observance of
such covenant or agreement of the Lessee or to cure such Lease Event of Default,
together with any interest due thereon on account of the delayed payment thereof
to the date of such payment, and such payment by the Owner Participant or the
Grantor Trustee shall be deemed to cure as of the date of such payment any
Indenture Event of Default which arose from such failure of the Lessee or such
Lease Event of Default (including any Lease Event of Default arising from the
Lessee's failure to pay interest in respect of such overdue payment for the
period commencing on the date of such payment), but such cure shall not relieve
the Lessee of any of its obligations; provided that the Grantor Trustee and the
Owner Participant, collectively, shall not be entitled to cure any such Lease
Event of Default if the total amount outstanding and not reimbursed to such
parties exceeds in the aggregate $10,000,000.

          (b)  To the extent of any payment made by the Grantor Trustee or the
Owner Participant pursuant to Section 5.03(a), the Grantor Trustee or the Owner
Participant, as the case may be, shall be subrogated to the rights of the
Holders hereunder to receive from the Indenture Trustee the payment of Basic
Rent or other amount for which such payment was made by the Grantor Trustee or
the Owner Participant, as the case may be, and the Grantor Trustee or the Owner
Participant, as the case may be, shall be entitled to receive such payment from
the Indenture Trustee upon receipt thereof by the Indenture Trustee; provided,
however, that no such amount shall be paid to the Grantor Trustee or the Owner
Participant, as the case may be, unless all principal of and interest on the
Secured Notes then due and payable and any other amounts then due and payable
under the Secured Notes and this Indenture shall have been paid in full and no
Indenture Default shall have occurred and be continuing.

          (c)  The Grantor Trustee, upon exercising cure rights under Section
5.03(a) or rights under Section 6.08(a)(iii) or under Section 18.1 of the Lease
shall not obtain any Lien on any part of the Indenture Estate or Trust Estate
(including the Louisiana Trust Estate) on account of such payment for the costs
and expenses incurred in connection therewith nor shall any claims of the
Grantor Trustee against the Lessee or any other Person for the repayment thereof
impair the prior right and security interest of the Indenture Trustee in and to
the Indenture Estate or otherwise related to the Indenture Estate.

          (d)  If there shall occur an Indenture Event of Default pursuant to
Section 5.02(a) arising as a result of a failure by the Lessee to make any
payment of Rent when due, the Indenture Trustee shall so notify the Grantor
Trustee in writing promptly upon such occurrence.

          SECTION 5.04.  Remedies. (a) If an Indenture Event of Default shall
have occurred and be continuing and so long as the same shall be unremedied,
then and in every such case the Indenture Trustee, subject to Sections 5.03,
5.04(d), 5.05, 5.09, 6.01 and 6.08, may

                                       33
<PAGE>

exercise any or all of the rights and powers and pursue any and all of the
remedies herein provided or available under applicable law; provided, however,
the Indenture Trustee must give the Grantor Trustee at least 10 Business Days'
(or 5 Business Days in the case of acceleration of the Secured Notes other than
an automatic acceleration of the Secured Notes as provided in Section 5.04(c))
prior written notice of its intention to exercise remedies pursuant to this
Section 5.04 (it being understood that such notice may be given concurrently
with any notice of default given hereunder or under the Lease and prior to the
expiration of any applicable grace periods). Notwithstanding any contrary
provision herein, upon the occurrence and during the continuance of an Indenture
Event of Default, the Indenture Trustee may exercise, subject to Sections
5.03(a), 5.05, 5.09, 5.10 and 6.08, all rights and remedies of the Grantor
Trustee to the exclusion of the Grantor Trustee under the Lease (other than
those rights and remedies to the extent relating to Excepted Payments),
including without limitation the right to take possession of all or any part of
the Indenture Estate and exclude the Grantor Trustee and all Persons (including
the Lessee except to the extent of the Lessee's rights under the Agency and
Support Agreement) claiming under the Grantor Trustee wholly or partly
therefrom. In addition to and without limiting the foregoing, the Indenture
Trustee, upon at least twenty-five (25) days' prior written notice to the
Grantor Trustee and the Owner Participant, may invoke and exercise the power of
sale and sell any or all of the Indenture Estate in the manner required by law
at public auction, or in any other manner which shall be in accordance with
applicable law, or, in lieu of sale pursuant to the power of sale, the Indenture
Estate may be foreclosed, and the Indenture Trustee has and may exercise all
rights and remedies of a secured party under the Uniform Commercial Code as in
effect in any applicable jurisdiction or under Panamanian law, provided,
however, that if an Indenture Event of Default has occurred and is continuing
solely by virtue of one or more Lease Events of Default (at a time when no other
Indenture Events of Default shall have occurred and be continuing), the
Indenture Trustee shall not exercise foreclosure remedies under this Indenture
without exercising material remedies seeking to dispossess the Lessee under the
Lease, unless exercising such remedies under the Lease shall be prohibited by
law, governmental authority or court order, in which case the Indenture Trustee
shall not exercise foreclosure remedies under the Indenture until the expiration
of a period of 180 days from the commencement of such prohibition; provided,
further, that notwithstanding any provision herein to the contrary, the
Indenture Trustee shall not sell, assign, transfer or deliver any of the
Indenture Estate or take possession of the Indenture Estate unless the Secured
Notes shall have been accelerated pursuant to Section 5.04(b) or 5.04(c);
provided, further, that included in any such notice shall be a statement as to
the Indenture Trustee's intention to foreclose the Lien of this Indenture under
executory process pursuant to Title II of Book IV of the Louisiana Code of Civil
Procedure and any other related provision of law as such provision may be
amended from time to time. The Indenture Trustee shall notify the Grantor
Trustee, the Owner Participant and the Lessee as soon as is reasonably
practicable after its commencement of the exercise of any remedy pursuant to
this Section 5.04.

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<PAGE>

          (b)  If an Indenture Event of Default (other than an Indenture Event
of Default specified in Section 5.02(e) or an Indenture Event of Default of the
type specified in Section 5.02(a) which arises as a result of any Lease Event of
Default other than such Lease Event of Default as is specified in Section 15(f)
of the Lease) shall have occurred and be continuing, then, subject to Sections
5.03, 6.01 and 6.08, the Indenture Trustee may at any time, by five (5) days'
written notice to the Grantor Trustee, declare all (but not less than all) of
the Secured Notes to be due and payable. Upon such declaration the unpaid
principal of all Secured Notes then Outstanding, together with accrued but
unpaid interest thereon and any other amounts due thereunder, but without the
Make-Whole Amount or any other premium, shall immediately become due and payable
without presentment, demand, protest or notice, all of which are hereby waived.

          (c)  If an Indenture Event of Default of the type specified in Section
5.02(e), or an Indenture Event of Default of the type specified in Section
5.02(a) which arises as a result of any Lease Event of Default specified in
Section 15(f) of the Lease shall have occurred and be continuing, the principal
of all Secured Notes then Outstanding, together with accrued but unpaid interest
thereon and any other amounts due thereunder, but without the Make-Whole Amount
or any other premium, shall become and be due and payable automatically, without
declaration, notice, demand or any other action on the part of the Indenture
Trustee or any Holder, all of which are hereby waived. Each of Section 5.04(b)
and this Section 5.04(c), however, is subject to the condition that, if at any
time after the principal of the Secured Notes shall have become due and payable
upon a declared or automatic acceleration thereof as provided herein, and before
any judgment or decree for the payment of the money so due, or any portion
thereof, shall be entered, all overdue payments of interest upon the Secured
Notes and all other amounts payable under the Secured Notes (except the
principal of the Secured Notes which by such declaration shall have become
payable) shall have been duly paid, and every other Indenture Event of Default
with respect to any covenant or provision of this Indenture shall have been
cured, then in every such case a Majority in Interest of Holders of Notes, by
written instrument filed with the Indenture Trustee, may (but shall not be
obligated to) rescind and annul the Indenture Trustee's declaration and its
consequences; but no such rescission or annulment shall extend to or affect any
subsequent Event of Default or impair any right consequent thereon.

          (d)  Notwithstanding any provision in any document or instruction that
purports to require the Indenture Trustee to acquire title to any or all of the
Indenture Estate upon foreclosure, or pursuant to instructions, the Indenture
Trustee shall not be obligated to acquire any such title unless: (i) the
Indenture Trustee is provided with such security or indemnity as it shall deem
satisfactory to it, (ii) such acquisition of title complies with all applicable
Operative Documents, laws, rules and regulations, which shall be evidenced by an
opinion of counsel to such effect in form and substance satisfactory to the
Indenture

                                       35
<PAGE>

Trustee and (iii) the Indenture Trustee shall have obtained such executed
certificates, instruments or other documents, in accordance with its reasonable
inquiries or requests.

          SECTION 5.05.  Suit; Possession; Title; Sale of Indenture Estate. (a)
The Grantor Trustee agrees that, if an Indenture Event of Default shall have
occurred and be continuing and the Indenture Trustee shall be entitled to
exercise remedies hereunder as provided in Section 5.04, the Indenture Trustee
may take possession of all or any part of the Indenture Estate and may exclude
the Grantor Trustee, and all Persons claiming under the Grantor Trustee, wholly
or partly therefrom; provided, however, that at least 30 Business Days' prior
notice of such taking of possession shall be given to the Grantor Trustee. If an
Indenture Event of Default shall have occurred and be continuing and the
Indenture Trustee shall be entitled to exercise remedies hereunder as provided
in Section 5.04, at the request of the Indenture Trustee, the Grantor Trustee
shall promptly execute and deliver to the Indenture Trustee such instruments of
title and other documents as the Indenture Trustee may deem necessary or
advisable to enable the Indenture Trustee or any agent or representative
designated by the Indenture Trustee, at such time or times and place or places
as the Indenture Trustee may specify, to obtain possession of all or any part of
the Indenture Estate to which the Indenture Trustee shall at the time be
entitled hereunder. If the Grantor Trustee shall for any reason fail to execute
and deliver such instruments and documents after such request by the Indenture
Trustee, the Indenture Trustee may (i) obtain a judgment conferring on the
Indenture Trustee the right to immediate possession of any property comprising a
portion of the Indenture Estate and requiring the Grantor Trustee to execute and
deliver such instruments and documents to the Indenture Trustee, or (ii) pursue
all or part of such property wherever it may be found, and the Indenture Trustee
may enter any of the premises where such property or any portion thereof may be
or is supposed to be and search for such property. All expenses of obtaining
such judgment or of pursuing, searching for and taking such property shall,
until paid, be secured by the Lien of this Indenture and the Ship Mortgage.

          (b)  Upon every such taking of possession, the Indenture Trustee may
make, from time to time and at the expense of the Indenture Estate, such
expenditures for maintenance, insurance, repairs, replacements, alterations,
additions and improvements to and of the Indenture Estate as it may deem proper.
In each such case, the Indenture Trustee shall have the right to maintain, use,
operate, store, lease, control or manage the Indenture Estate and to exercise
all rights and power of the Grantor Trustee relating to the Indenture Estate as
the Indenture Trustee shall deem to be in the best interest of the Holders. The
Indenture Trustee shall be entitled to collect and receive directly all tolls,
rents (including Rent), revenue, issues, income, products and profits of the
Indenture Estate and every part thereof, other than Excepted Payments. Such
tolls, rents (including Rent), revenue, issues, income, products and profits
shall be applied (i) to pay the

                                       36
<PAGE>

expenses of the use, operation, storage, leasing, control, management or
disposition of the Indenture Estate, (ii) to pay the expense of all maintenance,
repairs, replacements, alterations, additions and improvements, (iii) to make
all payments which the Indenture Trustee may be required or may elect to make,
if any, for taxes, assessments, insurance or other proper charges upon the
Indenture Estate or any portion thereof, including without limitation the
employment of engineers and accountants to examine, inspect and make reports
upon the properties and books and records of the Grantor Trustee, and (iv) to
pay amounts owing in respect of the Secured Notes in accordance with the
provisions thereof and hereof and to make all other payments which the Indenture
Trustee may be required or authorized to make under any provision of this
Indenture or the Ship Mortgage, as well as just and reasonable compensation for
the services of the Indenture Trustee and of all Persons properly engaged and
employed by the Indenture Trustee.

          (c)  Any of the Indenture Trustee, any Holder, the Grantor Trustee or
the Owner Participant may be a purchaser of the Indenture Estate or any portion
thereof or any interest therein at any sale thereof, whether pursuant to
foreclosure or power of sale or otherwise. The Indenture Trustee may apply
against the purchase price thereof or the amount then due to it hereunder or
under any of the Secured Notes secured hereby and any Holder may apply against
the purchase price therefor the amount then due to it hereunder or under the
Secured Notes held by such Holder, to the extent of such portion of the purchase
price as it would have received had it been entitled to share in any
distribution thereof. The Indenture Trustee or any Holder or any nominee of any
such Holder shall acquire, upon any such purchase, good title to the property so
purchased, free of the Lien of this Indenture and, to the extent permitted by
applicable law, free of all rights of redemption in the Grantor Trustee in
respect of the property so purchased.

          (d)  Any sale or other conveyance of any of the Indenture Estate by
the Indenture Trustee made pursuant to the terms of this Indenture or the Ship
Mortgage, or the Lease shall bind the Grantor Trustee, the Holders and the Owner
Participant and shall be effective to transfer or convey all right, title and
interest of the Indenture Trustee, the Grantor Trustee, the Holders and the
Owner Participant in and to such Indenture Estate or portion thereof, as the
case may be. No purchaser or other grantee shall be required to inquire as to
the authorization, necessity, expediency or regularity of such sale or
conveyance, or as to the application of any sale or other proceeds with respect
thereto by the Indenture Trustee. In the event of any such sale, the Grantor
Trustee shall execute any and all such bills of sale, instruments of conveyance
and assignment and other documents, and perform and do all other acts and things
requested by the Indenture Trustee in order to permit continuation of such sale
and to effectuate the transfer or conveyance referred to in the first sentence
of this Section 5.05(d). The Grantor Trustee shall ratify and confirm any such
sale or sales by executing and delivering to the Indenture Trustee or to such
purchaser or purchasers all instruments as may reasonably be requested for such

                                       37
<PAGE>

purpose. Any such sale or sales made hereunder shall operate to divest all the
estate, right, title, interest, claim and demand whatsoever, whether at law or
in equity, of the Grantor Trustee in and to the properties and rights so sold,
and shall be a perpetual bar both at law and in equity against the Grantor
Trustee and against any and all persons claiming or who may claim the same, or
any part thereof from, through or under the Grantor Trustee. Upon any sale or
other disposition of the Indenture Estate by the Indenture Trustee, the
Indenture Trustee will promptly account in writing, in reasonable detail, to the
Grantor Trustee for the amount of such sale, the costs and expenses incurred in
connection therewith and any surplus proceeds.

          (e)  The Indenture Trustee shall, as a matter of right, be entitled to
the appointment of a receiver or a keeper pursuant to the terms and provisions
of La. R.S. 9:5136 et seq. (who may be the Indenture Trustee or any successor or
nominee thereof), at any time after an Indenture Event of Default either before
or after declaring due and payable the principal of all Secured Notes then
Outstanding, together with accrued but unpaid interest thereon and any other
amounts due thereunder, for all or any portion of the Indenture Estate, whether
such receivership or keepership be incidental to a proposed sale of the
Indenture Estate or the taking of possession thereof or otherwise, and the
Grantor Trustee hereby consents to the appointment of such a receiver or keeper,
and agrees that it will not oppose any such appointment. Any receiver or keeper
appointed for all or any portion of the Indenture Estate shall be entitled in
addition to any powers available under applicable law, to exercise all the
rights and powers of the Indenture Trustee with respect to the Indenture Estate.

          (f)  To the extent now or at any time hereafter enforceable under
applicable law, the Grantor Trustee covenants that it will not (i) at any time,
insist upon or plead, or in any manner whatsoever claim or take any benefit or
advantage of any stay, extension, moratorium, any exemption from execution or
sale or other similar law or from any law now or hereafter in force providing
for the valuation or appraisement of the Indenture Estate or any part thereof,
prior to any sale or sales thereof to be made pursuant to any provision herein
contained, or prior to any applicable decree, judgment or order of any court of
competent jurisdiction, nor (ii) after such sale or sales, claim or exercise any
right under any statute now or hereafter made or enacted by any state or any
right to have a portion of the Indenture Estate or the security for the Secured
Notes marshalled or otherwise redeem the property so sold or any part thereof,
and hereby expressly waives, for itself and on behalf of each and every Person
who may claim through or under it, except decree or judgment creditors of the
Grantor Trustee acquiring any interest in or title to the Indenture Estate or
any part thereof subsequent to the date of this Indenture, all benefit and
advantage of any such law or laws, and covenants that it will not invoke or use
any such law or laws, but will suffer and permit the execution of every such
power as though no such law or laws had been made or enacted. Nothing in this
Section 5.05(f) shall be deemed to be a waiver by the Grantor Trustee of its
rights under

                                       38
<PAGE>

Sections 5.03 or 5.04 hereof.

          The Indenture Trustee may maintain such a pleading, or, in any manner
whatsoever, claim or take any benefit or advantage of or from any law now or
hereafter in force even if it does not possess any of the Secured Notes or does
not produce any of them in the proceeding. A delay or omission by the Indenture
Trustee or any Holder in exercising any right or remedy accruing upon an
Indenture Event of Default under this Indenture shall not impair the right or
remedy or constitute a waiver of or acquiescence in such Indenture Event of
Default.

          (g)  The Indenture Trustee may adjourn from time to time any sale to
be made under or by virtue of this Indenture for such sale or for such adjourned
sale or sales, and, except as otherwise provided by any applicable provision of
law, the Indenture Trustee, without further notice or publication, may make such
sale at the time and place to which the same shall be so adjourned.

          (h)  Any recovery of any judgment by the Indenture Trustee under the
Secured Notes and any levy of any execution under any such judgment upon the
Indenture Estate shall not affect in any manner or to any extent the security
title and security interest conveyed hereby upon the Indenture Estate or any
part thereof, or any conveyances, powers, rights and remedies or the Indenture
Trustee hereunder, but such conveyances, powers, rights and remedies shall
continue unimpaired as before.

          (i)  Notwithstanding anything contained herein, so long as the Pass
Through Trustee is a registered Holder, the Indenture Trustee is not authorized
or empowered to acquire title to all or any portion of the Indenture Estate or
take any action with respect to all or any portion of the Indenture Estate so
acquired by it if such acquisition or action would cause the Pass Through Trust
to fail to qualify as a "grantor trust" for federal income tax purposes.

          SECTION 5.06.  Remedies Cumulative. Each and every right, power and
remedy provided the Indenture Trustee specifically or otherwise in this
Indenture shall be cumulative and shall be in addition to every right, power and
remedy herein specifically provided or now or hereafter existing at law, in
equity or otherwise. Each and every such right, power and remedy may be
exercised from time to time and as often and in such order as may be deemed
expedient by the Indenture Trustee, and the exercise or the beginning of the
exercise of any such right, power or remedy shall not be construed to be a
waiver of the right to exercise at the same time or thereafter any other right,
power or remedy. No delay or omission by the Indenture Trustee in the exercise
of any right or power or in the pursuit of any remedy shall impair any such
right, power or remedy, or be construed to be a waiver of any Indenture Event of
Default or to be an acquiescence therein.

          SECTION 5.07.  Discontinuance of Proceedings. In case

                                       39
<PAGE>

the Indenture Trustee shall have instituted any proceeding to enforce any right,
power or remedy under this Indenture by foreclosure, entry or otherwise, and
such proceeding shall have been discontinued or abandoned for any reason or
shall have been determined adversely to the Indenture Trustee, then and in every
such case the Grantor Trustee, the Indenture Trustee and the Lessee shall,
subject to any determination in such proceeding, be restored to their former
positions and rights hereunder with respect to the Indenture Estate, and all
right, powers and remedies of the Indenture Trustee shall continue as if no such
proceeding had been instituted.

          SECTION 5.08.  Waiver of Past Defaults. Upon written instruction of a
Majority in Interest of Holders of Notes, the Indenture Trustee shall waive any
Indenture Event of Default specified in such instruction and its consequences,
and upon any such waiver such Indenture Event of Default shall cease to exist
for every purpose of this Indenture; provided, however, that no such waiver
shall extend to any subsequent or other Indenture Event of Default or impair any
right or consequence thereof; and provided further, however, that in the absence
of the written instruction of the Holders of all Secured Notes then Outstanding,
the Indenture Trustee shall not waive any Indenture Event of Default arising
from a default (i) in the payment of the principal of, Make-Whole Amount, if
any, or interest on, or other amounts due under, any Secured Note then
Outstanding, or (ii) in respect of a covenant or provision hereof which pursuant
to the terms of Article IX cannot be modified or amended without the consent of
each Holder of a Secured Note then Outstanding.

          SECTION 5.09.  No Action Contrary to Lessee's Rights Under the Lease.
Notwithstanding any other provision of any Operative Document, (i) unless a
Lease Event of Default shall have occurred and be continuing and the Lease shall
have been declared to be in default pursuant to Section 16.1 thereof, the
Indenture Trustee shall not take or cause to be taken any action contrary to the
Lessee's rights under the Lease, including without limitation the rights of the
Lessee under Section 9.1 thereof and (ii) the Indenture Trustee shall not take
or cause to be taken any action contrary to the rights of the Other Owner and
its successors and assigns under Section 9.1 of the Lease.

          SECTION 5.10.  Rights of Holders of Secured Notes. Notwithstanding any
provision herein (including Section 5.11) to the contrary, the Holder of a
Secured Note shall have the absolute and unconditional right to receive payment
from the Indenture Estate of the principal of and interest on such Secured Note
on the dates and as specified in such Secured Note, and to institute suit
against the Grantor Trustee for the enforcement of any such payment, subject to
Section 2.02, and such right shall not be impaired without the consent of such
Holder.

          SECTION 5.11.  Limitation on Suits by Holders. A Holder may pursue a
remedy under this Indenture or under a Secured Note only if:

                                       40
<PAGE>

             (i)   the Holder gives to the Indenture Trustee written notice of a
     continuing Indenture Event of Default under this Indenture;

             (ii)  the Holders of at least 25 percent (25%) of the Outstanding
     principal amount of the Secured Notes instruct the Indenture Trustee to
     pursue the remedy;

             (iii) such Holder or Holders offer to the Indenture Trustee
     indemnity satisfactory to the Indenture Trustee against any loss, liability
     or expense to be, or which may be, incurred by the Indenture Trustee in
     pursuing the remedy;

             (iv)  the Indenture Trustee does not comply with the request within
     60 days after receipt of the instructions and the offer of indemnity; and

             (v)   during such 60-day period, a Majority in Interest of Holders
     do not give the Indenture Trustee an instruction 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 5.12.  Trustee May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceedings, or any voluntary or involuntary case under United States bankruptcy
laws, as now or hereafter constituted, relative to the Grantor Trustee or the
Lessee, if obligated on the Secured Notes, the Indenture Trustee (irrespective
of whether the principal of the Secured Notes shall then be due and payable as
therein expressed or by declaration or otherwise and irrespective of whether the
Trustee shall have made any demand on the Grantor Trustee or the Lessee, as the
case may be, for the payment of overdue principal, Make-Whole Amount, if any, or
interest) shall be entitled and empowered, by intervention in such proceeding or
otherwise, to file and prove a claim for the whole amount of principal (and the
Make-Whole Amount, if any) and interest owing and unpaid in respect of the
Secured Notes, to file such other papers or documents and to take such other
actions, including participating as a member or otherwise in any official
committee of creditors appointed in the matter, as may be necessary or advisable
in order to have the claims of the Trustee and the Holders allowed in such
judicial proceeding.

                                  ARTICLE VI

                        DUTIES OF THE INDENTURE TRUSTEE

                                       41
<PAGE>

          SECTION 6.01.  Certain Actions. If the Indenture Trustee shall have
Actual Knowledge of any Indenture Event of Default or any Indenture Default or
any failure on the part of the Lessee to make any payment of Rent when due or
any Event of Loss or any other material fact relating to the Undivided Interest,
the Indenture Trustee shall (a) give prompt telephonic notice (promptly
confirmed in writing) to the Grantor Trustee, the Owner Participant and the
Lessee and (b) within 90 days after obtaining such Actual Knowledge, mail to
each Holder, notice of all Indenture Events of Default unless, in each case,
such Indenture Event of Default has been remedied before the giving of such
notice and the Indenture Trustee has Actual Knowledge that such Indenture Event
of Default has been so remedied; provided, however, that the failure by the
Indenture Trustee to provide such notice shall not invalidate any actions
subsequently taken by the Indenture Trustee in connection with such Indenture
Event of Default. Except in the case of a default in the payment of the
principal or interest on any Secured Note, the Indenture Trustee shall be
protected in withholding the notice required under clause (b) above if and so
long as Responsible Officers of the Indenture Trustee in good faith determine
that withholding such notice is in the interest of the Holders. Notwithstanding
any other provision hereof, the Indenture Trustee shall not be required to make
any determination of materiality pursuant to Section 5.02(c) or (d).

          SECTION 6.02.  Action Upon Instructions. (a) The Indenture Trustee
shall, upon the written instruction at any time and from time to time of a
Majority in Interest of Holders of Notes, give such notice, consent or direction
or exercise such right, remedy or power hereunder or under the Lease or any
other agreement constituting part of the Indenture Estate as shall be specified
in such instruction; provided, however, that nothing set forth in this Section
6.02(a) shall entitle the Holders to cause the Indenture Trustee to give any
notice or exercise any right, power or remedy that is not elsewhere authorized
by, or is otherwise restricted or prohibited by, this Indenture. If the
Indenture Trustee shall not have received instructions as above provided within
twenty (20) calendar days after mailing of the notice pursuant to Section 6.01
to the Holders, the Indenture Trustee may take such action, or refrain from
taking such action, but shall be under no duty to take or refrain from taking
any action, with respect to such Indenture Default, Indenture Event of Default,
Event of Loss or fact as it shall determine to be advisable and in the best
interest of the Holders. If the Indenture Trustee receives any instructions
after the expiration of the aforementioned twenty day period, the Indenture
Trustee shall use its best efforts to conform any action being taken to comply
with those instructions.

          (b)  The Indenture Trustee shall not consent to the assignment by the
Lessee of all or any material portion of its right, title and interest in, to
and under the Lease, except (i) with respect to an assignment permitted under
Section 14.2 of the Lease or (ii) upon the written instruction at any time and
from time to time of a Majority in

                                       42
<PAGE>

Interest of Holders of Notes. Nothing set forth herein shall be construed to
permit such assignment without the consent of the Grantor Trustee or to
adversely affect any right of the Grantor Trustee.

          SECTION 6.03.  Release of Lien of Indenture. (a) Release of Indenture
Estate. Upon satisfaction of the conditions for termination of this Indenture
set forth in Section 10.01, the Indenture Trustee, upon the written request of
the Grantor Trustee, shall execute and deliver to, or as directed by, the
Grantor Trustee, all appropriate instruments (in due form for recording or
filing) releasing the Indenture Estate from the Lien of this Indenture, and the
Indenture Trustee shall pay all moneys or other properties or proceeds held by
it under this Indenture to the Grantor Trustee and shall give notice to the
Lessee of such payment. The cost and expense associated with any action taken by
the Indenture Trustee pursuant to the provisions of this Section 6.03(a) shall
be borne by the Lessee.

          (b)  Release of the Undivided Interest Upon Transfer. Upon any
transfer by the Grantor Trustee of the Lessor's Interest in the Undivided
Interest or a Significant Portion thereof pursuant to Section 6.1, 7, 11.7(b) or
12 of the Lease or any retention by the Grantor Trustee of the Lessor's Interest
in the Undivided Interest pursuant to Section 7 of the Lease and receipt by the
Indenture Trustee of all amounts of Rent therefor that constituted a part of the
Indenture Estate due and payable by the Lessee and the concurrent redemption of
Secured Notes as set forth in Sections 3.02 and 4.02 and the payment of any
other amounts then due and owing hereunder, the Indenture Trustee, upon the
written request of the Grantor Trustee, shall execute and deliver to, or as
directed by, the Grantor Trustee, all appropriate instruments (in due form for
recording or filing) releasing the Undivided Interest or such Significant
Portion, as the case may be, and the Grantor Trustee's interest therein and all
other property solely relating thereto and then constituting a portion of the
Indenture Estate (or if not solely relating thereto, but such other property can
be reasonably partitioned without undue burden or delay, such other property),
as the case may be, from the Lien of this Indenture. The cost and expense
associated with any action taken by the Indenture Trustee pursuant to the
provisions of this Section 6.03(b) shall be borne by the Lessee.

