Document:

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                                                                    EXHIBIT 10.3

                          SUBSCRIPTION ESCROW AGREEMENT

      This ESCROW AGREEMENT, dated as of, 2007 (the "Agreement") is entered
into by and among Shopoff Properties Trust, Inc., a Maryland corporation (the
"Company"), Shopoff Securities, Inc., a Delaware corporation (the
"Broker-Dealer"), and Wells Fargo Bank, N.A., a national banking association, as
escrow agent (the "Escrow Agent").

      WHEREAS, the Company has filed a Registration Statement on Form S-11
(Registration No. 333-[ ]) with the Securities and Exchange Commission (the
"SEC") to commence an initial public offering (the "Offering") of up to
20,100,000 shares of common stock ("Shares") with the first 2,000,000 Shares
being sold at $9.50 per Share, and the last 18,100,000 Shares being sold at
$10.00 per Share to the public, with a minimum offering (the "Minimum Offering")
of $19,000,000 in Shares (the "Minimum Amount"). The Shares are being sold on a
best-efforts basis through the Broker-Dealer;

      WHEREAS, the Company and the Broker-Dealer desire to establish an Escrow
Account (as defined below) for the deposit of the subscribers' subscription
funds raised in the Offering, together with any earnings thereon (the "Escrow
Property") in accordance with the terms of this Agreement;

      WHEREAS, the Escrow Agent agrees to maintain such an Escrow Account; and

      NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged by each of the parties hereto, the
parties hereto, intending to be legally bound, do hereby agree as follows:

SECTION 1. APPOINTMENT OF THE ESCROW AGENT. The Company and the Broker-Dealer
hereby appoint Wells Fargo Bank, N.A. as escrow agent in accordance with the
terms and conditions set forth herein, and the Escrow Agent hereby accepts such
appointment.

SECTION 2. PROCEEDS TO BE ESCROWED; SUBSCRIPTION DOCUMENTS TO BE ESCROWED.

      (a) A sample copy of the subscription agreement to be executed by each
subscriber for Shares in the Offering is attached as Exhibit A (the
"Subscription Agreement"). Each person desiring to purchase Shares in the
Offering will be required to complete and execute a Subscription Agreement and
to deliver to the Broker-Dealer such completed Subscription Agreement, together
with a check, draft, wire or money order (hereinafter referred to as an
"Instrument of Payment") in the amount of either $9.50 per share or $10.00 per
share, depending upon whether the Minimum Amount has been reached as the
subscriber shall be so advised by the Company, the Broker-Dealer or the Escrow
Agent after the Escrow Agent's receipt of a Minimum Offering Notice (as
hereinafter defined). The Broker-Dealer shall conduct its review of the
Subscription Agreements and the Instruments of Payment at the same location at
which the Subscription Agreements and Instruments of Payment are received from
subscribers. Any Subscription Agreement and Instrument of Payment not conforming
to the foregoing instructions shall be returned by the Broker-Dealer directly to
such subscriber not later than the end of the next business day following
receipt by the Broker-Dealer of such materials. If the Subscription

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Agreements and Instruments of Payment received by the Broker-Dealer conform to
the foregoing instructions, then by the end of the next business day following
receipt by the Broker-Dealer, the Broker-Dealer shall transmit the Subscription
Agreements to the Escrow Agent and shall effect a wire transfer in immediately
available federal funds from the Broker-Dealer to the Escrow Agent using the
wire transfer instructions attached hereto as Exhibit B (the "Wire Transfer
Instructions") of the subscribers' subscription funds represented by the
instructions of payment received by the Broker-Dealer (it being understood that
the Broker-Dealer will transmit all subscription funds to the Escrow Agent by
wire transfer regardless of the form of the instruction of payment received by
the Broker-Dealer and that such wire transfer shall specify the subscriber(s)
that it benefits).

      (b) Notwithstanding the foregoing, with respect to any Shares to be
purchased by a custodial account, the Broker-Dealer shall cause the custodian of
such account to deliver a completed Subscription Agreement for such account
directly to the Escrow Agent and to effect a wire transfer of such account's
subscription funds in immediately available federal funds to the Escrow Agent
using the Wire Transfer Instructions. The Broker-Dealer shall furnish to the
Escrow Agent with each delivery of Instruments of Payment a list of the
subscribers described in Section 3 of this Agreement.

      (c) All such funds received from subscribers in payment for the Shares so
delivered to the Escrow Agent by the Broker-Dealer shall be retained in escrow
by the Escrow Agent in a separate deposit account (the "Escrow Account") upon
the terms and conditions hereinafter set forth and invested as stated below. The
Escrow Agent shall have no duty to solicit the Investor Funds from subscribers.

      (d) The Escrow Property shall be held by the Escrow Agent in the Escrow
Account until such funds are either disbursed to the Company in accordance with
Section 4(a) hereof or returned to the subscribers in accordance with Section
4(b) hereof.

SECTION 3. IDENTITY OF SUBSCRIBERS. The Broker-Dealer shall furnish to the
Escrow Agent with each delivery of funds, as provided in Section 2 hereof, a
list of the persons who have paid money for the purchase of Shares showing the
name, address, tax identification number, state of residence, amount of Shares
subscribed for, and the amount of money paid. The information comprising the
identity of investors shall be provided to the Escrow Agent in the format set
forth in the List of Investors attached as Exhibit C. All proceeds so deposited
shall remain the property of the subscriber and shall not be subject to any
liens or charges by the Company, or the Escrow Agent, until released to the
Company as hereinafter provided.

      9 The Company hereby acknowledges the Escrow Agent's right to reject any
subscriber on the basis of an incomplete Subscription Agreement or lack of
payment of funds, it being understood that the Escrow Agent shall be entitled to
exercise such right in its sole discretion and shall not be held liable or
accountable therefor; provided, however, that the Company may in its sole
discretion direct the Escrow Agent to accept an incomplete Subscription
Agreement, and the Escrow Agent shall be protected in acting upon such
direction.

SECTION 4. DISBURSEMENT OF ESCROW PROPERTY. The Escrow Agent shall notify the
Company on a weekly basis (and more frequently if requested by the Company) of
the amount of funds

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in the Escrow Account as well as the activity in the Escrow Account since the
last report. The Escrow Property shall be disbursed as follows:

      (a) If payments of the Minimum Amount or more for Shares are obtained on
or prior to the date that is one year after the effective date of the
Registration Statement (the "Minimum Offering Expiration Date") and the Company
has delivered a written notice (the "Minimum Offering Notice") attached as
Exhibit D, signed jointly by two Authorized Persons (as defined in Section
12(p)) of the Company, stating that it has received and accepted Subscription
Agreements for the Minimum Amount of Shares, thereafter the Escrow Agent shall
pay out the Escrow Property when and as directed by any Authorized Person of the
Company. Upon the delivery of the Minimum Offering Notice, all interest accrued
on the Escrow Property shall be payable to the Company.

      (b) If the Escrow Agent does not receive the Minimum Offering Notice
within one (1) business day of the Minimum Offering Expiration Date, the Escrow
Agent shall promptly, in any event within ten business days following the
Minimum Offering Expiration Date, by check, refund to each investor at the
address appearing on the List of Investors, or at such other address as shall be
furnished to the Escrow Agent by the Company in writing, all sums paid by the
investor pursuant to his Subscription Agreement for Shares, together with the
interest accrued on such funds in the Escrow Account, which the Company shall
calculate and provide to the Escrow Agent and shall then notify the Company in
writing of such refunds. The Company agrees to use its best efforts to obtain an
executed IRS Form W-9 from each subscriber prior to the Minimum Offering
Expiration Date if the Escrow Agent is not in receipt of evidence that
subscriptions for the Minimum Amount have been accepted at the close of business
on the date which is one month before the Minimum Offering Expiration Date. In
the event that a subscriber fails to remit an executed Form W-9 to the Escrow
Agent prior to the date the Escrow Agent returns the subscriber's funds, the
Escrow Agent will be required to withhold a portion of the earnings attributable
to those subscribers at the applicable rate in accordance with Section 3406 of
the Internal Revenue Code of 1986, as amended.

      (c) Upon the termination of the Escrow Agreement, any remaining Escrow
Property shall be forwarded to the Company in accordance with the Company's
written directions.

SECTION 5. INVESTMENT OF THE ESCROW PROPERTY. Prior to the disbursement of
Escrow Property in accordance with the provisions of Section 4 hereof, all
Escrow Property shall be deposited in a Wells Fargo Bank, N.A. Money Market
Deposit Account pursuant to the requirements of Rule 15c2-4 All investments
attributable to Escrow Property shall be made by the Escrow Agent in the name of
"Wells Fargo Bank, N.A., as Escrow Agent."

SECTION 6. TERM OF ESCROW. This Agreement shall be effective as of the date the
Registration Statement is declared effective by the SEC as such date is promptly
notified to the Escrow Agent by the Company in writing. Unless otherwise
provided in this Agreement, final termination of this Agreement shall occur on
(1) the date that the Company and the Escrow Agent shall mutually agree in
writing to terminate this Agreement, or (2) after termination of this Offering,
the date on which all funds held in the Escrow Account have been distributed in
accordance with the terms hereof in each case. The provisions of Sections 8, 10
and 11 shall

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survive the termination of this Escrow Agreement and the earlier resignation or
removal of the Escrow Agent.

