S-3

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As filed with the Securities and Exchange Commission on January 15, 2003

Registration Nos. 333-          and 333-          -01

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM S-3
Registration Statement
under the
Securities Act of 1933

CINERGY CORP. (Exact name of registrant as specified in its charter)	CC FUNDING TRUST II (Exact name of registrant as specified in its charter)
Delaware (State or other jurisdiction of incorporation or organization)	Delaware (State or other jurisdiction of incorporation or organization)
31-1385023 (I.R.S. Employer Identification No.)	38-6808544 (I.R.S. Employer Identification No.)
139 East Fourth Street Cincinnati, OH 45202 (513) 421-9500 (Address, including zip code, and telephone number, including area code of registrant's principal executive offices)	139 East Fourth Street Cincinnati, OH 45202 (513) 421-9500 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)

Wendy L. Aumiller
Treasurer
Cinergy Corp.
139 East Fourth Street
Cincinnati, OH 45202
(513) 421-9500
(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Bradley C. Arnett, Esq.
Senior Counsel
Cinergy Corp.
139 East Fourth Street
Cincinnati, OH 45202 Timothy E. Hoberg, Esq.
Tracey A. Chriske, Esq.
Taft, Stettinius & Hollister LLP
425 Walnut Street
Suite 1800
Cincinnati, OH 45202

        Approximate Date of Commencement of Proposed Sale to the Public: From time to time after the registration statement becomes effective, as determined by market and other conditions.

        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. ý

        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 delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. / /

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Proposed Maximum Aggregate Offering Price(1)(2)(3)	Amount of Registration Fee
Cinergy Corp. Common Stock, par value $0.01
Cinergy Corp. Preferred Stock
Cinergy Corp. Stock Purchase Contracts
Cinergy Corp. Stock Purchase Units(4)
Cinergy Corp. Debt Securities
CC Funding Trust II Preferred Trust Securities
Cinergy Corp. Guarantee ("Preferred Securities Guarantee") of CC Funding Trust II Preferred Trust Securities(5)
Total(4)(5)	$750,000,000	$69,000

(Footnotes on following page)

These Registrants hereby amend this Registration Statement on such date or dates as may be necessary to delay its Effective Date until the Registrants 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 Commission, acting pursuant to said Section 8(a), may determine.

(Footnotes for preceding page)

(1)

There are being registered hereunder such presently indeterminate principal amount or number of (a) shares of Common Stock, Preferred Stock, Stock Purchase Contracts and Stock Purchase Units which may be sold from time to time by Cinergy Corp., (b) Senior Debt Securities and Junior Subordinated Debt Securities ("Debt Securities") which may be sold from time to time by Cinergy Corp., and (c) Preferred Trust Securities which may be sold from time to time by CC Funding Trust II, and which will be guaranteed as set forth hereunder by Cinergy Corp. In no event will the aggregate initial offering price of all Common Stock, Preferred Stock, Stock Purchase Contracts, Stock Purchase Units, Debt Securities or Preferred Trust Securities and related Preferred Securities Guarantee ("Securities") issued from time to time pursuant to this Registration Statement exceed $750,000,000. If any such securities are issued at an original issue discount, then the aggregate initial offering price as so discounted shall not exceed $750,000,000, notwithstanding that the stated principal amount of such securities may exceed such amount. In addition, there are being registered hereunder an indeterminate number of shares of Common Stock issuable upon settlement of the Stock Purchase Contracts or upon conversion of any other Securities.

(2)

Estimated solely for the purpose of determining the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended. The proposed maximum initial offering price per security will be determined, from time to time, by the registrants in connection with the issuance of the Securities.

(3)

Exclusive of accrued interest or dividends, if any.

(4)

Each Stock Purchase Unit consists of (a) a Stock Purchase Contract under which the holder upon settlement will purchase from or sell to us an indeterminant number of shares of Common Stock of Cinergy Corp. and (b) either Preferred Trust Securities, Debt Securities or debt obligations of a third party including U.S. Treasury Securities, other Stock Purchase Contracts or Common Stock.

(5)

No separate consideration will be received for the Preferred Securities Guarantee. Debt Securities may be purchased by CC Funding Trust II with the proceeds of the sale of Preferred Trust Securities, in which case no separate consideration will be received for the Debt Securities. Such Debt Securities may be later distributed to the holders of the Preferred Trust Securities upon dissolution of the Trust and distribution of its assets.

Subject to Completion, Dated January 15, 2003

The information in this prospectus is not complete and may be changed. We may 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 state where the offer or sale is not permitted.

PROSPECTUS

Cinergy Corp.
CC Funding Trust II

By this prospectus, we offer up to

$750,000,000

of

Cinergy Corp.
Common Stock, Preferred Stock,
Stock Purchase Contracts, Stock Purchase Units and
Debt Securities

and

CC Funding Trust II
Preferred Trust Securities
Guaranteed as described in this prospectus
by Cinergy Corp.

        We will provide the specific terms of these securities in supplements to this prospectus. You should read this prospectus and the supplements carefully before you invest.

The Securities and Exchange Commission and state securities regulators have not approved or disapproved these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus is                            , 2003.

TABLE OF CONTENTS

	PAGE
ABOUT THIS PROSPECTUS	1
WHERE YOU CAN FIND MORE INFORMATION	2
THE COMPANY	3
THE TRUST	4
USE OF PROCEEDS	4
RATIO OF EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS	4
DIVIDENDS AND PRICE RANGE OF COMMON STOCK	5
CONSOLIDATED CAPITALIZATION	5
SELECTED CONSOLIDATED INCOME INFORMATION	6
ACCOUNTING TREATMENT RELATING TO PREFERRED TRUST SECURITIES	6
DESCRIPTION OF THE DEBT SECURITIES	6
DESCRIPTION OF THE PREFERRED TRUST SECURITIES	14
DESCRIPTION OF THE PREFERRED SECURITIES GUARANTEE	25
RELATIONSHIP AMONG THE PREFERRED TRUST SECURITIES, THE DEBT SECURITIES AND THE PREFERRED SECURITIES GUARANTEE	28
DESCRIPTION OF STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS	30
DESCRIPTION OF CAPITAL STOCK	30
PLAN OF DISTRIBUTION	31
LEGAL MATTERS	33
INDEPENDENT PUBLIC ACCOUNTANTS	34

This prospectus is part of a registration statement we filed with the Securities and Exchange Commission. You should rely only on the information we have provided or incorporated by reference in this prospectus or any prospectus supplement. We have not authorized anyone to provide you with additional or different information. We are not making an offer of these securities in any jurisdiction where the offer is not permitted. You should assume that the information in this prospectus or any prospectus supplement is accurate only as of the date on the front of the document and that any information we have incorporated by reference is accurate only as of the date of the document incorporated by reference.

ABOUT THIS PROSPECTUS

        This prospectus is part of a registration statement that we and CC Funding Trust II filed with the Securities and Exchange Commission using a "shelf" registration process. Under this shelf process, we and the trust may, from time to time, sell the securities described in this prospectus or combinations thereof in one or more offerings with a maximum aggregate offering price of up to $750,000,000. This prospectus provides a general description of the securities we may offer. Each time we sell securities, we will provide a prospectus supplement that will contain specific information about the terms of that offering. The prospectus supplement may also add, update or change information contained in this prospectus. You should read both this prospectus and any prospectus supplement together with additional information described under "Where You Can Find More Information."

        In this prospectus, unless the context indicates otherwise, the words "Cinergy," "the company," "we," "our," "ours" and "us" refer to Cinergy Corp. and its consolidated subsidiaries. "Trust" refers to CC Funding Trust II.

        We may use this prospectus to offer from time to time:

•

shares of our common stock, par value $0.01 per share;



•

contracts to purchase shares of our common stock;



•

shares of our preferred stock, without prior value, which may be convertible into our common stock;



•

stock purchase units, consisting of (1) a stock purchase contract and (2) our debt securities, the trust's preferred securities or debt obligations of third parties, including United States Treasury securities, other stock purchase contracts or common stock that are pledged to secure the stock purchase unit holders' obligations to purchase or to sell, as the case may be, our common stock under the stock purchase contracts;



•

our unsecured and unsubordinated debt securities, which in this prospectus we refer to as the senior debt securities, which may be convertible into our common stock; and



•

our unsecured subordinated debt securities, which in this prospectus we refer to as the junior subordinated debt securities, which may be convertible into our common stock. In this prospectus, we refer to the senior debt securities together with the junior subordinated debt securities as the debt securities.

        The trust may also use this prospectus to offer from time to time the trust's preferred securities, which we refer to in this prospectus as the preferred trust securities. We will guarantee the trust's obligations under the preferred trust securities as described below under "Description of the Preferred Securities Guarantee."

        We sometimes refer to our common stock, preferred stock, stock purchase contracts, stock purchase units, the debt securities, the preferred trust securities and the preferred securities guarantee collectively as the securities.

        For more detailed information about the securities, you can also read the exhibits to the registration statement. Those exhibits have been either filed with the registration statement or incorporated by reference to earlier SEC filings listed in the registration statement.

WHERE YOU CAN FIND MORE INFORMATION

        We file annual, quarterly and special reports, proxy statements and other information with the Commission. You may read and copy any document that we file at the Public Reference Room of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. Information on the operation of the Public Reference Room may be obtained by calling the Commission at 1-800-SEC-0330. You may also read our filings over the Internet at the Commission's home page at http:/ /www.sec.gov. Our common stock is listed on the New York Stock Exchange under the ticker symbol "CIN". You can obtain information about us at the offices of the New York Stock Exchange, 20 Broad Street, New York, New York 10005.

        This prospectus is part of a registration statement on Form S-3 filed with the Commission under the Securities Act of 1933. It does not contain all of the information that is important to you. You should read the registration statement for further information with respect to Cinergy and the securities. Statements contained in this prospectus concerning the provisions of any document filed as an exhibit to the registration statement or otherwise filed with the Commission highlights selected information, and in each instance reference is made to the copy of the document filed.

        The Commission 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 Commission will automatically update and supersede this information. We incorporate by reference the documents listed below and any future filings made with the Commission under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until we sell all of the securities:

(a)

Annual Report on Form 10-K for the year ended December 31, 2001;



(b)

Quarterly Reports on Form 10-Q for the quarters ended March 31, 2002, June 30, 2002 and September 30, 2002;



(c)

Current Report on Form 8-K dated February 19, 2002 and Current Report on Form 8-K dated April 30, 2002 (as amended on May 17, 2002); and



(d)

Registration Statement on Form 8-B dated September 1, 1994.

        You may request a copy of any of the information incorporated by reference at no cost, by writing or telephoning the office of Wendy L. Aumiller, Treasurer, Cinergy Corp., 139 East Fourth Street, Cincinnati, Ohio 45202, telephone number (513) 421-9500.

2

THE COMPANY

        Cinergy Corp., a Delaware corporation created in October 1994, owns all outstanding common stock of The Cincinnati Gas & Electric Company (CG&E) and PSI Energy, Inc. (PSI), both of which are public utility subsidiaries. As a result of this ownership, we are considered a utility holding company. Because we are a holding company whose utility subsidiaries operate in multiple states, we are registered with and are subject to regulation by the SEC under the Public Utility Holding Company Act of 1935, as amended (PUHCA).    Our other principal subsidiaries are:

•

Cinergy Investments, Inc. (Investments);



•

Cinergy Global Resources, Inc. (Global Resources);



•

Cinergy Technologies, Inc. (Technologies);



•

Cinergy Services, Inc. (Services); and



•

Cinergy Wholesale Energy, Inc. (CWE).

        CG&E, an Ohio corporation, is a combination electric and gas public utility company that provides service in the southwestern portion of Ohio and, through its subsidiaries, in nearby areas of Kentucky and Indiana. CG&E's principal utility subsidiary, The Union Light, Heat and Power Company (ULH&P), is a Kentucky corporation that provides electric and gas service in northern Kentucky. CG&E's other subsidiaries are insignificant to its results of operations.

        PSI, an Indiana corporation, is an electric utility that provides service in north central, central, and southern Indiana. The following table presents further information related to the operations of our domestic utility companies (our operating companies):

	Principal Line(s) of Business		Major Cities Served	Approximate Population Served
CG&E and subsidiaries	•	Generation, transmission, distribution, and sale of electricity	Cincinnati, OH Middletown, OH Covington, KY	2,012,000
	•	Sale and/or transportation of natural gas	Florence, KY Newport, KY Lawrenceburg, IN
PSI	•	Generation, transmission, distribution, and sale of electricity	Bloomington, IN Carmel, IN Columbus, IN Kokomo, IN Lafayette, IN New Albany, IN Terre Haute, IN	2,220,000

        Investments holds most of our domestic non-regulated, energy-related businesses and investments. Global Resources holds our international businesses and investments and directs our renewable energy investing activities (for example, wind farms). Technologies primarily holds our portfolio of technology-related investments. Services is a service company that provides our regulated and non-regulated subsidiaries with a variety of centralized administrative, management, and support services. CWE was formed to act as a holding company for Cinergy's energy commodity businesses, including production, as the generation assets eventually become unbundled from the utility subsidiaries. However, Cinergy does not plan to transfer the generating assets of its utility subsidiaries to CWE in the foreseeable future.

3

        Our principal executive offices are located at 139 East Fourth Street, Cincinnati, Ohio 45202; our telephone number is (513) 421-9500.

THE TRUST

        The trust is a statutory trust created under the Delaware Statutory Trust Act pursuant to an amended and restated declaration of trust, among Cinergy Corp., The Bank of New York, as the property trustee, The Bank of New York (Delaware), as Delaware trustee and three employees of Cinergy Corp. as administrative trustees. In this prospectus, we refer to this declaration as the trust agreement. The trust exists only to issue and sell its preferred trust securities and common trust securities, to acquire and hold the debt securities as trust assets and to engage in activities incidental to the foregoing. All of the common trust securities will be owned by Cinergy Corp. The common trust securities will represent at least 3% of the total capital of the trust. Payments will be made on the common trust securities pro rata with the preferred trust securities, except that the common trust securities' right to payment will be subordinated to the rights of the preferred trust securities if there is a default under the trust agreement resulting from an event of default under the indenture.

        The trust's business and affairs will be conducted by its administrative trustees, as set forth in the trust agreement. The office of the Delaware trustee in the State of Delaware is 700 White Clay Center, Route 273, Newark, Delaware 19711. The trust's offices are located at 139 East Fourth Street, Cincinnati, Ohio 45202; our telephone number is (513) 421-9500.

USE OF PROCEEDS

        Unless otherwise set forth in a prospectus supplement, the net proceeds from the sale of the securities will be used for general corporate purposes including repayment of debt and construction costs. The trust will use all of the proceeds received from the sale of the preferred trust securities and common trust securities to purchase our debt securities.

RATIO OF EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS

        Set forth below is the ratio of earnings to fixed charges and ratio of earnings to fixed charges and preferred stock dividends for the nine months ended September 30, 2002 and for each year in the five year period ended December 31, 2001.

		Year Ended December 31,
	Nine Months Ended September 30, 2002
		2001	2000	1999	1998	1997
Ratio of Earnings to Fixed Charges	2.73	3.36	3.66	3.44	2.47	3.33
Ratio of Earnings to Fixed Charges and Preferred Stock Dividends	2.68	3.30	3.56	3.33	2.38	3.09

        For the purpose of computing the ratio of earnings to fixed charges, earnings consist of pretax income from continuing operations plus fixed charges. Fixed charges consist of:

•

interest expense;



•

preferred dividends of a subsidiary trust, which are deductible for tax purposes;



•

amortized premiums, discounts and capitalized expenses related to indebtedness; and



•

an estimate of the interest within rental expense.

4

DIVIDENDS AND PRICE RANGE OF COMMON STOCK

        Cinergy Corp.'s common stock is listed on the New York Stock Exchange. The high and low stock prices for each quarter for the past three years are indicated below:

		High		Low
2002
	First Quarter	$	35.75	$	31.00
	Second Quarter		37.19		34.25
	Third Quarter		36.21		25.40
	Fourth Quarter		34.19		28.25
2001
	First Quarter	$	35.15	$	28.81
	Second Quarter		35.60		32.20
	Third Quarter		35.00		28.00
	Fourth Quarter		33.85		28.16
2000
	First Quarter	$	25.88	$	20.00
	Second Quarter		28.13		21.19
	Third Quarter		33.25		25.56
	Fourth Quarter		35.25		28.50

        As of October 15, 2002, the most recent dividend record date, we had 56,306 common stockholders of record. Cinergy Corp. declared dividends on common stock of $.45 per share for each quarter of 2000, 2001 and 2002.

CONSOLIDATED CAPITALIZATION

        The table below shows our capitalization on a consolidated basis as of September 30, 2002.

			Outstanding September 30, 2002
			Amount			% of Capitalization
Total Debt			$	5,018,347		58	%
Preferred Trust Securities				307,752		3
Cumulative Preferred Stock of Subsidiaries				62,828		1
Common Stock Equity
	Common Stock—$.01 par value; authorized shares—600,000,000; outstanding shares—168,267,726 at September 30, 2002			1,683
	Paid-in capital			1,889,119
	Retained earnings			1,385,887
	Accumulated other comprehensive income (loss)			(21,724	)
		Total Common Stock Equity		3,254,965		38
Total Capitalization			$	8,643,892		100	%

5

SELECTED CONSOLIDATED INCOME INFORMATION

        The following table shows selected financial information of Cinergy. This information is derived from our historical results. See "Where You Can Find More Information." All amounts are in thousands except per share amounts.

				Year Ended December 31,
		Nine Months Ended September 30, 2002
				2001		2000		1999(1)
Operating Revenues		$	8,569,774	$	12,922,537	$	8,421,964	$	5,937,888
Depreciation			303,996		378,140		343,949		323,268
Operating Income			590,570		941,856		861,628		693,223
Interest			186,414		268,127		224,459		234,778
Income Taxes			121,299		255,506		251,557		208,671
Preferred Dividend Requirement of Subsidiary Trust			17,847		1,067		—		—
Preferred Dividend Requirement of Subsidiaries			2,575		3,433		4,585		5,457
Net Income			271,279		442,279		399,466		403,641
Average Common Shares Outstanding			166,544		159,110		158,938		158,863
Earnings Per Common Share Net Income		$	1.63	$	2.78	$	2.51	$	2.54
Earnings per Common Share—
	Assuming Dilution Net Income	$	1.61	$	2.75	$	2.50	$	2.53

(1)

In the third quarter of 1999, we realized a net contribution to earnings of approximately $0.43 per share (basic and diluted) when we sold our 50% ownership interest in Midlands Electricity plc.

        In the third quarter of 1999, extreme weather conditions resulted in a reduction in net income of $57.0 million ($16 million for CG&E, $41 million for PSI) after tax or $0.36 per share (basic and diluted).

ACCOUNTING TREATMENT RELATING TO PREFERRED TRUST SECURITIES

        The financial statements of the trust will be consolidated with our financial statements, with the preferred trust securities shown on our consolidated financial statements as company obligated, mandatorily redeemable, preferred trust securities of a subsidiary, holding solely debt securities of the company. Our financial statements will include a footnote that discloses, among other things, that the assets of the trust consist of our debt securities and will specify the designation, principal amount, interest rate and maturity date of the debt securities.

DESCRIPTION OF THE DEBT SECURITIES

        We may issue directly to the public, to the trust or as part of a stock purchase unit from time to time one or more series of the senior debt securities or the junior subordinated debt securities under an indenture dated September 12, 2001 between us and Fifth Third Bank, as indenture trustee. We will provide information about these debt securities in a prospectus supplement. We will issue only one series of debt securities to the trust.

        We have summarized certain terms and provisions of the indenture. The summary is not complete. The indenture is filed as an exhibit to the registration statement of which this prospectus forms a part. You should read the indenture for the provisions which may be important to you. Terms used in this summary have the meanings specified in the indenture. The indenture is subject to and governed by the Trust Indenture Act of 1939, as amended.

6

General

        The indenture allows us to issue debt securities in an unlimited amount from time to time.

        The debt securities will be unsecured obligations of Cinergy Corp. In this section, unless the context requires, the words "Cinergy," the "company," "we," "our," "ours," and "us" refer to Cinergy Corp. and not its consolidated subsidiaries.

        The relevant prospectus supplement will describe the terms of any debt securities being offered, including:

•

the title of the debt securities;



•

any limit on the aggregate principal amount of the debt securities;



•

the date or dates on which the principal of any of the debt securities will be payable;



•

the rate or rates at which any of the debt securities will bear interest, if any;



•

the date from which interest, if any, on the debt securities will accrue, the dates on which interest, if any, will be payable, the date on which payment of interest, if any, will commence, and the record dates for any interest payments;



•

the right, if any, to extend interest payment periods and the duration of any extension;



•

any redemption, repayment or sinking fund provisions;



•

the place or places where the principal of and any premium and interest on any of the debt securities will be payable;



•

the denominations in which such debt securities will be issuable;



•

the index, if any, with reference to which the amount of principal of or any premium or interest on the debt securities will be determined;



•

any addition to or change in the events of default applicable to any of the debt securities and any change in the right of the trustee or the holders to declare the principal amount of any of the debt securities due and payable;



•

any addition to or change in the covenants in the indenture;



•

whether such debt securities are convertible into other securities and the terms thereof;



•

the applicability of or any change in the subordination provisions of the indenture for a series of debt securities; and



•

any other terms of the debt securities not inconsistent with the provisions of the indenture.

Structural Subordination

        Cinergy Corp. is a holding company. As a consequence, the debt securities will be structurally subordinate to all secured and unsecured debt of Cinergy's operating subsidiaries.

Subsequent Distribution of Trust Securities

        If we issue debt securities to the trust in connection with the issuance of preferred trust securities and common trust securities by the trust, those debt securities subsequently may be distributed to the holders of the preferred trust securities and common trust securities either:

•

upon the dissolution of the trust, or



•

upon the occurrence of events that we will describe in the prospectus supplement.

7

Subordination of Certain Debt Securities

        The indenture provides that one or more series of debt securities may be subordinate and subject in right of payment to the prior payment in full of all senior debt of the company.

        No payment of principal of (including redemption and sinking fund payments), premium, if any, or interest on, the junior subordinated debt securities may be made if any senior debt is not paid when due, any default has not been cured or waived, or if the maturity of any senior debt has been accelerated because of a default. Upon any distribution of assets of the company to creditors upon any dissolution, winding-up, liquidation or reorganization, whether voluntary or involuntary or in bankruptcy, insolvency, receivership or other proceedings, all principal of, and premium, if any, and interest due or to become due on, all senior debt must be paid in full before the holders of the junior subordinated debt securities are entitled to receive or retain any payment. The rights of the holders of the junior subordinated debt securities will be subrogated to the rights of the holders of senior debt to receive payments or distributions applicable to senior debt.

        In this prospectus, we use the term senior debt to mean the principal of, premium, if any, interest on and any other payment due pursuant to any of the following, whether outstanding at the date of execution of the indenture or thereafter incurred, created or assumed:

(1)

all indebtedness of the company evidenced by notes, debentures, bonds, or other securities sold by the company for money, excluding junior subordinated debt securities, but including all first mortgage bonds of the company outstanding from time to time;

(2)

all indebtedness of others of the kinds described in the preceding clause (1) assumed by or guaranteed in any manner by the company; and

(3)

all renewals, extensions, or refundings of indebtedness of the kinds described in any of the preceding clauses (1) and (2);

unless, in the case of any particular indebtedness, renewal, extension or refunding, the instrument creating or evidencing the same or the assumption or guarantee of the same expressly provides that such indebtedness, renewal, extension or refunding is not superior in right of payment to or is pari passu with the junior subordinated debt securities.

        The indenture does not limit the aggregate amount of senior debt that the company may issue.

Exchange, Register and Transfer

        The debt securities of each series will be issuable only in fully registered form without coupons.

        The debt securities may be presented for exchange, registered and transferred in the manner, at the places and subject to the restrictions set forth in the debt securities and the relevant prospectus supplement. Subject to the limitations noted in the indenture, you will not have to pay for such services, except for any taxes or other governmental charges associated with such services.

Global Securities

        We may issue registered debt securities of a series in the form of one or more fully registered global debt securities, each of which we refer to in this prospectus as a registered global security, that we will deposit with a depositary (or with a nominee of a depositary) identified in the prospectus supplement relating to such series and registered in the name of the depositary (or a nominee). In such a case, we will issue one or more registered global securities. The face of such registered global securities, will set forth the aggregate principal amount of the series of debt securities that such global registered securities represent. The depositary (or its nominee) will not transfer any registered global

8

security unless and until it is exchanged in whole or in part for debt securities in definitive registered form, except that:

•

the depositary may transfer the whole registered global security to a nominee;



•

the depositary's nominee may transfer the whole registered global security to the depositary;



•

the depositary's nominee may transfer the whole registered global security to another of the depositary's nominees; and



•

the depositary (or its nominee) may transfer the whole registered global security to its (or its nominee's) successor.

Depositary Arrangements

        We will describe the specific terms of the depositary arrangement with respect to any portion of a series of debt securities to be represented by a registered global security in the prospectus supplement relating to such series. We anticipate that the following provisions will apply to all depositary arrangements.

        Generally, ownership of beneficial interests in a registered global security will be limited to persons that have accounts with the depositary for such registered global security, which persons are referred to in this prospectus as participants, or persons that may hold interests through participants. Upon the issuance of a registered global security, the depositary will credit, on its book-entry registration and transfer system, the participants' accounts with the respective principal amounts of the debt securities represented by such registered global security that are beneficially owned by such participants.

        Any dealers, underwriters or agents participating in the distribution of such debt securities will designate the accounts to credit. For participants, the depositary will maintain the only record of their ownership of a beneficial interest in the registered global security and they will only be able to transfer such interests through the depositary's records. For people who hold through a participant, the relevant participant will maintain such records for beneficial ownership and transfer. The laws of some states may require that certain purchasers of securities take physical delivery of such securities in definitive form. Such limits and such laws may impair the ability to own, transfer or pledge beneficial interests in registered global securities.

        So long as the depositary (or its nominee) is the record owner of a registered global security, such depositary (or its nominee) will be considered the sole owner or holder of the debt securities represented by such registered global security for all purposes under the indenture. Except as set forth below, owners of beneficial interests in a registered global security will not be entitled to have the debt securities represented by such registered global security registered in their names, and will not receive or be entitled to receive physical delivery of such debt securities in definitive form and will not be considered the owners or holders under the indenture. Accordingly, each person owning a beneficial interest in a registered global security must rely on the procedures of the depositary and, if such person is not a participant, on the procedures of the participant through which such person owns its interest, to exercise any rights of a holder under the indenture. We understand that under existing industry practices, if we request any action of holders or if any owner of a beneficial interest in a registered global security desires to give or take any action allowed under the indenture, the depositary would authorize the participants holding the relevant beneficial interests to give or take such action, and such participants would authorize beneficial owners owning through such participants to give or take such action or would otherwise act upon the instruction of beneficial owners holding through them.

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Interest and Premium

        Payments of principal, premium, if any, and any interest on debt securities represented by a registered global security registered in the name of a depositary (or its nominee) will be made to the depositary (or its nominee) as the registered owner of such registered global security. We and our agents will have no responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in any registered global security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests, and neither will the trustee and its agents.

        We expect that the depositary for any debt securities represented by a registered global security, upon receipt of any payment of principal, premium, if any, or any interest in respect of such registered global security, will immediately credit participants' accounts with payments in amounts proportionate to their respective beneficial interests in such registered global security as shown on the depositary's records. We also expect that payments by participants to owners of beneficial interests in such registered global security held through such participants will be governed by standing customer instructions and customary practices, as is now the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such participants.

Withdrawal of Depositary

        If the depositary for any debt securities represented by a registered global security notifies us that it is unwilling or unable to continue as depositary or ceases to be eligible under applicable law, and a successor depositary is not appointed within 90 days, debt securities in definitive form will be issued in exchange for the relevant registered global security. In addition, we may at any time and in our sole discretion determine not to have any of the debt securities of a series represented by one or more registered global securities and, in such event, debt securities of such series in definitive form will be issued in exchange for all of the registered global security or registered global securities representing such debt securities. Any debt securities issued in definitive form in exchange for a registered global security will be registered in such name or names that the depositary gives to the trustee. We expect that such instructions will be based upon directions received by the depositary from participants with respect to ownership of beneficial interests in such registered global security.

Payment and Paying Agents

        Unless the applicable prospectus supplement indicates otherwise, payment of interest on a debt security on any interest payment date will be made to the person in whose name such debt security is registered at the close of business on the regular record date for such interest payment.

        Unless the applicable prospectus supplement indicates otherwise, principal of and any premium and interest on the debt securities will be payable at the office of the paying agent designated by us. However, we may elect to pay interest by check mailed to the address of the person entitled to such payment at the address appearing in the security register. Unless otherwise indicated in the applicable prospectus supplement, the corporate trust office of the trustee in the City of Cincinnati will be designated as our sole paying agent for payments with respect to debt securities of each series. Any other paying agents initially designated by us for the debt securities of a particular series will be named in the applicable prospectus supplement. We may at any time designate additional paying agents or rescind the designation of any paying agent or approve a change in the office through which any paying agent acts, except that we will be required to maintain a paying agent in each place of payment for the debt securities of a particular series.

        All moneys paid by us to a paying agent for the payment of the principal of or any premium or interest on any debt security which remain unclaimed at the end of 18 months after such principal,

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premium or interest has become due and payable will be repaid to us, and the holder of such debt security thereafter may look only to us for payment.

Consolidation, Merger, and Sale of Assets

        The indenture does not contain any provision that restricts our ability to merge or consolidate with or into any other corporation, sell or convey all or substantially all of our assets to any person, firm or corporation or otherwise engage in restructuring transactions, provided that the successor corporation assumes due and punctual payment of principal or premium, if any, and interest on the debt securities.

Events of Default

        Each of the following is defined as an event of default under the indenture with respect to debt securities of any series:

•

failure to pay principal of or any premium on any debt security of that series when due;



•

failure to pay any interest on any debt security of that series when due, continued for 30 days;



•

failure to deposit any sinking fund payment, when due, in respect of any debt security of that series;



•

failure to perform any other of our covenants in the indenture (other than a covenant included in the indenture solely for the benefit of a series other than that series), continued for 90 days after written notice has been given by the trustee, or the holders of at least 35% in principal amount of the outstanding debt securities of that series, as provided in the indenture; and



•

certain events of bankruptcy, insolvency or reorganization.

        If an event of default (other than a bankruptcy, insolvency or reorganization event of default) with respect to the debt securities of any series at the time outstanding shall occur and be continuing, either the trustee or the holders of at least 35% in aggregate principal amount of the outstanding debt securities of that series by notice as provided in the indenture may declare the principal amount of the debt securities of that series to be due and payable immediately. If a bankruptcy, insolvency or reorganization event of default with respect to the debt securities of any series at the time outstanding shall occur, the principal amount of all the debt securities of that series will automatically, and without any action by the trustee or any holder, become immediately due and payable. After any such acceleration, but before a judgment or decree based on acceleration, the holders of a majority in aggregate principal amount of the outstanding debt securities of that series may, under certain circumstances, rescind and annul such acceleration if all events of default, other than the non-payment of accelerated principal, have been cured or waived as provided in the indenture. For information as to waiver of defaults, see "Modification and Waiver."

        Subject to the provisions of the indenture relating to the duties of the trustee in case an event of default shall occur and be continuing, the trustee will be under no obligation to exercise any of its rights or powers under the indenture at the request or direction of any of the holders, unless such holders shall have offered to the trustee reasonably satisfactory indemnity. Subject to such provisions for the indemnification of the trustee, the holders of a majority in principal amount of the outstanding debt securities of any series will 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 debt securities of that series.

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        No holder of a debt security of any series will have any right to institute any proceeding with respect to the indenture, or for the appointment of a receiver or a trustee, or for any other remedy thereunder, unless:

•

such holder has previously given to the trustee written notice of a continuing event of default with respect to the debt securities of that series;



•

the holders of at least 35% in aggregate principal amount of the outstanding debt securities of that series have made written request, and such holder or holders have offered reasonably satisfactory indemnity, to the trustee to institute such proceeding as trustee; and



•

the trustee has failed to institute such proceeding, and has not received from the holders of a majority in aggregate principal amount of the outstanding debt securities of that series a direction inconsistent with such request, within 60 days after such notice, request and offer. However, such limitations do not apply to a suit instituted by a holder of a debt security for the enforcement of payment of the principal of or any premium or interest on such debt security on or after the applicable due date specified in such debt security.

        We will be required to furnish to the trustee annually a statement by certain of our officers as to whether or not we, to our knowledge, are in default in the performance or observance of any of the terms, provisions and conditions of the indenture and, if so, specifying all such known defaults.

Modification and Waiver

        Modifications and amendments of the indenture may be made by us and the trustee with the consent of the holders of not less than a majority in aggregate principal amount of the outstanding debt securities of each series affected by such modification or amendment; provided, however, that no such modification or amendment may, without the consent of the holder of each outstanding debt security affected thereby:

•

change the stated maturity of the principal of, or any installment of principal of or interest on, any debt security;



•

reduce the principal amount of, or any premium or interest on, any debt security;



•

reduce the amount of principal of an original issue discount security or any other debt security payable upon acceleration of the maturity thereof;



•

change the place or currency of payment of principal of, or any premium or interest on, any debt security;



•

affect the applicability of the subordination provisions to any debt security;



•

impair the right to institute suit for the enforcement of any payment on or with respect to any debt security; or



•

reduce the percentage in principal amount of outstanding debt securities of any series, the consent of whose holders is required for modification or amendment of the indenture, reduce the percentage in principal amount of outstanding debt securities of any series necessary for waiver of compliance with certain provisions of the indenture or for waiver of certain defaults or modify such provisions with respect to modification and waiver.

        The holders of not less than a majority in aggregate principal amount of the outstanding debt securities of any series may waive our compliance with certain restrictive provisions of the indenture. The holders of a majority in principal amount of the outstanding debt securities of any series may waive any past default under the indenture, except a default in the payment of principal, premium, or

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interest and certain covenants and provisions of the indenture which cannot be amended without the consent of the holder of each outstanding debt security of such series affected.

        Except in certain limited circumstances, we will be entitled to set any day as a record date for the purpose of determining the holders of outstanding debt securities of any series entitled to give or take any direction, notice, consent, waiver, or other action under the indenture, in the manner and subject to the limitations provided in the indenture. In certain limited circumstances, the trustee will be entitled to set a record date for action by holders. If a record date is set for any action to be taken by holders of a particular series, such action may be taken only by persons who are holders of outstanding debt securities of that series on the record date. To be effective, such action must be taken by holders of the requisite principal amount of such debt securities within a specified period following the record date. For any particular record date, this period will be 180 days or such other shorter period as we may specify (or the trustee, if it set the record date), and may be shortened or lengthened (but not beyond 180 days) from time to time.

Defeasance and Covenant Defeasance

        Under the indenture, we may elect to have the provisions of the indenture relating to defeasance and discharge of indebtedness or the provisions relating to defeasance of certain restrictive covenants applied with respect to the debt securities of any series.

Defeasance and Discharge.

        If we elect to have the provisions of the indenture relating to defeasance and discharge of indebtedness applied to any debt securities, we will be discharged from all our obligations with respect to such debt securities (except for certain obligations to exchange or register the transfer of debt securities, to replace stolen, lost or mutilated debt securities, to maintain paying agencies and to hold moneys for payment in trust) upon the deposit in trust for the benefit of the holders of such debt securities of money or U.S. Government Obligations, or both, which, through the payment of principal and interest in respect thereof in accordance with their terms, will provide money in an amount sufficient to pay the principal of and any premium and interest on such debt securities on the respective stated maturities in accordance with the terms of the indenture and such debt securities. Such defeasance or discharge may occur only if, among other things, we have delivered to the trustee an opinion of counsel to the effect that we have received from, or there has been published by, the United States Internal Revenue Service a ruling, or there has been a change in tax law, in either case to the effect that holders of such debt securities will not recognize gain or loss for federal income tax purposes as a result of such deposit, defeasance, and discharge and will be subject to federal income tax on the same amount, in the same manner and at the same times as would have been the case if such deposit, defeasance and discharge were not to occur.

Defeasance of Certain Covenants.

        If we elect to have the provisions of the indenture relating to defeasance of certain covenants applied to any debt securities, we may omit to comply with certain restrictive covenants that may be described in the applicable prospectus supplement, and the occurrence of certain events of default, which are described above (with respect to such restrictive covenants) under "events of default" and any that may be described in the applicable prospectus supplement, will be deemed not to be or result in an event of default, in each case with respect to such debt securities. In order to exercise such option, we will be required to deposit, in trust for the benefit of the holders of such debt securities, money or U.S. Government Obligations, or both, which, through the payment of principal and interest in respect thereof in accordance with their terms, will provide money in an amount sufficient to pay the principal of and any premium and interest on such debt securities on the respective stated maturities in

13

accordance with the terms of the indenture and such debt securities. We will also be required, among other things, to deliver to the trustee an opinion of counsel to the effect that holders of such debt securities will not recognize gain or loss for federal income tax purposes as a result of such deposit and defeasance of certain obligations and will be subject to federal income tax on the same amount, in the same manner and at the same times as would have been the case if such deposit and defeasance were not to occur. In the event that we were to exercise this option with respect to any debt securities and such debt securities subsequently were declared due and payable because of the occurrence of any event of default, the amount of money and U.S. Government Obligations deposited in trust would be sufficient to pay amounts due on the debt securities at the time of their respective stated maturities but might not be sufficient to pay the amounts due upon acceleration resulting from the event of default. In such case, we would remain liable for such payments.

Title

        Cinergy and the trustee, and any agent of Cinergy or the trustee may treat the person in whose name a debt security is registered as the absolute owner thereof (whether or not such debt security may be overdue) for the purpose of making payment and for all other purposes.

Governing Law

        The indenture and the debt securities will be governed by, and construed in accordance with, the laws of the State of New York.

Concerning the Trustee

        Fifth Third Bank will be the trustee under the indenture. Fifth Third Bank acts as trustee for our other unsecured debt securities and the unsecured debt securities of our subsidiaries, including CG&E, PSI, ULH&P and Global Resources. Fifth Third Bank also acts as the trustee for certain pollution control revenue bonds of PSI and CG&E, and acts as registrar for our common stock and for the preferred stock of PSI and CG&E. Fifth Third Bank makes loans to, acts as depositary for, and, in the normal course of business, also performs other services for PSI, CG&E and ULH&P.

DESCRIPTION OF THE PREFERRED TRUST SECURITIES

        The trust may issue preferred trust securities and common trust securities under the trust agreement, which we refer to in this prospectus as the trust securities. These trust securities will represent undivided beneficial interests in the assets of the trust. Selected provisions of the trust agreement are summarized below. This summary is not complete. The form of trust agreement was filed with the SEC and you should read the trust agreement for provisions that may be important to you. The trust agreement will be qualified as an indenture under the Trust Indenture Act. You should also refer to the Trust Indenture Act for provisions that apply to the preferred trust securities. Wherever particular defined terms of the trust agreement are referred to, such defined terms are incorporated into this prospectus by reference.

General

        The trust agreement authorizes the trust to issue the preferred trust securities and the common trust securities. The preferred trust securities and the common trust securities represent undivided beneficial interests in the assets of the trust. We will own all of the issued and outstanding common trust securities of the trust, with an aggregate stated liquidation amount equal to at least 3% of the total capital of the trust. We may transfer the common trust securities only to an affiliate that is a U.S. person for U.S. federal income tax purposes. When the trust issues its preferred trust securities, you and the other holders of the preferred trust securities will own all of the issued and outstanding

14

preferred trust securities of the trust. The preferred trust securities will be substantially identical to the common trust securities and will rank equally with the common trust securities, except that:

•

if a trust enforcement event under the trust agreement occurs and is continuing, the holders of preferred trust securities will have the right to receive payments before the holders of the common trust securities receive payments; and



•

the holders of common trust securities have the exclusive right to appoint, remove or replace the trustees and to increase or decrease the number of trustees.

        The trust will exist primarily for the purposes of:

•

issuing its preferred trust securities and common trust securities;



•

investing the proceeds from the sale of its trust securities in our debt securities; and



•

engaging in only such other activities as are necessary or incidental to issuing its trust securities and purchasing and holding our debt securities.

        The rights of the holders of the preferred trust securities, including economic rights, rights to information and voting rights, will be contained in and governed by the trust agreement, the Delaware Statutory Trust Act and the Trust Indenture Act of 1939, as amended.

        We will fully and unconditionally guarantee payments due on the preferred trust securities through a combination of the following:

•

the rights of holders of preferred trust securities to enforce those obligations;



•

our agreement to pay the expenses of the trust; and



•

our guarantee of payments due on the preferred trust securities to the extent of the trust's assets (which guarantee we refer to in this prospectus as the preferred securities guarantee).

        The property trustee will hold legal title to the debt securities in trust for the benefit of holders of the preferred trust securities and common trust securities.

        A prospectus supplement relating to the preferred trust securities will include specific terms of those securities and of the debt securities. For a description of some specific terms that will affect both the preferred trust securities and the debt securities and your rights under each, see "Description of the Debt Securities" above.

Distributions

        The only income of the trust available for distribution to the holders of preferred trust securities will be payments on the debt securities. If we fail to make interest payments on the debt securities, the trust will not have funds available to pay distributions on preferred trust securities. The payment of distributions, if and to the extent the trust has sufficient funds available for the payment of such distributions, is guaranteed on a limited basis by us as described under "Description of the Preferred Securities Guarantee."

        If stated in the applicable prospectus supplement, so long as no "event of default" under the indenture has occurred and is continuing, we may extend the interest payment period from time to time on the debt securities for one or more periods. As a consequence, distributions on preferred trust securities would be deferred during any such period. Interest would, however, continue to accrue. During any extended interest period, or for so long as an "event of default" under the indenture or any payment default under the preferred securities guarantee has occurred and is continuing, we may not:

•

declare or pay any dividend or distribution on our capital stock;

15

•

redeem, purchase, acquire or make a liquidation payment with respect to any of our capital stock; or



•

pay any principal, interest or premium on, or repay, repurchase or redeem any debt securities that are equal or junior in right of payment with the debt securities; or make any guarantee payments with respect to any guarantee by us of the debt of any our subsidiaries if such guarantee ranks equally with a junior interest to the debt securities.

        However, even during such circumstances, we may:

•

purchase or acquire our capital stock in connection with the satisfaction by us of our obligations under any employee benefit plans or pursuant to any contract or security outstanding on the first day of any such event requiring us to purchase our capital stock;



•

reclassify our capital stock or exchange or convert one class or series of our capital stock for another class or series of our capital stock;



•

purchase fractional interests in shares of our capital stock pursuant to the conversion or exchange provisions of such capital stock or the security being converted or exchanged;



•

declare dividends or distributions in our capital stock;



•

redeem or repurchase any rights pursuant to a rights agreement; and



•

make payments under the preferred securities guarantee related to the preferred trust securities.

        Before an extension period ends, we may further extend the interest payment period. No extension period as further extended may exceed 20 consecutive quarters. After any extension period and the payment of all amounts then due, we may select a new extended interest payment period. No interest period may be extended beyond the maturity of the debt securities.

Redemption

        Whenever debt securities are repaid, whether at maturity or earlier redemption, the property trustee will apply the proceeds to redeem a like amount of preferred trust securities and common trust securities.

        Preferred trust securities will be redeemed at the redemption price plus accrued and unpaid distributions with the proceeds from the contemporaneous redemption of debt securities. Redemptions of the preferred trust securities will be made on a redemption date only if the trust has funds available for the payment of the redemption price plus accrued and unpaid distributions. Holders of preferred trust securities will be given not less than 30 nor more than 60 days' notice of any redemption. On or before the redemption date, the trust will irrevocably deposit with the paying agent for preferred trust securities sufficient funds and will give the paying agent irrevocable instructions and authority to pay the redemption price plus accrued and unpaid distributions to the holders upon surrender of their preferred trust securities. Distributions payable on or before a redemption date will be payable to the holders on the record date for the distribution payment. If notice is given and funds are deposited as required, then on the redemption date all rights of holders of the preferred trust securities called for redemption will cease, except the right of the holders to receive the redemption price plus accrued and unpaid distributions, and the preferred trust securities will cease to be outstanding. No interest will accrue on amounts payable on the redemption date. In the event that any date fixed for redemption of preferred trust securities is not a business day, then payment will be made on the next business day, except that, if such business day falls in the next calendar year, then payment will be made on the immediately preceding business day. No interest will be payable because of any such delay. If payment of preferred trust securities called for redemption is improperly withheld or refused and not paid either by the trust or by us pursuant to the preferred securities guarantee, distributions on such preferred

16

trust securities will continue to accrue to the date of payment. The actual payment date will be considered the date fixed for redemption for purposes of calculating the redemption price plus accrued and unpaid distributions.

        Subject to applicable law, including United States federal securities law, we or our affiliates may at any time and from time to time purchase outstanding preferred trust securities by tender, in the open market or by private agreement.

        If preferred trust securities are partially redeemed on a redemption date, a corresponding percentage of the common trust securities will be redeemed. The particular preferred trust securities to be redeemed will be selected not more than 60 days prior to the redemption date by the property trustee by such method as the property trustee shall deem fair, taking into account the denominations in which they were issued. The property trustee will promptly notify the preferred trust security registrar in writing of the preferred trust securities selected for redemption and, where applicable, the partial amount to be redeemed.

Subordination of Common Trust Securities; Trust Enforcement Event

        Payment of distributions on, and the redemption price, plus accrued and unpaid distributions, of, the preferred trust securities and common trust securities shall be made pro rata based on the liquidation preference amount of such securities. However, if on any distribution payment date or redemption date an event of default under the indenture has occurred and is continuing, which is also a "trust enforcement event" under the trust agreement, no payment on any common trust security shall be made until all payments due on the preferred trust securities have been made. In that case, funds available to the property trustee shall first be applied to the payment in full of all distributions on, or the redemption price plus accrued and unpaid distributions of, preferred trust securities then due and payable.

        If a trust enforcement event has occurred and is continuing, the holder of common trust securities cannot take action with respect to the trust agreement default until the effect of all defaults with respect to preferred trust securities has been cured, waived or otherwise eliminated. Until the trust enforcement event has been cured, waived or otherwise eliminated, the property trustee shall, to the fullest extent permitted by law, act solely on behalf of the holders of preferred trust securities and not the holders of the common trust securities, and only holders of preferred trust securities will have the right to direct the property trustee to act on their behalf.

        The property trustee will transmit by mail, first class postage prepaid, notice of each trust enforcement event to the holders of the trust securities within 90 days of the occurrence of such trust enforcement event, unless the property trustee in good faith determines that the withholding of such notice is in the holders' interests. We and the administrative trustees are required to file annually with the property trustee a certificate as to whether or not we are in compliance with all the conditions and covenants applicable to us under the trust agreement as well as any reports that may be required to be filed under the Trust Indenture Act. See "Relationship Among the Preferred Trust Securities, the Debt Securities and the Preferred Securities Guarantee—Enforcement Rights of Holders of Preferred Trust Securities" for more information on the enforcement rights of holder of preferred trust securities when a trust enforcement event has occurred.

Liquidation Distribution Upon Dissolution

        Unless otherwise specified in the applicable prospectus supplement, the trust shall dissolve and be liquidated by the property trustee on the first to occur of:

•

the expiration of the term of the trust;



•

our bankruptcy, dissolution or liquidation;

17

•

the redemption of all of the preferred trust securities;



•

the entry of an order for dissolution of the trust by a court of competent jurisdiction;



•

the direction of the property trustee after certain tax events pursuant to which all the debt securities have been distributed in exchange for the trust securities; and



•

our election at any time pursuant to which all the debt securities are to be distributed in exchange for the trust securities.

        If a dissolution of the trust occurs, the trust will be liquidated by the property trustee as expeditiously as the property trustee determines to be appropriate. If a dissolution of the trust occurs other than by redemption of all the preferred trust securities, the property trustee will provide for the satisfaction of liabilities of creditors, if any, and distribute to each holder of the preferred trust securities and common trust securities a proportionate amount of debt securities. If a distribution of debt securities is determined by the property trustee not to be practical, holders will be entitled to receive, out of the assets of the trust after adequate provision for the satisfaction of liabilities of creditors, if any, an amount equal to the aggregate liquidation preference of the preferred trust securities plus accrued and unpaid distributions thereon to the date of payment. If this liquidation distribution can be paid only in part because the trust has insufficient assets available to pay in full the aggregate liquidation distribution, then the amounts payable by the trust on the preferred trust securities shall be paid on a pro rata basis. We, as holder of the common trust securities, will be entitled to receive distributions upon any dissolution pro rata with the holders of the preferred trust securities, except that if an event of default (or event that, with the lapse of time or giving of notice, would become such an event of default) has occurred and is continuing under the indenture, the preferred trust securities will have a preference over the common trust securities.

        After the date fixed for any distribution of debt securities:

•

the preferred trust securities will no longer be deemed to be outstanding, and



•

any certificates representing the preferred trust securities will be deemed to represent debt securities in a principal amount equal to the liquidation amount of the preferred trust securities, bearing accrued and unpaid interest in an amount equal to the accumulated and unpaid distributions on the preferred trust securities, until such certificates are presented to the administrative trustees or their agent for transfer or reissuance.

        There can be no assurance as to the market prices for the debt securities that may be distributed in exchange for preferred trust securities upon dissolution or liquidation of the trust. Accordingly, the debt securities that such investor may receive upon dissolution or liquidation of the trust may trade at a discount to the price that such investor paid to purchase the preferred trust securities offered hereby.

        Any notice of the distribution of debt securities in exchange for preferred trust securities will be mailed to each holder of preferred trust securities being so exchanged at least 30 days but not more than 60 days before the applicable exchange date, at such holder's registered address.

Certain Covenants of Cinergy Corp.

        As long as preferred trust securities are outstanding, we will agree that we will:

•

remain the sole direct or indirect owner of all the outstanding common trust securities, except as permitted by the trust agreement;



•

permit the common trust securities to be transferred only as permitted by the trust agreement; and

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•

use reasonable efforts to cause the trust to continue to be treated as a grantor trust for United States federal income tax purposes, except in connection with a distribution of debt securities to the holders of preferred trust securities as provided in the trust agreement, in which case the trust would be dissolved.

Removal of Trustees

        Unless a trust enforcement event has occurred and is continuing, the holder of the common trust securities may remove any trustee under the trust agreement at any time. If a trust enforcement event has occurred and is continuing, the holders of a majority of the total liquidation preference amount of the outstanding preferred trust securities may remove the property trustee or the Delaware trustee, or both of them. The holder of the common trust securities may remove any administrative trustee at any time. Any resignation or removal of a trustee under the trust agreement will take effect only on the acceptance of appointment by the successor trustee.

        Holders of preferred trust securities will have no right to appoint or remove the administrative trustees of the trust, who may be appointed, removed or replaced solely by us as the holder of the common trust securities.

Mergers, Consolidations or Amalgamations

        The trust may not consolidate with, convert into, amalgamate or merge with or into, be replaced by or convey, transfer or lease its properties and assets substantially as an entirety to any corporation or other body, except as described below. At our request and with the consent of a majority of the administrative trustees, and without the consent of the holders of the preferred trust securities, the Delaware trustee or the property trustee, the trust may consolidate with, convert into, amalgamate or merge with or into, be replaced by or convey, transfer or lease its properties substantially as an entirety to a trust organized under the laws of any state. Such consolidation, conversion, amalgamation, merger, replacement, conveyance, transfer or lease will be subject, however, to the following limitations:

•

if the trust is not the successor entity, then the successor entity either must:



•

expressly assume all of the trust's obligations with respect to the trust securities; or



•

substitute for the trust securities other securities having substantially the same terms as the trust securities, so long as these substitute securities rank the same as the trust securities with respect to distributions and payments upon liquidation, redemption and otherwise;




•

we must expressly appoint a trustee of a successor entity possessing the same powers and duties as the property trustee as the holder of the debt securities;



•

the preferred trust securities or any substitute securities must be listed, or any substitute securities must be listed upon notification of issuance, on any national securities exchange or with any other organization on which the preferred trust securities are then listed or quoted;



•

such consolidation, conversion, amalgamation, merger, replacement, conveyance, transfer or lease must not cause the preferred trust securities (including any substitute securities) to be downgraded by any nationally recognized statistical rating organization;



•

such consolidation, conversion, amalgamation, merger, replacement, conveyance, transfer or lease must not adversely affect the rights, preferences and privileges of the holders of the preferred trust securities (including any substitute securities) in any material respect;



•

such successor entity must have a purpose substantially identical to that of the trust;

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•

prior to such consolidation, conversion, amalgamation, merger, replacement, conveyance, transfer or lease, we must have received an opinion of independent counsel to the trust experienced in such matters to the effect that:



•

such consolidation, conversion, amalgamation, merger, replacement, conveyance, transfer or lease does not adversely affect the rights, preferences and privileges of the holders of the trust securities (including any substitute securities) in any material respect;



•

following such consolidation, conversion, amalgamation, merger, replacement, conveyance, transfer or lease, neither the trust nor such successor entity will be required to register as an investment company under the Investment Company Act; and



•

following such consolidation, conversion, amalgamation, merger, replacement, conveyance, transfer or lease, the trust (or the successor entity) will continue to be classified as a grantor trust for United States federal income tax purposes;




•

we or any permitted successor or assignee must own all of the common trust securities and must guarantee the obligations of such successor entity under the substitute securities, at least to the extent provided by the preferred securities guarantee relating to the preferred trust securities; and



•

such successor entity must expressly assume all of the obligations of the trust.

        Notwithstanding the foregoing, unless holders of 100% in aggregate liquidation amount of the trust securities give their consent, the trust will not consolidate with, convert into, amalgamate or merge with or into, or be replaced by or convey, transfer or lease its properties and assets substantially as an entirety to, any other entity or permit any other entity to consolidate, amalgamate, merge with or into, or replace the trust, if such consolidation, conversion, amalgamation, merger, replacement, conveyance, transfer or lease would cause the trust or the successor entity to be classified as other than a grantor trust for United States federal income tax purposes or would cause each holder of trust securities not to be treated as owning an undivided beneficial ownership interest in the debt securities.

Voting Rights

        Except as provided below and under "Description of the Preferred Securities Guarantee—Amendments and Assignments," and as otherwise required by law or the trust agreement, the holders of preferred trust securities will have no voting rights.

        The holders of not less than a majority in aggregate liquidation amount of the preferred trust securities, voting separately as a class, have the right to:

•

direct the time, method and place to conduct any proceeding for any remedy available to the property trustee, or direct the exercise of any trust or power conferred on the property trustee under the trust agreement;



•

waive any past default and its consequences under the indenture that is waivable;



•

exercise any remedies available to it under the indenture; or



•

consent to any amendment or modification of the indenture or the debt securities, where that consent will be required.

        Where a consent or action under the indenture requires the consent or act of the holders of more than a majority of the aggregate principal amount of debt securities affected, the property trustee only may give such consent or take such action at the direction of the holders of at least the same proportion in aggregate liquidation amount of the preferred trust securities. The property trustee shall not revoke any action previously authorized or approved by a vote of the holders of preferred trust

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securities, except pursuant to the subsequent vote of the holders of preferred trust securities. If the property trustee fails to enforce its rights under the debt securities or the trust agreement, a holder of the preferred trust securities may institute a legal proceeding directly against us, as the case may be, to enforce the property trustee's rights under the debt securities or the trust agreement without first instituting any legal proceeding against the property trustee or anyone else. The property trustee shall notify all holders of preferred trust securities of any notice of default received from the indenture trustee. The property trustee shall have no obligation to take any action not approved by the consent of the holders (except with respect to directing the time, place and method of conducting a proceeding for a remedy) without an opinion of counsel experienced in those matters to the effect that the trust will be classified as a grantor trust for United States federal income tax purposes on account of that action and that each holder of trust securities will be treated as owning an undivided beneficial ownership interest in the debt securities.

        If an event of default under the indenture has occurred and is continuing, then the holders of not less than 25% of the aggregate liquidation amount of the preferred trust securities may direct the property trustee to declare the principal of and interest on the debt securities due and payable.

        A waiver of an event of default under the indenture with respect to the debt securities will constitute a waiver of the corresponding trust enforcement event.

        Holders of preferred trust securities may give any required approval at a meeting convened for such purpose or by written consent without prior notice. The administrative trustees will give notice of any meeting at which holders of preferred trust securities are entitled to vote.

        No vote or consent of the holders of preferred trust securities will be required for the trust to redeem and cancel preferred trust securities or distribute the debt securities in accordance with the trust agreement.

        Notwithstanding that holders of preferred trust securities are entitled to vote or consent under any of the circumstances described above, any preferred trust securities that are owned by us, any trustee or any of their affiliates, shall be treated as if they were not outstanding for purposes of such vote or consent.

Amendments

        Generally, the trust agreement may be amended from time to time by a majority of the administrative trustees and us, without the consent of any holders of preferred trust securities, including:

•

to cure any ambiguity, correct or supplement any defective or inconsistent provisions in the trust agreement; or



•

to add to any of our covenants, restrictions or obligations; or



•

to modify, eliminate or add to any provisions of the trust agreement to the extent necessary to ensure that the trust will be classified for United States federal income tax purposes as a grantor trust at all times that any preferred trust securities and common trust securities are outstanding or to ensure the trust's exemption from the status of an "investment company" under the Investment Company Act of 1940; or



•

to facilitate the tendering, remarketing and settlement of the preferred trust securities, as contemplated in the trust agreement.

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        If any proposed amendment provides for:

•

any action that would adversely affect the powers, preferences or special rights of the trust securities, whether by way of amendment to the trust agreement, other than as described below, or otherwise; or



•

the dissolution, winding-up or termination of the trust other than pursuant to the terms of the trust agreement,

then the amendment will not be effective except with the approval of at least 66²/3% in liquidation amount of outstanding trust securities. If, however, any amendment referred to in the first bullet above would adversely affect only the preferred trust securities or the common trust securities, then only the affected class will be entitled to vote on the amendment and the amendment will not be effective except with the approval of 66²/3% in liquidation amount of the affected class outstanding.

        Each affected holder of preferred trust securities or common trust securities must have consented to any amendment to the trust agreement that:

•

adversely changes the amount or timing of any distribution with respect to preferred trust securities or common trust securities or otherwise adversely affects the amount of any distribution required to be made in respect of preferred trust securities and common trust securities as of a specified date; or



•

restricts the right of a holder of preferred trust securities or common trust securities to institute suit for the enforcement of any such payment on or after that date.

        No amendment may be made to the trust agreement unless the property trustee has received:

•

an officers' certificate from each of us and the trust that such amendment is permitted by, and conforms to, the terms of the trust agreement; and



•

in the case of an amendment that affects the rights, powers, duties, obligations or immunities of the property trustee, an opinion of counsel that such amendment is permitted by, and conforms to, the terms of the trust agreement.

        Moreover, no amendment may be made to the extent the result of such amendment would be to:

•

cause the trust to be classified other than as a grantor trust for purposes of United States federal income tax purposes;



•

reduce or otherwise adversely affect the rights or powers of the property trustee in contravention of the Trust Indenture Act; or



•

cause the trust to be deemed to be an "investment company" required to be registered under the Investment Company Act of 1940.

        The amendment provision of the trust agreement may not be amended without the consent of all of the holders of the trust securities. No amendment that adversely affects the rights, powers and privileges of the property trustee or the Delaware trustee may be made without the consent of the property trustee or the Delaware trustee, respectively. The rights of the holders of the common trust securities under the trust agreement to increase or decrease the number of, and to appoint, or remove trustees may not be amended without the consent of the holders of the common trust securities.

Global Preferred Trust Securities

        Unless otherwise specified in the applicable prospectus supplement, the preferred trust securities will initially be issued in fully registered global form that will be deposited with, or on behalf of, a depositary. Global preferred trust securities may be issued only in fully registered form and in either

22

temporary or permanent form. Unless and until a global preferred trust security is exchanged in whole or in part for the individual preferred trust securities represented thereby, the depositary holding the global preferred trust security may transfer the global preferred trust security only to its nominee or successor depositary or vice versa and only as a whole. Unless otherwise indicated in the applicable prospectus supplement, the depositary for the global preferred trust securities will be The Depository Trust Company, or DTC. The laws of some jurisdictions require that certain purchasers of securities take physical delivery of such securities in certificated form. Such limits and laws may impair the ability to transfer beneficial interests in global preferred trust securities.

        The specific terms of the depositary arrangement for the preferred trust securities will be described in the applicable prospectus supplement. We expect that the applicable depositary, or its nominee, upon receipt of any payment of liquidation amount, premium or distributions in respect of a global preferred trust security representing any of the preferred trust securities, will immediately credit participants' accounts with payments in amounts proportionate to their respective beneficial interests in the aggregate liquidation amount of such global preferred trust securities as shown on the records of the depositary or its nominee. We also expect that payments by participants to beneficial owners will be governed by standing instructions and customary practices, as is now the case with securities held for accounts of customers in bearer form or registered in "street name." Such payments will be the responsibility of the participants.

        Unless otherwise specified in the applicable prospectus supplement, if at any time the depositary is unwilling, unable or ineligible to continue as a depositary for the preferred trust securities, the trust will appoint a successor depositary with respect to the preferred trust securities. If a successor depositary is not appointed by the trust within 90 days after the trust receives such notice or becomes aware of such ineligibility, the trust's election that the preferred trust securities be represented by one or more global preferred trust securities will no longer be effective, and an administrative trustee on behalf of the trust will execute, and the property trustee will authenticate and deliver, preferred trust securities in definitive registered form, in any authorized denominations, in an aggregate stated liquidation amount equal to the liquidation amount of the global preferred trust securities in exchange for such global preferred trust securities. In addition, the trust may at any time and in its sole discretion determine not to have any preferred trust securities represented by one or more global preferred trust securities, and, in such event, an administrative trustee on behalf of the trust will execute and the property trustee will authenticate and deliver preferred trust securities in definitive registered form, in an aggregate stated liquidation amount equal to the liquidation amount of the global preferred trust securities, in exchange for such global preferred trust securities.

Books and Records

        The books and records of the trust will be maintained at the principal office of the trust and will be open for inspection by each holder of preferred trust securities or any authorized representative for any purpose reasonably related to the holder's interest in the trust during normal business hours.

Payment of Preferred Trust Securities and Paying Agent

        Unless we indicate differently in a prospectus supplement, payments in respect of the preferred trust securities will be made to the depositary, which will credit the relevant participants' accounts on the applicable distribution dates or, if the preferred trust securities are not held by the depositary, such payments will be made on the applicable distribution dates by check mailed to the address of the holder entitled thereto as such address appears on the preferred trust security register. The paying agent shall initially be the property trustee and any co-paying agent chosen by the property trustee and acceptable to the administrative trustees and us, which may be us. The paying agent may resign upon 30 days' written notice to the administrative trustees, the property trustee and us. In the event that the property trustee shall no longer be the paying agent, the administrative trustees shall appoint a

23

successor, which shall be a bank, trust company or affiliate of ours acceptable to the property trustee and us to act as paying agent.

Registrar and Transfer Agent

        The property trustee will act as registrar and transfer agent for the preferred trust securities. Registration of transfers of preferred trust securities will be made without charge by or on behalf of the trust, but the trust may require payment of any tax or other governmental charges that may be imposed in connection with any transfer or exchange of preferred trust securities.

Duties of the Trustees

        The number of trustees of the trust will initially be five. Three of the trustees will be administrative trustees, who are our officers or employees. The fourth trustee will be The Bank of New York (Delaware), as Delaware trustee, which will act as the resident trustee in the State of Delaware and will have no other significant duties. The fifth trustee will be The Bank of New York, as property trustee, which will hold the debt securities on behalf of the trust and will maintain a payment account with respect to the preferred trust securities and common trust securities, and will also act as trustee under the trust agreement for the purposes of the Trust Indenture Act.

        The administrative trustees of the trust are authorized and directed to conduct the affairs of the trust and to operate the trust so that (1) the trust will not be deemed to be an "investment company" required to be registered under the Investment Company Act, (2) the trust will not be taxed as a corporation, (3) the trust will not be classified as other than a grantor trust for United States federal income tax purposes and (4) the debt securities will be treated as our indebtedness for United States federal income tax purposes. In this regard, we and the administrative trustees are authorized to take any action, not inconsistent with applicable law, the certificate of trust or the trust agreement that we and the administrative trustees determine in their discretion to be necessary or desirable for those purposes, as long as the action does not materially adversely affect the interests of the holders of the preferred trust securities.

        The property trustee will own and hold for your benefit our debt securities purchased by the trust. The property trustee will also:

•

generally exercise the rights, powers and privileges of a holder of the debt securities, including the right to enforce our obligations under the debt securities upon the occurrence of an event of default under the indenture;



•

maintain exclusive control of a segregated non-interest bearing bank account to hold all payments on the debt securities; and



•

promptly make distributions to the holders of the trust securities out of funds from the property account.

        The property trustee will not be liable for any action taken, suffered or omitted to be taken by it without negligence, in good faith and reasonably believed by it to be authorized or within the discretion, rights or powers conferred upon it by the trust agreement. The property trustee will be under no obligation to exercise any rights or powers vested in it by the trust agreement at the request of a holder of trust securities, unless the holder provides the property trustee security and indemnity, reasonably satisfactory to the property trustee, against the costs and expenses and liabilities that might be incurred.

        Any entity into which the property trustee, the Delaware trustee or any administrative trustee that is not a natural person may be merged or converted or with which it may be consolidated, or any entity resulting from any merger, conversion or consolidation to which such trustee may be a party, or any

24

entity succeeding to all or substantially all the corporate trust business of such trustee, will be the successor of such trustee under the trust agreement, provided that such entity is otherwise qualified and eligible.

        Because we will own all of the common trust securities of the trust, we will have the exclusive right to appoint, remove or replace trustees and to increase or decrease the number of trustees.

        The duties and obligations of the trustees of the trust will be governed by the trust agreement, the Delaware Statutory Trust Act and the Trust Indenture Act.

Miscellaneous

        Holders of the preferred trust securities have no preemptive or similar rights.

Governing Law

        The trust agreement, the preferred trust securities and the common trust securities provide that they are to be governed by and construed in accordance with the laws of the State of Delaware.

DESCRIPTION OF THE PREFERRED SECURITIES GUARANTEE

        Selected provisions of the preferred securities guarantee that we will execute and deliver for the benefit of the holders of the preferred trust securities are summarized below. The summary is not complete. The form of preferred securities guarantee was filed with the SEC and you should read the preferred securities guarantee for provisions that may be important to you. The preferred securities guarantee will be qualified as an indenture under the Trust Indenture Act. You should refer to the Trust Indenture Act for provisions that apply to the preferred securities guarantee. Whenever particular defined terms of the preferred securities guarantee are referred to, those defined terms are incorporated into this prospectus by reference.

        The Bank of New York will act as guarantee trustee under the preferred securities guarantee. The guarantee trustee will hold the preferred securities guarantee for the benefit of the holders of the preferred trust securities.

General

        We will irrevocably, fully and unconditionally agree to make the guarantee payments listed below in full to the holders of the preferred trust securities if they are not made by the trust, as and when due, regardless of any defense, right of set-off or counterclaim that the trust may have or assert. The following payments will be subject to the preferred securities guarantee (without duplication):

•

any accumulated and unpaid distributions required to be paid on preferred trust securities, to the extent the trust has funds available therefor;



•

the redemption price, plus all accumulated and unpaid distributions, for any preferred trust securities called for redemption by the trust, to the extent the trust has funds available therefor; and



•

upon a voluntary or involuntary dissolution, winding-up or termination of the trust (except in connection with the distribution of debt securities to the holders in exchange for preferred trust securities as provided in the trust agreement or upon a redemption of all of the preferred trust

25

securities upon maturity or redemption of the debt securities as provided in the trust agreement), the lesser of:

•

the aggregate of the liquidation preference and all accumulated and unpaid distributions on preferred trust securities to the date of payment, to the extent the trust has funds available therefor; and



•

the amount of assets of the trust remaining available for distribution to holders of preferred trust securities in liquidation of the trust after satisfaction of liabilities to creditors of the trust as required by applicable law.

        Our obligation to make a guarantee payment may be satisfied by direct payment of the required amounts by us to the holders of preferred trust securities or by causing the trust to pay such amounts to those holders.

        The preferred securities guarantee will be a guarantee with respect to the preferred trust securities, but will not apply to any payment of distributions if and to the extent that the trust does not have funds available to make those payments.

        If we fail to make interest payments on the debt securities held by the trust, the trust will not have funds available to pay distributions on the preferred trust securities. The preferred securities guarantee does not limit us from incurring or issuing additional debt, whether secured or unsecured, senior to or equal in right of payment to the preferred securities guarantee in the future.

        We will agree to provide funds to the trust as needed to pay costs, expenses or liabilities of the trust to parties other than holders of preferred trust securities or common trust securities. The debt securities and the preferred securities guarantee, together with our obligations with respect to the preferred trust securities under the indenture, the trust agreement, the preferred securities guarantee, including the agreement by us to pay expenses and obligations of the trust to parties (other than holders of preferred trust securities or common trust securities), constitute a full and unconditional guarantee of the preferred trust securities by us. No single document standing alone or operating in conjunction with fewer than all of the other documents constitutes that guarantee. It is only the combined operation of these documents that has the effect of providing a full and unconditional guarantee by us of the preferred trust securities.

Amendments and Assignment

        No consent of holders of preferred trust securities is required for changes to the preferred securities guarantee that do not materially adversely affect their rights. Other terms of the preferred securities guarantee may be changed only with the prior approval of the holders of the preferred trust securities having at least a majority of the liquidation preference amount of the outstanding preferred trust securities. All guarantees and agreements contained in the preferred securities guarantee will bind the successors, assigns, receivers, trustees and representatives of ours and will inure to the benefit of the holders of the preferred trust securities then outstanding. We may assign our obligations under the preferred securities guarantee only in connection with a consolidation, merger or asset sale involving us permitted under the indenture.

Events of Default

        An event of default under the preferred securities guarantee will occur if we fail to perform any of our payment or other obligations under the preferred securities guarantee and have not cured such failure within 90 days of receipt of notice thereof. The holders of the preferred trust securities having a majority of the liquidation amount of the preferred trust securities have the right to direct the time, method and place of conducting any proceeding for any remedy available to the guarantee trustee

26

under the preferred securities guarantee or to direct the exercise of any trust or power conferred upon the guarantee trustee under the preferred securities guarantee.

        If the guarantee trustee fails to enforce the preferred trust securities guarantee or we fail to make a guarantee payment, you may institute a legal proceeding directly against us to enforce the guarantee trustee's rights under the preferred securities guarantee without first instituting a legal proceeding against the trust, the guarantee trustee or anyone else.

        We will be required to file an annual statement with the guarantee trustee as to our compliance with the preferred securities guarantee.

        During any extended interest period, or for so long as an "event of default" under the indenture or any payment default under the preferred securities guarantee has occurred and is continuing, we may not:

•

declare or pay any dividend or distribution on our capital stock;



•

redeem, purchase, acquire or make a liquidation payment with respect to any of our capital stock; or



•

pay any principal, interest or premium on, or repay, repurchase or redeem any debt securities that are equal or junior in right of payment with the debt securities; or make any guarantee payments with respect to any guarantee by us of the debt of any of our subsidiaries if such guarantee ranks equally with a junior interest to the debt securities.

However, even during such circumstances, we may:

•

purchase or acquire our capital stock in connection with the satisfaction by us of our obligations under any employee benefit plans or pursuant to any contract or security outstanding on the first day of any such event requiring us to purchase our capital stock;



•

reclassify our capital stock or exchange or convert one class or series of our capital stock for another class or series of our capital stock;



•

purchase fractional interests in shares of our capital stock pursuant to the conversion or exchange provisions of such capital stock or the security being converted or exchanged;



•

declare dividends or distributions in our capital stock;



•

redeem or repurchase any rights pursuant to a rights agreement; and



•

make payments under the preferred securities guarantee related to the preferred trust securities.

Duties of the Guarantee Trustee

        The guarantee trustee will undertake to perform only those duties specifically set forth in the preferred securities guarantee until a default occurs. After a default under the preferred securities guarantee, the guarantee trustee must exercise the same degree of care and skill in its duties as a prudent individual would exercise or use under the circumstances in the conduct of his or her own affairs. The preferred securities guarantee trustee is under no obligation to exercise any of the powers vested in it by the preferred securities guarantee at the request of any holder of the preferred trust securities unless it is offered reasonable indemnity against the costs, expenses and liabilities that it might incur.

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Termination of the Preferred Securities Guarantee

        The preferred securities guarantee will terminate and be of no further force and effect upon:

•

full payment of the redemption price, plus accrued and unpaid distributions, for all the preferred trust securities;



•

the distribution of debt securities to holders of the preferred trust securities in exchange for all of the trust securities; or



•

full payment of the amounts payable upon liquidation of the trust.

        The preferred securities guarantee will continue to be effective or will be reinstated, as the case may be, if at any time any holder of preferred trust securities must restore payment of any sums paid under the preferred trust securities or the preferred securities guarantee.

Status of the Preferred Securities Guarantee

        The applicable prospectus supplement will set out the status of the preferred securities guarantee.

        The trust agreement provides that by accepting preferred trust securities, a holder agrees to the status and other terms of the preferred securities guarantee.

        The preferred securities guarantee will be a guarantee of payment and not of collection, that is, the guarantee trustee may institute a legal proceeding directly against us to enforce its rights under the preferred securities guarantee without first instituting a legal proceeding against anyone else.

        Because we are a holding company that conducts all of its operations through subsidiaries, obligations under the preferred securities guarantee, as obligations of a holding company, will generally have a position junior to claims of creditors and preferred stockholders of our subsidiaries. See "The Company" above.

Governing Law

        The preferred securities guarantee provides that it is to be governed by and construed in accordance with the laws of the State of New York.

RELATIONSHIP AMONG THE PREFERRED TRUST SECURITIES,
THE DEBT SECURITIES AND THE PREFERRED SECURITIES GUARANTEE

        To the extent set forth in the preferred securities guarantee and to the extent funds are available, we will irrevocably guarantee the payment of distributions and other amounts due on the trust securities. If and to the extent we do not make payments on the debt securities, the trust will not have sufficient funds to pay distributions or other amounts due on the trust securities. The preferred securities guarantee does not cover any payment of distributions or other amounts due on the trust securities unless the trust has sufficient funds for the payment of such distributions or other amounts. In such event, a holder of trust securities may institute a legal proceeding directly against us to enforce payment of such distributions or other amounts to such holder after the respective due dates. Taken together, our obligations under the trust agreement, the debt securities, the indenture and the preferred securities guarantee provide a full and unconditional guarantee of payments of distributions and other amounts due on the trust securities. No single document standing alone or operating in conjunction with fewer than all of the other documents constitutes such guarantee. It is only the combined operation of these documents that provides a full and unconditional guarantee of the trust's obligations under the trust securities.

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Sufficiency of Payments

        As long as payments of interest and other amounts are made when due on the debt securities, such payments will be sufficient to cover distributions and payments due on the trust securities because of the following factors:

•

the aggregate principal amount of the debt securities will be equal to the sum of the aggregate stated liquidation amount of the trust securities;



•

the interest rate and the interest and other payment dates on the debt securities will match the distribution rate and distribution and other payment dates for the trust securities;



•

we, as issuer of the debt securities, will pay, and the trust will not be obligated to pay, directly or indirectly, any costs, expenses, debts and obligations of the trust (other than with respect to the trust securities); and



•

the trust agreement further provides that the trust will not engage in any activity that is not consistent with the limited purposes of the trust.

        Notwithstanding anything to the contrary in the indenture, we have the right to set off any payment we are otherwise required to make thereunder against and to the extent we have already made, or are concurrently on the date of such payment making, a related payment under the preferred securities guarantee.

Enforcement Rights of Holders of Preferred Trust Securities

        The trust agreement provides that if we fail to make interest or other payments on the debt securities when due (taking account of any extension period), the holders of the preferred trust securities may direct the property trustee to enforce its rights under the indenture. If the property trustee fails to enforce its rights under the indenture in respect of an event of default under that indenture, any holder of record of preferred trust securities may, to the fullest extent permitted by applicable law, institute a legal proceeding against us to enforce the property trustee's rights under the indenture without first instituting any legal proceeding against the property trustee or any other person or entity. Notwithstanding the foregoing, if a trust enforcement event has occurred and is continuing and such event is attributable to our failure to pay interest, premium or principal on the debt securities on the date such interest, premium or principal is otherwise payable, then a holder of preferred trust securities may institute a direct action against us for payment of such holder's pro rata share. If a holder brings such a direct action, we will be entitled to that holder's rights under the trust agreement to the extent of any payment made by us to that holder.

        If we fail to make payments under the preferred securities guarantee, a holder of preferred trust securities may institute a proceeding directly against us for enforcement of the guarantee for such payments.

Limited Purpose of Trust

        The trust preferred securities evidence undivided beneficial ownership interest in the trust, and the trust exists for the sole purpose of issuing and selling the trust securities and using the proceeds to purchase our debt securities. A principal difference between the rights of a holder of preferred trust securities and a holder of debt securities is that a holder of debt securities is entitled to receive from us the principal amount of and interest accrued on the debt securities held, while a holder of preferred trust securities is entitled to receive distributions and other payments from the trust (or from us under the preferred securities guarantee) only if and to the extent the trust has funds available for the payment of such distributions and other payments.

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Rights upon Dissolution

        Upon any voluntary or involuntary dissolution, winding-up or liquidation of the trust involving the redemption or repayment of the debt securities, the holders of the trust securities will be entitled to receive, out of assets held by the trust, subject to the rights of creditors of the trust, if any, the liquidation distribution in cash. Because we are the guarantor under the preferred securities guarantee and, as issuer of the debt securities, we have agreed to pay for all costs, expenses and liabilities of the trust (other than the trust's obligations to the holders of the trust securities), the positions of a holder of trust securities and a holder of debt securities relative to other creditors and to our shareholders in the event of our liquidation or bankruptcy would be substantially the same.

DESCRIPTION OF STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS

        We may issue stock purchase contracts representing contracts obligating holders to purchase from us, and us to sell to the holders, a specified or varying number of shares of our common stock at a future date or dates. Alternatively, the stock purchase contracts may obligate us to purchase from holders, and obligate holders to sell to us, a specified or varying number of shares of common stock. The price per share of our common stock and number of shares of our common stock may be fixed at the time the stock purchase contracts are issued or may be determined by reference to a specific formula set forth in the stock purchase contracts. The stock purchase contracts may be issued separately or as a part of a stock purchase unit that consists of (a) a stock purchase contract and (b) debt securities, preferred trust securities or debt obligations of third parties (including United States Treasury securities), other stock purchase contracts or common stock, in each case that would secure the holders' obligations to purchase or to sell, as the case may be, our common stock under the stock purchase contract. The stock purchase contracts may require us to make periodic payments to the holders of the stock purchase units or vice-versa. These payments may be unsecured or prefunded on some basis and may be paid on a current or on a deferred basis. The stock purchase contracts may require holders to secure their obligations thereunder in a specified manner.

        The applicable prospectus supplement will describe the terms of any stock purchase contract or stock purchase units and will contain a discussion of the material United States federal income tax considerations applicable to the stock purchase contracts and stock purchase units. The description in the applicable prospectus supplement will not necessarily be complete, and reference will be made to the stock purchase contracts, and, if applicable, collateral or depositary arrangements, relating to the stock purchase contracts or stock purchase units.

DESCRIPTION OF CAPITAL STOCK

        The description below is a summary of certain provisions of our capital stock.

Authorized Capital

        Our authorized capital stock consists of 600,000,000 shares of common stock, par value $0.01 per share and 10,000,000 shares of preferred stock, par value $0.01 per share.

Common Stock

        General.    As of October 31, 2002, 168,326,377 shares of our common stock were issued and outstanding. The outstanding shares of our common stock is, and our common stock offered hereby when issued and paid for will be, fully paid and non-assessable. This description of our common stock is not complete and is qualified by referring to the description contained or incorporated in our Form 8-B filed with the SEC on September 1, 1994.

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        Voting Rights.    Holders of our common stock are entitled to one vote for each share held by them on all matters presented to shareholders. In the election of directors, shareholders do not have cumulative voting rights.

        Liquidation Rights.    After satisfaction of the preferential liquidation rights of any Preferred Stock, the holders of our common stock are entitled to share, ratably, in the distribution of all remaining net assets.

        No Preemptive Conversion, or Redemption Rights.    The holders of our common stock do not have preemptive rights as to additional issues of our common stock or conversion rights. The shares of our common stock are not subject to redemption or to any further calls or assessments and are not entitled to benefit of any sinking fund provisions.

Transfer Agents and Registrars

        The transfer agents and registrars for our common stock are Cinergy Corp. and Fifth Third Bank, respectively.

Preferred Stock

        Our board of directors is authorized, without further shareowner action, to divide the preferred stock into one or more classes or series and to determine the designations, preferences, limitations and special rights of any class or series including, but not limited to, the following:

•

the rate of dividend, if any;



•

the rights, if any, of the holders of shares of the series upon our voluntary or involuntary liquidation, dissolution or winding up;



•

the terms and conditions upon which shares may be converted into shares of other series or other capital stock, if issued with the privilege of conversion;



•

the price at and the terms and conditions upon which shares may be redeemed; and



•

the voting rights, if any.

        No shares of preferred stock have been issued.

PLAN OF DISTRIBUTION

        We and the trust may sell the securities directly to purchasers or indirectly through underwriters, dealers or agents. The names of any such underwriters, dealers or agents will be set forth in the relevant prospectus supplement. We will also set forth in the relevant prospectus supplement:

•

the terms of the offering of the securities;



•

the proceeds we will receive from such a sale;



•

any underwriting discounts and other items constituting underwriters' compensation;



•

any initial public offering price;



•

any discounts or concessions allowed or reallowed or paid to dealers; and



•

any securities exchanges on which we may list the securities.

        We and the trust may distribute the securities from time to time in one or more transactions at:

•

a fixed price;



•

prices that may be changed;

31

•

market prices at the time of sale;



•

prices related to prevailing market prices; and



•

negotiated prices.

        We will describe the method of distribution in the relevant prospectus supplement.

        If we use underwriters with respect to a series of the securities, we will set forth in the relevant prospectus supplement:

•

the name of the managing underwriter, if any;



•

the name of any other underwriters; and



•

the terms of the transaction, including any underwriting discounts and other items constituting compensation of the underwriters and dealers, if any.

        The underwriters will acquire any securities for their own accounts and they may resell the securities from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price and at varying prices determined at the time of sale.

        Any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers may be changed from time to time. We anticipate that any underwriting agreement pertaining to any securities will:

•

entitle the underwriters to indemnification by us against certain civil liabilities under the Securities Act, or to contribution with respect to payments that the underwriters may be required to make related to any such civil liability;



•

subject the obligations of the underwriters to certain conditions precedent; and



•

obligate the underwriters to purchase all securities offered in a particular offering if any such securities are purchased.

        In connection with an offering of the securities, underwriters may engage in transactions that stabilize, maintain or otherwise affect the price of the securities. Specifically, underwriters may:

•

overallot in connection with the offering, creating a syndicate short position;



•

bid for, and purchase, the securities in the open market to cover syndicate short positions;



•

bid for, and purchase, the securities in the open market to stabilize the price of the securities; and



•

reclaim selling concessions allowed for distributing the securities in the offering if the syndicate repurchases previously distributed the securities in syndicate covering transactions, in stabilization transactions or otherwise.

        Any of these activities may stabilize or maintain the market price of the securities above independent market levels. Underwriters are not required to engage in these activities, and may end any of these activities at any time.

        If we use a dealer in an offering of the securities, we will sell such securities to the dealer, as principal. The dealer may then resell the securities to the public at varying prices to be determined by such dealer at the time of resale. We will set forth the name of the dealer and the terms of the transaction in the prospectus supplement.

        If we use an agent in an offering of the securities, we will name the agent and describe the terms of the agency in the relevant prospectus supplement. Unless we indicate otherwise in the prospectus supplement, we will require an agent to act on a best efforts basis for the period of its appointment.

32

        Dealers and agents named in a prospectus supplement may be considered underwriters of the securities described in the prospectus supplement under the Securities Act. We may indemnify them against certain civil liabilities under the Securities Act. In the ordinary course of business, we may engage in transactions with underwriters, dealers and agents and they may perform services for us.

        We and the trust may solicit offers to purchase the securities and make sales directly to institutional investors or others who may be considered underwriters under the Securities Act with respect to such sales. We will describe the terms of any such offer in the relevant prospectus supplement.

        If we authorize underwriters or other agents to solicit offers to purchase the securities from institutional investors pursuant to contracts providing for payment and delivery at a future date, we will indicate that we are doing so in the relevant prospectus supplement. We must approve all purchasers under such contracts; the institutional investors may include commercial and savings banks, insurance companies, pension funds, investment companies, educational and charitable institutions and others. We will not subject the obligations of such purchasers to any conditions except that:

•

we will not allow such purchases if they violate the laws of any jurisdiction to which a proposed purchaser is subject; and



•

if we are also selling the securities to underwriters, we will not sell to the underwriters subject to delayed delivery.

        Underwriters and other agents will not be responsible for the validity or performance of such contracts providing for payment and delivery at a future date.

        Offered securities may also be offered and sold, if so indicated in the applicable prospectus supplement, in connection with a remarketing upon their purchase, in accordance with a redemption or repayment pursuant to their terms, or otherwise, by one or more remarketing firms, acting as principals for their own accounts or as agents for us. Any remarketing firm will be identified and the terms of its agreements, if any, with us and its compensation will be described in the applicable prospectus supplement.

        We will set forth in the relevant prospectus supplement the anticipated delivery date of the securities and the prospectus delivery obligations of dealers.

LEGAL MATTERS

        Unless otherwise indicated in the applicable prospectus supplement, certain legal matters with respect to the securities to be issued by us will be passed upon for us by Taft, Stettinius & Hollister LLP, Cincinnati, Ohio.

        Certain matters of Delaware law relating to the validity of the preferred trust securities, the enforceability of the trust agreement and the creation of the trust will be passed upon by Richards, Layton & Finger, P.A., Wilmington, Delaware, special Delaware counsel to the trust. Additional legal matters may be passed on for any underwriters by counsel which we will name in the applicable prospectus supplement.

