Document:

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                                CL&P FUNDING LLC,

                                 as Note Issuer

                                       and

                FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION,

                                 as Note Trustee

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

                                 NOTE INDENTURE

                           Dated as of March __, 2001

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

                                   [$________]

                             CL&P FUNDING LLC NOTES

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<PAGE>

                                TABLE OF CONTENTS

                                                                            PAGE

ARTICLE I     DEFINITIONS AND INCORPORATION BY REFERENCE....................  2

         Section 1.01.  Definitions.........................................  2

         Section 1.02.  Incorporation by Reference of Trust Indenture Act... 12

         Section 1.03.  Rules of Construction............................... 13

ARTICLE II    THE NOTES..................................................... 13

         Section 2.01.  Terms of the Notes.................................. 13

         Section 2.02.  Form................................................ 15

         Section 2.03.  Execution, Authentication and Delivery.............. 15

         Section 2.04.  Temporary Notes..................................... 16

         Section 2.05.  Registration; Registration of Transfer and
                        Exchange............................................ 16

         Section 2.06.  Mutilated, Destroyed, Lost or Stolen Notes.......... 17

         Section 2.07.  Persons Deemed Owner................................ 18

         Section 2.08.  Payment of Principal and Interest; Interest on
                        Overdue Principal; Principal and Interest Rights
                        Preserved........................................... 18

         Section 2.09.  Cancellation........................................ 19

         Section 2.10.  Authentication and Delivery of Notes................ 19

         Section 2.11.  Release of Collateral............................... 24

ARTICLE III   COVENANTS..................................................... 24

         Section 3.01.  Payment of Principal and Interest................... 24

         Section 3.02.  Maintenance of Office or Agency..................... 25

         Section 3.03.  Money for Payments To Be Held in Trust.............. 25

         Section 3.04.  Existence........................................... 26

         Section 3.05.  Protection of Collateral............................ 26

         Section 3.06.  Opinions as to Collateral........................... 27

         Section 3.07.  Performance of Obligations; Servicing; Commission
                        Filings............................................. 27

         Section 3.08.  Negative Covenants.................................. 29

         Section 3.09.  Annual Statement as to Compliance................... 30

         Section 3.10.  Note Issuer May Consolidate, etc., Only on Certain
                        Terms............................................... 30

         Section 3.11.  Successor or Transferee............................. 32

         Section 3.12.  No Other Business................................... 32

         Section 3.13.  No Borrowing........................................ 32

         Section 3.14.  Servicer's Obligations.............................. 32

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                               TABLE OF CONTENTS
                                  (CONTINUED)

                                                                            PAGE

         Section 3.15.  No Additional Notes................................. 32

         Section 3.16.  Guarantees, Loans, Advances and Other Liabilities... 32

         Section 3.17.  Capital Expenditures................................ 33

         Section 3.18.  Non-Routine Periodic Adjustment..................... 33

         Section 3.19.  Restricted Payments................................. 33

         Section 3.20.  Notice of Events of Default......................... 33

         Section 3.21.  Further Instruments and Acts........................ 33

ARTICLE IV    SATISFACTION AND DISCHARGE; DEFEASANCE........................ 33

         Section 4.01.  Satisfaction and Discharge of Note Indenture;
                        Defeasance.......................................... 33

         Section 4.02.  Conditions to Defeasance............................ 35

         Section 4.03.  Application of Trust Money.......................... 36

         Section 4.04.  Repayment of Moneys Held by Paying Agent............ 36

ARTICLE V     REMEDIES...................................................... 36

         Section   5.01.Events of Default................................... 36

         Section   5.02.Acceleration of Maturity; Rescission and Annulment.. 37

         Section 5.03.  Collection of Indebtedness and Suits for Enforcement
                        by Note Trustee..................................... 38

         Section 5.04.  Remedies; Priorities................................ 40

         Section 5.05.  Optional Possession of the Collateral............... 41

         Section 5.06.  Limitation of Suits................................. 41

         Section 5.07.  Unconditional Rights of Noteholders To Receive
                        Principal and Interest.............................. 42

         Section 5.08.  Restoration of Rights and Remedies.................. 42

         Section 5.09.  Rights and Remedies Cumulative...................... 42

         Section 5.10.  Delay or Omission Not a Waiver...................... 42

         Section 5.11.  Control by Noteholders.............................. 42

         Section 5.12.  Waiver of Past Defaults............................. 43

         Section 5.13.  Undertaking for Costs............................... 43

         Section 5.14.  Waiver of Stay or Extension Laws.................... 44

         Section 5.15.  Action on Notes..................................... 44

         Section 5.16.  Performance and Enforcement of Certain Obligations.. 44

         Section 5.17.  Inter-Creditor Agreement............................ 45

                                      -ii-

<PAGE>

                               TABLE OF CONTENTS
                                  (CONTINUED)

                                                                            PAGE

ARTICLE VI    THE NOTE TRUSTEE.............................................. 45

         Section 6.01.  Duties of Note Trustee.............................. 45

         Section 6.02.  Rights of Note Trustee.............................. 46

         Section 6.03.  Individual Rights of Note Trustee................... 47

         Section 6.04.  Note Trustee's Disclaimer........................... 47

         Section 6.05.  Notice of Defaults.................................. 47

         Section 6.06.  Reports by Note Trustee to Holders.................. 47

         Section 6.07.  Compensation and Indemnity.......................... 48

         Section 6.08.  Replacement of Note Trustee......................... 49

         Section 6.09.  Successor Note Trustee by Merger.................... 50

         Section 6.10.  Appointment of Co-Trustee or Separate Trustee....... 51

         Section 6.11.  Eligibility; Disqualification....................... 52

         Section 6.12.  Preferential Collection of Claims Against Note
                        Issuer.............................................. 52

         Section 6.13.  Representations and Warranties of Note Trustee...... 52

         Section 6.14.  Covenants of the Note Trustee....................... 52

ARTICLE VII   NOTEHOLDERS' LISTS AND REPORTS................................ 53

         Section 7.01.  Note Issuer To Furnish Note Trustee Names and
                        Addresses of Noteholders............................ 53

         Section 7.02.  Preservation of Information; Communications to
                        Noteholders......................................... 53

         Section 7.03.  Reports by Note Issuer.............................. 54

         Section 7.04.  Reports by Note Trustee............................. 54

ARTICLE VIII  Accounts, Disbursements and Releases.......................... 54

         Section 8.01.  Collection of Money................................. 54

         Section 8.02.  Collection Account.................................. 55

         Section 8.03.  General Provisions Regarding the Collection
                        Account............................................. 58

         Section 8.04.  Release of Collateral............................... 59

         Section 8.05.  Opinion of Counsel.................................. 59

         Section 8.06.  Reports by Independent Accountants.................. 60

ARTICLE IX    SUPPLEMENTAL NOTE INDENTURES.................................. 60

         Section 9.01.  Supplemental Note Indentures Without Consent of
                        Noteholders......................................... 60

         Section 9.02.  Supplemental Note Indentures with Consent of
                        Noteholders......................................... 61

         Section 9.03.  Execution of Supplemental Note Indentures........... 63

                                     -iii-

<PAGE>

                               TABLE OF CONTENTS
                                  (CONTINUED)

                                                                            PAGE

         Section 9.04.  Effect of Supplemental Note Indenture............... 63

         Section 9.05.  Conformity with Trust Indenture Act................. 63

ARTICLE X     REDEMPTION OF NOTES........................................... 64

         Section 10.01. Optional Redemption by Note Issuer.................. 64

         Section 10.02. Form of Optional Redemption Notice.................. 64

         Section 10.03. Notes Payable on Optional Redemption Date or
                        Payment Date........................................ 64

         Section 10.04. Mandatory Redemption by Note Issuer................. 65

         Section 10.05. Form of Mandatory Redemption Notice................. 65

         Section 10.06. Notes Payable on Mandatory Redemption Date or
                        Payment Date........................................ 65

ARTICLE XI    MISCELLANEOUS................................................. 66

         Section 11.01. Compliance Certificates and Opinions, etc........... 66

         Section 11.02. Form of Documents Delivered to Note Trustee......... 67

         Section 11.03. Acts of Noteholders................................. 68

         Section 11.04. Notices............................................. 69

         Section 11.05. Notices to Noteholders; Waiver...................... 71

         Section 11.06. Conflict with Trust Indenture Act................... 71

         Section 11.07. Effect of Headings and Table of Contents............ 71

         Section 11.08. Successors and Assigns.............................. 71

         Section 11.09. Severability........................................ 71

         Section 11.10. Benefits of Note Indenture.......................... 72

         Section 11.11. Legal Holidays...................................... 72

         Section 11.12. GOVERNING LAW....................................... 72

         Section 11.13. Counterparts........................................ 72

         Section 11.14. Recording of Note Indenture......................... 72

         Section 11.15. No Recourse to Certain Persons...................... 72

         Section 11.16. No Recourse to Note Issuer.......................... 72

         Section 11.17. Inspection.......................................... 73

         Section 11.18. Nonpetition Covenants............................... 73

                                      -iv-

<PAGE>

     NOTE INDENTURE dated as of March __, 2001, between CL&P FUNDING LLC, a
Delaware limited liability company (the "Note Issuer"), and FIRST UNION TRUST
COMPANY, NATIONAL ASSOCIATION, a national banking association, as trustee (the
"Note Trustee").

                                    RECITALS

     The Note Issuer has duly authorized the execution and delivery of this Note
Indenture to provide for the issuance of its Notes with an aggregate principal
amount of [________] and the Note Issuer and the Note Trustee are executing and
delivering this Note Indenture in order to provide for the issuance of the
Notes.

                                 GRANTING CLAUSE

     The Note Issuer hereby Grants to the Note Trustee at the Issuance Date, as
Note Trustee for the benefit of the Holders of the Notes, all of the Note
Issuer's right, title and interest in and to (a) the Transition Property
transferred by the Seller to the Note Issuer pursuant to the Sale Agreement and
all proceeds thereof, (b) the Sale Agreement, (c) the Servicing Agreement, (d)
the Administration Agreement, (e) the Collection Account (including all
subaccounts thereof) and all amounts or investment property on deposit therein
or credited thereto from time to time, (f) all other property of whatever kind
owned from time to time by the Note Issuer, including accounts, general
intangibles, equipment and inventory, (g) the security interest with respect to
the Transition Property granted by the Seller to the Note Issuer in the Sale
Agreement, (h) all present and future claims, demands, causes and choses in
action in respect of any or all of the foregoing and all payments on or under
and all proceeds of every kind and nature whatsoever in respect of any or all of
the foregoing, including all proceeds of the conversion thereof, voluntary or
involuntary, into cash or other liquid property, all cash proceeds, accounts,
accounts receivable, notes, drafts, acceptances, chattel paper, checks, deposit
accounts, insurance proceeds, condemnation awards, rights to payment of any and
every kind, and other forms of obligations and receivables, instruments and
other property which at any time constitute all or part of or are included in
the proceeds of any of the foregoing and (i) all proceeds of the foregoing
(collectively, the "Collateral"; it being understood that the following do not
constitute Collateral: (i) amounts required to be released pursuant to or
contemplated in the terms hereof, including net investment earnings on the
Capital Subaccount that are required to be released to the Note Issuer pursuant
to Article VIII and (ii) proceeds from the sale of the Notes required to pay
costs of issuance with respect to the Notes or the Certificates as set forth on
the flow of funds memorandum delivered on the Issuance Date (together with any
interest earnings thereon), it being understood that such amounts described in
clauses (i) and (ii) above shall not be subject to Sections 3.10(b) or 3.19.

     The foregoing Grant is made in trust to secure the payment of principal of,
interest on, and any other amounts (which shall include all amounts payable to
the Note Trustee, the Certificate Trustee and the Delaware Trustee under this
Note Indenture, the Certificate Indenture and the Fee and Indemnity Agreement)
owing in respect of the Notes, equally and ratably without prejudice, priority
or distinction, except as expressly provided in this Note Indenture, and to
secure compliance with the provisions of this Note Indenture with respect to the
Notes, all as provided in this Note Indenture. This Note Indenture constitutes a
security agreement within the meaning of the UCC to the extent that, under
Connecticut law, the provisions of the UCC are applicable hereto.

<PAGE>

     The Note Trustee, as trustee on behalf of the Holders of the Notes,
acknowledges such grant, accepts the trusts hereunder in accordance with the
provisions hereof and agrees to perform its duties herein required.

     AND IT IS HEREBY COVENANTED, DECLARED AND AGREED between the parties hereto
that all Notes are to be issued, countersigned and delivered and that all of the
Collateral is to be held and applied, subject to the further covenants,
conditions, releases, uses and trusts hereinafter set forth, and the Note
Issuer, for itself and any successor, does hereby covenant and agree to and with
the Note Trustee and its successors in said trust, for the benefit of the
Holders, as follows:

                                   ARTICLE I

                   DEFINITIONS AND INCORPORATION BY REFERENCE

     Section 1.01.  DEFINITIONS. (a) Except as otherwise specified herein or as
the context may otherwise require, the following terms have the respective
meanings set forth below for all purposes of this Note Indenture.

     "ACT" has the meaning specified in Section 11.03(a).

     "ADMINISTRATION AGREEMENT" means the Administration Agreement dated as of
March __, 2001, between The Connecticut Light and Power Company, as
Administrator, and the Note Issuer, as the same may be amended and supplemented
from time to time.

     "ADMINISTRATION FEE" means the fee payable to the Administrator pursuant to
the Administration Agreement.

     "ADMINISTRATOR" means The Connecticut Light and Power Company, a
Connecticut corporation, or any successor Administrator under the Administration
Agreement.

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

     "AUTHORIZED OFFICER" means, with respect to the Note Issuer, the
Administrator or the Servicer, as applicable, any officer of such Person who is
authorized to act for such Person in matters relating to such Person and who is
identified on the list of Authorized Officers or Responsible Officers delivered
by such Person to the Note Trustee on the Issuance Date (as such list may be
modified or supplemented by the Note Issuer, the Administrator or the Servicer,
as applicable, from time to time thereafter).

                                      -2-

<PAGE>

     "BASIC DOCUMENTS" means, collectively, this Note Indenture, the Certificate
Indenture, the Declaration of Trust, the Sale Agreement, the Servicing
Agreement, the Administration Agreement, the Note Purchase Agreement, the Fee
and Indemnity Agreement, the Underwriting Agreement, the Inter-Creditor
Agreement and the Swap Agreement.

     "BUSINESS DAY" means any day other than a Saturday, a Sunday or a day on
which banking institutions or trust companies in New York, New York, Hartford,
Connecticut or Wilmington, Delaware are authorized or obligated by law,
regulation or executive order to remain closed.

     "CAPITAL SUBACCOUNT" has the meaning specified in Section 8.02(a).

     "CERTIFICATE INDENTURE" means the Certificate Indenture dated as of March
__, 2001, between the Certificate Issuer, the Delaware Trustee and the
Certificate Trustee, as the same may be further amended and supplemented from
time to time.

     "CERTIFICATE ISSUER" has the meaning specified in the Certificate
Indenture.

     "CERTIFICATE TRUSTEE" means the Person acting as certificate trustee under
the Certificate Indenture.

     "CERTIFICATES" has the meaning specified in the Certificate Indenture.

     "CLASS" means any one of the classes of Notes.

     "CODE" means the Internal Revenue Code of 1986, as amended from time to
time, and Treasury Regulations promulgated thereunder.

     "COLLATERAL" has the meaning specified in the Granting Clause of this Note
Indenture.

     "COLLECTION ACCOUNT" has the meaning specified in Section 8.02(a).

     "CONNECTICUT UCC" means Title 42a of the Connecticut General Statutes.

     "CORPORATE TRUST OFFICE" means the principal office of the Note Trustee at
which at any particular time its corporate trust business shall be administered,
which office at the date of the execution of this Note Indenture is located at
the address provided in Section 11.04, or at such other address as the Note
Trustee may designate from time to time by notice to the Noteholders and the
Note Issuer, or the principal corporate trust office of any successor Note
Trustee (the address of which the successor Note Trustee will notify the
Noteholders and the Note Issuer).

     "COVENANT DEFEASANCE OPTION" has the meaning specified in Section 4.01(b).

     "DECLARATION OF TRUST" has the meaning specified in the Certificate
Indenture.

     "DEFAULT" means any occurrence that is, or with notice or the lapse of time
or both would become, an Event of Default.

                                      -3-

<PAGE>

     "DELAWARE TRUSTEE" means the Person acting as Delaware Trustee under the
Declaration of Trust and the Certificate Indenture.

     "DELAWARE UCC" means Del. Code Ann. tit. 6,ss.ss.1-101 to 11-109.

     "DPUC" means the Connecticut Department of Public Utility Control and any
successor thereto.

     "DTC AGREEMENT" has the meaning specified in the Certificate Indenture.

     "ELIGIBLE DEPOSIT ACCOUNT" means either (a) a segregated trust account with
an Eligible Institution or (b) a segregated trust account with the corporate
trust department of a depository institution organized under the laws of the
United States of America or any one of the states thereof or the District of
Columbia (or any domestic branch of a foreign bank), having corporate trust
powers and acting as trustee for funds deposited in such account, so long as any
of the securities of such depository institution shall have a credit rating from
each Rating Agency in one of its generic rating categories which signifies
investment grade.

     "ELIGIBLE INSTITUTION" means (a) the corporate trust department of the Note
Trustee or (b) a depository institution organized under the laws of the United
States of America, any State or the District of Columbia (or any domestic branch
of a foreign bank), (i) which has either (A) with respect to any Eligible
Investment having a maturity of greater than one month, a long-term unsecured
debt rating of AAA by Standard & Poor's and Fitch and Aaa by Moody's or (B) with
respect to any Eligible Investment having a maturity of one month or less, a
certificate of deposit rating of A-1+ by Standard & Poor's, F1+ by Fitch and P-1
by Moody's, or any other long-term, short-term or certificate of deposit rating
acceptable to Standard & Poor's and Moody's and (ii) whose deposits are insured
by the FDIC. If so qualified under clause (b) above, the Note Trustee may be
considered an Eligible Institution for the purposes of clause (a) of the
definition of Eligible Deposit Account.

     "ELIGIBLE INVESTMENTS" mean book-entry securities, negotiable instruments
or securities represented by instruments in bearer or registered form which
evidence:

          (a) direct obligations of, and obligations fully and unconditionally
     guaranteed as to timely payment by, the United States of America;

          (b) demand deposits, time deposits or certificates of deposit of any
     depository institution or trust company (any depositary institution or
     trust company being referred to in this definition as a "financial
     institution") incorporated under the laws of the United States or any state
     thereof (or any domestic branch of a foreign bank) and subject to
     supervision and examination by federal or state banking or depositary
     institution authorities; provided, however, that at the time of the
     investment or contractual commitment to invest therein, the commercial
     paper or other short-term unsecured debt obligations (other than such
     obligations the rating of which is based on the credit of a Person other
     than such depositary institution or trust company) thereof shall have a
     credit rating from each of the Rating Agencies in the highest investment
     category granted thereby; meeting the requirements of clause (e) of the
     definition of Eligible Institution;

                                      -4-

<PAGE>

          (c) commercial paper or other short term obligations of any
     corporation organized under the laws of the United States of America (other
     than the Seller or its Affiliates) whose ratings, at the time of the
     investment or contractual commitment to invest therein, from each of the
     Rating Agencies are in the highest investment category granted thereby;

          (d) demand deposits, time deposits and certificates of deposit which
     are fully insured by the Federal Deposit Insurance Corporation;

          (e) investments in money market funds having a rating from each of the
     Rating Agencies in the highest investment category granted thereby
     (including funds for which the Note Trustee or any of its Affiliates act as
     investment manager or advisor);

          (f) banker's acceptances issued by any depositary institution or trust
     company referred to in clause (b) above;

          (g) repurchase obligations with respect to any security that is a
     direct obligation of, or fully guaranteed by, the United States or any
     agency or instrumentality thereof the obligations of which are backed by
     the full faith and credit of the United States, in either case entered into
     with a depository institution or trust company (acting as principal)
     described in clause (b) above;

          (h) repurchase obligations with respect to any security or whole loan
     entered into with

               (i)     a financial institution (acting as principal) described
          in clause (b) above and, with respect to Moody's only, a minimum
          long-term unsecured rating of A1,

               (ii)    a broker/dealer (acting as principal) registered as a
          broker or dealer under Section 15 of the Exchange Act (any
          broker/dealer being referred to in this definition as a
          "broker/dealer"), the unsecured short-term debt obligations of which
          are rated P-1 by Moody's and A-1+ by Standard & Poor's at the time of
          entering into this repurchase obligation and with respect to Moody's
          only, a minimum long-term unsecured rating of A1, or

               (iii)   an unrated broker/dealer, acting as principal, that is a
          wholly-owned subsidiary of a non-bank or bank holding company, the
          unsecured short-term debt obligations of which are rated P-1 by
          Moody's and A-1+ by Standard & Poor's at the time of purchase; or

          (i) any other investment permitted by each Rating Agency;

provided, however, that, with respect to Moody's only, the obligor related to
clauses (b), (c), (d), (f), (g) and (h) above must have both a long term rating
of at least A1 and a short term rating of at least P-1, and provided, further,
that, unless otherwise permitted by each Rating Agency, upon the failure of any
Eligible Institution to maintain any applicable rating set forth in this

                                      -5-

<PAGE>

definition or the definition of Eligible Institution, the related investments at
such institution shall be reinvested in Eligible Investments at a successor
Eligible Institution within 10 days.

     "EVENT OF DEFAULT" has the meaning specified in Section 5.01.

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

     "EXPECTED AMORTIZATION SCHEDULE" means, with respect to each Class of
Notes, the schedule attached as Schedule 1 hereto.

     "FDIC" means the Federal Deposit Insurance Corporation or any successor.

     "FEE AND INDEMNITY AGREEMENT" means the fee and indemnity agreement dated
as of March __, 2001, among the Note Issuer, the Delaware Trustee, the
Certificate Trustee, the Certificate Issuer and the Finance Authority, as
amended and supplemented from time to time.

     "FINAL MATURITY DATE" means, with respect to any Class of Notes, the Final
Maturity Date therefor, as specified in Section 2.01(b).

     "FINANCE AUTHORITY" means the State of Connecticut, acting through the
office of the State Treasurer.

     "FINANCIAL ASSET" means a "financial asset" as defined in Section
42a-8-102(a)(10) of the Connecticut UCC.

     "FITCH" means Fitch, Inc. or its successor.

     "GENERAL SUBACCOUNT" has the meaning specified in Section 8.02(a).

     "GRANT" means mortgage, pledge, collaterally assign and grant a lien upon
and a security interest pursuant to this Note Indenture. A Grant of the
Collateral or of any other agreement or instrument shall include all rights,
powers and options (but none of the obligations) of the Granting party
thereunder, including after an Event of Default which is continuing the
immediate and continuing right to claim for, collect, receive and give receipt
for payments in respect of the Collateral and all other moneys payable
thereunder, to give and receive notices and other communications, to make
waivers or other agreements, to exercise all rights and options, to bring
Proceedings in the name of the Granting party or otherwise and generally to do
and receive anything that the Granting party is or may be entitled to do or
receive thereunder or with respect thereto.

     "INDEMNIFIED PERSON" has the meaning specified in Section 6.07.

     "INDEPENDENT" means, when used with respect to any specified Person, that
the Person (a) is in fact independent of the Note Issuer, any other obligor upon
the Notes, the Seller, the Servicer and any Affiliate of any of the foregoing
Persons, (b) does not have any direct financial interest or any material
indirect financial interest in the Note Issuer, any such other obligor, the
Seller, the Servicer or any Affiliate of any of the foregoing Persons and (c) is
not connected with the Note Issuer, any such other obligor, the Seller, the
Servicer or any Affiliate of any of the foregoing Persons as an officer,

                                      -6-

<PAGE>

employee, promoter, underwriter, trustee, partner, director or person performing
similar functions, provided, however, that an individual shall be deemed to be
an Independent director of the Note Issuer notwithstanding the fact that he or
she is or has been a director of one or more other single purpose bankruptcy
remote entities which are Affiliates of the Note Issuer, the Seller, the
Servicer or any Affiliate thereof.

     "INDEPENDENT CERTIFICATE" means a certificate or opinion to be delivered to
the Note Trustee under the circumstances described in, and otherwise complying
with, the applicable requirements of Section 11.01, made by an Independent
appraiser or other expert appointed by an Issuer Order and consented to by the
Note Trustee, and such opinion or certificate shall state that the signer has
read the definition of "Independent" in this Note Indenture and that the signer
is Independent within the meaning thereof.

     "INTER-CREDITOR AGREEMENT" means the Inter-Creditor Agreement dated as of
March __, 2001 among Citicorp North America, Inc., Citibank, N.A., the Servicer,
the Note Trustee, the Note Issuer and CL&P Receivables Corporation, as amended,
supplemented or modified from time to time.

     "ISSUANCE DATE" has the meaning specified in Section 2.01(c)(i).

     "ISSUER ORDER" and "ISSUER REQUEST" means a written order or request signed
in the name of the Note Issuer by any one of its Authorized Officers and
delivered to the Note Trustee.

     "LEGAL DEFEASANCE OPTION" has the meaning specified in Section 4.01(b).

     "MANDATORY REDEMPTION DATE" has the meaning specified in Section 10.04.

     "MANDATORY REDEMPTION PRICE" has the meaning specified in Section 10.04.

     "MINIMUM DENOMINATION" means $1,000 or any integral multiple of $1.00 in
excess thereof; provided, however, that one Note of each Class may be of a
smaller denomination.

     "MOODY'S" means Moody's Investors Service Inc. or its successor.

     "NOTE INDENTURE" or "THIS NOTE INDENTURE" means this instrument as
originally executed and, as from time to time supplemented or amended by one or
more indentures supplemental hereto entered into pursuant to the applicable
provisions hereof, as so supplemented or amended, or both, and shall include the
forms and terms of the Notes established hereunder.

     "NOTE INTEREST RATE" has the meaning specified in Section 2.01(b).

     "NOTE ISSUER" means the party named as such in this Note Indenture until a
successor replaces it and, thereafter, means the successor and, for purposes of
any provision contained herein and required by the Trust Indenture Act, each
other obligor on the Notes.

     "NOTE PURCHASE AGREEMENT" has the meaning specified in the Certificate
Indenture.

                                      -7-

<PAGE>

     "NOTE REGISTER" and "NOTE REGISTRAR" have the respective meanings specified
in Section 2.05.

     "NOTE TRUSTEE" means First Union Trust Company, National Association, a
national banking association, as Note Trustee under this Note Indenture, or any
successor Note Trustee under this Note Indenture.

     "NOTEHOLDER" or "HOLDER" means the Person in whose name a Note is
registered on the Note Register.

     "NOTES" has the meaning specified in Section 2.01(a).

     "OFFICER'S CERTIFICATE" means a certificate signed by any Authorized
Officer of the Note Issuer, under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.01, and delivered to
the Note Trustee.

     "OPERATING EXPENSES" means all fees, costs and expenses of, and indemnities
owed by, the Note Issuer, including all amounts owed by the Note Issuer to the
Note Trustee, the Certificate Issuer, the Certificate Trustee, the Delaware
Trustee, the Finance Authority and any other Indemnified Person, the Servicing
Fee, the Administration Fee, any fees, costs and expenses payable or
reimbursable by the Note Issuer to the Administrator, Seller or Servicer, and
legal and accounting fees, costs and expenses of the Note Issuer and the
Certificate Issuer.

     "OPINION OF COUNSEL" means one or more written opinions of counsel who may,
except as otherwise expressly provided in this Note Indenture, be an employee of
or counsel to the Note Issuer and who shall be reasonably satisfactory to the
Note Trustee, and which opinion or opinions shall be addressed to the Note
Trustee, as trustee, shall comply with any applicable requirements of Section
11.01, and shall be in form and substance reasonably satisfactory to the Note
Trustee.

     "OPTIONAL REDEMPTION DATE" means the Payment Date specified by the Note
Issuer for the redemption of the Notes pursuant to Section 10.01.

     "OPTIONAL REDEMPTION PRICE" has the meaning specified in Section 10.01.

     "OUTSTANDING" means, as of the date of determination, all Notes theretofore
authenticated and delivered under this Note Indenture except:

         (i)   Notes theretofore cancelled by the Note Registrar or delivered
     to the Note Registrar for cancellation;

          (ii)   Notes or portions thereof the payment for which money in the
     necessary amount has been theretofore deposited with the Note Trustee or
     any Paying Agent in trust for the Holders of such Notes (provided, however,
     that if such Notes are to be redeemed, notice of such redemption has been
     duly given pursuant to this Note Indenture or provision made therefor,
     reasonably satisfactory to the Note Trustee); and

                                      -8-

<PAGE>

          (iii)  Notes in exchange for or in lieu of other Notes which have been
     authenticated and delivered pursuant to this Note Indenture unless proof
     satisfactory to the Note Trustee is presented that any such Notes are held
     by a bona fide purchaser;

provided, however, that in determining whether the Holders of the requisite
Outstanding Amount of the Notes or any Class thereof have given any request,
demand, authorization, direction, notice, consent or waiver hereunder or under
any Basic Document, Notes owned by the Note Issuer, any other obligor upon the
Notes, the Seller or any Affiliate of any of the foregoing Persons shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Note Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Notes that the
Note Trustee actually knows to be so owned shall be so disregarded. Notes so
owned that have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Note Trustee the pledgee's right
so to act with respect to such Notes and that the pledgee is not the Note
Issuer, any other obligor upon the Notes, the Seller or any Affiliate of any of
the foregoing Persons.

     "OUTSTANDING AMOUNT" means the aggregate principal amount of all Notes or,
if the context requires, all Notes of a Class, Outstanding at the date of
determination.

     "OVERCOLLATERALIZATION SUBACCOUNT" has the meaning specified in Section
8.02(a).

     "PAYING AGENT" means the Note Trustee or any other Person that meets the
eligibility standards for the Note Trustee specified in Section 6.11 and is
authorized by the Note Issuer to make payment of principal of or interest on the
Notes on behalf of the Note Issuer.

     "PAYMENT DATE" has the meaning specified in Section 2.01(c)(ii).

     "PERSON" means any individual, corporation, limited liability company,
estate, partnership, joint venture, association, joint stock company, trust
(including any beneficiary thereof), unincorporated organization or government
or any agency or political subdivision thereof.

     "PREDECESSOR NOTE" means, with respect to any particular Note, every
previous Note evidencing all or a portion of the same debt as that evidenced by
such particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.06 in lieu of a mutilated, lost,
destroyed or stolen Note shall be deemed to evidence the same debt as the
mutilated, lost, destroyed or stolen Note.

     "PROCEEDING" means any suit in equity, action at law or other judicial or
administrative proceeding.

     "PROJECTED PRINCIPAL BALANCE" means, as of any Payment Date on any Class of
Notes, the projected outstanding principal amount of such Class of Notes for
such Payment Date set forth in the Expected Amortization Schedule.

     "QUARTERLY INTEREST" has the meaning specified in Section 2.01(c)(iv).

                                      -9-

<PAGE>

     "QUARTERLY PRINCIPAL" means, with respect to any Payment Date on any Class
of Notes, the excess, if any, of the Outstanding Amount of such Class of Notes
over the outstanding principal balance of such Class of Notes specified for such
Payment Date in the Expected Amortization Schedule.

     "RATING AGENCY" means, collectively, Moody's, Standard & Poor's and Fitch.
If no such organization or successor is any longer in existence, "Rating Agency"
shall be a nationally recognized statistical rating organization or other
comparable Person designated by the Note Issuer, notice of which designation
shall be given to the Note Trustee, the Certificate Trustee and the Servicer.

     "RATING AGENCY CONDITION" means, with respect to any action, that each
Rating Agency shall have been given ten days prior notice thereof and, except as
otherwise expressly set forth in the related Basic Document, that each of the
Rating Agencies shall have notified the Servicer, the Note Issuer, the Note
Trustee, the Finance Authority and the Certificate Trustee in writing that such
action will not result in a reduction or withdrawal of the then current rating
by such Rating Agency of any Class of the Notes or any Class of the
Certificates.

     "RECORD DATE" means, with respect to a Payment Date, Optional Redemption
Date or Mandatory Redemption Date, the close of business on the last day of the
calendar month preceding the calendar month in which such Payment Date, Optional
Redemption Date or Mandatory Redemption Date occurs.

     "REGISTERED HOLDER" means the Person in whose name a Note is registered on
the Note Register on the applicable Record Date.

     "REPURCHASE DATE" has the meaning specified in the Sale Agreement.

     "REQUIRED CAPITAL LEVEL" means, as of any Payment Date, .50 percent of the
initial principal amount of the Notes.

     "REQUIRED OVERCOLLATERALIZATION LEVEL" means, as of any Payment Date, the
amount required to be on deposit in the Overcollateralization Subaccount as
specified in Schedule 2 hereto.

     "RESERVE SUBACCOUNT" has the meaning specified in Section 8.02(a).

     "RESPONSIBLE OFFICER" means any officer within the Corporate Trust Office,
including any Managing Director, Vice President, Assistant Vice President,
Secretary, Assistant Secretary or Assistant Treasurer or any other officer of
the Note Trustee customarily performing functions similar to those performed by
any of the above designated officers and also, with respect to a particular
matter, any other officer to whom such matter is referred because of such
officer's knowledge and familiarity with the particular subject.

     "SALE AGREEMENT" means the Transition Property Purchase and Sale Agreement
dated as of March __, 2001, between the Note Issuer and the Seller, as amended
and supplemented from time to time.

                                      -10-

<PAGE>

     "SCHEDULED MATURITY DATE" means, with respect to any Class of Notes, the
Scheduled Maturity Date therefor, as specified in Section 2.01(b).

     "SECURITIES ACCOUNT" means the Collection Account which shall be a
"securities account," as defined in [SECTION 8-501 OF THE DELAWARE UCC].

     "SECURITIES ACT" means the Securities Act of 1933, as amended.

     "SECURITIES INTERMEDIARY" means the Note Trustee, acting as a "securities
intermediary," as defined in [SECTION 8-102(A)(14) OF THE DELAWARE UCC].

     "SECURITY ENTITLEMENT" means a "security entitlement" as defined in
[SECTION 8-102(A)(17) OF THE DELAWARE UCC].

     "SERVICING AGREEMENT" means the Transition Property Servicing Agreement
dated as of March __, 2001, between the Note Issuer and the Servicer, as amended
and supplemented from time to time.

     "STANDARD & POOR'S" means Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies, Inc. or its successor.

     "STATE" means any one of the 50 states of the United States of America or
the District of Columbia.

     "STATE TREASURER" means the Treasurer of the State of Connecticut.

     "STATUTE" means Sections 16-245e to and including 16-245k of the
Connecticut General Statutes.

     "SUCCESSOR SERVICER" has the meaning specified in Section 3.07(e).

     "SWAP AGREEMENT" means any interest rate swap agreement entered into by the
Certificate Issuer with respect to any Class of Certificates, including, without
limitation, the ISDA Master Agreement and the related Schedule and Confirmation
between the Certificate Issuer and a swap counterparty, as same may be amended
or supplemented from time to time.

     "SWAP COUNTERPARTY" means, with respect to any Swap Agreement, the swap
counterparty under that Swap Agreement.

     "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 as in force on
the date hereof, unless otherwise specifically provided.

     "UCC" means, unless the context otherwise requires, the Uniform Commercial
Code, as in effect in the relevant jurisdiction, as amended from time to time.

     "UNDERWRITING AGREEMENT" means the Underwriting Agreement dated as of March
__, 2001, among the Seller, the Note Issuer and Lehman Brothers Inc. and Salomon
Smith Barney Inc., as the representatives of the several underwriters named
therein.

                                      -11-

<PAGE>

     "U.S. GOVERNMENT OBLIGATIONS" means direct obligations (or certificates
representing an ownership interest in such obligations) of the United States of
America (including any agency or instrumentality thereof) for the payment of
which the full faith and credit of the United States of America is pledged.

          (b) Except as otherwise specified herein or as the context may
otherwise require, the following terms have the respective meanings set forth in
the Servicing Agreement as in effect on the Issuance Date for all purposes of
this Note Indenture, and the definitions of such terms are equally applicable
both to the singular and plural forms of such terms:

                        Term                                      Section of
                                                             Servicing Agreement

Advice Letter.........................................          Section 1.01
Financing Order.......................................          Section 1.01
Non-Routine Periodic Adjustment.......................          Section 1.01
Principal Balance.....................................          Section 1.01
RRB Charge............................................          Section 1.01
RRB Charge Collections................................          Section 1.01
RRB Charge Payments...................................          Section 1.01
Seller................................................          Section 1.01
Servicer..............................................          Section 1.01
Servicer Default......................................          Section 1.01
Servicing Fee.........................................          Section 1.01
Transition Property...................................          Section 1.01

     Section 1.02.  INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT. Whenever
this Note Indenture refers to a provision of the Trust Indenture Act, the
provision is incorporated by reference in and made a part of this Note
Indenture. The following Trust Indenture Act terms used in this Note Indenture
have the following meanings:

     "indenture securities" means the Notes.

     "indenture security holder" means a Noteholder.

     "indenture to be qualified" means this Note Indenture.

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

     "obligor" on the indenture securities means the Note Issuer and any other
obligor on the indenture securities.

                                      -12-

<PAGE>

     All other Trust Indenture Act terms used in this Note Indenture that are
defined by the Trust Indenture Act, defined by Trust Indenture Act reference to
another statute or defined by Commission rule have the meanings assigned to them
by such definitions.

     Section 1.03.  RULES OF CONSTRUCTION. Unless the context otherwise
requires:

          (a) a term has the meaning assigned to it;

          (b) an accounting term not otherwise defined has the meaning assigned
to it in accordance with generally accepted accounting principles as in effect
from time to time;

          (c) "or" is not exclusive;

          (d) "including" means including without limitation;

          (e) words in the singular include the plural and words in the plural
include the singular;

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

          (g) all references in this Note Indenture to designated "Articles,"
"Sections" and other subdivisions are to the designated Articles, Sections and
other subdivisions of this Note Indenture.

                                   ARTICLE II

                                    THE NOTES

     Section 2.01.  TERMS OF THE NOTES.

          (a) AUTHORIZATION; DESIGNATION. The issuance of the Notes in an
aggregate initial principal amount of [$________] is hereby authorized and the
Notes shall be designated as the CL&P Funding LLC Notes (the "Notes"), and
further denominated as Classes A-1 through A-[_].

          (b) INITIAL PRINCIPAL AMOUNT; NOTE INTEREST RATE; SCHEDULED MATURITY
DATE; FINAL MATURITY DATE. The Notes of each Class shall have the initial
principal amount, bear interest at the rates per annum and shall have Scheduled
Maturity Dates and Final Maturity Dates as set forth below:

                                      -13-

<PAGE>

   Class   Initial Principal   Note Interest     Scheduled   Final Maturity Date
                 Amount             Rate       Maturity Date
    A-1    $                   %

    A-2

    A-3

    A-4

    A-5

     The Note Interest Rate shall be computed on the basis of a 360-day year of
twelve 30-day months.

     The Notes shall be issuable in not less than Minimum Denominations.

          (c) AUTHENTICATION DATE; PAYMENT DATES; EXPECTED AMORTIZATION SCHEDULE
FOR PRINCIPAL; QUARTERLY INTEREST.

          (i)    AUTHENTICATION DATE. The Notes that are authenticated and
     delivered by the Note Trustee to or upon the order of the Note Issuer on
     March __ 2001 (the "Issuance Date") shall have as their date of
     authentication March __, 2001.

          (ii)    PAYMENT DATES. The Payment Dates for the Notes shall be
     [________ __, _________ ___, ________ ___, and ____________ __] of each
     year or, if any such date is not a Business Day, the next succeeding
     Business Day, commencing on March __, 2001 and continuing until the earlier
     of repayment of the Notes in full or the Final Maturity Date for Class A-5
     of the Notes.

          (iii)  EXPECTED AMORTIZATION SCHEDULE FOR PRINCIPAL. Unless an Event
     of Default shall have occurred and be continuing and the unpaid principal
     amount of all Notes and accrued interest thereon has been declared to be
     due and payable, on each Payment Date, the Note Trustee shall pay to the
     Noteholders of record as of the related Record Date amounts payable
     pursuant to Section 8.02(d) as principal, in the following order and
     priority: (1) to the holders of the Class A-1 Notes, until the Outstanding
     Amount of such Class of Notes thereof has been reduced to zero; (2) to the
     holders of the Class A-2 Notes, until the Outstanding Amount of such Class
     of Notes thereof has been reduced to zero; (3) to the holders of the Class
     A-3 Notes, until the Outstanding Amount of such Class of Notes thereof has
     been reduced to zero; (4) to the holders of the Class A-4 Notes, until the
     Outstanding Amount of such Class of Notes thereof has been reduced to zero;
     and (5) to the holders of the Class A-5 Notes until the Outstanding Amount
     of such Class of Notes thereof has been reduced to zero; provided, however,
     that in no event shall a principal payment pursuant to this Section
     2.01(c)(iii) on any Class on a Payment Date be greater than the amount that

                                      -14-

<PAGE>

     reduces the Outstanding Amount of such Class of Notes to the amount
     specified in the Expected Amortization Schedule. Partial payments of any
     scheduled amortization payment shall be allocated within any Class of Notes
     pro rata.

          (iv) QUARTERLY INTEREST. Quarterly Interest will be payable on each
     Class of Notes on each Payment Date in an amount equal to one-quarter of
     the product of (i) the applicable Note Interest Rate and (ii) the
     Outstanding Amount of the related Class of Notes as of the close of
     business on the preceding Payment Date after giving effect to all payments
     of principal made to the Holders of the related Class of Notes on such
     preceding Payment Date; provided, however, that with respect to the initial
     Payment Date or, if no payment has yet been made, interest on the
     outstanding principal balance will accrue from and including the Issuance
     Date to, but excluding, that Payment Date.

     Section 2.02.  FORM. The Notes and the Note Trustee's certificate of
authentication shall be in substantially the forms set forth in Exhibit A, with
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Note Indenture and may have such letters,
numbers or other marks of identification and such legends or endorsements placed
thereon as may, consistently herewith, be determined by the officers executing
such Notes, as evidenced by their execution of such Notes. Any portion of the
text of any Note may be set forth on the reverse thereof, with an appropriate
reference thereto on the face of the Note.

     The Notes shall be typewritten, printed, lithographed or engraved or
produced by any combination of these methods (with or without steel engraved
borders), all as determined by the officers executing such Notes, as evidenced
by their execution of such Notes.

     The terms of the Notes set forth in Exhibit A are part of the terms of this
Note Indenture.

     Section 2.03.  EXECUTION, AUTHENTICATION AND DELIVERY. The Notes shall be
executed on behalf of the Note Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile.

     Notes bearing the manual or facsimile signature of individuals who were at
any time Authorized Officers of the Note Issuer shall bind the Note Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.

     At any time and from time to time after the execution and delivery of this
Note Indenture, the Note Issuer may deliver Notes executed by the Note Issuer to
the Note Trustee pursuant to an Issuer Order for authentication; and the Note
Trustee shall authenticate and deliver such Notes as in this Note Indenture
provided and not otherwise.

     No Note shall be entitled to any benefit under this Note Indenture or be
valid or obligatory for any purpose, unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Note Trustee by the manual signature of one of its authorized
signatories, and such certificate upon any Note shall be conclusive evidence,
and the only evidence, that such Note has been duly authenticated and delivered
hereunder.

                                      -15-

<PAGE>

     Section 2.04.  TEMPORARY NOTES. Pending the preparation of definitive
Notes, the Note Issuer may execute, and upon receipt of an Issuer Order the Note
Trustee shall authenticate and deliver, temporary Notes which are printed,
lithographed, typewritten, mimeographed or otherwise produced, of the tenor of
the definitive Notes in lieu of which they are issued and with such variations
not inconsistent with the terms of this Note Indenture as the officers executing
such Notes may determine, as evidenced by their execution of such Notes.

     If temporary Notes are issued, the Note Issuer will cause definitive Notes
to be prepared without unreasonable delay. After the preparation of definitive
Notes, the temporary Notes shall be exchangeable for definitive Notes upon
surrender of the temporary Notes at the office or agency of the Note Issuer to
be maintained as provided in Section 3.02, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Notes, the Note Issuer
shall execute and the Note Trustee shall authenticate and deliver in exchange
therefor a like principal amount of definitive Notes of Minimum Denominations.
Until so exchanged, the temporary Notes shall in all respects be entitled to the
same benefits under this Note Indenture as definitive Notes.

     Section 2.05.  REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE. The
Note Issuer shall cause to be kept a register (the "Note Register") in which,
subject to such reasonable regulations as it may prescribe, the Note Issuer
shall provide for the registration of Notes and the registration of transfers of
Notes. The Note Trustee shall be "Note Registrar" for the purpose of registering
Notes and transfers of Notes as herein provided and shall keep and maintain the
Note Register on behalf of the Note Issuer. Upon any resignation of any Note
Registrar, the Note Issuer shall promptly appoint a successor or, if it elects
not to make such an appointment, assume the duties of Note Registrar.

     If a Person other than the Note Trustee is appointed by the Note Issuer as
Note Registrar, the Note Issuer will give the Note Trustee prompt written notice
of the appointment of such Note Registrar and of the location, and any change in
the location, of the Note Register, and the Note Trustee shall have the right to
inspect the Note Register at all reasonable times and to obtain copies thereof,
and the Note Trustee shall have the right to rely upon a certificate executed on
behalf of the Note Registrar by a Responsible Officer thereof as to the names
and addresses of the Holders of the Notes and the principal amounts and number
of such Notes.

     Upon surrender for registration of transfer of any Note at the office or
agency of the Note Issuer to be maintained as provided in Section 3.02, the Note
Issuer shall execute, and the Note Trustee shall authenticate and the Noteholder
shall obtain from the Note Trustee, in the name of the designated transferee or
transferees, one or more new Notes in any Minimum Denominations, of a like Class
and aggregate principal amount.

     At the option of the Holder, Notes may be exchanged for other Notes in any
Minimum Denominations, of a like Class and aggregate principal amount, upon
surrender of the Notes to be exchanged at such office or agency. Whenever any
Notes are so surrendered for exchange, the Note Issuer shall execute, and the
Note Trustee shall authenticate and the Noteholder shall obtain from the Note
Trustee, the Notes which the Noteholder making the exchange is entitled to
receive.

                                      -16-

<PAGE>

     All Notes issued upon any registration of transfer or exchange of Notes
shall be the valid obligations of the Note Issuer, evidencing the same debt, and
entitled to the same benefits under this Note Indenture, as the Notes
surrendered upon such registration of transfer or exchange.

     Every Note presented or surrendered for registration of transfer or
exchange shall be duly endorsed by, or be accompanied by (a) a written
instrument of transfer in form satisfactory to the Note Trustee duly executed by
the Holder thereof or such Holder's attorney duly authorized in writing, with
such signature guaranteed by an institution which is a member of one of the
following recognized Signature Guaranty Programs: (i) The Securities Transfer
Agent Medallion Program (STAMP); (ii) The New York Stock Exchange Medallion
Program (MSP); (iii) The Stock Exchange Medallion Program (SEMP); or (iv) in
such other guarantee program acceptable to the Note Trustee, and (b) such other
documents as the Note Trustee may require.

     No service charge shall be made to a Holder for any registration of
transfer or exchange of Notes, but the Note Issuer may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Notes, other than
exchanges pursuant to Section 2.04 not involving any transfer.

     The preceding provisions of this Section notwithstanding, the Note Issuer
shall not be required to make and the Note Registrar need not register transfers
or exchanges of Notes selected for redemption or of any Note for a period of 15
days preceding the due date for any payment with respect to the Note.

     Section 2.06.  MUTILATED, DESTROYED, LOST OR STOLEN NOTES. If (i) any
mutilated Note is surrendered to the Note Trustee, or the Note Trustee receives
evidence to its satisfaction of the destruction, loss or theft of any Note, and
(ii) there is delivered to the Note Trustee such security or indemnity as may be
required by it to hold the Note Issuer and the Note Trustee harmless, then, in
the absence of notice to the Note Issuer, the Note Registrar or the Note Trustee
that such Note has been acquired by a protected purchaser, the Note Issuer shall
execute and, upon its request, the Note Trustee shall authenticate and deliver,
in exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Note, a replacement Note of like Class, tenor and principal amount, bearing a
number not contemporaneously outstanding; provided, however, that if any such
destroyed, lost or stolen Note, but not a mutilated Note, shall have become or
within seven days shall be due and payable, or shall have been called for
redemption, instead of issuing a replacement Note, the Note Issuer may pay such
destroyed, lost or stolen Note when so due or payable or upon the Optional
Redemption Date or Mandatory Redemption Date, as applicable, without surrender
thereof. If, after the delivery of such replacement Note or payment of a
destroyed, lost or stolen Note pursuant to the proviso to the preceding
sentence, a protected purchaser of the original Note in lieu of which such
replacement Note was issued presents for payment such original Note, the Note
Issuer and the Note Trustee shall be entitled to recover such replacement Note
(or such payment) from the Person to whom it was delivered or any Person taking
such replacement Note from such Person to whom such replacement Note was
delivered or any assignee of such Person, except a protected purchaser, and
shall be entitled to recover upon the security or indemnity provided therefor to
the extent of any loss, damage, cost or expense incurred by the Note Issuer or
the Note Trustee in connection therewith.

                                      -17-

<PAGE>

     Upon the issuance of any replacement Note under this Section, the Note
Issuer may require the payment by the Holder of such Note of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Note Trustee) connected therewith.

     Every replacement Note issued pursuant to this Section in replacement of
any mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Note Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Note Indenture equally
and proportionately with any and all other Notes duly issued hereunder.

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

     Section 2.07.  PERSONS DEEMED OWNER. Prior to due presentment for
registration of transfer of any Note, the Note Issuer, the Note Trustee and any
agent of the Note Issuer or the Note Trustee may treat the Person in whose name
any Note is registered (as of the day of determination) as the owner of such
Note for the purpose of receiving payments of principal of and interest on such
Note and for all other purposes whatsoever, whether or not such Note be overdue,
and neither the Note Issuer, the Note Trustee nor any agent of the Note Issuer
or the Note Trustee shall be affected by notice to the contrary.

