Document:

_________________________________________________________
            _________________________________________________________

                         INTERVEST MORTGAGE CORPORATION

                                       AND

                              THE BANK OF NEW YORK
                                   AS TRUSTEE

                                    INDENTURE

                            DATED AS OF JUNE 1, 2004

                                   $11,500,000
                      Series 6/7/04 Subordinated Debentures

                         $2,500,000 Due January 1, 2008
                         $4,000,000 Due January 1, 2010
                         $5,000,000 Due January 1, 2012

            _________________________________________________________
            _________________________________________________________

<PAGE>
                              CROSS REFERENCE TABLE
                              ---------------------

TIA Section                                      Indenture Section
-----------                                      -----------------

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

__________
N.A.  means  Not  Applicable.

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

<PAGE>
<TABLE>
<CAPTION>
                                             ARTICLE ONE

                              DEFINITIONS AND INCORPORATION BY REFERENCE
<S>                                                                                         <C>

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

SECTION 1.02. Other Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   2
              -----------------

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

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

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

                                             ARTICLE TWO

                                           THE DEBENTURES
                                           --------------

SECTION 2.01. Form and Dating. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   4
              ---------------

SECTION 2.02. Execution and Authentication . . . . . . . . . . . . . . . . . . . . . . . . .   4
              ----------------------------

SECTION 2.03. Registrar and Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . .   5
              --------------------------

SECTION 2.04. Paying Agent to Hold Money in Trust. . . . . . . . . . . . . . . . . . . . . .   5
              -----------------------------------

SECTION 2.05. Debentureholder Lists. . . . . . . . . . . . . . . . . . . . . . . . . . . . .   5
              ---------------------

SECTION 2.07. Transfer and Exchange. . . . . . . . . . . . . . . . . . . . . . . . . . . . .   6
              ---------------------

SECTION 2.08. Replacement Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . .   6
              ----------------------

SECTION 2.09. Outstanding Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . .   6
              ----------------------

SECTION 2.10. Treasury Debentures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   6
              -------------------

SECTION 2.11. Temporary Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   6
              --------------------

SECTION 2.12. Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   7
              ------------

<PAGE>
SECTION 2.13. Defaulted Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   7
              ------------------

SECTION 2.14. CUSIP Numbers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   7
              -------------

                                             ARTICLE THREE

                                               REDEMPTION
                                               ----------

SECTION 3.01. Notices to Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   7
              ------------------

SECTION 3.02. Selection of Debentures to be Redeemed . . . . . . . . . . . . . . . . . . . .   7
              -------------------------------------

SECTION 3.03. Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   8
              -------------------

SECTION 3.04. Effect of Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . .   8
              -----------------------------

SECTION 3.05. Deposit of Redemption Price. . . . . . . . . . . . . . . . . . . . . . . . . .   8
              ---------------------------

SECTION 3.06. Debentures Redeemed in Part. . . . . . . . . . . . . . . . . . . . . . . . . .   8
              --------------------------

SECTION 3.07. Repurchase At Option of Holder . . . . . . . . . . . . . . . . . . . . . . . .   8
              ------------------------------

                                             ARTICLE FOUR

                                               COVENANTS
                                               ---------

SECTION 4.01. Payment of Debentures. . . . . . . . . . . . . . . . . . . . . . . . . . . . .   9
              ---------------------

SECTION 4.02. SEC Reports. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   9
              -----------

SECTION 4.03. Compliance Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . .   9
              ----------------------

SECTION 4.04. Limitation on Dividends and Stock Purchases. . . . . . . . . . . . . . . . . .   9
              ------------------------------------------

SECTION 4.05. Pari Passu Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . . . .   9
              ----------------------

                                             ARTICLE FIVE

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

                                             ARTICLE SIX

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

SECTION 6.01. Events of Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  10
              -----------------

<PAGE>
SECTION 6.02. Acceleration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  11
              ------------

SECTION 6.03. Other Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  11
              --------------

SECTION 6.04. Waiver of Past Defaults. . . . . . . . . . . . . . . . . . . . . . . . . . . .  12
              -----------------------

SECTION 6.05. Control by Majority. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  12
              -------------------

SECTION 6.06. Limitation of Suits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  12
              -------------------

SECTION 6.07. Rights of Holders to Receive Payment . . . . . . . . . . . . . . . . . . . . .  12
              ------------------------------------

SECTION 6.08. Collection Suit by Trustee . . . . . . . . . . . . . . . . . . . . . . . . . .  12
              --------------------------

SECTION 6.09. Trustee May File Proof of Claim. . . . . . . . . . . . . . . . . . . . . . . .  12
              -------------------------------

SECTION 6.10. Priorities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  13
              ----------

SECTION 6.11. Undertaking for Costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . .  13
              ---------------------

                                             ARTICLE SEVEN

                                                TRUSTEE
                                                -------

SECTION 7.01. Duties of Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  13
              -----------------

SECTION 7.02. Rights of Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  14
              -----------------

SECTION 7.03. Individual Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . . . .  14
              ----------------------------

SECTION 7.04. Trustee's Disclaimer . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  14
              --------------------

SECTION 7.05. Notice of Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  14
              ------------------

SECTION 7.06. Reports by Trustees to Holders . . . . . . . . . . . . . . . . . . . . . . . .  15
              ------------------------------

SECTION 7.07. Compensation and Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . .  15
              --------------------------

SECTION 7.08. Replacement of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . .  15
              ----------------------

<PAGE>
SECTION 7.09. Successor Trustee by Merger, etc . . . . . . . . . . . . . . . . . . . . . . .  16
              --------------------------------

SECTION 7.10. Eligibility; Disqualification. . . . . . . . . . . . . . . . . . . . . . . . .  16
              -----------------------------

SECTION 7.11. Preferential Collection of Claims Against the Company. . . . . . . . . . . . .  16
              -----------------------------------------------------

SECTION 7.12. Paying Agents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  17
              -------------

                                             ARTICLE EIGHT

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

SECTION 8.01. Termination of the Company's Obligations . . . . . . . . . . . . . . . . . . .  17
              ----------------------------------------

SECTION 8.02. Application of Trust Money . . . . . . . . . . . . . . . . . . . . . . . . . .  18
              --------------------------

SECTION 8.03. Repayment to the Company . . . . . . . . . . . . . . . . . . . . . . . . . . .  18
              -----------------------

                                             ARTICLE NINE

SECTION 9.01. Without Consent of Holders . . . . . . . . . . . . . . . . . . . . . . . . . .  18
              --------------------------

SECTION 9.02. With Consent of Holders. . . . . . . . . . . . . . . . . . . . . . . . . . . .  18
              -----------------------

SECTION 9.03. Execution of Supplemental Indentures . . . . . . . . . . . . . . . . . . . . .  19
              ------------------------------------

SECTION 9.04. Compliance with Trust Indenture Act. . . . . . . . . . . . . . . . . . . . . .  19
              -----------------------------------

SECTION 9.05. Revocation and Effect of Consents. . . . . . . . . . . . . . . . . . . . . . .  19
              ---------------------------------

SECTION 9.06. Notation on or Exchange of Debentures. . . . . . . . . . . . . . . . . . . . .  19
              -------------------------------------

SECTION 9.07. Trustee to Sign Amendments, etc. . . . . . . . . . . . . . . . . . . . . . . .  20
              -------------------------------

                                             ARTICLE TEN

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

SECTION 10.01. Agreement to Subordinate. . . . . . . . . . . . . . . . . . . . . . . . . . .  20
               ------------------------

SECTION 10.02. Debentures Subordinated to Prior Payment of All Senior Indebtedness on
               ----------------------------------------------------------------------
               Dissolution, Liquidation or Reorganization of the Company . . . . . . . . . .  20
               ---------------------------------------------------------

<PAGE>
SECTION 10.03. Debentureholders to be Subrogated to Rights of Holders of Senior Indebtedness  21
               -----------------------------------------------------------------------------

SECTION 10.04. Obligation of the Company Unconditional . . . . . . . . . . . . . . . . . . .  21
               ---------------------------------------

SECTION 10.05. Knowledge of Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . .  22
               --------------------

SECTION 10.06. Application by Trustee of Monies Deposited With It. . . . . . . . . . . . . .  22
               -------------------------------------------------

SECTION 10.07. Subordination Rights Not Impaired by Acts or Omissions of the Company
               ---------------------------------------------------------------------
               or Holders of Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . .  22
               ---------------------------------

SECTION 10.08. Debentureholders Authorize Trustee to Effectuate Subordination of Debentures.  22
               ----------------------------------------------------------------------------

SECTION 10.09. Right of Trustee to Hold Senior Indebtedness. . . . . . . . . . . . . . . . .  23
               --------------------------------------------

SECTION 10.10. Article Ten Not to Prevent Events of Default. . . . . . . . . . . . . . . . .  23
               --------------------------------------------

SECTION 10.11. No Fiduciary Duty Created to Holders of Senior Indebtedness . . . . . . . . .  23
               -----------------------------------------------------------

SECTION 10.12. Trustee's Compensation Not Prejudiced . . . . . . . . . . . . . . . . . . . .  23
               -------------------------------------

                                             ARTICLE ELEVEN

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

SECTION 11.01. Trust Indenture Act Controls. . . . . . . . . . . . . . . . . . . . . . . . .  23
               ----------------------------

SECTION 11.02. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  23
               -------

SECTION 11.03. Certificate and Opinion as to Conditions Precedent. . . . . . . . . . . . . .  24
               --------------------------------------------------

SECTION 11.04. Statements Required in Certificate or Opinion . . . . . . . . . . . . . . . .  24
               ---------------------------------------------

SECTION 11.05. Rules by Trustee and Agents . . . . . . . . . . . . . . . . . . . . . . . . .  24
               ---------------------------

SECTION 11.06. Legal Holidays. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24
               --------------

<PAGE>
SECTION 11.07. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24
               -------------

SECTION 11.08. No Recourse Against Others. . . . . . . . . . . . . . . . . . . . . . . . . .  24
               --------------------------

SECTION 11.09. Successors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24
               ----------

SECTION 11.10. Duplicate Originals . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24
               -------------------

SECTION 11.11. Separability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24
               ------------
</TABLE>

<PAGE>
     INDENTURE,  dated  as  of  June  1,  2004,  between  INTERVEST  MORTGAGE
CORPORATION, a New York corporation (the "Company"), and THE BANK OF NEW YORK, a
New  York  banking  corporation,  as  trustee  (the  "Trustee").

     Intending  to be legally bound hereby, each party agrees as follows for the
benefit  of the other party and for the equal and ratable benefit of the Holders
of  the  Company's  Series  6/7/04  Subordinated  Debentures.

                                   ARTICLE ONE

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

     SECTION  1.01.  Definitions.

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

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

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

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

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

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

     "Debentures"  means:  the  Series  6/7/04  Subordinated  Debentures, issued
under  this  Indenture, in three maturities as follows: January 1, 2008, January
1,  2010  and  January  1,  2012;  as  amended or supplemented from time to time
pursuant  to  the  terms  of  this  Indenture; "Debenture" means any one of such
Debentures.

