Document:

<PAGE>   1

                                                               [EXECUTION COPY]
                                                                    EXHIBIT 4.1

                                  PPL CAPITAL FUNDING, INC.,
                                            ISSUER

                                             AND

                                       PPL CORPORATION,
                                          GUARANTOR

                                              TO

                                  THE CHASE MANHATTAN BANK,
                                           TRUSTEE

                                          ---------

                                    SUBORDINATED INDENTURE

                                   DATED AS OF MAY 9, 2001

<PAGE>   2

                                TABLE OF CONTENTS

<TABLE>
<S>                                                                                         <C>
PARTIES .....................................................................................1

ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION..........................1
   SECTION 101. Definitions..................................................................1
   SECTION 102. Compliance Certificates and Opinions.........................................9
   SECTION 103. Form of Documents Delivered to Trustee......................................10
   SECTION 104. Acts of Holders.............................................................11
   SECTION 105. Notices, Etc. to Trustee, Company or Guarantor..............................12
   SECTION 106. Notice to Holders of Securities; Waiver.....................................14
   SECTION 107. Conflict with Trust Indenture Act...........................................14
   SECTION 108. Effect of Headings and Table of Contents....................................14
   SECTION 109. Successors and Assigns......................................................14
   SECTION 110. Separability Clause.........................................................15
   SECTION 111. Benefits of Indenture.......................................................15
   SECTION 112. Governing Law...............................................................15
   SECTION 113. Legal Holidays..............................................................15

ARTICLE TWO SECURITY FORMS .................................................................16
   SECTION 201. Forms Generally.............................................................16
   SECTION 202. Form of Trustee's Certificate of Authentication.............................16

ARTICLE THREE THE SECURITIES ...............................................................17
   SECTION 301. Amount Unlimited; Issuable in Series........................................17
   SECTION 302. Denominations...............................................................20
   SECTION 303. Execution, Authentication, Delivery and Dating..............................20
   SECTION 304. Temporary Securities........................................................24
   SECTION 305. Registration, Registration of Transfer and Exchange.........................24
   SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities............................25
   SECTION 307. Payment of Interest; Interest Rights Preserved..............................26
   SECTION 308. Persons Deemed Owners.......................................................27
   SECTION 309. Cancellation................................................................28
   SECTION 310. Computation of Interest.....................................................28
   SECTION 311. Payment to Be in Proper Currency............................................28
   SECTION 312. Extension of Interest Payment...............................................28

ARTICLE FOUR REDEMPTION OF SECURITIES.......................................................29
   SECTION 401. Applicability of Article....................................................29
   SECTION 402. Election to Redeem; Notice to Trustee.......................................29
   SECTION 403. Selection of Securities to Be Redeemed......................................29
   SECTION 404. Notice of Redemption........................................................30
   SECTION 405. Securities Payable on Redemption Date.......................................31
   SECTION 406. Securities Redeemed in Part.................................................31

ARTICLE FIVE SINKING FUNDS .................................................................32
   SECTION 501. Applicability of Article....................................................32
</TABLE>

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<TABLE>
<S>                                                                                        <C>
   SECTION 502. Satisfaction of Sinking Fund Payments with Securities.......................32
   SECTION 503. Redemption of Securities for Sinking Fund...................................32

ARTICLE SIX COVENANTS ......................................................................33
   SECTION 601. Payment of Principal, Premium and Interest..................................33
   SECTION 602. Maintenance of Office or Agency.............................................33
   SECTION 603. Money for Securities Payments to Be Held in Trust...........................34
   SECTION 604. Corporate Existence.........................................................35
   SECTION 605. Annual Officer's Certificate................................................35
   SECTION 606. Waiver of Certain Covenants.................................................36
   SECTION 607. Restriction on Payment of Dividends.........................................36
   SECTION 608. Maintenance of Trust Existence..............................................37
   SECTION 609. Rights of Holders of Preferred Securities...................................37
   SECTION 610. Payment of Trust Costs and Expenses.........................................37

ARTICLE SEVEN SATISFACTION AND DISCHARGE....................................................38
   SECTION 701. Satisfaction and Discharge of Securities....................................38
   SECTION 702. Satisfaction and Discharge of Indenture.....................................40
   SECTION 703. Application of Trust Money..................................................41
   SECTION 704. Reinstatement...............................................................41

ARTICLE EIGHT EVENTS OF DEFAULT; REMEDIES...................................................41
   SECTION 801. Events of Default...........................................................41
   SECTION 802. Acceleration of Maturity; Rescission and Annulment..........................43
   SECTION 803. Collection of Indebtedness and Suits for Enforcement by Trustee.............44
   SECTION 804. Trustee May File Proofs of Claim............................................45
   SECTION 805. Trustee May Enforce Claims Without Possession of Securities.................46
   SECTION 806. Application of Money Collected..............................................46
   SECTION 807. Limitation on Suits.........................................................46
   SECTION 808. Unconditional Right of Holders to Receive Principal, Premium and Interest...47
   SECTION 809. Restoration of Rights and Remedies..........................................47
   SECTION 810. Rights and Remedies Cumulative..............................................48
   SECTION 811. Delay or Omission Not Waiver................................................48
   SECTION 812. Control by Holders of Securities............................................48
   SECTION 813. Waiver of Past Defaults.....................................................48
   SECTION 814. Undertaking for Costs.......................................................49
   SECTION 815. Waiver of Usury, Stay or Extension Laws.....................................49

ARTICLE NINE THE TRUSTEE ...................................................................50
   SECTION 901. Certain Duties and Responsibilities.........................................50
   SECTION 902. Notice of Defaults..........................................................51
   SECTION 903. Certain Rights of Trustee...................................................51
   SECTION 904. Not Responsible for Recitals or Issuance of Securities......................52
   SECTION 905. May Hold Securities.........................................................52
   SECTION 906. Money Held in Trust.........................................................53
   SECTION 907. Compensation and Reimbursement..............................................53
   SECTION 908. Disqualification; Conflicting Interests.....................................53
</TABLE>

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<TABLE>
<S>                                                                                        <C>
   SECTION 909. Corporate Trustee Required; Eligibility.....................................54
   SECTION 910. Resignation and Removal; Appointment of Successor...........................54
   SECTION 911. Acceptance of Appointment by Successor......................................56
   SECTION 912. Merger, Conversion, Consolidation or Succession to Business.................57
   SECTION 913. Preferential Collection of Claims Against Company...........................57
   SECTION 914. Appointment of Authenticating Agent.........................................58
   SECTION 915. Co-trustee and Separate Trustees............................................59

ARTICLE TEN HOLDERS' LISTS AND REPORTS BY TRUSTEE, COMPANY AND GUARANTOR....................61
   SECTION 1001. Lists of Holders...........................................................61
   SECTION 1002. Reports by Trustee, Company and Guarantor..................................61

ARTICLE ELEVEN CONSOLIDATION, MERGER, CONVEYANCE, OR OTHER TRANSFER.........................61
   SECTION 1101. Company or Guarantor May Consolidate, Etc., Only on Certain Terms..........61
   SECTION 1102. Successor Person Substituted...............................................62
   SECTION 1103. Limitation.................................................................62

ARTICLE TWELVE SUPPLEMENTAL INDENTURES......................................................63
   SECTION 1201. Supplemental Indentures Without Consent of Holders.........................63
   SECTION 1202. Supplemental Indentures With Consent of Holders............................65
   SECTION 1203. Execution of Supplemental Indentures.......................................66
   SECTION 1204. Effect of Supplemental Indentures..........................................66
   SECTION 1205. Conformity With Trust Indenture Act........................................67
   SECTION 1206. Reference in Securities to Supplemental Indentures.........................67
   SECTION 1207. Modification Without Supplemental Indenture................................67

ARTICLE THIRTEEN MEETINGS OF HOLDERS; ACTION WITHOUT MEETING................................67
   SECTION 1301. Purposes for Which Meetings May Be Called..................................67
   SECTION 1302. Call, Notice and Place of Meetings.........................................68
   SECTION 1303. Persons Entitled to Vote at Meetings.......................................68
   SECTION 1304. Quorum; Action.............................................................69
   SECTION 1305. Attendance at Meetings; Determination of Voting Rights; Conduct and
                          Adjournment of Meetings...........................................69
   SECTION 1306. Counting Votes and Recording Action of Meetings............................70
   SECTION 1307. Action Without Meeting.....................................................71

ARTICLE FOURTEEN GUARANTEE .................................................................71
   SECTION 1401. Guarantee..................................................................71
   SECTION 1402. Guarantee Subordinate to Senior Indebtedness of the Guarantor..............72
   SECTION 1403. Payment Over of Proceeds of Securities.....................................73
   SECTION 1404. Disputes with Holders of Certain Senior Indebtedness of the Guarantor......75
   SECTION 1405. Subrogation................................................................75
   SECTION 1406. Obligation of the Guarantor Unconditional..................................75
   SECTION 1407. Priority of Senior Indebtedness of the Guarantor Upon Maturity.............76
   SECTION 1408. Trustee as Holder of Senior Indebtedness of the Guarantor..................76
</TABLE>

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<TABLE>
<S>                                                                                        <C>
   SECTION 1409. Notice to Trustee to Effectuate Subordination..............................76
   SECTION 1410. Modification, Extension, Etc. of Senior Indebtedness of the Guarantor......77
   SECTION 1411. Trustee Has No Fiduciary Duty to Holders of Senior Indebtedness of the
                          Guarantor.........................................................77
   SECTION 1412. Paying Agents Other Than the Trustee.......................................78
   SECTION 1413. Rights of Holders of Senior Indebtedness of the Guarantor Not Impaired.....78
   SECTION 1414. Effect of Subordination Provisions; Termination............................78
   SECTION 1415. Execution and Delivery of Guarantee........................................78

ARTICLE FIFTEEN SUBORDINATION OF SECURITIES.................................................79
   SECTION 1501. Securities Subordinate to Senior Indebtedness of the Company...............79
   SECTION 1502. Payment Over of Proceeds of Securities.....................................79
   SECTION 1503. Disputes with Holders of Certain Senior Indebtedness of the Company........81
   SECTION 1504. Subrogation................................................................81
   SECTION 1505. Obligation of the Company Unconditional....................................82
   SECTION 1506. Priority of Senior Indebtedness of the Company Upon Maturity...............83
   SECTION 1507. Trustee as Holder of Senior Indebtedness of the Company....................83
   SECTION 1508. Notice to Trustee to Effectuate Subordination..............................83
   SECTION 1509. Modification, Extension, etc. of Senior Indebtedness of the Company........83
   SECTION 1510. Trustee Has No Fiduciary Duty to Holders of Senior Indebtedness of the
                          Company...........................................................84
   SECTION 1511. Paying Agents Other Than the Trustee.......................................84
   SECTION 1512. Rights of Holders of Senior Indebtedness of the Company Not Impaired.......84
   SECTION 1513. Effect of Subordination Provisions; Termination............................84

ARTICLE SIXTEEN IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
                          AND DIRECTORS.....................................................85
   SECTION 1601. Liability Solely Corporate.................................................85

TESTIMONIUM ................................................................................85

SIGNATURES AND SEALS .......................................................................85
</TABLE>

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                                  PPL CAPITAL FUNDING, INC.

                  Reconciliation and tie between Trust Indenture Act of 1939 and
                   this Subordinated Indenture, dated as of May 9, 2001

<TABLE>
<S>                                                                   <C>
Trust Indenture Act Section                                            Indenture Section
Section 310    (a)(1)                                                  909
               (a)(2)                                                  909
               (a)(3)                                                  915
               (a)(4)                                                  Not Applicable
               (b)                                                     908
                                                                       910
Section 311    (a)                                                     913
               (b)                                                     913
               (c)                                                     Not Applicable
Section 312    (a)                                                     1001
               (b)                                                     1001
               (c)                                                     1001
Section 313    (a)                                                     1002
               (b)(1)                                                  Not Applicable
               (b)(2)                                                  1002
               (c)                                                     1002
               (d)                                                     1002
Section 314    (a)                                                     1002
               (a)(4)                                                  605
               (b)                                                     Not Applicable
               (c)(1)                                                  102
               (c)(2)                                                  102
               (c)(3)                                                  Not Applicable
               (d)                                                     Not Applicable
               (e)                                                     102
Section 315    (a)                                                     901(a)
               (b)                                                     902
               (c)                                                     901(b)
               (d)                                                     901(c)
               (d)(1)                                                  901(a)(1), 901(c)(1)
               (d)(2)                                                  901(c)(2)
               (d)(3)                                                  901(c)(3)
               (e)                                                     814
Section 316    (a)                                                     812
                                                                       813
               (a)(1)(A)                                               802
                                                                       812
               (a)(1)(B)                                               813
               (a)(2)                                                  Not Applicable
               (b)                                                     808
Section 317    (a)(1)                                                  803
</TABLE>

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<TABLE>
<S>                                                                   <C>
Trust Indenture Act Section                                            Indenture Section
               (a)(2)                                                  804
               (b)                                                     603
Section 318    (a)                                                     107
</TABLE>

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                SUBORDINATED INDENTURE, dated as of May 9, 2001 (the
"Indenture") among PPL CAPITAL FUNDING, INC., a corporation duly organized and
existing under the laws of the State of Delaware (herein called the "Company"),
having its principal office at Two North Ninth Street, Allentown, Pennsylvania
18101-1179, PPL CORPORATION, a corporation duly organized and existing under the
laws of the Commonwealth of Pennsylvania (herein called the "Guarantor"), having
its principal office at Two North Ninth Street, Allentown, Pennsylvania
18101-1179, and The Chase Manhattan Bank, a New York banking corporation, having
its principal corporate trust office at 450 West 33rd Street, 15th Floor, New
York, New York 10001, as Trustee (herein called the "Trustee").

                             RECITAL OF THE COMPANY

                The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
subordinated debentures, notes or other evidences of indebtedness (herein called
the "Securities"), to be issued in one or more series as contemplated herein,
with Guarantees endorsed thereon, in exchange for the issuance from time to time
by one or more Trusts (as defined below) of undivided beneficial ownership
interests in the assets of such Trusts and all acts necessary to make this
Indenture a valid agreement of the Company, in accordance with its terms, have
been performed.

                            RECITAL OF THE GUARANTOR

                The Guarantor has duly authorized the execution and delivery of
this Indenture to provide for the Guarantee of the Securities provided for
herein; and all acts necessary to make this Indenture a valid agreement of the
Guarantor, in accordance with its terms, have been performed.

                   NOW, THEREFORE, THIS INDENTURE WITNESSETH:

                For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Securities or of series
thereof (except as otherwise contemplated herein), as follows:

                                  ARTICLE ONE

                   DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

SECTION 101.         DEFINITIONS.

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

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

                (b)     all terms used herein which are defined in the Trust
        Indenture Act, either directly or by reference therein, have the
        meanings assigned to them therein;

<PAGE>   9

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

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

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

                Certain terms, used principally in Article Nine, are defined in
that Article.

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

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

                "AUTHENTICATING AGENT" means any Person or Persons authorized by
the Trustee to act on behalf of the Trustee to authenticate the Securities of
one or more series.

                "AUTHORIZED OFFICER" means the Chairman of the Board, the
President, any Vice President, the Treasurer, or any other Person duly
authorized by the Company or the Guarantor, as the case requires, to act in
respect of matters relating to this Indenture.

                "BOARD OF DIRECTORS" means either the board of directors of the
Company or the Guarantor, as the case requires, or any committee of that board
duly authorized to act in respect of matters relating to this Indenture
(including, in the case of the Guarantor, the finance committee of the board of
directors of the Guarantor).

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

                "BUSINESS DAY", when used with respect to a Place of Payment or
any other particular location specified in the Securities or this Indenture,
means any day, other than a Saturday or Sunday, which is not a day on which
banking institutions or trust companies in such Place of Payment or other
location are generally authorized or required by law, regulation or

                                      -2-
<PAGE>   10

executive order to remain closed, except as may be otherwise specified as
contemplated by Section 301.

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

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

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

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

                "CORPORATE TRUST OFFICE" means the office of the Trustee at
which at any particular time its corporate trust business shall be principally
administered, which office at the date of execution of this Indenture is located
at 450 West 33rd Street, 15th Floor, New York, New York 10001.

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

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

                "DISCOUNT SECURITY" means any Security which provides for an
amount less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section 802.

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

                "Eligible Obligations" means:

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

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

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<PAGE>   11

                "EVENT OF DEFAULT" has the meaning specified in Section 801.

                "EXCHANGE ACT" means the Securities Exchange Act of 1934 and the
rules and regulations promulgated thereunder, as amended from time to time.

                "GOVERNMENT OBLIGATIONS" means securities which are (a) (i)
direct obligations of the United States where the payment or payments thereunder
are supported by the full faith and credit of the United States or (ii)
obligations of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States where the timely payment or payments
thereunder are unconditionally guaranteed as a full faith and credit obligation
by the United States or (b) depository receipts issued by a bank (as defined in
Section 3(a)(2) of the Securities Act) as custodian with respect to any such
Government Obligation or a specific payment of interest on or principal of or
other amount with respect to any such Government Obligation held by such
custodian for the account of the holder of a depository receipt, provided that
(except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depository receipt from
any amount received by the custodian in respect of the Government Obligation or
the specific payment of interest on or principal of or other amount with respect
to the Government Obligation evidenced by such depository receipt.

                "GUARANTEE" means any guarantee of the Guarantor endorsed on a
Security authenticated and delivered pursuant to this Indenture and shall
include the guarantee set forth in Section 1401.

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

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

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

                "INDENTURE" means this instrument as originally executed and as
it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this Indenture and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of particular
series of Securities established as contemplated by Section 301.

                "INTEREST", when used with respect to a Discount Security which
by its terms bears interest only after Maturity, means interest payable after
Maturity.

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

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<PAGE>   12

                "MATURITY", when used with respect to any Security, means the
date on which the principal of such Security or an installment of principal
becomes due and payable as provided in such Security or in this Indenture,
whether at the Stated Maturity, by declaration of acceleration, upon call for
redemption or otherwise.

                "NOTICE OF DEFAULT" means a written notice of the kind specified
in Section 801(c).

                "OFFICER'S CERTIFICATE" means a certificate signed by two
Authorized Officers of the Company or the Guarantor, as the case requires, one
of whom must be the principal financial officer and delivered to the Trustee.

                "OPINION OF COUNSEL" means a written opinion of counsel, who may
be counsel for the Company or the Guarantor, and who shall be acceptable to the
Trustee.

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

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

                        (b) Securities deemed to have been paid for all purposes
                of this Indenture in accordance with Section 701 (whether or not
                the Company's indebtedness in respect thereof shall be satisfied
                and discharged for any other purpose); and

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

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

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

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<PAGE>   13

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

                        (y) the principal amount of a Discount Security that
                shall be deemed to be Outstanding for such purposes shall be the
                amount of the principal thereof that would be due and payable as
                of the date of such determination upon a declaration of
                acceleration of the Maturity thereof pursuant to Section 802;
                and

                        (z) the principal amount of any Security which is
                denominated in a currency other than Dollars or in a composite
                currency that shall be deemed to be Outstanding for such
                purposes shall be the amount of Dollars which could have been
                purchased by the principal amount (or, in the case of a Discount
                Security, the Dollar equivalent on the date determined as set
                forth below of the amount determined as provided in (y) above)
                of such currency or composite currency evidenced by such
                Security, in each such case certified to the Trustee in an
                Officer's Certificate, based (i) on the average of the mean of
                the buying and selling spot rates quoted by three banks which
                are members of the New York Clearing House Association selected
                by the Company in effect at 11:00 A.M. (New York time) in The
                City of New York on the fifth Business Day preceding any such
                determination or (ii) if on such fifth Business Day it shall not
                be possible or practicable to obtain such quotations from such
                three banks, on such other quotations or alternative methods of
                determination which shall be as consistent as practicable with
                the method set forth in (i) above;

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

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

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

                "PERSON" means any individual, corporation, partnership, limited
liability company, joint venture, trust or unincorporated organization or any
government or any political subdivision, instrumentality or agency thereof.

                                      -6-
<PAGE>   14

                "PLACE OF PAYMENT", when used with respect to the Securities of
any series, or Tranche thereof, means the place or places, specified as
contemplated by Section 301, at which, subject to Section 602, principal of and
premium, if any, and interest, if any, on the Securities of such series or
Tranche are payable.

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

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

                "PROPERTY TRUSTEE" shall have the meaning set forth in the Trust
Agreement.

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

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

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

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

                "RESPONSIBLE OFFICER", when used with respect to the Trustee,
means any officer of the Trustee with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer of the Trustee to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.

                "SECURITIES" has the meaning stated in the first recital of this
Indenture and more particularly means any securities authenticated and delivered
under this Indenture.

                "SECURITIES ACT" means the Securities Act of 1933, and the rules
and regulations promulgated thereunder, as amended from time to time.

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

                "SENIOR INDEBTEDNESS", when used with respect to the Company or
the Guarantor, means all obligations (other than non-recourse obligations and
the indebtedness issued under this Indenture) of, or guaranteed or assumed by,
the Company or the Guarantor, as the case may be, for borrowed money, including
both senior and subordinated indebtedness for borrowed money (other than the
Securities), or for the payment of money relating to any lease

                                      -7-
<PAGE>   15

which is capitalized on the consolidated balance sheet of the Company or the
Guarantor, as the case may be, and its subsidiaries in accordance with generally
accepted accounting principles as in effect from time to time, or evidenced by
bonds, debentures, notes or other similar instruments, and in each case,
amendments, renewals, extensions, modifications and refundings of any such
indebtedness or obligations, whether existing as of the date of this Indenture
or subsequently incurred by the Company or the Guarantor, as the case may be,
unless, in the case of any particular indebtedness, renewal, extension or
refunding, the instrument creating or evidencing the same or the assumption or
guarantee of the same expressly provides that such indebtedness, renewal,
extension or refunding is not superior in right of payment to or is pari passu
with the Securities or the Guarantees, as the case may be; provided that the
Guarantor's obligations under the Trust Securities Guarantee shall not be deemed
to be Senior Indebtedness of the Guarantor, and provided further that Senior
Indebtedness shall not include (i) any obligation of the Company to any of its
subsidiaries or (ii) trade accounts payable or accrued liabilities arising in
the ordinary course of business or (iii) any obligations to an employee.

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

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

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

                "SUBSIDIARY" means a corporation more than 50% of the
outstanding voting stock of which is owned, directly or indirectly, by the
Company or by one or more other Subsidiaries, or by the Company and one or more
other Subsidiaries. For the purposes of this definition, "voting stock" means
stock which ordinarily has voting power for the election of directors, whether
at all times or only so long as no senior class of stock has such voting power
by reason of any contingency.

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

                "TRUST" means PPL Capital Funding Trust I, a statutory business
trust formed under the laws of the State of Delaware, or any other trust
designated pursuant to Section 301 hereof or any permitted successor under the
Trust Agreement pertaining to such Trust.

                                      -8-
<PAGE>   16

                "TRUST AGREEMENT" means the Amended and Restated Trust
Agreement, dated as of May 9, 2001, relating to PPL Capital Funding Trust I, or
an Amended and Restated Trust Agreement relating to a Trust designated pursuant
to Section 301 hereof, in each case, among PPL Corporation, as Depositor and
Trust Securities Guarantor, the trustees named therein and the several holders
referred to therein, as such agreement or agreements, as the case may be, may be
amended from time to time.

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

                "TRUST INDENTURE ACT" means, as of any time, the Trust Indenture
Act of 1939 as in force at such time.

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

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

SECTION 102.           COMPLIANCE CERTIFICATES AND OPINIONS.

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

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

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

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

                                      -9-
<PAGE>   17

                (c)     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

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

SECTION 103.           FORM OF DOCUMENTS DELIVERED TO TRUSTEE.

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

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

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

                (c)     Whenever, subsequent to the receipt by the Trustee of
any Board Resolution, Officer's Certificate, Opinion of Counsel or other
document or instrument, a clerical, typographical or other inadvertent or
unintentional error or omission shall be discovered therein,

                                      -10-
<PAGE>   18

a new document or instrument may be substituted therefor in corrected form with
the same force and effect as if originally filed in the corrected form and,
irrespective of the date or dates of the actual execution and/or delivery
thereof, such substitute document or instrument shall be deemed to have been
executed and/or delivered as of the date or dates required with respect to the
document or instrument for which it is substituted. Anything in this Indenture
to the contrary notwithstanding, if any such corrective document or instrument
indicates that action has been taken by or at the request of the Company which
could not have been taken had the original document or instrument not contained
such error or omission, the action so taken shall not be invalidated or
otherwise rendered ineffective but shall be and remain in full force and effect,
except to the extent that such action was a result of willful misconduct or bad
faith. Without limiting the generality of the foregoing, any Securities issued
under the authority of such defective document or instrument shall nevertheless
be the valid obligations of the Company entitled to the benefits of this
Indenture equally and ratably with all other Outstanding Securities, except as
aforesaid.