     Section 2.08.  PAYMENT OF PRINCIPAL AND INTEREST; INTEREST ON OVERDUE
PRINCIPAL; PRINCIPAL AND INTEREST RIGHTS PRESERVED.

          (a) Any installment of interest or principal payable on any Note which
is punctually paid or duly provided for by the Note Issuer on the applicable
Payment Date shall be paid to the Person in whose name such Note (or one or more
Predecessor Notes) is registered on the Record Date for such Payment Date, by
check mailed first-class, postage prepaid to such Person's address as it appears
on the Note Register on such Record Date, except that with respect to Notes
registered on the Record Date in the name of the Certificate Trustee payments
will be made by wire transfer in immediately available funds to the account
designated by the Certificate Trustee and except for the final installment of
principal payable with respect to such Note on a Payment Date which shall be
payable as provided below. The funds represented by any such checks returned
undelivered shall be held in accordance with Section 3.03 hereof.

          (b) The principal of each Note of each Class shall be paid, to the
extent funds are available therefor in the Collection Account, in installments
on each Payment Date specified in Section 2.01. Notwithstanding the foregoing,
the entire unpaid principal amount of the Notes shall be due and payable, if not
previously paid, on the date on which an Event of Default shall have occurred
and be continuing, if the Note Trustee or the Holders of the Notes representing
not less than a majority of the Outstanding Amount of the Notes have declared
the Notes to be immediately due and payable in the manner provided in Section
5.02. In such event, all payments of principal on the Notes shall be made pro
rata. The Note Trustee shall notify the Person in whose name a Note is
registered at the close of business on the Record Date preceding the Payment
Date on which the Note Issuer expects that the final installment of principal of

                                      -18-

<PAGE>

and interest on such Note will be paid. Such notice shall be mailed no later
than five days prior to such final Payment Date and shall specify that such
final installment will be payable only upon presentation and surrender of such
Note and shall specify the place where such Note may be presented and
surrendered for payment of such installment. Notices in connection with
redemptions of Notes shall be mailed to Noteholders as provided in Section 10.02
or 10.05, as applicable.

          (c) If the Note Issuer defaults in a payment of interest on the Notes
when due, the Note Issuer shall be required to pay such defaulted interest (plus
interest on such defaulted interest at the applicable Note Interest Rate to the
extent lawful) to the Persons who are Noteholders on a subsequent special record
date, which date shall be at least five Business Days prior to the payment date.
The Note Issuer shall fix or cause to be fixed any such special record date and
payment date, and, at least 20 days before any such special record date, the
Note Issuer shall mail to each affected Noteholder a notice that states the
special record date, the payment date and the amount of defaulted interest (plus
interest on such defaulted interest) to be paid.

     Section 2.09.  CANCELLATION. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Note Trustee, be delivered to the Note Trustee and shall
be promptly cancelled by the Note Trustee. The Note Issuer may at any time
deliver to the Note Trustee for cancellation any Notes previously authenticated
and delivered hereunder which the Note Issuer may have acquired in any manner
whatsoever, and all Notes so delivered shall be promptly cancelled by the Note
Trustee. No Notes shall be authenticated in lieu of or in exchange for any Notes
cancelled as provided in this Section, except as expressly permitted by this
Note Indenture. All cancelled Notes may be held or disposed of by the Note
Trustee in accordance with its standard retention or disposal policy as in
effect at the time.

     Section 2.10.  AUTHENTICATION AND DELIVERY OF NOTES. On the Issuance Date,
the Notes shall be executed by the Note Issuer and delivered to the Note Trustee
for authentication and thereupon the same shall be authenticated and delivered
by the Note Trustee upon Issuer Request and upon delivery by the Note Issuer to
the Note Trustee, and receipt by the Note Trustee, or the causing to occur by
the Note Issuer, of the following:

          (a) NOTE ISSUER ACTION. An Issuer Order authorizing and directing the
authentication and delivery of the Notes by the Note Trustee and specifying the
principal amount of Notes to be authenticated.

          (b) AUTHORIZATIONS.

          (i)    An Opinion of Counsel that no authorization, approval or
     consent of any Connecticut, Delaware or federal governmental body or bodies
     at the time having jurisdiction in the premises is required to be obtained
     by the Note Issuer for the valid issuance, authentication and delivery of
     such Notes, except for such registrations as are required under the blue
     sky and securities laws of any State or such authorizations, approvals or
     consents of governmental bodies that have been obtained.

                                      -19-

<PAGE>

          (ii)    An Opinion of Counsel that no authorization, approval or
     consent of any Connecticut, Delaware or federal governmental body or bodies
     at the time having jurisdiction in the premises is required for the valid
     execution and delivery by the Note Issuer of each of the Basic Documents to
     which the Note Issuer is a party, except for such authorizations, approvals
     or consents of governmental bodies that have been obtained.

          (c) AUTHORIZING CERTIFICATE. A certificate of an Authorized Officer of
the Note Issuer certifying that the Note Issuer has duly authorized the
execution and delivery of this Note Indenture and the execution, authentication
and delivery of the Notes.

          (d) THE COLLATERAL. The Note Issuer shall have caused all Collateral
to have been Granted to the Note Trustee or, if requested by the Note Trustee,
its nominee and will have caused all related filings with the DPUC pursuant to
the Statute, the Connecticut UCC, the Delaware UCC and such other filings in
connection with such Grant to have been duly made.

          (e) CERTIFICATES OF THE NOTE ISSUER AND THE SELLER.

          (i)    An Officer's Certificate from the Note Issuer, dated as of the
     Issuance Date to the effect that:

          (a) the Note Issuer is not in Default under this Note Indenture and
that the issuance of the Notes applied for will not result in any Default or in
any material breach of any of the terms, conditions or provisions of or
constitute a default under any material indenture, mortgage, deed of trust or
other agreement or instrument to which the Note Issuer is a party or by which it
or its property is bound or any order of any court or administrative agency
entered in any Proceeding to which the Note Issuer is a party or by which it or
its property may be bound or to which it or its property may be subject;

          (b) all conditions precedent provided in this Note Indenture relating
to the authentication and delivery of the Notes applied for have been complied
with;

          (c) all instruments furnished to the Note Trustee pursuant to this
Note Indenture conform to the requirements set forth in this Note Indenture and
constitute all of the documents required to be delivered hereunder for the Note
Trustee to authenticate and deliver the Notes applied for, and all conditions
precedent provided for in this Note Indenture relating to the authentication and
delivery of the Notes have been complied with;

          (d) the Note Issuer has not assigned any interest or participation in
the Collateral except for the lien of this Note Indenture and of the Statute;

          (e) the Note Issuer has the power and right to Grant the Collateral to
the Note Trustee as security hereunder; and the Note Issuer, subject to the
terms of this Note Indenture, has Granted to the Note Trustee all of its right,
title and interest in and to such Collateral free and clear of any lien,
mortgage, pledge, charge, security interest, adverse claim or other encumbrance
arising as a result of actions of the Note Issuer or through the Note Issuer,
except the lien of this Note Indenture and of the Statute;

                                      -20-

<PAGE>

          (f) the Note Issuer has appointed a firm of Independent certified
public accountants as contemplated in Section 8.06 hereof;

          (g) attached thereto are duly executed, true and complete copies of
the Sale Agreement and the Servicing Agreement; and

          (h) all filings with the DPUC pursuant to the Statute and all UCC
financing statements with respect to the Collateral which are required to be
filed by the terms of the Sale Agreement, the Servicing Agreement or this Note
Indenture have been filed as required.

          (ii)   An Officer's Certificate (as defined in the Sale Agreement)
     from the Seller, dated as of the Issuance Date, to the effect that (a) the
     representations and warranties set forth in Article III of the Sale
     Agreement are true and correct and (b) the attached copies of the Financing
     Order and Issuance Advice Letter creating the Transition Property are true
     and correct.

          (f) OPINION OF COUNSEL. An Opinion of Counsel, portions of which may
be delivered by counsel for the Note Issuer, portions of which may be delivered
by counsel for the Seller and the Servicer, and portions of which may be
delivered by counsel for the Certificate Issuer, dated the Issuance Date, in
each case subject to the customary exceptions, qualifications and assumptions
contained therein, to the collective effect that:

          (i)    the Note Indenture has been duly qualified under the Trust
     Indenture Act;

          (ii)   the Note Issuer has the limited liability company power and
     authority to execute and deliver this Note Indenture and to issue the
     Notes, and this Note Indenture and the Notes have been duly authorized and
     the Note Issuer is duly formed and is validly existing in good standing
     under the laws of the jurisdiction of its organization;

          (iii)  the Note Indenture has been duly authorized, executed and
     delivered by the Note Issuer;

          (iv)   the Notes applied for have been duly authorized and executed
     and, when authenticated in accordance with the provisions of the Note
     Indenture and delivered against payment of the purchase price therefor,
     will constitute valid and binding obligations of the Note Issuer, entitled
     to the benefits of the Note Indenture subject to bankruptcy, insolvency,
     reorganization, moratorium, fraudulent transfer and other laws relating to
     or affecting the rights of creditors generally and general principles of
     equity (regardless of whether such enforceability is considered in a
     proceeding in equity or at law);

          (v)    this Note Indenture, the Sale Agreement, the Servicing
     Agreement and the Fee and Indemnity Agreement are valid and binding
     agreements of the Note Issuer, enforceable in accordance with their
     respective terms, except as such enforceability against the Note Issuer may
     be subject to bankruptcy, insolvency, reorganization, moratorium,
     fraudulent transfer and other laws relating to or affecting the rights of
     creditors generally and general principles of equity (regardless of whether
     such enforceability is considered in a proceeding in equity or at law);

                                      -21-

<PAGE>

          (vi)   (A) (I) under Section 16-245k(a) of the Statute, the provisions
     of this Note Indenture are sufficient to create in favor of the Note
     Trustee a security interest in all right, title and interest of the Note
     Issuer in the Transition Property, (II) the Financing Order authorizes the
     RRB Charge included in the Transition Property, (III) upon the giving of
     value by the Note Trustee with respect to the aforesaid security interest
     in Transition Property under this Note Indenture, the security interest in
     Transition Property shall attach to the Transition Property, (IV) financing
     statements which describe the Transition Property by reference to the
     Financing Order have been presented for filing, and all filing fees
     required in connection therewith have been paid in accordance with part 4
     of article 9 of the Connecticut UCC in the offices of the Secretary of the
     State of Connecticut, and (V) under Section 16-245k(b) of the Statute, such
     filings are sufficient to perfect the security interest granted by this
     Note Indenture in the Transition Property, which security interest is valid
     and enforceable against the Note Issuer (subject to (x) the rights of any
     third parties holding security interests in the Transition Property
     perfected in the manner described in Sections 16-245k of the Statute prior
     to perfection by filing of the security interest granted under this Note
     Indenture and (y) rights arising under the first priority lien arising
     under Section 16-245k(g) of the Statute described in clause (B) of this
     Section 2.10(f)(vi)); (B) (I) by operation of Section 16-245k(g) thereof,
     the Statute creates, upon the effective date of the Financing Order, a
     first priority lien on all Transition Property securing all obligations,
     then existing or subsequently arising, to the Certificateholders in respect
     of such Certificates or to the Certificate Trustee in its capacity as such,
     and any other entity specified in the Financing Order including the Note
     Issuer and the Certificate Issuer, (II) upon the effectiveness of the
     Financing Order, the aforesaid first priority lien shall be valid,
     perfected and enforceable against the Note Issuer and all third parties
     without any further public notice, and (III) the Statute provides that
     conflicting first priority liens on Transition Property arising under
     Section 16-245k(g) of the Statute rank in order of time of perfection; and
     (C) (I) the provisions of this Note Indenture are sufficient to create in
     favor of the Note Trustee a security interest under article 9 of the
     Connecticut UCC in the right, title and interest of the Note Issuer in
     respect of the Sale Agreement, the Servicing Agreement, the Administration
     Agreement and all accounts, general intangibles, equipment and inventory
     (the "UCC Collateral") of the Note Issuer, (II) upon the giving of value by
     the Note Trustee with respect to the aforesaid security interests in the
     Collateral under this Note Indenture, the security interest in such UCC
     Collateral shall attach to the UCC Collateral, (III) financing statements
     which describe the UCC Collateral have been presented for filing and all
     filing fees required in connection therewith have been paid in accordance
     with article 9 of the Connecticut UCC in the offices of the Secretary of
     the State of Connecticut, (IV) such filings are sufficient to perfect the
     security interest granted by this Note Indenture in the UCC Collateral,
     which security interest is valid and enforceable against the Note Issuer
     (subject to the rights of any third parties holding security interests in
     the UCC Collateral perfected in the manner described in article 9 of the
     Connecticut UCC prior to perfection by filing of the security interest
     therein granted under this Note Indenture);

          (vii)  either (A) the registration statement covering the Notes and
     the Certificates is effective under the Securities Act and, to the best of
     such counsel's knowledge and information, no stop order suspending the
     effectiveness of such registration statement has been issued under the
     Securities Act and no proceedings for that purpose have been initiated or

                                      -22-

<PAGE>

     are pending or threatened by the Commission or (B) the Notes and the
     Certificates are exempt from the registration requirements under the
     Securities Act;

          (viii) the Note Issuer is not an "investment company" or under the
     "control" of an "investment company" as such terms are defined under the
     Investment Company Act of 1940, as amended;

          (ix)   the Sale Agreement is a valid and binding agreement of the
     Seller enforceable against the Seller in accordance with its terms except
     as such enforceability may be subject to bankruptcy, insolvency,
     reorganization, moratorium, fraudulent transfer and other laws relating to
     or affecting the rights of creditors generally and general principles of
     equity (regardless of whether such enforcement is considered in a
     proceeding in equity or at law);

          (x)    the Servicing Agreement is a valid and binding agreement of the
     Servicer enforceable against the Servicer in accordance with its terms
     except as such enforceability may be subject to bankruptcy, insolvency,
     reorganization, moratorium, fraudulent transfer and other laws relating to
     or affecting the rights of creditors generally and general principles of
     equity (regardless of whether such enforcement is considered in a
     proceeding in equity or at law);

          (xi)   upon the delivery of the fully executed Sale Agreement to the
     Note Issuer and the payment of the purchase price of the Transition
     Property by the Note Issuer to the Seller pursuant to the Sale Agreement,
     then (A) the transfer of the Transition Property by the Seller to the Note
     Issuer pursuant to the Sale Agreement conveys the Seller's right, title and
     interest in the Transition Property to the Note Issuer and will be treated
     under the laws of the State of Connecticut as an absolute transfer of all
     of the Seller's right, title, and interest in the Transition Property,
     other than for federal and state income and franchise tax purposes and
     notwithstanding any contrary treatment of such transfer for accounting
     purposes, (B) such transfer of the Transition Property is perfected, (C) a
     financing statement has been filed in favor of the Note Issuer that
     describes the Transition Property by reference to the Financing Order, in
     accordance with Section 16-245k(j) of the Statute and (D) assuming that the
     Note Issuer does not have notice or knowledge of any conflicting assignment
     of the Transition Property, the transfer of the Transition Property to the
     Note issuer will have priority over any other assignment of the Transition
     Property;

          (xii)  (A) the Financing Order has been duly issued and authorized by
     the DPUC and the Financing Order, giving effect to the Issuance Advice
     Letter, is effective; (B) in reliance on the opinion of Pullman & Comley
     LLC that the Certificates are "rate reduction bonds" under Section
     16-245e(a)(1) of the Statute, as of the issuance of the Certificates, the
     Certificates are entitled to the protections provided in Sections
     16-245i(b) and 16-245j(b) of the Statute; (C) the Financing Order is no
     longer subject to appeal by any person in state courts of the State of
     Connecticut; and (D) the Servicer is authorized to file periodic RRB Charge
     adjustments to the extent necessary to ensure the timely recovery of
     revenues sufficient to provide for the payment of an amount equal to the
     sum of the periodic RRB payment requirements for the upcoming year, which
     includes indemnity obligations under the Basic Documents;

                                      -23-

<PAGE>

          (xiii) any state action (whether by legislative, DPUC, or otherwise)
     to revoke or limit the Financing Order, the Issuance Advice Letter, the
     Transition Property or the RRB Charge in a manner which would substantially
     impair the rights of Certificateholders would be subject to a successful
     constitutional contracts or takings clause defense; and

          (xiv)  such other matters as the Note Trustee may reasonably require.

          (g) ACCOUNTANT'S LETTER. A letter addressed to the Note Issuer and the
Note Trustee complying with the requirements of Section 11.01(a) hereof, of a
firm of Independent certified public accountants of recognized national
reputation to the effect that (a) such accountants are Independent with respect
to the Note Issuer within the meaning of the Note Indenture, and are independent
public accountants within the meaning of the standards of The American Institute
of Certified Public Accountants, and (b) with respect to the Collateral, they
have made certain specified recalculations of calculations and information
provided by the underwriters for the purpose of determining that, based on
certain specified assumptions used in calculating estimated collections based on
the initial RRB Charge, as of the Issuance Date such estimated collections based
on the initial RRB Charge are sufficient to pay (a) assumed Operating Expenses
when incurred, plus (b) the Overcollateralization Amount set forth in the Final
Prospectus (as such term is defined in the Underwriting Agreement), plus (c)
interest on the Notes at their respective Note Interest Rates when due as set
forth in the Final Prospectus, plus (d) principal of the Notes in accordance
with the Expected Amortization Schedule set forth in the Final Prospectus and
found the calculations to be mathematically correct.

          (h) RATINGS ON THE CERTIFICATES. The Note Trustee shall receive
evidence reasonably satisfactory to it that the Certificates shall have been
rated AAA by Standard & Poor's, Aaa by Moody's, and AAA by Fitch, or, in each
case, the equivalent.

          (i) OTHER REQUIREMENTS. Such other documents, certificates,
agreements, instruments or opinions as the Note Trustee may reasonably require.

     Section 2.11.  RELEASE OF COLLATERAL. Subject to Section 11.01, the Note
Trustee shall release property from the lien of this Note Indenture only as
specified in Section 8.02 or upon receipt of an Issuer Request accompanied by an
Officer's Certificate, an Opinion of Counsel and Independent Certificates in
accordance with Trust Indenture Act ss.ss. 314(c) and 314(d)(l) or an Opinion of
Counsel in lieu of such Independent Certificates to the effect that the Trust
Indenture Act does not require any such Independent Certificates.

                                  ARTICLE III

                                    COVENANTS

     Section 3.01.  PAYMENT OF PRINCIPAL AND INTEREST. The Note Issuer will duly
and punctually pay the principal of and interest on the Notes in accordance with
the terms of the Notes and this Note Indenture. Amounts properly withheld under
the Code by any Person from a payment to any Noteholder of interest or principal
shall be considered as having been paid by the Note Issuer to such Noteholder
for all purposes of this Note Indenture.

                                      -24-

<PAGE>

     Section 3.02.  MAINTENANCE OF OFFICE OR AGENCY. The Note Issuer will
maintain in the Borough of Manhattan, The City of New York, an office or agency
where Notes may be surrendered for registration of transfer or exchange. The
Note Issuer hereby initially appoints the Note Trustee to serve as its agent for
the foregoing purposes. The Note Issuer will give prompt written notice to the
Note Trustee of the location, and of any change in the location, of any such
office or agency. If at any time the Note Issuer shall fail to maintain any such
office or agency or shall fail to furnish the Note Trustee with the address
thereof, such surrenders may be made at the Corporate Trust Office, and the Note
Issuer hereby appoints the Note Trustee as its agent to receive all such
surrenders.

     Section 3.03.  MONEY FOR PAYMENTS TO BE HELD IN TRUST. As provided in
Section 8.02(a), all payments of amounts due and payable with respect to any
Notes that are to be made from amounts withdrawn from the Collection Account
pursuant to Section 8.02(d) shall be made on behalf of the Note Issuer by the
Note Trustee or by another Paying Agent, and no amounts so withdrawn from the
Collection Account for payments of Notes shall be paid over to the Note Issuer
except as provided in this Section and Section 8.02.

     The Note Issuer will cause each Paying Agent other than the Note Trustee to
execute and deliver to the Note Trustee an instrument in which such Paying Agent
shall agree with the Note Trustee (and if the Note Trustee acts as Paying Agent,
it hereby so agrees), subject to the provisions of this Section, that such
Paying Agent will:

          (a) hold all sums held by it for the payment of amounts due with
respect to the Notes in trust for the benefit of the Persons entitled thereto
until such sums shall be paid to such Persons or otherwise disposed of as herein
provided and pay such sums to such Persons as herein provided;

          (b) give the Note Trustee and the Certificate Trustee notice of any
Default by the Note Issuer (or any other obligor upon the Notes) of which it has
actual knowledge in the making of any payment required to be made with respect
to the Notes;

          (c) at any time during the continuance of any such Default, upon the
written request of the Note Trustee, forthwith pay to the Note Trustee all sums
so held in trust by such Paying Agent;

          (d) immediately resign as a Paying Agent and forthwith pay to the Note
Trustee all sums held by it in trust for the payment of Notes if at any time it
ceases to meet the standards required to be met by a Paying Agent at the time of
its appointment; and

          (e) comply with all requirements of the Code with respect to the
withholding from any payments made by it on any Notes of any applicable
withholding taxes imposed thereon and with respect to any applicable reporting
requirements in connection therewith.

     The Note Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Note Indenture or for any other purpose, by
Issuer Order direct any Paying Agent to pay to the Note Trustee all sums held in

                                      -25-

<PAGE>

trust by such Paying Agent, such sums to be held by the Note Trustee upon the
same trusts as those upon which the sums were held by such Paying Agent; and
upon such payment by any Paying Agent to the Note Trustee, such Paying Agent
shall be released from all further liability with respect to such money.

     Subject to applicable laws with respect to escheat of funds, any money held
by the Note Trustee or any Paying Agent in trust for the payment of any amount
due with respect to any Note and remaining unclaimed for two years after such
amount has become due and payable shall be discharged from such trust and be
paid to the Note Issuer on Issuer Request; and, subject to Section 11.16, the
Holder of such Note shall thereafter, as an unsecured general creditor, look
only to the Note Issuer for payment thereof (but only to the extent of the
amounts so paid to the Note Issuer), and all liability of the Note Trustee or
such Paying Agent with respect to such trust money shall thereupon cease;
provided, however, that the Note Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Note Issuer cause
to be published once, in a newspaper published in the English language,
customarily published on each Business Day and of general circulation in The
City of New York, notice that such money remains unclaimed and that, after a
date specified therein, which shall not be less than 30 days from the date of
such publication, any unclaimed balance of such money then remaining will be
repaid to the Note Issuer. The Note Trustee may also adopt and employ, at the
expense of the Note Issuer, any other reasonable means of notification of such
repayment (including mailing notice of such repayment to Holders whose Notes
have been called but have not been surrendered for redemption or whose right to
or interest in moneys due and payable but not claimed is determinable from the
records of the Note Trustee or of any Paying Agent, at the last address of
record for each such Holder).

     Section 3.04.  EXISTENCE. The Note Issuer will keep in full effect its
existence, rights and franchises as a limited liability company under the laws
of the State of Delaware (unless, subject to the provisions of Section 3.10
hereof, it becomes, or any successor Note Issuer hereunder is or becomes,
organized under the laws of any other State or of the United States of America,
in which case the Note Issuer will keep in full effect its existence, rights and
franchises under the laws of such other jurisdiction) and will obtain and
preserve its qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Note Indenture, the Notes, the Collateral and each other
instrument or agreement included in the Collateral.

     Section 3.05.  PROTECTION OF COLLATERAL. The Note Issuer will from time to
time execute and deliver all such supplements and amendments hereto and all such
filings with the DPUC pursuant to the Statute, financing statements,
continuation statements, instruments of further assurance and other instruments,
and will take such other action necessary or advisable to:

          (a) maintain or preserve the lien and security interest (and the
priority thereof) of this Note Indenture or carry out more effectively the
purposes hereof;

          (b) perfect, publish notice of or protect the validity of any Grant
made or to be made by this Note Indenture;

          (c) enforce any of the Collateral;

                                      -26-

<PAGE>

          (d) preserve and defend title to the Collateral and the rights of the
Note Trustee and the Noteholders in such Collateral against the claims of all
Persons and parties, including the challenge by any party to the validity or
enforceability of the Financing Order, any Advice Letter or the Transition
Property or any proceeding relating thereto and institute any action or
proceeding necessary to compel performance by the DPUC or the State of
Connecticut of any of its obligations or duties under the Statute, the Financing
Order or any Advice Letter; or

          (e) pay any and all taxes levied or assessed upon all or any part of
the Collateral.

     The Note Issuer hereby designates the Note Trustee its agent and
attorney-in-fact to execute any filings with the DPUC pursuant to the Statute,
financing statement, continuation statement or other instrument required by the
Note Trustee pursuant to this Section, it being understood that the Note Trustee
shall have no such obligation. The Note Trustee agrees not to execute any such
filing (other than UCC financing statements, continuation statements or
amendments) prior to a Default unless the Note Issuer shall have failed to make
any such filing on a timely basis, which shall mean at least five Business Days
prior to the expiration date for such filing.

     Section 3.06.  OPINIONS AS TO COLLATERAL.

          (a) On the Issuance Date, the Note Issuer shall furnish to the Note
Trustee an Opinion of Counsel either stating that, in the opinion of such
counsel, (i) such action has been taken (and reciting the details of such
action) with respect to the recording and filing of this Note Indenture and any
other requisite documents, and with respect to the execution and filing of any
filings with the DPUC pursuant to the Statute, financing statements and
continuation statements, as are necessary to perfect the lien and security
interest of this Note Indenture, or (ii) no such action is necessary to make
such lien and security interest effective.

          (b) Prior to the effectiveness of any amendment to the Sale Agreement,
the Note Issuer shall furnish to the Note Trustee an Opinion of Counsel either
(i) stating that, in the opinion of such counsel, all filings, including filings
with the DPUC pursuant to the Statute and any UCC financing statements, have
been executed and filed that are necessary fully to preserve and protect the
interest of the Note Issuer and the Note Trustee in the Transition Property and
the proceeds thereof, and reciting the details of such filings or referring to
prior Opinions of Counsel in which such details are given, or (ii) stating that,
in the opinion of such counsel, no such action shall be necessary to preserve
and protect such interest.

     Section 3.07.  PERFORMANCE OF OBLIGATIONS; SERVICING; COMMISSION FILINGS.

          (a) The Note Issuer (i) will diligently pursue any and all actions to
enforce its rights under each instrument or agreement included in the Collateral
and (ii) will not take any action and will use its reasonable efforts not to
permit any action to be taken by others that would release any Person from any
of such Person's covenants or obligations under any such instrument or agreement
or that would result in the amendment, hypothecation, subordination, termination
or discharge of, or impair the validity or effectiveness of, any such instrument

                                      -27-

<PAGE>

or agreement, except, in each case, as expressly permitted in this Note
Indenture, the Sale Agreement, the Servicing Agreement or such other instrument
or agreement.

          (b) The Note Issuer may contract with other Persons to assist it in
performing its duties under this Note Indenture, and any performance of such
duties by a Person identified to the Note Trustee in an Officer's Certificate of
the Note Issuer shall be deemed to be action taken by the Note Issuer.
Initially, the Note Issuer has contracted with the Administrator and the
Servicer to assist the Note Issuer in performing its duties under this Note
Indenture.

          (c) The Note Issuer will punctually perform and observe all of its
obligations and agreements contained in this Note Indenture, the Basic Documents
and in the instruments and agreements included in the Collateral, including
filing or causing to be filed all filings with the DPUC pursuant to the Statute,
UCC financing statements and continuation statements required to be filed by it
by the terms of this Note Indenture, the Sale Agreement and the Servicing
Agreement in accordance with and within the time periods provided for herein and
therein. Except as otherwise expressly permitted therein, the Note Issuer shall
not waive, amend, modify, supplement or terminate any Basic Document or any
provision thereof without the written consent of the Note Trustee (which consent
shall not be withheld if (i) the Note Trustee shall have received an Officer's
Certificate stating that such waiver, amendment, modification, supplement or
termination shall not adversely affect in any material respect the interests of
the Noteholders or the holders of Certificates and (ii) the Rating Agency
Condition shall have been satisfied with respect thereto) or the Holders of at
least a majority of the Outstanding Amount of Notes.

          (d) If the Note Issuer shall have knowledge of the occurrence of a
Servicer Default under the Servicing Agreement, the Note Issuer shall promptly
give written notice thereof to the Note Trustee, the Certificate Trustee, the
Finance Authority and the Rating Agencies, and shall specify in such notice the
action, if any, the Note Issuer is taking with respect to such default. If a
Servicer Default shall arise from the failure of the Servicer to perform any of
its duties or obligations under the Servicing Agreement with respect to the
Transition Property, including the RRB Charge, the Note Issuer shall take all
reasonable steps available to it to remedy such failure.

          (e) As promptly as possible after the giving of notice to the
Servicer, the Note Trustee, the Certificate Trustee, the Finance Authority and
the Rating Agencies of termination of the Servicer's rights and powers pursuant
to Section 7.01 of the Servicing Agreement, the Note Issuer, subject to the
approval of the DPUC pursuant to the Financing Order, shall appoint a successor
Servicer (the "Successor Servicer") with the Note Trustee's prior written
consent thereto (which consent shall not be unreasonably withheld), and such
Successor Servicer shall accept its appointment by a written assumption in a
form acceptable to the Note Issuer and the Note Trustee. A Person shall qualify
as a Successor Servicer only if such Person satisfies the requirements of the
Servicing Agreement. If within 30 days after the delivery of the notice referred
to above, the Note Issuer shall not have obtained such a new Servicer, the Note
Trustee may petition the DPUC or a court of competent jurisdiction to appoint a
Successor Servicer. In connection with any such appointment, the Note Issuer may
make such arrangements for the compensation of such successor as it and such
successor shall agree, subject to the limitations set forth below and in the
Servicing Agreement, and in accordance and in compliance with Section 7.02 of

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<PAGE>

the Servicing Agreement, the Note Issuer shall enter into an agreement with such
successor for the servicing of the Transition Property (such agreement to be in
form and substance reasonably satisfactory to the Note Trustee).

          (f) Upon any termination of the Servicer's rights and powers pursuant
to the Servicing Agreement, the Note Trustee shall promptly notify the Note
Issuer, the Noteholders, the Certificate Trustee, the Finance Authority and the
Rating Agencies. As soon as a Successor Servicer is appointed, the Note Issuer
shall notify the Note Trustee, the Noteholders, the Certificate Trustee, the
Finance Authority and the Rating Agencies of such appointment, specifying in
such notice the name and address of such Successor Servicer.

          (g) Without derogating from the absolute nature of the assignment
granted to the Note Trustee under this Note Indenture or the rights of the Note
Trustee hereunder, the Note Issuer agrees that it will not, without the prior
written consent of the Note Trustee (which consent shall not be withheld if (i)
the Note Trustee shall have received an Officer's Certificate stating that such
amendment, modification, waiver, supplement, termination or surrender shall not
adversely affect in any material respect the interests of the Noteholders or the
holders of Certificates and (ii) the Rating Agency Condition shall have been
satisfied with respect thereto) or the Holders of at least a majority in
Outstanding Amount of the Notes, amend, modify, waive, supplement, terminate or
surrender, or agree to any amendment, modification, waiver, supplement,
termination or surrender of, the terms of any Collateral or the Basic Documents,
or waive timely performance or observance of any material term by the Seller or
the Servicer under the Sale Agreement or the Servicing Agreement, respectively.
If any such amendment, modification, supplement or waiver shall be so consented
to by the Note Trustee or such Holders, the Note Issuer agrees to execute and
deliver, in its own name and at its own expense, such agreements, instruments,
consents and other documents as shall be necessary or appropriate in the
circumstances. The Note Issuer agrees that no such amendment, modification,
supplement or waiver shall adversely affect the rights of the Holders of the
Notes or Certificates Outstanding at the time of any such amendment,
modification, supplement or waiver, except as otherwise agreed to by the Holders
in accordance with the Basic Documents.

          (h) The Note Issuer shall file with the Commission such periodic
reports, if any, as are required from time to time under Section 13 or 15(d) of
the Exchange Act.

          (i) The Note Issuer shall make all filings required under the Statute
relating to the transfer of the ownership or security interest in the Transition
Property other than those required to be made by the Seller pursuant to the
Basic Documents.

     Section 3.08.  NEGATIVE COVENANTS. So long as any Notes are Outstanding,
the Note Issuer shall not:

          (a) except as expressly permitted by this Note Indenture, sell,
transfer, exchange or otherwise dispose of any of the properties or assets of
the Note Issuer, including those included in the Collateral, unless directed to
do so by the Note Trustee in accordance with Article V;

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<PAGE>

          (b) claim any credit on, or make any deduction from the principal or
interest payable in respect of, the Notes (other than amounts properly withheld
from such payments under the Code) or assert any claim against any present or
former Noteholder by reason of the payment of the taxes levied or assessed upon
any part of the Collateral;

          (c) terminate its existence or dissolve or liquidate in whole or in
part; or

          (d) (i) permit the validity or effectiveness of this Note Indenture to
be impaired, or permit the lien of this Note Indenture to be amended,
subordinated, terminated or discharged, or permit any Person to be released from
any covenants or obligations with respect to the Notes under this Note Indenture
except as may be expressly permitted hereby, (ii) permit any lien, charge,
excise, claim, security interest, mortgage or other encumbrance (other than the
lien of this Note Indenture and any statutory lien under Section 16-245k(g) of
the Statute) to be created by the Note Issuer on or extend to or otherwise arise
upon or burden the Collateral or any part thereof or any interest therein or the
proceeds thereof or (iii) subject to any statutory lien under Section 16-245k(g)
of the Statute, permit the lien of this Note Indenture not to constitute a valid
first priority security interest in the Collateral.

     Section 3.09.  ANNUAL STATEMENT AS TO COMPLIANCE. The Note Issuer will
deliver to the Note Trustee, the Certificate Trustee, the Finance Authority and
the Rating Agencies not later than March 31 of each year (commencing with March
31, 2002), an Officer's Certificate stating, as to the Authorized Officer
signing such Officer's Certificate, that

          (a) a review of the activities of the Note Issuer during the preceding
twelve months ended December 31 (or, in the case of the Officer's Certificate to
be delivered on or before March 31, 2002, the period of time from the date of
this Note Indenture until December 31, 2001), and of performance under this Note
Indenture has been made under such Authorized Officer's supervision; and

          (b) to such Authorized Officer's knowledge, based on such review, the
Note Issuer has complied with all conditions and covenants under this Note
Indenture throughout such twelve month period, or, if there has been a default
in so complying with any such condition or covenant, specifying each such
default known to such Authorized Officer and the nature and status thereof.

     Section 3.10.  NOTE ISSUER MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.

          (a) The Note Issuer shall not consolidate or merge with or into any
other Person, unless

          (i)    the Person (if other than the Note Issuer) formed by or
     surviving such consolidation or merger shall be a Person organized and
     existing under the laws of the United States of America, any State or the
     District of Columbia and shall expressly assume, by an indenture
     supplemental hereto, executed and delivered to the Note Trustee, in form
     and substance reasonably satisfactory to the Note Trustee, the due and
     punctual payment of the principal of and interest on all Notes and the
     performance or observance of every agreement and covenant of this Note
     Indenture on the part of the Note Issuer to be performed or observed, all
     as provided herein;

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<PAGE>

          (ii)   immediately after giving effect to such transaction, no Default
     or Event of Default shall have occurred and be continuing;

          (iii)  the Rating Agency Condition shall have been satisfied with
     respect to such transaction;

          (iv)   the Note Issuer shall have received an Opinion of Counsel (and
     shall have delivered copies thereof to the Note Trustee) to the effect that
     such transaction will not have any material adverse tax consequence to the
     Note Issuer, the Certificate Issuer, any Noteholder or any
     Certificateholder;

          (v)    any action as is necessary to maintain the lien and security
     interest created by this Note Indenture shall have been taken; and

          (vi)   the Note Issuer shall have delivered to the Note Trustee an
     Officer's Certificate and an Opinion of Counsel each stating that such
     consolidation or merger and such supplemental note indenture comply with
     this Section 3.10 and that all conditions precedent herein provided for
     relating to such transaction have been complied with (including any filing
     required by the Exchange Act).

          (b) Except as specifically provided herein, the Note Issuer shall not
convey or transfer any of its properties or assets, including those included in
the Collateral, to any Person, unless

          (i)    the Person that acquires by conveyance or transfer the
     properties and assets of the Note Issuer the conveyance or transfer of
     which is hereby restricted shall (A) be a United States citizen or a Person
     organized and existing under the laws of the United States of America, any
     State or the District of Columbia, (B) expressly assumes, by an indenture
     supplemental hereto, executed and delivered to the Note Trustee, in form
     and substance reasonably satisfactory to the Note Trustee, the due and
     punctual payment of the principal of and interest on all Notes and the
     performance or observance of every agreement and covenant of this Note
     Indenture on the part of the Note Issuer to be performed or observed, all
     as provided herein, (C) expressly agrees by means of such supplemental note
     indenture that all right, title and interest so conveyed or transferred
     shall be subject and subordinate to the rights of Holders of the Notes, (D)
     unless otherwise provided in the supplemental note indenture referred to in
     clause (B) above, expressly agrees to indemnify, defend and hold harmless
     the Note Trustee against and from any loss, liability or expense arising
     under or related to this Note Indenture and the Notes and (E) expressly
     agrees by means of such supplemental note indenture that such Person (or if
     a group of Persons, then one specified Person) shall make all filings with
     the Commission (and any other appropriate Person) required by the Exchange
     Act in connection with the Notes;

          (ii)   immediately after giving effect to such transaction, no Default
     or Event of Default shall have occurred and be continuing;

          (iii)  the Rating Agency Condition shall have been satisfied with
     respect to such transaction;

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<PAGE>

          (iv)   the Note Issuer shall have received an Opinion of Counsel (and
     shall have delivered copies thereof to the Note Trustee) to the effect that
     such transaction will not have any material adverse tax consequence to the
     Note Issuer, the Certificate Issuer, any Noteholder or any
     Certificateholder;

          (v)    any action as is necessary to maintain the lien and security
     interest created by this Note Indenture shall have been taken; and

          (vi)   the Note Issuer shall have delivered to the Note Trustee an
     Officer's Certificate and an Opinion of Counsel each stating that such
     conveyance or transfer and such supplemental note indenture comply with
     this Section 3.10 and that all conditions precedent herein provided for
     relating to such transaction have been complied with (including any filing
     required by the Exchange Act).

     Section 3.11.  SUCCESSOR OR TRANSFEREE.

          (a) Upon any consolidation or merger of the Note Issuer in accordance
with Section 3.10(a), the Person formed by or surviving such consolidation or
merger (if other than the Note Issuer) shall succeed to, and be substituted for,
and may exercise every right and power of, the Note Issuer under this Note
Indenture with the same effect as if such Person had been named as the Note
Issuer herein.

          (b) Except as set forth in Section 6.07, upon a conveyance or transfer
of all the assets and properties of the Note Issuer pursuant to Section 3.10(b),
CL&P Funding LLC will be released from every covenant and agreement of this Note
Indenture to be observed or performed on the part of the Note Issuer with
respect to the Notes immediately upon the delivery of written notice by CL&P
Funding LLC to the Note Trustee stating that CL&P Funding LLC is to be so
released.

     Section 3.12.  NO OTHER BUSINESS. The Note Issuer shall not engage in any
business other than financing, purchasing, owning and managing the Transition
Property in the manner contemplated by this Note Indenture and the Basic
Documents and activities incidental thereto.

     Section 3.13.  NO BORROWING. The Note Issuer shall not issue, incur,
assume, guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for the Notes.

     Section 3.14.  SERVICER'S OBLIGATIONS. The Note Issuer shall enforce the
Servicer's compliance with all of the Servicer's material obligations under the
Servicing Agreement.

     Section 3.15.  NO ADDITIONAL NOTES. The Note Issuer shall not issue any
additional Notes hereunder, except pursuant to Section 2.05 or Section 2.06.

     Section 3.16.  GUARANTEES, LOANS, ADVANCES AND OTHER LIABILITIES. Except as
otherwise contemplated by the Sale Agreement, the Servicing Agreement or this
Note Indenture, the Note Issuer shall not make any loan or advance or credit to,
or guarantee (directly or indirectly or by an instrument having the effect of
assuring another's payment or performance on any obligation or capability of so
doing or otherwise), endorse or otherwise become contingently liable, directly
or indirectly, in connection with the obligations, stocks or dividends of, or

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<PAGE>

own, purchase, repurchase or acquire (or agree contingently to do so) any stock,
obligations, assets or securities of, or any other interest in, or make any
capital contribution to, any other Person.

     Section 3.17.  CAPITAL EXPENDITURES. Other than expenditures in an
aggregate amount not to exceed $25,000 in any calendar year, the Note Issuer
shall not make any expenditure (by long-term or operating lease or otherwise)
for capital assets (either realty or personalty).

     Section 3.18.  NON-ROUTINE PERIODIC ADJUSTMENT. The Note Issuer agrees that
it shall not consent to a Non-Routine Periodic Adjustment pursuant to Section
4.01(c) of the Servicing Agreement unless the Rating Agency Condition shall have
been satisfied.

     Section 3.19.  RESTRICTED PAYMENTS. The Note Issuer shall not, directly or
indirectly, while the Notes are Outstanding (a) pay any dividend or make any
distribution (by reduction of capital or otherwise), whether in cash, property,
securities or a combination thereof, to any owner of a beneficial interest in
the Note Issuer or otherwise with respect to any ownership or equity interest or
security in or of the Note Issuer, (b) redeem, purchase, retire or otherwise
acquire for value any such ownership or equity interest or security or (c) set
aside or otherwise segregate any amounts for any such purpose; provided,
however, that, if no Event of Default shall have occurred and be continuing, the
Note Issuer may make, or cause to be made, any such distributions to any owner
of a beneficial interest in the Note Issuer or otherwise with respect to any
ownership or equity interest or security in or of the Note Issuer using funds
distributed to the Note Issuer pursuant to Section 8.02 to the extent that such
distributions would not cause the amount of the Capital Subaccount to decline
below the Required Capital Level. The Note Issuer will not, directly or
indirectly, make payments to or distributions from the Collection Account except
in accordance with this Note Indenture and the Basic Documents.

     Section 3.20.  NOTICE OF EVENTS OF DEFAULT. The Note Issuer agrees to give
the Note Trustee, the Certificate Trustee, the Finance Authority and the Rating
Agencies prompt written notice of each Event of Default hereunder and each
default on the part of the Seller or the Servicer of its obligations under the
Sale Agreement or the Servicing Agreement, respectively.

     Section 3.21.  FURTHER INSTRUMENTS AND ACTS. Upon request of the Note
Trustee, the Note Issuer will execute and deliver such further instruments and
do such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Note Indenture.

                                   ARTICLE IV

                     SATISFACTION AND DISCHARGE; DEFEASANCE

     Section 4.01.  SATISFACTION AND DISCHARGE OF NOTE INDENTURE; DEFEASANCE.

          (a) This Note Indenture shall cease to be of further effect with
respect to the Notes and the Note Trustee, on reasonable demand of and at the
expense of the Note Issuer, shall execute proper instruments acknowledging
satisfaction and discharge of this Note Indenture with respect to the Notes,
when

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<PAGE>

          (i)    either all Notes theretofore authenticated and delivered (other
     than (A) Notes that have been mutilated, destroyed, lost or stolen and that
     have been replaced or paid as provided in Section 2.06 and (B) Notes for
     whose payment money has theretofore been deposited in trust or segregated
     and held in trust by the Note Issuer and thereafter repaid to the Note
     Issuer or discharged from such trust, as provided in Section 3.03) have
     been delivered to the Note Trustee for cancellation; or the Scheduled
     Maturity Date or Redemption Date has occurred with respect to all Notes not
     theretofore delivered to the Note Trustee for cancellation, and the Note
     Issuer has irrevocably deposited or caused to be irrevocably deposited with
     the Note Trustee cash, in trust for such purpose, in an amount sufficient
     to pay and discharge the entire indebtedness on such Notes not theretofore
     delivered to the Note Trustee for cancellation on the Scheduled Maturity
     Date therefor;

          (ii)   the Note Issuer has paid or caused to be paid all other sums
     payable hereunder by the Note Issuer; and

          (iii)  the Note Issuer has delivered to the Note Trustee an Officer's
     Certificate, an Opinion of Counsel and (if required by the Trust Indenture
     Act or the Note Trustee) an Independent Certificate from a firm of
     certified public accountants, each meeting the applicable requirements of
     Section 11.01(a) and each stating that all conditions precedent herein
     provided for relating to the satisfaction and discharge of this Note
     Indenture with respect to the Notes have been complied with.

          (b) Subject to Sections 4.01(c) and 4.02, the Note Issuer at any time
may terminate (i) all its obligations under this Note Indenture with respect to
the Notes ("Legal Defeasance Option") or (ii) its obligations under Sections
3.04, 3.05, 3.06, 3.07, 3.08, 3.09, 3.10, 3.12, 3.13, 3.14, 3.15, 3.16, 3.17 and
3.18 and the operation of Section 5.01(d) ("Covenant Defeasance Option") with
respect to the Notes. The Note Issuer may exercise the Legal Defeasance Option
notwithstanding its prior exercise of the Covenant Defeasance Option.

     If the Note Issuer exercises the Legal Defeasance Option, the maturity of
the Notes may not be accelerated because of an Event of Default. If the Note
Issuer exercises the Covenant Defeasance Option, the maturity of the Notes may
not be accelerated because of an Event of Default specified in Section 5.01(d).

     Upon satisfaction of the conditions set forth herein to the exercise of the
Legal Defeasance Option or the Covenant Defeasance Option, the Note Trustee, on
reasonable demand of and at the expense of the Note Issuer, shall execute proper
instruments acknowledging satisfaction and discharge of the obligations that are
terminated pursuant to such exercise.

          (c) Notwithstanding Sections 4.01(a) and 4.01(b) above, (i) rights of
registration of transfer and exchange, (ii) substitution of mutilated,
destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive payments
of principal and interest, (iv) Sections 4.03 and 4.04, (v) the rights,
obligations and immunities of the Note Trustee hereunder (including the rights
of the Note Trustee under Section 6.07 and the obligations of the Note Trustee
under Section 4.03) and (vi) the rights of Noteholders as beneficiaries hereof
with respect to the property deposited with the Note Trustee payable to all or
any of them, shall survive until the Notes, as to which this Note Indenture or
certain obligations hereunder have been satisfied and discharged pursuant to
Section 4.01(a) or 4.01(b), have been paid in full. Thereafter, the obligations
in Sections 6.07 and 4.04 shall survive.

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<PAGE>

     Section 4.02.  CONDITIONS TO DEFEASANCE. The Note Issuer may exercise the
Legal Defeasance Option or the Covenant Defeasance Option of Notes only if:

          (a) the Note Issuer irrevocably deposits or causes to be deposited in
trust with the Note Trustee cash or U.S. Government Obligations for the payment
of principal of and interest on each such Note to the Scheduled Maturity Date,
Optional Redemption Date or Mandatory Redemption Date therefor, as applicable;

          (b) the Note Issuer delivers to the Note Trustee a certificate from a
nationally recognized firm of Independent accountants expressing its opinion
that the payments of principal and interest when due and without reinvestment on
the deposited U.S. Government Obligations plus any deposited cash without
investment will provide cash at such times and in such amounts (but, in the case
of the Legal Defeasance Option only, not more than such amounts) as will be
sufficient to pay in respect of the Notes (i) subject to clause (ii), principal
in accordance with the Expected Amortization Schedule therefor, (ii) if to be
redeemed, the Optional Redemption Price or Mandatory Redemption Price, as
applicable, therefor on the related Optional Redemption Date or Mandatory
Redemption Date, as applicable and (iii) interest when due;

          (c) in the case of the Legal Defeasance Option, 91 days pass after the
deposit is made and during the 91-day period no Default specified in Section
5.01(e) or (f) occurs which is continuing at the end of the period;

          (d) no Default has occurred and is continuing on the day of such
deposit and after giving effect thereto;

          (e) in the case of an exercise of the Legal Defeasance Option, the
Note Issuer shall have delivered to the Note Trustee an Opinion of Counsel
stating that (i) the Note Issuer has received from, or there has been published
by, the Internal Revenue Service a ruling, or (ii) since the date of execution
of this Note Indenture, there has been a change in the applicable federal income
tax law, in either case to the effect that, and based thereon such opinion shall
confirm that, the Holders of the Notes will not recognize income, gain or loss
for federal income tax purposes as a result of such legal defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such legal defeasance had not
occurred;

          (f) in the case of an exercise of the Covenant Defeasance Option, the
Note Issuer shall have delivered to the Note Trustee an Opinion of Counsel to
the effect that the Holders of the Notes will not recognize income, gain or loss
for federal income tax purposes as a result of such covenant defeasance and will
be subject to federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such covenant defeasance had not
occurred; and

          (g) the Note Issuer delivers to the Note Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that all conditions
precedent to the satisfaction and discharge of the Notes to the extent
contemplated by this Article IV have been complied with.

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<PAGE>

     Before or after a deposit pursuant to this Section 4.02, the Note Issuer
may make arrangements satisfactory to the Note Trustee for the redemption of
such Notes at a future date in accordance with Article X.

     Section 4.03.  APPLICATION OF TRUST MONEY. All moneys or U.S. Government
Obligations deposited with the Note Trustee pursuant to Section 4.01 or 4.02
hereof shall be held in trust and applied by it, in accordance with the
provisions of the Notes and this Note Indenture, to the payment, either directly
or through any Paying Agent, as the Note Trustee may determine, to the Holders
of the particular Notes for the payment or redemption of which such moneys have
been deposited with the Note Trustee, of all sums due and to become due thereon
for principal and interest, but such moneys need not be segregated from other
funds except to the extent required herein or in the Servicing Agreement or
required by law.

