S-3

As filed with the Securities and Exchange Commission on January 17, 2006

Registration Statement No. 333-          

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM S-3

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

ORMAT TECHNOLOGIES, INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware (State or Other Jurisdiction of Incorporation or Organization)				88-0326081 (IRS Employer Identification No.)
980 Greg Street Sparks, Nevada 89431 (775) 356-9029 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)
______________________
Connie Stechman Vice President Ormat Technologies, Inc. 980 Greg Street Sparks, Nevada 89431 (775) 356-9029 (Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service)
______________________
Copies to:
Philip L. Colbran, Esq. Chadbourne & Parke LLP 30 Rockefeller Plaza New York, New York 10112 (212) 408-5100				Noam Ayali, Esq. Chadbourne & Parke LLP 1200 New Hampshire Avenue, N.W. Washington, District of Columbia 20036 (202) 974-5600

Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this Registration Statement.

If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box.

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.

If this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box.

If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box.

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered				Amount to be Registered(5)(6)(7)				Proposed Maximum Aggregate Offering Price(3)(5)(6)(7)(8)				Amount of Registration Fee(9)
Senior Debt Securities of Ormat Technologies, Inc.				(1)(2)(3)
Subordinated Debt Securities of Ormat Technologies, Inc.				(1)(2)(3)
Common Stock, par value $0.001 per share, of Ormat Technologies, Inc. (including the associated preferred share purchase right) (4)				(1)(2)(3)(10)
Warrants of Ormat Technologies, Inc.				(1)
Units of Ormat Technologies, Inc.				(1)
Total								$1,000,000,000				$107,000

(1)

There are being registered hereunder such indeterminate number, principal amount or liquidation amount of senior debt securities, subordinated debt securities, common stock, warrants and units of Ormat Technologies, Inc., as may from time to time be issued at indeterminate prices. The securities registered hereunder will not have an aggregate offering price which exceeds $1,000,000,000 or the equivalent in any other currency, currency unit or units, or composite currency or currencies. Any securities registered hereunder may be sold separately or as units with other securities registered hereunder.

(2)	Also includes such indeterminate number of senior debt securities, subordinated debt securities and common stock, as may be issued upon conversion or exchange of any senior debt securities or subordinated debt securities that provide for conversion or exchange into other securities for such securities or upon exercise of warrants for such securities.

(3)	No separate consideration will be received for the senior debt securities, subordinated debt securities or common stock issuable upon conversion of or in exchange for senior debt securities or subordinated debt securities.

(4)

Each share of common stock includes a right to purchase shares of a participating series of Series A Junior Participating Preferred Stock. The rights are attached to and trade with the common stock. Prior to the occurrence of certain events, none of which have occurred as of the date hereof, the rights will not be exercisable or evidenced separately from the common stock. The value attributable to the rights, if any, is reflected in the market price of the common stock.

(5)	In United States dollars or the equivalent thereof in any other currency, currency unit or units, or composite currency or currencies.

(6)

Such amount represents the principal amount of any senior debt securities or subordinated debt securities issued at their principal amount, the issue price rather than the principal amount of any senior debt securities or subordinated debt securities issued at an original issue discount, and the amount computed pursuant to Rule 457(c) for any shares of our common stock, the issue price of any warrants and the exercise price of any securities issuable upon exercise of warrants.

(7)	Information as to each class of securities to be registered is not specified in accordance with General Instruction II.D to Form S-3 under the Securities Act of 1933.

(8)	Exclusive of accrued interest and distributions, if any.

(9)

Estimated solely for the purpose of computing the registration fee. Calculated pursuant to Rule 457(o) of the rules and regulations under the Securities Act. Rule 457(o) permits the registration statement fee to be calculated on the basis of the maximum offering price of all of the securities listed above, and, therefore, the table does not specify by each class of security information as to the amount to be registered or the proposed maximum offering price per security.

(10)	Such indeterminate number of shares of common stock as may be issued upon exercise, conversion or exchange of any senior debt securities, subordinated debt securities or warrants that provide for such exercise, conversion or exchange are being registered hereby including as a result of anti-dilution provisions.

The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

The information contained herein is not complete and may be changed. We will not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION. DATED JANUARY 17, 2006

$1,000,000,000

Ormat Technologies, Inc.

Senior Debt Securities

Subordinated Debt Securities

Common Stock

Warrants and

Units

The securities listed above, or any combinations thereof, are the securities that Ormat Technologies, Inc. may issue under this prospectus. At the time of each offering, we will provide you with more specific terms of these securities in supplements to this prospectus. You should read this prospectus and the applicable prospectus supplement carefully before you invest.

We may offer these securities, or any combination thereof, from time to time in amounts, at prices and on other terms to be determined at the time of the offering. The total offering price of the securities offered to the public will be limited to $1,000,000,000. We may sell these securities to or through one or more underwriters, dealers and agents, or directly to purchasers, on a continuous or delayed basis.

Ormat Technologies, Inc.’s common stock is quoted on the New York Stock Exchange under the symbol ‘‘ORA’’. As of January 13, 2006, the closing price of Ormat Technologies, Inc.’s common stock, quoted on the New York Stock Exchange, was $31.96. None of the other securities are currently publicly traded. If we decide to seek the listing of any such securities upon issuance, the prospectus supplement relating to those securities will disclose the exchange, quotation system or market on which the securities will be listed.

Investing in our securities involves risk. You should read the risk factors beginning on page 7 of this prospectus and in other documents incorporated by reference in this prospectus before you invest.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.

Prospectus dated                 , 2006

TABLE OF CONTENTS

About This Prospectus				2
Note Regarding Forward-Looking Statements				3
Where You Can Find More Information				4
Ormat Technologies, Inc.				5
Ratios of Earnings to Fixed Charges				5
Use of Proceeds				6
Risk Factors				7
Description of Debt Securities We May Offer				24
Description of Common Stock We May Offer				38
Description of Warrants We May Offer				43
Description of Units We May Offer				46
Plan of Distribution				46
Validity of Securities				48
Experts				48

 ABOUT THIS PROSPECTUS 

This prospectus is part of a registration statement that we filed with the United States Securities and Exchange Commission, which we refer to as the ‘‘SEC’’, utilizing a shelf registration or continuous offering process. Under this shelf registration or continuous offering process, we may sell any combination of the securities described in this prospectus in one or more offerings up to a total amount of $1,000,000,000 or the equivalent thereof in one or more foreign currencies, including currency units or composite currencies.

This prospectus provides a general description of the securities that we may offer. Each time we sell securities, we will provide you with a prospectus supplement containing specific information about the terms of the securities being offered. A prospectus supplement may include a discussion of any risk factors in addition to those included herein under the heading ‘‘Risk Factors’’ or other special considerations applicable to those securities or to us. A prospectus supplement may also add, update or change information in this prospectus. If there is any inconsistency between the information in this prospectus and the applicable prospectus supplement, you must rely on the information in the prospectus supplement. You should read both this prospectus and any prospectus supplement together with additional information described under the heading ‘‘Where You Can Find More Information’’.

The registration statement containing this prospectus, including exhibits to the registration statement, provides additional information about us and the securities offered under this prospectus. The registration statement can be read at the SEC’s website or at the SEC’s public reference room mentioned under the heading ‘‘Where You Can Find More Information’’.

We may sell securities to underwriters who will sell the securities to the public on terms fixed at the time of sale. In addition, the securities may be sold by us directly to purchasers or through dealers or agents designated from time to time. If we, directly or through agents, solicit offers to purchase the securities, we reserve the sole right to accept and, together with any agents, to reject, in whole or in part, any of those offers.

Any prospectus supplement will contain the names of the underwriters, dealers or agents, if any, together with the terms of offering, the compensation of those underwriters and the net proceeds to us. Any underwriters, dealers or agents participating in the offering may be deemed ‘‘underwriters’’ within the meaning of the United States Securities Act of 1933, as amended, which we refer to as the ‘‘Securities Act’’.

All references in this prospectus to ‘‘Ormat’’, ‘‘the Company’’, ‘‘we’’, ‘‘us’’, ‘‘our Company", or ‘‘our’’ refer to Ormat Technologies, Inc. and its consolidated subsidiaries, except where it is clear that such terms refer to Ormat Technologies, Inc. only. ‘‘Ormat Industries’’ refers to Ormat Industries Ltd., the parent company of Ormat Technologies, Inc.

Unless otherwise stated, currency amounts in this prospectus and any prospectus supplement are stated in United States dollars (‘‘$’’).

When you acquire any securities discussed in this prospectus, you should rely only on the information provided in this prospectus and in the applicable prospectus supplement, including the information incorporated by reference. Reference to a prospectus supplement means the prospectus supplement describing the specific terms of the securities you purchase. The terms used in your prospectus supplement will have the meanings described in this prospectus, unless otherwise specified. No one is authorized to provide you with different information. We are not offering the securities in any jurisdiction where the offer is prohibited. You should not assume that the information in this prospectus, any prospectus supplement, or any document incorporated by reference, is truthful or complete at any date other than the date mentioned on the cover page of these documents.

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 NOTE REGARDING FORWARD-LOOKING STATEMENTS 

This prospectus contains certain forward-looking statements within the meaning of Section 27A of the Securities Act, and Section 21E of the Exchange Act. Forward-looking statements are statements other than historical information or statements of current condition and are based upon our current expectations and projections about future events. When used in this prospectus, the words ‘‘believe’’, ‘‘anticipate’’, ‘‘intend’’, ‘‘estimate’’, ‘‘expect’’, ‘‘will’’, ‘‘should’’, ‘‘may’’ and similar expressions, or the negative of such words and expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such words or expressions. These forward-looking statements generally relate to our plans, objectives and expectations for future operations and are based upon management’s current estimates and projections of future results or trends. Although we believe that our plans and objectives reflected in or suggested by these forward-looking statements are reasonable, we may not achieve these plans or objectives. You should read this prospectus completely and with the understanding that actual future results may be materially different from what we expect. We will not update forward-looking statements even though our situation may change in the future.

Specific factors that might cause actual results to differ from our expectations include, but are not limited to:

	•	significant considerations and risks discussed in this prospectus;

	•	operating risks, including equipment failures and the amounts and timing of revenues and expenses;

	•	geothermal resource risk (such as the heat content of the reservoir, useful life and geological formation);

	•	environmental constraints on operations and environmental liabilities arising from past or present operations, including the risk that we may not have, and in the future may be unable to procure, any necessary permits or other environmental authorizations;

	•	project delays or cancellations;

	•	reduction in revenues under our power purchase agreements with Southern California Edison Company as a result of a decline in the levels of short run avoided cost prices paid by Southern California Edison Company.

	•	financial market conditions and the results of financing efforts;

	•	political, legal, regulatory, governmental, administrative and economic conditions and developments in the United States and other countries in which we operate;

	•	the enforceability of the long-term power purchase agreements for our projects;

	•	contract counterparty risk;

	•	weather and other natural phenomena;

	•	impact of recent and future federal and state regulatory proceedings and changes, including legislative and regulatory initiatives regarding deregulation and restructuring of the electric utility industry and incentives for the production of renewable energy, changes in environmental and other laws and regulations to which our Company is subject, as well as changes in the application of existing laws and regulations;

	•	current and future litigation;

	•	our ability to successfully identify, integrate and complete acquisitions;

	•	competition from other similar geothermal energy projects, including any such new geothermal energy projects developed in the future, and from alternative electricity producing technologies that may prevail at the time some of our power purchase agreements expire;

	•	the effect of and changes in economic conditions in the areas in which we operate;

	•	market or business conditions and fluctuations in demand for energy or capacity in the markets in which we operate;

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	•	the direct or indirect impact on our company’s business resulting from terrorist incidents or responses to such incidents, including the effect on the availability of and premiums on insurance; and

	•	the effect of and changes in current and future land use and zoning regulations, residential, commercial and industrial development and urbanization in the area in which we operate.

 WHERE YOU CAN FIND MORE INFORMATION 

We file annual, quarterly and special reports, proxy statements and other information with the SEC. Our SEC filings are available to the public over the Internet at the SEC’s web site at http://www.sec.gov. You may also read and copy any document we file at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room.

The SEC allows us to incorporate by reference the information we file with them, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is an important part of this prospectus, and information that we file later with the SEC will automatically update and supersede this information. We incorporate by reference the documents listed below and filings that we will make after the date of filing the registration statement, which contains this prospectus, and prior to the effectiveness of such registration statement, and any future filings made by us with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the United States Securities Exchange Act of 1934, as amended, which we refer to as the ‘‘Exchange Act’’, until we sell all of the securities that we have registered:

	•	The Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2004, filed with the SEC on March 28, 2005, as amended by the Form 10-K/A filed with the SEC on April 12, 2005;

	•	The Company's Quarterly Reports on Form 10-Q, for the quarterly period ended March 31, 2005, filed with the SEC on May 13, 2005; for the quarterly period ended June 30, 2005, filed with the SEC on August 12, 2005, as amended by the Form 10-Q/A filed with the SEC on December 22, 2005; for the quarterly period ended September 30, 2005, filed with the SEC on November 14, 2005, as amended by the Form 10-Q/A filed with the SEC on December 22, 2005;

	•	The Company's Current Reports on Form 8-K filed with the SEC on February 2, 2005, February 15, 2005, March 10, 2005, April 8, 2005, May 20, 2005, October 3, 2005, October 31, 2005, December 13, 2005 and December 21, 2005; and

	•	The description of the Company’s common stock, par value $0.001 per share, and our preferred share purchase rights, under ‘‘Description of Capital Stock’’ in the Company’s Registration Statement on Form S-1 (File No. 333-177527) filed with the SEC on November 5, 2004, including all amendments and reports filed for the purpose of updating such description.

Our Internet address is http://www.ormat.com. We make available free of charge, through the investor relations section of our website, annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission. You may also request a copy of these filings at no cost, by writing or telephoning us at the following address: Ormat Technologies, Inc., 980 Greg Street, Sparks, Nevada 89431, (775) 356-9029, Attn: Connie Stechman. The website address in this prospectus relating to Ormat is included for your information as an inactive textual reference only, and none of the content of our website is incorporated by reference into this prospectus.

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ORMAT TECHNOLOGIES, INC.

Our Business

We are a leading vertically integrated company engaged in the geothermal and recovered energy power business. We design, develop, build, own and operate clean, environmentally friendly geothermal power plants, and we also design, develop and build, and plan to own and operate, recovered energy-based power plants, in each case using equipment that we design and manufacture. We conduct our business activities in two business segments. In our Electricity Segment, we develop, build, own and operate geothermal power plants in the United States and other countries and sell the electricity they generate. In our Products Segment, we design, manufacture and sell equipment for geothermal and recovered energy-based electricity generation, remote power units and other power generating units and provide services relating to the engineering, procurement, construction, operation and maintenance of geothermal and recovered energy power plants.

All of the projects that we currently own or operate produce electricity from geothermal energy sources. Geothermal energy is a clean and generally sustainable form of energy derived from the natural heat of the earth. Unlike electricity produced by burning fossil fuels, electricity produced from geothermal energy sources is produced without emissions of certain pollutants such as nitrogen oxide, and with far lower emissions of other pollutants such as carbon dioxide. Therefore, electricity produced from geothermal energy sources contributes significantly less to local and regional incidences of acid rain, and global warming than energy produced by burning fossil fuels. Geothermal energy is also an attractive alternative to other sources of energy as part of a national diversification strategy to avoid dependence on any one energy source or politically sensitive supply sources.

In addition to our geothermal energy power generation business, we have developed and continue to develop products that produce electricity from recovered energy or so-called ‘‘waste heat.’’ Recovered energy or waste heat represents residual heat that is generated as a by-product of gas turbine-driven compressor stations and in a variety of industrial processes, such as cement manufacturing, and is not otherwise used for any purpose. Such residual heat, that would otherwise be wasted, is captured in the recovery process and is used by recovered energy power plants to generate electricity without burning additional fuel and without emissions.

Our Executive Office

Our principal executive office is located at 980 Greg Street, Sparks Nevada 89431. Our telephone number is (775) 356-9029.

 RATIOS OF EARNINGS TO FIXED CHARGES 

The following table sets forth our consolidated ratio of earnings to fixed charges for the periods indicated:

				Nine Months Ended September 30, 2005				Year Ended December 31,
								2004				2003				2002				2001				2000
Ratio of earnings to fixed charges				1.79				1.56				3.07				3.33				1.15				3.07

For purposes of this calculation, ‘‘earnings’’ refers to the sum of (1) pre-tax income from continuing operations, (2) fixed charges, (3) distributed income of equity investees; less interest capitalized.

‘‘Fixed charges’’ means the sum of (1) interest expensed and capitalized, (2) amortized premiums, discounts and capitalized expenses related to indebtedness and (3) an estimate of the interest within rental expense.

As of the date of this prospectus, we have no preferred shares outstanding, and consequently, our ratio of earnings to preferred share dividends and our ratio of earnings to fixed charges would be identical.

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 USE OF PROCEEDS 

Unless otherwise indicated in an accompanying prospectus supplement, the net proceeds from the sale of the securities described in this prospectus will be added to our general funds and will be used for our general corporate purposes and those of our consolidated subsidiaries, which may include financing possible acquisitions and repurchases of our common stock.

From time to time, we may engage in additional public or private financings of a character and amount which we may deem appropriate.

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RISK FACTORS

Investing in our securities involves risk. Before making an investment decision, you should carefully consider the risks and other information we include or incorporate by reference in this prospectus. The risks and uncertainties we describe are not the only ones facing our Company. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also affect our business operations. Additional risk factors may be included in a prospectus supplement relating to a particular series or offering of securities.

Risks Related to Our Business

Our financial performance depends on the successful operation of our geothermal power plants, which is subject to various operational risks.

Our financial performance depends on the successful operation of our subsidiaries’ geothermal power plants. We derived approximately 72.4% and 74.9% of our total revenues for the year ended December 31, 2004 and the nine months ended September 30, 2005, respectively, from the sale of electricity. The cost of operation and maintenance and the operating performance of our subsidiaries’ geothermal power plants may be adversely affected by a variety of factors, including some that are discussed elsewhere in these risk factors and the following:

	•	regular and unexpected maintenance and replacement expenditures;

	•	shutdowns due to the breakdown or failure of our equipment or the equipment of the transmission serving utility;

	•	labor disputes;

	•	the presence of hazardous materials on our project sites; and

	•	catastrophic events such as fires, explosions, earthquakes, landslides, floods, releases of hazardous materials, severe storms or similar occurrences affecting our projects or any of the power purchasers or other third parties providing services to our projects.

Any of these events could significantly increase the expenses incurred by our projects or reduce the overall generating capacity of our projects and could significantly reduce or entirely eliminate the revenues generated by one or more of our projects, which in turn would reduce our net income and could materially and adversely affect our business, financial condition, future results and cash flow.

Our exploration, development, and operation of geothermal energy resources is subject to geological risks and uncertainties, which may result in decreased performance or increased costs for our projects.

Our business involves the exploration, development and operation of geothermal energy resources. These activities are subject to uncertainties, which vary among different geothermal reservoirs and are in some respects similar to those typically associated with oil and gas exploration, development and exploitation, such as dry holes, uncontrolled releases and pressure and temperature decline, all of which can increase our operating costs and capital expenditures or reduce the efficiency of our power plants. Prior to our acquisition of the Steamboat Hills project, one of the wells related to the project experienced an uncontrolled release. In addition, the high temperature and high pressure in the Puna project’s geothermal resource requires special reservoir management and monitoring. Further, since the commencement of their operations, several of our projects have experienced geothermal resource cooling in the normal course of operations. Because geothermal reservoirs are complex geological structures, we can only estimate their geographic area and sustainable output. The viability of geothermal projects depends on different factors directly related to the geothermal resource, such as the heat content (the relevant composition of temperature and pressure) of the geothermal reservoir, the useful life (commercially exploitable life) of the reservoir and operational factors relating to the extraction of geothermal fluids. Our geothermal energy projects may suffer an unexpected decline in the capacity of their respective geothermal wells and are exposed to a risk of geothermal reservoirs not being sufficient for sustained generation of the electrical power capacity desired over time. In addition, we may fail to find commercially viable geothermal resources in the expected quantities and temperatures, which would adversely affect our development of geothermal power projects.

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Another aspect of geothermal operations is the management and stabilization of subsurface impacts caused by fluid injection pressures. In the case of the geothermal resource supplying the Heber 1 project and the Heber 2 project, which we refer to collectively as the ‘‘Heber projects’’, and the Gould project (a new power plant at the site of the Heber projects consisting of two Ormat Energy Converters), pressure drawdown in the center of the well field has caused some localized ground subsidence, while pressure in the peripheral areas has caused localized ground inflation. Inflation and subsidence, if not controlled, can adversely affect farming operations and other infrastructure at or near the land surface. Potential costs, which cannot be estimated and may be significant, of failing to stabilize site pressures in the Heber and Gould projects’ area include repair and modification of gravity-based farm irrigation systems and municipal sewer piping and possible repair or replacement of a local road bridge spanning an irrigation canal.

Additionally, geothermally active areas, such as the areas in which our projects are located, are subject to frequent low-level seismic disturbances. Serious seismic disturbances are possible and could result in damage to our projects or equipment or degrade the quality of our geothermal resources to such an extent that we could not perform under the power purchase agreement for the affected project, which in turn could reduce our net income and materially and adversely affect our business, financial condition, future results and cash flow. If we suffer a serious seismic disturbance, our business interruption and property damage insurance may not be adequate to cover all losses sustained as a result thereof. In addition, insurance coverage may not continue to be available in the future in amounts adequate to insure against such seismic disturbances.

Our business development activities may not be successful and our projects under construction may not commence operation as scheduled.

We are currently in the process of developing and constructing a number of new power plants. Our success in developing a particular project is contingent upon, among other things, negotiation of satisfactory engineering and construction agreements and power purchase agreements, receipt of required governmental permits, obtaining adequate financing, and the timely implementation and satisfactory completion of construction. We may be unsuccessful in accomplishing any of these matters or doing so on a timely basis. Although we may attempt to minimize the financial risks attributable to the development of a project by securing a favorable power purchase agreement, obtaining all required governmental permits and approvals and arranging adequate financing prior to the commencement of construction, the development of a power project may require us to incur significant expenses for preliminary engineering, permitting and legal and other expenses before we can determine whether a project is feasible, economically attractive or capable of being financed.

Currently, we have power plants under development or construction in the United States, Kenya, Guatemala and China, and we intend to pursue the expansion of some of our existing plants and the development of other new plants. Our completion of these facilities is subject to substantial risks, including:

	•	unanticipated cost increases;

	•	shortages and inconsistent qualities of equipment, material and labor;

	•	work stoppages;

	•	inability to obtain permits and other regulatory matters;

	•	failure by key contractors and vendors to timely and properly perform;

	•	adverse environmental and geological conditions (including inclement weather conditions); and

	•	our attention to other projects;

any one of which could give rise to delays, cost overruns, the termination of the plant expansion, construction or development or the loss (total or partial) of our interest in the project under development, construction or expansion. Currently, we have not yet obtained a construction license for the Amatitlan project in Guatemala. In addition, we have not yet obtained certain permits and government approvals required for the completion and successful operation of the Gould project.

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We may be unable to obtain the financing we need to pursue our growth strategy and any future financing we receive may be less favorable to us than our current financing arrangements, either of which may adversely affect our ability to expand our operations.

Our geothermal power plants generally have been financed using leveraged financing structures, consisting of non-recourse or limited recourse debt obligations. As of December 31, 2004 and September 30, 2005, we had approximately $578.4 million and $538.0 million, respectively, of total consolidated indebtedness (including indebtedness to our parent company in the amount of $186.9 million and $193.9 million as of December 31, 2004 and September 30, 2005, respectively), of which approximately $357.2 million and $348.2 million, respectively, represented non-recourse debt and limited recourse debt held by our subsidiaries. Each of our projects under development or construction and those projects and businesses we may seek to acquire or construct will require substantial capital investment. Our continued access to capital with acceptable terms is necessary for the success of our growth strategy. Our attempts to obtain future financings may not be successful or on favorable terms.

Market conditions and other factors may not permit future project and acquisition financings on terms similar to those our subsidiaries have previously received. Our ability to arrange for financing on a substantially non-recourse or limited recourse basis, and the costs of such financing, are dependent on numerous factors, including general economic and capital market conditions, credit availability from banks, investor confidence, the continued success of current projects, the credit quality of the projects being financed, the political situation in the country where the project is located and the continued existence of tax and securities laws which are conducive to raising capital. If we are not able to obtain financing for our projects on a substantially non-recourse or limited recourse basis, we may have to finance them using recourse capital such as direct equity investments, parent company loans or the incurrence of additional debt by us.

Also, in the absence of favorable financing options, we may decide not to build new plants or acquire facilities from third parties. Any of these alternatives could have a material adverse effect on our growth prospects.

Our foreign projects expose us to risks related to the application of foreign laws, taxes, economic conditions, labor supply and relations, political conditions and policies of foreign governments, any of which risks may delay or reduce our ability to profit from such projects.

We have substantial operations outside of the United States that generated revenues in the amount of $82.1 million and $58.9 million for the year ended December 31, 2004 and the nine months ended September 30, 2005, respectively, which represented 37.4% and 32.9% of our total revenues for such periods, respectively. Our foreign operations are subject to regulation by various foreign governments and regulatory authorities and are subject to the application of foreign laws. Such foreign laws or regulations may not provide for the same type of legal certainty and rights, in connection with our contractual relationships in such countries, as are afforded to our projects in the United States, which may adversely affect our ability to receive revenues or enforce our rights in connection with our foreign operations. Furthermore, existing laws or regulations may be amended or repealed, and new laws or regulations may be enacted or issued. In addition, the laws and regulations of some countries may limit our ability to hold a majority interest in some of the projects that we may develop or acquire, thus limiting our ability to control the development, construction and operation of such projects. Our foreign operations are also subject to significant political, economic and financial risks, which vary by country, and include:

	•	changes in government policies or personnel;

	•	changes in general economic conditions;

	•	restrictions on currency transfer or convertibility;

	•	changes in labor relations;

	•	political instability and civil unrest;

	•	changes in the local electricity market;

	•	breach or repudiation of important contractual undertakings by governmental entities; and

	•	expropriation and confiscation of assets and facilities.

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In particular, the Philippines is in the midst of an ongoing privatization of the electric industry, and in Guatemala the electricity sector was partially privatized, and it is currently unclear whether further privatization will occur in the future. Such developments may affect our existing Leyte and Zunil projects and the Amatitlan project (Leyte in the Phillipines and Zunil and Amatitlan in Guatemala) currently under construction if, for example, they result in changes to the prevailing tariff regime or in the identity and creditworthiness of our power purchasers. In Nicaragua, Union Fenosa, one of the electric utilities, has been experiencing difficulties adjusting the tariffs charged to its customers, thus affecting Union Fenosa’s ability to pay for electricity its purchases from power generators. This may adversely affect our Momotombo project in Nicaragua. In Kenya, the government is continuing to make an effort to deliver on campaign promises to reduce the price of electricity and is applying pressure on independent power producers, such as our Olkaria III project, to lower their tariffs. In addition, Kenya’s government is considering a further restructuring and privatization of the electricity industry and may divide Kenya Power & Lighting Co. Ltd., the power purchaser for our Olkaria III project, into separate entities and then privatize one or more of such resulting entities. A material tariff reduction or any break-up and potential privatization of Kenya Power & Lighting Co. Ltd. may adversely affect our Olkaria III project. We have recently held discussions with the Kenyan government and Kenya Power & Lighting Co. Ltd. regarding, among other things, the construction of Phase II of the Olkaria III project in Kenya. Upon implementation, we expect Phase II to add approximately 35 MW in generating capacity to the current Olkaria III project. Under existing documentation for the Olkaria III project, our subsidiary was required to construct Phase II and to reach commercial operations by May 31, 2007, in order to avoid financial penalties, or by April 17, 2008, at the latest, to avoid termination of the entire power purchase agreement. Discussions are currently underway with Kenyan parties regarding the possible entry of a publicly held Kenyan corporation as a minority equity investor in the Olkaria III project, possible reduction of the tariff payable under the power purchase agreement and related issues. In connection with such discussions, Kenya Power and Lighting Co. Ltd has provided an approximate 105 day extension of the project’s Phase II schedule.

Although we generally obtain political risk insurance in connection with our foreign projects, such political risk insurance does not mitigate all of the above-mentioned risks. In addition, insurance proceeds received pursuant to our political risk insurance policies, where applicable, may not be adequate to cover all losses sustained as a result of any covered risks and may at times be pledged in favor of the project lenders as collateral. Also, insurance may not be available in the future with the scope of coverage and in amounts of coverage adequate to insure against such risks and disturbances.

Our foreign projects and foreign manufacturing operations expose us to risks related to fluctuations in currency rates, which may reduce our profits from such projects and operations.

Risks attributable to fluctuations in currency exchange rates can arise when any of our foreign subsidiaries borrow funds or incur operating or other expenses in one type of currency but receive revenues in another. In such cases, an adverse change in exchange rates can reduce such subsidiary’s ability to meet its debt service obligations, reduce the amount of cash and income we receive from such foreign subsidiary or increase such subsidiary’s overall expenses. In addition, the imposition by foreign governments of restrictions on the transfer of foreign currency abroad, or restrictions on the conversion of local currency into foreign currency, would have an adverse effect on the operations of our foreign projects and foreign manufacturing operations, and may limit or diminish the amount of cash and income that we receive from such foreign projects and operations.

A significant portion of our net revenue is attributed to payments made by power purchasers under power purchase agreements. The failure of any such power purchaser to perform its obligations under the relevant power purchase agreement or the loss of a power purchase agreement due to a default would reduce our net income and could materially and adversely affect our business, financial condition, future results and cash flow.

A significant portion of our net revenue is attributed to revenues derived from power purchasers under the relevant power purchase agreements. Southern California Edison Company, Hawaii Electric Light Company, and Sierra Pacific Power Company have accounted for 41.4%, 7.1% and 12.9%,

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respectively, of our revenues for the year ended December 31, 2004 and 38.1%, 14.4% and 13.3%, respectively, for the nine months ended September 30, 2005. Neither we nor any of our affiliates make any representations as to the financial condition or creditworthiness of any purchaser under a power purchase agreement, and nothing in this prospectus should be construed as such a representation.

There is a risk that any one or more of the power purchasers may not fulfill their respective payment obligations under their power purchase agreements. For example, as a result of the energy crisis in California, Southern California Edison Company withheld payments it owed under various of its power purchase agreements with a number of power generators (such as the Ormesa, Heber, and Mammoth projects) payable for certain energy delivered between November 2000 and March 2001 under such power purchase agreements until March 2002. If any of the power purchasers fails to meet its payment obligations under its power purchase agreements, it could materially and adversely affect our business, financial condition, future results and cash flow.

In connection with the power purchase agreements for the Ormesa project, Southern California Edison Company challenged the contract rate for the power supplied by the GEM 2 and GEM 3 plants to the Ormesa project for auxiliary purposes. Southern California Edison Company contends that California ISO real-time prices should apply instead of the contract rate. Management believes that the contract rate should apply and that, even if Southern California Edison Company is correct that the contract rate should not apply, SP-15 prices quoted by NYMEX (which are higher than California ISO real-time prices) should apply. According to Southern California Edison Company’s estimation, the amount under dispute is approximately $2.5 million. The parties have signed an Interim Agreement, whereby Southern California Edison Company will procure the GEM power at 5.37 Cents/kWh until May 1, 2007. In addition, we expect a long-term power purchase agreement will be entered into for the GEM power for post 2007. The power rate under the long-term power purchase agreement will provide Southern California Edison Company the full satisfaction of any past or present claims. The negotiations of the long-term power purchase agreement are still under way and there is no guarantee that it will be successfully completed.

Seasonal variations may cause significant fluctuations in our cash flows, which may cause the market price of our common stock to fall in certain periods.

Our results of operations are subject to seasonal variations. This is primarily because some of our domestic projects receive higher capacity payments under the relevant power purchase agreements during the summer months, and due to the generally higher short run avoided costs in effect during the summer months. Some of our other projects may experience reduced generation during warm periods due to the lower heat differential between the geothermal fluid and the ambient surroundings. Such seasonal variations could materially and adversely affect our business, financial condition, future results and cash flow. If our operating results fall below the public’s or analysts’ expectations in some future period or periods, the market price of our common stock will likely fall in such period or periods.

Pursuant to the terms of some of our power purchase agreements with investor-owned electric utilities in states that have renewable portfolio standards, the failure to supply the contracted capacity and energy thereunder may result in the imposition of penalties.

Under the Burdette (formerly Galena), Desert Peak 2, Gould and Galena 2 power purchase agreements, we may be required to make payments to the relevant power purchaser in an amount equal to such purchaser’s replacement costs for renewable energy relating to any shortfall amount of renewable energy that we do not provide as required under the power purchase agreement and which such power purchaser is forced to obtain from an alternate source. These four power purchase agreements are expected to phase-in and commence generating revenues in 2006. When all four are generating revenues, measured against our revenues from the sale of electricity for the nine months ended September 30, 2005 and assuming no other changes in our revenues, the revenues from such agreements will constitute, collectively, less than 12% of our total revenues from the sale of electricity. In addition, we may be required to make payments to the relevant power purchaser in an amount equal to its replacement costs relating to any renewable energy credits we do not provide as required under the relevant power purchase agreement. We may be subject to certain penalties, and we may

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also be required to pay liquidated damages, if certain minimum performance requirements are not met under certain of our power purchase agreements, all of which could materially and adversely affect our business, financial condition, future results and cash flow. With respect to certain of our power purchase agreements, we may also be required to pay liquidated damages to our power purchaser if the relevant project does not maintain availability of at least 85% during applicable peak periods. The maximum aggregate amount of such liquidated damages for the Steamboat 2 and Steamboat 3 power purchase agreements would be approximately $1.5 million for each project.

The short run avoided costs for our power purchasers may decline, which would reduce our project revenues and could materially and adversely affect our business, financial condition, future results and cash flow.

Under the power purchase agreements for our projects in California, the price that Southern California Edison Company pays for energy is based upon its short run avoided costs, which are the incremental costs that it would have incurred had it generated the relevant electrical energy itself or purchased such energy from others. Under settlement agreements between Southern California Edison Company and a number of power generators in California that are ‘‘Qualifying Facilities’’ pursuant to the Public Utility Regulatory Policies Act of 1978, as amended, which we refer to as ‘‘Qualifying Facilities’’, including our subsidiaries, the energy price component payable by Southern California Edison Company has been fixed through April 2007, and thereafter will be based on Southern California Edison Company’s short run avoided costs, as determined by the California Public Utilities Commission, which we refer to as "CPUC." These short run avoided costs are made available by Southern California Edison Company to the public and may vary substantially on a monthly basis, based primarily on natural gas prices and other factors. The levels of short run avoided cost prices paid by Southern California Edison Company may decline following the expiration date of the settlement agreements, which in turn would reduce our project revenues derived from Southern California Edison Company under our power purchase agreements with it and could materially and adversely affect our business, financial condition, future results and cash flow.

In response to an order issued by a California State Court of Appeals, the CPUC has commenced an administrative proceeding in order to address short run avoided cost pricing for Qualifying Facilities for the period spanning from December 2000 to March 2001. The court directed the CPUC to modify short run avoided cost pricing on a retroactive basis to the extent that the CPUC determined that short run avoided cost prices were not sufficiently ‘‘accurate’’ or ‘‘correct’’. On February 15, 2005 the CPUC issued a draft decision affirming that short run avoided cost prices during the disputed period were correct and in compliance with PURPA requirements and that no retroactive adjustments are warranted. That draft decision was challenged by the parties. The CPUC determined that additional information was necessary to resolve the matter and the draft decision was withdrawn. The parties were given time to submit additional information and a decision from the CPUC has not yet been rendered. If the short run avoided cost prices charged during the period in question were determined by the CPUC not to be ‘‘accurate’’ or ‘‘correct,’’ retroactive price adjustments could be required for any of our Qualifying Facilities in California whose payments are tied to short run avoided cost pricing, including the Heber, Mammoth and Ormesa projects. Currently, it is not possible to predict the outcome of such proceedings; however, any retroactive price adjustment required to be made in relation to any of our projects may require such projects to make refund payments or charge less for future sales, which could materially and adversely affect our business, financial condition, future results and cash flow.

If any of our domestic projects loses its Qualifying Facility status under PURPA, or if amendments to PURPA are enacted that substantially reduce the benefits currently afforded to Qualifying Facilities, our domestic operations could be adversely affected.

Most of our domestic projects are Qualifying Facilities pursuant to the Public Utility Regulatory Policies Act of 1978, as amended, which we refer to as "PURPA," which largely exempts the projects from the Federal Power Act, which we refer to "FPA," the Public Utility Holding Company Act of 1935, as amended, which we refer to as "PUHCA," and certain state and local laws and regulations regarding rates and financial and organizational requirements for electric utilities.

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Until February 8, 2006, the effective date of the repeal of PUHCA (pursuant to the 2005 Energy Act), in the event that any of our domestic projects loses its Qualifying Facility status, such project and we could become subject to PUHCA, unless we file an application for status as an ‘‘Exempt Wholesale Generator’’ or ‘‘EWG’’ which would continue the PUHCA exemption until PUHCA is repealed. In addition, if any of the domestic projects were to lose its Qualifying Facility status, such project could also become subject to the full scope of the FPA and applicable state regulations. The application of PUHCA, FPA and other applicable state regulations to our domestic projects would require our operations to comply with an increasingly complex regulatory regime that may be costly and greatly reduce our operational flexibility.

In addition, pursuant to the FPA, the Federal Energy Regulatory Commission, which we refer to as "FERC," has exclusive rate-making jurisdiction over wholesale sales of electricity and transmission in interstate commerce. These rates may be based on a cost of service approach or may be determined on a market basis through competitive bidding or negotiation. Qualifying Facilities are generally exempt from the FPA. If a domestic project were to lose its Qualifying Facility status, it would become a public utility under the FPA, and the rates charged by such project pursuant to its power purchase agreements would be subject to the review and approval of the FERC. The FERC, upon such review, may determine that the rates currently set forth in such power purchase agreements are not appropriate and may set rates that are lower than the rates currently charged. In addition, the FERC may require that some or all of our domestic projects refund amounts previously paid by the relevant power purchaser to such project. Such events would likely result in a decrease in our future revenues or in an obligation to disgorge revenues previously received from our domestic projects, each of which would have an adverse effect on our revenues.

Moreover, a loss of Qualifying Facility status also could permit the power purchaser, pursuant to the terms of the particular power purchase agreement, to cease taking and paying for electricity from the relevant project or, consistent with FERC precedent, to seek refunds of past amounts paid. This could cause the loss of some or all of our revenues payable pursuant to the related power purchase agreement, result in significant liability for refunds of past amounts paid, or otherwise impair the value of our project. If a power purchaser were to cease taking and paying for electricity or seek to obtain refunds of past amounts paid, there can be no assurance that the costs incurred in connection with the project could be recovered through sales to other purchasers or that we would have sufficient funds to make such payments. In addition, the loss of Qualifying Facility status would be an event of default under the financing arrangements currently in place for some of our projects, which would enable the lenders to exercise their remedies and enforce the liens on the relevant project.

On October 11, 2005, FERC proposed regulations to implement the new PURPA requirements contained in the 2005 Energy Act. Under the proposed regulations, wholesale sales by Qualifying Facilities, which have been generally exempt from the FPA, would be subject to the FPA unless the power purchase agreement was approved pursuant to PURPA by the relevant state commission. It is not clear whether this provision will be included when the regulations are ultimately adopted. However, if adopted, such regulations may have an adverse impact on our operation.

A decision by the U.S. Court of Appeals to overturn a FERC decision relating to the use by a project of power generated from another Qualifying Facility for auxiliary purposes may adversely affect our operations and financial results.

According to a recent FERC decision regarding our Ormesa project, a geothermal Qualifying Facility that obtains electricity for the operation of its reinjection pumps from an electric utility must reduce its net capacity available for sale by an equivalent amount. However, the FERC decision held that if the electricity for reinjection pumping is provided by Qualifying Facilities that are cogeneration or small power production facilities, no reduction in net capacity is required. Since electricity for reinjection pumping is provided to the Ormesa project by this type of Qualifying Facility, no change in operations at the Ormesa project is required by the FERC decision. However, a petition for review of this aspect of the FERC’s decision has been filed before the U.S. Court of Appeals for the District of Columbia. If the Court of Appeals were to overturn the FERC’s recent decision regarding the use of electricity for reinjection pumping provided by the Qualifying Facilities that are cogeneration or small

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power production facilities, there could be an adverse effect on revenues received from power sales on the Ormesa facility, and thus, an adverse effect on our operations and financial results. Oral arguments in the case before the U.S. Court of Appeals for the District of Columbia were heard on December 6, 2005. A decision by the court may be issued within the next several months.

Our financial performance is significantly dependent on the successful operation of our projects, which is subject to changes in the legal and regulatory environment affecting our projects.

All of our projects are subject to extensive regulation and, therefore, changes in applicable laws or regulations, or interpretations of those laws and regulations, could result in increased compliance costs, the need for additional capital expenditures or the reduction of certain benefits currently available to our projects. The structure of federal and state energy regulation currently is, and may continue to be, subject to challenges, modifications, the imposition of additional regulatory requirements, and restructuring proposals. Our power purchasers or we may not be able to obtain all regulatory approvals that may be required in the future, or any necessary modifications to existing regulatory approvals, or maintain all required regulatory approvals. In addition, the cost of operation and maintenance and the operating performance of geothermal power plants may be adversely affected by changes in certain laws and regulations, including tax laws.

The federal government also encourages production of electricity from geothermal resources through certain tax subsidies. We are permitted to claim in our consolidated federal tax returns either an investment tax credit for approximately 10% of the cost of each new geothermal power plant or ‘‘production tax credits’’ of 1.9 cents a kilowatt hour on the first ten years of electricity output. (Production tax credits can only be claimed on new plants put into service between October 23, 2004 and December 31, 2007.) We are also permitted to deduct most of the cost of the power plant as ‘‘depreciation’’ over five years on an accelerated basis. The fact that the deductions are accelerated means that more of the cost is deducted in the first few years than during the remainder of the depreciation period. In addition, we have the ability to transfer the value of these tax incentives when we are not in a position to use them directly. For instance, energy credits can be transferred through lease financing, and production tax credits may be transferred by bringing in another company who can use them as a partner in the project.

President Bush has made it a central theme of his second term to simplify the U.S. tax code. Among the options that may be under consideration are replacing or supplementing the corporate income tax with a value-added-tax, stripping away many tax subsidies, and eliminating taxes on interest, dividends and other returns to capital. Significant tax reform has the potential to have a material effect on our business, financial condition, future results and cash flow. It could reduce or eliminate the value that geothermal companies receive from the current tax subsidies. Any restrictions or tightening of the rules for lease or partnership transactions—whether or not part of major tax reform—could also materially affect our business, financial condition, future results and cash flow.

Any such changes could significantly increase the regulatory-related compliance and other expenses incurred by the projects and could significantly reduce or entirely eliminate the revenues generated by one or more of the projects, which in turn would reduce our net income and could materially and adversely affect our business, financial condition, future results and cash flow.

The costs of compliance with environmental laws and of obtaining and maintaining environmental permits and governmental approvals, which currently are significant, may increase in the future and could materially and adversely affect our business, financial condition, future results and cash flow; any non-compliance with such laws or regulations may result in the imposition of liabilities which could materially and adversely affect our business, financial condition, future results and cash flow.

Our projects are required to comply with numerous domestic and foreign federal, regional, state and local statutory and regulatory environmental standards and to maintain numerous environmental permits and governmental approvals required for construction and/or operation. Some of the environmental permits and governmental approvals that have been issued to the projects contain conditions and restrictions, including restrictions or limits on emissions and discharges of pollutants and contaminants, or may have limited terms. If we fail to satisfy these conditions or comply with

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these restrictions, or with any statutory or regulatory environmental standards, we may become subject to regulatory enforcement action and the operation of the projects could be adversely affected or be subject to fines, penalties or additional costs. In addition, we may not be able to renew, maintain or obtain all environmental permits and governmental approvals required for the continued operation or further development of the projects. As of the date of this registration statement, we have not yet obtained certain permits and government approvals required for the completion and successful operation of the Gould project. In addition, a nearby municipality has informed our Amatitlan project that an additional building permit should be obtained from such municipality before construction commences. In what appears to be a related occurrence, a group of demonstrators from the municipality have attempted to disrupt the access road to our Amatitlan project. A separate group of demonstrators from another municipality have turned out in support of the project, and Guatemalan authorities have assisted in maintaining access to the project. Our failure to renew, maintain or obtain required permits or governmental approvals, including the permits and approvals necessary for operating the Gould project and the Amatitlan project, could cause our operations to be limited or suspended. Environmental laws, ordinances and regulations affecting us can be subject to change and such change could result in increased compliance costs, the need for additional capital expenditures, or otherwise adversely affect us.

We could be exposed to significant liability for violations of hazardous substances laws because of the use or presence of such substances at our projects.

Our projects are subject to numerous domestic and foreign federal, regional, state and local statutory and regulatory standards relating to the use, storage and disposal of hazardous substances. We use isobutene, isopentane, industrial lubricants and other substances at our projects which are or could become classified as hazardous substances. If any hazardous substances are found to have been released into the environment at or by the projects, we could become liable for the investigation and removal of those substances, regardless of their source and time of release. If we fail to comply with these laws, ordinances or regulations (or any change thereto), we could be subject to civil or criminal liability, the imposition of liens or fines, and large expenditures to bring the projects into compliance. Furthermore, in the United States, we can be held liable for the cleanup of releases of hazardous substances at other locations where we arranged for disposal of those substances, even if we did not cause the release at that location. The cost of any remediation activities in connection with a spill or other release of such substances could be significant.

We believe that at one time there may have been a gas station located on the Mammoth project site, but because of significant surface disturbance and construction since that time further physical evaluation of the former gas station site has been impractical. There may be soil or groundwater contamination and related potential liabilities of which we are unaware related to this site, which may be significant and may adversely and materially affect our operations and revenues.

We may not be able to successfully integrate companies which we may acquire in the future, which could materially and adversely affect our business, financial condition, future results and cash flow.

Our strategy is to continue to expand in the future, including through acquisitions. Integrating acquisitions is often costly, and we may not be able to successfully integrate our acquired companies with our existing operations without substantial costs, delays or other adverse operational or financial consequences. Integrating our acquired companies involves a number of risks that could materially and adversely affect our business, including:

	•	failure of the acquired companies to achieve the results we expect;

	•	inability to retain key personnel of the acquired companies;

	•	risks associated with unanticipated events or liabilities; and

	•	the difficulty of establishing and maintaining uniform standards, controls, procedures and policies, including accounting controls and procedures.

If any of our acquired companies suffers customer dissatisfaction or performance problems, the same could adversely affect the reputation of our group of companies and could materially and adversely affect our business, financial condition, future results and cash flow.

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The power generation industry is characterized by intense competition, and we encounter competition from electric utilities, other power producers, and power marketers that could materially and adversely affect our business, financial condition, future results and cash flow.

The power generation industry is characterized by intense competition from electric utilities, other power producers and power marketers. In recent years, there has been increasing competition in the sale of electricity, in part due to excess capacity in a number of U.S. markets and an emphasis on short-term or ‘‘spot’’ markets, and competition has contributed to a reduction in electricity prices. For the most part, we expect that power purchasers interested in long-term arrangements will engage in ‘‘competitive bid’’ solicitations to satisfy new capacity demands. This competition could adversely affect our ability to obtain power purchase agreements and the price paid for electricity by the relevant power purchasers. There is also increasing competition between electric utilities. This competition has put pressure on electric utilities to lower their costs, including the cost of purchased electricity, and increasing competition in the future will put further pressure on power purchasers to reduce the prices at which they purchase electricity from us.