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

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

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

<PAGE>
supplemented  or  amended  by one or more indentures supplemental hereto entered
into  pursuant  to  the  applicable  provisions  hereof.

     "Maturity"  means  any  of  the three maturities of Debentures issued under
this  Indenture.

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

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

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

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

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

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

     "SEC"  means  the  Securities  and  Exchange  Commission.

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

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

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

     "United  States"  means  the  United  State  of  America.

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

          Term                           Defined in Section
          ----                           ------------------

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

                                        2
<PAGE>
     SECTION  1.03  Incorporation  by Reference of Trust Indenture Act. Whenever
                    -------------------------------------------------------
this  Indenture  refers to a provision of the TIA, the provision is incorporated
by  reference in and made a part of this Indenture. The following TIA terms used
in  this  Indenture  have  the  following  meanings:

     "Commission"  means  the  SEC.

     "indenture  securities"  means  the  Debentures.

     "indenture  security  holder"  means  a  Debentureholder.

     "indenture  to  be  qualified"  means  this  Indenture.

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

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

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

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

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

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

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

     (e)  If  the  Company  shall  solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company may,
at  its  option,  by  or pursuant to a Board Resolution, fix in advance a record
date  for  the  determination  of Holders entitled to give such request, demand,
authorization,  direction, notice, consent, waiver or other Act, but the Company
shall have no obligation to do so. If such a record date is fixed, such request,
demand,  authorization,  direction,  notice, consent, waiver or other Act may be
given  before  or  after  such  record  date,  but  only  the  Holders of record

                                        3
<PAGE>
at  the  close of business on such record date shall be deemed to be Holders for
the  purposes  of  determining  whether  Holders  of the requisite proportion of
outstanding  Debentures  have authorized or agreed or consented to such request,
demand,  authorization, direction, notice, consent, waiver or other Act, and for
that  purpose  the  outstanding  Debentures  shall be computed as of such record
date;  provided  that no such authorization, agreement or consent by the Holders
       --------
on  such  record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than six months after the
record  date.

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

                                   ARTICLE TWO
                                 THE DEBENTURES
                                 --------------

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

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

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

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

     The  Registrar  shall  authenticate  Debentures  for  original issue in the
aggregate  principal  amount of up to $11,500,000 (but not more than: $2,500,000
of  Debentures  maturing  January  1,  2008;  $4,000,000  of Debentures maturing
January  1,  2010;  or $5,000,000 of Debentures maturing January 1, 2012) upon a
written  order  of  the  Company  signed by two Officers or by an Officer and an
Assistant  Treasurer  of  the  Company.  The  order shall specify the amount and
Maturity  of  Debentures to be authenticated, whether interest on the Debentures
will  accrue or will be paid quarterly, and the date on which the original issue
of  Debentures  is  to  be  authenticated.  The  aggregate  principal  amount of
Debentures  outstanding  at  any  time may not exceed the amount set forth above
except  as  provided  in  Sections  2.08  and  2.09.

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

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

                                        4
<PAGE>
     SECTION  2.03.  Registrar  and Paying Agent.  The Company shall maintain an
                     ----------------------------
office  or agency where Debentures may be presented for registration of transfer
or  for  exchange  ("Registrar") and an office or agency where Debentures may be
presented  for  payment ("Paying Agent"). The Registrar shall keep a register of
the  Debentures  and of their transfer and exchange. The Company may have one or
more  co-Registrars  and  one or more additional Paying Agents. The term "Paying
Agent"  includes  any  additional  paying  agent.  The  Company  or  any  of its
Subsidiaries  may  act  as  Paying  Agent,  Registrar  or  co-Registrar.

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

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

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

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

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

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

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

                                        5
<PAGE>
Debentureholders  or  would  be  in  violation  of applicable law.  Such written
statement  shall  specify  the  basis  of  such  opinion.

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

     SECTION 2.07. Transfer and Exchange.  Where a Debenture is presented to the
                   ---------------------
Registrar or a co-Registrar with a request to register a transfer, the Registrar
shall  register  the  transfer  as  requested  if  its  requirements  for  such
transaction  are  met.  Where  Debentures  of  one Maturity are presented to the
Registrar  or  a  co-Registrar  with  a  request  to  exchange them for an equal
principal  amount of Debentures of other denominations of the same Maturity, the
Registrar  shall  make  the  exchange  as requested if its requirements for such
transaction  are met. Debentures containing a particular CUSIP Number may not be
exchanged  for  Debentures  containing another CUSIP Number. To permit transfers
and  exchanges,  upon surrender of any Debenture for registration of transfer at
the  office  or  agency  maintained  pursuant to Section 2.03, the Company shall
execute  and  the  Registrar  shall  authenticate  Debentures  to be issued upon
transfer or exchange. If so requested by the Registrar, all Debentures presented
for  exchange,  registration  of  transfer,  redemption  or  payment  shall  be
accompanied  by  a  written  instrument  of transfer in form satisfactory to the
Registrar,  duly  executed  by  the  registered  owner  or  by his attorney duly
authorized  in  writing. Any exchange or transfer shall be without charge to the
Debentureholder,  except  that  the  Company  may  require  payment  from  the
Debentureholder  of  a  sum  sufficient  to  cover any tax or other governmental
charge that may be imposed in relation thereto. The Registrar shall not transfer
or  exchange any Debenture or portion of a Debenture selected for redemption, or
transfer  or  exchange any Debentures for a period of 15 days before a selection
of  Debentures  to  be  redeemed.

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

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

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

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

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

     SECTION  2.11. Temporary Debentures.  Until definitive Debentures are ready
                    ---------------------
for  delivery,  the  Company  may  prepare  and  the  Trustee shall authenticate
temporary  Debentures.  Temporary  Debentures

                                        6
<PAGE>
shall  be  substantially  in  the  form  of  definitive  Debentures but may have
variations  that  the  Company  considers  appropriate for temporary Debentures.
Without  unreasonable  delay,  the  Company  shall prepare and the Trustee shall
authenticate  definitive Debentures in exchange for temporary Debentures.  Until
such  exchange,  temporary  Debentures  shall  be  entitled  to the same rights,
benefits  and  privileges  as  definitive  Debentures.

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

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

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

                                  ARTICLE THREE

                                   REDEMPTION
                                   ----------

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

     The  Company  shall  give  each notice provided for in this Section 3.01 at
least  45  days  before  the redemption date (except that the Trustee may in its
sole  discretion  waive  such  notice  period  at  any  time).

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

                                        7
<PAGE>
Provisions of this Indenture that apply to Debentures called for redemption also
apply  to  portions  of  Debentures  called  for redemption.

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

     SECTION  3.04. Effect of Notice of Redemption.  Once a notice of redemption
                    -------------------------------
is  mailed,  Debentures  called  for  redemption  become  due and payable on the
redemption date and at the redemption price. Upon surrender to the Paying Agent,
such  Debentures shall be paid at the redemption price, plus accrued interest to
the  redemption  date,  but interest installments for which the interest payment
date  is  on  or prior to such redemption date will be payable to the Holders of
record  at the close of business on the relevant record dates referred to in the
Debentures.

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

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

     SECTION 3.07. Repurchase At Option of Holder.  Subject to and in compliance
                   -------------------------------
with  the  provisions  of this section, at the option of the Holder thereof, the
Company  will  repurchase  Debentures at a price equal to the face amount of the
Debenture, together with all accrued interest thereon. Such right shall commence
in  calendar  year  2008  and  shall  be  subject  to the limitation that, in no
calendar  year  shall  the  Company  be  required to purchase more than $100,000
principal amount of each maturity of Debentures, on a non-cumulative basis. Such
repurchases  shall  be  made  only once each calendar year, on January 1 of each
year  commencing  in 2008. A Holder desiring the Company to purchase a Debenture
must deliver a written request to the Company, together with the Debenture and a
written  instrument  of  transfer  in  form  satisfactory to the Company and the
Registrar,  duly  executed  by  the  registered  owner  or  by his attorney duly
authorized  in  writing. The request may be made only once each year, commencing
in  2007  (for a repurchase to be made on January 1, 2008), and the Company will
repurchase  Debentures presented by Holders on a first-come, first-served basis,
based  on the date the Company receives the completed documents. The request and
completed  documents  must  be delivered no earlier than November 1 and no later
than  November  30  for  a  purchase to be completed as of January 1 of the next
year.  Only  whole  Debentures may be surrendered for repurchase and the Company
may  suspend  or  terminate  its obligation to repurchase Debentures pursuant to
this  Section  3.07  if:  (i)  it  determines,  in  its  sole  discretion,  that
circumstances  make  such  repurchase  not  reasonably  practicable;  (ii)  it
determines, in its sole discretion, that such repurchase would cause adverse tax
consequences to the Company or the Holders of Debentures; (iii) any governmental
or  regulatory  authority  with jurisdiction over the Company so demands for the
protection  of  the  Holders  of  Debentures; or (iv) it determines, in its sole
discretion,  that  such  repurchase  would  be  unlawful.

                                        8
<PAGE>
                                  ARTICLE FOUR

                                    COVENANTS
                                    ---------

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

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

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

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

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

     SECTION  4.05.  Pari  Passu Indebtedness.  There shall be no restriction on
                     -------------------------
the  amount  or type of Indebtedness of the Company which may be pari passu with
(i.e.  having  no  priority  of  payment  over  and not subordinated in right of
payment  to) or subordinate to the Debentures. At December 31, 2003, the Company
had  outstanding  the  following  Debentures  which  rank  pari  passu  with the
Debentures:  $9,000,000  aggregate  principal  amount  of  its  Series  5/12/95
Registered Floating Rate Redeemable Subordinated Debentures (the "Series 5/12/95
Debentures") which were issued pursuant to an Indenture dated as of June 1, 1995
by  and  between  the  Company  and  The  Bank of New York, $9,000,000 aggregate
principal  amount  of  its  Series  10/19/95 Registered Floating Rate Redeemable
Subordinated  Debentures  (the  "Series  10/19/95 Debentures") which were issued
pursuant to an Indenture dated as of November 1, 1995 by and between the Company
and  The  Bank of New York, $10,000,000 aggregate principal amount of its Series
5/10/96 Registered Floating Rate Redeemable Subordinated Debentures (the "Series
5/10/96 Debentures") which were issued pursuant to an Indenture dated as of June
1,  1996  by  and  between  the Company and The Bank of New York, and $5,500,000
aggregate  principal  amount  of  its  Series  10/15/96 Registered Floating Rate
Redeemable Subordinated Debentures (the "Series 10/15/96 Debentures") which were
issued  pursuant to an Indenture dated as of November 1, 1996 by and between the
Company  and  The Bank of New York, and $8,000,000 aggregate principal amount of
its  Series  4/30/97 Registered Floating Rate Redeemable Subordinated Debentures
(the  "Series  4/30/97  Debentures"), which were issued pursuant to an Indenture
dated as of May 1, 1997 by and between the Company and The Bank of New York, and
$4,000,000  aggregate  principal  amount  of its Series 11/10/98 Debentures (the
"Series  11/10/98  Debentures") which were issued pursuant to an Indenture dated
as  of  December  1,  1998  by and between the Company and The Bank of New York,
$6,500,000  aggregate  principal  amount  of  its Series 6/28/99 Debentures (the
"Series 6/28/99 Debentures") which were issued pursuant to an Indenture dated as
of  July  1,  1999  by  and  between  the