     Section 4.04.  REPAYMENT OF MONEYS HELD BY PAYING AGENT. In connection with
the satisfaction and discharge of this Note Indenture or the Covenant Defeasance
Option or Legal Defeasance Option with respect to the Notes, all moneys then
held by any Paying Agent other than the Note Trustee under the provisions of
this Note Indenture with respect to such Notes shall, upon demand of the Note
Issuer, be paid to the Note Trustee to be held and applied according to Section
3.03 and thereupon such Paying Agent shall be released from all further
liability with respect to such moneys.

                                   ARTICLE V

                                    REMEDIES

     Section 5.01.  EVENTS OF DEFAULT. "Event of Default", wherever used herein,
means any one of the following events (whatever the reason for such Event of
Default and whether it shall be voluntary or 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 on any Note when the same
becomes due and payable, and such default shall continue for a period of five
days; or

          (b) default in the payment of the then unpaid principal of any Note on
the Final Maturity Date; or

          (c) default in the payment of the Optional Redemption Price for the
Notes on the Optional Redemption Date therefor, or a default in the payment of
the Mandatory Redemption Price for the Notes on the Mandatory Redemption Date;

          (d) (i) default in the observance or performance in any material
respect of any covenant or agreement of the Note Issuer made in this Note
Indenture (other than a covenant or agreement, a default in the observance or
performance of which is elsewhere in this Section specifically dealt with), or
(ii) any representation or warranty of the Note Issuer made in this Note
Indenture or in any certificate or other writing delivered pursuant hereto or in
connection herewith proving to have been incorrect in any material respect as of
the time when the same shall have been made and, in any case under clause (i) or
clause (ii), such default shall continue or not be cured, or the circumstance or

                                      -36-

<PAGE>

condition in respect of which such misrepresentation or warranty was incorrect
shall not have been eliminated or otherwise cured, for a period of 30 days after
there shall have been given, by registered or certified mail, to the Note Issuer
by the Note Trustee or to the Note Issuer and the Note Trustee by the Holders of
at least 25 percent of the Outstanding Amount of the Notes, a written notice
specifying such default or incorrect representation or warranty and requiring it
to be remedied and stating that such notice is a "Notice of Default" hereunder;
or

          (e) the filing of a decree or order for relief by a court having
jurisdiction in the premises in respect of the Note Issuer or any substantial
part of the Collateral in an involuntary case under any applicable federal or
state 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 Note Issuer or for any substantial part of the
Collateral, or ordering the winding-up or liquidation of the Note Issuer's
affairs, and such decree or order shall remain unstayed and in effect for a
period of 60 consecutive days; or

          (f) the commencement by the Note Issuer of a voluntary case under any
applicable federal or state bankruptcy, insolvency or other similar law now or
hereafter in effect, or the consent by the Note Issuer to the entry of an order
for relief in an involuntary case under any such law, or the consent by the Note
Issuer to the appointment or taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of the Note
Issuer or for any substantial part of the Collateral, or the making by the Note
Issuer of any general assignment for the benefit of creditors, or the failure by
the Note Issuer generally to pay its debts as such debts become due, or the
taking of action by the Note Issuer in furtherance of any of the foregoing.

     The Note Issuer shall deliver to a Responsible Officer of the Note Trustee,
the Certificate Trustee and the Rating Agencies, within five Business Days after
an Authorized Officer of the Note Issuer has knowledge of the occurrence
thereof, written notice in the form of an Officer's Certificate of any event
which with the giving of notice and the lapse of time would become an Event of
Default under clause (d), its status and what action the Note Issuer is taking
or proposes to take with respect thereto.

     Section 5.02.  ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT. If an
Event of Default should occur and be continuing, then and in every such case the
Note Trustee or the Holders of Notes representing not less than a majority of
the Outstanding Amount of the Notes may declare all the Notes to be immediately
due and payable, by a notice in writing to the Note Issuer (and to the Note
Trustee if given by Noteholders), and upon any such declaration the unpaid
principal amount of the Notes, together with accrued and unpaid interest thereon
through the date of acceleration, shall become immediately due and payable.

     At any time after such declaration of acceleration of maturity has been
made and before a judgment or decree for payment of the money due has been
obtained by the Note Trustee as hereinafter in this Article V provided, the
Holders of Notes representing a majority of the Outstanding Amount of the Notes,
by written notice to the Note Issuer and the Note Trustee, may rescind and annul
such declaration and its consequences if:

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<PAGE>

          (a) the Note Issuer has paid or deposited with the Note Trustee a sum
sufficient to pay:

              (1)   all payments of principal of and interest on all Notes and
                    all other amounts that would then be due hereunder or upon
                    such Notes if the Event of Default giving rise to such
                    acceleration had not occurred; and

              (2)   all sums paid or advanced by the Note Trustee hereunder and
                    the reasonable compensation, expenses, disbursements and
                    advances of the Note Trustee and its agents and counsel and
                    all amounts due under the Fee and Indemnity Agreement; and

          (b) all Events of Default, other than the nonpayment of the principal
of the Notes that has become due solely by such acceleration, have been cured or
waived as provided in Section 5.12.

     No such rescission shall affect any subsequent Default or impair any right
consequent thereto.

     Section 5.03.  COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY NOTE
TRUSTEE.

          (a) The Note Issuer covenants that if (i) default is made in the
payment of any interest on any Note when the same becomes due and payable, and
such default continues for a period of five days, (ii) default is made in the
payment of the then unpaid principal of any Note on the Final Maturity Date for
such Note or (iii) default is made in the payment of the Optional Redemption
Price or Mandatory Redemption Price, as applicable, for any Note on the Optional
Redemption Date or Mandatory Redemption Date, as applicable, therefor, the Note
Issuer will, upon demand of the Note Trustee, pay to it, for the benefit of the
Holders of the Notes, the whole amount then due and payable on such Notes for
principal and interest, with interest upon the overdue principal and, to the
extent payment at such rate of interest shall be legally enforceable, upon
overdue installments of interest, at the respective rate borne by the Notes of
the applicable Class and in addition thereto such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Note
Trustee and its agents and counsel and an amount sufficient to cover all amounts
required to be paid by the Note Issuer under the Fee and Indemnity Agreement.

          (b) Subject to Section 11.16, in case the Note Issuer shall fail
forthwith to pay such amounts upon such demand, the Note Trustee, in its own
name and as trustee of an express trust, may institute a Proceeding for the
collection of the sums so due and unpaid, and may prosecute such Proceeding to
judgment or final decree, and may enforce the same against the Note Issuer or
other obligor upon such Notes and collect in the manner provided by law out of
the property of the Note Issuer or other obligor upon such Notes, wherever
situated, the moneys adjudged or decreed to be payable.

          (c) If an Event of Default occurs and is continuing, the Note Trustee
may, as more particularly provided in Section 5.04, in its discretion, proceed
to protect and enforce its rights and the rights of the Noteholders, by such
appropriate Proceedings as the Note Trustee shall deem most effective to protect

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<PAGE>

and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Note Indenture or in aid of the exercise of any
power granted herein, or to enforce any other proper remedy or legal or
equitable right vested in the Note Trustee by this Note Indenture or by law.

          (d) In case there shall be pending, relative to the Note Issuer or any
other obligor upon the Notes or any Person having or claiming an ownership
interest in the Collateral, Proceedings under Title 11 of the United States Code
or any other applicable federal or state bankruptcy, insolvency or other similar
law, or in case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Note Issuer or its property or such other obligor or
Person, or in case of any other comparable judicial Proceedings relative to the
Note Issuer or other obligor upon the Notes, or to the creditors or property of
the Note Issuer or such other obligor, the Note Trustee, irrespective of whether
the principal of any Notes shall then be due and payable as therein expressed or
by declaration or otherwise and irrespective of whether the Note Trustee shall
have made any demand pursuant to the provisions of this Section, shall be
entitled and empowered, by intervention in such Proceedings or otherwise:

          (i)    to file and prove a claim or claims for the whole amount of
     principal and interest owing and unpaid in respect of the Notes and to file
     such other papers or documents as may be necessary or advisable in order to
     have the claims of (A) the Note Trustee (including any claim for reasonable
     compensation to the Note Trustee and each predecessor Note Trustee, and
     their respective agents, attorneys and counsel, and for reimbursement of
     all expenses and liabilities incurred, and all advances made, by the Note
     Trustee and each predecessor Note Trustee, except as a result of gross
     negligence or willful misconduct), (B) the Noteholders and (C) each Person
     for whom a claim may be made under the Fee and Indemnity Agreement, allowed
     in such Proceedings;

          (ii)   unless prohibited by applicable law and regulations, to vote on
     behalf of the Holders of Notes in any election of a trustee, a standby
     trustee or Person performing similar functions in any such Proceedings; and

          (iii)  to collect and receive any moneys or other property payable or
     deliverable on any such claims and to distribute all amounts received with
     respect to the claims of the Noteholders and of the Note Trustee on their
     behalf;

and any trustee, receiver, liquidator, custodian or other similar official in
any such Proceeding is hereby authorized by each of such Noteholders to make
payments to the Note Trustee, and, in the event that the Note Trustee shall
consent to the making of payments directly to such Noteholders, to pay to the
Note Trustee (or such other beneficiary of the Fee and Indemnity Agreement) such
amounts as shall be sufficient to cover reasonable compensation and other
amounts owing hereunder to the Note Trustee or such Person, each predecessor
Note Trustee and their respective agents, attorneys and counsel, and all other
reasonable expenses and liabilities incurred, and all advances made, by the Note
Trustee and each predecessor Note Trustee except as a result of gross negligence
or willful misconduct.

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<PAGE>

          (e) Nothing herein contained shall be deemed to authorize the Note
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Note Trustee to vote in respect of the claim of any Noteholder in
any such proceeding except, as aforesaid, to vote for the election of a trustee
in bankruptcy or similar Person.

          (f) All rights of action and of asserting claims under this Note
Indenture, or under any of the Notes, may be enforced by the Note Trustee
without the possession of any of the Notes or the production thereof in any
trial or other Proceedings relative thereto, and any such action or proceedings
instituted by the Note Trustee shall be brought in its own name as trustee of an
express trust, and any recovery of judgment, subject to the payment of the
expenses, disbursements and compensation of the Note Trustee, each predecessor
Note Trustee and their respective agents and attorneys, shall be for the ratable
benefit of the Holders of the Notes.

          (g) In any Proceedings brought by the Note Trustee (and also any
Proceedings involving the interpretation of any provision of this Note Indenture
to which the Note Trustee shall be a party), the Note Trustee shall be held to
represent all the Holders of the Notes, and it shall not be necessary to make
any Noteholder a party to any such Proceedings.

     Section 5.04.  REMEDIES; PRIORITIES.

          (a) If an Event of Default shall have occurred and be continuing, the
Note Trustee may do one or more of the following (subject to Section 5.05):

          (i)    institute Proceedings in its own name and as trustee of an
     express trust for the collection of all amounts then payable on the Notes
     or under this Note Indenture with respect thereto, whether by declaration
     or otherwise, enforce any judgment obtained, and collect from the Note
     Issuer and any other obligor upon such Notes moneys adjudged due;

          (ii)   institute Proceedings from time to time for the complete or
     partial foreclosure of this Note Indenture with respect to the Collateral;

          (iii)  exercise any remedies of a secured party under the UCC or the
     Statute and take any other appropriate action to protect and enforce the
     rights and remedies of the Note Trustee and the Holders of the Notes; and

          (iv)   sell the Collateral or any portion thereof or rights or
     interest therein, at one or more public or private sales called and
     conducted in any manner permitted by law;

provided, however, that the Note Trustee may not sell or otherwise liquidate any
portion of the Collateral following an Event of Default, other than an Event of
Default described in Section 5.01(a), (b) or (c), unless (A) the Holders of 100
percent of the Outstanding Amount of the Notes consent thereto, (B) the proceeds
of such sale or liquidation distributable to the Noteholders are sufficient to
discharge in full all amounts then due and unpaid upon such Notes for principal
and interest after taking into account payment of all amounts due prior thereto
pursuant to the priorities set forth in Section 8.02(d) or (C) the Note Trustee
determines that the Collateral will not continue to provide sufficient funds for

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<PAGE>

all payments on the Notes as they would have become due if the Notes had not
been declared due and payable, and the Note Trustee obtains the consent of
Holders of 66-2/3 percent of the Outstanding Amount of the Notes. In determining
such sufficiency or insufficiency with respect to clause (B) and (C), the Note
Trustee may, but need not, obtain and conclusively rely upon an opinion of an
Independent investment banking or accounting firm of national reputation as to
the feasibility of such proposed action and as to the sufficiency of the
Collateral for such purpose.

          (b) If the Note Trustee collects any money pursuant to this Article V,
it shall pay out such money in accordance with the priorities set forth in
Section 8.02(d).

     Section 5.05.  OPTIONAL POSSESSION OF THE COLLATERAL. If the Notes have
been declared to be due and payable under Section 5.02 following an Event of
Default and such declaration and its consequences have not been rescinded and
annulled, the Note Trustee may, but need not, elect to maintain possession of
the Collateral. It is the desire of the parties hereto and the Noteholders that
there be at all times sufficient funds for the payment of principal of and
interest on the Notes, and the Note Trustee shall take such desire into account
when determining whether or not to maintain possession of the Collateral. In
determining whether to maintain possession of the Collateral, the Note Trustee
may, but need not, obtain and conclusively rely upon an opinion of an
Independent investment banking or accounting firm of national reputation as to
the feasibility of such proposed action and as to the sufficiency of the
Collateral for such purpose.

     Section 5.06.  LIMITATION OF SUITS. No Holder of any Note shall have any
right to institute any Proceeding, judicial or otherwise, with respect to this
Note Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless:

          (a) such Holder previously has given written notice to the Note
Trustee of a continuing Event of Default;

          (b) the Holders of not less than 25 percent of the Outstanding Amount
of the Notes have made written request to the Note Trustee to institute such
Proceeding in respect of such Event of Default in its own name as Note Trustee
hereunder;

          (c) such Holder or Holders have offered to the Note Trustee indemnity
satisfactory to it against the costs, expenses and liabilities to be incurred in
complying with such request;

          (d) the Note Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute such Proceedings; and

          (e) no direction inconsistent with such written request has been given
to the Note Trustee during such 60-day period by the Holders of a majority of
the Outstanding Amount of the Notes;

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

                                      -41-

<PAGE>

     In the event the Note Trustee shall receive conflicting or inconsistent
requests and indemnity from two or more groups of Holders of Notes, each
representing less than a majority of the Outstanding Amount of the Notes, the
Note Trustee in its sole discretion may determine what action, if any, shall be
taken, notwithstanding any other provisions of this Note Indenture.

     Section 5.07.  UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE PRINCIPAL AND
INTEREST. Notwithstanding any other provisions in this Note Indenture, the
Holder of any Note shall have the right, which is absolute and unconditional,
(a) to receive payment of (i) the interest, if any, on such Note on or after the
due dates thereof expressed in such Note or in this Note Indenture, (ii) the
unpaid principal, if any, of such Notes on or after the Final Maturity Date
therefor or (iii) in the case of redemption, receive payment of the unpaid
principal of and interest, if any, on such Note on or after the Optional
Redemption Date or Mandatory Redemption Date, as applicable, therefor and (b) to
institute suit for the enforcement of any such payment, and such right shall not
be impaired without the consent of such Holder.

     Section 5.08.  RESTORATION OF RIGHTS AND REMEDIES. If the Note Trustee or
any Noteholder has instituted any Proceeding to enforce any right or remedy
under this Note Indenture and such Proceeding has been discontinued or abandoned
for any reason or has been determined adversely to the Note Trustee or to such
Noteholder, then and in every such case the Note Issuer, the Note Trustee and
the Noteholders shall, subject to any determination in such Proceeding, be
restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Note Trustee and the Noteholders shall
continue as though no such Proceeding had been instituted.

     Section 5.09.  RIGHTS AND REMEDIES CUMULATIVE. No right or remedy herein
conferred upon or reserved to the Note Trustee or to the Noteholders is intended
to be exclusive of any other right or remedy, and every right and remedy shall,
to the extent permitted by law, be cumulative and in addition to every other
right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.

     Section 5.10.  DELAY OR OMISSION NOT A WAIVER. No delay or omission of the
Note Trustee or any Noteholder to exercise any right or remedy accruing upon any
Default or Event of Default shall impair any such right or remedy or constitute
a waiver of any such Default or Event of Default or an acquiescence therein.
Every right and remedy given by this Article V or by law to the Note Trustee or
to the Noteholders may be exercised from time to time, and as often as may be
deemed expedient, by the Note Trustee or by the Noteholders, as the case may be.

     Section 5.11.  CONTROL BY NOTEHOLDERS. The Holders of a majority of the
Outstanding Amount of the Notes (or, if less than all Classes are affected, the
affected Class or Classes) shall have the right to direct the time, method and
place of conducting any Proceeding for any remedy available to the Note Trustee
with respect to the Notes of such Class or Classes or exercising any trust or
power conferred on the Note Trustee with respect to such Class or Classes;
provided, however, that

                                      -42-

<PAGE>

          (a) such direction shall not be in conflict with any rule of law or
with this Note Indenture;

          (b) subject to the express terms of Section 5.04, any direction to the
Note Trustee to sell or liquidate the Collateral shall be by the Holders of
Notes representing not less than 100 percent of the Outstanding Amount of the
Notes;

          (c) if the conditions set forth in Section 5.05 have been satisfied
and the Note Trustee elects to retain the Collateral pursuant to such Section,
then any direction to the Note Trustee by Holders of Notes representing less
than 100 percent of the Outstanding Amount of the Notes to sell or liquidate the
Collateral shall be of no force and effect; and

          (d) the Note Trustee may take any other action deemed proper by the
Note Trustee that is not inconsistent with such direction;

provided, however, that, subject to Section 6.01, the Note Trustee need not take
any action that it determines might involve it in liability or might materially
adversely affect the rights of any Noteholders not consenting to such action.

     Section 5.12.  WAIVER OF PAST DEFAULTS. Prior to the declaration of the
acceleration of the maturity of the Notes as provided in Section 5.02, the
Holders of Notes of not less than a majority of the Outstanding Amount of the
Notes may waive any past Default or Event of Default and its consequences except
a Default (a) in payment of principal of or interest on any of the Notes or (b)
in respect of a covenant or provision hereof which cannot be modified or amended
without the consent of the Holder of each Note or of all Classes affected, which
Defaults may be waived only by the Holders of each Note, or each affected Class,
as the case may be. In the case of any such waiver, the Note Issuer, the Note
Trustee and the Holders of the Notes 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 thereto.

     Upon any such waiver, such Default shall cease to exist and be deemed to
have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured and not to have occurred, for every
purpose of this Note Indenture; but no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any right consequent
thereto.

     Section 5.13.  UNDERTAKING FOR COSTS. All parties to this Note Indenture
agree, and each Holder of any Note by such Holder's 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 Note Indenture, or in any
suit against the Note Trustee for any action taken, suffered or omitted by it as
Note Trustee, the filing by any party litigant in such suit of an undertaking to
pay the costs of such suit, and that such court may in its discretion assess
reasonable costs, including reasonable attorneys' fees, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the provisions of this
Section shall not apply to (a) any suit instituted by the Note Trustee, (b) any

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<PAGE>

suit instituted by any Noteholder, or group of Noteholders, in each case holding
in the aggregate more than 10 percent of the Outstanding Amount of the Notes or
(c) any suit instituted by any Noteholder for the enforcement of the payment of
(i) interest on any Note on or after the due dates expressed in such Note and in
this Note Indenture, (ii) the unpaid principal, if any, of any Note on or after
the Final Maturity Date therefor or (iii) in the case of redemption, the unpaid
principal of and interest on any Note on or after the Optional Redemption Date
or Mandatory Redemption Date, as applicable, therefor.

     Section 5.14.  WAIVER OF STAY OR EXTENSION LAWS. The Note Issuer covenants
(to the extent that it may lawfully do so) that it will not at any time insist
upon, or plead or in any manner whatsoever, claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Note Indenture; and the Note Issuer (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 Note Trustee, but will suffer and permit the execution of every
such power as though no such law had been enacted.

     Section 5.15.  ACTION ON NOTES. The Note Trustee's right to seek and
recover judgment on the Notes or under this Note Indenture shall not be affected
by the seeking, obtaining or application of any other relief under or with
respect to this Note Indenture. Neither the lien of this Note Indenture nor any
rights or remedies of the Note Trustee or the Noteholders shall be impaired by
the recovery of any judgment by the Note Trustee against the Note Issuer or by
the levy of any execution under such judgment upon any portion of the Collateral
or upon any of the assets of the Note Issuer.

     Section 5.16.  PERFORMANCE AND ENFORCEMENT OF CERTAIN OBLIGATIONS.

          (a) Promptly following a request from the Note Trustee to do so and at
the Note Issuer's expense, the Note Issuer agrees to take all such lawful action
as the Note Trustee may reasonably request to compel or secure the performance
and observance by the Seller and the Servicer, as applicable, of each of their
obligations to the Note Issuer under or in connection with the Sale Agreement
and the Servicing Agreement, respectively, in accordance with the terms thereof,
and to exercise any and all rights, remedies, powers and privileges lawfully
available to the Note Issuer under or in connection with the Sale Agreement and
the Servicing Agreement, respectively, to the extent and in the manner directed
by the Note Trustee, including the transmission of notices of default on the
part of the Seller or the Servicer thereunder and the institution of legal or
administrative actions or proceedings to compel or secure performance by the
Seller or the Servicer of each of their obligations under the Sale Agreement and
the Servicing Agreement, respectively.

          (b) If an Event of Default has occurred, the Note Trustee may, and, at
the direction (which direction shall be in writing or by telephone (confirmed in
writing promptly thereafter)) of the Holders of 66-2/3 percent of the
Outstanding Amount of the Notes shall, subject to Article VI, exercise all
rights, remedies, powers, privileges and claims of the Note Issuer against the
Seller or the Servicer under or in connection with the Sale Agreement and the
Servicing Agreement, respectively, including the right or power to take any
action to compel or secure performance or observance by the Seller or the
Servicer of each of their obligations to the Note Issuer thereunder and to give

                                      -44-

<PAGE>

any consent, request, notice, direction, approval, extension or waiver under the
Sale Agreement or the Servicing Agreement, respectively, and any right of the
Note Issuer to take such action shall be suspended.

     Section 5.17.  INTER-CREDITOR AGREEMENT. So long as the Inter-Creditor
Agreement remains in effect, the rights and remedies set forth in this Article V
shall be subject to the provisions of the Inter-Creditor Agreement.

                                   ARTICLE VI

                                THE NOTE TRUSTEE

     Section 6.01.  DUTIES OF NOTE TRUSTEE.

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

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

          (i)    the Note Trustee undertakes to perform such duties and only
     such duties as are specifically set forth in this Note Indenture and no
     implied covenants or obligations shall be read into this Note Indenture
     against the Note Trustee; and

          (ii)   in the absence of bad faith on its part, the Note Trustee may
     conclusively rely, as to the truth of the statements and the correctness of
     the opinions expressed therein, upon certificates or opinions furnished to
     the Note Trustee and conforming to the requirements of this Note Indenture;
     however, the Note Trustee shall examine the certificates and opinions to
     determine whether or not they appear on their face to conform to the
     requirements of this Note Indenture.

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

          (i)    this paragraph does not limit the effect of paragraph (b) of
     this Section;

          (ii)   the Note Trustee shall not be liable for any error of judgment
     or exercise of its discretion which is made in good faith by a Responsible
     Officer unless it is proved that the Note Trustee was grossly negligent in
     ascertaining the pertinent facts; and

          (iii)  the Note Trustee shall not be liable with respect to any action
     it takes or omits to take in good faith in accordance with a direction
     received by it pursuant to Section 5.11.

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

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<PAGE>

          (e) The Note Trustee shall not be liable for interest on any money
received by it except as the Note Trustee may agree in writing with the Note
Issuer.

          (f) Money held in trust by the Note Trustee need not be segregated
from other funds except to the extent required by law or the terms of this Note
Indenture, the Sale Agreement or the Servicing Agreement.

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

          (h) Every provision of this Note Indenture relating to the conduct or
affecting the liability of or affording protection to the Note Trustee shall be
subject to the provisions of this Section and to the provisions of the Trust
Indenture Act.

          (i) In the event that the Note Trustee is also acting as Paying Agent
or Note Registrar hereunder, this Article VI shall also be afforded to such
Paying Agent or Note Registrar.

     Section 6.02.  RIGHTS OF NOTE TRUSTEE.

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

          (b) Before the Note Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel. The Note Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on the Officer's Certificate or Opinion of Counsel.

          (c) The Note Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents or
attorneys or a custodian or nominee, and the Note Trustee shall not be
responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent, attorney, custodian or nominee appointed with
due care by it hereunder.

          (d) The Note Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers; provided, however, that the Note Trustee's conduct does not
constitute willful misconduct or gross negligence.

          (e) The Note Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Note Indenture at the request or
direction of any Holder pursuant to this Note Indenture, unless such Holder
shall have offered to the Note Trustee reasonable security or indemnity against
the costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction.

                                      -46-

<PAGE>

          (f) The Note Trustee shall not be charged with knowledge of any
Default or Event of Default, unless either (i) a Responsible Officer of the Note
Trustee shall have actual knowledge of the Default or Event of Default, or (ii)
written notice of such Default or Event of Default shall have been given to the
Note Trustee by the Note Issuer or by a Holder of the Notes.

     Section 6.03.  INDIVIDUAL RIGHTS OF NOTE TRUSTEE. The Note Trustee in its
individual or any other capacity may become the owner or pledgee of Notes and
may otherwise deal with the Note Issuer or its affiliates with the same rights
it would have if it were not Note Trustee. Any Paying Agent, Note Registrar,
co-registrar or co-paying agent may do the same with like rights. However, the
Note Trustee must comply with Sections 6.11 and 6.12.

     Section 6.04.  NOTE TRUSTEE'S DISCLAIMER. The Note Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Note Indenture or the Notes, it shall not be accountable for the Note
Issuer's use of the proceeds from the Notes, and it shall not be responsible for
any statement of the Note Issuer in the Note Indenture or in any document issued
in connection with the sale of the Notes or in the Notes other than the Note
Trustee's certificate of authentication.

     Section 6.05.  NOTICE OF DEFAULTS. If a Default occurs and is continuing
and if it is actually known to a Responsible Officer of the Note Trustee, the
Note Trustee shall mail to the Finance Authority, each Holder of Notes and to
the Rating Agencies notice of the Default within 30 days after it has such
actual knowledge.

     Section 6.06.  REPORTS BY NOTE TRUSTEE TO HOLDERS.

          (a) So long as the Note Trustee is the Note Registrar and Paying
Agent, it shall deliver to each Noteholder such information in its possession as
may be required to enable such Holder to prepare its federal and state income
tax returns.

          (b) On or prior to each Payment Date therefor, the Note Trustee will
deliver to each Holder of Notes on such Payment Date a statement as provided and
prepared by the Servicer which will include (to the extent applicable) the
following information as to the Notes with respect to such Payment Date or the
period since the previous Payment Date, as applicable:

          (i)    the amount of the distribution to Noteholders allocable to
     principal;

          (ii)   the amount of the distribution to Noteholders allocable to
     interest;

          (iii)  the aggregate outstanding Principal Balance of the Notes, after
     giving effect to payments allocated to principal reported under (i) above;
     and

          (iv)   the difference, if any, between the Principal Balance and the
     Projected Principal Balance as of such Payment Date, after giving effect to
     distributions to be made on such Payment Date.

          (c) The Note Issuer shall send a copy of each Certificate of
Compliance delivered to it pursuant to Section 3.03 of the Servicing Agreement
and each Annual Accountant's Report delivered to it pursuant to Section 3.04 of
the Servicing Agreement to the Note Trustee, the Noteholders and the Rating
Agencies.

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<PAGE>

     If the Note Trustee is also serving as the Certificate Trustee, it shall
also prepare the statements required to be delivered to Certificateholders
pursuant to Section 4.02(d) of the Certificate Indenture.

     Section 6.07.  COMPENSATION AND INDEMNITY. The Note Issuer shall pay to the
Note Trustee from time to time reasonable compensation for its services. The
Note Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Note Issuer shall reimburse the Note Trustee
for all reasonable out-of-pocket expenses, disbursements and advances incurred
or made by it, including costs of collection, in addition to the compensation
for its services. Such expenses shall include the reasonable compensation and
expenses, disbursements and advances of the Note Trustee's agents, counsel,
accountants and experts. The Note Issuer shall indemnify, defend and hold
harmless the Note Trustee and any of its affiliates, officials, officers,
directors, employees, consultants, counsel and agents (the "Indemnified
Persons") from and against any and all losses, claims, actions, suits, taxes,
damages, expenses (including, without limitation, legal fees and expenses) and
liabilities (including liabilities under state or federal securities laws) of
any kind and nature whatsoever (collectively, "Expenses"), to the extent that
such Expenses arise out of or are imposed upon or asserted against such
Indemnified Persons with respect to the creation, administration, operation or
termination of this trust and the performance by the Note Trustee of its duties
hereunder, the failure of the Note Issuer or any other Person (other than the
Person being indemnified) to perform its obligations hereunder or under any of
the Basic Documents, or otherwise in connection with the Basic Documents or the
transactions contemplated thereby, provided, however, that the Note Issuer is
not required to indemnify any Indemnified Person for any Expenses that result
from the willful misconduct or gross negligence of such Indemnified Person and,
provided, further, that any Expenses payable to any Indemnified Person hereunder
shall be paid to the Note Trustee for deposit into and distribution from the
Collection Account in accordance with Article VIII hereof. The willful
misconduct or gross negligence of any Note Trustee shall not affect the rights
of any predecessor or successor Note Trustee hereunder. The Note Issuer shall
not be required to indemnify an Indemnified Person for any amount paid or
payable by such Indemnified Person pursuant to this Section 6.07 in the
settlement of any action, proceeding or investigation without the written
consent of the Note Issuer, which consent shall not be unreasonably withheld.
Promptly after receipt by an Indemnified Person of notice of its involvement in
any action, proceeding or investigation, such Indemnified Person shall, if a
claim for indemnification in respect thereof is to be made against the Note
Issuer under this Section 6.07, notify the Note Issuer in writing of such
involvement. Failure by an Indemnified Person to so notify the Note Issuer shall
relieve the Note Issuer from the obligation to indemnify and hold harmless such
Indemnified Person under this Section 6.07, only to the extent that the Note
Issuer suffers actual prejudice as a result of such failure. With respect to any
action, proceeding or investigation brought by a third party for which
indemnification may be sought under this Section 6.07, the Note Issuer shall be
entitled to assume the defense of any such action, proceeding or investigation.
Upon assumption by the Note Issuer of the defense of any such action, proceeding
or investigation, the Indemnified Person shall have the right to participate in
such action or proceeding and to retain its own counsel. The Note Issuer shall
be entitled to appoint counsel of the Note Issuer's choice at the Note Issuer's
expense to represent the Indemnified Person in any action, proceeding or

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investigation for which a claim of indemnification is made against the Note
Issuer under this Section 6.07 (in which case the Note Issuer shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by the Indemnified Person except as set forth below); provided,
however, that such counsel shall be reasonably satisfactory to the Indemnified
Person. Notwithstanding the Note Issuer's election to appoint counsel to
represent the Indemnified Person in an action, proceeding or investigation, the
Indemnified Person shall have the right to employ separate counsel (including
local counsel), and the Note Issuer shall bear the reasonable fees, costs and
expenses of such separate counsel if (i) the use of counsel chosen by the Note
Issuer to represent the Indemnified Person would present such counsel with a
conflict of interest, (ii) the actual or potential defendants in, or targets of,
any such action include both the Indemnified Person and the Note Issuer and the
Indemnified Person shall have reasonably concluded that there may be legal
defenses available to it that are different from or additional to those
available to the Note Issuer, (iii) the Note Issuer shall not have employed
counsel reasonably satisfactory to the Indemnified Person to represent the
Indemnified Person within a reasonable time after notice of the institution of
such action or (iv) the Note Issuer shall authorize the Indemnified Person to
employ separate counsel at the expense of the Note Issuer. Notwithstanding the
foregoing, the Note Issuer shall not be obligated to pay for the fees, costs and
expenses of more than one separate counsel for the Indemnified Persons (in
addition to local counsel). The Note Issuer will not, without the prior written
consent of the Indemnified Person, settle or compromise or consent to the entry
of any judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification may be sought under this Section
6.07 (whether or not the Indemnified Person is an actual or potential party to
such claim or action) unless such settlement, compromise or consent includes an
unconditional release of the Indemnified Person from all liability arising out
of such claim, action, suit or proceeding. Indemnification under this Section
6.07 shall include reasonable fees and out-of-pocket expenses of investigation
and litigation (including reasonable attorneys' fees and expenses), except as
otherwise provided in this Agreement.

     The Note Issuer's payment obligations to the Note Trustee pursuant to this
Section shall survive the discharge of this Note Indenture or the earlier
resignation or removal of the Note Trustee. When the Note Trustee incurs
expenses after the occurrence of a Default specified in Section 5.01(e) or (f)
with respect to the Note Issuer, the expenses are intended to constitute
expenses of administration under Title 11 of the United States Code or any other
applicable federal or state bankruptcy, insolvency or similar law.

     Section 6.08.  REPLACEMENT OF NOTE TRUSTEE. The Note Trustee may resign at
any time by so notifying the Note Issuer, provided, however, that no such
resignation shall be effective until either (a) the Collateral has been
completely liquidated and the proceeds of the liquidation distributed to the
Noteholders or (b) a successor trustee having the qualifications set forth in
Section 6.11 has been designated and has accepted such trusteeship. The Holders
of a majority in Outstanding Amount of the Notes may remove the Note Trustee by
so notifying the Note Trustee and may appoint a successor Note Trustee with the
prior written consent of the Note Issuer which shall not be unreasonably
withheld. The Note Issuer shall remove the Note Trustee if:

          (a) the Note Trustee fails to comply with Section 6.11;

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<PAGE>

          (b) the Note Trustee is adjudged a bankrupt or insolvent;

          (c) a receiver or other public officer takes charge of the Note
Trustee or its property; or

          (d) the Note Trustee otherwise becomes incapable of acting.

     The Note Issuer may remove the Note Trustee if the Note Trustee fails to
perform its obligations hereunder in any material respect and shall not have
cured such failure within 30 days after written notice thereof from the Note
Issuer.

     If the Note Trustee resigns or is removed or if a vacancy exists in the
office of Note Trustee for any reason (the Note Trustee in such event being
referred to herein as the retiring Note Trustee), the Note Issuer shall promptly
appoint a successor Note Trustee.

     A successor Note Trustee shall deliver a written acceptance of its
appointment to the retiring Note Trustee and to the Note Issuer. Thereupon the
resignation or removal of the retiring Note Trustee shall become effective, and
the successor Note Trustee shall have all the rights, powers and duties of the
Note Trustee under this Note Indenture. The successor Note Trustee shall mail a
notice of its succession to Noteholders and to the Rating Agencies. The retiring
Note Trustee shall promptly transfer all property held by it as Note Trustee to
the successor Note Trustee.

     If a successor Note Trustee does not take office within 60 days after the
retiring Note Trustee resigns or is removed, the retiring Note Trustee, the Note
Issuer or the Holders of a majority in Outstanding Amount of the Notes may
petition any court of competent jurisdiction for the appointment of a successor
Note Trustee.

     If the Note Trustee fails to comply with Section 6.11, any Noteholder may
petition any court of competent jurisdiction for the removal of the Note Trustee
and the appointment of a successor Note Trustee.

     Notwithstanding the replacement of the Note Trustee pursuant to this
Section, the Note Issuer's obligations under Section 6.07 shall continue for the
benefit of the retiring Note Trustee.

     Section 6.09.  SUCCESSOR NOTE TRUSTEE BY MERGER. If the Note Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Note Trustee. The successor Note Trustee
shall mail a notice of its merger, conversion, consolidation or transfer to the
Rating Agencies and the Note Issuer.

     In case at the time such successor or successors by merger, conversion,
consolidation or transfer to the Note Trustee shall succeed to the trusts
created by this Note Indenture any of the Notes shall have been authenticated
but not delivered, any such successor to the Note Trustee may adopt the
certificate of authentication of any predecessor trustee, and deliver such Notes
so authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Note Trustee may authenticate such Notes
either in the name of any predecessor hereunder or in the name of the successor
to the Note Trustee; and in all such cases such certificates shall be valid for
all purposes hereunder and under the Notes.

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<PAGE>

     Section 6.10.  APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.

          (a) Notwithstanding any other provisions of this Note Indenture, at
any time, for the purpose of meeting any legal requirement of any jurisdiction
in which any part of the Collateral may at the time be located, the Note Trustee
shall have the power and may execute and deliver all instruments to appoint one
or more Persons to act as a co-trustee or co-trustees, or separate trustee or
separate trustees, of all or any part of the Collateral, and to vest in such
Person or Persons, in such capacity and for the benefit of the Noteholders, such
title to the Collateral, or any part hereof, and, subject to the other
provisions of this Section, such powers, duties, obligations, rights and trusts
as the Note Trustee may consider necessary or desirable. No co-trustee or
separate trustee hereunder shall be required to meet the terms of eligibility as
a successor trustee under Section 6.11 and no notice to Noteholders of the
appointment of any co-trustee or separate trustee shall be required under
Section 6.08 hereof.

          (b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:

          (i)    all rights, powers, duties and obligations conferred or imposed
     upon the Note Trustee shall be conferred or imposed upon and exercised or
     performed by the Note Trustee and such separate trustee or co-trustee
     jointly (it being understood that such separate trustee or co-trustee is
     not authorized to act separately without the Note Trustee joining in such
     act), except to the extent that under any law of any jurisdiction in which
     any particular act or acts are to be performed the Note Trustee shall be
     incompetent or unqualified to perform such act or acts, in which event such
     rights, powers, duties and obligations (including the holding of title to
     the Collateral or any portion thereof in any such jurisdiction) shall be
     exercised and performed singly by such separate trustee or co-trustee, but
     solely at the direction of the Note Trustee;

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

          (iii)  the Note Trustee may at any time accept the resignation of or
     remove any separate trustee or co-trustee.

          (c) Any notice, request or other writing given to the Note Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Note Indenture
and the conditions of this Article VI. Each separate trustee and co-trustee,
upon its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Note Trustee or separately, as may be provided therein, subject to all the
provisions of this Note Indenture, specifically including every provision of
this Note Indenture relating to the conduct of, affecting the liability of, or
affording protection to, the Note Trustee. Every such instrument shall be filed
with the Note Trustee.

                                      -51-

<PAGE>

          (d) Any separate trustee or co-trustee may at any time constitute the
Note Trustee, its agent or attorney-in-fact with full power and authority, to
the extent not prohibited by law, to do any lawful act under or in respect of
this Note Indenture on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Note Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.

     Section 6.11.  ELIGIBILITY; DISQUALIFICATION. The Note Trustee shall at all
times satisfy the requirements of Trust Indenture Act ss. 310(a) and Section
26(a)(i) of the Investment Company Act of 1940. The Note Trustee shall have a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition and it shall have a long term debt
rating of A (or the equivalent thereof) or better by all of the Rating Agencies
from which a rating is available. The Note Trustee shall comply with Trust
Indenture Act ss. 310(b), including the optional provision permitted by the
second sentence of Trust Indenture Act ss. 310(b)(9); provided, however, that
there shall be excluded from the operation of Trust Indenture Act ss. 310(b)(1)
any indenture or indentures under which other securities of the Note Issuer are
outstanding if the requirements for such exclusion set forth in Trust Indenture
Act ss. 310(b)(1) are met.

     Section 6.12.  PREFERENTIAL COLLECTION OF CLAIMS AGAINST NOTE ISSUER. The
Note Trustee shall comply with Trust Indenture Act ss. 311(a), excluding any
creditor relationship listed in Trust Indenture Act ss. 311(b). A Note Trustee
who has resigned or been removed shall be subject to Trust Indenture Act ss.
311(a) to the extent indicated.

     Section 6.13.  REPRESENTATIONS AND WARRANTIES OF NOTE TRUSTEE. The Note
Trustee hereby represents and warrants that:

          (a) the Note Trustee is a national banking association validly
existing under the federal laws of the United States; and

          (b) the Note Trustee has full power, authority and legal right to
execute, deliver and perform this Note Indenture and the Basic Documents to
which the Note Trustee is a party and has taken all necessary action to
authorize the execution, delivery, and performance by it of this Note Indenture
and such Basic Documents.

     Section 6.14.  COVENANTS OF THE NOTE TRUSTEE. The Note Trustee hereby
covenants and agrees as follows:

          (a) the Note Trustee will establish the Collection Account as a
Securities Account;

          (b) the Note Trustee, acting as Securities Intermediary, will identify
the Collection Account in its records as a Securities Account of the Note
Trustee and will identify the Note Trustee in such records as the Person having
the Security Entitlement against the Securities Intermediary with respect to the
Securities Account and all Security Entitlements carried in the Securities
Account;

                                      -52-

<PAGE>

          (c) the Note Trustee, acting as Securities Intermediary, will maintain
accurate and complete records of the Financial Assets in the Securities Account
such that the Collateral is objectively determinable;

          (d) the Note Trustee, acting as Securities Intermediary, will in the
ordinary course of its business, maintain securities accounts for its customers,
will act in that capacity in holding the Securities Account under this Note
Indenture and will at all times be located in and maintain its books and records
relating to all of these securities in the State of [DELAWARE];

          (e) the Note Trustee, acting as Securities Intermediary, will treat
all Eligible Investments as Financial Assets and will duly hold the Eligible
Investments in the Securities Account; and

          (f) the Note Trustee, acting as Securities Intermediary, will not
agree to comply with entitlement orders of any secured party other than the Note
Trustee with respect to the Securities Account or any Security Entitlements
carried in the Securities Account.

                                  ARTICLE VII

                         NOTEHOLDERS' LISTS AND REPORTS

     Section 7.01.  NOTE ISSUER TO FURNISH NOTE TRUSTEE NAMES AND ADDRESSES OF
NOTEHOLDERS. The Note Issuer will furnish or cause to be furnished to the Note
Trustee (a) not more than five days after the earlier of (i) each Record Date
and (ii) six months after the last Record Date, a list, in such form as the Note
Trustee may reasonably require, of the names and addresses of the Holders of
Notes as of such Record Date, (b) at such other times as the Note Trustee may
request in writing, within 30 days after receipt by the Note Issuer of any such
request, a list of similar form and content as of a date not more than 10 days
prior to the time such list is furnished; provided, however, that so long as the
Note Trustee is the Note Registrar, no such list shall be required to be
furnished.

     Section 7.02.  PRESERVATION OF INFORMATION; COMMUNICATIONS TO NOTEHOLDERS.

          (a) The Note Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Holders of Notes
contained in the most recent list furnished to the Note Trustee as provided in
Section 7.01 and the names and addresses of Holders of Notes received by the
Note Trustee in its capacity as Note Registrar. The Note Trustee may destroy any
list furnished to it as provided in such Section 7.01 upon receipt of a new list
so furnished.

          (b) Noteholders may communicate pursuant to Trust Indenture Act ss.
312(b) with other Noteholders with respect to their rights under this Note
Indenture or under the Notes.

          (c) The Note Issuer, the Note Trustee and the Note Registrar shall
have the protection of Trust Indenture Act ss. 312(c).

                                      -53-

<PAGE>

     Section 7.03.  REPORTS BY NOTE ISSUER.

          (a) The Note Issuer shall:

          (i)    so long as the Note Issuer is required to file such documents
     with the Commission, file with the Note Trustee, within 15 days after the
     Note Issuer is required to file the same 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 the Commission may from
     time to time by rules and regulations prescribe) which the Note Issuer may
     be required to file with the Commission pursuant to Section 13 or 15(d) of
     the Exchange Act;

          (ii)   file with the Note Trustee and the Commission in accordance
     with rules and regulations prescribed from time to time by the Commission
     such additional information, documents and reports with respect to
     compliance by the Note Issuer with the conditions and covenants of this
     Note Indenture as may be required from time to time by such rules and
     regulations; and

          (iii)  supply to the Note Trustee (and the Note Trustee shall transmit
     by mail to all Noteholders described in Trust Indenture Act ss. 313(c))
     such summaries of any information, documents and reports required to be
     filed by the Note Issuer pursuant to clauses (i) and (ii) of this Section
     7.03(a) as may be required by rules and regulations prescribed from time to
     time by the Commission.

          (b) Unless the Note Issuer otherwise determines, the fiscal year of
the Note Issuer shall end on December 31 of each year.

     Section 7.04.  REPORTS BY NOTE TRUSTEE. If required by Trust Indenture Act
ss. 313(a), within 60 days after December 31 of each year, commencing December
31, 2001, the Note Trustee shall mail to each Holder of Notes as required by
Trust Indenture Act ss. 313(c) a brief report dated as of such date that
complies with Trust Indenture Act ss. 313(a). The Note Trustee also shall comply
with Trust Indenture Act ss. 313(b).

     A copy of each report at the time of its mailing to Noteholders shall be
filed by the Note Trustee with the Commission and each stock exchange, if any,
on which the Notes are listed. The Note Issuer shall notify the Note Trustee if
and when the Notes are listed on any stock exchange.

                                  ARTICLE VIII

                      ACCOUNTS, DISBURSEMENTS AND RELEASES

     Section 8.01.  COLLECTION OF MONEY. Except as otherwise expressly provided
herein, the Note Trustee may demand payment or delivery of, and shall receive
and collect, directly and without intervention or assistance of any fiscal agent
or other intermediary, all money and other property payable to or receivable by
the Note Trustee, the Certificate Trustee or the Delaware Trustee pursuant to
this Note Indenture, the Certificate Indenture and the Fee and Indemnity
Agreement. The Note Trustee shall apply all such money received by it as
provided in this Note Indenture. Except as otherwise expressly provided in this

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<PAGE>

Note Indenture, if any default occurs in the making of any payment or
performance under any agreement or instrument that is part of the Collateral,
the Note Trustee may take such action as may be appropriate to enforce such
payment or performance, subject to Article VI, including the institution and
prosecution of appropriate Proceedings. Any such action shall be without
prejudice to any right to claim a Default or Event of Default under this Note
Indenture and any right to proceed thereafter as provided in Article V.

     Section 8.02.  COLLECTION ACCOUNT.

          (a) Prior to the Issuance Date, the Note Issuer shall open, at the
Note Trustee's Corporate Trust Office, or at another Eligible Institution, one
or more segregated trust accounts in the Note Trustee's name for the deposit of
RRB Charge Payments and other amounts remitted under the Servicing Agreement
(collectively, the "Collection Account"). The Note Trustee shall hold the
Collection Account for the benefit of Noteholders. The Collection Account will
consist of four subaccounts: a general subaccount (the "General Subaccount"), a
reserve subaccount (the "Reserve Subaccount"), an overcollateralization
subaccount (the "Overcollateralization Subaccount") and a capital subaccount
(the "Capital Subaccount"). All amounts in the Collection Account not allocated
to any other subaccount shall be allocated to the General Subaccount. Prior to
the initial Payment Date, all amounts in the Collection Account (other than
funds deposited into the Capital Subaccount, together with interest earnings
thereon) shall be allocated to the General Subaccount. All references to the
Collection Account shall be deemed to include reference to all subaccounts
contained therein. Withdrawals from and deposits to each of the foregoing
subaccounts of the Collection Account shall be made as set forth in Section
8.02. The Collection Account shall at all times be maintained in an Eligible
Deposit Account and only the Note Trustee shall have access to the Collection
Account for the purpose of making deposits in and withdrawals from the
Collection Account in accordance with this Note Indenture. Funds in the
Collection Account shall not be commingled with any other moneys. Except as
provided in Section 8.03, all moneys deposited from time to time in the
Collection Account, all deposits therein pursuant to this Note Indenture, and
all investments made in Eligible Investments with such moneys, including all
income or other gain from such investments, shall be held by the Note Trustee in
the Collection Account as part of the Collateral as herein provided.

          (b) The Note Trustee shall have sole dominion and exclusive control
over all moneys in the Collection Account and shall apply such amounts therein
as provided in this Section 8.02.

          (c) All RRB Charge Payments and other remittances under the Servicing
Agreement shall be deposited in the General Subaccount as provided in Section
4.03 of the Servicing Agreement. All deposits to and withdrawals from the
Collection Account and all allocations to the subaccounts of the Collection
Account shall be made by the Note Trustee in accordance with the written
instructions provided by the Servicer in the Quarterly Servicer Certificate or
as otherwise provided herein.

          (d) On any Business Day upon which the Note Trustee receives a written
request from the Administrator stating that any Operating Expense payable by the
Note Issuer (but only as described in clauses (i) through (iv) below) will

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<PAGE>

become due and payable prior to the next succeeding Payment Date, and setting
forth the amount and nature of such Operating Expenses, as well any supporting
documentation that the Note Trustee may reasonably request, the Note Trustee,
upon receipt of such information, will make payment of such Operating Expenses
on or before the date such payment is due from amounts on deposit in the General
Subaccount, the Reserve Subaccount, the Overcollateralization Subaccount and the
Capital Subaccount, in that order and only to the extent required to make such
payment.

     On each Payment Date, or for any amount payable under clauses (i) through
(iv) below, on any Business Day, the Note Trustee shall apply all amounts on
deposit in the Collection Account, including all net earnings thereon (other
than on amounts in the Capital Subaccount), to pay the following amounts, in
accordance with the Quarterly Servicer Certificate, in the following priority:

          (i)    all amounts owed by the Note Issuer to the Note Trustee
     (including indemnity payments and legal fees and expenses) shall be paid to
     the Note Trustee (subject to Section 6.07), all amounts owed by the Note
     Issuer to the Certificate Trustee, the Delaware Trustee, the Finance
     Authority and the Certificate Issuer under the Fee and Indemnity Agreement
     shall be paid to the Certificate Trustee, the Delaware Trustee, the Finance
     Authority and the Certificate Issuer, as appropriate; provided, however,
     that the amount paid by the Note Trustee on behalf of the Note Issuer
     pursuant to this clause (i) to (A) the Note Trustee, the Certificate
     Trustee and the Delaware Trustee shall not in the aggregate exceed $10
     million and (B) the Finance Authority and the Certificate Issuer shall not
     in the aggregate exceed $5 million, unless, in each case, Standard & Poor's
     shall have notified the Servicer, the Note Issuer, the Note Trustee, the
     Finance Authority and the Certificate Trustee in writing that such action
     will not result in a reduction or withdrawal of the then current rating by
     such Rating Agency of any Class of the Notes or any Class of the
     Certificates.