33

INDEPENDENT PUBLIC ACCOUNTANTS

        Cinergy Corp.'s financial statements and schedules incorporated in this prospectus by reference to the Annual Report on Form 10-K for the year ended December 31, 2001 have been audited by Arthur Andersen LLP, independent public accountants, and are incorporated by reference in reliance upon the authority of such firm as experts in accounting and auditing.

        Because we have not been able to obtain, after reasonable efforts, the written consent of Arthur Andersen LLP to our naming it in this prospectus as having certified our financial statements for the three years ended December 31, 2001, as required by Section 7 of the Securities Act, we have dispensed with the filing of their consent in reliance on Rule 437a promulgated under the Securities Act. Consequently, your ability to assert claims against Arthur Andersen LLP will be limited. In particular, because of this lack of consent, you will not be able to sue Arthur Andersen LLP under Section 11(a)(4) of the Securities Act for any untrue statements of a material fact contained in the financial statements audited by Arthur Andersen or any omissions to state a material fact required to be stated in those financial statements. Therefore, your right of recovery under that section will be limited.

        On April 30, 2002, Cinergy Corp. filed a Current Report on Form 8-K announcing that its board of directors approved the selection of Deloitte & Touche LLP as its independent public accountants for the fiscal year 2002, replacing Arthur Andersen LLP. The decision to change independent public accountants was not the result of any disagreement with Arthur Andersen LLP on matters of accounting principles or practices, financial statement disclosure or auditing scope and procedure.

34

PART II.

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14.    Other Expenses of Issuance and Distribution.

Securities and Exchange Commission registration fee		$	69,000
Rating Agency fees			495,000
Printing expenses			85,000
Trustee fees and expenses			20,000
Legal fees and expenses			200,000
Accounting fees and expenses			40,000
Miscellaneous			41,000
	TOTAL	$	950,000

All of the above except the Securities and Exchange Commission registration fee are estimated.

Item 15.    Indemnification of Directors and Officers.

        As a Delaware corporation subject to the Delaware General Corporation Law, Cinergy Corp. is empowered by Section 145 of such law to indemnify officers and directors against certain expenses, liabilities and payments, as therein provided. Article VI of Cinergy Corp.'s By-Laws provides that Cinergy Corp. shall indemnify specified persons, including its officers and directors against liabilities under certain circumstances. Also, Article VI provides that Cinergy Corp. may purchase and maintain insurance on behalf of or for any director, officer, employee or agent for protection against certain liabilities or claims asserted against such persons. In addition, Article Sixth of Cinergy Corp.'s Certificate of Incorporation provides limits to the personal liability of its directors for breach of fiduciary duties to the fullest extent permitted by the Delaware General Corporation Law.

        The Registrant maintains an insurance policy covering its directors and officers against certain civil liabilities, including liabilities under the Securities Act.

        Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers, or persons controlling the Registrant pursuant to the foregoing provisions, the Registrant has been informed that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

        The Amended and Restated Declaration of Trust will provide for indemnification of the Delaware Trustee and each of the administrative trustees by Cinergy Corp. against any loss, damage, claims, liability, penalty or expense of any kind incurred by the trustees in connection with the performance of their duties or powers under the agreement in a manner reasonably believed by the trustee to be within the scope of its authority under the agreement, except that none of these trustees will be so indemnified for any loss, damage or claim incurred by reason of such trustee's gross negligence, bad faith or willful misconduct. Similarly, the agreement provides for indemnification of the Property Trustee, except that the Property Trustee is not indemnified from liability for its own negligent action, negligent failure to act or willful misconduct. Under the agreement, Cinergy Corp. agrees to advance those expenses incurred by any trustee in defending any such claim, demand, action, suit or proceeding.

Item 16.    Exhibits.

        Reference is made to the Exhibit Index filed herewith at page II-5, such Exhibit Index being incorporated in this Item 16 by reference.

II-1

Item 17.    Undertakings.

        The undersigned registrants hereby undertake:

(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 Commission 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; and

(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 (i) and (ii) 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 Commission by the registrants pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in 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 post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(4)

That, for purposes of determining any liability under the Securities Act of 1933, each filing of Cinergy Corp.'s annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in this Registration Statement shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

        Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrants pursuant to the provisions described under Item 15 above, or otherwise, the registrants have been advised that in the opinion of the 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 a registrant of expenses incurred or paid by a director, officer or controlling person in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, such 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-2

SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, as amended, Cinergy Corp. 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 Cincinnati, Ohio on the 15th day of January, 2003.

CINERGY CORP.     (Registrant)
By:	JAMES E. ROGERS* James E. Rogers Chairman of the Board, President and Chief Executive Officer

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

Signatures	Title	Date
(i) Principal executive officer:
JAMES E. ROGERS* James E. Rogers	Chairman of the Board, President and Chief Executive Officer	January 15, 2003
(ii) Principal financial officer:
/s/  R. FOSTER DUNCAN R. Foster Duncan	Executive Vice President and Chief Financial Officer	January 15, 2003
(iii) Principal accounting officer:
/s/  BERNARD F. ROBERTS Bernard F. Roberts	Vice President and Comptroller	January 15, 2003
(iv) Majority of Directors:
MICHAEL G. BROWNING*	Director	January 15, 2003
PHILLIP R. COX*	Director	January 15, 2003
GEORGE C. JUILFS*	Director	January 15, 2003
THOMAS E. PETRY*	Director	January 15, 2003
JAMES E. ROGERS*	Director	January 15, 2003
MARY L. SCHAPIRO*	Director	January 15, 2003
JOHN J. SCHIFF, JR.*	Director	January 15, 2003
PHILIP R. SHARP*	Director	January 15, 2003
DUDLEY S. TAFT*	Director	January 15, 2003

*By:	/s/  WENDY L. AUMILLER
	Wendy L. Aumiller, Attorney-in-fact

II-3

SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, as amended, CC Funding Trust II 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 Cincinnati, Ohio on the 15th day of January, 2003.

CC FUNDING TRUST II     (Registrant)
By:	CINERGY CORP., as Sponsor
By:	JAMES E. ROGERS* James E. Rogers Chairman of the Board, President and Chief Executive Officer

*By:	/s/  WENDY L. AUMILLER
	Wendy L. Aumiller, Attorney-in-fact

II-4

EXHIBIT INDEX

4.1	Certificate of Incorporation of Cinergy Corp. (filed as Exhibit 3-b to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2001 and incorporated by reference herein)
4.2	By-Laws of Cinergy Corp. (filed as Exhibit 3-ii-a to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2002 and incorporated by reference herein)
4.3	Indenture dated September 12, 2001 between Cinergy Corp. and Fifth Third Bank, as trustee (the "Indenture") (filed as Exhibit 4-a to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2001 and incorporated by reference herein)
4.4	Declaration of Trust of CC Funding Trust II
4.5	Form of Amended and Restated Declaration of Trust
4.6	Certificate of Trust of CC Funding Trust II
4.7	Form of Trust Preferred Security (included in Exhibit 4.5)
4.8	Form of Cinergy Corp. Preferred Securities Guarantee Agreement
4.9	Form of Purchase Contract Agreement
4.10	Form of Pledge Agreement
4.11	Form of Certificate of Designation (filed as Exhibit 4.12 to the Company's Registration Statement No. 333-74086 and incorporated by reference herein)
4.12	Specimen stock certificate representing common stock (filed as Exhibit 4.13 to the Company's Registration Statement No. 333-74086 and incorporated by reference herein)
4.13	Form of Stock Purchase Unit (included in the Form of Purchase Contract Agreement filed as Exhibit 4.9 hereto)
4.14	Form of Treasury Stock Purchase Unit (included in the Form of Purchase Contract Agreement filed as Exhibit 4.9 hereto)
5.1	Opinion of Taft, Stettinius & Hollister LLP
5.2	Opinion of Richards, Layton & Finger, P.A.
12.1	Computation of ratio of earnings to fixed charges and ratio of earnings to fixed charges and preferred stock dividends
23.1	Consent of Arthur Andersen LLP (omitted pursuant to Rule 437a of the Securities Act)
23.2	Consent of Taft, Stettinius & Hollister LLP (included in Exhibit 5.1)
23.3	Consent of Richards, Layton & Finger, P.A. (included in Exhibit 5.2)

II-5

24.1	Power of Attorney for Cinergy Corp.
24.2	Certified copy of a resolution of the Cinergy Corp. Board of Directors
25.1	Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of Fifth Third Bank, as trustee under the Indenture, on Form T-1
25.2	Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of The Bank of New York, as property trustee, relating to CC Funding Trust II, on Form T-1
25.3	Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of The Bank of New York, as guarantee trustee, relating to CC Funding Trust II, on Form T-1

*

Cinergy Corp. will file as an exhibit to an amendment to this Registration Statement or to a Current Report on Form 8-K (i) any underwriting agreement, including any remarketing agreement, relating to securities offered hereby, (ii) the instruments setting forth the terms of any debt securities and (iii) any required opinion of counsel to Cinergy Corp. as to certain tax matters relative to securities offered hereby.

II-6

QuickLinks

TABLE OF CONTENTS
ABOUT THIS PROSPECTUS
WHERE YOU CAN FIND MORE INFORMATION
THE COMPANY
THE TRUST
USE OF PROCEEDS
RATIO OF EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
DIVIDENDS AND PRICE RANGE OF COMMON STOCK
CONSOLIDATED CAPITALIZATION
SELECTED CONSOLIDATED INCOME INFORMATION
ACCOUNTING TREATMENT RELATING TO PREFERRED TRUST SECURITIES
DESCRIPTION OF THE DEBT SECURITIES
DESCRIPTION OF THE PREFERRED TRUST SECURITIES
DESCRIPTION OF THE PREFERRED SECURITIES GUARANTEE
RELATIONSHIP AMONG THE PREFERRED TRUST SECURITIES, THE DEBT SECURITIES AND THE PREFERRED SECURITIES GUARANTEE
DESCRIPTION OF STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS
DESCRIPTION OF CAPITAL STOCK
PLAN OF DISTRIBUTION
LEGAL MATTERS
INDEPENDENT PUBLIC ACCOUNTANTS
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
SIGNATURES
EXHIBIT INDEX

EX-4.4

                                                                     EXHIBIT 4.4

     DECLARATION OF TRUST, dated as of January 9, 2003 between Cinergy Corp., a
Delaware corporation, as Sponsor (the "SPONSOR"), and The Bank of New York, as
trustee (the "PROPERTY TRUSTEE"), The Bank of New York (Delaware), as trustee
(the "DELAWARE TRUSTEE"), and Wendy L. Aumiller, as trustee (the "ADMINISTRATIVE
TRUSTEE," and together with the Property Trustee and the Delaware Trustee, the
"TRUSTEES"). The Sponsor and the Trustees hereby agree as follows:

     1.   The Delaware statutory trust created hereby shall be known as "CC
Funding Trust II" (the "TRUST"), in which name the Trustees, or the Sponsor to
the extent provided herein, may conduct the business of the Trust, make and
execute contracts, and sue and be sued.

     2.   The Sponsor hereby assigns, transfers, conveys and sets over to the
Trust the sum of $10. The Trust hereby acknowledges receipt of such amount from
the Sponsor, which amount shall constitute the initial trust estate. It is the
intention of the parties hereto that the Trust created hereby constitute a
statutory trust under Chapter 38 of Title 12 of the Delaware Code, 12 DEL. CODE
Section 3801 et. seq. (the "STATUTORY TRUST ACT"), and that this document
constitutes the governing instrument of the Trust. The Trustees are hereby
authorized and directed to execute and file a certificate of trust with the
Secretary of State of the State of Delaware in the form attached hereto in
accordance with the provisions of the Statutory Trust Act. The trust is hereby
established by the Sponsor and the Trustees for the purposes of (i) issuing
preferred securities representing undivided beneficial interests in the assets
of the Trust ("PREFERRED SECURITIES") in exchange for cash and investing the
proceeds thereof in debt securities of the Sponsor, (ii) issuing and selling
common securities representing an undivided beneficial interest in the assets of
the Trust ("COMMON SECURITIES") to the Sponsor in exchange for cash and
investing the proceeds thereof in additional debt securities of the Sponsor and
(iii) engaging in such other activities as are necessary or incidental thereto.

     3.   The Sponsor and the Trustees will enter into an Amended and Restated
Declaration of Trust, satisfactory to each such party and substantially in the
form included as an exhibit to the Securities Act Registration Statement
referred to below, to provide for the contemplated operation of the Trust
created hereby and the issuance of the Preferred Securities and Common
Securities referred to therein. Prior to the execution and delivery of such
Amended and Restated Declaration of Trust, the Trustees shall not have any duty
or obligation hereunder or with respect to the trust estate, except as otherwise
required by applicable law or as may be necessary to obtain prior to such
execution and delivery any licenses, consents or approvals required by
applicable law or otherwise.

     4.   The Sponsor, as the sponsor of the Trust, is hereby authorized (i) to
prepare and file with the Securities and Exchange Commission (the "COMMISSION")
and execute, in each case on behalf of the Trust, (a) a Registration Statement
on Form S-3 or on such other form or forms as may be appropriate, including
without limitation any registration statement of the type contemplated by Rule
462(b) of the Securities Act of 1933, as amended (the "SECURITIES ACT") (any
such registration statement, whether on Form S-3, another form or under Rule
462(b) being referred to herein as the "SECURITIES ACT REGISTRATION STATEMENT"),
including



any pre-effective or post-effective amendments to such Registration Statement,
relating to the registration under the Securities Act of the Preferred
Securities and certain other securities of the Sponsor and (b) if the Sponsor
shall deem it desirable, a Registration Statement on Form 8-A (the "EXCHANGE ACT
REGISTRATION STATEMENT"), including all pre-effective and post-effective
amendments thereto, relating to the registration of the Preferred Securities
under Section 12 of the Securities Exchange Act of 1934, as amended; (ii) if the
Sponsor shall deem it desirable, to prepare and file with New York Stock
Exchange, Inc. or any other automated quotation system, exchange or
over-the-counter market (collectively, the "EXCHANGES") and execute on behalf of
the Trust a listing application or applications and all other applications,
statements, certificates, agreements and other instruments as shall be necessary
or desirable to cause the Preferred Securities to be listed on any Exchange;
(iii) to prepare and file and execute on behalf of the Trust such applications,
reports, surety bonds, irrevocable consents, appointments of attorney for
service of process and other papers and documents as the Sponsor, on behalf of
the Trust, may deem necessary or desirable to register the Preferred Securities
under the securities or "Blue Sky" laws of such jurisdictions as the Sponsor, on
behalf of the Trust, may deem necessary or desirable; (iv) to negotiate the
terms of and execute on behalf of the Trust an underwriting or other purchase
agreement among the Trust, the Sponsor and any underwriter(s), dealer(s) or
agent(s) relating to the Preferred Securities, as the Sponsor, on behalf of the
Trust, may deem necessary or desirable; and (v) to execute and deliver on behalf
of the Trust letters or documents to, or instructions for filing with, a
depository relating to the Preferred Securities. In the event that any filing
referred to in clauses (i)-(iii) above is required by the rules and regulations
of the Commission, any Exchange, the National Association of Securities Dealers,
Inc. or state securities or blue sky laws, to be executed on behalf of the Trust
by a Trustee, any natural person appointed pursuant to Section 6 hereof, in his
or her capacity as trustee of the Trust, and the Sponsor are hereby authorized
to join in any such filing and to execute on behalf of the Trust any and all of
the foregoing.

     5.   This Declaration of Trust may be executed in one or more counterparts.

     6.   The number of Trustees initially shall be three (3) and thereafter the
number of Trustees shall be such number as shall be fixed from time to time by a
written instrument signed by the Sponsor that may increase or decrease the
number of Trustees; PROVIDED, HOWEVER, that the number of Trustees shall in no
event be less than three (3); and PROVIDED FURTHER that to the extent required
by the Statutory Trust Act, one Trustee shall either be a natural person who is
a resident of the State of Delaware or, if not a natural person, an entity that
has its principal place of business in the State of Delaware and meets other
requirements imposed by applicable law. Subject to the foregoing, the Sponsor is
entitled to appoint or remove without cause any Trustee at any time. Any Trustee
may resign upon thirty days' prior notice to the Sponsor.

     7.   The Trust may be dissolved and terminated at the election of the
Sponsor.

     8.   This Declaration of Trust shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws principles).



     9.   The Sponsor agrees to indemnify each of the Property Trustee, the
Delaware Trustee and the Administrative Trustee for, and to hold each of them
harmless against, any and all loss, damage, claim, liability or expense incurred
by such Trustee arising out of or in connection with the acceptance or
administration of the Trust, except to the extent such loss, damage, claim,
liability or expense is due to the negligence or bad faith of such Trustee.

     IN WITNESS WHEREOF, the parties hereto have caused this Declaration of
Trust to be duly executed as of the day and year first above written.


                                        CINERGY CORP.,
                                        as Sponsor


                                        By: /s/ Wendy L. Aumiller
                                           ----------------------
                                           Name: Wendy L. Aumiller
                                           Title: Treasurer


                                        THE BANK OF NEW YORK,
                                        as Property Trustee


                                        By: /s/ Paul J. Schmalzel
                                           ----------------------
                                           Name: Paul J. Schmalzel
                                           Title: Vice President


                                        THE BANK OF NEW YORK
                                         (DELAWARE),
                                        as Delaware Trustee


                                        By: /s/ William T. Lewis
                                           ---------------------
                                           Name: William T. Lewis
                                           Title: Senior Vice President


                                        WENDY L. AUMILLER,
                                        as Administrative Trustee


                                        /s/ Wendy L. Aumiller
                                        ---------------------

EX-4.5

                                                                     EXHIBIT 4.5


                                     AMENDED

                                       AND

                                    RESTATED

                              DECLARATION OF TRUST



                                TABLE OF CONTENTS

                                                                                   
                                    ARTICLE 1
                         INTERPRETATION AND DEFINITIONS

Section 1.01.  Interpretation and Definitions..........................................1

                                    ARTICLE 2
                               TRUST INDENTURE ACT

Section 2.01.  Trust Indenture Act; Application.......................................13
Section 2.02.  List of Holders of the Securities......................................13
Section 2.03.  Reports by the Property Trustee........................................13
Section 2.04.  Periodic Reports to the Property Trustee...............................14
Section 2.05.  Evidence of Compliance with Conditions Precedent.......................14

                                    ARTICLE 3
                                  ORGANIZATION

Section 3.01.  Name and Organization..................................................14
Section 3.02.  Office.................................................................14
Section 3.03.  Purpose................................................................14
Section 3.04.  Authority..............................................................15
Section 3.05.  Title to Property of the Trust.........................................15
Section 3.06.  Powers and Duties of the Administrative Trustees.......................15
Section 3.07.  Prohibition of Actions by the Trust and the Trustees...................18
Section 3.08.  Powers and Duties of the Property Trustee..............................19
Section 3.09.  Certain Duties and Responsibilities of the Property Trustee............21
Section 3.10.  Certain Rights of Property Trustee.....................................23
Section 3.11.  Delaware Trustee.......................................................25
Section 3.12.  Intentionally Omitted..................................................25
Section 3.13.  Not Responsible for Recitals or Issuance of Securities.................25
Section 3.14.  Duration of Trust......................................................25
Section 3.15.  Mergers................................................................25
Section 3.16.  Compensation and Reimbursement.........................................27
Section 3.17.  Property Trustee May File Proofs of Claim..............................27
Section 3.18.  Registration Statement and Related Matters.............................28
Section 3.19.  Books and Records......................................................28

                                    ARTICLE 4
                                   THE SPONSOR

Section 4.01.  Responsibilities of the Sponsor........................................29



                                        i


                                                                                   
                                    ARTICLE 5
                      THE HOLDERS OF THE COMMON SECURITIES

Section 5.01.  [Subordinated] Notes Issuer's Purchase of the Common Securities........29
Section 5.02.  Covenants of the [Subordinated] Notes Issuer...........................30
Section 5.03.  Holder of the Common Securities........................................30
Section 5.04.  Exchanges..............................................................30

                                    ARTICLE 6
                                  THE TRUSTEES

Section 6.01.  Number of Trustees.....................................................31
Section 6.02.  Delaware Trustee; Eligibility..........................................31
Section 6.03.  Property Trustee; Eligibility..........................................32
Section 6.04.  Qualifications of the Administrative Trustees Generally................32
Section 6.05.  Initial Administrative Trustees........................................33
Section 6.06.  Appointment, Removal and Resignation of the Trustees...................33
Section 6.07.  Vacancies among Trustees...............................................34
Section 6.08.  Effect of Vacancies....................................................35
Section 6.09.  Meetings...............................................................35
Section 6.10.  Delegation of Power by the Administrative Trustees.....................35
Section 6.11.  Merger, Consolidation, Conversion or Succession to Business............35

                                    ARTICLE 7
                             TERMS OF THE SECURITIES

Section 7.01.  General Provisions Regarding the Securities............................36
Section 7.02.  Distributions..........................................................39
Section 7.03.  Redemption of Securities...............................................40
Section 7.04.  Redemption Procedures..................................................41
Section 7.05.  Voting Rights of the Preferred Securities..............................42
Section 7.06.  Voting Rights of the Common Securities.................................45
Section 7.07.  Paying Agent...........................................................47
Section 7.08.  Listing................................................................47
Section 7.09.  Transfer of the Securities.............................................47
Section 7.10.  Mutilated, Destroyed, Lost or Stolen Certificates......................48
Section 7.11.  Deemed Holders.........................................................49
Section 7.12.  Global Certificates....................................................49
Section 7.13.  Remarketing............................................................50

                                    ARTICLE 8
                    DISSOLUTION AND TERMINATION OF THE TRUST

Section 8.01.  Dissolution and Termination of the Trust...............................53
Section 8.02.  Liquidation Distribution upon Dissolution of the Trust.................54



                                       ii


                                                                                   
                                    ARTICLE 9
 LIMITATION OF LIABILITY OF HOLDERS OF THE SECURITIES, THE DELAWARE TRUSTEE AND
                                     OTHERS

Section 9.01.  Liability..............................................................56
Section 9.02.  Exculpation............................................................56
Section 9.03.  Fiduciary Duty.........................................................57
Section 9.04.  Indemnification........................................................58
Section 9.05.  Outside Businesses.....................................................58

                                   ARTICLE 10
                                   ACCOUNTING

Section 10.01. Fiscal Year............................................................59
Section 10.02. Certain Accounting Matters.............................................59
Section 10.03. Banking................................................................60
Section 10.04. Withholding............................................................60

                                   ARTICLE 11
                             AMENDMENTS AND MEETINGS

Section 11.01. Amendments.............................................................60
Section 11.02. Meetings of the Holders of the Securities; Action by Written Consent...62

                                   ARTICLE 12
        REPRESENTATIONS OF THE PROPERTY TRUSTEE AND THE DELAWARE TRUSTEE

Section 12.01. Representations and Warranties of the Property Trustee.................64
Section 12.02. Representations and Warranties of the Delaware Trustee.................64

                                   ARTICLE 13
                                  MISCELLANEOUS

Section 13.01. Notices................................................................65
Section 13.02. Governing Law..........................................................66
Section 13.03. Intention of the Parties...............................................67
Section 13.04. Headings...............................................................67
Section 13.05. Successors and Assigns.................................................67
Section 13.06. Partial Enforceability.................................................67
Section 13.07. Counterparts...........................................................67



                                       iii


                             CROSS-REFERENCE TABLE*



Section of
Trust Indenture Act  ....................                  Section of
of 1939, as amended  ....................                  Declaration
- -------------------                                        -----------
                                                        
310(b)               ....................                  6.03(c) & (d)
311(a)               ....................                  2.02(b)
311(b)               ....................                  2.02(b)
312(b)               ....................                  2.02(b)
313                  ....................                  2.03
313(d)               ....................                  2.03
314                  ....................                  2.04
314(a)               ....................                  3.06(i)
314(c)               ....................                  2.05
316(a)               ....................                  7.05(j)-(l)
317(b)               ....................                  3.08(h)


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

                                       iv


                    AMENDED AND RESTATED DECLARATION OF TRUST

     This Amended and Restated Declaration of Trust of CC Funding Trust II
("Declaration"), dated as of ____________, 2003, by and among Cinergy Corp., a
Delaware corporation, as Sponsor, [         ], [         ] and [         ], as
the initial Administrative Trustees, [         ], an [         ] banking
corporation, as the initial Property Trustee, and [         ], a Delaware
statutory trust, as the initial Delaware Trustee, not in their individual
capacities but solely as Trustees, and the Holders, from time to time, of the
Securities representing undivided beneficial interests in the assets of the
Trust, to be issued pursuant to this Declaration.

     WHEREAS, certain of the Trustees and the Sponsor established CC Funding
Trust II (the "Trust"), a statutory trust under the Statutory Trust Act,
pursuant to a Declaration of Trust dated as of ___________, 2003, (the "Original
Declaration") and a Certificate of Trust (the "Certificate of Trust") filed with
the Secretary of State of the State of Delaware on _____________, 2003; and

     WHEREAS, the sole purpose of the Trust shall be to issue, sell and
repurchase certain securities representing undivided beneficial interests in the
assets of the Trust, to invest the proceeds from such sales in the
[Subordinated] Notes issued by the [Subordinated] Notes Issuer, to enter into
certain agreements in connection therewith and to engage in only those
activities necessary or incidental thereto; and

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

     NOW, THEREFORE, it being the intention of the parties hereto to continue
the Trust as a statutory trust under the Statutory Trust Act and that this
Declaration constitute the governing instrument of such statutory trust, the
trustees hereby declare that all assets contributed to the Trust be held in
trust for the benefit of the Holders, from time to time, of the Securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.

                                    ARTICLE 1
                         INTERPRETATION AND DEFINITIONS

     Section 1.01. INTERPRETATION AND DEFINITIONS. Unless the context otherwise
requires:

     (a)  capitalized terms used in this Declaration but not defined in the
preamble above shall have the meanings assigned to them in this Section 1.01;

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

     (c)  all references to "the Declaration" or "this Declaration" shall be to
this Declaration as modified, supplemented or amended from time to time;

                                        1


     (d)  all references in this Declaration to Articles, Sections, Recitals and
Exhibits shall be to Articles and Sections of, or Recitals and Exhibits to, this
Declaration unless otherwise specified;

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

     (f)  a reference to the singular shall include the plural and vice versa,
and a reference to any masculine form of a term shall include the feminine or
neuter form of a term, as applicable.

     (g)  the following terms shall have the following meanings:

     "Administrative Trustee" shall mean any trustee of the Trust other than the
Property Trustee and the Delaware Trustee.

     "Affiliate" of any specified Person shall mean 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 shall mean 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" shall have meanings correlative to
the foregoing.

     "Applicable Ownership Interest" shall mean, with respect to a Stock
Purchase Unit that includes the Treasury Portfolio, (A) a 1/40, or 2.5%,
undivided beneficial ownership interest in a $1,000 face amount of a principal
or interest strip in a U.S. treasury security included in such Treasury
Portfolio that matures on or prior to _____________ and (B) for each scheduled
interest payment date on the [Subordinated] Notes after the Tax Event Redemption
Date, ______%, undivided beneficial ownership interest in a $1,000 face amount
of a principal or interest strip in a U.S. treasury security included in such
Treasury Portfolio that matures on or prior to such date. Unless otherwise
specified, references in this Declaration to the "Applicable Ownership Interest
of the Treasury Portfolio" shall have meaning specified in clause (A) of this
definition.

     "Applicable Principal Amount" shall mean either (A) if the Tax Event
Redemption Date occurs prior to the Purchase Contract Settlement Date, the
aggregate principal amount of the [Subordinated] Notes corresponding to the
aggregate stated liquidation amount of the Preferred Securities that are
components of the Stock Purchase Units on the Tax Event Redemption Date or (B)
if the Tax Event Redemption Date occurs on or after the Purchase Contract
Settlement Date, the aggregate principal amount of the [Subordinated] Notes
corresponding to the aggregate stated liquidation amount of the Preferred
Securities outstanding on such Tax Event Redemption Date.

                                        2


     "Applicable Spread" shall mean the spread determined as set forth below,
based on the prevailing rating of the senior notes of the [Subordinated] Notes
Issuer in effect at the close of business on the Business Day immediately
preceding the date of a Failed Remarketing:



                   Prevailing Rating                            Spread
                   -----------------                            ------
                                                                  
                   AA/ "Aa"...........................               %
                   A/ "a".............................               %
                   BBB/ "Baa".........................               %
                   Below BBB/ "Baa"...................               %


     For purposes of this definition, the "prevailing rating" of the senior
notes of the [Subordinated] Notes Issuer shall be:

             (i)  AA/ "Aa" if the senior notes of the [Subordinated] Notes
     Issuer have a credit rating of AA- or better by S&P and "Aa3" or better by
     Moody's or the equivalent of such ratings by such agencies or a substitute
     rating agency or substitute rating agencies selected by the Remarketing
     Agent (after consultation with the [Subordinated] Notes Issuer);

            (ii)  if not under clause (i) above, then A/"a" if the senior notes
     of the [Subordinated] Notes Issuer have a credit rating of A- or better by
     S&P and "A3" or better by Moody's or the equivalent of such ratings by such
     agencies or a substitute rating agency or substitute rating agencies
     selected by the Remarketing Agent (after consultation with the
     [Subordinated] Notes Issuer);

           (iii)  if not under clause (i) or (ii) above, then BBB/"Baa" if the
     senior notes of the [Subordinated] Notes Issuer have a credit rating of
     BBB- or better by S&P and "Baa3" or better by Moody's or the equivalent of
     such ratings by such agencies or a substitute rating agency or substitute
     rating agencies selected by the Remarketing Agent (after consultation with
     the [Subordinated] Notes Issuer); or

            (iv)  if not under clauses (i) through (iii) above, then Below
     BBB/"Baa."

     Notwithstanding the foregoing, (A) if (i) the credit rating of the senior
notes of the [Subordinated] Notes Issuer by S&P shall be on the "Credit Watch"
of S&P with a designation of "negative implications" or "developing," or (ii)
the credit rating of the senior notes of the [Subordinated] Notes Issuer by
Moody's shall be on the "Corporate Credit Watch List" of Moody's with a
designation of "downgrade" or "uncertain," or, in each case, on any successor
list of S&P or Moody's with a substitute designation, the prevailing ratings of
the senior notes of the [Subordinated] Notes Issuer shall be deemed to be within
a range one full level lower in the above table than those actually assigned to
the senior notes of the [Subordinated] Notes Issuer by Moody's and S&P and (B)
if the senior notes of the [Subordinated] Notes Issuer are rated by only one
rating agency on or before the Remarketing Date, the prevailing rating shall at
all times be determined without reference to the rating of any other rating
agency; provided that if no such rating agency shall have in effect a rating for
the senior notes of the [Subordinated] Notes Issuer,

                                        3


and the Remarketing Agent is unable to identify a substitute rating agency or
rating agencies, as required above, the prevailing rating shall be Below BBB/
"baa."

     "Authorized Officer" of a Person shall mean any Person that is authorized
to bind such Person.

     "Beneficial Owner" shall mean, with respect to a Global Security, a Person
who is the beneficial owner of a book-entry interest in such Global Security as
reflected on the books of the Depositary or on the books of a Person maintaining
an account with such Depositary (directly as a Depositary Participant or as an
indirect participant, in each case in accordance with the rules of such
Depositary).

     "Business Day" shall mean any day other than a Saturday or Sunday or a day
on which banking institutions in the City of New York, New York, or Cincinnati,
Ohio are authorized or required by law or executive order to remain closed, or a
day on which the Indenture Trustee or the Property Trustee, is closed for
business.

     "Cash Settlement" shall have the meaning specified in the Purchase Contract
Agreement.

     "Certificate" shall mean a Common Security Certificate or a Preferred
Security Certificate.

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

     "Closing Date" shall mean the date on which the Preferred Securities are
initially issued and sold.

     "Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time, or any successor legislation. A reference to a specific section of the
Code refers not only to such specific section but also to any corresponding
provision of any federal tax statute enacted after the date of this Declaration,
as such specific section or corresponding provision is in effect on the date of
application of the provisions of this Declaration containing such reference.

     "Collateral Agent" shall mean [                ].

     "Commission" shall mean the Securities and Exchange Commission.

     "Common Securities" shall have the meaning specified in Section 7.01(a).

     "Common Security Certificate" shall mean a definitive certificate in fully
registered form representing a Common Security, substantially in the form of
Exhibit B hereto, with such changes and additions thereto or deletions therefrom
as may be required by ordinary usage, custom or practice.

                                        4


     "Common Securities Purchase Agreement" shall mean the Common Securities
Purchase Agreement dated as of ___________, 2003 between the Sponsor and the
Trust.

     "Compounded Distributions" shall have the meaning specified in Section
7.02(b).

     "Corporate Trust Office" shall mean the principal office of the Property
Trustee at which, at any particular time, its corporate trust business shall be
administered, which office at the date hereof is located at [ address ], Attn:
Corporate Trust Department.

     "Covered Person" shall mean (A) any officer, director, trustee,
shareholder, partner, member, representative, employee or agent of (i) the
Sponsor, (ii) any Affiliate of the Sponsor, (iii) the Trust or (iv) any
Affiliate of the Trust and (B) any Holder.

     "Delaware Trustee" shall have the meaning specified in Section 6.02.

     "Depositary" shall mean, with respect to Securities issuable in whole or
in part in the form of one or more Global Securities, a clearing agency
registered under the Exchange Act that is designated to act as depositary for
such Securities, and initially shall be The Depository Trust Company.

     "Depositary Participant" shall mean a member of, or participant in, the
Depositary.

     "Direct Action" shall have the meaning specified in Section 3.08(e).

     "Distribution" shall mean a distribution payable to the Holders in
accordance with Section 7.02.

     "Exchange Act" shall mean the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time, and the
rules and regulations promulgated thereunder.

     "Exchange Act Registration Statement shall have the meaning specified in
Section 4.01(d).

     "Failed Remarketing" shall have the meaning specified in Section 7.13(h).

     "Fiscal Year" shall have the meaning specified in Section 10.01.

     "Foreign Person" shall mean any Person that is not a United States Person.

     "Global Certificate" shall have the meaning specified in Section 7.01(h).

     "Guarantee" shall mean the Guarantee Agreement, dated as of
________________, 2003, of the Sponsor, as may be amended from time to time, in
respect of the Preferred Securities.

     "Holder" shall mean any holder of Securities, as registered on the books
and records of the Trust, such holder being a beneficial owner within the
meaning of the Statutory Trust Act, PROVIDED that in determining whether the
Holders of the requisite liquidation amount of Preferred Securities have voted
on any matter provided for in this Declaration, then for the purpose of such

                                        5


determination only (and not for any other purpose hereunder), if the Preferred
Securities remain in the form of one or more Global Certificates and if the
Depositary has sent an omnibus proxy to the Depositary Participants to whose
accounts the Preferred Securities are credited on the record date, the term
"Holders" shall mean such Depositary Participants acting at the direction of the
Beneficial Owners.

     "Indemnified Person" shall mean any Trustee, any Affiliate of any Trustee,
any Paying Agent, any officers, directors, shareholders, members, partners,
employees, representatives or agents of any Trustee, Affiliate of a Trustee or
Paying Agent, or any officer, employee or agent of the Trust or any of its
Affiliates.

     "Indenture" shall mean the indenture dated as of ____________________,
2003, between the [Subordinated] Notes Issuer and the Indenture Trustee
(including the provisions of the Trust Indenture Act that are deemed
incorporated therein), as supplemented or amended from time to time, pursuant to
which the [Subordinated] Notes are to be issued.

     "Indenture Event of Default" shall have the meaning given to the term
"Event of Default" in the Indenture.

     "Indenture Trustee" shall mean [             ], in its capacity as trustee
under the Indenture, until a successor is appointed thereunder, and thereafter
shall mean such successor trustee.

     "Investment Company" shall mean an investment company as defined in the
Investment Company Act and the regulations promulgated thereunder.

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

     "Legal Action" shall have the meaning specified in Section 3.06(f).

     "Liquidation" shall have the meaning specified in Section 8.02(a).

     "Liquidation Distribution" shall have the meaning specified in Section
8.02(d).

     "List of Holders" shall have the meaning specified in Section 2.02(a).

     "Majority in Liquidation Amount" shall mean, except as provided by the
Trust Indenture Act, Holders of outstanding Securities, voting together as a
single class, or, as the context may require, Holders of outstanding Preferred
Securities or Holders of the outstanding Common Securities, voting separately as
a class, who are the record owners of more than 50% of the aggregate liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accumulated and unpaid Distributions to the date
upon which the voting percentages are determined) of all outstanding Securities,
Preferred Securities or Common Securities, as the case may be.

     "Maturity Date" shall mean ____________________.

                                        6


     "Moody's" shall mean Moody's Investors Service, Inc.

     "New York Stock Exchange" shall mean the New York Stock Exchange, Inc. or
any successor thereto.

     "Officers' Certificate" shall mean, when delivered by the Trust, a
certificate signed by a majority of the Regular Trustees of the Trust and, when
delivered by the Sponsor, a certificate signed by (A) the Chairman of the Board,
President or a Vice President of the Sponsor and (B) the Treasurer, Assistant
Treasurer or Secretary of the Sponsor. Any Officers' Certificate delivered with
respect to compliance with a condition or covenant provided for in this
Declaration shall include, where applicable:

             (i)  a statement that each officer signing the Officers'
     Certificate has read the covenant or condition and the definitions relating
     thereto;

            (ii)  a brief statement of the nature and scope of the examination
     or investigation undertaken by each officer in rendering the Officers'
     Certificate;

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

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

     ["Option Closing Date" shall mean the date of closing of any sale of
Preferred Securities issued pursuant to an over-allotment option granted to the
underwriters named in the Underwriting Agreement.]

     "Paying Agent" shall have the meaning specified in Section 7.07.

     "Payment Amount" shall have the meaning specified in Section 7.02(c).

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

     "Pledge Agreement" shall mean the Pledge Agreement dated as of ___________,
2003 among Cinergy Corp., the Collateral Agent, [          ], as Securities
Intermediary, and the Purchase Contract Agent.

     "Preferred Securities" shall have the meaning specified in Section 7.01(a).

     "Preferred Security Certificate" shall mean a definitive certificate in
fully registered form representing a Preferred Security, substantially in the
form of Exhibit A, with such changes and

                                        7


additions thereto or deletions therefrom as may be required by ordinary usage,
custom or practice.

     "Primary Treasury Dealer" shall mean a primary U.S. government securities
dealer in New York City.

     "Property Account" shall have the meaning specified in Section 3.08(c).

     "Property Trustee" shall mean the Trustee meeting the eligibility
requirements set forth in Section 6.03.

     "Pro Rata" shall mean pro rata to each Holder according to the aggregate
liquidation amount of the Securities held by such Holder in relation to the
aggregate liquidation amount of all Securities outstanding.

     "Purchase Contract" shall have the meaning specified in the Purchase
Contract Agreement.

     "Purchase Contract Agent" shall mean [                      ].

     "Purchase Contract Agreement" shall mean the Purchase Contract Agreement
dated as of ____________, 2003 between Cinergy Corp., and [               ], as
Purchase Contract Agent.

     "Purchase Contract Settlement Date" shall mean _____________.

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

     "Quotation Agent" shall mean (A) _______________ and any respective
successor, provided that if _______________ or any respective successor ceases
to be a Primary Treasury Dealer, the Sponsor shall substitute another Primary
Treasury Dealer therefor or (B) any other Primary Treasury Dealer selected by
the Sponsor.

     "Redemption Amount" shall mean, for each [Subordinated] Note, the product
of the principal amount of such [Subordinated] Note and a fraction, the
numerator of which shall be the Treasury Portfolio Purchase Price and the
denominator of which shall be the Applicable Principal Amount.

     "Redemption/Distribution Notice" shall have the meaning specified in
Section 7.04(a).

     "Redemption Price" shall mean the amount for which the Securities will be
redeemed, which amount will equal the lesser of (i) the redemption price paid by
the [Subordinated] Notes Issuer to repay or redeem, in whole or in part, the
[Subordinated] Notes held by the Trust plus an amount equal to accumulated and
unpaid Distributions on such Securities through the date of their redemption or
(ii) the amount received by the Trust in respect of the [Subordinated] Notes so
repaid or redeemed.

                                        8


     "Remarketed Securities" shall mean (i) so long as the Trust has not been
dissolved, the Preferred Securities or (ii) if the Trust has been dissolved, the
[Subordinated] Notes.

     "Remarketing" shall mean the operation of the procedures for remarketing
specified in Section 7.13.

     "Remarketing Agent" shall mean ____________ or if the Remarketing Agent is
removed or resigns, any successor remarketing agent selected by the Sponsor.

     "Remarketing Agreement" shall mean the Remarketing Agreement dated as of
____________, 2003 among Cinergy Corp., the Trust and the Remarketing Agent.

     "Remarketing Date" shall mean the third Business Day preceding [         ].

     "Remarketing Settlement Date" shall mean the date, if any, on which the
settlement of the Remarketed Securities has occurred through the normal
settlement procedures in effect at such time of the Depositary or any successor
Depositary.

     "Reset Rate" shall mean the distribution rate per annum, as determined by
the Remarketing Agent, that results from the Remarketing pursuant to Section
7.13.

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

     "Rule 3a-7" shall mean Rule 3a-7 under the Investment Company Act or any
successor rule thereunder.

     "S&P" shall mean Standard & Poor's Ratings Services.

     "Scheduled Remarketing Settlement Date" shall mean the date, if any, on
which the settlement of the Remarketed Securities is scheduled to occur.

     "Securities" shall mean the Common Securities and the Preferred Securities.

     "Securities Act" shall mean the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time, and the rules and
regulations promulgated thereunder.

     "Securities Act Registration Statement" shall have the meaning specified in
Section 4.01(a).

     "Security Registrar" shall have the meaning specified in Section
7.09(a)(iii).

     "66 2/3% in Liquidation Amount" shall mean Holders of outstanding
Securities, voting together as a single class, or, as the context may require,
Holders of outstanding Preferred Securities voting separately as a class, who
are the record owners of 66 2/3% or more of the

                                        9


aggregate liquidation amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accumulated and unpaid Distributions
to the date upon which the voting percentages are determined) of all outstanding
Securities or Preferred Securities, as the case may be.

     "Sponsor" shall mean Cinergy Corp., a Delaware corporation, or any
successor entity in a merger, consolidation, or conveyance, transfer or lease of
its properties and assets substantially as an entirety, in its capacity as
sponsor of the Trust.

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

     "Stock Purchase Units" shall mean a security consisting of a unit comprised
of (A) a purchase contract under which the holder of the unit will purchase from
Cinergy Corp., for $25 in cash, a certain number of shares of common stock,
without par value, of Cinergy Corp., and (B) beneficial ownership of a Preferred
Security or [Subordinated] Note, or in certain circumstances following the
occurrence of a Tax Event, the appropriate Applicable Ownership Interest of the
Treasury Portfolio.

     "[Subordinated] Note Purchase Agreement" shall mean the [Subordinated] Note
Purchase Agreement dated as of ___________, 2003 between the [Subordinated]
Notes Issuer and the Trust.

     "[Subordinated] Notes" shall mean the series of [Subordinated] notes to be
issued by the [Subordinated] Notes Issuer under the Indenture and to be
purchased by the Trust and held by the Property Trustee.

     "[Subordinated] Notes Issuer" shall mean Cinergy Corp., a Delaware
corporation, or any successor entity in a merger, consolidation, or conveyance,
transfer or lease of its properties and assets substantially as an entirety, in
its capacity as issuer of the [Subordinated] Notes under the Indenture.

     "Successor Delaware Trustee" shall have the meaning specified in Section
6.06(b).

     "Successor Entity" shall have the meaning specified in Section 3.15(b)(i).

     "Successor Property Trustee" shall have the meaning specified in Section
6.06(b).

     "Successor Security" shall have the meaning specified in Section
3.15(b)(i)(B).

     "Supermajority" shall have the meaning specified in Section 7.05(j)(ii).

     "Tax Event" shall mean the receipt by the Sponsor and the Trust of an
opinion of counsel, rendered by a law firm having a recognized national tax
practice, to the effect that, as a result of any amendment to, change in or
announced proposed change in the laws (or any regulations thereunder) of the
United States or any political subdivision or taxing authority thereof or
therein, or as a result of any official administrative decision, pronouncement,
judicial decision or action interpreting or applying such laws or regulations,
which amendment or change

                                       10


is effective or which proposed change, pronouncement, action or decision is
announced on or after the Closing Date, there is more than an insubstantial
increase in the risk that (i) the Trust is, or within 90 days of the date of
such opinion will be, subject to United States federal income tax with respect
to income received or accrued on the [Subordinated] Notes, (ii) interest payable
by the [Subordinated] Notes Issuer on the [Subordinated] Notes is not, or within
90 days of the date of such opinion will not be, deductible by the
[Subordinated] Notes Issuer, in whole or in part, for United States federal
income tax purposes, or (iii) the Trust is, or within 90 days of the date of
such opinion will be, subject to more than a de minimis amount of other taxes,
duties or other governmental charges.

     "Tax Event Redemption" shall mean that a Tax Event has occurred and is
continuing and the [Subordinated] Notes have been called for redemption pursuant
to the Indenture.

     "Tax Event Redemption Date" shall mean the date of the Tax Event
Redemption, if any, specified by the [Subordinated] Notes Issuer.

     "10% in Liquidation Amount" shall mean, except as provided by the Trust
Indenture Act, Holder(s) of outstanding Securities, voting together as a single
class, or, as the context may require, Holders of outstanding Preferred
Securities or Holders of outstanding Common Securities, voting separately as a
class, who are the record owners of 10% or more of the aggregate liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accumulated and unpaid Distributions to the date
upon which the voting percentages are determined) of all outstanding Securities,
Preferred Securities or Common Securities, as the case may be.

     "Termination Event" shall have the meaning set forth in Section 1.01 of the
Purchase Contract Agreement.

     "Treasury Stock Purchase Units" shall mean a Stock Purchase Units with
respect to which Treasury Securities have been substituted for the Preferred
Securities or Applicable Ownership Interest of the Treasury Portfolio component,
as applicable.

     "Treasury Portfolio" shall mean, with respect to the Applicable Principal
Amount of [Subordinated] Notes, (A) if the Tax Event Redemption Date occurs
prior to the Purchase Contract Settlement Date, a portfolio of zero-coupon U.S.
treasury securities consisting of (i) principal or interest strips of U.S.
treasury securities that mature on or prior to the Purchase Contract Settlement
Date in an aggregate amount at maturity equal to the Applicable Principal Amount
and (ii) with respect to each scheduled interest payment date on the
[Subordinated] Notes that occurs after the Tax Event Redemption Date but on or
prior to the Purchase Contract Settlement Date, principal or interest strips of
U.S. treasury securities that mature on or prior to such date in an aggregate
amount at maturity equal to the aggregate interest payment that would have been
due on the Applicable Principal Amount of the [Subordinated] Notes on such date,
and (B) if the Tax Event Redemption Date occurs on or after the Purchase
Contract Settlement Date, a portfolio of zero-coupon U.S. treasury securities
consisting of (i) principal or interest strips of U.S. treasury securities that
mature on or prior to the Maturity Date in an aggregate amount at maturity equal
to the Applicable Principal Amount and (ii) with respect to each scheduled
interest payment date on the [Subordinated] Notes that occurs after the Tax
Event

                                       11


Redemption Date, principal or interest strips of U.S. treasury securities that
mature on or prior to such date in an aggregate amount at maturity equal to the
aggregate interest payment that would have been due on the Applicable Principal
Amount of the [Subordinated] Notes on such date.

     "Treasury Portfolio Purchase Price" shall mean the lowest aggregate price
quoted by a Primary Treasury Dealer to the Quotation Agent on the third Business
Day preceding the Tax Event Redemption Date for the purchase of the Treasury
Portfolio for settlement on the Tax Event Redemption Date.

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

     "Treasury Securities" shall mean zero-coupon U.S. Treasury Securities
(CUSIP Number ___________) with a principal amount at maturity equal to $1,000
and maturing on ___________, the Business Day preceding the Purchase Contract
Settlement Date.

     "Trust Enforcement Event" in respect of the Securities shall mean that an
Indenture Event of Default has occurred and is continuing.

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

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

     "Two-Year Benchmark Treasury Rate" shall mean the bid side rate displayed
at 10:00 a.m., New York City time, on the third Business Day immediately
preceding the Purchase Contract Settlement Date for direct obligations of the
United States (which may be obligations traded on a when-issued basis only)
having a maturity comparable to the remaining term to maturity of the
[Subordinated] Notes, as agreed upon by the [Subordinated] Notes Issuer and the
Remarketing Agent in the Telerate system (or if the Telerate system is (a) no
longer available on the third Business Day immediately preceding the Purchase
Contract Settlement Date or (b) in the opinion of the Remarketing Agent (after
consultation with the [Subordinated] Notes Issuer) no longer an appropriate
system from which to obtain such rate, such other nationally recognized
quotation system as, in the opinion of the Remarketing Agent (after consultation
with the [Subordinated] Notes Issuer) is appropriate.

     "United States Person" shall mean a United States person for United States
federal income tax purposes.

     "Underwriting Agreement" shall mean the Underwriting Agreement dated as of
___________, 2003, among the Trust, the Sponsor and _____________, as
representatives of the several underwriters named therein.

                                       12


                                    ARTICLE 2
                               TRUST INDENTURE ACT

     Section 2.01. TRUST INDENTURE ACT; APPLICATION.

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

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

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

     (d)  The application of the Trust Indenture Act to this Declaration shall
not affect the Trust's classification as a grantor trust for United States
federal income tax purposes and shall not affect the nature of the Securities as
equity securities representing undivided beneficial interests in the assets of
the Trust.

     Section 2.02. LIST OF HOLDERS OF THE SECURITIES.

     (a)  Each of the Sponsor and the Administrative Trustees on behalf of the
Trust shall provide the Property Trustee with a list of the names and addresses
of the Holders of the Securities in such form as the Property Trustee may
reasonably require ("List of Holders") (i) as of the record date relating to the
payment of any Distribution, at least one Business Day prior to the date for
payment of such Distribution, except while the Preferred Securities are
represented by one or more Global Certificates, and (ii) at any other time,
within 30 days of receipt by the Trust of a written request from the Property
Trustee for a List of Holders as of a date no more than 15 days before such List
of Holders is provided to the Property Trustee. If at any time the List of
Holders does not differ from the most recent List of Holders provided to the
Property Trustee by the Sponsor and the Administrative Trustees on behalf of the
Trust, then neither the Sponsor nor the Administrative Trustees shall be
obligated to deliver such List of Holders. The Property Trustee shall preserve,
in as current a form as is reasonably practicable, all information contained in
Lists of Holders provided to it or that it receives in its capacity as Paying
Agent (if acting in such capacity); PROVIDED that the Property Trustee may
destroy any List of Holders previously provided to it on receipt of a new List
of Holders.

     (b)  The Property Trustee shall comply with its obligations under, and
shall be entitled to the benefits of, Sections 311(a), 311(b) and 312(b) of the
Trust Indenture Act.

     Section 2.03. REPORTS BY THE PROPERTY TRUSTEE.

     Within 60 days after __________ of each year (commencing with the year of
the first anniversary of the issuance of the Preferred Securities), the Property
Trustee shall provide to the Holders of the Preferred Securities such reports as
are required by Section 313 of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust

                                       13


Indenture Act. The Property Trustee also shall comply with the requirements of
Section 313(d) of the Trust Indenture Act. The Sponsor shall promptly notify the
Property Trustee when any Preferred Securities are listed for trading on any
stock exchange and of any delisting thereof.

     Section 2.04. PERIODIC REPORTS TO THE PROPERTY TRUSTEE.

     Each of the Sponsor and the Administrative Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and the compliance
certificate required by Section 314 of the Trust Indenture Act in the form, in
the manner and at the times required by Section 314 of the Trust Indenture Act.
Compliance certificates required by Section 314(a)(4) of the Trust Indenture Act
shall be delivered to the Property Trustee annually on or before 120 days after
the end of each fiscal year of the Sponsor.

     Section 2.05. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.

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

                                    ARTICLE 3
                                  ORGANIZATION

     Section 3.01. NAME AND ORGANIZATION.

     The Trust hereby continued is named "CC Funding Trust II," as such name may
be modified from time to time by the Administrative Trustees following written
notice to the Holders of the Securities. The Trust's activities may be conducted
under the name of the Trust or any other name deemed advisable by the
Administrative Trustees.

     Section 3.02. OFFICE.

     The address of the principal office of the Trust is 139 East Fourth Street,
Cincinnati, OH 45202. On ten Business Days' written notice to the Holders of the
Securities, the Administrative Trustees may designate another principal office.

     Section 3.03. PURPOSE.

     The exclusive purposes and functions of the Trust are (a) to issue, sell
and repurchase the Securities, (b) to use the gross proceeds from such sale to
acquire the [Subordinated] Notes, (c) to enter into the Underwriting Agreement,
the Remarketing Agreement, the Common Securities Purchase Agreement and the
[Subordinated] Note Purchase Agreement and (d) except as otherwise limited
herein, to engage in only those other activities necessary or incidental
thereto. The Trust shall not borrow money, issue debt, reinvest proceeds derived
from investments, pledge any of its assets or otherwise undertake (or permit to
be undertaken) any activity that

                                       14


would cause the Trust not to be classified as a grantor trust for United States
federal income tax purposes.

     By the acceptance of this Trust, none of the Trustees, the Sponsor, the
Holders of the Preferred Securities or the Common Securities or the Beneficial
Owners of the Preferred Securities will take any position that is contrary to
the classification of the Trust as a grantor trust for United State federal
income tax purposes.

     Section 3.04. AUTHORITY.

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

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

     (c)  Unless otherwise determined by the Administrative Trustees, and except
as otherwise required by the Statutory Trust Act or applicable law, any
Administrative Trustee may delegate to any other natural person over the age of
21 that is a United States Person, by power of attorney consistent with
applicable law, his or her power for the purposes of signing any documents that
the Administrative Trustees have power and authority to cause the Trust to
execute pursuant to Section 3.06.

     Section 3.05. TITLE TO PROPERTY OF THE TRUST.

     Except as provided in Section 3.08 with respect to the [Subordinated] Notes
and the Property Account or as otherwise provided in this Declaration, legal
title to all assets of the Trust shall be vested in the Trust. The Holders of
the Securities shall not have legal title to any part of the assets of the Trust
but shall have undivided beneficial interests in the assets of the Trust.

     Section 3.06. POWERS AND DUTIES OF THE ADMINISTRATIVE TRUSTEES.

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

     (a)  to issue and sell the Securities in accordance with this Declaration;
PROVIDED that the Trust may issue no more than one series of Preferred
Securities and no more than one series of Common Securities; and PROVIDED
FURTHER that there shall be no interests in the Trust other

                                       15


than the Securities, and the issuance of the Securities shall be limited to a
one-time, simultaneous issuance of both Preferred Securities and Common
Securities on the Closing Date [and the Option Closing Date, if any];

     (b)  to acquire the [Subordinated] Notes with the proceeds of the sale of
the Securities; PROVIDED that the Administrative Trustees shall cause legal
title to the [Subordinated] Notes to be held of record in the name of the
Property Trustee for the benefit of the Holders of the Securities;

     (c)  to give the Sponsor and the Property Trustee prompt written notice of
the occurrence of a Tax Event; PROVIDED that the Administrative Trustees shall
consult with the Sponsor and the Property Trustee before taking or refraining
from taking any action in relation to any such Tax Event;

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

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

     (f)  to bring or defend, pay, collect, compromise, arbitrate, resort to
legal action or otherwise adjust claims or demands of or against the Trust
("Legal Action"), unless pursuant to Section 3.08(e), the Property Trustee has
the exclusive power to bring such Legal Action;

     (g)  to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors and
consultants to conduct only those services that the Administrative Trustees have
authority to conduct directly, and to pay reasonable compensation for such
services, PROVIDED that any Person so employed or engaged is a United States
Person;

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

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

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

     (k)  to act as, or appoint another Person to act as, registrar and transfer
agent for the Securities;

     (l)  to take all action that may be necessary or appropriate for the
preservation and continuation of the Trust's valid existence, rights, franchise
and privileges as a statutory trust under the laws of the State of Delaware and
of each other jurisdiction in which such existence is

                                       16


necessary to protect the limited liability of the Holders of the Securities or
to enable the Trust to effect the purposes for which it was created;

     (m)  to take any action not inconsistent with applicable law that the
Administrative Trustees determine in their discretion to be necessary or
desirable in carrying out the purposes and functions of the Trust as set forth
in Section 3.01 or the activities of the Trust as set forth in this Section
3.06, including:

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

            (ii)  causing the Trust to be classified as a grantor trust for
     United States federal income tax purposes; and

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

     (n)  to take all action necessary to cause all applicable tax returns and
tax information reports that are required to be filed with respect to the Trust
to be duly prepared and filed;

     (o)  to prepare, execute and file a certificate of cancellation of the
Certificate of Trust of the Trust pursuant to Section 8.01(b);

     (p)  if and to the extent that the Sponsor on behalf of the Trust has not
already done so, to cause the Trust to enter into the Underwriting Agreement
and/or such other agreements and arrangements as may be necessary or desirable
in connection with the sale of the Preferred Securities to the initial
purchasers thereof and the consummation thereof, and to take all action, and
exercise all discretion, as may be necessary or desirable in connection with the
consummation thereof; and

     (q)  to execute all documents or instruments, including, without
limitation, the Underwriting Agreement, the Remarketing Agreement, the Common
Securities Purchase Agreement and the [Subordinated] Note Purchase Agreement,
perform all duties and powers, and do all things for and on behalf of the Trust
in all matters necessary or incidental to the foregoing.

     The Administrative Trustees shall exercise the powers set forth in this
Section 3.06 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.03, and the Administrative Trustees shall have no
power to, and shall not, take any action that is inconsistent with the purposes
and functions of the Trust set forth in Section 3.03.

     Subject to this Section 3.06, the Administrative Trustees shall have none
of the powers or the authority of the Property Trustee set forth in Section
3.08.

     Any expenses incurred by the Administrative Trustees pursuant to this
Section 3.06 shall be reimbursed by the [Subordinated] Notes Issuer.

                                       17


     Section 3.07. PROHIBITION OF ACTIONS BY THE TRUST AND THE TRUSTEES.

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

             (i)  invest any proceeds received by the Trust in connection with
     its ownership of the [Subordinated] Notes, but the Property Trustee shall
     distribute all such proceeds to the Holders of the Securities pursuant to
     the terms of this Declaration and of the Securities;

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

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

            (iv)  make any loans or incur any indebtedness;

             (v)  possess any power or otherwise act in such a way as to vary
     the Trust's assets;

            (vi)  possess any power or otherwise act in such a way as to vary
     the terms of the Securities in any way whatsoever (except to the extent
     expressly authorized in this Declaration or by the terms of the
     Securities);

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

          (viii)  other than as provided in this Declaration, (A) direct the
     time, method and place of exercising any trust or power conferred upon the
     Indenture Trustee with respect to the [Subordinated] Notes, (B) waive any
     past default that is waivable under the Indenture, (C) exercise a right to
     rescind or annul any declaration that the principal of all the
     [Subordinated] Notes shall be due and payable or (D) consent to any
     amendment, modification or termination of the Indenture or the
     [Subordinated] Notes where such consent is required, unless the Trust has
     received an opinion of counsel to the effect that such modification will
     not cause more than an insubstantial increase in the risk that the Trust
     will not be classified as a grantor trust for United States federal income
     tax purposes;

            (ix)  take any action inconsistent with the status of the Trust as
     grantor trust for United States federal income tax purposes;

             (x)  revoke any action previously authorized or approved by vote of
     the Holders of the Preferred Securities; or

                                       18


            (xi)  after the date hereof, enter into any contract or agreement
     (other than any depositary agreement or any agreement with any securities
     exchange or automated quotation system) that does not expressly provide
     that the Holders of Preferred Securities, in their capacities as such, have
     limited liability for the liabilities and obligations of the Trust, which
     express provision shall be in substantially the following form:

          The Holders of the Preferred Securities, in their capacities
          as such, shall not be personally liable for any liabilities
          or obligations of the Trust arising out of this Agreement,
          and the parties hereto hereby agree that the Holders of the
          Preferred Securities, in their capacities as such, shall be
          entitled to the same limitation of personal liability
          extended to stockholders of private corporations for profit
          organized under the General Corporation Law of the State of
          Delaware.

     Section 3.08. POWERS AND DUTIES OF THE PROPERTY TRUSTEE.

     (a)  The legal title to the [Subordinated] Notes shall be owned by and held
of record in the name of the Property Trustee in trust for the benefit of the
Trust and the Holders of the Securities. The right, title and interest of the
Property Trustee to the [Subordinated] Notes shall vest automatically in each
Person that hereafter may be appointed as Property Trustee in accordance with
Section 6.06. To the fullest extent permitted by law, such vesting and cessation
of title shall be effective whether or not conveyancing documents with regard to
the [Subordinated] Notes have been executed and delivered.

     (b)  The Property Trustee shall not transfer its right, title and interest
in the [Subordinated] Notes to the Administrative Trustees nor to the Delaware
Trustee (if the Property Trustee does not also act as Delaware Trustee).

     (c)  The Property Trustee shall:

             (i)  establish and maintain a segregated non-interest bearing trust
     account (the "Property Account") in the name of and under the exclusive
     control of the Property Trustee on behalf of the Holders of the Securities
     and, upon the receipt of payments of funds made in respect of the
     [Subordinated] Notes, deposit such funds into the Property Account and make
     payments to the Holders of the Securities from the Property Account in
     accordance with Section 7.02. Funds in the Property Account shall be held
     uninvested until disbursed in accordance with this Declaration. The
     Property Account shall be an account that is maintained with a banking
     institution, the rating on whose long-term unsecured indebtedness is at
     least equal to the rating assigned to the [Subordinated] Notes Issuer's
     senior notes by a "nationally recognized statistical rating organization"
     within the meaning of Rule 436(g)(2) under the Securities Act;

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

                                       19


           (iii)  upon written direction by the Sponsor to dissolve the Trust,
     to engage in such ministerial activities as shall be necessary or
     appropriate to effect the distribution of the [Subordinated] Notes to the
     Holders of the Securities in exchange for the Securities.

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

     (e)  The Property Trustee shall take any Legal Action that arises out of or
in connection with (i) a Trust Enforcement Event of which a Responsible Officer
of the Property Trustee has actual knowledge or (ii) the Property Trustee's
duties and obligations under this Declaration or the Trust Indenture Act;
PROVIDED that if a Trust Enforcement Event has occurred and is continuing and
such event is attributable to the failure of the [Subordinated] Notes Issuer to
pay interest or principal on the [Subordinated] Notes on the date such interest
or principal is otherwise payable (or in the case of redemption, on the
redemption date), then a Holder of Preferred Securities may institute a
proceeding directly against the [Subordinated] Notes Issuer to enforce payment
to such Holder of the principal or interest on [Subordinated] Notes having an
aggregate principal amount equal to the aggregate liquidation amount of the
Preferred Securities of such Holder (a "Direct Action"). In connection with such
Direct Action, the [Subordinated] Notes Issuer will be subrogated to the rights
of such Holder of Preferred Securities to the extent of any payment made by the
[Subordinated] Notes Issuer to such Holders of Preferred Securities in such
Direct Action.

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

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

            (ii)  a Successor Property Trustee has been appointed and has
     accepted that appointment in accordance with Section 6.06.

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

     (h)  Subject to this Section 3.08, the Property Trustee shall have none of
the duties, liabilities, powers or the authority of the Administrative Trustees
set forth in Section 3.06.

     The Property Trustee shall exercise the powers set forth in this Section
3.08 in a manner that is consistent with the purposes and functions of the Trust
set out in Section 3.03, and the Property Trustee shall have no power to, and
shall not, take any action that is inconsistent with the purposes and functions
of the Trust set out in Section 3.03.

                                       20


     Section 3.09. CERTAIN DUTIES AND RESPONSIBILITIES OF THE PROPERTY TRUSTEE.

     (a)  Within 90 days after the occurrence of a Trust Enforcement Event
actually known to a Responsible Officer of the Property Trustee, the Property
Trustee shall transmit by mail, first class postage prepaid, to the Holders of
the Securities, notice of such Trust Enforcement Event, unless such Trust
Enforcement Event has been cured before the giving of such notice; PROVIDED
that, except for a default in the payment of principal of (or premium, if any)
or interest on any of the [Subordinated] Notes, the Property Trustee shall be
protected in withholding such notice if and so long as a Responsible Officer of
the Property Trustee in good faith determines that the withholding of such
notice is in the interests of the Holders of the Securities.

     (b)  The Property Trustee shall not be deemed to have knowledge of any
Trust Enforcement Event except for:

             (i)  a default under Section 501(1) and (2) of the Indenture; or

            (ii)  any default as to which the Property Trustee shall have
     received written notice or of which a Responsible Officer of the Property
     Trustee charged with the administration of this Declaration shall have
     actual knowledge.

     (c)  If a Trust Enforcement Event has occurred (that has not been cured or
waived pursuant to Section 7.05) of which a Responsible Officer of the Property
Trustee has actual knowledge, the Property Trustee shall exercise such of the
rights and powers vested in it by this Declaration and shall use the same degree
of care and skill in its exercise as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs.

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

             (i)  prior to the occurrence of a Trust Enforcement Event and after
     the cure or waiver of all such Trust Enforcement Events that may have
     occurred:

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

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

                                       21


             Declaration (but need not confirm or investigate the accuracy of
             mathematical calculations or other facts stated therein);

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

           (iii)  the Property Trustee shall not be liable with respect to any
     action taken or omitted to be taken by it without negligence, in good faith
     in accordance with the direction of the Holders of not less than a Majority
     in Liquidation Amount of the Securities relating to the time, method and
     place of conducting any proceeding for any remedy available to the Property
     Trustee, or exercising any trust or power conferred upon the Property
     Trustee under this Declaration;

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

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

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

           (vii)  the Property Trustee shall not be liable for any interest on
     any money received by it except as it otherwise may agree in writing with
     the Sponsor. Money held by the Property Trustee need not be segregated from
     other funds held by it except in relation to the Property Account
     maintained by the Property Trustee pursuant to Section 3.08(c)(i) and
     except to the extent otherwise required by law; and

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

                                       22


     Section 3.10.  CERTAIN RIGHTS OF PROPERTY TRUSTEE.

     (a)  Subject to the provisions of Section 3.09:

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

            (ii)  Any direction or act of the Sponsor contemplated by this
     Declaration shall be sufficiently evidenced by an Officers' Certificate.

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

            (iv)  The Property Trustee shall have no duty to see to any
     recording, filing or registration of any instrument (including any
     financing or continuation statement or any filing under tax or securities
     laws) or any rerecording, refiling or registration thereof.

             (v)  The Property Trustee may consult with counsel of its choice or
     other experts, and the advice or opinion of such counsel and experts with
     respect to legal matters or advice within the scope of such experts' area
     of expertise shall be full and complete authorization and protection in
     respect of any action taken, suffered or omitted by it hereunder in good
     faith and in accordance with such advice or opinion. Such counsel may be
     counsel to the Sponsor or any of its Affiliates and may include any of its
     employees. The Property Trustee shall have the right at any time to seek
     instructions concerning the administration of this Declaration from any
     court of competent jurisdiction.

            (vi)  The Property Trustee shall be under no obligation to exercise
     any of the rights or powers vested in it by this Declaration at the request
     or direction of any Holder of Securities, unless such Holder of Securities
     has provided to the Property Trustee security and indemnity, reasonably
     satisfactory to the Property Trustee, against the costs, expenses
     (including attorneys' fees and expenses and the expenses of the Property
     Trustee's agents, nominees or custodians) and liabilities that might be
     incurred by it in complying with such request or direction, including such
     reasonable advances as may be requested by the Property Trustee; PROVIDED
     that nothing contained in this Section 3.10(a) shall be taken to relieve
     the Property Trustee, upon the occurrence of an Indenture Event of Default,
     of its obligation to exercise the rights and powers vested in it by this
     Declaration.

                                       23


           (vii)  The Property Trustee shall not be bound to make any
     investigation into the facts or matters stated in any resolution,
     certificate, statement, instrument, opinion, report, notice, request,
     direction, consent, order, bond, debenture, note, other evidence of
     indebtedness or other paper or document, but the Property Trustee, in its
     discretion, may make such further inquiry or investigation into such facts
     or matters as it sees fit, and, if the Property Trustee shall determine to
     make such further inquiry or investigation, it shall be entitled to examine
     the books, records and premises of the Sponsor, personally or by agent or
     attorney at the sole cost of the Sponsor and shall incur no liability or
     additional liability of any kind by reason of such inquiry or
     investigation.

          (viii)  The Property Trustee may execute any of the trusts or powers
     hereunder or perform any duties hereunder either directly or by or through
     agents, custodians, nominees or attorneys; PROVIDED that any such action
     (other than ministerial action) executed or performed by such agent or
     attorney is executed or performed by an agent or an attorney that is a
     United States Person, and the Property Trustee shall not be responsible for
     any misconduct or negligence on the part of any agent or attorney appointed
     with due care by it hereunder.

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

             (x)  Whenever in the administration of this Declaration the
     Property Trustee shall deem it desirable to receive instructions with
     respect to enforcing any remedy or right or taking any other action
     hereunder, the Property Trustee (A) may request instructions from the
     Holders of the Securities, which instructions only may be given by the
     Holders of the same proportion in liquidation amount of the Securities as
     would be entitled to direct the Property Trustee under this Declaration in
     respect of such remedy, right or action, (B) may refrain from enforcing
     such remedy or right or taking such other action until such instructions
     are received and (C) shall be protected in conclusively relying on or
     acting in accordance with such instructions.

            (xi)  Except as otherwise expressly provided by this Declaration,
     the Property Trustee shall not be under any obligation to take any action
     that is discretionary under the provisions of this Declaration.

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

                                       24


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

     Section 3.11.  DELAWARE TRUSTEE.

     Notwithstanding any other provision of this Declaration other than Section
6.02, the Delaware Trustee shall not be entitled to exercise any powers of, nor
shall the Delaware Trustee have any of the duties and responsibilities of, the
Trustees described in this Declaration. Except as set forth in Section 6.02, the
Delaware Trustee shall be a Trustee for the sole and limited purpose of
fulfilling the requirements of Section 3807(a) of the Statutory Trust Act. If
the Property Trustee, meeting the requirements of Section 6.02, also acts as
Delaware Trustee, this Section 3.11 shall not apply.

     Section 3.12.  INTENTIONALLY OMITTED.

     Section 3.13.  NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.

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

     Section 3.14.  DURATION OF TRUST.

     The Trust shall exist until dissolved pursuant to the provisions of Article
8 hereof.

     Section 3.15.  MERGERS.

     (a)  The Trust may not consolidate with, convert into, amalgamate or merge
with or into, be replaced by or convey, transfer or lease its properties and
assets substantially as an entirety to any corporation or other body, except as
described in Section 3.15(b) and (c) or Section 8.02.

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

             (i)  if the Trust is not the successor entity, such successor
     entity (the "Successor Entity") either:

                                       25


                    (A) expressly assumes all of the obligations of the Trust
             with respect to the Securities; or

                    (B) substitutes for the Securities other securities having
             substantially the same terms as the Securities (the "Successor
             Securities"), so long as such Successor Securities rank the same as
             the Securities with respect to Distributions and payments upon
             liquidation, redemption and otherwise;

            (ii)  the [Subordinated] Notes Issuer expressly appoints a trustee
     of such Successor Entity that possesses the same powers and duties as the
     Property Trustee as the holder of the [Subordinated] Notes;

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

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

             (v)  such consolidation, conversion, amalgamation, merger,
     replacement, conveyance, transfer or lease does not adversely affect the
     rights, preferences and privileges of the Holders of the Preferred
     Securities (including any Successor Securities) in any material respect;

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

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

                    (A) such consolidation, conversion, amalgamation, merger,
             replacement, conveyance, transfer or lease does not adversely
             affect the rights, preferences and privileges of the Holders of the
             Securities (including any Successor Securities) in any material
             respect;

                    (B) following such consolidation, conversion, amalgamation,
             merger, replacement, conveyance, transfer or lease, neither the
             Trust nor such Successor Entity will be required to register as an
             Investment Company under the Investment Company Act; and

                    (C) following such consolidation, conversion, amalgamation
             or merger, replacement, conveyance, transfer or lease, the Trust
             (or such Successor Entity) will continue to be classified as a
             grantor trust for United States federal income tax purposes;

                                       26


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

            (ix)  such Successor Entity expressly assumes all of the obligations
     of the Trust.

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

     Section 3.16.  COMPENSATION AND REIMBURSEMENT.

     The Sponsor agrees to pay each of the Trustees from time to time such
compensation for all services rendered by such Trustee hereunder as the Sponsor
and such Trustee may agree upon from time to time (which compensation shall not
be limited by any provision of law in regard to the compensation of a trustee of
an express trust). To the fullest extent permitted by law the parties intend
that Section 3561 of Title 12 of the Delaware Code shall not apply to the Trust
and that compensation paid pursuant to this Section 3.16 not be subject to
review by any court under Section 3560 of Title 12 of the Delaware Code. The
provisions of this Section 3.16 shall survive the termination of this
Declaration.

     Section 3.17.  PROPERTY TRUSTEE MAY FILE PROOFS OF CLAIM.

     In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
similar judicial proceeding relative to the Trust or any other obligor upon the
Securities or the property of the Trust or of such other obligor or their
creditors, the Property Trustee (irrespective of whether any Distributions on
the Securities are then due and payable as therein expressed or by declaration
or otherwise and irrespective of whether the Property Trustee has made any
demand on the Trust for the payment of any past due Distributions) shall be
entitled and empowered, to the fullest extent permitted by law, by intervention
in such proceeding or otherwise:

     (a)  to file and prove a claim for the whole amount of any Distributions
owing and unpaid in respect of the Securities (or, if the Securities are
original issue discount securities, such portion of the liquidation amount as
may be specified in the terms of such securities) and to file such other papers
or documents as may be necessary or advisable in order to have the claims of the
Property Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Property Trustee, its agents and counsel) and
of the Holders of the Securities allowed in such judicial proceeding; and

                                       27


     (b)  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 of Securities to make such payments to the Property Trustee and, in
the event the Property Trustee consents to the making of such payments directly
to the Holders, to pay to the Property Trustee any amount due it for the
reasonable compensation, expenses, disbursements and advances of the Property
Trustee, its agents and counsel, and any other amounts due the Property Trustee.

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

     Section 3.18.  REGISTRATION STATEMENT AND RELATED MATTERS.

     In the event that any filing referred to in Section 4.01(a)-(d) is required
by the rules and regulations of the Commission, any Exchange, the National
Association of Securities Dealers, Inc. or state securities or blue sky laws, to
be executed on behalf of the Trust by the Administrative Trustees, the
Administrative Trustees, in their capacities as Trustees of the Trust, are
hereby authorized to join in any such filing and to execute on behalf of the
Trust any and all of the foregoing. In connection with all of the foregoing,
each Administrative Trustee, solely in its capacity as Trustee of the Trust, has
constituted and appointed, and hereby confirms the appointment of, Richard E.
Terry, James M. Luebbers and Peter Kauffman, and each of them, as his, her or
its, as the case may be, true and lawful attorneys-in-fact, and agents, with
full power of substitution and resubstitution, for such Trustee or in such
Trustee's name, place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to the Securities Act
Registration Statement and the Exchange Act Registration Statement and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Commission, granting unto said attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection therewith, as fully to all
intents and purposes as such Trustee 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 or her substitute or substitutes, may lawfully do or cause
to be done by virtue hereof. Notwithstanding anything in this Section 3.18 to
the contrary, no Foreign Person (acting in its capacity as attorney-in-fact or
agent of any Foreign Person) shall be authorized to take or perform any action
on behalf of the Trust pursuant to this Section 3.18 at any time on or after the
Closing Date.

     Section 3.19.  BOOKS AND RECORDS.

     The books and records of the Trust will be maintained at the principal
office of the Trust and will be open for inspection by each Holder of Preferred
Securities or any authorized representative of such Holder for any purpose
reasonably related to the Holder's interest in the Trust during normal business
hours.

                                       28


                                    ARTICLE 4
                                   THE SPONSOR

     Section 4.01.  RESPONSIBILITIES OF THE SPONSOR.

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

     (a)  to prepare, execute and file with the Commission, on behalf of the
Trust, a registration statement on Form S-3 in relation to the Preferred
Securities, including any amendments or supplements thereto and any registration
statement filed pursuant to Rule 462(b) under the Securities Act relating to the
Preferred Securities (the "Securities Act Registration Statement"), and to take
any other action relating to the registration and sale of the Preferred
Securities under federal and state securities laws;

     (b)  if necessary, to determine the states in which to take appropriate
action to qualify or register for sale all or part of the Stock Purchase Units
and to do any and all such acts, other than actions that must be taken by the
Trust, and advise the Trust of actions it must take; to prepare, execute and
file, on behalf of the Trust, any documents it deems necessary or advisable in
order to comply with the applicable laws of any such states; and to prepare,
execute and file, on behalf of the Trust, any such documents or take any acts
determined by it to be necessary in order to qualify or register all or part of
the Stock Purchase Units in any state in which it has determined to qualify or
register such Stock Purchase Units for sale;

     (c)  if necessary, to prepare, execute and file on behalf of the Trust, an
application to the [New York Stock Exchange] or any other national stock
exchange or the NASDAQ National Market for listing upon notice of issuance of
any Preferred Securities;

     (d)  if necessary, to prepare, execute and file with the Commission, on
behalf of the Trust, a registration statement on Form 8-A relating to the
registration of the Preferred Securities under Section 12 of the Exchange Act,
including any amendments thereto (the "Exchange Act Registration Statement");
and

     (e)  to negotiate the terms of, and execute and enter into, on behalf of
the Trust, an Underwriting Agreement providing for the sale of the Stock
Purchase Units and a Remarketing Agreement providing for the Remarketing.

                                    ARTICLE 5
                      THE HOLDERS OF THE COMMON SECURITIES

     Section 5.01.  [SUBORDINATED] NOTES ISSUER'S PURCHASE OF THE COMMON
SECURITIES.

     On the Closing Date, the [Subordinated] Notes Issuer shall purchase all of
the Common Securities issued by the Trust, in an aggregate liquidation amount
equal to at least three percent of the total capital of the Trust, at such time
as the Preferred Securities are sold and issued.

                                       29


     The aggregate stated liquidation amount of the Common Securities
outstanding at any time shall not be less than three percent of the total
capital of the Trust.

     Section 5.02.  COVENANTS OF THE [SUBORDINATED] NOTES ISSUER.

     For so long as the Preferred Securities remain outstanding, the
[Subordinated] Notes Issuer shall covenant (i) to maintain, directly or
indirectly, 100% ownership of the Common Securities, (ii) to cause the Trust to
remain a statutory trust and not to voluntarily dissolve, wind up, liquidate or
be terminated, except as permitted by this Declaration, (iii) to use its
commercially reasonable efforts to ensure that the Trust will not be an
Investment Company required to be registered under the Investment Company Act
and (iv) not to take any action that would create more than an insubstantial
risk that the Trust would be classified as an association or a publicly traded
partnership taxable as a corporation for United States federal income tax
purposes.

     Section 5.03.  HOLDER OF THE COMMON SECURITIES.

     Each Holder of the Common Securities shall at all times hold the Common
Securities in its individual capacity on its own behalf and shall not, in its
capacity as a Holder of the Common Securities, be under (or subject to) the
control or direction of any Foreign Person (pursuant to a contractual
arrangement or otherwise) other than by virtue of such Foreign Person's direct
or indirect stock ownership, if any, of the Holder of the Common Securities.
Notwithstanding anything in this Declaration to the contrary, each Holder of the
Common Securities shall at all times be a United States Person and shall be
authorized to give any direction hereunder with respect to the Trust as shall be
necessary for the Trust not to be considered a foreign trust for United States
federal income tax purposes.

     Section 5.04.  EXCHANGES.

     (a)  If at any time the [Subordinated] Notes Issuer or any of its
Affiliates (in either case, a "Issuer Affiliated Holder") is the Holder of any
Preferred Securities, such Issuer Affiliated Holder shall have the right to
deliver to the Property Trustee all or such portion of its Preferred Securities
as it elects and receive, in exchange therefor, [Subordinated] Notes in an
aggregate principal amount equal to the aggregate stated liquidation amount of,
with an interest rate identical to the distribution rate of, and accrued and
unpaid interest equal to accumulated and unpaid Distributions on, such Preferred
Securities. Such election (i) shall be exercisable effective on any Distribution
payment date by such Issuer Affiliated Holder delivering to the Property Trustee
a written notice of such election specifying the aggregate liquidation amount of
the Preferred Securities with respect to which such election is being made and
the Distribution payment date on which such exchange shall occur, which
Distribution payment date shall be not less than ten Business Days after the
date of receipt by the Property Trustee of such election notice and (ii) shall
be conditioned upon such Issuer Affiliated Holder having delivered or caused to
be delivered to the Property Trustee or its designee the Preferred Securities
which are the subject of such election by 10:00 a.m. New York City time, on the
Distribution payment date on which such exchange is to occur. After the
exchange, such Preferred Securities will be canceled and will no longer be
deemed to be outstanding and all rights of the [Subordinated] Notes Issuer or
its Affiliate(s) with respect to such Preferred Securities will cease.

                                       30


     (b)  In the case of an exchange described in Section 5.04(a), the Trust
will, on the date of such exchange, exchange [Subordinated] Notes having a
principal amount equal to a proportional amount of the aggregate liquidation
amount of the outstanding Common Securities based on the ratio of the aggregate
liquidation amount of the Preferred Securities exchanged pursuant to Section
5.04(a) divided by the aggregate liquidation amount of the Preferred Securities
outstanding immediately prior to such exchange, for such proportional amount of
Common Securities held by the [Subordinated] Notes Issuer (which
contemporaneously shall be canceled and no longer be deemed to be outstanding);
PROVIDED, that the [Subordinated] Notes Issuer delivers or causes to be
delivered to the Property Trustee or its designee the required amount of Common
Securities to be exchanged by 10:00 a.m., New York City time, on the
Distribution payment date on which such exchange is to occur.

                                    ARTICLE 6
                                  THE TRUSTEES

     Section 6.01.  NUMBER OF TRUSTEES.

     The number of Trustees initially shall be five, and:

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

     (b)  after the issuance of any Securities, the number of Trustees may be
increased or decreased by vote of the Holders of the Common Securities at a
meeting of the Holders of the Common Securities or by written consent without
prior notice in lieu of such meeting;

PROVIDED that the number of Trustees shall be at least three; and PROVIDED
FURTHER that: (i) the Delaware Trustee, in the case of a natural person, shall
be a person who is a resident of the State of Delaware or that, if not a natural
person, is an entity that has its principal place of business in the State of
Delaware and otherwise meets the requirements of applicable law; (ii) at least a
majority of the Trustees shall be employees or officers of, or are affiliates
of, the Sponsor; (iii) one Trustee shall be the Property Trustee for so long as
this Declaration is required to qualify as an indenture under the Trust
Indenture Act, and such Property Trustee also may serve as Delaware Trustee if
it meets the applicable requirements; (iv) each Trustee, and any delegee of any
Trustee, shall be a United States Person; and (v) each Trustee, and any delegee
of any Trustee, shall at all times act as Trustee and will not, at any time, in
its capacity as Trustee, be under (or subject to) the control or direction of
any Foreign Person (pursuant to a contractual arrangement or otherwise).

     Section 6.02.  DELAWARE TRUSTEE; ELIGIBILITY.

     If required by the Statutory Trust Act, one Trustee (which may be the
Property Trustee) (the "Delaware Trustee") shall be a United States Person that
is:

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

                                       31


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

     Section 6.03.  PROPERTY TRUSTEE; ELIGIBILITY.

     (a)  There shall be at all times one Trustee (which may be the Delaware
Trustee) that shall act as Property Trustee that shall:

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

            (ii)  be a corporation that is a United States Person organized and
     doing business under the law of the United States of America or any state
     or territory thereof or of the District of Columbia, or a corporation or
     other Person that is a United States Person permitted by the Commission to
     act as an institutional trustee under the Trust Indenture Act, authorized
     under such laws to exercise corporate trust powers, having a combined
     capital and surplus of at least fifty million U.S. dollars ($50,000,000)
     and subject to supervision or examination by federal, state, territorial or
     District of Columbia authority. If such corporation publishes reports of
     condition at least annually, pursuant to law or to the requirements of the
     supervising or examining authority referred to above, then for the purpose
     of this Section 6.03(a)(ii), 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.

     (b)  If at any time the Property Trustee shall cease to be eligible to so
act under Section 6.03(a), the Property Trustee immediately shall resign in the
manner and with the effect set forth in Section 6.06(c).

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

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

     Section 6.04.  QUALIFICATIONS OF THE ADMINISTRATIVE TRUSTEES GENERALLY.

     Each Administrative Trustee shall be either a natural person who is at
least 21 years of age or a legal entity that shall act through one or more
Authorized Officers.

                                       32


     Section 6.05.  INITIAL ADMINISTRATIVE TRUSTEES.

     The initial Administrative Trustees shall be [                   ],[
              ] and [                   ], the business address of all of whom
is in care of Cinergy Corp., 130 East Randolph Drive, Chicago, IL 60601-6207.

     Section 6.06.  APPOINTMENT, REMOVAL AND RESIGNATION OF THE TRUSTEES.

     (a)  Subject to Section 6.06(b) and Section 7.05(i), the Trustees may be
appointed or removed without cause at any time:

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

            (ii)  after the issuance of any Securities, by a vote of the Holders
     of a Majority in Liquidation Amount of the Common Securities at a meeting
     of the Holders of the Common Securities or by written consent without prior
     notice in lieu of such meeting.