          (c)  Release of Lien upon Full Payment of Secured Notes. Upon payment
in full of the principal of and interest on and all other amounts due and
payable under the Secured Notes, and all other amounts due and payable to any
Holder or the Indenture Trustee hereunder or, to the extent secured hereby,
under any other Operative Document, the Indenture Trustee, upon the written
request of the Grantor Trustee, shall execute and deliver to, or as directed by,
the Grantor Trustee, all appropriate instruments (in due form for recording or
filing) releasing the Undivided Interest, and the Lessor's Interest therein, and
all other property relating thereto and then constituting a portion of the
Indenture Estate from the Lien of this Indenture. The cost and expense
associated with any action taken by the Indenture Trustee pursuant to the
provisions of

                                       43
<PAGE>

this Section 6.03(c) shall be borne by the Lessee.

          SECTION 6.04.  Indemnification. The Indenture Trustee shall not be
required to take any action or refrain from taking any action instructed to be
taken or refrained from being taken pursuant to Section 6.02 or under Article V
unless the Indenture Trustee shall have been offered reasonable security or
indemnity against any liability (including without limitation environmental
liability), cost or expense (including without limitation the reasonable fees
and expenses of counsel) which may be incurred in connection therewith, other
than any such liability, cost or expense which results from the willful
misconduct or gross negligence of the Indenture Trustee or from the failure of
the Corporate Indenture Trustee to exercise ordinary care in distributing funds
in accordance with the terms of the Operative Documents. Except with respect to
actions required by the first sentence of Section 6.01 hereof, the Indenture
Trustee shall be under no obligation to take any action under this Indenture and
nothing contained in this Indenture shall require the Indenture Trustee to
expend or risk the Indenture Trustee's own funds or otherwise incur any
financial liability or any other liability (including without limitation
environmental liability) in the performance of any of the Indenture Trustee's
duties hereunder or in the exercise of any of the Indenture Trustee's rights or
powers if it shall have reasonable grounds for believing that repayment of such
funds or adequate security or indemnity against such risk or liability is not
reasonably assured to it. The Indenture Trustee shall not be required to take
any action under Section 6.02 or Article V, nor shall any other provision of
this Indenture be deemed to impose a duty on the Indenture Trustee to take any
action, if the Indenture Trustee shall have reasonably determined or been
advised in writing by its counsel that such action is contrary to the terms
hereof or of any other Operative Document, or is contrary to applicable law.

          SECTION 6.05.  No Implied Duties. Except during the continuance of an
Indenture Event of Default known to the Indenture Trustee, the Indenture Trustee
need perform only those duties as are specifically set forth in this Indenture
and no others and no implied duties or obligations of the Indenture Trustee
shall be read into this Indenture.

          SECTION 6.06.  Duties to Remove Certain Liens. The Corporate Indenture
Trustee and the Individual Indenture Trustee, each in its individual capacity,
shall comply with Section 11.4(a) of the Participation Agreement.

          SECTION 6.07.  No Action Except Under Operative Documents or
Instructions. The Grantor Trustee and the Indenture Trustee agree that they will
not use, operate, store, lease, control, manage, sell, dispose of or otherwise
deal with the Undivided Interest or any other part of the Indenture Estate
except (a) in accordance with the terms of the Lease or the other Operative
Documents or (b) in accordance with the

                                       44
<PAGE>

powers granted to, or the authority conferred upon, the Grantor Trustee and the
Indenture Trustee pursuant to the express terms of this Indenture and the Trust
Agreement.

          SECTION 6.08.  Certain Rights of the Grantor Trustee and the Owner
Participant. Notwithstanding any provision in this Indenture to the contrary:

          (a)  each of the Grantor Trustee and the Owner Participant shall have
     the right, to the exclusion of the Indenture Trustee, whether or not an
     Indenture Event of Default is continuing and whether or not the Indenture
     Trustee has foreclosed on the Lien of the Indenture, (i) to receive
     Excepted Payments, (ii) to demand, collect, sue for or give any notice of
     default or Lease Event of Default with respect to Excepted Payments, (iii)
     prior to the foreclosure of the Lien of the Indenture and subject to
     Section 5.03(c), to declare the Lease in default in respect of Excepted
     Payments, (iv) to enforce the payment of Excepted Payments due and payable
     to it by appropriate judicial proceedings and to exercise other remedies as
     provided under any Operative Document to the extent and with respect to any
     portion of the Indenture Estate which shall have been released pursuant to
     the terms of this Indenture and (v) to exercise all rights with respect to
     Credit Support (or any letter of credit that names the Owner Participant or
     the Lessor as a beneficiary or any surety bond issued to the Owner
     Participant or the Lessor), including the right to receive all payments
     with respect thereto and to amend, supplement, waive or modify any
     agreements constituting Credit Support (or any letter of credit that names
     the Owner Participant or the Lessor as a beneficiary or any surety bond
     issued to the Owner Participant or the Lessor); provided that the rights
     referred to in this Section 6.08(a)(iii) and (iv) shall not be deemed to
     include the exercise of any remedies provided for in Section 16 of the
     Lease other than the remedies provided in Section 16.1(g) of the Lease and
     the right to proceed by appropriate court action or actions, either at law
     or in equity, to enforce performance by the Lessee of the applicable
     covenants or to recover damages for breach thereof;

          (b)  at all times prior to the foreclosure of the Lien of the
     Indenture, whether or not an Indenture Event of Default is continuing, each
     of the Grantor Trustee and the Owner Participant shall have the right, but
     not to the exclusion of the Indenture Trustee, (i) to receive from the
     Lessee all notices, financial statements, certificates, opinions of counsel
     and other documents and information which the Lessee is permitted or
     required to give or furnish to the Grantor Trustee or the Owner Participant
     pursuant to the terms of any Operative Document, (ii) to retain all rights
     with respect to liability insurance which Section 13 of the Lease
     specifically confers upon the Grantor Trustee or the Owner Participant, or
     other insurance under Section 13.4 of the Lease

                                       45
<PAGE>

     purchased for the benefit of the Grantor Trustee or the Owner Participant
     (subject, however to the provisions of the definition of "Excepted
     Payments") and (iii) to exercise inspection rights pursuant to Section 10.7
     of the Participation Agreement and Section 11.2 of the Lease;

          (c)  prior to the foreclosure of the Lien of the Indenture and whether
     or not an Indenture Event of Default shall have occurred and be continuing,
     the Grantor Trustee shall have the right, to the exclusion of the Indenture
     Trustee, to adjust Basic Rent Percentages, Stipulated Loss Value
     Percentages and Termination Value Percentages and the Early Buy-Out
     Percentage pursuant to Section 4 of the Lease but subject to the
     limitations set forth in Section 3.5 of the Lease; and

          (d)  So long as no Indenture Event of Default shall have occurred and
     be continuing (subject to Section 9.02), the Grantor Trustee shall retain
     (to the exclusion of the Indenture Trustee) all rights of the "Lessor"
     under the Lease, other than the Indenture Trustee's right to receive any
     funds assigned to the Indenture Trustee under the terms of this Indenture.

          SECTION 6.09.  Filing of Financing and Continuation Statements. The
Indenture Trustee shall, at the expense of the Grantor Trustee, execute and file
any continuation or similar statement or document delivered to it by the Grantor
Trustee or the Lessee in a form reasonably satisfactory to the Indenture Trustee
and proper for filing.

          SECTION 6.10.  Furnishing of Notices. The Indenture Trustee will
furnish to the Grantor Trustee and the Owner Participant, promptly, but in any
event within 30 days, upon receipt thereof, a duplicate or copy of each report,
notice, request, demand, instruction, certificate, financial statement or other
instrument furnished to the Indenture Trustee hereunder or under any other
Operative Document, unless such report, notice, request, demand, instruction,
certificate, financial statement or other instrument is required to be furnished
directly to the Grantor Trustee or the Owner Participant under any Operative
Document.

          SECTION 6.11.  Taxes; Withholdings; Information Reporting. The
Indenture Trustee shall exclude and withhold from each distribution of principal
and interest and other amounts due hereunder or under the Secured Notes any and
all withholding taxes applicable thereto as required by law. The Indenture
Trustee agrees (a) to act as such withholding agent and, in connection
therewith, whenever any present or future taxes or similar charges are required
to be withheld with respect to any amounts payable in respect of the Secured
Notes or otherwise due hereunder, to withhold such taxes or charges and timely
pay the same to the appropriate authority in the name of and on behalf of the
Loan Participants, (b) that it will file any necessary withholding tax returns

                                       46
<PAGE>

or statements when due and (c) that, as promptly as possible after the payment
of such withheld amounts, it will deliver to each Loan Participant appropriate
documentation showing the payment of such withheld amounts, together with such
additional documentary evidence as such Loan Participants may reasonably request
from time to time. The Indenture Trustee agrees to file any other information
reports as it may be required to file under United States law. No withholding or
action with respect thereto hereunder shall constitute or give rise to any
Indenture Event of Default or any other claims against the Owner Participant or
the Grantor Trustee. Any tax withheld by the Indenture Trustee pursuant to this
Section 6.11 shall be deemed for all purposes of this Indenture and the Secured
Notes to have been paid to the Holder with respect to which such tax was
withheld.

                                  ARTICLE VII

                 THE INDENTURE TRUSTEE AND THE GRANTOR TRUSTEE

          SECTION 7.01.  Acceptance of Trusts and Duties. The Indenture Trustee
accepts the duties hereby created and applicable to it and agrees to perform the
same upon the terms and conditions set forth in this Indenture and the
Participation Agreement. The Corporate Indenture Trustee further agrees to
receive and disburse all moneys constituting part of the Indenture Estate in
accordance with the terms hereof. The Indenture Trustee shall not be answerable
or accountable in its individual capacity under any circumstances, except (a)
for its willful misconduct or gross negligence, (b) for its failure to exercise
and use the care and skill in safeguarding the security held by it pursuant to
the terms hereof that a prudent person would exercise or use under the
circumstances in the conduct of his own affairs, (c) in the case of the
inaccuracy of any representations or warranties made by the Indenture Trustee in
its individual capacity and contained in the Participation Agreement or any
other Operative Document or referred to by reference in Section 7.03 hereof, (d)
as provided in Sections 2.03 and 6.06, (e) for any Tax based on or measured by
any fees, commissions or compensation received by it for acting as trustee
hereunder, or (f) except as otherwise expressly provided herein for its failure
to use reasonable care in disbursing funds in accordance with the terms hereof.

          SECTION 7.02.  Absence of Duties Except as Specified. Except in
accordance with written instructions furnished pursuant to Section 6.01 or 6.02,
and except as provided in, and without limiting the generality of, Sections
6.04, 6.05, 6.06 and 6.07, the Indenture Trustee shall have no duty (a) to
record or file the Lease or this Indenture or any other document, or to maintain
any such recording or filing, or to rerecord or refile any such document, (b) to
effect or maintain any insurance required under the Lease with respect to the
Undivided Interest, whether or not the Lessee shall be in default with respect
thereto, (c) to discharge any Lien of any kind against any part of the Trust
Estate (including the Louisiana Trust Estate) or the

                                       47
<PAGE>

Indenture Estate, or (d) to inspect the Undivided Interest at any time, or to
ascertain or inquire as to the performance or observance of any of the Lessee's
covenants pursuant to the terms of the Lease.

          SECTION 7.03.  No Representations or Warranties. NEITHER THE GRANTOR
TRUSTEE NOR THE INDENTURE TRUSTEE MAKES (IN ITS INDIVIDUAL OR TRUST CAPACITY)
(a) ANY REPRESENTATION OR WARRANTY, WHETHER WRITTEN, ORAL, EXPRESS OR IMPLIED,
AS TO THE VALUE, COMPLIANCE WITH SPECIFICATIONS, DURABILITY, OPERATION,
CONSTRUCTION, PERFORMANCE, DESIGN OR CONDITION OF THE PRODUCTION SYSTEM OR ANY
PART THEREOF, THE MERCHANTABILITY THEREOF OR THE FITNESS THEREOF FOR ANY
PARTICULAR PURPOSE, TITLE TO THE PRODUCTION SYSTEM OR ANY COMPONENT OF THE
PRODUCTION SYSTEM, THE QUALITY OF THE MATERIALS OR WORKMANSHIP THEREOF OR
CONFORMITY THEREOF TO SPECIFICATIONS, OR THE PRESENCE OR ABSENCE OF ANY LATENT
OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, OR ANY OTHER REPRESENTATION OR
WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO THE PRODUCTION SYSTEM,
OR ANY COMPONENT OF THE PRODUCTION SYSTEM, or (b) any representation or warranty
as to the validity, legality or enforceability of this Indenture, any of the
other Operative Documents or the Secured Notes, or as to the correctness of any
statement contained in any thereof, except as set forth in Sections 8 and 9 of
the Participation Agreement and Section 7.3 of the Trust Agreement.

          SECTION 7.04.  No Segregation of Moneys; No Interest; Investments. Any
moneys paid to or retained by the Indenture Trustee pursuant to any provision
hereof and not then required to be distributed to the Holders, the Lessee or the
Grantor Trustee shall be deposited in a separate, interest bearing cash
collateral account; provided that any payments received or applied hereunder by
the Indenture Trustee shall be accounted for by the Indenture Trustee so that
any portion thereof paid or applied pursuant hereto shall be identifiable as to
the source thereof. Any amounts held by the Indenture Trustee pursuant to the
express terms of this Indenture or any other Operative Document shall be
invested and reinvested by the Indenture Trustee from time to time in Permitted
Investments at the direction of (i) the Lessee if such amounts would be payable
to the Lessee upon satisfaction of any applicable conditions; or (ii) the Owner
Participant in the case of the remaining portion of such amounts; provided,
however, that in the event there shall be continuing any Indenture Event of
Default such directions may be given exclusively by a Majority in Interest of
Holders of Notes. The Indenture Trustee shall have no liability for any loss
resulting from any investment required to be made hereunder other than by reason
of its own willful misconduct or negligence in failing to comply with such
instructions. Any net income or gain realized as a result of any such investment
or reinvestment shall be held as part of the Indenture Estate and shall be
applied by the Indenture Trustee at the same time, on the same conditions and in
the same manner as the amounts in respect of which such income or gain was
realized are required to be distributed in accordance with the provisions
hereof. Any

                                       48
<PAGE>

Permitted Investment may be sold or otherwise reduced to cash (without regard to
maturity) by the Indenture Trustee whenever necessary to make any application as
required by the terms of this Indenture or of any applicable Operative Document.

          SECTION 7.05.  Reliance; Agents; Advice of Counsel. Neither the
Grantor Trustee nor the Indenture Trustee (in their respective individual or
trust capacities for the purposes of this Section 7.05) shall incur any
liability to anyone in acting upon any signature, instrument, notice,
resolution, request, consent, order, certificate, report, opinion, bond or other
document or paper reasonably believed by it to be genuine and believed by it to
be signed by the proper party or parties. Either of the Grantor Trustee or the
Indenture Trustee may accept a copy of a resolution of the Board of Directors or
other governing body of any party to the Participation Agreement or other
Operative Agreement, certified by the Secretary or any Assistant Secretary
thereof as duly adopted and in full force and effect, as conclusive evidence
that such resolution has been duly adopted and that the same is in full force
and effect. As to any fact or matter relating to the Lessee the manner of
ascertainment of which is not specifically described herein, the Grantor Trustee
and the Indenture Trustee may for all purposes hereof rely on an Officer's
Certificate of the relevant party as to such fact or matter, and such Officer's
Certificate shall constitute full protection to the Grantor Trustee or the
Indenture Trustee (in its individual or trust capacities), as the case may be,
for any action taken or omitted to be taken by it in good faith in reliance
thereon. The Indenture Trustee shall assume, and shall be fully protected in
assuming, that the Grantor Trustee is authorized by the Trust Agreement to enter
into this Indenture and to take all action to be taken by the Grantor Trustee
pursuant to the provisions hereof, and shall not inquire into the authorization
of the Grantor Trustee with respect thereto. The Grantor Trustee shall assume,
and shall be fully protected in assuming, that the Indenture Trustee is
authorized to enter into this Indenture and to take all action to be taken by
the Indenture Trustee pursuant to the provisions hereof, and shall not inquire
into the authorization of the Indenture Trustee with respect thereto. In the
administration of the trusts hereunder, the Indenture Trustee may execute any of
the trusts or powers hereof and perform its powers and duties hereunder directly
or through agents or attorneys and at the expense of the Indenture Estate may
consult with counsel, accountants and other skilled Persons to be selected and
retained by it, and the Indenture Trustee shall not be liable for anything done,
suffered or omitted in good faith by it in accordance with the written advice or
written opinion of any such counsel, accountant or other skilled Person acting
within such Person's area of competence (so long as the Indenture Trustee shall
have exercised due care in selecting such Person).

          SECTION 7.06.  No Compensation from Holders or Indenture Estate.
Notwithstanding any other provision hereof, the Indenture Trustee shall have no
right against the Holders, the Grantor Trustee, the Owner Participant or, except
as otherwise provided in Section 4.03, the Indenture Estate for any fee as
compensation for its services hereunder.

                                       49
<PAGE>

          SECTION 7.07.  Right of the Indenture Trustee to Perform Covenants,
Etc. If the Grantor Trustee or the Lessee shall fail to make any payment or
perform any act required to be made or performed by it hereunder or under any
Operative Document to which it is a party or if the Grantor Trustee or the
Lessee shall fail to release any Lien affecting the Indenture Estate which it is
required to release by the terms of this Indenture or any other Operative
Document to which it is a party, the Indenture Trustee, after notice to and
demand upon the Grantor Trustee or the Lessee and affording the Grantor Trustee
and the Lessee a reasonable opportunity to cure, and without waiving or
releasing any obligation or Lease Event of Default, may (but shall be under no
obligation to) at any time thereafter make such payment or perform such act for
the account of and at the expense of the Indenture Estate, and may enter upon
any property for such purpose and take all such action with respect thereto as,
in the Indenture Trustee's opinion, may be necessary or appropriate therefor. No
such entry shall be deemed an eviction. All sums so paid by the Indenture
Trustee and all costs and expenses including taxes (other than taxes based upon
or measured by or determined by the income of the Indenture Trustee (including,
without limitation, legal fees and expenses of counsel of its selection) so
incurred, shall constitute additional indebtedness secured by this Indenture and
shall be paid from the Indenture Estate to the Indenture Trustee on demand. The
Indenture Trustee shall not be liable for any damages resulting from any such
payment or action unless such damages shall be a consequence of willful
misconduct or gross negligence on the part of the Indenture Trustee.

          SECTION 7.08.  Moneys for Payments in Respect of Notes to be Held in
Trust. In case the Holder of any Secured Note shall fail to present the same for
payment on any date on which the principal thereof becomes payable, the
Indenture Trustee may set aside in trust the moneys then due thereon uninvested
and shall pay such moneys to any Holder of such Secured Note upon due
presentation for surrender thereof in accordance with the provisions of this
Indenture, subject to the provisions of Section 7.09.

          SECTION 7.09.  Disposition of Moneys Held for Payments of Notes. Any
money set aside under Section 7.08 and not paid to Holders under Section 7.08
shall be held by the Indenture Trustee in trust until the latest of (a) the date
three years after the date of such setting aside, (b) the date all other Holders
(other than other Holders for which the Indenture Trustee is holding such moneys
pursuant to Section 7.08) of the Secured Notes shall have received full payment
of all principal of and interest and other sums payable to them on such Secured
Notes or the Indenture Trustee shall hold (and shall have notified such Persons
that it holds) in trust an amount sufficient to make full payment thereof when
due, and (c) the date the Grantor Trustee shall have fully performed and
observed all its covenants and obligations contained in this Indenture with
respect to the Secured Notes; and thereafter shall be paid to the Grantor
Trustee by the Indenture Trustee who then shall be released from all further
liability with respect to such moneys, and thereafter the

                                       50
<PAGE>

Holders of the Secured Notes in respect of which such moneys were so paid to the
Grantor Trustee shall have no rights in respect thereof except to obtain payment
of such moneys from the Grantor Trustee.

                                 ARTICLE VIII

                  SUCCESSOR TRUSTEES AND ADDITIONAL TRUSTEES

          SECTION 8.01.  Notice of Successor Grantor Trustees. In the case of
any appointment of a successor to the Grantor Trustee pursuant to the Trust
Agreement, or any merger, conversion or consolidation or transfer of
substantially all of the corporate trust business of the Grantor Trustee, the
successor Grantor Trustee shall give prompt written notice thereof to the
Indenture Trustee.

          SECTION 8.02.  Resignation of Indenture Trustee; Appointment of
Successor. (a) The Indenture Trustee or any successor thereto may resign at any
time without cause by giving at least thirty (30) days prior written notice to
the Grantor Trustee, the Owner Participant, the Lessee and each Holder, such
resignation to be effective upon the acceptance of the trusteeship by a
successor Indenture Trustee as provided in Section 8.02(b); provided such
resignation has no material effect on the Indenture Estate. In addition, a
Majority in Interest of Holders of Notes may at any time remove the Indenture
Trustee without cause by an instrument in writing delivered to the Grantor
Trustee, the Owner Participant, the Lessee and the Indenture Trustee, such
removal to be effective upon the acceptance of the trusteeship by a successor
Indenture Trustee as provided in Section 8.02(b). In the case of the resignation
or removal of the Indenture Trustee, the Grantor Trustee may appoint a successor
Indenture Trustee reasonably satisfactory to the Owner Participant. If a
successor Indenture Trustee shall not have been appointed within thirty (30)
days of such notice of resignation or removal, the Indenture Trustee, the
Grantor Trustee, the Owner Participant, the Lessee or a Majority in Interest of
Holders may apply to any court of competent jurisdiction to appoint a successor
Indenture Trustee qualified under Section 8.02(c) to act until such time, if
any, as a successor shall have been appointed as above provided in this Section
8.02. The successor Indenture Trustee so appointed by such court shall
immediately and without further act be superseded by any successor Indenture
Trustee appointed as above provided in this Section 8.02.

          (b)  Any successor Indenture Trustee, however appointed, shall execute
and deliver to the Grantor Trustee and to the predecessor Indenture Trustee
(with a copy to each Holder) an instrument accepting such appointment, and shall
give the Owner Participant, the Holders and the Lessee written notice of such
acceptance. Upon the execution and delivery of such instrument, such successor
Indenture Trustee, without further act, shall become vested with all the
estates, properties, rights, powers and duties of the predecessor Indenture
Trustee hereunder with like effect as if originally named the Indenture Trustee
herein.

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<PAGE>

Notwithstanding and without limiting the foregoing, the predecessor Indenture
Trustee, upon the written request of the successor Indenture Trustee, shall
execute and deliver an instrument transferring to such successor Indenture
Trustee, upon the trusts herein expressed applicable to it, all the estates,
properties, rights and powers of such predecessor Indenture Trustee, and such
predecessor Indenture Trustee shall duly assign, transfer, deliver and pay over
to such successor Indenture Trustee all moneys or other property then held by
such predecessor Indenture Trustee hereunder.

          (c)  There shall at all times be a Corporate Indenture Trustee
hereunder which shall be a bank or trust company organized and doing business
under the laws of the United States of America or of any State thereof,
authorized under such laws to exercise corporate trust powers, subject to
supervision or examination by Federal or State authority, having a combined
capital and surplus of at least $100,000,000, regularly engaged in or having
expertise in leveraged leasing. If such bank or trust company publishes reports
of condition at least annually, pursuant to applicable law or to the
requirements of the aforesaid supervising or examining authority, then for
purposes hereof the combined capital and surplus of such bank or trust company
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published.

          (d)  Any corporation into which the Corporate Indenture Trustee may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Corporate
Indenture Trustee shall be a party, or any corporation to which substantially
all the corporate trust business of the Corporate Indenture Trustee may be
transferred, shall, subject to the terms of paragraph (c) of this Section 8.02,
be the Corporate Indenture Trustee under this Indenture without further act.

          SECTION 8.03.  Co-Trustees and Separate Trustees. (a) In order to
comply with the provisions of La. R.S. 9:1783 and other provisions of Louisiana
law (to the extent the same may be applicable), the Corporate Indenture Trustee
and the Grantor Trustee hereby appoint Frederick W. Clark, a resident of the
State of New York, as the Individual Indenture Trustee hereunder. For such
purposes, the Individual Indenture Trustee shall act as mortgagee, assignee and
secured party solely with respect to that portion of the Indenture Estate
subject to the laws of the State of Louisiana and as to which the Corporate
Indenture Trustee is not qualified to act as mortgagee, assignee or secured
party under such laws (the "Louisiana Indenture Estate"). Further, if at any
time (i) the Grantor Trustee or any Holder shall have notified the Indenture
Trustee in writing that it shall be necessary or prudent in order to conform to
any law of any jurisdiction in which property shall be held subject to the Lien
of this Indenture, (ii) the Indenture Trustee shall be advised by counsel that
it is so necessary or prudent in the interest of the Holders, or (iii) a
Majority in Interest of Holders of Notes in writing shall so request the
Indenture Trustee and

                                       52
<PAGE>

the Grantor Trustee, in each case the Indenture Trustee and the Grantor Trustee
shall notify the Lessee in writing of such event and shall execute and deliver
all instruments and agreements necessary or proper either (x) to constitute
another bank or trust company or one or more Persons approved by the Indenture
Trustee and the Grantor Trustee, either to act as co-trustee or co-trustees of
all or any portion of the Indenture Estate, jointly with the Indenture Trustee
originally named herein or any successor or successors, or to act as separate
trustee or trustees of all or any such portion of the Indenture Estate in each
case with such rights, powers, duties and obligations as may be provided in such
supplemental indenture or such instrument of appointment as the Indenture
Trustee or a Majority in Interest of Holders of Notes may deem necessary or
advisable, or (y) to clarify, add to or subtract from the rights, powers, duties
and obligations theretofore granted any such additional or separate trustee,
subject in each case to the remaining provisions of this Section 8.03. In the
event that the Grantor Trustee shall not have joined in the execution of such
instruments and agreements within fifteen (15) days after the receipt of a
written request from the Indenture Trustee to do so, or if an Indenture Event of
Default shall have occurred and be continuing, the Indenture Trustee may act
under the foregoing provisions of this Section 8.03 without the concurrence of
the Grantor Trustee; and the Grantor Trustee hereby appoints the Indenture
Trustee its agent and attorney-in-fact to act for it under the foregoing
provisions of this Section 8.03(a) in either of such contingencies. The
Indenture Trustee may, in such capacity, execute, deliver and perform any such
supplemental indenture, or any such instrument, as may be required for the
appointment of any such co-trustee(s) or separate trustee(s) or for the
clarification of, addition to or subtraction from the rights, powers, duties or
obligations theretofore granted to any such co-trustee(s) or separate
trustee(s). In case any co-trustee(s) or separate trustee(s) appointed under
this Section 8.03(a) shall die, become incapable of acting, resign or be
removed, all the assets, property, rights, powers, trusts, duties and
obligations of such co-trustee(s) or separate trustee(s) shall revert to and
shall vest in and may be exercised by the Indenture Trustee, to the extent
permitted by law, until a successor, additional or separate trustee is appointed
as provided in this Section 8.03(a). The reasonable cost and expense of any
action taken by the Indenture Trustee or the Grantor Trustee pursuant to this
Section 8.03(a) shall be borne by the Lessee; provided that the Lessee has
received the notice referred to herein.

          (b)  The Individual Indenture Trustee shall accept the benefits of the
mortgages, assignments and security interest granted herein to the extent the
same cover and affect the Louisiana Indenture Estate and, in such capacity,
shall have full power and authority to foreclose the Lien hereof to the extent
the same covers and affects the Louisiana Indenture Estate subject to the terms
and provisions hereof; provided, further, that to the extent permitted from time
to time by Louisiana law, the Individual Indenture Trustee shall confer with and
obtain the concurrence of the Corporate Indenture Trustee prior to taking any
such action. Every other co-trustee and separate trustee hereunder and, to the
extent not inconsistent with the immediately preceding

                                       53
<PAGE>

sentence, the Individual Indenture Trustee, shall, to the extent permitted by
law and except as otherwise expressly provided in any Operative Document, be
appointed and act, and the Indenture Trustee and its successors shall act,
subject to the following provisions and conditions:

             (i)   the Secured Notes shall be authenticated and made available
     for delivery by the Corporate Indenture Trustee, and all powers, duties,
     obligations and rights conferred upon the Indenture Trustee in respect of
     the receipt, custody, control, payment and management of moneys, papers or
     securities, shall be exercised, solely by the Indenture Trustee;

             (ii)  all other rights, powers, duties and obligations conferred or
     imposed upon the Indenture Trustee shall be conferred or imposed upon and
     exercised or performed by the Indenture Trustee and such co-trustee or co-
     trustees or separate trustee or trustees jointly, except to the extent that
     under any applicable law or in any jurisdiction in which any particular act
     or acts are to be performed, the Indenture Trustee shall be incompetent or
     unqualified to perform such act or acts, in which event such rights,
     powers, duties and obligations shall be exercised and performed by such co-
     trustee or co-trustees or separate trustee or trustees; but subject to the
     same limitations in any exercise of his, her or its power and authority as
     those to which the Indenture Trustee is subject under the terms of this
     Indenture;

             (iii) notwithstanding anything herein contained to the contrary, no
     power given hereby to, or which it is provided hereby may be exercised by,
     any such co-trustee or co-trustees or separate trustee or trustees, except
     jointly with, or with consent in writing of, the Indenture Trustee;

             (iv)  no trustee hereunder shall be personally liable by reason of
     any act or omission of any other trustee hereunder;

             (v)   the powers of any co-trustee(s) or separate trustee(s)
     appointed pursuant to this Section 8.03 shall not in any case exceed those
     of the Indenture Trustee hereunder; and

             (vi)  the Grantor Trustee and the Indenture Trustee, at any time,
     by an instrument in writing executed by them jointly, may remove any such
     trustee, and in that case, by an instrument in writing executed by them
     jointly, may appoint a successor or successors to such co-trustee or co-
     trustees or separate trustee or trustees, as the case may be. In the event
     that the Grantor Trustee shall not have joined in the execution of any such
     instrument within fifteen (15) days after the receipt of a written request
     from the Indenture Trustee to do so, the Indenture Trustee shall have the
     power to remove any such co-trustee or separate

                                       54
<PAGE>

     trustee and to appoint a successor co-trustee or separate trustee without
     the concurrence of the Grantor Trustee. In the event that the Indenture
     Trustee alone shall have appointed a separate trustee or trustees or co-
     trustee or co-trustees as above provided in this Section 8.03, it may at
     any time, by an instrument in writing, remove any such separate trustee or
     co-trustee, the successor to any such separate trustee or co-trustee so
     removed to be appointed by the Grantor Trustee and the Indenture Trustee,
     or by the Indenture Trustee alone, as provided in this Section 8.03.