          (ii)   the Servicing Fee for such Payment Date and all unpaid
     Servicing Fees from prior Payment Dates shall be paid to the Servicer;

          (iii)  the Administration Fee and all unpaid Administration Fees from
     prior Payment Dates shall be paid to the Administrator;

          (iv)   so long as no Default or Event of Default shall have occurred
     and be continuing or would result from such payment, all other Operating
     Expenses shall be paid to the Persons entitled thereto (other than the
     Persons referred to in clause (i) above); provided, however, that the
     amount of such other Operating Expenses paid by the Note Trustee from, but
     not including, the previous Payment Date to, and including, the current
     Payment Date shall not in the aggregate exceed $100,000;

          (v)    (A) any overdue Quarterly Interest (together with, to the
     extent lawful, interest on such overdue Quarterly Interest at the
     applicable Note Interest Rate) and (B) Quarterly Interest for such Payment
     Date shall be paid to the Noteholders;

                                      -56-

<PAGE>

          (vi)   (A) principal due and payable on the Notes (x) as a result of
     an Event of Default or (y) on the Final Maturity Date of the Notes, shall
     be paid to the Noteholders and (B) Quarterly Principal for such Payment
     Date shall be paid to the Noteholders;

          (vii)  unpaid Operating Expenses shall be paid to the Persons entitled
     thereto;

          (viii) the amount, if any, by which the Required Capital Level with
     respect to all Outstanding Notes exceeds the amount in the Capital
     Subaccount (disregarding any interest earnings held in the Capital
     Subaccount which have not been remitted to the Note Issuer) as of such
     Payment Date shall be allocated to the Capital Subaccount;

          (ix)   the amount, if any, by which the Required Overcollateralization
     Level, with respect to all Outstanding Notes, exceeds the amount in the
     Overcollateralization Subaccount as of such Payment Date shall be allocated
     to the Overcollateralization Subaccount;

          (x)    the balance, if any, shall be allocated to the Reserve
     Subaccount for distribution on subsequent Payment Dates; and

          (xi)   after principal of and interest on all Notes, and all of the
     other foregoing amounts, have been paid in full, the balance, if any, shall
     be paid to the Note Issuer, free from the lien of this Note Indenture.

     In the case of any deficiency in the amount required under clause (v)
above, amounts available to make payments under clause (v) above will be
allocated among each Class of Notes pro rata based upon the respective amounts
of interest owed on the Notes of each Class, and allocated and paid to holders
within each Class pro rata based upon the respective principal amount of Notes
held. In the case of any deficiency in the amount required under clause (vi)
above, amounts available to make payments under clause (vi) above will be
allocated among each Class of Notes pro rata based upon the respective principal
amount of Notes due (in the case of clause (vi)(A)(x)) or scheduled to be paid
(in the case of clauses (vi)(A)(y) and (vi)(B), based on the priorities set
forth in Section 2.01(c)(iii) and according to the expected amortization
schedule for such Class), and allocated and paid to the holders within each
Class pro rata based upon the principal amount of Notes held.

          (e) If on any Payment Date, or for any amounts payable under clauses
(i) through (iv) above, on any Business Day, funds on deposit in the General
Subaccount are insufficient to make the payments contemplated by clauses (i)
through (vi) of Section 8.02(d) above, the Note Trustee shall (i) first, draw
from amounts on deposit in the Reserve Subaccount, (ii) second, draw from
amounts on deposit in the Overcollateralization Subaccount and (iii) third, draw
from amounts on deposit in the Capital Subaccount, in each case, up to the
amount of such shortfall in order to make the payments contemplated by clauses
(i) through (vi) of Section 8.02(d). In addition, if on any Payment Date funds
on deposit in the General Subaccount are insufficient to make the allocations
contemplated by clauses (viii) and (ix) above, the Note Trustee shall draw from
amounts on deposit in the Reserve Subaccount to make such allocations.

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<PAGE>

          (f) On any Optional Redemption Date or Mandatory Redemption Date, the
Note Trustee shall pay to the Noteholders the Optional Redemption Price or
Mandatory Redemption Price, as the case may be.

          (g) On the last day of each month, if the amount in the Capital
Subaccount exceeds the Required Capital Level, the Note Trustee shall pay to the
Note Issuer, upon receipt of an Issuer Request, free from the lien of this Note
Indenture, all amounts in the Capital Subaccount in excess of the Required
Capital Level.

     Section 8.03.  GENERAL PROVISIONS REGARDING THE COLLECTION ACCOUNT.

          (a) So long as no Default or Event of Default shall have occurred and
be continuing, all or a portion of the funds in the Collection Account shall be
invested in Eligible Investments and reinvested by the Note Trustee upon Issuer
Order; provided, however, that (i) such Eligible Investments shall not mature
later than the Business Day prior to the next Payment Date, (ii) such Eligible
Investments shall not be sold, liquidated or otherwise disposed of at a loss
prior to the maturity thereof and (iii) if such Eligible Investments have a
maturity of one month or less, such Eligible Investments (or the provider
thereof) must have a long-term unsecured debt rating of at least A2 by Moody's
(or the equivalent thereof by the other Rating Agencies) or a short-term rating
of at least P-1 by Moody's (or the equivalent thereof by the other Rating
Agencies), and if such Eligible Investments have a maturity of greater than one
month, such Eligible Investments (or the provider thereof) must have a long-term
unsecured debt rating of at least Aaa by Moody's (or the equivalent thereof by
the other Rating Agencies) and a short-term rating of at least P-1 by Moody's
(or the equivalent thereof by the other Rating Agencies). All income or other
gain from investments of moneys deposited in the Collection Account shall be
deposited by the Note Trustee in the Collection Account, and any loss resulting
from such investments shall be charged to the Collection Account; provided,
however, that all income or other gain from investments of moneys deposited in
the Capital Subaccount shall be retained in the Capital Subaccount, and any loss
resulting from such investments shall be charged to the Capital Subaccount. The
Note Issuer will not direct the Note Trustee to make any investment of any funds
or to sell any investment held in the Collection Account unless the security
interest Granted and perfected in such account will continue to be perfected in
such investment or the proceeds of such sale, in either case without any further
action by any Person, and, in connection with any direction to the Note Trustee
to make any such investment or sale, if requested by the Note Trustee, the Note
Issuer shall deliver to the Note Trustee an Opinion of Counsel, reasonably
acceptable to the Note Trustee, to such effect. In no event shall the Note
Trustee be liable for the selection of Eligible Investments or for investment
losses incurred thereon. The Note Trustee shall have no liability in respect of
losses incurred as a result of the liquidation of any Eligible Investment prior
to its stated maturity or the failure of the Note Issuer to provide timely
written investment direction. The Note Trustee shall have no obligation to
invest or reinvest any amounts held hereunder in the absence of written
investment direction pursuant to an Issuer Order. If the rating of the Eligible
Institution, which may be the Note Trustee's Corporate Trust Office, falls below
the rating requirements set forth in clause (b)(i) of the definition of Eligible
Institution, the Note Trustee shall notify the Delaware Trustee and the
Certificate Indenture provides that the Delaware Trustee, on behalf of the
Certificate Issuer, shall, within one month after notice of such rating change,
cause the Collection Account to be transferred to an institution meeting the
requirements set forth in clause (b)(i) of the definition of "Eligible
Institution."

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<PAGE>

          (b) Subject to Section 6.01(c), the Note Trustee shall not in any way
be held liable by reason of any insufficiency in the Collection Account
resulting from any loss on any Eligible Investment included therein except for
losses attributable to the Note Trustee's failure to make payments on such
Eligible Investments issued by the Note Trustee, in its commercial capacity as
principal obligor and not as trustee, in accordance with their terms.

          (c) If (i) the Note Issuer shall have failed to give written
investment directions for any funds on deposit in the Collection Account to the
Note Trustee by 11:00 a.m. Eastern Time (or such other time as may be agreed by
the Note Issuer and Note Trustee) on any Business Day; or (ii) a Default or
Event of Default shall have occurred and be continuing with respect to the Notes
but the Notes shall not have been declared due and payable pursuant to Section
5.02; then the Note Trustee shall, to the fullest extent practicable, invest and
reinvest funds in the Collection Account in one or more investments described
under paragraph (g) of the definition of Eligible Investments.

     Section 8.04.  RELEASE OF COLLATERAL.

          (a) The Note Trustee may, and when required by the provisions of this
Note Indenture shall, execute instruments to release property from the lien of
this Note Indenture, or convey the Note Trustee's interest in the same, in a
manner and under circumstances that are not inconsistent with the provisions of
this Note Indenture. No party relying upon an instrument executed by the Note
Trustee as provided in this Article VIII shall be bound to ascertain the Note
Trustee's authority, inquire into the satisfaction of any conditions precedent
or see to the application of any moneys.

          (b) The Note Trustee shall, at such time as there are no Notes
Outstanding, release any remaining portion of the Collateral that secured the
Notes from the lien of this Note Indenture and release to the Note Issuer or any
other Person entitled thereto any funds then on deposit in the Collection
Account. The Note Trustee shall release property from the lien of this Note
Indenture pursuant to this Section 8.04(b) only upon receipt of an Issuer
Request accompanied by an Officer's Certificate, an Opinion of Counsel and (if
required by the Trust Indenture Act) Independent Certificates in accordance with
Trust Indenture Act ss.ss. 314(c) and 314(d)(1) meeting the applicable
requirements of Section 11.01.

     Section 8.05.  OPINION OF COUNSEL. The Note Trustee shall receive at least
seven days' notice when requested by the Note Issuer to take any action pursuant
to Section 8.04(a), accompanied by copies of any instruments involved, and the
Note Trustee shall also require, as a condition to such action, an Opinion of
Counsel, in form and substance reasonably satisfactory to the Note Trustee,
stating the legal effect of any such action, outlining the steps required to
complete the same, and concluding that all conditions precedent to the taking of
such action have been complied with and such action will not materially and
adversely impair the security for the Notes or the rights of the Noteholders in
contravention of the provisions of this Note Indenture; provided, however, that
such Opinion of Counsel shall not be required to express an opinion as to the
fair value of the Collateral. Counsel rendering any such opinion may rely,
without independent investigation, on the accuracy and validity of any
certificate or other instrument delivered to the Note Trustee in connection with
any such action.

                                      -59-

<PAGE>

     Section 8.06.  REPORTS BY INDEPENDENT ACCOUNTANTS. As of the Issuance Date,
the Note Issuer shall appoint a firm of Independent certified public accountants
of recognized national reputation for purposes of preparing and delivering the
reports or certificates of such accountants required by this Note Indenture. In
the event such firm requires the Note Trustee to agree to the procedures
performed by such firm, the Note Issuer shall direct the Note Trustee in writing
to so agree; it being understood and agreed that the Note Trustee will deliver
such letter of agreement in conclusive reliance upon the direction of the Note
Issuer, and the Note Trustee makes no independent inquiry or investigation to,
and shall have no obligation or liability in respect of, the sufficiency,
validity or correctness of such procedures. Upon any resignation by such firm
the Note Issuer shall provide written notice thereof to the Note Trustee and
shall promptly appoint a successor thereto that shall also be a firm of
Independent certified public accountants of recognized national reputation. If
the Note Issuer shall fail to appoint a successor to a firm of Independent
certified public accountants that has resigned within 15 days after such
resignation, the Note Trustee shall promptly notify the Note Issuer of such
failure in writing. If the Note Issuer shall not have appointed a successor
within 10 days thereafter the Note Trustee shall promptly appoint a successor
firm of Independent certified public accountants of recognized national
reputation; provided, however, that the Note Trustee shall have no liability
with respect to such appointment if the Note Trustee acted with due care with
respect thereto. The fees of such Independent certified public accountants and
its successor shall be payable by the Note Issuer.

                                   ARTICLE IX

                          SUPPLEMENTAL NOTE INDENTURES

     Section 9.01.  SUPPLEMENTAL NOTE INDENTURES WITHOUT CONSENT OF NOTEHOLDERS.

          (a) Without the consent of the Holders of any Notes but with prior
notice to the Rating Agencies, the Note Issuer and the Note Trustee, when
authorized by an Issuer Order, at any time and from time to time, may enter into
one or more indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act as in force at the date of the execution
thereof), in form reasonably satisfactory to the Note Trustee, for any of the
following purposes:

          (i)    to correct or amplify the description of any property at any
     time subject to the lien of this Note Indenture, or better to assure,
     convey and confirm unto the Note Trustee any property subject or required
     to be subjected to the lien of this Note Indenture, or to subject to the
     lien of this Note Indenture additional property;

          (ii)   to evidence the succession, in compliance with the applicable
     provisions hereof, of another person to the Note Issuer, and the assumption
     by any such successor of the covenants of the Note Issuer herein and in the
     Notes contained;

                                      -60-

<PAGE>

          (iii)  to add to the covenants of the Note Issuer, for the benefit of
     the Holders of the Notes, or to surrender any right or power herein
     conferred upon the Note Issuer;

          (iv)   to convey, transfer, assign, mortgage or pledge any property to
     or with the Note Trustee;

          (v)    to cure any ambiguity, to correct or supplement any provision
     herein or in any supplemental note indenture which may be inconsistent with
     any other provision herein or in any supplemental note indenture or to make
     any other provisions with respect to matters or questions arising under
     this Note Indenture or in any supplemental note indenture; provided,
     however, that such action shall not adversely affect the interests of the
     Holders of the Notes or holders of the Certificates;

          (vi)   to evidence and provide for the acceptance of the appointment
     hereunder by a successor trustee with respect to the Notes and to add to or
     change any of the provisions of this Note Indenture as shall be necessary
     to facilitate the administration of the trusts hereunder by more than one
     trustee, pursuant to the requirements of Article VI; or

          (vii)  to modify, eliminate or add to the provisions of this Note
     Indenture to such extent as shall be necessary to effect the qualification
     of this Note Indenture under the Trust Indenture Act or under any similar
     federal statute hereafter enacted and to add to this Note Indenture such
     other provisions as may be expressly required by the Trust Indenture Act.

     The Note Trustee is hereby authorized to join in the execution of any such
supplemental note indenture and to make any further appropriate agreements and
stipulations that may be therein contained.

          (b) The Note Issuer and the Note Trustee, when authorized by an Issuer
Order, may, also without the consent of any of the Holders of the Notes, 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 Note Indenture or of modifying in any manner the rights of
the Holders of the Notes under this Note Indenture; provided, however, that (i)
such action shall not, as evidenced by an Officer's Certificate, adversely
affect in any material respect the interests of the Noteholders or the holders
of Certificates and (ii) the Rating Agency Condition shall have been satisfied
with respect thereto.

     Section 9.02.  SUPPLEMENTAL NOTE INDENTURES WITH CONSENT OF NOTEHOLDERS.
The Note Issuer and the Note Trustee, when authorized by an Issuer Order, also
may, with prior notice to the Rating Agencies, the Finance Authority and with
the consent of the Holders of not less than a majority of the Outstanding Amount
of the Notes of each Class to be affected, by Act of such Holders delivered to
the Note Issuer and the Note Trustee, 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 Note Indenture or of
modifying in any manner the rights of the Holders of the Notes under this Note
Indenture; provided, however, that no such supplemental note indenture shall,
without the consent of the Holder of each Outstanding Note of each Class
affected thereby:

                                      -61-

<PAGE>

          (a) change the date of payment of any installment of principal of or
interest on any Note, or reduce the principal amount thereof or the interest
rate thereon, change the provisions of this Note Indenture relating to the
application of collections on, or the proceeds of the sale of, the Collateral to
payment of principal of or interest on the Notes, or change any place of payment
where, or the coin or currency in which, any Note or the interest thereon is
payable, or impair the right to institute suit for the enforcement of the
provisions of this Note Indenture requiring the application of funds available
therefor, as provided in Article V, to the payment of any such amount due on the
Notes on or after the respective due dates thereof (or, in the case of optional
or mandatory redemption, on or after the Optional Redemption Date or Mandatory
Redemption Date, as applicable);

          (b) reduce the percentage of the Outstanding Amount of the Notes or of
a Class thereof, the consent of the Holders of which is required for any such
supplemental note indenture, or the consent of the Holders of which is required
for any waiver of compliance with certain provisions of this Note Indenture or
certain defaults hereunder and their consequences provided for in this Note
Indenture;

          (c) modify or alter the provisions of the proviso to the definition of
the term "Outstanding";

          (d) reduce the percentage of the Outstanding Amount of the Notes
required to direct the Note Trustee to direct the Note Issuer to sell or
liquidate the Collateral pursuant to Section 5.04;

          (e) modify any provision of this Section except to increase any
percentage specified herein or to provide that certain additional provisions of
this Note Indenture or the Basic Documents cannot be modified or waived without
the consent of the Holder of each Outstanding Note affected thereby;

          (f) modify any of the provisions of this Note Indenture in such manner
as to affect the calculation of the amount of any payment of interest or
principal due on any Note on any Payment Date (including the calculation of any
of the individual components of such calculation) or to affect the rights of the
Holders of Notes to the benefit of any provisions for the mandatory redemption
of the Notes contained herein; or

          (g) permit the creation of any lien ranking prior to or on a parity
with the lien of this Note Indenture with respect to any part of the Collateral
or, except as otherwise permitted or contemplated herein, terminate the lien of
this Note Indenture on any property at any time subject hereto or deprive the
Holder of any Note of the security provided by the lien of this Note Indenture.

     The Note Trustee, after consultation with the Certificate Trustee, may in
its discretion determine whether or not any Notes or Certificates of a Class
would be affected by any supplemental note indenture and any such determination
shall be conclusive upon the Holders of all Notes and holders of all
Certificates of such Class, whether theretofore or thereafter authenticated and
delivered hereunder. Neither the Note Trustee nor the Certificate Trustee shall
be liable for any such determination made in good faith.

                                      -62-

<PAGE>

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

     Promptly after the execution by the Note Issuer and the Note Trustee of any
supplemental note indenture pursuant to this Section, the Note Issuer shall mail
to the Rating Agencies, the Certificate Trustee, the Finance Authority and the
Holders of the Notes to which such amendment or supplemental note indenture
relates a notice setting forth in general terms the substance of such
supplemental note indenture. Any failure of the Note Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental note indenture.

     Section 9.03.  EXECUTION OF SUPPLEMENTAL NOTE INDENTURES. In executing any
supplemental note indenture permitted by this Article IX or the modifications
thereby of the trusts created by this Note Indenture, the Note Trustee shall be
entitled to receive, and subject to Sections 6.01 and 6.02, shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such supplemental note indenture is authorized or permitted by this Note
Indenture. The Note Trustee may, but shall not be obligated to, enter into any
such supplemental note indenture that affects the Note Trustee's own rights,
duties, liabilities or immunities under this Note Indenture or otherwise.

     Section 9.04.  EFFECT OF SUPPLEMENTAL NOTE INDENTURE. Upon the execution of
any supplemental note indenture pursuant to the provisions hereof, this Note
Indenture shall be and be deemed to be modified and amended in accordance
therewith with respect to each Class of Notes affected thereby, and the
respective rights, limitations of rights, obligations, duties, liabilities and
immunities under this Note Indenture of the Note Trustee, the Note Issuer and
the Holders of the Notes shall thereafter be determined, exercised and enforced
hereunder subject in all respects to such modifications and amendments, and all
the terms and conditions of any such supplemental note indenture shall be and be
deemed to be part of the terms and conditions of this Note Indenture for any and
all purposes. If required by the Note Trustee, Notes may bear a notation in form
approved by the Note Trustee as to any matter provided for in such supplemental
note indenture. If the Note Issuer or the Note Trustee shall so determine, new
Notes so modified as to conform, in the opinion of the Note Trustee and the Note
Issuer, to any such supplemental note indenture may be prepared and executed by
the Note Issuer and authenticated and delivered by the Note Trustee in exchange
for Outstanding Notes.

     Section 9.05.  CONFORMITY WITH TRUST INDENTURE ACT. Every amendment of this
Note Indenture and every supplemental note indenture executed pursuant to this
Article IX shall conform to the requirements of the Trust Indenture Act as then
in effect so long as this Note Indenture shall then be qualified under the Trust
Indenture Act.

                                      -63-

<PAGE>

                                   ARTICLE X

                               REDEMPTION OF NOTES

     Section 10.01. OPTIONAL REDEMPTION BY NOTE ISSUER. The Note Issuer may, at
its option, redeem all, but not less than all, of the Notes on any Payment Date
if, after giving effect to payments that would otherwise be made on such Payment
Date, the Outstanding Amount has been reduced to less than five percent of the
initial principal balance thereof at a price equal to the outstanding principal
amount of the Notes to be redeemed plus accrued and unpaid interest thereon at
the Note Interest Rate to the Optional Redemption Date (such price being called
the "Optional Redemption Price"). If the Note Issuer shall elect to redeem the
Notes pursuant to this Section 10.01, it shall furnish written notice (which
notice shall state all items listed in Section 10.02) of such election to the
Note Trustee, the Certificate Trustees, the Finance Authority, the Rating
Agencies not later than 25 days prior to the Optional Redemption Date and shall
deposit with the Note Trustee not later than one Business Day prior to the
Optional Redemption Date the Optional Redemption Price of the Notes to be
redeemed whereupon all such Notes shall be due and payable on the Optional
Redemption Date upon the furnishing of a notice complying with Section 10.02
hereof to each Holder of the Notes pursuant to this Section 10.01.

     Section 10.02. FORM OF OPTIONAL REDEMPTION NOTICE. Notice of redemption
under Section 10.01 hereof shall be given by the Note Trustee by first-class
mail, postage prepaid, mailed not less than five days nor more than 25 days
prior to the Optional Redemption Date to each Holder of Notes to be redeemed, as
of the close of business on the Record Date preceding the Optional Redemption
Date at such Holder's address appearing in the Note Register.

     All notices of redemption shall state:

          (i)    the Optional Redemption Date;

          (ii)   the Optional Redemption Price; and

          (iii)  the place where such Notes are to be surrendered for payment of
     the Optional Redemption Price (which shall be the office or agency of the
     Note Issuer to be maintained as provided in Section 3.02 hereof).

     Notice of redemption of the Notes to be redeemed shall be given by the Note
Trustee in the name and at the expense of the Note Issuer. Failure to give
notice of redemption, or any defect therein, to any Holder of any Note selected
for redemption shall not impair or affect the validity of the redemption of any
other Note.

     Section 10.03. NOTES PAYABLE ON OPTIONAL REDEMPTION DATE OR PAYMENT DATE.
Notice of redemption having been given as provided in Section 10.02 hereof, the
Notes to be redeemed shall on the Optional Redemption Date become due and
payable at the Optional Redemption Price and (unless the Note Issuer shall
default in the payment of the Optional Redemption Price) no interest shall
accrue on the Optional Redemption Price for any period after the date to which
accrued interest is calculated for purposes of calculating the Optional
Redemption Price.

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<PAGE>

     Section 10.04. MANDATORY REDEMPTION BY NOTE ISSUER. If the Seller is
required to repurchase the Transition Property pursuant to Section 5.01(b) of
the Sale Agreement, or elects to repurchase the Transition Property pursuant to
Section 5.01(e) of the Sale Agreement, the Note Issuer shall be required to
redeem all outstanding Notes on or before the fifth Business Day following the
Repurchase Date (such date of mandatory redemption, the "Mandatory Redemption
Date") for a purchase price equal to the then outstanding principal amount of
the Notes plus accrued and unpaid interest thereon at the Note Interest Rate to
the Mandatory Redemption Date (such price being called the "Mandatory Redemption
Price"). If the Note Issuer is required to redeem the Notes pursuant to this
Section 10.04, it shall furnish written notice (which notice shall state all
items listed in Section 10.05) of such redemption to the Note Trustee, the
Certificate Trustee, the Finance Authority and the Rating Agencies not later
than one Business Day before such Repurchase Date and shall deposit with the
Note Trustee, on the Repurchase Date, the Mandatory Redemption Price of the
Notes to be redeemed whereupon all such Notes shall be due and payable on the
Mandatory Redemption Date upon the furnishing of a notice complying with Section
10.05 hereof to each Holder of the Notes pursuant to this Section 10.04.

     Section 10.05. FORM OF MANDATORY REDEMPTION NOTICE. Notice of redemption
under Section 10.04 hereof shall be given by the Note Trustee by first-class
mail, postage prepaid, mailed not less than five days prior to the Mandatory
Redemption Date to each Holder of Notes to be redeemed, as of the close of
business on the Record Date preceding the Mandatory Redemption Date at such
Holder's address appearing in the Note Register.

     All notices of redemption shall state:

          (i)    the Mandatory Redemption Date;

          (ii)   the Mandatory Redemption Price; and

          (iii)  the place where such Notes are to be surrendered for payment of
     the Mandatory Redemption Price (which shall be the office or agency of the
     Note Issuer to be maintained as provided in Section 3.02 hereof).

     Notice of redemption of the Notes to be redeemed shall be given by the Note
Trustee in the name and at the expense of the Note Issuer. Failure to give
notice of redemption, or any defect therein, to any Holder of any Note selected
for redemption shall not impair or affect the validity of the redemption of any
other Note.

     Section 10.06. NOTES PAYABLE ON MANDATORY REDEMPTION DATE OR PAYMENT DATE.
Notice of redemption having been given as provided in Section 10.05 hereof, the
Notes to be redeemed shall on the Mandatory Redemption Date become due and
payable at the Mandatory Redemption Price and (unless the Note Issuer shall
default in the payment of the Mandatory Redemption Price) no interest shall
accrue on the Mandatory Redemption Price for any period after the date to which
accrued interest is calculated for purposes of calculating the Mandatory
Redemption Price.

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<PAGE>

                                   ARTICLE XI

                                  MISCELLANEOUS

     Section 11.01. COMPLIANCE CERTIFICATES AND OPINIONS, ETC.

          (a) Upon any application or request by the Note Issuer to the Note
Trustee to take any action under any provision of this Note Indenture, the Note
Issuer shall furnish to the Note Trustee (i) an Officer's Certificate stating
that all conditions precedent, if any, provided for in this Note Indenture
relating to the proposed action have been complied with, (ii) an Opinion of
Counsel stating that in the opinion of such counsel all such conditions
precedent, if any, have been complied with and (iii) (if required by the Trust
Indenture Act) an Independent Certificate from a firm of certified public
accountants meeting the applicable requirements of this Section, except that, in
the case of any such application or request as to which the furnishing of such
documents is specifically required by any provision of this Note Indenture, no
additional certificate or opinion need be furnished.

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

          (i)    a statement that each signatory of such certificate or opinion
     has read or has caused to be read such covenant or condition and the
     definitions herein relating thereto;

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

          (iii)  a statement that, in the opinion of each such signatory, such
     signatory has made such examination or investigation as is necessary to
     enable such signatory to express an informed opinion as to whether or not
     such covenant or condition has been complied with; and

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

          (b) (i) Prior to the deposit of any Collateral or other property or
securities with the Note Trustee that is to be made the basis for the release of
any property or securities subject to the lien of this Note Indenture, the Note
Issuer shall, in addition to any obligation imposed in Section 11.01(a) or
elsewhere in this Note Indenture, furnish to the Note Trustee an Officer's
Certificate certifying or stating the opinion of each person signing such
certificate as to the fair value (within 90 days of such deposit) to the Note
Issuer of the Collateral or other property or securities to be so deposited.

          (ii)   Whenever the Note Issuer is required to furnish to the Note
     Trustee an Officer's Certificate certifying or stating the opinion of any
     signer thereof as to the matters described in clause (i) above, the Note
     Issuer shall also deliver to the Note Trustee an Independent Certificate as
     to the same matters, if the fair value to the Note Issuer of the securities

                                      -66-

<PAGE>

     to be so deposited and of all other such securities made the basis of any
     such withdrawal or release since the commencement of the then-current
     fiscal year of the Note Issuer, as set forth in the certificates delivered
     pursuant to clause (i) above and this clause (ii), is ten percent or more
     of the Outstanding Amount of the Notes, but such a certificate need not be
     furnished with respect to any securities so deposited, if the fair value
     thereof to the Note Issuer as set forth in the related Officer's
     Certificate is less than $25,000 or less than one percent of the
     Outstanding Amount of the Notes.

          (iii)  Whenever any property or securities are to be released from the
     lien of this Note Indenture other than pursuant to Section 8.02, the Note
     Issuer shall also furnish to the Note Trustee an Officer's Certificate
     certifying or stating the opinion of each person signing such certificate
     as to the fair value (within 90 days of such release) of the property or
     securities proposed to be released and stating that in the opinion of such
     person the proposed release will not impair the security under this Note
     Indenture in contravention of the provisions hereof.

          (iv)   Whenever the Note Issuer is required to furnish to the Note
     Trustee an Officer's Certificate certifying or stating the opinion of any
     signer thereof as to the matters described in clause (iii) above, the Note
     Issuer shall also furnish to the Note Trustee an Independent Certificate as
     to the same matters if the fair value of the property or securities and of
     all other property, or securities released from the lien of this Note
     Indenture (other than pursuant to Section 8.02 hereof) since the
     commencement of the then-current calendar year, as set forth in the
     certificates required by clause (iii) above and this clause (iv), equals 10
     percent or more of the Outstanding Amount of the Notes, but such
     certificate need not be furnished in the case of any release of property or
     securities if the fair value thereof as set forth in the related Officer's
     Certificate is less than $25,000 or less than one percent of the then
     Outstanding Amount of the Notes.

          (v)    Notwithstanding Section 2.11 or any other provision of this
     Section, the Note Issuer may (A) collect, liquidate, sell or otherwise
     dispose of the Transition Property and the RRB Charge as and to the extent
     permitted or required by the Basic Documents, (B) cause the Note Trustee to
     make cash payments out of the Collection Account as and to the extent
     permitted or required by the Basic Documents and (C) exercise its Legal
     Defeasance Option or its Covenant Defeasance Option, as applicable,
     pursuant to Article IV.

     Section 11.02. FORM OF DOCUMENTS DELIVERED TO NOTE TRUSTEE.

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

          (b) Any certificate or opinion of an Authorized Officer of the Note
Issuer 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

                                      -67-
<PAGE>

the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his or her certificate or
opinion is based are erroneous. Any such certificate of an Authorized Officer 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 Servicer, the Seller, the Note Issuer or the Administrator, stating that the
information with respect to such factual matters is in the possession of the
Servicer, the Seller, the Note Issuer or the Administrator, 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.

          (c) Whenever in this Note Indenture, in connection with any
application or certificate or report to the Note Trustee, it is provided that
the Note Issuer shall deliver any document as a condition of the granting of
such application, or as evidence of the Note Issuer's compliance with any term
hereof, it is intended that the truth and accuracy, at the time of the granting
of such application or at the effective date of such certificate or report (as
the case may be), of the facts and opinions stated in such document shall in
such case be conditions precedent to the right of the Note Issuer to have such
application granted or to the sufficiency of such certificate or report. The
foregoing shall not, however, be construed to affect the Note Trustee's right to
rely upon the truth and accuracy of any statement or opinion contained in any
such document as provided in Article VI.

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

     Section 11.03. ACTS OF NOTEHOLDERS.

          (a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Note Indenture to be given or taken by
Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders in person or by agents
duly appointed in writing; and except as herein otherwise expressly provided
such action shall become effective when such instrument or instruments are
delivered to the Note Trustee, and, where it is hereby expressly required, to
the Note Issuer. Such instrument or instruments (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Noteholders signing such instrument or instruments. Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Note Indenture and (subject to Section 6.01) conclusive
in favor of the Note Trustee and the Note Issuer, if made in the manner provided
in this Section.

          (b) The fact and date of the execution by any person of any such
instrument or writing may be proved in any manner that the Note Trustee deems
sufficient.

          (c) The ownership of Notes shall be proved by the Note Register.

          (d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Notes shall bind the Holder of every
Note issued upon the registration thereof or in exchange therefor or in lieu

                                      -68-

<PAGE>

thereof, in respect of anything done, omitted or suffered to be done by the Note
Trustee or the Note Issuer in reliance thereon, whether or not notation of such
action is made upon such Note.

     Section 11.04. NOTICES.

          (a) Unless otherwise specifically provided herein, all notices,
directions, consents and waivers required under the terms and provisions of this
Note Indenture shall be in English and in writing, and any such notice,
direction, consent or waiver may be given by United States mail, courier
service, facsimile transmission or electronic mail (confirmed by telephone,
United States mail or courier service in the case of notice by facsimile
transmission or electronic mail) or any other customary means of communication,
and any such notice, direction, consent or waiver shall be effective when
delivered, or if mailed, three days after deposit in the United States mail with
proper postage for ordinary mail prepaid,

     if to the Finance Authority, to:

          Office of the State Treasurer
          55 Elm Street
          Hartford, Connecticut 06103
          Attention: Assistant Treasurer - Debt Management
          Facsimile: (860) 702-3127
          Telephone: (860) 702-3034

     if to the Certificate Issuer, to:

          Connecticut RRB Special Purpose Trust CL&P-1
          c/o First Union Trust Company, National Association
          One Rodney Square
          920 King Street, 1st Floor
          Wilmington, DE 19801-7475
          Attention: Corporate Trust Administration
          Facsimile: (302) 888-7544
          Telephone: (302) 888-7500

          (with copies to the Finance Authority at the addresses listed herein)

     if to the Note Issuer, to:

          CL&P Funding LLC
          c/o The Connecticut Light and Power Company
          107 Selden Street
          Berlin, CT  06037
          Facsimile: (860) 665-5457
          Telephone: (860) 665-3258
          Email: shoopra@nu.com

                                      -69-

<PAGE>

     with a copy to:

          The Connecticut Light and Power Company
          if by U.S. Mail:
               P.O. Box 270
               Hartford, CT 06141-0270
          if by courier:
               107 Selden Street
               Berlin, CT 06037
          Attention:  Assistant Treasurer-Finance
          Facsimile: (860) 665-5457
          Telephone: (860) 665-3258
          Email: shoopra@nu.com

     if to the Note Trustee or the Certificate Trustee, to:

          First Union Trust Company, National Association
          One Rodney Square
          920 King Street, 1st Floor
          Wilmington, DE 19801-7475
          Attention:  Corporate Trust Administration
          Facsimile: (302) 888-7544
          Telephone: (302) 888-7500

     if to the Rating Agencies, to:

          Standard & Poor's Ratings Services
          55 Water Street, 40th Floor
          New York, New York 10041
          Attention: Asset Backed Surveillance Department
          Facsimile: (212) 438-2655
          Telephone: (212) 438-2001

          Moody's Investors Service
          99 Church Street
          New York, New York 10007
          Attention:  ABS Monitoring Department
          Facsimile: (212) 553-0573
          Telephone: (212) 553-3686

          and

          Fitch, Inc.
          One State Street Plaza
          New York, New York  10004
          Attention: ABS Surveillance
          Facsimile: (212) 635-0476
          Telephone: (212) 908-0200

                                      -70-

<PAGE>

     Section 11.05. NOTICES TO NOTEHOLDERS; WAIVER. Where this Note Indenture
provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid to each Noteholder affected by such
event, at such Noteholder's address as it appears on the Note Register, not
later than the latest date, and not earlier than the earliest date, prescribed
for the giving of such notice. In any case where notice to Noteholders is given
by mail, neither the failure to mail such notice nor any defect in any notice so
mailed to any particular Noteholder shall affect the sufficiency of such notice
with respect to other Noteholders, and any notice that is mailed in the manner
herein provided shall conclusively be presumed to have been duly given.

     Where this Note Indenture provides for notice in any manner, such notice
may be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Noteholders shall be filed with the Note Trustee
but such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such a waiver.

     In case, by reason of the suspension of regular mail service as a result of
a strike, work stoppage or similar activity, it shall be impractical to mail
notice of any event of Noteholders when such notice is required to be given
pursuant to any provision of this Note Indenture, then any manner of giving such
notice as shall be satisfactory to the Note Trustee shall be deemed to be a
sufficient giving of such notice.

     Where this Note Indenture provides for notice to the Rating Agencies,
failure to give such notice shall not affect any other rights or obligations
created hereunder, and shall not under any circumstance constitute a Default or
Event of Default.

     Section 11.06. CONFLICT WITH TRUST INDENTURE ACT. If any provision hereof
limits, qualifies or conflicts with another provision hereof that is required to
be included in this Note Indenture by any of the provisions of the Trust
Indenture Act, such required provision shall control.

     The provisions of Trust Indenture Act ss.ss. 310 through 317 that impose
duties on any person (including the provisions automatically deemed included
herein unless expressly excluded by this Note Indenture) are a part of and
govern this Note Indenture, whether or not physically contained herein.

     Section 11.07. EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.

     Section 11.08. SUCCESSORS AND ASSIGNS. All covenants and agreements in this
Note Indenture and the Notes by the Note Issuer shall bind its successors and
assigns, whether so expressed or not.

     All agreements of the Note Trustee in this Note Indenture shall bind its
successors.

     Section 11.09. SEVERABILITY. In case any provision in this Note Indenture
or in the Notes shall be invalid, illegal or unenforceable, the validity,
legality, and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.

                                      -71-

<PAGE>

     Section 11.10. BENEFITS OF NOTE INDENTURE. Nothing in this Note Indenture
or in the Notes, express or implied, shall give to any Person, other than the
parties hereto and their successors hereunder, and the Noteholders, and any
other party secured hereunder, and any other Person with an ownership interest
in any part of the Collateral, any benefit or any legal or equitable right,
remedy or claim under this Note Indenture.

     Section 11.11. LEGAL HOLIDAYS. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Note Indenture) payment need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.

     Section 11.12. GOVERNING LAW. THIS NOTE INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF CONNECTICUT, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. THE
PERFECTION OF ANY INTERESTS IN THE SECURITIES ACCOUNT AND THE SECURITIES
ENTITLEMENTS SHALL BE DETERMINED BY THE LAWS OF THE STATE OF CONNECTICUT.

     Section 11.13. COUNTERPARTS. This Note Indenture may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.

     Section 11.14. RECORDING OF NOTE INDENTURE. If this Note Indenture is
subject to recording in any appropriate public recording offices, such recording
is to be effected by the Note Issuer and at its expense accompanied by an
Opinion of Counsel (which may be counsel to the Note Trustee or any other
counsel reasonably acceptable to the Note Trustee) to the effect that such
recording is necessary either for the protection of the Noteholders or any other
Person secured hereunder or for the enforcement of any right or remedy granted
to the Note Trustee under this Note Indenture.

     Section 11.15. NO RECOURSE TO CERTAIN PERSONS. No recourse may be taken,
directly or indirectly, with respect to the obligations of the Note Issuer or
the Note Trustee on the Notes or under this Note Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Note Trustee in its individual capacity, (ii) any owner of a membership interest
in the Note Issuer or (iii) any partner, owner, beneficiary, agent, officer,
director or employee of the Note Trustee in its individual capacity, any holder
of a membership interest in the Note Issuer or the Note Trustee or of any
successor or assign of the Note Trustee in its individual capacity, except as
any such Person may have expressly agreed (it being understood that the Note
Trustee has no such obligations in its individual capacity).

     Section 11.16. NO RECOURSE TO NOTE ISSUER. Notwithstanding any provision of
this Note Indenture or any Supplemental Note Indenture to the contrary,
Noteholders shall have no recourse against the Note Issuer, but shall look only
to the Collateral, with respect to any amounts due to the Noteholders hereunder.

                                      -72-

<PAGE>

     Section 11.17. INSPECTION. The Note Issuer agrees that, on reasonable prior
notice, it will permit any representative of the Note Trustee, during the Note
Issuer's normal business hours, to examine all the books of account, records,
reports, and other papers of the Note Issuer, to make copies and extracts
therefrom, to cause such books to be audited by Independent certified public
accountants, and to discuss the Note Issuer's affairs, finances and accounts
with the Note Trustee's officers, employees, and Independent certified public
accountants, all at such reasonable times and as often as may be reasonably
requested. The Note Trustee shall and shall cause its representatives to hold in
confidence all such information except to the extent disclosure may be required
by law (and all reasonable applications for confidential treatment are
unavailing) and except to the extent that the Note Trustee may reasonably
determine that such disclosure is consistent with its obligations hereunder.
Notwithstanding anything herein to the contrary, the foregoing shall not be
construed to prohibit (i) disclosure of any and all information that is or
becomes publicly known, or information obtained by the Note Trustee from sources
other than the Note Issuer, provided such parties are rightfully in possession
of such information and do not have an obligation of confidentiality, (ii)
disclosure of any and all information (A) if required to do so by any applicable
statute, law, rule or regulation, (B) pursuant to any subpoena, civil
investigative demand or similar demand or request of any court or regulatory
authority exercising its proper jurisdiction, (C) in any preliminary or final
offering circular, registration statement or contract or other document
pertaining to the transactions contemplated by this Note Indenture or the Basic
Documents approved in advance by the Note Issuer or (D) to any affiliate,
independent or internal auditor, agent, employee or attorney of the Note Trustee
having a need to know the same, provided that such parties agree to be bound by
the confidentiality provisions contained in this Section 11.17, or (iii) any
other disclosure authorized by the Note Issuer.

     Section 11.18. NONPETITION COVENANTS. Notwithstanding any prior termination
of this Note Indenture, but subject to the DPUC's right to order the
sequestration and payment of revenues arising with respect to the Transition
Property notwithstanding any bankruptcy, reorganization or other insolvency
proceedings with respect to the debtor, pledgor or transferor of the Transition
Property pursuant to Sections 16-245k(e) and 16-245k(g) of the Statute, the Note
Trustee shall not, prior to the date which is one year and one day after the
termination of this Note Indenture with respect to the Note Issuer, petition or
otherwise invoke or cause the Note Issuer or the Certificate Issuer to invoke
the process of any court or governmental authority for the purpose of commencing
or sustaining a case against the Note Issuer or the Certificate Issuer under any
federal or state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of the Note Issuer or the Certificate Issuer or any substantial part of the
property of the Note Issuer or the Certificate Issuer, or ordering the winding
up or liquidation of the affairs of the Note Issuer or the Certificate Issuer.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                      -73-

<PAGE>

     IN WITNESS WHEREOF, the Note Issuer and the Note Trustee have caused this
Note Indenture to be duly executed by their respective officers, thereunto duly
authorized, all as of the day and year first above written.

                                       CL&P FUNDING LLC

                                       By:______________________________________
                                          Name:
                                          Title:

                                       FIRST UNION TRUST COMPANY,
                                       NATIONAL ASSOCIATION,
                                       not in its individual capacity but solely
                                       as Note Trustee,

                                       By:______________________________________
                                          Name:
                                          Title:

                                     -S-1-

<PAGE>

                                   SCHEDULE 1

                         EXPECTED AMORTIZATION SCHEDULE

                          OUTSTANDING PRINCIPAL BALANCE

Payment Date    Class A-1    Class A-2    Class A-3    Class A-4    Class A-5
------------    ---------    ---------    ---------    ---------    ---------
Issuance Date             $            $            $            $             $

                                     -1-1-

<PAGE>

                                   SCHEDULE 2

                  REQUIRED OVERCOLLATERALIZATION LEVEL SCHEDULE

Payment Date           Required          Payment Date           Required
                Overcollateralization                    Overcollateralization
                         Level                                    Level
                                       $                                       $

                                     -2-1-

<PAGE>

                                    EXHIBIT A

                                  FORM OF NOTE

REGISTERED

NO. [   ]                                                                 $[   ]

                       SEE REVERSE FOR CERTAIN DEFINITIONS

     THE PRINCIPAL OF THIS CLASS A-[ ] NOTE WILL BE PAID IN INSTALLMENTS AS SET
FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS CLASS A-[ ]
NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.

                             CL&P FUNDING LLC NOTES

                                   CLASS A-[ ]

     Note Interest Rate       Original Principal Amount      Final Maturity Date
           [    ]%                $[                 ]

PRINCIPAL AMOUNT:

     CL&P Funding LLC, a limited liability company formed and existing under the
laws of the State of Delaware (herein referred to as the "Note Issuer"), for
value received, hereby promises to pay to Connecticut RRB Special Purpose Trust
CL&P-1, or registered assigns, the Original Principal Amount shown above in
quarterly installments on the Payment Dates and in the amounts specified on the
reverse hereof or, if less, the amounts determined pursuant to Section 8.02 of
the Note Indenture, in each year, commencing on the date determined as provided
on the reverse hereof and ending on or before the Final Maturity Date and to pay
interest, at the Interest Rate shown above, on each [___________,___________,
___________ and __________] or if any such day is not a Business Day, the next
succeeding Business Day, commencing on __________ __, 2001 and continuing until
the earlier of the payment of the principal hereof or the Final Maturity Date
(each a "Payment Date"), on the principal amount of this Class A-[ ] Note.
Interest on this Class A-[ ] Note will accrue for each Payment Date from the
most recent Payment Date on which interest has been paid to but excluding such
Payment Date or, if no interest has yet been paid, from [ ], 2001. Interest will
be computed on the basis of a 360-day year of twelve 30-day months. Such
principal of and interest on this Class A-[ ] Note shall be paid in the manner
specified on the reverse hereof.

     The principal of and interest on this Class A-[ ] Note are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts. All payments made by the
Note Issuer with respect to this Class A-[ ] Note shall be applied first to

                                     -A-1-

<PAGE>

interest due and payable on this Class A-[ ] Note as provided above and then to
the unpaid principal of this Class A-[ ] Note, all in the manner set forth in
Section 8.02 of the Note Indenture.

     Reference is made to the further provisions of this Class A-[ ] Note set
forth on the reverse hereof, which shall have the same effect as though fully
set forth on the face of this Class A-[ ] Note.

     Unless the certificate of authentication hereon has been executed by the
Note Trustee whose name appears below by manual signature, this Class A-[ ] Note
shall not be entitled to any benefit under the Note Indenture referred to on the
reverse hereof, or be valid or obligatory for any purpose.

     IN WITNESS WHEREOF, the Note Issuer has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer.

Date: [         ], ______

                                       CL&P FUNDING LLC

                                       By:______________________________________
                                          Name:
                                          Title:

                                     -A-2-

<PAGE>

                  NOTE TRUSTEE'S CERTIFICATE OF AUTHENTICATION

Dated: [          ], ______

     This is one of the Notes referred to in the within-mentioned Note
Indenture.

                                       FIRST UNION TRUST COMPANY,
                                       NATIONAL ASSOCIATION,
                                       not in its individual capacity but solely
                                       as Note Trustee,

                                       By:______________________________________
                                          Name:
                                          Title:

                                     -A-3-

<PAGE>

                                [REVERSE OF NOTE]

     This Class A-[ ] Note is one of a duly authorized issue of Notes of the
Note Issuer, designated as its CL&P Funding LLC Notes (herein called the
"Notes"), issuable in one or more Classes, and further designated as a Class A-[
] Note (collectively with all other Class A-[ ] Notes of this issue, the "Class
A-[ ] Notes"), all issued under a Note Indenture dated as of March __, 2001
(together with all amendments and supplements thereto, the "Note Indenture"),
between the Note Issuer and First Union Trust Company, National Association, as
Note Trustee (the "Note Trustee," which term includes any successor trustee
under the Note Indenture), to which Note Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights and obligations thereunder of the Note Issuer, the Note Trustee and the
Holders of the Notes. All terms used in this Class A-[ ] Note that are defined
in the Note Indenture shall have the meanings assigned to them in the Note
Indenture.

     The Class A-[ ] Notes and the other Classes of Notes issued by the Note
Issuer are and will be equally and ratably secured by the collateral pledged as
security therefor, as provided in the Note Indenture.

     The principal of this Class A-[ ] Note shall be payable on each Payment
Date only to the extent that amounts in the Collection Account are available
therefor, and only until the outstanding principal balance thereof on such
Payment Date (after giving effect to all payments of principal, if any, made on
such Payment Date) has been reduced to the principal balance specified in the
Expected Amortization Schedule which is attached to the Note Indenture as
Schedule 1, unless payable earlier either because (x) an Event of Default shall
have occurred and be continuing and the Note Trustee or the Holders of Notes
representing not less than a majority of the Outstanding Amount of the Notes
have declared the Notes to be immediately due and payable in accordance with
Section 5.02 of the Note Indenture, (y) the Note Issuer, at its option, shall
have called for the redemption of the Notes pursuant to Section 10.01 of the
Note Indenture or (z) the Note Issuer shall have called for the redemption of
the Notes pursuant to Section 10.04 of the Note Indenture if the Seller is
required to repurchase the Transition Property pursuant to Section 5.01(b) of
the Sale Agreement. However, actual principal payments may be made in lesser
than expected amounts and at later than expected times as determined pursuant to
Section 8.02 of the Note Indenture. The entire unpaid principal amount of this
Class A-[ ] Note shall be due and payable on the earlier of the Final Maturity
Date hereof, the Optional Redemption Date, if any, and the Mandatory Redemption
Date, if any, herefor. Notwithstanding the foregoing, the entire unpaid
principal amount of the Notes shall be due and payable, if not then previously
paid, on the date on which an Event of Default shall have occurred and be
continuing and the Note Trustee or the Holders of the Notes representing not
less than a majority of the Outstanding Amount of the Notes have declared the
Notes to be immediately due and payable in the manner provided in Section 5.02
of the Note Indenture. All principal payments on the Class A-[ ] Notes shall be
made pro rata to the Class A-[ ] Noteholders entitled thereto based on the
respective principal amounts of the Class A-[ ] Notes held by them.