     (b)  The Property Trustee shall not be removed in accordance with Section
6.06(a) or Section 7.05(i) until a successor Trustee possessing the
qualifications to act as Property Trustee under Section 6.03(a) (a "Successor
Property Trustee") has been appointed and has accepted such appointment by
written instrument executed by such Successor Property Trustee and delivered to
the Administrative Trustees and the Sponsor. The Delaware Trustee shall not be
removed in accordance with Section 6.06(a) or Section 7.05(i) until a successor
Trustee possessing the qualifications to act as Delaware Trustee under Section
6.02 and Section 6.04 (a "Successor Delaware Trustee") has been appointed and
has accepted such appointment by written instrument executed by such Successor
Delaware Trustee and delivered to the Administrative Trustees and the Sponsor.

     (c)  A Trustee appointed to office shall hold office until a successor has
been appointed, until death or dissolution or until removal or resignation. Any
Trustee may resign from office (without need for prior or subsequent accounting)
by written instrument executed by such Trustee and delivered to the Sponsor and
the other Trustees, which resignation shall take effect upon such delivery or
upon such later date as is specified therein; PROVIDED that:

             (i)  no such resignation of the Property Trustee shall be
     effective:

                    (A) until a Successor Property Trustee has been appointed
             and has accepted such appointment by written instrument executed by
             such Successor Property Trustee and delivered to the Administrative
             Trustees, the Sponsor and the resigning Property Trustee; or

                    (B) until the assets of the Trust have been completely
             liquidated and the proceeds thereof distributed to the Holders of
             the Securities; and

                                       33


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

     (d)  The Holders of the Common Securities shall use their best efforts to
promptly appoint a Successor Property Trustee or Successor Delaware Trustee, as
the case may be, if the Property Trustee or the Delaware Trustee delivers an
instrument of resignation in accordance with this Section 6.06.

     (e)  If no Successor Property Trustee or Successor Delaware Trustee, as the
case may be, has been appointed and accepted appointment as provided in this
Section 6.06 within 60 days after delivery of an instrument of resignation or
removal, the resigning or removed Property Trustee or Delaware Trustee, as
applicable, may petition, at the expense of the Sponsor, any court of competent
jurisdiction for appointment of a Successor Property Trustee or Successor
Delaware Trustee, as applicable. Such court may thereupon, after prescribing
such notice, if any, as it may deem proper, appoint a Successor Property Trustee
or Successor Delaware Trustee, as the case may be.

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

     (g)  In case of the appointment hereunder of a Successor Property Trustee
or a Successor Delaware Trustee, such Successor Property Trustee or Successor
Delaware Trustee so appointed shall execute, acknowledge and deliver to the
Trust and to the retiring Property Trustee or Delaware Trustee, as the case may
be, an instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Property Trustee or Delaware Trustee shall become
effective and such Successor Property Trustee or Successor Delaware Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Property Trustee or Delaware
Trustee; but, on the request of the Sponsor or the Successor Property Trustee or
Successor Delaware Trustee, such retiring Property Trustee or Delaware Trustee
shall, upon payment of its charges, execute and deliver an instrument
transferring to such Successor Property Trustee or Successor Delaware Trustee
all the rights, powers and trusts of the retiring Property Trustee or Delaware
Trustee, as the case may be, and if the Property Trustee is the resigning
Trustee, it shall duly assign, transfer and deliver to the Successor Property
Trustee all property and money held by such retiring Property Trustee hereunder.

     Section 6.07.  VACANCIES AMONG TRUSTEES.

     If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 6.01, or if the number of Trustees
is increased pursuant to Section 6.01, a vacancy shall occur. A resolution
certifying the existence of such vacancy by the Administrative Trustees or, if
there are more than two, a majority of the Administrative Trustees shall be
conclusive evidence of the existence of such vacancy. The vacancy shall be
filled with a Trustee appointed in accordance with Section 6.06.

                                       34


     Section 6.08.  EFFECT OF VACANCIES.

     The death, resignation, retirement, removal, bankruptcy, dissolution,
liquidation, incompetence or incapacity to perform the duties of a Trustee shall
not operate to annul, dissolve or terminate the Trust nor to terminate this
Declaration. Whenever a vacancy in the number of Administrative Trustees shall
occur until such vacancy is filled by the appointment of an Administrative
Trustee in accordance with Section 6.06, the Administrative Trustees in office,
regardless of the number, shall have all the powers granted to the
Administrative Trustees and shall discharge all the duties imposed upon the
Administrative Trustees by this Declaration.

     Section 6.09.  MEETINGS.

     If there is more than one Administrative Trustee, meetings of the
Administrative Trustees shall be held from time to time upon the call of any
Administrative Trustee. Regular meetings of the Administrative Trustees may be
held at a time and place fixed by resolution of the Administrative Trustees.
Notice of any in-person meetings of the Administrative Trustees shall be hand
delivered or otherwise delivered in writing (including by facsimile, with a hard
copy by overnight courier) not less than 48 hours before such meeting. Notice of
any telephonic meetings of the Administrative Trustees shall be hand delivered
or otherwise delivered in writing (including by facsimile, with a hard copy by
overnight courier) not less than 24 hours before a meeting. Notices shall
contain a brief statement of the time, place and anticipated purposes of the
meeting. The presence (whether in person or by telephone) of an Administrative
Trustee at a meeting shall constitute a waiver of notice of such meeting except
where an Administrative Trustee attends a meeting for the express purpose of
objecting to the transaction of any activity on the ground that the meeting has
not been lawfully called or convened. Unless provided otherwise in this
Declaration, any action of the Administrative Trustees may be taken at a meeting
by vote of a majority of the Administrative Trustees present (whether in person
or by telephone) and eligible to vote with respect to such matter, provided a
Quorum is present, or without a meeting and without prior notice by the
unanimous written consent of the Administrative Trustees. In the event there is
only one Administrative Trustee, any and all action of such Administrative
Trustee shall be evidenced by a written consent of such Administrative Trustee.

     Section 6.10.  DELEGATION OF POWER BY THE ADMINISTRATIVE TRUSTEES.

     The Administrative Trustees shall have the power to delegate from time to
time to such of their number or to officers of the Trust or any other Person
that is a United States Person the doing of such things and the execution of
such instruments either in the name of the Trust or the names of the
Administrative Trustees or otherwise as the Administrative Trustees may deem
expedient, to the extent such delegation is not prohibited by applicable law or
contrary to the provisions of the Trust, as set forth herein.

     Section 6.11.  MERGER, CONSOLIDATION, CONVERSION OR SUCCESSION TO BUSINESS.

     Any entity into which the Property Trustee, the Delaware Trustee or any
Administrative Trustee that is not a natural person may be merged or converted
or with such Trustee may be consolidated, or any entity resulting from any
merger, conversion or consolidation to which such

                                       35


Trustee is a party, or any entity succeeding to all or substantially all the
corporate trust business of such Trustee, shall be the successor of such Trustee
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, PROVIDED that such entity otherwise is
qualified and eligible under this Article.

                                    ARTICLE 7
                             TERMS OF THE SECURITIES

     Section 7.01.  GENERAL PROVISIONS REGARDING THE SECURITIES.

     (a)  The Administrative Trustees shall issue, on behalf of the Trust, one
class of preferred securities representing undivided beneficial interests in the
assets of the Trust (the "Preferred Securities") and one class of common
securities representing undivided beneficial interests in the assets of the
Trust (the "Common Securities").

             (i)  Preferred Securities. The Preferred Securities of the Trust
     shall have an aggregate stated liquidation amount of
     __________________________________ dollars ($_____________)
     [(________________________ dollars ($____________) if the over-allotment
     option granted in the Underwriting Agreement is exercised in full)] or $25
     per Preferred Security. The Preferred Securities are hereby designated for
     identification purposes only as the Preferred Securities. A form of the
     Preferred Security Certificate is attached as Exhibit A hereto.

            (ii)  Common Securities. The Common Securities of the Trust shall
     have an aggregate liquidation amount of __________________________________
     dollars ($_____________)[(________________________ dollars ($____________)
     if the over-allotment option granted in the Underwriting Agreement is
     exercised in full)] or $25 per Common Security. The Common Securities are
     hereby designated for identification purposes only as the Common
     Securities. A form of the Common Security Certificates is attached as
     Exhibit B hereto.

     (b)  Payment of Distributions on, and any payment of the Redemption Price
upon a redemption of, the Preferred Securities and the Common Securities, as
applicable, shall be made Pro Rata based on the liquidation amount of such
Preferred Securities and Common Securities; PROVIDED that if on any date on
which such amounts are payable, a Trust Enforcement Event has occurred and is
continuing, then no payments shall be made on any of the Common Securities,
until all accumulated and unpaid Distributions on, or the Redemption Price of,
as the case may be, all of the outstanding Preferred Securities for which
Distributions are to be paid or that have been called for redemption, as the
case may be, are fully paid. All funds available to the Property Trustee shall
first be applied to the payment in full in cash of all Distributions on, or the
Redemption Price of, the Preferred Securities then due and payable.

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

                                       36


     (d)  Upon issuance of the Securities as provided in this Declaration, the
Securities so issued shall be validly issued, fully paid and (subject to Section
9.01(b)) non-assessable beneficial interests in the assets of the Trust.

     (e)  Every Person, by virtue of having become a Holder or a Beneficial
Owner of Preferred Securities in accordance with the terms of this Declaration,
shall be deemed to have expressly assented and agreed to the terms of, and shall
be governed by, this Declaration, the Guarantee, the Indenture, the Purchase
Contract Agreement, the Pledge Agreement and the [Subordinated] Notes.

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

     (g)  The Certificates shall be signed on behalf of the Trust by an
Administrative Trustee. Such signature shall be the manual or facsimile
signature of any Administrative Trustee. If an Administrative Trustee of the
Trust who has signed any of the Certificates ceases to be an Administrative
Trustee before such signed Certificates have been delivered by the Trust, such
Certificates nevertheless may be delivered as though the Person who signed such
Certificates had not ceased to be an Administrative Trustee. Any Certificate may
be signed on behalf of the Trust by such Persons who, at the actual date of
execution of such Certificate, shall be the Administrative Trustees of the
Trust, although at the date of the execution and delivery of this Declaration
any such Person was not such an Administrative Trustee. Certificates shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Administrative Trustees, as evidenced by their
execution thereof, and may have such letters, numbers or other marks of
identification or designation and such legends or endorsements as the
Administrative Trustees may deem appropriate, or as may be required to comply
with any law or with any rule or regulation of any stock exchange on which the
Securities may be listed, or to conform to usage.

     A Preferred Security Certificate shall not be valid until authenticated by
the manual signature of an authorized signatory of the Property Trustee. Such
signature shall be conclusive evidence that such Preferred Security Certificate
has been authenticated under this Declaration.

     Upon a written order of the Trust signed by one Administrative Trustee, the
Property Trustee shall authenticate the Preferred Security Certificates for
original issue. The aggregate number of Preferred Securities outstanding at any
time shall not exceed the liquidation amount set forth in Section 7.01(a)(i).

     The Property Trustee may appoint an authenticating agent acceptable to the
Trust, as determined by the Administrative Trustees on behalf of the Trust, to
authenticate Certificates. An authenticating agent may authenticate Certificates
whenever the Property Trustee may do so. Each reference in this Declaration to
authentication by the Property Trustee shall include authentication by such
agent. An authenticating agent shall have the same rights as the Property
Trustee to deal with the Sponsor or an Affiliate of the Sponsor.

                                       37


     (h)  The Preferred Securities, upon original issuance, shall be issued in
the form of one or more fully registered global Preferred Security Certificates
(each a "Global Certificate"), to be delivered to, or pursuant to the
instructions of, The Depository Trust Company, the initial Depositary, by or on
behalf of the Trust. Such Global Certificates initially shall be registered on
the books and records of the Trust in the name of "Cede & Co.," the nominee of
the initial Depositary. No Beneficial Owner of Preferred Securities shall
receive a definitive Preferred Security Certificate representing such Beneficial
Owner's interests in the Global Certificates, except as provided in Section
7.12. Unless and until definitive, fully registered Preferred Security
Certificates have been issued to the Beneficial Owners of Preferred Securities
pursuant to Section 7.12,

             (i)  the provisions of this Section 7.01 shall be in full force and
     effect;

            (ii)  the Trust and the Trustees shall be entitled to deal with the
     Depositary for all purposes of this Declaration (including the payment of
     Distributions on the Preferred Securities represented by the Global
     Certificates and receiving approvals, votes or consents thereunder) as the
     Holder of the Preferred Securities represented by the Global Certificates
     and, except as set forth herein or in Rule 3a-7 (if the Trust is excluded
     from the definition of an Investment Company solely by reason of Rule 3a-7)
     with respect to the Property Trustee, shall have no obligation to the
     Beneficial Owners of the Preferred Securities;

           (iii)  to the extent that the provisions of this Section 7.01
     conflict with any other provisions of this Declaration, the provisions of
     this Section 7.01 shall control; and

            (iv)  the rights of the Beneficial Owners of the Preferred
     Securities shall be exercised only through the Depositary and shall be
     limited to those established by law and agreements between such Beneficial
     Owners and the Depositary and/or the Depositary Participants; PROVIDED that
     no such agreement shall give to any Person any rights against the Trust or
     the Property Trustee without the written consent of the parties so
     affected. The Depositary shall make book-entry transfers among Depositary
     Participants and receive and transmit Distributions on the Preferred
     Securities represented by the Global Certificates to such Depositary
     Participants; PROVIDED that solely for the purposes of determining whether
     the Holders of the requisite amount of Preferred Securities have voted on
     any matter provided for in this Declaration, so long as definitive
     Preferred Security Certificates have not been issued, the Trustees may rely
     conclusively on, and shall be fully protected in relying on, any written
     instrument (including a proxy) delivered to the Trustees by the Depositary
     setting forth the votes of the Beneficial Owners of the Preferred
     Securities or assigning the right to vote on any matter to any other
     Persons either in whole or in part.

     Whenever a notice or other communication to the Holder of the Preferred
Securities is required to be given under this Declaration, unless and until
definitive Preferred Security Certificates have been issued pursuant to Section
7.01(g), the Trustees shall deliver all such notices and communications
specified herein to be given to the Holders of the Preferred Securities to the
Depositary, and, with respect to any Preferred Security Certificate registered
in the name of a Depositary or the nominee of a Depositary, the Trustees may
conclusively rely on,

                                       38


and shall be fully protected in relying on, any written instrument (including a
proxy) delivered to the Trustees by the Depositary setting forth the votes of
the Beneficial Owners of the Preferred Securities or assigning the right to vote
on any matter or any other Persons either in whole or in part. Multiple requests
and directions from and votes of the Depositary as the Holder of the Preferred
Securities represented by Global Certificates with respect to any particular
matter shall not be deemed inconsistent to the extent they do not represent an
amount of Preferred Securities in excess of those held in the name of the
Depositary or its nominee.

     Section 7.02.  DISTRIBUTIONS.

     (a)  Holders of the Securities shall be entitled to receive Distributions
that shall accumulate and be payable at the rate per annum of __% of the stated
liquidation amount of $25 per Security until _____________, and at the Reset
Rate thereafter. The amount of Distributions payable for any period shall be
computed (i) for any full quarterly distribution period, on the basis of a
360-day year of twelve 30-day months and (ii) for any period shorter than a full
quarterly distribution period, on the basis of a 30-day month and, for any
period of less than one month, on the basis of the actual number of days elapsed
per 30-day month. Subject to Section 7.01(b), Distributions shall be made on the
Securities on a Pro Rata basis. Distributions on the Securities shall accumulate
from ____________, 2003, shall be cumulative and shall be payable quarterly, in
arrears, on ___________, ___________, ___________ and __________ of each year,
commencing ___________, 2003, when, as and if available for payment, by the
Property Trustee, except as otherwise described below. Distributions shall be
payable only to the extent that payments are made to the Trust in respect of the
[Subordinated] Notes held by the Property Trustee and to the extent that the
Trust has funds available for the payment of such Distributions in the Property
Account.

     (b)  Distributions not paid on the scheduled payment date shall accumulate
and compound quarterly at the rate of __% per annum until ______________ and at
the Reset Rate thereafter ("Compounded Distributions"). "Distributions" shall
mean ordinary cumulative distributions together with any Compounded
Distributions.

     (c)  If and to the extent that the [Subordinated] Notes Issuer makes a
payment of principal of and any premium or interest on the [Subordinated] Notes
held by the Property Trustee (the amount of any such payment being a "Payment
Amount"), the Property Trustee shall and is directed, to the extent funds are
available for that purpose, to make a Pro Rata distribution of the Payment
Amount to Holders, subject to Section 7.01(b).

     (d)  Distributions on the Securities shall be payable to the Holders
thereof as they appear on the register of the Trust as of the close of business
on the relevant record dates. If the Preferred Securities are represented by one
or more Global Certificates, the relevant record dates shall be the close of
business on the Business Day preceding such Distribution payment date, unless a
different regular record date is established or provided for the corresponding
interest payment date on the [Subordinated] Notes. The relevant record dates for
the Common Securities shall be the same as for the Preferred Securities. If the
Preferred Securities are not represented by one or more Global Certificates, the
relevant record dates for the Preferred Securities shall be selected by the
Administrative Trustees and shall be the fifteenth Business Day prior to the
relevant Distribution payment dates. At all times, the Distribution payment
dates shall

                                       39


correspond to the interest payment dates on the [Subordinated] Notes.
Distributions payable on any Securities that are not punctually paid on any
Distribution payment date, as a result of the [Subordinated] Notes Issuer having
failed to make a payment under the [Subordinated] Notes, shall cease to be
payable to the Person in whose name such Securities are registered on the
relevant record date, and such defaulted Distribution instead shall be payable
to the Person in whose name such Securities are registered on the special record
date or other specified date determined in accordance with this Declaration. If
any date on which Distributions are payable on the Securities is not a Business
Day, then payment of the Distribution payable on such date shall be made on the
next day that is a Business Day (and without any interest or other payment in
respect of any such delay), except that if such Business Day is in the next
calendar year, such payment shall be made on the preceding Business Day, with
the same force and effect as if made on such payment date.

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

     Section 7.03.  REDEMPTION OF SECURITIES.

     (a)  Upon the repayment of the [Subordinated] Notes held by the Trust at
the stated maturity of the [Subordinated] Notes, the proceeds from such
repayment shall be simultaneously applied Pro Rata (subject to Section 7.01(b))
to redeem Securities having an aggregate liquidation amount equal to the
aggregate principal amount of the [Subordinated] Notes so repaid.

     (b)  If the [Subordinated] Notes Issuer redeems the [Subordinated] Notes
upon the occurrence and continuance of a Tax Event, the proceeds from such
redemption shall be applied by the Property Trustee to redeem the Securities in
whole (but not in part) at a price per Security equal to the Redemption Amount
attributable to a [Subordinated] Note with a principal amount equal to the
stated liquidation amount of such Security plus any accumulated and unpaid
Distributions thereon to the Tax Event Redemption Date. If, following the
occurrence of a Tax Event, the [Subordinated] Notes Issuer exercises its option
to redeem the [Subordinated] Notes, the [Subordinated] Notes Issuer shall
appoint the Quotation Agent. Subject to the Trust's fulfillment of the notice
requirements set forth in Section 7.04(a), if a Tax Event Redemption occurs
prior to the Purchase Contract Settlement Date, the price payable in liquidation
of the Securities will be distributed to [ ], acting as the securities
intermediary under the Pledge Agreement, which in turn will apply that amount to
purchase the Treasury Portfolio and remit the remaining portion, if any, of such
price to [ ], acting as the purchase contract agent under the Purchase Contract
Agreement, for payment to the Holders of the Securities. If such excess amount
referred to in the immediately preceding sentence is to be paid to Holders of
the Securities, (i) with respect to the Preferred Securities represented by one
or more Global Certificates, by 12:00 noon, New York City time, on the Tax Event
Redemption Date, the Purchase Contract Agent will deposit irrevocably with the
Depositary or its nominee funds sufficient to pay such amount, and the Purchase
Contract Agent shall give the Depositary irrevocable instructions and authority
to pay such amount to the Beneficial Owners of the Preferred Securities, and
(ii) with respect to Securities not represented by one or more Global
Certificates, the Purchase Contract Agent shall pay such amount to the

                                       40


Holders of such Securities by check mailed to the address of each Holder
appearing on the Security Register of the Trust on the Tax Event Redemption
Date. If a Tax Event Redemption occurs after the Purchase Contract Settlement
Date, the Treasury Portfolio shall not be purchased and the Property Trustee
shall distribute to the Holders of the Securities on the Tax Event Redemption
Date, the Redemption Price payable in liquidation of such Holders' interests in
the assets of the Trust in accordance with Section 7.04(b) below.

     Section 7.04.  REDEMPTION PROCEDURES.

     (a)  Notice of any redemption of, or notice of distribution of
[Subordinated] Notes in exchange for, the Securities (a "Redemption/Distribution
Notice"), which notice shall be irrevocable, shall be given by the Trust by mail
to each Holder of Securities to be redeemed or exchanged at least 30 but no more
than 60 days before the date fixed for redemption or exchange thereof which, in
the case of a redemption, shall be the date fixed for redemption of the
[Subordinated] Notes. For purposes of the calculation of the date of redemption
or exchange and the dates on which notices are given pursuant to this Section
7.04(a), a Redemption/Distribution Notice shall be deemed to be given on the day
such notice is first mailed by first-class mail, postage prepaid, to the Holders
of the Securities. Each Redemption/Distribution Notice shall be addressed to the
Holders of the Securities at the address of each such Holder appearing in the
register of the Trust. All notices of redemption shall state:

             (i)  the date fixed for redemption;

            (ii)  the Redemption Price;

           (iii)  the applicable CUSIP number;

            (iv)  that on the date fixed for redemption the Redemption Price
     will become due and payable upon each Security to be redeemed and that
     Distributions thereon will cease to accrue on and after said date; and

             (v)  the place or places where such Securities are to be
     surrendered for payment of the Redemption Price.

No defect in the Redemption/Distribution Notice or in the mailing of either
thereof with respect to any Holder shall affect the validity of the redemption
or exchange proceedings with respect to any other Holder.

     (b)  Subject to the Trust's fulfillment of the notice requirements set
forth in Section 7.04(a), if Securities are to be redeemed, other than in
connection with a Tax Event Redemption which occurs prior to the Purchase
Contract Settlement Date, which shall occur in accordance with Section 7.03(b)
above, then (PROVIDED that the [Subordinated] Notes Issuer has paid the Property
Trustee a sufficient amount of cash in connection with the related redemption or
maturity of the [Subordinated] Notes) (i) with respect to the Preferred
Securities represented by one or more Global Certificates, by 12:00 noon, New
York City time, on the redemption date, the Property Trustee will deposit
irrevocably with the Depositary or its nominee funds sufficient to pay the
applicable Redemption Price, and the Property Trustee shall give the Depositary
irrevocable instructions and authority to pay the Redemption Price to the
Beneficial Owners of

                                       41


the Preferred Securities, and (ii) with respect to Securities not represented by
one or more Global Certificates, the Property Trustee shall pay the applicable
Redemption Price to the Holders of such Securities by check mailed to the
address of each Holder appearing on the register of the Trust on the redemption
date. If any date fixed for redemption of Securities is not a Business Day, then
payment of the Redemption Price payable on such date shall be made on the next
Business Day (without any interest thereon), except that if such Business Day
falls in the next calendar year, such payment shall be made on the preceding
Business Day, in each case with the same force and effect as if made on such
date fixed for redemption. Notwithstanding the foregoing, so long as the Holder
of any Preferred Securities is the Collateral Agent or the Purchase Contract
Agent, the payment of the Redemption Price in respect of the Preferred
Securities held by the Collateral Agent or the Purchase Contract Agent shall be
made no later than 12:00 noon, New York City time, on the redemption date by
check or wire transfer in immediately available funds at such place and to such
account as may be designated by the Collateral Agent or the Purchase Contract
Agent. If payment of the Redemption Price in respect of any Securities is
improperly withheld or refused and not paid either by the Trust or by the
Sponsor as guarantor pursuant to the Guarantee, then Distributions on such
Securities shall continue to accumulate at the then applicable rate, from the
original redemption date to the actual date of payment, in which case the actual
payment date shall be the date fixed for redemption for purposes of calculating
the Redemption Price. For these purposes, the applicable Redemption Price shall
not include Distributions that are being paid to Holders of Securities who were
not Holders of Securities on a relevant record date. If a
Redemption/Distribution Notice has been given and funds have been deposited or
paid as required, then immediately prior to the close of business on the date of
such deposit or payment, Distributions will cease to accumulate on the
Securities called for redemption, and all rights of Holders of such Securities
so called for redemption shall cease, except the right of the Holders of such
Securities to receive the Redemption Price, but without interest on such
Redemption Price, and from and after the date fixed for redemption, such
Securities will cease to be outstanding.

     Neither the Administrative Trustees nor the Trust shall be required to
register or cause to be registered the transfer of any Securities that have been
called for redemption, except for the unredeemed portion of any Securities being
redeemed in part.

     (c)  Subject to the foregoing and applicable law (including, without
limitation, United States federal securities laws), the [Subordinated] Notes
Issuer or its Affiliates may purchase, at any time and from time to time,
outstanding Preferred Securities by tender, in the open market, by private
agreement or otherwise.

     Section 7.05.  VOTING RIGHTS OF THE PREFERRED SECURITIES.

     (a)  Except as provided under this Section 7.05 and Section 11.01 and as
otherwise required by the Statutory Trust Act, the Trust Indenture Act and other
applicable law, the Holders of the Preferred Securities shall have no voting
rights.

     (b)  Subject to the requirement of the Property Trustee obtaining a tax
opinion in certain circumstances set forth in Section 7.05(d), the Holders of a
Majority in Liquidation Amount of the Preferred Securities, voting separately as
a class, shall have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Property

                                       42


Trustee, or to direct the exercise of any trust or power conferred upon the
Property Trustee under this Declaration, including the right to direct the
Property Trustee, as Holder of the [Subordinated] Notes, to (i) exercise the
remedies available to it under the Indenture, (ii) consent to any amendment or
modification of the Indenture or the [Subordinated] Notes where such consent is
required or (iii) waive any past default and its consequences that are waivable
under the Indenture; PROVIDED that if an Indenture Event of Default has occurred
and is continuing, then the Holders of 25% of the aggregate stated liquidation
amount of the Preferred Securities may direct the Property Trustee to declare
the principal of and interest on the [Subordinated] Notes due and payable;
PROVIDED FURTHER that where a consent or action under the Indenture would
require the consent or act of the Holders of more than a majority of the
aggregate principal amount of [Subordinated] Notes affected thereby, the
Property Trustee only may give such consent or take such action at the direction
of the Holders of at least the same proportion in aggregate stated liquidation
amount of the Preferred Securities; and PROVIDED FURTHER, however, that (subject
to the provisions of Section 3.09) the Property Trustee shall have the right to
decline to follow any such direction if the Property Trustee, being advised by
counsel, determines that the action or proceeding so directed may not lawfully
be taken or if the Property Trustee, in good faith, by its board of directors or
trustees, executive committee, or a trust committee of directors or trustees,
and/or Responsible Officers, shall determine that the action or proceeding so
directed would involve the Property Trustee in personal liability.

     (c)  If the Property Trustee fails to enforce its rights under the
[Subordinated] Notes after a Holder of Preferred Securities has made a written
request, such Holder of Preferred Securities may institute, to the fullest
extent permitted by law, a legal proceeding directly against the [Subordinated]
Notes Issuer to enforce the Property Trustee's rights under the Indenture
without first instituting any legal proceeding against the Property Trustee or
any other Person. In addition, if a Trust Enforcement Event has occurred and is
continuing and such event is attributable to the failure of the [Subordinated]
Notes Issuer to make any interest, principal or other required payments when due
under the Indenture, then a Holder of Preferred Securities may institute a
Direct Action against the [Subordinated] Notes Issuer on or after the respective
due date specified in the [Subordinated] Notes. In connection with such Direct
Action, the [Subordinated] Notes Issuer will be subrogated to the rights of such
Holder of Preferred Securities to the extent of any payment made by the
[Subordinated] Notes Issuer to such Holders of Preferred Securities in such
Direct Action.

     (d)  The Property Trustee shall notify all Holders of the Preferred
Securities of any notice of any Indenture Event of Default received from the
[Subordinated] Notes Issuer with respect to the [Subordinated] Notes. Such
notice shall state that such Indenture Event of Default also constitutes a Trust
Enforcement Event. Except with respect to directing the time, method, and place
of conducting a proceeding for a remedy, the Property Trustee shall be under no
obligation to take any of the actions described in clauses (i) and (ii) of
Section 7.05(b) above, unless the Property Trustee has received an opinion of
independent tax counsel to the effect that the Trust will not fail to be
classified as a grantor trust for United States federal income tax purposes as a
result of such action, and that each Holder of Preferred Securities shall be
treated as owning an undivided beneficial interest in the [Subordinated] Notes.

     (e)  If the consent of the Property Trustee, as the Holder of the
[Subordinated] Notes, is required under the Indenture with respect to any
amendment or modification of the Indenture, the

                                       43


Property Trustee shall request the direction of the Holders of the Securities
with respect to such amendment or modification and shall vote with respect to
such amendment or modification as directed by a Majority in Liquidation Amount
of the Securities voting together as a single class; PROVIDED that where a
consent under the Indenture would require the consent of the Holders of more
than a majority of the aggregate principal amount of the [Subordinated] Notes,
the Property Trustee only may give such consent at the direction of the Holders
of at least the same proportion in aggregate stated liquidation amount of the
Securities. The Property Trustee shall not take any such action in accordance
with the directions of the Holders of the Securities unless the Property Trustee
has obtained an opinion of independent tax counsel to the effect that the Trust
will not be classified as other than a grantor trust for United States federal
income tax purposes as a result of such action, and that each Holder will be
treated as owning an undivided beneficial interest in the [Subordinated] Notes.

     (f)  No vote or consent of the Holders of the Preferred Securities shall be
required for the Trust to redeem and cancel the Preferred Securities or
distribute the [Subordinated] Notes in accordance with this Declaration and the
terms of the Securities.

     (g)  Notwithstanding that the Holders of the Preferred Securities are
entitled to vote or consent under any of the circumstances described above, any
of the Preferred Securities that are owned at such time by the [Subordinated]
Notes Issuer, the Trustees or any entity directly or indirectly controlled by,
or under direct or indirect common control with, the [Subordinated] Notes Issuer
or any Trustee shall not be entitled to vote or consent and shall be treated,
for purposes of such vote or consent, as if such Preferred Securities were not
outstanding.

     (h)  Except as provided under Section 7.05(i), the Holders of the Preferred
Securities shall have no rights to appoint or remove the Trustees, who, subject
to Section 6.06, may be appointed, removed or replaced by the Holders of the
Common Securities.

     (i)  If an Indenture Event of Default has occurred and is continuing, the
Property Trustee and the Delaware Trustee may be removed and replaced, subject
to Section 6.06(b), at such time by a Majority in Liquidation Amount of the
Preferred Securities.

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

             (i)  is not waivable under the Indenture, then the Trust
     Enforcement Event under this Declaration also shall not be waivable; and

            (ii)  requires the vote or consent of the holders of greater than a
     majority in principal amount of the [Subordinated] Notes (a
     "Supermajority") to be waived under the Indenture, the related Trust
     Enforcement Event under this Declaration only may be waived by the vote or
     written consent of the Holders of at least the same Supermajority in
     aggregate stated liquidation amount of the Preferred Securities
     outstanding.

Upon such waiver, any such Trust Enforcement Event in respect of the Preferred
Securities shall be deemed to have been cured for every purpose of this
Declaration and the Preferred Securities,

                                       44


but no such waiver shall extend to any subsequent or other Trust Enforcement
Event with respect to the Preferred Securities or impair any right consequent
thereon. A waiver of an Indenture Event of Default under the Indenture by the
Property Trustee at the direction of the Holders of the Preferred Securities
shall also constitute a waiver of the corresponding Trust Enforcement Event
under this Declaration. Any waiver by the Holders of the Preferred Securities of
a Trust Enforcement Event with respect to the Preferred Securities also shall be
deemed to constitute a waiver by the Holders of the Common Securities of any
such Trust Enforcement Event with respect to the Common Securities for all
purposes of this Declaration without any further act, vote or consent of the
Holders of the Common Securities.

     (k)  The Holders of the Common Securities may waive, by vote or written
consent, any past Trust Enforcement Event in respect of the Common Securities
and its consequences, PROVIDED that if the underlying Indenture Event of Default
is not waivable under the Indenture, then, except where the Holders of the
Common Securities have been deemed to have waived such Trust Enforcement as
provided below in this Section 7.05(k), the related Trust Enforcement Event
under this Declaration also shall not be waivable. The Holders of the Common
Securities shall be deemed to have waived any and all Trust Enforcement Events
in respect of the Common Securities and the consequences thereof until all Trust
Enforcement Events in respect of the Preferred Securities have been cured,
waived or otherwise eliminated. Until all Trust Enforcement Events in respect of
the Preferred Securities have been so cured, waived or otherwise eliminated, the
Property Trustee shall be deemed to be acting solely on behalf of the Holders of
the Preferred Securities, and only the Holders of the Preferred Securities shall
have the right to direct the Property Trustee. Subject to the foregoing
provisions of this Section 7.05(k), upon such cure, waiver or other elimination,
any Trust Enforcement Event in respect of the Common Securities shall be deemed
to have been cured for every purpose of this Declaration and the Common
Securities, but no such waiver shall extend to any subsequent or other Trust
Enforcement Event with respect to the Common Securities or impair any right
consequent thereon.

     (l)  The foregoing provisions of this Section 7.05(j), (k) and (l) shall be
in lieu of Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act,
and Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby
expressly excluded from this Declaration and the Securities, as permitted by the
Trust Indenture Act.

     Section 7.06.  VOTING RIGHTS OF THE COMMON SECURITIES.

     (a)  Except as provided under Section 6.01(b), this Section 7.06 and
Section 11.01 and as otherwise required by the Statutory Trust Act, the Trust
Indenture Act or other applicable law or provided by this Declaration, the
Holders of the Common Securities shall have no voting rights.

     (b)  Subject to Section 7.05(i), the Holders of the Common Securities shall
be entitled to vote to appoint, remove or replace any Trustee or to increase or
decrease the number of Trustees in accordance with Article 6.

     (c)  Subject to Section 7.05 and only after all Trust Enforcement Events
with respect to the Preferred Securities have been cured, waived, or otherwise
eliminated and subject to the

                                       45


requirement of the Property Trustee obtaining a tax opinion in certain
circumstances set forth in this paragraph (c), the Holders of the Common
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Property Trustee, or
to direct the exercise of any trust or power conferred upon the Property Trustee
under this Declaration, including the right to direct the Property Trustee, as
Holder of the [Subordinated] Notes, to (i) exercise the remedies available to it
under the Indenture, (ii) consent to any amendment or modification of the
Indenture or the [Subordinated] Notes where such consent is required or (iii)
waive any past default and its consequences that are waivable under the
Indenture; PROVIDED that where a consent or action under the Indenture would
require the consent or act of the Holders of more than a majority of the
aggregate principal amount of [Subordinated] Notes affected thereby, only the
Holders of at least the same proportion of the aggregate stated liquidation
amount of the Common Securities may direct the Property Trustee to give such
consent or take such action. Except with respect to directing the time, method,
and place of conducting a proceeding for a remedy, the Property Trustee shall be
under no obligation to take any of the actions described in clauses (i) and (ii)
above unless the Property Trustee has obtained an opinion of independent tax
counsel to the effect that, as a result of such action, for United States
federal income tax purposes the Trust will not fail to be classified as a
grantor trust and each Holder will be treated as owning an undivided beneficial
interest in the [Subordinated] Notes.

     (d)  If the Property Trustee fails to enforce its rights under the
[Subordinated] Notes after the Holders of the Common Securities have made a
written request, the Holders of the Common Securities may institute, to the
fullest extent permitted by law, a legal proceeding directly against the
[Subordinated] Notes Issuer to enforce the Property Trustee's rights under the
[Subordinated] Notes without first instituting any legal proceeding against the
Property Trustee or any other Person.

     (e)  A waiver of an Indenture Event of Default with respect to the
[Subordinated] Notes shall constitute a waiver of the corresponding Trust
Enforcement Event.

     (f)  Any required approval or direction of the Holders of the Common
Securities may be given at a separate meeting of the Holders of the Common
Securities convened for such purpose, at a meeting of all of the Holders of the
Securities or pursuant to written consent without prior notice. The
Administrative Trustees shall cause a notice of any meeting at which the Holders
of the Common Securities are entitled to vote to be mailed to the Holders of the
Common Securities. Such notice shall include a statement setting forth: (i) the
date of such meeting; (ii) a description of any resolution proposed for adoption
at such meeting on which the Holders of the Common Securities are entitled to
vote; and (iii) instructions for the delivery of proxies.

     (g)  No vote or consent of the Holders of the Common Securities shall be
required for the Trust to redeem and cancel the Common Securities or to
distribute [Subordinated] Notes in accordance with this Declaration and the
terms of the Securities.

                                       46


     Section 7.07.  PAYING AGENT.

     The Trust shall maintain in the Borough of Manhattan, New York City, State
of New York, an office or agency where the Preferred Securities may be presented
for payment. The Administrative Trustees shall appoint such paying agent (which
shall be a bank or trust company acceptable to the [Subordinated] Notes Issuer
and shall comply with Section 317(b) of the Trust Indenture Act) and may appoint
one or more additional paying agents in such other locations as they shall
determine. The term "Paying Agent" includes any additional paying agent. The
Administrative Trustees may change any Paying Agent without prior notice to the
Holders of the Securities. The Administrative Trustees shall notify the Property
Trustee of the name and address of any Paying Agent not a party to this
Declaration. If the Administrative Trustees, on behalf of the Trust, fail to
appoint or maintain another entity as Paying Agent, the Property Trustee shall
act as such. The Paying Agent shall be permitted to resign as Paying Agent upon
30 days' written notice to the Property Trustee and the [Subordinated] Notes
Issuer.

     Section 7.08.  LISTING.

     The Sponsor shall use its best efforts to cause the Stock Purchase Units to
be listed and maintained as listed for quotation on the [New York Stock
Exchange.]

     Section 7.09.  TRANSFER OF THE SECURITIES.

     (a)  The Preferred Securities initially shall be pledged, pursuant to the
terms of the Pledge Agreement, as collateral to secure the obligations of the
Holders of Stock Purchase Units to purchase common shares of the Sponsor in
accordance with the terms of the Purchase Contract Agreement.

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

            (ii)  Subject to this Section 7.09 and Section 7.12, the Preferred
     Securities shall be freely transferable.

           (iii)  The Trust shall cause to be kept at the Corporate Trust Office
     a register in which, subject to such reasonable regulations as it may
     prescribe, the Trust shall provide for the registration of Preferred
     Securities and of transfers of Preferred Securities. The Property Trustee
     is hereby appointed "Security Registrar" for the purpose of registering
     Preferred Securities and transfers of Preferred Securities as herein
     provided.

            (iv)  Upon surrender for registration of transfer of any Preferred
     Securities at an office or agency of the Trust designated for such purpose,
     an Administrative Trustee shall execute, and the Property Trustee shall
     authenticate and deliver, in the name of the designated transferee or
     transferees, one or more new Preferred Securities of any authorized
     denominations and of a like aggregate principal amount.

                                       47


          (v)     At the option of the Holder, Preferred Securities may be
     exchanged for other Preferred Securities of any authorized denominations
     and of a like aggregate principal amount, upon surrender of the Preferred
     Securities to be exchanged at such office or agency. Whenever any Preferred
     Securities are so surrendered for exchange, an Administrative Trustee shall
     execute, and the Property Trustee shall authenticate and deliver, the
     Preferred Securities that the Holder making the exchange is entitled to
     receive.

          (vi)    If so required by the Trust or the Property Trustee, every
     Preferred Security presented or surrendered for registration of transfer or
     for exchange shall be duly endorsed, or accompanied by a duly executed
     written instrument of transfer in form satisfactory to the Trust and the
     Security Registrar, by the Holder thereof or his attorney duly authorized
     in writing.

          (vii)   No service charge shall be made for any registration of
     transfer or exchange of Preferred Securities, but the Trust 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 Preferred Securities.

     (b)  The [Subordinated] Notes Issuer may not transfer the Common Securities
except in connection with the transactions permitted under Section 10.01 of the
Indenture; PROVIDED that each Holder of the Common Securities shall at all times
be a United States Person. To the fullest extent permitted by law, any attempted
transfer of the Common Securities other than as set forth in this Section
7.09(b) shall be null and void.

     Section 7.10.  MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.

     If:

     (a)  any mutilated Certificates are surrendered to the Administrative
Trustees, or if the Administrative Trustees receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate; and

     (b)  there shall be delivered to the Administrative Trustees such security
or indemnity as may be required by them to keep each of them and the Property
Trustee harmless, then, in the absence of notice that such Certificate has been
acquired by a protected purchaser, any Administrative Trustee shall execute and
the Property Trustee shall authenticate and deliver, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Certificate, a new Certificate
of like denomination. In connection with the issuance of any new Certificate
under this Section 7.10, the Administrative Trustees may require the payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith. Any duplicate Certificate issued pursuant to
this Section 7.10 shall constitute conclusive evidence of an ownership interest
in the relevant Securities, as if originally issued, whether or not the lost,
stolen or destroyed Certificate is found at any time.

                                       48


     Section 7.11.  DEEMED HOLDERS.

     The Trustees may treat the Person in whose name any Certificate is
registered on the register of the Trust as the sole holder of such Certificate
and of the Securities represented thereby for purposes of receiving
Distributions and for all other purposes whatsoever. Accordingly, the Trustees
shall not be bound to recognize any equitable or other claim to or interest in
such Certificate or in the Securities represented by such Certificate on the
part of any Person, whether or not the Trust has actual or other notice thereof.

     Section 7.12.  GLOBAL CERTIFICATES.

     Global Certificates shall bear a legend substantially to the following
effect:

          "This Preferred Security is registered in the name of The
          Depository Trust Company, a New York corporation (the
          "Depositary"), or a nominee of the Depositary. This
          Preferred Security is exchangeable for Preferred Securities
          registered in the name of a person other than the Depositary
          or its nominee only in the limited circumstances described
          in the Declaration, and no transfer of this Preferred
          Security (other than a transfer of this Preferred Security
          as a whole by the Depositary to a nominee of the Depositary
          or by a nominee of the Depositary to the Depositary or
          another nominee of the Depositary) may be reregistered
          except in limited circumstances.

          Unless this Global Certificate is presented by an authorized
          representative of the Depositary to CC Funding Trust II or
          its agent for registration of transfer, exchange or payment,
          and any certificate issued is registered in the name of Cede
          & Co. or such other name as requested by an authorized
          representative of the Depositary (and any payment hereon is
          made to Cede & Co. or to such other entity as is requested
          by an authorized representative of the Depositary), and
          except as otherwise provided in the Amended and Restated
          Declaration of CC Funding Trust II dated as of
          __________________, 2003, ANY TRANSFER, PLEDGE OR OTHER USE
          HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON (OTHER
          THAN PURSUANT TO THE PLEDGE AGREEMENT) IS WRONGFUL since the
          registered owner hereof, Cede & Co., has an interest
          herein."

     Preferred Securities not represented by a Global Certificate issued in
exchange for all or a portion of the Preferred Securities represented by a
Global Certificate pursuant to this Section 7.12 shall be registered in such
names and in such authorized denominations as the Depositary, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Property Trustee. Upon execution and authentication, the Property
Trustee shall deliver any Preferred Securities not represented by a Global
Certificate to the Persons in whose names such definitive Preferred Securities
are so registered.

                                       49


     At such time as the Preferred Securities represented by a Global
Certificate have been redeemed, repurchased or canceled, such Global Certificate
shall be canceled, upon receipt thereof, by the Property Trustee in accordance
with standing procedures of the Depositary. At any time prior to such
cancellation, if any Preferred Securities represented by a Global Certificate
are exchanged for Preferred Securities not represented by a Global Certificate,
redeemed, canceled or transferred to a transferee who receives Preferred
Securities not represented by a Global Certificate, or if any Preferred Security
not represented by a Global Certificate is exchanged or transferred for a
Preferred Security represented by a Global Certificate, then, in accordance with
the standing procedures of the Depositary, the liquidation amount of the
Preferred Securities represented by the Global Certificate shall be reduced or
increased, as the case may be, and an endorsement shall be made on such Global
Certificate by the Property Trustee to reflect such reduction or increase.

     If at any time the Depositary notifies the Trust that it is unwilling,
unable or ineligible to continue as Depositary for the Preferred Securities, the
Administrative Trustees shall appoint a successor Depositary with respect to the
Preferred Securities. If a successor Depositary is not appointed within 90 days
after the Trust receives such notice or becomes aware of such ineligibility, the
Trust's election that the Preferred Securities be represented by one or more
Global Certificates shall no longer be effective, and an Administrative Trustee
shall execute, and the Property Trustee will authenticate and deliver, Preferred
Securities in definitive registered form, in any authorized denominations, in an
aggregate stated liquidation amount equal to the aggregate stated liquidation
amount of the Preferred Securities represented by the Global Certificates in
exchange for such Global Certificates.

     An Administrative Trustee on behalf of the Trust at any time and in its
sole discretion may determine that the Preferred Securities issued in the form
of one or more Global Certificates shall no longer be represented by Global
Certificates. In such event an Administrative Trustee on behalf of the Trust
shall execute, and the Property Trustee shall authenticate and deliver,
Preferred Securities in definitive registered form, in any authorized
denominations, in an aggregate stated liquidation amount equal to the aggregate
stated liquidation amount of the Preferred Securities represented by the Global
Certificates, in exchange for such Global Certificates.

     Notwithstanding any other provisions of this Declaration (other than the
provisions set forth in Section 7.09), Preferred Securities represented by
Global Certificates may not be transferred as a whole except by the Depositary
to a nominee of the Depositary or by a nominee of the Depositary to the
Depositary or another nominee of the Depositary or by the Depositary or any such
nominee to a successor Depositary or a nominee of such successor Depositary.

     Section 7.13.  REMARKETING.

     (a)  So long as the Preferred Securities and the Stock Purchase Units are
evidenced by one or more global certificates held by the Depositary, the
[Subordinated] Notes Issuer shall request, not later than 15 nor more than 30
calendar days prior to the Remarketing Date, that the Depositary notify the
Holders of the Preferred Securities and the holders of Stock Purchase Units of
the Remarketing and of the procedures that must be followed if a Holder of Stock
Purchase Units wishes to make a Cash Settlement.

                                       50


     (b)  Not later than 5:00 p.m., New York City time, on the seventh Business
Day preceding the Purchase Contract Settlement Date, each Holder of Preferred
Securities may elect to have the Preferred Securities held by such Holder
remarketed in the Remarketing. Under Section 5.02 of the Purchase Contract
Agreement, holders of Stock Purchase Units that do not give notice of their
intention to make a Cash Settlement of the Purchase Contract component of their
Stock Purchase Units prior to such time in the manner specified in such Section,
or have given such notice but fail to deliver cash prior to 11:00 a.m., New York
City time, on or prior to the fifth Business Day preceding the Purchase Contract
Settlement Date, shall be deemed to have consented to the disposition of the
Preferred Securities comprising a component of their Stock Purchase Units in the
Remarketing. Holders of the Preferred Securities that are not a component of
Stock Purchase Units wishing to elect to have their Preferred Securities
remarketed shall give to the Property Trustee notice of their election prior to
11:00 a.m., New York City time on the fifth Business Day prior to the Purchase
Contract Settlement Date. Any such notice shall be irrevocable and may not be
conditioned upon the level at which the Reset Rate is established in the
Remarketing. Promptly after 11:00 a.m., New York City time, on such fifth
Business Day, the Property Trustee, based on the notices received by it prior to
such time (including notices from the Purchase Contract Agent as to Purchase
Contracts for which Cash Settlement has been elected and cash received), shall
notify the Trust, the Sponsor and the Remarketing Agent of the number of
Preferred Securities to be tendered for purchase in the Remarketing.

     (c)  If any Holder of Stock Purchase Units does not give a notice of its
intention to make a Cash Settlement or gives such notice but fails to deliver
cash as described in Section 7.13(b), or gives a notice of election to have
Preferred Securities that are not a component of Stock Purchase Units
remarketed, then the Preferred Securities of such Holder shall be deemed
tendered for purchase in the Remarketing, notwithstanding any failure by such
Holder to deliver or properly deliver such Preferred Securities to the
Remarketing Agent for purchase.

     (d)  The right of each Holder to have Preferred Securities tendered for
purchase shall be limited to the extent that (i) the Remarketing Agent conducts
a Remarketing pursuant to the terms of the Remarketing Agreement, (ii) the
Remarketing Agent is able to find a purchaser or purchasers for the tendered
Preferred Securities and (iii) such purchaser or purchasers deliver the purchase
price therefor to the Remarketing Agent.

     (e)  On the Remarketing Date, pursuant to the Remarketing Agreement, the
Remarketing Agent shall use reasonable efforts to remarket, at a price equal to
[100.25]% of the aggregate stated liquidation amount thereof, the Preferred
Securities tendered or deemed tendered for purchase.

     (f)  If, as a result of the efforts described in Section 7.13(e), the
Remarketing Agent has determined that it will not be able to remarket all of the
Preferred Securities tendered or deemed tendered for purchase at a price of
[100.25]% of the aggregate stated liquidation amount of such Preferred
Securities, the Remarketing Agent shall determine the Reset Rate, which shall be
the rate per annum (rounded to the nearest one-thousandth (0.001) of one percent
per annum), sufficient to cause the then current aggregate market value of the
Preferred Securities to be equal to [100.25]% of the aggregate stated
liquidation amount of such Preferred Securities, which rate shall be the lowest
rate per annum that in the sole reasonable discretion of the Remarketing Agent
will enable it to remarket all of the Preferred Securities tendered or deemed
tendered for

                                       51


Remarketing at a price of [100.25]% of the aggregate stated liquidation amount
of such Preferred Securities.

     (g)  If none of the Holders of the Preferred Securities or the holders of
the Stock Purchase Units elect to have Preferred Securities remarketed in the
Remarketing, the Reset Rate shall be the rate determined by the Remarketing
Agent, in its sole reasonable discretion, as the rate that would have been
established had a Remarketing been held on the Remarketing Date.

     (h)  If, by 4:00 p.m., New York City time, on the Remarketing Date, the
Remarketing Agent is unable to remarket all of the Preferred Securities tendered
or deemed tendered for purchase, a failed Remarketing ("Failed Remarketing")
shall be deemed to have occurred and the Remarketing Agent shall so advise by
telephone the Depositary, the Property Trustee, the Indenture Trustee, the Trust
and the Sponsor. In the event of a Failed Remarketing, the Reset Rate shall
equal the Two-Year Benchmark Treasury Rate plus the Applicable Spread; PROVIDED,
HOWEVER, that if the Two-Year Benchmark Treasury Rate is not displayed in the
Telerate system, the Reset Rate shall be calculated by the Remarketing Agent as
the yield to maturity of the Preferred Securities, expressed as a bond
equivalent on the basis of a year of 365 or 366 days, as applicable, and applied
on a daily basis, and computed by taking the arithmetic mean of the secondary
market bid rates, as of 10:30 a.m., New York City time, on the third Business
Day prior to the Purchase Contract Settlement Date of three leading United
States government securities dealers selected by the Remarketing Agent (after
consultation with the Sponsor), which may include the Remarketing Agent or an
Affiliate thereof. Whether or not there has been a Failed Remarketing will be
determined in the sole reasonable discretion of the Remarketing Agent.

     (i)  By approximately 4:30 p.m., New York City time, on the Remarketing
Date PROVIDED that there has not been a Failed Remarketing, the Remarketing
Agent shall advise, by telephone (i) the Depositary, the Property Trustee, the
Trust and the Sponsor of the Reset Rate determined in the Remarketing and the
number of Preferred Securities sold in the Remarketing, (ii) each purchaser (or
the Depositary Participant thereof) purchasing Preferred Securities sold in the
Remarketing of the Reset Rate and the number of Preferred Securities such
purchaser is to purchase and (iii) each purchaser to give instructions to its
Depositary Participant to pay the purchase price on the Purchase Contract
Settlement Date in same day funds against delivery of the Preferred Securities
purchased through the facilities of the Depositary.

     (j)  In accordance with the Depositary's normal procedures, on the
Remarketing Settlement Date, the transactions described above with respect to
each Preferred Security tendered for purchase and sold in the Remarketing shall
be executed through the Depositary, and the accounts of the respective
Depositary Participants shall be debited and credited and such Preferred
Securities delivered by book-entry as necessary to effect purchases and sales of
such Preferred Securities. The Depositary shall make payment in accordance with
its normal procedures.

     (k)  If any Holder of the Preferred Securities selling Preferred Securities
in the Remarketing fails to deliver such Preferred Securities, the Depositary
Participant of such selling Holder and of any other Person that was to have
purchased Preferred Securities in the Remarketing may deliver to any such other
Person a number of Preferred Securities that is less

                                       52


than the number of Preferred Securities that otherwise was to be purchased by
such Person. In such event, the number of Preferred Securities to be so
delivered shall be determined by such Depositary Participant, and delivery of
such lesser number of Preferred Securities shall constitute good delivery.

     (l)  The Remarketing Agent shall not have any obligation whatsoever to
purchase any Preferred Securities, whether in the Remarketing or otherwise, and
shall in no way be obligated to provide funds to make payment upon tender of
Preferred Securities for Remarketing or to otherwise expend or risk its own
funds or incur or to be exposed to financial liability in the performance of its
duties under this Agreement, and without limitation of the foregoing, the
Remarketing Agent shall not be deemed an underwriter of the Preferred
Securities. None of the Trust, any Trustee, the Sponsor or the Remarketing Agent
shall be obligated in any case to provide funds to make payment upon tender of
the Preferred Securities for Remarketing.

     (m)  Under the Remarketing Agreement, the Sponsor, in its capacity as
[Subordinated] Notes Issuer, shall be liable for, and shall pay, any and all
costs and expenses incurred in connection with the Remarketing, and the Trust
shall not have any liabilities for such costs and expenses; PROVIDED, HOWEVER,
that for the performance of its services, the Remarketing Agent will retain from
the proceeds of the Remarketing an amount equal to [0.25]% of the aggregate
stated liquidation amount of all remarketed Preferred Securities.

     (n)  The tender and settlement procedures set in this Section 7.13,
including provisions for payment by purchasers of the Preferred Securities in
the Remarketing, shall be subject to modification to the extent required by the
Depositary or if the book-entry system is no longer available for the Preferred
Securities at the time of the Remarketing, to facilitate the tendering and
remarketing of the Preferred Securities in certificated form. In addition, the
Remarketing Agent may modify the settlement procedures set forth herein in order
to facilitate the settlement process.

                                    ARTICLE 8
                    DISSOLUTION AND TERMINATION OF THE TRUST

     Section 8.01.  DISSOLUTION AND TERMINATION OF THE TRUST.

     (a)  The Trust shall dissolve upon the earliest of:

             (i)  the bankruptcy or liquidation of the [Subordinated] Notes
     Issuer;

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

           (iii)  the entry of a decree of judicial dissolution of the Sponsor
     or the Trust;

                                       53


            (iv)  the time when all of the Securities shall have been called for
     redemption at maturity or upon the occurrence of a Tax Event and the
     amounts then due shall have been paid to the Holders of the Securities;

             (v)  the direction by the Property Trustee, following the
     occurrence and continuation of a Tax Event pursuant to which the Trust is
     to be dissolved and all of the [Subordinated] Notes distributed to the
     Holders of the Securities in exchange for all of the Securities;

            (vi)  at the Sponsor's sole discretion, by notice and direction to
     the Property Trustee to distribute the [Subordinated] Notes to the Holders
     of the Securities in exchange for all of the Securities; PROVIDED that the
     Sponsor will be required to obtain an opinion of counsel that the
     distribution of the [Subordinated] Notes will not be taxable to the holders
     of the Preferred Securities for United States federal income tax purposes;
     and

           (vii)  the time when all of the Administrative Trustees and the
     Sponsor have consented to dissolution of the Trust, PROVIDED such action is
     taken before the issuance of any Securities.

     (b)  As soon as is practicable after the occurrence of an event referred to
in Section 8.01(a) and upon completion of the winding up and liquidation of the
Trust in accordance with Section 3808(e) of the Statutory Trust Act, the
Administrative Trustees shall terminate the Trust by executing and filing a
certificate of cancellation with the Secretary of State of the State of Delaware
in accordance with Section 3810 of the Statutory Trust Act.

     (c)  The provisions of Article 9 shall survive the termination of the
Trust.

     Section 8.02.  LIQUIDATION DISTRIBUTION UPON DISSOLUTION OF THE TRUST.

     (a)  In the event of any voluntary or involuntary liquidation, dissolution,
or winding-up of the Trust based on the occurrence of an event specified in
Section 8.01(a) (other than clause (iv)) (each a "Liquidation"), the Holders of
the Securities on the date of the Liquidation shall be entitled to receive on a
Pro Rata basis, after satisfaction of the Trust's liabilities to creditors in
accordance with Section 3808(e) of the Statutory Trust Act, [Subordinated] Notes
in an aggregate principal amount equal to the aggregate stated liquidation
amount of, with an interest rate identical to the distribution rate of, and
accrued and unpaid interest equal to accumulated and unpaid Distributions on,
such Securities in exchange for such Securities; PROVIDED if the Liquidation
occurs prior to the Purchase Contract Settlement Date, the [Subordinated] Notes
receivable by the Holders shall be transferred to the Collateral Agent.

     (b)  Notice of Liquidation shall be given by the Property Trustee by
first-class mail, postage prepaid, mailed not later than 30 nor more than 60
days prior to the date of the Liquidation to each Holder of Securities at such
Holder's address appearing in the Securities register. All notices of
Liquidation shall:

             (i)  state the date of the Liquidation;

                                       54


            (ii)  state that from and after the date of the Liquidation, the
     Securities will no longer be deemed to be outstanding and any Certificates
     not surrendered for exchange will be deemed to represent the [Subordinated]
     Notes in a principal amount equal to the stated liquidation amount of the
     Securities, bearing accrued and unpaid interest in an amount equal to the
     accumulated and unpaid Distribution on the Securities; and

           (iii)  provide such information with respect to the mechanics by
     which Holders may exchange Certificates for [Subordinated] Notes, or, if
     Section 8.02(d) applies, receive a distribution, as the Property Trustee
     shall deem appropriate.

     (c)  Except where Section 8.01(a)(iv) or Section 8.02(d) applies, in order
to effect the liquidation of the Trust and distribution of the [Subordinated]
Notes to Holders, the Property Trustee shall establish a record date for such
distribution (which shall be not more than 45 days prior to the date of the
Liquidation) and, either itself acting as exchange agent or through the
appointment of a separate exchange agent, shall establish such procedures as it
shall deem appropriate to effect the distribution of [Subordinated] Notes in
exchange for the outstanding Certificates.

     (d)  In the event that, notwithstanding the other provisions of this
Section 8.02, whether because of an order for dissolution entered by a court of
competent jurisdiction or otherwise, distribution of the [Subordinated] Notes in
the manner provided herein is determined by the Property Trustee not to be
practical, the property of the Trust shall be liquidated, and the Trust shall be
wound-up and terminated, by the Property Trustee in such manner as the Property
Trustee reasonably determines. In such event, on the date of the winding-up and
termination of the Trust, the Holders of the Securities on the date of the
Liquidation shall be entitled to receive, out of the assets of the Trust
available for distribution to the Holders of the Securities after satisfaction
of the Trust's liabilities to creditors in accordance with Section 3808(e) of
the Statutory Trust Act, if any, cash or other immediately available funds in an
amount equal to the aggregate of the stated liquidation amount of $25 per
Security plus accumulated and unpaid Distributions thereon to the date of
payment (such amount being the "Liquidation Distribution"); PROVIDED that if the
Liquidation occurs prior to the Purchase Contract Settlement Date, the
Liquidation Distribution shall equal the Redemption Amount attributable to an
aggregate principal amount of [Subordinated] Notes equal to the aggregate stated
liquidation amount of the Securities plus any accumulated and unpaid
Distributions, and such Liquidation Amount will be distributed to the
Collateral Agent, which in turn will apply an amount equal to the Redemption
Amount of such Liquidation Distribution to purchase the Treasury Portfolio on
behalf of the Holders of the Securities and remit the remaining portion, if any,
of such Liquidation Distribution to the Purchase Contract Agent for payment to
the Holders. If, upon any such Liquidation, the Liquidation Distribution can be
paid only in part because the Trust has insufficient assets available to pay the
aggregate Liquidation Distribution in full, then the amounts payable directly by
the Trust on the Securities shall be paid on a Pro Rata basis. The Holders of
the Common Securities shall be entitled to receive the Liquidation Distribution
Pro Rata with the Holders of the Preferred Securities, except that if a Trust
Enforcement Event has occurred and is continuing, then the Preferred Securities
shall have a preference over the Common Securities with regard to the
Liquidation Distribution.

                                       55


     (e)  After the date fixed for any distribution of [Subordinated] Notes upon
dissolution of the Trust, (i) the Securities no longer shall be deemed to be
outstanding and (ii) the Certificates shall be deemed to represent the
[Subordinated] Notes in a principal amount equal to the stated liquidation
amount of the Securities, bearing accrued and unpaid interest in an amount equal
to the accumulated and unpaid Distributions on the Securities, until such
Certificates are presented to the Administrative Trustees or agent for transfer
or reissuance.

                                    ARTICLE 9
 LIMITATION OF LIABILITY OF HOLDERS OF THE SECURITIES, THE DELAWARE TRUSTEE AND
                                     OTHERS

     Section 9.01.  LIABILITY.

     (a)  Except as expressly set forth in this Declaration and the Guarantee,
the Sponsor and the Trustees:

             (i)  shall not be personally liable for the return of any portion
     of the capital contributions (or any return thereon) of the Holders of the
     Securities that will be made solely from assets of the Trust; and

            (ii)  shall not be required to pay to the Trust or to any Holder of
     the Securities any deficit, upon dissolution of the Trust or otherwise.

     (b)  Pursuant to Section 3803(a) of the Statutory Trust Act, the Holder of
the Common Securities shall be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware; PROVIDED that the
Holders of the Common Securities shall be liable for all of the debts and
obligations of the Trust (other than with respect to the Securities) to the
extent such debts and obligations are not satisfied out of the Trust's assets.

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

     Section 9.02.  EXCULPATION.

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

                                       56


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

     Section 9.03.  FIDUCIARY DUTY.

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

     (b)  Unless otherwise expressly provided herein:

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

            (ii)  whenever this Declaration or any other agreement contemplated
     herein or therein provides that an Indemnified Person shall act in a manner
     that is, or provides terms that are, fair and reasonable to the Trust or
     any Holder of Securities,

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

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

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

                                       57


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

     Section 9.04.  INDEMNIFICATION.

     (a)  To the fullest extent permitted by applicable law, the Sponsor, in its
capacity as [Subordinated] Notes Issuer, shall indemnify and hold harmless each
Indemnified Person from and against any loss, damage or claim incurred by such
Indemnified Person by reason of any act or omission performed or omitted by such
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of authority
conferred on such Indemnified Person by this Declaration, except that no
Indemnified Person shall be entitled to be indemnified in respect of any loss,
damage or claim incurred by such Indemnified Person by reason of gross
negligence (or, in the case of the Property Trustee, negligence) or willful
misconduct with respect to such acts or omissions.

     (b)  The provisions of this Section 9.04 shall survive the termination of
this Declaration or the resignation or removal of any Trustee.

     (c)  The Sponsor or the Trust may purchase and maintain insurance on behalf
of any Person who is or was an Indemnified Person against any liability asserted
against him or her and incurred by him or her in any such capacity, or arising
out of his or her status as such, whether or not the Sponsor would have the
power to indemnify him or her against such liability under the provisions of
this Section 9.04.

     (d)  For purposes of this Section 9.04, references to "the Trust" shall
include, in addition to the resulting or surviving entity, any constituent
entity (including any constituent of a constituent) absorbed in a consolidation
or merger, so that any Person who is or was a director, trustee, officer or
employee of such constituent entity, or is or was serving at the request of such
constituent entity as a director, trustee, officer, employee or agent of another
entity, shall stand in the same position under the provisions of this Section
9.04 with respect to the resulting or surviving entity as he or she would have
had with respect to such constituent entity if its separate existence had
continued.

     (e)  The indemnification and advancement of expenses provided by, or
granted pursuant to, this Section 9.04 shall continue, unless otherwise provided
when authorized or ratified, as to a Person who has ceased to be an Indemnified
Person and shall inure to the benefit of the heirs, executors and administrators
of such a Person.

     Section 9.05.  OUTSIDE BUSINESSES.

     Any Covered Person, the Sponsor, the Delaware Trustee and the Property
Trustee (subject to Section 6.03(c)) may engage in or possess an interest in
other business ventures of any nature or description, independently or with
others, similar or dissimilar to the activities of the Trust, and the Trust and
the Holders of the Securities shall have no rights by virtue of this Declaration
in and to such independent ventures or the income or profits derived therefrom,
and the pursuit of any such venture, even if competitive with the activities of
the Trust, shall not be deemed wrongful or improper. Each Covered Person, the
Sponsor, the Delaware Trustee and the

                                       58


Property Trustee shall not be obligated to present any particular investment or
other opportunity to the Trust even if such opportunity is of a character that,
if presented to the Trust, could be taken by the Trust, and any Covered Person,
the Sponsor, the Delaware Trustee and the Property Trustee shall have the right
to take for its own account (individually or as a partner or fiduciary) or to
recommend to others any such particular investment or other opportunity. Any
Covered Person, the Delaware Trustee and the Property Trustee may engage or be
interested in any financial or other transaction with the Sponsor or any
Affiliate of the Sponsor, or may act as depositary for, trustee or agent for, or
act on any committee or body of holders of, securities or other obligations of
the Sponsor or its Affiliates.

                                   ARTICLE 10
                                   ACCOUNTING

     Section 10.01.  FISCAL YEAR.

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

     Section 10.02.  CERTAIN ACCOUNTING MATTERS.

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

     (b)  The Administrative Trustees and the Sponsor shall cause to be prepared
and delivered to each Holder of Securities, within 90 days after the end of each
Fiscal Year of the Trust, annual financial statements of the Trust, including a
balance sheet of the Trust as of the end of such Fiscal Year, and the related
statements of income or loss.

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

     (d)  The Administrative Trustees and the Sponsor shall cause to be duly
prepared and filed with the appropriate taxing authority an annual United States
federal income tax return, on Form 1041 or such other form required by United
States federal income tax law, and any other

                                       59


annual income tax returns required to be filed on behalf of the Trust with any
state or local taxing authority.

     Section 10.03.  BANKING.

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

     Section 10.04.  WITHHOLDING.

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

                                   ARTICLE 11
                             AMENDMENTS AND MEETINGS

     Section 11.01.  AMENDMENTS.

     (a)  Except as otherwise provided in this Declaration or by any applicable
terms of the Securities, this Declaration may be amended only by a written
instrument approved and executed by the Sponsor and (i) the Administrative
Trustees (or, if there are more than two Administrative Trustees, a majority of
the Administrative Trustees) and (ii) the Property Trustee (if the amendment
affects the rights, powers, duties, obligations or immunities of the Property
Trustee) and (iii) by the Delaware Trustee (if the amendment affects the rights,
powers, duties, obligations or immunities of the Delaware Trustee).

     (b)  No amendment shall be made, and any such purported amendment shall be
void and ineffective:

                                       60


             (i)  unless, in the case of any proposed amendment, the Property
     Trustee first has received an Officers' Certificate from each of the Trust
     and the Sponsor that such amendment is permitted by, and conforms to, the
     terms of this Declaration (including the terms of the Securities);

            (ii)  unless, in the case of any proposed amendment that affects the
     rights, powers, duties, obligations or immunities of the Property Trustee,
     the Property Trustee first has received an opinion of counsel (which may be
     counsel to the Sponsor or the Trust) that such amendment is permitted by,
     and conforms to, the terms of this Declaration (including the terms of the
     Securities); and

           (iii)  to the extent the result of such amendment would be to

                    (A) cause the Trust to be classified other than as a grantor
             trust for United States federal income tax purposes;

                    (B) reduce or otherwise adversely affect the powers of the
             Property Trustee in contravention of the Trust Indenture Act; or

                    (C) cause the Trust to be deemed to be an Investment Company
             required to be registered under the Investment Company Act.

     (c)  At such time after the Trust has issued any Securities that remain
outstanding, (i) any amendment that would (A) adversely affect the powers,
preferences or special rights of the Securities, whether by way of amendment to
this Declaration or otherwise or (B) result in the dissolution, winding-up or
termination of the Trust other than pursuant to the terms of this Declaration
shall not be effective except with the approval of the Holders of at least a 66
2/3% in Liquidation Amount of the Securities; PROVIDED that if any amendment or
proposal referred to in clause (A) above would adversely affect only the
Preferred Securities or the Common Securities, then only the affected class will
be entitled to vote on such amendment or proposal, and such amendment or
proposal shall not be effective except with the approval of a 66 2/3% in
Liquidation Amount of the class of Securities affected thereby; and (ii) any
amendment that would (X) change the amount or timing of any distribution on the
Securities or otherwise adversely affect the amount of any distribution required
to be made in respect of the Securities as of a specified date or (Y) restrict
the right of a Holder to institute suit for the enforcement of such payment on
or after such date shall not be effective except with the approval of each
Holder of Securities affected thereby.

     (d)  This Section 11.01 shall not be amended without the consent of all of
the Holders of the Securities.

     (e)  Article 4 shall not be amended without the consent of the Holders of
the Common Securities.

     (f)  The rights of the Holders of the Common Securities under Articles 6
and 7 to increase or decrease the number of, and appoint and remove, Trustees
shall not be amended without the consent of the Holders of the Common
Securities.

                                       61


     (g)  Notwithstanding Section 11.01(c), this Declaration may be amended
without the consent of the Holders of the Securities, PROVIDED that such
amendment does not have a material adverse effect on the rights, preferences or
privileges of the Holders of the Securities:

             (i)  to cure any ambiguity;

            (ii)  to correct or supplement any provision in this Declaration
     that may be defective or inconsistent with any other provision of this
     Declaration;

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

            (iv)  to conform to changes in, or a change in interpretation or
     application by any legislative body, court, government agency or regulatory
     authority of regulations relating to whether the Trust is required to be
     registered as an investment company under the Investment Company Act;

             (v)  to modify, eliminate and add to any provision of this
     Declaration to ensure that the Trust will be classified as a grantor trust
     for United States federal income tax purposes at all times that any
     Securities are outstanding or to ensure that the Trust will not be required
     to register as an Investment Company under the Investment Company Act;
     PROVIDED that such modification, elimination or addition would not
     adversely affect in any material respect the rights, privileges or
     preferences of any Holder of Securities; or

            (vi)  to facilitate the tendering, remarketing and settlement of the
     Preferred Securities as contemplated by Section 7.13(n).

     Section 11.02.  MEETINGS OF THE HOLDERS OF THE SECURITIES; ACTION BY
WRITTEN CONSENT.

     (a)  Meetings of the Holders of any class of Securities may be called at
any time by the Administrative Trustees (or as provided in the terms of the
Securities) to consider and act on any matter on which Holders of such class of
Securities are entitled to act under the terms of this Declaration or the rules
of any stock exchange on which the Preferred Securities are listed or admitted
for trading. The Administrative Trustees shall call a meeting of the Holders of
such class if directed to do so by the Holders of at least 10% in Liquidation
Amount of such class of Securities. Such direction shall be given by delivering
to the Administrative Trustees a writing stating that the signing Holders of the
Securities wish to call a meeting and indicating the general or-specific purpose
for which the meeting is to be called. The Holder or Holders of the Securities
calling a meeting shall specify in writing the Certificates held by such Holder
or Holders, and only those Securities specified shall be counted for purposes of
determining whether the required percentage set forth in the second sentence of
this paragraph has been met. The Administrative Trustees shall cause a notice of
any meeting at which Holders of the Preferred Securities are entitled to vote to
be mailed to each Holder of record of Preferred Securities. Each such notice
shall include a statement setting forth: (i) the date of such meeting; (ii) a
description of any resolution proposed for adoption at such meeting on which
such Holders are entitled to vote; and (iii) instructions for the delivery of
proxies.

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

                                       62


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

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

           (iii)  Each meeting of the Holders of the Securities shall be
     conducted by the Administrative Trustees or by such other Person that the
     Administrative Trustees may designate.

            (iv)  Unless the Statutory Trust Act, this Declaration, the Trust
     Indenture Act or the listing rules of any stock exchange on which the
     Preferred Securities are then listed for trading otherwise provides, the
     Administrative Trustees, in their sole discretion, shall establish all
     other provisions relating to meetings of Holders of the Securities,
     including notice of the time, place or purpose of any meeting at which any
     matter is to be voted on by any Holders of the Securities, waiver of any
     such notice, action by consent without a meeting without prior notice, the
     establishment of a record date, quorum requirements, voting in person or by
     proxy or any other matter with respect to the exercise of any such right to
     vote.

                                       63


                                   ARTICLE 12
        REPRESENTATIONS OF THE PROPERTY TRUSTEE AND THE DELAWARE TRUSTEE

     Section 12.01.  REPRESENTATIONS AND WARRANTIES OF THE PROPERTY TRUSTEE.

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

     (a)  the Property Trustee is a corporation or national banking association
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or organization, with trust power and
authority to execute and deliver, and to carry out and perform its obligations
under the terms of, this Declaration;

     (b)  the Property Trustee satisfies the requirements set forth in Section
6.03(a);

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

     (d)  the execution, delivery and performance of this Declaration by the
Property Trustee do not conflict with, nor constitute a breach of, the articles
of association or incorporation, as the case may be, or the by-laws (or other
similar organizational documents) of the Property Trustee; and

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

     Section 12.02.  REPRESENTATIONS AND WARRANTIES OF THE DELAWARE TRUSTEE.

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

     (a)  the Delaware Trustee satisfies the requirements set forth in Section
6.02 and has the power and authority to execute and deliver, and to carry out
and perform its obligations under the terms of, this Declaration and, if it is
not a natural person, is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation or
organization;

                                       64


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

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

                                   ARTICLE 13
                                  MISCELLANEOUS

     Section 13.01.  NOTICES.

     All notices provided for in this Declaration shall be in writing, duly
signed by the party giving such notice, and shall be delivered, telecopied or
mailed by registered or certified mail, as follows:

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

             CC Funding Trust II
             c/o Cinergy Corp.
             139 East Fourth Street
             Cincinnati, OH 45202
             Attention:
             Telephone No:
             Fax No:

             with a copy to:

             [                      ]

                                       65


     (b)  if given to the Delaware Trustee, at the mailing address set forth
below (or such other address as the Delaware Trustee may give notice of to the
Administrative Trustees, the Property Trustee and the Holders of the
Securities):

             [                      ]
             [                      ]
             [                      ]
             Attention:
             Telephone No:
             Fax No:

     (c)  if given to the Property Trustee, at its Corporate Trust Office to the
attention of Corporate Trust Department (telephone no. ___________ and fax no.
___________) (or such other address as the Property Trustee may give notice of
to the Administrative Trustees, the Delaware Trustee and the Holders of the
Securities);

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

          Cinergy Corp.
          139 East Fourth Street
          Cincinnati, OH 45202
          Attention:
          Telephone No:
          Fax No:

          with a copy to:

          [                      ]

     (e)  if given to any Holder of Preferred Securities, at such Holder's
address as set forth in the register of the Trust.

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

     Section 13.02.  GOVERNING LAW.

     This Declaration and the rights of the parties hereunder shall be governed
by and interpreted in accordance with the laws of the State of Delaware, without
regard to principles of conflicts of laws.

                                       66


     Section 13.03.  INTENTION OF THE PARTIES.

     It is the intention of the parties hereto that the Trust be classified for
United States federal income tax purposes as a grantor trust. The provisions of
this Declaration shall be interpreted in a manner consistent with such
classification.

     Section 13.04.  HEADINGS.

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

     Section 13.05.  SUCCESSORS AND ASSIGNS.

     Whenever in this Declaration any of the parties hereto is named or referred
to, the successors and assigns of such party shall be deemed to be included, and
all covenants and agreements in this Declaration by the Sponsor and the Trustee
shall bind and inure to the benefit of their respective successors and assigns,
whether so expressed.

     Section 13.06.  PARTIAL ENFORCEABILITY.

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

     Section 13.07.  COUNTERPARTS.

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

                                       67


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

                                 CINERGY CORP.,
                                 as Sponsor, [Subordinated] Notes Issuer and
                                 Common Securities Holder

                                 By:
                                     -------------------------------------------
                                      Name:
                                      Title:

                                 [                                ],
                                 as Property Trustee

                                 By:
                                     -------------------------------------------
                                      Name:
                                      Title:

                                 [                                ],
                                 as Delaware Trustee

                                 By:
                                     -------------------------------------------
                                      Name:
                                      Title:


                                 -----------------------------------------------
                                 [                          ], as Administrative
                                 Trustee


                                 -----------------------------------------------
                                 [                          ], as Administrative
                                 Trustee


                                 -----------------------------------------------
                                 [                          ], as Administrative
                                 Trustee



                                    EXHIBIT A

     [This Preferred Security is registered in the name of The Depository Trust
Company, a New York corporation (the "Depositary"), or a nominee of the
Depositary. This Preferred Security is exchangeable for Preferred Securities
registered in the name of a person other than the Depositary or its nominee only
in the limited circumstances described in the Declaration, and no transfer of
this Preferred Security (other than a transfer of this Preferred Security as a
whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary) may be
registered, except in limited circumstances.

     Unless this Global Certificate is presented by an authorized representative
of the Depositary to the issuer or its agent for registration of transfer,
exchange or payment, and any Preferred Security Certificate issued is registered
in the name of Cede & Co. or such other name as registered by an authorized
representative of the Depositary (and any payment hereon is made to Cede & Co.
or to such other entity as is requested by an authorized representative of the
Depositary), and except as otherwise provided in the Amended and Restated
Declaration of CC Funding Trust II dated ___________, 2003, ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON (OTHER THAN
PURSUANT TO THE PLEDGE AGREEMENT) IS WRONGFUL, since the registered owner
hereof, Cede & Co., has an interest herein.]

Certificate No. _________            Number of Preferred Securities: ___________
CUSIP No.                            Aggregate Liquidation Amount:  $___________

                   Certificate Evidencing Preferred Securities
                                       of
                               CC Funding Trust II

                              Preferred Securities
                 (liquidation amount $25 per Preferred Security)

     CC Funding Trust II, a statutory trust created under the laws of the State
of Delaware (the "Trust"), hereby certifies that ____________ (the "Holder") is
the registered owner of ___ preferred securities of the Trust representing
undivided beneficial interests in the assets of the Trust designated the
Preferred Securities (liquidation amount $25.00 per Preferred Security) (the
"Preferred Securities"). The Preferred Securities are transferable on the
register of the Trust, in person or by a duly authorized attorney, upon
surrender of this certificate duly endorsed and in proper form for transfer as
provided in the Declaration (as defined below). The designation, rights,
privileges, restrictions, preferences and other terms and provisions of the
Preferred Securities represented hereby are issued and shall in all respects be
subject to the provisions of the Amended and Restated Declaration of Trust of
the Trust, dated as of ___________, 2003 (as the same may be amended from time
to time, the "Declaration"), among Cinergy Corp., as Sponsor, [             ],
[             ] and [             ], as Administrative Trustees, [            ],
as Property Trustee, [             ], as Delaware Trustee, and the holders from
time to time, of undivided beneficial interests in the assets of the Trust.
Capitalized terms used

                                       A-1


herein but not defined shall have the meaning given them in the Declaration. The
Holder is entitled to the benefits of the Guarantee Agreement, dated as of
___________, 2003, as the same may be amended from time to time, of Cinergy
Corp., in respect of the Preferred Securities. The Sponsor will provide a copy
of the Declaration, the Guarantee and the Indenture to a Holder without charge
upon written request to the Sponsor at its principal place of business.

     Upon receipt of this certificate, the Holder is bound by the terms of the
Declaration and is entitled to the benefits thereunder.

     By acceptance, the Holder agrees to treat, for United States federal income
tax purposes, the [Subordinated] Notes as indebtedness of the Sponsor and the
Preferred Securities as evidence of undivided beneficial interests in the
[Subordinated] Notes.

                                       A-2


     IN WITNESS WHEREOF, the Trust has executed this certificate this ____ day
of _________, 2003.

                                 CC FUNDING TRUST II


                                 -----------------------------------------------
                                 By:
                                     -------------------------------------------
                                      Administrative Trustee

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

                                 [                                ], as
                                 Property Trustee


                                 -----------------------------------------------
                                 By:
                                     -------------------------------------------
                                 Title:
                                       -----------------------------------------

                                       A-3


                                    EXHIBIT B

           THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT AS PROVIDED IN
                       THE DECLARATION (AS DEFINED BELOW)

Certificate No.______                      Number of Common Securities: ________
                                           Aggregate Liquidation Amount: $______

                    Certificate Evidencing Common Securities
                                       of
                               CC Funding Trust II

                                Common Securities
                  (liquidation amount $25 per Common Security)

     CC Funding Trust II, a statutory trust created under the laws of the State
of Delaware (the "Trust"), hereby certifies that Cinergy Corp. (the "Holder") is
the registered owner of _________________ common securities of the Trust
representing an undivided beneficial interest in the assets of the Trust
designated the Common Securities (liquidation amount $25.00 per Common Security)
(the "Common Securities"). Except as provided in the Declaration (as defined
below), the Common Securities are not transferable, and any attempted transfer
thereof shall be void. The designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Common Securities represented
hereby are issued and shall in all respects be subject to the provisions of the
Amended and Restated Declaration of Trust of the Trust, dated as of ___________,
2003 (as the same may be amended from time to time, the "Declaration"), among
Cinergy Corp., as Sponsor, [             ], [             ] and [
                 ], as Administrative Trustees, [              ], as Property
Trustee, [              ], as Delaware Trustee, and the holders, from time to
time, of undivided beneficial interests in the assets of the Trust. The Sponsor
will provide a copy of the Declaration and the Indenture to the Holder without
charge upon written request to the Sponsor at its principal place of business.

     Upon receipt of this certificate, the Holder is bound by the terms of the
Declaration and is entitled to the benefits thereunder.

     By acceptance, the Holder agrees to treat, for United States federal income
tax purposes, the [Subordinated] Notes as indebtedness of the Sponsor and the
Common Securities as evidence of an undivided beneficial interest in the
[Subordinated] Notes.



     IN WITNESS WHEREOF, the Trust has executed this certificate this ______ day
of ___________, 2003.

                                 CC FUNDING TRUST II


                                 -----------------------------------------------
                                 By:
                                     -------------------------------------------
                                Administrative Trustee

                                       B-2

EX-4.6

                                                                     EXHIBIT 4.6


                              CERTIFICATE OF TRUST
                                       OF
                               CC FUNDING TRUST II


     THIS CERTIFICATE OF TRUST of CC Funding Trust II (the "TRUST"), dated as of
January 9, 2003, is being duly executed and filed by the undersigned, as
trustees, with the Secretary of State of the State of Delaware to form a
statutory trust under the Delaware Statutory Trust Act (12 DEL. CODE SECTION
3801 et seq.).

     1.   NAME. The name of the statutory trust being formed hereby is "CC
          Funding Trust II."

     2.   DELAWARE TRUSTEE. The name and business address of the trustee of the
          Trust with a principal place of business in the State of Delaware are
          as follows: The Bank of New York (Delaware), 700 White Clay Center,
          Route 273, Newark, DE 19711.

     3.   EFFECTIVE DATE. This Certificate of Trust shall be effective at the
          time of its filing with the Secretary of State of the State of
          Delaware.

     4.   COUNTERPARTS. This Certificate of Trust may be executed in one or more
          counterparts.


                           [SIGNATURE PAGE TO FOLLOW]



     IN WITNESS WHEREOF, the undersigned, being all of the trustees of the Trust
at the time of filing of this Certificate of Trust, have executed this
Certificate of Trust as of the date first above written.


                                        THE BANK OF NEW YORK
                                         (DELAWARE).
                                        as Delaware Trustee


                                        By: /s/ William T. Lewis
                                            --------------------
                                            Name: William T. Lewis
                                            Title: Senior Vice President


                                        THE BANK OF NEW YORK
                                        as Property Trustee


                                        By: /s/ Paul J. Schmalzel
                                            ---------------------
                                            Name: Paul J. Schmalzel
                                            Title: Vice President


                                        WENDY L. AUMILLER,
                                        as Administrative Trustee


                                        By: /s/ Wendy L. Aumiller
                                            ---------------------

EX-4.8

                                                                     EXHIBIT 4.8


                                  CINERGY CORP.