SECTION 7. ISSUANCE OF CERTIFICATES. Until the terms of the Escrow Agreement
with respect to Shares have been met and the funds hereunder received from
subscriptions for Shares have been released to the Company, the Company may not
issue any certificates or other evidence of Shares, except Subscription
Agreements.

SECTION 8. COMPENSATION OF THE ESCROW AGENT. As compensation for serving as the
Escrow Agent hereunder, the Escrow Agent shall receive from the Company the
fees, charges and reimbursement of expenses as agreed to between the Company and
Escrow Agent on Schedule A attached hereto. The Company shall reimburse the
Escrow Agent on demand for all loss, liability, damage, disbursements, advances
or expenses paid or incurred by it for which the Company is obligated to pay or
indemnify the Escrow Agent pursuant to the terms hereof in the administration of
its duties hereunder, including, but not limited to, all counsel, advisors' and
agents' fees and disbursements and all taxes or other governmental charges. The
obligations contained in this Section 8 shall survive the termination of this
Escrow Agreement and the resignation or removal of the Escrow Agent.

SECTION 9. RESIGNATION OF THE ESCROW AGENT. The Escrow Agent may resign and be
discharged from its duties hereunder at any time by giving thirty (30) calendar
days' prior written notice of such resignation to the Company. The Company may
remove the Escrow Agent at any time by giving thirty (30) calendar days' prior
written notice to the Escrow Agent. Upon such notice, a successor escrow agent
shall be appointed by the Company who shall provide written notice of such to
the resigning the Escrow Agent. Such successor escrow agent shall become the
escrow agent hereunder upon the resignation or removal date specified in such
notice. If the Company is unable to agree upon a successor escrow agent within
thirty (30) days after such notice, the Escrow Agent may, in its sole
discretion, deliver the Escrow Property to the Company at the address provided
herein or may apply to a court of competent jurisdiction for the appointment of
a successor escrow agent or for other appropriate relief. The costs and expenses
(including its attorneys' fees and expenses) incurred by the Escrow Agent in
connection with such proceeding shall be paid by the Company. Upon receipt of
the identity of the successor escrow agent, the Escrow Agent shall deliver the
Escrow Property then held hereunder to the successor Escrow Agent, less the
Escrow Agent's fees, costs and expenses or other obligations owed to the Escrow
Agent to be paid from any interest earned in respect of the Escrow Property, or
hold any interest earned in respect of the Escrow Property (or any portion
thereof), pending distribution, until all such fees, costs and expenses or other
obligations are paid. Upon its resignation and delivery of the Escrow Property
as set forth in this Section 9, the Escrow Agent shall be discharged from any
and all further obligations arising in connection with the Escrow Property or
this Agreement.

SECTION 10. INDEMNIFICATION OF THE ESCROW AGENT. The Company and the
Broker-Dealer hereby jointly and severally agree to indemnify, defend, protect
and hold harmless the Escrow Agent and its officers, directors, employees,
representatives and agents, from and against and reimburse the Escrow Agent for
any and all claims, expenses, obligations, liabilities, losses, damages,
injuries (to person, property, or natural resources), penalties, stamp or other
similar taxes, actions, suits, judgments, reasonable costs and expenses
(including reasonable attorney's

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fees and expenses) of whatever kind or nature regardless of their merit,
demanded, asserted or claimed against the Escrow Agent directly or indirectly
relating to, or arising from, claims against the Escrow Agent by reason of its
participation in the transactions contemplated hereby, including without
limitation all reasonable costs required to be associated with claims for
damages to persons or property, and reasonable attorneys' and consultants' fees
and expenses and court costs, except to the extent finally determined to have
been primarily caused by the Escrow Agent's gross negligence or willful
misconduct. The provisions of this Section 10 shall survive the termination of
this Agreement or the resignation or removal of the Escrow Agent.

SECTION 11. LIMITATIONS ON THE RESPONSIBILITIES OF THE ESCROW AGENT.

      (a) The duties, responsibilities and obligations of the Escrow Agent shall
be limited to those expressly set forth herein and no duties, responsibilities
or obligations shall be inferred or implied against the Escrow Agent. The Escrow
Agent shall not be subject to, nor required to comply with, any other agreement
to which the Company is a party, even though reference thereto may be made
herein, or to comply with any direction or instruction (other than those
contained herein or delivered in accordance with this Escrow Agreement) from the
Company or an entity acting on its behalf. The Escrow Agent shall not be
required to expend or risk any of its own funds or otherwise incur any
liability, financial or otherwise, in the performance of any of its duties
hereunder. The sole duty of the Escrow Agent shall be to receive subscription
funds and hold and invest them subject to release, in accordance herewith, and
the Escrow Agent shall be under no duty to determine whether the Company or the
Broker-Dealer is complying with requirements of this Agreement, the Offering,
any disclosure or marketing materials in connection therewith or any applicable
laws. The Company and the Broker-Dealer agree that the Escrow Agent had and has
no role in the preparation of the Offering documents, has not reviewed any such
documents and makes no representations or warranties with respect to the
information contained therein or omitted therefrom. The Escrow Agent shall have
no obligation, duty or liability with respect to compliance with any federal or
state securities, disclosure or tax laws concerning the Offering documents or
the issuance, offering or sale of the Shares. The Escrow Agent shall have no
duty or obligation to monitor the application and use of the subscription funds
once transferred to the Company, that being the sole obligation and
responsibility of the Company.

      (b) If at any time the Escrow Agent is served with any judicial or
administrative order, judgment, decree, writ or other form of judicial or
administrative process which in any way affects the Escrow Property (including
but not limited to orders of attachment or garnishment or other forms of levies
or injunctions or stays relating to the transfer of the Escrow Property), the
Escrow Agent is authorized to comply therewith in any manner it or legal counsel
of its own choosing deems appropriate; and if the Escrow Agent complies with any
such judicial or administrative order, judgment, decree, writ or other form of
judicial or administrative process, the Escrow Agent shall not be liable to any
of the parties hereto or to any other person or entity even though such order,
judgment, decree, writ or process may be subsequently modified or vacated or
otherwise determined to have been without legal force or effect.

      (c) The Escrow Agent shall not be liable for any action taken or omitted
or for any loss or injury resulting from its actions or its performance or lack
of performance of its duties hereunder in the absence of gross negligence or
willful misconduct on its part. In no event shall

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the Escrow Agent be liable (i) for acting in accordance with or conclusively
relying upon any instruction, notice, demand, certificate or document from the
Company or any entity acting on behalf of the Company, (ii) for any indirect,
consequential, punitive or special damages, regardless of the form of action and
whether or not any such damages were foreseeable or contemplated, (iii) for the
acts or omissions of its nominees, correspondents, designees, agents, subagents
or subcustodians, (iv) for the investment or reinvestment of any cash held by it
hereunder, in each case in good faith, in accordance with the terms hereof,
including without limitation any liability for any delays (not resulting from
its gross negligence or willful misconduct) in the investment or reinvestment of
the Escrow Property, or any loss of interest or income incident to any such
delays, or (v) for an amount in excess of the value of the Escrow Property,
valued as of the date of deposit, but only to the extent of direct money
damages.

      (d) The Escrow Agent may consult with legal counsel of its own choosing at
the expense of the Company as to any matter relating to this Escrow Agreement,
and the Escrow Agent shall not incur any liability in acting in good faith in
accordance with any advice from such counsel. If such expenses are to be billed
to the Company, the Company will be informed of such expenses before they are
incurred. Failure of the Escrow Agent to provide such notice will discharge the
Company's payment obligations hereunder.

      (e) The Escrow Agent shall not incur any liability for not performing any
act or fulfilling any duty, obligation or responsibility hereunder by reason of
any occurrence beyond the control of the Escrow Agent (including but not limited
to any act or provision of any present or future law or regulation or
governmental authority, any act of God or war, civil unrest, local or national
disturbance or disaster, any act of terrorism or the unavailability of the
Federal Reserve Bank wire or facsimile or other wire or communication facility).

      (f) The Escrow Agent shall be entitled to conclusively rely upon any
order, judgment, certification, demand, notice, instrument or other writing
delivered to it hereunder without being required to determine the authenticity
or the correctness of any fact stated therein or the propriety or validity or
the service thereof. The Escrow Agent may act in conclusive reliance upon any
instrument or signature believed by it to be genuine and may assume that any
person purporting to make any statement or execute any document in connection
with the provisions hereof has been duly authorized to do so.

      (g) The Escrow Agent shall not be responsible in any respect for the form,
execution, validity, value or genuineness of documents or securities deposited
hereunder, or for any description therein, or for the identity, authority or
rights of persons executing or delivering or purporting to execute or deliver
any such document, security or endorsement. The Escrow Agent shall not be called
upon to advise any party as to the wisdom in selling or retaining or taking or
refraining from any action with respect to any securities or other property
deposited hereunder.