The existence of a prolonged force majeure event or a forced outage affecting a project could reduce our net income and materially and adversely affect our business, financial condition, future results and cash flow.

The operation of our subsidiaries' geothermal power plants is subject to a variety of risks discussed elsewhere in these risk factors, including events such as fires, explosions, earthquakes, landslides, floods, severe storms or other similar events. For example, recently, due to hurricane activity, the access roads and the piping from the wells to the Zunil power plant were damaged and, as a result, the project has not been in operation since October 2005 and it will not be in operation until repair work is substantially completed, which we expect to occur in the second quarter of 2006.

If a project experiences an occurrence resulting in a force majeure event, our subsidiary owning that project would be excused from its obligations under the relevant power purchase agreement. However, the relevant power purchaser may not be required to make any capacity and/or energy payments with respect to the affected project or plant so long as the force majeure event continues and, pursuant to certain of our power purchase agreements, will have the right to prematurely terminate the power purchase agreement. Additionally, to the extent that a forced outage has occurred, the relevant power purchaser may not be required to make any capacity and/or energy payments to the affected project, and if as a result the project fails to attain certain performance requirements under certain of our power purchase agreements, the purchaser may have the right to permanently reduce the contract capacity (and, correspondingly, the amount of capacity payments due pursuant to such agreements in the future), seek refunds of certain past capacity payments, and/or prematurely terminate the power purchase agreement. As a consequence, we may not receive any net revenues from the affected project or plant other than the proceeds from any business interruption insurance that applies to the force majeure event or forced outage after the relevant waiting period, and may incur significant liabilities in respect of past amounts required to be refunded. Accordingly, our business, financial condition, future results and cash flows could be materially and adversely affected. Recently, due to hurricane activity, piping from the wells to the Zunil power plant was damaged and as a result, the Project has not been in operation since October 14, 2005.

The existence of a force majeure event or a forced outage affecting the transmission system of the Imperial Irrigation District could reduce our net income and materially and adversely affect our business, financial condition, future results and cash flow.

If the transmission system of the Imperial Irrigation District experiences a force majeure event or a forced outage which prevents it from transmitting the electricity from the Heber projects or the Ormesa project to the relevant power purchaser, the relevant power purchaser would not be required to make energy payments for such non-delivered electricity and may not be required to make any capacity payments with respect to the affected project so long as such force majeure event or forced outage continues. Our revenues for the year ended December 31, 2004 and for the nine months ended September 30, 2005, from the projects utilizing the Imperial Irrigation District transmission system,

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were approximately $90.8 million and $68.3 million, respectively. The impact of such force majeure would depend on the duration thereof, with longer outages resulting in greater revenue loss.

Some of our leases will terminate if we do not extract geothermal resources in ‘‘commercial quantities’’, thus requiring us to enter into new leases or secure rights to alternate geothermal resources, none of which may be available on terms as favorable to us as any such terminated lease, if at all.

Most of our geothermal resource leases are for a fixed primary term, and then continue for so long as geothermal resources are extracted in ‘‘commercial quantities’’ or pursuant to other terms of extension. The land covered by some of our leases is undeveloped and has not yet produced geothermal resources in ‘‘commercial quantities’’. Leases that cover land which remains undeveloped and does not produce, or does not continue to produce, geothermal resources in commercial quantities and leases that we allow to expire, will terminate. In the event that a lease is terminated and we determine that we will need that lease once the applicable project is operating, we would need to enter into one or more new leases with the owner(s) of the premises that are the subject of the terminated lease(s) in order to develop geothermal resources from, or inject geothermal resources into, such premises or secure rights to alternate geothermal resources or lands suitable for injection, all of which may not be possible or could result in increased cost to us, which could materially and adversely affect our business, financial condition, future results and cash flow.

Our Bureau of Land Management leases may be terminated if we fail to comply with any of the provisions of the Geothermal Steam Act of 1970 or if we fail to comply with the terms or stipulations of such leases, which may materially and adversely affect our business and operations.

Pursuant to the terms of our Bureau of Land Management (which we refer to as "BLM") leases, we are required to conduct our operations on BLM-leased land in a workmanlike manner and in accordance with all applicable laws and BLM directives and to take all mitigating actions required by the BLM to protect the surface of and the environment surrounding the relevant land. Additionally, certain BLM leases contain additional requirements, some of which relate to the mitigation or avoidance of disturbance of any antiquities, cultural values or threatened or endangered plants or animals, the payment of royalties for timber and the imposition of certain restrictions on residential development on the leased land. In the event of a default under any BLM lease, or the failure to comply with such requirements, or any non-compliance with any of the provisions of the Geothermal Steam Act of 1970 or regulations issued thereunder, the BLM may, 30 days after notice of default is provided to our relevant project subsidiary, suspend our operations until the requested action is taken or terminate the lease, either of which could materially and adversely affect our business, financial condition, future results and cash flow.

Some of our leases (or subleases) could terminate if the lessor (or sublessor) under any such lease (or sublease) defaults on any debt secured by the relevant property, thus terminating our rights to access the underlying geothermal resources at that location.

The fee interest in the land which is the subject of some of our leases (or subleases) may currently be or may become subject to encumbrances securing loans from third party lenders to the lessor (or sublessor). Our rights as lessee (or sublessee) under such leases (or subleases) are or may be subject and subordinate to the rights of any such lender. Accordingly, a default by the lessor (or sublessor) under any such loan could result in a foreclosure on the underlying fee interest in the property and thereby terminate our leasehold interest and result in the shutdown of the project located on the relevant property and/or terminate our right of access to the underlying geothermal resources required for our operations.

In addition, a default by a sublessor under its lease with the owner of the property that is the subject of our sublease could result in the termination of such lease and thereby terminate our sublease interest and our right to access the underlying geothermal resources required for our operations.

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Current and future urbanizing activities and related residential, commercial and industrial developments may encroach on or limit geothermal activities in the areas of our projects, thereby affecting our ability to utilize, access, inject and/or transport geothermal resources on or underneath the affected surface areas.

Current and future urbanizing activities and related residential, commercial and industrial development may encroach on or limit geothermal activities in the areas of our projects, thereby affecting our ability to utilize, access, inject and/or transport geothermal resources on or underneath the affected surface areas. In particular, the Heber projects and the Gould project rely on an area, which we refer to as the "Heber Known Geothermal Resource Area" or "Heber KGRA," for the geothermal resource necessary to generate electricity at the Heber projects and Gould project. Imperial County has adopted a ‘‘specific plan area’’ that covers the Heber KGRA, which we refer to as the "Heber Specific Plan Area." The Heber Specific Plan Area allows commercial, residential, industrial and other employment oriented development in a mixed-use orientation, which currently includes geothermal uses. Several of the landowners from whom we hold geothermal leases have expressed an interest in developing their land for residential, commercial, industrial or other surface uses in accordance with the parameters of the Heber Specific Plan Area. Currently, Imperial County's Heber Specific Plan Area is coordinated with the cities of El Centro and Calexio. There has been ongoing underlying interest since the early 1990s to incorporate the community of Heber. While any incorporation process would likely take several years, if Heber were to be incorporated, the City of Heber could replace Imperial County as the governing land use authority, which, depending on its policies, could have a significant effect on land use and availability of geothermal resources.

Current and future development proposals within Imperial County and the City of Calexico, applications for annexations to the City of Calexico, and plans to expand public infrastructure may affect surface areas within the Heber KGRA, thereby limiting our ability to utilize, access, inject and/or transport the geothermal resource on or underneath the affected surface area that is necessary for the operation of our Heber projects and Gould project, which could adversely affect our operations and reduce our revenues.

We depend on key personnel for the success of our business.

Our success is largely dependent on the skills, experience and efforts of our senior management team and other key personnel. In particular, our success depends on the continued efforts of Lucien Bronicki, Dita Bronicki, Hezy Ram, Nadav Amir, Yoram Bronicki and other key employees. The loss of the services of any key employee could materially harm our business, financial condition, future results and cash flow. Although to date we have been successful in retaining the services of senior management and have entered into employment agreements with Lucien Bronicki, Dita Bronicki, Hezy Ram and Yoram Bronicki, such members of our senior management may terminate their employment agreements without cause and with notice periods ranging from 90 to 180 days. We may also not be able to locate or employ on acceptable terms qualified replacements for our senior management or key employees if their services were no longer available.

Our projects have generally been financed through a combination of parent company loans and limited- or non-recourse project finance debt and lease financing. If our project subsidiaries default on their obligations under such limited- or non-recourse debt or lease financing, we may be required to make certain payments to the relevant debt holders and if the collateral supporting such leveraged financing structures is foreclosed upon, we may lose certain of our projects.

Our projects have generally been financed using a combination of parent company loans and limited or non-recourse project finance debt or lease financing. Non-recourse project finance debt or lease financing refers to financing arrangements that are repaid solely from the project’s revenues and are secured by the project’s physical assets, major contracts, cash accounts and, in many cases, our ownership interest in the project subsidiary. Limited-recourse project finance debt refers to our additional agreement, as part of the financing of a project, to provide limited financial support for the project subsidiary in the form of limited guarantees, indemnities, capital contributions and agreements to pay certain debt service deficiencies. If our project subsidiaries default on their obligations under the relevant debt documents, creditors of a limited recourse project financing will have direct recourse

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to us, to the extent of our limited recourse obligations, which may require us to use distributions received by us from other projects, as well as other sources of cash available to us, in order to satisfy such obligations. In addition, if our project subsidiaries default on their obligations under the relevant debt documents (or a default under such debt documents arises as a result of a cross-default to the debt documents of some of our other projects) and the creditors foreclose on the relevant collateral, we may lose our ownership interest in the relevant project subsidiary or our project subsidiary owning the project would only retain an interest in the physical assets, if any, remaining after all debts and obligations were paid in full.

Changes in costs and technology may significantly impact our business by making our power plants and products less competitive.

A basic premise of our business model is that generating baseload power at geothermal power plants achieves economies of scale and produces electricity at a competitive price. However, traditional coal-fired systems and gas-fired systems may under certain economic conditions produce electricity at lower average prices than our geothermal plants. In addition, there are other technologies that can produce electricity, most notably fossil fuel power systems, hydroelectric systems, fuel cells, microturbines, windmills and photovoltaic (solar) cells. Some of these alternative technologies currently produce electricity at a higher average price than our geothermal plants; however, research and development activities are ongoing to seek improvements in such alternate technologies and their cost of producing electricity is gradually declining. It is possible that advances will further reduce the cost of alternate methods of power generation to a level that is equal to or below that of most geothermal power generation technologies. If this were to happen, the competitive advantage of our projects may be significantly impaired.

Our expectations regarding the market potential for the development of recovered energy-based power generation may not materialize, and as a result we may not derive any significant revenues from this line of business.

We have identified recovered energy-based power generation as a significant market opportunity for us. Demand for our recovered energy-based power generation units may not materialize or grow at the levels that we expect. We currently face competition in this market from manufacturers of conventional steam turbines and may face competition from other related technologies in the future. If this market does not materialize at the levels that we expect, such failure may materially and adversely affect our business, financial condition, future results and cash flow.

Our intellectual property rights may not be adequate to protect our business.

Our intellectual property rights may not be adequate to protect our business. While we occasionally file patent applications, patents may not be issued on the basis of such applications or, if patents are issued, they may not be sufficiently broad to protect our technology. In addition, any patents issued to us or for which we have use rights may be challenged, invalidated or circumvented.

In order to safeguard our unpatented proprietary know-how, trade secrets and technology, we rely primarily upon trade secret protection and non-disclosure provisions in agreements with employees and others having access to confidential information. These measures may not adequately protect us from disclosure or misappropriation of our proprietary information.

Even if we adequately protect our intellectual property rights, litigation may be necessary to enforce these rights, which could result in substantial costs to us and a substantial diversion of management attention. Also, while we have attempted to ensure that our technology and the operation of our business do not infringe other parties’ patents and proprietary rights, our competitors or other parties may assert that certain aspects of our business or technology may be covered by patents held by them. Infringement or other intellectual property claims, regardless of merit or ultimate outcome, can be expensive and time-consuming and can divert management’s attention from our core business.

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We are subject to risks associated with a changing economic and political environment, which may adversely affect our financial stability or the financial stability of our counterparties.

The risk of terrorist attacks in the United States or elsewhere continues to remain a potential source of disruption to the nation’s economy and financial markets in general. The availability and cost of capital for our business and that of our competitors has been adversely affected by the bankruptcy of Enron Corp. and events related to the California electric market crisis. Additionally, the recent rise in fuel costs may make it more expensive for our customers to operate their businesses. These events could constrain the capital available to our industry and could adversely affect our financial stability and the financial stability of our transaction counterparties.

Possible fluctuations in the cost of construction, raw materials and drilling may materially and adversely affect our business, financial condition, future results and cash flow.

Our manufacturing operations are dependent on the supply of various raw materials, including primarily steel and aluminum, and on the supply of various industrial equipment components that we use. We currently obtain all such materials and equipment at prevailing market prices. We are not dependent on any one supplier and do not have any long-term agreements with any of our suppliers. We have recently experienced increases in the cost of raw materials and in transportation costs. We have also experienced an increase in construction costs, which we expect may intensify due to recent hurricane activity, and an increase in drilling costs. To the extent not otherwise passed along to our customers, these and future cost increases of such raw materials and equipment could adversely affect our profit margins.

Conditions in Israel, where the majority of our senior management and all of our production and manufacturing facilities are located, may adversely affect our operations and may limit our ability to produce and sell our products or manage our projects.

Operations in Israel accounted for approximately 23.7% and 25.6% of our operating expenses in the nine months ended September 30, 2005, and in the year ended December 31, 2004, respectively. Political, economic and security conditions in Israel directly affect our operations. Since the establishment of the State of Israel in 1948, a number of armed conflicts have taken place between Israel and its Arab neighbors, and the continued state of hostility, varying in degree and intensity, has led to security and economic problems for Israel. Since October 2000, there has been a significant increase in violence, primarily in the West Bank and Gaza Strip. As a result, negotiations between Israel and representatives of the Palestinian Authority have been sporadic and have failed to result in peace. We could be adversely affected by hostilities involving Israel, the interruption or curtailment of trade between Israel and its trading partners, or a significant downturn in the economic or financial condition of Israel. In addition, the sale of products manufactured in Israel may be adversely affected in certain countries by restrictive laws, policies or practices directed toward Israel or companies having operations in Israel.

In addition, some of our employees in Israel are subject to being called upon to perform military service in Israel, and their absence may have an adverse effect upon our operations. Generally, unless exempt, male adult citizens of Israel under the age of 41 are obligated to perform up to 36 days of military reserve duty annually. Additionally, all such citizens are subject to being called to active duty at any time under emergency circumstances.

These events and conditions could disrupt our operations in Israel, which could materially harm our business, financial condition, future results and cash flow.

Failure to comply with certain conditions and restrictions associated with tax benefits provided to Ormat Systems Ltd. by the Government of Israel as an ‘‘approved enterprise’’ may require us to refund such tax benefits and pay future taxes in Israel at higher rates.

Our subsidiary, Ormat Systems Ltd., which we refer to as ‘‘Ormat Systems’’, has received ‘‘approved enterprise’’ status under Israel’s Law for Encouragement of Capital Investments, 1959, with respect to two of its investment programs. As an approved enterprise, our subsidiary is exempt from Israeli income taxes with respect to revenues derived from the approved investment program for a

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period of two years commencing on the year it first generates profits from the approved investment program, and thereafter such revenues are subject to a reduced Israeli income tax rate of 25% for an additional five years. These benefits are subject to certain conditions set forth in the certificate of approval from Israel’s Investment Center, which include, among other things, a requirement that Ormat Systems comply with Israeli intellectual property law, that all transactions between Ormat Systems and our affiliates be at arms length, and that there will be no change in control of, on a cumulative basis, more than 49% of Ormat Systems’ capital stock (including by way of a public or private offering) without the prior written approval of the Investment Center. If Ormat Systems does not comply with these conditions, in whole or in part, it would be required to refund the amount of tax benefits (as adjusted by the Israeli consumer price index and for accrued interest) and would no longer benefit from the reduced Israeli tax rate, which could have an adverse effect on our financial condition, future results and cash flow. If Ormat Systems distributes dividends out of revenues derived during the tax exemption period from the approved investment program, it will be subject, in the year in which such dividend is paid, to Israeli income tax on the distributed dividend.

If our parent defaults on its lease agreement with the Israel Land Administration, or is involved in a bankruptcy or similar proceeding, our rights and remedies under certain agreements pursuant to which we acquired our products business and pursuant to which we sublease our land and manufacturing facilities from our parent may be adversely affected.

We acquired our business relating to the manufacture and sale of products for electricity generation and related services from our parent, Ormat Industries. In connection with that acquisition, we entered into a sublease with Ormat Industries for the lease of the land and facilities in Yavne, Israel where our manufacturing and production operations are conducted and where our Israeli offices are located. Under the terms of our parent’s lease agreement with the Israel Land Administration, any sublease for a period of more than five years may require the prior approval of the Israel Land Administration. As a result, the initial term of our sublease with Ormat Industries is for a period of four years and eleven months beginning on July 1, 2004, extendable to twenty-five years less one day (which includes the initial term). The consent of the Israel Land Administration was obtained for a period of the shorter of (i) 25 years or (ii) the remaining period of the underlying lease agreement with the Israel Land Administration, which terminates between 2018 and 2047. If our parent was to breach its obligations to the Israel Land Administration under its lease agreement, the Israel Land Administration could terminate the lease agreement and, consequently, our sublease would terminate as well.

As part of the acquisition described in the preceding paragraph, we also entered into a patent license agreement with Ormat Industries, pursuant to which we were granted an exclusive license for certain patents and trademarks relating to certain technologies that are used in our business. If a bankruptcy case were commenced by or against our parent, it is possible that performance of all or part of the agreements entered into in connection with such acquisition (including the lease of land and facilities described above) could be stayed by the bankruptcy court in Israel or rejected by a liquidator appointed pursuant to the Bankruptcy Ordinance in Israel and thus not be enforceable. Any of these events could have a material and adverse effect on our business, financial condition, future results and cash flow.

We are a holding company and our revenues depend substantially on the performance of our subsidiaries and the projects they operate, most of which are subject to restrictions and taxation on dividends and distributions.

We are a holding company whose primary assets are our ownership of the equity interests in our subsidiaries. We conduct no other business and, as a result, we depend entirely upon our subsidiaries’ earnings and cash flow.

The agreements pursuant to which most of our subsidiaries have incurred debt restrict the ability of these subsidiaries to pay dividends, make distributions or otherwise transfer funds to us prior to the satisfaction of other obligations, including the payment of operating expenses, debt service and replenishment or maintenance of cash reserves. In the case of some of our projects, such as the Mammoth project, there may be certain additional restrictions on dividend distributions pursuant to

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our agreements with our partners. Further, if we elect to receive distributions of earnings from our foreign operations, we may incur United States taxes on account of such distributions, net of any available foreign tax credits. In all of the foreign countries where our existing projects are located, dividend payments to us are also subject to withholding taxes. Each of the events described above may reduce or eliminate the aggregate amount of revenues we can receive from our subsidiaries.

Some of our directors that also hold positions with our parent may have conflicts of interest with respect to matters involving both companies.

Three of our seven directors are directors and/or officers of Ormat Industries. These directors will have fiduciary duties to both companies and may have conflicts of interest on matters affecting both us and our parent, and in some circumstances may have interests adverse to our interests. Our Chairman, Director and Chief Technology Officer, Mr. Bronicki, is the Chairman of our parent, and our Chief Executive Officer and Director, Mrs. Bronicki, is the Chief Executive Officer of our parent.

Risks Related to Our Securities

Investing in the securities to be offered pursuant to this prospectus may involve certain risks. In addition to the below risks regarding our common stock, we will include a description of the material risks relating to particular securities in the prospectus supplement for those securities. You should carefully consider the important factors set forth herein and under the heading ‘‘Risk Factors’’ in the applicable supplement to this prospectus before investing in any securities that may be offered.

Our controlling stockholders may take actions that conflict with your interests.

Ormat Industries, which is controlled by Bronicki Investments Ltd., holds 77.2% of our common stock. Bronicki Investments Ltd. is a privately held Israeli company and is controlled by Lucien and Dita Bronicki. Because of these holdings, our parent company and its controlling stockholders will be able to exercise control over all matters requiring stockholder approval, including the election of directors, amendment of our certificate of incorporation and approval of significant corporate transactions, and they will have significant control over our management and policies. The directors elected by these stockholders will be able to significantly influence decisions affecting our capital structure. This control may have the effect of delaying or preventing changes in control or changes in management, or limiting the ability of our other stockholders to approve transactions that they may deem to be in their best interest. For example, our controlling stockholders will be able to control the sale or other disposition of our products business to another entity or the transfer of such business outside of the State of Israel, as such action requires the affirmative vote of at least 75% of our outstanding shares.

The price of our common stock may fluctuate substantially and your investment may decline in value.

The market price of our common stock is likely to be highly volatile and may fluctuate substantially due to many factors, including:

	•	actual or anticipated fluctuations in our results of operations including as a result of seasonal variations in our electricity-based revenues;

	•	variance in our financial performance from the expectations of market analysts;

	•	conditions and trends in the end markets we serve and changes in the estimation of the size and growth rate of these markets;

	•	announcements of significant contracts by us or our competitors;

	•	changes in our pricing policies or the pricing policies of our competitors;

	•	loss of one or more of our significant customers;

	•	legislation;

	•	changes in market valuation or earnings of our competitors;

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	•	the trading volume of our common stock; and

	•	general economic conditions.

In addition, the stock market in general, and the New York Stock Exchange and the market for energy companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of particular companies affected. These broad market and industry factors may materially harm the market price of our common stock, regardless of our operating performance. In the past, following periods of volatility in the market price of a company’s securities, securities class-action litigation has often been instituted against that company. Such litigation, if instituted against us, could result in substantial costs and a diversion of management’s attention and resources, which could materially harm our business, financial condition, future results and cash flow.

Future sales of common stock by some of our existing stockholders could cause our stock price to decline.

As of the date of this prospectus, our parent, Ormat Industries, holds approximately 77.2% of our outstanding common stock and some of our directors, officers and employees also hold shares of our outstanding common stock. Sales of such shares in the public market, as well as shares we may issue upon the exercise of outstanding options, could cause the market price of our common stock to decline significantly. The perception among investors that these sales may occur could produce the same effect.

Provisions in our charter documents and Delaware law may delay or prevent acquisition of us, which could adversely affect the value of our common stock.

Our second amended and restated certificate of incorporation, which we refer to as our ‘‘Certificate of Incorporation’’, and our second amended and restated by-laws, which we refer to as our ‘‘By-laws’’, contain provisions that could make it harder for a third party to acquire us without the consent of our Board of Directors. These provisions do not permit actions by our stockholders by written consent. In addition, these provisions include procedural requirements relating to stockholder meetings and stockholder proposals that could make stockholder actions more difficult. Our Board of Directors is classified into three classes of directors serving staggered, three-year terms and may be removed only for cause. Any vacancy on the Board of Directors may be filled only by the vote of the majority of directors then in office. Our Board of Directors has the right to issue preferred stock without stockholder approval, which could be used to institute a ‘‘poison pill’’ that would work to dilute the stock ownership of a potential hostile acquirer, effectively preventing acquisitions that have not been approved by our Board of Directors. Delaware law also imposes some restrictions on mergers and other business combinations between us and any holder of 15% or more of our outstanding common stock. Although we believe these provisions provide for an opportunity to receive a higher bid by requiring potential acquirers to negotiate with our Board of Directors, these provisions apply even if the offer may be considered beneficial by some stockholders.

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DESCRIPTION OF DEBT SECURITIES WE MAY OFFER

The following summarizes certain material provisions of our senior debt indenture and our subordinated debt indenture that would be important to holders of debt securities. The following description is only a summary, may be supplemented in prospectus supplements, and is subject to, and qualified in its entirety by reference to, the terms and provisions of our senior debt indenture and our subordinated debt indenture which are exhibits to the registration statement which contains this prospectus.

Overview

We may issue senior or subordinated debt securities. Neither the senior debt securities nor the subordinated debt securities will be secured by any of our property or assets. Thus, by owning a debt security, you are one of our unsecured creditors.

The senior debt securities will constitute part of our senior debt, will be issued under a senior debt indenture described below and will rank equally with all of our other unsecured and unsubordinated obligations.

The subordinated debt securities will constitute part of our subordinated debt, will be issued under a subordinated debt indenture described below and will be subordinate in right of payment to all of our ‘‘senior indebtedness’’, as defined in the subordinated debt indenture and as described below under ‘‘—Subordination Provisions—Senior Indebtedness’’. Neither indenture limits our ability to incur additional senior indebtedness.

In this prospectus, ‘‘debt securities’’ refers to both the senior debt securities and the subordinated debt securities.

We are a Holding Company

Because we are a holding company, our right to participate in any distribution of assets of any of our subsidiaries upon the subsidiary’s liquidation or reorganization or otherwise, is subject to the prior claims of its creditors, except to the extent we may be recognized as a creditor of that subsidiary. Accordingly, our obligations under the debt securities will be effectively subordinated to all existing and future indebtedness and liabilities of our subsidiaries, and you, as holders of debt securities should look only to our assets for payment thereunder.

Indentures and Trustees

Our senior debt securities and our subordinated debt securities are each governed by a document called an indenture, the senior debt indenture, in the case of the senior debt securities, and the subordinated debt indenture, in the case of the subordinated debt securities. Each indenture is a contract between us and Union Bank of California, N.A. (‘‘UBOC’’), which acts as trustee. The indentures are substantially identical, except for the provisions relating to subordination, which are included only in the subordinated debt indenture.

Reference to the indenture or the trustee with respect to any debt securities means the indenture under which those debt securities are issued and the trustee under that indenture.

The trustee has two main roles:

	•	First, the trustee can enforce your rights against us if we default on our obligations under the terms of the applicable indenture or the debt securities. There are some limitations on the extent to which the trustee acts on your behalf, described below under ‘‘—Default and Related Matters—Events of Default—Remedies if an Event of Default Occurs’’; and

	•	Second, the trustee performs administrative duties for us, such as sending you interest payments, transferring your debt securities to a new holder if you sell them and sending you certain notices.

The indentures and their associated documents contain the full legal text of the matters summarized in this section. A copy of the form of senior debt indenture and the form of subordinated

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debt indenture appear as exhibits to our registration statement. See ‘‘Where You Can Find More Information’’ for information on how to obtain copies of the indentures.

Different Series of Debt Securities

We may issue as many distinct series of debt securities under either indenture as we wish. The provisions of each indenture allow us not only to issue debt securities with terms different from those of debt securities previously issued under that indenture, but also to ‘‘reopen’’ a previously issued series of debt securities and issue additional debt securities of that series.

Because this section is a summary, it does not describe every aspect of the debt securities. This summary is subject to and qualified in its entirety by reference to all the provisions of the indentures, including definitions of some of the terms used in the indentures. We discuss only the more important terms in this prospectus. Whenever we refer to the defined terms of the indentures in this prospectus or in a prospectus supplement, those defined terms are incorporated by reference here or in the prospectus supplement. You must look to the indentures for the most complete description of what we describe in summary form in this prospectus.

This summary also is subject to and qualified by reference to the description of the particular terms of your series described in the prospectus supplement. Those terms may vary from the terms described in this prospectus. The prospectus supplement will describe any differences with the material terms summarized here. The prospectus supplement relating to each series of debt securities will be attached to the front of this prospectus. There may also be a further prospectus supplement, known as a pricing supplement, which contains the precise terms of debt securities you are offered.

Tax Treatment of Original Issue Discount and Other Debt Securities

We may issue debt securities as original issue discount securities, which are securities that are offered and sold at a substantial discount to their stated principal amount and which may provide that, upon redemption or acceleration of maturity, an amount less than their principal amount will be payable. The prospectus supplement relating to original issue discount securities will describe the U.S. federal income tax consequences and other special considerations applicable to them. We may also issue debt securities as indexed securities or securities denominated in foreign currencies, currency units or composite currencies, which may trigger special U.S. federal income tax, accounting and other consequences, all as described in more detail in the prospectus supplement relating to any of the particular debt securities.

A Prospectus Supplement and a Supplemental Indenture (If Required) Will Describe the Specific Terms of a Series of Debt Securities

The specific financial, legal and other terms particular to a series of debt securities will be described in the prospectus supplement, supplemental indenture (if required) and the pricing supplement relating to the series. The prospectus supplement and supplemental indenture (if required) relating to a series of debt securities will describe the following terms of the series:

	•	the title of the series of debt securities;

	•	whether it is a series of senior debt securities or a series of subordinated debt securities;

	•	the aggregate principal amount of the series of debt securities and any limit thereon;

	•	the person to whom interest on a debt security is payable, if that person is not a holder on the regular record date;

	•	the date or dates on which the series of debt securities will mature;

	•	the price at which we originally issue your debt security, expressed as a percentage of the principal amount, and the original issue date;

	•	the rate or rates, which may be fixed, variable or indexed, per annum at which the series of debt securities will bear interest, if any, and the date or dates from which that interest, if any, will accrue;

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	•	the place or places where the principal of (and premium, if any) and interest on the debt securities is payable;

	•	the dates on which interest, if any, on the series of debt securities will be payable and the regular record dates for the interest payment dates;

	•	any mandatory or optional sinking funds or analogous provisions or provisions for redemption at our option or the option of the holder;

	•	the date, if any, on or after which and the price or prices at which the series of debt securities may, in accordance with any optional or mandatory redemption provisions, be redeemed and the other detailed terms and provisions of those optional or mandatory redemption provisions, if any;

	•	if the debt securities may be converted into securities or other property (including shares of our common stock or preferred shares or any other of our securities) other than the debt securities of the same series and of like tenor, the terms on which such conversion, issuance or payment may occur, including whether such conversion, issuance or payment is in addition to, or in lieu of, any payment of principal or other amount and whether such conversion, issuance or payment is at our option or otherwise;

	•	whether the debt securities are subject to mandatory or optional remarketing or other mandatory or optional resale provisions, and, if applicable, the date or period during which a resale may occur, any conditions to the resale and any right of a holder to substitute securities for the securities subject to resale;

	•	the denominations in which the series of debt securities will be issuable, including if other than in denominations of $1,000 and any integral multiple thereof;

	•	if other than the principal amount thereof, the portion of the principal amount of the series of debt securities which will be payable upon the declaration of acceleration of the maturity of that series of debt securities;

	•	the currency or currencies, including currency units or composite currencies, of payment of principal, premium, if any, and interest on the series of debt securities and any special considerations relating to that currency or those currencies;

	•	if the currency or currencies, including currency units or composite currencies, of payment for principal, premium, if any, and interest on the series of debt securities is subject to our or a holder’s election, the currency or currencies in which payment can be made and the period within which, and the terms and conditions upon which, the election can be made;

	•	any index, formula or other method used to determine the amount of payment of principal or premium, if any, and interest, if any, on the series of debt securities;

	•	the applicability of the provisions described below under ‘‘—Restrictive Covenants’’ and ‘‘—Defeasance’’;

	•	any event of default under the series of debt securities if different from those described below under ‘‘—Default and Related Matters—Events of Default—What Is an Event of Default?’’;

	•	if the series of debt securities will be issuable only in the form of a global security, as described below under ‘‘—Legal Ownership—Global Securities’’, the depositary or its nominee with respect to the series of debt securities and the circumstances under which the global security may be registered for transfer or exchange in the name of a person other than the depositary or its nominee;

	•	if applicable, a discussion of U.S. federal income tax considerations applicable to specific debt securities;

	•	any proposed listing of the series of debt securities on any securities exchange; and

	•	any other special feature of the series of debt securities.

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Those terms may vary from the terms described here. Accordingly, this summary also is subject to and qualified by reference to the description of the terms of the series described in the applicable prospectus supplement and any supplemental indenture.

Legal Ownership

Street Name and Other Indirect Holders

We generally will not recognize investors who hold debt securities in accounts at banks or brokers, i.e. in ‘‘street name’’, as legal holders of debt securities. Instead, we would recognize only the bank or broker, or the financial institution the bank or broker uses to hold its debt securities. These intermediary banks, brokers and other financial institutions pass along principal, interest and other payments on the debt securities, either because they agree to do so in their customer agreements or because they are legally required to do so. If you hold debt securities in street name, you are responsible for checking with your own institution to find out:

	•	how it handles securities payments and notices;

	•	how it would handle a request for the holders’ consent if ever required;

	•	whether it imposes fees or charges;

	•	how it would handle voting if ever required;

	•	whether and how you can instruct it to send you debt securities registered in your own name so you can be a direct holder as described below; and

	•	how it would pursue rights under the debt securities if there were a default or other event triggering the need for holders to act to protect their interests.

Direct Holders

Our obligations, as well as the obligations of the trustee and those of any third parties employed by us or the trustee, run only to persons or entities who are the direct holders of debt securities, which means those who are registered as holders of debt securities. As noted above, we will not have obligations to you if you hold in street name or through other indirect means, either because you choose to hold debt securities in that manner or because the debt securities are issued in the form of global securities as described below. For example, once we make payment to the registered holder, we will have no further responsibility for that payment even if that registered holder is legally required to pass the payment along to you as a street name holder but does not do so.

Global Securities

What Is a Global Security?    A global security is a special type of indirectly held security, as described above under ‘‘—Legal Ownership—Street Name and Other Indirect Holders’’.

If we choose to issue debt securities in the form of global securities, the ultimate beneficial owners can only be indirect holders. We do this by requiring that the global security be registered in the name of a financial institution we select and by requiring that the debt securities included in the global security not be transferred to the name of any other direct holder unless the special circumstances described below occur. The financial institution that acts as the sole direct holder of the global security is called the depositary.

Any person wishing to own a debt security included in the global security must do so indirectly by virtue of an account with a broker, bank or other financial institution that in turn has an account with the depositary. The prospectus supplement will indicate whether your series of debt securities will be issued only in the form of global securities.

Special Investor Considerations for Global Securities. As an indirect holder, an investor’s rights relating to a global security will be governed by the account rules of the investor’s financial institution and of the depositary, as well as general laws relating to securities transfers. We will not recognize this type of investor as a registered holder of debt securities and instead deal only with the depositary that holds the global security.

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If you are an investor in debt securities that are issued only in the form of global securities, you should be aware that:

	•	you cannot get debt securities registered in your own name except in certain limited circumstances as described below under ‘‘—Legal Ownership—Global Securities—Special Situations When Global Security Will Be Cancelled’’;

	•	you cannot receive physical certificates for your interest in the debt securities;

	•	you will be a street name holder and must look to your own bank or broker for payments on the debt securities and protection of your legal rights relating to the debt securities. See ‘‘—Legal Ownership—Street Name and Other Indirect Holders’’;

	•	you may not be able to sell interests in the debt securities to some insurance companies and other institutions that are required by law to own their securities in the form of physical certificates;

	•	the depositary’s policies will govern payments, transfers, exchange and other matters relating to your interest in the global security. We and the trustee have no responsibility for any aspect of the depositary’s actions or for its records of ownership interests in the global security. We and the trustee also do not supervise the depositary in any way; and

	•	the depositary will require that interests in a global security be purchased or sold within its system using same-day funds for settlement.

Special Situations When Global Security Will Be Cancelled. In a few special situations described below, the global security will be cancelled and interests in it will be exchanged for physical certificates representing debt securities. After that exchange, the choice of whether to hold debt securities directly or in street name will be up to you. You must consult your own bank or broker to find out how to have your interests in debt securities transferred to your own name, so that you will be a direct holder.

The special situations for cancellation of a global security are:

	•	when the depositary notifies us that it is unwilling, unable or no longer qualified to continue as depositary;

	•	when we notify the trustee that we wish to cancel (subject to the procedures of the depositary) the global security; or

	•	when an event of default on the debt securities has occurred and has not been cured.

Defaults are discussed later under ‘‘—Default and Related Matters’’.

The prospectus supplement may also list additional situations for cancellation of a global security that would apply only to the particular series of debt securities covered by the prospectus supplement. When a global security is cancelled, the depositary, not we nor the trustee, is responsible for deciding the names of the institutions that will be the initial direct holders.

In the remainder of this description, ‘‘you’’ means direct holders and not street name or other indirect holders of debt securities. Indirect holders should read the previous subsection entitled ‘‘—Legal Ownership—Street Name and Other Indirect Holders’’.

Overview of the Remainder of this Description

The remainder of this description summarizes:

	•	additional mechanics relevant to our debt securities under normal circumstances, such as how you transfer ownership and where we make payments;

	•	your rights under several special situations, such as if we merge with another company or if we want to change a term of the debt securities;

	•	subordination provisions in the subordinated debt indenture that may prohibit us from making payments on those securities;

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	•	a particular series of debt securities may have additional, fewer or different restrictive covenants;

	•	situations in which we may invoke the provisions relating to defeasance;

	•	your rights if we default or experience other financial difficulties;

	•	conversion or exchange rights;

	•	redemption;

	•	reopenings; and

	•	our relationship with the trustee.

Additional Mechanics

Form, Exchanges and Transfer of our Debt Securities

Form. The debt securities will be issued:

	•	only in fully registered form;

	•	without interest coupons; and

	•	unless otherwise indicated in the applicable prospectus supplement and any supplemental indenture, in denominations that are integral multiples of $1,000.

You may have your debt securities broken into more debt securities of smaller denominations or combined into fewer debt securities of larger denominations, as long as the total principal amount is not changed. This is called an exchange. You may not exchange your debt securities for securities of a different series or having different terms, unless your prospectus supplement says you may.

Exchanges and Transfers. You may exchange or transfer debt securities at the office of the trustee. You may also replace lost, stolen, destroyed or mutilated debt securities at that office. The trustee acts as our agent for registering debt securities in the names of holders and transferring debt securities. We may change this appointment to another entity or perform the service ourselves. The entity performing the role of maintaining the list of registered direct holders is called the ‘‘security registrar’’. It will also register transfers of the debt securities.

You will not be required to pay a service charge to transfer or exchange debt securities, but you may be required to pay for any tax or other governmental charge associated with the exchange or transfer. The transfer or exchange will only be made if the security registrar is satisfied with your proof of ownership.

If we designate additional transfer agents, they will be named in the prospectus supplement. We may cancel the designation of any particular transfer agent. We may also approve a change in the office through which any transfer agent acts.

If the debt securities are redeemable and we redeem less than all of the debt securities of a particular series, we may block the transfer or exchange of debt securities during the period beginning 15 days before the day we mail the notice of redemption and ending on the day of that mailing, in order to freeze the list of holders to prepare the mailing. We may also refuse to register transfers or exchanges of debt securities selected for redemption, except that we will continue to permit transfers and exchanges of the unredeemed portion of any debt security being partially redeemed.

Payment and Paying Agents

We will pay interest to you if you are a direct holder listed in the trustee’s records at the close of business on a particular day, called the regular record date, in advance of each due date for interest, even if you no longer own the debt security on the interest due date. The regular record date is usually about two weeks in advance of the interest due date and is stated in the prospectus supplement. Holders buying and selling debt securities must work out between them how to compensate for the fact that we will pay all the interest for an interest period to the one who is the

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registered holder on the regular record date. The most common manner is to adjust the sales price of the debt securities to prorate interest fairly between buyer and seller.

We will pay interest, principal and any other money due on the debt securities at the office as we may designate at various times. You must make arrangements to have your payments picked up at or wired from that office. We may also choose to pay interest by mailing checks.

If you are a street name holder or other indirect holder, you should consult your bank or your broker for information on how you will receive payments.

We may also arrange for additional payment offices, and may cancel or change these offices, including our use of the trustee’s corporate trust office. These offices are called paying agents. We may also choose to act as our own paying agent. We must notify you of changes in the paying agents for any particular series of debt securities.

Notices

We and the trustee will send notices regarding the debt securities only to direct holders, using their addresses as listed in the trustee’s records.

Unclaimed Payments

Regardless of whom acts as paying agent, all money paid by us to a paying agent that remains unclaimed at the end of one year after the amount is due to direct holders will be repaid to us. After that one-year period, you may look only to us for payment and not to the trustee, any other paying agent or anyone else.

Special Situations

Mergers and Similar Events

We are generally permitted to consolidate or merge with another company or firm. We are also permitted to sell or lease substantially all of our assets to another company or firm, or to buy or lease substantially all of the assets of another company or firm. However, we may not take any of these actions unless the following conditions, among others, are met:

	•	Where we merge out of existence or sell or lease substantially all our assets, the other company or firm must be a corporation, partnership or trust organized under the laws of a State of the United States or the District of Columbia or under United States federal law, and it must agree to be legally responsible for the debt securities.

	•	The consolidation, merger, sale of assets or other transaction must not cause a default on the debt securities, and we must not already be in default, unless the transaction would cure the default. For purposes of this no-default test, a default would include an event of default that has occurred and not been cured. A default for this purpose would also include any event that would be an event of default if the requirements for giving us notice of our default or our default having to exist for a specific period of time were disregarded.

	•	Where the consolidation, merger, sale of assets or other transaction would cause some of our property to become subject to a mortgage or other legal mechanism giving lenders preferential rights in that property over other lenders, we or the successor company must take such steps necessary to secure the debt securities equally and ratably with all indebtedness secured thereby.

Modification and Waiver

There are four types of changes we can make to either indenture and the applicable series of debt securities issued under that indenture.

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Changes Requiring Your Approval. First, there are changes that cannot be made to your debt securities without your specific approval. Following is a list of these types of changes:

	•	change to the payment due date of the principal or interest on a debt security;

	•	reduction of any amounts due on a debt security;

	•	reduction of the amount of principal payable upon acceleration of the maturity of a debt security, including the amount payable on an original issue discount security, following a default;

	•	change to the place or currency of payment on a debt security;

	•	impairment of your right to sue for payment of any amount due on your debt security;

	•	impairment of any right that you may have to exchange or convert the debt security for or into other securities or property;

	•	reduction of the percentage of direct holders of debt securities whose consent is needed to modify or amend the applicable indenture;

	•	reduction of the percentage of direct holders of debt securities whose consent is needed to waive our compliance with certain provisions of the applicable indenture or to waive certain defaults; and

	•	modification of any other aspect of the provisions dealing with modification and waiver of the applicable indenture.

Changes Requiring a Majority Vote. The second type of change to a particular indenture and the debt securities is the kind that requires a vote in favor by direct holders of debt securities owning a majority of the principal amount of each series affected thereby. Most changes, including waivers, as described below, fall into this category, except for changes noted above as requiring the approval of the holders of each security affected thereby, and, as noted below, changes not requiring approval.

Each indenture provides that a supplemental indenture which changes or eliminates any covenant or other provision of the applicable indenture which has expressly been included solely for the benefit of one or more particular series of securities, or which modifies the rights of the holders of securities of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under the applicable indenture of the holders of securities of any other series.

Changes Not Requiring Approval. The third type of change does not require any vote by holders of debt securities. This type is limited to clarifications and certain other changes referenced in our indentures that would not adversely affect holders of the debt securities.

Changes by Waiver Requiring a Majority Vote. Fourth, we need the approval of direct holders of senior debt securities owning a majority of the principal amount of the particular series affected to obtain a waiver of certain of the restrictive covenants. We also need such majority approval to obtain a waiver of any past default, except a default of the payment of principal, premium (if any) or interest, as described in the first two categories described below under ‘‘—Default and Related Matters—Events of Default’’.

Modification of Subordination Provisions. In addition, we may not modify the subordination provisions of the subordinated debt indenture in a manner that would adversely affect the outstanding subordinated debt securities of any one or more series in any material respect without the consent of the direct holders of a majority in aggregate principal amount of each affected series.

Further Details Concerning Voting. When taking a vote, we will use the following rules to decide how much principal amount to attribute to a debt security:

	•	for original issue discount securities, we will use the principal amount that would be due and payable on the voting date if the maturity of the debt securities were accelerated to that date because of a default;

	•	for debt securities whose principal amount is not known, for example, because it is based on an index, we will use a special rule for that debt security described in the applicable prospectus supplement; or

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	•	for debt securities denominated in one or more foreign currencies, currency units or composite currencies, we will use the U.S. dollar equivalent.

Debt securities will not be considered outstanding, and therefore will not be eligible to vote, if we have deposited or set aside in trust for you money for their payment or redemption. Debt securities will also not be eligible to vote if they have been fully defeased as described below under ‘‘—Defeasance—Full Defeasance’’.

We will generally be entitled to set any day as a record date for the purpose of determining the direct holders of outstanding debt securities that are entitled to vote or take other action under the applicable indenture. In some circumstances, the trustee will be entitled to set a record date for action by direct holders. If we or the trustee set a record date for a vote or other action to be taken by holders of a particular series, that vote or action may be taken only by persons who are direct holders of outstanding securities of that series on the record date and must be taken within 90 days following the record date.

If you are a street name holder or other indirect holder, you should consult your bank or broker for information on how you may grant or deny approval if we seek to change an indenture or the debt securities or request a waiver.

Subordination Provisions

Direct holders of subordinated debt securities must recognize that contractual provisions in the subordinated debt indenture may prohibit us from making payments on those securities. Subordinated debt securities are subordinate and junior in right of payment, to the extent and in the manner stated in the subordinated debt indenture, to all of our senior indebtedness, as defined in the subordinated debt indenture, including all debt securities we have issued and will issue under the senior debt indenture.

Senior Indebtedness

Under the subordinated debt indenture, ‘‘senior indebtedness’’ includes all of our obligations to pay principal, premium, if any, interest, penalties, fees and other charges:

	•	for borrowed money;

	•	in the form of or evidenced by securities, notes, debentures, bonds or similar instruments, including obligations incurred in connection with our purchase of property, assets or businesses;

	•	under capital leases;

	•	under letters of credit and bankers’ acceptances;

	•	issued or assumed in the form of a deferred purchase price of property or services, such as master leases;

	•	under swaps and other hedging arrangements; and

	•	pursuant to our guarantee of another entity’s obligations and all dividend obligations guaranteed by us.

The following types of our indebtedness will not rank senior to the subordinated debt securities:

	•	indebtedness incurred in the form of trade accounts payable or accrued liabilities arising in the ordinary course of business, including liabilities under reinsurance and retrocessional agreements;

	•	indebtedness which, by its terms, expressly provides that it does not rank senior to the subordinated debt securities;

	•	indebtedness we owe to a subsidiary of ours; and

	•	indebtedness we owe to any trust or a trustee of such trust, partnership or other entity affiliated with us, which is our financing vehicle unless the terms of that indebtedness expressly provide otherwise.

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Payment Restrictions on our Subordinated Debt

The subordinated debt indenture provides that, unless all principal of and any premium or interest on the senior indebtedness has been paid in full, no payment or other distribution may be made in respect of any subordinated debt securities in the following circumstances:

	•	in the event of any insolvency or bankruptcy proceedings, or any receivership, liquidation, reorganization, assignment for creditors or other similar proceedings or events involving us or our assets; or

	•	(a) in the event and during the continuation of any default in the payment of principal, premium, if any, or interest on any senior indebtedness beyond any applicable grace period, (b) in the event that any event of default with respect to any senior indebtedness has occurred and is continuing, permitting the direct holders of that senior indebtedness (or a trustee) to accelerate the maturity of that senior indebtedness, whether or not the maturity is in fact accelerated (unless, in the case of either (a) or (b), the payment default or event of default has been cured or waived or ceased to exist and any related acceleration has been rescinded), or (c) in the event that any judicial proceeding is pending with respect to a payment default or event of default described in (a) or (b).