                                        9
<PAGE>
Company  and  The Bank of New York, $2,500,000 aggregate principal amount of its
Series  9/18/00  Debentures  (the "Series 9/18/00 Debentures") which were issued
pursuant  to  an  Indenture  dated  as  of September 15, 2000 by and between the
Company  and  The Bank of New York, $7,250,000 aggregate principal amount of its
Series  8/1/01  Debentures  (the  "Series  8/1/01 Debentures") which were issued
pursuant  to  an Indenture dated as of August 1, 2001 by and between the Company
and  The  Bank of New York,  $5,750,000 aggregate principal amount of its Series
1/17/02  Debentures (the "Series 1/17/02 Debentures") which were issued pursuant
to  an Indenture dated as of February 1, 2002 by and between the Company and The
Bank  of  New  York,  $7,750,000 aggregate principal amount of its Series 8/5/02
Debentures  (the  "Series  8/5/02  Debentures") which were issued pursuant to an
Indenture  dated as of August 1, 2002 by and between the Company and The Bank of
New York, $7,500,000 aggregate principal amount of its Series 1/21/03 Debentures
(the  "Series  1/21/03  Debentures")  which were issued pursuant to an Indenture
dated as of January 1, 2003 by and between the Company and The Bank of New York,
and  $8,500,000 aggregate principal amount of its Series 7/25/03 Debentures (the
"Series 7/25/03 Debentures") which were issued pursuant to an Indenture dated as
of August 1, 2003 by and between the Company and The Bank of New York,. The Bank
of  New  York,  the Trustee herein named, presently serves as trustee for all of
the  debentures  which  rank  pari  passu  with  the  Debentures.

                                  ARTICLE FIVE
                              SUCCESSOR CORPORATION
                              ---------------------

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

                                   ARTICLE SIX

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

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

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

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

                                       10
<PAGE>
          (3)  the  Company  fails to comply with any of its other agreements in
     the  Debentures  or this Indenture and the default continues for the period
     and  after  the  notice  specified  below;

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

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

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

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

     SECTION  6.02.  Acceleration.  If any Event of Default (other than an Event
                     ------------
of  Default  specified  in Section 6.01(4) or (5)) occurs and is continuing, the
Trustee  by  notice  to the Company, or the Holders of at least 25% in principal
amount  of  the outstanding Debentures by notice to the Company and the Trustee,
may  (but  shall  not  be obligated to) declare the principal of and all accrued
interest  on  all  the  Debentures  to be due and payable immediately. Upon such
declaration such principal and interest shall be due and payable immediately. If
an  Event  of  Default  specified  in  Section 6.01(4) or (5) occurs, all unpaid
principal  and  accrued  interest  on the Debentures then outstanding shall ipso
                                                                            ----
facto become and be immediately due and payable without any declaration or other
-----
act on the part of the Trustee or any Debentureholder. The Holders of a majority
in  principal  amount of the outstanding Debentures by notice to the Trustee may
rescind  an  acceleration and its consequences if all existing Events of Default
have  been  cured or waived, except nonpayment of principal or interest that has
become  due  solely because of the acceleration, and if the rescission would not
conflict  with  any  judgment  or  decree.  No  such rescission shall affect any
subsequent  Default  or  impair  any  right  consequent  thereto.

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

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

     SECTION  6.04. Waiver of Past Defaults.  Subject to Sections 6.07 and 9.02,
                    ------------------------
the  Holders  of a majority in principal amount of the outstanding Debentures by
notice  to  the  Trustee  may  waive  a  past

                                       11
<PAGE>
Default  and  its  consequences,  except a Default under Section 6.01(1) or (2).
When  a  Default  is  so  waived,  it  shall  be  deemed  cured  and  ceases.

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

     SECTION  6.06.  Limitation  of Suits.  A Debentureholder may not pursue any
                     ---------------------
remedy  with  respect to this Indenture or the Debentures unless: (i) the Holder
gives  to  the Trustee written notice of a continuing Event of Default; (ii) the
Holders of at least 25% in principal amount of the outstanding Debentures make a
written  request  to  the  Trustee  to  pursue  the remedy; (iii) such Holder or
Holders  offer  and, if requested, provide to the Trustee indemnity and security
satisfactory  to  the  Trustee  against any loss, liability or expense; (iv) the
Trustee  does  not  comply  with the request within 60 days after receipt of the
request  and  the  offer and, if requested, provision of indemnity and security;
and  (v) during such 60-day period the Holders of a majority in principal amount
of  the  Debentures  do  not give the Trustee a direction inconsistent with such
request.

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

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

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

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

     SECTION  6.10.  Priorities.  If the  Trustee collects any money pursuant to
                     ----------
this  Article Six, it shall pay out the money in the following order: (i) first,
to  the Trustee and any predecessor Trustee for costs and expenses of collection
of  such  monies  and  for  compensation  payable  to  the Trustee or its agents

                                       12
<PAGE>
and  counsel  and  all  other  expenses, liabilities, advances and other amounts
incurred,  made  or  due  under  Section 7.07; (ii) second, to holders of Senior
Indebtedness  of the Company to the extent required by Article Ten; (iii) third,
to  Debentureholders  for amounts due and unpaid on the Debentures for principal
and  interest, ratably, without preference or priority of any kind, according to
the  amounts  due  and  payable  on  the  Debentures for principal and interest,
respectively;  and  (iv)  fourth,  to the Company.  The Trustee may fix a record
date  and  payment  date  for  any  payment to Debentureholders pursuant to this
Section.

     SECTION  6.11.  Undertaking  for Costs . In any suit for the enforcement of
                     -----------------------
any  right or remedy under this Indenture or in any suit against the Trustee for
any  action  taken  or  omitted  by it as Trustee, a court in its discretion may
require  the  filing  by any party litigant in the suit of an undertaking to pay
the  costs  of  the  suit, and the court in its discretion may assess reasonable
costs,  including  reasonable attorneys' fees, against any party litigant in the
suit,  having due regard for the merits and good faith of the claims or defenses
made  by  the  party litigant. This Section 6.11 does not apply to a suit by the
Trustee,  a  suit  by  a Holder pursuant to Section 6.07 or a suit by Holders of
more  than  10%  in  principal  amount  of  the  outstanding  Debentures.

                                  ARTICLE SEVEN

                                    TRUSTEE
                                    -------

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

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

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

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

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

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

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

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

                                       13
<PAGE>
     SECTION  7.02.  Rights  of  Trustee.  Subject  to  Section  7.01:
                     -------------------

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

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

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

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

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

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

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

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

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

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

                                       14
<PAGE>
Officers  of  the Trustee in good faith determine(s) that withholding the notice
is  in  the  interest  of  Debentureholders.

     SECTION  7.06.  Reports  by Trustees to Holders.  Within 60 days after each
                     --------------------------------
May  15,  beginning  with  May  15,  2002,  the  Trustee  shall  mail  to  each
Debentureholder  a  brief  report dated as of such May 15 that complies with TIA
Sec.  313(a).  The  Trustee also shall comply with TIA Sec. 313(b), (c) and (d).

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

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

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

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

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

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

     If  the  Trustee resigns or is removed or if a vacancy exists in the office
of  Trustee  for  any  reason,  the  Company  shall promptly appoint a successor
Trustee.

     A  successor  Trustee shall deliver a written acceptance of its appointment
to  the  retiring  Trustee  and  to  the  Company.  Immediately  thereafter, the
retiring  Trustee  shall  transfer  all  property  held  by it as Trustee to the
successor  Trustee  (subject  to  the  lien  provided  for in Section 7.07), the
resignation  or

                                       15
<PAGE>
removal  of  the  retiring  Trustee  shall  become  effective, and the successor
Trustee  shall  have all the rights, powers and duties of the Trustee under this
Indenture.  A  successor  Trustee  shall  mail  notice of its succession to each
Debentureholder.

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

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

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

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

     This  Indenture  shall always have a trustee who satisfies the requirements
of  TIA  Sec.  310(a)(1) and (2).  The Trustee shall comply with TIA Sec. 310(b)
and,  for  purposes  of  TIA Sec.310(b)(1), the following indentures satisfy the
requirements  for  such  exclusion  set  forth  in  TIA  Sec.  310(b)(1)(i): the
Indenture  dated  as of June 1, 1995, by and between the Company and The Bank of
New York, as Trustee, the Indenture dated as of November 1, 1995, by and between
the Company and The Bank of New York, as Trustee, the Indenture dated as of June
1,  1996,  by  and between the Company and The Bank of New York, as Trustee, the
Indenture  dated as of November 1, 1996, by and between the Company and The Bank
of  New  York, as Trustee, the Indenture dated as of May 1, 1997, by and between
the  Company  and  The  Bank  of New York, as Trustee, the Indenture dated as of
December  1,  1998,  by  and  between  the  Company and the Bank of New York, as
Trustee,  the Indenture dated as of July 1, 1999, by and between the Company and
The  Bank of New York, as Trustee, the Indenture dated as of September 15, 2000,
by  and  between the Company and The Bank of New York, as Trustee, the Indenture
dated as of August 1, 2001, by and between the Company and The Bank of New York,
the  Indenture  dated as of February 1, 2002, by and between the Company and The
Bank  of  New York, the Indenture dated as of August 1, 2002, by and between the
Company  and The Bank of New York, the Indenture dated as of January 1, 2003, by
and  between the Company and The Bank of New York, and the Indenture dated as of
August  1,  2003, by and between the Company and The Bank of New York.  The Bank
of  New  York  presently  serves  as  trustee  under  each  such  indenture.

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

     SECTION  7.12.  Paying  Agents.  The  Company shall cause each Paying Agent
                     --------------
other  than  the  Trustee  to  execute  and  deliver  to  it  and the Trustee an
instrument  in  which  such  Agent  shall agree with the Trustee, subject to the
provisions  of this Section 7.12; (i) that it will hold sums held by it as Agent
for the payment of principal of or interest on the Debentures (whether such sums
have  been  paid  to  it  by  the

                                       16
<PAGE>
Company or by any obligor on the Debentures) in trust for the benefit of Holders
of  the  Debentures; (ii) that it will at any time during the continuance of any
Event of Default, upon written request from  the Trustee, deliver to the Trustee
all  sums  so  held  in trust by it; (iii) that it will give the Trustee written
notice  within  three  Business  Days  of  any failure of the Company (or by any
obligor on the Debentures) in the payment of any installment of the principal of
or  interest  on the Debentures when the same shall be due and payable; and (iv)
that  it  will  comply  with  the  provisions  of  the  TIA  applicable  to  it.