      (h) The Escrow Agent shall not be under any duty to give the Escrow
Property held by it hereunder any greater degree of care than it gives other
similar escrow property and shall not be required to invest any funds held
hereunder except as directed in this Escrow Agreement.

      (i) At any time the Escrow Agent may request an instruction in writing
from the Company and may, at its own option, include in such request the course
of action it proposes to

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take and the date on which it proposes to act, regarding any matter arising in
connection with its duties and obligations hereunder. The Escrow Agent shall not
be liable for acting in accordance with such a proposal on or after the date
specified therein, provided that the specified date shall be at least three (3)
business days after the Company receives the Escrow Agent's request for
instructions and its proposed course of action, and provided further that, prior
to so acting, the Escrow Agent has not received the written instructions
requested.

      (j) When the Escrow Agent acts on any information, instructions,
communications, (including, but not limited to, communications with respect to
the delivery of securities or the wire transfer of funds) sent by telex,
facsimile, email or other form of electronic or data transmission, the Escrow
Agent, absent gross negligence on its part, shall not be responsible or liable
in the event such communication is not an authorized or authentic communication
of the Company or is not in the form the Company sent or intended to send
(whether due to fraud, distortion or otherwise). The Company shall indemnify the
Escrow Agent against any loss, liability, claim or expense (including legal fees
and expenses) it may incur with its acting in accordance with any such
communication.

      (k) In the event of any ambiguity or uncertainty hereunder or in any
notice, instruction or other communication received by the Escrow Agent
hereunder, the Escrow Agent may, in its sole discretion, refrain from taking any
action other than to retain possession of the Escrow Property, unless the Escrow
Agent receives written instructions, signed by the Company which eliminates such
ambiguity or uncertainty.

      (l) In the event of any dispute between or conflicting claims among the
Company and any other person or entity with respect to any Escrow Property, the
Escrow Agent shall be entitled, in its sole discretion, to refuse to comply with
any and all claims, demands or instructions with respect to such Escrow Property
so long as such dispute or conflict shall continue, and the Escrow Agent shall
not be or become liable in any way to the Company or any other person for
failure or refusal to comply with such conflicting claims, demands or
instructions. The Escrow Agent shall be entitled to refuse to act until, in its
sole discretion, either (i) such conflicting or adverse claims or demands shall
have been determined by a final order, judgment or decree of a court of
competent jurisdiction, which order, judgment or decree is not subject to
appeal, or settled by agreement between the conflicting parties as evidenced in
a writing satisfactory to the Escrow Agent or (ii) the Escrow Agent shall have
received security or an indemnity satisfactory to it sufficient to hold it
harmless from and against any and all losses which it may incur by reason of so
acting. Any court order, judgment or decree shall be accompanied by a legal
opinion by counsel for the presenting party to the effect that said order,
judgment or decree represents a final adjudication of the rights of the parties
by a court of competent jurisdiction, and that the time for appeal from such
order, judgment or decree has expired without an appeal having been filed with
such court. The Escrow Agent shall act on such court order and legal opinions
without further question. The Escrow Agent may, in addition, elect, in its sole
discretion, to commence an interpleader action or seek other judicial relief or
orders as it may deem, in its sole discretion, necessary. The costs and expenses
(including reasonable attorneys' fees and expenses) incurred in connection with
such proceeding shall be paid by, and shall be deemed an obligation of, the
Company.

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      (m) The Escrow Agent shall have no responsibility for the contents of any
writing of the arbitrators or any third party contemplated herein as a means to
resolve disputes and may conclusively rely without any liability upon the
contents thereof.

      (n) The Escrow Agent does not have any interest in the Escrow Property
deposited hereunder but is serving as escrow holder only and having only
possession thereof. The Company shall pay or reimburse the Escrow Agent upon
request for any transfer taxes or other taxes relating to the Escrow Property
incurred in connection herewith and shall indemnify and hold harmless the Escrow
Agent from any amounts that it is obligated to pay in the way of such taxes. Any
payments of income from this Escrow Account shall be subject to withholding
regulations then in force with respect to United States taxes. The Company will
provide the Escrow Agent with appropriate W-9 forms for tax identification
number certifications, or W-8 forms for non resident alien certifications. This
paragraph shall survive notwithstanding any termination of this Escrow Agreement
or the resignation or removal of the Escrow Agent.

      (o) The Escrow Agent shall provide to the Company weekly statements
identifying transactions, transfers or holdings of Escrow Property and each such
statement shall be deemed to be correct and final upon receipt thereof by the
Company unless the Escrow Agent is notified in writing, by the Company, to the
contrary within thirty (30) business days of the date of such statement.

SECTION 12. MISCELLANEOUS.

      (a) This Agreement embodies the entire agreement and understanding among
the parties relating to the subject matter hereof.

      (b) This Agreement shall be governed by and construed in accordance with
the laws of the State of California without reference to the principles of
conflict of laws.

      (c) All notices and other communications under this Agreement shall be in
writing in English and shall be deemed given when delivered personally, on the
next Business Day after delivery to a recognized overnight courier or mailed
first class (postage prepaid) or when sent by facsimile to the parties (which
facsimile copy shall be followed, in the case of notices or other communications
sent to the Escrow Agent, by delivery of the original) at the following
addresses (or to such other address as a party may have specified by notice
given to the other parties pursuant to this provision):

      If to the Company, to:

      Shopoff Properties Trust, Inc.
      8951 Research Drive
      Irvine, California  92618
      Attention: William A. Shopoff
      Telephone: (949) 417-1396

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      with a copy to:

      Manatt, Phelps, & Phillips, LLP
      11355 West Olympic Boulevard
      Los Angeles, California 90064
      Attention: Blase P. Dillingham, Esq.
      Telephone:  (310) 312-4159

      If to the Escrow Agent, to:

      Wells Fargo Bank, N.A.
      1445 Ross Avenue, 2nd Floor
      MAC T5303-022
      Dallas, Texas 75202
      Facsimile:  (214) 777-4086
      Attention:  Amy Perkins, Corporate Trust & Escrow Services

      If the Broker-Dealer, to:

      Shopoff Securities, Inc.
      8951 Research Drive
      Irvine, California  92618
      Attention: William A. Shopoff
      Telephone: (949) 417-1396

      (d) The headings of the Sections of this Agreement have been inserted for
convenience and shall not modify, define, limit or expand the express provisions
of this Agreement.

      (e) This Agreement and the rights and obligations hereunder of parties
hereto may not be assigned except with the prior written consent of the other
parties hereto. This Agreement shall be binding upon and inure to the benefit of
each party's respective successors and permitted assigns. Except as expressly
provided herein, no other person shall acquire or have any rights under or by
virtue of this Agreement. This Agreement is intended to be for the sole benefit
of the parties hereto, and (subject to the provisions of this Section 12(e))
their respective successors and assigns, and none of the provisions of this
Agreement are intended to be, nor shall they be construed to be, for the benefit
of any third person.

      (f) This Agreement may not be amended, supplemented or otherwise modified
without the prior written consent of the parties hereto.

      (g) The Escrow Agent makes no representation as to the validity, value,
genuineness or the collectability of any security or other document or
instrument held by or delivered to it.

      (h) Any payments of income from the Escrow Property shall be subject to
withholding regulations then in force with respect to United States taxes. The
Company will provide the Escrow Agent with its Employer Identification Number
for use by the Escrow Agent if necessary. It is understood that the Escrow Agent
shall be responsible for income reporting only with respect to income earned on
the Escrow Property and will not be responsible for any other reporting.

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      (i) This Agreement may be executed in two or more counterparts, each of
which shall be an original, but all of which together shall constitute one and
the same instrument.

      (j) The rights and remedies conferred upon the parties hereto shall be
cumulative, and the exercise or waiver of any such right or remedy shall not
preclude or inhibit the exercise of any additional rights or remedies. The
waiver of any right or remedy hereunder shall not preclude the subsequent
exercise of such right or remedy.

      (k) The Company hereby represents and warrants (i) that this Escrow
Agreement has been duly authorized, executed and delivered on its behalf and
constitutes its legal, valid and binding obligation and (ii) that the execution,
delivery and performance of this Escrow Agreement by the Company does not and
will not violate any applicable law or regulation.

      (l) The Broker-Dealer hereby represents and warrants (i) that this Escrow
Agreement has been duly authorized, executed and delivered on its behalf and
constitutes its legal, valid and binding obligation and (ii) that the execution,
delivery and performance of this Escrow Agreement by the Broker-Dealer does not
and will not violate any applicable law or regulation.

      (m) The invalidity, illegality or unenforceability of any provision of
this Escrow Agreement shall in no way affect the validity, legality or
enforceability of any other provision; and if any provision is held to be
unenforceable as a matter of law, the other provisions shall not be affected
thereby and shall remain in full force and effect.

      (n) No printed or other material in any language, including prospectuses,
notices, reports, and promotional material which mentions "Wells Fargo Bank,
N.A." or any of their respective affiliates by name or the rights, powers, or
duties of the Escrow Agent under this Escrow Agreement shall be issued by any
other parties hereto, or on such party's behalf, without the prior written
consent of the Escrow Agent.

      (o) For purposes of this Agreement, "Business Day" shall mean any day that
is not a Saturday or Sunday or a day on which banks are required or permitted by
law or executive order to be closed in the City of Irvine, California or the
City of Dallas, Texas.

