Document:

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                                                                     EXHIBIT 4.9
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                            DYNEGY CAPITAL TRUST III

                                     FORM OF

                    AMENDED AND RESTATED DECLARATION OF TRUST

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                         Dated as of __________, ______
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                                TABLE OF CONTENTS

                                    ARTICLE I
                         DEFINITIONS AND INTERPRETATION
<TABLE>
<S>                                                                           <C>
SECTION 1.1       Definitions................................................  1

                                   ARTICLE II
                               TRUST INDENTURE ACT

SECTION 2.1       Trust Indenture Act; Application...........................  7
SECTION 2.2       Lists of Holders of Securities.............................  7
SECTION 2.3       Reports by the Property Trustee............................  8
SECTION 2.4       Periodic Reports to Property Trustee.......................  8
SECTION 2.5       Evidence of Compliance with Conditions Precedent...........  8
SECTION 2.6       Events of Default; Waiver..................................  8
SECTION 2.7       Event of Default; Notice................................... 10

                                   ARTICLE III
                                  ORGANIZATION

SECTION 3.1       Name....................................................... 10
SECTION 3.2       Office..................................................... 10
SECTION 3.3       Purpose.................................................... 11
SECTION 3.4       Authority.................................................. 11
SECTION 3.5       Title to Property of the Trust............................. 11
SECTION 3.6       Powers and Duties of the Administrative Trustees........... 11
SECTION 3.7       Prohibition on Actions by the Trust and the Trustees....... 14
SECTION 3.8       Powers and Duties of the Property Trustee.................. 15
SECTION 3.9       Certain Duties and Responsibilities of the Property
                   Trustee................................................... 17
SECTION 3.10      Certain Rights of Property Trustee......................... 18
SECTION 3.11      Delaware Trustee........................................... 20
SECTION 3.12      Execution of Documents..................................... 20
SECTION 3.13      Not Responsible for Recitals or Issuance of Securities..... 20
SECTION 3.14      Duration of Trust.......................................... 20
SECTION 3.15      Mergers.................................................... 21

                                   ARTICLE IV
                                     SPONSOR

SECTION 4.1       Sponsor's Purchase of Common Securities.................... 22
SECTION 4.2       Responsibilities of the Sponsor............................ 22
SECTION 4.3       Right to Proceed........................................... 23
</TABLE>
                                    ARTICLE V
                                    TRUSTEES

                                       -i-
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<TABLE>
<S>                                                                           <C>
SECTION 5.1       Number of Trustees; Appointment of Co-Trustee.............. 23
SECTION 5.2       Delaware Trustee........................................... 24
SECTION 5.3       Property Trustee; Eligibility.............................. 24
SECTION 5.4       Certain Qualifications of Administrative Trustees and
                  Delaware Trustee Generally................................. 25
SECTION 5.5       Administrative Trustees.................................... 25
SECTION 5.6       Delaware Trustee........................................... 25
SECTION 5.7       Appointment, Removal and Resignation of Trustees........... 26
SECTION 5.8       Vacancies Among Trustees................................... 27
SECTION 5.9       Effect of Vacancies........................................ 27
SECTION 5.10      Meetings................................................... 28
SECTION 5.11      Delegation of Power........................................ 28
SECTION 5.12      Merger, Conversion, Consolidation or Succession to
                  Business................................................... 28

                                   ARTICLE VI
                                  DISTRIBUTIONS

SECTION 6.1       Distributions.............................................. 29

                                   ARTICLE VII
                             ISSUANCE OF SECURITIES

SECTION 7.1       General Provisions Regarding Securities.................... 29
SECTION 7.2       Execution and Authentication............................... 30
SECTION 7.3       Form and Dating............................................ 30
SECTION 7.4       Registrar and Paying Agent [and Conversion Agent].......... 31
SECTION 7.5       Paying Agent to Hold Money in Trust........................ 32
SECTION 7.6       Replacement Securities..................................... 32
SECTION 7.7       Outstanding Preferred Securities........................... 33
SECTION 7.8       Preferred Securities in Treasury........................... 33
SECTION 7.9       Temporary Securities....................................... 33
SECTION 7.10      Exchange................................................... 34
SECTION 7.11      Cancellation............................................... 35
SECTION 7.12      CUSIP Numbers.............................................. 35

                                  ARTICLE VIII
                              DISSOLUTION OF TRUST

SECTION 8.1       Dissolution of Trust....................................... 35

                                   ARTICLE IX
                              TRANSFER OF INTERESTS

SECTION 9.1       Transfer of Securities..................................... 36
SECTION 9.2       Transfer Procedures and Restrictions....................... 37
SECTION 9.3       Deemed Security Holders.................................... 38
</TABLE>
                                      -ii-
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<TABLE>
<S>                                                                          <C>
SECTION 9.4       Book Entry Interests....................................... 38
SECTION 9.5       Notices to Clearing Agency................................. 38
SECTION 9.6       Appointment of Successor Clearing Agency................... 39

                                    ARTICLE X
                           LIMITATION OF LIABILITY OF
                   HOLDERS OF SECURITIES, TRUSTEES AND OTHERS

SECTION 10.1      Liability.................................................. 39
SECTION 10.2      Exculpation................................................ 39
SECTION 10.3      Fiduciary Duty............................................. 40
SECTION 10.4      Indemnification............................................ 40
SECTION 10.5      Outside Businesses......................................... 43
SECTION 10.6      Compensation; Fees......................................... 43

                                   ARTICLE XI
                                   ACCOUNTING

SECTION 11.1      Fiscal Year................................................ 44
SECTION 11.2      Certain Accounting Matters................................. 44
SECTION 11.3      Banking.................................................... 44
SECTION 11.4      Withholding................................................ 44

                                   ARTICLE XII
                             AMENDMENTS AND MEETINGS

SECTION 12.1      Amendments................................................. 45
SECTION 12.2      Meetings of the Holders; Action by Written Consent......... 46

                                  ARTICLE XIII
                       REPRESENTATIONS OF PROPERTY TRUSTEE
                              AND DELAWARE TRUSTEE

SECTION 13.1      Representations and Warranties of Property Trustee......... 47
SECTION 13.2      Representations and Warranties of Delaware Trustee......... 48

                                   ARTICLE XIV
                                  MISCELLANEOUS

SECTION 14.1      Notices.................................................... 49
SECTION 14.2      Governing Law.............................................. 50
SECTION 14.3      Intention of the Parties................................... 51
SECTION 14.4      Headings................................................... 51
SECTION 14.5      Successors and Assigns..................................... 51
SECTION 14.6      Partial Enforceability..................................... 51
SECTION 14.7      Counterparts............................................... 51
SECTION 14.8      No Recourse................................................ 51
</TABLE>
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                                      -iv-
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                                   SECTION OF
                          TRUST INDENTURE ACT OF 1939,             SECTON OF
                                   AS AMENDED                     DECLARATION
<TABLE>
<S>                                                               <C>
310(a)..........................................................  5.3
310(b)..........................................................  5.3(c), 5.3(d)
311(a)..........................................................  2.2(b)
311(b)..........................................................  2.2(b)
312(a)..........................................................  2.2(a)
312(b)..........................................................  2.2(b)
313.............................................................  2.3
314(a)..........................................................  2.4; 3.6(j)
314(c)..........................................................  2.5
315(a)..........................................................  3.9
315(b)..........................................................  2.7(a)
315(c)..........................................................  3.9(a)
315(d)..........................................................  3.9(b)
316(a)..........................................................  2.6
316(c)..........................................................  3.6(e)
317(a)..........................................................  3.8(e); 3.8(h)
317(b)..........................................................  3.8(i); 7.5
</TABLE>

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*This Cross-Reference Table does not constitute part of the Declaration of Trust
and shall not affect the interpretation of any of its terms or provisions.

                                       -v-
<PAGE>

                          FORM OF AMENDED AND RESTATED

                              DECLARATION OF TRUST

                                       OF

                            DYNEGY CAPITAL TRUST III

         AMENDED AND RESTATED DECLARATION OF TRUST (this "Declaration") dated
and effective as of _______, ___, by the Trustees (as defined herein), the
Sponsor (as defined herein) and by the holders, from time to time, of undivided
beneficial interests in the assets of the Trust to be issued pursuant to this
Declaration.

         WHEREAS, certain of the Trustees and the Sponsor established Dynegy
Capital Trust III (the "Trust"), a trust created under the Delaware Business
Trust Act pursuant to a Declaration of Trust dated as of February 1, 2000 (the
"Original Declaration") and a Certificate of Trust filed with the Secretary of
State of the State of Delaware on February 2, 2000, for the sole purpose of
issuing and selling certain securities representing undivided beneficial
interests in the assets of the Trust and investing the proceeds thereof in
certain Debentures of the Debenture Issuer (each as hereinafter defined), and
engaging in only those other activities necessary, advisable or incidental
thereto; and

         WHEREAS, the parties hereto, by this Declaration, amend and restate
each and every term and provision of the Original Declaration;

         NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a statutory business trust under the Business Trust Act
and that this Declaration constitute the governing instrument of such business
trust, the Trustees declare that all assets contributed to the Trust will be
held in trust for the benefit of the holders, from time to time, of the
securities representing undivided beneficial interests in the assets of the
Trust issued hereunder, subject to the provisions of this Declaration, and the
parties hereto hereby amend and restate each and every term and provision of the
original Declaration as follows:

                                    ARTICLE I
                         DEFINITIONS AND INTERPRETATION

SECTION 1.1       Definitions.

         Unless the context otherwise requires:

         (a)      capitalized terms used in this Declaration but not defined in
the preamble above have the respective meanings assigned to them in this Section
1.1;

         (b)      a term defined anywhere in this Declaration has the same
meaning throughout;

         (c)      all references to "the Declaration" or "this Declaration" are
to this Declaration as modified, supplemented or amended from time to time;
<PAGE>

         (d)      all references in this Declaration to "Articles" and
"Sections" and "Annexes" and "Exhibits" are to Articles and Sections of and
Annexes and Exhibits to this Declaration;

         (e)      a term defined in the Trust Indenture Act has the same meaning
when used in this Declaration unless otherwise defined in this Declaration; and

         (f)      a reference to the singular includes the plural and vice
versa.

         "Administrative Trustee" has the meaning set forth in Section 5.1(b).

         "Affiliate" has the same meaning as given to that term in Rule 405
under the Securities Act or any successor rule thereunder.

         "Agent" means any Paying Agent [,/or] Registrar [or Conversion Agent].

         "Authorized Officer" of a Person means any other Person that is
authorized to legally bind such former Person.

         "Book Entry Interest" means a beneficial interest in a Global Preferred
Security registered in the name of a Clearing Agency or its nominee, ownership
and transfers of which shall be maintained and made through book entries by a
Clearing Agency as described in Section 9.4.

         "Business Day" means any day other than a Saturday or a Sunday or a day
on which banking institutions in New York, New York or Houston, Texas are
authorized or required by law or executive order to close.

         "Business Trust Act" means Chapter 38 of Title 12 of the Delaware Code,
12 Del. Codess.3801 et seq., as it may be amended from time to time, or any
successor legislation.

         "Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as depositary
for the Preferred Securities and in whose name or in the name of a nominee of
that organization shall be registered the Global Preferred Securities and which
shall undertake to effect book entry transfers and pledges of the Preferred
Securities.

         "Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book entry transfers and pledges of securities deposited with the
Clearing Agency.

         "Closing Date" means the ["Time of Delivery"], as such term is defined
in the Underwriting Agreement.

         "Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor legislation.

         "Commission" means the United States Securities and Exchange Commission
as from time to time constituted, or if any time after the execution of this
Declaration such Commission is not

                                       -2-
<PAGE>

existing and performing the duties now assigned to it under applicable federal
securities laws, then the body performing such duties at such time.

         "Common Securities" has the meaning specified in Section 7.1(a).

         "Common Securities Guarantee" means the guarantee agreement dated as of
__________, _____ of the Sponsor in respect of the Common Securities.

         "Common Securities Subscription Agreement" means the subscription
agreement dated as of _____, ___ of the Sponsor in respect of the Common
Securities.

         "Company Indemnified Person" means (a) any Administrative Trustee; (b)
any Affiliate of any Administrative Trustee; (c) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Administrative Trustee; and (d) any officer, employee or agent of the Trust or
its Affiliates.

         ["Conversion Agent" has the meaning set forth in Section 7.4.]

         "Corporate Trust Office" means the office of the Property Trustee at
which the corporate trust business of the Property Trustee shall, at any
particular time, be principally administered, which office at the date of
execution of this Declaration is located at 1 Bank One Plaza, Suite IL1 0126,
Chicago, Illinois 60670-0126.

         "Covered Person" means: (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates; and (b) any Holder of Securities.

         "Debenture Issuer" means Dynegy Inc., a Delaware corporation, or any
successor entity resulting from any consolidation, amalgamation, merger or other
business combination, in its capacity as issuer of the Debentures under the
Indenture.

         "Debenture Subscription Agreement" means the subscription agreement
dated as of _______, __ of the Trust in respect of the Debentures.

         "Debenture Trustee" means Bank One Trust Company, National Association,
a national banking association, as trustee under the Indenture until a successor
is appointed thereunder, and thereafter means such successor trustee.

         "Debentures" means, collectively, the ____% Junior Subordinated
Debentures due ______ issued pursuant to the Indenture.

         "Default" means an event, act or condition that with notice or lapse of
time, or both, would constitute an Event of Default.

         "Definitive Preferred Securities" has the meaning set forth in Section
7.3(e).

         "Delaware Trustee" has the meaning set forth in Section 5.2.

                                       -3-
<PAGE>

         "Direct Action" shall have the meaning set forth in Section 3.8(e).

         "Distribution" means a distribution payable to Holders in accordance
with Section 6.1.

         "DTC" means The Depository Trust Company, the initial Clearing Agency.

         "Event of Default" in respect of the Securities means an Event of
Default (as defined in the Indenture) that has occurred and is continuing in
respect of the Debentures.

         "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.

         "Fiduciary Indemnified Person" has the meaning set forth in Section
10.4(b).

         "Fiscal Year" has the meaning set forth in Section 11.1.

         "Global Preferred Security" has the meaning set forth in Section
7.3(b).

         "Holder" means a Person in whose name a Security is registered, such
Person being a beneficial owner within the meaning of the Business Trust Act.

         "Indemnified Person" means a Company Indemnified Person or a Fiduciary
Indemnified Person.

         "Indenture" means the Indenture dated as of ______, ___, among the
Debenture Issuer and the Debenture Trustee, as amended from time to time.

         "Investment Company" means an investment company as defined in the
Investment Company Act.

         "Investment Company Act" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.

         "Legal Action" has the meaning set forth in Section 3.6(g).

         "Like Amount" has the meaning set forth in Section 3 of Annex I.

         "Liquidation Amount" has the meaning set forth in Section 2(a) of Annex
I.

         "List of Holders" has the meaning set forth in Section 2.2(a).

         "Majority in Liquidation Amount" means, with respect to the Trust
Securities, except as provided in the terms of the Preferred Securities or by
the Trust Indenture Act, Holder(s) of outstanding Trust Securities voting
together as a single class or, as the context may require, Holders of
outstanding Preferred Securities or Holders of outstanding Common Securities
voting separately as a class, who are the record owners of more than 50% of the
aggregate Liquidation Amount of all outstanding Securities of the relevant
class.

                                       -4-
<PAGE>

         "Officers' Certificate" means, with respect to any Person, a
certificate signed by any of the Chairman of the Board, a Vice Chairman of the
Board, the Chief Executive Officer, the President or a Vice President and the
Chief Financial Officer, the Treasurer, an Assistant Treasurer, the Secretary or
an Assistant Secretary of such Person. Any Officers' Certificate delivered by
the Trust shall be signed by at least one Administrative Trustee. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Declaration shall include: (a) a statement that each
officer signing the Officers' Certificate has read the covenant or condition and
the definitions relating thereto; (b) a brief statement of the nature and scope
of the examination or investigation undertaken by each officer in rendering the
Officers' Certificate; (c) a statement that each such officer has made such
examination or investigation as, in such officer's opinion, is necessary to
enable such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and (d) a statement as to whether,
in the opinion of each such officer, such condition or covenant has been
complied with.

         "Opinion of Counsel" means a written opinion of counsel, who may be an
employee of the Sponsor, and who shall be reasonably acceptable to the Property
Trustee.

         "Option Closing Time" means any settlement date with respect to an
over-allotment option to purchase additional Preferred Securities granted to the
underwriters in the Underwriting Agreement.

         "Paying Agent" has the meaning specified in Section 7.4.

         "Payment Amount" has the meaning specified in Section 6.1.

         "Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association or government, or any
agency or political subdivision thereof, or any other entity of whatever nature.

         "Preferred Securities" has the meaning specified in Section 7.1(a).

         "Preferred Securities Guarantee" means the guarantee agreement dated as
of ______, ___, by the Sponsor in respect of Preferred Securities.

         "Preferred Security Beneficial Owner" means, with respect to a Book
Entry Interest, a Person who is the beneficial owner of such Book Entry
Interest, as reflected on the books of the Clearing Agency, or on the books of a
Person maintaining an account with such Clearing Agency (directly as a Clearing
Agency Participant or as an indirect participant, in each case in accordance
with the rules of such Clearing Agency).

         "Property Trustee" has the meaning set forth in Section 5.3(a).

         "Property Trustee Account" has the meaning set forth in Section
3.8(c)(i).

         "Quorum" means a majority of the Administrative Trustees or, if there
are only two Administrative Trustees, both of them.

                                       -5-
<PAGE>

         "Registrar" has the meaning set forth in Section 7.4.

         "Responsible Officer" means any officer within the Corporate Trust
Office of the Property Trustee with direct responsibility for the administration
of this Declaration and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of that
officer's knowledge of and familiarity with the particular subject.

         "Rule 3a-5" means Rule 3a-5 under the Investment Company Act, or any
successor rule or regulation.

         "Securities" or "Trust Securities" means the Common Securities and the
Preferred Securities.

         "Securities Act" means the Securities Act of 1933, as amended from time
to time, or any successor legislation.

         "Securities Guarantees" means the Common Securities Guarantee and the
Preferred Securities Guarantee.

         ["Special Event" has the meaning set forth in Section 4(b) of Annex I
hereto.]

         "Sponsor" means Dynegy Inc., a Delaware corporation, or any successor
entity resulting from any merger, conversion, consolidation, amalgamation or
other business combination, in its capacity as sponsor of the Trust.

         "Sponsor Affiliated Holder" has the meaning set forth in Section
7.10(a).

         "State" means any state of the United States of America and the
District of Columbia.

         "Successor Entity" has the meaning set forth in Section 3.15(b)(i).

         "Successor Property Trustee" has the meaning set forth in Section
3.8(f).

         "Successor Securities" has the meaning set forth in Section 3.15(b)(i).

         "Super Majority" has the meaning set forth in Section 2.6(a)(ii).

         "10% in Liquidation Amount" means, with respect to the Trust
Securities, except as provided in the terms of the Preferred Securities or by
the Trust Indenture Act, Holder(s) of outstanding Trust Securities voting
together as a single class or, as the context may require, Holders of
outstanding Preferred Securities or Holders of outstanding Common Securities
voting separately as a class, who are the record owners of 10% or more of the
aggregate Liquidation Amount of all outstanding Securities of the relevant
class.

         "Treasury Regulations" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).

                                       -6-
<PAGE>

         "Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue as a trustee in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as trustees in accordance with the
provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.

         "Trust Indenture Act" means the Trust Indenture Act of 1939, as amended
from time to time, or any successor legislation.

         "Underwriting Agreement" means the [Underwriting Agreement] dated
_______ among the Sponsor, the Trust, and ___________, as representatives of the
several underwriters named therein relating to the initial offering and sale of
the Preferred Securities.

                                   ARTICLE II
                               TRUST INDENTURE ACT

SECTION 2.1       Trust Indenture Act; Application.

         (a)      This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration in order for this
Declaration to be qualified under the Trust Indenture Act and shall, to the
extent applicable, be governed by such provisions.

         (b)      The Property Trustee shall be the only Trustee that is a
"trustee" for the purposes of the Trust Indenture Act.

         (c)      If and to the extent that any provision of this Declaration
limits, qualifies or conflicts with the duties imposed by ss.ss. 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.

         (d)      The application of the Trust Indenture Act to this Declaration
shall not affect the nature of the Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.

SECTION 2.2       Lists of Holders of Securities.

         (a)      Each of the Sponsor and the Administrative Trustees on behalf
of the Trust shall provide the Property Trustee (unless the Property Trustee is
Registrar for the Securities) (i) within 14 days after each record date for
payment of Distributions, a list, in such form as the Property Trustee may
reasonably require, of the names and addresses of the Holders ("List of
Holders") as of such record date, provided that neither the Sponsor nor the
Administrative Trustees on behalf of the Trust shall be obligated to provide
such List of Holders at any time that the List of Holders does not differ from
the most recent List of Holders given to the Property Trustee by the Sponsor and
the Administrative Trustees on behalf of the Trust; and (ii) at any other time,
within 30 days of receipt by the Trust of a written request for a List of
Holders as of a date no more than 14 days before such List of Holders is given
to the Property Trustee. The Property Trustee shall preserve, in as current a
form as is reasonably practicable, all information contained in Lists of Holders
given to it or which it

                                       -7-
<PAGE>

receives in its capacity as Paying Agent (if acting in such capacity), provided
that the Property Trustee may destroy any List of Holders previously given to it
on receipt of a new List of Holders.

         (b)      The Property Trustee shall comply with its obligations under
ss.ss. 311(a), 311(b) and 312(b) of the Trust Indenture Act.

SECTION 2.3       Reports by the Property Trustee.

         Within 60 days after _______ of each year, commencing _______, ___, the
Property Trustee shall provide to the Holders of the Preferred Securities such
reports as are required by ss. 313 of the Trust Indenture Act, if any, in the
form and in the manner provided by ss. 313 of the Trust Indenture Act. The
Property Trustee shall also comply with the requirements of ss. 313(d) of the
Trust Indenture Act.

SECTION 2.4       Periodic Reports to Property Trustee.

         Each of the Sponsor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee such documents, reports and
information as are required by ss. 314 (if any) of the Trust Indenture Act and
the compliance certificate required by ss. 314 of the Trust Indenture Act in the
form, in the manner and at the times required by ss. 314(a)(4) of the Trust
Indenture Act.

SECTION 2.5       Evidence of Compliance with Conditions Precedent.

         Each of the Sponsor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee such evidence of compliance with any
conditions precedent provided for in this Declaration that relate to any of the
matters set forth in ss. 314(c) of the Trust Indenture Act. Any certificate or
opinion required to be given by an officer pursuant to ss. 314(c)(1) of the
Trust Indenture Act may be given in the form of an Officers' Certificate.

SECTION 2.6       Events of Default; Waiver.

         (a)      The Holders of a Majority in Liquidation Amount of Preferred
Securities may, by vote, on behalf of the Holders of all of the Preferred
Securities, waive any past Default or Event of Default in respect of the
Preferred Securities and its consequences, provided that, if the underlying
Default or Event of Default under the Indenture:

                  (i)      is not waivable under the Indenture, the Default or
Event of Default under this Declaration also shall not be waivable; or

                  (ii)     requires the consent or vote of greater than a
majority in aggregate principal amount of the holders of the Debentures (a
"Super Majority") to be waived under the Indenture, the Default or Event of
Default under this Declaration may only be waived by the vote of the Holders of
at least the proportion in aggregate Liquidation Amount of the Preferred
Securities that the relevant Super Majority represents of the aggregate
principal amount of the Debentures outstanding.

                                       -8-
<PAGE>

The foregoing provisions of this Section 2.6(a) shall be in lieu of ss.
316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the Trust
Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such
default shall cease to exist, and any Event of Default with respect to the
Preferred Securities arising therefrom shall be deemed to have been cured, for
every purpose of this Declaration, but no such waiver shall extend to any
subsequent or other Default or an Event of Default with respect to the Preferred
Securities or impair any right consequent thereon. Any waiver by the Holders of
the Preferred Securities of a Default or an Event of Default with respect to the
Preferred Securities shall also be deemed to constitute a waiver by the Holders
of the Common Securities of any such Default or Event of Default with respect to
the Common Securities for all purposes of this Declaration without any further
act, vote or consent of the Holders of the Common Securities.

         (b)      The Holders of a Majority in Liquidation Amount of the Common
Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Default or Event of Default with respect to the
Common Securities and its consequences, provided that, if the underlying Default
or Event of Default under the Indenture:

                  (i)      is not waivable under the Indenture, except where the
Holders of the Common Securities are deemed to have waived such Default or Event
of Default under the Declaration as provided below in this Section 2.6(b), the
Default or Event of Default under this Declaration also shall not be waivable;
or

                  (ii)     requires the consent or vote of a Super Majority to
be waived, except where the Holders of the Common Securities are deemed to have
waived such Default or Event of Default under the Declaration as provided below
in this Section 2.6(b), the Default or Event of Default under the Declaration
may only be waived by the vote of the Holders of at least the proportion in
aggregate Liquidation Amount of the Common Securities that the relevant Super
Majority represents of the aggregate principal amount of the Debentures
outstanding; provided further that the Holders of Common Securities will be
deemed to have waived any such Event of Default and all Events of Default with
respect to the Common Securities and their consequences until all Events of
Default with respect to the Preferred Securities have been cured, waived or
otherwise eliminated, and until such Events of Default have been so cured,
waived or otherwise eliminated, the Property Trustee will be deemed to be acting
solely on behalf of the Holders of the Preferred Securities and only the Holders
of the Preferred Securities will have the right to direct the Property Trustee
in accordance with the terms of the Securities.

The foregoing provisions of this Section 2.6(b) shall be in lieu of ss.ss.
316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such ss.ss.
316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby expressly
excluded from this Declaration and the Securities, as permitted by the Trust
Indenture Act. Subject to the foregoing provisions of this Section 2.6(b), upon
such waiver, any such default shall cease to exist and any Event of Default with
respect to the Common Securities arising therefrom shall be deemed to have been
cured for every purpose of this Declaration, but no such waiver shall extend to
any subsequent or other Default or Event of Default with respect to the Common
Securities or impair any right consequent thereon.

                                       -9-
<PAGE>

         (c)      A waiver of a Default or an Event of Default under the
Indenture by the Property Trustee, at the direction of the Holders of the
Preferred Securities, constitutes a waiver of the corresponding Default or Event
of Default under this Declaration. The foregoing provisions of this Section
2.6(c) shall be in lieu of ss. 316(a)(1)(B) of the Trust Indenture Act and such
ss. 316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded from
this Declaration and the Securities, as permitted by the Trust Indenture Act.

SECTION 2.7       Event of Default; Notice.

         (a)      The Property Trustee shall, within 90 days after the
occurrence of a Default actually known to a Responsible Officer, transmit by
mail, first class postage prepaid, to the Holders, notices of all such Defaults
with respect to the Securities, unless such Defaults have been cured before the
giving of such notice; provided that, except for a Default in the payment of
principal of (or premium, if any) or interest (including Compounded Interest and
Additional Sums (as such terms are defined in the Indenture), if any) on any of
the Debentures, the Property Trustee shall be protected in withholding such
notice if and so long as a Responsible Officer in good faith determines that the
withholding of such notice is in the interests of the Holders.

         (b)      The Property Trustee shall not be deemed to have knowledge of
any Default except:

                  (i)      a default under Sections 5.01(a) or (b) of the
Indenture; or

                  (ii)     any Default as to which the Property Trustee shall
have received written notice specifying such Default and stating that such
notice is a "Notice of Default" or of which a Responsible Officer charged with
the administration of the Declaration shall have actual knowledge.

         (c)      Within five Business Days after the occurrence of any Event of
Default actually known to the Property Trustee, the Property Trustee shall
transmit notice of such Event of Default to the Holders of the Preferred
Securities, the Administrative Trustees and the Sponsor, unless such Event of
Default shall have been cured or waived. The Sponsor and the Administrative
Trustees shall file annually with the Property Trustee a certification as to
whether or not they are in compliance with all the conditions and covenants
applicable to them under this Declaration.

                                   ARTICLE III
                                  ORGANIZATION

SECTION 3.1       Name.

         The Trust is named "Dynegy Capital Trust III" as such name may be
modified from time to time by the Administrative Trustees following written
notice to the Delaware Trustee, the Property Trustee and the Holders. The
Trust's activities may be conducted under the name of the Trust or any other
name deemed advisable by the Administrative Trustees.

SECTION 3.2       Office.

         The address of the principal office of the Trust is c/o Dynegy Inc.,
1000 Louisiana Street, Suite 5800, Houston, Texas 77002. On ten Business Days
written notice to the Delaware Trustee, the

                                      -10-
<PAGE>

Property Trustee and the Holders of Securities, the Administrative Trustees may
designate another principal office.

SECTION 3.3       Purpose.

         The exclusive purposes and functions of the Trust are (a) to issue and
sell Securities; (b) use the proceeds from the sale of the Securities to acquire
the Debentures; and (c) except as otherwise limited herein, to engage in only
those other activities necessary, advisable or incidental thereto.

SECTION 3.4       Authority.

         Subject to the limitations provided in this Declaration and to the
specific duties of the Property Trustee, the Administrative Trustees shall have
exclusive and complete authority to carry out the purposes of the Trust. An
action taken by the Administrative Trustees in accordance with their powers
shall constitute the act of and serve to bind the Trust and an action taken by
the Property Trustee on behalf of the Trust in accordance with its powers shall
constitute the act of and serve to bind the Trust. In dealing with the Trustees
acting on behalf of the Trust, no Person shall be required to inquire into the
authority of the Trustees to bind the Trust. Persons dealing with the Trust are
entitled to rely conclusively on the power and authority of the Trustees as set
forth in this Declaration.

SECTION 3.5       Title to Property of the Trust.

         Except as provided in Section 3.8 with respect to the Debentures and
the Property Trustee Account or as otherwise provided in this Declaration, legal
title to all assets of the Trust shall be vested in the Trust. The Holders shall
not have legal title to any part of the assets of the Trust, but shall have an
undivided beneficial interest in the assets of the Trust.

SECTION 3.6       Powers and Duties of the Administrative Trustees.

         The Administrative Trustees shall have the exclusive power, duty and
authority to cause the Trust to engage in the following activities:

         (a)      to execute, deliver, issue and sell the Securities in
accordance with this Declaration; provided, however, that except as contemplated
in Section 7.1(a),

                  (i)      the Trust may issue no more than one series of
Preferred Securities and no more than one series of Common Securities,

                  (ii)     there shall be no interests in the Trust other than
the Securities, and

                  (iii)    the issuance of Securities shall be limited to a
simultaneous issuance of both Preferred Securities and Common Securities at the
Closing Date and, if applicable, at any Option Closing Time;

         (b)      in connection with the issue and sale of the Preferred
Securities, at the direction of the Sponsor, to:

                                      -11-
<PAGE>

                  (i)      file with the Commission a registration statement
prepared by the Sponsor on the appropriate form in relation to the Preferred
Securities, including any amendments thereto and including any supplements or
amendments to any form of prospectus included therein, as permitted by the rules
and regulations of the Commission;

                  (ii)     execute and file any documents prepared by the
Sponsor, or take any acts as determined by the Sponsor to be necessary in order
to qualify or register all or part of the Preferred Securities in any state in
which the Sponsor has determined to qualify or register such Preferred
Securities for sale;

                  (iii)    at the direction of the Sponsor, execute and file an
application, prepared by the Sponsor, to the New York Stock Exchange or any
other national stock exchange or the Nasdaq National Market for listing or
quotation of the Preferred Securities;

                  (iv)     to execute and deliver letters, documents or
instruments with DTC and any other Clearing Agencies relating to the Preferred
Securities;

                  (v)      if required, execute and file with the Commission a
registration statement on Form 8-A, including any amendments thereto, prepared
by the Sponsor, relating to the registration of the Preferred Securities under
Section 12(b) or 12(g) of the Exchange Act; and

                  (vi)     to cause the Trust to enter into such agreements and
arrangements as may be necessary or desirable in connection with the sale of
Preferred Securities to the underwriters thereof and the consummation thereof,
and to take all action as may be necessary or desirable in connection with the
consummation thereof;

         (c)      to acquire the Debentures with the proceeds of the sale of the
Preferred Securities and the Common Securities; provided, however, that the
Administrative Trustees shall cause legal title to the Debentures to be held of
record in the name of the Property Trustee for the benefit of the Holders;

         (d)      [to give the Sponsor and the Property Trustee prompt written
notice of the occurrence of a Special Event;]

         (e)      to establish a record date with respect to all actions to be
taken hereunder that require a record date be established, including and with
respect to, for the purposes of ss. 316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and exchanges, and to issue relevant
notices to the Holders of Preferred Securities and Holders of Common Securities
as to such actions and applicable record dates;

         (f)      to take all actions and perform such duties as may be required
of the Administrative Trustees pursuant to the terms of the Securities;

         (g)      to bring or defend, pay, collect, compromise, arbitrate,
resort to legal action or otherwise adjust claims or demands of or against the
Trust ("Legal Action") unless, pursuant to Section 3.8(e), the Property Trustee
has the exclusive power to bring such Legal Action;

                                      -12-
<PAGE>

         (h)      to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors and
consultants and pay reasonable compensation for such services;

         (i)      to cause the Trust to comply with the Trust's obligations
under the Trust Indenture Act;

         (j)      to give the certificate required byss.314(a)(4) of the Trust
Indenture Act to the Property Trustee, which certificate may be executed by any
Administrative Trustee;

         (k)      to incur expenses that are necessary or incidental to carry
out any of the purposes of the Trust;

         (l)      to act as, or appoint another Person to act as, Registrar for
the Securities or to appoint a Paying Agent [and Conversion Agent] for the
Securities as provided in Section 7.4 except for such time as such power to
appoint a Paying Agent [or Conversion Agent] is vested in the Property Trustee;

         (m)      to give prompt written notice to the Property Trustee and to
Holders of any notice received from the Debenture Issuer of its election to
defer payments of interest on the Debentures by extending the interest payment
period under the Indenture;

         (n)      to take all action that may be necessary or appropriate for
the preservation and the continuation of the Trust's valid existence, rights,
franchises and privileges as a statutory business trust under the laws of the
State of Delaware and of each other jurisdiction in which such existence is
necessary to protect the limited liability of the Holders or to enable the Trust
to effect the purposes for which the Trust was created;

         (o)      to take any action, not inconsistent with this Declaration or
with applicable law, that the Administrative Trustees determine in their
discretion to be necessary or desirable in carrying out the activities of the
Trust as set out in this Section 3.6, including, but not limited to:

                  (i)      causing the Trust not to be deemed to be an
Investment Company required to be registered under the Investment Company Act;

                  (ii)     causing the Trust not to be classified for United
States federal income tax purposes as an association taxable as a corporation;
and

                  (iii)    cooperating with the Debenture Issuer to ensure that
the Debentures will be treated as indebtedness of the Debenture Issuer for
United States federal income tax purposes;

         (p)      to take all action necessary to cause all applicable tax
returns and tax information reports that are required to be filed with respect
to the Trust to be duly prepared and filed by the Administrative Trustees, on
behalf of the Trust; and

         (q)      to execute all documents or instruments, perform all duties
and powers, and do all things for and on behalf of the Trust in all matters
necessary or incidental to the foregoing.

                                      -13-
<PAGE>

         The Administrative Trustees must exercise the powers set forth in this
Section 3.6 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Administrative Trustees shall not take
any action that is inconsistent with the purposes and functions of the Trust set
forth in Section 3.3.

         Subject to this Section 3.6, the Administrative Trustees shall have
none of the powers or the authority of the Property Trustee set forth in Section
3.8.

         The Administrative Trustees shall take all actions on behalf of the
Trust that are not specifically required by this Declaration to be taken by any
other Trustee.

         Any expenses incurred by the Administrative Trustees pursuant to this
Section 3.6 shall be reimbursed by the Debenture Issuer.

SECTION 3.7       Prohibition on Actions by the Trust and the Trustees.

         (a)      The Trust shall not, and the Trustees (including the Property
Trustee) shall cause the Trust not to, engage in any activity other than as
required or authorized by this Declaration. The Trust shall not:

                  (i)      invest any proceeds received by the Trust from
holding the Debentures, but shall distribute all such proceeds to Holders
pursuant to the terms of this Declaration and of the Securities;

                  (ii)     acquire any assets other than as expressly provided
herein;

                  (iii)    possess Trust property for other than a Trust
purpose;

                  (iv)     make any loans or incur any indebtedness other than
loans represented by the Debentures;

                  (v)      possess any power or otherwise act in such a way as
to vary the Trust assets or the terms of the Securities in any way whatsoever,
except as otherwise expressly provided herein;

                  (vi)     issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the Securities;

                  (vii)    other than as provided in this Declaration or Annex I
hereto, (A) direct the time, method and place of conducting any proceeding with
respect to any remedy available to the Debenture Trustee, or exercising any
trust or power conferred upon the Debenture Trustee with respect to the
Debentures; (B) waive any past default that is waivable under the Indenture; (C)
exercise any right to rescind or annul any declaration that the principal of all
the Debentures shall be due and payable; or (D) consent to any amendment,
modification or termination of the Indenture or the Debentures if such consent
shall be required unless in the case of any of (A) (B) (C) or (D), the Trust
shall have received an opinion of independent tax counsel experienced in such
matters to the effect that such amendment, modification or termination will not
cause more than an insubstantial

                                      -14-
<PAGE>

risk that for United States federal income tax purposes the Trust will not be
classified as a grantor trust;

                  (viii)   take any action that would result in the placement of
a pledge or mortgage on any of the Trust property; or

                  (ix)     vary the investment (within the meaning of Treasury
Regulation Section 301.7701-4(c)) of the Trust or of the Holders of Securities.

SECTION 3.8       Powers and Duties of the Property Trustee.

         (a)      The legal title to the Debentures shall be owned by and held
of record in the name of the Property Trustee in trust for the benefit of the
Trust and the Holders. The right, title and interest of the Property Trustee to
the Debentures shall vest automatically in each Person who may hereafter be
appointed as Property Trustee in accordance with Section 5.7. Such vesting and
cessation of title shall be effective whether or not conveyancing documents with
regard to the Debentures have been executed and delivered.

         (b)      The Property Trustee shall not transfer its right, title and
interest in the Debentures to the Administrative Trustees or to the Delaware
Trustee (if the Property Trustee does not also act as Delaware Trustee).

         (c)      The Property Trustee shall:

                  (i)      establish and maintain a segregated non-interest
bearing trust account (the "Property Trustee Account") in the name of and under
the exclusive control of the Property Trustee on behalf of the Holders and, upon
the receipt of payments of funds made in respect of the Debentures held by the
Property Trustee, deposit such funds into the Property Trustee Account and make
payments or cause the Paying Agent to make payments to the Holders from the
Property Trustee Account in accordance with Section 6.1. Funds in the Property
Trustee Account shall be held uninvested until disbursed in accordance with this
Declaration. The Property Trustee Account shall be an account that is maintained
with a banking institution the rating on whose long-term unsecured indebtedness
by a "nationally recognized statistical rating organization", as that term is
defined for purposes of Rule 436(g)(2) under the Securities Act, is at least
investment grade;

                  (ii)     engage in such ministerial activities as shall be
necessary or appropriate to effect the redemption of the Trust Securities to the
extent the Debentures are redeemed or mature; and

                  (iii)    upon written notice of distribution issued by the
Administrative Trustees in accordance with the terms of the Securities, engage
in such ministerial activities as shall be necessary or appropriate to effect
the distribution of the Debentures to Holders upon the occurrence of certain
events.

         (d)      The Property Trustee shall take all actions and perform such
duties as may be specifically required of the Property Trustee pursuant to the
terms of the Securities.

                                      -15-
<PAGE>

         (e)      Subject to Section 3.9(a), the Property Trustee shall take any
Legal Action that arises out of or in connection with an Event of Default of
which a Responsible Officer has actual knowledge or the Property Trustee's
duties and obligations under this Declaration or the Trust Indenture Act;
provided, however, that if an Event of Default has occurred and is continuing
and such event is attributable to the failure of the Debenture Issuer to pay the
principal of or premium, if any, or interest on the Debentures on the date such
principal, premium, if any, or interest is otherwise payable (or in the case of
redemption, on the redemption date), then a Holder of Preferred Securities may
directly institute a proceeding for enforcement of payment to such Holder of the
principal of or premium, if any, or interest on the Debentures having a
principal amount equal to the aggregate Liquidation Amount of the Preferred
Securities of such Holder (a "Direct Action") on or after the respective due
date specified in the Debentures. Notwithstanding any payments made to such
Holder by the Debenture Issuer in connection with such Direct Action, the
Debenture Issuer shall remain obligated to pay the principal of, premium, if
any, or interest on such Debentures, and the Debenture Issuer shall be
subrogated to the rights of such Holder of Preferred Securities to the extent of
any payment made by the Debenture Issuer to such Holder of Preferred Securities
in such Direct Action. Except as provided in the preceding sentences, the
Holders of Preferred Securities will not be able to exercise directly any other
remedy available to the Holders of the Debentures.

         (f)      The Property Trustee shall continue to serve as a Trustee
until either:

                  (i)      the Trust has been completely liquidated and the
proceeds of the liquidation distributed to the Holders pursuant to the terms of
the Securities; or

                  (ii)     a successor Property Trustee has been appointed and
has accepted that appointment in accordance with Section 5.7 (a "Successor
Property Trustee").

         (g)      The Property Trustee shall have the legal power to exercise
all of the rights, powers and privileges of a holder of Debentures under the
Indenture and, if an Event of Default actually known to a Responsible Officer
occurs and is continuing, the Property Trustee shall, for the benefit of
Holders, enforce its rights as holder of the Debentures subject to the rights of
the Holders pursuant to the terms of such Securities.

         (h)      The Property Trustee shall be authorized to undertake any
actions set forth in ss. 317(a) of the Trust Indenture Act.