                               GUARANTEE AGREEMENT

                               CC FUNDING TRUST II


                         Dated as of ____________, 2003



                                TABLE OF CONTENTS
                                -----------------



                                                                                PAGE
                                                                                ----
                                                                               
                                    ARTICLE 1
                                   DEFINITIONS

SECTION 1.01.  DEFINITIONS.........................................................1

                                    ARTICLE 2
                               TRUST INDENTURE ACT

SECTION 2.01.  TRUST INDENTURE ACT; APPLICATION....................................5
SECTION 2.02.  LISTS OF HOLDERS OF PREFERRED SECURITIES............................6
SECTION 2.03.  REPORTS BY THE GUARANTEE TRUSTEE....................................6
SECTION 2.04.  PERIODIC REPORTS TO THE GUARANTEE TRUSTEE...........................6
SECTION 2.05.  EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT....................7
SECTION 2.06.  EVENTS OF DEFAULT; WAIVER...........................................7
SECTION 2.07.  DISCLOSURE OF INFORMATION...........................................7
SECTION 2.08.  CONFLICTING INTEREST................................................7

                                    ARTICLE 3
               POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE

SECTION 3.01.  POWERS AND DUTIES OF THE GUARANTEE TRUSTEE..........................8
SECTION 3.02.  CERTAIN RIGHTS AND DUTIES OF THE GUARANTEE TRUSTEE..................9
SECTION 3.03.  NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF GUARANTEE..............11
SECTION 3.04.  THE GUARANTEE TRUSTEE MAY OWN PREFERRED SECURITIES.................11
SECTION 3.05.  MONEYS RECEIVED BY THE GUARANTEE TRUSTEE TO BE HELD IN TRUST
      WITHOUT INTEREST............................................................12
SECTION 3.06.  COMPENSATION AND EXPENSES OF GUARANTEE TRUSTEE.....................12

                                    ARTICLE 4
                                GUARANTEE TRUSTEE

SECTION 4.01.  QUALIFICATIONS.....................................................12
SECTION 4.02.  APPOINTMENT, REMOVAL AND RESIGNATION OF THE GUARANTEE TRUSTEE......13


                                        i




                                                                                PAGE
                                                                                ----
                                                                               
                                    ARTICLE 5
                                    GUARANTEE

SECTION 5.01.  GUARANTEE..........................................................14
SECTION 5.02.  WAIVER OF NOTICE...................................................14
SECTION 5.03.  OBLIGATIONS NOT AFFECTED...........................................15
SECTION 5.04.  ENFORCEMENT OF GUARANTEE...........................................16
SECTION 5.05.  GUARANTEE OF PAYMENT...............................................16
SECTION 5.06.  SUBROGATION........................................................16
SECTION 5.07.  INDEPENDENT OBLIGATIONS............................................17

                                    ARTICLE 6
                    LIMITATION OF TRANSACTIONS; SUBORDINATION

SECTION 6.01.  LIMITATION OF TRANSACTIONS.........................................17
SECTION 6.02.  SUBORDINATION......................................................18

                                    ARTICLE 7
                                   TERMINATION

SECTION 7.01.  TERMINATION........................................................18

                                    ARTICLE 8
                    LIMITATION OF LIABILITY; INDEMNIFICATION

SECTION 8.01.  EXCULPATION........................................................18
SECTION 8.02.  INDEMNIFICATION....................................................19
SECTION 8.03.  SURVIVE TERMINATION................................................19


                                       ii




                                                                                PAGE
                                                                                ----
                                                                               
                                    ARTICLE 9
                                  MISCELLANEOUS

SECTION 9.01.  SUCCESSORS AND ASSIGNS.............................................19
SECTION 9.02.  AMENDMENTS.........................................................20
SECTION 9.03.  NOTICES............................................................20
SECTION 9.04.  GENDERS............................................................21
SECTION 9.05.  BENEFIT............................................................21
SECTION 9.06.  GOVERNING LAW......................................................21
SECTION 9.07.  COUNTERPARTS.......................................................21
SECTION 9.08.  INTENTIONALLY OMITTED..............................................21
SECTION 9.09.  LIMITED LIABILITY..................................................21


                                       iii


                               GUARANTEE AGREEMENT

     This GUARANTEE AGREEMENT, dated as of _________, 2003, is executed and
delivered by CINERGY CORP., a Delaware corporation (the "GUARANTOR"), and THE
BANK OF NEW YORK, a New York banking corporation, as the initial Guarantee
Trustee (as defined herein) for the benefit of the Holders (as defined herein)
from time to time of the Preferred Securities (as defined herein) of CC Funding
Trust II, a Delaware statutory trust (the "ISSUER").

     WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the
"DECLARATION"), dated as of ___________, 2003 among the trustees of the Issuer
named therein, Cinergy Corp., as Sponsor, and the Holders from time to time of
preferred undivided beneficial interests in the assets of the Issuer, the Issuer
may issue $___________ [($___________ if the over-allotment option granted in
the Underwriting Agreement (as defined herein) is exercised in full)] aggregate
liquidation amount of its Preferred Securities (the "PREFERRED SECURITIES")
representing preferred undivided beneficial interests in the assets of the
Issuer and having the terms set forth in the Declaration; and

     WHEREAS, as incentive for the Holders to purchase Preferred Securities, the
Guarantor desires to irrevocably and unconditionally agree, to the extent set
forth herein, to pay to the Holders the Guarantee Payments (as defined herein)
and to make certain other payments on the terms and conditions set forth herein;

     NOW, THEREFORE, in consideration of the purchase by the initial purchasers
thereof of Preferred Securities, which purchase the Guarantor hereby agrees
shall benefit the Guarantor, the Guarantor executes and delivers this Guarantee
Agreement for the benefit of the Holders from time to time.

                                    ARTICLE 1
                                   DEFINITIONS

     SECTION 1.01. DEFINITIONS.

      (a)  Capitalized terms used in this Guarantee Agreement but not defined in
the preamble or recitals above have the respective meanings assigned to them in
this Section 1.01.

      (b)  A term defined anywhere in this Guarantee Agreement has the same
meaning throughout.



      (c)  All references to "the Guarantee Agreement" or "this Guarantee
Agreement" are to this Guarantee Agreement as modified, supplemented or amended
from time to time.

      (d)  All references in this Guarantee Agreement to Articles and Sections
are to Articles and Sections of this Guarantee Agreement unless otherwise
specified.

      (e)  A term defined in the Trust Indenture Act has the same meaning when
used in this Guarantee Agreement unless otherwise defined in this Guarantee
Agreement or unless the context otherwise requires.

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

     "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 purposes of this definition, "control"
of a Person shall mean 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" shall have meanings correlative to the foregoing.

     "BUSINESS DAY" has the meaning set forth in the Indenture.

     "COMMISSION" means the Securities and Exchange Commission.

     "COMMON SECURITIES" means the securities representing common undivided
beneficial interests in the assets of the Issuer and having the terms set forth
in Article 7 of the Declaration.

     "DECLARATION" has the meaning set forth in the recitals above.

     "DISTRIBUTIONS" means the periodic distributions and other payments payable
to Holders in accordance with the terms of the Preferred Securities set forth in
Article 7 of to the Declaration.

     "DOLLAR" has the meaning set forth in the Indenture.

     "EVENT OF DEFAULT" means a default by the Guarantor on any of its payment
or other obligations under this Guarantee Agreement; PROVIDED, HOWEVER, that,
except with respect to a default in payment of any Guarantee Payment, any such
default shall constitute an Event of Default only if the Guarantor shall have
received notice of such default and shall not have cured such default within 90
days after receipt of such notice.

                                        2


     "EXTENSION PERIOD" has the meaning set forth in Section 2.8 of the
Supplemental Indenture.

     "GUARANTEE PAYMENTS" means the following payments or distributions, without
duplication, with respect to the Preferred Securities, to the extent not paid or
made by or on behalf of the Issuer: (i) any accumulated and unpaid Distributions
and the Redemption Price, including all accumulated and unpaid Distributions to
the date of redemption, with respect to the Preferred Securities called for
redemption by the Issuer but only if and to the extent that in each case the
Guarantor has made a payment to the Property Trustee of principal of or any
premium or interest on the Notes and (ii) upon a voluntary or involuntary
dissolution, winding-up or termination of the Issuer (other than in connection
with the distribution of Notes to Holders in exchange for Preferred Securities
or the redemption of the Preferred Securities in full upon the maturity or
redemption of the Notes as provided in the Declaration), the lesser of (a) the
aggregate of the liquidation amount and all accumulated and unpaid Distributions
on the Preferred Securities to the date of payment, to the extent the Issuer has
funds on hand legally available therefor, and (b) the amount of assets of the
Issuer remaining available for distribution to Holders in liquidation of the
Issuer as required by applicable law.

     "GUARANTEE TRUSTEE" means The Bank of New York, a New York banking
corporation, until a Successor Guarantee Trustee has been appointed and has
accepted such appointment pursuant to the terms of this Guarantee Agreement, and
thereafter means each such Successor Guarantee Trustee.

     "HOLDER" means any holder, as registered on the books and records of the
Issuer, of any Preferred Securities; PROVIDED, HOWEVER, that in determining
whether the holders of the requisite percentage of Preferred Securities have
given any request, notice, consent or waiver hereunder, "Holder" shall not
include the Guarantor or any Affiliate of the Guarantor.

     "INDEMNIFIED PERSON" means the Guarantee Trustee, any Affiliate of the
Guarantee Trustee, and any officers, directors, shareholders, members, partners,
employees, representatives or agents of the Guarantee Trustee.

     "INDENTURE" means the Indenture dated as of September 12, 2001 between the
Guarantor and Fifth Third Bank, as trustee, as supplemented or amended from time
to time, pursuant to which the Notes are to be issued to the Property Trustee.

     "MAJORITY OF OUTSTANDING PREFERRED SECURITIES" means Holder(s) of
outstanding Preferred Securities, voting together as a single class, who are the
record owners of Preferred Securities representing more than 50% of the
outstanding Preferred Securities.

                                        3


     "NOTES" means the series of unsecured subordinated notes issued to the
Property Trustee by the Guarantor under the Indenture and entitled the "[ ]%
[Subordinated] Notes due [     ]."

     "OFFICERS' CERTIFICATE" means, with respect to any Person, a certificate
signed by the Chairman of the Board, the President, any Vice Chairman of the
Board, any Vice President, the Chief Financial Officer, the Treasurer, any
Assistant Treasurer, the Controller, the Secretary or any Assistant Secretary of
such Person, and delivered to the Guarantee Trustee. One of the officers signing
an Officers' Certificate given pursuant to Section 2.04 shall be the principal
executive, financial or accounting officer of the Guarantor. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Guarantee Agreement shall include:

               (i)     a statement that the person making such certificate has
     read such covenant or condition;

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

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

               (iv)    a statement as to whether or not, in the opinion of such
     person, such condition or covenant has been complied with.

     "PERSON" means any individual, corporation, partnership, limited liability
company, joint venture, incorporated or unincorporated association, joint stock
company, trust, unincorporated organization or government or other agency or
political subdivision thereof or other entity of any kind.

     "PREFERRED SECURITIES" has the meaning set forth in the recitals above.

     "PROPERTY TRUSTEE" means the Person acting as Property Trustee under the
Declaration.

     "REDEMPTION PRICE" means the amount payable on redemption of the Preferred
Securities in accordance with the terms of the Preferred Securities.

     "RESPONSIBLE OFFICER" means, when used with respect to the Guarantee
Trustee, any officer within the corporate trust department of the Guarantee
Trustee, including any vice president, assistant vice president, assistant
secretary,

                                        4


assistant treasurer, trust officer or any other officer of the Guarantee Trustee
who customarily performs functions similar to those performed by the Persons who
at the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of such Person's knowledge of and familiarity with
the particular subject and, in either case, who shall have direct responsibility
for the administration of this Guarantee Agreement.

     "SUCCESSOR GUARANTEE TRUSTEE" means a successor Guarantee Trustee
possessing the qualifications to act as a Guarantee Trustee under Section 4.01.

     "SUPPLEMENTAL INDENTURE" means the [     ] Supplemental Indenture dated as
of _____________, 2003 between the Guarantor and Fifth Third Bank, as trustee,
relating to the issuance of the Notes.

     "TRUST ENFORCEMENT EVENT" has the meaning specified in the Declaration.

     "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as amended.

     ["UNDERWRITING AGREEMENT" has the meaning set forth in the Declaration.]

                                    ARTICLE 2
                               TRUST INDENTURE ACT

     SECTION 2.01. TRUST INDENTURE ACT; APPLICATION.

      (a)  This Guarantee Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Guarantee Agreement and
shall, to the extent applicable, be governed by such provisions.

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

      (c)  The application of the Trust Indenture Act to this Guarantee
Agreement shall not affect the nature of the Preferred Securities as equity
securities representing preferred undivided beneficial interests in the assets
of the Issuer.

                                        5


     SECTION 2.02. LISTS OF HOLDERS OF PREFERRED SECURITIES.

      (a)  The Guarantor shall provide the Guarantee Trustee (unless the
Guarantee Trustee is the registrar of the Preferred Securities) (i) within 14
days after each record date for payment of Distributions, a list, in such form
as the Guarantee Trustee may reasonably require, of the names and addresses of
the Holders ("LIST OF HOLDERS") as of such date, and (ii) at any other time,
within 30 days of receipt by the Guarantor of a written request for a List of
Holders as of a date no more than 15 days before such List of Holders is given
to the Guarantee Trustee; PROVIDED that in each case the Guarantor shall not be
obligated to provide such List of Holders at any time that the List of Holders
does not differ from the most recent List of Holders given to the Guarantee
Trustee by the Guarantor. The Guarantee Trustee shall preserve, in as current a
form as is reasonably practicable, all information contained in the Lists of
Holders given to it; PROVIDED that the Guarantee Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders.

      (b)  The Guarantee Trustee shall comply with its obligations under
Section 312(b) of the Trust Indenture Act.

     SECTION 2.03. REPORTS BY THE GUARANTEE TRUSTEE.

     Within 60 days after ___________ of each year, commencing ___________,
2003, the Guarantee Trustee shall deliver to the Holders such reports as are
required by Section 313 of the Trust Indenture Act, if any, in the form, in the
manner and at the times provided by Section 313 of the Trust Indenture Act. The
Guarantee Trustee shall also comply with the other requirements of Section 313
of the Trust Indenture Act. A copy of each such report shall, at the time of
such transmission to the Holders, be filed by the Guarantee Trustee with the
Guarantor, with each stock exchange or quotation system upon which any Preferred
Securities are listed or traded (if so listed or traded) and also with the
Commission. The Guarantor agrees to promptly notify the Guarantee Trustee when
any Preferred Securities become listed on any stock exchange or quotation system
and of any delisting thereof.

     SECTION 2.04. PERIODIC REPORTS TO THE GUARANTEE TRUSTEE.

     The Guarantor shall provide to the Guarantee Trustee, the Commission and
the Holders, as applicable, such documents, reports and information (if any) as
required by Section 314(a)(1)-(3) of the Trust Indenture Act and the compliance
certificates required by Section 314(a)(4) and (c) of the Trust Indenture Act,
any such certificates to be provided in the form, in the manner and at the times
required by Section 314(a)(4) and (c) of the Trust Indenture Act (PROVIDED that
any certificate to be provided pursuant to Section 314(a)(4) of the Trust
Indenture Act shall be provided within 120 days of the end of each fiscal

                                        6


year of the Issuer). Delivery of such reports, information and documents to the
Guarantee Trustee is for informational purposes only and the Guarantee Trustee's
receipt of such shall not constitute constructive notice of any information
contained therein, including the Guarantor's compliance with any of its
covenants hereunder (as to which the Guarantee Trustee is entitled to rely
exclusively on Officers' Certificates or on certificates provided pursuant to
this Section 2.04).

     SECTION 2.05. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.

     The Guarantor shall provide to the Guarantee Trustee such evidence of
compliance with any conditions precedent, if any, provided for in this Guarantee
Agreement which relate to any of the matters set forth in Section 314(c) of the
Trust Indenture Act. Any certificate or opinion required to be given by an
officer pursuant to Section 314(c) may be given in the form of an Officers'
Certificate.

     SECTION 2.06. EVENTS OF DEFAULT; WAIVER.

      (a)  The Holders of a Majority of Outstanding Preferred Securities may, by
vote, on behalf of the Holders, waive any past Event of Default and its
consequences. Upon such waiver, any such Event of Default shall cease to exist,
and any Event of Default arising therefrom shall be deemed to have been cured,
for every purpose of this Guarantee Agreement, but no such waiver shall extend
to any subsequent or other default or Event of Default, or impair any right
consequent thereon.

      (b)  The right of any Holder to receive payment of the Guarantee Payments
in accordance with this Guarantee Agreement, or to institute suit for the
enforcement of any such payment, shall not be impaired without the consent of
each such Holder.

     SECTION 2.07. DISCLOSURE OF INFORMATION.

     The disclosure of information as to the names and addresses of the Holders
in accordance with Section 312 of the Trust Indenture Act, regardless of the
source from which such information was derived, shall not be deemed to be a
violation of any existing law, or any law hereafter enacted which does not
specifically refer to Section 312 of the Trust Indenture Act, nor shall the
Guarantee Trustee be held accountable by reason of mailing any material pursuant
to a request made under Section 312(b) of the Trust Indenture Act.

     SECTION 2.08. CONFLICTING INTEREST.

      (a)  The Declaration shall be deemed to be specifically described in this
Guarantee Agreement for the purposes of clause (i) of the first proviso
contained in Section 310(b) of the Trust Indenture Act.

                                        7


      (b)  The Guarantee Trustee shall comply with its obligations under
Sections 310(b) and 311 of the Trust Indenture Act.

                                    ARTICLE 3
               POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE

     SECTION 3.01. POWERS AND DUTIES OF THE GUARANTEE TRUSTEE.

      (a)  This Guarantee Agreement shall be held by the Guarantee Trustee in
trust for the benefit of the Holders. The Guarantee Trustee shall not transfer
its right, title and interest in this Guarantee Agreement to any Person except a
Successor Guarantee Trustee on acceptance by such Successor Guarantee Trustee of
its appointment to act as Guarantee Trustee or to a Holder exercising his or her
rights pursuant to Section 5.04(iv). The right, title and interest of the
Guarantee Trustee to this Guarantee Agreement shall vest automatically in each
Person who may hereafter be appointed as Guarantee Trustee in accordance with
Article 4. Such vesting and cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered.

      (b)  If an Event of Default has occurred and is continuing, the Guarantee
Trustee shall enforce this Guarantee Agreement for the benefit of the Holders.

      (c)  This Guarantee Agreement and all moneys received by the Guarantee
Trustee in respect of the Guarantee Payments will not be subject to any right,
charge, security interest, lien or claim of any kind in favor of, or for the
benefit of, the Guarantee Trustee or its agents or their creditors.

      (d)  The Guarantee Trustee shall, within 90 days after the occurrence of
an Event of Default actually known to a Responsible Officer of the Guarantee
Trustee, transmit by mail, first class postage prepaid, to the Holders, as their
names and addresses appear upon the List of Holders, notice of all such Events
of Default, unless such defaults shall have been cured before the giving of such
notice; PROVIDED that the Guarantee Trustee shall be protected in withholding
such notice if and so long as the board of directors, the executive committee or
a trust committee of directors and/or Responsible Officers of the Guarantee
Trustee in good faith determines that the withholding of such notice is in the
interests of the Holders. The Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default except any Event of Default as to which the
Guarantee Trustee shall have received written notice or a Responsible Officer
charged with the administration of this Guarantee Agreement shall have obtained
written notice of such Event of Default.

                                        8


      (e)  The Guarantee Trustee shall continue to serve as a trustee until a
Successor Guarantee Trustee has been appointed and accepted that appointment in
accordance with Article 4.

     SECTION 3.02. CERTAIN RIGHTS AND DUTIES OF THE GUARANTEE TRUSTEE.

      (a)  The Guarantee Trustee, before the occurrence of an Event of Default
and after the curing or waiving of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Guarantee Agreement, and no implied covenants shall be read into this
Guarantee Agreement against the Guarantee Trustee. In case an Event of Default
has occurred (that has not been cured or waived pursuant to Section 2.06), the
Guarantee Trustee shall exercise such of the rights and powers vested in it by
this Guarantee Agreement, and use the same degree of care and skill in its
exercise thereof, as a prudent person would exercise or use under the
circumstances in the conduct of his own affairs.

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

               (i)     prior to the occurrence of an Event of Default and after
     the curing or waiving of all such Events of Default that may have occurred:

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

                         (B) in the absence of willful misconduct on the part of
               the Guarantee Trustee, the Guarantee Trustee may conclusively
               rely, as to the truth of the statements and the correctness of
               the opinions expressed therein, upon any certificates or opinions
               furnished to the Guarantee Trustee and conforming to the
               requirements of this Guarantee Agreement; PROVIDED, HOWEVER, that
               in the case of any such certificates or opinions that by any
               provision hereof or the Trust Indenture Act are specifically
               required to be furnished to the Guarantee Trustee, the Guarantee
               Trustee shall be under a duty to examine the same to determine
               whether or not they conform to the requirements of this Guarantee
               Agreement or the Trust Indenture

                                        9


               Act, as the case may be (but need not confirm or investigate the
               accuracy of mathematical calculations or other facts stated
               therein);

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

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

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

      (c)  Subject to the provisions of Section 3.02(a) and 3.02(b):

               (i)     whenever in the administration of this Guarantee
     Agreement, the Guarantee Trustee shall deem it desirable that a matter be
     proved or established prior to taking, suffering or omitting any action
     hereunder, the Guarantee Trustee (unless other evidence is herein
     specifically prescribed) may, in the absence of willful misconduct on its
     part, request and rely upon an Officers' Certificate, which, upon receipt
     of such request, shall be promptly delivered by the Guarantor;

               (ii)    the Guarantee Trustee (A) may consult with counsel of its
     selection (which may be counsel to the Guarantor or any of its Affiliates
     and may include any of its employees) selected by it in good faith and with
     due care and the advice or opinion of such counsel with respect to legal
     matters 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 and in accordance with such advice and opinion and (B)
     shall have the right at any time to seek, at the expense of the

                                       10


     Guarantor, instructions concerning the administration of this Guarantee
     Agreement from any court of competent jurisdiction;

               (iii)   the Guarantee 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 Guarantee Trustee shall not be
     responsible for any willful misconduct or negligence on the part of any
     agent or attorney appointed by it in good faith and with due care;

               (iv)    the Guarantee Trustee shall be under no obligation to
     exercise any of the rights or powers vested in it by this Guarantee
     Agreement at the request or direction of any Holder, unless such Holder
     shall have offered to the Guarantee Trustee security and indemnity
     satisfactory to the Guarantee Trustee against the costs, expenses
     (including attorneys' fees and expenses) and liabilities that might be
     incurred by it in complying with such request or direction; PROVIDED that
     nothing contained in this clause (iv) shall relieve the Guarantee Trustee
     of the obligation, upon the occurrence of an Event of Default (which has
     not been cured or waived) to exercise such of the rights and powers vested
     in it by this Guarantee Agreement, and to use the same degree of care and
     skill in this exercise as a prudent person would exercise or use under the
     circumstances in the conduct of his own affairs; and

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

     SECTION 3.03. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF GUARANTEE.

     The recitals contained in this Guarantee Agreement shall be taken as the
statements of the Guarantor, and the Guarantee Trustee does not assume any
responsibility for their correctness. The Guarantee Trustee makes no
representations as to the validity or sufficiency of this Guarantee Agreement.

     SECTION 3.04. THE GUARANTEE TRUSTEE MAY OWN PREFERRED SECURITIES.

     The Guarantee Trustee, in its individual or any other capacity, may become
the owner or pledgee of Preferred Securities and may otherwise deal with the
Guarantor with the same rights it would have if it were not the Guarantee
Trustee.

                                       11


     SECTION 3.05. MONEYS RECEIVED BY THE GUARANTEE TRUSTEE TO BE HELD IN TRUST
WITHOUT INTEREST.

     All moneys received by the Guarantee Trustee in respect of Guarantee
Payments shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received, but need not be segregated from other
funds except to the extent required by law. The Guarantee Trustee shall be under
no liability for interest on any moneys received by it hereunder except such as
it may agree in writing to pay thereon.

     SECTION 3.06. COMPENSATION AND EXPENSES OF GUARANTEE TRUSTEE.

     The Guarantor covenants and agrees to pay to the Guarantee Trustee from
time to time, and the Guarantee Trustee shall be entitled to, such compensation
as the Guarantor and the Guarantee Trustee shall from time to time agree in
writing (which shall not be limited by any provision of law in regard to the
compensation of a Guarantee Trustee of an express trust) for all services
rendered by it in the exercise and performance of any of the powers and duties
hereunder of the Guarantee Trustee, and the Guarantor will pay or reimburse the
Guarantee Trustee upon its request for all reasonable expenses, disbursements
and advances incurred or made by the Guarantee Trustee in accordance with any of
the provisions of this Guarantee Agreement (including the reasonable
compensation and the reasonable expenses and disbursements of its counsel and of
all persons not regularly in its employ) except any such expense, disbursement
or advance as may arise from its negligence or willful misconduct. The Guarantor
also covenants to indemnify each of the Guarantee Trustee or any predecessor
Guarantee Trustee and their officers, agents, directors and employees for, and
to hold them harmless against, any and all loss, liability, damage, claim or
expense including taxes (other than taxes based upon, measured by or determined
by the income, profit, franchise or doing business of the Guarantee Trustee)
incurred without negligence or willful misconduct on the part of the Guarantee
Trustee and arising out of or in connection with the acceptance or
administration of this trust, including the reasonable costs and expenses of
defending itself against any claim (whether asserted by the Guarantor, any
Holder or any other Person) of liability in the premises. The provisions of this
Section 3.06 shall survive the termination of this Guarantee Agreement and
resignation or removal of the Guarantee Trustee.

                                    ARTICLE 4
                                GUARANTEE TRUSTEE

     SECTION 4.01. QUALIFICATIONS.

     There shall at all times be a Guarantee Trustee that shall:

                                       12


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

               (ii)    be a national banking association or corporation
     organized and doing business under the laws of the United States of America
     or any State or Territory thereof or of the District of Columbia, or a
     corporation or Person permitted by the Commission to act as an
     institutional trustee under the Trust Indenture Act, authorized under such
     laws to exercise corporate trust powers, having a combined capital and
     surplus of at least $50,000,000, and subject to supervision or examination
     by Federal, State, Territorial or District of Columbia authority. If such
     corporation publishes reports of condition at least annually, pursuant to
     law or to the requirements of the supervising or examining authority
     referred to above, then for the purposes of this clause (ii), 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 Guarantee Trustee shall cease to satisfy the
requirements of clauses (i) and (ii) above, the Guarantee Trustee shall
immediately resign in the manner and with the effect set out in Section 4.02. If
the Guarantee Trustee has or shall acquire any "conflicting interest" within the
meaning of Section 310(b) of the Trust Indenture Act, the Guarantee Trustee and
the Guarantor shall in all respects comply with the provisions of Section 310(b)
of the Trust Indenture Act.

     SECTION 4.02. APPOINTMENT, REMOVAL AND RESIGNATION OF THE GUARANTEE
TRUSTEE.

      (a)  Subject to Section 4.02(b), the Guarantee Trustee may be appointed or
removed without cause at any time by the Guarantor.

      (b)  The Guarantee Trustee shall not be removed in accordance with
Section 4.02(a) until a Successor Guarantee Trustee possessing the
qualifications to act as Guarantee Trustee under Section 4.01 has been appointed
and has accepted such appointment by written instrument executed by such
Successor Guarantee Trustee and delivered to the Guarantor and the Guarantee
Trustee being removed.

      (c)  The Guarantee Trustee appointed to office shall hold office until its
successor shall have been appointed or until its removal or resignation.

      (d)  The Guarantee Trustee may resign from office (without need for prior
or subsequent accounting) by an instrument (a "RESIGNATION REQUEST") in writing
signed by the Guarantee Trustee and delivered to the Guarantor, which
resignation shall take effect upon such delivery or upon such later date as is
specified therein; PROVIDED, HOWEVER, that no such resignation of the Guarantee

                                       13


Trustee shall be effective until a Successor Guarantee Trustee possessing the
qualifications to act as Guarantee Trustee under Section 4.01 has been appointed
and has accepted such appointment by instrument executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.

      (e)  If no Successor Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.02 within 60 days after
delivery to the Guarantor of a Resignation Request or receipt of a notice of
removal by the Guarantee Trustee, the Guarantee Trustee resigning or to be
removed may, at the expense of the Guarantor, petition any court of competent
jurisdiction for appointment of a Successor Guarantee Trustee. Such court may
thereupon after such notice, if any, as it may deem proper, appoint a Successor
Guarantee Trustee.

                                    ARTICLE 5
                                    GUARANTEE

     SECTION 5.01. GUARANTEE.

     The Guarantor irrevocably and unconditionally agrees to pay in full to the
Holders the Guarantee Payments (without duplication of amounts theretofore paid
by the Issuer), as and when due, regardless of any defense, right of set-off or
counterclaim which the Issuer may have or assert. The Guarantor's obligation to
make a Guarantee Payment may be satisfied by direct payment of the required
amounts by the Guarantor to the Holders or to the Guarantee Trustee for
remittance to the Holders or by causing the Issuer to pay such amounts to the
Holders.

     SECTION 5.02. WAIVER OF NOTICE.

     The Guarantor hereby waives notice of acceptance of this Guarantee
Agreement and of any liability to which it applies or may apply, presentment,
demand for payment, any right to require a proceeding first against the Issuer
or any other Person before proceeding against the Guarantor, protest, notice of
nonpayment, notice of dishonor, notice of redemption and all other notices and
demands. Notwithstanding anything to the contrary herein, the Guarantor retains
all of its rights under the Indenture to extend the interest payment period on
the Notes and the Guarantor shall not be obligated hereunder to make any
Guarantee Payment during any Extension Period with respect to the Distributions
on the Preferred Securities.

                                       14


     SECTION 5.03. OBLIGATIONS NOT AFFECTED.

     The obligations, covenants, agreements and duties of the Guarantor under
this Guarantee Agreement shall in no way be affected or impaired by reason of
the happening from time to time of any of the following:

      (a)  the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be performed
or observed by the Issuer;

      (b)  the extension of time for the payment by the Issuer of all or any
portion of the Distributions (other than an extension of time for payment of
Distributions that result from any Extension Period), Redemption Price,
Liquidation Distribution (as defined in the Declaration) or any other sums
payable under the terms of the Preferred Securities or the extension of time for
the performance of any other obligation under, arising out of, or in connection
with, the Preferred Securities (other than an extension of time for payment of
Distributions that result from any Extension Period);

      (c)  any failure, omission, delay or lack of diligence on the part of the
Guarantee Trustee or the Holders to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Guarantee Trustee or the Holders
pursuant to the terms hereof or of the Preferred Securities, respectively, or
any action on the part of the Issuer granting indulgence or extension of any
kind;

      (d)  the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Issuer or any of the assets of the
Issuer;

      (e)  any invalidity of, or defect or deficiency in, the Preferred
Securities;

      (f)  the settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or

      (g)  any other circumstance whatsoever that might otherwise constitute a
legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.03 that the obligations of the Guarantor with respect to the
Guarantee Payments shall be absolute and unconditional under any and all
circumstances.

     There shall be no obligation of the Guarantee Trustee or the Holders to
give notice to, or obtain consent of, the Guarantor with respect to the
happening of any of the foregoing.

                                       15


     SECTION 5.04. ENFORCEMENT OF GUARANTEE.

     The Guarantor and the Guarantee Trustee expressly acknowledge and agree
that (i) this Guarantee Agreement will be deposited with the Guarantee Trustee
to be held for the benefit of the Holders; (ii) the Guarantee Trustee has the
right to enforce this Guarantee Agreement on behalf of the Holders; (iii)
Holders representing not less than a Majority of Outstanding Preferred
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Guarantee Trustee in respect of this
Guarantee Agreement or exercising any trust or other power conferred upon the
Guarantee Trustee under this Guarantee Agreement; and (iv) if the Guarantee
Trustee fails to enforce this Guarantee Agreement as provided in clauses (ii)
and (iii) above, any Holder may institute a legal proceeding directly against
the Guarantor to enforce its rights under this Guarantee Agreement, without
first instituting a legal proceeding against the Issuer, the Guarantee Trustee
or any other Person. Notwithstanding the foregoing, if the Guarantor has failed
to make a Guarantee Payment, a Holder may directly institute a proceeding
against the Guarantor for enforcement of this Guarantee Agreement for such
payment without first instituting a legal proceeding against the Issuer, the
Guarantee Trustee or any other Person.

     SECTION 5.05. GUARANTEE OF PAYMENT.

     This Guarantee Agreement creates a guarantee of payment and not merely of
collection. This Guarantee Agreement will not be discharged except by payment of
the Guarantee Payments in full (without duplication of amounts theretofore paid
by the Issuer) or upon the distribution of the Notes to the Holders as provided
in the Declaration.

     SECTION 5.06. SUBROGATION.

     The Guarantor shall be subrogated to all (if any) rights of the Holders
against the Issuer in respect of any amounts paid to the Holders by the
Guarantor under this Guarantee Agreement; PROVIDED, HOWEVER, that the Guarantor
shall not (except to the extent required by mandatory provisions of law) be
entitled to enforce or exercise any rights which it may acquire by way of
subrogation or any indemnity, reimbursement or other agreement, in all cases as
a result of payment under this Guarantee Agreement, if, at the time of any such
payment, any amounts are due and unpaid under this Guarantee Agreement. If any
amount shall be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders and to pay
over such amount to the Holders or to the Guarantee Trustee for remittance to
the Holders.

                                       16


     SECTION 5.07. INDEPENDENT OBLIGATIONS.

     The Guarantor acknowledges that its obligations hereunder are independent
of the obligations of the Issuer with respect to the Preferred Securities and
that the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Guarantee Agreement
notwithstanding the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 5.03 hereof.

                                    ARTICLE 6
                    LIMITATION OF TRANSACTIONS; SUBORDINATION

     SECTION 6.01. LIMITATION OF TRANSACTIONS.

     So long as any Preferred Securities remain outstanding, if at such time (i)
the Guarantor shall be in default with respect to its Guarantee Payments or
other payment obligations hereunder, (ii) there shall have occurred and be
continuing any event of default under the Declaration or (iii) the Guarantor
shall have given notice of its election of an Extension Period and such period,
or any extension thereof, is continuing, the Guarantor shall not (a) make any
payment of principal, interest or premium, if any, on or repay, repurchase or
redeem any debt securities that rank junior to the Notes in the right of payment
issued by the Guarantor, or (b) make any guarantee payments with respect to any
guarantee by the Guarantor of any securities of any of its subsidiaries if such
guarantee ranks junior to the Notes in the right of payment, (c) declare or pay
any dividends or distributions on any of the Guarantor's capital stock or (d)
redeem, purchase, acquire or make a liquidation payment with respect to, any of
the Guarantor's capital stock. Notwithstanding the foregoing, the Guarantor may
(1) purchase or acquire its capital stock in connection with the satisfaction by
it of its obligations under any employee benefit plans or pursuant to any
contract or security outstanding on the first day of any such event requiring it
to purchase its capital stock; (2) reclassify its capital stock or exchange or
convert one class or series of its capital stock for another class or series of
its capital stock; (3) purchase fractional interests in shares of its capital
stock pursuant to the conversion or exchange provisions of such capital stock or
the security being converted or exchanged; (4) declare dividends or
distributions in its capital stock; (5) redeem or repurchase any rights pursuant
to a rights agreement; and (6) make payments under this Guarantee related to the
Preferred Securities. In addition, so long as any Preferred Securities remain
outstanding, the Guarantor (i) will remain the sole direct or indirect owner of
all of the outstanding Common Securities and shall not cause or permit the

                                       17


Common Securities to be transferred except to the extent such transfer is
permitted under the Declaration; PROVIDED that any permitted successor of the
Guarantor under the Indenture may succeed to the Guarantor's direct or indirect
ownership of the Common Securities, (ii) will cause the holder of the Common
Securities to satisfy the requirements of Section 5.03 of the Declaration and
(iii) will use reasonable efforts to cause the Issuer to continue to be treated
as a grantor trust for United States federal income tax purposes, except in
connection with a distribution of Notes as provided in the Declaration.

     SECTION 6.02. SUBORDINATION.

     If a Trust Enforcement Event has occurred and is continuing under the
Declaration the rights of the holders of the Common Securities to receive any
payments will be subordinated to the rights of the Holders of the Preferred
Securities to receive Guarantee Payments.

                                    ARTICLE 7
                                   TERMINATION

     SECTION 7.01. TERMINATION.

     This Guarantee Agreement shall terminate and be of no further force and
effect (i) upon full payment of the Redemption Price of, plus all accumulated
and unpaid Distributions on, all Preferred Securities, (ii) upon the
distribution of Notes to Holders and holders of Common Securities in exchange
for all of the Preferred Securities and Common Securities or (iii) upon full
payment of the amounts payable in accordance with the Declaration upon
liquidation of the Issuer. Notwithstanding the foregoing, this Guarantee
Agreement will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder must restore payment of any sums paid with respect
to the Preferred Securities or under this Guarantee Agreement.

                                    ARTICLE 8
                    LIMITATION OF LIABILITY; INDEMNIFICATION

     SECTION 8.01. EXCULPATION.

      (a)  No Indemnified Person shall be liable, responsible or accountable in
damages or otherwise to the Guarantor or any Holder for any loss, damage or
claim incurred by reason of any act or omission performed or omitted by such

                                       18


Indemnified Person in good faith in accordance with this Guarantee Agreement and
in a manner such Indemnified Person reasonably believed to be within the scope
of the authority conferred on such Indemnified Person by this Guarantee
Agreement or by law, except that an Indemnified Person shall be liable for any
such loss, damage or claim incurred by reason of such Indemnified Person's
negligence or willful misconduct with respect to such acts or omissions.

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

     SECTION 8.02. INDEMNIFICATION.

     To the fullest extent permitted by applicable law, the Guarantor shall
indemnify and hold harmless each Indemnified Person from and against any loss,
damage or claim incurred by such Indemnified Person by reason of any act or
omission performed or omitted by such Indemnified Person in good faith in
accordance with this Guarantee Agreement and in a manner such Indemnified Person
reasonably believed to be within the scope of authority conferred on such
Indemnified Person by this Guarantee Agreement, except that no Indemnified
Person shall be entitled to be indemnified in respect of any loss, damage or
claim incurred by such Indemnified Person by reason of negligence or willful
misconduct with respect to such acts or omissions.

     SECTION 8.03. SURVIVE TERMINATION.

     The provisions of Sections 8.01 and 8.02 shall survive the termination of
this Guarantee Agreement or the resignation or removal of the Guarantee Trustee.

                                    ARTICLE 9
                                  MISCELLANEOUS

     SECTION 9.01. SUCCESSORS AND ASSIGNS.

     All guarantees and agreements contained in this Guarantee Agreement shall
bind the successors, assignees, receivers, trustees and representatives of the
Guarantor and shall inure to the benefit of the Guarantee Trustee and the
Holders

                                       19


then outstanding. Except in connection with a consolidation, merger or sale
involving the Guarantor that is permitted under Article 8 of the Indenture, the
Guarantor shall not assign its obligations hereunder.

     SECTION 9.02. AMENDMENTS.

     Except with respect to any changes which do not adversely affect the rights
of Holders in any material respect (in which case no consent of Holders will be
required), this Guarantee Agreement may only be amended with the prior approval
of the Guarantor, the Guarantee Trustee and the Holders of not less than a
Majority of Outstanding Preferred Securities. The provisions of Section 11.02 of
the Declaration concerning meetings of Holders shall apply to the giving of such
approval.

     SECTION 9.03. NOTICES.

     Any notice, request or other communication required or permitted to be
given hereunder shall be in writing, in English, duly signed by the party giving
such notice, and delivered, telecopied or mailed by first class mail as follows:

      (a)  if given to the Guarantor, to the address set forth below or such
other address as the Guarantor may give notice of to the Holders:

Cinergy Corp.
139 East Fourth Street
Cincinnati, OH 45202
Attention:
Facsimile:

with a copy to:

[               ]
[               ]
[               ]

      (b)  if given to the Guarantee Trustee, to the address set forth below or
such other address as the Guarantee Trustee may give notice of to the Holders:

[               ]
[    Address    ]
Attention:
Facsimile:

      (c)  if given to any Holder, at the address set forth on the books and
records of the Issuer.

                                       20


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

     SECTION 9.04. GENDERS.

     The masculine, feminine and neuter genders used herein shall include the
masculine, feminine and neuter genders.

     SECTION 9.05. BENEFIT.

     This Guarantee Agreement is solely for the benefit of the Guarantee Trustee
and the Holders and, subject to Section 3.01(a), is not separately transferable
from the Preferred Securities.

     SECTION 9.06. GOVERNING LAW.

     THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS).

     SECTION 9.07. COUNTERPARTS.

     This Guarantee Agreement may be executed in counterparts, each of which
shall be an original; but such counterparts shall together constitute one and
the same instrument.

     SECTION 9.08. INTENTIONALLY OMITTED.

     SECTION 9.09. LIMITED LIABILITY.

     Neither the Guarantee Trustee nor the Holders, in their capacities as such,
shall be personally liable for any liabilities or obligations of the Guarantor
arising out of this Guarantee Agreement. The parties further hereby agree that
the Holders, in their capacities as such, shall be entitled to the same
limitation of personal liability extended to the stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.

                                       21


     THIS GUARANTEE AGREEMENT is executed as of the day and year first above
written.

                                                CINERGY CORP.

                                                By:
                                                    ----------------------------
                                                    Name:
                                                    Title:


                                                THE BANK OF NEW YORK,
                                                   as Guarantee Trustee


                                                By:
                                                    ----------------------------
                                                    Name:
                                                    Title:

                                       22

EX-4.9

                                                                     EXHIBIT 4.9


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


                                  CINERGY CORP.


                                       and


                                [               ],

                           as Purchase Contract Agent


                           PURCHASE CONTRACT AGREEMENT


                          Dated as of ___________, 2003


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



                                                                                           
                                             ARTICLE 1
                     DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATIONS

SECTION 1.01.  Definitions.....................................................................1
SECTION 1.02.  Compliance certificates and opinions...........................................11
SECTION 1.03.  FORM OF DOCUMENTS DELIVERED TO PURCHASE CONTRACT AGENT.........................12
SECTION 1.04.  ACTS OF HOLDERS; RECORD DATES..................................................12
SECTION 1.05.  Notices........................................................................14
SECTION 1.06.  NOTICE TO HOLDERS; WAIVER......................................................15
SECTION 1.07.  EFFECT OF HEADINGS AND TABLE OF CONTENTS.......................................16
SECTION 1.08.  SUCCESSORS AND ASSIGNS.........................................................16
SECTION 1.09.  Separability Clause............................................................16
SECTION 1.10.  BENEFITS OF AGREEMENT..........................................................16
SECTION 1.11.  Governing Law..................................................................16
SECTION 1.12.  Legal Holidays.................................................................16
SECTION 1.13.  Counterparts...................................................................17
SECTION 1.14.  INSPECTION OF AGREEMENT........................................................17
SECTION 1.15.  APPOINTMENT OF FINANCIAL INSTITUTION AS AGENT FOR THE COMPANY..................17

                                             ARTICLE 2
                                         CERTIFICATE FORMS

SECTION 2.01.  FORMS OF CERTIFICATES GENERALLY................................................17
SECTION 2.02.  FORM OF PURCHASE CONTRACT AGENT'S CERTIFICATE OF AUTHENTICATION................18

                                             ARTICLE 3
                                          THE SECURITIES

SECTION 3.01.  AMOUNT; FORM AND DENOMINATIONS.................................................19
SECTION 3.02.  RIGHTS AND OBLIGATIONS EVIDENCED BY THE CERTIFICATES...........................19
SECTION 3.03.  EXECUTION, AUTHENTICATION, DELIVERY AND DATING.................................20
SECTION 3.04.  TEMPORARY CERTIFICATES.........................................................20
SECTION 3.05.  REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE............................21
SECTION 3.06.  BOOK-ENTRY INTERESTS...........................................................23
SECTION 3.07.  Notices to Holders.............................................................23
SECTION 3.08.  APPOINTMENT OF SUCCESSOR DEPOSITARY............................................23
SECTION 3.09.  DEFINITIVE CERTIFICATES........................................................24
SECTION 3.10.  MUTILATED, DESTROYED, LOST AND STOLEN CERTIFICATES.............................24
SECTION 3.11.  PERSONS DEEMED OWNERS..........................................................25
SECTION 3.12.  Cancellation...................................................................26



                                        i


                                                                                           
SECTION 3.13.  CREATION OF TREASURY STOCK PURCHASE UNITS BY SUBSTITUTION OF TREASURY
                SECURITIES....................................................................26
SECTION 3.14.  REESTABLISHMENT OF STOCK PURCHASE UNITS........................................28
SECTION 3.15.  TRANSFER OF COLLATERAL UPON OCCURRENCE OF TERMINATION EVENT....................29
SECTION 3.16.  NO CONSENT TO ASSUMPTION.......................................................30

                                             ARTICLE 4
        THE PREFERRED SECURITIES, [SUBORDINATED] NOTES AND APPLICABLE OWNERSHIP INTEREST OF
                                      THE TREASURY PORTFOLIO

SECTION 4.01.  INTEREST PAYMENTS; RIGHTS TO INTEREST PAYMENTS PRESERVED.......................31
SECTION 4.02.  Notice and Voting..............................................................32
SECTION 4.03.  DISTRIBUTION OF [SUBORDINATED] NOTES; TAX EVENT REDEMPTION.....................33

                                             ARTICLE 5
                                      THE PURCHASE CONTRACTS

SECTION 5.01.  PURCHASE OF SHARES OF COMMON STOCK.............................................34
SECTION 5.02.  PAYMENT OF PURCHASE PRICE......................................................37
SECTION 5.03.  ISSUANCE OF SHARES OF COMMON STOCK.............................................42
SECTION 5.04.  ADJUSTMENT OF SETTLEMENT RATE..................................................43
SECTION 5.05.  NOTICE OF ADJUSTMENTS AND CERTAIN OTHER EVENTS.................................50
SECTION 5.06.  TERMINATION EVENT; NOTICE......................................................50
SECTION 5.07.  Early Settlement...............................................................51
SECTION 5.08.  INTENTIONALLY OMITTED..........................................................53
SECTION 5.09.  NO FRACTIONAL SHARES...........................................................53
SECTION 5.10.  Charges and Taxes..............................................................53
SECTION 5.11.  PURCHASE CONTRACT PAYMENTS.....................................................54
SECTION 5.12.  DEFERRAL OF PURCHASE CONTRACT PAYMENTS.........................................55

                                             ARTICLE 6
                                             REMEDIES

SECTION 6.01.  UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PURCHASE CONTRACT PAYMENTS AND TO
                PURCHASE SHARES OF COMMON STOCK...............................................56
SECTION 6.02.  RESTORATION OF RIGHTS AND REMEDIES.............................................56
SECTION 6.03.  RIGHTS AND REMEDIES CUMULATIVE.................................................56
SECTION 6.04.  DELAY OR OMISSION NOT WAIVER...................................................57
SECTION 6.05.  UNDERTAKING FOR COSTS..........................................................57
SECTION 6.06.  WAIVER OF STAY OR EXTENSION LAWS...............................................57



                                       ii


                                                                                           
                                             ARTICLE 7
                                    THE PURCHASE CONTRACT AGENT

SECTION 7.01.  CERTAIN DUTIES AND RESPONSIBILITIES............................................58
SECTION 7.02.  Notice of Default..............................................................59
SECTION 7.03.  CERTAIN RIGHTS OF PURCHASE CONTRACT AGENT......................................59
SECTION 7.04.  NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.........................61
SECTION 7.05.  May Hold Securities............................................................61
SECTION 7.06.  MONEY HELD IN CUSTODY..........................................................61
SECTION 7.07.  COMPENSATION AND REIMBURSEMENT.................................................61
SECTION 7.08.  CORPORATE PURCHASE CONTRACT AGENT REQUIRED;   ELIGIBILITY......................62
SECTION 7.09.  RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR..............................62
SECTION 7.10.  ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.........................................64
SECTION 7.11.  MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS....................64
SECTION 7.12.  PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.........................64
SECTION 7.13.  NO OBLIGATIONS OF PURCHASE CONTRACT AGENT......................................65
SECTION 7.14.  Tax Compliance.................................................................65

                                             ARTICLE 8
                                      SUPPLEMENTAL AGREEMENTS

SECTION 8.01.  SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF HOLDERS.............................66
SECTION 8.02.  SUPPLEMENTAL AGREEMENTS WITH CONSENT OF HOLDERS................................66
SECTION 8.03.  EXECUTION OF SUPPLEMENTAL AGREEMENTS...........................................68
SECTION 8.04.  EFFECT OF SUPPLEMENTAL AGREEMENTS..............................................68
SECTION 8.05.  REFERENCE TO SUPPLEMENTAL AGREEMENTS...........................................68

                                             ARTICLE 9
                       CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

SECTION 9.01.  COVENANT NOT TO CONSOLIDATE, MERGE, CONVEY, TRANSFER OR LEASE
                PROPERTY EXCEPT UNDER CERTAIN CONDITIONS......................................68
SECTION 9.02.  RIGHTS AND DUTIES OF SUCCESSOR CORPORATION.....................................69
SECTION 9.03.  OFFICERS' CERTIFICATE AND OPINION OF COUNSEL GIVEN TO PURCHASE
                CONTRACT AGENT................................................................69



                                       iii


                                                                                           
                                            ARTICLE 10
                                             COVENANTS

SECTION 10.01. PERFORMANCE UNDER PURCHASE CONTRACTS...........................................70
SECTION 10.02. MAINTENANCE OF OFFICE OR AGENCY................................................70
SECTION 10.03. COMPANY TO RESERVE COMMON STOCK................................................70
SECTION 10.04. COVENANTS AS TO COMMON STOCK...................................................71
SECTION 10.05. STATEMENTS OF OFFICERS OF THE COMPANY AS TO DEFAULT............................71
SECTION 10.06. ERISA..........................................................................71



                                       iv


     PURCHASE CONTRACT AGREEMENT, dated as of __________, 2003, between CINERGY
CORP., a Delaware corporation (the "COMPANY"), and [          ], an __________
banking corporation, acting as purchase contract agent for the Holders of
Securities (as defined herein) from time to time (the "PURCHASE CONTRACT
AGENT").

                                    RECITALS

     The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the Securities.

     All things necessary to make the Purchase Contracts, when the Certificates
are executed by the Company and authenticated, executed on behalf of the Holders
and delivered by the Purchase Contract Agent, as provided in this Agreement, the
valid obligations of the Company, and to constitute these presents a valid
agreement of the Company, in accordance with its terms, have been done. For and
in consideration of the premises and the purchase of the Securities by the
Holders thereof, it is mutually agreed as follows:

                                    ARTICLE 1

            DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATIONS

     SECTION 1.01. DEFINITIONS.

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

     (a) the terms defined in this Article have the meanings assigned to them in
this Article and include the plural as well as the singular, and nouns and
pronouns of the masculine gender include the feminine and neuter genders;

     (b) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles in
the United States;

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

     (d) the following terms have the meanings given to them in the Declaration:
(i) Applicable Ownership Interest; (ii) Applicable Principal Amount; (iii)
Guarantee; (iv) Primary Treasury Dealer; (v) Pro Rata, (vi) Quotation Agent;
(vii) Redemption Amount; (viii)



Redemption Price; (ix) Remarketing, (x) Reset Rate, (xi) Tax Event Redemption,
(xii) Tax Event Redemption Date; (xiii) Two-Year Benchmark Treasury Rate; and
(xiv) Treasury Portfolio; and

     (e) the following terms have the meanings given to them in this Section
1.01(e):

     "ACT" has the meaning, with respect to any Holder, set forth in Section
1.04.

     "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.

     "AGREEMENT" means this instrument as originally executed or as it may from
time to time be supplemented or amended by one or more agreements supplemental
hereto entered into pursuant to the applicable provisions hereof.

     "APPLICABLE MARKET VALUE" has the meaning set forth in Section 5.01.

     "APPLICANTS" has the meaning set forth in Section 7.12(b).

     "BANKRUPTCY CODE" means title 11 of the United States Code, or any other
law of the United States that from time to time provides a uniform system of
bankruptcy laws.

     "BENEFICIAL OWNER" means, with respect to a Book-Entry Interest, a Person
who is the beneficial owner of such Book-Entry Interest as reflected on the
books of the Depositary or on the books of a Person maintaining an account with
such Depositary (directly as a Depositary Participant or as an indirect
participant, in each case in accordance with the rules of such Depositary).

     "BOARD OF DIRECTORS" means the board of directors of the Company or a duly
authorized committee of that board.

     "BOARD RESOLUTION" means one or more resolutions of the Board of Directors,
a copy of which has been certified by the Secretary or an Assistant Secretary of
the Company, to have been duly adopted by the Board of Directors and to be in
full force and effect on the date of such certification and delivered to the
Purchase Contract Agent.

     "BOOK-ENTRY INTEREST" means a beneficial interest in a Global Certificate,
registered in the name of a Depositary or a nominee thereof, ownership and
transfers of which shall be maintained and made through book entries by such
Depositary as described in Section 3.06.

                                        2


     "BUSINESS DAY" means any day other than a Saturday or Sunday or a day on
which banking institutions in New York City, New York, or Chicago, Illinois are
authorized or required by law or executive order to remain closed or a day on
which the Indenture Trustee or the Property Trustee is closed for business;
provided that for purposes of the second paragraph of Section 1.12 only, the
term "Business Day" shall also be deemed to exclude any day on which trading on
the New York Stock Exchange, Inc. is closed or suspended.

     "CASH SETTLEMENT" has the meaning set forth in Section 5.02(a)(i).

     "CERTIFICATE" means a Stock Purchase Units Certificate or a Treasury Stock
Purchase Units Certificate.

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

     "CLOSING PRICE" has the meaning set forth in Section 5.01.

     "CODE" means the Internal Revenue Code of 1986, as amended.

     "COLLATERAL" has the meaning set forth in Section 1.01(f) of the Pledge
Agreement.

     "COLLATERAL ACCOUNT" has the meaning set forth in Section 1.01(f) of the
Pledge Agreement.

     "COLLATERAL AGENT" means [          ], as Collateral Agent under the Pledge
Agreement until a successor Collateral Agent shall have become such pursuant to
the applicable provisions of the Pledge Agreement, and thereafter "Collateral
Agent" shall mean the Person who is then the Collateral Agent thereunder.

     "COLLATERAL SUBSTITUTION" has the meaning set forth in Section 3.13.

     "COMMON STOCK" means the Cinergy Corp., common stock, par value $0.01.

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

     "CONSTITUENT PERSON" has the meaning set forth in Section 5.04(b).

     "CORPORATE TRUST OFFICE" means the principal corporate trust office of the
Purchase Contract Agent at which, at any particular time, its corporate trust
business shall be administered, which office at the date hereof is located at
[              ],

                                        3


Attention: Corporate Trust Department.

     "COUPON RATE" means the percentage rate per annum at which each
[Subordinated] Note will bear interest initially and, on and after
_______________, the Reset Rate.

     "CURRENT MARKET PRICE" has the meaning set forth in Section 5.04(a)(8).

     "DECLARATION" means the Amended and Restated Declaration of Trust of CC
Funding Trust II, dated as of ___________, 2003, among the Company as sponsor,
the trustees named therein and the holders from time to time of individual
beneficial interests in the assets of the Trust.

     "DEPOSITARY" means a clearing agency registered under the Exchange Act that
is designated to act as Depositary for the Securities as contemplated by
Sections 3.06, 3.07, 3.08 and 3.09.

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

     "DTC" means The Depository Trust Company.

     "EARLY SETTLEMENT" has the meaning set forth in Section 5.07(a).

     "EARLY SETTLEMENT AMOUNT" has the meaning set forth in Section 5.07(a).

     "EARLY SETTLEMENT DATE" has the meaning set forth in Section 5.07(a).

     "EARLY SETTLEMENT RATE" has the meaning set forth in Section 5.07(c).

     "EARLY SETTLEMENT WEEK" has the meaning set forth in Section 5.04(b)(2).

     "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.

     "EXCHANGE ACT" means the Securities Exchange Act of 1934 and any statute
successor thereto, in each case as amended from time to time, and the rules and
regulations promulgated thereunder.

     "EXPIRATION DATE" has the meaning set forth in Section 1.04(e).

     "EXPIRATION TIME" has the meaning set forth in Section 5.04(a)(6).

     "FAILED REMARKETING" has the meaning set forth in Section 5.02(b).

     "GLOBAL CERTIFICATE" means a Certificate that evidences all or part of the
Securities and is

                                        4


registered in the name of a Clearing Agency or a nominee thereof.

     "GUARANTEE means the Guarantee Agreement dated as of ___________, 2003
between the Company, as guarantor, and the Trust.

     "HOLDER" means, with respect to a Security, the Person in whose name the
Security evidenced by a Certificate is registered in the Security Register;
provided, however, that in determining whether the Holders of the requisite
number of Securities have voted on any matter, then for the purpose of such
determination only (and not for any other purpose hereunder), if the Security
remains in the form of one or more Global Certificates and if the Depositary
which is the registered holder of such Global Certificate has sent an omnibus
proxy assigning voting rights to the Depositary Participants to whose accounts
the Securities are credited on the record date, the term "HOLDER" shall mean
such Depositary Participant acting at the direction of the Beneficial Owners.

     "INDENTURE" means the Indenture, dated as of September 12, 2001, between
the Company and the Indenture Trustee (including any provisions of the TIA that
are deemed incorporated therein), pursuant to which the [Subordinated] Notes
will be issued.

     "INDENTURE TRUSTEE" means The Fifth Third Bank, an Ohio banking
corporation, as trustee under the Indenture, or any successor thereto.

     "ISSUER ORDER" or "ISSUER REQUEST" means a written order or request signed
in the name of the Company by its Chairman of the Board, its President or one of
its Vice Presidents, and by its Treasurer, an Assistant Treasurer, its Secretary
or an Assistant Secretary, and delivered to the Purchase Contract Agent.

     "NON-ELECTING SHARE" has the meaning set forth in Section 5.04(b).

     "NYSE" has the meaning set forth in Section 5.01.

     "OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of the
Board, its President or one of its Vice Presidents, and by the Treasurer, an
Assistant Treasurer, the Secretary or an Assistant Secretary of the Company, and
delivered to the Purchase Contract Agent. Any Officers' Certificate delivered
with respect to compliance with a condition or covenant provided for in this
Agreement shall include:

            (i)  a statement that each officer signing the Officers' Certificate
     has read the covenant or condition and the definitions relating thereto;

           (ii)  a brief statement of the nature and scope of the examination or
     investigation undertaken by each officer in rendering the Officers'
     Certificate;

          (iii)  a statement that, in the opinion of each such officer, each
     such officer has

                                        5


     made such examination or investigation as is necessary to enable such
     officer to express an informed opinion as to whether or not such covenant
     or condition has been complied with; and

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

     "OPINION OF COUNSEL" means a written opinion of counsel, who may be counsel
to the Company (and who may be an employee of the Company), and who shall be
reasonably acceptable to the Purchase Contract Agent. An opinion of counsel may
rely on certificates as to matters of fact.

     "OUTSTANDING SECURITIES" means, with respect to any Security and as of the
date of determination, all Securities evidenced by Certificates theretofore
authenticated, executed and delivered under this Agreement, except:

            (i)  If a Termination Event has occurred, (i) Treasury Stock
     Purchase Units and (ii) Stock Purchase Units for which the underlying
     [Subordinated] Notes have been theretofore deposited with the Purchase
     Contract Agent in trust for the Holders of such Stock Purchase Units;

           (ii)  Securities evidenced by Certificates theretofore cancelled by
     the Purchase Contract Agent or delivered to the Purchase Contract Agent for
     cancellation or deemed cancelled pursuant to the provisions of this
     Agreement; and

          (iii)  Securities evidenced by Certificates in exchange for or in lieu
     of which other Certificates have been authenticated, executed on behalf of
     the Holder and delivered pursuant to this Agreement, other than any such
     Certificate in respect of which there shall have been presented to the
     Purchase Contract Agent proof satisfactory to it that such Certificate is
     held by a protected purchaser in whose hands the Securities evidenced by
     such Certificate are valid obligations of the Company;

PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
number of the Securities have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Securities owned by the Company
or any Affiliate of the Company shall be disregarded and deemed not to be
Outstanding Securities, except that, in determining whether the Purchase
Contract Agent shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Securities that a
Responsible Officer of the Purchase Contract Agent actually knows to be so owned
shall be so disregarded. Securities so owned that have been pledged in good
faith may be regarded as Outstanding Securities if the pledgee establishes to
the satisfaction of the Purchase Contract Agent the pledgee's right so to act
with respect to such Securities and that the pledgee is not the Company or any
Affiliate of the Company.

                                        6


     "PAYMENT DATE" means each ____________, ___________, ___________ and
___________, commencing ___________, 2003.

     "PERMITTED INVESTMENTS" has the meaning set forth in Section 1.01(f) of the
Pledge Agreement.

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

     "PLAN" means an employee benefit plan that is subject to ERISA, a plan or
individual retirement account that is subject to Section 4975 of the Code or any
entity whose assets are considered assets of any such plan.

     "PLEDGE" means the pledge under the Pledge Agreement of the Preferred
Securities, the [Subordinated] Notes, the Treasury Securities or the appropriate
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio, in each case constituting a part of the
Securities.

     "PLEDGE AGREEMENT" means the Pledge Agreement, dated as of __________,
2003, among the Company, the Collateral Agent, the Securities Intermediary and
the Purchase Contract Agent, on its own behalf and as attorney-in-fact for the
Holders from time to time of the Securities.

     "PLEDGED [SUBORDINATED] NOTES" has the meaning set forth in Section 1.01(f)
of the Pledge Agreement.

     "PLEDGED PREFERRED SECURITIES" has the meaning set forth in Section 1.01(f)
of the Pledge Agreement.

     "PREDECESSOR CERTIFICATE" means a Predecessor Stock Purchase Units
Certificate or a Predecessor Treasury Stock Purchase Units Certificate.

     "PREDECESSOR STOCK PURCHASE UNITS CERTIFICATE" of any particular Stock
Purchase Units Certificate means every previous Stock Purchase Units Certificate
evidencing all or a portion of the rights and obligations of the Company and the
Holder under the Stock Purchase Units evidenced thereby; and, for the purposes
of this definition, any Stock Purchase Units Certificate authenticated and
delivered under Section 3.10 in exchange for or in lieu of a mutilated,
destroyed, lost or stolen Stock Purchase Units Certificate shall be deemed to
evidence the same rights and obligations of the Company and the Holder as the
mutilated, destroyed, lost or stolen Stock Purchase Units Certificate.

     "PREDECESSOR TREASURY STOCK PURCHASE UNITS CERTIFICATE" of any particular
Treasury

                                        7


Stock Purchase Units Certificate means every previous Treasury Stock Purchase
Units Certificate evidencing all or a portion of the rights and obligations of
the Company and the Holder under the Treasury Stock Purchase Units evidenced
thereby; and, for the purposes of this definition, any Treasury Stock Purchase
Units Certificate authenticated and delivered under Section 3.10 in exchange for
or in lieu of a mutilated, destroyed, lost or stolen Treasury Stock Purchase
Units Certificate shall be deemed to evidence the same rights and obligations of
the Company and the Holder as the mutilated, destroyed, lost or stolen Treasury
Stock Purchase Units Certificate.

     "PREFERRED SECURITIES" means the Preferred Securities of the Trust, each
having a stated liquidation amount of $25, representing preferred undivided
beneficial interests in the assets of the Trust.

     "PROCEEDS" has the meaning set forth in Section 1.01(f) of the Pledge
Agreement.

     "PROPERTY TRUSTEE" means [         ], as initial property trustee under the
Declaration, or any successors thereto that is a financial institution
unaffiliated with the Company.

     "PROSPECTUS" means the prospectus relating to the delivery of shares of
Common Stock in connection with an Early Settlement under Section 5.07 or an
early settlement of Purchase Contracts during the Early Settlement Week under
Section 5.04(b)(2), in the form in which first filed, or transmitted for filing,
with the Commission after the effective date of the Registration Statement
pursuant to Rule 424(b) under the Securities Act, including the documents
incorporated by reference therein as of the date of such Prospectus.

     "PURCHASE CONTRACT" means, with respect to any Security, the contract
forming a part of such Security and obligating the Company to (i) sell, and the
Holder of such Security to purchase, shares of Common Stock and (ii) pay the
Holder thereof Purchase Contract Payments, in each case on the terms and subject
to the conditions set forth in Article Five hereof.

     "PURCHASE CONTRACT AGENT" means the Person named as the "PURCHASE CONTRACT
AGENT" in the first paragraph of this Agreement until a successor Purchase
Contract Agent shall have become such pursuant to the applicable provisions of
this Agreement, and thereafter "PURCHASE CONTRACT AGENT" shall mean such Person.

     "PURCHASE CONTRACT PAYMENTS" means the payments payable by the Company on
the Payment Dates in respect of each Purchase Contract, at a rate per year
of____% of the Stated Amount per Purchase Contract.

     "PURCHASE CONTRACT SETTLEMENT DATE" means _____________.

     "PURCHASE CONTRACT SETTLEMENT FUND" has the meaning set forth in Section
5.03.

     "PURCHASE PRICE" has the meaning set forth in Section 5.01.

                                        8


     "PURCHASED SHARES" has the meaning set forth in Section 5.04(a)(6).

     "RECORD DATE" for any distribution and Purchase Contract Payment payable on
any Payment Date means, as to any Global Certificate, the Business Day next
preceding such Payment Date, and as to any other Certificate, the fifteenth
Business Day prior to such Payment Date.

     "REFERENCE DEALER" means a dealer engaged in trading of convertible
securities.

     "REFERENCE PRICE" has the meaning set forth in Section 5.01.

     "REGISTRATION STATEMENT" means a registration statement under the
Securities Act prepared by the Company covering, inter alia, the delivery by the
Company of the shares of Common Stock in connection with an Early Settlement
under Section 5.07 or an early settlement of Purchase Contracts during the Early
Settlement Week under Section 5.04(b)(2), including all exhibits thereto and the
documents incorporated by reference in the prospectus contained in such
registration statement, and any post-effective amendments thereto.

     "REMARKETING AGENT" has the meaning set forth in Section 5.02(b).

     "REMARKETING AGREEMENT" means the Remarketing Agreement, dated as of
________________, 2003, between the Company and the Remarketing Agent.

     "REORGANIZATION EVENT" has the meaning set forth in Section 5.04(b).

     "RESPONSIBLE OFFICER" means, with respect to the Purchase Contract Agent,
any officer of the Purchase Contract Agent assigned by the Purchase Contract
Agent to administer this Purchase Contract Agreement.

     "SECURITIES ACT" means the Securities Act of 1933 and any statute successor
thereto, in each case as amended from time to time, and the rules and
regulations promulgated thereunder.

     "SECURITIES INTERMEDIARY" means [            ], as Securities Intermediary
under the Pledge Agreement until a successor Securities Intermediary shall have
become such pursuant to the applicable provisions of the Pledge Agreement, and
thereafter "Securities Intermediary" shall mean such successor.

     "SECURITY" means a Stock Purchase Unit or a Treasury Stock Purchase Unit,
as the case may be.

     "SECURITY REGISTER" and "SECURITIES REGISTRAR" have the respective meanings
set forth in Section 3.05.

     "SETTLEMENT RATE" has the meaning set forth in Section 5.01.

                                        9


     "STATED AMOUNT" means $[ ].

     "STOCK PURCHASE UNIT" means the collective rights and obligations of a
Holder of a Stock Purchase Units Certificate in respect of a Preferred Security,
the [Subordinated] Notes or an appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, subject in each case to the Pledge
thereof, and the related Purchase Contract; PROVIDED that the appropriate
Applicable Ownership Interest (as specified in clause (B) of the definition of
such term) of the Treasury Portfolio shall not be subject to the Pledge.

     "STOCK PURCHASE UNITS CERTIFICATE" means a certificate evidencing the
rights and obligations of a Holder in respect of the number of Stock Purchase
Units specified on such certificate.

     "[SUBORDINATED] NOTES" means the series of [Subordinated] Notes issued by
the Company under the Indenture and held by the Property Trustee.

     "TERMINATION DATE" means the date, if any, on which a Termination Event
occurs.

     "TERMINATION EVENT" means the occurrence of any of the following events:

            (i)  at any time on or prior to the Purchase Contract Settlement
     Date, a judgment, decree or court order shall have been entered granting
     relief under the Bankruptcy Code, adjudicating the Company to be insolvent,
     or approving as properly filed a petition seeking reorganization or
     liquidation of the Company or any other similar applicable Federal or State
     law, and, unless such judgment, decree or order shall have been entered
     within 60 days prior to the Purchase Contract Settlement Date, such decree
     or order shall have continued undischarged and unstayed for a period of 60
     days;

           (ii)  a judgment, decree or court order for the appointment of a
     receiver or liquidator or trustee or assignee in bankruptcy or insolvency
     of the Company or of its property, or for the termination or liquidation of
     its affairs, shall have been entered, and, unless such judgment, decree or
     order shall have been entered within 60 days prior to the Purchase Contract
     Settlement Date, such judgment, decree or order shall have continued
     undischarged and unstayed for a period of 60 days; or

          (iii)  at any time on or prior to the Purchase Contract Settlement
     Date, the Company shall file a petition for relief under the Bankruptcy
     Code, or shall consent to the filing of a bankruptcy proceeding against it,
     or shall file a petition or answer or consent seeking reorganization or
     liquidation under the Bankruptcy Code or any other similar applicable
     Federal or State law, or shall consent to the filing of any such petition,
     or shall consent to the appointment of a receiver or liquidator or trustee
     or assignee in bankruptcy or insolvency of it or of its property, or shall
     make an assignment for the benefit of creditors, or shall admit in writing
     its inability to pay its debts generally as they become due.

                                       10


     "THRESHOLD APPRECIATION PRICE" has the meaning set forth in Section 5.01.

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

     "TRADING DAY" has the meaning set forth in Section 5.01.

     "TREASURY STOCK PURCHASE UNIT" means, following the substitution of
Treasury Securities for Preferred Securities or [Subordinated] Notes as
collateral to secure a Holder's obligations under the Purchase Contract, the
collective rights and obligations of a Holder of a Treasury Stock Purchase Units
Certificate in respect of such Treasury Securities, subject to the Pledge
thereof, and the related Purchase Contract.

     "TREASURY STOCK PURCHASE UNITS CERTIFICATE" means a certificate evidencing
the rights and obligations of a Holder in respect of the number of Treasury
Stock Purchase Units specified on such certificate.

     "TREASURY SECURITIES" means zero-coupon U.S. Treasury Securities (CUSIP No.
______________) which mature on _________________.

     "TRUST" means CC Funding Trust II, a statutory trust formed under the laws
of the State of Delaware, or any successor thereto by merger or consolidation.

     "UNDERWRITING AGREEMENT" means the Underwriting Agreement, dated as of
__________, 2003, between the Company, the Trust and the Underwriters identified
in Schedule A thereto.

     "VICE PRESIDENT" 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 1.02. COMPLIANCE CERTIFICATES AND OPINIONS.

     Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Purchase Contract Agent to take any
action in accordance with any provision of this Agreement, the Company shall
furnish to the Purchase Contract Agent an Officers' Certificate stating that all
conditions precedent, if any, provided for in this Agreement relating to the
proposed action have been complied with and, if requested by the Purchase
Contract Agent, an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Agreement
relating to such particular application or request, no additional certificate or
opinion need be furnished.

                                       11


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

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

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

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

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

     SECTION 1.03. FORM OF DOCUMENTS DELIVERED TO PURCHASE CONTRACT AGENT.

     In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents. Any
certificate or opinion of an officer of the Company may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations
by, counsel, unless such officer knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
the matters upon which his certificate or opinion is based are erroneous. Any
such certificate or Opinion of Counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an
officer or officers of the Company stating that the information with respect to
such factual matters is in the possession of the Company unless such counsel
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters are erroneous.

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

     SECTION 1.04. ACTS OF HOLDERS; RECORD DATES.

     (a) Any request, demand, authorization, direction, notice, consent, waiver
or other

                                       12


action provided by this Agreement to be given or taken by Holders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an 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 Purchase
Contract Agent 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
Agreement and (subject to Section 7.01) conclusive in favor of the Purchase
Contract Agent 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 in any manner which the Purchase Contract Agent 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 Certificate evidencing such 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
Purchase Contract Agent or the Company in reliance thereon, whether or not
notation of such action is made upon such Certificate.

     (e) The Company may set any date as a record date for the purpose of
determining the Holders of Outstanding Securities entitled to give, make or take
any request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Agreement to be given, made or taken by
Holders of Securities. If any record date is set pursuant to this paragraph, the
Holders of the Outstanding Stock Purchase Units and the Outstanding Treasury
Stock Purchase Units, as the case may be, on such record date, and no other
Holders, shall be entitled to take the relevant action with respect to the Stock
Purchase Units or the Treasury Stock Purchase Units, as the case may be, whether
or not such Holders remain Holders after such record date; PROVIDED that no such
action shall be effective hereunder unless taken prior to or on the applicable
Expiration Date by Holders of the requisite number of Outstanding Securities on
such record date. Nothing contained 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 be of no effect), and nothing contained in this paragraph shall
be construed to render ineffective any action taken by Holders of the requisite
number of Outstanding Securities 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 Purchase Contract Agent in
writing and to each Holder of Securities in the manner set forth in Section
1.06.

                                       13


     With respect to any record date set pursuant to this Section, the Company
may designate any date 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 Purchase Contract Agent in writing, and to each Holder of Securities in the
manner set forth in Section 1.06, prior to or on the existing Expiration Date.
If an Expiration Date is not designated with respect to any record date set
pursuant to this Section, the Company 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. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.

     SECTION 1.05. NOTICES.

     Any notice or communication is duly given if in writing and delivered in
Person or mailed by first-class mail (registered or certified, return receipt
requested), telecopier (with receipt confirmed) or overnight air courier
guaranteeing next day delivery, to the others' address; provided that notice
shall be deemed given to the Purchase Contract Agent only upon receipt thereof:

     If to the Purchase Contract Agent:

          [                           ]
          [                           ]
          [                           ]
          Telecopier No.:
          Attention:

     If to the Company:
          Cinergy Corp.
          139 East Fourth Street
          Cincinnati, OH 45202
          Telecopier No.:
          Attention:

     with a copy to:

          [                           ]
          [                           ]

                                       14


     If to the Collateral Agent:
          [                           ]
          [                           ]
          [                           ]
          [                           ]
          [                           ]
          Telecopier No.:
          Attention:

     If to the Property Trustee:
          [                           ]
          [                           ]
          [                           ]
          Telecopier No.:
          Attention:

     If to the Indenture Trustee:
          [                           ]
          [                           ]
          [                           ]
          [                           ]
          [                           ]
          Telecopier No.:
          Attention:

     SECTION 1.06. NOTICE TO HOLDERS; WAIVER.

     Where this Agreement 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 its address as it appears in the Security Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to 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 Agreement 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
Purchase Contract Agent, but such filing shall not be a condition precedent to
the validity of any action taken in reliance upon such waiver.

     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 Purchase Contract Agent
shall constitute a sufficient notification for every

                                       15


purpose hereunder.

     SECTION 1.07. EFFECT OF HEADINGS AND TABLE OF CONTENTS.

     The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.

     SECTION 1.08. SUCCESSORS AND ASSIGNS.

     All covenants and agreements in this Agreement by the Company and the
Purchase Contract Agent shall bind their respective successors and assigns,
whether so expressed or not.

     SECTION 1.09. SEPARABILITY CLAUSE.

     In case any provision in this Agreement or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof and thereof shall not in any way be affected or
impaired thereby.

     SECTION 1.10. BENEFITS OF AGREEMENT.

     Nothing contained in this Agreement or in the Securities, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and, to the extent provided hereby, the Holders, any
benefits or any legal or equitable right, remedy or claim under this Agreement.
The Holders from time to time shall be beneficiaries of this Agreement and shall
be bound by all of the terms and conditions hereof and of the Securities
evidenced by their Certificates by their acceptance of delivery of such
Certificates.

     SECTION 1.11. GOVERNING LAW.

     This Agreement and the Securities shall be governed by, and construed in
accordance with, the laws of the State of New York.

     SECTION 1.12. LEGAL HOLIDAYS.

     In any case where any Payment Date shall not be a Business Day
(notwithstanding any other provision of this Agreement or the Securities),
Purchase Contract Payments or other distributions shall not be paid on such
date, but Purchase Contract Payments or such other distributions shall be paid
on the next succeeding Business Day with the same force and effect as if made on
such Payment Date, PROVIDED that no interest shall accrue or be payable by the
Company or to any Holder for the period from and after any such Payment Date,
except that, if such next succeeding Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day with the same force and effect as if made on such Payment Date.

                                       16


     In any case where any Purchase Contract Settlement Date or Early Settlement
Date shall not be a Business Day (notwithstanding any other provision of this
Agreement or the Securities) Purchase Contracts shall not be performed and Early
Settlement shall not be effected on such date, but Purchase Contracts shall be
performed or Early Settlement effected, as applicable, on the next succeeding
Business Day with the same force and effect as if made on such Purchase Contract
Settlement Date or Early Settlement Date, as applicable.

     SECTION 1.13. COUNTERPARTS.

     This Agreement may be executed in any number of counterparts by the parties
hereto on separate counterparts, each of which, when so executed and delivered,
shall be deemed an original, but all such counterparts shall together constitute
one and the same instrument.

     SECTION 1.14. INSPECTION OF AGREEMENT.

     A copy of this Agreement shall be available at all reasonable times during
normal business hours at the Corporate Trust Office for inspection by any Holder
or Beneficial Owner.

     SECTION 1.15. APPOINTMENT OF FINANCIAL INSTITUTION AS AGENT FOR THE
COMPANY.

     The Company may appoint a financial institution (which may be the
Collateral Agent) to act as its agent in performing its obligations and in
accepting and enforcing performance of the obligations of the Purchase Contract
Agent and the Holders, under this Agreement and the Purchase Contracts, by
giving notice of such appointment in the manner provided in Section 1.05 hereof.
Any such appointment shall not relieve the Company in any way from its
obligations hereunder.

                                    ARTICLE 2
                                CERTIFICATE FORMS

     SECTION 2.01. FORMS OF CERTIFICATES GENERALLY.

     The Certificates (including the form of Purchase Contract forming part of
each Security evidenced thereby) shall be in substantially the form set forth in
Exhibit A hereto (in the case of Certificates evidencing Stock Purchase Units)
or Exhibit B hereto (in the case of Certificates evidencing Treasury Stock
Purchase Units), with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or engraved
thereon as may be required by the rules of any securities exchange on which the
Securities are listed or any depositary therefor, or as may, consistently
herewith, be determined by the officers of the Company executing such
Certificates, as evidenced by their execution of the Certificates.

     The definitive Certificates shall be printed, lithographed or engraved on
steel engraved

                                       17


borders or may be produced in any other manner, all as determined by the
officers of the Company executing the Securities evidenced by such Certificates,
consistent with the provisions of this Agreement, as evidenced by their
execution thereof.

     Every Global Certificate authenticated, executed on behalf of the Holders
and delivered hereunder shall bear a legend in substantially the following form:

     "THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
     PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN
     THE NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE
     "DEPOSITARY"), OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS
     EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN
     THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED
     IN THE PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE
     (OTHER THAN A TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO
     A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
     DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT
     IN LIMITED CIRCUMSTANCES.

     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
     DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
     CERTIFICATE ISSUED IS REQUESTED IN THE NAME OF CEDE & CO. OR SUCH OTHER
     NAME AS REGISTERED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND
     ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
     REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER,
     PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
     WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
     HEREIN."

     SECTION 2.02. FORM OF PURCHASE CONTRACT AGENT'S CERTIFICATE OF
AUTHENTICATION.

     The form of the Purchase Contract Agent's certificate of authentication of
the Securities shall be in substantially the form set forth on the form of the
applicable Certificates.

                                       18


                                    ARTICLE 3
                                 THE SECURITIES

     SECTION 3.01. AMOUNT; FORM AND DENOMINATIONS.

     The aggregate number of Securities evidenced by Certificates authenticated,
executed on behalf of the Holders and delivered hereunder is limited to
______________ [(_____________ if the over-allotment option granted in the
Underwriting Agreement is exercised in full)], except for Certificates
authenticated, executed and delivered upon registration of transfer of, in
exchange for, or in lieu of, other Certificates pursuant to Sections 3.04, 3.05,
3.10, 3.13, 3.14, 5.07 or 8.05.

     The Certificates shall be issuable only in registered form and only in
denominations of a single Stock Purchase Unit or Treasury Stock Purchase Unit
and any integral multiple thereof.

     SECTION 3.02. RIGHTS AND OBLIGATIONS EVIDENCED BY THE CERTIFICATES.

     Each Stock Purchase Units Certificate shall evidence the number of Stock
Purchase Units specified therein, with each such Stock Purchase Unit
representing (1) the ownership by the Holder thereof of a beneficial interest in
a Preferred Security, a [Subordinated] Note or the Applicable Ownership Interest
of the Treasury Portfolio, as the case may be, subject to the Pledge of such
Preferred Security, such [Subordinated] Note or the Applicable Ownership
Interest (as specified in clause (A) of the definition of such term) of the
Treasury Portfolio, as the case may be, by such Holder pursuant to the Pledge
Agreement, and (2) the rights and obligations of the Holder thereof and the
Company under one Purchase Contract. The Purchase Contract Agent, as
attorney-in-fact for, and on behalf of, the Holder of each Stock Purchase Unit
shall pledge, pursuant to the Pledge Agreement, the Preferred Security, the
[Subordinated] Note or the Applicable Ownership Interest (as specified in clause
(A) of the definition of such term) of the Treasury Portfolio, as the case may
be, forming a part of such Stock Purchase Unit, to the Collateral Agent and
grant to the Collateral Agent a security interest in the right, title and
interest of such Holder in such Preferred Security, such [Subordinated] Note or
the Applicable Ownership Interest (as specified in clause (A) of the definition
of such term) of the Treasury Portfolio, as the case may be, for the benefit of
the Company, to secure the obligation of the Holder under each Purchase Contract
to purchase shares of Common Stock.

     Upon the formation of a Treasury Stock Purchase Unit pursuant to Section
3.13, each Treasury Stock Purchase Units Certificate shall evidence the number
of Treasury Stock Purchase Units specified therein, with each such Treasury
Stock Purchase Unit representing (1) the ownership by the Holder thereof of a
1/40 undivided beneficial interest in a Treasury Security with a principal
amount equal to $1,000, subject to the Pledge of such Treasury Security by such
Holder pursuant to the Pledge Agreement, and (2) the rights and obligations of
the Holder thereof and the Company under one Purchase Contract.

                                       19


     Prior to the purchase of shares of Common Stock under each Purchase
Contract, such Purchase Contracts shall not entitle the Holder of a Security to
any of the rights of a holder of shares of Common Stock, including, without
limitation, the right to vote or receive any dividends or other payments or to
consent or to receive notice as a shareholder in respect of the meetings of
shareholders or for the election of directors of the Company or for any other
matter, or any other rights whatsoever as a shareholder of the Company.

     SECTION 3.03. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.

     Subject to the provisions of Sections 3.13 and 3.14 hereof, upon the
execution and delivery of this Agreement, and at any time and from time to time
thereafter, the Company may deliver Certificates executed by the Company to the
Purchase Contract Agent for authentication, execution on behalf of the Holders
and delivery, together with its Issuer Order for authentication of such
Certificates, and the Purchase Contract Agent in accordance with such Issuer
Order shall authenticate, execute on behalf of the Holders and deliver such
Certificates.

     The Certificates shall be executed on behalf of the Company by its Chairman
of the Board, its President or one of its Vice Presidents. The signature of any
of these officers on the Certificates may be manual or facsimile.

     Certificates 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 Certificates or did not
hold such offices at the date of such Certificates.

     No Purchase Contract evidenced by a Certificate shall be valid until such
Certificate has been executed on behalf of the Holder by the manual signature of
an authorized signatory of the Purchase Contract Agent, as such Holder's
attorney-in-fact. Such signature by an authorized signatory of the Purchase
Contract Agent shall be conclusive evidence that the Holder of such Certificate
has entered into the Purchase Contracts evidenced by such Certificate.

     Each Certificate shall be dated the date of its authentication.

     No Certificate shall be entitled to any benefit under this Agreement or be
valid or obligatory for any purpose unless there appears on such Certificate a
certificate of authentication substantially in the form provided for herein
executed by an authorized signatory of the Purchase Contract Agent by manual
signature, and such certificate upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder.

     SECTION 3.04. TEMPORARY CERTIFICATES.

     Pending the preparation of definitive Certificates, the Company shall
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall authenticate, execute on

                                       20


behalf of the Holders, and deliver, in lieu of such definitive Certificates,
temporary Certificates which are in substantially the form set forth in Exhibit
A or Exhibit B hereto, as the case may be, with such letters, numbers or other
marks of identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Stock Purchase Units or Treasury Stock Purchase
Units, as the case may be, are listed, or as may, consistently herewith, be
determined by the officers of the Company executing such Certificates, as
evidenced by their execution of the Certificates.

     If temporary Certificates are issued, the Company will cause definitive
Certificates to be prepared without unreasonable delay. After the preparation of
definitive Certificates, the temporary Certificates shall be exchangeable for
definitive Certificates upon surrender of the temporary Certificates at the
Corporate Trust Office, at the expense of the Company and without charge to the
Holder. Upon surrender for cancellation of any one or more temporary
Certificates, the Company shall execute and deliver to the Purchase Contract
Agent, and the Purchase Contract Agent shall authenticate, execute on behalf of
the Holder, and deliver in exchange therefor, one or more definitive
Certificates of like tenor and denominations and evidencing a like number of
Securities as the temporary Certificate or Certificates so surrendered. Until so
exchanged, the temporary Certificates shall in all respects evidence the same
benefits and the same obligations with respect to the Securities, evidenced
thereby as definitive Certificates.

     SECTION 3.05. REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE.

     The Purchase Contract Agent shall keep at the Corporate Trust Office a
register (the "SECURITY REGISTER") in which, subject to such reasonable
regulations as it may prescribe, the Purchase Contract Agent shall provide for
the registration of Certificates and of transfers of Certificates (the Purchase
Contract Agent, in such capacity, the "SECURITY REGISTRAR"). The Security
Registrar shall record separately the registration and transfer of the
Certificates evidencing Stock Purchase Units and Treasury Stock Purchase Units.

     Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office, the Company shall execute and deliver to the Purchase
Contract Agent, and the Purchase Contract Agent shall authenticate, execute on
behalf of the designated transferee or transferees, and deliver, in the name of
the designated transferee or transferees, one or more new Certificates of any
authorized denominations, like tenor, and evidencing a like number of Stock
Purchase Units or Treasury Stock Purchase Units, as the case may be.

     At the option of the Holder, Certificates may be exchanged for other
Certificates, of any authorized denominations and evidencing a like number of
Stock Purchase Units or Treasury Stock Purchase Units, as the case may be, upon
surrender of the Certificates to be exchanged at the Corporate Trust Office.
Whenever any Certificates are so surrendered for exchange, the Company shall
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall authenticate, execute on behalf of the Holder, and deliver the
Certificates which the Holder making the exchange is entitled to receive.