                                  ARTICLE IX

       SUPPLEMENTS AND AMENDMENTS TO THIS INDENTURE AND OTHER DOCUMENTS

          SECTION 9.01.  Indenture Supplements Without Consent of Holders. The
Grantor Trustee and the Indenture Trustee, without the consent of any Holder and
at any time and from time to time, may enter into one or more amendments or
supplements to this Indenture, in form satisfactory to each of the Grantor
Trustee and Indenture Trustee, for any of the following purposes:

          (a)  to subject to the Lien of this Indenture additional property
     constituting part of the Indenture Estate pursuant to a supplement to this
     Indenture;

          (b)  to correct or amplify the description of any property at any time
     subject to the Lien of this Indenture;

          (c)  to add to the covenants of the Grantor Trustee for the benefit of
     the Holders or to surrender any right or power herein conferred upon the
     Grantor Trustee, the Owner Participant or the Lessee;

          (d)  to cure any ambiguity, to correct or supplement any provision
     herein or in the Secured Notes which may be defective or inconsistent with
     any other provisions of this Indenture, provided that such action shall not
     adversely affect the interests of any Holder;

          (e)  to provide for the assumption by the Lessee of the obligations of
     the Grantor Trustee hereunder in accordance with the terms and conditions
     applicable thereto specified in Section 3.04, including without limitation,
     such amendments to Exhibit C as may be necessary or desirable in order to
     effectuate such assumption and accomplish the purposes thereof (provided
     that such amendments to Exhibit C shall not adversely affect the interests
     of the Loan Participants);

                                       55
<PAGE>

          (f)  to evidence the succession of a new Grantor Trustee in accordance
     with the Trust Agreement or the succession of a new Indenture Trustee
     hereunder or the appointment or removal of any co-trustee or separate
     trustee thereunder or hereunder;

          (g)  to convey, transfer, assign, mortgage or pledge any property to
     or with the Indenture Trustee or to make any other provisions with respect
     to matters or questions arising hereunder so long as such action shall not
     adversely affect the interests of the Loan Participants;

          (h)  to add to the rights of the Loan Participants;

          (i)  to include on the Secured Notes any legend as may be required by
     law; or

          (j)  to provide for the establishment and issuance of (i) Additional
     Notes pursuant to Section 14 of the Participation Agreement or Section 2.08
     or (ii) Refunding Secured Notes in connection with a refunding or
     refinancing pursuant to Section 15 of the Participation Agreement or
     Section 3.05.

          SECTION 9.02.  Supplements and Amendments to Indenture with Consent of
Holders of Notes. (a) Without the consent of a Majority in Interest of Holders
of Notes, the respective parties to the Trust Agreement and the Operative
Documents (other than the Tax Indemnity Agreement, the Letter of Credit and the
Reimbursement Agreement) may not modify, amend or supplement any of such
agreements, or give any consent, waiver, authorization or approval thereunder in
each case other than with respect to matters relating solely to Excepted
Payments, for the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions thereof or of modifying in any manner the
rights of the respective parties thereunder; provided, however, that the actions
specified in Section 9.02(c) may be taken without the consent of the Indenture
Trustee or any Holder.

          (b)  Except as provided in Section 9.01 or 9.02(c) or 9.02(d), at any
time and from time to time, with the consent of a Majority in Interest of
Holders of Notes and upon the written request of the Grantor Trustee, the
Indenture Trustee (x) shall execute an amendment or supplement to this Indenture
for the purpose of adding provisions to, or changing in any manner or
eliminating any of the provisions of, this Indenture, or (y) shall execute an
amendment or supplement to, or give a consent, waiver, authorization or
approval, for the purposes of adding any provisions to or changing in any manner
or eliminating any of the provisions of, the Participation Agreement, or (z)
shall consent to any amendment or supplement to, or give a consent, waiver,
authorization or approval, for the purposes of adding any provisions to or
changing in any manner or eliminating any of the provisions of, any of the other
Operative Documents; provided, however,

                                       56
<PAGE>

that no such amendment or supplement to this Indenture, or consent, waiver,
authorization, approval, amendment or supplement to the Participation Agreement
or any such other Operative Document (whether pursuant to subsection (a) or (c)
of this Section 9.02, and anything in such subsections or elsewhere in this
Indenture to the contrary notwithstanding) shall, without the consent of each
Holder of a Secured Note then Outstanding:

             (i)    change the stated maturity of the principal of, or any
     installment of interest on, or any mandatory or optional repayment,
     purchase or redemption provision with respect to, any Secured Note, or
     change the principal amount thereof or any other amount payable in respect
     thereof or reduce the Make-Whole Amount, if any, or interest thereon, or
     change the place of payment where, or the coin or currency in which, any
     Secured Note or the interest thereon is payable;

             (ii)   permit the creation of any Lien on the Indenture Estate not
     otherwise permitted hereunder or deprive any Holder of the benefit of the
     Lien of this Indenture upon the Indenture Estate, or any portion thereof,
     for the security of its Secured Notes;

             (iii)  change the percentage of the aggregate principal amount of
     Secured Notes required to take or approve any action hereunder or under any
     other Operative Document;

             (iv)   modify the definitions of "Indenture Default", "Indenture
     Event of Default", "Majority in Interest of Holders of Notes", "Lease
     Default" or "Lease Event of Default";

             (v)    modify the order of priorities in which distributions are to
     be made under Article IV;

             (vi)   reduce the amount or change the time of any payment of Basic
     Rent, Stipulated Loss Value, Early Buy-Out Purchase Price or Termination
     Value, except as expressly permitted pursuant to the terms of the Lease or
     the Participation Agreement as executed on the date hereof, so that such
     payments would be insufficient to pay principal of and interest on the
     outstanding Secured Notes as they become due hereunder, or change any of
     the circumstances under which Stipulated Loss Value, Early Buy-Out Purchase
     Price or Termination Value is payable or reduce the amount or change the
     time or any of the circumstances of payment of Supplemental Rent pursuant
     to Section 3.2(b) of the Lease;

             (vii)  [Intentionally Omitted];

             (viii) modify, amend or supplement any of the provisions of this
     Section 9.02;

                                       57
<PAGE>

             (ix)   modify, amend or supplement the Lease, or consent to any
     assignment of the Lease (other than an assignment pursuant to Section 14.2
     of the Lease), in either case releasing the Lessee from its obligations in
     respect of the payment of Basic Rent, Stipulated Loss Value, Early Buy-Out
     Purchase Price or Termination Value, or changing the absolute and
     unconditional character of such obligations as set forth in Section 3.6 of
     the Lease; or

             (x)    adversely affect any indemnities in favor of any Holder as
     provided pursuant to the terms of any Operative Document, except as may be
     consented to by each Person adversely affected thereby.

          (c)  Notwithstanding anything to the contrary contained in Section
9.02(b) (except as provided in the proviso to Section 9.02(b)), (x) without the
necessity of the consent of any of the Holders or the Indenture Trustee, the
Grantor Trustee may and (y) in the case of clauses (iii) and (iv) of this
Section 9.02(c), without the consent of any of the Holders, the Indenture
Trustee may:

             (i)    so long as no Indenture Event of Default shall have occurred
     and be continuing, modify, amend or supplement the Lease, or give any
     consent, waiver, authorization or approval with respect thereto, except
     that without compliance with Section 9.02(b), the Grantor Trustee shall not
     modify, amend or supplement, or give any consent, waiver, authorization or
     approval for the purposes of adding any provisions to or changing in any
     manner or eliminating any of the provisions thereof or of modifying in any
     manner the rights of the respective parties thereunder, with respect to the
     following provisions of the Lease as originally executed: Section 2 (if the
     result thereof would be to shorten the term of the Lease to a period
     shorter than the period ending with the maturity date of the Secured
     Notes), Section 3.1, 3.2, Section 3.3, Section 3.5, Section 3.6, Section 6,
     Section 7 (except that the procedures for soliciting bids may be modified
     and further restrictions may be imposed on the ability of the Lessee to
     terminate the Lease pursuant to such Section 7), Section 9.1, Section 10,
     Sections 11.1 through 11.7 (other than Section 11.5(c)), Section 12,
     Section 13 (except that additional insurance requirements may be imposed on
     the Lessee), Section 14, Section 15, Section 16, Section 18.1, Section 19.3
     and any definition of terms used in the Lease, to the extent that any
     modification of such definition would result in a modification of the Lease
     not permitted pursuant to this Section 9.02(b), provided that, subject to
     the next proviso, in the event an Indenture Event of Default shall have
     occurred and be continuing, the Indenture Trustee shall have all rights of
     the Grantor Trustee as "Lessor" under the Lease to modify, amend or
     supplement the Lease or give any consent, waiver, authorization or approval
     thereunder, for the

                                       58
<PAGE>

     purpose of adding any provisions to or changing in any manner or
     eliminating any of the provisions thereof or of modifying in any manner the
     rights of the "Lessor" thereunder; provided further that, without the prior
     consent of the Grantor Trustee and the Owner Participant, and subject to
     the Indenture Trustee's rights to exercise remedies under Section 16 of the
     Lease without the prior consent of the Grantor Trustee, whether or not an
     Indenture Event of Default shall have occurred and be continuing, no such
     action shall be taken with respect to any of the provisions of Sections 1
     (if any modification of a definition contained therein would result in a
     modification of the Lease not permitted by this proviso), 2, 3, 4, 5, 6, 7,
     8, 10, 11, 12, 13 (except to increase the amounts or types of insurance the
     Lessee must provide thereunder at its expense), 14, 15, 16, 17, 18 and 19
     of the Lease, or any other Section of the Lease to the extent such action
     shall affect the amount or timing of any amounts payable by the Lessee
     under the Lease as originally executed (or as subsequently modified with
     the consent of the Grantor Trustee) which, absent the occurrence and
     continuance of an Indenture Event of Default, would be distributable to the
     Grantor Trustee or the Owner Participant under Article IV;

             (ii)   modify, amend or supplement the Trust Agreement, or give any
     consent, waiver, authorization or approval with respect thereto, except
     that without compliance with Section 9.02(b), the Grantor Trustee shall not
     modify, amend or supplement, or give any consent, waiver, authorization or
     approval for the purpose of adding any provisions to or changing in any
     manner or eliminating any of the provisions thereof or of modifying in any
     manner the rights of the respective parties thereunder, with respect to the
     following provisions of the Trust Agreement as originally executed: Section
     1, Section 3.2, Section 3.3, Section 5.1, Section 9.1, Section 10, Section
     11.1, Section 12.7 and any definition of terms used in the Trust Agreement,
     to the extent that any modification of such definition would result in a
     modification of the Trust Agreement not permitted pursuant to this Section
     9.02(c), and in each case only to the extent any such action shall
     adversely impact the interests of the Holders;

             (iii)  modify, amend or supplement the Participation Agreement, or
     give any consent, waiver, authorization or approval with respect thereto,
     except that without compliance with Section 9.02(b), the Grantor Trustee
     and the Indenture Trustee shall not modify, amend or supplement, or give
     any consent, waiver, authorization or approval for the purpose of adding
     any provisions to or changing in any manner or eliminating any of the
     provisions thereof or of modifying in any manner the rights of the
     respective parties thereunder, with respect to the following provisions of
     the Participation Agreement as originally executed: Section 2, Section 3,
     Section 4, Section 5, Section 6, Section 8, Section 10 (other than an
     amendment to add to the covenants of the Lessee),

                                       59
<PAGE>

     Section 11.1, Section 11.2, Section 11.4, Section 11.6, Section 12 (insofar
     as such Section 12 relates to the Indenture Trustee, the Indenture Estate
     and the Holders) and, to the extent the Loan Participants would be
     adversely affected thereby, Section 15 and Section 16 and any definition of
     terms used in the Participation Agreement to the extent that any
     modification of such definition would result in a modification of the
     Participation Agreement not permitted pursuant to this Section 9.02(c); and

             (iv)   modify, amend or supplement any of said agreements in order
     to cure any ambiguity, to correct or supplement any provisions thereof
     which may be defective or inconsistent with any other provision thereof or
     of any provision of this Indenture, or to make any other provision with
     respect to matters or questions arising thereunder or under this Indenture
     which shall not be inconsistent with the provisions of this Indenture,
     provided the making of any such other provision shall not adversely affect
     the interests of the Holders unless such provision corrects a mistake or
     cures an ambiguity.

          (d)  The Indenture Trustee, without the consent of any Holder and at
any time and from time to time, may enter into one or more amendments or
supplements to the Participation Agreement, in form satisfactory to the
Indenture Trustee, for any of the following purposes:

             (i)    to add to the covenants of any other party thereto for the
     benefit of the Indenture Trustee or the Holders or to surrender any right
     or power therein conferred upon any other party thereto;

             (ii)   to cure any ambiguity, or to correct or supplement any
     provision therein which may be defective or inconsistent with any other
     provisions thereof, provided that such action shall not adversely affect
     the interest of any Holder;

             (iii)  to provide for the assumption by the Lessee of the
     obligations of the Grantor Trustee under this Indenture in accordance with
     the terms and conditions applicable thereto specified in Section 3.04,
     including without limitation, such amendments to Exhibit C to this
     Indenture or the Participation Agreement as may be necessary or desirable
     in order to effectuate such assumption and accomplish the purposes thereof
     (provided that such amendments to such Exhibit C or the Participation
     Agreement shall not adversely affect the interests of the Loan
     Participants);

             (iv)   to evidence the succession of a new Grantor Trustee in
     accordance with the Trust Agreement or the succession of a new Indenture
     Trustee hereunder or the appointment or removal of any co-trustee or
     separate trustee thereunder or hereunder;

                                       60
<PAGE>

             (v)    to make any other provisions with respect to matters or
     questions arising under the Participation Agreement so long as such action
     shall not adversely affect the interests of the Loan Participants;

             (vi)   to add to the rights of the Indenture Trustee or the
     Holders; or

             (vii)  to provide for the establishment and issuance of (1)
     Additional Notes pursuant to Section 14 of the Participation Agreement or
     Section 2.08 or (2) Refunding Secured Notes in connection with a refunding
     or refinancing pursuant to Section 15 of the Participation Agreement or
     Section 3.05.

          (e)  It shall not be necessary for Holders to approve the particular
form of any proposed amendment or supplement to this Indenture, or any
amendment, consent, waiver or other modification of any other Operative
Document, but it shall be sufficient if such action shall approve the substance
thereof.

          SECTION 9.03.  Execution of Indenture Supplement, Amendments, Etc. In
executing or accepting the additional trusts created by any amendment or
supplement to this Indenture, or any amendment, consent, waiver or other
modification permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, each of the Indenture Trustee and the Grantor
Trustee shall be entitled to receive, and (subject to Section 6.01 and Section
6.02) shall be fully protected in relying upon, an opinion of independent
counsel stating that the execution of such amendment or supplement to this
Indenture, or of such amendment, consent, waiver or modification, is authorized
or permitted by this Indenture. Either of the Indenture Trustee or the Grantor
Trustee may, but shall not be obligated to, enter into any such amendment or
supplement to this Indenture which affects its own rights, duties or immunities
under this Indenture or otherwise.

          SECTION 9.04.  Effect of Indenture Supplement. Upon the execution of
any amendment or supplement to this Indenture pursuant to this Article IX, this
Indenture shall be modified in accordance therewith, and such amendment or
supplement shall form a part of this Indenture for all purposes; and every
Holder of a Secured Note theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.

          SECTION 9.05.  Reference in Secured Notes to Indenture Supplements.
Secured Notes authenticated and delivered after the execution of any amendment
or supplement pursuant to this Article IX may, and shall if required by the
Indenture Trustee, bear a notation in form approved by the Indenture Trustee as
to any matter provided for in such amendment or supplement. If the amendment or
supplement to this Indenture shall so provide, new Secured Notes so modified as
to conform,

                                       61
<PAGE>

in the opinion of the Indenture Trustee and the Grantor Trustee, to any such
amendment or supplement may be prepared and executed by the Grantor Trustee and
authenticated and delivered by the Corporate Indenture Trustee in exchange for
outstanding Secured Notes.

          SECTION 9.06.   Notices of Indenture Supplements and Amendments, Etc.
Promptly after the execution by the Grantor Trustee and the Indenture Trustee of
any amendment or supplement to this Indenture, or any amendment, consent, waiver
or other modification pursuant to the provisions hereof, the Indenture Trustee
shall send a conformed copy of such instrument to each Holder, the Lessee, the
Grantor Trustee and the Owner Participant but the failure of the Indenture
Trustee to send such a conformed copy shall not impair or affect the validity of
such document.

          SECTION 9.07.   Lessee Rights. Without the consent of the Lessee, no
amendment or supplement to this Indenture or amendment, waiver or other
modification of any provision of this Indenture shall alter or modify the
provisions of Section 5.09 or this Section 9.07.

                                   ARTICLE X

                                 MISCELLANEOUS

          SECTION 10.01.  Termination of Indenture. This Indenture and the
trusts created hereby shall terminate, and this Indenture shall be of no further
force or effect, upon the payment in full of the principal of and interest on
and all other amounts due and payable under all Secured Notes and all other
amounts due and payable to any Holder or the Indenture Trustee hereunder or, to
the extent secured hereby, under any other Operative Document. The foregoing
shall not impair any rights of a Holder in respect of indemnification or other
claims which may be available against any party under the terms of any other
Operative Document. Except as otherwise provided in the preceding sentence, this
Indenture and the trusts created hereby shall continue in full force and effect
in accordance with the terms hereof.

          SECTION 10.02.  No Legal Title to Indenture Estate in Holders. No
Holder shall have legal title to any part of the Indenture Estate. No transfer,
by operation of law or otherwise, of any Secured Note or other right, title and
interest of any Holder in and to the Indenture Estate or hereunder shall operate
to terminate this Indenture or entitle such Holder or any successor or
transferee of such Holder to an accounting or to the transfer to it of any legal
title to any part of the Indenture Estate.

          SECTION 10.03.  Power of Attorney. The Grantor Trustee does hereby
constitute the Indenture Trustee its true and lawful attorney-in-fact,
irrevocably and coupled with the interest of the Indenture Trustee created by
this Indenture, so long as any Secured Notes are

                                       62
<PAGE>

Outstanding and so long as there are any other amounts due hereunder, under any
other Operative Documents, or under the Secured Notes, with full power (in the
name of and as attorney-in-fact for the Grantor Trustee or otherwise) to ask
for, require, demand and receive any and all moneys and claims for moneys, and
all other property, which now or hereafter constitutes part of the Indenture
Estate, to endorse any checks or other instruments or orders in connection
therewith and, to the extent permitted or contemplated by the Indenture or the
other Operative Documents, to file any claims or to take any action, or to
institute any proceedings, which the Indenture Trustee may deem to be necessary
or advisable in the premises. The Grantor Trustee has directed the Indenture
Trustee to make all necessary conveyances, assignments, transfers and deliveries
of the Indenture Estate and any rights hereunder pursuant to the provisions of
this Indenture, and for that purpose the Indenture Trustee may execute all
necessary instruments of conveyance, assignment and transfer, and may substitute
one or more persons with like power, and the Grantor Trustee hereby ratifies and
confirms all that the Indenture Trustee, acting as its attorney, or any such
substitute, shall lawfully do by virtue hereof and whether pursuant to the
exercise of any remedies hereunder or otherwise.

          SECTION 10.04.  Regarding the Grantor Trustee. (a) Except as expressly
provided herein, all and each of the representations, warranties, undertakings
and agreements herein made on the part of the Grantor Trustee are made and
intended not as personal representations, warranties, undertakings and
agreements by or for the purpose or with the intention of binding the Grantor
Trustee personally but are made and intended for the purpose of binding only the
Trust Estate (including the Louisiana Trust Estate), and this Indenture is
executed and delivered by the Grantor Trustee solely in the exercise of the
powers expressly conferred upon it as trustee under the Trust Agreement; and no
personal liability or responsibility is assumed hereunder by, or at any time
shall be enforceable against, the Grantor Trustee or any successor in trust on
account of any representation, warranty, undertaking or agreement hereunder of
the Grantor Trustee, either expressed or implied, all such personal liability,
if any, being expressly waived by the Indenture Trustee; provided, however, that
(a) the Indenture Trustee or any Person claiming by, through or under it, making
claim hereunder, may subject to the terms and conditions hereof, look to the
Indenture Estate for satisfaction of such liability or responsibility and (b)
the Corporate Grantor Trustee and the Individual Grantor Trustee or its
respective successor in trust, as applicable, shall be personally liable,
jointly and severally, for its own and the Individual Grantor Trustee's gross
negligence and willful misconduct and for the matters described in clauses (i)
through (v) of the last sentence of Section 7.1 of the Trust Agreement. Subject
to the terms and conditions hereof, each time a successor Grantor Trustee is
appointed in accordance with the terms of the Trust Agreement, such successor
Grantor Trustee shall, without further act, succeed to all the rights, duties,
immunities and obligations of its predecessor Grantor Trustee hereunder and
under the other Operative Documents, and the predecessor Grantor Trustee shall
be released from all

                                       63
<PAGE>

further duties and obligations hereunder and under the other Operative
Documents, all without the necessity of any consent or approval by the Indenture
Trustee and without in any way altering the terms of this Indenture or such
other Operative Documents or the obligations of the Indenture Trustee hereunder
or thereunder.

          (b)  As to the aggregate unpaid principal amount of Secured Notes
Outstanding as of any date, the Grantor Trustee may rely on an Officer's
Certificate of the Corporate Indenture Trustee.

          SECTION 10.05.  Notices. All communications, notices and consents
provided for in this Indenture shall be in writing and shall be given in the
manner, and shall become effective in accordance with Section 17.3 of the
Participation Agreement.

          SECTION 10.06.  Severability of Provisions. Any provision of this
Indenture which may be determined by competent authority to be invalid or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such invalidity or unenforceability without invalidating or
rendering unenforceable any remaining terms and provisions hereof, and any such
invalidity or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. The parties shall
negotiate in good faith to replace such provision with an appropriate legal
provision. To the extent permitted by applicable law, the parties hereto waive
any provision thereof that renders any term or provision hereof invalid or
unenforceable in any respect.

          SECTION 10.07.  No Oral Modification or Continuing Waivers. No term or
provision of this Indenture or the Secured Notes may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party or the person against whom enforcement of the change, waiver,
discharge or termination is sought; and any waiver of the terms hereof or of any
Secured Note shall be effective only in the specific instance and for the
specific purpose given.

          SECTION 10.08.  Successors and Assigns. All covenants and agreements
contained herein shall be binding upon each of the parties hereto and their
respective successors and permitted assigns, and inure to the benefit of each of
the parties hereto and their respective successors and permitted assigns, all as
herein provided. Any request, notice, direction, consent, waiver or other
instrument or action by any Holder shall bind the successors and assigns of such
Holder. This Indenture and the Indenture Estate shall not be affected by any
amendment or supplement to the Trust Agreement or by any other action taken
under or in respect of the Trust Agreement, except as otherwise provided in or
permitted by this Indenture. Each Holder by its acceptance of a Secured Note
agrees to be bound by this Indenture and all provisions of the Operative
Documents applicable to it.

                                       64
<PAGE>

          SECTION 10.09.  Headings; Table of Contents. The division of this
Indenture into Articles, Sections, subsections and paragraphs, the provision of
a table of contents and the insertion of headings are for convenience of
reference only and shall not affect the construction or interpretation hereof.

          SECTION 10.10.  Normal Commercial Relations. Notwithstanding anything
contained in this Indenture to the contrary, any Participant, the Indenture
Trustee, the Grantor Trustee, or bank or other affiliate of any such Person may
conduct any banking or other financial transactions and have banking or other
commercial relationships with the Lessee, fully to the same extent as if this
Indenture were not in effect.

          SECTION 10.11.  Governing Law. THIS INDENTURE SHALL BE GOVERNED BY,
AND SHALL BE CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES EXCEPT TO THE EXTENT THAT
THE INTERNAL LAWS OF ANY OTHER JURISDICTION MAY BE MANDATORILY APPLICABLE.

          SECTION 10.12.  Execution. This Indenture may be executed in separate
counterparts by the parties hereto, each of which, when so executed and
delivered, shall be an original, but all such counterparts shall together
constitute but one and the same instrument.

          SECTION 10.13.  Security Agreement. This Indenture shall constitute a
security agreement and, in addition to all other rights of the Indenture Trustee
hereunder, the Indenture Trustee shall have for the benefit of the Holders all
of the rights conferred upon secured parties by the UCC and any other similar
legislation as from time to time in effect in any applicable jurisdiction.

          SECTION 10.14.  Benefits of Indenture. Nothing in this Indenture,
whether express or implied, shall be construed to give to any Person other than
the parties hereto, the Holders and (to the extent expressly provided herein)
the Owner Participant any legal or equitable right, remedy or claim under or in
respect of this Indenture or the Secured Notes, and this Indenture shall be held
for the sole and exclusive benefit of the parties hereto, the Holders and (to
the extent expressly provided herein) the Owner Participant.

          SECTION 10.15.  Personal Property. Notwithstanding the recording of
this Indenture in the mortgage records of St. Mary Parishes, Louisiana, it is
intended by the parties hereto that, the Undivided Interest and every portion
thereof is moveable or personal property, and shall remain moveable or personal
property, to the maximum extent permitted by law. To the maximum extent
permitted by law, the parties agree that the Undivided Interest shall constitute
moveable or personal

                                       65
<PAGE>

property and shall not become fixtures or otherwise become part of the real
estate or immovable property underneath the Production System.

          SECTION 10.16.  Individual Indenture Trustee. The Individual Indenture
Trustee signs this Indenture to accept the duties and responsibility granted
hereunder.

          SECTION 10.17.  Special Louisiana Provisions.

          (a)  The assignment of Lease and Rent provided in this Indenture is
made pursuant to La. R.S. 9:4401 et seq.

          (b)  Pursuant to the provisions of La. R.S. 9:5301 et seq., each of
the Holders has appointed the Indenture Trustee as agent, fiduciary and
mortgagee in the exercise of all of the Holder's rights and remedies under this
Indenture.

          (c)  The Secured Notes and other Indenture Indebtedness have not been
paraphed for identification with this Indenture.

          (d)  The taxpayer identification number of the Corporate Grantor
Trustee is 51-6506274, and the taxpayer identification number of the Individual
Grantor Trustee is 221-228535.  The taxpayer identification number of the
Corporate Indenture Trustee is 13-5160382 and the taxpayer identification number
of the Individual Indenture Trustee is 156-343716.

          (e)  The maximum amount of the Indenture Indebtedness that this
Indenture (including the assignment of Lease and Rent contained herein) secures
that may be outstanding at any time and from time to time is fixed at
$1,000,000,000, and the maximum amount which the Indenture Trustee or the
Holders may claim for damages that the Indenture Trustee or the Holders may
suffer from a breach of any covenant, condition or agreement secured by this
Indenture (other than for the payment of money) is fixed at $1,000,000,000.