         (i)      For such time as the Property Trustee is the Paying Agent, the
Property Trustee may authorize one or more Persons to act as additional Paying
Agents and to pay Distributions, redemption payments or liquidation payments on
behalf of the Trust with respect to all Securities and any such Paying Agent
shall comply with ss. 317(b) of the Trust Indenture Act. Any such additional
Paying Agent may be removed by the Property Trustee at any time the Property
Trustee remains as Paying Agent and a successor Paying Agent or additional
Paying Agents may be (but are not required to be) appointed at any time by the
Property Trustee while the Property Trustee is so acting as Paying Agent.

         (j)      Subject to this Section 3.8, the Property Trustee shall have
none of the duties, liabilities, powers or the authority of the Administrative
Trustees set forth in Section 3.6.

                                      -16-
<PAGE>

         Notwithstanding anything expressed or implied to the contrary in this
Declaration or any Annex or Exhibit hereto, (i) the Property Trustee must
exercise the powers set forth in this Section 3.8 in a manner that is consistent
with the purposes and functions of the Trust set out in Section 3.3; and (ii)
the Property Trustee shall not take any action that is inconsistent with the
purposes and functions of the Trust set out in Section 3.3.

SECTION 3.9       Certain Duties and Responsibilities of the Property Trustee.

         (a)      The Property Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Declaration and in the Securities and no implied covenants shall be read
into this Declaration against the Property Trustee. If an Event of Default has
occurred (and has not been cured or waived pursuant to Section 2.6) of which a
Responsible Officer has actual knowledge, the Property Trustee shall exercise
such of the rights and powers vested in it by this Declaration, and shall 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 or her own
affairs.

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

                  (i)      prior to the occurrence of an Event of Default and
after the curing or waiving of all such Events of Default that may have
occurred: (A) the duties and obligations of the Property Trustee shall be
determined solely by the express provisions of this Declaration and in the
Securities and the Property Trustee shall not be liable except for the
performance of such duties and obligations as are specifically set forth in this
Declaration and in the Securities, and no implied covenants or obligations shall
be read into this Declaration or the Securities against the Property Trustee;
and (B) in the absence of bad faith on the part of the Property Trustee, the
Property Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any certificates or
opinions furnished to the Property Trustee and conforming to the requirements of
this Declaration; provided, however, that in the case of any such certificates
or opinions that by any provision hereof are specifically required to be
furnished to the Property Trustee, the Property Trustee shall be under a duty to
examine the same to determine whether or not they conform to the requirements of
this Declaration;

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

                  (iii)    the Property Trustee shall not be liable with respect
to any action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of not less than a Majority in Liquidation
Amount of the Securities relating to the time, method and place of conducting
any proceeding for any remedy available to the Property Trustee, or exercising
any trust or power conferred upon the Property Trustee under this Declaration;

                                      -17-
<PAGE>

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

                  (v)      the Property Trustee's sole duty with respect to the
custody, safekeeping and physical preservation of the Debentures and the
Property Trustee Account shall be to deal with such property in a similar manner
as the Property Trustee deals with similar property for its own account, subject
to the protections and limitations on liability afforded to the Property Trustee
under this Declaration and the Trust Indenture Act;

                  (vi)     the Property Trustee shall have no duty or liability
for or with respect to the value, genuineness, existence or sufficiency of the
Debentures or the payment of any taxes or assessments levied thereon or in
connection therewith;

                  (vii)    the Property Trustee shall not be liable for any
interest on any money received by it except as it may otherwise agree in writing
with the Sponsor; money held by the Property Trustee need not be segregated from
other funds held by it except in relation to the Property Trustee Account
maintained by the Property Trustee pursuant to Section 3.8(c)(i) and except to
the extent otherwise required by law; and

                  (viii)   the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the Sponsor with
their respective duties under this Declaration, nor shall the Property Trustee
be liable for any default or misconduct of the Administrative Trustees or the
Sponsor.

SECTION 3.10      Certain Rights of Property Trustee.

         (a)      Subject to the provisions of Section 3.9:

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

                  (ii)     any direction or act of the Sponsor or the
Administrative Trustees contemplated by this Declaration may be sufficiently
evidenced by an Officers' Certificate;

                  (iii)    whenever in the administration of this Declaration,
the Property Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action hereunder, the
Property Trustee (unless other evidence is herein specifically prescribed) may,
in the absence of bad faith on its part, request and conclusively rely upon an
Officers' Certificate which, upon receipt of such request, shall be promptly
delivered by the Sponsor or the Administrative Trustees;

                                      -18-
<PAGE>

                  (iv)     the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any financing or
continuation statement or any filing under tax or securities laws) or any
rerecording, refiling or reregistration thereof except for those required as a
result of any change in the name, address or identity of the Property Trustee;

                  (v)      the Property Trustee may consult with counsel or
other experts of its selection or request that an Opinion of Counsel be
furnished by, or on behalf of, the Sponsor and the advice or opinion of such
counsel and experts with respect to legal matters or advice within the scope of
such experts' area of expertise or such Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in accordance with such advice or
opinion or Opinion of Counsel, such counsel may be counsel to the Sponsor or any
of its Affiliates, and may include any of its employees;

                  (vi)     the Property Trustee shall have the right at any time
to seek instructions concerning the administration of this Declaration from any
court of competent jurisdiction;

                  (vii)    the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Declaration at the
request or direction of any Holder, unless such Holder shall have provided to
the Property Trustee security and indemnity, reasonably satisfactory to the
Property Trustee, against the costs, expenses (including reasonable attorneys'
fees and expenses and the expenses of the Property Trustee's agents, nominees or
custodians) and liabilities that might be incurred by it in complying with such
request or direction, including such reasonable advances as may be requested by
the Property Trustee;

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

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

                  (x)      any action taken by the Property Trustee or its
agents hereunder shall bind the Trust and the Holders, and the signature of the
Property Trustee or its agents alone shall be sufficient and effective to
perform any such action and no third party shall be required to inquire as to
the authority of the Property Trustee to so act or as to its compliance with any
of the terms and provisions of this Declaration, both of which shall be
conclusively evidenced by the Property Trustee's or its agent's taking such
action;

                  (xi)     whenever in the administration of this Declaration
the Property Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other action hereunder,
the Property Trustee (A) may request instructions from the Holders, which
instructions may only be given by the Holders of the same proportion in
Liquidation Amount

                                      -19-
<PAGE>

of the Securities as would be entitled to direct the Property Trustee under the
terms of the Securities in respect of such remedy, right or action; (B) may
refrain from enforcing such remedy or right or taking such other action until
such instructions are received; and (C) shall be protected in conclusively
relying on or acting in accordance with such instructions;

                  (xii)    except as otherwise expressly provided by this
Declaration, the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Declaration; and

                  (xiii)   the Property Trustee shall not be liable for any
action taken, suffered or omitted to be taken by it in good faith, without
negligence, and reasonably believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Declaration.

         (b)      No provision of this Declaration shall be deemed to impose any
duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent, in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.

SECTION 3.11      Delaware Trustee.

         Notwithstanding any other provision of this Declaration other than
Section 5.2, the Delaware Trustee shall not be entitled to exercise any powers,
nor shall the Delaware Trustee have any of the duties and responsibilities of
the Trustees (except as required under the Business Trust Act) described in this
Declaration. Except as set forth in Section 5.2, the Delaware Trustee shall be a
Trustee for the sole and limited purpose of fulfilling the requirements of
ss.3807 of the Business Trust Act. No implied covenants or obligations shall be
read into this Declaration against the Delaware Trustee.

SECTION 3.12      Execution of Documents.

         Except as otherwise required by the Business Trust Act or this
Declaration, any Administrative Trustee or, if there is only one, such
Administrative Trustee is authorized to execute on behalf of the Trust any
documents that the Administrative Trustees have the power and authority to
execute pursuant to Section 3.6.

SECTION 3.13      Not Responsible for Recitals or Issuance of Securities.

         The recitals contained in this Declaration and the Securities shall be
taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as to
the value or condition of the property of the Trust or any part thereof. The
Trustees make no representations as to the validity or sufficiency of this
Declaration or the Securities.

SECTION 3.14      Duration of Trust.

                                      -20-
<PAGE>

         The Trust, unless dissolved pursuant to the provisions of Article VIII
hereof, shall dissolve on ________, ____.

SECTION 3.15      Mergers.

         (a)      The Trust may not merge with or into, convert into,
consolidate or amalgamate with, be replaced by, or convey, transfer or lease its
properties and assets substantially as an entirety to, any Person, except as
described in Section 3.15(b) and (c) of this Declaration and Section 3 of Annex
I.

         (b)      The Trust may, at the request of the Sponsor, with the consent
of the Administrative Trustees or, if there are more than two, a majority of the
Administrative Trustees and without the consent of the Holders, the Delaware
Trustee or the Property Trustee, merge with or into, convert into, consolidate
or amalgamate with, be replaced by, or convey, transfer or lease its properties
and assets as an entirety or substantially as an entirety to, a trust organized
as such under the laws of any State; provided that:

                  (i)      such successor entity (the "Successor Entity")
either: (A) expressly assumes all of the obligations of the Trust under the
Securities and this Declaration; or (B) substitutes for the Securities other
securities having substantially the same terms as the Securities (the "Successor
Securities") so long as the Successor Securities rank the same as the Securities
rank with respect to Distributions and payments upon liquidation, redemption and
otherwise;

                  (ii)     the Sponsor expressly appoints a trustee of the
Successor Entity that possesses the same powers and duties as the Property
Trustee as the holder of the Debentures;

                  (iii)    the Successor Securities are listed or quoted, or any
Successor Securities will be listed or quoted upon notification of issuance, on
any national securities exchange or with another organization on which the
Preferred Securities are then listed or quoted, if any;

                  (iv)     if the Preferred Securities (including any Successor
Securities) are rated by any nationally recognized statistical rating
organization prior to such transaction, such merger, conversion, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not cause the
Preferred Securities (including any Successor Securities), or if the Debentures
are so rated, the Debentures, to be downgraded by any nationally recognized
statistical rating organization;

                  (v)      such merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the Holders (including the holders of any
Successor Securities) in any material respect (other than with respect to any
dilution of such Holders' interests in the new entity);

                  (vi)     such Successor Entity has a purpose substantially
identical to that of the Trust;

                  (vii)    prior to such merger, conversion, consolidation,
amalgamation, replacement, conveyance, transfer or lease, the Sponsor has
received an opinion of an independent counsel to the Trust experienced in such
matters to the effect that: (A) such merger, conversion,

                                      -21-
<PAGE>

consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the Holders
(including the holders of any Successor Securities) in any material respect
(other than with respect to any dilution of the Holders' interest in the new
entity); (B) following such merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Trust nor the Successor
Entity will be required to register as an Investment Company; and (C) following
such merger, conversion, consolidation, amalgamation, replacement, conveyance,
transfer or lease, the Trust (or the Successor Entity) will continue to be
classified as a grantor trust for United States federal income tax purposes; and

                  (viii)   the Sponsor or any permitted successor or assignee
owns all of the common securities of such Successor Entity and guarantees the
obligations of such Successor Entity under the Successor Securities at least to
the extent provided by the Preferred Securities Guarantee and the Common
Securities Guarantee.

         (c)      Notwithstanding Section 3.15(b), the Trust shall not, except
with the consent of Holders of 100% in Liquidation Amount of the Securities,
consolidate, amalgamate or merge with or into, convert into, be replaced by, or
convey, transfer or lease its properties and assets as an entirety or
substantially as an entirety to, any other Person or permit any other Person to
consolidate, amalgamate or merge with or into, convert into or replace it if
such consolidation, conversion, amalgamation, merger, replacement, conveyance,
transfer or lease would cause the Trust or the Successor Entity not to be
classified as a grantor trust for United States federal income tax purposes or
would cause the Holders of the Securities not to be treated as owning an
undivided interest in the Debentures.

                                   ARTICLE IV
                                     SPONSOR

SECTION 4.1       Sponsor's Purchase of Common Securities.

         At the Closing Date and any Option Closing Time, if applicable, the
Sponsor will purchase all of the Common Securities then issued by the Trust, in
an amount equal to at least 3% of the total capital of the Trust, at the same
time as the Preferred Securities are issued and sold.

SECTION 4.2       Responsibilities of the Sponsor.

         In connection with the issue and sale of the Preferred Securities, the
Sponsor shall have the exclusive right and responsibility to engage in the
following activities:

         (a)      if deemed necessary by the Sponsor and not performed by the
Sponsor prior to the date of this Declaration pursuant to the Original
Declaration, to prepare for filing by the Trust with the Commission any
Registration Statement (including a prospectus contained therein and any
prospectus supplement relating thereto), including any amendments thereto, as
contemplated by Section 3.6(b)(i);

         (b)      if deemed necessary by the Sponsor and not performed by the
Sponsor prior to the date of this Declaration pursuant to the Original
Declaration, to determine the States in which to take appropriate action to
qualify or register for sale all or part of the Preferred Securities and to do
any

                                      -22-
<PAGE>

and all such acts, other than actions that must be taken by the Trust, and
advise the Trust of actions it must take, and prepare for execution and filing
any documents to be executed and filed by the Trust, as the Sponsor deems
necessary or advisable in order to comply with the applicable laws of any such
States;

         (c)      if deemed necessary or desirable by the Sponsor, to prepare
for filing by the Trust an application to permit the Preferred Securities to
trade or be quoted or listed on any securities exchange, quotation system or the
Nasdaq Stock Market's National Market;

         (d)      if deemed necessary or desirable by the Sponsor, to prepare
for and execute for filing by the Trust with the Commission a registration
statement on Form 8-A, including any amendments thereto, relating to the
registration of the Preferred Securities under Section 12(b) of the Exchange
Act;

         (e)      if deemed necessary by the Sponsor and not performed by the
Sponsor prior to the date of this Declaration pursuant to the Original
Declaration, to negotiate the terms of an Underwriting Agreement providing for
the offering and sale of the Preferred Securities; and

         (f)      if deemed necessary by the Sponsor and not performed by the
Sponsor prior to the date of this Declaration pursuant to the Original
Declaration, to negotiate the terms of the Debenture Subscription Agreement and
the Common Securities Subscription Agreement.

SECTION 4.3       Right to Proceed.

         The Sponsor acknowledges the rights of the Holders of Preferred
Securities (as set forth in Section 3.8(e) of this Declaration and Sections 6(b)
and 7(c) of Annex I), if a failure of the Trust to pay Distributions on the
Preferred Securities is attributable to the failure of the Company to pay
interest or principal on the Debentures, to institute a proceeding directly
against the Debenture Issuer for enforcement of its payment obligations on the
Debentures.

                                    ARTICLE V
                                    TRUSTEES

SECTION 5.1       Number of Trustees; Appointment of Co-Trustee.

         The number of Trustees initially shall be [five] and:

         (a)      at any time before the issuance of any Securities, the Sponsor
may, by written instrument, increase or decrease the number of Trustees; and

         (b)      after the issuance of any Securities, the number of Trustees
may be increased or decreased by vote of the Holders of a Majority in
Liquidation Amount of the Common Securities voting as a class at a meeting of
the Holders of the Common Securities; provided, however, that, the number of
Trustees shall in no event be less than two; provided further that (i) one
Trustee shall satisfy the requirements of the Delaware Trustee pursuant to
Section 5.2; (ii) there shall be at least one Trustee who is an officer of the
Sponsor (an "Administrative Trustee"); and (iii) one Trustee shall be the
Property Trustee for so long as this Declaration is required to qualify as an
indenture

                                      -23-
<PAGE>

under the Trust Indenture Act, and such Trustee may also serve as Delaware
Trustee if it meets the applicable requirements. Notwithstanding the above,
unless an Event of Default shall have occurred and be continuing, at any time or
times, for the purpose of meeting the legal requirements of the Trust Indenture
Act or of any jurisdiction in which any part of the Trust's property may at the
time be located, the Holders of a Majority in Liquidation Amount of the Common
Securities acting as a class at a meeting of the Holders of the Common
Securities and the Administrative Trustees shall have the power to appoint one
or more Persons either to act as a co-trustee, jointly with the Property
Trustee, of all or any part of the Trust's property, or to act as separate
trustee of any such property, in either case with such powers as may be provided
in the instrument of appointment, and to vest in such Person or Persons in such
capacity any property, title, right or power deemed necessary or desirable,
subject to the provisions of this Declaration. If an Event of Default has
occurred and is continuing, the Property Trustee alone shall have power to make
any such appointment of a co-trustee.

SECTION 5.2       Delaware Trustee.

         If required by the Business Trust Act, one Trustee (the "Delaware
Trustee") shall be:

         (a)      a natural person who is a resident of the State of Delaware;
or

         (b)      if not a natural person, an entity that has its principal
place of business in the State of Delaware and otherwise meets the requirements
of applicable law; provided that, if the Property Trustee has its principal
place of business in the State of Delaware and otherwise meets the requirements
of applicable law, then the Property Trustee shall also be the Delaware Trustee
and Section 3.11 shall have no application.

SECTION 5.3       Property Trustee; Eligibility.

         (a)      At all times there shall be one Trustee (the "Property
Trustee") that will act as Property Trustee and will:

                  (i)      not be an Affiliate of the Sponsor; and

                  (ii)     be a Person organized and doing business under the
laws of the United States of America or any state or territory thereof or of the
District of Columbia, or a Person permitted by the Commission to act as an
institutional trustee under the Trust Indenture Act, authorized under such laws
to exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000 and subject to supervision or examination by federal, state,
territorial or District of Columbia authority. If such Person publishes reports
of condition at least annually, pursuant to law or to the requirements of the
supervising or examining authority referred to above, then for the purposes of
this Section 5.3(a)(ii), the combined capital and surplus of such Person shall
be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published.

         (b)      If at any time the Property Trustee shall cease to be eligible
to so act under Section 5.3(a), the Property Trustee shall immediately resign in
the manner and with the effect set forth in Section 5.7(c).

                                      -24-
<PAGE>

         (c)      If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of ss. 310(b) of the Trust Indenture Act, the
Property Trustee and the Holder of the Common Securities (as if it were the
obligor referred to in ss. 310(b) of the Trust Indenture Act) shall in all
respects comply with the provisions of ss. 310(b) of the Trust Indenture Act.

         (d)      The Preferred Securities Guarantee and the Indenture shall be
deemed to be specifically described in this Declaration for purposes of clause
(i) of the first proviso contained in ss. 310(b) of the Trust Indenture Act.

         (e)      The initial Property Trustee shall be:

         Bank One Trust Company, National Association
         1 Bank One Plaza
         Suite IL1 0126
         Chicago, Illinois 60670-0126
         Attention: Corporate Trust Services Division

SECTION 5.4       Certain Qualifications of Administrative Trustees and Delaware
                  Trustee Generally.

         Each Administrative Trustee and the Delaware Trustee (unless the
Property Trustee also acts as Delaware Trustee) shall be either a natural person
who is at least 21 years of age or a legal entity that shall act through one or
more Authorized Officers.

SECTION 5.5       Administrative Trustees.

         The initial Administrative Trustees shall be:

         _______________
         _______________
         _______________

         (a)      Except as expressly set forth in this Declaration and except
if a meeting of the Administrative Trustees is called with respect to any matter
over which the Administrative Trustees have power to act, any power of the
Administrative Trustees may be exercised by, or with the consent of, any one
such Administrative Trustee.

         (b)      An Administrative Trustee shall have the authority set forth
in Section 3.12 to execute on behalf of the Trust any documents that the
Administrative Trustees have the power and authority to cause the Trust to
execute pursuant to Section 3.6.

SECTION 5.6       Delaware Trustee.

                                      -25-
<PAGE>

         The initial Delaware Trustee shall be:

         Bank One Delaware, Inc.
         3 Christina Centre
         201 North Walnut Street
         Wilmington, Delaware 19801-2920

SECTION 5.7       Appointment, Removal and Resignation of Trustees.

         (a)      Subject to Section 5.7(b) of this Declaration and to Section
6(b) of Annex I hereto, Trustees may be appointed or removed without cause at
any time:

                  (i)      until the issuance of any Securities, by written
instrument executed by the Sponsor;

                  (ii)     with respect to the Administrative Trustees, after
the issuance of any Securities, by the vote of Holders of a Majority in
Liquidation Amount of the Common Securities voting as a class at a meeting of
the Holders of the Common Securities;

                  (iii)    unless an Event of Default shall have occurred and be
continuing after the issuance of any Securities, by vote of the Holders of a
Majority in Liquidation Amount of the Common Securities voting as a class at a
meeting of the Holders of the Common Securities; and

                  (iv)     with respect to the Property Trustee or the Delaware
Trustee, if an Event of Default shall have occurred and be continuing after the
issuance of the Securities, , by vote of Holders of a Majority in Liquidation
Amount of the Preferred Securities voting as a class at a meeting of Holders of
the Preferred Securities.

         (b)      (i)      The Trustee that acts as Property Trustee shall not
be removed in accordance with Section 5.7(a) until a Successor Property Trustee
has been appointed and has accepted such appointment by written instrument
executed by such Successor Property Trustee and delivered to the Administrative
Trustees and the Sponsor; and

                  (ii)     the Trustee that acts as Delaware Trustee shall not
be removed in accordance with Section 5.7(a) until a successor Trustee
possessing the qualifications to act as Delaware Trustee under Sections 5.2 and
5.4 (a "Successor Delaware Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor Delaware Trustee
and delivered to the Administrative Trustees and the Sponsor.

         (c)      A Trustee appointed to office shall hold office until his
successor shall have been appointed or until his death, removal or resignation.
Any Trustee may resign from office (without need for prior or subsequent
accounting) by an instrument in writing signed by the Trustee and delivered to
the Sponsor and the Trust, which resignation shall take effect upon such
delivery or upon such later date as is specified therein; provided, however,
that:

                                      -26-
<PAGE>

                  (i)      no such resignation of the Trustee that acts as the
Property Trustee shall be effective: (A) until a Successor Property Trustee has
been appointed and has accepted such appointment by instrument executed by such
Successor Property Trustee and delivered to the Trust, the Sponsor and the
resigning Property Trustee; or (B) until the assets of the Trust have been
completely liquidated and the proceeds thereof distributed to the Holders; and

                  (ii)     no such resignation of the Trustee that acts as the
Delaware Trustee shall be effective until a Successor Delaware Trustee has been
appointed and has accepted such appointment by instrument executed by such
Successor Delaware Trustee and delivered to the Trust, the Sponsor and the
resigning Delaware Trustee.

         (d)      The Holders of the Common Securities or, if an Event of
Default shall have occurred and be continuing after the issuance of the
Securities, the Holders of the Preferred Securities shall use their best efforts
to promptly appoint a Successor Delaware Trustee or Successor Property Trustee,
as the case may be, if the Property Trustee or the Delaware Trustee delivers an
instrument of resignation in accordance with this Section 5.7.

         (e)      If no Successor Property Trustee or Successor Delaware Trustee
shall have been appointed and accepted appointment as provided in this Section
5.7 within 60 days after delivery of an instrument of resignation or removal,
the Property Trustee or Delaware Trustee resigning or being removed, as
applicable, may petition any court of competent jurisdiction for appointment of
a Successor Property Trustee or Successor Delaware Trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and prescribe,
appoint a Successor Property Trustee or Successor Delaware Trustee, as the case
may be.

         (f)      No Property Trustee or Delaware Trustee shall be liable for
the acts or omissions to act of any Successor Property Trustee or Successor
Delaware Trustee, as the case may be.

         (g)      At the time of resignation or removal of the Property Trustee
or the Delaware Trustee, the Debenture Issuer shall pay to such Trustee any
amounts that may be owed to such Trustee pursuant to Section 10.4.

SECTION 5.8       Vacancies Among Trustees.

         If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 5.1, or if the number of Trustees is
increased pursuant to Section 5.1, a vacancy shall occur. A resolution
certifying the existence of such vacancy by the Administrative Trustees or, if
there are more than two, a majority of the Administrative Trustees shall be
conclusive evidence of the existence of such vacancy. The vacancy shall be
filled with a Trustee appointed in accordance with Section 5.7.

SECTION 5.9       Effect of Vacancies.

         The death, resignation, retirement, removal, bankruptcy, dissolution,
liquidation, incompetence or incapacity to perform the duties of a Trustee shall
not operate to dissolve, terminate or annul the Trust. Whenever a vacancy in the
number of Administrative Trustees shall occur, until such vacancy is filled by
the appointment of an Administrative Trustee in accordance with Section

                                      -27-
<PAGE>

5.7, the Administrative Trustees in office, regardless of their number, shall
have all the powers granted to the Administrative Trustees and shall discharge
all the duties imposed upon the Administrative Trustees by this Declaration.

SECTION 5.10      Meetings.

         If there is more than one Administrative Trustee, meetings of the
Administrative Trustees shall be held from time to time upon the call of any
Administrative Trustee. Regular meetings of the Administrative Trustees may be
held at a time and place fixed by resolution of the Administrative Trustees.
Notice of any in-person meetings of the Administrative Trustees shall be hand
delivered or otherwise delivered in writing (including by facsimile, with a hard
copy by overnight courier) not less than 24 hours before such meeting. Notice of
any telephonic meetings of the Administrative Trustees or any committee thereof
shall be hand delivered or otherwise delivered in writing (including by
facsimile, with a hard copy by overnight courier) not less than 24 hours before
a meeting. Notices shall contain a brief statement of the time, place and
anticipated purposes of the meeting. The presence (whether in person or by
telephone) of an Administrative Trustee at a meeting shall constitute a waiver
of notice of such meeting except where an Administrative Trustee attends a
meeting for the express purpose of objecting to the transaction of any activity
on the ground that the meeting has not been lawfully called or convened. Unless
otherwise provided in this Declaration, any action of the Administrative
Trustees may be taken at a meeting by vote of a majority of the Administrative
Trustees present (whether in person or by telephone) and eligible to vote with
respect to such matter, provided that a Quorum is present, or without a meeting
by the unanimous written consent of the Administrative Trustees. In the event
there is only one Administrative Trustee, any and all action of such
Administrative Trustee shall be evidenced by a written consent of such
Administrative Trustee.

SECTION 5.11      Delegation of Power.

         (a)      Any Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purpose of executing any documents
contemplated in Section 3.6, including any registration statement or amendment
thereto filed with the Commission, or making any other governmental filing; and

         (b)      the Administrative Trustees shall have power to delegate from
time to time to such of their number or to officers of the Trust the doing of
such things and the execution of such instruments either in the name of the
Trust or the names of the Administrative Trustees or otherwise as the
Administrative Trustees may deem expedient, to the extent such delegation is not
prohibited by applicable law or contrary to the provisions of this Declaration.

SECTION 5.12      Merger, Conversion, Consolidation or Succession to Business.

         Any Person into which the Property Trustee or the Delaware Trustee or
any Administrative Trustee that is not a natural person, as the case may be, may
be merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which the Property
Trustee or the Delaware Trustee or any Administrative Trustee, as the case may
be, shall be a party, or any Person succeeding to all or substantially all the
corporate trust business of the

                                      -28-
<PAGE>

Property Trustee or the Delaware Trustee or any Administrative Trustee, as the
case may be, shall be the successor of the Property Trustee or the Delaware
Trustee or such Administrative Trustee, as the case may be, hereunder, provided
such Person shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.

                                   ARTICLE VI
                                  DISTRIBUTIONS

SECTION 6.1       Distributions.

         Holders shall receive Distributions in accordance with the applicable
terms of the relevant Holder's Securities as set forth herein and in Annex I. If
and to the extent that the Debenture Issuer makes a payment of interest
(including Compounded Interest and Additional Sums (as such terms are defined in
the Indenture) or premium on or principal of the Debentures held by the Property
Trustee (the amount of any such payment being a "Payment Amount"), the Property
Trustee shall and is directed, to the extent funds are available for that
purpose, to make a distribution (a "Distribution") of the Payment Amount to
Holders.

                                   ARTICLE VII
                             ISSUANCE OF SECURITIES

SECTION 7.1       General Provisions Regarding Securities.

         (a)      The Administrative Trustees shall on behalf of the Trust issue
one class of preferred securities representing undivided beneficial interests in
the assets of the Trust having such terms as are set forth in Annex I (the
"Preferred Securities") and one class of common securities representing
undivided beneficial interests in the assets of the Trust having such terms as
are set forth in Annex I (the "Common Securities"). Annex I is hereby
incorporated in and made a part of this Declaration. The Trust shall issue no
securities or other interests in the assets of the Trust other than the Trust
Securities.

         (b)      The consideration received by the Trust for the issuance of
the Securities shall constitute a contribution to the capital of the Trust and
shall not constitute a loan to the Trust.

         (c)      Upon issuance of the Securities as provided in this
Declaration, the Securities so issued shall be deemed to be validly issued,
fully paid and non-assessable undivided beneficial interests in the assets of
Trust.

         (d)      Every Person, by virtue of having become a Holder or a
Preferred Security Beneficial Owner in accordance with the terms of this
Declaration, shall be deemed to have expressly assented and agreed to the terms
of, and shall be bound by, this Declaration.

         (e)      Holders of the Securities shall not have any preemptive or
similar rights.

         (f)      At the Closing Date [and, if applicable, any Option Closing
Time], an Administrative Trustee, on behalf of the Trust, shall subscribe to and
purchase from the Debenture Issuer,

                                      -29-
<PAGE>

Debentures registered in the name of the Property Trustee on behalf of the Trust
and having an aggregate principal amount equal to the aggregate Liquidation
Amount of the Preferred Securities and Common Securities issued and sold on such
date, and, in satisfaction of the purchase price for such Debentures, the
Property Trustee, on behalf of the Trust, shall deliver to the Debenture Issuer
the amount received on such date from the sale by the Trust of the Preferred
Securities and Common Securities issued on such date.

SECTION 7.2       Execution and Authentication.

         (a)      The Securities shall be signed on behalf of the Trust by an
Administrative Trustee by manual or facsimile signature. In case any
Administrative Trustee of the Trust who shall have signed any of the Securities
shall cease to be such Administrative Trustee before the Securities so signed
shall be delivered by the Trust, such Securities nevertheless may be delivered
as though the person who signed such Securities had not ceased to be such
Administrative Trustee; and any Securities may be signed on behalf of the Trust
by such persons who, at the actual date of execution of such Security, shall be
the Administrative Trustees of the Trust, although at the date of the execution
and delivery of this Declaration such person was not an Administrative Trustee.

         (b)      A Preferred Security shall not be valid until authenticated by
the manual or facsimile signature of an authorized signatory of the Property
Trustee. The signature shall be conclusive evidence that the Preferred Security
has been authenticated under this Declaration.

         (c)      Upon a written order of the Trust signed by one Administrative
Trustee, the Property Trustee shall authenticate the Preferred Securities for
original issue. The aggregate number of Preferred Securities outstanding at any
time shall not exceed the number set forth in Annex I hereto except as provided
in Section 7.6.

         (d)      The Property Trustee may appoint an authenticating agent
acceptable to the Trust to authenticate Preferred Securities. An authenticating
agent may authenticate Preferred Securities whenever the Property Trustee may do
so. Each reference in this Declaration to authentication by the Property Trustee
includes authentication by such agent. An authenticating agent has the same
rights as the Property Trustee to deal with the Sponsor or an Affiliate.

SECTION 7.3       Form and Dating.

         (a)      The Preferred Securities and the Property Trustee's
certificate of authentication shall be substantially in the form of Exhibit A-1
hereto and the Common Securities shall be substantially in the form of Exhibit
A-2 hereto, each of which is hereby incorporated in and expressly made a part of
this Declaration. Certificates representing the Securities may be printed,
lithographed or engraved or may be produced in any other manner as is reasonably
acceptable to the Administrative Trustees, as evidenced by the execution thereof
by one or more of them. The Securities may have letters, CUSIP or other numbers,
notations or other marks of identification or designation and such legends or
endorsements required by law, stock exchange or market rule, agreements to which
the Trust is subject, if any, or usage (provided that any such notation, legend
or endorsement is in a form acceptable to the Trust). The Trust, at the
direction of the Sponsor, shall furnish any such legend not contained in Exhibit
A-1 to the Property Trustee in writing. Each Preferred Security shall be dated

                                      -30-
<PAGE>

the date of its authentication. The terms and provisions of the Securities set
forth in Annex I and the forms of Securities set forth in Exhibits A-1 and A-2
are part of the terms of this Declaration and, to the extent applicable, the
Property Trustee and the Sponsor, by their execution and delivery of this
Declaration, expressly agree to such terms and provisions and to be bound
thereby.

         (b)      Securities offered may be issued in the form of one or more
permanent global Securities in definitive, fully registered form without
distribution coupons with the appropriate global legends set forth in Exhibit
A-1 hereto (the "Global Preferred Securities"), which shall be deposited on
behalf of the purchasers of the Preferred Securities represented thereby with
the Property Trustee, as custodian for the Clearing Agency, and registered in
the name of the Clearing Agency or a nominee of the Clearing Agency, duly
executed by the Trust and authenticated by the Property Trustee as hereinafter
provided. The number of Preferred Securities represented by the Global Preferred
Security may from time to time be increased or decreased by adjustments made on
the records of the Property Trustee and the Clearing Agency or its nominee as
hereinafter provided.

         (c)      If Global Preferred Securities are to be issued, the Trust
shall execute and the Property Trustee shall, in accordance with this Section
7.3, authenticate and make available for delivery initially one or more Global
Preferred Securities that (i) shall be registered in the name of Cede & Co. or
other nominee of such Clearing Agency; and (ii) shall be delivered by the
Trustee to such Clearing Agency or pursuant to such Clearing Agency's written
instructions or held by the Property Trustee as custodian for the Clearing
Agency.

         (d)      If Global Preferred Securities are to be issued, Clearing
Agency Participants shall have no rights under this Declaration with respect to
any Global Preferred Security held on their behalf by the Clearing Agency or by
the Property Trustee as the custodian of the Clearing Agency or under such
Global Preferred Security, and the Clearing Agency may be treated by the Trust,
the Property Trustee and any agent of the Trust or the Property Trustee as the
absolute owner of such Global Preferred Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Trust, the
Property Trustee or any agent of the Trust or the Property Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Clearing Agency or impair, as between the Clearing Agency and Clearing
Agency Participants, the operation of customary practices of such Clearing
Agency governing the exercise of the rights of a Preferred Security Beneficial
Owner.

         (e)      Except as provided in Section 7.9(b) or 9.2, owners of
beneficial interests in a Global Preferred Security will not be entitled to
receive physical delivery of certificated Preferred Securities. Preferred
Securities not represented by a Global Preferred Security may be issued in the
form of individual certificates in definitive, fully registered form without
distribution coupons ("Definitive Preferred Securities").

         (f)      The Preferred Securities are issuable only in denominations of
$______ and any integral multiple thereof.

SECTION 7.4       Registrar and Paying Agent [and Conversion Agent].

                                      -31-
<PAGE>

         The Trust shall maintain in the Borough of Manhattan, The City of New
York, (a) an office or agency where Preferred Securities may be presented for
registration of transfer ("Registrar"); (b) an office or agency where Preferred
Securities may be presented for payment ("Paying Agent"); [and (c) an office or
agency where securities may be presented for conversion or exchange (a
"Conversion Agent.")]. The Registrar shall keep a register of the Preferred
Securities and of their transfer. The Trust may appoint the Registrar, Paying
Agent [and Conversion Agent] and may appoint one or more co-registrars and one
or more additional paying agents [or conversion agents] in such other locations
as it shall determine. The term "Registrar" includes any additional registrar,
the term "Paying Agent" includes any additional paying agent [and the term
"Conversion Agent" includes any additional conversion agent.]. The Trust may
change any Agent without prior notice to any Holder. The Paying Agent shall be
permitted to resign as Paying Agent upon 30 days' written notice to the Property
Trustee and the Sponsor. The Trust shall notify the Property Trustee of the name
and address of any Agent not a party to this Declaration. If the Trust fails to
appoint or maintain another entity as Registrar, Paying Agent [or Conversion
Agent], the Property Trustee shall act as such. The Trust or any of its
Affiliates may act as Paying Agent, Registrar [or Conversion Agent]. The Trust
shall act as Paying Agent, Registrar [and Conversion Agent] for the Common
Securities.

         The Trust initially appoints the Property Trustee as Registrar, Paying
Agent [and Conversion Agent] for the Preferred Securities.

         Agents shall be entitled to all of the rights, protections, immunities
and indemnities afforded to the Property Trustee hereunder.

SECTION 7.5       Paying Agent to Hold Money in Trust.

         The Trust shall require each Paying Agent other than the Property
Trustee to agree in writing that the Paying Agent will hold in trust for the
benefit of Holders or the Property Trustee all money held by the Paying Agent
for the payment of Liquidation Amounts or Distributions, and will notify the
Property Trustee if there are insufficient funds for such purpose. While any
such insufficiency continues, the Property Trustee may require a Paying Agent to
pay all money held by it to the Property Trustee. The Trust at any time may
require a Paying Agent to pay all money held by it to the Property Trustee and
to account for any money disbursed by it. Upon payment over to the Property
Trustee, the Paying Agent (if other than the Trust or an Affiliate of the Trust)
shall have no further liability for the money. If the Trust or the Sponsor or an
Affiliate of the Trust or the Sponsor acts as Paying Agent, it shall segregate
and hold in a separate trust fund for the benefit of the Holders all money held
by it as Paying Agent.

SECTION 7.6       Replacement Securities.

         If a Holder claims that a Security owned by it has been lost, destroyed
or wrongfully taken or if such Security is mutilated and is surrendered to the
Trust or in the case of the Preferred Securities to the Property Trustee, the
Trust shall issue and the Property Trustee shall, upon written order of the
Trust, authenticate a replacement Security if the Property Trustee's and the
Trust's requirements, as the case may be, are met. An indemnity bond must be
provided by the Holder which, in the judgment of the Property Trustee, is
sufficient to protect the Trustees, the Sponsor, the Trust or any

                                      -32-
<PAGE>

authenticating agent from any loss that any of them may suffer if a Security is
replaced. The Trust may charge such Holder for its expenses in replacing a
Security. Every replacement Security issued and authenticated in accordance with
this Section 7.6 shall represent an undivided beneficial interest in the assets
of the Trust.

SECTION 7.7       Outstanding Preferred Securities.

         The Preferred Securities outstanding at any time are all the Preferred
Securities authenticated by the Property Trustee except for those canceled by
it, those delivered to it for cancellation and those described in this Section
as not outstanding.

         If a Preferred Security is replaced pursuant to Section 7.6 hereof, it
ceases to be outstanding unless the Property Trustee receives proof satisfactory
to it that the replaced Preferred Security is held by a bona fide purchaser.

         If Preferred Securities are considered paid in accordance with the
terms of this Declaration, they cease to be outstanding and Distributions on
them shall cease to accumulate.

         A Preferred Security does not cease to be outstanding because one of
the Trust, the Sponsor or an Affiliate of the Sponsor holds the Security.

SECTION 7.8       Preferred Securities in Treasury.

         In determining whether the Holders of the required amount of Securities
have concurred in any direction, waiver or consent, Preferred Securities owned
by the Trust, the Sponsor or an Affiliate of the Sponsor, as the case may be,
shall be disregarded and deemed not to be outstanding, except that for the
purposes of determining whether the Property Trustee shall be fully protected in
relying on any such direction, waiver or consent, only Securities that a
Responsible Officer of the Property Trustee actually knows are so owned shall be
so disregarded. SECTION 7.9 Temporary Securities.

         (a)      Until Definitive Preferred Securities are ready for delivery,
the Trust may prepare and, in the case of the Preferred Securities, the Property
Trustee shall authenticate temporary Securities. Temporary Securities shall be
substantially in the form of Definitive Preferred Securities but may have
variations that the Trust considers appropriate for temporary Securities.
Without unreasonable delay, the Trust shall prepare and, in the case of the
Preferred Securities, the Property Trustee shall authenticate Definitive
Preferred Securities in exchange for temporary Securities.

         (b)      A Global Preferred Security deposited with the Clearing Agency
or with the Property Trustee as custodian for the Clearing Agency pursuant to
Section 7.3 shall be transferred to the beneficial owners thereof in the form of
Definitive Preferred Securities only if such transfer complies with Section 9.2
and (i) the Clearing Agency notifies the Sponsor that it is unwilling or unable
to continue as Clearing Agency for such Global Preferred Security or if at any
time such Clearing Agency ceases to be a "clearing agency" registered under the
Exchange Act and a clearing agency is not appointed by the Sponsor within 90
days of such notice; or (ii) the Administrative Trustees, on

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<PAGE>

behalf of the Trust, at their sole discretion elect to cause the issuance of
Definitive Preferred Securities.

         (c)      Any Global Preferred Security that is transferable to the
beneficial owners thereof in the form of Definitive Preferred Securities
pursuant to this Section 7.9 shall be surrendered by the Clearing Agency to the
Property Trustee, to be so transferred, in whole or from time to time in part,
without charge, and the Administrative Trustee shall prepare and the Property
Trustee shall authenticate and make available for delivery, upon such transfer
of each portion of such Global Preferred Security, an equal aggregate
Liquidation Amount of Securities of authorized denominations in the form of
certificated Preferred Securities. Any portion of a Global Preferred Security
transferred pursuant to this Section shall be registered in such names as the
Clearing Agency shall direct.

         (d)      Subject to the provisions of Section 7.9(c), the Holder of a
Global Preferred Security may grant proxies and otherwise authorize any Person,
including Clearing Agency Participants and Persons that may hold interests
through Clearing Agency Participants, to take any action that such Holder is
entitled to take under this Declaration or the Securities.

         (e)      Upon the occurrence of any of the events specified in Section
7.9(b), the Administrative Trustees on behalf of the Trust will promptly make
available to the Property Trustee a reasonable supply of certificated Preferred
Securities in fully registered form without distribution coupons.

SECTION 7.10      Exchange.