                                     -A-4-

<PAGE>

     Payments of interest on this Class A-[ ] Note due and payable on each
Payment Date, together with the installment of principal shall be made by check
mailed first-class, postage prepaid, to the Person whose name appears as the
Registered Holder of this Class A-[ ] Note (or one or more Predecessor Notes) on
the Note Register as of the close of business on the Record Date, except that
with respect to Notes registered on the Record Date in the name of the
Certificate Trustee, payments will be made by wire transfer in immediately
available funds to the account designated by the Certificate Trustee and except
for the final installment of principal payable with respect to this Class A-[ ]
Note on a Payment Date which shall be payable as provided below. Such checks
shall be mailed to the Person entitled thereto at the address of such Person as
it appears on the Note Register as of the applicable Record Date without
requiring that this Class A-[ ] Note be submitted for notation of payment. Any
reduction in the principal amount of this Class A-[ ] Note (or any one or more
Predecessor Notes) effected by any payments made on any Payment Date shall be
binding upon all future Holders of this Class A-[ ] Note and of any Note issued
upon the registration of transfer hereof or in exchange hereof or in lieu
hereof, whether or not noted hereon. If funds are expected to be available, as
provided in the Note Indenture, for payment in full of the then remaining unpaid
principal amount of this Class A-[ ] Note on a Payment Date, then the Note
Trustee, in the name of and on behalf of the Note Issuer, will notify the Person
who was the Registered Holder hereof as of the Record Date preceding such
Payment Date by notice mailed no later than five days prior to such final
Payment Date and shall specify that such final installment will be payable only
upon presentation and surrender of this Class A-[ ] Note and shall specify the
place where this Class A-[ ] Note may be presented and surrendered for payment
of such installment.

     The Note Issuer shall pay interest on overdue installments of interest at
the Note Interest Rate to the extent lawful.

     As provided in the Note Indenture, the Class A-[ ] Notes may be redeemed,
in whole but not in part, at the option of the Note Issuer on any Payment Date
at the Optional Redemption Price if, after giving effect to payments that would
otherwise be made on such Payment Date, the Outstanding Amount of the Notes has
been reduced to less than five percent of the initial principal balance thereof.
In addition, as provided in the Note Indenture, if the Seller is required to
repurchase the Transition Property pursuant to Section 5.01(b) of the Sale
Agreement, the Note Issuer will be required to redeem all outstanding Notes,
including the Class A-[ ] Notes, on or before the fifth Business Day following
the Repurchase Date (as defined in the Sale Agreement).

     As provided in the Note Indenture and subject to certain limitations set
forth therein, the transfer of this Class A-[ ] Note may be registered on the
Note Register upon surrender of this Class A-[ ] Note for registration of
transfer at the office or agency designated by the Note Issuer pursuant to the
Note Indenture, duly endorsed by, or accompanied by (a) a written instrument of
transfer in form satisfactory to the Note Trustee duly executed by the Holder
hereof or his attorney duly authorized in writing, with such signature
guaranteed by an institution which is a member of one of the following
recognized Signature Guaranty Programs: (i) The Securities Transfer Agent
Medallion Program (STAMP); (ii) The New York Stock Exchange Medallion Program

                                     -A-5-

<PAGE>

(MSP); (iii) The Stock Exchange Medallion Program (SEMP); or (iv) in such other
guarantee program acceptable to the Note Trustee, and (b) such other documents
as the Note Trustee may require, and thereupon one or more new Class A-[ ] Notes
of Minimum Denominations and in the same aggregate principal amount will be
issued to the designated transferee or transferees. No service charge will be
charged for any registration of transfer or exchange of this Class A-[ ] Note,
but the transferor may be required to pay a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any such
registration of transfer or exchange, other than exchanges pursuant to Section
2.04 of the Note Indenture not involving any transfer.

     Each Noteholder, by acceptance of a Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Note Issuer or the Note Trustee on the Notes or under the Note Indenture
or any certificate or other writing delivered in connection therewith, against
(i) the Note Trustee in its individual capacity, (ii) any owner of a membership
interest in the Note Issuer or (iii) any partner, owner, beneficiary, agent,
officer, director or employee of the Note Trustee in its individual capacity,
any holder of a membership interest in the Note Issuer or the Note Trustee or of
any successor or assign of the Note Trustee in its individual capacity, except
as any such Person may have expressly agreed (it being understood that the Note
Trustee has no such obligations in its individual capacity).

     Prior to the due presentment for registration of transfer of this Class A-[
] Note, the Note Issuer, the Note Trustee and any agent of the Note Issuer or
the Note Trustee may treat the Person in whose name this Class A-[ ] Note is
registered (as of the day of determination) as the owner hereof for the purpose
of receiving payments of principal of and interest on this Class A-[ ] Note and
for all other purposes whatsoever, whether or not this Class A-[ ] Note be
overdue, and neither the Note Issuer, the Note Trustee nor any such agent shall
be affected by notice to the contrary.

     The Note Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Note Issuer and the rights of the Holders of the Notes under the Note Indenture
at any time by the Note Issuer with the consent of the Holders of Notes
representing a majority of the Outstanding Amount of all Notes at the time
Outstanding of each Class to be affected. The Note Indenture also contains
provisions permitting the Holders of Notes representing specified percentages of
the Outstanding Amount of the Notes, on behalf of the Holders of all the Notes,
to waive compliance by the Note Issuer with certain provisions of the Note
Indenture and certain past defaults under the Note Indenture and their
consequences. Any such consent or waiver by the Holder of this Class A-[ ] Note
(or any one of more Predecessor Notes) shall be conclusive and binding upon such
Holder and upon all future Holders of this Class A-[ ] Note and of any Note
issued upon the registration of transfer hereof or in exchange hereof or in lieu
hereof whether or not notation of such consent or waiver is made upon this Class
A-[ ] Note. The Note Indenture also permits the Note Trustee to amend or waive
certain terms and conditions set forth in the Note Indenture without the consent
of Holders of the Notes issued thereunder.

                                     -A-6-

<PAGE>

     The term "Note Issuer" as used in this Class A-[ ] Note includes any
successor to the Note Issuer under the Note Indenture.

     The Note Issuer is permitted by the Note Indenture, under certain
circumstances, to merge or consolidate, subject to the rights of the Note
Trustee and the Holders of Notes under the Note Indenture.

     The Class A-[ ] Notes are issuable only in registered form in denominations
as provided in the Note Indenture, subject to certain limitations therein set
forth.

     This Class A-[ ] Note and the Note Indenture shall be construed in
accordance with the laws of the State of Connecticut, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder and thereunder shall be determined in accordance with such
laws.

     No reference herein to the Note Indenture and no provision of this Class
A-[ ] Note or of the Note Indenture shall alter or impair the obligation of the
Note Issuer, which is absolute and unconditional, to pay the principal of and
interest on this Class A-[ ] Note at the times, place, and rate, and in the coin
or currency herein prescribed.

     The Holder of this Class A-[ ] Note by the acceptance hereof agrees that,
notwithstanding any provision of the Note Indenture to the contrary, the Holder
shall have no recourse against the Note Issuer, but shall look only to the
Collateral, with respect to any amounts due to the Holder under this Class A-[ ]
Note.

                                     -A-7-

<PAGE>

                                   ASSIGNMENT

     Social Security or taxpayer I.D. or other identifying number of assignee:
_________________

     FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto

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

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

                         (name and address of assignee)

the within Class A-[ ] Note and all rights thereunder, and hereby irrevocably
constitutes and appoints __________________, attorney, to transfer said Class
A-[ ] Note on the books kept for registration thereof, with full power of
substitution in the premises.

Dated:  _______________________________       __________________________________
                                              Signature Guaranteed:

_______________________________________       __________________________________

_______________________________

*    NOTE: The signature to this assignment must correspond with the name of the
     registered owner as it appears on the face of the within Class A-[ ] Note
     in every particular, without alteration, enlargement or any change
     whatsoever.

                                     -A-8-================================================================================

                  CONNECTICUT RRB SPECIAL PURPOSE TRUST CL&P-1,
                              as Certificate Issuer

                FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION,
                               as Delaware Trustee

                                       and

                FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION,
                             as Certificate Trustee

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

                              CERTIFICATE INDENTURE

                           Dated as of March __, 2001

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

                                $----------------
                  CONNECTICUT RRB SPECIAL PURPOSE TRUST CL&P-1
                           RATE REDUCTION CERTIFICATES

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

                                TABLE OF CONTENTS

                                                                            PAGE

ARTICLE I                 DEFINITIONS..........................................2

           Section 1.01.  Definitions..........................................2

           Section 1.02.  Compliance Certificates and Opinions................12

           Section 1.03.  Form of Documents Delivered to Certificate Trustee..13

           Section 1.04.  Acts of Certificateholders..........................14

ARTICLE II                THE CERTIFICATES....................................15

           Section 2.01.  Terms of the Certificates...........................15

           Section 2.02.  Issuance of Certificates............................18

           Section 2.03.  Form, Denomination and Execution of Certificates....20

           Section 2.04.  Authentication of Certificates......................21

           Section 2.05.  Temporary Certificates..............................21

           Section 2.06.  Registration of Transfer and Exchange
                          of Certificates.....................................21

           Section 2.07.  Certificateholders' Lists and
                          Reports by Certificate Trustee......................22

           Section 2.08.  Mutilated, Destroyed, Lost or Stolen Certificates...23

           Section 2.09.  Persons Deemed Owners...............................24

           Section 2.10.  Cancellation........................................24

           Section 2.11.  Limitation of Liability for Payments................24

           Section 2.12.  Book-Entry and Definitive Certificates..............25

           Section 2.13.  Tax Treatment.......................................26

ARTICLE III               COVENANTS...........................................26

           Section 3.01.  Compliance with Declaration of Trust................26

           Section 3.02.  No Additional Certificates..........................27

           Section 3.03.  Swap Agreements.....................................27

           Section 3.04.  Listing Agent, Paying Agent, Transfer Agent.........29

           Section 3.05.  Swap Agreement Covenants............................29

ARTICLE IV                DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS.....31

           Section 4.01.  Certificate Accounts................................31

           Section 4.02.  Distributions from Certificate Accounts.............31

           Section 4.03.  Statements to Certificateholders....................33

           Section 4.04.  Investment of Special Payment Moneys................34

           Section 4.05.  Reduction in Principal..............................35

<PAGE>

                                TABLE OF CONTENTS
                                  (CONTINUED)
                                                                            PAGE

ARTICLE V                 DEFAULTS............................................35

           Section 5.01.  Events of Default...................................35

           Section 5.02.  Incidents of Sale of Notes..........................36

           Section 5.03.  Judicial Proceedings Instituted by
                          Certificate Trustee; Certificate Trustee
                          May Bring Suit......................................36

           Section 5.04.  Control by Certificateholders.......................37

           Section 5.05.  Waiver of Past Defaults.............................37

           Section 5.06.  Right of Certificateholders To Receive
                          Payments Not To Be Impaired.........................38

           Section 5.07.  Certificateholders May Not Bring Suit
                          Except Under Certain Conditions.....................38

           Section 5.08.  Remedies Cumulative.................................39

ARTICLE VI                THE CERTIFICATE TRUSTEE.............................39

           Section 6.01.  Notice of Defaults..................................39

           Section 6.02.  Certain Rights of Certificate Trustee...............39

           Section 6.03.  Not Responsible for Recitals or
                          Issuance of Certificates............................41

           Section 6.04.  May Hold Certificates...............................41

           Section 6.05.  Money Held in Trust.................................41

           Section 6.06.  Compensation and Reimbursement; Indemnification.....41

           Section 6.07.  Corporate Certificate Trustee Required; Eligibility.43

           Section 6.08.  Resignation and Removal; Appointment of Successor...43

           Section 6.09.  Acceptance of Appointment by Successor..............45

           Section 6.10.  Merger, Conversion, Consolidation or
                          Succession to Business..............................46

           Section 6.11.  Maintenance of Agencies.............................46

           Section 6.12.  Money for Certificate Payments To Be Held in Trust..47

           Section 6.13.  Registration of Notes in Certificate
                          Trustee's Name......................................48

           Section 6.14.  Representations and Warranties
                          of Certificate Trustee..............................48

           Section 6.15.  Withholding Taxes; Information Reporting............49

ARTICLE VII               SUPPLEMENTAL CERTIFICATE INDENTURES.................49

           Section 7.01.  Supplemental Certificate Indentures Without
                          Consent of Certificateholders.......................49

           Section 7.02.  Supplemental Certificate Indentures
                          With Consent of Certificateholders..................50

           Section 7.03.  Documents Affecting Immunity or Indemnity...........51

                                       ii
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                                TABLE OF CONTENTS
                                  (CONTINUED)
                                                                            PAGE

           Section 7.04.  Execution of Supplemental Certificate Indentures;
                          Notification Under Rules of Luxembourg Stock
                          Exchange............................................51

           Section 7.05.  Effect of Supplemental Certificate Indentures.......51

           Section 7.06.  Conformity with Trust Indenture Act.................52

           Section 7.07.  Reference in Certificates to Supplemental
                          Certificate Indentures..............................52

           Section 7.08.  Swap Counterparty Consent...........................52

           Section 7.09.  Delaware Trustee....................................52

ARTICLE VIII              AMENDMENTS AND SUPPLEMENTS TO NOTES,
                          NOTE INDENTURE AND OTHER BASIC DOCUMENTS............52

           Section 8.01.  Amendments and Supplements to Notes,
                          Note Indenture and Other Basic Documents............52

ARTICLE IX                SATISFACTION AND DISCHARGE..........................53

           Section 9.01.  Satisfaction and Discharge of Certificate Indenture.53

ARTICLE X                 MISCELLANEOUS PROVISIONS............................54

           Section 10.01. State Pledge; Certificates and Notes Not
                          Obligations of the State of Connecticut, Finance
                          Authority or Seller.................................54

           Section 10.02. Limitation on Rights of Certificateholders..........55

           Section 10.03. No Recourse to Certificate Issuer...................55

           Section 10.04. Certificates Nonassessable and Fully Paid...........55

           Section 10.05. Notices.............................................56

           Section 10.06. Governing Law.......................................58

           Section 10.07. Severability of Provisions..........................58

           Section 10.08. Conflict With Trust Indenture Act...................58

           Section 10.09. Effect of Headings and Table of Contents............59

           Section 10.10. Successors and Assigns; Delegation..................59

           Section 10.11. Benefits of Certificate Indenture...................59

           Section 10.12. Legal Holidays......................................59

           Section 10.13. Counterparts........................................59

           Section 10.14. The Delaware Trustee................................59

           Section 10.15. Nonpetition Covenants...............................59

                                      iii
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                                TABLE OF CONTENTS
                                   (CONTINUED)
                                                                            PAGE

           Exhibit A-1    Form of Class A-1, A-2, A-3 or A-5 Certificate

           Exhibit A-2    Form of Class A-4 Certificate

           Exhibit B      Calculation of LIBOR

                                      -iv-
<PAGE>

      CERTIFICATE INDENTURE, dated as of March __, 2001, between CONNECTICUT RRB
SPECIAL PURPOSE TRUST CL&P-1, a Delaware business trust (the "Certificate
Issuer") formed under the Declaration of Trust, FIRST UNION TRUST COMPANY,
NATIONAL ASSOCIATION, as Delaware trustee (the "Delaware Trustee"), and FIRST
UNION TRUST COMPANY, NATIONAL ASSOCIATION, as certificate trustee (the
"Certificate Trustee").

                                    RECITALS

      The Note Issuer intends to issue its CL&P Funding LLC Notes (the "Notes")
with an aggregate principal amount of $__________, consisting of Classes A-1
through A-5, pursuant to the Note Indenture. In order to finance the purchase of
the Notes pursuant to the Note Purchase Agreement relating to the Notes, the
Certificate Issuer shall issue, pursuant to this Certificate Indenture, its
Connecticut RRB Special Purpose Trust CL&P-1 Rate Reduction Certificates (the
"Certificates") with an aggregate principal amount of $_____________, consisting
of Classes A-1 through A-5, each of which shall represent a fractional undivided
beneficial interest in the corresponding Class of Notes and the related Swap
Agreement, if any, and the proceeds thereof.

      The Certificate Issuer has duly authorized the execution and delivery of
this Certificate Indenture to provide the terms and conditions for the issuance
of the Certificates. The Certificate Issuer is entering into this Certificate
Indenture, and the Certificate Trustee is accepting the trusts created hereby,
for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged.

                                 GRANTING CLAUSE

      The Certificate Issuer hereby grants to the Certificate Trustee on the
Issuance Date, as Certificate Trustee for the benefit of the Holders of the
Certificates and the Swap Counterparties (as more fully defined herein, the
"Secured Parties"), all of the Certificate Issuer's right, title and interest in
and to the Notes acquired pursuant to the Note Purchase Agreement and, solely
for the benefit of the related floating rate Class of Certificates, each Swap
Agreement, together with all payments thereon and proceeds thereof, and other
property constituting the Trust Property relating to each such Class of Notes,
all as provided in this Certificate Indenture.

      The foregoing grant is made in trust to secure the payment of principal of
and interest on, and any other amounts owing in respect of, the Certificates,
and to secure compliance with the provisions of this Certificate Indenture with
respect to the Certificates and the Swap Agreements, all as provided in this
Certificate Indenture. This Certificate Indenture constitutes a security
agreement within the meaning of the UCC to the extent that, under Connecticut
law, the provisions of the UCC are applicable hereto.

      The Certificate Trustee, as trustee on behalf of the Secured Parties,
acknowledges such grant, accepts the trusts hereunder in accordance with the
provisions hereof and agrees to perform its duties herein required.

      AND IT IS HEREBY COVENANTED, DECLARED AND AGREED between the parties
hereto that all Certificates are to be issued, countersigned and delivered and
that all of the Trust Property is to be held and applied, subject to the further
covenants, conditions, releases, uses and trusts hereinafter set forth, and the
Certificate Issuer, for itself and any successor, does hereby covenant and agree
<PAGE>

to and with the Certificate Trustee and its successors in said trust, for the
benefit of the Secured Parties, as follows:

                                    ARTICLE I

                                   DEFINITIONS

           Section 1.01. DEFINITIONS.

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

         (i) a term has the meaning assigned to it;

         (ii) an accounting term not otherwise defined has the meaning assigned
     to it in accordance with generally accepted accounting principles as in
     effect from time to time;

         (iii) "or" is not exclusive;

         (iv) "including" means including without limitation;

         (v) words in the singular include the plural and words in the plural
     include the singular;

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

         (vii) all references in this Certificate Indenture to designated
     "Articles," "Sections" and other subdivisions are to the designated
     Articles, Sections and other subdivisions of this Certificate Indenture;
     and

         (viii) Whenever this Certificate Indenture refers to a provision of the
     Trust Indenture Act, the provision is incorporated by reference in and made
     a part of this Certificate Indenture. The following Trust Indenture Act
     terms used in this Certificate Indenture have the following meanings:

         "Commission" means the Securities and Exchange Commission.

         "indenture securities" means the Certificates.

         "indenture security holder" means a Certificateholder.

         "indenture to be qualified" means this Certificate Indenture.

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

         "obligor" on the indenture securities means the Certificate Issuer and
         any other obligor on the indenture securities.

                                      -2-
<PAGE>

           All other Trust Indenture Act terms used in this Certificate
Indenture that are defined by the Trust Indenture Act, defined by Trust
Indenture Act reference to another statute or defined by Commission rule have
the meaning assigned to them by such definitions.

           "ACT," when used with respect to any Certificateholder, has the
meaning specified in Section 1.04.

           "APPROVED REPLACEMENT COUNTERPARTY" has the meaning set forth in
Section 3.03.

           "AUTHENTICATION AGENT" means the authentication agent appointed
pursuant to Section 6.11.

           "AUTHORIZED AGENT" means any Paying Agent, Authentication Agent or
Certificate Registrar.

           "AUTHORIZED REPRESENTATIVE" means, with respect to any entity, any
person who is authorized to act for such entity in matters relating to such
entity and who is identified on the list of Authorized Representatives or
Authorized Officers delivered by such entity to the Certificate Trustee on the
Issuance Date (as such list may be modified or supplemented from time to time
thereafter).

           "AVOIDABLE TAX" has the meaning set forth in Section 6.08(f).

           "BOOK-ENTRY CERTIFICATES" means, with respect to any Certificate, a
beneficial interest in such Certificate, ownership and transfers of which shall
be made through book entries by a Clearing Agency as described in Section 2.12.

           "BUSINESS DAY" means any day other than a Saturday, a Sunday or a day
on which banking institutions or trust companies in New York, New York,
Hartford, Connecticut or Wilmington, Delaware are authorized or obligated by
law, regulation or executive order to remain closed.

           "BUSINESS TRUST STATUTE" shall mean Chapter 38 of Title 12 of the
Delaware Code, 12 Del.C.,ss. 3801 et seq., as the same may be amended from time
to time and any successor statute.

           "CERTIFICATE ACCOUNT" means, with respect to any Class of
Certificates, the account or accounts created and maintained with respect to
such Class of Certificates pursuant to Section 4.01(a).

           "CERTIFICATE INDENTURE" means this instrument as originally executed
and, as from time to time supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
as so supplemented or amended or both, and shall include the forms and terms of
the Certificates established hereunder.

           "CERTIFICATE OWNER" means the Person who owns a Book-Entry
Certificate.

           "CERTIFICATE REGISTER" has the meaning set forth in Section 2.06.

                                      -3-
<PAGE>

           "CERTIFICATE REGISTRAR" means, initially, the Certificate Trustee,
pursuant to Section 2.06, and any successor registrar that meets the eligibility
standards specified in Section 6.11(b).

           "CERTIFICATE TRUSTEE" means First Union Trust Company, National
Association, as Certificate Trustee under this Certificate Indenture, and its
successors in interest, and any successor Certificate Trustee appointed as
provided herein.

           "CERTIFICATE TRUSTEE EXPENSES" has the meaning set forth in Section
6.06.

           "CERTIFICATE TRUSTEE INDEMNIFIED PERSONS" has the meaning set forth
in Section 6.06.

           "CERTIFICATEHOLDER" or "HOLDER" means the Person in whose name a
Certificate is registered on the Certificate Register.

           "CERTIFICATES" has the meaning set forth in Section 2.01(a).

           "CLASS" means any one of the classes of Certificates; and, with
respect to the Notes, any one of the classes of Notes.

           "CLASS A-4 CERTIFICATES" means the Certificates of Class A-4.

           "CLASS A-4 GROSS FIXED AMOUNT" with respect to any Distribution Date
means an amount equal to the product of the Class A-4 Gross Fixed Rate times the
Outstanding Amount of the Class A-4 Certificates as of the close of business on
the preceding Distribution Date after giving effect to all payments of principal
made to the Holders of the Class A-4 Certificates on such preceding Distribution
Date (or, with respect to the initial Distribution Date, the original principal
amount of the Class A-4 Certificates), which product (i) in the case of each
Distribution Date other than the initial Distribution Date shall be divided by
4, and (ii) in the case of the initial Distribution Date, shall be multiplied by
the actual number of days from and including the Issuance Date to but excluding
the initial Distribution Date and be divided by 360.

           "CLASS A-4 GROSS FIXED RATE" has the meaning set forth in Section
2.01.

           "CLASS A-4 INTEREST DETERMINATION DATE" means, with respect to a
Distribution Date, the day two London Banking Days prior to such Distribution
Date, or, in the case of the initial Distribution Date, both the day two London
Banking Days prior to the Issuance Date and _________ 2001.

           "CLASS A-4 SWAP AGREEMENT" means the Original Class A-4 Swap
Agreement and any replacement Swap Agreement relating to the Class A-4
Certificates entered into pursuant to Section 3.03.

           "CLASS A-4 SWAP COUNTERPARTY" means the Swap Counterparty under the
Class A-4 Swap Agreement.

           "CLEARING AGENCY" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act.

                                      -4-
<PAGE>

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

           "CORPORATE TRUST OFFICE" means the principal office of the
Certificate Trustee at which at any particular time its corporate trust business
shall be administered, which office at the date of the execution of this
Certificate Indenture is located at the address provided in Section 10.05, or at
such other address as the Certificate Trustee may designate from time to time by
notice to the Certificateholders and the Certificate Issuer, or the principal
corporate trust office of any successor Certificate Trustee (the address of
which the successor Certificate Trustee will notify the Certificateholders and
the Certificate Issuer).

           "DECLARATION OF TRUST" means the Declaration of Trust, relating to
the creation of the Certificate Issuer, dated as of March __, 2001 by First
Union Trust Company, National Association, as Delaware Trustee, and the Finance
Authority as settlor thereunder pursuant to the Statute, as the same may be
amended, supplemented or otherwise modified from time to time.

           "DEFINITIVE CERTIFICATES" has the meaning set forth in Section
2.12(a).

           "DISTRIBUTION DATE" means, with respect to the Certificates, a
Payment Date with respect to the Notes.

           "DTC AGREEMENT" means the agreement between the Certificate Trustee,
on behalf of the Certificate Issuer, and The Depository Trust Company, as the
initial Clearing Agency, dated as of March __, 2001, relating to the
Certificates, as the same may be amended and supplemented from time to time.

           "ELIGIBLE DEPOSIT ACCOUNT" means either (a) a segregated trust
account with an Eligible Institution or (b) a segregated trust account with the
corporate trust department of a depository institution organized under the laws
of the United States of America or any one of the states thereof or the District
of Columbia (or any domestic branch of a foreign bank), having corporate trust
powers and acting as trustee for funds deposited in such account, so long as any
of the securities of such depository institution shall have a credit rating from
each Rating Agency in one of its generic rating categories which signifies
investment grade.

           "ELIGIBLE INSTITUTION" means (a) the corporate trust department of
the Certificate Trustee or (b) a depository institution organized under the laws
of the United States of America, any State or the District of Columbia (or any
domestic branch of a foreign bank), (i) which has either (A) with respect to any
Eligible Investment having a maturity of greater than one month, a long-term
unsecured debt rating of AAA by Standard & Poor's and Fitch and Aaa by Moody's
or (B) with respect to any Eligible Investment having a maturity of one month or
less, a certificate of deposit rating of A-1+ by Standard & Poor's, F1+ by Fitch
and P-1 by Moody's, or any other long-term, short-term or certificate of deposit
rating acceptable to Standard & Poor's and Moody's and (ii) whose deposits are
insured by the FDIC. If so qualified under clause (b) above, the Certificate
Trustee may be considered an Eligible Institution for the purposes of clause (a)
of the definition of Eligible Deposit Account.

                                      -5-
<PAGE>

           "ELIGIBLE INVESTMENTS" mean book-entry securities, negotiable
instruments or securities represented by instruments in bearer or registered
form which evidence:

                     (a) direct obligations of, and obligations fully and
            unconditionally guaranteed as to timely payment by, the United
            States of America;

                     (b) demand deposits, time deposits or certificates of
           deposit of any depository institution or trust company (any
           depositary institution or trust company being referred to in this
           definition as a "financial institution") incorporated under the laws
           of the United States or any state thereof (or any domestic branch of
           a foreign bank) and subject to supervision and examination by federal
           or state banking or depositary institution authorities; provided,
           however, that at the time of the investment or contractual commitment
           to invest therein, the commercial paper or other short-term unsecured
           debt obligations (other than such obligations the rating of which is
           based on the credit of a Person other than such depositary
           institution or trust company) thereof shall have a credit rating from
           each of the Rating Agencies in the highest investment category
           granted thereby; meeting the requirements of clause (e) of the
           definition of Eligible Institution;

                     (c) commercial paper or other short term obligations of any
            corporation organized under the laws of the United States of America
            (other than the Seller or its Affiliates) whose ratings, at the time
            of the investment or contractual commitment to invest therein, from
            each of the Rating Agencies are in the highest investment category
            granted thereby;

                     (d) demand deposits, time deposits and certificates of
            deposit which are fully insured by the Federal Deposit Insurance
            Corporation;

                     (e) investments in money market funds having a rating from
            each of the Rating Agencies in the highest investment category
            granted thereby (including funds for which the Certificate Trustee
            or any of its Affiliates act as investment manager or advisor);

                     (f) banker's acceptances issued by any depositary
            institution or trust company referred to in clause (b) above;

                     (g) repurchase obligations with respect to any security
            that is a direct obligation of, or fully guaranteed by, the United
            States or any agency or instrumentality thereof the obligations of
            which are backed by the full faith and credit of the United States,
            in either case entered into with a depository institution or trust
            company (acting as principal) described in clause (b) above;

                     (h) repurchase obligations with respect to any security or
            whole loan entered into with

                               (i) a financial institution (acting as principal)
                     described in clause (b) above and, with respect to Moody's
                     only, a minimum long-term unsecured rating of A1,

                                       -6-
<PAGE>

                               (ii) a broker/dealer (acting as principal)
                     registered as a broker or dealer under Section 15 of the
                     Exchange Act (any broker/dealer being referred to in this
                     definition as a "broker/dealer"), the unsecured short-term
                     debt obligations of which are rated P-1 by Moody's and A-1+
                     by Standard & Poor's at the time of entering into this
                     repurchase obligation and with respect to Moody's only, a
                     minimum long-term unsecured rating of A1, or

                               (iii) an unrated broker/dealer, acting as
                     principal, that is a wholly-owned subsidiary of a non-bank
                     or bank holding company, the unsecured short-term debt
                     obligations of which are rated P-1 by Moody's and A-1+ by
                     Standard & Poor's at the time of purchase; or

                     (i) any other investment permitted by each Rating Agency;

provided, however, that, with respect to Moody's only, the obligor related to
clauses (b), (c), (d), (f), (g) and (h) above must have both a long term rating
of at least A1 and a short term rating of at least P-1, and provided, further,
that, unless otherwise permitted by each Rating Agency, upon the failure of any
Eligible Institution to maintain any applicable rating set forth in this
definition or the definition of Eligible Institution, the related investments at
such institution shall be reinvested in Eligible Investments at a successor
Eligible Institution within 10 days.

           "EVENT OF DEFAULT" means, with respect to the Certificates, (i) a
Note Event of Default, or (ii) a breach by State of Connecticut of the State
Pledge described in Section 10.01(a).

           "FDIC" means the Federal Deposit Insurance Corporation or any
successor.

           "FEE AND INDEMNITY AGREEMENT" means the fee and indemnity agreement
dated as of March __, 2001, among the Note Issuer, the Delaware Trustee, the
Certificate Trustee, the Certificate Issuer and the Finance Authority, as
amended and supplemented from time to time.

           "FINAL TERMINATION DATE" means, with respect to any Class of
Certificates, the Final Maturity Date of the related Class of Notes.

           "FINANCE AUTHORITY" means the State of Connecticut, acting through
the office of the State Treasurer.

           "INTEREST RATE" has the meaning set forth in Section 2.01(b).

           "LIBOR" means a rate per annum equal to the London interbank offered
rate for three-month United States dollar deposits, calculated by the
Certificate Trustee according to the procedure in Exhibit B hereto.

           "LONDON BANKING DAY" means a day on which dealings in United States
dollars are transacted in the London interbank market.

           "MINIMUM DENOMINATION" means $1,000 or any integral multiple of $1.00
in excess thereof; provided, however, that one Certificate of each Class may be
of a smaller denomination.

                                      -7-
<PAGE>

           "NOTE EVENT OF DEFAULT" means, with respect to the Notes, any Event
of Default (as such term is defined in the Note Indenture).

           "NOTE INDENTURE" means the Note Indenture dated as of March __, 2001
between the Note Issuer and the Note Trustee, as amended and supplemented from
time to time.

           "NOTE ISSUER" means CL&P Funding LLC, a Delaware limited liability
company, and its successors in interest.

           "NOTE PURCHASE AGREEMENT" means the Note Purchase Agreement dated as
of March __, 2001, between the Note Issuer and the Certificate Issuer, as the
same may be amended or supplemented from time to time.

           "NOTE TRUSTEE" means the Person acting as Note Trustee under the Note
Indenture.

           "NOTES" has the meaning set forth in the recitals to this Certificate
Indenture.

           "OFFICER'S CERTIFICATE" means a certificate signed by any Authorized
Representative of the Certificate Issuer, under the circumstances described in,
and otherwise complying with, the applicable requirements of Section 1.02, and
delivered to the Certificate Trustee.

           "OPINION OF COUNSEL" means one or more written opinions of counsel
who may, except as otherwise expressly provided in this Certificate Indenture,
be an employee of or counsel to the Certificate Issuer and who shall be
reasonably satisfactory to the Certificate Trustee, and which opinion or
opinions shall be addressed to the Certificate Trustee, as trustee, shall comply
with any applicable requirements of Section 1.02, and shall be in form and
substance reasonably satisfactory to the Certificate Trustee.

           "ORIGINAL CLASS A-4 SWAP AGREEMENT" means the Swap Agreement dated as
of March __, 2001, between the Certificate Issuer and [___________], as the Swap
Counterparty thereunder, relating to the Class A-4 Certificates.

           "ORIGINAL PRINCIPAL AMOUNT" means, with respect to any Certificate,
the amount set forth as such on the face of such Certificate on the date of its
issuance.

           "OUTSTANDING" means, as of the date of determination, all
Certificates theretofore authenticated and delivered under this Certificate
Indenture except:

                (i) Certificates theretofore cancelled by the Certificate
           Registrar or delivered to the Certificate Registrar for cancellation;

                (ii) Certificates or portions thereof the payment for which
           money in the necessary amount has been theretofore deposited with the
           Certificate Trustee or any Paying Agent in trust for the Holders of
           such Certificates (provided, however, that if such Certificates are
           to be redeemed, notice of such redemption has been duly given
           pursuant to this Certificate Indenture or provision therefor,
           reasonably satisfactory to the Certificate Trustee, has been made);
           and

                                      -8-
<PAGE>

                (iii) Certificates in exchange for or in lieu of other
           Certificates that have been authenticated and delivered pursuant to
           this Certificate Indenture unless proof satisfactory to the
           Certificate Trustee is presented that any such Certificates are held
           by a bona fide purchaser;

provided, however, that in determining whether the Holders of the requisite
Outstanding Amount of the Certificates or any Class thereof have given any
request, demand, authorization, direction, notice, consent or waiver hereunder
or under any Basic Document, Certificates owned by the Note Issuer, the
Certificate Issuer, any other obligor upon the Certificates, the Seller, or any
Affiliate of any of the foregoing Persons shall be disregarded and deemed not to
be Outstanding, except that, in determining whether the Certificate Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Certificates that a Responsible
Officer of the Certificate Trustee actually knows to be so owned shall be so
disregarded. Certificates so owned that have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Certificate Trustee the pledgee's right so to act with respect to such
Certificates and that the pledgee is not the Note Issuer, any other obligor upon
the Certificates, the Certificate Issuer, the Seller, or any Affiliate of any of
the foregoing Persons.

           "OUTSTANDING AMOUNT" means the aggregate principal amount of all
Certificates, or, if the context requires, all Certificates of a Class,
Outstanding at the date of determination.

           "PAYING AGENT" means the Certificate Trustee or any other Person that
meets the eligibility standards specified in Section 6.11(b) and is authorized
by the Certificate Issuer (with the prior written approval of the Note Issuer)
to make distributions of principal of or interest with respect to the
Certificates.

           "PAYMENT" means, with respect to the Notes, any payment (other than a
Special Payment but including any Redemption Payment) of principal of or
interest thereon.

           "PAYMENT DATE" means, with respect to the Notes, the date or dates
specified as Payment Dates therefor in the Note Indenture.

           "PERSON" means any individual, corporation, limited liability
company, estate, partnership, joint venture, association, joint stock company,
trust (including any beneficiary thereof), unincorporated organization or
government or any agency or political subdivision thereof.

           "QUALIFIED REPLACEMENT COUNTERPARTY" means a Replacement Counterparty
that (i) has the Swap Counterparty Minimum Ratings or (ii) enters into such
other arrangements as will result in the Class A-4 Certificates receiving
ratings not less than the ratings that would be received if such Replacement
Counterparty satisfied the Swap Counterparty Minimum Ratings.

           "RECORD DATE" means, with respect to any Distribution Date, the close
of business on the Business Day immediately preceding such Distribution Date or,
if Definitive Certificates are issued, the close of business on the last day of
the calendar month preceding the calendar month in which such Distribution Date
occurs.

                                      -9-
<PAGE>

           "REDEMPTION PAYMENT" means, with respect to the Notes, any payment of
principal of and interest on the Notes due from the Note Issuer upon the early
redemption of the Notes, other than any such payment due by reason of the
occurrence of a Note Event of Default.

           "REPLACEMENT COUNTERPARTY" has the meaning set forth in Section 3.03.

           "REQUEST" means a written request by the Certificate Issuer setting
forth the subject matter of the request accompanied by an Officer's Certificate
and an Opinion of Counsel as provided in Section 1.02.

           "RESPONSIBLE OFFICER" means any officer within the Corporate Trust
Office, including any Managing Director, Vice President, Assistant Vice
President, Secretary, Assistant Secretary or Assistant Treasurer or any other
officer of the Certificate Trustee customarily performing functions similar to
those performed by any of the above designated officers and also, with respect
to a particular matter, any other officer to whom such matter is referred
because of such officer's knowledge and familiarity with the particular subject.

           "SALE AGREEMENT" means the Transition Property Purchase and Sale
Agreement dated as of March __, 2001, between the Seller and the Note Issuer, as
amended and supplemented from time to time.

           "SCHEDULED FINAL DISTRIBUTION DATE" means, with respect to any Class
of Certificates, the Scheduled Maturity Date of the related Class of Notes.

           "SECURED PARTIES" means the Holders of the Certificates of each
Class, and the Swap Counterparties with respect to the Class A-4 Notes, as their
interests appear hereunder.

           "SECURITIES ACT" means the Securities Act of 1933, as amended.

           "SELLER" means The Connecticut Light and Power Company, a Connecticut
corporation, and its permitted successors and assigns under the Sale Agreement.

           "SERVICER" means The Connecticut Light and Power Company, a
Connecticut corporation, in its capacity as servicer under the Servicing
Agreement, including its successors in interest, until a successor Person shall
have become the servicer pursuant to the Servicing Agreement, and thereafter
"Servicer" shall mean such successor Person.

           "SERVICING AGREEMENT" means the Transition Property Servicing
Agreement dated as of March __, 2001, between the Servicer and the Note Issuer,
as amended and supplemented from time to time.

           "SPECIAL DISTRIBUTION DATE" means, with respect to the distribution
of any Special Payment with respect to any Class of Notes, the later of (i) the
date receipt of such Special Payment is confirmed by the Certificate Trustee and
(ii) the date that is the earlier of (A) if the Certificate Trustee shall have
received such Special Payment without prior notice thereof, 20 days after such
receipt is confirmed or (B) unless such Special Payment represents the proceeds
of a sale of such Notes by the Certificate Trustee (in which event the Special
Distribution Date for such proceeds shall be the earliest date for which it is
practicable for the

                                      -10-
<PAGE>

Certificate Trustee to give the 20-day notice required by Section 4.02(d)), the
date that is 20 days after the Certificate Trustee receives notice from the Note
Issuer of the anticipated payment of such Special Payment; provided, however,
that in the event of the repurchase of the Transition Property by the Seller,
the Special Distribution Date shall mean a date not later than five Business
Days after receipt of such proceeds.

           "SPECIAL PAYMENT" means, with respect to any Class of Notes, (i) any
payment of principal of or interest on (including any interest accruing upon
default), or any other amount in respect of, the Notes of such Class that is
paid more than five days after the Payment Date applicable thereto or (ii) any
proceeds from the sale of such Notes by the Certificate Trustee pursuant to
Article V hereof or the repurchase of the Transition Property by the Seller
pursuant to Article V of the Sale Agreement.

           "SPECIAL RECORD DATE" means, with respect to any Special Distribution
Date, the close of business on the 15th day (whether or not a Business Day)
preceding such Special Distribution Date.

           "STATE PLEDGE" has the meaning set forth in Section 10.01(a).

           "STATE TREASURER" means the Treasurer of the State of Connecticut.

           "SWAP AGENT" has the meaning set forth in Section 3.03.

           "SWAP AGREEMENT" means any interest rate swap agreement entered into
by the Certificate Issuer with respect to any Class of Certificates, including,
without limitation, the ISDA Master Agreement and the related Schedule and
Confirmation between the Certificate Issuer and a Swap Counterparty, as same may
be amended or supplemented from time to time.

           "SWAP COUNTERPARTY" means, with respect to any Swap Agreement, the
swap counterparty under that Swap Agreement.

           "SWAP COUNTERPARTY MINIMUM RATINGS" means at least "Aa3" by Moody's,
at least "A+" or "A-1" by Standard & Poor's and, if rated by Fitch, at least
"A+" or "F1".

           "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 as in
force on the date hereof, unless otherwise specifically provided.

           "TRUST PROPERTY" means, with respect to any Class of Certificates,
the Class of Notes and Swap Agreement, if any, corresponding to such Class of
Certificates held as the property of the Certificate Issuer and all monies at
any time paid thereon and all monies due and to become due thereunder, all
rights of the Certificate Trustee or the Certificate Issuer, as holder of such
Class of Notes, in and to the Collateral and any proceeds thereof, funds from
time to time deposited in the Certificate Account for such Class of Certificates
and any proceeds from the sale by the Certificate Trustee pursuant to Article V
hereof of Notes of such Class.

           "UNDERWRITERS" means the underwriters who purchase the Certificates
from the Certificate Issuer and sell the Certificates in a public offering.

                                      -11-
<PAGE>

         (b) Except as otherwise specified herein or as the context may
otherwise require, the following terms have the respective meanings set forth in
the Note Indenture as in effect on the Issuance Date for all purposes of this
Certificate Indenture.

                                                                   SECTION OF
                               TERM                              NOTE INDENTURE

Administrator...........................................            1.01(a)
Affiliate...............................................            1.01(a)
Basic Documents.........................................            1.01(a)
Capital Subaccount......................................            1.01(a)
Code....................................................            1.01(a)
Collateral..............................................            1.01(a)
DPUC....................................................            1.01(a)
Exchange Act............................................            1.01(a)
Expected Amortization Schedule..........................            1.01(b)
Final Maturity Date.....................................            1.01(a)
Financing Order.........................................            1.01(b)
Fitch...................................................            1.01(a)
Issuance Date...........................................            1.01(a)
Moody's.................................................            1.01(a)
Rating Agency...........................................            1.01(a)
Rating Agency Condition.................................            1.01(a)
Scheduled Maturity Date.................................            1.01(a)
Standard & Poor's.......................................            1.01(a)
State...................................................            1.01(a)
Statute.................................................            1.01(a)
Transition Property.....................................            1.01(b)
UCC.....................................................            1.01(a)

         (c) When reference is made herein to the Certificates of any Class,
such reference shall mean the Certificates of such Class.

Section 1.02. COMPLIANCE CERTIFICATES AND OPINIONS. Upon any application or
request by the Certificate Issuer to the Certificate Trustee to take any action
under any provision of this Certificate Indenture, the Certificate Issuer shall
furnish to the Certificate Trustee an Officer's Certificate stating that, in the
opinion of the signer thereof, all conditions precedent, if any, provided for in
this Certificate Indenture relating to the proposed action have been complied
with and, if requested by the Certificate Trustee, an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent, if any, have
been complied with, except that in the case of any such application or request
as to which the furnishing of such documents is specifically required by any
provision of this Certificate Indenture relating to such particular application
or request, no additional certificate or opinion need be furnished. Any such
application or request by the Certificate Issuer to the Certificate Trustee
shall also be accompanied by evidence reasonably satisfactory to the Certificate
Trustee that the Note Issuer has given its prior written approval of such
application or request.

                                      -12-
<PAGE>

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

         (a) a statement that each signatory of such certificate or opinion has
read or caused to be read such covenant or condition and the definitions herein
relating thereto;

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

         (c) a statement that, in the opinion of each such signatory, such
signatory has made such examination or investigation as is necessary to enable
such signatory 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 signatory,
such condition or covenant has been complied with.

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

         Any certificate or opinion of an Authorized Representative of the
Certificate Issuer 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 of an
Authorized Representative 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 Servicer, the Seller, the Note Issuer or the
Administrator, stating that the information with respect to such factual matters
is in the possession of the Servicer, the Seller, the Note Issuer or the
Administrator, as the case may be, unless such officer or 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.

         Whenever in this Certificate Indenture, in connection with any
application or certificate or report to the Certificate Trustee, it is provided
that the Certificate Issuer shall deliver any document as a condition of the
granting of such application, or as evidence of the Certificate Issuer's
compliance with any term hereof, it is intended that the truth and accuracy, at
the time of the granting of such application or at the effective date of such
certificate or report (as the case may be), of the facts and opinions stated in
such document shall in such case be conditions precedent to the right of the
Certificate Issuer to have such application granted or to the sufficiency of
such certificate or report. The foregoing shall not, however, be construed to
affect the Certificate Trustee's right to rely upon the truth and accuracy of
any statement or opinion contained in any such document as provided in Article
VI.

                                      -13-
<PAGE>

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

         Section 1.04. ACTS OF CERTIFICATEHOLDERS.

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

         (b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner that the Certificate Trustee
deems sufficient.

         (c) The ownership of Certificates shall be proved by the Certificate
Register.

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

         (e) The Certificate Issuer may at its option by delivery of an
Officer's Certificate to the Certificate Trustee set a record date to determine
the Holders of any Class of Certificates entitled to give any consent, request,
demand, authorization, direction, notice, waiver or other Act. Notwithstanding
316(c) of the Trust Indenture Act, such record date shall be the record date
specified in such Officer's Certificate, which shall be the date not more than
30 days prior to the first solicitation of Certificateholders in connection
therewith. If such a record date is fixed, such consent, request, demand,
authorization, direction, notice, waiver or other Act may be given before or
after such record date, but only the Holders of Certificates of the applicable
Class at the close of business on such record date shall be deemed to be
Certificateholders of such Class for the purposes of determining whether Holders
of the requisite aggregate Outstanding Amount of Certificates of such Class have
authorized or agreed or consented to such consent, request, demand,
authorization, direction, notice, waiver or other Act, and for that purpose the
aggregate Outstanding Amount of Certificates of such Class shall be computed as
of such record date; provided, however, that no such consent, request, demand,
authorization, direction, notice, waiver or other Act by the Holders of

                                      -14-
<PAGE>

Certificates of such Class on such record date shall be deemed effective unless
it shall become effective pursuant to the provisions of this Certificate
Indenture not later than one year after the record date.

         (f) Except as otherwise provided in the definition of Outstanding,
Certificates of any Class owned by or pledged to any Person shall have an equal
and proportional benefit under the provisions of this Certificate Indenture,
without preference, priority or distinction as among all of the Certificates of
that Class.

                                   ARTICLE II

                                THE CERTIFICATES

         Section 2.01. TERMS OF THE CERTIFICATES.

         (a) AUTHORIZATION; DESIGNATION. The issuance of the Certificates is
hereby authorized and the Certificates shall be designated generally as the
Connecticut RRB Special Purpose Trust CL&P-1 Rate Reduction Certificates (the
"Certificates"), and further designated as Classes A-1 through A-5. Each such
Class shall be in an aggregate principal amount equal to the corresponding Class
of Notes as set forth in the Note Purchase Agreement.

         (b) INITIAL PRINCIPAL AMOUNT; CERTIFICATE INTEREST RATE; SCHEDULED
FINAL DISTRIBUTION DATE; FINAL TERMINATION DATE. The Certificates of each Class
shall have the initial principal amount, bear interest at the rates per annum
(each an "Interest Rate") and shall have Scheduled Final Distribution Dates and
Final Termination Dates as set forth below:
<TABLE>
<CAPTION>

      Class        Initial Principal     Interest Rate      Scheduled Final  Final Termination
                       Amount                              Distribution Date       Date
<S>     <C>    <C>                            <C>         <C>                    <C>
       A-1         $                          %

       A-2         $                          %

       A-3         $                          %

       A-4         $                          (Floating)

       A-5         $                          %
</TABLE>

         (c) Computation and Distribution of Interest. The interest payable on
the Certificates, Class A-1, Class A-2, Class A-3 and Class A-5, for any
Distribution Date shall be computed on the basis of a 360-day year of twelve
30-day months or, for the initial Distribution Date, the number of days from and
including the Issuance Date to but excluding the initial Distribution Date. The
interest payable on the Class A-4 Certificates for any Distribution Date shall
be computed as set forth below.

           Notwithstanding the foregoing, upon the termination of the Class A-4
Swap Agreement for any reason and for so long as there is no replacement Class
A-4 Swap Agreement in effect, the Class A-4 Certificates shall bear interest at
the fixed rate of [___] percent per annum (the "Class A-4 Gross Fixed Rate"),

                                      -15-
<PAGE>

effective from and including the Distribution Date preceding such termination.
The Class A-4 Gross Fixed Rate shall be computed on the basis of a 360-day year
of twelve 30-day months or, for the initial Distribution Date, the number of
days from and including the Issuance Date to but excluding the initial
Distribution Date. At such time as the Certificate Issuer enters into a
replacement Class A-4 Swap Agreement pursuant to Section 3.03, the Class A-4
Certificates shall revert to the interest rate of LIBOR plus [0.___] percent,
commencing to accrue as of the next Distribution Date following the date such
replacement Class A-4 Swap Agreement becomes effective and computed on the basis
of the actual number of days elapsed and a 360-day year.

           On each Distribution Date after the initial Distribution Date,
interest will be payable on the Certificates in an amount equal to: (1) with
respect to the Certificates, Class A-1, Class A-2, Class A-3 and Class A-5,
one-quarter and (2) with respect to the Class A-4 Certificates, the actual
number of days since the preceding Distribution Date divided by 360, times the
product of:

                (i) the applicable Interest Rate times

                (ii) the Outstanding Amount of the related Class of Certificates
           as of the close of business on the preceding Distribution Date after
           giving effect to all payments of principal made to the Holders of the
           related Class of Certificates on such preceding Distribution Date.

           With respect to the initial Distribution Date, interest will be
payable in an amount equal to:

                (i) with respect to the Certificates, Class A-1, Class A-2,
           Class A-3 and Class A-5, the actual number of days from and including
           the Issuance Date to, but excluding, the initial Distribution Date
           divided by 360, times the product of:

                    (A) the applicable Interest Rate for such Class times

                    (B) the original principal amount of such Class of
           Certificates as of the Issuance Date; and

                (ii) with respect to the Class A-4 Certificates, the sum of

                    (A) the actual number of days from and including the
           Issuance Date up to and including ______________, 2001, divided by
           360, times the product of: (1) LIBOR plus [0.__]% times (2) the
           original principal amount of the Class A-4 Certificates, plus

                    (B) 91/360 of the product of (1) LIBOR (calculated on
           _____________, 2001) plus [0.__]% times (2) the original principal
           amount of the Class A-4 Certificates.