          (f)  For purposes of executory process, the Grantor Trustee
acknowledges the Indenture Indebtedness secured hereby, whether now existing or
to arise hereafter, and confesses judgment thereon if not paid when due.  Upon
the occurrence of an Indenture Event of Default and at any time thereafter so
long as the same shall be continuing, and, so long as the Indenture Trustee has
complied with all of its obligations hereunder, including those set forth in
Section 5.04, in addition to all other rights and remedies granted to the
Indenture Trustee hereunder, it shall be lawful for and the Grantor Trustee
hereby authorizes the Indenture Trustee, without making a demand or putting the
Grantor Trustee into default, such putting in default being expressly waived, to
cause all and singular the Indenture Estate to be seized and sold after due
process of law, the Grantor Trustee waiving the benefit of any and all laws or
parts of laws relative to appraisement of property seized and sold under
executory process or other legal process, and consenting that the

                                       66
<PAGE>

Indenture Estate be sold without appraisement, either in its entirety or in lots
or parcels, as the Indenture Trustee may determine, to the highest bidder for
cash or on such other terms as the Indenture Trustee in such proceeding may
direct. The Indenture Trustee shall be granted all rights and remedies granted a
mortgagee or secured party under applicable Louisiana law, including the Uniform
Commercial Code in effect in the State of Louisiana.

          (g)  The Grantor Trustee hereby waives: (i) the benefit of
appraisement provided for in articles 2332, 2336, 2723 and 2724 of the Louisiana
Code of Civil Procedure and all other laws conferring the same; (ii) the demand
and three days notice of demand as provided in articles 2629 and 2721 of the
Louisiana Code of Civil Procedure; and (iii) the three days delay provided for
in articles 2331 and 2722 of the Louisiana Code of Civil Procedure.

                                       67
<PAGE>

          THUS DONE AND PASSED on this 22 day of November, 1996, but effective
for all purposes as of November 15, 1996, before me, the undersigned Notary
Public, in and for the County of New York, State of New York, and in the
presence of the undersigned competent witnesses, who have hereunto signed their
names with the Corporate Grantor Trustee, the Individual Grantor Trustee, the
Corporate Indenture Trustee, the Individual Indenture Trustee and me, said
Notary, after reading of the whole.

WITNESSES TO ALL SIGNATURES:            WILMINGTON TRUST COMPANY, not
                                        in its individual capacity, except as
                                        expressly provided herein, but solely
                                        as Corporate Grantor Trustee

                                        /s/ James P. Lawler
                                        ----------------------------------------
                                        By:  James P. Lawler
                                        Its: Vice President

                                        THOMAS P. LASKARIS, not in his
                                        individual capacity, except as
                                        expressly provided herein, but solely
                                        as Individual Grantor Trustee

                                        /s/ Thomas P. Laskaris
                                        ----------------------------------------
                                        Thomas P. Laskaris

                                        THE BANK OF NEW YORK, not in its
                                        individual capacity, except as
                                        expressly provided herein, but solely
                                        as Corporate Indenture Trustee

                                        /s/ Stephen J. Giurlando
                                        ----------------------------------------
                                        By:  Stephen J. Giurlando
                                        Its: Assistant Vice President

                                        FREDERICK W. CLARK, not in his
                                        individual capacity, except as
                                        expressly provided herein, but solely
                                        as Individual Indenture Trustee

                                        /s/ Frederick W. Clark
                                        ----------------------------------------
                                        Frederick W. Clark

                                       68
<PAGE>

WITNESSES:

/s/ Deepak Ghosh
-------------------------------
Name: Deepak Ghosh

/s/ Chris R. Becker                     NOTARY PUBLIC
-------------------------------
Name: Chris R. Becker                   Name: /s/ Elizabeth Casagrande
                                              ----------------------------------

[NOTARY SEAL]                           My Commission Expires:

                                                Elizabeth Casagrande
                                          Notary Public, State of New York
                                                   No. 43-4975014
                                            Qualified in Richmond County
                                        Certificate Filed in New York County
                                          Commission Expires Nov. 26, 1996

                                       69<PAGE>

                                                                    Exhibit 10.2
================================================================================

                           ENSERCH EXPLORATION, INC.

                                      and

                             THE BANK OF NEW YORK,

                                  as Trustee

                         PASS THROUGH TRUST AGREEMENT

                         Dated as of November 15, 1996

                                 $178,320,000
                                  -----------
                           Enserch Exploration, Inc.
                            1996 Pass Through Trust
                       7.54% Pass Through Certificates,
                                  Series 1996

================================================================================
<PAGE>

                               TABLE OF CONTENTS
                               -----------------
<TABLE>
<CAPTION>
                                                                                            Page
                                                                                            ----
<S>                                                                                           <C>
ARTICLE I DEFINITIONS                                                                          2

     Section 1.01.  Definitions                                                                2
     Section 1.02.  Compliance Certificates and Opinions                                      15
     Section 1.03.  Form of Documents Delivered to Trustee                                    16
     Section 1.04.  Acts of Holders                                                           17

ARTICLE II ACQUISITION OF SECURED NOTES; ORIGINAL ISSUANCE OF CERTIFICATES                    18

     Section 2.01.  Issuance of Certificates; Acquisition of Secured Notes                    18
     Section 2.02.  Acceptance by Trustee                                                     19
     Section 2.03.  Limitation of Powers                                                      19

ARTICLE III THE CERTIFICATES                                                                  20

     Section 3.01.  Form, Denomination and Execution of Certificates                          20
     Section 3.02.  Authentication of Certificates                                            24
     Section 3.03.  Temporary Certificates                                                    25
     Section 3.04.  Registration of Transfer and Exchange of Certificates                     25
     Section 3.05.  Mutilated, Destroyed, Lost or Stolen Certificates                         26
     Section 3.06.  Persons Deemed Owners                                                     27
     Section 3.07.  Cancellation                                                              27
     Section 3.08.  Limitation of Liability for Payments                                      27
     Section 3.09.  Book-Entry Provisions for Global Certificates                             28
     Section 3.10.  Restrictions on Transfer and Exchange of Certificates                     30
     Section 3.11.  CUSIP Numbers                                                             36

ARTICLE IV DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS                                    36

     Section 4.01.  Certificate Account and Special Payments Account                          36
     Section 4.02.  Distributions from Certificate Account and Special Payments Account       37
     Section 4.03.  Statements to Certificateholders                                          39
     Section 4.04.  Investment of Special Payment Moneys                                      40
</TABLE>

                                       i
<PAGE>

<TABLE>
<CAPTION>
                                                                                                    Page
                                                                                                    ----
<S>                                                                                                 <C>
ARTICLE V  ENSERCH EXPLORATION                                                                        40

     Section 5.01.  Maintenance of Corporate Existence                                                40
     Section 5.02.  Consolidation, Merger or Sale of Assets Permitted                                 41
     Section 5.03.  Annual Statements as to Compliance by Enserch Exploration                         41
     Section 5.04.  Availability of Certain Information Concerning Enserch Exploration                42
     Section 5.05.  Notification of Certain Enserch Exploration Acquisitions of Certificates          42
     Section 5.06.  Representations and Warranties of Enserch Exploration                             42

ARTICLE VI DEFAULT                                                                                    44

     Section 6.01.  Events of Default                                                                 44
     Section 6.02.  Incidents of Sale of Secured Notes                                                45
     Section 6.03.  Judicial Proceedings Instituted by Trustee                                        46
     Section 6.04.  Control by Certificateholders                                                     47
     Section 6.05.  Waiver of Defaults                                                                48
     Section 6.06.  Undertaking to Pay Court Costs                                                    48
     Section 6.07.  Right of Certificateholders to Receive Payments Not to Be Impaired                49
     Section 6.08.  Certificateholders May Not Bring Suit Except Under Certain Conditions             49
     Section 6.09.  Remedies Cumulative                                                               50

ARTICLE VII THE TRUSTEE                                                                               51

     Section 7.01.  Certain Duties and Responsibilities                                               51
     Section 7.02.  Notice of Defaults                                                                52
     Section 7.03.  Certain Rights of Trustee                                                         53
     Section 7.04.  Not Responsible for Recitals or Issuance of Certificates                          54
     Section 7.05.  May Hold Certificates                                                             54
     Section 7.06.  Money Held in Trust                                                               54
     Section 7.07.  Compensation and Reimbursement                                                    54
     Section 7.08.  Corporate Trustee Required; Eligibility                                           56
     Section 7.09.  Resignation and Removal; Appointment of Successor                                 56
     Section 7.10.  Acceptance of Appointment by Successor                                            58
     Section 7.11.  Merger, Conversion, Consolidation or Succession to Business                       59
     Section 7.12.  Maintenance of Agencies                                                           60
</TABLE>

                                      ii
<PAGE>

<TABLE>
<CAPTION>
                                                                                                           Page
                                                                                                           ----
<S>                                                                                                       <C>
     Section 7.13.  Money for Certificate Payments to Be Held in Trust                                       61
     Section 7.14.  Registration of Secured Notes in Trustee's Name                                          62
     Section 7.15.  Representations and Warranties of Trustee                                                62
     Section 7.16.  Withholding Taxes; Information Reporting                                                 63
     Section 7.17.  Trustee's Liens                                                                          64
     Section 7.18.  Availability of Certain Information Concerning the Trust                                 64

ARTICLE VIII CERTIFICATEHOLDERS' LISTS AND REPORTS BY TRUSTEE                                                65

     Section 8.01.  Enserch Exploration to Furnish Trustee with Names and Addresses of
                        Certificateholders                                                                   65
     Section 8.02.  Preservation of Information; Communication to Certificateholders                         65
     Section 8.03.  Reports by Enserch Exploration                                                           67

ARTICLE IX SUPPLEMENTAL TRUST AGREEMENTS                                                                     67

     Section 9.01.  Supplemental Trust Agreement Without Consent of Certificateholders                       67
     Section 9.02.  Supplemental Trust Agreements with Consent of Certificateholders                         68
     Section 9.03.  Documents Affecting Immunity or Indemnity                                                69
     Section 9.04.  Execution of Supplemental Trust Agreements                                               69
     Section 9.05.  Effect of Supplemental Trust Agreements                                                  70
     Section 9.06.  Reference in Certificates to Supplemental Trust Agreements                               70

ARTICLE X AMENDMENTS TO INDENTURES AND NOTE DOCUMENTS                                                        70

     Section 10.01.  Amendments and Supplements to Indenture and Other Note Documents                        70

ARTICLE XI TERMINATION OF TRUST                                                                              71

     Section 11.01.  Termination of the Trust                                                                71
</TABLE>

                                      iii
<PAGE>

<TABLE>
<CAPTION>
                                                                                                           Page
                                                                                                           ----
<S>                                                                                                        <C>
ARTICLE XII MISCELLANEOUS PROVISIONS                                                                         73

     Section 12.01.  Limitation on Rights of Certificateholders                                              73
     Section 12.02.  Certificates Nonassessable and Fully Paid                                               73
     Section 12.03.  Notices                                                                                 73
     Section 12.04.  Governing Law                                                                           74
     Section 12.05.  Severability of Provisions                                                              74
     Section 12.06.  Effect of Headings and Table of Contents                                                74
     Section 12.07.  Successors and Assigns                                                                  74
     Section 12.08.  Benefits of Trust Agreement                                                             74
     Section 12.09.  Legal Holidays                                                                          75
     Section 12.10.  Counterparts                                                                            75
</TABLE>

                                      iv
<PAGE>

EXHIBIT A -    Form of Pass Through Certificate

EXHIBIT B -    Form of Regulation S Transfer Restriction Certificate

EXHIBIT C -    Form of DTC Letter of Representations

EXHIBIT D -    Form of Certificate to be Delivered in Connection with Transfers
                 Pursuant to Regulation S

EXHIBIT E -    Form of Transfer Certificate for Restricted Securities

EXHIBIT F -    Form of Accredited Investor Letter

Schedule 1 -   Form of Secured Notes (1996-A) to be Purchased

Schedule 2 -   Form of Secured Notes (1996-B) to be Purchased

                                       v
<PAGE>

          This PASS THROUGH TRUST AGREEMENT, as it may be amended, supplemented
or otherwise modified from time to time (the "Trust Agreement"), dated as of
                                              ---------------
November 15, 1996 is made with respect to the formation of the Enserch
Exploration 1996 Pass Through Trust, between Enserch Exploration, Inc., a Texas
corporation ("Enserch Exploration"), and The Bank of New York, a New York
              -------------------
banking corporation, as Trustee.

                             W I T N E S S E T H :
                             - - - - - - - - - -

          WHEREAS, the Grantor Trustees (as such term and certain other
capitalized terms used herein are defined below), acting on behalf of the Owner
Participants, will lease the Undivided Interests from Enserch Holdings pursuant
to the Head Leases;

          WHEREAS, the Grantor Trustees will issue, on a non-recourse basis,
Secured Notes under the Indentures in order to pay Enserch Holdings its
consideration under the Head Leases;

          WHEREAS, Enserch Exploration is contemporaneously herewith purchasing
all right, title and interest of Enserch Holdings in and to the Head Leases
pursuant to the Assignment and Assumption and Security Agreements;

          WHEREAS, the Grantor Trustees will sublease the Undivided Interests to
Enserch Exploration pursuant to the Lease Transactions;

          WHEREAS, pursuant to the terms and conditions of this Trust Agreement
and the Participation Agreements to be entered into by the Trustee
simultaneously with the execution and delivery of this Trust Agreement, the
Secured Notes are to be sold to the Trustee by each of the Grantor Trustees, and
the Trustee shall purchase the Secured Notes and shall hold the Secured Notes in
trust for the benefit of the Certificateholders;

          WHEREAS, the Trustee, upon the execution and delivery of this Trust
Agreement, hereby declares the creation of this Trust for the benefit of the
Certificateholders, and the initial Certificateholders as the grantors of the
Trust and by their respective acceptances of the Certificates join in the
creation of this Trust with the Trustee; and

          WHEREAS, to facilitate the sale of the Secured Notes to the Trustee
and the purchase of the Secured Notes by the Trustee, Enserch Exploration is
undertaking to perform certain administrative and ministerial duties hereunder
and is also undertaking to pay the fees and expenses of the Trustee.
<PAGE>

          NOW, THEREFORE, in consideration of the mutual agreements herein
contained, and of the other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:

                                   ARTICLE I

                                  DEFINITIONS

          Section 1.01.  Definitions.  (a)  For all purposes of this Trust
                         -----------
Agreement, except as otherwise expressly provided or unless the context
otherwise requires:

          (1)  the terms used herein that are defined in this Article have the
     meanings assigned to them in this Article, and include the plural as well
     as the singular;

          (2)  all references in this Trust Agreement to designated "Articles",
     "Sections" and other subdivisions are to the designated Articles, Sections
     and other subdivisions of this Trust Agreement; and

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

          (b)  For all purposes of this Trust Agreement, the following
capitalized terms have the following respective meanings:

          "Act":  when used with respect to any Holder, has the meaning
           ---
     specified in Section 1.04.

          "Affiliate":  of any specified Person, means any other Person which
           ---------
     directly or indirectly controls or is controlled by, or is under common
     control with, such specified Person.  For the purposes of this definition,
     "control" means the possession, directly or indirectly, of the power to
     direct or cause the direction of the management and policies of such
     Person, whether through the ownership of voting securities, by contract or
     otherwise; and the terms "controlling" and "controlled" have meanings
     correlative to the foregoing.

          "Agent Member":  has the meaning specified in Section 3.09.
           ------------

          "Applicable Procedures":  has the meaning specified in Section 3.10.
           ---------------------

                                       2
<PAGE>

          "Assignment and Assumption and Security Agreements":  means,
           -------------------------------------------------
     collectively, the Assignment and Assumption Agreement, Mortgage and
     Security Agreement (1996-A) dated as of November 15, 1996 between Enserch
     Holdings and Enserch Exploration and the Assignment and Assumption
     Agreement, Mortgage and Security Agreement (1996-B) dated as of November
     15, 1996 between Enserch Holdings and Enserch Exploration.

          "Authorized Agent":  means any Paying Agent or Registrar.
           ----------------

          "Business Day":  means any day other than a Saturday, a Sunday, or a
           ------------
     day on which commercial banking institutions are authorized or obligated by
     law, executive order, or governmental decree to be closed in New York, New
     York, the city and state in which the Corporate Trust Office of the
     Indenture Trustee is located or the city and state in which the Corporate
     Trust Office of the Trustee is located.

          "Cedel":  has the meaning specified in Section 3.01(f).
           -----

          "Certificate":  means any one of the certificates executed and
           -----------
     authenticated by the Trustee, substantially in the form of Exhibit A
     hereto.

          "Certificate Account (1996-A)":  has the meaning assigned to such term
           ----------------------------
     in Section 4.01(a).

          "Certificate Account (1996-B)":  has the meaning assigned to such term
           ----------------------------
     in Section 4.01(a).

          "Certificate Accounts":  means, collectively, the Certificate Account
           --------------------
     (1996-A) and the Certificate Account (1996-B).

          "Certificateholder or Holder":  means the Person in whose name a
           ---------------------------
     Certificate is registered in the Register.

          "Closing Date":  has the meaning specified in Section 2.4 of the
           ------------
     Participation Agreements.

          "Commission":  means the Securities and Exchange Commission, as from
           ----------
     time to time constituted, created under the Securities Exchange Act of
     1934.

          "Consideration":  has the meaning specified in Section 2.01.
           -------------

                                       3
<PAGE>

          "Corporate Trust Office":  with respect to the Trustee, the Grantor
           ----------------------
     Trustees and the Indenture Trustee, means the office of such trustee in the
     city at which at any particular time its corporate trust business shall be
     principally administered.

          "Default":  means any event which is, or after notice or lapse of time
           -------
     or both would become, an Event of Default.

          "Depository":  means an organization registered as a "clearing agency"
           ----------
     pursuant to Section 17A of the Securities Exchange Act of 1934, as amended.

          "Direction":  has the meaning specified in Section 1.04(c).
           ---------

          "Distribution Date":  with respect to distributions of Scheduled
           -----------------
     Payments, means each January 2 and July 2, commencing January 2, 1997 until
     payment of all the Scheduled Payments to be made under the Secured Notes
     has been made.

          "DTC":  means The Depository Trust Company and any successor
           ---
     Depository.

          "Enserch Exploration":  means Enserch Exploration, Inc., a Texas
           -------------------
     corporation, or its successor in interest pursuant to Section 5.02.

          "Enserch Holdings":  means Enserch Exploration Holdings, Inc., a
           ----------------
     Delaware corporation.

          "Euroclear":  has the meaning specified in Section 3.01.
           ---------

          "Event of Default":  means, collectively, an Indenture Event of
           ----------------
     Default (1996-A) and an Indenture Event of Default (1996-B).

          "Fractional Undivided Interest":  means the fractional undivided
           -----------------------------
     interest in the Trust that is evidenced by a Certificate.

          "Global Certificate":  means the Restricted Global Certificate, any
           ------------------
     Regulation S Global Certificate and any Unrestricted Global Certificate.

          "Grantor Trustee (1996-A)":  means Wilmington Trust Company, not in
           ------------------------
     its individual capacity but solely as Corporate Grantor Trustee and Thomas
     P. Laskaris, not in his individual capacity but solely as Individual
     Grantor Trustee, collectively, under the Trust Agreement (1996-A) dated as
     of November 15,

                                       4
<PAGE>

     1996, between Wilmington Trust Company and the Owner Participant (1996-A);
     and any successor to the Grantor Trustee (1996-A) as such trustee.

          "Grantor Trustee (1996-B)":  means Wilmington Trust Company, not in
           ------------------------
     its individual capacity but solely as Corporate Grantor Trustee and Thomas
     P. Laskaris, not in his individual capacity but solely as Individual
     Grantor Trustee, collectively, under the Trust Agreement (1996-B) dated as
     of November 15, 1996, between Wilmington Trust Company and the Owner
     Participant (1996-B); and any successor to the Grantor Trustee (1996-B) as
     such trustee.

          "Grantor Trustees":  means, collectively, the Grantor Trustee (1996-A)
           ----------------
     and the Grantor Trustee (1996-B).

          "Head Lease (1996-A)":  means the Head Lease Agreement (1996-A) dated
           -------------------
     as of November 15, 1996, between Enserch Exploration and the Grantor
     Trustee (1996-A).

          "Head Lease (1996-B)":  means the Head Lease Agreement (1996-B) dated
           -------------------
     as of November 15, 1996, between Enserch Exploration and the Grantor
     Trustee (1996-B).

          "Head Leases":  means, collectively, the Head Lease (1996-A) and the
           -----------
     Head Lease (1996-B).

          "Holder":  See Certificateholder.
           ------

          "Initial Securities":  means the Certificates originally issued on the
           ------------------
     date hereof and any Certificates issued in exchange or replacement thereof
     pursuant to the terms of this Trust Agreement.

          "Indenture (1996-A)":  means the Trust Indenture, Mortgage, Assignment
           ------------------
     of Lease and Security Agreement (1996-A) dated as of November 15, 1996,
     between the Grantor Trustee (1996-A) and the Indenture Trustee (1996-A), as
     such Indenture may be amended or supplemented in accordance with its terms.

          "Indenture (1996-B)":  means the Trust Indenture, Mortgage, Assignment
           ------------------
     of Lease and Security Agreement (1996-B) dated as of November 15, 1996,
     between the Grantor Trustee (1996-B) and the Indenture Trustee (1996-B), as
     such Indenture may be amended or supplemented in accordance with its terms.

          "Indenture Event of Default (1996-A)":  means any Indenture Event of
           -----------------------------------
     Default (1996-A) (as such term is defined in the Indenture (1996-A)).

                                       5
<PAGE>

          "Indenture Event of Default (1996-B)":  means any Indenture Event of
           -----------------------------------
     Default (1996-B) (as such term is defined in the Indenture (1996-B)).

          "Indenture Events of Default":  means, collectively, the Indenture
           ---------------------------
     Events of Default (1996-A) and the Indenture Events of Default (1996-B).

          "Indenture Trustee (1996-A)":  means The Bank of New York, a New York
           --------------------------
     banking corporation, as Corporate Indenture Trustee under the Indenture
     (1996-A) and Frederick W. Clark, not in his individual capacity except as
     expressly provided in the Indenture (1996-A) but solely as Individual
     Indenture Trustee, and any successor to any such Indenture Trustee as such
     trustee.

          "Indenture Trustee (1996-B)":  means The Bank of New York, a New York
           --------------------------
     banking corporation, as Corporate Indenture Trustee under the Indenture
     (1996-B) and Frederick W. Clark, not in his individual capacity except as
     expressly provided in the Indenture (1996-B) but solely as Individual
     Indenture Trustee, and a successor to such Indenture Trustee as such
     trustee.

          "Indenture Trustees":  means, collectively, the Indenture Trustee
           ------------------
     (1996-A) and the Indenture Trustee (1996-B).

          "Indentures":  means, collectively, the Indenture (1996-A) and the
           ----------
     Indenture (1996-B).

          "Lease (1996-A)":  means the Production System Lease Agreement dated
           --------------
     as of November 15, 1996, between the Grantor Trustee (1996-A), as the
     lessor, and Enserch Exploration, as the lessee, as such Lease may be
     amended or supplemented in accordance with its terms.

          "Lease (1996-B)":  means the Production System Lease Agreement dated
           --------------
     as of November 15, 1996, between the Grantor Trustee (1996-B), as the
     lessor, and Enserch Exploration, as the lessee, as such Lease may be
     amended or supplemented in accordance with its terms.

          "Leases":  means, collectively, the Lease (1996-A) and the Lease
           ------
     (1996-B).

          "Lease Transaction":  means the lease-leaseback transaction in respect
           -----------------
     of the Undivided Interests between Enserch Exploration and the Grantor
     Trustee provided for in the Participation Agreements.

                                       6
<PAGE>

          "Letter of Representations":  means the agreement among Enserch
           -------------------------
     Exploration, the Trustee and DTC substantially in the form attached hereto
     as Exhibit C.

          "Note Documents":  means, with respect to any Secured Note, such
           --------------
     Secured Note and the Indenture, the Participation Agreement, the Lease and
     the other Operative Documents (as defined in the Indenture under which such
     Secured Note was issued).

          "Officer's Certificate":  means a certificate signed (i) in the case
           ---------------------
     of a corporation by the President, any Vice President or the Treasurer, of
     such corporation, (ii) in the case of a partnership by the Chairman of the
     Board, the President or any Vice President, the Treasurer or an Assistant
     Treasurer of a corporate general partner, and (iii) in the case of any
     Grantor Trustee or any Indenture Trustee, a certificate signed by a
     Responsible Officer of such Grantor Trustee or Indenture Trustee.

          "Opinion of Counsel":  means an opinion in writing, signed by legal
           ------------------
     counsel, who may be (a) the General Counsel, Assistant General Counsel or
     other appropriate internal counsel of Enserch Exploration or (b) such other
     counsel designated by Enserch Exploration, the Grantor Trustee or the
     Indenture Trustee, whether or not such counsel is an employee of any of
     them and who shall be reasonably acceptable to the Trustee.

          "Outstanding":  when used with respect to the Certificates, means, as
           -----------
     of the date of determination, all Certificates theretofore authenticated
     and delivered under this Trust Agreement, except:

                    (i)    Certificates theretofore canceled by the Registrar or
          delivered to the Trustee or the Registrar for cancellation;

                    (ii)   Certificates for which money in the full amount has
          been theretofore deposited with the Trustee or any Paying Agent in
          trust for the Holders of such Certificates as provided in Section 4.01
          pending distribution of such money to the Certificateholders pursuant
          to the final distribution payment to be made pursuant to Section 11.01
          hereof; and

                    (iii)  Certificates in exchange for or in lieu of which
          other Certificates have been authenticated and delivered pursuant to
          this Trust Agreement.

                                       7
<PAGE>

          "Owner Participant (1996-A)":  means the Owner Participant referred to
           --------------------------
     in the Participation Agreement (1996-A) and any permitted successors and
     assigns.

          "Owner Participant (1996-B)":  means the Owner Participant referred to
           --------------------------
     in the Participation Agreement (1996-B) and any permitted successors and
     assigns.

          "Owner Participants":  means, collectively, the Owner Participant
           ------------------
     (1996-A) and the Owner Participant (1996-B).

          "Participation Agreement (1996-A)":  means the Participation Agreement
           --------------------------------
     (1996-A) dated as of November 15, 1996, among Enserch Exploration, the
     Owner Participant (1996-A), the Grantor Trustee (1996-A), the Indenture
     Trustee (1996-A) and the Trustee.

          "Participation Agreement (1996-B)":  means the Participation Agreement
           --------------------------------
     (1996-B) dated as of November 15, 1996 among Enserch Exploration, the Owner
     Participant (1996-B), the Grantor Trustee (1996-B), the Indenture Trustee
     (1996-B) and the Trustee.

          "Participation Agreements":  means, collectively, the Participation
           ------------------------
     Agreement (1996-A) and the Participation Agreement (1996-B).

          "Paying Agent":  means the paying agent maintained and appointed
           ------------
     pursuant to Section 7.12.

          "Permanent Regulation S Global Certificate":  has the meaning assigned
           -----------------------------------------
     in Section 3.01(f).

          "Permitted Government Investment":  means obligations of the United
           -------------------------------
     States of America for the payment of which the full faith and credit of the
     United States of America is pledged, maturing in not more than 60 days or
     such lesser time as is necessary for payment of any Special Payments on a
     Special Distribution Date.

          "Person":  means any individual, corporation, limited liability
           ------
     company, partnership, association, trust, unincorporated organization, or
     government or any agency or political subdivision thereof.

          "Physical Certificate":  has the meaning assigned in Section 3.10.
           --------------------

                                       8
<PAGE>

          "Pool Balance":  means, as of any date, the aggregate unpaid and
           ------------
     undistributed principal amount of the Secured Notes on such date plus the
     amount of the principal payments on the Secured Notes held by the Trustee
     and not yet distributed.  The Pool Balance as of any Distribution Date or
     Special Distribution Date, if any, shall be computed after giving effect to
     the payment of principal, if any, on the Secured Notes and distribution
     thereof to be made on that date.

          "Pool Factor":  means, as of any date, the quotient (rounded to the
           -----------
     seventh decimal place) computed by dividing (i) the Pool Balance by (ii)
     the aggregate original principal amount of the Certificates.  The Pool
     Factor, as of any Distribution Date or Special Distribution Date, if any,
     shall be computed after giving effect to the payment of principal, if any,
     on the Secured Notes and distribution thereof to be made on that date.

          "QIB":  means a "qualified institutional buyer," as defined in Rule
           ---
     144A under the Securities Act.

          "Record Date":  means (i) for Scheduled Payments to be distributed on
           -----------
     any Distribution Date, other than the final distribution, the day (whether
     or not a Business Day) which is 15 days preceding such Distribution Date,
     and (ii) for Special Payments to be distributed on any Special Distribution
     Date, if any, other than the final distribution, the day (whether or not a
     Business Day) which is 15 days preceding such Special Distribution Date.

          "Register and Registrar":  means the register maintained and the
           ----------------------
     registrar appointed pursuant to Sections 3.04 and 7.12.