SECTION 104.           ACTS OF HOLDERS.

                (a)     Any request, demand, authorization, direction, notice,
consent, election, waiver or other action provided by this Indenture to be made,
given or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by an agent duly appointed in writing or, alternatively, may be embodied in and
evidenced by the record of Holders voting in favor thereof, either in person or
by proxies duly appointed in writing, at any meeting of Holders duly called and
held in accordance with the provisions of Article Thirteen, or a combination of
such instruments and any such record. Except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
or record or both are delivered to the Trustee and, where it is hereby expressly
required, to the Company and the Guarantor. Such instrument or instruments and
any such record (and the action embodied therein and evidenced thereby) are
herein sometimes referred to as the "Act" of the Holders signing such instrument
or instruments and so voting at any such meeting. Proof of execution of any such
instrument or of a writing appointing any such agent, or of the holding by any
Person of a Security, shall be sufficient for any purpose of this Indenture and
(subject to Section 901) conclusive in favor of the Trustee, the Company and the
Guarantor, if made in the manner provided in this Section. The record of any
meeting of Holders shall be proved in the manner provided in Section 1306.

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

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

                                      -11-
<PAGE>   19

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

                (e)     Until such time as written instruments shall have been
delivered to the Trustee with respect to the requisite percentage of principal
amount of Securities for the action contemplated by such instruments, any such
instrument executed and delivered by or on behalf of a Holder may be revoked
with respect to any or all of such Securities by written notice by such Holder
or any subsequent Holder, proven in the manner in which such instrument was
proven.

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

                (g)     Each of the Company and the Guarantor may, at its
option, by Company Order or Guarantor Order, as appropriate, fix in advance a
record date for the determination of Holders entitled to give any request,
demand, authorization, direction, notice, consent, waiver or other Act solicited
by the Company, but neither the Company nor the Guarantor shall have any
obligation to do so; provided, however, that neither the Company nor the
Guarantor may fix a record date for the giving or making of any notice,
declaration, request or direction referred to in the next sentence. In addition,
the Trustee may, at its option, fix in advance a record date for the
determination of Holders entitled to join in the giving or making of any Notice
of Default, any declaration of acceleration referred to in Section 802, any
request to institute proceedings referred to in Section 807 or any direction
referred to in Section 812. If any such record date is fixed, such request,
demand, authorization, direction, notice, consent, waiver or other Act, or such
notice, declaration, request or direction, may be given before or after such
record date, but only the Holders of record at the close of business on the
record date shall be deemed to be Holders for the purposes of determining (i)
whether Holders of the requisite proportion of the Outstanding Securities have
authorized or agreed or consented to such Act (and for that purpose the
Outstanding Securities shall be computed as of the record date) and/or (ii)
which Holders may revoke any such Act (notwithstanding subsection (e) of this
Section ); and any such Act, given as aforesaid, shall be effective whether or
not the Holders which authorized or agreed or consented to such Act remain
Holders after such record date and whether or not the Securities held by such
Holders remain Outstanding after such record date.

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

                Any request, demand, authorization, direction, notice, consent,
election, waiver or Act of Holders or other document provided or permitted by
this Indenture to be made upon,

                                      -12-
<PAGE>   20

given or furnished to, or filed with, the Trustee by any Holder or by the
Company or the Guarantor, or the Company or the Guarantor by the Trustee or by
any Holder, shall be sufficient for every purpose hereunder (unless otherwise
expressly provided herein) if in writing and delivered personally to an officer
or other responsible employee of the addressee, or transmitted by facsimile
transmission, telex or other direct written electronic means to such telephone
number or other electronic communications address set forth for such party below
or such other address as the parties hereto shall from time to time designate,
or transmitted by registered mail, charges prepaid, to the applicable address
set forth for such party below or to such other address as any party hereto may
from time to time designate:

                      If to the Trustee, to:

                      The Chase Manhattan Bank
                      450 West 33rd Street
                      15th Floor
                      New York, New York 10001

                      Attention:  Institutional Trust Services
                      Telephone:  (212) 946-7557
                      Telecopy:  (212) 946-8177

                      If to the Company, to:

                      PPL Capital Funding, Inc.
                      Two North Ninth Street
                      Allentown, Pennsylvania  18101-1179
                      Attention: Treasurer

                      Telephone:  (610) 774-5987
                      Telecopy:    (610) 774-5106

                      With a copy to:

                      PPL Corporation
                      Two North Ninth Street
                      Allentown, Pennsylvania 18101-1179
                      Attention: Treasurer

                      Telephone:  (610) 774-5987
                      Telecopy:    (610) 774-5106

                      If to the Guarantor, to:

                      PPL Corporation
                      Two North Ninth Street
                      Allentown, Pennsylvania 18101-1179
                      Attention: Treasurer

                                      -13-
<PAGE>   21

                      Telephone: (610) 774-5987
                      Telecopy: (610) 774-5106

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

SECTION 106.           NOTICE TO HOLDERS OF SECURITIES; WAIVER.

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

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

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

SECTION 107.           CONFLICT WITH TRUST INDENTURE ACT.

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

SECTION 108.           EFFECT OF HEADINGS AND TABLE OF CONTENTS.

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

SECTION 109.           SUCCESSORS AND ASSIGNS.

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

                                      -14-
<PAGE>   22

SECTION 110.           SEPARABILITY CLAUSE.

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

SECTION 111.           BENEFITS OF INDENTURE.

                Nothing in this Indenture, the Securities or the Guarantees,
express or implied, shall give to any Person, other than the parties hereto,
their successors hereunder, the Holders and the holders of Senior Indebtedness,
any benefit or any legal or equitable right, remedy or claim under this
Indenture , provided, however, that for so long as any Preferred Securities
remain outstanding, the holders of such Preferred Securities, subject to certain
limitations set forth in this Indenture, may enforce the Company's and the
Guarantor's obligations hereunder, directly against the Company or the
Guarantor, as the case may be, as third party beneficiaries of this Indenture
without proceeding against the Trust issuing such Preferred Securities.

SECTION 112.           GOVERNING LAW.

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

SECTION 113.           LEGAL HOLIDAYS.

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

                                      -15-
<PAGE>   23

                                  ARTICLE TWO

                                 SECURITY FORMS

SECTION 201.           FORMS GENERALLY.

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

                Unless otherwise specified as contemplated by Section 301 or
1201(g), the Securities of each series shall be issuable in registered form
without coupons. The definitive Securities and Guarantees endorsed thereon shall
be produced in such manner as shall be determined by the officers executing such
Securities or Guarantees, as evidenced by their execution thereof.

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

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

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

                                      The Chase Manhattan Bank,
                                      as Trustee

                                      By:
                                             -----------------------------
                                             Authorized Officer

                                      -16-
<PAGE>   24

                                 ARTICLE THREE

                                 THE SECURITIES

SECTION 301.           AMOUNT UNLIMITED; ISSUABLE IN SERIES.

                The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited ; provided,
however, that all Securities shall be issued to a Trust to evidence loans by a
Trust of the proceeds of the issuance of Preferred Securities and Common
Securities of such Trust.

                The Securities may be issued in one or more series. Subject to
the last paragraph of this Section, prior to the authentication and delivery of
Securities of any series there shall be established by specification in a
supplemental indenture or in a Board Resolution of the Company or in an
Officer's Certificate of the Company (which need not, comply with Section 102)
pursuant to a supplemental indenture or a Board Resolution:

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

                (b)     any limit upon the aggregate principal amount of the
        Securities of such series which may be authenticated and delivered under
        this Indenture (except for Securities authenticated and delivered upon
        registration of transfer of, or in exchange for, or in lieu of, other
        Securities of such series pursuant to Section 304, 305, 306, 406 or 1206
        and except for any Securities which, pursuant to Section 303, are deemed
        never to have been authenticated and delivered hereunder);

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

                (d)     the date or dates on which the principal of the
        Securities of such series or any Tranche thereof, is payable or any
        formulary or other method or other means by which such date or dates
        shall be determined, by reference to an index or other fact or event
        ascertainable outside of this Indenture or otherwise (without regard to
        any provisions for redemption, prepayment, acceleration, purchase or
        extension);

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

                                      -17-
<PAGE>   25

        duration of any such extension as contemplated by Section 312; and the
        basis of computation of interest, if other than as provided in Section
        310;

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

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

                (h)     the obligation, if any, of the Company to redeem or
        purchase or repay the Securities of such series, or any Tranche thereof,
        pursuant to any sinking fund or other mandatory redemption provisions or
        at the option of a Holder thereof and the period or periods within which
        or the date or dates on which, the price or prices at which and the
        terms and conditions upon which such Securities shall be redeemed or
        purchased or repaid, in whole or in part, pursuant to such obligation
        and applicable exceptions to the requirements of Section 404 in the case
        of mandatory redemption or redemption or repayment at the option of the
        Holder;

                (i)     the denominations in which Securities of such series, or
        any Tranche thereof, shall be issuable if other than denominations of
        $25 and any integral multiple thereof;

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

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

                                      -18-
<PAGE>   26

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

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

                (n)     if other than the entire principal amount thereof, the
        portion of the principal amount of Securities of such series, or any
        Tranche thereof, which shall be payable upon declaration of acceleration
        of the Maturity thereof pursuant to Section 802;

                (o)     any Events of Default, in addition to those specified in
        Section 801, or any exceptions to those specified in Section 801, with
        respect to the Securities of such series, and any covenants of the
        Company or the Guarantor for the benefit of the Holders of the
        Securities of such series, or any Tranche thereof, in addition to those
        set forth in Article Six, or any exceptions to those set forth in
        Article Six;

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

                (q)     the obligations or instruments, if any, which shall be
        considered to be Eligible Obligations in respect of the Securities of
        such series, or any Tranche thereof, denominated in a currency other
        than Dollars or in a composite currency, and any provisions for
        satisfaction and discharge of Securities of any series, in addition to
        those set forth in Section 701 and 702, or any exceptions to those set
        forth in Section 701 and 702;

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

                (s)     if the Securities of such series, or any Tranche
        thereof, are to be issuable as bearer securities, any and all matters
        incidental thereto which are not specifically addressed in a
        supplemental indenture as contemplated by clause (g) of Section 1201;

                (t)     to the extent not established pursuant to clause (r) of
        this paragraph, any limitations on the rights of the Holders of the
        Securities of such Series, or any Tranche thereof, to transfer or
        exchange such Securities or to obtain the registration of transfer

                                      -19-
<PAGE>   27

        thereof; and if a service charge will be made for the registration of
        transfer or exchange of Securities of such series, or any Tranche
        thereof, the amount or terms thereof;

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

                (v)     any terms of the Guarantees with respect to the
        Securities of such series, or any Tranche thereof, in addition to those
        set forth in Section 1401, or any exceptions to those set forth in
        Section 1401; and

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

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

                With respect to Securities of a series subject to a Periodic
Offering, the indenture supplemental hereto or the Board Resolution which
establishes such series, or the Officer's Certificate pursuant to such
supplemental indenture or Board Resolution, as the case may be, may provide
general terms or parameters for Securities of such series and provide either
that the specific terms of Securities of such series, or any Tranche thereof,
shall be specified in a Company Order or that such terms shall be determined by
the Company or its agents in accordance with procedures specified in a Company
Order as contemplated in clause (b) of Section 303.

                All Securities of any one series shall be substantially
identical, except as to principal amount and date of issue and except as may be
set forth in the terms of such series as contemplated above. The Securities of
each series shall be subordinated in right of payment to Senior Indebtedness of
the Company as provided in Article Fifteen and rank without preference or
priority among themselves and equally with the Company's existing and future
subordinated indebtedness. The Guarantees relating to such Securities shall be
subordinated in right of payment to Senior Indebtedness of the Guarantor as
provided in Article Fourteen.

                Unless otherwise provided with respect to a series of Securities
as contemplated in Section 301(b), the aggregate principal amount of a series of
Securities may be increased and additional Securities of such series may be
issued up to the maximum aggregate principal amount authorized with respect to
such series as increased.

SECTION 302.           DENOMINATIONS.

                Unless otherwise provided as contemplated by Section 301 with
respect to any series of Securities, or any Tranche thereof, the Securities of
each series shall be issuable in denominations of $25 and any integral multiple
thereof.

SECTION 303.           EXECUTION, AUTHENTICATION, DELIVERY AND DATING.

                Unless otherwise provided as contemplated by Section 301 with
respect to any series of Securities or any Tranche thereof, the Securities shall
be executed on behalf of the Company by an Authorized Officer of the Company,
and may have the corporate seal of the

                                      -20-
<PAGE>   28

Company affixed thereto or reproduced thereon attested by its Secretary, one of
its Assistant Secretaries or any other Authorized Officer. The signature of any
or all of these officers on the Securities may be manual or facsimile.

                A Security bearing the manual or facsimile signature of an
individual who was at the time of execution an Authorized Officer of the Company
shall bind the Company, notwithstanding that any such individual has ceased to
be an Authorized Officer prior to the authentication and delivery of the
Security or did not hold such office at the date of such Security.

                Unless otherwise provided as contemplated by Section 301, with
respect to any series of Securities or any Tranche thereof, Guarantees to be
endorsed on any Securities shall be executed and delivered in accordance with
the provisions of Section 1402.

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

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

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

                (c)     A Guarantor Order approving the terms and delivery of
        the Guarantees to be endorsed on such Securities as contemplated by the
        Company Order delivered pursuant to clause (b) above;

                (d)     Securities of such series, each executed on behalf of
        the Company by an Authorized Officer of the Company and having a
        Guarantee endorsed thereon executed on behalf of the Guarantor by an
        Authorized Officer of the Guarantor;

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

                        (i)     (A) the forms of such Securities have been duly
                authorized by the Company, (B) the forms of such Guarantees have
                been duly authorized by the

                                      -21-
<PAGE>   29

                Guarantor, and (C) the forms of the Securities and the
                Guarantees have been established in conformity with the
                provisions of this Indenture;

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

                        (iii)   such Securities and the Guarantees endorsed
                thereon, when authenticated and delivered by the Trustee and
                issued and delivered by the Company and the Guarantor in the
                manner and subject to any conditions specified in such Opinion
                of Counsel, will have been duly issued under this Indenture and
                will constitute valid and legally binding obligations of the
                Company and the Guarantor, respectively, entitled to the
                benefits provided by this Indenture, and enforceable in
                accordance with their terms, subject, as to enforcement, to laws
                relating to or affecting generally the enforcement of creditors'
                rights, including, without limitation, bankruptcy and insolvency
                laws and to general principles of equity (regardless of whether
                such enforceability is considered in a proceeding in equity as
                at law);

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

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

                        (y)     that such Securities, and the Guarantees
                endorsed thereon, when (1) executed by the Company or the
                Guarantor, as the case may be, (2) authenticated and delivered
                by the Trustee in accordance with this Indenture, (3) issued and
                delivered by the Company and the Guarantor and (4) paid for, all
                as contemplated by and in accordance with the aforesaid Company
                Order or Orders and, if applicable, a Guarantor Order or Orders
                or specified procedures, as the case may be, will have been duly
                issued under this Indenture and will constitute valid and
                legally binding obligations of the Company and the Guarantor,
                respectively, entitled to the benefits provided by the
                Indenture, and enforceable in accordance with their terms,
                subject, as to enforcement, to laws relating to or affecting
                generally the enforcement of creditors' rights, including,
                without

                                      -22-
<PAGE>   30

                limitation, bankruptcy and insolvency laws and to general
                principles of equity (regardless of whether such enforceability
                is considered in a proceeding in equity or at law).

                With respect to Securities of a series subject to a Periodic
Offering, the Trustee may conclusively rely, as to the authorization by the
Company and the Guarantor of any of such Securities and Guarantees, the forms
and terms thereof and the legality, validity, binding effect and enforceability
thereof, upon the Opinion of Counsel and other documents delivered pursuant to
Sections 201 and 301 and this Section, as applicable, at or prior to the time of
the first authentication of Securities of such series, with the Guarantees
endorsed thereon, unless and until such opinion or other documents have been
superseded or revoked or expire by their terms. In connection with the
authentication and delivery of Securities of a series, with Guarantees endorsed
thereon, pursuant to a Periodic Offering, the Trustee shall be entitled to
assume that the Company's instructions to authenticate and deliver such
Securities, and the Guarantor's approval of the delivery of the Guarantees
thereon, do not violate any applicable law or any applicable rule, regulation or
order of any governmental agency or commission having jurisdiction over the
Company or the Guarantor.

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

                Except as otherwise specified as contemplated by Section 301
with respect to any series of securities, or any Tranche thereof, each Security,
and any Guarantee endorsed thereon, shall each be dated the date of its
authentication.

                Except as otherwise specified as contemplated by Section 301
with respect to any series of Securities, or any Tranche thereof, no Security or
Guarantee endorsed thereon shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose unless there appears on such Security
a certificate of authentication substantially in the form provided for herein
executed by the Trustee or its agent by manual signature of an authorized
officer thereof, and such certificate upon any Security shall be conclusive
evidence, and the only evidence, that such Security or Guarantee endorsed
thereon has been duly authenticated and delivered hereunder and is entitled to
the benefits of this Indenture. Notwithstanding the foregoing, if any Security
shall have been authenticated and delivered hereunder to the Company, or any
Person acting on its behalf, but shall never have been issued and sold by the
Company, and the Company shall deliver such Security to the Trustee for
cancellation as provided in Section 309 together with a written statement (which
need not comply with Section 102 and need not be accompanied by an Opinion of
Counsel) stating that such Security has never been issued and sold by the
Company, for all purposes of this Indenture such Security (including any
Guarantee endorsed thereon) shall be deemed never to have been authenticated and
delivered hereunder and shall never be entitled to the benefits hereof.

                                      -23-
<PAGE>   31

SECTION 304.           TEMPORARY SECURITIES.

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

                If temporary Securities of any series or Tranche are issued, the
Company shall cause definitive Securities of such series or Tranche to be
prepared without unreasonable delay. After the preparation of definitive
Securities of such series or Tranche, the temporary Securities of such series or
Tranche shall be exchangeable for definitive Securities of such series or
Tranche, with the definitive Guarantees of the Guarantor endorsed thereon, upon
surrender of the temporary Securities of such series or Tranche at the office or
agency of the Company maintained pursuant to Section 602 in a Place of Payment
for such series or Tranche, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Securities of any series or Tranche,
the Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor definitive Securities of the same series or Tranche, of
authorized denominations and of like tenor and aggregate principal amount, with
the definitive Guarantees of the Guarantor endorsed thereon.

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

SECTION 305.           REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE.

                The Company shall cause to be kept in one of the offices or
agencies designated pursuant to Section 602, with respect to the Securities of
each series or any Tranche thereof, a register (the "Security Register") in
which, subject to such reasonable regulations as it may prescribe, the Company
shall provide for the registration of Securities of such series or Tranche and
the registration of transfer thereof. The Company shall designate one Person to
maintain the Security Register for the Securities of each series, and such
Person is referred to herein, with respect to such series, as the "Security
Registrar." Anything herein to the contrary notwithstanding, the Company may
designate one or more of its offices or an office of any Affiliate (including
the Guarantor) as an office in which a register with respect to the Securities
of one or more series, or any Tranche or Tranches thereof, shall be maintained,
and the Company may designate itself or any Affiliate (including the Guarantor)
as the Security Registrar with respect to one or more of such series. The
Security Register shall be open for inspection by the Trustee and the Company at
all reasonable times.

                Except as otherwise specified as contemplated by Section 301
with respect to the Securities of any series, or any Tranche thereof, upon
surrender for registration of transfer of any

                                      -24-
<PAGE>   32

Security of such series or Tranche at the office or agency of the Company
maintained pursuant to Section 602 in a Place of Payment for such series or
Tranche, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of the same series and Tranche, of authorized denominations and
of like tenor and aggregate principal amount, with the Guarantees of the
Guarantor endorsed thereon.

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

                All Securities and Guarantees delivered upon any registration of
transfer or exchange of Securities and the Guarantees endorsed thereon shall be
valid obligations of the Company and the Guarantor, respectively, evidencing the
same obligation, and entitled to the same benefits under this Indenture, as the
Securities and Guarantees surrendered upon such registration of transfer or
exchange.

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

                Unless otherwise specified as contemplated by Section 301, with
respect to Securities of any series, or any Tranche thereof, no service charge
shall be made for any registration of transfer or exchange of Securities, but
the Company may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Securities, other than exchanges pursuant to Section
304, 406 or 1206 not involving any transfer.

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

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

                If any mutilated Security is surrendered to the Trustee, the
Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same

                                      -25-
<PAGE>   33

series and Tranche, and of like tenor and principal amount, having a Guarantee
of the Guarantor endorsed thereon and bearing a number not contemporaneously
outstanding.

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

                Notwithstanding the foregoing, in case any such mutilated,
destroyed, lost or stolen Security has become or is about to become due and
payable, the Company or the Guarantor in its discretion may, instead of issuing
a new Security, pay such Security.

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

                Every new Security of any series issued pursuant to this Section
in lieu of any destroyed, lost or stolen Security and any Guarantee endorsed
thereon shall constitute an original additional contractual obligation of the
Company and the Guarantor, respectively, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone other than the Holder
of such new security, and any such new Security shall be entitled to all the
benefits of this Indenture equally and proportionately with any and all other
Securities of such series duly issued hereunder, and the Guarantees endorsed on
such Securities.

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

SECTION 307.           PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.

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

                Subject to Section 312, any interest on any Security of any
series which is payable, but is not punctually paid or duly provided for, on any
Interest Payment Date (herein called "Defaulted Interest") shall forthwith cease
to be payable to the Holder on the related Regular Record Date by virtue of
having been such Holder, and such Defaulted Interest may be paid by the Company
or the Guarantor, at its election in each case, as provided in clause (a) or (b)
below:

                                      -26-
<PAGE>   34

                (a)     The Company or the Guarantor may elect to make payment
        of any Defaulted Interest to the Persons in whose names the Securities
        of such series (or their respective Predecessor Securities) are
        registered at the close of business on a date (a "Special Record Date")
        for the payment of such Defaulted Interest, which shall be fixed in the
        following manner. The Company or the Guarantor shall notify the Trustee
        in writing of the amount of Defaulted Interest proposed to be paid on
        each Security of such series and the date of the proposed payment, and
        at the same time the Company or the Guarantor, as the case may be, shall
        deposit with the Trustee an amount of money equal to the aggregate
        amount proposed to be paid in respect of such Defaulted Interest or
        shall make arrangements satisfactory to the Trustee for such deposit
        prior to the date of the proposed payment, such money when deposited to
        be held in trust for the benefit of the Persons entitled to such
        Defaulted Interest as in this clause provided. Thereupon the Trustee
        shall fix a Special Record Date for the payment of such Defaulted
        Interest which shall be not more than 15 days and not less than 10 days
        prior to the date of the proposed payment and not less than 10 days
        after the receipt by the Trustee of the notice of the proposed payment.
        The Trustee shall promptly notify the Company and the Guarantor of such
        Special Record Date and, in the name and at the expense of the Company
        or the Guarantor, shall promptly cause notice of the proposed payment of
        such Defaulted Interest and the Special Record Date therefor to be
        mailed, first-class postage prepaid, to each Holder of Securities of
        such series at the address of such Holder as it appears in the Security
        Register, not less than 10 days prior to such Special Record Date.
        Notice of the proposed payment of such Defaulted Interest and the
        Special Record Date therefor having been so mailed, such Defaulted
        Interest shall be paid to the Persons in whose names the Securities of
        such series (or their respective Predecessor Securities) are registered
        at the close of business on such Special Record Date.

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

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

SECTION 308.           PERSONS DEEMED OWNERS.

                Prior to due presentment of a Security for registration of
transfer, the Company, the Guarantor, the Trustee and any agent of the Company,
the Guarantor or the Trustee may treat the Person in whose name such Security is
registered as the absolute owner of such Security for the purpose of receiving
payment of principal of and premium, if any, and (subject to Sections 305 and
307) interest, if any, on such Security and for all other purposes whatsoever,
whether or not such Security be overdue, and none of the Company, the Guarantor,
the Trustee or any agent of the Company, the Guarantor or the Trustee shall be
affected by notice to the contrary.

                                      -27-
<PAGE>   35

SECTION 309.           CANCELLATION.