           (d) Floating Rate Subaccount. Upon the issuance of the Class A-4
Certificates, the Certificate Trustee will establish and maintain a Certificate
Account (the "Class A-4 Subaccount"), which the Certificate Trustee will hold in

                                      -16-
<PAGE>

trust for the benefit of the Holders of the Class A-4 Certificates and so long
as the Swap Counterparty is not in default under the Swap, the Swap
Counterparty, on a pari passu basis. On the Business Day preceding each
Distribution Date, but subject to any proration among Classes in the case of a
Note shortfall of funds available to pay interest on the Certificates pursuant
to Section 8.02(d) of the Note Indenture, the Certificate Trustee shall allocate
to the Class A-4 Subaccount an amount equal to the Class A-4 Gross Fixed Amount
with respect to such Distribution Date. On that Business Day, any net amount
payable by the Certificates Issuer to the Class A-4 Swap Counterparty under the
Class A-4 Swap Agreement shall be paid from the Class A-4 Subaccount, and any
net amount payable to the Certificate Issuer by the Class A-4 Swap Counterparty
under the Class A-4 Swap Agreement shall be deposited into the Class A-4
Subaccount. On the related Distribution Date, amounts in the Class A-4
Subaccount after such netting and payment shall be paid as interest to the
Holders of the Class A-4 Certificates.

           If, on any Distribution Date for any Calculation Period during which
the Class A-4 Swap Agreement is in effect, there are insufficient funds in the
Class A-4 Subaccount to pay the interest due to the Holders of the Class A-4
Certificates because of a failure of the Class A-4 Swap Counterparty to pay any
net amount payable by the Class A-4 Swap Counterparty under the Class A-4 Swap
Agreement, the Class A-4 Holders shall have no recourse to amounts in any other
Certificate Account to recover such shortfall other than from amounts
subsequently paid by the Class A-4 Swap Counterparty.

           If for any Distribution Date there are insufficient funds in the
Class A-4 Subaccount to pay the interest due to the Holders of the Class A-4
Certificates and to pay any net amount payable to the Class A-4 Swap
Counterparty by the Certificate Issuer under the Class A-4 Swap Agreement
because of a shortfall of funds available for the Certificate Trustee to
allocate to the Class A-4 Subaccount the full amount of the Class A-4 Fixed
Gross Amount with respect to such Distribution Date, amounts in the Class A-4
Subaccount shall be distributed to the Holders of the Class A-4 Certificates and
the Class A-4 Swap Counterparty on a pari passu and pro rata basis based on the
relative amounts payable to the Swap Counterparty and the Holders of the Class
A-4 Certificates.

           (e) Allocation of Amounts in Class A-4 Subaccount. Notwithstanding
anything to the contrary herein (except Section 3.03(d)), so long as the Class
A-4 Swap Counterparty (or any replacement Swap Counterparty) is not in default
under the Class A-4 Swap Agreement (or any replacement Swap Agreement), all Note
payments deposited into the Class A-4 Subaccount shall be applied first, to make
any net payment payable to the Swap Counterparty (provided that if there is a
default in the payment of interest on the Class A-4 Note and Section 3.03 is not
yet applicable, amounts shall be applied to the payment of the Swap Counterparty
and the Class A-4 Noteholders on a pro rata basis), any remaining amounts shall
be allocated and distributed to Class A-4 Certificateholders as provided in
Section 4.02(c).

           (f) Notification of Libor. On each Interest Determination Date, the
Certificate Trustee will notify the Servicer, the Certificate Issuer and the
Swap Counterparty of LIBOR for the applicable period as determined by the
Certificate Trustee, and the Certificate Issuer will notify the Luxembourg Stock
Exchange of that rate to the extent any floating rate certificates are listed on
that exchange and the rules of that exchange so require.

                                      -17-
<PAGE>

           Section 2.02. ISSUANCE OF CERTIFICATES. On the Issuance Date, the
Certificate Issuer, subject to the provisions of this Certificate Indenture and
the Note Purchase Agreement, shall issue, and the Delaware Trustee shall execute
on behalf of the Certificate Issuer and the Certificate Trustee shall
authenticate and deliver, in fully registered form only, the Certificates of the
Class corresponding to the Class of Notes issued on such Issuance Date, all in
accordance with the Note Purchase Agreement. Each Certificate represents a
fractional undivided beneficial interest in a corresponding Class of Notes and
the proceeds thereof. Prior to the execution and authentication of the
Certificates of any Class, the Certificate Trustee shall have received the
following:

           (a) The Class of Notes, duly executed by the Note Issuer and
authenticated by the Note Trustee, corresponding to the Class of Certificates to
be issued;

           (b) A certificate of an Authorized Representative of the Note Issuer
to the effect that all conditions required to be satisfied under Section 2.10 of
the Note Indenture for the issuance of such Class of Notes and all conditions
required to be satisfied under the Note Purchase Agreement for the purchase of
the Notes by the Certificate Issuer have been satisfied, together with executed
copies of all documents, certificates, opinions, orders or approvals
establishing satisfaction of such conditions;

           (c) An order of an Authorized Representative of the Certificate
Issuer (i) directing the Delaware Trustee on behalf of the Certificate Issuer to
execute and deliver this Certificate Indenture to be executed in connection with
the Certificates to be issued hereunder, (ii) directing the Delaware Trustee on
behalf of the Certificate Issuer to execute and deliver the Note Purchase
Agreement and (iii) directing the Delaware Trustee to execute and deliver on
behalf of the Certificate Issuer, and the Certificate Trustee to authenticate,
as Authentication Agent, global Certificates, each to be registered in the name
of Cede & Co., as nominee of The Depository Trust Company ("DTC"), and to
confirm its custody of the Certificates to DTC in New York, New York so that the
Certificate may be credited to or upon the order of the Underwriters named in
said order for the purchase price specified therein and directing the
application of the proceeds thereof;

           (d) An Opinion of Counsel, portions of which may be delivered by
counsel to the Certificate Issuer and portions of which may be delivered by
counsel to the Certificate Trustee or other counsel satisfactory to the
Certificate Trustee, dated the Issuance Date in each case subject to the
customary exceptions, qualifications and assumptions contained therein (which
may include, for the purpose of the Issuance Date, the assumption that the
Financing Order has been duly authorized by the DPUC and is in full force and
effect), to the effect that:

                (i) this Certificate Indenture has been duly authorized,
           executed and delivered by the Certificate Issuer and Delaware
           Trustee;

                (ii) this Certificate Indenture constitutes a valid and binding
           agreement of the Certificate Issuer and Delaware Trustee, enforceable
           in accordance with its terms except as enforcement thereof may be
           subject to or limited by bankruptcy, insolvency, moratorium,
           reorganization, fraudulent conveyance or other similar laws relating
           to or affecting the enforcement of creditors' rights generally and by
           general equitable principles (regardless of whether such

                                      -18-
<PAGE>

           enforceability is considered in a proceeding in equity or at law),
           including that the availability of specific enforcement or injunctive
           relief is subject to the discretion of the court before which any
           such proceeding is brought;

                (iii) all instruments furnished to the Certificate Trustee as
           conditions precedent to the delivery of the Certificates conform to
           the requirements of this Certificate Indenture and constitute all
           documents required to be delivered thereunder to authorize the
           Certificate Trustee to execute, authenticate and deliver the
           Certificates;

                (iv) the Certificates to be issued have been duly authorized and
           executed and, when authenticated in accordance with the provisions of
           this Certificate Indenture and delivered to and paid for by the
           Underwriters pursuant to the Underwriting Agreement dated March __,
           2001, among the Seller, the Note Issuer and Lehman Brothers Inc. and
           Salomon Smith Barney Inc., as the representatives of the several
           underwriters named therein, will represent valid, fully paid and
           nonassessable undivided beneficial interests in the assets of the
           Certificate Issuer, entitled to the benefits of this Certificate
           Indenture;

                (v) the Note Purchase Agreement has been duly executed and
           delivered by the Delaware Trustee on behalf of the Certificate Issuer
           and, assuming due authorization, execution and delivery thereof by
           the Note Issuer, constitutes a legal, valid and binding agreement of
           the Certificate Issuer, enforceable against the Certificate Issuer in
           accordance with its terms except as enforcement thereof may be
           subject to or limited by bankruptcy, insolvency, moratorium,
           reorganization, fraudulent conveyance or other similar laws relating
           to or affecting the enforcement of creditors' rights generally and by
           general equitable principles (regardless of whether such
           enforceability is considered in a proceeding in equity or at law),
           including that the availability of specific enforcement or injunctive
           relief is subject to the discretion of the court before which any
           such proceeding is brought;

                (vi) the Certificate Issuer is a duly organized and validly
           existing business trust under the Business Trust Statute and is in
           good standing;

                (vii) this Certificate Indenture has been duly qualified under
           the Trust Indenture Act or no such qualification is necessary;

                (viii) the Certificate Issuer constitutes a "financing entity"
           under Section 16-245e(a) of the Statute, and the Certificates
           constitute "rate reduction bonds" under Section 16-245e(a) of the
           Statute and the Holders of the Certificates are entitled to the
           rights and benefits thereunder;

                (ix) for Federal income tax purposes, the Certificate Issuer is
           not a business entity classified as a corporation or a publicly
           traded partnership treated as a corporation, but is a "grantor trust"
           not taxable as a corporation;

                (x) the Statute creates, upon the effective date of the
           Financing Order, a first priority lien in the Transition Property
           securing all obligations, then existing or subsequently arising, to

                                      -19-
<PAGE>

           the Holders of the Certificates in respect of such Certificates or to
           the Certificate Trustee in its capacity as such; and

                (xi) such other matters as the Certificate Trustee may
           reasonably require.

           (e) Sufficient funds to pay the purchase price for the related Class
of Notes, as specified in Section 1(b) of the Note Purchase Agreement;

           (f) The Rating Agency Condition shall have been satisfied with
respect to the issuance of the Class of Certificates; and

           (g) With respect to the Class A-4 Certificates, an executed copy of
the Class A-4 Swap Agreement.

           Section 2.03. FORM, DENOMINATION AND EXECUTION OF CERTIFICATES. The
Certificates shall be issued in registered form without coupons and shall be
substantially in the form attached hereto as EXHIBIT A-1 (in the case of Class
A-1, A-2, A-3 or A-5 Certificates) or EXHIBIT A-2 (in the case of Class A-4
Certificates), with the following filled in: (a) the designation of the Classes
thereof, which shall be the same designation as the related Class or Classes of
Notes, (b) the Certificate number or numbers thereof, (c) the date of
authentication thereof, which shall be the same as the Issuance Date of the
related Class or Classes of Notes, and (d) the Original Principal Amount
thereof, which shall equal, in the aggregate, the principal amount of the Notes;
and with such omissions, variations and insertions as are permitted by this
Certificate Indenture, and may have such letters, numbers or other marks of
identification and such legends or endorsements printed, lithographed or
engraved thereon as may be required to comply with the rules of any securities
exchange on which any Class or Classes of the Certificates may be listed or to
conform to any usage in respect thereof, or as may, consistently herewith, be
prescribed by the Certificate Trustee or by the Certificate Issuer (with the
prior written approval of the Note Issuer), and as evidenced by the execution
and authentication of such Certificates.

           Except as provided in Section 2.12, the definitive Certificates of
each Class shall be printed, lithographed or engraved or produced by any
combination of these methods or may be produced in any other manner permitted by
the rules of any securities exchange on which the Certificates of such Class may
be listed, as evidenced by an order by an Authorized Representative of the
Certificate Issuer, relating to the authentication of such Certificates by the
Certificate Trustee.

           The Certificates of each Class shall be issued in not less than
Minimum Denominations.

           The Certificates shall be executed on behalf of the Certificate
Issuer by the Delaware Trustee by manual or facsimile signature of a Responsible
Officer of the Delaware Trustee. Certificates bearing the manual or facsimile
signature of an individual who was, at the time when such signature was affixed,
authorized to sign on behalf of the Certificate Issuer shall be validly issued
by the Certificate Issuer, notwithstanding that such individual has ceased to be
so authorized prior to the authentication and delivery of such Certificates or
did not hold such office at the date of such Certificates. No Certificate shall
be entitled to any benefit under this Certificate Indenture, or be valid for any
purpose, unless there appears on such Certificate a certificate of
authentication substantially in the form set forth in EXHIBIT A-1 OR A-2 hereto

                                      -20-
<PAGE>

(as applicable) executed by the Certificate Trustee (or any Authentication
Agent) by manual signature, and such certificate of authentication upon any
Certificate shall be conclusive evidence, and the only evidence, that such
Certificate has been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication.

           Section 2.04. AUTHENTICATION OF CERTIFICATES. The Certificate Trustee
shall duly authenticate and deliver Certificates of each Class in authorized
denominations equaling, in the aggregate for each Class of Certificates, the
aggregate initial principal amount of the Notes of such Class.

           Section 2.05. TEMPORARY CERTIFICATES. Pending the preparation of
definitive Certificates of any Class, the Delaware Trustee on behalf of the
Certificate Issuer may execute, and the Certificate Trustee or any
Authentication Agent upon written order of the Certificate Issuer shall
authenticate and deliver, temporary Certificates of such Class that are printed,
lithographed, typewritten or otherwise produced, in any denomination, containing
substantially the same terms and provisions as set forth in EXHIBIT A, except
for such appropriate insertions, omissions, substitutions and other variations
relating to their temporary nature as the Certificate Issuer may determine, as
evidenced by the execution of such temporary Certificates by the Delaware
Trustee on behalf of the Certificate Issuer.

           If temporary Certificates of any Class are issued, the Certificate
Issuer will cause definitive Certificates of such Class to be prepared without
unreasonable delay. After the preparation of definitive Certificates of such
Class, the temporary Certificates shall be exchangeable for definitive
Certificates of such Class upon surrender of the temporary Certificates at the
Corporate Trust Office of the Certificate Trustee, or at the office or agency of
the Certificate Trustee maintained in accordance with Section 6.11, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Certificates, the Delaware Trustee on behalf of the Certificate Issuer
shall execute and the Certificate Trustee shall authenticate and deliver in
exchange therefor definitive Certificates (of the same Class as the temporary
Certificates surrendered) of authorized denominations of a like aggregate
Original Principal Amount. Until so exchanged, such temporary Certificates shall
in all respects be entitled to the same benefits under this Certificate
Indenture as definitive Certificates of the same Class.

           Section 2.06. REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.
The Certificate Trustee shall cause to be kept at the office of agency to be
maintained by it in accordance with the provisions of Section 6.11 a register
(the "Certificate Register") in which, subject to such reasonable regulations as
it may prescribe, the Certificate Trustee shall provide for the registration of
Certificates and of transfers and exchanges of Certificates as herein provided.
The Certificate Trustee shall initially be the registrar (the "Certificate
Registrar") for the purpose of registering Certificates and transfers and
exchanges of Certificates as herein provided.

           Subject to this Section 2.06, upon surrender for registration of
transfer of any Certificate at the Corporate Trust Office or such other office
or agency maintained by the Certificate Trustee in accordance with Section 6.11,
the Delaware Trustee on behalf of the Certificate Issuer shall execute, and the
Certificate Trustee shall authenticate and deliver, in the name of the
designated transferee, one or more new Certificates (of the same Class as the
Certificates surrendered for registration of transfer) in authorized
denominations of a like aggregate Original Principal Amount; provided, however,
that if any such surrendered Certificate shall have become or within 15 days

                                      -21-
<PAGE>

shall be due and payable or shall have been called for redemption, instead of
issuing a replacement Certificate, the Certificate Trustee may pay such
surrendered Certificate when so due and payable or upon the Special Distribution
Date without surrender thereof.

           At the option of a Certificateholder, Certificates may be exchanged
for other Certificates (of the same Class as the Certificates surrendered for
registration of exchange) of authorized denominations of a like aggregate
Original Principal Amount, upon surrender of the Certificates to be exchanged at
any such office or agency. Whenever any Certificates are so surrendered for
exchange, the Delaware Trustee on behalf of the Certificate Issuer shall
execute, and the Certificate Trustee shall authenticate and deliver the
Certificates that the Certificateholder making the exchange is entitled to
receive.

           Every Certificate presented or surrendered for registration of
transfer or exchange shall be duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Certificate Trustee and the
Certificate Registrar duly executed by the Certificateholder thereof or its
attorney duly authorized in writing.

           No service charge shall be made to a Certificateholder for any
registration of transfer or exchange of Certificates, but the Certificate
Trustee shall require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.

           All Certificates surrendered for registration of transfer or exchange
shall be cancelled and subsequently destroyed by the Certificate Trustee in
accordance with its customary practices.

           Section 2.07. CERTIFICATEHOLDERS' LISTS AND REPORTS BY CERTIFICATE
TRUSTEE.

           (a) THE CERTIFICATE ISSUER TO FURNISH CERTIFICATE TRUSTEE WITH NAMES
AND ADDRESSES OF CERTIFICATEHOLDERS. The Certificate Registrar on behalf of the
Certificate Issuer will furnish or cause to be furnished to the Certificate
Trustee within 15 days after each Record Date, and at such other times as the
Certificate Trustee may request in writing, within 30 days after receipt by the
Certificate Issuer of any such request, a list, in such form as the Certificate
Trustee may reasonably require, of all information in the possession or control
of the Certificate Issuer as to the names and addresses of the
Certificateholders, in each case as of a date not more than 15 days prior to the
time such list is furnished; provided, however, that so long as the Certificate
Trustee is the sole Certificate Registrar, no such list need be furnished; and
provided further, however, that no such list need be furnished for so long as a
copy of the Certificate Register is being furnished to the Certificate Trustee
pursuant to Section 6.11.

           Upon the written request of any Certificateholder or
Certificateholders of record holding Certificates evidencing not less than ten
percent of the aggregate Outstanding Amount of Certificates, the Certificate
Trustee shall afford such Certificateholder or Certificateholders access during
business hours to the current list of Certificateholders for purposes of
communicating with other Certificateholders with respect to their rights under
this Certificate Indenture.

                                      -22-
<PAGE>

           (b) PRESERVATION OF INFORMATION. The Certificate Trustee shall
preserve, in as current a form as is reasonably practicable, the names and
addresses of Certificateholders contained in the most recent list furnished to
the Certificate Trustee as provided in Section 6.11 or Section 2.07(a), as the
case may be, and the names and addresses of Certificateholders received by the
Certificate Trustee in its capacity as Certificate Registrar, if so acting. The
Certificate Trustee may destroy any list furnished to it as provided in Section
6.11 or Section 2.07(a), as the case may be, upon receipt of a new list so
furnished.

           (c) COMMUNICATIONS AMONG CERTIFICATEHOLDERS. Certificateholders may
communicate pursuant to Section 312(b) of the Trust Indenture Act with other
Certificateholders with respect to their rights under this Certificate Indenture
or under the Certificates.

           (d) REPORTS BY CERTIFICATE TRUSTEE. To the extent that any of the
events described in Section 313(a) of the Trust Indenture Act shall have
occurred, within 60 days after December 31 of each year, commencing with the
year 2001, the Certificate Trustee shall transmit to the Certificateholders, as
provided in Section 313(c) of the Trust Indenture Act, a brief report dated as
of such December 31, if required by Section 313(a) of the Trust Indenture Act.
The Certificate Trustee also shall comply with Section 313(b) of the Trust
Indenture Act.

           A copy of each report at the time of its mailing to
Certificateholders shall be filed by the Certificate Trustee with the Commission
and with each stock exchange, if any, on which the Certificates are listed and
of which listing the Certificate Trustee has been informed. The Certificate
Issuer shall notify the Certificate Trustee if and when the Certificates are
listed on any stock exchange.

           (e) REPORTS BY THE CERTIFICATE ISSUER. Pursuant to Section 314(a)(4)
of the Trust Indenture Act, the Certificate Issuer shall furnish to the
Certificate Trustee, not less often than annually and prior to January 31 of
each year, commencing January 31, 2002, a certificate prepared by the Delaware
Trustee on behalf of the Certificate Issuer as to the Certificate Issuer's
compliance with all conditions and covenants under this Certificate Indenture.
For purposes of this Section 2.07(e), such compliance shall be determined
without regard to any period of grace or requirement of notice provided under
this Certificate Indenture. In addition, the Certificate Trustee shall forward
such Certificate to the Certificateholders.

           (f) PROTECTIONS. The Certificate Issuer, the Certificate Trustee and
the Certificate Registrar shall have the protection of Section 312(c) of the
Trust Indenture Act.

           Section 2.08. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. If
(a) any mutilated Certificate is surrendered to the Certificate Registrar, or
the Certificate Registrar receives evidence to its satisfaction of the
destruction, loss or theft of any Certificate, and (b) there is delivered to the
Certificate Registrar and the Certificate Trustee such security, indemnity or
bond as may be required by them to save each of them harmless, then, in the
absence of notice to the Certificate Registrar or the Certificate Trustee that
such Certificate has been acquired by a bona fide purchaser, the Delaware
Trustee, on behalf of the Certificate Issuer shall execute, and the Certificate
Trustee shall authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate (of the same
Class as the Certificate so mutilated, destroyed, lost or stolen) of like

                                      -23-
<PAGE>

Original Principal Amount. In connection with the issuance of any new
Certificate under this Section 2.08, the Certificate Trustee shall require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses (including the fees
and expenses of the Certificate Trustee and the Certificate Registrar) connected
therewith. Any duplicate Certificate issued pursuant to this Section 2.08 shall
constitute conclusive evidence of the same interest in the Certificate Issuer,
as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.

           Every replacement Certificate issued pursuant to this Section in
replacement of any mutilated, destroyed, lost or stolen Certificate shall
constitute an original additional contractual obligation of the Certificate
Issuer, whether or not the mutilated, destroyed, lost or stolen Certificate
shall be at any time enforceable by anyone, and shall be entitled to all the
benefits of this Certificate Indenture equally and proportionately with any and
all other Certificates duly issued hereunder.

           Section 2.09. PERSONS DEEMED OWNERS. Prior to due presentation of a
Certificate for registration of transfer, the Certificate Trustee, the Delaware
Trustee, the Certificate Registrar and any Paying Agent of the Certificate
Trustee may treat the Person in whose name any Certificate is registered as the
owner of such Certificate for the purpose of receiving distributions pursuant to
Section 4.02 and for all other purposes whatsoever, and none of the Certificate
Trustee, the Delaware Trustee, the Certificate Registrar or any Paying Agent of
the Certificate Trustee shall be affected by any notice to the contrary.

           Section 2.10. CANCELLATION. All Certificates surrendered for payment
or transfer or exchange shall, if surrendered to any party hereto other than the
Certificate Registrar, be delivered to the Certificate Registrar for
cancellation. No Certificates shall be authenticated in lieu of or in exchange
for any Certificates cancelled as provided in this Section, except as expressly
permitted by this Certificate Indenture. All cancelled Certificates held by the
Certificate Registrar shall be delivered to the Certificate Trustee and, in
accordance with Section 2.06, destroyed.

           Section 2.11. LIMITATION OF LIABILITY FOR PAYMENTS. All payments or
distributions made to Holders of Certificates under this Certificate Indenture
shall be made only from the Trust Property with respect to that Class of
Certificates and only to the extent that the Certificate Trustee shall have
sufficient income or proceeds from such Trust Property to make such payments in
accordance with the terms of Article IV of this Certificate Indenture. Each
Holder of a Certificate of any Class, by its acceptance of a Certificate of that
Class, agrees that it will look solely to the income and proceeds from the Trust
Property with respect to that Class to the extent available for distribution to
the Holder thereof as provided in this Certificate Indenture. It is expressly
understood and agreed by the parties hereto that (a) the Certificates are
executed, authenticated and delivered by the Delaware Trustee and the
Certificate Trustee, respectively, not individually or personally but solely in
their respective capacity as Delaware Trustee and Certificate Trustee in the
exercise of the powers and authority conferred and vested in them, and (b) under
no circumstances shall the Delaware Trustee or Certificate Trustee be personally
liable for the payment of any of the Certificates or any indebtedness or
expenses of the Trust or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Certificate
Issuer under this Certificate Indenture.

                                      -24-
<PAGE>

           Section 2.12. BOOK-ENTRY AND DEFINITIVE CERTIFICATES.

           (a) The Certificates of any Class may be issued in the form of one or
more typewritten certificates representing the Book-Entry Certificates of that
Class, to be delivered to The Depository Trust Company, the initial Clearing
Agency, by, or on behalf of, the Certificate Issuer. In such case, the
Certificates of such Class delivered to The Depository Trust Company shall
initially be registered on the Certificate Register in the name of Cede & Co.,
the nominee of the initial Clearing Agency, and no Certificate Owner will
receive a definitive Certificate representing such Certificate Owner's interest
in the Certificate of such Class, except as provided in Section 2.12(c) below.
Unless and until definitive, fully registered Certificates ("Definitive
Certificates") of such Class have been issued pursuant to Section 2.12(c) below:

                (i) the provisions of this Section 2.12 shall be in full force
           and effect with respect to the Certificates of such Class;

                (ii) the Certificate Issuer, the Paying Agent, the Certificate
           Registrar, the Delaware Trustee and the Certificate Trustee may deal
           with the Clearing Agency for all purposes (including the making of
           distributions on the Certificates of such Class) as the authorized
           representative of the Certificate Owners of Certificates of such
           Class;

                (iii) to the extent that the provisions of this Section 2.12
           conflict with any other provisions of this Certificate Indenture, the
           provisions of this Section 2.12 shall control;

                (iv) the rights of Certificate Owners of Certificates of such
           Class shall be exercised only through the Clearing Agency and shall
           be limited to those established by law and agreements between such
           Certificate Owners and the Clearing Agency Participants; and until
           Definitive Certificates of such Class are issued pursuant to Section
           2.12(c) below, the Clearing Agency will make book-entry transfers
           among the Clearing Agency Participants and receive and transmit
           distributions of principal of and interest on the Certificates of
           such Class to such Clearing Agency Participants; and

                (v) whenever this Certificate Indenture requires or permits
           actions to be taken based upon instructions or directions of
           Certificateholders holding Certificates of such Class representing a
           specified percentage of the aggregate Outstanding Amount of
           Certificates of such Class, the Clearing Agency shall be deemed to
           represent such percentage only to the extent that it has received
           instructions to such effect from Certificate Owners or Clearing
           Agency Participants owning or representing, respectively,
           Certificates representing such percentage of the aggregate
           Outstanding Amount of Certificates of such Class, and has delivered
           such instructions to the Certificate Trustee; the Certificate Trustee
           shall have no obligation to determine whether the Clearing Agency has
           in fact received any such instructions.

           (b) Whenever notice or other communication to the Holders of
Certificates of any Class issued in the form of Certificates representing
Book-Entry Certificates is required under this Certificate Indenture, unless and
until Definitive Certificates of such Class shall have been issued pursuant to
Section 2.12(c), the Certificate Trustee shall give all such notices and

                                      -25-
<PAGE>

communications specified herein to be given to Holders of Certificates of such
Class to the Clearing Agency.

           (c) If (i) the Clearing Agency advises the Certificate Trustee in
writing that the Clearing Agency is no longer willing or able to properly
discharge its responsibilities with respect to the Certificates of a Class, and
the Certificate Trustee or the Certificate Issuer is unable to locate a
qualified successor, (ii) the Certificate Issuer (with the prior written
approval of the Note Issuer) at its option advises the Certificate Trustee in
writing that it elects to terminate the book-entry system through the Clearing
Agency with respect to the Certificates of such Class or (iii) after the
occurrence of a Note Event of Default with respect to any Class of Certificates,
Certificate Owners representing beneficial interests aggregating at least a
majority of the Outstanding Amount of the Certificates advise the Clearing
Agency and the Certificate Trustee in writing that the continuation of a
book-entry system through the Clearing Agency is no longer in the best interests
of the Certificate Owners, then the Clearing Agency shall notify all Certificate
Owners and the Certificate Trustee of the occurrence of any such event and of
the availability of Definitive Certificates to Certificate Owners requesting the
same. Upon surrender to the Certificate Trustee of the typewritten certificate
or certificates representing the Book-Entry Certificates by the Clearing Agency,
accompanied by registration instructions, and upon written direction by the
Certificate Issuer, the Delaware Trustee shall execute on behalf of the
Certificate Issuer and the Certificate Trustee shall authenticate the Definitive
Certificates in accordance with the instructions of the Clearing Agency. None of
the Certificate Issuer, the Certificate Registrar, the Delaware Trustee or the
Certificate Trustee shall be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be fully protected in
relying on, such instructions. Upon the issuance of Definitive Certificates, the
Certificate Trustee and the Delaware Trustee shall recognize the Holders of the
Definitive Certificates as Certificateholders.

Section 2.13.        TAX TREATMENT.

           (a) It is the intention of the parties hereto that the Certificate
Issuer shall be treated as a "grantor trust" for federal income tax purposes and
all transactions contemplated by this Certificate Indenture will be reported
consistent with such treatment.

           (b) The provisions of this Certificate Indenture shall be construed,
and the affairs of the Certificate Indenture shall be conducted, so as to
achieve treatment of the Certificate Indenture as a "grantor trust" for federal
income tax purposes.

                                   ARTICLE III

                                    COVENANTS

           Section 3.01. COMPLIANCE WITH DECLARATION OF TRUST. The Certificate
Issuer covenants and agrees to operate in strict conformity with the Declaration
of Trust, the terms of which are incorporated herein by reference, and shall not
amend the Declaration of Trust except as expressly permitted thereunder or in
any manner that would adversely affect the interests of the Certificateholders.

                                      -26-
<PAGE>

           This Certificate Indenture and the Declaration of Trust shall,
together, constitute the governing instrument of the Trust. To the extent that
the provisions of this Certificate Indenture and the Declaration of Trust
conflict with respect to the issuance of the Certificates and the rights of the
holders thereof, this Certificate Indenture shall control.

           Section 3.02. NO ADDITIONAL CERTIFICATES. The Certificate Issuer
shall not issue any additional Certificates hereunder, except pursuant to
Section 2.06 and Section 2.08.

           Section 3.03. SWAP AGREEMENTS.

           (a) Replacement of Swap Counterparty.

                (i) Upon a termination event or event of default under any Class
           A-4 Swap Agreement, the Certificate Issuer shall appoint a recognized
           swap dealer that is a member of the International Swaps and
           Derivatives Association, Inc., with capital and surplus of at least
           $50 million (the "Swap Agent"), to independently solicit, for a
           period not exceeding 30 days, a replacement Class A-4 Swap
           Counterparty (a "Replacement Counterparty"), who shall not be the
           Swap Agent or an Affiliate thereof. During such 30-day period, the
           Swap Agent shall be required to identify a Qualified Replacement
           Counterparty, or if a Qualified Replacement Counterparty cannot be
           found, the Swap Agent shall be required to identify the highest rated
           Replacement Counterparty available that is approved by the Holders of
           at least 66 2/3% of the Outstanding Amount of the Class A-4
           Certificates (an "Approved Replacement Counterparty"). In any case,
           if there is more than one available Qualified Replacement
           Counterparty or Approved Replacement Counterparty, as applicable,
           with the same credit rating, the Swap Agent shall select that
           prospective Qualified Replacement Counterparty or Approved
           Replacement Counterparty, as applicable, offering the terms with the
           lowest all-in cost to the Certificate Issuer.

                (ii) If the Swap Agent is successful in identifying a Qualified
           Replacement Counterparty or Approved Replacement Counterparty, upon
           the termination of the Class A-4 Swap Agreement, the Certificate
           Issuer shall execute a replacement Class A-4 Swap Agreement with such
           Replacement Counterparty having substantially the same terms as the
           Class A-4 Swap Agreement being replaced, effective as of the
           Distribution Date immediately succeeding such execution. Any amounts
           paid by such Replacement Counterparty in connection with its entering
           into such replacement Class A-4 Swap Agreement shall be paid to the
           terminated Class A-4 Swap Counterparty (to the extent of any
           termination payment paid to the Certificate Issuer by the Replacement
           Swap Counterparty).

                (iii) If a Qualified Replacement Counterparty or an Approved
           Replacement Counterparty has not been obtained, the Swap Agent shall
           be required to renew such search every three months thereafter until
           a Qualified Replacement Counterparty or Approved Replacement
           Counterparty has been identified and approved and a replacement Class
           A-4 Swap Agreement has been entered into in the manner set forth in
           clauses (i) and (ii) above.

                                      -27-
<PAGE>

                     Upon termination or assignment of any Swap Counterparty's
           rights and powers, pursuant to any Swap Agreement, the Certificate
           Trustee shall promptly inform the Certificate Issuer, the Holders of
           the related Class and the Rating Agencies of such termination or
           assignment. As soon as a replacement Swap Counterparty is appointed,
           the Certificate Issuer shall notify the Certificate Trustee, the
           Holders of the related Class and the Rating Agencies of such
           appointment, specifying in such notice the name and address of such
           replacement Swap Counterparty.

           (b)        Termination Events:  Events of Default.

                (i) If a termination event or an event of default occurs and is
           continuing under any Class A-4 Swap Agreement, the Certificate
           Trustee may, and at the direction of the Holders of at least 66 2/3%
           of the Outstanding Amount of the Class A-4 Certificates shall,
           exercise all rights, remedies, powers, privileges and claims of the
           Certificate Issuer against the Class A-4 Swap Counterparty, including
           the right or power to take any action to compel or secure performance
           or observance by any Swap Counterparty of its obligations to the
           Certificate Issuer thereunder and to give any consent, request,
           notice, direction, approval, extension or waiver under any Swap
           Agreement, and any right of the Certificate Issuer to take such
           action shall be suspended.

                (ii) Upon a swap counterparty downgrade event or payment default
           by the Class A-4 Swap Counterparty under any Class A-4 Swap
           Agreement, the Certificate Issuer shall not consent to any Approved
           Replacement Counterparty that fails to satisfy the Swap Counterparty
           Minimum Ratings, determine to continue with a downgraded Class A-4
           Counterparty notwithstanding the failure timely to identify a
           Qualified or Approved Replacement Counterparty, or waive a payment
           default by the Class A-4 Swap Counterparty within the time periods
           prescribed in the Class A-4 Swap Agreement, except as directed solely
           by the Holders of at least 66 2/3% of the Outstanding Amount of the
           Class A-4 Certificates in their sole discretion.

                (iii) Upon the termination of any Swap Agreement and payment by
           the related Swap Counterparty of any termination payment or other
           similar amount to the Issuer in accordance with the terms of such
           Swap Agreement, such amount shall be deposited directly into the
           Certificate Account for the related Class of floating rate
           Certificates and paid to the Holders of such floating rate Class on
           the next Distribution Date.

           (c)        Amendments to Swap Agreement; Waivers.

                (i) The Class A-4 Swap Agreement may be amended with the consent
           of the Certificate Trustee and the related Class A-4 Swap
           Counterparty, upon satisfaction of the Rating Agency Condition; but
           such amendment may not adversely affect in any material respect the
           interests of the Holders of Class A-4 Certificates unless the Holders
           of at least 66 2/3% of the Outstanding Amount of the Class A-4
           Certificates direct the Certificate Trustee to consent to such
           amendment. Moreover, such amendment may not adversely affect in any
           material respect the interests of the Holders of any other Class of
           Certificates or any counterparty to any other Swap Agreement without
           the consent of the Holders of at least 66 2/3% of the Outstanding
           Amount of all of such other Classes, and

                                      -28-
<PAGE>

           each counterparty to any other Swap Agreement, materially and
           adversely affected thereby. For so long as any of the Certificates
           are listed on the Luxembourg Stock Exchange and the rules of that
           exchange so require, notice of any such amendment will be published
           pursuant to those rules promptly following its effectiveness.

                (ii) Except as provided in any Class A-4 Swap Agreement with
           respect to any swap counterparty downgrade event or payment default
           by a Class A-4 Swap Counterparty, with respect to any action proposed
           by the Certificate Issuer to amend, modify, waive, supplement or
           surrender the terms of the Class A-4 Swap Agreement, or waive timely
           performance or observance by a Class A-4 Swap Counterparty under any
           Class A-4 Swap Agreement, in a way which would materially and
           adversely affect the interests of the Holders of the Class A-4
           Certificates, the Certificate Issuer shall satisfy the Rating Agency
           Condition. Thereafter, the Certificate Issuer will consent to such
           proposed action only with the consent of (i) the Holders of at least
           66 2/3% of the Outstanding Amount of the Class A-4 Certificates and
           (ii) the Holders of at least 66 2/3% of the Outstanding Amount of all
           of such other Classes, and each counterparty to any other Swap
           Agreement, materially and adversely affected thereby. For so long as
           any of the Certificates are listed on the Luxembourg Stock Exchange
           and the rules of that exchange so require, notice of any such
           amendment or waiver will be published pursuant to those rules
           promptly following its effectiveness.

           (d) Allocations of Collateral. Notwithstanding any other provision in
this Certificate Indenture to the contrary, in the event of an acceleration of
the Notes and a subsequent liquidation of the Collateral in accordance with the
Note Indenture, if so provided in any Swap Agreement, the proceeds of such
liquidation allocated to the related Class of floating rate Certificates shall
be allocated between and paid to the Holders of such floating rate Class, on the
one hand, and the related Swap Counterparty, on the other hand, pro rata based
on the aggregate amount of principal and interest due and payable on such
floating rate Class and the aggregate amount payable to the related Swap
Counterparty in accordance with such Swap Agreement.

           Section 3.04. LISTING AGENT, PAYING AGENT, TRANSFER AGENT.

           (a) For so long as any Certificates are listed on the Luxembourg
Stock Exchange and the rules and regulations of such exchange so require, the
Certificate Issuer shall retain a listing agent, a transfer agent and a paying
agent in Luxembourg. The Certificate Issuer shall give Certificate Trustee and
any other agent appointed under this Section 3.04 prompt written notice of the
location and identity, and of any change in the location or identity, of any
such office or agency.

           Section 3.05. SWAP AGREEMENT COVENANTS.

           (a) The Certificate Issuer agrees to take all such lawful actions to
enforce its rights under any Swap Agreement and to compel or secure the
performance and observance by any Swap Counterparty, of each of their
obligations to the Certificate Issuer under or in connection with any Swap
Agreement, in accordance with the terms thereof. So long as no Event of Default
occurs and is continuing, but subject to Section 3.05(f), the Certificate Issuer
may exercise any

                                      -29-
<PAGE>

and all rights, remedies, powers and privileges lawfully available to the
Certificate Issuer under or in connection with any Swap Agreement.

           (b) If the Certificate Issuer or a Swap Counterparty proposes to
amend, modify, waive, supplement, terminate or surrender, or agree to any
amendment, waiver, supplement, termination, or surrender of, the terms of any
Swap Agreement, or waive timely performance or observance thereunder by or any
Swap Counterparty, in such a way as would materially and adversely affect the
interests of the Holders of any Class, the Certificate Issuer shall first notify
the Rating Agencies of the proposed amendment, modification, termination or
surrender. If it receives notification that the Rating Agency Condition has been
satisfied, the Certificate Issuer shall notify the Certificate Trustee, and the
Certificate Trustee shall notify any such Holders and Counterparty, of the
proposal and that the Rating Agency Condition has been satisfied with respect
thereto. With respect to any such proposed action related to any Swap Agreement,
the Certificate Trustee shall consent to such proposed action only (x) with the
consent of the Holders of at least 66 2/3% of the Outstanding Amount of the
Certificates of the related Class, and each counterparty under any other Swap
Agreement, materially and adversely affected thereby and (y) upon satisfaction
of the Rating Agency Condition. If any such amendment, modification, supplement
or waiver shall be so consented to by the Certificate Trustee or such Holders,
the Certificate Issuer agrees to execute and deliver, in its own name and at its
own expense, such agreements, instruments, consents and other documents as shall
be necessary or appropriate in the circumstances.

           (c) Promptly following a default by any Swap Counterparty under any
Swap Agreement, and at the Certificate Issuer's expense, the Certificate Issuer
agrees to take all such lawful actions as the Certificate Trustee may request to
compel or secure the performance and observance by the Swap Counterparty of its
obligations to the Certificate Issuer under or in connection with the Swap
Agreement in accordance with the terms thereof, and to exercise any and all
rights, remedies, powers and privileges lawfully available to the Certificate
Issuer under or in connection with the Swap Agreement, to the extent and in the
manner directed by the Certificate Trustee, including the transmission of
notices of default on the part of the Swap Counterparty thereunder and the
institution of legal or administrative actions or proceedings to compel or
secure performance by the Swap Counterparty of its obligations under the Swap
Agreement.

           (d) Except as provided herein, the Certificate Issuer shall not take
any action to terminate or assign the Swap Counterparty's rights and powers
under any Swap Agreement or replace any Swap Counterparty following an event of
default, termination event or downgrade event under any Swap Agreement without
(i) the prior written consent of the Certificate Trustee and of the Holders of
at least 66 2/3% of the Outstanding Amount of the Certificates of the related
Class, and (ii) satisfying any other requirements set forth in the related Swap
Agreement.

                                      -30-
<PAGE>

                                   ARTICLE IV

                 DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS

           Section 4.01. CERTIFICATE ACCOUNTS.

           (a) The Certificate Trustee shall establish and maintain, for the
Certificate Issuer, on behalf of the Holders of Certificates of each Class one
or more segregated trust accounts with respect to such Class (each, a
"Certificate Account"), which shall be non-interest bearing except as provided
in Section 4.04, in the corporate trust department of an Eligible Institution,
in the name of the Certificate Trustee for the benefit of such
Certificateholders. The Certificate Trustee shall hold each Certificate Account
in trust for the benefit of the Holders of Certificates of the corresponding
Class, and shall make or permit withdrawals therefrom only as provided in this
Certificate Indenture. On each day when a Payment or Special Payment (other than
a Special Payment that represents the proceeds of any sale pursuant to Article V
hereof by the Certificate Trustee of any Note) is made to the Certificate
Trustee, as holder of Notes of any Class, the Certificate Trustee upon receipt
shall immediately deposit the aggregate amount of such Payment or Special
Payment in the Certificate Account for the corresponding Class of Certificates.
The Certificate Trustee shall immediately deposit in the Class A-4 Subaccount
all amounts required to be deposited therein pursuant to Section 2.01. Upon the
sale of any Note by the Certificate Trustee pursuant to Article V and the
realization of any proceeds thereof, the Certificate Trustee shall deposit the
aggregate amount of such proceeds as a Special Payment in the Certificate
Account for the Class of Certificates corresponding to the Class of the Note so
sold.

           (b) The Certificate Trustee shall present to the Note Trustee for
payment each Note on its Final Maturity Date, or, in the case of any redemption
or repayment of such Note in full prior to its Final Maturity Date, on the
applicable Payment Date therefor.

           (c) The Certificate Trustee (or any Paying Agent other than the
Certificate Trustee) shall have sole dominion and exclusive control over all
monies in the Certificate Accounts and shall apply such amounts therein as
provided in this Article.

           Section 4.02. DISTRIBUTIONS FROM CERTIFICATE ACCOUNTS.

           (a) On any Distribution Date, the Certificate Trustee shall
distribute out of the Certificate Account for the corresponding Class of
Certificates, in the manner described in Section 4.02(e), the entire amount of
such Payment deposited therein pursuant to Section 4.01(a); provided, however,
that in the event receipt of any such Payment is not confirmed by the
Certificate Trustee by 1:00 p.m. (New York City time) on such Distribution Date,
distribution thereof shall be made on the day receipt thereof is confirmed by
the Certificate Trustee by 1:00 p.m. (New York City time) or, if receipt thereof
is confirmed by the Certificate Trustee after 1:00 p.m. (New York City time), on
the following Business Day. On any Distribution Date, the Certificate Trustee
shall distribute out of the Class A-4 Subccount, in the manner described in
Section 4.02(e), the amount required to be distributed therefrom pursuant to
Section 2.01. There shall be so distributed to each Holder of such Class of
Certificates on the Record Date with respect to such Distribution Date (other
than as provided in Section 9.01 with respect to a final distribution) such
Certificateholder's fractional undivided share (based on the aggregate

                                      -31-
<PAGE>

Outstanding Amount of Certificates of such Class held by such Certificateholder)
of the aggregate amount in the related Certificate Account. The foregoing
notwithstanding, if a Payment is not received by the Certificate Trustee by the
day that is five days after the related Payment Date, but is subsequently
received, it will be treated as a Special Payment pursuant to Section 4.02(b).

           The final distribution with respect to any Certificate, however, will
be made only upon presentation and surrender of such Certificate at the office
or agency of the Certificate Trustee specified in the notice given by the
Certificate Trustee with respect to such final payment. The Certificate Trustee
will provide notice of a final distribution to each Holder as of the date such
notice is given with respect to any Certificate as soon as practicable following
receipt of notice from the Note Trustee of a final payment on a corresponding
Note.

           (b) On each Special Distribution Date with respect to the
distribution of any Special Payment with respect to any Class of Notes, the
Certificate Trustee shall distribute out of the Certificate Account for the
corresponding Class of Certificates, in the manner described in Section 4.02(e),
the entire amount of such Special Payment deposited therein pursuant to Section
4.01(a) and any income and earnings received from the investment of such Special
Payment pursuant to Section 4.04; provided, however, that in the event receipt
of any such Special Payment is not confirmed by the Certificate Trustee by 1:00
p.m. (New York City time) on such Special Distribution Date, distribution
thereof shall be made on the day receipt thereof is confirmed by the Certificate
Trustee by 1:00 p.m. (New York City time) or, if receipt thereof is confirmed by
the Certificate Trustee after 1:00 p.m. (New York City time), on the following
Business Day. There shall be so distributed to each Holder of such Class of
Certificates on the Special Record Date with respect to such Special
Distribution Date (other than as provided in Section 9.01 with respect to a
final distribution) such Certificateholder's fractional undivided share (based
on the aggregate Outstanding Amount of Certificates of such Class held by such
Certificateholder) of the aggregate amount of such Special Payment and any
income and earnings received from the investment of such Special Payment
pursuant to Section 4.04.

           (c) Subject to the allocation of money in any Certificate Account for
any floating rate Class pursuant to Section 2.01, the Certificate Trustee shall
allocate amounts distributed to Holders of Certificates of any Class on any
Distribution Date or Special Distribution Date as follows: (i) to the extent
such amounts represent payments of principal of the corresponding Class of Notes
(including prepayments or redemption price), or the proceeds of the sale of any
such Note by the Certificate Trustee pursuant to Article V (to the extent such
proceeds exceed the unpaid interest on the related class of Notes), such amounts
shall be allocated to principal of such Certificates and (ii) all other such
amounts shall be allocated to interest on such Certificates. The Certificate
Trustee may conclusively rely on the payment statement received by it from the
Servicer pursuant to the Servicing Agreement with any payment in respect of any
Class of Notes as to whether the amount so paid in respect of such Notes is in
respect of principal of or interest on such Notes. If no statement is received,
such payments received with respect to any Class of Notes shall first be
allocable to interest to the extent of any interest accrued and payable on such
Class of Notes, and then to principal.

           (d) The Certificate Trustee shall cause notice of each Special
Payment with respect to any Class of Notes to be mailed to each Holder of

                                      -32-
<PAGE>

Certificates of the corresponding Class at its address as it appears in the
Certificate Register. In the event of (i) the optional redemption of the Notes
of any Class, such notice shall be mailed not less than five days nor more than
25 days prior to the Special Distribution Date on which any such Redemption
Payment is scheduled to be distributed, and (ii) the mandatory redemption of the
Notes of any Class, such notice shall be mailed not less than five days prior to
the Special Distribution Date on which any such Redemption Payment is scheduled
to be distributed. In the case of any other Special Payment, such notice shall
be mailed not less than 20 days prior to the Special Distribution Date on which
any Special Payment is scheduled to be distributed in respect of Certificates of
such Class stating such anticipated Special Distribution Date. Any such notice
mailed by the Certificate Trustee shall set forth:

              (i) the Special Distribution Date or the Distribution Date, as
         applicable, and the Special Record Date or Record Date therefor, as
         applicable (except as otherwise provided in Section 9.01);

              (ii) the amount of the Special Distribution for each $1,000
         Original Principal Amount of Certificates of the applicable Class and
         the amount thereof constituting principal and interest;

              (iii) the reason for the Special Distribution; and

              (iv) the total amount to be received on such date for each $1,000
         Original Principal Amount of Certificates of the applicable Class but
         only, in the case of a Special Payment, if the related Special
         Distribution Date is also a Distribution Date.

           (e) Distributions to Holders of Certificates shall be by check sent
by first-class mail to the address of such Holder appearing on the Certificate
Register at the relevant Record Date or Special Record Date or, upon written
application of a Holder of Certificates of any Class in the Original Principal
Amount of $1,000,000 or more to the Certificate Trustee made at any time not
later than such Record Date or Special Record Date or continuing in effect from
a prior request, by wire transfer in immediately available funds to the account
of such Holder at such bank located in New York, New York having wire transfer
capability as may be designated by such Holder; provided, however, that the
final distribution in respect of any Certificate shall be made only as provided
in Section 9.01. The foregoing notwithstanding, any distributions made to Cede &
Co., as the nominee of the initial Clearing Agency, shall be made by wire
transfer of immediately available funds.

           Section 4.03. STATEMENTS TO CERTIFICATEHOLDERS.

           (a) On each Distribution Date, Special Distribution Date or any other
date specified herein for distribution of any payments with respect to any Class
of Certificates, or as soon as practicable following such Distribution Date,
Special Distribution Date or other date (unless the Certificate Trustee is the
Note Trustee and the statement required below is provided by the Note Trustee no
later than two Business Days prior to such distribution), the Certificate
Trustee will send, with respect to each distribution, to Holders of Certificates
of such Class a statement with respect to such distribution to be made on such
Distribution Date, Special Distribution Date or other date, as the case may be,
setting forth the following information:

                                      -33-
<PAGE>

                (i) the amount of such distribution to Holders of Certificates
           allocable to (A) principal and (B) interest, in each case per $1,000
           Original Principal Amount of each Class of Certificates;

                (ii) the aggregate outstanding principal balance of the
           Certificates, after giving effect to payments allocated to principal
           reported under (i) above; and

                (iii) the difference, if any, between the amount specified in
           (ii) above and the principal amount scheduled to be outstanding on
           such date according to the Expected Amortization Schedule.