      (p) For purposes of sending and receiving instructions or directions
hereunder, all such instructions or directions shall be, and the Escrow Agent
may conclusively rely upon such instructions or directions, delivered, and
executed by representatives of the Company designated on Scheduled B attached
hereto and made a part hereof (each such representative, an "Authorized Person")
which such designation shall include specimen signatures of such
representatives, as such Schedule B may be updated from time to time.

      IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.

                                        SHOPOFF PROPERTIES TRUST, INC.

                                        By:____________________________
                                           Name:
                                           Title:

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                                        SHOPOFF SECURITIES, INC.

                                        By: ____________________________
                                            Name:
                                            Title:

                                        WELLS FARGO BANK, N.A.
                                        as Escrow Agent

                                        By: ____________________________
                                            Name:
                                            Title:

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                                   SCHEDULE A

               DESCRIPTION OF SUBSCRIPTION ESCROW AGENT SERVICES:

                                       12
<PAGE>

Wells Fargo Bank                                       Greg L. Stites [WEllS
Corporate Trust Services          Vice President/Business Development  FARGO
400 West 15th Street, 1st Floor                    Tel:  512.344.8640  LOGO]
Mac T5656-013                                      Fax:  512.344.8621
Austin, TX  78701                        Greg.L.Stites@wellsfargo.com

                                SCHEDULE OF FEES
                   TO ACT AS SUBSCRIPTION ESCROW AGENT FOR THE
                          SHOPOFF PROPERTY TRUST, INC.

ACCEPTANCE FEE:                                                           WAIVED

      Initial Fees as they relate to Wells Fargo Bank acting in the capacity of
Escrow Agent - includes creation and examination of the Escrow Agreement;
acceptance of the Escrow appointment; setting up of Escrow Account(s) and
accounting records; and coordination of receipt of funds for deposit to the
Escrow Account.

      The Acceptance Fee is payable at time of Escrow Agreement execution.

<TABLE>
<CAPTION>
ESCROW AGENT ADMINISTRATION FEE:                     FOR UP TO 300 INVESTOR DEPOSITS:
--------------------------------
<S>                                                  <C>
$20,000.00
</TABLE>

For ordinary administration services by Escrow Agent - includes daily routine
account management; investment transactions; cash transaction processing
(including wires and check processing); disbursement of the funds in accordance
with the agreement; and mailing of trust account statements to all applicable
parties. Tax reporting for up to 300 entities or individuals is included in the
Escrow Agent Administration Fee. Should the escrow agent be required to actively
collect W-9s, or any additional tax information from the subscribers, an
additional reporting fee of $25 per event may be charged. Additionally, a sweep
fee of 20 basis points will be assessed by the Escrow Agent on the average
monthly balance for Money Market Fund or Money Market Demand Account (sweep)
Investments. Float credit received by the bank for receiving funds that remain
uninvested are deemed part of the Escrow Agent's compensation. Fees are due and
payable from the investment earnings within the escrow account and will be paid
there from as soon as possible. In the event investment earnings are not
sufficient to accommodate the Escrow Agent Administration Fee, or any additional
fees that may be charged, Shopoff Property Trust, Inc., or an affiliate, will
pay the fee. The Fee will not be prorated in case of early termination.

TRANSACTION CHARGES:

<TABLE>
<S>                                                               <C>
International Wire disbursements                                  $85 per wire
NSF checks, stop payments, return checks                          $35 per check
</TABLE>

WELLS FARGO'S BID IS BASED ON THE FOLLOWING ASSUMPTIONS:

-     Number of escrow funds/accounts to be established: One (1)

                                       13
<PAGE>

-     Number of Deposits to Escrow Account: Approximately Three Hundred (300)

-     Number of Withdrawals from Escrow Fund: Approximately Three Hundred (300)

-     Term of Escrow: Up to One (1) Year

-     THIS FEE SCHEDULE ASSUMES THAT BALANCES IN THE ESCROW ACCOUNT WILL BE
      INVESTED IN MONEY MARKET MUTUAL FUNDS OR MONEY MARKET DEMAND ACCOUNTS

-     ALL FUNDS WILL BE RECEIVED FROM OR DISTRIBUTED TO A DOMESTIC ENTITY

-     IF THE ACCOUNT(S) DOES NOT OPEN WITHIN THREE (3) MONTHS OF THE DATE SHOWN
      BELOW, THIS PROPOSAL WILL BE DEEMED TO BE NULL AND VOID

OUT OF POCKET EXPENSES:

We only charge for out-of-pocket expenses in response to specific tasks assigned
by the client. Therefore, we cannot anticipate what specific out-of-pocket items
will be needed or what corresponding expenses will be incurred. Possible
expenses would be, but are not limited to, express mail and messenger charges,
travel expenses to attend closing or other meetings. There are no charges for
indirect out-of- pocket expenses.

   THIS FEE SCHEDULE IS BASED UPON THE ASSUMPTIONS LISTED ABOVE WHICH PERTAIN
 TO THE RESPONSIBILITIES AND RISKS INVOLVED IN WELLS FARGO UNDERTAKING THE ROLE
OF ESCROW AGENT. THESE ASSUMPTIONS ARE BASED ON INFORMATION PROVIDED TO US AS OF
    THE DATE OF THIS FEE SCHEDULE. OUR FEE SCHEDULE IS SUBJECT TO REVIEW AND
  ACCEPTANCE OF THE FINAL DOCUMENTS. SHOULD ANY OF THE ASSUMPTIONS, DUTIES OR
 RESPONSIBILITIES CHANGE, WE RESERVE THE RIGHT TO AFFIRM, MODIFY OR RESCIND OUR
                                 FEE SCHEDULE.

                         SUBMITTED BY: Greg L. Stites - September 12, 2006
                                       Vice President/Business Development
                                       (512)  344-8640
                                       p#  44587

                                       14
<PAGE>

                                   SCHEDULE B

          AUTHORIZED REPRESENTATIVES OF SHOPOFF PROPERTIES TRUST, INC.

Name

______________________________________________
    Title

______________________________________________
   Specimen Signature

Name

______________________________________________
    Title

______________________________________________
   Specimen Signature

Name

______________________________________________
    Title

______________________________________________
   Specimen Signature

                                       15
<PAGE>

                                    EXHIBIT A

                             SUBSCRIPTION AGREEMENT

                                       A-1
<PAGE>

                                    EXHIBIT B

                           WIRE TRANSFER INSTRUCTIONS

                                       B-1

<PAGE>

                                    EXHIBIT C

                                LIST OF INVESTORS

      Pursuant to the Escrow Agreement dated   by and between Shopoff Properties
Trust, Inc., (the "Company"), Shopoff Securities, Inc., and Wells Fargo Bank,
N.A. (the "Escrow Agent"), the Company hereby certifies that the following
Investors have paid the following amounts of money for the purchase of
(the"Shares"), and the money has been deposited with the Escrow Agent:

1.    Name of Subscriber

      Mailing Address

      State of Residence

      Tax Identification Number

      Amount of Shares subscribed for

      Amount of money paid and deposited with Escrow Agent

2.    Name of Subscriber

      Mailing Address

      State of Residence

      Tax Identification Number

      Amount of Shares subscribed for

      Amount of money paid and deposited with Escrow Agent

                                       C-1

<PAGE>

                                    EXHIBIT D

                             MINIMUM OFFERING NOTICE

                              [Company Letterhead]

[DATE]

Wells Fargo Bank, N.A.
1445 Ross Avenue, 2nd Floor
MAC T5303-022
Dallas, Texas 75202
Attention:  Amy Perkins, Corporate Trust & Escrow Services
Telecopy:  (214) 777-4086

      You are hereby notified that the Company has received and accepted
Subscription Agreements for the Minimum Amount of Shares. You are further
notified that all conditions precedent to the issuance by the Company of this
Minimum Offering Notice, under the Escrow Agreement or any other agreement, have
been met. We therefore direct Wells Fargo Bank, N.A., as Escrow Agent, to
distribute the Escrow Property in the following manner:

      [Insert Wire Instructions]

Sincerely,

Authorized Person

Print Name

Authorized Person

Print Name

                                       D-1FIFTH SUPPLEMENTAL
INDENTURE 

FROM 

WISCONSIN PUBLIC
SERVICE CORPORATION 

TO 

U.S. BANK NATIONAL
ASSOCIATION
(SUCCESSOR TO FIRSTAR BANK, NATIONAL ASSOCIATION AND
FIRSTAR BANK,
MILWAUKEE, N.A., NATIONAL ASSOCIATION) 

TRUSTEE 

     _________________ 

Dated as of December 1,
2006 

SUPPLEMENTAL TO
INDENTURE 
Dated as of December
1, 1998 

Senior Debt Securities 

        This
FIFTH SUPPLEMENTAL INDENTURE is made as of the 1st day of December, 2006, by
and between WISCONSIN PUBLIC SERVICE CORPORATION, a corporation duly organized and
existing under the laws of the State of Wisconsin (the “Company”), and U.S. BANK
NATIONAL ASSOCIATION (successor to Firstar Bank, National Association and Firstar Bank
Milwaukee, N.A., National Association), a national banking association duly organized and
existing under the laws of the United States, as trustee (the “Trustee”). 