                                  ARTICLE EIGHT

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

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

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

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

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

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

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

     SECTION  8.02. Application of Trust Money.  The Trustee shall hold in trust
                    ---------------------------
money  and  U.S.  Government  Obligations  deposited with it pursuant to Section
8.01.  It  shall  apply  the  deposited  money  through  the Paying Agent and in
accordance  with  this  Indenture to the payment of principal of and interest on
Debentures.  Money and U.S. Government Obligations so held in trust shall not be
subject  to  Article  Ten.

                                       17
<PAGE>
     SECTION  8.03.  Repayment  to  the  Company.   Subject to Section 7.07, the
                     ---------------------------
Trustee  and the Paying Agent shall promptly pay to the Company upon request any
excess  money or securities held by them at any time. The Trustee and the Paying
Agent  shall  pay  to  the  Company  upon request any money held by them for the
payment  of principal or interest that remains unclaimed for two years, provided
such request is made by the Company within one year after the expiration of such
two year period that such money remains unclaimed. Thereafter, the Company shall
have  no right to request repayment of unclaimed money, and such unclaimed money
shall  be held and disposed of by the Trustee in accordance with applicable law.
The  Trustee and the Paying Agent shall have no right to request or require that
the  Company  accept  repayment  of  any  unclaimed  money.

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

                                  ARTICLE NINE

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

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

     SECTION  9.02.  With  Consent of Holders.  The Company, with the consent of
                     -------------------------
the  Trustee,  may  amend or supplement this Indenture or the Debentures without
notice to any Debentureholder, but with the written consent of the Holders of at
least  a majority in principal amount of the outstanding Debentures. The Holders
of  a  majority  in  principal  amount  of  the outstanding Debentures may waive
compliance by the Company with any provision of this Indenture or the Debentures
without  notice  to  any  Debentureholder.  Without  the  consent  of  each
Debentureholder affected, however, an amendment, supplement or waiver, including
a  waiver pursuant to Section 6.04, may not: (i) reduce the amount of Debentures
whose  Holders  must  consent to an amendment, supplement or waiver; (ii) reduce
the  rate of or extend the time for payment of interest on any Debenture (except
that  Holders  of  not  less  than  75%  in  principal amount of all outstanding
Debentures  may  consent,  on  behalf  of  the Holders of all of the outstanding
Debentures,  to  the  postponement  of  any  interest  payment  for a period not
exceeding  three  years  from  its  due  date); (iii) reduce the principal of or
extend  the fixed maturity of any Debenture; (iv) waive a default in the payment
of the principal of or interest on, or other redemption payment with respect to,
any Debenture, (v) make any Debenture payable in money other than that stated in
the  Debenture;  (vi)  make any change in Article Ten that adversely affects the
rights of any Debentureholder; or (vii) make any change in Section 6.04, 6.07 or
the  third  sentence  of  this  Section  9.02.

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

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

                                       18
<PAGE>
     Upon  the  request of the Company, accompanied by a resolution of the Board
of Directors or any duly authorized committee thereof, authorizing the execution
of  any  such  supplemental  indenture,  and upon the filing with the Trustee of
evidence  satisfactory  to the Trustee of the consent of the Debentureholders as
aforesaid,  the  Trustee  shall  join  with  the  Company  in  execution of such
supplemental  indenture unless such supplemental indenture affects the Trustee's
own  rights,  duties  or  immunities  under  this  Indenture.

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

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

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

     The  Company  may, but shall not be obligated to, fix a record date for the
purpose  of  determining  the  persons  entitled  to  consent  to  any indenture
supplemental  hereto.  If  a  record  date  is fixed, the Holders on such record
date, or their duly designated proxies, and only such persons, shall be entitled
to  consent  to  such supplemental indenture, whether or not such Holders remain
Holders  after  such  record date; provided, that unless such consent shall have
become  effective  by  virtue  of  the requisite percentage having been obtained
prior  to  the date which is six months after such record date, any such consent
previously given shall automatically and without further action by any Holder be
canceled  and  of  no  further  effect.

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

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

                                       19
<PAGE>
     SECTION  9.07.  Trustee  to Sign Amendments, etc.  The Trustee may but need
                     ---------------------------------
not sign any amendment, supplement or waiver authorized pursuant to this Article
if  the  amendment,  supplement  or  waiver  adversely affects the rights of the
Trustee.  The  Trustee  shall  be  entitled  to request and receive an indemnity
satisfactory  to  it  before  signing  any  amendment,  supplement  or  waiver.

                                   ARTICLE TEN

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

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

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

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

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

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

     (b)  any  payment  or  distribution of assets of the Company of any kind or
character,  whether in cash, property or securities, to which the Holders of the
Debentures  or  the  Trustee on behalf of the Holders of the Debentures would be
entitled  except  for  the  provisions  of  this Article Ten, including any such
payment  or  distribution  which  may be payable or deliverable by reason of the
payment  of  any  other  indebtedness  of  the Company being subordinated or the
payment  of the Debentures, shall be paid by the liquidating trustee or agent or
other  person  making  such  payment  or distribution directly to the holders of

                                       20
<PAGE>
the Senior Indebtedness or their representative (pro rata as to each such holder
or  representative  on  the  basis  of  the  respective amounts of unpaid Senior
Indebtedness  held  or  represented  by  each),  to the extent necessary to make
payment in full of all Senior Indebtedness remaining unpaid, after giving effect
to  any  concurrent payment or distribution or provision therefor to the holders
of  such  Senior  Indebtedness,  except  that Holders of the Debentures shall be
entitled  to  receive securities that are subordinated to Senior Indebtedness to
at  least  the  same  extent  as  the  Debentures;  and

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

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

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

     SECTION  10.04. Obligation of the Company Unconditional.  Nothing contained
                     ----------------------------------------
in  this  Article  Ten  or  elsewhere  in  this Indenture or in any Debenture is
intended  to  or  shall impair, as between the Company, its creditors other than
Holders of Senior Indebtedness and the Holders of the Debentures, the obligation
of  the  Company,  which is absolute and unconditional, to pay to the Holders of
the  Debentures  the principal of and interest on the Debentures as and when the
same shall become due and payable in accordance with their terms, or is intended
to  or  shall  affect  the  relative rights of the Holders of the Debentures and
creditors of the Company, other than the holders of the Senior Indebtedness, nor
shall  anything  herein  or  therein  prevent  the  Trustee or the Holder of any
Debenture  from  exercising  all  remedies otherwise permitted by applicable law
upon  default  under  this  Indenture, subject to the rights, if any, under this
Article  Ten  of the holders of Senior Indebtedness in respect of cash, property
or securities of the Company received upon the exercise of any such remedy. Upon
any  distribution  of assets of the Company referred to in this Article Ten, the
Trustee, subject to the provisions of Sections 7.01 and 7.02, and the Holders of
the  Debentures  shall  be entitled to rely upon any order or decree made by any
court  of  competent  jurisdiction  in  which  such  dissolution,  winding  up,
liquidation  or  reorganization proceedings are pending, or a certificate of the
liquidating  trustee  or  agent  or  other person making any distribution to the
Trustee  or  the  Holders of the Debentures, for the purpose of ascertaining the
persons  entitled  to

                                       21
<PAGE>
participate  in  such  distribution,  the holders of the Senior Indebtedness and
other  Indebtedness  of  the Company, the amount thereof or payable thereon, the
amount  or  amounts  paid  or  distributed thereon and all other facts pertinent
thereto  or  to  this  Article  Ten.

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

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

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

     SECTION  10.07.  Subordination  Rights Not Impaired by Acts or Omissions of
                      ----------------------------------------------------------
the  Company  or  Holders  of  Senior  Indebtedness.  No right of any present or
----------------------------------------------------
future  holders  of any Senior Indebtedness to enforce subordination as provided
herein  shall  at  any  time  in any way be prejudiced or impaired by any act or
failure  to  act  on the part of the Company or by any act or failure to act, in
good  faith, by any such holder, or by any noncompliance by the Company with the
terms  of  this  Indenture,  regardless  of any knowledge thereof which any such
holder may have or be otherwise charged with. The holders of Senior Indebtedness
may  extend,  renew, modify or amend the terms of the Senior Indebtedness or any
security therefor and release, sell or exchange such security and otherwise deal
freely  with  the Company, all without affecting the liabilities and obligations
of the parties to the Indenture or the Holders. No provision in any supplemental
indenture  which  affects  the  superior  position  of  the  holders of any then
existing  Senior  Indebtedness  shall  be  effective  against the holders of the
Senior  Indebtedness  who  have  not  consented  thereto.

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

     SECTION  10.09.  Right of Trustee to Hold Senior Indebtedness.  The Trustee
                      ---------------------------------------------
shall  be entitled to all of the rights set forth in this Article Ten in respect
of  any  Senior  Indebtedness  at  any  time  held  by  it  to

                                       22
<PAGE>
the  same extent as any other holder of Senior Indebtedness, and nothing in this
Indenture shall be construed to deprive the Trustee of any of its rights as such
holder.

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

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

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

                                 ARTICLE ELEVEN

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

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

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

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

     If  to  the  Company,  addressed  to:

          INTERVEST  MORTGAGE  CORPORATION
          One  Rockefeller  Plaza,  Suite  400
          New  York,  New  York  10020-2002

     If  to  the  Trustee,  addressed  to:

          THE  BANK  OF  NEW  YORK
          101  Barclay  Street  -  12W
          New  York,  New  York  10286
          Attention:  Corporate  Trust  Department

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

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

                                       23
<PAGE>
     Failure  to  mail  a  notice  or  communication to a Debentureholder or any
defect  in  it  shall  not  affect  its  sufficiency  with  respect  to  other
Debentureholders.  If  a  notice or communication is mailed to a Debentureholder
in  the  manner provided in this paragraph (b), it is duly given, whether or not
the  addressee  receives  it.  If the Company mails a notice or communication to
Debentureholders  it  shall  mail  a copy of such notice to the Trustee and each
Agent  at  the  same  time.

     SECTION  11.03.  Certificate  and  Opinion  as  to  Conditions  Precedent.
                      --------------------------------------------------------
     Upon  any  request or application by the Company to the Trustee to take any
action  under  this  Indenture, the Company shall furnish to the Trustee: (i) an
Officers'  Certificate in form and substance satisfactory to the Trustee stating
that  all  conditions precedent, if any, provided for in this Indenture relating
to  the proposed actions have been complied with; and (ii) an Opinion of Counsel
in  form  and substance satisfactory to the Trustee stating that, in the opinion
of  such  counsel,  all  such  conditions  precedent  have  been  complied with.