If the trustee under the subordinated debt indenture or any direct holders of the subordinated debt securities receive any payment or distribution that is prohibited under the subordination provisions, then the trustee or the direct holders will have to repay that money to the direct holders of the senior indebtedness.

Even if the subordination provisions prevent us from making any payment when due on the subordinated debt securities of any series, we will be in default on our obligations under that series if we do not make the payment when due. This means that the trustee under the subordinated debt indenture and the direct holders of that series can take action against us, but they will not receive any money until the claims of the direct holders of senior indebtedness have been fully satisfied.

Restrictive Covenants

General

We have made certain promises in each indenture called covenants where, among other things, we promise to maintain our corporate existence and all licenses and material permits necessary for our business.

We will describe any additional restrictive covenants for any series of debt securities in the relevant prospectus supplement.

Defeasance

The following discussion of full defeasance and covenant defeasance will apply to your series of debt securities only if we choose to have them apply to that series. If we do so choose, we will state that in the applicable prospectus supplement.

Full Defeasance

We can legally release ourselves from any payment or other obligations on the debt securities, called full defeasance, if we put in place the following arrangements for you to be repaid:

	•	we must deposit in trust for your benefit and the benefit of all other direct holders of the debt securities money or U.S. government or U.S. government agency notes or bonds or a combination thereof that will generate enough cash to make interest, principal and any other payments on the debt securities on their various due dates;

	•	there must be a change in current U.S. federal income tax law or a U.S. Internal Revenue Service ruling that lets us make the above deposit without causing you to be taxed on the debt securities any differently than if we did not make the deposit and just repaid the debt

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		securities ourselves. (Under current federal tax law, the deposit and our legal release from the debt securities would be treated as though we took back your debt securities and gave you your share of the cash and notes or bonds deposited in trust. In that event, you could recognize gain or loss on the debt securities you give back to us.);

	•	we must deliver to the trustee a legal opinion of our counsel confirming the tax law change described above and that under current federal income tax law we may make the above deposit without causing you to be taxed on the debt securities any differently than if we did not make the deposit and just repaid the debt securities ourselves;

	•	the full defeasance must not result in a breach or violation of, or constitute a default under the applicable indenture or any other agreement or instrument to which we are a party or by which we are bound;

	•	no event of default or event which with notice or lapse of time or both would become an event of default with respect to the debt securities to be defeased may occur and be continuing on the date of such deposit (other than an Event of Default resulting from the incurrence of indebtedness all or a portion of the proceeds of which will be used to defease the debt securities concurrently with such incurrence) and no bankruptcy proceeding may occur and be continuing at any time during the period ending on the 90th day after the date of such deposit or, if longer, ending on the day following the expiration of the longest preference period applicable to us in respect of such deposit; and

	•	in the case of the subordinated debt securities, the following requirements must also be met:

	•	no event or condition may exist that, under the provisions described above under ‘‘—Subordination Provisions’’, would prevent us from making payments of principal, premium or interest on those subordinated debt securities on the date of the deposit referred to above or during the 90 days after that date; and

	•	we must deliver to the trustee an opinion of counsel to the effect that (a) the trust funds will not be subject to any rights of direct holders of senior indebtedness and (b) after the 90-day period referred to above, the trust funds will not be subject to any applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally, except that if a court were to rule under any of those laws in any case or proceeding that the trust funds remained our property, then the relevant trustee and the direct holders of the subordinated debt securities would be entitled to some enumerated rights as secured creditors in the trust funds.

If we accomplish full defeasance, as described above, you will have to rely solely on the trust deposit for repayment on the debt securities. In addition, in the case of subordinated debt securities, the provisions described above under ‘‘—Subordination Provisions’’ would not apply. You could not look to us for repayment in the event of any shortfall. Conversely, the trust deposit would most likely be protected from claims of our lenders and other creditors if we ever become bankrupt or insolvent.

Covenant Defeasance

Under current U.S. federal income tax law, we can make the same type of deposit described above and be released from the restrictive covenants listed below in the debt securities without causing tax consequences to you. This type of release is called covenant defeasance. If we ever did accomplish covenant defeasance, you would lose the protection of those restrictive covenants but would gain the protection of having money and securities set aside in trust to repay the debt securities. In order to achieve covenant defeasance, we must do the following:

	•	we must deposit in trust for your benefit and the benefit of all other direct holders of the debt securities a combination of money and U.S. government or U.S. government agency notes or bonds that will generate enough cash to make interest, principal and any other payments on the debt securities on their various due dates;

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	•	we must deliver to the trustee a legal opinion of our counsel confirming that under current federal income tax law we may make the above deposit without causing you to be taxed on the debt securities any differently than if we did not make the deposit and just repaid the debt securities ourselves;

	•	the covenant defeasance must not result in a breach or violation of, or constitute a default under the applicable indenture or any other agreement or instrument to which we are a party or by which we are bound; and

	•	no event of default or event which with notice or lapse of time or both would become an event of default with respect to the debt securities to be defeased will have occurred and be continuing on the date of such deposit (other than an Event of Default resulting from the incurrence of indebtedness all or a portion of the proceeds of which will be used to defease the debt securities concurrently with such incurrence) and no bankruptcy proceeding will have occurred and be continuing at any time during the period ending on the 90th day after the date of such deposit or, if longer, ending on the day following the expiration of the longest preference period applicable to us in respect of such deposit.

If we accomplish covenant defeasance, the following provisions, among others, of the indentures and the debt securities would no longer apply:

	•	any covenants applicable to the series of debt securities and described in the prospectus supplement;

	•	the condition regarding the treatment of liens when we merge or engage in similar transactions, as described above under ‘‘—Special Situations—Mergers and Similar Events’’; and

	•	the events of default relating to breach of covenants, described below under ‘‘—Default and Related Matters—Events of Default—What Is an Event of Default?’’.

In addition, in the case of subordinated debt securities, the provisions described above under ‘‘—Subordination Provisions’’ will not apply if we accomplish covenant defeasance.

If we accomplish covenant defeasance, you could still look to us for repayment of the debt securities if there were a shortfall in the trust deposit. In fact, if one of the remaining events of default occurs, such as our bankruptcy, and the debt securities become immediately due and payable, there may be a shortfall in the trust deposit. Depending on the event causing the default, you may not be able to obtain payment of the shortfall.

Default and Related Matters

The debt securities are not secured by any of our property or assets. Accordingly, your ownership of debt securities means that you are one of our unsecured creditors. The senior debt securities are not subordinated to any of our debt obligations and therefore they rank equally with all of our other unsecured and unsubordinated indebtedness. The subordinated debt securities are subordinate and junior in right of payment to all of our senior indebtedness, as defined in the subordinated debt indenture and as described above under ‘‘—Subordination Provisions’’.

Events of Default

You will have special rights if an event of default occurs and is not cured or waived, as described below in this subsection.

What Is an Event of Default?    The term ‘‘event of default’’ means any of the following:

	•	we do not pay the principal or any premium on a debt security on its due date;

	•	we do not pay interest on a debt security within 30 days of its due date;

	•	we do not deposit money into a separate custodial account, known as a sinking fund, when such deposit is due, if we agree to maintain any such sinking fund;

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	•	we remain in breach of any covenant or warranty of the applicable indenture for 60 days after we receive a notice of default stating we are in breach and requiring us to remedy that default or breach; the notice must be sent by either the trustee or direct holders of at least 25% of the principal amount of the outstanding debt securities of the affected series;

	•	we default under any bond, debenture, note or other evidence of indebtedness for money borrowed by us having an aggregate principal amount outstanding of at least $50,000,000, or under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any indebtedness for money borrowed by us having an aggregate principal amount outstanding of at least $50,000,000, whether such indebtedness now exists or shall hereafter be created;

	•	we file for bankruptcy or certain other events of bankruptcy, insolvency or reorganization occur; or

	•	any other event of default described in the prospectus supplement occurs.

Remedies If an Event of Default Occurs. If an event of default has occurred and has not been cured or waived, the trustee or the direct holders of 25% in principal amount of the debt securities of the affected series may declare the entire principal amount, or, in the case of original issue discount securities, the portion of the principal amount that is specified in the terms of the affected debt security, of all the debt securities of that series to be due and immediately payable. This is called a declaration of acceleration of maturity. However, a declaration of acceleration of maturity may be canceled by the direct holders of at least a majority in principal amount of the debt securities of the affected series. If you are the holder of a subordinated debt security, all remedies available to you upon the occurrence of an event of default under the subordinated debt indenture will be subject to the restrictions on the subordinated debt securities described above under ‘‘—Subordination Provisions’’, subject to applicable law and certain terms of the indenture.

You should refer to the prospectus supplement relating to any series of debt securities that are original issue discount securities for the particular provisions relating to acceleration of the maturity of a portion of the principal amount of original issue discount securities upon the occurrence of an event of default and its continuation.

Except in cases of default, where the trustee has some special duties, the trustee is not required to take any action under the indentures at the request of any holders unless the direct holders offer the trustee reasonable protection from expenses and liability, called an indemnity. If reasonable indemnity is provided, the direct holders of a majority in principal amount of the outstanding debt securities of the relevant series may direct the time, method and place of conducting any lawsuit or other formal legal action seeking any remedy available to the trustee. These majority direct holders may also direct the trustee in performing any other action under the applicable indenture with respect to the debt securities of that series.

Before you bypass the trustee and bring your own lawsuit or other formal legal action or take other steps to enforce your rights or protect your interests relating to the debt securities, the following must occur:

	•	you must give the trustee written notice that an event of default has occurred and remains uncured;

	•	the direct holders of 25% in principal amount of all outstanding debt securities of the relevant series must make a written request that the trustee take action because of the default, and must offer reasonable indemnity to the trustee against the cost and other liabilities of taking that action;

	•	the trustee must have not received from direct holders of a majority in principal amount of the outstanding debt securities of that series a direction inconsistent with the written notice; and

	•	the trustee must have not taken action for 60 days after receipt of the above notice and offer of indemnity.

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You are, however, entitled at any time to bring a lawsuit for the payment of money due on your debt security on or after its due date.

If you are a street name holder or other indirect holder, you should consult your bank or your broker for information on how to give notice or direction to or make a request of the trustee and to make or cancel a declaration of acceleration.

We will furnish to the trustee every year a written statement of certain of our officers certifying that to their knowledge we are in compliance with the applicable indenture and the debt securities issued under it, or else specifying any default.

Conversion or Exchange

The terms on which debt securities of any series are convertible into or exchangeable for shares of our common stock or other securities or property of ours or of third parties will be set forth in the applicable prospectus supplement and any supplemental indenture. These terms will include:

	•	the conversion or exchange price, or manner for calculating such a price;

	•	the exchange or conversion period; and

	•	whether the conversion or exchange is mandatory, at the option of the holder, or at our option.

The terms may also include calculations pursuant to which the number of shares of our or a third party’s common stock or other securities or property to be received by the holders of debt securities would be determined according to the market price of our common stock or other securities or property of ours or of third parties as of a time stated in the prospectus supplement. The conversion or exchange price of any debt securities of any series that is convertible into our common stock may be adjusted for any share dividends, bonus issues, stock splits, subdivisions, reclassification, combinations or similar transactions, in each case as we may describe in the applicable prospectus supplement.

Redemption

Unless we state otherwise in an applicable prospectus supplement and any supplemental indenture, debt securities will not be subject to any sinking fund.

If we issue redeemable debt securities, the dates and terms on which those securities are mandatorily or optionally redeemable will be set forth in the applicable prospectus supplement and any supplemental indenture. If a series of debt securities is redeemable, the redemption price for any debt security that we redeem will equal 100% of the principal amount plus any accrued and unpaid interest up to, but excluding, the redemption date, unless otherwise specified in the applicable prospectus supplement and any supplemental indenture.

Reopenings

The provisions of each indenture allow us to ‘‘reopen’’ a series of our debt securities. This means that we can increase the principal amount of a series of our debt securities by selling additional debt securities with the same terms. We may do so without notice to the existing holders of debt securities of that series. However, any new debt securities of this kind may begin to bear interest at a different date and they may be offered or sold at prices that are different from the original offering or sale of the same series of debt securities depending on then prevailing market conditions.

Governing Law; Submission to Jurisdiction

The indentures are, and the debt securities will be, governed by and construed in accordance with the laws of the State of New York. We will submit to the jurisdiction of the United States federal and New York State courts located in the Borough of Manhattan, City and State of New York for purposes of all legal actions and proceedings instituted in connection with our debt securities and the indentures.

Our Relationship with the Trustee

The trustee under our senior indenture and our subordinated indenture is UBOC. We and our subsidiaries maintain banking and other service relationships with UBOC.

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DESCRIPTION OF COMMON STOCK WE MAY OFFER

The following summarizes certain material provisions of our Certificate of Incorporation, By-laws and applicable provisions of Delaware law that are important to holders of shares of our common stock. The following description is only a summary, may be supplemented in prospectus supplements and is subject to, and qualified in its entirety by reference to, the terms and provisions of our Certificate of Incorporation and By-laws and other agreements which are exhibits to the registration statement which contains this prospectus.

Authorized Capital

Our Certificate of Incorporation provides that our authorized capital stock will consist of an aggregate number of 200,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred stock, par value $0.001 per share, of which our board of directors has designated 500,000 shares as Series A Junior Participatory Preferred Stock for issuance in connection with the exercise of our preferred share purchase rights. See ‘‘—Provisions of Our Certificate of Incorporation and By-laws, Rights Plan and Delaware Law that May Have an Anti-Takeover Effect-Rights Plan’’ below. As of January 12, 2006, 31,562,496 shares of our common stock were issued and outstanding, of which 24,374,996 were owned by our parent company, Ormat Industries, Ltd. In addition, 247,500 shares of our common stock have been reserved for issuance upon exercise of outstanding options and 1,002,500 shares of our common stock have been reserved for additional issuance under our 2004 Incentive Compensation Plan.

Common Stock

Voting. The holders of our common stock are entitled to one vote for each outstanding share of common stock owned by that stockholder on every matter properly submitted to the stockholders for their vote. Stockholders are not entitled to vote cumulatively for the election of directors.

Dividend Rights. Subject to the dividend rights of the holders of any outstanding series of preferred stock, holders of our common stock are entitled to receive ratably such dividends and other distributions of cash or any other right or property as may be declared by our board of directors out of our assets or funds legally available for such dividends or distributions.

Liquidation Rights. In the event of any voluntary of involuntary liquidation, dissolution or winding up of our affairs, holders of our common stock would be entitled to share ratably in our assets that are legally available for distribution to stockholders after payment of liabilities. If we have any preferred stock outstanding at such time, holders of the preferred stock may be entitled to distribution and/or liquidation preferences. In either such case, we must pay the applicable distribution to the holders of our preferred stock before we may pay distributions to the holders of our common stock.

Conversion, Redemption and Preemptive Rights. Holders of our common stock have no conversion, redemption, preemptive, subscription or similar rights.

Preferred Stock

As noted above, the rights, preferences and privileges of holders of our common stock may be affected by the rights, preferences and privileges granted to holders of preferred stock. For this reason, you should be aware that our Certificate of Incorporation authorizes our board of directors, subject to limitations prescribed by law, to issue up to 5,000,000 shares of preferred stock in one or more series without further stockholder approval. The board will have discretion to determine the rights, preferences, privileges and restrictions of, including, without limitation, voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences of, and to fix the number of shares of, each series of our preferred stock.

Our board of directors has designated 500,000 shares of our preferred stock as Series A Junior Participatory Preferred Stock for issuance in connection with the exercise of our preferred share

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purchase rights. Although our board of directors has no intention at the present time of doing so, it could authorize the issuance of shares of preferred stock with terms and conditions that could have the effect of delaying, deferring or preventing a transaction or a change in control that might involve a premium price for holders of our common stock or otherwise be in their best interest. See ‘‘—Rights Plan’’ below.

Limitations on Directors’ and Officers’ Liability

Section 102(b)(7) of the Delaware General Corporation Law, which we refer to as the "DGCL", permits a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability for:

	•	any breach of his or her duty of loyalty to us or our stockholders;

	•	acts or omissions not in good faith which involve intentional misconduct or a knowing violation of law;

	•	the payment of dividends or the redemption or purchase of stock in violation of Delaware law; or

	•	any transaction from which the director derived an improper personal benefit.

As permitted by Section 102(b)(7) of the DGCL, our Certificate of Incorporation contains a provision that provides for such limitation of liability. The effect of this provision is to restrict our rights and the rights of our stockholders in derivative suits to recover monetary damages against a director for breach of fiduciary duty as a director.

Section 145 of the DGCL provides that a corporation may indemnify directors and officers as well as other employees and individuals against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with any threatened, pending or completed actions, suits or proceedings in which such person is made a party by reason of such person being or having been a director, officer, employee or agent of the Company, subject to certain limitations. The DGCL provides that Section 145 is not exclusive of other rights to which those seeking indemnification may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors or otherwise. As permitted by Section 145 of the DGCL, our By-laws provide that the Company has the power, under specified circumstances, to indemnify its directors, officers, employees and agents in connection with actions, suits or proceedings brought against them by a third party or in the right of the Company, by reason of the fact that they were or are such directors, officers, employees or agents, against expenses incurred in any such action, suit or proceeding.

In addition, the Company has entered into separate indemnification agreements with certain of its directors and officers that provide indemnification to its directors and officers under certain circumstances for acts or omissions, which may not be covered by directors and officers liability insurance, and may, in some cases, be broader than the specific indemnification provisions contained under Delaware law. The Company also maintains standard policies of insurance under which coverage is provided to its directors and officers to insure against certain liabilities that such persons may incur in their capacities as directors and officers of the Company.

To the extent that our directors, officers and controlling persons are indemnified under the provisions contained in our Certificate of Incorporation, Delaware law or contractual arrangements against liabilities arising under the Securities Act, we have been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

Issuance of Stock

No shares of stock of the Company will be issued unless authorized by our board of directors, which authorization will include the maximum number of shares to be issued and the consideration to be received for each share.

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Provisions of Our Certificate of Incorporation and By-laws, Rights Plan and Delaware Law that May Have an Anti-Takeover Effect

Certificate of Incorporation and By-laws

Certain provisions in our Certificate of Incorporation and By-laws summarized below may be deemed to have an anti-takeover effect and may delay, deter or prevent a tender offer or takeover attempt that a stockholder might consider to be in its best interests, including attempts that might result in a premium being paid over the market price for the shares held by stockholders.

Classified Board of Directors. Our Certificate of Incorporation provides that the number of directors is fixed by our board of directors. Other than directors elected by the holders of any series of preferred stock or any other series or class of stock (except common stock), our directors are divided into three classes. Each class consists as nearly as possible of an equal number of directors. Currently, the terms of office for the three classes of directors expire, respectively, at our annual meetings in 2006, 2007 and 2008. The term of the successors of each class of directors expires three years from the year of election. Directors elected by stockholders at an annual meeting of stockholders will be elected by a plurality of all votes cast. To amend or repeal the provisions providing for our classified board of directors in our Certificate of Incorporation and By-laws, the affirmative vote of the holders of at least 75% of the then outstanding shares of capital stock entitled to vote is required.

Special Meetings. Our Certificate of Incorporation and By-laws provide that a special meeting of stockholders may be called only by the Chairman of the Board, the President, our board of directors, the holders of not less than a majority of all of the outstanding shares of the corporation entitled to vote at the meeting or, at any time that Ormat Industries (or a certain transferee of Ormat Industries) owns at least 20% of the then outstanding shares of our common stock, by Ormat Industries (or such transferee). Stockholders are not permitted to call, or to require that the board of directors call, a special meeting of stockholders. Moreover, the business permitted to be conducted at any special meeting of stockholders is limited to the business brought before the meeting pursuant to the notice of the meeting given by us. Our By-laws establish an advance notice procedure for stockholders to nominate candidates for election as directors or to bring other business before meetings of our stockholders.

The foregoing proposed provisions of our Certificate of Incorporation and By-laws could discourage potential acquisition proposals and could delay or prevent a change in control. These provisions are intended to enhance the likelihood of continuity and stability in the composition of the board of directors and in the policies formulated by the board of directors and to discourage certain types of transactions that may involve an actual or threatened change of control. These provisions are designed to reduce our vulnerability to an unsolicited acquisition proposal. The provisions also are intended to discourage certain tactics that may be used in proxy fights. However, such provisions could have the effect of discouraging others from making tender offers for our shares and, as a consequence, they also may inhibit fluctuations in the market price of our common stock that could result from actual or rumored takeover attempts. Such provisions also may have the effect of preventing changes in our management.

Rights Plan

Pursuant to our rights agreement with American Stock Transfer & Trust Company, as rights agent, each holder of our common stock has the right (which we refer to, collectively, as the "rights") to purchase one one-hundredth of a share of Series A Junior Participating Preferred Stock for each share of common stock owned by each such holder for $80.00, subject to adjustment. Our rights initially trade with, and are inseparable from, our common stock. Our rights are evidenced only by certificates that represent shares of our common stock. New rights will accompany any new shares of common stock we issue until the date on which the rights are distributed as described below. The rights will generally become exercisable ten days following a public announcement that a person or group of affiliated or associated persons (which we refer to as an "acquiring person") has acquired beneficial ownership of 15% or more of the voting power of all of our outstanding capital stock or ten

40

business days, or such later date as may be determined by our board of directors prior to such time as any person or group becomes an acquiring person, following the commencement of, or announcement of an intention to make, a tender offer or exchange offer the consummation of which would result in the beneficial ownership by a person or group of 15% or more of the voting power of all of our outstanding capital stock. In the event that, at any time after a person has become an acquiring person, we are acquired in a merger or other business combination transaction or 50% or more of our consolidated assets or earning power is sold, proper provision will be made so that each holder of rights will thereafter have the right to receive, upon the exercise thereof, at the then current exercise price of the rights, that number of shares of common stock of the acquiring company which at the time of such transaction will have a market value of two times the exercise price of the rights. In the event that any person becomes an acquiring person, proper provision shall be made so that each holder of rights, other than the rights beneficially owned by the acquiring person, which will thereafter be void, will have the right to receive upon exercise, instead of shares of Series A Junior Participating Preferred Stock, that number of shares of common stock having a market value of two times the exercise price of the rights. The rights have the right to vote once exercised, expire in 2014 and may be redeemed by us, at the discretion of our board of directors, in whole, but not in part, at a price of $.001 per right at any time prior to the acquisition by a person or group of affiliated or associated persons of beneficial ownership of 15% or more of the voting power of all of our outstanding capital stock, unless extended.

We cannot redeem shares of Series A Junior Participating Preferred Stock purchasable upon the exercise of the rights. Each share of Series A Junior Participating Preferred Stock will be entitled to a minimum preferential quarterly dividend payment of $1 per share but will be entitled to an aggregate dividend of 100 times the dividend declared per share of common stock whenever such dividend is declared. In the event of liquidation, the holders of Series A Junior Participating Preferred Stock will be entitled to a minimum preferential liquidation payment of $100 per share but will be entitled to an aggregate payment of 100 times the payment made per share of common stock. Each share of Series

A Junior Participating Preferred Stock will have 100 votes, voting together with the holders of the common stock. In the event of any merger, consolidation or other transaction in which shares of common stock are exchanged, each share of Series A Junior Participating Preferred Stock will be entitled to receive 100 times the amount received per share of common stock.

Our board of directors may adjust the purchase price of Series A Junior Participating Preferred Stock, the number of shares of Series A Junior Participating Preferred Stock issuable, and the number of our outstanding rights to prevent dilution that may occur from a stock dividend, a stock split or a reclassification of our Series A Junior Participating Preferred Stock. No adjustments to the purchase price of our Series A Junior Participating Preferred Stock of less than 1% will be made.

The purpose of the rights plan is to encourage potential acquirors to negotiate with our board of directors prior to attempting a takeover and to give the board leverage in negotiating on behalf of the stockholders the terms of any proposed takeover. The rights are intended to have anti-takeover effects. If the rights become exercisable, the rights will cause substantial dilution to a person or group that attempts to acquire or merge with us in most circumstances. Accordingly, the existence of the rights plan may deter a potential acquiror from making a takeover proposal or tender offer for an outstanding common stock. The rights should not interfere with any merger or other business combination approved by our board of directors as we may redeem the rights as described below and since a transaction approved by our board of directors would not cause the rights to become exercisable.

The terms of our rights agreement may be amended by our board of directors without the consent of the holders of our rights. After a person or group becomes an acquiring person, our board of directors may not amend the agreement in a way that adversely affects holders of our rights.

    Delaware Takeover Statute

We are subject to Section 203 of the Delaware General Corporation Law, which, subject to certain exceptions, prohibits a Delaware corporation from engaging in any ‘‘business combination’’ (as

41

defined below) with any ‘‘interested stockholder’’ (as defined below) for a period of three years following the date that such stockholder became an interested stockholder, unless: (1) prior to such date, the board of directors of the corporation approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder; (2) on consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding those shares owned (x) by persons who are directors and also officers and (y) by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or (3) on or subsequent to such date, the business combination is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock that is not owned by the interested stockholder.

Section 203 of the Delaware General Corporation Law defines ‘‘business combination’’ to include: (1) any merger or consolidation involving the corporation and the interested stockholder; (2) any sale, transfer, pledge or other disposition of 10% or more of the assets of the corporation involving the interested stockholder; (3) subject to certain exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder; (4) any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder; or (5) the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation. In general, Section 203 defines an ‘‘interested stockholder’’ as any entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation and any entity or person affiliated with or controlling or controlled by such entity or person.

Listing

Our common stock is quoted on the New York Stock Exchange under the trading symbol ‘‘ORA.’’

Transfer Agent

Our registrar and transfer agent for all common stock is American Stock Transfer & Trust Company, 58 Maiden Lane, New York, New York 10038.

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 DESCRIPTION OF WARRANTS WE MAY OFFER 

The following information outlines the material provisions of each warrant agreement, the warrants and the warrant certificates. This information is only a summary and is qualified entirely by reference to the relevant warrant agreement with respect to the warrants of any particular series. The specific terms of any series of warrants will be described in the relevant prospectus supplement. If so described in a prospectus supplement, the terms of that series of warrants may differ from the general description of terms presented below.

General

We may issue warrants for the purchase of our debt securities or common stock. Warrants may be issued independently or together with debt securities or common stock, and may be attached to or separate from those securities.

Each series of warrants will be evidenced by certificates issued under a separate warrant agreement to be entered into between us and a bank, as warrant agent, selected by us with respect to such series, having its principal office in the U.S. and having combined capital and surplus of at least $50,000,000.

The relevant prospectus supplement relating to a series of warrants will mention the name and address of the warrant agent. The relevant prospectus supplement will describe the terms of the warrant agreement and the series of warrants in respect of which this prospectus is being delivered, including:

	•	the title of such warrants;

	•	the offering price and aggregate number of warrants offered;

	•	the currency in which the price of such warrants will be payable;

	•	the designation and terms of the securities with which the warrants are issued and the number of warrants issued with each such security or each principal amount of such security;

	•	the date which the warrants and the related securities will be separately transferable;

	•	in the case of warrants to purchase debt securities, the principal amount of debt securities that can be purchased upon exercise of one warrant, and the price and currency for purchasing those debt securities upon exercise and, in the case of warrants to purchase common stock, the number of shares of common stock that can be purchased upon the exercise of one warrant, and the price and currency for purchasing such shares upon exercise;

	•	the terms of any rights to redeem or call or accelerate the expiration of the warrants;

	•	the dates on which the right to exercise the warrants will commence and expire and, if the warrants are not continuously exercisable, any dates on which the warrants are not exercisable;

	•	certain federal income tax consequences of holding or exercising those warrants;

	•	whether the warrants or related securities will be listed on any securities exchange;

	•	the terms of the securities issuable upon exercise of those warrants;

	•	whether the warrants will be issued in global or certificated form; and

	•	any other specific terms, preferences or rights of, or limitations or restrictions on, of the warrants.

Warrant certificates may be exchanged for new warrant certificates of different denominations, may be presented for transfer registration, and may be exercised at the warrant agent’s corporate trust office or any other office indicated in the relevant prospectus supplement. If the warrants are not separately transferable from the securities with which they were issued, this exchange may take place only if the certificates representing such related securities are also exchanged. Prior to warrant

43

exercise, warrantholders will not have any rights as holders of the securities purchasable upon such exercise, including, in the case of warrants to purchase debt securities, the right to receive principal, premium, if any, or interest payments, on the debt securities purchasable upon such exercise or to enforce covenants in the applicable indenture or, in the case of warrants to purchase any common stock, the right to receive any dividends, or payments upon any liquidation, dissolution or winding up of the Company or to exercise any voting rights.

Where appropriate, the applicable prospectus supplement will describe the U.S. federal income tax considerations relevant to the warrants.

Exercise of Warrants

Each warrant will entitle the holder to purchase the securities specified in the relevant prospectus supplement at the exercise price mentioned in, or calculated as described in, the relevant prospectus supplement. Unless otherwise specified in the relevant prospectus supplement, warrants may be exercised at any time up to 5:00 p.m., New York time, on the expiration date mentioned in that prospectus supplement. After the close of business on the expiration date, unexercised warrants will become void.

Warrants may be exercised by delivery of the warrant certificate representing the warrants to be exercised, or in the case of global securities by delivery of an exercise notice for those warrants, together with certain information, and payment to the warrant agent in immediately available funds, as provided in the relevant prospectus supplement, of the required purchase amount. The information required to be delivered will be on the reverse side of the warrant certificate and in the relevant prospectus supplement. Upon receipt of such payment and the warrant certificate or exercise notice properly executed at the warrant agent’s corporate trust office or any other office indicated in the relevant prospectus supplement, we will, in the time period the relevant warrant agreement provides, issue and deliver the securities purchasable upon such exercise. If fewer than all of the warrants represented by such warrant certificate are exercised, a new warrant certificate will be issued for the remaining amount of warrants.

If mentioned in the relevant prospectus supplement, securities may be surrendered as all or part of the exercise price for warrants.

Antidilution Provisions

In the case of warrants to purchase shares of our common stock, the exercise price payable and the number of shares of our common stock to be purchased upon warrant exercise may be adjusted in certain events, including:

	•	the issuance of a stock dividend to holders of our common stock or a combination, subdivision or reclassification of common stock;

	•	the issuance of rights, warrants or options to all holders of common stock entitling them to purchase common stock for an aggregate consideration per share less than the current market price per common stock share;

	•	any distribution to our common stockholders of evidences of our indebtedness or of assets, excluding cash dividends or distributions referred to above; and

	•	any other events mentioned in the relevant prospectus supplement.

No adjustment in the number of shares purchasable upon warrant exercise will be required until cumulative adjustments require an adjustment of at least 1% of such number. No fractional shares will be issued upon warrant exercise, but we will pay the cash value of any fractional shares otherwise issuable.

Modification

We and the relevant warrant agent may amend any warrant agreement and the terms of the related warrants by executing a supplemental warrant agreement, without any such warrantholder’s consent, for the purpose of:

44

	•	curing any ambiguity, any defective or inconsistent provision contained in the warrant agreement, or making any other corrections to the warrant agreement that are not inconsistent with the provisions of the warrant certificates and which do not adversely affect the warrant holders’ interests or rights in any material respect;

	•	evidencing the succession of another corporation to Ormat and their assumption of Ormat’s covenants contained in the warrant agreement and the warrants;

	•	appointing a successor depositary, if the warrants are issued in the form of global securities; evidencing a successor warrant agent’s acceptance of appointment with respect to the warrants;

	•	adding to our covenants for the warrantholders’ benefit or surrendering any right or power conferred upon us under the warrant agreement; or

	•	issuing warrants in definitive form, if such warrants are initially issued in the form of global securities.

We and the warrant agent may also amend any warrant agreement and the related warrants by a supplemental agreement with the consent of the holders of a majority of the unexercised warrants such amendment affects, for the purpose of adding, modifying or eliminating any of the warrant agreement’s provisions or of modifying the holders’ rights. However, no such amendment that

	•	changes the number or amount of securities purchasable upon warrant exercise so as to reduce the number of securities receivable upon this exercise;

	•	shortens the time period during which the warrants may be exercised;

	•	otherwise adversely affects the exercise rights of such warrantholders in any material respect; or

	•	reduces the number of unexercised warrants the consent of holders of which is required for amending the warrant agreement or the related warrants may be made without the consent of each holder affected by that amendment.

Consolidation, Merger and Sale of Assets

Each warrant agreement will provide that we are generally permitted to consolidate or merge with another company or firm. We are also permitted to sell or lease substantially all of our assets to another company or firm, or to buy or lease substantially all of the assets of another company or firm. However, we may not take any of these actions unless the following conditions, among others, are met:

	•	Where we merge out of existence or sell or lease substantially all our assets, the other company or firm must be a corporation, partnership or trust organized under the laws of a State of the United States or the District of Columbia or under United States federal law, and it must agree to be legally responsible for the warrants.

	•	The consolidation, merger, sale of assets or other transaction must not cause a default on the warrants, and we must not already be in default, unless the transaction would cure the default. For purposes of this no-default test, a default would include an event of default that has occurred and not been cured. A default for this purpose would also include any event that would be an event of default if the requirements for giving us notice of our default or our default having to exist for a specific period of time were disregarded.

Enforceability of Rights by Holders of Warrants

Each warrant agent will act solely as our agent under the relevant warrant agreement and will not assume any obligation or relationship of agency or trust for any warrantholder. A single bank or trust company (so long as it otherwise qualifies under the warrant agreement to act as warrant agent) may act as warrant agent for more than one issue of warrants. A warrant agent will have no duty or

45

responsibility in case we default in performing our obligations under the relevant warrant agreement or warrant, including any duty or responsibility to initiate any legal proceedings or to make any demand upon us. Any warrantholder may, without the warrant agent’s consent or of any other warrantholder, enforce by appropriate legal action its right to exercise, and receive the securities purchasable upon exercise of, that warrant.

Replacement of Warrant Certificates

We will replace any destroyed, lost, stolen or mutilated warrant certificate upon delivery to us and the relevant warrant agent of evidence satisfactory to them of the ownership of that warrant certificate and of the destruction, loss, theft or mutilation of that warrant certificate, and (in the case of mutilation) surrender of that warrant certificate to the relevant warrant agent, unless we or the warrant agent has received notice that the warrant certificate has been acquired by a bona fide purchaser. That warrantholder will also be required to provide indemnity satisfactory to the relevant warrant agent and us before a replacement warrant certificate will be issued.

Title

We, the warrant agents and any of their agents may treat the registered holder of any warrant certificate as the absolute owner of the warrants evidenced by that certificate for any purpose and as the person entitled to exercise the rights attaching to the warrants so requested, despite any notice to the contrary.

 DESCRIPTION OF UNITS WE MAY OFFER 

The following summarizes the material provisions of the units that we may issue from time to time and which are important to holders of units. The applicable prospectus supplement will state whether any of the generalized provisions summarized below do not apply to the units being offered and it will provide any additional provisions applicable to the units being offered, including their tax treatment. The following description is only a summary and is subject to, and qualified in its entirety by reference to the terms and provisions of the form of unit agreement to be filed as an exhibit to the registration statement which contains this prospectus.

We may issue units comprised of one or more of the other securities described in this prospectus in any combination. Each unit may also include debt obligations of third parties, such as U.S. Treasury securities. Each unit will be issued so that the holder of the unit is also the holder of each security included in the unit. Thus, the holder of a unit will have the rights and obligations of a holder of each included security. The unit agreement under which a unit is issued may provide that the securities included in the unit may not be held or transferred separately, at any time or at any time before a specified date.

The applicable prospectus supplement may describe:

	•	the designation and terms of the units and of the securities comprising the units, including whether and under what circumstances those securities may be held or transferred separately;

	•	any provisions for the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the units;

	•	whether the units will be issued in fully registered or global form; and

	•	any other terms of the unit agreements.

 PLAN OF DISTRIBUTION 

We may offer and sell the securities from time to time as follows:

	•	to or through underwriters or dealers;

	•	directly to other purchasers;

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	•	through designated agents; or

	•	through a combination of any of these methods of sale.

In addition, we may issue the securities as a dividend or distribution or in a subscription rights offering to our existing security holders. In some cases, we or dealers acting with us or on our behalf may also purchase securities and reoffer them to the public by one or more of the methods described above. This prospectus may be used in connection with any offering of our securities through any of these methods or other methods described in the applicable prospectus supplement.

If we offer securities in a subscription rights offering to our existing security holders, we may enter into a standby underwriting agreement with dealers, acting as standby underwriters. We may pay the standby underwriters a commitment fee for the securities they commit to purchase on a standby basis. If we do not enter into a standby underwriting arrangement, we may retain a dealer-manager to manage a subscription rights offering for us.

Any underwriter or agent involved in the offer and sale of the securities will be named in the applicable prospectus supplement.

In some cases, we may also repurchase the securities and reoffer them to the public by one or more of the methods described above. This prospectus and the applicable prospectus supplement may be used in connection with any offering of securities through any of these methods or other methods described in the applicable prospectus supplement.

The securities, including securities issued or to be issued by us or securities borrowed from third parties in connection with arrangements under which we agree to issue securities to underwriters or their affiliates on a delayed or contingent basis, that we distribute by any of these methods may be sold to the public, in one or more transactions, at:

	•	a fixed price or prices, which may be changed;

	•	market prices prevailing at the time of sale;

	•	prices related to prevailing market prices; or

	•	negotiated prices.

This prospectus may be delivered by underwriters and dealers in connection with short sales undertaken to hedge exposures under commitments to acquire securities of us to be issued on a delayed or contingent basis.

We may solicit, or may authorize underwriters, dealers or agents to solicit, offers to purchase securities directly from the public from time to time, including pursuant to contracts that provide for payment and delivery on future dates. We may also designate agents from time to time to solicit offers to purchase securities from the public on our behalf. The prospectus supplement relating to any particular offering of securities will name any agents designated to solicit offers, and will include information about any commissions we may pay the agents and will describe the material terms of any such delayed delivery arrangements, in that offering. Agents may be deemed to be ‘‘underwriters’’ as that term is defined in the Securities Act.

In connection with the sale of securities, underwriters may receive compensation from us or from purchasers of the securities, for whom they may act as agents, in the form of discounts, concessions or commissions. Underwriters may sell the securities to or through dealers, and such dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions from the purchasers for whom they may act as agents. Underwriters, dealers and agents that participate in the distribution of the securities may be deemed to be underwriters, and any discounts or commissions they receive from us, and any profit on the resale of the securities they realize may be deemed to be underwriting discounts and commissions under the Securities Act. Any such underwriter, dealer or agent will be identified, and any such compensation received will be described, in the applicable prospectus supplement.

We may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus

47

supplement so indicates, in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third party may use securities pledged by us or borrowed from us or others to settle those sales or to close out any related open borrowings of stock, and may use securities received from us in settlement of those derivatives to close out any related open borrowings of stock. The third party in such sale transactions will be an underwriter and will be identified in the applicable prospectus supplement or a post-effective amendment.

Unless otherwise specified in the applicable prospectus supplement, each series of the securities will be a new issue with no established trading market, other than the common stock. Any shares of common stock sold pursuant to a prospectus supplement will be trading on the New York Stock Exchange, subject to official notice of issuance. We may elect to list any of the other securities on an exchange, but are not obligated to do so. It is possible that one or more underwriters may make a market in a series of the securities, but will not be obligated to do so and may discontinue any market making at any time without notice. Therefore, no assurance can be given as to the liquidity of the trading market for the securities.

If dealers are utilized in the sale of the securities, we will sell the securities to the dealers as principals. The dealers may then resell the securities to the public at varying prices to be determined by such dealers at the time of resale. The names of the dealers and the terms of the transaction will be set forth in the applicable prospectus supplement.

We may enter into agreements with underwriters, dealers and agents who participate in the distribution of the securities which may entitle these persons to indemnification by us against certain liabilities, including liabilities under the Securities Act, or to contribution with respect to payments which such underwriters, dealers or agents may be required to make. Any agreement in which we agree to indemnify underwriters, dealers and agents against civil liabilities will be described in the applicable prospectus supplement.

If so indicated in the applicable prospectus supplement, we will authorize underwriters or other persons acting as our agents to solicit offers by certain purchasers to purchase the securities from us at the public offering price stated in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on a future date. These contracts will be subject to only those conditions stated in the prospectus supplement, and the prospectus supplement will state the commission payable to the solicitor of such offers.

We have not authorized any dealer, salesperson or other person to give any information or represent anything not contained in this prospectus. You must not rely on any unauthorized information. This prospectus does not constitute an offer to sell or solicit an offer to buy any securities in any jurisdiction where the offer or sale is not permitted.

Underwriters, dealers and agents, and their respective affiliates and associates, may engage in transactions with or perform services for us, or be customers of ours, in the ordinary course of business.

 VALIDITY OF SECURITIES 

Unless otherwise indicated in the applicable prospectus supplement, the validity of the securities offered hereby will be passed upon for us by Chadbourne & Parke LLP, New York, New York.

 EXPERTS 

The financial statements incorporated in this prospectus by reference to the Annual Report on Form 10-K/A for the year ended December 31, 2004 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.

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$1,000,000,000

Ormat Technologies, Inc.

Senior Debt Securities
Subordinated Debt Securities
Common Stock
Warrants and
Units

PART II INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14.    Other Expenses of Issuance and Distribution*

SEC registration fee				$107,000
Accounting fees and expenses				$100,000
Legal fees and expenses				$350,000
Printing and engraving fees and expenses				$27,000
Trustee fees and expenses				$20,000
Miscellaneous				$46,000
Total				$650,000

*	All fees and expenses other than the SEC registration fee are estimated.

Item 15.    Indemnification of Directors and Officers

Incorporated by reference to the disclosure under ‘‘Description of Common Stock We May Offer —Limitations on Directors’ and Officers’ Liability’’ in Part I of this Registration Statement on Form S-3.

Item 16.    Exhibits

No.	Exhibits

1.1	Form of Underwriting Agreement for senior and subordinated debt securities.*

1.2	Form of Underwriting Agreement for Common Stock.*

1.3	Form of Underwriting Agreement for Units.*

3.1	Second Amended and Restated Certificate of Incorporation, incorporated by reference to Exhibit 3.1 to Amendment No. 2 to our Registration Statement on Form S-1 (File No. 333-117527).

3.2	Second Amended and Restated By-laws, incorporated by reference to Exhibit 3.2 to Amendment No. 2 to our Registration Statement on Form S-1 (File No. 333-117527).

4.1	Form of Common Share Stock Certificate, incorporated by reference to 4.1 to our Registration Statement on Form S-1 (File No. 333-117527).

4.2	Indenture for Senior Debt Securities.

4.3	Indenture for Subordinated Debt Securities.

4.4	Form of Senior Debt Security (included in Exhibit 4.2).

4.5	Form of Subordinated Debt Security (included in Exhibit 4.3).

4.6	Form of Warrant Agreement (including form of warrant certificate).*

4.7	Form of Unit Agreement (including form of unit certificate).*

4.8	Form of Rights Agreement by and between Ormat Technologies, Inc. and American Stock Transfer & Trust Company, incorporated by reference to Exhibit 4.3 to Amendment No. 2 to our Registration Statement on Form S-1 (File No. 333-117527).

5.1	Opinion of Chadbourne & Parke LLP.

12.1	Statement of Computation of Ratios of Earnings to Fixed Charges.

23.1	Consent of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm.

II-1

23.2	Consent of Chadbourne & Parke LLP (included in Exhibit 5.1).

24.1	Powers of Attorney (included on signature page of Part II of this Registration Statement).

25.1	Statement of Eligibility of Trustee on Form T-1 under the Trust Indenture Act of 1939, as amended, of Union Bank of California, N.A. to act as trustee under the Senior Debt Indenture for the Senior Debt Securities.

25.2	Statement of Eligibility of Trustee on Form T-1 under the Trust Indenture Act of 1939, as amended, of Union Bank of California, N.A. to act as trustee under the Subordinated Debt Indenture for the Subordinated Debt Securities.

*	To be filed by amendment or as an exhibit to a document to be incorporated by reference into this Registration Statement in connection with an offering of these particular securities.

Item 17.    Undertakings

(a) The undersigned registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

	(i)	To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

	(ii)	To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the ‘‘Calculation of Registration Fee’’ table in the effective registration statement;

	(iii)	To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;

provided, however, that paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the SEC by the registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.

(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(4) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:

	(i)	Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

II-2

	(ii)	Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.

(5) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

	(i)	Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; and

	(ii)	Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

(b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted against the registrant by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

II-3

(d) The undersigned registrant hereby undertakes to file an application for the purpose of determining the eligibility of the trustee to act under subsection (a) of Section 310 of the Trust Indenture Act in accordance with the rules and regulations prescribed by the Commission under Section 305(b)(2) of the Act.

II-4

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Ormat Technologies, Inc. certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Sparks, Nevada, on the 17^th day of January, 2006.

ORMAT TECHNOLOGIES, INC.

By:     /s/ Yehudit Bronicki
Name:Yehudit Bronicki
Title:   Chief Executive Officer,
            President and Director

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Lucien Bronicki and Yehudit Bronicki, and each of them individually (with full power to each of them to act alone), as his or her true and lawful attorney-in-fact and agent, with full power of substitution and re-substitution, for him or her and in his or her name, place and stead, in any and all capacities, to do any and all things and execute any and all instruments that such attorney may deem necessary or advisable to comply with the Securities Act of 1933, as amended, and any rules, regulations and requirements of the Securities and Exchange Commission in connection with the registration of these securities of the registrant, including to sign this Registration Statement and any and all amendments (including post-effective amendments) or supplements thereto, and to file such Registration Statement and any and all such amendments or supplements, with all exhibits thereto, and other documents in connection therewith (including any related subsequent registration statement filed pursuant to Rule 462(b) under the Securities Act of 1933), with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing necessary or advisable to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed below by the following persons in the capacities and on the dates indicated:

Signature		Title		Date
/s/ Yehudit Bronicki		Chief Executive Officer, President     (Principal Executive Officer) and     Director		January 17, 2006
Yehudit Bronicki
/s/ Joseph Tenne		Chief Financial Officer (Principal     Financial and Accounting Officer)		January 17, 2006
Joseph Tenne
/s/ Lucien Bronicki		Chairman of the Board of Directors     and Chief Technology Officer		January 17, 2006
Lucien Bronicki
/s/ Yoram Bronicki		Chief Operating Officer – North     America and Director		January 17, 2006
Yoram Bronicki
/s/ Dan Falk		Director		January 17, 2006
Dan Falk

II-5

Signature		Title		Date
/s/ Roger W. Gale		Director		January 17, 2006
Roger W. Gale
		Director		January     , 2006
Elon Kohlberg
/s/ Jacob J. Worenklein		Director		January 17, 2006
Jacob J. Worenklein

II-6

EXHIBIT INDEX

	No.				Exhibits
	1.1			Form of Underwriting Agreement for senior and subordinated debt securities.*
	1.2			Form of Underwriting Agreement for Common Stock.*
	1.3			Form of Underwriting Agreement for Units.*
	3.1			Second Amended and Restated Certificate of Incorporation, incorporated by reference to Exhibit 3.1 to Amendment No. 2 to our Registration Statement on Form S-1 (File No. 333-117517).
	3.2			Second Amended and Restated By-laws, incorporated by reference to Exhibit 3.2 to Amendment No. 2 to our Registration Statement on Form S-1 (File No. 333-117527).
	4.1			Form of Common Share Stock Certificate, incorporated by regerence to Exhibit 4.1 to our Registration Statement on Form S-1 (File No. 333-117527).
	4.2			Indenture for Senior Debt Securities.
	4.3			Indenture for Subordinated Debt Securities.
	4.4			Form of Senior Debt Security (included in Exhibit 4.2).
	4.5			Form of Subordinated Debt Security (included in Exhibit 4.3).
	4.6			Form of Warrant Agreement (including form of warrant certificate).*
	4.7			Form of Unit Agreement (including form of unit certificate).*
	4.8			Form of Rights Agreement by and between Ormat Technologies, Inc. and American Stock Transfer & Trust Company, incorporated by reference to Exhibit 4.3 to Amendment No. 2 to our Registration Statement on Form S-1 (File No. 333-117527).
	5.1			Opinion of Chadbourne & Parke LLP.
	12.1			Statement of Computation of Ratios of Earnings to Fixed Charges.
	23.1			Consent of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm.
	23.2			Consent of Chadbourne & Parke LLP (included in Exhibit 5.1).
	24.1			Powers of Attorney (included on signature page of Part II of this Registration Statement).
	25.1			Statement of Eligibility of Trustee on Form T-1 under the Trust Indenture Act of 1939, as amended, of Union Bank of California, N.A. to act as trustee under the Senior Debt Indenture for the Senior Debt Securities.
	25.2			Statement of Eligibility of Trustee on Form T-1 under the Trust Indenture Act of 1939, as amended, of Union Bank of California, N.A. to act as trustee under the Subordinated Debt Indenture for the Subordinated Debt Securities.