RECITALS OF THE
COMPANY: 

        WITNESSETH:
that 

        The
Company has heretofore executed and delivered its Indenture (hereinafter referred to as
the “Indenture”), made as of December 1, 1998; and 

        Section
3.1 of the Indenture provides that Securities may be issued from time to time in series
pursuant to a supplemental indenture specifying the terms of each series of Securities;
and 

        The
Company desires to establish a series of Securities to be designated “Senior Notes,
5.55% Series Due December 1, 2036 (the “Securities of the Series due 2036”); and 

        Section
10.1 of the Indenture provides that the Company and the Trustee may enter into indentures
supplemental thereto for the purposes, among others, of establishing the form or terms of
Securities of any series and adding to the covenants of the Company; and 

        The
execution and delivery of this Fifth Supplemental Indenture (herein, this
“Supplemental Indenture”) has been duly authorized by a Board Resolution; 

        NOW,
THEREFORE, this Supplemental Indenture 

        WITNESSETH,
that, in order to set forth the terms and conditions upon which Securities of the Series
due 2036 are, and are to be, authenticated, issued and delivered, and in consideration of
the sum of one dollar duly paid to it by the Trustee at the execution of this Supplemental
Indenture, the receipt whereof is hereby acknowledged, the Company covenants and agrees
with the Trustee for the equal and proportionate benefit of the respective Holders from
time to time of such Securities as follows: 

1 

ARTICLE I  
RELATION TO
INDENTURE; DEFINITIONS  

SECTION 1.1 

        This
Supplemental Indenture constitutes an integral part of the Indenture. 

SECTION 1.2 

        For
all purposes of this Supplemental Indenture: 

        (a)              Capitalized
terms used but not otherwise defined herein shall have the           respective meanings
assigned to such terms in the Indenture;  

        (b)              All
references herein to Articles and Sections, unless otherwise specified,           refer
to the corresponding Articles and Sections of this Supplemental Indenture;           and  

        (c)              The
terms “hereof,” “herein,” “hereby,”          “hereto,” “hereunder,” and
“herewith” refer to           this Supplemental Indenture.  

ARTICLE II  
THE
SECURITIES  

        There
is hereby established a series of Securities pursuant to Section 3.01 of the Indenture as
follows: 

        (a)              The
title of the Securities of the series hereby established is “Senior           Notes,
5.55% Series Due December 1, 2036.” 

        (b)              The
aggregate principal amount of the Securities of the Series due 2036 which           may
be authenticated and delivered under the Indenture (except for Securities
          authenticated and delivered upon registration of transfer of, or in exchange
          for, or in lieu of other Securities of such series pursuant to Sections 2.05,
          3.04, 3.05, 3.06, 10.06 or 12.07) shall initially be limited to One Hundred and
          Twenty-Five Million Dollars ($125,000,000), subject to the right of the Company
          to reopen the Securities of the Series due 2036 for the issuance of additional
          Securities of the Series due 2036 on the terms and subject to the conditions
          specified below.  

        (c)              The
Company shall have the right to reopen the Securities of the Series due 2036
          for the issuance of additional Securities of such series (“Additional
          Securities of the Series due 2036”). The issuance of any Additional
          Securities of the Series due 2036 shall constitute a further issuance of, and
          will be consolidated with, the Securities of the Series due 2036, so as to form
          a single series. The Additional Securities of the Series due 2036 shall be
          substantially in the form hereinafter recited, but may contain such changes as
          may be appropriate to reflect their date or dates of issuance. Where
appropriate           references to the Securities of the Series due 2036 in this
Supplemental           Indenture shall be deemed to include the Additional Securities of
the Series due           2036.  

2 

        (d)              The
Securities of the Series due 2036 are to be issued in permanent global form
          without coupons. The beneficial owners of interests in such permanent Global
          Security or Securities may not exchange such interests for Securities of such
          series other than in the manner provided in Section 2.05 of the Indenture. The
          Depositary for the Securities of the Series due 2036 shall be The Depositary
          Trust Company.  

        (e)              The
Stated Maturity of the Securities of the Series due 2036 is December           1, 2036.  

        (f)              The
Securities of the Series due 2036 shall bear interest at the rate of 5.55%           per
annum, and such interest shall accrue from December 1, 2006 (or from the           most
recent Interest Payment Date to which interest on the Securities of the           Series
due 2036 has been paid or provided for). The Interest Payment Dates for           the
Securities of the Series due 2036 shall be June 1 and December 1 in each           year
commencing June 1, 2007, and the Regular Record Date for the interest           payable
on any Interest Payment Date shall be the fifteenth day (whether or not           a
Business Day) preceding such Interest Payment Date.  

        (g)              Principal
of and interest on the Securities of the Series due 2036 shall be           payable in
U.S. Dollars at the Corporate Trust Office of the Trustee.  

        (h)              The
Securities of the Series due 2036 are subject to redemption in whole at any
          time or in part from time to time at the option and direction of the Company at
          a Redemption Price equal to the greater of (i) 100% of the principal amount of
          the Securities of the Series due 2036 to be redeemed or (ii) the sum of the
          present values of the remaining scheduled payments of principal and interest
          thereon (exclusive of interest accrued to the date of redemption), discounted
to           the Redemption Date on a semi-annual basis (assuming a 360 day year of
twelve           30-day months) at the Treasury Rate as hereinafter defined, plus fifteen
          hundredths of one percent (0.15%) plus in each case accrued and unpaid interest
          to the Redemption Date. Such Redemption Date shall be set forth in an
          Officers’ Certificate delivered to the Trustee on or before the Redemption
          Date and upon which the Trustee may conclusively rely.  

        For
purposes of this paragraph (h): 

        “Treasury
Rate” means, with respect to any Redemption Date, the rate per annum equal to the
semiannual equivalent yield to maturity or interpolated (on a day count basis) of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed
as a percentage of its principal amount) equal to the Comparable Treasury Price for such
Redemption Date. 

        “Comparable
Treasury Issue” means the United States Treasury security or securities selected by
an Independent Investment Banker as having an actual or interpolated maturity comparable
to the remaining term of the Notes that would be utilized, at the time of selection and in
accordance with customary financial practice, in pricing new issues of corporate debt
securities of comparable maturity to the remaining term of the Notes. 

        “Independent
Investment Banker” means one of the Reference Treasury Dealers appointed by the
Trustee after consultation with the Company. 

3 

        “Comparable
Treasury Price” means, with respect to any Redemption Date, (i) the average of
the Reference Treasury Dealer Quotations for the Redemption Date, after excluding the
highest and lowest Reference Treasury Dealer Quotations for the Redemption Date, or
(ii) if the Trustee obtains fewer than four Reference Treasury Dealer Quotations, the
average of all the quotations which the Trustee obtains. 

        “Reference
Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and
any Redemption Date, the average, as determined by the Trustee, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each case as a percentage of its
principal amount) quoted in writing to the Trustee by such Reference Treasury Dealer at
3:30 p.m., New York time, on the third business day preceding such Redemption Date. 

        “Reference
Treasury Dealer” means any primary U.S. Government securities dealer in the United
States (a “Primary Treasury Dealer”) selected by the Company. 

        (i)              The
Securities of the Series due 2036 shall not be subject to any sinking fund           and
shall not be redeemable at the option of the Holders thereof.  

        (j)              The
Securities of the Series due 2036 shall initially be issued in whole in the
          form of one or more Global Securities. If individual securities of the Series
          due 2036 are issued under the conditions specified in Section 2.05 of the
          Indenture, individual certificates will be issued in denominations of $1,000 or
          any integral multiple thereof.  

        (k)              The
Related Series of Collateral Bonds being delivered to the Trustee in           connection
with the issuance of the Securities of the Series due 2036 is the           Company’s
First Mortgage Bonds, Collateral Series E.  

        Such
Securities of the Series due 2036 and Additional Securities of the Series due 2036, if
any, shall be initially authenticated and delivered from time to time upon delivery to the
Trustee of the documents required by Section 3.1 of the Indenture and the form of
Securities for the Securities of the Series due 2036 and Additional Securities of the
Series due 2036, if any, substantially in the form of Security attached hereto as
Appendix I, which is incorporated herein by reference. 