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

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

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

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

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

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

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

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

                                       24
<PAGE>
                                            SIGNATURES

Dated as of June 1, 2004                    INTERVEST MORTGAGE CORPORATION

                                            By: /s/ Lowell S. Dansker
                                            Name: Lowell S. Dansker
                                            Title: President

Attest:
/s/ Lawrence G. Bergman
Name: Lawrence G. Bergman
Title: Secretary

                                            THE BANK OF NEW YORK
                                            as Trustee

                                            By: /s/ Dorothy Miller
                                            Name: Dorothy Miller
                                            Title: Vice President

Attest:

/s/ Cynthia J. Chaney
Name: Cynthia J. Chaney
Title: Vice President

                                       25
<PAGE>
                                                                       Exhibit A
                                                                       ---------

     (FORM  OF ACCRUAL DEBENTURE MATURING JANUARY 1, 2008)
 Number R(6704/08)A-                                                   $

                         INTERVEST MORTGAGE CORPORATION
            Series 6/7/04 Subordinated Debenture due January 1, 2008

     INTERVEST  MORTGAGE  CORPORATION, a corporation duly organized and existing
under  the  laws of the State of New York (the "Company"), promises to pay to or
registered assigns the principal sum of ________________________________________
Dollars  on January 1, 2008, together with interest accruing on principal at six
and one-quarter percent (6 1/4%) per annum, plus interest accruing each calendar
quarter on the balance of interest accrued as of (and including) the last day of
the  preceding  calendar  quarter  at  six  and one-quarter percent (6 1/4%) per
annum,  and  with all accrued interest payable with the principal sum on January
1,  2008.  The provisions on the back of this certificate are incorporated as if
set  forth  on  the  face  of  the  certificate.

                                            Record Dates:
                                            The first day of the third month
                                            of the calendar quarter

DATED:

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

THE BANK OF NEW YORK, as                    INTERVEST MORTGAGE CORPORATION
  Registrar

By: _______________________ (Seal)          By:___________________________
     Authorized  Signatory                         President

                                            By:__________________________
                                                   Secretary

                                       A-1
<PAGE>
                             (REVERSE OF DEBENTURE)

            Series 6/7/04 Subordinated Debenture due January 1, 2008

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

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

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

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

          4.  Indenture.  This  Debenture  is one of a duly authorized series of
              ---------
Debentures  issued  by  the  Company under an Indenture dated as of June 1, 2004
(the  "Indenture") between the Company and The Bank of New York, as trustee (the
"Trustee").  The term "Debentures" being used herein refers to all Maturities of
Debentures  issued  under  the  Indenture.  Capitalized terms herein are used as
defined in the Indenture unless otherwise indicated. Reference is hereby made to
the  Indenture  for  a  description  of  the  rights,  obligations,  duties  and
immunities  of  the  Trustee  and  the  Debentureholders  and  for the terms and
conditions  upon  which  the Debentures are and are to be issued. The Debentures
are  general  unsecured  obligations  of  the  Company  limited to the aggregate
principal  amount  of  $11,500,000  of which a maximum of $2,500,000 will have a
maturity  date  of January 1, 2008, a maximum of $4,000,000 will have a maturity
date  of  January 1, 2010, and a maximum of $5,000,000 will have a maturity date
of  January  1,  2012.

          5.  Optional  Redemption.  The  Company  may  at its option redeem the
              -------------------
Debentures  of  any CUSIP Number in whole or in part at any time. The redemption
price will be equal to (i) the face amount of the Debentures to be redeemed plus
a  1%  premium  if the date of redemption is prior to July 1, 2005, and (ii) the
face  amount of the Debentures to be redeemed if the date of redemption is after
July  1,  2005.

                                       A-2
<PAGE>
          6.  Selection  and  Notice  of  Redemption.  If  less  than all of the
              ------------------------------------
Debentures  of  any  CUSIP Number are to be redeemed, the Registrar shall select
the  Debentures  to  be redeemed by such method as the Registrar shall deem fair
and  appropriate,  or  if  the  Debentures  are  listed on a national securities
exchange,  in  accordance  with  the rules of such exchange. The Registrar shall
make the selection from the Debentures outstanding and not previously called for
redemption.  The  Registrar may select for redemption portions (equal to $10,000
or  any  integral  multiple  thereof) of the principal amount of Debentures that
have  denominations  larger than $10,000. Provisions of the Indenture that apply
to  Debentures called for redemption also apply to portions of Debentures called
for  redemption.  Notice  of  redemption will be mailed at least 30 days but not
more  than 90 days before the redemption date to each holder of Debentures to be
redeemed  at  his registered address. On and after the redemption date, interest
ceases  to  accrue  on  Debentures  or  portions  thereof called for redemption.

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

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

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

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

          11.  Defaults  and  Remedies.  The Indenture provides that the Trustee
               -----------------------
will  give the Debentureholders notice of an uncured Default known to it, within
90  days  after  the  occurrence  of  an  Event  of  Default  (as defined in the
Indenture),  or  as  soon  as practicable after it learns of an Event of Default
which  occurred  more than 90 days beforehand; provided that, except in the case
of  Default  in the payment of principal of or interest on any of the Debentures
or  any  amount due on redemption, the Trustee may withhold such notice if it in
good  faith determines that the withholding of such notice is in the interest of
the  Debentureholders. In case an Event of Default occurs and is continuing, the
Trustee or the holders of not less than 25% of aggregate principal amount of the
Debentures  then  outstanding,  by

                                       A-3
<PAGE>
notice  in  writing  to  the  Company  (and  to  the  Trustee  if  given  by the
Debentureholders),  may declare the principal of and all accrued interest on all
the  Debentures  to  be  due  and  payable immediately.  Such declaration may be
rescinded  by holders of a majority in principal amount of the Debentures if all
existing  Events of Default (except nonpayment of principal or interest that has
become  due solely because of the acceleration) have been cured or waived and if
the  rescission  would  not conflict with any judgment or decree.  The Indenture
requires the Company to file periodic reports with the Trustee as to the absence
of  defaults.

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

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

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

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

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

          The  Company  will furnish to any Debentureholder upon written request
and  without  charge  a copy of the Indenture. Requests may be made to Intervest
Mortgage  Corporation,  One  Rockefeller  Plaza,  Suite  400, New York, New York
10020-2002.

                                       A-4
<PAGE>
                                   ASSIGNMENT

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

I  or  we  assign  and  transfer  this  Debenture  to

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

______________________________________________

______________________________________________

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

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

Date:     _____________________  Your  signature:_______________________________

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

Signature Guarantee: ___________________________

                                       A-5
<PAGE>
                                                                       Exhibit B
                                                                       ---------

          (FORM  OF  ACCRUAL  DEBENTURE  MATURING  JANUARY  1,  2010)  Number
R(6704/10)A-  $

                         INTERVEST MORTGAGE CORPORATION
            Series 6/7/04 Subordinated Debenture due January 1, 2010

     INTERVEST  MORTGAGE  CORPORATION, a corporation duly organized and existing
under  the  laws of the State of New York (the "Company"), promises to pay to or
registered assigns the principal sum of ________________________________________
Dollars  on January 1, 2010, together with interest accruing on principal at six
and  one-half  percent  (6 1/2%) per annum, plus interest accruing each calendar
quarter on the balance of interest accrued as of (and including) the last day of
the  preceding  calendar quarter at six and one-half percent (61/2 %) per annum,
and with all accrued interest payable with the principal sum on January 1, 2010.
The  provisions on the back of this certificate are incorporated as if set forth
on  the  face  of  the  certificate.

                                          Record  Dates:
                                          The first day of the third month of
                                          the calendar quarter

DATED:

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

THE BANK OF NEW YORK, as                  INTERVEST MORTGAGE CORPORATION
  Registrar

By: _______________________ (Seal)        By:___________________________
     Authorized  Signatory                         President

                                          By:___________________________
                                                    Secretary

                                       B-1
<PAGE>
                             (REVERSE OF DEBENTURE)

            Series 6/7/04 Subordinated Debenture due January 1, 2010

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

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

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

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

          4.  Indenture.  This  Debenture  is one of a duly authorized series of
              ---------
Debentures  issued  by  the  Company under an Indenture dated as of June 1, 2004
(the  "Indenture") between the Company and The Bank of New York, as trustee (the
"Trustee").  The term "Debentures" being used herein refers to all Maturities of
Debentures  issued  under  the  Indenture.  Capitalized terms herein are used as
defined in the Indenture unless otherwise indicated. Reference is hereby made to
the  Indenture  for  a  description  of  the  rights,  obligations,  duties  and
immunities  of  the  Trustee  and  the  Debentureholders  and  for the terms and
conditions  upon  which  the Debentures are and are to be issued. The Debentures
are  general  unsecured  obligations  of  the  Company  limited to the aggregate
principal  amount  of  $11,500,000  of which a maximum of $2,500,000 will have a
maturity  date  of January 1, 2008, a maximum of $4,000,000 will have a maturity
date  of  January 1, 2010, and a maximum of $5,000,000 will have a maturity date
of  January  1,  2012.

          5.  Optional  Redemption.  The  Company  may  at its option redeem the
              --------------------
Debentures  of  any CUSIP Number in whole or in part at any time. The redemption
price will be equal to (i) the face amount of the Debentures to be redeemed plus
a  1%  premium  if the date of redemption is prior to July 1, 2005, and (ii) the
face  amount of the Debentures to be redeemed if the date of redemption is on or
after  July  1,  2005.

                                       B-2
<PAGE>
          6.  Selection  and  Notice  of  Redemption.  If  less  than all of the
              --------------------------------------
the  Debentures  to  be redeemed by such method as the Registrar shall deem fair
and  appropriate,  or  if  the  Debentures  are  listed on a national securities
exchange,  in  accordance  with  the rules of such exchange. The Registrar shall
make the selection from the Debentures outstanding and not previously called for
redemption.  The  Registrar may select for redemption portions (equal to $10,000
or  any  integral  multiple  thereof) of the principal amount of Debentures that
have  denominations  larger than $10,000. Provisions of the Indenture that apply
to  Debentures called for redemption also apply to portions of Debentures called
for  redemption.  Notice  of  redemption will be mailed at least 30 days but not
more  than 90 days before the redemption date to each holder of Debentures to be
redeemed  at  his registered address. On and after the redemption date, interest
ceases  to  accrue  on  Debentures  or  portions  thereof called for redemption.

          7.  Optional  Repurchase.  Commencing  in 2007 (for a repurchase to be
              --------------------
made  on  January 1, 2008), a holder will have the option to require the Company
to  repurchase the Debenture for the face amount plus accrued interest, provided
that  a  request  for repurchase, accompanied by the Debenture and a written and
duly executed instrument of transfer is submitted to the Company no earlier than
November 1 and no later than November 30. to be effective as of January 1 of the
next  year.  Repurchases  shall  be  made once each year as of January 1 and are
subject  to  the  limitation that the Company is not required to repurchase more
than  $100,000  principal  amount  of  each  maturity in any calendar year, on a
non-cumulative  basis.  The  Company will repurchase Debentures on a first-come,
first-served  basis.