                                       21


     All Certificates issued upon any registration of transfer or exchange of a
Certificate shall evidence the ownership of the same number of Stock Purchase
Units or Treasury Stock Purchase Units, as the case may be, and be entitled to
the same benefits and subject to the same obligations, under this Agreement as
the Stock Purchase Units or Treasury Stock Purchase Units, as the case may be,
evidenced by the Certificate surrendered upon such registration of transfer or
exchange.

     Every Certificate presented or surrendered for registration of transfer or
exchange shall (if so required by the Purchase Contract Agent) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Purchase Contract Agent duly executed, by the Holder thereof
or its attorney duly authorized in writing.

     No service charge shall be made for any registration of transfer or
exchange of a Certificate, but the Company and the Purchase Contract Agent may
require payment from the Holder 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 Certificates, other than any exchanges pursuant to
Sections 3.06 and 8.05 not involving any transfer.

     Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall not be obligated to authenticate, execute on behalf of the Holder
and deliver any Certificate in exchange for any other Certificate presented or
surrendered for registration of transfer or for exchange on or after the
Business Day immediately preceding the earliest of any Early Settlement Date for
such Certificate, the Purchase Contract Settlement Date or the Termination Date.
In lieu of delivery of a new Certificate, upon satisfaction of the applicable
conditions specified above in this Section and receipt of appropriate
registration or transfer instructions from such Holder, the Purchase Contract
Agent shall:

            (i)  if the Purchase Contract Settlement Date or an Early Settlement
     Date with respect to such other Certificate has occurred, deliver the
     shares of Common Stock issuable in respect of the Purchase Contracts
     forming a part of the Securities evidenced by such other Certificate; or

           (ii)  if a Cash Settlement or an Early Settlement Date with respect
     to such other Certificate shall have occurred, or if a Termination Event
     shall have occurred prior to the Purchase Contract Settlement Date,
     transfer the Preferred Securities, the [Subordinated] Notes, the Treasury
     Securities, or the appropriate Applicable Ownership Interest of the
     Treasury Portfolio, as the case may be, evidenced thereby, in each case
     subject to the applicable conditions and in accordance with the applicable
     provisions of Section 3.15 and Article Five hereof.

                                       22


     SECTION 3.06. BOOK-ENTRY INTERESTS.

     The Certificates, on original issuance, will be issued in the form of one
or more fully registered Global Certificates, to be delivered to the Depositary
or its custodian by, or on behalf of, the Company. The Company hereby designates
DTC as the initial Depositary. Such Global Certificates shall initially be
registered on the books and records of the Company in the name of Cede & Co.,
the nominee of the Depositary, and no Beneficial Owner will receive a definitive
Certificate representing such Beneficial Owner's interest in such Global
Certificate, except as provided in Section 3.09. The Purchase Contract Agent
shall enter into an agreement with the Depositary if so requested by the
Company. Unless and until definitive, fully registered Certificates have been
issued to Beneficial Owners pursuant to Section 3.09:

            (i)  the provisions of this Section 3.06 shall be in full force and
     effect;

           (ii)  the Company shall be entitled to deal with the Depositary for
     all purposes of this Agreement (including making Purchase Contract Payments
     and receiving approvals, votes or consents hereunder) as the Holder of the
     Securities and the sole holder of the Global Certificates and shall have no
     obligation to the Beneficial Owners;

          (iii)  to the extent that the provisions of this Section 3.06 conflict
     with any other provisions of this Agreement, the provisions of this Section
     3.06 shall control; and

           (iv)  the rights of the Beneficial Owners shall be exercised only
     through the Depositary and shall be limited to those established by law and
     agreements between such Beneficial Owners and the Depositary or the
     Depositary Participants.

     SECTION 3.07. NOTICES TO HOLDERS.

     Whenever a notice or other communication to the Holders is required to be
given under this Agreement, the Company or the Company's agent shall give such
notices and communications to the Holders and, with respect to any Securities
registered in the name of the Depositary or the nominee of the Depositary, the
Company or the Company's agent shall, except as set forth herein, have no
obligations to the Beneficial Owners.

     SECTION 3.08. APPOINTMENT OF SUCCESSOR DEPOSITARY.

     If the Depositary elects to discontinue its services as securities
depositary with respect to the Securities, the Company may, in its sole
discretion, appoint a successor Depositary with respect to the Securities.

                                       23


     SECTION 3.09. DEFINITIVE CERTIFICATES.

     If:

            (i)  the Depositary elects to discontinue its services as securities
     depositary with respect to the Securities and a successor Depositary is not
     appointed within 90 days after such discontinuance pursuant to Section
     3.08; or

           (ii)  the Company elects, after consultation with the Purchase
     Contract Agent, to terminate the book-entry system for the Securities,

then (x) definitive Certificates shall be prepared by the Company with respect
to such Securities and delivered to the Purchase Contract Agent and (y) upon
surrender of the Global Certificates representing the Securities by the
Depositary, accompanied by registration instructions, the Company shall cause
definitive Certificates to be delivered to Beneficial Owners in accordance with
the instructions of the Depositary. The Company shall not be liable for any
delay in delivery of such instructions and may conclusively rely on and shall be
protected in relying on, such instructions. Each definitive Certificate so
delivered shall evidence Securities of the same kind and tenor as the Global
Certificate so surrendered in respect thereof.

     SECTION 3.10. MUTILATED, DESTROYED, LOST AND STOLEN CERTIFICATES.

     If any mutilated Certificate is surrendered to the Purchase Contract Agent,
the Company shall execute and deliver to the Purchase Contract Agent, and the
Purchase Contract Agent shall authenticate, execute on behalf of the Holder, and
deliver in exchange therefor, a new Certificate, evidencing the same number of
Stock Purchase Units or Treasury Stock Purchase Units, as the case may be, and
bearing a Certificate number not contemporaneously outstanding.

     If there shall be delivered to the Company and the Purchase Contract Agent
(i) evidence to their satisfaction of the destruction, loss or theft of any
Certificate, and (ii) such security or indemnity as may be required by them to
hold each of them and any agent of any of them harmless, then, in the absence of
notice to the Company or the Purchase Contract Agent that such Certificate has
been acquired by a protected purchaser, the Company shall execute and deliver to
the Purchase Contract Agent, and the Purchase Contract Agent shall authenticate,
execute on behalf of the Holder, and deliver to the Holder, in lieu of any such
destroyed, lost or stolen Certificate, a new Certificate, evidencing the same
number of Stock Purchase Units or Treasury Stock Purchase Units, as the case may
be, and bearing a Certificate number not contemporaneously outstanding.

     Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall not be obligated to authenticate, execute on behalf of the Holder,
and deliver to the Holder, a Certificate on or after the Business Day
immediately preceding the earliest of any Early Settlement Date for such lost or
mutilated Certificate, the Purchase Contract Settlement Date or the Termination
Date. In lieu of

                                       24


delivery of a new Certificate, upon satisfaction of the applicable conditions
specified above in this Section and receipt of appropriate registration or
transfer instructions from such Holder, the Purchase Contract Agent shall:

            (i)  if the Purchase Contract Settlement Date or an Early Settlement
     Date with respect to such lost or mutilated Certificate has occurred,
     deliver the shares of Common Stock issuable in respect of the Purchase
     Contracts forming a part of the Securities evidenced by such Certificate;
     or

           (ii)  if a Cash Settlement or an Early Settlement Date with respect
     to such lost or mutilated Certificate shall have occurred or if a
     Termination Event shall have occurred prior to the Purchase Contract
     Settlement Date, transfer the Preferred Securities, the [Subordinated]
     Notes, the Treasury Securities or the appropriate Applicable Ownership
     Interest (as specified in clause (A) of the definition of such term) of the
     Treasury Portfolio, as the case may be, evidenced thereby, in each case
     subject to the applicable conditions and in accordance with the applicable
     provisions of Section 3.15 and Article Five hereof.

     Upon the issuance of any new Certificate under this Section, the Company
and the Purchase Contract Agent may require the payment by the Holder 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
Purchase Contract Agent) connected therewith.

     Every new Certificate issued pursuant to this Section in lieu of any
destroyed, lost or stolen Certificate shall constitute an original additional
contractual obligation of the Company and of the Holder in respect of the
Security evidenced thereby, whether or not the destroyed, lost or stolen
Certificate (and the Securities evidenced thereby) shall be at any time
enforceable by anyone, and shall be entitled to all the benefits and be subject
to all the obligations of this Agreement equally and proportionately with any
and all other Certificates delivered hereunder.

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

     SECTION 3.11. PERSONS DEEMED OWNERS.

     Prior to due presentment of a Certificate for registration of transfer, the
Company and the Purchase Contract Agent, and any agent of the Company or the
Purchase Contract Agent, may treat the Person in whose name such Certificate is
registered as the owner of the Security evidenced thereby, for the purpose of
receiving distributions on the Preferred Securities, the Treasury Securities,
the [Subordinated] Notes, or on the maturing quarterly interest strips of the
Treasury Portfolio, as applicable, receiving Purchase Contract Payments,
performance of the Purchase Contracts and for all other purposes whatsoever,
whether or not any distributions on the

                                       25


Preferred Securities, the Treasury Securities, the [Subordinated] Notes, or
Treasury Portfolio, as applicable, or Purchase Contract Payments payable on the
Purchase Contracts, each constituting a part of the Security evidenced thereby
shall be overdue and notwithstanding any notice to the contrary, and neither the
Company nor the Purchase Contract Agent, nor any agent of the Company or the
Purchase Contract Agent, shall be affected by notice to the contrary.

     Notwithstanding the foregoing, with respect to any Global Certificate,
nothing contained herein shall prevent the Company, the Purchase Contract Agent
or any agent of the Company or the Purchase Contract Agent, from giving effect
to any written certification, proxy or other authorization furnished by the
Depositary (or its nominee), as a Holder, with respect to such Global
Certificate or impair, as between such Depositary and the related Beneficial
Owner, the operation of customary practices governing the exercise of rights of
the Depositary (or its nominee) as Holder of such Global Certificate.

     SECTION 3.12. CANCELLATION.

     All Certificates surrendered for delivery of shares of Common Stock on or
after the Purchase Contract Settlement Date, upon the transfer of Preferred
Securities, [Subordinated] Notes, the appropriate Applicable Ownership Interest
(as specified in clause (A) of the definition of that term) of the Treasury
Portfolio or Treasury Securities, as the case may be, after the occurrence of a
Termination Event or pursuant to an Early Settlement, or upon the registration
of transfer or exchange of a Security, or a Collateral Substitution or the
reestablishment of Stock Purchase Units shall, if surrendered to any Person
other than the Purchase Contract Agent, be delivered to the Purchase Contract
Agent and, if not already cancelled, shall be promptly cancelled by it. The
Company may at any time deliver to the Purchase Contract Agent for cancellation
any Certificates previously authenticated, executed and delivered hereunder
which the Company may have acquired in any manner whatsoever, and all
Certificates so delivered shall, upon Issuer Order, be promptly cancelled by the
Purchase Contract Agent. No Certificates shall be authenticated, executed on
behalf of the Holder and delivered in lieu of or in exchange for any
Certificates cancelled as provided in this Section, except as expressly
permitted by this Agreement. All cancelled Certificates held by the Purchase
Contract Agent shall be disposed of in accordance with its customary practices.

     If the Company or any Affiliate of the Company shall acquire any
Certificate, such acquisition shall not operate as a cancellation of such
Certificate unless and until such Certificate is delivered to the Purchase
Contract Agent cancelled or for cancellation.

     SECTION 3.13. CREATION OF TREASURY STOCK PURCHASE UNITS BY SUBSTITUTION OF
TREASURY SECURITIES.

     Subject to the conditions set forth in this Agreement, a Holder may
separate the Preferred Securities or the [Subordinated] Notes, as applicable,
from the related Purchase Contracts in respect of such Holder's Stock Purchase
Units by substituting for such Preferred Securities or [Subordinated] Notes, as
applicable, Treasury Securities in an aggregate principal amount equal

                                       26


to the aggregate liquidation amount of such Preferred Securities or the
aggregate principal amount of such [Subordinated] Notes, as applicable (a
"COLLATERAL SUBSTITUTION"), at any time from and after the date of this
Agreement and prior to or on the seventh Business Day immediately preceding the
Purchase Contract Settlement Date. To effect such substitution, the Holder must:

            (1)  deposit with the Securities Intermediary Treasury Securities
                 having an aggregate principal amount equal to the aggregate
                 liquidation amount of the Preferred Securities or the aggregate
                 principal amount of the [Subordinated] Notes comprising part of
                 such Stock Purchase Units, as the case may be; and

            (2)  transfer the related Stock Purchase Units to the Purchase
                 Contract Agent accompanied by a notice to the Purchase Contract
                 Agent, substantially in the form of Exhibit C hereto, (i)
                 stating that the Holder has transferred the relevant amount of
                 Treasury Securities to the Securities Intermediary and (ii)
                 requesting that the Purchase Contract Agent instruct the
                 Collateral Agent to release the Preferred Securities or the
                 [Subordinated] Notes, as the case may be, underlying such Stock
                 Purchase Units, whereupon the Purchase Contract Agent shall
                 promptly provide an instruction to such effect to the
                 Collateral Agent, substantially in the form of Exhibit A to the
                 Pledge Agreement.

     Upon receipt of the Treasury Securities described in clause (1) above and
the instruction described in clause (2) above, in accordance with the terms of
the Pledge Agreement, the Collateral Agent will cause the Securities
Intermediary to effect the release of such Preferred Securities or the
[Subordinated] Notes, as the case may be, from the Pledge, free and clear of the
Company's security interest therein, and the transfer of such Preferred
Securities or the [Subordinated] Notes, as the case may be, to the Purchase
Contract Agent on behalf of the Holder. Upon receipt thereof, the Purchase
Contract Agent shall promptly:

            (i)  cancel the related Stock Purchase Units;

           (ii)  transfer the Preferred Securities or the [Subordinated] Notes,
     as the case may be, to the Holder; and

          (iii)  authenticate, execute on behalf of such Holder and deliver a
     Treasury Stock Purchase Units Certificate executed by the Company in
     accordance with Section 3.03 evidencing the same number of Purchase
     Contracts as were evidenced by the cancelled Stock Purchase Units.

     Holders who elect to separate the Preferred Securities or the
[Subordinated] Notes, as the case may be, from the related Purchase Contracts
and to substitute Treasury Securities for such Preferred Securities or the
[Subordinated] Notes, as the case may be, shall be responsible for any fees or
expenses payable to the Collateral Agent for its services as Collateral Agent in
respect of

                                       27


the substitution, and the Company shall not be responsible for any such fees or
expenses.

     Holders may make Collateral Substitutions only in integral multiples of 40
Stock Purchase Units. If a Tax Event Redemption has occurred, Holders may no
longer convert their Stock Purchase Units into Treasury Stock Purchase Units.

     In the event a Holder making a Collateral Substitution pursuant to this
Section 3.13 fails to effect a book-entry transfer of the Stock Purchase Units
or fails to deliver Stock Purchase Units Certificates to the Purchase Contract
Agent after depositing Treasury Securities with the Collateral Agent, any
distributions on the Preferred Securities or the [Subordinated] Notes
constituting a part of such Stock Purchase Units, as the case may be, shall be
held in the name of the Purchase Contract Agent or its nominee in trust for the
benefit of such Holder, until such Stock Purchase Units are so transferred or
the Stock Purchase Units Certificate is so delivered, as the case may be, or,
such Holder provides evidence satisfactory to the Company and the Purchase
Contract Agent that such Stock Purchase Units Certificate has been destroyed,
lost or stolen, together with any indemnity that may be required by the Purchase
Contract Agent and the Company.

     Except as described in this Section 3.13 or in connection with a Cash
Settlement, for so long as the Purchase Contract underlying a Stock Purchase
Unit remains in effect, such Stock Purchase Unit shall not be separable into its
constituent parts, and the rights and obligations of the Holder in respect of
the Preferred Securities or the [Subordinated] Notes, as the case may be, and
the Purchase Contract comprising such Stock Purchase Unit may be acquired, and
may be transferred and exchanged, only as a Stock Purchase Unit.

     SECTION 3.14. REESTABLISHMENT OF STOCK PURCHASE UNITS.

     Subject to the conditions set forth in this Agreement, a Holder of Treasury
Stock Purchase Units may reestablish Stock Purchase Units at any time (i) prior
to or on the seventh Business Day immediately preceding the Purchase Contract
Settlement Date, by:

            (1)  depositing with the Securities Intermediary Preferred
                 Securities or [Subordinated] Notes, as the case may be, having
                 an aggregate liquidation amount (in the case of Preferred
                 Securities) or aggregate principal amount (in the case of
                 [Subordinated] Notes), as the case may be, equal to the
                 aggregate principal amount at maturity of the Treasury
                 Securities comprising part of the Treasury Stock Purchase
                 Units; and

            (2)  transferring the related Treasury Stock Purchase Units to the
                 Purchase Contract Agent accompanied by a notice to the Purchase
                 Contract Agent, substantially in the form of Exhibit C hereto,
                 (i) stating that the Holder has transferred the relevant amount
                 of Preferred Securities or [Subordinated] Notes, as the case
                 may be, to the Securities Intermediary and (ii) requesting that
                 the Purchase Contract Agent instruct the Collateral Agent to
                 release the

                                       28


                 Treasury Securities underlying such Treasury Stock Purchase
                 Units, whereupon the Purchase Contract Agent shall promptly
                 provide an instruction to such effect to the Collateral Agent,
                 substantially in the form of Exhibit C to the Pledge Agreement.

Upon receipt of the Preferred Securities or the [Subordinated] Notes, as the
case may be, described in clause (1) above and the instruction described in
clause (2) above, in accordance with the terms of the Pledge Agreement, the
Collateral Agent will cause the Securities Intermediary to effect the release of
the Treasury Securities having a corresponding aggregate principal amount at
maturity from the Pledge, free and clear of the Company's security interest
therein, and the transfer to the Purchase Contract Agent on behalf of the
Holder. Upon receipt thereof, the Purchase Contract Agent shall promptly:

            (i)  cancel the related Treasury Stock Purchase Units;

           (ii)  transfer the Treasury Securities to the Holder; and

          (iii)  authenticate, execute on behalf of such Holder and deliver a
     Stock Purchase Units Certificate executed by the Company in accordance with
     Section 3.03 evidencing the same number of Purchase Contracts as were
     evidenced by the cancelled Treasury Stock Purchase Units.

     Holders who elect to reestablish Stock Purchase Units shall be responsible
for any fees or expenses payable to the Collateral Agent for its services as
Collateral Agent in respect of the reestablishment, and the Company shall not be
responsible for any such fees or expenses.

     Holders of Treasury Stock Purchase Units may only reestablish Stock
Purchase Units in integral multiples of 40 Treasury Stock Purchase Units. If a
Tax Event Redemption has occurred, Holders may no longer convert their Treasury
Stock Purchase Units into Stock Purchase Units.

     Except as provided in this Section 3.14 or in connection with a Cash
Settlement, for so long as the Purchase Contract underlying a Treasury Stock
Purchase Unit remains in effect, such Treasury Stock Purchase Unit shall not be
separable into its constituent parts and the rights and obligations of the
Holder of such Treasury Stock Purchase Unit in respect of the 1/40 of a Treasury
Security and the Purchase Contract comprising such Treasury Stock Purchase Unit
may be acquired, and may be transferred and exchanged, only as a Treasury Stock
Purchase Unit.

     SECTION 3.15. TRANSFER OF COLLATERAL UPON OCCURRENCE OF TERMINATION EVENT.

     Upon the occurrence of a Termination Event and the transfer to the Purchase
Contract Agent of the Preferred Securities, [Subordinated] Notes, the
appropriate Applicable Ownership Interest of the Treasury Portfolio or the
Treasury Securities, as the case may be, underlying the

                                       29


Stock Purchase Units and the Treasury Stock Purchase Units, as the case may be,
pursuant to the terms of the Pledge Agreement, the Purchase Contract Agent shall
request transfer instructions with respect to such Preferred Securities,
[Subordinated] Notes, the appropriate Applicable Ownership Interest of the
Treasury Portfolio or Treasury Securities, as the case may be, from each Holder
by written request, substantially in the form of Exhibit D hereto, mailed to
such Holder at its address as it appears in the Security Register.

     Upon book-entry transfer of the Stock Purchase Units or the Treasury Stock
Purchase Units or delivery of a Stock Purchase Units Certificate or Treasury
Stock Purchase Units Certificate to the Purchase Contract Agent with such
transfer instructions, the Purchase Contract Agent shall transfer the Preferred
Securities, [Subordinated] Notes, the appropriate Applicable Ownership Interest
of the Treasury Portfolio or Treasury Securities, as the case may be, underlying
such Stock Purchase Units or Treasury Stock Purchase Units, as the case may be,
to such Holder by book-entry transfer, or other appropriate procedures, in
accordance with such instructions. In the event a Holder of Stock Purchase Units
or Treasury Stock Purchase Units fails to effect such transfer or delivery, the
Preferred Securities, [Subordinated] Notes, the appropriate Applicable Ownership
Interest of the Treasury Portfolio or Treasury Securities, as the case may be,
underlying such Stock Purchase Units or Treasury Stock Purchase Units, as the
case may be, and any distributions thereon, shall be held in the name of the
Purchase Contract Agent or its nominee in trust for the benefit of such Holder,
until the earlier to occur of:

            (i)  the transfer of such Stock Purchase Units or Treasury Stock
     Purchase Units or surrender of the Stock Purchase Units Certificate or
     Treasury Stock Purchase Units Certificate or receipt by the Company and the
     Purchase Contract Agent from such Holder of satisfactory evidence that such
     Stock Purchase Units Certificate or Treasury Stock Purchase Units
     Certificate has been destroyed, lost or stolen, together with any indemnity
     that may be required by the Purchase Contract Agent and the Company; and

           (ii)  the expiration of the time period specified in the abandoned
     property laws of the relevant State.

     SECTION 3.16. NO CONSENT TO ASSUMPTION.

     Each Holder of a Security, by acceptance thereof, shall be deemed expressly
to have withheld any consent to the assumption under Section 365 of the
Bankruptcy Code or otherwise, of the Purchase Contract by the Company or its
trustee, receiver, liquidator or a person or entity performing similar functions
in the event that the Company becomes the debtor under the Bankruptcy Code or
subject to other similar state or Federal law providing for reorganization or
liquidation.

                                       30


                                    ARTICLE 4
THE PREFERRED SECURITIES, [SUBORDINATED] NOTES AND APPLICABLE OWNERSHIP INTEREST
                            OF THE TREASURY PORTFOLIO

     SECTION 4.01. INTEREST PAYMENTS; RIGHTS TO INTEREST PAYMENTS PRESERVED.

     Any distribution on any Preferred Security, any [Subordinated] Note or on
the appropriate Applicable Ownership Interest of the Treasury Portfolio, as the
case may be, which is paid on any Payment Date shall, subject to receipt thereof
by the Purchase Contract Agent from the Collateral Agent as provided by the
terms of the Pledge Agreement, be paid to the Person in whose name the Stock
Purchase Units Certificate (or one or more Predecessor Stock Purchase Units
Certificates) of which such Preferred Security, such [Subordinated] Note or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, is registered at the close of business on the Record Date for such
Payment Date. Any such distribution shall be subject to deferral at the option
of the Company in accordance with the Indenture and the Declaration.

     Each Stock Purchase Units Certificate evidencing Preferred Securities,
[Subordinated] Notes or the appropriate Applicable Ownership Interest of the
Treasury Portfolio delivered under this Agreement upon registration of transfer
of or in exchange for or in lieu of any other Stock Purchase Units Certificate
shall carry the right to distributions accrued and unpaid, and to accrue
distributions interest, which were carried by the Preferred Securities,
[Subordinated] Notes or the appropriate Applicable Ownership Interest of the
Treasury Portfolio underlying such other Stock Purchase Units Certificate.

     In the case of any Stock Purchase Units with respect to which Cash
Settlement of the underlying Purchase Contract is properly effected pursuant to
Section 5.02 hereof, or with respect to which Early Settlement of the underlying
Purchase Contract is properly effected pursuant tot Section 5.07 hereof, or with
respect to which a Collateral Substitution is effected, in each case on a date
that is after any Record Date and prior to or on the next succeeding Payment
Date, distributions on the Preferred Securities, [Subordinated] Notes or on the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, underlying such Stock Purchase Unit otherwise payable on such Payment
Date shall be payable on such Payment Date notwithstanding such Cash Settlement
or Early Settlement or Collateral Substitution, and such distributions shall,
subject to receipt thereof by the Purchase Contract Agent, be payable to the
Person in whose name the Stock Purchase Units Certificate (or one or more
Predecessor Stock Purchase Units Certificates) was registered at the close of
business on the Record Date. Except as otherwise expressly provided in the
immediately preceding sentence, in the case of any Stock Purchase Unit with
respect to which Cash Settlement or Early Settlement of the underlying Purchase
Contract is properly effected, or with respect to which a Collateral
Substitution has been effected, distributions on the related Preferred
Securities, [Subordinated] Notes or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, that would otherwise be
payable after the Purchase Contract Settlement Date, Early Settlement Date

                                       31


or the date of the Collateral Substitution, as the case may be, shall not be
payable hereunder to the Holder of such Stock Purchase Units; PROVIDED, HOWEVER,
that to the extent that such Holder continues to hold separated Preferred
Securities or [Subordinated] Notes that formerly comprised a part of such
Holder's Stock Purchase Unit, such Holder shall be entitled to receive
distributions on such separated Preferred Securities or [Subordinated] Notes.

     Not later than 15 calendar days nor more than 30 calendar days prior to the
Remarketing Date, the Company shall request the Depositary to notify the
Beneficial Owners or Depositary Participants holding Securities of the
procedures to be followed by Holders of Securities who intend to effect a Cash
Settlement.

     SECTION 4.02. NOTICE AND VOTING.

     Under the terms of the Pledge Agreement, the Purchase Contract Agent will
be entitled to exercise the voting and any other consensual rights pertaining to
the Pledged Preferred Securities or Pledged [Subordinated] Notes, but only to
the extent instructed in writing by the Holders as described below. Upon receipt
of notice of any meeting at which holders of Preferred Securities or
[Subordinated] Notes are entitled to vote or upon any solicitation of consents,
waivers or proxies of holders of Preferred Securities or [Subordinated] Notes,
the Purchase Contract Agent shall, as soon as practicable thereafter, mail,
first class, postage pre-paid, to the Holders of Stock Purchase Units a notice:

            (i)  containing such information as is contained in the notice or
     solicitation;

           (ii)  stating that each Holder on the record date set by the Purchase
     Contract Agent therefor (which, to the extent possible, shall be the same
     date as the record date for determining the holders of Preferred Securities
     or [Subordinated] Notes, as the case may be, entitled to vote) shall be
     entitled to instruct the Purchase Contract Agent as to the exercise of the
     voting rights pertaining to such Preferred Securities or [Subordinated]
     Notes underlying their Stock Purchase Units; and

          (iii)  stating the manner in which such instructions may be given.

Upon the written request of the Holders of Stock Purchase Units on such record
date received by the Purchase Contract Agent at least six days prior to such
meeting, the Purchase Contract Agent shall endeavor insofar as practicable to
vote or cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of Preferred Securities or [Subordinated] Notes, as
the case may be, as to which any particular voting instructions are received. In
the absence of specific instructions from the Holder of a Stock Purchase Unit,
the Purchase Contract Agent shall abstain from voting the Preferred Securities
or [Subordinated] Notes underlying such Stock Purchase Unit. The Company hereby
agrees, if applicable, to solicit Holders of Stock Purchase Units to timely
instruct the Purchase Contract Agent in order to enable the Purchase Contract
Agent to vote such Preferred Securities or [Subordinated] Notes

                                       32


and the Trust shall covenant to this effect in the Declaration.

     SECTION 4.03. DISTRIBUTION OF [SUBORDINATED] NOTES; TAX EVENT REDEMPTION.

     Upon the dissolution and liquidation of the Trust in accordance with the
Declaration, an aggregate principal amount at maturity of [Subordinated] Notes
constituting the assets of the Trust and underlying the Preferred Securities
equal to the aggregate liquidation amount of the Pledged Preferred Securities
shall be delivered to the Securities Intermediary in exchange for the Pledged
Preferred Securities. Thereafter, the [Subordinated] Notes will be substituted
for the Pledged Preferred Securities as the Collateral, and will be held by the
Securities Intermediary in the Collateral Account in accordance with the terms
of the Pledge Agreement to secure the obligations of each Holder of a Stock
Purchase Unit to purchase the Common Stock of the Company under the Purchase
Contracts constituting a part of such Stock Purchase Unit.

     Notwithstanding the foregoing, in the event of a dissolution and
liquidation of the Trust, if a Liquidation Distribution is to be distributed in
lieu of the [Subordinated] Notes as provided for in the Declaration, an amount
equal to the Liquidation Distribution shall be deposited in the Collateral
Account in exchange for the Pledged Preferred Securities. Thereafter, pursuant
to the terms of the Pledge Agreement, the Collateral Agent shall cause the
Securities Intermediary to apply an amount equal to the Redemption Amount of
such Liquidation Distribution to purchase on behalf of the Holders of Stock
Purchase Units the Treasury Portfolio and promptly remit the remaining portion
of such Liquidation Distribution to the Purchase Contract Agent for payment to
the Holders of such Stock Purchase Units. The Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio will be substituted as Collateral for the Pledged Preferred Securities
and will be held by the Collateral Agent in accordance with the terms of the
Pledge Agreement to secure the obligation of each Holder of a Stock Purchase
Unit to purchase the Common Stock of the Company under the Purchase Contract
constituting a part of such Stock Purchase Unit.

     Following the dissolution and liquidation of the Trust, the Holders and the
Collateral Agent shall have such security interests, rights and obligations with
respect to the [Subordinated] Notes or the Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio, as the case may be, as the Holders and the Collateral Agent had in
respect of the Preferred Securities subject to the Pledge thereof as provided in
the Pledge Agreement. The Company may cause to be made in any Stock Purchase
Unit Certificates thereafter to be issued such change in phraseology and form
(but not in substance) as may be appropriate to reflect the dissolution and
liquidation of the Trust and the substitution of [Subordinated] Notes or the
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio, as the case may be, for Preferred
Securities as Collateral.

     Upon the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, an amount equal to the Redemption Amount, plus any
accumulated and unpaid

                                       33


distributions or accrued and unpaid interest, as the case may be, payable on the
Tax Event Redemption Date with respect to the Applicable Principal Amount shall
be deposited in the Collateral Account in exchange for the Pledged Preferred
Securities or the Pledged [Subordinated] Notes, as the case may be. Thereafter,
pursuant to the terms of the Pledge Agreement, the Collateral Agent shall cause
the Securities Intermediary to apply an amount equal to the Redemption Amount of
such funds to purchase on behalf of the Holders of Stock Purchase Units the
Treasury Portfolio and promptly remit the remaining portion of such funds to the
Purchase Contract Agent for payment to the Holders of such Stock Purchase Units.
The Applicable Ownership Interest (as specified in clause (A) of the definition
of such term) of the Treasury Portfolio will be substituted as Collateral for
the Pledged Preferred Securities or the Pledged [Subordinated] Notes, as the
case may be, and will be held by the Collateral Agent in accordance with the
terms of the Pledge Agreement to secure the obligation of each Holder of a Stock
Purchase Unit to purchase the Common Stock of the Company under the Purchase
Contract constituting a part of such Stock Purchase Unit. Following the
occurrence of a Tax Event Redemption prior to the Purchase Contract Settlement
Date, the Holders of Stock Purchase Units and the Collateral Agent shall have
such security interest rights and obligations with respect to the Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio as the Holders of Stock Purchase Units and the
Collateral Agent had in respect of the Preferred Securities or [Subordinated]
Notes, as the case may be, subject to the Pledge thereof as provided in the
Pledge Agreement, and any reference herein to the Preferred Securities or the
[Subordinated] Notes shall be deemed to be reference to such Treasury Portfolio.
The Company may cause to be made in any Stock Purchase Unit Certificates
thereafter to be issued such change in phraseology and form (but not in
substance) as may be appropriate to reflect the liquidation of the Trust and the
substitution of the Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio for Preferred Securities
or [Subordinated] Notes as Collateral.

                                    ARTICLE 5
                             THE PURCHASE CONTRACTS

     SECTION 5.01. PURCHASE OF SHARES OF COMMON STOCK.

     Each Purchase Contract shall obligate the Holder of the related Security to
purchase, and the Company to sell, on the Purchase Contract Settlement Date at a
price equal to the Stated Amount (the "PURCHASE PRICE"), a number of shares of
Common Stock (subject to Section 5.09) equal to the Settlement Rate unless an
Early Settlement has occurred in accordance with Section 5.07 hereof or, prior
to or on the Purchase Contract Settlement Date, there shall have occurred a
Termination Event with respect to the Security of which such Purchase Contract
is a part. The "SETTLEMENT RATE" is equal to:

                                       34


            (i)  if the Applicable Market Value (as defined below) is greater
     than or equal to $______ (the "THRESHOLD APPRECIATION PRICE"), _______
     share of Common Stock per Purchase Contract;

           (ii)  if the Applicable Market Value is less than the Threshold
     Appreciation Price but greater than $_______ (the "REFERENCE PRICE"), the
     number of shares of Common Stock per Purchase Contract having a value,
     based on the Applicable Market Value, equal to the Stated Amount; and

          (iii)  if the Applicable Market Value is less than or equal to the
     Reference Price, _______ share of Common Stock per Purchase Contract,

in each case subject to adjustment as provided in Section 5.04 (and in each case
rounded upward or downward to the nearest 1/10,000th of a share).

     The "APPLICABLE MARKET VALUE" means the average of the Closing Price per
share of Common Stock on each of the 20 consecutive Trading Days ending on the
third Trading Day immediately preceding the Purchase Contract Settlement Date.

     The "CLOSING PRICE" per share of Common Stock on any date of determination
means:

            (i)  the closing sale price as of the 4:15 p.m. close of the
     principal trading session (or, if no closing price is reported, the last
     reported sale price) per share on the New York Stock Exchange, Inc. (the
     "NYSE") on such date;

           (ii)  if the Common Stock is not listed for trading on the NYSE on
     any such date, the closing sale price per share as reported in the
     composite transactions for the principal United States securities exchange
     on which the Common Stock is so listed;

          (iii)  if the Common Stock is not so listed on a United States
     national or regional securities exchange, the closing sale price per share
     as reported by The Nasdaq National Market;

           (iv)  if the Common Stock is not so reported, the last quoted bid
     price for the Common Stock in the over-the-counter market as reported by
     the National Quotation Bureau or similar organization; or

            (v)  if such bid price is not available, the average of the
     mid-point of the last bid and ask prices of the Common Stock on such date
     from at least three nationally recognized independent investment banking
     firms retained for this purpose by the Company.

                                       35


     A "TRADING DAY" means a day on which the Common Stock (1) is not suspended
from trading on any national or regional securities exchange or association or
over-the-counter market at the close of business and (2) has traded at least
once on the national or regional securities exchange or association or
over-the-counter market that is the primary market for the trading of the Common
Stock.

     Each Holder of a Stock Purchase Unit or a Treasury Stock Purchase Unit, by
its acceptance thereof:

            (i)  irrevocably authorizes the Purchase Contract Agent to enter
     into and perform the related Purchase Contract on its behalf as its
     attorney-in- fact (including the execution of Certificates on behalf of
     such Holder);

           (ii)  agrees to be bound by the terms and provisions thereof;

          (iii)  covenants and agrees to perform its obligations under such
     Purchase Contracts;

           (iv)  consents to the provisions hereof;

            (v)  irrevocably authorizes the Purchase Contract Agent to enter
     into and perform this Agreement and the Pledge Agreement on its behalf as
     its attorney-in-fact; and

           (vi)  consents to, and agrees to be bound by, the Pledge of such
     Holder's right, title and interest in and to the Collateral Account,
     including the Preferred Securities, [Subordinated] Notes, the Applicable
     Ownership Interest (as specified in clause (A) of the definition of such
     term) of the Treasury Portfolio or the Treasury Securities pursuant to the
     Pledge Agreement,

PROVIDED that upon a Termination Event, the rights of the Holder of such
Security under the Purchase Contract may be enforced without regard to any other
rights or obligations. Each Holder of a Stock Purchase Unit or a Treasury Stock
Purchase Unit, by its acceptance thereof, further covenants and agrees, that to
the extent and in the manner provided in Section 5.02 and the Pledge Agreement,
but subject to the terms thereof, payments in respect of the Preferred
Securities or the [Subordinated] Notes or the proceeds from the Treasury
Securities or the Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio at maturity on the
Purchase Contract Settlement Date, as the case may be, shall be paid by the
Collateral Agent to the Company in satisfaction of such Holder's obligations
under such Purchase Contract and such Holder shall acquire no right, title or
interest in such payments.

                                       36


     Upon registration of transfer of a Certificate, the transferee shall be
bound (without the necessity of any other action on the part of such transferee)
by the terms of this Agreement, the Purchase Contracts underlying such
Certificate, the Declaration and the Pledge Agreement and the transferor shall
be released from the obligations under this Agreement, the Purchase Contracts
underlying the Certificate so transferred and the Pledge Agreement. The Company
covenants and agrees, and each Holder of a Certificate, by its acceptance
thereof, likewise covenants and agrees, to be bound by the provisions of this
paragraph.

     SECTION 5.02. PAYMENT OF PURCHASE PRICE.

     (a)    (i)  Unless a Tax Event Redemption has occurred or a Holder of a
Stock Purchase Unit effects an Early Settlement of the underlying Purchase
Contract in the manner described in Section 5.07, each Holder who intends to pay
in cash to satisfy such Holder's obligations under the Purchase Contract on the
Purchase Contract Settlement Date shall notify the Purchase Contract Agent by
use of a notice in substantially the form of Exhibit E hereto of his intention
to pay in cash ("CASH SETTLEMENT") the Purchase Price for the shares of Common
Stock to be purchased pursuant to the related Purchase Contract. Such notice
shall be given prior to 5:00 p.m. (New York City time) on the seventh Business
Day immediately preceding the Purchase Contract Settlement Date. Prior to 11:00
a.m. (New York City time) on the next succeeding Business Day, the Purchase
Contract Agent shall notify the Collateral Agent and the Property Trustee or the
Indenture Trustee, as the case may be, of the receipt of such notices from
Holders intending to make a Cash Settlement.

           (ii)  A Holder of a Stock Purchase Unit who has so notified the
     Purchase Contract Agent of his intention to effect a Cash Settlement in
     accordance with paragraph 5.02(a)(i) above shall pay the Purchase Price to
     the Securities Intermediary for deposit in the Collateral Account prior to
     11:00 a.m. (New York City time) on the fifth Business Day immediately
     preceding the Purchase Contract Settlement Date, in lawful money of the
     United States by certified or cashiers' check or wire transfer, in each
     case in immediately available funds payable to or upon the order of the
     Securities Intermediary. Any cash received by the Collateral Agent shall be
     invested promptly by the Securities Intermediary in Permitted Investments
     and paid to the Company on the Purchase Contract Settlement Date in
     settlement of the Purchase Contracts in accordance with the terms of this
     Agreement and the Pledge Agreement. Any funds received by the Securities
     Intermediary in respect of the investment earnings from such Permitted
     Investments in excess of the Purchase Price for the shares of Common Stock
     to be purchased by such Holder shall be distributed to the Purchase
     Contract Agent when received for payment to the Holder.

          (iii)  If a Holder of a Stock Purchase Unit fails to notify the
     Purchase Contract Agent of his intention to make a Cash Settlement in
     accordance with paragraph 5.02(a)(i) above, or does notify the Purchase
     Contract Agent as provided in paragraph 5.02(a)(i) above of his intention
     to pay the Purchase Price in cash, but fails to make such payment

                                       37


     as required by paragraph 5.02(a)(ii) above, such Holder shall be deemed to
     have consented to the disposition of the Pledged Preferred Securities or
     the Pledged [Subordinated] Notes pursuant to the Remarketing as described
     in paragraph 5.02(b) below.

           (iv)  Promptly after 11:00 a.m. (New York City time) on the fifth
     Business Day preceding the Purchase Contract Settlement Date, the Purchase
     Contract Agent, based on notices received by the Purchase Contract Agent
     pursuant to Section 5.02(a) hereof and notice from the Securities
     Intermediary regarding cash received by it prior to such time, shall notify
     the Collateral Agent and the Property Trustee or the Indenture Trustee, as
     applicable of the aggregate number of Preferred Securities or
     [Subordinated] Notes to be tendered for purchase in the Remarketing in a
     notice substantially in the form of Exhibit F hereto.

     (b) In order to dispose of the Preferred Securities or [Subordinated]
Notes, Stock Purchase Units Holders who have not notified the Purchase Contract
Agent of their intention to effect a Cash Settlement as provided in paragraph
5.02(a)(i) above, or who have so notified the Purchase Contract Agent but failed
to make such payment as required by paragraph 5.02(a)(ii) above, the Company
shall engage _____________________, as Remarketing Agent (the "REMARKETING
AGENT"), pursuant to the Remarketing Agreement (and subject to removal as
provided in the Remarketing Agreement) to sell such Preferred Securities or
[Subordinated] Notes. In order to facilitate the Remarketing, the Purchase
Contract Agent, based on the notices specified in Section 5.02(a)(iv), shall
notify the Remarketing Agent, promptly after 11:00 a.m. (New York City time) on
the fifth Business Day immediately preceding the Purchase Contract Settlement
Date, of the aggregate number of Preferred Securities or [Subordinated] Notes
that are part of Stock Purchase Units to be remarketed. Concurrently, the
Collateral Agent, pursuant to the terms of the Pledge Agreement, shall cause
such Preferred Securities or [Subordinated] Notes to be presented to the
Remarketing Agent for Remarketing.

     Upon receipt of such notice from the Purchase Contract Agent and such
Preferred Securities or [Subordinated] Notes, the Remarketing Agent shall, on
the third Business Day immediately preceding the Purchase Contract Settlement
Date, use reasonable efforts to remarket such Preferred Securities or
[Subordinated] Notes on such date at a price equal to [     ]% of the Stated
Amount ($[        ]) per Preferred Security or [Subordinated] Note, as provided
in the Remarketing Agreement. The proceeds from the Remarketing shall be
invested by the Collateral Agent in Permitted Investments, in accordance with
the Pledge Agreement, and then applied to satisfy in full such Stock Purchase
Units Holders' obligations to pay the Purchase Price for the shares of Common
Stock under the related Purchase Contracts on the Purchase Contract Settlement
Date. In addition, [$        ] per Preferred Security or [Subordinated] Note of
the proceeds shall automatically be remitted to the Remarketing Agent for
services rendered in connection with the Remarketing (the "REMARKETING FEE").

                                       38


     If, in spite of using its reasonable efforts, the Remarketing Agent cannot
remarket the related Preferred Securities or [Subordinated] Notes of such
Holders of Stock Purchase Units at a price equal to [        ]% of the Stated
Amount ($[       ]), then the Remarketing Agent shall increase the distribution
rate on the Preferred Securities or the interest rate on the [Subordinated]
Notes, as the case may be, so that the market value of such Preferred Securities
will equal ($[         ]). If the Remarketing Agent determines that it will be
able to remarket the related Preferred Securities or [Subordinated] Notes of
such Holders of Stock Purchase Units at a price in excess of [         ]% of the
Stated Amount ($[        ]), then the Remarketing Agent shall decrease the
distribution rate on the Preferred Securities or the interest rate on the
[Subordinated] Notes, as the case may be, so that the market value of such
Preferred Securities or [Subordinated] Notes will be equal to [$ ]. If the
Remarketing Agent cannot Remarket the Preferred Securities or the [Subordinated]
Notes, as the case may be, after such increase or decrease, the Remarketing
shall be deemed to have failed (a "FAILED REMARKETING"), an event of default
shall be deemed to have occurred under this Agreement and the Pledge Agreement
and in accordance with the terms of the Pledge Agreement, the Collateral Agent,
for the benefit of the Company, shall exercise its rights as a secured party
with respect to such Preferred Securities or [Subordinated] Notes, including
those actions specified in paragraph 5.02(c) below; PROVIDED, that if upon a
Failed Remarketing the Collateral Agent exercises such rights for the benefit of
the Company with respect to such Preferred Securities or [Subordinated] Notes,
any accrued and unpaid distributions on such Preferred Securities or
[Subordinated] Notes and any accrued and unpaid Purchase Contract Payments
(including any deferred Purchase Contract Payments) shall become payable by the
Company to the Purchase Contract Agent for payment to the Beneficial Owner of
the Stock Purchase Units to which such Preferred Securities or [Subordinated]
Notes relate. The Company shall cause a notice of such Failed Remarketing to be
published on the second Business Day immediately preceding the Purchase Contract
Settlement Date in a daily newspaper in the English language of general
circulation in the City of New York, which is expected to be The Wall Street
Journal, and on Bloomberg News.

     (c) With respect to any Preferred Securities or [Subordinated] Notes which
are subject to a Failed Remarketing, the Collateral Agent for the benefit of the
Company reserves all of its rights as a secured party with respect thereto and,
subject to applicable law and paragraph 5.02(g) below, shall, in full
satisfaction of the Holders' obligations under the Purchase Contracts among
other things, (i) retain the Preferred Securities or [Subordinated] Notes, (ii)
sell the Preferred Securities or [Subordinated] Notes in one or more public or
private sales or (iii) take, or choose not to take, any other action with
respect to the Preferred Securities or the [Subordinated] Notes, which in every
case specified in (i), (ii) and (iii) shall constitute payment in full for the
aggregate Purchase Price for the shares of Common Stock to be purchased under
the Purchase Contracts.

     (d) (i) Unless a Holder of a Treasury Stock Purchase Unit or Stock
Purchase Unit (if a Tax Event Redemption has occurred) effects an Early
Settlement of the underlying Purchase Contract through the early delivery of
cash to the Purchase Contract Agent in the manner described in Section 5.07,
each Holder of a Treasury Stock Purchase Unit or Stock Purchase Unit (if a Tax
Event Redemption has occurred) who intends to pay in cash shall notify the
Purchase

                                       39


Contract Agent by use of a notice in substantially the form of Exhibit E hereto
of his intention to pay in cash the Purchase Price for the shares of Common
Stock to be purchased pursuant to the related Purchase Contract. Such notice
shall be given prior to 5:00 p.m. (New York City time) on the second Business
Day immediately preceding the Purchase Contract Settlement Date. Prior to 11:00
a.m. (New York City time) on the next succeeding Business Day, the Purchase
Contract Agent shall notify the Collateral Agent of the receipt of such notices
from such Holders intending to make a Cash Settlement. Treasury Stock Purchase
Unit holders may make Cash Settlements only in integral multiples of 40 Treasury
Stock Purchase Units.

           (ii)  A Holder of a Treasury Stock Purchase Unit or Stock Purchase
     Units (if a Tax Event Redemption has occurred) who has so notified the
     Purchase Contract Agent of his intention to make a Cash Settlement in
     accordance with paragraph 5.02(d)(i) above shall pay the Purchase Price to
     the Securities Intermediary for deposit in the Collateral Account prior to
     11:00 a.m. (New York City time) on the Business Day immediately preceding
     the Purchase Contract Settlement Date, in lawful money of the United States
     by certified or cashiers' check or wire transfer, in each case in
     immediately available funds payable to or upon the order of the Securities
     Intermediary. Any cash received by the Collateral Agent shall be invested
     promptly by the Securities Intermediary in Permitted Investments and paid
     to the Company on the Purchase Contract Settlement Date in settlement of
     the Purchase Contract in accordance with the terms of this Agreement and
     the Pledge Agreement. Any funds received by the Securities Intermediary in
     respect of the investment earnings from the investment in such Permitted
     Investments in excess of the Purchase Price for the shares of Common Stock
     to be purchased by such Holder shall be distributed to the Purchase
     Contract Agent when received for payment to the Holder.

          (iii)  If a Holder of a Treasury Stock Purchase Unit or Holder of a
     Stock Purchase Unit (if a Tax Event Redemption has occurred) fails to
     notify the Purchase Contract Agent of his intention to make a Cash
     Settlement in accordance with paragraph 5.02(d)(i) above, or does notify
     the Purchase Contract Agent as provided in paragraph 5.02(d)(i) above of
     his intention to pay the Purchase Price in cash, but fails to make such
     payment as required by paragraph 5.02(d)(ii) above, then upon the maturity
     of the Pledged Treasury Securities or the appropriate Applicable Ownership
     Interest (as specified in clause (A) of the definition of such term) of the
     Treasury Portfolio held by the Securities Intermediary on the Business Day
     immediately preceding the Purchase Contract Settlement Date, the principal
     amount of the Treasury Securities or the appropriate Applicable Ownership
     Interest (as specified in clause (A) of the definition of such term) of the
     Treasury Portfolio received by the Securities Intermediary shall be
     invested promptly in Permitted Investments. On the Purchase Contract
     Settlement Date, an amount equal to the Purchase Price shall be remitted to
     the Company as payment thereof without receiving any instructions from the
     Holder. In the event the sum of the proceeds from the related Pledged
     Treasury Securities or the appropriate Applicable Ownership Interest (as
     specified in clause (A) of the definition of such term) of the Treasury
     Portfolio and the investment earnings earned from such investments is in
     excess of the

                                       40


     aggregate Purchase Price of the Purchase Contracts being settled thereby,
     the Collateral Agent shall cause the Securities Intermediary to distribute
     such excess to the Purchase Contract Agent for the benefit of the Holder of
     the related Treasury Stock Purchase Unit or Stock Purchase Unit when
     received.

           (iv)  A holder of a Preferred Security or [Subordinated] Note that is
     no longer part of a Stock Purchase Unit may elect to have such Preferred
     Security or [Subordinated] Note, as the case may be, remarketed. A holder
     making such an election must notify the Property Trustee or the Indenture
     Trustee, as the case may be, prior to 11:00 a.m. (New York City time) on
     the fifth Business Day immediately preceding the Purchase Contract
     Settlement Date, of the aggregate number of Preferred Securities or
     [Subordinated] Notes, as the case may be, that are not part of Stock
     Purchase Units to be remarketed. Any such notice will be irrevocable and
     may not be conditioned upon the level at which the Reset Rate is
     established in the Remarketing. Concurrently, the Property Trustee or the
     Indenture Trustee, as the case may be, shall cause such Preferred
     Securities or [Subordinated] Notes, as the case may be, to be presented to
     the Remarketing Agent for Remarketing.

     (e) Any distribution to Holders of any payments described above shall be
payable at the office of the Purchase Contract Agent in New York City maintained
for that purpose or, at the option of the Holder, by check mailed to the address
of the Person entitled thereto at such address as it appears on the Security
Register.

     (f) Upon Cash Settlement of any Purchase Contract:

            (i)  the Collateral Agent will in accordance with the terms of
     the Pledge Agreement cause the Pledged Preferred Securities, Pledged
     [Subordinated] Notes, the appropriate Applicable Ownership Interest (as
     specified in clause (A) of the definition of such term) of the Treasury
     Portfolio or the Pledged Treasury Securities, as the case may be,
     underlying the relevant Security to be released from the Pledge, free and
     clear of any security interest of the Company, and transferred to the
     Purchase Contract Agent for delivery to the Holder thereof or its designee
     as soon as practicable; and

           (ii)  subject to the receipt thereof, the Purchase Contract
     Agent shall, by book-entry transfer or other appropriate procedures, in
     accordance with written instructions provided by the Holder thereof,
     transfer such Preferred Securities, [Subordinated] Notes, or the
     appropriate Applicable Ownership Interest (as specified in clause (A) of
     the definition of such term) of the Treasury Portfolio or such Treasury
     Securities, as the case may be (or, if no such instructions are given to
     the Purchase Contract Agent by the Holder, the Purchase Contract Agent
     shall hold such Preferred Securities, [Subordinated] Notes, or the
     appropriate Applicable Ownership Interest (as specified in clause (A) of
     the definition of such term) of the Treasury Portfolio or such Treasury
     Securities, as the case may be, and any interest payment thereon, in the
     name of

                                       41


     the Purchase Contract Agent or its nominee in trust for the benefit of such
     Holder until the expiration of the time period specified in the abandoned
     property laws of the relevant state).

     (g) The obligations of the Holders to pay the Purchase Price are
non-recourse obligations and, except to the extent satisfied by Early Settlement
or Cash Settlement, are payable solely out of the proceeds of any Collateral
pledged to secure the obligations of the Holders and in no event will Holders be
liable for any deficiency between the proceeds of the disposition of Collateral
and the Purchase Price.

     (h) The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates thereof to the
Holder of the related Security unless the Company shall have received payment in
full for the aggregate Purchase Price for the Common Stock to be purchased
thereunder in the manner herein set forth.

     SECTION 5.03. ISSUANCE OF SHARES OF COMMON STOCK.

     Unless a Termination Event or an Early Settlement shall have occurred,
subject to Section 5.04(b), on the Purchase Contract Settlement Date upon
receipt of the aggregate Purchase Price payable on all Outstanding Securities,
the Company shall issue and deposit with the Purchase Contract Agent, for the
benefit of the Holders of the Outstanding Securities, one or more certificates
representing newly issued shares of Common Stock registered in the name of the
Purchase Contract Agent (or its nominee) as custodian for the Holders (such
certificates for shares of Common Stock, together with any dividends or
distributions for which a record date and payment date for such dividend or
distribution has occurred after the Purchase Contract Settlement Date, being
hereinafter referred to as the "PURCHASE CONTRACT SETTLEMENT FUND") to which the
Holders are entitled hereunder.

     Subject to the foregoing, upon surrender of a Certificate to the Purchase
Contract Agent on or after the Purchase Contract Settlement Date or Early
Settlement Date, as the case may be, together with settlement instructions
thereon duly completed and executed, the Holder of such Certificate shall be
entitled to receive forthwith in exchange therefor a certificate representing
that number of newly issued whole shares of Common Stock which such Holder is
entitled to receive pursuant to the provisions of this Article Five (after
taking into account all Securities then held by such Holder), together with cash
in lieu of fractional shares as provided in Section 5.09 and any dividends or
distributions with respect to such shares constituting part of the Purchase
Contract Settlement Fund, but without any interest thereon, and the Certificate
so surrendered shall forthwith be cancelled. Such shares shall be registered in
the name of the Holder or the Holder's designee as specified in the settlement
instructions provided by the Holder to the Purchase Contract Agent. If any
shares of Common Stock issued in respect of a Purchase Contract are to be
registered to a Person other than the Person in whose name the Certificate
evidencing such Purchase Contract is registered, no such registration shall be
made unless the Person requesting such registration has paid any transfer and
other taxes required by

                                       42


reason of such registration in a name other than that of the registered Holder
of the Certificate evidencing such Purchase Contract or has established to the
satisfaction of the Company that such tax either has been paid or is not
payable.

     SECTION 5.04. ADJUSTMENT OF SETTLEMENT RATE.

     (a) Adjustments for Dividends, Distributions, Stock Splits, Etc.

     (1) In case the Company shall pay or make a dividend or other distribution
on Common Stock in Common Stock, the Settlement Rate in effect at the opening of
business on the day following the date fixed for the determination of
shareholders entitled to receive such dividend or other distribution shall be
increased by dividing such Settlement Rate by a fraction of which:

            (i)  the numerator shall be the number of shares of Common
     Stock outstanding at the close of business on the date fixed for such
     determination; and

           (ii)  the denominator shall be the sum of such number of shares
     and the total number of shares constituting such dividend or other
     distribution,

such increase to become effective immediately after the opening of business on
the day following the date fixed for such determination. For the purposes of
this paragraph (1), the number of shares of Common Stock at any time outstanding
shall not include shares held in the treasury of the Company but shall include
any shares issuable in respect of any scrip certificates issued in lieu of
fractions of shares of Common Stock. The Company shall not pay any dividend or
make any distribution on shares of Common Stock held in the treasury of the
Company.

     (2) In case the Company shall issue rights, warrants or options to all
holders of its Common Stock (not being available on an equivalent basis to
Holders of the Securities upon settlement of the Purchase Contracts underlying
such Securities) entitling them, for a period expiring within 45 days after the
record date for the determination of shareholders entitled to receive such
rights, warrants or options, to subscribe for or purchase shares of Common Stock
at a price per share less than the Current Market Price per share of Common
Stock on the date fixed for the determination of shareholders entitled to
receive such rights, warrants or options, the Settlement Rate in effect at the
opening of business on the day following the date fixed for such determination
shall be increased by dividing such Settlement Rate by a fraction of which:

            (i)  the numerator shall be the number of shares of Common
     Stock outstanding at the close of business on the date fixed for such
     determination plus the number of shares of Common Stock which the aggregate
     of the offering price of the total number of shares of Common Stock so
     offered for subscription or purchase would purchase at such Current Market
     Price; and

                                       43


           (ii)  the denominator shall be the number of shares of Common
     Stock outstanding at the close of business on the date fixed for such
     determination plus the number of shares of Common Stock so offered for
     subscription or purchase,

such increase to become effective immediately after the opening of business on
the day following the date fixed for such determination. For the purposes of
this paragraph (2), the number of shares of Common Stock at any time outstanding
shall not include shares held in the treasury of the Company but shall include
any shares issuable in respect of any scrip certificates issued in lieu of
fractions of shares of Common Stock. The Company agrees that it shall not issue
any such rights, warrants or options in respect of shares of Common Stock held
in the treasury of the Company.

     (3) In case outstanding shares of Common Stock shall be subdivided or
split into a greater number of shares of Common Stock, the Settlement Rate in
effect at the opening of business on the day following the day upon which such
subdivision or split becomes effective shall be proportionately increased, and,
conversely, in case outstanding shares of Common Stock shall each be combined
into a smaller number of shares of Common Stock, the Settlement Rate in effect
at the opening of business on the day following the day upon which such
combination becomes effective shall be proportionately reduced, such increase or
reduction, as the case may be, to become effective immediately after the opening
of business on the day following the day upon which such subdivision, split or
combination becomes effective.

     (4) In case the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock evidences of its indebtedness or assets (including
securities, but excluding any rights, warrants or options referred to in
paragraph (2) of this Section 5.04(a), any dividend or distribution paid
exclusively in cash and any dividend or distribution referred to in paragraph
(1) of this Section 5.04(a)), the Settlement Rate shall be adjusted so that the
same shall equal the rate determined by dividing the Settlement Rate in effect
immediately prior to the close of business on the date fixed for the
determination of shareholders entitled to receive such distribution by a
fraction of which:

            (i)  the numerator shall be the Current Market Price per share of
     Common Stock on the date fixed for such determination less the then fair
     market value (as reasonably determined by the Board of Directors, whose
     determination shall be conclusive and the basis for which shall be
     described in a Board Resolution) of the portion of the assets or evidences
     of indebtedness so distributed applicable to one share of Common Stock; and

           (ii)  the denominator shall be such Current Market Price per share of
     Common Stock,

such adjustment to become effective immediately prior to the opening of business
on the day following the date fixed for the determination of shareholders
entitled to receive such distribution. In any case in which this paragraph (4)
is applicable, paragraph (2) of this Section 5.04(a)

                                       44


shall not be applicable. In the event that such dividend or distribution is not
so paid or made, the Settlement Rate shall again be adjusted to be the
Settlement Rate which would then be in effect if such dividend or distribution
had not been declared.

     (5) In case the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock cash (excluding:

            (i)  any quarterly cash dividend on Common Stock to the extent that
     the aggregate cash dividend per share of Common Stock in any fiscal quarter
     does not exceed $____ per share (as adjusted from time to time to reflect
     the subdivisions or combinations of Common Stock, the "DIVIDEND
     THRESHOLD"), and

           (ii)  any dividend or distribution in connection with the
     liquidation, dissolution or termination of the Company, whether voluntary
     or involuntary),

then, in such case, the Settlement Rate shall be increased so that the same
shall equal the rate determined by dividing the Settlement Rate in effect
immediately prior to the close of business on such record date by a fraction of
which:

            (i)  the numerator shall be the Current Market Price of Common Stock
     on the record date less the amount of cash so distributed (and not excluded
     as provided above) applicable to one share of Common Stock; and

           (ii)  the denominator shall be the Current Market Price of Common
     Stock,

such increase to be effective immediately prior to the opening of business on
the day following the record date; PROVIDED, HOWEVER, that in the event the
portion of cash so distributed applicable to one share of Common Stock is equal
to or greater than the Current Market Price per share of Common Stock on the
record date, in lieu of the foregoing adjustment, adequate provision shall be
made so that each holder of a Security shall have the right to receive upon
settlement of the Securities the amount of cash such Holder would have received
had such Holder settled each Security on the record date. In the event that such
dividend or distribution is not so paid or made, the Settlement Rate shall again
be adjusted to be the Settlement Rate which would then be in effect if such
dividend or distribution had not been declared. If any adjustment is required to
be made as set forth in this Section 5.04(a)(5) as a result of a distribution
that is a quarterly dividend, such adjustment shall be based upon the amount by
which such distribution exceeds the amount of the Dividend Threshold. If an
adjustment is required to be made as set forth in this Section 5.04(a)(5) above
as a result of a distribution that is not a quarterly dividend, such adjustment
shall be based upon the full amount of the distribution.

     (6) In case a tender or exchange offer made by the Company or any
subsidiary of the Company for all or any portion of Common Stock shall expire
and such tender or exchange offer (as amended upon the expiration thereof) shall
require the payment to shareholders (based on the

                                       45


acceptance (up to any maximum specified in the terms of the tender or exchange
offer) of Purchased Shares as herein defined) of (I) an aggregate consideration
having a fair market value (as reasonably determined by the Board of Directors,
whose determination shall be conclusive and the basis for which shall be
described in a Board Resolution) that combined together with the aggregate of
the cash plus the fair market value (as reasonably determined by the Board of
Directors, whose determination shall be conclusive and the basis for which shall
be described in a Board Resolution), as of the expiration of such tender or
exchange offer, of consideration payable in respect of any other tender or
exchange offer, by the Company or any subsidiary of the Company for all or any
portion of Common Stock expiring within the 12 months preceding the expiration
of such tender or exchange offer and in respect of which no adjustment pursuant
to this paragraph (6) has been made, and (II) the aggregate amount of any
distributions to all holders of Common Stock made exclusively in cash within the
12 months preceding the expiration of such tender or exchange offer and in
respect of which no adjustment pursuant to paragraph (6) has been made, exceeds
15% of the product of the Current Market Price per share of Common Stock as of
the last time (the "EXPIRATION TIME") tenders could have been made pursuant to
such tender or exchange offer (as it may be amended) times the number of shares
of Common Stock outstanding (including any tendered shares) on the Expiration
Time, then, and in each such case, immediately prior to the opening of business
on the day after the date of the Expiration Time, the Settlement Rate shall be
adjusted so that the same shall equal the rate determined by dividing the
Settlement Rate immediately prior to the close of business on the date of the
Expiration Time by a fraction:

            (i)  the numerator of which shall be equal to (A) the product of (I)
     the Current Market Price per share of Common Stock on the date of the
     Expiration Time and (II) the number of shares of Common Stock outstanding
     (including any tendered shares) on the Expiration Time less (B) the amount
     of cash plus the fair market value (determined as aforesaid) of the
     aggregate consideration payable to shareholders based on the transactions
     described in clauses (I) and (II) above (assuming in the case of clause (I)
     the acceptance, up to any maximum specified in the terms of the tender or
     exchange offer, of Purchased Shares); and

           (ii)  the denominator of which shall be equal to the product of (A)
     the Current Market Price per share of Common Stock as of the Expiration
     Time and (B) the number of shares of Common Stock outstanding (including
     any tendered shares) as of the Expiration Time less the number of all
     shares validly tendered and not withdrawn as of the Expiration Time (the
     shares deemed so accepted, up to any such maximum, being referred to as the
     "PURCHASED SHARES").

     (7) The reclassification of Common Stock into securities including
securities other than Common Stock (other than any reclassification upon a
Reorganization Event to which Section 5.04(b) applies) shall be deemed to
involve:

                                       46


            (i)  a distribution of such securities other than Common Stock to
     all holders of Common Stock (and the effective date of such
     reclassification shall be deemed to be "the date fixed for the
     determination of shareholders entitled to receive such distribution" and
     the "date fixed for such determination" within the meaning of paragraph (4)
     of this Section); and

           (ii)  a subdivision, split or combination, as the case may be, of the
     number of shares of Common Stock outstanding immediately prior to such
     reclassification into the number of shares of Common Stock outstanding
     immediately thereafter (and the effective date of such reclassification
     shall be deemed to be "the day upon which such subdivision or split becomes
     effective" or "the day upon which such combination becomes effective", as
     the case may be, and "the day upon which such subdivision, split or
     combination becomes effective" within the meaning of paragraph (3) of this
     Section).

     (8) The "CURRENT MARKET PRICE" per share of Common Stock on any date of
determination means the average of the daily Closing Prices for the five
consecutive Trading Days selected by the Company commencing not more than 30
Trading Days before, and ending not later than, the earlier of such date of
determination and the day before the "ex date" with respect to the issuance or
distribution requiring such computation. For purposes of this paragraph, the
term "ex date," when used with respect to any issuance or distribution, shall
mean the first date on which Common Stock trades on such exchange or in such
market without the right to receive such issuance or distribution.

     (9) All adjustments to the Settlement Rate shall be calculated to the
nearest 1/10,000th of a share of Common Stock (or if there is not a nearest
1/10,000th of a share, to the next lower 1/10,000th of a share). No adjustment
in the Settlement Rate shall be required unless such adjustment would require an
increase or decrease of at least one percent thereof; PROVIDED, HOWEVER, that
any adjustments which by reason of this subparagraph are not required to be made
shall be carried forward and taken into account in any subsequent adjustment. If
an adjustment is made to the Settlement Rate pursuant to paragraph (1), (2),
(3), (4), (5), (6), (7) or (10) of this Section 5.04(a), an adjustment shall
also be made to the Applicable Market Value solely to determine which of clauses
(i), (ii) or (iii) of the definition of Settlement Rate in Section 5.01 will
apply on the Purchase Contract Settlement Date. Such adjustment shall be made by
multiplying the Applicable Market Value by a fraction of which the numerator
shall be the Settlement Rate immediately after such adjustment pursuant to
paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of this Section 5.04(a) and
the denominator shall be the Settlement Rate immediately prior to such
adjustment; PROVIDED, HOWEVER, that if such adjustment to the Settlement Rate is
required to be made pursuant to the occurrence of any of the events contemplated
by paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of this Section 5.04(a)
during the period taken into consideration for determining the Applicable Market
Value, appropriate and customary adjustments shall be made to the Settlement
Rate.

                                       47


     (10) The Company may, but shall not be required to, make such increases in
the Settlement Rate, in addition to those required by this Section, as it
considers to be advisable in order to avoid or diminish any income tax to any
holders of shares of Common Stock resulting from any dividend or distribution of
stock or issuance of rights or warrants to purchase or subscribe for stock or
from any event treated as such for income tax purposes or for any other reason.

     (b) Adjustment for Consolidation, Merger or Other Reorganization Event.

     (1) In the event of:

            (i)  any consolidation or merger of the Company with or into another
     Person (other than a merger or consolidation in which the Company is the
     continuing corporation and in which the shares of Common Stock outstanding
     immediately prior to the merger or consolidation are not exchanged for
     cash, securities or other property of the Company or another corporation);

           (ii)  any sale, transfer, lease or conveyance to another Person of
     the property of the Company as an entirety or substantially as an entirety;

          (iii)  any statutory share exchange of the Company with another Person
     (other than in connection with a merger or acquisition); or

           (iv)  any liquidation, dissolution or termination of the Company
     other than as a result of or after the occurrence of a Termination Event,
     (any such event, a "REORGANIZATION EVENT"),

the Settlement Rate will be adjusted to provide that each Holder of Securities
will receive on the Purchase Contract Settlement Date with respect to each
Purchase Contract forming a part thereof, the kind and amount of securities,
cash and other property receivable upon such Reorganization Event (without any
interest thereon, and without any right to dividends or distribution thereon
which have a record date that is prior to the Purchase Contract Settlement Date)
by a Holder of the number of shares of Common Stock issuable on account of each
Purchase Contract if the Purchase Contract Settlement Date had occurred
immediately prior to such Reorganization Event, assuming such Holder of Common
Stock is not a Person with which the Company consolidated or into which the
Company merged or which merged into the Company or to which such sale or
transfer was made, as the case may be (any such Person, a "CONSTITUENT PERSON"),
or an Affiliate of a Constituent Person to the extent such Reorganization Event
provides for different treatment of Common Stock held by Affiliates of the
Company and non-affiliates and such Holder failed to exercise his rights of
election, if any, as to the kind or amount of securities, cash and other
property receivable upon such Reorganization Event (PROVIDED that if the kind or
amount of securities, cash and other property receivable upon such
Reorganization Event is not the same for each share of Common Stock held
immediately prior to such Reorganization Event

                                       48


by other than a Constituent Person or an Affiliate thereof and in respect of
which such rights of election shall not have been exercised ("NON-ELECTING
SHARE"), then for the purpose of this Section the kind and amount of securities,
cash and other property receivable upon such Reorganization Event by each
non-electing share shall be deemed to be the kind and amount so receivable per
share by a plurality of the non-electing shares).

     In the event of such a Reorganization Event, the Person formed by such
consolidation, merger or exchange or the Person which acquires the assets of the
Company or, in the event of a liquidation, dissolution or termination of the
Company, the Company or a liquidating trust created in connection therewith,
shall execute and deliver to the Purchase Contract Agent an agreement
supplemental hereto providing that each Holder of an Outstanding Security shall
have the rights provided by this Section 5.04(b). Such supplemental agreement
shall provide for adjustments which, for events subsequent to the effective date
of such supplemental agreement, shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Section. The above
provisions of this Section shall similarly apply to successive Reorganization
Events.

     (2) In the event of a consolidation or merger of the Company with or into
another Person, any merger of another Person into the Company (other than a
merger that does not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of Common Stock) in which 30% or more of the
total consideration paid to the Company's shareholders consists of cash or cash
equivalents, then a Holder of a Security may settle his Purchase Contract for
cash as described in Section 5.02(a)(i) or 5.02(d)(i) hereof, as applicable,
during the one week period beginning on the twenty-third Trading Day following
the closing date of such merger (the "EARLY SETTLEMENT WEEK"), at the applicable
Settlement Rate. For the purposes of this Section, the twenty-third Trading Day
after the closing of the merger or consolidation shall be deemed to be the
Purchase Contract Settlement Date for the purpose of determining the Applicable
Market Value and the deadline for submitting the notice to settle early and the
related cash payment shall be 5:00 p.m. (New York City time) of the last
Business Day of the Early Settlement Week. Notwithstanding the foregoing, no
early settlement will be permitted under this Section 5.04(b)(2) unless, at the
time such early settlement is effected, there is an effective Registration
Statement with respect to the shares of Common Stock to be issued and delivered
in connection with such early settlement, if such a Registration Statement is
required (in the view of counsel, which need not be in the form of a written
opinion, for either the Company or the Purchase Contract Agent) under the
Securities Act. If such a Registration Statement is so required, the Company
covenants and agrees to use its best efforts to (A) have in effect a
Registration Statement covering the shares of Common Stock to be delivered in
respect of the Purchase Contracts being settled and (B) provide a Prospectus in
connection therewith, in each case in a form that the Purchase Contract Agent
may use in connection with such early settlement.

     (c) All calculations and determinations pursuant to this Section 5.04
shall be made by the Company or its agent and the Purchase Contract Agent shall
have no responsibility with respect thereto.

                                       49


     SECTION 5.05. NOTICE OF ADJUSTMENTS AND CERTAIN OTHER EVENTS.

     (a) Whenever the Settlement Rate is adjusted as herein provided, the
Company shall:

            (i)  forthwith compute the adjusted Settlement Rate in accordance
     with Section 5.04 and prepare and transmit to the Purchase Contract Agent
     an Officers' Certificate setting forth the Settlement Rate, the method of
     calculation thereof in reasonable detail, and the facts requiring such
     adjustment and upon which such adjustment is based; and

           (ii)  within 10 Business Days following the occurrence of an event
     that requires an adjustment to the Settlement Rate pursuant to Section 5.04
     (or if the Company is not aware of such occurrence, as soon as practicable
     after becoming so aware), provide a written notice to the Holders of the
     Securities of the occurrence of such event and a statement in reasonable
     detail setting forth the method by which the adjustment to the Settlement
     Rate was determined and setting forth the adjusted Settlement Rate.

     (b) The Purchase Contract Agent shall not at any time be under any duty or
responsibility to any Holder of Securities to determine whether any facts exist
which may require any adjustment of the Settlement Rate, or with respect to the
nature or extent or calculation of any such adjustment when made, or with
respect to the method employed in making the same. The Purchase Contract Agent
shall not be accountable with respect to the validity or value (or the kind or
amount) of any shares of Common Stock, or of any securities or property, which
may at the time be issued or delivered with respect to any Purchase Contract;
and the Purchase Contract Agent makes no representation with respect thereto.
The Purchase Contract Agent shall not be responsible for any failure of the
Company to issue, transfer or deliver any shares of Common Stock pursuant to a
Purchase Contract or to comply with any of the duties, responsibilities or
covenants of the Company contained in this Article.

     SECTION 5.06. TERMINATION EVENT; NOTICE.

     The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Purchase Contract
Payments (including any deferred or accrued and unpaid Purchase Contract
Payments), if the Company shall have such obligation, and the rights and
obligations of Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Purchase Contract Agent or the Company, if, prior to or on the
Purchase Contract Settlement Date, a Termination Event shall have occurred.

     Upon and after the occurrence of a Termination Event, the Securities shall
thereafter represent the right to receive the Preferred Securities, the
[Subordinated] Notes, the Treasury Securities or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case

                                       50


may be, forming part of such Securities, in accordance with the provisions of
Section 5.04 of the Pledge Agreement. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Purchase Contract Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Security
Register.

     SECTION 5.07. EARLY SETTLEMENT.

     (a) Subject to and upon compliance with the provisions of this Section
5.07, at the option of the Holder thereof, Purchase Contracts underlying
Securities may be settled early ("EARLY SETTLEMENT") on or prior to 5:00 p.m.
(New York City time) on the seventh Business Day immediately preceding the
Purchase Contract Settlement Date. Holders of Treasury Stock Purchase Units may
only settle the related Purchase Contracts in integral multiples of 40 Purchase
Contracts. In order to exercise the right to effect Early Settlement with
respect to any Purchase Contracts, the Holder of the Certificate evidencing
Securities shall deliver to the Purchase Contract Agent at the Corporate Trust
Office an "Election to Settle Early" form (on the reverse side of the
Certificate) and any other documents requested by the Purchase Contract Agent
and accompanied by payment (payable to the Company in immediately available
funds) in an amount (the "EARLY SETTLEMENT AMOUNT") equal to the product of (i)
(A) the Stated Amount times (B) the number of Purchase Contracts with respect to
which the Holder has elected to effect Early Settlement, plus (ii) if such
delivery is made with respect to any Purchase Contracts during the period from
the close of business on any Record Date next preceding any Payment Date to the
opening of business on such Payment Date, an amount equal to the Purchase
Contract Payments payable on such Payment Date with respect to such Purchase
Contracts.

          Except as provided in the immediately preceding sentence and subject
to Section 5.11(c), no payment shall be made upon Early Settlement of any
Purchase Contract on account of any Purchase Contract Payments accrued on such
Purchase Contract or on account of dividends payable on the Common Stock issued
upon such Early Settlement, the record date for which payment occurs prior to
the Early Settlement Date. If the foregoing requirements are first satisfied
with respect to Purchase Contracts underlying any Securities prior to or at 5:00
p.m. (New York City time) on a Business Day, such day shall be the "EARLY
SETTLEMENT DATE" with respect to such Securities and if such requirements are
first satisfied after 5:00 p.m. (New York City time) on a Business Day or on a
day that is not a Business Day, the "EARLY SETTLEMENT DATE" with respect to such
Securities shall be the next succeeding Business Day (so long as such next
succeeding Business Day is not later than the seventh Business Day immediately
preceding the Purchase Contract Settlement Date).

     (b) No Early Settlement will be permitted under this Section 5.07 unless,
at the time of delivery of the Election to Settle Early form or time the Early
Settlement is effected, there is an effective Registration Statement with
respect to the shares of Common Stock to be issued and delivered in connection
with such Early Settlement, if such a Registration Statement is required (in the
view of counsel, which need not be in the form of a written opinion, for either
the

                                       51


Company or the Purchase Contract Agent) under the Securities Act. If such a
Registration Statement is so required, the Company covenants and agrees to use
its best efforts to (A) have in effect a Registration Statement covering the
shares of Common Stock to be delivered in respect of the Purchase Contracts
being settled and (B) provide a Prospectus in connection therewith, in each case
in a form that the Purchase Contract Agent may use in connection with such Early
Settlement.

     (c) Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Company shall issue, and the Holder shall be entitled to receive
_______ share of Common Stock on account of each Purchase Contract as to which
Early Settlement is effected (the "EARLY SETTLEMENT RATE"). The Early Settlement
Rate shall be adjusted in the same manner and at the same time as the Settlement
Rate is adjusted.

     (d) Not later than the third Business Day after the applicable Early
Settlement Date, the Company shall cause:

            (i)  the shares of Common Stock issuable upon Early Settlement of
     Purchase Contracts to be issued and delivered, together with payment in
     lieu of any fraction of a share, as provided in Section 5.09; and

           (ii)  the related Preferred Securities, [Subordinated] Notes or the
     appropriate Applicable Ownership Interest (as specified in clause (A) of
     the definition of such term) of the Treasury Portfolio, in the case of
     Stock Purchase Units, or the related Treasury Securities, in the case of
     Treasury Stock Purchase Units, to be released from the Pledge by the
     Collateral Agent and transferred, in each case, to the Purchase Contract
     Agent for delivery to the Holder thereof or its designee.

     (e) Upon Early Settlement of any Purchase Contracts, and subject to
receipt of shares of Common Stock from the Company and the Preferred Securities,
[Subordinated] Notes, the appropriate Applicable Ownership Interest as specified
in clause (A) of the definition of such term) of the Treasury Portfolio, or
Treasury Securities, as the case may be, from the Securities Intermediary, as
applicable, the Purchase Contract Agent shall, in accordance with the
instructions provided by the Holder thereof on the Election to Settle Early form
(on the reverse of the Certificate evidencing the related Securities):

            (i)  transfer to the Holder the Preferred Securities, [Subordinated]
     Notes, the appropriate Applicable Ownership Interest (as specified in
     clause (A) of the definition of such term) of the Treasury Portfolio or
     Treasury Securities, as the case may be, forming a part of such Securities;

           (ii)  deliver to the Holder a certificate or certificates for the
     full number of shares of Common Stock issuable upon such Early Settlement,
     together with payment in lieu of any fraction of a share, as provided in
     Section 5.09; and

                                       52


          (iii)  if so required under the Securities Act, deliver a Prospectus
     for the shares of Common Stock issuable upon such Early Settlement as
     contemplated by Section 5.07(b).

     (f) In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Securities evidenced by a
Certificate, upon such Early Settlement the Company shall execute and the
Purchase Contract Agent shall authenticate, countersign and deliver to the
Holder thereof, at the expense of the Company, a Certificate evidencing the
Securities as to which Early Settlement was not effected.

     (g) A Holder of a Security who effects Early Settlement may elect to have
the Preferred Securities or [Subordinated] Notes, as the case may be, no longer
a part of a Stock Purchase Unit remarketed. A Holder making such an election
must notify the Property Trustee or the Indenture Trustee, as the case may be,
prior to 11:00 a.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, of the aggregate number of
Preferred Securities or [Subordinated] Notes that are not part of Stock Purchase
Units to be remarketed. Any such notice will be irrevocable and may not be
conditioned upon the level at which the Reset Rate is established in the
Remarketing. Concurrently, the Property Trustee or the Indenture Trustee, as the
case may be, shall cause such Preferred Securities or [Subordinated] Notes, as
the case may be, to be presented to the Remarketing Agent for Remarketing.

     SECTION 5.08. INTENTIONALLY OMITTED.

     SECTION 5.09. NO FRACTIONAL SHARES.

     No fractional shares or scrip representing fractional shares of Common
Stock shall be issued or delivered upon settlement on the Purchase Contract
Settlement Date or upon Early Settlement of any Purchase Contracts. If
Certificates evidencing more than one Purchase Contract shall be surrendered for
settlement at one time by the same Holder, the number of full shares of Common
Stock which shall be delivered upon settlement shall be computed on the basis of
the aggregate number of Purchase Contracts evidenced by the Certificates so
surrendered. Instead of any fractional share of Common Stock which would
otherwise be deliverable upon settlement of any Purchase Contracts on the
Purchase Contract Settlement Date or upon Early Settlement, the Company, through
the Purchase Contract Agent, shall make a cash payment in respect of such
fractional interest in an amount equal to the value of such fractional shares
times the Applicable Market Value. The Company shall provide the Purchase
Contract Agent from time to time with sufficient funds to permit the Purchase
Contract Agent to make all cash payments required by this Section 5.09 in a
timely manner.

     SECTION 5.10. CHARGES AND TAXES.

     The Company will pay all stock transfer and similar taxes attributable to
the initial issuance and delivery of the shares of Common Stock pursuant to the
Purchase Contracts;

                                       53


PROVIDED, HOWEVER, that the Company shall not be required to pay any such tax or
taxes which may be payable in respect of any exchange of or substitution for a
Certificate evidencing a Security or any issuance of a share of Common Stock in
a name other than that of the registered Holder of a Certificate surrendered in
respect of the Securities evidenced thereby, other than in the name of the
Purchase Contract Agent, as custodian for such Holder, and the Company shall not
be required to issue or deliver such share certificates or Certificates unless
or until the Person or Persons requesting the transfer or issuance thereof shall
have paid to the Company the amount of such tax or shall have established to the
satisfaction of the Company that such tax has been paid.

     SECTION 5.11. PURCHASE CONTRACT PAYMENTS.

     (a) Subject to Section 5.12, the Company shall pay, on each Payment Date,
the Purchase Contract Payments payable in respect of each Purchase Contract to
the Person in whose name a Certificate is registered at the close of business on
the Record Date next preceding such Payment Date. The Purchase Contract Payments
will be payable at the office of the Purchase Contract Agent in New York City
maintained for that purpose or, at the option of the Holder, by check mailed to
the address of the Person entitled thereto at such Person's address as it
appears on the Security Register. If any date on which Purchase Contract
Payments are to be made is not a Business Day, then payment of the Purchase
Contract Payments payable on such date will be made on the next succeeding day
that is a Business Day (and without any interest in respect of any such delay),
except that, if such Business Day is in the next succeeding calendar year, such
payment will be made on the immediately preceding Business Day. Purchase
Contract Payments payable for any period will be computed (i) for any full
quarterly period on the basis of a 360-day year of twelve 30-day months and (ii)
for any period shorter than a full quarterly period, on the basis of a 30-day
month and, for periods of less than a month, on the basis of the actual number
of days elapsed per 30-day month.

     (b) Upon the occurrence of a Termination Event, the Company's obligation
to pay future Purchase Contract Payments (including any accrued or deferred
Purchase Contract Payments) shall cease.

     (c) Each Certificate delivered under this Agreement upon registration of
transfer of or in exchange for or in lieu of (including as a result of a
Collateral Substitution or the reestablishment of Stock Purchase Units) any
other Certificate shall carry the right to accrued or deferred and unpaid
Purchase Contract Payments and the right to accrue Purchase Contract Payments,
which rights were carried by the Purchase Contracts underlying such other
Certificates.

     (d) Subject to Section 5.07, in the case of any Security with respect to
which Early Settlement of the underlying Purchase Contract is effected on an
Early Settlement Date that is after any Record Date and prior to or on the next
succeeding Payment Date, Purchase Contract Payments otherwise payable on such
Payment Date shall be payable on such Payment Date

                                       54


notwithstanding such Early Settlement, and such Purchase Contract Payments shall
be paid to the Person in whose name the Certificate evidencing such Security is
registered at the close of business on such Record Date. Except as otherwise
expressly provided in the immediately preceding sentence, in the case of any
Security with respect to which Early Settlement of the underlying Purchase
Contract is effected on an Early Settlement Date, Purchase Contract Payments
that would otherwise be payable after the Early Settlement Date with respect to
such Purchase Contract shall not be payable.

     SECTION 5.12. DEFERRAL OF PURCHASE CONTRACT PAYMENTS.

     (a) The Company has the right to defer payment of all or part of the
Purchase Contract Payments in respect of each Purchase Contract until no later
than the Purchase Contract Settlement Date, but only if the Company shall give
the Holders and the Purchase Contract Agent written notice of its election to
defer such payment (specifying the amount to be deferred) at least ten Business
Days prior to the earlier of (i) the next succeeding Payment Date or (ii) the
date the Company is required to give notice of the Record Date or Payment Date
with respect to payment of such Purchase Contract Payments to the NYSE or other
applicable self-regulatory organization or to Holders of the Securities, but in
any event not less than one Business Day prior to such Record Date. If the
Company so elects to defer Purchase Contract Payments, the Company shall pay
additional Purchase Contract Payments on such deferred installments of Purchase
Contract Payments at a rate equal to ___% per annum, compounding quarterly,
until such deferred installments are paid in full. Deferred Purchase Contract
Payments shall be due on the Payment Date except to the extent that payment is
deferred pursuant to this Section. Except as otherwise provided in Section
5.11(d), in the case of any Security with respect to which Early Settlement of
the underlying Purchase Contract is effected on an Early Settlement Date, the
Holder will have no right to receive any accrued or deferred Purchase Contract
Payments.

     (b) In the event the Company elects to defer the payment of Purchase
Contract Payments on the Purchase Contracts until the Purchase Contract
Settlement Date, each Holder will receive on the Purchase Contract Settlement
Date the aggregate amount of accrued and unpaid Purchase Contract Payments. The
Company shall pay such amounts on the Purchase Contract Settlement Date in the
manner described in Section 5.02(e).