                All Securities surrendered for payment, redemption, registration
of transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and, if not theretofore canceled, shall be promptly canceled by the Trustee. The
Company or the Guarantor may at any time deliver to the Trustee for cancellation
any Securities previously authenticated and delivered hereunder which the
Company or the Guarantor may have acquired in any manner whatsoever or which the
Company shall not have issued and sold, and all Securities so delivered shall be
promptly canceled by the Trustee. No Securities shall be authenticated in lieu
of or in exchange for any Securities canceled as provided in this Section,
except as expressly permitted by this Indenture. All canceled Securities held by
the Trustee shall be disposed of in accordance with the Trustee's customary
procedures, unless, by a Company Order, the Company shall request a certificate
of disposition or direct that canceled Securities be returned to it.

SECTION 310.           COMPUTATION OF INTEREST.

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

SECTION 311.           PAYMENT TO BE IN PROPER CURRENCY.

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

SECTION 312.           EXTENSION OF INTEREST PAYMENT.

                The Company shall have the right at any time, so long as no
Event of Default hereunder has occurred and is continuing with respect to the
Securities of any series, to extend

                                      -28-
<PAGE>   36

interest payment periods from time to time on all Securities of such series, if
so specified as contemplated by Section 301 with respect to such Securities and
upon such terms as may be specified as contemplated by Section 301 with respect
to such Securities.

                                  ARTICLE FOUR

                            REDEMPTION OF SECURITIES

SECTION 401.           APPLICABILITY OF ARTICLE.

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

SECTION 402.           ELECTION TO REDEEM; NOTICE TO TRUSTEE.

                The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution or an Officer's Certificate. The Company shall,
at least 45 days prior to the Redemption Date fixed by the Company (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee and in
the case of Securities of a series held by a Trust, the Property Trustee under
the related Trust Agreement in writing of such Redemption Date and of the
principal amount of such Securities to be redeemed. In the case of any
redemption of Securities (a) prior to the expiration of any restriction on such
redemption provided in the terms of such Securities or elsewhere in this
Indenture or (b) pursuant to an election of the Company which is subject to a
condition specified in the terms of such Securities, the Company and the
Guarantor shall each furnish the Trustee with an Officer's Certificate
evidencing compliance with such restriction or condition.

SECTION 403.           SELECTION OF SECURITIES TO BE REDEEMED.

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

                                      -29-
<PAGE>   37

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

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

SECTION 404.           NOTICE OF REDEMPTION.

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

                All notices of redemption shall state:

                (a)     the Redemption Date,

                (b)     the Redemption Price,

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

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

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

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

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

                Unless otherwise specified with respect to any Securities in
accordance with Section 301, with respect to any notice of redemption of
Securities at the election of the Company, unless, upon the giving of such
notice, such Securities shall be deemed to have been paid in accordance with
Section 701, such notice may state that such redemption shall be conditional
upon the receipt by the Paying Agent or Agents for such Securities, on or prior
to the date fixed for such redemption, of money sufficient to pay the principal
of and premium, if any, and interest, if any, on such Securities and that if
such money shall not have been so received such notice shall be of no force or
effect and the Company shall not be required to redeem such Securities. In the
event that such notice of redemption contains such a condition and such money

                                      -30-
<PAGE>   38

is not so received, the redemption shall not be made and within a reasonable
time thereafter notice shall be given, in the manner in which the notice of
redemption was given, that such money was not so received and such redemption
was not required to be made.

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

SECTION 405.           SECURITIES PAYABLE ON REDEMPTION DATE.

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

SECTION 406.           SECURITIES REDEEMED IN PART.

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

                                      -31-
<PAGE>   39

                                  ARTICLE FIVE

                                  SINKING FUNDS

SECTION 501.           APPLICABILITY OF ARTICLE.

                The provisions of this Article shall be applicable to any
sinking fund for the retirement of the Securities of any series, or any Tranche
thereof, except as otherwise specified as contemplated by Section 301 for
Securities of such series or Tranche.

                The minimum amount of any sinking fund payment provided for by
the terms of Securities of any series, or any Tranche thereof, is herein
referred to as a "mandatory sinking fund payment", and any payment in excess of
such minimum amount provided for by the terms of Securities of any series, or
any Tranche thereof, is herein referred to as an "optional sinking fund
payment". If provided for by the terms of Securities of any series, or any
Tranche thereof, the cash amount of any sinking fund payment may be subject to
reduction as provided in Section 502. Each sinking fund payment shall be applied
to the redemption of Securities of the series or Tranche in respect of which it
was made as provided for by the terms of such Securities.

SECTION 502.           SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.

                The Company (a) may deliver to the Trustee Outstanding
Securities (other than any previously called for redemption) of a series or
Tranche in respect of which a mandatory sinking fund payment is to be made and
(b) may apply as a credit Securities of such series or Tranche which have been
redeemed either at the election of the Company pursuant to the terms of such
Securities or through the application of permitted optional sinking fund
payments pursuant to the terms of such Securities, in each case in satisfaction
of all or any part of such mandatory sinking fund payment; provided, however,
that no Securities shall be applied in satisfaction of a mandatory sinking fund
payment if such Securities shall have been previously so applied. Securities so
applied shall be received and credited for such purpose by the Trustee at the
Redemption Price specified in such Securities for redemption through operation
of the sinking fund and the amount of such mandatory sinking fund payment shall
be reduced accordingly.

SECTION 503.           REDEMPTION OF SECURITIES FOR SINKING FUND.

                Not less than 45 days prior to each sinking fund payment date
for the Securities of any series, or any Tranche thereof, the Company shall
deliver to the Trustee an Officer's Certificate specifying:

                (a)     the amount of the next succeeding mandatory sinking fund
        payment for such series or Tranche;

                (b)     the amount, if any, of the optional sinking fund payment
        to be made together with such mandatory sinking fund payment;

                (c)     the aggregate sinking fund payment;

                                      -32-
<PAGE>   40

                (d)     the portion, if any, of such aggregate sinking fund
        payment which is to be satisfied by the payment of cash;

                (e)     the portion, if any, of such aggregate sinking fund
        payment which is to be satisfied by delivering and crediting Securities
        of such series or Tranche pursuant to Section 502 and stating the basis
        for such credit and that such Securities have not previously been so
        credited, and the Company shall also deliver to the Trustee any
        Securities to be so delivered. If the Company shall not deliver such
        Officer's Certificate, the next succeeding sinking fund payment for such
        series or Tranche shall be made entirely in cash in the amount of the
        mandatory sinking fund payment. Not less than 30 days before each such
        sinking fund payment date the Trustee shall select the Securities to be
        redeemed upon such sinking fund payment date in the manner specified in
        Section 403 and cause notice of the redemption thereof to be given in
        the name of and at the expense of the Company in the manner provided in
        Section 404. Such notice having been duly given, the redemption of such
        Securities shall be made upon the terms and in the manner stated in
        Sections 405 and 406.

                                  ARTICLE SIX

                                    COVENANTS

SECTION 601.           PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.

                At or prior to 10 a.m., New York City time, on each date when
payment is due, the Company shall pay the principal of and premium, if any, and
interest, if any, on the Securities of each series in accordance with the terms
of such Securities and this Indenture.

SECTION 602.           MAINTENANCE OF OFFICE OR AGENCY.

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

                The Company or the Guarantor may also from time to time
designate one or more other offices or agencies with respect to the Securities
of one or more series, or any Tranche thereof, for any or all of the foregoing
purposes and may from time to time rescind such

                                      -33-
<PAGE>   41

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

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

SECTION 603.           MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST.

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

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

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

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

                (b)     give the Trustee notice of any default by the Company
        (or any other obligor upon the Securities of such series) in the making
        of any payment of principal of and premium, if any, or interest, if any,
        on the Securities of such series or Tranche; and

                                      -34-
<PAGE>   42

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

                Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of and
premium, if any, or interest, if any, on any Security and remaining unclaimed
for two years after such principal and premium, if any, or interest has become
due and payable shall be paid to the Company on Company Request, or, if then
held by the Company, shall be discharged from such trust; and the Holder of such
Security shall thereafter, as an unsecured general creditor, look only to the
Company and the Guarantor for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such payment to
the Company, may at the expense of the Company, either (a) cause to be mailed,
on one occasion only, notice to such Holder that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such mailing, any unclaimed balance of such money then
remaining will be paid to the Company or (b) cause to be published once, in a
newspaper published in the English language, customarily published on each
Business Day and of general circulation in the Borough of Manhattan, The City of
New York, notice that such money remains unclaimed and that after a date
specified therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining will be paid to
the Company.

SECTION 604.           CORPORATE EXISTENCE.

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

SECTION 605.           ANNUAL OFFICER'S CERTIFICATE

                Not later than April 30 in each year, commencing April 30, 2002,
each of the Company and the Guarantor shall deliver to the Trustee an Officer's
Certificate which need not comply with Section 102, executed by its principal
executive officer, principal financial officer or principal accounting officer,
as to such officer's knowledge of such obligor's compliance with all conditions
and covenants under this Indenture, such compliance to be determined without
regard to any period of grace or requirement of notice under this Indenture.

                                      -35-
<PAGE>   43

SECTION 606.           WAIVER OF CERTAIN COVENANTS.

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

                (a)     Section 607, 608 or any covenant or restriction
        specified with respect to the Securities of any series, or any Tranche
        thereof, as contemplated by Section 301 or by Section 1201(b), if before
        the time for such compliance the Holders of a majority in aggregate
        principal amount of the Outstanding Securities of all series and
        Tranches with respect to which compliance with such covenant or
        restriction is to be omitted, considered as one class, shall, by Act of
        such Holders, either waive such compliance in such instance or generally
        waive compliance with such term, provision or condition; and

                (b)     Section 604 or 1101(a) or (b), if before the time for
        such compliance the Holders of a majority in principal amount of
        Securities Outstanding under this Indenture shall, by Act of such
        Holders, either waive such compliance in such instance or generally
        waive compliance with such term, provision or condition;

but, in either case, no such waiver shall extend to or affect such term,
provision or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such term, provision or condition shall remain in
full force and effect; provided, however, so long as a Trust holds Securities of
any series, such Trust may not waive compliance or waive any default in
compliance by the Company with any covenant or other term contained in this
Indenture or the Securities of such series without the approval of the holders
of at least a majority in aggregate liquidation preference of the outstanding
Preferred Securities issued by such Trust affected, obtained as provided in the
Trust Agreement pertaining to such Trust.

SECTION 607.           RESTRICTION ON PAYMENT OF DIVIDENDS.

                So long as any Preferred Securities of any series remain
outstanding, if at such time (a) the Guarantor shall be in default with respect
to its payment obligations under the Trust Securities Guarantee relating to such
Preferred Securities, (b) there shall have occurred and be continuing an Event
of Default (whether before or after expiration of any period of grace) resulting
from a payment default hereunder or (c) the Company shall have elected to extend
any interest payment period as provided in Section 312, and any such period, or
any extension thereof, shall be continuing, then the Guarantor shall not (i)
declare or pay any dividends or distributions on its capital stock, other than
dividends paid in shares of capital stock of the Guarantor or dividends declared
in connection with the implementation of a stockholders' rights plan or the
redemption or repurchase of any such rights pursuant thereto, or (ii) redeem,
purchase, acquire or make a liquidation payment with respect to any of the
Guarantor's capital stock, or (iii) pay any principal, interest or premium on,
or repay, repurchase or redeem any debt securities that are equal or junior in
right of payment to the Guarantees, or (iv) make any payments with respect to
any guarantee of debt securities by the Guarantor if such guarantee is equal or
junior in right of payment to the Guarantees (other than payments under the
Guarantee or the Trust Securities Guarantee relating to such Preferred
Securities).

                                      -36-
<PAGE>   44

SECTION 608.           MAINTENANCE OF TRUST EXISTENCE.

                So long as Preferred Securities of any series remain
outstanding, the Company shall (i) maintain direct or indirect ownership of all
interests in the Trust which issued such Preferred Securities, other than such
Preferred Securities, (ii) not voluntarily (to the extent permitted by law)
dissolve, liquidate or wind up such Trust, except in connection with a
distribution of the Securities to the holders of the Preferred Securities in
liquidation of such Trust, (iii) remain the sole Depositor under the Trust
Agreement (the "Depositor") of such Trust and timely perform in all material
respects all of its duties as Depositor of such Trust, and (iv) use reasonable
efforts to cause such Trust to remain a business trust and otherwise continue to
be treated as a grantor trust for Federal income tax purposes, provided that any
permitted successor to the Guarantor or the Company under this Indenture may
succeed to the Guarantor's or the Company's duties as Depositor of such Trust;
and provided further that the Guarantor or the Company may permit such Trust to
consolidate or merge with or into another business trust or other permitted
successor under the Trust Agreement pertaining to such Trust so long as the
Guarantor agrees to comply with this Section 608 with respect to such successor
business trust or other permitted successor.

SECTION 609.           RIGHTS OF HOLDERS OF PREFERRED SECURITIES.

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

SECTION 610.           PAYMENT OF TRUST COSTS AND EXPENSES.

                Since each Trust is being formed solely to facilitate an
investment in the Securities, the Company, in its capacity as the issuer of the
Securities, hereby covenants to pay all debts and obligations (other than with
respect to the Preferred Securities and Common Securities) and all costs and
expenses of each Trust (including, but not limited to, all costs and expenses
relating to the organization of the Trust, the fees and expenses of the Trustees
and their counsels and all costs and expenses relating to the operation of the
Trust) and to pay any and all taxes, duties, assessments or governmental charges
of whatever nature (other than withholding taxes) imposed on the Trust by the
United States, or any other taxing authority, so that the net amounts received
and retained by the Trust and the Property Trustee after paying any such debts,
obligations, costs, expenses, taxes, duties, assessments or other governmental
charges will be equal to the amounts the Trust and the Property Trustee would
have received had no such debts, obligations, costs, expenses, taxes, duties,
assessments or other governmental charges been incurred by or imposed on the
Trust. The obligations of the Company to pay all debts, obligations, costs,
expenses, taxes, duties, assessments or other governmental charges of each Trust
(other than with respect to the Preferred Securities and Common Securities)
shall constitute additional indebtedness hereunder and shall survive the
resignation or removal of the Trustees and the satisfaction and discharge of
this Indenture.

                                      -37-
<PAGE>   45

                                 ARTICLE SEVEN

                           SATISFACTION AND DISCHARGE

SECTION 701.           SATISFACTION AND DISCHARGE OF SECURITIES.

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

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

                (b)     in the case of a deposit made prior to the Maturity of
        such Securities or portions thereof, Eligible Obligations, which shall
        not contain provisions permitting the redemption or other prepayment
        thereof at the option of the issuer thereof, the principal of and the
        interest on which when due, without any regard to reinvestment thereof,
        will provide moneys which, together with the money, if any, deposited
        with or held by the Trustee or such Paying Agent, shall be sufficient,
        or

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

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

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

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

                        (z)     if such deposit shall have been made prior to
                the Maturity of such Securities, an Officer's Certificate
                stating the Company's intention that, upon delivery of such
                Officer's Certificate, its indebtedness in respect of such

                                      -38-
<PAGE>   46

                Securities or portions thereof will have been satisfied and
                discharged as contemplated in this Section.

                Upon the deposit of money or Eligible Obligations, or both, in
accordance with this Section, together with the documents required by clauses
(x), (y) and (z) above, the Trustee shall, upon Company Request, acknowledge in
writing that such Securities or portions thereof are deemed to have been paid
for all purposes of this Indenture and that the entire indebtedness of the
Company in respect thereof has been satisfied and discharged as contemplated in
this Section. In the event that all of the conditions set forth in the preceding
paragraph shall have been satisfied in respect of any Securities or portions
thereof except that, for any reason, the Officer's Certificate specified in
clause (z) (if otherwise required) shall not have been delivered, such
Securities or portions thereof shall nevertheless be deemed to have been paid
for all purposes of this Indenture, and the Holders of such Securities or
portions thereof shall nevertheless be no longer entitled to the benefits
provided by this Indenture or of any of the covenants of the Company under
Article Six (except the covenants contained in Sections 602 and 603) or any
other covenants made in respect of such Securities or portions thereof as
contemplated by Section 301 or Section 1201(b), but the indebtedness of the
Company in respect of such Securities or portions thereof shall not be deemed to
have been satisfied and discharged prior to Maturity for any other purpose; and,
upon Company Request, the Trustee shall acknowledge in writing that such
Securities or portions thereof are deemed to have been paid for all purposes of
this Indenture.

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

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

                Notwithstanding that any Securities shall be deemed to have been
paid for purposes of this Indenture, as aforesaid, the obligations of the
Company, the Guarantor and the Trustee in respect of such Securities under
Sections 304, 305, 306, 404, 602, 603, 907 and 914 and this Article shall
survive.

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

                                      -39-
<PAGE>   47

                Anything herein to the contrary notwithstanding, (a) if, at any
time after a Security would be deemed to have been paid for purposes of this
Indenture, and, if such is the case, the Company's indebtedness in respect
thereof would be deemed to have been satisfied and discharged, pursuant to this
Section (without regard to the provisions of this paragraph), the Trustee or any
Paying Agent, as the case may be, (i) shall be required to return the money or
Eligible Obligations, or combination thereof, deposited with it as aforesaid to
the Company or its representative under any applicable Federal or State
bankruptcy, insolvency or other similar law, or (ii) are unable to apply any
money in accordance with this Article with respect to any Securities by reason
of any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, such Security shall
thereupon be deemed retroactively not to have been paid and any satisfaction and
discharge of the Company's indebtedness in respect thereof shall retroactively
be deemed not to have been effected, and such Security shall be deemed to remain
Outstanding and (b) any satisfaction and discharge of the Company's indebtedness
in respect of any Security shall be subject to the provisions of the last
paragraph of Section 603.

SECTION 702.           SATISFACTION AND DISCHARGE OF INDENTURE.

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

                (a)     no Securities remain Outstanding hereunder; and

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

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

                Notwithstanding the satisfaction and discharge of this Indenture
as aforesaid, the obligations of the Company, the Guarantor and the Trustee
under Sections 304, 305, 306, 404, 602, 603, 907 and 914 and this Article shall
survive.

                Upon satisfaction and discharge of this Indenture as provided in
this Section, the Trustee shall turn over to the Company any and all money,
securities and other property then held by the Trustee for the benefit of the
Holders of the Securities (other than money and Eligible Obligations held by the
Trustee pursuant to Section 703) and shall execute and deliver to the Company
and the Guarantor such instruments as, in the judgment of the Company and the
Guarantor, shall be necessary, desirable or appropriate to effect or evidence
the satisfaction and discharge of this Indenture.

                                      -40-
<PAGE>   48

SECTION 703.           APPLICATION OF TRUST MONEY.

                Neither the Eligible Obligations nor the money deposited
pursuant to Section 701, nor the principal or interest payments on any such
Eligible Obligations, shall be withdrawn or used for any purpose other than, and
shall be held in trust for, the payment of the principal of and premium, if any,
and interest, if any, on the Securities or portions of principal amount thereof
in respect of which such deposit was made, all subject, however, to the
provisions of Section 603; provided, however, that any cash received from such
principal or interest payments on such Eligible Obligations, if not then needed
for such purpose, shall, to the extent practicable and upon Company Request and
delivery to the Trustee of the documents referred to in clause (y) in the first
paragraph of Section 701, be invested in Eligible Obligations of the type
described in clause (b) in the first paragraph of Section 701 maturing at such
times and in such amounts as shall be sufficient, together with any other moneys
and the proceeds of any other Eligible Obligations then held by the Trustee, to
pay when due the principal of and premium, if any, and interest, if any, due and
to become due on such Securities or portions thereof on and prior to the
Maturity thereof, and interest earned from such reinvestment shall be paid over
to the Company as received, free and clear of any trust, lien or pledge under
this Indenture (except the lien provided by Section 907); and provided, further,
that any moneys held in accordance with this Section on the Maturity of all such
Securities in excess of the amount required to pay the principal of and premium,
if any, and interest, if any, then due on such Securities shall be paid over to
the Company free and clear of any trust, lien or pledge under this Indenture
(except the lien provided by Section 907); and provided, further, that if an
Event of Default shall have occurred and be continuing, moneys to be paid over
to the Company pursuant to this Section shall be held until such Event of
Default shall have been waived or cured.

SECTION 704.   REINSTATEMENT.

                If the Trustee is unable to apply any money or Eligible
Obligations in accordance with Section 701 or 702, as the case may be, by reason
of any legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's and the Guarantor's obligations under this Indenture
and the Securities shall be revived and reinstated as though no deposit had
occurred pursuant to Section 701 or 702, as the case may be, until such time as
the Trustee is permitted to apply all such money or Eligible Obligations in
accordance with Section 701 or 702, as the case may be; provided that, if the
Company has made payment of principal of, or interest on any Securities because
of the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Securities to receive such payment from the money
or U.S. Eligible Obligations held by the Trustee.

                                 ARTICLE EIGHT

                           EVENTS OF DEFAULT; REMEDIES

SECTION 801.           EVENTS OF DEFAULT.

                "Event of Default", wherever used herein with respect to
Securities of any series, means any one of the following events:

                                      -41-
<PAGE>   49

                (a)     default in the payment of any interest on any Security
        of such series when it becomes due and payable (whether or not payment
        is prohibited by the subordination provisions of Article Fifteen or the
        subordination provisions of Article Fourteen hereof) and continuance of
        such default for a period of 30 days; provided, however, that a valid
        extension of the interest payment period by the Company as contemplated
        in Section 312 of this Indenture shall not constitute a default in the
        payment of interest for this purpose; or

                (b)     default in the payment of the principal of or premium,
        if any, on any Security of such series when it becomes due and payable
        (whether or not payment is prohibited by the subordination provisions of
        Article Fifteen or the subordination provisions of Article Fourteen
        hereof); or

                (c)     default in the performance of, or breach of, any
        covenant or warranty of the Company or the Guarantor in this Indenture
        (other than a covenant or warranty a default in the performance of which
        or breach of which is elsewhere in this Section specifically dealt with
        or which has expressly been included in this Indenture solely for the
        benefit of one or more series of Securities other than such series) and
        continuance of such default or breach for a period of 90 days after
        there has been given, by registered or certified mail, to the Company
        and the Guarantor by the Trustee, or to the Company, the Guarantor and
        the Trustee by the Holders of at least 25% in principal amount of the
        Outstanding Securities of such series, a written notice specifying such
        default or breach and requiring it to be remedied and stating that such
        notice is a "Notice of Default" hereunder, unless the Trustee, or the
        Trustee and the Holders of a principal amount of Securities of such
        series not less than the principal amount of Securities the Holders of
        which gave such notice, as the case may be, shall agree in writing to an
        extension of such period prior to its expiration; provided, however,
        that the Trustee, or the Trustee and the Holders of such principal
        amount of Securities of such series, as the case may be, shall be deemed
        to have agreed to an extension of such period if corrective action is
        initiated by the Company or the Guarantor within such period and is
        being diligently pursued; or

                (d)     except as provided by the terms hereof, the Securities
        of such series and the Guarantees endorsed thereon, the cessation of
        effectiveness of the Guarantee endorsed on a Security of such series or
        the finding by any judicial proceeding that the Guarantee endorsed on a
        Security of such series is unenforceable or invalid or the denial or
        disaffirmation by the Guarantor of its obligations under the Guarantee
        endorsed on a Security of such series; or

                (e)     the entry by a court having jurisdiction in the premises
        of (1) a decree or order for relief in respect of the Company or the
        Guarantor in an involuntary case or proceeding under any applicable
        Federal or State bankruptcy, insolvency, reorganization or other similar
        law or (2) a decree or order adjudging the Company or the Guarantor a
        bankrupt or insolvent, or approving as properly filed a petition by one
        or more Persons other than the Company or the Guarantor seeking
        reorganization, arrangement, adjustment or composition of or in respect
        of the Company or the Guarantor under any applicable Federal or State
        law, or appointing a custodian, receiver, liquidator, assignee, trustee,
        sequestrator or other similar official for the Company or the Guarantor
        or for any

                                      -42-
<PAGE>   50

        substantial part of its property, or ordering the winding up or
        liquidation of its affairs, and any such decree or order for relief or
        any such other decree or order shall have remained unstayed and in
        effect for a period of 90 consecutive days; or

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

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

SECTION 802.           ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.