In providing the foregoing statement, the Certificate Trustee may rely upon the
statements provided by the Note Trustee pursuant to Section 6.06 of the Note
Indenture. On each date on which the Certificate Trustee distributes any such
report to the Holders of the Certificates of any Class, the Certificate Trustee
shall also distribute such report to each Rating Agency.

           (b) Within a reasonable period of time after the end of each calendar
year but not later than the latest date permitted by law, the Certificate
Trustee shall furnish to each Person who at any time during such calendar year
was a Holder of any Class of Certificates and received a distribution thereon, a
statement containing the sum of the amounts determined pursuant to clause (a)(i)
above with respect to such Class of Certificates for such calendar year, or, in
the event such Person was a Holder of such Class of Certificates during a
portion of such calendar year, for the applicable portion of such year, and such
other items as are readily available to the Certificate Trustee and that a
Certificateholder shall reasonably request as necessary for the purpose of such
Certificateholder's preparation of its federal income tax returns. If any
Certificates are listed on the Luxembourg Stock Exchange, and the rules of that
exchange so require, notice that this statement is available with the listing
agent in Luxembourg shall be given to holders of those listed Certificates by
publication in a daily newspaper in Luxembourg.

           Section 4.04. INVESTMENT OF SPECIAL PAYMENT MONEYS. Any money
received by the Certificate Trustee pursuant to Section 4.01(a) representing a
Special Payment that is not to be promptly distributed, to the extent
practicable, shall be invested in Eligible Investments at the written direction
of the Servicer by the Certificate Trustee pending distribution of such Special
Payment pursuant to Section 4.02. Any investment made pursuant to this Section
4.04 shall be in such Eligible Investments maturing in not more than 60 days or
such lesser time as is required for the distribution of any such funds on a
Special Distribution Date pending the distribution of such funds to
Certificateholders as described herein. The Certificate Trustee shall hold any
such Eligible Investments until maturity. Such Eligible Investments (i) shall
not mature later than the Business Day immediately preceding the Special
Distribution Date relating to such invested funds, (ii) (A) if such Eligible
Investments have a maturity of one month or less, such Eligible Investments (or
the provider thereof) must have a long term unsecured debt rating of at least A2
by Moody's or a certificate of deposit rating of at least P-1 by Moody's, and
(B) if such Eligible Investments have a maturity of greater than one month, such
Eligible Investments (or the provider thereof) must have a long term unsecured
debt rating of at least Aaa by Moody's and a certificate of deposit rating of at
least P-1 by Moody's. The Certificate Trustee shall have no liability with
respect to any investment made pursuant to this Section 4.04 (including any

                                      -34-
<PAGE>

losses on such investments), other than by reason of the willful misconduct or
gross negligence of the Certificate Trustee. All income and earnings from such
investments shall be distributed, if and as received, on such Special
Distribution Date as part of such Special Payment and shall be treated as
payments of interest on the Certificates.

           If the rating of the Eligible Institution, which may be the Note
Trustee's Corporate Trust Office, fall below the rating requirements set forth
in clause (b)(i) of the definition of Eligible Institution, the Delaware
Trustee, on behalf of the Certificate Issuer, shall, within one month after
notice of such rating change, cause the Collection Account to be transferred to
an institution meeting the requirements set forth in clause (b)(i) of the
definition of Eligible Institution.

           Section 4.05. REDUCTION IN PRINCIPAL. Any reduction in the principal
amount of any Certificate effected by any distribution in respect of principal
thereof shall be binding upon all Holders of such Certificate and of any
Certificate issued upon the registration or transfer thereof or in lieu thereof,
whether or not noted thereon.

                                   ARTICLE V

                                    DEFAULTS

           Section 5.01. EVENTS OF DEFAULT.

           (a) If any Event of Default, other than a breach of the State Pledge
by the State of Connecticut under the Statute and Section 10.01 hereunder, shall
occur and be continuing, then, and in each and every case, the Certificate
Trustee may, and, upon the written direction of Holders representing not less
than a majority of the Outstanding Amount of the Certificates then Outstanding,
shall vote all the Notes in favor of declaring the unpaid principal amount of
all the Notes then outstanding and accrued interest thereon to be due and
payable in accordance with the provisions thereof. In addition, if a Note Event
of Default shall have occurred and be continuing, the Certificate Trustee may,
and, upon the written direction of Holders representing not less than a majority
of the Outstanding Amount of the Certificates then Outstanding, shall vote all
the Notes in favor of directing the Note Trustee as to the time, method and
place of conducting any proceeding for any remedy available to the Note Trustee,
including the sale of any or all of the Notes, without recourse to or warranty
by the Certificate Trustee or any Certificateholder, to any person or entity, or
of exercising any trust or power conferred on the Note Trustee under the Note
Indenture.

           (b) In addition, after a Note Event of Default shall have occurred
and be continuing, subject to Section 5.01(c), the Certificate Trustee may, and
upon the written direction of Holders of Certificates representing not less than
a majority of the Outstanding Amount of Certificates, by such officer or agent
as it may appoint, shall sell, convey, transfer and deliver any Note or Notes,
without recourse to or warranty by the Certificate Trustee or any
Certificateholder, to any Person, all upon such terms and conditions as the
Certificateholders may reasonably deem advisable and at such prices as the
Certificateholders may reasonably deem advisable, for cash. If the Certificate
Trustee so decides or is required to sell or otherwise dispose of the Notes
pursuant to this Section, the Certificate Trustee may, but is not obligated to,
take such of the actions described above as it may reasonably deem most
effectual to complete the sale or other disposition of the Notes, so as to

                                      -35-
<PAGE>

provide for the payment in full of all amounts due on the Certificates.

           (c) The foregoing provisions of Section 5.01(b) notwithstanding, the
Certificate Trustee shall not sell any Notes following the occurrence of any
Event of Default, other than a Note Event of Default described in Section
5.01(a), (b) or (c) of the Note Indenture, unless (i) the Certificate Trustee
determines that the amounts receivable from the Collateral are not sufficient to
pay in full the principal of and accrued interest on the Notes and all amounts
payable pursuant to clauses (i) through (iv) of Section 8.02(d) of the Note
Indenture and the Certificate Trustee obtains the written consent of Holders of
Certificates of each Class representing 66 2/3 percent of the aggregate
Outstanding Amount of the Certificates, or (ii) the Certificate Trustee obtains
the written consent of Holders of Certificates representing 100 percent of the
aggregate Outstanding Amount of the Certificates.

           Section 5.02. INCIDENTS OF SALE OF NOTES. Upon any sale of the Notes
made either under the power of sale given under this Certificate Indenture or
otherwise for the enforcement of this Certificate Indenture, the following shall
be applicable:

           (a) CERTIFICATEHOLDERS AND CERTIFICATE TRUSTEE MAY PURCHASE NOTES.
Any Certificateholder, the Certificate Trustee in its individual or any other
capacity or any other Person (other than the Seller) may bid for and purchase
any of the Notes, and upon compliance with the terms of sale, may hold, retain,
possess and dispose of such Notes in their own absolute right without further
accountability.

           (b) RECEIPT OF CERTIFICATE TRUSTEE SHALL DISCHARGE PURCHASER. The
receipt of the Certificate Trustee, on behalf of the Certificate Issuer, shall
be a sufficient discharge to any purchaser for its purchase money, and, after
paying such purchase money and receiving such receipt, such purchaser or its
personal representative or assigns shall not be obliged to see to the
application of such purchase money, or be in any way answerable for any loss,
misapplication or nonapplication thereof.

           (c) APPLICATION OF MONEYS RECEIVED UPON SALE. Any moneys collected by
the Certificate Issuer or the Certificate Trustee upon any sale made either
under the power of sale given by this Certificate Indenture or otherwise for the
enforcement of this Certificate Indenture, shall be applied as provided in
Section 4.02.

           Section 5.03. JUDICIAL PROCEEDINGS INSTITUTED BY CERTIFICATE TRUSTEE;
CERTIFICATE TRUSTEE MAY BRING SUIT.

           (a) If there shall be a failure to make payment of the principal of
or interest on any Note, then the Certificate Trustee in its own name, and as
trustee of an express trust, as holder of such Note, if directed in writing by
the Holders of a majority of the Outstanding Amount of the Certificates but
subject to the provisions of Article VI, shall, to the extent permitted by and
in accordance with the terms of the Notes, be entitled and empowered to
institute any suits, actions or proceedings at law, in equity or otherwise,
including the power to make a demand on the Note Trustee to take action under
the Note Indenture to enforce the Notes, for the collection of

                                      -36-
<PAGE>

the sums so due and unpaid on the Note and may prosecute any such claim or
proceeding to judgment or final decree with respect to the whole amount of any
such sums so due and unpaid.

           (b) If there shall be a breach of the State Pledge by the State of
Connecticut, then the Certificate Trustee, in its own name and as trustee of an
express trust, as holder of the Notes, shall be, to the extent permitted by
state and federal law, entitled and empowered to institute any suits, actions or
proceedings at law, in equity or otherwise, to enforce the State Pledge and to
collect any monetary damages as a result of a breach thereof, and may prosecute
any such suit, action or proceeding to judgment or final decree.

           Section 5.04. CONTROL BY CERTIFICATEHOLDERS. The Holders of a
majority of the Outstanding Amount of the Certificates (or, if less than all
Classes are affected, the affected Class or Classes) shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Certificate Trustee, or exercising any trust or power conferred
on the Certificate Trustee under this Certificate Indenture, including any right
of the Certificate Trustee as holder of the Notes of the corresponding Class or
Classes, in each case unless a different percentage is specified herein;
provided, however, that:

           (a) such direction shall not be in conflict with any rule of law or
with this Certificate Indenture and would not involve the Certificate Trustee in
personal liability or expense;

           (b) the Certificate Trustee shall not determine that the action so
directed would be unjustly prejudicial to the Holders of Certificates of such
Class or Classes not taking part in such direction;

           (c) the Certificate Trustee may take any other action deemed proper
by the Certificate Trustee that is not inconsistent with such direction; and

           (d) if a Note Event of Default with respect to such Class of Notes
shall have occurred and be continuing, such direction shall not obligate the
Certificate Trustee to vote more than a corresponding majority of the related
Notes held by the Certificate Issuer in favor of declaring the unpaid principal
amount of the Notes and accrued interest thereon to be due and payable or
directing any action by the Note Trustee with respect to such Note Event of
Default.

           Section 5.05. WAIVER OF PAST DEFAULTS. Prior to the declaration of
the acceleration of the maturity of the Notes as provided in Section 5.01, the
Holders of Certificates of not less than a majority of the Outstanding Amount of
the Certificates may in writing direct the Certificate Trustee to waive any past
default or Note Event of Default and its consequences except a default (a) in
payment of principal of or interest on any of the Notes, (b) in respect of a
covenant or provision under the Note Indenture that cannot be modified or
amended without the consent of the Holder of each Note or all Classes of Notes
affected or (c) in the deposit or distribution of any Payment or Special Payment
under Section 4.01 or in the distribution of any payment under Section 4.02,
which defaults may be waived by the Certificate Trustee only upon the written
direction of the Holders of each Certificate, or each affected Class, as the
case may be. Upon any such direction, the Certificate Trustee shall vote such

                                      -37-
<PAGE>

percentage of the Notes of the corresponding Class held by the Certificate
Trustee as corresponds to the percentage of the aggregate Outstanding Amount of
the Certificates of such Class held by Holders who directed the Certificate
Trustee to waive such default or Note Event of Default hereunder.

           Upon any waiver that is effective under the terms of the Note
Indenture to waive such Note Event of Default, such Note Event of Default shall
cease to exist with respect to this Certificate Indenture, and, in the case of a
default, any Note Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Certificate Indenture and any written
direction given by the Certificate Trustee on behalf of such Certificateholders
to the Note Trustee or in respect of any Notes shall be annulled with respect
thereto; but no such waiver shall extend to any subsequent or other default or
Note Event of Default or impair any right consequent thereon.

           Section 5.06. RIGHT OF CERTIFICATEHOLDERS TO RECEIVE PAYMENTS NOT TO
BE IMPAIRED. Anything in this Certificate Indenture to the contrary
notwithstanding, including Section 5.07 hereof, the right of any
Certificateholder to receive distributions of payments required pursuant to
Section 4.02 hereof on the Certificates when due, or to institute suit for the
enforcement of any such payment on or after the applicable Distribution Date,
Special Distribution Date or other date specified herein for the making of such
payment, shall not be impaired or affected without the consent of such
Certificateholder.

           Section 5.07. CERTIFICATEHOLDERS MAY NOT BRING SUIT EXCEPT UNDER
CERTAIN CONDITIONS. A Certificateholder shall not have the right to institute
any suit, action or proceeding at law or in equity or otherwise with respect to
this Certificate Indenture, for the appointment of a receiver or for the
enforcement of any other remedy under this Certificate Indenture, unless:

           (a) such Certificateholder has previously given written notice to the
Certificate Trustee of a continuing Note Event of Default with respect to the
Class of Certificates held by such Holder;

           (b) the Holders of not less than 25 percent of the Outstanding Amount
of the Certificates have made written request to the Certificate Trustee to
institute such action, suit or proceeding in respect of such Note Event of
Default in its own name as Certificate Trustee hereunder;

           (c) such Certificateholder or Certificateholders have offered to the
Certificate Trustee indemnity satisfactory to it against the costs, expenses
(including legal fees and expenses) and liabilities to be incurred in complying
with such request;

           (d) the Certificate Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to institute such action, suit
or proceedings; and

           (e) no direction inconsistent with such written request has been
given to the Certificate Trustee during such 60-day period by the Holders of a
majority of the Outstanding Amount of the Certificates;

it being understood and intended that no one or more Holders of Certificates
shall have any right in any manner whatever by virtue of, or by availing of, any
provision of this Certificate Indenture to affect, disturb or prejudice the
rights of any other Holders of Certificates or to obtain or to seek to obtain

                                      -38-
<PAGE>

priority or preference over any other Certificateholders or to enforce any right
under this Certificate Indenture, except in the manner herein provided. The
provisions of this Section 5.07 shall be deemed to modify, to the fullest extent
permitted by law, the rights of the Certificateholders under Section 3816 of the
Business Trust Statute.

           In the event the Certificate Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of
Certificates, each representing less than a majority of the Outstanding Amount
of the Certificates, the Certificate Trustee in its sole discretion may
determine what action, if any, shall be taken, notwithstanding any other
provisions of this Certificate Indenture.

           Section 5.08. REMEDIES CUMULATIVE. No remedy given hereunder to the
Certificate Trustee or to any of the Certificateholders shall be exclusive of
any other remedy or remedies, and every such remedy shall be cumulative and in
addition to every other remedy given hereunder or now or hereafter given by
statute, law, equity or otherwise.

                                   ARTICLE VI

                             THE CERTIFICATE TRUSTEE

           Section 6.01. NOTICE OF DEFAULTS. As promptly as practicable after,
and in any event within 30 days after, receipt by a Responsible Officer of the
Certificate Trustee of written notice or actual knowledge of the occurrence of
any default (as such term is defined below) hereunder, the Certificate Trustee
shall transmit by mail to the Certificate Issuer, the Note Trustee and the
Holders of Certificates in accordance with Section 313(c) of the Trust Indenture
Act, notice of such default, unless such default shall have been cured or
waived. For the purpose of this Section, the term "default" means any event that
is, or after notice or lapse of time or both would become, a Note Event of
Default with respect to such Class of Certificates.

           Section 6.02. CERTAIN RIGHTS OF CERTIFICATE TRUSTEE. Subject to the
provisions of Section 315 of the Trust Indenture Act:

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

           (b) any request or direction of the Certificate Issuer mentioned
herein shall be sufficiently evidenced by a Request, accompanied by evidence
reasonably satisfactory to the Certificate Trustee that the Note Issuer has
given its prior written approval of such request or direction;

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

                                      -39-
<PAGE>

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

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

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

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

           (h) the Certificate 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 Certificates relating to the time, method and place
of conducting any proceeding for any remedy available to the Certificate
Trustee, or exercising any trust or power conferred upon the Certificate
Trustee, under this Certificate Indenture;

           (i) the Certificate Trustee shall not be required to expend or risk
its own funds in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or indemnity satisfactory to it against
such risk is not reasonably assured to it;

           (j) the Certificate Trustee shall not be personally liable for any
action taken or suffered or omitted to be taken by it in good faith and
reasonably believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Certificate Indenture; provided, however, that
the Certificate Trustee's conduct does not constitute willful misconduct, gross
negligence or bad faith;

           (k) in the event that the Certificate Trustee is also acting as
Paying Agent, Authenticating Agent or Certificate Registrar hereunder, the
rights and protections afforded to the Certificate Trustee pursuant to this
Article VI shall also be afforded to such Paying Agent, Authenticating Agent or
Certificate Registrar;

           (l) the Certificate Trustee shall not be charged with knowledge of an
Event of Default unless a Responsible Officer obtains actual knowledge of such
event or the Certificate Trustee receives written notice of such event from the
Certificate Issuer, the Note Trustee, the Servicer or a majority of the Holders
of Certificates of the Class or Classes so affected; and

                                      -40-
<PAGE>

           (m) without limiting its rights under bankruptcy law, when the
Certificate Trustee incurs expenses or renders services in connection with the
insolvency or bankruptcy of any party hereto or with the Basic Documents to
which it is a party, such expenses (including the fees and expenses of its
counsel) and the compensation for such services are intended to constitute
expenses of administration under any bankruptcy or insolvency law.

           Section 6.03. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF
CERTIFICATES. The recitals contained herein and in the Certificates, except the
execution thereof and the certificates of authentication, shall not be taken as
the statements of the Certificate Trustee, and the Certificate Trustee assumes
no responsibility for their correctness. Except as set forth in Section 6.14,
the Certificate Trustee makes no representations as to the validity or
sufficiency of this Certificate Indenture, the Notes, any Basic Document or the
Certificates.

           Section 6.04. MAY HOLD CERTIFICATES. The Certificate Trustee, any
Paying Agent, any Certificate Registrar or any of their Affiliates or any other
agent, in their respective individual or any other capacity, may become the
owner or pledgee of Certificates and, subject to Sections 310(b) and 311 of the
Trust Indenture Act, may otherwise deal with the Certificate Issuer, the Note
Issuer or the Note Trustee with the same rights it would have if it were not
Certificate Trustee, Paying Agent, Certificate Registrar or such other agent.

           Section 6.05. MONEY HELD IN TRUST. Money held by the Certificate
Trustee or the Paying Agent in trust hereunder need not be segregated from other
funds except to the extent required herein or by law and neither the Certificate
Trustee nor the Paying Agent shall have any liability for interest upon any such
moneys except as provided for herein.

           Section 6.06. COMPENSATION AND REIMBURSEMENT; INDEMNIFICATION.

           (a) Pursuant to the Fee and Indemnity Agreement, the Note Issuer has
agreed to pay, or cause to be paid, to the Certificate Trustee from time to time
reasonable compensation for its services and to reimburse it for its reasonable
expenses.

           (b) Pursuant to the Fee and Indemnity Agreement, the Note Issuer
shall indemnify, defend and hold harmless the Certificate Trustee and any of the
affiliates, officials, officers, directors, employees, consultants, counsel and
agents of the Certificate Trustee (the "Certificate Trustee Indemnified
Persons") from and against any and all losses, claims, actions, suits, taxes,
damages, expenses and liabilities (including liabilities under state or federal
securities laws) of any kind and nature whatsoever (collectively, "Certificate
Trustee Expenses"), to the extent that such Certificate Trustee Expenses arise
out of or are imposed upon or asserted against such Certificate Trustee
Indemnified Persons with respect to the creation, operation or termination of
the Certificate Issuer, the execution, delivery or performance of the
Declaration of Trust or this Certificate Indenture, as the case may be, or the
transactions contemplated hereby, the failure of the Note Issuer or any other
Person (other than the Person being indemnified) to perform its obligations
under the Fee and Indemnity Agreement or under any of the Basic Documents, or
otherwise in connection with the Basic Documents or the transactions
contemplated thereby; provided, however, that the Note Issuer shall not be
required to indemnify any Certificate Trustee Indemnified Person for any
Certificate Trustee Expenses that result from the willful misconduct or gross
negligence of such Certificate Trustee Indemnified Person and provided, further,

                                      -41-
<PAGE>

that any Certificate Trustee Expenses payable to any Certificate Trustee
Indemnified Person hereunder shall be paid to the Note Trustee for deposit into
and distribution from the Collection Account in accordance with Article VIII of
the Note Indenture (except to the extent that the Fee and Indemnity Agreement
requires payment to be made directly to such Indemnified Person and payment is
or has been so made). The Note Issuer shall not be required to indemnify any
Certificate Trustee Indemnified Person for any amount paid or payable by such
Certificate Trustee Indemnified Person pursuant to this Section 6.06(b) in the
settlement of any action, proceeding or investigation without the written
consent of the Note Issuer, which consent shall not be unreasonably withheld.
Promptly after receipt by a Certificate Trustee Indemnified Person of notice of
its involvement in any action, proceeding or investigation, such Certificate
Trustee Indemnified Person shall, if a claim for indemnification in respect
thereof is to be made against the Note Issuer under this Section 6.06(b), notify
the Note Issuer in writing of such involvement. Failure by a Certificate Trustee
Indemnified Person to so notify the Note Issuer shall relieve the Note Issuer
from the obligation to indemnify and hold harmless such Certificate Trustee
Indemnified Person under this Section 6.06(b) only to the extent that the Note
Issuer suffers actual prejudice as a result of such failure. With respect to any
action, proceeding or investigation brought by a third party for which
indemnification may be sought under this Section 6.06(b), the Note Issuer shall
be entitled to assume the defense of any such action, proceeding or
investigation. Upon assumption by the Note Issuer of the defense of any such
action, proceeding or investigation, the Certificate Trustee Indemnified Person
shall have the right to participate in such action or proceeding and to retain
its own counsel. The Note Issuer shall be entitled to appoint counsel of the
Note Issuer's choice at the Note Issuer's expense to represent the Certificate
Trustee Indemnified Person in any action, proceeding or investigation for which
a claim of indemnification is made against the Note Issuer under this Section
6.06(b) (in which case the Note Issuer shall not thereafter be responsible for
the fees and expenses of any separate counsel retained by the Certificate
Trustee Indemnified Person except as set forth below); provided, however, that
such counsel shall be reasonably satisfactory to the Certificate Trustee
Indemnified Person. Notwithstanding the Note Issuer's election to appoint
counsel to represent the Certificate Trustee Indemnified Person in an action,
proceeding or investigation, the Certificate Trustee Indemnified Person shall
have the right to employ separate counsel (including local counsel), and the
Note Issuer shall bear the reasonable fees, costs and expenses of such separate
counsel if (i) the use of counsel chosen by the Note Issuer to represent the
Certificate Trustee Indemnified Person would present such counsel with a
conflict of interest, (ii) the actual or potential defendants in, or targets of,
any such action include both the Certificate Trustee Indemnified Person and the
Note Issuer and the Certificate Trustee Indemnified Person shall have reasonably
concluded that there may be legal defenses available to it that are different
from or additional to those available to the Note Issuer, (iii) the Note Issuer
shall not have employed counsel reasonably satisfactory to the Certificate
Trustee Indemnified Person to represent the Certificate Trustee Indemnified
Person within a reasonable time after notice of the institution of such action
or (iv) the Note Issuer shall authorize the Certificate Trustee Indemnified
Person to employ separate counsel at the expense of the Note Issuer.
Notwithstanding the foregoing, the Note Issuer shall not be obligated to pay for
the fees, costs and expenses of more than one separate counsel for the
Certificate Trustee Indemnified Persons (in addition to local counsel). The Note
Issuer will not, without the prior written consent of the Certificate Trustee
Indemnified Person, settle or compromise or consent to the entry of any judgment
with respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification may be sought under this Section 6.06(b)
(whether or not the Certificate Trustee Indemnified Person is an actual or
potential party to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of the Certificate Trustee Indemnified

                                      -42-
<PAGE>

Person from all liability arising out of such claim, action, suit or proceeding.
Indemnification under this Section 6.06(b) shall include reasonable fees and
out-of-pocket expenses of investigation and litigation (including reasonable
attorney's fees and expenses), except as otherwise provided in this Certificate
Indenture. The obligations of the Note Issuer to indemnify the Certificate
Trustee Indemnified Persons shall survive the termination of the Fee and
Indemnity Agreement, this Certificate Indenture and the resignation or removal
of the Certificate Trustee.

           Notwithstanding anything to the contrary in this Certificate
Indenture, the Certificate Trustee shall have no recourse against the
Certificate Issuer or the Notes or payments thereon or proceeds thereof for
payment of any amounts required to be paid to the Certificate Trustee under this
Section 6.06(b).

           Section 6.07. CORPORATE CERTIFICATE TRUSTEE REQUIRED; ELIGIBILITY.

           (a) The Certificate Trustee shall at all times be eligible to act as
a trustee under Section 310(a) of the Trust Indenture Act, shall have a combined
capital and surplus of at least $50,000,000 and shall have a long-term debt
rating of at least A by Moody's and Standard & Poor's. If such entity publishes
reports of conditions at least annually, pursuant to law or to the requirements
of federal, state, territorial or District of Columbia supervising or examining
authority, then for the purposes of this Section 6.07, the combined capital and
surplus of such entity shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published.

           (b) In determining whether the Certificate Trustee has a conflicting
interest under Section 310(b) of the Trust Indenture Act and this Section, each
other Class of Certificates will be treated as having been issued under an
indenture other than this Certificate Indenture.

           (c) If at any time the Certificate Trustee shall cease to be eligible
in accordance with the provisions of this Section 6.07, the Certificate Trustee
shall resign immediately in the manner and with the effect specified in Section
6.08.

           Section 6.08. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.

           (a) No resignation or removal of the Certificate Trustee and no
appointment of a successor Certificate Trustee pursuant to this Article shall
become effective (i) until the acceptance of appointment by the successor
Certificate Trustee under Section 6.09 and (ii) other than in the case of
paragraph (b) below, unless a successor Certificate Trustee has been appointed
and has accepted such appointment and the Note Issuer and the Certificate Issuer
have received written confirmation from each of the Rating Agencies that no
lowering or withdrawal of the then current ratings of any Class of Certificates
will result from such appointment.

           (b) The Certificate Trustee may resign at any time in the case of a
conflicting interest as determined in accordance with Section 6.07(b) by giving
written notice thereof to the Certificate Issuer, the Authorized Agents, the
Note Issuer and the Note Trustee. If an instrument of acceptance by a successor
Certificate Trustee shall not have been delivered to the Certificate Issuer and

                                      -43-
<PAGE>

the Certificate Trustee within 30 days after the giving of such notice of
resignation, the resigning Certificate Trustee may petition any court of
competent jurisdiction for the appointment of a successor Certificate Trustee.

           (c) The Certificate Trustee may be removed at any time in the case of
a conflicting interest as determined in accordance with Section 6.07(b) by Act
of Certificateholders holding Certificates representing not less than 51 percent
of the Outstanding Amount of the Certificates delivered to the Certificate
Trustee and to the Certificate Issuer, the Note Issuer and the Note Trustee.

           (d) Upon 30 days' written notice, the Certificate Trustee (i) may
resign with respect to the Certificates as a whole by giving such written notice
to the Certificate Issuer, the Authorized Agents, the Note Issuer and the Note
Trustee or (ii) may be removed with respect to the Certificates as a whole by
Act of Certificateholders holding Certificates representing not less than a
majority of the Outstanding Amount of Certificates delivered to the Certificate
Issuer, the Note Issuer and the Note Trustee. If an instrument of acceptance by
a successor Certificate Trustee with respect to the Certificates as a whole
shall not have been delivered to the Certificate Issuer, the Note Issuer and the
Note Trustee within 90 days after the giving of such notice of resignation or
Act by the Certificateholders as a whole for removal of the Certificate Trustee,
the Certificate Issuer or the Note Issuer may petition any court of competent
jurisdiction for the appointment of a successor Certificate Trustee with respect
to the Certificates as a whole.

           (e) If at any time:

                (i) the Certificate Trustee shall fail to comply with Section
           310 of the Trust Indenture Act after written request therefor by the
           Certificate Issuer or by the Note Issuer or by any Holder of
           Certificates who has been a bona fide Holder of Certificates for at
           least six months; or

                (ii) the Certificate Trustee shall cease to be eligible under
           Section 6.07 and shall fail to resign after written request therefor
           by the Certificate Issuer or by the Note Issuer or by any
           Certificateholder; or

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

                (iv) the Certificate Trustee shall fail to perform its
           obligations hereunder in any material respect and shall not have
           cured such failure within 30 days after written notice thereof from
           the Certificate Issuer, the Note Trustee or any Certificateholder;

then, in any case, (x) the Certificate Issuer or the Note Issuer may remove the
Certificate Trustee or (y) any Holder of Certificates who has been a bona fide
Holder of Certificates for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the

                                      -44-
<PAGE>

removal of the Certificate Trustee and the appointment of a successor
Certificate Trustee.

           (f) If a Responsible Officer of the Certificate Trustee shall have
received written notice of an Avoidable Tax that has been or is likely to be
asserted, the Certificate Trustee shall promptly notify the Certificate Issuer
and the Note Issuer thereof and shall, within 30 days of such notification,
resign hereunder unless within such 30-day period the Certificate Trustee shall
have received notice that either the Certificate Issuer or the Note Issuer has
agreed to pay such tax. In such event, the Certificate Issuer (with the prior
written approval of the Note Issuer) shall promptly appoint a successor
Certificate Trustee in a jurisdiction where there are no Avoidable Taxes. As
used herein, an "Avoidable Tax" means a state or local tax: (i) upon (w) the
Certificate Issuer, (x) the Trust Property, (y) the Certificateholders or (z)
the Certificate Trustee for which the Certificate Trustee is entitled to seek
reimbursement from the Trust Property, and (ii) that would be avoided if the
Certificate Trustee were located in another state, or jurisdiction within a
state, within the United States. A tax shall not be an Avoidable Tax if either
the Certificate Issuer or the Note Issuer shall agree to pay, and shall pay,
such tax.

           (g) If the Certificate Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of the
Certificate Trustee for any reason, the Certificate Issuer (with the prior
written approval of the Note Issuer and the Finance Authority) shall promptly
appoint a successor Certificate Trustee. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Certificate Trustee shall be appointed by Act of the
Certificateholders representing not less than a majority of the Outstanding
Amount of the Certificates delivered to the Certificate Issuer, the Note Trustee
and the retiring Certificate Trustee, the successor Certificate Trustee so
appointed shall, forthwith upon its acceptance of such appointment, become the
successor Certificate Trustee and supersede the successor Certificate Trustee
appointed as provided above. If no successor Certificate Trustee shall have been
so appointed as provided above and accepted appointment in the manner
hereinafter provided, any Holder of Certificates who has been a bona fide Holder
of Certificates for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Certificate Trustee.

           (h) The successor Certificate Trustee shall give notice of the
resignation and removal of the Certificate Trustee and appointment of the
successor Certificate Trustee by mailing written notice of such event by
first-class mail, postage prepaid, to the Holders as their names and addresses
appear in the Certificate Register and to each Rating Agency, the Note Issuer,
the Certificate Issuer and the Finance Authority. Each notice shall include the
name of such successor Certificate Trustee and the address of the corporate
trust office of such successor Certificate Trustee.

           (i) The Certificate Issuer shall notify the Rating Agencies and the
Finance Authority of any resignation and removal of the Certificate Trustee and
appointment of a successor Certificate Trustee under this Section 6.08.

           Section 6.09. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. Every successor
Certificate Trustee appointed hereunder shall execute, acknowledge and deliver
to the Certificate Issuer and to the retiring Certificate Trustee an instrument

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<PAGE>

accepting such appointment, and thereupon the resignation or removal of the
retiring Certificate Trustee shall become effective and such successor
Certificate Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring
Certificate Trustee; but, on request of the Certificate Issuer or the successor
Certificate Trustee, such retiring Certificate Trustee shall execute and deliver
an instrument transferring to such successor Certificate Trustee all the rights,
powers and trusts of the retiring Certificate Trustee and shall duly assign,
transfer and deliver to such successor Certificate Trustee all property and
money held by such retiring Certificate Trustee hereunder. Upon request of any
such successor Certificate Trustee, the Certificate Issuer, the retiring
Certificate Trustee and such successor Certificate Trustee shall execute and
deliver any and all instruments containing such provisions as shall be necessary
or desirable to transfer and confirm to, and for more fully and certainly
vesting in, such successor Certificate Trustee all such rights, powers and
trusts. No Certificate Trustee hereunder shall be liable for the acts or
omissions of any successor Certificate Trustee.

           No successor Certificate Trustee shall accept its appointment unless
at the time of such acceptance such successor Certificate Trustee shall be
qualified and eligible under this Article and any and all amounts due and
payable to the predecessor Certificate Trustee have been paid.

           Section 6.10. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS. Any corporation into which the Certificate 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 Certificate Trustee
shall be a party, or any corporation succeeding to all or substantially all of
the corporate trust business of the Certificate Trustee, shall be the successor
of the Certificate Trustee hereunder, provided such corporation shall be
otherwise qualified and eligible under this Article, without the execution or
filing of any paper or any further act on the part of any of the parties hereto.
In case any Certificates shall have been authenticated, but not delivered, by
the Certificate Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Certificate Trustee may adopt such
authentication and deliver the Certificates so authenticated with the same
effect as if such successor Certificate Trustee had itself authenticated such
Certificates.

           Section 6.11. MAINTENANCE OF AGENCIES .

           (a) There shall at all times be maintained in the Borough of
Manhattan, The City of New York, an office or agency where Certificates may be
presented or surrendered for registration of transfer or for exchange, and for
payment thereof and where notices and demands to or upon the Certificate Trustee
on behalf of the Certificate Issuer in respect of the Certificates or of this
Certificate Indenture may be served. At no time shall there be any other such
office or agency outside the United States. Such office or agency shall be
initially at First Union Trust Company, National Association, 40 Broad St., 5th
Floor, Suite 550, Attention: Corporate Trust Administration. Written notice of
any change of location thereof shall be given by the Certificate Trustee to the
Certificate Issuer, the Note Trustee, the Note Issuer, the Certificateholders,
the Finance Authority and the Rating Agencies. In the event that no such office
or agency shall be maintained or no such notice of location or of change of
location shall be given, presentations and demands may be made and notices may
be served at the Corporate Trust Office of the Certificate Trustee.

                                      -46-
<PAGE>

           (b) There shall at all times be a Certificate Registrar, an
Authentication Agent and a Paying Agent hereunder. Each such Authorized Agent
shall be a bank or trust company, shall be a entity organized and doing business
under the laws of the United States or any state, with a combined capital and
surplus of at least $50,000,000, shall have a long-term debt rating of at least
A by Moody's and by Standard & Poor's, shall be authorized under such laws to
exercise corporate trust powers and shall be subject to supervision by federal
or state authorities. The Certificate Trustee shall initially be the Paying
Agent, Authentication Agent, and, as provided in Section 2.06, Certificate
Registrar hereunder. Each Certificate Registrar, if other than the Certificate
Trustee, shall furnish to the Certificate Trustee, at stated intervals of not
more than six months, and at such other times as the Certificate Trustee may
request in writing, a copy of the Certificate Register.

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

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

           (e) Pursuant to the Fee and Indemnity Agreement, the Note Issuer has
agreed to pay, or cause to be paid, from time to time to each Authorized Agent
reasonable compensation for its services and to reimburse it for its reasonable
expenses; provided, however, that the Note Issuer shall have given prior consent
to the appointment of such Authorized Agent pursuant to the Fee and Indemnity
Agreement, and no Authorized Agent shall have any recourse against the
Certificate Issuer or the Trust Property for payment of such amounts.

                                      -47-
<PAGE>

           Section 6.12. MONEY FOR CERTIFICATE PAYMENTS TO BE HELD IN TRUST.

           (a) All moneys deposited with any Paying Agent for the purpose of any
payment on Certificates of any Class shall be deposited and held in trust for
the benefit of the Certificateholders of such Class entitled to such payment,
subject to the provisions of this Section. Moneys so deposited and held in trust
shall constitute a separate trust fund for the benefit of the Class of
Certificateholders with respect to which such money was deposited.

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

           (b) The Certificate Trustee will cause each Paying Agent other than
the Certificate Trustee to execute and deliver to the Certificate Trustee an
instrument in which such Paying Agent shall agree with the Certificate Trustee
(and, if the Certificate Trustee acts as Paying Agent, it hereby so agrees),
subject to the provisions of this Section, that such Paying Agent will:

                (i) hold all sums held by it for the payment of amounts due with
           respect to the Certificates in trust for the benefit of the Persons
           entitled thereto until such sums shall be paid to such Persons or
           otherwise disposed of as herein provided and pay such sums to such
           Persons as herein provided;

                (ii) give the Certificate Trustee notice of any default under
           this Certificate Indenture of which it has actual knowledge in the
           making of any payment required to be made by the Certificate Issuer
           (or any other obligor on the Certificates) with respect to the
           Certificates;

                (iii) at any time during the continuance of such default, upon
           the written request of the Certificate Trustee, forthwith pay to the
           Certificate Trustee all sums held by it in trust for the payment of
           the Certificates if at any time it ceases to meet the standards
           required to be met by a Paying Agent at the time of its appointment;
           and

                (iv) comply with all requirements of the Code with respect to
           the withholding from any payments made by it on any Certificates of
           any applicable withholding taxes imposed thereon and with respect to
           any applicable reporting requirements in connection therewith.

           Section 6.13. REGISTRATION OF NOTES AND ELIGIBLE INVESTMENTS IN
CERTIFICATE TRUSTEE'S NAME. The Certificate Trustee agrees that all Notes and
Eligible Investments, if any, shall be issued in the name of the Certificate
Trustee or its nominee, on behalf of the Certificate Issuer, and held by the
Certificate Trustee, or, if not so held, the Certificate Trustee or its nominee,
on behalf of the Certificate Issuer, shall be reflected as the owner of such
Notes or Eligible Investments, as the case may be, in the register of the issuer
of such Notes or Eligible Investments. In no event shall the Certificate Trustee

                                      -48-
<PAGE>

invest in, or hold, Notes or Eligible Investments in a manner that would cause
the Certificate Trustee not to have the ownership interest in such Notes or
Eligible Investments under the applicable provisions of the Uniform Commercial
Code in effect in the location where the Certificate Trustee holds such Notes or
Eligible Investments or other applicable law then in effect.

           Section 6.14. REPRESENTATIONS AND WARRANTIES OF CERTIFICATE TRUSTEE.
The Certificate Trustee hereby represents and warrants that:

           (a) the Certificate Trustee is validly existing as a national banking
association under the federal laws of the United States;

           (b) the Certificate Trustee has full power, authority and legal right
to execute, deliver and perform this Certificate Indenture and the Basic
Documents to which the Certificate Trustee is a party and has taken all
necessary action to authorize the execution, delivery, and performance by it of
this Certificate Indenture and such Basic Documents; and

           (c) when delivered by the Certificate Trustee, the Certificates will
have been duly executed by the Delaware Trustee on behalf of the Certificate
Issuer and duly authenticated by the Certificate Trustee.

           Section 6.15. WITHHOLDING TAXES; INFORMATION REPORTING. The
Certificate Trustee, as trustee for the assets of a grantor trust, shall exclude
and withhold from each distribution of principal and interest and other amounts
due hereunder or under the Certificates any and all withholding taxes applicable
thereto as required by law. The Certificate Trustee agrees that it will act as
such withholding agent and, in connection therewith, whenever any present or
future taxes or similar charges are required to be withheld with respect to any
amounts payable in respect of the Certificates, to withhold such amounts and
timely pay the same to the appropriate authority in the name of and on behalf of
the Certificateholders, that it will file any necessary withholding tax returns
or statements when due, and that, as promptly as possible after the payment
thereof, it will deliver to each Certificateholder appropriate documentation
showing the payment thereof, together with such additional documentary evidence
as such Certificateholders may reasonably request from time to time. The
Certificate Trustee agrees to file any other information reports as it may be
required to file with respect to taxes. For purposes of reporting on Internal
Revenue Service Form 1041 (and any statement attached thereto) or any successor
form thereto, the Certificate Trustee will separately set forth information
reported with respect to each Class of Certificates.

                                  ARTICLE VII

                       SUPPLEMENTAL CERTIFICATE INDENTURES

           Section 7.01. SUPPLEMENTAL CERTIFICATE INDENTURES WITHOUT CONSENT OF
CERTIFICATEHOLDERS. Without the consent of Certificateholders, the Certificate
Issuer (with the prior written approval of the Note Issuer) may, and the
Certificate Trustee (subject to Section 7.03) shall, at any time and from time
to time enter into one or more indentures supplemental hereto, in form
satisfactory to the Certificate Trustee, for any of the following purposes:

                                      -49-
<PAGE>

           (a) to add to the covenants of the Certificate Issuer for the benefit
of the Certificateholders, or to surrender any right or power herein conferred
upon the Certificate Issuer;

           (b) to correct or supplement any provision herein or in any
supplemental certificate indenture that may be defective or inconsistent with
any other provision herein or in any supplemental certificate indenture or to
make any other provisions with respect to matters or questions arising under
this Certificate Indenture; provided, however, that any such action shall not
adversely affect in any material respect the interests of the
Certificateholders;

           (c) to cure any ambiguity or correct any mistake;

           (d) to qualify, if necessary, this Certificate Indenture (including
any supplemental certificate indenture) under the Trust Indenture Act, or under
any similar federal statute hereafter enacted, and to add to this Certificate
Indenture such other provisions as may be expressly permitted by the Trust
Indenture Act, excluding, however, the provisions referred to in Section
316(a)(2) of the Trust Indenture Act as in effect at the date as of which this
instrument was executed or any corresponding provision in any similar federal
statute hereafter enacted;

           (e) to provide for any interest rate swap transactions with respect
to any floating rate series or Class of Certificates or any series or Class with
specified credit enhancement; but:

                (i) such action shall not, as evidenced by an opinion of
           counsel, adversely affect in any material respect the interests of
           any Certificateholder or other swap counterparty; and

                (ii) the Rating Agency Condition shall have been satisfied; or

           (f) to authorize the appointment of any listing agent, transfer agent
or Paying Agent or Certificate Registrar for any Class of Certificates required
or advisable in connection with the listing of any Class of Certificates on the
Luxembourg Stock Exchange or any other stock exchange, and otherwise to amend
the Certificate Indenture to incorporate any changes requested or required by
any governmental authority, stock exchange authority, listing agent, transfer
agent or Paying Agent or Certificate Registrar for any Class of Certificates in
connection with that listing.

           Section 7.02. SUPPLEMENTAL CERTIFICATE INDENTURES WITH CONSENT OF
CERTIFICATEHOLDERS. With the consent of the Certificateholders holding
Certificates representing not less than a majority of the aggregate Outstanding
Amount of Certificates of each Class affected thereby, by Act of said
Certificateholders delivered to the Certificate Issuer, the Note Trustee and the
Certificate Trustee, the Certificate Issuer (with the prior written approval of
the Note Issuer) may, and the Certificate Trustee (subject to Section 7.03)
shall, 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 Certificate Indenture or of modifying in any manner the
rights and obligations of the Holders of Certificates of each such Class under
this Certificate Indenture; provided, however, that no such supplemental
indenture shall, without the consent of the Certificateholder of each
Outstanding Certificate affected thereby:

                                      -50-
<PAGE>

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

           (b) permit the disposition of any Note in the Trust Property except
as permitted by this Certificate Indenture, or otherwise deprive any Holder of
Certificates of any Class of the benefit of the ownership of the Notes of the
corresponding Class in the Trust;

           (c) reduce the percentage of the aggregate Outstanding Amount of the
Certificates of any Class that is required for any such supplemental indenture,
or reduce such percentage required for any waiver or consent (of compliance with
certain provisions of this Certificate Indenture or certain defaults hereunder
and their consequences) provided for in this Certificate Indenture;

           (d) modify any of the provisions of this Section, except to increase
any percentage set forth herein or to provide that certain other provisions of
this Certificate Indenture cannot be modified or waived without the consent of
the Holder of each Certificate affected thereby; or

           (e) adversely affect the status of the Trust as a grantor trust for
federal income tax purposes.

           It shall not be necessary for any Act of Certificateholders under
this Section to approve the particular form of any proposed supplemental
certificate indenture, but it shall be sufficient if such Act shall approve the
substance thereof. The Certificate Issuer shall give each Rating Agency five
Business Days prior written notice of any such proposed supplemental certificate
indenture. Promptly after the execution by the Certificate Issuer and the
Certificate Trustee of any supplemental certificate indenture pursuant to this
Section, the Certificate Trustee shall mail to the Holders of the Certificates
to which such supplemental certificate indenture relates a notice setting forth
in general terms the substance of such supplemental certificate indenture. Any
failure of the Certificate Trustee to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such
supplemental certificate indenture.

           Section 7.03. DOCUMENTS AFFECTING IMMUNITY OR INDEMNITY. If in the
opinion of the Certificate Trustee any document required to be executed by it
pursuant to the terms of Section 7.01 or 7.02 adversely affects any interest,
right, duty, immunity or indemnity in favor of the Certificate Trustee under
this Certificate Indenture, the Certificate Trustee may in its discretion
decline to execute such document.

           Section 7.04. EXECUTION OF SUPPLEMENTAL CERTIFICATE INDENTURES;
NOTIFICATION UNDER RULES OF LUXEMBOURG STOCK EXCHANGE. In executing, or
accepting the additional trusts created by, any supplemental certificate
indenture permitted by this Article or the modifications thereby of the trusts
created by this Certificate Indenture, the Certificate Trustee shall be entitled
to receive, and shall be fully protected in relying upon, an Opinion of Counsel
stating that the execution of such supplemental certificate indenture is

                                      -51-
<PAGE>

authorized or permitted by this Certificate Indenture. For so long as any of the
Certificates are listed on the Luxembourg Stock Exchange and the rules of that
exchange so require, notice of such proposed action will be published pursuant
to those rules promptly following its effectiveness.

           Section 7.05. EFFECT OF SUPPLEMENTAL CERTIFICATE INDENTURES. Upon the
execution of any supplemental certificate indenture under this Article, this
Certificate Indenture shall be modified in accordance therewith, and such
supplemental certificate indenture shall form a part of this Certificate
Indenture for all purposes; and every Holder of any Certificate theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby.

           Section 7.06. CONFORMITY WITH TRUST INDENTURE ACT. Every supplemental
certificate indenture executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act as then in effect.

           Section 7.07. REFERENCE IN CERTIFICATES TO SUPPLEMENTAL CERTIFICATE
INDENTURES. Certificates authenticated and delivered after the execution of any
supplemental certificate indenture pursuant to this Article may bear a notation
in form approved by the Certificate Trustee as to any matter provided for in
such supplemental certificate indenture; and, in such case, suitable notation
may be made upon Outstanding Certificates after proper presentation and demand.

           Section 7.08. SWAP COUNTERPARTY CONSENT. The Certificate Issuer shall
not execute any supplemental certificate indenture without the consent of any
Swap Counterparty if such indenture supplements would adversely affect the
interests of the Swap Counterparty.

           Section 7.09. DELAWARE TRUSTEE. To the extent that the Delaware
Trustee is required to enter into any supplemental certificate indenture, the
Delaware Trustee shall have the same rights and privileges afforded the
Certificate Trustee.

                                  ARTICLE VIII

               AMENDMENTS AND SUPPLEMENTS TO NOTES, NOTE INDENTURE
                            AND OTHER BASIC DOCUMENTS

           Section 8.01. AMENDMENTS AND SUPPLEMENTS TO NOTES, NOTE INDENTURE AND
OTHER BASIC DOCUMENTS. In the event that the Certificate Issuer or the
Certificate Trustee, as holder of the Notes of each Class in trust for the
benefit of the Holders of Certificates of the corresponding Class, receives a
request for a consent to any amendment, modification, waiver or supplement under
the Notes, the Note Indenture or any other Basic Document (other than this
Certificate Indenture) to which the Certificate Issuer or the Certificate
Trustee is a party and which in any such case requires the consent of the
Noteholders, the Certificate Issuer shall forward such request for consent to
the Certificate Trustee, and the Certificate Trustee shall forthwith send a
notice of such proposed amendment, modification, waiver or supplement, to each
Holder of Certificates of such Class registered on the Certificate Register as
of such date. The Certificate Trustee shall request from such Certificateholders
directions with respect to each such required Noteholder consent as to (a)
whether or not the Certificate Trustee should take or refrain from taking any

                                      -52-
<PAGE>

action that a holder of such Note has the option to direct, (b) whether or not
to give or execute or direct the Certificate Issuer to give or execute any
waivers, consents, amendments, modifications or supplements as a holder of such
Note and (c) how to vote such Note if a vote has been called for with respect
thereto; provided, however, in the case of any change to the terms of, or
modification to, the Notes which requires the consent of the Noteholders, the
Certificateholders may not direct any such action to be taken or direct whether
or not to give or execute any such waiver, consent, amendment, modification or
supplement that is not pursuant to the original terms of the Notes, unless the
Certificate Trustee obtains an Opinion of Counsel at the expense of the
Certificate Issuer of independent tax counsel to the effect that after any such
action, waiver, consent, amendment, modification or supplement the Trust will
continue to be treated as a "grantor trust" for federal income tax purposes.
Provided such a request for Certificateholder direction shall have been made, in
directing any action or casting any vote or giving any consent as the holder of
the Notes, the Certificate Trustee shall vote or consent with respect to such
Notes in the same proportion as the Certificates of the corresponding Class were
actually voted by Acts of the Holders thereof delivered to the Certificate
Trustee prior to two Business Days before the Certificate Trustee takes such
action or casts such vote or gives such consent.

           The Certificate Trustee shall not consent to any amendment,
modification, waiver or supplement to any Basic Document which would in any
manner adversely affect the interests of the Swap Counterparty without its
consent.

           For so long as any of the Certificates are listed on the Luxembourg
Stock Exchange and the rules of that exchange so require, notice of any
amendment to this Certificate Indenture will be published pursuant to those
rules promptly following its effectiveness.