     (c) In the event the Company exercises its option to defer the payment of
Purchase Contract Payments, then, until all deferred Purchase Contract Payments
have been paid, the Company shall not (a) make any payment of principal,
interest or premium, if any, on or repay, repurchase or redeem any debt
securities that rank junior to the [Subordinated] Notes in the right of payment
issued by the Company, or (b) make any guarantee payments with respect to any
guarantee by the Company of any securities of any of its subsidiaries if such
guarantee ranks junior to the [Subordinated] Notes in the right of payment, (c)
declare or pay any dividends or distributions on any of the Company's capital
stock or (d) redeem, purchase, acquire or make a liquidation payment with
respect to, any of the Company's capital stock. Notwithstanding the foregoing,
the Company may (1) purchase or acquire its capital stock in connection with the

                                       55


satisfaction by it of its obligations under any employee benefit plans or
pursuant to any contract or security outstanding on the first day of any such
event requiring it to purchase its capital stock; (2) reclassify its capital
stock or exchange or convert one class or series of its capital stock for
another class or series of its capital stock; (3) purchase fractional interests
in shares of its capital stock pursuant to the conversion or exchange provisions
of such capital stock or the security being converted or exchanged; (4) declare
dividends or distributions in its capital stock; (5) redeem or repurchase any
rights pursuant to a rights agreement; and (6) make payments under the Guarantee
related to the Preferred Securities.

                                    ARTICLE 6
                                    REMEDIES

     SECTION 6.01. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PURCHASE CONTRACT
PAYMENTS AND TO PURCHASE SHARES OF COMMON STOCK.

     Each Holder of a Security shall have the right, which is absolute and
unconditional, (i) subject to the right of the Company to defer such payments in
accordance with Section 5.12, to receive each Purchase Contract Payment with
respect to the Purchase Contract comprising part of such Security on the
respective Payment Date for such Security and (ii) to purchase shares of Common
Stock pursuant to such Purchase Contract and, in each such case, to institute
suit for the enforcement of any such right to receive Purchase Contract Payments
and the right to purchase shares of Common Stock, and such rights shall not be
impaired without the consent of such Holder.

     SECTION 6.02. RESTORATION OF RIGHTS AND REMEDIES.

     If any Holder has instituted any proceeding to enforce any right or remedy
under this Agreement and such proceeding has been discontinued or abandoned for
any reason, or has been determined adversely to such Holder, then and in every
such case, subject to any determination in such proceeding, the Company and such
Holder shall be restored severally and respectively to their former positions
hereunder and thereafter all rights and remedies of such Holder shall continue
as though no such proceeding had been instituted.

     SECTION 6.03. RIGHTS AND REMEDIES CUMULATIVE.

     Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Certificates in the last paragraph of
Section 3.10, no right or remedy herein conferred upon or reserved 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.

                                       56


     SECTION 6.04. DELAY OR OMISSION NOT WAIVER.

     No delay or omission of any Holder to exercise any right or remedy upon a
default shall impair any such right or remedy or constitute a waiver of any such
right. Every right and remedy given by this Article or by law to the Holders may
be exercised from time to time, and as often as may be deemed expedient, by such
Holders.

     SECTION 6.05. UNDERTAKING FOR COSTS.

     All parties to this Agreement agree, and each Holder of a Security, by its
acceptance of such Security 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 Agreement, or in any suit against the Purchase Contract Agent
for any action taken, suffered or omitted by it as Purchase Contract Agent, the
filing by any party litigant in such suit of an undertaking to pay the costs of
such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees and costs 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; PROVIDED that the provisions of this
Section shall not apply to any suit instituted by the Purchase Contract Agent,
to any suit instituted by any Holder, or group of Holders, holding in the
aggregate more than 10% of the Outstanding Securities, or to any suit instituted
by any Holder for the enforcement of distributions on any Preferred Securities
or interest on any [Subordinated] Notes or Purchase Contract Payments on or
after the respective Payment Date therefor in respect of any Security held by
such Holder, or for enforcement of the right to purchase shares of Common Stock
under the Purchase Contracts constituting part of any Security held by such
Holder.

     SECTION 6.06. 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 Agreement; 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 Purchase Contract Agent or the Holders, but will
suffer and permit the execution of every such power as though no such law had
been enacted.

                                       57


                                    ARTICLE 7
                           THE PURCHASE CONTRACT AGENT

     SECTION 7.01. CERTAIN DUTIES AND RESPONSIBILITIES.

     (a) The Purchase Contract Agent:

     (1) undertakes to perform, with respect to the Securities, such duties and
only such duties as are specifically set forth in this Agreement and the Pledge
Agreement, and no implied covenants or obligations shall be read into this
Agreement or the Pledge Agreement against the Purchase Contract Agent; and

     (2) in the absence of bad faith or gross negligence on its part, may, with
respect to the Securities, conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Purchase Contract Agent and conforming to the
requirements of this Agreement or the Pledge Agreement, as applicable, but in
the case of any certificates or opinions which by any provision hereof are
specifically required to be furnished to the Purchase Contract Agent, the
Purchase Contract Agent shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this Agreement or the Pledge
Agreement, as applicable (but need not confirm or investigate the accuracy of
the mathematical calculations or other facts stated therein).

     (b) No provision of this Agreement or the Pledge Agreement shall be
construed to relieve the Purchase Contract Agent from liability for its own
grossly negligent action, its own grossly negligent failure to act, or its own
willful misconduct, except that:

     (1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;

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

     (3) no provision of this Agreement or the Pledge Agreement shall require
the Purchase Contract Agent 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 indemnity satisfactory to the
Purchase Contract Agent is not provided to it; and

     (4) the Purchase Contract Agent shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of a majority in principal amount of the Outstanding
Securities.

                                       58


     (c) Whether or not therein expressly so provided, every provision of this
Agreement and the Pledge Agreement relating to the conduct or affecting the
liability of or affording protection to the Purchase Contract Agent shall be
subject to the provisions of this Section.

     (d) The Purchase Contract Agent is authorized to execute and deliver the
Pledge Agreement in its capacity as Purchase Contract Agent.

     SECTION 7.02. NOTICE OF DEFAULT.

     Within 30 days after the occurrence of any default by the Company hereunder
of which a Responsible Officer of the Purchase Contract Agent has actual
knowledge, the Purchase Contract Agent shall transmit by mail to the Company and
the Holders of Securities, as their names and addresses appear in the Security
Register, notice of such default hereunder, unless such default shall have been
cured or waived.

     SECTION 7.03. CERTAIN RIGHTS OF PURCHASE CONTRACT AGENT.

     Subject to the provisions of Section 7.01:

     (1) the Purchase Contract Agent may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, [Subordinated] Note, 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;

     (2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officers' Certificate, Issuer Order or Issuer
Request, and any resolution of the Board of Directors of the Company may be
sufficiently evidenced by a Board Resolution;

     (3) whenever in the administration of this Agreement or the Pledge
Agreement the Purchase Contract Agent shall deem it desirable that a matter be
proved or established prior to taking, suffering or omitting any action
hereunder, the Purchase Contract Agent (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part,
conclusively rely upon an Officers' Certificate of the Company;

     (4) the Purchase Contract Agent may consult with counsel of its selection
appointed with due care by it hereunder and the advice of such counsel or any
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon;

     (5) the Purchase Contract Agent 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

                                       59


paper or document, but the Purchase Contract Agent, in its discretion, and at
the expense of the Company, may make reasonable further inquiry or investigation
into such facts or matters related to the execution, delivery and performance of
the Purchase Contracts as it may see fit, and, if the Purchase Contract Agent
shall determine to make such further inquiry or investigation, it shall be given
a reasonable opportunity to examine the relevant books, records and premises of
the Company, personally or by agent or attorney and shall incur no liability or
additional liability of any kind by reason of such inquiry or investigation;

     (6) the Purchase Contract Agent may execute any of the powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys or an Affiliate and the Purchase Contract Agent shall not be
responsible for any misconduct or negligence on the part of any agent or
attorney or an Affiliate appointed with due care by it hereunder;

     (7) the Purchase Contract Agent shall be under no obligation to exercise
any of the rights or powers vested in it by this Agreement at the request or
direction of any of the Holders pursuant to this Agreement, unless such Holders
shall have offered to the Purchase Contract Agent security or indemnity
satisfactory to the Purchase Contract Agent against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction;

     (8) the Purchase Contract Agent shall not be liable for any action taken,
suffered, or omitted to be taken by it in good faith and reasonably believed by
it to be authorized or within the discretion or rights or powers conferred upon
it by this Agreement;

     (9) the Purchase Contract Agent shall not be deemed to have notice of any
default hereunder unless a Responsible Officer of the Purchase Contract Agent
has actual knowledge thereof or unless written notice of any event which is in
fact such a default is received by the Purchase Contract Agent at the Corporate
Trust Office of the Purchase Contract Agent, and such notice references the
Securities and this Agreement;

    (10) the Purchase Contract Agent may request that the Company deliver an
Officers' Certificate setting forth the names of individuals and/or titles of
officers authorized at such time to take specified actions pursuant to this
Agreement, which Officers' Certificate may be signed by any person authorized to
sign an Officers' Certificate, including any person specified as so authorized
in any such certificate previously delivered and not superseded; and

    (11) the rights, privileges, protections, immunities and benefits given to
the Purchase Contract Agent, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Purchase Contract
Agent in each of its capacities hereunder, and to each agent, custodian and
other Person employed to act hereunder.

                                       60


     SECTION 7.04. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.

     The recitals contained herein and in the Certificates shall be taken as the
statements of the Company, and the Purchase Contract Agent assumes no
responsibility for their accuracy. The Purchase Contract Agent makes no
representations as to the validity or sufficiency of either this Agreement or of
the Securities, or of the Pledge Agreement or the Pledge. The Purchase Contract
Agent shall not be accountable for the use or application by the Company of the
proceeds in respect of the Purchase Contracts.

     SECTION 7.05. MAY HOLD SECURITIES.

     Any Security Registrar or any other agent of the Company, or the Purchase
Contract Agent and its Affiliates, in their individual or any other capacity,
may become the owner or pledgee of Securities and may otherwise deal with the
Company, the Collateral Agent or any other Person with the same rights it would
have if it were not Security Registrar or such other agent, or the Purchase
Contract Agent. The Company may become the owner or pledgee of Securities.

     SECTION 7.06. MONEY HELD IN CUSTODY.

     Money held by the Purchase Contract Agent in custody hereunder need not be
segregated from the other funds except to the extent required by law or provided
herein. The Purchase Contract Agent shall be under no obligation to invest or
pay interest on any money received by it hereunder except as otherwise provided
hereunder or agreed in writing with the Company.

     SECTION 7.07. COMPENSATION AND REIMBURSEMENT.

     The Company agrees:

     (1) to pay to the Purchase Contract Agent compensation for all services
rendered by it hereunder and under the Pledge Agreement as the Company and the
Purchase Contract Agent shall from time to time agree in writing;

     (2) except as otherwise expressly provided for herein, to reimburse the
Purchase Contract Agent upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Purchase Contract Agent in
accordance with any provision of this Agreement and the Pledge Agreement
(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 gross negligence, willful misconduct or bad faith; and

     (3) to indemnify the Purchase Contract Agent and any predecessor Purchase
Contract Agent for, and to hold it harmless against, any loss, liability or
expense incurred without gross negligence, willful misconduct or bad faith on
its part, arising out of or in connection with the acceptance or administration
of its duties hereunder, including the costs and expenses of

                                       61


defending itself against any claim (whether asserted by the Company, a Holder or
any other person) or liability in connection with the exercise or performance of
any of its powers or duties hereunder.

     The provisions of this Section shall survive the resignation and removal of
the Purchase Contract Agent and the termination of this Agreement.

     SECTION 7.08. CORPORATE PURCHASE CONTRACT AGENT REQUIRED; ELIGIBILITY.

     There shall at all times be a Purchase Contract Agent hereunder 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 (or being a member of
a bank holding company having) a combined capital and surplus of at least
$50,000,000, subject to supervision or examination by Federal or State authority
and having a corporate trust office in the Borough of Manhattan, New York City,
if there be such a corporation in the Borough of Manhattan, New York City,
qualified and eligible under this Article and willing to act on reasonable
terms. 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, 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 Purchase Contract Agent shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.

     SECTION 7.09. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.

     (a) No resignation or removal of the Purchase Contract Agent and no
appointment of a successor Purchase Contract Agent pursuant to this Article
shall become effective until the acceptance of appointment by the successor
Purchase Contract Agent in accordance with the applicable requirements of
Section 7.10.

     (b) The Purchase Contract Agent may resign at any time by giving written
notice thereof to the Company 60 days prior to the effective date of such
resignation. If the instrument of acceptance by a successor Purchase Contract
Agent required by Section 7.10 shall not have been delivered to the Purchase
Contract Agent within 30 days after the giving of such notice of resignation,
the resigning Purchase Contract Agent may petition, at the expense of the
Company, any court of competent jurisdiction for the appointment of a successor
Purchase Contract Agent.

     (c) The Purchase Contract Agent may be removed at any time by Act of the
Holders of a majority in number of the Outstanding Securities delivered to the
Purchase Contract Agent and the Company. If the instrument of acceptance by a
successor Purchase Contract Agent required by Section 7.10 shall not have been
delivered to the Purchase Contract Agent within 30 days after the giving of such
notice of resignation, the resigning Purchase Contract Agent may

                                       62


petition, at the expense of the Company, any court of competent jurisdiction for
the appointment of a successor Purchase Contract Agent.

     (d) If at any time:

            (1)  the Purchase Contract Agent fails to comply with Section 310(b)
     of the TIA, as if the Purchase Contract Agent were an indenture trustee
     under an indenture qualified under the TIA, 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;

            (2)  the Purchase Contract Agent shall cease to be eligible under
     Section 7.08 and shall fail to resign after written request therefor by the
     Company or by any such Holder; or

            (3)  the Purchase Contract Agent shall become incapable of acting or
     shall be adjudged a bankrupt or insolvent or a receiver of the Purchase
     Contract Agent or of its property shall be appointed or any public officer
     shall take charge or control of the Purchase Contract Agent 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
Purchase Contract Agent, or (ii) 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 Purchase Contract Agent and the appointment of a successor Purchase
Contract Agent.

     (e) If the Purchase Contract Agent shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Purchase
Contract Agent for any cause, the Company, by a Board Resolution, shall promptly
appoint a successor Purchase Contract Agent and shall comply with the applicable
requirements of Section 7.10. If no successor Purchase Contract Agent shall have
been so appointed by the Company and accepted appointment in the manner required
by Section 7.10, any Holder who has been a bona fide Holder of a Security for at
least six months, on behalf of itself and all others similarly situated, or the
Purchase Contract Agent may petition at the expense of the Company, any court of
competent jurisdiction for the appointment of a successor Purchase Contract
Agent.

     (f) The Company shall give, or shall cause such successor Purchase
Contract Agent to give, notice of each resignation and each removal of the
Purchase Contract Agent and each appointment of a successor Purchase Contract
Agent by mailing written notice of such event by first-class mail, postage
prepaid, to all Holders as their names and addresses appear in the applicable
Register. Each notice shall include the name of the successor Purchase Contract
Agent and the address of its Corporate Trust Office.

                                       63


     SECTION 7.10. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.

     (a) In case of the appointment hereunder of a successor Purchase Contract
Agent, every such successor Purchase Contract Agent so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Purchase Contract
Agent an instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Purchase Contract Agent shall become effective and such
successor Purchase Contract Agent, without any further act, deed or conveyance,
shall become vested with all the rights, powers, agencies and duties of the
retiring Purchase Contract Agent; but, on the request of the Company or the
successor Purchase Contract Agent, such retiring Purchase Contract Agent shall,
upon payment of its charges, execute and deliver an instrument transferring to
such successor Purchase Contract Agent all the rights, powers and trusts of the
retiring Purchase Contract Agent and shall duly assign, transfer and deliver to
such successor Purchase Contract Agent all property and money held by such
retiring Purchase Contract Agent hereunder.

     (b) Upon request of any such successor Purchase Contract Agent, the
Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Purchase Contract Agent all such
rights, powers and agencies referred to in paragraph 7.10(a) of this Section.

     (c) No successor Purchase Contract Agent shall accept its appointment
unless at the time of such acceptance such successor Purchase Contract Agent
shall be qualified and eligible under this Article.

     SECTION 7.11. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.

     Any corporation into which the Purchase Contract 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 the Purchase Contract
Agent shall be a party, or any corporation succeeding to all or substantially
all the corporate trust business of the Purchase Contract Agent, shall be the
successor of the Purchase Contract Agent hereunder, PROVIDED that such
corporation shall be otherwise qualified and eligible under this Article, with
the execution or filing of any paper or any further act on the part of any of
the parties hereto. In case any Certificates shall have been authenticated and
executed on behalf of the Holders, but not delivered, by the Purchase Contract
Agent then in office, any successor by merger, conversion or consolidation to
such Purchase Contract Agent may adopt such authentication and execution and
deliver the Certificates so authenticated and executed with the same effect as
if such successor Purchase Contract Agent had itself authenticated and executed
such Securities.

     SECTION 7.12. PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.

     (a) The Purchase Contract Agent shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders received by the
Purchase Contract Agent in its

                                       64


capacity as Security Registrar.

     (b) If three or more Holders (herein referred to as "applicants") apply in
writing to the Purchase Contract Agent, and furnish to the Purchase Contract
Agent reasonable proof that each such applicant has owned a Security for a
period of at least six months preceding the date of such application, and such
application states that the applicants desire to communicate with other Holders
with respect to their rights under this Agreement or under the Securities and is
accompanied by a copy of the form of proxy or other communication which such
applicants propose to transmit, then the Purchase Contract Agent shall mail to
all the Holders copies of the form of proxy or other communication which is
specified in such request, with reasonable promptness after a tender to the
Purchase Contract Agent of the materials to be mailed and of payment, or
provision for the payment, of the reasonable expenses of such mailing.

     SECTION 7.13. NO OBLIGATIONS OF PURCHASE CONTRACT AGENT.

     Except to the extent otherwise expressly provided in this Agreement, the
Purchase Contract Agent assumes no obligations and shall not be subject to any
liability under this Agreement, the Pledge Agreement or any Purchase Contract in
respect of the obligations of the Holder of any Security thereunder. The Company
agrees, and each Holder of a Certificate, by his or her acceptance thereof,
shall be deemed to have agreed, that the Purchase Contract Agent's execution of
the Certificates on behalf of the Holders shall be solely as agent and
attorney-in-fact for the Holders, and that the Purchase Contract Agent shall
have no obligation to perform such Purchase Contracts on behalf of the Holders,
except to the extent expressly provided in Article Five hereof. Anything
contained in this Agreement to the contrary notwithstanding, in no event shall
the Purchase Contract Agent or its officers, employees or agents be liable under
this Agreement to any third party for indirect, special, punitive, or
consequential loss or damage of any kind whatsoever, including lost profits,
whether or not the likelihood of such loss or damage was known to the Purchase
Contract Agent, incurred without any act or deed that is found to be
attributable to gross negligence or willful misconduct on the part of the
Purchase Contract Agent.

     SECTION 7.14. TAX COMPLIANCE.

     (a) The Company and the Purchase Contract Agent will comply with all
applicable certification, information reporting and withholding (including
"backup" withholding) requirements imposed by applicable tax laws, regulations
or administrative practice with respect to (i) any payments made with respect to
the Securities or (ii) the issuance, delivery, holding, transfer, redemption or
exercise of rights under the Securities. Such compliance shall include, without
limitation, the preparation and timely filing of required returns and the timely
payment of all amounts required to be withheld to the appropriate taxing
authority or its designated agent.

     (b) The Purchase Contract Agent shall comply in accordance with the terms
hereof with any written direction received from the Company with respect to the
execution or certification of any required documentation and the application of
such requirements to particular payments or

                                       65


Holders or in other particular circumstances, and may for purposes of this
Agreement conclusively rely on any such direction in accordance with the
provisions of Section 7.01(a)(2) hereof.

     (c) The Purchase Contract Agent shall maintain all appropriate records
documenting compliance with such requirements, and shall make such records
available, on written request, to the Company or its authorized representative
within a reasonable period of time after receipt of such request.

                                    ARTICLE 8
                             SUPPLEMENTAL AGREEMENTS

     SECTION 8.01. SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF HOLDERS.

     Without the consent of any Holders, the Company and the Purchase Contract
Agent, at any time and from time to time, may enter into one or more agreements
supplemental hereto, in form satisfactory to the Company and the Purchase
Contract Agent, to:

            (1)  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 Certificates;

            (2)  evidence and provide for the acceptance of appointment
     hereunder by a successor Purchase Contract Agent;

            (3)  add to the covenants of the Company for the benefit of the
     Holders, or surrender any right or power herein conferred upon the Company;

            (4)  make provision with respect to the rights of Holders pursuant
     to the requirements of Section 5.04(b); or

            (5)  except as provided for in Section 5.04, cure any ambiguity,
     correct or supplement any provisions herein which may be inconsistent with
     any other provisions herein, or make any other provisions with respect to
     such matters or questions arising under this Agreement, PROVIDED that such
     action shall not adversely affect the interests of the Holders.

     SECTION 8.02. SUPPLEMENTAL AGREEMENTS WITH CONSENT OF HOLDERS.

     With the consent of the Holders of not less than a majority of the
outstanding Securities voting together as one class, by Act of said Holders
delivered to the Company and the Purchase

                                       66


Contract Agent, the Company, when authorized by a Board Resolution, and the
Purchase Contract Agent may enter into an agreement or agreements supplemental
hereto for the purpose of modifying in any manner the terms of the Purchase
Contracts, or the provisions of this Agreement or the rights of the Holders in
respect of the Securities; PROVIDED, HOWEVER, that, except as contemplated
herein, no such supplemental agreement shall, without the unanimous consent of
the Holders of each outstanding Purchase Contract affected thereby,

            (1)  change any Payment Date;

            (2)  change the amount or the type of Collateral required to be
     Pledged to secure a Holder's obligations under the Purchase Contract,
     impair the right of the Holder of any Purchase Contract to receive
     distributions on the related Collateral (except for the rights of Holders
     of Stock Purchase Units to substitute Treasury Securities for the Pledged
     Preferred Securities or Pledged [Subordinated] Notes or the rights of
     Holders of Treasury Stock Purchase Units to substitute Preferred Securities
     or [Subordinated] Notes for the Pledged Treasury Securities) or otherwise
     adversely affect the Holder's rights in or to such Collateral or adversely
     alter the rights in or to such Collateral;

            (3)  impair the right to institute suit for the enforcement of any
     Purchase Contract;

            (4)  reduce the number of shares of Common Stock to be purchased
     pursuant to any Purchase Contract, increase the price to purchase shares of
     Common Stock upon settlement of any Purchase Contract or change the
     Purchase Contract Settlement Date;

            (5)  reduce the percentage of the outstanding Purchase Contracts the
     consent of whose Holders is required for any such supplemental agreement;
     or

            (6)  reduce any Purchase Contract Payments or change any place
     where, or the coin or currency in which, any Purchase Contract Payment is
     payable;

PROVIDED that if any amendment or proposal referred to above would adversely
affect only the Stock Purchase Units or the Treasury Stock Purchase Units, then
only the affected class of Holders as of the record date for the Holders
entitled to vote thereon will be entitled to vote on such amendment or proposal,
and such amendment or proposal shall not be effective except with the consent of
Holders of not less than a majority of such class; and PROVIDED, FURTHER, that
the unanimous consent of the Holders of each outstanding Purchase Contract of
such class affected thereby shall be required to approve any amendment or
proposal specified in clauses (1) through (6) above.

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

                                       67


     SECTION 8.03. EXECUTION OF SUPPLEMENTAL AGREEMENTS.

     In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Purchase Contract Agent shall be
provided, and (subject to Section 7.01) shall be fully protected in relying
upon, an Officers' Certificate and an Opinion of Counsel stating that the
execution of such supplemental agreement is authorized or permitted by this
Agreement and that any and all conditions precedent to the execution and
delivery of such supplemental agreement have been satisfied. The Purchase
Contract Agent may, but shall not be obligated to, enter into any such
supplemental agreement which affects the Purchase Contract Agent's own rights,
duties or immunities under this Agreement or otherwise.

     SECTION 8.04. EFFECT OF SUPPLEMENTAL AGREEMENTS.

     Upon the execution of any supplemental agreement under this Article, this
Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of this Agreement for all purposes; and every Holder
of Certificates theretofore or thereafter authenticated, executed on behalf of
the Holders and delivered hereunder, shall be bound thereby.

     SECTION 8.05. REFERENCE TO SUPPLEMENTAL AGREEMENTS.

     Certificates authenticated, executed on behalf of the Holders and delivered
after the execution of any supplemental agreement pursuant to this Article may,
and shall if required by the Purchase Contract Agent, bear a notation in form
approved by the Purchase Contract Agent as to any matter provided for in such
supplemental agreement. If the Company shall so determine, new Certificates so
modified as to conform, in the opinion of the Purchase Contract Agent and the
Company, to any such supplemental agreement may be prepared and executed by the
Company and authenticated, executed on behalf of the Holders and delivered by
the Purchase Contract Agent in exchange for outstanding Certificates.

                                    ARTICLE 9
              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

     SECTION 9.01. COVENANT NOT TO CONSOLIDATE, MERGE, CONVEY, TRANSFER OR LEASE
PROPERTY EXCEPT UNDER CERTAIN CONDITIONS.

     The Company covenants that it will not consolidate with or merge into any
other corporation or convey, transfer or lease all or substantially all of its
properties and assets to any Person, unless:

            (i)  the corporation formed by such consolidation or into which the
     Company is merged or the Person which acquires by conveyance or transfer,
     or which leases, all or

                                       68


     substantially all of the Company's properties and assets shall be a
     corporation organized and existing under the laws of the United States of
     America or a State thereof or the District of Columbia and such corporation
     shall expressly assume all the obligations of the Company under the
     Purchase Contracts, this Agreement and the Pledge Agreement by one or more
     supplemental agreements in form reasonably satisfactory to the Purchase
     Contract Agent and the Collateral Agent, executed and delivered to the
     Purchase Contract Agent and the Collateral Agent by such corporation; and

           (ii)  the Company or such successor corporation, as the case may be,
     shall not, immediately after such consolidation, merger, conveyance,
     transfer or lease, be in default in the performance of any covenant or
     condition hereunder, under any of the Securities or under the Pledge
     Agreement.

     SECTION 9.02. RIGHTS AND DUTIES OF SUCCESSOR CORPORATION.

     In case of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance and upon any such assumption by a
successor corporation in accordance with Section 9.01, such successor
corporation shall succeed to and be substituted for the Company with the same
effect as if it had been named herein as the Company. Such successor corporation
thereupon may cause to be signed, and may issue either in its own name or in the
name of Cinergy Corp., any or all of the Certificates evidencing Securities
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Purchase Contract Agent; and, upon the order of such
successor corporation, instead of the Company, and subject to all the terms,
conditions and limitations in this Agreement prescribed, the Purchase Contract
Agent shall authenticate and execute on behalf of the Holders and deliver any
Certificates which previously shall have been signed and delivered by the
officers of the Company to the Purchase Contract Agent for authentication and
execution, and any Certificate evidencing Securities which such successor
corporation thereafter shall cause to be signed and delivered to the Purchase
Contract Agent for that purpose. All the Certificates issued shall in all
respects have the same legal rank and benefit under this Agreement as the
Certificates theretofore or thereafter issued in accordance with the terms of
this Agreement as though all of such Certificates had been issued at the date of
the execution hereof.

     In case of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance such change in phraseology and form
(but not in substance) may be made in the Certificates evidencing Securities
thereafter to be issued as may be appropriate.

     SECTION 9.03. OFFICERS' CERTIFICATE AND OPINION OF COUNSEL GIVEN TO
PURCHASE CONTRACT AGENT.

     The Purchase Contract Agent, subject to Sections 7.01 and 7.03, shall
receive an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that any such merger, consolidation, share exchange, sale, assignment,
transfer, lease or conveyance, and any such

                                       69


assumption, complies with the provisions of this Article and that all conditions
precedent to the consummation of any such merger, consolidation, share exchange,
sale, assignment, transfer, lease or conveyance have been met.

                                   ARTICLE 10
                                    COVENANTS

     SECTION 10.01.  PERFORMANCE UNDER PURCHASE CONTRACTS.

     The Company covenants and agrees for the benefit of the Holders from time
to time of the Securities that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.

     SECTION 10.02. MAINTENANCE OF OFFICE OR AGENCY.

     The Company will maintain in the Borough of Manhattan, New York City an
office or agency where Certificates may be presented or surrendered for
acquisition of shares of Common Stock upon settlement of the Purchase Contracts
on the Purchase Contract Settlement Date or Early Settlement and for transfer of
Collateral upon occurrence of a Termination Event, where Certificates may be
surrendered for registration of transfer or exchange, for a Collateral
Substitution or reestablishment of Stock Purchase Units and where notices and
demands to or upon the Company in respect of the Securities and this Agreement
may be served. The Company will give prompt written notice to the Purchase
Contract Agent 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 Purchase Contract Agent with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the Corporate Trust Office, and the Company hereby appoints the
Purchase Contract Agent as its agent to receive all such presentations,
surrenders, notices and demands.

     The Company may also from time to time designate one or more other offices
or agencies where Certificates 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 the Borough of
Manhattan, New York City for such purposes. The Company will give prompt written
notice to the Purchase Contract Agent of any such designation or rescission and
of any change in the location of any such other office or agency. The Company
hereby designates as the place of payment for the Securities the Corporate Trust
Office and appoints the Purchase Contract Agent at its Corporate Trust Office as
paying agent in such city.

                                       70


     SECTION 10.03. COMPANY TO RESERVE COMMON STOCK.

     The Company shall at all times prior to the Purchase Contract Settlement
Date reserve and keep available, free from preemptive rights, out of its
authorized but unissued Common Stock the full number of shares of Common Stock
issuable against tender of payment in respect of all Purchase Contracts
constituting a part of the Securities evidenced by Outstanding Certificates.

     SECTION 10.04. COVENANTS AS TO COMMON STOCK.

     The Company covenants that all shares of Common Stock which may be issued
against tender of payment in respect of any Purchase Contract constituting a
part of the Outstanding Securities will, upon issuance, be duly authorized,
validly issued, fully paid and nonassessable.

     SECTION 10.05. STATEMENTS OF OFFICERS OF THE COMPANY AS TO DEFAULT.

     The Company will deliver to the Purchase Contract Agent, within 120 days
after the end of each fiscal year of the Company (which as of the date hereof is
December 31) ending after the date hereof, an Officers' Certificate (one of the
signers of which shall be the principal executive officer, principal financial
officer or principal accounting officer of the Company), stating whether or not
to the knowledge of the signers thereof the Company is in default in the
performance and observance of any of the terms, provisions and conditions
hereof, 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 10.06. ERISA.

     Each Holder from time to time of the Securities that is a Plan hereby
represents that its acquisition of the Stock Purchase Units and the holding of
the same satisfies the applicable fiduciary requirements of ERISA and that it is
entitled to exemption relief from the prohibited transaction provisions of ERISA
and the Code in accordance with one or more prohibited transaction exemptions or
otherwise will not result in a nonexempt prohibited transaction.

                       [SIGNATURES ON THE FOLLOWING PAGE]

                                       71


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


                                          CINERGY CORP.


                                          By:
                                              ----------------------------------
                                              Name:
                                              Title:


                                          [                                 ],
                                          as Purchase Contract Agent


                                          By:
                                              ----------------------------------
                                              Name:
                                              Title:



                                                                       EXHIBIT A

                    FACE OF STOCK PURCHASE UNITS CERTIFICATE

     [THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"),
OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR
CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS
CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.

     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

No. ____                                                  CUSIP No._____________
Number of Stock Purchase Units:______________

                                  CINERGY CORP.
                               CC FUNDING TRUST II
                              STOCK PURCHASE UNITS

     This Stock Purchase Units Certificate certifies that ___________________ is
the registered Holder of the number of Stock Purchase Units set forth above.
Each Stock Purchase Unit consists of (i) either (a) the beneficial ownership by
the Holder of one Preferred Security (the "PREFERRED SECURITY") of CC Funding
Trust II, a Delaware statutory trust (the "TRUST"), having a stated liquidation
amount of $    , subject to the Pledge of such Preferred Security by such Holder
pursuant to the Pledge Agreement, or (b) upon the occurrence of a Tax Event
Redemption prior to the Purchase Contract Settlement Date, the appropriate
Applicable



Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio by such Holder pursuant to the Pledge Agreement, and
(ii) the rights and obligations of the Holder under one Purchase Contract with
Cinergy Corp., a Delaware corporation (the "COMPANY"). All capitalized terms
used herein which are defined in the Purchase Contract Agreement (as defined on
the reverse hereof) have the meaning set forth therein.

     Pursuant to the Pledge Agreement, the Preferred Securities or the
appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, as the case may be,
constituting part of each Stock Purchase Unit evidenced hereby has been pledged
to the Collateral Agent, for the benefit of the Company, to secure the
obligations of the Holder under the Purchase Contract comprising part of such
Stock Purchase Unit.

     The Pledge Agreement provides that all payments of the liquidation amount
with respect to any of the Pledged Preferred Securities or the appropriate
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio, as the case may be, or cash distributions
on any Pledged Preferred Securities (as defined in the Pledge Agreement) or the
appropriate Applicable Ownership Interest (as specified in clause (B) of the
definition of such term) of the Treasury Portfolio, as the case may be,
constituting part of the Stock Purchase Units received by the Securities
Intermediary shall be paid by wire transfer in same day funds (i) in the case of
(A) cash distributions with respect to Pledged Preferred Securities or the
appropriate Applicable Ownership Interest (as specified in clause (B) of the
definition of such term) of the Treasury Portfolio, as the case may be, and (B)
any payments of the liquidation amount with respect to any Preferred Securities
or the appropriate Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio, as the case may be, that
have been released from the Pledge pursuant to the Pledge Agreement, to the
Purchase Contract Agent to the account designated by the Purchase Contract
Agent, no later than 2:00 p.m., New York City time, on the Business Day such
payment is received by the Securities Intermediary (PROVIDED that in the event
such payment is received by the Securities Intermediary on a day that is not a
Business Day or after 12:30 p.m., New York City time, on a Business Day, then
such payment shall be made no later than 10:30 a.m., New York City time, on the
next succeeding Business Day) and (ii) in the case of payments of the
liquidation amount with respect to any of the Pledged Preferred Securities or
the appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, to the Company on the
Purchase Contract Settlement Date (as described herein) in accordance with the
terms of the Pledge Agreement, in full satisfaction of the respective
obligations of the Holders of the Stock Purchase Units of which such Pledged
Preferred Securities or the Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, as the
case may be, are a part under the Purchase Contracts forming a part of such
Stock Purchase Units. Distributions on any Preferred Security or the appropriate
Applicable Ownership Interest (as specified in clause (B) of the definition of
such term) of the Treasury Portfolio, as the case may be, forming part of a
Stock Purchase Unit evidenced hereby, which are payable quarterly in arrears on
_______________, ___________________, ________________, and ________________ of
each year, commencing

                                       A-2


______________, 2003 (a "PAYMENT DATE"), shall, subject to receipt thereof by
the Purchase Contract Agent from the Securities Intermediary, be paid to the
Person in whose name this Stock Purchase Unit Certificate (or a Predecessor
Stock Purchase Unit Certificate) is registered at the close of business on the
Record Date for such Payment Date.

     Each Purchase Contract evidenced hereby obligates the Holder of this Stock
Purchase Units Certificate to purchase, and the Company to sell, on
_________________ (the "PURCHASE CONTRACT SETTLEMENT DATE"), at a price equal to
$25 (the "STATED AMOUNT"), a number of shares of Common Stock, without par value
("COMMON STOCK"), of the Company, equal to the Settlement Rate, unless on or
prior to the Purchase Contract Settlement Date there shall have occurred a
Termination Event or an Early Settlement with respect to the Stock Purchase Unit
of which such Purchase Contract is a part, all as provided in the Purchase
Contract Agreement and more fully described on the reverse hereof. The purchase
price (the "PURCHASE PRICE") for the shares of Common Stock purchased pursuant
to each Purchase Contract evidenced hereby, if not paid earlier, shall be paid
on the Purchase Contract Settlement Date by application of payment received in
respect of the liquidation amount with respect to any Pledged Preferred
Securities pursuant to the Remarketing or the appropriate Applicable Ownership
Interest (as specified in clause (A) of the definition of such term) of the
Treasury Portfolio, as the case may be, pledged to secure the obligations under
such Purchase Contract of the Holder of the Stock Purchase Unit of which such
Purchase Contract is a part.

     The Company shall pay, on each Payment Date, in respect of each Purchase
Contract forming part of a Stock Purchase Unit evidenced hereby, an amount (the
"PURCHASE CONTRACT PAYMENTS") equal to ___% per year of the Stated Amount. Such
Purchase Contract Payments shall be payable to the Person in whose name this
Stock Purchase Units Certificate is registered at the close of business on the
Record Date for such Payment Date. The Company may, at its option, defer such
Purchase Contract Payments.

     Distributions on the Preferred Securities and the Applicable Ownership
Interest (as specified in clause (B) of the definition of such term) and the
Purchase Contract Payments will be payable at the office of the Purchase
Contract Agent in New York City or, at the option of the Company, by check
mailed to the address of the Person entitled thereto as such address appears on
the Security Register.

     Reference is hereby made to the further provisions 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
Purchase Contract Agent by manual signature, this Stock Purchase Units
Certificate shall not be entitled to any benefit under the Pledge Agreement or
the Purchase Contract Agreement or be valid or obligatory for any purpose.

                                       A-3


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

                                        CINERGY CORP.


                                        By:
                                            ------------------------------------
                                            Name:
                                            Title:


                                        HOLDER SPECIFIED ABOVE (as to
                                        obligations of such Holder under the
                                        Purchase Contracts)


                                        By:[                               ],
                                        not individually but solely as
                                        Attorney-in-Fact of such Holder

                                        By:
                                            ------------------------------------
                                            Name:
                                            Title:

DATED:
      ------------------

                                       A-4


                          CERTIFICATE OF AUTHENTICATION
                           OF PURCHASE CONTRACT AGENT

     This is one of the Stock Purchase Units Certificates referred to in the
within mentioned Purchase Contract Agreement.

                                        By: [                              ],
                                        as Purchase Contract Agent


                                        By:
                                            ------------------------------------
                                                    Authorized Signatory
Dated:
      --------------------

                                       A-5


              (FORM OF REVERSE OF STOCK PURCHASE UNITS CERTIFICATE)

     Each Purchase Contract evidenced hereby is governed by a Purchase Contract
Agreement, dated as of _____________, 2003 (as may be supplemented from time to
time, the "PURCHASE CONTRACT AGREEMENT"), between the Company and [           ],
as Purchase Contract Agent (including its successors hereunder, the "PURCHASE
CONTRACT AGENT"), to which Purchase Contract Agreement and supplemental
agreements thereto reference is hereby made for a description of the respective
rights, limitations of rights, obligations, duties and immunities thereunder of
the Purchase Contract Agent, the Company, and the Holders and of the terms upon
which the Stock Purchase Units Certificates are, and are to be, executed and
delivered.

     Unless a Cash Settlement or an Early Settlement has occurred, each Purchase
Contract evidenced hereby obligates the Holder of this Stock Purchase Units
Certificate to purchase, and the Company to sell, on the Purchase Contract
Settlement Date at a price equal to the Stated Amount (the "PURCHASE PRICE"), a
number of shares of Common Stock equal to the Settlement Rate, unless, prior to
or on the Purchase Contract Settlement Date, there shall have occurred a
Termination Event with respect to the Security of which such Purchase Contract
is a part or an Early Settlement shall have occurred. The "SETTLEMENT RATE" is
equal to:

          (1) if the Applicable Market Value (as defined below) is greater than
     or equal to $______ (the "THRESHOLD APPRECIATION PRICE"), _____ shares of
     Common Stock per Purchase Contract;

          (2) if the Applicable Market Value is less than the Threshold
     Appreciation Price but greater than $______ (the "REFERENCE PRICE"), the
     number of shares of Common Stock per Purchase Contract having a value,
     based on the Applicable Market Value, equal to $25; and

          (3) if the Applicable Market Value is less than or equal to the
     Reference Price, _____ share of Common Stock per Purchase Contract,

in each case subject to adjustment as provided in the Purchase Contract
Agreement (and in each case rounded upward or downward to the nearest 1/10,000th
of a share).

     No fractional shares of Common Stock will be issued upon settlement of
Purchase Contracts, as provided in Section 5.09 of the Purchase Contract
Agreement.

     Each Purchase Contract evidenced hereby, which is settled either through
Early Settlement or Cash Settlement, shall obligate the Holder of the related
Stock Purchase Unit to purchase at the Purchase Price, and the Company to sell,
a number of shares of Common Stock equal to the Early Settlement Rate or
Settlement Rate, as applicable.

                                       A-6


     The "APPLICABLE MARKET VALUE" means the average of the Closing Price per
share of Common Stock on each of the 20 consecutive Trading Days ending on the
third Trading Day immediately preceding the Purchase Contract Settlement Date.

     The "CLOSING PRICE" per share of Common Stock on any date of determination
means:

          (1) the closing sale price as of the close of the principal trading
     session (or, if no closing price is reported, the last reported sale price)
     per share on the New York Stock Exchange, Inc. (the "NYSE") on such date;

          (2) if Common Stock is not listed for trading on the NYSE on any such
     date, the closing sale price per share as reported in the composite
     transactions for the principal United States securities exchange on which
     Common Stock is so listed;

          (3) if Common Stock is not so listed on a United States national or
     regional securities exchange, the closing sale price per share as reported
     by The Nasdaq National Market;

          (4) if Common Stock is not so reported, the last quoted bid price for
     Common Stock in the over-the-counter market as reported by the National
     Quotation Bureau or similar organization; or

          (5) if such bid price is not available, the average of the mid-point
     of the last bid and ask prices of Common Stock on such date from at least
     three nationally recognized independent investment banking firms retained
     for this purpose by the Company.

     A "TRADING DAY" means a day on which Common Stock (1) is not suspended from
trading on any national or regional securities exchange or association or
over-the-counter market at the close of business and (2) has traded at least
once on the national or regional securities exchange or association or
over-the-counter market that is the primary market for the trading of Common
Stock.

     In accordance with the terms of the Purchase Contract Agreement, the Holder
of this Stock Purchase Units Certificate may pay the Purchase Price for the
shares of Common Stock purchased pursuant to each Purchase Contract evidenced
hereby by effecting a Cash Settlement or an Early Settlement or from the
proceeds of the Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio or a Remarketing of the
related Pledged Preferred Securities. A Holder of Stock Purchase Units who does
not effect, on or prior to 11:00 a.m. (New York City time) on the fifth Business
Day immediately preceding the Purchase Contract Settlement Date (or in the event
a Tax Event Redemption has occurred, the Business Day prior to the Purchase
Contract Settlement Date), an effective Cash Settlement, or who does not effect
on or prior to 5:00 p.m. (New York City time) on the seventh Business Day prior
to the Purchase Contract Settlement Date an effective Early Settlement, shall
pay the

                                       A-7


Purchase Price for the shares of Common Stock to be delivered under the related
Purchase Contract from the proceeds of the sale of the related Pledged Preferred
Securities held by the Collateral Agent. Such sale will be made by the
Remarketing Agent pursuant to the terms of the Remarketing Agreement on the
third Business Day prior to the Purchase Contract Settlement Date. If, as
provided in the Purchase Contract Agreement, upon the occurrence of a Failed
Remarketing, the Collateral Agent, for the benefit of the Company, exercises its
rights as a secured creditor with respect to the Pledged Preferred Securities
related to this Stock Purchase Units certificate, any accrued and unpaid
distributions on such Pledged Preferred Securities will become payable by the
Company to the holder of this Stock Purchase Units Certificate in the manner
provided for in the Purchase Contract Agreement.

     The Company shall not be obligated to issue any shares of Common Stock in
respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment of the aggregate purchase price for
the shares of Common Stock to be purchased thereunder in the manner herein set
forth.

     Each Purchase Contract evidenced hereby and all obligations and rights of
the Company and the Holder thereunder shall terminate if a Termination Event
shall occur. Upon the occurrence of a Termination Event, the Company shall give
written notice to the Purchase Contract Agent and to the Holders, at their
addresses as they appear in the Security Register. Upon and after the occurrence
of a Termination Event, the Collateral Agent shall release the Pledged Preferred
Security or the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio forming a
part of each Stock Purchase Unit from the Pledge. A Stock Purchase Unit shall
thereafter represent the right to receive the Preferred Security or the
appropriate Applicable Ownership Interest of the Treasury Portfolio forming a
part of such Stock Purchase Unit in accordance with the terms of the Purchase
Contract Agreement and the Pledge Agreement.

     Under the terms of the Pledge Agreement, the Purchase Contract Agent will
be entitled to exercise the voting and any other consensual rights pertaining to
the Pledged Preferred Securities. Upon receipt of notice of any meeting at which
holders of Preferred Securities are entitled to vote or upon the solicitation of
consents, waivers or proxies of holders of Preferred Securities, the Purchase
Contract Agent shall, as soon as practicable thereafter, mail to the Stock
Purchase Units Holders a notice:

          (1) containing such information as is contained in the notice or
     solicitation;

          (2) stating that each Stock Purchase Unit Holder on the record date
     set by the Purchase Contract Agent therefor (which, to the extent possible,
     shall be the same date as the record date for determining the holders of
     Preferred Securities entitled to vote) shall be entitled to instruct the
     Purchase Contract Agent as to the exercise of the voting rights pertaining
     to the Preferred Securities constituting a part of such Holder's Stock
     Purchase Unit; and

                                       A-8


          (3) stating the manner in which such instructions may be given.

Upon the written request of the Stock Purchase Unit Holders on such record date,
the Purchase Contract Agent shall endeavor insofar as practicable to vote or
cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of Preferred Securities as to which any particular
voting instructions are received. In the absence of specific instructions from
the Holder of a Stock Purchase Unit, the Purchase Contract Agent shall abstain
from voting the Preferred Security evidenced by such Stock Purchase Unit.

     Upon the dissolution and liquidation of the Trust, an aggregate principal
amount of the [Subordinated] Notes constituting the assets of the Trust and
underlying the Preferred Securities equal to the aggregate liquidation amount of
the Pledged Preferred Securities shall be delivered to the Securities
Intermediary in exchange for the Pledged Preferred Securities. Thereafter, the
[Subordinated] Notes shall be held by the Securities Intermediary to secure the
obligations of each Holder of Stock Purchase Units to purchase shares of Common
Stock under the Purchase Contracts constituting a part of such Stock Purchase
Units.

     Notwithstanding the foregoing, in the event of a dissolution and
liquidation of the Trust, if a Liquidation Distribution is to be distributed in
lieu of the [Subordinated] Notes as provided for in the Declaration, an amount
equal to the Liquidation Distribution shall be deposited in the Collateral
Account in exchange for the Pledged Preferred Securities. Thereafter, pursuant
to the terms of the Pledge Agreement, the Collateral Agent shall cause the
Securities Intermediary to apply an amount equal to the Redemption Amount of
such Liquidation Distribution to purchase on behalf of the Holders of Stock
Purchase Units the Treasury Portfolio and promptly remit the remaining portion
of such Liquidation Distribution to the Purchase Contract Agent for payment to
the Holders of such Stock Purchase Units. The Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio will be substituted as Collateral for the Pledged Preferred Securities
and will be held by the Collateral Agent in accordance with the terms of the
Pledge Agreement to secure the obligation of each Holder of a Stock Purchase
Unit to purchase the Common Stock of the Company under the Purchase Contract
constituting a part of such Stock Purchase Unit.

     Following the dissolution and liquidation of the Trust, the Holders and the
Collateral Agent shall have such security interests, rights and obligations with
respect to the [Subordinated] Notes or the Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio, as the case may be, as the Holders and the Collateral Agent had in
respect of the Pledged Preferred Securities, any reference herein to the
Preferred Securities shall be deemed to be a reference to the [Subordinated]
Notes or the Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, as the case may be, and any
reference herein to the liquidation amount of the Preferred Securities shall be
deemed to be a reference to the principal amount of the [Subordinated] Notes or
the Applicable Ownership Interest (as specified in clause (A) of the definition
of such term) of the

                                       A-9


Treasury Portfolio, as the case may be.

     Upon the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, an amount equal to the Redemption Amount plus any
accumulated and unpaid distributions payable on the Tax Event Redemption Date
with respect to the Applicable Principal Amount shall be deposited in the
Collateral Account in exchange for the Pledged Preferred Securities. Thereafter,
pursuant to the terms of the Pledge Agreement, the Collateral Agent shall cause
the Securities Intermediary to apply an amount equal to the Redemption Amount of
such funds to purchase on behalf of the Holders of Stock Purchase Units, the
Treasury Portfolio and promptly (a) transfer the Applicable Ownership Interest
(as specified in clause (A) of the definition of such term) of the Treasury
Portfolio to the Collateral Account to secure the obligations of each Holder of
Stock Purchase Units to purchase shares of Common Stock under the Purchase
Contracts constituting a part of such Stock Purchase Units, (b) transfer the
Applicable Ownership Interest (as specified in clause (B) of the definition of
such term) of the Treasury Portfolio to the Purchase Contract Agent for the
benefit of the Holders of such Stock Purchase Units and (C) remit the remaining
portion of such funds to the Purchase Contract Agent for payment to the Holders
of such Stock Purchase Units.

     Following the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, the Holders of Stock Purchase Units and the Collateral
Agent shall have such security interest rights and obligations with respect to
the Applicable Ownership Interest (as specified in clause (A) of the definition
of such term) of the Treasury Portfolio as the Holder of Stock Purchase Units
and the Collateral Agent had in respect of the Preferred Securities or
[Subordinated] Notes, as the case may be, subject to the Pledge thereof as
provided in the Pledge Agreement and any reference herein to the Preferred
Securities shall be deemed to be a reference to such Treasury Portfolio.

     The Stock Purchase Certificates are issuable only in registered form and
only in denominations of a single Stock Purchase Unit and any integral multiple
thereof. The transfer of any Stock Purchase Units Certificate will be registered
and Stock Purchase Units Certificates may be exchanged as provided in the
Purchase Contract Agreement. The Security Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents
permitted by the Purchase Contract Agreement. No service charge shall be
required for any such registration of transfer or exchange, but the Company and
the Purchase Contract Agent may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith. A Holder who
elects to substitute a Treasury Security for Preferred Securities, thereby
creating Treasury Stock Purchase Units, shall be responsible for any fees or
expenses payable in connection therewith. Except as provided in the Purchase
Contract Agreement, for so long as the Purchase Contract underlying a Stock
Purchase Unit remains in effect, such Stock Purchase Unit shall not be separable
into its constituent parts, and the rights and obligations of the Holder of such
Stock Purchase Unit in respect of the Preferred Securities and Purchase Contract
constituting such Stock Purchase Unit may be transferred and exchanged only as a
Stock Purchase Unit.

                                      A-10


     The Holder of Stock Purchase Units may substitute for the Pledged Preferred
Securities securing such Holder's obligations under the related Purchase
Contracts Treasury Securities in an aggregate principal amount equal to the
aggregate liquidation amount of the Pledged Preferred Securities in accordance
with the terms of the Purchase Contract Agreement and the Pledge Agreement. From
and after such Collateral Substitution, each Security for which such Pledged
Treasury Securities secures the Holder's obligation under the Purchase Contract
shall be referred to as a "TREASURY STOCK PURCHASE UNIT". A Holder may make such
Collateral Substitution only in integral multiples of 40 Stock Purchase Units
for 40 Treasury Stock Purchase Units.

     A Holder of Treasury Stock Purchase Units may recreate Stock Purchase Units
by delivering to the Securities Intermediary Preferred Securities with an
aggregate liquidation amount equal to the aggregate principal amount at maturity
of the Pledged Treasury Securities in exchange for the release of such Pledged
Treasury Securities in accordance with the terms of the Purchase Contract
Agreement and the Pledge Agreement. A Holder may recreate Stock Purchase Units
only in integral multiples of 40 Treasury Stock Purchase Units for 40 Stock
Purchase Units.

     If a Tax Event Redemption has occurred, a Stock Purchase Unit Holder may
not create Treasury Stock Purchase Units, and a Treasury Stock Purchase Unit
Holder may not recreate a Stock Purchase Unit.

     The Company shall pay, on each Payment Date, the Purchase Contract Payments
payable in respect of each Purchase Contract to the Person in whose name the
Stock Purchase Units Certificate evidencing such Purchase Contract is registered
at the close of business on the Record Date for such Payment Date. Purchase
Contract Payments will be payable at the office of the Purchase Contract Agent
in New York City or, at the option of the Holder, by check mailed to the address
of the Person entitled thereto at such address as it appears on the Security
Register.

     The Company has the right to defer payment of all or part of the Purchase
Contract Payments in respect of each Purchase Contract until no later than the
Purchase Contract Settlement Date. If the Company so elects to defer Purchase
Contract Payments, the Company shall pay additional Purchase Contract Payments
on such deferred installments of Purchase Contract Payments at a rate equal to
___% per annum, compounding quarterly, until such deferred installments are
paid. In the event that the Company elects to defer the payment of Purchase
Contract Payments on the Purchase Contracts until the Purchase Contract
Settlement Date, each Holder will receive on the Purchase Contract Settlement
Date the aggregate amount of accrued and unpaid Purchase Contract Payments.

     The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Purchase Contract
Payments, shall immediately and automatically terminate, without the necessity
of any notice or action by any Holder, the Purchase Contract

                                      A-11


Agent or the Company, if, on or prior to the Purchase Contract Settlement Date,
a Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Purchase Contract Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Security
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Preferred Securities or the appropriate Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio, as the case may be, from the Pledge in accordance
with the provisions of the Pledge Agreement.

     Subject to and upon compliance with the provisions of the Purchase Contract
Agreement, at the option of the Holder thereof, Purchase Contracts underlying
Securities may be settled early ("EARLY SETTLEMENT") as provided in the Purchase
Contract Agreement. In order to exercise the right to effect Early Settlement
with respect to any Purchase Contracts evidenced by this Stock Purchase Units
Certificate, the Holder of this Stock Purchase Units Certificate shall deliver
to the Purchase Contract Agent at the Corporate Trust Office an Election to
Settle Early form set forth below and any other documents requested by the
Purchase Contract Agent duly completed and accompanied by payment in the form of
immediately available funds payable to the order of the Company in an amount
(the "EARLY SETTLEMENT AMOUNT") equal to (i) the product of (A) $25 times (B)
the number of Purchase Contracts with respect to which the Holder has elected to
effect Early Settlement, plus (ii) if such delivery is made with respect to any
Purchase Contracts during the period from the close of business on any Record
Date for any Payment Date to the opening of business on such Payment Date, an
amount equal to the Purchase Contract Payments payable on such Payment Date with
respect to such Purchase Contracts.

     Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Pledged Preferred Securities, Pledged [Subordinated] Notes or
the appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, as the case may be,
underlying such Securities shall be released from the Pledge as provided in the
Pledge Agreement and the Holder shall be entitled to receive a number of shares
of Common Stock on account of each Purchase Contract forming part of a Stock
Purchase Unit as to which Early Settlement is effected equal to ______ share of
Common Stock per Purchase Contract (the "EARLY SETTLEMENT RATE"). The Early
Settlement Rate shall be adjusted in the same manner and at the same time as the
Settlement Rate is adjusted as provided in the Purchase Contract Agreement.

     Upon registration of transfer of this Stock Purchase Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Purchase Contract Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Stock Purchase Units Certificate. The Company covenants and
agrees, and the Holder, by its acceptance hereof, likewise covenants and agrees,
to be bound by the provisions of this paragraph.

                                      A-12


     The Holder of this Stock Purchase Units Certificate, by its acceptance
hereof, authorizes the Purchase Contract Agent to enter into and perform the
related Purchase Contracts forming part of the Stock Purchase Units evidenced
hereby on its behalf as its attorney-in-fact, expressly withholds any consent to
the assumption (i.e., affirmance) of the Purchase Contracts by the Company or
its trustee in the event that the Company becomes the subject of a case under
the Bankruptcy Code, agrees to be bound by the terms and provisions thereof,
covenants and agrees to perform his obligations under such Purchase Contracts,
consents to the provisions of the Purchase Contract Agreement, authorizes the
Purchase Contract Agent to enter into and perform the Purchase Contract
Agreement and the Pledge Agreement on its behalf as its attorney-in-fact, and
consents to the Pledge of the Preferred Securities or the appropriate Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio, as the case may be, underlying this Stock Purchase
Units Certificate pursuant to the Pledge Agreement. The Holder further covenants
and agrees that, to the extent and in the manner provided in the Purchase
Contract Agreement and the Pledge Agreement, but subject to the terms thereof,
payments in respect to the aggregate liquidation amount of the Pledged Preferred
Securities or the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, as the
case may be, on the Purchase Contract Settlement Date shall be paid by the
Collateral Agent to the Company in satisfaction of such Holder's obligations
under such Purchase Contract and such Holder shall acquire no right, title or
interest in such payments.

     Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.

     The Purchase Contracts shall be governed by, and construed in accordance
with, the laws of the State of New York, without regard to conflicts of laws
principles thereof.

     The Company, the Purchase Contract Agent and its Affiliates and any agent
of the Company or the Purchase Contract Agent may treat the Person in whose name
this Stock Purchase Units Certificate is registered as the owner of the Stock
Purchase Units evidenced hereby for the purpose of receiving payments of
distributions payable quarterly on the Preferred Securities, receiving payments
of Purchase Contract Payments, performance of the Purchase Contracts and for all
other purposes whatsoever, whether or not any payments in respect thereof be
overdue and notwithstanding any notice to the contrary, and neither the Company,
the Purchase Contract Agent nor any such agent shall be affected by notice to
the contrary.

     The Purchase Contracts shall not, prior to the settlement thereof, entitle
the Holder to any of the rights of a holder of shares of Common Stock.

     A copy of the Purchase Contract Agreement is available for inspection at
the offices of the Purchase Contract Agent.

                                      A-13


                                  ABBREVIATIONS

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM:                   as tenants in common
UNIF GIFT MIN ACT:         ___________________ Custodian _____________________
                                 (cust)                        (minor)
                           Under Uniform Gifts to Minors Act of  __________
                           _____________________________________________________

TENANT:                    as tenants by the entireties

JT TEN:                    as joint tenants with right of survivorship and not
                           as tenants in common

Additional abbreviations may also be used though not in the above list.

                                   ----------

  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
                                      unto
________________________________________________________________________________
      (Please insert Social Security or Taxpayer I.D. or other Identifying
                               Number of Assignee)

________________________________________________________________________________
  (Please Print or Type Name and Address Including Postal Zip Code of Assignee)

the within Stock Purchase Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing attorney __________________, to transfer
said Stock Purchase Units Certificates on the books of Cinergy Corp., and CC
Funding Trust II with full power of substitution in the premises.

Dated:                                  Signature
      ------------------------------             -------------------------------

                                        NOTICE: The signature to this assignment
                                        must correspond with the name as it
                                        appears upon the face of the within
                                        Stock Purchase Units Certificates in
                                        every particular, without alteration or
                                        enlargement or any change whatsoever.

           Signature Guarantee:
                                -------------------------------------

                                      A-14


                             SETTLEMENT INSTRUCTIONS

     The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Stock Purchase Units
evidenced by this Stock Purchase Units Certificate be registered in the name of,
and delivered, together with a check in payment for any fractional share, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.


Dated:
      --------------------------------    --------------------------------------
                                          Signature
                                          Signature Guarantee:
                                                              ------------------
                                          (if assigned to another person)

If shares are to be registered in the
name of and delivered to a Person         REGISTERED HOLDER
other than the Holder, please (i)
print such Person's name and address
and (ii) provide a guarantee of your      Please print name and address of
signature:                                Registered Holder:

- --------------------------------------    --------------------------------------
Name                                      Name

- --------------------------------------    --------------------------------------
Address                                   Address
- --------------------------------------    --------------------------------------
- --------------------------------------    --------------------------------------
- --------------------------------------    --------------------------------------

Social Security or other
Taxpayer Identification
Number, if any                            --------------------------------------

                                      A-15


                            ELECTION TO SETTLE EARLY

     The undersigned Holder of this Stock Purchase Units Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Stock Purchase Units evidenced by this Stock
Purchase Units Certificate specified below. The undersigned Holder directs that
a certificate for shares of Common Stock deliverable upon such Early Settlement
be registered in the name of, and delivered, together with a check in payment
for any fractional share and any Stock Purchase Units Certificate representing
any Stock Purchase Units evidenced hereby as to which Early Settlement of the
related Purchase Contracts is not effected, to the undersigned at the address
indicated below unless a different name and address have been indicated below.
Pledged Preferred Securities, Pledged [Subordinated] Notes or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
deliverable upon such Early Settlement will be transferred in accordance with
the transfer instructions set forth below. If shares are to be registered in the
name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.

Dated:
       -------------------------------    --------------------------------------
                                          Signature

Signature Guarantee:
                     ---------------------

                                      A-16


     Number of Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:

If shares of Common Stock or Stock        REGISTERED HOLDER
Purchase Units Certificates are to be
registered in the name of and
delivered to and Pledged Preferred
Securities, Pledged [Subordinated]
Notes or the Applicable Ownership
Interest of the Treasury Portfolio, as
the case may be, are to be transferred
to a Person other than the Holder,
please print such Person's name and
address:

                                          Please print name and address of
                                          Registered Holder:


- --------------------------------------    --------------------------------------
Name                                      Name

- --------------------------------------    --------------------------------------
Address                                   Address
- --------------------------------------    --------------------------------------
- --------------------------------------    --------------------------------------
- --------------------------------------    --------------------------------------

Social Security or other
Taxpayer Identification

Number, if any                            --------------------------------------

                                      A-17


Transfer Instructions for Pledged Preferred Securities or the Applicable
Ownership Interest of the Treasury Portfolio, as the case may be, transferable
upon Early Settlement or a Termination Event:

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

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

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

                                      A-18


                     [TO BE ATTACHED TO GLOBAL CERTIFICATES]

            SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE


The following increases or decreases in this Global Certificate have been made:



                                                                          Number of Stock
                         Amount of increase in  Amount of decrease in     Purchase Units
                            Number of Stock        Number of Stock       evidenced by this
Date                        Purchase Units         Purchase Units       Global Certificate    Signature of authorized
                           evidenced by the       evidenced by the        following such      signatory of Trustee or
                          Global Certificate     Global Certificate    decrease or increase   Securities Custodian
                                                                                  
- --------------------------------------------------------------------------------------------------------------------

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

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

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

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                                                                       EXHIBIT B

                   FACE OF TREASURY STOCK PURCHASE CERTIFICATE

     [THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"),
OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR
CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS
CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.

     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

No. ____                                                  CUSIP No._____________
Number of Treasury Stock Purchase Units:___________

                                  CINERGY CORP.
                               CC FUNDING TRUST II
                          TREASURY STOCK PURCHASE UNITS

     This Treasury Stock Purchase Units Certificate certifies that
__________________ is the registered Holder of the number of Treasury Stock
Purchase Units set forth above. Each Treasury Stock Purchase Unit consists of
(i) a 1/40 undivided beneficial ownership interest of a Treasury Security having
a principal amount at maturity equal to $1,000, subject to the Pledge of such
Treasury Security by such Holder pursuant to the Pledge Agreement, and (ii) the
rights and obligations of the Holder under one Purchase Contract with Cinergy
Corp., a Delaware



corporation (the "COMPANY"). All capitalized terms used herein which are defined
in the Purchase Contract Agreement (as defined on the reverse hereof) have the
meaning set forth therein.

     Pursuant to the Pledge Agreement, the Treasury Securities constituting part
of each Treasury Stock Purchase Unit evidenced hereby have been pledged to the
Collateral Agent, for the benefit of the Company, to secure the obligations of
the Holder under the Purchase Contract comprising part of such Treasury Stock
Purchase Unit. Each Purchase Contract evidenced hereby obligates the Holder of
this Treasury Stock Purchase Units Certificate to purchase, and the Company, to
sell, on _____________ (the "PURCHASE CONTRACT SETTLEMENT DATE"), at a price
equal to $25 (the "STATED AMOUNT"), a number of shares of Common Stock, without
par value ("COMMON STOCK"), of the Company, equal to the Settlement Rate, unless
prior to or on the Purchase Contract Settlement Date there shall have occurred a
Termination Event or an Early Settlement with respect to the Treasury Stock
Purchase Unit of which such Purchase Contract is a part, all as provided in the
Purchase Contract Agreement and more fully described on the reverse hereof. The
purchase price (the "PURCHASE PRICE") for the shares of Common Stock purchased
pursuant to each Purchase Contract evidenced hereby, if not paid earlier, shall
be paid on the Purchase Contract Settlement Date by application of the proceeds
from the Treasury Securities at maturity pledged to secure the obligations of
the Holder under such Purchase Contract of the Treasury Stock Purchase Unit of
which such Purchase Contract is a part.

     The Company shall pay, on each Payment Date, in respect of each Purchase
Contract forming part of a Treasury Stock Purchase Unit evidenced hereby, an
amount (the "PURCHASE CONTRACT PAYMENTS") equal to ___% per year of the Stated
Amount. Such Purchase Contract Payments shall be payable to the Person in whose
name this Treasury Stock Purchase Units Certificate is registered at the close
of business on the Record Date for such Payment Date. The Company may, at its
option, defer such Purchase Contract Payments.

     Distributions on the Preferred Securities and the Applicable Ownership
Interest (as specified in clause (B) of the definition of such term) and the
Purchase Contract Payments will be payable at the office of the Purchase
Contract Agent in New York City or, at the option of the Company, by check
mailed to the address of the Person entitled thereto as such address appears on
the Security Register.

     Reference is hereby made to the further provisions 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
Purchase Contract Agent by manual signature, this Treasury Stock Purchase Units
Certificate shall not be entitled to any benefit under the Pledge Agreement or
the Purchase Contract Agreement or be valid or obligatory for any purpose.

                                       B-2


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

                                          CINERGY CORP.


                                          By:
                                              Name:
                                              Title:


                                          HOLDER SPECIFIED ABOVE (as to
                                          obligations of such Holder under the
                                          Purchase Contracts)


                                          By:[                             ],
                                              not individually but solely as
                                              Attorney-in-Fact of such Holder


                                          By:
                                             -----------------------------------
                                             Name:
                                             Title:

Dated:
      ---------------------

                                       B-3


                        CERTIFICATE OF AUTHENTICATION OF
                             PURCHASE CONTRACT AGENT

     This is one of the Treasury Stock Purchase Units referred to in the
within-mentioned Purchase Contract Agreement.

                                          By:[                              ],
                                              as Purchase Contract Agent


                                          By:
                                             -----------------------------------
                                              Authorized Signatory

Dated:
      -----------------

                                       B-4


             (REVERSE OF TREASURY STOCK PURCHASE UNITS CERTIFICATE)

     Each Purchase Contract evidenced hereby is governed by a Purchase Contract
Agreement, dated as of ___________, 2003 (as may be supplemented from time to
time, the "PURCHASE CONTRACT AGREEMENT") between the Company and [            ],
as Purchase Contract Agent (including its successors thereunder, herein called
the "PURCHASE CONTRACT AGENT"), to which the Purchase Contract Agreement and
supplemental agreements thereto reference is hereby made for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Purchase Contract Agent, the Company and the Holders and of
the terms upon which the Treasury Stock Purchase Units Certificates are, and are
to be, executed and delivered.

     Unless a Cash Settlement or an Early Settlement has occurred, each Purchase
Contract evidenced hereby obligates the Holder of this Treasury Stock Purchase
Units Certificate to purchase, and the Company to sell, on the Purchase Contract
Settlement Date at a price equal to the Stated Amount (the "PURCHASE PRICE") a
number of shares of Common Stock equal to the Settlement Rate, unless prior to
the Purchase Contract Settlement Date, there shall have occurred a Termination
Event with respect to the Security of which such Purchase Contract is a part or
an Early Settlement shall have occurred. The "SETTLEMENT RATE" is equal to:

          (1) if the Applicable Market Value (as defined below) is greater than
     or equal to $______ (the "THRESHOLD APPRECIATION PRICE"), ______ share of
     Common Stock per Purchase Contract;

          (2) if the Applicable Market Value is less than the Threshold
     Appreciation Price but greater than $______ (the "REFERENCE PRICE"), the
     number of shares of Common Stock per Purchase Contract having a value,
     based on the Applicable Market Value, equal to $25; and

          (3) if the Applicable Market Value is less than or equal to the
     Reference Price, then ______ share of Common Stock per Purchase Contract,

     in each case subject to adjustment as provided in the Purchase Contract
Agreement (and in each case rounded upward or downward to the nearest 1/10,000th
of a share).

     No fractional shares of Common Stock will be issued upon settlement of
Purchase Contracts, as provided in Section 5.09 of the Purchase Contract
Agreement.

     Each Purchase Contract evidenced hereby, which is settled either through
Early Settlement or Cash Settlement, shall obligate the Holder of the related
Treasury Stock Purchase Unit to purchase at the Purchase Price for cash, and the
Company to sell, a number of shares of Common Stock equal to the Early
Settlement Rate or the Settlement Rate, as applicable.

                                       B-5


     The "APPLICABLE MARKET VALUE" means the average of the Closing Prices per
share of Common Stock on each of the 20 consecutive Trading Days ending on the
third Trading Day immediately preceding the Purchase Contract Settlement Date.

     The "CLOSING PRICE" per share of Common Stock on any date of determination
means the:

          (1) closing sale price as of the close of the principal trading
     session (or, if no closing price is reported, the last reported sale price)
     per share on the New York Stock Exchange, Inc. (the "NYSE") on such date;

          (2) if the Common Stock is not listed for trading on the NYSE on any
     such date, the closing sale price per share as reported in the composite
     transactions for the principal United States securities exchange on which
     the Common Stock is so listed;

          (3) if the Common Stock is not so listed on a United States national
     or regional securities exchange, the closing sale price per share as
     reported by The Nasdaq National Market;

          (4) if the Common Stock is not so reported, the last quoted bid price
     for the Common Stock in the over-the-counter market as reported by the
     National Quotation Bureau or similar organization; or

          (5) if such bid price is not available, the average of the mid-point
     of the last bid and ask prices of the Common Stock on such date from at
     least three nationally recognized independent investment banking firms
     retained for this purpose by the Company.

     A "TRADING DAY" means a day on which the Common Stock (1) is not suspended
from trading on any national or regional securities exchange or association or
over-the-counter market at the close of business and (2) has traded at least
once on the national or regional securities exchange or association or
over-the-counter market that is the primary market for the trading of the Common
Stock.

     In accordance with the terms of the Purchase Contract Agreement, the Holder
of this Treasury Stock Purchase Unit shall pay the Purchase Price for the shares
of the Common Stock purchased pursuant to each Purchase Contract evidenced
hereby either by effecting a Cash Settlement or an Early Settlement of each such
Purchase Contract or by applying a principal amount of the Pledged Treasury
Securities underlying such Holder's Treasury Stock Purchase Unit equal to the
Stated Amount of such Purchase Contract to the purchase of the Common Stock. A
Holder of Treasury Stock Purchase Unit who does not effect, prior to or on 11:00
a.m. (New York City time) on the fifth Business Day immediately preceding the
Purchase Contract Settlement Date, an effective Cash Settlement, or who does not
effect on or prior to 5:00 p.m.

                                       B-6


(New York City time) on the seventh Business Day prior to the Purchase Contract
Settlement Date an effective Early Settlement, shall pay the Purchase Price for
the shares of Common Stock to be issued under the related Purchase Contract from
the proceeds of the Pledged Treasury Securities.

     The Company shall not be obligated to issue any shares of Common Stock in
respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment of the aggregate purchase price for
the shares of Common Stock to be purchased thereunder in the manner herein set
forth.

     Each Purchase Contract evidenced hereby and all obligations and rights of
the Company and the Holder thereunder shall terminate if a Termination Event
shall occur. Upon the occurrence of a Termination Event, the Company shall give
written notice to the Purchase Contract Agent and to the Holders, at their
addresses as they appear in the Security Register. Upon and after the occurrence
of a Termination Event, the Collateral Agent shall release the Pledged Treasury
Securities (as defined in the Pledge Agreement) forming a part of each Treasury
Stock Purchase Unit. A Treasury Stock Purchase Unit shall thereafter represent
the right to receive the interest in the Treasury Security forming a part of
such Treasury Stock Purchase Unit, in accordance with the terms of the Purchase
Contract Agreement and the Pledge Agreement.

     The Treasury Stock Purchase Units Certificates are issuable only in
registered form and only in denominations of a single Treasury Stock Purchase
and any integral multiple thereof. The transfer of any Treasury Stock Purchase
Certificate will be registered and Treasury Stock Purchase Certificates may be
exchanged as provided in the Purchase Contract Agreement. The Security Registrar
may require a Holder, among other things, to furnish appropriate endorsements
and transfer documents permitted by the Purchase Contract Agreement. No service
charge shall be required for any such registration of transfer or exchange, but
the Company and the Purchase Contract Agent may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. A Holder who elects to substitute Preferred Securities or
[Subordinated] Notes, for Treasury Securities, thereby recreating Stock Purchase
Units, shall be responsible for any fees or expenses associated therewith.
Except as provided in the Purchase Contract Agreement, for so long as the
Purchase Contract underlying a Treasury Stock Purchase Unit remains in effect,
such Treasury Stock Purchase Unit shall not be separable into its constituent
parts, and the rights and obligations of the Holder of such Treasury Stock
Purchase Unit in respect of the Treasury Security and the Purchase Contract
constituting such Treasury Stock Purchase Unit may be transferred and exchanged
only as a Treasury Stock Purchase Unit.

     A Holder of Treasury Stock Purchase Units may recreate Stock Purchase Units
by delivering to the Securities Intermediary Preferred Securities with an
aggregate liquidation amount, or [Subordinated] Notes with an aggregate
principal amount, equal to the aggregate principal amount at maturity of the
Pledged Treasury Securities in exchange for the release of

                                       B-7


such Pledged Treasury Securities in accordance with the terms of the Purchase
Contract Agreement and the Pledge Agreement. From and after such substitution,
the Holder's Security shall be referred to as a "STOCK PURCHASE UNIT". Any such
creation of Stock Purchase Units may be effected only in multiples of 40
Treasury Stock Purchase Units for 40 Stock Purchase Units.

     A Holder of Stock Purchase Units may recreate Treasury Stock Purchase Units
by delivering to the Securities Intermediary Treasury Securities in an aggregate
principal amount equal to the aggregate liquidation amount of the Pledged
Preferred Securities or the aggregate principal amount at maturity of the
Pledged [Subordinated] Notes, as the case may be, in accordance with the terms
of the Purchase Contract Agreement and the Pledge Agreement. Any such recreation
of Treasury Stock Purchase Units may be effected only in multiples of 40 Stock
Purchase Units for 40 Treasury Stock Purchase Units.

     If a Tax Event Redemption has occurred, a Treasury Stock Purchase Unit
Holder may not recreate Stock Purchase Units, and a Stock Purchase Unit Holder
may not create a Treasury Stock Purchase Unit.

     The Company shall pay, on each Payment Date, the Purchase Contract Payments
payable in respect of each Purchase Contract to the Person in whose name the
Treasury Stock Purchase Units Certificate evidencing such Purchase Contract is
registered at the close of business on the Record Date for such Payment Date.
Purchase Contract Payments will be payable at the office of the Purchase
Contract Agent in New York City or, at the option of the Holder, by check mailed
to the address of the Person entitled thereto at such address as it appears on
the Security Register.

     The Company has the right to defer payment of all or part of the Purchase
Contract Payments in respect of each Purchase Contract until no later than the
Purchase Contract Settlement Date. If the Company so elects to defer Purchase
Contract Payments, the Company shall pay additional Purchase Contract Payments
on such deferred installments of Purchase Contract Payments at a rate equal to
___% per annum, compounding quarterly, until such deferred installments are
paid. In the event that the Company elects to defer the payment of Purchase
Contract Payments on the Purchase Contracts until the Purchase Contract
Settlement Date), each Holder will receive on the Purchase Contract Settlement
Date the aggregate amount of accrued and unpaid Purchase Contract Payments.

     The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Purchase Contract
Payments, shall immediately and automatically terminate, without the necessity
of any notice or action by any Holder, the Purchase Contract Agent or the
Company, if, on or prior to the Purchase Contract Settlement Date, a Termination
Event shall have occurred. Upon the occurrence of a Termination Event, the
Company shall promptly but in no event later than two Business Days thereafter
give written notice to the Purchase Contract Agent, the Collateral Agent and the
Holders, at their addresses as they appear

                                       B-8


in the Security Register. Upon and after the occurrence of a Termination Event,
the Collateral Agent shall release the Treasury Securities from the Pledge in
accordance with the provisions of the Pledge Agreement. A Treasury Stock
Purchase Unit shall thereafter represent the right to receive the interest in
the Treasury Security forming a part of such Treasury Stock Purchase Unit, in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement.

     Subject to and upon compliance with the provisions of the Purchase Contract
Agreement, at the option of the Holder thereof, Purchase Contracts underlying
Securities may be settled early ("EARLY SETTLEMENT") as provided in the Purchase
Contract Agreement. In order to exercise the right to effect Early Settlement
with respect to any Purchase Contracts evidenced by this Stock Purchase Units
Certificate, the Holder of this Treasury Stock Purchase Units Certificate shall
deliver to the Purchase Contract Agent at the Corporate Trust Office an Election
to Settle Early form set forth below and any other documents requested by the
Purchase Contract Agent duly completed and accompanied by payment in the form of
immediately available funds payable to the order of the Company in an amount
(the "EARLY SETTLEMENT AMOUNT") equal to (i) the product of (A) $25 times (B)
the number of Purchase Contracts with respect to which the Holder has elected to
effect Early Settlement, plus (ii) if such delivery is made with respect to any
Purchase Contracts during the period from the close of business on any Record
Date for any Payment Date to the opening of business on such Payment Date, an
amount equal to the Purchase Contract Payments payable on such Payment Date with
respect to such Purchase Contracts.

     Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Pledged Treasury Securities underlying such Securities shall be
released from the Pledge as provided in the Pledge Agreement and the Holder
shall be entitled to receive a number of shares of Common Stock on account of
each Purchase Contract forming part of a Treasury Stock Purchase Unit as to
which Early Settlement is effected equal to ______ share of Common Stock per
Purchase Contract (the "EARLY SETTLEMENT RATE"). The Early Settlement Rate shall
be adjusted in the same manner and at the same time as the Settlement Rate is
adjusted as provided in the Purchase Contract Agreement.

     Upon registration of transfer of this Treasury Stock Purchase Certificate,
the transferee shall be bound (without the necessity of any other action on the
part of such transferee, except as may be required by the Purchase Contract
Agent pursuant to the Purchase Contract Agreement), under the terms of the
Purchase Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Treasury Stock Purchase Units Certificate. The Company
covenants and agrees, and the Holder, by its acceptance hereof, likewise
covenants and agrees, to be bound by the provisions of this paragraph.

     The Holder of this Treasury Stock Purchase Units Certificate, by its
acceptance hereof, authorizes the Purchase Contract Agent to enter into and
perform the related Purchase Contracts forming part of the Treasury Stock
Purchase Units evidenced hereby on its behalf as its attorney-in-fact, expressly
withholds any consent to the assumption (i.e., affirmance) of the

                                       B-9


Purchase Contracts by the Company or its trustee in the event that the Company
becomes the subject of a case under the Bankruptcy Code, agrees to be bound by
the terms and provisions thereof, covenants and agrees to perform its
obligations under such Purchase Contracts, consents to the provisions of the
Purchase Contract Agreement, authorizes the Purchase Contract Agent to enter
into and perform the Purchase Contract Agreement and the Pledge Agreement on its
behalf as its attorney-in-fact, and consents to the Pledge of the Treasury
Securities underlying this Treasury Stock Purchase Units Certificate pursuant to
the Pledge Agreement. The Holder further covenants and agrees, that, to the
extent and in the manner provided in the Purchase Contract Agreement and the
Pledge Agreement, but subject to the terms thereof, payments in respect to the
aggregate principal amount of the Pledged Treasury Securities on the Purchase
Contract Settlement Date shall be paid by the Collateral Agent to the Company in
satisfaction of such Holder's obligations under such Purchase Contract and such
Holder shall acquire no right, title or interest in such payments.

     Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.

     The Purchase Contracts shall for all purposes be governed by, and construed
in accordance with, the laws of the State of New York, without regard to
conflicts of laws principles thereof.

     The Company, the Purchase Contract Agent and its Affiliates and any agent
of the Company or the Purchase Contract Agent may treat the Person in whose name
this Treasury Stock Purchase Units Certificate is registered as the owner of the
Treasury Stock Purchase Units evidenced hereby for the purpose of receiving
payments of interest on the Treasury Securities, receiving payments of Purchase
Contract Payments, performance of the Purchase Contracts and for all other
purposes whatsoever, whether or not any payments in respect thereof be overdue
and notwithstanding any notice to the contrary, and neither the Company, the
Purchase Contract Agent nor any such agent shall be affected by notice to the
contrary.

     The Purchase Contracts shall not, prior to the settlement thereof, entitle
the Holder to any of the rights of a holder of shares of Common Stock.

     A copy of the Purchase Contract Agreement is available for inspection at
the offices of the Purchase Contract Agent.

                                      B-10


                                  ABBREVIATIONS

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM:                 as tenants in common

UNIF GIFT MIN ACT:       ___________________ Custodian ___________________
                               (cust)                        (minor)
                         Under Uniform Gifts to Minors Act of __________________
                         _______________________________________________________


TENANT:                  as tenants by the entireties

JT TEN:                  as joint tenants with right of survivorship and not as
                         tenants in common

Additional abbreviations may also be used though not in the above list.

  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
                                      unto

- --------------------------------------------------------------------------------
      (Please insert Social Security or Taxpayer I.D. or other Identifying
                               Number of Assignee)

- --------------------------------------------------------------------------------
  (Please Print or Type Name and Address Including Postal Zip Code of Assignee)

the within Treasury Stock Purchase Units Certificates and all rights thereunder,
hereby irrevocably constituting and appointing attorney to transfer said
Treasury Stock Purchase Units Certificates on the books of Cinergy Corp.., and
CC Funding Trust II with full power of substitution in the premises.

Dated:
      --------------------------------    --------------------------------------
                                          Signature

                                          NOTICE: The signature to this
                                          assignment must correspond with the
                                          name as it appears upon the face of
                                          the within Treasury Stock Purchase
                                          Units Certificates in every
                                          particular, without alteration or
                                          enlargement or any change whatsoever.

              Signature Guarantee:
                                   --------------------------------

                                      B-11


                             SETTLEMENT INSTRUCTIONS

     The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Treasury Stock Purchase
Units evidenced by this Treasury Stock Purchase Units Certificate be registered
in the name of, and delivered, together with a check in payment for any
fractional share, to the undersigned at the address indicated below unless a
different name and address have been indicated below. If shares are to be
registered in the name of a Person other than the undersigned, the undersigned
will pay any transfer tax payable incident thereto.

Dated:
      --------------------------------    --------------------------------------
                                          Signature
                                          Signature Guarantee:
                                                              ------------------
                                          (if assigned to another person)
If shares are to be registered in the
name of and delivered to a Person         REGISTERED HOLDER
other than the Holder, please (i)
print such Person's name and address
and (ii) provide a guarantee of your
signature:                                Please print name and address of
                                          Registered Holder:

- --------------------------------------    --------------------------------------
Name                                      Name

- --------------------------------------    --------------------------------------
Address                                   Address
- --------------------------------------    --------------------------------------
- --------------------------------------    --------------------------------------
- --------------------------------------    --------------------------------------

Social Security or other
Taxpayer Identification

Number, if any                            --------------------------------------

                                      B-12


                            ELECTION TO SETTLE EARLY

     The undersigned Holder of this Treasury Stock Purchase Units Certificate
hereby irrevocably exercises the option to effect Early Settlement in accordance
with the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Treasury Stock Purchase Units evidenced by
this Treasury Stock Purchase Units Certificate specified below. The option to
effect Early Settlement may be exercised only with respect to Purchase Contracts
underlying Treasury Stock Purchase Units with an aggregate Stated Amount equal
to $1,000 or an integral multiple thereof. The undersigned Holder directs that a
certificate for shares of Common Stock deliverable upon such Early Settlement be
registered in the name of, and delivered, together with a check in payment for
any fractional share and any Treasury Stock Purchase Units Certificate
representing any Treasury Stock Purchase Units evidenced hereby as to which
Early Settlement of the related Purchase Contracts is not effected, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. Pledged Treasury Securities deliverable upon such
Early Settlement will be transferred in accordance with the transfer
instructions set forth below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.

Dated:
      --------------------------------    --------------------------------------
                                          Signature


Signature Guarantee:
                    ----------------------

                                      B-13


     Number of Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:

If shares of Common Stock or Treasury     REGISTERED HOLDER
Stock Purchase Units Certificates are
to be registered in the name of and
delivered to and Pledged Treasury
Securities are to be transferred to a
Person other than the Holder, please
print such Person's name and address:

                                          Please print name and address of
                                          Registered Holder:


- --------------------------------------    --------------------------------------
Name                                      Name

- --------------------------------------    --------------------------------------
Address                                   Address
- --------------------------------------    --------------------------------------
- --------------------------------------    --------------------------------------
- --------------------------------------    --------------------------------------

Social Security or other
Taxpayer Identification

Number, if any                            --------------------------------------

                                      B-14


Transfer Instructions for Pledged Treasury Securities Transferable Upon or Early
Settlement or a Termination Event:

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

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

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

                                      B-15


                     [TO BE ATTACHED TO GLOBAL CERTIFICATES]

            SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE

The following increases or decreases in this Global Certificate have been made:



                                                                        Number of Treasury
                         Amount of increase in  Amount of decrease in  Stock Purchase Units
                          Number of Treasury     Number of Treasury      evidenced by this    Signature of authorized
Date                     Stock Purchase Units   Stock Purchase Units    Global Certificate    signatory of Trustee or
                           evidenced by the       evidenced by the        following such      Securities Custodian
                          Global Certificate     Global Certificate    decrease or increase
                                                                                  
- --------------------------------------------------------------------------------------------------------------------

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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


                                      B-16


                                                                       EXHIBIT C

                     INSTRUCTION TO PURCHASE CONTRACT AGENT

[                        ]
[                        ]
[                        ]
Attention: Corporate Trust Department

     Re: [_______ Stock Purchase Units] [_______ Treasury Stock Purchase Units]
of Cinergy Corp., a Delaware corporation (the "COMPANY") and CC Funding Trust
II.