          "Regulation S Certificates Exchange Date":  has the meaning provided
           ---------------------------------------
     in Section 3.01.

          "Regulation S Global Certificate":  has the meaning specified in
           -------------------------------
     Section 3.01.

          "Responsible Officer":  When used with respect to the initial Trustee,
           -------------------
     an initial Indenture Trustee or a Grantor Trustee means any officer in the
     Corporate Trust Office; when used with respect to any successor Trustee, or
     successor Indenture Trustee, means the chairman or vice-chairman of the
     board of directors or trustees, the chairman or vice-chairmen of the
     executive or standing committee of the board of directors or trustees, the
     president, the chairman of the committee on trust matters, any vice-
     president, any second vice-president, the secretary, any assistant
     secretary, the treasurer, any assistant treasurer, any

                                       9
<PAGE>

     trust officer or assistant trust officer, the comptroller and any assistant
     comptroller; and, when used with respect to any Trustees and Indenture
     Trustees, also means any other officer of such Trustee or such Indenture
     Trustee customarily performing functions similar to those performed by any
     of the above designated officers and also means, when used with respect to
     the Trustees, Indenture Trustees or Grantor Trustees with respect to a
     particular corporate trust matter, any other officer to whom such matter is
     referred because of his knowledge of and familiarity with the particular
     subject.

          "Restricted Global Security":  has the meaning specified in Section
           --------------------------
     3.01.

          "Restricted Period":  has the meaning specified in Section 3.01.
           -----------------

          "Restricted Securities":  has the meaning specified in Section 3.10.
           ---------------------

          "Restricted Securities Legend":  has the meaning specified in Section
           ----------------------------
     3.10.

          "Scheduled Payment":  with respect to a Distribution Date, means any
           -----------------
     payment (other than a Special Payment) of principal and interest on a
     Secured Note, due from the Grantor Trustee that issued such Secured Note,
     which payment represents the payment of a regularly scheduled installment
     of principal then due on such Secured Note, or the payment of regularly
     scheduled interest accrued on such Secured Note.

          "Secured Note (1996-A)":  means any one of the Secured Notes (as
           ---------------------
     defined in the Indenture (1996-A)) described on Schedule 1 attached hereto,
     including any Secured Note (as so defined) issued under such Indenture in
     replacement or substitution therefor, held by the Trustee.

          "Secured Note (1996-B)":  means any one of the Secured Notes (as
           ---------------------
     defined in the Indenture (1996-B)) described on Schedule 2 attached hereto,
     including any Secured Note (as so defined) issued under such Indenture in
     replacement or substitution therefor, held by the Trustee.

          "Secured Notes":  means, collectively, the Secured Notes (1996-A) and
           -------------
     the Secured Notes (1996-B).

          "Securities Act":  means the Securities Act of 1933, as amended from
           --------------
     time to time.

                                       10
<PAGE>

          "Securities Exchange Act":  means the Securities Exchange Act of 1934,
           -----------------------
     as amended from time to time.

          "Special Distribution Date (1996-A)":  means (i) with respect to the
           ----------------------------------
     prepayment of any Secured Notes (1996-A), the 2nd day of the month on which
     such prepayment is scheduled to occur pursuant to the terms of the
     Indenture (1996-A) and (ii) with respect to any Special Payment (1996-A)
     relating to a Secured Note (1996-A) other than as described in clause (i)
     of the definition of Special Payment (1996-A), the earliest 2nd day of a
     month for which it is practicable for the Trustee to give notice pursuant
     to Section 4.02(c) 20 days prior thereto.

          "Special Distribution Date (1996-B)":  means (i) with respect to the
           ----------------------------------
     prepayment of any Secured Notes (1996-B), the 2nd day of the month on which
     such prepayment is scheduled to occur pursuant to the terms of the
     Indenture (1996-B) and (ii) with respect to any Special Payment (1996-B)
     relating to a Secured Note (1996-B) other than as described in clause (i)
     of the definition of Special Payment (1996-B), the earliest 2nd day of a
     month for which it is practicable for the Trustee to give notice pursuant
     to Section 4.02(c) 20 days prior thereto.

          "Special Distribution Dates":  means, collectively, the Special
           --------------------------
     Distribution Date (1996-A) and the Special Distribution Date (1996-B).

          "Special Payment (1996-A)":  with respect to a Secured Note (1996-A),
           ------------------------
     means (i) any payment of principal, Make-Whole Amount, if any, and interest
     on such Secured Note resulting from
     the prepayment of such Secured Note pursuant to Sections 3.02, 3.03, 3.05
     or 3.06 of the Indenture (1996-A), (ii) any payment of principal and
     interest (including any interest accruing upon default) on, or any other
     amount in respect of, such Secured Note upon an Indenture Event of Default
     (1996-A) in respect thereof or upon the exercise of remedies under the
     Indenture (1996-A) relating to such Secured Note, (iii) any Scheduled
     Payment (1996-A) or any Special Payment (1996-A) referred to in clause (i)
     of this definition which is not in fact paid within five days of the
     Distribution Date (1996-A) or Special Distribution Date (1996-A) applicable
     thereto, or (iv) any proceeds from the sale of any Secured Note (1996-A) by
     the Trustee pursuant to Article VI hereof; and Special Payments (1996-A)
     means all of such Special Payments.

          "Special Payment (1996-B)":  with respect to a Secured Note (1996-B),
           ------------------------
     means (i) any payment of principal, Make-Whole Amount, if any, and interest
     on such Secured Note resulting from

                                       11
<PAGE>

     the prepayment of such Secured Note pursuant to Sections 3.02, 3.03, 3.05
     or 3.06 of the Indenture (1996-B), (ii) any payment of principal and
     interest (including any interest accruing upon default) on, or any other
     amount in respect of, such Secured Note upon an Indenture Event of Default
     (1996-B) in respect thereof or upon the exercise of remedies under the
     Indenture (1996-B) relating to such Secured Note, (iii) any Scheduled
     Payment (1996-B) or any Special Payment (1996-B) referred to in clause (i)
     of this definition which is not in fact paid within five days of the
     Distribution Date (1996-B) or Special Distribution Date (1996-B) applicable
     thereto, or (iv) any proceeds from the sale of any Secured Note (1996-B) by
     the Trustee pursuant to Article VI hereof; and Special Payments (1996-B)
     means all of such Special Payments.

          "Special Payments":  means, collectively, the Special Payment (1996-A)
           ----------------
     and the Special Payment (1996-B).

          "Special Payments Account (1996-A)":  means the account or accounts
           ---------------------------------
     created and maintained pursuant to Section 4.01(b).

          "Special Payments Account (1996-B)":  means the account or accounts
           ---------------------------------
     created and maintained pursuant to Section 4.01(b).

          "Special Payments Accounts":  means, collectively, the Special
           -------------------------
     Payments Account (1996-A) and the Special Payment Account (1996-B).

          "Specified Investments":  means (i) direct obligations of the United
           ---------------------
     States of America and agencies thereof for which the full faith and credit
     of the United States is pledged, (ii) obligations fully guaranteed by the
     United States of America, (iii) certificates of deposit issued by, or
     bankers' acceptances of, or time deposits with, any bank, trust company or
     national banking association incorporated or doing business under the laws
     of the United States of America or one of the States thereof having
     combined capital and surplus and retained earnings of at least $500,000,000
     (including the Indenture Trustee or Grantor Trustee if such conditions are
     met), (iv) commercial paper of companies, banks, trust companies or
     national banking associations incorporated or doing business under the laws
     of the United States of America or one of the States thereof and in each
     case having a rating assigned to such commercial paper by Standard & Poor's
     Corporation or Moody's Investors Services, Inc. (or, if neither such
     organization shall rate such commercial paper at any time, by any
     nationally recognized rating organization in the United States of America)
     equal to the highest rating assigned by such organization, and (v) purchase
     agreements with any financial institution having a

                                       12
<PAGE>

     combined capital and surplus of at least $750,000,000 fully collateralized
     by obligations of the type described in clauses (i) through (iv) above;
     provided that if all of the above investments are unavailable, the entire
     amount to be invested may be used to purchase Federal Funds from an entity
     described in (iii) above; and provided further that no investment shall be
     eligible as a "Specified Investment" unless the final maturity or date of
     return of such investment is 91 days or less from the date of purchase
     thereof.

          "Temporary Regulation S Global Certificate":  has the meaning provided
           -----------------------------------------
     in Section 3.01.

          "Transfer Date":  means the Closing Date as the term is defined in the
           -------------
     Participation Agreement scheduled to occur on December 2, 1996, or if
     postponed in accordance with the Participation Agreement, the rescheduled
     Closing Date.

          "Trust":  means the trust created by this Trust Agreement, the estate
           -----
     of which consists of the Trust Property.

          "Trust Indenture Act":  means the Trust Indenture Act of 1939, as
           -------------------
     amended from time to time.

          "Trust Property":  means the Secured Notes held as the property of the
           --------------
     Trust created hereby and all monies at any time paid thereon and all monies
     due and to become due thereunder, funds from time to time deposited in the
     Certificate Account and the Special Payments Accounts and any proceeds of
     any of the foregoing, including without limitation from the sale by the
     Trustee pursuant to Article VI hereof of any Secured Note.

          "Trustee":  means the institution executing this Trust Agreement as
           -------
     Trustee, or its successor in interest, and any successor trustee appointed
     as provided herein.

          "Unrestricted Global Certificate":  has the meaning provided in
           -------------------------------
     Section 3.01.

          "Undivided Interests":  means each of the Undivided Interests
           -------------------
     described in the Participation Agreement (1996-A) and the Participation
     Agreement (1996-B).

          (c)  Capitalized terms used but not defined herein shall have the
     meanings specified in the Participation Agreements.

                                       13
<PAGE>

          Section 1.02.  Compliance Certificates and Opinions.  Upon any
                         ------------------------------------
application or request by Enserch Exploration, any Grantor Trustee or any
Indenture Trustee to the Trustee to take any action under any provision of this
Trust Agreement, Enserch Exploration, such Grantor Trustee or such Indenture
Trustee, as the case may be, shall furnish to the Trustee an Officers'
Certificate stating that, in the opinion of the signers, all conditions
precedent, if any, provided for in this Trust Agreement relating to the proposed
action have been complied with and an Opinion of Counsel stating that in the
opinion of such counsel all such conditions precedent, if any, have been
complied with, except that in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Trust Agreement relating to such particular application or request, no
additional certificate or opinion need be furnished.

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

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

          (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 each such individual, he has
     made such examination or investigation as is necessary to enable him to
     express an informed opinion as to whether or not such covenant or condition
     has been complied with; and

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

          Section 1.03.  Form of Documents Delivered to Trustee.  In any case
                         --------------------------------------
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters and any such Person may certify or give an opinion as to
such matters in one or several documents.

          Any Opinion of Counsel stated to be based on the opinion of other
counsel shall be accompanied by a copy of such other opinion.

                                       14
<PAGE>

          Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Trust Agreement, they may, but need not, be consolidated
and form one instrument.

          Section 1.04.  Acts of Holders.  (a)  Any direction, consent, waiver
                         ---------------
or other action provided by this Trust Agreement to be given or taken by Holders
may be embodied in and evidenced by one or more instruments of substantially
similar tenor signed by such Holders in person or by an agent duly appointed in
writing; and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee and, where it is herein expressly required, to Enserch Exploration or
the Indenture Trustees.  Such instrument or instruments (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as the "Act" of
the Holders signing such instrument or instruments.  Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Trust Agreement and (subject to Section 7.01) conclusive
in favor of the Trustee, Enserch Exploration and the Indenture Trustees, if made
in the manner provided in this Section.

          (b)  The fact and date of the execution by any Person of any such
instrument or writing may be proved by the certificate of any notary public or
other officer of any jurisdiction authorized to take acknowledgments of deeds or
administer oaths that the Person executing such instrument acknowledged to him
the execution thereof, or by an affidavit of a witness to such execution sworn
to before any such notary or such other officer and where such execution is by
an officer of a corporation or association or a member of a partnership, on
behalf of such corporation, association or partnership, such certificate or
affidavit shall also constitute sufficient proof of his authority.  The fact and
date of the execution of any such instrument or writing, or the authority of the
Person executing the same, may also be proved in any other reasonable manner
which the Trustee deems sufficient.

          (c)  In determining whether the Holders of the requisite Fractional
Undivided Interests of Certificates Outstanding have given any direction,
consent or waiver (a "Direction"), under this Trust Agreement, Certificates
owned by Enserch Exploration, the Grantor Trustees, the Owner Participants or
any Affiliate of any such Persons shall be disregarded and deemed not to be
Outstanding under this Trust Agreement for purposes of any such determination.
In determining whether the Trustee shall be protected in relying upon any such
Direction, only Certificates which the Trustee knows to be so owned shall be so
disregarded.  Notwithstanding the foregoing, (i) if any such Person owns 100% of
the Certificates Outstanding, such Certificates shall not be so disregarded as
aforesaid, and (ii) if any amount of Certificates so owned

                                       15
<PAGE>

by any such Person have been pledged in good faith, such Certificates shall not
be disregarded as aforesaid if the pledgee establishes to the satisfaction of
the Trustee the pledgee's right so to act with respect to such Certificates and
that the pledgee is not Enserch Exploration, the Grantor Trustees, the Owner
Participants or any Affiliate of any such Persons.

          (d)  Any direction, consent, waiver or other action by the Holder of
any Certificate shall bind the Holder of every Certificate issued upon the
transfer thereof or in exchange therefor or in lieu thereof, whether or not
notation of such action is made upon such Certificate.

          (e)  Except as otherwise provided in Section 1.04(c), Certificates
owned by or pledged to any Person shall have an equal and proportionate benefit
under the provisions of this Trust Agreement, without preference, priority, or
distinction as among all of the Certificates.

                                   ARTICLE II

        ACQUISITION OF SECURED NOTES; ORIGINAL ISSUANCE OF CERTIFICATES

          Section 2.01.  Issuance of Certificates; Acquisition of Secured Notes.
                         ------------------------------------------------------
The Trustee, simultaneously with the execution and delivery of this Trust
Agreement, shall also execute and deliver the Participation Agreements, in the
form delivered to the Trustee on or prior to the date of the execution and
delivery hereof.  Upon request of Enserch Exploration and the satisfaction of
the closing conditions with respect to the Undivided Interests to be leased on
the Transfer Date specified in the Participation Agreements, on the Transfer
Date the Trustee shall execute, deliver and authenticate Certificates equaling
in the aggregate the total aggregate principal amount of the Secured Notes
purchased by the Trustee pursuant to the Participation Agreements on the
Transfer Date and evidencing the entire ownership of the Trust; provided, that,
                                                                --------
notwithstanding Section 1.02 hereof, such request need not be accompanied by an
Opinion of Counsel.  The Trustee shall issue and sell such Certificates on the
Transfer Date, in authorized denominations and in such Fractional Undivided
Interests, so as to result in the receipt of consideration in an amount equal to
the aggregate principal amount of the Secured Notes to be purchased on the
Transfer Date (the "Consideration").  The Trustee shall purchase, pursuant to
the terms and conditions of the Participation Agreements, the Secured Notes on
the Transfer Date at an aggregate purchase price equal to the amount of the
Consideration so received.  Except as provided in Section 3.05 hereof,

                                       16
<PAGE>

the Trustee shall not execute or deliver Certificates in excess of the aggregate
amount specified in this paragraph.

          Section 2.02.  Acceptance by Trustee.  The Trustee, upon the execution
                         ---------------------
and delivery of this Trust Agreement, acknowledges its acceptance of all right,
title, and interest in and to the Secured Notes acquired pursuant to Section
2.01 hereof and the Participation Agreements and declares that the Trustee holds
and will hold such right, title, and interest, together with all other property
constituting the Trust Property, for the benefit of all present and future
Certificateholders, upon the trusts herein set forth.  By its payment for and
acceptance of each Certificate issued to it hereunder, each initial
Certificateholder as grantor of the Trust thereby joins in the creation and
declaration of the Trust.

          Section 2.03.  Limitation of Powers.  The Trust is constituted solely
                         --------------------
for the purpose of making the investment in the Secured Notes, and, except as
set forth herein, the Trustee is not authorized or empowered to acquire any
other investments or engage in any other activities and, in particular, the
Trustee is not authorized or empowered to do anything that would cause the Trust
to fail to qualify as a "grantor trust" for federal income tax purposes
(including, as subject to this restriction, acquiring the Undivided Interests by
bidding the Secured Notes or otherwise, or taking any action with respect to the
Undivided Interests once acquired).

                                  ARTICLE III

                                THE CERTIFICATES

          Section 3.01.  Form, Denomination and Execution of Certificates.  (a)
                         ------------------------------------------------
The Certificates shall be in fully registered form without interest coupons
substantially in the form of Exhibit A hereto and shall contain such additional
provisions, omissions, variations and insertions as are permitted by this Trust
Agreement, and may have such letters, numbers or other marks of identification
and such legends or endorsements printed, lithographed or engraved thereon, as
may be required to comply with the securities laws of any jurisdiction, the
rules of any Depository or any securities exchange on which the Certificates may
be listed or to conform to any usage in respect thereof, or as may, consistently
herewith, be prescribed by Enserch Exploration, the Trustee or by the officer
executing such Certificates, such determination to be evidenced by the execution
of the Certificates.  The Certificates also shall be subject to the terms and
conditions contained in this Trust Agreement.  References herein to the
"Certificates" shall be deemed to include the Restricted Global Certificate, the
Temporary Regulation S Global Certificate, the Permanent Regulation S Global
Certificate, any

                                       17
<PAGE>

Unrestricted Global Certificate and any Physical Certificates (each as defined
below) along with any Certificates issued in exchange therefor, unless the
context requires otherwise.

          (b)  Definitive Certificates shall be printed, lithographed or
engraved or produced by any combination of these methods or may be produced in
any other manner permitted by the rules of any Depository or any securities
exchange on which the Certificates may be listed, all as determined by the
officer executing such Certificates, as evidenced by his execution of such
Certificates.

          (c)  The Certificates shall be initially issued in minimum
denominations of $250,000, or integral multiples of $1,000 in excess thereof.
At such time as the transfer restrictions contained in the Certificates and this
Article III, are no longer applicable to a Certificate, the minimum denomination
of such Certificate shall be reduced to $1,000, or integral multiples of $1,000
in excess thereof.

          (d)  The Certificates shall be executed on behalf of the Trustee by
manual or facsimile signature of a Responsible Officer of the Trustee.
Certificates bearing the manual or facsimile signature of an individual who was,
at the time when such signature was affixed, authorized to sign on behalf of the
Trustee shall be valid and binding obligations of the Trustee, notwithstanding
that such individual has ceased to be so authorized prior to the authentication
and delivery of such Certificates or did not hold such office at the date of
such Certificates.  No Certificate shall be entitled to any benefit under this
Trust Agreement, or be valid for any purposes, unless there appears on such
Certificate a certificate of authentication substantially in the form set forth
in Exhibit A hereto executed by the Trustee by manual signature, and such
certificate of authentication upon any Certificate shall be conclusive evidence,
and the only evidence, that such Certificate has been duly authenticated and
delivered hereunder.  All Certificates shall be dated the date of their
authentication.

          (e)  Certificates offered and sold in their initial distribution in
reliance upon Rule 144A under the Securities Act shall be represented by a
single, permanent global Certificate (the "Restricted Global Certificate") in
                                           -----------------------------
fully registered form, without interest coupons, substantially in the form
required by this Article and in Exhibit A, with such Restricted Securities
Legend and other legends as are provided for in Exhibit A.  The Restricted
Global Certificate shall be registered in the name of the Depository or a
nominee of the Depository in the United States and shall represent the
beneficial interests of Persons purchasing the Certificates in reliance on Rule
144A under the Securities Act.  The Restricted Global Certificate shall be
deposited on behalf of the purchasers of such Certificate with the Trustee, at
its Corporate Trust Office, as custodian for the Depository.  So long as the
Depository or

                                       18
<PAGE>

its nominee is the registered owner of the Restricted Global Certificate, it
shall be considered the Holder of the Certificate represented thereby for all
purposes hereunder and under such Certificate. Neither Enserch Exploration nor
any Paying Agent shall have any responsibility or liability for any aspect of
the records relating to or payments made by the Depository on account of
beneficial interests in the Restricted Global Certificate. Beneficial interests
in the Restricted Global Certificate shall be transferred on the Depository's
book-entry settlement system. The aggregate principal amount of the Restricted
Global Certificate may from time to time be increased or decreased by
adjustments made on the records of the Trustee, as custodian for the Depository
or its nominee, as the case may be, as herein provided. In the event that an
interest in the Restricted Global Certificate shall be transferred in accordance
with Rule 144 or Regulation S under the Securities Act or pursuant to an
effective registration statement under the Securities Act (unless the Holder
thereof is Enserch Exploration or an "affiliate" of Enserch Exploration within
the meaning of Rule 144) or pursuant to another available exemption under the
Securities Act and in accordance with the provisions of this Trust Agreement,
the Certificate representing such interest after such transfer shall no longer
be required to bear the Restricted Securities Legend or be a Restricted Security
and shall be and be referred to herein as an "Unrestricted Global Certificate."

          (f)  Certificates offered and sold in their initial distribution in
reliance on Regulation S under the Securities Act shall be issued initially in
the form of a single temporary global Certificate in fully registered form,
without coupons, substantially in the form set forth in Exhibit A, with such
applicable legends as are provided for in Exhibit A (the "Temporary Regulation S
                                                          ----------------------
Global Certificate").  Such Global Certificate shall be registered in the name
------------------
of the Depository or its nominee and deposited with the Trustee, at its
Corporate Trust Office, as custodian for such Depository, duly executed and
authenticated by the Trustee as herein provided, for credit initially and during
the Restricted Period (hereinafter defined) to the respective accounts of
beneficial owners of interests in such Certificate (or to such other accounts as
they may direct) at Morgan Guaranty Trust Company of New York, Brussels office,
as operator of the Euroclear System ("Euroclear") or the depository for Centrale
                                      ---------
de Livraison de Valeurs Mobilieres S.A. ("Cedel").  As used herein, the term
                                          -----
"Restricted Period," with respect to Global Certificates offered and sold in
reliance on Regulation S, means the period of 40 consecutive days beginning on
and including the later of (i) the day on which the Certificates are first
offered to persons other than distributors (as defined in Regulation S) in
reliance on Regulation S (according to a notice to Enserch Exploration and the
Trustee by the underwriter, if any, of the offering of such Certificates and
(ii) the Transfer Date.  Except as otherwise provided herein or agreed by
Enserch Exploration, no Regulation S Global Certificate shall be issued except
as provided in this paragraph to

                                       19
<PAGE>

evidence Certificates offered and sold in their initial distribution in
reliance on Regulation S under the Securities Act.  At any time following
the last day of the Restricted Period (the "Regulation S Certificates Exchange
                                            ----------------------------------
Date"), upon receipt by the Trustee and Enserch Exploration of a certificate
----
substantially in the form of Exhibit B, a single permanent global Certificate in
fully registered form substantially in the form set forth in Exhibit A (the
"Permanent Regulation S Global Certificate;" and, together with the Temporary
 -----------------------------------------
Regulation S Global Certificate, the "Regulation S Global Certificate") duly
                                      -------------------------------
executed and authenticated by the Trustee as hereinafter provided shall be
deposited on behalf of the beneficial owners thereof with a custodian for the
Depository and will be registered in the name of the Depository or a nominee of
the Depository located in a jurisdiction approved by Enserch Exploration for
credit to the beneficial owners' respective accounts (or to such other accounts
as they may direct) at Morgan Guaranty Trust Company of New York, Brussels
office, as operator of Euroclear or the depository for Cedel or any other
participant in the Depository. The Permanent Regulation S Global Certificate and
any Certificates issued upon registration of transfer of or exchange for such
Permanent Regulation S Global Security shall not be a Restricted Security and
shall also be referred to herein as an "Unrestricted Global Certificate".  The
                                        -------------------------------
aggregate principal amount of the Regulation S Global Certificate may from time
to time be increased and decreased by adjustments made on the records of the
Depository or its nominee, as the case may be, as herein provided.

          (g)  Beneficial interests in the Regulation S Global Certificate may
be (i) held through Euroclear or Cedel as participants in the Depository or (ii)
subject to the rules and procedures of Euroclear or Cedel and the Depository,
exchanged for, or transferred to a Person who takes delivery in the form of, an
interest in the Restricted Global Certificate.  Beneficial interests in the
Restricted Global Certificate may be, subject to the rules and procedures of the
Depository, exchanged for, or transferred to a Person who takes delivery in the
form of an interest in an Unrestricted Global Certificate, only upon receipt by
the Trustee of a written certification from the transferor substantially in the
form of Exhibit E to the effect that such transfer is being made in accordance
with Regulation S or Rule 144 under the Securities Act.  Any beneficial interest
in any Global Certificate that is transferred to a Person who takes delivery in
the form of an interest in the other Global Certificate will, upon transfer,
cease to be an interest in such Global Certificate and become an interest in the
other Global Certificate and, accordingly, will thereafter be subject to all
transfer restrictions and other procedures applicable to beneficial interests in
such other Global Certificate for as long as it remains such an interest.

          Pass Through Certificates offered and sold in their initial
distribution to a limited number of institutions that are accredited

                                       20
<PAGE>

investors (which are not qualified institutional buyers, as defined under Rule
144A) within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities
Act (and institutions in which all the equity owners are such accredited
investors) (together referred to as "Institutional Accredited Investors") in
                                     ----------------------------------
transactions exempt from registration under the Securities Act shall be issued
in definitive physical and fully registered form without interest coupons,
substantially in the form set forth in this Article and in Exhibit A, with such
applicable legends as are provided for in Exhibit A. Such Securities shall be
delivered to such Institutional Accredited Investors only upon the execution and
delivery to the Company and the underwriter(s), if any, of the offering of such
Securities of a purchaser's letter, substantially in the form of Exhibit F
hereto. Such Securities may not be exchanged for interests in a Global Security
except as provided in Section 3.10.

          Section 3.02.  Authentication of Certificates.  The Trustee on the
                         ------------------------------
Transfer Date will cause to be authenticated and make available for delivery,
simultaneously with the sale, assignment, and transfer to the Trustee of the
Secured Notes pursuant to Section 2.01 hereof and the Participation Agreement,
Certificates duly authenticated by the Trustee, in authorized denominations
equaling in the aggregate the aggregate principal amount of the Secured Notes so
purchased and evidencing the entire ownership of the Trust.

          Section 3.03.  Temporary Certificates.  (a) Pending the preparation of
                         ----------------------
definitive Certificates, the Trustee may execute, authenticate and deliver
temporary Certificates which are printed, lithographed, typewritten, or
otherwise produced, in any denomination, of the tenor of the definitive
Certificates in lieu of which they are issued, with such appropriate insertions,
omissions, substitutions and other variations relating to their temporary nature
as the officer executing such temporary Certificates may determine, as evidenced
by their execution of such temporary Certificates.

          (b)  If temporary Certificates are issued, the Trustee will cause
definitive Certificates to be prepared without unreasonable delay.  After the
preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the Corporate Trust Office of the Trustee, or at the office or
agency of the Trustee maintained in accordance with Section 7.12, without charge
to the Holder.  Upon surrender for cancellation of any one or more temporary
Certificates, the Trustee shall execute, authenticate and deliver in exchange
therefor definitive Certificates of authorized denominations of a like aggregate
Fractional Undivided Interest.  Until so exchanged, such temporary Certificates
shall in all respects be entitled to the same benefits under this Trust
Agreement as definitive Certificates.

                                       21
<PAGE>

          Section 3.04.  Registration of Transfer and Exchange of Certificates.
                         -----------------------------------------------------

          (a)  The Trustee shall cause to be kept at the office or agency to be
maintained by it in accordance with the provisions of Section 7.12 a register
(the "Register") in which, subject to the provisions of this Section 3.04 and
the Certificates, the Trustee shall provide for the registration of Certificates
and of transfers and exchanges of Certificates as herein provided.  The Trustee
shall initially be the registrar (the "Registrar") for the purpose of
registering Certificates and transfers and exchanges of Certificates as herein
provided.

          (b)  Subject to the other provisions of Article III, upon surrender
for registration of transfer of any Certificate at the Corporate Trust Office or
such other office or agency, the Trustee shall execute, authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Certificates in authorized denominations of a like aggregate Fractional
Undivided Interest.  At the option of a Certificateholder, Certificates may be
exchanged for other Certificates of authorized denominations of a like aggregate
Fractional Undivided Interest, upon surrender of the Certificates to be
exchanged at any such office or agency.  Whenever any Certificates are so
surrendered for exchange, the Trustee shall execute, authenticate and deliver
the Certificates that the Certificateholder making the exchange is entitled to
receive.  Every Certificate presented or surrendered for registration of
transfer or exchange shall be duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Trustee and the Registrar
duly executed by the Holder thereof or his attorney duly authorized in writing.