*	To be filed by amendment or as an exhibit to a document to be incorporated by reference into this Registration Statement in connection with an offering of these particular securities.

EX-4.2

                                                                     EXHIBIT 4.2

================================================================================



                            ORMAT TECHNOLOGIES, INC.

                                       TO

                         UNION BANK OF CALIFORNIA, N.A.
                                     Trustee





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

                                    INDENTURE

                          Dated as of January 16, 2006

                             SENIOR DEBT SECURITIES

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




================================================================================






                            Ormat Technologies, Inc.
     Reconciliation and tie between Trust Indenture Act of 1939, as amended,
                   and Indenture, dated as of January 16, 2006


Trust Indenture Act
Section                                                        Indenture Section

Section 310 (a)(1)   ........................................  609
            (a)(2)   ........................................  609
            (a)(3)   ........................................  Not Applicable
            (a)(4)   ........................................  Not Applicable
            (b)      ........................................  608
                                                               610
Section 311 (a)      ........................................  613
            (b)      ........................................  613
Section 312 (a)      ........................................  701
                                                               702 (a)
            (b)      ........................................  702 (b)
            (c)      ........................................  702 (a)
Section 313 (a)      ........................................  703 (a)
            (b)      ........................................  703 (a), 703 (b)
            (c)      ........................................  703 (a)
            (d)      ........................................  703 (b)
Section 314 (a)      ........................................  704
            (a)(4)   ........................................  101
                                                               1004
            (b)      ........................................  Not Applicable
            (c)(1)   ........................................  102
            (d)(2)   ........................................  102
            (c)(3)   ........................................  Not Applicable
            (d)      ........................................  Not Applicable
            (e)      ........................................  102
Section 315 (a)      ........................................  601
            (b)      ........................................  602
            (c)      ........................................  601
            (d)      ........................................  601
            (e)      ........................................  514
Section 316 (a)      ........................................  101
            (a)(1)(A)........................................  502
                                                               512
            (a)(1)(B)........................................  513
            (a)(2)   ........................................  Not Applicable



            (b)      ........................................  508
            (c)      ........................................  104
Section 317 (a)(1)   ........................................  503
            (a)(2)   ........................................  504
            (b)      ........................................  1003
Section 318 (a)      ........................................  107

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

NOTE:   This reconciliation and tie shall not, for any purpose, be deemed to be
        a part of the Indenture.






                                TABLE OF CONTENTS


                                                                            Page

ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF
GENERAL APPLICATION............................................................1

Section 101.  Definitions......................................................1
Section 102.  Compliance Certificates and Opinions.............................8
Section 103.  Form of Documents Delivered to Trustee...........................9
Section 104.  Acts of Holders; Record Dates....................................9
Section 105.  Notices, Etc., to Trustee and Company...........................12
Section 106.  Notice to Holders; Waiver.......................................12
Section 107.  Conflict with Trust Indenture Act...............................13
Section 108.  Effect of Headings and Table of Contents........................13
Section 109.  Successors and Assigns..........................................13
Section 110.  Separability Clause.............................................13
Section 111.  Benefits of Indenture...........................................13
Section 112.  Governing Law; Submission to Jurisdiction.......................13
Section 113.  Legal Holidays..................................................14

ARTICLE TWO SECURITY FORMS....................................................14

Section 201.  Forms Generally.................................................14
Section 202.  Form of Face of Security........................................15
Section 203.  Form of Reverse of Security.....................................17
Section 204.  Form of Legend for Global Securities............................21
Section 205.  Form of Trustee's Certificate of Authentication.................21

ARTICLE THREE THE SECURITIES..................................................22

Section 301.  Amount Unlimited; Issuable in Series............................22
Section 302.  Denominations...................................................25
Section 303.  Execution, Authentication, Delivery and Dating..................26
Section 304.  Temporary Securities............................................28
Section 305.  Registration, Registration of Transfer and Exchange.............28
Section 306.  Mutilated, Destroyed, Lost and Stolen Securities................30
Section 307.  Payment of Interest; Interest Rights Preserved..................31
Section 308.  Persons Deemed Owners...........................................32
Section 309.  Cancellation....................................................33
Section 310.  Computation of Interest.........................................33

ARTICLE FOUR SATISFACTION AND DISCHARGE.......................................34

Section 401.  Satisfaction and Discharge of Indenture.........................34
Section 402.  Application of Trust Money......................................35


                                       -i-


ARTICLE FIVE REMEDIES.........................................................35

Section 501.  Events of Default...............................................35
Section 502.  Acceleration of Maturity; Rescission and Annulment..............37
Section 503.  Collection of Indebtedness and Suits for Enforcement
                by Trustee....................................................39
Section 504.  Trustee May File Proofs of Claim................................39
Section 505.  Trustee May Enforce Claims Without Possession of Securities.....40
Section 506.  Application of Money Collected..................................40
Section 507.  Limitation on Suits.............................................41
Section 508.  Unconditional Right of Holders to Receive Principal,
                Premium and Interest..........................................41
Section 509.  Restoration of Rights and Remedies..............................42
Section 510.  Rights and Remedies Cumulative..................................42
Section 511.  Delay or Omission Not Waiver....................................42
Section 512.  Control by Holders..............................................42
Section 513.  Waiver of Past Defaults.........................................43
Section 514.  Undertaking for Costs...........................................43
Section 515.  Waiver of Stay or Extension Laws................................44

ARTICLE SIX THE TRUSTEE.......................................................44

Section 601.  Certain Duties and Responsibilities.............................44
Section 602.  Notice of Defaults..............................................44
Section 603.  Certain Rights of Trustee.......................................45
Section 604.  Not Responsible for Recitals or Issuance of Securities..........46
Section 605.  May Hold Securities.............................................46
Section 606.  Money Held in Trust.............................................46
Section 607.  Compensation and Reimbursement..................................46
Section 608.  Disqualification; Conflicting Interests.........................47
Section 609.  Corporate Trustee Required; Eligibility.........................47
Section 610.  Resignation and Removal; Appointment of Successor...............48
Section 611.  Acceptance of Appointment by Successor..........................49
Section 612.  Merger, Conversion, Consolidation or Succession to Business.....51
Section 613.  Preferential Collection of Claims Against Company...............51
Section 614.  Appointment of Authenticating Agent.............................51

ARTICLE SEVEN HOLDERS' LISTS AND REPORTS
BY TRUSTEE AND COMPANY........................................................53

Section 701.  Company to Furnish Trustee Names and Addresses of Holders.......53
Section 702.  Preservation of Information; Communications to Holders..........53
Section 703.  Reports by Trustee..............................................54
Section 704.  Reports by Company..............................................54

ARTICLE EIGHT CONSOLIDATION, MERGER, CONVEYANCE,
TRANSFER OR LEASE.............................................................55


                                      -ii-


Section 801.  Company May Consolidate, Etc., Only on Certain Terms............55
Section 802.  Successor Person Substituted....................................56

ARTICLE NINE SUPPLEMENTAL INDENTURES..........................................57

Section 901.  Supplemental Indentures without Consent of Holders..............57
Section 902.  Supplemental Indentures with Consent of Holders.................58
Section 903.  Execution of Supplemental Indentures............................59
Section 904.  Effect of Supplemental Indentures...............................60
Section 905.  Conformity with Trust Indenture Act.............................60
Section 906.  Reference in Securities to Supplemental Indentures..............60

ARTICLE TEN COVENANTS.........................................................60

Section 1001. Payment of Principal, Premium and Interest......................60
Section 1002. Maintenance of Office or Agency.................................60
Section 1003. Money for Securities Payments to Be Held in Trust...............61
Section 1004. Corporate Existence.............................................62
Section 1005. [Reserved]......................................................62
Section 1006. Statement by Officers as to Default.............................62
Section 1007. Waiver of Certain Covenants.....................................63
Section 1008. Calculation of Original Issue Discount..........................63

ARTICLE ELEVEN REDEMPTION OF SECURITIES.......................................63

Section 1101. Applicability of Article........................................63
Section 1102. Election to Redeem; Notice to Trustee...........................63
Section 1103. Selection by Trustee of Securities to Be Redeemed...............63
Section 1104. Notice of Redemption............................................63
Section 1105. Deposit of Redemption Price.....................................63
Section 1106. Securities Payable on Redemption Date...........................63
Section 1107. Securities Redeemed in Part.....................................63

ARTICLE TWELVE SINKING FUNDS..................................................63

Section 1201. Applicability of Article........................................63
Section 1202. Satisfaction of Sinking Fund Payments with Securities...........63
Section 1203. Redemption of Securities for Sinking Fund.......................63

ARTICLE THIRTEEN DEFEASANCE AND COVENANT DEFEASANCE...........................63

Section 1301. Applicability of Article; Company's Option to Effect
                Defeasance or Covenant Defeasance.............................63
Section 1302. Defeasance and Discharge........................................63
Section 1303. Covenant Defeasance.............................................63
Section 1304. Conditions to Defeasance or Covenant Defeasance.................63


                                      -iii-


Section 1305. Deposited Money and U.S. Government Obligations to be Held
                in Trust; Other Miscellaneous Provisions......................63
Section 1306. Reinstatement...................................................63

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

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



                                      -iv-


          INDENTURE, dated as of January 16, 2006, between Ormat Technologies,
Inc., a Delaware corporation (herein called the "Company"), having its principal
office at 980 Greg Street, Sparks, Nevada 89431, and Union Bank of California,
N.A., a national banking association, as Trustee (herein called the "Trustee").

                                    RECITALS

          The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its direct, unsecured
and unsubordinated debentures, notes or other evidences of indebtedness (herein
called the "Securities"), to be issued in one or more series as in this
Indenture provided.

          All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.

          NOW, THEREFORE, THIS INDENTURE WITNESSETH:

          For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:


                                   ARTICLE ONE

                        Definitions and Other Provisions
                             of General Application

Section 101. Definitions.

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

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

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

          (3) all accounting terms not otherwise defined herein have the
     meanings assigned to them in accordance with generally accepted accounting
     principles, and, except as otherwise herein expressly provided, the term
     "generally accepted accounting principles" with respect to any computation
     required or




     permitted hereunder shall mean such accounting principles as are generally
     accepted at the date of such computation;

          (4) unless the context otherwise requires, any reference to an
     "Article" or a "Section" refers to an Article or a Section, as the case may
     be, of this Indenture; and

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

          (6) references to "dollar", "dollars" and "$" are to United States
     dollars.

          "Act", when used with respect to any Holder, has the meaning specified
in Section 104.

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

          "Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.

          "Board of Directors" means any of the board of directors of the
Company or any duly authorized committee of that board or any officer of the
Company, to which authority to act on behalf of the Board of Directors has been
duly delegated.

          "Board Resolution" means a copy of a resolution certified by the
Secretary or Assistant Secretary of the Company to have been duly adopted by the
Board of Directors or any duly authorized committee of that board or any officer
of the Company, to which authority to act on behalf of the Board of Directors
has been duly delegated, and to be in full force and effect on the date of such
certification, and delivered to the Trustee.

          "Business Day", when used with respect to any Place of Payment, means
each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which


                                      -2-


banking institutions in that Place of Payment are authorized or obligated by law
or executive order to close.

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

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

          "Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Deputy
Chairman, its President or any Vice President, its Treasurer or Assistant
Treasurer, or its Secretary or any Assistant Secretary, and delivered to the
Trustee.

          "Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office at the date hereof is located at 350 California
Street, 11th Floor, San Francisco, CA 94101.

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

          "Covenant Defeasance" has the meaning specified in Section 1303.

          "Defaulted Interest" has the meaning specified in Section 307.

          "Defeasance" has the meaning specified in Section 1302.

          "Depositary" means, with respect to the Securities of any series
issuable or issued in whole or in part in the form of one or more Global
Securities, the clearing agency registered under the Exchange Act specified for
that purpose as contemplated by Section 301.

          "Event of Default" has the meaning specified in Section 501.

          "Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.


                                      -3-


          "Expiration Date" has the meaning specified in Section 104.

          "Global Security" means a Security that evidences all or part of the
Securities of any series and bears the legend set forth in Section 204 (or such
legend as may be specified as contemplated by Section 301 for such Securities).

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

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

          "interest", when used with respect to an Original Issue Discount
Security which by its terms bears interest only after Maturity, means interest
payable after Maturity at the rate prescribed in such Original Issue Discount
Security.

          "Interest Payment Date", when used with respect to any Security, means
the Stated Maturity of an installment of interest on such Security.

          "Investment Company Act" means the U.S. Investment Company Act of 1940
and any statute successor thereto, in each case as amended from time to time.

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

          "Notice of Default" means a written notice of the kind specified in
Section 501(4).

          "Officers' Certificate" means a certificate signed by the Chairman of
the Board, its Deputy Chairman, the Chief Executive Officer, the President or
any Vice President, or the Secretary or any Assistant Secretary of the Company,
and delivered to the Trustee. One of the officers signing an Officers'
Certificate given pursuant to Section 1006 shall be the principal executive,
financial or accounting officer of the Company.



                                      -4-


          "Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company.

          "Original Issue Discount Security" means any Security which provides
for an amount less than the principal amount thereof to be due and payable upon
a declaration of acceleration of the Maturity thereof pursuant to Section 502.

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

          (1) Securities theretofore cancelled by the Trustee or delivered to
     the Trustee for cancellation;

          (2) Securities for whose payment or redemption money in the necessary
     amount has been theretofore deposited with the Trustee or any Paying Agent
     (other than the Company) in trust or set aside and segregated in trust by
     the Company (if the Company shall act as its own Paying Agent) for the
     Holders of such Securities; provided that, if such Securities are to be
     redeemed, notice of such redemption has been duly given pursuant to this
     Indenture or provision therefor satisfactory to the Trustee has been made;

          (3) Securities as to which Defeasance has been effected pursuant to
     Section 1302; and

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

provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, (i) the principal amount of an Original Issue
Discount Security which shall be deemed to be Outstanding shall be the amount of
the principal thereof which would be due and payable as of such date upon
acceleration of the Maturity thereof pursuant to Section 502, (ii) if, as of
such date, the principal amount payable at the Stated Maturity of a Security is
not determinable, the principal amount of such Security which shall be deemed to
be Outstanding shall be the amount as specified or determined as contemplated by
Section 301, (iii) the principal amount of a Security denominated in one or more
foreign


                                      -5-


currencies or currency units which shall be deemed to be Outstanding shall be
the U.S. dollar equivalent, determined as of such date in the manner provided as
contemplated by Section 301, of the principal amount of such Security (or, in
the case of a Security described in Clause (i) or (ii) above) of the amount
determined as provided in such Clause, and (iv) Securities owned by the Company
or any other obligor upon the Securities of any Affiliate of the Company or of
such other obligor shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent, waiver or other
action, only Securities which the Trustee knows to be so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or of such other obligor.

          "Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Securities on behalf of
the Company.

          "Periodic Offering" means an offering of Securities of a series from
time to time the specific terms of which Securities, including, without
limitation, the rate or rates of interest or formula for determining the rate or
rates of interest thereon, if any, the Stated Maturity or Maturities thereof and
the redemption provisions, if any, with respect thereto, are to be determined by
the Company upon the issuance of such Securities.

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

          "Place of Payment", when used with respect to the Securities of any
series, means the place or places where the principal of (and premium, if any)
and interest on the Securities of that series are payable as specified as
contemplated by Section 301.

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

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


                                      -6-


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

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

          "Responsible Officer", when used with respect to the Trustee, means
the chairman or any vice-chairman of the board of directors, the chairman or any
vice-chairman of the executive committee of the board of directors, the chairman
of the trust committee, the president, any vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any trust officer or assistant trust officer, the controller
or any assistant controller or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.

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

          "Securities Act" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time.

          "Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.

          "Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.

          "Stated Maturity", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security as the fixed date on which the principal of such Security or
such installment of principal or interest is due and payable.

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



                                      -7-


          "Trust Indenture Act" means the U.S. Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.

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

          "U.S. Government Obligations" has the meaning specified in Section
1304.

          "Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".

Section 102. Compliance Certificates and Opinions.

          (a) Upon any application or request by the Company to the Trustee to
take any action under any provision of this Indenture, the Company shall furnish
to the Trustee:

          (1) an Officers' Certificate in form and substance reasonably
     satisfactory to the Trustee stating that, in the opinion of the signer all
     conditions precedent, if any, provided for in this Indenture relating to
     the proposed action have been complied with; and

          (2) an Opinion of Counsel in form and substance reasonably
     satisfactory to the Trustee stating that, in the opinion of such counsel,
     all conditions precedent have been complied with.

          (b) Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (except for certificates
provided for in Section 1006) shall include:

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



                                      -8-


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

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

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

Section 103. Form of Documents Delivered to Trustee.

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

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

Section 104. Acts of Holders; Record Dates.



                                      -9-


          (a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided or permitted by this Indenture to be given, made
or taken by Holders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.

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

          (c) The ownership of Securities shall be proved by the Security
Register.

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

          (e) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities of such series, provided that the
Company may not set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next paragraph. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other Holders,
shall be entitled to take the


                                      -10-


relevant action, whether or not such Holders remain Holders after such record
date; provided that no such action shall be effective hereunder unless taken on
or prior to the applicable Expiration Date by Holders of the requisite principal
amount of Outstanding Securities of such series on such record date. Nothing in
this paragraph shall be construed to prevent the Company from setting a new
record date for any action for which a record date has previously been set
pursuant to this paragraph (whereupon the record date previously set shall
automatically and with no action by any Person be cancelled and of no effect),
and nothing in this paragraph shall be construed to render ineffective any
action taken by Holders of the requisite principal amount of Outstanding
Securities of the relevant series on the date such action is taken. Promptly
after any record date is set pursuant to this paragraph, the Company, at its own
expense, shall cause notice of such record date, the proposed action by Holders
and the applicable Expiration Date to be given to the Trustee in writing and to
each Holder of Securities of the relevant series in the manner set forth in
Section 106.

          (f) The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to join
in the giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 502, (iii) any request to institute
proceedings referred to in Section 507(2) or (iv) any direction referred to in
Section 512, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date; provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Trustee, at the Company's expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 106.

          (g) With respect to any record date set pursuant to this Section, the
party hereto which sets such record dates may designate any day as the
"Expiration Date" and from time to time may change the Expiration Date to any
earlier or later day; provided that no such change shall be effective unless
notice of the proposed new Expiration Date is given to the other party hereto in
writing, and to each Holder of


                                      -11-


Securities of the relevant series in the manner set forth in Section 106, on or
prior to the existing Expiration Date. If an Expiration Date is not designated
with respect to any record date set pursuant to this Section, the party hereto
which set such record date shall be deemed to have initially designated the
180th day after such record date as the Expiration Date with respect thereto,
subject to its right to change the Expiration Date as provided in this
paragraph.

          (h) Without limiting the foregoing, a Holder entitled hereunder to
take any action hereunder with regard to any particular Security may do so with
regard to all or any part of the principal amount of such Security or by one or
more duly appointed agents each of which may do so pursuant to such appointment
with regard to all or any part of such principal amount.

Section 105. Notices, Etc., to Trustee and Company.

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

          (1) the Trustee by any Holder or by the Company shall be sufficient
     for every purpose hereunder if made, given, furnished or filed in writing
     to or with the Trustee at its Corporate Trust Office, Attention: Corporate
     Trust Department, or

          (2) the Company by the Trustee or by any Holder shall be sufficient
     for every purpose hereunder (unless otherwise herein expressly provided) if
     in writing and mailed, first-class postage prepaid, to the Company
     addressed to it at the address of its principal office specified in the
     first paragraph of this instrument or at any other address previously
     furnished in writing to the Trustee by the Company, Attention: President.

Section 106. Notice to Holders; Waiver.

          (a) Where this Indenture provides for notice to Holders 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 Holder
affected by such event, at his address as it appears in the Security Register,
not later than the latest date (if any), and not earlier than the earliest date
(if any), prescribed for the giving of such notice. In any case where notice to
Holders is given by mail, neither the failure to mail such notice, nor any
defect in any notice so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders. Where this Indenture
provides for notice in any manner, such notice may be waived in writing by the
Person entitled to receive such


                                      -12-


notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.

          (b) In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.

Section 107. Conflict with Trust Indenture Act.

          If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act which is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act which may be so modified or excluded, the latter provision shall
be deemed to apply to this Indenture as so modified or excluded, as the case may
be.

Section 108. 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 109. Successors and Assigns.

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

Section 110. Separability Clause.

          In case any provision in this Indenture or in the Securities 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.

Section 111. Benefits of Indenture.

          Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this Indenture.

          Section 112. Governing Law; Submission to Jurisdiction.



                                      -13-


          (a) This Indenture and the Securities shall be governed by and
construed in accordance with the laws of the State of New York, without regard
to its principles of conflicts of laws.

          (b) The Company agrees that any judicial proceedings instituted in
relation to any matter arising under this Indenture or the Securities
appertaining thereto may be brought in any United States Federal or New York
State court sitting in the Borough of Manhattan, The City of New York, New York
to the extent that such court has subject matter jurisdiction over the
controversy, and, by execution and delivery of this Indenture, the Company
hereby irrevocably accepts, generally and unconditionally, the jurisdiction of
the aforesaid courts, acknowledges their competence and irrevocably agrees to be
bound by any judgment rendered in such proceeding.

Section 113. Legal Holidays.

          In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security or any other specified date with respect to any
Security shall not be a Business Day at any Place of Payment, then
(notwithstanding any other provision of this Indenture or of the Securities
(other than a provision of any Security which specifically states that such
provision shall apply in lieu of this Section)) payment of interest or principal
(and premium, if any) need not be made at such Place of Payment on such date,
but may be made on the next succeeding Business Day at such Place of Payment
with the same force and effect as if made on the Interest Payment Date,
Redemption Date, at the Stated Maturity or such other specified date, provided
that no interest, principal or premium (if any) shall accrue with respect to
such payment, for the period from and after such Interest Payment Date,
Redemption Date, Stated Maturity or such other specified date, as the case may
be. However, if such next succeeding Business Day is in the next succeeding
calendar month or calendar year, as applicable, such payment will be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such Interest Payment Date, Redemption Date, Stated Maturity or
otherwise.


                                   ARTICLE TWO

                                 Security Forms

Section 201. Forms Generally.

          (a) The Securities of each series shall be in substantially the form
set forth in this Article, or in such other form as shall be established by or
pursuant to a Board Resolution or in one or more indentures supplemental hereto,
in each case with such appropriate insertions, omissions, substitutions and
other variations as are required


                                      -14-


or permitted by this Indenture, and may have such letters, numbers or other
marks of identification and such legends or endorsements placed thereon as may
be required to comply with the rules of any securities exchange or Depositary
therefor or as may, consistently herewith, be determined by the officers
executing such Securities, as evidenced by their execution thereof. If the form
of Securities of any series is established by action taken pursuant to a Board
Resolution, a copy of an appropriate record of such action shall be certified by
the Secretary or an Assistant Secretary of the Company and delivered to the
Trustee at or prior to the delivery of the Company Order contemplated by Section
303 for the authentication and delivery of such Securities.

          (b) The Trustee's certificates of authentication shall be in
substantially the form set forth in this Article.

          (c) The definitive Securities shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers executing such Securities, as evidenced by their
execution of such Securities.

Section 202. Form of Face of Security.

          [Insert any legend required by the Internal Revenue Code and the
regulations thereunder.]


                            ORMAT TECHNOLOGIES, INC.

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

No.___________                                                      $___________

          Ormat Technologies, Inc., a Delaware corporation (herein called the
"Company", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
_________________________ or registered assigns, the principal sum of
__________________________ Dollars on ________________________________ [If the
Security is to bear interest prior to Maturity, insert --, and to pay interest
thereon from ______________________ or from the most recent Interest Payment
Date to which interest has been paid or duly provided for, semi-annually on
___________________ and ___________________in each year, commencing
_________________________, at the rate of ___ % per annum, until the principal
hereof is paid or made available for payment [If applicable, insert --, provided
that any principal and premium, and any such installment of interest, which is
overdue shall bear interest at the rate of ___% per annum (to the extent that
the payment of such interest shall be legally enforceable), from the dates such
amounts are due until they are paid or made available for payment, and such
interest shall be payable on demand]. The


                                      -15-


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 ________________or ________________ (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date. 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]. [If the Security is not to bear
interest prior to Maturity, insert -- The principal of this Security shall not
bear interest except in the case of a default in payment of principal upon
acceleration, upon redemption or at Stated Maturity and in such case the overdue
principal and any overdue premium shall bear interest at the rate of ___ % per
annum (to the extent that the payment of such interest shall be legally
enforceable), from the dates such amounts are due until they are paid or made
available for payment. Interest on any overdue principal or premium shall be
payable on demand.] [If applicable, insert -- Any such interest on overdue
principal or premium which is not paid on demand shall bear interest at the rate
of ___ % per annum (to the extent that the payment of such interest on interest
shall be legally enforceable), from the date of such demand until the amount so
demanded is paid or made available for payment. Interest on any overdue interest
shall be payable on demand.]

          Payment of the principal of (and premium, if any) and [if applicable,
insert -- any such] interest on this Security will be made at the office or
agency of the Company maintained for that purpose in______________, 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 [if applicable, insert -- ;
provided, however, that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register].

          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 referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.


                                      -16-



          IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.

Dated: _______


                                                ORMAT TECHNOLOGIES, INC.



                                                --------------------------------
                                                Authorized Signatory

Section 203. 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 a Senior Debt Securities Indenture, dated as of January 16, 2006
(herein called the "Indenture", which term shall have the meaning assigned to it
in such instrument), between the Company and Union Bank of California, N.A., as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture), and reference is hereby made to the Indenture 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 [if
applicable, insert --, limited in aggregate principal amount to $___________].

          [If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice, [if applicable, insert -- (1) on
________ in any year commencing with the year _______ and ending with the year
________ through operation of the sinking fund for this series at a Redemption
Price equal to 100% of the principal amount, and (2)] at any time [if
applicable, insert -- on or after ______, 20__], as a whole or in part, at the
election of the Company, at the following Redemption Prices (expressed as
percentages of the principal amount): If redeemed [if applicable, insert -- on
or before_________, __%, and if redeemed] during the 12-month period beginning
_______ of the years indicated.

                       Redemption                         Redemption
        Year              Price             Year             Price
   --------------    --------------    --------------   --------------




and thereafter at a Redemption Price equal to ___ % of the principal amount,
together in the case of any such redemption [if applicable, insert -- (whether
through operation of the


                                      -17-


sinking fund or otherwise)] with accrued interest to the Redemption Date, but
interest installments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the relevant
Record Dates referred to on the face hereof, all as provided in the Indenture.]


          [If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, (1) on ___________ in any
year commencing with the year ___ and ending with the year _____ through
operation of the sinking fund for this series at the Redemption Prices for
redemption through operation of the sinking fund (expressed as percentages of
the principal amount) set forth in the table below, and (2) at any time [if
applicable, insert -- on or after ___________,] as a whole or in part, at the
election of the Company, at the Redemption Prices for redemption otherwise than
through operation of the sinking fund (expressed as percentages of the principal
amount) set forth in the table below: If redeemed during the 12-month period
beginning ___________ of the years indicated,

                                                       Redemption Price For
                                                       Redemption Otherwise
                        Redemption Price For              Than Through
                         Redemption Through             Operation of the
       Year        Operation of the Sinking Fund          Sinking Fund
   ------------    -----------------------------      -----------------------







and thereafter at a Redemption Price equal to ___ % of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest installments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the relevant
Record Dates referred to on the face hereof, all as provided in the Indenture.]

          [If applicable, insert -- Notwithstanding the foregoing, the Company
may not, prior to ____________, redeem any Securities of this series as
contemplated by [if applicable, insert -- Clause 2 of] the preceding paragraph
as a part of, or in anticipation of, any refunding operation by the application,
directly or indirectly, of moneys borrowed having an interest cost to the
Company (calculated in accordance with generally accepted financial practice) of
less than __% per annum.]



                                      -18-


          [If applicable, insert -- The sinking fund for this series provides
for the redemption on ___________ in each year beginning with the year
___________ and ending with the year ___________ of [if applicable, insert --
not less than] $____ [("mandatory sinking fund") and not more than $ _______]
aggregate principal amount of Securities of this series. [Securities of this
series acquired or redeemed by the Company otherwise than through [if
applicable, insert -- mandatory] sinking fund payments may be credited against
subsequent [mandatory] sinking fund payments otherwise required to be made -- in
the inverse order in which they become due.]

          [If the Security is subject to redemption of any kind, insert -- In
the event of redemption of this Security in part only, a new Security or
Securities of this series and of a like tenor for the unredeemed portion hereof
will be issued in the name of the Holder hereof upon the cancellation hereof.]

          [If the Security is not subject to redemption, insert -- This Security
is not redeemable prior to Stated Maturity.]

          [The Indenture contains provisions for defeasance at any time of [the
entire indebtedness of this Security or] [certain restrictive covenants and
Events of Default with respect to this Security] [, in each case] upon
compliance with certain conditions set forth therein.]

          [If the Security is not an Original Issue Discount Security, insert --
If an Event of Default with respect to Securities of this series shall occur and
be continuing, the principal of the Securities of this series may be declared
due and payable in the manner and with the effect provided in the Indenture.]

          [If the Security is an Original Issue Discount Security, insert -- If
an Event of Default with respect to Securities of this series shall occur and be
continuing, an amount of principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to -- insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal, premium and 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 premium and interest, if any, on the Securities of this series
shall terminate.]

          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 majority of the Holders in principal amount of the Securities at
the time Outstanding of each series to


                                      -19-


be affected. The Indenture also contains provisions permitting the Holders of
specified percentages 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 compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and binding
upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange herefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security.

          As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity. The foregoing
shall not apply to any suit instituted by the Holder of this Security for the
enforcement of any payment of principal hereof or any premium or interest hereon
on or after the respective due dates expressed herein.

          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 any premium, 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 any
premium 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 and of like tenor, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.



                                      -20-


          The Securities of this series are issuable only in registered form
without coupons in denominations of $ ________ 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 and of like tenor of a different
authorized denomination, as requested by the Holder surrendering the same.

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

          Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the 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.

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

Section 204. Form of Legend for Global Securities.

          Unless otherwise specified as contemplated by Section 301 for the
securities evidenced thereby, every Global Security authenticated and delivered
hereunder shall bear a legend in substantially the following form:

          "This Security is a Global Security within the meaning of the
          Indenture hereinafter referred to and is registered in the name of a
          Depositary or a nominee thereof. This Security may not be exchanged in
          whole or in part for a Security registered, and no transfer of this
          Security in whole or in part may be registered in the name of any
          Person other than such Depositary or a nominee thereof, except in the
          limited circumstances described in the Indenture."

Section 205. Form of Trustee's Certificate of Authentication.

          The Trustee's certificates of authentication shall be in substantially
the following form:

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



                                      -21-


                                              UNION BANK OF CALIFORNIA, N.A.,

                                                 as Trustee

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


                                  ARTICLE THREE

                                 The Securities

Section 301. Amount Unlimited; Issuable in Series.

          (a) The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.

          (b) The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 303,
set forth, or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of any series,

          (1) the title of the Securities of the series (which shall distinguish
     the Securities of the series from Securities of any other series);

          (2) any limit upon the aggregate principal amount of the Securities of
     the series which may be authenticated and delivered under this Indenture
     (except for Securities authenticated and delivered upon registration of
     transfer of, or in exchange for, or in lieu of, other Securities of the
     series pursuant to Section 304, 305, 306, 906 or 1107 and except for any
     Securities which, pursuant to Section 303, are deemed never to have been
     authenticated and delivered hereunder);

          (3) the Person to whom any interest on a Security of the series shall
     be payable, if other than the Person in whose name that Security (or one or
     more Predecessor Securities) is registered at the close of business on the
     Regular Record Date for such interest;

          (4) the date or dates on which the principal of the Securities of the
     series is payable;

          (5) the rate or rates at which the Securities of the series shall bear
     interest, if any, the date or dates from which such interest shall accrue,
     the Interest


                                      -22-


     Payment Dates on which such interest shall be payable and the Regular
     Record Date for the interest payable on any Interest Payment Date;

          (6) the place or places where the principal of (and premium, if any)
     and interest on Securities of the series shall be payable;

          (7) the period or periods within which, the price or prices at which,
     and the terms and conditions upon which, Securities of the series may be
     redeemed, in whole or in part, at the option of the Company and, if other
     than by a Board Resolution, the manner in which any election by the Company
     to redeem the Securities shall be evidenced;

          (8) the obligation, if any, of the Company to redeem or purchase
     Securities of the series pursuant to any sinking fund or analogous
     provisions or at the option of a Holder thereof and the period or periods
     within which, the price or prices at which and the terms and conditions
     upon which, Securities of the series shall be redeemed or purchased, in
     whole or in part, pursuant to such obligation;

          (9) any provisions necessary to permit or facilitate the issuance,
     payment or conversion of any Securities of the series that may be converted
     into securities or other property (including shares of the Company's common
     or preferred shares or other securities of the Company) other than
     Securities of the same series and of like tenor, whether in addition to, or
     in lieu of, any payment of principal or other amount and whether at the
     option of the Company or otherwise;

          (10) if other than denominations of $1,000 and any integral multiple
     thereof, the denominations in which Securities of the series shall be
     issuable;

          (11) if other than the currency of the United States of America, the
     currency, currencies, composite currencies or currency units in which the
     principal of or any premium or interest on any Securities of the series
     shall be payable and the manner of determining the equivalent thereof in
     the currency of the United States of America for any purpose, including for
     purposes of the definition of "Outstanding" in Section 101;

          (12) if the principal of or any premium or interest on any Securities
     of the series is to be payable, at the election of the Company or the
     Holder thereof, in one or more currencies, composite currencies or currency
     units other than that or those in which such Securities are stated to be
     payable, the currency, currencies, composite currency, composite currencies
     or currency units in which the principal of or any premium or interest on
     such Securities as to which such election is made shall be payable, the
     periods within which and the terms and conditions upon


                                      -23-


     which such election is to be made and the amount so payable (or the manner
     in which such amount shall be determined);

          (13) if the amount of payments of principal of and any premium or
     interest on the Securities of the series may be determined with reference
     to an index, a formula or any other method, the manner in which such
     amounts shall be determined;

          (14) if other than the entire principal amount thereof, the portion of
     the principal amount of Securities of the series which shall be payable
     upon declaration of acceleration of the Maturity thereof pursuant to
     Section 502;

          (15) if the principal amount payable at the Stated Maturity of any
     Securities of the series will not be determinable as of any one or more
     dates prior to the Stated Maturity, the amount which shall be deemed to be
     the principal amount of such Securities as of any such date for any purpose
     thereunder or hereunder, including the principal amount thereof which shall
     be due and payable upon any Maturity other than the Stated Maturity or
     which shall be deemed to be Outstanding as of any date prior to the Stated
     Maturity (or, in any such case, the manner in which such amount deemed to
     be the principal amount shall be determined);

          (16) if applicable, that the Securities of the series, in whole or any
     specified part, shall be defeasible pursuant to Section 1302 or Section
     1303 or both such Sections and, if other than by a Board Resolution, the
     manner in which any election by the Company to defease such Securities
     shall be evidenced;

          (17) if applicable, that any Securities of the series shall be
     issuable in whole or in part in the form of one or more Global Securities
     and, in such case, the respective Depositaries for such Global Securities,
     the form of any legend or legends which shall be borne by any such Global
     Security in addition to or in lieu of that set forth in Section 204 and any
     circumstances in addition to or in lieu of those set forth in paragraph (h)
     of Section 305 in which any such Global Security may be exchanged in whole
     or in part for Securities registered, and any transfer of such Global
     Security in whole or in part may be registered, in the name or names of
     Persons other than the Depositary for such Global Security or a nominee
     thereof;

          (18) any addition to, elimination of, or other change in the Events of
     Default which applies to any Securities of the series and any change in the
     right of the Trustee or the requisite Holders of such Securities to declare
     the principal amount thereof due and payable pursuant to Section 502;



                                      -24-


          (19) any addition to, elimination of, or other change in the covenants
     set forth in Article Ten which applies to Securities of the series;

          (20) any proposed listing on any national or foreign securities
     exchange of the Securities of the series; and

          (21) any other terms of the series (which terms shall not be
     inconsistent with the provisions of this Indenture, except as permitted by
     Section 901(5)).

          (c) All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or pursuant
to the Board Resolution referred to above and (subject to Section 303) set
forth, or determined in the manner provided, in the Officers' Certificate
referred to in paragraph (a) above or in any such indenture supplemental hereto.

          (d) If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.

          (e) With respect to Securities of a series offered in a Periodic
Offering, the Board Resolution (or action taken pursuant thereto), Officers'
Certificate or supplemental indenture referred to above may provide general
terms or parameters for Securities of such series and provide either that the
specific terms of particular Securities of such series shall be specified in a
Company Order or that such terms shall be determined by the Company in
accordance with other procedures specified in a Company Order as contemplated by
Section 303(c).

          (f) Notwithstanding Section 301(b)(2) and unless otherwise expressly
provided with respect to a series of Securities, the aggregate principal amount
of a series of Securities may be increased and additional Securities of such
series may be issued up to the maximum aggregate principal amount authorized
with respect to such series as increased.

          (g) The Securities shall not be superior in right of payment to, and
shall rank pari passu with, any other direct, unsecured and unsubordinated
obligations of the Company.

Section 302. Denominations.



                                      -25-


          The Securities of each series shall be issuable in registered form
without coupons in such denominations as shall be specified as contemplated by
Section 301. In the absence of any such provisions with respect to the
Securities of any series, the Securities of such series shall be issuable in
denominations of $1,000 and any integral multiple thereof.

Section 303. Execution, Authentication, Delivery and Dating.

          (a) The Securities shall be executed on behalf of the Company by its
Chairman, its Deputy Chairman, its President or one of its Vice Presidents. The
signature of any of these officers on the Securities may be manual or facsimile.

          (b) Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.

          (c) At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Securities of any series executed by
the Company to the Trustee for authentication, together with a Company Order for
the authentication and delivery of such Securities, and the Trustee in
accordance with the Company Order shall authenticate and deliver such
Securities; provided, however, that in the case of Securities offered in a
Periodic Offering, the Trustee shall authenticate and deliver such Securities
from time to time in accordance with such other procedures (including, without
limitation, the receipt by the Trustee of oral or electronic instructions from
the Company or its duly authorized agents, promptly confirmed in writing)
acceptable to the Trustee as may be specified by or pursuant to a Company Order
delivered to the Trustee prior to the time of the first authentication of
Securities of such series. If the form or terms of the Securities of the series
have been established in or pursuant to one or more Board Resolutions as
permitted by Sections 201 and 301, in authenticating such Securities, and
accepting the additional responsibilities under this Indenture in relation to
such Securities, the Trustee shall be entitled to receive, and (subject to
Section 601) shall be fully protected in relying upon, an Opinion of Counsel
stating:

          (1) if the form of such Securities has been established by or pursuant
     to Board Resolution as permitted by Section 201, that such form has been
     established in conformity with the provisions of this Indenture;

          (2) if the terms of such Securities have been, or in the case of
     Securities of a series offered in a Periodic Offering, will be, established
     by or


                                      -26-


     pursuant to a Board Resolution as permitted by Section 301, that such terms
     have been, or in the case of Securities of a series offered in a Periodic
     Offering, the manner of determining such terms have been, established in
     conformity with the provisions of this Indenture, subject, in the case of
     Securities of a series offered in a Periodic Offering, to any conditions
     specified in such Opinion of Counsel; and

          (3) that such Securities, when authenticated and delivered by the
     Trustee and issued by the Company in the manner and subject to any
     conditions specified in such Opinion of Counsel, will constitute valid and
     legally binding obligations of the Company, enforceable in accordance with
     their terms, subject to bankruptcy, insolvency, fraudulent transfer,
     reorganization, moratorium and similar laws of general applicability
     relating to or affecting the enforcement of creditors' rights and to
     general equity principles.

If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.

          (d) (i) Notwithstanding the provisions of Section 301 and of the
preceding paragraph, if all Securities of a series are not to be originally
issued at one time, it shall not be necessary to deliver the Officers'
Certificate otherwise required pursuant to Section 301 or the Company Order and
Opinion of Counsel otherwise required pursuant to such preceding paragraph at or
prior to the time of authentication of each Security of such series if such
documents are delivered at or prior to the time of authentication upon original
issuance of the first Security of such series to be issued.

          (ii) with respect to Securities of a series offered in a Periodic
Offering, the Trustee may rely, as to the authorization by the Company of any of
such Securities, the form and terms thereof and the legality, validity, binding
effect and enforceability thereof, upon the Opinion of Counsel and the other
documents delivered pursuant to Sections 201 and 301 and this Section, as
applicable, in connection with the first authentication of Securities of such
series.

          (e) Each Security shall be dated the date of its authentication.

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


                                      -27-


Notwithstanding the foregoing, if any Security shall have been authenticated and
delivered hereunder but never issued and sold by the Company, and the Company
shall deliver such Security to the Trustee for cancellation as provided in
Section 309 together with a written statement (which need not comply with
Section 102 and need not be accompanied by an Opinion of Counsel) stating that
such Security has never been issued and sold by the Company, for all purposes of
this Indenture such Security shall be deemed never to have been authenticated
and delivered hereunder and shall never be entitled to the benefits of this
Indenture.

Section 304. Temporary Securities.

          (a) Pending the preparation of definitive Securities of any series,
the Company may execute, and upon Company Order the Trustee shall authenticate
and deliver, temporary Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities.

          (b) If temporary Securities of any series are issued, the Company will
cause definitive Securities of that series to be prepared without unreasonable
delay. After the preparation of definitive Securities of such series, the
temporary Securities of such series shall be exchangeable for definitive
Securities of such series upon surrender of the temporary Securities of such
series at the office or agency of the Company in a Place of Payment for that
series, without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Securities of any series the Company shall execute and the
Trustee shall authenticate and deliver in exchange therefor a like principal
amount of definitive Securities of the same series and of a like tenor of
authorized denominations. Until so exchanged the temporary Securities of any
series shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities of such series and tenor.

Section 305. Registration, Registration of Transfer and Exchange.

          (a) The Company shall cause to be kept at the Corporate Trust Office
of the Trustee a register (the register maintained in such office and in any
other office or agency of the Company in a Place of Payment being herein
sometimes collectively referred to as the "Security Register") in which, subject
to such reasonable regulations as it may prescribe, the Company shall provide
for the registration of Securities and of transfers of Securities. The Trustee
is hereby appointed "Security Registrar" for the purpose of registering
Securities and transfers of Securities as herein provided.

                                      -28-


          (b) Upon surrender for registration of transfer of any Security of any
series at the office or agency in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
the same series, of any authorized denominations and of a like aggregate
principal amount and tenor.

          (c) At the option of the Holder, Securities of any series may be
exchanged for other Securities of the same series of any authorized
denominations and of a like aggregate principal amount and tenor, upon surrender
of the Securities to be exchanged at such office or agency. Whenever any
Securities are so surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Securities which the Holder making
the exchange is entitled to receive.

          (d) All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.

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

          (f) No service charge shall be made for any registration of transfer
or exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities, other
than exchanges pursuant to Section 304, 906 or 1107 not involving any transfer.

          (g) If the Securities of any series (or of any series and specified
tenor) are to be redeemed in part, the Company shall not be required (i) to
issue, register the transfer of or exchange Securities of any series during a
period beginning at the opening of business 15 days before the day of the
mailing of a notice of redemption of Securities of that series selected for
redemption under Section 1103 and ending at the close of business on the day of
such mailing, or (ii) to register the transfer of or exchange any Security so
selected for redemption in whole or in part, except the unredeemed portion of
any Security being redeemed in part.

          (h) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated for such Global Security or
a nominee thereof and delivered to such Depositary or a custodian therefor, and
each such


                                      -29-


Global Security shall constitute a single Security for all purposes of this
Indenture . Notwithstanding the foregoing, except as otherwise specified as
contemplated by Section 301, no Global Security shall be registered for transfer
or exchange, or authenticated or delivered, pursuant to this Section 305 or
Sections 304, 306, 906 or 1107 in the name of a Person other than the Depositary
for such Security or its nominee until (i) the Depositary with respect to a
Global Security notifies the Company that it is unwilling or unable to continue
as Depositary for such Global Security or the Depositary ceases to be a clearing
agency registered under the Exchange Act and the Company notifies the Trustee
that it is unable to locate a qualified successor Depositary, (ii) the Company
executes and delivers to the Trustee a Company Order that such Global Security
shall be so transferable and exchangeable or (iii) there shall have occurred and
be continuing an Event of Default with respect to the Securities of such series.
Upon the occurrence in respect of any Global Security of any series of any one
or more of the conditions specified in clauses (i), (ii) or (iii) of the
preceding sentence or such other conditions as may be specified as contemplated
by Section 301 for such series, such Global Security may be registered for
transfer or exchange for Securities registered in the names of, or authenticated
and delivered to, such Persons as the Depositary with respect to such series
shall direct.

          (i) Except as provided in the preceding paragraph, any Security
authenticated and delivered upon registration of transfer of, or in exchange
for, or in lieu of, any Global Security or any portion thereof, whether pursuant
to this Section, Section 304, 306, 906 or 1107 or otherwise, shall also be a
Global Security and bear the legend specified in Section 204. Notwithstanding
any other provision of this Indenture, a Global Security may not be transferred
except as a whole by the Depositary for such Global Security to a nominee of
such Depositary or to another Depositary or a nominee thereof or by a nominee of
such Depositary to such Depositary or another nominee of such Depositary or to
another Depositary or a nominee thereof.

Section 306. Mutilated, Destroyed, Lost and Stolen Securities.

          (a) If any mutilated Security is surrendered to the Trustee, the
Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.

          (b) If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Company or the Trustee that such Security has been acquired by a protected
purchaser, the Company shall execute and upon its request the Trustee shall
authenticate and deliver, in lieu of any such destroyed,


                                      -30-


lost or stolen Security, a new Security of the same series and of like tenor and
principal amount and bearing a number not contemporaneously outstanding.