         (a)      If at any time the Sponsor or any of its Affiliates (in either
case, a "Sponsor Affiliated Holder") is the Holder of any Preferred Securities,
such Sponsor Affiliated Holder shall have the right to deliver to the Property
Trustee all or such portion of its Preferred Securities as its elects and
receive, in exchange therefore, a like amount of Debentures. Such election (i)
shall be exercised by such Sponsor Affiliated Holder delivering to the Property
Trustee a written notice of such election specifying the Liquidation Amount of
Preferred Securities with respect to which such election is being made and the
date of Distribution on which such exchange shall occur, which Distribution date
shall be not fewer than ten Business Days after the date of receipt by the
Property Trustee of such election notice; and (ii) shall be conditioned upon
such Sponsor Affiliated Holder having delivered or caused to be delivered to the
Property Trustee or its designee the Preferred Securities that are the subject
of such election by 10:00 A.M., New York time, on the date of Distribution on
which such exchange is to occur. After the exchange, such Preferred Securities
will be canceled and will no longer be deemed to be outstanding and all rights
of the Sponsor or its Affiliates with respect to such Preferred Securities will
cease.

         (b)      In the case of an exchange described in Section 7.10(a), the
Trust will, on the date of such exchange, exchange Debentures having a principal
amount equal to a proportional amount of the aggregate Liquidation Amount of the
outstanding Common Securities, based on the ratio of the aggregate Liquidation
Amount of the Preferred Securities exchanged pursuant to Section 7.10(a) divided
by the aggregate Liquidation Amount of the Preferred Securities outstanding
immediately prior to such exchange, for such proportional amount of Common
Securities held by the Sponsor

                                      -34-
<PAGE>

(which contemporaneously shall be canceled and no longer be deemed to be
outstanding); provided, that the Sponsor delivers or caused to be delivered to
the Property Trustee or its designee the required amount of Common Securities to
be exchanged by 10:00 A.M., New York time, on the date of Distribution on which
such exchange is to occur.

SECTION 7.11      Cancellation.

         The Trust at any time may deliver Preferred Securities to the Property
Trustee for cancellation. The Registrar and the Paying Agent shall forward to
the Property Trustee any Preferred Securities surrendered to them for
registration of transfer, redemption, exchange or payment. The Property Trustee
shall promptly cancel all Preferred Securities, surrendered for registration of
transfer, redemption, exchange, payment, replacement or cancellation and shall
dispose of canceled Preferred Securities in accordance with its customary
procedures unless the Trust otherwise directs. The Trust may not issue new
Preferred Securities to replace Preferred Securities that it has paid or that
have been delivered to the Property Trustee for cancellation or that any Holder
has exchanged.

SECTION 7.12      CUSIP Numbers.

         In issuing the Preferred Securities, the Trust may use "CUSIP" numbers
(if then generally in use), and, if so, the Property Trustee shall use "CUSIP"
numbers in notices of redemption as a convenience to Holders of Preferred
Securities; provided that any such notice may state that no representation is
made as to the correctness of such numbers either as printed on the Preferred
Securities or as contained in any notice of redemption, that reliance may be
placed only on the other identification numbers printed on the Preferred
Securities and that any such redemption shall not be affected by any defect in
or omission of such numbers. The Sponsor will promptly notify the Property
Trustee of any change in the CUSIP numbers.

                                  ARTICLE VIII
                              DISSOLUTION OF TRUST

SECTION 8.1       Dissolution of Trust.

         (a)      The Trust shall automatically dissolve:

                  (i)      upon the bankruptcy of the Sponsor;

                  (ii)     upon the filing of a certificate of dissolution or
liquidation or its equivalent with respect to the Sponsor; or the revocation of
the Sponsor's charter and the expiration of 90 days after the date of revocation
without a reinstatement thereof;

                  (iii)    upon receipt of a written direction from the Sponsor
(which shall be at its sole discretion) while the Debentures are outstanding
requiring the Trustees to dissolve the Trust and, after satisfaction of the
liabilities of the Trust to the creditors of the Trust, distribute a Like Amount
of the Debentures to Holders of the Securities;

                  (iv)     upon the entry of a decree of judicial dissolution of
the Trust by a court of competent jurisdiction;

                                      -35-
<PAGE>

                  (v)      when all of the Securities shall have been called for
redemption and the amounts necessary for redemption thereof shall have been paid
to the Holders in accordance with the terms of the Securities;

                  (vi)     the expiration of the term of the Trust provided in
Section 3.14; or

                  (vii)    [upon the distribution of the Sponsor's [other
securities] to all Holders of Securities upon a conversion or exchange of all
such Securities in accordance with the terms thereof].

         (b)      As soon as is practicable after the occurrence of an event
referred to in Section 8.1(a), after the winding up of the affairs of the Trust
is completed, the Administrative Trustees shall execute and file a certificate
of cancellation with the Secretary of State of the State of Delaware.

         (c)      The provisions of Section 3.9 and Article X shall survive the
termination of the Trust.

                                   ARTICLE IX
                              TRANSFER OF INTERESTS

SECTION 9.1       Transfer of Securities.

         (a)      Securities may be transferred, in whole or in part, only in
accordance with the terms and conditions set forth in this Declaration and in
the terms of the Securities. To the fullest extent permitted by law, any
transfer or purported transfer of any Security not made in accordance with this
Declaration shall be null and void.

         (b)      The Administrative Trustees shall provide for the registration
of Preferred Securities and of the transfer of Preferred Securities, which will
be effected without charge but only upon payment (with such indemnity as the
Administrative Trustees may require) in respect of any tax or other governmental
charges that may be imposed in relation to it. Upon surrender for registration
of transfer of any Preferred Securities, the Administrative Trustees shall cause
one or more new Preferred Securities to be issued in the name of the designated
transferee or transferees. Every Preferred Security surrendered for registration
of transfer shall be accompanied by a written instrument of transfer in form
satisfactory to the Administrative Trustees and the Registrar duly executed by
the Holder or such Holder's attorney duly authorized in writing. Each Preferred
Security surrendered for registration of transfer shall be canceled by the
Property Trustee. A transferee of a Preferred Security shall be entitled to the
rights and subject to the obligations of a Holder hereunder upon the receipt by
such transferee of a Preferred Security. By acceptance of a Preferred Security,
each transferee shall be deemed to have agreed to be bound by this Declaration.

         (c)      For so long as the Trust Securities remain outstanding, the
Sponsor agrees (i) to directly or indirectly maintain 100% direct or indirect
ownership of the Common Securities; provided, however, that any permitted
successor of the Sponsor under the Indenture may succeed to the Sponsor's
ownership of such Common Securities; (ii) to use its reasonable efforts to cause
the Trust (A) to remain a business trust, except in connection with the
distribution of Debentures to the Holders of Trust Securities in dissolution and
liquidation of the Trust, the redemption of all of the Trust Securities or
certain mergers, conversions, consolidations or amalgamations, each as permitted

                                      -36-
<PAGE>

by this Declaration; and (B) to otherwise continue to be classified as a grantor
trust for United States federal income tax purposes; and (iii) to use its
reasonable efforts to cause each Holder of Trust Securities to be treated as
owning an undivided beneficial interest in the Debentures.

SECTION 9.2       Transfer Procedures and Restrictions.

         (a)      When Definitive Preferred Securities are presented to the
Registrar to register the transfer of such Definitive Preferred Securities, the
Registrar shall register the transfer or make the exchange as requested if its
reasonable requirements for such transaction are met; provided, however, that
the Definitive Preferred Securities surrendered for registration of transfer or
exchange shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Administrative Trustees and the
Registrar, duly executed by the Holder thereof or his attorney duly authorized
in writing.

         (b)      A Definitive Preferred Security may not be exchanged for a
beneficial interest in a Global Preferred Security except upon satisfaction of
the requirements set forth below. Upon receipt by the Property Trustee of a
Definitive Preferred Security, duly endorsed or accompanied by appropriate
instruments of transfer, in form satisfactory to the Property Trustee and the
Administrative Trustees, together with written instructions directing the
Property Trustee to make, or to direct the Clearing Agency to make, an
adjustment on its books and records with respect to the appropriate Global
Preferred Security to reflect an increase in the number of the Preferred
Securities represented by such Global Preferred Security, then the Property
Trustee shall cancel such Definitive Preferred Security and cause, or direct the
Clearing Agency to cause, the aggregate number of Preferred Securities
represented by the appropriate Global Preferred Security to be increased
accordingly. If no Global Preferred Securities are then outstanding, the Trust
shall issue and the Property Trustee shall authenticate, upon written order of
any Administrative Trustee, an appropriate number of Preferred Securities in
global form.

         (c)      The transfer and exchange of Global Preferred Securities or
beneficial interests therein shall be effected through the Clearing Agency in
accordance with this Declaration (including applicable restrictions on transfer
set forth herein, if any) and the procedures of the Clearing Agency therefor.
Notwithstanding any other provisions of this Declaration (other than the
provisions set forth in Section 7.9(b)), a Global Preferred Security may not be
transferred as a whole except by the Clearing Agency to a nominee of the
Clearing Agency or another nominee of the Clearing Agency or by the Clearing
Agency or any such nominee to a successor Clearing Agency or a nominee of such
successor Clearing Agency.

         (d)      At such time as all beneficial interests in a Global Preferred
Security have either been exchanged for Definitive Preferred Securities to the
extent permitted by this Declaration or redeemed, repurchased or canceled in
accordance with the terms of this Declaration, such Global Preferred Security
shall be canceled by the Property Trustee. At any time prior to such
cancellation, if any beneficial interest in a Global Preferred Security is
exchanged for Definitive Preferred Securities, Preferred Securities represented
by such Global Preferred Security shall be reduced and an adjustment shall be
made on the books and records of the Clearing Agency and the Registrar to
reflect such reduction.

                                      -37-
<PAGE>

         (e)      Definitive Preferred Securities will only be issued in
exchange for Global Securities as provided in Sections 7.9(b) and (c).

SECTION 9.3       Deemed Security Holders.

         The Trustees may treat the Person in whose name any Security shall be
registered on the books and records of the Trust as the sole owner of such
Security for purposes of receiving Distributions and for all other purposes
whatsoever and, accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such Security on the part of any Person, whether
or not the Trust shall have actual or other notice thereof.

SECTION 9.4       Book Entry Interests.

         Global Preferred Securities shall initially be registered on the books
and records of the Trust in the name of Cede & Co., the nominee of the Clearing
Agency, and no Preferred Security Beneficial Owner will receive a definitive
Preferred Security Certificate representing such Preferred Security Beneficial
Owner's interests in such Global Preferred Securities, except as provided in
Section 7.9 and Section 9.2. Unless and until fully registered Definitive
Preferred Securities certificates have been issued to the Preferred Security
Beneficial Owners pursuant to Section 7.9 and Section 9.2:

         (a)      the provisions of this Section 9.4 shall be in full force and
effect;

         (b)      the Trust and the Trustees shall be entitled to deal with the
Clearing Agency for all purposes of this Declaration (including the payment of
Distributions on the Global Preferred Securities and receiving approvals, votes
or consents hereunder) as the Holder of the Preferred Securities and the sole
holder of the certificate or certificates representing Global Preferred
Securities and shall have no obligation to the Preferred Security Beneficial
Owners;

         (c)      to the extent that the provisions of this Section 9.4 conflict
with any other provisions of this Declaration, the provisions of this Section
9.4 shall control; and

         (d)      the rights of the Preferred Security Beneficial Owners shall
be exercised only through the Clearing Agency and shall be limited to those
established by law and agreements between such Preferred Security Beneficial
Owners and the Clearing Agency or Clearing Agency Participants and the Clearing
Agency shall receive and transmit payments of Distributions on the Global
Preferred Securities to such Clearing Agency Participants; provided that, solely
for the purposes of determining whether the Holders of the requisite amount of
Preferred Securities have voted on any matter provided for in this Declaration,
so long as Definitive Preferred Security certificates have not been issued, the
Trustees may conclusively rely on, and shall be protected in relying on, any
written instrument (including a proxy) delivered to the Trustees by the Clearing
Agency setting forth the Preferred Security Beneficial Owners' votes or
assigning the right to vote on any matter to any other Persons either in whole
or in part. DTC will make book entry transfers among the Clearing Agency
Participants.

                                      -38-
<PAGE>

SECTION 9.5       Notices to Clearing Agency.

         Whenever a notice or other communication to the Preferred Security
Holders is required under this Declaration, the Trustees shall give all such
notices and communications specified herein to be given to the Holders of Global
Preferred Securities to the Clearing Agency, and shall have no notice
obligations to the Preferred Security Beneficial Owners.

SECTION 9.6       Appointment of Successor Clearing Agency.

         If any Clearing Agency elects to discontinue its services as securities
depositary with respect to the Preferred Securities, the Administrative Trustees
may, in their sole discretion, appoint a successor Clearing Agency with respect
to such Preferred Securities.

                                    ARTICLE X
                           LIMITATION OF LIABILITY OF
                   HOLDERS OF SECURITIES, TRUSTEES AND OTHERS

SECTION 10.1      Liability.

         (a)      Except as expressly set forth in this Declaration, the
Securities Guarantees and the terms of the Securities, the Sponsor shall not be:

                  (i)      personally liable for the return of any portion of
the capital contributions (or any return thereon) of the Holders which shall be
made solely from assets of the Trust; or

                  (ii)     required to pay to the Trust or to any Holder any
deficit upon dissolution or termination of the Trust or otherwise.

         (b)      The Debenture Issuer shall be liable for all of the debts and
obligations of the Trust (other than in respect of the payment of principal of
and interest and premium, if any, on the Securities) to the extent not satisfied
out of the Trust's assets.

         (c)      Pursuant to ss. 3803(a) of the Business Trust Act, the Holders
shall be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware.

SECTION 10.2      Exculpation.

         (a)      No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Trust or any Covered Person for any
loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Declaration or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's gross negligence (or, in
the case of the Property Trustee, negligence) or willful misconduct with respect
to such acts or omissions.

                                      -39-
<PAGE>

         (b)      An Indemnified Person shall be fully protected in relying in
good faith upon the records of the Trust and upon such information, opinions,
reports or statements presented to the Trust by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Trust, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders might properly be paid.

SECTION 10.3      Fiduciary Duty.

         (a)      To the extent that, at law or in equity, an Indemnified Person
has duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions of
this Declaration, to the extent that they restrict the duties and liabilities of
an Indemnified Person otherwise existing at law or in equity (other than the
duties imposed on the Property Trustee under the Trust Indenture Act), are
agreed by the parties hereto to replace such other duties and liabilities of
such Indemnified Person.

         (b)      Unless otherwise expressly provided herein:

                  (i)      whenever a conflict of interest exists or arises
between any Covered Person and any Indemnified Person; or

                  (ii)     whenever this Declaration or any other agreement
contemplated herein provides that an Indemnified Person shall act in a manner
that is, or provides terms that are, fair and reasonable to the Trust or any
Holder of Securities, the Indemnified Person shall resolve such conflict of
interest, take such action or provide such terms, considering in each case the
relative interest of each party (including its own interest) to such conflict,
agreement, transaction or situation and the benefits and burdens relating to
such interests, any customary or accepted industry practices, and any applicable
generally accepted accounting practices or principles. In the absence of bad
faith by the Indemnified Person, the resolution, action or terms so made, taken
or provided by the Indemnified Person shall not constitute a breach of this
Declaration or any other agreement contemplated herein or of any duty or
obligation of the Indemnified Person at law or in equity or otherwise.

         (c)      Whenever in this Declaration an Indemnified Person is
permitted or required to make a decision:

                  (i)      in its "discretion" or under a grant of similar
authority, the Indemnified Person shall be entitled to consider such interests
and factors as it desires, including its own interests, and shall have no duty
or obligation to give any consideration to any interest of or factors affecting
the Trust or any other Person; or

                                      -40-
<PAGE>

                  (ii)     in "good faith" or under another express standard,
the Indemnified Person shall act under such express standard and shall not be
subject to any other or different standard imposed by this Declaration.

SECTION 10.4      Indemnification.

         (a)      (i)      The Debenture Issuer shall indemnify, to the fullest
extent permitted by law, any Company Indemnified Person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Trust) by reason of the fact
that he is or was a Company Indemnified Person against expenses (including
attorneys' fees and expenses), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit or
proceeding except that no Company Indemnified Person shall be indemnified for
his own gross negligence or willful misconduct.

         The termination of any action, suit or proceeding by judgment, order,
settlement or conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the Company Indemnified Person
acted with gross negligence or willful misconduct.

                  (ii)     The Debenture Issuer shall indemnify, to the fullest
extent permitted by law, any Company Indemnified Person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action
or suit by or in the right of the Trust to procure a judgment in its favor by
reason of the fact that he is or was a Company Indemnified Person against
expenses (including attorneys' fees and expenses) actually and reasonably
incurred by him in connection with the defense or settlement of such action or
suit except that no Company Indemnified Party shall be indemnified for such
Company Indemnified Party's own gross negligence or willful misconduct and
except that no such indemnification shall be made in respect of any claim, issue
or matter as to which such Company Indemnified Person shall have been adjudged
to be liable to the Trust unless and only to the extent that the Court of
Chancery of Delaware or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, such Person is fairly and reasonably
entitled to indemnity for such expenses as the Court of Chancery or such other
court shall deem proper.

                  (iii)    To the extent that a Company Indemnified Person shall
be successful on the merits or otherwise (including dismissal of an action
without prejudice or the settlement of an action without admission of liability)
in defense of any action, suit or proceeding referred to in paragraphs (i) and
(ii) of this Section 10.4(a), or in defense of any claim, issue or matter
therein, he shall be indemnified, to the fullest extent permitted by law,
against expenses (including attorneys' fees) actually and reasonably incurred by
him in connection therewith.

                  (iv)     Any indemnification under paragraphs (i) and (ii) of
this Section 10.4(a) (unless ordered by a court) shall be made by the Debenture
Issuer only as authorized in the specific case upon a determination that
indemnification of the Company Indemnified Person is proper in the circumstances
because he has met the applicable standard of conduct set forth in paragraphs
(i) and (ii). Such determination shall be made (A) by the Administrative
Trustees by a majority vote of a

                                      -41-
<PAGE>

Quorum consisting of such Administrative Trustees who were not parties to such
action, suit or proceeding; (B) if such a Quorum is not obtainable, or, even if
obtainable, if a Quorum of disinterested Administrative Trustees so directs, by
independent legal counsel in a written opinion; or (C) by the Holder of the
Common Securities.

                  (v)      Expenses (including attorneys' fees and expenses)
incurred by a Company Indemnified Person in defending a civil, criminal,
administrative or investigative action, suit or proceeding referred to in
paragraphs (i) and (ii) of this Section 10.4(a) shall, to the fullest extent
permitted by law, be paid by the Debenture Issuer in advance of the final
disposition of such action, suit or proceeding upon receipt of an undertaking by
or on behalf of such Company Indemnified Person to repay such amount if it shall
ultimately be determined that he is not entitled to be indemnified by the
Debenture Issuer as authorized in this Section 10.4(a). Notwithstanding the
foregoing, no advance shall be made by the Debenture Issuer if a determination
is reasonably and promptly made (A) by the Administrative Trustees by a majority
vote of a Quorum of disinterested Administrative Trustees; (B) if such a Quorum
is not obtainable, or, even if obtainable, if a Quorum of disinterested
Administrative Trustees so directs, by independent legal counsel in a written
opinion; or (C) by the Holder of the Common Securities, that, based upon the
facts known to the Administrative Trustees, counsel or such Holder at the time
such determination is made, such Company Indemnified Person acted with gross
negligence or willful misconduct. In no event shall any advance be made in
instances where the Administrative Trustees, independent legal counsel or the
Holder of the Common Securities reasonably determine that such Person
deliberately breached his duty to the Trust or the Holders of Common or
Preferred Securities.

                  (vi)     The indemnification and advancement of expenses
provided by, or granted pursuant to, the other paragraphs of this Section
10.4(a) shall not be deemed exclusive of any other rights to which those seeking
indemnification and advancement of expenses may be entitled under any agreement,
vote of stockholders or disinterested directors of the Debenture Issuer or
Preferred Security Holders of the Trust or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office. All rights to indemnification under this Section 10.4(a) shall be deemed
to be provided by a contract between the Debenture Issuer and each Company
Indemnified Person who serves in such capacity at any time while this Section
10.4(a) is in effect. Any repeal or modification of this Section 10.4(a) shall
not affect any rights or obligations then existing.

                  (vii)    The Debenture Issuer or the Trust may purchase and
maintain insurance on behalf of any Person who is or was a Company Indemnified
Person against any liability asserted against him and incurred by him in any
such capacity, or arising out of his status as such, whether or not the
Debenture Issuer would have the power to indemnify him against such liability
under the provisions of this Section 10.4(a).

                  (viii)   For purposes of this Section 10.4(a), references to
the "Trust" shall include, in addition to the resulting or surviving entity, any
constituent entity (including any constituent of a constituent) absorbed in a
consolidation or merger, so that any person who is or was a director, trustee,
officer or employee of such constituent entity, or is or was serving at the
request of such constituent entity as a director, trustee, officer, employee or
agent of another entity, shall stand in the same position under the provisions
of this Section 10.4(a) with respect to the resulting or

                                      -42-
<PAGE>

surviving entity as he would have with respect to such constituent entity if its
separate existence had continued.

                  (ix)     The indemnification and advancement of expenses
provided by, or granted pursuant to, this Section 10.4(a) shall, unless
otherwise provided when authorized or ratified, continue as to a person who has
ceased to be a Company Indemnified Person and shall inure to the benefit of the
heirs, executors and administrators of such a person.

         (b)      The Debenture Issuer agrees to indemnify the (i) Property
Trustees; (ii) the Delaware Trustees; (iii) any Affiliate of the Property
Trustee or the Delaware Trustees; and (iv) any officers, directors,
shareholders, members, partners, employees, representatives, custodians,
nominees or agents of the Property Trustee or the Delaware Trustee (each of the
Persons in (i) through (iv) being referred to as a "Fiduciary Indemnified
Person") for, and to hold each Fiduciary Indemnified Person harmless against,
any and all loss, liability, damage, claim or expense including taxes (other
than taxes based on the income of such Fiduciary Indemnified Person) incurred
without gross negligence (or, in the case of the Property Trustee, negligence)
or willful misconduct on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder, including the
costs and expenses (including reasonable legal fees and expenses) of defending
itself against or investigating any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. The provisions
of this Section 10.4(b) shall survive the resignation or removal of the Property
Trustee or the Delaware Trustee and the satisfaction and discharge of this
Declaration.

SECTION 10.5      Outside Businesses.

         Any Covered Person, the Sponsor, the Delaware Trustee and the Property
Trustee (subject to Section 5.3(c)) may engage in or possess an interest in
other business ventures of any nature or description, independently or with
others, similar or dissimilar to the business of the Trust, and the Trust and
the Holders shall have no rights by virtue of this Declaration in and to such
independent ventures or the income or profits derived therefrom, and the pursuit
of any such venture, even if competitive with the business of the Trust, shall
not be deemed wrongful or improper. No Covered Person, the Sponsor, the Delaware
Trustee or the Property Trustee shall be obligated to present any particular
investment or other opportunity to the Trust even if such opportunity is of a
character that, if presented to the Trust, could be taken by the Trust, and any
Covered Person, the Sponsor, the Delaware Trustee and the Property Trustee shall
have the right to take for its own account (individually or as a partner or
fiduciary) or to recommend to others any such particular investment or other
opportunity. Any Covered Person, the Delaware Trustee and the Property Trustee
may engage or be interested in any financial or other transaction with the
Sponsor or any Affiliate of the Sponsor, or may act as depositary for, trustee
or agent for, or act on any committee or body of holders of, securities or other
obligations of the Sponsor or its Affiliates.

                                      -43-
<PAGE>

SECTION 10.6      Compensation; Fees.

         The Debenture Issuer agrees:

         (a)      to pay to the Trustees from time to time such compensation for
all services rendered by them hereunder as the parties shall agree in writing
from time to time (which compensation shall not be limited by any provision of
law in regard to the compensation of a trustee of an express trust); and

         (b)      except as otherwise expressly provided herein, to reimburse
the Trustees upon request for all reasonable expenses, disbursements and
advances incurred or made by the Trustees in accordance with any provision of
this Declaration (including the reasonable compensation and the expenses and
disbursements of their respective agents and counsel), except any such expense,
disbursement or advance as may be attributable to its gross negligence (or, in
the case of the Property Trustee, negligence) or willful misconduct.

         The provisions of this Section 10.6 shall survive the dissolution of
the Trust and the termination of this Declaration and the removal or resignation
of any Trustee.

         No Trustee may claim any lien or charge on any property of the Trust as
a result of any amount due pursuant to this Section 10.6.

                                   ARTICLE XI
                                   ACCOUNTING

SECTION 11.1      Fiscal Year.

         The fiscal year ("Fiscal Year") of the Trust shall be the calendar
year, or such other year as is required by the Code.

SECTION 11.2      Certain Accounting Matters.

         (a)      At all times during the existence of the Trust, the
Administrative Trustees shall keep, or cause to be kept, full books of account,
records and supporting documents, which shall reflect in reasonable detail each
transaction of the Trust. The books of account shall be maintained on the
accrual method of accounting in accordance with generally accepted accounting
principles, consistently applied. The books of account and the records of the
Trust shall be examined by and reported upon as of the end of each Fiscal Year
of the Trust by a firm of independent certified public accountants selected by
the Administrative Trustees.

         (b)      The Administrative Trustees shall cause to be duly prepared
and delivered to each of the Holders, any annual United States federal income
tax information statement required by the Code, containing such information with
regard to the Securities held by each Holder as is required by the Code and the
Treasury Regulations. Notwithstanding any right under the Code to deliver any
such statement at a later date, the Administrative Trustees shall endeavor to
deliver all such information statements within 30 days after the end of each
Fiscal Year of the Trust.

                                      -44-
<PAGE>

         (c)      The Administrative Trustees shall cause to be duly prepared
and filed with the appropriate taxing authority, an annual United States federal
income tax return, on a Form 1041 or such other form required by United States
federal income tax law, and any other annual income tax returns required to be
filed by the Administrative Trustees on behalf of the Trust with any state or
local taxing authority.

SECTION 11.3      Banking.

         The Trust may maintain one or more bank accounts in the name and for
the sole benefit of the Trust; provided, however, that all payments of funds in
respect of the Debentures held by the Property Trustee shall be made directly to
the Property Trustee Account and no other funds of the Trust shall be deposited
in the Property Trustee Account. The sole signatories for such accounts shall be
designated by the Administrative Trustees; provided, however, that the Property
Trustee shall designate the signatories for the Property Trustee Account.

SECTION 11.4      Withholding.

         The Trust and the Administrative Trustees shall comply with all
withholding requirements under United States federal, state and local law. The
Trust shall request, and the Holders shall provide to the Trust, such forms or
certificates as are necessary to establish an exemption from withholding with
respect to each Holder, and any representations and forms as shall reasonably be
requested by the Trust to assist it in determining the extent of, and in
fulfilling, its withholding obligations. The Administrative Trustees shall file
required forms with applicable jurisdictions and, unless an exemption from
withholding is properly established by a Holder, shall remit amounts withheld
with respect to such Holder to applicable jurisdictions. To the extent that the
Trust is required to withhold and pay over any amounts to any authority with
respect to Distributions or allocations to any Holder, the amount withheld shall
be deemed to be a Distribution in the amount of the withholding to the Holder.
In the event of any claimed over withholding, Holders shall be limited to an
action against the applicable jurisdiction. If the amount required to be
withheld was not withheld from actual Distributions made, the Trust may reduce
subsequent Distributions by the amount of such withholding.

                                   ARTICLE XII
                             AMENDMENTS AND MEETINGS

SECTION 12.1      Amendments.

         (a)      Except as otherwise provided in this Declaration (including
Section 8 of Annex I hereto) or by any applicable terms of the Securities, this
Declaration may only be amended by a written instrument approved and executed by
the Administrative Trustees (or if there are more than two Administrative
Trustees a majority of the Administrative Trustees); and

                  (i)      if the amendment affects the rights, powers, duties,
obligations or immunities of the Property Trustee, also by the Property Trustee;
and

                  (ii)     if the amendment affects the rights, powers, duties,
obligations or immunities of the Delaware Trustee, also by the Delaware Trustee.

                                      -45-
<PAGE>

         (b)      No amendment shall be made, and any such purported amendment
shall be void and ineffective, unless the Property Trustee shall have first
received: (i) an Officers' Certificate from each of the Trust and the Sponsor
that such amendment is permitted by, and conforms to, the terms of this
Declaration (including the terms of the Securities); and (ii) an Opinion of
Counsel (who may be counsel to the Sponsor or the Trust) that such amendment is
permitted by, and conforms to, the terms of this Declaration (including the
terms of the Securities) and that all conditions precedent, if any, in this
Declaration to the execution and delivery of such amendment have been satisfied;
provided, however, that the Property Trustee shall not be required to sign any
such amendment that affects the rights, powers, duties, obligations or
immunities of the Property Trustee.

         (c)      At such time after the Trust has issued any Securities that
remain outstanding, any amendment that would adversely affect the rights,
privileges or preferences of any Holder may be effected only with such
additional requirements as may be set forth in the terms of such Securities.

         (d)      This Section 12.1 shall not be amended without the consent of
all of the Holders.

         (e)      Article Four shall not be amended without the consent of the
Holders of a Majority in Liquidation Amount of the Common Securities.

         (f)      The rights of the Holders of the Common Securities under
Article Five to increase or decrease the number of, and appoint and remove
Trustees shall not be amended without the consent of the Holders of a Majority
in Liquidation Amount of the Common Securities.

         (g)      Notwithstanding Section 12.1(c), this Declaration may be
amended without the consent of the Holders to:

                  (i)      cure any ambiguity, correct or supplement any
provision in this Declaration that may be inconsistent with any other provision
of this Declaration or to make any other provisions with respect to matters or
questions arising under this Declaration which shall not be inconsistent with
the other provisions of the Declaration;

                  (ii)     to modify, eliminate or add to any provisions of the
Declaration to such extent as shall be necessary to ensure that the Trust will
be classified for United States federal income tax purposes as a grantor trust
at all times that any Securities are outstanding or to ensure that the Trust
will not be required to register as an Investment Company under the Investment
Company Act;

                  (iii)    to evidence the acceptance of the appointment of a
successor Trustee or to fill a vacancy created by an increase in the number of
Administrative Trustees; or

                  (iv)     add to the covenants, restrictions or obligations of
the Sponsor;

provided, however, that in the case of clauses (i) or (ii) above such action
shall not adversely affect in any material respect the interests of the Holders,
and any such amendments of this Declaration shall become effective when notice
thereof is given to the Holders.

SECTION 12.2      Meetings of the Holders; Action by Written Consent.

                                      -46-
<PAGE>

         (a)      Meetings of the Holders of any class of Securities may be
called at any time by the Administrative Trustees (or as provided in the terms
of the Securities) to consider and act on any matter on which Holders of such
class of Securities are entitled to act under the terms of this Declaration, the
terms of the Securities or the rules of any stock exchange on which the
Preferred Securities are listed or admitted for trading. The Administrative
Trustees shall call a meeting of the Holders of such class if directed to do so
by the Holders of at least 25% in Liquidation Amount of such class of
Securities. Such direction shall be given by delivering to the Administrative
Trustees one or more notices in writing stating that the signing Holders wish to
call a meeting and indicating the general or specific purpose for which the
meeting is to be called. Any Holders calling a meeting shall specify in writing
the Security Certificates held by the Holders exercising the right to call a
meeting and only those Securities specified shall be counted for purposes of
determining whether the required percentage set forth in the second sentence of
this paragraph has been met.

         (b)      Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders:

                  (i)      notice of any such meeting shall be given to all the
Holders having a right to vote thereat at least seven days and not more than 60
days before the date of such meeting. Whenever a vote, consent or approval of
the Holders is permitted or required under this Declaration or the rules of any
stock exchange on which the Preferred Securities are listed or admitted for
trading, such vote, consent or approval may be given at a meeting of the
Holders. Any action that may be taken at a meeting of the Holders may be taken
without a meeting and without prior notice if a consent in writing setting forth
the action so taken is signed by the Holders owning not less than the minimum
amount of Securities in Liquidation Amount that would be necessary to authorize
or take such action at a meeting at which all Holders having a right to vote
thereon were present and voting. Prompt notice of the taking of action without a
meeting shall be given to the Holders entitled to vote who have not consented in
writing. The Administrative Trustees may specify that any written ballot
submitted to a Holder for the purpose of taking any action without a meeting
shall be returned to the Trust within the time specified by the Administrative
Trustees;

                  (ii)     each Holder may authorize any Person to act for it by
proxy on all matters in which a Holder is entitled to participate, including
waiving notice of any meeting or voting or participating at a meeting. No proxy
shall be valid after the expiration of 11 months from the date thereof unless
otherwise provided in the proxy. Every proxy shall be revocable at the pleasure
of the Holder executing it. Except as otherwise provided herein, all matters
relating to the giving, voting or validity of proxies shall be governed by the
General Corporation Law of the State of Delaware relating to proxies, and
judicial interpretations thereunder, as if the Trust were a Delaware corporation
and the Holders were stockholders of a Delaware corporation;

                  (iii)    each meeting of the Holders shall be conducted by the
Administrative Trustees or by such other Person that the Administrative Trustees
may designate; and

                  (iv)     unless the Business Trust Act, this Declaration, the
terms of the Securities, the Trust Indenture Act or the listing rules of any
stock exchange on which the Preferred Securities are then listed or trading,
otherwise provides, the Administrative Trustees, in their sole discretion, shall
establish all other provisions relating to meetings of Holders, including notice
of the time, place

                                      -47-
<PAGE>

or purpose of any meeting at which any matter is to be voted on by any Holders,
waiver of any such notice, action by consent without a meeting, the
establishment of a record date, quorum requirements, voting in person or by
proxy or any other matter with respect to the exercise of any such right to
vote.

                                  ARTICLE XIII
                       REPRESENTATIONS OF PROPERTY TRUSTEE
                              AND DELAWARE TRUSTEE

SECTION 13.1      Representations and Warranties of Property Trustee.

         The Trustee that acts as initial Property Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Property Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Property Trustee's acceptance of its
appointment as Property Trustee that:

         (a)      the Property Trustee is a nation banking association, a
national banking association or a bank or trust company organized under the laws
of any state of the United States or the District of Columbia, in any case with
trust powers and authority to execute and deliver, and to carry out and perform
its obligations under the terms of, this Declaration;

         (b)      the execution, delivery and performance by the Property
Trustee of this Declaration have been duly authorized by all necessary corporate
action on the part of the Property Trustee;

         (c)      this Declaration has been duly executed and delivered by the
Property Trustee and constitutes a legal, valid and binding obligation of the
Property Trustee, enforceable against it in accordance with its terms, subject
to applicable bankruptcy, reorganization, moratorium, insolvency and other
similar laws affecting creditors' rights generally and to general principles of
equity and the discretion of the court (regardless of whether the enforcement of
such remedies is considered in a proceeding in equity or at law);

         (d)      the execution, delivery and performance of this Declaration by
the Property Trustee do not conflict with or constitute a breach of the charter
or by-laws of the Property Trustee;

         (e)      no consent, approval or authorization of, or registration with
                  or notice to, any applicable state or federal banking
authority is required for the execution, delivery or performance by the Property
Trustee of this Declaration; and

         (f)      the Property Trustee satisfies the requirements set forth in
Section 5.3(a).

SECTION 13.2      Representations and Warranties of Delaware Trustee.

         The Trustee that acts as initial Delaware Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Delaware Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:

                                      -48-
<PAGE>

         (a)      the Delaware Trustee is a Delaware corporation, duly
organized, validly existing and in good standing under the federal laws of the
United States, with power and authority to execute and deliver, and to carry out
and perform its obligations under the terms of, this Declaration;

         (b)      the execution, delivery and performance by the Delaware
Trustee of this Declaration have been duly authorized by all necessary action on
the part of the Delaware Trustee;

         (c)      this Declaration has been duly executed and delivered by the
Delaware Trustee and constitutes a legal, valid and binding obligation of the
Delaware Trustee, enforceable against it in accordance with its terms, subject
to applicable bankruptcy, reorganization, moratorium, insolvency and other
similar laws affecting creditors' rights generally and to general principles of
equity and the discretion of the court (regardless of whether the enforcement of
such remedies is considered in a proceeding in equity or at law);

         (d)      no consent, approval or authorization of, or registration with
or notice to, any state or federal banking authority is required for the
execution, delivery or performance by the Delaware Trustee of this Declaration;
and

         (e)      the Delaware Trustee is a natural person who is a resident of
the State of Delaware or, if not a natural person, an entity that has its
principal place of business in the State of Delaware and is a Person that
satisfies for the Trust section 3807(a) of the Business Trust Act.

                                   ARTICLE XIV
                                  MISCELLANEOUS

SECTION 14.1      Notices.

         All notices provided for in this Declaration shall be in writing, duly
signed by the party giving such notice, and shall be delivered, telecopied or
mailed by first class mail, overnight courier service or confirmed facsimile, as
follows:

         (a)      if given to the Trust, in care of the Administrative Trustees
at the Trust's mailing address or facsimile number set forth below (or such
other address or facsimile number as the Trust may give notice of to the
Property Trustee, the Delaware Trustee and the Holders):

         Dynegy Capital Trust III
         c/o Dynegy Inc.
         1000 Louisiana, Suite 5800
         Houston, Texas 77002
         Attention: ___________
         Facsimile: (___) ______

                                      -49-
<PAGE>

         (b)      if given to the Delaware Trustee, at the mailing address or
facsimile number set forth below (or such other address or facsimile number as
Delaware Trustee may give notice of to the Holders):

         Bank One Delaware, Inc.
         3 Christina Centre
         201 North Walnut Street
         Wilmington, Delaware 19801-2920
         Attention: ___________
         Facsimile: (___) ______

         (c)      if given to the Property Trustee, at the Property Trustee's
mailing address or facsimile number set forth below (or such other address or
facsimile number as the Property Trustee may give notice of to the Holders):

         Bank One Trust Company, National Association
         1 Bank One Plaza
         Suite IL1 0126
         Chicago, Illinois 60670-0126
         Attention: Corporate Trust Services Division
         Facsimile: (312) 407-1708

         (d)      if given to the Holder of the Common Securities, at the
mailing address or facsimile number of the Sponsor set forth below (or such
other address or facsimile number as the Holder of the Common Securities may
give notice to the Property Trustee and the Trust):

         Dynegy Inc.
         1000 Louisiana, Suite 5800
         Houston, Texas 77002
         Attention: Kenneth E. Randolph
         Facsimile: (713) 507-6808

         (e)      if given to any other Holder, at the address set forth on the
books and records of the Trust.

         All such notices shall be deemed to have been given when received in
person, sent by facsimile with receipt confirmed or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address or facsimile number of which
no notice was given, such notice or other document shall be deemed to have been
delivered on the date of such refusal or inability to deliver.

SECTION 14.2      GOVERNING LAW.

THIS DECLARATION AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THE
HOLDERS OF THE SECURITIES SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF DELAWARE AND

                                      -50-
<PAGE>

ALL RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH LAWS WITHOUT REGARD TO THE
PRINCIPLES OF CONFLICT OF LAWS OF THE STATE OF DELAWARE OR ANY OTHER
JURISDICTION THAT WOULD CALL FOR THE APPLICATION OF THE LAW OF ANY JURISDICTION
OTHER THAN THE STATE OF DELAWARE; PROVIDED, HOWEVER, THAT THERE SHALL NOT BE
APPLICABLE TO THE PARTIES HEREUNDER OR THIS DECLARATION ANY PROVISION OF THE
LAWS (STATUTORY OR COMMON) OF THE STATE OF DELAWARE PERTAINING TO TRUSTS THAT
RELATE TO OR REGULATE, IN A MANNER INCONSISTENT WITH THE TERMS HEREOF (A) THE
FILING WITH ANY COURT OR GOVERNMENTAL BODY OR AGENCY OF TRUSTEE ACCOUNTS OR
SCHEDULES OF TRUSTEE FEES AND CHARGES, (B) AFFIRMATIVE REQUIREMENTS TO POST
BONDS FOR TRUSTEES, OFFICERS, AGENTS OR EMPLOYEES OF A TRUST, (C) THE NECESSITY
FOR OBTAINING COURT OR OTHER GOVERNMENTAL APPROVAL CONCERNING THE ACQUISITION,
HOLDING OR DISPOSITION OF REAL OR PERSONAL PROPERTY, (D) FEES OR OTHER SUMS
PAYABLE TO TRUSTEES, OFFICERS, AGENTS OR EMPLOYEES OF A TRUST, (E) THE
ALLOCATION OF RECEIPTS AND EXPENDITURES TO INCOME OR PRINCIPAL, (F) RESTRICTIONS
OR LIMITATIONS ON THE PERMISSIBLE NATURE, AMOUNT OR CONCENTRATION OF TRUST
INVESTMENTS OR REQUIREMENTS RELATING TO THE TITLING, STORAGE OR OTHER MANNER OF
HOLDING OR INVESTING TRUST ASSETS OR (G) THE ESTABLISHMENT OF FIDUCIARY OR OTHER
STANDARDS OF RESPONSIBILITY OR LIMITATIONS ON THE ACTS OR POWERS OF TRUSTEES
THAT ARE INCONSISTENT WITH THE LIMITATIONS OR LIABILITIES OR AUTHORITIES AND
POWERS OF THE TRUSTEES HEREUNDER AS SET FORTH OR REFERENCED IN THIS DECLARATION.
SECTION 3540 OF TITLE 12 OF THE DELAWARE CODE SHALL NOT APPLY TO THE TRUST.

SECTION 14.3      Intention of the Parties.

         It is the intention of the parties hereto that the Trust be classified
for United States federal income tax purposes as a grantor trust. The provisions
of this Declaration shall be interpreted to further this intention of the
parties.

SECTION 14.4      Headings.

         Headings contained in this Declaration are inserted for convenience of
reference only and do not affect the interpretation of this Declaration or any
provision hereof.

SECTION 14.5      Successors and Assigns.