                If an Event of Default shall have occurred and be continuing
with respect to Securities of any series at the time Outstanding, then in every
such case the Trustee or the Holders of not less than 25% in principal amount of
the Outstanding Securities of such series may declare the principal amount (or,
if any of the Securities of such series are Discount Securities, such portion of
the principal amount of such Securities as may be specified in the terms thereof
as contemplated by Section 301) of all of the Securities of such series to be
due and payable immediately (provided that the payment of principal and interest
on such Securities shall remain subordinated to the extent provided in this
Indenture), by a notice in writing to the Company (and to the Trustee if given
by Holders), and upon receipt by the Company of notice of such declaration such
principal amount (or specified amount) shall become immediately due and payable;
provided, however, that if an Event of Default shall have occurred and be
continuing with respect to more than one series of Securities, the Trustee or
the Holders of not less than 25% in aggregate principal amount of the
Outstanding Securities of all such series, considered as one class, may make
such declaration of acceleration, and not the Holders of the Securities of any
one of such series (provided that the payment of principal and interest on such
Securities shall remain subordinated to the extent provided in this Indenture);
provided, further, that, in the case of the Securities of a series issued to a
Trust if, upon an Event of Default, the Trustee or the Holders of not less than
25% in principal amount of the Outstanding Securities of that series fail to
declare the principal amount (or, if the Securities of that series are Discount
Securities, such portion of the principal amount of such series as may be
specified in the terms thereof as

                                      -43-
<PAGE>   51

contemplated by Section 301) of all the Securities of that series to be
immediately due and payable, the holders of at least 25% in aggregate
liquidation amount of the Preferred Securities then outstanding shall have such
right by a notice to the Company and the Trustee; and upon any such declaration
such principal amount (or specified portion thereof) of and the accrued interest
on all the Securities of such series shall become immediately due and payable.

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

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

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

                        (1)     the principal of and premium, if any, on any
                Securities of such series then Outstanding which have become due
                otherwise than by such declaration of acceleration and interest
                thereon at the rate or rates prescribed therefor in such
                Securities;

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

                        (3)     all amounts due to the Trustee under Section
                907; and

                (b)     all Events of Default with respect to Securities of such
        series, other than the non-payment of the principal of Securities of
        such series which shall have become due solely by such declaration of
        acceleration, shall have been cured or waived as provided in Section
        813.

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

SECTION 803.           COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
                       TRUSTEE.

                If an Event of Default described in clause (a) or (b) of Section
801 shall have occurred, the Company or the Guarantor shall, upon demand of the
Trustee, pay to it, for the benefit of the Holders of the Securities of the
series with respect to which such Event of Default shall have occurred, the
whole amount then due and payable on such Securities for principal and premium,
if any, and interest, if any, and, to the extent permitted by law, interest on
premium, if any, and on any overdue principal and interest, at the rate or rates
prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover any amounts due to the Trustee under
Section 907.

                                      -44-
<PAGE>   52

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

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

SECTION 804.           TRUSTEE MAY FILE PROOFS OF CLAIM.

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

                (a)     to file and prove a claim for the whole amount of
        principal, premium, if any, and interest, if any, owing and unpaid in
        respect of the Securities and to file such other papers or documents as
        may be necessary or advisable in order to have the claims of the Trustee
        (including any claim for amounts due to the Trustee under Section 907)
        and of the Holders allowed in such judicial proceeding, and

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

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amounts due it under Section 907.

                Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding; provided,
however, that the Trustee may, on behalf of the Holders, be a member of a
creditors' or similar other committee.

                                      -45-
<PAGE>   53

SECTION 805.           TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
                       SECURITIES.

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

SECTION 806.           APPLICATION OF MONEY COLLECTED.

                Any money collected by the Trustee pursuant to this Article
shall be applied in the following order, to the extent permitted by law, at the
date or dates fixed by the Trustee and, in case of the distribution of such
money on account of principal or premium, if any, or interest, if any, upon
presentation of the Securities in respect of which or for the benefit of which
such money shall have been collected and the notation thereon of the payment if
only partially paid and upon surrender thereof if fully paid:

                        FIRST: To the payment of all amounts due the Trustee
                under Section 907;

                        SECOND: Subject to the provisions of Articles Fourteen
                and Fifteen, to the payment of the amounts then due and unpaid
                upon the Securities for principal of and premium, if any, and
                interest, if any, in respect of which or for the benefit of
                which such money has been collected, ratably, without preference
                or priority of any kind, according to the amounts due and
                payable on such Securities for principal, premium, if any, and
                interest, if any, respectively;

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

SECTION 807.           LIMITATION ON SUITS.

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

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

                (b)     the Holders of 25% in aggregate principal amount of the
        Outstanding Securities of all series in respect of which an Event of
        Default shall have occurred and be continuing, considered as one class,
        shall have made written request to the Trustee to institute proceedings
        in respect of such Event of Default in its own name as Trustee
        hereunder;

                                      -46-
<PAGE>   54

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

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

                (e)     no direction inconsistent with such written request
        shall have been given to the Trustee during such 60-day period by the
        Holders of a majority in aggregate principal amount of the Outstanding
        Securities of all series in respect of which an Event of Default shall
        have occurred and be continuing, considered as one class;

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

SECTION 808.          UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL,
                      PREMIUM AND INTEREST.

                Notwithstanding any other provision in this Indenture, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the principal of and premium, if any, and
(subject to Section 307 and 312) interest, if any, on such Security on the
Stated Maturity or Maturities expressed in such Security (or, in the case of
redemption, on the Redemption Date) and to institute suit for the enforcement of
any such payment, and such rights shall not be impaired without the consent of
such Holder. In addition, in the case of Securities of a series held by a Trust,
a holder of Preferred Trust Securities may directly institute a proceeding for
enforcement of payment to such holder of principal of or interest on the
Securities having a principal amount equal to the aggregate liquidation
preference amount of the Preferred Trust Securities of such holder on or after
the due dates specified or provided for in the Securities.

SECTION 809.           RESTORATION OF RIGHTS AND REMEDIES.

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

                                      -47-
<PAGE>   55

SECTION 810.           RIGHTS AND REMEDIES CUMULATIVE.

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

SECTION 811.           DELAY OR OMISSION NOT WAIVER.

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

SECTION 812.           CONTROL BY HOLDERS OF SECURITIES.

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

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

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

SECTION 813.           WAIVER OF PAST DEFAULTS.

                Subject to Section 802, the Holders of not less than a majority
in aggregate principal amount of the Outstanding Securities of any series may on
behalf of the Holders of all the Securities of such series waive any past
default hereunder with respect to such series and its consequences, except a
default

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

                                      -48-
<PAGE>   56

                (b)     in respect of a covenant or provision hereof which under
        Section 1202 cannot be modified or amended without the consent of the
        Holder of each Outstanding Security of such series affected

; provided, however, that so long as a Trust holds the Securities of any series,
such Trust may not waive any past default without the consent of at least a
majority in aggregate liquidation preference of the outstanding Preferred
Securities issued by such Trust affected, obtained as provided in the Trust
Agreement pertaining to such Trust. Any such waiver by holders of a majority in
aggregate liquidation preference of outstanding Preferred Securities issued by
any such Trust shall be deemed to be on behalf of all holders of Preferred
Securities issued by any such Trust.

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

SECTION 814.           UNDERTAKING FOR COSTS.

                The Company, the Guarantor and the Trustee agree, and each
Holder by his acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of any right or
remedy under this Indenture, or in any suit against the Trustee for any action
taken, suffered or omitted by it as Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party litigant, in each
case in the manner, to the extent, and subject to the exceptions provided in the
Trust Indenture Act; provided, that the provisions of this Section shall not be
deemed to authorize any court to require such an undertaking or to make such an
assessment in any suit instituted by the Company or the Guarantor.

SECTION 815.           WAIVER OF USURY, STAY OR EXTENSION LAWS.

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

                                      -49-
<PAGE>   57

                                  ARTICLE NINE

                                   THE TRUSTEE

SECTION 901.           CERTAIN DUTIES AND RESPONSIBILITIES.

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

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

                        (2)     in the absence of bad faith on its part, the
                Trustee may, with respect to Securities of such series,
                conclusively rely, as to the truth of the statements and the
                correctness of the opinions expressed therein, upon certificates
                or opinions furnished to the Trustee and conforming to the
                requirements of this Indenture; but in the case of any such
                certificates or opinions which by any 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
                Indenture.

                (b)     In case an Event of Default with respect to Securities
of any series shall have occurred and be continuing, the Trustee shall exercise,
with respect to Securities of such series, such of the rights and powers vested
in it by this Indenture, and use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.

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

                        (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, 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 Holders of a majority in
                principal amount of the Outstanding Securities of any one or
                more series, as provided herein, relating to the time, method
                and place of conducting any proceeding for any remedy available
                to the Trustee, or exercising any trust or power conferred upon
                the Trustee, under this Indenture with respect to the Securities
                of such series; and

                                      -50-
<PAGE>   58

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

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

SECTION 902.           NOTICE OF DEFAULTS.

                The Trustee shall give notice of any default hereunder with
respect to the Securities of any series to the Holders of Securities of such
series in the manner and to the extent required to do so by the Trust Indenture
Act, unless such default shall have been cured or waived; provided, however,
that in the case of any default of the character specified in Section 801(c), no
such notice to Holders shall be given until at least 90 days after the
occurrence thereof. For the purpose of this Section, the term "default" means
any event which is, or after notice or lapse of time, or both, would become, an
Event of Default with respect to the Securities of such series.

SECTION 903.           CERTAIN RIGHTS OF TRUSTEE.

                Subject to the provisions of Section 901 and to the applicable
provisions of the Trust Indenture Act:

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

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

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

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

                                      -51-
<PAGE>   59

                (e)     the Trustee shall be under no obligation to exercise any
        of the rights or powers vested in it by this Indenture at the request or
        direction of any Holder pursuant to this Indenture, unless such Holder
        shall have offered to the Trustee reasonable security or indemnity
        against the costs, expenses and liabilities which might be incurred by
        it 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, note, other evidence of indebtedness or
        other paper or document, but the Trustee, in its discretion, may make
        such further inquiry or investigation into such facts or matters as it
        may see fit, and, if the Trustee shall determine to make such further
        inquiry or investigation, it shall (subject to applicable legal
        requirements) be entitled to examine, during normal business hours, the
        books, records and premises of the Company or the Guarantor, personally
        or by agent or attorney;

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

                (h)     the Trustee shall not be charged with knowledge of any
        Event of Default with respect to the Securities of any series for which
        it is acting as Trustee unless either (1) a Responsible Officer of the
        Trustee assigned to the Corporate Trustee Administration Department of
        the Trustee (or any successor division or department of the Trustee)
        shall have actual knowledge of the Event of Default or (2) written
        notice of such Event of Default shall have been given to the Trustee by
        the Company or the Guarantor or any other obligor on such Securities, or
        by any Holder of such Securities.

SECTION 904.           NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.

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

SECTION 905.           MAY HOLD SECURITIES.

                Each of the Trustee, any Authenticating Agent, any Paying Agent,
any Security Registrar or any other agent of the Company or the Guarantor, in
its individual or any other capacity, may become the owner or pledgee of
Securities and/or Preferred Securities and, subject to Sections 908 and 913, may
otherwise deal with the Company or the Guarantor with the same rights it would
have if it were not the Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other agent.

                                      -52-
<PAGE>   60

SECTION 906.           MONEY HELD IN TRUST.

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

SECTION 907.           COMPENSATION AND REIMBURSEMENT.

                The Company and the Guarantor jointly and severally agree

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

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

                (c)     to indemnify the Trustee and hold it harmless from and
        against, any loss, liability or expense reasonably incurred without
        negligence, willful misconduct or bad faith on its part, arising out of
        or in connection with the acceptance or administration of the trust or
        trusts hereunder, including the costs and expenses of defending itself
        against any claim or liability in connection with the exercise or
        performance of any of its powers or duties hereunder.

                As security for the performance of the obligations of the
Company and the Guarantor under this Section, the Trustee shall have a lien
prior to the Securities upon all property and funds held or collected by the
Trustee as such, other than property and funds held in trust under Section 703
(except moneys payable to the Company as provided in Section 703).

                When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 801, the expenses and compensation for the
services (including the fees and expenses of its counsel) are intended to
constitute expenses of administration under any bankruptcy Law.

                The provisions of this Section 907 shall survive the resignation
or removal of the Trustee and the termination of this Indenture.

SECTION 908.           DISQUALIFICATION; CONFLICTING INTERESTS.

                If the Trustee shall have or acquire any conflicting interest
within the meaning of the Trust Indenture Act, it shall either eliminate such
conflicting interest or resign to the extent, in the manner and with the effect,
and subject to the conditions, provided in the Trust Indenture Act and this
Indenture. For purposes of Section 310(b)(1) of the Trust Indenture Act and to
the

                                      -53-
<PAGE>   61

extent permitted thereby, the Trustee, in its capacity as trustee in respect
of the Securities of any series, shall not be deemed to have a conflicting
interest arising from its capacity as trustee in respect of (i) the Securities
of any other series, (ii) the Trust Agreement and the Trust Securities Guarantee
Agreement pertaining to each Trust.

SECTION 909.           CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.

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

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

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

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

SECTION 910.           RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.

                (a)     No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 911.

                (b)     The Trustee may resign at any time with respect to the
Securities of one or more series by giving written notice thereof to the Company
and the Guarantor. If the instrument of acceptance by a successor Trustee
required by Section 911 shall not have been delivered to the Trustee 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 with respect to the Securities of such series.

                (c)     The Trustee may be removed at any time with respect to
the Securities of any series by Act of the Holders of a majority in principal
amount of the Outstanding Securities of such series delivered to the Trustee,
the Company and the Guarantor; provided that so long as

                                      -54-
<PAGE>   62

any Preferred Securities remain outstanding, the Trust which issued such
Preferred Securities shall not execute any Act to remove the Trustee without the
consent of the holders of a majority in aggregate liquidation preference of
Preferred Securities issued by such Trust outstanding, obtained as provided in
the Trust Agreement pertaining to such Trust.

                (d)     If at any time:

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

                        (2)     the Trustee shall cease to be eligible under
                Section 909 or Section 310(a) of the Trust Indenture Act and
                shall fail to resign after written request therefor by the
                Company, the Guarantor or by any such Holder, or

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

then, in any such case, (x) the Company and the Guarantor by Board Resolutions
may remove the Trustee with respect to all Securities or (y) subject to Section
814, any Holder who has been a bona fide Holder 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 with respect to all
Securities and the appointment of a successor Trustee or Trustees.

                (e)     If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause (other than as contemplated by clause (y) in subsection (d) or this
Section), with respect to the Securities of one or more series, the Company and
the Guarantor, by Board Resolutions, shall promptly appoint a successor Trustee
or Trustees with respect to the Securities of that or those series (it being
understood that any such successor Trustee may be appointed with respect to the
Securities of one or more or all of such series and that at any time (subject to
Section 915) there shall be only one Trustee with respect to the Securities of
any particular series) and shall comply with the applicable requirements of
Section 911. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee with
respect to the Securities of any series shall be appointed by Act of the Holders
of a majority in principal amount of the Outstanding Securities of such series
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment in accordance
with the applicable requirements of Section 911, become the successor Trustee
with respect to the Securities of such series and to that extent supersede the
successor Trustee appointed by the Company and the Guarantor. If no successor
Trustee with respect to the Securities of any series shall have been so
appointed by the Company and the Guarantor or the Holders and accepted
appointment in the manner required by Section 911, any Holder who has been a
bona fide Holder of a Security of such series for at least six months may, on
behalf of itself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee with respect
to the Securities of such series.

                                      -55-
<PAGE>   63

                (f)     So long as no event which is, or after notice or lapse
of time, or both, would become, an Event of Default shall have occurred and be
continuing, and except with respect to a Trustee appointed by Act of the Holders
of a majority in principal amount of the Outstanding Securities pursuant to
subsection (e) of this Section, if the Company and the Guarantor shall have
delivered to the Trustee (i) Board Resolutions of the Company and the Guarantor
appointing a successor Trustee, effective as of a date specified therein, and
(ii) an instrument of acceptance of such appointment, effective as of such date,
by such successor Trustee in accordance with Section 911, the Trustee shall be
deemed to have resigned as contemplated in subsection (b) of this Section, the
successor Trustee shall be deemed to have been appointed by the Company and the
Guarantor pursuant to subsection (e) of this Section and such appointment shall
be deemed to have been accepted as contemplated in Section 911, all as of such
date, and all other provisions of this Section and Section 911 shall be
applicable to such resignation, appointment and acceptance except to the extent
inconsistent with this subsection (f).

                (g)     The Company shall give notice of each resignation and
each removal of the Trustee with respect to the Securities of any series and
each appointment of a successor Trustee with respect to the Securities of any
series to all Holders of Securities of such series in the manner provided in
Section 106. Each notice shall include the name of the successor Trustee with
respect to the Securities of such series and the address of its Corporate Trust
Office.

SECTION 911.           ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.

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

                (b)     In case of the appointment hereunder of a successor
Trustee with respect to the Securities of one or more (but not all) series, the
Company, the Guarantor, the retiring Trustee and each successor Trustee with
respect to the Securities of one or more series shall execute and deliver an
indenture supplemental hereto wherein each successor Trustee shall accept such
appointment and which (1) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, each successor Trustee all
the rights, powers, trusts and duties of the retiring Trustee with respect to
the Securities of that or those series to which the appointment of such
successor Trustee relates, (2) if the retiring Trustee is not retiring with
respect to all Securities, shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those series
as to which the retiring Trustee is not retiring shall continue to be vested in
the retiring Trustee and (3) shall add to or change any of the provisions

                                      -56-
<PAGE>   64

of this Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee; and upon
the execution and delivery of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein and each such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those series
to which the appointment of such successor Trustee relates; but, on request of
the Company, the Guarantor or any successor Trustee, such retiring Trustee, upon
payment of all sums owed to it, shall duly assign, transfer and deliver to such
successor Trustee all property and money held by such retiring Trustee hereunder
with respect to the Securities of that or those series to which the appointment
of such successor Trustee relates.

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

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

SECTION 912.           MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
                       BUSINESS.

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

SECTION 913.           PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.

                If the Trustee shall be or become a creditor of the Company, the
Guarantor or any other obligor upon the Securities (other than by reason of a
relationship described in Section 311(b) of the Trust Indenture Act), the
Trustee shall be subject to any and all applicable provisions of the Trust
Indenture Act regarding the collection of claims against the Company, the
Guarantor or such other obligor. For purposes of Section 311(b) of the Trust
Indenture Act (a) the term "cash transaction" shall have the meaning provided in
Rule 11b-4 under the Trust Indenture Act, and (b) the term "self-liquidating
paper" shall have the meaning provided in Rule 11b-6 under the Trust Indenture
Act.

                                      -57-
<PAGE>   65

SECTION 914.           APPOINTMENT OF AUTHENTICATING AGENT.

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

                Any corporation into which an Authenticating Agent may be merged
or converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.

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

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

                                      -58-
<PAGE>   66
                The provisions of Sections 308, 904 and 905 shall be applicable
to each Authenticating Agent.

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

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

                              The Chase Manhattan Bank
                              ------------------------------------------------
                              As Trustee

                              By
                                     ----------------------------------
                                     As Authenticating Agent

                              By
                                     ----------------------------------
                                     Authorized Officer

                If all of the Securities of a series may not be originally
issued at one time, and if the Trustee does not have an office capable of
authenticating Securities upon original issuance located in a Place of Payment
where the Company wishes to have Securities of such series authenticated upon
original issuance, the Trustee, if so requested by the Company in writing (which
writing need not comply with Section 102 and need not be accompanied by an
Opinion of Counsel), shall appoint, in accordance with this Section and in
accordance with such procedures as shall be acceptable to the Trustee, an
Authenticating Agent having an office in a Place of Payment designated by the
Company with respect to such series of Securities.

SECTION 915.           CO-TRUSTEE AND SEPARATE TRUSTEES.

                At any time or times, for the purpose of meeting the legal
requirements of any applicable jurisdiction, the Company, the Guarantor and the
Trustee shall have power to appoint, and, upon the written request of the
Trustee or of the Holders of at least 33% in principal amount of the Securities
then Outstanding, the Company and the Guarantor shall for such purpose join with
the Trustee in the execution and delivery of all instruments and agreements
necessary or proper to appoint, one or more Persons approved by the Trustee
either to act as co-trustee, jointly with the Trustee, or to act as separate
trustee, in either case with such powers as may be provided in the instrument of
appointment, and to vest in such Person or Persons, in the capacity aforesaid,
any property, title, right or power deemed necessary or desirable, subject to
the other provisions of this Section. If the Company or the Guarantor does not
join in such appointment within 15 days after the receipt by it of a request so
to do, or if an Event of Default shall have occurred and be continuing, the
Trustee alone shall have power to make such appointment.

                                      -59-
<PAGE>   67

                Should any written instrument or instruments from the Company or
the Guarantor be required by any co-trustee or separate trustee to more fully
confirm to such co-trustee or separate trustee such property, title, right or
power, any and all such instruments shall, on request, be executed, acknowledged
and delivered by the Company or the Guarantor, as the case may be.

                Every co-trustee or separate trustee shall, to the extent
permitted by law, but to such extent only, be appointed subject to the following
conditions:

                (a)     the Securities shall be authenticated and delivered, and
all rights, powers, duties and obligations hereunder in respect of the custody
of securities, cash and other personal property held by, or required to be
deposited or pledged with, the Trustee hereunder, shall be exercised solely, by
the Trustee;

                (b)     the rights, powers, duties and obligations hereby
conferred or imposed upon the Trustee in respect of any property covered by such
appointment shall be conferred or imposed upon and exercised or performed either
by the Trustee or by the Trustee and such co-trustee or separate trustee
jointly, as shall be provided in the instrument appointing such co-trustee or
separate trustee, except to the extent that under any law of any jurisdiction in
which any particular act is to be performed, the Trustee shall be incompetent or
unqualified to perform such act, in which event such rights, powers, duties and
obligations shall be exercised and performed by such co-trustee or separate
trustee.

                (c)     the Trustee at any time, by an instrument in writing
executed by it, with the concurrence of the Company and the Guarantor, may
accept the resignation of or remove any co-trustee or separate trustee appointed
under this Section, and, if an Event of Default shall have occurred and be
continuing, the Trustee shall have power to accept the resignation of, or
remove, any such co-trustee or separate trustee without the concurrence of the
Company or the Guarantor. Upon the written request of the Trustee, the Company
and the Guarantor shall join with the Trustee in the execution and delivery of
all instruments and agreements necessary or proper to effectuate such
resignation or removal. A successor to any co-trustee or separate trustee so
resigned or removed may be appointed in the manner provided in this Section;

                (d)     no co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Trustee, or any other
such trustee hereunder, and the Trustee shall not be personally liable by reason
of any act or omission of any such co-trustee or separate trustee; and

                (e)     any Act of Holders delivered to the Trustee shall be
deemed to have been delivered to each such co-trustee and separate trustee.

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                                  ARTICLE TEN

                 HOLDERS' LISTS AND REPORTS BY TRUSTEE, COMPANY AND GUARANTOR

SECTION 1001.         LISTS OF HOLDERS.

                Semiannually, not later than June 30 and December 31 in each
year, and at such other times as the Trustee may request in writing, the Company
and the Guarantor shall furnish or cause to be furnished to the Trustee
information as to the names and addresses of the Holders, and the Trustee shall
preserve such information and similar information received by it in any other
capacity and afford to the Holders access to information so preserved by it, all
to such extent, if any, and in such manner as shall be required by the Trust
Indenture Act; provided, however, that no such list need be furnished so long as
the Trustee shall be the Security Registrar.

SECTION 1002.         REPORTS BY TRUSTEE, COMPANY AND GUARANTOR.

                The Trustee shall transmit to Holders such reports concerning
the Trustee and its actions under this Indenture as may be required pursuant to
the Trust Indenture Act at the time and in the manner provided pursuant thereto.
Reports so required to be transmitted at stated intervals of not more than 12
months shall be transmitted no later than July 15 in each calendar year with
respect to the 12-month period ending on the preceding May 15 commencing May 15,
2002. A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Company and the
Guarantor. The Company and the Guarantor will notify the Trustee when any
Securities are listed on any stock exchange.

                The Company and the Guarantor shall file with the Trustee
(within thirty (30) days after filing with the Commission in the case of reports
that pursuant to the Trust Indenture Act must be filed with the Commission and
furnished to the Trustee) and transmit to the Holders, such other information,
reports and other documents, if any, at such times and in such manner, as shall
be required by the Trust Indenture Act.

                                 ARTICLE ELEVEN

              CONSOLIDATION, MERGER, CONVEYANCE, OR OTHER TRANSFER

SECTION 1101.         COMPANY OR GUARANTOR MAY CONSOLIDATE, ETC.,
                      ONLY ON CERTAIN TERMS.