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

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

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

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

                                       B-3
<PAGE>
          12.  Defaults  and  Remedies.  The Indenture provides that the Trustee
               -----------------------
will  give the Debentureholders notice of an uncured Default known to it, within
90  days  after  the  occurrence  of  an  Event  of  Default  (as defined in the
Indenture),  or  as  soon  as practicable after it learns of an Event of Default
which  occurred  more than 90 days beforehand; provided that, except in the case
of  Default  in the payment of principal of or interest on any of the Debentures
or  any  amount due on redemption, the Trustee may withhold such notice if it in
good  faith determines that the withholding of such notice is in the interest of
the  Debentureholders. In case an Event of Default occurs and is continuing, the
Trustee or the holders of not less than 25% of aggregate principal amount of the
Debentures  then  outstanding,  by  notice in writing to the Company (and to the
Trustee  if given by the Debentureholders), may declare the principal of and all
accrued  interest  on all the Debentures to be due and payable immediately. Such
declaration may be rescinded by holders of a majority in principal amount of the
Debentures  if all existing Events of Default (except nonpayment of principal or
interest that has become due solely because of the acceleration) have been cured
or  waived and if the rescission would not conflict with any judgment or decree.
The  Indenture requires the Company to file periodic reports with the Trustee as
to  the  absence  of  defaults.

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

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

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

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

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

                                       B-4
<PAGE>
          The  Company  will furnish to any Debentureholder upon written request
and  without  charge  a copy of the Indenture. Requests may be made to Intervest
Mortgage  Corporation,  One  Rockefeller  Plaza,  Suite  400, New York, New York
10020-2002.

                                       B-5
<PAGE>
                                   ASSIGNMENT

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

I  or  we  assign  and  transfer  this  Debenture  to

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

______________________________________________

______________________________________________

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

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

Date:     _____________________  Your  signature:_______________________________

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

Signature Guarantee: ___________________________

                                       B-6
<PAGE>
                                                                       Exhibit C
                                                                       ---------

              (FORM OF ACCRUAL DEBENTURE MATURING JANUARY 1, 2012)
Number  R(6704/12)A-               $

                         INTERVEST MORTGAGE CORPORATION
            Series 6/7/04 Subordinated Debenture due January 1, 2012

     INTERVEST  MORTGAGE  CORPORATION, a corporation duly organized and existing
under  the  laws of the State of New York (the "Company"), promises to pay to or
registered assigns the principal sum of ________________________________________
Dollars  on January 1, 2012, together with interest accruing on principal at six
and  three-quarters  percent  (6  3/4%)  per  annum, plus interest accruing each
calendar  quarter  on  the balance of interest accrued as of (and including) the
last  day of the preceding calendar quarter at six and three-quarters percent (6
3/4%) per annum, and with all accrued interest payable with the principal sum on
January  1,  2012.  The  provisions  on  the  back  of  this  certificate  are
incorporated  as  if  set  forth  on  the  face  of  the  certificate.

                                          Record  Dates:
                                          The first day of the third month of
                                          the calendar quarter

DATED:

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

THE BANK OF NEW YORK, as                  INTERVEST MORTGAGE CORPORATION
  Registrar

By: _______________________ (Seal)        By:___________________________
     Authorized  Signatory                         President

                                          By:___________________________
                                                    Secretary

                                       C-1
<PAGE>
                             (REVERSE OF DEBENTURE)

            Series 6/7/04 Subordinated Debenture due January 1, 2012

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

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

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

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

          4.  Indenture.  This  Debenture  is one of a duly authorized series of
              ---------
Debentures  issued  by  the  Company under an Indenture dated as of June 1, 2004
(the  "Indenture") between the Company and The Bank of New York, as trustee (the
"Trustee").  The term "Debentures" being used herein refers to all Maturities of
Debentures  issued  under  the  Indenture.  Capitalized terms herein are used as
defined in the Indenture unless otherwise indicated. Reference is hereby made to
the  Indenture  for  a  description  of  the  rights,  obligations,  duties  and
immunities  of  the  Trustee  and  the  Debentureholders  and  for the terms and
conditions  upon  which  the Debentures are and are to be issued. The Debentures
are  general  unsecured  obligations  of  the  Company  limited to the aggregate
principal  amount  of  $11,500,000  of which a maximum of $2,500,000 will have a
maturity  date  of January 1, 2008, a maximum of $4,000,000 will have a maturity
date  of  January 1, 2010, and a maximum of $5,000,000 will have a maturity date
of  January  1,  2012.

          5.  Optional  Redemption.  The  Company  may  at its option redeem the
              --------------------
Debentures  of  any CUSIP Number in whole or in part at any time. The redemption
price  will  be  equal  to: (i) the face amount of the Debentures to be redeemed
plus  a  1% premium if the date of redemption is prior to July 1, 2005, and (ii)
the face amount of the Debentures to be redeemed if the date of redemption is on
or  after  July  1,  2005.

                                       C-2
<PAGE>
          6.  Selection  and  Notice  of  Redemption.  If  less  than all of the
              --------------------------------------
Debentures  of  any  CUSIP Number are to be redeemed, the Registrar shall select
the  Debentures  to  be redeemed by such method as the Registrar shall deem fair
and  appropriate,  or  if  the  Debentures  are  listed on a national securities
exchange,  in  accordance  with  the rules of such exchange. The Registrar shall
make the selection from the Debentures outstanding and not previously called for
redemption.  The  Registrar may select for redemption portions (equal to $10,000
or  any  integral  multiple  thereof) of the principal amount of Debentures that
have  denominations  larger than $10,000. Provisions of the Indenture that apply
to  Debentures called for redemption also apply to portions of Debentures called
for  redemption.  Notice  of  redemption will be mailed at least 30 days but not
more  than 90 days before the redemption date to each holder of Debentures to be
redeemed  at  his registered address. On and after the redemption date, interest
ceases  to  accrue  on  Debentures  or  portions  thereof called for redemption.

          7.  Optional  Repurchase.  Commencing  in 2007 (for a repurchase to be
              --------------------
made  on  January 1, 2008), a holder will have the option to require the Company
to  repurchase the Debenture for the face amount plus accrued interest, provided
that  a  request  for repurchase, accompanied by the Debenture and a written and
duly executed instrument of transfer is submitted to the Company no earlier than
November  1 and no later than November 30 to be effective as of January 1 of the
next  year.  Repurchases  shall  be  made once each year as of January 1 and are
subject  to  the  limitation that the Company is not required to repurchase more
than  $100,000  principal  amount  of  each  maturity in any calendar year, on a
non-cumulative  basis.  The  Company will repurchase Debentures on a first-come,
first-served  basis.

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

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

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

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

                                       C-3
<PAGE>
          12.  Defaults  and  Remedies.  The Indenture provides that the Trustee
               -----------------------
90  days  after  the  occurrence  of  an  Event  of  Default  (as defined in the
Indenture),  or  as  soon  as practicable after it learns of an Event of Default
which  occurred  more than 90 days beforehand; provided that, except in the case
of  Default  in the payment of principal of or interest on any of the Debentures
or  any  amount due on redemption, the Trustee may withhold such notice if it in
good  faith determines that the withholding of such notice is in the interest of
the  Debentureholders. In case an Event of Default occurs and is continuing, the
Trustee or the holders of not less than 25% of aggregate principal amount of the
Debentures  then  outstanding,  by  notice in writing to the Company (and to the
Trustee  if given by the Debentureholders), may declare the principal of and all
accrued  interest  on all the Debentures to be due and payable immediately. Such
declaration may be rescinded by holders of a majority in principal amount of the
Debentures  if all existing Events of Default (except nonpayment of principal or
interest that has become due solely because of the acceleration) have been cured
or  waived and if the rescission would not conflict with any judgment or decree.
The  Indenture requires the Company to file periodic reports with the Trustee as
to  the  absence  of  defaults.

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

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

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

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

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

                                       C-4
<PAGE>
     The  Company  will  furnish to any Debentureholder upon written request and
without  charge  a  copy  of  the  Indenture.  Requests may be made to Intervest
Mortgage  Corporation,  One  Rockefeller  Plaza,  Suite  400, New York, New York
10020-2002.

                                       C-5
<PAGE>
If  you  want  to  assign  this  Debenture, fill in the form below and have your
signature  guaranteed  by a commercial bank or trust company or a member firm of
any national securities exchange registered under the Securities Exchange Act of
1934.

I  or  we  assign  and  transfer  this  Debenture  to

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

______________________________________________

______________________________________________

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

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

Date:     _____________________  Your  signature:_____________________________

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

Signature Guarantee: ___________________________

                                       C-6
<PAGE>
                                                                       Exhibit D
                                                                       ---------

         (FORM OF QUARTERLY PAYMENT DEBENTURE MATURING JANUARY 1, 2008)
Number  R(6704/08)-          $

                         INTERVEST MORTGAGE CORPORATION
            Series 6/7/04 Subordinated Debenture due January 1, 2008

     INTERVEST  MORTGAGE  CORPORATION, a corporation duly organized and existing
under  the  laws of the State of New York (the "Company"), promises to pay to or
registered assigns the principal sum of ________________________________________
Dollars  on  January  1,  2008,  together  with  interest at six and one quarter
percent  (6  1/4%) per annum. The provisions on the back of this certificate are
incorporated  as  if  set  forth  on  the  face  of  the  certificate.

                                          Interest Payment Dates:
                                          The first day of each calendar quarter

                                          Record  Dates:
                                          first day of the third month
                                          of the calendar quarter

DATED:

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

THE BANK OF NEW YORK, as                  INTERVEST MORTGAGE CORPORATION
  Registrar

By: _______________________ (Seal)        By:___________________________
     Authorized  Signatory                          President

                                          By: __________________________
                                                    Secretary

                                       D-1
<PAGE>
                             (REVERSE OF DEBENTURE)

            Series 6/7/04 Subordinated Debenture due January 1, 2008

     1.  Interest.  The Company promises to pay interest on the principal amount
         --------
of  this  Debenture  at  the  rate  per  annum shown above. The Company will pay
interest  quarterly  on  January  1, April 1, July 1 and October 1 of each year.
With respect to Debentures sold on the date $9,500,000 or more of Debentures are
first  approved for issuance (the "First Closing Date"), interest will accrue on
principal from the First Closing Date. With respect to Debentures sold after the
First  Closing  Date,  interest will accrue on principal commencing on the first
day  of  the  month of sale, if the Debenture is sold on or before the fifteenth
day  of  the  month, or commencing on the sixteenth day of the month of sale, if
the  Debenture  is  sold  after  the  fifteenth  day of the month, provided that
interest  shall not accrue from prior to the First Closing Date. Debentures sold
after the First Closing Date shall be deemed sold on the date the Company (or an
underwriter  on  its  behalf)  receives  payment  therefor. The first payment of
interest  shall be due on the first day of the second calendar quarter following
the  date of sale of the Debenture, or such earlier date selected by the Company
without  requirement  of  notice  After  the first payment date, interest on the
Debenture will accrue from the most recent date to which interest has been paid.
Interest  accrues  from the date of closing and interest will be computed on the
basis  of  a  360  day  year  consisting  of  twelve  30-day  months.