         Whenever in this Declaration any of the parties hereto is named or
referred to, the successors and assigns of such party shall be deemed to be
included, and all covenants and agreements in this Declaration by the Sponsor
and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether or not so expressed.

SECTION 14.6      Partial Enforceability.

                                      -51-
<PAGE>

         If any provision of this Declaration, or the application of such
provision to any Person or circumstance, shall be held invalid, the remainder of
this Declaration, or the application of such provision to persons or
circumstances other than those to which it is held invalid, shall not be
affected thereby.

SECTION 14.7      Counterparts.

         This Declaration may contain more than one counterpart of the signature
page and this Declaration may be executed by the affixing of the signature of
each of the Trustees and the Sponsor to one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though all of the signers had signed a
single signature page.

SECTION 14.8      No Recourse.

         The Trust's obligations hereunder are intended to be the obligations of
the Trust and no recourse for the payment of Distributions (including additional
distributions, if applicable) on, and the Redemption Price (as defined in
Section 4(a) of Annex I hereto) of, Securities, as applicable, or for any claim
upon the Securities or otherwise in respect thereof, shall be had against any
Holder of Preferred Securities or any Affiliate of a Holder of Preferred
Securities, solely by reason of such Person being a Holder of Preferred
Securities or an Affiliate of a Holder of Preferred Securities, it being
understood that the Holders of Preferred Securities, solely by reason of being a
Holder of Preferred Securities, have limited liability (in accordance with the
provisions of the Business Trust Act) for the liabilities and obligations of the
Trust. Nothing contained in this Section 14.8 shall be construed to limit the
exercise or enforcement, in accordance with the terms of this Declaration, the
Preferred Securities Guarantee, the Common Securities Guarantee and the
Indenture, of rights and remedies against the Trust or the Sponsor.

                                      -52-
<PAGE>

         IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.

                                       _________________________________________
                                       Robert T. Ray, as Administrative Trustee

                                       _________________________________________
                                       ______________, as Administrative Trustee

                                       _________________________________________
                                       ______________, as Administrative Trustee

                                       BANK ONE DELAWARE, INC.,
                                       as Delaware Trustee

                                       By:______________________________________
                                       Name:____________________________________
                                       Title:___________________________________

                                       BANK ONE TRUST COMPANY,
                                       NATIONAL ASSOCIATION,
                                       as Property Trustee

                                       By:______________________________________
                                       Name:____________________________________
                                       Title:___________________________________

                                       DYNEGY INC.,
                                       as Sponsor and Debenture Issuer

                                       By:______________________________________
                                       Name:____________________________________
                                       Title:___________________________________

                                      -53-
<PAGE>

                                     ANNEX I

                                    TERMS OF
                           ____% PREFERRED SECURITIES
                             ____% COMMON SECURITIES

         Pursuant to Section 7.1 of the Amended and Restated Declaration of
Trust, dated as of ________, ___ (as amended from time to time, the
"Declaration"), the designation, rights, privileges, restrictions, preferences
and other terms and provisions of the Securities are set out below (each
capitalized term used but not defined herein has the meaning set forth in the
Declaration or, if not defined in the Declaration, as defined in the Indenture:

1.   Designation and Number.

         (a)      Preferred Securities. _______ Preferred Securities of the
Trust, with an aggregate Liquidation Amount with respect to the assets of the
Trust of $________ and with a Liquidation Amount with respect to the assets of
the Trust of $_________ per Security, are hereby designated for the purposes of
identification only as "[ ]% Preferred Securities" (the "Preferred Securities").
The certificates evidencing the Preferred Securities shall be substantially in
the form of Exhibit A-1 to the Declaration, with such changes and additions
thereto or deletions therefrom as may be required by ordinary usage, custom or
practice or to conform to the rules of any stock exchange or quotation system on
which the Preferred Securities are listed, traded or quoted.

         (b)      Common Securities. ______ Common Securities of the Trust with
an aggregate Liquidation Amount with respect to the assets of the Trust of
$_______ and with a Liquidation Amount with respect to the assets of the Trust
of $______ per Security, are hereby designated for the purposes of
identification only as "[ ]% Common Securities" (the "Common Securities"). The
certificates evidencing the Common Securities shall be substantially in the form
of Exhibit A-2 to the Declaration, with such changes and additions thereto or
deletions therefrom as may be required by ordinary usage, custom or practice.

2.   Distributions.

         (a)      Distributions payable on each Security will be fixed at a rate
per annum of _____% (the "Coupon Rate") of the Liquidation Amount of $______ per
Security (the "Liquidation Amount"), such rate being the rate of interest
payable on the Debentures to be held by the Property Trustee. Distributions in
arrears for more than one [semi-annual] period will bear additional
distributions thereon compounded [semi-annually] at the Coupon Rate (to the
extent permitted by applicable law). The term "Distributions," as used herein,
includes any such additional distributions unless otherwise stated. A
Distribution is payable only to the extent that payments are made in respect of
the Debentures held by the Property Trustee and to the extent the Property
Trustee has funds on hand legally available therefor.

         (b)      Distributions on the Securities will be cumulative, will
accumulate from the most recent date to which Distributions have been paid or,
if no Distributions have been paid, from and including [_______], but excluding
the related Distribution Date (as defined below) or the date of

                                    ANNEX I-1
<PAGE>

redemption, and will be payable [semi-annually] in arrears on [_______] and
[________] of each year, commencing on [__________________], except as otherwise
described below. The amount of Distributions payable for any period will be
computed on the basis of a 360-day year consisting of twelve 30-day months and
for any period of less than a full calendar month on the basis of the actual
number of days elapsed in such month. If any date on which Distributions are
payable on the Securities is not a Business Day, then payment of the
Distribution payable on such date shall be made on the next succeeding day that
is a Business Day (and without any interest or other payment in respect of any
such delay), except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on the date such
payment was originally payable (each date on which Distributions are payable in
accordance with the foregoing, a "Distribution Date").

         [So long as no Event of Default (as defined in the Indenture) has
occurred and is continuing, the Debenture Issuer has the right under the
Indenture to defer the payment of interest on the Debentures by extending the
interest payment period at any time and from time to time for a period not
exceeding [___] consecutive [semi-annual] periods, including the first such
[semi-annual] period during such period (each an "Extension Period"), provided
that no Extension Period shall extend beyond the Maturity Date of the
Debentures. Distributions will be deferred during any Extension Period.
Notwithstanding such deferral, Distributions to which Holders are entitled shall
continue to accumulate additional Distributions thereon (to the extent permitted
by applicable law but not at a rate greater than the rate at which interest is
then accruing on the Debentures) at the Coupon Rate compounded [semi-annually]
from the relevant Distribution Dates during any Extension Period. Prior to the
expiration of any Extension Period, the Debenture Issuer may further defer
payments of interest by further extending such Extension Period; provided that
such Extension Period, together with all previous and further extensions, if
any, within such Extension Period, may not exceed [___] consecutive
[semi-annual] periods, including the first [semi-annual] period during such
Extension Period, or extend beyond the Maturity Date of the Debentures. Upon the
expiration of any Extension Period and the payment of all amounts then due, the
Debenture Issuer may commence a new Extension Period, subject to the above
requirements. [Payments of Distributions that have accumulated but not been paid
during any Extension Period will be payable to Holders as they appear on the
books and records of the Trust on the record date for the first scheduled
Distribution Date following the expiration of such Extension Period and prior to
the commencement of any new Extension Period.] The Debenture Issuer must give
the Property Trustee, the Administrative Trustees and the Debenture Trustee
notice of its election of any Extension Period or any extension thereof at least
one Business Day prior to the earlier of (i) the date the Distributions on the
Preferred Securities would have been payable except for the election to begin or
extend such Extension Period and (ii) the date the Administrative Trustees are
required to give notice to any securities exchange or to Holders of the
Preferred Securities of the record date or the date such Distributions are
payable, but in any event not less than one Business Day prior to such record
date. There is no limitation on the number of times that the Debenture Issuer
may elect to begin an Extension Period.]

         (c)      Distributions on the Securities will be payable to the Holders
thereof as they appear on the books and records of the Trust on the record
dates, which shall be [the Business Day prior to the relevant Distribution date
as long as the Preferred Securities are held in global form by a Clearing
Agency, and the 15th day of the last month in each distribution period (even if
not a Business Day) if

                                    ANNEX I-2
<PAGE>

the Preferred Securities are issued in certificated form]. Subject to any
applicable laws and regulations and the provisions of the Declaration, each such
payment in respect of the Preferred Securities will be made as follows: (i) if
the Preferred Securities are held in global form by a Clearing Agency (or its
nominee), in accordance with the procedures of the Clearing Agency; and (ii) if
the Preferred Securities are held in definitive form, by check mailed to the
address of the Holder thereof as reflected in the records of the Registrar
unless otherwise agreed by the Trust. The relevant record dates for the Common
Securities shall be the same as the record dates for the Preferred Securities.
Distributions payable on any Securities that are not punctually paid on any
Distribution Date will cease to be payable to the Holder on the relevant record
date, and such defaulted Distribution will instead be payable to the Person in
whose name such Securities are registered on the special record date or other
specified date determined in accordance with the Indenture.

         (d)      [In the event of an election by the Holder to convert its
Securities through the Conversion Agent into [other securities] pursuant to the
terms of the Securities as set forth in this Annex I to the Declaration, no
payment, allowance or adjustment shall be made with respect to accumulated and
unpaid Distributions on such Securities, or be required to be made; provided
that Holders of Securities at the close of business on any record date for the
payment of Distributions will be entitled to receive the Distributions payable
on such Securities on the corresponding payment date notwithstanding the
conversion of such Securities into [securities] following such record date.]

         (e)      In the event that there is any money or other property held by
or for the Trust that is not accounted for hereunder, such property shall be
distributed Pro Rata (as defined herein) among the Holders of the Securities.

3.   Liquidation Distribution Upon Dissolution.

         [The Debenture Issuer will have the right at any time to dissolve the
Trust and, after satisfaction of the liabilities of the Trust to creditors of
the Trust, cause the Debentures to be distributed to the Holders of the Trust
Securities in Liquidation of the Trust].

         In the event of any dissolution of the Trust pursuant to Sections
8.1(a)(i), (ii), (iv) or (vi) of the Declaration, the Trust shall be liquidated
by the Administrative Trustees as expeditiously as the Administrative Trustees
determine to be possible by distributing, after satisfaction of liabilities to
creditors of the Trust as provided by applicable law, to the Holders of the
Securities a Like Amount (as defined below) of the Debentures, unless such
Distribution is determined by the Property Trustee not to be practicable, in
which event such Holders will be entitled to receive out of the assets of the
Trust legally available for Distribution to Holders, after satisfaction of
liabilities to creditors of the Trust as provided by applicable law, an amount
equal to the aggregate of the Liquidation Amount of $_____ per Security plus
accumulated and unpaid Distributions thereon to the date of payment (such amount
being the "Liquidation Distribution").

         "Like Amount" means (i) with respect to a redemption of the Securities,
Securities having a Liquidation Amount equal to the principal amount of
Debentures to be paid in accordance with their terms; and (ii) with respect to a
distribution of Debentures upon the dissolution of the Trust, Debentures having
a principal amount equal to the Liquidation Amount of the Securities of the
Holder to whom such Debentures are distributed.

                                    ANNEX I-3
<PAGE>

         On and from the date fixed by the Administrative Trustees for any
distribution of Debentures and dissolution of the Trust: (i) the Securities will
no longer be deemed to be outstanding; (ii) the Clearing Agency or its nominee,
as the Holder of the Securities, will receive a registered global certificate or
certificates representing the Debentures to be delivered upon such distribution;
and (iii) any Securities not held by the Clearing Agency or its nominee will be
deemed to represent beneficial interests in a Like Amount of Debentures, and
bearing accrued and unpaid interest in an amount equal to the accumulated and
unpaid Distributions on such Securities, until such Securities are presented to
the Registrar or its agent for cancellation, whereupon the Debenture Issuer will
issue, and the Debenture Trustee will authenticate, a certificate representing
such Debentures.

         If, upon any such liquidation, the Liquidation Distribution can be paid
only in part because the Trust has insufficient assets on hand legally available
to pay in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Securities shall be paid on a Pro Rata basis.

4.   Redemption and Distribution.

         (a)      Upon the repayment of the Debentures on the Maturity Date
thereof [or redemption thereof (in whole or in part) prior thereto in accordance
with the terms thereof], the proceeds from such repayment or redemption shall be
simultaneously applied by the Property Trustee (subject to the Property Trustee
having received notice no later than 45 days prior to such repayment or
redemption) to redeem a Like Amount of the Securities at a redemption price
equal to (i) in the case of the repayment of the Debentures on the Maturity
Date, the Maturity Redemption Price (as defined below), [(ii) in the case of the
optional redemption of the Debentures prior to [___________] upon the occurrence
and continuation of a [Special Event] (as defined below), the Special Event
Redemption Price (as defined below)] and [(iii) in the case of the optional
redemption of the Debentures other than as contemplated in clause (ii) above,
the Optional Redemption Price (as defined below)]. The [Maturity Redemption
Price, the Special Event Redemption Price and the Optional Redemption Price] are
referred to collectively as the "Redemption Price."

         (b)      (i)      "Maturity Redemption Price" means a price equal to
100% of the Liquidation Amount of the Securities to be redeemed plus accumulated
and unpaid Distributions thereon, if any, to the date of redemption.

                  [(ii)    "Optional Redemption Price" means a price equal to
the percentage of the Liquidation Amount of Securities to be redeemed plus
accumulated and unpaid Distributions thereon, if any, to the date of such
redemption if redeemed during the 12 month period beginning [______] of the
years indicated below:

         Year              Percentage

                           _____%

         and thereafter at 100% of the Liquidation Amount of Securities to be
redeemed.].

                  [(iii)   "Special Event Redemption Price" means a price equal
to [__________], plus, in either case, accumulated and unpaid Distributions
thereon, if any, to the date of such redemption.]

                                    ANNEX I-4
<PAGE>

                  [(iv)    "Special Event" means _____________________________.]

         (c)      The Trust may not redeem fewer than all the outstanding
Securities unless all accumulated and unpaid Distributions have been paid on all
Securities for all Distribution periods that expire on or before the date of
redemption.

         (d)      The procedure with respect to redemptions or distributions of
Securities or Debentures shall be as follows:

                  (i)      Notice of any redemption of, or notice of
distribution of Debentures in exchange for, the Securities (a
"Redemption/Distribution Notice") will be given by the Trust by mail to each
Holder to be redeemed or exchanged not fewer than 30 nor more than 60 days
before the date fixed for redemption or exchange thereof which, in the case of a
redemption, will be the date fixed for repayment or redemption of the
Debentures. For purposes of the calculation of the date of redemption or
exchange and the dates on which notices are given pursuant to this Section
4(d)(i), a Redemption/Distribution Notice shall be deemed to be given on the day
such notice is first mailed by first-class mail, postage prepaid, to Holders.
Each Redemption/Distribution Notice shall be addressed to the Holders at the
address of each such Holder appearing in the books and records of the Trust. No
defect in the Redemption/Distribution Notice or in the mailing thereof with
respect to any Holder shall affect the validity of the redemption or exchange
proceedings with respect to any other Holder.

                  (ii)     In the event that fewer than all the outstanding
Securities are to be redeemed, the Securities to be redeemed shall be redeemed
Pro Rata from each Holder, it being understood that, in respect of Preferred
Securities registered in the name of and held of record by a Clearing Agency or
its nominee, the distribution of the proceeds of such redemption will be made to
the Clearing Agency or its nominee and disbursed by such Clearing Agency in
accordance with the procedures applied by such agency or nominee.

                  (iii)    If Securities are to be redeemed and the Trust gives
a Redemption/Distribution Notice, such notice shall be irrevocable and (A) with
respect to Preferred Securities registered in the name of or held of record by a
Clearing Agency or its nominee, by 12:00 noon, New York City time, on the
redemption date, provided that the Debenture Issuer has paid the Property
Trustee a sufficient amount of cash in connection with the related maturity or
redemption of the Debentures by 10:00 a.m., New York City time, on the Maturity
Date or the date of redemption, as the case may be, the Property Trustee or the
Paying Agent will pay to the Clearing Agency or its nominee funds sufficient to
pay the applicable Redemption Price with respect to such Preferred Securities,
and (B) with respect to Preferred Securities issued in certificated form and
Common Securities, provided that the Debenture Issuer has paid the Property
Trustee a sufficient amount of cash in connection with the related maturity or
redemption of the Debentures, the Property Trustee or the Paying Agent will pay
the relevant Redemption Price to the Holders of such Securities against
presentation to the Registrar of the certificates therefor. If a
Redemption/Distribution Notice shall have been given and funds deposited with
the Property Trustee to pay the Redemption Price (including all unpaid
Distributions) with respect to the Securities called for redemption, then
immediately prior to the close of business on the redemption date, Distributions
will cease to accumulate on the Securities so called for redemption and all
rights of Holders of such Securities so called for redemption will cease, except

                                    ANNEX I-5
<PAGE>

the right of the Holders of such Securities to receive the Redemption Price, but
without interest on such Redemption Price, and such Securities shall cease to be
outstanding.

                  (iv)     Payment of accumulated and unpaid Distributions on
the redemption date of any Securities will be subject to the rights of Holders
of such Securities on the close of business on a regular record date in respect
of a Distribution Date occurring on or prior to such Redemption Date.

                  (v)      Neither the Administrative Trustees nor the Trust
shall be required to register or cause to be registered the transfer of (A) any
Securities beginning on the opening of business 15 days before the day of
mailing of a Redemption/Distribution Notice; or (B) any Securities selected for
redemption (except the unredeemed portion of any Security being redeemed). If
any date fixed for redemption of Securities is not a Business Day, then payment
of the Redemption Price payable on such date will be made on the next succeeding
day that is a Business Day (and without any interest or other payment in respect
of any such delay) except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on such date fixed
for redemption. If payment of the Redemption Price in respect of any Securities
is improperly withheld or refused and not paid on the date fixed for redemption
either by the Property Trustee or the Paying Agent or by the Sponsor as
guarantor pursuant to the Preferred Securities Guarantee, on the date fixed for
redemption, (A) Distributions on such Securities will continue to accumulate
from such redemption date to the actual date of payment; and (B) the actual
payment date will be considered the date fixed for redemption for purposes of
calculating the Redemption Price.

                  (vi)     Subject to the foregoing and applicable law
(including, without limitation, United States federal securities laws), the
Sponsor or any of its Affiliates may at any time and from time to time purchase
outstanding Preferred Securities by tender, in the open market or by private
agreement.

5.       Conversion Rights.

         The Holders shall have the right at any time, beginning ____________
through the close of business on ____________ (or, in the case of Securities
called for redemption, prior to the close of business on the Business Day prior
to the redemption date), at their option, to cause the Conversion Agent to
convert Securities, on behalf of the converting Holders, into [other securities]
in the manner described herein on and subject to the following terms and
conditions:

         (a)      The Securities will be convertible or exchangeable at the
office of the Conversion Agent into fully paid and nonassessable [other
securities] pursuant to the Holder's direction to the Conversion Agent [in the
form of Exhibit ___ hereto] to exchange such Securities for a portion of the
Debentures theretofore held by the Trust on the basis of one Security per $____
principal amount of Debentures, and immediately convert such amount of
Debentures into fully paid and nonassessable [other securities] at an initial
rate of _______________ per $________ principal amount of Debentures (which is
equivalent to a conversion price of $ ____per [other Sponsor security], subject
to certain adjustments set forth in Article XIII of the Indenture (as so
adjusted, the "Conversion Price")).

                                    ANNEX I-6
<PAGE>

         (b)      In order to convert Securities into [other securities] the
Holder shall submit to the Conversion Agent at the office referred to above an
irrevocable request to convert Securities on behalf of such Holder (the
"Conversion Request"), together, if the Securities are in certificated form,
with such certificates. The Conversion Request shall (i) set forth the number of
Securities to be converted and the name or names, if other than the Holder, in
which the [other securities] should be issued and (ii) direct the Conversion
Agent to (A) exchange such Securities for a portion of the Debentures held by
the Trust (at the rate of exchange specified in the preceding paragraph); and
(B) to immediately convert such Debentures on behalf of such Holder into [other
securities] (at the conversion rate specified in the preceding paragraph). The
Conversion Agent shall notify the Trust of the Holder's election to exchange
Securities for a portion of the Debentures held by the Trust (a "Notice of
Conversion") and the Trust shall, upon receipt of such notice, deliver to the
Conversion Agent the appropriate principal amount of Debentures for exchange in
accordance with this Section. The Conversion Agent shall thereupon notify the
Sponsor of the Holder's election to convert such Debentures into [other
securities]. Holders at the close of business on a Distribution record date will
be entitled to receive the Distribution payable on such Securities on the
corresponding Distribution payment date notwithstanding the conversion of such
Securities following such record date but prior to such distribution payment
date. Except as provided above, neither the Trust nor the Sponsor will make, or
be required to make, any payment, allowance or adjustment upon any conversion on
account of any accumulated and unpaid Distributions accrued on the Securities
surrendered for conversion, or on account of any accumulated and unpaid
dividends on the [other securities] issued upon such conversion. Securities
shall be deemed to have been converted immediately prior to the close of
business on the day on which a Notice of Conversion relating to such Securities
is received by the Trust in accordance with the foregoing provision (the
"Conversion Date"). The Person or Persons entitled to receive [other securities]
issuable upon conversion of the Debentures shall be treated for all purposes as
the record holder or holders of such [other securities] at such time. As
promptly as practicable on or after the Conversion Date, the Sponsor shall issue
and deliver at the office of the Conversion Agent a certificate or certificates
for the number of full [other securities] issuable upon such conversion,
together with the cash payment, if any, in lieu of any fraction of any share to
the Person or Persons entitled to receive the same, unless otherwise directed by
the Holder in the Notice of Conversion and the Conversion Agent shall distribute
such certificate or certificates to such Person or Persons.

         (c)      Each Holder of a Security by his acceptance thereof appoints
the Property Trustee as "Conversion Agent" for the purpose of effecting the
conversion or exchange of Securities in accordance with this Section. In
effecting the conversion or exchange and transactions described in this Section,
the Conversion Agent shall be acting as agent of the Holders directing it to
effect such conversion or exchange transactions. The Conversion Agent is hereby
authorized (i) to exchange Securities from time to time for Debentures held by
the Trust in connection with the conversion or exchange of such Securities in
accordance with this Section; and (ii) to convert all or a portion of the
Debentures into [other securities] and thereupon to deliver such [other
securities] in accordance with the provisions of this Section and to deliver to
the Trust a new Debenture or Debentures for any resulting unconverted principal
amount.

                                    ANNEX I-7
<PAGE>

         (d)      No fractional [other securities] will be issued as a result of
conversion or exchange, but in lieu thereof, such fractional interest will be
paid in cash by the Sponsor to the Conversion Agent, which in turn will make
such payment to the Holder or Holders so converted.

         (e)      The Sponsor shall at all times reserve and keep available out
of its authorized and unissued [other securities], solely for issuance upon the
conversion or exchange of the Debentures, free from any preemptive or other
similar rights, such number of [other securities] as shall from time to time be
issuable upon the conversion or exchange of all the Debentures then outstanding.
Notwithstanding the foregoing, the Sponsor shall be entitled to deliver upon
conversion or exchange of Debentures, [other securities] reacquired and held in
the treasury of the Sponsor (in lieu of the issuance of authorized and unissued
[other securities]), so long as any such treasury shares are free and clear of
all liens, charges, security interests or encumbrances. Any [other securities]
issued upon conversion or exchange of the Debentures shall be duly authorized,
validly issued and fully paid and nonassessable. The Trust shall deliver the
[other securities] received upon conversion or exchange of the Debentures to the
converting Holder free and clear of all liens, charges, security interests and
encumbrances, except for United States withholding taxes. Each of the Sponsor
and the Trust shall prepare and shall use its best efforts to obtain and keep in
force such governmental or regulatory permits or other authorizations as may be
required by law, and shall comply with all applicable requirements as to
registration or qualification of [other securities], in order to enable the
Sponsor to lawfully issue [other securities] to the Trust upon conversion or
exchange of the Debentures and the Trust to lawfully deliver [other securities]
to each Holder upon conversion or exchange of the Securities.

         (f)      The Sponsor will pay any and all taxes that may be payable in
respect of the issue or delivery of the [other securities] on conversion or
exchange of Debentures and the delivery of the [other securities] by the Trust
upon conversion or exchange of the Securities. The Sponsor shall not, however,
be required to pay any tax which may be payable in respect of any transfer
involved in the issue and delivery of the [other securities] in a name other
than that in which the Securities so converted were registered, and no such
issue or delivery shall be made unless and until the person requesting such
issue has paid to the Trust the amount of any such tax, or has established to
the satisfaction of the Trust that such tax has been paid.

         (g)      Nothing in the preceding paragraph (f) shall limit the
requirement of the Trust to withhold taxes pursuant to the terms of the
Securities, this Annex I to the Declaration or the Declaration or otherwise
require the Property Trustee or the Trust to pay any amounts on account of such
withholdings.]

6.       Voting Rights - Preferred Securities.

         (a)      Except as provided under Sections 6(b), 7(b) and 8 and as
otherwise required by law and the Declaration, the Holders of the Preferred
Securities will have no voting rights.

         (b)      Subject to the requirements set forth in this paragraph, the
Holders of a Majority in Liquidation Amount of the Preferred Securities, voting
separately as a class, may, and the Trustees shall not, without obtaining the
prior approval of the Holders of a Majority in Liquidation Amount of all
outstanding Preferred Securities, (i) direct the time, method and place of
conducting any

                                    ANNEX I-8
<PAGE>

proceeding for any remedy available to the Debenture Trustee, or executing any
trust or power conferred on such Debenture Trustee with respect to the
Debentures; (ii) waive any past default that is waivable under Section 5.07 of
the Indenture; (iii) exercise any right to rescind or annul a declaration of
acceleration of the maturity of the principal of the Debentures; or (iv) consent
to any amendment, modification or termination of the Indenture or the
Debentures, where such consent shall be required; provided, however, that where
a consent or other action under the Indenture with respect to the Debentures
would require the consent or act of holders of all outstanding Debentures, no
consent or act shall be given or taken except by the Holders of all outstanding
Preferred Securities. The Trustees shall not revoke any action previously
authorized or approved by a vote of the Holders of the Preferred Securities
except by subsequent vote of such Holders. Subject to Section 2.7 of the
Declaration, the Property Trustee shall notify each Holder of Preferred
Securities of any notice of default with respect to the Debentures. In addition
to obtaining the foregoing approvals of such Holders of the Preferred
Securities, prior to taking any of the foregoing actions, the Trustees shall
obtain an Opinion of Counsel experienced in such matters to the effect that the
Trust will not be classified as an association taxable as a corporation for
United States federal income tax purposes on account of such action.

         (c)      If an Event of Default under the Declaration has occurred and
is continuing and such event is attributable to the failure of the Debenture
Issuer to pay principal of or premium, if any, or interest on the Debentures on
any due date (including any Interest Payment Date or redemption date or the
Maturity Date), then a Holder of Preferred Securities may directly institute a
legal proceeding against the Debenture Issuer for enforcement of payment to such
Holder of the principal of or premium, if any, or interest on a Like Amount of
Debentures (a "Direct Action") on or after the respective due date specified in
the Debentures. In connection with such Direct Action, the rights of the Holders
of the Common Securities will be subrogated to the rights of such Holder of
Preferred Securities to the extent of any payment made by the Debenture Issuer
to such Holder of Preferred Securities in such Direct Action. Except as provided
in this paragraph, the Holders of Preferred Securities will not be able to
exercise directly any other remedy available to the holders of the Debentures.

         (d)      Any approval or direction of Holders of Preferred Securities
may be given at a separate meeting of Holders of Preferred Securities convened
for such purpose, at a meeting of all of the Holders of Preferred Securities or
pursuant to written consent. The Property Trustee will cause a notice of any
meeting at which Holders of Preferred Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Preferred Securities. Each such notice
will include a statement setting forth (i) the date of such meeting or the date
by which such action is to be taken; (ii) a description of any resolution
proposed for adoption at such meeting on which such Holders are entitled to vote
or of such matter upon which written consent is sought; and (iii) instructions
for the delivery of proxies or consents.

         (e)      No vote or consent of the Holders of the Preferred Securities
will be required for the Trust to redeem and cancel Preferred Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.

         (f)      Notwithstanding that Holders of Preferred Securities are
entitled to vote or consent under any of the circumstances described above, any
of the Preferred Securities that are owned by the

                                    ANNEX I-9
<PAGE>

Sponsor or any Affiliate of the Sponsor shall not be entitled to vote or consent
and shall, for purposes of such vote or consent, be treated as if they were not
outstanding.

7.       Voting Rights - Common Securities.

         (a)      Except as provided under Sections 7(b), 7(c) and 8 or as
otherwise required by law and the Declaration, the Holders of the Common
Securities will have no voting rights.

         (b)      Unless an Event of Default shall have occurred and be
continuing, any Trustee may be removed at any time by the Holder of the Common
Securities. If an Event of Default has occurred and is continuing, the Property
Trustee and the Delaware Trustee may be removed at such time by the Holders of a
Majority in Liquidation Amount of the outstanding Preferred Securities. In no
event will the Holders of the Preferred Securities have the right to vote to
appoint, remove or replace the Administrative Trustees, which voting rights are
vested exclusively in the Sponsor as the Holder of the Common Securities. No
resignation or removal of a Trustee and no appointment of a successor trustee
shall be effective until the acceptance of appointment by the successor trustee
in accordance with the provisions of the Declaration.

         (c)      Subject to Section 2.6 of the Declaration and only after the
Event of Default with respect to the Preferred Securities has been cured, waived
or otherwise eliminated and subject to the requirements of the second to last
sentence of this paragraph, the Holders of a Majority in Liquidation Amount of
the Common Securities, voting separately as a class, may, and the Trustees will
not, (i) direct the time, method and place of conducting any proceeding for any
remedy available to the Debenture Trustee, or executing any trust or power
conferred on such Debenture Trustee with respect to the Debentures; (ii) waive
any past default that is waivable under Section 5.07 of the Indenture; (iii)
exercise any right to rescind or annul a declaration of acceleration of the
maturity of the principal of the Debentures; or (iv) consent to any amendment,
modification or termination of the Indenture or the Debentures, where such
consent shall be required; provided, however, that where a consent or other
action under the Indenture with respect to the Debentures would require the
consent or act of holders of all outstanding Debentures no consent or act shall
be given or taken except by the Holders of all outstanding Common Securities.
The Trustees shall not revoke any action previously authorized or approved by a
vote of the Holders of the Common Securities except by subsequent vote of such
Holders. The Property Trustee shall notify each Holder of Common Securities of
any notice of default with respect to the Debentures. In addition to obtaining
the foregoing approvals of such Holders of the Common Securities, prior to
taking any of the foregoing actions, the Trustees shall obtain an Opinion of
Counsel experienced in such matters to the effect that the Trust will not be
classified as an association taxable as a corporation for United States federal
income tax purposes on account of such action.

         (d)      If an Event of Default under the Declaration has occurred and
is continuing and such event is attributable to the failure of the Debenture
Issuer to pay principal of or premium, if any, or interest on the Debentures on
the due date (including any Interest Payment Date or redemption date or the
Maturity Date), then a Holder of Common Securities may institute a Direct Action
for enforcement of payment to such Holder of the principal of or premium, if
any, or interest on a Like Amount of Debentures on or after the respective due
date specified in the Debentures. Except as

                                   ANNEX I-10
<PAGE>

provided in this paragraph, the Holders of Common Securities will not be able to
exercise directly any other remedy available to the holders of the Debentures.

         (e)      Any approval or direction of Holders of Common Securities may
be given at a separate meeting of Holders of Common Securities convened for such
purpose, at a meeting of all of the Holders of Common Securities in the Trust or
pursuant to written consent. The Administrative Trustees will cause a notice of
any meeting at which Holders of Common Securities are entitled to vote, or of
any matter upon which action by written consent of such Holders is to be taken,
to be mailed to each Holder of record of Common Securities. Each such notice
will include a statement setting forth (i) the date of such meeting or the date
by which such action is to be taken; (ii) a description of any resolution
proposed for adoption at such meeting on which such Holders are entitled to vote
or of such matter upon which written consent is sought; and (iii) instructions
for the delivery of proxies or consents.

         (f)      No vote or consent of the Holders of the Common Securities
will be required for the Trust to redeem and cancel Common Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.

8.       Amendments to the Declaration.

         In addition to the circumstances and requirements set out in Section
12.1 of the Declaration, the Declaration may be amended by the Trustees and the
Sponsor with (i) the consent of Holders representing a Majority in Liquidation
Amount of all outstanding Securities; and (ii) receipt by the Trustees of an
Opinion of Counsel to the effect that such amendment or the exercise of any
power granted to the Trustees in accordance with such amendment will not affect
the Trust's status as a grantor trust for United States federal income tax
purposes or the Trust's exemption from status as an investment company under the
Investment Company Act; provided that, without the consent of each Holder, the
Declaration may not be amended to (i) change the amount or timing of any
Distribution on the Securities or otherwise adversely affect the amount of any
Distribution required to be made in respect of the Securities as of a specified
date; or (ii) restrict the right of a Holder to institute suit for the
enforcement of any such payment on or after such date.

9.       Pro Rata.

         A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each Holder
according to the aggregate Liquidation Amount of the Securities held by the
relevant Holder in relation to the aggregate Liquidation Amount of all
Securities outstanding unless, in relation to any payment, an Event of Default
under the Declaration has occurred and is continuing, in which case any funds
available to make such payment shall be paid first to each Holder of the
Preferred Securities pro rata according to the aggregate Liquidation Amount of
Preferred Securities held by the relevant Holder relative to the aggregate
Liquidation Amount of all Preferred Securities outstanding, and only after
satisfaction of all amounts owed to the Holders of the Preferred Securities, to
each Holder of Common Securities pro rata according to the aggregate Liquidation
Amount of Common Securities held by the relevant Holder relative to the
aggregate Liquidation Amount of all Common Securities outstanding.

                                   ANNEX I-11
<PAGE>

10.      Ranking.

         The Preferred Securities rank pari passu with the Common Securities and
payment thereon shall be made Pro Rata with the Common Securities, except that,
if an Event of Default under the Declaration occurs and is continuing, no
payments in respect of Distributions on, or payments upon liquidation,
redemption or otherwise with respect to, the Common Securities shall be made
until the Holders of the Preferred Securities shall be paid in full the
Distributions, Redemption Price, Liquidation Distribution and other payments to
which they are entitled at such time.

11.      Acceptance of Preferred Securities Guarantee and Indenture.

         Each Holder of Preferred Securities by the acceptance thereof, agrees
to the provisions of the Preferred Securities Guarantee, including the
subordination provisions therein and to the provisions of the Indenture.

12.      No Preemptive Rights.

         The Holders of the Securities shall have no preemptive or similar
rights to subscribe for any additional securities.

13.      Miscellaneous.

         These terms in this Annex I constitute a part of the Declaration. The
Sponsor will provide a copy of the Declaration, the Preferred Securities
Guarantee and the Indenture (including any supplemental indenture) to a Holder
without charge on written request to the Sponsor at its principal place of
business.

                                   ANNEX I-12
<PAGE>

                                   EXHIBIT A-1

                     FORM OF PREFERRED SECURITY CERTIFICATE
                           [FORM OF FACE OF SECURITY]

         [IF THIS PREFERRED SECURITY IS A GLOBAL PREFERRED SECURITY, INSERT:
THIS PREFERRED SECURITY IS A GLOBAL PREFERRED SECURITY WITHIN THE MEANING OF THE
DECLARATION HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY (THE "CLEARING AGENCY") OR A NOMINEE OF THE CLEARING
AGENCY. THIS PREFERRED SECURITY IS EXCHANGEABLE FOR PREFERRED SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE CLEARING AGENCY OR ITS NOMINEE
ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE DECLARATION AND NO TRANSFER
OF THIS PREFERRED SECURITY (OTHER THAN A TRANSFER OF THIS PREFERRED SECURITY AS
A WHOLE BY THE CLEARING AGENCY TO A NOMINEE OF THE CLEARING AGENCY OR BY A
NOMINEE OF THE CLEARING AGENCY TO THE CLEARING AGENCY OR ANOTHER NOMINEE OF THE
CLEARING AGENCY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.

         UNLESS THIS PREFERRED SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW
YORK) TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY PREFERRED SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE &
CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY AND ANY PAYMENT HEREON IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

         Certificate No.: _________

         Number of Preferred Securities: _____________

         CUSIP No.: ___________

                   Certificate Evidencing Preferred Securities

                                       of

                            Dynegy Capital Trust III

                           [___% Preferred Securities]

             (Liquidation Amount $__________ per Preferred Security)

         Dynegy Capital Trust III, a statutory business trust created under the
laws of the State of Delaware (the "Trust"), hereby certifies that
______________ (the "Holder") is the registered owner

                                  EXHIBIT A-1-1
<PAGE>

of [$_________ in aggregate Liquidation Amount of Preferred Securities of the
Trust]1 [the aggregate Liquidation Amount of Preferred Securities of the Trust
specified in Schedule A hereto]2 representing undivided beneficial interests in
the assets of the Trust designated the [___% Preferred Securities] (liquidation
amount $_________ per Preferred Security) (the "Preferred Securities"). Subject
to the Declaration (as defined below), the Preferred Securities are transferable
on the books and records of the Trust, in person or by a duly authorized
attorney, upon surrender of this certificate duly endorsed and in proper form
for transfer. The designation, rights, privileges, restrictions, preferences and
other terms and provisions of the Preferred Securities represented hereby are
issued and shall in all respects be subject to the provisions of the Amended and
Restated Declaration of Trust of the Trust dated as of ______, __, as the same
may be amended from time to time (the "Declaration"), including the designation
of the terms of the Preferred Securities as set forth in Annex I to the
Declaration. Capitalized terms used but not defined herein shall have the
meaning given them in the Declaration. The Sponsor will provide a copy of the
Declaration, the Preferred Securities Guarantee, the Common Securities Guarantee
(as may be appropriate), and the Indenture (including any supplemental
indenture) to a Holder without charge upon written request to the Trust at its
principal place of business.

         Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Preferred Securities Guarantee to the extent provided therein.

         By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Preferred Securities
as evidence of indirect beneficial ownership in the Debentures.

____________________
(1) Insert in Definitive Preferred Securities only.
(2) Insert in Global Preferred Securities only.

                                  EXHIBIT A-1-2
<PAGE>

         IN WITNESS WHEREOF, the Trust has duly executed this certificate.

         Dated: ______________

                                       DYNEGY CAPITAL TRUST III

                                       By:______________________________________
                                       Name:____________________________________
                                            Administrative Trustee

                                  EXHIBIT A-1-3
<PAGE>

                PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION

         This is one of the Preferred Securities referred to in the within-
mentioned Declaration.

                                   Bank One Trust Company, National Association,
                                   as Property Trustee

                                   By:
                                      Authorized Signatory
<PAGE>

                          [FORM OF REVERSE OF SECURITY]

         Distributions payable on each Preferred Security will be fixed at a
rate per annum of ___% (the "Coupon Rate") of the Liquidation Amount of
$_________ per Preferred Security, such rate being the rate of interest payable
on the Debentures to be held by the Property Trustee. Distributions in arrears
for more than one [semi-annual] period will bear interest thereon compounded
[semi-annually] at the Coupon Rate (to the extent permitted by applicable law).
The term "Distributions," as used herein, includes such cash distributions and
any such interest payable unless otherwise stated. A Distribution is payable
only to the extent that payments are made in respect of the Debentures held by
the Property Trustee and to the extent the Property Trustee has funds on hand
legally available therefor.

         Distributions on the Preferred Securities will be cumulative, will
accumulate from and including the most recent date to which Distributions have
been paid or, if no Distributions have been paid, from and including [ ], [ ] to
but excluding the related Distribution Date or any date fixed for redemption,
and will be payable [semi-annually] in arrears on [ ] and [ ] of each year,
commencing on [ ], [ ], except as otherwise described below and in the
Declaration. Distributions will be computed on the basis of a 360-day year
consisting of twelve 30-day months and, for any period of less than a full
calendar month, the number of days elapsed in such month. [As long as no Event
of Default (as defined in the Indenture) has occurred and is continuing, the
Debenture Issuer has the right under the Indenture to defer the payment of
interest on the Debentures at any time and from time to time for a period not
exceeding [____] consecutive calendar [semi-annual] periods, including the first
such [semi-annual period] during such extension period (each, an "Extension
Period"), provided that no Extension Period shall extend beyond the Maturity
Date of the Debentures. Distributions will be deferred during any Extension
Period. Notwithstanding such deferral, [semi-annual] Distributions will continue
to accumulate with interest thereon (to the extent permitted by applicable law,
but not at a rate exceeding the rate of interest then accruing on the
Debentures) at the Coupon Rate compounded [semi-annually] during any Extension
Period. Prior to the termination of any Extension Period, the Debenture Issuer
may further defer payments of interest by further extending such Extension
Period; provided that such Extension Period, together with all previous and
further extensions, if any, within such Extension Period, may not exceed [____]
consecutive [semi-annual] periods, including the first semi-annual period during
such Extension Period, or extend beyond the Maturity Date of the Debentures.
[Payments of Distributions that have accumulated but not been paid during any
Extension Period will be payable to Holders as they appear on the books and
records of the Trust on the record date for the first scheduled Distribution
payment date following the expiration of such Extension Period and prior to the
commencement of any new Extension Period. Upon the expiration of any Extension
Period and the payment of all amounts then due, the Debenture Issuer may
commence a new Extension Period, subject to the above requirements.]

         [Subject to the conditions set forth in the Declaration and the
Indenture, the Property Trustee shall, at the direction of the Sponsor, at any
time dissolve the Trust and, upon satisfaction of the liabilities to creditors
of the Trust as provided by law, cause the Debentures to be distributed to the
holders of the Securities in liquidation of the Trust [or, simultaneously with
any redemption of the Debentures, cause a Like Amount of the Securities to be
redeemed by the Trust.]
<PAGE>

         [The Preferred Securities shall be redeemable as provided in the
Declaration.]