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

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

          (e) Every new Security of any series issued pursuant to this Section
in lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of that series duly issued hereunder.

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

Section 307. Payment of Interest; Interest Rights Preserved.

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

          (b) Any interest on any Security of any series which is payable, but
is not punctually paid or duly provided for, on any Interest Payment Date
(herein called "Defaulted Interest") shall forthwith cease to be payable to the
Holder on the relevant Regular Record Date by virtue of having been such Holder,
and such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:

          (1) The Company may elect to make payment of any Defaulted Interest to
     the Persons in whose names the Securities of such series (or their
     respective Predecessor Securities) are registered at the close of business
     on a Special Record Date for the payment of such Defaulted Interest, which
     shall be


                                      -31-


     fixed in the following manner. The Company shall notify the Trustee in
     writing of the amount of Defaulted Interest proposed to be paid on each
     Security of such series and the date of the proposed payment, and at the
     same time the Company shall deposit with the Trustee an amount of money
     equal to the aggregate amount proposed to be paid in respect of such
     Defaulted Interest or shall make arrangements satisfactory to the Trustee
     for such deposit prior to the date of the proposed payment, such money when
     deposited to be held in trust for the benefit of the Persons entitled to
     such Defaulted Interest as in this Clause provided. Thereupon the Trustee
     shall fix a Special Record Date for the payment of such Defaulted Interest
     which shall be not more than 15 days and not less than 10 days prior to the
     date of the proposed payment and not less than 10 days after the receipt by
     the Trustee of the notice of the proposed payment. The Trustee shall
     promptly notify the Company of such Special Record Date and, in the name
     and at the expense of the Company, shall cause notice of the proposed
     payment of such Defaulted Interest and the Special Record Date therefor to
     be mailed, first-class postage prepaid, to each Holder of Securities of
     such series at such Holder's address as it appears in the Security
     Register, not less than 10 days prior to such Special Record Date. Notice
     of the proposed payment of such Defaulted Interest and the Special Record
     Date therefor having been so mailed, such Defaulted Interest shall be paid
     to the Persons in whose names the Securities of such series (or their
     respective Predecessor Securities) are registered at the close of business
     on such Special Record Date and shall no longer be payable pursuant to the
     following Clause (2).

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

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

Section 308. Persons Deemed Owners.

          (a) Prior to due presentment of a 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 such Security is registered as the owner of
such Security for the purpose of receiving payment of principal of (and premium,
if any) and (subject to


                                      -32-


Section 307) interest on such Security and for all other purposes whatsoever,
whether or not such Security be overdue, and neither the Company, the Trustee
nor any agent of the Company or the Trustee shall be affected by notice to the
contrary.

          (b) Notwithstanding the foregoing, with respect to any Global
Security, nothing herein shall prevent the Company, the Trustee, or any agent of
the Company or the Trustee, from giving effect to any written certification,
proxy or other authorization furnished by any depositary, as a Holder, with
respect to such Global Security or impair, as between such depositary and owners
of beneficial interests in such Global Security, the operation of customary
practices governing the exercise of the rights of such depositary as a Holder of
such Global Security.

          (c) None of the Company, the Trustee or any agent of the Company or
the Trustee shall have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests in a Global Security or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.

Section 309. Cancellation.

          All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly cancelled by it. The Company may at any time deliver to
the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery
to the Trustee) for cancellation any Securities previously authenticated
hereunder which the Company has not issued and sold, and all Securities so
delivered shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of in accordance with its
normal procedures unless otherwise directed by a Company Order.

Section 310. Computation of Interest.

          Except as otherwise specified as contemplated by Section 301 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.



                                      -33-


                                  ARTICLE FOUR

                           Satisfaction and Discharge

Section 401. Satisfaction and Discharge of Indenture.

          (a) This Indenture shall upon Company Request cease to be of further
effect with respect to any series of Securities (except as to any surviving
rights of registration of transfer or exchange of Securities of such series
herein expressly provided for), and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging satisfaction and discharge of
this Indenture as to such series, when:

          (1) either

          (A) all Securities of such series theretofore authenticated and
     delivered (other than (i) Securities of such series which have been
     destroyed, lost or stolen and which have been replaced or paid as provided
     in Section 306 and (ii) Securities of such series for whose payment money
     has theretofore been deposited in trust or segregated and held in trust by
     the Company and thereafter repaid to the Company or discharged from such
     trust, as provided in Section 1003) have been delivered to the Trustee for
     cancellation; or

          (B) all such Securities of such series not theretofore delivered to
     the Trustee for cancellation

               (i) have become due and payable, or

               (ii) will become due and payable at their Stated Maturity within
          one year, or

               (iii) are to be called for redemption within one year under
          arrangements satisfactory to the Trustee for the giving of notice of
          redemption by the Trustee in the name, and at the expense, of the
          Company,

          and the Company, in the case of (i), (ii) or (iii) above, has
          deposited or caused to be deposited with the Trustee as trust funds in
          trust for the purpose an amount sufficient to pay and discharge the
          entire indebtedness on the Securities of such series not theretofore
          delivered to the Trustee for cancellation, for principal (and premium,
          if any) and interest to the date of such deposit (in the case of
          Securities which have become due


                                      -34-


          and payable) or to the Stated Maturity or Redemption Date, as the case
          may be;

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

          (3) the Company has delivered to the Trustee an Officers' Certificate
     and an Opinion of Counsel, each stating that all conditions precedent
     herein provided for relating to the satisfaction and discharge of this
     Indenture with respect to the relevant series of Securities have been
     complied with.

          (b) Notwithstanding the satisfaction and discharge of this Indenture,
the obligations of the Company to the Trustee under Section 607, the obligations
of the Trustee to any Authenticating Agent under Section 614 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.

Section 402. Application of Trust Money.

          Subject to provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money has been deposited with the
Trustee.


                                  ARTICLE FIVE

                                    Remedies

Section 501. Events of Default.

          "Event of Default", wherever used herein with respect to Securities of
any series, 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):



                                      -35-


          (1) default in the payment of any interest upon any Security of that
     series when it becomes due and payable, and continuance of such default for
     a period of 30 days; or

          (2) default in the payment of the principal of (or premium, if any,
     on) any Security of that series at its Maturity; or

          (3) default in the deposit of any sinking fund payment, when and as
     due by the terms of a Security of that series; or

          (4) default in the performance, or breach, of any covenant or warranty
     of the Company in this Indenture (other than a covenant or warranty a
     default in whose performance or whose breach is elsewhere in this Section
     specifically dealt with or which has expressly been included in this
     Indenture solely for the benefit of a series of Securities other than that
     series), and continuance of such default or breach for a period of 60 days
     after there has been given, by registered or certified mail, to the Company
     by the Trustee or to the Company and the Trustee by the Holders of at least
     25% in principal amount of the Outstanding Securities of that series a
     written notice specifying such default or breach and requiring it to be
     remedied and stating that such notice is a "Notice of Default" hereunder;
     or

          (5) a default under any bond, debenture, note or other evidence of
     indebtedness for money borrowed by the Company (including a default with
     respect to Securities of any series other than that series) having an
     aggregate principal amount outstanding of at least $50,000,000, or under
     any mortgage, indenture or instrument (including this Indenture) under
     which there may be issued or by which there may be secured or evidenced any
     indebtedness for money borrowed by the Company having an aggregate
     principal amount outstanding of at least $50,000,000, whether such
     indebtedness now exists or shall hereafter be created, which default shall
     have resulted in such indebtedness becoming or being declared due and
     payable prior to the date on which it would otherwise have become due and
     payable, without such acceleration having been rescinded or annulled within
     a period of 10 days after there shall have been given, by registered or
     certified mail, to the Company by the Trustee or to the Company and the
     Trustee by the Holders of at least 10% in principal amount of the
     Outstanding Securities of that series a written notice specifying such
     default and requiring the Company to cause such acceleration to be
     rescinded or annulled and stating that such notice is a "Notice of Default"
     hereunder; provided, however, that, subject to the provisions of Sections
     601 and 602, the Trustee shall not be deemed to have knowledge of such
     default unless either (A) a Responsible Officer of the Trustee shall have
     actual knowledge of such default or (B) the Trustee shall have received
     written notice thereof from the Company, from any Holder, from


                                      -36-


     the holder of any such indebtedness or from the trustee under any mortgage,
     indenture or other instrument; or

          (6) the entry by a court having jurisdiction in the premises of (A) a
     decree or order for relief in respect of the Company in an involuntary case
     or proceeding under any applicable bankruptcy, insolvency, reorganization
     or other similar law or (B) a decree or order adjudging the Company a
     bankrupt or insolvent, or approving as properly filed a petition seeking
     reorganization, arrangement, adjustment or composition of or in respect of
     the Company under any applicable law, or appointing a custodian, receiver,
     liquidator, assignee, trustee, sequestrator or other similar official of
     the Company or of any substantial part of its property, or ordering the
     winding up or liquidation of its affairs, and the continuance of any such
     decree or order for relief or any such other decree or order unstayed and
     in effect for a period of 90 consecutive days; or

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

          (8) any other Event of Default provided with respect to Securities of
     that series.

Section 502. Acceleration of Maturity; Rescission and Annulment.

          (a) If an Event of Default (other than an Event of Default specified
in Section 501(6) or 501(7)) with respect to Securities of any series at the
time Outstanding occurs and is continuing, then and in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series may declare the principal amount (or, if
any of the Securities of that series are Original Issue Discount Securities,
such portion of the principal amount of such Securities as may be specified in


                                      -37-


the terms thereof) of all of the Securities of that series to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if given
by Holders), and upon any such declaration such principal amount (or specified
amount) shall become immediately due and payable. If an Event of Default
specified in Section 501(6) or 501(7) with respect to Securities of any series
at the time Outstanding occurs, the principal amount of all the Securities of
that series (or, if any Securities of that series are Original Issue Discount
Securities, such portion of the principal amount of such Securities as may be
specified by the terms thereof) shall automatically, and without any declaration
or other action on the part of the Trustee or any Holder, become immediately due
and payable.

          (b) At any time after such a declaration of acceleration with respect
to Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in principal amount of the
Outstanding Securities of that series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if

          (1) the Company has paid or deposited with the Trustee a sum
     sufficient to pay:

               (i) all overdue interest on all Securities of that series,

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

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

               (iv) all sums paid or advanced by the Trustee hereunder and the
          reasonable compensation, expenses, disbursements and advances of the
          Trustee, its agents and counsel;

     and

          (2) all Events of Default with respect to Securities of that series,
     other than the non-payment of the principal of Securities of that series
     which have become due solely by such declaration of acceleration, have been
     cured or waived as provided in Section 513.



                                      -38-


No such rescission shall affect any subsequent default or impair any right
consequent thereon.

Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee.

          (a) The Company covenants that if

          (1) default is made in the payment of any interest on any Security
     when such interest becomes due and payable and such default continues for a
     period of 30 days, or

          (2) default is made in the payment of the principal of (or premium, if
     any, on) any Security at the Maturity thereof,

the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal (and premium, if any) and interest and, to the extent
that payment of such interest shall be legally enforceable, interest on any
overdue principal (and premium, if any) and on any overdue interest, at the rate
or rates prescribed therefor in such Securities, 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 Trustee, its agents and counsel.

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

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

Section 504. Trustee May File Proofs of Claim.


                                      -39-


          (a) In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee shall be entitled and empowered, by intervention in such
proceeding or otherwise, to take any and all action authorized under the Trust
Indenture Act in order to have the claims of the Holders and the Trustee allowed
in any such proceeding. In particular, the Trustee shall be authorized to
collect and receive any moneys or other property payable or deliverable on any
such claims and to distribute the same; and any custodian, receiver, assignee,
trustee, liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 607.

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

Section 505. Trustee May Enforce Claims Without Possession of Securities.

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

Section 506. Application of Money Collected.

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

          FIRST: To the payment of all amounts due the Trustee under Section
607;



                                      -40-


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

          THIRD: The balance, if any, to the Company.

Section 507. Limitation on Suits.

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

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

          (2) the Holders of not less than 25% in principal amount of the
     Outstanding Securities of that series shall have made written request to
     the Trustee to institute proceedings in respect of such Event of Default in
     its own name as Trustee hereunder;

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

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

          (5) no direction inconsistent with such written request has been given
     to the Trustee during such 60-day period by the Holders of a majority in
     principal amount of the Outstanding Securities of that series;

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

Section 508. Unconditional Right of Holders to Receive Principal,
             Premium and Interest.



                                      -41-


          Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of (and premium, if any) and (subject to
Section 307) interest on such Security on the Stated Maturity or Maturities
expressed in such Security (or, in the case of redemption, on the Redemption
Date) and to institute suit for the enforcement of any such payment, and such
rights shall not be impaired without the consent of such Holder.

Section 509. Restoration of Rights and Remedies.

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

Section 510. Rights and Remedies Cumulative.

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

Section 511. Delay or Omission Not Waiver.

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

Section 512. Control by Holders.

          The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising


                                      -42-


any trust or power conferred on the Trustee, with respect to the Securities of
such series, provided that

          (1) such direction shall not be in conflict with any rule of law or
     with this Indenture,

          (2) the Trustee may take any other action deemed proper by the Trustee
     which is not inconsistent with such direction, and

          (3) subject to the provisions of Section 601, the Trustee shall have
     the right to decline to follow any such direction if the Trustee in good
     faith shall, by a Responsible Officer or Officers of the Trustee, determine
     that the proceeding so directed would involve the Trustee in personal
     liability, for which the security or indemnity offered pursuant to Section
     603(e) would not be sufficient.

Section 513. Waiver of Past Defaults.

          (a) Subject to Section 502, the Holders of not less than a majority in
principal amount of the Outstanding Securities of any series may, on behalf of
the Holders of all the Securities of such series, by notice to the Trustee,
waive an existing or past default with respect to the Securities of such series
and its consequences, except a default

          (1) in the payment of principal of (or premium, if any) or interest on
     any Security of such series, or in the deposit of any sinking fund payment
     when and as due, or

          (2) in respect of a covenant or provision hereof which under Article
     Nine cannot be modified or amended without the consent of the Holder of
     each Outstanding Security of such series affected.

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

Section 514. Undertaking for Costs.

          All parties to this Indenture agree, and each Holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and


                                      -43-


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 any suit
instituted by the Company.

Section 515. Waiver of Stay or Extension Laws.

          The Company 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, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.


                                   ARTICLE SIX

                                   The Trustee

Section 601. Certain Duties and Responsibilities.

          The duties and responsibilities of the Trustee shall be as provided by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.

Section 602. Notice of Defaults.

          If a default known to the Trustee occurs hereunder with respect to the
Securities of any series, the Trustee shall transmit by mail to all Holders of
Securities of such series, as their names and addresses appear in the Security
Register by the time required by the Trust Indenture Act, notice of such default
hereunder, unless such default shall have been cured or waived; provided,
however, that, in the case of any default of the character specified in Section
501(4) with respect to Securities of such series, no such notice to Holders
shall be given until at least 30 days after the occurrence thereof. For the
purpose of this Section, the term "default" means any event which is, or after
notice


                                      -44-


or lapse of time or both would become, an Event of Default with respect to
Securities of such series.

Section 603. Certain Rights of Trustee.

          Subject to the provisions of Section 601:

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

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

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

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

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

          (f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney;
and



                                      -45-


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

          (h) The Trustee shall not be deemed to have notice of a Default or an
Event of Default unless (a) the Trustee has received written notice thereof from
the Company or any Holder or (b) a Responsible Officer shall have actual
knowledge thereof; and

          (i) For the avoidance of doubt, permissive rights of the Trustee
designated as such and enumerated herein shall not be construed as duties.

Section 604. Not Responsible for Recitals or Issuance of Securities.

          The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Securities, except that
the Trustee represents that it is duly authorized to execute and deliver this
Indenture, authenticate the Securities and perform its obligations hereunder and
that the statements made by it in a Statement of Eligibility on Form T-1
supplied to the Company are true and accurate, subject to the qualifications set
forth therein. Neither the Trustee nor any Authenticating Agent shall be
accountable for the use or application by the Company of Securities or the
proceeds thereof.

Section 605. May Hold Securities.

          The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
608 and 613, may otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other agent.

Section 606. Money Held in Trust.

          Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.

Section 607. Compensation and Reimbursement.



                                      -46-


          (a) The Company agrees:

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

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

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

Section 608. Disqualification; Conflicting Interests.

          The Trustee for the Securities of any series issued hereunder shall be
subject to the provisions of Section 310(b) of the Trust Indenture Act during
the period of time provided for therein. In determining whether the Trustee has
a conflicting interest as defined in Section 310(b) of the Trust Indenture Act
with respect to the Securities of any specific series, this Indenture shall be
excluded with respect to Securities of any series of Securities other than that
specific series.

Section 609. Corporate Trustee Required; Eligibility.

          There shall at all times be one (and only one) Trustee hereunder with
respect to the Securities of each series, which may be a Trustee hereunder for
Securities of one or more other series and each of which shall be a corporation
organized and doing business under the laws of the United States of America, any
State thereof or the District of Columbia, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section and to the extent
permitted by the Trust Indenture Act, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most


                                      -47-


recent report of condition so published. If at any time the Trustee shall cease
to be eligible in accordance with the provisions of this Section, it shall
resign immediately in the manner and with the effect hereinafter specified in
this Article.

Section 610. Resignation and Removal; Appointment of Successor.

          (a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 611.

          (b) The Trustee may resign at any time with respect to the Securities
of one or more series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 611 shall
not have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.

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

          (d) If at any time:

          (1) the Trustee shall fail to comply with Section 608(a) after written
     request therefor by the Company or by any Holder who has been a bona fide
     Holder of a Security for at least six months, or

          (2) the Trustee shall cease to be eligible under Section 609 and shall
     fail to resign after written request therefor by the Company or by any such
     Holder, or

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

then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee with respect to all securities, or (ii) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of


                                      -48-


the Trustee with respect to all Securities and the appointment of a successor
Trustee or Trustees.

          (e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, with
respect to the Securities of one or more series, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee or Trustees with respect
to the Securities of that or those series (it being understood that any such
successor Trustee may be appointed with respect to the Securities of one or more
or all of such series and that at any time there shall be only one Trustee with
respect to the Securities of any particular series) and shall comply with the
applicable requirements of Section 611. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Securities of any Series shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable requirements of Section
611, become the successor Trustee with respect to the Securities of such series
and to that extent supersede the successor Trustee appointed by the Company. If
no successor Trustee with respect to the Securities of any Series shall have
been so appointed by the Company or the Holders and accepted appointment in the
manner required by Section 611, any Holder who has been a bona fide Holder of a
Security of such series 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 Trustee with respect to the Securities of such
series.

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

Section 611. Acceptance of Appointment by Successor.

          (a) In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on the request
of the Company or the successor Trustee, such retiring Trustee shall, upon
payment of its charges, execute and deliver an instrument


                                      -49-


transferring to such successor Trustee all the rights, powers and trusts of the
retiring Trustee and shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder.

          (b) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Trustee all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates, (2)
if the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee; and upon the execution and delivery of such supplemental
indenture the resignation or removal of the retiring Trustee shall become
effective to the extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates; but, on request of the Company or any successor Trustee, such
retiring Trustee shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder with
respect to the Securities of that or those series to which the appointment of
such successor Trustee relates.

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

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



                                      -50-


Section 612. Merger, Conversion, Consolidation or Succession to Business.

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

Section 613. Preferential Collection of Claims Against Company.

          The Trustee shall comply with Section 311(a) of the Trust Indenture
Act with respect to each series of Securities for which it is Trustee.

Section 614. Appointment of Authenticating Agent.

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


                                      -51-


provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.

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

          (c) An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give written notice of
such appointment in the manner provided for in Section 106 to all Holders of
Securities of the series with respect to which such Authenticating Agent will
serve. Any successor Authenticating Agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.

          (d) The Trustee agrees to pay to each Authenticating Agent from time
to time reasonable compensation for its services under this Section and the
Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 607.

          (e) If an appointment with respect to one or more series is made
pursuant to this Section, the Securities of such series may have endorsed
thereon, in addition to the Trustee's certificate of authentication, an
alternate certificate of authentication in the following form:

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



                                      -52-


                                              UNION BANK OF CALIFORNIA, N.A.,
                                                  as Trustee



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


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



                                  ARTICLE SEVEN

                Holders' Lists and Reports by Trustee and Company

Section 701. Company to Furnish Trustee Names and Addresses of Holders.

          The Company will furnish or cause to be furnished to the Trustee:

          (a) semi-annually, not later than June 30 and December 31 in each
year, a list, in such form as the Trustee may reasonably require, of the names
and addresses of the Holders as of the preceding June 15 or December 15, as the
case may be, and

          (b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such list
is furnished;

excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar; provided that the Company shall not be obligated
to provide such a list of Holders at any time that such list would not differ
from the last such list provided by the Company to the Trustee under this
Section 701.

Section 702. Preservation of Information; Communications to Holders.

          (a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar.



                                      -53-


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

          (c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of either of them shall be held accountable by reason of the
disclosure of any such information as to the names and addresses of the Holders
in accordance with Section 702(b), regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under Section 702(b).

Section 703. Reports by Trustee.

          (a) The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to
Section 313(a) of the Trust Indenture Act at the times and in the manner
provided pursuant thereto. The Trustee shall also comply with the other
provisions of Section 313 of the Trust Indenture Act.

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

Section 704. Reports by Company.

          (a) The Company shall:

          (1) file with the Trustee, within 15 days after the Company 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 Company may be required to file
     with the Commission pursuant to Section 13 or Section 15(d) of the Exchange
     Act; or, if the Company is not required to file information, documents or
     reports pursuant to either of said Sections, then it shall file with the
     Trustee and the Commission, in accordance with rules and regulations
     prescribed from time to time by the Commission, such of the supplementary
     and periodic information, documents and reports which may be required
     pursuant to Section 13 of the Exchange Act in respect of a security listed
     and registered on a national securities exchange as may be prescribed from
     time to time in such rules and regulations;



                                      -54-


          (2) file with the 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 Company with the conditions and covenants of this Indenture as may be
     required from time to time by such rules and regulations, including, in the
     case of annual reports, if required by such rules and regulations and to
     the extent required by the Trust Indenture Act, certificates or opinions of
     independent public accountants conforming to the requirements of Section
     102(b) as to compliance with conditions or covenants, compliance with which
     is subject to verification by accountants;

          (3) transmit by mail to all Holders, as their names and addresses
     appear in the Security Register, within 30 days after the filing thereof
     with the Trustee, such summaries of any information, documents and reports
     required to be filed by the Company pursuant to paragraphs (1) and (2) of
     this Section as may be required by rules and regulations prescribed from
     time to time by the Commission; and

          (4) furnish to the Trustee, not less often than annually, a brief
     certificate from the principal executive officer, principal financial
     officer or principal accounting officer as to his or her knowledge of the
     Company's compliance with all conditions and covenants under this Indenture
     (which, for purposes of this paragraph, shall be determined without regard
     to any period of grace or requirement of notice provided under this
     Indenture).

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


                                  ARTICLE EIGHT

              Consolidation, Merger, Conveyance, Transfer or Lease

Section 801. Company May Consolidate, Etc., Only on Certain Terms.

          The Company shall not consolidate with or merge into any other Person
or convey, transfer or lease all or substantially all of its properties and
assets to any Person, and the Company shall not permit any Person to consolidate
with or merge into the


                                      -55-


Company or convey, transfer or lease all or substantially all of its properties
and assets to the Company, unless:

          (1) in case the Company shall consolidate with or merge into another
     Person or convey, transfer or lease all or substantially all of its
     properties and assets to any Person, the Person formed by or resulting from
     such consolidation or into which the Company is merged or the Person which
     acquires by conveyance or transfer, or which leases, all or substantially
     all of the properties and assets of the Company, shall be a corporation,
     partnership or trust or limited liability company organized and existing
     under the laws of the United States of America, any state thereof or the
     District of Columbia, and shall expressly assume, by an indenture (or
     indentures, if at such time there is more than one Trustee) supplemental
     hereto, executed by the successor Person and delivered to the Trustee the
     due and punctual payment of the principal of, any premium and interest on
     all the Securities and the performance of every obligation in this
     Indenture and the Outstanding Securities on the part of the Company to be
     performed or observed;

          (2) immediately after giving effect to such transaction and treating
     any indebtedness which becomes an obligation of the Company or a Subsidiary
     as a result of such transaction as having been incurred by the Company or
     such Subsidiary at the time of such transaction, no Event of Default, and
     no event which, after notice or lapse of time or both, would become an
     Event of Default, shall have happened and be continuing;

          (3) if, as a result of any such consolidation or merger or such
     conveyance, transfer or lease, properties or assets of the Company would
     become subject to a mortgage, pledge, lien, security interest or other
     encumbrance which would not be permitted by this Indenture, the Company or
     such successor Person, as the case may be, shall take such steps as shall
     be necessary effectively to secure the Securities equally and ratably with
     (or prior to) all indebtedness secured thereby; and

          (4) the Company has delivered to the Trustee an Officers' Certificate
     and an Opinion of Counsel, each stating that such consolidation, merger,
     conveyance, transfer or lease and, if a supplemental indenture is required
     in connection with such transaction, such supplemental indenture comply
     with this Article and that all conditions precedent herein provided for
     relating to such transaction have been complied with.

Section 802. Successor Person Substituted.



                                      -56-


          Upon any consolidation by the Company with or merger by the Company
into any other Person or any conveyance, transfer or lease of all or
substantially all of the properties and assets of the Company in accordance with
Section 801, the successor Person formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if such successor
Person had been named as the Company herein, and thereafter, except in the case
of a lease, the predecessor Person shall be relieved of all obligations and
covenants under this Indenture and the Securities.


                                  ARTICLE NINE

                             Supplemental Indentures

Section 901. Supplemental Indentures without Consent of Holders.

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

          (1) to evidence the succession of another Person to the Company and
     the assumption by any such successor of the covenants of the Company herein
     and in the Securities; or

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

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

          (4) to add to or change any of the provisions of this Indenture to
     such extent as shall be necessary to permit or facilitate the issuance of
     Securities in bearer form, registerable or not registerable as to
     principal, and with or without interest coupons, or to permit or facilitate
     the issuance of Securities in uncertificated form; or



                                      -57-


          (5) to add to, change or eliminate any of the provisions of this
     Indenture in respect of one or more series of Securities, provided that any
     such addition, change or elimination (A) shall neither (i) apply to any
     Security of any series created prior to the execution of such supplemental
     indenture and entitled to the benefit of such provision nor (ii) modify the
     rights of the Holder of any such Security with respect to such provision or
     (B) shall become effective only when there is no such Security Outstanding;
     or

          (6) to establish the form or terms of Securities of any series as
     permitted by Sections 201 and 301; or

          (7) to evidence and provide for the acceptance of appointment
     hereunder by a successor Trustee with respect to the Securities of one or
     more series and to add to or change any of the provisions of this Indenture
     as shall be necessary to provide for or facilitate the administration of
     the trusts hereunder by more than one Trustee, pursuant to the requirements
     of Section 611(b); or

          (8) to add to or change any of the provisions of this Indenture with
     respect to any Securities that by their terms may be converted into
     securities or other property other than Securities of the same series and
     of like tenor, in order to permit or facilitate the issuance, payment or
     conversion of such Securities; or

          (9) to qualify or maintain qualification of this Indenture under the
     Trust Indenture Act; or

          (10) to cure any ambiguity, to correct or supplement any provision
     herein which may be defective or inconsistent with any other provision
     herein, or to make any other provisions with respect to matters or
     questions arising under this Indenture, provided such action shall not
     adversely affect the interests of the Holders of Securities of any series
     in any material respect.

Section 902. Supplemental Indentures with Consent of Holders.

          (a) With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders of Securities of such series under this Indenture; provided, however,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby,



                                      -58-


          (1) change the Stated Maturity of the principal of, or any installment
     of principal of or interest on, any Security, or reduce the principal
     amount thereof or the rate of interest thereon or any premium payable upon
     the redemption thereof, or reduce the amount of the principal of an
     Original Issue Discount Security that would be due and payable upon a
     declaration of acceleration of the Maturity thereof pursuant to Section
     502, or change any Place of Payment where, or the coin or currency in
     which, any Security or any premium or the interest thereon is payable, or
     impair the right to institute suit for the enforcement of any such payment
     on or after the Stated Maturity thereof (or, in the case of redemption, on
     or after the Redemption Date), or

          (2) reduce the percentage in principal amount of the Outstanding
     Securities of any series, the consent of whose Holders is required for any
     such supplemental indenture, or the consent of whose Holders is required
     for any waiver (of compliance with certain provisions of this Indenture or
     certain defaults hereunder and their consequences) provided for in this
     Indenture, or

          (3) modify any of the provisions of this Section, Section 513 or
     Section 1007, except to increase any such percentage or to provide that
     certain other provisions of this Indenture cannot be modified or waived
     without the consent of the Holder of each Outstanding Security affected
     thereby, provided, however, that this clause shall not be deemed to require
     the consent of any Holder with respect to changes in the references to "the
     Trustee" and concomitant changes in this Section and Section 1007, or the
     deletion of this proviso, in accordance with the requirements of Sections
     611(b) and 901(8).

          (b) A supplemental indenture which changes or eliminates any covenant
or other provision of this Indenture which has expressly been included solely
for the benefit of one or more particular series of Securities, or which
modifies the rights of the Holders of Securities of such series with respect to
such covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Securities of any other series.

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

Section 903. Execution of Supplemental Indentures.

          In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to


                                      -59-


Section 601) shall be fully protected in relying upon, in addition to the
documents required by Section 102, an Opinion of Counsel stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture. The Trustee may, but shall not be obligated to, enter into any such
supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.

Section 904. Effect of Supplemental Indentures.

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

Section 905. Conformity with Trust Indenture Act.

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

Section 906. Reference in Securities to Supplemental Indentures.

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


                                   ARTICLE TEN

                                    Covenants

Section 1001. Payment of Principal, Premium and Interest.

          The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of (and premium,
if any) and interest on the Securities of that series in accordance with the
terms of the Securities and this Indenture.

Section 1002. Maintenance of Office or Agency.

          (a) The Company will maintain in each Place of Payment for any series
of Securities an office or agency where Securities of that series may be
presented


                                      -60-


or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Company in respect of the Securities of that series and this Indenture
may be served. The Company will give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee as its agent
to receive all such presentations, surrenders, notices and demands.

          (b) The Company may also from time to time designate one or more other
offices or agencies where the Securities of one or more series may be presented
or surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designation or rescission
shall in any manner relieve the Company of its obligation to maintain an office
or agency in each Place of Payment for Securities of any series for such
purposes. The Company will give prompt written notice to the Trustee of any such
designation or rescission and of any change in the location of any such other
office or agency.

Section 1003. Money for Securities Payments to Be Held in Trust.

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

          (b) Whenever the Company shall have one or more Paying Agents for any
series of Securities, it will, on or before each due date of the principal of
(and premium, if any) or interest on any Securities of that series, deposit with
a Paying Agent a sum sufficient to pay the principal (and premium, if any) or
interest so becoming due, such sum to be held in trust for the benefit of the
Persons entitled to such principal, premium or interest, and (unless such Paying
Agent is the Trustee) the Company will promptly notify the Trustee of its action
or failure so to act.

          (c) The Company will cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will (1) comply with the
provisions of the Trust Indenture Act applicable to it as a Paying Agent and (2)
during the continuance of any


                                      -61-


default by the Company (or any other obligor upon the Securities of that series)
in the making of any payment in respect of the Securities of that series, upon
the written request of the Trustee, forthwith pay to the Trustee all sums held
in trust by such Paying Agent for payment in respect of the Securities of that
series.

          (d) The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.

          (e) Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of (and premium,
if any) or interest on any Security of any series and remaining unclaimed for
two years after such principal (and premium, if any) or interest has become due
and payable shall be paid to the Company on Company Request, or (if then held by
the Company) shall be discharged from such trust; and the Holder of such
Security shall thereafter, as an unsecured general creditor, look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease.

Section 1004. Corporate Existence.

          Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence and all licenses and permits material to the normal conduct of its
business; provided, however, that the Company shall not be required to preserve
any such right or franchise if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and that the loss thereof is not disadvantageous in any material
respect to the Holders.

Section 1005. [Reserved].

Section 1006. Statement by Officers as to Default.

          The Company will deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions, covenants and conditions of this Indenture (without regard to any
period of grace or requirement of


                                      -62-


notice provided hereunder), and if the Company shall be in default, specifying
all such defaults and the nature and status thereof of which they may have
knowledge.

Section 1007. Waiver of Certain Covenants.

          Except as otherwise specified as contemplated by Section 301 for
securities of such series, the Company may, with respect to the Securities of
any series, omit in any particular instance to comply with any term, provision
or condition set forth in any covenant provided pursuant to Section 301(b)(19),
901(2) or 901(7) for the benefit of the Holders of such series or in any of
Sections 1002, 1004 and 1005, inclusive, if before the time for such compliance
the Holders of not less than a majority in principal amount of the Outstanding
Securities of such series shall, by Act of such Holders, either waive such
compliance in such instance or generally waive compliance with such term,
provision or condition but no such waiver contemplated by this Section 1007
shall extend to or affect such term, provision or condition except to the extent
so expressly waived, and, until such waiver shall become effective, the
obligations of the Company and the duties of the Trustee in respect of any such
term, provision or condition shall remain in full force and effect.

Section 1008. Calculation of Original Issue Discount.

          The Company shall file with the Trustee as promptly as possible after
the end of each calendar year (i) a written notice specifying the amount of
original issue discount (including daily rates and accrual periods) accrued on
Outstanding Securities as of the end of such year and (ii) such other specific
information relating to such original issue discount as may then be relevant
under the Internal Revenue Code of 1986, as amended from time to time.


                                 ARTICLE ELEVEN

                            Redemption of Securities

Section 1101. Applicability of Article.

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

Section 1102. Election to Redeem; Notice to Trustee.

          The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution or in another manner specified as contemplated
by Section 301 for


                                      -63-


such Securities. In case of any redemption at the election of the Company of
less than all the Securities of any series (including any such redemption
affecting only a single Security), the Company shall, at least 60 days prior to
the Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Securities of such series to be redeemed and, if
applicable, of the tenor of the Securities to be redeemed. In the case of any
redemption of Securities (A) prior to the expiration of any restriction on such
redemption provided in the terms of such Securities or elsewhere in this
Indenture or (B) pursuant to an election of the Company that is subject to a
condition specified in the terms of such Securities or elsewhere in this
Indenture, the Company shall furnish the Trustee with an Officers' Certificate
evidencing compliance with such restriction or condition.

Section 1103. Selection by Trustee of Securities to Be Redeemed.

          (a) If less than all the Securities of any series are to be redeemed
(unless all the Securities of such series and of a specified tenor are to be
redeemed or unless such redemption affects only a single Security), the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee, from the Outstanding Securities of
such series not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of a portion of the principal amount of any Security of such series,
provided that the unredeemed portion of the principal amount of any Security
shall be in an authorized denomination (which shall not be less than the minimum
authorized denomination) for such Security. If less than all the Securities of
such series and of a specified tenor are to be redeemed (unless such redemption
affects only a single Security), the particular Securities to be redeemed shall
be selected not more than 60 days prior to the Redemption Date by the Trustee,
from the Outstanding Securities of such series and specified tenor not
previously called for redemption in accordance with the preceding sentence.

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

          (c) The provisions of the two preceding paragraphs shall not apply
with respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.



                                      -64-


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

Section 1104. Notice of Redemption.

          Notice of redemption shall be given in the manner provided in Section
106 not less than 30 days nor more than 60 days prior to the Redemption Date, to
each Holder of Securities to be redeemed, at his address appearing in the
Security Register.

          All notices of redemption shall state:

          (1) the Redemption Date,

          (2) the Redemption Price or, if not then ascertainable, the manner of
     calculation thereof,

          (3) if less than all the Outstanding Securities of any series
     consisting of more than a single Security are to be redeemed, the
     identification (and, in the case of partial redemption of any such
     Securities, the principal amounts) of the particular Securities to be
     redeemed and, if less than all the Outstanding Securities of any series
     consisting of a single Security are to be redeemed, the principal amount of
     the particular Security to be redeemed,

          (4) the CUSIP numbers of the Securities to be redeemed,

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

          (6) the place or places where such Securities are to be surrendered
     for payment of the Redemption Price, and

          (7) that the redemption is for a sinking fund, if such is the case.

          Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.

Section 1105. Deposit of Redemption Price.



                                      -65-


          On or prior to 10:00 a.m., New York City time, on any Redemption Date,
the Company shall deposit with the Trustee or with a Paying Agent (or, if the
Company is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 1003) an amount of money sufficient to pay the Redemption
Price of, and (except if the Redemption Date shall be an Interest Payment Date
unless otherwise specified as contemplated by Section 301) accrued interest on,
all the Securities which are to be redeemed on that date.

Section 1106. Securities Payable on Redemption Date.

          Notice of redemption having been given as aforesaid, the Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Company at the Redemption Price, together with accrued interest
to the Redemption Date; provided, however, that, unless otherwise specified as
contemplated by Section 301, installments of interest whose Stated Maturity is
on or prior to the Redemption Date shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of business on the relevant Record Dates according to their terms and the
provisions of Section 307.

          If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.

Section 1107. Securities Redeemed in Part.

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


                                      -66-


                                 ARTICLE TWELVE

                                  Sinking Funds

Section 1201. Applicability of Article.

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

          The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a "mandatory sinking
fund payment", and any payment in excess of such minimum amount provided for by
the terms of Securities of any series is herein referred to as an "optional
sinking fund payment". If provided for by the terms of Securities of any series,
the cash amount of any sinking fund payment may be subject to reduction as
provided in Section 1202. Each sinking fund payment shall be applied to the
redemption of Securities of any series as provided for by the terms of
Securities of such series.

Section 1202. Satisfaction of Sinking Fund Payments with Securities.

          The Company (1) may deliver Outstanding Securities of a series (other
than any previously called for redemption) and (2) may apply as a credit
Securities of a series which have been redeemed either at the election of the
Company pursuant to the terms of such Securities or through the application of
permitted optional sinking fund payments pursuant to the terms of such
Securities, in each case in satisfaction of all or any part of any sinking fund
payment with respect to the Securities of such series required to be made
pursuant to the terms of such Securities as provided for by the terms of such
series; provided that such Securities have not been previously so credited. Such
Securities shall be received and credited for such purpose by the Trustee at the
Redemption Price specified in such Securities for redemption through operation
of the sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.

Section 1203. Redemption of Securities for Sinking Fund.

          Not less than 60 days prior to each sinking fund payment date for any
series of Securities, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing sinking fund payment for
that series pursuant to the terms of that series, the portion thereof, if any,
which is to be satisfied by payment of cash and the portion thereof, if any,
which is to be satisfied by delivering and crediting Securities of that series
pursuant to Section 1202 and stating the basis for such credit and that such
Securities have not been previously so credited and will also deliver to the
Trustee any Securities to be so delivered. Not less than 30 days before each
such sinking fund payment date the Trustee shall select the Securities to be
redeemed upon such sinking fund payment date in the manner specified in Section
1103 and cause notice of the redemption thereof to be given in the name of and
at the expense of the Company in


                                      -67-


the manner provided in Section 1104. Such notice having been duly given, the
redemption of such Securities shall be made upon the terms and in the manner
stated in Sections 1106 and 1107.


                                ARTICLE THIRTEEN

                       Defeasance and Covenant Defeasance

Section 1301. Applicability of Article; Company's Option to Effect Defeasance or
              Covenant Defeasance.

          If pursuant to Section 301 provision is made for either or both of (a)
Defeasance of the Securities of a series under Section 1302 or (b) Covenant
Defeasance of the Securities of a series under Section 1303, then the provisions
of such Section or Sections, as the case may be, together with the other
provisions of this Article Thirteen, shall be applicable to the Securities of
such series, and the Company may at its option, at any time, with respect to the
Securities of such series, elect to have either Section 1302 (if applicable) or
Section 1303 (if applicable) be applied to the Outstanding Securities of such
series upon compliance with the conditions set forth below in this Article
Thirteen. Any such election shall be evidenced by a Board Resolution or in
another manner specified as contemplated by Section 301 for such Securities.

Section 1302. Defeasance and Discharge.

          Upon the Company's exercise of its option (if any) to have this
Section applied to any Securities or any series of Securities, as the case may
be, the Company shall be deemed to have been discharged from its obligations
with respect to such Securities as provided in this Section, on and after the
date the conditions set forth in Section 1304 are satisfied (hereinafter called
"Defeasance"). For this purpose, such Defeasance means that the Company shall be
deemed to have paid and discharged the entire indebtedness represented by such
Securities and to have satisfied all its other obligations under such Securities
and this Indenture insofar as such Securities are concerned (and the Trustee, at
the expense of the Company, shall execute proper instruments acknowledging the
same), subject to the following which shall survive until otherwise terminated
or discharged hereunder:

          (1) the rights of Holders of such Securities to receive, solely from
     the trust fund described in Section 1304 and as more fully set forth in
     such Section, payments in respect of the principal of and any premium and
     interest on such Securities when payments are due,



                                      -68-


          (2) the Company's obligations with respect to such Securities under
     Sections 304, 305, 306, 1002 and 1003,

          (3) the rights, powers, trusts, duties and immunities of the Trustee
     hereunder, and

          (4) this Article Thirteen.

Subject to compliance with this Article Thirteen, the Company may exercise its
option (if any) to have this Section applied to any Securities notwithstanding
the prior exercise of its option (if any) to have Section 1303 applied to such
Securities.

Section 1303. Covenant Defeasance.

          Upon the Company's exercise of its option (if any) to have this
Section applied to any Securities or any series of Securities, as the case may
be,

          (1) the Company shall be released from its obligations under Section
     801(3), and any covenants provided pursuant to Section 301(b)(19), 901(2)
     or 901(7) for the benefit of the Holders of such Securities, and

          (2) the occurrence of any event specified in Sections 501(4) (with
     respect to any of Section 801(3), and any such covenants provided pursuant
     to Section 301(b)(19), 901(2) or 901(7)) and 501(8) shall be deemed not to
     be or result in an Event of Default,

in each case with respect to such Securities as provided in this Section on and
after the date the conditions set forth in Section 1304 are satisfied
(hereinafter called "Covenant Defeasance"). For this purpose, such Covenant
Defeasance means that, with respect to such Securities, the Company may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such specified Section (to the extent so specified
in the case of Section 501(4)), whether directly or indirectly by reason of any
reference elsewhere herein to any such Section, Clause or Article or by reason
of any reference in any such Section, Clause or Article to any other provision
herein or in any other document, but the remainder of this Indenture and such
Securities shall be unaffected thereby. Following a Covenant Defeasance, payment
of the Securities of such series may not be accelerated because of or by
reference to the Sections specified above in this Section 1303.

Section 1304. Conditions to Defeasance or Covenant Defeasance.

          The following shall be the conditions precedent to application of
either Section 1302 or Section 1303 to the Outstanding Securities of such
series:


                                      -69-


          (1) the Company shall irrevocably have deposited or caused to be
     deposited with the Trustee (or another trustee satisfying the requirements
     of Section 609 who shall agree to comply with the provisions of this
     Article Thirteen applicable to it) as trust funds in trust for the purpose
     of making the following payments, specifically pledged as security for, and
     dedicated solely to, the benefit of the Holders of such Securities,

               (i) money in an amount, or

               (ii) U.S. Government Obligations which through the scheduled
          payment of principal and interest in respect thereof in accordance
          with their terms will provide, not later than one day before the due
          date of any payment, money in an amount, or

               (iii) a combination thereof,

          sufficient, in the opinion of a nationally recognized firm of
          independent public accountants expressed in a written certification
          thereof delivered to the Trustee (in case U.S. Government Obligations
          have so been deposited), to pay and discharge, and which shall be
          applied by the Trustee (or other qualifying trustee) to pay and
          discharge, (i) the principal of (and premium, if any) and interest on
          the Outstanding Securities of such series to maturity or redemption,
          as the case may be, and (ii) any mandatory sinking fund payments or
          analogous payments applicable to the Outstanding Securities of such
          series on the due dates thereof. Before such a deposit the Company may
          make arrangements satisfactory to the Trustee for the redemption of
          Securities at a future date or dates in accordance with Article
          Eleven, which shall be given effect in applying the foregoing. For
          this purpose, "U.S. Government Obligations" means securities that are
          (x) direct obligations of the United States of America for the payment
          of which its full faith and credit is pledged or (y) obligations of a
          Person controlled or supervised by and acting as an agency or
          instrumentality of the United States of America the payment of which
          is unconditionally guaranteed as a full faith and credit obligation by
          the United States of America, which, in either case, are not callable
          or redeemable at the option of the issuer thereof, and shall also
          include a depositary receipt issued by a bank (as defined in Section
          3(a)(2) of the Securities Act) as custodian with respect to any such
          U.S. Government Obligation or a specific payment of principal of or
          interest on any such U.S. Government Obligation held by such custodian
          for the account of the holder of such depositary receipt, provided
          that (except as required by law) such custodian is not authorized to
          make any deduction from the amount payable to the holder of such
          depositary receipt from any amount received by the custodian in
          respect


                                      -70-


          of the U.S. Government Obligation or the specific payment of principal
          of or interest on the U.S. Government Obligation evidenced by such
          depositary receipt.

          (2) In the event of an election to have Section 1302 apply to any
     Securities or any series of Securities, as the case may be, the Company
     shall have delivered to the Trustee an Opinion of Counsel stating that (A)
     the Company has received from, or there has been published by, the Internal
     Revenue Service a ruling or (B) since the date of this instrument, there
     has been a change in the applicable Federal income tax law, in either case
     (A) or (B) to the effect that, and based thereon such opinion shall confirm
     that, the Holders of such Securities will not recognize gain or loss for
     Federal income tax purposes as a result of the deposit, Defeasance and
     discharge to be effected with respect to such Securities and will be
     subject to Federal income tax on the same amount, in the same manner and at
     the same times as would be the case if such deposit, Defeasance and
     discharge were not to occur.

          (3) In the event of an election to have Section 1303 apply to any
     Securities or any series of Securities, as the case may be, the Company
     shall have delivered to the Trustee an Opinion of Counsel to the effect
     that the Holders of such Securities will not recognize gain or loss for
     Federal income tax purposes as a result of the deposit and Covenant
     Defeasance to be effected with respect to such Securities and will be
     subject to Federal income tax on the same amount, in the same manner and at
     the same times as would be the case if such deposit and Covenant Defeasance
     were not to occur.

          (4) The Company shall have delivered to the Trustee an Officers'
     Certificate to the effect that neither such Securities nor any other
     Securities of the same series, if then listed on any securities exchange,
     will be delisted as a result of such deposit.

          (5) No Event of Default or event which with notice or lapse of time or
     both would become an Event of Default with respect to the Securities of
     such series shall have occurred and be continuing (A) on the date of such
     deposit (other than an Event of Default resulting from the incurrence of
     indebtedness all or a portion of which the proceeds of which will be used
     to defease the Securities concurrently with such incurrence) or (B) insofar
     as subsections 501(6) and (7) are concerned, at any time during the period
     ending on the 90th day after the date of such deposit or, if longer, ending
     on the day following the expiration of the longest preference period
     applicable to the Company in respect of such deposit (it being understood
     that the condition in this clause (B) is a condition subsequent and shall
     not be deemed satisfied until the expiration of such period).