                Neither the Company nor the Guarantor shall consolidate with or
merge into any other Person or convey, transfer or lease its properties and
assets substantially as an entirety to any Person, unless

                (a)     the Person formed by such consolidation or into which
        the Company or Guarantor, as the case may be, is merged or the Person
        which acquires by conveyance or transfer, or which leases, the
        properties and assets of the Company or the Guarantor, as the case may
        be, substantially as an entirety shall be a Person organized and
        existing

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<PAGE>   69

        under the laws of the United States, any State thereof or the District
        of Columbia, and shall expressly assume, by an indenture supplemental
        hereto, executed and delivered to the Trustee, in form satisfactory to
        the Trustee, the due and punctual payment of the principal of and
        premium, if any, and interest, if any, on all Outstanding Securities (or
        the Guarantees endorsed thereon, as the case may be) and the performance
        of every covenant of this Indenture on the part of the Company or the
        Guarantor, as the case may be, to be performed or observed;

                (b)     immediately after giving effect to such transaction, no
        Event of Default, and no event which, after notice or lapse of time or
        both, would become an Event of Default, shall have occurred and be
        continuing; and

                (c)     the Company or the Guarantor, as the case may be, shall
        have delivered to the Trustee an Officer's Certificate and an Opinion of
        Counsel, each stating that such consolidation, merger, conveyance or
        other transfer or lease and such indenture supplemental hereto complies
        with this Article and that all conditions precedent herein provided for
        relating to such transactions have been complied with.

SECTION 1102.        SUCCESSOR PERSON SUBSTITUTED.

                Upon any consolidation by the Company or the Guarantor with or
merger by the Company or the Guarantor into any other Person or any conveyance
or other transfer or lease of the properties and assets of the Company or the
Guarantor substantially as an entirety in accordance with Section 1101, the
successor Person formed by such consolidation or into which the Company or the
Guarantor, as the case may be, is merged or the Person to which such conveyance,
or other transfer or lease is made shall succeed to, and be substituted for, and
may exercise every right and power of, the Company or the Guarantor, as the case
may be, under this Indenture with the same effect as if such successor Person
had been named as the Company or the Guarantor, as the case may be, herein, and
thereafter, except in the case of a lease, the predecessor Person shall be
relieved of all obligations and covenants under this Indenture and the
Securities Outstanding hereunder (or the Guarantees endorsed thereon, as the
case may be).

SECTION 1103.        LIMITATION.

                Nothing in this Indenture shall be deemed to prevent or
restrict:

                (a)     any consolidation or merger after the consummation of
        which the Company or the Guarantor would be the surviving or resulting
        entity,

                (b)     any consolidation of the Company with the Guarantor or
        any other Person all of the outstanding voting securities of which are
        owned, directly or indirectly, by the Guarantor; or any merger of any of
        such Persons into any other of such Persons; or any conveyance or other
        transfer, or lease, of its properties substantially as an entirety by
        any thereof to any other thereof,

                (c)     any conveyance or other transfer, or lease, of any part
        of the properties of the Company or the Guarantor which does not
        constitute the entirety, or substantially the entirety, thereof or

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<PAGE>   70

                (d)     the approval by the Company or the Guarantor of, or the
        consent by the Company or the Guarantor to, any consolidation or merger
        to which any direct or indirect subsidiary or affiliate of the Company
        or the Guarantor, as the case requires, may be a party or any
        conveyance, transfer or lease by any such subsidiary or affiliate of any
        of its assets.

                                 ARTICLE TWELVE

                             SUPPLEMENTAL INDENTURES

SECTION 1201.        SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.

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

                (a)     to evidence the succession of another Person to the
        Company or the Guarantor, as the case may be, and the assumption by any
        such successor of the covenants of the Company or the Guarantor, as the
        case may be, herein and in the Securities or the Guarantees endorsed
        thereon, all as provided in Article Eleven; or

                (b)     to add one or more covenants of the Company or the
        Guarantor or other provisions for the benefit of the Holders of all or
        any series of Securities, or any Tranche thereof or to surrender any
        right or power herein conferred upon the Company or the Guarantor (and
        if such covenants are to be for the benefit of less than all series of
        Securities, stating that such covenants are expressly being included
        solely for the benefit of such series); or

                (c)     to add any additional Events of Default with respect to
        all or any series of Securities Outstanding hereunder (and if such
        additional Events of Default are to be for the benefit of less than all
        series of Securities, stating that such additional Events of Default are
        expressly being included solely for the benefit of such series); or

                (d)     to change or eliminate any provision of this Indenture
        or to add any new provision to this Indenture; provided, however, that
        if such change, elimination or addition shall adversely affect the
        interests of the Holders of Securities of any series or Tranche
        Outstanding on the date of such supplemental indenture in any material
        respect, such change, elimination or addition shall become effective
        with respect to such series or Tranche only pursuant to the provisions
        of Section 1202 hereof or when no Security of such series or Tranche
        remains Outstanding; or

                (e)     to provide collateral security for the Securities of any
        series; or

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

                (g)     to provide for the authentication and delivery of bearer
        securities and coupons appertaining thereto representing interest, if
        any, thereon and for the procedures

                                      -63-
<PAGE>   71

        for the registration, exchange and replacement thereof and for the
        giving of notice to, and the solicitation of the vote or consent of, the
        holders thereof, and for any and all other matters incidental thereto;
        or

                (h)     to evidence and provide for the acceptance of
        appointment hereunder by a separate or successor Trustee or co-trustee
        with respect to the Securities of one or more series and to add to or
        change any of the provisions of this Indenture as shall be necessary to
        provide for or facilitate the administration of the trusts hereunder by
        more than one Trustee, pursuant to the requirements of Section 911(b);
        or

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

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

                (k)     to cure any ambiguity, to correct or supplement any
        provision herein which may be defective or inconsistent with any other
        provision herein, or to make any other changes to the provisions hereof
        or to add other provisions with respect to matters or questions arising
        under this Indenture, provided that such other changes or additions
        shall not adversely affect the interests of the Holders of Securities of
        any series or Tranche or, in the case of the Securities of a series
        issued to a Trust and for so long as any of the Preferred Securities
        issued by such Trust remain outstanding, the holder of such Preferred
        Securities, in any material respect.

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

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

                        (y)     if any such amendment shall permit one or more
                changes to, or the elimination of, any provisions hereof which,
                at the date of the execution and delivery hereof or at any time
                thereafter, are required by the Trust Indenture Act

                                      -64-
<PAGE>   72

                to be contained herein or are contained herein to reflect any
                provision of the Trust Indenture Act as in effect at such date,
                this Indenture shall be deemed to have been amended to effect
                such changes or elimination, and the Company, the Guarantor and
                the Trustee may, without the consent of any Holders, enter into
                an indenture supplemental hereto to this Indenture to effect
                such changes or elimination or evidence such amendment.

SECTION 1202.        SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.

                Subject to the provisions of Section 1201, with the consent of
the Holders of not less than a majority in aggregate principal amount of the
Securities of all series then Outstanding under this Indenture, considered as
one class, by Act of said Holders delivered to the Company, the Guarantor and
the Trustee, the Company and the Guarantor, when authorized by Board
Resolutions, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture; provided,
however, that if there shall be Securities of more than one series Outstanding
hereunder and if a proposed supplemental indenture shall directly affect the
rights of the Holders of Securities of one or more, but less than all, of such
series, then the consent only of the Holders of a majority in aggregate
principal amount of the Outstanding Securities of all series so directly
affected, considered as one class, shall be required; and provided, further,
that if the Securities of any series shall have been issued in more than one
Tranche and if the proposed supplemental indenture shall directly affect the
rights of the Holders of Securities of one or more, but less than all, of such
Tranches, then the consent only of the Holders of a majority in aggregate
principal amount of the Outstanding Securities of all Tranches so directly
affected, considered as one class, shall be required; and provided, further,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security of each series or Tranche so directly affected,

                (a)     change the Stated Maturity of the principal of, or any
        installment of principal of or interest on (except as provided in
        Section 312 hereof), any Security (other than pursuant to the terms
        thereof), or reduce the principal amount thereof or the rate of interest
        thereon (or the amount of any installment of interest thereon) or change
        the method of calculating such rate or reduce any premium payable upon
        the redemption thereof, or reduce the amount of the principal of a
        Discount Security that would be due and payable upon a declaration of
        acceleration of the Maturity thereof pursuant to Section 802, or change
        the coin or currency (or other property), in which any Security or any
        premium or the interest thereon is payable, or impair the right to
        institute suit for the enforcement of any such payment on or after the
        Stated Maturity thereof (or, in the case of redemption, on or after the
        Redemption Date), or

                (b)     reduce the percentage in principal amount of the
        Outstanding Securities of any series (or, if applicable, in liquidation
        preference of any series of Preferred Securities) or any Tranche
        thereof, the consent of the Holders of which is required for any such
        supplemental indenture, or the consent of the Holders of which is
        required for any waiver of compliance with any provision of this
        Indenture or of any default hereunder and its consequences, or reduce
        the requirements of Section 1304 for quorum or voting, or

                                      -65-
<PAGE>   73

                (c)     modify any of the provisions of this Section, Section
        606 or Section 813 with respect to the Securities of any series or any
        Tranche thereof, except to increase the percentages in principal amount
        referred to in this Section or such other Sections or to provide that
        other provisions of this Indenture cannot be modified or waived without
        the consent of the Holder of each Outstanding Security affected thereby;
        provided, however, that this clause shall not be deemed to require the
        consent of any Holder with respect to changes in the references to "the
        Trustee" and concomitant changes in this Section, or the deletion of
        this proviso, in accordance with the requirements of Sections 911(b) and
        1201(h).

Notwithstanding the foregoing, so long as any of the Preferred Securities remain
outstanding, the Trustee may not consent to a supplemental indenture under this
Section 1202 without the prior consent, obtained as provided in a Trust
Agreement pertaining to a Trust which issued such Preferred Securities, of the
holders of not less than a majority in aggregate liquidation preference of all
Preferred Securities issued by such Trust affected, considered as one class, or,
in the case of changes described in clauses (a), (b) and (c) above, 100% in
aggregate liquidation preference of all such Preferred Securities then
outstanding which would be affected thereby, considered as one class. A
supplemental indenture which (x) changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of the Holders of, or which is to remain in effect only so long as there
shall be Outstanding, Securities of one or more particular series, or one or
more Tranches thereof, or (y) modifies the rights of the Holders of Securities
of such series or Tranches with respect to such covenant or other provision,
shall be deemed not to affect the rights under this Indenture of the Holders of
Securities of any other series or Tranche.

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

SECTION 1203.        EXECUTION OF SUPPLEMENTAL INDENTURES.

                In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 901) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture and that all conditions precedent have
been complied with by the Company. The Trustee may, but shall not be obligated
to, enter into any such supplemental indenture which affects the Trustee's own
rights, duties, immunities or liabilities under this Indenture or otherwise.

SECTION 1204.        EFFECT OF SUPPLEMENTAL INDENTURES.

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

                                      -66-
<PAGE>   74

delivery thereof, any such restatement shall supersede this Indenture as
theretofore in effect for all purposes.

SECTION 1205.        CONFORMITY WITH TRUST INDENTURE ACT.

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

SECTION 1206.        REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.

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

SECTION 1207.        MODIFICATION WITHOUT SUPPLEMENTAL INDENTURE.

                To the extent, if any, that the terms of any particular series
of Securities shall have been established in or pursuant to a Board Resolution
or an Officer's Certificate pursuant to a supplemental indenture or Board
Resolution as contemplated by Section 301, and not in an indenture supplemental
hereto, additions to, changes in or the elimination of any of such terms may be
effected by means of a supplemental Board Resolution or Officer's Certificate,
as the case may be, delivered to, and accepted by, the Trustee; provided,
however, that such supplemental Board Resolution or Officer's Certificate shall
not be accepted by the Trustee or otherwise be effective unless all conditions
set forth in this Indenture which would be required to be satisfied if such
additions, changes or elimination were contained in a supplemental indenture
shall have been appropriately satisfied. Upon the acceptance thereof by the
Trustee, any such supplemental Board Resolution or Officer's Certificate shall
be deemed to be a "supplemental indenture" for purposes of Section 1204 and
1206.

                                ARTICLE THIRTEEN

                   MEETINGS OF HOLDERS; ACTION WITHOUT MEETING

SECTION 1301.        PURPOSES FOR WHICH MEETINGS MAY BE CALLED.

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

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<PAGE>   75

SECTION 1302.        CALL, NOTICE AND PLACE OF MEETINGS.

                (a)     The Trustee may at any time call a meeting of Holders of
        Securities of one or more, or all, series, or any Tranche or Tranches
        thereof, for any purpose specified in Section 1301, to be held at such
        time and at such place in the Borough of Manhattan, The City of New
        York, as the Trustee shall determine, or, with the approval of the
        Company, at any other place. Notice of every such meeting, setting forth
        the time and the place of such meeting and in general terms the action
        proposed to be taken at such meeting, shall be given, in the manner
        provided in Section 106, not less than 21 nor more than 180 days prior
        to the date fixed for the meeting.

                (b)     If the Trustee shall have been requested to call a
        meeting of the Holders of Securities of one or more, or all, series, or
        any Tranche or Tranches thereof, by the Company, the Guarantor or by the
        Holders of 33% in aggregate principal amount of all of such series and
        Tranches, considered as one class, for any purpose specified in Section
        1301, by written request setting forth in reasonable detail the action
        proposed to be taken at the meeting, and the Trustee shall not have
        given the notice of such meeting within 21 days after receipt of such
        request or shall not thereafter proceed to cause the meeting to be held
        as provided herein, then the Company, the Guarantor or the Holders of
        Securities of such series and Tranches in the amount above specified, as
        the case may be, may determine the time and the place in the Borough of
        Manhattan, The City of New York, or in such other place as shall be
        determined or approved by the Company or the Guarantor, for such meeting
        and may call such meeting for such purposes by giving notice thereof as
        provided in subsection (a) of this Section.

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

SECTION 1303.        PERSONS ENTITLED TO VOTE AT MEETINGS.

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

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<PAGE>   76

SECTION 1304.        QUORUM; ACTION.

                The Persons entitled to vote a majority in aggregate principal
amount of the Outstanding Securities of the series and Tranches with respect to
which a meeting shall have been called as hereinbefore provided, considered as
one class, shall constitute a quorum for a meeting of Holders of Securities of
such series and Tranches; provided, however, that if any action is to be taken
at such meeting which this Indenture expressly provides may be taken by the
Holders of a specified percentage, which is less than a majority, in principal
amount of the Outstanding Securities of such series and Tranches, considered as
one class, the Persons entitled to vote such specified percentage in principal
amount of the Outstanding Securities of such series and Tranches, considered as
one class, shall constitute a quorum. In the absence of a quorum within one hour
of the time appointed for any such meeting, the meeting shall, if convened at
the request of Holders of Securities of such series and Tranches, be dissolved.
In any other case the meeting may be adjourned for such period as may be
determined by the chairman of the meeting prior to the adjournment of such
meeting. In the absence of a quorum at any such adjourned meeting, such
adjourned meeting may be further adjourned for such period as may be determined
by the chairman of the meeting prior to the adjournment of such adjourned
meeting. Except as provided by Section 1305(e), notice of the reconvening of any
meeting adjourned for more than 30 days shall be given as provided in Section
1302(a) not less than ten days prior to the date on which the meeting is
scheduled to be reconvened. Notice of the reconvening of an adjourned meeting
shall state expressly the percentage, as provided above, of the principal amount
of the Outstanding Securities of such series and Tranches which shall constitute
a quorum.

                Except as limited by Section 1202, any resolution presented to a
meeting or adjourned meeting duly reconvened at which a quorum is present as
aforesaid may be adopted only by the affirmative vote of the Holders of a
majority in aggregate principal amount of the Outstanding Securities of the
series and Tranches with respect to which such meeting shall have been called,
considered as one class; provided, however, that, except as so limited, any
resolution with respect to any action which this Indenture expressly provides
may be taken by the Holders of a specified percentage, which is less than a
majority, in principal amount of the Outstanding Securities of such series and
Tranches, considered as one class, may be adopted at a meeting or an adjourned
meeting duly reconvened and at which a quorum is present as aforesaid by the
affirmative vote of the Holders of such specified percentage in principal amount
of the Outstanding Securities of such series and Tranches, considered as one
class.

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

SECTION 1305.        ATTENDANCE AT MEETINGS; DETERMINATION OF VOTING RIGHTS;
                     CONDUCT AND ADJOURNMENT OF MEETINGS.

                (a)     Attendance at meetings of Holders of Securities may be
        in person or by proxy; and, to the extent permitted by law, any such
        proxy shall remain in effect and be binding upon any future Holder of
        the Securities with respect to which it was given

                                      -69-
<PAGE>   77

        unless and until specifically revoked by the Holder or future Holder of
        such Securities before being voted.

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

                (c)     The Trustee shall, by an instrument in writing, appoint
        a temporary chairman of the meeting, unless the meeting shall have been
        called by the Company or the Guarantor or by Holders as provided in
        Section 1302(b), in which case the Company or the Guarantor or the
        Holders of Securities of the series and Tranches calling the meeting, as
        the case may be, shall in like manner appoint a temporary chairman. A
        permanent chairman and a permanent secretary of the meeting shall be
        elected by vote of the Persons entitled to vote a majority in aggregate
        principal amount of the Outstanding Securities of all series and
        Tranches represented at the meeting, considered as one class.

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

                (e)     Any meeting duly called pursuant to Section 1302 at
        which a quorum is present may be adjourned from time to time by Persons
        entitled to vote a majority in aggregate principal amount of the
        Outstanding Securities of all series and Tranches represented at the
        meeting, considered as one class; and the meeting may be held as so
        adjourned without further notice.

SECTION 1306.        COUNTING VOTES AND RECORDING ACTION OF MEETINGS.

                The vote upon any resolution submitted to any meeting of Holders
shall be by written ballots on which shall be subscribed the signatures of the
Holders or of their representatives by proxy and the principal amounts and
serial numbers of the Outstanding Securities, of the series and Tranches with
respect to which the meeting shall have been called, held or represented by
them. The permanent chairman of the meeting shall appoint two inspectors of
votes who shall count all votes cast at the meeting for or against any
resolution and who shall make and file with the secretary of the meeting their
verified written reports of all votes cast at the meeting. A record, in
duplicate, of the proceedings of each meeting of Holders

                                      -70-
<PAGE>   78

shall be prepared by the secretary of the meeting and there shall be attached to
said record the original reports of the inspectors of votes on any vote by
ballot taken thereat and affidavits by one or more persons having knowledge of
the facts setting forth a copy of the notice of the meeting and showing that
said notice was given as provided in Section 1302 and, if applicable, Section
1304. Each copy shall be signed and verified by the affidavits of the permanent
chairman and secretary of the meeting and one such copy shall be delivered to
the Company, and another to the Trustee to be preserved by the Trustee, the
latter to have attached thereto the ballots voted at the meeting. Any record so
signed and verified shall be conclusive evidence of the matters therein stated.

SECTION 1307.        ACTION WITHOUT MEETING.

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

                                ARTICLE FOURTEEN

                                    GUARANTEE

SECTION 1401.        GUARANTEE.

                The Guarantor hereby unconditionally guarantees to each Holder
of a Security authenticated and delivered by the Trustee, and to the Trustee on
behalf of such Holder, the due and punctual payment of the principal of, and
premium, if any, and interest, if any, on the Securities of such series when and
as the same shall become due and payable, whether at the Stated Maturity, by
declaration of acceleration, call for redemption, or otherwise, in accordance
with the terms of such Security and of this Indenture. In case of the failure of
the Company punctually to make any such payment, the Guarantor hereby agrees to
cause such payment to be made punctually when and as the same shall become due
and payable, whether at the Stated Maturity or by declaration of acceleration,
call for redemption or otherwise, and as if such payment were made by the
Company.

                The Guarantor hereby agrees that its obligations hereunder shall
be absolute and unconditional irrespective of, and shall be unaffected by, any
invalidity, irregularity or unenforceability of such Security or this Indenture,
any failure to enforce the provisions of such Security or this Indenture, or any
waiver, modification or indulgence granted to the Company with respect thereto,
by the Holder of such Security or the Trustee or any other circumstance which
may otherwise constitute a legal or equitable discharge or defense of a surety
or guarantor; provided, however, that notwithstanding the foregoing, no such
waiver, modification or indulgence shall, without the consent of the Guarantor,
increase the principal amount of such Security, or increase the interest rate
thereon, or change any redemption provisions thereof (including any change to
increase any premium payable upon redemption thereof), or change the Stated
Maturity thereof, or increase the principal amount of any Discount Security that
would be due and payable upon a declaration of acceleration or the maturity
thereof pursuant to Article Eight of this Indenture.

                                      -71-
<PAGE>   79

                The Guarantor hereby waives the benefits of diligence,
presentment, demand for payment, any requirement that the Trustee or any of the
Holders exhaust any right or take any action against the Company or any other
Person, filing of claims with a court in the event of insolvency or bankruptcy
of the Company, any right to require a proceeding first against the Company,
protest or notice with respect to any Security or the indebtedness evidenced
thereby and all demands whatsoever, and covenants that this Guarantee will not
be discharged in respect of any Security except by complete performance of the
obligations contained in such Security and in this Guarantee. This Guarantee
shall constitute a guaranty of payment and not of collection. The Guarantor
hereby agrees that, in the event of a default in payment of principal, or
premium, if any, or interest, if any, on any Security, whether at its Stated
Maturity, by declaration of acceleration, call for redemption, or otherwise,
legal proceedings may be instituted by the Trustee on behalf of, or by, the
Holder of such Security, subject to the terms and conditions set forth in this
Indenture, directly against the Guarantor to enforce this Guarantee without
first proceeding against the Company.

                The obligations of the Guarantor hereunder with respect to any
Security shall be continuing and irrevocable until the date upon which the
entire principal of, premium, if any, and interest on such Security has been, or
has been deemed pursuant to the provisions of Article Seven of this Indenture to
have been, paid in full or otherwise discharged.

                The Guarantor shall be subrogated to all rights of the Holders
of the Securities upon which its Guarantee is endorsed against the Company in
respect of any amounts paid by the Guarantor on account of such Securities
pursuant to the provisions of its Guarantee or this Indenture; provided,
however, that the Guarantor shall not be entitled to enforce or to receive any
payments arising out of, or based upon, such right of subrogation until the
principal of, and premium, if any, and interest, if any, on all Securities
issued hereunder shall have been paid in full.

                This Guarantee shall remain in full force and effect and
continue notwithstanding any petition filed by or against the Company for
liquidation or reorganization, the Company becoming insolvent or making an
assignment for the benefit of creditors or a receiver or trustee being appointed
for all or any significant part of the Company's assets, and shall, to the
fullest extent permitted by law, continue to be effective or reinstated, as the
case may be, if at any time payment of any Security, is, pursuant to applicable
law, rescinded or reduced in amount, or must otherwise be restored or returned
by any Holder of such Security, whether as a "voidable preference," "fraudulent
transfer," or otherwise, all as though such payment or performance had not been
made. In the event that any payment, or any part thereof, is rescinded, reduced,
restored or returned on a Security, such Security shall, to the fullest extent
permitted by law, be reinstated and deemed paid only by such amount paid and not
so rescinded, reduced, restored or returned.

SECTION 1402.       GUARANTEE SUBORDINATE TO SENIOR INDEBTEDNESS OF THE
                    GUARANTOR.

                The Guarantor, for itself, its successors and assigns, covenants
and agrees, and each Holder of the Securities of each series, by its acceptance
thereof, likewise covenants and agrees, that the payment under the Guarantee of
the principal of and premium, if any, and interest, if any, on each and all of
the Securities is hereby expressly subordinated and subject to

                                      -72-
<PAGE>   80

the extent and in the manner set forth in this Article, in right of payment to
the prior payment in full of all Senior Indebtedness of the Guarantor.

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

SECTION 1403.      PAYMENT OVER OF PROCEEDS OF SECURITIES.