ARTICLE III  
TRANSFER
OF COLLATERAL BONDS  

        The
Company hereby issues, delivers and transfers to the Trustee in connection with the
issuance of the Securities of the Series due 2036 One Hundred and Twenty-Five Million
Dollars ($125,000,000) aggregate principal amount of a related issue of Collateral Bonds
of the Company designated “First Mortgage Bonds, Collateral Series E”
(each, a “Related Issue,” as to the series of Securities it secures, and, the
“Collateral Bonds”), which has been fully registered in the name of the Trustee
in such capacity, to be held in trust for the benefit of the Holders from time to time of
the Related Issue of Securities and, if such transfer does not constitute a sale of the
Collateral Bonds to the Trustee, the Company hereby grants a perfected security interest
in the Collateral Bonds for the benefit of such Holders, in each case as security for any
and all obligations of the Company under the Indenture, this Supplemental Indenture and
the Related Issue of Securities, including but not limited to (1) the full and prompt
payment of the interest on, principal of, and premium, if any, on such Related Issue of
Securities when and as the same shall become due and payable in accordance with the terms
and provisions of the Indenture and this Supplemental Indenture and such Related Issue of
Securities, either at the Stated Maturity thereof, upon acceleration of the maturity
thereof or upon redemption, and (2) the full and prompt payment of any interest on such
Related Issue of Securities when and as the same shall become due and payable in
accordance with the terms and provisions of the Indenture and this Supplemental Indenture
and such Related Issue of Securities. The Trustee shall enforce all of its rights under
the First Mortgage Indenture as a holder of each Related Issue of Collateral Bonds
transferred to it as provided in this Article III for the benefit of the Holders of
the respective Related Issue of Securities and the proceeds of the enforcement of such
rights shall be applied by the Trustee to satisfy the Company’s obligations under the
Indenture, this Supplemental Indenture, and such Related Issue of Securities. 

4 

        The
Company shall make payments of the principal of, and premium or interest on each of the
Collateral Bonds to the Trustee, which payments shall be applied by the Trustee to
satisfaction of all obligations then due on the respective Related Issue of Securities. 

        The
Collateral Bonds shall not be sold or transferred by the Trustee until the earlier of the
Release Date or the prior retirement of the Related Issue of Securities through
redemption, repurchase or otherwise. Without limiting the generality of the foregoing, in
no event shall the Collateral Bonds be sold or become the absolute property of any person
in violation of the applicable provisions of Section 201.04(2) of the Wisconsin Statutes
or any successor statutory provision. The “Release Date” shall be the date that
all First Mortgage Bonds of the Company issued and outstanding under the First Mortgage
Indenture, other than the Collateral Bonds, have been retired (at, before or after the
maturity thereof) through payment, redemption or otherwise, provided that no Default or
Event of Default has occurred and, at such time, is continuing under the Indenture. 

        A
copy of the form of Collateral Bond is attached hereto as Appendix II and its terms
are hereby incorporated by reference herein. 

ARTICLE IV
 
MISCELLANEOUS  

SECTION 4.1 

        The
Trustee has accepted the amendment of the Indenture effected by this Supplemental
Indenture and agrees to execute the trust created by the Indenture as hereby amended, but
only upon the terms and conditions set forth in the Indenture, including the terms and
provisions defining and limiting the liabilities and responsibilities of the Trustee, and
without limiting the generality of the foregoing, the Trustee shall not be responsible in
any manner whatsoever for or with respect of any of the recitals or statements contained
herein, all of which recitals or statements are made solely by the Company, or for or with
respect to (a) the validity or sufficiency of this Supplemental Indenture or any of the
terms or provisions hereof, (b) the proper authorization hereof by the Company by
corporate action or otherwise, and (c) the due execution hereof by the Company. 

5 

SECTION 4.2 

        This
Supplemental Indenture shall be construed in connection with and as a part of the
Indenture. 

SECTION 4.3 

        (a)              If
any provision of this Supplemental Indenture conflicts with another provision
          of the Indenture required to be included in indentures qualified under the
Trust           Indenture Act of 1939, as amended (as enacted prior to the date of this
          Supplemental Indenture), by any of the provisions of Sections 310 to 317,
          inclusive, of said act, such required provision shall control.  

        (b)              In
case any one or more of the provisions contained in this Supplemental           Indenture
or in the Securities issued hereunder should be invalid, illegal, or
          unenforceable in any respect, the validity, legality and enforceability of the
          remaining provisions contained herein and therein shall not in any way be
          affected, impaired, prejudiced or disturbed thereby.  

SECTION 4.4 

        Whenever
in this Supplemental Indenture either of the parties hereto is named or referred to, such
name or reference shall be deemed to include the successors or assigns of such party, and
all the covenants and agreements contained in this Supplemental Indenture by or on behalf
of the Company or by or on behalf of the Trustee shall bind and inure to the benefit of
the respective successors and assigns of such parties, whether so expressed or not. 

SECTION 4.5 

        (a)              This
Supplemental Indenture may be simultaneously executed in several           counterparts,
and all such counterparts executed and delivered, each as an           original, shall
constitute but one and the same instrument.  

        (b)              The
descriptive headings of the several Articles of this Supplemental Indenture
          were formulated, used and inserted in this Supplemental Indenture for
          convenience only and shall not be deemed to affect the meaning or construction
          of any of the provisions hereof.  

6 

        IN
WITNESS WHEREOF, WISCONSIN PUBLIC SERVICE CORPORATION has caused this Supplemental
Indenture to be executed by its Chairman, Chief Executive Officer, President, Vice
Chairman or a Vice President, or any other officer selected by the Board of Directors, and
its corporate seal to be hereunto affixed, duly attested by its Secretary or an Assistant
Secretary, and U.S. BANK NATIONAL ASSOCIATION, as Trustee as aforesaid, has caused this
Supplemental Indenture to be executed by one of its authorized signatories, as of December
1, 2006. 

		WISCONSIN PUBLIC SERVICE
		  CORPORATION
	[SEAL]
	

 	By: /s/ Joseph P. O'Leary
		       Joseph P. O'Leary
		       Senior Vice President and Chief Financial
		         Officer

ATTEST: 

/s/ Barth J. Wolf
         
      Barth J. Wolf          
      Secretary 

		U.S. BANK NATIONAL ASSOCIATION
	

 	By: /s/ Peter M. Brennan
		       Peter M. Brennan
		       Vice President

7 

APPENDIX I 

$___________ 

CUSIP: No. 976843-[BE1] 

        THIS
SECURITY IS A GLOBAL SECURITY REGISTERED IN THE NAME OF THE DEPOSITARY (REFERRED TO
HEREIN) OR A NOMINEE THEREOF AND UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
THE INDIVIDUAL SECURITIES REPRESENTED HEREBY, THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR
ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.* 

        UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY TRUST
COMPANY, A NEW YORK CORPORATION (55 WATER STREET, NEW YORK, NEW YORK), TO THE TRUSTEE 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 THE DEPOSITARY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO.,
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.* 

	 	
*To
be included so long as Security is a Global Security. 

8 

WISCONSIN PUBLIC
SERVICE CORPORATION 
Senior Note, 5.55%
Series Due December 1, 2036 

        WISCONSIN
PUBLIC SERVICE CORPORATION, a corporation duly organized and existing under the laws of
Wisconsin (herein called the “Company,” which term includes any successor
corporation under the Indenture hereinafter referred to), for value received, hereby
promises to pay to ____________________, or registered assigns, the principal sum of
____________________ on December 1, 2036 and to pay interest thereon from December 1, 2006
or from the most recent Interest Payment Date to which interest has been paid or duly
provided for, semi-annually on June 1 and December 1 in each year, commencing June 1,
2007, at the rate of 5.55% per annum, until the principal hereof is paid or made available
for payment and (to the extent that the payment of such interest shall be legally
enforceable) at the rate of 5.55% per annum on any overdue principal and premium and on
any overdue installment of interest. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to
the Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such interest, which
shall be the close of business on the fifteenth calendar day next preceding such Interest
Payment Date (whether or not such day is a Business Day). Any such interest not so
punctually paid or duly provided for will forthwith cease to be payable to the Holder on
such Regular Record Date and may either be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee,
notice whereof shall be given to Holders of Securities of this series not less than 10
days prior to such Special Record Date, or be paid at any time in any other lawful manner
not inconsistent with the requirements of any securities exchange on which the Securities
of this series may be listed, and upon such notice as may be required by such exchange,
all as more fully provided in said Indenture. 

        Payment
of the principal of (and premium, if any) and any such interest on this Security will be
made at the office or agency of the Trustee maintained for that purpose, in Milwaukee,
Wisconsin, in Dollars, provided, however, that at the option of the Company payment of
interest may be made by wire transfer of immediately available funds into the account
specified by the Depositary so long as this note is in the form of Global Security and
otherwise by check mailed to the address of the Person entitled thereto as such address
shall appear in the Security Register. 

        Prior
to the Release Date (as hereinafter defined), the Securities will be secured by First
Mortgage Bonds, Collateral Series E (the “Collateral Bonds”), issued and
delivered by the Company to the Trustee for the benefit of the Holders of the Securities
(as defined herein), issued under the First Mortgage and Deed of Trust dated January 1,
1941, from the Company to First Wisconsin Trust Company (subsequently succeeded by U.S.
Bank National Association), Milwaukee, Wisconsin, as supplemented and amended by the
supplemental indentures thereto (the “First Mortgage Indenture”). Reference is
made to the First Mortgage Indenture and the Indenture for a description of the rights of
the Trustee as holder of the Collateral Bonds, the property mortgaged and pledged under
the First Mortgage Indenture, the rights of the Company and of the Mortgage Trustee in
respect thereof, the duties and immunities of the applicable Mortgage Trustee, the terms
and conditions upon which the Collateral Bonds are held by the Trustee for the benefit of
the Holders of Securities, and the circumstances under which additional First Mortgage
Bonds may be issued. 