                                   ARTICLE IX

                           SATISFACTION AND DISCHARGE

           Section 9.01. SATISFACTION AND DISCHARGE OF CERTIFICATE INDENTURE.
This Certificate Indenture shall cease to be of further effect with respect to
the Certificates, and the Certificate Trustee, on reasonable demand of and at
the expense of the Certificate Issuer, shall execute proper instruments
acknowledging satisfaction and discharge of this Certificate Indenture with
respect to the Certificates, upon the distribution to all Secured Parties and
the Certificate Trustee of all amounts required to be distributed to them
pursuant to this Certificate Indenture and the disposition of all property held
as part of the Trust Property. The Certificate Issuer shall pay or provide for
the payment of all remaining liabilities of the Certificate Trustee, but solely
from amounts payable by the Note Issuer under the Fee and Indemnity Agreement.

           Notice of any distribution pursuant to the paragraph above shall be
mailed promptly by the Certificate Trustee to Holders of Certificates then
outstanding. Such notice shall specify the Distribution Date or Special
Distribution Date, as the case may be, upon which the Holders of Certificates
may surrender their Certificates to the Certificate Trustee for payment of the
final distribution and cancellation. Such notice shall be mailed (a) if with
respect to a final distribution, as soon as practicable following receipt of
notice from the Note Trustee of a final payment on a corresponding Note, (b) if
with respect to a Special Payment other than a Special Payment constituting a

                                      -53-
<PAGE>

redemption, not earlier than the 60th day and not later than the 20th day next
preceding such final distribution or (c) if with respect to a Special Payment
constituting a redemption of Certificates resulting from a redemption of Notes,
then in accordance with the provisions of the relevant Section of Article IV
hereof. Such notice shall specify (a) the Distribution Date or Special
Distribution Date, as the case may be, upon which the proposed final payment of
the Certificates will be made upon presentation and surrender of such
Certificates at the office or agency of the Certificate Trustee therein
specified, (b) the amount of any such proposed final payment and (c) that the
Record Date otherwise applicable to such Distribution Date or the Special Record
Date otherwise applicable to such Special Distribution Date, as the case may be,
is not applicable, payments being made only upon presentation and surrender of
the Certificates at the office or agency of the Certificate Trustee therein
specified. The Certificate Trustee shall give such notice to the Certificate
Registrar at the time such notice is given to Holders of Certificates. Upon
presentation and surrender of such Certificates, the Certificate Trustee shall
cause to be distributed to the Holders thereof amounts distributable thereon on
such Distribution Date or Special Distribution Date, as the case may be,
pursuant to Section 4.02.

           In the event that all of the Holders of Certificates shall not
surrender their Certificates for cancellation within six months after the date
specified in the above mentioned written notice, the Certificate Trustee shall
give a second written notice to the remaining Holders of such Certificates to
surrender their Certificates for cancellation and receive the final distribution
with respect thereto. In the event that any money held by the Certificate
Trustee for the payment of distributions on the Certificates shall remain
unclaimed for two years (or such lesser time as the Certificate Trustee shall be
satisfied, after 60 days' notice from the Certificate Issuer (with the prior
written approval of the Note Issuer), is one month prior to the escheat period
provided under applicable law) after the final distribution date with respect
thereto, the Certificate Trustee shall pay such money to the Note Trustee for
deposit into the collection account relating to the related Notes or, if such
collection account no longer exists, to the Note Issuer and the Certificate
Trustee or Note Issuer shall give written notice thereof to the Note Trustee,
the Note Issuer and the Certificate Issuer.

                                   ARTICLE X

                            MISCELLANEOUS PROVISIONS

           Section 10.01. STATE PLEDGE; CERTIFICATES AND NOTES NOT OBLIGATIONS
OF THE STATE OF CONNECTICUT, FINANCE AUTHORITY OR SELLER.

           (a) The Certificate Issuer hereby finds and determines, and hereby
represents and warrants, that it constitutes a "financing entity" under Section
16-245e(a) of the Statute, and that the Certificates constitute "rate reduction
bonds" under Section 16-245e(a) of the Statute and that the Holders of the
Certificates are entitled to the rights and benefits thereunder. Pursuant to
Section 16-245j(b) of the Statute, the State of Connecticut pledges and agrees
with the Note Issuer and the Holders of the Certificates (the "State Pledge") as
follows:

               Except as otherwise provided in this subsection, the state
               of Connecticut does hereby pledge and agree with the owners
               of transition property and holders of rate reduction bonds

                                      -54-
<PAGE>

               that the state shall neither limit nor alter the
               competitive transition assessment, transition property,
               financing orders, and all rights thereunder until the
               obligations, together with the interest thereon, are fully
               met and discharged, provided nothing contained in this
               subsection shall preclude the limitation or alteration if
               and when adequate provision shall be made by law for the
               protection of the owners and holders.

           Further, the Certificate Issuer does hereby pledge and agree with the
Note Issuer and the Holders of the Certificates that it will not act in a manner
inconsistent with the State Pledge and will not take any action that would
impair any rights of the Note Issuer or the Holders of the Certificates or the
Notes, the Transition Property or the Certificates. The Certificate Issuer
hereby further agrees to treat the Notes as debt of the Note Issuer, secured by,
among other things, the Transition Property and the equity of the Note Issuer on
deposit in the Capital Subaccount, for all purposes.

           (b) Each Certificate represents a fractional undivided beneficial
interest in a corresponding Class of Notes, a Swap Agreement, if any, and the
proceeds thereof. The Certificates and the Notes shall not be deemed to
constitute a debt or liability of the State of Connecticut, the Finance
Authority, any political subdivision thereof or the Seller or any of its
affiliates, except that the Notes are obligations of CL&P Funding LLC, which is
an affiliate of CL&P. None of the Certificates, the Notes or the underlying
Transition Property will be guaranteed or insured by the State of Connecticut,
the Finance Authority, the Certificate Issuer or any other governmental agency
or instrumentality or by the Seller or its affiliates.

           Neither the full faith and credit nor the taxing power of the State
of Connecticut, the Finance Authority or any other governmental agency or
instrumentality is pledged to the payment of the principal of, or interest on,
the Certificates or the Notes, or to the payments in respect of the Transition
Property, nor are the State of Connecticut, the Finance Authority, the State
Treasurer or any other governmental agency or instrumentality in any manner
obligated to make any appropriation for the payment thereof.

           Section 10.02. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. The death
or incapacity of any Certificateholder shall not operate to terminate this
Certificate Indenture, the Declaration of Trust or the Certificate Issuer, nor
entitle such Certificateholder's legal representatives or heirs to claim an
accounting or to take any action or commence any proceeding in any court for a
partition or winding up of the Certificate Issuer, nor otherwise affect the
rights, obligations, and liabilities of the parties hereto or any of them.

           Section 10.03. NO RECOURSE TO CERTIFICATE ISSUER. Notwithstanding any
provision of this Certificate Indenture or any supplemental certificate
indenture to the contrary, the Secured Parties shall have no recourse against
the Certificate Issuer, the Certificate Trustee, the Delaware Trustee or the
Finance Authority, but shall look only to the Trust Property with respect to any
amounts due to the Holders hereunder and under the Certificates.

           Section 10.04. CERTIFICATES NONASSESSABLE AND FULLY PAID. Pursuant to
Section 3803(a) of the Business Trust Statute, Certificateholders shall be
entitled to the same limitation of personal liability extended to stockholders

                                      -55-
<PAGE>

of private corporations for profit organized under the General Corporation law
of the State of Delaware. Certificateholders shall not be personally liable for
obligations of the Certificate Issuer, the interests in the Certificate Issuer
represented by the Certificates shall be nonassessable for any losses or
expenses of the Certificate Issuer or for any reason whatsoever, and upon
authentication of the Certificates by the Certificate Trustee pursuant to
Section 2.04, the Certificates are and shall be deemed fully paid and
non-assessable. No Certificateholder shall have any right (except as expressly
provided herein) to vote or in any manner otherwise control the operation and
management of the Trust Property, the Certificate Issuer, or the obligations of
the parties hereto, nor shall anything set forth herein, or contained in the
terms of the Certificates, be construed so as to constitute the
Certificateholders from time to time as partners or members of an association.

           Section 10.05. NOTICES.

           (a) Unless otherwise specifically provided herein, all notices,
directions, consents and waivers required under the terms and provisions of this
Certificate Indenture shall be in English and in writing, and any such notice,
direction, consent or waiver may be given by United States mail, courier
service, facsimile transmission or electronic mail (confirmed by telephone,
United States mail or courier service in the case of notice by facsimile
transmission or electronic mail) or any other customary means of communication,
and any such notice, direction, consent or waiver shall be effective when
delivered, or if mailed, three days after deposit in the United States mail with
proper postage for ordinary mail prepaid,

           if to the Finance Authority, to:

                      Office of the State Treasurer
                      55 Elm Street
                      Hartford, Connecticut  06106
                      Attention:  Assistant Treasurer - Debt Management
                      Facsimile: (860) 702-3127
                      Telephone: (860) 702-3034

           if to the Certificate Issuer, to:

                      Connecticut RRB Special Purpose Trust CL&P-1
                      c/o First Union Trust Company, National Association
                      One Rodney Square
                      920 King Street, 1st Floor
                      Wilmington, DE 19801-7475
                      Attention:  Corporate Trust Administration
                      Facsimile: (302) 888-7544
                      Telephone: (302) 888-7500

                     (with copies to the Finance Authority at the
                      addresses listed herein)

                                      -56-
<PAGE>

           if to the Certificate Trustee, the Delaware Trustee or the Note
           Trustee, to:

                      First Union Trust Company, National Association
                      One Rodney Square
                      920 King Street, 1st Floor
                      Wilmington, DE 19801-7475
                      Attention:  Corporate Trust Administration
                      Facsimile: (302) 888-7544
                      Telephone: (302) 888-7500

           if to the Note Issuer, to:

                       CL&P Funding LLC
                       c/o The Connecticut Light and Power Company
                       107 Selden Street
                       Berlin, Connecticut  06037
                       Attention:  Treasurer
                       Facsimile: (860) 665-5457
                       Telephone: (860) 665-3258
                       Email:  shoopra@nu.com

                       with a copy to:
                       The Connecticut Light and Power Company

                       if by U.S. Mail:
                            P.O. Box 270
                            Hartford, CT  06141-0270
                       if by courier:
                            107 Selden Street
                            Berlin, CT  06037

                       Attention:  Treasurer
                       Facsimile: (860) 665-5457
                       Telephone: (860) 665-3258
                       Email:  shoopra@nu.com

           if to the Rating Agencies, to:

                       Standard & Poor's Ratings Services
                       55 Water Street, 40th Floor
                       New York, New York 10041
                       Attention:  Asset Backed Surveillance Department
                       Facsimile: (212) 438-2655
                       Telephone: (212) 438-2000

                       Moody's Investors Service
                       99 Church Street
                       New York, New York 10007
                       Attention:  ABS Monitoring Department
                       Facsimile: (212) 553-0573
                       Telephone: (212) 553-3686

                                      -57-
<PAGE>
                 and

                       Fitch, Inc.
                       One State Street Plaza
                       New York, New York  10004
                       Attention:  ABS Surveillance
                       Facsimile: (212) 635-0476
                       Telephone: (212) 908-0200

           (b) The Certificate Issuer, the Certificate Trustee, the Note Issuer
or the Note Trustee, by notice to the others, may designate additional or
different addresses for subsequent notices or communications.

           (c) Any notice or communication to Certificateholders shall be mailed
by first-class mail to the addresses for each Certificateholder shown on the
Certificate Register kept by the Certificate Registrar. Failure so to mail a
notice or communication or any defect in such notice or communication shall not
affect its sufficiency with respect to other Certificateholders.

           (d) If a notice or communication is mailed in the manner provided
above within the time prescribed, it is conclusively presumed to have been duly
given, whether or not the addressee receives it.

           (e) If the Certificate Issuer mails a notice or communication to the
Certificateholders, it shall mail a copy to the Certificate Trustee, to each
Paying Agent and to the Note Issuer at the same time.

           (f) Notwithstanding the foregoing, all communications or notices to
the Certificate Trustee or the Delaware Trustee shall be deemed to be given only
when received by a Responsible Officer of the Certificate Trustee or the
Delaware Trustee.

           Section 10.06. GOVERNING LAW. THIS CERTIFICATE INDENTURE SHALL BE
GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC LAW OF THE STATE OF
DELAWARE WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAW.

           Section 10.07. SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Certificate Indenture shall
be for any reason whatsoever held invalid, then such covenants, agreements,
provisions or terms shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Certificate Indenture and shall in no
way affect the validity or enforceability of the other provisions of this
Certificate Indenture, or of the Certificates or the rights of the Secured
Parties.

           Section 10.08. CONFLICT WITH TRUST INDENTURE ACT. If any provision
hereof limits, qualifies or conflicts with another provision hereof that is
required to be included in this Certificate Indenture by any of the provisions
of the Trust Indenture Act, such required provision shall control.

                                      -58-
<PAGE>

           The provisions of Sections 310 through 317 of the Trust Indenture Act
that impose duties on any Person (including the provisions automatically deemed
included herein unless expressly excluded by this Certificate Indenture) are a
part of and govern this Certificate Indenture, whether or not physically
contained herein.

           Section 10.09. EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article
and Section headings herein and in the Table of Contents are for convenience
only and shall not affect the construction hereof.

           Section 10.10. SUCCESSORS AND ASSIGNS; DELEGATION.

           (a) All covenants, agreements, representations and warranties in this
Certificate Indenture by the Certificate Trustee and the Certificate Issuer
shall bind and, to the extent permitted hereby, shall inure to the benefit of
and be enforceable by their respective successors and assigns, whether so
expressed or not.

           (b) No party to this Certificate Indenture shall assign or delegate
this Certificate Indenture or all or any part of its rights or obligations
hereunder to any Person without the prior written consent of the other parties.

           Section 10.11. BENEFITS OF CERTIFICATE INDENTURE. Nothing in this
Certificate Indenture or in the Certificates, express or implied, shall give to
any Person, other than the parties hereto and their successors hereunder, the
Certificateholders and, to the extent provided herein, the Note Issuer and the
Swap Counterparties, any benefit or any legal or equitable right, remedy or
claim under this Certificate Indenture.

           Section 10.12. LEGAL HOLIDAYS. In any case where any date for any
distribution in respect of any Certificate shall not be a Business Day, then
payment need not be made on such date, but may be made on the next succeeding
Business Day with the same force and effect as if made on such first date, and
(unless otherwise specified herein) no interest shall accrue during the
intervening period.

           Section 10.13. COUNTERPARTS. For the purpose of facilitating the
execution of this Certificate Indenture and for other purposes, this Certificate
Indenture may be executed simultaneously in any number of counterparts, each of
which counterparts shall be deemed to be an original, and all of which
counterparts shall constitute but one and the same instrument.

           Section 10.14. THE DELAWARE TRUSTEE. In performing its obligations
hereunder, the Delaware Trustee shall be entitled to the protections of the
Declaration of Trust.

           Section 10.15. NONPETITION COVENANTS. Notwithstanding any prior
termination of this Certificate Indenture or the Note Indenture, but subject to
the DPUC's right to order the sequestration and payment of revenues arising with
respect to the Transition Property notwithstanding any bankruptcy,
reorganization or other insolvency proceedings with respect to the debtor,
pledgor or transferor of the Transition Property pursuant to Sections 16-245k(e)
and 16-245k(g) of the Statute, the Certificate Trustee shall not, prior to the
date which is one year and one day after the termination of the Note Indenture
with respect to the Note Issuer, petition or otherwise invoke or cause the Note
Issuer or the Certificate Issuer to invoke the process of any court or

                                      -59-
<PAGE>

governmental authority for the purpose of commencing or sustaining a case
against the Note Issuer or the Certificate Issuer under any federal or state
bankruptcy, insolvency or similar law or appointing a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official of the Note
Issuer or the Certificate Issuer or any substantial part of the property of the
Note Issuer or the Certificate Issuer, or ordering the winding up or liquidation
of the affairs of the Note Issuer or the Certificate Issuer.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                      -60-
<PAGE>

           IN WITNESS WHEREOF, the Certificate Issuer and the Certificate
Trustee have caused this Certificate Indenture to be duly executed by duly
authorized officers or representatives, all as of the day and year first above
written.

                           CONNECTICUT RRB SPECIAL PURPOSE TRUST CL&P-1

                           By: FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION,
                           not in its individual capacity but solely as Delaware
                           Trustee

                           By:__________________________________________________
                                Name:
                                Title:

                           FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, not
                           in its individual capacity but solely as Delaware
                           Trustee,

                           By:__________________________________________________
                                Name:
                                Title:

                           FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION, not
                           in its individual capacity but solely as Certificate
                           Trustee,

                           By:__________________________________________________
                                Name:
                                Title:

                                     -S-1-
<PAGE>

                                    EXHIBIT A

                 FORM OF CLASS A-1, A-2, A-3 OR A-5 CERTIFICATE

REGISTERED

NO. [       ]                                                           $ [    ]

                  CONNECTICUT RRB SPECIAL PURPOSE TRUST CL&P-1

                                   CLASS A-[ ]

                           RATE REDUCTION CERTIFICATE

       INTEREST             SCHEDULED FINAL              FINAL          CUSIP
         RATE              DISTRIBUTION DATE          TERMINATION
                                                         DATE

REGISTERED OWNER:    Cede & Co.

PRINCIPAL AMOUNT:

           UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
           REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW
           YORK CORPORATION ("DTC"), TO THE TRUST OR ITS AGENT FOR
           REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
           CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
           CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
           AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT 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 THE
           REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
           HEREIN.

           This Certificate evidences a fractional undivided beneficial interest
in an Underlying Note (as defined below) of the corresponding class issued by
CL&P Funding LLC, a Delaware limited liability company, and the proceeds
thereof, held by a trust or registered assigns, as more fully described herein.

           This Certificate shall not be deemed to constitute a debt or
liability of the State of Connecticut, acting through the office of the State
Treasurer (as defined in the Certificate Indenture) (the "Finance Authority"),
any other governmental agency or instrumentality or The Connecticut Light and
Power Company, a Connecticut corporation ("CL&P"), or any of its affiliates.
None of the Certificate, the Underlying Note or the underlying Transition

                                     -A1-1-
<PAGE>

Property (as defined in the Certificate Indenture) will be guaranteed or insured
by the State of Connecticut, the Finance Authority, the Trust (as defined below)
or any other governmental agency or instrumentality or by CL&P or its
affiliates.

           Neither the full faith and credit nor the taxing power of the State
of Connecticut, the Finance Authority or any other governmental agency or
instrumentality is pledged to the payment of the principal of, or interest on,
this Certificate or the Underlying Note, or to the payments in respect of the
Transition Property, nor are the State of Connecticut, the Finance Authority,
the State Treasurer or any other governmental agency or instrumentality in any
manner obligated to make any appropriation for the payment thereof.

           To the extent not otherwise defined herein, the capitalized terms
used herein have the meanings assigned to them in the Certificate Indenture.

           THIS CERTIFIES THAT CEDE & CO., as nominee for The Depository Trust
Company, for value received, is the registered owner of a Principal Amount
(stated above) of nonassessable, fully-paid, fractional undivided beneficial
interest in the related Underlying Note and the proceeds thereof held by
Connecticut RRB Special Purpose Trust CL&P-1 (the "Trust") or registered
assigns. The Trust is created pursuant to a Declaration of Trust dated as of
March [__], 2001 by First Union Trust Company, National Association, as Delaware
Trustee (the "Delaware Trustee"), and the Finance Authority, acting as settlor
thereunder pursuant to Connecticut General Statutes Sections 16-245e through and
including 16-245k (the "Statute"). This Certificate is issued under and is
subject to the terms, provisions, and conditions of, a Certificate Indenture
dated as of March [__], 2001 (the "Certificate Indenture"), by and among the
Delaware Trustee, First Union Trust Company, National Association, as
certificate trustee (the "Certificate Trustee"), and the Trust, a summary of
certain of the pertinent provisions of which is set forth below. This
Certificate is one of the duly authorized class of Certificates designated as
"Connecticut RRB Special Purpose Trust CL&P-1 Rate Reduction Certificates, Class
[ ]" (herein called the "Class [ ] Certificates"). The Class [ ] Certificates
are one of a class of Certificates issued under the Certificate Indenture (such
Class [ ] Certificates, together with other Classes of Certificates issued on
the date hereof under the Certificate Indenture being herein called the
"Certificates"). The holder of this Certificate (the "Holder"), by virtue of its
acceptance hereof, assents and agrees to be bound by the terms of the
Certificate Indenture. This Class [ ] Certificate represents a fractional
undivided beneficial interest in the note of the corresponding class (the
"Underlying Note") issued by CL&P Funding LLC, as Note Issuer, together with the
payments on and proceeds of the Underlying Note. The Underlying Note is secured
by a security interest in the property right created under the Statute, pursuant
to the order of the Connecticut Department of Public Utility Control, issued on
November 8, 2000 and supplemented on December 12, 2000 and March 12, 2001 in
DPUC-00-05-01 (the "Financing Order"), representing the irrevocable right of
CL&P or its assignee to receive a certain nonbypassable charge (as adjusted from
time to time) from certain retail customers of CL&P's distribution system,
together with certain related collateral, all as more fully described in the
Note Indenture.

                                     -A1-2-
<PAGE>

           The aggregate principal amount of all Certificates of all Classes
issued under the Certificate Indenture equals the aggregate principal amount of
the Underlying Notes of all Classes, and all such Certificates are and will be
equally secured by the pledge and covenants made therein, except as otherwise
expressly provided or permitted in the Certificate Indenture.

           Subject to and in accordance with the terms of the Certificate
Indenture, there will be distributed on each quarterly [______] [__],[______]
[__], [______] [__] and [__________] [__] of each year or, if any such day is
not a Business Day, the next succeeding Business Day (each, a "Distribution
Date"), commencing on [_________] [__], 2001 to the Person in whose name this
Certificate is registered at the close of business on the last Business Day
immediately preceding the related Distribution Date or, if Definitive
Certificates are issued, the last day of the immediately preceding calendar
month (each, a "Record Date"), such Holder's fractional undivided interest in
the payments made on the Underlying Note due on the related Payment Date, the
receipt of which has been confirmed by the Certificate Trustee. Subject to and
in accordance with the terms of the Certificate Indenture, in the event that a
Special Payment on the Underlying Note is received by the Certificate Trustee,
from funds then available to the Certificate Trustee, there will be distributed
on the applicable Special Distribution Date, to the Person in whose name this
Certificate is registered on the Record Date preceding the Special Distribution
Date, as applicable, such Holder's fractional undivided share of such amount.
The Special Distribution Date will be determined as provided in the Certificate
Indenture. The Certificate Trustee will mail notice of each Special Payment and
the related Special Distribution Date to the Holder as provided in the
Certificate Indenture.

           Distributions on this Certificate will be made as provided in the
Certificate Indenture by the Certificate Trustee by wire transfer or check
mailed to the Holder of record in the Certificate Register without the
presentation or surrender of this Certificate or the making of any notation
hereon, except that with respect to Certificates registered on the Record Date
in the name of the nominee of the Clearing Agency (initially, such nominee to be
Cede & Co.), payments will be made by wire transfer in immediately available
funds to the account designated by such nominee. Except as otherwise provided in
the Certificate Indenture and notwithstanding the above, the final distribution
on this Certificate will be made after due notice by the Certificate Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office of the Paying Agent or the office or agency
maintained for that purpose by the Certificate Trustee in The City of New York.

           Subject to and in accordance with the terms of the Certificate
Indenture, the Trust has represented and warranted under the Certificate
Indenture that the Trust constitutes a "financing entity" under Section
16-245e(a) of the Statute, and that the Certificates constitute "rate reduction
bonds" under Section 16-245e(a) of the Statute and that the Holders are entitled
to the rights and benefits thereunder. Pursuant to Section 16-245j(b) of the
Statute, the State of Connecticut, has pledged and agreed with the Note Issuer
and the Holders (the "State Pledge") as follows:

                                     -A1-3-
<PAGE>

           Except as otherwise provided in this subsection, the
           state of Connecticut does hereby pledge and agree with
           the owners of transition property and holders of rate
           reduction bonds that the state shall neither limit nor
           alter the competitive transition assessment, transition
           property, financing orders, and all rights thereunder
           until the obligations, together with the interest
           thereon, are fully met and discharged, provided nothing
           contained in this subsection shall preclude the
           limitation or alteration if and when adequate provision
           shall be made by law for the protection of the owners
           and holders.

           In addition, the Trust has pledged and agreed with the Note Issuer
and the Holders that it will not act in a manner inconsistent with the State
Pledge and will not take any action that would impair any rights of the Note
Issuer or the Holders in the Notes, the Transition Property or the Certificates.

           Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

           Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Certificate Trustee by manual
signature, this Certificate shall not be entitled to any benefit under the
Certificate Indenture or any other Basic Document or be valid for any purpose.

           THIS CERTIFICATE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE DOMESTIC LAW OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAW.

           Any reduction in the principal amount of any Certificate effected by
any distribution in respect of principal thereof shall be binding upon all
Holders of such Certificate and of any Certificate issued upon the registration
of transfer thereof or in exchange thereof or in lieu thereof, whether or not
noted thereon.

           It is expressly agreed and understood by the parties hereto that (a)
this Certificate is executed by First Union Trust Company, National Association
and authenticated and delivered by First Union Trust Company, National
Association, not individually or personally but solely as Delaware Trustee and
Certificate Trustee, respectively, on behalf of the Trust in the exercise of the
powers and authority conferred and vested in them, (b) the representations,
undertakings and agreements herein made by the Delaware Trustee and Certificate
Trustee on behalf of the Trust are made and intended not as personal
representations, undertakings and agreements of either trustee, but are made and
intended for the purpose of binding only the Trust, (c) nothing herein contained
shall be construed as creating any liability on First Union Trust Company,
National Association, individually or personally, to perform any covenant either
expressed or implied herein, except in their capacity as Delaware Trustee and

                                     -A1-4-
<PAGE>

Certificate Trustee, respectively, all such liability being expressly waived by
all Persons, and (d) under no circumstances shall First Union Trust Company,
National Association be personally liable for the payment of any indebtedness or
expenses of the Trust, or be personally liable for the breach or failure of any
obligation, representation, warranty or covenant made or undertaken by the Trust
under the Certificate Indenture.

                                     -A1-5-
<PAGE>

           IN WITNESS WHEREOF, the Delaware Trustee on behalf of the Trust has
caused this Certificate to be duly executed.

                                     CONNECTICUT RRB SPECIAL PURPOSE TRUST
                                     CL&P-1

                                     By:     FIRST UNION TRUST COMPANY, NATIONAL
                                             ASSOCIATION, not in its individual
                                             capacity but solely as Delaware
                                             Trustee

                                     By:________________________________________
                                          Name:
                                          Title:

                                     -A1-6-
<PAGE>

               CERTIFICATE TRUSTEE'S CERTIFICATE OF AUTHENTICATION

Dated:  [                    ]

           This is one of the Certificates referred to in the within-mentioned
Certificate Indenture.

                                     FIRST UNION TRUST COMPANY, NATIONAL
                                     ASSOCIATION, not in its individual capacity
                                     but solely as Certificate Trustee

                                     By:________________________________________
                                        Name:
                                        Title:

                                     -A1-7-
<PAGE>

                        [FORM OF REVERSE OF CERTIFICATE]

           The Certificates are limited in right of payment, all as more
specifically set forth on the face hereof and in the Certificate Indenture. All
payments or distributions made to Holders under the Certificate Indenture shall
be made only from the Trust Property and only to the extent that the Certificate
Trustee shall have sufficient income or proceeds from the Trust Property to make
such payments in accordance with the terms of the Certificate Indenture. Each
Holder, by its acceptance hereof, agrees that it will look solely to the income
and proceeds from the Trust Property to the extent available for distribution to
such Holder as provided in the Certificate Indenture. This Certificate does not
purport to summarize the Certificate Indenture and reference is made to the
Certificate Indenture for information with respect to the interests, rights,
benefits, obligations, proceeds, and duties evidenced hereby. A copy of the
Certificate Indenture may be examined during normal business hours at the
principal office of the Certificate Trustee, and at such other places, if any,
designated by the Certificate Trustee, by any Holder upon request.

           The Certificate Indenture permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights of the
Holders under the Certificate Indenture at any time by the Trust and the
Certificate Trustee with the consent of the Holders holding Certificates
representing not less than a majority of the aggregate Outstanding Amount of
Certificates of each affected Class issued by the Trust. Any such consent by the
Holder of this Certificate shall be conclusive and binding on such Holder and
upon all future Holders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange hereof or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Certificate
Indenture also permits the amendment thereof, in certain limited circumstances,
without the consent of the Holders of any of the Certificates.

           As provided in the Certificate Indenture and subject to certain
limitations therein set forth, the transfer of this Certificate is registerable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies maintained by the Certificate Trustee in
its capacity as Certificate Registrar, or by any successor Certificate
Registrar, in the Borough of Manhattan, The City of New York, duly endorsed or
accompanied by a written instrument of transfer in form satisfactory to the
Certificate Trustee and the Certificate Registrar duly executed by the Holder
hereof or such Holder's attorney duly authorized in writing, and thereupon one
or more new Certificates of authorized denominations evidencing the same
aggregate fractional undivided beneficial interest in the Underlying Note will
be issued to the designated transferee or transferees.

           The Certificates are issuable only as registered Certificates without
coupons in Minimum Denominations of $1,000 Original Principal Amount and
integral multiples of $1.00 in excess thereof; provided, however, that one
Certificate of each Class may be of a smaller denomination. As provided in the
Certificate Indenture and subject to certain limitations therein set forth,
Certificates are exchangeable for new Certificates of authorized denominations

                                     -A1-8-
<PAGE>

evidencing the same aggregate fractional undivided beneficial interest in the
Underlying Notes, as requested by the Holder surrendering the same.

           The Holder, by purchase of this Certificate, will be deemed to
represent that such purchase will not result in a non-exempt prohibited
transaction under the Internal Revenue Code of 1986, as amended, or the Employee
Retirement Income Security Act of 1974, as amended, and, in each case, the rules
and regulations thereunder.

           The Holder, by purchase of this Certificate, will be deemed to agree
to treat the Underlying Note as debt of the Note Issuer, secured by, among other
things, the Transition Property and other related collateral, for all purposes.

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

           The Certificate Trustee, the Certificate Registrar, and any agent of
the Certificate Trustee or the Certificate Registrar may treat the Person in
whose name this Certificate is registered as the owner hereof for all purposes,
and neither the Certificate Trustee, the Certificate Registrar, nor any such
agent shall be affected by any notice to the contrary.

           The obligations and responsibilities created by the Certificate
Indenture shall terminate with respect to the Certificates upon the distribution
to the Holders of all amounts required to be distributed to them pursuant to the
Certificate Indenture and the disposition of all property held as part of the
Trust Property, except certain indemnity obligations of the Note Issuer to the
Certificate Trustee under the Fee and Indemnity Agreement.

                                     -A1-9-
<PAGE>

                                   ASSIGNMENT

           Social Security or taxpayer I.D. or other identifying number of
assignee: _________________

           FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto

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

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

                         (name and address of assignee)

the within Class A-[ ] Certificate and all rights thereunder, and hereby
irrevocably constitutes and appoints __________________, attorney, to transfer
said Class A-[ ] Certificate on the books kept for registration thereof, with
full power of substitution in the premises.

Dated:  ___________________________       ______________________________________
                                          Signature Guaranteed:

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

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

*     NOTE: The signature to this assignment must correspond with the name of
      the registered owner as it appears on the face of the within Class A-[ ]
      Certificate in every particular, without alteration, enlargement or any
      change whatsoever.

                                    -A1-10-
<PAGE>
                                   EXHIBIT A-2

                          FORM OF CLASS A-4 CERTIFICATE

REGISTERED

NO. [          ]                                                $ [        ]

                  CONNECTICUT RRB SPECIAL PURPOSE TRUST CL&P-1

                                    CLASS A-4

                           RATE REDUCTION CERTIFICATE

                SCHEDULED FINAL              FINAL          CUSIP
               DISTRIBUTION DATE          TERMINATION
                                             DATE

REGISTERED OWNER:____Cede & Co.

PRINCIPAL AMOUNT:

           UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
           OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
           THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
           PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
           & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
           REPRESENTATIVE OF DTC (AND ANY PAYMENT 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 THE REGISTERED OWNER HEREOF,
           CEDE & CO., HAS AN INTEREST HEREIN.

           This Certificate evidences a fractional undivided beneficial interest
in an Underlying Note (as defined below) of the corresponding class issued by
CL&P Funding LLC, a Delaware limited liability company, a Swap Agreement, and
the proceeds thereof, held by a trust or registered assigns, as more fully
described herein.

           This Certificate shall not be deemed to constitute a debt or
liability of the State of Connecticut, acting through the office of the State
Treasurer (as defined in the Certificate Indenture) (the "Finance Authority"),
any other governmental agency or instrumentality or The Connecticut Light and
Power Company, a Connecticut corporation ("CL&P"), or any of its affiliates.
None of the Certificate, the Underlying Note, a Swap Agreement or the underlying
Transition Property (as defined in the Certificate Indenture) will be guaranteed
or insured by the State of Connecticut, the Finance Authority, the Trust (as

                                     -A1-1-
<PAGE>

defined below) or any other governmental agency or instrumentality or by CL&P or
its affiliates.

           Neither the full faith and credit nor the taxing power of the State
of Connecticut, the Finance Authority or any other governmental agency or
instrumentality is pledged to the payment of the principal of, or interest on,
this Certificate or the Underlying Note or Swap Agreement, or to the payments in
respect of the Transition Property, nor are the State of Connecticut, the
Finance Authority, the State Treasurer or any other governmental agency or
instrumentality in any manner obligated to make any appropriation for the
payment thereof.

           To the extent not otherwise defined herein, the capitalized terms
used herein have the meanings assigned to them in the Certificate Indenture.

           THIS CERTIFIES THAT CEDE & CO., as nominee for The Depository Trust
Company, for value received, is the registered owner of a Principal Amount
(stated above) of nonassessable, fully-paid, fractional undivided beneficial
interest in the related Underlying Note and the proceeds thereof held by
Connecticut RRB Special Purpose Trust CL&P-1 (the "Trust") or registered
assigns. The Trust is created pursuant to a Declaration of Trust dated as of
March [__], 2001 by First Union Trust Company, National Association, as Delaware
Trustee (the "Delaware Trustee"), and the Finance Authority, acting as settlor
thereunder pursuant to Connecticut General Statutes Sections 16-245e through and
including 16-245k (the "Statute"). This Certificate is issued under and is
subject to the terms, provisions, and conditions of, a Certificate Indenture
dated as of March [__], 2001 (the "Certificate Indenture"), by and among the
Delaware Trustee, First Union Trust Company, National Association, as
certificate trustee (the "Certificate Trustee"), and the Trust, a summary of
certain of the pertinent provisions of which is set forth below. This
Certificate is one of the duly authorized class of Certificates designated as
"Connecticut RRB Special Purpose Trust CL&P-1 Rate Reduction Certificates, Class
A-4" (herein called the "Class A-4 Certificates"). The Class A-4 Certificates
are one of a class of Certificates issued under the Certificate Indenture (such
Class A-4 Certificates, together with other Classes of Certificates issued on
the date hereof under the Certificate Indenture being herein called the
"Certificates"). The holder of this Certificate (the "Holder"), by virtue of its
acceptance hereof, assents and agrees to be bound by the terms of the
Certificate Indenture. This Class A-4 Certificate represents a fractional
undivided beneficial interest in the note of the corresponding class (the
"Underlying Note") issued by CL&P Funding LLC, as Note Issuer, and a Swap
Agreement, together with the payments on and proceeds thereof. The Underlying
Note is secured by a security interest in the property right created under the
Statute, pursuant to the order of the Connecticut Department of Public Utility
Control, issued on November 8, 2000 and supplemented on December 12, 2000, and
March12, 2001, in DPUC-00-05-01 (the "Financing Order"), representing the
irrevocable right of CL&P or its assignee to receive a certain nonbypassable
charge (as adjusted from time to time) from certain retail customers of CL&P's
distribution system, together with certain related collateral, all as more fully
described in the Note Indenture.

                                     -A2-2-
<PAGE>

           The aggregate principal amount of all Certificates of all Classes
issued under the Certificate Indenture equals the aggregate principal amount of
the Underlying Notes of all Classes, and all such Certificates are and will be
equally secured by the pledge and covenants made therein, except as otherwise
expressly provided or permitted in the Certificate Indenture.

           Subject to and in accordance with the terms of the Certificate
Indenture, there will be distributed on each quarterly [______] [__],[______]
[__], [______] [__] and [__________] [__] of each year or, if any such day is
not a Business Day, the next succeeding Business Day (each, a "Distribution
Date"), commencing on [_________] [__], 2001 to the Person in whose name this
Certificate is registered at the close of business on the last Business Day
immediately preceding the related Distribution Date or, if Definitive
Certificates are issued, the last day of the immediately preceding calendar
month (each, a "Record Date"), such Holder's fractional undivided interest in
the net payments made on the Underlying Note and Swap Agreement due on the
related Payment Date, the receipt of which has been confirmed by the Certificate
Trustee. Subject to and in accordance with the terms of the Certificate
Indenture, in the event that a Special Payment on the Underlying Note is
received by the Certificate Trustee, from funds then available to the
Certificate Trustee, there will be distributed on the applicable Special
Distribution Date, to the Person in whose name this Certificate is registered on
the Record Date preceding the Special Distribution Date, as applicable, such
Holder's fractional undivided share of such amount. The Special Distribution
Date will be determined as provided in the Certificate Indenture. The
Certificate Trustee will mail notice of each Special Payment and the related
Special Distribution Date to the Holder as provided in the Certificate
Indenture.

           Interest will be computed for each Payment Date after the initial
Payment Date on the basis of a 360-day year of twelve 30-day months. In
addition, on __________, 2001 (the initial Payment Date), the Certificate Issuer
promises, subject to the Certificate Indenture, to pay interest in the amount of
(i) LIBOR plus [ ]% multiplied by the number of days from and including the
Issuance Date to but excluding __ divided by 360, multiplied by the Original
Principal Amount of the Class A-4 Certificates, plus (ii) LIBOR plus [ ]%
multiplied by 91/360, multiplied by the Original Principal Amount of the Class
A-4 Certificates.

           Notwithstanding the foregoing, upon termination of the Class A-4 Swap
Agreement for any reason and for so long as there is no replacement Class A-4
Swap Agreement in effect, the Interest Rate for the Class A-4 Bonds shall be the
fixed rate of [__] percent per annum (the "Class A-4 The Gross Fixed Rate"),
effective from and including the Payment Date preceding such termination. Class
A-4 Gross Fixed Rate shall be computed on the basis of a 360-day year of twelve
30-day months or, for the initial Payment Date, the number of days from and
including the Issuance Date to but excluding the initial Payment Date. At such
time as the Certificate Issuer enters into a replacement Class A-4 Swap
Agreement pursuant to Section 3.03 of the Certificate Indenture, the Class A-4
Certificates shall revert to the Interest Rate of LIBOR plus [ ]%, effective as
of the next Payment Date following the date of such replacement Class A-4 Swap

                                     -A2-3-
<PAGE>

Agreement and computed on the basis of the actual number of days elapsed and a
360-day year.

           Upon the termination of the Class A-4 Swap Agreement and payment by
the Class A-4 Swap Counterparty of any termination payment or other similar
amount to the Certificate Issuer in accordance with the terms of the Class A-4
Swap Agreement, such amount shall be deposited directly into the Class A-4
Subaccount and paid to the Holders of the Class A-4 Certificates on the next
Payment Date.

           Distributions on this Certificate will be made as provided in the
Certificate Indenture by the Certificate Trustee by wire transfer or check
mailed to the Holder of record in the Certificate Register without the
presentation or surrender of this Certificate or the making of any notation
hereon, except that with respect to Certificates registered on the Record Date
in the name of the nominee of the Clearing Agency (initially, such nominee to be
Cede & Co.), payments will be made by wire transfer in immediately available
funds to the account designated by such nominee. Except as otherwise provided in
the Certificate Indenture and notwithstanding the above, the final distribution
on this Certificate will be made after due notice by the Certificate Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office of the Paying Agent or the office or agency
maintained for that purpose by the Certificate Trustee in The City of New York.

           Subject to and in accordance with the terms of the Certificate
Indenture, the Trust has represented and warranted under the Certificate
Indenture that the Trust constitutes a "financing entity" under Section
16-245e(a) of the Statute, and that the Certificates constitute "rate reduction
bonds" under Section 16-245e(a) of the Statute and that the Holders are entitled
to the rights and benefits thereunder. Pursuant to Section 16-245j(b) of the
Statute, the State of Connecticut, has pledged and agreed with the Note Issuer
and the Holders (the "State Pledge") as follows:

           Except as otherwise provided in this subsection, the state of
           Connecticut does hereby pledge and agree with the owners of
           transition property and holders of rate reduction bonds that the
           state shall neither limit nor alter the competitive transition
           assessment, transition property, financing orders, and all rights
           thereunder until the obligations, together with the interest thereon,
           are fully met and discharged, provided nothing contained in this
           subsection shall preclude the limitation or alteration if and when
           adequate provision shall be made by law for the protection of the
           owners and holders.

           In addition, the Trust has pledged and agreed with the Note Issuer
and the Holders that it will not act in a manner inconsistent with the State
Pledge and will not take any action that would impair any rights of the Note
Issuer or the Holders in the Notes, the Transition Property or the Certificates.

                                     -A2-4-
<PAGE>

           Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

           Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Certificate Trustee by manual
signature, this Certificate shall not be entitled to any benefit under the
Certificate Indenture or any other Basic Document or be valid for any purpose.

           THIS CERTIFICATE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE DOMESTIC LAW OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAW.

           Any reduction in the principal amount of any Certificate effected by
any distribution in respect of principal thereof shall be binding upon all
Holders of such Certificate and of any Certificate issued upon the registration
of transfer thereof or in exchange thereof or in lieu thereof, whether or not
noted thereon.

           It is expressly agreed and understood by the parties hereto that (a)
this Certificate is executed by First Union Trust Company, National Association,
and authenticated and delivered by First Union Trust Company, National
Association, not individually or personally but solely as Delaware Trustee and
Certificate Trustee, respectively, on behalf of the Trust in the exercise of the
powers and authority conferred and vested in them, (b) the representations,
undertakings and agreements herein made by the Delaware Trustee and Certificate
Trustee on behalf of the Trust are made and intended not as personal
representations, undertakings and agreements of either trustee, but are made and
intended for the purpose of binding only the Trust, (c) nothing herein contained
shall be construed as creating any liability on First Union Trust Company,
National Association, individually or personally, to perform any covenant either
expressed or implied herein, except in their capacity as Delaware Trustee and
Certificate Trustee, respectively, all such liability being expressly waived by
all Persons, and (d) under no circumstances shall First Union Trust Company,
National Association, be personally liable for the payment of any indebtedness
or expenses of the Trust, or be personally liable for the breach or failure of
any obligation, representation, warranty or covenant made or undertaken by the
Trust under the Certificate Indenture.

                                     -A2-5-
<PAGE>

           IN WITNESS WHEREOF, the Delaware Trustee on behalf of the Trust has
caused this Certificate to be duly executed.

                                    CONNECTICUT RRB SPECIAL PURPOSE TRUST CL&P-1

                                    By:      FIRST UNION TRUST COMPANY, NATIONAL
                                             ASSOCIATION, not in its individual
                                             capacity but solely as Delaware
                                             Trustee

                                    By:_________________________________________
                                         Name:
                                         Title:

                                     -A2-6-
<PAGE>

               CERTIFICATE TRUSTEE'S CERTIFICATE OF AUTHENTICATION

Dated:  [         ]

           This is one of the Certificates referred to in the within-mentioned
Certificate Indenture.

                                             FIRST UNION TRUST COMPANY, NATIONAL
                                             ASSOCIATION, not in its individual
                                             capacity but solely as Certificate
                                             Trustee

                                             By:_______________________________-
                                                  Name:
                                                  Title:

                                     -A2-7-
<PAGE>

                        [FORM OF REVERSE OF CERTIFICATE]

           The Certificates are limited in right of payment, all as more
specifically set forth on the face hereof and in the Certificate Indenture. All
payments or distributions made to Holders under the Certificate Indenture shall
be made only from the Trust Property and only to the extent that the Certificate
Trustee shall have sufficient income or proceeds from the Trust Property to make
such payments in accordance with the terms of the Certificate Indenture. Each
Holder, by its acceptance hereof, agrees that it will look solely to the income
and proceeds from the Trust Property to the extent available for distribution to
such Holder as provided in the Certificate Indenture. This Certificate does not
purport to summarize the Certificate Indenture and reference is made to the
Certificate Indenture for information with respect to the interests, rights,
benefits, obligations, proceeds, and duties evidenced hereby. A copy of the
Certificate Indenture may be examined during normal business hours at the
principal office of the Certificate Trustee, and at such other places, if any,
designated by the Certificate Trustee, by any Holder upon request.

           The Certificate Indenture permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights of the
Holders under the Certificate Indenture at any time by the Trust and the
Certificate Trustee with the consent of the Holders holding Certificates
representing not less than a majority of the aggregate Outstanding Amount of
Certificates of each affected Class issued by the Trust. Any such consent by the
Holder of this Certificate shall be conclusive and binding on such Holder and
upon all future Holders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange hereof or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Certificate
Indenture also permits the amendment thereof, in certain limited circumstances,
without the consent of the Holders of any of the Certificates.

           As provided in the Certificate Indenture and subject to certain
limitations therein set forth, the transfer of this Certificate is registerable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies maintained by the Certificate Trustee in
its capacity as Certificate Registrar, or by any successor Certificate
Registrar, in the Borough of Manhattan, The City of New York, duly endorsed or
accompanied by a written instrument of transfer in form satisfactory to the
Certificate Trustee and the Certificate Registrar duly executed by the Holder
hereof or such Holder's attorney duly authorized in writing, and thereupon one
or more new Certificates of authorized denominations evidencing the same
aggregate fractional undivided beneficial interest in the Underlying Note will
be issued to the designated transferee or transferees.

           The Certificates are issuable only as registered Certificates without
coupons in Minimum Denominations of $1,000 Original Principal Amount and
integral multiples of $1.00 in excess thereof; provided, however, that one
Certificate of each Class may be of a smaller denomination. As provided in the
Certificate Indenture and subject to certain limitations therein set forth,
Certificates are exchangeable for new Certificates of authorized denominations

                                     -A2-8-
<PAGE>

evidencing the same aggregate fractional undivided beneficial interest in the
Underlying Notes, as requested by the Holder surrendering the same.

           The Holder, by purchase of this Certificate, will be deemed to
represent that such purchase will not result in a non-exempt prohibited
transaction under the Internal Revenue Code of 1986, as amended, or the Employee
Retirement Income Security Act of 1974, as amended, and, in each case, the rules
and regulations thereunder.

           The Holder, by purchase of this Certificate, will be deemed to agree
to treat the Underlying Note as debt of the Note Issuer, secured by, among other
things, the Transition Property and other related collateral, for all purposes.

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

           The Certificate Trustee, the Certificate Registrar, and any agent of
the Certificate Trustee or the Certificate Registrar may treat the Person in
whose name this Certificate is registered as the owner hereof for all purposes,
and neither the Certificate Trustee, the Certificate Registrar, nor any such
agent shall be affected by any notice to the contrary.

           The obligations and responsibilities created by the Certificate
Indenture shall terminate with respect to the Certificates upon the distribution
to the Holders of all amounts required to be distributed to them pursuant to the
Certificate Indenture and the disposition of all property held as part of the
Trust Property, except certain indemnity obligations of the Note Issuer to the
Certificate Trustee under the Fee and Indemnity Agreement.

                                     -A2-9-
<PAGE>
                                   ASSIGNMENT

           Social Security or taxpayer I.D. or other identifying number of
assignee: _________________

           FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto

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

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

                         (name and address of assignee)

the within Class A-4 Certificate and all rights thereunder, and hereby
irrevocably constitutes and appoints __________________, attorney, to transfer
said Class A-4 Certificate on the books kept for registration thereof, with full
power of substitution in the premises.

Dated:  ______________________________          ________________________________
                                                Signature Guaranteed:

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

------------------
* NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Class A-4 Certificate
in every particular, without alteration, enlargement or any change whatsoever.

                                     -A2-10-
<PAGE>
                                    EXHIBIT B

                              CALCULATION OF LIBOR

           (a)_______On the interest determination date immediately preceding
the first day of each applicable Calculation Period, the Certificate Trustee
will determine LIBOR based on the offered rate for deposits in United States
dollars for the three-month period commencing on the first day of that
Calculation Period that appears on the page, USD-LIBOR-BBA, of the Dow Jones
Telerate Services as of 11:00 a.m., London time, on such interest determination
date (the "Telerate Page"). If no offered rate appears on the Telerate page,
LIBOR for such Calculation Period will be determined as described in clause (b)
below.

           (b)_______With respect to an interest determination date on which no
offered rate appears on the Telerate Page, the Certificate Trustee will request
the principal London office of each of four major banks in the London interbank
market, selected by the Certificate Trustee, to provide the Certificate Trustee
with its offered quotation for three-month deposits in United States dollars for
the applicable Calculation Period, commencing on the second London Banking Day
immediately following that interest determination date, to prime banks in the
London interbank market at approximately 11:00 a.m., London time, on such
interest determination date and in a principal amount that is representative for
a single transaction in United States dollars in that market at that time. If at
least two such quotations are provided, LIBOR for such Calculation Period will
be the arithmetic mean of those quotations. If fewer than two quotations are
provided, LIBOR for that Calculation Period will be the arithmetic mean of the
rates quoted at approximately 11:00 a.m. in The City of New York, on that
interest determination date by major banks in The City of New York selected by
the Certificate Trustee for loans in United States dollars to leading European
banks, for the Calculation Period commencing on the second London Banking Day
immediately following that Class A-4 interest determination date and in a
principal amount that is representative for a single transaction in United
States dollars in that market at that time.

           (c)_______If LIBOR cannot be determined in accordance with clauses
(a) or (b) above, then LIBOR will be determined to be the same as the rate which
applied during the previous Calculation Period.

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