     The undersigned Holder hereby notifies you that it has delivered to
[          ], as Securities Intermediary, for credit to the Collateral Account,
$______ aggregate [principal] [liquidation] amount of [Preferred Securities]
[[Subordinated] Notes] [Treasury Securities] in exchange for the [Pledged
Preferred Securities] [Pledged [Subordinated] Notes] [Pledged Treasury
Securities] held in the Collateral Account, in accordance with the Pledge
Agreement, dated as of ____________, 2003 (the "PLEDGE AGREEMENT"; unless
otherwise defined herein, terms defined in the Pledge Agreement are used herein
as defined therein), between you, the Company, the Collateral Agent and the
Securities Intermediary. The undersigned Holder has paid all applicable fees
relating to such exchange. The undersigned Holder hereby instructs you to
instruct the Collateral Agent to release to you on behalf of the undersigned
Holder the [Pledged Preferred Securities] [Pledged [Subordinated] Notes]
[Pledged Treasury Securities] related to such [Stock Purchase Units] [Treasury
Stock Purchase Units].

Date:
      --------------------------------    --------------------------------------
                                          Signature

                                  Signature Guarantee:
                                                      --------------------------



Please print name and address of Registered Holder:


                                          --------------------------------------
Name                                      Social Security or other Taxpayer
                                          Identification Number, if any

Address


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

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

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

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

                                       C-2


                                                                       EXHIBIT D

                       NOTICE FROM PURCHASE CONTRACT AGENT
                                   TO HOLDERS
         (Transfer of Collateral upon Occurrence of a Termination Event)

[HOLDER]


Attention:
Telecopy: __________

          Re:  [__________ Stock Purchase Units] [______ Treasury Stock Purchase
               Units] of Cinergy Corp., a Delaware corporation (the "COMPANY")
               and CC Funding Trust II

     Please refer to the Purchase Contract Agreement, dated as of __________,
2003 (the "PURCHASE CONTRACT AGREEMENT"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and the undersigned, as Purchase Contract Agent and as
attorney-in-fact for the holders of Stock Purchase Units and Treasury Stock
Purchase Units from time to time.

     We hereby notify you that a Termination Event has occurred and that [the
[Subordinated] Notes][the Treasury Securities] underlying your ownership
interest in _____ [Stock Purchase Units] [Treasury Stock Purchase Units] have
been released and are being held by us for your account pending receipt of
transfer instructions with respect to such [[Subordinated] Notes][Treasury
Securities] (the "RELEASED SECURITIES").

     Pursuant to Section 3.15 of the Purchase Contract Agreement, we hereby
request written transfer instructions with respect to the Released Securities.
Upon receipt of your instructions and upon transfer to us of your [Stock
Purchase Units][Treasury Stock Purchase Units] effected through book-entry or by
delivery to us of your [Stock Purchase Units Certificate][Treasury Stock
Purchase Units Certificate], we shall transfer the Released Securities by
book-entry transfer or other appropriate procedures, in accordance with your
instructions. In the event you fail to effect such transfer or delivery, the
Released Securities and any distributions thereon, shall be held in our name, or
a nominee in trust for your benefit, until such time as such [Stock Purchase
Units][Treasury Stock Purchase Units] are transferred or your [Stock Purchase
Units Certificate] [Treasury Stock Purchase Units Certificate] is surrendered or
satisfactory evidence is provided that such [Stock Purchase Units
Certificate][Treasury Stock Purchase Units Certificate] has been destroyed, lost
or stolen, together with any indemnification that we or the Company may require.



Date:                                 By:[                               ]

                                      ------------------------------------------
                                      Name:
                                      Title: Authorized Signatory

                                       D-2


                                                                       EXHIBIT E

                            NOTICE TO SETTLE BY CASH

[                        ]
[                        ]
[                        ]
Attention: Corporate Trust Department

          Re:  [_______ Stock Purchase Units] [Treasury Stock Purchase Units] of
               Cinergy Corp., a Delaware corporation (the "COMPANY") and CC
               Funding Trust II

     The undersigned Holder hereby irrevocably notifies you in accordance with
Section 5.02 of the Purchase Contract Agreement, dated as of ______________,
2003 (the "PURCHASE CONTRACT AGREEMENT"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and you, as Purchase Contract Agent and as Attorney-in-Fact
for the Holders of the Purchase Contracts, that such Holder has elected to pay
to the Securities Intermediary for deposit in the Collateral Account, prior to
or on 11:00 a.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date (in lawful money of the United
States by certified or cashiers' check or wire transfer, in immediately
available funds), $______ as the Purchase Price for the shares of Common Stock
issuable to such Holder by the Company under the related Purchase Contracts on
the Purchase Contract Settlement Date. The undersigned Holder hereby instructs
you to notify promptly the Collateral Agent of the undersigned Holders' election
to make such cash settlement with respect to the Purchase Contracts related to
such Holder's [Stock Purchase Units] [Treasury Stock Purchase Units].

Date:
      --------------------------------    --------------------------------------
                                          Signature


                                          Signature Guarantee:
                                                              ------------------


Please print name and address of Registered Holder:

                                       E-1


                                                                       EXHIBIT F

                       NOTICE FROM PURCHASE CONTRACT AGENT
                    TO COLLATERAL AGENT AND PROPERTY TRUSTEE
              (Settlement of Purchase Contract through Remarketing)

[                        ]
[                        ]
[                        ]
[                        ]
[                        ]
Attention:
Telecopy:

[                        ]
[                        ]
[                        ]
Attention:
Telecopy:

          Re:  __________ Stock Purchase Units of Cinergy Corp.., a Delaware
               corporation (the "COMPANY") and CC Funding Trust II

     Please refer to the Purchase Contract Agreement, dated as of _________,
2003 (the "PURCHASE CONTRACT AGREEMENT"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and the undersigned, as Purchase Contract Agent and as
attorney-in-fact for the Holders of Stock Purchase Units from time to time.

     In accordance with Section 5.02 of the Purchase Contract Agreement and,
based on instructions and Cash Settlements received from Holders of Stock
Purchase Units as of 11:00 a.m. (New York City time), the fifth Business Day
preceding the Purchase Contract Settlement Date, we hereby notify you that
______ [Preferred Securities] [[Subordinated] Notes] are to be tendered for
purchase in the Remarketing.

Date:                                 By: [                         ]


                                      ------------------------------------------
                                      Name:
                                      Title: Authorized Signatory

                                       F-1

EX-4.10

                                                                    EXHIBIT 4.10

                                  CINERGY CORP.

                                       and

                [                          ], as Collateral Agent

                                       and

            [                          ], as Securities Intermediary

                                       and

            [                          ], as Purchase Contract Agent


                                PLEDGE AGREEMENT


                           Dated as of _________, 2003



                                TABLE OF CONTENTS



                                                                                             PAGE
                                                                                             ----
                                                                                            
                                    ARTICLE 1
                                   DEFINITIONS

SECTION 1.01.  DEFINITIONS......................................................................2

                                    ARTICLE 2
                                     PLEDGE

SECTION 2.01.  PLEDGE...........................................................................6
SECTION 2.02.  CONTROL; FINANCING STATEMENT.....................................................6
SECTION 2.03.  TERMINATION......................................................................7

                                    ARTICLE 3
                       DISTRIBUTIONS ON PLEDGED COLLATERAL

SECTION 3.01.  INCOME DISTRIBUTIONS.............................................................7
SECTION 3.02.  PRINCIPAL PAYMENTS FOLLOWING TERMINATION EVENT...................................7
SECTION 3.03.  PRINCIPAL PAYMENTS PRIOR TO OR ON PURCHASE CONTRACT SETTLEMENT DATE..............7
SECTION 3.04.  PAYMENTS TO PURCHASE CONTRACT AGENT..............................................8
SECTION 3.05.  ASSETS NOT PROPERLY RELEASED.....................................................8

                                    ARTICLE 4
                                     CONTROL

SECTION 4.01.  ESTABLISHMENT OF COLLATERAL ACCOUNT..............................................9
SECTION 4.02.  TREATMENT AS FINANCIAL ASSETS....................................................9
SECTION 4.03.  SOLE CONTROL BY COLLATERAL AGENT.................................................9
SECTION 4.04.  SECURITIES INTERMEDIARY'S LOCATION..............................................10
SECTION 4.05.  NO OTHER CLAIMS.................................................................10
SECTION 4.06.  INVESTMENT AND RELEASE..........................................................10
SECTION 4.07.  STATEMENTS AND CONFIRMATIONS....................................................10
SECTION 4.08.  TAX ALLOCATIONS.................................................................10
SECTION 4.09.  NO OTHER AGREEMENTS.............................................................10
SECTION 4.10.  POWERS COUPLED WITH AN INTEREST.................................................11


                                        i




                                                                                             PAGE
                                                                                             ----
                                                                                            
                                    ARTICLE 5
       INITIAL DEPOSIT; ESTABLISHMENT OF TREASURY STOCK PURCHASE UNITS AND
                     REESTABLISHMENT OF STOCK PURCHASE UNITS

SECTION 5.01.  INITIAL DEPOSIT OF PREFERRED SECURITIES.........................................11
SECTION 5.02.  ESTABLISHMENT OF TREASURY STOCK PURCHASE UNITS..................................11
SECTION 5.03.  REESTABLISHMENT OF STOCK PURCHASE UNITS.........................................13
SECTION 5.04.  TERMINATION EVENT...............................................................15
SECTION 5.05.  CASH SETTLEMENT.................................................................16
SECTION 5.06.  EARLY SETTLEMENT................................................................18
SECTION 5.07.  APPLICATION OF PROCEEDS IN SETTLEMENT OF PURCHASE CONTRACTS.....................19
SECTION 5.08.  TAX EVENT REDEMPTION............................................................20

                                    ARTICLE 6
            VOTING RIGHTS - PLEDGED PREFERRED SECURITIES AND PLEDGED
                              [SUBORDINATED] NOTES

SECTION 6.01.  VOTING RIGHTS...................................................................21

                                    ARTICLE 7
                               RIGHTS AND REMEDIES

SECTION 7.01.  RIGHTS AND REMEDIES OF THE COLLATERAL AGENT.....................................22
SECTION 7.02.  SUBSTITUTION OF [SUBORDINATED] NOTES OR TREASURY PORTFOLIO......................23
SECTION 7.03.  TAX EVENT REDEMPTION............................................................24
SECTION 7.04.  SUBSTITUTIONS...................................................................24

                                    ARTICLE 8
                    REPRESENTATIONS AND WARRANTIES; COVENANTS

SECTION 8.01.  REPRESENTATIONS AND WARRANTIES..................................................24
SECTION 8.02.  COVENANTS.......................................................................25


                                       ii




                                                                                             PAGE
                                                                                             ----
                                                                                            
                                    ARTICLE 9
              THE COLLATERAL AGENT AND THE SECURITIES INTERMEDIARY

SECTION 9.01.  APPOINTMENT, POWERS AND IMMUNITIES..............................................26
SECTION 9.02.  INSTRUCTIONS OF THE COMPANY.....................................................27
SECTION 9.03.  RELIANCE BY COLLATERAL AGENT AND SECURITIES INTERMEDIARY........................27
SECTION 9.04.  RIGHTS IN OTHER CAPACITIES......................................................27
SECTION 9.05.  NON-RELIANCE ON COLLATERAL AGENT AND SECURITIES INTERMEDIARY....................28
SECTION 9.06.  COMPENSATION AND INDEMNITY......................................................28
SECTION 9.07.  FAILURE TO ACT..................................................................29
SECTION 9.08.  RESIGNATION OF COLLATERAL AGENT AND SECURITIES INTERMEDIARY.....................29
SECTION 9.09.  RIGHT TO APPOINT AGENT OR ADVISOR...............................................31
SECTION 9.10.  SURVIVAL........................................................................31
SECTION 9.11.  EXCULPATION.....................................................................32

                                   ARTICLE 10
                                    AMENDMENT

SECTION 10.01. AMENDMENT WITHOUT CONSENT OF HOLDERS............................................32
SECTION 10.02. AMENDMENT WITH CONSENT OF HOLDERS...............................................32
SECTION 10.03. EXECUTION OF AMENDMENTS.........................................................33
SECTION 10.04. EFFECT OF AMENDMENTS............................................................33
SECTION 10.05. REFERENCE OF AMENDMENTS.........................................................34

                                  ARTICLE 11
                                 MISCELLANEOUS

SECTION 11.01. NO WAIVER.......................................................................34
SECTION 11.02. GOVERNING LAW...................................................................34
SECTION 11.03. NOTICES.........................................................................35
SECTION 11.04. SUCCESSORS AND ASSIGNS..........................................................35
SECTION 11.05. COUNTERPARTS....................................................................35
SECTION 11.06. SEVERABILITY....................................................................35
SECTION 11.07. EXPENSES, ETC...................................................................35
SECTION 11.08. SECURITY INTEREST ABSOLUTE......................................................36
SECTION 11.09. NOTICE OF TAX EVENT, TAX EVENT REDEMPTION AND TERMINATION EVENT.................36


                                       iii


Exhibit A -    Instruction from Purchase Contract Agent to Collateral Agent
                 (Establishment of Treasury Stock Purchase Units)
Exhibit B -    Instruction from Collateral Agent to Securities Intermediary
                 (Establishment of Treasury Stock Purchase Units)
Exhibit C -    Instruction from Purchase Contract Agent to Collateral Agent
                 (Reestablishment of Stock Purchase Units)
Exhibit D -    Instruction from Collateral Agent to Securities Intermediary
                 (Reestablishment of Stock Purchase Units)
Exhibit E -    Notice of Cash Settlement from Securities Intermediary to
                 Purchase Contract Agent (Cash Settlement Amounts)

                                       iv


                                PLEDGE AGREEMENT

          PLEDGE AGREEMENT, dated as of _____________, 2003, among CINERGY
CORP., a Delaware corporation (the "COMPANY"), [              ], a _________
banking association, as collateral agent (in such capacity, together with its
successors in such capacity, the "COLLATERAL AGENT"), [               ],
a ___________ banking association, as securities intermediary with respect to
the Collateral Account (in such capacity, together with its successors in such
capacity, the "SECURITIES INTERMEDIARY"), and [                   ],
an _________ banking corporation, as purchase contract agent and as
attorney-in-fact of the Holders from time to time of the Securities under the
Purchase Contract Agreement (in such capacity, together with its successors in
such capacity, the "PURCHASE CONTRACT AGENT").

                                    RECITALS

          The Company and the Purchase Contract Agent are parties to the
Purchase Contract Agreement dated as of the date hereof (as modified and
supplemented and in effect from time to time, the "PURCHASE CONTRACT
AGREEMENT"), pursuant to which there may be issued up to _______________________
Stock Purchase Units (the "SECURITIES").

          Each Stock Purchase Unit, at issuance, consists of a unit comprised of
(a) a stock purchase contract (the "PURCHASE CONTRACT") under which the Holder
will purchase from the Company on the Purchase Contract Settlement Date, for an
amount equal to $[ ] (the "STATED AMOUNT"), a number of shares of Cinergy Corp.
common stock, without par value ("COMMON STOCK"), equal to the Settlement Rate,
and (b) beneficial ownership of a Preferred Security (a "PREFERRED SECURITY")
issued by CC Funding Trust II (the "TRUST"), having a liquidation amount equal
to the Stated Amount and maturing on __________, 20__.

          Pursuant to the terms of the Purchase Contract Agreement and the
Purchase Contracts, the Holders of the Securities have irrevocably authorized
the Purchase Contract Agent, as attorney-in-fact of such Holders, among other
things, to execute and deliver this Agreement on behalf of such Holders and to
grant the pledge provided herein of the Collateral Account to secure the
Obligations.

          Accordingly, the Company, the Collateral Agent, the Securities
Intermediary and the Purchase Contract Agent, on its own behalf and as
attorney-in-fact of the Holders from time to time of the Securities, agree as
follows:



                                    ARTICLE 1
                                   DEFINITIONS

          SECTION 1.01. DEFINITIONS. For all purposes of this Agreement, except
as otherwise expressly provided or unless the context otherwise requires:

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

          (b)  the words "HEREIN," "HEREOF" and "HEREUNDER" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section, Exhibit or other subdivision;

          (c)  the following terms which are defined in the UCC shall have the
meanings set forth therein: "CERTIFICATED SECURITY," "CONTROL," "FINANCIAL
ASSET," "ENTITLEMENT ORDER," "SECURITIES ACCOUNT" and "SECURITY ENTITLEMENT";

          (d)  the following terms have the meanings assigned to them in the
Purchase Contract Agreement: "ACT," "BANKRUPTCY CODE," "BOARD RESOLUTION,"
"BUSINESS DAY," "CASH SETTLEMENT," "CERTIFICATE," "EARLY SETTLEMENT," "EARLY
SETTLEMENT AMOUNT," "EARLY SETTLEMENT DATE," "HOLDER," "OFFICERS' CERTIFICATE,"
"OPINION OF COUNSEL," "OUTSTANDING SECURITIES," "PURCHASE CONTRACT," "PURCHASE
CONTRACT SETTLEMENT DATE," "PURCHASE PRICE," "REMARKETING AGENT," "REMARKETING
AGREEMENT," "SETTLEMENT RATE," "STOCK PURCHASE UNIT," "[SUBORDINATED] NOTES,"
"TERMINATION EVENT," "TREASURY STOCK PURCHASE UNIT," and "UNDERWRITING
AGREEMENT";

          (e)  the following terms have the meanings assigned to them in the
Amended and Restated Declaration of Trust of CC Funding Trust II, of even date
herewith (the "DECLARATION"): "APPLICABLE OWNERSHIP INTEREST," "APPLICABLE
PRINCIPAL AMOUNT," "FAILED REMARKETING," "INDENTURE," "INDENTURE TRUSTEE,"
"LIQUIDATION DISTRIBUTION," "PRIMARY TREASURY DEALER," "PROPERTY TRUSTEE,"
"QUOTATION AGENT," "REDEMPTION AMOUNT," "REDEMPTION PRICE," "TAX EVENT," "TAX
EVENT REDEMPTION," "TAX EVENT REDEMPTION DATE," and "TREASURY PORTFOLIO"; and

          (f)  the following terms have the meanings given to them in this
Section 1.01(f):

          "AGREEMENT" means this Pledge Agreement, as the same may be amended,
modified or supplemented from time to time.

          "CASH" means any coin or currency of the United States as at the time
shall be legal tender for payment of public and private debts.

                                        2


          "COLLATERAL ACCOUNT" means the collective reference to:

                 (i)   the securities account of [              ], as
          Collateral Agent, maintained by the Securities Intermediary and
          designated "[               ], as Collateral Agent of Cinergy Corp.,
          as pledgee of [             ], as the Purchase Contract Agent on
          behalf of and as attorney-in-fact for the Holders";

                (ii)   all investment property and other financial assets from
          time to time credited to the Collateral Account, including, without
          limitation, (A) the Preferred Securities and security entitlements
          relating thereto which are a component of the Stock Purchase Units
          from time to time, (B) the Applicable Ownership Interests (as
          specified in Clause (A) of the definition of such term) of the Holders
          with respect to the Treasury Portfolio which are a component of the
          Stock Purchase Units from time to time; (C) the [Subordinated] Notes
          and security entitlements relating thereto which are a component of
          the Stock Purchase Units from time to time, (D) any Treasury
          Securities and security entitlements relating thereto delivered from
          time to time upon establishment of Treasury Stock Purchase Units in
          accordance with Section 5.02 hereof and (E) payments made by Holders
          pursuant to Section 5.05 hereof;

               (iii)   all Proceeds of any of the foregoing (whether such
          Proceeds arise before or after the commencement of any proceeding
          under any applicable bankruptcy, insolvency or other similar law, by
          or against the pledgor or with respect to the pledgor); and

                (iv)   all powers and rights now owned or hereafter acquired
          under or with respect to the Collateral Account

          ((ii), (iii) and (iv), being collectively referred to as the
          "COLLATERAL").

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

          "OBLIGATIONS" means, with respect to each Holder, the collective
reference to all obligations and liabilities of such Holder under such Holder's
Purchase Contract, the Purchase Contract Agreement, and this Agreement or any
other document made, delivered or given in connection herewith or therewith, in
each case whether on account of principal, interest (including, without
limitation, interest accruing before and after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to such Holder, whether or not a claim for post-filing or
post-petition interest is

                                        3


allowed in such proceeding), fees, indemnities, costs, expenses or otherwise
(including, without limitation, all fees and disbursements of counsel to the
Company or the Collateral Agent or the Securities Intermediary that are required
to be paid by the Holder pursuant to the terms of any of the foregoing
agreements).

          "PERMITTED INVESTMENTS" means any one of the following which shall
mature not later than the next succeeding Business Day:

               (1)     any evidence of indebtedness with an original maturity of
          365 days or less issued, or directly and fully guaranteed or insured,
          by the United States of America or any agency or instrumentality
          thereof (provided that the full faith and credit of the United States
          of America is pledged in support of the timely payment thereof or such
          indebtedness constitutes a general obligation of it);

               (2)     deposits, certificates of deposit or acceptances with an
          original maturity of 365 days or less of any institution which is a
          member of the Federal Reserve System having combined capital and
          surplus and undivided profits of not less than $200.0 million at the
          time of deposit (and which may include the Collateral Agent);

               (3)     investments with an original maturity of 365 days or less
          of any Person that is fully and unconditionally guaranteed by a bank
          referred to in clause (2);

               (4)     repurchase agreements and reverse repurchase agreements
          relating to marketable direct obligations issued or unconditionally
          guaranteed by the United States Government or issued by any agency
          thereof and backed as to timely payment by the full faith and credit
          of the United States Government;

               (5)     investments in commercial paper, other than commercial
          paper issued by the Company or its affiliates, of any corporation
          incorporated under the laws of the United States or any State thereof,
          which commercial paper has a rating at the time of purchase at least
          equal to "A-1" by Standard & Poor's Ratings Services ("S&P") or at
          least equal to "P-1" by Moody's Investors Service, Inc. ("MOODY'S");
          and

               (6)     investments in money market funds (including, but not
          limited to, money market funds managed by the Collateral Agent or an
          affiliate of the Collateral Agent) registered under the Investment
          Company Act of 1940, as amended, rated in the highest applicable
          rating category by S&P or Moody's.

                                        4


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

          "PLEDGE" means the lien and security interest created by this
Agreement.

          "PLEDGED PREFERRED SECURITIES" means the Preferred Securities and
security entitlements with respect thereto from time to time credited to the
Collateral Account and not then released from the Pledge.

          "PLEDGED [SUBORDINATED] NOTES" means [Subordinated] Notes and security
entitlements with respect thereto from time to time credited to the Collateral
Account and not then released from the Pledge.

          "PLEDGED TREASURY SECURITIES" means Treasury Securities and security
entitlements with respect thereto from time to time credited to the Collateral
Account and not then released from the Pledge.

          "PROCEEDS" has the meaning ascribed thereto in the UCC and includes,
without limitation, all interest, dividends, cash, instruments, securities,
financial assets (as defined in Section8-102(a)(9) of the UCC) and other
property received, receivable or otherwise distributed upon the sale, exchange,
collection or disposition of any financial assets from time to time held in the
Collateral Account.

          "PURCHASE CONTRACT AGENT" has the meaning specified in the paragraph
preceding the recitals of this Agreement.

          "TRADES" means the Treasury/Reserve Automated Debt Entry System
maintained by the Federal Reserve Bank of New York pursuant to the TRADES
Regulations.

          "TRADES REGULATIONS" means the regulations of the United States
Department of the Treasury, published at 31 C.F.R. Part 357, an amended from
time to time. Unless otherwise defined herein, all terms defined in the TRADES
Regulations are used herein as therein defined.

                                        5


          "TRANSFER" means in the case of certificated securities in registered
form, delivery as provided in Section8-301(a) of the UCC, indorsed to the
transferee or in blank by an effective endorsement; in the case of Treasury
Securities, registration of the transferee as the owner of such Treasury
Securities on TRADES; and in the case of security entitlements, including,
without limitation, security entitlements with respect to Treasury Securities, a
securities intermediary indicating by book entry that such security entitlement
has been credited to the transferee's securities account.

          "TREASURY SECURITIES" means zero-coupon U.S. treasury securities
(CUSIP No. ___________) which mature on __________.

          "UCC" means the Uniform Commercial Code as in effect in the State of
New York from time to time.

          "VALUE" means, with respect to any item of Collateral on any date, as
to (1) Cash, the face amount thereof and (2) Treasury Securities or
[Subordinated] Notes, the aggregate principal amount thereof at maturity and (3)
the Preferred Securities, the liquidation amount thereof.

                                    ARTICLE 2
                                     PLEDGE

          SECTION 2.01. PLEDGE. Each Holder, acting through the Purchase
Contract Agent as such Holder's attorney-in-fact, hereby pledges and grants to
the Collateral Agent, as agent of and for the benefit of the Company, a
continuing first priority security interest in and to, and a lien upon and right
of set-off against, all of such Holder's right, title and interest in and to the
Collateral Account to secure the prompt and complete payment and performance
when due (whether at stated maturity, by acceleration or otherwise) of the
Obligations. The Collateral Agent shall have all of the rights, remedies and
recourses with respect to the Collateral afforded a secured party by the UCC, in
addition to, and not in limitation of, the other rights, remedies and recourses
afforded to the Collateral Agent by this Agreement.

          SECTION 2.02. CONTROL; FINANCING STATEMENT.

          (a)  The Collateral Agent shall have control of the Collateral Account
pursuant to the provisions of Article 4 of this Agreement.

          (b)  Subsequent to the date of initial issuance of the Securities, the
Purchase Contract Agent shall deliver to the Collateral Agent a financing
statement prepared by the Company for filing in the Office of the Secretary of
State of the State of New York and any other jurisdictions which the Company

                                        6


deems necessary, signed by the Purchase Contract Agent, as attorney-in-fact for
the Holders, as Debtors, and describing the Collateral.

          SECTION 2.03. TERMINATION. As to each Holder, this Agreement and the
Pledge created hereby shall terminate upon the satisfaction of such Holder's
Obligations. Upon such termination, the Securities Intermediary shall Transfer
such Holder's portion of the Collateral to the Purchase Contract Agent for
distribution to such Holder in accordance with his interest, free and clear of
any lien, pledge or security interest created hereby.

                                    ARTICLE 3
                       DISTRIBUTIONS ON PLEDGED COLLATERAL

          SECTION 3.01. INCOME DISTRIBUTIONS. All income distributions received
by the Securities Intermediary on account of the Preferred Securities, the
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio, the [Subordinated] Notes or Permitted
Investments from time to time held in the Collateral Account shall be
distributed to the Purchase Contract Agent (ABA No. [    ], GLA No. [      ],
A/C No. [   ], Re: Cinergy Corp.) for the benefit of the applicable Holders as
provided in the Purchase Contracts or Purchase Contract Agreement.

          SECTION 3.02. PRINCIPAL PAYMENTS FOLLOWING TERMINATION EVENT. All
payments received by the Securities Intermediary following a Termination Event
of (1) the liquidation amount of Pledged Preferred Securities or securities
entitlements thereto, or (2) the Applicable Ownership Interests (as specified in
Clause (A) of the definition thereof) of the Treasury Portfolio, (3) the
aggregate principal amount of the Pledged [Subordinated] Notes or securities
entitlements thereto, or (4) the principal amount of the Pledged Treasury
Securities, shall be distributed to the Purchase Contract Agent for the benefit
of the applicable Holders for distribution to such Holders in accordance with
their respective interests.

          SECTION 3.03. PRINCIPAL PAYMENTS PRIOR TO OR ON PURCHASE CONTRACT
SETTLEMENT DATE.

          (a)  Subject to the provisions of Section 5.08 and Section 7.02, and
except as provided in clause 3.03(b) below, if no Termination Event shall have
occurred, all payments received by the Securities Intermediary of (1) the
liquidation amount with respect to the Pledged Preferred Securities or security
entitlements with respect thereto, (2) the principal amount of Applicable
Ownership Interests (as specified in Clause (A) of the definition thereof) of
the Treasury Portfolio, (3) the aggregate principal amount with respect to the
Pledged [Subordinated] Notes or security entitlements with respect thereto or
(4) the

                                        7


principal amount of Pledged Treasury Securities, shall be held and invested in
Permitted Investments until the Purchase Contract Settlement Date and on the
Purchase Contract Settlement Date distributed to the Company as provided in
Section 5.07 hereof. Any balance remaining in the Collateral Account shall be
distributed to the Purchase Contract Agent for the benefit of the applicable
Holders for distribution to such Holders in accordance with their respective
interests. Upon the request of the Securities Intermediary, the Company shall
instruct the Securities Intermediary as to the type of Permitted Investments in
which any payments made under this Section shall be invested, provided, however,
that if the Company fails to deliver such instructions by 10:30 a.m. (New York
City time), the Securities Intermediary shall invest such payments in the
Permitted Investments described in clause (6) of the definition of Permitted
Investments.

          (b)  All payments received by the Securities Intermediary of (1) the
liquidation amount of Preferred Securities or security entitlements with respect
thereto, (2) Applicable Ownership interests (as specified in Clause (A) of the
definition thereof) of the Treasury Portfolio, (3) the aggregate principal
amount with respect to the [Subordinated] Notes or security entitlements with
respect thereto or (4) the principal amount of Treasury Securities or security
entitlements with respect thereto, that, in each case, have been released from
the Pledge shall be distributed to the Purchase Contract Agent for the benefit
of the applicable Holders for distribution to such Holders in accordance with
their respective interests.

          SECTION 3.04. PAYMENTS TO PURCHASE CONTRACT AGENT. The Securities
Intermediary shall use all commercially reasonable efforts to deliver payments
to the Purchase Contract Agent hereunder to the account designated by the
Purchase Contract Agent for such purpose not later than 12:00 p.m. (New York
City time) on the Business Day such payment is received by the Securities
Intermediary; provided, however, that if such payment is received on a day that
is not a Business Day or after 11:00 a.m. (New York City time) on a Business
Day, then the Securities Intermediary shall use all commercially reasonable
efforts to deliver such payment no later than 10:30 a.m. (New York City time) on
the next succeeding Business Day.

          SECTION 3.05. ASSETS NOT PROPERLY RELEASED. If the Purchase Contract
Agent or any Holder shall receive any principal payments on account of financial
assets credited to the Collateral Account and not released therefrom in
accordance with this Agreement, the Purchase Contract Agent or such Holder shall
hold the same as trustee of an express trust for the benefit of the Company and,
upon receipt of an Officers' Certificate of the Company so directing, promptly
deliver the same to the Securities Intermediary for credit to the Collateral
Account or to the Company for application to the Obligations of the Holders, and
the Purchase

                                        8


Contract Agent and Holders shall acquire no right, title or interest in any such
payments of principal amounts so received.

                                    ARTICLE 4
                                     CONTROL

          SECTION 4.01. ESTABLISHMENT OF COLLATERAL ACCOUNT. The Securities
Intermediary hereby confirms that:

          (a)  the Securities Intermediary has established the Collateral
Account;

          (b)  the Collateral Account is a securities account;

          (c)  subject to the terms of this Agreement, the Securities
Intermediary shall identify in its records the Purchase Contract Agent as the
entitlement holder entitled to exercise the rights that comprise any financial
asset credited to the Collateral Account;

          (d)  all property delivered to the Securities Intermediary pursuant to
this Agreement or the Purchase Contract Agreement will be credited promptly to
the Collateral Account;

          (e)  all securities or other property underlying any financial assets
credited to the Collateral Account shall be registered in the name of the
Securities Intermediary, indorsed to the Securities Intermediary or in blank, or
credited to another securities account maintained in the name of the Securities
Intermediary, and in no case will any financial asset credited to the Collateral
Account be registered in the name of the Purchase Contract Agent or any Holder,
payable to the order of the Purchase Contract Agent or any Holder or specially
indorsed to the Purchase Contract Agent or any Holder.

          SECTION 4.02. TREATMENT AS FINANCIAL ASSETS. Each item of property
(whether investment property, financial asset, security, instrument or cash)
credited to the Collateral Account shall be treated as a financial asset.

          SECTION 4.03. SOLE CONTROL BY COLLATERAL AGENT. Except as provided in
Section 6.01, at all times prior to the termination of the Pledge, the
Collateral Agent shall have sole control of the Collateral Account, and the
Securities Intermediary shall take instructions and directions with respect to
the Collateral Account solely from the Collateral Agent. If at any time the
Securities Intermediary shall receive an entitlement order issued by the
Collateral Agent and relating to the Collateral Account, the Securities
Intermediary shall comply with such entitlement order without further consent by
the Purchase Contract Agent or any Holder or any other Person. Until termination
of the Pledge, the Securities

                                        9


Intermediary will not comply with any entitlement orders issued by the Purchase
Contract Agent or any Holder.

          SECTION 4.04. SECURITIES INTERMEDIARY'S LOCATION. The Collateral
Account, and the rights and obligations of the Securities Intermediary, the
Collateral Agent, the Purchase Contract Agent and the Holders with respect
thereto, shall be governed by the laws of the State of New York. Regardless of
any provision in any other agreement, for purposes of the UCC, New York shall be
deemed to be the Securities Intermediary's location.

          SECTION 4.05. NO OTHER CLAIMS. Except for the claims and interest of
the Collateral Agent and of the Purchase Contract Agent and the Holders in the
Collateral Account, the Securities Intermediary (without making any
investigation) does not know of any claim to, or interest in, the Collateral
Account or in any financial asset credited thereto. If any Person asserts any
lien, encumbrance or adverse claim (including any writ, garnishment, judgment,
warrant of attachment, execution or similar process) against the Collateral
Account or in any financial asset carried therein, the Securities Intermediary
will promptly notify the Collateral Agent and the Purchase Contract Agent.

          SECTION 4.06. INVESTMENT AND RELEASE. All proceeds of financial assets
from time to time deposited in the Collateral Account shall be invested and
reinvested as provided in this Agreement. At all times prior to termination of
the Pledge, no property shall be released from the Collateral Account except in
accordance with this Agreement or upon written instructions of the Collateral
Agent.

          SECTION 4.07. STATEMENTS AND CONFIRMATIONS. The Securities
Intermediary will promptly send copies of all statements, confirmations and
other correspondence concerning the Collateral Account and any financial assets
credited thereto simultaneously to each of the Purchase Contract Agent and the
Collateral Agent at their addresses for notices under this Agreement.

          SECTION 4.08. TAX ALLOCATIONS. The Purchase Contract Agent shall
report all items of income, gain, expense and loss recognized in the Collateral
Account, to the extent such reporting is required by law, to the Internal
Revenue Service and all state and local taxing authorities under the names and
taxpayer identification numbers of the Holders which are the beneficial owners
thereof. Neither the Securities Intermediary nor the Collateral Agent shall have
any tax reporting duties hereunder.

          SECTION 4.09. NO OTHER AGREEMENTS. The Securities Intermediary has not
entered into, and prior to the termination of the Pledge will not enter into,
any agreement with any other Person relating to the Collateral Account or any

                                       10


financial assets credited thereto, including, without limitation, any agreement
to comply with entitlement orders of any Person other than the Collateral Agent.

          SECTION 4.10. POWERS COUPLED WITH AN INTEREST. The rights and powers
granted in this Article 4 to the Collateral Agent have been granted in order to
perfect its security interests in the Collateral Account, are powers coupled
with an interest and will be affected neither by the bankruptcy of the Purchase
Contract Agent or any Holder nor by the lapse of time. The obligations of the
Securities Intermediary under this Article 4 shall continue in effect until the
termination of the Pledge.

                                    ARTICLE 5
         INITIAL DEPOSIT, ESTABLISHMENT OF TREASURY STOCK PURCHASE UNITS
                   AND REESTABLISHMENT OF STOCK PURCHASE UNITS

          SECTION 5.01. INITIAL DEPOSIT OF PREFERRED SECURITIES. Prior to or
concurrently with the execution and delivery of this Agreement, the Purchase
Contract Agent, on behalf of the initial Holders of the Stock Purchase Units,
shall Transfer to the Securities Intermediary, for credit to the Collateral
Account, the Preferred Securities or security entitlements relating thereto, and
the Securities Intermediary shall indicate by book-entry that a securities
entitlement to such Preferred Securities has been credited to the Collateral
Account.

          SECTION 5.02. ESTABLISHMENT OF TREASURY STOCK PURCHASE UNITS.

          (a)  So long as no Tax Event Redemption shall have occurred, and the
Trust shall not have been dissolved and liquidated, at any time prior to or on
the seventh Business Day immediately preceding the Purchase Contract Settlement
Date, a Holder of Stock Purchase Units shall have the right to establish or
reestablish Treasury Stock Purchase Units by substitution of Treasury Securities
or security entitlements with respect thereto for the Pledged Preferred
Securities comprising a part of such Holder's Stock Purchase Units in integral
multiples of 40 Stock Purchase Units by:

                 (i)   Transferring to the Securities Intermediary for credit to
          the Collateral Account Treasury Securities or security entitlements
          with respect thereto having a Value equal to the aggregate liquidation
          amount of the Pledged Preferred Securities to be released, accompanied
          by a notice, substantially in the form of Exhibit C to the Purchase
          Contract Agreement, whereupon the Purchase Contract Agent shall
          deliver to the Collateral Agent a notice, substantially in the form of
          Exhibit A hereto, (A) stating that such Holder has Transferred
          Treasury Securities or security entitlements with respect thereto to
          the Securities Intermediary for credit to the Collateral Account, (B)
          stating the Value of the Treasury

                                       11


          Securities or security entitlements with respect thereto Transferred
          by such Holder and (C) requesting that the Collateral Agent release
          from the Pledge the Pledged Preferred Securities that are a component
          of such Stock Purchase Units; and

                (ii)   delivering the related Stock Purchase Units to the
          Purchase Contract Agent.

          Upon receipt of such notice and confirmation that Treasury Securities
or security entitlements with respect thereto have been credited to the
Collateral Account as described in such notice, the Collateral Agent shall
instruct the Securities Intermediary by a notice, substantially in the form of
Exhibit B hereto, to release such Pledged Preferred Securities from the Pledge
by Transfer to the Purchase Contract Agent for distribution to such Holder, free
and clear of any lien, pledge or security interest created hereby.

          (b)  If a Tax Event Redemption has occurred and the Treasury Portfolio
has become a component of the Stock Purchase Units, a Holder of Stock Purchase
Units shall not have the right to establish or reestablish Treasury Stock
Purchase Units.

          (c)  If no Tax Event Redemption shall have occurred, but the Trust
shall have been dissolved and liquidated, and the [Subordinated] Notes have
become a component of the Stock Purchase Units, at any time on or prior to the
seventh Business Day immediately preceding the Purchase Contract Settlement
Date, a Holder of Stock Purchase Units shall have the right to substitute
Treasury Securities or security entitlements with respect thereto for the
Pledged [Subordinated] Notes comprising a part of such Holder's Stock Purchase
Units in integral multiples of 40 Stock Purchase Units by:

                 (i)   Transferring to the Securities Intermediary for credit to
          the Collateral Account Treasury Securities or security entitlements
          with respect thereto having a Value equal to the aggregate principal
          amount at maturity of Pledged [Subordinated] Notes to be released,
          accompanied by a notice, substantially in the form of Exhibit C to the
          Purchase Contract Agreement, whereupon the Purchase Contract Agent
          shall deliver to the Collateral Agent a notice, substantially in the
          form of Exhibit A hereto, (A) stating that such Holder has Transferred
          Treasury Securities or security entitlements with respect thereto to
          the Securities Intermediary for credit to the Collateral Account, (B)
          stating the Value of the Treasury Securities or securities
          entitlements with respect thereto Transferred by such Holder and (C)
          requesting that the Collateral Agent release from the Pledge the
          Pledged [Subordinated] Notes that are a component of such Stock
          Purchase Units; and

                                       12


                (ii)   delivering the related Stock Purchase Units to the
          Purchase Contract Agent.

          Upon receipt of such notice and confirmation that Treasury Securities
or security entitlements with respect thereto have been credited to the
Collateral Account as described in such notice, the Collateral Agent shall
instruct the Securities Intermediary by a notice, substantially in the form of
Exhibit B hereto, to release such Pledged [Subordinated] Notes from the Pledge
by Transfer to the Purchase Contract Agent for distribution to such Holder free
and clear of any lien, pledge or security interest created hereby.

          (d)  Upon credit to the Collateral Account of Treasury Securities or
security entitlements with respect thereto delivered by a Holder of Stock
Purchase Units and receipt of the related instruction from the Collateral Agent,
the Securities Intermediary shall release the Pledged Preferred Securities or
the Pledged [Subordinated] Notes, as the case may be, and shall promptly
transfer the same to the Purchase Contract Agent for distribution to such
Holder, free and clear of any lien, pledge or security interest created hereby.

          SECTION 5.03. REESTABLISHMENT OF STOCK PURCHASE UNITS.

          (a)  So long as no Tax Event Redemption shall have occurred, and the
Trust shall not have been dissolved and liquidated, at any time on or prior to
the seventh Business Day immediately preceding the Purchase Contract Settlement
Date, a Holder of Treasury Stock Purchase Units shall have the right to
reestablish Stock Purchase Units by substitution of Preferred Securities or
security entitlements with respect thereto for Pledged Treasury Securities in
integral multiples of 40 Treasury Stock Purchase Units by:

                 (i)   Transferring to the Securities Intermediary for credit to
          the Collateral Account Preferred Securities or security entitlements
          with respect thereto having a liquidation amount equal to the Value of
          the Pledged Treasury Securities to be released, accompanied by a
          notice, substantially in the form of Exhibit C to the Purchase
          Contract Agreement, whereupon the Purchase Contract Agent shall
          deliver to the Collateral Agent a notice, substantially in the form of
          Exhibit C hereto, stating that such Holder has transferred Preferred
          Securities or security entitlements with respect thereto to the
          Securities Intermediary for credit to the Collateral Account and
          requesting that the Collateral Agent release from the Pledge the
          Pledged Treasury Securities related to such Treasury Stock Purchase
          Units; and

                (ii)   Delivering the related Treasury Stock Purchase Units to
          the Purchase Contract Agent.

                                       13


          Upon receipt of such notice and confirmation that Preferred Securities
or security entitlements thereto have been credited to the Collateral Account as
described in such notice, the Collateral Agent shall instruct the Securities
Intermediary by a notice in the form provided in Exhibit D to release such
Pledged Treasury Securities from the Pledge by Transfer to the Purchase Contract
Agent for distribution to such Holder, free and clear of any lien, pledge or
security interest created hereby.

          (b)  If a Tax Event Redemption has occurred and the Treasury Portfolio
has become a component of the Stock Purchase Units, a holder of a Treasury Stock
Purchase Unit shall not have the right to reestablish a Stock Purchase Unit.

          (c)  If no Tax Event Redemption shall have occurred, but the Trust
shall have been dissolved and liquidated, and the [Subordinated] Notes have
become a component of the Stock Purchase Units, at any time on or prior to the
seventh Business Day immediately preceding the Purchase Contract Settlement
Date, a Holder of Treasury Stock Purchase Units shall have the right to
reestablish Stock Purchase Units by substitution of [Subordinated] Notes or
security entitlements with respect thereto for Pledged Treasury Securities in
integral multiples of 40 Treasury Stock Purchase Units by:

                 (i)   Transferring to the Securities Intermediary for credit to
          the Collateral Account [Subordinated] Notes or security entitlements
          with respect thereto having a principal amount equal to the Value of
          the Pledged Treasury Securities to be released, accompanied by a
          notice, substantially in the form of Exhibit C to the Purchase
          Contract Agreement, whereupon the Purchase Contract Agent shall
          deliver to the Collateral Agent a notice, substantially in the form of
          Exhibit C hereto, stating that such Holder has Transferred the
          [Subordinated] Notes or security entitlements with respect thereto to
          the Securities Intermediary for credit to the Collateral Account and
          requesting that the Collateral Agent release from the Pledge the
          Pledged Treasury Securities related to such Treasury Stock Purchase
          Units; and

                (ii)   delivering the related Treasury Stock Purchase Units to
          the Purchase Contract Agent.

          Upon receipt of such notice and confirmation that [Subordinated] Notes
or security entitlements with respect thereto have been credited to the
Collateral Account as described in such notice, the Collateral Agent shall
instruct the Securities Intermediary by a notice in the form provided in Exhibit
D to release such Pledged Treasury Securities from Pledge by Transfer to the
Purchase Contract Agent for

                                       14


distribution to such Holder, free and clear of any lien, pledge or security
interest created hereby.

          (d)  Upon credit to the Collateral Account of Preferred Securities or
security entitlements with respect thereto or [Subordinated] Notes or security
entitlements with respect thereto, as the case may be, delivered by a Holder of
Treasury Stock Purchase Units and receipt of the related instruction from the
Collateral Agent, the Securities Intermediary shall release the Pledged Treasury
Securities and shall promptly transfer the same to the Purchase Contract Agent
for distribution to such Holder, free and clear of any lien, pledge or security
interest created hereby.

          SECTION 5.04. TERMINATION EVENT.

          (a)  Upon receipt by the Collateral Agent of written notice from the
Company or the Purchase Contract Agent that a Termination Event has occurred,
the Collateral Agent shall release all Collateral from the Pledge and shall
promptly Transfer:

                 (i)   any Pledged Preferred Securities or security entitlements
          with respect thereto or the Applicable Ownership Interest (as
          specified in clause (A) of the definition of such term) of the
          Treasury Portfolio (if a Tax Event Redemption has occurred and the
          Treasury Portfolio has become a component of the Stock Purchase Units)
          or the Pledged [Subordinated] Notes (if the Trust has been dissolved
          and liquidated, and the [Subordinated] Notes or security entitlements
          with respect thereto have become a component of the Stock Purchase
          Units);

                (ii)   any Pledged Treasury Securities, and

               (iii)   payments by Holders (or the Permitted Investments of such
          payments) pursuant to Section 5.05 hereof,

to the Purchase Contract Agent for the benefit of the Holders for distribution
to such Holders in accordance with their respective interests, free and clear of
any lien, pledge or security interest or other interest created hereby;
provided, however, if any Holder shall be entitled to receive less than $1,000
with respect to his interest in the Applicable Ownership Interest (as specified
in clause (A) of the definition of such term) of the Treasury Portfolio, the
Purchase Contract Agent shall have the right to dispose of such interest for
cash and deliver to such Holder cash in lieu of delivering the Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio.

          (b)  If such Termination Event shall result from the Company's
becoming a debtor under the Bankruptcy Code, and if the Collateral Agent shall
for any reason fail promptly to effectuate the release and Transfer of all
Pledged

                                       15


Preferred Securities, the Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, the
Pledged [Subordinated] Notes, the Pledged Treasury Securities or payments by
Holders (or the Permitted Investments of such payments) pursuant to Section 5.05
hereof, as the case may be, as provided by this Section 5.04, the Purchase
Contract Agent shall:

                 (i)   use its best efforts to obtain an opinion of a nationally
          recognized law firm reasonably acceptable to the Collateral Agent to
          the effect that, as a result of the Company's being the debtor in such
          a bankruptcy case, the Collateral Agent will not be prohibited from
          releasing or Transferring the Collateral as provided in this Section
          5.04, and shall deliver such opinion to the Collateral Agent within
          ten days after the occurrence of such Termination Event, and if (A)
          the Purchase Contract Agent shall be unable to obtain such opinion
          within ten days after the occurrence of such Termination Event or (B)
          the Collateral Agent shall continue, after delivery of such opinion,
          to refuse to effectuate the release and Transfer of all Pledged
          Preferred Securities, Applicable Ownership Interest (as specified in
          clause (A) of the definition of such term) of the Treasury Portfolio,
          all the Pledged [Subordinated] Notes, the Pledged Treasury Securities,
          the payments by Holders or the Permitted Investments of such payments
          pursuant to Section 5.05 hereof or the Proceeds of any of the
          foregoing, as the case may be, as provided in this Section 5.04, then
          the Purchase Contract Agent shall within fifteen days after the
          occurrence of such Termination Event commence an action or proceeding
          in the court having jurisdiction of the Company's case under the
          Bankruptcy Code seeking an order requiring the Collateral Agent to
          effectuate the release and transfer of all Pledged Preferred
          Securities, Applicable Ownership Interest (as specified in clause (A)
          of the definition of such term) of the Treasury Portfolio, all the
          Pledged [Subordinated] Notes, the Pledged Treasury Securities, or the
          payments by Holders or the Permitted Investments of such payments
          pursuant to Section 5.05 hereof, or as the case may be, as provided by
          this Section 5.04; or

                (ii)   commence an action or proceeding like that described in
          clause 5.04(b)(i) hereof within ten days after the occurrence of such
          Termination Event.

          SECTION 5.05.  CASH SETTLEMENT.

          (a)  Upon receipt by the Collateral Agent of (1) a notice from the
Purchase Contract Agent promptly after the receipt by the Purchase Contract
Agent of a notice from a Holder of Stock Purchase Units that such Holder has
elected, in accordance with the procedures specified in Section 5.02(a)(i) or
(d)(i)

                                       16


of the Purchase Contract Agreement, respectively, to effect a Cash Settlement
and (2) payment by such Holder by deposit in the Collateral Account prior to
11:00 a.m. (New York City time) on the fifth Business Day immediately preceding
the Purchase Contract Settlement Date, in the case of a Stock Purchase Unit,
unless a Tax Event Redemption has occurred, or on the Business Day prior to the
Purchase Contract Settlement Date in the case of Treasury Stock Purchase or a
Stock Purchase Unit, if a Tax Event Redemption has occurred, of the Purchase
Price in lawful money of the United States by certified or cashier's check or
wire transfer of immediately available funds payable to or upon the order of the
Securities Intermediary, then the Collateral Agent shall:

                 (i)   instruct the Securities Intermediary promptly to invest
          any such Cash in Permitted Investments;

                (ii)   release from the Pledge the Stock Purchase Unit holder's
          or the Treasury Stock Purchase Unit holder's related Pledged Preferred
          Securities, Applicable Ownership Interest (as specified in clause (A)
          of the definition of such term) of the Treasury Portfolio, the Pledged
          [Subordinated] Notes or Pledged Treasury Securities, as applicable, as
          to which such Holder has elected to effect a Cash Settlement pursuant
          to this Section 5.05(a); and

               (iii)   instruct the Securities Intermediary to Transfer all such
          Pledged Preferred Securities, Applicable Ownership Interest (as
          specified in clause (A) of the definition of such term) of the
          Treasury Portfolio, Pledged [Subordinated] Notes or the Pledged
          Treasury Securities, as the case may be, to the Purchase Contract
          Agent for the benefit of such Holder, in each case free and clear of
          the Pledge created hereby, for distribution to such Holder.

          Upon the request of the Securities Intermediary, the Company shall
instruct the Securities Intermediary in writing as to the type of Permitted
Investments in which any such Cash shall be invested; provided, however, that if
the Company fails to deliver such written instructions by 10:30 a.m. (New York
City time), the Securities Intermediary shall invest such Cash in the Permitted
Investments described in clause (6) of the definition of Permitted Investments.

          Upon receipt of the proceeds upon the maturity of the Permitted
Investments on the Purchase Contract Settlement Date, the Collateral Agent shall
(A) instruct the Securities Intermediary to pay the portion of such proceeds and
deliver any certified or cashier's checks received, in an aggregate amount equal
to the Purchase Price, to the Company on the Purchase Contract Settlement Date,
and (B) instruct the Securities Intermediary to release any amounts in excess of

                                       17


the Purchase Price earned from such Permitted Investments to the Purchase
Contract Agent for distribution to such Holder.

          (b)  If a Holder of Stock Purchase Units (if a Tax Event Redemption
shall not have occurred) notifies the Purchase Contract Agent as provided in
paragraph 5.02(a)(i) of the Purchase Contract Agreement of its intention to pay
the Purchase Price in cash, but fails to make such payment as required by
paragraph 5.02(a)(ii) of the Purchase Contract Agreement, such Holder shall be
deemed to have consented to the disposition of such Holder's Pledged Preferred
Securities or Pledged [Subordinated] Notes in accordance with paragraph
5.02(a)(iii) of the Purchase Contract Agreement.

          (c)  If a Holder of a Treasury Stock Purchase Unit or a Holder of
Stock Purchase Unit (if a Tax Event Redemption shall have occurred) notifies the
Purchase Contract Agent as provided in paragraph 5.02(d)(i) of the Purchase
Contract Agreement of its intention to pay the Purchase Price in cash, but fails
to make such payment as required by paragraph 5.02(d)(ii) of the Purchase
Contract Agreement, such Holder shall be deemed to have elected to pay the
Purchase Price in accordance with paragraph 5.02(d)(iii) of the Purchase
Contract Agreement.

          (d)  As soon as practicable after 11:00 a.m. (New York City time) on
the fifth Business Day immediately preceding the Purchase Contract Settlement
Date, the Securities Intermediary shall deliver to the Purchase Contract Agent a
notice, substantially in the form of Exhibit E hereto, stating (i) the amount of
cash that it has received with respect to the Cash Settlement of Stock Purchase
Units and (ii) the amount of cash that it has received with respect to the Cash
Settlement of Treasury Stock Purchase Units.

          SECTION 5.06. EARLY SETTLEMENT. Upon receipt by the Collateral Agent
of a notice from the Purchase Contract Agent that a Holder of Securities has
elected to effect Early Settlement of its obligations under the Purchase
Contracts forming a part of such Securities in accordance with the terms of the
Purchase Contracts and Section 5.07 of the Purchase Contract Agreement (which
notice shall set forth the number of such Purchase Contracts as to which such
Holder has elected to effect Early Settlement), and that the Purchase Contract
Agent has received from such Holder, and paid to the Company as confirmed in
writing by the Company, the related Early Settlement Amounts pursuant to the
terms of the Purchase Contracts and the Purchase Contract Agreement and that all
conditions to such Early Settlement have been satisfied, then the Collateral
Agent shall release from the Pledge, (1) Pledged Preferred Securities or the
appropriate Applicable Ownership Interest (as

                                       18


specified in clause (A) of the definitions at such term) of the Treasury
Portfolio or Pledged [Subordinated] Notes in the case of a Holder of Stock
Purchase Units or (2) Pledged Treasury Securities, in the case of a Holder of
Treasury Stock Purchase Units, with a Value equal to the product of (x) the
Stated Amount times (y) the number of Purchase Contracts as to which such Holder
has elected to effect Early Settlement, and shall instruct the Securities
Intermediary to Transfer all such Pledged Preferred Securities or the
appropriate Applicable Ownership Interest (as specified in clause (A) of the
definitions at such term) of the Treasury Portfolio or Pledged [Subordinated]
Notes or Pledged Treasury Securities, as the case may be, to the Purchase
Contract Agent for the benefit of such Holder, in each case free and clear of
the Pledge created hereby, for distribution to such Holder. A Treasury Stock
Purchase Unit holder may settle early only in integral multiples of 40 Purchase
Contracts.

          SECTION 5.07. APPLICATION OF PROCEEDS IN SETTLEMENT OF PURCHASE
CONTRACTS.

          (a)  If a Holder of Stock Purchase Units (if a Tax Event Redemption
has not occurred) has not elected to make an effective Cash Settlement by
notifying the Purchase Contract Agent in the manner provided for in Section
5.02(a)(i) in the Purchase Contract Agreement, or has given such notice but
failed to deliver the required cash prior to 11:00 a.m. (New York City time) on
the fifth Business Day immediately preceding the Purchase Contract Settlement
Date, such Holder shall be deemed to have elected to pay for the shares of
Common Stock to be issued under such Purchase Contracts from the Proceeds of the
remarketing of the related Pledged Preferred Securities or Pledged
[Subordinated] Notes. Upon written notice of such event from the Purchase
Contract Agent, the Collateral Agent shall instruct the Securities Intermediary
to Transfer the related Pledged Preferred Securities or Pledged [Subordinated]
Notes to the Remarketing Agent for remarketing. Upon receiving such Pledged
Preferred Securities or Pledged [Subordinated] Notes, the Remarketing Agent,
pursuant to the terms of the Remarketing Agreement, will use reasonable efforts
to remarket such Pledged Preferred Securities or Pledged [Subordinated] Notes.
The Remarketing Agent will deposit the Proceeds of such remarketing (less
$[0.0625] per each Preferred Security remarketed, which shall be retained by the
Remarketing Agent as a fee for its services in the Remarketing) in the
Collateral Account, and the Securities Intermediary shall invest the Proceeds of
the remarketing in Permitted Investments in clause (6) of the definition of
Permitted Investments. On the Purchase Contract Settlement Date, the Purchase
Contract Agent shall give

                                       19


written direction to the Collateral Agent specifying the instruction the
Collateral Agent shall give to the Securities Intermediary in order to apply a
portion of the Proceeds from such remarketing equal to the aggregate liquidation
amount of the Preferred Securities or aggregate principal amount of such Pledged
[Subordinated] Note to satisfy in full such Holder's obligations to pay the
Purchase Price to purchase the shares of Common Stock under the related Purchase
Contracts and the balance of the Proceeds from the remarketing, if any, that
shall be transferred to the Purchase Contract Agent for the benefit of such
Holder for distribution to such Holder.

          If the Remarketing Agent advises the Collateral Agent in writing that
there has been a Failed Remarketing, thus resulting in an event of default under
the Purchase Contract Agreement and hereunder, the Collateral Agent, for the
benefit of the Company shall, at the written direction of the Company, use
commercially reasonable efforts to dispose of the Pledged Preferred Securities
or Pledged [Subordinated] Notes in accordance with applicable law and apply the
proceeds from such disposition towards such Holder's obligations to pay the
Purchase Price for the shares of Common Stock.

          (b)  If a Holder of a Treasury Stock Purchase Unit or a Holder of
Stock Purchase Unit (if a Tax Event Redemption has occurred) has not elected to
make an effective Cash Settlement by notifying the Purchase Contract Agent in
the manner provided for in Section 5.02(d)(i) of the Purchase Contract
Agreement, or has given such notice but failed to make such payment in the
manner required by Section 5.02(d)(ii) of the Purchase Contract Agreement, such
Holder shall be deemed to have elected to pay for the shares of Common Stock to
be issued under such Purchase Contracts from the Proceeds of the related Pledged
Treasury Securities or such Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, as the
case may be. Promptly, after 11:00 a.m. (New York City time) on the Business Day
immediately prior to the Purchase Contract Settlement Date, the Securities
Intermediary shall invest the Cash Proceeds of the maturing Pledged Treasury
Securities or such Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio, as the case may be, in
Permitted Investments in clause 6 of the definition of Permitted Investments,
unless prior to 10:30 a.m. (New York City time), the Company shall otherwise
instruct the Securities Intermediary as to the type of Permitted Investments in
which any such Cash Proceeds shall be invested. Without receiving any
instruction from any such Holder, the Collateral Agent shall apply the Proceeds
of the related Pledged Treasury Securities or such Applicable Ownership Interest
(as specified in clause (A) of the definition of such term) of the Treasury
Portfolio, as the case may be, to the settlement of such Purchase Contracts on
the Purchase Contract Settlement Date. In the event the sum of the Proceeds from
the related Pledged Treasury Securities or such Applicable Ownership Interest
(as specified in clause (A) of the definition of such

                                       20


term) of the Treasury Portfolio as the case may be, and the investment earnings
from the investment in Permitted Investments exceeds the aggregate Purchase
Price of the Purchase Contracts being settled thereby, the Collateral Agent
shall instruct the Securities Intermediary to distribute such excess, when
received, to the Purchase Contract Agent for the benefit of such Holder for
distribution to such Holder.

          SECTION 5.08. TAX EVENT REDEMPTION. If the Securities Intermediary
receives written notice that a Tax Event Redemption has occurred prior to the
Purchase Contract Settlement Date, the Securities Intermediary shall apply the
Redemption Amount to purchase the Treasury Portfolio and the Securities
Intermediary shall credit the Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio to the
Collateral Account and shall transfer the Applicable Ownership Interest (as
specified in clause (B) of the definition of such term) of the Treasury
Portfolio to the Purchase Contract Agent for distribution to the Holders of the
Stock Purchase Units. Upon credit to the Collateral Account of the Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio having a Value equal to the liquidation amount of the
Pledged Preferred Securities or the aggregate principal amount of the Pledged
[Subordinated] Notes, the Securities Intermediary shall release the Pledged
Preferred Securities or the Pledged [Subordinated] Notes, as applicable, from
the Collateral Account and shall promptly transfer the Pledged Preferred
Securities to the Trust and the Pledged [Subordinated] Notes to the Company, as
applicable.

                                    ARTICLE 6
            VOTING RIGHTS - PLEDGED PREFERRED SECURITIES AND PLEDGED
                              [SUBORDINATED] NOTES

          SECTION 6.01. VOTING RIGHTS. The Purchase Contract Agent may exercise,
or refrain from exercising, any and all voting and other consensual rights
pertaining to the Pledged Preferred Securities or the Pledged [Subordinated]
Notes or any part thereof for any purpose not inconsistent with the terms of
this Agreement and in accordance with the terms of the Purchase Contract
Agreement; provided, that the Purchase Contract Agent shall not exercise or
shall not refrain from exercising such right, as the case may be, if, in the
judgment of the Purchase Contract Agent, such action would impair or otherwise
have a material adverse effect on the value of all or any of the Pledged
Preferred Securities or the Pledged [Subordinated] Notes; and provided, further,
that the Purchase Contract Agent shall give the Company and the Collateral Agent
at least five Business Days' prior written notice of the manner in which it
intends to exercise, or its reasons for refraining from exercising, any such
right. Upon receipt of any notices and other

                                       21


communications in respect of any Pledged Preferred Securities or the Pledged
[Subordinated] Notes, including notice of any meeting at which holders of the
Preferred Securities or the [Subordinated] Notes are entitled to vote or
solicitation of consents, waivers or proxies of holders of the Preferred
Securities or [Subordinated] Notes, the Collateral Agent shall use reasonable
efforts to send promptly to the Purchase Contract Agent such notice or
communication, and as soon as reasonably practicable after receipt of a written
request therefor from the Purchase Contract Agent, execute and deliver to the
Purchase Contract Agent such proxies and other instruments in respect of such
Pledged Preferred Securities or the Pledged [Subordinated] Notes (in form and
substance satisfactory to the Collateral Agent) as are prepared by the Purchase
Contract Agent with respect to the Pledged Preferred Securities or the Pledged
[Subordinated] Notes.

                                    ARTICLE 7
                               RIGHTS AND REMEDIES

          SECTION 7.01.  RIGHTS AND REMEDIES OF THE COLLATERAL AGENT.

          (a)  In addition to the rights and remedies specified in Section 5.07
hereof or otherwise available at law or in equity, after an event of default (as
specified in Section 7.01(b) below) hereunder, the Collateral Agent shall have
all of the rights and remedies with respect to the Collateral of a secured party
under the UCC (whether or not the UCC is in effect in the jurisdiction where the
rights and remedies are asserted) and the TRADES Regulations and such additional
rights and remedies to which a secured party is entitled under the laws in
effect in any jurisdiction where any rights and remedies hereunder may be
asserted. Without limiting the generality of the foregoing, such remedies may
include, to the extent permitted by applicable law, (1) retention of the Pledged
Preferred Securities, Pledged [Subordinated] Notes, Pledged Treasury Securities
or the appropriate Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) in full satisfaction of the Holders' obligations
under the Purchase Contracts and the Purchase Contract Agreement or (2) sale of
the Pledged Preferred Securities, Pledged [Subordinated] Notes, Pledged Treasury
Securities or the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) in one or more public or private
sales.

          (b) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, in the event the Collateral Agent is unable
to make payments to the Company on account of the appropriate Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio, or on account of principal payments of any Pledged
Treasury Securities as provided in Article 3 hereof, in satisfaction of the
Obligations of the Holder of the Stock Purchase Units (if a Tax Event Redemption
has occurred) of which such appropriate Applicable Ownership Interest (as

                                       22


specified in clause (A) of the definition of such term) of the Treasury
Portfolio or the Holder of the Treasury Stock Purchase Units of which such
Pledged Treasury Securities, as applicable, is a part under the related Purchase
Contracts, the inability to make such payments shall constitute an event of
default hereunder and the Collateral Agent shall have and may exercise, with
reference to such Pledged Treasury Securities or the appropriate Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio, as applicable, any and all of the rights and remedies
available to a secured party under the UCC and the TRADES Regulations after
default by a debtor, and as otherwise granted herein or under any other law.

          (c)  Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, the Collateral Agent is hereby irrevocably
authorized to receive and collect all payments of (i) the liquidation amount of
the Pledged Preferred Securities, (ii) the principal amount of the Pledged
[Subordinated] Notes, (iii) the principal amount of the Pledged Treasury
Securities and (iv) the principal amount of the Applicable Ownership Interest
(as specified in clause (A) of the definition of such term) of the Treasury
Portfolio, subject, in each case, to the provisions of Section 3 hereof, and as
otherwise granted herein.

          (d)  The Purchase Contract Agent and each Holder of Securities agrees
that, from time to time, upon the written request of the Collateral Agent or the
Purchase Contract Agent, such Holder shall execute and deliver such further
documents and do such other acts and things as the Collateral Agent may
reasonably request in order to maintain the Pledge, and the perfection and
priority thereof, and to confirm the rights of the Collateral Agent hereunder.
The Purchase Contract Agent shall have no liability to any Holder for executing
any documents or taking any such acts requested by the Collateral Agent
hereunder, except for liability for its own negligent acts, its own negligent
failure to act or its own willful misconduct.

          SECTION 7.02. SUBSTITUTION OF [SUBORDINATED] NOTES OR TREASURY
PORTFOLIO. If the Trust shall have been dissolved and liquidated prior to the
Purchase Contract Settlement Date, the Securities Intermediary shall transfer to
the Collateral Agent [Subordinated] Notes having a Value equal to the
liquidation amount of the Pledged Preferred Securities for credit to the
Collateral Account. Upon credit to the Collateral Account of such [Subordinated]
Notes, the Collateral Agent shall release the Pledged Preferred Securities from
the Collateral Account and shall promptly transfer the same to the Trust.

          Notwithstanding the foregoing, in the event of a dissolution and
liquidation of the Trust, if a Liquidation Distribution is to be distributed in
lieu of the [Subordinated] Notes as provided for in the Declaration, the
Liquidation

                                       23


Distribution shall be credited to the Collateral Account by the Property
Trustee, on or prior to 12:30 p.m., New York City time on the date of
distribution of the Liquidation Distribution, by federal funds check or wire
transfer of immediately available funds. The Collateral Agent is hereby
authorized to present the Pledged Preferred Securities for payment as may be
required by their terms. Upon receipt of such funds, the Pledged Preferred
Securities shall be released from the Collateral Account. In the event such
funds are credited to the Collateral Account, the Collateral Agent, at the
written direction of the Company, shall instruct the Securities Intermediary to
(a) apply an amount equal to the Redemption Amount of such Liquidation
Distribution to purchase the Treasury Portfolio from the Quotation Agent for
credit to the Collateral Account and (b) promptly remit the remaining portion of
such Liquidation Distribution, if any, to the Purchase Contract Agent for
payment to the Holders of Stock Purchase Units.

          SECTION 7.03. TAX EVENT REDEMPTION. Upon the occurrence of a Tax Event
Redemption prior to the Purchase Contract Settlement Date, the Redemption
Amount, plus any accumulated and unpaid distributions, or any accrued and unpaid
interest, as the case may be, payable on the Tax Event Redemption Date with
respect to the Applicable Principal Amount shall be credited to the Collateral
Account by the Property Trustee or, in case there has been a dissolution of the
Trust and the distribution of the related [Subordinated] Notes, by the Indenture
Trustee, on or prior to 12:30 p.m., New York City time on such Tax Event
Redemption Date, by federal funds check or wire transfer of immediately
available funds. The Collateral Agent is hereby authorized to present the
Pledged Preferred Securities or the Pledged [Subordinated] Notes for payment as
may be required by their respective terms. Upon receipt of such funds, the
Pledged Preferred Securities or Pledged [Subordinated] Notes, as the case may
be, shall be released from the Collateral Account. In the event such funds are
credited to the Collateral Account, the Collateral Agent, at the written
direction of the Company, shall instruct the Securities Intermediary to (a)
apply an amount equal to the Redemption Amount of such funds to purchase the
Treasury Portfolio from the Quotation Agent for credit to the Collateral Account
and (b) promptly remit the remaining portion of such funds, if any, to the
Purchase Contract Agent for payment to the Holders of Stock Purchase Units.

          SECTION 7.04. SUBSTITUTIONS. Whenever a Holder has the right to
substitute Treasury Securities, Preferred Securities, [Subordinated] Notes or
security entitlements for any of them or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, for financial assets
held in the Collateral Account, such substitution shall not constitute a
novation of the security interest created hereby.

                                    ARTICLE 8

                                       24


                    REPRESENTATIONS AND WARRANTIES; COVENANTS

          SECTION 8.01. REPRESENTATIONS AND WARRANTIES. Each Holder from time to
time, acting through the Purchase Contract Agent as attorney-in-fact (it being
understood that the Purchase Contract Agent shall not be liable for any
representation or warranty made by or on behalf of a Holder), hereby represents
and warrants to the Collateral Agent (with respect to such Holder's interest in
the Collateral), which representations and warranties shall be deemed repeated
on each day a Holder Transfers Collateral that:

          (a)  such Holder has the power to grant a security interest in and
lien on the Collateral;

          (b)  such Holder is the sole beneficial owner of the Collateral and,
in the case of Collateral delivered in physical form, is the sole holder of such
Collateral and is the sole beneficial owner of, or has the right to Transfer,
the Collateral it Transfers to the Securities Intermediary for credit to the
Collateral Account, free and clear of any security interest, lien, encumbrance,
call, liability to pay money or other restriction other than the security
interest and lien granted under Article 2 hereof;

          (c)  upon the Transfer of the Collateral to the Securities
Intermediary for credit to the Collateral Account, the Collateral Agent, for the
benefit of the Company, will have a valid and perfected first priority security
interest therein (assuming that any central clearing operation or any securities
intermediary or other entity not within the control of the Holder involved in
the Transfer of the Collateral, including the Collateral Agent and the
Securities Intermediary, gives the notices and takes the action required of it
hereunder and under applicable law for perfection of that interest and assuming
the establishment and exercise of control pursuant to Article 4 hereof); and

          (d)  the execution and performance by the Holder of its obligations
under this Agreement will not result in the creation of any security interest,
lien or other encumbrance on the Collateral other than the security interest and
lien granted under Article 2 hereof or violate any provision of any existing law
or regulation applicable to it or of any mortgage, charge, pledge, indenture,
contract or undertaking to which it is a party or which is binding on it or any
of its assets.

          SECTION 8.02. COVENANTS. The Holders from time to time, acting through
the Purchase Contract Agent as their attorney-in-fact (it being understood that
the Purchase Contract Agent shall not be liable for any covenant made by or on
behalf of a Holder), hereby covenant to the Collateral Agent that for so long as
the Collateral remains subject to the Pledge:

                                       25


          (a)  neither the Purchase Contract Agent nor such Holders will create
or purport to create or allow to subsist any mortgage, charge, lien, pledge or
any other security interest whatsoever over the Collateral or any part of it
other than pursuant to this Agreement; and

          (b)  neither the Purchase Contract Agent nor such Holders will sell or
otherwise dispose (or attempt to dispose) of the Collateral or any part of it
except for the beneficial interest therein, subject to the Pledge hereunder,
transferred in connection with the Transfer of the Securities.

                                    ARTICLE 9
              THE COLLATERAL AGENT AND THE SECURITIES INTERMEDIARY

          It is hereby agreed as follows:

          SECTION 9.01. APPOINTMENT, POWERS AND IMMUNITIES. The Collateral Agent
and Securities Intermediary shall act as agent for the Company hereunder with
such powers as are specifically vested in the Collateral Agent and Securities
Intermediary by the terms of this Agreement, together with such other powers as
are reasonably incidental thereto. The Collateral Agent and Securities
Intermediary shall:

          (a)  have no duties or responsibilities except those expressly set
forth in this Agreement and no implied covenants or obligations shall be
inferred from this Agreement against the Collateral Agent and Securities
Intermediary, nor shall the Collateral Agent and Securities Intermediary be
bound by the provisions of any agreement by any party hereto beyond the specific
terms hereof;

          (b)  not be responsible for any recitals contained in this Agreement,
or in any certificate or other document referred to or provided for in, or
received by it under, this Agreement, the Securities or the Purchase Contract
Agreement, or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement (other than as against the
Collateral Agent and Securities Intermediary), the Securities or the Purchase
Contract Agreement or any other document referred to or provided for herein or
therein or for any failure by the Company or any other Person (except the
Collateral Agent and Securities Intermediary) to perform any of its obligations
hereunder or thereunder or for the perfection, priority or, except as expressly
required hereby, maintenance of any security interest created hereunder;

          (c)  not be required to initiate or conduct any litigation or
collection proceedings hereunder (except pursuant to directions furnished under
Section 9.02 hereof, subject to Section 9.06 hereof);

                                       26


          (d)  not be responsible for any action taken or omitted to be taken by
it hereunder or under any other document or instrument referred to or provided
for herein or in connection herewith or therewith, except for its own negligence
or willful misconduct; and

          (e)  not be required to advise any party as to selling or retaining,
or taking or refraining from taking any action with respect to, any securities
or other property deposited hereunder.

Subject to the foregoing, during the term of this Agreement, the Collateral
Agent shall take all reasonable action in connection with the safekeeping and
preservation of the Collateral hereunder.

          No provision of this Agreement shall require the Collateral Agent or
Securities Intermediary to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder. In no
event shall the Collateral Agent or Securities Intermediary be liable for any
amount in excess of the Value of the Collateral. Notwithstanding the foregoing,
each of the Collateral Agent and the Securities Intermediary in its individual
capacity hereby waives any right of setoff, bankers' lien, liens or perfection
rights as securities intermediary or any counterclaim with respect to any of the
Collateral.

          SECTION 9.02. INSTRUCTIONS OF THE COMPANY. The Company shall have the
right, by one or more written instruments executed and delivered to the
Collateral Agent, to direct the time, method and place of conducting any
proceeding for the realization of any right or remedy available to the
Collateral Agent, or of exercising any power conferred on the Collateral Agent,
or to direct the taking or refraining from taking of any action authorized by
this Agreement; provided, however, that (i) such direction shall not conflict
with the provisions of any law or of this Agreement and (ii) the Collateral
Agent shall be adequately indemnified as provided herein. Nothing contained in
this Section 9.02 shall impair the right of the Collateral Agent in its
discretion to take any action or omit to take any action which it deems proper
and which is not inconsistent with such direction.

          SECTION 9.03. RELIANCE BY COLLATERAL AGENT AND SECURITIES
INTERMEDIARY. Each of the Securities Intermediary and the Collateral Agent
shall be entitled to rely upon any certification, order, judgment, opinion,
notice or other written communication (including, without limitation, any
thereof by e-mail or similar electronic means, telecopy, telex or facsimile)
believed by it to be genuine and correct and to have been signed or sent by or
on behalf of the proper Person or Persons (without being required to determine
the correctness of any fact stated therein) and consult with and rely upon
advice, opinions and statements of legal counsel and other experts selected by
the Collateral Agent and the Securities Intermediary. As to any matters not
expressly provided for by this Agreement, the Collateral Agent and the
Securities Intermediary shall in all cases be fully protected

                                       27


in acting, or in refraining from acting, hereunder in accordance with
instructions given by the Company in accordance with this Agreement.

          SECTION 9.04. RIGHTS IN OTHER CAPACITIES. The Collateral Agent and the
Securities Intermediary and their affiliates may (without having to account
therefor to the Company) accept deposits from, lend money to, make their
investments in and generally engage in any kind of banking, trust or other
business with the Purchase Contract Agent, any other Person interested herein
and any Holder of Securities (and any of their respective subsidiaries or
affiliates) as if it were not acting as the Collateral Agent or the Securities
Intermediary, as the case may be, and the Collateral Agent, the Securities
Intermediary and their affiliates may accept fees and other consideration from
the Purchase Contract Agent and any Holder of Securities without having to
account for the same to the Company; provided that each of the Securities
Intermediary and the Collateral Agent covenants and agrees with the Company that
it shall not accept, receive or permit there to be created in favor of itself
and shall take no affirmative action to permit there to be created in favor of
any other Person, any security interest, lien or other encumbrance of any kind
in or upon the Collateral other than the lien created by the Pledge.

          SECTION 9.05. NON-RELIANCE ON COLLATERAL AGENT AND SECURITIES
INTERMEDIARY. Neither the Securities Intermediary nor the Collateral Agent shall
be required to keep itself informed as to the performance or observance by the
Purchase Contract Agent or any Holder of Securities of this Agreement, the
Purchase Contract Agreement, the Securities or any other document referred to or
provided for herein or therein or to inspect the properties or books of the
Purchase Contract Agent or any Holder of Securities. Neither the Collateral
Agent nor the Securities Intermediary shall have any duty or responsibility to
provide the Company with any credit or other information concerning the affairs,
financial condition or business of the Purchase Contract Agent or any Holder of
Securities (or any of their respective affiliates) that may come into the
possession of the Collateral Agent or the Securities Intermediary or any of
their respective affiliates.

          SECTION 9.06.  COMPENSATION AND INDEMNITY.  The Company agrees to:

          (a)  pay the Collateral Agent and the Securities Intermediary from
time to time such compensation as shall be agreed in writing between the Company
and the Collateral Agent or the Securities Intermediary, as the case may be, for
all services rendered by them hereunder;

          (b)  indemnify and hold harmless the Collateral Agent, the Securities
Intermediary and each of their respective directors, officers, agents and
employees (collectively, the "INDEMNITEES"), harmless from and against any and
all claims, liabilities, losses, damages, fines, penalties and expenses
(including reasonable fees and expenses of counsel) (collectively, "Losses" and
individually, a "LOSS") that may be imposed on, incurred by, or asserted
against, the Indemnitees or any

                                       28


of them for following any instructions or other directions upon which either the
Collateral Agent or the Securities Intermediary is entitled to rely pursuant to
the terms of this Agreement; and

          (c)  in addition to and not in limitation of paragraph (b) immediately
above, indemnify and hold the Indemnitees and each of them harmless from and
against any and all Losses that may be imposed on, incurred by or asserted
against, the Indemnitees or any of them in connection with or arising out of the
Collateral Agent's or the Securities Intermediary's acceptance or performance of
its powers and duties under this Agreement, provided the Collateral Agent or the
Securities Intermediary has not acted with negligence or engaged in willful
misconduct or bad faith with respect to the specific Loss against which
indemnification is sought.

          SECTION 9.07. FAILURE TO ACT. In the event of any ambiguity in the
provisions of this Agreement or any dispute between or conflicting claims by or
among the parties hereto or any other Person with respect to any funds or
property deposited hereunder, then at its sole option, each of the Collateral
Agent and the Securities Intermediary shall be entitled, after prompt notice to
the Company and the Purchase Contract Agent, to refuse to comply with any and
all claims, demands or instructions with respect to such property or funds so
long as such dispute or conflict shall continue, and the Collateral Agent and
the Securities Intermediary shall not be or become liable in any way to any of
the parties hereto for its failure or refusal to comply with such conflicting
claims, demands or instructions. The Collateral Agent and the Securities
Intermediary shall be entitled to refuse to act until either:

          (a)  such conflicting or adverse claims or demands shall have been
finally determined by a court of competent jurisdiction or settled by agreement
between the conflicting parties as evidenced in a writing satisfactory to the
Collateral Agent or the Securities Intermediary; or

          (b)  the Collateral Agent or the Securities Intermediary shall have
received security or an indemnity satisfactory to it sufficient to save it
harmless from and against any and all loss, liability or reasonable
out-of-pocket expense which it may incur by reason of its acting.

The Collateral Agent and the Securities Intermediary may in addition elect to
commence an interpleader action or seek other judicial relief or orders as the
Collateral Agent or the Securities Intermediary may deem necessary.
Notwithstanding anything contained herein to the contrary, neither the
Collateral Agent nor the Securities Intermediary shall be required to take any
action that is in its opinion contrary to law or to the terms of this Agreement,
or which would in its opinion subject it or any of its officers, employees or
directors to liability.

                                       29


          SECTION 9.08.  RESIGNATION OF COLLATERAL AGENT AND SECURITIES
INTERMEDIARY.

          (a)  Subject to the appointment and acceptance of a successor
Collateral Agent as provided below:

                 (i)   the Collateral Agent may resign at any time by giving
          notice thereof to the Company and the Purchase Contract Agent as
          attorney-in-fact for the Holders of Securities;

                (ii)   the Collateral Agent may be removed at any time by the
          Company; and

               (iii)   if the Collateral Agent fails to perform any of its
          material obligations hereunder in any material respect for a period of
          not less than 20 days after receiving written notice of such failure
          by the Purchase Contract Agent and such failure shall be continuing,
          the Collateral Agent may be removed by the Purchase Contract Agent,
          acting at the direction of the Holders of Securities.

The Purchase Contract Agent shall promptly notify the Company of any removal of
the Collateral Agent pursuant to clause (iii) of the immediately preceding
sentence. Upon any such resignation or removal, the Company shall have the right
to appoint a successor Collateral Agent. If no successor Collateral Agent shall
have been so appointed and shall have accepted such appointment within 30 days
after the retiring Collateral Agent's giving of notice of resignation or the
Company or the Purchase Contract Agent giving notice of such removal, then the
retiring Collateral Agent may petition any court of competent jurisdiction for
the appointment of a successor Collateral Agent. The Collateral Agent shall be a
bank or a national banking association which has an office (or an agency office)
in New York City with a combined capital and surplus of at least $50,000,000 and
shall not be the Purchase Contract Agent or any of its affiliates. Upon the
acceptance of any appointment as Collateral Agent hereunder by a successor
Collateral Agent, such successor Collateral Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the retiring
Collateral Agent, and the retiring Collateral Agent shall take all appropriate
action to transfer any money and property held by it hereunder (including the
Collateral) to such successor Collateral Agent. The retiring Collateral Agent
shall, upon such succession, be discharged from its duties and obligations as
Collateral Agent hereunder. After any retiring Collateral Agent's resignation
hereunder as Collateral Agent, the provisions of this Article 9 shall continue
in effect for its benefit in respect of any actions taken or omitted to be taken
by it while it was acting as the Collateral Agent.

                                       30


          (b)  Subject to the appointment and acceptance of a successor
Securities Intermediary as provided below:

                 (i)   the Securities Intermediary may resign at any time by
          giving notice thereof to the Company and the Purchase Contract Agent
          as attorney-in-fact for the Holders of Securities;

                (ii)   the Securities Intermediary may be removed at any time by
          the Company; and

               (iii)   if the Securities Intermediary fails to perform any of
          its material obligations hereunder in any material respect for a
          period of not less than 20 days after receiving written notice of such
          failure by the Purchase Contract Agent and such failure shall be
          continuing, the Securities Intermediary may be removed by the Purchase
          Contract Agent.

The Purchase Contract Agent shall promptly notify the Company of any removal of
the Securities Intermediary pursuant to clause (iii) of the immediately
preceding sentence. Upon any such resignation or removal, the Company shall have
the right to appoint a successor Securities Intermediary. If no successor
Securities Intermediary shall have been so appointed and shall have accepted
such appointment within 30 days after the retiring Securities Intermediary's
giving of notice of resignation or the Company or the Purchase Contract Agent
giving notice of such removal, then the retiring Securities Intermediary may
petition any court of competent jurisdiction for the appointment of a successor
Securities Intermediary. The Securities Intermediary shall be a bank or a
national banking association which has an office (or an agency office) in New
York City with a combined capital and surplus of at least $50,000,000 and shall
not be the Purchase Contract Agent or any of its affiliates. Upon the acceptance
of any appointment as Securities Intermediary hereunder by a successor
Securities Intermediary, such successor Securities Intermediary shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Securities Intermediary, and the retiring Securities
Intermediary shall take all appropriate action to transfer any money and
property held by it hereunder (including the Collateral) to such successor
Securities Intermediary. The retiring Securities Intermediary shall, upon such
succession, be discharged from its duties and obligations as Securities
Intermediary hereunder. After any retiring Securities Intermediary's resignation
hereunder as Securities Intermediary, the provisions of this Article 9 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as the Securities Intermediary.

          SECTION 9.09. RIGHT TO APPOINT AGENT OR ADVISOR. The Collateral Agent
shall have the right to appoint agents or advisors in connection with any of its
duties hereunder, and the Collateral Agent shall not be liable for any action
taken

                                       31


or omitted by, or in reliance upon the advice of, such agents or advisors
selected in good faith. The appointment of agents pursuant to this Section 9.09
shall be subject to prior consent of the Company, which consent shall not be
unreasonably withheld.

          SECTION 9.10.  SURVIVAL.  The provisions of this Article 9 shall
survive termination of this Agreement and the resignation or removal of the
Collateral Agent or the Securities Intermediary.

          SECTION 9.11. EXCULPATION. Anything contained in this Agreement to the
contrary notwithstanding, in no event shall the Collateral Agent or the
Securities Intermediary or their officers, directors, employees or agents be
liable under this Agreement to any third party for indirect, special, punitive,
or consequential loss or damage of any kind whatsoever, including, but not
limited to, lost profits, whether or not the likelihood of such loss or damage
was known to the Collateral Agent or the Securities Intermediary, or any of
them.

                                   ARTICLE 10
                                    AMENDMENT

          SECTION 10.01. AMENDMENT WITHOUT CONSENT OF HOLDERS. Without the
consent of any Holders, the Company, the Collateral Agent, the Securities
Intermediary and the Purchase Contract Agent, at any time and from time to time,
may amend this Agreement, in form satisfactory to the Company, the Collateral
Agent, the Securities Intermediary and the Purchase Contract Agent, to:

          (a)  evidence the succession of another Person to the Company, and the
assumption by any such successor of the covenants of the Company;

          (b)  evidence and provide for the acceptance of appointment hereunder
by a successor Collateral Agent, Securities Intermediary or Purchase Contract
Agent;

          (c)  add to the covenants of the Company for the benefit of the
Holders, or surrender any right or power herein conferred upon the Company,
provided such covenants or such surrender do not adversely affect the validity,
perfection or priority of the Pledge created hereunder; or

          (d)  cure any ambiguity (or formal defect), correct or supplement any
provisions herein which may be inconsistent with any other such provisions
herein, or make any other provisions with respect to such matters or questions
arising under this Agreement, provided such action shall not adversely affect
the interests of the Holders.