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

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

     4.  Indenture.  This  Debenture  is  one  of  a  duly  authorized series of
         ---------
Debentures  issued  by  the  Company under an Indenture dated as of June 1, 2004
(the  "Indenture") between the Company and The Bank of New York, as trustee (the
"Trustee").  The term "Debentures" being used herein refers to all Maturities of
Debentures  issued  under  the  Indenture.  Capitalized terms herein are used as
defined in the Indenture unless otherwise indicated. Reference is hereby made to
the  Indenture  for  a  description  of  the  rights,  obligations,  duties  and
immunities  of  the  Trustee  and  the  Debentureholders  and  for the terms and
conditions  upon  which  the Debentures are and are to be issued. The Debentures
are  general  unsecured  obligations  of  the  Company  limited to the aggregate
principal  amount  of  $11,500,000, of which a maximum of $2,500,000 will have a
maturity  date  of January 1, 2008, a maximum of $4,000,000 will have a maturity
date  of  January 1, 2010, and a maximum of $5,000,000 will have a maturity date
of  January  1,  2012.

     5. Optional Redemption. The Company may at its option redeem the Debentures
        --------------------
of  any  CUSIP  Number  in whole or in part at any time. The redemption price of
Debentures will be equal to (i) the face amount of the Debentures to be redeemed
plus  a 1% premium if the redemption date is prior to July 1, 2005, and (ii) the
face  amount  of  the  Debentures to be redeemed if the redemption date is on or
after  July  1,  2005.  In  all  cases,  the  Debenture holder will also receive
interest  accrued  to  the  redemption  date.

                                       D-2
<PAGE>
     6.  Selection  and Notice of Redemption. If less than all of the Debentures
         --------------------------------------
of  any  CUSIP  Number  are  to  be  redeemed,  the  Registrar  shall select the
Debentures  to  be  redeemed by such method as the Registrar shall deem fair and
appropriate,  or if the Debentures are listed on a national securities exchange,
in  accordance  with  the  rules  of such exchange. The Registrar shall make the
selection  from  the  Debentures  outstanding  and  not  previously  called  for
redemption.  The  Registrar may select for redemption portions (equal to $10,000
or  any  integral  multiple  thereof) of the principal amount of Debentures that
have  denominations  larger than $10,000. Provisions of the Indenture that apply
to  Debentures called for redemption also apply to portions of Debentures called
for  redemption.  Notice  of  redemption will be mailed at least 30 days but not
more  than 90 days before the redemption date to each holder of Debentures to be
redeemed  at  his registered address. On and after the redemption date, which is
the  date  specified  by the Company in its notice, interest ceases to accrue on
Debentures  or  portions  thereof  called  for  redemption.

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

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

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

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

     11.  Defaults  and  Remedies.  The Indenture provides that the Trustee will
          -----------------------
give  the  Debentureholders  notice of an uncured Default known to it, within 90
days  after the occurrence of an Event of Default (as defined in the Indenture),
or  as soon as practicable after it learns of an Event of Default which occurred
more  than  90  days beforehand; provided that, except in the case of Default in
the  payment  of principal of or interest on any of the Debentures or any amount
due  on  redemption,  the  Trustee  may withhold such notice if it in good faith
determines  that  the  withholding  of  such  notice  is  in

                                       D-3
<PAGE>
the interest of the Debentureholders.  In case an Event of Default occurs and is
continuing,  the  Trustee  or  the  holders  of  not  less than 25% of aggregate
principal amount of the Debentures then outstanding, by notice in writing to the
Company  (and  to the Trustee if given by the Debentureholders), may declare the
principal  of  and  all  accrued  interest  on  all the Debentures to be due and
payable immediately.  Such declaration may be rescinded by holders of a majority
in  principal amount of the Debentures if all existing Events of Default (except
nonpayment  of  principal  or interest that has become due solely because of the
acceleration) have been cured or waived and if the rescission would not conflict
with  any  judgment  or  decree.  The  Indenture  requires  the  Company to file
periodic  reports  with  the  Trustee  as  to  the  absence  of  defaults.

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

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

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

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

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

     The  Company  will  furnish to any Debentureholder upon written request and
without  charge  a  copy  of  the  Indenture.  Requests may be made to Intervest
Mortgage  Corporation,  One  Rockefeller  Plaza,  Suite  400, New York, New York
10020-2002.

                                       D-4
<PAGE>
                                   ASSIGNMENT

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

I  or  we  assign  and  transfer  this  Debenture  to

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

______________________________________________

______________________________________________

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

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

Date:     _____________________  Your  signature:_____________________________

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

Signature Guarantee: ___________________________

                                       D-5
<PAGE>
                                                                       Exhibit E
                                                                       ---------

         (FORM OF QUARTERLY PAYMENT DEBENTURE MATURING JANUARY 1, 2010)
Number  R(6704/10)-          $

                         INTERVEST MORTGAGE CORPORATION
            Series 6/7/04 Subordinated Debenture due January 1, 2010

     INTERVEST  MORTGAGE  CORPORATION, a corporation duly organized and existing
under  the  laws of the State of New York (the "Company"), promises to pay to or
registered assigns the principal sum of ________________________________________
Dollars  on  January  1,  2010,  together  with  interest at six and one quarter
percent  (6  1/2%) per annum. The provisions on the back of this certificate are
incorporated  as  if  set  forth  on  the  face  of  the  certificate.

                                          Interest Payment Dates:
                                          The first day of each calendar quarter

                                          Record  Dates:
                                          first day of the third month
                                          of the calendar quarter

DATED:

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

THE BANK OF NEW YORK, as                  INTERVEST MORTGAGE CORPORATION
  Registrar

By: _______________________ (Seal)        By:___________________________
     Authorized  Signatory                          President

                                          By: __________________________
                                                    Secretary

                                       E-1
<PAGE>
                             (REVERSE OF DEBENTURE)

            Series 6/7/04 Subordinated Debenture due January 1, 2010

     1.  Interest.  The Company promises to pay interest on the principal amount
         --------
of  this  Debenture  at  the  rate  per  annum shown above. The Company will pay
interest  quarterly  on  January  1, April 1, July 1 and October 1 of each year.
With respect to Debentures sold on the date $9,500,000 or more of Debentures are
first  approved for issuance (the "First Closing Date"), interest will accrue on
principal from the First Closing Date. With respect to Debentures sold after the
First  Closing  Date,  interest will accrue on principal commencing on the first
day  of  the  month of sale, if the Debenture is sold on or before the fifteenth
day  of  the  month, or commencing on the sixteenth day of the month of sale, if
the  Debenture  is  sold  after  the  fifteenth  day of the month, provided that
interest  shall not accrue from prior to the First Closing Date. Debentures sold
after the First Closing Date shall be deemed sold on the date the Company (or an
underwriter  on  its  behalf)  receives  payment  therefor. The first payment of
interest  shall be due on the first day of the second calendar quarter following
the  date of sale of the Debenture, or such earlier date selected by the Company
without  requirement  of  notice  After  the first payment date, interest on the
Debenture will accrue from the most recent date to which interest has been paid.
Interest  accrues  from the date of closing and interest will be computed on the
basis  of  a  360  day  year  consisting  of  twelve  30-day  months.

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

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

     4.  Indenture.  This  Debenture  is  one  of  a  duly  authorized series of
         ---------
Debentures  issued  by  the  Company under an Indenture dated as of June 1, 2004
(the  "Indenture") between the Company and The Bank of New York, as trustee (the
"Trustee").  The term "Debentures" being used herein refers to all Maturities of
Debentures  issued  under  the  Indenture.  Capitalized terms herein are used as
defined in the Indenture unless otherwise indicated. Reference is hereby made to
the  Indenture  for  a  description  of  the  rights,  obligations,  duties  and
immunities  of  the  Trustee  and  the  Debentureholders  and  for the terms and
conditions  upon  which  the Debentures are and are to be issued. The Debentures
are  general  unsecured  obligations  of  the  Company  limited to the aggregate
principal  amount  of  $11,500,000, of which a maximum of $2,500,000 will have a
maturity  date  of January 1, 2008, a maximum of $4,000,000 will have a maturity
date  of  January 1, 2010, and a maximum of $5,000,000 will have a maturity date
of  January  1,  2012.

     5. Optional Redemption. The Company may at its option redeem the Debentures
        --------------------
of  any  CUSIP  Number in whole or in part at any time. The redemption price for
Debentures will be equal to (i) the face amount of the Debentures to be redeemed
plus  a 1% premium if the redemption date is prior to July 1, 2005, and (ii) the
face  amount  of  the  Debentures to be redeemed if the redemption date is on or
after  July  1,  2005.  In  all  cases,  the  Debenture holder will also receive
interest  accrued  to  the  redemption  date.

                                       E-2
<PAGE>
     6.  Selection  and Notice of Redemption. If less than all of the Debentures
         --------------------------------------
of  any  CUSIP  Number  are  to  be  redeemed,  the  Registrar  shall select the
Debentures  to  be  redeemed by such method as the Registrar shall deem fair and
appropriate,  or if the Debentures are listed on a national securities exchange,
in  accordance  with  the  rules  of such exchange. The Registrar shall make the
selection  from  the  Debentures  outstanding  and  not  previously  called  for
redemption.  The  Registrar may select for redemption portions (equal to $10,000
or  any  integral  multiple  thereof) of the principal amount of Debentures that
have  denominations  larger than $10,000. Provisions of the Indenture that apply
to  Debentures called for redemption also apply to portions of Debentures called
for  redemption.  Notice  of  redemption will be mailed at least 30 days but not
more  than 90 days before the redemption date to each holder of Debentures to be
redeemed  at  his registered address. On and after the redemption date, which is
the  date  specified  by the Company in its notice, interest ceases to accrue on
Debentures  or  portions  thereof  called  for  redemption.

     7.  Optional Repurchase. Commencing in 2007 (for a repurchase to be made on
         --------------------
January  1,  2008),  a  holder  will  have  the option to require the Company to
repurchase  the  Debenture  for  the face amount plus accrued interest, provided
that  a  request  for repurchase, accompanied by the Debenture and a written and
duly executed instrument of transfer is submitted to the Company no earlier than
November  1 and no later than November 30 to be effective as of January 1 of the
next  year.  Repurchases  shall  be  made once each year as of January 1 and are
subject  to  the  limitation that the Company is not required to repurchase more
than  $100,000  principal  amount  of  each  maturity in any calendar year, on a
non-cumulative  basis.  The  Company will repurchase Debentures on a first-come,
first-served  basis.

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

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

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

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

                                       E-3
<PAGE>
     12.  Defaults  and  Remedies.  The Indenture provides that the Trustee will
          -----------------------
give  the  Debentureholders  notice of an uncured Default known to it, within 90
days  after the occurrence of an Event of Default (as defined in the Indenture),
or  as soon as practicable after it learns of an Event of Default which occurred
more  than  90  days beforehand; provided that, except in the case of Default in
the  payment  of principal of or interest on any of the Debentures or any amount
due  on  redemption,  the  Trustee  may withhold such notice if it in good faith
determines  that  the  withholding  of  such  notice  is  in the interest of the
Debentureholders.  In  case  an  Event  of Default occurs and is continuing, the
Trustee or the holders of not less than 25% of aggregate principal amount of the
Debentures  then  outstanding,  by  notice in writing to the Company (and to the
Trustee  if given by the Debentureholders), may declare the principal of and all
accrued  interest  on all the Debentures to be due and payable immediately. Such
declaration may be rescinded by holders of a majority in principal amount of the
Debentures  if all existing Events of Default (except nonpayment of principal or
interest that has become due solely because of the acceleration) have been cured
or  waived and if the rescission would not conflict with any judgment or decree.
The  Indenture requires the Company to file periodic reports with the Trustee as
to  the  absence  of  defaults.