                                      -71-


          (6) Such Defeasance or Covenant Defeasance shall not (A) cause the
     Trustee for the Securities of such series to have a conflicting interest as
     defined in Section 608 or for purposes of the Trust Indenture Act with
     respect to any securities of the Company or (B) result in the trust arising
     from such deposit to constitute, unless it is qualified as, a regulated
     investment company under the Investment Company Act of 1940, as amended.

          (7) Such Defeasance or Covenant Defeasance shall not result in a
     breach or violation of, or constitute a default under, this Indenture or
     any other agreement or instrument to which the Company is a party or by
     which it is bound.

          (8) The Company shall have delivered to the Trustee an Officers'
     Certificate and an Opinion of Counsel, each stating that all conditions
     precedent provided for relating to either the Defeasance under Section 1302
     or the Covenant Defeasance under Section 1303 (as the case may be) have
     been complied with.

Section 1305. Deposited Money and U.S. Government Obligations to be Held
              in Trust; Other Miscellaneous Provisions.

          (a) Subject to the provisions of the last paragraph of Section 1003,
all money and U.S. Government Obligations (including the proceeds thereof)
deposited with the Trustee (or other qualifying trustee -- collectively, for
purposes of this Section 1305, the "Trustee") pursuant to Section 1304 in
respect of the Outstanding Securities of such series shall be held in trust and
applied by the Trustee, in accordance with the provisions of such Securities and
this Indenture, to the payment, either directly or through any Paying Agent (but
not including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of such Securities, of all sums due and to become due
thereon in respect of principal (and premium, if any) and interest, but such
money need not be segregated from other funds except to the extent required by
law.

          (b) Anything herein to the contrary notwithstanding, the Trustee shall
deliver or pay to the Company from time to time upon Company Request any money
or U.S. Government Obligations held by it as provided in Section 1304 which, in
the opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee (in case
U.S. Government Obligations are so being held by the Trustee), are in excess of
the amount thereof which would then be required to be deposited to effect an
equivalent Defeasance or Covenant Defeasance.



                                      -72-


Section 1306. Reinstatement.

          If the Trustee or the Paying Agent is unable to apply any money in
accordance with Section 1302 or 1303 by reason of any order or judgment or any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Company's obligations under the Securities of such
series shall be revived and reinstated as though no deposit had occurred
pursuant to this Article Thirteen until such time as the Trustee or Paying Agent
is permitted to apply all such money in accordance with Section 1302 or 1303;
provided, however, that if the Company makes any payment of principal of (and
premium, if any) any such Security following the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Securities to receive such payment from the money held by the Trustee or
the Paying Agent.

                            *    *    *    *    *

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



                                      -73-



          IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the day and year first above written.


                                         ORMAT TECHNOLOGIES, INC.


                                         By: /s/ Yehudit Bronicki
                                             -----------------------
                                             Name:  Yehudit Bronicki
                                             Title: Chief Executive Officer and
                                                    President



                                         UNION BANK OF CALIFORNIA, N.A.,
                                            as Trustee


                                         By: /s/ James V. Myers
                                             -----------------------
                                             Name:  James V. Myers
                                             Title: Trust Officer



                                      -74-

EX-4.3

                                                                     EXHIBIT 4.3

================================================================================



                            ORMAT TECHNOLOGIES, INC.

                                       TO

                         UNION BANK OF CALIFORNIA, N.A.
                                     Trustee



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

                                    INDENTURE

                          Dated as of January 16, 2006

                          SUBORDINATED DEBT SECURITIES

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




===============================================================================





                            Ormat Technologies, Inc.
     Reconciliation and tie between Trust Indenture Act of 1939, as amended,
                   and Indenture, dated as of January 16, 2006

Trust Indenture Act
Section                                                        Indenture Section
Section 310 (a)(1)   ........................................  609
            (a)(2)   ........................................  609
            (a)(3)   ........................................  Not Applicable
            (a)(4)   ........................................  Not Applicable
            (b)      ........................................  608
                                                               610
Section 311 (a)      ........................................  613
            (b)      ........................................  613
Section 312 (a)      ........................................  701
                                                               702 (a)
            (b)      ........................................  702 (b)
            (c)      ........................................  702 (a)
Section 313 (a)      ........................................  703 (a)
            (b)      ........................................  703 (a), 703 (b)
            (c)      ........................................  703 (a)
            (d)      ........................................  703 (b)
Section 314 (a)      ........................................  704
            (a)(4)   ........................................  101
                                                               1004
            (b)      ........................................  Not Applicable
            (c)(1)   ........................................  102
            (d)(2)   ........................................  102
            (c)(3)   ........................................  Not Applicable
            (d)      ........................................  Not Applicable
            (e)      ........................................  102
Section 315 (a)      ........................................  601
            (b)      ........................................  602
            (c)      ........................................  601
            (d)      ........................................  601
            (e)      ........................................  514
Section 316 (a)      ........................................  101
            (a)(1)(A)........................................  502
                                                               512
            (a)(1)(B)........................................  513
            (a)(2)   ........................................  Not Applicable




            (b)      ........................................  508
            (c)      ........................................  104
Section 317 (a)(1)   ........................................  503
            (a)(2)   ........................................  504
            (b)      ........................................  1003
Section 318 (a)      ........................................  107

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

NOTE:   This reconciliation and tie shall not, for any purpose, be deemed to be
        a part of the Indenture.






                                TABLE OF CONTENTS


                                                                            Page

ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION.........................................................1

Section 101.  Definitions......................................................1
Section 102.  Compliance Certificates and Opinions............................10
Section 103.  Form of Documents Delivered to Trustee..........................11
Section 104.  Acts of Holders; Record Dates...................................11
Section 105.  Notices, Etc., to Trustee and Company...........................14
Section 106.  Notice to Holders; Waiver.......................................14
Section 107.  Conflict with Trust Indenture Act...............................14
Section 108.  Effect of Headings and Table of Contents........................15
Section 109.  Successors and Assigns..........................................15
Section 110.  Separability Clause.............................................15
Section 111.  Benefits of Indenture...........................................15
Section 112.  Governing Law; Submission to Jurisdiction.......................15
Section 113.  Legal Holidays..................................................16

ARTICLE TWO SECURITY FORMS....................................................16

Section 201.  Forms Generally.................................................16
Section 202.  Form of Face of Security........................................17
Section 203.  Form of Reverse of Security.....................................19
Section 204.  Form of Legend for Global Securities............................23
Section 205.  Form of Trustee's Certificate of Authentication.................24

ARTICLE THREE THE SECURITIES..................................................24

Section 301.  Amount Unlimited; Issuable in Series............................24
Section 302.  Denominations...................................................28
Section 303.  Execution, Authentication, Delivery and Dating..................28
Section 304.  Temporary Securities............................................30
Section 305.  Registration, Registration of Transfer and Exchange.............31
Section 306.  Mutilated, Destroyed, Lost and Stolen Securities................33
Section 307.  Payment of Interest; Interest Rights Preserved..................34
Section 308.  Persons Deemed Owners...........................................35
Section 309.  Cancellation....................................................35
Section 310.  Computation of Interest.........................................36

ARTICLE FOUR SATISFACTION AND DISCHARGE.......................................36

Section 401.  Satisfaction and Discharge of Indenture.........................36
Section 402.  Application of Trust Money......................................37



                                       -i-


ARTICLE FIVE REMEDIES.........................................................38

Section 501.  Events of Default...............................................38
Section 502.  Acceleration of Maturity; Rescission and Annulment..............40
Section 503.  Collection of Indebtedness and Suits for Enforcement
                by Trustee....................................................41
Section 504.  Trustee May File Proofs of Claim................................42
Section 505.  Trustee May Enforce Claims Without Possession of Securities.....43
Section 506.  Application of Money Collected..................................43
Section 507.  Limitation on Suits.............................................43
Section 508.  Unconditional Right of Holders to Receive Principal,
                Premium and Interest..........................................44
Section 509.  Restoration of Rights and Remedies..............................44
Section 510.  Rights and Remedies Cumulative..................................45
Section 511.  Delay or Omission Not Waiver....................................45
Section 512.  Control by Holders..............................................45
Section 513.  Waiver of Past Defaults.........................................46
Section 514.  Undertaking for Costs...........................................46
Section 515.  Waiver of Stay or Extension Laws................................46

ARTICLE SIX THE TRUSTEE.......................................................47

Section 601.  Certain Duties and Responsibilities.............................47
Section 602.  Notice of Defaults..............................................47
Section 603.  Certain Rights of Trustee.......................................47
Section 604.  Not Responsible for Recitals or Issuance of Securities..........49
Section 605.  May Hold Securities.............................................49
Section 606.  Money Held in Trust.............................................49
Section 607.  Compensation and Reimbursement..................................49
Section 608.  Disqualification; Conflicting Interests.........................50
Section 609.  Corporate Trustee Required; Eligibility.........................50
Section 610.  Resignation and Removal; Appointment of Successor...............50
Section 611.  Acceptance of Appointment by Successor..........................52
Section 612.  Merger, Conversion, Consolidation or Succession to Business.....53
Section 613.  Preferential Collection of Claims Against Company...............54
Section 614.  Appointment of Authenticating Agent.............................54

ARTICLE SEVEN HOLDERS' LISTS AND REPORTS BY
TRUSTEE AND COMPANY...........................................................56

Section 701.  Company to Furnish Trustee Names and Addresses of Holders.......56
Section 702.  Preservation of Information; Communications to Holders..........56
Section 703.  Reports by Trustee..............................................56
Section 704.  Reports by Company..............................................57


                                      -ii-


ARTICLE EIGHT CONSOLIDATION, MERGER, CONVEYANCE,
TRANSFER OR LEASE.............................................................58

Section 801.  Company May Consolidate, Etc., Only on Certain Terms............58
Section 802.  Successor Person Substituted....................................59

ARTICLE NINE SUPPLEMENTAL INDENTURES..........................................60

Section 901.  Supplemental Indentures without Consent of Holders..............60
Section 902.  Supplemental Indentures with Consent of Holders.................61
Section 903.  Execution of Supplemental Indentures............................62
Section 904.  Effect of Supplemental Indentures...............................62
Section 905.  Conformity with Trust Indenture Act.............................63
Section 906.  Reference in Securities to Supplemental Indentures..............63

ARTICLE TEN COVENANTS.........................................................63

Section 1001. Payment of Principal, Premium and Interest......................63
Section 1002. Maintenance of Office or Agency.................................63
Section 1003. Money for Securities Payments to Be Held in Trust...............64
Section 1004. Corporate Existence.............................................65
Section 1005. [Reserved]......................................................65
Section 1006. Statement by Officers as to Default.............................65
Section 1007. Waiver of Certain Covenants.....................................65
Section 1008. Calculation of Original Issue Discount..........................66

ARTICLE ELEVEN SUBORDINATION OF SECURITIES....................................66

Section 1101. Securities Subordinate to Senior Indebtedness...................66
Section 1102. Payment Over of Proceeds Upon Dissolution, Etc..................66
Section 1103. No Payment When Senior Indebtedness in Default..................68
Section 1104. Payment Permitted If No Default.................................70
Section 1105. Subrogation to Rights of Holders of Senior Indebtedness.........70
Section 1106. Provisions Solely to Define Relative Rights.....................70
Section 1107. Trustee to Effectuate Subordination.............................71
Section 1108. No Waiver of Subordination Provisions...........................71
Section 1109. Notice to Trustee...............................................72
Section 1110. Reliance on Judicial Order or Certificate of Liquidating Agent..73
Section 1111. Trustee Not Fiduciary for Holders of Senior Indebtedness........73
Section 1112. Rights of Trustee as Holder of Senior Indebtedness;
                Preservation of Trustee's Rights..............................73
Section 1113. Article Applicable to Paying Agents.............................74

ARTICLE TWELVE REDEMPTION OF SECURITIES.......................................74

Section 1201. Applicability of Article........................................74
Section 1202. Election to Redeem; Notice to Trustee...........................74


                                      -iii-


Section 1203. Selection by Trustee of Securities to Be Redeemed...............74
Section 1204. Notice of Redemption............................................75
Section 1205. Deposit of Redemption Price.....................................76
Section 1206. Securities Payable on Redemption Date...........................76
Section 1207. Securities Redeemed in Part.....................................77

ARTICLE THIRTEEN SINKING FUNDS................................................77

Section 1301. Applicability of Article........................................77
Section 1302. Satisfaction of Sinking Fund Payments with Securities...........78
Section 1303. Redemption of Securities for Sinking Fund.......................78

ARTICLE FOURTEEN DEFEASANCE AND COVENANT DEFEASANCE...........................78

Section 1401. Applicability of Article; Company's Option to Effect
                Defeasance or Covenant Defeasance.............................78
Section 1402. Defeasance and Discharge........................................79
Section 1403. Covenant Defeasance.............................................79
Section 1404. Conditions to Defeasance or Covenant Defeasance.................80
Section 1405. Deposited Money and U.S. Government Obligations to be Held
                in Trust; Other Miscellaneous Provisions......................83
Section 1406. Reinstatement...................................................84

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

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


                                      -iv-



          INDENTURE, dated as of January 16, 2006, between Ormat Technologies,
Inc., a Delaware corporation (herein called the "Company"), having its principal
office at 980 Greg Street, Sparks, Nevada 89431, and Union Bank of California,
N.A., a national banking association, as Trustee (herein called the "Trustee").

                                    RECITALS

          The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its direct, unsecured
and subordinated debentures, notes or other evidences of indebtedness (herein
called the "Securities"), to be issued in one or more series as in this
Indenture provided.

          All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.

          NOW, THEREFORE, THIS INDENTURE WITNESSETH:

          For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:


                                   ARTICLE ONE

                        Definitions and Other Provisions
                             of General Application

Section 101. Definitions.

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

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

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

          (3) all accounting terms not otherwise defined herein have the
     meanings assigned to them in accordance with generally accepted accounting
     principles, and, except as otherwise herein expressly provided, the term
     "generally accepted accounting principles" with respect to any computation




     required or permitted hereunder shall mean such accounting principles as
     are generally accepted at the date of such computation;

          (4) unless the context otherwise requires, any reference to an
     "Article" or a "Section" refers to an Article or a Section, as the case may
     be, of this Indenture; and

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

          (6) references to "dollar", "dollars" and "$" are to United States
     dollars.

          "Act", when used with respect to any Holder, has the meaning specified
in Section 104.

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

          "Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.

          "Board of Directors" means any of the board of directors of the
Company or any duly authorized committee of that board or any officer of the
Company, to which authority to act on behalf of the Board of Directors has been
duly delegated.

          "Board Resolution" means a copy of a resolution certified by the
Secretary or Assistant Secretary of the Company to have been duly adopted by the
Board of Directors or any duly authorized committee of that board or any officer
of the Company, to which authority to act on behalf of the Board of Directors
has been duly delegated, and to be in full force and effect on the date of such
certification, and delivered to the Trustee.

          "Business Day", when used with respect to any Place of Payment, means
each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which


                                      -2-


banking institutions in that Place of Payment are authorized or obligated by law
or executive order to close.

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

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

          "Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Deputy
Chairman, its President or any Vice President, its Treasurer or Assistant
Treasurer, or its Secretary or any Assistant Secretary, and delivered to the
Trustee.

          "Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office at the date hereof is located at 350 California
Street, 11th Floor, San Francisco, CA 94104.

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

          "Covenant Defeasance" has the meaning specified in Section 1403.

          "Defaulted Interest" has the meaning specified in Section 307.

          "Defeasance" has the meaning specified in Section 1402.

          "Depositary" means, with respect to the Securities of any series
issuable or issued in whole or in part in the form of one or more Global
Securities, the clearing agency registered under the Exchange Act specified for
that purpose as contemplated by Section 301.

          "Event of Default" has the meaning specified in Section 501.

          "Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.



                                      -3-


          "Expiration Date" has the meaning specified in Section 104.

          "Global Security" means a Security that evidences all or part of the
Securities of any series and bears the legend set forth in Section 204 (or such
legend as may be specified as contemplated by Section 301 for such Securities).

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

          "Incur" means, with respect to any indebtedness or other obligation of
any Person, to create, issue, incur (by conversion, exchange or otherwise),
assume, guarantee or otherwise become liable in respect of such indebtedness or
other obligation or the recording, as required pursuant to generally accepted
accounting principles or otherwise, of any such indebtedness or other obligation
as a liability on the balance sheet of such Person (and "Incurrence,"
"Incurred," "Incurrable" and "Incurring" shall have meanings correlative to the
foregoing); provided, however, that a change in generally accepted accounting
principles that results in an obligation of such Person that exists at such time
becoming indebtedness shall not be deemed an Incurrence of such indebtedness.

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

          "interest", when used with respect to an Original Issue Discount
Security which by its terms bears interest only after Maturity, means interest
payable after Maturity at the rate prescribed in such Original Issue Discount
Security.

          "Interest Payment Date", when used with respect to any Security, means
the Stated Maturity of an installment of interest on such Security.

          "Investment Company Act" means the U.S. Investment Company Act of 1940
and any statute successor thereto, in each case as amended from time to time.

          "Junior Subordinated Payment" has the meaning specified in Section
1102.


                                      -4-


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

          "Notice of Default" means a written notice of the kind specified in
Section 501(4).

          "Officers' Certificate" means a certificate signed by the Chairman of
the Board, its Deputy Chairman, the Chief Executive Officer, the President or
any Vice President, or the Secretary or any Assistant Secretary of the Company,
and delivered to the Trustee. One of the officers signing an Officers'
Certificate given pursuant to Section 1006 shall be the principal executive,
financial or accounting officer of the Company.

          "Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company.

          "Original Issue Discount Security" means any Security which provides
for an amount less than the principal amount thereof to be due and payable upon
a declaration of acceleration of the Maturity thereof pursuant to Section 502.

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

          (1) Securities theretofore cancelled by the Trustee or delivered to
     the Trustee for cancellation;

          (2) Securities for whose payment or redemption money in the necessary
     amount has been theretofore deposited with the Trustee or any Paying Agent
     (other than the Company) in trust or set aside and segregated in trust by
     the Company (if the Company shall act as its own Paying Agent) for the
     Holders of such Securities; provided that, if such Securities are to be
     redeemed, notice of such redemption has been duly given pursuant to this
     Indenture or provision therefor satisfactory to the Trustee has been made;

          (3) Securities as to which Defeasance has been effected pursuant to
     Section 1302; and

          (4) Securities which have been paid pursuant to Section 306 or in
     exchange for or in lieu of which other Securities have been authenticated
     and


                                      -5-


     delivered pursuant to this Indenture, other than any such Securities in
     respect of which there shall have been presented to the Trustee proof
     satisfactory to it that such Securities are held by a protected purchaser
     in whose hands such Securities are valid obligations of the Company;

provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, (i) the principal amount of an Original Issue
Discount Security which shall be deemed to be Outstanding shall be the amount of
the principal thereof which would be due and payable as of such date upon
acceleration of the Maturity thereof pursuant to Section 502, (ii) if, as of
such date, the principal amount payable at the Stated Maturity of a Security is
not determinable, the principal amount of such Security which shall be deemed to
be Outstanding shall be the amount as specified or determined as contemplated by
Section 301, (iii) the principal amount of a Security denominated in one or more
foreign currencies or currency units which shall be deemed to be Outstanding
shall be the U.S. dollar equivalent, determined as of such date in the manner
provided as contemplated by Section 301, of the principal amount of such
Security (or, in the case of a Security described in Clause (i) or (ii) above)
of the amount determined as provided in such Clause, and (iv) Securities owned
by the Company or any other obligor upon the Securities of any Affiliate of the
Company or of such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent, waiver or other action, only Securities which the Trustee knows to be
so owned shall be so disregarded. Securities so owned which have been pledged in
good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Securities and that the pledgee is not the Company or any other obligor upon the
Securities or any Affiliate of the Company or of such other obligor.

          "Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Securities on behalf of
the Company.

          "Payment Blockage Period" has the meaning specified in Section 1103.

          "Periodic Offering" means an offering of Securities of a series from
time to time the specific terms of which Securities, including, without
limitation, the rate or rates of interest or formula for determining the rate or
rates of interest thereon, if any, the Stated Maturity or Maturities thereof and
the redemption provisions, if any, with respect thereto, are to be determined by
the Company upon the issuance of such Securities.



                                      -6-


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

          "Place of Payment", when used with respect to the Securities of any
series, means the place or places where the principal of (and premium, if any)
and interest on the Securities of that series are payable as specified as
contemplated by Section 301.

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

          "Proceeding" has the meaning specified in Section 1102.

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

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

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

          "Responsible Officer", when used with respect to the Trustee, means
the chairman or any vice-chairman of the board of directors, the chairman or any
vice-chairman of the executive committee of the board of directors, the chairman
of the trust committee, the president, any vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any trust officer or assistant trust officer, the controller
or any assistant controller or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.

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



                                      -7-


          "Securities Act" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time.

          "Securities Payment" has the meaning specified in Section 1102.

          "Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.

          "Senior Indebtedness" means the principal of, premium, if any, and
interest on and any other payment due pursuant to any of the following, whether
Incurred on or prior to the date hereof or hereafter Incurred:

          (i) all obligations of the Company for borrowed money;

          (ii) all obligations of the Company evidenced by securities, notes,
     debentures, bonds or other similar instruments (other than the Securities),
     including obligations Incurred in connection with the acquisition of
     property, assets or businesses;

          (iii) all capital lease obligations of the Company;

          (iv) all reimbursement obligations of the Company with respect to
     letters of credit, bankers' acceptances or similar facilities issued for
     the account of the Company;

          (v) all obligations of the Company issued or assumed as the deferred
     purchase price of property or services, including all obligations under
     master lease transactions pursuant to which the Company or any of its
     subsidiaries have agreed to be treated as owner of the subject property for
     U.S. federal income tax purposes;

          (vi) all payment obligations of the Company under interest rate swap
     or similar agreements or foreign currency hedge, exchange or similar
     agreements at the time of determination, including any such obligations
     Incurred by the Company solely to act as a hedge against increases in
     interest rates that may occur -7- under the terms of other outstanding
     variable or floating rate indebtedness of the Company; and

          (vii) all obligations of the type referred to in clauses (i) through
     (vii) above of another Person and all dividends of another Person the
     payment of which, in either case, the Company has assumed or guaranteed or
     for which the Company is responsible or liable, directly or indirectly,
     jointly or severally, as obligor, guarantor or otherwise;



                                      -8-


provided, however, that "Senior Indebtedness" shall not include: (1)
indebtedness or monetary obligations to trade creditors created or assumed by
the Company in the ordinary course of business including liabilities under
reinsurance and retrocessional agreements; (2) indebtedness that is by its terms
subordinate, or not superior, in right of payment to the Securities; (3)
indebtedness owed by the Company to any Subsidiary or Subsidiaries or (4) any
indebtedness of the Company to its Affiliates (including all debt securities and
guarantees in respect of those debt securities, issued to any trust, partnership
or other entity affiliated with the Company that is a financing vehicle of the
Company (a "financing entity") in connection with the issuance by such financing
entity of common securities and preferred securities or other securities
guaranteed by the Company) unless otherwise expressly provided in the terms of
any such indebtedness.

          "Senior Nonmonetary Default" has the meaning specified in Section
1103.

          "Senior Payment Default" has the meaning specified in Section 1103.

          "Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.

          "Stated Maturity", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security as the fixed date on which the principal of such Security or
such installment of principal or interest is due and payable.

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

          "Trust Indenture Act" means the U.S. Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.

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


                                      -9-


such Person, "Trustee" as used with respect to the Securities of any series
shall mean the Trustee with respect to Securities of that series.

          "U.S. Government Obligations" has the meaning specified in Section
1404.

          "Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".

Section 102. Compliance Certificates and Opinions.

          (a) Upon any application or request by the Company to the Trustee to
take any action under any provision of this Indenture, the Company shall furnish
to the Trustee:

          (1) an Officers' Certificate in form and substance reasonably
     satisfactory to the Trustee stating that, in the opinion of the signer all
     conditions precedent, if any, provided for in this Indenture relating to
     the proposed action have been complied with; and

          (2) an Opinion of Counsel in form and substance reasonably
     satisfactory to the Trustee stating that, in the opinion of such counsel,
     all conditions precedent have been complied with.

          (b) Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (except for certificates
provided for in Section 1006) shall include:

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

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

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

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



                                      -10-


Section 103. Form of Documents Delivered to 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 any officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.

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

Section 104. Acts of Holders; Record Dates.

          (a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided or permitted by this Indenture to be given, made
or taken by Holders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.



                                      -11-


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

          (c) The ownership of Securities shall be proved by the Security
Register.

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

          (e) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities of such series, provided that the
Company may not set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next paragraph. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other Holders,
shall be entitled to take the relevant action, whether or not such Holders
remain Holders after such record date; provided that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date
by Holders of the requisite principal amount of Outstanding Securities of such
series on such record date. Nothing in this paragraph shall be construed to
prevent the Company from setting a new record date for any action for which a
record date has previously been set pursuant to this paragraph (whereupon the
record date previously set shall automatically and with no action by any Person
be cancelled and of no effect), and nothing in this paragraph shall be construed
to render ineffective any action taken by Holders of the requisite principal
amount of Outstanding Securities of the relevant series on the date such action
is taken. Promptly after any record date is set pursuant to this paragraph, the
Company, at its own expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration


                                      -12-


Date to be given to the Trustee in writing and to each Holder of Securities of
the relevant series in the manner set forth in Section 106.

          (f) The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to join
in the giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 502, (iii) any request to institute
proceedings referred to in Section 507(2) or (iv) any direction referred to in
Section 512, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date; provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Trustee, at the Company's expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 106.

          (g) With respect to any record date set pursuant to this Section, the
party hereto which sets such record dates may designate any day as the
"Expiration Date" and from time to time may change the Expiration Date to any
earlier or later day; provided that no such change shall be effective unless
notice of the proposed new Expiration Date is given to the other party hereto in
writing, and to each Holder of Securities of the relevant series in the manner
set forth in Section 106, on or prior to the existing Expiration Date. If an
Expiration Date is not designated with respect to any record date set pursuant
to this Section, the party hereto which set such record date shall be deemed to
have initially designated the 180th day after such record date as the Expiration
Date with respect thereto, subject to its right to change the Expiration Date as
provided in this paragraph.

          (h) Without limiting the foregoing, a Holder entitled hereunder to
take any action hereunder with regard to any particular Security may do so with
regard to all or any part of the principal amount of such Security or by one or
more duly appointed agents each of which may do so pursuant to such appointment
with regard to all or any part of such principal amount.



                                      -13-


Section 105. Notices, Etc., to Trustee and Company.

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

          (1) the Trustee by any Holder or by the Company shall be sufficient
     for every purpose hereunder if made, given, furnished or filed in writing
     to or with the Trustee at its Corporate Trust Office, Attention: Corporate
     Trust Department, or

          (2) the Company by the Trustee or by any Holder shall be sufficient
     for every purpose hereunder (unless otherwise herein expressly provided) if
     in writing and mailed, first-class postage prepaid, to the Company
     addressed to it at the address of its principal office specified in the
     first paragraph of this instrument or at any other address previously
     furnished in writing to the Trustee by the Company, Attention: President.

Section 106. Notice to Holders; Waiver.

          (a) Where this Indenture provides for notice to Holders 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 Holder
affected by such event, at his address as it appears in the Security Register,
not later than the latest date (if any), and not earlier than the earliest date
(if any), prescribed for the giving of such notice. In any case where notice to
Holders is given by mail, neither the failure to mail such notice, nor any
defect in any notice so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders. Where this Indenture
provides for notice in any manner, such notice may be waived in writing by the
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 Holders
shall be filed with the Trustee, but such filing shall not be a condition
precedent to the validity of any action taken in reliance upon such waiver.

          (b) In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.

Section 107. Conflict with Trust Indenture Act.



                                      -14-


          If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act which is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act which may be so modified or excluded, the latter provision shall
be deemed to apply to this Indenture as so modified or excluded, as the case may
be.

Section 108. 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 109. Successors and Assigns.

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

Section 110. Separability Clause.

          In case any provision in this Indenture or in the Securities 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.

Section 111. Benefits of Indenture.

          Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder, the holders of Senior Indebtedness and the Holders, any benefit or
any legal or equitable right, remedy or claim under this Indenture.

Section 112. Governing Law; Submission to Jurisdiction.

          (a) This Indenture and the Securities shall be governed by and
construed in accordance with the laws of the State of New York, without regard
to its principles of conflicts of laws.

          (b) The Company agrees that any judicial proceedings instituted in
relation to any matter arising under this Indenture or the Securities
appertaining thereto may be brought in any United States Federal or New York
State court sitting in the Borough of Manhattan, The City of New York, New York
to the extent that such court has subject matter jurisdiction over the
controversy, and, by execution and delivery of this Indenture, the Company
hereby irrevocably accepts, generally and unconditionally,


                                      -15-


the jurisdiction of the aforesaid courts, acknowledges their competence and
irrevocably agrees to be bound by any judgment rendered in such proceeding.

Section 113. Legal Holidays.

          In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security or any other specified date with respect to any
Security shall not be a Business Day at any Place of Payment, then
(notwithstanding any other provision of this Indenture or of the Securities
(other than a provision of any Security which specifically states that such
provision shall apply in lieu of this Section)) payment of interest or principal
(and premium, if any) need not be made at such Place of Payment on such date,
but may be made on the next succeeding Business Day at such Place of Payment
with the same force and effect as if made on the Interest Payment Date,
Redemption Date, at the Stated Maturity or such other specified date, provided
that no interest, principal or premium (if any) shall accrue with respect to
such payment, for the period from and after such Interest Payment Date,
Redemption Date, Stated Maturity or such other specified date, as the case may
be. However, if such next succeeding Business Day is in the next succeeding
calendar month or calendar year, as applicable, such payment will be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such Interest Payment Date, Redemption Date, Stated Maturity or
otherwise.


                                   ARTICLE TWO

                                 Security Forms

Section 201. Forms Generally.

          (a) The Securities of each series shall be in substantially the form
set forth in this Article, or in such other form as shall be established by or
pursuant to a Board Resolution or in one or more indentures supplemental hereto,
in each case with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture, and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or Depositary therefor or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution thereof. If the form of Securities of any series is established by
action taken pursuant to a Board Resolution, a copy of an appropriate record of
such action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the Company
Order contemplated by Section 303 for the authentication and delivery of such
Securities.



                                      -16-


          (b) The Trustee's certificates of authentication shall be in
substantially the form set forth in this Article.

          (c) The definitive Securities shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers executing such Securities, as evidenced by their
execution of such Securities.

Section 202. Form of Face of Security.

          [Insert any legend required by the Internal Revenue Code and the
regulations thereunder.]

                                             ORMAT TECHNOLOGIES, INC.



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

No.___________                                                      $___________

          Ormat Technologies, Inc., a Delaware corporation (herein called the
"Company", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
_________________________ or registered assigns, the principal sum of
__________________________ Dollars on ________________________________ [If the
Security is to bear interest prior to Maturity, insert --, and to pay interest
thereon from ______________________ or from the most recent Interest Payment
Date to which interest has been paid or duly provided for, semi-annually on
___________________ and ___________________in each year, commencing
_________________________, at the rate of ___ % per annum, until the principal
hereof is paid or made available for payment [If applicable, insert --, provided
that any principal and premium, and any such installment of interest, which is
overdue shall bear interest at the rate of ___% per annum (to the extent that
the payment of such interest shall be legally enforceable), from the dates such
amounts are due until they are paid or made available for payment, and such
interest shall be payable on demand]. 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 ________________or
________________ (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date. 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


                                      -17-


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]. [If the
Security is not to bear interest prior to Maturity, insert -- The principal of
this Security shall not bear interest except in the case of a default in payment
of principal upon acceleration, upon redemption or at Stated Maturity and in
such case the overdue principal and any overdue premium shall bear interest at
the rate of ___ % per annum (to the extent that the payment of such interest
shall be legally enforceable), from the dates such amounts are due until they
are paid or made available for payment. Interest on any overdue principal or
premium shall be payable on demand.] [If applicable, insert -- Any such interest
on overdue principal or premium which is not paid on demand shall bear interest
at the rate of ___ % per annum (to the extent that the payment of such interest
on interest shall be legally enforceable), from the date of such demand until
the amount so demanded is paid or made available for payment. Interest on any
overdue interest shall be payable on demand.]

          Payment of the principal of (and premium, if any) and [if applicable,
insert -- any such] interest on this Security will be made at the office or
agency of the Company maintained for that purpose in______________, 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 [if applicable, insert -- ;
provided, however, that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register].

          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 referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.



                                      -18-



          IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.

Dated: _______



                                               ORMAT TECHNOLOGIES, INC.



                                               ---------------------------------
                                               Authorized Signatory

Section 203. 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 a Subordinated Debt Securities Indenture, dated as of January 16,
2006 (herein called the "Indenture", which term shall have the meaning assigned
to it in such instrument), between the Company and Union Bank of California,
N.A., as Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture), and reference is hereby made to the Indenture for
a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee, the holders of Senior
Indebtedness 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 [if applicable, insert --, limited
in aggregate principal amount to $___________].

          [If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice, [if applicable, insert -- (1) on
________ in any year commencing with the year _______ and ending with the year
________ through operation of the sinking fund for this series at a Redemption
Price equal to 100% of the principal amount, and (2)] at any time [if
applicable, insert -- on or after ______, 20__], as a whole or in part, at the
election of the Company, at the following Redemption Prices (expressed as
percentages of the principal amount): If redeemed [if applicable, insert -- on
or before_________, __%, and if redeemed] during the 12-month period beginning
_______ of the years indicated.

                         Redemption                         Redemption
          Year             Price             Year             Price
     --------------    --------------   --------------    --------------






                                      -19-



and thereafter at a Redemption Price equal to ___ % of the principal amount,
together in the case of any such redemption [if applicable, insert -- (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest installments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.]

          [If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, (1) on ___________ in any
year commencing with the year ___ and ending with the year _____ through
operation of the sinking fund for this series at the Redemption Prices for
redemption through operation of the sinking fund (expressed as percentages of
the principal amount) set forth in the table below, and (2) at any time [if
applicable, insert -- on or after ___________,] as a whole or in part, at the
election of the Company, at the Redemption Prices for redemption otherwise than
through operation of the sinking fund (expressed as percentages of the principal
amount) set forth in the table below: If redeemed during the 12-month period
beginning ___________ of the years indicated,


                                                        Redemption Price For
                                                        Redemption Otherwise
                      Redemption Price For                  Than Through
                       Redemption Through                 Operation of the
     Year         Operation of the Sinking Fund             Sinking Fund
 ------------     -----------------------------       -------------------------









and thereafter at a Redemption Price equal to ___ % of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest installments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the relevant
Record Dates referred to on the face hereof, all as provided in the Indenture.]



                                      -20-


          [If applicable, insert -- Notwithstanding the foregoing, the Company
may not, prior to ____________, redeem any Securities of this series as
contemplated by [if applicable, insert -- Clause 2 of] the preceding paragraph
as a part of, or in anticipation of, any refunding operation by the application,
directly or indirectly, of moneys borrowed having an interest cost to the
Company (calculated in accordance with generally accepted financial practice) of
less than __% per annum.]

          [If applicable, insert -- The sinking fund for this series provides
for the redemption on ___________ in each year beginning with the year
___________ and ending with the year ___________ of [if applicable, insert --
not less than] $____ [("mandatory sinking fund") and not more than $ _______]
aggregate principal amount of Securities of this series. [Securities of this
series acquired or redeemed by the Company otherwise than through [if
applicable, insert -- mandatory] sinking fund payments may be credited against
subsequent [mandatory] sinking fund payments otherwise required to be made -- in
the inverse order in which they become due.]

          [If the Security is subject to redemption of any kind, insert -- In
the event of redemption of this Security in part only, a new Security or
Securities of this series and of a like tenor for the unredeemed portion hereof
will be issued in the name of the Holder hereof upon the cancellation hereof.]

          [If the Security is not subject to redemption, insert -- This Security
is not redeemable prior to Stated Maturity.]

          [The Indenture contains provisions for defeasance at any time of [the
entire indebtedness of this Security or] [certain restrictive covenants and
Events of Default with respect to this Security] [, in each case] upon
compliance with certain conditions set forth therein.]

          The indebtedness evidenced by this Security is, to the extent provided
in the Indenture, subordinate and subject in right of payment to the prior
payment in full of all Senior Indebtedness, and this Security is issued subject
to the provisions of the Indenture with respect thereto. Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his or her behalf to take
such actions as may be necessary or appropriate to effectuate the subordination
so provided and (c) appoints the Trustee his or her attorney-in-fact for any and
all such purposes. Each Holder hereof, by his or her acceptance hereof, waives
all notice of the acceptance of the subordination provisions contained herein
and in the Indenture by each holder of Senior Indebtedness, whether now
outstanding or hereafter created, Incurred, assumed or guaranteed, and waives
reliance by each such Holder upon said provisions.



                                      -21-


          [If the Security is not an Original Issue Discount Security, insert --
If an Event of Default with respect to Securities of this series shall occur and
be continuing, the principal of the Securities of this series may be declared
due and payable in the manner and with the effect provided in the Indenture.]

          [If the Security is an Original Issue Discount Security, insert -- If
an Event of Default with respect to Securities of this series shall occur and be
continuing, an amount of principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to -- insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal, premium and 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 premium and interest, if any, on the Securities of this series
shall terminate.]

          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 majority of the Holders 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 specified percentages 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 compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.

          As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity. The foregoing
shall not apply to


                                      -22-


any suit instituted by the Holder of this Security for the enforcement of any
payment of principal hereof or any premium or interest hereon on or after the
respective due dates expressed herein.

          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 any premium, 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 any
premium 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 and of like tenor, of authorized denominations and for the same
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 $ ________ 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 and of like tenor of a different
authorized denomination, as requested by the Holder surrendering the same.

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

          Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the 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.

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

Section 204. Form of Legend for Global Securities.



                                      -23-


          Unless otherwise specified as contemplated by Section 301 for the
securities evidenced thereby, every Global Security authenticated and delivered
hereunder shall bear a legend in substantially the following form:

          "This Security is a Global Security within the meaning of the
          Indenture hereinafter referred to and is registered in the name of a
          Depositary or a nominee thereof. This Security may not be exchanged in
          whole or in part for a Security registered, and no transfer of this
          Security in whole or in part may be registered in the name of any
          Person other than such Depositary or a nominee thereof, except in the
          limited circumstances described in the Indenture."

Section 205. Form of Trustee's Certificate of Authentication.

          The Trustee's certificates of authentication shall be in substantially
the following form:

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



                                           UNION BANK OF CALIFORNIA, N.A.,
                                              as Trustee

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

                                  ARTICLE THREE

                                 The Securities

Section 301. Amount Unlimited; Issuable in Series.

          (a) The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.

          (b) The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 303,
set forth, or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of any series,



                                      -24-


          (1) the title of the Securities of the series (which shall distinguish
     the Securities of the series from Securities of any other series);

          (2) any limit upon the aggregate principal amount of the Securities of
     the series which may be authenticated and delivered under this Indenture
     (except for Securities authenticated and delivered upon registration of
     transfer of, or in exchange for, or in lieu of, other Securities of the
     series pursuant to Section 304, 305, 306, 906 or 1207 and except for any
     Securities which, pursuant to Section 303, are deemed never to have been
     authenticated and delivered hereunder);

          (3) the Person to whom any interest on a Security of the series shall
     be payable, if other than the Person in whose name that Security (or one or
     more Predecessor Securities) is registered at the close of business on the
     Regular Record Date for such interest;

          (4) the date or dates on which the principal of the Securities of the
     series is payable;

          (5) the rate or rates at which the Securities of the series shall bear
     interest, if any, the date or dates from which such interest shall accrue,
     the Interest Payment Dates on which such interest shall be payable and the
     Regular Record Date for the interest payable on any Interest Payment Date;

          (6) the place or places where the principal of (and premium, if any)
     and interest on Securities of the series shall be payable;

          (7) the period or periods within which, the price or prices at which,
     and the terms and conditions upon which, Securities of the series may be
     redeemed, in whole or in part, at the option of the Company and, if other
     than by a Board Resolution, the manner in which any election by the Company
     to redeem the Securities shall be evidenced;

          (8) the obligation, if any, of the Company to redeem or purchase
     Securities of the series pursuant to any sinking fund or analogous
     provisions or at the option of a Holder thereof and the period or periods
     within which, the price or prices at which and the terms and conditions
     upon which, Securities of the series shall be redeemed or purchased, in
     whole or in part, pursuant to such obligation;

          (9) any provisions necessary to permit or facilitate the issuance,
     payment or conversion of any Securities of the series that may be converted
     into


                                      -25-


     securities or other property (including shares of the Company's common or
     preferred shares or other securities of the Company) other than Securities
     of the same series and of like tenor, whether in addition to, or in lieu
     of, any payment of principal or other amount and whether at the option of
     the Company or otherwise;

          (10) if other than denominations of $1,000 and any integral multiple
     thereof, the denominations in which Securities of the series shall be
     issuable;

          (11) if other than the currency of the United States of America, the
     currency, currencies, composite currencies or currency units in which the
     principal of or any premium or interest on any Securities of the series
     shall be payable and the manner of determining the equivalent thereof in
     the currency of the United States of America for any purpose, including for
     purposes of the definition of "Outstanding" in Section 101;

          (12) if the principal of or any premium or interest on any Securities
     of the series is to be payable, at the election of the Company or the
     Holder thereof, in one or more currencies, composite currencies or currency
     units other than that or those in which such Securities are stated to be
     payable, the currency, currencies, composite currency, composite currencies
     or currency units in which the principal of or any premium or interest on
     such Securities as to which such election is made shall be payable, the
     periods within which and the terms and conditions upon which such election
     is to be made and the amount so payable (or the manner in which such amount
     shall be determined);

          (13) if the amount of payments of principal of and any premium or
     interest on the Securities of the series may be determined with reference
     to an index, a formula or any other method, the manner in which such
     amounts shall be determined;

          (14) if other than the entire principal amount thereof, the portion of
     the principal amount of Securities of the series which shall be payable
     upon declaration of acceleration of the Maturity thereof pursuant to
     Section 502;

          (15) if the principal amount payable at the Stated Maturity of any
     Securities of the series will not be determinable as of any one or more
     dates prior to the Stated Maturity, the amount which shall be deemed to be
     the principal amount of such Securities as of any such date for any purpose
     thereunder or hereunder, including the principal amount thereof which shall
     be due and payable upon any Maturity other than the Stated Maturity or
     which shall be deemed to be Outstanding as of any date prior to the Stated
     Maturity


                                      -26-


     (or, in any such case, the manner in which such amount deemed to be the
     principal amount shall be determined);

          (16) if applicable, that the Securities of the series, in whole or any
     specified part, shall be defeasible pursuant to Section 1402 or Section
     1403 or both such Sections and, if other than by a Board Resolution, the
     manner in which any election by the Company to defease such Securities
     shall be evidenced;

          (17) if applicable, that any Securities of the series shall be
     issuable in whole or in part in the form of one or more Global Securities
     and, in such case, the respective Depositaries for such Global Securities,
     the form of any legend or legends which shall be borne by any such Global
     Security in addition to or in lieu of that set forth in Section 204 and any
     circumstances in addition to or in lieu of those set forth in paragraph (h)
     of Section 305 in which any such Global Security may be exchanged in whole
     or in part for Securities registered, and any transfer of such Global
     Security in whole or in part may be registered, in the name or names of
     Persons other than the Depositary for such Global Security or a nominee
     thereof;

          (18) any addition to, elimination of, or other change in the Events of
     Default which applies to any Securities of the series and any change in the
     right of the Trustee or the requisite Holders of such Securities to declare
     the principal amount thereof due and payable pursuant to Section 502;

          (19) any addition to, elimination of, or other change in the covenants
     set forth in Article Ten which applies to Securities of the series;

          (20) any proposed listing on any national or foreign securities
     exchange of the Securities of the series; and

          (21) any other terms of the series (which terms shall not be
     inconsistent with the provisions of this Indenture, except as permitted by
     Section 901(5)).

          (c) All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or pursuant
to the Board Resolution referred to above and (subject to Section 303) set
forth, or determined in the manner provided, in the Officers' Certificate
referred to in paragraph (a) above or in any such indenture supplemental hereto.

          (d) If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be


                                      -27-


certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.

          (e) With respect to Securities of a series offered in a Periodic
Offering, the Board Resolution (or action taken pursuant thereto), Officers'
Certificate or supplemental indenture referred to above may provide general
terms or parameters for Securities of such series and provide either that the
specific terms of particular Securities of such series shall be specified in a
Company Order or that such terms shall be determined by the Company in
accordance with other procedures specified in a Company Order as contemplated by
Section 303(c).

          (f) Notwithstanding Section 301(b)(2) and unless otherwise expressly
provided with respect to a series of Securities, the aggregate principal amount
of a series of Securities may be increased and additional Securities of such
series may be issued up to the maximum aggregate principal amount authorized
with respect to such series as increased.

          (g) The Securities shall be subordinated in right of payment to Senior
Indebtedness as provided in Article Eleven.

Section 302. Denominations.

          The Securities of each series shall be issuable in registered form
without coupons in such denominations as shall be specified as contemplated by
Section 301. In the absence of any such provisions with respect to the
Securities of any series, the Securities of such series shall be issuable in
denominations of $1,000 and any integral multiple thereof.

Section 303. Execution, Authentication, Delivery and Dating.

          (a) The Securities shall be executed on behalf of the Company by its
Chairman, its Deputy Chairman, its President or one of its Vice Presidents. The
signature of any of these officers on the Securities may be manual or facsimile.

          (b) Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.



                                      -28-


          (c) At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Securities of any series executed by
the Company to the Trustee for authentication, together with a Company Order for
the authentication and delivery of such Securities, and the Trustee in
accordance with the Company Order shall authenticate and deliver such
Securities; provided, however, that in the case of Securities offered in a
Periodic Offering, the Trustee shall authenticate and deliver such Securities
from time to time in accordance with such other procedures (including, without
limitation, the receipt by the Trustee of oral or electronic instructions from
the Company or its duly authorized agents, promptly confirmed in writing)
acceptable to the Trustee as may be specified by or pursuant to a Company Order
delivered to the Trustee prior to the time of the first authentication of
Securities of such series. If the form or terms of the Securities of the series
have been established in or pursuant to one or more Board Resolutions as
permitted by Sections 201 and 301, in authenticating such Securities, and
accepting the additional responsibilities under this Indenture in relation to
such Securities, the Trustee shall be entitled to receive, and (subject to
Section 601) shall be fully protected in relying upon, an Opinion of Counsel
stating:

          (1) if the form of such Securities has been established by or pursuant
     to Board Resolution as permitted by Section 201, that such form has been
     established in conformity with the provisions of this Indenture;

          (2) if the terms of such Securities have been, or in the case of
     Securities of a series offered in a Periodic Offering, will be, established
     by or pursuant to a Board Resolution as permitted by Section 301, that such
     terms have been, or in the case of Securities of a series offered in a
     Periodic Offering, the manner of determining such terms have been,
     established in conformity with the provisions of this Indenture, subject,
     in the case of Securities of a series offered in a Periodic Offering, to
     any conditions specified in such Opinion of Counsel; and

          (3) that such Securities, when authenticated and delivered by the
     Trustee and issued by the Company in the manner and subject to any
     conditions specified in such Opinion of Counsel, will constitute valid and
     legally binding obligations of the Company, enforceable in accordance with
     their terms, subject to bankruptcy, insolvency, fraudulent transfer,
     reorganization, moratorium and similar laws of general applicability
     relating to or affecting the enforcement of creditors' rights and to
     general equity principles.