         [The Preferred Securities shall be convertible or exchangeable into
[___________] as provided in the Declaration.]

         ASSIGNMENT FOR VALUE RECEIVED, the undersigned assigns and transfers
this Preferred Security Certificate to: ________________________________________
________________________________________________________________________________
________________________________________________________________________________

(Insert assignee's social security or tax identification number)________________
________________________________________________________________________________
________________________________________________________________________________
_________________________

(Insert address and zip code of assignee) and irrevocably appoints _____________
________________________________________________________________________________
________________________________________________________________________________
agent to transfer this Preferred Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.

Date: _______________________

Signature: __________________

(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)

Signature Guarantee***

_________________________
*** Signature must be guaranteed by an "eligible guarantor institution" that is
a bank, stockbroker, savings and loan association or credit union meeting the
requirements of the Registrar, which requirements include membership or
participation in the Securities Transfer Agents Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities and Exchange Act of 1934, as amended.
<PAGE>

                                   SCHEDULE A*

         The initial number of Preferred Securities evidenced by the Certificate
to which this Schedule is attached is _______ (having an aggregate Liquidation
Amount of $______). The notations in the following table evidence decreases and
increases in the number of Preferred Securities evidenced by such Certificate.

         Number of Preferred Decrease in Number Increase in Number Securities
Remaining of Preferred of Preferred After Such Decrease Notation Securities or
Increase by Registrar __________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
_______________________________________

_________________________
* Append to Global Preferred Securities only.

                                   SCHEDULE A
<PAGE>

                                   EXHIBIT A-2

                       FORM OF COMMON SECURITY CERTIFICATE

         THIS COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS OR ANY
OTHER APPLICABLE SECURITIES LAW. NEITHER THIS COMMON SECURITY NOR ANY INTEREST
OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.

         THE COMMON SECURITIES ARE NOT TRANSFERABLE EXCEPT AS DESCRIBED IN THE
DECLARATION (AS DEFINED BELOW).

         Certificate No.: _________

         Number of Common Securities: _____________

         [CUSIP No.: ___________]

                    Certificate Evidencing Common Securities

                                       of

                            Dynegy Capital Trust III

                            [____% Common Securities]

              (liquidation amount $__________ per Common Security)

         Dynegy Capital Trust III, a statutory business trust created under the
laws of the State of Delaware (the "Trust"), hereby certifies that
______________________ (the "Holder") is the registered owner of [$_________ in
aggregate Liquidation Amount of Common Securities of the Trust] [the aggregate
Liquidation Amount of Common Securities of the Trust specified in Schedule A
hereto]3 representing undivided beneficial interests in the assets of the Trust
designated the Series ____% Common Securities (liquidation amount $_______ per
Common Security) (the "Common Securities"). Subject to the limitations in the
Declaration (as defined below), the Common Securities are transferable on the
books and records of the Trust, in person or by a duly authorized attorney, upon
surrender of this certificate duly endorsed and in proper form for transfer. The
designation, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities represented hereby are issued and shall in
all respects be subject to the provisions of the Amended and Restated
Declaration of Trust of the Trust dated as of _____, ___, as the same may be
amended from time to time (the "Declaration"), including the designation of the
terms of the Common Securities as set forth in Annex I to the Declaration.
Capitalized terms used but not defined herein

_________________________
(3) Insert in Global Preferred Securities only.

                                  EXHIBIT A-2-1
<PAGE>

shall have the meaning given them in the Declaration. The Sponsor will provide a
copy of the Declaration, the Common Securities Guarantee, the Preferred
Securities Guarantee (as may be appropriate) and the Indenture (including any
supplemental indenture) to a Holder without charge upon written request to the
Trust at its principal place of business.

         Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Common Securities Guarantee to the extent provided therein.

         By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Common Securities as
evidence of indirect beneficial ownership in the Debentures.

         IN WITNESS WHEREOF, the Trust has executed this certificate this ___
day of __________, ____.

                                       Dynegy Capital Trust III

                                       By:______________________________________
                                       Name:____________________________________
                                            Administrative Trustee

                                  EXHIBIT A-2-2
<PAGE>

                          [FORM OF REVERSE OF SECURITY]

         Distributions payable on each Common Security will be fixed at a rate
per annum of [ ]% (the "Coupon Rate") of the Liquidation Amount of $______ per
Common Security, such rate being the rate of interest payable on the Debentures
to be held by the Property Trustee. Distributions in arrears for more than one
[semi-annual] period will bear interest thereon compounded semiannually at the
Coupon Rate (to the extent permitted by applicable law). The term
"Distributions," as used herein, includes such cash distributions and any such
interest payable unless otherwise stated. A Distribution is payable only to the
extent that payments are made in respect of the Debentures held by the Property
Trustee and to the extent the Property Trustee has funds available therefor.

         Distributions on the Common Securities will be cumulative, will
accumulate from and including the most recent date to which Distributions have
been paid or, if no Distributions have been paid, from and including [_____],
[___] to but excluding the related Distribution Date or any date fixed for
redemption, and will be payable [semi-annually] in arrears on [________] and
[_____] of each year, commencing on [________], [___], except as otherwise
described below and in the Declaration. Distributions will be computed on the
basis of a 360-day year consisting of twelve 30 day months and, for any period
of less than a full calendar month, the number of days elapsed in such month.
[As long as no Event of Default (as defined in the Indenture) has occurred and
is continuing, the Debenture Issuer has the right under the Indenture to defer
the payment of interest on the Debenture at any time and from time for a period
not exceeding [___] consecutive calendar [semi-annual] periods, including the
first such semi-annual period during such extension period (each an "Extension
Period"), provided, that no Extension Period shall extend beyond the Maturity
Date of the Debentures. Distributions will be deferred during any Extension
Period. Notwithstanding such deferral, Distributions will continue to accumulate
with interest thereon (to the extent permitted by applicable law, but not at a
rate exceeding the rate of interest then accruing on the Debentures) at the
Coupon Rate compounded [semi-annually] during any Extension Period. Prior to the
termination of any Extension Period, the Debenture Issuer may further defer
payments of interest by further extending such Extension Period; provided, that
such Extension Period, together with all previous and further extensions, if
any, within such Extension Period, may not exceed [___] consecutive
[semi-annual] periods, including the first semi-annual period during such
Extension Period, or extend beyond the Maturity Date of the Debentures. Payments
of Distributions that have accumulated but not been paid during any Extension
Period will be payable to Holders as they appear on the books and records of the
Trust on the record date for the first Distribution Date following the
expiration of such Extension Period. Upon the expiration of any Extension Period
and the payment of all amounts then due, the Debenture Issuer may commence a new
Extension Period, subject to the above requirements.]

         [Subject to the conditions set forth in the Declaration and the
Indenture, the Property Trustee shall, at the direction of the Sponsor, at any
time dissolve the Trust and, upon satisfaction of the liabilities to creditors
of the Trust as provided by law, cause the Debentures to be distributed to the
holders of the Securities in liquidation of the Trust [or, simultaneously with
any redemption of the Debentures, cause a Like Amount of the Securities to be
redeemed by the Trust.]

         [The Common Securities shall be redeemable as provided in the
Declaration.]

         [The Common Securities shall be convertible or exchangeable into
[_______] as provided in the Declaration.]
<PAGE>

                                  EXHIBIT A-2-2<PAGE>

                                                                    EXHIBIT 4.11
--------------------------------------------------------------------------------

                                  DYNEGY INC.

                                      and

                  BANK ONE TRUST COMPANY, NATIONAL ASSOCIATION

                                   as Trustee

                     FORM OF JUNIOR SUBORDINATED INDENTURE

          Relating to [____% Junior Subordinated Debentures due _____]

                     Dated as of _______________ ___, _____

--------------------------------------------------------------------------------
<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<S>                                                                              <C>
                                    ARTICLE I
             DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

SECTION 1.01      Definitions..................................................   1
SECTION 1.02      Form of Documents Delivered to Trustee.......................   7
SECTION 1.03      Successors...................................................   8
SECTION 1.04      Indenture and Securities Solely Corporate Obligations........   8
SECTION 1.05      Addresses for Notices, etc...................................   9
SECTION 1.06      Governing Law................................................   9
SECTION 1.07      Evidence of Compliance with Conditions Precedent.............   9
SECTION 1.08      Business Days................................................   9
SECTION 1.09      Trust Indenture Act to Control...............................  10
SECTION 1.10      Table of Contents, Headings, etc.............................  10
SECTION 1.11      Execution in Counterparts....................................  10
SECTION 1.12      Separability.................................................  10

                                   ARTICLE II
                                   SECURITIES

SECTION 2.01      Forms Generally..............................................  10
SECTION 2.02      Execution and Authentication.................................  11
SECTION 2.03      Form and Payment.............................................  11
SECTION 2.04      Global Security..............................................  11
SECTION 2.05      Interest.....................................................  13
SECTION 2.06      Transfer and Exchange........................................  14
SECTION 2.07      Replacement Securities.......................................  15
SECTION 2.08      Temporary Securities.........................................  15
SECTION 2.09      Cancellation.................................................  16
SECTION 2.10      Defaulted Interest...........................................  16
SECTION 2.11      CUSIP Numbers................................................  17
SECTION 2.12      Right of Set Off.............................................  17
SECTION 2.13      Extension of Interest Payment Period.........................  17

                                   ARTICLE III
                       PARTICULAR COVENANTS OF THE COMPANY

SECTION 3.01      Payment of Principal, Premium and Interest...................  18
SECTION 3.02      Offices for Notices and Payments, etc........................  18
SECTION 3.03      Appointments to Fill Vacancies in Trustee's Office...........  19
SECTION 3.04      Provision as to Paying Agent [and Conversion Agent]..........  19
SECTION 3.05      Certificate to Trustee.......................................  20
SECTION 3.06      Compliance with Consolidation Provisions.....................  20
SECTION 3.07      Limitation on Certain Payments...............................  20
SECTION 3.08      Covenants as to Dynegy Capital Trust III.....................  21
</TABLE>

                                       -i-
<PAGE>

<TABLE>
<S>                                                                              <C>
SECTION 3.09      Payment of Trust's Costs and Expenses........................  21

                                   ARTICLE IV
                    SECURITYHOLDERS' LISTS AND REPORTS BY THE

SECTION 4.01      Securityholders' Lists.......................................  22
SECTION 4.02      Preservation and Disclosure of Lists.........................  22
SECTION 4.03      Reports by Company...........................................  22
SECTION 4.04      Reports by the Trustee.......................................  23

                                    ARTICLE V
                   REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
                               ON EVENT OF DEFAULT

SECTION 5.01      Events of Default............................................  23
SECTION 5.02      Payment of Securities on Default; Suit Therefor..............  25
SECTION 5.03      Application of Moneys Collected by Trustee...................  27
SECTION 5.04      Proceedings by Securityholders...............................  27
SECTION 5.05      Proceedings by Trustee.......................................  28
SECTION 5.06      Remedies Cumulative and Continuing...........................  28
SECTION 5.07      Direction of Proceedings and Waiver of Defaults
                  by Majority of Securityholders...............................  29
SECTION 5.08      Notice of Defaults...........................................  29
SECTION 5.09      Undertaking to Pay Costs.....................................  30
SECTION 5.10      Waiver of Stay or Extension Laws.............................  30

                                   ARTICLE VI
                             CONCERNING THE TRUSTEE

SECTION 6.01      Duties and Responsibilities of Trustee.......................  30
SECTION 6.02      Reliance on Documents, Opinions, etc.........................  31
SECTION 6.03      No Responsibility for Recitals, etc..........................  33
SECTION 6.04      Trustee, Authenticating Agent, Paying Agents, Transfer
                  Agents or Registrar May Own Securities.......................  33
SECTION 6.05      Moneys to be Held in Trust...................................  33
SECTION 6.06      Compensation and Expenses of Trustee.........................  33
SECTION 6.07      Officers' Certificate as Evidence............................  34
SECTION 6.08      Conflicting Interest of Trustee..............................  34
SECTION 6.09      Eligibility of Trustee.......................................  34
SECTION 6.10      Resignation or Removal of Trustee............................  35
SECTION 6.11      Acceptance by Successor Trustee..............................  36
SECTION 6.12      Succession by Merger, etc....................................  36
SECTION 6.13      Limitation on Rights of Trustee as a Creditor................  37
SECTION 6.14      Authenticating Agents........................................  37

                                   ARTICLE VII
                         CONCERNING THE SECURITYHOLDERS

SECTION 7.01      Action by Securityholders....................................  38
SECTION 7.02      Proof of Execution by Securityholders........................  39
</TABLE>

                                      -ii-
<PAGE>

<TABLE>
<S>                                                                              <C>
SECTION 7.03      Who Are Deemed Absolute Owners...............................  39
SECTION 7.04      Securities Owned by Company Deemed Not Outstanding...........  39
SECTION 7.05      Revocation of Consents; Future Holders Bound.................  39

                                  ARTICLE VIII
                CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE

SECTION 8.01      Company May Consolidate, etc., on Certain Terms..............  40
SECTION 8.02      Successor Corporation to be Substituted for Company..........  40
SECTION 8.03      Opinion of Counsel to be Given Trustee.......................  41

                                   ARTICLE IX
                             SUPPLEMENTAL INDENTURES

SECTION 9.01      Without Consent of Securityholders...........................  41
SECTION 9.02      With Consent of Securityholders..............................  42
SECTION 9.03      Compliance with Trust Indenture Act; Effect of
                  Supplemental Indentures......................................  43
SECTION 9.04      Notation on Securities.......................................  44
SECTION 9.05      Evidence of Compliance of Supplemental Indenture to be
                  Furnished Trustee............................................  44

                                    ARTICLE X
                                   REDEMPTION

SECTION 10.01     Special Event Redemption.....................................  44
SECTION 10.02     Optional Redemption by Company...............................  44
SECTION 10.03     No Sinking Fund..............................................  45
SECTION 10.04     Notice of Redemption; Selection of Securities................  45
SECTION 10.05     Payment of Securities Called for Redemption..................  46

                                   ARTICLE XI
                     SATISFACTION AND DISCHARGE OF INDENTURE

SECTION 11.01     Discharge of Indenture.......................................  46
SECTION 11.02     Deposited Moneys to be Held in Trust by Trustee..............  47
SECTION 11.03     Paying Agent to Repay Moneys Held............................  47
SECTION 11.04     Return of Unclaimed Moneys...................................  47

                                   ARTICLE XII
                                  SUBORDINATION

SECTION 12.01     Agreement to Subordinate.....................................  48
SECTION 12.02     Default on Senior Indebtedness...............................  48
SECTION 12.03     Liquidation; Dissolution; Bankruptcy.........................  48
SECTION 12.04     Subrogation..................................................  50
SECTION 12.05     Trustee to Effectuate Subordination..........................  50
SECTION 12.06     Notice by the Company........................................  50
SECTION 12.07     Rights of the Trustee; Holders of Senior Indebtedness........  51
SECTION 12.08     Subordination May Not Be Impaired............................  52
SECTION 12.09     Article Applicable to Paying Agents..........................  52
SECTION 12.10     Trust Moneys Not Subordinated................................  53
</TABLE>

                                      -iii-
<PAGE>

<TABLE>
<S>                                                                              <C>
                                  ARTICLE XIII
                            [CONVERSION OF SECURITIES

SECTION 13.01     Conversion Rights............................................  53
SECTION 13.02     Conversion Procedures........................................  53
SECTION 13.03     Conversion Price Adjustments.................................  55
SECTION 13.04     Reclassification, Consolidation, Merger or Sale of Assets....  55
SECTION 13.05     Notice of Adjustments of Conversion Price....................  56
SECTION 13.06     Prior Notice of Certain Events...............................  56
SECTION 13.07     Definitions Applicable to Article XIII.......................  57
SECTION 13.08     Dividend or Interest Reinvestment Plans......................  58
SECTION 13.09     Certain Additional Rights....................................  58
SECTION 13.10     Restrictions on Common Stock Issuable Upon Conversion........  58
SECTION 13.11     Trustee Not Responsible for Determining
                  Conversion Price or Adjustments..............................  59
</TABLE>

                                      -iv-
<PAGE>

          THIS JUNIOR SUBORDINATED INDENTURE, dated as of ______________, ____
between Dynegy Inc., an Illinois corporation (the "Company"), and Bank One Trust
Company, National Association, a national banking association, as trustee (the
"Trustee").

                              W I T N E S S E T H :

          In consideration of the premises, and the purchase of the Securities
by the holders thereof, the Company covenants and agrees with the Trustee for
the equal and proportionate benefit of the respective holders from time to time
of the Securities, as follows:

                                    ARTICLE I
             DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

SECTION 1.01  Definitions.

          The terms defined in this Section 1.01 (except as herein otherwise
expressly provided or unless the context otherwise requires) for all purposes of
this Indenture shall have the respective meanings specified in this Section
1.01. All other terms used in this Indenture that are defined in the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), or that are by
reference therein defined in the Securities Act, shall (except as herein
otherwise expressly provided or unless the context otherwise requires) have the
meanings assigned to such terms in said Trust Indenture Act and in said
Securities Act as in force at the date of this Indenture as originally executed.
The following terms have the meanings given to them in the Declaration: (i)
Clearing Agency; (ii) Delaware Trustee; (iii) Property Trustee; (iv)
Administrative Trustees; (v) Direct Action; and (vi) Distributions. All
accounting terms used herein and not expressly defined shall have the meanings
assigned to such terms in accordance with generally accepted accounting
principles and the term "generally accepted accounting principles" means such
accounting principles as are generally accepted at the time of any computation.
The words "herein," "hereof" and "hereunder" and other words of similar import
refer to this Indenture as a whole and not to any particular Article, Section or
other subdivision. Headings are used for convenience of reference only and do
not affect interpretation. The singular includes the plural and vice versa.

          [See Section 13.07 for certain defined terms relating to the
provisions of Article XIII.]

          "Additional Sums" shall have the meaning set forth in Section 2.05(c).

          "Affiliate" shall have the meaning given to that term in Rule 405
under the Securities Act or any successor rule thereunder.

          "Authenticating Agent" shall mean any agent or agents of the Trustee
which at the time shall be appointed and acting pursuant to Section 6.14.

          "Bankruptcy Law" shall mean Title 11, U.S. Code, or any similar
federal or state law for the relief of debtors.

          "Board of Directors" shall mean either the Board of Directors of the
Company or any duly authorized committee of that board.
<PAGE>

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

          "Business Day" shall mean, with respect to any series of Securities,
any day other than a Saturday or a Sunday or a day on which banking institutions
in Houston, Texas or Chicago, Illinois are authorized or required by law or
executive order to close.

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

          "Common Securities" shall mean the common securities of the Trust
representing undivided beneficial interests in the assets of the Trust which
rank pari passu with Preferred Securities issued by the Trust; provided,
however, that if an Event of Default has occurred and is continuing, no payments
in respect of Distributions on, or payments upon liquidation, redemption or
otherwise with respect to, the Common Securities shall be made until the holders
of the Preferred Securities shall be paid in full the Distributions and the
liquidation, redemption and other payments to which they are entitled.

          "Common Securities Guarantee" shall mean any guarantee that the
Company may enter into with any Person or Persons that operates directly or
indirectly for the benefit of holders of Common Securities of the Trust.

          "Common Stock" shall mean the Common Stock, no par value, of the
Company or any other class of stock resulting from changes or reclassifications
of such Common Stock consisting solely of changes in par value, or from par
value to no par value, or from no par value to par value.

          "Company" shall mean Dynegy Inc., an Illinois corporation, and,
subject to the provisions of Article VIII, shall include its successors and
assigns.

          "Company Request" or "Company Order" shall mean a written request or
order signed in the name of the Company by the Chairman of the Board, the Chief
Executive Officer, the President, a Vice Chairman of the Board or a Vice
President, and by its Chief Financial Officer, its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the
Trustee.

          "Compounded Interest" shall have the meaning set forth in Section
2.13(a).

          "Custodian" shall mean any receiver, trustee, assignee, liquidator, or
similar official under any Bankruptcy Law.

          "Declaration" means the Amended and Restated Declaration of Trust of
Dynegy Capital Trust III, dated as of _________, as amended from time to time.

          "Default" means any event, act or condition that with notice or lapse
of time, or both, would constitute an Event of Default.

                                       -2-
<PAGE>

          "Defaulted Interest" shall have the same meaning set forth in Section
2.10.

          "Deferred Interest" shall have the meaning set forth in Section
2.13(a).

          "Definitive Securities" shall mean those securities issued in fully
registered certificated form not otherwise in global form.

          "Depositary" shall mean, with respect to Securities issuable in whole
or in part in the form of one or more Global Securities, The Depository Trust
Company, New York, New York, another clearing agency, or any successor
registered as a clearing agency under the Exchange Act or other applicable
statute or regulation, which, in each case, shall be designated by the Company
pursuant to Section 2.04(d).

          "Dissolution Event" means the liquidation of the Trust pursuant to the
Declaration, and the distribution of the Securities held by the Property Trustee
to the holders of the Trust Securities issued by the Trust pro rata in
accordance with the Declaration.

          "Dynegy Capital Trust" or the "Trust" shall mean Dynegy Capital Trust
III, a Delaware business trust created for the purpose of issuing its undivided
beneficial interests in connection with the issuance of Securities under this
Indenture.

          "Event of Default" shall mean any event specified in Section 5.01,
continued for the period of time, if any, and after the giving of the notice, if
any, therein designated.

          "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.

          "Extended Interest Payment Period" shall have the meaning set forth in
Section 2.13(a).

          "Global Security" means, with respect to the Securities, a Security
executed by the Company and delivered by the Trustee to the Depositary or
pursuant to the Depositary's instruction, all in accordance with the Indenture,
which shall be registered in the name of the Depositary or its nominee.

          "Indebtedness" shall mean (i) every obligation of the Company for
money borrowed; (ii) every obligation of the Company evidenced by bonds,
debentures, notes or other similar instruments, including obligations incurred
in connection with the acquisition of property, assets or businesses; (iii)
every reimbursement obligation of the Company with respect to letters of credit,
bankers' acceptances or similar facilities issued for the account of the
Company; (iv) every obligation of the Company issued or assumed as the deferred
purchase price of property or services (but excluding trade accounts payable or
accrued liabilities arising in the ordinary course of business); (v) every
capital lease obligation of the Company; (vi) all indebtedness of the Company
whether incurred on or prior to the date of the Indenture or thereafter
incurred, for claims in respect of derivative products, including interest rate,
foreign exchange rate and commodity forward contracts, options and swaps and
similar arrangements; and (vii) every obligation of the type referred to in
clauses (i) through (vi) of another Person and all dividends of another Person
the payment of which, in either case, the Company has guaranteed or is
responsible or liable, directly or indirectly, as obligor or otherwise.

                                       -3-
<PAGE>

          "Indebtedness Ranking on a Parity with the Securities" shall mean (i)
Indebtedness, whether outstanding on the date of execution of this Indenture or
hereafter created, assumed or incurred, to the extent such indebtedness
specifically by its terms ranks equally with and not prior to the Securities in
the right of payment upon the happening of any dissolution or winding up or
liquidation or reorganization of the Company, and (ii) all other debt
securities, and guarantees in respect of those debt securities, issued to any
trust other than the Trust, or a trustee of such trust, partnership or other
entity affiliated with the Company that is a financing vehicle of the Company (a
"financing entity") in connection with the issuance by such financing entity of
equity securities that are similar to the Preferred Securities or other
securities guaranteed by the Company. The securing of any Indebtedness,
otherwise constituting Indebtedness Ranking on a Parity with the Securities,
shall not be deemed to prevent such Indebtedness from constituting Indebtedness
Ranking on a Parity with the Securities.

          "Indebtedness Ranking Junior to the Securities" shall mean any
Indebtedness, whether outstanding on the date of execution of this Indenture or
hereafter created, assumed or incurred, to the extent such indebtedness
specifically by its terms ranks junior to and not equally with or prior to the
Securities (and any other Indebtedness Ranking on a Parity with the Securities)
in right of payment upon the happening of any dissolution or winding up or
liquidation or reorganization of the Company. The securing of any Indebtedness,
otherwise constituting Indebtedness Ranking Junior to the Securities, shall not
be deemed to prevent such Indebtedness from constituting Indebtedness Ranking
Junior to the Securities.

          "Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this Indenture and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively.

          "Interest Payment Date" shall have the meaning set forth in Section
2.05(a).

          ["Investment Company Event" means the receipt by the Trust and the
Company of an opinion of counsel experienced in such matters to the effect that,
as a result of the occurrence of a change in law or regulation or a written
change (including any announced prospective change) in interpretation or
application of law or regulation by any legislative body, court, governmental
agency or regulatory authority, which amendment or change is effective or which
pronouncement or decision is announced on or after _____________, ____, there is
more than an insubstantial risk that the Trust is or will be considered an
"investment company" that is required to be registered under the Investment
Company Act of 1940, as amended (the "Investment Company Act"), which change or
prospective change becomes effective or would become effective, as the case may
be, on or after the date of the original issuance of the Preferred Securities.]

          "Maturity Date" shall mean __________, ____.

          "Mortgage" shall mean and include any mortgage, pledge, lien, security
interest, conditional sale or other title retention agreement or other similar
encumbrance.

                                       -4-
<PAGE>

          "Non Book-Entry Preferred Securities" shall have the meaning set forth
in Section 2.04(a)(ii).

          "Officers" shall mean any of the Chairman, a Vice Chairman, the Chief
Executive Officer, the President, a Vice President, the Comptroller, Treasurer,
an Assistant Treasurer, the Secretary or an Assistant Secretary of the Company.

          "Officers' Certificate" shall mean a certificate signed on behalf of
the Company, by the Chairman of the Board, Chief Executive Officer, a Vice
Chairman of the Board, the President or a Vice President, and by the Treasurer,
an Assistant Treasurer, the Secretary or an Assistant Secretary, of the Company,
and delivered to the Trustee. Any Officers' Certificate delivered with respect
to compliance with a condition or a covenant provided for in this Indenture
shall include the statements specified to be so included by Section 1.07 of this
Indenture.

          "Opinion of Counsel" shall mean a written opinion of counsel, who may
be an employee of the Company, and who shall be acceptable to the Trustee.

          The term "outstanding" when used with reference to Securities, shall,
subject to the provisions of Section 7.04, mean, as of any particular time, all
Securities authenticated and delivered by the Trustee or the Authenticating
Agent under this Indenture, except the following:

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

          (b) Securities, or portions thereof, for the payment or redemption of
which moneys in the necessary amount shall have been deposited in trust with the
Trustee or with any paying agent (other than the Company) or shall have been set
aside and segregated in trust by the Company (if the Company shall act as its
own paying agent); provided that, if such Securities, or portions thereof, are
to be redeemed prior to maturity thereof, notice of such redemption shall have
been given as in Article X provided or provision satisfactory to the Trustee
shall have been made for giving such notice; and

          (c) Securities which have been paid [or converted in accordance with
Article XIII] or in lieu of or in substitution for which other Securities shall
have been authenticated and delivered pursuant to the terms of Section 2.07
unless proof satisfactory to the Company and the Trustee is presented that any
such Securities are held by bona fide holders in due course.

          "Person" shall mean any individual, corporation, estate, partnership,
joint venture, association, joint-stock company, limited liability company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.

          "Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt and as that evidenced by
such particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 2.07 in lieu of a lost, destroyed or
stolen Security shall be deemed to evidence the same debt as the lost, destroyed
or stolen Security.

                                       -5-
<PAGE>

          "Preferred Securities" shall mean the [preferred securities]
representing undivided beneficial interests in the assets of the Trust which
rank pari passu with the Common Securities issued by the Trust; provided,
however, that if an Event of Default has occurred and is continuing, no payments
in respect of Distributions on, or payments upon liquidation, redemption or
otherwise with respect to, the Common Securities shall be made until the holders
of the Preferred Securities shall be paid in full the Distributions and the
liquidation, redemption and other payments to which they are entitled.

          "Preferred Securities Guarantee" shall mean any guarantee that the
Company may enter into with Bank One Trust Company, National Association, or
other Persons that operates directly or indirectly for the benefit of holders of
Preferred Securities of the Trust.

          "Principal Office of the Trustee", or other similar term, shall mean
the office of the Trustee, at which at any particular time its corporate trust
business shall be administered.

          "Property Trustee" shall have the same meaning as set forth in the
Declaration.

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

          "Responsible Officer" shall mean any officer of the Trustee with
direct responsibility for the administration of the Indenture and also means,
with respect to a particular corporate trust matter, any other officer to whom
such matter is referred because of his knowledge of and familiarity with the
particular subject.

          "Securities" means any debt securities authenticated and delivered
under this Indenture.

          "Securities Act" shall mean the Securities Act of 1933, as amended.

          "Securityholder", "holder of Securities", or other similar terms,
shall mean any Person in whose name at the time a particular Security is
registered on the register kept by the Company or the Trustee for that purpose
in accordance with the terms hereof.

          "Security Register" shall mean (i) prior to a Dissolution Event, the
list of holders provided to the Trustee pursuant to Section 4.01, and (ii)
following a Dissolution Event, any security register maintained by a security
registrar for the Securities appointed by the Company.

          "Security Registrar" shall have the meaning assigned to it in Section
2.06(a).

          "Senior Indebtedness" shall mean all Indebtedness, whether outstanding
on the date of execution of this Indenture or hereafter created, assumed or
incurred, except Indebtedness Ranking on a Parity with the Securities or
Indebtedness Ranking Junior to the Securities, and any deferrals, renewals or
extensions of such Senior Indebtedness.

          ["Special Event" means either an Investment Company Event or a Tax
Event.]

          ["Special Event Redemption Price" shall mean _____________________.]

                                       -6-
<PAGE>

          "Subsidiary" shall mean with respect to any Person, (i) any
corporation at least a majority of the outstanding voting stock of which is
owned, directly or indirectly, by such Person or by one or more of its
Subsidiaries, or by such Person and one or more of its Subsidiaries, (ii) any
general partnership, joint venture or similar entity, at least a majority of
whose outstanding partnership or similar interests shall at the time be owned by
such Person, or by one or more of its Subsidiaries, or by such Person and one or
more of its Subsidiaries and (iii) any limited partnership of which such Person
or any of its Subsidiaries is a general partner. For the purposes of this
definition, "voting stock" means shares, interests, participations or other
equivalents in the equity interest (however designated) in such Person having
ordinary voting power for the election of a majority of the directors (or the
equivalent) of such Person, other than shares, interests, participations or
other equivalents having such power only by reason of the occurrence of a
contingency.

          ["Tax Event" shall mean the receipt by the Trust and the Company of an
opinion of counsel experienced in such matters to the effect that, as a result
of any amendment to, or change (including any announced prospective change) in,
the laws or any regulations thereunder of the United States or any political
subdivision or taxing authority thereof or therein or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after _____________, ____,
there is more than an insubstantial risk that (i) the Trust is, or will be
within 90 days of the date of such opinion, subject to United States Federal
income tax with respect to income received or accrued on the Securities, (ii)
interest payable by the Company on the Securities is not, or within 90 days of
the date of such opinion, will not be, deductible by the Company, in whole or in
part, for United States Federal income tax purposes, or (iii) the Trust is, or
will be within 90 days of the date of such opinion, subject to more than a de
minimis amount of other taxes, duties or other governmental charges.]

          "Trust Indenture Act" shall mean the Trust Indenture Act of 1939 as in
force at the date of execution of this Indenture; provided, however, that, in
the event the Trust Indenture Act is amended after such date, "Trust Indenture
Act" shall mean, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.

          "Trustee" shall mean the Person identified as "Trustee" in the first
paragraph hereof, and, subject to the provisions of Article VI hereof, shall
also include its successors and assigns as Trustee hereunder. The term "Trustee"
as used with respect to a particular series of the Securities shall mean the
trustee with respect to that series.

          "Trust Securities" shall mean the Preferred Securities and the Common
Securities, collectively.

SECTION 1.02  Form of Documents Delivered to Trustee.

          In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other

                                       -7-
<PAGE>

such Persons as to other matters, and any such Person may certify or give an
opinion as to such matters in one or several documents.

          Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.

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

SECTION 1.03  Successors.

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

SECTION 1.04  Indenture and Securities Solely Corporate Obligations.

          No recourse for the payment of the principal of or premium, if any, or
interest on any Security, or for any claim based thereon or otherwise in respect
thereof, and no recourse under or upon any obligation, covenant or agreement of
the Company in this Indenture, or in any Security, or because of the creation of
any indebtedness represented thereby, shall be had against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Company or of any successor Person to the Company, either directly or through
the Company or any successor Person to the Company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly understood that all such liability is
hereby expressly waived and released as a condition of, and as a consideration
for, the execution of this Indenture and the issue of the Securities.

                                       -8-
<PAGE>

SECTION 1.05  Addresses for Notices, etc.

          Any notice or demand which by any provision of this Indenture is
required or permitted to be given or served by the Trustee or by the holders of
Securities on the Company may be given or served by being deposited postage
prepaid by first class mail, registered or certified mail, overnight courier
service or conformed telecopy addressed (until another address is filed by the
Company with the Trustee for the purpose) to the Company at 1000 Louisiana,
Suite 5800, Houston, Texas 77002 Attention: Chief Financial Officer. Any notice,
direction, request or demand by any Securityholder to or upon the Trustee shall
be deemed to have been sufficiently given or made, for all purposes, if given or
made in writing at the office of the Trustee at 1 Bank One Plaza, Suite
Il1-0126, Chicago, Illinois, 60670-0126 Attention: Corporate Trust Services
Division (unless another address is provided by the Trustee to the Company for
such purpose). Any notice or communication to a Securityholder shall be mailed
by first class mail to his or her address shown on the register kept by the
Security Registrar.

SECTION 1.06  Governing Law.

          THIS INDENTURE AND EACH SECURITY SHALL BE DEEMED TO BE A CONTRACT MADE
UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID STATE.

SECTION 1.07  Evidence of Compliance with Conditions Precedent.

          Upon any application or request by the Company to the Trustee to take
any action under any of the provisions of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that in the opinion of
the signers all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with and an Opinion of
Counsel stating that, in the opinion of such counsel, all such conditions
precedent have been complied with.

          Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture (except certificates delivered pursuant to
Section 3.05) shall include (1) a statement that the Person making such
certificate or opinion has read such covenant or condition; (2) a brief
statement as to the nature and scope of the examination or investigation upon
which the statements or opinions contained in such certificate or opinion are
based; (3) a statement that, in the opinion of such Person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and (4) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.

SECTION 1.08  Business Days.

          In any case where the date of payment of principal of or premium, if
any, or interest on the Securities [or the last day on which a holder may
convert such holder's Securities] will not be a Business Day, the payment of
such principal of or premium, if any, or interest on [or conversion of] the
Securities need not be made on such date but may be made on the next succeeding
Business Day,

                                       -9-
<PAGE>

with the same force and effect as if made on the date of payment [or on such
last day for conversion] and no interest shall accrue for the period from and
after such date, except that if such next succeeding Business Day falls in the
next succeeding calendar year, then such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date.

SECTION 1.09  Trust Indenture Act to Control.

          If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.

SECTION 1.10  Table of Contents, Headings, etc.

          The table of contents and the titles and headings of the articles and
sections of this Indenture have been inserted for convenience of reference only,
are not to be considered a part hereof, and shall in no way modify or restrict
any of the terms or provisions hereof.

SECTION 1.11  Execution in Counterparts.

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

SECTION 1.12  Separability.

          In case any one or more of the provisions contained in this Indenture
or in the Securities shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Indenture or of the Securities,
but this Indenture and the Securities shall be construed as if such invalid or
illegal or unenforceable provision had never been contained herein or therein.

                                   ARTICLE II
                                   SECURITIES

SECTION 2.01  Forms Generally.

          The Securities and the Trustee's certificate of authentication shall
be substantially in the form included in Exhibit A, the terms of which are
incorporated in and made a part of this Indenture. The Securities may have
notations, legends or endorsements required by law, stock exchange rule,
agreements to which the Company is subject or usage. The Securities shall be
issued in denominations of $[__________] and integral multiples thereof.

          The Securities shall be redeemable as provided in Article X.

          The Securities shall be subordinated in right of payment to Senior
Indebtedness as provided in Article XII.

                                      -10-
<PAGE>

          [The Securities shall be convertible as set forth in Article XIII.]

SECTION 2.02  Execution and Authentication.

          The Securities shall be executed on behalf of the Company by its
Chairman of the Board, a Vice Chairman of the Board, its Chief Executive
Officer, its President or one of its Vice Presidents and attested by a
Treasurer, Assistant Treasurer, Secretary or an Assistant Secretary. The
signature of any such person on the Securities may be manual or facsimile. If an
Officer whose signature is on a Security no longer holds that office at the time
the Security is authenticated, the Security shall nevertheless be valid.

          A Security shall not be valid until authenticated by the manual or
facsimile signature of the Trustee. The signature of the Trustee shall be
conclusive evidence that the Security has been authenticated under this
Indenture. The form of Trustee's certificate of authentication to be borne by
the Securities shall be substantially as set forth in Exhibit A hereto.

          Upon a Company Order, the Trustee shall authenticate for original
issue up to, and the aggregate principal amount of Securities outstanding at any
time may not exceed $__________ aggregate principal amount of the Securities,
except as provided in Sections 2.07, 2.08 and 10.05.

          Each Security shall be dated the date of its authentication.

SECTION 2.03  Form and Payment.

          Except as provided in Section 2.04, the Securities shall be issued in
fully registered certificated form without interest coupons. Principal of,
premium, if any, and interest on the Securities issued in certificated form will
be payable, the transfer of such Securities will be registrable and such
Securities will be exchangeable for Securities bearing identical terms and
provisions at the office or agency of the Company maintained for such purpose
under Section 3.02; provided, however, that payment of interest with respect to
Securities (other than a Global Security) may be made at the option of the
Company (i) by check mailed to the holder at such address as shall appear in the
Security Register or (ii) by transfer to an account maintained by the Person
entitled thereto; provided that proper transfer instructions have been received
in writing by the relevant record date. Notwithstanding the foregoing, so long
as the holder of any Securities is the Property Trustee, the payment of the
principal of, premium, if any, and interest (including Compounded Interest and
Additional Sums, if any), on such Securities held by the Property Trustee will
be made at such place and to such account as may be designated by the Property
Trustee.

SECTION 2.04  Global Security.

          (a) In connection with a Dissolution Event,

               (i) if any Preferred Securities are held in book-entry form, the
related Definitive Securities shall be presented to the Trustee (if an
arrangement with the Depositary has been maintained) by the Property Trustee in
exchange for one or more Global Securities (as may be required pursuant to
Section 2.06) in an aggregate principal amount equal to the aggregate principal
amount of all outstanding Securities, to be registered in the name of the
Depositary, or its nominee,

                                      -11-
<PAGE>

and delivered by the Trustee to the Depositary for crediting to the accounts of
its participants pursuant to the instructions of the Administrative Trustees;
the Company upon any such presentation shall execute one or more Global
Securities in such aggregate principal amount and deliver the same to the
Trustee for authentication and delivery in accordance with this Indenture; and
payments on the Securities issued as a Global Security will be made to the
Depositary; and

               (ii) if any Preferred Securities are held in certificated form,
the related Definitive Securities may be presented to the Trustee by the
Property Trustee and any Preferred Security certificate which represents
Preferred Securities other than Preferred Securities in book-entry form ("Non
Book-Entry Preferred Securities") will be deemed to represent beneficial
interests in Securities presented to the Trustee by the Property Trustee having
an aggregate principal amount equal to the aggregate liquidation amount of the
Non Book-Entry Preferred Securities until such Preferred Security certificates
are presented to the Security Registrar for transfer or reissuance, at which
time such Preferred Security certificates will be canceled and a Security,
registered in the name of the holder of the Preferred Security certificate or
the transferee of the holder of such Preferred Security certificate, as the case
may be, with an aggregate principal amount equal to the aggregate liquidation
amount of the Preferred Security certificate canceled, will be executed by the
Company and delivered to the Trustee for authentication and delivery in
accordance with this Indenture. Upon the issuance of such Securities, Securities
with an equivalent aggregate principal amount that were presented by the
Property Trustee to the Trustee will be canceled.

          (b) The Global Securities shall represent the aggregate amount of
outstanding Securities from time to time endorsed thereon; provided, that the
aggregate amount of outstanding Securities represented thereby may from time to
time be reduced or increased, as appropriate, to reflect exchanges and
redemptions. Any endorsement of a Global Security to reflect the amount of any
increase or decrease in the amount of outstanding Securities represented thereby
shall be made by the Trustee, in accordance with instructions given by the
Company as required by this Section 2.04.

          (c) The Global Securities may be transferred, in whole but not in
part, only to the Depositary, another nominee of the Depositary, or to a
successor Depositary selected or approved by the Company or to a nominee of such
successor Depositary.

          (d) If at any time the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary or the Depositary has ceased to be
a clearing agency registered under the Exchange Act or any applicable statute or
regulation, and a successor Depositary is not appointed by the Company within 90
days after the Company receives such notice or becomes aware of such condition,
as the case may be, the Company will execute, and the Trustee, upon receipt of a
Company Order, will authenticate and make available for delivery the Definitive
Securities, in authorized denominations, and in an aggregate principal amount
equal to the principal amount of the Global Security in exchange for such Global
Security. If there is an Event of Default, the Depositary shall have the right
to exchange the Global Securities for Definitive Securities. In addition, the
Company may at any time determine that the Securities shall no longer be
represented by a Global Security. In the event of such an Event of Default or
such a determination, the Company shall execute, and subject to Section 2.06,
the Trustee, upon receipt of an Officers' Certificate evidencing such
determination by the Company and a Company Order, will authenticate and make
available for delivery the Definitive Securities, in authorized denominations,
and in an aggregate principal amount

                                      -12-
<PAGE>

equal to the principal amount of the Global Security in exchange for such Global
Security. Upon the exchange of the Global Security for such Definitive
Securities, in authorized denominations, the Global Security shall be canceled
by the Trustee. Such Definitive Securities issued in exchange for the Global
Security shall be registered in such names and in such authorized denominations
as the Depositary, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee. The Trustee shall deliver
such Definitive Securities to the Depositary for delivery to the Persons in
whose names such Definitive Securities are so registered.