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

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

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

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

                                       E-4
<PAGE>
     17.  Abbreviations.  Customary abbreviations may be used in the name of the
          -------------
Debentureholder  or  an assignee, such as: TEN COM (=tenants in common), TEN ENT
(=tenants  by  entirety),  JT TEN (=joint tenants with right of survivorship and
not  as  tenants  in  common), CUST (=custodian), and U/G/M/A (=Uniform Gifts to
Minors  Act).

     The  Company  will  furnish to any Debentureholder upon written request and
without  charge  a  copy  of  the  Indenture.  Requests may be made to Intervest
Mortgage  Corporation,  One  Rockefeller  Plaza,  Suite  400, New York, New York
10020-2002.

                                       E-5
<PAGE>
                                   ASSIGNMENT

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

I  or  we  assign  and  transfer  this  Debenture  to

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

______________________________________________

______________________________________________

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

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

Date:     _____________________  Your  signature:_____________________________

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

Signature Guarantee: ___________________________

                                       E-6
<PAGE>
                                                                       Exhibit F
                                                                       ---------

         (FORM OF QUARTERLY PAYMENT DEBENTURE MATURING JANUARY 1, 2012)
Number  R(6704/12)-          $

                         INTERVEST MORTGAGE CORPORATION
            Series 6/7/04 Subordinated Debenture due January 1, 2012

     INTERVEST  MORTGAGE  CORPORATION, a corporation duly organized and existing
under  the  laws of the State of New York (the "Company"), promises to pay to or
registered assigns the principal sum of ________________________________________
Dollars  on  January  1,  2012,  together  with  interest at six and one quarter
percent  (6  3/4%) per annum. The provisions on the back of this certificate are
incorporated  as  if  set  forth  on  the  face  of  the  certificate.

                                          Interest Payment Dates:
                                          The first day of each calendar quarter

                                          Record  Dates:
                                          first day of the third month
                                          of the calendar quarter

DATED:

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

THE BANK OF NEW YORK, as                  INTERVEST MORTGAGE CORPORATION
Registrar

By: _______________________ (Seal)        By:___________________________
     Authorized  Signatory                          President

                                          By: __________________________
                                                    Secretary

                                       F-1
<PAGE>
                             (REVERSE OF DEBENTURE)

            Series 6/7/04 Subordinated Debenture due January 1, 2012

     1.  Interest.  The Company promises to pay interest on the principal amount
         --------
of  this  Debenture  at  the  rate  per  annum shown above. The Company will pay
interest  quarterly  on  January  1, April 1, July 1 and October 1 of each year.
With respect to Debentures sold on the date $9,500,000 or more of Debentures are
first  approved for issuance (the "First Closing Date"), interest will accrue on
principal from the First Closing Date. With respect to Debentures sold after the
First  Closing  Date,  interest will accrue on principal commencing on the first
day  of  the  month of sale, if the Debenture is sold on or before the fifteenth
day  of  the  month, or commencing on the sixteenth day of the month of sale, if
the  Debenture  is  sold  after  the  fifteenth  day of the month, provided that
interest  shall not accrue from prior to the First Closing Date. Debentures sold
after the First Closing Date shall be deemed sold on the date the Company (or an
underwriter  on  its  behalf)  receives  payment  therefor. The first payment of
interest  shall be due on the first day of the second calendar quarter following
the  date of sale of the Debenture, or such earlier date selected by the Company
without  requirement  of  notice  After  the first payment date, interest on the
Debenture will accrue from the most recent date to which interest has been paid.
Interest  accrues  from the date of closing and interest will be computed on the
basis  of  a  360  day  year  consisting  of  twelve  30-day  months.

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

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

     4.  Indenture.  This  Debenture  is  one  of  a  duly  authorized series of
         ---------
Debentures  issued  by  the  Company under an Indenture dated as of June 1, 2004
(the  "Indenture") between the Company and The Bank of New York, as trustee (the
"Trustee").  The term "Debentures" being used herein refers to all Maturities of
Debentures  issued  under  the  Indenture.  Capitalized terms herein are used as
defined in the Indenture unless otherwise indicated. Reference is hereby made to
the  Indenture  for  a  description  of  the  rights,  obligations,  duties  and
immunities  of  the  Trustee  and  the  Debentureholders  and  for the terms and
conditions  upon  which  the Debentures are and are to be issued. The Debentures
are  general  unsecured  obligations  of  the  Company  limited to the aggregate
principal  amount  of  $11,500,000, of which a maximum of $2,500,000 will have a
maturity  date  of January 1, 2008, a maximum of $4,000,000 will have a maturity
date of January 1, 2010 and a maximum of $5,000,000 will have a maturity date of
January  1,  2012.

     5. Optional Redemption. The Company may at its option redeem the Debentures
        --------------------
of  any  CUSIP  Number in whole or in part at any time. The redemption price for
Debentures  will  be  equal  to:  (i)  the  face  amount of the Debentures to be
redeemed  plus a 1% premium if the redemption date is prior to July 1, 2005, and
(ii)  the face amount of the Debentures to be redeemed if the redemption date is
on  or  after July 1, 2005. In all cases, the Debenture holder will also receive
interest  accrued  to  the  redemption  date.

                                       F-2
<PAGE>
     6.  Selection  and Notice of Redemption. If less than all of the Debentures
         -----------------------------------
of  any  CUSIP  Number  are  to  be  redeemed,  the  Registrar  shall select the
Debentures  to  be  redeemed by such method as the Registrar shall deem fair and
appropriate,  or if the Debentures are listed on a national securities exchange,
in  accordance  with  the  rules  of such exchange. The Registrar shall make the
selection  from  the  Debentures  outstanding  and  not  previously  called  for
redemption.  The  Registrar may select for redemption portions (equal to $10,000
or  any  integral  multiple  thereof) of the principal amount of Debentures that
have  denominations  larger than $10,000. Provisions of the Indenture that apply
to  Debentures called for redemption also apply to portions of Debentures called
for  redemption.  Notice  of  redemption will be mailed at least 30 days but not
more  than 90 days before the redemption date to each holder of Debentures to be
redeemed  at  his registered address. On and after the redemption date, which is
the  date  specified  by the Company in its notice, interest ceases to accrue on
Debentures  or  portions  thereof  called  for  redemption.

     7.  Optional  Repurchase.  Commencing in 2007 (for a purchase to be made on
         --------------------
January  1,  2008),  a  holder  will  have  the option to require the Company to
repurchase  the  Debenture  for  the face amount plus accrued interest, provided
that  a  request  for repurchase, accompanied by the Debenture and a written and
duly executed instrument of transfer is submitted to the Company no earlier than
November  1 and no later than November 30 to be effective as of January 1 of the
next  year.  Repurchases  shall  be  made once each year as of January 1 and are
subject  to  the  limitation that the Company is not required to repurchase more
than  $100,000  principal  amount  of  each  maturity in any calendar year, on a
non-cumulative  basis.  The  Company will repurchase Debentures on a first-come,
first-served  basis.

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

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

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

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

                                      F -3
<PAGE>
     12 Defaults and Remedies. The Indenture provides that the Trustee will give
        ---------------------
the  Debentureholders  notice  of an uncured Default known to it, within 90 days
after the occurrence of an Event of Default (as defined in the Indenture), or as
soon  as  practicable after it learns of an Event of Default which occurred more
than  90  days  beforehand;  provided that, except in the case of Default in the
payment  of  principal of or interest on any of the Debentures or any amount due
on  redemption,  the  Trustee  may  withhold  such  notice  if  it in good faith
determines  that  the  withholding  of  such  notice  is  in the interest of the
Debentureholders.  In  case  an  Event  of Default occurs and is continuing, the
Trustee or the holders of not less than 25% of aggregate principal amount of the
Debentures  then  outstanding,  by  notice in writing to the Company (and to the
Trustee  if given by the Debentureholders), may declare the principal of and all
accrued  interest  on all the Debentures to be due and payable immediately. Such
declaration may be rescinded by holders of a majority in principal amount of the
Debentures  if all existing Events of Default (except nonpayment of principal or
interest that has become due solely because of the acceleration) have been cured
or  waived and if the rescission would not conflict with any judgment or decree.
The  Indenture requires the Company to file periodic reports with the Trustee as
to  the  absence  of  defaults.

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

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

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

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

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

     The  Company  will  furnish to any Debentureholder upon written request and
without  charge  a  copy  of  the  Indenture.  Requests may be made to Intervest
Mortgage  Corporation,  One  Rockefeller  Plaza,  Suite  400, New York, New York
10020-2002.

                                      F -4
<PAGE>
                                   ASSIGNMENT

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

I  or  we  assign  and  transfer  this  Debenture  to

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

______________________________________________

______________________________________________

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

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

Date:     _____________________  Your  signature:_____________________________

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

Signature Guarantee: ___________________________

                                      F -5AMENDMENT TO EMPLOYMENT AGREEMENT

     Amendment  made  as  of  the  1st  day of July, 2004, by and between Jerome
Dansker  ("Dansker")  and  Intervest  Mortgage  Corporation  (formerly  known as
Intervest  Corporation of New York), a New York corporation (the "Corporation").

     WHEREAS, Dansker and the Corporation are parties to that certain Employment
Agreement  dated as of July 1, 1995, as amended on August 3, 1998 (the "Original
Employment  Agreement"),  and

     WHEREAS,  the  parties  are  desirous  of  amending the Original Employment
Agreement  so  as  to  extend  the  term  thereof,

     NOW,  THEREFORE,  the  parties  agree  as  follows:

1. DEFINED TERMS. Capitalized terms used herein shall have the meanings ascribed
to  them  in  the  Original  Employment  Agreement.

2.  AMENDMENT.  Section 4 of the Original Employment Agreement is hereby deleted
and  the  following  is  substituted  in  its  place:  "Term.  The  term of this
                                                        ----
Employment Agreement (the "Term") shall commence on the effective date and shall
expire  June  30, 2014, unless terminated by Dansker upon thirty (30) days prior
notice  (in which case the respective obligations of the parties hereunder shall
terminate  upon  the payment of accrued entitlements and which termination shall
not  include  Dansker's  death,  disability  or  retirement)."

3.  SCOPE. Except as expressly amended hereby, the Original Employment Agreement
shall  remain  in  full  force  and  effect  in  accordance  with  its  terms.

     IN  WITNESS  WHEREOF, the parties have executed this Amendment effective as
of  the  date  first  written  above.

                                      INTERVEST  MORTGAGE  CORPORATION

                                      /s/ Lowell S. Dansker
                                      By: Lowell S. Dansker
                                      Its: President

                                      /s/ Jerome Dansker
                                      JEROME  DANSKER

<PAGE>

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