If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will


                                      -29-


affect the Trustee's own rights, duties or immunities under the Securities and
this Indenture or otherwise in a manner which is not reasonably acceptable to
the Trustee.

          (d)(i) Notwithstanding the provisions of Section 301 and of the
     preceding paragraph, if all Securities of a series are not to be originally
     issued at one time, it shall not be necessary to deliver the Officers'
     Certificate otherwise required pursuant to Section 301 or the Company Order
     and Opinion of Counsel otherwise required pursuant to such preceding
     paragraph at or prior to the time of authentication of each Security of
     such series if such documents are delivered at or prior to the time of
     authentication upon original issuance of the first Security of such series
     to be issued.

          (ii) with respect to Securities of a series offered in a Periodic
     Offering, the Trustee may rely, as to the authorization by the Company of
     any of such Securities, the form and terms thereof and the legality,
     validity, binding effect and enforceability thereof, upon the Opinion of
     Counsel and the other documents delivered pursuant to Sections 201 and 301
     and this Section, as applicable, in connection with the first
     authentication of Securities of such series.

          (e) Each Security shall be dated the date of its authentication.

          (f) No Security shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose unless there appears on such Security
a certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature of an authorized officer, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered hereunder
and is entitled to the benefits of this Indenture. Notwithstanding the
foregoing, if any Security shall have been authenticated and delivered hereunder
but never issued and sold by the Company, and the Company shall deliver such
Security to the Trustee for cancellation as provided in Section 309 together
with a written statement (which need not comply with Section 102 and need not be
accompanied by an Opinion of Counsel) stating that such Security has never been
issued and sold by the Company, for all purposes of this Indenture such Security
shall be deemed never to have been authenticated and delivered hereunder and
shall never be entitled to the benefits of this Indenture.

Section 304. Temporary Securities.

          (a) Pending the preparation of definitive Securities of any series,
the Company may execute, and upon Company Order the Trustee shall authenticate
and deliver, temporary Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions,


                                      -30-


omissions, substitutions and other variations as the officers executing such
Securities may determine, as evidenced by their execution of such Securities.

          (b) If temporary Securities of any series are issued, the Company will
cause definitive Securities of that series to be prepared without unreasonable
delay. After the preparation of definitive Securities of such series, the
temporary Securities of such series shall be exchangeable for definitive
Securities of such series upon surrender of the temporary Securities of such
series at the office or agency of the Company in a Place of Payment for that
series, without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Securities of any series the Company shall execute and the
Trustee shall authenticate and deliver in exchange therefor a like principal
amount of definitive Securities of the same series and of a like tenor of
authorized denominations. Until so exchanged the temporary Securities of any
series shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities of such series and tenor.

Section 305. Registration, Registration of Transfer and Exchange.

          (a) The Company shall cause to be kept at the Corporate Trust Office
of the Trustee a register (the register maintained in such office and in any
other office or agency of the Company in a Place of Payment being herein
sometimes collectively referred to as the "Security Register") in which, subject
to such reasonable regulations as it may prescribe, the Company shall provide
for the registration of Securities and of transfers of Securities. The Trustee
is hereby appointed "Security Registrar" for the purpose of registering
Securities and transfers of Securities as herein provided.

          (b) Upon surrender for registration of transfer of any Security of any
series at the office or agency in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
the same series, of any authorized denominations and of a like aggregate
principal amount and tenor.

          (c) At the option of the Holder, Securities of any series may be
exchanged for other Securities of the same series of any authorized
denominations and of a like aggregate principal amount and tenor, upon surrender
of the Securities to be exchanged at such office or agency. Whenever any
Securities are so surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Securities which the Holder making
the exchange is entitled to receive.

          (d) All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.



                                      -31-


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

          (f) No service charge shall be made for any registration of transfer
or exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities, other
than exchanges pursuant to Section 304, 906 or 1207 not involving any transfer.

          (g) If the Securities of any series (or of any series and specified
tenor) are to be redeemed in part, the Company shall not be required (i) to
issue, register the transfer of or exchange Securities of any series during a
period beginning at the opening of business 15 days before the day of the
mailing of a notice of redemption of Securities of that series selected for
redemption under Section 1203 and ending at the close of business on the day of
such mailing, or (ii) to register the transfer of or exchange any Security so
selected for redemption in whole or in part, except the unredeemed portion of
any Security being redeemed in part.

          (h) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated for such Global Security or
a nominee thereof and delivered to such Depositary or a custodian therefor, and
each such Global Security shall constitute a single Security for all purposes of
this Indenture . Notwithstanding the foregoing, except as otherwise specified as
contemplated by Section 301, no Global Security shall be registered for transfer
or exchange, or authenticated or delivered, pursuant to this Section 305 or
Sections 304, 306, 906 or 1207 in the name of a Person other than the Depositary
for such Security or its nominee until (i) the Depositary with respect to a
Global Security notifies the Company that it is unwilling or unable to continue
as Depositary for such Global Security or the Depositary ceases to be a clearing
agency registered under the Exchange Act and the Company notifies the Trustee
that it is unable to locate a qualified successor Depositary, (ii) the Company
executes and delivers to the Trustee a Company Order that such Global Security
shall be so transferable and exchangeable or (iii) there shall have occurred and
be continuing an Event of Default with respect to the Securities of such series.
Upon the occurrence in respect of any Global Security of any series of any one
or more of the conditions specified in clauses (i), (ii) or (iii) of the
preceding sentence or such other conditions as may be specified as contemplated
by Section 301 for such series, such Global Security may be registered for
transfer or exchange for Securities registered in the names of, or authenticated
and delivered to, such Persons as the Depositary with respect to such series
shall direct.



                                      -32-


          (i) Except as provided in the preceding paragraph, any Security
authenticated and delivered upon registration of transfer of, or in exchange
for, or in lieu of, any Global Security or any portion thereof, whether pursuant
to this Section, Section 304, 306, 906 or 1207 or otherwise, shall also be a
Global Security and bear the legend specified in Section 204. Notwithstanding
any other provision of this Indenture, a Global Security may not be transferred
except as a whole by the Depositary for such Global Security to a nominee of
such Depositary or to another Depositary or a nominee thereof or by a nominee of
such Depositary to such Depositary or another nominee of such Depositary or to
another Depositary or a nominee thereof.

Section 306. Mutilated, Destroyed, Lost and Stolen Securities.

          (a) If any mutilated Security is surrendered to the Trustee, the
Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.

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

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

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

          (e) Every new Security of any series issued pursuant to this Section
in lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of that series duly issued hereunder.



                                      -33-


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

Section 307. Payment of Interest; Interest Rights Preserved.

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

          (b) Any interest on any Security of any series which is payable, but
is not punctually paid or duly provided for, on any Interest Payment Date
(herein called "Defaulted Interest") shall forthwith cease to be payable to the
Holder on the relevant Regular Record Date by virtue of having been such Holder,
and such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:

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


                                      -34-


     been so mailed, such Defaulted Interest shall be paid to the Persons in
     whose names the Securities of such series (or their respective Predecessor
     Securities) are registered at the close of business on such Special Record
     Date and shall no longer be payable pursuant to the following Clause (2).

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

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

Section 308. Persons Deemed Owners.

          (a) Prior to due presentment of a 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 such Security is registered as the owner of
such Security for the purpose of receiving payment of principal of (and premium,
if any) and (subject to Section 307) interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.

          (b) Notwithstanding the foregoing, with respect to any Global
Security, nothing herein shall prevent the Company, the Trustee, or any agent of
the Company or the Trustee, from giving effect to any written certification,
proxy or other authorization furnished by any depositary, as a Holder, with
respect to such Global Security or impair, as between such depositary and owners
of beneficial interests in such Global Security, the operation of customary
practices governing the exercise of the rights of such depositary as a Holder of
such Global Security.

          (c) None of the Company, the Trustee or any agent of the Company or
the Trustee shall have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests in a Global Security or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.

Section 309. Cancellation.


                                      -35-


          All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly cancelled by it. The Company may at any time deliver to
the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery
to the Trustee) for cancellation any Securities previously authenticated
hereunder which the Company has not issued and sold, and all Securities so
delivered shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of in accordance with its
normal procedures unless otherwise directed by a Company Order.

Section 310. Computation of Interest.

          Except as otherwise specified as contemplated by Section 301 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.


                                  ARTICLE FOUR

                           Satisfaction and Discharge

Section 401. Satisfaction and Discharge of Indenture.

          (a) This Indenture shall upon Company Request cease to be of further
effect with respect to any series of Securities (except as to any surviving
rights of registration of transfer or exchange of Securities of such series
herein expressly provided for), and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging satisfaction and discharge of
this Indenture as to such series, when:

          (1) either

          (A) all Securities of such series theretofore authenticated and
     delivered (other than (i) Securities of such series which have been
     destroyed, lost or stolen and which have been replaced or paid as provided
     in Section 306 and (ii) Securities of such series for whose payment money
     has theretofore been deposited in trust or segregated and held in trust by
     the Company and thereafter repaid to the Company or discharged from such
     trust, as provided in Section 1003) have been delivered to the Trustee for
     cancellation; or



                                      -36-


          (B) all such Securities of such series not theretofore delivered to
     the Trustee for cancellation

               (i) have become due and payable, or

               (ii) will become due and payable at their Stated Maturity within
          one year, or

               (iii) are to be called for redemption within one year under
          arrangements satisfactory to the Trustee for the giving of notice of
          redemption by the Trustee in the name, and at the expense, of the
          Company,

          and the Company, in the case of (i), (ii) or (iii) above, has
          deposited or caused to be deposited with the Trustee as trust funds in
          trust for the purpose an amount sufficient to pay and discharge the
          entire indebtedness on the Securities of such series not theretofore
          delivered to the Trustee for cancellation, for principal (and premium,
          if any) and interest to the date of such deposit (in the case of
          Securities which have become due and payable) or to the Stated
          Maturity or Redemption Date, as the case may be;

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

          (3) the Company has delivered to the Trustee an Officers' Certificate
     and an Opinion of Counsel, each stating that all conditions precedent
     herein provided for relating to the satisfaction and discharge of this
     Indenture with respect to the relevant series of Securities have been
     complied with.

          (b) Notwithstanding the satisfaction and discharge of this Indenture,
the obligations of the Company to the Trustee under Section 607, the obligations
of the Trustee to any Authenticating Agent under Section 614 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.

Section 402. Application of Trust Money.



                                      -37-


          Subject to provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money has been deposited with the
Trustee. Money so held in trust under this Article Four shall not be subject to
the provisions of Article Eleven, provided the applicable conditions of Section
401 have been satisfied.


                                  ARTICLE FIVE

                                    Remedies

Section 501. Events of Default.

          "Event of Default", wherever used herein with respect to Securities of
any series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be occasioned by the provisions of Article
Eleven, or 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):

          (1) default in the payment of any interest upon any Security of that
     series when it becomes due and payable, and continuance of such default for
     a period of 30 days; or

          (2) default in the payment of the principal of (or premium, if any,
     on) any Security of that series at its Maturity; or

          (3) default in the deposit of any sinking fund payment, when and as
     due by the terms of a Security of that series; or

          (4) default in the performance, or breach, of any covenant or warranty
     of the Company in this Indenture (other than a covenant or warranty a
     default in whose performance or whose breach is elsewhere in this Section
     specifically dealt with or which has expressly been included in this
     Indenture solely for the benefit of a series of Securities other than that
     series), and continuance of such default or breach for a period of 60 days
     after there has been given, by registered or certified mail, to the Company
     by the Trustee or to the Company and the Trustee by the Holders of at least
     25% in principal amount of the Outstanding Securities of that series a
     written notice specifying such default or breach and


                                      -38-


     requiring it to be remedied and stating that such notice is a "Notice of
     Default" hereunder; or

          (5) a default under any bond, debenture, note or other evidence of
     indebtedness for money borrowed by the Company (including a default with
     respect to Securities of any series other than that series) having an
     aggregate principal amount outstanding of at least $50,000,000, or under
     any mortgage, indenture or instrument (including this Indenture) under
     which there may be issued or by which there may be secured or evidenced any
     indebtedness for money borrowed by the Company having an aggregate
     principal amount outstanding of at least $50,000,000, whether such
     indebtedness now exists or shall hereafter be created, which default shall
     have resulted in such indebtedness becoming or being declared due and
     payable prior to the date on which it would otherwise have become due and
     payable, without such acceleration having been rescinded or annulled within
     a period of 10 days after there shall have been given, by registered or
     certified mail, to the Company by the Trustee or to the Company and the
     Trustee by the Holders of at least 10% in principal amount of the
     Outstanding Securities of that series a written notice specifying such
     default and requiring the Company to cause such acceleration to be
     rescinded or annulled and stating that such notice is a "Notice of Default"
     hereunder; provided, however, that, subject to the provisions of Sections
     601 and 602, the Trustee shall not be deemed to have knowledge of such
     default unless either (A) a Responsible Officer of the Trustee shall have
     actual knowledge of such default or (B) the Trustee shall have received
     written notice thereof from the Company, from any Holder, from the holder
     of any such indebtedness or from the trustee under any mortgage, indenture
     or other instrument; or

          (6) the entry by a court having jurisdiction in the premises of (A) a
     decree or order for relief in respect of the Company in an involuntary case
     or proceeding under any applicable bankruptcy, insolvency, reorganization
     or other similar law or (B) a decree or order adjudging the Company a
     bankrupt or insolvent, or approving as properly filed a petition seeking
     reorganization, arrangement, adjustment or composition of or in respect of
     the Company under any applicable law, or appointing a custodian, receiver,
     liquidator, assignee, trustee, sequestrator or other similar official of
     the Company or of any substantial part of its property, or ordering the
     winding up or liquidation of its affairs, and the continuance of any such
     decree or order for relief or any such other decree or order unstayed and
     in effect for a period of 90 consecutive days; or

          (7) the commencement by the Company of a voluntary case or proceeding
     under any applicable federal or state bankruptcy, insolvency,


                                      -39-


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

          (8) any other Event of Default provided with respect to Securities of
     that series.

Section 502. Acceleration of Maturity; Rescission and Annulment.

          (a) If an Event of Default (other than an Event of Default specified
in Section 501(6) or 501(7)) with respect to Securities of any series at the
time Outstanding occurs and is continuing, then and in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series may declare the principal amount (or, if
any of the Securities of that series are Original Issue Discount Securities,
such portion of the principal amount of such Securities as may be specified in
the terms thereof) of all of the Securities of that series to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if given
by Holders), and upon any such declaration such principal amount (or specified
amount) shall become immediately due and payable. If an Event of Default
specified in Section 501(6) or 501(7) with respect to Securities of any series
at the time Outstanding occurs, the principal amount of all the Securities of
that series (or, if any Securities of that series are Original Issue Discount
Securities, such portion of the principal amount of such Securities as may be
specified by the terms thereof) shall automatically, and without any declaration
or other action on the part of the Trustee or any Holder, become immediately due
and payable.

          (b) At any time after such a declaration of acceleration with respect
to Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in principal amount of the
Outstanding Securities of that series,


                                      -40-


by written notice to the Company and the Trustee, may rescind and annul such
declaration and its consequences if

          (1) the Company has paid or deposited with the Trustee a sum
     sufficient to pay:

               (i) all overdue interest on all Securities of that series,

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

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

               (iv) all sums paid or advanced by the Trustee hereunder and the
          reasonable compensation, expenses, disbursements and advances of the
          Trustee, its agents and counsel;

     and

          (2) all Events of Default with respect to Securities of that series,
     other than the non-payment of the principal of Securities of that series
     which have become due solely by such declaration of acceleration, have been
     cured or waived as provided in Section 513.

No such rescission shall affect any subsequent default or impair any right
consequent thereon.

Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee.

          (a) The Company covenants that if

          (1) default is made in the payment of any interest on any Security
     when such interest becomes due and payable and such default continues for a
     period of 30 days, or

          (2) default is made in the payment of the principal of (or premium, if
     any, on) any Security at the Maturity thereof,



                                      -41-


the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal (and premium, if any) and interest and, to the extent
that payment of such interest shall be legally enforceable, interest on any
overdue principal (and premium, if any) and on any overdue interest, at the rate
or rates prescribed therefor in such Securities, 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 Trustee, its agents and counsel.

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

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

Section 504. Trustee May File Proofs of Claim.

          (a) In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee shall be entitled and empowered, by intervention in such
proceeding or otherwise, to take any and all action authorized under the Trust
Indenture Act in order to have the claims of the Holders and the Trustee allowed
in any such proceeding. In particular, the Trustee shall be authorized to
collect and receive any moneys or other property payable or deliverable on any
such claims and to distribute the same; and any custodian, receiver, assignee,
trustee, liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 607.



                                      -42-


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

Section 505. Trustee May Enforce Claims Without Possession of Securities.

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

Section 506. Application of Money Collected.

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

          FIRST: To the payment of all amounts due the Trustee under Section
607;

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

          THIRD: The balance, if any, to the Company.

Section 507. Limitation on Suits.

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



                                      -43-


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

          (2) the Holders of not less than 25% in principal amount of the
     Outstanding Securities of that series shall have made written request to
     the Trustee to institute proceedings in respect of such Event of Default in
     its own name as Trustee hereunder;

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

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

          (5) no direction inconsistent with such written request has been given
     to the Trustee during such 60-day period by the Holders of a majority in
     principal amount of the Outstanding Securities of that series;

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

Section 508. Unconditional Right of Holders to Receive Principal, Premium and
             Interest.

          Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of (and premium, if any) and (subject to
Section 307) interest on such Security on the Stated Maturity or Maturities
expressed in such Security (or, in the case of redemption, on the Redemption
Date) and to institute suit for the enforcement of any such payment, and such
rights shall not be impaired without the consent of such Holder.

Section 509. Restoration of Rights and Remedies.

          If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the


                                      -44-


Company, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.

Section 510. Rights and Remedies Cumulative.

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

Section 511. Delay or Omission Not Waiver.

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

Section 512. Control by Holders.

          The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred on the Trustee, with respect
to the Securities of such series, provided that

          (1) such direction shall not be in conflict with any rule of law or
     with this Indenture,

          (2) the Trustee may take any other action deemed proper by the Trustee
     which is not inconsistent with such direction, and

          (3) subject to the provisions of Section 601, the Trustee shall have
     the right to decline to follow any such direction if the Trustee in good
     faith shall, by a Responsible Officer or Officers of the Trustee, determine
     that the proceeding so directed would involve the Trustee in personal
     liability, for which the


                                      -45-


     security or indemnity offered pursuant to Section 603(e) would not be
     sufficient.

Section 513. Waiver of Past Defaults.

          (a) Subject to Section 502, the Holders of not less than a majority in
principal amount of the Outstanding Securities of any series may, on behalf of
the Holders of all the Securities of such series, by notice to the Trustee,
waive an existing or past default with respect to the Securities of such series
and its consequences, except a default

          (1) in the payment of principal of (or premium, if any) or interest on
     any Security of such series, or in the deposit of any sinking fund payment
     when and as due, or

          (2) in respect of a covenant or provision hereof which under Article
     Nine cannot be modified or amended without the consent of the Holder of
     each Outstanding Security of such series affected.

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

Section 514. Undertaking for Costs.

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

Section 515. Waiver of Stay or Extension Laws.

          The Company 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, which may affect the covenants or the
performance of this Indenture;


                                      -46-


and the Company (to the extent that it may lawfully do so) hereby expressly
waives all benefit or advantage of any such law and covenants that it will not
hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.


                                   ARTICLE SIX

                                   The Trustee

Section 601. Certain Duties and Responsibilities.

          The duties and responsibilities of the Trustee shall be as provided by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.

Section 602. Notice of Defaults.

          If a default known to the Trustee occurs hereunder with respect to the
Securities of any series, the Trustee shall transmit by mail to all Holders of
Securities of such series, as their names and addresses appear in the Security
Register by the time required by the Trust Indenture Act, notice of such default
hereunder, unless such default shall have been cured or waived; provided,
however, that, in the case of any default of the character specified in Section
501(4) with respect to Securities of such series, no such notice to Holders
shall be given until at least 30 days after the occurrence thereof. For the
purpose of this Section, the term "default" means any event which is, or after
notice or lapse of time or both would become, an Event of Default with respect
to Securities of such series.

Section 603. Certain Rights of Trustee.

          Subject to the provisions of Section 601:

          (a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of


                                      -47-


indebtedness or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;

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

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

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

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

          (f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney;
and

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

          (h) The Trustee shall not be deemed to have notice of a Default or an
Event of Default unless (a) the Trustee has received written notice thereof from
the Company or any Holder or (b) a Responsible Officer shall have actual
knowledge thereof; and



                                      -48-


          (i) For the avoidance of doubt, permissive rights of the Trustee
designated as such and enumerated herein shall not be construed as duties.

Section 604. Not Responsible for Recitals or Issuance of Securities.

          The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Securities, except that
the Trustee represents that it is duly authorized to execute and deliver this
Indenture, authenticate the Securities and perform its obligations hereunder and
that the statements made by it in a Statement of Eligibility on Form T-1
supplied to the Company are true and accurate, subject to the qualifications set
forth therein. Neither the Trustee nor any Authenticating Agent shall be
accountable for the use or application by the Company of Securities or the
proceeds thereof.

Section 605. May Hold Securities.

          The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
608 and 613, may otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other agent.

Section 606. Money Held in Trust.

          Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.

Section 607. Compensation and Reimbursement.

          (a) The Company agrees:

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

          (2) except as otherwise expressly provided herein, to reimburse the
     Trustee upon its request for all reasonable expenses, disbursements and
     advances incurred or made by the Trustee in accordance with any provision


                                      -49-


     of this Indenture (including the reasonable compensation and the expenses
     and disbursements of its agents and counsel), except any such expense,
     disbursement or advance as may be attributable to its negligence or bad
     faith; and

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

Section 608. Disqualification; Conflicting Interests.

          The Trustee for the Securities of any series issued hereunder shall be
subject to the provisions of Section 310(b) of the Trust Indenture Act during
the period of time provided for therein. In determining whether the Trustee has
a conflicting interest as defined in Section 310(b) of the Trust Indenture Act
with respect to the Securities of any specific series, this Indenture shall be
excluded with respect to Securities of any series of Securities other than that
specific series.

Section 609. Corporate Trustee Required; Eligibility.

          There shall at all times be one (and only one) Trustee hereunder with
respect to the Securities of each series, which may be a Trustee hereunder for
Securities of one or more other series and each of which shall be a corporation
organized and doing business under the laws of the United States of America, any
State thereof or the District of Columbia, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section and to the extent
permitted by the Trust Indenture Act, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect hereinafter specified
in this Article.

Section 610. Resignation and Removal; Appointment of Successor.

          (a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of


                                      -50-


appointment by the successor Trustee in accordance with the applicable
requirements of Section 611.

          (b) The Trustee may resign at any time with respect to the Securities
of one or more series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 611 shall
not have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.

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

          (d) If at any time:

          (1) the Trustee shall fail to comply with Section 608(a) after written
     request therefor by the Company or by any Holder who has been a bona fide
     Holder of a Security for at least six months, or

          (2) the Trustee shall cease to be eligible under Section 609 and shall
     fail to resign after written request therefor by the Company or by any such
     Holder, or

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

then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee with respect to all securities, or (ii) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.

          (e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, with
respect to the Securities of one or more series, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee or Trustees with respect
to the Securities of that or those series (it being understood that any such
successor Trustee may be appointed with respect


                                      -51-


to the Securities of one or more or all of such series and that at any time
there shall be only one Trustee with respect to the Securities of any particular
series) and shall comply with the applicable requirements of Section 611. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee with respect to the Securities
of any Series shall be appointed by Act of the Holders of a majority in
principal amount of the Outstanding Securities of such series delivered to the
Company and the retiring Trustee, the successor Trustee so appointed shall,
forthwith upon its acceptance of such appointment in accordance with the
applicable requirements of Section 611, become the successor Trustee with
respect to the Securities of such series and to that extent supersede the
successor Trustee appointed by the Company. If no successor Trustee with respect
to the Securities of any Series shall have been so appointed by the Company or
the Holders and accepted appointment in the manner required by Section 611, any
Holder who has been a bona fide Holder of a Security of such series 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 Trustee
with respect to the Securities of such series.

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

Section 611. Acceptance of Appointment by Successor.

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

          (b) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor


                                      -52-


Trustee shall accept such appointment and which (1) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Trustee all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series to which
the appointment of such successor Trustee relates, (2) if the retiring Trustee
is not retiring with respect to all Securities, shall contain such provisions as
shall be deemed necessary or desirable to confirm that all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series as to which the retiring Trustee is not retiring shall continue
to be vested in the retiring Trustee, and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee; and upon
the execution and delivery of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein and each such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those series
to which the appointment of such successor Trustee relates; but, on request of
the Company or any successor Trustee, such retiring Trustee shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates.

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

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

Section 612. Merger, Conversion, Consolidation or Succession to Business.

          Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided that
such corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have


                                      -53-


been authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and deliver the Securities so authenticated with
the same effect as if such successor Trustee had itself authenticated such
Securities.

Section 613. Preferential Collection of Claims Against Company.

          The Trustee shall comply with Section 311(a) of the Trust Indenture
Act with respect to each series of Securities for which it is Trustee.

Section 614. Appointment of Authenticating Agent.

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

          (b) Any corporation into which an Authenticating Agent may be merged
or converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided that such corporation shall be otherwise eligible
under this Section, without the


                                      -54-


execution or filing of any paper or any further act on the part of the Trustee
or the Authenticating Agent.

          (c) An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give written notice of
such appointment in the manner provided for in Section 106 to all Holders of
Securities of the series with respect to which such Authenticating Agent will
serve. Any successor Authenticating Agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.

          (d) The Trustee agrees to pay to each Authenticating Agent from time
to time reasonable compensation for its services under this Section and the
Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 607.

          (e) If an appointment with respect to one or more series is made
pursuant to this Section, the Securities of such series may have endorsed
thereon, in addition to the Trustee's certificate of authentication, an
alternate certificate of authentication in the following form:

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



                                              UNION BANK OF CALIFORNIA, N.A.,
                                                 as Trustee



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


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


                                      -55-


                                  ARTICLE SEVEN

                Holders' Lists and Reports by Trustee and Company

Section 701. Company to Furnish Trustee Names and Addresses of Holders.

          The Company will furnish or cause to be furnished to the Trustee:

          (a) semi-annually, not later than June 30 and December 31 in each
year, a list, in such form as the Trustee may reasonably require, of the names
and addresses of the Holders as of the preceding June 15 or December 15, as the
case may be, and

          (b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such list
is furnished;

excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar; provided that the Company shall not be obligated
to provide such a list of Holders at any time that such list would not differ
from the last such list provided by the Company to the Trustee under this
Section 701.

Section 702. Preservation of Information; Communications to Holders.

          (a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar.

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

          (c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of either of them shall be held accountable by reason of the
disclosure of any such information as to the names and addresses of the Holders
in accordance with Section 702(b), regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under Section 702(b).

Section 703. Reports by Trustee.


                                      -56-


          (a) The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to
Section 313(a) of the Trust Indenture Act at the times and in the manner
provided pursuant thereto. The Trustee shall also comply with the other
provisions of Section 313 of the Trust Indenture Act.

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

Section 704. Reports by Company.

          (a) The Company shall:

          (1) file with the Trustee, within 15 days after the Company 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 Company may be required to file
     with the Commission pursuant to Section 13 or Section 15(d) of the Exchange
     Act; or, if the Company is not required to file information, documents or
     reports pursuant to either of said Sections, then it shall file with the
     Trustee and the Commission, in accordance with rules and regulations
     prescribed from time to time by the Commission, such of the supplementary
     and periodic information, documents and reports which may be required
     pursuant to Section 13 of the Exchange Act in respect of a security listed
     and registered on a national securities exchange as may be prescribed from
     time to time in such rules and regulations;

          (2) file with the 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 Company with the conditions and covenants of this Indenture as may be
     required from time to time by such rules and regulations, including, in the
     case of annual reports, if required by such rules and regulations and to
     the extent required by the Trust Indenture Act, certificates or opinions of
     independent public accountants conforming to the requirements of Section
     102(b) as to compliance with conditions or covenants, compliance with which
     is subject to verification by accountants;

          (3) transmit by mail to all Holders, as their names and addresses
     appear in the Security Register, within 30 days after the filing thereof
     with the


                                      -57-


     Trustee, such summaries of any information, documents and reports required
     to be filed by the Company pursuant to paragraphs (1) and (2) of this
     Section as may be required by rules and regulations prescribed from time to
     time by the Commission; and

          (4) furnish to the Trustee, not less often than annually, a brief
     certificate from the principal executive officer, principal financial
     officer or principal accounting officer as to his or her knowledge of the
     Company's compliance with all conditions and covenants under this Indenture
     (which, for purposes of this paragraph, shall be determined without regard
     to any period of grace or requirement of notice provided under this
     Indenture).

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


                                  ARTICLE EIGHT

              Consolidation, Merger, Conveyance, Transfer or Lease

Section 801. Company May Consolidate, Etc., Only on Certain Terms.

          The Company shall not consolidate with or merge into any other Person
or convey, transfer or lease all or substantially all of its properties and
assets to any Person, and the Company shall not permit any Person to consolidate
with or merge into the Company or convey, transfer or lease all or substantially
all of its properties and assets to the Company, unless:

          (1) in case the Company shall consolidate with or merge into another
     Person or convey, transfer or lease all or substantially all of its
     properties and assets to any Person, the Person formed by or resulting from
     such consolidation or into which the Company is merged or the Person which
     acquires by conveyance or transfer, or which leases, all or substantially
     all of the properties and assets of the Company, shall be a corporation,
     partnership or trust or limited liability company organized and existing
     under the laws of the United States of America, any state thereof or the
     District of Columbia, and shall expressly assume, by an indenture (or
     indentures, if at such time there is more than one Trustee) supplemental
     hereto, executed by the successor Person and delivered to the Trustee the
     due and punctual payment of the principal of, any premium and


                                      -58-


     interest on all the Securities and the performance of every obligation in
     this Indenture and the Outstanding Securities on the part of the Company to
     be performed or observed;

          (2) immediately after giving effect to such transaction and treating
     any indebtedness which becomes an obligation of the Company or a Subsidiary
     as a result of such transaction as having been incurred by the Company or
     such Subsidiary at the time of such transaction, no Event of Default, and
     no event which, after notice or lapse of time or both, would become an
     Event of Default, shall have happened and be continuing;

          (3) if, as a result of any such consolidation or merger or such
     conveyance, transfer or lease, properties or assets of the Company would
     become subject to a mortgage, pledge, lien, security interest or other
     encumbrance which would not be permitted by this Indenture, the Company or
     such successor Person, as the case may be, shall take such steps as shall
     be necessary effectively to secure the Securities equally and ratably with
     (or prior to) all indebtedness secured thereby; and

          (4) the Company has delivered to the Trustee an Officers' Certificate
     and an Opinion of Counsel, each stating that such consolidation, merger,
     conveyance, transfer or lease and, if a supplemental indenture is required
     in connection with such transaction, such supplemental indenture comply
     with this Article and that all conditions precedent herein provided for
     relating to such transaction have been complied with.

Section 802. Successor Person Substituted.

          Upon any consolidation by the Company with or merger by the Company
into any other Person or any conveyance, transfer or lease of all or
substantially all of the properties and assets of the Company in accordance with
Section 801, the successor Person formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if such successor
Person had been named as the Company herein, and thereafter, except in the case
of a lease, the predecessor Person shall be relieved of all obligations and
covenants under this Indenture and the Securities.



                                      -59-



                                  ARTICLE NINE

                             Supplemental Indentures

Section 901. Supplemental Indentures without Consent of Holders.

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

          (1) to evidence the succession of another Person to the Company and
     the assumption by any such successor of the covenants of the Company herein
     and in the Securities; or

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

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

          (4) to add to or change any of the provisions of this Indenture to
     such extent as shall be necessary to permit or facilitate the issuance of
     Securities in bearer form, registerable or not registerable as to
     principal, and with or without interest coupons, or to permit or facilitate
     the issuance of Securities in uncertificated form; or

          (5) to add to, change or eliminate any of the provisions of this
     Indenture in respect of one or more series of Securities, provided that any
     such addition, change or elimination (A) shall neither (i) apply to any
     Security of any series created prior to the execution of such supplemental
     indenture and entitled to the benefit of such provision nor (ii) modify the
     rights of the Holder of any such Security with respect to such provision or
     (B) shall become effective only when there is no such Security Outstanding;
     or


                                      -60-


          (6) to establish the form or terms of Securities of any series as
     permitted by Sections 201 and 301; or

          (7) to evidence and provide for the acceptance of appointment
     hereunder by a successor Trustee with respect to the Securities of one or
     more series and to add to or change any of the provisions of this Indenture
     as shall be necessary to provide for or facilitate the administration of
     the trusts hereunder by more than one Trustee, pursuant to the requirements
     of Section 611(b); or

          (8) to add to or change any of the provisions of this Indenture with
     respect to any Securities that by their terms may be converted into
     securities or other property other than Securities of the same series and
     of like tenor, in order to permit or facilitate the issuance, payment or
     conversion of such Securities; or

          (9) to qualify or maintain qualification of this Indenture under the
     Trust Indenture Act; or

          (10) to cure any ambiguity, to correct or supplement any provision
     herein which may be defective or inconsistent with any other provision
     herein, or to make any other provisions with respect to matters or
     questions arising under this Indenture, provided such action shall not
     adversely affect the interests of the Holders of Securities of any series
     in any material respect.

Section 902. Supplemental Indentures with Consent of Holders.

          (a) With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders of Securities of such series under this Indenture; provided, however,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby,

          (1) change the Stated Maturity of the principal of, or any installment
     of principal of or interest on, any Security, or reduce the principal
     amount thereof or the rate of interest thereon or any premium payable upon
     the redemption thereof, or reduce the amount of the principal of an
     Original Issue Discount Security that would be due and payable upon a
     declaration of acceleration of the Maturity thereof pursuant to Section
     502, or change any Place of Payment where, or the coin or currency in
     which, any Security or any


                                      -61-


     premium or the interest thereon is payable, or impair the right to
     institute suit for the enforcement of any such payment on or after the
     Stated Maturity thereof (or, in the case of redemption, on or after the
     Redemption Date), or

          (2) reduce the percentage in principal amount of the Outstanding
     Securities of any series, the consent of whose Holders is required for any
     such supplemental indenture, or the consent of whose Holders is required
     for any waiver (of compliance with certain provisions of this Indenture or
     certain defaults hereunder and their consequences) provided for in this
     Indenture, or

          (3) modify any of the provisions of this Section, Section 513 or
     Section 1007, except to increase any such percentage or to provide that
     certain other provisions of this Indenture cannot be modified or waived
     without the consent of the Holder of each Outstanding Security affected
     thereby, provided, however, that this clause shall not be deemed to require
     the consent of any Holder with respect to changes in the references to "the
     Trustee" and concomitant changes in this Section and Section 1007, or the
     deletion of this proviso, in accordance with the requirements of Sections
     611(b) and 901(8).

          (b) A supplemental indenture which changes or eliminates any covenant
or other provision of this Indenture which has expressly been included solely
for the benefit of one or more particular series of Securities, or which
modifies the rights of the Holders of Securities of such series with respect to
such covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Securities of any other series.

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

Section 903. Execution of Supplemental Indentures.

          In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, in
addition to the documents required by Section 102, an Opinion of Counsel stating
that the execution of such supplemental indenture is authorized or permitted by
this Indenture. The Trustee may, but shall not be obligated to, enter into any
such supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.

Section 904. Effect of Supplemental Indentures.



                                      -62-


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

Section 905. Conformity with Trust Indenture Act.

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

Section 906. Reference in Securities to Supplemental Indentures.

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


                                   ARTICLE TEN

                                    Covenants

Section 1001. Payment of Principal, Premium and Interest.

          The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of (and premium,
if any) and interest on the Securities of that series in accordance with the
terms of the Securities and this Indenture.

Section 1002. Maintenance of Office or Agency.

          (a) The Company will maintain in each Place of Payment for any series
of Securities an office or agency where Securities of that series may be
presented or surrendered for payment, where Securities of that series may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Securities of that series and
this Indenture may be served. The Company will give prompt written notice to the
Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or


                                      -63-


served at the Corporate Trust Office of the Trustee, and the Company hereby
appoints the Trustee as its agent to receive all such presentations, surrenders,
notices and demands.

          (b) The Company may also from time to time designate one or more other
offices or agencies where the Securities of one or more series may be presented
or surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designation or rescission
shall in any manner relieve the Company of its obligation to maintain an office
or agency in each Place of Payment for Securities of any series for such
purposes. The Company will give prompt written notice to the Trustee of any such
designation or rescission and of any change in the location of any such other
office or agency.

Section 1003. Money for Securities Payments to Be Held in Trust.

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

          (b) Whenever the Company shall have one or more Paying Agents for any
series of Securities, it will, on or before each due date of the principal of
(and premium, if any) or interest on any Securities of that series, deposit with
a Paying Agent a sum sufficient to pay the principal (and premium, if any) or
interest so becoming due, such sum to be held in trust for the benefit of the
Persons entitled to such principal, premium or interest, and (unless such Paying
Agent is the Trustee) the Company will promptly notify the Trustee of its action
or failure so to act.

          (c) The Company will cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will (1) comply with the
provisions of the Trust Indenture Act applicable to it as a Paying Agent and (2)
during the continuance of any default by the Company (or any other obligor upon
the Securities of that series) in the making of any payment in respect of the
Securities of that series, upon the written request of the Trustee, forthwith
pay to the Trustee all sums held in trust by such Paying Agent for payment in
respect of the Securities of that series.

          (d) The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company


                                      -64-


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

          (e) Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of (and premium,
if any) or interest on any Security of any series and remaining unclaimed for
two years after such principal (and premium, if any) or interest has become due
and payable shall be paid to the Company on Company Request, or (if then held by
the Company) shall be discharged from such trust; and the Holder of such
Security shall thereafter, as an unsecured general creditor, look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease.

Section 1004. Corporate Existence.

          Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence and all licenses and permits material to the normal conduct of its
business; provided, however, that the Company shall not be required to preserve
any such right or franchise if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and that the loss thereof is not disadvantageous in any material
respect to the Holders.

Section 1005. [Reserved].

Section 1006. Statement by Officers as to Default.

          The Company will deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions, covenants and conditions of this Indenture (without regard to any
period of grace or requirement of notice provided hereunder), and if the Company
shall be in default, specifying all such defaults and the nature and status
thereof of which they may have knowledge.

Section 1007. Waiver of Certain Covenants.

          Except as otherwise specified as contemplated by Section 301 for
securities of such series, the Company may, with respect to the Securities of
any series,


                                      -65-


omit in any particular instance to comply with any term, provision or condition
set forth in any covenant provided pursuant to Section 301(b)(19), 901(2) or
901(7) for the benefit of the Holders of such series or in any of Sections 1002,
1004 and 1005, inclusive, if before the time for such compliance the Holders of
not less than a majority in principal amount of the Outstanding Securities of
such series shall, by Act of such Holders, either waive such compliance in such
instance or generally waive compliance with such term, provision or condition
but no such waiver contemplated by this Section 1007 shall extend to or affect
such term, provision or condition except to the extent so expressly waived, and,
until such waiver shall become effective, the obligations of the Company and the
duties of the Trustee in respect of any such term, provision or condition shall
remain in full force and effect.

Section 1008. Calculation of Original Issue Discount.

          The Company shall file with the Trustee as promptly as possible after
the end of each calendar year (i) a written notice specifying the amount of
original issue discount (including daily rates and accrual periods) accrued on
Outstanding Securities as of the end of such year and (ii) such other specific
information relating to such original issue discount as may then be relevant
under the Internal Revenue Code of 1986, as amended from time to time.


                                 ARTICLE ELEVEN

                           Subordination of Securities

Section 1101. Securities Subordinate to Senior Indebtedness.

          (a) The Company covenants and agrees, and each Holder of a Security,
by his acceptance thereof, likewise covenants and agrees, that, to the extent
and in the manner hereinafter set forth in this Article (subject to Article
Four), the payment of the principal of (and premium, if any) and interest on
each and all of the Securities are hereby expressly made subordinate and subject
in right of payment to the prior payment in full in cash of all Senior
Indebtedness.

          (b) This Article Eleven shall constitute a continuing offer to all
Persons who become holders of, or continue to hold, Senior Indebtedness, and
such provisions are made for the benefit of the holders of Senior Indebtedness
and such holders are made obligees hereunder and any one or more of them may
enforce such provisions. Holders of Senior Indebtedness need not prove reliance
on the subordination provisions hereof.

Section 1102. Payment Over of Proceeds Upon Dissolution, Etc.



                                      -66-


          (a) Upon any payment or distribution of assets of the Company to
creditors upon (i) any insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, reorganization or other similar case or proceeding in
connection therewith, relative to the Company or to its assets, or (ii) any
liquidation, dissolution or other winding up of the Company, whether voluntary
or involuntary and whether or not involving insolvency or bankruptcy, or (iii)
any assignment for the benefit of creditors or any other marshalling of assets
or liabilities of the Company, then and in any such event specified in (i), (ii)
or (iii) above (each such event, if any, herein sometimes referred to as a
"Proceeding");

          (A) the holders of Senior Indebtedness shall be entitled to receive
     payment in full in cash of all amounts due on or to become due on or in
     respect of all Senior Indebtedness, before the Holders of the Securities
     are entitled to receive any payment or distribution of any kind or
     character whether in cash, property or securities (including any payment or
     distribution which may be payable or deliverable to Holders of the
     Securities made in respect of any other indebtedness of the Company
     subordinated to the payment of the Securities, such payment or distribution
     being hereinafter referred to as a "Junior Subordinated Payment"), on
     account of the principal of or interest on the Securities or on account of
     any purchase, redemption or other acquisition of Securities by the Company,
     any Subsidiary of the Company, the Trustee or any Paying Agent (all such
     payments, distributions, purchases, redemptions and acquisitions, whether
     or not in connection with a Proceeding, herein referred to, individually
     and collectively, as a "Securities Payment"); and

          (B) any payment or distribution of assets of the Company of any kind
     or character, whether in cash, property or securities, by set-off or
     otherwise, to which the Holders of the Securities or the Trustee would be
     entitled but for the provisions of this Article Eleven (including, without
     limitation, any Junior Subordinated Payment) shall be paid by the
     liquidating trustee or agent or other Person making such payment or
     distribution, whether a trustee in bankruptcy, a receiver or liquidating
     trustee or otherwise, directly to the holders of Senior Indebtedness or
     their representative or representatives or to the trustee or trustees under
     any indenture under which any instruments evidencing any of such Senior
     Indebtedness may have been issued, ratably according to the aggregate
     amounts remaining unpaid on account of the Senior Indebtedness held or
     represented by each, to the extent necessary to make payment in full in
     cash of all Senior Indebtedness remaining unpaid, after giving effect to
     any concurrent payment to the holders of such Senior Indebtedness.



                                      -67-


          (b) In the event that, notwithstanding the foregoing provisions of
this Section, the Trustee or the Holder of any Security shall have received in
connection with any Proceeding any Securities Payment before all Senior
Indebtedness is paid in full or payment thereof provided for in cash, then and
in such event such Securities Payment shall be paid over or delivered forthwith
to the trustee in bankruptcy, receiver, liquidating trustee, custodian,
assignee, agent or other Person making payment or distribution of assets of the
Company for application to the payment of all Senior Indebtedness remaining
unpaid, to the extent necessary to pay all Senior Indebtedness in full in cash
after giving effect to any concurrent payment to or for the holders of Senior
Indebtedness.

          (c) For purposes of this Article only, the words "any payment or
distribution of any kind or character, whether in cash, property or securities"
shall not be deemed to include a payment or distribution of shares or securities
of the Company provided for by a plan of reorganization or readjustment
authorized by an order or decree of a court of competent jurisdiction in a
reorganization proceeding under any applicable bankruptcy law or of any other
corporation provided for by such plan of reorganization or readjustment which
shares or securities are subordinated in right of payment to all then
outstanding Senior Indebtedness to substantially the same extent, or to a
greater extent than, the Securities are so subordinated as provided in this
Article. The consolidation of the Company with, or the merger of the Company
into, another Person or the liquidation or dissolution of the Company following
the conveyance or transfer of all or substantially all of its properties and
assets as an entirety to another Person upon the terms and conditions set forth
in Article Eight shall not be deemed a Proceeding for the purposes of this
Section if the Person formed by such consolidation or into which the Company is
merged or the Person which acquires by conveyance or transfer such properties
and assets as an entirety, as the case may be, shall, as a part of such
consolidation, merger, conveyance or transfer, comply with the conditions set
forth in Article Eight.

Section 1103. No Payment When Senior Indebtedness in Default.

          (a) In the event that any Senior Payment Default (as defined below)
shall have occurred, then no Securities Payment shall be made, nor shall any
property of the Company or any Subsidiary of the Company be applied to the
purchase, acquisition, retirement or redemption of the Securities, unless and
until such Senior Payment Default shall have been cured or waived in writing or
shall have ceased to exist or all amounts then due and payable in respect of
such Senior Indebtedness (including amounts that have become and remain due by
acceleration) shall have been paid in full in cash. "Senior Payment Default"
means any default in the payment of principal of (or premium, if any) or
interest on any Senior Indebtedness when due, whether at the Stated Maturity of
any such payment or by declaration of acceleration of maturity, call for
redemption, mandatory payment or prepayment or otherwise.



                                      -68-


          (b) In the event that any Senior Nonmonetary Default (as defined
below) shall have occurred and be continuing, then, upon the receipt by the
Company and the Trustee of written notice of such Senior Nonmonetary Default
from the holder of such Senior Indebtedness (or the agent, trustee or
representative thereof), no Securities Payment shall be made, nor shall any
property of the Company or any Subsidiary of the Company be applied to the
purchase, acquisition, retirement or redemption of the Securities, during the
period (the "Payment Blockage Period") commencing on the date of such receipt of
such written notice and ending (subject to any blockage of payments that may
then or thereafter be in effect as the result of any Senior Payment Default) on
the earlier of (i) the date on which the Senior Indebtedness to which such
Senior Nonmonetary Default relates is discharged or such Senior Nonmonetary
Default shall have been cured or waived in writing or shall have ceased to exist
and any acceleration of Senior Indebtedness to which such Senior Nonmonetary
Default relates shall have been rescinded or annulled or (ii) the 179th day
after the date of such receipt of such written notice. No more than one Payment
Blockage Period may be commenced with respect to the Securities during any
period of 360 consecutive days and there shall be a period of at least 181
consecutive days in each period of 360 consecutive days when no Payment Blockage
Period is in effect. Following the commencement of any Payment Blockage Period,
the holders of any Senior Indebtedness will be precluded from commencing a
subsequent Payment Blockage Period until the conditions set forth in the
preceding sentence are satisfied. For all purposes of this paragraph, no Senior
Nonmonetary Default that existed or was continuing on the date of commencement
of any Payment Blockage Period with respect to the Senior Indebtedness
initiating such Payment Blockage Period shall be, or be made, the basis for the
commencement of a subsequent Payment Blockage Period by holders of Senior
Indebtedness or their representatives unless such Senior Nonmonetary Default
shall have been cured for a period of not less than 90 consecutive days. "Senior
Nonmonetary Default" means the occurrence or existence and continuance of any
default (other than a Senior Payment Default) or any event which, after notice
or lapse of time (or both), would become an Event of Default (other than a
Senior Payment Default), under the terms of any instrument or agreement pursuant
to which any Senior Indebtedness is outstanding, permitting (after notice or
lapse of time or both) one or more holders of such Senior Indebtedness (or a
trustee or agent on behalf of the holders thereof) to declare such Senior
Indebtedness due and payable prior to the date on which it would otherwise
become due and payable.