SECTION 2.05  Interest.

          (a) Each Security will bear interest at the rate of ____% per annum
(the "Coupon Rate") from the most recent date to which interest has been paid or
duly provided for or, if no interest has been paid or duly provided for, from
_______________,____, until the principal thereof becomes due and payable, and
at the Coupon Rate on any overdue principal (and premium, if any) and (to the
extent that payment of such interest is enforceable under applicable law) on any
overdue installment of interest, compounded semi-annually, payable (subject to
the provisions of Section 2.13) [semi-annually] in arrears on _________ and
_______ of each year (each, an "Interest Payment Date") commencing on
___________, ___, to the Person in whose name such Security or any predecessor
Security is registered, at the close of business on the regular record date for
such interest installment, which shall be the fifteenth day of the month
immediately preceding the month in which the relevant Interest Payment Date
falls.

          (b) Interest will be computed on the basis of a 360-day year
consisting of twelve 30-day months and, for any period of less than a full
calendar month, the number of days lapsed in such month. In the event that any
Interest Payment Date falls on a day that is not a Business Day, then payment of
interest payable on such date will be made on the next succeeding day which is a
Business Day (and without any interest or other payment in respect of any such
delay), except that if such next succeeding Business Day falls in the next
succeeding calendar year, then such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on the date such payment is otherwise required.

          (c) During such time as the Property Trustee is the holder of any
Securities, the Company shall pay any additional amounts on the Securities as
may be necessary in order that the amount of Distributions then due and payable
by the Trust on the outstanding Trust Securities shall not be reduced as a
result of any additional taxes, duties and other governmental charges to which
the Trust has become subject as a result of a Tax Event ("Additional Sums").

          (d) Interest on any Security which is payable, and which is punctually
paid or duly provided for, on any Interest Payment Date shall be paid to the
Person is whose name that Security (or one or more Predecessor Securities) is
registered at the close of business on the record date for such interest
installment.

          (e) [In the case of any Security which is converted on or after any
regular record date and on or prior to the next succeeding Interest Payment Date
(other than any Security whose maturity is prior to such Interest Payment Date),
interest whose due date is on such Interest Payment Date shall be payable on
such Interest Payment Date notwithstanding such conversion, and such interest

                                      -13-
<PAGE>

(whether or not punctually paid or duly provided for) shall be paid to the
Person in whose name that Security is registered at the close of business on
such record date. Except as otherwise expressly provided in the immediately
preceding sentence, in the case of any Security that is converted prior to any
record date, interest whose due date is after the date of conversion of such
Security shall not be payable, and the Company shall not make nor be required to
make any other payment, adjustment or allowance with respect to accrued but
unpaid interest (including Additional Sums or Compound Interest) on the
Securities being converted, which shall be deemed to be paid in full.]

SECTION 2.06  Transfer and Exchange.

          (a) The Company shall maintain an office or agency where the
Securities may be presented for registration of transfer or for exchange (the
"Security Registrar"). The Company initially appoints the Trustee as Security
Registrar.

          (b) To permit registrations of transfers and exchanges, the Company
shall execute and the Trustee shall authenticate Definitive Securities and
Global Securities in any authorized denomination and of a like aggregate
principal amount at the Security Registrar's request. All Definitive Securities
and Global Securities issued upon any registration of transfer or exchange of
Definitive Securities or Global Securities shall be the valid obligations of the
Company, evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Definitive Securities or Global Securities surrendered upon
such registration of transfer or exchange.

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

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

          The Company shall not be required to (i) issue, register the transfer
of or exchange Securities during a period beginning at the opening of business
15 days before the day of mailing of a notice of redemption or any notice of
selection of Securities for redemption under Article X hereof and ending at the
close of business on the day of such mailing; or (ii) register the transfer of
or exchange any Security so selected for redemption in whole or in part, except
the unredeemed portion of any Security being redeemed in part.

          The transfer and exchange of beneficial interests in a Global
Security, which does not involve the issuance of a Definitive Security or the
transfer of an interest to another Global Security, shall be effected through
the Depositary (but not the Trustee) in accordance with the procedures of the
Depositary therefor. The Trustee will not have any responsibility for the
transfer and exchange of beneficial interests in such Global Security that does
not involve the issuance of a Definitive Security or the transfer of interests
to another Global Security.

                                      -14-
<PAGE>

          Prior to due presentment for the registration of a transfer of any
Security, the Trustee, the Company and any agent of the Trustee or the Company
may deem and treat the Person in whose name any Security is registered as the
absolute owner of such Security for the purpose of receiving payment of
principal of and premium, if any, and interest on such Securities, neither the
Trustee, nor the Company nor any agent of the Trustee or the Company shall be
affected by notice to the contrary.

SECTION 2.07  Replacement Securities.

          If any mutilated Security is surrendered to the Trustee, or the
Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, the Company shall issue and the
Trustee shall authenticate a replacement Security if the Trustee's requirements
for replacements of Securities are met. A holder requesting such replacement
Security shall supply an indemnity bond or other security that is sufficient in
the judgment of the Trustee and the Company to protect the Company, the Trustee,
any agent thereof or any authenticating agent from any loss that any of them may
suffer if a Security is replaced. The Company or the Trustee may charge for its
expenses in replacing a Security.

          Every replacement Security is an obligation of the Company and shall
be entitled to all of the benefits of this Indenture equally and proportionately
with all other Securities duly issued hereunder.

SECTION 2.08  Temporary Securities.

          Pending the preparation of Definitive Securities, the Company may
execute, and upon Company Order the Trustee shall authenticate and make
available for delivery, temporary Securities that are printed, lithographed,
typewritten, mimeographed or otherwise reproduced, in any authorized
denomination, substantially of the tenor of the Definitive Securities in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Securities may
determine, as conclusively evidenced by their execution of such Securities.

          If temporary Securities are issued, the Company shall cause Definitive
Securities to be prepared without unreasonable delay. The Definitive Securities
shall be printed, lithographed or engraved, or provided by any combination
thereof, or in any other manner permitted by the rules and regulations of any
applicable securities exchange, all as determined by the officers executing such
Definitive Securities. After the preparation of Definitive Securities, the
temporary Securities shall be exchangeable for Definitive Securities upon
surrender of the temporary Securities at the office or agency maintained by the
Company for such purpose pursuant to Section 3.02 hereof, without charge to the
Holder. Upon surrender for cancellation of any one or more temporary Securities,
the Company shall execute, and the Trustee shall authenticate and make available
for delivery, in exchange therefor the same aggregate principal amount of
Definitive Securities of authorized denominations. Until so exchanged, the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as Definitive Securities.

                                      -15-
<PAGE>

SECTION 2.09  Cancellation.

          The Company at any time may deliver Securities to the Trustee for
cancellation. The Trustee and no one else shall cancel all Securities
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and shall retain or destroy canceled Securities in accordance with
its normal practices (subject to the record retention requirement of the
Exchange Act) unless the Company directs them to be returned to it. The Company
may not issue new Securities to replace Securities that have been redeemed or
paid or that have been delivered to the Trustee for cancellation.

          All Securities surrendered for payment, redemption, [conversion,]
transfer or exchange shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee, and any such Securities and Securities surrendered
directly to the Trustee for any such purpose shall be promptly canceled by it.
Notwithstanding any other provision of this Indenture, the Company may at any
time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and all Securities so delivered shall be promptly canceled by
the Trustee. No Securities shall be authenticated in lieu of or in exchange for
any Securities canceled as provided in this Section 2.9, except as expressly
permitted by this Indenture. All canceled Securities shall be destroyed by the
Trustee and the Trustee shall deliver to the Company a certificate of such
destruction.

SECTION 2.10  Defaulted Interest.

          Any interest on any Security that is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the holder on the
relevant regular record date by virtue of having been such holder; and such
Defaulted Interest shall be paid by the Company, at its election, as provided in
clause (a) or clause (b) below:

          (a) The Company may make payment of any Defaulted Interest on
Securities to the Persons in whose names such Securities (or their respective
Predecessor Securities) are registered at the close of business on a special
record date for the payment of such Defaulted Interest, which shall be fixed in
the following manner: the Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each such Security and the
date of the proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount proposed to be
paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the proposed
payment, such money when deposited to be held in trust for the benefit of the
Persons entitled to such Defaulted Interest as in this clause provided.
Thereupon the Trustee shall fix a special record date for the payment of such
Defaulted Interest which shall not be more than 15 nor less than 10 days prior
to the date of the proposed payment and not less than 10 days after the receipt
by the Trustee of the notice of the proposed payment. The Trustee shall promptly
notify the Company of such special record date and, in the name and at the
expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the special record date therefor to be mailed, first
class postage prepaid, to each Securityholder at his or her address as it
appears in the Security Register, not less than 10 days prior to such special
record date. Notice of the proposed payment of such

                                      -16-
<PAGE>

Defaulted Interest and the special record date therefor having been mailed as
aforesaid, such Defaulted Interest shall be paid to the Persons in whose names
such Securities (or their respective Predecessor Securities) are registered on
such special record date and shall be no longer payable pursuant to the
following clause (b).

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

SECTION 2.11  CUSIP Numbers.

          The Company in issuing the Securities 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 Securityholders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers.

SECTION 2.12  Right of Set Off.

          Notwithstanding anything to the contrary in this Indenture, the
Company shall have the right to set off any payment it is otherwise required to
make hereunder to the extent the Company has theretofore made, or is
concurrently on the date of such payment making, a payment under the Preferred
Securities Guarantee.

SECTION 2.13  Extension of Interest Payment Period.

          (a) So long as no Event of Default has occurred and is continuing, the
Company shall have the right, at any time and from time to time during the term
of the Securities, to defer payments of interest by extending the interest
payment period of such Securities for a period not exceeding [10] consecutive
[semi-annual] periods (or the equivalent thereof), including the first such
[semi-annual] period during such extension period (the "Extended Interest
Payment Period"); provided that no Extended Interest Payment Period shall extend
beyond the Maturity Date. To the extent permitted by applicable law, interest,
the payment of which has been deferred because of the extension of the interest
payment period pursuant to this Section 2.13(a), will bear interest thereon at
the Coupon Rate compounded [semi-annually] for each [semi-annual] period of the
Extended Interest Payment Period ("Compounded Interest"). At the end of the
Extended Interest Payment Period, the Company shall pay all interest accrued and
unpaid on the Securities, including any Additional Sums and Compounded Interest
(together, "Deferred Interest") that shall be payable to the holders of the
Securities in whose names the Securities are registered in the Security Register
on the first record date preceding the end of the Extended Interest Payment
Period. Before the termination of any Extended Interest Payment Period, the
Company may further defer payments of interest by further extending such period;
provided that such period, together with all such previous and further

                                      -17-
<PAGE>

extensions within such Extended Interest Payment Period, shall not exceed 10
consecutive [semi-annual] periods, including the first such [semi-annual] period
during such Extended Interest Payment Period or extend beyond the Maturity Date
of the Securities. Upon the termination of any Extended Interest Payment Period
and the payment of all Deferred Interest then due, the Company may commence a
new Extended Interest Payment Period, subject to the foregoing requirements. No
interest shall be due and payable during an Extended Interest Payment Period,
except at the end thereof.

          (b) The Company shall give written notice to the Administrative
Trustees, the Property Trustee and the Trustee of its selection of such Extended
Interest Payment Period one Business Day before the earlier of (i) the next
succeeding date on which Distributions on the Trust Securities issued by the
Trust are payable, or (ii) the date the Trust is required to give notice of the
record date, or the date such Distributions are payable, to any national
securities exchange or to holders of the Preferred Securities issued by the
Trust, but in any event at least one Business Day before such record date.

          The [semi-annual] period in which any notice is given pursuant to
paragraphs (a) or (b) of this Section 2.13(b) shall be counted as one of the
[10][semi-annual] periods permitted in the maximum Extended Interest Payment
Period permitted under Section 2.13(a).

                                  ARTICLE III
                       PARTICULAR COVENANTS OF THE COMPANY

SECTION 3.01  Payment of Principal, Premium and Interest.

          The Company covenants and agrees for the benefit of the holders of the
Securities that it will duly and punctually pay or cause to be paid the
principal of, premium, if any, and interest on the Securities at the place, at
the respective times and in the manner provided herein. The Company further
covenants to pay any and all amounts, including, without limitation, Additional
Sums, as may be required pursuant to Section 2.05(c) and Compounded Interest, as
may be required pursuant to Section 2.13(a).

SECTION 3.02  Offices for Notices and Payments, etc.

          So long as any of the Securities remain outstanding, the Company will
maintain in New York, New York, an office or agency where the Securities may be
presented for payment, an office or agency where the Securities may be presented
for registration of transfer and for exchange as in this Indenture provided and
an office or agency where notices and demands to or upon the Company in respect
of the Securities or of this Indenture may be served. The Company will give to
the Trustee written notice of the location of any such office or agency and of
any change of location thereof. Until otherwise designated from time to time by
the Company in a notice to the Trustee, any such office or agency for all of the
above purposes shall be the Principal Office of the Trustee. In case the Company
shall fail to maintain any such office or agency in New York, New York, or shall
fail to give such notice of the location or of any change in the location
thereof, presentations and demands may be made and notices may be served at the
Principal Office of the Trustee.

                                      -18-
<PAGE>

SECTION 3.03  Appointments to Fill Vacancies in Trustee's Office.

          The Company, whenever necessary to avoid or fill a vacancy in the
office of Trustee, will appoint, in the manner provided in Section 6.10, a
Trustee, so that there shall at all times be a Trustee hereunder.

SECTION 3.04  Provision as to Paying Agent [and Conversion Agent].

          (a) If the Company shall appoint a paying agent other than the Trustee
with respect to the Securities, it will cause such paying agent to execute and
deliver to the Trustee an instrument in which such agent shall agree with the
Trustee, subject to the provision of this Section 3.04,

               (i) that it will hold all sums held by it as such agent for the
payment of the principal of and premium, if any, or interest on the Securities
(whether such sums have been paid to it by the Company or by any other obligor
on the Securities) in trust for the benefit of the holders of the Securities and
comply with all provisions of the Trust Indenture Act applicable to it as paying
agent; and

               (ii) that it will give the Trustee notice of any failure by the
Company (or by any other obligor on the Securities) to make any payment of the
principal of and premium or interest (including Additional Sums and Compounded
Interest, if any) on the Securities when the same shall be due and payable.

          (b) If the Company shall act as its own paying agent, it will, on or
before each due date of the principal of and premium, if any, or interest on the
Securities, set aside, segregate and hold in trust for the benefit of the
holders of the Securities a sum sufficient to pay such principal, premium or
interest so becoming due and will notify the Trustee of any failure to take such
action and of any failure by the Company (or by any other obligor under the
Securities) to make any payment of the principal of and premium, if any, or
interest on the Securities when the same shall become due and payable.

          (c) Anything in this Section 3.04 to the contrary notwithstanding, the
Company may, at any time, for the purpose of obtaining a satisfaction and
discharge with respect to the Securities hereunder, or for any other reason, pay
or cause to be paid to the Trustee all sums held in trust for such Securities by
the Trustee or any paying agent hereunder, as required by this Section 3.04,
such sums to be held by the Trustee upon the trusts herein contained.

          (d) Anything in this Section 3.04 to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section 3.04 is subject to
Sections 11.03 and 11.04.

          (e) The Trustee will initially act as paying agent, Security Registrar
[and Conversion Agent]. The Company may change any such entity without prior
notice. The Company or its Affiliates may act in any of the foregoing
capacities.

                                      -19-
<PAGE>

SECTION 3.05  Certificate to Trustee.

          The Company will deliver to the Trustee on or before 120 days after
the end of each fiscal year in each year, commencing with the first fiscal year
ending after the date hereof, so long as Securities are outstanding hereunder,
an Officers' Certificate, one of the signers of which shall be the principal
executive, principal financial or principal accounting officer of the Company,
stating that in the course of the performance by the signers of their duties as
officers of the Company they would normally have knowledge of any default by the
Company in the performance of any covenants contained herein, stating whether or
not they have knowledge of any such default and, if so, specifying each such
default of which the signers have knowledge and the nature thereof.

SECTION 3.06  Compliance with Consolidation Provisions.

          The Company will not, while any of the Securities remain outstanding,
consolidate with, or merge into, or merge into itself, or sell or convey all or
substantially all of its property to any other Person unless the provisions of
Article VIII hereof are complied with.

SECTION 3.07  Limitation on Certain Payments.

          The Company will not (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire, or make a liquidation payment with respect to,
any of the Company's capital stock (which includes common and preferred stock)
(other than (a) dividends or distributions in shares of, or options, warrants or
rights to subscribe for or purchase shares of, Common Stock of the Company, (b)
any declaration of a dividend in connection with the implementation of a
shareholder's rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
as a result of a reclassification of the Company's capital stock or the exchange
or the conversion of one class or series of the Company's capital stock for
another class or series of the Company's capital stock, (d) the purchase of
fractional interests in shares of the Company's capital stock pursuant to the
conversion or exchange provisions of such capital stock or the security being
converted or exchanged, and (e) purchases of Common Stock related to the
issuance of Common Stock or rights under any of the Company's benefit plans for
its directors, officers, employees or consultants or any of the Company's
dividend reinvestment plans), (ii) make any payment of principal, premium, if
any, or interest on or repay or repurchase or redeem any debt securities of the
Company that in the right of payment rank pari passu with or junior to the
Securities or (iii) make any guarantee payments with respect to any guarantee by
the Company (other than payments under the Preferred Securities Guarantee) of
the debt securities of any Subsidiary of the Company if in the right of payment
such guarantee ranks pari passu with or junior to the Securities if at such time
(1) there shall have occurred any event of which the Company has actual
knowledge that (a) with the giving of notice or the lapse of time, or both,
would constitute an Event of Default and (b) in respect of which the Company
shall not have taken reasonable steps to cure, (2) an Event of Default hereunder
shall have occurred and be continuing, (3) if such Securities are held by the
Property Trustee, the Company shall be in default with respect to its payment
obligations under the Preferred Securities Guarantee or (4) the Company shall
have given notice of its election of the exercise of its right to extend the
interest payment period pursuant to Section 2.13(a) and any such extension shall
be continuing.

                                      -20-
<PAGE>

SECTION 3.08  Covenants as to Dynegy Capital Trust III

          In the event Securities are issued to the Trust or a trustee of such
trust in connection with the issuance of Trust Securities by the Trust, for so
long as such Trust Securities remain outstanding, the Company (i) will maintain
100% direct or indirect ownership of the Common Securities of the Trust;
provided, however, that any successor of the Company, permitted pursuant to
Article VIII, may succeed to the Company's ownership of such Common Securities,
(ii) will use its reasonable efforts to cause the Trust (a) to remain a business
trust, except in connection with a distribution of Securities to the holders of
Trust Securities in liquidation of the Trust, the redemption of all of the Trust
Securities of the Trust or certain mergers, consolidations or amalgamations,
each as permitted by the Declaration, and (b) to otherwise continue to be
treated as a grantor trust and not an association taxable as a corporation for
United States federal income tax purposes and (iii) use its reasonable efforts
to cause each holder of Trust Securities to be treated as owning an undivided
beneficial interest in the Securities.

SECTION 3.09  Payment of Trust's Costs and Expenses.

          In connection with the offering, sale and issuance of the Securities
to the Trust and in connection with the sale of the Trust Securities by the
Trust, the Company, in its capacity as borrower with respect to the Securities,
shall:

          (a) pay all costs and expenses relating to the offering, sale and
issuance of the Securities and compensation of the Trustee in accordance with
the provisions of Section 6.06;

          (b) pay all costs and expenses of the Trust (including, but not
limited to, costs and expenses relating to the organization of the Trust, the
offering, sale and issuance of the Trust Securities (including commissions to
the initial purchaser in connection therewith), the fees and expenses of the
Property Trustee and the Delaware Trustee, the costs and expenses relating to
the operation of the Trust, including without limitation, costs and expenses of
accountants, attorneys, statistical or bookkeeping services, expenses for
printing and engraving and computing or accounting equipment, paying agent(s),
registrar(s), transfer agent(s), duplicating, travel and telephone and other
telecommunications expenses and costs and expenses incurred in connection with
the acquisition, financing, and disposition of assets of the Trust;

          (c) be primarily and fully liable for any indemnification obligations
arising with respect to the Declaration;

          (d) pay any and all taxes, duties, assessments or governmental charges
of whatever nature (other than United States withholding taxes attributable to
the Trust or its assets) imposed on the Trust by the United States, or any other
taxing authority, and all liabilities, costs and expenses with respect to such
taxes of the Trust; and

          (e) pay all other fees, expenses, debts and obligations (other than in
respect of distributions or other amounts payable with respect to the Trust
Securities) related to the Trust.

                                      -21-
<PAGE>

          The foregoing obligations of the Company are for the benefit of, and
shall be enforceable by, any person to whom any such debt, obligations, costs,
expenses and taxes are owed (each, a "Creditor") whether or not such Creditor
has received notice thereof. Any such Creditor may enforce such obligations of
the Company directly against the Company, and the Company irrevocably waives any
right or remedy to require that any such Creditor take any action against the
Trust or any person before proceeding against the Company. The Company shall
execute such additional agreements as may be necessary or desirable to give full
effect to the foregoing.

                                   ARTICLE IV
                    SECURITYHOLDERS' LISTS AND REPORTS BY THE
                             COMPANY AND THE TRUSTEE

SECTION 4.01  Securityholders' Lists.

          The Company covenants and agrees that it will furnish or cause to be
furnished to the Trustee:

          (a) on a semi-annual basis on each regular record date for the
Securities, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Securityholders as of such record date; and

          (b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company, of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such list
is furnished, except that, no such lists need be furnished so long as the
Trustee is in possession thereof by reason of its acting as Security Registrar.

SECTION 4.02  Preservation and Disclosure of Lists.

          (a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the holders of the
Securities (1) contained in the most recent list furnished to it as provided in
Section 4.01 or (2) received by it in the capacity of Securities registrar (if
so acting) hereunder. The Trustee may destroy any list furnished to it as
provided in Section 4.01 upon receipt of a new list so furnished.

          (b) The rights of holders of Securities to communicate with other
holders with respect to their rights under this Indenture or under the
Securities, and the corresponding rights and duties of the Trustee, shall be as
provided by the Trust Indenture Act.

          (c) Every holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of either of them shall be held accountable by reason of any
disclosure of information as to names and addresses of holders made pursuant to
the Trust Indenture Act.

SECTION 4.03  Reports by Company.

          (a) In accordance with the Trust Indenture Act, the Company covenants
and agrees to file with the Trustee, within 15 days after the date on which the
Company is required to file the same

                                      -22-
<PAGE>

with the Commission, copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of the foregoing
as said Commission may from time to time by rules and regulations prescribe)
which the Company may be required to file with the Commission pursuant to
Section 13 or Section 15(d) of the Exchange Act; or, if the Company is not
required to file information, documents or reports pursuant to either of such
sections, then to file with the Trustee and the Commission, in accordance with
rules and regulations prescribed from time to time by the Commission, such of
the supplementary and periodic information, documents and reports which may be
required pursuant to Section 13 of the Exchange Act in respect of a security
listed and registered on a national securities exchange as may be prescribed
from time to time in such rules and regulations.

          (b) The Company covenants and agrees to file with the Trustee and the
Commission, in accordance with the rules and regulations prescribed from time to
time by said Commission, such additional information, documents and reports with
respect to compliance by the Company with the conditions and covenants provided
for in this Indenture as may be required from time to time by such rules and
regulations.

          (c) Delivery of such reports, information and documents to the Trustee
is for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).

SECTION 4.04  Reports by the Trustee.

          (a) The Trustee shall transmit to Securityholders such reports
concerning the Trustee and its actions under this Indenture as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided
pursuant thereto. If required by Section 313(a) of the Trust Indenture Act, the
Trustee shall, within sixty days after each ___________ following the date of
this Indenture, commencing _____________, ____, deliver to Securityholders a
brief report, dated as of such __________, which complies with the provisions of
such Section 313(a).

          (b) A copy of each such report shall, at the time of such transmission
to Securityholders, be filed by the Trustee with each stock exchange, if any,
upon which the Securities are listed, with the Commission and with the Company.
The Company will promptly notify the Trustee when the Securities are listed on
any stock exchange.

                                    ARTICLE V
                   REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
                               ON EVENT OF DEFAULT

SECTION 5.01  Events of Default.

          "Event of Default", wherever used herein with respect to Securities,
means any one of the following events (whatever the reason for such Event of
Default and whether it shall be voluntary or

                                      -23-
<PAGE>

involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):

          (a) default in the payment of any interest (including Compounded
Interest or Additional Sums, if any), upon any Security when it becomes due and
payable, and continuance of such default for a period of 30 days; provided,
however, that a valid extension of an interest payment period by the Company in
accordance with the terms hereof shall not constitute a default in the payment
of interest for this purpose; or

          (b) default in the payment of all or any part of the principal of (or
premium, if any, on) any Security as and when the same shall become due and
payable either at maturity, upon redemption, by declaration of acceleration of
maturity or otherwise; or

          (c) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture (other than a covenant or warranty a default in
whose performance or whose breach is elsewhere in this Section specifically
dealt with), and continuance of such default or breach for a period of 90 days
after there has been given, by registered or certified mail, to the Company by
the Trustee or to the Company and the Trustee by the holders of at least 25% in
aggregate principal amount of the outstanding Securities a written notice
specifying such default or breach and requiring it to be remedied and stating
that such notice is a "Notice of Default" hereunder; or

          (d) a court having jurisdiction in the premises shall enter a decree
or order for relief in respect of the Company in an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of the Company or for any substantial part of
its property, or ordering the winding-up or liquidation of its affairs and such
decree or order shall remain unstayed and in effect for a period of 90
consecutive days; or

          (e) the Company shall commence a voluntary case under any applicable
bankruptcy, insolvency, reorganization or other similar law now or hereafter in
effect, shall consent to the entry of an order for relief in an involuntary case
under any such law, or shall consent to the appointment of or taking possession
by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other
similar official) of the Company or of any substantial part of its property, or
shall make any general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due[; or

          (f) the failure by the Company to deliver Common Stock upon an
election to convert the Securities into Common Stock].

          If an Event of Default with respect to Securities at the time
outstanding occurs and is continuing, then in every such case the Trustee or the
holders of not less than 25% in aggregate principal amount of the Securities
then outstanding may declare the principal amount of all Securities to be due
and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by the holders of the outstanding Securities), and upon any
such declaration the same shall become immediately due and payable. Payment of
principal and interest (including any Compounded Interest and Additional Sums to
the extent permitted by applicable law) on such

                                      -24-
<PAGE>

Securities shall remain subordinated to the extent provided in Article XII
notwithstanding that such amount shall become immediately due and payable as
herein provided.

          The foregoing provisions, however, are subject to the condition that
if, at any time after the principal of the Securities shall have been so
declared due and payable, and before any judgment or decree for the payment of
the moneys due shall have been obtained or entered as hereinafter provided, (i)
the Company shall pay or shall deposit with the Trustee a sum sufficient to pay
(A) all matured installments of interest (including Compounded Interest and
Additional Sums, if any) upon all the Securities and the principal of and
premium, if any, on any and all Securities which shall have become due otherwise
than by acceleration (with interest upon such principal and premium, if any,
and, to the extent that payment of such interest is enforceable under applicable
law, on overdue installments of interest, at the same rate as the rate of
interest specified in the Securities to the date of such payment or deposit) and
(B) such amount as shall be sufficient to cover compensation due to the Trustee
and each predecessor Trustee, their respective agents, attorneys and counsel,
pursuant to Section 6.06, and (ii) any and all Events of Default under the
Indenture, other than the non-payment of the principal of the Securities which
shall have become due solely by such declaration of acceleration, shall have
been cured, waived or otherwise remedied as provided herein, then, in every such
case, the holders of a majority in aggregate principal amount of the Securities
then outstanding, by written notice to the Company and to the Trustee, may
rescind and annul such declaration and its consequences, but no such waiver or
rescission and annulment shall extend to or shall affect any subsequent default
or shall impair any right consequent thereon.

          In case the Trustee or any holder shall have proceeded to enforce any
right under this Indenture and such proceedings shall have been discontinued or
abandoned because of such rescission or annulment or for any other reason or
shall have been determined adversely to the Trustee or such holder, then and in
every such case the Company, the Trustee and the holders of the Securities shall
be restored respectively to their several positions and rights hereunder, and
all rights, remedies and powers of the Company, the Trustee and the holders of
the Securities shall continue as though no such proceeding had been taken.

SECTION 5.02  Payment of Securities on Default; Suit Therefor.

          The Company covenants that (a) in case default shall be made in the
payment of any installment of interest (including Compounded Interest and
Additional Sums, if any) upon any of the Securities as and when the same shall
become due and payable, and such default shall have continued for a period of 30
days, or (b) in case default shall be made in the payment of the principal of or
premium, if any, on any of the Securities as and when the same shall have become
due and payable, whether at maturity of the Securities or upon redemption or by
declaration or otherwise, then, upon demand of the Trustee, the Company will pay
to the Trustee, for the benefit of the holders of the Securities, the whole
amount that then shall have become due and payable on all such Securities for
principal and premium, if any, or interest (including Compounded Interest and
Additional Sums, if any) or both, as the case may be, with interest upon the
overdue principal and premium, if any, and (to the extent that payment of such
interest is enforceable under applicable law and, if the Securities are held by
the Trust or a trustee of such trust, without duplication of any other amounts
paid by the Trust or a trustee in respect thereof) upon the overdue installments
of interest (including Compounded Interest and Additional Sums, if any) at the
rate borne by the Securities;

                                      -25-
<PAGE>

and, in addition thereto, such further amount as shall be sufficient to cover
the costs and expenses of collection, including a reasonable compensation to the
Trustee, its agents, attorneys and counsel, and any other amount due to the
Trustee pursuant to Section 6.06.

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

          In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor on the Securities under
Title 11, United States Code, or any other applicable law, or in case a receiver
or trustee shall have been appointed for the property of the Company or such
other obligor, or in the case of any other similar judicial proceedings relative
to the Company or other obligor upon the Securities, or to the creditors or
property of the Company or such other obligor, the Trustee, irrespective of
whether the principal of the Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand pursuant to the provisions of this Section 5.02,
shall be entitled and empowered, by intervention in such proceedings or
otherwise, to file and prove a claim or claims for the whole amount of principal
premium, if any, and interest (including Compounded Interest and Additional
Sums, if any) owing and unpaid in respect of the Securities and, in case of any
judicial proceedings, to file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee
(including any claim for amounts due to the Trustee pursuant to 6.06) and of the
Securityholders allowed in such judicial proceedings relative to the Company or
any other obligor on the Securities, or to the creditors or property of the
Company or such other obligor, unless prohibited by applicable law and
regulations, to vote on behalf of the holders of the Securities in any election
of a trustee or a standby trustee in arrangement, reorganization, liquidation or
other bankruptcy or insolvency proceedings or person performing similar
functions in comparable proceedings, and to collect and receive any moneys or
other property payable or deliverable on any such claims, and to distribute the
same after the deduction of its charges and expenses; and any receiver, assignee
or trustee in bankruptcy or reorganization is hereby authorized by each of the
Securityholders to make such payments to the Trustee, and, in the event that the
Trustee shall consent to the making of such payments directly to the
Securityholders, to pay to the Trustee such amounts as shall be sufficient to
cover reasonable compensation to the Trustee, each predecessor Trustee and their
respective agents, attorneys and counsel, and all other amounts due to the
Trustee pursuant to Section 6.06.

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

          All rights of action and of asserting claims under this Indenture, or
under any of the Securities, may be enforced by the Trustee without the
possession of any of the Securities, or the

                                      -26-
<PAGE>

production thereof on any trial or other proceeding relative thereto, and any
such suit or proceeding instituted by the Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment shall be for
the ratable benefit of the holders of the Securities.

          In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the holders
of the Securities, and it shall not be necessary to make any holders of the
Securities parties to any such proceedings.

SECTION 5.03  Application of Moneys Collected by Trustee.

          Any moneys collected by the Trustee shall be applied in the order
following, at the date or dates fixed by the Trustee for the distribution of
such moneys, upon presentation of the Securities in respect of which moneys have
been collected, and stamping thereon the payment, if only partially paid, and
upon surrender thereof if fully paid:

          FIRST: To the payment of costs and expenses of collection applicable
to the Securities and all other amounts due to the Trustee under Section 6.06;

          SECOND: To the payment of all Senior Indebtedness of the Company if
and to the extent required by Article XII;

          THIRD: To the payment of the amounts then due and unpaid upon
Securities for principal of (and premium, if any) and interest (including
Compounded Interest and Additional Sums, if any) on the Securities, in respect
of which or for the benefit of which money has been collected, ratably, without
preference of priority of any kind, according to the amounts due on such
Securities for principal (and premium, if any) and interest, respectively; and

          FOURTH: To the Company.

SECTION 5.04  Proceedings by Securityholders.

          No holder of any Security shall have any right by virtue of or by
availing of any provision of this Indenture to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Indenture
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless such holder previously shall have given to the Trustee written
notice of an Event of Default and of the continuance thereof with respect to the
Securities specifying such Event of Default, as hereinbefore provided, and
unless also the holders of not less than 25% in aggregate principal amount of
the Securities then outstanding shall have made written request upon the Trustee
to institute such action, suit or proceeding in its own name as Trustee
hereunder and shall have offered to the Trustee such reasonable indemnity as it
may require against the costs, expenses and liabilities to be incurred therein
or thereby, and the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity shall have failed to institute any such action,
suit or proceeding, it being understood and intended, and being expressly
covenanted by the taker and holder of every Security with every other taker and
holder and the Trustee, that no one or more holders of Securities shall have any
right in any manner whatever by virtue of or by availing of any provision of
this

                                      -27-
<PAGE>

Indenture to affect, disturb or prejudice the rights of any other holder of
Securities, or to obtain or seek to obtain priority over or preference to any
other such holder, or to enforce any right under this Indenture, except in the
manner herein provided and for the equal, ratable and common benefit of all
holders of Securities.

          Notwithstanding any other provisions in this Indenture, however, the
right of any holder of any Security, which right is absolute and unconditional,
to receive payment of the principal of (premium, if any) and interest (including
Compounded Interest and Additional Sums, if any) on such Security, on or after
the same shall have become due and payable, or to institute suit for the
enforcement of any such payment, shall not be impaired or affected without the
consent of such holder and by accepting a Security hereunder it is expressly
understood, intended and covenanted by the taker and holder of every Security
with every other such taker and holder and the Trustee, that no one or more
holders of Securities shall have any right in any manner whatsoever by virtue or
by availing of any provision of this Indenture to affect, disturb or prejudice
the rights of the holders of any other Securities, or to obtain or seek to
obtain priority over or preference to any other such holder, or to enforce any
right under this Indenture, except in the manner herein provided and for the
equal, ratable and common benefit of all holders of Securities. For the
protection and enforcement of the provisions of this Section, each and every
Securityholder and the Trustee shall be entitled to such relief as can be given
either at law or in equity.

          If an Event of Default has occurred and is continuing and such event
is attributable to the failure of the Company to pay principal of or premium, if
any, or interest on the Securities when due, the Company acknowledges that a
holder of Preferred Securities may directly institute a proceeding for
enforcement of payment to such holder of the principal of or premium, if any, or
interest on the Securities having a principal amount equal to the aggregate
liquidation amount of the Preferred Securities of such holder on or after the
respective due date specified in the Securities.

SECTION 5.05  Proceedings by Trustee.

          In case an Event of Default occurs with respect to Securities and is
continuing, the Trustee may in its discretion proceed to protect and enforce the
rights vested in it by this Indenture by such appropriate judicial proceedings
as the Trustee shall deem most effectual to protect and enforce any of such
rights, either by suit in equity or by action at law or by proceeding in
bankruptcy or otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any power
granted in this Indenture, or to enforce any other legal or equitable right
vested in the Trustee by this Indenture or by law.

SECTION 5.06  Remedies Cumulative and Continuing.

          All powers and remedies given by this Article V to the Trustee or to
the Securityholders shall, to the extent permitted by law, be deemed cumulative
and not exclusive of any other powers and remedies available to the Trustee or
the holders of the Securities, by judicial proceedings or otherwise, to enforce
the performance or observance of the covenants and agreements contained in this
Indenture or otherwise established with respect to the Securities, and no delay
or omission of the Trustee or of any holder of any of the Securities to exercise
any right or power accruing upon any Event of Default occurring and continuing
as aforesaid shall impair any such right or power, or shall

                                      -28-
<PAGE>

be construed to be a waiver of any such default or an acquiescence therein; and,
subject to the provisions of Section 5.04, every power and remedy given by this
Article V or by law to the Trustee or to the Securityholders may be exercised
from time to time, and as often as shall be deemed expedient, by the Trustee or
by the Securityholders.

SECTION 5.07  Direction of Proceedings and Waiver of Defaults by Majority of
              Securityholders.

          The holders of a majority in aggregate principal amount of the
Securities at the time outstanding shall have the right to direct the time,
method, and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred on the Trustee; provided,
however, that such direction shall not be in conflict with any rule or law or
with this Indenture and, (subject to the provisions of Section 6.01) the Trustee
shall have the right to decline to follow any such direction if the Trustee
shall determine that the action so directed would be unjustly prejudicial to the
holders not taking part in such direction or if the Trustee being advised by
counsel determines that the action or proceeding so directed may not lawfully be
taken or if the Trustee in good faith by its board of directors or trustees,
executive committee, or a trust committee of directors or trustees and/or
Responsible Officers shall determine that the action or proceedings so directed
would involve the Trustee in personal liability.

          Prior to any declaration accelerating the maturity of the Securities,
the holders of a majority in aggregate principal amount of the Securities at the
time outstanding may on behalf of the holders of all of the Securities waive any
past default or Event of Default and its consequences except (a) a continuing
default in the payment of principal of or premium, if any, or interest
(including Compounded Interest and Additional Sums, if any) on any of the
Securities or (b) a default in respect of covenants or provisions hereof which
cannot be modified or amended without the consent of the holder of each Security
(or Preferred Security) affected. Upon any such waiver, the default covered
thereby shall be deemed to be cured for all purposes of this Indenture and the
Company, the Trustee and the holders of the Securities shall be restored to
their former positions and rights hereunder, respectively; but no such waiver
shall extend to any subsequent or other default or impair any right consequent
thereon. Whenever any default or Event of Default hereunder shall have been
waived as permitted by this Section 5.07, said default or Event of Default shall
for all purposes of the Securities and this Indenture be deemed to have been
cured and to be not continuing.

SECTION 5.08  Notice of Defaults.

          (a) The Trustee shall, within 90 days after the occurrence of a
default with respect to the Securities known to a Responsible Officer of the
Trustee, mail to all Securityholders, as the names and addresses of such holders
appear upon the Security Register, notice of all defaults known to the Trustee,
unless such defaults shall have been cured before the giving of such notice (the
term "defaults" for the purpose of this Section 5.08 being hereby defined to be
the events specified in clauses (a), (b), (c), (d) and (e) of Section 5.01, not
including periods of grace, if any, provided for therein, and irrespective of
the giving of written notice specified in clause (c) of Section 5.01); and
provided that, except in the case of default in the payment of the principal of
or premium, if any, or interest (including Compounded Interest or Additional
Sums, if any) on any of the Securities, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the

                                      -29-
<PAGE>

executive committee, or a trust committee of directors and/or Responsible
Officers of the Trustee in good faith determines that the withholding of such
notice is in the interests of the Securityholders; and provided further, that in
the case of any default of the character specified in Section 5.01(c) no such
notice to Securityholders shall be given until at least 60 days after the
occurrence thereof but shall be given within 90 days after such occurrence.

          (b) Within five Business Days after the occurrence of any Event of
Default actually known to the Trustee, the Trustee shall transmit notice of such
Event of Default to all Securityholders, unless such Event of Default shall have
been cured or waived.

SECTION 5.09  Undertaking to Pay Costs.

          All parties to this Indenture agree, and each holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken or
omitted by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section 5.09 shall not apply to any suit instituted by
the Company or the Trustee; to any suit instituted by any Securityholder, or
group of Securityholders, holding in the aggregate more than 25% in aggregate
principal amount of the Securities outstanding; or to any suit instituted by any
Securityholder for the enforcement of the payment of the principal of (or
premium, if any) or interest (including Compounded Interest and Additional Sums,
if any) on any Security against the Company on or after the same shall have
become due and payable.

SECTION 5.10  Waiver of Stay or Extension Laws.

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

                                   ARTICLE VI
                             CONCERNING THE TRUSTEE

SECTION 6.01  Duties and Responsibilities of Trustee.

          With respect to the holders of the Securities issued hereunder, the
Trustee, prior to the occurrence of an Event of Default and after the curing or
waiving of all Events of Default which may have occurred, undertakes to perform
such duties and only such duties as are specifically set forth in this
Indenture. In case an Event of Default has occurred (which has not been cured or
waived) the Trustee shall exercise such of the rights and powers vested in it by
this Indenture, and use the same

                                      -30-
<PAGE>

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

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

          (a) prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default which may have occurred,

               (i) the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Indenture and the Trust Indenture Act,
and the Trustee shall not be liable except for the performance of such duties
and obligations as are specifically set forth in this Indenture or in the Trust
Indenture Act, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and

               (ii) in the absence of bad faith on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates or opinions
furnished to the Trustee and conforming to the requirements of this Indenture;
but, in the case of any such certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the Trustee
shall be under a duty to examine the same to determine whether or not they
conform to the requirements of this Indenture;

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

          (c) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith, in accordance with the direction of
the Securityholders pursuant to Section 5.07, relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this Indenture.