          (c)  Subject to the other provisions of Article III, when Certificates
are presented to the Registrar or a co-Registrar with a request to register the
transfer or to exchange them for an equal principal amount of Certificates of
other authorized denominations, the Registrar shall register the transfer or
make the exchange as requested if its requirements for such transactions are
met.  To permit registrations of transfers and exchanges, the Trustee shall
execute and authenticate Certificates at the Registrar's request.  No service
charge shall be made for any registration of transfer or exchange of the
Certificates, but Enserch Exploration may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith.

          (d)  All Certificates surrendered for registration of transfer and
exchange shall be canceled by the Trustee.

                                       22
<PAGE>

          Section 3.05.  Mutilated, Destroyed, Lost or Stolen Certificates.  If
                         -------------------------------------------------
(a) any mutilated Certificate is surrendered to the Registrar, or the Registrar
receives evidence to its satisfaction of the destruction, loss or theft of any
Certificate and (b) there is delivered to the Registrar and the Trustee such
security, indemnity or bond, as may be required by them to save each of them
harmless, then, in the absence of notice to the Registrar or the Trustee that
such Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute, authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
Fractional Undivided Interest with the same final Distribution Date.  In
connection with the issuance of any new Certificate under this Section 3.05, the
Trustee shall require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee and the Registrar)
connected therewith.  Any duplicate Certificate issued pursuant to this Section
3.05 shall constitute conclusive evidence of the appropriate Fractional
Undivided Interest in the Trust, as if originally issued, whether or not the
lost, stolen or destroyed Certificate shall be found at any time.

          Section 3.06.  Persons Deemed Owners.  Prior to due presentation of a
                         ---------------------
Certificate for registration of transfer, the Trustee, the Registrar, and any
Paying Agent shall treat the Person in whose name any Certificate is registered
as the owner of such Certificate for the purpose of receiving distributions
pursuant to Section 4.02 and for all other purposes whatsoever, and neither
Enserch Exploration, the Trustee, the Registrar, nor any Paying Agent shall be
affected by any notice to the contrary.

          Section 3.07.  Cancellation.  All Certificates surrendered for payment
                         ------------
or transfer or exchange shall, if surrendered to any Person party hereto other
than the Registrar, be delivered by such Person to the Registrar for
cancellation.  The Registrar shall not be required to destroy the Certificates.
No Certificates shall be authenticated in lieu of or in exchange for any
Certificates canceled as provided in this Section, except as expressly permitted
by this Trust Agreement.

          Section 3.08.  Limitation of Liability for Payments.  All payments or
                         ------------------------------------
distributions made to Certificateholders under this Trust Agreement shall be
made only from the Trust Property and only to the extent that the Trustee shall
have sufficient income or proceeds from the Trust Property to make such payments
in accordance with the terms of Article IV of this Trust Agreement.  Each Holder
of a Certificate, by its acceptance of such Certificate, agrees that it will
look solely to the income and proceeds from the Trust Property to the extent
available for distribution to the Holder thereof as provided in this Trust
Agreement.

                                       23
<PAGE>

Nothing in this Trust Agreement shall be construed as an agreement, or otherwise
creating an obligation, of Enserch Exploration to pay any of the principal,
Make-Whole Amount, if any, and interest due from time to time under the Secured
Notes or in respect of the Certificates.

          Section 3.09.  Book-Entry Provisions for Global Certificates. (a) Any
                         ---------------------------------------------
Holder of a Global Certificate shall, by acceptance of such Global Certificate,
agree that transfers of beneficial interests in such Global Certificate shall be
effected only through a book entry system maintained by the Holder of such
Global Certificate (or its agent), and that ownership of a beneficial interest
in such Certificate shall be required to be reflected in a book entry.

          (b)  Members of, or participants in, the Depository ("Agent Members")
                                                                -------------
shall have no rights under this Trust Agreement with respect to any Global
Certificate held on their behalf by the Depository, or the Trustee as its
custodian, or under the Global Certificate and the Depository may be treated by
Enserch Exploration, the Trustee and any Paying Agent as the absolute owner of
such Global Certificate for all purposes whatsoever.  Notwithstanding the
foregoing, nothing herein shall prevent Enserch Exploration, the Trustee or any
Paying Agent from giving effect to any written certification, proxy or other
authorization furnished by the Depository or impair, as between the Depository
and its Agent Members, the operation of customary practices governing the
exercise of the rights of a holder of any Certificate.

          (c)  Transfers of Global Certificates shall be limited to transfers of
such Global Certificates in whole, but not in part, to the Depository, its
successors or their respective nominees.  Interests of beneficial owners in any
Global Certificate may be transferred in accordance with the rules and
procedures of the Depository and the provisions of this Trust Agreement.

          (d)  The Holder of any Global Certificate may grant proxies and
otherwise authorize any person, including Agent Members and persons that may
hold interests through Agent Members, to take any action which a Holder is
entitled to take under this Trust Agreement or the Certificates.

          (e)  The Trustee shall enter into the Letter of Representations and
fulfill its responsibilities thereunder.

          (f)  The beneficial interests represented by any Global Certificate
shall be issued as definitive certificated Certificates, without coupons,
registered in the names of Holders or their nominees, rather than in global
form, registered in the name of the Depository or its nominee, if (i) the
Depository notifies the Trustee in writing that it is no longer able or willing
to continue as Depository with respect to

                                       24
<PAGE>

the Certificates and a qualified successor is not appointed by the Trustee
within ninety (90) days after receiving such notice, (ii) the Depository ceases
to be a "clearing agency" registered under the Exchange Act and a qualified
successor is not appointed by the Trustee within ninety (90) days after the
Trustee becomes aware that the Depository is no longer so registered, (iii)
Enserch Exploration, at its option, elects to terminate the book-entry system
through the Depository or (iv) after the occurrence of an Event of Default,
beneficial owners of Certificates evidencing Fractional Undivided Interests
aggregating not less than a majority in interest in the Certificates represented
by such Global Certificates advise the Trustee through the Depository in writing
that the continuation of a book-entry system through the Depository with respect
to the Certificates is no longer in such owners' best interests. Upon the
occurrence of any of the events in clauses (i) through (iii) above, the Trustee
shall, by forwarding notice to the Depository, be deemed to have notified all
Persons who hold a beneficial interest in such Global Certificate through an
Agent Member of the availability of definitive Certificates.

          (g)  In connection with any transfer of a portion of the beneficial
interests in any Global Certificate to beneficial owners pursuant to paragraph
(f) of this Section, the Registrar shall reflect on its books and records the
date and a decrease in the principal amount of such Global Certificate in an
amount equal to the principal amount of the beneficial interest in the Global
Certificate to be transferred, and Enserch Exploration shall execute, and the
Trustee shall authenticate and deliver one or more Physical Certificates of like
tenor and amount.  In connection with the transfer of an entire Global
Certificate to beneficial owners pursuant to paragraph (f) of this Section, such
Global Certificates shall be deemed to be surrendered to the Trustee for
cancellation, and the Trustee shall execute, authenticate and deliver to each
beneficial owner identified by the Depository in exchange for its beneficial
interest in such Global Certificate, as the case may be, an equal aggregate
principal amount of Physical Certificates of authorized denominations.  Any
Physical Certificate delivered in exchange for an interest in a Global
Certificate pursuant to this Section shall, except as otherwise provided in this
Trust Agreement bear the Restricted Securities Legend.

          Section 3.10.  Restrictions on Transfer and Exchange of Certificates.
                         ---------------------------- ------------------------
(a)  Except as otherwise provided herein, all Certificates to be issued
hereunder shall be restricted securities ("Restricted Securities") within the
                                           ---------------------
meaning of Rule 144 under the Securities Act and shall bear and be subject to
the restrictions on transfer provided in the Restricted Securities Legend (the
"Restricted Securities Legend") set forth on the Form of Certificates in Exhibit
 ----------------------------
A.  In addition, in the event that a Restricted Security is sold outside the
United States in compliance with Rule 904 under the Securities Act, any

                                       25
<PAGE>

Certificate issued upon registration of transfer of such Restricted Security
shall continue to bear the Restricted Securities Legend set forth on the face of
the Restricted Security, until such time as the transfer restrictions applicable
to such Restricted Security shall cease and terminate as described below.  The
Holder of each Restricted Security, by such Holder's acceptance thereof, agrees
to be bound by such restrictions on transfer.

          (b)  Whenever any Restricted Security other than a Physical
Certificate held by an Institutional Accredited Investor is presented or
surrendered for registration of transfer or exchange for a Certificate
registered in a name other than that of the Holder, such Restricted Security
must be accompanied by a certificate in substantially the form set forth in
Exhibit E hereto, dated the date of such surrender and signed by such Holder, as
to compliance with such restrictions on transfer, upon which the Registrar and
Trustee may rely as to its accuracy with respect to such Holder.

          (c)  Notwithstanding any other provision of this Section 3.10, a
properly completed certificate shall not be required in connection with any
transfer of any Restricted Security through the facilities of the Depository or
any other United States securities clearance and settlement organization,
provided that such transfer does not require a change in the name (other than to
another nominee of the Depository or such other securities clearance and
settlement organization) in which such Restricted Security is then registered.

          (d)  The restrictions imposed by this Section upon the transferability
of any particular Restricted Security shall cease and terminate when such
Restricted Security has been sold pursuant to an effective registration
statement under the Securities Act or transferred pursuant to Rule 144 under the
Securities Act (or any successor provision thereto) or pursuant to any other
available exemption from registration under the Act, unless the Holder thereof
is Enserch Exploration or an affiliate of Enserch Exploration within the meaning
of Rule 144 (or such successor provision).  Any Restricted Security as to which
such restrictions on transfer shall have terminated may, upon surrender of such
Restricted Security for exchange to the Registrar or Trustee in accordance with
the provisions of this Section (accompanied, in the event that such restrictions
on transfer have terminated by reason of a transfer pursuant to Rule 144 (or any
successor provision) or pursuant to any other available exemption from
registration under the Act, by an Opinion of Counsel reasonably acceptable to
Enserch Exploration, addressed to Enserch Exploration and the Trustee and in
form acceptable to Enserch Exploration, to the effect that the transfer of such
Registered Security has been made in compliance with Rule 144 (or such successor
provision) or pursuant to any other available exemption from registration under
the Act), be exchanged for a new Certificate, of like tenor and

                                       26
<PAGE>

aggregate principal amount, which shall not bear the Restricted Securities
Legend. Enserch Exploration shall promptly inform the Registrar and the Trustee
in writing of the effective date of any registration statement registering the
Certificates under the Securities Act. The Registrar and the Trustee shall not
be liable for any action taken or omitted to be taken by it in good faith in
accordance with the aforementioned Opinion of Counsel or registration statement.

               (e)  If the holder of a beneficial interest in a Restricted
     Global Certificate wishes at any time to transfer such interest to a person
     who wishes to take delivery thereof in the form of a beneficial interest in
     a Regulation S Global Certificate, such transfer may be effected, subject
     to the rules and procedures of the Depository for such Global Certificate,
     Euroclear and Cedel, in each case to the extent applicable (the "Applicable
                                                                      ----------
     Procedures"), only in accordance with the provisions of this Section.  Upon
     ----------
     receipt by the Trustee, as Registrar, at the Corporate Trust Office of (1)
     written instructions given in accordance with the Applicable Procedures
     from an Agent Member directing the Trustee to credit or cause to be
     credited to a specified Agent Member's account a beneficial interest in a
     Regulation S Global Certificate in a principal amount equal to that of the
     beneficial interest in the Restricted Global Certificate to be so
     transferred, (2) a written order given in accordance with the Applicable
     Procedures containing information regarding the account of the Agent Member
     (and the Euroclear or Cedel account, as the case may be) to be credited
     with, and the account of the Agent Member to be debited for, such
     beneficial interest and (3) appropriately completed certificates in
     substantially the form set forth in or contemplated by Exhibit D and
     Exhibit E given by the holder of such beneficial interest, the Trustee, as
     Registrar, shall instruct the Depository for such Certificates to reduce
     the principal amount of the Restricted Global Certificate, and to increase
     the principal amount of the Regulation S Global Certificate, by the
     principal amount of the beneficial interest in the Restricted Global
     Certificate to be so transferred, and to credit or cause to be credited to
     the account of the Person specified in such instructions (which shall be
     the Agent Member for Euroclear or Cedel or both, as the case may be) a
     beneficial interest in the Regulation S Global Certificate having a
     principal amount equal to the amount by which the principal amount of the
     Restricted Global Certificate was reduced upon such transfer.

                    (f)  In the case of a proposed transfer of interests in the
          Temporary Regulation S Global Certificate, the Trustee shall register
          the transfer of any such Certificate (x) if the proposed transferee is
          a Non-U.S.

                                       27
<PAGE>

          Person within the meaning of Regulation S and the proposed transferor
          has delivered to the Trustee and Enserch Exploration certificates
          substantially in the form of Exhibit D and Exhibit E hereto or (y) if
          the proposed transferee is a QIB and the proposed transferor has
          delivered to the Trustee and Enserch Exploration a certificate
          substantially in the form of Exhibit E hereto to the effect that the
          sale has been made in compliance with the provisions of Rule 144A.

                    If the proposed transferee is an Agent Member, upon receipt
          by the Trustee of the documents referred to in clause (y) above and
          instructions given in accordance with the Depository's and the
          Trustee's procedures, the Trustee shall reflect on its books and
          records the date and an increase in the principal amount of the
          Restricted Global Certificate in an amount equal to the principal
          amount of the Temporary Regulation S Global Certificate to be
          transferred, and the Trustee shall decrease the like amount of the
          Temporary Regulation S Global Certificate.

               (g)  In the case of a transfer of a Certificate to any
     Institutional Accredited Investor which is not a QIB (excluding Non-U.S.
     Persons), the Registrar shall register the transfer of any Certificate
     whether or not such Certificate bears the Restricted Securities Legend, if
     (x) the requested transfer is at least three years after the later of the
     original issue date of the Restricted Certificates and the last date on
     which such Certificate was held by Enserch Exploration or an affiliate of
     Enserch Exploration or (y) the proposed transferee has delivered (i) to the
     Registrar a certificate substantially in the form of Exhibit F hereto and
     (ii) if requested by Enserch Exploration after consultation with the
     Trustee, an Opinion of Counsel reasonably acceptable to Enserch
     Exploration, addressed to Enserch Exploration and the Trustee in form and
     substance satisfactory to Enserch Exploration to the effect that such
     transfer has been made in compliance with an applicable exemption from the
     registration requirements of the Securities Act.  The Registrar shall not
     be required to accept for registration of transfer or exchange any
     Restricted Security not so accompanied by a properly completed certificate
     and, if requested by Enserch Exploration, an Opinion of Counsel.

               If the proposed transferor is an Agent Member holding a
     beneficial interest in the Restricted Global Certificate, upon receipt by
     the Registrar of (x) the documents, if any, required by the preceding
     paragraph and (y) instructions given in accordance

                                       28
<PAGE>

     with the Depository's and the Registrar's procedures, the Registrar shall
     reflect on its books and records the date and a decrease in the principal
     amount of the Restricted Global Certificate in an amount equal to the
     principal amount of the beneficial interest in the Restricted Global
     Certificate to be transferred, and the Trustee shall execute, authenticate
     and deliver, one or more Restricted Physical Certificates of like tenor and
     amount.

               (h)  If the holder of a Physical Certificate that is a Restricted
     Security wishes at any time to transfer such Certificate to a person who
     wishes to take delivery thereof in the form of a beneficial interest in a
     Global Certificate, such transfer may be effected, subject to the
     Applicable Procedures, only in accordance with this Section.  Upon receipt
     by the Trustee, as Registrar, at the Corporate Trust Office of (1) the
     Restricted Security to be transferred, (2) written instructions given in
     accordance with the Applicable Procedures from an Agent Member directing
     the Trustee to credit or cause to be credited to a specified Agent Member's
     account a beneficial interest in the Global Certificate, in a principal
     amount equal to the principal amount of the Restricted Security to be so
     transferred, (3) a written order given in accordance with the Applicable
     Procedures containing information regarding the account of the Agent Member
     (and, in the case of any transfer pursuant to Regulation S, the Euroclear
     or Cedel account for which such Agent Member's account is held or, if such
     account is held for Euroclear or Cedel, the Euroclear or Cedel account, as
     the case may be) to be credited with such beneficial interest and (4) an
     appropriately completed certificate in substantially the form set forth in
     Exhibit E, the Trustee, as Registrar, shall cancel the Restricted Security,
     and shall authenticate and deliver, a new Physical Certificate for the
     principal amount of the Restricted Security not so transferred, registered
     in the name of the Holder transferring such Restricted Security, and shall
     instruct the Depository for such Certificates to increase the principal
     amount of such Global Certificate, by the remaining principal amount of the
     Restricted Security so transferred, and to credit or cause to be credited
     to the account of the Person specified in such instructions (which, in the
     case of any increase of the principal amount of an Unrestricted Global
     Certificate as the result of a transfer pursuant to Regulation S, shall be
     the Agent Member for Euroclear or Cedel or both, as the case may be) a
     corresponding principal amount of the applicable Global Certificate.  The
     transfer of a Restricted Security to a Person who wishes to take delivery
     thereof in the form of a beneficial interest in a Global Security other
     than a Restricted Global Certificate may be effected only in accordance
     with Regulation S or Rule 144 under the Securities Act.

                                       29
<PAGE>

               (i)  In the case of a transfer of interests in the Permanent
     Regulation S Global Certificate to U.S. Persons within the meaning of
     Regulation S, the Trustee shall give notice to Enserch Exploration of such
     proposed transfer, and thereupon register the transfer of any such
     Certificate without requiring any additional certification except to the
     extent that at the time of such transfer applicable law shall require
     otherwise.

               (j)  By its acceptance of any Certificate bearing the Restricted
     Securities Legend, each Holder of such a Certificate acknowledges the
     restrictions on transfer of such Certificate set forth in this Trust
     Agreement and in the Restricted Securities Legend and agrees that it will
     transfer such Certificate only as provided in this Trust Agreement.  The
     Registrar shall not register a transfer of any Certificate unless such
     transfer complies with the restrictions on transfer of such Certificate set
     forth in this Trust Agreement.  In connection with any transfer of
     Certificates, each Holder agrees by its acceptance of the Certificates to
     furnish the Trustee and Enserch Exploration such certifications, legal
     opinions or other information as required by this Agreement to confirm that
     such transfer is being made pursuant to an exemption from, or a transaction
     not subject to, the registration requirements of the Securities Act;
     provided that the Trustee shall not be required to determine (but may rely
     on a determination made by Enserch Exploration with respect to) the
     sufficiency of any such certifications, legal opinions or other
     information.

               The Trustee shall retain copies of all letters, notices and other
     written communications received pursuant to this Article III.  Enserch
     Exploration shall have the right to inspect and make copies of all such
     letters, notices or other written communications at any reasonable time
     upon the giving of reasonable written notice to the Trustee.

               (k)  As used in this Article III, the term "transfer", for the
     purposes of determining compliance with the Securities Act, encompasses any
     sale, transfer or other disposition of any Certificates referred to herein
     except for , transfers from any Holder to an Affiliate of such Holder;
     provided, however, that such transferring Holder shall deliver a letter to
     --------  -------
     the Trustee stating that the transferee is an Affiliate of such Holder.
     The Trustee shall be entitled to rely on and be fully protected in its
     reliance on such letter.

               Section 3.11.  CUSIP Numbers.  The Trustee in issuing the
                              -------------
     Certificates may use "CUSIP" and "CINS" numbers (if then generally in use),
     and the Trustee shall use CUSIP numbers or

                                       30
<PAGE>

     CINS numbers, as the case may be, in notices of exchange as a convenience
     to Holders; provided that any such notice shall state that no
     representation is made as to the correctness of such numbers either as
     printed on the Certificates or as contained in any notice of exchange and
     that reliance may be placed only on the other identification numbers
     printed on the Certificates.

                                   ARTICLE IV

                DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS

               Section 4.01.  Certificate Account and Special Payments Account.
                              ------------------------------------------------
     (a)  The Trustee shall establish and maintain on behalf of the
     Certificateholders the Certificate Accounts with the Trustee as one or more
     non-interest-bearing accounts.  The Trustee shall hold the Certificate
     Accounts in trust for the benefit of the Certificateholders, and shall make
     or permit withdrawals therefrom only as provided in this Trust Agreement.
     On each day when a Scheduled Payment is made under the Indenture (1996-A)
     to the Trustee, as holder of the Secured Notes issued under such Indenture,
     the Trustee upon receipt shall immediately deposit the aggregate amount of
     such Scheduled Payment in the Certificate Account (1996-A) (the

     "Certificate Account (1996-A)").  On each day when a Scheduled Payment is
     -----------------------------
     made under the Indenture (1996-B) to the Trustee, as holder of the Secured
     Notes issued under such Indenture, the Trustee upon receipt shall
     immediately deposit the aggregate amount of such Scheduled Payment(1996-B)
     in the Certificate Account (1996-B) (the "Certificate Account (1996-B)").
                                               ----------------------------

               (b)  The Trustee shall establish and maintain on behalf of the
     Certificateholders the Special Payments Accounts as one or more accounts,
     which shall be non-interest bearing except as provided in Section 4.04.
     The Trustee shall hold the Special Payments Accounts in trust for the
     benefit of the Certificateholders, and shall make or permit withdrawals
     therefrom only as provided in this Trust Agreement.  On each day when a
     Special Payment (1996-A) (other than a Special Payment (1996-A) that
     represents the proceeds of any sale pursuant to Article VI hereof of a
     Secured Note (1996-A)) is made under the Indenture (1996-A) to the Trustee,
     as holder of the Secured Notes (1996-A) issued under such Indenture, the
     Trustee upon receipt shall immediately deposit the aggregate amount of such
     Special Payments (1996-A) in the Special Payments Account (1996-A).  Upon
     the sale of any Secured Note (1996-A) by the Trustee pursuant to Article VI
     hereof and the realization of any proceeds thereof, the Trustee shall
     deposit the aggregate amount of such proceeds as a

                                       31
<PAGE>

     Special Payment (1996-A) in the Special Payments Account (1996-A). On each
     day when a Special Payment (1996-B) (other than a Special Payment (1996-B)
     that represents the proceeds of any sale pursuant to Article VI hereof of a
     Secured Note (1996-B)) is made under the Indenture (1996-B) to the Trustee,
     as holder of the Secured Notes (1996-B) issued under such Indenture, the
     Trustee upon receipt shall immediately deposit the aggregate amount of such
     Special Payment (1996-B) in the Special Payments Account (1996-B). Upon the
     sale of any Secured Note (1996-B) by the Trustee pursuant to Article VI
     hereof and the realization of any proceeds thereof, the Trustee shall
     deposit the aggregate amount of such proceeds as a Special Payment (1996-B)
     in the Special Payments Account (1996-B).

               (c)  The Trustee shall present to each Indenture Trustee each
     Secured Note issued under the Indenture to which such Indenture Trustee is
     a party on the date of its stated final maturity, or in the case of any
     Secured Note which is to be prepaid in whole pursuant to such Indenture, on
     the applicable prepayment date under such Indenture.

               Section 4.02.  Distributions from Certificate Account and Special
                              --------------------------------------------------
     Payments Account.  (a)  On each Distribution Date or as soon thereafter as
     ----------------
     the Trustee has confirmed receipt of the payment of the Scheduled Payments
     due on the Secured Notes on such date, the Trustee shall distribute out of
     all Certificate Accounts the entire amount deposited therein pursuant to
     Section 4.01(a).  There shall be so distributed to each Certificateholder
     of record on the Record Date with respect to such Distribution Date (other
     than as provided in Section 11.01 concerning the final distribution) by (i)
     check mailed to such Certificateholder at the address appearing in the
     Register or (ii) upon application to the Trustee, by wire transfer in
     immediately available funds to an account maintained by the
     Certificateholder with a bank, such Certificateholder's pro rata share
     (based on the aggregate Fractional Undivided Interest held by such
     Certificateholder) of the aggregate amount in the Certificate Accounts.

               (b)  On each Special Distribution Date with respect to any
     Special Payment or as soon thereafter as the Trustee has confirmed receipt
     of the Special Payments due on the Secured Notes or realized upon the sale
     of any Secured Note, the Trustee shall distribute out of the Special
     Payments Account related to such Secured Notes the entire amount of such
     Special Payment deposited therein pursuant to Section 4.01(b).  There shall
     be so distributed to each Certificateholder of record on the Record Date
     with respect to such Special Distribution Date (other than as provided in
     Section 11.01 concerning the final distribution) by

                                       32
<PAGE>

     (i)  check mailed to such Certificateholder at the address appearing in the
     Register or (ii) upon application to the Trustee, by wire transfer in
     immediately available funds to an account maintained by the
     Certificateholder with a bank, such Certificateholder's pro rata share
     (based on the aggregate Fractional Undivided Interest held by such
     Certificateholder) of the aggregate amount in the Special Payments Account
     on account of such Special Payment.

                 (c)  The Trustee shall at the expense of Enserch Exploration
     cause notice of each Special Payment to be mailed to each Holder of a
     Certificate at his address as it appears in the Register.  In the event of
     prepayment of Secured Notes, such notice shall be mailed not less than 20
     days prior to the date any such Special Payment is scheduled to be
     distributed.  In the case of any other Special Payments, such notice shall
     be mailed as soon as practicable after the Trustee has confirmed that it
     has received funds for such Special Payment.  Notices mailed by the Trustee
     shall set forth:

            (i)       the Special Distribution Date and the Record Date therefor
     (except as otherwise provided in Section 11.01);

            (ii)      the amount of the Special Payment for each $1,000 face
     amount Certificate and the amount thereof constituting principal, premium,
     if any, and interest;

            (iii)     the reason for the Special Payment; and

            (iv)      if the Special Distribution Date is the same date as a
     Distribution Date, the total amount to be received on such date for each
     $1,000 face amount Certificate.

          If the amount of Make-Whole Amount payable upon the prepayment of an
Secured Note has not been calculated at the time that the Trustee mails notice
of a Special Payment, it shall be sufficient if the notice sets forth the other
amounts to be distributed and states that any Make-Whole Amount received will
also be distributed.

          If any redemption of the Secured Notes held in the Trust is canceled,
the Trustee, as soon as possible after learning thereof, shall cause notice
thereof to be mailed to each Certificateholder at its address as it appears on
the Register.

          Section 4.03.  Statements to Certificateholders.  (a)  On each
                         --------------------------------
Distribution Date and Special Distribution Date, if any, the Trustee will
include with each distribution to Certificateholders a statement, giving effect
to such distribution to be made on such

                                       33
<PAGE>

Distribution Date or Special Distribution Date, as the case may be, setting
forth the following information (per a $1,000 face amount Certificate as to (i)
and (ii) below):

            (i)    the amount of such distribution allocable to principal and
     the amount allocable to premium, if any;

            (ii)   the amount of such distribution allocable to interest; and

            (iii)  the Pool Balance and the Pool Factor.

          (b)  Within a reasonable period of time after the end of each calendar
year but not later than the latest date permitted by law, the Trustee shall
furnish to each Person who at any time during such calendar year was a
Certificateholder of record a statement containing the sum of the amounts
determined pursuant to clauses (a)(i) and (a)(ii) with respect to the Trust for
such calendar year or, in the event such Person was a Certificateholder of
record during a portion of such calendar year, for the applicable portion of
such year, and such other items as are readily available to the Trustee and
which a Certificateholder shall reasonably request as necessary for the purpose
of such Certificateholder's preparation of its Federal income tax returns.  Such
report and such other items shall be prepared on the basis of information
supplied to the Trustee by the Agent Members and shall be delivered by the
Trustee to such Agent Members to be available for forwarding by such Agent
Members to beneficial owners of Certificates.

Section 4.04.  Investment of Special Payment Moneys.  Any money received by the
               ------------------------------------
Trustee pursuant to Section 4.01(b) representing a Special Payment which is not
to be promptly distributed shall, to the extent practicable, be invested in
Permitted Government Investments by the Trustee pending distribution of such
Special Payment pursuant to Section 4.02.  Any investment made pursuant to this
Section 4.04 shall be in such Permitted Government Investments having maturities
not later than the date that such moneys are required to be used to make the
payment required under Section 4.02 on the applicable Special Distribution Date
and the Trustee shall hold any such Permitted Government Investments until
maturity.  The Trustee shall have no liability with respect to any investment
made pursuant to this Section 4.04, other than by reason of its willful
misconduct or negligence.  All income and earnings from such investments shall
be distributed on such Special Distribution Date as part of such Special Payment
(and so identified in the statement prepared pursuant to Section 4.03(a)).