                In the event (a) of any insolvency or bankruptcy proceedings or
any receivership, liquidation, reorganization or other similar proceedings in
respect of the Guarantor or a substantial part of its property, or of any
proceedings for liquidation, dissolution or other winding up of the Guarantor,
whether or not involving insolvency or bankruptcy, or (b) subject to the
provisions of Section 1404, that (i) a default shall have occurred with respect
to the payment of principal of or interest on or other monetary amounts due and
payable on any Senior Indebtedness of the Guarantor, or (ii) there shall have
occurred a default (other than a default in the payment of principal or interest
or other monetary amounts due and payable) in respect of any Senior Indebtedness
of the Guarantor, as defined therein or in the instrument under which the same
is outstanding, permitting the holder or holders thereof to accelerate the
maturity thereof (with notice or lapse of time, or both), and such default shall
have continued beyond the period of grace, if any, in respect thereof, and, in
the cases of subclauses (i) and (ii) of this clause (b), such default shall not
have been cured or waived or shall not have ceased to exist, or (c) that the
principal of and accrued interest on the Securities of any series shall have
been declared due and payable pursuant to Section 801 and such declaration shall
not have been rescinded and annulled as provided in Section 802, then:

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

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

                                      -73-
<PAGE>   81

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

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

                Notwithstanding the foregoing, at any time after the 123rd day
following the date of deposit of cash or Eligible Obligations pursuant to
Section 701 or 702 (provided all conditions set out in such Section shall have
been satisfied), the funds so deposited and any interest thereon will not be
subject to any rights of holders of Senior Indebtedness of the Guarantor
including, without limitation, those arising under this Article Fourteen;
provided that no event described in clauses (e) and (f) of Section 801 with
respect to the Guarantor has occurred during such 123-day period.

                For purposes of this Article only, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Guarantor as
reorganized or readjusted, or securities of the Guarantor or any other
corporation provided for by a plan or reorganization or readjustment which are
subordinate in right of payment to all Senior Indebtedness of the Guarantor
which may at the time be outstanding to the same extent as, or to a greater
extent than, the Guarantee of the Securities are so subordinated as provided in
this Article. The consolidation of the Guarantor with, or the merger of the
Guarantor into, another corporation or the liquidation or dissolution of the
Guarantor following the conveyance or transfer of its property as an entirety,
or substantially as an entirety, to another corporation upon the terms and
conditions provided for in Article Eleven hereof shall not be deemed a
dissolution, winding-up, liquidation or reorganization for the purposes of this
Section 1403 if such other corporation shall, as a part of such consolidation,
merger, conveyance or transfer, comply with the conditions stated in Article
Eleven hereof. Nothing in Section 1402 or in this Section 1403 shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 907.

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<PAGE>   82

SECTION 1404.         DISPUTES WITH HOLDERS OF CERTAIN SENIOR INDEBTEDNESS
                      OF THE GUARANTOR.

                Any failure by the Guarantor to make any payment on or perform
any other obligation in respect of Senior Indebtedness of the Guarantor, other
than any indebtedness incurred by the Guarantor or assumed or guaranteed,
directly or indirectly, by the Guarantor for money borrowed (or any deferral,
renewal, extension or refunding thereof) or any other obligation as to which the
provisions of this Section shall have been waived by the Guarantor in the
instrument or instruments by which the Guarantor incurred, assumed, guaranteed
or otherwise created such indebtedness or obligation, shall not be deemed a
default under clause (b) of Section 1403 if (i) the Guarantor shall be disputing
its obligation to make such payment or perform such obligation and (ii) either
(A) no final judgment relating to such dispute shall have been issued against
the Guarantor which is in full force and effect and is not subject to further
review, including a judgment that has become final by reason of the expiration
of the time within which a party may seek further appeal or review, or (B) in
the event that a judgment that is subject to further review or appeal has been
issued, the Guarantor shall in good faith be prosecuting an appeal or other
proceeding for review and a stay or execution shall have been obtained pending
such appeal or review.

SECTION 1405.         SUBROGATION.

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

SECTION 1406.         OBLIGATION OF THE GUARANTOR UNCONDITIONAL.

                Nothing contained in this Article or elsewhere in this Indenture
or in the Guarantee is intended to or shall impair, as among the Guarantor, its
creditors other than the holders of Senior Indebtedness of the Guarantor and the
Holders, the obligation of the Guarantor, which is absolute and unconditional,
to pay to the Holders, pursuant to the terms of the Guarantee, the principal of
and interest on the Securities as and when the same shall become due and payable
in accordance with their terms, or is intended to or shall affect the relative
rights of the Holders and creditors of the Guarantor other than the holders of
Senior Indebtedness of the

                                      -75-
<PAGE>   83

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

                Upon any payment or distribution of assets or securities of the
Guarantor referred to in this Article, the Trustee and the Holders shall be
entitled to rely upon any order or decree of a court of competent jurisdiction
in which such dissolution, winding up, liquidation or reorganization proceedings
are pending for the purpose of ascertaining the Persons entitled to participate
in such distribution, the holders of the Senior Indebtedness of the Guarantor
and other indebtedness of the Guarantor, the amount thereof or payable thereon,
the amount or amounts paid or distributed thereon, and all other facts pertinent
thereto or to this Article.

                The Trustee shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself to be a holder of Senior
Indebtedness of the Guarantor (or a representative of such holder or a trustee
under any indenture under which any instruments evidencing any such Senior
Indebtedness of the Guarantor may have been issued) to establish that such
notice has been given by a holder of such Senior Indebtedness of the Guarantor
or such representative or trustee on behalf of such holder. In the event that
the Trustee determines in good faith that further evidence is required with
respect to the right of any Person as a holder of Senior Indebtedness of the
Guarantor to participate in any payment or distribution pursuant to this
Article, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
of the Guarantor held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the right of such Person under this Article, and, if such evidence
is not furnished, the Trustee may defer any payment to such Person pending
judicial determination as to the right of such Person to receive such payment or
distribution.

SECTION 1407.        PRIORITY OF SENIOR INDEBTEDNESS OF THE GUARANTOR UPON
                     MATURITY.

                Upon the maturity of the principal of any Senior Indebtedness of
the Guarantor by lapse of time, acceleration or otherwise, all matured principal
of Senior Indebtedness of the Guarantor and interest and premium, if any,
thereon shall first be paid in full before any payment of principal or premium,
if any, or interest, if any, is made upon the Securities under the Guarantee.

SECTION 1408.        TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS OF THE GUARANTOR.

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

SECTION 1409.        NOTICE TO TRUSTEE TO EFFECTUATE SUBORDINATION.

                Notwithstanding the provisions of this Article or any other
provision of the Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts which

                                      -76-
<PAGE>   84

would prohibit the making of any payment of moneys to or by the Trustee unless
and until the Trustee shall have received written notice thereof from the
Guarantor, from a Holder or from a holder of any Senior Indebtedness of the
Guarantor or from any representative or representatives of such holder or any
trustee or trustees under any indenture under which any instruments evidencing
any such Senior Indebtedness of the Guarantor may have been issued and, prior to
the receipt of any such written notice, the Trustee shall be entitled, subject
to Section 901, in all respects to assume that no such facts exist; provided,
however, that, if prior to the fifth Business Day preceding the date upon which
by the terms hereof any such moneys may become payable for any purpose, or in
the event of the execution of an instrument pursuant to Section 701 or 702
acknowledging that Securities or portions thereof are deemed to have been paid
for all purposes of this Indenture, acknowledging that the entire indebtedness
of the Company in respect thereof has been satisfied and discharged or
acknowledging satisfaction and discharge of this Indenture, then if prior to the
second Business Day preceding the date of such execution, the Trustee shall not
have received with respect to such moneys the notice provided for in this
Section, then, anything herein contained to the contrary notwithstanding, the
Trustee may, in its discretion, receive such moneys and/or apply the same to the
purpose for which they were received, and shall not be affected by any notice to
the contrary, which may be received by it on or after such date; provided,
however, that no such application shall affect the obligations under this
Article of the Persons receiving such moneys from the Trustee.

SECTION 1410.        MODIFICATION, EXTENSION, ETC. OF SENIOR INDEBTEDNESS OF
                     THE GUARANTOR.

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

SECTION 1411.        TRUSTEE HAS NO FIDUCIARY DUTY TO HOLDERS OF SENIOR
                     INDEBTEDNESS OF THE GUARANTOR.

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

                                      -77-
<PAGE>   85

SECTION 1412.        PAYING AGENTS OTHER THAN THE TRUSTEE.

                In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Guarantor and be then acting hereunder, the
term "Trustee" as used in this Article shall in such case (unless the context
shall otherwise require) be construed as extending to and including such Paying
Agent within its meaning as fully for all intents and purposes as if such Paying
Agent were named in this Article in addition to or in place of the Trustee;
provided, however, that Sections 1408, 1409 and 1411 shall not apply to the
Guarantor if it acts as Paying Agent.

SECTION 1413.        RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS OF THE
                     GUARANTOR NOT IMPAIRED.

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

SECTION 1414.        EFFECT OF SUBORDINATION PROVISIONS; TERMINATION.

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

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

SECTION 1415.        EXECUTION AND DELIVERY OF GUARANTEE.

                The Guarantee to be endorsed on the Securities of each series
shall include the terms of the Guarantee set forth in this Article Fourteen and
any other terms that may be set forth as established pursuant to Section 301.
The Guarantor hereby agrees to execute its Guarantee, in a form established
pursuant to Section 201, to be endorsed on each Security authenticated and
delivered by the Trustee.

                The Guarantee shall be executed on behalf of the Guarantor by an
Authorized Officer of the Guarantor. The signature of any such officer on the
Guarantee may be manual or facsimile.

                A Guarantee bearing the manual or facsimile signature of an
individual who was at the time of execution an Authorized Officer of the
Guarantor shall bind the Guarantor, notwithstanding that any such individual has
ceased to be an Authorized Officer prior to the

                                      -78-
<PAGE>   86

authentication and delivery of the Security on which such Guarantee is endorsed
or was not an Authorized Officer at the date of such Guarantee.

                The delivery of any Security by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the Guarantee
endorsed thereon on behalf of the Guarantor. The Guarantor hereby agrees that
its Guarantee set forth in this Article Fourteen shall remain in full force and
effect notwithstanding any failure to endorse a Guarantee on any Security. The
Guarantor by its execution of this Indenture hereby authorizes the Company, in
the name and on behalf of the Guarantor, to confirm the applicable Guarantee to
the Holder of each Security authenticated and delivered hereunder by its
execution and delivery of each such Security, with such Guarantee endorsed
thereon, authenticated and delivered by the Trustee.

                                ARTICLE FIFTEEN

                           SUBORDINATION OF SECURITIES

SECTION 1501.        SECURITIES SUBORDINATE TO SENIOR INDEBTEDNESS OF THE
                     COMPANY.

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

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

SECTION 1502.         PAYMENT OVER OF PROCEEDS OF SECURITIES.

                In the event (a) of any insolvency or bankruptcy proceedings or
any receivership, liquidation, reorganization or other similar proceedings in
respect of the Company or a substantial part of its property, or of any
proceedings for liquidation, dissolution or other winding up of the Company,
whether or not involving insolvency or bankruptcy, or (b) subject to the
provisions of Section 1503, that (i) a default shall have occurred with respect
to the payment of principal of or interest on or other monetary amounts due and
payable on any Senior Indebtedness of the Company, or (ii) there shall have
occurred a default (other than a default in the payment of principal or interest
or other monetary amounts due and payable) in respect of any Senior Indebtedness
of the Company, as defined therein or in the instrument under which the same is
outstanding, permitting the holder or holders thereof to accelerate the maturity
thereof (with notice or lapse of time, or both), and such default shall have
continued beyond the period of grace, if any, in respect thereof, and, in the
cases of subclauses (i) and (ii) of this clause (b), such default shall not have
been cured or waived or shall not have ceased to exist, or (c) that the
principal of and accrued interest on the Securities of any series shall have
been declared due and

                                      -79-
<PAGE>   87

payable pursuant to Section 801 and such declaration shall not have been
rescinded and annulled as provided in Section 802, then:

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

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

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

                Notwithstanding the foregoing, at any time after the 123rd day
following the date of deposit of cash or Eligible Obligations pursuant to
Section 701 or 702 (provided all conditions set out in such Section shall have
been satisfied), the funds so deposited and any interest thereon

                                      -80-
<PAGE>   88

will not be subject to any rights of holders of Senior Indebtedness of the
Company including, without limitation, those arising under this Article Fifteen;
provided that no event described in clauses (e) and (f) of Section 801 with
respect to the Company has occurred during such 123-day period.

                For purposes of this Article only, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan or reorganization or readjustment which are subordinate
in right of payment to all Senior Indebtedness of the Company which may at the
time be outstanding to the same extent as, or to a greater extent than, the
Securities are so subordinated as provided in this Article. The consolidation of
the Company with, or the merger of the Company into, another corporation or the
liquidation or dissolution of the Company following the conveyance or transfer
of its property as an entirety, or substantially as an entirety, to another
corporation upon the terms and conditions provided for in Article Eleven hereof
shall not be deemed a dissolution, winding-up, liquidation or reorganization for
the purposes of this Section 1502 if such other corporation shall, as a part of
such consolidation, merger, conveyance or transfer, comply with the conditions
stated in Article Eleven hereof. Nothing in Section 1501 or in this Section 1502
shall apply to claims of, or payments to, the Trustee under or pursuant to
Section 907.

SECTION 1503.        DISPUTES WITH HOLDERS OF CERTAIN SENIOR INDEBTEDNESS OF
                     THE COMPANY.

                Any failure by the Company to make any payment on or perform any
other obligation in respect of Senior Indebtedness of the Company, other than
any indebtedness incurred by the Company or assumed or guaranteed, directly or
indirectly, by the Company for money borrowed (or any deferral, renewal,
extension or refunding thereof) or any other obligation as to which the
provisions of this Section shall have been waived by the Company in the
instrument or instruments by which the Company incurred, assumed, guaranteed or
otherwise created such indebtedness or obligation, shall not be deemed a default
under clause (b) of Section 1502 if (i) the Company shall be disputing its
obligation to make such payment or perform such obligation and (ii) either (A)
no final judgment relating to such dispute shall have been issued against the
Company which is in full force and effect and is not subject to further review,
including a judgment that has become final by reason of the expiration of the
time within which a party may seek further appeal or review, or (B) in the event
that a judgment that is subject to further review or appeal has been issued, the
Company shall in good faith be prosecuting an appeal or other proceeding for
review and a stay or execution shall have been obtained pending such appeal or
review.

SECTION 1504.        SUBROGATION.

                Senior Indebtedness of the Company shall not be deemed to have
been paid in full unless the holders thereof shall have received cash (or
securities or other property satisfactory to such holders) in full payment of
such Senior Indebtedness of the Company then outstanding. Upon the payment in
full of all Senior Indebtedness of the Company, the rights of the Holders of the
Securities shall be subrogated to the rights of the holders of Senior
Indebtedness of the Company to receive any further payments or distributions of
cash, property or securities of the

                                      -81-
<PAGE>   89

Company applicable to the holders of the Senior Indebtedness of the Company
until all amounts owing on the Securities shall be paid in full; and such
payments or distributions of cash, property or securities received by the
Holders of the Securities, by reason of such subrogation, which otherwise would
be paid or distributed to the holders of such Senior Indebtedness of the Company
shall, as between the Company, its creditors other than the holders of Senior
Indebtedness of the Company, and the Holders, be deemed to be a payment by the
Company to or on account of Senior Indebtedness of the Company, it being
understood that the provisions of this Article are and are intended solely for
the purpose of defining the relative rights of the Holders, on the one hand, and
the holders of the Senior Indebtedness of the Company, on the other hand.

SECTION 1505.        OBLIGATION OF THE COMPANY UNCONDITIONAL.

                Nothing contained in this Article or elsewhere in this Indenture
or in the Securities is intended to or shall impair, as among the Company, its
creditors other than the holders of Senior Indebtedness of the Company and the
Holders, the obligation of the Company, which is absolute and unconditional, to
pay to the Holders the principal of and interest on the Securities as and when
the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders and creditors of
the Company other than the holders of Senior Indebtedness of the Company, nor
shall anything herein or therein prevent the Trustee or any Holder from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, under this Article of the holders
of Senior Indebtedness of the Company in respect of cash, property or securities
of the Company received upon the exercise of any such remedy.

                Upon any payment or distribution of assets or securities of the
Company referred to in this Article, the Trustee and the Holders shall be
entitled to rely upon any order or decree of a court of competent jurisdiction
in which such dissolution, winding up, liquidation or reorganization proceedings
are pending for the purpose of ascertaining the Persons entitled to participate
in such distribution, the holders of the Senior Indebtedness of the Company and
other indebtedness of the Company, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon, and all other facts pertinent
thereto or to this Article.

                The Trustee shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself to be a holder of Senior
Indebtedness of the Company (or a representative of such holder or a trustee
under any indenture under which any instruments evidencing any such Senior
Indebtedness of the Company may have been issued) to establish that such notice
has been given by a holder of such Senior Indebtedness of the Company or such
representative or trustee on behalf of such holder. In the event that the
Trustee determines in good faith that further evidence is required with respect
to the right of any Person as a holder of Senior Indebtedness of the Company to
participate in any payment or distribution pursuant to this Article, the Trustee
may request such Person to furnish evidence to the reasonable satisfaction of
the Trustee as to the amount of Senior Indebtedness of the Company held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the right of such
Person under this Article, and, if such evidence is not furnished, the Trustee
may defer any payment to such Person pending judicial determination as to the
right of such Person to receive such payment or distribution.

                                      -82-
<PAGE>   90

SECTION 1506.         PRIORITY OF SENIOR INDEBTEDNESS OF THE COMPANY UPON
                      MATURITY.

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

SECTION 1507.         TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS OF THE COMPANY.

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

SECTION 1508.         NOTICE TO TRUSTEE TO EFFECTUATE SUBORDINATION.

                Notwithstanding the provisions of this Article or any other
provision of the Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts which would prohibit the making of any payment of
moneys to or by the Trustee unless and until the Trustee shall have received
written notice thereof from the Company, from a Holder or from a holder of any
Senior Indebtedness of the Company or from any representative or representatives
of such holder or any trustee or trustees under any indenture under which any
instruments evidencing any such Senior Indebtedness of the Company may have been
issued and, prior to the receipt of any such written notice, the Trustee shall
be entitled, subject to Section 901, in all respects to assume that no such
facts exist; provided, however, that, if prior to the fifth Business Day
preceding the date upon which by the terms hereof any such moneys may become
payable for any purpose, or in the event of the execution of an instrument
pursuant to Section 701 or 702 acknowledging that Securities or portions thereof
are deemed to have been paid for all purposes of this Indenture, acknowledging
that the entire indebtedness of the Company in respect thereof has been
satisfied and discharged or acknowledging satisfaction and discharge of this
Indenture, then if prior to the second Business Day preceding the date of such
execution, the Trustee shall not have received with respect to such moneys the
notice provided for in this Section, then, anything herein contained to the
contrary notwithstanding, the Trustee may, in its discretion, receive such
moneys and/or apply the same to the purpose for which they were received, and
shall not be affected by any notice to the contrary, which may be received by it
on or after such date; provided, however, that no such application shall affect
the obligations under this Article of the persons receiving such moneys from the
Trustee.

SECTION 1509.         MODIFICATION, EXTENSION, ETC. OF SENIOR INDEBTEDNESS OF
                      THE COMPANY.

                The holders of Senior Indebtedness of the Company may, without
affecting in any manner the subordination of the payment of the principal of and
premium, if any, and interest, if any, on the Securities, at any time or from
time to time and in their absolute discretion, agree with the Company to change
the manner, place or terms of payment, change or extend the time

                                      -83-
<PAGE>   91

of payment of, or renew or alter, any Senior Indebtedness of the Company, or
amend or supplement any instrument pursuant to which any Senior Indebtedness of
the Company is issued, or exercise or refrain from exercising any other of their
rights under the Senior Indebtedness of the Company including, without
limitation, the waiver of default thereunder, all without notice to or assent
from the Holders or the Trustee.

SECTION 1510.          TRUSTEE HAS NO FIDUCIARY DUTY TO HOLDERS OF SENIOR
                       INDEBTEDNESS OF THE COMPANY.

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

SECTION 1511.          PAYING AGENTS OTHER THAN THE TRUSTEE.

                In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article shall in such case (unless the context shall
otherwise require) be construed as extending to and including such Paying Agent
within its meaning as fully for all intents and purposes as if such Paying Agent
were named in this Article in addition to or in place of the Trustee; provided,
however, that Sections 1507, 1508 and 1510 shall not apply to the Company if it
acts as Paying Agent.

SECTION 1512.          RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS OF THE
                       COMPANY NOT IMPAIRED.

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

SECTION 1513.  .      EFFECT OF SUBORDINATION PROVISIONS; TERMINATION.

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

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

                                      -84-
<PAGE>   92

                                 ARTICLE SIXTEEN

         IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS

SECTION 1601.          LIABILITY SOLELY CORPORATE.

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

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

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

                                      -85-
<PAGE>   93

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

                               PPL CAPITAL FUNDING, INC.

                               By:      /s/  James E. Abel
                                     -------------------------------------
                                      Name: James E. Abel
                                      Title:   Treasurer

                               PPL CORPORATION

                               By:      /s/  James E. Abel
                                     -------------------------------------
                                      Name: James E. Abel
                                      Title:   Vice-President - Finance and
                                      Treasurer

                               THE CHASE MANHATTAN BANK,
                                  as Trustee

                               By:       /s/   Annette M. Marsula
                                     -------------------------------------
                                      Name: Annette M. Marsula
                                      Title:   Vice President

                                      -86-<PAGE>   1
                                                                [EXECUTION COPY]

                                                                     EXHIBIT 4.2

                           PPL CAPITAL FUNDING, INC.,
                                     ISSUER

                                       AND

                                PPL CORPORATION,
                                    GUARANTOR

                                       TO

                            THE CHASE MANHATTAN BANK,
                                     TRUSTEE

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

                        7.29% SUBORDINATED NOTES DUE 2006

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

                          SUPPLEMENTAL INDENTURE NO. 1

                             DATED AS OF MAY 9, 2001

                   SUPPLEMENTAL TO THE SUBORDINATED INDENTURE

                             DATED AS OF MAY 9, 2001

              ESTABLISHING A SERIES OF SECURITIES DESIGNATED 7.29%
                SUBORDINATED NOTES LIMITED IN AGGREGATE PRINCIPAL
                             AMOUNT TO $592,783,506

<PAGE>   2

               SUPPLEMENTAL INDENTURE NO. 1, dated as of May 9, 2001 among PPL
CAPITAL FUNDING, INC., a corporation duly organized and existing under the laws
of the State of Delaware (herein called the "Company" or the "Issuer"), PPL
CORPORATION, a corporation duly organized and existing under the laws of the
Commonwealth of Pennsylvania (herein called the "Guarantor"), and THE CHASE
MANHATTAN BANK, a New York banking corporation, as Trustee (herein called the
"Trustee"), under the Subordinated Indenture dated as of May 9, 2001
(hereinafter called the "Original Indenture"), this Supplemental Indenture No. 1
being supplemental thereto. The Original Indenture and any and all indentures
and instruments supplemental thereto are hereinafter sometimes collectively
called the "Indenture."

                    RECITALS OF THE COMPANY AND THE GUARANTOR

               The Original Indenture was authorized, executed and delivered by
the Company and the Guarantor to provide for the issuance by the Company from
time to time of certain of its subordinated debt securities (the "Securities")
(such term and all other capitalized terms used herein without definition having
the meanings assigned to them in the Original Indenture), to be issued in one or
more series as contemplated therein, and for the Guarantee by the Guarantor of
the payment of the principal, premium, if any, and interest, if any, on such
Securities.

               As contemplated by Sections 301 and 1201(f) of the Original
Indenture, the Company wishes to establish a series of Securities to be
designated "7.29% Subordinated Notes due 2006" to be limited in aggregate
principal amount (except as contemplated in Section 301(b) of the Original
Indenture) to $592,783,506, such series of Securities to be hereinafter
sometimes called "Securities of Series No. 1."

               As contemplated by Section 201 and 1415 of the Original
Indenture, the Guarantor wishes to establish the form and terms of the
Guarantees to be endorsed on the Securities of Series No. 1. The Company and the
Guarantor wish to issue the Securities of Series No. 1 to PPL Capital Funding
Trust I (the "Trust") in exchange for the undivided preferred beneficial
ownership interests in the Assets of the Trust (the "Preferred Securities") and
common beneficial ownership interests in the assets of the Trust to be issued to
the Guarantor ("Common Securities" together with the Preferred Securities, the
"Trust Securities").

               The Company has duly authorized the execution and delivery of
this Supplemental Indenture No. 1 to establish the Securities of Series No. 1
and has duly authorized the issuance of such Securities; the Guarantor has duly
authorized the execution and delivery of this Supplemental Indenture No. 1 and
has duly authorized its Guarantees of the Securities of Series No. 1; and all
acts necessary to make this Supplemental Indenture No. 1 a valid agreement of
the Company and the Guarantor, to make the Securities of Series No. 1 valid
obligations of the Company, and to make the Guarantees valid obligations of the
Guarantor, have been performed.

               NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE NO. 1 WITNESSETH:

<PAGE>   3
               For and in consideration of the premises and of the purchase of
the Securities by the Holders thereof, it is mutually covenanted and agreed, for
the equal and proportionate benefit of all Holders of the Securities of Series
No. 1, as follows:

                                   ARTICLE ONE

                                   DEFINITIONS

              SECTION 1.     Unless the context otherwise requires:

              (A)    a term not defined herein that is defined in the Original
       Indenture has the same meaning when used in this Supplemental Indenture
       No. 1;

              (B)    a term defined anywhere in this Supplemental Indenture No.
       1 has the same meaning throughout;

              (C)    a reference to a Section or Article is to a Section or
       Article of this Supplemental Indenture No. 1;

              (D)    the following terms have the meanings given to them in the
       Trust Agreement: (i) Common Trust Securities; (ii) Delaware Trustee;
       (iii) Liquidation Amount; (iv) Preferred Trust Securities; (v) Preferred
       Trust Securities Certificate; (vi) Property Trustee; (vii) Tax Event;
       (viii) Tax Event Redemption;

              (E)    the following terms have the meanings given to them in the
       Purchase Contract Agreement: (i) Additional Remarketing (ii) Authorized
       Newspaper; (iii) Cash Settlement; (iv) Depositary; (v) Failed Final
       Remarketing; (vi) Final Remarketing; (vii) Final Remarketing Date; (viii)
       Global Certificate; (ix) Initial Remarketing Date; (x) PEPS Units; (xi)
       Purchase Contract; (xii) Purchase Contract Settlement Date; (xiii)
       Quotation Agent; (xiv) Redemption Amount; (xv) Redemption Price; (xvi)
       Reset Effective Date; (xvii) Remarketing Agent; (xviii) Remarketing
       Agreement; (xix) Remarketing Date; (xx) Reset Announcement Date; (xxi)
       Reset Rate; (xxii) Treasury PEPS Unit; (xxiii) Successful Initial
       Remarketing (xxiv) Treasury Portfolio; (xxv) Benchmark Treasury and
       (xxvi) Two-Year Benchmark Treasury;

              (F)    the following terms have the meanings given to them in this
       Section 1:

                      "Business Day" means any day other than a Saturday or
               Sunday or a day on which banking institutions in the city of New
               York, New York are authorized or required by law or executive
               order to remain closed or a day on which the principal corporate
               trust office of the Trustee or the Property Trustee is closed for
               business.

                      "Coupon Rate" has the meaning specified in Article Two
               Section 5(B).

                      "Direct Action" has the meaning specified in Article Five
               Section 2.

                                       2
<PAGE>   4

                      "Global Subordinated Note" has the meaning specified in
               Article Two Section 4(A).

                      "Non Book-Entry Preferred Securities" has the meaning
               specified in Article Two Section 4(B).

                      "Purchase Contract Agreement" means the Purchase Contract
               Agreement dated as of May 9, 2001, between the Guarantor and The
               Chase Manhattan Bank, as Purchase Contract Agent.

                      "Remarketing" means the operation of the procedures for
               remarketing specified in Section 4.07 and Section 4.08 of the
               Trust Agreement and Sections 5.02 and 5.03 of the Purchase
               Contract Agreement.

                      "Remarketing Procedures" has the meaning set forth in the
               Remarketing Agreement.

                      "Trust Agreement" means the Amended and Restated Trust
               Agreement of the Trust, dated as of May 9, 2001, as amended and
               restated from time to time.

                                  ARTICLE TWO

                           FIRST SERIES OF SECURITIES

              SECTION 1. There is hereby created a series of Securities
designated "7.29% Subordinated Notes due 2006" and limited in aggregate
principal amount (except as contemplated in Section 301(b) of the Original
Indenture) equal to $592,783,506. The Securities of Series No. 1 shall be
executed, authenticated and delivered in accordance with the provisions of, and
shall in all respects be subject to, the terms, conditions and covenants of the
Original Indenture and this Supplemental Indenture No. 1 (including the form of
Subordinated Note set forth as Exhibits A and B hereto). The Securities of
Series No. 1 shall initially be issued in certificated form to the Trust (the
"Initial Securities of Series No. 1") and shall be substantially in the Form of
Exhibit B attached hereto. The terms of such Securities of Series No. 1 are
herein incorporated by reference and are part of the Supplemental Indenture No.
1.

              SECTION 2. The Company hereby agrees that, if the Company shall
       make any deposit of money and/or Eligible Obligations with respect to any
       Securities of Series No. 1, or any portion of the principal amount
       thereof, as contemplated by Section 701 of the Indenture, the Company
       shall not deliver an Officer's Certificate described in clause (z) in the
       first paragraph of said Section 701 unless the Company shall also deliver
       to the Trustee, together with such Officer's Certificate, either:

              (A)    an instrument wherein the Company, notwithstanding the
satisfaction and discharge of its indebtedness in respect of such Securities,
shall assume the obligation (which shall be absolute and unconditional) to
irrevocably deposit with the Trustee or Paying Agent such additional sums of
money, if any, or additional Eligible Obligations (meeting the requirements of
Section 701), if any, or any combination thereof, at such time or times, as
shall be necessary, together with the money and/or Eligible Obligations

                                       3
<PAGE>   5

       theretofore so deposited, to pay when due the principal of and premium,
       if any, and interest due and to become due on such Securities or
       portions thereof, all in accordance with and subject to the provisions
       of said Section 701; provided, however, that such instrument may state
       that the obligation of the Company to make additional deposits as
       aforesaid shall be subject to the delivery to the Company by the Trustee
       of a notice asserting the deficiency accompanied by an opinion of an
       independent public accountant of nationally recognized standing,
       selected by the Trustee, showing the calculation thereof (which opinion
       shall be obtained at the expense of the Company); or

              (B)    an Opinion of Counsel to the effect that the Holders of
       such Securities, or portions of the principal amount thereof, will not
       recognize income, gain or loss for United States federal income tax
       purposes as a result of the satisfaction and discharge of the Company's
       indebtedness in respect thereof and will be subject to United States
       federal income tax on the same amounts, at the same times and in the same
       manner as if such satisfaction and discharge had not been effected.

              SECTION 3. The entire principal amount of the Securities of Series
No. 1 will mature and become due and payable together with any accrued and
unpaid interest thereon, on May 18, 2006 (the "Maturity Date").

              SECTION 4. Upon a distribution of Trust Securities to holders in
connection with the involuntary or voluntary liquidation and dissolution of the
Trust:

              (A)    If the Trust Securities are held in book-entry form, the
       Initial Securities of Series No. 1 may be presented to the Trustee by the
       Property Trustee in exchange for a Global Security in the form of Exhibit
       A in an aggregate principal amount equal to all Outstanding Securities of
       Series No. 1 (a "Global Subordinated Note"). The Depositary for the
       Global Subordinated Note will be The Depository Trust Company. The Global
       Subordinated Note will be registered in the name of the Depositary or its
       nominee, Cede & Co., and delivered by the Trustee to the Depositary or a
       custodian appointed by the Depositary for crediting to the accounts of
       its participants pursuant to the instructions of the Property Trustee.
       The Company upon any such presentation shall execute a Global
       Subordinated Note in such aggregate principal amount and deliver the same
       to the Trustee for authentication and delivery in accordance with the
       Original Indenture and this Supplemental Indenture No. 1. Payments on the
       Securities of Series No. 1 issued as a Global Subordinated Note will be
       made to the Depositary or its nominee.

              (B)    If any Trust Securities are held in non book-entry
       certificated form ("Non Book-Entry Trust Securities"), the Initial
       Securities of Series No. 1 may be presented to the Trustee by the
       Property Trustee, and such Non Book-Entry Trust Securities will be deemed
       to represent beneficial interests in Securities of Series No. 1 presented
       to the Trustee by the Property Trustee having an aggregate principal
       amount equal to the aggregate liquidation amount of the Non Book-Entry
       Trust Securities until the Trust Security Certificates representing such
       Non Book-Entry Trust Securities are presented to the Security Registrar
       for transfer or reissuance, at which time such Trust Security
       Certificates will be canceled and a Subordinated Note in the form of
       Exhibit B registered in the name of the holder of the Trust Security
       Certificate or the transferee of the holder

                                       4
<PAGE>   6

       of such Trust Security Certificate, as the case may be, with an aggregate
       principal amount equal to the aggregate liquidation amount of the Trust
       Security Certificate canceled will be executed by the Company and
       delivered to the Trustee for authentication and delivery in accordance
       with the Original Indenture and this Supplemental Indenture No. 1. On
       issue of such Securities of Series No. 1, Securities of Series No. 1 with
       an equivalent aggregate principal amount that were presented by the
       Property Trustee to the Trustee will be deemed to have been canceled.

              SECTION 5. a) The Regular Record Dates for the payment of interest
on the Securities of Series No. 1 on any Interest Payment Date, shall be (i) as
long as the Securities of Series No. 1 are represented by a Global Subordinated
Note or the Initial Securities of Series No. 1, the Business Day preceding each
Interest Payment Date or (ii) if the Securities of Series No. 1 are issued
pursuant to Section 4(B) above, the fifteenth day (whether or not a Business
Day) prior to each Interest Payment Date (as defined below).

              (A)    Each Subordinated Note will bear interest initially at the
rate of 7.29% per annum (the "Coupon Rate") from the original date of issuance
through and including the day immediately preceding the Reset Effective Date or
the Purchase Contract Settlement Date, as applicable, and at the Reset Rate
thereafter until the principal thereof is paid or duly made available for
payment and shall bear interest, to the extent permitted by law, compounded
quarterly, on any overdue principal and premium, if any, and on any overdue
installment of interest at the Coupon Rate through and including the day
immediately preceding the Reset Effective Date and at the Reset Rate thereafter,
payable quarterly in arrears on February 18, May 18, August 18 and November 18
of each year (each, an "Interest Payment Date") commencing on August 18, 2001,
to the Person in whose name such Securities of Series No. 1, or any predecessor
Subordinated Note, is registered at the close of business on the first day of
the month in which the interest payment date falls for such interest
installment. At the option of the Company the interest payment may be made by
check. Original issue discount will accrue on the Subordinated Notes subject to
contingent debt payment rules.

              (B)    The interest rate on the Securities of Series No. 1 will be
reset on the Initial Remarketing Date to the applicable Reset Rate (which Reset
Rate will be effective on and after the Reset Effective Date). In the event of a
Failed Final Remarketing, the interest rate on the Securities of Series No. 1
will be reset on the Final Remarketing Date to the applicable Reset Rate (which
Reset Rate will be effective on and after the Purchase Contract Settlement
Date). On the applicable Reset Announcement Date, the applicable Reset Spread
and the Two-Year Benchmark Treasury or Benchmark Treasury, as applicable, will
be announced by the Guarantor, such announcement to be made by a customary
method, as determined by the Guarantor. On the Business Day immediately
following such Reset Announcement Date, the Holders of Securities of Series No.
1 will be notified of such Reset Spread and Two-Year Benchmark Treasury or
Benchmark Treasury, as applicable, by the Guarantor. Such notice shall be
sufficiently given to such Holders of Securities of Series No. 1 if published in
an Authorized Newspaper.

              (C)    In the case of (a) the first Initial Remarketing on the
third Business Day prior to February 18, 2004 or the Final Remarketing, not
later than seven calendar days nor more than 15 calendar days immediately
preceding the applicable Reset Announcement Date, and in the case of (b) any
Additional Remarketing, as soon as practical after the Company has been

                                       5
<PAGE>   7

notified of an Additional Remarketing by the Remarketing Agent, the Guarantor
will request that the Depositary or its nominee (or any successor depositary or
its nominee) notify the Holders of Securities of Series No. 1 of such Reset
Announcement Date and, in the case of a Final Remarketing, the procedures to be
followed by such holders of Securities of Series No. 1 wishing to settle the
related Purchase Contracts with separate cash on the fourth Business Day
immediately preceding the Purchase Contract Settlement Date.

              (D)    The amount of interest payable on the Securities of Series
No. 1 for any period will be computed (i) for any full quarterly period on the
basis of a 360-day year of twelve 30-day months and (ii) for any period shorter
than a full quarterly period, on the basis of a 30-day month and, for any period
less than a month, on the basis of the actual number of days elapsed per 30-day
month. In the event that any date on which interest is payable on the Securities
of Series No. 1 is not a Business Day, then payment of the interest payable on
such date will be made on the next day that is a Business Day (and without
interest or other payment in respect of any such delay), except that, if such
Business Day is in the next calendar year, then such payment will be made on the
preceding Business Day.

              SECTION 6. If a Tax Event occurs and is continuing, the Company
may, at its option and upon not less than 30 nor more than 60 days' notice to
the Holders of the Securities of Series No. 1, redeem the Securities of Series
No. 1 in whole (but not in part) within 90 days following the occurrence of such
Tax Event, at a price equal to, for each Subordinated Note, the Redemption
Price. The aggregate Redemption Price shall be paid prior to 12:00 noon, New
York City time, on the date of redemption (the "Tax Event Redemption Date") or
such earlier time as the Company determines, provided that the Company shall
have deposited with the Trustee an amount sufficient to pay the aggregate
Redemption Price by 10:00 a.m. on the Tax Event Redemption Date. Such redemption
shall otherwise be in accordance with the provisions of Article IV of the
Original Indenture.

              Except as provided in this Section 6, the Company will have no
right to redeem the Securities of Series No. 1.

              The Securities of Series No. 1 will not be subject to a sinking
fund provision.

              SECTION 7. So long as the Securities of Series No. 1 are held by
the Trust, it shall be an Event of Default with respect to the Securities of
Series No. 1 if the Trust shall have voluntarily or involuntarily dissolved,
wound up its business or otherwise terminated its existence except in connection
with (i) the distribution of the Securities of Series No. 1 held by the Trust to
the holders of the Preferred Securities and Common Securities in liquidation of
their interests in the Trust, (ii) the redemption of all of the outstanding
Preferred Securities and Common Securities or (iii) a consolidation, conversion,
amalgamation, merger or other transaction involving the Trust that is permitted
under Section 3.15 of the Trust Agreement.

              SECTION 8. If the Securities of Series No. 1 are issued in
certificated form, the Paying Agent and the Security Registrar for the
Securities of Series No. 1 shall be the Property Trustee.

                                       6
<PAGE>   8

              SECTION 9. The Place of Payment will be initially the principal
corporate trust office of the Trustee which at the date hereof is located at 450
West 33rd Street, New York, New York 10001, Attention: Institutional Trust
Services.

              SECTION 10. Agreed Tax Treatment. Each Security issued hereunder
shall provide that each of the Company and, by its acceptance of a Security or a
beneficial interest therein, the Holder of, and any Person that acquires a
beneficial interest in, such Security (i) intends that such Security constitutes
indebtedness and agrees to treat such Security as indebtedness for United States
federal, local and state tax purposes , (ii) agrees to treat such Security as
indebtedness subject to Trea. Reg. Section 1.1275-4 (the "Contingent Debt
Regulations") and to be bound by the Company's determination of the "comparable
yield" and "projected payment schedule", within the meaning of the Contingent
Debt Regulations, with respect to such Security. For purposes of the foregoing,
the Company's determination of the "comparable yield" is 7.61% per annum,
compounded quarterly, and the Company's determination of the "projected payment
schedule" is $0.5012 for the period ending on August 18, 2001, $0.4556 for each
quarter ending on or prior to the date that is three Business Days following a
Successful Initial Remarketing and $0.4875 for each quarter ending after such
date which includes the final interest payment. A Holder may also obtain the
comparable yield and projected payment schedule by submitting a written request
for it to the Company at the following address: Two North Ninth Street,
Allentown, PA 18101.

                                 ARTICLE THREE

                                FORM OF GUARANTEE

              Guarantees to be endorsed on the Securities of Series No. 1 shall
be in substantially the form set forth below:

                               [FORM OF GUARANTEE]

                     PPL Corporation, a corporation organized under the laws of
       the Commonwealth of Pennsylvania (the "Guarantor", which term includes
       any successor under the Indenture (the "Indenture") referred to in the
       Security upon which this Guarantee is endorsed), for value received,
       hereby unconditionally guarantees to the Holder of the Security upon
       which this Guarantee is endorsed, the due and punctual payment of the
       principal of, and premium, if any, and interest, if any, on such Security
       when and as the same shall become due and payable, whether at the Stated
       Maturity, by declaration of acceleration, call for redemption, or
       otherwise, in accordance with the terms of such Security and of the
       Indenture. In case of the failure of PPL Capital Funding, Inc., a
       corporation organized under the laws of the State of Delaware (the
       "Company", which term includes any successor under the Indenture),
       punctually to make any such payment, the Guarantor hereby agrees to cause
       such payment to be made punctually when and as the same shall become due
       and payable, whether at the Stated Maturity or by declaration of
       acceleration, call for redemption or otherwise, and as if such payment
       were made by the Company.

                                       7
<PAGE>   9

                      The Guarantor hereby agrees that its obligations hereunder
        shall be absolute and unconditional irrespective of, and shall be
        unaffected by, any invalidity, irregularity or unenforceability of such
        Security or the Indenture, any failure to enforce the provisions of such
        Security or the Indenture, or any waiver, modification or indulgence
        granted to the Company with respect thereto, by the Holder of such
        Security or the Trustee or any other circumstance which may otherwise
        constitute a legal or equitable discharge or defense of a surety or
        guarantor; provided, however, that notwithstanding the foregoing, no
        such waiver, modification or indulgence shall, without the consent of
        the Guarantor, increase the principal amount of such Security, or
        increase the interest rate thereon, or change any redemption provisions
        thereof (including any change to increase any premium payable upon
        redemption thereof) or change the Stated Maturity thereof.

                      The Guarantor hereby waives the benefits of diligence,
        presentment, demand for payment, any requirement that the Trustee or the
        Holder of such Security exhaust any right or take any action against the
        Company or any other Person, filing of claims with a court in the event
        of insolvency or bankruptcy of the Company, any right to require a
        proceeding first against the Company, protest or notice with respect to
        such Security or the indebtedness evidenced thereby and all demands
        whatsoever, and covenants that this Guarantee will not be discharged in
        respect of such Security except by complete performance of the
        obligations contained in such Security and in this Guarantee. This
        Guarantee shall constitute a guaranty of payment and not of collection.
        The Guarantor hereby agrees that, in the event of a default in payment
        of principal, or premium, if any, or interest, if any, on such Security,
        whether at its Stated Maturity, by declaration of acceleration, call for
        redemption, or otherwise, legal proceedings may be instituted by the
        Trustee on behalf of, or by, the Holder of such Security, subject to the
        terms and conditions set forth in the Indenture, directly against the
        Guarantor to enforce this Guarantee without first proceeding against the
        Company.

                      The obligations of the Guarantor hereunder with respect to
        such Security shall be continuing and irrevocable until the date upon
        which the entire principal of, premium, if any, and interest, if any, on
        such Security has been, or has been deemed pursuant to the provisions of
        Article Seven of the Indenture to have been, paid in full or otherwise
        discharged.

                      The obligations evidenced by this Guarantee are, to the
        extent provided in the Indenture, subordinated and subject in right of
        payment to the prior payment in full of all Senior Indebtedness (as
        defined in the Indenture) of the Guarantor, and this Guarantee is issued
        subject to the provisions of the Indenture with respect thereto. Each
        Holder of a Security upon which this Guarantee is endorsed, by accepting
        the same, (a) agrees to and shall be bound by such provisions, (b)
        authorizes and directs the Trustee on his behalf to take such action as
        may be necessary or appropriate to acknowledge or effectuate the
        subordination so provided and (c) appoints the Trustee his attorney-in
        fact for any and all such purposes. Each Holder hereof, by his
        acceptance hereof, hereby

                                       8
<PAGE>   10

       waives all notice of the acceptance of the subordination provisions
       contained herein and in the Indenture by each holder of Senior
       Indebtedness, whether now outstanding or hereafter incurred, and waives
       reliance by each such Holder upon said provisions.

                      The Guarantor shall be subrogated to all rights of the
        Holder of such Security upon which this Guarantee is endorsed against
        the Company in respect of any amounts paid by the Guarantor on account
        of such Security pursuant to the provisions of this Guarantee or the
        Indenture; provided, however, that the Guarantor shall not be entitled
        to enforce or to receive any payments arising out of, or based upon,
        such right of subrogation until the principal of, and premium, if any,
        and interest, if any, on all Securities issued under the Indenture shall
        have been paid in full.

                      This Guarantee shall remain in full force and effect and
        continue notwithstanding any petition filed by or against the Company
        for liquidation or reorganization, the Company becoming insolvent or
        making an assignment for the benefit of creditors or a receiver or
        trustee being appointed for all or any significant part of the Company's
        assets, and shall, to the fullest extent permitted by law, continue to
        be effective or reinstated, as the case may be, if at any time payment
        of the Security upon which this Guarantee is endorsed, is, pursuant to
        applicable law, rescinded or reduced in amount, or must otherwise be
        restored or returned by the Holder of such Security, whether as a
        "voidable preference," "fraudulent transfer," or otherwise, all as
        though such payment or performance had not been made. In the event that
        any payment, or any part thereof, is rescinded, reduced, restored or
        returned on such Security, such Security shall, to the fullest extent
        permitted by law, be reinstated and deemed paid only by such amount paid
        and not so rescinded, reduced, restored or returned.

                      This Guarantee shall not be valid or obligatory for any
        purpose until the certificate of authentication of the Security upon
        which this Guarantee is endorsed shall have been manually executed by or
        on behalf of the Trustee under the Indenture.

                      All terms used in this Guarantee which are defined in the
        Indenture shall have the meanings assigned to them in such Indenture.

                      This Guarantee shall be deemed to be a contract made under
        the laws of the State of New York, and for all purposes shall be
        governed by and construed in accordance with the laws of the State of
        New York.

                      IN WITNESS WHEREOF, the Guarantor has caused this
        Guarantee to be executed as of the date first written above.

                                                   PPL CORPORATION

                                                   By:

                                       9
<PAGE>   11

                                  [END OF FORM]

                                  ARTICLE FOUR

                       PAYMENT OF TRUST COSTS AND EXPENSES

                     SECTION 1. In connection with the offering, issuance of
       Securities of Series No. 1 to the Trust in exchange for the Preferred
       Securities and Common Securities and subsequent sale of the Preferred
       Securities by the Company, the Company, as borrower, hereby covenants to
       (a) pay to the Trust, and reimburse the Trust for, the full amount of any
       costs, expenses or liabilities of the Trust (other than obligations of
       the Trust to pay the Holders of any Preferred Securities or Common
       Securities) including, without limitation, any taxes, duties or other
       governmental charges of whatever nature (other than withholding taxes)
       imposed on the Trust by the United States or any taxing authority; and
       (b) be primarily liable for any indemnification obligations arising with
       respect to the Trust Agreement. Such payment obligation includes any such
       costs, expenses or liabilities of the Trust that are required by
       applicable law to be satisfied in connection with a termination of the
       Trust. The obligations of the Company to pay all debts, obligations,
       costs and expenses of the Trust (other than with respect to amounts owing
       under the Common Securities and the Preferred Securities) shall survive
       the satisfaction and discharge of the Indenture and the Trust Agreement.

                                  ARTICLE FIVE

                      RIGHTS OF HOLDERS OF TRUST SECURITIES

                     SECTION 1. Notwithstanding Section 807 of the Indenture, if
       the Property Trustee fails to enforce its rights under the Securities of
       Series No. 1 after a holder of Trust Securities has made a written
       request, the holder of Trust Securities may, to the fullest extent
       permitted by law, institute a legal proceeding directly against the
       Company or the Guarantor to enforce the Property Trustee's rights under
       the Indenture without first instituting any legal proceeding against the
       Property Trustee or any other Person.

                     SECTION 2. Notwithstanding any other provision of the
       Indenture, for as long as any Trust Securities remain outstanding, to the
       fullest extent permitted by law, if an Event of Default has occurred and
       is continuing and such event is attributable to the failure of the
       Company to pay interest or principal on the Securities of Series No. 1 on
       the date such interest or principal is otherwise payable (or in the case
       of redemption, the redemption date), then a holder of Trust Securities
       may institute a proceeding directly against the Company or the Guarantor
       (a "Direct Action") to enforce payment to such holder of the principal or
       interest on Securities of Series No. 1 having an aggregate principal
       amount equal to the aggregate liquidation amount of the Trust Securities
       of such holder.