          None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or liability is not reasonably assured to it under the
terms of this Indenture or adequate indemnity against such risk is not
reasonably assured to it.

SECTION 6.02  Reliance on Documents, Opinions, etc.

          Except as otherwise provided in Section 6.01:

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

                                      -31-
<PAGE>

          (b) any request, direction, order or demand of the Company mentioned
herein may be sufficiently evidenced by an Officers' Certificate (unless other
evidence in respect thereof be herein specifically prescribed); and any Board
Resolution may be evidenced to the Trustee by a copy thereof certified by the
Secretary or an Assistant Secretary of the Company;

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

          (d) 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 Securityholders, pursuant to the provisions of this
Indenture, unless such Securityholders shall have offered to the Trustee
reasonable and sufficient security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby;

          (e) the Trustee shall not be liable for any action taken or omitted by
it in good faith and believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Indenture; nothing contained herein
shall, however, relieve the Trustee of the obligation, upon the occurrence of an
Event of Default (that has not been cured or waived), to exercise such of the
rights and powers vested in it by this Indenture, and to use the same degree of
care and skill in their exercise, as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs;

          (f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond, debenture,
coupon or other paper or document, unless requested in writing to do so by the
holders of a majority in aggregate principal amount of the outstanding
Securities; provided, however, that if the payment within a reasonable time to
the Trustee of the costs, expenses or liabilities likely to be incurred by it in
the making of such investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to it by the terms of
this Indenture, the Trustee may require reasonable indemnity against such
expense or liability as a condition to so proceeding;

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

          (h) the Trustee shall not be charged with knowledge of any Default or
Event of Default with respect to the Securities unless (1) such default is a
default under Sections 5.01(a) and 5.01(b) of the Indenture, (2) a Responsible
Officer shall have actual knowledge of such Default or Event of Default or (3)
written notice of such Default or Event of Default shall have been given to the
Trustee by the Company or any other obligor on the Securities or by any holder
of the Securities; and

                                      -32-
<PAGE>

          (i) the Trustee shall not be liable for any action taken, suffered or
omitted by it in good faith, without negligence or willful misconduct and
believed by it to be authorized or within the discretion or rights or powers
conferred upon it by this Indenture.

SECTION 6.03  No Responsibility for Recitals, etc.

          The recitals contained herein and in the Securities (except in the
certificate of authentication of the Trustee or the Authenticating Agent) shall
be taken as the statements of the Company and the Trustee and the Authenticating
Agent assume no responsibility for the correctness of the same. The Trustee and
the Authenticating Agent make no representations as to the validity or
sufficiency of this Indenture or of the Securities. The Trustee and the
Authenticating Agent shall not be accountable for the use or application by the
Company of any Securities or the proceeds of any Securities authenticated and
delivered by the Trustee or the Authenticating Agent in conformity with the
provisions of this Indenture.

SECTION 6.04  Trustee, Authenticating Agent, Paying Agents, Transfer Agents or
              Registrar May Own Securities.

          The Trustee or any Authenticating Agent or any paying agent or any
transfer agent or any Security Registrar, in its individual or any other
capacity, may become the owner or pledgee of Securities with the same rights it
would have if it were not Trustee, Authenticating Agent, paying agent, transfer
agent or Security Registrar.

SECTION 6.05  Moneys to be Held in Trust.

          Subject to the provisions of Section 11.04, all moneys received by the
Trustee or any paying agent shall, until used or applied as herein provided, be
held in trust for the purpose for which they were received, but need not be
segregated from other funds except to the extent required by law. The Trustee
and any paying agent shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing with the Company.
So long as no Event of Default shall have occurred and be continuing, all
interest allowed on any such moneys shall be paid from time to time upon the
written order of the Company, signed by the Chairman of the Board of Directors,
the President, a Vice President, the Treasurer or an Assistant Treasurer of the
Company.

SECTION 6.06  Compensation and Expenses of Trustee.

          The Company, as issuer of Securities under this Indenture, covenants
and agrees to pay to the Trustee from time to time, and the Trustee shall be
entitled to, such compensation as shall be agreed to in writing between the
Company and the Trustee (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust), and the Company
will pay or reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any of the provisions of this Indenture (including the reasonable compensation
and the expenses and disbursements of its counsel and of all persons not
regularly in its employ) except any such expense, disbursement or advance as may
arise from its negligence or bad faith. The Company also covenants to indemnify
each of the Trustee or any predecessor Trustee (and its officers, agents,
directors and employees) for, and to hold it harmless

                                      -33-
<PAGE>

against, any and all loss, damage, claim, liability or expense including taxes
(other than taxes based on the income of the Trustee) incurred without
negligence or bad faith on the part of the Trustee and arising out of or in
connection with the acceptance or administration of this trust, including the
costs and expenses of defending itself against any claim of liability in the
premises. The obligations of the Company under this Section 6.06 to compensate
and indemnify the Trustee and to pay or reimburse the Trustee for expenses,
disbursements and advances shall constitute additional indebtedness hereunder.
Such additional indebtedness shall be secured by a lien prior to that of the
Securities upon all property and funds held or collected by the Trustee as such,
except funds held in trust for the benefit of the holders of particular
Securities.

          When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 5.01(d) or Section 5.01(e), the
expenses (including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable federal or state bankruptcy, insolvency or
other similar law.

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

SECTION 6.07  Officers' Certificate as Evidence.

          Except as otherwise provided in Sections 6.01 and 6.02, whenever in
the administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or
omitting any action hereunder, such matter (unless other evidence in respect
thereof is herein specifically prescribed) may, in the absence of negligence or
bad faith on the part of the Trustee, be deemed to be conclusively proved and
established by an Officers' Certificate delivered to the Trustee, and such
certificate, in the absence of negligence or bad faith on the part of the
Trustee, shall be full warrant to the Trustee for any action taken or omitted by
it under the provisions of this Indenture upon the faith thereof.

SECTION 6.08  Conflicting Interest of Trustee.

          If the Trustee has or shall acquire any "conflicting interest" within
the meaning of Section 310(b) of the Trust Indenture Act, the Trustee and the
Company shall in all respects comply with the provisions of Section 310(b) of
the Trust Indenture Act.

SECTION 6.09  Eligibility of Trustee.

          The Trustee hereunder shall at all times be a corporation organized
and doing business under the laws of the United States of America or any state
or territory thereof or of the District of Columbia or a corporation or other
Person permitted to act as trustee by the Commission authorized under such laws
to exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000 and subject to supervision or examination by federal, state,
territorial, or District of Columbia authority. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purposes of
this Section 6.09 the combined capital and surplus of such corporation shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published.

                                      -34-
<PAGE>

          The Company may not, nor may any Person directly or indirectly
controlling, controlled by, or under common control with the Company, serve as
Trustee.

          In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 6.09, the Trustee shall resign
immediately in the manner and with the effect specified in Section 6.10.

SECTION 6.10  Resignation or Removal of Trustee.

          (a) The Trustee, or any trustee or trustees hereafter appointed, may
at any time resign by giving written notice of such resignation to the Company
and by mailing notice thereof to the holders of the Securities at their
addresses as they shall appear on the Security register. Upon receiving such
notice of resignation, the Company shall promptly appoint a successor trustee or
trustees by written instrument, in duplicate, one copy of which instrument shall
be delivered to the resigning Trustee and one copy to the successor trustee. If
no successor trustee shall have been so appointed and have accepted appointment
within 60 days after the mailing of such notice of resignation to the affected
Securityholders, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee, or any Securityholder
who has been a bona fide holder of a Security for at least six months may,
subject to the provisions of Section 5.09, on behalf of himself and all others
similarly situated, petition any such court for the appointment of a successor
trustee. Such court may thereupon, after such notice, if any, as it may deem
proper and prescribe, appoint a successor trustee.

          (b) In case at any time any of the following shall occur:

               (i) the Trustee shall fail to comply with the provisions of
Section 6.08 after written request therefor by the Company or by any
Securityholder who has been a bona fide holder of a Security or Securities for
at least six months, or

               (ii) the Trustee shall cease to be eligible in accordance with
the provisions of Section 6.09 and shall fail to resign after written request
therefor by the Company or by any such Securityholder, or

               (iii) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its
property shall be appointed, or any public officer shall take charge or control
of the Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then, in any such case, the Company may remove the
Trustee and appoint a successor trustee by written instrument, in duplicate, one
copy of which instrument shall be delivered to the Trustee so removed and one
copy to the successor trustee, or, subject to the provisions of Section 5.09,
any Securityholder who has been a bona fide holder of a Security for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor trustee. Such court may thereupon, after such notice,
if any, as it may deem proper, remove the Trustee and appoint a successor
trustee.

                                      -35-
<PAGE>

          (c) The holders of a majority in aggregate principal amount of the
Securities at the time outstanding may at any time remove the Trustee and
nominate a successor trustee, which shall be deemed appointed as successor
trustee unless within 10 days after such nomination the Company objects thereto
or if no successor trustee shall have been so appointed and shall have accepted
appointment within 30 days after such removal, in which case the Trustee so
removed or any Securityholder, upon the terms and conditions and otherwise as in
subsection (a) of this Section 6.10 provided, may petition any court of
competent jurisdiction for an appointment of a successor trustee.

          (d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section 6.10 shall
become effective only upon acceptance of appointment by the successor trustee as
provided in Section 6.11.

SECTION 6.11  Acceptance by Successor Trustee.

          Any successor trustee appointed as provided in Section 6.10 shall
execute, acknowledge and deliver to the Company and to its predecessor trustee
an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the retiring trustee shall become effective and such
successor trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, duties and obligations of its predecessor
hereunder, with like effect as if originally named as trustee herein; but,
nevertheless, on the written request of the Company or of the successor trustee,
the trustee ceasing to act shall, upon payment of any amounts then due it
pursuant to the provisions of Section 6.06, execute and deliver an instrument
transferring to such successor trustee all the rights and powers of the trustee
so ceasing to act and shall duly assign, transfer and deliver to such successor
trustee all property and money held by such retiring trustee thereunder. Upon
request of any such successor trustee, the Company shall execute any and all
instruments in writing for more fully and certainly vesting in and confirming to
such successor trustee all such rights and powers. Any trustee ceasing to act
shall, nevertheless, retain a lien upon all property or funds held or collected
by such trustee to secure any amounts then due it pursuant to the provisions of
Section 6.06.

          No successor trustee shall accept appointment as provided in this
Section 6.11 unless at the time of such acceptance such successor trustee shall
be qualified under the provisions of Section 6.08 and eligible under the
provisions of Section 6.09.

          Upon acceptance of appointment by a successor trustee as provided in
this Section 6.11, the Company shall mail notice of the succession of such
trustee hereunder to the holders of Securities at their addresses as they shall
appear on the Security register. If the Company fails to mail such notice within
10 days after the acceptance of appointment by the successor trustee, the
successor trustee shall cause such notice to be mailed at the expense of the
Company.

SECTION 6.12  Succession by Merger, etc.

          Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder without
the execution or

                                      -36-
<PAGE>

filing of any paper or any further act on the part of any of the parties hereto
provided such corporations shall be otherwise qualified and eligible under this
Article.

          In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any Securities shall have been authenticated
but not delivered, any such successor to the Trustee may adopt the certificate
of authentication of any predecessor trustee, and deliver such Securities so
authenticated; and in case at that time any of the Securities shall not have
been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor hereunder or in the name of the
successor trustee; and in all such cases such certificates shall have the full
force which the Securities or this Indenture elsewhere provides that the
certificate of the Trustee shall have; provided, however, that the right to
adopt the certificate of authentication of any predecessor Trustee or
authenticate Securities in the name of any predecessor Trustee shall apply only
to its successor or successors by merger, conversion or consolidation.

SECTION 6.13  Limitation on Rights of Trustee as a Creditor.

          The Trustee shall comply with Section 311(a) of the Trust Indenture
Act. A Trustee who has resigned or been removed shall be subject to Section
311(a) of the Trust Indenture Act to the extent included therein.

SECTION 6.14  Authenticating Agents.

          There may be one or more Authenticating Agents appointed by the
Trustee upon the request of the Company with power to act on its behalf and
subject to its direction in the authentication and delivery of Securities issued
upon exchange or transfer thereof as fully to all intents and purposes as though
any such Authenticating Agent had been expressly authorized to authenticate and
deliver Securities; provided, that the Trustee shall have no liability to the
Company for any acts or omissions of the Authenticating Agent with respect to
the authentication and delivery of Securities. Any such Authenticating Agent
shall at all times be a corporation organized and doing business under the laws
of the United States or of any state or territory thereof or of the District of
Columbia authorized under such laws to act as Authenticating Agent, having a
combined capital and surplus of at least $50,000,000 and being subject to
supervision or examination by federal, state, territorial or District of
Columbia authority. If such corporation publishes reports of condition at least
annually pursuant to law or the requirements of such authority, then for the
purposes of this Section 6.14 the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect herein specified in this Section.

          Any corporation into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any Authenticating Agent
shall be a party, or any corporation succeeding to the corporate trust business
of any Authenticating Agent, shall be the successor of such Authenticating Agent
hereunder, if such successor corporation is otherwise eligible under this
Section 6.14 without the execution or filing of any paper or any further act on
the part of the parties hereto or such Authenticating Agent.

                                      -37-
<PAGE>

          Any Authenticating Agent may at any time resign by giving written
notice of resignation to the Trustee and to the Company. The Trustee may at any
time terminate the agency of any Authenticating Agent by giving written notice
of termination to such Authenticating Agent and to the Company. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
any Authenticating Agent shall cease to be eligible under this Section 6.14, the
Trustee may, and upon the request of the Company shall, promptly appoint a
successor Authenticating Agent eligible under this Section 6.14, shall give
written notice of such appointment to the Company and shall mail notice of such
appointment to all Securityholders as the names and addresses of such holders
appear on the Security Register. Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with all rights,
powers, duties and responsibilities of its predecessor hereunder, with like
effect as if originally named as Authenticating Agent herein.

          The Company, as borrower, agrees to pay to any Authenticating Agent
from time to time reasonable compensation for its services. Any Authenticating
Agent shall have no responsibility or liability for any action taken by it as
such in accordance with the directions of the Trustee.

                                   ARTICLE VII
                         CONCERNING THE SECURITYHOLDERS

SECTION 7.01  Action by Securityholders.

          Whenever in this Indenture it is provided that the holders of a
specified percentage in aggregate principal amount of the Securities may take
any action (including the making of any demand or request, the giving of any
notice, consent or waiver or the taking of any other action) the fact that at
the time of taking any such action the holders of such specified percentage have
joined therein may be evidenced by any instrument or any number of instruments
of similar tenor executed by such Securityholders in person or by agent or proxy
appointed in writing.

          If the Company shall solicit from the Securityholders any request,
demand, authorization, direction, notice, consent, waiver or other action, the
Company may, at its option, as evidenced by an Officers' Certificate, fix in
advance a record date for the determination of Securityholders entitled to give
such request, demand, authorization, direction, notice, consent, waiver or other
action, 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 action may be given before or after the record date, but only
the Securityholders of record at the close of business on the record date shall
be deemed to be Securityholders for the purposes of determining whether
Securityholders of the requisite proportion of outstanding Securities have
authorized or agreed or consented to such request, demand, authorization,
direction, notice, consent, waiver or other action, and for that purpose the
outstanding Securities shall be computed as of the record date; provided,
however, that no such authorization, agreement or consent by such
Securityholders on the 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.

                                      -38-
<PAGE>

SECTION 7.02  Proof of Execution by Securityholders.

          Subject to the provisions of Section 6.01 and 6.02, proof of the
execution of any instrument by a Securityholder or his agent or proxy shall be
sufficient if made in accordance with such reasonable rules and regulations as
may be prescribed by the Trustee or in such manner as shall be satisfactory to
the Trustee. The ownership of Securities shall be proved by the Security
Register or by a certificate of the Security Registrar. The Trustee may require
such additional proof of any matter referred to in this Section as it shall deem
necessary.

SECTION 7.03  Who Are Deemed Absolute Owners.

          Prior to due presentment for registration of transfer of any Security,
the Company, the Trustee, any Authenticating Agent, any paying agent, any
transfer agent and any Security Registrar may deem the person in whose name such
Security shall be registered upon the Security Register to be, and may treat him
as, the absolute owner of such Security (whether or not such Security shall be
overdue) for the purpose of receiving payment of or on account of the principal
of and premium, if any, and (subject to Section 2.05) interest on such Security
and for all other purposes; and neither the Company nor the Trustee nor any
Authenticating Agent nor any paying agent nor any transfer agent nor any
Security Registrar shall be affected by any notice to the contrary. All such
payments so made to any holder for the time being or upon his order shall be
valid, and, to the extent of the sum or sums so paid, effectual to satisfy and
discharge the liability for moneys payable upon any such Security.

SECTION 7.04  Securities Owned by Company Deemed Not Outstanding.

          In determining whether the holders of the requisite aggregate
principal amount of Securities have concurred in any direction, consent, notice
or waiver under this Indenture, Securities which are owned by the Company or any
other obligor on the Securities or any Affiliate of the Company (other than the
Trust) or any other obligor on the Securities shall be disregarded and deemed
not to be outstanding for the purpose of any such determination; provided that
for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, consent or waiver, only Securities which a
Responsible Officer of the Trustee actually knows are so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as outstanding for the purposes of this Section 7.04 if the pledgee
shall establish to the satisfaction of the Trustee the pledgee's right to vote
such Securities and that the pledgee is not the Company or any such other
obligor or Affiliate of the Company or any such other obligor. In the case of a
dispute as to such right, any decision by the Trustee taken upon the advice of
counsel shall be full protection to the Trustee.

SECTION 7.05  Revocation of Consents; Future Holders Bound.

          At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 7.01, of the taking of any action by the holders of the
percentage in aggregate principal amount of the Securities specified in this
Indenture in connection with such action, any holder of a Security (or any
Security issued in whole or in part in exchange or substitution therefor),
subject to Section 7.01, the serial number of which is shown by the evidence to
be included in the Securities the holders of which

                                      -39-
<PAGE>

have consented to such action may, by filing written notice with the Trustee at
its principal office and upon proof of holding as provided in Section 7.02,
revoke such action so far as concerns such Security (or so far as concerns the
principal amount represented by any exchanged or substituted Security). Except
as aforesaid any such action taken by the holder of any Security shall be
conclusive and binding upon such holder and upon all future holders and owners
of such Security, and of any Security issued in exchange or substitution
therefor, irrespective of whether or not any notation in regard thereto is made
upon such Security or any Security issued in exchange or substitution therefor.

                                  ARTICLE VIII
                CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE

SECTION 8.01  Company May Consolidate, etc., on Certain Terms.

          Nothing contained in this Indenture or in any of the Securities shall
prevent any consolidation or merger of the Company with or into any other Person
(whether or not affiliated with the Company, as the case may be), or successive
consolidations or mergers in which the Company or its successor or successors,
as the case may be, shall be a party or parties, or shall prevent any sale,
conveyance, transfer or lease of the property of the Company, or its successor
or successors as the case may be, as an entirety, or substantially as an
entirety, to any other Person (whether or not affiliated with the Company, or
its successor or successors, as the case may be) authorized to acquire and
operate the same; provided, that (a) the Company is the surviving Person, or the
Person formed by or surviving any such consolidation or merger (if other than
the Company) or to which such sale, conveyance, transfer or lease of property is
made is a Person organized and existing under the laws of the United States or
any State thereof or the District of Columbia, and (b) upon any such
consolidation, merger, sale, conveyance, transfer or lease, the due and punctual
payment of the principal of (and premium, if any) and interest on the Securities
according to their tenor and the due and punctual performance and observance of
all the covenants and conditions of this Indenture to be kept or performed by
the Company shall be expressly assumed, by supplemental indenture (which shall
conform to the provisions of the Trust Indenture Act, as then in effect)
satisfactory in form to the Trustee executed and delivered to the Trustee by the
Person formed by such consolidation, or into which the Company shall have been
merged, or by the Person which shall have acquired such property, as the case
may be[, which supplemental indenture shall provide for conversion rights in
accordance with Article XIII] and (c) after giving effect to such consolidation,
merger, sale, conveyance, transfer or lease, no Default or Event of Default
shall have occurred and be continuing.

SECTION 8.02  Successor Corporation to be Substituted for Company.

          In case of any such consolidation, merger, sale, conveyance, transfer
or lease and upon the assumption by the successor corporation, by supplemental
indenture, executed and delivered to the Trustee and satisfactory in form to the
Trustee, of the due and punctual payment of the principal of and premium, if
any, and interest (including any Additional Sums or Compounded Interest) on all
of the Securities and the due and punctual performance and observance of all of
the covenants and conditions of this Indenture to be performed or observed by
the Company, such successor Person shall succeed to and be substituted for the
Company, with the same effect as if it had been named herein as the party of the
first part, and the Company thereupon shall be relieved of any further liability
or obligation hereunder or upon the Securities. Such successor Person thereupon
may cause

                                      -40-
<PAGE>

to be signed, and may issue either in its own name or in the name of Dynegy Inc.
any or all of the Securities issuable hereunder which theretofore shall not have
been signed by the Company and delivered to the Trustee or the Authenticating
Agent; and, upon the order of such successor Person instead of the Company and
subject to all the terms, conditions and limitations in this Indenture
prescribed, the Trustee or the Authenticating Agent shall authenticate and
deliver any Securities which previously shall have been signed and delivered by
the officers of the Company to the Trustee or the Authenticating Agent for
authentication, and any Securities which such successor Person thereafter shall
cause to be signed and delivered to the Trustee or the Authenticating Agent for
that purpose. All the Securities so issued shall in all respects have the same
legal rank and benefit under this Indenture as the Securities theretofore or
thereafter issued in accordance with the terms of this Indenture as though all
of such Indentures had been issued at the date of the execution hereof.

SECTION 8.03  Opinion of Counsel to be Given Trustee.

          The Trustee, subject to the provisions of Sections 6.01 and 6.02, may
receive an Opinion of Counsel as conclusive evidence that any consolidation,
merger, sale, conveyance, transfer or lease, and any assumption, permitted or
required by the terms of this Article VIII complies with the provisions of this
Article VIII.

                                   ARTICLE IX
                             SUPPLEMENTAL INDENTURES

SECTION 9.01  Without Consent of Securityholders.

          The Company, when authorized by a Board Resolution, and the Trustee
may from time to time and at any time enter into one or more indentures
supplemental hereto, in form satisfactory to the Trustee, without the consent of
the Securityholders, for one or more of the following purposes:

          (a) to evidence the succession of another Person to the Company, or
successive successions, and the assumption by the successor Person of the
covenants, agreements and obligations of the Company herein and in the
Securities pursuant to Article VIII hereof;

          (b) to add to the covenants of the Company such further covenants,
restrictions or conditions for the protection of the Securityholders as the
Board of Directors and the Trustee shall consider to be for the protection of
the Securityholders, and to make the occurrence, or the occurrence and
continuance, of a default in any of such additional covenants, restrictions or
conditions a default or an Event of Default permitting the enforcement of all or
any of the remedies provided in this Indenture as herein set forth; provided,
however, that in respect of any such additional covenant, restriction or
condition such amendment may provide for a particular period of grace after
default (which period may be shorter or longer than that allowed in the case of
other defaults) or may provide for an immediate enforcement upon such default or
may limit the remedies available to the Trustee upon such default;

          (c) to provide for the issuance under this Indenture of Securities in
coupon form (including Securities registrable as to principal only) and to
provide for exchangeability of such

                                      -41-
<PAGE>

Securities with the Securities issued hereunder in fully registered form and to
make all appropriate changes for such purpose;

          (d) to cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be defective or
inconsistent with any other provision contained herein or in any supplemental
indenture, or to make such other provisions in regard to matters or questions
arising under this Indenture; provided that any such action shall not materially
adversely affect the interests of the holders of the Securities;

          (e) to evidence and provide for the acceptance of appointment
hereunder by a successor trustee with respect to the Securities;

          (f) to make provision for transfer procedures, certification, book-
entry provisions, the form of restricted securities legends, if any, to be
placed on Securities, and all other matters required pursuant to Section 2.06 or
otherwise necessary, desirable or appropriate in connection with the issuance of
Securities to holders of Preferred Securities in the event of a distribution of
Securities by the Trust following a Dissolution Event;

          (g) to qualify or maintain qualification of this Indenture under the
Trust Indenture Act[; or

          (h) to make provision with respect to the conversion of Securities
pursuant to the requirements of Article XIII].

          The Trustee is hereby authorized to join with the Company in the
execution of any supplemental indenture to effect such amendment, to make any
further appropriate agreements and stipulations which may be therein contained
and to accept the conveyance, transfer and assignment of any property
thereunder, but the Trustee shall not be obligated to, but may in its
discretion, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.

          Any amendment to the Indenture authorized by the provisions of this
Section 9.01 may be executed by the Company and the Trustee without the consent
of the holders of any of the Securities at the time outstanding, notwithstanding
any of the provisions of Section 9.02.

SECTION 9.02  With Consent of Securityholders.

          With the consent (evidenced as provided in Section 7.01) of the
holders of a majority in aggregate principal amount of the Securities at the
time outstanding, the Company, when authorized by a Board Resolution, and the
Trustee may from time to time and at any time enter into an indenture or
indentures supplemental hereto for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture or
of modifying in any manner the rights of the holders of the Securities;
provided, however, that no such amendment shall without the consent of the
holders of each Security then outstanding and affected thereby (i) change the
Maturity Date of any Security, or reduce the rate of interest (including
Compounded Interest) or extend the time of payment of interest thereon (except
as contemplated by Section 2.13), or reduce the principal

                                      -42-
<PAGE>

amount thereof or the amount of premium thereon, if any, or reduce any amount
payable on redemption thereof, or make the principal thereof or any interest or
premium thereon payable in any coin or currency other than that provided in the
Securities, or impair or affect the right of any Securityholder to institute
suit for payment thereof [or adversely affect the right to convert such Security
as provided in Article XIII], (ii) modify the provisions of this Indenture with
respect to the subordination of the Securities in a manner adverse to the
holders of Securities, (iii) reduce the aforesaid percentage of Securities the
holders of which are required to consent to any such amendment to the Indenture,
or the consent of whose holders is required for any waiver (of compliance with
certain provisions of this Indenture or certain defaults hereunder and their
consequences) provided for in this Indenture or (iv) modify any of the
provisions of the first paragraph of this Section 9.02, or the second sentence
of Section 5.07, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived without
the consent of the holder of each outstanding Security affected thereby;
provided, however, that if the Securities are held by the Trust, such amendment
shall not be effective until the holders of a majority in liquidation amount of
Trust Securities shall have consented to such amendment; provided, further, that
if the consent of the holder of each outstanding Security is required, such
amendment shall not be effective until each holder of the Trust Securities shall
have consented to such amendment.

          Upon the request of the Company accompanied by a copy of a resolution
of the Board of Directors certified by its Secretary or Assistant Secretary
authorizing the execution of any supplemental indenture affecting such
amendment, and upon the filing with the Trustee of evidence of the consent of
Securityholders as aforesaid, the Trustee shall join with the Company in the
execution of such supplemental indenture unless such supplemental indenture
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such supplemental indenture.

          Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Trustee
shall transmit by mail, first class postage prepaid, a notice, prepared by the
Company, setting forth in general terms the substance of such supplemental
indenture, to the Securityholders as their names and addresses appear upon the
Security Register. Any failure of the Trustee to mail such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of any
such supplemental indenture.

          It shall not be necessary for the consent of the Securityholders under
this Section 9.02 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.

SECTION 9.03  Compliance with Trust Indenture Act; Effect of Supplemental
              Indentures.

          Any supplemental indenture executed pursuant to the provisions of this
Article IX shall comply with the Trust Indenture Act. Upon the execution of any
supplemental indenture pursuant to the provisions of this Article IX, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitations of rights, obligations, duties
and immunities under this Indenture of the Trustee, the Company and the holders
of Securities shall thereafter be determined, exercised and enforced hereunder
subject in all respects to such

                                      -43-
<PAGE>

modifications and amendments and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.

SECTION 9.04  Notation on Securities.

          Securities authenticated and delivered after the execution of any
supplemental indenture affecting such series pursuant to the provisions of this
Article IX may bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company or the Trustee shall
so determine, new Securities so modified as to conform, in the opinion of the
Trustee and the Board of Directors, to any modification of this Indenture
contained in any such supplemental indenture may be prepared and executed by the
Company, authenticated by the Trustee or the Authenticating Agent and delivered
in exchange for the Securities then outstanding.

SECTION 9.05  Evidence of Compliance of Supplemental Indenture to be Furnished
              Trustee.

          The Trustee, subject to the provisions of Sections 6.01 and 6.02, may
receive, in addition to the document required by Section 1.07, an Officers'
Certificate and an Opinion of Counsel as conclusive evidence that any
supplemental indenture executed pursuant hereto complies with the requirements
of this Article IX.

                                    ARTICLE X
                                   REDEMPTION

SECTION 10.01     Special Event Redemption.

      [If, at any time, a Special Event has occurred and is  continuing  then,
notwithstanding  Section 10.02(a),  the  Company  shall have the right but not
the  obligation,  at any time within 90 days  following the occurrence of such
Special  Event,  upon (i) not less than 45 days' written notice to the Trustee
and (ii) not less than 30 days' nor more than 60 days'  written  notice to the
Securityholders,  to redeem the Securities, in whole (but not in part), at the
Special Event  Redemption  Price.  Following a Special  Event,  if the Company
wishes to exercise its right of  redemption  pursuant to this  Section  10.01,
the Company  shall take such action as is necessary to promptly  determine the
Special  Event  Redemption  Price,  including  __________.  The Company  shall
provide the Trustee with written notice of the Special Event  Redemption Price
promptly   after  the   calculation   thereof,   which  notice  shall  include
__________.  The Special Event  Redemption  Price shall be paid prior to 12:00
noon, New York City time, on the date of such  redemption or such earlier time
as the Company  determines,  provided  that the Company shall deposit with the
Trustee an amount  sufficient  to pay the Special  Event  Redemption  Price by
10:00 a.m.,  New York City time,  on the date such  Special  Event  Redemption
Price is to be paid.]

SECTION 10.02  Optional Redemption by Company.

          [Subject to the provisions of this Article X, the Company shall have
the right to redeem the Securities, in whole or in part, from time to time, at a
redemption price equal to the Optional Redemption Price.

                                      -44-
<PAGE>

          If the Securities are only partially redeemed pursuant to this Section
10.02, the Securities to be redeemed shall be selected on a pro rata basis not
more than 60 days prior to the date fixed for redemption from the outstanding
Securities not previously called for redemption; provided that any such
proration may be made on the basis of the aggregate principal amount of
Securities held by each Securityholder and may be made by making such
adjustments as the Company deems fair and appropriate in order that only
Securities in denominations of [$__________] or integral multiples thereof shall
be redeemed. The Optional Redemption Price shall be paid prior to 12:00 noon,
New York City time, on the date of such redemption or at such earlier time as
the Company determines; provided that the Company shall deposit with the Trustee
an amount sufficient to pay the Optional Redemption Price by 10:00 a.m., New
York City time, on the date such Optional Redemption Price is to be paid.]

SECTION 10.03  No Sinking Fund.

          The Securities are not entitled to the benefit of any sinking fund.

SECTION 10.04  Notice of Redemption; Selection of Securities.

          In case the Company shall desire to exercise the right to redeem all,
or, as the case may be, any part of the Securities in accordance with their
terms, it shall fix a date for redemption and shall mail a notice of such
redemption at least 30 and not more than 60 days prior to the date fixed for
redemption to the holders of Securities so to be redeemed as a whole or in part
at their last addresses as the same appear on the Security Register. Such
mailing shall be by first class mail. The notice if mailed in the manner herein
provided shall be conclusively presumed to have been duly given, whether or not
the holder receives such notice. In any case, failure to give such notice by
mail or any defect in the notice to the holder of any Security designated for
redemption as a whole or in part shall not affect the validity of the
proceedings for the redemption of any other Security.

          Each such notice of redemption shall specify the CUSIP number of the
Securities to be redeemed, the date fixed for redemption, the redemption price
at which the Securities are to be redeemed (or the method by which such
redemption price is to be calculated), the place or places of payment that
payment will be made upon presentation and surrender of the Securities, that
interest accrued to the date fixed for redemption will be paid as specified in
said notice, [the date on which the right to convert the Securities to be
redeemed will terminate and the places where such Securities may be surrendered
for conversion] and that on and after said date interest thereon or on the
portions thereof to be redeemed will cease to accrue. If less than all the
Securities are to be redeemed the notice of redemption shall specify the numbers
of the Securities to be redeemed. In case any Security is to be redeemed in part
only, the notice of redemption shall state the portion of the principal amount
thereof to be redeemed and shall state that on and after the date fixed for
redemption, upon surrender of such Security, a new Security or Securities in
principal amount equal to the unredeemed portion thereof will be issued.

          The Company will give the Trustee notice not less than 45 days prior
to the redemption date as to the aggregate principal amount of Securities to be
redeemed and the Trustee shall select, in such manner as in its sole discretion
it shall deem appropriate and fair, the Securities or portions thereof

                                      -45-
<PAGE>

(in integral multiples of [$__________], except as otherwise set forth in the
applicable form of Security) to be redeemed.

SECTION 10.05  Payment of Securities Called for Redemption.

          By 12:00 noon New York City time on the redemption date specified in
the notice of redemption given as provided in this Section, the Company will
deposit with the Trustee or with one or more paying agents an amount of money
sufficient to redeem on the redemption date all the Securities so called for
redemption at the appropriate Redemption Price, together with accrued interest
to the date fixed for redemption.

          [If any Security called for redemption is converted, any money
deposited with the Trustee or with any paying agent or so segregated and held in
trust for the redemption of such Security shall be paid to the Company upon
Company Request or, if then held by the Company, shall be discharged from such
trust.]

          If notice of redemption has been given as provided in Section 10.04,
the Securities or portions of Securities with respect to which such notice has
been given shall become due and payable on the date and at the place or places
stated in such notice at the applicable Redemption Price, together with interest
accrued to the date fixed for redemption (subject to the rights of holders of
Securities on the close of business on a regular record date in respect of an
Interest Payment Date occurring on or prior to the redemption date), and on and
after said date (unless the Company shall default in the payment of such
Securities at the Redemption Price, together with interest accrued to said date)
interest (including Compounded Interest and Additional Sums, if any) on the
Securities or portions of Securities so called for redemption shall cease to
accrue. On presentation and surrender of such Securities at a place of payment
specified in said notice, the said Securities or the specified portions thereof
shall be paid and redeemed by the Company at the applicable Redemption Price,
together with interest (including Compounded Interest and Additional Sums, if
any) accrued thereon to the date fixed for redemption (subject to the rights of
holders of Securities on the close of business on a regular record date in
respect of an Interest Payment Date occurring on or prior to the redemption
date).

          Upon presentation of any Security redeemed in part only, the Company
shall execute and the Trustee shall authenticate and make available for delivery
to the holder thereof, at the expense of the Company, a new Security or
Securities of authorized denominations, in principal amount equal to the
unredeemed portion of the Security so presented.

                                   ARTICLE XI
                     SATISFACTION AND DISCHARGE OF INDENTURE

SECTION 11.01  Discharge of Indenture.

          When (a) the Company shall deliver to the Trustee for cancellation all
Securities theretofore authenticated (other than any Securities which shall have
been destroyed, lost or stolen and which shall have been replaced as provided in
Section 2.07) and not theretofore canceled, or (b) all the Securities not
theretofore canceled or delivered to the Trustee for cancellation shall have
become due

                                      -46-
<PAGE>

and payable, or are by their terms to become due and payable within one year or
are to be called for redemption within one year under arrangements satisfactory
to the Trustee for the giving of notice of redemption, and the Company shall
deposit with the Trustee, in trust, funds sufficient to pay on the Maturity Date
or upon redemption all of the Securities (other than any Securities which shall
have been destroyed, lost or stolen and which shall have been replaced as
provided in Section 2.07) not theretofore canceled or delivered to the Trustee
for cancellation, including principal and premium, if any, and interest
(including Compounded Interest and Additional Sums, if any) due or to become due
to the Maturity Date or redemption date, as the case may be, but excluding,
however, the amount of any moneys for the payment of principal of or premium, if
any, or interest (including Compounded Interest and Additional Sums, if any) on
the Securities (1) theretofore repaid to the Company in accordance with the
provisions of Section 11.04, or (2) paid to any State or to the District of
Columbia pursuant to its unclaimed property or similar laws, and if in either
case the Company shall also pay or cause to be paid all other sums payable
hereunder by the Company, then this Indenture shall cease to be of further
effect except for the provisions of Sections 2.02, 2.06, 2.07, 6.10, 11.04 [and
Article XIII] hereof, which shall survive until such Securities shall mature and
be paid [or are converted]. Thereafter, Sections 6.10 and 11.04 shall survive,
and the Trustee, on demand of the Company accompanied by any Officers'
Certificate and an Opinion of Counsel and at the cost and expense of the
Company, shall execute proper instruments acknowledging satisfaction of and
discharging this Indenture, the Company, however, hereby agreeing to reimburse
the Trustee for any costs or expenses thereafter reasonably and properly
incurred by the Trustee in connection with this Indenture or the Securities.

SECTION 11.02  Deposited Moneys to be Held in Trust by Trustee.

          Subject to the provisions of Section 11.04, all moneys deposited with
the Trustee pursuant to Sections 11.01 shall be held in trust and applied by it
to the payment, either directly or through any paying agent (including the
Company if acting as its own paying agent), to the holders of the particular
Securities for the payment of which such moneys have been deposited with the
Trustee, of all sums due and to become due thereon for principal, premium, if
any, and interest.

SECTION 11.03  Paying Agent to Repay Moneys Held.

          Upon the satisfaction and discharge of this Indenture all moneys then
held by any paying agent of the Securities (other than the Trustee) shall, upon
written demand of the Company, be repaid to it or paid to the Trustee, and
thereupon such paying agent shall be released from all further liability with
respect to such moneys.

SECTION 11.04  Return of Unclaimed Moneys.

          Any moneys deposited with or paid to the Trustee or any paying agent
for payment of the principal of or premium, if any, or interest on Securities
and not applied but remaining unclaimed by the holders of Securities for two
years after the date upon which the principal of or premium, if any, or interest
(including Compounded Interest and Additional Sums, if any) on such Securities,
as the case may be, shall have become due and payable, shall be repaid to the
Company by the Trustee or such paying agent on written demand; and the holder of
any of the Securities shall thereafter look only to the Company for any payment
which such holder may be entitled to collect and all liability of

                                      -47-
<PAGE>

the Trustee or such paying agent with respect to such moneys shall thereupon
cease. [All moneys deposited with the Trustee pursuant to Section 11.01 (and
held by it or any paying agent) for the payment of Securities subsequently
converted shall be returned to the Company upon Company Request.]

                                   ARTICLE XII
                                  SUBORDINATION

SECTION 12.01  Agreement to Subordinate.

          The Company covenants and agrees, and each holder of Securities issued
hereunder likewise covenants and agrees, that the Securities shall be issued
subject to the provisions of this Article XII; and each holder of a Security,
whether upon original issue or upon transfer or assignment thereof, accepts and
agrees to be bound by such provisions.

          The payment by the Company of the principal of, premium, if any, and
interest (including Compounded Interest and Additional Sums, if any) on all
Securities issued hereunder shall, to the extent and in the manner hereinafter
set forth, be subordinated and junior in right of payment to all Senior
Indebtedness, whether outstanding at the date of this Indenture or thereafter
incurred.

          No provision of this Article XII shall prevent the occurrence of any
Default or Event of Default hereunder.

SECTION 12.02  Default on Senior Indebtedness.

          In the event and during the continuation of any default by the Company
in the payment of principal, premium, interest or any other payment due on any
Senior Indebtedness, or in the event that the maturity of any Senior
Indebtedness has been accelerated because of a default, then, in either case, no
payment shall be made by the Company with respect to the principal (including
redemption payments) of or premium, if any, or interest on the Securities until
such default shall have been cured or waived in writing or shall have ceased to
exist or such Senior Indebtedness shall have been discharged or paid in full.

          In the event that, notwithstanding the foregoing, any payment shall be
received by the Trustee or any Securityholder when such payment is prohibited by
the preceding paragraphs of this Section 12.02, such payment shall be held in
trust for the benefit of, and shall be paid over or delivered to, the holders of
Senior Indebtedness or their respective representatives, or to the trustee or
trustees under any indenture pursuant to which any of such Senior Indebtedness
may have been issued, as their respective interests may appear.

SECTION 12.03  Liquidation; Dissolution; Bankruptcy.

          Upon any payment by the Company or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
creditors upon any dissolution or winding-up or liquidation or reorganization of
the Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all Senior Indebtedness of the Company shall
first be paid in full, or payment thereof provided for in money in accordance
with its terms, before any

                                      -48-
<PAGE>

payment is made by the Company on account of the principal (and premium, if any)
or interest (including Compounded Interest and Additional Sums, if any) on the
Securities; and upon any such dissolution or winding-up or liquidation or
reorganization, any payment by the Company, or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
which the Securityholders or the Trustee would be entitled to receive from the
Company, except for the provisions of this Article XII, shall be paid by the
Company or by any receiver, trustee in bankruptcy, liquidating trustee, agent or
other Person making such payment or distribution, or by the Securityholders or
by the Trustee under the Indenture if received by them or it, directly to the
holders of Senior Indebtedness of the Company (pro rata to such holders on the
basis of the respective amounts of Senior Indebtedness held by such holders, as
calculated by the Company) or their representative or representatives, or to the
trustee or trustees under any indenture pursuant to which any instruments
evidencing such Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay all such Senior
Indebtedness in full, in money in accordance with its terms, after giving effect
to any concurrent payment or distribution to or for the holders of such Senior
Indebtedness, before any payment or distribution is made to the Securityholders
or to the Trustee.