                                   ARTICLE V

                                       34
<PAGE>

                              ENSERCH EXPLORATION

          Section 5.01.  Maintenance of Corporate Existence.  Enserch
                         ----------------------------------
Exploration, at its own cost and expense, will do or cause to be done all thing
necessary to preserve and keep in full force and effect its corporate existence,
rights and franchises, except as otherwise specifically permitted in Section
5.02; provided, however, that Enserch Exploration shall not be required to
      --------  -------
preserve any right or franchise if it shall determine that the preservation
thereof is no longer desirable in the conduct of its business and that the loss
thereof is not prejudicial in any material respect to the Certificateholders.

          Section 5.02.  Consolidation, Merger or Sale of Assets Permitted.  (a)
                         -------------------------------------------------
Except as may occur in connection with the Enserch Transactions (as defined in
the Participation Agreements) so long as any of the Secured Notes remain
outstanding, Enserch Exploration shall not merge or consolidate with or into any
other corporation under circumstances where Enserch Exploration is not the
surviving corporation or sell, assign, convey, transfer, lease or otherwise
dispose of all or substantially all of its assets as an entirety to any Person
unless the conditions set forth in Section 10.4 of the Participation Agreements
shall have been satisfied.

          (b)  In case of any such merger, consolidation, sale, conveyance or
other disposition and upon any such assumption by the successor corporation,
such successor corporation shall succeed to and be substituted for Enserch
Exploration hereunder with the same effect as if it had been named herein as the
party of the first part and Enserch Exploration shall be fully released from any
and all further obligations or liabilities hereunder from the time of such
replacement.

          (c)  The Trustee, subject to the provisions of Sections 7.01 and 7.02,
may receive an Officers' Certificate of Enserch Exploration and an Opinion of
Counsel to Enserch Exploration as conclusive evidence that any such
consolidation, merger, sale or conveyance, and any such assumption complies with
the provisions of this Section 5.02.

          Section 5.03.  Annual Statements as to Compliance by Enserch
                         ---------------------------------------------
Exploration.  Enserch Exploration covenants and agrees to deliver to the Trustee
-----------
on or before a date not more than 120 days after the end of each fiscal year
ending after the date hereof, an Officers' Certificate of Enserch Exploration
stating as to the officer signing such certificate, whether or not to the best
of such officer's knowledge, Enserch Exploration, has kept, observed, performed
and fulfilled each and every covenant of it in this Agreement contained and is
in default in the performance and observance of any of the terms, provisions and

                                       35
<PAGE>

conditions hereof, and, if Enserch Exploration shall be in such default,
specifying all such defaults and the nature thereof, of which such officer may
have knowledge.

          Section 5.04.  Availability of Certain Information Concerning Enserch
                         ------------------------------------------------------
Exploration.  So long as any of the Certificates are "restricted securities"
-----------
within the meaning of Rule 144(a)(3) under the Securities Act, Enserch
Exploration, will, if it shall no longer be subject to Section 13 or 15(d) of
the Securities and Exchange Act of 1934, as amended (the "Exchange Act") and is
not exempt from reporting pursuant to Rule 12g3-2(b) under the Exchange Act,
furnish to any Certificateholder upon request, copies of the information
required to be delivered to Certificateholders or prospective purchasers of
Certificates from Certificateholders in order to enable such Certificateholders
to comply with Rule 144A under the Securities Act.

          Section 5.05.  Notification of Certain Enserch Exploration
                         -------------------------------------------
Acquisitions of Certificates.  During the period of three years after the
----------------------------
Closing Date, Enserch Exploration will not, and it will not permit any of its
"affiliates" (as defined in Rule 144 under the Securities Act) to acquire any
beneficial interest in any Certificate unless they notify the Trustee of such
acquisition.  The Trustee and all Certificateholders shall be entitled to rely
without further investigation on any such notification (or the lack thereof).

          Section 5.06.  Representations and Warranties of Enserch Exploration.
                         -----------------------------------------------------
Enserch Exploration hereby represents and warrants that:

            (i)   Enserch Exploration is a corporation duly organized, validly
     existing, and in good standing under the laws of the State of Texas;

            (ii)  The execution, delivery, and performance of this Trust
     Agreement and the Participation Agreements has been duly authorized by all
     necessary corporation action on the part of Enserch Exploration;

            (iii) The execution and delivery by Enserch Exploration of this
     Trust Agreement and the Participation Agreements will not (a) violate any
     provision of any United States or Texas law or regulation governing the
     operations of Enserch Exploration or any order, writ, judgment, or decree
     of any court, arbitrator, or governmental authority applicable to Enserch
     Exploration or any of its assets, the violation of which would materially
     adversely affect the Trust Property or its ability to perform under this
     Trust Agreement or the Participation Agreements, (b) violate any provision
     of its charter documents or by-laws, or (c) contravene

                                       36
<PAGE>

     any provision of, or constitute a default under, or result in the creation
     or imposition of any lien (other than Permitted Liens) on any properties
     included in the Trust Property pursuant to the provisions of any mortgage,
     indenture, contract or other agreement or instrument to which it is a
     party, which violation, default or lien could reasonably be expected to
     have a material adverse effect on Enserch Exploration's ability to perform
     its duties hereunder or thereunder;

            (iv)  the execution, delivery and performance by Enserch Exploration
     of this Trust Agreement and the Participation Agreements will not require
     the authorization, consent, or approval of, the giving of notice to, the
     filing or registration with, or the taking of any other action in respect
     of, any United States or State governmental authority or agency regulating
     the operations of Enserch Exploration; and

            (v)   this Trust Agreement and the Participation Agreements have
     been duly executed and delivered by Enserch Exploration and assuming the
     due authorization, execution and delivery hereof and thereof by the other
     parties hereto and thereto, constitute the legal, valid, and binding
     obligations of Enserch Exploration, enforceable in accordance with their
     respective terms, except as such enforceability may be limited by
     applicable bankruptcy, insolvency, reorganization, moratorium or similar
     laws affecting the rights of creditors generally and by the application of
     general principles of equity.

                                  ARTICLE VI

                                    DEFAULT

          Section 6.01.  Events of Default.  If any Indenture Event of Default
                         -----------------
(1996-A) under Indenture (1996-A) shall occur and be continuing, then, and in
each and every case, so long as such Indenture Event of Default (1996-A) shall
be continuing, the Trustee may vote all of the Secured Notes (1996-A) held in
the Trust, and upon the direction of the holders of Certificates evidencing
Fractional Undivided Interests aggregating not less than a majority in interest
in the Trust, the Trustee shall vote a corresponding majority of such Secured
Notes (1996-A), in favor of directing the Indenture Trustee (1996-A) to declare
the unpaid principal amount of the Secured Notes (1996-A) then outstanding and
accrued interest thereon to be due and payable under, and in accordance with the
provisions of, Indenture (1996-A).  In addition, if an Indenture Event of
Default (1996-A) shall have occurred and be continuing, the Trustee may in
accordance with Indenture (1996-A) vote

                                       37
<PAGE>

the Secured Notes (1996-A) held in the Trust to direct the Indenture Trustee
(1996-A) regarding the exercise of remedies provided in Article IV of Indenture
(1996-A).

          If any Indenture Event of Default (1996-B) under Indenture (1996-B)
shall occur and be continuing, then, and in each and every case, so long as such
Indenture Event of Default (1996-B) shall be continuing, the Trustee may vote
all of the Secured Notes (1996-B) held in the Trust, and upon the direction of
the holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than a majority in interest in the Trust, the Trustee shall
vote a corresponding majority of such Secured Notes (1996-B), in favor of
directing the Indenture Trustee (1996-B) to declare the unpaid principal amount
of the Secured Notes (1996-B) then outstanding and accrued interest thereon to
be due and payable under, and in accordance with the provisions of, Indenture
(1996-B). In addition, if an Indenture Event of Default (1996-B) shall have
occurred and be continuing, the Trustee may in accordance with Indenture (1996-
B) vote the Secured Notes (1996-B) held in the Trust to direct the Indenture
Trustee (1996-B) regarding the exercise of remedies provided in Article IV of
Indenture (1996-B).

          In addition, after any Event of Default shall have occurred and be
continuing, the Trustee may in its discretion, and upon the direction of the
Certificateholders evidencing Fractional Undivided Interests aggregating not
less than a majority in interest in the Trust shall, by such officer or agent as
it may appoint, subject to complying with the terms of the Indenture under which
such Event of Default has occurred and the Secured Notes related to such
Indenture, sell, convey, transfer and deliver such Secured Note or Secured
Notes, without recourse to or warranty by the Trustee or any Certificateholder,
to any Person. In any such case, the Trustee shall sell, assign, contract to
sell or otherwise dispose of and deliver such Secured Note or Secured Notes in
one or more parcels at public or private sale or sales, at any location or
locations at the option of the Trustee, all upon such terms and conditions as it
may reasonably deem advisable and at such prices as it may reasonably deem
advisable, for cash. If the Trustee so decides or is required to sell or
otherwise dispose of any Secured Note pursuant to this Section, the Trustee
shall take such of the actions described above as it may reasonably deem most
effectual to complete the sale or other disposition of such Secured Note, so as
to provide for the payment in full of all amounts due on the Certificates. The
Trustee shall give notice to Enserch Exploration promptly after any such sale.
Notwithstanding the foregoing, any action taken by the Trustee under this
Section shall not, in the reasonable judgment of the Trustee, be adverse to the
best interests of the Certificateholders.

          Section 6.02.  Incidents of Sale of Secured Notes.  Upon any sale of
                         ----------------------------------
all or any part of the Secured Notes made either under the

                                       38
<PAGE>

power of sale given under this Trust Agreement or otherwise for the enforcement
of this Trust Agreement, the following shall be applicable:

          (1)  Certificateholders and Trustee May Purchase Secured Notes.  Any
               ---------------------------------------------------------
     Certificateholder, the Trustee in its individual or any other capacity or
     any other Person may bid for and purchase any of such Secured Notes, and
     upon compliance with the terms of sale, may hold, retain, possess and
     dispose of such Secured Notes in their or its or his own absolute right
     without further accountability.

          (2)  Receipt of Trustee Shall Discharge Purchaser.  The receipt of the
               --------------------------------------------
     Trustee or of the officer making such sale shall be a sufficient discharge
     to any purchaser for his purchase money, and, after paying such purchase
     money and receiving such receipt, such purchaser or his personal
     representative or assigns shall not be obliged to see to the application of
     such purchase money, or be in any way answerable for any loss,
     misapplication or non-application thereof.

          (3)  Application of Moneys Received upon Sale.  Any moneys collected
               ----------------------------------------
     by the Trustee upon any sale made either under the power of sale given by
     this Trust Agreement or otherwise for the enforcement of this Trust
     Agreement, shall be applied as provided in Section 4.02.

          Section 6.03.  Judicial Proceedings Instituted by Trustee.
                         ------------------------------------------

          (a)  Trustee May Bring Suit.  If there shall be a failure to make
               ----------------------
payment of the principal of, premium, if any, or interest on any Secured Note,
or if there shall be any failure to pay Rent (as defined in the applicable
Lease) under such Lease when due and payable, then the Trustee, in its own name,
and as trustee of an express trust, as holder of such Secured Notes or
collateral assignee of such Lease, shall be, to the extent permitted by and in
accordance with the terms of the Note Documents applicable to such Secured Note
or Lease, entitled and empowered to institute any suits, actions or proceedings
at law, in equity or otherwise, for the collection of the sums so due and unpaid
on such Secured Notes or under such Lease any may prosecute any such claim or
proceeding to judgment or final decree with respect to the whole amount of any
such sums so due and unpaid.

          (b)  Trustee May File Proofs of Claim; Appointment of Trustee as
               -----------------------------------------------------------
Attorney-in-Fact in Judicial Proceedings.  The Trustee in its own name, or as
----------------------------------------
trustee of an express trust, or as attorney-in-fact for the Certificateholders,
or in any one or more of such capacities (irrespective of whether distributions
on the Certificates shall then be

                                       39
<PAGE>

due and payable, or the payment of the principal on the Secured Notes shall then
be due and payable, as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand to the Indenture
Trustee for the payment of overdue principal, premium (if any) or interest on
the Secured Notes), shall be entitled and empowered 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 and of the Certificateholders allowed in any
receivership, insolvency, bankruptcy, liquidation, readjustment, reorganization
or any other judicial proceedings relative to any of Enserch Exploration or the
Grantor Trustees or the Owner Participants, their respective creditors or
property. Any receiver, assignee, trustee, liquidator, sequestrator (or similar
official) in any such judicial proceeding is hereby authorized by each
Certificateholder to make payments in respect of such claim to the Trustee, and
in the event that the Trustee shall consent to the making of such payments
directly to the Certificateholders, 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. Nothing contained in this Trust Agreement shall
be deemed to give to the Trustee any right to accept or consent to any plan of
reorganization or otherwise by action of any character in any such proceeding to
waive or change in any way any right of any Certificateholder.

          Section 6.04.  Control by Certificateholders.  The Certificateholders
                         -----------------------------
evidencing Fractional Undivided Interests aggregating not less than a majority
in interest in the Trust shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee under this Trust
Agreement, including any right of the Trustee as holder of the Secured Notes,
provided that:

          (1)  such direction shall not be in conflict with any rule of law or
     with this Trust Agreement and would not involve the Trustee in personal
     liability or expense,

          (2)  the Trustee shall not determine that the action so directed would
     be unjustly prejudicial to the Certificateholders not taking part in such
     direction,

          (3)  the Trustee may take any other action deemed proper by the
     Trustee which is not inconsistent with such direction, and

          (4)  if any Indenture Event of Default shall have occurred and be
     continuing, such direction shall not obligate the Trustee to vote more than
     a corresponding majority of the related Secured Notes held by the Trust in
     favor of directing any action by the Indenture Trustee with respect to such
     Indenture Event of Default.

                                       40
<PAGE>

          Section 6.05.  Waiver of Defaults.  The Certificateholders evidencing
                         ------------------
Fractional Undivided Interests aggregating not less than a majority in interest
in the Trust may on behalf of the Certificateholders of all the Certificates
waive any Default or Event of Default hereunder and its consequences or may
instruct the Trustee in writing to waive any Default pursuant to Section 5.08
under any Indenture and its consequences, except a Default:

          (1)  in the deposit of any Scheduled Payment or Special Payment under
     Section 4.01 or in the distribution of any payment under Section 4.02 on
     the Certificates, or

          (2)  in the payment of the principal of, Make Whole Amount (as defined
     in such Indenture), if any, or interest on any Secured Notes, or

          (3)  in respect of a covenant or provision hereof which under Article
     IX hereof cannot be modified or amended without the consent of the
     Certificateholder of each Outstanding Certificate affected.

Upon any such waiver, such Default shall cease to exist with respect to this
Trust Agreement, and any Event of Default arising therefrom shall be deemed to
have been cured for every purpose of this Trust Agreement and any direction
given by the Trustee on behalf of such Holders to the Indenture Trustee under
the related Indenture shall be annulled with respect thereto; but no such waiver
shall extend to any subsequent or other Default or Event of Default under the
related Indenture or impair any right consequent thereon.  Upon any such waiver,
the Trustee shall vote the Secured Notes issued under the related Indenture to
waive the corresponding Indenture Default or Indenture Event of Default.

          Section 6.06.  Undertaking to Pay Court Costs.  All parties to this
                         ------------------------------
Trust Agreement, and each Certificateholder by his acceptance of a Certificate,
shall be deemed to have agreed that any court may in its discretion require, in
any suit, action or proceeding for the enforcement of any right or remedy under
this Trust Agreement, or in any suit, action or proceeding against the Trustee
for any action taken or omitted by it as Trustee hereunder, the filing by any
party litigant in such suit, action or proceeding of an undertaking to pay the
costs of such suit, action or proceeding, and that such court may, in its
discretion, assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, action or proceeding, having due regard
to the merits and good faith of the claims or defenses made by such party
litigant; provided, however, that the provisions of this Section shall not apply
          --------  -------
to (a) any suit, action or proceeding instituted by any Certificateholder or
group of Certificateholders evidencing Fractional Undivided Interests
aggregating more than 10% of the Trust, (b) any

                                       41
<PAGE>

suit, action or proceeding instituted by any Certificateholder for the
enforcement of the distribution of payments pursuant to Section 4.02 hereof on
or after the respective due dates expressed herein or (c) any suit, action or
proceeding instituted by the Trustee.

          Section 6.07.  Right of Certificateholders to Receive Payments Not to
                         ------------------------------------------------------
Be Impaired.  Anything in this Trust Agreement to the contrary notwithstanding,
-----------
including without limitation Section 6.08 hereof, the right of any
Certificateholder to receive distributions of payments required pursuant to
Section 4.02 hereof on the Certificates when due, or to institute suit for the
enforcement of any such payment on or after the applicable Distribution Date or
Special Distribution Date, shall not be impaired or affected without the consent
of such Certificateholder.

          Section 6.08.  Certificateholders May Not Bring Suit Except Under
                         --------------------------------------------------
Certain Conditions.  A Certificateholder shall not have the right to institute
------------------
any suit, action or proceeding at law or in equity or otherwise with respect to
this Trust Agreement, for the appointment of a receiver or for the enforcement
of any other remedy under this Trust Agreement, unless:

          (1)  such Certificateholder previously shall have given written notice
     to the Trustee of a continuing Event of Default with respect to the related
     Secured Notes;

          (2)  the Certificateholders evidencing Fractional Undivided Interests
     aggregating not less than a majority in interest of the Trust shall have
     requested the Trustee in writing to institute such action, suit or
     proceeding and shall have offered to the Trustee reasonable security or
     indemnity as provided in Section 7.03(e);

          (3)  the Trustee shall have refused or neglected to institute any such
     action, suit or proceeding for 60 days after receipt of such notice,
     request and offer of reasonable security or indemnity; and

          (4)  no direction inconsistent with such written request has been
     given to the Trustee during such 60-day period by the Certificateholders
     evidencing Fractional Undivided Interests aggregating not less than a
     majority in interest in the Trust.

It is understood and intended that no one or more of the Certificateholders
shall have any right in any manner whatever hereunder or under the Certificates
to (i) surrender, impair, waive, affect, disturb or prejudice any property in
the Trust Property or the lien of any Indenture on any property subject thereto,
or the rights of the

                                       42
<PAGE>

Certificateholders or the holders of the Secured Notes, (ii) obtain or seek to
obtain priority over or preference to any other such Holder or (iii) enforce any
right under this Trust Agreement, except in the manner herein provided and for
the equal, ratable and common benefit of all the Certificateholders subject to
the provisions of this Trust Agreement.

          Section 6.09.  Remedies Cumulative.  Every remedy given hereunder to
                         -------------------
the Trustee or to any of the Certificateholders shall not be exclusive of any
other remedy or remedies, and every such remedy shall be cumulative and in
addition to every other remedy given hereunder or now or hereafter given by
statute, law, equity or otherwise.

                                  ARTICLE VII

                                  THE TRUSTEE

          Section 7.01.  Certain Duties and Responsibilities.
                         -----------------------------------

          (a)  Except during the continuance of an Event of Default,

          (1)  the Trustee undertakes to perform such duties as are specifically
     set forth in this Trust Agreement, and no implied covenants or obligations
     shall be read into this Trust Agreement against the Trustee; and

          (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 certificates or opinions furnished to
     the Trustee and conforming to the requirements of this Trust Agreement; but
     in the case of any such certificates or opinions which by any provision
     hereof are specifically required to be furnished to the Trustee, the
     Trustee shall be under a duty to examine the same to determine whether or
     not they conform to the requirements of this Trust Agreement.

          (b)  In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this Trust
Agreement, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.

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

                                       43
<PAGE>

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

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

          (3)  the Trustee shall not be liable with respect to any action taken
     or omitted to be taken by it in good faith in accordance with the direction
     of the Certificateholders evidencing Fractional Undivided Interests
     aggregating not less than a majority in interest in the Trust relating to
     the time, method and place of conducting any proceeding for any remedy
     available to the Trustee, or exercising any trust or power conferred upon
     the Trustee, under this Trust Agreement; and

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

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

          Section 7.02.  Notice of Defaults.  As promptly as practicable after,
                         ------------------
and in any event within 90 days after, the occurrence of any Default hereunder,
the Trustee shall transmit by mail to Enserch Exploration, the related Grantor
Trustee and the related Indenture Trustee in accordance with Section 12.03 and
to all Certificateholders, as their names and addresses appear in the Register,
notice of such Default hereunder known to the Trustee, unless such Default shall
have been cured or waived; provided, however, that, except in the case of a
                           --------  -------
Default in the payment of the principal of, premium, if any, or interest on any
Secured Note, the Trustee shall be protected in withholding such notice if and
so long as the board of directors, the executive committee or a trust committee
of directors and/or Responsible Officers of the Trustee in good faith determine
that the withholding of such notice is in the interests of the
Certificateholders.

                                       44
<PAGE>

          Section 7.03.  Certain Rights of Trustee.  Except as otherwise
                         -------------------------
provided in Section 7.01:

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

          (b)  any request or direction of Enserch Exploration mentioned herein
     shall be sufficiently evidenced by a request;

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

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

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

          (f)  the Trustee shall not be bound to make any investigation into the
     facts or matters stated in any resolution, certificate, statement,
     instrument, opinion, report, notice, request, direction, consent, order,
     bond, debenture or other paper or document; and

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

                                       45
<PAGE>

          Section 7.04.  Not Responsible for Recitals or Issuance of
                         -------------------------------------------
Certificates.  The recitals contained herein and in the Certificates, except the
------------
Trustee's certificates of authentication, shall not be taken as the statements
of the Trustee, and the Trustee assumes no responsibility for their correctness.
Other than pursuant to Section 7.15, the Trustee makes no representations as to
the validity or sufficiency of this Trust Agreement, the Note Documents, the
Indentures, the Secured Notes or the Certificates, except that the Trustee
hereby represents and warrants that this Trust Agreement has been, and each
Certificate will be, executed and delivered by one of its officers who is duly
authorized to execute and deliver such document an its behalf.

          Section 7.05.  May Hold Certificates.  The Trustee, any Paying Agent,
                         ---------------------
Registrar or any other agent, in their respective individual or any other
capacity, may become the owner or pledgee of Certificates and may otherwise deal
with Enserch Exploration, the Grantor Trustees or the Indenture Trustees with
the same rights it would have if it were not Trustee, Paying Agent, Registrar or
such other agent.

          Section 7.06.  Money Held in Trust.  Money held by the Trustee or the
                         -------------------
Paying Agent in trust hereunder need not be segregated from other funds except
to the extent required herein or by law and neither the Trustee nor the Paying
Agent shall have any liability for interest upon any such moneys except as
provided for herein.

          Section 7.07.  Compensation and Reimbursement.  Enserch Exploration
                         ------------------------------
hereby agrees:

          (1)  to pay, or cause to be paid, to the Trustee from time to time the
     compensation set forth in the schedule agreed to by the Trustee and Enserch
     Exploration for all services rendered by it hereunder (which compensation
     shall not be limited by any provision of law in regard to the compensation
     of a trustee of an express trust);

          (2)  except as otherwise expressly provided herein, to reimburse, or
     cause to be reimbursed, the Trustee upon its request for all reasonable
     out-of-pocket expenses, disbursements and advances, including taxes (other
     than taxes measured by the gross receipts or income of the Trustee),
     incurred or made by the Trustee in accordance with any provision of this
     Trust Agreement (including the reasonable compensation and the expenses and
     disbursements of its agents and counsel), except any such expense,
     disbursement or advance as may be attributable to its negligence, willful
     misconduct or bad faith or as may be incurred due to the Trustee's breach
     of its representations and warranties set forth in Section 7.04 or 7.15;

                                       46
<PAGE>

          (3)  to indemnify, or cause to be indemnified, the Trustee in
     accordance with Section 12.1 of the Participation Agreement; the Trustee
     shall notify Enserch Exploration promptly of any claim for which it may
     seek indemnity; and

          (4)  to indemnify, or cause to be indemnified, the Trustee, solely in
     its individual capacity, for, and to hold it harmless against, any tax
     (other than for or with respect to any tax referred to in the next
     paragraph, provided that no indemnification shall be available with respect
     to any tax attributable to the Trustee's compensation for serving as such)
     incurred without negligence, willful misconduct or bad faith, on its part,
     arising out of or in connection with the acceptance or administration of
     this Trust, including any costs and expenses incurred in contesting the
     imposition of any such tax.  The Trustee, in its individual capacity, shall
     notify Enserch Exploration promptly of any tax for which it may seek
     indemnity.  Enserch Exploration shall defend against the imposition of such
     tax and the Trustee, in its individual capacity, shall cooperate in the
     defense.  The Trustee, in its individual capacity, may have separate
     counsel with the consent of Enserch Exploration, and Enserch Exploration
     will pay the reasonable fees and expenses of such counsel.  Enserch
     Exploration need not pay for any taxes paid, in settlement or otherwise,
     without its consent.

In addition, the Trustee shall be entitled to reimbursement from, and shall have
a lien prior to the Certificates upon, all property and funds held or collected
by the Trustee in its capacity as Trustee for any tax incurred without
negligence, bad faith or willful misconduct, on its part, arising out of or in
connection with the acceptance or administration of this Trust (other than any
tax attributable to the Trustee's compensation for serving as such), including
any costs and expenses incurred in contesting the imposition of any such tax.
If the Trustee reimburses itself for any such tax it will within 30 days mail a
brief report setting forth the circumstances thereof to all Certificateholders
as their names and addresses appear in the Register.

          Section 7.08.  Corporate Trustee Required; Eligibility.  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,
authorized under such laws to exercise corporate trust powers, having a combined
capital and surplus of at least $100,000,000, and subject to supervision or
examination by Federal or state authority.  If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purposes of
this Section, the combined capital and surplus of such corporation shall be

                                       47
<PAGE>

deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.

          Section 7.09.  Resignation and Removal; Appointment of Successor.  (a)
                         -------------------------------------------------
No resignation or removal of the Trustee and no appointment of a successor
Trustee pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee under Section 7.10.

          (b)  The Trustee may resign at any time by giving written notice
thereof to Enserch Exploration, the Authorized Agents, the Grantor Trustee and
the Indenture Trustee.  If an instrument of acceptance by a successor Trustee
shall not have been delivered to Enserch Exploration, the Grantor Trustees and
the Indenture Trustees within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee.

          (c)  The Trustee may be removed at any time by Act of the Holders of
Certificates evidencing Fractional Undivided Interests aggregating not less than
a majority in interest in the Trust delivered to the Trustee and to Enserch
Exploration, the Grantor Trustees and the Indenture Trustees.

          (d)  If at any time:

          (1)  the Trustee shall cease to be eligible under Section 7.08 and
     shall fail to resign after written request therefor by Enserch Exploration,
     or by any such Certificateholder; or

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

then, in any case, (i) Enserch Exploration may remove the Trustee or (ii)
subject to Section 6.06, any Certificateholder who has been a bona fide Holder
of a Certificate for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.  If an
instrument of acceptance by a successor Trustee shall not have been delivered to
Enserch Exploration, the Grantor Trustees and the Indenture Trustees within 30
days after giving such

                                       48
<PAGE>

notice of removal, the removed Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee.

          (e)  If a Responsible Officer of the Trustee shall obtain actual
knowledge of an Avoidable Tax (as hereinafter defined) which has been or is
likely to be asserted, the Trustee shall promptly notify Enserch Exploration and
the Grantor Trustees thereof and shall, within 3O days of such notification,
resign hereunder unless within such 3O-day period the Trustee shall have
received notice that Enserch Exploration or the Grantor Trustees has agreed to
pay such tax.  Enserch Exploration shall promptly appoint a successor Trustee in
a jurisdiction where there are no Avoidable Taxes.  As used herein an Avoidable
Tax means a state or local tax:  (i) upon (w) the Trust, (x) the Trust Property,
(y) Holders of the Certificates or (z) the Trustee for which the Trustee is
entitled to seek reimbursement from the Trust Property, and (ii) which would be
avoided if the Trustee were located in another state, or jurisdiction within a
state, within the United States.  A tax shall not be an Avoidable Tax if Enserch
Exploration or the Grantor Trustees shall agree to pay, and shall pay, such tax.

          (f)  If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of the Trustee for any cause,
Enserch Exploration shall promptly appoint a successor Trustee.  If, within one
year after such resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee shall be appointed by Act of the Holders holding
Certificates evidencing Fractional Undivided Interests aggregating not less than
a majority in interest in the Trust delivered to Enserch Exploration, the
Grantor Trustees, the Indenture Trustees and the retiring Trustee, the successor
Trustee so appointed shall, forthwith upon its acceptance of such appointment,
become the successor Trustee and supersede the successor Trustee appointed as
provided above.  If no successor Trustee shall have been so appointed as
provided above and accepted appointment in the manner hereinafter provided, any
Certificateholder who has been a bona fide Holder of a Certificate for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Trustee.

          (g)  The successor Trustee shall give notice of the resignation and
removal of the Trustee and appointment of the successor Trustee by mailing
written notice of such event by first-class mail, postage prepaid, to the
Holders of Certificates as their names and addresses appear in the Register.
Each notice shall include the name of such successor Trustee and the address of
its Corporate Trust Office.