                     SECTION 3. The Company will have the right to set off
       against its obligations to the Trust, as Holder of the Securities of
       Series No. 1, any payment made to a holder of Trust Securities in
       connection with a Direct Action.

                                       10
<PAGE>   12

                     SECTION 4. So long as any Trust Securities remain
       outstanding, (i) no amendment to the Indenture shall be made that
       adversely affects the holders of the Trust Securities in any material
       respect, and no termination of the Indenture shall occur, and no waiver
       of any Event of Default or compliance with any covenant under the
       Indenture shall be effective, without the prior consent of the holders of
       at least a majority in Liquidation Amount (as defined in the Trust
       Agreement) then outstanding unless and until the principal of (and
       premium, if any, on) the Securities of Series No. 1 and all accrued and
       unpaid interest thereon have been paid in full, and (ii) no amendment
       shall be made to this Article Five of this Supplemental Indenture No. 1
       that would impair the rights of the holders of the Trust Securities
       without the prior consent of the holders of each Trust Security then
       outstanding unless and until the principal of (and premium, if any, on)
       the Securities of Series No. 1 and all accrued and unpaid interest
       thereon have been paid in full.

                                 ARTICLE SIX

                                 REMARKETING

                     SECTION 1. Upon a distribution of the Securities of Series
       No. 1 upon the liquidation and dissolution of the Trust which occurs
       prior to the Remarketing of the Preferred Securities pursuant to the
       Trust Agreement, the Securities of Series No. 1 shall be Remarketed in
       accordance with the Remarketing Procedures of the Trust Agreement and the
       Purchase Contract Agreement where all references in the Remarketing
       Procedures to Preferred Securities shall be read as references to the
       Securities of Series No. 1, unless the context requires otherwise. Until
       such a distribution, or if such distribution occurs after the Remarketing
       of the Preferred Securities pursuant to the Trust Agreement, this Article
       Five will have no effect.

                                 ARTICLE SEVEN

                            ACCELERATION OF MATURITY

                     SECTION 1. Notwithstanding Section 802 of the Indenture, if
       an Event of Default with respect to the Securities of Series No. 1
       specified in clauses (e) or (f) of Section 801 of the Indenture occurs
       and is continuing, the principal of the Securities of Series No. 1 shall
       become due and payable immediately, without any declaration, notice or
       other act on the part of the Trustee or any holder thereof.

                                 ARTICLE EIGHT

                            MISCELLANEOUS PROVISIONS

                     SECTION 1. This Supplemental Indenture No. 1 is a
       supplement to the Original Indenture. As supplemented by this
       Supplemental Indenture No. 1, the Indenture is in all respects ratified,
       approved and confirmed, and the Original Indenture and this Supplemental
       Indenture No. 1 shall together constitute one and the same instrument.

                     SECTION 2. The recitals contained in this Supplemental
       Indenture No. 1 shall be taken as the statements of the Company and the
       Guarantor, and the Trustee assumes no

                                       11
<PAGE>   13

       responsibility for their correctness and makes no representation as to
       the validity or sufficiency of this Supplemental Indenture No. 1.

                     SECTION 3. This instrument may be executed in any number of
       counterparts, each of which so executed shall be deemed to be an
       original, but all such counterparts shall together constitute but one and
       the same instrument.

                                       12
<PAGE>   14

               IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture No. 1 to be duly executed, and their respective corporate
seals to be hereunto affixed and attested, all as of the day and year first
written above.

                                   PPL CAPITAL FUNDING, INC.

                                   By:  /s/ James E. Abel
                                        -------------------------------
                                        Name:  James E. Abel
                                        Title: Treasurer

                                   PPL CORPORATION

                                   By:  /s/ James E. Abel
                                        -------------------------------
                                        Name:   James E. Abel
                                        Title:  Vice-President - Finance
                                                 and Treasurer

                                   THE CHASE MANHATTAN BANK,
                                   as Trustee

                                   By:  /s/ Annette M.  Marsula
                                        -------------------------------
                                        Name:  Annette M. Marsula
                                        Title: Vice President

<PAGE>   15
                                                                       EXHIBIT A

                       [FORM OF FACE OF SUBORDINATED NOTE]

THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF A DEPOSITARY. THIS GLOBAL SECURITY IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES HEREINAFTER DESCRIBED AND MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY
OR BY THE DEPOSITARY OR ANY NOMINEE TO A SUCCESSOR OF THE DEPOSITARY OR A
NOMINEE OF SUCH SUCCESSOR.

REGISTERED                                                            REGISTERED

                            PPL CAPITAL FUNDING, INC.

                        7.29% SUBORDINATED NOTES DUE 2006

                                                                     $----------

               PPL CAPITAL FUNDING, INC., a corporation duly organized and
existing under the laws of Delaware (herein called the "Company", which term
includes any successor corporation under the Indenture hereinafter referred to),
for value received, hereby promises to pay to ____________, or registered
assigns, the principal sum of ________________ Dollars on May 18, 2006, and to
pay interest on said principal sum from May 9, 2001, or from the most recent
Interest Payment Date to which interest has been paid or duly provided for,
quarterly in arrears on February 18, May 18, August 18 and November 18 of each
year (an "Interest Payment Date") commencing August 18, 2001, initially at the
rate of 7.29% per annum through and including the day immediately preceding the
Reset Effective Date, and at the Reset Rate thereafter until the principal
hereof shall have been paid or duly made available for payment and, to the
extent permitted by law, to pay interest, compounded quarterly, on any overdue
principal and premium, if any, and on any overdue installment of interest at the
rate per annum of 7.29% through and including the day immediately preceding the
Reset Effective Date, and at the Reset Rate thereafter until May 18, 2006. The
amount of interest payable for any period will be

                                      A-1
<PAGE>   16

computed (1) for any full quarterly period on the basis of a 360-day year of
twelve 30-day months and (2) for any period shorter than a full quarterly
period, on the basis of a 30-day month and, for any period less than a month, on
the basis of the actual number of days elapsed per 30-day month. In the event
that any date on which interest is payable is not a Business Day, then payment
of the interest payable on such date will be made on the next day that is a
Business Day (and without any interest or other payment in respect of such
delay), except that, if such Business Day is in the next calendar year, then
such payment will be made on the preceding Business Day. The interest
installment so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in the Indenture, referred to on the
reverse side hereof, be paid to the Holder in whose name this Security (or one
or more Predecessor Securities, as defined in said Indenture) is registered at
the close of business on the Regular Record Date for such interest installment,
which, shall be the close of business on the Business Day preceding such
Interest Payment Date. Any such interest installment not punctually paid or duly
provided for shall forthwith cease to be payable to the Holder on such Regular
Record Date, and may be paid to the Holder in whose name this Security (or one
or more Predecessor Securities) is registered at the close of business on a
Special Record Date to be fixed by the Trustee referred to on the reverse side
hereof for the payment of such defaulted interest, notice whereof shall be given
to the Holders of the Security not less than 10 days prior to such Special
Record Date, or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Security may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in the Indenture.

               Payment of the principal of and premium, if any, and interest on
this Security will be made at the office or agency of the Trustee maintained for
that purpose in such coin or currency of the United States of America that at
the time of payment is legal tender for payment of public and private debts. The
Company may pay principal and interest by check payable in such money mailed to
the Holder's registered address or by wire transfer to a dollar account
designated by the Holder.

               This Security is, to the extent provided in the Indenture,
unsecured and will rank in right of payment on a parity with all other unsecured
and subordinated obligations of the Company.

               Unless the Certificate of Authentication hereon has been executed
by or on behalf of the Trustee, this Security shall not be entitled to any
benefit under the Indenture or be valid or obligatory for any purpose. The
provisions of this Security are continued on the reverse side hereof, and such
continued provisions shall for all purposes have the same effect as though fully
set forth at this place.

                                      A-2
<PAGE>   17

               IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed under its corporate seal.

                                      PPL CAPITAL FUNDING, INC.

                                      By:
                                          ------------------------------------
                                      Name:
Dated:                                Title

                                      Attest:

                                      By:
                                          ------------------------------------
                                      Name:
                                      Title

                     (FORM OF CERTIFICATE OF AUTHENTICATION)

                          CERTIFICATE OF AUTHENTICATION

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

                                      THE CHASE MANHATTAN BANK, as Trustee

                                      By:
                                          ------------------------------------
                                      Authorized Officer

                                      A-3
<PAGE>   18

                     (FORM OF REVERSE OF SUBORDINATED NOTE)

                            PPL CAPITAL FUNDING, INC.

                        7.29% SUBORDINATED NOTE DUE 2006

               This Subordinated Note is one of a duly authorized series of
securities of the Company (herein called the "Securities"), issued and to be
issued in one or more series under a Subordinated Indenture, dated as of May 9,
2001, as amended and supplemented (as amended and supplemented, the
"Indenture"), between the Company, PPL Corporation, as guarantor (herein called
the "Guarantor", which term includes any successor guarantor under the
Indenture) and The Chase Manhattan Bank, as Trustee (herein called the
"Trustee", which term includes any successor trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is hereby made
for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Holders of the
Securities and the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the face hereof, limited in aggregate principal amount to $515,463,918 (or
$592,783,506 if the over-allotment option referred to in the Indemnity Agreement
is exercised in full).

               All terms used in this Security that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.

               This Security is not subject to any sinking fund, nor may this
Security be redeemed at the option of the Company prior to the Maturity Date
except upon the occurrence of a Tax Event as described below.

               The Indenture contains provisions for defeasance at any time of
the entire indebtedness of this Security upon compliance by the Company with
certain conditions set forth therein.

               If an Event of Default with respect to Securities of this series
shall occur and be continuing, the principal of the Securities of this series
may be declared due and payable in the manner and with the effect provided in
the Indenture.

               If a Tax Event occurs and is continuing, the Company may, at its
option and upon not less than 30 nor more than 60 days' notice to the Holders of
the Securities, redeem the Securities in whole (but not in part) within 90 days
following the occurrence of such Tax Event at the Redemption Price. The
Redemption Price shall be paid prior to 12:00 noon, New York City time, on the
Tax Event Redemption Date, by check or wire transfer in immediately available
funds at such place and to such account as may be designated by each such
Holder.

                                      A-4
<PAGE>   19

               If an Event of Default with respect to the Subordinated Notes
shall occur and be continuing, the principal of the Subordinated Notes may be
declared due and payable in the manner, with the effect and subject to the
conditions provided in the Indenture.

               The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities at the time of all series to be
affected (voting as a class). The Indenture also contains provisions permitting
the Holders of a majority in aggregate principal amount of the Outstanding
Securities of each series at the time, on behalf of the Holders of all
Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders of
this Security and of any Security issued upon the registration of transfer
hereof or in exchange hereof or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Security.

               No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
premium, if any, and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.

               This Security shall be exchangeable for Securities registered in
the names of Persons other than the Depositary with respect to such series or
its nominee only as provided in this paragraph. This Security shall be so
exchangeable if (x) the Depositary is at any time unwilling or unable to
continue as Depositary for such series, (y) the Company executes and delivers to
the Trustee a Company Order providing that this Security shall be so
exchangeable or (z) there shall have occurred and be continuing an Event of
Default with respect to the Securities of such series. Securities so issued in
exchange for this Security shall be of the same series, having the same interest
rate, if any, and maturity and having the same terms as this Security, in
authorized denominations and in the aggregate having the same principal amount
as this Security and registered in such names as the Depositary for such global
Security shall direct.

               As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of a Security of the series of which this
Security is a part is registrable in the Security Register, upon surrender of
this Security for registration of transfer at the office or agency of the
Company in any place where the principal of and premium, if any, and interest,
if any, on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this series,
of authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.

                                      A-5
<PAGE>   20

               The Securities of the series of which this Security is a part are
issuable only in registered form without coupons in denominations of $25 and in
integral multiples thereof. As provided in the Indenture and subject to certain
limitations therein set forth, Securities of this series are exchangeable for a
like aggregate principal amount of Securities of this series and of like tenor
of a different authorized denomination, as requested by the Holder surrendering
the same.

               No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.

               Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Holder in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.

               This Security shall be governed by and construed in accordance
with the laws of the State of New York.

               All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.

                                      A-6
<PAGE>   21

                                  ABBREVIATIONS

The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:

<TABLE>
<S>                                             <C>
TEN COM --as tenants in common                  UNIF GIFT MIN ACT -- _______Custodian________
                                                                     (Cust)           (Minor)

TEN ENT --as tenants by the entireties                      under Uniform Gifts to Minors
                                                           Act __________________________
                                                                       (State)

JT TEN -- as joint tenants with rights of
          survivorship and not as
          tenants in common
</TABLE>

Additional abbreviations may also be used though not on the above list.

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

FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s)
unto _________(please insert Social Security or other identifying number of
assignee)

-------------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE
OF ASSIGNEE

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

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

the within Security and all rights thereunder, hereby irrevocably constituting
and appointing

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

agent to transfer said Security on the books of the Corporation, with full
power of substitution in the premises.

Dated:
                                                  ------------------------------

                                                  ------------------------------
                                                  NOTICE: The signature to
                                                  this assignment must
                                                  correspond with the name as
                                                  written upon the face of the
                                                  within instrument in every
                                                  particular without
                                                  alteration or enlargement,
                                                  or any change whatever.

                                                        Signature Guarantee:

                               SIGNATURE GUARANTEE

Signatures must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Security Registrar, which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Security Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.

                                      A-7
<PAGE>   22

                    [TO BE ATTACHED TO GLOBAL CERTIFICATES
                       AND PLEDGED SUBORDINATED NOTES]

                      SCHEDULE OF INCREASES OR DECREASES

       THE FOLLOWING INCREASES OR DECREASES IN THE [GLOBAL CERTIFICATE]
                 [PLEDGED SUBORDINATED NOTE] HAVE BEEN MADE:

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------
                          AMOUNT OF          AMOUNT OF      PRINCIPAL AMOUNT
                         DECREASE IN        INCREASE IN       OF 2006 NOTE
                      PRINCIPAL AMOUNT   PRINCIPAL AMOUNT   EVIDENCED BY THE
                        OF 2006 NOTE       OF 2006 NOTE          [GLOBAL
                      EVIDENCED BY THE   EVIDENCED BY THE     CERTIFICATE]
                           [GLOBAL            [GLOBAL           [PLEDGED         SIGNATURE OF
                        CERTIFICATE]       CERTIFICATE]     SUBORDINATE NOTE]     AUTHORIZED
                          [PLEDGED           [PLEDGED        FOLLOWING SUCH       OFFICER OF
                        SUBORDINATED       SUBORDINATED        DECREASE OR        TRUSTEE OR
        DATE                NOTE]              NOTE]            INCREASE        CUSTODIAL AGENT
<S>                   <C>                <C>                <C>                <C>
------------------------------------------------------------------------------------------------

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</TABLE>

                                      A-8
<PAGE>   23
                                                                       EXHIBIT B
                     [FORM OF FACE OF SUBORDINATED NOTE]

REGISTERED                                                            REGISTERED

                          PPL CAPITAL FUNDING, INC.

                      7.29% SUBORDINATED NOTES DUE 2006

                                                                     $----------

               PPL CAPITAL FUNDING, INC., a corporation duly organized and
existing under the laws of Delaware (herein called the "Company", which term
includes any successor corporation under the Indenture hereinafter referred to),
for value received, hereby promises to pay to _____________, or registered
assigns, the principal sum of [-] Dollars on May 18, 2006, and to pay interest
on said principal sum from May 9, 2001, or from the most recent Interest Payment
Date to which interest has been paid or duly provided for, quarterly in arrears
on February 18, May 18, August 18 and November 18 of each year (an "Interest
Payment Date") commencing August 18, 2001, initially at the rate of 7.29% per
annum through and including the day immediately preceding the Reset Effective
Date, and at the Reset Rate thereafter until the principal hereof shall have
been paid or duly made available for payment and, to the extent permitted by
law, to pay interest, compounded quarterly, on any overdue principal and
premium, if any, and on any overdue installment of interest at the rate per
annum of 7.29% through and including the day immediately preceding the Reset
Effective Date, and at the Reset Rate thereafter until May 18, 2006. The amount
of interest payable for any period will be computed (1) for any full quarterly
period on the basis of a 360-day year of twelve 30-day months and (2) for any
period shorter than a full quarterly period, on the basis of a 30-day month and,
for any period less than a month, on the basis of the actual number of days
elapsed per 30-day month. In the event that any date on which interest is
payable is not a Business Day, then payment of the interest payable on such date
will be made on the next day that is a Business Day (and without any interest or
other payment in respect of such delay), except that, if such Business Day is in
the next calendar year, then such payment will be made on the preceding Business
Day. The interest installment so payable, and punctually paid or duly provided
for, on any Interest Payment Date will, as provided in the Indenture, referred
to on the reverse side hereof, be paid to the Holder in whose name this Security
(or one or more Predecessor Securities, as defined in said Indenture) is
registered at the close of business on the Regular Record Date for such interest
installment, which, shall be the close of business on the Business Day preceding
such Interest Payment Date. Any such interest installment not punctually paid or
duly provided for shall forthwith cease to be

                                      B-1
<PAGE>   24

payable to the Holder on such Regular Record Date, and may be paid to the Holder
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date to be fixed by the
Trustee referred to on the reverse side hereof for the payment of such defaulted
interest, notice whereof shall be given to the Holders of the Security not less
than 10 days prior to such Special Record Date, or may be paid at any time in
any other lawful manner not inconsistent with the requirements of any securities
exchange on which the Security may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture.

               Payment of the principal of and premium, if any, and interest on
this Security will be made at the office or agency of the Trustee maintained for
that purpose in such coin or currency of the United States of America that at
the time of payment is legal tender for payment of public and private debts. The
Company may pay principal and interest by check payable in such money mailed to
the Holder's registered address or by wire transfer to a dollar account
designated by the Holder.

               This Security is, to the extent provided in the Indenture,
unsecured and will rank in right of payment on a parity with all other unsecured
and subordinated obligations of the Company.

               Unless the Certificate of Authentication hereon has been executed
by or on behalf of the Trustee, this Security shall not be entitled to any
benefit under the Indenture or be valid or obligatory for any purpose. The
provisions of this Security are continued on the reverse side hereof, and such
continued provisions shall for all purposes have the same effect as though fully
set forth at this place.

                                      B-2
<PAGE>   25

               IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed under its corporate seal.

                                      PPL CAPITAL FUNDING, INC.

                                      By:
                                          -------------------------------------
                                      Name:
Dated:                                Title

                                      Attest:

                                      By:
                                          -------------------------------------
                                      Name:
                                      Title

                     (FORM OF CERTIFICATE OF AUTHENTICATION)

                          CERTIFICATE OF AUTHENTICATION

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

                                      THE CHASE MANHATTAN BANK, as Trustee

                                      By:
                                          ------------------------------------
                                      Authorized Officer

                                      B-3
<PAGE>   26

                     (FORM OF REVERSE OF SUBORDINATED NOTE)

                            PPL CAPITAL FUNDING, INC.

                        7.29% SUBORDINATED NOTE DUE 2006

               This Subordinated Note is one of a duly authorized series of
securities of the Company (herein called the "Securities"), issued and to be
issued in one or more series under a Subordinated Indenture, dated as of May 9,
2001, as amended and supplemented (as amended and supplemented, the
"Indenture"), between the Company, PPL Corporation, as guarantor (herein called
the "Guarantor", which term includes any successor guarantor under the
Indenture) and The Chase Manhattan Bank, as Trustee (herein called the
"Trustee", which term includes any successor trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is hereby made
for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Holders of the
Securities and the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the face hereof, limited in aggregate principal amount to $515,463,918 (or
$592,783,506 if the over-allotment option referred to in the Indemnity Agreement
is exercised in full).

               All terms used in this Security that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.

               This Security is not subject to any sinking fund, nor may this
Security be redeemed at the option of the Company prior to the Maturity Date
except upon the occurrence of a Tax Event as described below.

               The Indenture contains provisions for defeasance at any time of
the entire indebtedness of this Security upon compliance by the Company with
certain conditions set forth therein.

               If an Event of Default with respect to Securities of this series
shall occur and be continuing, the principal of the Securities of this series
may be declared due and payable in the manner and with the effect provided in
the Indenture.

               If a Tax Event occurs and is continuing, the Company may, at its
option and upon not less than 30 nor more than 60 days' notice to the Holders of
the Securities, redeem the Securities in whole (but not in part) within 90 days
following the occurrence of such Tax Event at the Redemption Price. The
Redemption Price shall be paid prior to 12:00 noon, New York City time, on the
Tax Event Redemption Date, by check or wire transfer in immediately available
funds at such place and to such account as may be designated by each such
Holder.

                                      B-4
<PAGE>   27

               If an Event of Default with respect to the Subordinated Notes
shall occur and be continuing, the principal of the Subordinated Notes may be
declared due and payable in the manner, with the effect and subject to the
conditions provided in the Indenture.

               The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities at the time of all series to be
affected (voting as a class). The Indenture also contains provisions permitting
the Holders of a majority in aggregate principal amount of the Outstanding
Securities of each series at the time, on behalf of the Holders of all
Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders of
this Security and of any Security issued upon the registration of transfer
hereof or in exchange hereof or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Security.

               No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
premium, if any, and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.

               As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of a Security of the series of which this
Security is a part is registrable in the Security Register, upon surrender of
this Security for registration of transfer at the office or agency of the
Company in any place where the principal of and premium, if any, and interest,
if any, on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this series,
of authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.

               The Securities of the series of which this Security is a part are
issuable only in registered form without coupons in denominations of $1,000 and
in integral multiples thereof. As provided in the Indenture and subject to
certain limitations therein set forth, Securities of this series are
exchangeable for a like aggregate principal amount of Securities of this series
and of like tenor of a different authorized denomination, as requested by the
Holder surrendering the same.

               No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.

               All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.

                                      B-5
<PAGE>   28

                                  ABBREVIATIONS

The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:

<TABLE>
<S>                                             <C>
TEN COM --as tenants in common                  UNIF GIFT MIN ACT -- _______Custodian________
                                                                     (Cust)           (Minor)

TEN ENT --as tenants by the entireties                      under Uniform Gifts to Minors
                                                           Act __________________________
                                                                       (State)

JT TEN -- as joint tenants with rights of
          survivorship and not as
          tenants in common
</TABLE>

Additional abbreviations may also be used though not on the above list.

--------------------------------------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto (please
insert Social Security or other identifying number of assignee)

--------------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE
OF ASSIGNEE

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

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

the within Security and all rights thereunder, hereby irrevocably constituting
and appointing

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

agent to transfer said Security on the books of the Corporation, with full power
of substitution in the premises.

Dated:
                                                  ------------------------------

                                                  ------------------------------
                                                  NOTICE: The signature to this
                                                  assignment must correspond
                                                  with the name as written upon
                                                  the face of the within
                                                  instrument in every particular
                                                  without alteration or
                                                  enlargement, or any change
                                                  whatever.

                                                       Signature Guarantee:

                               SIGNATURE GUARANTEE

Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Security Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Security
Registrar in addition to, or in substitution for, STAMP, all in accordance with
the Securities Exchange Act of 1934, as amended.

                                      B-6
<PAGE>   29

                     [TO BE ATTACHED TO GLOBAL CERTIFICATES
                         AND PLEDGED SUBORDINATED NOTES]

                       SCHEDULE OF INCREASES OR DECREASES

        THE FOLLOWING INCREASES OR DECREASES IN THE [GLOBAL CERTIFICATE]
                  [PLEDGED SUBORDINATED NOTE] HAVE BEEN MADE:

<TABLE>
<CAPTION>

                          AMOUNT OF          AMOUNT OF      PRINCIPAL AMOUNT
                         DECREASE IN        INCREASE IN       OF 2006 NOTE
                      PRINCIPAL AMOUNT   PRINCIPAL AMOUNT   EVIDENCED BY THE
                        OF 2006 NOTE       OF 2006 NOTE          [GLOBAL
                      EVIDENCED BY THE   EVIDENCED BY THE     CERTIFICATE]
                           [GLOBAL            [GLOBAL           [PLEDGED         SIGNATURE OF
                        CERTIFICATE]       CERTIFICATE]     SUBORDINATE NOTE]     AUTHORIZED
                          [PLEDGED           [PLEDGED        FOLLOWING SUCH       OFFICER OF
                        SUBORDINATED       SUBORDINATED        DECREASE OR        TRUSTEE OR
        DATE                NOTE]              NOTE]            INCREASE        CUSTODIAL AGENT
<S>                   <C>                <C>                <C>                <C>
------------------------------------------------------------------------------------------------

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</TABLE>

                                      B-7

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