9 

        From
and after such time as all First Mortgage Bonds (other than Collateral Bonds) issued under
the First Mortgage Indenture have been retired through payment, redemption or otherwise
(including those First Mortgage Bonds the payment for which has been provided for in
accordance with the First Mortgage Indenture) at, before or after the maturity thereof and
provided that no default or event of default under the Indenture has occurred and is
continuing (the “Release Date”), the Collateral Bonds shall cease to secure the
Securities in any manner, and, at the option of the Company, the Securities either (a)
will become unsecured general obligations of the Company or (b) will be secured by First
Mortgage Bonds issued under an Indenture other than the First Mortgage Indenture. In
certain circumstances prior to the Release Date as provided in the Indenture, the Company
is permitted to reduce the aggregate principal amount of an issue of Collateral Bonds held
by the Trustee, but in no event prior to the Release Date to an amount less than the
aggregate principal amount outstanding of the related issue of Securities initially issued
contemporaneously with such Collateral Bonds. 

        Reference
is hereby made to the further provisions of this Security 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 has been executed by the Trustee by manual
signature, this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose. 

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

		WISCONSIN PUBLIC SERVICE CORPORATION
	

 	By___________________________
	

Attest:
	___________________________	                [SEAL]

10 

Form of Trustee’s
Certificate of Authentication. 

Dated: _______________ 

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

___________________________________________
As Trustee 

By___________________________________________

Authorized Signatory  

Form of Reverse of
Security. 

        This
Security is one of a duly authorized issue of securities of the Company (herein called the
“Securities”), issued and to be issued in one or more series under an Indenture,
dated as of December 1, 1998 (herein called the “Indenture”), between the
Company and a predecessor of U.S. Bank National Association, as Trustee (herein called the
“Trustee,” which term includes any successor trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of the terms
upon which the Securities are, and are to be, authenticated and delivered. This Security
is one of the series designated on the face hereof, limited in aggregate principal amount
to One Hundred and Twenty-Five Million Dollars ($125,000,000), subject to the right of the
Company to reopen the Securities of this series for the issuance of additional Securities
of this series on the terms and subject to the conditions specified in the Fifth
Supplemental Indenture to the Indenture. 

        The
Securities of this series are subject to redemption upon not less than 30 nor more than 45
days’ notice by first class mail, in whole at any time or in part from time to time
at the option of the Company at a Redemption Price equal to the greater of (i) 100% of the
principal amount of the Securities of this series to be redeemed or (ii) the sum of the
present values of the remaining scheduled payments of principal and interest thereon
(exclusive of interest accrued to the date of redemption), discounted to the Redemption
Date on a semi-annual basis (assuming a 360 day year of twelve 30-day months) at the
Treasury Rate as defined in the Fifth Supplemental Indenture to the Indenture, plus
fifteen hundredths of one percent (0.15%) plus in each case accrued and unpaid
interest to the Redemption Date. 

        In
the event of redemption of this Security in part only, a new Security or Securities of
this series for the unredeemed portion hereof will be issued in the name of the Holder
hereof upon the cancellation hereof. 

        If
any Event of Default with respect to Securities of this series shall occur and be
continuing, the principal of the Securities of this series may be declared due and payable
in the manner and with the effect provided in the Indenture. Upon payment (i) of the
amount of principal so declared due and payable and (ii) of interest on any overdue
principal and overdue interest (in each case to the extent that the payment of such
interest shall be legally enforceable), all of the Company’s obligations in respect
of the payment of the principal of and interest, if any, on the Securities of this series
shall terminate. 

11 

        This
Security is subject to Defeasance as described in the Indenture. 

        The
Indenture may be modified by the Company and the Trustee without consent of any Holder
with respect to certain matters as described in the Indenture. In addition, the Indenture
permits, with certain exceptions as therein provided, the amendment thereof and the
modification of the rights and obligations of the Company and the rights of the Holders of
the Securities of each series to be affected under the Indenture at any time by the
Company and the Trustee with the consent of the Holders of a majority in principal amount
of the Securities at the time Outstanding of each series to be affected. The Indenture
also contains provisions permitting the Holders of a majority in principal amount of the
Securities of each series at the time Outstanding, on behalf of the Holders of all
Securities of such series, to waive certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Security shall bind such
Holder and all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security. 

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

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

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

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

12 

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

        The
Indenture imposes certain limitations on the ability of the Company to, among other
things, merge or consolidate with any other Person or sell, assign, transfer or lease all
or substantially all of its properties or assets. All such covenants and limitations are
subject to a number of important qualifications and exceptions. The Company must report
periodically to the Trustee on compliance with the covenants in the Indenture. 

        A
director, officer, employee or shareholder, as such, of the Company shall not have any
liability for any obligations of the Company under this Security or the Indenture or for
any claim based on, in respect of, or by reason of, such obligations or their creation.
Each Holder, by accepting a Security, waives and releases all such liability. The waiver
and release are part of the consideration for the issuance of this Security. 

        Pursuant
to a recommendation promulgated by the Committee on Uniform Security Identification
Procedures (“CUSIP”), the Company has caused CUSIP numbers to be printed on the
Securities of this series as a convenience to the Holders of the Securities of this
series. No representation is made as to the correctness or accuracy of such numbers as
printed on the Securities of this series and reliance may be placed only on the other
identification numbers printed hereon. 

        All
capitalized terms used in this Security without definition which are defined in the
Indenture shall have the meanings assigned to them in the Indenture. 

13 

ASSIGNMENT FORM 

        To
assign this Security, fill in the form below:  (I) or (we) assign and transfer this
Security  to  

____________________________________________________________________________________________________________________________
                                                                  
(Insert assignee's
social security or tax I.D. number) 

____________________________________________________________________________________________________________________________

____________________________________________________________________________________________________________________________

____________________________________________________________________________________________________________________________

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

and irrevocably
appoint__________________________________________________________ agent to transfer this
Security on the books of the Company. The agent may substitute another to act for him. 

	Dated:_______________________	Your Signature:_____________________________
		                            (Sign exactly as your
		                            name appears on the other
		                            side of this Security)

	Signature Guaranty:  	_____________________________________________________________________________
                           
[Signatures must be guaranteed by an "eligible guarantor
institution" meeting the                            requirements of the Transfer Agent,
which requirements will include membership or                            participation in
STAMP or such other signature guarantee program as may be determined
                           by the Transfer Agent in addition to, or in substitution for,
STAMP, all in accordance                            with the Exchange Act.]

Social Security Number or Taxpayer
Identification
Number:_______________________________________  

14 

APPENDIX II 

	No. R-	$_____________ 

(Form of Bond of
Collateral Series E) 

WISCONSIN PUBLIC
SERVICE CORPORATION 

(Incorporated under the
laws of the State of Wisconsin)
First Mortgage Bond, Collateral Series E 

THE FIRST MORTGAGE BONDS, COLLATERAL
SERIES E (HEREINAFTER, “COLLATERAL BONDS”), REPRESENTED BY THIS CERTIFICATE
ARE BEING ISSUED AND DELIVERED BY THE COMPANY TO U. S. BANK NATIONAL ASSOCIATION AS
TRUSTEE (IN SUCH CAPACITY, THE “SENIOR TRUSTEE”) UNDER AN INDENTURE, DATED AS OF
DECEMBER 1, 1998, BETWEEN THE COMPANY AND A PREDECESSOR OF THE SENIOR TRUSTEE, AS
PREVIOUSLY SUPPLEMENTED AND AS SUPPLEMENTED BY THE FIFTH SUPPLEMENTAL INDENTURE THERETO
DATED AS OF DECEMBER 1, 2006 (AS SO SUPPLEMENTED, THE “SENIOR INDENTURE”). THE
COLLATERAL BONDS ARE TO BE HELD IN TRUST AS COLLATERAL FOR THE BENEFIT OF THE HOLDERS OF
THE SENIOR NOTES, 5.55% SERIES DUE DECEMBER 1, 2036 (THE “RELATED SECURITIES”)
ISSUED PURSUANT TO THE SENIOR INDENTURE. 

THE COLLATERAL BONDS MAY NOT BE SOLD
OR OTHERWISE TRANSFERRED (EXCEPT TO A SUCCESSOR SENIOR TRUSTEE) UNTIL THE EARLIER OF THE
RELEASE DATE (AS DEFINED BELOW) OR THE PRIOR RETIREMENT OF THE RELATED SECURITIES THROUGH
REDEMPTION, REPURCHASE OR OTHERWISE. 

THE COMPANY SHALL MAKE PAYMENTS OF
THE PRINCIPAL OF, AND PREMIUM, IF ANY, AND INTEREST ON, THE COLLATERAL BONDS, TO THE
SENIOR TRUSTEE, WHICH PAYMENTS SHALL BE APPLIED BY THE SENIOR TRUSTEE TO THE SATISFACTION
OF OBLIGATIONS ON THE RELATED SECURITIES. 

THE MATURITY DATE SPECIFIED ABOVE IS
ALSO THE MATURITY DATE OF THE RELATED SECURITIES. 