          Section 7.10.  Acceptance of Appointment by Successor.  Every
                         --------------------------------------
successor Trustee appointed hereunder shall execute, acknowledge and deliver to
Enserch Exploration and to the retiring Trustee an

                                       49
<PAGE>

instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on request of
Enserch Exploration or the successor Trustee, such retiring Trustee shall
execute and deliver an instrument transferring to such successor Trustee all the
rights, powers and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder, subject nevertheless to its lien, if any,
provided for in Section 7.07. Upon request of any such successor Trustee,
Enserch Exploration, the retiring Trustee and such successor Trustee shall
execute and deliver any and all instruments containing such provisions as shall
be necessary or desirable to transfer and confirm to, and for more fully and
certainly vesting in, such successor Trustee all such rights, powers and trusts.

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

          Section 7.11.  Merger, Conversion, Consolidation or Succession to
                         --------------------------------------------------
Business.  Any corporation into which the Trustee may be merged or converted or
--------
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto.  In case any Certificates shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Certificates so authenticated with the same
effect as if such successor Trustee had itself authenticated such Certificates.

          Section 7.12.  Maintenance of Agencies.  (a)  There shall at all times
                         -----------------------
be maintained an office or agency where Certificates may be presented or
surrendered for registration of transfer or for exchange, and for payment
thereof and where notices and demands to or upon the Trustee in respect of the
Certificates or of this Trust Agreement may be served.  Such office or agency
shall be initially at The Bank of New York, 101 Barclay Street, Floor 21 West,
New York, New York  10286.  Written notice of the location of each such other
office or agency and of any change of location thereof shall be given by the
Trustee to Enserch Exploration, the Grantor Trustees, the Indenture Trustees and
the Certificateholders.  In the event that no such office or agency shall be
maintained or no such notice of location or of change of location shall be

                                       50
<PAGE>

given, presentations and demands may be made and notices may be served at the
Corporate Trust Office of the Trustee.

          (b)  There shall at all times be a Registrar and a Paying Agent
hereunder.  Each such Authorized Agent shall be a bank or trust company, shall
be a corporation organized and doing business under the laws of the United
States or any state, with a combined capital and surplus of at least
$100,000,000, and shall be authorized under such laws to exercise corporate
trust powers, subject to supervision by Federal or state authorities.  The
Trustee shall initially be the Paying Agent and, as provided in Section 3.04,
Registrar hereunder.  Each Registrar shall furnish to the Trustee, at stated
intervals of not more than six months, and at such other times as the Trustee
may request in writing, a copy of the Register.

          (c)  Any corporation into which any Authorized Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any Authorized Agent shall
be a party, or any corporation succeeding to substantially all of the corporate
trust business of any Authorized Agent, shall be the successor of such
Authorized Agent hereunder, if such successor corporation is otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the parties hereto or such Authorized Agent or such successor
corporation.

          (d)  Any Authorized Agent may at any time resign by giving written
notice of resignation to the Trustee, Enserch Exploration, the Grantor Trustees
and the Indenture Trustees.  Enserch Exploration may, and at the request of the
Trustee shall, at any time terminate the agency of any Authorized Agent by
giving written notice of termination to such Authorized Agent and to the
Trustee.  Upon the resignation or termination of an Authorized Agent or in case
at any time any such Authorized Agent shall cease to be eligible under this
Section (when, in either case, no other Authorized Agent performing the
functions of such Authorized Agent shall have been appointed), Enserch
Exploration shall promptly appoint one or more qualified successor Authorized
Agents, reasonably satisfactory to the Trustee, to perform the functions of the
Authorized Agent which has resigned or whose agency has been terminated or who
shall have ceased to be eligible under this Section.  Enserch Exploration shall
give written notice of any such appointment made by it to the Trustee, the
Grantor Trustees and the Indenture Trustees; and in each case the Trustee shall
mail notice of such appointment to all Holders as their names and addressee
appear on the Register.

          (e)  Enserch Exploration agrees to pay, or cause to be paid, from time
to time to each Authorized Agent the compensation as set forth in the schedule
agreed to by each Authorized Agent and Enserch

                                       51
<PAGE>

Exploration for its services and to reimburse it for its reasonable expenses.

          Section 7.13.  Money for Certificate Payments to Be Held in Trust.
                         --------------------------------------------------
All moneys deposited with any Paying Agent for the purpose of any payment on
Certificates shall be deposited and held in trust for the benefit of the Holders
of the Certificates entitled to such payment, subject to the provisions of this
Section.  Moneys so deposited and held in trust shall constitute a separate
trust fund for the benefit of the Holders of the Certificates with respect to
which such money was deposited.

          The Trustee will cause each Paying Agent other than the Trustee to
execute and deliver to it an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section, that such Paying
Agent will:

          (1)  hold all sums held by it for payments on Certificates in trust
     for the benefit of the Persons entitled thereto until such sums shall be
     paid to such Persons or otherwise disposed of as herein provided;

          (2)  give the Trustee notice of any default by any obligor upon the
     Certificates in the making of any such payment; and

          (3)  at any time during the continuance of any such default, upon the
     written request of the Trustee, forthwith pay to the Trustee all sums so
     held in trust by such Paying Agent.

The Trustee may at any time, for the purpose of obtaining the satisfaction and
discharge of this Trust Agreement or for any other purpose, direct any Paying
Agent to pay to the Trustee all sums held in trust by such Paying Agent, such
sums to be held by the Trustee upon the same trusts as those upon which such
sums were held by such Paying Agent; and, upon such payment by any Paying Agent
to the Trustee, such Paying Agent shall be released from all further liability
with respect to such money.

          Section 7.14.  Registration of Secured Notes in Trustee's Name.  The
                         -----------------------------------------------
Trustee agrees that all Secured Notes and Permitted Government Investments, if
any, shall be issued in the name of the Trustee or its nominee and held by the
Trustee, or, if not so held, the Trustee or its nominee shall be reflected as
the owner of such Secured Notes or Permitted Government Investments, as the case
may be, in the register of the issuer of such Secured Notes or Permitted
Government Investments under the applicable provisions of the Uniform Commercial

                                       52
<PAGE>

Code in effect where the Trustee holds such Secured Notes or Permitted
Government Investments, or other applicable law then in effect.

          Section 7.15.  Representations and Warranties of Trustee.  The Trustee
                         -----------------------------------------
hereby represents and warrants that:

            (i)   the Trustee is a banking corporation duly organized, validly
     existing, and in good standing under the laws of the State of New York;

            (ii)  the Trustee has full power, authority and legal right to
     execute, deliver, and perform this Trust Agreement and the Participation
     Agreement and has taken all necessary action to authorize the execution,
     delivery, and performance by it of this Trust Agreement and the
     Participation Agreement;

            (iii) the execution, delivery and performance by the Trustee of this
     Trust Agreement and the Participation Agreement (a) will not violate any
     provision of any United States or New York law or regulation governing the
     banking and trust powers of the Trustee or any order, writ, judgment, or
     decree of any court, arbitrator, or governmental authority applicable to
     the Trustee or any of its assets, (b) will not violate any provision of the
     articles of association or by-laws of the Trustee, or (c) will not violate
     any provision of, or constitute, with or without notice or lapse of time or
     both, a default under, or result in the creation or imposition of any lien
     on any properties included in the Trust Property pursuant to the provisions
     of any mortgage, indenture, contract, agreement or other undertaking to
     which it is a party, which violation, default or lien could reasonably be
     expected to have an adverse effect on the Trustee's performance or ability
     to perform its duties hereunder or thereunder or on the transactions
     contemplated herein or therein;

            (iv)  the execution, delivery and performance by the Trustee of this
     Trust Agreement and the Participation Agreement will not require the
     authorization, consent, or approval of, the giving of notice to, the filing
     or registration with, or the taking of any other action in respect of, any
     United States or State governmental authority or agency regulating the
     banking and corporate trust activities of the Trustee; and

            (v)   this Trust Agreement and the Participation Agreement have been
     duly executed and delivered by the Trustee and constitute the legal, valid,
     and binding agreements of the Trustee, enforceable in accordance with their
     respective terms, provided that enforceability may be limited by applicable
     bankruptcy, insolvency,

                                       53
<PAGE>

     reorganization, moratorium or similar laws affecting the rights of
     creditors generally and general principles of equity.

          Section 7.16.  Withholding Taxes; Information Reporting.  The Trustee,
                         ----------------------------------------
as trustee of a grantor trust, shall exclude and withhold from each distribution
of principal, premium, if any, and interest and other amounts due hereunder or
under the Certificates any and all withholding taxes applicable thereto as
required by law.  The Trustee agrees to act as such withholding agent and, in
connection therewith, whenever any present or future taxes or similar charges
are required to be withheld with respect to any amounts payable in respect of
the Certificates, to withhold such amounts and timely pay the same to the
appropriate authority in the name of and on behalf of the holders of the
Certificates, that it will file any necessary withholding tax returns or
statements when due, and that, as promptly as possible after the payment
thereof, it will deliver to each Holder of a Certificate appropriate
documentation showing the payment thereof, together with such additional
documentary evidence as such Holder may reasonably request from time to time.
The Trustee agrees to file any other information reports as it may be required
to file under United States law.

          Section 7.17.  Trustee's Liens.  The Trustee, in its individual
                         ---------------
capacity, agrees that it will at its own cost and expense promptly take any
action as may be necessary to duly discharge and satisfy in full any mortgage,
pledge, lien, charge, encumbrance, security interest or claim ("Trustee's
                                                                ---------
Liens") on or with respect to the Trust Property which is either (i)
-----
attributable to the Trustee in its individual capacity and which is unrelated to
the transactions contemplated by this Trust Agreement, the Participation
Agreement or the Note Documents, or (ii) which is attributable to the Trustee as
trustee hereunder or in its individual capacity and which arise out of acts or
omissions which are prohibited by this Trust Agreement.

          Section 7.18.  Availability of Certain Information Concerning the
                         --------------------------------------------------
Trust.  The Trustee shall furnish to any Certificateholder upon request, copies
-----
of the information with respect to the Trust required to be delivered to
Certificateholders or prospective purchasers of Certificates from
Certificateholders in order to enable such Certificateholders to comply with
Rule 144A under the Securities Act.

                                  ARTICLE VIII

                CERTIFICATEHOLDERS' LISTS AND REPORTS BY TRUSTEE

          Section 8.01.  Enserch Exploration to Furnish Trustee with Names and
                         -----------------------------------------------------
Addresses of Certificateholders.  Enserch Exploration will
-------------------------------

                                       54
<PAGE>

furnish to the Trustee within 15 days after each Record Date with respect to a
Scheduled Payment, and at such other times as the Trustee may request in
writing, within 30 days after receipt by Enserch Exploration of any such
request, a list, in such form as the Trustee may reasonably require, of all
information in the possession or control of Enserch Exploration as to the names
and addresses of the Holders of Certificates, in each case as of a date not more
than 15 days prior to the time such list is furnished; provided, however, that
                                                       --------  -------
so long as the Trustee is the sole Registrar, no such list need be furnished;
and provided further, however, that no such list need be furnished for so long
as a copy of the Register is being furnished to the Trustee pursuant to Section
7.12(b).

          Section 8.02.  Preservation of Information; Communication to
                         ---------------------------------------------
Certificateholders.  (a)  The Trustee shall preserve, in as current a form as is
------------------
reasonably practicable, the names and addresses of Holders of Certificates
contained in the most recent list furnished to the Trustee as provided in
Section 7.12(b) or Section 8.01, as the case may be, and the names and addresses
of Holders of Certificates received by the Trustee in its capacity as Registrar,
if so acting.  The Trustee may destroy any list furnished to it as provided in
Section 7.12(b) or Section 8.01, as the case may be, upon receipt of a new list
so furnished.

          (b)  If three or more Holders of Certificates (such Holders
hereinafter referred to as "applicants") apply in writing to the Trustee, and
furnish to the Trustee reasonable proof that each such applicant has owned a
Certificate for a period of at least six months preceding the date of such
application, and such application states that the applicants desire to
communicate with other Holders of Certificates with respect to their rights
under this Trust Agreement or under the Certificates and is accompanied by a
copy of the form of proxy or other communication which such applicants propose
to transmit, then the Trustee shall, within 5 Business Days after the receipt of
such application, at its election, either:

            (i)   afford such applicants access to the information preserved at
     the time by the Trustee in accordance with Section 8.02(a), or

            (ii)  inform such applicants as to the approximate number of Holders
     of Certificates whose names and addresses appear in the information
     preserved at the time by the Trustee in accordance with Section 8.02(a),
     and as to the approximate cost of mailing to such Certificateholders the
     form of proxy or other communication, if any, specified in such
     application.

If the Trustee shall elect not to afford such applicants access to such
information, the Trustee shall, upon the written request of such

                                       55
<PAGE>

applicants, mail to each Certificateholder whose name and address appear in the
information preserved at the time by the Trustee in accordance with Section
8.02(a), a copy of the form of proxy or other communication which is specified
in such request, with reasonable promptness after a tender to the Trustee of the
material to be mailed and of payment, or provision for the payment, of the
reasonable expenses of mailing, unless within five days after such tender, the
Trustee shall mail to such applicants, together with a copy of the material to
be mailed, a written statement to the effect that, in the opinion of the
Trustee, such mailing would be contrary to the best interests of the Holders of
Certificates or would be in violation of applicable law. Such written statement
shall specify the basis of such opinion. If the applicants shall obtain a court
order, after notice to the Trustee and opportunity for hearing, so directing the
Trustee, the Trustee shall mail copies of such material to all such
Certificateholders with reasonable promptness after the entry of such order and
the renewal of the applicants' tender.

          (c)  Every Holder of Certificates, by receiving and holding the same,
agrees with Enserch Exploration and the Trustee that none of Enserch Exploration
or the Trustee shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders of Certificates in
accordance with Section 8.02(b), regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under Section 8.02(b).

          Section 8.03.  Reports by Enserch Exploration.  Enserch Exploration
                         ------------------------------
will:

          (1)  file with the Trustee the information required by Section 10.2 of
     the Participation Agreement; and

          (2)  transmit by mail to all Certificateholders, as their names and
     addresses appear in the Register, within 3O days after the filing thereof
     with the Trustee, such summaries of any information documents and reports
     required to be filed by Enserch Exploration pursuant to paragraph (1) of
     this Section as may hereafter be required by rules and regulations
     prescribed from time to time by the Commission.

                                   ARTICLE IX

                         SUPPLEMENTAL TRUST AGREEMENTS

          Section 9.01.  Supplemental Trust Agreement Without Consent of
                         -----------------------------------------------
Certificateholders.  Without the consent of the Holder of any
------------------

                                       56
<PAGE>

Certificates, Enserch Exploration may, and the Trustee (subject to Section 9.03)
shall, at any time and from time to time enter into one or more agreements
supplemental hereto, in form satisfactory to the Trustee, for any of the
following purposes:

          (1)  to evidence the succession of another corporation to Enserch
     Exploration, and the assumption by any such successor of the covenants of
     Enserch Exploration, as applicable, herein contained; or

          (2)  to add to the covenants of Enserch Exploration, for the benefit
     of the Holders of the Certificates, or to surrender any right or power
     herein conferred upon Enserch Exploration; or

          (3)  to cure any ambiguity, to correct or supplement any provision
     herein which may be defective or inconsistent with any other provision
     herein or to make any other provisions with respect to matters or questions
     arising under this Trust Agreement; provided that any such action shall not
     adversely affect the interests of the Holders of the Certificates; or

          (4)  to modify, eliminate or add to the provisions of this Trust
     Agreement to such extent as shall be necessary to qualify this Trust
     Agreement (including any supplemental agreement) under the Trust Indenture
     Act, or under any similar Federal statute hereafter enacted, and to add to
     this Trust Agreement such other provisions as may be expressly permitted by
     the Trust Indenture Act, excluding, however, the provisions referred to in
     Section 316(a)(2) of the Trust Indenture Act as in effect at the date as of
     which this instrument was executed or any corresponding provision in any
     similar Federal statute hereafter enacted.

          Section 9.02.  Supplemental Trust Agreements with Consent of
                         ---------------------------------------------
Certificateholders.  With the consent of the Holders of Certificates evidencing
------------------
Fractional Undivided Interests aggregating not less than a majority in interest
in the Trust, by Act of said Holders delivered to Enserch Exploration and the
Trustee, Enserch Exploration may (with the consent of the Grantor Trustees, such
consent not to be unreasonably withheld), and the Trustee (subject to Section
9.03) shall, enter into an agreement or agreements supplemental hereto for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Trust Agreement or of modifying in any manner the
rights and obligations of the Holders of the Certificates under this Trust
Agreement; provided, however, that no such supplemental agreement shall, without
           --------  -------
the consent of the Holder of each Outstanding Certificate affected thereby:

                                       57
<PAGE>

          (1)  reduce in any manner the amount of, or delay the timing of, any
     receipt by the Trustee of payments on the Secured Notes or distributions
     that are required to be made herein on any Certificate, or change any date
     of payment on any Certificate, or change the place of payment where, or the
     coin or currency in which, any Certificate is payable, or impair the right
     to institute suit for the enforcement of any such payment or distribution
     on or after the Distribution Date or Special Distribution Date applicable
     thereto; or

          (2)  permit the disposition of any Secured Note in the Trust Property
     except as permitted by this Trust Agreement, or otherwise deprive any
     Certificateholder of the benefit of the ownership of the Secured Notes in
     the Trust; or

          (3)  reduce the percentage of the aggregate Fractional Undivided
     Interests of the Trust which is required for any such supplemental
     agreement, or reduce such percentage required for any waiver (of compliance
     with certain provisions of this Trust Agreement or certain defaults
     hereunder and their consequences) provided for in this Trust Agreement; or

          (4)  modify any of the provisions of this Section or Section 6.05,
     except to increase any such percentage or to provide that certain other
     provisions of this Trust Agreement cannot be modified or waived without the
     consent of the Holder of each Certificate affected thereby.

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

          Section 9.03.  Documents Affecting Immunity or Indemnity.  If in the
                         -----------------------------------------
opinion of the Trustee any document required to be executed by it pursuant to
the terms of Section 9.01 or 9.02 affects any interest, right, duty, immunity or
indemnity in favor of the Trustee under this Trust Agreement, the Trustee may in
its discretion decline to execute such document.

          Section 9.04.  Execution of Supplemental Trust Agreements.  In
                         ------------------------------------------
executing, or accepting the additional trusts created by, any supplemental
agreement permitted by this Article or the modifications thereby of the trusts
created by this Trust Agreement, the Trustee shall be entitled to receive, and
(subject to Section 7.01) shall be fully protected in relying upon, an Opinion
of Counsel stating that the

                                      58
<PAGE>

execution of such supplemental agreement is authorized or permitted by this
Trust Agreement.

          Section 9.05.  Effect of Supplemental Trust Agreements.  Upon the
                         ---------------------------------------
execution of any supplemental agreement under this Article, this Trust Agreement
shall be modified in accordance therewith, and such supplemental agreement shall
form a part of this Trust Agreement for all purposes; and every Holder of
Certificates theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.

          Section 9.06.  Reference in Certificates to Supplemental Trust
                         -----------------------------------------------
Agreements.  Certificates authenticated and delivered after the execution of any
----------
supplemental agreement pursuant to this Article may bear a notation in form
approved by the Trustee as to any matter provided for in such supplemental
agreement; and, in such case, suitable notation may be made upon Outstanding
Certificates after proper presentation and demand.

                                   ARTICLE X

                  AMENDMENTS TO INDENTURES AND NOTE DOCUMENTS

          Section 10.01.  Amendments and Supplements to Indenture and Other Note
                          ------------------------------------------------------
Documents.  In the event that the Trustee, as holder of any Secured Note in
---------
trust for the benefit of the Certificateholders, receives a request for a
consent to any amendment, modification, waiver or supplement under any Indenture
or other Note Document or any Participation Agreement, which requires the
consent of the Certificateholders, the Trustee shall forthwith send a notice of
such proposed amendment, modification, waiver or supplement, to each
Certificateholder registered on the Register as of such date.  The Trustee shall
request from the Certificateholders Directions as to (i) whether or not to
direct the Indenture Trustee related to such Secured Note to take or refrain
from taking any action which a holder of such Secured Note has the option to
direct, (ii) whether or not to give or execute any waivers, consents,
amendments, modifications or supplements as a holder of such Secured Note and
(iii) how to vote such Secured Note if a vote has been called for with respect
thereto.  Provided such a request for Certificateholder Direction shall have
been made, in directing any action or casting any vote or giving any consent as
the holder of any Secured Note, the Trustee shall vote or consent with respect
to such Secured Note in the same proportion as the Certificates were actually
voted by Acts of Holders delivered to the Trustee prior to two Business Days
before the Trustee directs such action or casts such vote or gives such consent.
Notwithstanding the foregoing, but subject to Section 6.04, in the case that an
Event of Default hereunder shall have occurred and be continuing, the Trustee
may, but shall not be

                                      59
<PAGE>

obligated to, consent and notify the Indenture Trustee under the Indenture to
which such Event of Default pertains of such consent to any amendment,
modification, waiver or supplement under such Indenture or other Note Document.
Notwithstanding anything else set forth in this Trust Agreement, until the Lease
Termination Date, the Trustee shall not, without the express written consent of
the respective Owner Participant, vote or consent to (i) any amendment or
modification to Section 10.8 of the Participation Agreements, (ii) any other
amendment or modification to the Participation Agreements or any other Operative
Document, the effect of which would be to amend, modify or override Section 10.8
of the Participation Agreements or (iii) amend, modify or override this
sentence.

                                  ARTICLE XI

                             TERMINATION OF TRUST

          Section 11.01.  Termination of the Trust.  The respective obligations
                          ------------------------
and responsibilities of Enserch Exploration and the Trustee created hereby and
the Trust created hereby shall terminate upon the distribution to all
Certificateholders of all amounts required to be distributed to them pursuant to
this Trust Agreement and the disposition of all property held as part of the
Trust Property; provided, however, that in no event shall the trust created
                --------  -------
hereby continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of William Jefferson Clinton, President of the
United States, living on the date of this Trust Agreement.

          Notice of any termination, specifying the Distribution Date (or
Special Distribution Date, as the case may be) upon which the Certificateholders
may surrender their Certificates to the Trustee for payment of the final
distribution and cancellation, shall be mailed promptly by the Trustee to
Certificateholders not earlier than the 60th day and not later than the 20th day
next preceding such final distribution specifying (A) the Distribution Date (or
Special Distribution Date, as the case may be) upon which final payment of the
Certificates will be made upon presentation and surrender of Certificates at the
office or agency of the Trustee therein specified, (B) the amount of any such
final payment, and (C) that the Record Date otherwise applicable to such
Distribution Date (or Special Distribution Date, as the case may be) is not
applicable, payments being made only upon presentation and surrender of the
Certificates at the office or agency of the Trustee therein specified.  The
Trustee shall give such notice to the Registrar at the time such notice is given
to Certificateholders.  Upon presentation and surrender of the Certificates, the
Trustee shall cause to be distributed to Certificateholders amounts
distributable on such Distribution Date or

                                      60
<PAGE>

Special Distribution Date, as the case may be, pursuant to Section 4.02.

          In the event that all of the Certificateholders shall not surrender
their Certificates for cancellation within six months after the date specified
in the above-mentioned written notice, the Trustee shall give a second written
notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto.  In the
event that any money held by the Trustee for the payment of distributions on the
Certificates shall remain unclaimed for two years (or such lesser time as the
Trustee shall be satisfied, after sixty days' notice from Enserch Exploration,
is one month prior to the escheat period provided under applicable law) after
the final distribution date with respect thereto, the Trustee shall pay to
Indenture Trustees the appropriate amount of money relating to such Indenture
Trustee and shall give written notice thereof to the Grantor Trustees, Enserch
Exploration.

                                  ARTICLE XII

                           MISCELLANEOUS PROVISIONS

          Section 12.01.  Limitation on Rights of Certificateholders.  The death
                          ------------------------------------------
or incapacity of any Certificateholder shall not operate to terminate this Trust
Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the Trust,
nor otherwise affect the rights, obligations, and liabilities of the parties
hereto or any of them.

          Section 12.02.  Certificates Nonassessable and Fully Paid.
                          -----------------------------------------
Certificateholders shall not be personally liable for obligations of the Trust,
the Fractional Undivided Interests represented by the Certificates shall be
nonassessable for any losses or expenses of the Trust or for any reason
whatsoever, and Certificates upon authentication thereof by the Trustee pursuant
to Section 3.02 are and shall be deemed fully paid.  No Certificateholder shall
have any right (except as expressly provided herein) to vote or in any manner
otherwise control the operation and management of the Trust Property, the Trust
established hereunder, or the obligations of the parties hereto, nor shall
anything set forth herein, or contained in the terms of the Certificates, be
construed so as to constitute the Certificateholders from time to time as
partners or members of an association.

          Section 12.03.  Notices.  All demands, notices, and communications
                          -------
hereunder shall be in writing, personally delivered or mailed by certified mail-
return receipt requested, and shall be deemed to

                                      61
<PAGE>

have been duly given upon receipt, in the case of Enserch Exploration, at the
following address: Enserch Exploration, Inc., ENSERCH Center, 300 South St. Paul
Street, Dallas, Texas 75201, Attention: Treasurer, and, in the case of the
Trustee, at the following address: 101 Barclay Street, Floor 21 West, New York,
New York 10284, Attention: Corporate Trust Administration or, in each case, at
such other address as shall be designated by such party in a written notice to
the other parties. Any notice required or permitted to be given to a
Certificateholder hereunder shall be mailed by first class mail, postage
prepaid, at the address of such Holder as shown in the Register. Any notice so
mailed within the time prescribed in this Trust Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder received
such notice. The Trustee shall promptly furnish Enserch Exploration with a copy
of each demand, notice or written communication received by the Trustee
hereunder from any Certificateholder, the Grantor Trustee or the Indenture
Trustee.

          Section 12.04.  Governing Law.  THIS TRUST AGREEMENT AND THE
                          -------------
CERTIFICATES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES.

          Section 12.05.  Severability of Provisions.  If any one or more of the
                          --------------------------
covenants, agreements, provisions, or terms of this Trust Agreement shall be for
any reason whatsoever held invalid, then such covenants, agreements, provisions,
or terms shall be deemed severable from the remaining covenants, agreements,
provisions, or terms of this Trust Agreement and shall in no way affect the
validity or enforceability of the other provisions of this Trust Agreement or
the Trust, or of the Certificates or the rights of the Holders thereof.

          Section 12.06.  Effect of Headings and Table of Contents.  The Article
                          ----------------------------------------
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.

          Section 12.07.  Successors and Assigns.  All covenants, agreements,
                          ----------------------
representations and warranties in this Trust Agreement by the Trustee, Enserch
Exploration shall bind and, to the extent permitted hereby, shall inure to the
benefit of and be enforceable by their respective successors and assigns,
whether so expressed or not.

          Section 12.08.  Benefits of Trust Agreement.  Nothing in this Trust
                          ---------------------------
Agreement or in the Certificates, express or implied, shall give to any person,
other than the parties hereto and their successors hereunder, and the Holders of
Certificates, any benefit or any legal or equitable right, remedy or claim under
this Trust Agreement.

                                      62
<PAGE>

          Section 12.09.  Legal Holidays.  In any case where any Distribution
                          --------------
Date or Special Distribution Date relating to any Certificate shall not be a
Business Day, then (notwithstanding any other provision of this Trust Agreement)
payment need not be made on such date, but may be made on the next succeeding
Business Day with the same force and effect as if made on such Distribution Date
or Special Distribution Date, and no interest shall accrue during the
intervening period.

          Section 12.10.  Counterparts.  For the purpose of facilitating the
                          ------------
execution of this Trust Agreement and for other purposes, this Trust Agreement
may be executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.

                                   * * * * *

                                      63
<PAGE>

IN WITNESS WHEREOF, Enserch Exploration and the Trustee have caused this Trust
Agreement to be duly executed by their respective officers and their respective
seals, duly attested, to be hereunto affixed, all as of the day and year first
                                above written.

                                  ENSERCH EXPLORATION, INC.

                                  By: /s/ Joseph T. Leary
                                      ---------------------------------
                                      Name: Joseph T. Leary
                                      Title: Vice President
                                             Finance and Treasurer

SEAL

Attest:

/s/ R. L. Jay
----------------------
Name: R. L. Jay
Title: Asst. Corporate Secretary

                                  The Bank of New York, as Trustee

                                  By: /s/ Stephen J. Giurlando
                                      ---------------------------------
                                      Name: Stephen J. Giurlando
                                      Title: Assistant Vice President

SEAL

Attest:

/s/ F. W. Clark
----------------------
Name: F. W. Clark
Title: Vice President

                                      64

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