          (c) In the event that, notwithstanding the foregoing, the Company
shall make any payment to the Trustee or the Holder of any Security prohibited
by the foregoing provisions of this Section, and if such fact shall, at or prior
to the time of such payment, have been made known to the Trustee or, as the case
may be, such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.


                                      -69-


          (d) The provisions of this Section shall not apply to any Securities
Payment with respect to which Section 1102 hereof would be applicable.

Section 1104. Payment Permitted If No Default.

          Nothing contained in this Article or elsewhere in this Indenture or in
any of the Securities shall prevent the Company, at any time except during the
pendency of any Proceeding referred to in Section 1102 hereof or under the
conditions described in Section 1103 hereof, from making Securities Payments.

Section 1105. Subrogation to Rights of Holders of Senior Indebtedness.

          Subject to the payment in full in cash of all Senior Indebtedness, the
Holders of the Securities shall be subrogated (equally and ratably with the
holders of all indebtedness of the Company which by its express terms is
subordinated to indebtedness of the Company to substantially the same extent as
the Securities are subordinated and is entitled to like rights of subrogation)
to the rights of the holders of such Senior Indebtedness to receive payments and
distributions of cash, property and securities applicable to the Senior
Indebtedness until the principal of and interest on the Securities shall be paid
in full. For purposes of such subrogation, no payments or distributions to the
holders of the Senior Indebtedness of any cash, property or securities to which
the Holders of the Securities or the Trustee would be entitled except for the
provisions of this Article, and no payments over pursuant to the provisions of
this Article to the holders of Senior Indebtedness by Holders of the Securities
or the Trustee, shall, as among the Company, its creditors other than holders of
Senior Indebtedness and the Holders of the Securities, be deemed to be a payment
or distribution by the Company to or on account of the Senior Indebtedness.

Section 1106. Provisions Solely to Define Relative Rights.

          The provisions of this Article are and are intended solely for the
purpose of defining the relative rights of the Holders on the one hand and the
holders of Senior Indebtedness on the other hand. Nothing contained in this
Article or elsewhere in this Indenture or in the Securities is intended to or
shall (a) impair, as among the Company, its creditors other than holders of
Senior Indebtedness and the Holders of the Securities, the obligation of the
Company, which is absolute and unconditional (and which, subject to the rights
under this Article of the holders of Senior Indebtedness, is intended to rank
equally with all other general obligations of the Company), to pay to the
Holders of the Securities the principal of and interest on the Securities as and
when the same shall become due and payable in accordance with their terms; or
(b) affect the relative rights against the Company of the Holders of the
Securities and creditors of the Company other than the holders of Senior
Indebtedness; or (c) prevent the Trustee or the Holder of any


                                      -70-


Security from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, subject to the rights, if any, under this Article
of the holders of Senior Indebtedness to receive cash, property and securities
otherwise payable or deliverable to the Trustee or such Holder.

Section 1107. Trustee to Effectuate Subordination.

          Each Holder of a Security by his acceptance thereof authorizes and
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article and
appoints the Trustee his attorney-in-fact for any and all such purposes,
including, in the event of any dissolution, winding-up, liquidation or
reorganization of the Company whether in bankruptcy, insolvency, receivership
proceedings, or otherwise, the timely filing of a claim for the unpaid balance
of the indebtedness of the Company owing to such Holder in the form required in
such proceedings and the causing of such claim to be approved. If the Trustee
does not file a proper claim at least 30 days before the expiration of the time
to file such claim, then the holders of the Senior Indebtedness and their
agents, trustees or other representatives are authorized to do so (but shall in
no event be liable for any failure to do so) for and on behalf of the Holders of
the Securities.

Section 1108. No Waiver of Subordination Provisions.

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

          (b) Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article or
the obligations hereunder of the Holders of the Securities to the holders of
Senior Indebtedness, do any one or more of the following: (i) change the manner,
place or terms of payment or extend the time of payment of, or renew or alter,
Senior Indebtedness, or otherwise amend or supplement in any manner Senior
Indebtedness or any instrument evidencing the same or any agreement under which
Senior Indebtedness is outstanding; (ii) permit the Company to borrow, repay and
then reborrow any or all of the Senior Indebtedness; (iii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Indebtedness; (iv) release any Person liable in any manner for
the collection of Senior


                                      -71-


Indebtedness; (v) exercise or refrain from exercising any rights against the
Company and any other Person; and (vi) apply any sums received by them to Senior
Indebtedness.

Section 1109. Notice to Trustee.

          (a) The Company shall give prompt written notice to the Trustee of any
fact known to the Company which would prohibit the making of any payment to or
by the Trustee in respect of the Securities or that would end such prohibition.
Notwithstanding the provisions of this Article or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts which would prohibit the making of any payment to or by the Trustee in
respect of the Securities or that would end such prohibition, unless and until a
Responsible Officer of the Trustee shall have received written notice thereof
from the Company, any holder of Senior Indebtedness or from any trustee,
fiduciary or agent therefor; and, prior to the receipt of any such written
notice, the Trustee, subject to the provisions of Section 601 hereof, shall be
entitled in all respects to assume that no such facts exist; provided, however,
that if the Trustee shall not have received the notice of any prohibition
provided for in this Section at least three Business Days prior to the date upon
which by the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of or interest on
any Security), then, anything herein contained to the contrary notwithstanding,
but without limiting the rights and remedies of the holders of Senior
Indebtedness or any trustee, fiduciary or agent therefor, the Trustee shall have
full power and authority to receive such money and to apply the same to the
purpose for which such money was received and shall not be affected by any
notice to the contrary which may be received by it within two Business Days
prior to such date. Any notice required or permitted to be given to the Trustee
by a holder of Senior Indebtedness or by any agent, trustee or representative
thereof shall be in writing and shall be sufficient for every purpose hereunder
if in writing and either (i) sent via facsimile to the Trustee, the receipt of
which shall be confirmed via telephone, or (ii) mailed, first class postage
prepaid, or sent by overnight carrier, to the Trustee addressed to its Corporate
Trust Office or to any other address furnished in writing to such holder of
Senior Indebtedness by the Trustee.

          (b) Subject to the provisions of Section 601 hereof, the Trustee shall
be entitled to rely on the delivery to it of a written notice by a Person
representing himself to be a holder of Senior Indebtedness (or a trustee,
fiduciary or agent therefore) to establish that such notice has been given by a
holder of Senior Indebtedness or a trustee, fiduciary or agent therefor. In the
event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness to participate in any payment or distribution pursuant to this
Article, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which


                                      -72-


such Person is entitled to participate in such payment or distribution and any
other facts pertinent to the rights of such Person under this Article, and if
such evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.

          (c) Notwithstanding anything else contained herein, no notice, request
or other communication to or with the Trustee shall be deemed given unless
received by a Responsible Officer at the Corporate Trust Office.

Section 1110. Reliance on Judicial Order or Certificate of Liquidating Agent.

          Upon any payment or distribution of assets of the Company referred to
in this Article, the Trustee, subject to the provisions of Section 601 hereof,
and the Holders of the Securities shall be entitled to rely upon any order or
decree entered by any court of competent jurisdiction in which such Proceeding
is pending, or a certificate of the trustee in bankruptcy, receiver, liquidating
trustee, custodian, assignee for the benefit of creditors, agent or other Person
making such payment or distribution, delivered to the Trustee or to the Holders
of Securities, for the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article, provided that the foregoing shall
apply only if such court has been apprised of the provisions of this Article.

Section 1111. Trustee Not Fiduciary for Holders of Senior Indebtedness.

          The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness and shall not be liable to any such holders if it
shall in good faith mistakenly pay over or distribute to Holders of Securities
or to the Company or to any other Person cash, property or securities to which
any holders of Senior Indebtedness shall be entitled by virtue of this Article
or otherwise.

Section 1112. Rights of Trustee as Holder of Senior Indebtedness; Preservation
              of Trustee's Rights.

          (a) The Trustee in its individual capacity shall be entitled to all
the rights set forth in this Article with respect to any Senior Indebtedness
which may at any time be held by it, to the same extent as any other holder of
Senior Indebtedness, and nothing in this Indenture shall deprive the Trustee of
any of its rights as such holder.

          (b) Nothing in this Article shall apply to claims of, or payments to,
the Trustee under or pursuant to Section 607 hereof.



                                      -73-


Section 1113. Article Applicable to Paying Agents.

          In case at any time any Paying Agent other than the Trustee shall have
been appointed by the Company and be then acting hereunder, the term "Trustee"
as used in this Article shall in such case (unless the context otherwise
requires) be construed as extending to and including such Paying Agent within
its meaning as fully for all intents and purposes as if such Paying Agent were
named in this Article in addition to or in place of the Trustee; provided,
however, that Section 1111 hereof shall not apply to the Company or any
Affiliate of the Company if it or such Affiliate acts as Paying Agent.


                                 ARTICLE TWELVE

                            Redemption of Securities

Section 1201. Applicability of Article.

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

Section 1202. Election to Redeem; Notice to Trustee.

          The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution or in another manner specified as contemplated
by Section 301 for such Securities. In case of any redemption at the election of
the Company of less than all the Securities of any series (including any such
redemption affecting only a single Security), the Company shall, at least 60
days prior to the Redemption Date fixed by the Company (unless a shorter notice
shall be satisfactory to the Trustee), notify the Trustee of such Redemption
Date and of the principal amount of Securities of such series to be redeemed
and, if applicable, of the tenor of the Securities to be redeemed. In the case
of any redemption of Securities (A) prior to the expiration of any restriction
on such redemption provided in the terms of such Securities or elsewhere in this
Indenture or (B) pursuant to an election of the Company that is subject to a
condition specified in the terms of such Securities or elsewhere in this
Indenture, the Company shall furnish the Trustee with an Officers' Certificate
evidencing compliance with such restriction or condition.

Section 1203. Selection by Trustee of Securities to Be Redeemed.

          (a) If less than all the Securities of any series are to be redeemed
(unless all the Securities of such series and of a specified tenor are to be
redeemed or


                                      -74-


unless such redemption affects only a single Security), the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities of such series
not previously called for redemption, by such method as the Trustee shall deem
fair and appropriate and which may provide for the selection for redemption of a
portion of the principal amount of any Security of such series, provided that
the unredeemed portion of the principal amount of any Security shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security. If less than all the Securities of such series
and of a specified tenor are to be redeemed (unless such redemption affects only
a single Security), the particular Securities to be redeemed shall be selected
not more than 60 days prior to the Redemption Date by the Trustee, from the
Outstanding Securities of such series and specified tenor not previously called
for redemption in accordance with the preceding sentence.

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

          (c) The provisions of the two preceding paragraphs shall not apply
with respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.

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

Section 1204. Notice of Redemption.

          Notice of redemption shall be given in the manner provided in Section
106 not less than 30 days nor more than 60 days prior to the Redemption Date, to
each Holder of Securities to be redeemed, at his address appearing in the
Security Register.

          All notices of redemption shall state:

          (1) the Redemption Date,



                                      -75-


          (2) the Redemption Price or, if not then ascertainable, the manner of
     calculation thereof,

          (3) if less than all the Outstanding Securities of any series
     consisting of more than a single Security are to be redeemed, the
     identification (and, in the case of partial redemption of any such
     Securities, the principal amounts) of the particular Securities to be
     redeemed and, if less than all the Outstanding Securities of any series
     consisting of a single Security are to be redeemed, the principal amount of
     the particular Security to be redeemed,

          (4) the CUSIP numbers of the Securities to be redeemed,

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

          (6) the place or places where such Securities are to be surrendered
     for payment of the Redemption Price, and

          (7) that the redemption is for a sinking fund, if such is the case.

          Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.

Section 1205. Deposit of Redemption Price.

          On or prior to 10:00 a.m., New York City time, on any Redemption Date,
the Company shall deposit with the Trustee or with a Paying Agent (or, if the
Company is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 1003) an amount of money sufficient to pay the Redemption
Price of, and (except if the Redemption Date shall be an Interest Payment Date
unless otherwise specified as contemplated by Section 301) accrued interest on,
all the Securities which are to be redeemed on that date.

Section 1206. Securities Payable on Redemption Date.

          Notice of redemption having been given as aforesaid, the Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Company at the Redemption Price,


                                      -76-


together with accrued interest to the Redemption Date; provided, however, that,
unless otherwise specified as contemplated by Section 301, installments of
interest whose Stated Maturity is on or prior to the Redemption Date shall be
payable to the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the relevant Record
Dates according to their terms and the provisions of Section 307.

          If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.

Section 1207. Securities Redeemed in Part.

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


                                ARTICLE THIRTEEN

                                  Sinking Funds

Section 1301. Applicability of Article.

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

          The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a "mandatory sinking
fund payment", and any payment in excess of such minimum amount provided for by
the terms of Securities of any series is herein referred to as an "optional
sinking fund payment". If provided for by the terms of Securities of any series,
the cash amount of any sinking fund payment may be subject to reduction as
provided in Section 1302. Each sinking fund payment shall be applied to the
redemption of Securities of any series as provided for by the terms of
Securities of such series.



                                      -77-


Section 1302. Satisfaction of Sinking Fund Payments with Securities.

          The Company (1) may deliver Outstanding Securities of a series (other
than any previously called for redemption) and (2) may apply as a credit
Securities of a series which have been redeemed either at the election of the
Company pursuant to the terms of such Securities or through the application of
permitted optional sinking fund payments pursuant to the terms of such
Securities, in each case in satisfaction of all or any part of any sinking fund
payment with respect to the Securities of such series required to be made
pursuant to the terms of such Securities as provided for by the terms of such
series; provided that such Securities have not been previously so credited. Such
Securities shall be received and credited for such purpose by the Trustee at the
Redemption Price specified in such Securities for redemption through operation
of the sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.

Section 1303. Redemption of Securities for Sinking Fund.

          Not less than 60 days prior to each sinking fund payment date for any
series of Securities, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing sinking fund payment for
that series pursuant to the terms of that series, the portion thereof, if any,
which is to be satisfied by payment of cash and the portion thereof, if any,
which is to be satisfied by delivering and crediting Securities of that series
pursuant to Section 1302 and stating the basis for such credit and that such
Securities have not been previously so credited and will also deliver to the
Trustee any Securities to be so delivered. Not less than 30 days before each
such sinking fund payment date the Trustee shall select the Securities to be
redeemed upon such sinking fund payment date in the manner specified in Section
1203 and cause notice of the redemption thereof to be given in the name of and
at the expense of the Company in the manner provided in Section 1204. Such
notice having been duly given, the redemption of such Securities shall be made
upon the terms and in the manner stated in Sections 1206 and 1207.


                                ARTICLE FOURTEEN

                       Defeasance and Covenant Defeasance

Section 1401. Applicability of Article; Company's Option to Effect Defeasance or
              Covenant Defeasance.

          If pursuant to Section 301 provision is made for either or both of (a)
Defeasance of the Securities of a series under Section 1402 or (b) Covenant
Defeasance of the Securities of a series under Section 1403, then the provisions
of such Section or Sections, as the case may be, together with the other
provisions of this Article Fourteen,


                                      -78-


shall be applicable to the Securities of such series, and the Company may at its
option, at any time, with respect to the Securities of such series, elect to
have either Section 1402 (if applicable) or Section 1403 (if applicable) be
applied to the Outstanding Securities of such series upon compliance with the
conditions set forth below in this Article Fourteen. Any such election shall be
evidenced by a Board Resolution or in another manner specified as contemplated
by Section 301 for such Securities.

Section 1402. Defeasance and Discharge.

          Upon the Company's exercise of its option (if any) to have this
Section applied to any Securities or any series of Securities, as the case may
be, the Company shall be deemed to have been discharged from its obligations
with respect to such Securities as provided in this Section, and the provisions
of Article Eleven shall cease to be effective, on and after the date the
conditions set forth in Section 1404 are satisfied (hereinafter called
"Defeasance"). For this purpose, such Defeasance means that the Company shall be
deemed to have paid and discharged the entire indebtedness represented by such
Securities and to have satisfied all its other obligations under such Securities
and this Indenture insofar as such Securities are concerned (and the Trustee, at
the expense of the Company, shall execute proper instruments acknowledging the
same), subject to the following which shall survive until otherwise terminated
or discharged hereunder:

          (1) the rights of Holders of such Securities to receive, solely from
     the trust fund described in Section 1404 and as more fully set forth in
     such Section, payments in respect of the principal of and any premium and
     interest on such Securities when payments are due,

          (2) the Company's obligations with respect to such Securities under
     Sections 304, 305, 306, 1002 and 1003,

          (3) the rights, powers, trusts, duties and immunities of the Trustee
     hereunder, and

          (4) this Article Fourteen.

Subject to compliance with this Article Fourteen, the Company may exercise its
option (if any) to have this Section applied to any Securities notwithstanding
the prior exercise of its option (if any) to have Section 1403 applied to such
Securities.

Section 1403. Covenant Defeasance.



                                      -79-


          Upon the Company's exercise of its option (if any) to have this
Section applied to any Securities or any series of Securities, as the case may
be,

          (1) the Company shall be released from its obligations under Section
     801(3), and any covenants provided pursuant to Section 301(b)(19), 901(2)
     or 901(7) for the benefit of the Holders of such Securities, and

          (2) the occurrence of any event specified in Sections 501(4) (with
     respect to any of Section 801(3), and any such covenants provided pursuant
     to Section 301(b)(19), 901(2) or 901(7)) and 501(8) shall be deemed not to
     be or result in an Event of Default,

in each case with respect to such Securities as provided in this Section on and
after the date the conditions set forth in Section 1404 are satisfied
(hereinafter called "Covenant Defeasance"). For this purpose, such Covenant
Defeasance means that, with respect to such Securities, the Company may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such specified Section (to the extent so specified
in the case of Section 501(4)), whether directly or indirectly by reason of any
reference elsewhere herein to any such Section, Clause or Article or by reason
of any reference in any such Section, Clause or Article to any other provision
herein or in any other document, but the remainder of this Indenture and such
Securities shall be unaffected thereby. Following a Covenant Defeasance, payment
of the Securities of such series may not be accelerated because of or by
reference to the Sections specified above in this Section 1403.

Section 1404. Conditions to Defeasance or Covenant Defeasance.

          The following shall be the conditions precedent to application of
either Section 1402 or Section 1403 to the Outstanding Securities of such
series:

          (1) the Company shall irrevocably have deposited or caused to be
     deposited with the Trustee (or another trustee satisfying the requirements
     of Section 609 who shall agree to comply with the provisions of this
     Article Fourteen applicable to it) as trust funds in trust for the purpose
     of making the following payments, specifically pledged as security for, and
     dedicated solely to, the benefit of the Holders of such Securities,

               (i) money in an amount, or

               (ii) U.S. Government Obligations which through the scheduled
          payment of principal and interest in respect thereof in


                                      -80-


          accordance with their terms will provide, not later than one day
          before the due date of any payment, money in an amount, or

               (iii) a combination thereof,

     sufficient, in the opinion of a nationally recognized firm of independent
     public accountants expressed in a written certification thereof delivered
     to the Trustee (in case U.S. Government Obligations have so been
     deposited), to pay and discharge, and which shall be applied by the Trustee
     (or other qualifying trustee) to pay and discharge, (i) the principal of
     (and premium, if any) and interest on the Outstanding Securities of such
     series to maturity or redemption, as the case may be, and (ii) any
     mandatory sinking fund payments or analogous payments applicable to the
     Outstanding Securities of such series on the due dates thereof. Before such
     a deposit the Company may make arrangements satisfactory to the Trustee for
     the redemption of Securities at a future date or dates in accordance with
     Article Twelve, which shall be given effect in applying the foregoing. For
     this purpose, "U.S. Government Obligations" means securities that are (x)
     direct obligations of the United States of America for the payment of which
     its full faith and credit is pledged or (y) obligations of a Person
     controlled or supervised by and acting as an agency or instrumentality of
     the United States of America the payment of which is unconditionally
     guaranteed as a full faith and credit obligation by the United States of
     America, which, in either case, are not callable or redeemable at the
     option of the issuer thereof, and shall also include a depositary receipt
     issued by a bank (as defined in Section 3(a)(2) of the Securities Act) as
     custodian with respect to any such U.S. Government Obligation or a specific
     payment of principal of or interest on any such U.S. Government Obligation
     held by such custodian for the account of the holder of such depositary
     receipt, provided that (except as required by law) such custodian is not
     authorized to make any deduction from the amount payable to the holder of
     such depositary receipt from any amount received by the custodian in
     respect of the U.S. Government Obligation or the specific payment of
     principal of or interest on the U.S. Government Obligation evidenced by
     such depositary receipt.

          (2) In the event of an election to have Section 1402 apply to any
     Securities or any series of Securities, as the case may be, the Company
     shall have delivered to the Trustee an Opinion of Counsel stating that (A)
     the Company has received from, or there has been published by, the Internal
     Revenue Service a ruling or (B) since the date of this instrument, there
     has been a change in the applicable Federal income tax law, in either case
     (A) or (B) to the effect that, and based thereon such opinion shall confirm
     that, the Holders of such Securities will not recognize gain or loss for
     Federal income tax purposes


                                      -81-


     as a result of the deposit, Defeasance and discharge to be effected with
     respect to such Securities and will be subject to Federal income tax on the
     same amount, in the same manner and at the same times as would be the case
     if such deposit, Defeasance and discharge were not to occur.

          (3) In the event of an election to have Section 1403 apply to any
     Securities or any series of Securities, as the case may be, the Company
     shall have delivered to the Trustee an Opinion of Counsel to the effect
     that the Holders of such Securities will not recognize gain or loss for
     Federal income tax purposes as a result of the deposit and Covenant
     Defeasance to be effected with respect to such Securities and will be
     subject to Federal income tax on the same amount, in the same manner and at
     the same times as would be the case if such deposit and Covenant Defeasance
     were not to occur.

          (4) The Company shall have delivered to the Trustee an Officers'
     Certificate to the effect that neither such Securities nor any other
     Securities of the same series, if then listed on any securities exchange,
     will be delisted as a result of such deposit.

          (5) No Event of Default or event which with notice or lapse of time or
     both would become an Event of Default with respect to the Securities of
     such series shall have occurred and be continuing (A) on the date of such
     deposit or (other than an Event of Default resulting from the incurrence of
     indebtedness all or a portion of which the proceeds of which will be used
     to defease the Securities concurrently with such incurrence) (B) insofar as
     subsections 501(6) and (7) are concerned, at any time during the period
     ending on the 90th day after the date of such deposit or, if longer, ending
     on the day following the expiration of the longest preference period
     applicable to the Company in respect of such deposit (it being understood
     that the condition in this clause (B) is a condition subsequent and shall
     not be deemed satisfied until the expiration of such period).

          (6) Such Defeasance or Covenant Defeasance shall not (A) cause the
     Trustee for the Securities of such series to have a conflicting interest as
     defined in Section 608 or for purposes of the Trust Indenture Act with
     respect to any securities of the Company or (B) result in the trust arising
     from such deposit to constitute, unless it is qualified as, a regulated
     investment company under the Investment Company Act of 1940, as amended.

          (7) Such Defeasance or Covenant Defeasance shall not result in a
     breach or violation of, or constitute a default under, this Indenture or
     any other agreement or instrument to which the Company is a party or by
     which it is bound.



                                      -82-


          (8) No event or condition shall exist that, pursuant to the provisions
     of Article Eleven, would prevent the Company from making payments of the
     principal of (and any premium) or interest on the Securities of such series
     on the date of such deposit.

          (9) The Company shall have delivered to the Trustee an Opinion of
     Counsel substantially to the effect that (i) the trust funds deposited
     pursuant to this Section will not be subject to any rights of holders of
     Senior Indebtedness, including those arising under Article Eleven, and (ii)
     after the 90th day following the deposit, the trust funds will not be
     subject to the effect of any applicable bankruptcy, insolvency,
     reorganization or similar laws affecting creditors' rights generally,
     except that if a court were to rule under any such law in any case or
     proceeding that the trust funds remained property of the Company, no
     opinion is given as to the effect of such laws on the trust funds except
     the following: (A) assuming such trust funds remained in the possession of
     the trustee with whom such funds were deposited prior to such court ruling
     to the extent not paid to Holders of such Securities, such trustee would
     hold, for the benefit of such Holders, a valid and perfected security
     interest in such trust funds that is not avoidable in bankruptcy or
     otherwise, (B) such Holders would be entitled to receive adequate
     protection of their interests in such trust funds if such trust funds were
     used and (C) no property, rights in property or other interests granted to
     such trustee for the Trustee or such Holders in exchange for or with
     respect to any such funds would be subject to any prior rights of holders
     of Senior Indebtedness, including those arising under Article Eleven.

          (10) The Company shall have delivered to the Trustee an Officers'
     Certificate and an Opinion of Counsel, each stating that all conditions
     precedent provided for relating to either the Defeasance under Section 1402
     or the Covenant Defeasance under Section 1403 (as the case may be) have
     been complied with.

Section 1405. Deposited Money and U.S. Government Obligations to be Held in
              Trust; Other Miscellaneous Provisions.

          (a) Subject to the provisions of the last paragraph of Section 1003,
all money and U.S. Government Obligations (including the proceeds thereof)
deposited with the Trustee (or other qualifying trustee -- collectively, for
purposes of this Section 1405, the "Trustee") pursuant to Section 1404 in
respect of the Outstanding Securities of such series shall be held in trust and
applied by the Trustee, in accordance with the provisions of such Securities and
this Indenture, to the payment, either directly or through any Paying Agent (but
not including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of such Securities, of all sums due and to become



                                      -83-


due thereon in respect of principal (and premium, if any) and interest, but such
money need not be segregated from other funds except to the extent required by
law. Money and U.S. Government Obligations (including the proceeds thereof) so
held in trust shall not be subject to the provisions of Article Eleven, provided
that the applicable conditions of Section 1404 have been satisfied.

          (b) Anything herein to the contrary notwithstanding, the Trustee shall
deliver or pay to the Company from time to time upon Company Request any money
or U.S. Government Obligations held by it as provided in Section 1404 which, in
the opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee (in case
U.S. Government Obligations are so being held by the Trustee), are in excess of
the amount thereof which would then be required to be deposited to effect an
equivalent Defeasance or Covenant Defeasance.

Section 1406. Reinstatement.

          If the Trustee or the Paying Agent is unable to apply any money in
accordance with Section 1402 or 1403 by reason of any order or judgment or any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Company's obligations under the Securities of such
series shall be revived and reinstated as though no deposit had occurred
pursuant to this Article Fourteen until such time as the Trustee or Paying Agent
is permitted to apply all such money in accordance with Section 1402 or 1403;
provided, however, that if the Company makes any payment of principal of (and
premium, if any) any such Security following the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Securities to receive such payment from the money held by the Trustee or
the Paying Agent.

                            *    *    *    *    *

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


                                      -84-



          IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the day and year first above written.


                                         ORMAT TECHNOLOGIES, INC.


                                         By: /s/ Yehudit Bronicki
                                             -----------------------
                                             Name:  Yehudit Bronicki
                                             Title: Chief Executive Officer and
                                                    President


                                         UNION BANK OF CALIFORNIA, N.A.,
                                            as Trustee


                                         By: /s/ James V. Myers
                                             -----------------------
                                             Name:  James V. Myers
                                             Title: Trust Officer


                                      -85-

EX-5.1

Exhibit 5.1

30 Rockefeller Plaza, New York, NY 10112
tel (212) 408-5100 fax (212) 541-5369

CHADBOURNE & PARKE LLP

January 17, 2006

Opinion Letter

Ormat Technologies, Inc.
980 Greg Street
Sparks, Nevada 89431

Ladies and Gentlemen:

In connection with the registration under the Securities Act of 1933, as amended (the "Act"), by Ormat Technologies, Inc., a Delaware corporation (the "Company"), of (i) shares of the Company's common stock, par value $0.001 per share (the "Common Stock"), and the preferred share purchase rights related to the Common Stock (the "Rights") to be issued pursuant to the Rights Agreement, dated as of November 10, 2004 (the "Rights Agreement") between the Company and American Stock Transfer & Trust Company, as Rights Agent (the "Rights Agent") of the Company, (ii) senior and subordinated debt securities (the "Debt Securities"), (iii) warrants to purchase Common Stock and Debt Securities (the "Warrants"), and (iv) units comprised of one or more of the Company's Common Stock, Debt Securities and Warrants, in any combination (the "Units and, collectively with the Common Stock, the Rights, the Debt Securities and the Warrants, the "Securities") with an aggregate offering price of up to $1,000,000,000 or the equivalent thereof, to be offered and sold by the Company from time to time in accordance with Rule 415 under the Act, we, as your counsel, have examined such corporate records, certificates and other documents, and such questions of law, as we have considered necessary or appropriate for the purposes of this opinion.

Upon the basis of the foregoing, we advise you that, in our opinion:

1.    Common Stock.    When the Registration Statement relating to the Securities (the "Registration Statement") has become effective under the Act, the terms of sale of the Common Stock have been duly established in conformity with the Company's Second Amended Restated Certification of Incorporation, and when the Common Stock has been issued and sold as contemplated by the Registration Statement, any amendment thereto, the prospectus therein and any prospectus supplement relating thereto, the Common Stock will be validly issued, fully paid and nonassessable. The Common Stock covered by the opinion in this paragraph includes any shares of Common Stock that may be issued upon exercise or otherwise pursuant to the terms of any other Securities covered by the Registration Statement.

2.    Rights.    Assuming that the Rights Agreement has been duly authorized, executed and delivered by the Rights Agent, then when the Registration Statement has become effective under the Act and the Common Stock has been validly issued and sold as contemplated by the Registration Statement, the Rights attributable to the Securities will be validly issued. The Rights covered by the opinion in this paragraph include any Rights that may be issued upon exercise or otherwise pursuant to the terms of any other Securities covered by the Registration Statement.

3.    Debt Securities.    When the Registration Statement has become effective under the Act, the indentures relating to the Debt Securities have been duly authorized, executed and delivered, the terms of the Debt Securities and of their issuance and sale have been duly established in conformity with the applicable indenture so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company and when the Debt Securities have been duly executed and authenticated in accordance with the applicable indenture and issued and sold as contemplated in the Registration Statement, any

CHADBOURNE & PARKE LLP

Ormat Technologies, Inc. -2-     January 17, 2006

amendment thereto, the prospectus therein and any prospectus supplement relating thereto, the Debt Securities will constitute valid and legally binding obligations of the Company, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors' rights and to general equity principles. The Debt Securities covered by the opinion in this paragraph include any Debt Securities that may be issued upon exercise or otherwise pursuant to the terms of any other Securities covered by the Registration Statement.

4.    Warrants.    When the Registration Statement has become effective under the Act, the applicable warrant agreement has been duly authorized by the applicable warrant agent and duly executed and delivered by the Company and such warrant agent, the terms of the Warrants and of their issuance and sale have been duly established in conformity with the applicable warrant agreement so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company and when the Warrants have been duly executed, authenticated and delivered in accordance with such warrant agreement and as described in the Registration Statement, any amendment thereto, the prospectus therein and any prospectus supplement relating thereto, the Warrants will be legally and validly issued and will constitute the valid and binding obligations of the Company subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors' rights and to general equity principles. The Warrants covered by the opinion in this paragraph include any Warrants that may be issued upon exercise or otherwise pursuant to the terms of any other securities covered by the Registration Statement.

5.    Units.    When the Registration Statement has become effective under the Act, the terms of the unit agreements under which the Units are to be issued have been duly established and the unit agreements have been duly authorized, executed and delivered, when the terms of such Units and of their issuance and sale have been duly established in conformity with the applicable unit agreements so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company, and such Units have been duly executed and authenticated in accordance with the applicable unit agreements and issued and sold as contemplated in the Registration Statement, any amendment thereto, the prospectus therein and any prospectus supplement relating thereto, such Units will constitute valid and legally binding obligations of the Company, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors' rights and to general equity principles. The Units covered by the opinion in this paragraph include any Units, as the case may be, that may be issued upon exercise or otherwise pursuant to the terms of any other Securities covered by the Registration Statement.

In connection with our opinion set forth in paragraph (2) above, we note that the question whether the Board of Directors of the Company might be required to redeem the Rights at some future time will depend upon the facts and circumstances existing at that time and, accordingly, is beyond the scope of such opinion.

The foregoing opinion is limited to the Federal laws of the United States, the laws of the State of New York and the Delaware General Corporation law, the applicable provisions of the Delaware Constitution and reported judicial decisions interpreting these laws and we are expressing no opinion as to the effect of the laws of any other jurisdiction.

CHADBOURNE & PARKE LLP

Ormat Technologies, Inc. -3-     January 17, 2006

We are expressing no opinion as to any obligations that parties other than the Company may have under or in respect of the Securities covered by the Registration Statement or as to the effect that their performance of such obligations may have upon any of the matters referred to above.

We have relied as to certain matters on information obtained from public officials, officers of the Company and other sources believed by us to be responsible.

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to us under the heading "Validity of Securities" in the Registration Statement and the prospectus therein. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act.

Very truly yours,
    
    
    
/s/ Chadbourne & Parke LLP

EX-12.1

Exhibit 12.1

Ormat Technologies, Inc.
STATEMENT OF COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Amounts in thousands of dollars)

				Nine Months Ended September 30, 2005				Year Ended December 31,
								2004				2003				2002				2001				2000
EARNINGS AVAILABLE TO COVER FIXED CHARGES:
Income from continuing operations before income taxes, minority interest, and equity in income of investees				$	24,660			$	20,941			$	18,125			$	15,529			$	1,812			$	10,487
Less:
Interest capitalized					(3,215	)			(628	)			(297	)			(201	)			(974	)			(780	)
Add:
Fixed charges deducted from earnings (see below)					32,849				43,622				8,626				6,589				5,516				4,689
Distributed income of equity investees					4,558				3,996				—				—				—				—
Earnings available to cover fixed charges				$	58,852			$	67,931			$	26,454			$	21,917			$	6,354			$	14,396
FIXED CHARGES:
Interest expensed and capitalized and amortized premiums, discounts and capitalized expenses related to indebtedness				$	32,026			$	43,413			$	8,417			$	6,380			$	5,307			$	4,480
Interest within rent expense					823				209				209				209				209				209
Fixed charges				$	32,849			$	43,622			$	8,626			$	6,589			$	5,516			$	4,689
Ratio of Earnings to Fixed Charges					1.79				1.56				3.07				3.33				1.15				3.07

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in this Registration Statement on Form S-3 of our report dated March 21, 2005, except for Note 19 as to which the date is March 25, 2005 relating to the financial statements, which appears in Ormat Technologies, Inc.'s Annual Report on Form 10-K/A for the year ended December 31, 2004. We also consent to the reference to us under the heading ‘‘Experts’’ in such Registration Statement.

/s/ PricewaterhouseCoopers LLP

Sacramento, California
January 13, 2006

EX-25.1

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY UNDER
THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
Check if an Application to Determine Eligibility of
a Trustee Pursuant to Section 305(b)(2)

UNION BANK OF CALIFORNIA, NATIONAL ASSOCIATION
(Exact name of Trustee as specified in its charter)

94-0304228
I.R.S. Employer Identification No.

400 California Street San Francisco, California				94104
(Address of principal executive offices)				(Zip Code)

Douglas J. Schlafer
Union Bank of California, N.A.
350 California Street
Corporate Trust – 11^th Floor
San Francisco, CA 94104
(415) 273-2519
(Name, address and telephone number of agent for service)

Ormat Technologies, Inc.
(Issuer with respect to the Securities)

Delaware				88-0326081
(State or other jurisdiction of incorporation or organization)				(I.R.S. Employer Identification No.)
980 Greg Street Sparks, NV				89431
(Address of Principal Executive Offices)				(Zip Code)

Senior Debt Securities

FORM T-1

Item 1.	GENERAL INFORMATION.    Furnish the following information as to the Trustee.

	a)	Name and address of each examining or supervising authority to which it is subject.

Comptroller of the Currency
Washington, D.C.

	b)	Whether it is authorized to exercise corporate trust powers.

Trustee is authorized to exercise corporate trust powers.

Item 2.	AFFILIATIONS WITH OBLIGOR.    If the obligor is an affiliate of the Trustee, describe each such affiliation.

None

In answering this item, the trustee has relied, in part, upon information furnished by the obligor and the underwriters, and the trustee disclaims responsibility for the accuracy or completeness of such information. The trustee has also examined its own books and records for the purpose of answering this item.

Items 3-15	Items 3-15 are not applicable because to the best of the Trustee's knowledge, the obligor is not in default under any Indenture for which the Trustee acts as Trustee.

Item 16.	LIST OF EXHIBITS:    List below all exhibits filed as a part of this statement of eligibility and qualification.

	1.	A copy of the Articles of Association of the Trustee.*

	2.	A copy of the certificate of authority of the Trustee to commence business.*

	3.	A copy of the certificate of authority of the Trustee to exercise corporate trust powers.*

	4.	A copy of the existing bylaws of the Trustee.*

	5.	Not applicable.

	6.	The consent of the Trustee required by Section 321(b) of the Trust Indenture Act of 1939. Attached as Exhibit 6.

	7.	A copy of the latest report of condition of the trustee published pursuant to law or the requirements of its supervising or examining authority. Attached as Exhibit 7.

	8.	Not applicable.

	9.	Not applicable.

*	Exhibits 1 through 4 are incorporated by reference to Form T-1 as presented on S-4 Registration No. 333-103873 filed with the SEC.

2

NOTE

The answers to this statement insofar as such answers relate to what persons have been underwriters for any securities of the obligors within three years prior to the date of filing this statement, or what persons are owners of 10% or more of the voting securities of the obligors, or affiliates, are based upon information furnished to the Trustee by the obligors. While the Trustee has no reason to doubt the accuracy of any such information, it cannot accept any responsibility therefor.

SIGNATURE

Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the Trustee, Union Bank of California, National Association, a national banking association organized and existing under the laws of the United States of America, has duly caused this statement of eligibility and qualification to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of San Francisco, State of California on the 13th day of January, 2006.

Union Bank of California, N.A.

	By:	/s/ Ralph Renninghoff                 Ralph Renninghoff Vice President

3

Exhibit 6

CONSENT OF THE TRUSTEE
REQUIRED BY SECTION 321(b) OF THE ACT

January 13, 2006

Securities and Exchange Commission
Washington, D.C. 20549

Ladies and Gentlemen:

In connection with the qualification of an indenture for senior indebtedness between Ormat Technologies, Inc. (the ‘‘Company’’) and Union Bank of California, N.A. (the ‘‘Trustee’’), the undersigned, in accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby consents that reports of examinations of the undersigned by federal, state, territorial, or district authorities authorized to make such examinations may be furnished by such authorities to the Securities and Exchange Commission upon request therefor.

Sincerely,

Union Bank of California, N.A.

By:   /s/ Ralph Renninghoff                
Ralph Renninghoff
Corporate Trust Vice President

Exhibit 7
Page 1

Consolidated Report of Condition of

Union Bank of California, National Association

of San Francisco in the State of California, at the close of business September 30, 2005, published in response to call made by the Comptroller of the Currency, under Title 12, United States Code, Section 161. Charter 21541

BALANCE SHEET

				Dollar Amounts in Thousands
ASSETS
Cash and balances due from depository institutions:
Non-interest-bearing balances and currency and coin				$	2,240,882
Interest-bearing balances					674,159
Securities:
Held-to-maturity securities					0
Available-for-sale securities					9,821,368
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices					1,452,200
Securities purchased under agreements to resell					1,993
Loans and lease financing receivables:
Loans and leases held for sale					11,135
Loans and leases, net of unearned income					32,941,898
LESS: Allowance for loan and lease losses					339,976
Loans and leases, net of unearned income and allowance					32,601,922
Trading assets					379,711
Premises and fixed assets					500,985
Other real estate owned					2,527
Investments in unconsolidated subsidiaries and associated companies					163
Customers’ liability to this bank on acceptances outstanding					95,205
Intangible assets:
Goodwill					452,617
Other intangible assets					47,662
Other assets					2,304,338
Total assets					50,586,870

Exhibit 7
Page 2

				Dollar Amounts in Thousands
LIABILITIES
Deposits:
In domestic offices				$	41,205,236
Noninterest-bearing					20,639,508
Interest-bearing					20,565,728
In foreign offices, Edge and Agreement subsidiaries, and IBFs					2,923,785
Noninterest-bearing					409,886
Interest-bearing					2,513,899
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices					199,760
Securities sold under agreements to repurchase					157,965
Trading liabilities					251,751
Other borrowed money					112,134
Bank’s liability on acceptances executed and outstanding					95,205
Subordinated notes and debentures					100,000
Other liabilities					1,081,702
Total liabilities					46,127,538
Minority interest in consolidated subsidiaries					0
EQUITY CAPITAL
Perpetual preferred stock and related surplus					0
Common stock					604,577
Surplus					1,492,948
Retained earnings					2,484,717
Accumulated other comprehensive income					(122,910	)
Other equity capital components					0
Total equity capital					4,459,332
Total liabilities, minority interest, and equity capital					50,586,870

EX-25.2

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY UNDER
THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
Check if an Application to Determine Eligibility of
a Trustee Pursuant to Section 305(b)(2)

UNION BANK OF CALIFORNIA, NATIONAL ASSOCIATION
(Exact name of Trustee as specified in its charter)

94-0304228
I.R.S. Employer Identification No.

400 California Street San Francisco, California				94104
(Address of principal executive offices)				(Zip Code)

Douglas J. Schlafer
Union Bank of California, N.A.
350 California Street
Corporate Trust – 11^th Floor
San Francisco, CA 94104
(415) 273-2519
(Name, address and telephone number of agent for service)

Ormat Technologies, Inc.
(Issuer with respect to the Securities)

Delaware				88-0326081
(State or other jurisdiction of incorporation or organization)				(I.R.S. Employer Identification No.)
980 Greg Street Sparks, NV				89431
(Address of Principal Executive Offices)				(Zip Code)

Subordinated Debt Securities

FORM T-1

Item 1.	GENERAL INFORMATION.    Furnish the following information as to the Trustee.

	a)	Name and address of each examining or supervising authority to which it is subject.

Comptroller of the Currency
Washington, D.C.

	b)	Whether it is authorized to exercise corporate trust powers.

Trustee is authorized to exercise corporate trust powers.

Item 2.	AFFILIATIONS WITH OBLIGOR.    If the obligor is an affiliate of the Trustee, describe each such affiliation.

None

In answering this item, the trustee has relied, in part, upon information furnished by the obligor and the underwriters, and the trustee disclaims responsibility for the accuracy or completeness of such information. The trustee has also examined its own books and records for the purpose of answering this item.

Items 3-15	Items 3-15 are not applicable because to the best of the Trustee's knowledge, the obligor is not in default under any Indenture for which the Trustee acts as Trustee.

Item 16.	LIST OF EXHIBITS:    List below all exhibits filed as a part of this statement of eligibility and qualification.

	1.	A copy of the Articles of Association of the Trustee.*

	2.	A copy of the certificate of authority of the Trustee to commence business.*

	3.	A copy of the certificate of authority of the Trustee to exercise corporate trust powers.*

	4.	A copy of the existing bylaws of the Trustee.*

	5.	Not applicable.

	6.	The consent of the Trustee required by Section 321(b) of the Trust Indenture Act of 1939. Attached as Exhibit 6.

	7.	A copy of the latest report of condition of the trustee published pursuant to law or the requirements of its supervising or examining authority. Attached as Exhibit 7.

	8.	Not applicable.

	9.	Not applicable.

*	Exhibits 1 through 4 are incorporated by reference to Form T-1 as presented on S-4 Registration No. 333-103873 filed with the SEC.

2

NOTE

The answers to this statement insofar as such answers relate to what persons have been underwriters for any securities of the obligors within three years prior to the date of filing this statement, or what persons are owners of 10% or more of the voting securities of the obligors, or affiliates, are based upon information furnished to the Trustee by the obligors. While the Trustee has no reason to doubt the accuracy of any such information, it cannot accept any responsibility therefor.

SIGNATURE

Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the Trustee, Union Bank of California, National Association, a national banking association organized and existing under the laws of the United States of America, has duly caused this statement of eligibility and qualification to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of San Francisco, State of California on the 13th day of January, 2006.

Union Bank of California, N.A.

	By:	/s/ Ralph Renninghoff                 Ralph Renninghoff Vice President

3

Exhibit 6

CONSENT OF THE TRUSTEE
REQUIRED BY SECTION 321(b) OF THE ACT

January 13, 2006

Securities and Exchange Commission
Washington, D.C. 20549

Ladies and Gentlemen:

In connection with the qualification of an indenture for subordinated indebtedness between Ormat Technologies, Inc. (the ‘‘Company’’) and Union Bank of California, N.A. (the ‘‘Trustee’’), the undersigned, in accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby consents that reports of examinations of the undersigned by federal, state, territorial, or district authorities authorized to make such examinations may be furnished by such authorities to the Securities and Exchange Commission upon request therefor.

Sincerely,

Union Bank of California, N.A.

By:	/s/ Ralph Renninghoff                 Ralph Renninghoff Corporate Trust Vice President

Exhibit 7
Page 1

Consolidated Report of Condition of

Union Bank of California, National Association

of San Francisco in the State of California, at the close of business September 30, 2005, published in response to call made by the Comptroller of the Currency, under Title 12, United States Code, Section 161. Charter 21541

BALANCE SHEET

				Dollar Amounts in Thousands
ASSETS
Cash and balances due from depository institutions:
Non-interest-bearing balances and currency and coin				$	2,240,882
Interest-bearing balances					674,159
Securities:
Held-to-maturity securities					0
Available-for-sale securities					9,821,368
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices					1,452,200
Securities purchased under agreements to resell					1,993
Loans and lease financing receivables:
Loans and leases held for sale					11,135
Loans and leases, net of unearned income					32,941,898
LESS: Allowance for loan and lease losses					339,976
Loans and leases, net of unearned income and allowance					32,601,922
Trading assets					379,711
Premises and fixed assets					500,985
Other real estate owned					2,527
Investments in unconsolidated subsidiaries and associated companies					163
Customers’ liability to this bank on acceptances outstanding					95,205
Intangible assets:
Goodwill					452,617
Other intangible assets					47,662
Other assets					2,304,338
Total assets					50,586,870

Exhibit 7
Page 2

				Dollar Amounts in Thousands
LIABILITIES
Deposits:
In domestic offices				$	41,205,236
Noninterest-bearing					20,639,508
Interest-bearing					20,565,728
In foreign offices, Edge and Agreement subsidiaries, and IBFs					2,923,785
Noninterest-bearing					409,886
Interest-bearing					2,513,899
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices					199,760
Securities sold under agreements to repurchase					157,965
Trading liabilities					251,751
Other borrowed money					112,134
Bank’s liability on acceptances executed and outstanding					95,205
Subordinated notes and debentures					100,000
Other liabilities					1,081,702
Total liabilities					46,127,538
Minority interest in consolidated subsidiaries					0
EQUITY CAPITAL
Perpetual preferred stock and related surplus					0
Common stock					604,577
Surplus					1,492,948
Retained earnings					2,484,717
Accumulated other comprehensive income					(122,910	)
Other equity capital components					0
Total equity capital					4,459,332
Total liabilities, minority interest, and equity capital					50,586,870