        WISCONSIN
PUBLIC SERVICE CORPORATION, a corporation organized and existing under the laws of the
State of Wisconsin (hereinafter called the Company), for value received, hereby promises
to pay to U.S. BANK NATIONAL ASSOCIATION, as trustee for the benefit of the holders of the
Related Securities, or registered assigns (in such capacity, the “Senior
Trustee”), at the Corporate Trust Services Office of U.S. Bank National Association,
in Milwaukee, Wisconsin, on the 1st day of December, 2036, the sum of One
Hundred Twenty-Five Million Dollars ($125,000,000) in lawful money of the United States of
America, and to pay interest thereon from the date hereof at the rate of 5.55% per annum
in like money, until the principal hereof becomes due and payable, said interest being
payable on the 1st day of June and on the 1st day of December in
each year commencing June 1, 2007. The principal and interest so payable on any
June 1 or December 1 will be paid to the person or entity in whose name this
bond is registered, at the address thereof as it appears on the Company’s books for
registration and registration of transfer. 

15 

        The
provisions of this bond are continued on the reverse hereof or attached pages and such
continued provisions shall for all purposes have the same effect as though fully set forth
at this place. 

        This
bond shall not be valid or become obligatory for any purpose unless and until U.S. Bank
National Association (successor to First Wisconsin Trust Company), as Trustee under the
Indenture, or its successors thereunder, shall have signed the certificate of
authentication endorsed hereon. 

        IN
WITNESS WHEREOF, WISCONSIN PUBLIC SERVICE CORPORATION has caused this bond to be signed in
its name by the manual or facsimile signature of its President or a Vice President and its
corporate seal or a facsimile thereof to be hereto affixed and attested by the manual or
facsimile signature of its Secretary or an Assistant Secretary. 

Dated as of: December 1,
2006 

		WISCONSIN PUBLIC SERVICE CORPORATION,
	

 	BY:________________________________
		      _____________________President

Attest: 

________________________________

_____________________ Secretary 

16 

(Form of
Trustee’s Certificate) 

        This
bond is one of the bonds of the series designated therein, described in the within
mentioned Indenture and Supplemental Indenture. 

		U.S. BANK NATIONAL ASSOCIATION,
		    As Trustee
	

 	By:________________________________
		                Authorized Signature

(Text appearing on
reverse side of bond or attached pages) 

        This
bond is one of a duly authorized issue of bonds of the Company, known as its First
Mortgage Bonds, of the Series and designation indicated on the face hereof, which
issue of bonds consists, or may consist, of several series of varying denominations, dates
and tenors, all issued and to be issued under and equally secured (except in so far as a
sinking fund, or similar fund, established in accordance with the provisions of the
Indenture, may afford additional security for the bonds of any specific series) by a First
Mortgage and Deed of Trust (herein called the “Indenture”) dated as of
January 1, 1941, executed by the Company to First Wisconsin Trust Company
(subsequently succeeded by U.S. Bank National Association, herein called the Trustee), as
Trustee, to which Indenture and all instruments supplemental thereto reference is hereby
made for a description of the property mortgaged and pledged, the nature and extent of the
security, the rights of the holders of the bonds as to such security, and the terms and
conditions upon which the bonds may be issued under the Indenture and any instruments
supplemental thereto and are secured. The principal hereof may be declared or may become
due on the conditions, in the manner and at the time set forth in the Indenture, upon the
happening of a completed default as in the Indenture provided. This bond is one of a
series created by a Supplemental Indenture (herein called the “Supplemental
Indenture”) dated as of December 1, 2006, between the Company and the Trustee, which
is supplemental to the Indenture. 

        The
Senior Trustee has agreed pursuant to the Senior Indenture to hold the Bonds of this
Series as collateral for the benefit of the holders of the Related Securities under all
circumstances and not to transfer (except to a successor trustee) such Bonds until the
earlier of the Release Date or the prior retirement of the Related Securities through
redemption, repurchase or otherwise. “Release Date” means the date on which all
First Mortgage Bonds of the Company issued and outstanding under the Indenture, other than
the Bonds of this Series and other Bonds pledged as security for Securities issued under
the Senior Indenture (collectively “Collateral Bonds”), have been retired (at,
before or after the maturity thereof) through payment, redemption or otherwise provided
that no default or event of default has occurred and is continuing under the Senior
Indenture. On the Release Date, the Senior Trustee shall deliver to the Company for
cancellation all Collateral Bonds, and the Company shall cause the Senior Trustee to
provide notice to all holders of Related Securities of the occurrence of the Release Date.
As a result, on the Release Date, the Bonds of this Series shall cease to secure the
Related Securities. Following the Release Date, the Company shall cause the Indenture to
be discharged, and the Company shall not issue any additional Collateral Bonds thereunder,
and from and after the Release Date, the Company’s obligations in respect of the
Collateral Bonds shall be satisfied and discharged. 

17 

        With
the consent of the Company and to the extent permitted by and as provided in the Indenture
and/or any instruments supplemental thereto, the rights and obligations of the Company
and/or of the holders of the bonds, and/or terms and provisions of the Indenture and/or of
any instruments supplemental thereto may be modified or altered by consent of the holders
of at least seventy percent (70%) in principal amount of the bonds then outstanding under
the Indenture and any instruments supplemental thereto (excluding bonds challenged and
disqualified from voting by reason of the interest of the Company or of certain related
persons therein as provided in the Indenture); provided that no such modification or
alteration shall permit the extension of the maturity of the principal of this bond or the
reduction in the rate of interest hereon or any other modification in the terms of payment
of such principal or interest or the taking of certain other action as more fully set
forth in the Indenture without the consent of the holder hereof. 

        The
Company and the Trustee may deem and treat the person in whose name this bond is
registered as the absolute owner hereof for the purpose of receiving payment of or on
account of the principal hereof and interest hereon and for all other purposes, and shall
not be affected by any notice to the contrary. 

        The
bonds of this Series are subject to redemption, prior to maturity, at the option of the
Company in whole at any time or in part from time to time, upon payment of a redemption
price equal to the greater of (i) 100% of the principal amount of the bonds to be redeemed
or (ii) the sum of the present values of the remaining scheduled payments of principal and
interest thereon (exclusive of interest accrued to the date of redemption), discounted to
the redemption date on a semi-annual basis (assuming a 360 day year of twelve 30-day
months) at the Treasury Rate (as defined in the Supplemental Indenture), plus
fifteen hundredths of one percent (0.15%) plus in each case accrued and unpaid
interest to the redemption date, all subject to the conditions and as more fully set forth
in the Indenture and the Supplemental Indenture. 

        Notice
of any such redemption shall be hand delivered or mailed not less than thirty (30) days
prior to the redemption date to the registered owner of the bonds so to be redeemed, at
its address as the same shall appear on the Company’s books for registration and
registration of transfer, all subject to the conditions and as more fully set forth in the
Indenture and in the Supplemental Indenture, except that no newspaper publication shall be
required. 

        In
the event that an event of default under Section 6.01 of the Senior Indenture has occurred
and is continuing, and the Senior Trustee has declared the principal of all of the Related
Securities then outstanding immediately due and payable (or such principal has become ipso
facto immediately due and payable) under Section 6.02 of the Senior Indenture, then the
Company shall call for redemption and redeem all of the bonds of this series then
outstanding at a price equal to 100% of the principal amount thereof, together with
accrued and unpaid interest thereon to the redemption date. The redemption date shall be
the accelerated maturity date of the Related Securities, and no prior notice of such
redemption to the Trustee or the Senior Trustee shall be required. 

18 

        This
bond is nontransferable except to the Senior Trustee and successor trustees thereto. To
the extent that it is transferable, it is transferable by the registered owner hereof in
person or by attorney duly authorized in writing, on books of the Company to be kept for
that purpose at the corporate trust services office of the Trustee at Milwaukee,
Wisconsin, upon surrender hereof for cancellation at said office and upon presentation of
a written instrument of transfer duly executed. Thereupon the Company shall issue in the
name of the transferee, and the Trustee shall authenticate and deliver, a new registered
bond or bonds without coupons of the same maturity and interest rate and of equal
aggregate principal amount. Any such transfer shall be subject to the terms and conditions
specified in the Indenture and the Supplemental Indenture. 

        No
recourse shall be had for the payment of principal of, premium, if any, or interest on
this bond, or any part thereof, or of any claim based hereon or in respect hereof or of
the Indenture or any instrument supplemental thereto, against any incorporator, or any
past, present or future stockholder, officer or director of the Company or of any
predecessor or successor corporation, either directly or through the Company, or through
any such predecessor or successor corporation, or through any receiver or a trustee in
bankruptcy, whether by virtue of any constitution, statute or rule of law or by the
enforcement of any assessment or penalty or otherwise, all such liability being, by the
acceptance hereof and as a part of the consideration for the issue hereof, expressly
waived and released, as more fully provided in the Indenture. 

(End of text of bond) 

(Form of Prepayment
Record) 

PREPAYMENT RECORD 

PRINCIPAL AMOUNT OF BOND
$__________________ 

DATE OF MATURITY:
DECEMBER 1, 2036 

	Prepayments on Principal
	
	Amount
	Date
	Balance Outstanding
	Signature of Authorized 
Officer
and Title

	 	 	 	 

19

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