          In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, prohibited by the foregoing, shall be received by the
Trustee or any Securityholder before all Senior Indebtedness is paid in full, or
provision is made for such payment in money in accordance with its terms, such
payment or distribution shall be held in trust for the benefit of and shall be
paid over or delivered to the holders of such Senior Indebtedness or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing such Senior Indebtedness
may have been issued, as their respective interests may appear, as calculated by
the Company, for application to the payment of all Senior Indebtedness remaining
unpaid to the extent necessary to pay all such Senior Indebtedness in full in
money in accordance with its terms, after giving effect to any concurrent
payment or distribution to or for the benefit of the holders of such Senior
Indebtedness.

          For purposes of this Article XII only, the words "assets of the
Company of any kind or character, whether cash, property or securities" shall
not be deemed to include shares of stock of the Company as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment, the payment of which is
subordinated at least to the extent provided in this Article XII with respect to
the Securities to the payment of Senior Indebtedness that may at the time be
outstanding; provided that (i) such Senior Indebtedness is assumed by the new
corporation, if any, resulting from any such reorganization or readjustment, and
(ii) the rights of the holders of such Senior Indebtedness are not, without the
consent of such holders, altered by such reorganization or readjustment. The
consolidation of the Company with, or the merger of the Company into, another
Person or the liquidation or dissolution of the Company following the sale,
conveyance, transfer or lease of its property as an entirety, or substantially
as an entirety, to another Person upon the terms and conditions provided for in
Article VIII of this Indenture shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section 12.03 if such
other Person shall, as a part of such consolidation, merger, sale, conveyance,
transfer or lease, comply with the conditions stated in Article VIII of this

                                      -49-
<PAGE>

Indenture. Nothing in Section 12.02 or in this Section 12.03 shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 6.06 of this
Indenture.

          Nothing contained in this Article XII or elsewhere in this Indenture
or in the Securities is intended to or shall impair, as between the Company, its
creditors other than the holders of Senior Indebtedness of the Company, and the
holders of the Securities, the obligation of the Company, which is absolute and
unconditional, to pay to the holders of the Securities the principal of (and
premium, if any) and interest (including Compounded Interest and Additional
Sums, if any) on the Securities as and when the same shall become due and
payable in accordance with their terms, or is intended to or shall affect the
relative rights of the holders of the Securities and creditors of the Company,
as the case may be, other than the holders of Senior Indebtedness of the
Company, as the case may be, nor shall anything herein or therein prevent the
occurrence of an Event of Default under Article V or prevent the Trustee or the
holder of any Security from exercising all remedies otherwise permitted by
applicable law upon the occurrence of a Default or an Event of Default under the
Indenture, subject to the rights, if any, under this Article XII of the holders
of such Senior Indebtedness in respect of cash, property or securities of the
Company, as the case may be, received upon the exercise of any such remedy.

SECTION 12.04  Subrogation.

          Subject to the payment in full of all Senior Indebtedness, the rights
of the Securityholders shall be subrogated to the rights of the holders of such
Senior Indebtedness to receive payments or distributions of cash, property or
securities of the Company, as the case may be, applicable to such Senior
Indebtedness until the principal of (and premium, if any) and interest on the
Securities shall be paid in full; and, for the purposes of such subrogation, no
payments or distributions to the holders of such Senior Indebtedness of any
cash, property or securities to which the Securityholders or the Trustee would
be entitled except for the provisions of this Article XII, and no payment over
pursuant to the provisions of this Article XII to or for the benefit of the
holders of such Senior Indebtedness by Securityholders or the Trustee, shall, as
between the Company, its creditors other than holders of Senior Indebtedness of
the Company, and the holders of the Securities, be deemed to be a payment by the
Company to or on account of such Senior Indebtedness. It is understood that the
provisions of this Article XII are and are intended solely for the purposes of
defining the relative rights of the holders of the Securities, on the one hand,
and the holders of such Senior Indebtedness on the other hand.

SECTION 12.05  Trustee to Effectuate Subordination.

          Each Securityholder by such Securityholder's acceptance thereof
authorizes and directs the Trustee on such Securityholder's behalf to take such
action as may be necessary or appropriate to effectuate the subordination
provided in this Article XII and appoints the Trustee such Securityholder's
attorney-in-fact for any and all such purposes.

SECTION 12.06  Notice by the Company.

          The Company shall give prompt written notice to a Responsible Officer
of the Trustee of any fact known to the Company that would prohibit the making
of any payment of monies to or by the

                                      -50-
<PAGE>

Trustee in respect of the Securities pursuant to the provisions of this Article
XII. Notwithstanding the provisions of this Article XII or any other provision
of this Indenture, the Trustee shall not be charged with knowledge of the
existence of any facts that would prohibit the making of any payment of monies
to or by the Trustee in respect of the Securities pursuant to the provisions of
this Article XII, unless and until a Responsible Officer of the Trustee shall
have received written notice thereof from the Company or a holder or holders of
Senior Indebtedness or from any trustee therefor; and before the receipt of any
such written notice, the Trustee, subject to the provisions of Article VI of
this Indenture, shall be entitled in all respects to assume that no such facts
exist; provided, however, that if the Trustee shall not have received the notice
provided for in this Section 12.06 at least two Business Days prior to the date
upon which by the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of (or premium, if
any) or interest (including Compounded Interest and Additional Sums, if any) on
any Security, then, anything herein contained to the contrary notwithstanding,
the Trustee shall have full power and authority to receive such money and to
apply the same to the purposes for which they were received, and shall not be
affected by any notice to the contrary that may be received by it within two
Business Days prior to such date.

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

          Upon any payment or distribution of assets of the Company referred to
in this Article XII, the Trustee and the Securityholders shall be entitled to
rely upon any order or decree entered by any court of competent jurisdiction in
which such insolvency, bankruptcy, receivership, liquidation, reorganization,
dissolution, winding up or similar case or proceeding is pending, or a
certificate of the trustee in bankruptcy, liquidating trustee, custodian,
receiver, assignee for the benefit of creditors, agent or other person making
such payment or distribution, delivered to the Trustee or to the
Securityholders, for the purpose of ascertaining the persons entitled to
participate in such payment or distribution, the holders of 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 XII.

SECTION 12.07  Rights of the Trustee; Holders of Senior Indebtedness.

          The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article XII in respect of any Senior Indebtedness at
any time held by it, to the same extent as any other

                                      -51-
<PAGE>

holder of Senior Indebtedness, and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.

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

          Nothing in this Article XII shall apply to claims of, or payments to,
the Trustee under or pursuant to Section 6.06.

SECTION 12.08  Subordination May Not Be Impaired.

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

          Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Indebtedness of the Company may, at any time and from time
to time, without the consent of or notice to the Trustee or the Securityholders,
without incurring responsibility to the Securityholders and without impairing or
releasing the subordination provided in this Article XII or the obligations
hereunder of the holders of the Securities to the holders of such Senior
Indebtedness, do any one or more of the following: (i) change the manner, place
or terms of payment or extend the time of payment of, or renew or alter, such
Senior Indebtedness, or otherwise amend or supplement in any manner such Senior
Indebtedness or any instrument evidencing the same or any agreement under which
such Senior Indebtedness is outstanding; (ii) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing such
Senior Indebtedness; (iii) release any Person liable in any manner for the
collection of such Senior Indebtedness; and (iv) exercise or refrain from
exercising any rights against the Company, as the case may be, and any other
Person.

SECTION 12.09  Article Applicable to Paying Agents.

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

                                      -52-
<PAGE>

SECTION 12.10  Trust Moneys Not Subordinated.

          Notwithstanding anything contained herein to the contrary, payments
from money held in trust under Section 11.02 of this Indenture by the Trustee
for the payment of principal of and interest on the Securities shall not be
subordinated to the prior payment of any Senior Indebtedness or subject to the
restrictions set forth in this Article XII, and none of the Securityholders
shall be obligated to pay over any such amount to the Company or any holder of
Senior Indebtedness of the Company or any other creditor of the Company.

                                  ARTICLE XIII
                            [CONVERSION OF SECURITIES

SECTION 13.01  Conversion Rights.

          Subject to and upon compliance with the provisions of this Article,
the Securities are convertible, at the option of the holder, at any time prior
to 5:00 p.m. New York City time on the Business Day immediately preceding
_____________ into [a number of fully paid and nonassessable shares of Common
Stock equal to the $____ principal amount per Security divided by the initial
conversion price of $___ (the "Initial Conversion Price") (equal to an initial
conversion ratio of approximately _____shares of Common Stock for each $___ in
aggregate principal amount of Securities).] The conversion price in effect at
any given time is known as the "Applicable Conversion Price" and is subject to
adjustment as described in this Article XIII. A holder of Securities may convert
any portion of the principal amount of the Securities into that number of fully
paid and nonassessable shares of Common Stock (calculated as to each conversion
to the nearest 1/100th of a share) obtained by dividing the principal amount of
the Securities to be converted by the Applicable Conversion Price. In case a
Security or portion thereof is called for redemption, such conversion right in
respect of the Security or portion so called shall expire at the close of the
Business Day immediately preceding the corresponding Redemption Date, unless the
Company defaults in making the payment due upon redemption.

SECTION 13.02 Conversion Procedures.

          (a) In order to convert all or a portion of the Securities, the holder
thereof shall deliver to the Conversion Agent an irrevocable Notice of
Conversion setting forth the principal amount of Securities to be converted,
together with the name or names, if other than the holder, in which the shares
of Common Stock should be issued upon conversion and, if such Securities are
definitive Securities, surrender to the Conversion Agent the Securities to be
converted, duly endorsed or assigned to the Company or in blank. In addition, a
holder of Preferred Securities may exercise its right under the Declaration to
convert such Preferred Securities into Common Stock by delivering to the
Conversion Agent an irrevocable Notice of Conversion setting forth the
information called for by the preceding sentence and directing the Conversion
Agent (i) to exchange such Preferred Security for a portion of the Securities
held by the Trust (at an exchange rate of $____ principal amount of Securities
for each Preferred Security) and (ii) to immediately convert such Securities, on
behalf of such holder, into Common Stock of the Company pursuant to this Article
XIII and, if such Preferred Securities are in definitive form, surrendering such
Preferred Securities, duly endorsed or assigned to the Company or in blank. So
long as any Preferred Securities are outstanding, the Trust shall not

                                      -53-
<PAGE>

convert any Securities except pursuant to a Notice of Conversion duly executed
and delivered to the Conversion Agent by a holder of Preferred Securities.

          [If a Notice of Conversion is delivered on or after the regular record
date and prior to the subsequent Interest Payment Date, the holder will be
entitled to receive the interest payable on the subsequent Interest Payment Date
on the portion of Securities to be converted notwithstanding the conversion
thereof prior to such Interest Payment Date. Except as otherwise provided in the
immediately preceding sentence, in the case of any Security which is converted,
interest whose due date is after the date of conversion of such Security shall
not be payable, and the Company shall not make nor be required to make any other
payment, adjustment or allowance with respect to accrued but unpaid interest on
the Securities being converted, which shall be deemed to be paid in full.] Each
conversion shall be deemed to have been effected immediately prior to the close
of business on the day on which the Notice of Conversion was received (the
"Conversion Date") by the Conversion Agent from the holder or from a holder of
the Preferred Securities effecting a conversion thereof pursuant to its
conversion rights under the Declaration, as the case may be. The Person or
Persons entitled to receive the Common Stock issuable upon such conversion shall
be treated for all purposes as the record holder or holders of such Common Stock
as of the Conversion Date and such Person or Persons will cease to be a record
holder or record holders of the Securities on that date; provided, however, that
if the transfer books of the Common Stock shall be closed on said Conversion
Date, the Company shall not be required to issue any shares on such conversion
until the date on which such transfer books shall be reopened and such Person or
Persons shall not be deemed to have become the holder or holders of record of
such shares until the date on which such transfer books shall be reopened, but
such conversion shall nevertheless be effected when such transfer books shall be
reopened at the Conversion Price in effect on and otherwise as of the date on
which such Security shall have been surrendered to and such Notice of Conversion
received by the Company as aforesaid. As promptly as practicable on or after the
Conversion Date, the Company shall issue and deliver at the office of the
Conversion Agent, unless otherwise directed by the holder in the Notice of
Conversion, a certificate or certificates for the number of full shares of
Common Stock issuable upon such conversion, together with the cash payment, if
any, in lieu of any fraction of any share to the Person or Persons entitled to
receive the same. The Conversion Agent shall deliver such certificate or
certificates to such Person or Persons.

          (b) Subject to any right of the holder of such Security or any
Predecessor Security to receive interest as provided in Section 2.05(e) and the
second paragraph of clause (a) of Section 13.02, the Company's delivery upon
conversion of the whole number of shares of Common Stock into which the
Securities are convertible (together with the cash payment, if any, in lieu of
fractional shares) shall be deemed to satisfy the Company's obligation to pay
the principal amount at maturity of the portion of Securities so converted and
any unpaid interest (including Additional Payments) accrued on such Securities
at the time of such conversion.

          (c) No fractional shares of Common Stock will be issued as a result of
conversion, but in lieu thereof, the Company shall pay to the Conversion Agent a
cash adjustment in an amount equal to the same fraction of the Closing Price of
such fractional interest on the date on which the Securities or Preferred
Securities, as the case may be, were duly surrendered to the Conversion Agent
for conversion, or, if such day is not a Trading Day, on the next Trading Day,
and the Conversion Agent

                                      -54-
<PAGE>

in turn will make such payment, if any, to the holder of the Securities or the
holder of the Preferred Securities so converted.

          (d) In the event of the conversion of any Security in part only, a new
Security or Securities for the unconverted portion thereof will be issued in the
name of the holder thereof upon the cancellation thereof in accordance with
Section 3.06.

          (e) In effecting the conversion transactions described in this
Section, the Conversion Agent is acting as agent of the holders of Preferred
Securities (in the exchange of Preferred Securities for Securities) and as agent
of the holders of Securities (in the conversion of Securities into Common
Stock), as the case may be, directing it to effect such conversion transactions.
The Conversion Agent is hereby authorized (x) if the Trust exists, (i) to
exchange Securities held by or on behalf of the Trust from time to time for
Preferred Securities in connection with the conversion of such Preferred
Securities in accordance with this Article XIII and (ii) to convert all or a
portion of the Securities into Common Stock and thereupon to deliver such shares
of Common Stock in accordance with the provisions of this Article XIII and to
deliver to the Trust a new Security or Securities for any Securities held by the
holders and not converted in connection with the conversion of such Securities
in accordance with this Article XIII and (y) if the Trust has been dissolved and
the Securities have been distributed to the holders of the Preferred Securities,
to convert all or a portion of the Securities into Common Stock and thereupon to
deliver such shares of Common Stock in accordance with the provisions of this
Article XIII and to deliver to such holders a new Security or Securities for any
resulting unconverted principal amount.

SECTION 13.03  Conversion Price Adjustments.

          The Applicable Conversion Price shall be subject to adjustment
(without duplication) from time to time as follows ____________________.

SECTION 13.04  Reclassification, Consolidation, Merger or Sale of Assets.

          In the event that the Company shall be a party to any transaction
(including without limitation (a) any recapitalization or reclassification of
the Common Stock (other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a subdivision or
combination of the Common Stock), (b) any consolidation of the Company with, or
merger of the Company into, any other Person, any merger of another Person into
the Company (other than a merger which does not result in a reclassification,
conversion, exchange or cancellation of outstanding shares of Common Stock of
the Company), (c) any sale or transfer of all or substantially all of the assets
of the Company or (d) any compulsory share exchange) (each of the events in the
preceding clauses (a) through (d) being referred to as a "Company Transaction"),
in each case, as a result of which shares of Common Stock shall be converted
into the right to receive other securities, cash or other property, then lawful
provision shall be made as part of the terms of such Company Transaction whereby
the holder of each Security then outstanding shall have the right thereafter to
convert such Security only into the kind and amount of securities, cash and
other property receivable upon the consummation of the Company Transaction by a
holder of that number of shares of Common Stock into which such Security was
convertible immediately prior to such transaction.

                                      -55-
<PAGE>

Holders of the Securities shall have no voting rights with respect to any
Company Transaction described in this Section 13.04.

          The Company or the Person formed by such consolidation or resulting
from such merger or which acquired such assets or which acquires the Company's
shares, as the case may be, shall make provision in its certificate or articles
of incorporation or other constituent document to establish such right. Such
certificate or articles of incorporation or other constituent document shall
provide for adjustments which, for events subsequent to the effective date of
such certificate or articles of incorporation or other constituent document,
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Article XIII. The above provisions shall similarly apply to
successive transactions of the foregoing type.

SECTION 13.05  Notice of Adjustments of Conversion Price.

          Whenever the Applicable Conversion Price is adjusted as herein
provided:

          (a) the Company shall compute the adjusted Applicable Conversion Price
and shall prepare a certificate signed by the Chief Financial Officer or the
Treasurer of the Company setting forth the adjusted Applicable Conversion Price
and showing in reasonable detail the facts upon which such adjustment is based,
and such certificate shall forthwith be filed with the Trustee, the Conversion
Agent, the Property Trustee and the transfer agent for the Preferred Securities
and the Securities; and

          (b) a notice stating the Applicable Conversion Price has been adjusted
and setting forth the adjusted Applicable Conversion Price shall as soon as
practicable be mailed by the Company to all record holders of Preferred
Securities and the Securities at their last addresses as they appear upon the
stock transfer books of the Company and the books and records of the Trust,
respectively.

SECTION 13.06  Prior Notice of Certain Events.

          In case:

               (i) the Company shall (1) declare any dividend (or any other
distribution) on its Common Stock, other than (A) a dividend payable in shares
of Common Stock or (B) a dividend payable in cash that would not require an
adjustment pursuant to Section 13.03(iv) or (v) or (2) authorize a tender or
exchange offer that would require an adjustment pursuant to Section 13.03(vi);

               (ii) the Company shall authorize the granting to all holders of
Common Stock of rights or warrants to subscribe for or purchase any shares of
stock of any class or series or of any other rights or warrants;

               (iii) of any reclassification of Common Stock (other than a
subdivision or combination of the outstanding Common Stock, or a change in par
value, or from par value to no par value, or from no par value to par value), or
of any consolidation or merger to which the Company is a party and for which
approval of any stockholders of the Company shall be required, or of the sale or
transfer of all or substantially all of the assets of the Company or of any
compulsory share exchange whereby the Common Stock is converted into other
securities, cash or other property; or

                                      -56-
<PAGE>

               (iv) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company;

then the Company shall (a) if any Preferred Securities are outstanding, cause to
be filed with the transfer agent for the Preferred Securities, and shall cause
to be mailed to the holders of record of the Preferred Securities, at their last
addresses as they shall appear upon the books and records of the Trust, or (b)
shall cause to be mailed to all holders at their last addresses as they shall
appear in the Security Register, at least fifteen days prior to the applicable
record or effective date hereinafter specified, a notice stating (x) the date on
which a record (if any) is to be taken for the purpose of such dividend,
distribution, rights or warrants or, if a record is not to be taken, the date as
of which the holders of Common Stock of record to be entitled to such dividend,
distribution, rights or warrants are to be determined or (y) the date on which
such reclassification, consolidation, merger, sale, transfer, share exchange,
dissolution, liquidation or winding up is expected to become effective, and the
date as of which it is expected that holders of Common Stock of record shall be
entitled to exchange their shares of Common Stock for securities, cash or other
property deliverable upon such reclassification, consolidation, merger, sale,
transfer, share exchange, dissolution, liquidation or winding up (but no failure
to mail such notice or any defect therein or in the mailing thereof shall affect
the validity of the corporate action required to be specified in such notice).

SECTION 13.07  Definitions Applicable to Article XIII.

          (a) The following definitions shall apply to terms used in this
Article XIII:

               (1) "Applicable Conversion Price" has the meaning specified in
          Section 13.01.

               (2) "Closing Price" of any security on any day shall mean on any
          day the last reported sale price of such security on such day, or in
          case no sale takes place on such day, the average of the closing bid
          and asked prices in each case on the principal national securities
          exchange on which such securities are listed or admitted to trading
          or, if not listed or admitted to trading on any national securities
          exchange, on the NNM or, if such securities are not listed or admitted
          to trading on any national securities exchange or quoted on the NNM,
          the average of the closing bid and asked prices in the
          over-the-counter market as furnished by any New York Stock Exchange
          member firm selected by the Company Common Stock" means common stock,
          par value $.01 per share, of the Company (or shares of any class or
          classes resulting from any reclassification or reclassifications
          thereof).

               (3) "Company Transaction" has the meaning specified in Section
          13.04.

               (4) "Conversion Agent" means the Person appointed to act on
          behalf of the holders of Preferred Securities in effecting the
          conversion of Preferred Securities as and in the manner set forth in
          the Declaration and Section 13.02 hereof.

               (5) "Conversion Date" has the meaning specified in Section
          13.02.for such purpose.

               (6) "Initial Conversion Price" has the meaning specified in
          Section 13.01.

                                      -57-
<PAGE>

               (7) "NNM" means the National Market System of the National
          Association of Securities Dealers, Inc., or any successor national
          automated interdealer quotation system.

               (8) "Notice of Conversion" means the notice to be given by a
          holder of Preferred Securities to the Conversion Agent directing the
          Conversion Agent to exchange such Preferred Securities for Securities
          and to convert such Securities into Common Stock on behalf of such
          holder.

               (9) "Trading Day" shall mean a day on which securities are traded
          on the national securities exchange or quotation system used to
          determine the Closing Price.

SECTION 13.08  Dividend or Interest Reinvestment Plans.

          (a) Notwithstanding the foregoing provisions, the issuance of any
shares of Common Stock pursuant to any present or future plan providing for the
reinvestment of dividends or interest payable on securities of the Company and
the investment of additional optional amounts in shares of Common Stock under
any such plan, and the issuance of any shares of Common Stock or options or
rights to purchase such shares pursuant to any employee benefit plan or program
of the Company or pursuant to any option issued, shall not be deemed to
constitute an issuance of Common Stock or exercisable, exchangeable or
convertible securities by the Company to which any of the adjustment provisions
described above applies.

          (b) There shall also be no adjustment of the Applicable Conversion
Price in case of the issuance of any stock (or securities convertible into or
exchangeable for stock) of the Company except as specifically described in this
Article XIII.

SECTION 13.09  Certain Additional Rights.

          Notwithstanding any other provision of this Article XIII to the
contrary, rights, warrants, evidences of indebtedness, other securities, cash or
other assets (including, without limitation, any rights distributed pursuant to
any stockholder rights plan) shall be deemed not to have been distributed for
purposes of this Article XIII if the Company makes proper provision so that each
holder who converts a Security (or any portion thereof) after the date fixed for
determination of stockholders entitled to receive such distribution shall be
entitled to receive upon such conversion, in addition to the shares of Common
Stock issuable upon such conversion, the amount and kind of such distributions
that such holder would have been entitled to receive if such holder had,
immediately prior to such determination date, converted such Security into
Common Stock.

SECTION 13.10  Restrictions on Common Stock Issuable Upon Conversion.

          If shares of Common Stock to be issued upon conversion of a Security
in respect of Preferred Securities are to be registered in a name other than
that of the holder of such Preferred Security, then the Person in whose name
such shares of Common Stock are to be registered must deliver to the Conversion
Agent a certificate satisfactory to the Company and signed by such Person, as to
compliance with the restrictions on transfer applicable to such Preferred
Security. Neither the Trustee nor any Conversion Agent or Registrar shall be
required to register in a name other than that of the

                                      -58-
<PAGE>

holder shares of Common Stock or such Preferred Securities issued upon
conversion of any such Security in respect of such Preferred Securities not so
accompanied by a properly completed certificate.

SECTION 13.11  Trustee Not Responsible for Determining  Conversion Price or
               Adjustments.

          Neither the Trustee nor any Conversion Agent shall at any time be
under any duty or responsibility to any holder of any Security to determine
whether any facts exist which may require any adjustment of the Applicable
Conversion Price, or with respect to the nature or extent of any such adjustment
when made, or with respect to the method employed, or whether any supplemental
indenture needs to be entered into. Neither the Trustee nor any Conversion Agent
shall be accountable with respect to the validity or value (or the kind or
amount) of any shares of Common Stock or of any securities or property, which
may at any time be issued or delivered upon the conversion of any Security; and
neither the Trustee nor any Conversion Agent makes any representation with
respect thereto. Neither the Trustee nor any Conversion Agent shall be
responsible for any failure of the Company to make any cash payment or to issue,
transfer or deliver any shares of Common Stock or stock certificates or other
securities or property upon the surrender of any Security for the purpose of
conversion, or, except as expressly herein provided, to comply with any of the
covenants of the Company contained in Article X or this Article XIII.]

                      [REMAINDER OF THIS PAGE LEFT BLANK.]

                                      -59-
<PAGE>

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

                                             DYNEGY INC.

                                             By:______________________________
                                             Name:____________________________
                                             Title:___________________________

                                             BANK ONE TRUST COMPANY, NATIONAL
                                             ASSOCIATION,
                                             as Trustee

                                             By:______________________________
                                             Name:____________________________
                                             Title:___________________________

                                      -60-
<PAGE>

                                    EXHIBIT A
                           (FORM OF FACE OF SECURITY)

          [Include if a Global Security: THIS SECURITY IS A GLOBAL SECURITY
WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN
THE NAME OF THE DEPOSITORY TRUST COMPANY (THE "DEPOSITARY" OR "DTC") OR A
NOMINEE OF THE DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO
A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED
CIRCUMSTANCES.

          UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (55 WATER STREET, NEW YORK, NEW YORK) TO CONTINENTAL AIRLINES, INC. OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO.,
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC)
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.

          TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO BELOW.]

                                                     [CUSIP NO:______________]

                                      A-1
<PAGE>

No._______________                                          Principal Amount:___

                                   DYNEGY INC.
                     ________% JUNIOR SUBORDINATED DEBENTURE
                            DUE ______________, ____

          Dynegy Inc., a Delaware corporation (the "Company", which term
includes any successor Person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to Bank One Trust Company, National
Association, as Property Trustee for Dynegy Capital Trust III or registered
assigns, the principal sum of __________________ DOLLARS ($__________)
[Reference Schedule A if Global Security] on _________, ___ (the "Maturity
Date"), unless previously redeemed, and to pay interest on the outstanding
principal amount hereof from ___________, ____, or from the most recent interest
payment date (each such date, an "Interest Payment Date") to which interest has
been paid or duly provided for, semi-annually (subject to deferral as set forth
herein) in arrears on __________ and __________ of each year, commencing
______________, ____, at the rate of ____% per annum until the principal hereof
shall have become due and payable, and on any overdue principal and premium, if
any, and (without duplication and to the extent that payment of such interest is
enforceable under applicable law) on any overdue installment of interest at the
same rate per annum compounded semi-annually. The amount of interest payable on
any Interest Payment Date shall be computed on the basis of a 360-day year of
twelve 30-day months and, for any period less than a full calendar month, the
number of days elapsed in such month. In the event that any date on which the
principal of (or premium, if any) or interest on this Security is payable is not
a Business Day, then the payment payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest or other payment
in respect of any such delay), except that if such next succeeding Business Day
falls in the next calendar year, then such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on the date such payment is otherwise required. Pursuant to the
Indenture, in certain circumstances the Company will be required to pay
Additional Sums and Compounded Interest (each as defined in the Indenture) with
respect to this Security.

          The interest installment so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in the Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities, as defined in said Indenture) is registered at the close of business
on the regular record date for such interest installment, which shall be at the
close of business on the _____ day of the month preceding the month in which the
relevant interest payment date falls. Any such interest installment not
punctually paid or duly provided for shall forthwith cease to be payable to the
holders on such regular record date and may be paid to the Person in whose name
this Security (or one or more Predecessor Securities) is registered at the close
of business on a special record date to be fixed by the Trustee for the payment
of such defaulted interest, notice whereof shall be given to the holders of
Securities not less than 10 days prior to such special record date, or may be
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities may be listed,
and upon such notice as may be required by such exchange, all as more fully
provided in the Indenture.

                                      A-2
<PAGE>

          The principal of (and premium, if any) and interest (including
Compounded Interest and Additional Sums, if any) on this Security shall be
payable at the office or agency of the Trustee maintained for that purpose in
any coin or currency of the United States of America that at the time of payment
is legal tender for payment of public and private debts; provided, however,
that, payment of interest may be made at the option of the Company by (i) check
mailed to the holder at such address as shall appear in the Security Register or
(ii) by transfer to an account maintained by the Person entitled thereto;
provided that proper written transfer instructions have been received by the
relevant record date. Notwithstanding the foregoing, so long as the Holder of
this Security is the Property Trustee, the payment of the principal of (and
premium, if any) and interest (including Compounded Interest and Additional
Sums, if any) on this Security will be made at such place and to such account as
may be designated by the Property Trustee.

          The indebtedness evidenced by this Security is, to the extent provided
in the Indenture, subordinate and junior in right of payment to the prior
payment in full of all Senior Indebtedness, and this Security is issued subject
to the provisions of the Indenture with respect thereto. Each holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his or her behalf to take
such action as may be necessary or appropriate to acknowledge or effectuate the
subordination so provided and (c) appoints the Trustee his or her
attorney-in-fact for any and all such purposes. Each holder hereof, by his or
her acceptance hereof, hereby waives all notice of the acceptance of the
subordination provisions contained herein and in the Indenture by each holder of
Senior Indebtedness, whether now outstanding or hereafter incurred, and waives
reliance by each such holder upon said provisions.

          This Security shall not be entitled to any benefit under the Indenture
hereinafter referred to, be valid or become obligatory for any purpose until the
Certificate of Authentication hereon shall have been signed by or on behalf of
the Trustee.

          The provisions of this Security are continued on the reverse side
hereof and such provisions shall for all purposes have the same effect as though
fully set forth at this place.

                                      A-3
<PAGE>

          IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed and sealed.

Dated:  _____________, ____

                                             DYNEGY INC.

                                             By:______________________________
                                             Name:____________________________
                                             Title:___________________________

                                             Attest:

                                             By:______________________________
                                             Name:____________________________
                                             Title:___________________________

                                      A-4
<PAGE>

                     (FORM OF CERTIFICATE OF AUTHENTICATION)
                          CERTIFICATE OF AUTHENTICATION

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

BANK ONE TRUST COMPANY, NATIONAL ASSOCIATION,
as Trustee

By:___________________________
Authorized Signatory

                                      A-5
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                          (FORM OF REVERSE OF SECURITY)

          This Security is one of the Securities of the Company (herein
sometimes referred to as the "Securities"), specified in the Indenture, all
issued or to be issued under and pursuant to an Indenture, dated as of
___________, ___ (the "Indenture"), duly executed and delivered between the
Company and Bank One Trust Company, National Association, as Trustee (the
"Trustee"), to which Indenture reference is hereby made for a description of the
rights, limitations of rights, obligations, duties and immunities thereunder of
the Trustee, the Company and the holders of the Securities.

          [Upon the occurrence and continuation of a Special Event at any time,
the Company shall have the right, at any time within 90 days following the
occurrence of such Special Event, to redeem this Security in whole (but not in
part) at the Special Event Redemption Price. "Special Event Redemption Price"
shall mean, with respect to any redemption of the Securities following a Special
Event, an amount in cash equal to _________________.]

          [In addition, the Company shall have the right to redeem this
Security, in whole or in part, at any time (an "Optional Redemption"), at a
redemption price (the "Optional Redemption Price") equal to __________________.]

          [The Optional Redemption Price or the Special Event Redemption Price,
as the case requires, shall be paid prior to 12:00 noon, New York City time, on
the date of such redemption or at such earlier time as the Company determines;
provided, that the Company shall deposit with the Trustee an amount sufficient
to pay the applicable Redemption Price by 10:00 a.m., New York City time, on the
date such Redemption Price is to be paid. Any redemption pursuant to this
paragraph will be made upon not less than 30 days nor more than 60 days notice.
If the Securities are only partially redeemed by the Company pursuant to an
Optional Redemption, the particular Securities to be redeemed shall be selected
on a pro rata basis not more than 60 days prior to the date fixed for redemption
from the outstanding Securities not previously called for redemption; provided,
however, that any such proration may be made on the basis of the aggregate
principal amount of Securities held by each Securityholder thereof and may be
made by making such adjustments as the Company deems fair and appropriate in
order that only Securities in denominations of [$__________] or integral
multiples thereof shall be redeemed.]

          [The holder of any Security has the right, exercisable at any time
prior to 5:00 p.m., New York City time, on _____________, to convert the
principal amount thereof (or any portion thereof that is an integral multiple of
$____) into [a number of fully paid and nonassessable shares of Common Stock
equal to the $____ principal amount per Security divided by the initial
conversion price of $___ (the "Initial Conversion Price") (equal to an initial
conversion ratio of approximately _____shares of Common Stock for each $___ in
aggregate principal amount of Securities).] The conversion price and equivalent
conversion ratio are subject to adjustment under certain circumstances. If a
Security is called for redemption, the conversion right will terminate at the
close of business on the Business Day immediately preceding the corresponding
Redemption Date, unless the Company defaults in making the payment due upon
redemption.

          To convert a Security, a holder must (1) complete and sign a
conversion notice substantially in the form attached hereto, (2) surrender the
Security to a Conversion Agent, (3) furnish appropriate

                                      A-6
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endorsements or transfer documents if required by the Security Registrar or
Conversion Agent and (4) pay any transfer or similar tax, if required. Upon
conversion, no adjustment or payment will be made for interest or dividends, but
if any holder surrenders a Security for conversion after the close of business
on the regular record date for the payment of an installment of interest and
prior to the opening of business on the next Interest Payment Date, then,
notwithstanding such conversion, the interest payable on such Interest Payment
Date will be paid to the registered holder of such Security on such regular
record date. In such event, such Security, when surrendered for conversion, need
not be accompanied by payment of an amount equal to the interest payable on such
Interest Payment Date on the portion so converted. The number of shares issuable
upon conversion of a Security is determined by dividing the principal amount of
the Security converted by the Applicable Conversion Price in effect on the
Conversion Date. No fractional shares will be issued upon conversion but a cash
adjustment will be made for any fractional interest. The outstanding principal
amount of any Security shall be reduced by the portion of the principal amount
thereof converted into shares of Common Stock.]

          In the event of redemption of this Security in part only, a new
Security or Securities for the unredeemed portion hereof will be issued in the
name of the holder hereof upon the cancellation hereof.

          In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all of the Securities may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.

          The Indenture contains provisions for satisfaction and discharge of
the entire indebtedness of this Security upon compliance by the Company with
certain conditions set forth in the Indenture.

          The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of a majority in aggregate principal
amount of the Securities at the time outstanding, as defined in the Indenture,
to execute supplemental indentures for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of the Indenture
or of modifying in any manner the rights of the holders of the Securities;
provided, however, that no such supplemental indenture shall, without the
consent of each holder of Securities then outstanding and affected thereby, (i)
change the Maturity Date of any Securities, or reduce the principal amount
thereof, or reduce any amount payable on redemption thereof, or reduce the rate
or extend the time of payment of interest thereon (subject to Section 2.13 of
the Indenture), or make the principal of, or interest or premium on, the
Securities payable in any coin or currency other than U.S. dollars, or impair or
affect the right of any holder of Securities to institute suit for the payment
thereof [or adversely affect the right to convert such Security], or (ii) reduce
the aforesaid percentage of Securities, the holders of which are required to
consent to any such supplemental indenture. The Indenture also contains
provisions permitting the holders of a majority in aggregate principal amount of
the Securities at the time outstanding affected thereby, on behalf of all of the
holders of the Securities, to waive any past default in the performance of any
of the covenants contained in the Indenture, or established pursuant to the
Indenture, and its consequences, except a continuing default in the payment of
the principal of or premium, if any, or interest on any of the Securities or a
default in respect of any covenant or provision under which the Indenture cannot
be modified or amended without the consent of each

                                      A-7
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holder of Securities then outstanding. Any such consent or waiver by the holder
of this Security (unless revoked as provided in the Indenture) shall be
conclusive and binding upon such Holder and upon all future holders and owners
of this Security and of any Security issued in exchange therefor or in place
hereof (whether by registration of transfer or otherwise), irrespective of
whether or not any notation of such consent or waiver is made upon this
Security.

          No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of and premium, if any, and
interest (including Compounded Interest and Additional Sums, if any) on this
Security at the time and place and at the rate and in the money herein
prescribed [or to convert this Security as provided in the Indenture].

          So long as no Event of Default shall have occurred and be continuing,
the Company shall have the right, at any time and from time to time during the
term of the Securities, to defer payments of interest by extending the interest
payment period of such Securities for a period not exceeding 10 consecutive
[semi-annual] periods, including the first such [semi-annual] period during such
extension period, and not extending beyond the Maturity Date of the Securities
(an "Extended Interest Payment Period"), at the end of which period the Company
shall pay all interest then accrued and unpaid (together with interest thereon
at the rate specified for the Securities to the extent that payment of such
interest is enforceable under applicable law). Before the termination of any
such Extended Interest Payment Period, the Company may further defer payments of
interest by further extending such Extended Interest Payment Period; provided
that such Extended Interest Payment Period, together with all such previous and
further extensions within such Extended Interest Payment Period, shall not
exceed 10 consecutive [semi-annual] periods, including the first [semi-annual]
period during such Extended Interest Payment Period shall not extend beyond the
Maturity Date of the Securities. Upon the termination of any such Extended
Interest Payment Period and the payment of all accrued and unpaid interest and
any additional amounts then due, the Company may commence a new Extended
Interest Payment Period, subject to the foregoing requirements.

          The Company has agreed that it will not make certain payments on its
capital stock and certain other instruments during an Extension Period.

          The Company will have the right at any time to liquidate the Trust and
cause the Securities to be distributed to the holders of the Trust Securities in
liquidation of the Trust.

          The Securities are issuable only in registered form without coupons in
denominations of [$__________] and any integral multiple thereof. As provided in
the Indenture and subject to the transfer restrictions limitations as may be
contained herein and therein from time to time, this Security is transferable by
the holder hereof on the Security Register of the Company, upon surrender of
this Security for registration of transfer at the office or agency of the
Company in the City and State of New York accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company or the Trustee duly
executed by the holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities of authorized denominations and for the
same aggregate principal amount and series will be issued to the designated
transferee or transferees. No service charge will be made for any such
registration of transfer, but the Company

                                      A-8
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may require payment of a sum sufficient to cover any tax or other governmental
charge payable in relation thereto.

          Prior to due presentment for registration of transfer of this
Security, the Company, the Trustee, any authenticating agent, any paying agent,
any transfer agent and the registrar may deem and treat the holder hereof as the
absolute owner hereof (whether or not this Security shall be overdue and
notwithstanding any notice of ownership or writing hereon made by anyone other
than the Security Registrar) for the purpose of receiving payment of or on
account of the principal hereof and premium, if any, and (subject to the
Indenture) interest due hereon and for all other purposes, and neither the
Company nor the Trustee nor any authenticating agent nor any paying agent nor
any transfer agent nor any registrar shall be affected by any notice to the
contrary.

          No recourse shall be had for the payment of the principal of or
premium, if any, or interest on this Security, or for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the Indenture, against
any incorporator, stockholder, officer or director, past, present or future, as
such, of the Company or of any predecessor or successor Person, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issuance hereof, expressly
waived and released.

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

          THE INDENTURE AND THE SECURITIES SHALL BE DEEMED TO BE A CONTRACT MADE
UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

                                      A-9
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                                 Assignment Form

                    To assign this Security, fill in the form
                   below: (I) or (we) assign and transfer this
                                   Security to

_______________________________________________________________________________
                (Insert assignee's soc. sec. or tax I.D. no.)
_______________________________________________________________________________

_______________________________________________________________________________

_______________________________________________________________________________

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

and irrevocably appoint_________________________________________________________
to transfer this Security 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 face of this Security)

                              SIGNATURE GUARANTEE(1)

_______________________________________________________________________________

__________

(1)(Signature must be guaranteed by an "eligible guarantor institution" that is
a bank, stockbroker, savings and loan association or credit union meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.)

                                      A-10
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[TO BE ATTACHED TO GLOBAL SECURITIES]

                                   SCHEDULE A

                    The initial principal amount of this
                    Global Security shall be $_______. The
                    following increases or decreases in the
                    principal amount of this Global Security
                    have been made:

                 Amount of
                 decrease in
                 Principal
                 Amount of this
                 Global                           Principal
                 Security          Amount of      Amount of this   Signature of
                 including         increase in    Global           authorized
                 increase upon     Principal      Security         signatory of
                 exercise of       Amount of      following such   Trustee or
                 over-allotment    this Global    decrease (or     Securities
Date Made        option            Security       increase)        Custodian
---------        --------------    -----------    --------------   ------------

                                      A-11
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                               ELECTION TO CONVERT

          To: Dynegy Inc.

          The undersigned owner of this Security hereby irrevocably exercises
the option to convert this Security, or the portion below designated, into
Common Stock of Dynegy Inc. in accordance with the terms of the Indenture
referred to in this Security, and directs that the shares issuable and
deliverable upon conversion, together with any check in payment for fractional
shares, be issued in the name of and delivered to the undersigned, unless a
different name has been indicated in the assignment below. If shares are to be
issued in the name of a person other than the undersigned, the undersigned will
pay all transfer taxes payable with respect thereto.

          Any holder, upon the exercise of its conversion rights in accordance
with the terms of the Indenture and the Security, agrees to be bound by the
terms of the Registration Rights Agreement relating to the Common Stock issuable
upon conversion of the Securities.

Date: ________

in whole ___

Portions of Security to be converted ($____ or integral multiples thereof):
$________________________
____________________________________ Signature (for conversion only)

Please Print or Typewrite Name and Address, Including Zip Code, and Social
Security or Other Identifying Number ___________________________________________

________________________________________________________________________________

Signature Guarantee:(2)

________________________________________________________________________________

__________

(2)(Signature must be guaranteed by an "eligible guarantor institution" that is,
a bank, stockbroker, savings and loan association or credit union meeting the
requirements of the Registrar, which requirements include membership or
participation in the Securities Transfer Agents Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.)

                                      A-12

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