                                       32


          SECTION 10.02. AMENDMENT WITH CONSENT OF HOLDERS. With the consent of
the Holders of not less than a majority of the Purchase Contracts at the time
outstanding, by Act of such Holders delivered to the Company, the Purchase
Contract Agent, the Securities Intermediary or the Collateral Agent, as the case
may be, the Company, when duly authorized, the Purchase Contract Agent, the
Securities Intermediary and the Collateral Agent may amend this Agreement for
the purpose of modifying in any manner the provisions of this Agreement or the
rights of the Holders in respect of the Securities; provided, however, that no
such supplemental agreement shall, without the unanimous consent of the Holders
of each Outstanding Security adversely affected thereby:

          (a)  Change the amount or type of Collateral underlying a Security
(except for the rights of holders of Stock Purchase Units to substitute the
Treasury Securities for the Pledged Preferred Securities or the Pledged
[Subordinated] Notes, as the case may be, or the rights of Holders of Treasury
Stock Purchase Units to substitute Preferred Securities or [Subordinated] Notes,
as applicable, for the Pledged Treasury Securities), impair the right of the
Holder of any Security to receive distributions on the underlying Collateral or
otherwise adversely affect the Holder's rights in or to such Collateral; or

          (b)  otherwise effect any action that would require the consent of the
Holder of each Outstanding Security affected thereby pursuant to the Purchase
Contract Agreement if such action were effected by an agreement supplemental
thereto; or

          (c)  reduce the percentage of Purchase Contracts the consent of whose
Holders is required for any such amendment;

provided that if any amendment or proposal referred to above would adversely
affect only the Stock Purchase Units or only the Treasury Stock Purchase Units,
then only the affected class of Holders as of the record date for the Holders
entitled to vote thereon will be entitled to vote on such amendment or proposal,
and such amendment or proposal shall not be effective except with the consent of
Holders of not less than a majority of such class; provided, further, that the
unanimous consent of the Holders of each outstanding Purchase Contract of such
class affected thereby shall be required to approve any amendment or proposal
specified in clauses (a) through (c) above.

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

          SECTION 10.03. EXECUTION OF AMENDMENTS. In executing any amendment
permitted by this Section, the Collateral Agent, the Securities Intermediary and

                                       33


the Purchase Contract Agent shall be entitled to receive and (subject to Section
7.01 of the Purchase Contract Agreement with respect to the Purchase Contract
Agent) shall be fully protected in relying upon, an Opinion of Counsel stating
that the execution of such amendment is authorized or permitted by this
Agreement and that all conditions precedent, if any, to the execution and
delivery of such amendment have been satisfied.

          SECTION 10.04. EFFECT OF AMENDMENTS. Upon the execution of any
amendment under this Section, this Agreement shall be modified in accordance
therewith, and such amendment shall form a part of this Agreement for all
purposes; and every Holder of Certificates theretofore or thereafter
authenticated, executed on behalf of the Holders and delivered under the
Purchase Contract Agreement shall be bound thereby.

          SECTION 10.05. REFERENCE OF AMENDMENTS. Certificates authenticated,
executed on behalf of the Holders and delivered after the execution of any
amendment pursuant to this Section may, and shall if required by the Collateral
Agent or the Purchase Contract Agent, bear a notation in form approved by the
Purchase Contract Agent and the Collateral Agent as to any matter provided for
in such amendment. If the Company shall so determine, new Security Certificates
so modified as to conform, in the opinion of the Collateral Agent, the Purchase
Contract Agent and the Company, to any such amendment may be prepared and
executed by the Company and authenticated, executed on behalf of the Holders and
delivered by the Purchase Contract Agent in accordance with the Purchase
Contract Agreement in exchange for Outstanding Security Certificates.

                                   ARTICLE 11
                                  MISCELLANEOUS

          SECTION 11.01. NO WAIVER. No failure on the part of the Collateral
Agent, the Securities Intermediary or any of their respective agents to
exercise, and no course of dealing with respect to, and no delay in exercising,
any right, power or remedy hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise by the Collateral Agent, the Securities
Intermediary or any of their respective agents of any right, power or remedy
hereunder preclude any other or further exercise thereof or the exercise of any
other right, power or remedy. The remedies herein are cumulative and are not
exclusive of any remedies provided by law.

          SECTION 11.02. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. The Company,
the Collateral Agent, the Securities Intermediary and the Holders from time to
time of the Securities, acting

                                       34


through the Purchase Contract Agent as their attorney-in-fact, hereby submit to
the nonexclusive jurisdiction of the United States District Court for the
Southern District of New York and of any New York state court sitting in New
York City for the purposes of all legal proceedings arising out of or relating
to this Agreement or the transactions contemplated hereby. The Company, the
Collateral Agent, the Securities Intermediary and the Holders from time to time
of the Securities, acting through the Purchase Contract Agent as their
attorney-in-fact, irrevocably waive, to the fullest extent permitted by
applicable law, any objection which they may now or hereafter have to the laying
of the venue of any such proceeding brought in such a court and any claim that
any such proceeding brought in such a court has been brought in an inconvenient
forum.

          SECTION 11.03. NOTICES. All notices, requests, consents and other
communications provided for herein (including, without limitation, any
modifications of, or waivers or consents under, this Agreement) shall be given
or made in writing (including, without limitation, by telecopy) delivered to the
intended recipient at the "ADDRESS FOR NOTICES" specified below its name on the
signature pages hereof or, as to any party, at such other address as shall be
designated by such party in a notice to the other parties. Except as otherwise
provided in this Agreement, all such communications shall be deemed to have been
duly given when transmitted by telecopier or personally delivered or, in the
case of a mailed notice, upon receipt, in each case given or addressed as
aforesaid.

          SECTION 11.04. SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the respective successors and assigns of the
Company, the Collateral Agent, the Securities Intermediary and the Purchase
Contract Agent, and the Holders from time to time of the Securities, by their
acceptance of the same, shall be deemed to have agreed to be bound by the
provisions hereof and to have ratified the agreements of, and the grant of the
Pledge hereunder by, the Purchase Contract Agent.

          SECTION 11.05. COUNTERPARTS. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument, and any of the parties hereto may execute this Agreement by
signing any such counterpart.

          SECTION 11.06. SEVERABILITY. If any provision hereof is invalid and
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(i) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in order to carry out the
intentions of the parties hereto as nearly as may be possible and (ii) the
invalidity or unenforceability of any provision hereof in any jurisdiction shall
not affect the validity or enforceability of such provision in any other
jurisdiction.

                                       35


          SECTION 11.07. EXPENSES, ETC.. The Company agrees to reimburse the
Collateral Agent and the Securities Intermediary for:

          (a)  all reasonable costs and expenses of the Collateral Agent and the
Securities Intermediary (including, without limitation, the reasonable fees and
expenses of counsel to the Collateral Agent and the Securities Intermediary), in
connection with (i) the negotiation, preparation, execution and delivery or
performance of this Agreement and (ii) any modification, supplement or waiver of
any of the terms of this Agreement;

          (b)  all reasonable costs and expenses of the Collateral Agent and the
Securities Intermediary (including, without limitation, reasonable fees and
expenses of counsel) in connection with (i) any enforcement or proceedings
resulting or incurred in connection with causing any Holder of Securities to
satisfy its obligations under the Purchase Contracts forming a part of the
Securities and (ii) the enforcement of this Section 11.07;

          (c)  all transfer, stamp, documentary or other similar taxes,
assessments or charges levied by any governmental or revenue authority in
respect of this Agreement or any other document referred to herein and all
costs, expenses, taxes, assessments and other charges incurred in connection
with any filing, registration, recording or perfection of any security interest
contemplated hereby;

          (d)  all fees and expenses of any agent or advisor appointed by the
Collateral Agent and consented to by the Company under Sections 9.03 and 9.09 of
this Agreement; and

          (e)  any other out-of-pocket costs and expenses reasonably incurred by
the Collateral Agent and the Securities Intermediary in connection with the
performance of their duties hereunder.

          SECTION 11.08. SECURITY INTEREST ABSOLUTE. All rights of the
Collateral Agent and security interests hereunder, and all obligations of the
Holders from time to time hereunder, shall be absolute and unconditional
irrespective of:

          (a)  any lack of validity or enforceability of any provision of the
Purchase Contracts or the Securities or any other agreement or instrument
relating thereto;

          (b)  any change in the time, manner or place of payment of, or any
other term of, or any increase in the amount of, all or any of the obligations
of Holders of the Securities under the related Purchase Contracts, or any other
amendment or waiver of any term of, or any consent to any departure from any
requirement of, the Purchase Contract Agreement or any Purchase Contract or any
other agreement or instrument relating thereto; or

                                       36


          (c)  any other circumstance which might otherwise constitute a defense
available to, or discharge of, a borrower, a guarantor or a pledger.

          SECTION 11.09. NOTICE OF TAX EVENT, TAX EVENT REDEMPTION AND
TERMINATION EVENT. Upon the occurrence of a Tax Event, a Tax Event Redemption or
a Termination Event, the Company shall deliver written notice to the Collateral
Agent and the Securities Intermediary. Upon the written request of the
Collateral Agent or the Securities Intermediary, the Company shall inform such
party whether or not a Tax Event, a Tax Event Redemption or a Termination Event
has occurred.

                       [SIGNATURES ON THE FOLLOWING PAGE]

                                       37


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

CINERGY CORP.                                   [                      ] as
                                                Purchase Contract Agent and
                                                as attorney-in-fact of the
                                                Holders from time to time of
                                                the Securities


By:                                             By:
   -----------------------------                   -----------------------------
    Name:                                           Name:
    Title:                                          Title:

Address for Notices:                            Address for Notices:

Cinergy Corp.                                   [                      ]
139 East Fourth Street                          [                      ]
Cincinnati, OH 45202                            [                      ]
Attention:                                      Attention:
Telecopy:                                       Telecopy:

With a copy to:
[                      ]
[                      ]
[                      ]
Attention:
Telecopy:

                                       38


[                      ]                        [                      ]
as Collateral Agent                             as Securities Intermediary

By:                                             By:
   -----------------------------                   -----------------------------
    Name:                                           Name:
    Title:                                          Title:

Address for Notices:                            Address for Notices:

[                      ]                        [                      ]
[                      ]                        [                      ]
[                      ]                        [                      ]
[                      ]                        [                      ]
[                      ]                        [                      ]
Attention:                                      Attention:
Telecopy:                                       Telecopy:

                                       39


                                                                       EXHIBIT A

                                   INSTRUCTION
                          FROM PURCHASE CONTRACT AGENT
                               TO COLLATERAL AGENT
                (Establishment of Treasury Stock Purchase Units)

[                      ]
[                      ]
[                      ]
[                      ]
[                      ]
Attention:
Telecopy:

     Re:    Stock Purchase Units of Cinergy Corp.
            (the "COMPANY") and CC Funding Trust II

            The securities account of [                            ], as
            Collateral Agent, maintained by the Securities Intermediary and
            designated "[                            ], as Collateral Agent of
            Cinergy Corp., as pledgee of [           ], as the Purchase Contract
            Agent on behalf of and as attorney-in-fact for the Holders" (the
            "COLLATERAL ACCOUNT")

          Please refer to the Pledge Agreement, dated as of __________, 2003
(the "PLEDGE AGREEMENT"), among the Company, you, as Collateral Agent, [
          ], as Securities Intermediary, and the undersigned, as Purchase
Contract Agent and as attorney-in-fact for the holders of Stock Purchase Units
from time to time. Capitalized terms used herein but not defined shall have the
meaning set forth in the Pledge Agreement.

          We hereby notify you in accordance with Section 5.02 of the Pledge
Agreement that the holder of securities named below (the "HOLDER") has elected
to substitute $__________ Value of Treasury Securities or security entitlements
thereto in exchange for [an equal Value of [Pledged Preferred Securities]
[Pledged [Subordinated] Notes] relating to _________ Stock Purchase Units] and
has delivered to the undersigned a notice stating that the Holder has
Transferred such Treasury Securities or security entitlements thereto to the
Securities Intermediary, for credit to the Collateral Account.

          We hereby request that you instruct the Securities Intermediary, upon
confirmation that such Treasury Securities or security entitlements thereto have

                                       A-1


been credited to the Collateral Account, to release to the undersigned [an equal
Value of [Pledged Preferred Securities] [Pledged [Subordinated] Notes]] in
accordance with Section 5.02 of the Pledge Agreement. We also hereby confirm
that no Tax Event Redemption has occurred.

                                                [                             ],
Date:                                           as Purchase Contract Agent and
                                                as attorney-in-fact of the
                                                Holders from time to time of the
                                                Securities


                                                By:
                                                   -----------------------------
                                                   Name:
                                                   Title:

                                       A-2


Please print name and address of Holder electing to substitute Treasury
Securities or security entitlements thereto for the [Pledged Preferred
Securities] [Pledged [Subordinated] Notes]:


- --------------------------------         --------------------------------
              Name                       Social Security or other
                                         Taxpayer Identification Number,
                                         if any

- --------------------------------
             Address

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

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

                                       A-3


                                                                       EXHIBIT B

                                   INSTRUCTION
                              FROM COLLATERAL AGENT
                           TO SECURITIES INTERMEDIARY
                (Establishment of Treasury Stock Purchase Units)

[                      ]
[                      ]
[                      ]
[                      ]
[                      ]
[                      ]
Attention:
Telecopy:

Re:       Stock Purchase Units of Cinergy Corp. (the
          "COMPANY") and CC Funding Trust II

          The securities account of [                            ], as
          Collateral Agent, maintained by the Securities Intermediary and
          designated "[                            ], as Collateral Agent of
          Cinergy Corp., as pledgee of [                            ], as the
          Purchase Contract Agent on behalf of and as attorney-in-fact for the
          Holders" (the "COLLATERAL ACCOUNT")

          Please refer to the Pledge Agreement, dated as of _________________,
2003 (the "PLEDGE AGREEMENT"), among the Company, you, as Securities
Intermediary, [                          ], as Purchase Contract Agent and as
attorney-in-fact for the holders of Stock Purchase Units from time to time, and
the undersigned, as Collateral Agent. Capitalized terms used herein but not
defined shall have the meanings set forth in the Pledge Agreement.

          When you have confirmed that $__________ Value of Treasury Securities
or security entitlements thereto has been credited to the Collateral Account by
or for the benefit of _________, as Holder of Stock Purchase Units (the
"HOLDER"), you are hereby instructed to release from the Collateral Account [an
equal Value of [Preferred Securities or security entitlements thereto]
[[Subordinated] Notes or

                                       B-1


security entitlements thereto]] relating to _____ Stock Purchase Units of the
Holder] by Transfer to the Purchase Contract Agent.

                                          [                             ],
                                          as Collateral Agent

Date:
     -----------------


                                          By:
                                             -----------------------------
                                              Name:
                                              Title:

                                       B-2


Please print name and address of Holder:


- --------------------------------                --------------------------------
              Name                              Social Security or other
                                                Taxpayer Identification Number,
                                                if any


- --------------------------------
             Address

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

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

                                       B-3


                                                                       EXHIBIT C

                                   INSTRUCTION
                          FROM PURCHASE CONTRACT AGENT
                               TO COLLATERAL AGENT
                   (Reestablishment of Stock Purchase Units )

[                      ]
[                      ]
[                      ]
[                      ]
[                      ]
[                      ]
Attention:
Telecopy:

          Re:    _______________ Stock Purchase Units of Cinergy Corp. (the
                 "COMPANY") and CC Funding Trust II

          Please refer to the Pledge Agreement dated as of __________, 2003 (the
"PLEDGE AGREEMENT"), among the Company, you, as Collateral Agent, [
     ], as Securities Intermediary, and the undersigned, as Purchase Contract
Agent and as attorney-in-fact for the holders of Stock Purchase Units from time
to time. Capitalized terms used herein but not defined shall have the meaning
set forth in the Pledge Agreement.

          We hereby notify you in accordance with Section 5.03(a) of the Pledge
Agreement that the holder of securities listed below (the "HOLDER") has elected
to substitute [$                 Value of [Preferred Securities or security
entitlements thereto] [[Subordinated] Notes or security entitlements thereto]]
in exchange for $__________ Value of Pledged Treasury Securities and has
delivered to the undersigned a notice stating that the holder has Transferred
such [Preferred Securities or security entitlements thereto] [[Subordinated]
Notes or security entitlements thereto] to the Securities Intermediary, for
credit to the Collateral Account.

          We hereby request that you instruct the Securities Intermediary, upon
confirmation that such [Preferred Securities or security entitlements thereto]
[[Subordinated] Notes or security entitlements thereto] have been credited to
the Collateral Account, to release to the undersigned $__________ Value of
Treasury Securities or security entitlements thereto related to _____ Stock
Purchase Units

                                       C-1


of such Holder in accordance with Section 5.03(a) of the Pledge Agreement. We
also hereby confirm that no Tax Event Redemption has occurred.

                                                [                             ],
                                                as Purchase Contract Agent


Date:                                           By:
     -----------------                             -----------------------------
                                                    Name:
                                                    Title:

                                       C-2


Please print name and address of Holder electing to substitute [Preferred
Securities or security entitlements thereto] [Pledged [Subordinated] Notes or
security entitlements thereto] for Pledged Treasury Securities:


- --------------------------------                --------------------------------
              Name                              Social Security or other
                                                Taxpayer Identification Number,
                                                if any


- --------------------------------
             Address

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

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

                                       C-3


                                                                       EXHIBIT D

                                   INSTRUCTION
                              FROM COLLATERAL AGENT
                           TO SECURITIES INTERMEDIARY
                    (Reestablishment of Stock Purchase Units)

[                      ]
[                      ]
[                      ]
[                      ]
[                      ]
[                      ]
Attention:
Telecopy:

          Re:    _______________ Stock Purchase Units of Cinergy Corp.
                 (the "COMPANY") and CC Funding Trust II

                 The securities account of [                            ], as
                 Collateral Agent, maintained by the Securities Intermediary
                 and designated "[                    ], as Collateral Agent
                 of Cinergy Corp., as pledgee of [                         ],
                 as the Purchase Contract Agent on behalf of and as
                 attorney-in-fact for the Holders" (the "COLLATERAL ACCOUNT")

          Please refer to the Pledge Agreement dated as of _________________,
2003 (the "PLEDGE AGREEMENT"), among the Company, you, as Securities
Intermediary, [                           ], as Purchase Contract Agent and as
attorney-in-fact for the holders of Stock Purchase Units from time to time, and
the undersigned, as Collateral Agent. Capitalized terms used herein but no
defined shall have the meaning set forth in the Pledge Agreement.

          When you have confirmed that $ __________ Value of [Preferred
Securities or security entitlements thereto] [[Subordinated] Notes or security
entitlements thereto] has been credited to the Collateral Account by or for the
benefit of ________________, as Holder of Stock Purchase Units (the "HOLDER"),
you are hereby instructed to release from the Collateral Account $

                                       D-1


________________ Value of Treasury Securities or security entitlements thereto
by Transfer to the Purchase Contract Agent.

                                                [                             ],
                                                as Collateral Agent


Date:                                           By:
     -----------------                             -----------------------------
                                                    Name:
                                                    Title:


- --------------------------------                --------------------------------
              Name                              Social Security or other
                                                Taxpayer Identification Number,
                                                if any


- --------------------------------
             Address

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

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

                                       D-2


                                                                       EXHIBIT E

                    NOTICE OF CASH SETTLEMENT FROM SECURITIES
                     INTERMEDIARY TO PURCHASE CONTRACT AGENT
                            (Cash Settlement Amounts)

[                      ]
[                      ]
[                      ]
Attention:
Telecopy:

          Re:    _______________ Stock Purchase Units of Cinergy Corp.
                 (the "COMPANY") and CC Funding Trust II

          Please refer to the Pledge Agreement dated as of _______________, 2003
(the "PLEDGE AGREEMENT"), by and among you, the Company, [                    ],
as Collateral Agent and the undersigned, as Securities Intermediary. Unless
otherwise defined herein, terms defined in the Pledge Agreement are used herein
as defined therein.

          In accordance with Section 5.05(d) of the Pledge Agreement, we hereby
notify you that as of 11:00 a.m. (New York City time) on the fifth Business Day
immediately preceding ___________, we have received (i) $ _______________ in
immediately available funds paid in an aggregate amount equal to the Purchase
Price to the Company on the Purchase Contract Settlement Date with respect to
________________ Stock Purchase Units and (ii) $ ___________ in immediately
available funds paid in an aggregate amount equal to the Purchase Price to the
Company on the Purchase Contract Settlement Date with respect to ______ Treasury
Stock Purchase Units.

                                                [                             ],
                                                as Securities Intermediary,

Date:                                           By:
     -----------------                             -----------------------------
                                                    Name:
                                                    Title:

                                      E-1

EX-5.1

                                                                     EXHIBIT 5.1


                        Taft, Stettinius & Hollister LLP
                          425 Walnut Street, Suite 1800
                            Cincinnati, OH 45202-3957
                                 (513) 381-2838
                               Fax: (513) 381-0205
                                 www.taftlaw.com





                                January 15, 2003


Cinergy Corp.
139 East Fourth Street
Cincinnati, OH 45202

Ladies and Gentlemen:

         We have acted as counsel in connection with the Registration Statement
on Form S-3 (the "REGISTRATION STATEMENT") filed by Cinergy Corp. (the
"COMPANY") and CC Funding Trust II, a statutory trust established by the Company
under the laws of the State of Delaware (the "TRUST"), with the Securities and
Exchange Commission pursuant to the Securities Act of 1933, as amended (the
"SECURITIES ACT"), for the registration of the sale by the Company from time to
time of up to $750,000,000 aggregate principal amount of (i) shares of its
common stock, par value $.01 per share (the "COMMON STOCK"), (ii) shares of its
preferred stock, par value $.01 per share (the "PREFERRED STOCK"), (iii) stock
purchase contracts (the "STOCK PURCHASE CONTRACTS") to purchase or sell shares
of Common Stock, (iv) unsecured senior and junior subordinated debt securities
(the "DEBT SECURITIES"), (v) stock purchase units (the "STOCK PURCHASE UNITS"),
consisting of a Stock Purchase Contract and either trust preferred securities
issued by the Trust (the "TRUST SECURITIES"), Debt Securities or other third
party debt obligations, and (vi) guarantees of payment with respect to the Trust
Securities (the "GUARANTEES"). Capitalized terms used herein but not defined
have the same meanings as provided in the Registration Statement.

         The Debt Securities are to be issued pursuant to an Indenture dated
September 12, 2001, between the Company and Fifth Third Bank, as trustee, to be
supplemented by a supplemental indenture thereto (the "INDENTURE"). The
Guarantees are to be issued pursuant to a guarantee agreement to be entered into
between the Company and The Bank of New York, as guarantee trustee (the
"GUARANTEE AGREEMENT"). The Stock Purchase Contracts are to be issued pursuant
to a purchase contract agreement to be entered into between the Company and a
purchase contract agent (the "PURCHASE CONTRACT AGREEMENT").





         We have examined the originals or copies certified or otherwise
identified to our satisfaction of such corporate records of the Company and such
other documents and certificates as we have deemed necessary as a basis for the
opinions hereinafter expressed.

         Based on the foregoing, we are of the opinion that:

         (1) When necessary corporate action on the part of the Company has been
taken to authorize the issuance and sale of such shares of Common Stock proposed
to be sold by the Company, and when such shares of Common Stock are issued and
delivered in accordance with the applicable underwriting or other agreement,
such shares of Common Stock will be validly issued, fully paid and
nonassessable.

         (2) Upon designation of the relative rights, preferences and
limitations of any series of Preferred Stock by or on behalf of the Board of
Directors of the Company and the proper filing with the Secretary of State of
the State of Delaware of a Certificate of Designation relating to such series of
Preferred Stock, all necessary corporate action on the part of the company will
have been taken to authorize the issuance and sale of such series of Preferred
Stock proposed to be sold by the Company, and when such shares of Preferred
Stock are issued and delivered in accordance with the applicable underwriting or
other agreement, such shares of Preferred Stock will be validly issued, fully
paid and nonassessable, enforceable in accordance with their terms, except as
(a) the enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or similar laws now or hereafter
in effect relating to or affecting the enforcement of creditors' rights
generally and (b) the availability of equitable remedies may be limited by
equitable principles of general applicability (regardless of whether considered
in a proceeding at law or in equity).

         (3) When any supplemental Indenture to be entered into in connection
with the issuance of any Debt Security has been duly authorized, executed and
delivered by the trustee and the Company, the specific terms of a particular
Debt Security have been duly authorized and established in accordance with the
applicable supplemental Indenture and such Debt Security has been duly
authorized, executed, authenticated, issued and delivered in accordance with the
applicable supplemental Indenture and the applicable underwriting or other
agreement, such Debt Security will constitute a valid and binding obligation of
the Company, enforceable in accordance with its terms, except as (a) the
enforceability thereof may be limited by bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium or similar laws now or hereinafter in effect
relating to or affecting the enforcement of creditors' rights generally and (b)
the availability of equitable remedies may be limited by equitable principles of
general applicability (regardless of whether considered in a proceeding at law
or in equity).

         (4) When the Guarantees have been duly authorized by the Company, the
applicable Guarantee Agreement has been duly executed and delivered and the
Trust Securities have been duly issued and delivered by the Trust as
contemplated by the Registration Statement and any prospectus supplement
relating thereto, the Guarantees will constitute valid and binding obligations
of the Company, enforceable in accordance with their terms, except as (a) the
enforceability thereof may be limited by bankruptcy, insolvency, reorganization,
fraudulent






transfer, moratorium or similar laws now or hereinafter in effect relating to or
affecting the enforcement of creditors' rights generally and (b) the
availability of equitable remedies may be limited by equitable principles of
general applicability (regardless of whether considered in a proceeding at law
or in equity).

         (5) When the Stock Purchase Units and Stock Purchase Contracts have
been duly authorized by the Company, and the applicable Purchase Contract
Agreement and Pledge Agreement have been duly executed and delivered, the Stock
Purchase Units and Stock Purchase Contracts will constitute valid and binding
obligations of the Company, enforceable in accordance with their terms, except
as (a) the enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or similar laws now or
hereinafter in effect relating to or affecting the enforcement of creditors'
rights generally and (b) the availability of equitable remedies may be limited
by equitable principles of general applicability (regardless of whether
considered in a proceeding at law or in equity).

         The foregoing opinion is limited to the laws of the State of New York
(which law, by their terms, governs certain of the above-referenced agreements),
the federal laws of the United States of America and the General Corporation Law
of the State of Delaware.

         We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement referred to above, and further consent to the reference
to our name under the caption "Legal Matters" in the Prospectus which is part of
the Registration Statement, without admitting that we are experts within the
meaning of the Securities Act.

                                         Very truly yours,


                                        /s/ TAFT, STETTINIUS & HOLLISTER LLP

EX-5.2

                                                                     EXHIBIT 5.2

                            RICHARDS, LAYTON & FINGER
                           A PROFESSIONAL ASSOCIATION
                                ONE RODNEY SQUARE
                                  P.O. BOX 551
                           WILMINGTON, DELAWARE 19899
                                 (302) 651-7700
                               FAX: (302) 651-7701
                                   WWW.RLF.COM


                                January 15, 2003


Cinergy Corp.
139 East Fourth Street
Cincinnati, Ohio 45202

         Re: CC Funding Trust II

Ladies and Gentlemen:

         We have acted as special Delaware counsel for CC Funding Trust II, a
Delaware statutory trust (the "Trust") in connection with the matters set forth
herein. At your request, this opinion is being furnished to you.

         For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:

              (a) The Certificate of Trust of the Trust, as filed with the
office of the Secretary of State of the State of Delaware (the "Secretary of
State") on January 9, 2003;

              (b) The Declaration of Trust of the Trust, dated as of January 9,
2003, among Cinergy Corp., a Delaware corporation (the "Company"), and the
trustees named therein;

              (c) The Registration Statement (the "Registration Statement") on
Form S-3, including a preliminary prospectus (the "Prospectus") with respect to,
among other things, the Preferred Trust Securities of the Trust representing
preferred undivided beneficial interests in the Trust (each, a "Preferred
Security" and collectively, the "Preferred Securities"), as filed by the Company
and the Trust with the Securities and Exchange Commission on or about January15,
2003.

              (d) A form of Amended and Restated Declaration of Trust (the
"Declaration") for the Trust, to be entered into between the Company, the
trustees of the Trust named therein, and the holders, from time to time, of the
Preferred Securities (including the Exhibits thereto), attached as an exhibit to
the Registration Statement; and

              (e) A Certificate of Good Standing for the Trust, dated January
13, 2002, obtained from the Secretary of State.




Cinergy Corp
January 15, 2003
Page 2


         Initially capitalized terms used herein and not otherwise defined are
used as defined in the Declaration.

         For purposes of this opinion, we have not reviewed any documents other
than the documents listed in paragraphs (a) through (e) above. In particular, we
have not reviewed any document (other than the documents listed in paragraphs
(a) through (e) above) that is referred to in or incorporated by reference into
the documents reviewed by us. We have assumed that there exists no provision in
any document that we have not reviewed that is inconsistent with the opinions
stated herein. We have conducted no independent factual investigation of our own
but rather have relied solely upon the foregoing documents, the statements and
information set forth therein and the additional matters recited or assumed
herein, all of which we have assumed to be true, complete and accurate in all
material respects.

         With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.

         For purposes of this opinion, we have assumed (i) that the Declaration
will constitute the entire agreement among the parties thereto with respect to
the subject matter thereof, including with respect to the creation, operation
and termination of the Trust, and that the Declaration and the Certificate of
Trust will be in full force and effect and will not be amended, (ii) except to
the extent provided in paragraph 1 below, the due organization or due formation,
as the case may be, and valid existence in good standing of each party to the
documents examined by us under the laws of the jurisdiction governing its
organization or formation, (iii) the legal capacity of natural persons who are
parties to the documents examined by us, (iv) that each of the parties to the
documents examined by us has the power and authority to execute and deliver, and
to perform its obligations under, such documents, (v) the due authorization,
execution and delivery by all parties thereto of all documents examined by us,
(vi) the receipt by each Person to whom a Preferred Security is to be issued by
the Trust (collectively, the "Preferred Security Holders") of a Preferred
Security Certificate for such Preferred Security and the payment for such
Preferred Security, in accordance with the Declaration and the Prospectus, and
(vii) that the Preferred Securities will be authenticated, issued and sold to
the Preferred Security Holders in accordance with the Declaration and the
Prospectus. We have not participated in the preparation of the Registration
Statement or the Prospectus and assume no responsibility for their contents.

         This opinion is limited to the laws of the State of Delaware (excluding
the securities laws of the State of Delaware), and we have not considered and
express no opinion on the laws of any other jurisdiction, including federal laws
and rules and regulations relating thereto. Our opinions are rendered only with
respect to Delaware laws and rules, regulations and orders thereunder which are
currently in effect.

         Based upon the foregoing, and upon our examination of such questions of
law and statutes of the State of Delaware as we have considered necessary or
appropriate,





Cinergy Corp
January 15, 2003
Page 3


and subject to the assumptions, qualifications, limitations and exceptions set
forth herein, we are of the opinion that:

         1. The Trust has been duly created and is validly existing in good
standing as a statutory trust under the Statutory Trust Act.

         2. The Preferred Securities of the Trust will represent valid and,
subject to the qualifications set forth in paragraph 3 below, fully paid and
nonassessable beneficial interests in the assets of the Trust.

         3. The Preferred Security Holders, as beneficial owners of the Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Preferred Security
Holders may be obligated to make payments as set forth in the Declaration.

         We consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Registration Statement. We hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus. In giving the foregoing consents, we do not thereby admit that we
come within the category of persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission thereunder.

                                           Very truly yours,


                                           /s/Richards, Layton & Finger, P.A.

EAM/wrm

EX-12.1

                                                                    EXHIBIT 12.1

                                  CINERGY CORP.

              COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND
        RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS



                                                                                        12 MONTHS ENDED DECEMBER 31
                                                   9 MONTHS ENDED    -------------------------------------------------------------
                                                 SEPTEMBER 30, 2002      2001         2000         1999         1998        1997
                                                 ------------------   ----------   ----------   ----------   ----------  ----------
                                                                                       (THOUSANDS, EXCEPT RATIOS)
                                                                                                       
Earnings Available
  Net Income                                             $  271,279   $  442,279   $  399,466   $  403,641   $  260,968  $  362,638
  Plus:
    Preferred Dividends of Subsidiary Trust(a)               17,847        1,067           --           --           --          --
    Preferred Dividends                                       2,575        3,433        4,585        5,457        6,517      12,569
    Income Taxes                                            121,299      255,506      251,557      208,671      117,187     213,000
    Interest on Long-Term Debt                              180,685      218,939      205,748      205,798      183,849     181,772
    Other Interest                                           19,742       63,142       26,914       34,610       67,219      59,947
    Interest Component of Rents(b)                           10,479       13,971       13,500       13,147       10,760      10,482
                                                  ---------------------------------------------------------------------------------
      Total Available                                    $  623,906   $  998,337   $  901,770   $  871,324   $  646,500  $  840,408
                                                  =================================================================================

Fixed Charges
  Interest Charges                                       $  200,427   $  282,081   $  232,662   $  240,408   $  251,068  $  241,719
  Interest Component of Rents(b)                             10,479       13,971       13,500       13,147       10,760      10,482
  Preferred Dividends of Subsidiary Trust(a)                 17,847        1,067           --           --           --          --
                                                  ---------------------------------------------------------------------------------
      Total Fixed Charges                                $  228,753   $  297,119   $  246,162   $  253,555   $  261,828  $  252,201
                                                  =================================================================================

Ratio of Earnings to Fixed Charges                             2.73         3.36         3.66         3.44         2.47        3.33
                                                  =================================================================================

Fixed Charges
  Interest Charges                                       $  200,427   $  282,081   $  232,662   $  240,408   $  251,068  $  241,719
  Interest Component of Rents(b)                             10,479       13,971       13,500       13,147       10,760      10,482
  Preferred Dividends of Subsidiary Trust(a)                 17,847        1,067           --           --           --          --
  Preferred dividends (pre-income tax basis)                  3,715        5,401        7,439        8,240        9,373      19,705
                                                  ---------------------------------------------------------------------------------
      Total Fixed Charges                                $  232,468   $  302,520   $  253,601   $  261,795   $  271,201  $  271,906
                                                  =================================================================================

Ratio of Earnings to Fixed Charges and Preferred
  Stock Dividends (pre-income tax basis)                       2.68         3.30         3.56         3.33         2.38        3.09
                                                  =================================================================================


- ---------------
(a)  Preferred Dividends of Subsidiary Trust are deductible for tax purposes.
(b)  Estimated interest component of rentals (1/3 of rentals was used where no
     readily defined interest element could be determined).

EX-24.1

                                                                    EXHIBIT 24.1

                                POWER OF ATTORNEY

     KNOW ALL BY THESE PRESENTS, that the undersigned officer and director of
Cinergy Corp. hereby constitutes and appoints R. Foster Duncan,
Ronald R. Reising, Wendy L. Aumiller, Marc E. Manly, Jerome A. Vennemann and
Julia S. Janson, and each of them, with full power to act without the other, the
undersigned's true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for the undersigned and in the undersigned's
name, place and stead, in any and all capacities, to sign one or more
Registration Statements on Form S-3 relating to up to $750,000,000 of securities
of Cinergy Corp. and CC Funding Trust II, any and all amendments thereto
(including post-effective amendments), and any subsequent Registration
Statements pursuant to Rule 462 of the Securities Act of 1933 and amendments
thereto, and to file the same, with all exhibits and schedules thereto and other
documents in connection therewith, 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
desirable to be done in and about the premises, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned officer and director has caused this
Power of Attorney to be executed as of this 2nd day of December, 2002.


                                             /s/ James E. Rogers
                                             -------------------
                                             James E. Rogers



                                POWER OF ATTORNEY

     KNOW ALL BY THESE PRESENTS, that the undersigned director of Cinergy Corp.
hereby constitutes and appoints R. Foster Duncan, Ronald R. Reising,
Wendy L. Aumiller, Marc E. Manly, Jerome A. Vennemann and Julia S. Janson, and
each of them, with full power to act without the other, the undersigned's true
and lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for the undersigned and in the undersigned's name, place and
stead, in any and all capacities, to sign one or more Registration Statements on
Form S-3 relating to up to $750,000,000 of securities of Cinergy Corp. and CC
Funding Trust II, any and all amendments thereto (including post-effective
amendments), and any subsequent Registration Statements pursuant to Rule 462 of
the Securities Act of 1933 and amendments thereto, and to file the same, with
all exhibits and schedules thereto and other documents in connection therewith,
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 desirable to be done in
and about the premises, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned director has caused this Power of
Attorney to be executed as of this 2nd day of December, 2002.


                                             /s/ Michael G. Browning
                                             -----------------------
                                             Michael G. Browning



                                POWER OF ATTORNEY

     KNOW ALL BY THESE PRESENTS, that the undersigned director of Cinergy Corp.
hereby constitutes and appoints R. Foster Duncan, Ronald R. Reising,
Wendy L. Aumiller, Marc E. Manly, Jerome A. Vennemann and Julia S. Janson, and
each of them, with full power to act without the other, the undersigned's true
and lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for the undersigned and in the undersigned's name, place and
stead, in any and all capacities, to sign one or more Registration Statements on
Form S-3 relating to up to $750,000,000 of securities of Cinergy Corp. and CC
Funding Trust II, any and all amendments thereto (including post-effective
amendments), and any subsequent Registration Statements pursuant to Rule 462 of
the Securities Act of 1933 and amendments thereto, and to file the same, with
all exhibits and schedules thereto and other documents in connection therewith,
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 desirable to be done in
and about the premises, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned director has caused this Power of
Attorney to be executed as of this 2nd day of December, 2002.


                                             /s/ Phillip R. Cox
                                             ------------------
                                             Phillip R. Cox



                                POWER OF ATTORNEY

     KNOW ALL BY THESE PRESENTS, that the undersigned director of Cinergy Corp.
hereby constitutes and appoints R. Foster Duncan, Ronald R. Reising,
Wendy L. Aumiller, Marc E. Manly, Jerome A. Vennemann and Julia S. Janson, and
each of them, with full power to act without the other, the undersigned's true
and lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for the undersigned and in the undersigned's name, place and
stead, in any and all capacities, to sign one or more Registration Statements on
Form S-3 relating to up to $750,000,000 of securities of Cinergy Corp. and CC
Funding Trust II, any and all amendments thereto (including post-effective
amendments), and any subsequent Registration Statements pursuant to Rule 462 of
the Securities Act of 1933 and amendments thereto, and to file the same, with
all exhibits and schedules thereto and other documents in connection therewith,
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 desirable to be done in
and about the premises, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned director has caused this Power of
Attorney to be executed as of this 2nd day of December, 2002.


                                             /s/ George C. Juilfs
                                             --------------------
                                             George C. Juilfs



                                POWER OF ATTORNEY

     KNOW ALL BY THESE PRESENTS, that the undersigned director of Cinergy Corp.
hereby constitutes and appoints R. Foster Duncan, Ronald R. Reising,
Wendy L. Aumiller, Marc E. Manly, Jerome A. Vennemann and Julia S. Janson, and
each of them, with full power to act without the other, the undersigned's true
and lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for the undersigned and in the undersigned's name, place and
stead, in any and all capacities, to sign one or more Registration Statements on
Form S-3 relating to up to $750,000,000 of securities of Cinergy Corp. and CC
Funding Trust II, any and all amendments thereto (including post-effective
amendments), and any subsequent Registration Statements pursuant to Rule 462 of
the Securities Act of 1933 and amendments thereto, and to file the same, with
all exhibits and schedules thereto and other documents in connection therewith,
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 desirable to be done in
and about the premises, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned director has caused this Power of
Attorney to be executed as of this 2nd day of December, 2002.


                                             /s/ Thomas E. Petry
                                             -------------------
                                             Thomas E. Petry



                                POWER OF ATTORNEY

     KNOW ALL BY THESE PRESENTS, that the undersigned director of Cinergy Corp.
hereby constitutes and appoints R. Foster Duncan, Ronald R. Reising,
Wendy L. Aumiller, Marc E. Manly, Jerome A. Vennemann and Julia S. Janson, and
each of them, with full power to act without the other, the undersigned's true
and lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for the undersigned and in the undersigned's name, place and
stead, in any and all capacities, to sign one or more Registration Statements on
Form S-3 relating to up to $750,000,000 of securities of Cinergy Corp. and CC
Funding Trust II, any and all amendments thereto (including post-effective
amendments), and any subsequent Registration Statements pursuant to Rule 462 of
the Securities Act of 1933 and amendments thereto, and to file the same, with
all exhibits and schedules thereto and other documents in connection therewith,
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 desirable to be done in
and about the premises, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned director has caused this Power of
Attorney to be executed as of this 18th day of December, 2002.


                                             /s/ Mary L. Schapiro
                                             --------------------
                                             Mary L. Schapiro



                                POWER OF ATTORNEY

     KNOW ALL BY THESE PRESENTS, that the undersigned director of Cinergy Corp.
hereby constitutes and appoints R. Foster Duncan, Ronald R. Reising,
Wendy L. Aumiller, Marc E. Manly, Jerome A. Vennemann and Julia S. Janson, and
each of them, with full power to act without the other, the undersigned's true
and lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for the undersigned and in the undersigned's name, place and
stead, in any and all capacities, to sign one or more Registration Statements on
Form S-3 relating to up to $750,000,000 of securities of Cinergy Corp. and CC
Funding Trust II, any and all amendments thereto (including post-effective
amendments), and any subsequent Registration Statements pursuant to Rule 462 of
the Securities Act of 1933 and amendments thereto, and to file the same, with
all exhibits and schedules thereto and other documents in connection therewith,
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 desirable to be done in
and about the premises, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned director has caused this Power of
Attorney to be executed as of this 2nd day of December, 2002.


                                             /s/ John J. Schiff, Jr.
                                             -----------------------
                                             John J. Schiff, Jr.



                                POWER OF ATTORNEY

     KNOW ALL BY THESE PRESENTS, that the undersigned director of Cinergy Corp.
hereby constitutes and appoints R. Foster Duncan, Ronald R. Reising,
Wendy L. Aumiller, Marc E. Manly, Jerome A. Vennemann and Julia S. Janson, and
each of them, with full power to act without the other, the undersigned's true
and lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for the undersigned and in the undersigned's name, place and
stead, in any and all capacities, to sign one or more Registration Statements on
Form S-3 relating to up to $750,000,000 of securities of Cinergy Corp. and CC
Funding Trust II, any and all amendments thereto (including post-effective
amendments), and any subsequent Registration Statements pursuant to Rule 462 of
the Securities Act of 1933 and amendments thereto, and to file the same, with
all exhibits and schedules thereto and other documents in connection therewith,
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 desirable to be done in
and about the premises, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned director has caused this Power of
Attorney to be executed as of this 1st day of December, 2002.


                                             /s/ Philip R. Sharp
                                             -------------------
                                             Philip R. Sharp



                                POWER OF ATTORNEY

     KNOW ALL BY THESE PRESENTS, that the undersigned director of Cinergy Corp.
hereby constitutes and appoints R. Foster Duncan, Ronald R. Reising,
Wendy L. Aumiller, Marc E. Manly, Jerome A. Vennemann and Julia S. Janson, and
each of them, with full power to act without the other, the undersigned's true
and lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for the undersigned and in the undersigned's name, place and
stead, in any and all capacities, to sign one or more Registration Statements on
Form S-3 relating to up to $750,000,000 of securities of Cinergy Corp. and CC
Funding Trust II, any and all amendments thereto (including post-effective
amendments), and any subsequent Registration Statements pursuant to Rule 462 of
the Securities Act of 1933 and amendments thereto, and to file the same, with
all exhibits and schedules thereto and other documents in connection therewith,
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 desirable to be done in
and about the premises, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned director has caused this Power of
Attorney to be executed as of this 2nd day of December, 2002.


                                             /s/ Dudley S. Taft
                                             ------------------
                                             Dudley S. Taft

EX-24.2

                                                                    EXHIBIT 24.2

                            CERTIFICATE OF SECRETARY

     I, JULIA S. JANSON, Secretary of Cinergy Corp., a Delaware corporation, DO
HEREBY CERTIFY that the following is a true and correct copy of a resolution
duly adopted by the Board of Directors of said corporation on December 5, 2002,
and that such resolution has not been amended and is in full force and effect on
the date hereof:

     RESOLVED FURTHER That each officer and director of the Corporation who may
be required to sign and execute each Registration Statement covering the
Securities or amendments and supplements thereto or documents in connection
therewith (whether for or on behalf of the Corporation or the Trusts, or as an
officer of the Corporation, or otherwise) is hereby authorized to execute a
power of attorney appointing R. Foster Duncan, Ronald R. Reising,
Wendy L. Aumiller, Marc E. Manly, Jerome A. Vennemann and Julia S. Janson, and
each of them, severally, his or her true and lawful attorney or attorneys to
sign in his or her name, place and stead, in any such capacity, such
Registration Statements and any and all amendments and supplements thereto,
including amendments or supplements to the prospectus contained in such
Registration Statement or amendments thereto, and to file the same, with all
exhibits and schedules thereto and other documents in connection therewith, with
the Commission, each of such attorneys to have power to act with or without the
other, and to have full power and authority to do and perform, in the name and
on behalf of each of such officers and directors who shall have executed such a
power of attorney, every act whatsoever which such attorneys, or either of them,
may deem necessary or advisable to be done in connection therewith as fully and
to all intents and purposes as such officers or directors might or could do in
person.

     IN WITNESS WHEREOF, I have hereunto subscribed my name this 15th day of
January, 2003.


                                           /s/ Julia S. Janson
                                           -------------------
                                           Julia S. Janson
                                           Secretary

EX-25.1

                                                                    EXHIBIT 25.1

                                    FORM T-1                        File No.____

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                       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)

                                FIFTH THIRD BANK
                                ----------------
               (Exact name of trustee as specified in its charter)

                                      Ohio
                                      ----
     (Jurisdiction of incorporation or organization if not a national bank)

                                   31-0854433
                                   ----------
                      (I.R.S. Employer Identification No.)

                   38 Fountain Square Plaza, Cincinnati, Ohio
                   ------------------------------------------
                    (Address of principal executive offices)

                                      45263
                                      -----
                                   (Zip Code)

                    Paul L. Reynolds, 5th and Walnut Streets
                     Cincinnati, Ohio, 45263 (513) 579-5300
                     --------------------------------------
            (Name, address and telephone number of agent for service)

                                  CINERGY CORP.
                                  -------------
               (Exact name of obligor as specified in its charter)

                                    Delaware
                                    --------
         (State or other jurisdiction of incorporation or organization)

                                   31-1385023
                                   ----------
                      (I.R.S. Employer Identification No.)

                    139 East Fourth Street, Cincinnati, Ohio
                    ----------------------------------------
                    (Address of principal executive offices)

                                      45202
                                      -----
                                   (Zip Code)

                                 Debt Securities
                                 ---------------
                       (Title of the indenture securities)



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.

          Ohio Superintendent of Banks
          State Office Tower
          30 E. Broad Street
          Columbus, Ohio 43215

          Federal Reserve Bank of Cleveland
          East Sixth Street and Superior Avenue
          Cleveland, Ohio 44101

          Federal Deposit Insurance Corporation,
          Washington, D.C.

     (b)  Whether it is authorized to exercise corporate trust powers.

          Yes.

ITEM 2.   AFFILIATIONS WITH OBLIGOR.

          If the obligor is an affiliate of the trustee, describe each such
affiliation.

     None.

ITEMS 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 14 AND 15 ARE NOT APPLICABLE BY VIRTUE OF
THE ANSWER TO ITEM 13.

ITEM 13. DEFAULTS BY THE OBLIGOR.

     (a) State whether there is or has been a default with respect to the
securities under this indenture. Explain the nature of any such default.

None.

     (b) If the Trustee is a trustee under another indenture under which any
other securities, or certificates of interest or participation in any other
securities, of the obligor are outstanding, or is trustee for more than one
outstanding series of securities under the indenture, state whether there has
been a default under any such indenture or series, identify the indenture or
series affected, and explain the nature of any such default.

None.

                                        2


ITEM 16.   LIST OF EXHIBITS.

          List below all exhibits filed as a part of this statement of
eligibility.

     (1)  A copy of the Certificate of Incorporation of the trustee as now in
          effect.

     (2)  A copy of the certificate of authority of the trustee to commence
          business. (Included in Exhibit 1)

     (3)  A copy of the authorization of the trustee to exercise corporate trust
          powers.

     (4)  A copy of the existing code of regulations of the trustee
          incorporating amendments to date.

     (5)  A copy of each indenture referred to in Item 4.

     (6)  The consent of the trustee required by Section 321 (b) of the Trust
          Indenture Act of 1939.

     (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.

     (8)  A copy of any order pursuant to which the foreign trustee is
          authorized to act as sole trustee under indentures qualified or to be
          qualified under the Act.

     (9)  Foreign trustees are required to file a consent to service of process
          of Form F-X

                                        3


                                    SIGNATURE

          Pursuant to the requirements of the Trust Indenture Act of 1939, the
trustee, Fifth Third Bank, a corporation organized and existing under the laws
of the State of Ohio, 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 Cincinnati and the State of Ohio, on the 15th day
of January, 2003.

                                        FIFTH THIRD BANK

                                        By:  /s/ Christine M. Schaub
                                             -----------------------

                                        Its: Vice President
                                             --------------

                                        4


                                    EXHIBIT 1

                          CERTIFICATE OF INCORPORATION
                         OF THE TRUSTEE AS NOW IN EFFECT

                        AMENDED ARTICLES OF INCORPORATION

                                       OF

                         FIFTH THIRD BANK, WESTERN OHIO

FIRST:    The name of this Corporation shall be Fifth Third Bank.

SECOND:   The place in Ohio where its principal office is to be located is
          Cincinnati, Hamilton County, Ohio.

THIRD:    This Corporation is formed for the purpose of (a) receiving on deposit
          or in trust, moneys, securities and other valuable property, on such
          terms as may be agreed, and of doing the business of a savings bank
          and of a trust company; (b) disposing of box vaults for safekeeping of
          valuables by lease or otherwise; (c) investing and loaning the funds
          of the company and those received by it on deposit or in trust; (d)
          doing a commercial banking business; (e) doing the business of a
          special plan bank; and (f) doing any other lawful act or activity for
          which banking corporations may be formed under Ohio law; and in
          furtherance of said purposes, to exercise all of the powers which may
          be lawfully exercised by a corporation formed therefor, and to do all
          things necessary or incident thereto.

FOURTH:   The maximum number of shares which this Corporation is authorized to
          have outstanding shall be Four Hundred Fifty-Four Thousand Forty-Two
          (454,042) shares of common stock, with a par value of Ten Dollars
          ($10.00) per share.

FIFTH:    No holder of any share or shares of any class issued by this
          Corporation shall be entitled as such, as a matter of right, at any
          time, to subscribe for or purchase (i) shares of any class issued by
          this Corporation, now or hereafter authorized, (ii) securities of this
          Corporation convertible into or exchangeable for shares of any class
          issued by this Corporation, now or hereafter authorized, or (iii)
          securities of this Corporation to which shall be attached or appertain
          to any rights or options whether by the terms of such securities or in
          the contracts, warrants, or other instruments (whether transferable or
          non-transferable or separable or inseparable from such securities)
          evidencing such rights or options entitling the holders thereof to
          subscribe for or purchase shares of any class issued by this
          Corporation, now or hereafter authorized; it being the intent and is
          the effect of this Article Fifth to fully eliminate any and all
          pre-emptive rights with respect to the shares of any class issued by
          this Corporation now or hereafter authorized.

                                        5


SIXTH:    When authorized by the affirmative vote of a majority of the Board of
          Directors, without the action or approval of the shareholders of this
          Corporation, and when approved in advance by the Ohio Superintendent
          of Banks, this Corporation may redeem, purchase, or contract to
          purchase, at any time and from time to time, shares of any class
          issued by this Corporation for such prices and upon and subject to
          such terms and conditions that the Board of Directors may determine.

SEVENTH:  These Amended Articles of Incorporation supersede and take the place
          of the existing Articles of Incorporation.

                                        6


                                    EXHIBIT 2

                         CERTIFICATE OF AUTHORITY OF THE
                          TRUSTEE TO COMMENCE BUSINESS
                             (INCLUDED IN EXHIBIT 1)

                                        7


                                    EXHIBIT 3

                   A COPY OF THE AUTHORIZATION OF THE TRUSTEE
                       TO EXERCISE CORPORATE TRUST POWERS

                                 [See Attached]

                                        8


                                  STATE OF OHIO

                       DIVISION OF FINANCIAL INSTITUTIONS

This is to certify that Fifth Third Bank, Cincinnati, Ohio, organized under the
laws of the State of Ohio has complied with the laws relating to trust companies
under Section 1111.04 of the Ohio Revised Code and is qualified to exercise
trust powers in Ohio.

Witness my hand at Columbus, Ohio, this 30th day of December, 2002.

                                        /s/ F. Scott O'Donnell
                                        ----------------------
                                        F. Scott O'Donnell
                                        Superintendent
                                        Division of Financial Institutions

                                        9


                                    EXHIBIT 4

            A COPY OF THE EXISTING CODE OF REGULATIONS OF THE TRUSTEE
                        INCORPORATING AMENDMENTS TO DATE

                                 [See Attached]

                                       10


                     CODE OF REGULATIONS OF FIFTH THIRD BANK

                                    ARTICLE I
                                  SHAREHOLDERS

     SECTION 1. MEETINGS. The annual meeting of the Shareholders shall be held
at the principal office of the Corporation at such hour, as may be fixed in the
notice of such meeting, and on such date, not earlier than the second Tuesday of
January or later than the third Tuesday of April of each year, as shall be fixed
by the Board of Directors and communicated in writing to the Shareholders not
later than twenty (20) days prior to such meeting.

     SECTION 2. QUORUM. Shareholders, whether in person or by lawful proxies,
representing a majority in amount of the outstanding stock of the Corporation,
shall constitute a quorum at any Shareholders' meeting. If there be less than a
majority in amount of such stock at any meeting, the meeting may be adjourned
from time to time.

                                   ARTICLE II
                               BOARD OF DIRECTORS

     SECTION 1. ELECTION AND NUMBER. The Board of Directors shall be elected by
the Shareholders. The Board of Directors shall be composed of eighteen (18)
persons unless this number is changed by: (1) the Shareholders in accordance
with the applicable laws of Ohio or (2) the vote of a majority of the Directors
in office. The Directors may increase the number to not more than twenty four
(24) persons and may decrease the number to not less than fifteen (15) persons.
Any Director's office created by the Directors by reason of an increase in their
number may be filled by action of a majority of the Directors in office. Within
sixty (60) days of the election or appointment of each Director, the Director
shall take and subscribe to an oath to diligently and honestly perform the
duties of a director and to not knowingly violate, or permit to be violated, any
federal or Ohio banking law.

     SECTION 2. TERM. Directors shall hold office until the expiration of the
term for which they were elected, and shall continue in office until their
respective successors shall have been duly elected and qualified. Any such term
of office shall be no longer than three (3) years.

     SECTION 3. QUALIFICATIONS AND COMPENSATION. No person shall serve as a
Director who does not meet the qualification requirements of the applicable laws
of Ohio. Each Director shall be entitled to receive such compensation for
attendance at meetings of the Board of Directors or Committees thereof as the
Board of Directors may, from time to time, fix.

     SECTION 4. REPLACEMENT OR REMOVAL. Directors may be replaced or removed as
provided by the laws of Ohio, provided that Directors may be removed without
cause only by an affirmative vote of not less than two-thirds (2/3) of the
outstanding shares of the Corporation.

     SECTION 5. VACANCIES. Any vacancy occurring in the Board of Directors may
be filled by the Board of Directors until an election to fill such vacancy is
had.

                                       11


     SECTION 6. QUORUM. A majority of the whole authorized number of Directors,
as the same shall be established from time to time in accordance with Section 1
of this Code of Regulations, shall constitute a quorum for a meeting of the
Directors, except that a majority of the Directors in office constitutes a
quorum for the filling of a vacancy or vacancies of the Board.

     SECTION 7. MEETINGS OF THE BOARD. Regular meetings of the Board of
Directors shall be held on the third Tuesday of each month, or at such other
times as may be determined by the Board of Directors. Except as otherwise
provided by the laws of Ohio, any business may be transacted at any regular
meeting of the Board of Directors. Special meetings shall be held upon the call
of the Chairman of the Board, if one be elected, or by the President, or in
their absence, by a Vice President or any three (3) Directors.

     SECTION 8. NOTICE OF MEETINGS. The Secretary shall give notice of each
meeting of the Board of Directors, whether regular or special, to each member to
the Board.

     SECTION 9. COMMITTEES.

     9.1 EXECUTIVE COMMITTEE. The Board of Directors shall appoint an Executive
Committee consisting of at least three (3) members of the Board of Directors.
Such executive Committee shall serve until their successors are appointed. A
majority of the members of said Committee shall constitute a quorum. The
Executive Committee shall conduct the business of the Corporation and shall have
all the powers of the Board of Directors when said Board is not in session,
except that of declaring a dividend. The Secretary of the Corporation shall keep
a record of the Committee's proceedings, which, signed by the Chairman of the
Committee, shall be presented at the meetings of the Committees and at the
meetings of the Board of Directors.

     9.2 OTHER COMMITTEES. The Board of Directors shall appoint a Trust
Committee of which the Vice President and Trust Officer and at least three (3)
of its members who are not officers of the Corporation shall be members. The
Vice President and Trust Officer shall be Chairman of the Trust Committee. In
addition thereto, the Chairman of the Board, Chief Executive Officer or
President, may appoint such additional Committees, by and with the approval of
the Board of Directors, as may be deemed desirable or necessary.

     Each such Committee, so appointed, shall have such powers and perform such
duties, not inconsistent with the applicable laws of Ohio, as may be delegated
to it by the Board of Directors.

SECTION 10. INDEMNIFICATION. The Corporation shall indemnify each Director and
each Officer of the Corporation, and each person employed by the Corporation who
serves at the written request of the President of the Corporation as a director,
trustee, officer, employee, or agent of another corporation, domestic or
foreign, non-profit or for profit, partnership, joint venture, trust or other
enterprise, to the full extent permitted by the applicable laws of Ohio. The
term 'Officer' as used in this Section shall include the Chairman of the Board
and the Vice Chairman of the Board if such offices are filled, the Chief
Executive Officer, the President, each Vice President, each Affiliate Director,
the Treasurer, the Secretary, the Cashier, the Controller, the Auditor, the
Counsel and any other person who is specifically designated as an 'Officer'
within

                                       12


the operation of this Section by action of the Board of Directors. The
Corporation may indemnify assistant Officers, employees and others by action of
the Board of Directors to the extent permitted by the applicable laws of Ohio.

                                   ARTICLE III
                                    OFFICERS

     SECTION 1. ELECTION OF OFFICERS. The Board of Directors at the first
meeting after the election of Directors may elect one of its own number Chairman
of the Board and one of its own number Vice Chairman of the Board; and it shall
elect one of its own number President. It may also elect a Chief Executive
Officer, one or more Vice Presidents (one or more of whom may be designated
Executive Vice President and/or Senior Vice President and/or Vice President and
Trust Officer), one or more Affiliate Directors, a Cashier, a Secretary, and a
Treasurer, and it may appoint such other officers as the Board may deem
advisable. The Corporation may also elect a Chief Executive Officer, President,
Chief Financial Officer, Secretary and/or Treasurer for each affiliate of the
Corporation as determined appropriate from time to time by the Board of
Directors, with such officers having the name of such affiliate appended to his
of her title (e.g., President (Northeastern Ohio)). Any two or more offices may
be held by the same person. Officers so elected shall hold office during the
term of the Board by whom they are elected, subject to the power of the Board to
remove them at its discretion. They shall be bonded in such amount and with such
surety or securities as the Board of Directors shall require.

     SECTION 2. POWERS AND DUTIES. The Chairman of the Board of Directors, if
the office be filled, otherwise the Vice Chairman of the Board of Directors, if
the office be filled, otherwise the President shall preside at all meetings of
the Shareholders and the Board of Directors, shall be responsible for the
supervision and control over the business of the Corporation and shall serve at
the pleasure of the Board of Directors. In the absence or disability of any of
the foregoing officers, their respective duties shall be performed by the
Chairman of the Board, the Vice Chairman of the Board, the President, or by a
Vice President specifically designated by the Board of Directors, in the order
named.

     The Secretary, or in his absence or disability, the assistant Secretary,
shall act, ex officio, as Secretary of all meetings of the Shareholders, the
Board of Directors and the Executive Committee. The other officers of the
Corporation shall have such powers and duties as usually and customarily attach
to their offices.

                                   ARTICLE IV
                          AFFILIATE BOARDS OF DIRECTORS

     SECTION 1. AFFILIATE BOARDS OF DIRECTORS. The Board of Directors may elect
such of its members and Officers of the Corporation (whether or not such other
persons are employed by the Corporation) in such numbers as the Board of
Directors deems necessary to form an affiliate board of directors for such
affiliates of the Corporation as determined appropriate from time to time by the
Board of Directors. As of December 29, 2000, such affiliates are anticipated to
be known as: Fifth Third Bank (Central Ohio), Fifth Third Bank (Ohio Valley),
Fifth Third Bank (Northwestern Ohio), Fifth Third Bank (Northeastern Ohio), and
Fifth Third Bank (Western Ohio). Any person designated as an Affiliate Director,
who is not employed by the Corporation,

                                       13


shall be a Non-Employee Officer of the Corporation. Affiliate Directors so
elected shall hold office during the term of the Board by whom they are
appointed, subject to the power of the Board to remove them at its discretion
and/or until such time as their successors have been duly elected and qualified.

     SECTION 2. POWERS AND DUTIES. The Board of Directors may delegate to each
Affiliate Board of Directors the power and authority to take by majority vote of
the members of such Affiliate Board of Directors any and all such actions that
may be legally delegated by the Board of Directors to any one or more officers
of the Corporation pursuant to the laws of Ohio. Any action taken by any
Affiliate Director pursuant to the direction given or authorization granted to
him or her by such Affiliate Board of Directors shall constitute the valid and
legal act of the Corporation pursuant to the approval and authorization of the
Board of Directors.

     SECTION 3. EXECUTIVE COMMITTEES. Each Affiliate Board of Directors shall
appoint an Executive Committee consisting of at least three (3) members of the
respective Affiliate Board of Directors. Such executive Committee shall serve
until their successors are appointed. The Board of Directors may delegate to
each such Executive Committee of an Affiliate Board of Directors any and all
such actions that may be legally delegated to the respective Affiliate Board of
Directors pursuant to the laws of Ohio. Any action taken by any officer of the
Corporation pursuant to the direction given or authorization granted to him or
her by such an Executive Committee shall constitute the valid and legal act of
the Corporation pursuant to the approval and authorization of the Board of
Directors.

                                    ARTICLE V
                              CERTIFICATES OF STOCK

     SECTION 1. FORM. Certificates for shares of stock shall be signed by the
Chairman of the Board, or by the President, or by one of the Vice Presidents,
and by the Secretary or Treasurer or by the Cashier or an Assistant Cashier,
shall contain such statements as are required by applicable Ohio law, and shall
otherwise be in such form as the Board of Directors may, from time to time,
require.

     SECTION 2. TRANSFERS. Shares shall be transferable on the books of the
Corporation by the holders thereof in person or by duly authorized attorney upon
surrender of the certificates therefor with duly executed assignment endorsed
thereon or attached thereto.

     SECTION 3. CLOSING OF TRANSFER BOOKS. The books for the transfer of the
stock of the Corporation shall be closed for at least five (5) days preceding
the annual meeting of Shareholders, and may be closed by order of the Board of
Directors, or Executive Committee, for a like period before any other meeting of
the Shareholders.

                                   ARTICLE VI
                                   AMENDMENTS

     These regulations may be changed, and new regulations adopted by the assent
thereto in writing of at least two-thirds (2/3) of the Shareholders of the
Corporation in number and in amount or by a majority of such Shareholders in
number and in amount; at a meeting held for

                                       14


that purpose, notice of which has been given by the President, the Secretary, or
any two (2) Directors on behalf of the Corporation, personally or by written
notice, to each Shareholder, or in such other manner as may then be authorized
by the applicable laws of Ohio.

                                       15


                                    EXHIBIT 5

                 A COPY OF EACH INDENTURE REFERRED TO IN ITEM 4

                                (NOT APPLICABLE)

                                       16


                                    EXHIBIT 6

             THE CONSENT OF THE TRUSTEE REQUIRED BY SECTION 321 (B)
                       OF THE TRUST INDENTURE ACT OF 1939

                                 [See Attached]

                                       17


                              EXHIBIT 6 TO FORM T-1

                               CONSENT OF TRUSTEE

     Pursuant to the requirements of Section 321(b) of the Trust Indenture Act
of 1939 in connection with the proposed issuance of Debt Securities of Cinergy
Corp., Fifth Third Bank hereby consents that reports of examination by Federal,
State, Territorial or District Authorities may be furnished by such authorities
to the Securities and Exchange Commission upon request therefor.

                                        FIFTH THIRD BANK

                                        By:  /s/ Christine M. Schaub
                                             -----------------------

                                        Its: Vice President
                                             --------------



                                    EXHIBIT 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

                                 [See Attached]



CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR SEPTEMBER 30, 2002

All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding as of the last business day of the
quarter.

SCHEDULE RC - BALANCE SHEET



                                                                                                 Dollar Amounts in Thousands
- ----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                 
ASSETS

1.   Cash and balance due from depository institutions (from Schedule RC-A):                           RCFD
                                                                                                                ----------
     a.   Noninterest-bearing balances and currency and coin (1) ............................          0081        932,991   1.a
                                                                                                                ----------
     b.   Interest-bearing balances (2) .....................................................          0071         32,509   1.b
                                                                                                                ----------
2.   Securities:
                                                                                                                ----------
     a.   Held-to-maturity securities (from Schedule RC-B, column A) ........................          1754         12,908   2.a
                                                                                                                ----------
     b.   Available-for-sale securities (from Schedule RC-B, column D) ......................          1773     13,880,429   2.b
                                                                                                                ----------
3.   Federal Funds sold and securities purchased under agreements to resell                            RCON
                                                                                                                ----------
     a.   FEDERAL FUNDS SOLD IN DOMESTIC OFFICES                                                       B987        933,368   3.a
                                                                                                                ----------
                                                                                                       RCFD
                                                                                                                ----------
     b.   SECURITIES PURCHASED UNDER AGREEMENTS TO RESELL (3) ...............................          B989              0   3.b
                                                                                                                ----------
4.   Loans and lease financing receivables (from Schedule RC-C):
                                                                                                                ----------
     a.   Loans and leases held for sale .....................................                         5369      2,558,712   4.a
                                                                                                 ----------     ----------
     b.   Loans and leases, net of unearned income ...........................   B528            22,815,854                  4.b
                                                                                                 ----------
     c.   LESS: Allowance for loan and lease losses ..........................   3123               335,331                  4.c
                                                                                                 ----------
     d.   Loans and leases, net of unearned income and
          allowance (Item 4.b minus 4.c) ....................................................          B529     22,480,523   4.d

5.   Trading assets (from Schedule RC-D) ....................................................          3545          5,147   5.
                                                                                                                ----------
6.   Premises and fixed assets (including capitalized leases) ...............................          2145        394,056   6.
                                                                                                                ----------
7.   Other real estate owned (from Schedule RC-M) ...........................................          2150         15,015   7.
                                                                                                                ----------
8.   Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M)          2130              0   8.
                                                                                                                ----------
9.   Customers' liability to this bank on acceptances outstanding ...........................          2155         21,896   9.
                                                                                                                ----------
10.  Intangible assets                                                                                                       10.
     a.   Goodwill ..........................................................................          3163        156,985   10.a
                                                                                                                ----------
     b.   Other intangible assets (from Schedule RC-M) ......................................          0426        427,493   10.b
                                                                                                                ----------
11.  Other assets (from Schedule RC-F) ......................................................          2160      1,903,953   11.
                                                                                                                ----------
12.  Total Assets (sum of items 1 through 11) ...............................................          2170     43,755,985   12.
                                                                                                                ----------


- ----------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposits not held for trading.
(3) INCLUDES ALL SECURITIES RESALE AGREEMENTS IN DOMESTIC AND FOREIGN OFFICES,
REGARDLESS OF MATURITY.



SCHEDULE RC - CONTINUED



                                                                                                 Dollar Amounts in Thousands
- ------------------------------------------------------------------------------------------------------------------------------------
                                                                                                              
LIABILITIES
13.  Deposits:
     a.   In domestic offices (sum of totals of columns A and C from Schedule RC-E,                    RCON
                                                                                                                ----------
     part 1)                                                                       RCON                2200     21,355,597   13.a.
                                                                                                                ----------
                                                                                          ----------
          1.   Noninterest-bearing (1) ....................................        6631    1,339,504                         13.a.1.
                                                                                          ----------
          2.   Interest-bearing ...........................................        6636   20,016,093                         13.a.2.
                                                                                          ----------
     b.   In foreign offices, Edge and Agreement subsidiaries, and IBFs                                RCFN
                                                                                                                ----------
          (from Schedule RC-E, part II) ...................................                            2200      2,419,892   13.b.
                                                                                                                ----------
                                                                                   RCFN
                                                                                          ----------
          1.   Noninterest-bearing ........................................        6631            0                         13.b1
                                                                                          ----------
          2.   Interest-bearing ...........................................        6636    2,419,892                         13.b2
                                                                                          ----------            ----------
14.  Federal Funds purchased and securities sold under agreements to repurchase .................      RCON
                                                                                                                ----------
     a.   FEDERAL FUNDS SOLD IN DOMESTIC OFFICES                                                       B993      6,758,013   14.a
                                                                                                                ----------
                                                                                                       RCFD
                                                                                                                ----------
     b.   SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE (3)                                           B995      2,974,276   14.b
                                                                                                                ----------
15.  Trading liabilities (from Schedule RC-D) ...................................................      3548              0   15
                                                                                                                ----------
16.  Other borrowed money (includes mortgage indebtedness and obligations under capitalized
     leases) (from Schedule RC-M): ..............................................................      3190      3,146,643   16
                                                                                                                ----------
17.  Not applicable
                                                                                                                ----------
18.  Bank's liability on acceptances executed and outstanding ...................................      2920         21,896   18
                                                                                                                ----------
19.  Subordinated notes and debentures (4) ......................................................      3200        609,663   19
                                                                                                                ----------
20.  Other liabilities (from Schedule RC-G) .....................................................      2930      2,382,665   20
                                                                                                                ----------
21.  Total liabilities (sum of items 13 through 20) .............................................      2948     39,668,645   21
                                                                                                                ----------
22.  Minority interest in consolidated subsidiaries                                                    3000        452,205   22
                                                                                                                ----------
EQUITY CAPITAL
                                                                                                                ----------
23.  Perpetual preferred stock and related surplus ..............................................      3838              0   23
                                                                                                                ----------
24.  Common Stock ...............................................................................      3230          4,540   24
                                                                                                                ----------
25.  Surplus (exclude all surplus related to preferred stock)                                          3839      1,240,811   25
                                                                                                                ----------
26.  a.   Retained earnings                                                                            3632      2,234,357   26.a.
                                                                                                                ----------
     b.   Accumulated other comprehensive income (5)                                                   B530        155,427   26.b.
                                                                                                                ----------
27.  OTHER EQUITY CAPITAL COMPONENTS (6) ........................................................      A130              0   27
                                                                                                                ----------
28.  Total equity capital (sum of items 23 through 27) ..........................................      3210      3,635,135   28
                                                                                                                ----------
29.  Total liabilities, minority interest and equity capital (sum of items 21, 22 and 28) .......      3300     43,755,985   29
                                                                                                                ----------



- ----------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
(2) REPORT OVERNIGHT FEDERAL HOME LOAN BANK ADVANCES IN SCHEDULE RC, ITEM 16,
"OTHER BORROWED MONEY."
(3) INCLUDES ALL SECURITIES REPURCHASE AGREEMENTS IN DOMESTIC AND FOREIGN
OFFICES, REGARDLESS OF MATURITY.
(4) Includes limited-life preferred stock and related surplus.
(5) Includes net unrealized holding gains (losses) on available-for-sale
securities, accumulated net gains (losses) on cash flow hedges, cumulative
foreign currency translation adjustments, and minimum pension liability
adjustments.
(6) Includes treasury stock and unearned Employee Stock Ownership Plan shares.



MEMORANDUM

TO BE REPORTED ONLY WITH THE MARCH REPORT OF CONDITION



                                                                   RCFD   NUMBER
                                                                   ----   ------
                                                                            
1. Indicate in the box at the right the number of the statement
   below that best describes the most comprehensive level of
   auditing work performed for the bank by independent external
   auditors as of any date during 2001 .........................   6724      N/A     M.1



1= Independent audit of the bank conducted in accordance with generally accepted
   auditing standards by a certified public accounting firm which submits a
   report on the bank.
2= Independent audit of the bank's parent holding company conducted in
   accordance with generally accepted auditing standards by a certified public
   accounting firm which submits a report on the consolidated holding company
   (but not on the bank separately)
3= Attestation on bank management's assertion on the effectiveness of the bank's
   internal control over financial reporting by a certified public accounting
   firm
4= Directors' examination of the bank conducted in accordance with generally
   accepted auditing standards by certified public accounting firm (may be
   required by state chartering authority)
5= Director's examination of the bank performed by other external auditors (may
   be required by state chartering authority)
6= Review of the bank's financial statements by external auditors
7= Compilation of bank's financial statements by external auditors
8= Other audit procedures (excluding tax preparation work)
9= No external audit work



                                    EXHIBIT 8


A COPY OF ANY ORDER PURSUANT TO WHICH THE FOREIGN TRUSTEE IS AUTHORIZED TO ACT
AS SOLE TRUSTEE UNDER INDENTURES QUALIFIED OR TO BE QUALIFIED UNDER THE ACT

                                (NOT APPLICABLE)



                                    EXHIBIT 9


          FOREIGN TRUSTEES ARE REQUIRED TO FILE A CONSENT TO SERVICE OF
                               PROCESS OF FORM F-X


                                (NOT APPLICABLE)

EX-25.2

                                                                    EXHIBIT 25.2
================================================================================

                                    FORM T-1

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                            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)    / /

                                   ----------

                              THE BANK OF NEW YORK
               (Exact name of trustee as specified in its charter)

New York                                               13-5160382
(State of incorporation                                (I.R.S. employer
if not a U.S. national bank)                           identification no.)

One Wall Street, New York, N.Y.                        10286
(Address of principal executive offices)               (Zip code)

                                   ----------

                               CC FUNDING TRUST II
               (Exact name of obligor as specified in its charter)

Delaware                                               38-6808544
(State or other jurisdiction of                        (I.R.S. employer
incorporation or organization)                         identification no.)

139 East Fourth Street
Cincinnati, Ohio                                       45202
(Address of principal executive offices)               (Zip code)

                                   ----------

                           Preferred Trust Securities
                       (Title of the indenture securities)

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



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.



                   Name                                    Address
- --------------------------------------------------------------------------------
                                              
     Superintendent of Banks of the State of     2 Rector Street, New York, N.Y.
     New York                                    10006, and Albany, N.Y. 12203

     Federal Reserve Bank of New York            33 Liberty Plaza, New York, N.Y.
                                                 10045

     Federal Deposit Insurance Corporation       Washington, D.C.  20429

     New York Clearing House Association         New York, New York   10005


     (b)  WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.

     Yes.

2.   AFFILIATIONS WITH OBLIGOR.

     IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
     AFFILIATION.

     None.

16.  LIST OF EXHIBITS.

     EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
     INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE
     7a-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R.
     229.10(d).

     1.   A copy of the Organization Certificate of The Bank of New York
          (formerly Irving Trust Company) as now in effect, which contains the
          authority to commence business and a grant of powers to exercise
          corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
          filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
          Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
          to Form T-1 filed with Registration Statement No. 33-29637.)

     4.   A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
          filed with Registration Statement No. 33-31019.)

     6.   The consent of the Trustee required by Section 321(b) of the Act.
          (Exhibit 6 to Form T-1 filed with Registration Statement No.
          33-44051.)

                                       -2-


     7.   A copy of the latest report of condition of the Trustee published
          pursuant to law or to the requirements of its supervising or examining
          authority.

                                       -3-


                                    SIGNATURE

     Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 13th day of January, 2003.

                                        THE BANK OF NEW YORK

                                        By: /s/    MARY LAGUMINA
                                            --------------------
                                        Name:  MARY LAGUMINA
                                        Title: VICE PRESIDENT

                                       -4-


                                                                       EXHIBIT 7

                       Consolidated Report of Condition of

                              THE BANK OF NEW YORK

                    of One Wall Street, New York, N.Y. 10286
                     And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business September 30,
2002, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.



                                                                  Dollar Amounts
                                                                    In Thousands
                                                                
ASSETS
Cash and balances due from depository
   institutions:
   Noninterest-bearing balances and currency
     and coin ................................................     $   3,735,469
   Interest-bearing balances .................................         3,791,026
Securities:
   Held-to-maturity securities ...............................         1,140,688
   Available-for-sale securities .............................        15,232,384
Federal funds sold in domestic offices .......................         1,286,657
Securities purchased under agreements to
   resell ....................................................         1,035,718
Loans and lease financing receivables:
   Loans and leases held for sale ............................           869,285
   Loans and leases, net of unearned
     income ..................................................        34,695,130
   LESS: Allowance for loan and
     lease losses ............................................           645,382
   Loans and leases, net of unearned
     income and allowance ....................................        34,049,748
Trading Assets ...............................................         9,044,881
Premises and fixed assets (including
   capitalized leases) .......................................           823,722
Other real estate owned ......................................               778
Investments in unconsolidated subsidiaries
   and associated companies ..................................           226,274
Customers' liability to this bank on
   acceptances outstanding ...................................           249,803
Intangible assets
   Goodwill ..................................................         1,852,232
   Other intangible assets ...................................            54,714
Other assets .................................................         4,961,572
                                                                   -------------
Total assets .................................................     $  78,354,951
                                                                   =============




                                                                
LIABILITIES
Deposits:
   In domestic offices .......................................     $  32,962,289
   Noninterest-bearing .......................................        12,792,415
   Interest-bearing ..........................................        20,169,874
   In foreign offices, Edge and Agreement
     subsidiaries, and IBFs ..................................        24,148,516
   Noninterest-bearing .......................................           445,725
   Interest-bearing ..........................................        23,702,791
Federal funds purchased in domestic
   Offices ...................................................          959,287
Securities sold under agreements to
   repurchase ................................................           491,806
Trading liabilities ..........................................         2,916,377
Other borrowed money:
   (includes mortgage indebtedness and obligations
   under capitalized leases) .................................         1,691,634
Bank's liability on acceptances executed and
   outstanding ...............................................           251,701
Subordinated notes and debentures ............................         2,090,000
Other liabilities ............................................         5,815,688
                                                                   -------------
Total liabilities ............................................     $  71,327,298
                                                                   =============

Minority interest in consolidated
   subsidiaries ..............................................           500,019

EQUITY CAPITAL
Perpetual preferred stock and related
   surplus ...................................................                 0
Common stock .................................................         1,135,284
Surplus ......................................................         1,056,724
Retained earnings ............................................         4,218,003
Accumulated other comprehensive income .......................          (117,623)
Other equity capital components ..............................                 0
Total equity capital .........................................         6,527,634
                                                                   -------------
Total liabilities minority interest and equity
   capital ...................................................     $  78,354,951
                                                                   =============





     I, Thomas J. Mastro, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition is true and
correct to the best of my knowledge and belief.


                                                       Thomas J. Mastro,
                                   Senior Vice President and Comptroller

     We, the undersigned directors, attest to the correctness of this statement
of resources and liabilities. We declare that it has been examined by us, and to
the best of our knowledge and belief has been prepared in conformance with the
instructions and is true and correct.

Thomas A. Renyi        )
Gerald L. Hassell      )                  Directors
Alan R. Griffith       )

EX-25.3

                                                                    EXHIBIT 25.3

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

                                    FORM T-1

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                            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)    / /

                                   ----------

                              THE BANK OF NEW YORK

               (Exact name of trustee as specified in its charter)

New York                                               13-5160382
(State of incorporation                                (I.R.S. employer
if not a U.S. national bank)                           identification no.)

One Wall Street, New York, N.Y.                        10286
(Address of principal executive offices)               (Zip code)

                                   ----------

                                  CINERGY CORP.
               (Exact name of obligor as specified in its charter)

Delaware                                               31-1385023
(State or other jurisdiction of                        (I.R.S. employer
incorporation or organization)                         identification no.)

139 East Fourth Street
Cincinnati, Ohio                                       45202
(Address of principal executive offices)               (Zip code)

                                   ----------

                        Guarantee of CC Funding Trust II
                           Preferred Trust Securities
                       (Title of the indenture securities)

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



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.



                    Name                                  Address
- --------------------------------------------------------------------------------
                                             
     Superintendent of Banks of the State of    2 Rector Street, New York, N.Y.
     New York                                   10006, and Albany, N.Y. 12203

     Federal Reserve Bank of New York           33 Liberty Plaza, New York, N.Y.
                                                10045

     Federal Deposit Insurance Corporation      Washington, D.C.  20429

     New York Clearing House Association        New York, New York   10005


     (b)  WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.

     Yes.

2.   AFFILIATIONS WITH OBLIGOR.

     IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
     AFFILIATION.

     None.

16.  LIST OF EXHIBITS.

     EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
     INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE
     7a-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R.
     229.10(d).

     1.   A copy of the Organization Certificate of The Bank of New York
          (formerly Irving Trust Company) as now in effect, which contains the
          authority to commence business and a grant of powers to exercise
          corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
          filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
          Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
          to Form T-1 filed with Registration Statement No. 33-29637.)

     4.   A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
          filed with Registration Statement No. 33-31019.)

     6.   The consent of the Trustee required by Section 321(b) of the Act.
          (Exhibit 6 to Form T-1 filed with Registration Statement No.
          33-44051.)

                                       -2-


     7.   A copy of the latest report of condition of the Trustee published
          pursuant to law or to the requirements of its supervising or examining
          authority.

                                       -3-


                                    SIGNATURE

     Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 13th day of January, 2003.

                                        THE BANK OF NEW YORK

                                        By: /s/     MARY LAGUMINA
                                            ---------------------
                                        Name:  MARY LAGUMINA
                                        Title: VICE PRESIDENT

                                       -4-


                                                                       EXHIBIT 7

                       Consolidated Report of Condition of

                              THE BANK OF NEW YORK

                    of One Wall Street, New York, N.Y. 10286
                     And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business September 30,
2002, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.



                                                                  Dollar Amounts
                                                                    In Thousands
                                                                 
ASSETS
Cash and balances due from depository
   institutions:
   Noninterest-bearing balances and currency
     and coin ................................................      $  3,735,469
   Interest-bearing balances .................................         3,791,026
Securities:
   Held-to-maturity securities ...............................         1,140,688
   Available-for-sale securities .............................        15,232,384
Federal funds sold in domestic offices .......................         1,286,657
Securities purchased under agreements to
   resell ....................................................         1,035,718
Loans and lease financing receivables:
   Loans and leases held for sale ............................           869,285
   Loans and leases, net of unearned
     income ..................................................        34,695,130
   LESS: Allowance for loan and
     lease losses ............................................           645,382
   Loans and leases, net of unearned
     income and allowance ....................................        34,049,748
Trading Assets ...............................................         9,044,881
Premises and fixed assets (including
   capitalized leases) .......................................           823,722
Other real estate owned ......................................               778
Investments in unconsolidated subsidiaries
   and associated companies ..................................           226,274
Customers' liability to this bank on
   acceptances outstanding ...................................           249,803
Intangible assets
   Goodwill ..................................................         1,852,232
   Other intangible assets ...................................            54,714
Other assets .................................................         4,961,572
                                                                    ------------
Total assets .................................................      $ 78,354,951
                                                                    ============




                                                                 
LIABILITIES
Deposits:
   In domestic offices .......................................      $ 32,962,289
   Noninterest-bearing .......................................        12,792,415
   Interest-bearing ..........................................        20,169,874
   In foreign offices, Edge and Agreement
     subsidiaries, and IBFs ..................................        24,148,516
   Noninterest-bearing .......................................           445,725
   Interest-bearing ..........................................        23,702,791
Federal funds purchased in domestic
   Offices ...................................................           959,287
Securities sold under agreements to repurchase ...............           491,806
Trading liabilities ..........................................         2,916,377
Other borrowed money:
   (includes mortgage indebtedness and obligations
   under capitalized leases) .................................         1,691,634
Bank's liability on acceptances executed and
   outstanding ...............................................           251,701
Subordinated notes and debentures ............................         2,090,000
Other liabilities ............................................         5,815,688
                                                                    ------------
Total liabilities ............................................      $ 71,327,298
                                                                    ============
Minority interest in consolidated
   subsidiaries ..............................................           500,019

EQUITY CAPITAL
Perpetual preferred stock and related
   surplus ...................................................                 0
Common stock .................................................         1,135,284
Surplus ......................................................         1,056,724
Retained earnings ............................................         4,218,003
Accumulated other comprehensive income .......................          (117,623)
Other equity capital components ..............................                 0
Total equity capital .........................................         6,527,634
                                                                    ------------
Total liabilities minority interest and equity
   capital ...................................................      $ 78,354,951
                                                                    ============





     I, Thomas J. Mastro, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition is true and
correct to the best of my knowledge and belief.


                                                       Thomas J. Mastro,
                                   Senior Vice President and Comptroller

     We, the undersigned directors, attest to the correctness of this statement
of resources and liabilities. We declare that it has been examined by us, and to
the best of our knowledge and belief has been prepared in conformance with the
instructions and is true and correct.

Thomas A. Renyi        )
Gerald L. Hassell      )                          Directors
Alan R. Griffith       )